Delaware | 46-4841717 | |||||||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||||
2435 Commerce Ave | ||||||||||
Building 2200 | 30096 | |||||||||
Duluth, | Georgia | (Zip Code) | ||||||||
(Address of principal executive offices) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Common stock, par value $0.01 per share | EYE | NASDAQ |
Large accelerated filer | ☒ | Accelerated filer | ☐ | |||||||||||||||||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||||||||||||||||
Emerging growth company | ☐ |
Class | Outstanding at July 31, 2020 | |||||||
Common stock, $0.01 par value | 80,423,493 |
Page | |||||||||||||||||
•the loss of, or disruption in the operations of, one or more of our distribution centers and/or optical laboratories,resulting in the inability to fulfill customer orders and deliver our products in a timely manner; • |
ASSETS | As of March 28, 2020 | As of December 28, 2019 | ASSETS | As of June 27, 2020 | As of December 28, 2019 | |||||||||||||
Current assets: | Current assets: | |||||||||||||||||
Cash and cash equivalents | $ | 263,154 | $ | 39,342 | Cash and cash equivalents | $ | 256,292 | $ | 39,342 | |||||||||
Accounts receivable, net | 27,596 | 44,475 | Accounts receivable, net | 58,451 | 44,475 | |||||||||||||
Inventories | 130,372 | 127,556 | Inventories | 117,859 | 127,556 | |||||||||||||
Prepaid expenses and other current assets | 20,095 | 23,266 | Prepaid expenses and other current assets | 20,520 | 23,266 | |||||||||||||
Total current assets | 441,217 | 234,639 | Total current assets | 453,122 | 234,639 | |||||||||||||
Property and equipment, net | 349,767 | 366,767 | Property and equipment, net | 339,905 | 366,767 | |||||||||||||
Other assets: | Other assets: | |||||||||||||||||
Goodwill | 777,613 | 777,613 | Goodwill | 777,613 | 777,613 | |||||||||||||
Trademarks and trade names | 240,547 | 240,547 | Trademarks and trade names | 240,547 | 240,547 | |||||||||||||
Other intangible assets, net | 55,088 | 56,940 | Other intangible assets, net | 53,236 | 56,940 | |||||||||||||
Right of use assets | 343,731 | 348,090 | Right of use assets | 341,743 | 348,090 | |||||||||||||
Other assets | 10,783 | 8,129 | Other assets | 12,871 | 8,129 | |||||||||||||
Total non-current assets | 1,777,529 | 1,798,086 | Total non-current assets | 1,765,915 | 1,798,086 | |||||||||||||
Total assets | $ | 2,218,746 | $ | 2,032,725 | Total assets | $ | 2,219,037 | $ | 2,032,725 | |||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||||
Current liabilities: | Current liabilities: | |||||||||||||||||
Accounts payable | $ | 59,953 | $ | 40,782 | Accounts payable | $ | 52,432 | $ | 40,782 | |||||||||
Other payables and accrued expenses | 98,972 | 82,829 | Other payables and accrued expenses | 106,865 | 82,829 | |||||||||||||
Unearned revenue | 8,487 | 28,002 | Unearned revenue | 42,365 | 28,002 | |||||||||||||
Deferred revenue | 56,508 | 55,870 | Deferred revenue | 51,624 | 55,870 | |||||||||||||
Current maturities of long-term debt and finance lease obligations | 3,531 | 13,759 | Current maturities of long-term debt and finance lease obligations | 3,293 | 13,759 | |||||||||||||
Current operating lease obligations | 60,014 | 51,937 | Current operating lease obligations | 55,363 | 51,937 | |||||||||||||
Total current liabilities | 287,465 | 273,179 | Total current liabilities | 311,942 | 273,179 | |||||||||||||
Long-term debt and finance lease obligations, less current portion and debt discount | 713,246 | 555,933 | Long-term debt and finance lease obligations, less current portion and debt discount | 644,941 | 555,933 | |||||||||||||
Non-current operating lease obligations | 331,234 | 331,769 | Non-current operating lease obligations | 328,453 | 331,769 | |||||||||||||
Other non-current liabilities: | Other non-current liabilities: | |||||||||||||||||
Deferred revenue | 21,401 | 21,530 | Deferred revenue | 19,438 | 21,530 | |||||||||||||
Other liabilities | 20,526 | 13,731 | Other liabilities | 25,928 | 13,731 | |||||||||||||
Deferred income taxes, net | 58,714 | 60,146 | Deferred income taxes, net | 67,396 | 60,146 | |||||||||||||
Total other non-current liabilities | 100,641 | 95,407 | Total other non-current liabilities | 112,762 | 95,407 | |||||||||||||
Commitments and contingencies (See Note 9) | Commitments and contingencies (See Note 9) | |||||||||||||||||
Stockholders’ equity: | Stockholders’ equity: | |||||||||||||||||
Common stock, $0.01 par value; 200,000 shares authorized; 81,205 and 80,603 shares issued as of March 28, 2020 and December 28, 2019, respectively; 80,278 and 79,678 shares outstanding as of March 28, 2020 and December 28, 2019, respectively | 811 | 805 | ||||||||||||||||
Common stock, $0.01 par value; 200,000 shares authorized; 81,342 and 80,603 shares issued as of June 27, 2020 and December 28, 2019, respectively; 80,415 and 79,678 shares outstanding as of June 27, 2020 and December 28, 2019, respectively | Common stock, $0.01 par value; 200,000 shares authorized; 81,342 and 80,603 shares issued as of June 27, 2020 and December 28, 2019, respectively; 80,415 and 79,678 shares outstanding as of June 27, 2020 and December 28, 2019, respectively | 812 | 805 | |||||||||||||||
Additional paid-in capital | 707,301 | 700,121 | Additional paid-in capital | 782,851 | 700,121 | |||||||||||||
Accumulated other comprehensive loss | (10,416 | ) | (3,814 | ) | Accumulated other comprehensive loss | (7,355) | (3,814) | |||||||||||
Retained earnings | 116,345 | 107,132 | Retained earnings | 72,512 | 107,132 | |||||||||||||
Treasury stock, at cost; 927 and 925 shares as of March 28, 2020 and December 28, 2019, respectively | (27,881 | ) | (27,807 | ) | ||||||||||||||
Treasury stock, at cost; 927 and 925 shares as of June 27, 2020 and December 28, 2019, respectively | Treasury stock, at cost; 927 and 925 shares as of June 27, 2020 and December 28, 2019, respectively | (27,881) | (27,807) | |||||||||||||||
Total stockholders’ equity | 786,160 | 776,437 | Total stockholders’ equity | 820,939 | 776,437 | |||||||||||||
Total liabilities and stockholders’ equity | $ | 2,218,746 | $ | 2,032,725 | Total liabilities and stockholders’ equity | $ | 2,219,037 | $ | 2,032,725 |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||||||||
June 27, 2020 | June 29, 2019 | June 27, 2020 | June 29, 2019 | ||||||||||||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||||||||||||||
Net product sales | $ | 209,707 | $ | 357,533 | $ | 602,548 | $ | 740,693 | |||||||||||||||||||||||||||
Net sales of services and plans | 50,300 | 71,918 | 127,163 | 149,973 | |||||||||||||||||||||||||||||||
Total net revenue | 260,007 | 429,451 | 729,711 | 890,666 | |||||||||||||||||||||||||||||||
Costs applicable to revenue (exclusive of depreciation and amortization): | |||||||||||||||||||||||||||||||||||
Products | 97,635 | 145,654 | 254,005 | 299,658 | |||||||||||||||||||||||||||||||
Services and plans | 43,145 | 56,852 | 105,329 | 114,817 | |||||||||||||||||||||||||||||||
Total costs applicable to revenue | 140,780 | 202,506 | 359,334 | 414,475 | |||||||||||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||||||||||
Selling, general and administrative expenses | 136,582 | 182,278 | 330,323 | 376,154 | |||||||||||||||||||||||||||||||
Depreciation and amortization | 21,924 | 20,819 | 46,734 | 41,234 | |||||||||||||||||||||||||||||||
Asset impairment | 2,411 | 1,790 | 13,766 | 3,872 | |||||||||||||||||||||||||||||||
Litigation settlement | — | — | 4,395 | — | |||||||||||||||||||||||||||||||
Other expense (income), net | (92) | 356 | (158) | 829 | |||||||||||||||||||||||||||||||
Total operating expenses | 160,825 | 205,243 | 395,060 | 422,089 | |||||||||||||||||||||||||||||||
Income (loss) from operations | (41,598) | 21,702 | (24,683) | 54,102 | |||||||||||||||||||||||||||||||
Interest expense, net | 15,502 | 8,968 | 22,957 | 18,029 | |||||||||||||||||||||||||||||||
Debt issuance costs | 136 | — | 136 | — | |||||||||||||||||||||||||||||||
Earnings (loss) before income taxes | (57,236) | 12,734 | (47,776) | 36,073 | |||||||||||||||||||||||||||||||
Income tax provision (benefit) | (13,403) | 2,477 | (13,685) | 8,387 | |||||||||||||||||||||||||||||||
Net income (loss) | $ | (43,833) | $ | 10,257 | $ | (34,091) | $ | 27,686 | |||||||||||||||||||||||||||
Earnings (loss) per share: | |||||||||||||||||||||||||||||||||||
Basic | $ | (0.55) | $ | 0.13 | $ | (0.42) | $ | 0.35 | |||||||||||||||||||||||||||
Diluted | $ | (0.55) | $ | 0.13 | $ | (0.42) | $ | 0.34 | |||||||||||||||||||||||||||
Weighted average shares outstanding: | |||||||||||||||||||||||||||||||||||
Basic | 80,325 | 78,318 | 80,226 | 78,262 | |||||||||||||||||||||||||||||||
Diluted | 80,325 | 81,424 | 80,226 | 81,437 | |||||||||||||||||||||||||||||||
Comprehensive income (loss): | |||||||||||||||||||||||||||||||||||
Net income (loss) | $ | (43,833) | $ | 10,257 | $ | (34,091) | $ | 27,686 | |||||||||||||||||||||||||||
Unrealized gain (loss) on hedge instruments | 4,111 | (2,246) | (4,747) | (3,519) | |||||||||||||||||||||||||||||||
Tax provision (benefit) of unrealized gain (loss) on hedge instruments | 1,050 | (576) | (1,206) | (902) | |||||||||||||||||||||||||||||||
Comprehensive income (loss) | $ | (40,772) | $ | 8,587 | $ | (37,632) | $ | 25,069 |
Three Months Ended | ||||||||
March 28, 2020 | March 30, 2019 | |||||||
Revenue: | ||||||||
Net product sales | $ | 392,841 | $ | 383,160 | ||||
Net sales of services and plans | 76,863 | 78,055 | ||||||
Total net revenue | 469,704 | 461,215 | ||||||
Costs applicable to revenue (exclusive of depreciation and amortization): | ||||||||
Products | 156,370 | 154,004 | ||||||
Services and plans | 62,184 | 57,965 | ||||||
Total costs applicable to revenue | 218,554 | 211,969 | ||||||
Operating expenses: | ||||||||
Selling, general and administrative expenses | 193,741 | 193,876 | ||||||
Depreciation and amortization | 24,810 | 20,415 | ||||||
Asset impairment | 11,355 | 2,082 | ||||||
Litigation settlement | 4,395 | — | ||||||
Other expense (income), net | (66 | ) | 473 | |||||
Total operating expenses | 234,235 | 216,846 | ||||||
Income from operations | 16,915 | 32,400 | ||||||
Interest expense, net | 7,455 | 9,061 | ||||||
Earnings before income taxes | 9,460 | 23,339 | ||||||
Income tax provision (benefit) | (282 | ) | 5,910 | |||||
Net income | $ | 9,742 | $ | 17,429 | ||||
Earnings per share: | ||||||||
Basic | $ | 0.12 | $ | 0.22 | ||||
Diluted | $ | 0.12 | $ | 0.21 | ||||
Weighted average shares outstanding: | ||||||||
Basic | 80,129 | 78,205 | ||||||
Diluted | 82,242 | 81,466 | ||||||
Comprehensive income: | ||||||||
Net income | $ | 9,742 | $ | 17,429 | ||||
Unrealized gain (loss) on hedge instruments | (8,858 | ) | (1,273 | ) | ||||
Tax provision (benefit) of unrealized gain (loss) on hedge instruments | (2,256 | ) | (326 | ) | ||||
Comprehensive income | $ | 3,140 | $ | 16,482 |
Three Months Ended March 28, 2020 | Three and Six Months Ended June 27, 2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock | Total Stockholders' Equity | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock | Total Stockholders' Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances at December 28, 2019 | 79,678 | $ | 805 | $ | 700,121 | $ | (3,814 | ) | $ | 107,132 | $ | (27,807 | ) | $ | 776,437 | Balances at December 28, 2019 | 79,678 | $ | 805 | $ | 700,121 | $ | (3,814) | $ | 107,132 | $ | (27,807) | $ | 776,437 | ||||||||||||||||||||||||||||||||
Cumulative effect of change in accounting principle | — | — | — | — | (529 | ) | — | (529 | ) | Cumulative effect of change in accounting principle | — | — | — | — | (529) | — | (529) | ||||||||||||||||||||||||||||||||||||||||||||
Balances at December 28, 2019 - as adjusted | 79,678 | 805 | 700,121 | (3,814 | ) | 106,603 | (27,807 | ) | 775,908 | Balances at December 28, 2019 - as adjusted | 79,678 | 805 | 700,121 | (3,814) | 106,603 | (27,807) | 775,908 | ||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock | 602 | 6 | 5,114 | — | — | — | 5,120 | Issuance of common stock | 602 | 6 | 5,114 | — | — | — | 5,120 | ||||||||||||||||||||||||||||||||||||||||||||||
Stock based compensation | — | — | 2,066 | — | — | — | 2,066 | Stock based compensation | — | — | 2,066 | — | — | — | 2,066 | ||||||||||||||||||||||||||||||||||||||||||||||
Purchase of treasury stock | (2 | ) | — | — | — | — | (74 | ) | (74 | ) | Purchase of treasury stock | (2) | — | — | — | — | (74) | (74) | |||||||||||||||||||||||||||||||||||||||||||
Unrealized gain (loss) on hedge instruments, net of tax | — | — | — | (6,602 | ) | — | — | (6,602 | ) | Unrealized gain (loss) on hedge instruments, net of tax | — | — | — | (6,602) | — | — | (6,602) | ||||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | 9,742 | — | 9,742 | Net income | — | — | — | — | 9,742 | — | 9,742 | ||||||||||||||||||||||||||||||||||||||||||||||
Balances at March 28, 2020 | 80,278 | $ | 811 | $ | 707,301 | $ | (10,416 | ) | $ | 116,345 | $ | (27,881 | ) | $ | 786,160 | Balances at March 28, 2020 | 80,278 | $ | 811 | $ | 707,301 | $ | (10,416) | $ | 116,345 | $ | (27,881) | $ | 786,160 | ||||||||||||||||||||||||||||||||
Issuance of common stock | Issuance of common stock | 137 | 1 | 877 | — | — | — | 878 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock based compensation | Stock based compensation | — | — | 3,324 | — | — | — | 3,324 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Conversion option related to convertible senior notes, net of allocated costs and tax | Conversion option related to convertible senior notes, net of allocated costs and tax | — | — | 71,349 | — | — | — | 71,349 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Unrealized gain (loss) on hedge instruments, net of tax | Unrealized gain (loss) on hedge instruments, net of tax | — | — | — | 3,061 | — | — | 3,061 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | Net income (loss) | — | — | — | — | (43,833) | — | (43,833) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances at June 27, 2020 | Balances at June 27, 2020 | 80,415 | $ | 812 | $ | 782,851 | $ | (7,355) | $ | 72,512 | $ | (27,881) | $ | 820,939 |
Three Months Ended March 30, 2019 | Three and Six Months Ended June 29, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock | Total Stockholders' Equity | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock | Total Stockholders' Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances at December 29, 2018 | 78,167 | $ | 782 | $ | 672,503 | $ | (2,810 | ) | $ | 74,840 | $ | (2,161 | ) | $ | 743,154 | Balances at December 29, 2018 | 78,167 | $ | 782 | $ | 672,503 | $ | (2,810) | $ | 74,840 | $ | (2,161) | $ | 743,154 | ||||||||||||||||||||||||||||||||
Cumulative effect of change in accounting principle | — | — | — | — | (506 | ) | — | (506 | ) | Cumulative effect of change in accounting principle | — | — | — | — | (506) | — | (506) | ||||||||||||||||||||||||||||||||||||||||||||
Balances at December 30, 2018 - as adjusted | 78,167 | 782 | 672,503 | (2,810 | ) | 74,334 | (2,161 | ) | 742,648 | Balances at December 30, 2018 - as adjusted | 78,167 | 782 | 672,503 | (2,810) | 74,334 | (2,161) | 742,648 | ||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock | 51 | 1 | 512 | — | — | — | 513 | Issuance of common stock | 51 | 1 | 512 | — | — | — | 513 | ||||||||||||||||||||||||||||||||||||||||||||||
Stock based compensation | — | — | 2,937 | — | — | — | 2,937 | Stock based compensation | — | — | 2,937 | — | — | — | 2,937 | ||||||||||||||||||||||||||||||||||||||||||||||
Unrealized gain (loss) on hedge instruments, net of tax | — | — | — | (947 | ) | — | — | (947 | ) | Unrealized gain (loss) on hedge instruments, net of tax | — | — | — | (947) | — | — | (947) | ||||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | 17,429 | — | 17,429 | Net income | — | �� | — | — | — | 17,429 | — | 17,429 | |||||||||||||||||||||||||||||||||||||||||||||
Balances at March 30, 2019 | 78,218 | $ | 783 | $ | 675,952 | $ | (3,757 | ) | $ | 91,763 | $ | (2,161 | ) | $ | 762,580 | Balances at March 30, 2019 | 78,218 | $ | 783 | $ | 675,952 | $ | (3,757) | $ | 91,763 | $ | (2,161) | $ | 762,580 | ||||||||||||||||||||||||||||||||
Issuance of common stock | Issuance of common stock | 266 | 3 | 1,550 | — | — | — | 1,553 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock based compensation | Stock based compensation | — | — | 1,714 | — | — | — | 1,714 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Unrealized gain (loss) on hedge instruments, net of tax | Unrealized gain (loss) on hedge instruments, net of tax | — | — | — | (1,670) | — | — | (1,670) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income | Net income | — | — | — | — | 10,257 | — | 10,257 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances at June 29, 2019 | Balances at June 29, 2019 | 78,484 | $ | 786 | $ | 679,216 | $ | (5,427) | $ | 102,020 | $ | (2,161) | $ | 774,434 |
Three Months Ended | Six Months Ended | |||||||||||||||||||||||
March 28, 2020 | March 30, 2019 | June 27, 2020 | June 29, 2019 | |||||||||||||||||||||
Cash flows from operating activities: | Cash flows from operating activities: | |||||||||||||||||||||||
Net income | $ | 9,742 | $ | 17,429 | ||||||||||||||||||||
Net income (loss) | Net income (loss) | $ | (34,091) | $ | 27,686 | |||||||||||||||||||
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 amortization | 24,810 | 20,415 | Depreciation and amortization | 46,734 | 41,234 | |||||||||||||||||||
Amortization of loan costs | 217 | 406 | ||||||||||||||||||||||
Amortization of debt discount and deferred financing costs | Amortization of debt discount and deferred financing costs | 2,717 | 892 | |||||||||||||||||||||
Asset impairment | 11,355 | 2,082 | Asset impairment | 13,766 | 3,872 | |||||||||||||||||||
Deferred income tax expense (benefit) | (282 | ) | 5,910 | Deferred income tax expense (benefit) | (13,686) | 8,239 | ||||||||||||||||||
Stock based compensation expense | 2,093 | 2,976 | Stock based compensation expense | 5,445 | 4,717 | |||||||||||||||||||
Losses (gains) on change in fair value of derivatives | Losses (gains) on change in fair value of derivatives | 4,871 | — | |||||||||||||||||||||
Inventory adjustments | 1,695 | 1,319 | Inventory adjustments | 2,883 | 2,043 | |||||||||||||||||||
Credit loss expense | 448 | 2,021 | Credit loss expense | 432 | 3,865 | |||||||||||||||||||
Other | 1,014 | 1,041 | Other | 1,373 | 1,592 | |||||||||||||||||||
Changes in operating assets and liabilities: | Changes in operating assets and liabilities: | |||||||||||||||||||||||
Accounts receivable | 16,431 | (9,307 | ) | Accounts receivable | (14,408) | (10,567) | ||||||||||||||||||
Inventories | (4,511 | ) | 2,767 | Inventories | 6,814 | 8,319 | ||||||||||||||||||
Other assets | 4,372 | 5,791 | Other assets | 3,444 | 11,391 | |||||||||||||||||||
Accounts payable | 19,171 | 1,445 | Accounts payable | 11,630 | 3,458 | |||||||||||||||||||
Deferred revenue | 509 | 4,684 | Deferred revenue | (6,338) | 5,804 | |||||||||||||||||||
Other liabilities | (1,004 | ) | 24,035 | Other liabilities | 39,834 | 6,734 | ||||||||||||||||||
Net cash provided by operating activities | 86,060 | 83,014 | Net cash provided by operating activities | 71,420 | 119,279 | |||||||||||||||||||
Cash flows from investing activities: | Cash flows from investing activities: | |||||||||||||||||||||||
Purchase of property and equipment | (13,053 | ) | (25,992 | ) | Purchase of property and equipment | (25,796) | (52,103) | |||||||||||||||||
Other | 199 | 186 | Other | 265 | 315 | |||||||||||||||||||
Net cash used for investing activities | (12,854 | ) | (25,806 | ) | Net cash used for investing activities | (25,531) | (51,788) | |||||||||||||||||
Cash flows from financing activities: | Cash flows from financing activities: | |||||||||||||||||||||||
Proceeds from issuance of long-term debt, net of discounts | 146,269 | — | ||||||||||||||||||||||
Borrowings on long-term debt, net of discounts | Borrowings on long-term debt, net of discounts | 548,769 | — | |||||||||||||||||||||
Repayments on long-term debt | Repayments on long-term debt | (369,269) | (2,500) | |||||||||||||||||||||
Proceeds from exercise of stock options | 5,120 | 513 | Proceeds from exercise of stock options | 5,998 | 2,066 | |||||||||||||||||||
Principal payments on long-term debt | — | (1,250 | ) | |||||||||||||||||||||
Purchase of treasury stock | (74 | ) | — | Purchase of treasury stock | (74) | — | ||||||||||||||||||
Payments of debt issuance costs | Payments of debt issuance costs | (12,400) | — | |||||||||||||||||||||
Payments on finance lease obligations | (714 | ) | (617 | ) | Payments on finance lease obligations | (1,587) | (1,190) | |||||||||||||||||
Net cash provided by (used for) financing activities | 150,601 | (1,354 | ) | Net cash provided by (used for) financing activities | 171,437 | (1,624) | ||||||||||||||||||
Net change in cash, cash equivalents and restricted cash | 223,807 | 55,854 | Net change in cash, cash equivalents and restricted cash | 217,326 | 65,867 | |||||||||||||||||||
Cash, cash equivalents and restricted cash, beginning of year | 40,307 | 17,998 | Cash, cash equivalents and restricted cash, beginning of year | 40,307 | 17,998 | |||||||||||||||||||
Cash, cash equivalents and restricted cash, end of period | $ | 264,114 | $ | 73,852 | Cash, cash equivalents and restricted cash, end of period | $ | 257,633 | $ | 83,865 | |||||||||||||||
Supplemental cash flow disclosure information: | Supplemental cash flow disclosure information: | |||||||||||||||||||||||
Cash paid for interest | $ | 7,065 | $ | 9,857 | Cash paid for interest | $ | 13,810 | $ | 17,438 | |||||||||||||||
Capital expenditures accrued at the end of the period | $ | 12,176 | $ | 13,980 | Capital expenditures accrued at the end of the period | $ | 11,265 | $ | 22,033 | |||||||||||||||
Right of use assets acquired under finance leases | $ | 1,244 | $ | 7,270 | Right of use assets acquired under finance leases | $ | 1,257 | $ | 9,763 | |||||||||||||||
Right of use assets acquired under operating leases | $ | 17,658 | $ | 32,981 | Right of use assets acquired under operating leases | $ | 35,870 | $ | 58,528 |
In thousands | As of June 27, 2020 | As of December 28, 2019 | ||||||||||||||||||
Accounts receivable, net: | ||||||||||||||||||||
Trade receivables | $ | 24,207 | $ | 28,635 | ||||||||||||||||
Credit card receivables | 19,080 | 14,173 | ||||||||||||||||||
Other receivables (1) | 15,817 | 4,707 | ||||||||||||||||||
Allowance for credit losses | (653) | (3,040) | ||||||||||||||||||
$ | 58,451 | $ | 44,475 | |||||||||||||||||
(1) Includes CARES Act receivable in the amount of $10.8 million as of June 27, 2020. |
In thousands | As of June 27, 2020 | As of December 28, 2019 | ||||||||||||||||||
Inventories: | ||||||||||||||||||||
Raw materials and work in process (1) | $ | 61,747 | $ | 65,179 | ||||||||||||||||
Finished goods | 56,112 | 62,377 | ||||||||||||||||||
$ | 117,859 | $ | 127,556 | |||||||||||||||||
(1)Due to the immaterial amount of estimated work in process and the short lead times for the conversion of raw materials to finished goods, the Company does not separately present raw materials and work in process. |
In thousands | As of June 27, 2020 | As of December 28, 2019 | |||||||||
Property and equipment, net: | |||||||||||
Land and building | $ | 3,624 | $ | 3,632 | |||||||
Equipment | 193,875 | 188,593 | |||||||||
Information technology hardware and software | 117,777 | 115,283 | |||||||||
Furniture and fixtures | 54,963 | 55,146 | |||||||||
Leasehold improvements | 215,701 | 213,124 | |||||||||
Construction in progress | 19,792 | 26,517 | |||||||||
Right of use assets under finance leases | 37,162 | 36,437 | |||||||||
642,894 | 638,732 | ||||||||||
Less: Accumulated depreciation | 302,989 | 271,965 | |||||||||
$ | 339,905 | $ | 366,767 |
In thousands | As of June 27, 2020 | As of December 28, 2019 | |||||||||
Other payables and accrued expenses: | |||||||||||
Employee compensation and benefits | $ | 31,157 | $ | 28,347 | |||||||
Advertising | 535 | 2,919 | |||||||||
Self-insurance liabilities | 9,266 | 8,403 | |||||||||
Reserves for customer returns and remakes | 7,457 | 7,158 | |||||||||
Capital expenditures | 11,265 | 6,782 | |||||||||
Legacy management & services agreement | 4,576 | 4,461 | |||||||||
Fair value of derivative liabilities | 7,228 | 6,382 | |||||||||
Supplies and other store support expenses | 6,894 | 2,926 | |||||||||
Litigation settlements | 8,228 | 3,840 | |||||||||
Other | 20,259 | 11,611 | |||||||||
$ | 106,865 | $ | 82,829 | ||||||||
In thousands | As of March 28, 2020 | As of December 28, 2019 | |||||
Accounts receivable, net: | |||||||
Trade receivables | $ | 22,763 | $ | 28,635 | |||
Credit card receivables | 2,441 | 14,173 | |||||
Other receivables | 3,344 | 4,707 | |||||
Allowance for credit losses | (952 | ) | (3,040 | ) | |||
$ | 27,596 | $ | 44,475 |
In thousands | As of March 28, 2020 | As of December 28, 2019 | |||||
Inventories: | |||||||
Raw materials and work in process (1) | $ | 69,706 | $ | 65,179 | |||
Finished goods | 60,666 | 62,377 | |||||
$ | 130,372 | $ | 127,556 | ||||
(1) Due to the immaterial amount of estimated work in process and the short lead times for the conversion of raw materials to finished goods, the Company does not separately present raw materials and work in process. |
In thousands | As of June 27, 2020 | As of December 28, 2019 | ||||||||||||||||||
Other non-current liabilities: | ||||||||||||||||||||
Fair value of derivative liabilities | $ | 10,374 | $ | 1,603 | ||||||||||||||||
Self-insurance liabilities | 8,048 | 7,283 | ||||||||||||||||||
Other (1) | 7,506 | 4,845 | ||||||||||||||||||
$ | 25,928 | $ | 13,731 | |||||||||||||||||
(1) Includes CARES Act deferred employer payroll taxes in the amount of $4.9 million as of June 27, 2020. | ||||||||||||||||||||
In thousands | As of March 28, 2020 | As of December 28, 2019 | |||||
Property and equipment, net: | |||||||
Land and building | $ | 3,624 | $ | 3,632 | |||
Equipment | 188,239 | 188,593 | |||||
Information technology hardware and software | 116,569 | 115,283 | |||||
Furniture and fixtures | 54,446 | 55,146 | |||||
Leasehold improvements | 212,431 | 213,124 | |||||
Construction in progress | 22,548 | 26,517 | |||||
Right of use assets under finance leases | 36,073 | 36,437 | |||||
633,930 | 638,732 | ||||||
Less: Accumulated depreciation | 284,163 | 271,965 | |||||
$ | 349,767 | $ | 366,767 |
In thousands | As of March 28, 2020 | As of December 28, 2019 | |||||
Other payables and accrued expenses: | |||||||
Employee compensation and benefits | $ | 30,680 | $ | 28,347 | |||
Advertising | 2,746 | 2,919 | |||||
Self-insurance liabilities | 8,313 | 8,403 | |||||
Reserves for customer returns and remakes | 7,004 | 7,158 | |||||
Capital expenditures | 10,062 | 6,782 | |||||
Legacy management & services agreement | 3,932 | 4,461 | |||||
Fair value of derivative liabilities | 8,230 | 6,382 | |||||
Supplies and other store support expenses | 3,479 | 2,926 | |||||
Litigation settlements | 8,228 | 3,840 | |||||
Other | 16,298 | 11,611 | |||||
$ | 98,972 | $ | 82,829 |
In thousands | As of March 28, 2020 | As of December 28, 2019 | |||||
Other non-current liabilities: | |||||||
Fair value of derivative liabilities | $ | 8,613 | $ | 1,603 | |||
Self-insurance liabilities | 7,351 | 7,283 | |||||
Other | 4,562 | 4,845 | |||||
$ | 20,526 | $ | 13,731 |
In thousands | Balance Sheet Classification | As of June 27, 2020 | As of December 28, 2019 | |||||||||||||||||||||||
Derivatives designated as hedging instruments under ASC 815 | ||||||||||||||||||||||||||
Interest rate swaps | Other Payables and Accrued Expenses | $ | 5,497 | $ | 6,382 | |||||||||||||||||||||
Interest rate swaps | Other Liabilities | — | 1,603 | |||||||||||||||||||||||
Total derivative liabilities designated as hedging instruments | $ | 5,497 | $ | 7,985 | ||||||||||||||||||||||
Derivatives not designated as hedging instruments under ASC 815 | ||||||||||||||||||||||||||
Interest rate swap | Other Payables and Accrued Expenses | $ | 892 | $ | — | |||||||||||||||||||||
Interest rate collar | Other Payables and Accrued Expenses | 839 | — | |||||||||||||||||||||||
Interest rate collar | Other Liabilities | 10,374 | — | |||||||||||||||||||||||
Total derivative liabilities not designated as hedging instruments | $ | 12,106 | $ | — |
In thousands | Notional Amount | Other Payables and Accrued Expenses | Other Liabilities | AOCL, Net of Tax (1) | |||||||||||
As of March 28, 2020 | $ | 395,000 | $ | 8,230 | $ | 8,613 | $ | 10,416 | |||||||
As of December 28, 2019 | $ | 430,000 | $ | 6,382 | $ | 1,603 | $ | 3,814 |
In thousands | As of June 27, 2020 | As of December 28, 2019 | |||||||||
2025 Notes, due May 15, 2025 | $ | 402,500 | $ | — | |||||||
Term loan, due July 18, 2024 | 317,375 | 392,375 | |||||||||
Revolving credit facility, due July 18, 2024 | — | 148,000 | |||||||||
Long-term debt before debt discount | 719,875 | 540,375 | |||||||||
Unamortized discount and issuance costs - 2025 Notes | (101,780) | — | |||||||||
Unamortized discount and issuance costs - term loan | (2,454) | (3,979) | |||||||||
Long-term debt less debt discount | 615,641 | 536,396 | |||||||||
Less current maturities | — | (10,500) | |||||||||
Long-term debt - non-current portion | 615,641 | 525,896 | |||||||||
Finance lease obligations | 32,593 | 33,296 | |||||||||
Less current maturities | (3,293) | (3,259) | |||||||||
Long-term debt and finance lease obligations, less current portion and debt discount | $ | 644,941 | $ | 555,933 |
In thousands | As of March 28, 2020 | As of December 28, 2019 | |||||
Term loan, due July 18, 2024 | 392,375 | 392,375 | |||||
Revolving credit facility, due July 18, 2024 | 294,269 | 148,000 | |||||
Term loan and revolving credit facility before unamortized discount | 686,644 | 540,375 | |||||
Unamortized discount | (3,762 | ) | (3,979 | ) | |||
Total term loan and revolving credit facility | 682,882 | 536,396 | |||||
Less current maturities | — | (10,500 | ) | ||||
Term loan and revolving credit facility - non-current portion | 682,882 | 525,896 | |||||
Finance lease obligations | 33,895 | 33,296 | |||||
Less current maturities | (3,531 | ) | (3,259 | ) | |||
Long-term debt, less current portion and unamortized debt discount | $ | 713,246 | $ | 555,933 |
Fiscal Period | In thousands | |||
2020 - remaining fiscal year | $ | — | ||
2021 | — | |||
2022 | 9,125 | |||
2023 | 21,000 | |||
2024 | 656,519 | |||
$ | 686,644 |
Fiscal Period | In thousands | |||||||
2020 - remaining fiscal year | $ | — | ||||||
2021 | — | |||||||
2022 | — | |||||||
2023 | — | |||||||
2024 | 317,375 | |||||||
Thereafter | 402,500 | |||||||
$ | 719,875 |
Three Months Ended | |||||||
In thousands | March 28, 2020 | March 30, 2019 | |||||
Revenues recognized at a point in time | $ | 434,179 | $ | 424,214 | |||
Revenues recognized over time | 35,525 | 37,001 | |||||
Total net revenue | $ | 469,704 | $ | 461,215 |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||||||||
In thousands | June 27, 2020 | June 29, 2019 | June 27, 2020 | June 29, 2019 | |||||||||||||||||||||||||||||||
Revenues recognized at a point in time | $ | 229,536 | $ | 393,020 | $ | 663,715 | $ | 817,233 | |||||||||||||||||||||||||||
Revenues recognized over time | 30,471 | 36,431 | 65,996 | 73,433 | |||||||||||||||||||||||||||||||
Total net revenue | $ | 260,007 | $ | 429,451 | $ | 729,711 | $ | 890,666 |
In thousands | June 27, 2020 | |||||||
Beginning balance as of December 28, 2019 | ||||||||
Current-period provision for expected credit losses | ||||||||
Write-offs charged against the allowance | ||||||||
Other adjustments (1) | 2,207 | |||||||
Ending balance as of | ||||||||
(1) As part of our adoption of ASU 2016-13 we adjusted the allowance for certain amounts recognized in prior periods that no longer represented an allowance for credit losses. The adjustment was immaterial to the financial results of current and prior periods. See Note 2. “Details of Certain Balance Sheet Accounts” for further details. |
In thousands | As of March 28, 2020 | As of December 28, 2019 | |||||||
Type | Classification | ||||||||
ASSETS | |||||||||
Finance | Property and equipment, net (a) | $ | 26,716 | $ | 28,128 | ||||
Operating | Right of use assets (b) | 343,731 | 348,090 | ||||||
Total leased assets | 370,447 | 376,218 | |||||||
LIABILITIES | |||||||||
Current Liabilities: | |||||||||
Finance | Current maturities of long-term debt and finance lease obligations | $ | 3,531 | $ | 3,259 | ||||
Operating | Current operating lease obligations (c) | 60,014 | 51,937 | ||||||
Other non-current liabilities: | |||||||||
Finance | Long-term debt and finance lease obligations, less current portion and debt discount | 30,364 | 30,037 | ||||||
Operating | Non-current operating lease obligations | 331,234 | 331,769 | ||||||
Total lease liabilities | $ | 425,143 | $ | 417,002 | |||||
As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the net present value of minimum lease payments. We used the incremental borrowing rate on December 30, 2018, for operating leases that commenced prior to that date. |
In thousands | As of June 27, 2020 | As of December 28, 2019 | ||||||||||||||||||||||||||||||
Type | Classification | |||||||||||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||||||||||||
Finance | Property and equipment, net (a) | $ | 26,680 | $ | 28,128 | |||||||||||||||||||||||||||
Operating | Right of use assets (b) | 341,743 | 348,090 | |||||||||||||||||||||||||||||
Total leased assets | 368,423 | 376,218 | ||||||||||||||||||||||||||||||
LIABILITIES | ||||||||||||||||||||||||||||||||
Current Liabilities: | ||||||||||||||||||||||||||||||||
Finance | Current maturities of long-term debt and finance lease obligations | $ | 3,293 | $ | 3,259 | |||||||||||||||||||||||||||
Operating | Current operating lease obligations (c) | 55,363 | 51,937 | |||||||||||||||||||||||||||||
Other non-current liabilities: | ||||||||||||||||||||||||||||||||
Finance | Long-term debt and finance lease obligations, less current portion and debt discount | 29,300 | 30,037 | |||||||||||||||||||||||||||||
Operating | Non-current operating lease obligations | 328,453 | 331,769 | |||||||||||||||||||||||||||||
Total lease liabilities | $ | 416,409 | $ | 417,002 | ||||||||||||||||||||||||||||
As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the net present value of minimum lease payments. We used the incremental borrowing rate on December 30, 2018, for operating leases that commenced prior to that date. |
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||||||||||||||||||
In thousands | June 27, 2020 | June 29, 2019 | June 27, 2020 | June 29, 2019 | ||||||||||||||||||||||||||||||||||||||||
Operating lease cost | ||||||||||||||||||||||||||||||||||||||||||||
Fixed lease cost (a) | $ | 19,100 | $ | 18,250 | $ | 38,412 | $ | 36,413 | ||||||||||||||||||||||||||||||||||||
Variable lease cost (b) | 6,356 | 6,592 | 13,166 | 13,058 | ||||||||||||||||||||||||||||||||||||||||
Sublease income(c) | (292) | (954) | (882) | (1,916) | ||||||||||||||||||||||||||||||||||||||||
Finance lease cost | ||||||||||||||||||||||||||||||||||||||||||||
Amortization of finance lease assets | 1,125 | 1,078 | 2,281 | 2,056 | ||||||||||||||||||||||||||||||||||||||||
Interest expense, net: | ||||||||||||||||||||||||||||||||||||||||||||
Interest on finance lease liabilities | 851 | 896 | 1,724 | 1,786 | ||||||||||||||||||||||||||||||||||||||||
Net lease cost | $ | 27,140 | $ | 25,862 | $ | 54,701 | $ | 51,397 | ||||||||||||||||||||||||||||||||||||
(a) Includes short-term leases, which are immaterial. | ||||||||||||||||||||||||||||||||||||||||||||
(b) Includes costs for insurance, real estate taxes and common area maintenance expenses, which are variable, as are lease costs above minimum thresholds for Fred Meyer stores and lease costs for Military stores. | ||||||||||||||||||||||||||||||||||||||||||||
(c) Income from sub-leasing of stores includes rental income from operating lease properties to ophthalmologists and optometrists who are independent contractors. |
In thousands | As of March 28, 2020 | As of March 30, 2019 | ||||||
Operating lease cost | ||||||||
Fixed lease cost (a) | $ | 19,312 | $ | 18,163 | ||||
Variable lease cost (b) | 6,810 | 6,466 | ||||||
Sublease income(c) | (591 | ) | (962 | ) | ||||
Finance lease cost | ||||||||
Amortization of finance lease assets | 1,156 | 978 | ||||||
Interest expense, net: | ||||||||
Interest on finance lease liabilities | 872 | 890 | ||||||
Net lease cost | $ | 27,559 | $ | 25,535 | ||||
(a) Includes short-term leases, which are immaterial. | ||||||||
(b) Includes costs for insurance, real estate taxes and common area maintenance expenses, which are variable as well as lease costs above minimum thresholds for Fred Meyer stores and lease costs for Military stores. | ||||||||
(c) Income from sub-leasing of stores includes rental income from operating lease properties to ophthalmologists and optometrists who are independent contractors. |
Lease Term and Discount Rate | As of March 28, 2020 | As of December 28, 2019 | ||||
Weighted average remaining lease term (months) | ||||||
Operating leases | 81 | 82 | ||||
Finance leases | 87 | 88 | ||||
Weighted average discount rate (a) | ||||||
Operating leases | 4.6 | % | 4.6 | % | ||
Finance leases (b) | 12.7 | % | 13.1 | % | ||
(a) The discount rate used to determine the lease assets and lease liabilities was derived upon considering (i) incremental borrowing rates on our long-term debt; (ii) fixed rates we pay on our interest rate swaps; (iii) LIBOR margins for issuers of similar credit rating; and (iv) effect of collateralization. As a majority of our leases are five-year and 10-year leases, we determined a lease discount rate for such tenors and determined this discount rate is reasonable for leases that were entered into during the period. | ||||||
(b) The discount rate on finance leases is higher than operating leases because the present value of minimum lease payments was higher than the fair value of leased properties for certain leases entered into prior to adoption of ASC 842. The discount rate differential for those leases is not material to our results of operations. |
In thousands | As of March 28, 2020 | As of March 30, 2019 | ||||||
Other Information | ||||||||
Cash paid for amounts included in the measurement of lease liabilities | ||||||||
Operating cash outflows - operating leases | $ | 15,269 | $ | 18,146 |
Lease Term and Discount Rate | As of June 27, 2020 | As of December 28, 2019 | |||||||||||||||||||||||||||||||||
Weighted average remaining lease term (months) | |||||||||||||||||||||||||||||||||||
Operating leases | 80 | 82 | |||||||||||||||||||||||||||||||||
Finance leases | 85 | 88 | |||||||||||||||||||||||||||||||||
Weighted average discount rate (a) | |||||||||||||||||||||||||||||||||||
Operating leases | 4.6 | % | 4.6 | % | |||||||||||||||||||||||||||||||
Finance leases (b) | 12.6 | % | 13.1 | % | |||||||||||||||||||||||||||||||
(a) The discount rate used to determine the lease assets and lease liabilities was derived upon considering (i) incremental borrowing rates on our term loan and revolving credit facility; (ii) fixed rates we pay on our interest rate swaps; (iii) LIBOR margins for issuers of similar credit rating; and (iv) effect of collateralization. As a majority of our leases are five-year and 10-year leases, we determined a lease discount rate for such tenors and determined this discount rate is reasonable for leases that were entered into during the period. | |||||||||||||||||||||||||||||||||||
(b) The discount rate on finance leases is higher than operating leases because the present value of minimum lease payments was higher than the fair value of leased properties for certain leases entered into prior to adoption of ASC 842. The discount rate differential for those leases is not material to our results of operations. |
In thousands | As of June 27, 2020 | As of June 29, 2019 | |||||||||||||||||||||
Other Information | |||||||||||||||||||||||
Cash paid for amounts included in the measurement of lease liabilities | |||||||||||||||||||||||
Operating cash outflows - operating leases | $ | 35,548 | $ | 36,866 |
In thousands | Operating Leases (a) | Finance Leases (b) | In thousands | Operating Leases (a) | Finance Leases (b) | |||||||||||||||||||||||||||||
Fiscal Year | Fiscal Year | |||||||||||||||||||||||||||||||||
2020 | $ | 56,224 | $ | 5,319 | 2020 | $ | 31,312 | $ | 3,166 | |||||||||||||||||||||||||
2021 | 77,307 | 7,280 | 2021 | 79,662 | 7,280 | |||||||||||||||||||||||||||||
2022 | 69,631 | 7,215 | 2022 | 72,081 | 7,215 | |||||||||||||||||||||||||||||
2023 | 62,360 | 6,241 | 2023 | 64,351 | 6,241 | |||||||||||||||||||||||||||||
2024 | 55,206 | 4,673 | 2024 | 56,598 | 4,673 | |||||||||||||||||||||||||||||
Thereafter | 138,152 | 16,460 | Thereafter | 146,931 | 16,460 | |||||||||||||||||||||||||||||
Total lease liabilities | 458,880 | 47,188 | Total lease liabilities | 450,935 | 45,035 | |||||||||||||||||||||||||||||
Less: Interest | 67,632 | 13,293 | Less: Interest | 67,119 | 12,442 | |||||||||||||||||||||||||||||
Present value of lease liabilities(c) | $ | 391,248 | $ | 33,895 | Present value of lease liabilities(c) | $ | 383,816 | $ | 32,593 | |||||||||||||||||||||||||
(a) Operating lease payments include $69.8 million related to options to extend lease terms that are reasonably certain of being exercised. | ||||||||||||||||||||||||||||||||||
(a) Operating lease payments include $64.3 million related to options to extend lease terms that are reasonably certain of being exercised. | (a) Operating lease payments include $64.3 million related to options to extend lease terms that are reasonably certain of being exercised. | |||||||||||||||||||||||||||||||||
(b) Finance lease payments include $1.7 million related to options to extend lease terms that are reasonably certain of being exercised. | (b) Finance lease payments include $1.7 million related to options to extend lease terms that are reasonably certain of being exercised. | (b) Finance lease payments include $1.7 million related to options to extend lease terms that are reasonably certain of being exercised. | ||||||||||||||||||||||||||||||||
(c) The present value of lease liabilities excludes $21.0 million of legally binding minimum lease payments for leases signed but not yet commenced. | ||||||||||||||||||||||||||||||||||
(c) The present value of lease liabilities excludes $13.3 million of legally binding minimum lease payments for leases signed but not yet commenced. | (c) The present value of lease liabilities excludes $13.3 million of legally binding minimum lease payments for leases signed but not yet commenced. |
Three Months Ended June 27, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
In thousands | Owned & Host | Legacy | Corporate/Other | Reconciliations | Total | ||||||||||||||||||||||||||||||||||||||||||||||||
Segment product revenues | $ | 177,430 | $ | 16,254 | $ | 50,472 | $ | (34,449) | $ | 209,707 | |||||||||||||||||||||||||||||||||||||||||||
Segment services and plans revenues | 34,275 | 9,159 | — | 6,866 | 50,300 | ||||||||||||||||||||||||||||||||||||||||||||||||
Total net revenue | 211,705 | 25,413 | 50,472 | (27,583) | 260,007 | ||||||||||||||||||||||||||||||||||||||||||||||||
Cost of products | 54,898 | 9,093 | 42,135 | (8,491) | 97,635 | ||||||||||||||||||||||||||||||||||||||||||||||||
Cost of services and plans | 38,573 | 4,572 | — | — | 43,145 | ||||||||||||||||||||||||||||||||||||||||||||||||
Total costs applicable to revenue | 93,471 | 13,665 | 42,135 | (8,491) | 140,780 | ||||||||||||||||||||||||||||||||||||||||||||||||
SG&A | 86,704 | 10,561 | 39,317 | — | 136,582 | ||||||||||||||||||||||||||||||||||||||||||||||||
Asset impairment | — | — | 2,411 | — | 2,411 | ||||||||||||||||||||||||||||||||||||||||||||||||
Debt issuance costs | — | — | 136 | — | 136 | ||||||||||||||||||||||||||||||||||||||||||||||||
Other expense (income), net | — | — | (92) | — | (92) | ||||||||||||||||||||||||||||||||||||||||||||||||
EBITDA | $ | 31,530 | $ | 1,187 | $ | (33,435) | $ | (19,092) | |||||||||||||||||||||||||||||||||||||||||||||
Depreciation and amortization | 21,924 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest expense, net | 15,502 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Income (loss) before income taxes | $ | (57,236) |
Three Months Ended June 29, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
In thousands | Owned & Host | Legacy | Corporate/Other | Reconciliations | Total | ||||||||||||||||||||||||||||||||||||||||||||||||
Segment product revenues | $ | 260,867 | $ | 25,785 | $ | 62,341 | $ | 8,540 | $ | 357,533 | |||||||||||||||||||||||||||||||||||||||||||
Segment services and plans revenues | 59,549 | 13,479 | 5 | (1,115) | 71,918 | ||||||||||||||||||||||||||||||||||||||||||||||||
Total net revenue | 320,416 | 39,264 | 62,346 | 7,425 | 429,451 | ||||||||||||||||||||||||||||||||||||||||||||||||
Cost of products | 77,059 | 12,312 | 54,253 | 2,030 | 145,654 | ||||||||||||||||||||||||||||||||||||||||||||||||
Cost of services and plans | 50,581 | 6,270 | 1 | — | 56,852 | ||||||||||||||||||||||||||||||||||||||||||||||||
Total costs applicable to revenue | 127,640 | 18,582 | 54,254 | 2,030 | 202,506 | ||||||||||||||||||||||||||||||||||||||||||||||||
SG&A | 126,078 | 13,884 | 42,316 | — | 182,278 | ||||||||||||||||||||||||||||||||||||||||||||||||
Asset impairment | — | — | 1,790 | — | 1,790 | ||||||||||||||||||||||||||||||||||||||||||||||||
Other expense, net | — | — | 356 | — | 356 | ||||||||||||||||||||||||||||||||||||||||||||||||
EBITDA | $ | 66,698 | $ | 6,798 | $ | (36,370) | $ | 5,395 | |||||||||||||||||||||||||||||||||||||||||||||
Depreciation and amortization | 20,819 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest expense, net | 8,968 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Income before income taxes | $ | 12,734 |
Six Months Ended June 27, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
In thousands | Owned & Host | Legacy | Corporate/Other | Reconciliations | Total | ||||||||||||||||||||||||||||||||||||||||||||||||
Segment product revenues | $ | 459,343 | $ | 40,672 | $ | 117,044 | $ | (14,511) | $ | 602,548 | |||||||||||||||||||||||||||||||||||||||||||
Segment services and plans revenues | 99,589 | 21,198 | — | 6,376 | 127,163 | ||||||||||||||||||||||||||||||||||||||||||||||||
Total net revenue | 558,932 | 61,870 | 117,044 | (8,135) | 729,711 | ||||||||||||||||||||||||||||||||||||||||||||||||
Costs of products | 136,814 | 20,496 | 100,045 | (3,350) | 254,005 | ||||||||||||||||||||||||||||||||||||||||||||||||
Costs of services and plans | 94,167 | 11,162 | — | — | 105,329 | ||||||||||||||||||||||||||||||||||||||||||||||||
Total costs applicable to revenue | 230,981 | 31,658 | 100,045 | (3,350) | 359,334 | ||||||||||||||||||||||||||||||||||||||||||||||||
SG&A | 221,418 | 24,192 | 84,713 | — | 330,323 | ||||||||||||||||||||||||||||||||||||||||||||||||
Asset impairment | — | — | 13,766 | — | 13,766 | ||||||||||||||||||||||||||||||||||||||||||||||||
Debt issuance costs | — | — | 136 | — | 136 | ||||||||||||||||||||||||||||||||||||||||||||||||
Litigation settlement | — | — | 4,395 | — | 4,395 | ||||||||||||||||||||||||||||||||||||||||||||||||
Other expense (income), net | — | — | (158) | — | (158) | ||||||||||||||||||||||||||||||||||||||||||||||||
EBITDA | $ | 106,533 | $ | 6,020 | $ | (85,853) | $ | (4,785) | |||||||||||||||||||||||||||||||||||||||||||||
Depreciation and amortization | 46,734 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest expense, net | 22,957 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Income (loss) before income taxes | $ | (47,776) |
Three Months Ended March 28, 2020 | |||||||||||||||||||
In thousands | Owned & Host | Legacy | Corporate/Other | Reconciliations | Total | ||||||||||||||
Segment product revenues | $ | 281,914 | $ | 24,418 | $ | 66,571 | $ | 19,938 | $ | 392,841 | |||||||||
Segment services and plans revenues | 65,313 | 12,039 | — | (489 | ) | 76,863 | |||||||||||||
Total net revenue | 347,227 | 36,457 | 66,571 | 19,449 | 469,704 | ||||||||||||||
Costs of products | 81,917 | 11,404 | 57,907 | 5,142 | 156,370 | ||||||||||||||
Costs of services and plans | 55,594 | 6,590 | — | — | 62,184 | ||||||||||||||
Total costs applicable to revenue | 137,511 | 17,994 | 57,907 | 5,142 | 218,554 | ||||||||||||||
SG&A | 134,714 | 13,631 | 45,396 | — | 193,741 | ||||||||||||||
Asset impairment | — | — | 11,355 | — | 11,355 | ||||||||||||||
Litigation settlement | — | — | 4,395 | — | 4,395 | ||||||||||||||
Other expense (income), net | — | — | (66 | ) | — | (66 | ) | ||||||||||||
EBITDA | $ | 75,002 | $ | 4,832 | $ | (52,416 | ) | $ | 14,307 | ||||||||||
Depreciation and amortization | 24,810 | ||||||||||||||||||
Interest expense, net | 7,455 | ||||||||||||||||||
Income before income taxes | $ | 9,460 |
Three Months Ended March 30, 2019 | |||||||||||||||||||
In thousands | Owned & Host | Legacy | Corporate/Other | Reconciliations | Total | ||||||||||||||
Segment product revenues | $ | 296,919 | $ | 30,141 | $ | 63,875 | $ | (7,775 | ) | $ | 383,160 | ||||||||
Segment services and plans revenues | 68,301 | 14,437 | 6 | (4,689 | ) | 78,055 | |||||||||||||
Total net revenue | 365,220 | 44,578 | 63,881 | (12,464 | ) | 461,215 | |||||||||||||
Costs of products | 85,246 | 14,130 | 56,595 | (1,967 | ) | 154,004 | |||||||||||||
Costs of services and plans | 51,664 | 6,301 | — | — | 57,965 | ||||||||||||||
Total costs applicable to revenue | 136,910 | 20,431 | 56,595 | (1,967 | ) | 211,969 | |||||||||||||
SG&A | 133,213 | 14,237 | 46,426 | — | 193,876 | ||||||||||||||
Asset impairment | — | — | 2,082 | — | 2,082 | ||||||||||||||
Other expense, net | — | — | 473 | — | 473 | ||||||||||||||
EBITDA | $ | 95,097 | $ | 9,910 | $ | (41,695 | ) | $ | (10,497 | ) | |||||||||
Depreciation and amortization | 20,415 | ||||||||||||||||||
Interest expense, net | 9,061 | ||||||||||||||||||
Income before income taxes | $ | 23,339 |
Six Months Ended June 29, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
In thousands | Owned & Host | Legacy | Corporate/Other | Reconciliations | Total | ||||||||||||||||||||||||||||||||||||||||||||||||
Segment product revenues | $ | 557,786 | $ | 55,926 | $ | 126,216 | $ | 765 | $ | 740,693 | |||||||||||||||||||||||||||||||||||||||||||
Segment services and plans revenues | 127,850 | 27,916 | 11 | (5,804) | 149,973 | ||||||||||||||||||||||||||||||||||||||||||||||||
Total net revenue | 685,636 | 83,842 | 126,227 | (5,039) | 890,666 | ||||||||||||||||||||||||||||||||||||||||||||||||
Costs of products | 162,305 | 26,442 | 110,848 | 63 | 299,658 | ||||||||||||||||||||||||||||||||||||||||||||||||
Costs of services and plans | 102,245 | 12,571 | 1 | — | 114,817 | ||||||||||||||||||||||||||||||||||||||||||||||||
Total costs applicable to revenue | 264,550 | 39,013 | 110,849 | 63 | 414,475 | ||||||||||||||||||||||||||||||||||||||||||||||||
SG&A | 259,291 | 28,121 | 88,742 | — | 376,154 | ||||||||||||||||||||||||||||||||||||||||||||||||
Asset impairment | — | — | 3,872 | — | 3,872 | ||||||||||||||||||||||||||||||||||||||||||||||||
Other expense, net | — | — | 829 | — | 829 | ||||||||||||||||||||||||||||||||||||||||||||||||
EBITDA | $ | 161,795 | $ | 16,708 | $ | (78,065) | $ | (5,102) | |||||||||||||||||||||||||||||||||||||||||||||
Depreciation and amortization | 41,234 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest expense, net | 18,029 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Income before income taxes | $ | 36,073 |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||||||||
In thousands, except EPS | June 27, 2020 | June 29, 2019 | June 27, 2020 | June 29, 2019 | |||||||||||||||||||||||||||||||
Net income (loss) | $ | (43,833) | $ | 10,257 | $ | (34,091) | $ | 27,686 | |||||||||||||||||||||||||||
Weighted average shares outstanding for basic EPS | 80,325 | 78,318 | 80,226 | 78,262 | |||||||||||||||||||||||||||||||
Effect of dilutive securities: | |||||||||||||||||||||||||||||||||||
Stock options | — | 3,059 | — | 3,135 | |||||||||||||||||||||||||||||||
Restricted stock | — | 47 | — | 40 | |||||||||||||||||||||||||||||||
Weighted average shares outstanding for diluted EPS | 80,325 | — | 81,424 | 80,226 | 81,437 | ||||||||||||||||||||||||||||||
Basic EPS | $ | (0.55) | $ | 0.13 | $ | (0.42) | $ | 0.35 | |||||||||||||||||||||||||||
Diluted EPS | $ | (0.55) | $ | 0.13 | $ | (0.42) | $ | 0.34 | |||||||||||||||||||||||||||
Anti-dilutive options, RSUs outstanding excluded from EPS | 2,458 | 391 | 2,512 | 391 |
Three Months Ended | |||||||
In thousands, except EPS | March 28, 2020 | March 30, 2019 | |||||
Net income | $ | 9,742 | $ | 17,429 | |||
Weighted average shares outstanding for basic EPS | 80,129 | 78,205 | |||||
Effect of dilutive securities: | |||||||
Stock options | 2,020 | 3,221 | |||||
Restricted stock | 93 | 40 | |||||
Weighted average shares outstanding for diluted EPS | 82,242 | 81,466 | |||||
Basic EPS | $ | 0.12 | $ | 0.22 | |||
Diluted EPS | $ | 0.12 | $ | 0.21 | |||
Anti-dilutive options, RSUs outstanding excluded from EPS | 394 | 356 |
Six Months Ended | |||||||||||||||||
In thousands | June 27, 2020 | June 29, 2019 | |||||||||||||||
Cash and cash equivalents | $ | 256,292 | $ | 82,779 | |||||||||||||
Restricted cash included in other assets | 1,341 | 1,086 | |||||||||||||||
Total cash, cash equivalents and restricted cash | $ | 257,633 | $ | 83,865 |
Three Months Ended | |||||||
In thousands | March 28, 2020 | March 30, 2019 | |||||
Cash and cash equivalents | $ | 263,154 | $ | 72,506 | |||
Restricted cash included in other assets | 960 | 1,346 | |||||
Total cash, cash equivalents and restricted cash | $ | 264,114 | $ | 73,852 |
Three Months Ended | |||||||
In thousands | March 28, 2020 | March 30, 2019 | |||||
Cash flow hedging activity: | |||||||
Balance at beginning of period | $ | (3,814 | ) | $ | (2,810 | ) | |
Other comprehensive income (loss) before reclassification | (10,681 | ) | (2,188 | ) | |||
Tax effect of other comprehensive income (loss) before reclassification | 2,721 | 561 | |||||
Amount reclassified from AOCL into interest expense | 1,823 | 915 | |||||
Tax effect of amount reclassified from AOCL into interest expense | (465 | ) | (235 | ) | |||
Net current period other comprehensive income (loss), net of tax | (6,602 | ) | (947 | ) | |||
Balance at end of period | $ | (10,416 | ) | $ | (3,757 | ) |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||||||||
In thousands | June 27, 2020 | June 29, 2019 | June 27, 2020 | June 29, 2019 | |||||||||||||||||||||||||||||||
Cash flow hedging activity: | |||||||||||||||||||||||||||||||||||
Balance at beginning of period | $ | (10,416) | $ | (3,757) | $ | (3,814) | $ | (2,810) | |||||||||||||||||||||||||||
Other comprehensive income (loss) before reclassification | (360) | (3,132) | (11,041) | (5,320) | |||||||||||||||||||||||||||||||
Tax effect of other comprehensive income (loss) before reclassification | 92 | 803 | 2,813 | 1,364 | |||||||||||||||||||||||||||||||
Amount reclassified from AOCL into interest expense | 4,471 | 886 | 6,294 | 1,801 | |||||||||||||||||||||||||||||||
Tax effect of amount reclassified from AOCL into interest expense | (1,142) | (227) | (1,607) | (462) | |||||||||||||||||||||||||||||||
Net current period other comprehensive income (loss), net of tax | 3,061 | (1,670) | (3,541) | (2,617) | |||||||||||||||||||||||||||||||
Balance at end of period | $ | (7,355) | $ | (5,427) | $ | (7,355) | $ | (5,427) |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||||||||
In thousands, except store data | June 27, 2020 | June 29, 2019 | June 27, 2020 | June 29, 2019 | |||||||||||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||||||||||||||
Net product sales | $ | 209,707 | $ | 357,533 | $ | 602,548 | $ | 740,693 | |||||||||||||||||||||||||||
Net sales of services and plans | 50,300 | 71,918 | 127,163 | 149,973 | |||||||||||||||||||||||||||||||
Total net revenue | 260,007 | 429,451 | 729,711 | 890,666 | |||||||||||||||||||||||||||||||
Costs applicable to revenue (exclusive of depreciation and amortization): | |||||||||||||||||||||||||||||||||||
Products | 97,635 | 145,654 | 254,005 | 299,658 | |||||||||||||||||||||||||||||||
Services and plans | 43,145 | 56,852 | 105,329 | 114,817 | |||||||||||||||||||||||||||||||
Total costs applicable to revenue | 140,780 | 202,506 | 359,334 | 414,475 | |||||||||||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||||||||||
Selling, general and administrative expenses | 136,582 | 182,278 | 330,323 | 376,154 | |||||||||||||||||||||||||||||||
Depreciation and amortization | 21,924 | 20,819 | 46,734 | 41,234 | |||||||||||||||||||||||||||||||
Asset impairment | 2,411 | 1,790 | 13,766 | 3,872 | |||||||||||||||||||||||||||||||
Litigation settlement | — | — | 4,395 | — | |||||||||||||||||||||||||||||||
Other expense (income), net | (92) | 356 | (158) | 829 | |||||||||||||||||||||||||||||||
Total operating expenses | 160,825 | 205,243 | 395,060 | 422,089 | |||||||||||||||||||||||||||||||
Income (loss) from operations | (41,598) | 21,702 | (24,683) | 54,102 | |||||||||||||||||||||||||||||||
Interest expense, net | 15,502 | 8,968 | 22,957 | 18,029 | |||||||||||||||||||||||||||||||
Debt issuance costs | 136 | — | 136 | — | |||||||||||||||||||||||||||||||
Earnings (loss) before income taxes | (57,236) | 12,734 | (47,776) | 36,073 | |||||||||||||||||||||||||||||||
Income tax provision (benefit) | (13,403) | 2,477 | (13,685) | 8,387 | |||||||||||||||||||||||||||||||
Net income (loss) | $ | (43,833) | $ | 10,257 | $ | (34,091) | $ | 27,686 | |||||||||||||||||||||||||||
Operating data: | |||||||||||||||||||||||||||||||||||
Number of stores open at end of period | 1,185 | 1,128 | 1,185 | 1,128 | |||||||||||||||||||||||||||||||
New stores opened | 17 | 24 | 40 | 50 | |||||||||||||||||||||||||||||||
Adjusted Operating Income | $ | (34,427) | $ | 29,088 | $ | 3,638 | $ | 71,737 | |||||||||||||||||||||||||||
Diluted EPS | $ | (0.55) | $ | 0.13 | $ | (0.42) | $ | 0.34 | |||||||||||||||||||||||||||
Adjusted Diluted EPS | $ | (0.41) | $ | 0.18 | $ | (0.13) | $ | 0.49 | |||||||||||||||||||||||||||
Adjusted EBITDA | $ | (14,354) | $ | 48,056 | $ | 46,670 | $ | 109,269 | |||||||||||||||||||||||||||
Percentage of net revenue: | |||||||||||||||||||||||||||||||||||
Total costs applicable to revenue | 54.1 | % | 47.2 | % | 49.2 | % | 46.5 | % | |||||||||||||||||||||||||||
Selling, general and administrative | 52.5 | % | 42.4 | % | 45.3 | % | 42.2 | % | |||||||||||||||||||||||||||
Total operating expenses | 61.9 | % | 47.8 | % | 54.1 | % | 47.4 | % | |||||||||||||||||||||||||||
Income (loss) from operations | (16.0) | % | 5.1 | % | (3.4) | % | 6.1 | % | |||||||||||||||||||||||||||
Net income (loss) | (16.9) | % | 2.4 | % | (4.7) | % | 3.1 | % | |||||||||||||||||||||||||||
Adjusted Operating Income | (13.2) | % | 6.8 | % | 0.5 | % | 8.1 | % | |||||||||||||||||||||||||||
Adjusted EBITDA | (5.5) | % | 11.2 | % | 6.4 | % | 12.3 | % |
Three Months Ended | |||||||
In thousands, except store data | March 28, 2020 | March 30, 2019 | |||||
Revenue: | |||||||
Net product sales | $ | 392,841 | $ | 383,160 | |||
Net sales of services and plans | 76,863 | 78,055 | |||||
Total net revenue | 469,704 | 461,215 | |||||
Costs applicable to revenue (exclusive of depreciation and amortization): | |||||||
Products | 156,370 | 154,004 | |||||
Services and plans | 62,184 | 57,965 | |||||
Total costs applicable to revenue | 218,554 | 211,969 | |||||
Operating expenses: | |||||||
Selling, general and administrative expenses | 193,741 | 193,876 | |||||
Depreciation and amortization | 24,810 | 20,415 | |||||
Asset impairment | 11,355 | 2,082 | |||||
Litigation settlement | 4,395 | — | |||||
Other expense (income), net | (66 | ) | 473 | ||||
Total operating expenses | 234,235 | 216,846 | |||||
Income from operations | 16,915 | 32,400 | |||||
Interest expense, net | 7,455 | 9,061 | |||||
Earnings before income taxes | 9,460 | 23,339 | |||||
Income tax provision (benefit) | (282 | ) | 5,910 | ||||
Net income | $ | 9,742 | $ | 17,429 | |||
Operating data: | |||||||
Number of stores open at end of period | 1,173 | 1,105 | |||||
New stores opened | 23 | 26 | |||||
Adjusted Operating Income | $ | 38,063 | $ | 42,656 | |||
Diluted EPS | $ | 0.12 | $ | 0.21 | |||
Adjusted Diluted EPS | $ | 0.28 | $ | 0.31 | |||
Adjusted EBITDA | $ | 61,022 | $ | 61,220 |
Three Months Ended | |||||
March 28, 2020 | March 30, 2019 | ||||
Percentage of net revenue | |||||
Total costs applicable to revenue | 46.5 | % | 46.0 | % | |
Selling, general and administrative | 41.2 | % | 42.0 | % | |
Total operating expenses | 49.9 | % | 47.0 | % | |
Income from operations | 3.6 | % | 7.0 | % | |
Net income | 2.1 | % | 3.8 | % | |
Adjusted Operating Income | 8.1 | % | 9.2 | % | |
Adjusted EBITDA | 13.0 | % | 13.3 | % |
Comparable store sales growth(1) | Stores open at end of period | Net revenue(2) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
In thousands, except percentage and store data | Three Months Ended June 27, 2020 | Three Months Ended June 29, 2019 | June 27, 2020 | June 29, 2019 | Three Months Ended June 27, 2020 | Three Months Ended June 29, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Owned & Host segment | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
America’s Best | (37.1) | % | 4.5 | % | 753 | 702 | $ | 176,196 | 67.8 | % | $ | 266,781 | 62.1 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Eyeglass World | (31.6) | % | 5.2 | % | 118 | 117 | 30,357 | 11.7 | % | 44,059 | 10.3 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Military | (44.6) | % | 0.3 | % | 54 | 54 | 3,328 | 1.3 | % | 6,021 | 1.4 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fred Meyer | (48.6) | % | (5.3) | % | 29 | 29 | 1,824 | 0.7 | % | 3,555 | 0.8 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Owned & Host segment total | 954 | 902 | $ | 211,705 | 81.4 | % | $ | 320,416 | 74.6 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legacy segment | (35.8) | % | 0.4 | % | 231 | 226 | 25,413 | 9.8 | % | 39,264 | 9.1 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Corporate/Other | — | % | — | % | — | — | 50,472 | 19.4 | % | 62,346 | 14.6 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliations | — | % | — | % | — | — | (27,583) | (10.6) | % | 7,425 | 1.7 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | (44.7) | % | 4.4 | % | 1,185 | 1,128 | $ | 260,007 | 100.0 | % | $ | 429,451 | 100.0 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adjusted comparable store sales growth(3) | (36.5) | % | 3.8 | % |
Comparable store sales growth(1) | Stores open at end of period | Net revenue(2) | ||||||||||||||||||||||
In thousands, except percentage and store data | Three Months Ended March 28, 2020 | Three Months Ended March 30, 2019 | March 28, 2020 | March 30, 2019 | Three Months Ended March 28, 2020 | Three Months Ended March 30, 2019 | ||||||||||||||||||
Owned & Host segment | ||||||||||||||||||||||||
America’s Best | (9.3 | )% | 8.2 | % | 747 | 679 | $ | 294,170 | 62.6 | % | $ | 305,096 | 66.2 | % | ||||||||||
Eyeglass World | (12.1 | )% | 6.5 | % | 117 | 116 | 44,486 | 9.5 | % | 50,214 | 10.9 | % | ||||||||||||
Military | (12.1 | )% | (4.4 | )% | 54 | 54 | 5,642 | 1.2 | % | 6,421 | 1.4 | % | ||||||||||||
Fred Meyer | (16.0 | )% | (9.7 | )% | 29 | 29 | 2,929 | 0.6 | % | 3,489 | 0.8 | % | ||||||||||||
Owned & Host segment total | 947 | 878 | $ | 347,227 | 73.9 | % | $ | 365,220 | 79.3 | % | ||||||||||||||
Legacy segment | (14.0 | )% | 1.8 | % | 226 | 227 | 36,457 | 7.8 | % | 44,578 | 9.7 | % | ||||||||||||
Corporate/Other | — | — | — | — | 66,571 | 14.2 | % | 63,881 | 13.7 | % | ||||||||||||||
Reconciliations | — | — | — | — | 19,449 | 4.1 | % | (12,464 | ) | (2.7 | )% | |||||||||||||
Total | (2.9 | )% | 6.2 | % | 1,173 | 1,105 | $ | 469,704 | 100.0 | % | $ | 461,215 | 100.0 | % | ||||||||||
Adjusted Comparable Store Sales Growth(3) | (10.3 | )% | 6.7 | % |
Comparable store sales growth(1) | Stores open at end of period | Net revenue(2) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
In thousands, except percentage and store data | Six Months Ended June 27, 2020 | Six Months Ended June 29, 2019 | June 27, 2020 | June 29, 2019 | Six Months Ended June 27, 2020 | Six Months Ended June 29, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Owned & Host segment | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
America’s Best | (22.2) | % | 6.4 | % | 753 | 702 | $ | 470,366 | 64.5 | % | $ | 571,877 | 64.2 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Eyeglass World | (21.2) | % | 5.9 | % | 118 | 117 | 74,843 | 10.3 | % | 94,273 | 10.6 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Military | (27.8) | % | (2.2) | % | 54 | 54 | 8,970 | 1.2 | % | 12,442 | 1.4 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fred Meyer | (32.5) | % | (7.5) | % | 29 | 29 | 4,753 | 0.7 | % | 7,044 | 0.8 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Owned & Host segment total | 954 | 902 | $ | 558,932 | 76.6 | % | $ | 685,636 | 77.0 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legacy segment | (24.4) | % | 1.1 | % | 231 | 226 | 61,870 | 8.5 | % | 83,842 | 9.4 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Corporate/Other | — | — | — | — | 117,044 | 16.0 | % | 126,227 | 14.2 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliations | — | — | — | — | (8,135) | (1.1) | % | (5,039) | (0.6) | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | (23.0) | % | 5.4 | % | 1,185 | 1,128 | $ | 729,711 | 100.0 | % | $ | 890,666 | 100.0 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adjusted Comparable Store Sales Growth(3) | (22.6) | % | 5.3 | % |
Three Months Ended | ||||||||||
In thousands | March 28, 2020 | March 30, 2019 | ||||||||
Net income | $ | 9,742 | 2.1% | $ | 17,429 | 3.8% | ||||
Interest expense | 7,455 | 1.6% | 9,061 | 2.0% | ||||||
Income tax provision (benefit) | (282 | ) | (0.1)% | 5,910 | 1.3% | |||||
Stock compensation expense (a) | 2,093 | 0.4% | 2,976 | 0.6% | ||||||
Asset impairment (b) | 11,355 | 2.4% | 2,082 | 0.5% | ||||||
Litigation settlement (c) | 4,395 | 0.9% | — | —% | ||||||
Management realignment expenses (d) | — | —% | 2,155 | 0.5% | ||||||
Other (e) | 1,454 | 0.3% | 1,192 | 0.3% | ||||||
Amortization of acquisition intangibles (i) | 1,851 | 0.4% | 1,851 | 0.4% | ||||||
Adjusted Operating Income / Adjusted Operating Margin | $ | 38,063 | 8.1% | $ | 42,656 | 9.2% | ||||
Note: Percentages reflect line item as a percentage of net revenue, adjusted for rounding. Some of the percentage totals in the table above do not foot due to rounding differences |
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
In thousands | June 27, 2020 | June 29, 2019 | June 27, 2020 | June 29, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | $ | (43,833) | (16.9)% | $ | 10,257 | 2.4% | $ | (34,091) | (4.7)% | $ | 27,686 | 3.1% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest expense | 15,502 | 6.0% | 8,968 | 2.1% | 22,957 | 3.1% | 18,029 | 2.0% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income tax provision (benefit) | (13,403) | (5.2)% | 2,477 | 0.6% | (13,685) | (1.9)% | 8,387 | 0.9% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock compensation expense (a) | 3,352 | 1.3% | 1,741 | 0.4% | 5,445 | 0.7% | 4,717 | 0.5% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Asset impairment (b) | 2,411 | 0.9% | 1,790 | 0.4% | 13,766 | 1.9% | 3,872 | 0.4% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Litigation settlement (c) | — | —% | — | —% | 4,395 | 0.6% | — | —% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Management realignment expenses (d) | — | —% | — | —% | — | —% | 2,155 | 0.2% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-term incentive plan (e) | — | —% | 781 | 0.2% | — | —% | 722 | 0.1% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amortization of acquisition intangibles (f) | 1,851 | 0.7% | 1,851 | 0.4% | 3,702 | 0.5% | 3,702 | 0.4% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other (i) | (307) | (0.1)% | 1,223 | 0.3% | 1,149 | 0.2% | 2,467 | 0.3% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adjusted Operating Income / Adjusted Operating Margin | $ | (34,427) | (13.2)% | $ | 29,088 | 6.8% | $ | 3,638 | 0.5% | $ | 71,737 | 8.1% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Note: Percentages reflect line item as a percentage of net revenue, adjusted for rounding. Some of the percentage totals in the table above do not foot due to rounding differences. |
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
In thousands | June 27, 2020 | June 29, 2019 | June 27, 2020 | June 29, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | $ | (43,833) | (16.9) | % | $ | 10,257 | 2.4 | % | $ | (34,091) | (4.7)% | $ | 27,686 | 3.1% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest expense | 15,502 | 6.0 | % | 8,968 | 2.1 | % | 22,957 | 3.1% | 18,029 | 2.0% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income tax provision (benefit) | (13,403) | (5.2) | % | 2,477 | 0.6 | % | (13,685) | (1.9)% | 8,387 | 0.9% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Depreciation and amortization | 21,924 | 8.4 | % | 20,819 | 4.8 | % | 46,734 | 6.4% | 41,234 | 4.6% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EBITDA | (19,810) | (7.6) | % | 42,521 | 9.9 | % | 21,915 | 3.0% | 95,336 | 10.7% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock compensation expense (a) | 3,352 | 1.3 | % | 1,741 | 0.4 | % | 5,445 | 0.7% | 4,717 | 0.5% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Asset impairment (b) | 2,411 | 0.9 | % | 1,790 | 0.4 | % | 13,766 | 1.9% | 3,872 | 0.4% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Litigation settlement (c) | — | — | % | — | — | % | 4,395 | 0.6% | — | —% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Management realignment expenses (d) | — | — | % | — | — | % | — | —% | 2,155 | 0.2% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-term incentive plan (e) | — | — | % | 781 | 0.2 | % | — | —% | 722 | 0.1% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other (i) | (307) | (0.1) | % | 1,223 | 0.3 | % | 1,149 | 0.2% | 2,467 | 0.3% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adjusted EBITDA / Adjusted EBITDA Margin | $ | (14,354) | (5.5) | % | $ | 48,056 | 11.2 | % | $ | 46,670 | 6.4% | $ | 109,269 | 12.3% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Note: Percentages reflect line item as a percentage of net revenue, adjusted for rounding. Some of the percentage totals in the table above do not foot due to rounding differences |
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||||||||||||||||||
In thousands, except per share amounts | June 27, 2020 | June 29, 2019 | June 27, 2020 | June 29, 2019 | ||||||||||||||||||||||||||||||||||||||||
Diluted EPS | $ | (0.55) | $ | 0.13 | $ | (0.42) | $ | 0.34 | ||||||||||||||||||||||||||||||||||||
Stock compensation expense (a) | 0.04 | 0.02 | 0.07 | 0.06 | ||||||||||||||||||||||||||||||||||||||||
Asset impairment (b) | 0.03 | 0.02 | 0.17 | 0.05 | ||||||||||||||||||||||||||||||||||||||||
Litigation settlement (c) | — | — | 0.05 | — | ||||||||||||||||||||||||||||||||||||||||
Management realignment expenses (d) | — | — | — | 0.03 | ||||||||||||||||||||||||||||||||||||||||
Long-term incentive plan (e) | — | 0.01 | — | 0.01 | ||||||||||||||||||||||||||||||||||||||||
Amortization of acquisition intangibles (f) | 0.02 | 0.02 | 0.05 | 0.05 | ||||||||||||||||||||||||||||||||||||||||
Amortization of debt discount and deferred financing costs (g) | 0.03 | 0.01 | 0.03 | 0.01 | ||||||||||||||||||||||||||||||||||||||||
Losses (gains) on change in fair value of derivatives (h) | 0.06 | — | 0.06 | — | ||||||||||||||||||||||||||||||||||||||||
Other (i) | — | 0.02 | 0.01 | 0.03 | ||||||||||||||||||||||||||||||||||||||||
Tax benefit of stock option exercises (j) | — | (0.01) | (0.04) | (0.02) | ||||||||||||||||||||||||||||||||||||||||
Tax effect of total adjustments (k) | (0.05) | (0.02) | (0.12) | (0.06) | ||||||||||||||||||||||||||||||||||||||||
Adjusted Diluted EPS | $ | (0.41) | $ | 0.18 | $ | (0.13) | $ | 0.49 | ||||||||||||||||||||||||||||||||||||
Weighted average diluted shares outstanding | 80,325 | 81,424 | 80,226 | 81,437 | ||||||||||||||||||||||||||||||||||||||||
Note: Some of the totals in the table above do not foot due to rounding differences |
Three Months Ended | |||||||||
In thousands | March 28, 2020 | March 30, 2019 | |||||||
Net income | $ | 9,742 | 2.1% | $ | 17,429 | 3.8% | |||
Interest expense | 7,455 | 1.6% | 9,061 | 2.0% | |||||
Income tax provision (benefit) | (282 | ) | (0.1)% | 5,910 | 1.3% | ||||
Depreciation and amortization | 24,810 | 5.3% | 20,415 | 4.4% | |||||
EBITDA | 41,725 | 8.9% | 52,815 | 11.5% | |||||
Stock compensation expense (a) | 2,093 | 0.4% | 2,976 | 0.6% | |||||
Asset impairment (b) | 11,355 | 2.4% | 2,082 | 0.5% | |||||
Litigation settlement (c) | 4,395 | 0.9% | — | —% | |||||
Management realignment expenses (d) | — | —% | 2,155 | 0.5% | |||||
Other (e) | 1,454 | 0.3% | 1,192 | 0.3% | |||||
Adjusted EBITDA / Adjusted EBITDA Margin | $ | 61,022 | 13.0% | $ | 61,220 | 13.3% | |||
Note: Percentages reflect line item as a percentage of net revenue, adjusted for rounding. Some of the percentage totals in the table above do not foot due to rounding differences |
Three Months Ended | ||||||||
In thousands, except per share amounts | March 28, 2020 | March 30, 2019 | ||||||
Diluted EPS | $ | 0.12 | $ | 0.21 | ||||
Stock compensation expense (a) | 0.03 | 0.04 | ||||||
Asset impairment (b) | 0.14 | 0.03 | ||||||
Litigation settlement (c) | 0.05 | — | ||||||
Management realignment expenses (d) | — | 0.03 | ||||||
Other (e) | 0.02 | 0.01 | ||||||
Amortization of acquisition intangibles and deferred financing costs (f) | 0.03 | 0.03 | ||||||
Tax benefit of stock option exercises (g) | (0.03 | ) | — | |||||
Tax effect of total adjustments (h) | (0.07 | ) | (0.04 | ) | ||||
Adjusted Diluted EPS | $ | 0.28 | $ | 0.31 | ||||
Weighted average diluted shares outstanding | 82,242 | 81,466 | ||||||
Note: Some of the totals in the table above do not foot due to rounding differences |
Three Months Ended | Six Months Ended | |||||||||||||||||||||||
In thousands | March 28, 2020 | March 30, 2019 | In thousands | June 27, 2020 | June 29, 2019 | |||||||||||||||||||
Cash flows provided by (used for): | Cash flows provided by (used for): | |||||||||||||||||||||||
Operating activities | $ | 86,060 | $ | 83,014 | Operating activities | $ | 71,420 | $ | 119,279 | |||||||||||||||
Investing activities | (12,854 | ) | (25,806 | ) | Investing activities | (25,531) | (51,788) | |||||||||||||||||
Financing activities | 150,601 | (1,354 | ) | Financing activities | 171,437 | (1,624) | ||||||||||||||||||
Net increase in cash, cash equivalents and restricted cash | $ | 223,807 | $ | 55,854 | Net increase in cash, cash equivalents and restricted cash | $ | 217,326 | $ | 65,867 |
significant operating and financial restrictions, including financial maintenance and restrictive covenants, in our recently amended credit agreement and restrictions in the indenture governing our outstanding convertible notes, that may limit the ability of us and our subsidiaries, under certain circumstances, to, among other things, incur additional indebtedness; engage in certain fundamental changes, including mergers or consolidations; make acquisitions, investments, loans or advances; pay or modify the terms of certain indebtedness; limitations in how we conduct our business; and our ability to raise additional debt or equity financing. |
•our operations could be disrupted if key members of our senior management or a significant percentage of our workforce or the workforce of our outsourced laboratories or suppliers are unable to continue to work because of illness, government directives or otherwise. In addition, the interruption of our or their system capabilities could result in a deterioration of our ability to fulfill and sell our products and services, provide customer service or perform other necessary business functions. Having shifted to remote working arrangements, we also face a heightened risk of cybersecurity attacks or data security incidents and are more dependent on internet and telecommunications access and capabilities that are less uniform than in our dedicated workspaces. |
•Revenues. We expect that the impact of COVID-19 on general economic activity |
•Selling, general and administrative. We have incurred and will continue to incur, general and administrative expenses primarily related to occupancy costs of our stores, advertising expenses, payroll related to store associates and unallocated corporate overhead expenses such as payroll, consulting and professional fees and incremental costs directly related to adapting the Company’s operations during the COVID-19 pandemic. We may experience elevated frequency and severity in our workers’ compensation claims liabilities by workers who demonstrate that the injury or illness arose both out of and in the course of their employment. We expect selling, general and administrative expenses as a percentage of revenues to increase compared to previous years primarily due to an overall decrease in revenues for fiscal year 2020. •Assetimpairment. The Company considered the disruption in the economy experienced during the six months ended June 27, 2020 and expected to persist through the end of the current fiscal year in recording asset impairments. We evaluate impairment of long-lived tangible and ROU store assets at the store level and consider multiple factors including financial performance of the stores, regional and local business climates, future plans for the store operations and other qualitative factors. Asset fair values used in impairment are determined using an income approach based on discounted cash flows, which requires estimates and assumptions related to forecasted store revenue growth rates and store profitability. A significant decrease in the estimated cash inflows from our stores in future periods could affect the recoverability of our store level assets as well as other intangible assets of the Company such as goodwill, trademarks and customer relationship. Lower cash flows compared to estimates would lead to a material increase in the asset impairment expense recorded by the Company. |
Exhibit No. | Exhibit Description | |||||||
Second Amended and Restated Certificate of Incorporation of National Vision Holdings, Inc. -incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on October 31, 2017. | ||||||||
Second Amended and Restated Bylaws of National Vision Holdings, Inc. -incorporated herein by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K filed on October 31, 2017. | ||||||||
Indenture, dated as of May 12, 2020, between National Vision Holdings, Inc. and U.S. Bank National Association, as trustee -incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on May 12, 2020. | ||||||||
Form of 2.50% Convertible Senior Note due 2025 -included in Exhibit A in and incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on May 12, 2020. | ||||||||
Amendment No. 1, dated as of May 5, 2020, to the Amended and Restated Credit Agreement, dated as of July 18, 2019 by and among Nautilus Acquisition Holdings, Inc., National Vision, Inc., certain subsidiaries of National Vision, Inc., as guarantors, Bank of America, N.A., as administrative agent and collateral agent, and the lenders from time to time party thereto. -incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 10-Q filed on May 7, 2020. | ||||||||
Amendment | ||||||||
Certification of Periodic Report by Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith). | ||||||||
Certification of Periodic Report by Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith). | ||||||||
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 (furnished herewith). | ||||||||
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 (furnished herewith). | ||||||||
101.INS | Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within Inline XBRL document | |||||||
101.SCH | Inline XBRL Taxonomy Extension Schema Document. | |||||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | |||||||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. | |||||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document. | |||||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | |||||||
104 | The cover page of the Company’s Quarterly report on Form 10-Q for the quarter ended |
National Vision Holdings, Inc. | |||||||||||
Dated: | By: | /s/ L. Reade Fahs | |||||||||
Chief Executive Officer and Director | |||||||||||
(Principal Executive Officer) | |||||||||||
Dated: | By: | /s/ Patrick R. Moore | |||||||||
Senior Vice President, Chief Financial Officer | |||||||||||
(Principal Financial Officer) |