Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Feb. 01, 2020 | Apr. 09, 2020 | Aug. 02, 2019 | |
Document And Entity Information | |||
Document Type | 10-K | ||
Document Period End Date | Feb. 1, 2020 | ||
Entity Registrant Name | SPORTSMAN'S WAREHOUSE HOLDINGS, INC. | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Interactive Data Current | Yes | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 43,298,934 | ||
Entity Public Float | $ 169,032,443 | ||
Current Fiscal Year End Date | --02-01 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0001132105 | ||
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Feb. 01, 2020 | Feb. 02, 2019 |
Current assets: | ||
Cash | $ 1,685 | $ 1,547 |
Accounts receivable, net | 904 | 249 |
Merchandise inventories | 275,505 | 276,600 |
Income tax receivable | 812 | |
Prepaid expenses and other | 12,732 | 15,174 |
Total current assets | 291,638 | 293,570 |
Operating lease right of use asset | 224,520 | |
Property and equipment, net | 98,767 | 92,084 |
Deferred income taxes | 2,997 | |
Goodwill | 1,496 | |
Definite lived intangibles, net | 220 | 246 |
Total assets | 616,641 | 388,897 |
Current liabilities: | ||
Accounts payable | 38,157 | 24,953 |
Accrued expenses | 70,118 | 56,384 |
Income taxes payable | 1,838 | |
Operating lease liability, current | 34,487 | |
Revolving line of credit | 116,078 | 144,306 |
Current portion of long-term debt, net of discount and debt issuance costs | 5,936 | 7,915 |
Current portion of deferred rent | 5,270 | |
Total current liabilities | 264,776 | 240,666 |
Long-term liabilities: | ||
Long-term debt, net of discount, debt issuance costs, and current portion | 23,781 | 27,717 |
Deferred income taxes | 562 | |
Deferred rent, noncurrent | 41,854 | |
Operating lease liability, noncurrent | 217,254 | |
Total long-term liabilities | 241,597 | 69,571 |
Total liabilities | 506,373 | 310,237 |
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; 43,296 and 42,978 shares issued and outstanding, respectively | 433 | 430 |
Additional paid-in capital | 86,806 | 84,671 |
Accumulated earnings (deficit) | 23,029 | (6,441) |
Total stockholders' equity | 110,268 | 78,660 |
Total liabilities and stockholders' equity | $ 616,641 | $ 388,897 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Feb. 01, 2020 | Feb. 02, 2019 |
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 | 43,296 | 42,978 |
Common stock, shares outstanding | 43,296 | 42,978 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Feb. 01, 2020 | Feb. 02, 2019 | Feb. 03, 2018 | |
CONSOLIDATED STATEMENTS OF INCOME | |||
Net sales | $ 886,401 | $ 849,129 | $ 809,671 |
Cost of goods sold | 589,768 | 564,199 | 535,811 |
Gross profit | 296,633 | 284,930 | 273,860 |
Selling, general, and administrative expenses | 263,169 | 240,911 | 227,292 |
Income from operations | 33,464 | 44,019 | 46,568 |
Interest expense | 7,995 | 13,206 | 13,738 |
Income before income taxes | 25,469 | 30,813 | 32,830 |
Income tax expense | 5,254 | 7,063 | 15,088 |
Net income | $ 20,215 | $ 23,750 | $ 17,742 |
Income per share: | |||
Basic | $ 0.47 | $ 0.55 | $ 0.42 |
Diluted | $ 0.46 | $ 0.55 | $ 0.42 |
Weighted average shares outstanding: | |||
Basic | 43,166 | 42,878 | 42,496 |
Diluted | 43,588 | 42,979 | 42,522 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) shares in Thousands, $ in Thousands | Common Stock | Additional Paid-in-capital | Accumulated (Deficit) Earnings | Total |
Balance, shares at Jan. 28, 2017 | 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 | |||
Balance at Feb. 03, 2018 | $ 426 | 82,197 | (32,825) | 49,798 |
Vesting of restricted stock units (in shares) | 275 | |||
Vesting of restricted stock units | $ 3 | (3) | ||
Payment of withholdings on restricted stock units | (703) | (703) | ||
Issuance of common stock for cash per employee stock purchase plan (in shares) | 86 | |||
Issuance of common stock for cash per employee stock purchase plan | $ 1 | 351 | 352 | |
Stock based compensation | 2,829 | 2,829 | ||
Net income | 23,750 | $ 23,750 | ||
Balance, shares at Feb. 02, 2019 | 42,978 | 42,978 | ||
Balance at Feb. 02, 2019 | $ 430 | 84,671 | (6,441) | $ 78,660 |
Impact of change for ASC adoption | ASC Topic 606 | 2,634 | 2,634 | ||
Vesting of restricted stock units (in shares) | 198 | |||
Vesting of restricted stock units | $ 2 | (2) | ||
Payment of withholdings on restricted stock units | (369) | (369) | ||
Issuance of common stock for cash per employee stock purchase plan (in shares) | 120 | |||
Issuance of common stock for cash per employee stock purchase plan | $ 1 | 402 | 403 | |
Stock based compensation | 2,104 | 2,104 | ||
Net income | 20,215 | $ 20,215 | ||
Balance, shares at Feb. 01, 2020 | 43,296 | 43,296 | ||
Balance at Feb. 01, 2020 | $ 433 | $ 86,806 | 23,029 | $ 110,268 |
Impact of change for ASC adoption | ASU 2016-02 | $ 9,255 | $ 9,255 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 01, 2020 | Feb. 02, 2019 | Feb. 03, 2018 | |
Cash flows from operating activities: | |||
Net income | $ 20,215 | $ 23,750 | $ 17,742 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation of property and equipment | 19,294 | 17,961 | 15,864 |
Amortization and write-off of discount on debt and deferred financing fees | 339 | 2,043 | 708 |
Amortization of definite lived intangible | 26 | 289 | 1,842 |
Change in deferred rent | 568 | 8,098 | |
(Gain) loss on asset dispositions | (311) | 30 | 516 |
Noncash lease expense | 27,009 | ||
Deferred income taxes | 710 | 714 | 502 |
Stock-based compensation | 2,104 | 2,829 | 2,294 |
Change in operating assets and liabilities, net of amounts acquired: | |||
Accounts receivable, net | (655) | 70 | 92 |
Operating lease liabilities | (28,374) | ||
Merchandise inventories | 20,247 | (6,006) | (24,305) |
Prepaid expenses and other | (1,571) | (5,339) | (681) |
Accounts payable | 12,709 | (11,726) | 7,536 |
Accrued expenses | 8,774 | 7,739 | (1,040) |
Income taxes payable and receivable | (2,650) | (749) | 1,607 |
Net cash provided by operating activities | 77,866 | 32,173 | 30,775 |
Cash flows from investing activities: | |||
Purchase of property and equipment, net of amounts acquired | (30,372) | (17,936) | (41,172) |
Purchase of intangible asset | (259) | ||
Acquisition of Field and Stream stores, net of cash acquired | (28,536) | ||
Proceeds from deemed sale-leaseback transactions | 1,717 | 9,022 | |
Proceeds from sale-leaseback transactions | 9,533 | ||
Proceeds from sale of property and equipment | 311 | 226 | 14 |
Net cash used in investing activities | (49,064) | (16,252) | (32,136) |
Cash flows from financing activities: | |||
Net (payments) borrowings on line of credit | (28,228) | 84,314 | (980) |
Increase in book overdraft | 5,530 | 353 | 4,589 |
Proceeds from issuance of common stock per employee stock purchase plan | 403 | 351 | 396 |
Payment of withholdings on restricted stock units | (369) | (703) | (635) |
Borrowings on term loan | 40,000 | ||
Payment of deferred financing costs | (1,331) | (551) | |
Principal payments on long-term debt | (6,000) | (139,127) | (1,600) |
Net cash (used in) provided by financing activities | (28,664) | (16,143) | 1,219 |
Net change in cash | 138 | (222) | (142) |
Cash at beginning of period | 1,547 | 1,769 | 1,911 |
Cash at end of period | 1,685 | 1,547 | 1,769 |
Cash paid during the period for: | |||
Interest, net of amounts capitalized | 7,945 | 13,240 | 13,532 |
Income taxes, net of refunds | 7,292 | 7,094 | 12,839 |
Supplemental schedule of noncash activities: | |||
Noncash change in operating lease right of use asset and operating lease liabilities from remeasurement of existing leases and addition of new leases | 66,095 | ||
Purchases of property and equipment included in accounts payable and accrued expenses | $ 1,112 | $ 1,189 | $ 1,142 |
Nature of Business
Nature of Business | 12 Months Ended |
Feb. 01, 2020 | |
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 1, 2020, the Company operated 103 stores in 27 states. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Feb. 01, 2020 | |
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 2019 ended February 1, 2020 and contained 52 weeks of operation. Fiscal year 2018 ended February 2, 2019 and contained 52 weeks of operations. Fiscal year 2017 ended February 3, 2018 and contained 53 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 operating accounts 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 or similar 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 1, 2020 and February 2, 2019, the combined balance in these accounts was $7,400 and $7,035, respectively. Accordingly, these amounts have been classified as a reduction in the line of credit as if the transfers had occurred on February 1, 2020 and February 2, 2019, 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 1, 2020 and February 2, 2019, the Company had no allowance for doubtful accounts receivable. Merchandise Inventories The Company measures its inventory at the lower of cost or net realizable value. 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 write downs for shrinkage, damage, or obsolescence totaled $5,761 and $7,012 at February 1, 2020 and February 2, 2019, 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 1, 2020, February 2, 2019, and February 3, 2018. Goodwill At least annually, during the fourth quarter, or when events and circumstances warrant an evaluation, the Company performs its impairment assessment of goodwill. This assessment permits an entity to initially perform a qualitative assessment of whether it is more likely than not that a reporting unit’s fair value is less than its carrying amount before applying the quantitative goodwill impairment test. If an entity concludes that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, it would not need to perform the impairment test for the reporting unit. If it is determined that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the impairment analysis is performed, which incorporates a fair-value based approach. The Company determines the fair value of its reporting units based on discounted cash flows and market approach analyses as considered necessary. The Company considers factors such as the economy, reduced expectations for future cash flows coupled with a decline in the market price of its stock and market capitalization for a sustained period as indicators for potential goodwill impairment. If the reporting unit’s carrying amount exceeds its fair value, the Company will record an impairment charge based on that difference. The impairment charge will be limited to the amount of goodwill allocated to that reporting unit. No impairment charge to goodwill was recorded during the fiscal year ended February 1, 2020. Prepaid Expenses and Other Prepaid expenses and other primarily consists of prepaid expenses, vendor rebates receivable, vendor advertising receivables and miscellaneous deposits. Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842), which requires lessees to recognize on the balance sheet assets and liabilities for leases with lease terms of more than 12 months. Consistent with prior GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee will depend primarily on its classification as a finance or operating lease. However, unlike prior GAAP—which required only finance (formerly capital) leases to be recognized on the balance sheet—the new ASU requires both types of leases to be recognized on the balance sheet. The ASU took effect for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. This standard could be applied at the beginning of the earliest period presented using the modified retrospective approach, which includes certain practical expedients that an entity may elect to apply, including an election to use certain transition relief. In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases and ASU No. 2018-11, Leases (Topic 842): Targeted Improvements, which made improvements to Accounting Standards Codification (“ASC”) 842 and allow entities to not restate comparative periods in transition to ASC 842 and instead report the comparative periods under ASC 840 . The Company adopted ASC 842 using the modified retrospective approach on February 3, 2019, coinciding with the standard’s effective date. In accordance with ASC 842, the Company did not restate prior comparative periods in transition to ASC 842 and instead reported prior comparative periods under ASC 840. Adoption of the standard resulted in the initial recognition of operating lease right-of-use (“ROU”) assets of $183,000 and operating lease liabilities of $214,000 as of February 3, 2019. These amounts were based on the present value of such commitments as of February 3, 2019 using the Company’s incremental borrowing rate (“IBR”), which was determined through use of the Company’s credit rating to develop a rate curve that approximates the Company’s market risk profile. The adoption of this standard had a material impact on the Company’s consolidated statement of income, balance sheet, stockholders’ equity and cash flows, with a $9,300 net adjustment recorded to beginning retained earnings on February 3, 2019 due to the acceleration of recognition of a deferred gain and derecognition of the related deferred tax asset the Company was amortizing relating to the historical sale and lease back of owned properties. In addition, the Company completed its evaluation of the practical expedients offered and enhanced disclosures required in ASC 842, as well as reviewed arrangements to identify embedded leases, among other activities, to account for the adoption of this standard. The Company elected the following practical expedients: · A package of practical expedients allowing the Company to: 1. Carry forward its historical lease classification (i.e. it was not necessary to reclassify any existing leases at the adoption date of ASC 842), 2. Avoid reassessing whether any expired or existing contracts are or contain leases, and 3. Avoid reassessing initial indirect costs for any existing lease. · A practical expedient allowing the Company to not separate lease components (e.g. fixed payments including, rent, real estate taxes, and insurance costs) from nonlease components (e.g. common area maintenance costs), primarily impacting the Company’s real estate leases. The election of this practical expedient eliminates the burden of separately estimating the real estate lease and nonlease costs on a relative stand-alone basis. · A practical expedient related to land easements, allowing the Company to carry forward the accounting treatment for land easements on existing agreements and eliminated the need to reassess existing lease contracts to determine if land easements are separate leases under ASC 842. The Company did not elect a practical expedient which would allow the Company to use hindsight in determining the lease term (that is, when considering lessee options to extend or terminate the lease and to purchase the underlying asset) and to assess impairment of the entity’s ROU assets, since election of this expedient could make adoption of ASC 842 more complex given that re-evaluation of the lease term and impairment consideration affect other aspects of lease accounting. In accordance with ASC 842, the Company determines if an arrangement is a lease at inception. The Company has operating leases for the Company’s retail stores, distribution center, and corporate office. Operating leases are included in operating lease ROU assets and operating lease liabilities, current and noncurrent, on the consolidated balance sheet. Lease liabilities are initially recorded at the present value of the lease payments by discounting the lease payments by the IBR and then recording accretion over the lease term using the effective interest method. Operating lease classification results in a straight-line expense recognition pattern over the lease term and recognized lease expense as a single expense component, which results in amortization of the ROU asset that equals the difference between lease expense and interest expense. Operating lease expense is included in selling, general and administrative expense, based on the use of the leased asset, on the consolidated statement of income. Leases with an initial term of 12 months or less are not recorded on the balance sheet and are not material; the Company recognizes lease expense for these leases on a straight-line basis over the remaining lease term. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the reasonably certain lease term. As the Company’s leases generally do not provide an implicit rental rate, the Company uses an IBR to determine the present value of future rental payments. The IBR is determined by using the Company’s credit rating to develop a yield curve that approximates the Company’s market risk profile. The operating lease ROU asset also includes any prepaid lease payments made by the tenant and is reduced by lease incentives such as tenant improvement allowances. The operating lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense is recognized on a straight-line basis over the lease term. For fiscal 2018, the Company evaluated and classified its leases as operating leases for financial reporting purposes, in accordance with ASC 840. In accordance with ASC 840, deferred rent represents the difference between rent paid and amounts expensed for operating leases. Certain leases have scheduled rent increases, and certain leases include an initial period of free or reduced rent as an inducement to enter into the lease agreement (“rent holidays”). The Company recognized rent expense for rent increases and rent holidays on a straight-line basis over the term of the underlying leases, without regard to when rent payments are made. The calculation of straight-line rent begins on the possession date and extends through the “reasonably assured” lease term as defined in ASC 840. Additionally, in accordance with ASC 840, landlord allowances for tenant improvements, or lease incentives, were recorded as deferred rent and amortized on a straight-line basis over the “reasonably assured” lease term as a component of rent expense. See Note 6 for a further discussion on leases. Revenue Recognition Revenue recognition accounting policy The Company operates solely as an outdoor retailer, which includes both retail stores and an e-commerce platform, that offers a broad range of products in the United States and online. Generally, all revenues are recognized when control of the promised goods is transferred to customers, in an amount that reflects the consideration in exchange for those goods. Accordingly, the Company implicitly enters into a contract with customers to deliver merchandise inventory at the point of sale. Collectability is reasonably assured since the Company only extends immaterial credit purchases to certain municipalities. Substantially all of the Company’s revenue is for single performance obligations for the following distinct items: · Retail store sales · E-commerce sales · Gift cards and loyalty rewards program For performance obligations related to retail store and e-commerce sales contracts, the Company typically transfers control, for retail stores, upon consummation of the sale when the product is paid for and taken by the customer and, for e-commerce sales, when the products are tendered for delivery to the common carrier. The transaction price for each contract is the stated price on the product, reduced by any stated discounts at that point in time. The Company does not engage in sales of products that attach a future material right which could result in a separate performance obligation for the purchase of goods in the future at a material discount. The implicit point-of-sale contract with the customer, as reflected in the transaction receipt, states the final terms of the sale, including the description, quantity, and price of each product purchased. Payment for the Company’s contracts is due in full upon delivery. The customer agrees to a stated price implicit in the contract that does not vary over the contract. The transaction price relative to sales subject to a right of return reflects the amount of estimated consideration to which the Company expects to be entitled. This amount of variable consideration included in the transaction price, and measurement of net sales, is included in net sales only to the extent that it is probable that there will be no significant reversal in a future period. Actual amounts of consideration ultimately received may differ from the Company’s estimates. The allowance for sales returns is estimated based upon historical experience and a provision for estimated returns is recorded as a reduction in sales in the relevant period. The estimated merchandise inventory cost related to the sales returns is recorded in prepaid expenses and other. The estimated refund liabilities are recorded in accrued expenses. If actual results in the future vary from the Company’s estimates, the Company adjusts these estimates, which would affect net sales and earnings in the period such variances become known. Contract liabilities are recognized primarily for gift card sales and our loyalty reward program. Cash received from the sale of gift cards is recorded as a contract liability in accrued expenses, and the Company recognizes revenue upon the customer’s redemption of the gift card. Gift card breakage is recognized as revenue in proportion to the pattern of customer redemptions by applying a historical breakage rate of 3.5% when no escheat liability to relevant jurisdictions exists. Based upon historical experience, gift cards are predominantly redeemed in the first two years following their issuance date. The Company does not sell or provide gift cards that carry expiration dates. ASC 606 requires the Company to allocate the transaction price between the goods and the loyalty reward points based on the relative stand alone selling price. The Company recognized revenue for the breakage of loyalty reward points as revenue in proportion to the pattern of customer redemption of the points by applying a historical breakage rate of 50% when no escheat liability to relevant jurisdictions exists. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue. Sales returns The Company allows customers to return items purchased within 30 days provided the merchandise is in resaleable condition with original packaging and the original sales/gift receipt is presented. We estimate a reserve for sales returns and record the respective reserve amounts, including a right to return asset when a product is expected to be returned and resold. Historical experience of actual returns and customer return rights are the key factors used in determining the estimated sales returns. Contract Balances The following table provides information about right of return assets, contract liabilities, and sales return liabilities with customers as of fiscal year ended February 1, 2020 and Februrary 2, 2019: February 1, 2020 February 2, 2019 Right of return assets, which are included in prepaid expenses and other $ 1,683 $ 1,496 Estimated gift card contract liability, net of breakage (13,575) (11,569) Estimated loyalty contract liability, net of breakage (9,621) (8,729) Sales return liabilities, which are included in accrued expenses (2,512) (2,233) For the fiscal years ended February 1, 2020, February 2, 2019, and February 3, 2018, the Company recognized $1,430, $1,007, and $1,337 in gift card breakage, respectively. For the fiscal years ended February 1, 2020, February 2, 2019, and February 3, 2018, the Company recognized $2,480, $1,439, and $1,022, in loyalty reward breakage, respectively. The impact of these adjustments on the statement of cash flow for the year ended February 1, 2020 were recorded in cash provided by operating activities. For the fiscal years ended February 1, 2020 and February 2, 2019 the Company recognized $8,219 and $8,802 of revenue related to the beginning gift card liability from the previous year. The current balance of the right of return assets is the expected amount of inventory to be returned that is expected to be resold. The current balance of the contract liabilities primarily relates to the gift card and loyalty reward program liabilities. The Company expects the revenue associated with these liabilities to be recognized in proportion to the pattern of customer redemptions over the next two years. The current balance of sales return liabilities is the expected amount of sales returns from sales that have occurred. Practical expedients and policy elections The Company applied the following practical expedients in its application for Topic 606: · The Company elected to apply the practical expedient, relative to e-commerce sales, which allows an entity to account for shipping and handling as fulfillment activities, and not a separate performance obligation. Accordingly, the Company recognizes revenue for only one performance obligation, the sale of the product, at the shipping point (when the customer gains control). Revenue associated with shipping and handling is not material. The costs associated with fulfillment are recorded in costs of goods sold. · The Company elected to apply the practical expedient, relative to sales tax collected, which allows an entity to exclude from its transaction price any amounts collected from customers for all sales (and other similar) taxes. Disaggregation of revenue from contracts with customers In the following table, revenue from contracts with customers is disaggregated by department. The percentage of net sales related to our departments for the fiscal years ended February 1, 2020, February 2, 2019, and February 3, 2018, were as follows: Fiscal Year Ended February 1, February 2, February 3, Department Product Offerings 2020 2019 2018 Camping Backpacks, camp essentials, canoes and kayaks, coolers, outdoor cooking equipment, sleeping bags, tents and tools Clothing Camouflage, jackets, hats, outerwear, sportswear, technical gear and work wear Fishing Bait, electronics, fishing rods, flotation items, fly fishing, lines, lures, reels, tackle and small boats Footwear Hiking boots, socks, sport sandals, technical footwear, trail shoes, casual shoes, waders and work boots Hunting and Shooting Ammunition, archery items, ATV accessories, blinds and tree stands, decoys, firearms, reloading equipment and shooting gear Optics, Electronics, Accessories, and Other Gift items, GPS devices, knives, lighting, optics (e.g. binoculars), two-way radios, and other license revenue, net of revenue discounts Total The Company adopted Accounting Standard Codification (“ASC”) Topic 606 on February 4, 2018, using the modified retrospective approach to all open contracts, with the cumulative effect of adopting the new standard being recognized in retained earnings at February 4, 2018. Therefore, the prior periods comparative information has not been adjusted and continues to be reported under Topic 605. The adoption of Topic 606 resulted in an increase in prepaid expenses and other assets of $1,054 for the recognition of the right of return assets; an increase in accrued expenses relating to the sales return liability of $1,054 for the recognition of the sales return liability on a gross basis; a decrease in accrued expenses of $3,521 relating to the breakage of loyalty rewards and gift cards in order to adjust the breakage pattern of the loyalty program and gift cards to match the usage; a decrease of $884 in deferred tax assets relating to the tax impact of the entries recorded for the gift card and loyalty program liabilities; and a decrease in accumulated deficit of $2,634 as a cumulative effect of the adoption. The largest driver of changes for the adoption of Topic 606 was the change in the method of estimating breakage for the Company’s outstanding gift cards and loyalty reward liabilities. Under Topic 605, this breakage was historically recorded when it was determined that the gift cards or loyalty reward points were not probable to be redeemed, which was after two years for gift cards and 18 months for loyalty reward points. Topic 606, the breakage recognized for the loyalty reward program and gift cards is now estimated based off of historical breakage percentages, and is recognized in-line with the expected usage of the loyalty points and gift cards. 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. 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 1, 2020, and February 2, 2019, the Company estimated the IBNR for this plan to be $945 and $900, 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 1, 2020, and February 2, 2019, the Company estimated the IBNR for this plan to be $902 and $1,045, 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 1, 2020, February 2, 2019, and February 3, 2018, net advertising expenses totaled $11,493, $8,437, and $7,760, 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 As of February 1, 2020, and February 2, 2019 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. 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 hel |
Acquisition of Field and Stream
Acquisition of Field and Stream Stores | 12 Months Ended |
Feb. 01, 2020 | |
Acquisition of Field and Stream Stores | |
Acquisition of Field and Stream Stores | (3) Acquisition of Field & Stream Stores On September 28, 2019, Sportsman’s Warehouse, a wholly owned subsidiary of the Company, entered into an Asset Purchase Agreement (the “Purchase Agreement”) with DICK’S Sporting Goods, Inc. (“DICK’S”). Pursuant to the Purchase Agreement, Sportsman’s Warehouse agreed, subject to certain conditions, to acquire from DICK’S all cash, inventory, furniture, fixtures, and equipment, and certain other assets related to up to eight Field & Stream stores operated by DICK’S (the “Acquired Stores”). The Acquired Stores are located in New York (2), Pennsylvania (3), North Carolina (2) and Michigan (1). The acquisition of the eight Acquired Stores closed on October 11, 2019 (the “Closing Date”). On or prior to the Closing Date, Sportsman’s Warehouse entered into a sublease with DICK’s with respect to each Acquired Store location. Pursuant to the Purchase Agreement and in connection with closing of the acquisition, the parties also entered into a transition services agreement related to the Acquired Stores by which DICK’S provided transition services to the Company for a period of up to 120 days of the Closing Date. The aggregate consideration paid to DICK’S under the Purchase Agreement was $28.7 million (the “Purchase Price”). On the Closing Date, Sportsman’s Warehouse drew $19.8 million under the Revolving Line of Credit (as defined below) to fund a portion of the Purchase Price. The remaining approximately $9 million of consideration owed to DICK’S was paid in January 2020. As part of the acquisition, the Company incurred legal, accounting, and other due diligence fees that were expensed as incurred. Total fees incurred for the year ended February 1, 2020 were $662 which were included as a component of Selling, general, and administrative expenses. The following table summarizes the Purchase Price consideration and related cash outflow at the Closing Date: October 11, 2019 Cash paid to seller $ 19,241 Payable to seller 9,462 Total purchase price $ 28,703 The Purchase Price of $28,703 has been allocated to the identifiable assets acquired based on their respective estimated fair values. No liabilities were assumed as part of the acquisition of the Acquired Stores other than the lease obligation. The excess of the Purchase Price over the fair value of the tangible and intangible assets acquired is recorded as goodwill. The following table summarizes the estimated fair value of the identifiable assets acquired and assumed liabilities as of the Closing Date: October 11, 2019 Cash $ 167 Inventory 19,152 Property, plant, and equipment 5,250 Operating lease right of use asset 33,436 Operating lease right of use liability (31,051) Deferred tax asset 253 Goodwill 1,496 Total $ 28,703 As of February 1, 2020, the Company has finalized its allocation of the purchase price to the identifiable assets and does not expect any further adjustments to the allocation in future periods. Right of Use Asset and Liability The right of use asset and liability were determined by taking the present value of the future minimum lease payments associated with the Acquired stores. The Company utilized discount rates for the leases similar to the rates used to present value its other leases. The difference between the asset and the liability noted above is attributable to net favorable lease rates in the acquired store leases. Goodwill Goodwill represents the excess of the Purchase price over the fair value of the assets acquired. The Company believes that the primary factors supporting the amount of goodwill is the workforce acquired in the store locations. The amount of goodwill that is amortizable for tax purposes is $4,134. Results of Operations The results of operations of the Acquired Stores were included in the Company’s results of operations beginning on October 11, 2019. From October 11, 2019 through February 1, 2020 the Acquired stores generated net sales of $24,345 and net income of approximately $2,246. Pro Forma Results (unaudited) The following pro forma results are based on the individual historical results of the acquired stores with adjustments to give effect to the combined operations as if the acquisition had been consummated at the beginning of fiscal year 2018. The pro forma results are intended for informational purposes only and do not purport to represent what the combined results of operations would actually have been had the acquisition in fact occurred at the beginning of the earliest period presented. The pro forma information includes the following adjustments (i) depreciation based on the fair value of acquired property, plant, and equipment; (ii) cost of goods sold based on the step-up in fair value of the acquired inventory; (iii) interest expense incurred in connection with the borrowings on the Revolving Line of Credit used to finance the acquisition; and (iv) elimination of acquisition expenses. Fiscal Year Ended February 1, February 2, 2020 2019 Net sales $ 931,703 923,678 Net income $ 20,369 26,624 Earnings per share: Basic $ 0.47 0.62 Diluted $ 0.47 0.62 In addition, in March 2020 the Company acquired one additional Field & Stream stores from DICK’S and entered into an asset purchase agreement for a second additional Field & Stream store. See Note 19, Subsequent Event for additional information. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Feb. 01, 2020 | |
Property and Equipment. | |
Property and Equipment | (4) Property and Equipment Property and equipment as of February 1, 2020 and February 2, 2019 was as follows: February 1, February 2, 2020 2019 Furniture, fixtures, and equipment $ 84,059 $ 71,820 Leasehold improvements 103,791 94,573 Construction in progress 1,571 1,743 Total property and equipment, gross 189,421 168,136 Less accumulated depreciation and amortization (90,654) (76,052) Total property and equipment, net $ 98,767 $ 92,084 Depreciation expense was $19,294, $17,961, and $15,864, for the fiscal years ended February 1, 2020, February 2, 2019, and February 3, 2018, respectively. |
Definite Lived Intangible Asset
Definite Lived Intangible Assets | 12 Months Ended |
Feb. 01, 2020 | |
Definite Lived Intangible Asset | |
Definite Lived Intangible Assets | (5) Definite Lived Intangible Assets The following table summarizes the definite lived intangible assets: February 1, 2020 Amortization period Gross carrying amount Accumulated amortization Net carrying amount Amortizing intangible assets: Domain Name 10 years 257 (37) 220 Total $ 257 (37) 220 February 2, 2019 Amortization period Gross carrying amount Accumulated amortization Net carrying amount Amortizing intangible assets: Non-compete agreement 5 years $ 9,063 (9,063) - Domain Name 10 years 257 (11) 246 Total $ 9,320 (9,074) 246 Amortization expense for definite lived intangible asset was $26, $289, and $1,842, for the fiscal years ended February 1, 2020, February 2, 2019, and February 3, 2018, respectively. |
Leases
Leases | 12 Months Ended |
Feb. 01, 2020 | |
Leases | |
Leases | (6) Leases At the inception of the lease, the Company’s operating leases have remaining certain lease terms of up to 10 years, which typically includes multiple options for the Company to extend the lease which are not reasonably certain. The adoption of ASC 842 resulted in recording a non-cash transitional adjustment to ROU assets and operating lease liabilities of $183,000 and $214,000, respectively, as of February 3, 2019. The difference between the ROU assets and operating lease liabilities at transition primarily represented existing deferred rent, tenant improvement allowances and prepaid rent of $14,200, $20,600 and $3,800, respectively, which were recorded as a component of the ROU asset in connection with the non-cash transitional adjustment. As a result of the adoption of ASC 842, the Company also recorded an increase to retained earnings of $9,300, net of tax, as of February 3, 2019, in relation to the accelerated recognition of a deferred lease gain, and derecognition of the related deferred tax asset, which the Company was amortizing relating to the historical sales of owned properties it currently leases. In the fiscal year ended February 1, 2020, the Company recorded a non-cash increase of $66,095, to ROU assets and operating lease liabilities resulting from lease remeasurements from the exercise of lease extension options, acquired leases, and new leases added. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. In accordance with ASC 842, total lease expense, including common area maintenance (CAM), recorded during the fiscal year ended February 1, 2020 was $59,846. In accordance with ASC 842, other information related to leases was as follows: Fiscal Year Ended February 1, 2020 Operating cash flows from operating leases $ (49,713) Cash paid for amounts included in the measurement of lease liabilities - operating leases (49,713) As of February 1, 2020 Right-of-use assets obtained in exchange for new or remeasured operating lease liabilities $ 66,095 Weighted-average remaining lease term - operating leases Weighted-average discount rate - operating leases In accordance with ASC 842, maturities of operating lease liabilities as of February 1, 2020 were as follows: Operating Year Endings: Leases 2020 $ 54,380 2021 51,524 2022 47,363 2023 42,700 2024 34,859 Thereafter 130,263 Undiscounted cash flows $ 361,089 Reconciliation of lease liabilities: Present values $ 251,741 Lease liabilities - current 34,487 Lease liabilities - noncurrent 217,254 Lease liabilities - total $ 251,741 Difference between undiscounted and discounted cash flows $ 109,348 The Company has excluded in the table above approximately $11.6 million of leases (undiscounted basis) that have not yet commenced. These leases will commence in 2020 with lease terms of five to ten years . In accordance with ASC 840, rent expense for operating leases consisted of the following: Fiscal Year Ended February 2, 2019 Operating lease expense $ 54,027 Total lease expense 54,027 In accordance with ASC 840, future minimum lease payments under non-cancelable leases as of February 2, 2019 were as follows: Operating Year Endings: Leases 2019 $ 47,551 2020 46,824 2021 43,070 2022 38,160 2023 33,246 Thereafter 74,821 Total minimum lease payments $ 283,672 |
Accrued Expenses and Other Liab
Accrued Expenses and Other Liabilities | 12 Months Ended |
Feb. 01, 2020 | |
Accrued Expenses and Other Liabilities | |
Accrued Expenses and Other Liabilities | (7) Accrued Expenses and Other Liabilities Accrued expenses and other liabilities consist of the following at February 1, 2020 and February 2, 2019: February 1, February 2, 2020 2019 Book overdraft $ 15,827 $ 10,297 Unearned revenue 25,705 21,836 Accrued payroll and related expenses 11,436 11,590 Sales and use tax payable 5,169 4,250 Accrued construction costs 1,112 760 Other 10,869 7,651 Total accrued expenses $ 70,118 $ 56,384 |
Revolving Line of Credit
Revolving Line of Credit | 12 Months Ended |
Feb. 01, 2020 | |
Revolving Line of Credit | |
Revolving Line of Credit | (8) Revolving Line of Credit On May 23, 2018, Sportsman’s Warehouse, Inc. (“SWI”), a wholly owned subsidiary of the Company, as lead borrower, and Wells Fargo Bank, National Association (“Wells Fargo”), with a consortium of banks led by Wells Fargo, entered into an Amended and Restated Credit Agreement (as amended, restated, supplemented or otherwise modified, the “Amended Credit Agreement”). The Amended Credit Agreement governs the Company’s senior secured revolving credit facility (“Revolving Line of Credit”) and a $40,000 term loan (the “Term Loan”). The Revolving Line of Credit provides a borrowing capacity of up to $250,000, subject to a borrowing base calculation. Information on the Term Loan is provided in Note 9. In conjunction with the Amended Credit Agreement, the Company incurred $1,331 of fees paid to various parties which were capitalized. Fees associated with the Revolving Line of Credit were recorded in prepaid and other assets. Fees associated with the Term Loan offset the loan balance on the consolidated balance sheet of the Company. As of February 1, 2020, and February 2, 2019, the Company had $ 123,478 and $151,341, 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 type arrangements, which were $7,400 and $7,035 as of February 1, 2020 and February 2, 2019, respectively. As of February 1, 2020, the Company had stand-by commercial letters of credit of $1,705 under the terms of the Revolving Line of Credit. In addition, on March 13, 2020, the Company borrowed an additional $1,075 under the Revolving Line of Credit to fund the purchase of one additional Field & Stream store. See Note 19, Subsequent Event for additional information. 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 Amended 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 0.75% 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 1, 2020 was 3.07%. 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 Amended Credit Agreement 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 Amended Credit Agreement also requires us to maintain a minimum availability at all times of not less than 10% of the gross borrowing base. The Amended Credit Agreement also contains customary events of default. The Revolving Line of Credit matures on May 23, 2023. Each of the subsidiaries of Holdings is a borrower under the Revolving Line of Credit, and all obligations under the Revolving Line of Credit are guaranteed by Holdings. All of the obligations under the Revolving Line of Credit are secured by a lien on substantially all of the Holdings’ tangible and intangible assets and the tangible and intangible assets of all of Holdings’ subsidiaries, including a pledge of all capital stock of each of Holdings’ subsidiaries. The lien securing the obligations under the Revolving Line of Credit is a first priority lien as to certain liquid assets, including cash, accounts receivable, deposit accounts and inventory. As of February 1, 2020, and February 2, 2019 the Amended Credit Agreement had $834 and $1,085, respectively in outstanding deferred financing fees. During the fiscal year ended February 1, 2020 and February 2, 2019, the Company recognized $251 and $195, respectively, of non-cash interest expense with respect to the amortization of deferred financing fees. During the fiscal year ended February 3, 2018, the Company recognized $131 of non-cash interest expense with respect to the amortization of deferred financing fees. As of February 1, 2020, February 2, 2019, and February 3, 2018, gross borrowings under the Revolving Line of Credit were $958,869, $1,023,983, and $909,180, respectively. As of February 1, 2020, February 2, 2019, and February 3, 2018, gross paydowns under the Revolving Line of Credit were $994,666, $950,143, and $912,792, respectively. |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Feb. 01, 2020 | |
Long-Term Debt | |
Long-Term Debt | (9) Long-Term Debt Long-term debt consisted of the following as of February 1, 2020 and February 2, 2019: February 1, February 2, 2020 2019 Term loan 30,000 36,000 Less debt issuance costs (283) (368) 29,717 35,632 Less current portion, net of discount and debt issuance costs (5,936) (7,915) Long-term portion $ 23,781 $ 27,717 Term Loan On May 23, 2018, Sportsman’s Warehouse, a wholly owned subsidiary of Holdings, as lead borrower, and Wells Fargo, with a consortium of banks led by Wells Fargo, entered into the Amended Credit Agreement. The Amended Credit Agreement governs the Revolving Line of Credit and the Term Loan. The Term Loan was issued at a price of 100% of the aggregate principal amount of $40,000 and has a maturity date of May 23, 2023. Information on the Revolving Credit Facility is provided in Note 8. The Term Loan bears interest at a rate of LIBOR plus 5.75%. The effective rate for the New Term Loan as of February 1, 2020 was 7.31% Each of the subsidiaries of Holdings is a borrower under the Term Loan, and all obligations under the Term Loan are guaranteed by Holdings. All of the obligations under the Term Loan are secured by a lien on substantially all of the Holdings’ tangible and intangible assets and the tangible and intangible assets of all of Holdings’ subsidiaries, including a pledge of all capital stock of each of Holdings’ subsidiaries. The lien securing the obligations under the Term Loan is a first priority lien as to certain liquid assets, including cash, accounts receivable, deposit accounts and inventory. The Term Loan requires quarterly principal payments of $2,000 which began November 1, 2018 and continue until the balance is $24,000 at which time no further payments are needed until May 23, 2023, at which time the remaining balance is due in full. 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. As of February 1, 2020, the Company was in compliance with all of the covenants of the Term Loan. As of February 1, 2020, and February 2, 2019, the Term Loan had an outstanding balance of $30,000 and $36,000. The outstanding amounts as of February 1, 2020 and February 2, 2019 are offset on the consolidated balance sheets by debt issuance costs of $283 and $368, respectively. During fiscal year 2019, the Company recognized $85 of non-cash interest expense with respect to the amortization of the deferred financing fees. During fiscal year 2018, the Company recognized $678 and $1,173 of non-cash interest expense with respect to the amortization of the discount and deferred financing fees. 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 1, 2020, 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. 01, 2020 | |
Leases | |
Sale Leaseback Transactions | (10) Sale Leaseback Transactions During the fiscal years ended February 1, 2020, February 2, 2019, and February 3, 2018, the Company completed deemed sale-leaseback and sale-leaseback transactions of the land and buildings associated with one, one, and four, store or corporate office locations, respectively. In each of the related lease agreements for the deemed sale leaseback 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 the owner of the land and building during the construction period. The sale occurred when the construction of the assets was substantially 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 assets were considered leasehold improvements. For the sale leaseback transaction, the Company was the owner of the building and paid all construction costs directly. Once construction was deemed complete and occupancy permits were obtained, the Company sold the building and rights to the constructed assets to the landlord for a predetermined amount and were written off the Company’s books. Any remaining assets were considered leasehold improvements or property and equipment. The total value of tenant allowances received under these transactions during fiscal years 2019, 2018, and 2017, was $9,533, $1,717, and $9,022, respectively. |
Common Stock
Common Stock | 12 Months Ended |
Feb. 01, 2020 | |
Secondary Offering | |
Common Stock | (11) 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. 01, 2020 | |
Earnings Per Share | |
Earnings Per Share | (12) Earnings Per Share Basic earnings per share is calculated by dividing net income by the weighted-average number of shares of common stock outstanding, during the period. Diluted earnings per share represents basic earnings per share adjusted to include the potentially dilutive effect of 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 1, February 2, February 3, 2020 2019 2018 Net income $ 20,215 $ 23,750 $ 17,742 Weighted-average shares of common stock outstanding: Basic 43,166 42,878 42,496 Dilutive effect of common stock equivalents 422 101 26 Diluted 43,588 42,979 42,522 Basic earnings per share $ 0.47 $ 0.55 $ 0.42 Diluted earnings per share $ 0.46 $ 0.55 $ 0.42 Restricted stock units considered anti-dilutive and excluded in the calculation 4 56 191 |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Feb. 01, 2020 | |
Stock-Based Compensation | |
Stock-Based Compensation | (13) 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 $2,104, $2,829, and $2,294, during fiscal years 2019, 2018, and 2017, 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 1, 2020, and February 2, 2019, respectively, the Company had $3,966 and $2,692 remaining in unrecognized compensation costs, respectively. Employee Stock Plans As of February 1, 2020, the number of shares available for awards under the 2019 Performance Incentive Plan (the “2019 Plan”) was 3,169. As of February 1, 2020, there were 956 awards outstanding under the 2019 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 2019 Plan. Nonvested Restricted Stock Awards During the fiscal years 2019 and 2018, the Company did not issue any nonvested restricted stock awards to employees. 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 February 2, 2019 26 $ 11.25 Grants — — Forfeitures — — Vested (26) 11.25 Balance at February 1, 2020 — $ — Weighted average grant-date Shares fair value Balance at February 3, 2018 108 $ 11.25 Grants — — Forfeitures (2) 11.25 Vested (80) 11.25 Balance at February 2, 2019 26 $ 11.25 Nonvested Performance-Based Stock Awards During fiscal year 2019, the Company issued 289 nonvested performance-based stock awards to employees at a weighted average grant date fair value of $3.53 per share. The nonvested performance-based stock awards issued to employees vest at the end of three years. The number of shares issued is contingent on management achieving a fiscal year 2019 performance target for same store sales and gross margin. Based on the performance conditions met for 2019, the finalized granted awards were 226 as presented in the table below. During fiscal year 2018, the Company issued 163 nonvested performance-based stock awards to employees at a weighted average grant date fair value of $4.91 per share. The nonvested performance-based stock awards issued to employees vest at the end of three years. The number of shares issued was contingent on management achieving a fiscal year 2018 performance target for same store sales and gross margin. Based on the performance conditions met for 2018, the finalized granted awards were 36 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 February 2, 2019 34 $ 6.07 Grants 226 3.53 Forfeitures (3) 4.91 Vested (7) 11.25 Balance at February 1, 2020 250 $ 3.66 Weighted average grant-date Shares fair value Balance at February 3, 2018 49 $ 11.25 Grants 36 4.91 Forfeitures (5) 5.36 Vested (46) 11.25 Balance at February 2, 2019 34 $ 6.07 Nonvested Stock Unit Awards During the fiscal year 2019, the Company issued 638 nonvested stock units to employees of the Company and independent members of the Board of Directors at a weighted average grant date fair value of $4.13 per share. 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 the fiscal year 2018, the Company issued 330 nonvested stock units to employees of the Company and independent members of the Board of Directors at a weighted average grant date fair value of $4.89 per share. 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. The following table sets forth the rollforward of outstanding nonvested stock units: Weighted average grant-date Shares fair value Balance at February 2, 2019 441 $ 4.92 Grants 638 4.13 Forfeitures (66) 5.08 Vested (269) 4.67 Balance at February 1, 2020 744 $ 4.32 Weighted average grant-date Shares fair value Balance at February 3, 2018 419 $ 5.15 Grants 330 4.89 Forfeitures (8) 4.91 Vested (300) 5.23 Balance at February 2, 2019 441 $ 4.92 As of February 1, 2020, and February 2, 2019, the weighted average grant date fair value of the outstanding shares was $4.32 and $4.92, respectively. |
Employee Stock Purchase Plan
Employee Stock Purchase Plan | 12 Months Ended |
Feb. 01, 2020 | |
Stock-Based Compensation | |
Employee Stock Purchase Plan | (14) 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 2019, 2018, and 2017 was $133, $143, and $160, respectively. 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 1, 2020 February 2, 2019 Risk-free interest rate Expected life (in years) 0.5 0.5 Expected volatility Dividend yield — — |
Income Taxes
Income Taxes | 12 Months Ended |
Feb. 01, 2020 | |
Income Taxes | |
Income Taxes | (15) Income Taxes For the fiscal years ended February 1, 2020, February 2, 2019, and February 3, 2018, the income tax provision consisted of the following: February 1, February 2, February 3, 2020 2019 2018 Current: Federal $ 4,004 $ 4,630 $ 12,718 State 540 1,719 1,868 Total current 4,544 6,349 14,586 Deferred: Federal 1,246 598 780 State (536) 116 (278) Total deferred 710 714 502 Total income tax provision $ 5,254 $ 7,063 $ 15,088 The provision for income taxes differs from the amounts computed by applying the federal statutory rate as follows for the following periods: February 1, February 2, February 3, 2020 2019 2018 Federal statutory rate 21.0 % 21.0 % 33.7 % State tax, net of federal benefit 1.5 4.1 3.8 Permanent items 1.1 2.5 2.0 Other items (0.2) (0.4) (0.2) Tax credits (2.8) — — Tax reform adjustment — (4.3) 6.7 Effective income tax rate 20.6 % 22.9 % 46.0 % The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at February 1, 2020 and February 2, 2019, respectively, are presented below: February 1, February 2, 2020 2019 Deferred tax assets: Accrued liabilities $ 558 $ 453 Operating lease liability 63,187 — Gift card liability 289 — Goodwill 835 — Deferred rent — 11,835 Intangible asset 1,224 1,374 Inventories 1,452 1,940 Sales return reserve 208 185 Capital loss carryforward 39 39 Stock-based compensation 403 290 Loyalty program 2,415 2,191 Total gross deferred tax assets $ 70,610 $ 18,307 Deferred tax liabilities: Depreciation $ (15,020) $ (14,670) ROU asset (55,272) — Prepaid expenses (836) (553) Gift card escheatment (44) (87) Total gross deferred tax liabilities $ (71,172) $ (15,310) Net deferred tax asset (liability) $ (562) $ 2,997 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. As a result of the Tax Act, the Company 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. Pursuant to Staff Accounting Bulletin 118, the Company was 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 did not have any provisional estimates associated with the Tax Act and therefore, did not record any adjustments relating to the Tax Act. For the year ended February 2, 2019, the Company recorded a discrete net benefit of $1,300 related to Tax Reform. This was a result of certain accounting method changes and other permitted timing adjustments that were ultimately reflected on the Company’s fiscal 2017 tax return filed in fiscal 2018 resulting in a net benefit due to changes in the federal tax rates under the Tax Act. 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 1, 2020, 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 1, 2020, 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 1, 2015 through February 2, 2019. 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. No interest or penalties were accrued for fiscal year 2019 or fiscal year 2018. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Feb. 01, 2020 | |
Commitments and Contingencies. | |
Commitments and Contingencies | (16) Commitments and Contingencies 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. Parsons v. Colt’s Manufacturing Company , 2:19-cv-01189-APG-EJY – On July 2, 2019 the estate and family of a victim of the Route 91 Harvest Festival shooting filed litigation against 16 defendants, one of which being a subsidiary of Sportsman’s Warehouse Holdings, Inc., for wrongful death and negligence. The Company believes the plaintiffs’ attempts to re-interpret the federal National Firearms Act and Gun Control Act are improper and intend to vigorously defend ourselves in the matter. No reasonable estimate of the amount of any potential losses or range of potential losses relating to this matter can be determined at this time. |
Related-Party Transactions
Related-Party Transactions | 12 Months Ended |
Feb. 01, 2020 | |
Related-Party Transactions | |
Related Party Transactions | (17) 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 1, 2020, February 2, 2019, and February 3, 2018, the Company made no significant payments to these related parties. At February 1, 2020 and February 2, 2019, there were no amounts payable under the terms of this agreement. |
Retirement Plan
Retirement Plan | 12 Months Ended |
Feb. 01, 2020 | |
Retirement Plan | |
Retirement Plan | (18) 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 $835, $572, and $390, for the fiscal years ended February 1, 2020, February 2, 2019, and February 3, 2018, respectively. |
Subsequent Event
Subsequent Event | 12 Months Ended |
Feb. 01, 2020 | |
Subsequent Event | |
Subsequent Event | (19) Subsequent Event On February 14, 2020, Sportsman’s Warehouse entered into an Asset Purchase Agreement (the “February Purchase Agreement ”) with DICK’S. Pursuant to the February Purchase Agreement, Sportsman’s Warehouse agreed to acquire from DICK’S all cash, inventory, furniture, fixtures, and equipment, and certain other assets related to one Field & Stream store located in Kentucky operated by DICK’S (the “Acquired Kentucky Store”). The February Purchase Agreement is on substantially similar terms to those contained in the Purchase Agreement related to the Acquired Stores in fiscal year 2019. See Note 3 for additional information. The acquisition of the Acquired Kentucky Store closed on March 13, 2020 and the $2.1 million purchase price was funded through borrowings under the Company’s Revolving Line of Credit. The purchase price is also subject to certain post-closing adjustments set forth the February Purchase Agreement and 50% of the agreed upon inventory value of the Acquired Kentucky Store will be paid within 90 days after the closing date. On March 6, 2020, Sportsman’s Warehouse, Inc. entered into an Asset Purchase Agreement (the “March Purchase Agreement”) with DICK’S. Pursuant to the March Purchase Agreement, Sportsman’s Warehouse agreed to acquire from DICK’S all cash, inventory, furniture, fixtures, and equipment, and certain other assets related to one Field & Stream store located in Michigan operated by DICK’S (the “Acquired Michigan Store”). The March Purchase Agreement is on substantially similar terms to those contained in the Purchase Agreement related to the Acquired Stores in fiscal year 2019. See Note 3 for additional information. The acquisition of the Acquired Michigan Store has not closed as of the date of this Form 10-K due to the COVID-19 pandemic The purchase price will be funded through borrowings under the Company’s Revolving Line of Credit. The purchase price will also be subject to certain post-closing adjustments set forth the March Purchase Agreement and 50% of the agreed upon inventory value of the Acquired Michigan Store will be paid within 90 days after the closing date. During March 2020, the World Health Organization declared the rapidly growing coronavirus outbreak to be a global pandemic. The COVID-19 pandemic has significantly impacted health and economic conditions throughout the United States. Beginning in March 2020, we reduced store hours to allow sufficient time to restock our shelves and perform additional cleaning, and we also have limited the number of customers in our stores at any one time. Currently, 3 of our 106 stores have been closed and 8 of our 106 stores have significant restrictions as a result of local and state regulations. We may further restrict the operations of our stores and our distribution facility if we deem this necessary or if recommended or mandated by authorities. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Feb. 01, 2020 | |
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 Year | Fiscal Year The Company operates using a 52/53 week fiscal year ending on the Saturday closest to January 31. Fiscal year 2019 ended February 1, 2020 and contained 52 weeks of operation. Fiscal year 2018 ended February 2, 2019 and contained 52 weeks of operations. Fiscal year 2017 ended February 3, 2018 and contained 53 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 operating accounts 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 or similar 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 1, 2020 and February 2, 2019, the combined balance in these accounts was $7,400 and $7,035, respectively. Accordingly, these amounts have been classified as a reduction in the line of credit as if the transfers had occurred on February 1, 2020 and February 2, 2019, 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 1, 2020 and February 2, 2019, the Company had no allowance for doubtful accounts receivable. |
Merchandise Inventories | Merchandise Inventories The Company measures its inventory at the lower of cost or net realizable value. 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 write downs for shrinkage, damage, or obsolescence totaled $5,761 and $7,012 at February 1, 2020 and February 2, 2019, 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 1, 2020, February 2, 2019, and February 3, 2018. |
Goodwill | Goodwill At least annually, during the fourth quarter, or when events and circumstances warrant an evaluation, the Company performs its impairment assessment of goodwill. This assessment permits an entity to initially perform a qualitative assessment of whether it is more likely than not that a reporting unit’s fair value is less than its carrying amount before applying the quantitative goodwill impairment test. If an entity concludes that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, it would not need to perform the impairment test for the reporting unit. If it is determined that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the impairment analysis is performed, which incorporates a fair-value based approach. The Company determines the fair value of its reporting units based on discounted cash flows and market approach analyses as considered necessary. The Company considers factors such as the economy, reduced expectations for future cash flows coupled with a decline in the market price of its stock and market capitalization for a sustained period as indicators for potential goodwill impairment. If the reporting unit’s carrying amount exceeds its fair value, the Company will record an impairment charge based on that difference. The impairment charge will be limited to the amount of goodwill allocated to that reporting unit. No impairment charge to goodwill was recorded during the fiscal year ended February 1, 2020. |
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. |
Leases | Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842), which requires lessees to recognize on the balance sheet assets and liabilities for leases with lease terms of more than 12 months. Consistent with prior GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee will depend primarily on its classification as a finance or operating lease. However, unlike prior GAAP—which required only finance (formerly capital) leases to be recognized on the balance sheet—the new ASU requires both types of leases to be recognized on the balance sheet. The ASU took effect for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. This standard could be applied at the beginning of the earliest period presented using the modified retrospective approach, which includes certain practical expedients that an entity may elect to apply, including an election to use certain transition relief. In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases and ASU No. 2018-11, Leases (Topic 842): Targeted Improvements, which made improvements to Accounting Standards Codification (“ASC”) 842 and allow entities to not restate comparative periods in transition to ASC 842 and instead report the comparative periods under ASC 840 . The Company adopted ASC 842 using the modified retrospective approach on February 3, 2019, coinciding with the standard’s effective date. In accordance with ASC 842, the Company did not restate prior comparative periods in transition to ASC 842 and instead reported prior comparative periods under ASC 840. Adoption of the standard resulted in the initial recognition of operating lease right-of-use (“ROU”) assets of $183,000 and operating lease liabilities of $214,000 as of February 3, 2019. These amounts were based on the present value of such commitments as of February 3, 2019 using the Company’s incremental borrowing rate (“IBR”), which was determined through use of the Company’s credit rating to develop a rate curve that approximates the Company’s market risk profile. The adoption of this standard had a material impact on the Company’s consolidated statement of income, balance sheet, stockholders’ equity and cash flows, with a $9,300 net adjustment recorded to beginning retained earnings on February 3, 2019 due to the acceleration of recognition of a deferred gain and derecognition of the related deferred tax asset the Company was amortizing relating to the historical sale and lease back of owned properties. In addition, the Company completed its evaluation of the practical expedients offered and enhanced disclosures required in ASC 842, as well as reviewed arrangements to identify embedded leases, among other activities, to account for the adoption of this standard. The Company elected the following practical expedients: · A package of practical expedients allowing the Company to: 1. Carry forward its historical lease classification (i.e. it was not necessary to reclassify any existing leases at the adoption date of ASC 842), 2. Avoid reassessing whether any expired or existing contracts are or contain leases, and 3. Avoid reassessing initial indirect costs for any existing lease. · A practical expedient allowing the Company to not separate lease components (e.g. fixed payments including, rent, real estate taxes, and insurance costs) from nonlease components (e.g. common area maintenance costs), primarily impacting the Company’s real estate leases. The election of this practical expedient eliminates the burden of separately estimating the real estate lease and nonlease costs on a relative stand-alone basis. · A practical expedient related to land easements, allowing the Company to carry forward the accounting treatment for land easements on existing agreements and eliminated the need to reassess existing lease contracts to determine if land easements are separate leases under ASC 842. The Company did not elect a practical expedient which would allow the Company to use hindsight in determining the lease term (that is, when considering lessee options to extend or terminate the lease and to purchase the underlying asset) and to assess impairment of the entity’s ROU assets, since election of this expedient could make adoption of ASC 842 more complex given that re-evaluation of the lease term and impairment consideration affect other aspects of lease accounting. In accordance with ASC 842, the Company determines if an arrangement is a lease at inception. The Company has operating leases for the Company’s retail stores, distribution center, and corporate office. Operating leases are included in operating lease ROU assets and operating lease liabilities, current and noncurrent, on the consolidated balance sheet. Lease liabilities are initially recorded at the present value of the lease payments by discounting the lease payments by the IBR and then recording accretion over the lease term using the effective interest method. Operating lease classification results in a straight-line expense recognition pattern over the lease term and recognized lease expense as a single expense component, which results in amortization of the ROU asset that equals the difference between lease expense and interest expense. Operating lease expense is included in selling, general and administrative expense, based on the use of the leased asset, on the consolidated statement of income. Leases with an initial term of 12 months or less are not recorded on the balance sheet and are not material; the Company recognizes lease expense for these leases on a straight-line basis over the remaining lease term. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the reasonably certain lease term. As the Company’s leases generally do not provide an implicit rental rate, the Company uses an IBR to determine the present value of future rental payments. The IBR is determined by using the Company’s credit rating to develop a yield curve that approximates the Company’s market risk profile. The operating lease ROU asset also includes any prepaid lease payments made by the tenant and is reduced by lease incentives such as tenant improvement allowances. The operating lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense is recognized on a straight-line basis over the lease term. For fiscal 2018, the Company evaluated and classified its leases as operating leases for financial reporting purposes, in accordance with ASC 840. In accordance with ASC 840, deferred rent represents the difference between rent paid and amounts expensed for operating leases. Certain leases have scheduled rent increases, and certain leases include an initial period of free or reduced rent as an inducement to enter into the lease agreement (“rent holidays”). The Company recognized rent expense for rent increases and rent holidays on a straight-line basis over the term of the underlying leases, without regard to when rent payments are made. The calculation of straight-line rent begins on the possession date and extends through the “reasonably assured” lease term as defined in ASC 840. Additionally, in accordance with ASC 840, landlord allowances for tenant improvements, or lease incentives, were recorded as deferred rent and amortized on a straight-line basis over the “reasonably assured” lease term as a component of rent expense. See Note 6 for a further discussion on leases. |
Revenue Recognition | Revenue Recognition Revenue recognition accounting policy The Company operates solely as an outdoor retailer, which includes both retail stores and an e-commerce platform, that offers a broad range of products in the United States and online. Generally, all revenues are recognized when control of the promised goods is transferred to customers, in an amount that reflects the consideration in exchange for those goods. Accordingly, the Company implicitly enters into a contract with customers to deliver merchandise inventory at the point of sale. Collectability is reasonably assured since the Company only extends immaterial credit purchases to certain municipalities. Substantially all of the Company’s revenue is for single performance obligations for the following distinct items: · Retail store sales · E-commerce sales · Gift cards and loyalty rewards program For performance obligations related to retail store and e-commerce sales contracts, the Company typically transfers control, for retail stores, upon consummation of the sale when the product is paid for and taken by the customer and, for e-commerce sales, when the products are tendered for delivery to the common carrier. The transaction price for each contract is the stated price on the product, reduced by any stated discounts at that point in time. The Company does not engage in sales of products that attach a future material right which could result in a separate performance obligation for the purchase of goods in the future at a material discount. The implicit point-of-sale contract with the customer, as reflected in the transaction receipt, states the final terms of the sale, including the description, quantity, and price of each product purchased. Payment for the Company’s contracts is due in full upon delivery. The customer agrees to a stated price implicit in the contract that does not vary over the contract. The transaction price relative to sales subject to a right of return reflects the amount of estimated consideration to which the Company expects to be entitled. This amount of variable consideration included in the transaction price, and measurement of net sales, is included in net sales only to the extent that it is probable that there will be no significant reversal in a future period. Actual amounts of consideration ultimately received may differ from the Company’s estimates. The allowance for sales returns is estimated based upon historical experience and a provision for estimated returns is recorded as a reduction in sales in the relevant period. The estimated merchandise inventory cost related to the sales returns is recorded in prepaid expenses and other. The estimated refund liabilities are recorded in accrued expenses. If actual results in the future vary from the Company’s estimates, the Company adjusts these estimates, which would affect net sales and earnings in the period such variances become known. Contract liabilities are recognized primarily for gift card sales and our loyalty reward program. Cash received from the sale of gift cards is recorded as a contract liability in accrued expenses, and the Company recognizes revenue upon the customer’s redemption of the gift card. Gift card breakage is recognized as revenue in proportion to the pattern of customer redemptions by applying a historical breakage rate of 3.5% when no escheat liability to relevant jurisdictions exists. Based upon historical experience, gift cards are predominantly redeemed in the first two years following their issuance date. The Company does not sell or provide gift cards that carry expiration dates. ASC 606 requires the Company to allocate the transaction price between the goods and the loyalty reward points based on the relative stand alone selling price. The Company recognized revenue for the breakage of loyalty reward points as revenue in proportion to the pattern of customer redemption of the points by applying a historical breakage rate of 50% when no escheat liability to relevant jurisdictions exists. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue. Sales returns The Company allows customers to return items purchased within 30 days provided the merchandise is in resaleable condition with original packaging and the original sales/gift receipt is presented. We estimate a reserve for sales returns and record the respective reserve amounts, including a right to return asset when a product is expected to be returned and resold. Historical experience of actual returns and customer return rights are the key factors used in determining the estimated sales returns. Contract Balances The following table provides information about right of return assets, contract liabilities, and sales return liabilities with customers as of fiscal year ended February 1, 2020 and Februrary 2, 2019: February 1, 2020 February 2, 2019 Right of return assets, which are included in prepaid expenses and other $ 1,683 $ 1,496 Estimated gift card contract liability, net of breakage (13,575) (11,569) Estimated loyalty contract liability, net of breakage (9,621) (8,729) Sales return liabilities, which are included in accrued expenses (2,512) (2,233) For the fiscal years ended February 1, 2020, February 2, 2019, and February 3, 2018, the Company recognized $1,430, $1,007, and $1,337 in gift card breakage, respectively. For the fiscal years ended February 1, 2020, February 2, 2019, and February 3, 2018, the Company recognized $2,480, $1,439, and $1,022, in loyalty reward breakage, respectively. The impact of these adjustments on the statement of cash flow for the year ended February 1, 2020 were recorded in cash provided by operating activities. For the fiscal years ended February 1, 2020 and February 2, 2019 the Company recognized $8,219 and $8,802 of revenue related to the beginning gift card liability from the previous year. The current balance of the right of return assets is the expected amount of inventory to be returned that is expected to be resold. The current balance of the contract liabilities primarily relates to the gift card and loyalty reward program liabilities. The Company expects the revenue associated with these liabilities to be recognized in proportion to the pattern of customer redemptions over the next two years. The current balance of sales return liabilities is the expected amount of sales returns from sales that have occurred. Practical expedients and policy elections The Company applied the following practical expedients in its application for Topic 606: · The Company elected to apply the practical expedient, relative to e-commerce sales, which allows an entity to account for shipping and handling as fulfillment activities, and not a separate performance obligation. Accordingly, the Company recognizes revenue for only one performance obligation, the sale of the product, at the shipping point (when the customer gains control). Revenue associated with shipping and handling is not material. The costs associated with fulfillment are recorded in costs of goods sold. · The Company elected to apply the practical expedient, relative to sales tax collected, which allows an entity to exclude from its transaction price any amounts collected from customers for all sales (and other similar) taxes. Disaggregation of revenue from contracts with customers In the following table, revenue from contracts with customers is disaggregated by department. The percentage of net sales related to our departments for the fiscal years ended February 1, 2020, February 2, 2019, and February 3, 2018, were as follows: Fiscal Year Ended February 1, February 2, February 3, Department Product Offerings 2020 2019 2018 Camping Backpacks, camp essentials, canoes and kayaks, coolers, outdoor cooking equipment, sleeping bags, tents and tools Clothing Camouflage, jackets, hats, outerwear, sportswear, technical gear and work wear Fishing Bait, electronics, fishing rods, flotation items, fly fishing, lines, lures, reels, tackle and small boats Footwear Hiking boots, socks, sport sandals, technical footwear, trail shoes, casual shoes, waders and work boots Hunting and Shooting Ammunition, archery items, ATV accessories, blinds and tree stands, decoys, firearms, reloading equipment and shooting gear Optics, Electronics, Accessories, and Other Gift items, GPS devices, knives, lighting, optics (e.g. binoculars), two-way radios, and other license revenue, net of revenue discounts Total The Company adopted Accounting Standard Codification (“ASC”) Topic 606 on February 4, 2018, using the modified retrospective approach to all open contracts, with the cumulative effect of adopting the new standard being recognized in retained earnings at February 4, 2018. Therefore, the prior periods comparative information has not been adjusted and continues to be reported under Topic 605. The adoption of Topic 606 resulted in an increase in prepaid expenses and other assets of $1,054 for the recognition of the right of return assets; an increase in accrued expenses relating to the sales return liability of $1,054 for the recognition of the sales return liability on a gross basis; a decrease in accrued expenses of $3,521 relating to the breakage of loyalty rewards and gift cards in order to adjust the breakage pattern of the loyalty program and gift cards to match the usage; a decrease of $884 in deferred tax assets relating to the tax impact of the entries recorded for the gift card and loyalty program liabilities; and a decrease in accumulated deficit of $2,634 as a cumulative effect of the adoption. The largest driver of changes for the adoption of Topic 606 was the change in the method of estimating breakage for the Company’s outstanding gift cards and loyalty reward liabilities. Under Topic 605, this breakage was historically recorded when it was determined that the gift cards or loyalty reward points were not probable to be redeemed, which was after two years for gift cards and 18 months for loyalty reward points. Topic 606, the breakage recognized for the loyalty reward program and gift cards is now estimated based off of historical breakage percentages, and is recognized in-line with the expected usage of the loyalty points and gift cards. |
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. |
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 1, 2020, and February 2, 2019, the Company estimated the IBNR for this plan to be $945 and $900, 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 1, 2020, and February 2, 2019, the Company estimated the IBNR for this plan to be $902 and $1,045, 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 1, 2020, February 2, 2019, and February 3, 2018, net advertising expenses totaled $11,493, $8,437, and $7,760, 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 As of February 1, 2020, and February 2, 2019 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. |
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 1, 2020, February 2, 2019, and February 3, 2018. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In August 2018, the FASB issued ASU No. 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract . This standard aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The Company’s accounting for the service element of a hosting arrangement that is a service contract is not affected by the proposed amendments and will continue to be expensed as incurred in accordance with existing guidance. This standard does not expand on existing disclosure requirements except to require a description of the nature of hosting arrangements that are service contracts. This standard is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted, including adoption in any interim period for which financial statements have not been issued. Entities can choose to adopt the new guidance prospectively or retrospectively. The Company plans to adopt the updated disclosure requirements of ASU No. 2018-15 prospectively in the first quarter of fiscal 2020, coinciding with the standard’s effective date, and expects the impact from this standard to be immaterial. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Feb. 01, 2020 | |
Summary of Significant Accounting Policies | |
Schedule of right of return assets, contract liabilities, and sales return liabilities with customers | February 1, 2020 February 2, 2019 Right of return assets, which are included in prepaid expenses and other $ 1,683 $ 1,496 Estimated gift card contract liability, net of breakage (13,575) (11,569) Estimated loyalty contract liability, net of breakage (9,621) (8,729) Sales return liabilities, which are included in accrued expenses (2,512) (2,233) |
Schedule of Revenue by Departments | Fiscal Year Ended February 1, February 2, February 3, Department Product Offerings 2020 2019 2018 Camping Backpacks, camp essentials, canoes and kayaks, coolers, outdoor cooking equipment, sleeping bags, tents and tools Clothing Camouflage, jackets, hats, outerwear, sportswear, technical gear and work wear Fishing Bait, electronics, fishing rods, flotation items, fly fishing, lines, lures, reels, tackle and small boats Footwear Hiking boots, socks, sport sandals, technical footwear, trail shoes, casual shoes, waders and work boots Hunting and Shooting Ammunition, archery items, ATV accessories, blinds and tree stands, decoys, firearms, reloading equipment and shooting gear Optics, Electronics, Accessories, and Other Gift items, GPS devices, knives, lighting, optics (e.g. binoculars), two-way radios, and other license revenue, net of revenue discounts Total |
Acquisition of Field and Stre_2
Acquisition of Field and Stream Stores (Tables) | 12 Months Ended |
Feb. 01, 2020 | |
Acquisition of Field and Stream Stores | |
Summary of the purchase price consideration and related cash outflow | October 11, 2019 Cash paid to seller $ 19,241 Payable to seller 9,462 Total purchase price $ 28,703 |
Summary of the estimated fair value of the identifiable assets acquired and assumed liabilities as of the Closing Date | October 11, 2019 Cash $ 167 Inventory 19,152 Property, plant, and equipment 5,250 Operating lease right of use asset 33,436 Operating lease right of use liability (31,051) Deferred tax asset 253 Goodwill 1,496 Total $ 28,703 |
Summary of pro forma information | Fiscal Year Ended February 1, February 2, 2020 2019 Net sales $ 931,703 923,678 Net income $ 20,369 26,624 Earnings per share: Basic $ 0.47 0.62 Diluted $ 0.47 0.62 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Feb. 01, 2020 | |
Property and Equipment. | |
Schedule of Property and Equipment | February 1, February 2, 2020 2019 Furniture, fixtures, and equipment $ 84,059 $ 71,820 Leasehold improvements 103,791 94,573 Construction in progress 1,571 1,743 Total property and equipment, gross 189,421 168,136 Less accumulated depreciation and amortization (90,654) (76,052) Total property and equipment, net $ 98,767 $ 92,084 |
Definite Lived Intangible Ass_2
Definite Lived Intangible Assets (Tables) | 12 Months Ended |
Feb. 01, 2020 | |
Definite Lived Intangible Asset | |
Summary of Definite Lived Intangible Assets | February 1, 2020 Amortization period Gross carrying amount Accumulated amortization Net carrying amount Amortizing intangible assets: Domain Name 10 years 257 (37) 220 Total $ 257 (37) 220 February 2, 2019 Amortization period Gross carrying amount Accumulated amortization Net carrying amount Amortizing intangible assets: Non-compete agreement 5 years $ 9,063 (9,063) - Domain Name 10 years 257 (11) 246 Total $ 9,320 (9,074) 246 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Feb. 01, 2020 | |
Leases | |
Schedule of other information | Fiscal Year Ended February 1, 2020 Operating cash flows from operating leases $ (49,713) Cash paid for amounts included in the measurement of lease liabilities - operating leases (49,713) As of February 1, 2020 Right-of-use assets obtained in exchange for new or remeasured operating lease liabilities $ 66,095 Weighted-average remaining lease term - operating leases Weighted-average discount rate - operating leases |
Schedule of maturities of operating lease liabilities | Operating Year Endings: Leases 2020 $ 54,380 2021 51,524 2022 47,363 2023 42,700 2024 34,859 Thereafter 130,263 Undiscounted cash flows $ 361,089 Reconciliation of lease liabilities: Present values $ 251,741 Lease liabilities - current 34,487 Lease liabilities - noncurrent 217,254 Lease liabilities - total $ 251,741 Difference between undiscounted and discounted cash flows $ 109,348 |
Schedule of rent expense for operating leases in accordance with ASC 840 | Fiscal Year Ended February 2, 2019 Operating lease expense $ 54,027 Total lease expense 54,027 |
Schedule of future minimum lease payments under non-cancelable leases in accordance with ASC 840 | Operating Year Endings: Leases 2019 $ 47,551 2020 46,824 2021 43,070 2022 38,160 2023 33,246 Thereafter 74,821 Total minimum lease payments $ 283,672 |
Accrued Expenses and Other Li_2
Accrued Expenses and Other Liabilities (Tables) | 12 Months Ended |
Feb. 01, 2020 | |
Accrued Expenses and Other Liabilities | |
Components of Accrued Expenses and Other Liabilities | February 1, February 2, 2020 2019 Book overdraft $ 15,827 $ 10,297 Unearned revenue 25,705 21,836 Accrued payroll and related expenses 11,436 11,590 Sales and use tax payable 5,169 4,250 Accrued construction costs 1,112 760 Other 10,869 7,651 Total accrued expenses $ 70,118 $ 56,384 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Feb. 01, 2020 | |
Long-Term Debt | |
Summary of Long-Term Debt | Long-term debt consisted of the following as of February 1, 2020 and February 2, 2019: February 1, February 2, 2020 2019 Term loan 30,000 36,000 Less debt issuance costs (283) (368) 29,717 35,632 Less current portion, net of discount and debt issuance costs (5,936) (7,915) Long-term portion $ 23,781 $ 27,717 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Feb. 01, 2020 | |
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 1, February 2, February 3, 2020 2019 2018 Net income $ 20,215 $ 23,750 $ 17,742 Weighted-average shares of common stock outstanding: Basic 43,166 42,878 42,496 Dilutive effect of common stock equivalents 422 101 26 Diluted 43,588 42,979 42,522 Basic earnings per share $ 0.47 $ 0.55 $ 0.42 Diluted earnings per share $ 0.46 $ 0.55 $ 0.42 Restricted stock units considered anti-dilutive and excluded in the calculation 4 56 191 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Feb. 01, 2020 | |
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 February 2, 2019 26 $ 11.25 Grants — — Forfeitures — — Vested (26) 11.25 Balance at February 1, 2020 — $ — Weighted average grant-date Shares fair value Balance at February 3, 2018 108 $ 11.25 Grants — — Forfeitures (2) 11.25 Vested (80) 11.25 Balance at February 2, 2019 26 $ 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 February 2, 2019 34 $ 6.07 Grants 226 3.53 Forfeitures (3) 4.91 Vested (7) 11.25 Balance at February 1, 2020 250 $ 3.66 Weighted average grant-date Shares fair value Balance at February 3, 2018 49 $ 11.25 Grants 36 4.91 Forfeitures (5) 5.36 Vested (46) 11.25 Balance at February 2, 2019 34 $ 6.07 |
Rollforward of Outstanding Nonvested Stock Units | Weighted average grant-date Shares fair value Balance at February 2, 2019 441 $ 4.92 Grants 638 4.13 Forfeitures (66) 5.08 Vested (269) 4.67 Balance at February 1, 2020 744 $ 4.32 Weighted average grant-date Shares fair value Balance at February 3, 2018 419 $ 5.15 Grants 330 4.89 Forfeitures (8) 4.91 Vested (300) 5.23 Balance at February 2, 2019 441 $ 4.92 |
Employee Stock Purchase Plan (T
Employee Stock Purchase Plan (Tables) | 12 Months Ended |
Feb. 01, 2020 | |
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 1, 2020 February 2, 2019 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. 01, 2020 | |
Income Taxes | |
Provision for Income Taxes | February 1, February 2, February 3, 2020 2019 2018 Current: Federal $ 4,004 $ 4,630 $ 12,718 State 540 1,719 1,868 Total current 4,544 6,349 14,586 Deferred: Federal 1,246 598 780 State (536) 116 (278) Total deferred 710 714 502 Total income tax provision $ 5,254 $ 7,063 $ 15,088 |
Schedule of Federal Statutory Tax Rate | February 1, February 2, February 3, 2020 2019 2018 Federal statutory rate 21.0 % 21.0 % 33.7 % State tax, net of federal benefit 1.5 4.1 3.8 Permanent items 1.1 2.5 2.0 Other items (0.2) (0.4) (0.2) Tax credits (2.8) — — Tax reform adjustment — (4.3) 6.7 Effective income tax rate 20.6 % 22.9 % 46.0 % |
Schedule of Deferred Tax Assets and Liabilities | February 1, February 2, 2020 2019 Deferred tax assets: Accrued liabilities $ 558 $ 453 Operating lease liability 63,187 — Gift card liability 289 — Goodwill 835 — Deferred rent — 11,835 Intangible asset 1,224 1,374 Inventories 1,452 1,940 Sales return reserve 208 185 Capital loss carryforward 39 39 Stock-based compensation 403 290 Loyalty program 2,415 2,191 Total gross deferred tax assets $ 70,610 $ 18,307 Deferred tax liabilities: Depreciation $ (15,020) $ (14,670) ROU asset (55,272) — Prepaid expenses (836) (553) Gift card escheatment (44) (87) Total gross deferred tax liabilities $ (71,172) $ (15,310) Net deferred tax asset (liability) $ (562) $ 2,997 |
Nature of Business (Details)
Nature of Business (Details) | Feb. 01, 2020statestore |
Nature of Business | |
Number of stores | store | 103 |
Number of states | state | 27 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) $ in Thousands | Feb. 03, 2018 | Feb. 01, 2020USD ($)segmentsubsidiary | Feb. 02, 2019USD ($) | Feb. 03, 2018USD ($) | Feb. 04, 2018USD ($) |
Significant Accounting Policies [Line Items] | |||||
Number of subsidiaries | subsidiary | 4 | ||||
Fiscal period duration | 364 days | 364 days | 371 days | ||
Number of reportable segments | segment | 1 | ||||
Number of operating segments | segment | 1 | ||||
Allowance for doubtful accounts receivable | $ 0 | $ 0 | |||
Inventory write downs | 5,761 | 7,012 | |||
Impairment charge to long-lived assets | 0 | 0 | $ 0 | ||
Impairment of goodwill | 0 | 0 | 0 | ||
Prepaid expenses and other | 12,732 | 15,174 | |||
Deferred tax assets | 2,997 | ||||
Accumulated earnings (deficit) | 23,029 | (6,441) | |||
Gift card redemption period | 2 years | ||||
Loyalty reward redemption period | 18 months | ||||
Stop-loss insurance maintained by health insurance company, deductible per person under health insurance | 100 | ||||
Reserve on claims included in accrued expenses | 945 | 900 | |||
Stop-loss insurance maintained by workers compensation insurance company, deductible per person under workers compensation insurance | 150 | ||||
Workers compensation plan, estimated IBNR | 902 | 1,045 | |||
Advertising Expense | 11,493 | 8,437 | 7,760 | ||
Comprehensive Income (Loss), Net of Tax, Attributable to Parent | $ 0 | 0 | $ 0 | ||
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 | ||||
Adjustments due to Topic 606 | |||||
Significant Accounting Policies [Line Items] | |||||
Prepaid expenses and other | $ 1,054 | ||||
Accrued expenses related to sales return liability | 1,054 | ||||
Accrued expenses related to loyalty rewards and gift cards | (3,521) | ||||
Deferred tax assets | (884) | ||||
Accumulated earnings (deficit) | $ (2,634) | ||||
Wells Fargo Senior Secured Revolving Credit Facility | |||||
Significant Accounting Policies [Line Items] | |||||
In Transit Deposits | $ 7,400 | $ 7,035 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 01, 2020 | Feb. 03, 2019 | Feb. 02, 2019 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Right-of-use assets | $ 224,520 | ||
Lease liabilities | 251,741 | ||
Retained earnings | $ 23,029 | $ (6,441) | |
Package of practical expedient | true | ||
Land easement practical expedient | true | ||
Use of hindsight practical expedient | false | ||
ASU 2016-02 | Restatement | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Right-of-use assets | $ 183,000 | ||
Lease liabilities | 214,000 | ||
Retained earnings | $ 9,300 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Revenue Recognition Accounting Policy (Details) $ in Thousands | 12 Months Ended |
Feb. 01, 2020USD ($) | |
Summary of Significant Accounting Policies | |
Gift card historical breakage (as a percent) | 3.50% |
Gift card escheat liability | $ 0 |
Redemption Period | 2 years |
Breakage of loyalty reward (as a percent) | 50.00% |
Loyalty reward escheat liability | $ 0 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Contract Balances (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 01, 2020 | Feb. 02, 2019 | Feb. 03, 2018 | |
Disaggregation of Revenue [Line Items] | |||
Right of return assets, which are included in prepaid expenses and other | $ 1,683 | $ 1,496 | |
Sales return liabilities, which are included in accrued expenses | (2,512) | (2,233) | |
Gift breakage income | 1,430 | 1,007 | $ 1,337 |
Recognized customer loyalty program breakage income | 2,480 | 1,439 | $ 1,022 |
Revenue related to the gift card liability | $ 8,219 | 8,802 | |
Revenue from contract with customer liability recognition period | 2 years | ||
Gift Card | |||
Disaggregation of Revenue [Line Items] | |||
Estimated contract liabilities, net of breakage | $ (13,575) | (11,569) | |
Loyalty Reward Program | |||
Disaggregation of Revenue [Line Items] | |||
Estimated contract liabilities, net of breakage | $ (9,621) | $ (8,729) |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Disaggregation of revenue from contracts with customers (Details) | 12 Months Ended | ||
Feb. 01, 2020 | Feb. 02, 2019 | Feb. 03, 2018 | |
Disaggregation of revenue from contracts with customers | |||
Net sales (as a percent) | 100.00% | 100.00% | 100.00% |
Camping | |||
Disaggregation of revenue from contracts with customers | |||
Net sales (as a percent) | 14.40% | 14.20% | 15.10% |
Clothing | |||
Disaggregation of revenue from contracts with customers | |||
Net sales (as a percent) | 9.30% | 8.90% | 9.30% |
Fishing | |||
Disaggregation of revenue from contracts with customers | |||
Net sales (as a percent) | 11.10% | 10.60% | 10.70% |
Footwear | |||
Disaggregation of revenue from contracts with customers | |||
Net sales (as a percent) | 7.50% | 7.30% | 7.40% |
Hunting and Shooting | |||
Disaggregation of revenue from contracts with customers | |||
Net sales (as a percent) | 49.10% | 48.30% | 48.70% |
Optics, Electronics, Accessories, and Other | |||
Disaggregation of revenue from contracts with customers | |||
Net sales (as a percent) | 8.60% | 10.70% | 8.80% |
Acquisition of Field and Stre_3
Acquisition of Field and Stream Stores (Details) $ in Thousands | Oct. 11, 2019USD ($)store | Sep. 28, 2019USD ($)store | Mar. 31, 2020store | Feb. 01, 2020USD ($) |
Business Acquisition [Line Items] | ||||
Number of stores acquired | store | 1 | |||
Sportsman’s Warehouse, Inc | DICK’S | ||||
Business Acquisition [Line Items] | ||||
Number of stores acquired | store | 8 | |||
Number Of Acquired Stores Closed | store | 8 | |||
Maximum period for which transition services will be provided | 120 days | |||
Aggregate consideration | $ | $ 28,703 | $ 28,700 | ||
Acquisition related cost | $ | $ 662 | |||
Sportsman’s Warehouse, Inc | DICK’S | Revolving Credit Facility | ||||
Business Acquisition [Line Items] | ||||
Amount drawn | $ | $ 19,800 |
Acquisition of Field and Stre_4
Acquisition of Field and Stream Stores - Purchase price consideration and related cash outflow (Details) - USD ($) $ in Thousands | Oct. 11, 2019 | Sep. 28, 2019 | Jan. 31, 2020 |
Business Acquisition [Line Items] | |||
Payable to seller | $ 9,000 | ||
Liabilities except leases assumed | $ 0 | ||
DICK’S | Sportsman’s Warehouse, Inc | |||
Business Acquisition [Line Items] | |||
Cash paid to seller | 19,241 | ||
Payable to seller | 9,462 | ||
Total purchase price | $ 28,703 | $ 28,700 |
Acquisition of Field and Stre_5
Acquisition of Field and Stream Stores - Estimated fair value of the identifiable assets acquired and assumed liabilities (Details) - USD ($) $ in Thousands | 4 Months Ended | 12 Months Ended | |||
Feb. 01, 2020 | Feb. 01, 2020 | Feb. 02, 2019 | Feb. 03, 2018 | Oct. 11, 2019 | |
Business Combination Recognized Identifiable Assets Acquired And Assumed Liabilities | |||||
Cash | $ 167 | ||||
Inventory | 19,152 | ||||
Property, plant, and equipment | 5,250 | ||||
Operating lease right of use asset | 33,436 | ||||
Operating lease right of use liability | (31,051) | ||||
Deferred tax asset | 253 | ||||
Goodwill | $ 1,496 | $ 1,496 | 1,496 | ||
Total | $ 28,703 | ||||
Amount of goodwill amortizable for tax purpose | 4,134 | 4,134 | |||
Net sales | 24,345 | 886,401 | $ 849,129 | $ 809,671 | |
Net income | $ 2,246 | $ 20,215 | $ 23,750 | $ 17,742 |
Acquisition of Field and Stre_6
Acquisition of Field and Stream Stores - Pro forma results - (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Feb. 01, 2020 | Feb. 02, 2019 | |
Business Acquisitions ProForma | ||
Net sales | $ 931,703 | $ 923,678 |
Net income | $ 20,369 | $ 26,624 |
Basic | $ 0.47 | $ 0.62 |
Diluted | $ 0.47 | $ 0.62 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 01, 2020 | Feb. 02, 2019 | Feb. 03, 2018 | |
Property Plant And Equipment [Line Items] | |||
Total property and equipment, gross | $ 189,421 | $ 168,136 | |
Less accumulated depreciation and amortization | (90,654) | (76,052) | |
Total property and equipment, net | 98,767 | 92,084 | |
Depreciation expense | 19,294 | 17,961 | $ 15,864 |
Furniture, fixtures, and equipment | |||
Property Plant And Equipment [Line Items] | |||
Total property and equipment, gross | 84,059 | 71,820 | |
Leasehold improvements | |||
Property Plant And Equipment [Line Items] | |||
Total property and equipment, gross | 103,791 | 94,573 | |
Construction in progress | |||
Property Plant And Equipment [Line Items] | |||
Total property and equipment, gross | $ 1,571 | $ 1,743 |
Definite Lived Intangible Ass_3
Definite Lived Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Feb. 01, 2020 | Feb. 02, 2019 | |
Finite-Lived Intangible Assets, Net [Abstract] | ||
Gross carrying amount | $ 257 | $ 9,320 |
Accumulated amortization | (37) | (9,074) |
Net carrying amount | $ 220 | 246 |
Non-compete agreement | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortization period | 5 years | |
Gross carrying amount | 9,063 | |
Accumulated amortization | $ (9,063) | |
Domain Name | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortization period | 10 years | 10 years |
Gross carrying amount | $ 257 | $ 257 |
Accumulated amortization | (37) | (11) |
Net carrying amount | $ 220 | $ 246 |
Definite Lived Intangible Ass_4
Definite Lived Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 01, 2020 | Feb. 02, 2019 | Feb. 03, 2018 | |
Definite Lived Intangible Asset | |||
Amortization expense for definite lived intangible asset, fiscal year | $ 26 | $ 289 | $ 1,842 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 01, 2020 | Feb. 03, 2019 | Feb. 02, 2019 | |
Lessee, Lease, Description [Line Items] | |||
Options to extend | true | ||
Operating lease right of use asset | $ 224,520 | ||
Operating lease liabilities | 251,741 | ||
Deferred rent | $ 41,854 | ||
Retained earnings | 23,029 | $ (6,441) | |
Increase in ROU assets and operating lease liabilities | 66,095 | ||
ASU 2016-02 | Restatement | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease right of use asset | $ 183,000 | ||
Operating lease liabilities | 214,000 | ||
Deferred rent | 14,200 | ||
Tenant improvement allowances | 20,600 | ||
Prepaid rent | $ 3,800 | ||
Retained earnings | $ 9,300 | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease terms | 10 years |
Leases - Other Information (Det
Leases - Other Information (Details) $ in Thousands | 12 Months Ended |
Feb. 01, 2020USD ($) | |
Leases | |
Lease expense | $ 59,846 |
Operating cash flows from operating leases - Cash paid for amounts included in the measurement of lease liabilities | (49,713) |
Right-of-use assets obtained in exchange for new or remeasured operating lease liabilities | $ 66,095 |
Weighted-average remaining lease term - operating leases | 6 years 3 months 4 days |
Weighted-average discount rate - operating leases | 8.00% |
Leases - ASC 842 Maturities (De
Leases - ASC 842 Maturities (Details) - USD ($) $ in Thousands | Jan. 30, 2021 | Feb. 01, 2020 |
Maturities: | ||
2020 | $ 54,380 | |
2021 | 51,524 | |
2022 | 47,363 | |
2023 | 42,700 | |
2024 | 34,859 | |
Thereafter | 130,263 | |
Undiscounted cash flows | 361,089 | |
Reconciliation of lease liabilities: | ||
Lease liabilities - current | 34,487 | |
Lease liabilities - noncurrent | 217,254 | |
Lease liabilities - total | 251,741 | |
Difference between undiscounted and discounted cash flows | $ 109,348 | |
Forecast | ||
Reconciliation of lease liabilities: | ||
Lease liabilities - noncurrent | $ 11,600 | |
Maximum | Forecast | ||
Reconciliation of lease liabilities: | ||
Lease term | 10 years | |
Minimum | Forecast | ||
Reconciliation of lease liabilities: | ||
Lease term | 5 years |
Leases - ASC 840 Rent Expenses
Leases - ASC 840 Rent Expenses (Details) $ in Thousands | 12 Months Ended |
Feb. 02, 2019USD ($) | |
Leases | |
Operating lease expense | $ 54,027 |
Total lease expense | $ 54,027 |
Leases - ASC 840 Maturities (De
Leases - ASC 840 Maturities (Details) $ in Thousands | Feb. 02, 2019USD ($) |
Maturities: | |
2019 | $ 47,551 |
2020 | 46,824 |
2021 | 43,070 |
2022 | 38,160 |
2023 | 33,246 |
Thereafter | 74,821 |
Total minimum lease payments | $ 283,672 |
Accrued Expenses and Other Li_3
Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands | Feb. 01, 2020 | Feb. 02, 2019 |
Accrued Expenses and Other Liabilities | ||
Book overdraft | $ 15,827 | $ 10,297 |
Unearned revenue | 25,705 | 21,836 |
Accrued payroll and related expenses | 11,436 | 11,590 |
Sales and use tax payable | 5,169 | 4,250 |
Accrued construction costs | 1,112 | 760 |
Other | 10,869 | 7,651 |
Total accrued expenses | $ 70,118 | $ 56,384 |
Revolving Line Of Credit (Detai
Revolving Line Of Credit (Details) $ in Thousands | Mar. 13, 2020USD ($)store | May 23, 2018USD ($) | Mar. 31, 2020store | Feb. 01, 2020USD ($) | Feb. 02, 2019USD ($) | Feb. 03, 2018USD ($) |
Line Of Credit Facility [Line Items] | ||||||
Capitalization of fees paid | $ 1,331 | |||||
Number of stores acquired | store | 1 | |||||
Amortization of deferred financing fees | $ 85 | $ 1,173 | ||||
Gross borrowings under revolving line of credit | 958,869 | 1,023,983 | $ 909,180 | |||
Gross paydowns under revolving line of credit | 994,666 | 950,143 | 912,792 | |||
Wells Fargo Senior Secured Revolving Credit Facility | ||||||
Line Of Credit Facility [Line Items] | ||||||
Line of credit facility, amount outstanding | $ 1,075 | 123,478 | 151,341 | |||
Amounts in depository under lock-box arrangements | $ 7,400 | 7,035 | ||||
Line Of Credit Facility Covenant Terms | The Amended Credit Agreement also requires us to maintain a minimum availability at all times of not less than 10% of the gross borrowing base | |||||
Number of stores acquired | store | 1 | |||||
Line of credit , maturity date | May 23, 2023 | |||||
Weighted average interest rate on amount outstanding | 3.07% | |||||
Deferred financing fees outstanding | $ 834 | 1,085 | ||||
Amortization of deferred financing fees | $ 251 | $ 195 | $ 131 | |||
Wells Fargo Senior Secured Revolving Credit Facility | Minimum | ||||||
Line Of Credit Facility [Line Items] | ||||||
Line of credit facility gross borrowing base percentage | 10.00% | |||||
Wells Fargo Senior Secured Revolving Credit Facility | Maximum | ||||||
Line Of Credit Facility [Line Items] | ||||||
Line of credit facility, maximum borrowing capacity | 250,000 | |||||
Wells Fargo Senior Secured Revolving Credit Facility | Federal Funds Rate | ||||||
Line Of Credit Facility [Line Items] | ||||||
Term loan interest rate (as a percent) | 0.50% | |||||
Wells Fargo Senior Secured Revolving Credit Facility | Base Rate | Minimum | ||||||
Line Of Credit Facility [Line Items] | ||||||
Term loan interest rate (as a percent) | 0.25% | |||||
Wells Fargo Senior Secured Revolving Credit Facility | Base Rate | Maximum | ||||||
Line Of Credit Facility [Line Items] | ||||||
Term loan interest rate (as a percent) | 0.75% | |||||
Wells Fargo Senior Secured Revolving Credit Facility | LIBOR | ||||||
Line Of Credit Facility [Line Items] | ||||||
Term loan interest rate (as a percent) | 1.00% | |||||
Wells Fargo Senior Secured Revolving Credit Facility | LIBOR | Minimum | ||||||
Line Of Credit Facility [Line Items] | ||||||
Term loan interest rate (as a percent) | 1.25% | |||||
Wells Fargo Senior Secured Revolving Credit Facility | LIBOR | Maximum | ||||||
Line Of Credit Facility [Line Items] | ||||||
Term loan interest rate (as a percent) | 1.75% | |||||
New Term Loan | ||||||
Line Of Credit Facility [Line Items] | ||||||
New term loan | $ 40,000 | |||||
New Term Loan | LIBOR | ||||||
Line Of Credit Facility [Line Items] | ||||||
Term loan interest rate (as a percent) | 5.75% | |||||
Wells Fargo Stand-by Commercial Letters of Credit | ||||||
Line Of Credit Facility [Line Items] | ||||||
Net borrowing available under revolving line of credit | $ 1,705 |
Long-Term Debt (Details)
Long-Term Debt (Details) - USD ($) $ in Thousands | Feb. 01, 2020 | Feb. 02, 2019 |
Less current portion, net of discount and debt issuance costs | $ (5,936) | $ (7,915) |
Long-term portion | 23,781 | 27,717 |
Prior Term Loan | ||
Term loan | 36,000 | |
Less debt issuance costs | (368) | |
Long-term debt | 35,632 | |
Less current portion, net of discount and debt issuance costs | (7,915) | |
Long-term portion | $ 27,717 | |
New Term Loan | ||
Term loan | 30,000 | |
Less debt issuance costs | (283) | |
Long-term debt | 29,717 | |
Less current portion, net of discount and debt issuance costs | (5,936) | |
Long-term portion | $ 23,781 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Details) - USD ($) $ in Thousands | May 23, 2018 | Feb. 01, 2020 | Feb. 02, 2019 |
Debt Instrument [Line Items] | |||
Amortization of deferred financing fees | $ 85 | $ 1,173 | |
Amortization of discount | 678 | ||
New Term Loan | |||
Debt Instrument [Line Items] | |||
Debt instrument issuance price, percentage of aggregate principal amount | 100.00% | ||
New term loan | $ 40,000 | ||
Line of credit, maturity date | May 23, 2023 | ||
Term loan effective rate | 7.31% | ||
Quarterly loan payment | $ 2,000 | ||
Final Installment amount | 24,000 | ||
Term loan | 30,000 | ||
Unamortized debt issuance costs | $ 283 | ||
Prior Term Loan | |||
Debt Instrument [Line Items] | |||
Term loan | 36,000 | ||
Unamortized debt issuance costs | $ 368 | ||
LIBOR | New Term Loan | |||
Debt Instrument [Line Items] | |||
Term loan interest rate (as a percent) | 5.75% |
Sale Leaseback Transactions (De
Sale Leaseback Transactions (Details) $ in Thousands | 12 Months Ended | ||
Feb. 01, 2020USD ($)store | Feb. 02, 2019USD ($)store | Feb. 03, 2018USD ($)store | |
Sale Leaseback Transaction [Line Items] | |||
Number of stores | 103 | ||
Land and Buildings | One Store Locations | |||
Sale Leaseback Transaction [Line Items] | |||
Number of stores | 1 | 1 | |
Tenant allowance received | $ | $ 9,533 | $ 1,717 | |
Land and Buildings | Four Store Locations | |||
Sale Leaseback Transaction [Line Items] | |||
Number of stores | 4 | ||
Tenant allowance received | $ | $ 9,022 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 4 Months Ended | 12 Months Ended | ||
Feb. 01, 2020 | Feb. 01, 2020 | Feb. 02, 2019 | Feb. 03, 2018 | |
Earnings Per Share | ||||
Net income | $ 2,246 | $ 20,215 | $ 23,750 | $ 17,742 |
Weighted-average shares of common stock outstanding: | ||||
Basic | 43,166 | 42,878 | 42,496 | |
Dilutive effect of common stock equivalents | 422 | 101 | 26 | |
Diluted | 43,588 | 42,979 | 42,522 | |
Basic earnings per share | $ 0.47 | $ 0.55 | $ 0.42 | |
Diluted earnings per share | $ 0.46 | $ 0.55 | $ 0.42 | |
Restricted stock units considered anti-dilutive and excluded in the calculation | 4 | 56 | 191 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Feb. 01, 2020 | Feb. 02, 2019 | Feb. 03, 2018 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation | $ 2,104 | $ 2,829 | $ 2,294 |
Unrecognized compensation costs | $ 3,966 | $ 2,692 | |
Nonvested Restricted Stock Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Vested, Shares | (26) | (80) | |
Nonvested Performance-Based Stock Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Issuance of nonvested stock units | 226 | 36 | |
Nonvested stock issued, weighted average grant date fair value per share | $ 3.53 | $ 4.91 | |
Vested, Shares | (7) | (46) | |
Nonvested Stock Unit Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Issuance of nonvested stock units | 638 | 330 | |
Nonvested stock issued, weighted average grant date fair value per share | $ 4.13 | $ 4.89 | |
Vested, Shares | (269) | (300) | |
Employees | Nonvested Restricted Stock Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Issuance of nonvested stock units | 0 | 0 | |
Employees | Nonvested Performance-Based Stock Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Issuance of nonvested stock units | 289 | 163 | |
Nonvested stock issued, weighted average grant date fair value per share | $ 3.53 | $ 4.91 | |
Nonvested stock awards vested over grant date | 3 years | 3 years | |
Employees | Nonvested Stock Unit Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Nonvested stock awards vested over grant date | 3 years | 3 years | |
Vesting percentage | 33.00% | 33.00% | |
Board Of Directors | Nonvested Stock Unit Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Nonvested stock awards vested over grant date | 12 months | 12 months | |
Vesting percentage | 8.33% | 8.33% | |
Employees And Board Of Directors | Nonvested Stock Unit Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Issuance of nonvested stock units | 638 | 330 | |
Nonvested stock issued, weighted average grant date fair value per share | $ 4.13 | $ 4.89 | |
Employee Stock Purchase Plan | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation | $ 133 | $ 143 | 160 |
2019 Plan | Employee Stock Plans | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Number of shares available for awards | 3,169 | ||
Number of awards outstanding | 956 | ||
Selling, General and Administrative Expenses | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation | $ 2,104 | $ 2,829 | $ 2,294 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - $ / shares shares in Thousands | 12 Months Ended | |
Feb. 01, 2020 | Feb. 02, 2019 | |
Nonvested Restricted Stock Awards | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Beginning balance, Shares | 26 | 108 |
Forfeitures, Shares | (2) | |
Vested, Shares | (26) | (80) |
Ending balance, Shares | 26 | |
Beginning balance, Weighted average grant-date fair value | $ 11.25 | $ 11.25 |
Forfeitures, Weighted average grant-date fair value | 11.25 | |
Vested, Weighted average grant-date fair value | $ 11.25 | 11.25 |
Ending balance, Weighted average grant-date fair value | $ 11.25 | |
Nonvested Performance-Based Stock Awards | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Beginning balance, Shares | 34 | 49 |
Grants, Shares | 226 | 36 |
Forfeitures, Shares | (3) | (5) |
Vested, Shares | (7) | (46) |
Ending balance, Shares | 250 | 34 |
Beginning balance, Weighted average grant-date fair value | $ 6.07 | $ 11.25 |
Grants, Weighted average grant-date fair value | 3.53 | 4.91 |
Forfeitures, Weighted average grant-date fair value | 4.91 | 5.36 |
Vested, Weighted average grant-date fair value | 11.25 | 11.25 |
Ending balance, Weighted average grant-date fair value | $ 3.66 | $ 6.07 |
Nonvested Stock Unit Awards | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Beginning balance, Shares | 441 | 419 |
Grants, Shares | 638 | 330 |
Forfeitures, Shares | (66) | (8) |
Vested, Shares | (269) | (300) |
Ending balance, Shares | 744 | 441 |
Beginning balance, Weighted average grant-date fair value | $ 4.92 | $ 5.15 |
Grants, Weighted average grant-date fair value | 4.13 | 4.89 |
Forfeitures, Weighted average grant-date fair value | 5.08 | 4.91 |
Vested, Weighted average grant-date fair value | 4.67 | 5.23 |
Ending balance, Weighted average grant-date fair value | $ 4.32 | $ 4.92 |
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. 01, 2020 | Feb. 02, 2019 | Feb. 03, 2018 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 2,104 | $ 2,829 | $ 2,294 | |
Employee Stock Purchase Plan | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Number of shares granted under ESPP | 800 | |||
Percentage of market value per share fixed as purchase price | 85.00% | |||
Stock-based compensation expense | $ 133 | $ 143 | $ 160 |
Employee Stock Purchase Plan -
Employee Stock Purchase Plan - Additional Information (Details) | 12 Months Ended | |
Feb. 01, 2020 | Feb. 02, 2019 | |
Stock-Based Compensation | ||
Risk-free interest rate | 1.54% | 2.56% |
Expected life (in years) | 6 months | 6 months |
Expected volatility | 39.00% | 32.20% |
Income Taxes - Provision for In
Income Taxes - Provision for Income Tax (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 01, 2020 | Feb. 02, 2019 | Feb. 03, 2018 | |
Current: | |||
Federal | $ 4,004 | $ 4,630 | $ 12,718 |
State | 540 | 1,719 | 1,868 |
Total current | 4,544 | 6,349 | 14,586 |
Deferred: | |||
Federal | 1,246 | 598 | 780 |
State | (536) | 116 | (278) |
Total deferred | 710 | 714 | 502 |
Total income tax provision | $ 5,254 | $ 7,063 | $ 15,088 |
Income Taxes - Schedule of Fede
Income Taxes - Schedule of Federal Statutory Tax Rate (Details) | 12 Months Ended | |||||
Feb. 01, 2020 | Dec. 31, 2019 | Feb. 02, 2019 | Dec. 31, 2018 | Feb. 03, 2018 | Dec. 31, 2017 | |
Reconciliation of the federal statutory income tax rate to the effective income tax rate | ||||||
Federal statutory rate | 21.00% | 21.00% | 21.00% | 21.00% | 33.70% | 35.00% |
State tax, net of federal benefit | 1.50% | 4.10% | 3.80% | |||
Permanent items | 1.10% | 2.50% | 2.00% | |||
Other items | (0.20%) | (0.40%) | (0.20%) | |||
Tax credits | (2.80%) | |||||
Tax reform adjustment | (4.30%) | 6.70% | ||||
Effective income tax rate | 20.60% | 22.90% | 46.00% |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Feb. 01, 2020 | Feb. 02, 2019 |
Deferred tax assets: | ||
Accrued liabilities | $ 558 | $ 453 |
Operating lease liability | 63,187 | |
Gift card liability | 289 | |
Goodwill | 835 | |
Deferred rent | 11,835 | |
Intangible asset | 1,224 | 1,374 |
Inventories | 1,452 | 1,940 |
Sales return reserve | 208 | 185 |
Capital loss carryforward | 39 | 39 |
Stock-based compensation | 403 | 290 |
Loyalty program | 2,415 | 2,191 |
Total gross deferred tax assets | 70,610 | 18,307 |
Deferred tax liabilities: | ||
Depreciation | (15,020) | (14,670) |
ROU asset | (55,272) | |
Prepaid expenses | (836) | (553) |
Gift card escheatment | (44) | (87) |
Total gross deferred tax liabilities | (71,172) | (15,310) |
Net deferred tax asset (liability) | $ 2,997 | |
Net deferred tax asset (liability) | $ (562) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Feb. 01, 2020 | Dec. 31, 2019 | Feb. 02, 2019 | Dec. 31, 2018 | Feb. 03, 2018 | Dec. 31, 2017 | |
Income Taxes | ||||||
U.S. Federal statutory rate | 21.00% | 21.00% | 21.00% | 21.00% | 33.70% | 35.00% |
Discrete net tax expense | $ 2,153 | |||||
Tax expense | 2,600 | |||||
Tax benefit | 447 | |||||
Discrete net benefit related to tax reform | $ 1,300 | |||||
Unrecognized tax benefits | $ 0 | |||||
Accrued interest and penalties | $ 0 | $ 0 | $ 95 |
Related-Party Transactions (Det
Related-Party Transactions (Details) - Seidler Equity Partners III L.P. - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 01, 2020 | Feb. 02, 2019 | Feb. 03, 2018 | |
Related Party Transaction [Line Items] | |||
Related party agreement date | Aug. 14, 2009 | ||
Payments made to related party | $ 0 | $ 0 | $ 0 |
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. 01, 2020 | Feb. 02, 2019 | Feb. 03, 2018 | |
Retirement Plan | |||
Company contribution under plan | $ 835 | $ 572 | $ 390 |
Subsequent Event (Details)
Subsequent Event (Details) | Mar. 06, 2020store | Feb. 14, 2020USD ($)store | Oct. 11, 2019USD ($) | Sep. 28, 2019USD ($)store | Mar. 31, 2020USD ($)store |
Subsequent Event | |||||
Number of stores acquired | 1 | ||||
Sportsman’s Warehouse, Inc | DICK’S | |||||
Subsequent Event | |||||
Number of stores acquired | 8 | ||||
Total purchase price | $ | $ 28,703,000 | $ 28,700,000 | |||
Subsequent Event | |||||
Subsequent Event | |||||
Number of stores closed | 3 | ||||
Number of stores with significant restrictions | $ | $ 8 | ||||
Number of stores | 106 | ||||
Subsequent Event | Sportsman’s Warehouse, Inc | DICK’S | |||||
Subsequent Event | |||||
Number of stores acquired | 1 | 1 | |||
Total purchase price | $ | $ 2,100,000 | ||||
Percentage of inventory to be paid within 90 days | 50.00% | 50.00% |