Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Feb. 03, 2018 | Mar. 27, 2018 | Jul. 28, 2017 | |
Document And Entity Information | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Feb. 3, 2018 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | SPORTSMAN'S WAREHOUSE HOLDINGS, INC. | ||
Entity Central Index Key | 1,132,105 | ||
Current Fiscal Year End Date | --02-03 | ||
Entity Filer Category | Accelerated Filer | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Public Float | $ 172,997,516 | ||
Entity Common Stock, Shares Outstanding | 42,617,757 | ||
Entity Current Reporting Status | Yes |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Feb. 03, 2018 | Jan. 28, 2017 |
Current assets: | ||
Cash | $ 1,769 | $ 1,911 |
Accounts receivable, net | 319 | 411 |
Merchandise inventories | 270,594 | 246,289 |
Prepaid expenses and other | 8,073 | 7,313 |
Total current assets | 280,755 | 255,924 |
Property and equipment, net | 94,035 | 83,109 |
Deferred income taxes | 4,595 | 5,097 |
Definite lived intangibles, net | 276 | 2,118 |
Total assets | 379,661 | 346,248 |
Current liabilities: | ||
Accounts payable | 36,788 | 31,549 |
Accrued expenses | 50,602 | 49,586 |
Income taxes payable | 2,586 | 979 |
Revolving line of credit | 59,992 | 60,972 |
Current portion of long-term debt, net of discount and debt issuance costs | 990 | 983 |
Current portion of deferred rent | 4,593 | 3,150 |
Total current liabilities | 155,551 | 147,219 |
Long-term liabilities: | ||
Long-term debt, net of discount, debt issuance costs, and current portion | 132,349 | 133,721 |
Deferred rent, noncurrent | 41,963 | 35,307 |
Total long-term liabilities | 174,312 | 169,028 |
Total liabilities | 329,863 | 316,247 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $.01 par value; 20,000 shares authorized; 0 shares issued and outstanding | ||
Common stock, $.01 par value; 100,000 shares authorized; 42,617 and 42,269 shares issued and outstanding, respectively | 426 | 422 |
Additional paid-in capital | 82,197 | 80,146 |
Accumulated deficit | (32,825) | (50,567) |
Total stockholders' equity | 49,798 | 30,001 |
Total liabilities and stockholders' equity | $ 379,661 | $ 346,248 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Feb. 03, 2018 | Jan. 28, 2017 |
CONSOLIDATED BALANCE SHEETS | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 20,000 | 20,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000 | 100,000 |
Common stock, shares issued | 42,617 | 42,269 |
Common stock, shares outstanding | 42,617 | 42,269 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Feb. 03, 2018 | Jan. 28, 2017 | Jan. 30, 2016 | |
CONSOLIDATED STATEMENTS OF INCOME | |||
Net sales | $ 809,671 | $ 779,956 | $ 706,764 |
Cost of goods sold | 535,811 | 516,726 | 468,234 |
Gross profit | 273,860 | 263,230 | 238,530 |
Selling, general, and administrative expenses | 227,292 | 202,543 | 179,218 |
Income from operations | 46,568 | 60,687 | 59,312 |
Interest expense | (13,738) | (13,402) | (14,156) |
Income before income taxes | 32,830 | 47,285 | 45,156 |
Income tax expense | 15,088 | 17,616 | 17,385 |
Net income | $ 17,742 | $ 29,669 | $ 27,771 |
Earnings per share: | |||
Basic | $ 0.42 | $ 0.70 | $ 0.66 |
Diluted | $ 0.42 | $ 0.70 | $ 0.66 |
Weighted average shares outstanding: | |||
Basic | 42,496 | 42,187 | 41,966 |
Diluted | 42,522 | 42,485 | 42,334 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) - USD ($) shares in Thousands, $ in Thousands | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance, shares at Jan. 31, 2015 | 41,818 | |||
Balance at Jan. 31, 2015 | $ 418 | $ 76,257 | $ (108,007) | $ (31,332) |
Vesting of restricted stock units (in shares) | 186 | |||
Vesting of restricted stock units | $ 2 | (2) | ||
Payment of withholdings on restricted stock units | (1,041) | (1,041) | ||
Excess tax benefit from restricted stock units | 286 | 286 | ||
Stock based compensation | 2,257 | 2,257 | ||
Net income | 27,771 | 27,771 | ||
Balance, shares at Jan. 30, 2016 | 42,004 | |||
Balance at Jan. 30, 2016 | $ 420 | 77,757 | (80,236) | (2,059) |
Vesting of restricted stock units (in shares) | 207 | |||
Vesting of restricted stock units | $ 2 | (2) | ||
Payment of withholdings on restricted stock units | (1,228) | (1,228) | ||
Issuance of common stock for cash per employee stock purchase plan (in shares) | 58 | |||
Issuance of common stock for cash per employee stock purchase plan | 433 | 433 | ||
Stock based compensation | 3,186 | 3,186 | ||
Net income | 29,669 | $ 29,669 | ||
Balance, shares at Jan. 28, 2017 | 42,269 | 42,269 | ||
Balance at Jan. 28, 2017 | $ 422 | 80,146 | (50,567) | $ 30,001 |
Vesting of restricted stock units (in shares) | 260 | |||
Vesting of restricted stock units | $ 3 | (3) | ||
Payment of withholdings on restricted stock units | (635) | (635) | ||
Issuance of common stock for cash per employee stock purchase plan (in shares) | 88 | |||
Issuance of common stock for cash per employee stock purchase plan | $ 1 | 395 | 396 | |
Stock based compensation | 2,294 | 2,294 | ||
Net income | 17,742 | $ 17,742 | ||
Balance, shares at Feb. 03, 2018 | 42,617 | 42,617 | ||
Balance at Feb. 03, 2018 | $ 426 | $ 82,197 | $ (32,825) | $ 49,798 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 03, 2018 | Jan. 28, 2017 | Jan. 30, 2016 | |
Cash flows from operating activities: | |||
Net income | $ 17,742 | $ 29,669 | $ 27,771 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||
Depreciation of property and equipment | 15,864 | 12,169 | 9,763 |
Amortization of discount on debt and deferred financing fees | 708 | 1,122 | 817 |
Amortization of definite lived intangible | 1,842 | 1,805 | 1,806 |
Change in deferred rent | 8,098 | 6,307 | 1,161 |
Loss on asset dispositions | 516 | ||
Deferred income taxes | 502 | 167 | 3,062 |
Excess tax benefits from stock-based compensation arrangements | (449) | (286) | |
Stock-based compensation | 2,294 | 3,186 | 2,257 |
Change in operating assets and liabilities: | |||
Accounts receivable, net | 92 | 58 | (44) |
Merchandise inventories | (24,305) | (28,495) | (31,885) |
Prepaid expenses and other | (681) | (1,064) | (5,435) |
Accounts payable | 7,536 | (15,530) | 18,198 |
Accrued expenses | (1,040) | 6,888 | 983 |
Income taxes payable and receivable | 1,607 | (351) | 7,255 |
Net cash provided by operating activities | 30,775 | 15,482 | 35,423 |
Cash flows from investing activities: | |||
Purchase of property and equipment | (41,172) | (39,417) | (33,957) |
Proceeds from deemed sale-leaseback transactions | 9,022 | 11,923 | 19,006 |
Proceeds from sale of property and equipment | 14 | ||
Net cash used in investing activities | (32,136) | (27,494) | (14,951) |
Cash flows from financing activities: | |||
Net borrowings on line of credit | (980) | 35,709 | (16,636) |
Increase (decrease) in book overdraft | 4,589 | (1,827) | (1,123) |
Proceeds from issuance of common stock per employee stock purchase plan | 396 | 433 | |
Excess tax benefits from stock-based compensation arrangements | 286 | ||
Payment of withholdings on restricted stock units | (635) | (1,228) | (1,041) |
Payment of deferred financing costs | (551) | ||
Principal payments on long-term debt | (1,600) | (21,273) | (1,600) |
Net cash provided by (used in) financing activities | 1,219 | 11,814 | (20,114) |
Net change in cash | (142) | (198) | 358 |
Cash at beginning of period | 1,911 | 2,109 | 1,751 |
Cash at end of period | 1,769 | 1,911 | 2,109 |
Cash paid during the period for: | |||
Interest, net of amounts capitalized | 13,532 | 11,965 | 16,408 |
Income taxes | 12,839 | 18,444 | 10,328 |
Supplemental schedule of noncash investing activities: | |||
Purchases of property and equipment included in accounts payable and accrued expenses | $ 1,142 | $ 5,972 | $ 1,263 |
Nature of Business
Nature of Business | 12 Months Ended |
Feb. 03, 2018 | |
Nature of Business | |
Nature of Business | (1) Nature of Business Description of Business Sportsman’s Warehouse Holdings, Inc. (“Holdings”), a Delaware Corporation, and subsidiaries (collectively, the “Company”) operate retail sporting goods stores. As of February 3, 2018, the Company operated 87 stores in 22 states. Voluntary Reorganization under Chapter 11 On March 21, 2009, the Company and all of its subsidiaries filed a voluntary bankruptcy petition for reorganization under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). On July 30, 2009, the Bankruptcy Court entered an order approving and confirming the Plan of Reorganization (the “Reorganization Plan”). On May 22, 2013, the Company’s bankruptcy case was closed after a final decree was entered by the Bankruptcy Court. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Feb. 03, 2018 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | (2) Summary of Significant Accounting Policies Principles of Consolidation The consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and include the accounts of its four wholly owned subsidiaries, Sportsman’s Warehouse, Inc. (“Sportsman’s Warehouse”), Pacific Flyway Wholesale, LLC (“Pacific Flyway”), Sportsman’s Warehouse Southwest, Inc., and Minnesota Merchandising Corporation. All intercompany transactions and accounts have been eliminated in consolidation. Fiscal Year The Company operates using a 52/53 week fiscal year ending on the Saturday closest to January 31. Fiscal year 2017 ended February 3, 2018 and contained 53 weeks of operation. Fiscal years 2016 and 2015 ended January 28, 2017, and January 30, 2016, respectively and each contained 52 weeks of operations. Seasonality The Company’s business is generally seasonal, with a significant portion of total sales occurring during the third and fourth quarters of the fiscal year. Use of Estimates in the Preparation of Consolidated Financial Statements The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Segment Reporting The Company operates solely as a sporting goods retailer whose Chief Operating Decision Maker (“CODM”) is the Chief Executive Officer. The CODM reviews financial information presented on a consolidated and individual store and cost center basis, for purposes of allocating resources and evaluating financial performance. The Company’s stores typically have similar square footage and offer essentially the same general product mix. The Company’s core customer demographic remains similar chainwide, as does the Company’s process for the procurement and marketing of its product mix. Furthermore, the Company distributes its product mix chainwide from a single distribution center. Given that the stores have the same economic characteristics, the individual stores are aggregated into one single operating and reportable segment. Cash The Company considers cash on hand in stores and highly liquid investments with an initial maturity of three months or less as cash. Checks issued pending bank clearance that result in overdraft balances for accounting purposes are classified as accrued expenses in the accompanying consolidated balance sheets. In accordance with the terms of a financing agreement (Note 8), the Company maintains depository accounts with two banks in a lock-box arrangement. Deposits into these accounts are used to reduce the outstanding balance on the line of credit as soon as the respective bank allows the funds to be transferred to the financing company. At February 3, 2018 and January 28, 2017, the combined balance in these accounts were $6,629 and $6,138, respectively. Accordingly, these amounts have been classified as a reduction in the line of credit as if the transfers had occurred on February 3, 2018 and January 28, 2017, respectively. Accounts Receivable The Company offers credit terms on the sale of products to certain government and corporate retail customers and requires no collateral from these customers. The Company performs ongoing credit evaluations of its customers’ financial condition and maintains an allowance for doubtful accounts receivable based upon historical experience and a specific review of accounts receivable at the end of each period. Actual bad debts may differ from these estimates and the difference could be significant. At February 3, 2018 and January 28, 2017, the Company had no allowance for doubtful accounts receivable. Merchandise Inventories The Company adopted Accounting Standards Updates (“ASU”) 2015-11 “Simplifying the Measurement of Inventory” in the first quarter of fiscal year 2017 and has measured its inventory at the lower of cost or net realizable value. This adoption had no impact on the value of inventory presented on the consolidated balance sheet for the fiscal year 2017. Cost is determined using the weighted average cost method. The Company estimates a provision for inventory shrinkage based on its historical inventory accuracy rates as determined by periodic cycle counts. The Company also adjusts inventory for obsolete, slow moving, or damaged inventory based on inventory activity thresholds and by specific identification of slow moving or obsolete inventory. The inventory reserves for shrinkage, damaged, or obsolescence totaled $7,139 and $6,539 at February 3, 2018 and January 28, 2017, respectively. Property and Equipment Property and equipment are recorded at cost. Leasehold improvements primarily include the cost of improvements funded by landlord incentives or allowances. Maintenance, repairs, minor renewals, and betterments are expensed as incurred. Major renewals and betterments are capitalized. Upon retirement or disposal of assets, the cost and accumulated depreciation and amortization are eliminated from the respective accounts and the related gains or losses are credited or charged to earnings. Depreciation and amortization of property and equipment is computed using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized over the shorter of the useful lives of the improvements or the term of the lease. Furniture, fixtures, and equipment, are depreciated over useful lives ranging from 3 to 10 years. Impairment of Long-Lived Assets The Company reviews its long-lived assets with definite lives for impairment whenever events or changes in circumstances may indicate that the carrying value of an asset may not be recoverable. The Company uses an estimate of the future undiscounted net cash flows of the related asset or group of assets over their remaining useful lives in measuring whether the assets are recoverable. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount exceeds the estimated fair value of the asset. Impairment of long-lived assets is assessed at the lowest levels for which there are identifiable cash flows that are independent of other groups of assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less the estimated costs to sell. No impairment charge to long-lived assets was recorded during the fiscal years ended February 3, 2018, January 28, 2017, or January 30, 2016. Prepaid Expenses and Other Prepaid expenses and other primarily consists of prepaid expenses, vendor rebates receivable, vendor advertising receivables and miscellaneous deposits. Revenue Recognition Revenue is recognized for retail sales at the time of the sale in the store. The Company records a reserve for estimated product returns in each reporting period, based on its historical experience. The Company’s reserve for estimated returns and discounts is recorded against retail sales on a net basis. The Company’s sales returns reserve was $697 and $964 at February 3, 2018, and January 28, 2017, respectively. Revenue for gift cards sold is deferred and recognized as the gift cards are redeemed for merchandise. Gift card breakage income is recognized based upon historical redemption patterns and represents the balance of gift cards for which the Company believes the likelihood of redemption by the customer is remote. During the fiscal years ended February 3, 2018, January 28, 2017, and January 30, 2016, the Company recognized $1,337, $347, and $846 of gift card breakage income, respectively. This income is included in the accompanying consolidated statements of income as a reduction in selling, general, and administrative expenses (“SG&A”). In November of 2013, the Company launched a customer loyalty program. Under this program, the Company issues credits in the form of points to loyalty program members. The value of points earned by loyalty program members is included in accrued liabilities and recorded as a reduction of net sales at the time the points are earned. Loyalty breakage income is recognized based upon the balance of loyalty points that have expired after a dormancy period of 18 months. During the fiscal year ended February 3, 2018, January 28, 2017, and January 30, 2016 the Company recognized $1,022, $611 and $232, respectively of loyalty breakage income. This income is included in the accompanying consolidated statements of income as an increase in net sales. Customer deposits on items placed in layaway are recorded as a liability. Revenue is recognized on layaway transactions at the point where the customer takes possession of the merchandise. These liabilities are recorded as unearned revenue in accrued expenses in the consolidated balance sheets. Sales taxes collected from customers and remitted to governmental authorities are accounted for on a net basis and, therefore, are excluded from net sales in the consolidated statements of income. Cost of Goods Sold Cost of goods sold primarily consists of merchandise acquisition costs, including freight-in costs, shipping costs, terms discounts received from the vendor and vendor allowances and rebates associated directly with merchandise. Vendor allowances include allowances and rebates received from vendors. The Company records an estimate of earned allowances based on purchase volumes. These funds are determined for each fiscal year, and the majority is based on various quantitative contract terms. Amounts expected to be received from vendors relating to purchase of merchandise inventories are recognized as a reduction of cost of goods sold as the merchandise is sold. Historical program results and current purchase volumes are reviewed when establishing the estimate for earned allowances. Shipping and Handling Fees and Costs All shipping and handling fees billed to customers are recorded as a component of net sales. All costs incurred related to the shipping and handling of products are recorded in cost of sales. Vendor Allowances Vendor allowances include price allowances, volume rebates, store opening costs reimbursements, marketing participation and advertising reimbursements received from vendors under the terms of specific arrangements with certain vendors. Vendor allowances related to merchandise are recognized as a reduction of the costs of merchandise as sold. Vendor reimbursements of costs are recorded as a reduction to expense in the period the related cost is incurred based on actual costs incurred. Any cost reimbursements exceeding expenses incurred are recognized as a reduction of the cost of merchandise sold. Volume allowances may be estimated based on historical purchases and estimates of projected purchases. Operating Leases and Deferred Rent The Company has various operating lease commitments on its store locations. Certain leases contain rent escalation clauses that require higher rental payments in later years. Leases may also contain rent holidays, or free rents, during the lease term. Rent expense is recognized on a straight-line basis over the lease term. Rent expense in excess of rental payments is recorded as deferred rent on the accompanying consolidated balance sheets. Tenant Allowances The Company enters into various types of lease agreements in the operation of its stores, including remodel and build-to-suit arrangements. Under any type of lease agreement, the Company may receive reimbursement from a landlord for some of the costs related to occupancy or tenant improvements per lease provisions. These reimbursements may be referred to as tenant allowances or landlord reimbursements. Reimbursement from a landlord for occupancy or tenant improvements is treated differently depending on the type of arrangement. Under most of the Company’s lease agreements, tenant allowances are included within deferred rent on the accompanying consolidated balance sheets. The deferred rent credit is amortized as rent expense on a straight-line basis over the term of the lease. Landlord reimbursements from these transactions are included in cash flows from operating activities as a change in deferred rent. In lease agreements where the Company is the deemed owner of the building during the construction period, a deemed sale-leaseback of the building occurs when construction is complete and the lease term begins. Under these lease agreements, as the tenant allowances are received, the value of the Company’s construction-in-progress or leasehold improvements is reduced accordingly. The proceeds from deemed sale-leaseback transactions are included in cash flows from investing activities. Health Insurance The Company maintains for its employees a partially self-funded health insurance plan. The Company maintains stop-loss insurance through an insurance company with a $100 per person deductible and aggregate claims limit above a predetermined threshold. The Company intends to maintain this plan indefinitely. However, the plan may be terminated, modified, suspended, or discontinued at any time for any reason specified by the Company. The Company has established reserve amounts based upon claims history and estimates of claims that have been incurred but not reported (“IBNR”) for this plan. As of February 3, 2018, and January 28, 2017, the Company estimated the IBNR for this plan to be $922 and $1,001, respectively. Actual claims may differ from the estimate and such difference could be significant. These reserves are included in accrued expenses in the accompanying consolidated balance sheets. Workers Compensation Insurance The Company maintains for its employees a high-deductible workers compensation plan. The Company maintains stop-loss insurance through an insurance company with a $150 per claim deductible and aggregate claims limit above a predetermined threshold. The Company intends to maintain this plan indefinitely. However, the plan may be terminated, modified, suspended, or discontinued at any time for any reason specified by the Company. The Company has established reserve amounts based upon claims history and estimates of IBNR for this plan. As of February 3, 2018, and January 28, 2017, the Company estimated the IBNR for this plan to be $659 and $650, respectively, related to the workers compensation plan. Actual claims may differ from the estimate and such difference could be significant. These reserves are included in accrued expenses in the accompanying consolidated balance sheets. Advertising Costs for newspaper, television, radio, and other advertising are expensed in the period in which the advertising occurs. The Company participates in various advertising and marketing cooperative programs with its vendors, who, under these programs, reimburse the Company for certain costs incurred. Payments received under these cooperative programs are recorded as a decrease to expense in the period that the advertising occurred. For the fiscal years ended February 3, 2018, January 28, 2017 and January 30, 2016, net advertising expenses totaled $7,760, $7,513, and $6,634, respectively. These amounts are included in selling, general and administrative expenses in the accompanying consolidated statements of income. Stock-Based Compensation Compensation expense is estimated based on grant date fair value on a straight-line basis over the requisite service or offering period. Costs associated with awards are included in compensation expense as a component of selling, general, and administrative expenses. Income Taxes The Company recognizes a deferred income tax liability or deferred income tax asset for the future tax consequences attributable to differences between the financial statement basis of existing assets and liabilities and their respective tax basis. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided against deferred income tax assets when it is more likely than not that all or some portion of the deferred income tax assets will not be realized. The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the relevant tax authorities, based on the technical merits of the position. Interest and potential penalties are accrued related to unrecognized tax benefits in the provision for income taxes. Fair Value of Financial Instruments The carrying amounts of financial instruments except for long-term debt approximate fair value because of the general short-term nature of these instruments. The carrying amounts of long-term variable rate debt approximate fair value as the terms are consistent with market terms for similar debt instruments. The carrying amount of the Company’s financial instruments approximates fair value as of February 3, 2018 and January 28, 2017. Earnings Per Share Basic earnings per share is calculated by dividing net income by the weighted-average shares of common stock outstanding, reduced by shares repurchased and held in treasury, during the period. Diluted earnings per share represents basic earnings per share adjusted to include the potentially dilutive effect of outstanding share option awards, nonvested share awards and nonvested share unit awards. Comprehensive Income The Company has no components of income that would require classification as other comprehensive income for the fiscal years ended February 3, 2018, January 28, 2017 or January 30, 2016. Recent Accounting Pronouncements Revenue from Contracts with Customers In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09 “Revenue from Contracts with Customers” (Topic 606) (“ASU 2014-09”). ASU 2014-09 is a comprehensive new revenue recognition model requiring a company to recognize revenue to depict the transfer of goods or services to a customer at an amount reflecting the consideration it expects to receive in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14, “Deferral of the Effective Date” (“ASU 2015-14”). ASU 2015-14 simply formalized a one year deferral of the effective date of ASU 2014-09. In March 2016, the FASB issued ASU 2016-08 “Principal versus Agent Considerations – Reporting Revenue Gross versus Net”, amending the principal-versus-agent implementation guidance set forth in ASU 2014-09. In April 2016, the FASB issued ASU 2016-10 “Identifying Performance Obligations and Licensing”, which amends certain aspects of the guidance set forth in the FASB’s new revenue standard related to identifying performance obligations and licensing implementation. As a result of these four standards updates, the Company will apply the new revenue standard to annual and interim reporting periods beginning after December 15, 2017. In adopting these standard updates, companies may use either a full retrospective or a modified retrospective approach. Management evaluated the provisions of these standard updates and has determined that the Company will adopt this standard using a modified retrospective approach with the cumulative effect of adoption recorded at the date of initial application . Management expects the new standards to impact the timing of revenue recognition for gift card and loyalty program rewards breakage. Revenue related to the unredeemed portion of the Company’s gift cards and loyalty program rewards will be recognized over the expected redemption period, rather than waiting until the likelihood of redemption becomes remote or the rewards expire. This change is not expected to change the total amount of revenue recognized, but would accelerate the timing of when revenue is recognized. Management has completed its analysis over the acceleration of revenue relating to the gift card and loyalty program rewards breakage and determined the amount to be approximately $3.4 million that will be recorded as an addition to beginning retained earnings in the first quarter of 2018. Management does not anticipate significant changes to the timing and amounts of the Company’s core revenue streams compared to the current revenue recognition policy resulting from adoption of the new guidance; however, management anticipates significant changes related to footnote disclosures to the consolidated financial statements as a result of the adoption of the new guidance. Lease Accounting In February 2016, the FASB issued ASU 2016-02, “Leases” (“ASU 2016-02”). The standard amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. ASU 2016-02 will be effective beginning in the first quarter of 2019. Early adoption of ASU 2016-02 is permitted. The Company plans to adopt the standard during the first quarter of 2019. The new leases standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. Management is currently evaluating the impact of adopting ASU 2016-02 on the Company’s consolidated financial statements, including whether to elect the practical expedients outlined in the new standard. Currently all of the Company’s store and corporate locations are accounted for as operating leases, and therefore are not recorded on our balance sheet. The Company expect this adoption will result in a material increase in the assets and liabilities on the Company’s consolidated balance sheets. Once the Company adopts this new standard, it expects that, for the majority of its leases, the leases would include the amortization of the right-of-use asset and the recognition of interest expense based on the lessee’s incremental borrowing rate (or the rate implicit in the lease, if known) on the repayment of the lease obligation. Currently, management is still assessing the impact this will have on the Company’s consolidated statement of income. In preparation for the adoption of the guidance, the Company is implementing controls and system changes to enable the preparation of financial information. Recognition of Breakage for Certain Prepaid Stored-Value Products In March 2016, the FASB issued ASU 2016-04, “Recognition of Breakage for Certain Prepaid Stored-Value Products” (“ASU 2016-04”). ASU 2016-04 entitles a company to derecognize amounts related to expected breakage in proportion to the pattern of rights expected to be exercised by the product holder to the extent that it is probable a significant reversal of the recognized breakage amount will not subsequently occur. ASU 2016-04 is effective for reporting periods beginning after December 15, 2017 and is to be applied retrospectively. Early adoption is permitted. Management believes ASU 2016-02 will have no impact on the Company’s consolidated financial statements. Classification of Certain Cash Receipts and Cash Payments In August 2016, the FASB issued ASU 2016-15, “Classification of Certain Cash Receipts and Cash Payments” (“ASU 2016-15”). The update amends the guidance in Accounting Standard Codification 230, Statement of Cash Flows , and clarifies how entities should classify certain cash receipts and cash payments on the statement of cash flows with the objective of reducing the existing diversity in practices related to eight specific cash flow issues. The amendments in this update are effective for annual periods beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted. Management has determined this will have no impact on the Company’s consolidated financial statements. Intangible – Goodwill and Other In January 2017, the FASB issued ASU 2017-04, “Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment,” which requires an entity to no longer perform a hypothetical purchase price allocation to measure goodwill impairment. Instead, impairment will be measured using the difference between the carrying amount and the fair value of the reporting unit. The ASU is effective for annual and interim periods in fiscal years beginning after December 15, 2019. All entities may early adopt the standard for goodwill impairment tests with measurement dates after January 1, 2017. Management believes ASU 2017-04 will have no impact on the Company’s consolidated financial statements. Compensation – Stock Compensation In May 2017, the FASB issued ASU 2017-09, “Compensation – Stock Compensation (Topic 718),” which clarifies what constitutes a modification of a share-based payment award. This ASU is effective for all entities for annual and interim reporting periods in fiscal years beginning after December 15, 2017. Early adoption is permitted as of the beginning of an annual period for which financial statements (interim or annual) have not been issued or made available for issuance. Management believes ASU 2017-09 will have no impact on the Company’s consolidated financial statements. |
Secondary Offering
Secondary Offering | 12 Months Ended |
Feb. 03, 2018 | |
Equity [Abstract] | |
Secondary Offering | (3) Secondary Offering On April 18, 2016, 6,000 shares of common stock were sold in a secondary offering by Seidler Equity Partners III, L.P. On April 22, 2016, the underwriters of the secondary offering fully exercised the option granted at the time of the secondary offering to purchase an additional 900 shares of common stock at the secondary offering price of $11.25 per share, less underwriting discounts and commissions, which consisted solely of shares sold by affiliates of Seidler Equity Partners III, L.P. The Company received no proceeds from the secondary offering or full exercise of the option. Total expenses incurred related to the secondary offering and the exercise of the option were $143 and are recorded in selling, general, and administrative expenses in the accompanying Statements of Income. On September 30, 2015, 6,250 shares of common stock were sold in a secondary offering by certain existing shareholders, including affiliates of Seidler Equity Partners III, L.P. On October 26, 2015, the underwriters of the secondary offering partially exercised the option granted at the time of the secondary offering to purchase an additional 649 shares of common stock at the secondary offering price of $12.25 per share, less underwriting discounts and commissions, which consists solely of shares sold by affiliates of Seidler Equity Partners III, L.P. The Company received no proceeds from the secondary offering or partial exercise of the option. Total expenses incurred related to the secondary offering and the exercise of the option were $727 and are recorded in selling, general, and administrative expenses in the accompanying statements of income. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Feb. 03, 2018 | |
Property and Equipment. | |
Property and Equipment | (4) Property and Equipment Property and equipment as of February 3, 2018 and January 28, 2017 are as follows: February 3, January 28, 2018 2017 Furniture, fixtures, and equipment $ 65,437 $ 52,719 Leasehold improvements 84,345 61,986 Construction in progress 2,434 10,746 Total property and equipment, gross 152,216 125,451 Less accumulated depreciation and amortization (58,181) (42,342) Total property and equipment, net $ 94,035 $ 83,109 Depreciation expense was $15,864, $12,169, and $9,763, for the fiscal years ended February 3, 2018, January 28, 2017 and January 30, 2016, respectively. |
Definite Lived Intangible Asset
Definite Lived Intangible Asset | 12 Months Ended |
Feb. 03, 2018 | |
Definite Lived Intangible Asset | |
Definite Lived Intangible Assets | (5) Definite Lived Intangible Asset The following table summarizes the definite lived intangible assets: February 3, 2018 Amortization period Gross carrying amount Accumulated amortization Net carrying amount Amortizing intangible assets: Non-compete agreement 5 years $ 9,063 (8,787) 276 Total $ 9,063 (8,787) 276 January 28, 2017 Amortization period Gross carrying amount Accumulated amortization Net carrying amount Amortizing intangible assets: Non-compete agreement 5 years $ 9,063 (6,945) 2,118 Total $ 9,063 (6,945) 2,118 Amortization expense for definite lived intangible asset was $1,842, $1,805, and $1,806 for the fiscal years ended February 3, 2018, January 28, 2017 and January 30, 2016. Amortization expense for the next year is $276 in fiscal year 2018. |
Accrued Expenses and Other Liab
Accrued Expenses and Other Liabilities | 12 Months Ended |
Feb. 03, 2018 | |
Accrued Expenses and Other Liabilities | |
Accrued Expenses and Other Liabilities | (6) Accrued Expenses and Other Liabilities Accrued expenses and other liabilities consist of the following at February 3, 2018 and January 28, 2017: February 3, January 28, 2018 2017 Book overdraft $ 9,944 $ 5,355 Unearned revenue 22,874 18,019 Accrued payroll and related expenses 8,004 9,430 Sales and use tax payable 3,277 4,802 Accrued construction costs 605 3,138 Other 5,898 8,842 $ 50,602 $ 49,586 |
Revolving Line of Credit
Revolving Line of Credit | 12 Months Ended |
Feb. 03, 2018 | |
Revolving Line of Credit | |
Revolving Line of Credit | (7) Revolving Line of Credit The Company has a senior secured revolving credit facility (“Revolving Line of Credit”) with Wells Fargo Bank, National Association (“Wells Fargo”). On July 24, 2017, the Company amended the credit agreement increasing the amount available to borrow under the Company’s senior secured revolving credit facility by $15.0 million to $150.0 million, subject to a borrowing base calculation. Each of the subsidiaries of the Company is a borrower under the revolving credit facility, and all obligations under the revolving credit facility are guaranteed by the Company. All of the Company’s obligations under the revolving credit facility are secured by a lien on substantially all of the Company’s tangible and intangible assets and the tangible and intangible assets of all of the Company’s subsidiaries, including a pledge of all capital stock of each of the Company’s subsidiaries. The lien securing the obligations under the revolving credit facility is a first priority lien as to certain liquid assets, including cash, accounts receivable, deposit accounts and inventory. In addition, the credit agreement contains provisions that enable Wells Fargo to require the Company to maintain a lock-box for the collection of all receipts. As of February 3, 2018, and January 28, 2017, the Company had $66,621 and $67,110, respectively, in outstanding revolving loans under the Revolving Line of Credit. Amounts outstanding are offset on the consolidated balance sheets by amounts in depository accounts under lock-box arrangements, which were $6,629 and $6,138 as of February 3, 2018 and January 28, 2017, respectively. As of February 3, 2018, the Company had stand-by commercial letters of credit of $1,505 under the terms of the Revolving Line of Credit. Borrowings under the Revolving Line of Credit bear interest based on either, at the Company’s option, the base rate or LIBOR, in each case plus an applicable margin. The base rate is the higher of (1) Wells Fargo’s prime rate, (2) the federal funds rate (as defined in the credit agreement) plus 0.50% and (3) the one-month LIBOR (as defined in the credit agreement) plus 1.00%. The applicable margin for loans under the Revolving Line of Credit, which varies based on the average daily availability, ranges from 0.25% to .75% per year for base rate loans and from 1.25% to 1.75% per year for LIBOR loans. The weighted average interest rate on the amount outstanding under the Revolving Line of Credit as of February 3, 2018 was 3.26%. The Company may be required to make mandatory prepayments under the Revolving Line of Credit in the event of a disposition of certain property or assets, in the event of receipt of certain insurance or condemnation proceeds, upon the issuance of certain debt or equity securities, upon the incurrence of certain indebtedness for borrowed money or upon the receipt of certain payments not received in the ordinary course of business. The Revolving Line of Credit contains customary affirmative and negative covenants, including covenants that limit the Company’s ability to incur, create or assume certain indebtedness, to create, incur or assume certain liens, to make certain investments, to make sales, transfers and dispositions of certain property and to undergo certain fundamental changes, including certain mergers, liquidations and consolidations. The Revolving Line of Credit also requires the Company to maintain a minimum availability at all times of not less than 10% of the gross borrowing base, and in any event, not less than $5,000. The Revolving Line of Credit also contains customary events of default. The Revolving Line of Credit matures on the earlier to occur of (x) the date that is 90 days prior to the maturity date of our senior secured term loan, which maturity date is currently December 3, 2020, unless the term loan has been repaid to the extent permitted under the credit agreement governing the Revolving Line of Credit or the term loan maturity has been extended to October 23, 2022 or later and (y) July 24, 2022 . As of February 3, 2018, and January 28, 2017, the Revolving Line of Credit had $393 and $419, respectively in outstanding deferred financing fees. During the 53 weeks ended February 3, 2018, the Company recognized $131 of non-cash interest expense with respect to the amortization of deferred financing fees. During the 52 weeks ended January 28, 2017, the Company recognized $161 of non-cash interest expense with respect to the amortization of deferred financing fees. |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Feb. 03, 2018 | |
Long-Term Debt | |
Long-Term Debt | (8) Long-Term Debt Long-term debt consisted of the following as of February 3, 2018 and January 28, 2017: February 3, January 28, 2018 2017 Term loan $ 135,127 $ 136,727 Less discount (678) (877) Less debt issuance costs (1,110) (1,146) 133,339 134,704 Less current portion, net of discount and debt issuance costs (990) (983) Long-term portion $ 132,349 $ 133,721 Term Loan The Company has a $160,000 senior secured term loan facility (“Term Loan”) with a financial institution. The Term Loan was issued at a price of 99% of the aggregate principal amount and has a maturity date of December 3, 2020. On May 18, 2017, Sportsman’s Warehouse, Inc. entered into an amendment to its Term Loan. The amendment increased the maximum leverage ratio in each of the remaining quarters by amounts ranging from 0.2x to 1.3x, with an average quarterly increase of 0.75x. As a result of the amendment, the interest rate on the Company’s Term Loan increased 25 basis points to LIBOR plus 6.25% with a 1.25% LIBOR floor. The Company incurred $341 in fees associated with the amendment to its Term Loan which were recorded as debt issuance costs on the consolidated balance sheet. The Term Loan bears interest at a rate per annum equal to the one-, two-, three-, or six-month LIBOR (or, the nine- or 12-month LIBOR), as defined in the term loan agreement, at the Company’s election, which cannot be less than 1.25%, plus an applicable margin of 6.25%. During 2017, LIBOR exceeded the floor rate of 1.25%. At February 3, 2018, the rate of the Company’s borrowings under our term loan was 7.63%. All of Sportsman’s Warehouse, Inc.’s obligations under the Term Loan are guaranteed by Holdings, Minnesota Merchandising Corporation, a wholly owned subsidiary of Holdings, and each of Sportsman’s Warehouse, Inc.’s subsidiaries. The Term Loan is secured by a lien on substantially all of the Company’s tangible and intangible assets. The lien securing the obligations under the Term Loan is a first priority lien as to certain non-liquid assets, including equipment, intellectual property, proceeds of assets sales and other personal property. The Term Loan requires quarterly principal payments of $400 payable on the last business day of each fiscal quarter up to and including October 30, 2020. A final installment payment consisting of the remaining unpaid balance is due on December 3, 2020. Sportsman’s Warehouse, Inc. may be required to make mandatory prepayments on the Term Loan in the event of, among other things, certain asset sales, the receipt of payment in respect of certain insurance claims or the issuance or incurrence of certain indebtedness. Sportsman’s Warehouse, Inc. may also be required to make mandatory prepayments based on any excess cash flows as defined in the agreement for the Term Loan. Due to the Company not having excess cash flow as of February 3, 2018, no mandatory prepayment will be required to be made during the fiscal year 2018. The Term Loan contains customary affirmative and negative covenants, including covenants that limit the Company’s ability to incur, create or assume certain indebtedness, to incur or assume certain liens, to purchase, hold or acquire certain investments, to declare or make certain dividends and distributions and to engage in certain mergers, consolidations and asset sales. The Term Loan also requires the Company to comply with specified financial covenants, including a minimum interest coverage ratio on a trailing twelve month basis and a maximum total net leverage ratio. The Term Loan also contains customary events of default. As of February 3, 2018, the Company was in compliance with all of the covenants of the Term Loan. As of February 3, 2018, the Term Loan had $133,339 outstanding, net of an unamortized discount of $678 and debt issuance costs of $1,110. During fiscal year 2017, Company recognized $199 of non-cash interest expense with respect to the amortization of this discount. During fiscal year 2016, the Company recognized $411 of non-cash interest expense with respect to the amortization of the discount on the Term Loan. Restricted Net Assets The provisions of the Term Loan and the Revolving Line of Credit restrict all of the net assets of the Company’s consolidated subsidiaries, which constitute all of the net assets on the Company’s consolidated balance sheet as of February 3, 2018, from being used to pay any dividends without prior written consent from the financial institutions party to the Company’s Term Loan and Revolving Line of Credit. |
Sale Leaseback Transactions
Sale Leaseback Transactions | 12 Months Ended |
Feb. 03, 2018 | |
Sale Leaseback Transactions | |
Sale Leaseback Transactions | (9) Sale Leaseback Transactions During the fiscal years ended February 3, 2018, January 28, 2017, and January 30, 2016 the Company completed deemed sale-leaseback transactions of the land and buildings associated with 4, 4, and 2 store locations, respectively. In each of the related lease agreements for these store locations, the Company was required to pay all construction costs directly with the right of reimbursement up to a pre-determined tenant allowance. Also, the Company indemnified the landlords with respect to costs arising from third-party damage arising from the acts or omission of employees, sub-lessees, assignees, agent, and/or contractors arising during construction. As a result, and, based on appropriate accounting guidance, the Company was deemed the owner of the land and building during the construction period. The deemed sale occurred when the construction of the assets was complete and the lease terms began. At the time of sale, any assets, up to the value of each pre-determined tenant allowance, were written off the Company’s books, and any remaining amounts were considered leasehold improvements. The total value of tenant allowances received under these transactions during fiscal year 2017, 2016, and 2015 was $9,022, $11,923, and $5,652 respectively. |
Common Stock
Common Stock | 12 Months Ended |
Feb. 03, 2018 | |
Equity [Abstract] | |
Common Stock | (10) Common Stock Holders of common stock are entitled to one vote per share, and to receive dividends and, upon liquidation or dissolution, are entitled to receive all assets available for distribution to stockholders on a proportional basis with the restricted nonvoting common stockholders. The holders have no preemptive or other subscription rights, and there are no redemption or sinking fund provisions with respect to such shares. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Feb. 03, 2018 | |
Earnings Per Share | |
Earnings Per Share | (11) Earnings Per Share Basic earnings per share is calculated by dividing net income by the weighted-average number of shares of common stock outstanding, reduced by the number of shares repurchased and held in treasury, during the period. Diluted earnings per share represents basic earnings per share adjusted to include the potentially dilutive effect of outstanding share option awards, nonvested share awards and nonvested share unit awards. The following table sets forth the computation of basic and diluted earnings per common share: Fiscal Year Ended February 3, January 28, January 30, 2018 2017 2016 Net income $ 17,742 $ 29,669 $ 27,771 Weighted-average shares of common stock outstanding: Basic 42,496 42,187 41,966 Dilutive effect of common stock equivalents 26 298 368 Diluted 42,522 42,485 42,334 Basic earnings per share $ 0.42 $ 0.70 $ 0.66 Diluted earnings per share $ 0.42 $ 0.70 $ 0.66 Restricted stock units considered anti-dilutive and excluded in the calculation 191 - - |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Feb. 03, 2018 | |
Stock-Based Compensation | |
Stock-Based Compensation | (12) Stock-Based Compensation Stock-Based Compensation T he Company recognized total stock-based compensation expense, including expense relating to the employee stock purchase plan, of $2,294, $3,186, and $2,257, during fiscal years 2017, 2016, and 2015, respectively. Compensation expense related to the Company's stock-based payment awards is recognized in selling, general, and administrative expenses in the consolidated statements of income. As of February 3, 2018, and January 28, 2017, respectively, the Company had $3,963 and $4,874 remaining in unrecognized compensation costs, respectively. Employee Stock Plans As of February 3, 2018, the number of shares available for awards under the 2013 Performance Incentive Plan (the “2013 Plan”) was 1,392. As of February 3, 2018, there were 579 awards outstanding under the 2013 Plan. All shares granted during the current year were newly issued shares. All subsequent awards were, and all future awards are expected to be, granted under the 2013 Plan. Nonvested Restricted Stock Awards During the fiscal year 2017, the Company did not issue any nonvested restricted stock awards to employees. During the fiscal year 2016, the Company issued 162 nonvested restricted stock awards to employees at a weighted average grant date fair value of $11.25 per share. The nonvested stock awards issued to employees vest over three years, with one third vesting on each grant date anniversary. The following table sets forth the rollforward of outstanding nonvested stock awards (per share amounts are not in thousands): Weighted average grant-date Shares fair value Balance at January 28, 2017 162 $ 11.25 Grants — — Forfeitures — — Vested 54 11.25 Balance at February 3, 2018 108 $ 11.25 Weighted average grant-date Shares fair value Balance at January 30, 2016 — — Grants 162 11.25 Forfeitures — — Vested — — Balance at January 28, 2017 162 $ 11.25 Nonvested Performance-Based Stock Awards During fiscal year 2017 the Company did not issue any nonvested performance-based stock awards to employees. During fiscal year 2016, the Company issued 159 nonvested performance-based stock awards to employees at a weighted average grant date fair value of $11.25 per share. The nonvested performance-based stock awards issued to employees vest over three years with one third vesting on each grant date anniversary. The number of shares issued is contingent on management achieving a fiscal year 2016 performance target for same store sales and return on invested capital for new stores. Based on the performance conditions met for 2016, the finalized granted awards was 73 as presented in the table below. The following table sets forth the rollforward of outstanding nonvested performance-based stock awards (per share amounts are not in thousands): Weighted average grant-date Shares fair value Balance at January 28, 2017 73 $ 11.25 Grants — — Forfeitures — — Vested 24 11.25 Balance at February 3, 2018 49 $ 11.25 Weighted average grant-date Shares fair value Balance at January 30, 2016 — — Grants 73 11.25 Forfeitures — — Vested — — Balance at January 28, 2017 73 $ 11.25 Nonvested Stock Unit Awards During the fiscal year 2017, the Company issued 397 nonvested stock units to employees of the Company at a weighted average grant date fair value of $5.15 per share. During the fiscal year 2017, the Company issued 59 nonvested stock units to independent members of the Board of Directors at a weighted average grant date fair value of $4.73. The shares issued to the independent members of the Board of Directors vest over 12 months with one twelfth vesting each month from the grant date. The shares issued to employees of the Company vest over a three year period with one third of the shares vesting on each grant date anniversary. During fiscal year 2016, the Company issued 29 nonvested stock units to independent members of the Board of Directors at a weighted average grant date fair value of $9.81 per share. These nonvested stock units vest over 12 months with one twelfth vesting each month from the grant date. The Company had no net share settlements in fiscal year 2017 or 2016. The following table sets forth the rollforward of outstanding nonvested stock units: Weighted average grant-date Shares fair value Balance at January 28, 2017 301 $ 7.17 Grants 456 5.09 Forfeitures 1 7.06 Vested 337 6.87 Balance at February 3, 2018 419 $ 5.15 Weighted average grant-date Shares fair value Balance at January 30, 2016 599 $ 7.15 Grants 29 9.81 Forfeitures 6 7.05 Vested 321 7.37 Balance at January 28, 2017 301 $ 7.17 As of February 3, 2018, and January 28, 2017, the weighted average grant date fair value of the outstanding shares were $5.15 and $7.17, respectively. |
Employee Stock Purchase Plan
Employee Stock Purchase Plan | 12 Months Ended |
Feb. 03, 2018 | |
Stock-Based Compensation | |
Employee Stock Purchase Plan | (13) Employee Stock Purchase Plan In June 2015, the Company’s stockholders approved the Sportsman’s Warehouse Holdings, Inc. Employee Stock Purchase Plan (“ESPP”), which provides for the granting of up to 800 shares of the Company’s common stock to eligible employees. The ESPP period is semi-annual and allows participants to purchase the Company’s stock at 85% of the lower of (i) the market value per share of the common stock on the first day of the offering period or (ii) the market value per share of the common stock on the purchase date. The first plan period began on January 1, 2016. Stock-based compensation expense related to the ESPP in fiscal year 2017 was $160 and 2016 was $165. The Company uses the Black-Scholes model to estimate the fair value of shares to be issued as of the grant date using the following weighted average assumptions: Fiscal Year Ended Fiscal Year Ended February 3, 2018 January 28, 2017 Risk-free interest rate Expected life (in years) 0.5 0.5 Expected volatility Dividend yield — — |
Income Taxes
Income Taxes | 12 Months Ended |
Feb. 03, 2018 | |
Income Taxes | |
Income Taxes | (14) Income Taxes For the fiscal years ended February 3, 2018, January 28, 2017 and January 30, 2016, the income tax provision consisted of the following: February 3, January 28, January 30, 2018 2017 2016 Current: Federal $ 12,718 $ 14,919 $ 12,341 State 1,868 2,530 1,982 Total current 14,586 17,449 14,323 Deferred: Federal 780 164 2,746 State (278) 3 316 Total deferred 502 167 3,062 Total income tax provision $ 15,088 $ 17,616 $ 17,385 The provision for income taxes differs from the amounts computed by applying the federal statutory rate as follows for the following periods: February 3, January 28, January 30, 2018 2017 2016 Federal statutory rate 33.7 % 35 % 35 % State tax, net of federal benefit 3.8 3.6 3.5 Permanent items 2.0 (0.4) 0.2 Other items (0.2) (0.9) Tax reform adjustment 6.7 — — Effective income tax rate 46.0 % 37.3 % 38.5 % The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at February 3, 2018 and January 31, 2017, respectively, are presented below: February 3, January 28, 2018 2017 Deferred tax assets: Accrued liabilities $ 369 $ 517 Deferred rent 11,703 14,833 Intangible asset 1,456 1,756 Inventories 1,906 2,757 Sales return reserve 175 372 Capital loss carryforward 41 63 Stock-based compensation 304 939 Loyalty program 1,374 — Total gross deferred tax assets $ 17,328 $ 21,237 Deferred tax liabilities: Depreciation $ (11,999) $ (15,468) Prepaid expenses (603) (672) Gift card escheatment (131) — Total gross deferred tax liabilities $ (12,733) $ (16,140) Net deferred tax asset $ 4,595 $ 5,097 On December 22, 2017 the U.S. Government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act made broad and complex changes to existing U.S. tax laws that impact the Company. Most notably, the Tax Act reduced the U.S. Federal corporate tax rate from 35 percent to 21 percent effective January 1, 2018. The Tax Act also provides for the acceleration of depreciation for certain assets placed in service after September 27, 2017. The Tax Act also established prospective changes beginning in 2018 including the limitations on the deductibility of certain executive compensation and interest expense. The Company does not expect these limitations to have a significant impact on our consolidated financial statements. The Company recognized the income tax effects of the Tax Act in its 2017 financial statements in accordance with SEC Staff Accounting Bulletin No. 118 (“SAB 118”), which provides guidance for the application of ASC 740, Income Taxes, in the reporting period in which the Tax Act was signed into law. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Act enactment date for companies to complete the accounting under ASC 740. In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the Tax Act for which the accounting under ASC 740 is complete. To the extent a company’s accounting for certain income tax effects of the Tax Act is incomplete but it is able to determine a reasonable estimate, it must record a provisional estimate in the financial statements. Pursuant to SAB 118, the Company is allowed a measurement period of up to one year after the enactment date of the Tax Act to finalize the recording of the related tax impacts. However, the Company does not have any provisional estimates associated with the Tax Act and has recorded a tax expense related to the net change in deferred tax assets of $2,600 for 2017. As a result of the Tax Act, the Company has recorded a discrete net tax expense of $2,153 in the period ending February 3, 2018. The primary components of this tax expense include $2,600 for the revaluation of U.S deferred tax assets and liabilities at the new corporate tax rate of 21 percent, offset by a tax benefit of $447 due to the reduction in effective rate based on the time of enactment of the tax law and our fiscal year-end. Deferred tax assets have resulted primarily from the Company’s future deductible temporary differences. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax asset will not be realized. The Company’s ability to realize its deferred tax assets depends upon the generation of sufficient future taxable income as well as the ability to use historical taxable income to allow for the utilization of its deductible temporary differences. Management evaluates the realizability of the deferred tax assets and the need for additional valuation allowances quarterly. At February 3, 2018, based on current facts and circumstances, management believes that it is more likely than not that the Company will realize benefit for its deferred tax assets. As of February 3, 2018, the Company had no unrecognized tax benefits. The Company does not anticipate that unrecognized tax benefits will significantly increase or decrease within 12 months of the reporting date. Federal and state tax years that remain subject to examination are periods ended February 2, 2013 through January 28, 2017. The Company’s policy is to accrue interest expense, and penalties as appropriate, on estimated unrecognized tax benefits as a charge to interest expense in the consolidated statements of income. During fiscal year 2017, the Company accrued interest and penalties of $95. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Feb. 03, 2018 | |
Commitments and Contingencies. | |
Commitments and Contingencies | (15) Commitments and Contingencies Operating Leases The Company leases its retail store, office space, and warehouse locations under non-cancelable operating leases. Certain of these leases include tenant allowances that are amortized over the life of the lease. In 2017, 2016 and 2015, the Company received tenant allowances of $10,696, $16,718, and $5,652, respectively. The Company expects to receive $6,112 in tenant allowances under leases during fiscal year 2018. Certain leases require the Company to pay contingent rental amounts based on a percentage of sales, in addition to real estate taxes, insurance, maintenance and other operating expenses associated with the leased premises. These agreements expire at various dates through July 2030 and generally contain three, five-year renewal options. Rent expense under these leases totaled $49,860, $37,132, and $33,209, for the fiscal years ended February 3, 2018, January 28, 2017 and January 30, 2016, respectively. Future minimum lease payments for non-cancelable operating leases by fiscal year, as of February 3, 2018 are as follows: Fiscal Year: 2018 45,128 2019 43,531 2020 42,883 2021 38,759 2022 34,455 Thereafter 98,730 $ 303,486 Legal Matters The Company is involved in various legal matters generally incidental to its business. After discussion with legal counsel, management is not aware of any matters for which the likelihood of a loss is probable and reasonably estimable and which could have a material impact on its consolidated financial condition, liquidity, or results of operations. On March 12, 2014, the Company was added as a defendant to a pending consolidated action filed in the United States District Court, Western District of Washington, captioned as Lacey Market Place Associates II, LLC, et al. v. United Farmers of Alberta Co-Operative Limited, et al., Case No. 2:13-cv-00383-JLR against United Farmers of Alberta Co-Operative Limited (the seller of Wholesale Sports), Wholesale Sports, Alamo Group, LLC and Donald F. Gaube and spouse. The amended complaint was filed by the landlords of two stores that the Company did not assume in the Company’s purchase of assets from Wholesale Sports. Such stores were formerly operated by Wholesale Sports in Skagit and Thurston Counties in Washington. The amended complaint alleged breach of lease, breach of collateral assignment, misrepresentation, intentional interference with contract, piercing the corporate veil and violation of Washington’s Fraudulent Transfer Act. The Company was named as a co-defendant with respect to the intentional interference with contract and fraudulent conveyance claims. The amended complaint sought against the Company and all defendants unspecified money damages, declaratory relief and attorneys’ fees and costs. On January 28, 2015, the court in the Lacey Marketplace action granted in part and denied in part the Company’s motion for summary judgment and dismissed the intentional interference claim against the Company, but declined to dismiss the fraudulent transfer claim. Trial in the Lacey Marketplace action began March 2, 2015 and concluded March 6, 2015. On March 9, 2015, the jury in the trial assessed $11,887 against the defendants to the action, including the Company. The Company reviewed the decision and accrued $4,000 in its results for the fiscal year ended January 31, 2015 related to this matter. The Company strongly disagreed with the jury’s verdict and filed post-trial motions seeking to have the verdict set aside. On July 30, 2015, the court granted the Company’s motion for judgment as a matter of law. Based on the court’s most recent judgment in favor of the Company on July 30, 2015, the Company determined that the likelihood of loss in this case is not probable, and, as such, the Company reversed the previous accrual of $4,000 in its results for the fiscal year ended January 30, 2016. Both United Farmers of Alberta Co-Operative Limited, a co-defendant, and the plaintiff have appealed the court’s summary judgment ruling against the tortious interference claim, and the July 30, 2015 ruling setting aside the jury verdict, to the appellate court. The oral argument for the appeal was conducted on December 5, 2017 and on December 21, 2017 the appeals court ruled there to be no judgment against Sportsman’s Warehouse. |
Related-Party Transactions
Related-Party Transactions | 12 Months Ended |
Feb. 03, 2018 | |
Related-Party Transactions | |
Related Party Transactions | (16) Related-Party Transactions On August 14, 2009, the Company entered into a reimbursement agreement with Seidler Equity Partners III, L.P. Under the terms of this agreement, the Company agreed to reimburse Seidler Equity Partners III, L.P. for various out-of-pocket costs and expenses related to the Company up to a maximum of $150 annually. During the fiscal years ended February 3, 2018, January 28, 2017, and January 30, 2016, the Company made payments of $5, $2, and $12, respectively, under this agreement. At February 3, 2018 and January 28, 2017, there were no amounts payable under the terms of this agreement. |
Retirement Plan
Retirement Plan | 12 Months Ended |
Feb. 03, 2018 | |
Retirement Plan | |
Retirement Plan | (17) Retirement Plan The Company sponsors a profit sharing plan (the “Plan”) for which Company contributions are based upon wages paid. As approved by the Board of Directors, the Company makes discretionary contributions to the Plan at rates determined by management. The Company made contributions of $390, $351, and $282, for the fiscal years ended February 3, 2018, January 28, 2017, and January 30, 2016, respectively. |
Subsequent Event
Subsequent Event | 12 Months Ended |
Feb. 03, 2018 | |
Subsequent Event | |
Subsequent Event | (18) Subsequent Event On March 13, 2018 Mr. John Schaefer, the Chief Executive Officer of Sportsman’s Warehouse Holdings, Inc. (the “Company”) notified the Board of Directors (the “Board”) of his retirement as Chief Executive Officer and as a Class III member of the board, and the Company entered into a retirement agreement with Mr. Schaefer effective immediately. In conjunction with the agreement, the Company will pay an aggregate amount of $1,459 subject to tax withholdings and other authorized deductions, in accordance with the Company’s regular payroll practice over eighteen (18) months following the effective date of the agreement. Also, as of the effective date of the agreement, all unvested restricted shares, unvested performance restricted shares, and unvested restricted stock units became fully vested and any restrictions lapsed. The total number of unvested shares as of the effective date of the agreement that were subject to accelerated vesting was 242 shares. In connection with the retirement of Mr. Schaefer, on March 13, 2018, the Board appointed Mr. Barker, the Company’s President and Chief Operating Officer, as Chief Executive Officer, with such appointment to be effective immediately upon Mr. Schaefer’s retirement. Also, on March 13, 2018, the Board appointed Mr. Barker to serve as a Class III member of the Board, to serve until the Company’s 2020 annual meeting of stockholders and until his successor is elected and qualified. |
Summary of Significant Accoun25
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Feb. 03, 2018 | |
Summary of Significant Accounting Policies | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and include the accounts of its four wholly owned subsidiaries, Sportsman’s Warehouse, Inc. (“Sportsman’s Warehouse”), Pacific Flyway Wholesale, LLC (“Pacific Flyway”), Sportsman’s Warehouse Southwest, Inc., and Minnesota Merchandising Corporation. All intercompany transactions and accounts have been eliminated in consolidation. |
Fiscal Period | Fiscal Year The Company operates using a 52/53 week fiscal year ending on the Saturday closest to January 31. Fiscal year 2017 ended February 3, 2018 and contained 53 weeks of operation. Fiscal years 2016 and 2015 ended January 28, 2017, and January 30, 2016, respectively and each contained 52 weeks of operations. |
Seasonality | Seasonality The Company’s business is generally seasonal, with a significant portion of total sales occurring during the third and fourth quarters of the fiscal year. |
Use of Estimates in the Preparation of Consolidated Financial Statements | Use of Estimates in the Preparation of Consolidated Financial Statements The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Segment Reporting | Segment Reporting The Company operates solely as a sporting goods retailer whose Chief Operating Decision Maker (“CODM”) is the Chief Executive Officer. The CODM reviews financial information presented on a consolidated and individual store and cost center basis, for purposes of allocating resources and evaluating financial performance. The Company’s stores typically have similar square footage and offer essentially the same general product mix. The Company’s core customer demographic remains similar chainwide, as does the Company’s process for the procurement and marketing of its product mix. Furthermore, the Company distributes its product mix chainwide from a single distribution center. Given that the stores have the same economic characteristics, the individual stores are aggregated into one single operating and reportable segment. |
Cash | Cash The Company considers cash on hand in stores and highly liquid investments with an initial maturity of three months or less as cash. Checks issued pending bank clearance that result in overdraft balances for accounting purposes are classified as accrued expenses in the accompanying consolidated balance sheets. In accordance with the terms of a financing agreement (Note 8), the Company maintains depository accounts with two banks in a lock-box arrangement. Deposits into these accounts are used to reduce the outstanding balance on the line of credit as soon as the respective bank allows the funds to be transferred to the financing company. At February 3, 2018 and January 28, 2017, the combined balance in these accounts were $6,629 and $6,138, respectively. Accordingly, these amounts have been classified as a reduction in the line of credit as if the transfers had occurred on February 3, 2018 and January 28, 2017, respectively. |
Accounts Receivable | Accounts Receivable The Company offers credit terms on the sale of products to certain government and corporate retail customers and requires no collateral from these customers. The Company performs ongoing credit evaluations of its customers’ financial condition and maintains an allowance for doubtful accounts receivable based upon historical experience and a specific review of accounts receivable at the end of each period. Actual bad debts may differ from these estimates and the difference could be significant. At February 3, 2018 and January 28, 2017, the Company had no allowance for doubtful accounts receivable. |
Merchandise Inventories | Merchandise Inventories The Company adopted Accounting Standards Updates (“ASU”) 2015-11 “Simplifying the Measurement of Inventory” in the first quarter of fiscal year 2017 and has measured its inventory at the lower of cost or net realizable value. This adoption had no impact on the value of inventory presented on the consolidated balance sheet for the fiscal year 2017. Cost is determined using the weighted average cost method. The Company estimates a provision for inventory shrinkage based on its historical inventory accuracy rates as determined by periodic cycle counts. The Company also adjusts inventory for obsolete, slow moving, or damaged inventory based on inventory activity thresholds and by specific identification of slow moving or obsolete inventory. The inventory reserves for shrinkage, damaged, or obsolescence totaled $7,139 and $6,539 at February 3, 2018 and January 28, 2017, respectively. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost. Leasehold improvements primarily include the cost of improvements funded by landlord incentives or allowances. Maintenance, repairs, minor renewals, and betterments are expensed as incurred. Major renewals and betterments are capitalized. Upon retirement or disposal of assets, the cost and accumulated depreciation and amortization are eliminated from the respective accounts and the related gains or losses are credited or charged to earnings. Depreciation and amortization of property and equipment is computed using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized over the shorter of the useful lives of the improvements or the term of the lease. Furniture, fixtures, and equipment, are depreciated over useful lives ranging from 3 to 10 years. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews its long-lived assets with definite lives for impairment whenever events or changes in circumstances may indicate that the carrying value of an asset may not be recoverable. The Company uses an estimate of the future undiscounted net cash flows of the related asset or group of assets over their remaining useful lives in measuring whether the assets are recoverable. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount exceeds the estimated fair value of the asset. Impairment of long-lived assets is assessed at the lowest levels for which there are identifiable cash flows that are independent of other groups of assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less the estimated costs to sell. No impairment charge to long-lived assets was recorded during the fiscal years ended February 3, 2018, January 28, 2017, or January 30, 2016. |
Prepaid Expenses and Other | Prepaid Expenses and Other Prepaid expenses and other primarily consists of prepaid expenses, vendor rebates receivable, vendor advertising receivables and miscellaneous deposits. |
Revenue Recognition | Revenue Recognition Revenue is recognized for retail sales at the time of the sale in the store. The Company records a reserve for estimated product returns in each reporting period, based on its historical experience. The Company’s reserve for estimated returns and discounts is recorded against retail sales on a net basis. The Company’s sales returns reserve was $697 and $964 at February 3, 2018, and January 28, 2017, respectively. Revenue for gift cards sold is deferred and recognized as the gift cards are redeemed for merchandise. Gift card breakage income is recognized based upon historical redemption patterns and represents the balance of gift cards for which the Company believes the likelihood of redemption by the customer is remote. During the fiscal years ended February 3, 2018, January 28, 2017, and January 30, 2016, the Company recognized $1,337, $347, and $846 of gift card breakage income, respectively. This income is included in the accompanying consolidated statements of income as a reduction in selling, general, and administrative expenses (“SG&A”). In November of 2013, the Company launched a customer loyalty program. Under this program, the Company issues credits in the form of points to loyalty program members. The value of points earned by loyalty program members is included in accrued liabilities and recorded as a reduction of net sales at the time the points are earned. Loyalty breakage income is recognized based upon the balance of loyalty points that have expired after a dormancy period of 18 months. During the fiscal year ended February 3, 2018, January 28, 2017, and January 30, 2016 the Company recognized $1,022, $611 and $232, respectively of loyalty breakage income. This income is included in the accompanying consolidated statements of income as an increase in net sales. Customer deposits on items placed in layaway are recorded as a liability. Revenue is recognized on layaway transactions at the point where the customer takes possession of the merchandise. These liabilities are recorded as unearned revenue in accrued expenses in the consolidated balance sheets. Sales taxes collected from customers and remitted to governmental authorities are accounted for on a net basis and, therefore, are excluded from net sales in the consolidated statements of income. |
Cost of Goods Sold | Cost of Goods Sold Cost of goods sold primarily consists of merchandise acquisition costs, including freight-in costs, shipping costs, terms discounts received from the vendor and vendor allowances and rebates associated directly with merchandise. Vendor allowances include allowances and rebates received from vendors. The Company records an estimate of earned allowances based on purchase volumes. These funds are determined for each fiscal year, and the majority is based on various quantitative contract terms. Amounts expected to be received from vendors relating to purchase of merchandise inventories are recognized as a reduction of cost of goods sold as the merchandise is sold. Historical program results and current purchase volumes are reviewed when establishing the estimate for earned allowances. |
Shipping and Handling Fees and Costs | Shipping and Handling Fees and Costs All shipping and handling fees billed to customers are recorded as a component of net sales. All costs incurred related to the shipping and handling of products are recorded in cost of sales. |
Vendor Allowances | Vendor Allowances Vendor allowances include price allowances, volume rebates, store opening costs reimbursements, marketing participation and advertising reimbursements received from vendors under the terms of specific arrangements with certain vendors. Vendor allowances related to merchandise are recognized as a reduction of the costs of merchandise as sold. Vendor reimbursements of costs are recorded as a reduction to expense in the period the related cost is incurred based on actual costs incurred. Any cost reimbursements exceeding expenses incurred are recognized as a reduction of the cost of merchandise sold. Volume allowances may be estimated based on historical purchases and estimates of projected purchases. |
Operating Leases and Deferred Rent | Operating Leases and Deferred Rent The Company has various operating lease commitments on its store locations. Certain leases contain rent escalation clauses that require higher rental payments in later years. Leases may also contain rent holidays, or free rents, during the lease term. Rent expense is recognized on a straight-line basis over the lease term. Rent expense in excess of rental payments is recorded as deferred rent on the accompanying consolidated balance sheets. |
Tenant Allowances | Tenant Allowances The Company enters into various types of lease agreements in the operation of its stores, including remodel and build-to-suit arrangements. Under any type of lease agreement, the Company may receive reimbursement from a landlord for some of the costs related to occupancy or tenant improvements per lease provisions. These reimbursements may be referred to as tenant allowances or landlord reimbursements. Reimbursement from a landlord for occupancy or tenant improvements is treated differently depending on the type of arrangement. Under most of the Company’s lease agreements, tenant allowances are included within deferred rent on the accompanying consolidated balance sheets. The deferred rent credit is amortized as rent expense on a straight-line basis over the term of the lease. Landlord reimbursements from these transactions are included in cash flows from operating activities as a change in deferred rent. In lease agreements where the Company is the deemed owner of the building during the construction period, a deemed sale-leaseback of the building occurs when construction is complete and the lease term begins. Under these lease agreements, as the tenant allowances are received, the value of the Company’s construction-in-progress or leasehold improvements is reduced accordingly. The proceeds from deemed sale-leaseback transactions are included in cash flows from investing activities. |
Health Insurance | Health Insurance The Company maintains for its employees a partially self-funded health insurance plan. The Company maintains stop-loss insurance through an insurance company with a $100 per person deductible and aggregate claims limit above a predetermined threshold. The Company intends to maintain this plan indefinitely. However, the plan may be terminated, modified, suspended, or discontinued at any time for any reason specified by the Company. The Company has established reserve amounts based upon claims history and estimates of claims that have been incurred but not reported (“IBNR”) for this plan. As of February 3, 2018, and January 28, 2017, the Company estimated the IBNR for this plan to be $922 and $1,001, respectively. Actual claims may differ from the estimate and such difference could be significant. These reserves are included in accrued expenses in the accompanying consolidated balance sheets. |
Workers Compensation Insurance | Workers Compensation Insurance The Company maintains for its employees a high-deductible workers compensation plan. The Company maintains stop-loss insurance through an insurance company with a $150 per claim deductible and aggregate claims limit above a predetermined threshold. The Company intends to maintain this plan indefinitely. However, the plan may be terminated, modified, suspended, or discontinued at any time for any reason specified by the Company. The Company has established reserve amounts based upon claims history and estimates of IBNR for this plan. As of February 3, 2018, and January 28, 2017, the Company estimated the IBNR for this plan to be $659 and $650, respectively, related to the workers compensation plan. Actual claims may differ from the estimate and such difference could be significant. These reserves are included in accrued expenses in the accompanying consolidated balance sheets. |
Advertising | Advertising Costs for newspaper, television, radio, and other advertising are expensed in the period in which the advertising occurs. The Company participates in various advertising and marketing cooperative programs with its vendors, who, under these programs, reimburse the Company for certain costs incurred. Payments received under these cooperative programs are recorded as a decrease to expense in the period that the advertising occurred. For the fiscal years ended February 3, 2018, January 28, 2017 and January 30, 2016, net advertising expenses totaled $7,760, $7,513, and $6,634, respectively. These amounts are included in selling, general and administrative expenses in the accompanying consolidated statements of income. |
Stock-Based Compensation | Stock-Based Compensation Compensation expense is estimated based on grant date fair value on a straight-line basis over the requisite service or offering period. Costs associated with awards are included in compensation expense as a component of selling, general, and administrative expenses. |
Income Taxes | Income Taxes The Company recognizes a deferred income tax liability or deferred income tax asset for the future tax consequences attributable to differences between the financial statement basis of existing assets and liabilities and their respective tax basis. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided against deferred income tax assets when it is more likely than not that all or some portion of the deferred income tax assets will not be realized. The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the relevant tax authorities, based on the technical merits of the position. Interest and potential penalties are accrued related to unrecognized tax benefits in the provision for income taxes. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of financial instruments except for long-term debt approximate fair value because of the general short-term nature of these instruments. The carrying amounts of long-term variable rate debt approximate fair value as the terms are consistent with market terms for similar debt instruments. The carrying amount of the Company’s financial instruments approximates fair value as of February 3, 2018 and January 28, 2017. |
Earnings Per Share | Earnings Per Share Basic earnings per share is calculated by dividing net income by the weighted-average shares of common stock outstanding, reduced by shares repurchased and held in treasury, during the period. Diluted earnings per share represents basic earnings per share adjusted to include the potentially dilutive effect of outstanding share option awards, nonvested share awards and nonvested share unit awards. |
Comprehensive Income | Comprehensive Income The Company has no components of income that would require classification as other comprehensive income for the fiscal years ended February 3, 2018, January 28, 2017 or January 30, 2016. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Revenue from Contracts with Customers In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09 “Revenue from Contracts with Customers” (Topic 606) (“ASU 2014-09”). ASU 2014-09 is a comprehensive new revenue recognition model requiring a company to recognize revenue to depict the transfer of goods or services to a customer at an amount reflecting the consideration it expects to receive in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14, “Deferral of the Effective Date” (“ASU 2015-14”). ASU 2015-14 simply formalized a one year deferral of the effective date of ASU 2014-09. In March 2016, the FASB issued ASU 2016-08 “Principal versus Agent Considerations – Reporting Revenue Gross versus Net”, amending the principal-versus-agent implementation guidance set forth in ASU 2014-09. In April 2016, the FASB issued ASU 2016-10 “Identifying Performance Obligations and Licensing”, which amends certain aspects of the guidance set forth in the FASB’s new revenue standard related to identifying performance obligations and licensing implementation. As a result of these four standards updates, the Company will apply the new revenue standard to annual and interim reporting periods beginning after December 15, 2017. In adopting these standard updates, companies may use either a full retrospective or a modified retrospective approach. Management evaluated the provisions of these standard updates and has determined that the Company will adopt this standard using a modified retrospective approach with the cumulative effect of adoption recorded at the date of initial application . Management expects the new standards to impact the timing of revenue recognition for gift card and loyalty program rewards breakage. Revenue related to the unredeemed portion of the Company’s gift cards and loyalty program rewards will be recognized over the expected redemption period, rather than waiting until the likelihood of redemption becomes remote or the rewards expire. This change is not expected to change the total amount of revenue recognized, but would accelerate the timing of when revenue is recognized. Management has completed its analysis over the acceleration of revenue relating to the gift card and loyalty program rewards breakage and determined the amount to be approximately $3.4 million that will be recorded as an addition to beginning retained earnings in the first quarter of 2018. Management does not anticipate significant changes to the timing and amounts of the Company’s core revenue streams compared to the current revenue recognition policy resulting from adoption of the new guidance; however, management anticipates significant changes related to footnote disclosures to the consolidated financial statements as a result of the adoption of the new guidance. Lease Accounting In February 2016, the FASB issued ASU 2016-02, “Leases” (“ASU 2016-02”). The standard amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. ASU 2016-02 will be effective beginning in the first quarter of 2019. Early adoption of ASU 2016-02 is permitted. The Company plans to adopt the standard during the first quarter of 2019. The new leases standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. Management is currently evaluating the impact of adopting ASU 2016-02 on the Company’s consolidated financial statements, including whether to elect the practical expedients outlined in the new standard. Currently all of the Company’s store and corporate locations are accounted for as operating leases, and therefore are not recorded on our balance sheet. The Company expect this adoption will result in a material increase in the assets and liabilities on the Company’s consolidated balance sheets. Once the Company adopts this new standard, it expects that, for the majority of its leases, the leases would include the amortization of the right-of-use asset and the recognition of interest expense based on the lessee’s incremental borrowing rate (or the rate implicit in the lease, if known) on the repayment of the lease obligation. Currently, management is still assessing the impact this will have on the Company’s consolidated statement of income. In preparation for the adoption of the guidance, the Company is implementing controls and system changes to enable the preparation of financial information. Recognition of Breakage for Certain Prepaid Stored-Value Products In March 2016, the FASB issued ASU 2016-04, “Recognition of Breakage for Certain Prepaid Stored-Value Products” (“ASU 2016-04”). ASU 2016-04 entitles a company to derecognize amounts related to expected breakage in proportion to the pattern of rights expected to be exercised by the product holder to the extent that it is probable a significant reversal of the recognized breakage amount will not subsequently occur. ASU 2016-04 is effective for reporting periods beginning after December 15, 2017 and is to be applied retrospectively. Early adoption is permitted. Management believes ASU 2016-02 will have no impact on the Company’s consolidated financial statements. Classification of Certain Cash Receipts and Cash Payments In August 2016, the FASB issued ASU 2016-15, “Classification of Certain Cash Receipts and Cash Payments” (“ASU 2016-15”). The update amends the guidance in Accounting Standard Codification 230, Statement of Cash Flows , and clarifies how entities should classify certain cash receipts and cash payments on the statement of cash flows with the objective of reducing the existing diversity in practices related to eight specific cash flow issues. The amendments in this update are effective for annual periods beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted. Management has determined this will have no impact on the Company’s consolidated financial statements. Intangible – Goodwill and Other In January 2017, the FASB issued ASU 2017-04, “Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment,” which requires an entity to no longer perform a hypothetical purchase price allocation to measure goodwill impairment. Instead, impairment will be measured using the difference between the carrying amount and the fair value of the reporting unit. The ASU is effective for annual and interim periods in fiscal years beginning after December 15, 2019. All entities may early adopt the standard for goodwill impairment tests with measurement dates after January 1, 2017. Management believes ASU 2017-04 will have no impact on the Company’s consolidated financial statements. Compensation – Stock Compensation In May 2017, the FASB issued ASU 2017-09, “Compensation – Stock Compensation (Topic 718),” which clarifies what constitutes a modification of a share-based payment award. This ASU is effective for all entities for annual and interim reporting periods in fiscal years beginning after December 15, 2017. Early adoption is permitted as of the beginning of an annual period for which financial statements (interim or annual) have not been issued or made available for issuance. Management believes ASU 2017-09 will have no impact on the Company’s consolidated financial statements. |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Feb. 03, 2018 | |
Property and Equipment. | |
Schedule of Property and Equipment | Property and equipment as of February 3, 2018 and January 28, 2017 are as follows: February 3, January 28, 2018 2017 Furniture, fixtures, and equipment $ 65,437 $ 52,719 Leasehold improvements 84,345 61,986 Construction in progress 2,434 10,746 Total property and equipment, gross 152,216 125,451 Less accumulated depreciation and amortization (58,181) (42,342) Total property and equipment, net $ 94,035 $ 83,109 |
Definite Lived Intangible Ass27
Definite Lived Intangible Asset (Tables) | 12 Months Ended |
Feb. 03, 2018 | |
Definite Lived Intangible Asset | |
Summary of Definite Lived Intangible Assets | February 3, 2018 Amortization period Gross carrying amount Accumulated amortization Net carrying amount Amortizing intangible assets: Non-compete agreement 5 years $ 9,063 (8,787) 276 Total $ 9,063 (8,787) 276 January 28, 2017 Amortization period Gross carrying amount Accumulated amortization Net carrying amount Amortizing intangible assets: Non-compete agreement 5 years $ 9,063 (6,945) 2,118 Total $ 9,063 (6,945) 2,118 |
Accrued Expenses and Other Li28
Accrued Expenses and Other Liabilities (Tables) | 12 Months Ended |
Feb. 03, 2018 | |
Accrued Expenses and Other Liabilities | |
Components Accrued Expenses | Accrued expenses and other liabilities consist of the following at February 3, 2018 and January 28, 2017: February 3, January 28, 2018 2017 Book overdraft $ 9,944 $ 5,355 Unearned revenue 22,874 18,019 Accrued payroll and related expenses 8,004 9,430 Sales and use tax payable 3,277 4,802 Accrued construction costs 605 3,138 Other 5,898 8,842 $ 50,602 $ 49,586 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Feb. 03, 2018 | |
Long-Term Debt | |
Summary of Long-Term Debt | Long-term debt consisted of the following as of February 3, 2018 and January 28, 2017: February 3, January 28, 2018 2017 Term loan $ 135,127 $ 136,727 Less discount (678) (877) Less debt issuance costs (1,110) (1,146) 133,339 134,704 Less current portion, net of discount and debt issuance costs (990) (983) Long-term portion $ 132,349 $ 133,721 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Feb. 03, 2018 | |
Earnings Per Share | |
Computation of Basic and Diluted Earnings Per Common Share | The following table sets forth the computation of basic and diluted earnings per common share: Fiscal Year Ended February 3, January 28, January 30, 2018 2017 2016 Net income $ 17,742 $ 29,669 $ 27,771 Weighted-average shares of common stock outstanding: Basic 42,496 42,187 41,966 Dilutive effect of common stock equivalents 26 298 368 Diluted 42,522 42,485 42,334 Basic earnings per share $ 0.42 $ 0.70 $ 0.66 Diluted earnings per share $ 0.42 $ 0.70 $ 0.66 Restricted stock units considered anti-dilutive and excluded in the calculation 191 - - |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Feb. 03, 2018 | |
Stock-Based Compensation | |
Rollforward of Outstanding Nonvested Stock Awards | The following table sets forth the rollforward of outstanding nonvested stock awards (per share amounts are not in thousands): Weighted average grant-date Shares fair value Balance at January 28, 2017 162 $ 11.25 Grants — — Forfeitures — — Vested 54 11.25 Balance at February 3, 2018 108 $ 11.25 Weighted average grant-date Shares fair value Balance at January 30, 2016 — — Grants 162 11.25 Forfeitures — — Vested — — Balance at January 28, 2017 162 $ 11.25 |
Rollforward of Outstanding Nonvested Performance-based Stock Awards | The following table sets forth the rollforward of outstanding nonvested performance-based stock awards (per share amounts are not in thousands): Weighted average grant-date Shares fair value Balance at January 28, 2017 73 $ 11.25 Grants — — Forfeitures — — Vested 24 11.25 Balance at February 3, 2018 49 $ 11.25 Weighted average grant-date Shares fair value Balance at January 30, 2016 — — Grants 73 11.25 Forfeitures — — Vested — — Balance at January 28, 2017 73 $ 11.25 |
Rollforward of Outstanding Nonvested Stock Units | Weighted average grant-date Shares fair value Balance at January 28, 2017 301 $ 7.17 Grants 456 5.09 Forfeitures 1 7.06 Vested 337 6.87 Balance at February 3, 2018 419 $ 5.15 Weighted average grant-date Shares fair value Balance at January 30, 2016 599 $ 7.15 Grants 29 9.81 Forfeitures 6 7.05 Vested 321 7.37 Balance at January 28, 2017 301 $ 7.17 |
Employee Stock Purchase Plan (T
Employee Stock Purchase Plan (Tables) | 12 Months Ended |
Feb. 03, 2018 | |
Stock-Based Compensation | |
Schedule of Weighted Average Assumptions Used to Estimate Fair Value of Shares to be Issued | Fiscal Year Ended Fiscal Year Ended February 3, 2018 January 28, 2017 Risk-free interest rate Expected life (in years) 0.5 0.5 Expected volatility Dividend yield — — |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Feb. 03, 2018 | |
Income Taxes | |
Provision for Income Taxes | For the fiscal years ended February 3, 2018, January 28, 2017 and January 30, 2016, the income tax provision consisted of the following: February 3, January 28, January 30, 2018 2017 2016 Current: Federal $ 12,718 $ 14,919 $ 12,341 State 1,868 2,530 1,982 Total current 14,586 17,449 14,323 Deferred: Federal 780 164 2,746 State (278) 3 316 Total deferred 502 167 3,062 Total income tax provision $ 15,088 $ 17,616 $ 17,385 |
Schedule of Federal Statutory Tax Rate | The provision for income taxes differs from the amounts computed by applying the federal statutory rate as follows for the following periods: February 3, January 28, January 30, 2018 2017 2016 Federal statutory rate 33.7 % 35 % 35 % State tax, net of federal benefit 3.8 3.6 3.5 Permanent items 2.0 (0.4) 0.2 Other items (0.2) (0.9) Tax reform adjustment 6.7 — — Effective income tax rate 46.0 % 37.3 % 38.5 % |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at February 3, 2018 and January 31, 2017, respectively, are presented below: February 3, January 28, 2018 2017 Deferred tax assets: Accrued liabilities $ 369 $ 517 Deferred rent 11,703 14,833 Intangible asset 1,456 1,756 Inventories 1,906 2,757 Sales return reserve 175 372 Capital loss carryforward 41 63 Stock-based compensation 304 939 Loyalty program 1,374 — Total gross deferred tax assets $ 17,328 $ 21,237 Deferred tax liabilities: Depreciation $ (11,999) $ (15,468) Prepaid expenses (603) (672) Gift card escheatment (131) — Total gross deferred tax liabilities $ (12,733) $ (16,140) Net deferred tax asset $ 4,595 $ 5,097 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Feb. 03, 2018 | |
Commitments and Contingencies. | |
Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum lease payments for non-cancelable operating leases by fiscal year, as of February 3, 2018 are as follows: Fiscal Year: 2018 45,128 2019 43,531 2020 42,883 2021 38,759 2022 34,455 Thereafter 98,730 $ 303,486 |
Nature of Business (Details)
Nature of Business (Details) | Feb. 03, 2018statestore | Jan. 28, 2017store | Jan. 30, 2016store |
Nature of Business | |||
Number of stores | store | 87 | 4 | 2 |
Number of states | state | 22 |
Summary of Significant Accoun36
Summary of Significant Accounting Policies (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
May 05, 2018USD ($) | Feb. 03, 2018USD ($)segmentsubsidiary | Jan. 28, 2017USD ($) | Jan. 30, 2016USD ($) | |
Significant Accounting Policies [Line Items] | ||||
Number of subsidiaries | subsidiary | 4 | |||
Fiscal period duration | 371 days | 364 days | 364 days | |
Number of reportable segments | segment | 1 | |||
Allowance for doubtful accounts receivable | $ 0 | $ 0 | ||
Inventory valuation reserves | 7,139 | 6,539 | ||
Impairment charge to long-lived assets | 0 | 0 | $ 0 | |
Sales returns reserve | 697 | 964 | ||
Gift breakage income | $ 1,337 | 347 | 846 | |
Loyalty points dormancy period | 18 months | |||
Recognized customer loyalty program breakage income | $ 1,022 | 611 | 232 | |
Stop-loss insurance maintained by health insurance company, deductible per person under health insurance | 100 | |||
Reserve on claims included in accrued expenses | 922 | 1,001 | ||
Stop-loss insurance maintained by workers compensation insurance company, deductible per person under workers compensation insurance | 150 | |||
Workers compensation plan, estimated IBNR | 659 | 650 | ||
Advertising Expense | $ 7,760 | 7,513 | $ 6,634 | |
Minimum | ||||
Significant Accounting Policies [Line Items] | ||||
Furniture, fixtures, and equipment, estimated useful life | P3Y | |||
Maximum | ||||
Significant Accounting Policies [Line Items] | ||||
Furniture, fixtures, and equipment, estimated useful life | P10Y | |||
Wells Fargo Senior Secured Revolving Credit Facility | ||||
Significant Accounting Policies [Line Items] | ||||
In Transit Deposits | $ 6,629 | $ 6,138 | ||
Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 | ||||
Significant Accounting Policies [Line Items] | ||||
Gift breakage income | $ 3,400 |
Secondary Offering (Details)
Secondary Offering (Details) - Seidler Equity Partners III L.P. - Secondary Offering - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | Apr. 22, 2016 | Apr. 18, 2016 | Oct. 26, 2015 | Sep. 30, 2015 |
Subsidiary Or Equity Method Investee [Line Items] | ||||
Issuance of common shares (in shares) | 900 | 6,000 | 649 | 6,250 |
Common stock shares issued, price per share | $ 11.25 | $ 12.25 | ||
Issuance of common stock, net | $ 0 | $ 0 | $ 0 | |
Selling, General and Administrative Expenses | ||||
Subsidiary Or Equity Method Investee [Line Items] | ||||
Offering expenses | $ 143 | $ 727 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | Feb. 03, 2018 | Jan. 28, 2017 |
Property Plant And Equipment [Line Items] | ||
Total property and equipment, gross | $ 152,216 | $ 125,451 |
Less accumulated depreciation and amortization | (58,181) | (42,342) |
Total property and equipment, net | 94,035 | 83,109 |
Furniture, fixtures, and equipment | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment, gross | 65,437 | 52,719 |
Leasehold improvements | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment, gross | 84,345 | 61,986 |
Construction in progress | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment, gross | $ 2,434 | $ 10,746 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 03, 2018 | Jan. 28, 2017 | Jan. 30, 2016 | |
Property and Equipment | |||
Depreciation | $ 15,864 | $ 12,169 | $ 9,763 |
Definite Lived Intangible Ass40
Definite Lived Intangible Asset (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Feb. 03, 2018 | Jan. 28, 2017 | |
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross carrying amount | $ 9,063 | $ 9,063 |
Accumulated amortization | (8,787) | (6,945) |
Net carrying amount | $ 276 | $ 2,118 |
Non-compete agreement | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortization period | 5 years | 5 years |
Gross carrying amount | $ 9,063 | $ 9,063 |
Accumulated amortization | (8,787) | (6,945) |
Net carrying amount | $ 276 | $ 2,118 |
Definite Lived Intangible Ass41
Definite Lived Intangible Asset - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Feb. 03, 2018 | Jan. 28, 2017 | Jan. 30, 2016 | Feb. 02, 2019 | |
Amortization expense for definite lived intangible asset, fiscal year | $ 1,842 | $ 1,805 | $ 1,806 | |
Scenario Forecast | ||||
Amortization expense for definite lived intangible asset, 2018 | $ 276 |
Accrued Expenses and Other Li42
Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands | Feb. 03, 2018 | Jan. 28, 2017 |
Accrued Expenses and Other Liabilities | ||
Book overdraft | $ 9,944 | $ 5,355 |
Unearned revenue | 22,874 | 18,019 |
Accrued payroll and related expenses | 8,004 | 9,430 |
Sales and use tax payable | 3,277 | 4,802 |
Accrued construction costs | 605 | 3,138 |
Other | 5,898 | 8,842 |
Accrued expenses | $ 50,602 | $ 49,586 |
Revolving Line Of Credit (Detai
Revolving Line Of Credit (Details) - USD ($) $ in Thousands | Jul. 24, 2017 | May 18, 2017 | Feb. 03, 2018 | Jan. 28, 2017 |
LIBOR | ||||
Line Of Credit Facility [Line Items] | ||||
Debt instrument applicable margin | 6.25% | |||
Wells Fargo Senior Secured Revolving Credit Facility | ||||
Line Of Credit Facility [Line Items] | ||||
Increase line of credit facility, maximum borrowing capacity | $ 15,000 | |||
Line of credit facility, maximum borrowing capacity | $ 150,000 | |||
Line of credit facility, amount outstanding | $ 66,621 | $ 67,110 | ||
Amounts in depository under lock-box arrangements | $ 6,629 | 6,138 | ||
Weighted average interest rate on amount outstanding | 3.26% | |||
Revolving credit facility, covenant term | The Revolving Line of Credit also requires the Company to maintain a minimum availability at all times of not less than 10% of the gross borrowing base, and in any event, not less than $5,000 | |||
Line of credit , maturity date | Dec. 3, 2020 | |||
Deferred financing fees outstanding | $ 393 | 419 | ||
Amortization of deferred financing fees | $ 131 | $ 161 | ||
Wells Fargo Senior Secured Revolving Credit Facility | Minimum | ||||
Line Of Credit Facility [Line Items] | ||||
Line of credit facility gross borrowing base percentage | 10.00% | |||
Line of credit facility available borrowing capacity | $ 5,000 | |||
Wells Fargo Senior Secured Revolving Credit Facility | Federal Funds Rate | ||||
Line Of Credit Facility [Line Items] | ||||
Debt instrument applicable margin | 0.50% | |||
Wells Fargo Senior Secured Revolving Credit Facility | Base Rate | Minimum | ||||
Line Of Credit Facility [Line Items] | ||||
Debt instrument applicable margin | 0.25% | |||
Wells Fargo Senior Secured Revolving Credit Facility | Base Rate | Maximum | ||||
Line Of Credit Facility [Line Items] | ||||
Debt instrument applicable margin | 0.75% | |||
Wells Fargo Senior Secured Revolving Credit Facility | LIBOR | ||||
Line Of Credit Facility [Line Items] | ||||
Debt instrument applicable margin | 1.00% | |||
Wells Fargo Senior Secured Revolving Credit Facility | LIBOR | Minimum | ||||
Line Of Credit Facility [Line Items] | ||||
Debt instrument applicable margin | 1.25% | |||
Wells Fargo Senior Secured Revolving Credit Facility | LIBOR | Maximum | ||||
Line Of Credit Facility [Line Items] | ||||
Debt instrument applicable margin | 1.75% | |||
Wells Fargo Stand-by Commercial Letters of Credit | ||||
Line Of Credit Facility [Line Items] | ||||
Net borrowing available under revolving line of credit | $ 1,505 |
Long-Term Debt (Details)
Long-Term Debt (Details) - USD ($) $ in Thousands | Feb. 03, 2018 | Jan. 28, 2017 |
Long-Term Debt | ||
Term loan | $ 135,127 | $ 136,727 |
Less discount | (678) | (877) |
Less debt issuance costs | (1,110) | (1,146) |
Long-term debt | 133,339 | 134,704 |
Less current portion, net of discount and debt issuance costs | (990) | (983) |
Long-term portion | $ 132,349 | $ 133,721 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Details) - USD ($) $ in Thousands | May 18, 2017 | Feb. 03, 2018 | Jan. 28, 2017 | Jan. 30, 2016 |
Debt Instrument [Line Items] | ||||
Interest rate (as a percent) | 7.63% | |||
Long-term debt | $ 133,339 | $ 134,704 | ||
Debt instrument discount at issuance | 678 | 877 | ||
Unamortized debt issuance costs | 1,110 | 1,146 | ||
Amortization of discount on debt and deferred financing fees | 708 | 1,122 | $ 817 | |
Minimum | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 0.20% | |||
Maximum | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 1.30% | |||
Weighted Average | ||||
Debt Instrument [Line Items] | ||||
Leverage ratio | 0.75% | |||
Term Loan | ||||
Debt Instrument [Line Items] | ||||
Senior secured loan facility | $ 160,000 | |||
Debt instrument issuance price, percentage of aggregate principal amount | 99.00% | |||
Line of credit , maturity date | Dec. 3, 2020 | |||
Debt instrument applicable margin | 6.25% | |||
Debt issuance costs | $ 341 | |||
Quarterly loan payment | $ 400 | |||
Long-term debt | 133,339 | |||
Amortization of discount on debt and deferred financing fees | $ 199 | |||
Prior Term Loan | ||||
Debt Instrument [Line Items] | ||||
Amortization of discount on debt and deferred financing fees | $ 411 | |||
LIBOR | ||||
Debt Instrument [Line Items] | ||||
Debt instrument increase in basis spread on variable rate | 0.25% | |||
Debt instrument applicable margin | 6.25% | |||
Interest floor rate | 1.25% | |||
LIBOR | Term Loan | ||||
Debt Instrument [Line Items] | ||||
Debt instrument applicable margin | 1.25% |
Sale Leaseback Transactions (De
Sale Leaseback Transactions (Details) $ in Thousands | 12 Months Ended | ||
Feb. 03, 2018USD ($)store | Jan. 28, 2017USD ($)store | Jan. 30, 2016USD ($)store | |
Sale Leaseback Transaction [Line Items] | |||
Number of stores | store | 87 | 4 | 2 |
Tenant allowance received | $ | $ 10,696 | $ 16,718 | $ 5,652 |
Land and Buildings | Four Store Locations | |||
Sale Leaseback Transaction [Line Items] | |||
Number of stores | store | 4 | ||
Tenant allowance received | $ | $ 9,022 | $ 11,923 | $ 5,652 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Feb. 03, 2018 | Jan. 28, 2017 | Jan. 30, 2016 | |
Earnings Per Share | |||
Net income | $ 17,742 | $ 29,669 | $ 27,771 |
Weighted-average shares of common stock outstanding: | |||
Basic | 42,496 | 42,187 | 41,966 |
Dilutive effect of common stock equivalents | 26 | 298 | 368 |
Diluted | 42,522 | 42,485 | 42,334 |
Basic Earnings per share | $ 0.42 | $ 0.70 | $ 0.66 |
Diluted Earnings per share | $ 0.42 | $ 0.70 | $ 0.66 |
Restricted stock units considered anti-dilutive and excluded in the calculation | 191 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Feb. 03, 2018 | Jan. 28, 2017 | Jan. 30, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation | $ 2,294 | $ 3,186 | $ 2,257 |
Unrecognized compensation costs | $ 3,963 | $ 4,874 | |
Net share settlements | 0 | 0 | |
Nonvested Restricted Stock Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Issuance of nonvested stock units | 0 | 162 | |
Nonvested stock issued, weighted average grant date fair value per share | $ 11.25 | ||
Vesting percentage | 33.33% | ||
Vesting period | 3 years | ||
Nonvested stock units outstanding, weighted average grant date fair value per share | $ 11.25 | $ 11.25 | |
Nonvested Performance-Based Stock Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Issuance of nonvested stock units | 73 | ||
Nonvested stock issued, weighted average grant date fair value per share | $ 11.25 | ||
Vesting percentage | 33.33% | ||
Vesting period | 3 years | ||
Nonvested stock units outstanding, weighted average grant date fair value per share | $ 11.25 | $ 11.25 | |
Issuance of nonvested stock units available | 0 | 159 | |
Nonvested Stock Unit Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Issuance of nonvested stock units | 456 | 29 | |
Nonvested stock issued, weighted average grant date fair value per share | $ 5.09 | $ 9.81 | |
Nonvested stock units outstanding, weighted average grant date fair value per share | $ 5.15 | $ 7.17 | $ 7.15 |
Employees | Nonvested Stock Unit Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Issuance of nonvested stock units | 397 | ||
Nonvested stock issued, weighted average grant date fair value per share | $ 5.15 | ||
Vesting percentage | 33.33% | ||
Vesting period | 3 years | ||
Board Of Directors | Nonvested Stock Unit Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Issuance of nonvested stock units | 59 | ||
Nonvested stock issued, weighted average grant date fair value per share | $ 4.73 | ||
Vesting percentage | 8.33% | 8.33% | |
Nonvested stock awards vested over grant date | 12 months | 12 months | |
Employee Stock Plans | 2013 Plan | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Number of shares available for awards | 1,392 | ||
Number of awards outstanding | 579 | ||
Employee Stock Purchase Plan | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation | $ 160 | $ 165 | |
Selling, General and Administrative Expenses | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation | $ 2,294 | $ 3,186 | $ 2,257 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - $ / shares shares in Thousands | 12 Months Ended | |
Feb. 03, 2018 | Jan. 28, 2017 | |
Nonvested Stock Unit Awards | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Beginning balance, Shares | 301 | 599 |
Grants, Shares | 456 | 29 |
Forfeitures, Shares | 1 | 6 |
Vested, Shares | 337 | 321 |
Ending balance, Shares | 419 | 301 |
Beginning balance, Weighted average grant-date fair value | $ 7.17 | $ 7.15 |
Grants, Weighted average grant-date fair value | 5.09 | 9.81 |
Forfeitures, Weighted average grant-date fair value | 7.06 | 7.05 |
Vested, Weighted average grant-date fair value | 6.87 | 7.37 |
Ending balance, Weighted average grant-date fair value | $ 5.15 | $ 7.17 |
Nonvested Restricted Stock Awards | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Beginning balance, Shares | 162 | |
Grants, Shares | 0 | 162 |
Vested, Shares | 54 | |
Ending balance, Shares | 108 | 162 |
Beginning balance, Weighted average grant-date fair value | $ 11.25 | |
Grants, Weighted average grant-date fair value | $ 11.25 | |
Vested, Weighted average grant-date fair value | 11.25 | |
Ending balance, Weighted average grant-date fair value | $ 11.25 | $ 11.25 |
Nonvested Performance-Based Stock Awards | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Beginning balance, Shares | 73 | |
Grants, Shares | 73 | |
Vested, Shares | 24 | |
Ending balance, Shares | 49 | 73 |
Beginning balance, Weighted average grant-date fair value | $ 11.25 | |
Grants, Weighted average grant-date fair value | $ 11.25 | |
Vested, Weighted average grant-date fair value | 11.25 | |
Ending balance, Weighted average grant-date fair value | $ 11.25 | $ 11.25 |
Employee Stock Purchase Plan (D
Employee Stock Purchase Plan (Details) - USD ($) shares in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Jun. 30, 2015 | Feb. 03, 2018 | Jan. 28, 2017 | Jan. 30, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Number of shares granted under ESPP | 800 | |||
Stock-based compensation expense | $ 2,294 | $ 3,186 | $ 2,257 | |
Employee Stock Purchase Plan | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Percentage of market value per share fixed as purchase price | 85.00% | |||
Stock-based compensation expense | $ 160 | $ 165 |
Employee Stock Purchase Plan -
Employee Stock Purchase Plan - Additional Information (Details) | 12 Months Ended | |
Feb. 03, 2018 | Jan. 28, 2017 | |
Stock-Based Compensation | ||
Risk-free interest rate | 1.53% | 0.66% |
Expected life (in years) | 6 months | 6 months |
Expected volatility | 45.30% | 25.60% |
Income Taxes - Provision for In
Income Taxes - Provision for Income Tax (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 03, 2018 | Jan. 28, 2017 | Jan. 30, 2016 | |
Current: | |||
Federal | $ 12,718 | $ 14,919 | $ 12,341 |
State | 1,868 | 2,530 | 1,982 |
Total current | 14,586 | 17,449 | 14,323 |
Deferred: | |||
Federal | 780 | 164 | 2,746 |
State | (278) | 3 | 316 |
Total deferred | 502 | 167 | 3,062 |
Total income tax provision | $ 15,088 | $ 17,616 | $ 17,385 |
Income Taxes - Schedule of Fede
Income Taxes - Schedule of Federal Statutory Tax Rate (Details) | 12 Months Ended | |||
Feb. 03, 2018 | Dec. 31, 2017 | Jan. 28, 2017 | Jan. 30, 2016 | |
Reconciliation of the federal statutory income tax rate to the effective income tax rate | ||||
Federal statutory rate | 33.70% | 35.00% | 35.00% | 35.00% |
State tax, net of federal benefit | 3.80% | 3.60% | 3.50% | |
Permanent items | 2.00% | 0.20% | ||
Permanent items | (0.40%) | |||
Other items | (0.20%) | (0.90%) | (0.20%) | |
Tax reform adjustment | 6.70% | |||
Effective income tax rate | 46.00% | 37.30% | 38.50% |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Feb. 03, 2018 | Jan. 28, 2017 |
Deferred tax assets: | ||
Accrued liabilities | $ 369 | $ 517 |
Deferred rent | 11,703 | 14,833 |
Intangible asset | 1,456 | 1,756 |
Inventories | 1,906 | 2,757 |
Sales return reserve | 175 | 372 |
Capital loss carryforward | 41 | 63 |
Stock-based compensation | 304 | 939 |
Loyalty program | 1,374 | |
Total gross deferred tax assets | 17,328 | 21,237 |
Deferred tax liabilities: | ||
Depreciation | (11,999) | (15,468) |
Prepaid expenses | (603) | (672) |
Gift card escheatment | (131) | |
Total gross deferred tax liabilities | (12,733) | (16,140) |
Net deferred tax asset | $ 4,595 | $ 5,097 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018 | Feb. 03, 2018 | Dec. 31, 2017 | Jan. 28, 2017 | Jan. 30, 2016 | |
U.S. Federal statutory rate | 33.70% | 35.00% | 35.00% | 35.00% | |
Discrete net tax expense | $ 2,153 | ||||
Tax expense | 2,600 | ||||
Tax benefit | 447 | ||||
Unrecognized tax benefits | 0 | ||||
Accrued interest and penalties | $ 95 | ||||
Scenario Forecast | |||||
U.S. Federal statutory rate | 21.00% |
Commitments and Contingencies56
Commitments and Contingencies (Details) $ in Thousands | May 09, 2015USD ($) | Mar. 12, 2014store | Feb. 03, 2018USD ($)Option | Jan. 28, 2017USD ($) | Jan. 30, 2016USD ($) | Jan. 31, 2015USD ($) |
Operating Leases | ||||||
Tenant allowance received | $ 10,696 | $ 16,718 | $ 5,652 | |||
Tenant Allowances Expect To Be Received | $ 6,112 | |||||
Lease Expiration Date | 2030-07 | |||||
Number of renewal options | Option | 3 | |||||
Renewal options (in years) | 5 years | |||||
Rent expense | $ 49,860 | $ 37,132 | 33,209 | |||
Number of stores assume in purchase of assets | store | 2 | |||||
Loss contingency trial start date | Mar. 2, 2015 | |||||
Loss contingency trial end date | Mar. 6, 2015 | |||||
Trial award against defendants to the action | $ 11,887 | |||||
Accrued amount of litigation | $ 4,000 | |||||
Reversal amount of accrued litigation settlement | $ 4,000 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Thousands | Feb. 03, 2018USD ($) |
Operating Leases | |
2,018 | $ 45,128 |
2,019 | 43,531 |
2,020 | 42,883 |
2,021 | 38,759 |
2,022 | 34,455 |
Thereafter | 98,730 |
Operating Leases, Future Minimum Payments Due | $ 303,486 |
Related-Party Transactions (Det
Related-Party Transactions (Details) - Seidler Equity Partners III L.P. - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 03, 2018 | Jan. 28, 2017 | Jan. 30, 2016 | |
Related Party Transaction [Line Items] | |||
Related party agreement date | Aug. 14, 2009 | ||
Payments made to related party | $ 5 | $ 2 | $ 12 |
Amounts payable to related party | 0 | $ 0 | |
Maximum | |||
Related Party Transaction [Line Items] | |||
Reimbursement cost and expenses of related party | $ 150 |
Retirement Plan (Details)
Retirement Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 03, 2018 | Jan. 28, 2017 | Jan. 30, 2016 | |
Retirement Plan | |||
Company contribution under plan | $ 390 | $ 351 | $ 282 |
Subsequent Event (Details)
Subsequent Event (Details) - Subsequent Event - Mr. John Schaefer shares in Thousands, $ in Thousands | Mar. 18, 2018USD ($)shares |
Subsequent Event [Line Items] | |
Aggregate amount subject to tax withholdings and other deductions | $ | $ 1,459 |
Period for payment | 18 months |
Number of unvested shares subject to accelerated vesting | shares | 242 |