Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 
FORM 10-Q
 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the Quarter Ended: Commission File Number:
April 30, 201629, 2017 001-16435

 
Chico’s FAS, Inc.
(Exact name of registrant as specified in charter)
 
 

Florida 59-2389435
(State of Incorporation) 
(I.R.S. Employer
Identification No.)
11215 Metro Parkway, Fort Myers, Florida 33966
(Address of principal executive offices)
239-277-6200
(Registrant’s telephone number, including area code)
 
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ý    No  ¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ý    No  ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer, accelerated" "accelerated filer," "smaller reporting company,” and smaller reporting company”"emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer ý  Accelerated filer ¨
Non-accelerated filer 
¨ (do not check if a smaller reporting company)
  Smaller reporting company ¨
Emerging growth company¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  ý
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
At May 16, 2016,15, 2017, the registrant had 132,609,279129,488,444 shares of Common Stock, $0.01 par value per share, outstanding.

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Table of Contents

CHICO’S FAS, INC. AND SUBSIDIARIES
TABLE OF CONTENTS
 
 
   
 
   
 
   
 
   
 
   
 
   
 
   
   
   
  
 
   
   
   
   
  

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Table of Contents

PART I – FINANCIAL INFORMATION
 
ITEM 1.FINANCIAL STATEMENTS

CHICO’S FAS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share amounts)
 
Thirteen Weeks EndedThirteen Weeks Ended
April 30, 2016 May 2, 2015April 29, 2017 April 30, 2016
    (as adjusted)     
Amount 
% of
Sales
 Amount 
% of
Sales
Amount 
% of
Sales
 Amount 
% of
Sales
Net sales$642,977
 100.0
 $697,766
 100.0
$583,728
 100.0
 $642,977
 100.0
Cost of goods sold380,642
 59.2
 402,148
 57.6
346,315
 59.3
 380,642
 59.2
Gross margin262,335
 40.8
 295,618
 42.4
237,413
 40.7
 262,335
 40.8
Selling, general and administrative expenses208,141
 32.4
 228,065
 32.7
182,539
 31.3
 208,141
 32.4
Restructuring and strategic charges3,651
 0.5
 14,875
 2.1

 0.0
 3,651
 0.5
Income from operations50,543
 7.9
 52,678
 7.6
54,874
 9.4
 50,543
 7.9
Interest expense, net(459) (0.1) (453) (0.1)(455) (0.1) (459) (0.1)
Income before income taxes50,084
 7.8
 52,225
 7.5
54,419
 9.3
 50,084
 7.8
Income tax provision19,000
 3.0
 19,700
 2.8
20,800
 3.5
 19,000
 3.0
Net income$31,084
 4.8
 $32,525
 4.7
$33,619
 5.8
 $31,084
 4.8
Per share data:              
Net income per common share-basic$0.23
   $0.22
  $0.26
   $0.23
  
Net income per common and common equivalent share–diluted$0.23
   $0.22
  $0.26
   $0.23
  
Weighted average common shares outstanding–basic131,594
   143,378
  126,050
   131,594
  
Weighted average common and common equivalent shares outstanding–diluted131,689
   143,771
  126,103
   131,689
  
Dividends declared per share$0.160
   $0.155
  $0.1650
   $0.1600
  

The accompanying notes are an integral part of these condensed consolidated statements.

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CHICO’S FAS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
(In thousands)
 
 Thirteen Weeks Ended
 April 30, 2016 May 2, 2015
Net income$31,084
 $32,525
Other comprehensive income (loss):   
Unrealized gains (losses) on marketable securities, net of taxes33
 (12)
Foreign currency translation losses, net of taxes(31) (210)
Comprehensive income$31,086
 $32,303
 Thirteen Weeks Ended
 April 29, 2017 April 30, 2016
Net income$33,619
 $31,084
Other comprehensive income:   
Unrealized gains on marketable securities, net of taxes21
 33
Foreign currency translation losses(24) (31)
Comprehensive income$33,616
 $31,086

The accompanying notes are an integral part of these condensed consolidated statements.

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CHICO’S FAS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
 
April 30, 2016 January 30, 2016 May 2, 2015April 29, 2017 January 28, 2017 April 30, 2016
          
ASSETS          
Current Assets:          
Cash and cash equivalents$56,502
 $89,951
 $97,651
$119,142
 $142,135
 $56,502
Marketable securities, at fair value50,479
 50,194
 48,447
50,629
 50,370
 50,479
Inventories267,988
 233,834
 270,313
273,878
 232,363
 267,988
Prepaid expenses and other current assets48,105
 45,660
 48,812
45,183
 50,350
 48,105
Income tax receivable10,928
 29,157
 447
1,717
 2,408
 10,928
Assets held for sale16,525
 16,525
 24,042

 
 16,525
Total Current Assets450,527
 465,321
 489,712
490,549
 477,626
 450,527
Property and Equipment, net535,470
 550,953
 584,616
460,845
 477,185
 535,470
Other Assets:          
Goodwill96,774
 96,774
 145,627
96,774
 96,774
 96,774
Other intangible assets, net38,930
 38,930
 108,449
38,930
 38,930
 38,930
Other assets, net14,415
 14,074
 17,953
18,432
 18,479
 14,415
Total Other Assets150,119
 149,778
 272,029
154,136
 154,183
 150,119

$1,136,116
 $1,166,052
 $1,346,357
$1,105,530
 $1,108,994
 $1,136,116
LIABILITIES AND STOCKHOLDERS’ EQUITY     
LIABILITIES AND SHAREHOLDERS’ EQUITY     
Current Liabilities:          
Accounts payable$144,767
 $129,343
 $147,323
$133,278
 $116,378
 $144,767
Current debt10,000
 10,000
 34,000
15,000
 16,250
 10,000
Other current and deferred liabilities142,091
 158,788
 171,161
149,151
 170,232
 142,091
Total Current Liabilities296,858
 298,131
 352,484
297,429
 302,860
 296,858
Noncurrent Liabilities:          
Long-term debt79,735
 82,219
 90,000
64,801
 68,535
 79,735
Deferred liabilities129,306
 130,743
 142,185
115,543
 118,543
 129,306
Deferred taxes16,740
 15,171
 49,273
14,613
 9,883
 16,740
Total Noncurrent Liabilities225,781
 228,133
 281,458
194,957
 196,961
 225,781
     
Commitments and Contingencies
 
 

 
 
Stockholders’ Equity:     
Shareholders’ Equity:     
Preferred stock
 
 

 
 
Common stock1,336
 1,355
 1,434
1,295
 1,288
 1,336
Additional paid-in capital436,581
 435,881
 353,523
453,999
 452,756
 436,581
Treasury stock, at cost(326,418) (289,813) (187,393)(395,585) (386,094) (326,418)
Retained earnings501,936
 492,325
 544,511
553,466
 541,251
 501,936
Accumulated other comprehensive income42
 40
 340
Total Stockholders’ Equity613,477
 639,788
 712,415
Accumulated other comprehensive (loss) income(31) (28) 42
Total Shareholders’ Equity613,144
 609,173
 613,477
$1,136,116
 $1,166,052
 $1,346,357
$1,105,530
 $1,108,994
 $1,136,116

The accompanying notes are an integral part of these condensed consolidated statements.

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CHICO’S FAS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
 
Thirteen Weeks EndedThirteen Weeks Ended
April 30, 2016 May 2, 2015April 29, 2017 April 30, 2016
Cash Flows From Operating Activities:      
Net income$31,084
 $32,525
$33,619
 $31,084
Adjustments to reconcile net income to net cash provided by operating activities —   
Adjustments to reconcile net income to net cash provided by operating activities:   
Depreciation and amortization27,957
 30,743
25,145
 27,957
Loss on disposal and impairment of property and equipment597
 6,277
513
 597
Deferred tax expense (benefit)307
 (425)
Deferred income taxes4,905
 307
Stock-based compensation expense5,546
 7,631
5,794
 5,546
Excess tax benefit from stock-based compensation(96) (2,012)
Deferred rent and lease credits(5,007) (4,283)(4,358) (5,007)
Changes in assets and liabilities:      
Inventories(34,154) (35,154)(41,516) (34,154)
Prepaid expenses and other assets14,617
 (3,468)
Prepaid expenses and other current assets5,264
 (3,613)
Income tax receivable691
 18,230
Accounts payable4,814
 (8,979)6,358
 4,814
Accrued and other liabilities(13,029) 18,884
(19,724) (13,029)
Net cash provided by operating activities32,636
 41,739
16,691
 32,732
Cash Flows From Investing Activities:      
Purchases of marketable securities(11,403) (18,252)(8,491) (11,403)
Proceeds from sale of marketable securities11,156
 96,351
8,259
 11,156
Purchases of property and equipment, net(13,056) (19,839)(9,531) (13,056)
Net cash (used in) provided by investing activities(13,303) 58,260
Net cash used in investing activities(9,763) (13,303)
Cash Flows From Financing Activities:      
Proceeds from borrowings
 124,000
Payments on borrowings(2,500) 
(5,000) (2,500)
Proceeds from issuance of common stock1,177
 8,025
1,062
 1,177
Excess tax benefit from stock-based compensation96
 2,012
Dividends paid(10,864) (11,076)(10,862) (10,864)
Repurchase of common stock(40,660) (258,450)(9,498) (36,637)
Payments of tax withholdings related to stock-based awards(5,599) (4,023)
Net cash used in financing activities(52,751) (135,489)(29,897) (52,847)
Effects of exchange rate changes on cash and cash equivalents(31) (210)(24) (31)
Net decrease in cash and cash equivalents(33,449) (35,700)(22,993) (33,449)
Cash and Cash Equivalents, Beginning of period
89,951
 133,351
142,135
 89,951
Cash and Cash Equivalents, End of period
$56,502
 $97,651
$119,142
 $56,502
Supplemental Disclosures of Cash Flow Information:      
Cash paid for interest$532
 $466
$593
 $532
Cash paid for income taxes, net$377
 $6,546
$337
 $377

The accompanying notes are an integral part of these condensed consolidated statements.

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Chico’s FAS, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
April 30, 201629, 2017
(Unaudited)

Note 1. Basis of Presentation
The accompanying unaudited condensed consolidated financial statements of Chico’s FAS, Inc. and its wholly-owned subsidiaries (collectively, the “Company”) have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and notes required by accounting principles generally accepted in the U.S. (“U.S. GAAP”) for complete financial statements. In the opinion of management, such interim financial statements reflect all normal, recurring adjustments considered necessary to present fairly the condensed consolidated financial position, the results of operations and cash flows for the interim periods presented. All significant intercompany balances and transactions have been eliminated in consolidation. For further information, refer to the consolidated financial statements and notes thereto for the fiscal year ended January 30, 2016,28, 2017, included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 8, 2016.7, 2017.
As used in this report, all references to “we,” “us,” “our,” and “the Company,” refer to Chico’s FAS, Inc. and all of its wholly-owned subsidiaries.
Our fiscal years end on the Saturday closest to January 31 and are designated by the calendar year in which the fiscal year commences. Operating results for the thirteen weeks ended April 30, 201629, 2017 are not necessarily indicative of the results that may be expected for the entire year.
ChangeAdoption of New Accounting Pronouncements
In the first quarter of 2017, we adopted the guidance of Accounting Standard Update (“ASU”) 2016-09, Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in Accounting Policy
Effective January 31, 2016, the Company made a voluntary change in accounting principlestatement of cash flows. The provision of ASU 2016-09 related to our classificationthe recognition of shipping expenses. Historically, we have presented shipping expenses within selling, generalexcess tax benefits and administrative expenses ("SG&A"). Under the new policy, the Company is presenting these expenses within cost of good sold ("COGS")deficiencies in the unaudited Condensed Consolidated Statementsincome statement was adopted on a prospective basis whereas the provision related to the classification in the statement of Income. The Company believes that this change is preferable ascash flows was adopted retrospectively and the shipping expenses represent direct costs associated with the sale of our merchandise and improves comparability with the Company's peers. The accounting policy change was applied retrospectively to allprior periods presented. There was no change to consolidated net income, however, cost of sales increased by $9.3 million and SG&A decreased by the same amount for the thirteen weeks ended May 2, 2015. The Company recorded $8.3 million in shipping expenses as a component of COGS during the thirteen weeks ended April 30, 2016.
Reclassification of Occupancy Expenses and Correction of Immaterial Accounting Error
were adjusted accordingly. The Company has changed its classification of store occupancy expenses. Historically, we have presented store occupancy expenses within SG&A. As now reclassified, the Company is presenting these expenses within COGS in the unaudited Condensed Consolidated Statements of Income. The Company believes that the store occupancy expenses represent direct costs associated with the sale of our merchandise and improves comparability with the Company’s peers. This reclassification was applied retrospectively to all periods presented. The Company recorded $95.8 million in store occupancy expenses as a component of COGS during the thirteen weeks ended April 30, 2016.
The Company has also elected to correctcontinue estimating forfeitures of share-based awards when determining compensation cost to be recognized each period. The adoption of ASU 2016-09 did not have a material impact on the historical classificationaccompanying condensed consolidated financial statements.

8

Table of shipping revenue within SG&A. To correct the immaterial error, we are classifying shipping revenue as a component of net sales within the unaudited Condensed Consolidated Statements of Income for all periods presented. The Company recorded $3.0 million in shipping revenue as a component of net sales during the thirteen weeks ended April 30, 2016.

Contents
Chico’s FAS, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
April 30, 201629, 2017
(Unaudited)

Adjustments to Presentation
The above mentioned changes had no cumulative effect on the presentation of the unaudited Condensed Consolidated Statements of Income, Condensed Consolidated Balance Sheets, or Condensed Consolidated Statements of Cash Flows. The effects of the aforementioned accounting policy change, change in classification and error correction to the May 2, 2015 unaudited Condensed Consolidated Statement of Income are as follows:
 As Previously Reported % of Sales Change in Accounting Policy Effect of Change in Occupancy Classification Effect of Error Correction As Adjusted % of Sales
              
Thirteen weeks ended May 2, 2015:            
Net sales$693,339
 100.0 $
 $
 $4,427
 $697,766
 100.0
Cost of goods sold297,569
 42.9 9,341
 95,238
 
 402,148
 57.6
Gross Margin395,770
 57.1 (9,341) (95,238) 4,427
 295,618
 42.4
Selling, general and administrative expenses328,217
 47.4 (9,341) (95,238) 4,427
 228,065
 32.7
Footnotes to the unaudited Condensed Consolidated Financial Statements herein have been adjusted to reflect the impact of these changes accordingly.

Note 2. New Accounting Pronouncements

In MarchOctober 2016, the Financial Accounting Standards Board ("FASB") issued ASU No. 2016-09, Compensation - Stock Compensation.2016-16, Accounting for Income Taxes: Intra-Entity Asset Transfers of Assets Other than Inventory. ASU 2016-092016-16 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016.2017. ASU 2016-092016-16 requires entitiescompanies to recognize the income tax effects of awardsintercompany sales or transfers of other assets in the income statement whenas income tax expense (benefit) in the awards vestperiod the sale or are settled. The standard also permits an employertransfer occurs. Additionally, companies would evaluate whether the tax effects of the intercompany sales of transfers of non-inventory assets should be included in their estimates of annual effective tax rates by using today's interim guidance on income tax accounting. ASU 2016-16 will require modified retrospective transition with a cumulative catch-up adjustment to repurchase moreopening retained earnings in the period of an employee's shares for tax withholding purposes without triggering liability accounting andadoption, which we expect to make a policy electionimplement in fiscal 2018. At April 29, 2017, the Company had $6.1 million in assets related to account for forfeitures as they occur. This standard will be effective and adopted for our first quarter 2017. We are currently assessing the new standard and its impact to our consolidated resultstransfer of operations, financial position and cash flows.intra–entity asset transfers.
In February 2016, the FASB issued ASU No. 2016-02, Leases, which replaces the existing guidance in Accounting Standard Codification 840, Leases. ASU 2016-02 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018.2018 and should be applied on a modified retrospective basis. ASU 2016-02 requires a dual approach for lessee accounting under which a lessee would account for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use asset and corresponding lease liability. For finance leases, the lessee would recognize interest expense and amortization of the right-of-use asset and for operating leases, the lessee would recognize straight-line total rent expense. We are currently assessingUpon adoption of the new standard in fiscal 2019, we expect to record material right–of–use assets and its impact to our consolidated resultslease liabilities on the balance sheet approximating the present value of operations, financial position and cash flows.the payments.
In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, under which entities will no longer be able to recognize unrealized holding gains and losses on equity securities they classify as available for saleavailable-for-sale in other comprehensive income but instead recognize the change in fair value in net income. The standard is effective for interim and annual reporting periods beginning after December 15, 2017. We are currently assessing the new standard, but do not at this time, anticipate adoption to have a material impact to our consolidated results of operations, financial position or cash flows.statements.
In July 2015, the Financial Accounting Standards Board ("FASB") issued ASU No. 2015-11, Simplifying the Measurement of Inventory (Topic 330). The amendments, which apply to inventory that is measured using any method other than the last-in, first-out (LIFO) or retail inventory method, require that entities measure inventory at the lower of cost or net realizable value. ASU 2015-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016 and should be applied on a prospective basis. We are currently assessing the potential impact of adopting this ASU, but do not, at this time, anticipate a material impact to our consolidated results of operations, financial position or cash flows.


Chico’s FAS, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
April 30, 2016
(Unaudited)

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers.Customers. The update outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. ASU 2014-09 requires entities to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration the entity expects to be entitled to in exchange for those goods or services. In August 2015, the FASB approved a one year deferral of the effective date, to make it effective for annual and interim reporting periods beginning after December 15, 2017. The standard allows for either a full retrospective or a modified retrospective transition method. The FASB has issued subsequent ASUs related to ASU No. 2014-09, which detail amendments to the ASU, implementation considerations, narrow-scope improvements and practical expedients. Through our evaluation of the impact of this ASU, we have identified certain changes that are expected to be made to our accounting policies, including: the timing of our recognition of advertising expenses, whereby certain expenses that are currently amortized over their expected period of future benefit will be expensed the first time the advertisement appears, and presentation of estimated merchandise returns as both an asset, equal to the inventory value net of processing costs, and a corresponding return liability, compared to the current practice of recording an estimated net return liability. We plan to adopt this ASU beginning in the first quarter of fiscal 2018 with a cumulative adjustment to retained earnings as opposed to retrospectively adjusting prior periods. We are currently assessingcontinuing to evaluate the new standardimpact this ASU, and its impact torelated amendments and interpretive guidance, will have on our consolidated results of operations, financial position and cash flows.statements.
    
Note 3. Restructuring and Strategic Charges
During the fourth quarter of fiscal 2014, we initiated a restructuring program, including the acceleration of domestic store closures and an organizational realignment, to ensure that resources align with long-term growth initiatives, including omni-channel.initiatives. In fiscal 2015, in connection with the restructuring program, we completed an evaluation of the Boston Proper brand, completed the sale of the Boston Proper direct-to-consumer business, and closed its stores. 

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Table of Contents
Chico’s FAS, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
April 29, 2017
(Unaudited)

During the first quarter of fiscal 2016, we announced an expansion ofexpanded our restructuring program to include components of our strategic initiatives that further align the organizational structure with long-term growth initiatives including transition of executive leadership, and to reduce COGScost of goods sold ("COGS") and selling, general and administrative expenses ("SG&A&A") through strategic initiatives. These strategic initiatives include realigning marketing and digital commerce, improving supply chain efficiency, and reducing non-merchandise expenses, optimizing marketing spend, and marketing expenses.transition of executive leadership. In connection with this program, during the first quarter of fiscal 2016, we recorded pre-tax restructuring and strategic charges of $3.7 million, primarily related to severance charges, continuing employee-related costs and consulting fees, which are included in restructuring and strategic charges in the accompanying condensed consolidated statementsstatement of income.
In Effective in the third quarter of fiscal 2016, we substantially completed our restructuring program and did not record any similar charges for the thirteen weeks ended April 29, 2017. We have closed 114 stores in connection with theour restructuring program we evaluated our domestic store portfolio and identified approximately 175 stores for closure, with 77 stores across our brands, including 20 Boston Proper stores, closed through the first quarter of fiscal 2016. As a result, we expect to incur additional cash charges related to lease termination expenses of approximately $1.6 million through fiscal 2017, related to these future closures.including 20 Boston Proper stores.
A summary of the pre-tax restructuring and strategic charges is presented in the table below:
Thirteen Weeks EndedThirteen Weeks Ended
April 30, 2016 May 2, 2015 April 30, 2016
     
(in thousands)(in thousands)
Impairment charges$
 $5,952
Continuing employee-related costs1,015
 5,625
 $1,015
Severance charges, net1,184
 1,634
Severance charges 1,184
Lease termination charges221
 
 221
Consulting fees and other1,231
 1,664
Outside services & other 1,231
Total restructuring and strategic charges, pre-tax$3,651
 $14,875
 $3,651
As of April 30, 2016,29, 2017, a reserve of $6.6$1.8 million related to restructuring and strategic activities was included in other current and deferred liabilities in the accompanying condensed consolidated balance sheets. A roll-forward of the reserve is presented as follows:
 Continuing employee-related costs Severance Charges Lease Termination Charges Consulting Fees and Other Total
          
 (in thousands)
Beginning Balance, January 30, 2016$2,549
 $1,678
 $1,101
 $9
 $5,337
Charges1,015
 1,184
 221
 1,231
 3,651
Payments(712) (1,289) (265) (164) (2,430)
Ending Balance, April 30, 2016$2,852
 $1,573
 $1,057
 $1,076
 $6,558
 Continuing Employee-related Costs Severance Charges Lease Termination Charges Outside Services
& Other
 Total
          
 (in thousands)
Beginning Balance, January 28, 2017$671
 $2,413
 $846
 $7,299
 $11,229
Payments(159) (1,780) (200) (7,299) (9,438)
Ending Balance, April 29, 2017$512
 $633
 $646
 $
 $1,791

Chico’s FAS, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
April 30, 2016
(Unaudited)

Note 4. Stock-Based Compensation
For the thirteen weeks ended April 29, 2017 and April 30, 2016, and May 2, 2015, stock-based compensation expense was $5.5$5.8 million and $7.6$5.5 million, respectively. As of April 30, 2016,29, 2017, approximately 5.34.1 million shares remain available for future grants of equity awards under our 2012 Omnibus Stock and Incentive Plan.

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Chico’s FAS, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
April 29, 2017
(Unaudited)

Restricted Stock Awards
Restricted stock award activity for the thirteen weeks ended April 30, 201629, 2017 was as follows:
Number of
Shares
 Weighted
Average
Grant Date
Fair Value
Number of
Shares
 Weighted
Average
Grant Date
Fair Value
Unvested, beginning of period2,585,392
 $16.60
2,463,186
 $13.87
Granted1,368,190
 12.56
1,172,690
 14.22
Vested(779,905) 17.19
(796,926) 15.10
Forfeited(229,038) 15.64
(58,141) 14.37
Unvested, end of period2,944,639
 14.64
2,780,809
 13.65
Performance-based Stock Units
For the thirteen weeks ended April 30, 2016,29, 2017, we granted performance-based restricted stock units (“PSUs”), contingent upon the achievement of a Company-specific performance goal during fiscal 2016.2017. Any units earned as a result of the achievement of this goal will vest over 3 years from the date of grant and will be settled in unvested shares of our common stock.stock on the first anniversary of the grant date, with shares vesting on the second and third anniversary dates.
Performance-based restricted stock unit activity for the thirteen weeks ended April 30, 201629, 2017 was as follows:
 Number of
Shares
 Weighted
Average
Grant Date
Fair Value
Unvested, beginning of period469,898
 $18.23
Granted733,360
 12.55
Vested(214,465) 18.23
Forfeited (1)
(183,608) 16.51
Unvested, end of period805,185
 13.45
(1) The performance goal for the PSUs granted in 2015 was not fully met. Forfeitures for the thirteen weeks ended April 30, 2016 include the portion of the fiscal 2015 PSUs that were not earned.
 Number of
Shares
 Weighted
Average
Grant Date
Fair Value
Unvested, beginning of period652,248
 $13.28
Granted601,052
 13.93
Vested(273,227) 13.54
Forfeited(51,222) 12.84
Unvested, end of period928,851
 13.65
 Stock Option Awards
For the thirteen weeks ended April 29, 2017 and April 30, 2016, and May 2, 2015, we did not grant any stock options.
Stock option activity for the thirteen weeks ended April 30, 201629, 2017 was as follows:
Number of
Shares
 Weighted
 Average
Exercise Price
Number of
Shares
 Weighted
 Average
Exercise Price
Outstanding, beginning of period1,060,774
 $15.17
577,246
 $13.58
Granted
 

 
Exercised(6,600) 8.24
(8,000) 10.15
Forfeited or expired(59,000) 27.78
(40,667) 15.25
Outstanding and exercisable at April 30, 2016995,174
 14.47
Outstanding and exercisable at April 29, 2017528,579
 13.51


Note 5. Income Taxes
The provision for income taxes is based on a current estimate of the annual effective tax rate and is adjusted as necessary for quarterly events. Our effective income tax rate may fluctuate from quarter to quarter as a result of a variety of factors, including changes in our assessment of certain tax contingencies, valuation allowances, changes in tax law, outcomes of administrative audits, the impact of discrete items, and the mix of earnings.

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Chico’s FAS, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
April 30, 201629, 2017
(Unaudited)

For the thirteen weeks ended April 29, 2017 and April 30, 2016, the effective tax rate was 38.2% and 37.9%, respectively. This 30 basis point increase includes the impact of the adoption of the new share-based payment accounting standard (the "Standard"). The impact of the Standard was a 50 basis point increase in the effective tax rate for the thirteen weeks ended April 29, 2017.

Note 5.6. Earnings Per Share
In accordance with relevant accounting guidance, unvested share-based payment awards that include non-forfeitable rights to dividends, whether paid or unpaid, are considered participating securities. As a result, such awards are required to be included in the calculation of earnings per common share pursuant to the “two-class” method. For us, participating securities are composed entirely of unvested restricted stock awards and PSUs that have met their relevant performance criteria.
Earnings per share (“EPS”) is determined using the two-class method when it is more dilutive than the treasury stock method. Basic EPS excludes dilution and is computed by dividing net income available to common stockholdersshareholders by the weighted-average number of common shares outstanding during the period, including participating securities. Diluted EPS reflects the dilutive effect of potential common shares from non-participating securities such as stock options and PSUs.
The following table sets forth the computation of basic and diluted EPS shown on the face of the accompanying condensed consolidated statements of operations (in thousands, except per share amounts):
Thirteen Weeks EndedThirteen Weeks Ended
April 30, 2016 May 2, 2015April 29, 2017 April 30, 2016
      
Numerator      
Net income$31,084
 $32,525
$33,619
 $31,084
Net income and dividends declared allocated to participating securities(646) (786)(741) (646)
Net income available to common shareholders$30,438
 $31,739
$32,878
 $30,438
Denominator      
Weighted average common shares outstanding – basic131,594
 143,378
126,050
 131,594
Dilutive effect of non-participating securities95
 393
53
 95
Weighted average common and common equivalent shares outstanding – diluted131,689
 143,771
126,103
 131,689
Net income per common share:   
Net income per share:   
Basic$0.23
 $0.22
$0.26
 $0.23
Diluted$0.23
 $0.22
$0.26
 $0.23
For the thirteen weeks ended April 29, 2017 and April 30, 2016, and May 2, 2015, 0.90.4 million and 0.70.9 million potential shares of common stock, respectively, were excluded from the diluted per share calculation relating to non-participating securities, because the effect of including these potential shares was antidilutive.

Note 6.7. Fair Value Measurements
Our financial instruments consist of cash, money market accounts, marketable securities, assets held in our non-qualified deferred compensation plan, accounts receivable and payable, and debt. Cash, accounts receivable and accounts payable are carried at cost, which approximates their fair value due to the short-term nature of the instruments.
Marketable securities are classified as available-for-sale and as of April 30, 201629, 2017 generally consist of corporate bonds, U.S. government agencies, corporate bonds, municipal securities, and commercial paper with $26.1$28.2 million of securities with maturity dates within one year or less and $24.4$22.4 million with maturity dates over one year and less than two years.
We consider all marketable securities available-for-sale, including those with maturity dates beyond 12 months, and therefore classify these securities within current assets on the condensed consolidated balance sheets as they are available to support current operational liquidity needs. Marketable securities are carried at fair value, with the unrealized holding gains and losses, net of income taxes, reflected in accumulated other comprehensive income until realized. For the purposes of computing realized and unrealized gains and losses, cost is determined on a specific identification basis.

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Chico’s FAS, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
April 29, 2017
(Unaudited)

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. Entities are required to use a three-level hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

Chico’s FAS, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
April 30, 2016
(Unaudited)

The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability on the measurement date. The three levels are defined as follows: 
 Level 1Unadjusted quoted prices in active markets for identical assets or liabilities
    
 Level 2Unadjusted quoted prices in active markets for similar assets or liabilities, or; Unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or; Inputs other than quoted prices that are observable for the asset or liability
    
 Level 3Unobservable inputs for the asset or liability
We measure certain financial assets at fair value on a recurring basis, including our marketable securities, which are classified as available-for-sale securities, certain cash equivalents, specifically our money market accounts, and assets held in our non-qualified deferred compensation plan. The money market accounts are valued based on quoted market prices in active markets. Our marketable securities are generally valued based on other observable inputs for those securities (including market corroborated pricing or other models that utilize observable inputs such as interest rates and yield curves) based on information provided by independent third party pricing entities, except for U.S. government securities which are valued based on quoted market prices in active markets. The investments in our non-qualified deferred compensation plan are valued using quoted market prices and are included in other assets on our condensed consolidated balance sheets.
From time to time, we measure certain assets at fair value on a non-recurring basis, including evaluation of long-lived assets, goodwill and other intangible assets for impairment using company-specificCompany-specific assumptions which would fall within Level 3 of the fair value hierarchy. We estimate the fair value of assets held for sale using market values for similar assets which would fall within Level 2 of the fair value hierarchy.
To assess the fair value of long-term debt, we utilize a discounted future cash flow model using current borrowing rates for similar types of debt of comparable maturities.
Fair value calculations contain significant judgments and estimates, which may differ from actual results due to, among other things, economic conditions, changes to the business model or changes in operating performance.
During the quarter ended April 30, 2016,29, 2017, we did not make any transfers between Level 1 and Level 2 financial instruments. Furthermore, as of April 29, 2017, January 28, 2017 and April 30, 2016, January 30, 2016 and May 2, 2015, we did not have any Level 3 financial instruments. We conduct reviews on a quarterly basis to verify pricing, assess liquidity, and determine if significant inputs have changed that would impact the fair value hierarchy disclosure.

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Chico’s FAS, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
April 30, 201629, 2017
(Unaudited)

In accordance with the provisions of the guidance, we categorized our financial instruments, which are valued on a recurring basis, based on the priority of the inputs to the valuation technique for the instruments, as follows:
  Fair Value Measurements at Reporting Date Using  Fair Value Measurements at Reporting Date Using
Balance as of April 30, 2016 Quoted Prices in Active Markets for Identical Assets
(Level 1)
 Significant Other Observable Inputs
(Level 2)
 Significant Unobservable Inputs
(Level 3)
Balance as of April 29, 2017 Quoted Prices in Active Markets for Identical Assets
(Level 1)
 Significant Other Observable Inputs
(Level 2)
 Significant Unobservable Inputs
(Level 3)
(in thousands)(in thousands)
Financial Assets:              
Current Assets              
Cash equivalents:              
Money market accounts$135
 $135
 $
 $
$375
 $375
 $
 $
Marketable securities:              
Municipal securities1,535
 
 1,535
 
6,774
 
 6,774
 
U.S. government agencies19,823
 
 19,823
 
20,024
 
 20,024
 
Corporate bonds24,892
 
 24,892
 
17,336
 
 17,336
 
Commercial paper4,229
 
 4,229
 
6,495
 
 6,495
 
Non Current Assets              
Deferred compensation plan7,785
 7,785
 
 
7,733
 7,733
 
 
Total$58,399
 $7,920
 $50,479
 $
$58,737
 $8,108
 $50,629
 $
              
Financial Liabilities:              
Long-term debt1
$89,735
 $
 $90,156
 $
$79,801
 $
 $80,120
 $
              
Balance as of January 30, 2016      Balance as of January 28, 2017      
Financial Assets:              
Current Assets              
Cash equivalents:              
Money market accounts$275
 $275
 $
 $
$471
 $471
 $
 $
Marketable securities:              
Municipal securities5,634
 
 5,634
 
U.S. government agencies21,800
 
 21,800
 
23,071
 
 23,071
 
Corporate bonds26,149
 
 26,149
 
15,799
 
 15,799
 
Commercial paper2,245
 
 2,245
 
5,866
 
 5,866
 
Non Current Assets              
Deferred compensation plan7,023
 7,023
 
 
7,523
 7,523
 
 
Total$57,492
 $7,298
 $50,194
 $
$58,364
 $7,994
 $50,370
 $
              
Financial Liabilities:              
Long-term debt$92,219
 $
 $92,647
 $
Long-term debt1
$84,785
 $
 $85,139
 $
              
Balance as of May 2, 2015      Balance as of April 30, 2016      
Financial Assets:       
Current Assets              
Cash equivalents:              
Money market accounts$1,840
 $1,840
 $
 $
$135
 $135
 $
 $
Marketable securities:              
Municipal securities3,078
 
 3,078
 
1,535
 
 1,535
 
U.S. government agencies14,303
 
 14,303
 
19,823
 
 19,823
 
Corporate bonds29,068
 
 29,068
 
24,892
 
 24,892
 
Commercial paper1,998
 
 1,998
 
4,229
 
 4,229
 
Non Current Assets              
Deferred compensation plan9,125
 9,125
 
 
7,785
 7,785
 
 
Total$59,412
 $10,965
 $48,447
 $
$58,399
 $7,920
 $50,479
 $
              
Financial Liabilities:              
Long-term debt124,000
 
 124,000
 
Long-term debt1
$89,735
 $
 $90,156
 $
1 The carrying value of long-term debt includes the current and long-term portions and the remaining unamortized discount of $0.3 million on thedebt issuance of debt.costs.

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Chico’s FAS, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
April 30, 201629, 2017
(Unaudited)

Note 7.8. Debt
In fiscal 2015, we entered into a credit agreement (the "Agreement)"Agreement") providing for a term loan of $100.0 million and a revolving credit facility of $100.0 million. The term loan and revolving credit facility mature on May 4, 2020 and accrue interest by reference, at our election, at either an adjusted eurodollar rate tied to LIBOR or an Alternate Base Rate plus an interest rate margin, as defined in the Agreement. The Agreement contains customary representations, warranties, and affirmative covenants, including the requirement to maintain certain financial ratios. The Company was in compliance with the applicable ratio requirements and other covenants at April 30, 2016.29, 2017. As of April 30, 2016,29, 2017, we had total available borrowing capacity of $100.0 million under our revolving credit facility.
The following table provides detailsadditional detail on our debt outstanding as of April 30, 2016, January 30, 2016 and May 2, 2015:debt:
April 30, 2016 January 30, 2016 May 2, 2015
     April 29, 2017 January 28, 2017 April 30, 2016
(in thousands)(in thousands)
Credit Agreement, net$89,735
 $92,219
 $124,000
$79,801
 $84,785
 $89,735
Less: current portion(10,000) (10,000) (34,000)(15,000) (16,250) (10,000)
Total long-term debt$79,735
 $82,219
 $90,000
$64,801
 $68,535
 $79,735

Note 8.9. Share Repurchases
During the thirteen weeks ended April 30, 2016, we repurchased 3.2 million shares,29, 2017, under our $300 million share repurchase program announced in November 2015, we repurchased 0.7 million shares at a total cost of approximately $36.6 million.$9.5 million, at a weighted average of $13.65 per share. As of April 30, 2016,29, 2017, the Company has $223.4$154.1 million remaining for future repurchases under the share repurchase program. However, we have no continuing obligation to repurchase shares under this authorization, and the timing, actual number and value of any additional shares to be purchased will depend on the performance of our stock price, market conditions and other considerations.

Note 9. Subsequent Events10. Commitments and Contingencies
In July 2015, the Company was named as a defendant in Altman v. White House Black Market, Inc., a putative class action filed in the United States District Court for the Northern District of Georgia. The Complaint alleges that the Company, in violation of federal law, published more than the last five digits of a credit or debit card number or an expiration date on customers' receipts. The Company denies the material allegations of the complaint. Its motion to dismiss was denied on July 13, 2016, but the Company continues to believe that the case is without merit. It will continue to vigorously defend the matter. At this time, it is not awarepossible to predict whether the proceeding will be permitted to proceed as a class or the size of any material subsequent events which would require recognitionthe putative class, and no assurance can be given that the Company will be successful in its defense on the merits or disclosureotherwise. No specific dollar amount in damages or other relief is specified in the condensedComplaint, and the Company is unable to estimate any potential loss or range of loss. However, if the case were to proceed as a class action and the Company were to be unsuccessful in its defense on the merits, the ultimate resolution of the case could have a material adverse effect on the Company’s consolidated financial condition or results of operations.
In June 2015, the Company was named as a defendant in Ackerman v. Chico’s FAS, Inc., a putative representative Private Attorney General action filed in the Superior Court of California, County of Los Angeles. The Complaint alleges numerous violations of California law related to wages, meal periods, rest periods, wage statements and failure to reimburse business expenses, among other things. Plaintiff subsequently amended her complaint to make the same allegations on a class action basis. In June 2016, the parties submitted a proposed settlement of the matter to the court. The court granted preliminary approval on August 26, 2016, and settlement notices were distributed. On May 16, 2017, the court finally approved the settlement substantially on the terms submitted by the parties. The settlement will not have a material adverse effect on the Company’s consolidated financial condition or results of operations.
In July 2016, the Company was named as a defendant in Calleros v. Chico’s FAS, Inc., a putative class action filed in the Superior Court of California, County of Santa Barbara. Plaintiff alleges that the Company failed to comply with California law requiring it to provide consumers cash for gift cards with a stored value of less than $10.00. Following voluntary mediation of the matter in November of 2016, the parties entered into a settlement agreement, which was approved preliminarily by the court on March 28, 2017. If finally approved, the settlement will not have a material adverse effect on the Company’s consolidated financial condition or results of operations.

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Chico’s FAS, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
April 29, 2017
(Unaudited)

Other than as noted above, we are not currently a party to any legal proceedings other than claims and lawsuits arising in the normal course of business. All such matters are subject to uncertainties and outcomes may not be predictable. Consequently, the ultimate aggregate amount of monetary liability or financial impact with respect to these matters as of April 29, 2017 are not estimable. However, while such matters could affect our consolidated operating results when resolved in future periods, management believes that upon final disposition, any monetary liability or financial impact to us would not be material to our annual consolidated financial statements.


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ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and notes thereto and our 20152016 Annual Report to Stockholders.Shareholders.

Executive Overview
We are a leading omni-channel specialty retailer of women’s private branded, sophisticated, casual-to-dressy clothing, intimates and complementary accessories, and other non-clothing items operating under the Chico’s, White House Black Market (“WHBM”) and Soma brand names. We earn revenues and generate cash through the sale of merchandise in our domestic and international retail stores, on our various websites throughand our call center, which takes orders for all of our brands, and through an unaffiliated franchise partner in Mexico.
We utilize an integrated, omni-channel approach to managing our business. We want our customers to experience our brands not limitedholistically and to a channel within our brands, and view our various salesretail channels as a single, integrated processexperience rather than as separate sales channels operating independently. This approach allows our customers to browse, purchase, return, or exchange our merchandise through whatever sales channel and at whatever time is most convenient. As a result, we track total sales and comparable sales on a combined basis.
Net
First Quarter of Fiscal 2017 FinancialHighlights
Delivered first quarter EPS of $0.26, compared to $0.23 EPS in last year's first quarter
Reduced SG&A by $25.6 million, improving sales leverage by 110 basis points
Achieved 150 basis point improvement in income from operations
Income from Operations and Select Charges
The following table depicts income from operations and restructuring and strategic charges for the first quarter of fiscal 2016 were $643.0 million compared to $697.8 million in last year's first quarter. This decrease of 7.9% included $25.3 million related to Boston Proper2017 and reflected a 4.2% decrease in comparable sales and 35 net store closures, or a 1.9% net decrease in selling square footage. Included in the 35 net store closures were 20 Boston Proper stores. The 4.2% decrease in comparable sales for the first quarter was following a 0.1% decrease in last year’s first quarter, reflecting a decrease in average dollar sale and transaction count.2016:
We reported net income
 Thirteen Weeks Ended
 April 29, 2017April 30, 2016
    
 (dollars in millions)
Income from operations$54.9
 $50.5
Restructuring and strategic charges
 3.7

Earnings per diluted share for the first quarter of fiscal 2016 of $31.1 million, or $0.23 per diluted share,2017 was $0.26 compared to $0.23 in last year's first quarter. The change in earnings per share reflects the increase in net income and the impact of $32.5approximately 5.6 million or $0.22 per diluted share, in last year’s first quarter. Results forshares repurchased since the end of the first quarter of fiscal 2016 include the impact of restructuring and strategic charges primarily consisting of executive transition costs and consulting fees of $2.3 million after-tax, or $0.02 per diluted share. Results for the first quarter of fiscal 2015 include the impact of restructuring and strategic charges primarily consisting of employee-related costs and property and equipment impairment charges of $9.3 million after-tax, or $0.06 per diluted share, and the Boston Proper operating loss of $2.7 million, or $0.02 per diluted share.last year.
Our Business Strategy
Our overall business strategy is focused on building and cultivating a portfoliocollection of distinct high-performing retail brands serving the fashion needs of women ages 35 years and older.We are focused on increasing the sales volume and profitability of our existing brandsolder. We seek to accomplish this strategy through our four focus areas: (1) evolving the customer experience, (2) strengthening our brands' positions, (3) leveraging actionable retail science, and (4) sharpening our financial principles. Over the long term, we may build our brand portfolio by organic development or acquisition of other specialty retail concepts if research indicates that the opportunity complements our current brands and is appropriate and in the best interest of the shareholders.
We pursue improving the growthperformance of theour brands in our portfolio by building our omni-channel capabilities, which includes managing our store base and growing our growing online presence, by executing marketing plans, by effectively leveraging expenses and by optimizing the potentialmerchandise offerings of each of our three brands. We have investedcontinue to invest heavily in our omni-channel capabilities in order to allow customers to fully experience our brands and not just a channel within our brands.through more than one channel. In essence, we view our various sales channels as a single, integrated process rather than as separate sales channels operating independently. To that end, we often refer to our brands' respective websites as "our largest store" within the brand.

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Under this integrated, omni-channel approach, we encourage our customers to take advantage of each of our sales channels in whatever way best fits their needs. Customers may shop our products through one channel and consummate the purchase through a different channel. Our domestic customers have the option of returning merchandise to a store or to our distribution center, regardless of the channel used for purchase. We believe this omni-channel approach meets our customers’ expectations, enhances the customer experience, contributes to the overall success of our brands, reflects that our customers do not differentiate between channels, and is consistent with how we plan and manage our business. As a result, we maintain a shared inventory platform for our operations, allowing us to fulfill orders for all channels from our distribution center in Winder, Georgia. We also fulfill in-store orders directly from other stores or our distribution center and offer domestic online and catalog customers the option of returning items to our stores.

center.
We seek to acquire and retain omni-channel customers by leveraging existing customer-specific data and through targeted marketing, including e-marketing, television, catalogs and mailers. We seek to optimize the potential of our brands with improved product offerings, which includes potential new merchandise opportunities and brand extensions that complementenhance the current offerings, as well as our continued emphasis on our “Most Amazing Personal Service” standard.
In 2016, we announced newand began implementing cost reduction and operating efficiency initiatives, to realignincluding realigning marketing and digital commerce, improveimproving supply chain efficiency, reducing non-merchandise expenses, and reduce non-merchandise andoptimizing marketing expenses.spend. Actions taken as part of these initiatives are expected to continue to reduce expenses and complexity, and standardize processes across the Company. These initiatives are expected toand improve the Company's ability to respond in real-time to changes in customer demand for merchandise.
Fiscal 2017 Outlook
Mid single-digit percentage decline in comparable sales for the year
Gross margin as a percent of net sales flat to up to a 30 basis point increase for the year
Approximately flat SG&A leverage for the year
Capital expenditures approximating $60-$70 million for the year
Decrease in on-hand inventory each quarter compared to last year


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RESULTS OF OPERATIONS
Thirteen Weeks Ended April 30, 201629, 2017 Compared to the Thirteen Weeks Ended May 2, 2015April 30, 2016
Net Sales
The following table depicts net sales by Chico’s, WHBM Soma and Boston ProperSoma in dollars and as a percentage of total net sales for the thirteen weeks ended April 29, 2017 and April 30, 2016 and May 2, 2015:2016:
Thirteen Weeks EndedThirteen Weeks Ended
April 30, 2016 May 2, 2015April 29, 2017 April 30, 2016
        
(dollars in thousands)(dollars in millions)
Chico's$348,704
 54.2% $369,859
 53.0%$310
 53.1% $349
 54.2%
WHBM214,993
 33.5
 225,442
 32.3
193
 33.1
 215
 33.5
Soma79,280
 12.3
 77,167
 11.1
80
 13.8
 79
 12.3
Boston Proper
 
 25,298
 3.6
Total net sales$642,977
 100.0% $697,766
 100.0%$584
 100.0% $643
 100.0%
Net sales forFor the first quarter, decreasednet sales were $584 million compared to $643.0 million from $697.8$643 million in last year’s first quarter. This 7.9% decrease includes $25.3 million related to Boston Proper in last year’s first quarter andof 9.2% primarily reflects a 4.2% decreasedecline in comparable sales.sales of 8.7%, driven by lower average dollar sales and a decline in transaction count. Net sales also reflects 3525 net store closures, including 20 Boston Proper store closures, or a 1.9%1.5% net decrease in selling square footage, since last year's first quarter. The 4.2% decrease in comparable sales for the first quarter was following a 0.1% decrease in last year’s first quarter,reflecting a decrease in average dollar sale and transaction count.
The following table depicts comparable sales percentages by Chico's, WHBM and Soma for the thirteen weeks ended April 29, 2017 and April 30, 2016 and May 2, 2015:2016:
Thirteen Weeks EndedThirteen Weeks Ended
April 30, 2016 May 2, 2015April 29, 2017 April 30, 2016
Chico's(5.4)% (2.3)%(10.0)% (5.4)%
WHBM(3.8) 1.7
(9.7) (3.8)
Soma0.5
 6.5
0.2
 0.5
Total Company(4.2)% (0.1)%(8.7)% (4.2)%
Cost of Goods Sold/Gross Margin
The following table depicts cost of goods soldCOGS and gross margin in dollars and gross margin as a percentage of total net sales for the thirteen weeks ended April 29, 2017 and April 30, 2016 and May 2, 2015:2016:
Thirteen Weeks EndedThirteen Weeks Ended
April 30, 2016 May 2, 2015April 29, 2017 April 30, 2016
      
(dollars in thousands)(dollars in millions)
Cost of goods sold$380,642
 $402,148
$346
 $381
Gross margin$262,335
 $295,618
237
 262
Gross margin percentage40.8% 42.4%40.7% 40.8%

For the first quarter of fiscal 2016,2017, gross margin was $262.3$237 million, or 40.7% of net sales, compared to $295.6$262 million, or 40.8% of net sales, in last year’s first quarter. Gross margin was 40.8% of net sales, compared to 42.4% in the first quarter of fiscal 2015. TheThis 10 basis point decrease is primarily due to increased promotional activity in response to lower traffic andreflects sales deleverage of store occupancy expenses, partiallysubstantially offset by reduced incentive compensation.an improvement in merchandise margin.

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Selling, General and Administrative Expenses
The following table depicts SG&A, which includes store and direct operating expenses, marketing expenses and National Store Support Center (“NSSC”) expenses, in dollars and as a percentage of total net sales for the thirteen weeks ended April 29, 2017 and April 30, 2016 and May 2, 2015:2016:
Thirteen Weeks EndedThirteen Weeks Ended
April 30, 2016 May 2, 2015April 29, 2017 April 30, 2016
      
(dollars in thousands)(dollars in millions)
Selling, general and administrative expenses$208,141
 $228,065
$183
 $208
Percentage of total net sales32.4% 32.7%31.3% 32.4%

For the first quarter of fiscal 2016,2017, SG&A was $208.1$183 million, or 31.3% of net sales, compared to $228.1$208 million, in last year’s first quarter. SG&A was 32.4% of net sales, a 30 basis pointin last year's first quarter. This $26 million decrease from last year’s first quarter, primarily reflecting $13.0 millionreflects savings in store related expenses, lower marketing spend and the benefit of SG&A related to Boston Proper in the first quarter of fiscal 2015, and lower store labor, marketing expenses and incentive compensation, reflecting a slight decline in SG&A rate.other previously announced cost reduction initiatives.
Restructuring and Strategic Charges
In the fourth quarter of fiscal 2014, we initiated a restructuring program, including the acceleration of domestic store closures and an organizational realignment, to ensure that resources are alignedalign with long-term growth initiatives, including omni-channel.initiatives. During the first quarter of fiscal 2016, we announced an expansion of our restructuring program to further align the organizational structure with long-term growth initiatives, including transition of executive leadership, and to reduce COGS and SG&A through strategic initiatives. These strategic initiatives include realigning marketing and digital commerce, improving supply chain efficiency, and reducing non-merchandise and marketing expenses.
In connection with this effort, in the first quarter of fiscal 2016, we recorded pre-tax restructuring and strategic charges of $3.7 million, primarily related to severance charges, continuing employee-related costs and consulting fees.fees, which are included in restructuring and strategic charges in the accompanying condensed statement of income. The fiscal 2016 after-tax impact of the restructuring and strategic charges in the first quarter totaled $2.3 million, or $0.02 per diluted share.
In Effective in the third quarter of fiscal 2016, we substantially completed our restructuring program and did not record any similar charges for the first quarter of fiscal 2017. We have closed 114 stores in connection with theour restructuring program we evaluated our domestic store portfolio and identified approximately 175 stores for closure, with 77 stores across our brands, including 20 Boston Proper stores, closed through the first quarter of fiscal 2016. As2017, including 20 Boston Proper stores.
Provision for Income Taxes
For the thirteen weeks ended April 29, 2017 and April 30, 2016, the effective tax rate was 38.2% and 37.9%, respectively. This 30 basis point increase includes the impact of the adoption of the new employee share-based payment accounting standard (the "Standard"). The impact of the Standard was a result, we expect to incur additional cash charges related to lease termination expenses of approximately $1.6 million through fiscal 2017 related to these future closures.50 basis point increase in the effective tax rate for the thirteen weeks ended April 29, 2017.
Net Income and Earnings Per Diluted Share
We reported net income for the first quarter of fiscal 20162017 of $31.1$33.6 million, or $0.23$0.26 per diluted share, compared to net income of $32.5$31.1 million, or $0.22$0.23 per diluted share in last year’s first quarter. Results for the first quarter of fiscal 2016 include the impact of restructuring and strategic charges primarily related to executive transition costs and consulting fees of $2.3 million after-tax, or $0.02 per diluted share. Results for the first quarter of fiscal 2015 include the impact ofshare, related to restructuring and strategic charges primarily related to employee-related costs and property and equipment impairment charges of $9.3 million after-tax, or $0.06 per diluted share, and the Boston Proper operating loss of $2.7 million, or $0.02 per diluted share.charges. The change in earnings per share also reflects the impact of 3.2approximately 5.6 million shares repurchased insince the end of the first quarter of fiscal 2016 and 18.3 million shares repurchased in fiscal 2015,last year.
Inventories
At the end of which 10.7 million shares were repurchased in the first quarter of fiscal 2015.

2017, inventories totaled $273.9 million compared to $268.0 million in the same period last year. The $5.9 million increase in inventories primarily reflected a $10.5 million increase in in-transit inventories, largely due to a shift in shipping terms with a major vendor, partially offset by a 2.0% decrease in on-hand inventories compared to the same period last year.

Liquidity and Capital Resources
We believe that our existing cash and marketable securities balances, cash generated from operations, available credit facilities and potential future borrowings will be sufficient to fund capital expenditures, working capital needs, dividend payments, potential share repurchases, commitments, and other liquidity requirements associated with our operations for the foreseeable future. Furthermore, while it is our intention to repurchase our stock and pay a quarterly cash dividend in the future, any determination to repurchase additional shares of our stock or pay future dividends will be made by the Board of Directors and will depend on our stock price, future earnings, financial condition, and other factors considered by the Board.
Our ongoing capital requirements will continue to be primarily for enhancing and expanding our omni-channel capabilities, including: information technology and relocated, remodeled and new stores.

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Operating Activities
Net cash provided by operating activities for the first quarter of fiscal 20162017 was $32.6$16.7 million, a decrease of approximately $9.1$16.0 million from last year's first quarter. This decrease is primarily due to property and equipment impairment charges in the prior year and decreases in depreciation and amortization. The changes in working capital primarily reflected the timing of payables and income taxes partially offset by a decreaseand other receivables, payments made in accruedfiscal 2017 for outside services related to our previously announced restructuring program, and the impact of higher incentive compensation.compensation payments in fiscal 2017 for fiscal 2016 performance.
Investing Activities
Net cash used in investing activities for the first quarter of fiscal 20162017 was $13.3$9.8 million compared to $58.3$13.3 million provided by investing activities in last year's first quarter,quarter. This decrease primarily reflectingreflected a $78.3$3.5 million decreasedecline in marketable securities related to the partial funding of the accelerated share repurchase agreements in fiscal 2015. Investing activities in the first quarter of fiscal 2016 included net purchases of property and equipment totaling $13.1 million compared to $19.8 million in the same period last year, consistent with our overall business strategy.
Financing Activities
Net cash used in financing activities for the first quarter of fiscal 20162017 was $52.8$29.9 million compared to $135.5$52.8 million in last year's first quarter. The decrease in net cash used in financing activities primarily reflects a decrease of $217.8$27.1 million in share repurchases, in fiscal 2016 compared to fiscal 2015, partially offset by net borrowingspayments of $124.0$2.5 million under our Credit Agreement in fiscal 2015.Agreement.
Store and Franchise Activity
During the first quarter of fiscal 2016,2017, we had 19 net store closure,closures, consisting of net closures of 4 Chico's and 1stores, 4 WHBM stores and openings of 41 Soma stores.store. Currently, we expect an additional 2538 net store closures in fiscal 2016,2017, reflecting approximately 2015 net closures of Chico's stores, 1018 net closures of WHBM stores, and 5 net openingsclosures of Soma stores. We continuously evaluate the appropriate new store growth ratepositioning in light of economic conditions and may adjust the growth rateour strategy as conditions require or as opportunities arise. As of April 30, 2016,29, 2017, we also sold merchandise through 7763 Chico's and 30 Soma international franchise locations.

Critical Accounting Policies and Estimates
The discussion and analysis of our financial condition and results of operations are based upon the condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue, expenses, and related disclosure of contingent assets and liabilities. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Management has discussed the development and selection of these critical accounting policies and estimates with the Audit Committee of our Board of Directors and believes the assumptions and estimates, as set forth in our Annual Report on Form 10-K for the fiscal year ended January 30, 2016,28, 2017, are significant to reporting our results of operations and financial position.
In fiscal 2016 we implemented changes to our accounting policy for the classification of shipping expense, corrected an immaterial error in the classification of shipping revenue and changed the classification of occupancy expenses. Please see Note 1 in our Notes to Condensed Consolidated Financial Statements for a detailed description and reconciliation of these matters.
Other than discussed above, there There have been no material changes to our critical accounting policies as disclosed in our Annual Report on Form 10-K for the fiscal year ended January 30, 2016.28, 2017.


Forward-Looking Statements
This Form 10-Q may contain certain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which reflect our current views with respect to certain events that could have an effect on our future financial performance, including but without limitation, statements regarding our plans, objectives, the implementation of our previously announced restructuring program and organizational redesign for improved business performance, including our re-balancing of our store fleet and streamlining the headquarter workforce and product life cycle process, and the future success of our store concepts. These statements may address items such as future sales and sales initiatives, gross margin expectations, SG&A expectations (particularly estimated expected savings), operating margin expectations, earnings per share expectations, planned store openings, closings and expansions, expected impact of ongoing litigation, future stock repurchase plans, future plans to pay dividends, future comparable sales, future product sourcing plans, inventory levels, planned marketing expenditures, planned capital expenditures and future cash needs. In addition, from time to time, we may issue press releases and other written communications, and our representatives may make oral statements, which contain forward-looking information.

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These statements including those in this Form 10-Q and those in press releases or made orally, relate to expectations concerning matters that are not historical fact and may include the words or phrases such as “will,” “should,” “expects,” “believes,” “anticipates,” “plans,” “estimates,” “approximately,” “our planning assumptions,” “future outlook,” and similar expressions. Except for historical information, matters discussed in such oral and written statements, including this Form 10-Q are forward-looking statements. These forward-looking statements are based largely on information currently available to our management and on our current expectations, assumptions, plans, estimates, judgments and projections about our business and our industry, and are subject to various risks and uncertainties that could cause actual results to differ materially from historical results or those currently anticipated. Although we believe our expectations are based on reasonable estimates and assumptions, they are not guarantees of performance and there are a number of known and unknown risks, uncertainties, contingencies, and other factors (many of which are outside our control) that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Accordingly, there is no assurance that our expectations will, in fact, occur or that our estimates or assumptions will be correct, and we caution investors and all others not to place undue reliance on such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those described in Item 1A, “Risk Factors” in our Annual Report on Form 10-K filed with the SEC on March 8, 20167, 2017 and the following:
These potential risks and uncertainties include: theThe financial strength of retailing in particular and the economy in general; the extent of financial difficulties or economic uncertainty that may be experienced by customers; our ability to secure and maintain customer acceptance of styles and storein-store and online concepts; the ability to effectively manage and maintain an appropriate level of inventory; the extent and nature of competition in the markets in which we operate; the extent of the market demand and overall level of spending for women’s private branded clothing and related accessories; the effectiveness of our brand awareness and marketing programs; the adequacy and perception of customer service; the ability to respond to actions of activist shareholders and others; the ability to coordinate product development with buying and planning; the quality and timeliness of merchandise received from suppliers; the ability to efficiently, timely and successfully executemanage our business in the face of significant economic, labor, political or other shifts in the countries from which our merchandise is supplied; the ability of our suppliers to timely produce and deliver clothing and accessories; the changes in the costs of manufacturing, raw materials, transportation, distribution, labor and advertising; the availability of quality store sites; our ability to manage our store fleet and the risk that our investments in shoppingmerchandise or marketing initiatives may not deliver the results we anticipate; our ability to successfully navigate the riskincreasing use of on-line retailers for fashion purchases and the pressure that comparable salesputs on traffic and margins will experience fluctuations;transactions in our physical stores; the ability to operate our own retail websites in a manner that produces profitable sales; the ability to successfully execute our business strategies;strategies, including our previously announced restructuring program and expense initiatives, and to achieve the expected results from them; the continuing performance, implementation and integration of management information systems; the impact of any systems failures, cyber security or other data or security breaches, including any security breaches that result in theft, transfer, or unauthorized disclosure of customer, employee, or company information or our compliance with information security and privacy laws and regulations in the event of such an incident; the ability to hire, train, energizemotivate and retain qualified sales associates, managerial employees and other employees; the successful integration of our new management team; the ability to achieve the resultsrespond effectively to actions of our previously announced restructuring program;activist shareholders and others; the ability to expandutilize our distribution center and other support facilities in an efficient and effective manner; the ability to effectively and efficiently establish our websites; the ability to secure and protect trademarks and other intellectual property rights and to protect our reputation and brand images; and the risk that natural disasters, public health crises, political rises,uprisings, uncertainty or unrest, or other catastrophic events could adversely affect our operations and financial results. In addition, there areresults; potential risks and uncertainties that are related to our reliance on sourcing from foreign suppliers, including the impact of work stoppages; transportation delays and other interruptions; political or civil instability; imposition of and changes in tariffs, andtaxes (such as the passage of a “border adjustment” or similar tax) or other import and export controls such as import quotas;regulations; changes in governmental policies in or towards foreign countries; currency exchange rates and other similar factors.factors; and the impact of our recent shift to a predominantly FOB (free on board) shipping structure.
All written or oral forward-looking statements that are made or attributable to us are expressly qualified in their entirety by this cautionary notice. The forward-looking statements included herein are only made as of the date of this Quarterly Report on Form 10-Q. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The market risk of our financial instruments as of April 30, 201629, 2017 has not significantly changed since January 30, 2016.28, 2017. We are exposed to market risk from changes in interest rates on any future indebtedness and our marketable securities and from foreign currency exchange rate fluctuations.
Our exposure to interest rate risk relates in part to our revolving line of credit with our bank. On May 4,In 2015, we entered into a credit agreement, as further discussed in Note 7.8. The Agreement, which matures on May 4, 2020, has borrowing options which accrue interest by reference, at our election, at either an adjusted eurodollar rate tied to LIBOR or an Alternate Base Rate plus an interest rate margin, as defined in the Agreement. An increase or decrease in market interest rates of 100 basis points would not have a material effect on annual interest expense. 
Our investment portfolio is maintained in accordance with our investment policy which identifies allowable investments, specifies credit quality standards and limits the credit exposure of any single issuer. Our investment portfolio consists of cash equivalents and marketable securities including municipal securities, corporate bonds, U.S. government agencies and commercial paper. The marketable securities portfolio as of April 30, 2016,29, 2017, consisted of $26.1$28.2 million of securities with maturity dates within one year or less and $24.4$22.4 million with maturity dates over one year and less than or equal to two years. We consider all marketable securities available-for-sale, including those with maturity dates beyond 12 months, and therefore classify these securities as short-term investments within current assets on the condensed consolidated balance sheets as they are available to support current operational liquidity needs. As of April 30, 2016,29, 2017, an increase or decrease of 100 basis points in interest rates would not have a material effect on the fair value of our marketable securities portfolio.

ITEM 4.CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Our disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed in our reports under the Securities and Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.
As of the end of the period covered by this report, an evaluation was carried out under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as amended). Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of the end of such period, our disclosure controls and procedures were effective in providing reasonable assurance in timely alerting them to material information relating to us (including our consolidated subsidiaries) and that information required to be disclosed in our reports is recorded, processed, summarized, and reported as required to be included in our periodic SEC filings.
Changes in Internal Controls
There were no significant changes in our internal controls or in other factors that could significantly affect our disclosure controls and procedures subsequent to the date of the above referenced evaluation. Furthermore, there was no change in our internal control over financial reporting or in other factors during the quarterly period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.


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PART II – OTHER INFORMATION
 
ITEM 1.LEGAL PROCEEDINGS
In June 2015, the Company was named as a defendant in a putative representative Private Attorney General action filed in the Superior Court of California, County of Los Angeles, Ackerman v. Chico's FAS, Inc.  The Complaint attempts to allege numerous violations of California law related to wages, meal periods, rest periods, wage statements, and failure to reimburse business expenses, among other things. The Company denies the material allegations of the Complaint and filed its Answer on July 27, 2015. The Company believes that the case is without merit and intends to vigorously defend. As a result, the Company does not believe that the case should have a material adverse effect on the Company’s consolidated financial condition or results of operations.
In July 2015, the Company was named as a defendant in Altman v. White House Black Market, Inc., a putative class action filed in July 2015 in the United States District Court for the Northern District of Georgia, Altman v. White House Black Market, Inc.Georgia. The Complaint alleges that the Company, in violation of federal law, published more than the last five digits of a credit or debit card number or an expiration date on customers' receipts.The Company denies the material allegations of the complaint and filed acomplaint. Its motion to dismiss was denied on September 9, 2015, which is pending. TheJuly 13, 2016, but the Company believescontinues to believe that the case is without merit and​ intendsmerit. It will continue to vigorously defend. Asdefend the matter. At this time, it is not possible to predict whether the proceeding will be permitted to proceed as a result,class or the size of the putative class, and no assurance can be given that the Company doeswill be successful in its defense on the merits or otherwise. No specific dollar amount in damages or other relief is specified in the Complaint, and the Company is unable to estimate any potential loss or range of loss. However, if the case were to proceed as a class action and the Company were to be unsuccessful in its defense on the merits, the ultimate resolution of the case could have a material adverse effect on the Company’s consolidated financial condition or results of operations.
In June 2015, the Company was named as a defendant in Ackerman v. Chico’s FAS, Inc., a putative representative Private Attorney General action filed in the Superior Court of California, County of Los Angeles. The Complaint alleges numerous violations of California law related to wages, meal periods, rest periods, wage statements and failure to reimburse business expenses, among other things. Plaintiff subsequently amended her complaint to make the same allegations on a class action basis. In June 2016, the parties submitted a proposed settlement of the matter to the court. The court granted preliminary approval on August 26, 2016, and settlement notices were distributed. On May 16, 2017, the court finally approved the settlement substantially on the terms submitted by the parties. The settlement will not believehave a material adverse effect on the Company’s consolidated financial condition or results of operations.
In July 2016, the Company was named as a defendant in Calleros v. Chico’s FAS, Inc., a putative class action filed in the Superior Court of California, County of Santa Barbara. Plaintiff alleges that the case shouldCompany failed to comply with California law requiring it to provide consumers cash for gift cards with a stored value of less than $10.00. Following voluntary mediation of the matter in November of 2016, the parties entered into a settlement agreement, which was approved preliminarily by the court on March 28, 2017. If finally approved, the settlement will not have a material adverse effect on the Company’s consolidated financial condition or results of operations.
Other than as noted above, we are not currently a party to any legal proceedings other than claims and lawsuits arising in the normal course of business. All such matters are subject to uncertainties and outcomes may not be predictable. Consequently, the ultimate aggregate amount of monetary liability or financial impact with respect to these matters as of April 30, 201629, 2017 are not estimable. However, while such matters could affect our consolidated operating results when resolved in future periods, management believes that upon final disposition, any monetary liability or financial impact to us would not be material to our annual consolidated financial statements.

ITEM 1A.RISK FACTORS
In addition to the other information discussed in this report, the factors described in Part I, Item 1A. “Risk Factors” in our 20152016 Annual Report on Form 10-K filed with the SEC on March 8, 20167, 2017 should be considered as they could materially affect our business, financial condition or future results. Other than as noted below, thereThere have not been any significant changes with respect to the risks described in our 20152016 Form 10-K, but these are not the only risks facing our company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may adversely affect our business, financial condition or operating results.


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ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
The following table sets forth information concerning our purchases of common stock for the periods indicated (amounts in thousands, except share and per share amounts):
PeriodTotal
Number of
Shares
Purchased (a)
 Average Price
Paid per Share
 Total Number
of Shares
Purchased as
Part of
Publicly
Announced
Plans (b)
 Approximate Dollar
Value of Shares that
May Yet Be
Purchased Under
the Publicly
Announced  Plans
January 31, 2016 - February 27, 20161,790,037
 $10.42
 1,783,250
 $241,430
February 28, 2016 - April 2, 2016562,958
  12.81
 255,300
  238,159
April 3, 2016 - April 30, 20161,159,764
  12.75
 1,159,764
  223,367
Total3,512,759
  11.57
 3,198,314
  223,367
PeriodTotal
Number of
Shares
Purchased (a)
 Average Price
Paid per Share
 Total Number
of Shares
Purchased as
Part of
Publicly
Announced
Plans (b)
 Approximate Dollar
Value of Shares that
May Yet Be
Purchased Under
the Publicly
Announced Plans
January 29, 2017 - February 25, 2017712,815
 $13.67
 695,672
 $154,144
February 26, 2017 - April 1, 2017375,858
  14.24
 
  154,144
April 2, 2017 - April 29, 2017
  
 
  154,144
Total1,088,673
  13.87
 695,672
  


(a) Total number of shares purchased includes 314,445393,001 shares of restricted stock repurchased in connection with employee tax withholding obligations under employee compensation plans, which are not purchases under any publicly announced plan.
(b) In November 2015, we announced a $300.0 million share repurchase plan. There was approximately $223.4$154.1 million remaining under the program as of the end of the first quarter. The repurchase program has no specific termination date and will expire when we have repurchased all securities authorized for repurchase thereunder, unless terminated earlier by our Board of Directors.


 

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ITEM 6.EXHIBITS
(a)The following documents are filed as exhibits to this Quarterly Report on Form 10-Q:
 Exhibit 1810.1  Preferability Letter from Independent Registered Certified Public Accounting Firm Regarding Change in Accounting PrincipleIncentive Compensation Clawback Policy, effective April 6, 2017
Exhibit 10.2Amendment No. 2. to 2012 Omnibus Stock and Incentive Plan, effective April 6, 2017
Exhibit 10.3Separation Agreement and Release, between the Company and Laurie Van Brunt dated April 7, 2017 (Filed with the SEC as Exhibit 99.1 to the Company's Form 8-K on April 10, 2017)
    
 Exhibit 31.1  Chico’s FAS, Inc. and Subsidiaries Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Chief Executive Officer
   
 Exhibit 31.2  Chico’s FAS, Inc. and Subsidiaries Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Chief Financial Officer
   
 Exhibit 32.1  Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
   
 Exhibit 32.2  Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
   
 Exhibit 101.INS  XBRL Instance Document
   
 Exhibit 101.SCH  XBRL Taxonomy Extension Schema Document
   
 Exhibit 101.CAL  XBRL Taxonomy Extension Calculation Linkbase Document
   
 Exhibit 101.DEF  XBRL Taxonomy Definition Linkbase Document
   
 Exhibit 101.LAB  XBRL Taxonomy Extension Label Linkbase Document
   
 Exhibit 101.PRE  XBRL Taxonomy Extension Presentation Linkbase Document



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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
      CHICO’S FAS, INC.
     
Date:May 27, 201625, 2017   By:/s/ Shelley G. Broader
      Shelley G. Broader
      Chief Executive Officer, President and Director
     
Date:May 27, 201625, 2017   By:/s/ Todd E. Vogensen
      Todd E. Vogensen
      Executive Vice President, Chief Financial Officer and Assistant Corporate Secretary
       
Date:May 27, 201625, 2017   By:/s/ David M. Oliver
      David M. Oliver
      Group Vice President Finance, - Controller and Chief Accounting Officer and Treasurer

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