Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Apr. 01, 2017 | May 16, 2017 | Sep. 30, 2016 | |
Document and Entity Information | |||
Entity Registrant Name | Container Store Group, Inc. | ||
Entity Central Index Key | 1,411,688 | ||
Document Type | 10-K | ||
Document Period End Date | Apr. 1, 2017 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --04-01 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $ 85,983,122 | ||
Common Stock Outstanding | 48,291,648 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY |
Consolidated balance sheets
Consolidated balance sheets - USD ($) $ in Thousands | Apr. 01, 2017 | Feb. 27, 2016 |
Current assets: | ||
Cash | $ 10,736 | $ 13,609 |
Accounts receivable, net | 27,476 | 28,843 |
Inventory | 103,120 | 86,435 |
Prepaid expenses | 10,550 | 8,692 |
Income taxes receivable | 16 | 157 |
Other current assets | 10,787 | 8,695 |
Total current assets | 162,685 | 146,431 |
Noncurrent assets: | ||
Property and equipment, net | 165,498 | 176,117 |
Goodwill | 202,815 | 202,815 |
Trade names | 226,685 | 228,368 |
Deferred financing costs, net | 320 | 419 |
Noncurrent deferred tax assets, net | 2,139 | 2,090 |
Other assets | 1,692 | 1,879 |
Total noncurrent assets | 599,149 | 611,688 |
Total assets | 761,834 | 758,119 |
Current liabilities: | ||
Accounts payable | 44,762 | 40,274 |
Accrued liabilities | 60,107 | 69,635 |
Revolving lines of credit | 721 | |
Current portion of long-term debt | 5,445 | 5,373 |
Income taxes payable | 2,738 | |
Total current liabilities | 113,052 | 116,003 |
Noncurrent liabilities: | ||
Long-term debt | 312,026 | 316,135 |
Noncurrent deferred tax liabilities, net | 80,679 | 80,720 |
Deferred rent and other long-term liabilities | 34,287 | 38,193 |
Total noncurrent liabilities | 426,992 | 435,048 |
Total liabilities | 540,044 | 551,051 |
Commitments and contingencies (Note 12) | ||
Shareholders' equity: | ||
Common stock, $0.01 par value, 250,000,000 shares authorized; 48,045,114 shares issued at April 1, 2017, 47,986,975 shares issued at February 27, 2016 | 480 | 480 |
Additional paid-in capital | 859,102 | 856,879 |
Accumulated other comprehensive loss | (22,643) | (19,835) |
Retained deficit | (615,149) | (630,456) |
Total shareholders' equity | 221,790 | 207,068 |
Total liabilities and shareholders' equity | $ 761,834 | $ 758,119 |
Consolidated balance sheets (Pa
Consolidated balance sheets (Parenthetical) - $ / shares | Apr. 01, 2017 | Feb. 27, 2016 | Mar. 01, 2014 |
Consolidated balance sheets | |||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 250,000,000 | 250,000,000 | |
Common stock, shares issued | 48,045,114 | 47,986,975 |
Consolidated statements of oper
Consolidated statements of operations - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||
Apr. 02, 2016 | Apr. 04, 2015 | Apr. 01, 2017 | Dec. 31, 2016 | Oct. 01, 2016 | Jul. 02, 2016 | Apr. 02, 2016 | Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Consolidated statements of operations | |||||||||||||
Net sales | $ 69,218 | $ 66,761 | $ 221,042 | $ 216,380 | $ 205,060 | $ 177,448 | $ 209,881 | $ 212,836 | $ 204,412 | $ 169,958 | $ 819,930 | $ 794,630 | $ 781,866 |
Cost of sales (excluding depreciation and amortization) | 29,023 | 343,860 | 331,079 | 323,800 | |||||||||
Gross profit | 40,195 | 39,254 | 127,318 | 125,702 | 118,355 | 104,695 | 121,275 | 125,434 | 118,273 | 99,511 | 476,070 | 463,551 | 458,066 |
Selling, general, and administrative expenses (excluding depreciation and amortization) | 34,504 | 33,728 | 387,948 | 393,810 | 372,867 | ||||||||
Stock-based compensation | 147 | 1,989 | 1,556 | 1,289 | |||||||||
Pre-opening costs | 191 | 6,852 | 9,033 | 8,283 | |||||||||
Depreciation and amortization | 3,009 | 37,124 | 34,230 | 31,011 | |||||||||
Other expenses | 102 | 1,058 | 1,132 | ||||||||||
Loss (gain) on disposal of assets | 57 | 61 | (3,487) | ||||||||||
Income from operations | 2,242 | 2,565 | 17,181 | 12,561 | 10,272 | 1,028 | 9,452 | 10,156 | 9,910 | (4,981) | 41,042 | 24,861 | 46,971 |
Interest expense | 1,550 | 16,687 | 16,810 | 17,105 | |||||||||
Income before taxes | 692 | 978 | 24,355 | 8,051 | 29,866 | ||||||||
Provision for income taxes | 338 | 340 | 9,402 | 2,909 | 7,193 | ||||||||
Net income | $ 354 | $ 638 | $ 8,377 | $ 5,092 | $ 3,541 | $ (2,057) | $ 3,380 | $ 3,924 | $ 3,342 | $ (5,788) | $ 14,953 | $ 5,142 | $ 22,673 |
Net income per common share - basic and diluted (in dollars per shares) | $ 0.01 | $ 0.17 | $ 0.11 | $ 0.07 | $ (0.04) | $ 0.07 | $ 0.08 | $ 0.07 | $ (0.12) | $ 0.31 | $ 0.11 | $ 0.47 | |
Weighted-average common shares - basic (in shares) | 47,986,975 | 48,009,029 | 47,999,535 | 47,991,445 | 47,986,975 | 47,986,975 | 47,986,975 | 47,986,401 | 47,983,785 | 47,996,746 | 47,985,717 | 47,971,243 | |
Weighted-average common shares - diluted (in shares) | 47,986,975 | 48,073,420 | 48,022,499 | 48,001,112 | 47,986,975 | 47,986,975 | 47,986,975 | 47,986,972 | 47,983,785 | 48,016,010 | 47,985,717 | 48,520,865 |
Consolidated statements of comp
Consolidated statements of comprehensive income - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||
Apr. 02, 2016 | Apr. 04, 2015 | Apr. 01, 2017 | Dec. 31, 2016 | Oct. 01, 2016 | Jul. 02, 2016 | Apr. 02, 2016 | Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Consolidated statements of comprehensive income | |||||||||||||
Net income | $ 354 | $ 638 | $ 8,377 | $ 5,092 | $ 3,541 | $ (2,057) | $ 3,380 | $ 3,924 | $ 3,342 | $ (5,788) | $ 14,953 | $ 5,142 | $ 22,673 |
Unrealized (loss) gain on financial instruments, net of tax (benefit) provision of $(85), $606, $(604) and $7 | 12 | (138) | 853 | (935) | |||||||||
Pension liability adjustment, net of tax provision (benefit) of $142, $39, $(4) and $0 | (66) | (386) | 175 | (14) | |||||||||
Foreign currency translation adjustment | 4,053 | (6,283) | (2,521) | (19,076) | |||||||||
Comprehensive income | $ 4,353 | $ 8,146 | $ 3,649 | $ 2,648 |
Consolidated statements of com6
Consolidated statements of comprehensive income (Parenthetical) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Apr. 02, 2016 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Consolidated statements of comprehensive income | ||||
Unrealized (loss) gain on financial instruments, taxes | $ 7 | $ (85) | $ 606 | $ (604) |
Pension liability adjustment, taxes | $ 0 | $ 142 | $ 39 | $ (4) |
Consolidated statements of shar
Consolidated statements of shareholders' equity - USD ($) $ in Thousands | Common stock | Additional paid-in capital | Accumulated other comprehensive income (loss) | Retained deficit | Total |
Balance at the beginning of period at Mar. 01, 2014 | $ 479 | $ 853,295 | $ 1,683 | $ (658,271) | $ 197,186 |
Balance (in shares) at Mar. 01, 2014 | 47,941,180 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 22,673 | 22,673 | |||
Stock-based compensation | 1,289 | 1,289 | |||
Excess tax provision from stock-based compensation | (4) | (4) | |||
Stock option exercises | $ 1 | 742 | $ 743 | ||
Stock option exercises (in shares) | 42,480 | 42,480 | |||
Foreign currency translation adjustment | (19,076) | $ (19,076) | |||
Unrealized (loss) gain on financial instruments, net of tax (benefit) provision of $604, $606, $53 and $85 | (935) | (935) | |||
Pension liability adjustment, net of $4, $39, $0 and $142 tax provision (benefit) | (14) | (14) | |||
Balance at the end of period at Feb. 28, 2015 | $ 480 | 855,322 | (18,342) | (635,598) | 201,862 |
Balance (in shares) at Feb. 28, 2015 | 47,983,660 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 5,142 | 5,142 | |||
Stock-based compensation | 1,556 | 1,556 | |||
Excess tax provision from stock-based compensation | (58) | (58) | |||
Stock option exercises | 59 | $ 59 | |||
Stock option exercises (in shares) | 3,315 | 3,315 | |||
Foreign currency translation adjustment | (2,521) | $ (2,521) | |||
Unrealized (loss) gain on financial instruments, net of tax (benefit) provision of $604, $606, $53 and $85 | 853 | 853 | |||
Pension liability adjustment, net of $4, $39, $0 and $142 tax provision (benefit) | 175 | 175 | |||
Balance at the end of period at Feb. 27, 2016 | $ 480 | 856,879 | (19,835) | (630,456) | 207,068 |
Balance (in shares) at Feb. 27, 2016 | 47,986,975 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 354 | 354 | |||
Stock-based compensation | 147 | $ 147 | |||
Stock option exercises (in shares) | 0 | ||||
Foreign currency translation adjustment | 4,053 | $ 4,053 | |||
Unrealized (loss) gain on financial instruments, net of tax (benefit) provision of $604, $606, $53 and $85 | 12 | 12 | |||
Pension liability adjustment, net of $4, $39, $0 and $142 tax provision (benefit) | (66) | (66) | |||
Balance at the end of period at Apr. 02, 2016 | $ 480 | 857,026 | (15,836) | (630,102) | 211,568 |
Balance (in shares) at Apr. 02, 2016 | 47,986,975 | ||||
Balance at the beginning of period at Feb. 27, 2016 | $ 480 | 856,879 | (19,835) | (630,456) | $ 207,068 |
Balance (in shares) at Feb. 27, 2016 | 47,986,975 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Stock option exercises (in shares) | 0 | ||||
Balance at the end of period at Apr. 01, 2017 | $ 480 | 859,102 | (22,643) | (615,149) | $ 221,790 |
Balance (in shares) at Apr. 01, 2017 | 48,045,114 | ||||
Balance at the beginning of period at Apr. 02, 2016 | $ 480 | 857,026 | (15,836) | (630,102) | 211,568 |
Balance (in shares) at Apr. 02, 2016 | 47,986,975 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 14,953 | 14,953 | |||
Stock-based compensation | 1,989 | 1,989 | |||
Excess tax provision from stock-based compensation | (9) | (9) | |||
Vesting of restricted stock awards | 31,216 | ||||
Taxes related to net share settlement of restricted stock awards | (39) | (39) | |||
Common stock granted to non-employees | 135 | 135 | |||
Common stock granted to non-employees (in shares) | 26,923 | ||||
Foreign currency translation adjustment | (6,283) | (6,283) | |||
Unrealized (loss) gain on financial instruments, net of tax (benefit) provision of $604, $606, $53 and $85 | (138) | (138) | |||
Pension liability adjustment, net of $4, $39, $0 and $142 tax provision (benefit) | (386) | (386) | |||
Balance at the end of period at Apr. 01, 2017 | $ 480 | $ 859,102 | $ (22,643) | $ (615,149) | $ 221,790 |
Balance (in shares) at Apr. 01, 2017 | 48,045,114 |
Consolidated statements of sha8
Consolidated statements of shareholders' equity (Parenthetical) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Apr. 02, 2016 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | Mar. 01, 2014 | |
Consolidated statements of shareholders' equity | |||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | ||
Unrealized (gain) loss on financial instruments, taxes | $ 7 | $ (85) | $ 606 | $ (604) | |
Pension liability adjustment, taxes | $ 0 | $ (142) | $ (39) | $ 4 |
Consolidated statements of cash
Consolidated statements of cash flows - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Apr. 02, 2016 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Operating activities | ||||
Net income | $ 354 | $ 14,953 | $ 5,142 | $ 22,673 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||
Depreciation and amortization | 3,009 | 37,124 | 34,230 | 31,011 |
Stock-based compensation | 147 | 1,989 | 1,556 | 1,289 |
Loss (gain) on disposal of assets | 57 | 61 | (3,487) | |
Deferred tax expense | 818 | (96) | 859 | 1,423 |
Noncash interest | 160 | 1,921 | 1,940 | 1,956 |
Other | 45 | (29) | 401 | (500) |
Changes in operating assets and liabilities: | ||||
Accounts receivable | 6,958 | (5,861) | (5,338) | 4,137 |
Inventory | 1,516 | (19,598) | (1,929) | (2,668) |
Prepaid expenses and other assets | (7,371) | 4,028 | 487 | 4,705 |
Accounts payable and accrued liabilities | (14,258) | 10,965 | 5,840 | 5,562 |
Income taxes | (719) | 3,527 | (1,330) | (2,582) |
Other noncurrent liabilities | (199) | (4,341) | 388 | 1,106 |
Net cash provided by (used in) operating activities | (9,540) | 44,639 | 42,307 | 64,625 |
Investing activities | ||||
Additions to property and equipment | (2,435) | (28,515) | (46,431) | (48,740) |
Proceeds from investment grant | 479 | |||
Proceeds from sale of subsidiary, net | 3,846 | |||
Proceeds from sale of property and equipment | 1 | 7 | 202 | 950 |
Net cash used in investing activities | (2,434) | (28,508) | (45,750) | (43,944) |
Financing activities | ||||
Borrowings on revolving lines of credit | 4,958 | 42,731 | 55,872 | 74,411 |
Payments on revolving lines of credit | (2,072) | (46,216) | (57,935) | (85,474) |
Borrowings on long-term debt | 5,000 | 30,000 | 33,000 | 34,389 |
Payments on long-term debt and capital leases | (944) | (40,496) | (38,246) | (36,591) |
Payment of debt issuance costs | (266) | |||
Proceeds from the exercise of stock options | 59 | 738 | ||
Net cash (used in) provided by financing activities | 6,942 | (13,981) | (7,516) | (12,527) |
Effect of exchange rate changes on cash | 232 | (223) | (426) | (1,206) |
Net increase (decrease) in cash | (4,800) | 1,927 | (11,385) | 6,948 |
Cash at beginning of fiscal year | 13,609 | 8,809 | 24,994 | 18,046 |
Cash at end of fiscal year | 8,809 | 10,736 | 13,609 | 24,994 |
Cash paid during the year for: | ||||
Interest | 3,552 | 14,656 | 14,850 | 15,255 |
Taxes | 236 | 7,651 | 891 | 7,192 |
Supplemental information for non-cash investing and financing activities: | ||||
Purchases of property and equipment (included in accounts payable) | 1,114 | 138 | 1,386 | 4,918 |
Capital lease obligation incurred | $ 60 | $ 691 | $ 541 | $ 513 |
Nature of business and summary
Nature of business and summary of significant accounting policies | 12 Months Ended |
Apr. 01, 2017 | |
Nature of business and summary of significant accounting policies | |
Nature of business and summary of significant accounting policies | 1. Nature of business and summary of significant accounting policies Description of business The Container Store, Inc. was founded in 1978 in Dallas, Texas, as a retailer with a mission to provide customers with storage and organization solutions through an assortment of innovative products and unparalleled customer service. In 2007, The Container Store, Inc. was sold to The Container Store Group, Inc. (the "Company"), a holding company, of which a majority stake was purchased by Leonard Green and Partners, L.P. ("LGP"), with the remainder held by certain employees of The Container Store, Inc. On November 6, 2013, the Company completed the initial public offering of its common stock (the "IPO"). As the majority shareholder, LGP retains controlling interest in the Company. The Container Store, Inc. consists of our retail stores, website and call center, as well as our installation and organizational services business. As of April 1, 2017, The Container Store, Inc. operated 86 stores with an average size of approximately 25,000 square feet (19,000 selling square feet) in 31 states and the District of Columbia. The Container Store, Inc. also offers all of its products directly to its customers through its website and call center. The Container Store, Inc.'s wholly owned Swedish subsidiary, Elfa International AB ("Elfa"), designs and manufactures component-based shelving and drawer systems that are customizable for any area of the home. elfa® branded products are sold exclusively in the United States in The Container Store® retail stores, website, and call center and Elfa sells to various retailers and distributors primarily in the Nordic region and throughout Europe on a wholesale basis. Basis of presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP). Basis of consolidation The consolidated financial statements include our accounts and those of the Company's wholly owned subsidiaries. The Company eliminates all significant intercompany balances and transactions, including intercompany profits, in consolidation. Fiscal year The Company follows a 4-4-5 fiscal calendar, whereby each fiscal quarter consists of thirteen weeks grouped into two four-week "months" and one five-week "month", and its fiscal year ends on the Saturday closest to March 31 st . Elfa's fiscal year ends on the last day of the calendar month of March. Prior to fiscal year 2016, the Company's fiscal year ended on the Saturday closest to February 28 th . All references herein to "fiscal 2016" represent the results of the 52-week fiscal year ended April 1, 2017, and references to "fiscal 2015" represent the results of the 52-week fiscal year ended February 27, 2016. In addition, all references herein to "fiscal 2014" represent the 52-week fiscal year ended February 28, 2015. Management estimates The preparation of the Company's consolidated financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses. Actual results could differ from those estimates. Significant accounting judgments and estimates include fair value estimates for indefinite-lived intangible assets, inventory loss reserve, assessments of long-lived asset impairments, gift card breakage, and assessment of valuation allowances on deferred tax assets. Revenue recognition Revenue from sales related to retail operations is recognized when the merchandise is delivered to the customer at the point of sale. Revenue from sales that are shipped or delivered directly to customers is recognized upon estimated delivery to the customer and includes applicable shipping or delivery revenue. Revenue from sales that are installed is recognized upon completion of the installation service to the customer and includes applicable installation revenue. Revenue from sales of other services is recognized upon the completion of the service. Revenue from sales related to manufacturing operations is recorded upon shipment. Sales are recorded net of sales taxes collected from customers. A sales return allowance is recorded for estimated returns of merchandise subsequent to the balance sheet date that relate to sales prior to the balance sheet date. The returns allowance is based on historical return patterns and reduces sales and cost of sales, accordingly. Merchandise exchanges of similar product and price are not considered merchandise returns and, therefore, are excluded when calculating the sales returns allowance. Gift cards and merchandise credits Gift cards are sold to customers in retail stores, through the call center and website, and through certain third parties. We issue merchandise credits in our stores and through our call center. Revenue from sales of gift cards and issuances of merchandise credits is recognized when the gift card is redeemed by the customer, or the likelihood of the gift card being redeemed by the customer is remote (gift card breakage). The gift card breakage rate is determined based upon historical redemption patterns. An estimate of the rate of gift card breakage is applied over the period of estimated performance (48 months as of the end of fiscal 2016) and the breakage amounts are included in net sales in the consolidated statement of operations. The Company recorded $1,072, $948, $978, and $73 of gift card breakage in fiscal years 2016, 2015, 2014, and the five weeks ended April 2, 2016, respectively. Cost of sales Cost of sales related to retail operations includes the purchase cost of inventory sold (net of vendor rebates), in-bound freight, as well as inventory loss reserves. Costs incurred to ship or deliver merchandise to customers, as well as direct installation and organization services costs, are also included in cost of sales. Cost of sales from manufacturing operations includes costs associated with production, including materials, wages, other variable production costs, and other applicable manufacturing overhead. Leases Rent expense on operating leases, including rent holidays and scheduled rent increases, is recorded on a straight-line basis over the term of the lease, commencing on the date the Company takes possession of the leased property. Rent expense is recorded in selling, general, and administrative expenses. Pre-opening rent expense is recorded in pre-opening costs in the consolidated income statement. The net excess of rent expense over the actual cash paid has been recorded as deferred rent in the accompanying consolidated balance sheets. Tenant improvement allowances are also included in the accompanying consolidated balance sheets as deferred rent liabilities and are amortized as a reduction of rent expense over the term of the lease from the possession date. Contingent rental payments, typically based on a percentage of sales, are recognized in rent expense when payment of the contingent rent is probable. Advertising All advertising costs of the Company are expensed when incurred, or upon the release of the initial advertisement, except for production costs related to catalogs and direct mailings to customers, which are initially capitalized. Production costs related to catalogs and direct mailings consist primarily of printing and postage and are expensed when mailed to the customer, except for direct mailings related to promotional campaigns, which are expensed over the period during which the promotional sales are expected to occur. Advertising costs are recorded in selling, general, and administrative expenses. Pre-opening advertising costs are recorded in pre-opening costs. Catalog and direct mailings costs capitalized at April 1, 2017 and February 27, 2016, amounted to $605 and $938 respectively, and are recorded in prepaid expenses on the accompanying consolidated balance sheets. Total advertising expense incurred for fiscal years 2016, 2015, 2014, and the five-weeks ended April 2, 2016 was $31,525, $32,343, $35,388, and $2,164, respectively. Pre-opening costs Non-capital expenditures associated with opening new stores, including rent, marketing expenses, travel and relocation costs, and training costs, are expensed as incurred and are included in pre-opening costs in the consolidated statement of operations. Income taxes We account for income taxes utilizing Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 740, Income Taxes . ASC 740 requires an asset and liability approach, which requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities. We recognize interest and penalties related to unrecognized tax benefits in income tax expense. There were no uncertain tax positions requiring accrual as of April 1, 2017 and February 27, 2016. Valuation allowances are established against deferred tax assets when it is more-likely-than-not that the realization of those deferred tax assets will not occur. Valuation allowances are released as positive evidence of future taxable income sufficient to realize the underlying deferred tax assets becomes available. Deferred tax assets and liabilities are measured using the enacted tax rates in effect in the years when those temporary differences are expected to reverse. The effect on deferred taxes from a change in the tax rate is recognized through continuing operations in the period that includes the enactment of the change. Changes in tax laws and rates could affect recorded deferred tax assets and liabilities in the future. We operate in certain jurisdictions outside the United States. ASC 740-30 provides that the undistributed earnings of a foreign subsidiary be accounted for as a temporary difference under the presumption that all undistributed earnings will be distributed to the parent company as a dividend. Sufficient evidence of the intent to permanently reinvest the earnings in the jurisdiction where earned precludes a company from recording the temporary difference. For purposes of ASC 740-30, we are partially reinvested in our Swedish subsidiary Elfa and thus do not record a temporary difference. We are partially reinvested since we have permanently reinvested our past earnings at Elfa; however, we do not assert that all future earnings will be reinvested into Elfa. Stock-based compensation The Company accounts for stock-based compensation in accordance ASC 718, Compensation-Stock Compensation , which requires the fair value of stock-based payments to be recognized in the consolidated financial statements as compensation expense over the requisite service period. For time-based awards, compensation expense is recognized on a straight line basis, net of forfeitures, over the requisite service period for awards that actually vest. For performance-based awards, compensation expense is estimated based on achievement of the performance condition and is recognized using the accelerated attribution method over the requisite service period for awards that actually vest. Stock-based compensation expense is recorded in the stock-based compensation line in the consolidated statements of operations. Stock Options The Board determines the exercise price of stock options based on the closing price of the Company's common stock as reported on The New York Stock Exchange on the grant date. The Company estimates the fair value of each stock option grant on the date of grant based upon the Black-Scholes option-pricing model. This model requires various significant judgmental assumptions in order to derive a final fair value determination for each type of award including: • Expected Term—The expected term of the options represents the period of time between the grant date of the options and the date the options are either exercised or canceled, including an estimate of options still outstanding. • Expected Volatility—The expected volatility incorporates historical and implied volatility of comparable public companies for a period approximating the expected term. • Expected Dividend Yield—The expected dividend yield is based on the Company's expectation of not paying dividends on its common stock for the foreseeable future. • Risk-Free Interest Rate—The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant and with a maturity that approximates the expected term. Restricted Stock Awards The fair value of each restricted stock award is determined based on the closing price of the Company's common stock as reported on The New York Stock Exchange on the grant date. Accounts receivable Accounts receivable consist primarily of trade receivables, receivables from The Container Store, Inc.'s credit card processors for sales transactions, and tenant improvement allowances from The Container Store, Inc.'s landlords in connection with new leases. An allowance for doubtful accounts is established on trade receivables, if necessary, for estimated losses resulting from the inability of customers to make required payments. Factors such as payment terms, historical loss experience, and economic conditions are generally considered in determining the allowance for doubtful accounts. Accounts receivable are presented net of allowances for doubtful accounts of $305 and $128 at April 1, 2017 and February 27, 2016, respectively. Inventories Inventories at retail stores are comprised of finished goods and are valued at the lower of cost or estimated net realizable value, with cost determined on a weighted-average cost method including associated freight costs. Manufacturing inventories are comprised of raw materials, work in process, and finished goods and are valued on a first-in, first out basis using full absorption accounting which includes material, labor, other variable costs, and other applicable manufacturing overhead. To determine if the value of inventory is recoverable at cost, we consider current and anticipated demand, customer preference and the merchandise age. The significant estimates used in inventory valuation are obsolescence (including excess and slow-moving inventory) and estimates of inventory shrinkage. We adjust our inventory for obsolescence based on historical trends, aging reports, specific identification and our estimates of future retail sales prices. Reserves for shrinkage are estimated and recorded throughout the period as a percentage of cost of sales based on historical shrinkage results and current inventory levels. Actual shrinkage is recorded throughout the year based upon periodic cycle counts. Actual inventory shrinkage can vary from estimates due to factors including the mix of our inventory and execution against loss prevention initiatives in our stores and distribution center. Property and equipment Property and equipment are recorded at cost less accumulated depreciation. Significant additions and improvements are capitalized, and expenditures for maintenance and repairs are expensed. Gains and losses on the disposition of property and equipment are recognized in the period incurred. Depreciation, including amortization of assets recorded under capital lease obligations, is provided using the straight-line method over the estimated useful lives of depreciable assets as follows: Buildings 30 years Furniture, fixtures, and equipment 3 to 10 years Computer software 2 to 5 years Leasehold improvements Shorter of useful life or lease term Capital leases Shorter of useful life or lease term Costs of developing or obtaining software for internal use or developing the Company's website, such as external direct costs of materials or services and internal payroll costs directly related to the software development projects are capitalized. For the fiscal years ended April 1, 2017, February 27, 2016, and February 28, 2015, the Company capitalized $4,392, $3,272, and $5,017, respectively, and amortized $3,498, $3,258, and $2,992, respectively, of costs in connection with the development of internally used software. For the five-week period ended April 2, 2016, the Company capitalized $299 and amortized $296 of costs in connection with the development of internally used software. Long-lived assets Long-lived assets, such as property and equipment and intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Conditions that may indicate impairment include, but are not limited to, a significant adverse change in customer demand or business climate that could affect the value of an asset, a product recall or an adverse action or assessment by a regulator. If the sum of the estimated undiscounted future cash flows related to the asset is less than the carrying value, we recognize a loss equal to the difference between the carrying value and the fair value, usually determined by the estimated discounted cash flow analysis of the asset. For our TCS segment, we generally evaluate long-lived tangible assets at a store level, or at the lowest level at which independent cash flows can be identified. We evaluate corporate assets or other long-lived assets that are not store-specific at the consolidated level. For our Elfa segment, we evaluate long-lived tangible assets at the segment level. Since there is typically no active market for our long-lived tangible assets, we estimate fair values based on the expected future cash flows. We estimate future cash flows based on store-level historical results, current trends, and operating and cash flow projections. Our estimates are subject to uncertainty and may be affected by a number of factors outside our control, including general economic conditions and the competitive environment. While we believe our estimates and judgments about future cash flows are reasonable, future impairment charges may be required if the expected cash flow estimates, as projected, do not occur or if events change requiring us to revise our estimates. Foreign currency forward contracts We account for foreign currency forward contracts in accordance with ASC 815, Derivatives and Hedging . In the TCS segment, we may utilize foreign currency forward contracts in Swedish krona to stabilize our retail gross margins and to protect our domestic operations from downward currency exposure by hedging purchases of inventory from our wholly owned subsidiary, Elfa. In the Elfa segment, we may utilize foreign currency forward contracts to hedge purchases of raw materials that are transacted in currencies other than Swedish krona, which is the functional currency of Elfa. Generally, the Company's foreign currency forward contracts have terms from 1 to 12 months and require the Company to exchange currencies at agreed-upon rates at settlement. The Company does not hold or enter into financial instruments for trading or speculative purposes. The Company records all foreign currency forward contracts on its consolidated balance sheet at fair value. The Company records its foreign currency forward contracts on a gross basis. Forward contracts not designated as hedges are adjusted to fair value through income as selling, general and administrative expenses. The Company accounts for its foreign currency hedge instruments as cash flow hedges, as defined. Changes in the fair value of the foreign currency hedge instruments that are considered to be effective, as defined, are recorded in other comprehensive income (loss) until the hedged item (inventory) is sold to the customer, at which time the deferred gain or loss is recognized through cost of sales. Any portion of a change in the foreign currency hedge instrument's fair value that is considered to be ineffective, as defined, or that the Company has elected to exclude from its measurement of effectiveness, is immediately recorded in earnings as cost of sales. Self-insured liabilities We are primarily self-insured for workers' compensation, employee health benefits and general liability claims. We record self-insurance liabilities based on claims filed, including the development of those claims, and an estimate of claims incurred but not yet reported. Factors affecting these estimates include future inflation rates, changes in severity, benefit level changes, medical costs and claim settlement patterns. Should a different amount of claims occur compared to what was estimated, or costs of the claims increase or decrease beyond what was anticipated, reserves may need to be adjusted accordingly. We determine our workers' compensation liability and general liability claims reserves based on an analysis of historical claims data. Self-insurance reserves for employee health benefits, workers' compensation and general liability claims are recorded in the accrued liabilities line item of the consolidated balance sheet and were $3,016 and $3,471 as of April 1, 2017 and February 27, 2016, respectively. Goodwill We evaluate goodwill annually to determine whether it is impaired. Goodwill is also tested between annual impairment tests if an event occurs or circumstances change that would indicate that the fair value of a reporting unit is less than its carrying amount. Conditions that may indicate impairment include, but are not limited to, a significant adverse change in customer demand or business climate that could affect the value of an asset. If an impairment indicator exists, we test goodwill for recoverability. We have identified two reporting units and we have selected the first day of the fourth fiscal quarter to perform our annual goodwill impairment testing. Prior to testing goodwill for impairment, we perform a qualitative assessment to determine whether it is more likely than not that goodwill is impaired for each reporting unit. If the results of the qualitative assessment indicate that the likelihood of impairment is greater than 50%, then we perform a two-step impairment test on goodwill. In the first step, we compare the fair value of the reporting unit to its carrying value. If the fair value of the reporting unit exceeds the carrying value of the net assets assigned to that unit, goodwill is considered not impaired and we are not required to perform further testing. If the carrying value of the net assets assigned to the reporting unit exceeds the fair value of the reporting unit, then we must perform the second step of the impairment test in order to determine the implied fair value of the reporting unit's goodwill. If the carrying value of a reporting unit's goodwill exceeds its implied fair value, then we would record an impairment loss equal to the difference. The fair value of each reporting unit is determined by using a discounted cash flow analysis using the income approach. We also use a market approach to compare the estimated fair value to comparable companies. The determination of fair value requires assumptions and estimates of many critical factors, including among others, our nature and our history, financial and economic conditions affecting us, our industry and the general economy, past results, our current operations and future prospects, sales of similar businesses or capital stock of publicly held similar businesses, as well as prices, terms and conditions affecting past sales of similar businesses. Forecasts of future operations are based, in part, on operating results and management's expectations as to future market conditions. These types of analyses contain uncertainties because they require management to make assumptions and to apply judgments to estimate industry economic factors and the profitability of future business strategies. If actual results are not consistent with our estimates and assumptions, we may be exposed to future impairment losses that could be material. Trade names We annually evaluate whether the trade names continue to have an indefinite life. Trade names are reviewed for impairment annually on the first day of the fourth fiscal quarter and may be reviewed more frequently if indicators of impairment are present. Conditions that may indicate impairment include, but are not limited to, a significant adverse change in customer demand or business climate that could affect the value of an asset, a product recall or an adverse action or assessment by a regulator. The impairment review is performed by comparing the carrying value to the estimated fair value, determined using a discounted cash flow methodology. If the recorded carrying value of the trade name exceeds its estimated fair value, an impairment charge is recorded to write the trade name down to its estimated fair value. Factors used in the valuation of intangible assets with indefinite lives include, but are not limited to, future revenue growth assumptions, estimated market royalty rates that could be derived from the licensing of our trade names to third parties, and a rate used to discount the estimated royalty cash flow projections. The valuation of trade names requires assumptions and estimates of many critical factors, which are consistent with the factors discussed under "Goodwill" above. Forecasts of future operations are based, in part, on operating results and management's expectations as to future market conditions. These types of analyses contain uncertainties because they require management to make assumptions and to apply judgments to estimate industry economic factors and the profitability of future business strategies. If actual results are not consistent with our estimates and assumptions, we may be exposed to future impairment losses that could be material. Foreign currency translation The Company operates foreign subsidiaries in the following countries: Sweden, Norway, Finland, Denmark, Germany, Poland, and France. The functional currency of the Company's foreign operations is the applicable country's currency. All assets and liabilities of foreign subsidiaries and affiliates are translated at year-end rates of exchange. Revenues and expenses of foreign subsidiaries and affiliates are translated at average rates of exchange for the year. Unrealized gains and losses on translation are reported as cumulative translation adjustments through other comprehensive income (loss). The functional currency for the Company's wholly owned subsidiary, Elfa, is the Swedish krona. During fiscal 2016, the rate of exchange from U.S. dollar to Swedish krona increased from 8.6 to 8.9. The carrying amount of assets related to Elfa and subject to currency fluctuation was $108,707 and $109,548 as of April 1, 2017 and February 27, 2016, respectively. Foreign currency realized gains of $342, realized losses of $241, realized gains of $171, and realized gains of $60 are included in selling, general, and administrative expenses in the consolidated statements of operations in fiscal 2016, fiscal 2015, fiscal 2014, and the five-weeks ended April 2, 2016, respectively. Recent accounting pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) , to revise lease accounting guidance. The update requires most leases to be recorded on the balance sheet as a lease liability, with a corresponding right-of-use asset, whereas these leases currently have an off-balance sheet classification. ASU 2016-02 must be applied on a modified retrospective basis and is effective for fiscal years beginning after December 15, 2018, and interim periods within those years, with early adoption permitted. The Company currently intends to adopt this standard in the first quarter of fiscal 2019. The Company is still evaluating the impact of implementation of this standard on its financial statements, but expects that adoption will have a material impact to the Company's total assets and liabilities given the Company has a significant number of operating leases not currently recognized on its balance sheet. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers , an updated standard on revenue recognition. ASU 2014-09 provides enhancements to the quality and consistency of how revenue is reported while also improving comparability in the financial statements of companies reporting using IFRS and GAAP. The core principle of the new standard is for companies to recognize revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration (that is, payment) to which the Company expects to be entitled in exchange for those goods or services. The new standard also will result in enhanced disclosures about revenue, provide guidance for transactions that were not previously addressed comprehensively (for example, service revenue and contract modifications) and improve guidance for multiple-element arrangements. In July 2015, the FASB deferred the effective date of ASU 2014-09. Accordingly, this standard is effective for reporting periods beginning after December 15, 2017, including interim periods within that fiscal year, with early adoption permitted for interim and annual periods beginning after December 15, 2016. The Company currently intends to adopt this standard in the first quarter of fiscal 2018. This guidance can be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption, but the Company has not yet selected a transition method. The Company has identified certain impacts to our accounting for gift cards given away for promotional or marketing purposes. Under current GAAP, the value of promotional gift cards are recorded as selling, general, and administrative expense. The new standard requires these types of gift cards to be accounted for as a reduction of revenue (i.e. a discount). The Company does not expect the adoption of ASU 2014-09 to have a material impact on the financial statements. In March 2016, the FASB issued ASU 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting , which outlines new provisions intended to simplify various aspects related to accounting for share-based payments, including income tax consequences, forfeitures, and classification in the statement of cash flows. This ASU is effective for fiscal years beginning after December 15, 2016, and interim periods within those years, with early adoption permitted. The Company does not expect this standard to have a material impact on its financial statements and currently intends to adopt this standard in the first quarter of fiscal 2017. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory , which requires entities to recognize the income tax effects of intercompany sales and transfers of assets, other than inventory, in the period in which the transfer occurs. This is a change from current GAAP, which requires entities to defer the income tax effects of intercompany transfers of assets until the asset has been sold to an outside party or otherwise recognized (i.e. depreciated, amortized, impaired). The income tax effects of intercompany sales and transfers of inventory will continue to be deferred until the inventory is sold to an outside party. This ASU is effective for fiscal years beginning after December 15, 2017, and interim periods within those years, with early adoption permitted. The Company does not expect this standard to have a material impact on its financial statements. In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment , which provides guidance to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test under ASC Topic 350. Under the new guidance, an entity should perform goodwill impairment testing by comparing the fair value of a reporting unit with its carrying amount. If the a reporting unit's carrying amount exceeds its fair value, an entity should recognize an impairment charge based on that difference, limited to the total amount of goodwill allocated to that reporting unit. This ASU will be applied prospectively and is effective for annual and interim impairment tests performed in periods beginning after December 15, 2019. Early adoption is permitted for annual and interim goodwill impairment testing dates after January 1, 2017. The Company does not expect this standard to have a material impact on its f |
Goodwill and trade names
Goodwill and trade names | 12 Months Ended |
Apr. 01, 2017 | |
Goodwill and trade names | |
Goodwill and trade names | 2. Goodwill and trade names During the quarter ended October 1, 2016, the Company voluntarily changed the date of its annual goodwill and indefinite-lived intangible assets impairment testing from the last day of fiscal December (which is also the last day of the third fiscal quarter) to the first day of the fourth fiscal quarter. This voluntary change is preferable under the circumstances as it provides the Company with sufficient time to complete its annual goodwill and indefinite-lived intangible asset impairment testing in advance of its year-end reporting and results in better alignment with the Company's annual planning and forecasting process. In connection with the change in the date of the annual goodwill and indefinite-lived intangible impairment tests, the Company performed goodwill and indefinite-lived intangible impairment tests as of the last day of the 2016 fiscal third quarter and as of the first day of the 2016 fiscal fourth quarter, and no impairment was identified on either date. The voluntary change in accounting principle related to the annual testing date will not delay, accelerate or avoid an impairment charge. The Company has determined that it is impracticable to objectively determine projected cash flows and related valuation estimates that would have been used as of the first day of the fiscal fourth quarter for periods prior to fiscal 2016 without the use of hindsight. As such, the Company will prospectively apply the change in the annual goodwill and indefinite-lived intangible assets impairment assessment as of the first day of the fourth fiscal quarter of 2016. The estimated goodwill and trade name fair values are computed using estimates as of the measurement date, which is defined as the first day of the fiscal fourth quarter. The Company makes estimates and assumptions about sales, gross margins, profit margins, and discount rates based on budgets and forecasts, business plans, economic projections, anticipated future cash flows, and marketplace data. Assumptions are also made for varying perpetual growth rates for periods beyond the long-term business plan period. There are inherent uncertainties related to these factors and management's judgment in applying these factors. Another estimate using different, but still reasonable, assumptions could produce different results. As there are numerous assumptions and estimations utilized to derive the estimated enterprise fair value of each reporting unit, it is possible that actual results may differ from estimated results requiring future impairment charges. The Company recorded no impairments during fiscal 2016, fiscal 2015, and fiscal 2014 as a result of the goodwill and trade names impairment tests performed. The changes in the carrying amount of goodwill and trade names were as follows in fiscal 2016, the five weeks ended April 2, 2016, and fiscal 2015: Goodwill Trade names Balance at February 28, 2015 Gross balance Accumulated impairment charges ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total, net $ $ Foreign currency translation adjustments — ) Balance at February 27, 2016 Gross balance Accumulated impairment charges ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total, net $ $ Foreign currency translation adjustments — Balance at April 2, 2016 Gross balance Accumulated impairment charges ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total, net $ $ Foreign currency translation adjustments — ) Balance at April 1, 2017 Gross balance Accumulated impairment charges ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total, net $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Detail of certain balance sheet
Detail of certain balance sheet accounts | 12 Months Ended |
Apr. 01, 2017 | |
Detail of certain balance sheet accounts | |
Detail of certain balance sheet accounts | 3. Detail of certain balance sheet accounts April 1, February 27, Accounts receivable, net: Trade receivables, net $ $ Credit card receivables Tenant allowances Other receivables ​ ​ ​ ​ ​ ​ ​ ​ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Inventory: Finished goods $ $ Raw materials Work in progress ​ ​ ​ ​ ​ ​ ​ ​ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Property and equipment, net: Land and buildings $ $ Furniture and fixtures Machinery and equipment Computer software and equipment Leasehold improvements Construction in progress Leased vehicles and other ​ ​ ​ ​ ​ ​ ​ ​ Less accumulated depreciation and amortization ) ) ​ ​ ​ ​ ​ ​ ​ ​ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accrued Liabilities: Accrued payroll, benefits and bonuses $ $ Unearned revenue Accrued transaction and property tax Gift cards and store credits outstanding Accrued lease liabilities Accrued interest Other accrued liabilities ​ ​ ​ ​ ​ ​ ​ ​ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Long-term debt and revolving li
Long-term debt and revolving lines of credit | 12 Months Ended |
Apr. 01, 2017 | |
Long-term debt and revolving lines of credit | |
Long-term debt and revolving lines of credit | 4. Long-term debt and revolving lines of credit Long-term debt and revolving lines of credit consist of the following: April 1, February 27, Senior secured term loan facility $ $ 2014 Elfa term loan facility 2014 Elfa revolving credit facility — Obligations under capital leases Other loans Revolving credit facility — — ​ ​ ​ ​ ​ ​ ​ ​ Total debt Less current portion ) ) Less deferred financing costs(1) ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total long-term debt $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Represents deferred financing costs related to our Senior Secured Term Loan Facility, which are presented net of long-term debt in the consolidated balance sheet. Scheduled total revolving lines of credit and debt maturities for the fiscal years subsequent to April 1, 2017, are as follows: Within 1 year $ 2 years 3 years 4 years — 5 years — Thereafter — ​ ​ ​ ​ ​ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Senior Secured Term Loan Facility On April 6, 2012, The Container Store Group, Inc., The Container Store, Inc. and certain of its domestic subsidiaries entered into a credit agreement with JPMorgan Chase Bank, N.A., as Administrative Agent and Collateral Agent, and the lenders party thereto (as amended, the "Senior Secured Term Loan Facility"). Under the Senior Secured Term Loan Facility, we had $316,760 in outstanding borrowings as of April 1, 2017 and the interest rate on such borrowings is LIBOR + 3.25%, subject to a LIBOR floor of 1.00%. The Senior Secured Term Loan Facility provides that we are required to make quarterly principal repayments of $906 through December 31, 2018, with a balloon payment for the remaining balance due on April 6, 2019. The Senior Secured Term Loan Facility is secured by (a) a first priority security interest in substantially all of our assets (excluding stock in foreign subsidiaries in excess of 65%, assets of non-guarantors and subject to certain other exceptions) (other than the collateral that secures the Revolving Credit Facility described below on a first-priority basis) and (b) a second priority security interest in the assets securing the Revolving Credit Facility described below on a first-priority basis. Obligations under the Senior Secured Term Loan Facility are guaranteed by The Container Store Group, Inc. and each of The Container Store, Inc.'s U.S. subsidiaries. Under the Senior Secured Term Loan Facility, the Company is required to make quarterly principal repayments of $906 through December 31, 2018, with a balloon payment for the remaining balance of $310,420 due on April 6, 2019. The Senior Secured Term Loan Facility includes restrictions on the ability of the Company's subsidiaries to incur additional liens and indebtedness, make investments and dispositions, pay dividends or make other distributions, make loans, prepay certain indebtedness and enter into sale and lease back transactions, among other restrictions. Under the Senior Secured Term Loan Facility, provided no event of default has occurred and is continuing, The Container Store, Inc. is permitted to pay dividends to The Container Store Group, Inc. in an amount not to exceed the sum of $10,000 plus if after giving effect to such dividend on a pro forma basis, the Consolidated Leverage Ratio (as defined in the Senior Secured Term Loan Facility) does not exceed 2.0 to 1.0, the Available Amount (as defined in the Senior Secured Term Loan Facility) during the term of the Senior Secured Term Loan Facility, and pursuant to certain other limited exceptions. The restricted net assets of the Company's consolidated subsidiaries was $209,290 as of April 1, 2017. As of April 1, 2017, we were in compliance with all Senior Secured Term Loan Facility covenants and no Event of Default (as such term is defined in the Senior Secured Term Loan Facility) had occurred. Revolving Credit Facility On April 6, 2012, The Container Store Group, Inc., The Container Store, Inc. and certain of its domestic subsidiaries entered into an asset-based revolving credit agreement with the lenders party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent and Collateral Agent, and Wells Fargo Bank, National Association, as Syndication Agent (as amended, the "Revolving Credit Facility"). The aggregate principal amount of the facility is $100,000. Borrowings under the Revolving Credit Facility accrue interest at LIBOR+1.25% and the maturity date is the earlier of (x) October 8, 2020 and (y) January 6, 2019, if any of The Container Store, Inc.'s obligations under its term loan credit facility remain outstanding on such date and have not been refinanced with debt that has a final maturity date that is no earlier than April 6, 2019 or subordinated debt. In addition, the Revolving Credit Facility includes an uncommitted incremental revolving facility in the amount of $50,000, which is subject to receipt of lender commitments and satisfaction of specified conditions. The Revolving Credit Facility provides that proceeds are to be used for working capital and other general corporate purposes, and allows for swing line advances of up to $15,000 and the issuance of letters of credit of up to $40,000. The availability of credit at any given time under the Revolving Credit Facility is limited by reference to a borrowing base formula, which is the sum of (i) 90% of eligible credit card receivables and (ii) 90% of the appraised value of eligible inventory; minus (iii) certain availability reserves and (iv) outstanding credit extensions including letters of credit and existing revolving loans. The Revolving Credit Facility is secured by (a) a first-priority security interest in substantially all of our personal property, consisting of inventory, accounts receivable, cash, deposit accounts, and other general intangibles, and (b) a second-priority security interest in the collateral that secures the Senior Secured Term Loan Facility on a first-priority basis, as described above (excluding stock in foreign subsidiaries in excess of 65%, and assets of non-guarantor subsidiaries and subject to certain other exceptions). Obligations under the Revolving Credit Facility are guaranteed by The Container Store Group, Inc. and each of The Container Store, Inc.'s U.S. subsidiaries. The Revolving Credit Facility contains a number of covenants that, among other things, restrict our ability, subject to specified exceptions, to incur additional debt; incur additional liens and contingent liabilities; sell or dispose of assets; merge with or acquire other companies; liquidate or dissolve ourselves, engage in businesses that are not in a related line of business; make loans, advances or guarantees; engage in transactions with affiliates; and make investments. In addition, the financing agreements contain certain cross-default provisions. We are required to maintain a consolidated fixed-charge coverage ratio of 1.0 to 1.0 if excess availability is less than $10,000 at any time. As of April 1, 2017, we were in compliance with all Revolving Credit Facility covenants and no Event of Default (as such term is defined in the Revolving Credit Facility) had occurred. Under the Revolving Credit Facility, provided no event of default has occurred and is continuing, The Container Store, Inc. is permitted to pay dividends to The Container Store Group, Inc., in an amount not to exceed the sum of $10,000 plus if after giving effect to such dividend on a pro forma basis, the Consolidated Fixed Charge Coverage Ratio (as defined in the Revolving Credit Facility) is not less than 1.25 to 1.0, the Available Amount (as defined in the Revolving Credit Facility) during the term of the Revolving Credit Facility, and pursuant to certain other limited exceptions. There was $73,189 available under the Revolving Credit Facility as of April 1, 2017, based on the factors described above. Maximum borrowings, including letters of credit issued under the Revolving Credit Facility during the period ended April 1, 2017, were $33,590. Elfa Senior Secured Credit Facilities and 2014 Elfa Senior Secured Credit Facilities On April 27, 2009, Elfa entered into the Elfa Senior Secured Credit Facilities with Tjustbygdens Sparbank AB, which we refer to as Sparbank, which consisted of a SEK 137.5 million term loan facility, which we refer to as the Elfa Term Loan Facility, and the SEK 175.0 million Elfa Revolving Credit Facility and, together with the Elfa Term Loan Facility, the Elfa Senior Secured Credit Facilities. On January 27, 2012, Sparbank transferred all of its commitments, rights and obligations under the Elfa Senior Secured Credit Facilities to Swedbank AB. Borrowings under the Elfa Senior Secured Credit Facilities accrued interest at a rate of STIBOR+1.775%. Elfa was required to make quarterly principal repayments under the Elfa Term Loan Facility of SEK 6.25 million through maturity. The Elfa Senior Secured Credit Facilities were secured by first priority security interests in substantially all of Elfa's assets. The Elfa Term Loan Facility and the Elfa Revolving Credit Facility matured on August 30, 2014 and were replaced with the 2014 Elfa Senior Secured Credit Facilities as discussed below. On April 1, 2014, Elfa entered into a master credit agreement with Nordea Bank AB ("Nordea"), which consists of a SEK 60.0 million (approximately $6,715 as of April 1, 2017) term loan facility (the "2014 Elfa Term Loan Facility") and a SEK 140.0 million (approximately $15,669 as of April 1, 2017) revolving credit facility (the "2014 Elfa Revolving Credit Facility," and together with the 2014 Elfa Term Loan Facility, the "2014 Elfa Senior Secured Credit Facilities"). The 2014 Elfa Senior Secured Credit Facilities term began on August 29, 2014 and matures on August 29, 2019. Elfa is required to make quarterly principal payments under the 2014 Elfa Term Loan Facility in the amount of SEK 3.0 million (approximately $336 as of April 1, 2017) through maturity. The 2014 Elfa Term Loan Facility bears interest at STIBOR + 1.7% and the 2014 Elfa Revolving Credit Facility bears interest at Nordea's base rate + 1.4%. In the fourth quarter of fiscal 2016, Elfa and Nordea agreed that the stated rates would apply through maturity. As of April 1, 2017, the Company had $15,669 of additional availability under the 2014 Elfa Revolving Credit Facility. Under the 2014 Elfa Senior Secured Credit Facilities, Elfa's ability to pay dividends to its parent entity, The Container Store, Inc., is based on its future net income and on historical intercompany practices as between Elfa and The Container Store, Inc. The 2014 Elfa Senior Secured Credit Facilities are secured by the majority of assets of Elfa. The 2014 Elfa Senior Secured Credit Facilities contains a number of covenants that, among other things, restrict Elfa's ability, subject to specified exceptions, to incur additional liens, sell or dispose of assets, merge with other companies, engage in businesses that are not in a related line of business and make guarantees. In addition, Elfa is required to maintain (i) a consolidated equity ratio (as defined in the 2014 Elfa Senior Secured Credit Facilities) of not less than 30% in year one and not less than 32.5% thereafter and (ii) a consolidated ratio of net debt to EBITDA (as defined in the 2014 Elfa Senior Secured Credit Facilities) of less than 3.2, the consolidated equity ratio tested at the end of each calendar quarter and the ratio of net debt to EBITDA tested as of the end of each fiscal quarter. As of April 1, 2017, Elfa was in compliance with all covenants and no Event of Default (as defined in the 2014 Elfa Senior Secured Credit Facilities) had occurred. On May 13, 2014, Elfa entered into a credit facility with Nordea for SEK 15.0 million (the "Short Term Credit Facility"). The Short Term Credit Facility accrued interest at 2.53% and matured on August 28, 2014, at which time all borrowings under the agreement were paid in full to Nordea (approximately $2,152 as of August 28, 2014). The total amount of borrowings available under the Short Term Credit Facility was used to pay a mortgage owed on the Poland manufacturing facility in full in the first quarter of fiscal 2014. Deferred financing costs The Company capitalizes certain costs associated with issuance of various debt instruments. In the first quarter of fiscal 2016, the Company adopted ASU 2015-03 and ASU 2015-15 on a retrospective basis. As a result, the Company reclassified net deferred financing costs related to our Senior Secured Term Loan Facility to be presented in the balance sheet as a reduction of long-term debt, net of deferred financing costs, while net deferred financing costs related to our Revolving Credit Facility remain an asset in the deferred financing costs line item. These deferred financing costs are amortized to interest expense on a straight-line method, which is materially consistent with the effective interest method, over the terms of the related debt agreements. Amortization expense of deferred financing costs was $1,921, $1,940, $1,956, and $160 in fiscal 2016, fiscal 2015, fiscal 2014, and the five weeks ended April 2, 2016, respectively. The following is a schedule of amortization expense of deferred financing costs: Senior Secured Revolving Total Within 1 year $ $ $ 2 years 3 years — 4 years — 5 years — — — Thereafter — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Income taxes
Income taxes | 12 Months Ended |
Apr. 01, 2017 | |
Income taxes | |
Income taxes | 5. Income taxes Components of the provision for income taxes are as follows: Fiscal Year Five Weeks April 1, February 27, February 28, Income before income taxes: U.S. $ $ $ $ Foreign ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current Federal $ $ ) $ $ State Foreign ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total current provision ) Deferred Federal State ) Foreign ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total deferred provision (benefit) ) Total provision for income taxes $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The differences between the actual provision for income taxes and the amounts computed by applying the statutory federal tax rate to income before taxes are as follows: Fiscal Year Ended Five Weeks April 1, February 27, February 28, Provision computed at federal statutory rate $ $ $ $ Permanent differences Change in valuation allowance ) State income taxes, net of federal benefit Effect of foreign income taxes ) ) ) Prior period error — — ) — Non-taxable gain on sale of Norwegian subsidiary — — ) — Economic zone credits — ) ) — Other, net ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Components of deferred tax assets and liabilities as of April 1, 2017 and February 27, 2016, are as follows: April 1, February 27, Deferred tax assets: Inventory $ $ Loss and credit carryforwards Stock compensation Accrued liabilities Capital assets ​ ​ ​ ​ ​ ​ ​ ​ Valuation allowance ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total deferred tax assets Deferred tax liabilities: Intangibles ) ) Capital assets ) ) Other ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total deferred tax liabilities ) ) Net deferred tax liabilities $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The Company has recorded deferred tax assets and liabilities based upon estimates of their realizable value with such estimates based upon likely future tax consequences. In assessing the need for a valuation allowance, the Company considers both positive and negative evidence related to the likelihood of realization of the deferred tax assets. If, based on the weight of available evidence, it is more-likely-than-not that a deferred tax asset will not be realized, the Company records a valuation allowance. Prior to the fourth quarter of 2016, the Company maintained a valuation allowance against French deferred tax assets. During fiscal 2016, significant positive evidence provided assurance that the French deferred tax assets will more-likely-than-not be realized. Accordingly, in the fourth quarter of fiscal 2016, the Company released all valuation allowances it had previously maintained against French deferred tax assets. The release resulted in a $100 benefit to the Company's provision for income taxes. Foreign and domestic tax credits, net of valuation allowances, totaled approximately $1,490 at April 1, 2017 and approximately $1,661 at February 27, 2016. The various credits available at April 1, 2017 expire in the 2026 tax year. The Company had deferred tax assets for foreign and state net operating loss carryovers of $1,955 at April 1, 2017, and approximately $1,888 at February 27, 2016. Valuation allowances of $1,753 and $1,687 were recorded against the net operating loss deferred tax assets at April 1, 2017 and February 27, 2016, respectively. The Company is subject to U.S. federal income tax examinations for the year ended March 1, 2014 and forward. The Company is currently under an Internal Revenue Service audit for the tax year ended March 1, 2014. The Company accounts for the repatriation of foreign earnings in accordance with ASC 740-30. As such, the Company is partially reinvested based on the guidance provided in ASC 740-30. Undistributed earnings of approximately $33,237 at April 1, 2017 and approximately $33,149 at February 27, 2016, which represents all of the Company's undistributed earnings, have been indefinitely reinvested; therefore, no provision has been made for taxes due upon remittance of those earnings. The increase in undistributed earnings from fiscal 2015 to fiscal 2016 was primarily related to the translation of foreign earnings from Swedish krona to U.S. dollar. Determination of the unrecognized deferred tax liability related to these undistributed earnings is not practicable because of the complexities associated with its hypothetical calculation. The Company does not have any uncertain tax positions, according to ASC 740-10, as of April 1, 2017 and February 27, 2016. |
Employee benefit plans
Employee benefit plans | 12 Months Ended |
Apr. 01, 2017 | |
Employee benefit plans | |
Employee benefit plans | 6. Employee benefit plans 401(k) Plan All domestic employees of the Company who complete 11 months of service are eligible to participate in the Company's 401(k) Plan. Participants may contribute up to 80% of annual compensation, limited to eighteen thousand annually (twenty-four thousand for participants aged 50 years and over) as of January 1, 2016. During fiscal 2015 and fiscal 2014, the Company matched 100% of employee contributions up to 4% of compensation. Effective April 15, 2016, the Company temporarily ceased 401(k) matching contributions. The amount charged to expense for the Company's matching contribution was $58, $3,165, $2,737, and $309 for fiscal 2016, fiscal 2015, fiscal 2014, and the five weeks ended April 2, 2016, respectively. Nonqualified retirement plan The Company has a nonqualified retirement plan whereby certain employees can elect to defer a portion of their compensation into retirement savings accounts. Under the plan, there is no requirement that the Company match contributions, although the Company may contribute matching payments at its sole discretion. No matching contributions were made to the plan during any of the periods presented. The total fair value of the plan asset recorded in other current assets was $5,092 and $3,947 as of April 1, 2017 and February 27, 2016, respectively. The total carrying value of the plan liability recorded in accrued liabilities was $5,086 and $3,962 as of April 1, 2017 and February 27, 2016, respectively. Pension plan The Company provides pension benefits to the employees of Elfa under collectively bargained pension plans in Sweden, which are recorded in other long-term liabilities. The defined benefit plan provides benefits for participating employees based on years of service and final salary levels at retirement. Certain employees also participate in defined contribution plans for which Company contributions are determined as a percentage of participant compensation. The defined benefit plans are unfunded and approximately 3% of Elfa employees are participants in the defined benefit pension plan. The following is a reconciliation of the changes in the defined benefit obligations, a statement of funded status, and the related weighted-average assumptions: April 1, February 27, Change in benefit obligation: Projected benefit obligation, beginning of year $ $ Service cost Interest cost Benefits paid ) ) Actuarial loss (gain) ) Exchange rate gain ) ) ​ ​ ​ ​ ​ ​ ​ ​ Projected benefit obligation, end of year Fair value of plan assets, end of year — — ​ ​ ​ ​ ​ ​ ​ ​ Underfunded status, end of year $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ Discount rate % % Rate of pay increases % % ​ ​ ​ ​ ​ ​ ​ ​ The following table provides the components of net periodic benefit cost for fiscal years 2016, 2015, 2014 and the five weeks ended April 2, 2016: Fiscal Year Ended Five Weeks April 1, February 27, February 28, Components of net periodic benefit cost: Defined benefit plans: Service cost $ $ $ $ Interest cost Amortization of unrecognized net loss — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net periodic benefit cost for defined benefit plan Defined contribution plans ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total net periodic benefit cost $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Stock-based compensation
Stock-based compensation | 12 Months Ended |
Apr. 01, 2017 | |
Stock-based compensation | |
Stock-based compensation | 7. Stock-based compensation On October 16, 2013, the Board approved the 2013 Incentive Award Plan ("2013 Equity Plan"). The 2013 Equity Plan provides for grants of nonqualified stock options, incentive stock options, restricted stock, restricted stock units, deferred stock awards, deferred stock units, stock appreciation rights, dividends equivalents, performance awards, and stock payments. As of April 1, 2017, there are 3,616,570 shares authorized and 522,004 shares available for grant under the 2013 Equity Plan. Awards that are surrendered or terminated without issuance of shares are available for future grants. Stock Options On September 1, 2014, the Company granted 24,649 nonqualified stock options under the 2013 Equity Plan to certain employees. The stock options granted vest in equal annual installments over 7 years. The stock options granted were approved by the Board and consisted of nonqualified stock options as defined by the IRS for corporate and individual tax reporting purposes. On October 27, 2014, the Company granted 80,200 nonqualified stock options under the 2013 Equity Plan to non-employee directors of the Company. The stock options granted vest in equal annual installments over 3 years. The stock options granted were approved by the Board and consisted of nonqualified stock options as defined by the IRS for corporate and individual tax reporting purposes. On August 3, 2015, the Company granted 94,568 nonqualified stock options under the 2013 Equity Plan to non-employee directors of the Company. The stock options granted vest in equal annual installments over 3 years. The stock options granted were approved by the Board and consisted of nonqualified stock options as defined by the IRS for corporate and individual tax reporting purposes. On August 1, 2016, the Company granted 276,075 nonqualified stock options under the 2013 Equity Plan to non-employee directors of the Company. The stock options granted vest in equal annual installments over 3 years. The stock options granted were approved by the Board and consisted of nonqualified stock options as defined by the IRS for corporate and individual tax reporting purposes. In connection with our stock-based compensation plans, the Board considers the estimated fair value of the Company's stock when setting the stock option exercise price as of the date of each grant. The Board determines the exercise price of stock options based on the closing price of the Company's common stock as reported on The New York Stock Exchange on the grant date. Stock-based compensation cost is measured at the grant date fair value and is recognized as an expense in the consolidated statements of operations, on a straight-line basis, over the employee's requisite service period (generally the vesting period of the equity grant). The Company estimates forfeitures for option grants that are not expected to vest. The Company issues new shares of common stock upon stock option exercise. Stock-based compensation cost related to stock options was $1,526, $1,556, $1,289, and $147 during the fiscal year 2016, 2015, 2014, and the five weeks ended April 2, 2016, respectively. As of April 1, 2017, there was a remaining unrecognized compensation cost of $4,257 (net of estimated forfeitures) that the Company expects to be recognized on a straight-line basis over a weighted-average remaining service period of approximately 1.7 years. The intrinsic value of shares exercised was $0, $2, and $369 during fiscal 2016, 2015, and 2014, respectively. The fair value of shares vested was $1,464, $1,367 , and $1,205 during fiscal 2016, 2015, and 2014, respectively. The following table summarizes the Company's stock option activity during fiscal 2016, 2015, and 2014: Fiscal Year 2016(1) 2015 2014 Shares Weighted- Weighted- Aggregate Shares Weighted- Weighted- Aggregate Shares Weighted- Weighted- Aggregate Beginning balance $ $ $ Granted $ $ $ Exercised — $ — ) $ ) $ Forfeited ) $ ) $ ) $ Expired ) $ ) $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ending balance $ $ — $ $ — $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Vested and exercisable at end of year $ $ — $ $ — $ $ (1) Fiscal 2016 includes 6,690 options forfeited and 576 options expired during the five-weeks ended April 2, 2016. There were no options granted or exercised during the five-weeks ended April 2, 2016. The fair value of stock options is estimated on the date of the grant using the Black-Scholes option pricing model with the following weighted-average assumptions: • Expected Term—The expected term of the options represents the period of time between the grant date of the options and the date the options are either exercised or canceled, including an estimate of options still outstanding. The Company utilized the simplified method for calculating the expected term for stock options as we do not have sufficient historical data to calculate based on actual exercise and forfeiture activity. • Expected Volatility—The expected volatility incorporates historical and implied volatility of comparable public companies for a period approximating the expected term. • Expected Dividend Yield—The expected dividend yield is based on the Company's expectation of not paying dividends on its common stock for the foreseeable future. • Risk-Free Interest Rate—The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant and with a maturity that approximates the expected term. Stock options granted during fiscal year 2016, 2015, and 2014 were granted at a weighted-average grant date fair value of $3.26, $8.46, and $8.14, respectively. Such amounts were estimated using the Black Scholes option pricing model with the following weighted-average assumptions: Fiscal Year 2016 2015 2014 Expected term 6.0 years 6.0 years 6.1 years Expected volatility 67.9% 50.3% 50.4% Risk-free interest rate 1.2% 1.7% 1.8% Dividend yield 0% 0% 0% Restricted Stock Awards On July 1, 2016, the Company granted time-based and performance-based restricted stock awards under the Company's 2013 Incentive Award Plan to certain key executives in accordance with employment agreements executed on May 6, 2016. The total number of restricted shares granted was 372,842 with a grant-date fair value of $5.42. The time-based restricted shares vest over 2.75 years. The performance-based restricted shares vest based on achievement of fiscal 2016 performance targets and are also subject to time-based vesting requirements over 3.75 years. On April 1, 2017, 104,320 performance-based restricted shares met the fiscal 2016 performance condition and are subject to subsequent time-based vesting requirements. On August 2, 2016, the Company granted time-based and performance-based restricted stock awards under the Company's 2013 Incentive Award Plan to certain officers of the Company. The total number of restricted shares granted was 248,937 with a grant-date fair value of $5.29. The time-based restricted stock awards vest over 2.67 years. The performance-based restricted stock awards vest based on achievement of fiscal 2016 performance targets and are also subject to time-based vesting requirements over 3.67 years. On April 1, 2017, 61,552 performance-based restricted shares met the fiscal 2016 performance condition and are subject to subsequent time-based vesting requirements. Stock-based compensation cost related to restricted stock awards was $463 for fiscal year 2016. Unrecognized compensation expense related to outstanding restricted stock awards to employees as of April 1, 2017 is expected to be $1,009 (net of estimated forfeitures) to be recognized on a straight-line basis over a weighted average period of 1.9 years. The following table summarizes the Company's restricted stock awards activity during fiscal 2016: Restricted Stock Weighted Average Nonvested at February 27, 2016 — — Granted $ Vested ) Forfeited ) Withheld related to net settlement ) ​ ​ ​ ​ ​ ​ ​ ​ Nonvested at April 1, 2017 $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Shareholders' equity
Shareholders' equity | 12 Months Ended |
Apr. 01, 2017 | |
Shareholders' equity | |
Shareholders' equity | 8. Shareholders' equity Common stock During fiscal 2016, the Company issued 26,923 shares of common stock in exchange for consultation services received from a third-party at a weighted-average price of $5.01 per share. As of April 1, 2017, the Company had 250,000,000 shares of common stock authorized, with a par value of $0.01, of which 48,045,114 were issued. The holders of common stock are entitled to one vote per common share. The holders have no preemptive or other subscription rights and there are no redemptions or sinking fund provisions with respect to such shares. Common stock is subordinate to any preferred stock outstanding with respect to rights upon liquidation and dissolution of the Company. Preferred stock As of April 1, 2017, the Company had 5,000,000 shares of preferred stock authorized, with a par value of $0.01, of which no shares were issued or outstanding. |
Accumulated other comprehensive
Accumulated other comprehensive income | 12 Months Ended |
Apr. 01, 2017 | |
Accumulated other comprehensive income | |
Accumulated other comprehensive income | 9. Accumulated other comprehensive income Accumulated other comprehensive income ("AOCI") consists of changes in our foreign currency hedge contracts, pension liability adjustment, and foreign currency translation. The components of AOCI, net of tax, were as follows: Foreign Pension Foreign Total Balance at February 28, 2015 $ ) $ ) $ ) $ ) Other comprehensive (loss) income before reclassifications, net of tax ) ) ) Amounts reclassified to earnings, net of tax — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net current period other comprehensive income (loss) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at February 27, 2016 $ ) $ ) $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive (loss) income before reclassifications, net of tax — ) Amounts reclassified to earnings, net of tax — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net current period other comprehensive income (loss) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at April 2, 2016 $ ) $ ) $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive loss before reclassifications, net of tax ) ) ) ) Amounts reclassified to earnings, net of tax — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net current period other comprehensive loss ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at April 1, 2017 $ ) $ ) $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The unrecognized net actuarial loss included in accumulated other comprehensive income as of April 1, 2017 and February 27, 2016 was $1,444 and $992, respectively. Amounts reclassified from AOCI to earnings for the pension liability adjustment category are generally included in cost of sales and selling, general and administrative expenses in the Company's consolidated statements of operations. For a description of the Company's employee benefit plans, refer to Note 6. Amounts reclassified from AOCI to earnings for the foreign currency hedge instruments category are generally included in cost of sales in the Company's consolidated statements of operations. For a description of the Company's use of foreign currency forward contracts, refer to Note 10. |
Foreign currency forward contra
Foreign currency forward contracts | 12 Months Ended |
Apr. 01, 2017 | |
Foreign currency forward contracts | |
Foreign currency forward contracts | 10. Foreign currency forward contracts The Company's international operations and purchases of its significant product lines from foreign suppliers are subject to certain opportunities and risks, including foreign currency fluctuations. In the TCS segment, we utilize foreign currency forward contracts in Swedish krona to stabilize our retail gross margins and to protect our domestic operations from downward currency exposure by hedging purchases of inventory from our wholly owned subsidiary, Elfa. Forward contracts in the TCS segment are designated as cash flow hedges, as defined by ASC 815. In the Elfa segment, we utilize foreign currency forward contracts to hedge purchases, primarily of raw materials, that are transacted in currencies other than Swedish krona, which is the functional currency of Elfa. Forward contracts in the Elfa segment are economic hedges, and are not designated as cash flow hedges as defined by ASC 815. In fiscal 2016, fiscal 2015, and fiscal 2014, the TCS segment used forward contracts for 78%, 54%, and 54% of inventory purchases in Swedish krona each year, respectively. In fiscal 2016, fiscal 2015, and fiscal 2014, the Elfa segment used forward contracts to purchase U.S. dollars in the amount of $3,905, $5,495, and $4,300, which represented 56%, 67%, and 64% of the Elfa segment's U.S. dollar purchases each year, respectively. In the five-weeks ended April 2, 2016, the TCS segment used forward contracts for 0% of inventory purchases in Swedish krona and the Elfa segment used forward contracts to purchase U.S. dollars in the amount of $155, which represented 23% of the Elfa segment's U.S. dollar purchases. Generally, the Company's foreign currency forward contracts have terms from 1 to 12 months and require the Company to exchange currencies at agreed-upon rates at settlement. The counterparties to the contracts consist of a limited number of major domestic and international financial institutions. The Company does not hold or enter into financial instruments for trading or speculative purposes. The Company records its foreign currency forward contracts on a gross basis and generally does not require collateral from these counterparties because it does not expect any losses from credit exposure. The Company records all foreign currency forward contracts on its consolidated balance sheet at fair value. The Company accounts for its foreign currency hedge instruments in the TCS segment as cash flow hedges, as defined. Changes in the fair value of the foreign currency hedge instruments that are considered to be effective, as defined, are recorded in other comprehensive income (loss) until the hedged item (inventory) is sold to the customer, at which time the deferred gain or loss is recognized through cost of sales. Any portion of a change in the foreign currency hedge instrument's fair value that is considered to be ineffective, as defined, or that the Company has elected to exclude from its measurement of effectiveness, is immediately recorded in earnings as cost of sales. The Company assessed the effectiveness of the foreign currency hedge instruments and determined the foreign currency hedge instruments were highly effective during the fiscal years ended April 1, 2017, February 27, 2016, and February 28, 2015. Forward contracts not designated as hedges in the Elfa segment are adjusted to fair value as selling, general, and administrative expenses on the consolidated statements of operations. During fiscal 2016, the Company recognized a net unrealized gain of $120 associated with the change in fair value of forward contracts not designated as hedge instruments. The Company had $155 in accumulated other comprehensive loss related to foreign currency hedge instruments at April 1, 2017. Settled foreign currency hedge instruments related to inventory on hand as of April 1, 2017 represents $562 of the accumulated unrealized loss. The Company expects the unrealized loss of $562, net of taxes, to be reclassified into earnings over the next 12 months as the underlying inventory is sold to the end customer. The change in fair value of the Company's foreign currency hedge instruments that qualify as cash flow hedges and are included in accumulated other comprehensive income (loss), net of taxes, are presented in Note 9 of these financial statements. |
Leases
Leases | 12 Months Ended |
Apr. 01, 2017 | |
Leases | |
Leases | 11. Leases The Company conducts all of its U.S. operations from leased facilities that include a corporate headquarters/warehouse facility and 86 store locations. The corporate headquarters/warehouse and stores are under operating leases that will expire over the next 1 to 20 years. The Company also leases computer hardware under operating leases that expire over the next few years. In most cases, management expects that in the normal course of business, leases will be renewed or replaced by other leases. Most of the operating leases for the stores contain a renewal option at predetermined rental payments for periods of 5 to 20 years. This option enables the Company to retain use of facilities in desirable operating areas. The rental payments under certain store leases are based on a minimum rental plus a percentage of the sales in excess of a stipulated amount. These payments are accounted for as contingent rent and expensed when incurred. The following is a schedule of future minimum lease payments due under noncancelable operating and capital leases: Operating leases Capital leases Within 1 year $ $ 2 years 3 years 4 years — 5 years — Thereafter — ​ ​ ​ ​ ​ ​ ​ ​ Total minimum lease payments $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less amount representing interest ) ​ ​ ​ ​ ​ ​ ​ ​ Present value of minimum lease payments $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Rent expense for fiscal years 2016, 2015, 2014, and the five weeks ended April 2, 2016 was $80,647, $75,834, $72,643, and $6,495, respectively. Included in rent expense is percentage-of-sales rent expense of $416, $450, $633, and $32 for fiscal years 2016, 2015, 2014, and the five weeks ended April 2, 2016, respectively. |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Apr. 01, 2017 | |
Commitments and contingencies | |
Commitments and contingencies | 12. Commitments and contingencies In connection with insurance policies and other contracts, the Company has outstanding standby letters of credit totaling $4,143 as of April 1, 2017. The Company is subject to ordinary litigation and routine reviews by regulatory bodies that are incidental to its business, none of which is expected to have a material adverse effect on the Company's consolidated financial statements on an individual basis or in the aggregate. |
Fair value measurements
Fair value measurements | 12 Months Ended |
Apr. 01, 2017 | |
Fair value measurements | |
Fair value measurements | 13. Fair value measurements Under generally accepted accounting principles, the Company is required to a) measure certain assets and liabilities at fair value or b) disclose the fair values of certain assets and liabilities recorded at cost. Accounting standards define fair value as the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date. Fair value is calculated assuming the transaction occurs in the principal or most advantageous market for the asset or liability and includes consideration of non-performance risk and credit risk of both parties. Accounting standards pertaining to fair value establish a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value. These tiers include: • Level 1—Valuation inputs are based upon unadjusted quoted prices for identical instruments traded in active markets. • Level 2—Valuation inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3—Valuation inputs are unobservable and typically reflect management's estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are determined using model-based techniques that include option pricing models, discounted cash flow models and similar techniques. As of April 1, 2017 and February 27, 2016, the Company held certain items that are required to be measured at fair value on a recurring basis. These included the nonqualified retirement plan and foreign currency forward contracts. The nonqualified retirement plan consists of investments purchased by employee contributions to retirement savings accounts. The Company's international operations and purchases of its significant product lines from foreign suppliers are subject to certain opportunities and risks, including foreign currency fluctuations. The Company utilizes foreign currency forward exchange contracts to stabilize its retail gross margins and to protect its operations from downward currency exposure. Foreign currency hedge instruments are related to the Company's attempts to hedge foreign currency fluctuation on purchases of inventory in Swedish krona. The Company's foreign currency hedge instruments consist of over-the-counter (OTC) contracts, which are not traded on a public exchange. See Note 10 for further information on the Company's hedging activities. The fair value of the foreign currency forward contracts is determined based on the market approach which utilizes inputs that are readily available in public markets or can be derived from information available in publicly quoted markets for comparable assets. Therefore, the Company has categorized this item as Level 2. The Company also considers counterparty credit risk and its own credit risk in its determination of all estimated fair values. The Company has consistently applied these valuation techniques in all periods presented and believes it has obtained the most accurate information available for the types of contracts it holds. The following items are measured at fair value on a recurring basis, subject to the disclosure requirements of ASC 820, Fair Value Measurements, at April 1, 2017 and February 27, 2016: Description Balance Sheet Location April 1, February 27, Assets Nonqualified retirement plan(1) N/A Other current assets $ $ Foreign currency forward contracts Level 2 Other current assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total assets $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) The fair value amount of the nonqualified retirement plan is measured at fair value using the net asset value per share practical expedient, and therefore, is not classified in the fair value hierarchy. The fair value of long-term debt was estimated using quoted prices as well as recent transactions for similar types of borrowing arrangements (level 2 valuations). As of April 1, 2017 and February 27, 2016, the estimated fair value of the Company's long-term debt, including current maturities, was $295,005 and $221,534, respectively. |
Segment reporting
Segment reporting | 12 Months Ended |
Apr. 01, 2017 | |
Segment reporting | |
Segment reporting | 14. Segment reporting The Company's reportable segments were determined on the same basis as how management evaluates performance internally by the Chief Operating Decision Maker ("CODM"). The Company has determined that the Chief Executive Officer is the CODM and the Company's two reportable segments consist of TCS and Elfa. The TCS segment includes the Company's retail stores, website and call center, as well as the installation and organization services business. The Elfa segment includes the manufacturing business that produces the elfa® brand products that are sold domestically exclusively through the TCS segment, as well as on a wholesale basis in approximately 30 countries around the world with a concentration in the Nordic region of Europe. The intersegment sales in the Elfa column represent elfa® product sales to the TCS segment. These sales and the related gross margin on merchandise recorded in TCS inventory balances at the end of the period are eliminated for consolidation purposes in the Eliminations column. The net sales to third parties in the Elfa column represent sales to customers outside of the United States. On July 1, 2016, Melissa Reiff, former President and Chief Operating Officer, became the Company's Chief Executive Officer ("CEO"), succeeding William A. ("Kip") Tindell, III. Upon transition to CEO, Ms. Reiff assumed the role of CODM and during the second quarter of fiscal 2016, the Company re-evaluated its measure used to evaluate segment performance. Previously, the profit or loss measure used to make resource allocation decisions and evaluate segment performance was income or loss before taxes. The Company has determined that adjusted earnings before interest, tax, depreciation, and amortization ("Adjusted EBITDA") is the profit or loss measure that the CODM uses to make resource allocation decisions and evaluate segment performance. The shift to focus on Adjusted EBITDA more closely aligns with management's assessment of segment performance under Ms. Reiff's leadership. As such, all current and prior period segment information has been presented comparably. Adjusted EBITDA assists management in comparing our performance on a consistent basis for purposes of business decision-making by removing the impact of certain items that management believes do not directly reflect our core operations and, therefore, are not included in measuring segment performance. Adjusted EBITDA is calculated in accordance with the Senior Secured Term Loan Facility and the Revolving Credit Facility and we define Adjusted EBITDA as net income before interest, taxes, depreciation and amortization, certain non cash items, and other adjustments that we do not consider in our evaluation of ongoing operating performance from period to period. Fiscal year ended April 1, 2017 TCS Elfa Eliminations Total Net sales to third parties $ $ $ — $ Intersegment sales — ) — Adjusted EBITDA(2) Depreciation and amortization — Interest expense, net — Capital expenditures(1) — Goodwill — — Trade names(1) — Assets(1) ) Fiscal year ended February 27, 2016 TCS Elfa Eliminations Total Net sales to third parties $ $ $ — $ Intersegment sales — ) — Adjusted EBITDA Depreciation and amortization — Interest expense, net — Capital expenditures(1) — Goodwill — — Trade names(1) — Assets(1) ) Fiscal year ended February 28, 2015 TCS Elfa Eliminations Total Net sales to third parties $ $ $ — $ Intersegment sales — ) — Adjusted EBITDA Depreciation and amortization — Interest expense, net — Capital expenditures(1) — Five weeks ended April 2, 2016 TCS Elfa Eliminations Total Net sales to third parties $ $ $ — $ Intersegment sales — ) — Adjusted EBITDA ) Depreciation and amortization — Interest expense, net — Capital expenditures(1) — (1) Tangible assets and trade names in the Elfa column are located outside of the United States. (2) The TCS segment includes a net benefit of $3.9 million related to amended and restated employment agreements entered into with key executives during the first quarter, leading to a reversal of accrued deferred compensation associated with the original employment agreements. A reconciliation of Adjusted EBITDA by segment to income before taxes is set forth below: Fiscal Year Ended Five April 1, February 27, February 28, April 2, Adjusted EBITDA by segment: TCS $ $ $ $ Elfa ) Eliminations ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Adjusted EBITDA Depreciation and amortization ) ) ) ) Interest expense, net ) ) ) ) Pre-opening costs(a) ) ) ) ) Noncash rent(b) Stock-based compensation(c) ) ) ) ) Foreign exchange gains (losses)(d) ) ) Other adjustments(e) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income before taxes $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (a) Non-capital expenditures associated with opening new stores and relocating stores, including rent, marketing expenses, travel and relocation costs, and training costs. We adjust for these costs to facilitate comparisons of our performance from period to period. (b) Reflects the extent to which our annual GAAP rent expense has been above or below our cash rent payment due to lease accounting adjustments. The adjustment varies depending on the average age of our lease portfolio (weighted for size), as our GAAP rent expense on younger leases typically exceeds our cash cost, while our GAAP rent expense on older leases is typically less than our cash cost. (c) Non-cash charges related to stock-based compensation programs, which vary from period to period depending on volume and vesting timing of awards. We adjust for these charges to facilitate comparisons from period to period. (d) Realized foreign exchange transactional gains/losses our management does not consider in our evaluation of our ongoing operations. (e) Other adjustments include amounts our management does not consider in our evaluation of our ongoing operations, including certain severance and other charges. The following table shows sales by merchandise category as a percentage of total net sales for fiscal years 2016, 2015, and 2014: Fiscal year ended April 1, February 27, February 28, Custom Closets(1) % % % Storage, Box, Shelving % % % Kitchen and Trash % % % Office, Collections, & Hooks % % % Bath, Travel, Laundry % % % Containers, Gift Packaging, Seasonal, Impulse % % % Other % % % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total % % % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Includes elfa®, TCS Closets®, elfa® Sliding Doors products and installation as well as closet completion products sold by the TCS segment and Elfa segment sales to third parties. |
Net income per common share
Net income per common share | 12 Months Ended |
Apr. 01, 2017 | |
Net income per common share | |
Net income per common share | 15. Net income per common share Basic net income per common share is computed as net income divided by the weighted-average number of common shares outstanding for the period. Diluted net income per share is computed as net income divided by the weighted-average number of common shares outstanding for the period plus common stock equivalents consisting of shares subject to stock-based awards with exercise prices less than or equal to the average market price of the Company's common stock for the period, to the extent their inclusion would be dilutive. Potential dilutive securities are excluded from the computation of diluted net income per share if their effect is anti-dilutive. The following is a reconciliation of net income and the number of shares used in the basic and diluted net income per share calculations: Fiscal Year Ended April 2, February 27, February 28, Five Weeks Numerator: Net income $ $ $ $ Denominator: Weighted-average common shares—basic Options and other dilutive securities — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average common shares—diluted Net income per common share—basic and diluted $ $ $ $ Antidilutive securities not included: Stock options outstanding Nonvested restricted stock awards — — — |
Quarterly results of operations
Quarterly results of operations (unaudited) | 12 Months Ended |
Apr. 01, 2017 | |
Quarterly results of operations (unaudited) | |
Quarterly results of operations (unaudited) | 16. Quarterly results of operations (unaudited) Due to the seasonal nature of our business, fourth quarter operating results historically represent a larger share of annual net sales and operating income primarily due to Our Annual elfa® Sale. We follow the same accounting policies for preparing quarterly and annual financial data. The table below summarizes quarterly results for the fiscal year ended April 1, 2017 and the recast fiscal year ended April 2, 2016: Fiscal Year Ended April 1, 2017 Fourth Quarter Third Quarter Second Quarter First Quarter Net sales $ $ $ $ Gross profit Income from operations Net income (loss) ) Weighted-average shares used in computing basic net income (loss) per share Weighted-average shares used in computing diluted net income (loss) per share Basic and diluted net income (loss) per common share $ $ $ $ ) Recast Fiscal Year Ended April 2, 2016 Fourth Quarter Third Quarter Second Quarter First Quarter Net sales $ $ $ $ Gross profit Income (loss) from operations ) Net income (loss) ) Weighted-average shares used in computing basic net income (loss) per share Weighted-average shares used in computing diluted net income (loss) per share Basic and diluted net income (loss) per common share $ $ $ $ ) |
Transition Period Financial Inf
Transition Period Financial Information | 12 Months Ended |
Apr. 01, 2017 | |
Transition Period Financial Information | |
Transition Period Financial Information | 17. Transition Period Financial Information On March 30, 2016, the Board of Directors approved a change in the Company's fiscal year end from the Saturday closest to February 28 to the Saturday closest to March 31 of each year. Accordingly, the Company is presenting audited financial statements for the five week transition period from February 28, 2016 to April 2, 2016. The following table provides certain unaudited comparative financial information of the same period of the prior year. The periods below both represent 35 day periods. Five Weeks Ended (In thousands, except share and per share amounts) April 2, April 4, Consolidated statement of operations data: Net sales $ $ Gross profit Selling, general, and administrative expenses Income from operations Income before taxes Provision for income taxes Net income Net income per common share: Basic and diluted $ $ Weighted-average common shares—basic and diluted |
Subsequent Event
Subsequent Event | 12 Months Ended |
Apr. 01, 2017 | |
Subsequent Event | |
Subsequent Event | 18. Subsequent Event On May 23, 2017, the Company announced a four-part plan designed to optimize its consolidated business and drive improved sales and profitability (the "Optimization Plan"), which included the elimination of certain full-time positions at the Company's stores, corporate office and distribution center. The Company expects to incur approximately $2,000 in severance expense in the fiscal quarter ending July 1, 2017, in connection with the position eliminations. |
Schedule I-Condensed Financial
Schedule I-Condensed Financial Information of registrant | 12 Months Ended |
Apr. 01, 2017 | |
Schedule I-Condensed Financial Information of registrant | |
Schedule I-Condensed Financial Information of registrant | Schedule I—Condensed Financial Information of registrant— Condensed balance sheets (in thousands) April 1, 2017 February 27, 2016 Assets Current assets: Accounts receivable from subsidiaries $ $ ​ ​ ​ ​ ​ ​ ​ ​ Total current assets Noncurrent assets: Investment in subsidiaries ​ ​ ​ ​ ​ ​ ​ ​ Total noncurrent assets ​ ​ ​ ​ ​ ​ ​ ​ Total assets $ $ Liabilities and shareholders' equity Current liabilities: Accounts payable to subsidiaries $ — $ — ​ ​ ​ ​ ​ ​ ​ ​ Total current liabilities — — Noncurrent liabilities — — ​ ​ ​ ​ ​ ​ ​ ​ Total liabilities — — Shareholders' equity: Common stock Additional paid-in capital Retained deficit ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total shareholders' equity ​ ​ ​ ​ ​ ​ ​ ​ Total liabilities and shareholders' equity $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Schedule I—The Container Store Group, Inc. Condensed statements of operations Fiscal Year Ended Five Weeks (in thousands) April 1, February 27, February 28, April 2, Net sales — — — — Cost of sales (excluding depreciation and amortization) — — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross profit — — — — Selling, general, and administrative expenses (excluding depreciation and amortization) — — — — Stock-based compensation — — — — Pre-opening costs — — — — Depreciation and amortization — — — — Restructuring charges — — — — Other expenses — — — — Loss (gain) on disposal of assets — — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from operations — — — — Interest expense — — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income before taxes and equity in net income of subsidiaries — — — — Provision for income taxes — — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income before equity in net income of subsidiaries — — — — Net income of subsidiaries ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Schedule I—The Container Store Group, Inc. Condensed statements of comprehensive income Fiscal year ended Five Weeks (In thousands) April 1, February 27, February 28, Net income $ $ $ $ Unrealized (loss) gain on financial instruments, net of tax (benefit) provision of $(85), $606, $(604) and $7 ) ) Pension liability adjustment, net of tax provision (benefit) of $142, $39, $(4) and $0 ) ) ) Foreign currency translation adjustment ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Comprehensive income $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Schedule I—The Container Store Group, Inc. Notes to Condensed Financial Statements (In thousands, except share amounts and unless otherwise stated) April 1, 2017 Note 1: Basis of presentation In the parent-company-only financial statements, The Container Store Group, Inc.'s investment in subsidiaries is stated at cost plus equity in undistributed earnings of subsidiaries since the date of acquisition. The parent-company-only financial statements should be read in conjunction with the Company's consolidated financial statements. A condensed statement of cash flows was not presented because The Container Store Group, Inc. had no cash flow activities during fiscal 2016, fiscal 2015, fiscal 2014, or the five-weeks ended April 2, 2016. Note 2: Guarantees and restrictions The Container Store Inc., a subsidiary of the Company, has $316,760 of long-term debt outstanding under the Senior Secured Term Loan Facility, as of April 1, 2017. Under the terms of the Senior Secured Term Loan Facility, The Container Store Group, Inc. and the domestic subsidiaries of The Container Store, Inc. have guaranteed the payment of all principal and interest. In the event of a default under the Senior Secured Term Loan Facility, The Container Store Group, Inc. and the domestic subsidiaries of The Container Store, Inc. will be directly liable to the debt holders. The Senior Secured Term Loan Facility matures on April 6, 2019. The Senior Secured Term Loan Facility also includes restrictions on the ability of The Container Store Group, Inc. and its subsidiaries to incur additional liens and indebtedness, make investments and dispositions, pay dividends or make other distributions, make loans, prepay certain indebtedness and enter into sale and lease back transactions, among other restrictions. Under the Senior Secured Term Loan Facility, provided no event of default has occurred and is continuing, The Container Store, Inc. is permitted to pay dividends to The Container Store Group, Inc. in an amount not to exceed the sum of $10,000 plus if after giving effect to such dividend on a pro forma basis, the Consolidated Leverage Ratio (as defined in the Senior Secured Term Loan Facility) does not exceed 2.0 to 1.0, the Available Amount (as defined in the Senior Secured Term Loan Facility) during the term of the Senior Secured Term Loan Facility, and pursuant to certain other limited exceptions. The restricted net assets of the Company's consolidated subsidiaries was $209,290 as of April 1, 2017. As of April 1, 2017, The Container Store, Inc. also has $73,189 of available credit on the Revolving Credit Facility that provides commitments of up to $100,000 for revolving loans and letters of credit. The Container Store Group, Inc. and the domestic subsidiaries of The Container Store, Inc. have guaranteed all obligations under the Revolving Credit Facility. In the event of default under the Revolving Credit Facility, The Container Store Group, Inc. and the domestic subsidiaries of The Container Store, Inc. will be directly liable to the debt holders. The Revolving Credit Facility includes restrictions on the ability of The Container Store Group, Inc. and its subsidiaries to incur additional liens and indebtedness, make investments and dispositions, pay dividends or make other transactions, among other restrictions. On October 8, 2015, The Container Store, Inc. executed an amendment to the Revolving Credit Facility ("Amendment No. 2"). Under the terms of Amendment No. 2, among other items, the maturity date of the loan was extended from April 6, 2017 to the earlier of (x) October 8, 2020 and (y) January 6, 2019, if any of The Container Store, Inc.'s obligations under its term loan credit facility remain outstanding on such date and have not been refinanced with debt that has a final maturity date that is no earlier than April 6, 2019 or subordinated debt. Under the Revolving Credit Facility, provided no event of default has occurred and is continuing, The Container Store, Inc. is permitted to pay dividends to The Container Store Group, Inc., in an amount not to exceed the sum of $10,000 plus if after giving effect to such dividend on a pro forma basis, the Consolidated Fixed Charge Coverage Ratio (as defined in the Revolving Credit Facility) is not less than 1.25 to 1.0, the Available Amount (as defined in the Revolving Credit Facility) during the term of the Revolving Credit Facility, and pursuant to certain other limited exceptions. |
Nature of business and summar29
Nature of business and summary of significant accounting policies (Policies) | 12 Months Ended |
Apr. 01, 2017 | |
Nature of business and summary of significant accounting policies | |
Basis of presentation | Basis of presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP). |
Basis of consolidation | Basis of consolidation The consolidated financial statements include our accounts and those of the Company's wholly owned subsidiaries. The Company eliminates all significant intercompany balances and transactions, including intercompany profits, in consolidation. |
Fiscal year | Fiscal year The Company follows a 4-4-5 fiscal calendar, whereby each fiscal quarter consists of thirteen weeks grouped into two four-week "months" and one five-week "month", and its fiscal year ends on the Saturday closest to March 31 st . Elfa's fiscal year ends on the last day of the calendar month of March. Prior to fiscal year 2016, the Company's fiscal year ended on the Saturday closest to February 28 th . All references herein to "fiscal 2016" represent the results of the 52-week fiscal year ended April 1, 2017, and references to "fiscal 2015" represent the results of the 52-week fiscal year ended February 27, 2016. In addition, all references herein to "fiscal 2014" represent the 52-week fiscal year ended February 28, 2015. |
Management estimates | Management estimates The preparation of the Company's consolidated financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses. Actual results could differ from those estimates. Significant accounting judgments and estimates include fair value estimates for indefinite-lived intangible assets, inventory loss reserve, assessments of long-lived asset impairments, gift card breakage, and assessment of valuation allowances on deferred tax assets. |
Revenue recognition | Revenue recognition Revenue from sales related to retail operations is recognized when the merchandise is delivered to the customer at the point of sale. Revenue from sales that are shipped or delivered directly to customers is recognized upon estimated delivery to the customer and includes applicable shipping or delivery revenue. Revenue from sales that are installed is recognized upon completion of the installation service to the customer and includes applicable installation revenue. Revenue from sales of other services is recognized upon the completion of the service. Revenue from sales related to manufacturing operations is recorded upon shipment. Sales are recorded net of sales taxes collected from customers. A sales return allowance is recorded for estimated returns of merchandise subsequent to the balance sheet date that relate to sales prior to the balance sheet date. The returns allowance is based on historical return patterns and reduces sales and cost of sales, accordingly. Merchandise exchanges of similar product and price are not considered merchandise returns and, therefore, are excluded when calculating the sales returns allowance. |
Gift cards and merchandise credits | Gift cards and merchandise credits Gift cards are sold to customers in retail stores, through the call center and website, and through certain third parties. We issue merchandise credits in our stores and through our call center. Revenue from sales of gift cards and issuances of merchandise credits is recognized when the gift card is redeemed by the customer, or the likelihood of the gift card being redeemed by the customer is remote (gift card breakage). The gift card breakage rate is determined based upon historical redemption patterns. An estimate of the rate of gift card breakage is applied over the period of estimated performance (48 months as of the end of fiscal 2016) and the breakage amounts are included in net sales in the consolidated statement of operations. The Company recorded $1,072, $948, $978, and $73 of gift card breakage in fiscal years 2016, 2015, 2014, and the five weeks ended April 2, 2016, respectively. |
Cost of sales | Cost of sales Cost of sales related to retail operations includes the purchase cost of inventory sold (net of vendor rebates), in-bound freight, as well as inventory loss reserves. Costs incurred to ship or deliver merchandise to customers, as well as direct installation and organization services costs, are also included in cost of sales. Cost of sales from manufacturing operations includes costs associated with production, including materials, wages, other variable production costs, and other applicable manufacturing overhead. |
Leases | Leases Rent expense on operating leases, including rent holidays and scheduled rent increases, is recorded on a straight-line basis over the term of the lease, commencing on the date the Company takes possession of the leased property. Rent expense is recorded in selling, general, and administrative expenses. Pre-opening rent expense is recorded in pre-opening costs in the consolidated income statement. The net excess of rent expense over the actual cash paid has been recorded as deferred rent in the accompanying consolidated balance sheets. Tenant improvement allowances are also included in the accompanying consolidated balance sheets as deferred rent liabilities and are amortized as a reduction of rent expense over the term of the lease from the possession date. Contingent rental payments, typically based on a percentage of sales, are recognized in rent expense when payment of the contingent rent is probable. |
Advertising | Advertising All advertising costs of the Company are expensed when incurred, or upon the release of the initial advertisement, except for production costs related to catalogs and direct mailings to customers, which are initially capitalized. Production costs related to catalogs and direct mailings consist primarily of printing and postage and are expensed when mailed to the customer, except for direct mailings related to promotional campaigns, which are expensed over the period during which the promotional sales are expected to occur. Advertising costs are recorded in selling, general, and administrative expenses. Pre-opening advertising costs are recorded in pre-opening costs. Catalog and direct mailings costs capitalized at April 1, 2017 and February 27, 2016, amounted to $605 and $938 respectively, and are recorded in prepaid expenses on the accompanying consolidated balance sheets. Total advertising expense incurred for fiscal years 2016, 2015, 2014, and the five-weeks ended April 2, 2016 was $31,525, $32,343, $35,388, and $2,164, respectively. |
Pre-opening costs | Pre-opening costs Non-capital expenditures associated with opening new stores, including rent, marketing expenses, travel and relocation costs, and training costs, are expensed as incurred and are included in pre-opening costs in the consolidated statement of operations. |
Income taxes | Income taxes We account for income taxes utilizing Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 740, Income Taxes . ASC 740 requires an asset and liability approach, which requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities. We recognize interest and penalties related to unrecognized tax benefits in income tax expense. There were no uncertain tax positions requiring accrual as of April 1, 2017 and February 27, 2016. Valuation allowances are established against deferred tax assets when it is more-likely-than-not that the realization of those deferred tax assets will not occur. Valuation allowances are released as positive evidence of future taxable income sufficient to realize the underlying deferred tax assets becomes available. Deferred tax assets and liabilities are measured using the enacted tax rates in effect in the years when those temporary differences are expected to reverse. The effect on deferred taxes from a change in the tax rate is recognized through continuing operations in the period that includes the enactment of the change. Changes in tax laws and rates could affect recorded deferred tax assets and liabilities in the future. We operate in certain jurisdictions outside the United States. ASC 740-30 provides that the undistributed earnings of a foreign subsidiary be accounted for as a temporary difference under the presumption that all undistributed earnings will be distributed to the parent company as a dividend. Sufficient evidence of the intent to permanently reinvest the earnings in the jurisdiction where earned precludes a company from recording the temporary difference. For purposes of ASC 740-30, we are partially reinvested in our Swedish subsidiary Elfa and thus do not record a temporary difference. We are partially reinvested since we have permanently reinvested our past earnings at Elfa; however, we do not assert that all future earnings will be reinvested into Elfa. |
Stock-based compensation | Stock-based compensation The Company accounts for stock-based compensation in accordance ASC 718, Compensation-Stock Compensation , which requires the fair value of stock-based payments to be recognized in the consolidated financial statements as compensation expense over the requisite service period. For time-based awards, compensation expense is recognized on a straight line basis, net of forfeitures, over the requisite service period for awards that actually vest. For performance-based awards, compensation expense is estimated based on achievement of the performance condition and is recognized using the accelerated attribution method over the requisite service period for awards that actually vest. Stock-based compensation expense is recorded in the stock-based compensation line in the consolidated statements of operations. Stock Options The Board determines the exercise price of stock options based on the closing price of the Company's common stock as reported on The New York Stock Exchange on the grant date. The Company estimates the fair value of each stock option grant on the date of grant based upon the Black-Scholes option-pricing model. This model requires various significant judgmental assumptions in order to derive a final fair value determination for each type of award including: • Expected Term—The expected term of the options represents the period of time between the grant date of the options and the date the options are either exercised or canceled, including an estimate of options still outstanding. • Expected Volatility—The expected volatility incorporates historical and implied volatility of comparable public companies for a period approximating the expected term. • Expected Dividend Yield—The expected dividend yield is based on the Company's expectation of not paying dividends on its common stock for the foreseeable future. • Risk-Free Interest Rate—The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant and with a maturity that approximates the expected term. Restricted Stock Awards The fair value of each restricted stock award is determined based on the closing price of the Company's common stock as reported on The New York Stock Exchange on the grant date. |
Accounts receivable | Accounts receivable Accounts receivable consist primarily of trade receivables, receivables from The Container Store, Inc.'s credit card processors for sales transactions, and tenant improvement allowances from The Container Store, Inc.'s landlords in connection with new leases. An allowance for doubtful accounts is established on trade receivables, if necessary, for estimated losses resulting from the inability of customers to make required payments. Factors such as payment terms, historical loss experience, and economic conditions are generally considered in determining the allowance for doubtful accounts. Accounts receivable are presented net of allowances for doubtful accounts of $305 and $128 at April 1, 2017 and February 27, 2016, respectively. |
Inventories | Inventories Inventories at retail stores are comprised of finished goods and are valued at the lower of cost or estimated net realizable value, with cost determined on a weighted-average cost method including associated freight costs. Manufacturing inventories are comprised of raw materials, work in process, and finished goods and are valued on a first-in, first out basis using full absorption accounting which includes material, labor, other variable costs, and other applicable manufacturing overhead. To determine if the value of inventory is recoverable at cost, we consider current and anticipated demand, customer preference and the merchandise age. The significant estimates used in inventory valuation are obsolescence (including excess and slow-moving inventory) and estimates of inventory shrinkage. We adjust our inventory for obsolescence based on historical trends, aging reports, specific identification and our estimates of future retail sales prices. Reserves for shrinkage are estimated and recorded throughout the period as a percentage of cost of sales based on historical shrinkage results and current inventory levels. Actual shrinkage is recorded throughout the year based upon periodic cycle counts. Actual inventory shrinkage can vary from estimates due to factors including the mix of our inventory and execution against loss prevention initiatives in our stores and distribution center. |
Property and equipment | Property and equipment Property and equipment are recorded at cost less accumulated depreciation. Significant additions and improvements are capitalized, and expenditures for maintenance and repairs are expensed. Gains and losses on the disposition of property and equipment are recognized in the period incurred. Depreciation, including amortization of assets recorded under capital lease obligations, is provided using the straight-line method over the estimated useful lives of depreciable assets as follows: Buildings 30 years Furniture, fixtures, and equipment 3 to 10 years Computer software 2 to 5 years Leasehold improvements Shorter of useful life or lease term Capital leases Shorter of useful life or lease term Costs of developing or obtaining software for internal use or developing the Company's website, such as external direct costs of materials or services and internal payroll costs directly related to the software development projects are capitalized. For the fiscal years ended April 1, 2017, February 27, 2016, and February 28, 2015, the Company capitalized $4,392, $3,272, and $5,017, respectively, and amortized $3,498, $3,258, and $2,992, respectively, of costs in connection with the development of internally used software. For the five-week period ended April 2, 2016, the Company capitalized $299 and amortized $296 of costs in connection with the development of internally used software. |
Long-lived assets | Long-lived assets Long-lived assets, such as property and equipment and intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Conditions that may indicate impairment include, but are not limited to, a significant adverse change in customer demand or business climate that could affect the value of an asset, a product recall or an adverse action or assessment by a regulator. If the sum of the estimated undiscounted future cash flows related to the asset is less than the carrying value, we recognize a loss equal to the difference between the carrying value and the fair value, usually determined by the estimated discounted cash flow analysis of the asset. For our TCS segment, we generally evaluate long-lived tangible assets at a store level, or at the lowest level at which independent cash flows can be identified. We evaluate corporate assets or other long-lived assets that are not store-specific at the consolidated level. For our Elfa segment, we evaluate long-lived tangible assets at the segment level. Since there is typically no active market for our long-lived tangible assets, we estimate fair values based on the expected future cash flows. We estimate future cash flows based on store-level historical results, current trends, and operating and cash flow projections. Our estimates are subject to uncertainty and may be affected by a number of factors outside our control, including general economic conditions and the competitive environment. While we believe our estimates and judgments about future cash flows are reasonable, future impairment charges may be required if the expected cash flow estimates, as projected, do not occur or if events change requiring us to revise our estimates. |
Foreign currency forward contracts | Foreign currency forward contracts We account for foreign currency forward contracts in accordance with ASC 815, Derivatives and Hedging . In the TCS segment, we may utilize foreign currency forward contracts in Swedish krona to stabilize our retail gross margins and to protect our domestic operations from downward currency exposure by hedging purchases of inventory from our wholly owned subsidiary, Elfa. In the Elfa segment, we may utilize foreign currency forward contracts to hedge purchases of raw materials that are transacted in currencies other than Swedish krona, which is the functional currency of Elfa. Generally, the Company's foreign currency forward contracts have terms from 1 to 12 months and require the Company to exchange currencies at agreed-upon rates at settlement. The Company does not hold or enter into financial instruments for trading or speculative purposes. The Company records all foreign currency forward contracts on its consolidated balance sheet at fair value. The Company records its foreign currency forward contracts on a gross basis. Forward contracts not designated as hedges are adjusted to fair value through income as selling, general and administrative expenses. The Company accounts for its foreign currency hedge instruments as cash flow hedges, as defined. Changes in the fair value of the foreign currency hedge instruments that are considered to be effective, as defined, are recorded in other comprehensive income (loss) until the hedged item (inventory) is sold to the customer, at which time the deferred gain or loss is recognized through cost of sales. Any portion of a change in the foreign currency hedge instrument's fair value that is considered to be ineffective, as defined, or that the Company has elected to exclude from its measurement of effectiveness, is immediately recorded in earnings as cost of sales. |
Self-insured liabilities | Self-insured liabilities We are primarily self-insured for workers' compensation, employee health benefits and general liability claims. We record self-insurance liabilities based on claims filed, including the development of those claims, and an estimate of claims incurred but not yet reported. Factors affecting these estimates include future inflation rates, changes in severity, benefit level changes, medical costs and claim settlement patterns. Should a different amount of claims occur compared to what was estimated, or costs of the claims increase or decrease beyond what was anticipated, reserves may need to be adjusted accordingly. We determine our workers' compensation liability and general liability claims reserves based on an analysis of historical claims data. Self-insurance reserves for employee health benefits, workers' compensation and general liability claims are recorded in the accrued liabilities line item of the consolidated balance sheet and were $3,016 and $3,471 as of April 1, 2017 and February 27, 2016, respectively. |
Goodwill | Goodwill We evaluate goodwill annually to determine whether it is impaired. Goodwill is also tested between annual impairment tests if an event occurs or circumstances change that would indicate that the fair value of a reporting unit is less than its carrying amount. Conditions that may indicate impairment include, but are not limited to, a significant adverse change in customer demand or business climate that could affect the value of an asset. If an impairment indicator exists, we test goodwill for recoverability. We have identified two reporting units and we have selected the first day of the fourth fiscal quarter to perform our annual goodwill impairment testing. Prior to testing goodwill for impairment, we perform a qualitative assessment to determine whether it is more likely than not that goodwill is impaired for each reporting unit. If the results of the qualitative assessment indicate that the likelihood of impairment is greater than 50%, then we perform a two-step impairment test on goodwill. In the first step, we compare the fair value of the reporting unit to its carrying value. If the fair value of the reporting unit exceeds the carrying value of the net assets assigned to that unit, goodwill is considered not impaired and we are not required to perform further testing. If the carrying value of the net assets assigned to the reporting unit exceeds the fair value of the reporting unit, then we must perform the second step of the impairment test in order to determine the implied fair value of the reporting unit's goodwill. If the carrying value of a reporting unit's goodwill exceeds its implied fair value, then we would record an impairment loss equal to the difference. The fair value of each reporting unit is determined by using a discounted cash flow analysis using the income approach. We also use a market approach to compare the estimated fair value to comparable companies. The determination of fair value requires assumptions and estimates of many critical factors, including among others, our nature and our history, financial and economic conditions affecting us, our industry and the general economy, past results, our current operations and future prospects, sales of similar businesses or capital stock of publicly held similar businesses, as well as prices, terms and conditions affecting past sales of similar businesses. Forecasts of future operations are based, in part, on operating results and management's expectations as to future market conditions. These types of analyses contain uncertainties because they require management to make assumptions and to apply judgments to estimate industry economic factors and the profitability of future business strategies. If actual results are not consistent with our estimates and assumptions, we may be exposed to future impairment losses that could be material. |
Trade names | Trade names We annually evaluate whether the trade names continue to have an indefinite life. Trade names are reviewed for impairment annually on the first day of the fourth fiscal quarter and may be reviewed more frequently if indicators of impairment are present. Conditions that may indicate impairment include, but are not limited to, a significant adverse change in customer demand or business climate that could affect the value of an asset, a product recall or an adverse action or assessment by a regulator. The impairment review is performed by comparing the carrying value to the estimated fair value, determined using a discounted cash flow methodology. If the recorded carrying value of the trade name exceeds its estimated fair value, an impairment charge is recorded to write the trade name down to its estimated fair value. Factors used in the valuation of intangible assets with indefinite lives include, but are not limited to, future revenue growth assumptions, estimated market royalty rates that could be derived from the licensing of our trade names to third parties, and a rate used to discount the estimated royalty cash flow projections. The valuation of trade names requires assumptions and estimates of many critical factors, which are consistent with the factors discussed under "Goodwill" above. Forecasts of future operations are based, in part, on operating results and management's expectations as to future market conditions. These types of analyses contain uncertainties because they require management to make assumptions and to apply judgments to estimate industry economic factors and the profitability of future business strategies. If actual results are not consistent with our estimates and assumptions, we may be exposed to future impairment losses that could be material. |
Foreign currency translation | Foreign currency translation The Company operates foreign subsidiaries in the following countries: Sweden, Norway, Finland, Denmark, Germany, Poland, and France. The functional currency of the Company's foreign operations is the applicable country's currency. All assets and liabilities of foreign subsidiaries and affiliates are translated at year-end rates of exchange. Revenues and expenses of foreign subsidiaries and affiliates are translated at average rates of exchange for the year. Unrealized gains and losses on translation are reported as cumulative translation adjustments through other comprehensive income (loss). The functional currency for the Company's wholly owned subsidiary, Elfa, is the Swedish krona. During fiscal 2016, the rate of exchange from U.S. dollar to Swedish krona increased from 8.6 to 8.9. The carrying amount of assets related to Elfa and subject to currency fluctuation was $108,707 and $109,548 as of April 1, 2017 and February 27, 2016, respectively. Foreign currency realized gains of $342, realized losses of $241, realized gains of $171, and realized gains of $60 are included in selling, general, and administrative expenses in the consolidated statements of operations in fiscal 2016, fiscal 2015, fiscal 2014, and the five-weeks ended April 2, 2016, respectively. |
Recent accounting pronouncements | Recent accounting pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) , to revise lease accounting guidance. The update requires most leases to be recorded on the balance sheet as a lease liability, with a corresponding right-of-use asset, whereas these leases currently have an off-balance sheet classification. ASU 2016-02 must be applied on a modified retrospective basis and is effective for fiscal years beginning after December 15, 2018, and interim periods within those years, with early adoption permitted. The Company currently intends to adopt this standard in the first quarter of fiscal 2019. The Company is still evaluating the impact of implementation of this standard on its financial statements, but expects that adoption will have a material impact to the Company's total assets and liabilities given the Company has a significant number of operating leases not currently recognized on its balance sheet. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers , an updated standard on revenue recognition. ASU 2014-09 provides enhancements to the quality and consistency of how revenue is reported while also improving comparability in the financial statements of companies reporting using IFRS and GAAP. The core principle of the new standard is for companies to recognize revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration (that is, payment) to which the Company expects to be entitled in exchange for those goods or services. The new standard also will result in enhanced disclosures about revenue, provide guidance for transactions that were not previously addressed comprehensively (for example, service revenue and contract modifications) and improve guidance for multiple-element arrangements. In July 2015, the FASB deferred the effective date of ASU 2014-09. Accordingly, this standard is effective for reporting periods beginning after December 15, 2017, including interim periods within that fiscal year, with early adoption permitted for interim and annual periods beginning after December 15, 2016. The Company currently intends to adopt this standard in the first quarter of fiscal 2018. This guidance can be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption, but the Company has not yet selected a transition method. The Company has identified certain impacts to our accounting for gift cards given away for promotional or marketing purposes. Under current GAAP, the value of promotional gift cards are recorded as selling, general, and administrative expense. The new standard requires these types of gift cards to be accounted for as a reduction of revenue (i.e. a discount). The Company does not expect the adoption of ASU 2014-09 to have a material impact on the financial statements. In March 2016, the FASB issued ASU 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting , which outlines new provisions intended to simplify various aspects related to accounting for share-based payments, including income tax consequences, forfeitures, and classification in the statement of cash flows. This ASU is effective for fiscal years beginning after December 15, 2016, and interim periods within those years, with early adoption permitted. The Company does not expect this standard to have a material impact on its financial statements and currently intends to adopt this standard in the first quarter of fiscal 2017. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory , which requires entities to recognize the income tax effects of intercompany sales and transfers of assets, other than inventory, in the period in which the transfer occurs. This is a change from current GAAP, which requires entities to defer the income tax effects of intercompany transfers of assets until the asset has been sold to an outside party or otherwise recognized (i.e. depreciated, amortized, impaired). The income tax effects of intercompany sales and transfers of inventory will continue to be deferred until the inventory is sold to an outside party. This ASU is effective for fiscal years beginning after December 15, 2017, and interim periods within those years, with early adoption permitted. The Company does not expect this standard to have a material impact on its financial statements. In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment , which provides guidance to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test under ASC Topic 350. Under the new guidance, an entity should perform goodwill impairment testing by comparing the fair value of a reporting unit with its carrying amount. If the a reporting unit's carrying amount exceeds its fair value, an entity should recognize an impairment charge based on that difference, limited to the total amount of goodwill allocated to that reporting unit. This ASU will be applied prospectively and is effective for annual and interim impairment tests performed in periods beginning after December 15, 2019. Early adoption is permitted for annual and interim goodwill impairment testing dates after January 1, 2017. The Company does not expect this standard to have a material impact on its financial statements. In March 2017, the FASB issued ASU 2017-07, Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost , which provides guidance that requires an employer to present the service cost component separate from the other components of net periodic benefit cost. The update requires that employers present the service cost component of the net periodic benefit cost in the same income statement line item as other employee compensation costs arising from services rendered by participating employees during the period. The other components of the net periodic benefit cost are required to be presented separately from the line item that includes service cost and outside of the subtotal of income from operations. If a separate line item is not used, the line item used in the income statement must be disclosed. In addition, only the service cost component is eligible for capitalization in assets. This ASU will be applied retrospectively and is effective for fiscal years beginning after December 15, 2017, and interim periods within those years, with early adoption permitted. The Company does not expect this standard to have a material impact on its financial statements. In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory , which changes the measurement principle for inventory from the lower of cost or market to the lower of cost and net realizable value. ASU 2015-11 defines net realizable value as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. ASU 2015-11 was effective for and adopted by the Company in the first quarter of fiscal 2016 on a prospective basis. The adoption of this standard did not result in a material impact to the Company's financial statements. In May 2015, the FASB issued ASU 2015-07, Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or its Equivalent) , which is intended to eliminate the diversity in practice surrounding how investments measured at net asset value ("NAV") with redemption dates in the future are categorized in the fair value hierarchy. Under the new guidance, investments measured at fair value using the NAV per share practical expedient should no longer be categorized in the fair value hierarchy. ASU 2015-07 was effective for and adopted by the Company in the first quarter of fiscal 2016 on a retrospective basis. As a result, the nonqualified retirement plan, which is measured at NAV per share using the practical expedient, is no longer categorized in the fair value hierarchy. In April 2015, the FASB issued ASU 2015-05, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350 - 40) : Customer's Accounting for Fees Paid in a Cloud Computing Arrangement . The amendments in ASU 2015-05 provide guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, the customer should account for the software license element of the arrangement consistent with other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. ASU 2015-05 was effective for and adopted by the Company in the first quarter of fiscal 2016 on a prospective basis. The adoption of this standard did not result in a material impact to the Company's financial statements. In April 2015, the FASB issued ASU 2015-03 , Interest—Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs . The update requires debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability rather than being presented as an asset. The update requires retrospective application and represents a change in accounting principle. In addition, in August 2015, ASU 2015-15, Interest—Imputation of Interest , was released which added SEC paragraphs pursuant to the SEC Staff Announcement at the June 18, 2015 Emerging Issues Task Force (EITF) meeting about the presentation and subsequent measurement of debt issuance costs associated with line-of-credit arrangements. Given the absence of authoritative guidance within ASU 2015-03 for debt issuance costs related to line-of-credit arrangements, ASU 2015-15 states the SEC staff would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The amendments in ASU 2015-03 and ASU 2015-15 were effective for and adopted by the Company in the first quarter of fiscal 2016 on a retrospective basis. The impact of ASU 2015-03 and ASU 2015-15 on our consolidated financial statements included a reclassification of net deferred financing costs related to our Senior Secured Term Loan Facility to be presented in the balance sheet as a reduction of long-term debt, net of deferred financing costs, while net deferred financing costs related to our Revolving Credit Facility remain an asset in the deferred financing costs line item. The Company had $3,667 and $5,649 of net deferred financing costs as of April 1, 2017 and February 27, 2016, respectively, related to our Senior Secured Term Loan Facility. |
Nature of business and summar30
Nature of business and summary of significant accounting policies (Tables) | 12 Months Ended |
Apr. 01, 2017 | |
Nature of business and summary of significant accounting policies | |
Schedule of estimated useful lives of depreciable assets | Buildings 30 years Furniture, fixtures, and equipment 3 to 10 years Computer software 2 to 5 years Leasehold improvements Shorter of useful life or lease term Capital leases Shorter of useful life or lease term |
Goodwill and trade names (Table
Goodwill and trade names (Tables) | 12 Months Ended |
Apr. 01, 2017 | |
Goodwill and trade names | |
Schedule of changes in the carrying amount of goodwill and trade names | Goodwill Trade names Balance at February 28, 2015 Gross balance Accumulated impairment charges ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total, net $ $ Foreign currency translation adjustments — ) Balance at February 27, 2016 Gross balance Accumulated impairment charges ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total, net $ $ Foreign currency translation adjustments — Balance at April 2, 2016 Gross balance Accumulated impairment charges ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total, net $ $ Foreign currency translation adjustments — ) Balance at April 1, 2017 Gross balance Accumulated impairment charges ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total, net $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Detail of certain balance she32
Detail of certain balance sheet accounts (Tables) | 12 Months Ended |
Apr. 01, 2017 | |
Detail of certain balance sheet accounts | |
Schedule of detail of certain balance sheet accounts | April 1, February 27, Accounts receivable, net: Trade receivables, net $ $ Credit card receivables Tenant allowances Other receivables ​ ​ ​ ​ ​ ​ ​ ​ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Inventory: Finished goods $ $ Raw materials Work in progress ​ ​ ​ ​ ​ ​ ​ ​ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Property and equipment, net: Land and buildings $ $ Furniture and fixtures Machinery and equipment Computer software and equipment Leasehold improvements Construction in progress Leased vehicles and other ​ ​ ​ ​ ​ ​ ​ ​ Less accumulated depreciation and amortization ) ) ​ ​ ​ ​ ​ ​ ​ ​ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accrued Liabilities: Accrued payroll, benefits and bonuses $ $ Unearned revenue Accrued transaction and property tax Gift cards and store credits outstanding Accrued lease liabilities Accrued interest Other accrued liabilities ​ ​ ​ ​ ​ ​ ​ ​ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Long-term debt and revolving 33
Long-term debt and revolving lines of credit (Tables) | 12 Months Ended |
Apr. 01, 2017 | |
Long-term debt and revolving lines of credit | |
Schedule of long-term debt and revolving lines of credit | April 1, February 27, Senior secured term loan facility $ $ 2014 Elfa term loan facility 2014 Elfa revolving credit facility — Obligations under capital leases Other loans Revolving credit facility — — ​ ​ ​ ​ ​ ​ ​ ​ Total debt Less current portion ) ) Less deferred financing costs(1) ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total long-term debt $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Represents deferred financing costs related to our Senior Secured Term Loan Facility, which are presented net of long-term debt in the consolidated balance sheet. |
Schedule of total revolving lines of credit and debt maturities | Scheduled total revolving lines of credit and debt maturities for the fiscal years subsequent to April 1, 2017, are as follows: Within 1 year $ 2 years 3 years 4 years — 5 years — Thereafter — ​ ​ ​ ​ ​ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of amortization expense of deferred financing costs | Senior Secured Revolving Total Within 1 year $ $ $ 2 years 3 years — 4 years — 5 years — — — Thereafter — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Apr. 01, 2017 | |
Income taxes | |
Schedule of components of the provision for income taxes (Pre-tax income) | Fiscal Year Five Weeks April 1, February 27, February 28, Income before income taxes: U.S. $ $ $ $ Foreign ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current Federal $ $ ) $ $ State Foreign ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total current provision ) Deferred Federal State ) Foreign ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total deferred provision (benefit) ) Total provision for income taxes $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of components of the provision for income taxes (Provision for income taxes) | Fiscal Year Five Weeks April 1, February 27, February 28, Income before income taxes: U.S. $ $ $ $ Foreign ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Current Federal $ $ ) $ $ State Foreign ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total current provision ) Deferred Federal State ) Foreign ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total deferred provision (benefit) ) Total provision for income taxes $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of differences between the actual provision for income taxes and the amounts computed by applying the statutory federal tax rate to income before taxes | Fiscal Year Ended Five Weeks April 1, February 27, February 28, Provision computed at federal statutory rate $ $ $ $ Permanent differences Change in valuation allowance ) State income taxes, net of federal benefit Effect of foreign income taxes ) ) ) Prior period error — — ) — Non-taxable gain on sale of Norwegian subsidiary — — ) — Economic zone credits — ) ) — Other, net ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of components of deferred tax assets and liabilities | April 1, February 27, Deferred tax assets: Inventory $ $ Loss and credit carryforwards Stock compensation Accrued liabilities Capital assets ​ ​ ​ ​ ​ ​ ​ ​ Valuation allowance ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total deferred tax assets Deferred tax liabilities: Intangibles ) ) Capital assets ) ) Other ) ) ​ ​ ​ ​ ​ ​ ​ ​ Total deferred tax liabilities ) ) Net deferred tax liabilities $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Employee benefit plans (Tables)
Employee benefit plans (Tables) | 12 Months Ended |
Apr. 01, 2017 | |
Employee benefit plans | |
Schedule of reconciliation of the changes in the defined benefit obligations, a statement of funded status, and the related weighted-average assumptions | April 1, February 27, Change in benefit obligation: Projected benefit obligation, beginning of year $ $ Service cost Interest cost Benefits paid ) ) Actuarial loss (gain) ) Exchange rate gain ) ) ​ ​ ​ ​ ​ ​ ​ ​ Projected benefit obligation, end of year Fair value of plan assets, end of year — — ​ ​ ​ ​ ​ ​ ​ ​ Underfunded status, end of year $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ Discount rate % % Rate of pay increases % % ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of components of net periodic benefit cost | Fiscal Year Ended Five Weeks April 1, February 27, February 28, Components of net periodic benefit cost: Defined benefit plans: Service cost $ $ $ $ Interest cost Amortization of unrecognized net loss — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net periodic benefit cost for defined benefit plan Defined contribution plans ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total net periodic benefit cost $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Stock-based compensation (Table
Stock-based compensation (Tables) | 12 Months Ended |
Apr. 01, 2017 | |
Stock-based compensation | |
Summary of the Company's stock option activity | Fiscal Year 2016(1) 2015 2014 Shares Weighted- Weighted- Aggregate Shares Weighted- Weighted- Aggregate Shares Weighted- Weighted- Aggregate Beginning balance $ $ $ Granted $ $ $ Exercised — $ — ) $ ) $ Forfeited ) $ ) $ ) $ Expired ) $ ) $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ending balance $ $ — $ $ — $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Vested and exercisable at end of year $ $ — $ $ — $ $ (1) Fiscal 2016 includes 6,690 options forfeited and 576 options expired during the five-weeks ended April 2, 2016. There were no options granted or exercised during the five-weeks ended April 2, 2016. |
Summary of the weighted-average grant date fair value of using the Black Scholes option pricing model | Fiscal Year 2016 2015 2014 Expected term 6.0 years 6.0 years 6.1 years Expected volatility 67.9% 50.3% 50.4% Risk-free interest rate 1.2% 1.7% 1.8% Dividend yield 0% 0% 0% |
Summary of Company's restricted stock awards activity | Restricted Stock Weighted Average Nonvested at February 27, 2016 — — Granted $ Vested ) Forfeited ) Withheld related to net settlement ) ​ ​ ​ ​ ​ ​ ​ ​ Nonvested at April 1, 2017 $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Accumulated other comprehensi37
Accumulated other comprehensive income (Tables) | 12 Months Ended |
Apr. 01, 2017 | |
Accumulated other comprehensive income | |
Schedule of components of AOCI, net of tax | Foreign Pension Foreign Total Balance at February 28, 2015 $ ) $ ) $ ) $ ) Other comprehensive (loss) income before reclassifications, net of tax ) ) ) Amounts reclassified to earnings, net of tax — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net current period other comprehensive income (loss) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at February 27, 2016 $ ) $ ) $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive (loss) income before reclassifications, net of tax — ) Amounts reclassified to earnings, net of tax — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net current period other comprehensive income (loss) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at April 2, 2016 $ ) $ ) $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive loss before reclassifications, net of tax ) ) ) ) Amounts reclassified to earnings, net of tax — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net current period other comprehensive loss ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at April 1, 2017 $ ) $ ) $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Apr. 01, 2017 | |
Leases | |
Schedule of future minimum lease payments for noncancelable operating and capital leases | Operating leases Capital leases Within 1 year $ $ 2 years 3 years 4 years — 5 years — Thereafter — ​ ​ ​ ​ ​ ​ ​ ​ Total minimum lease payments $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less amount representing interest ) ​ ​ ​ ​ ​ ​ ​ ​ Present value of minimum lease payments $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Fair value measurements (Tables
Fair value measurements (Tables) | 12 Months Ended |
Apr. 01, 2017 | |
Fair value measurements | |
Schedule of items measured at fair value on a recurring basis, subject to the disclosure requirements of ASC 820 | Description Balance Sheet Location April 1, February 27, Assets Nonqualified retirement plan(1) N/A Other current assets $ $ Foreign currency forward contracts Level 2 Other current assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total assets $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) The fair value amount of the nonqualified retirement plan is measured at fair value using the net asset value per share practical expedient, and therefore, is not classified in the fair value hierarchy. |
Segment reporting (Tables)
Segment reporting (Tables) | 12 Months Ended |
Apr. 01, 2017 | |
Segment reporting | |
Schedule of segment reporting | Fiscal year ended April 1, 2017 TCS Elfa Eliminations Total Net sales to third parties $ $ $ — $ Intersegment sales — ) — Adjusted EBITDA(2) Depreciation and amortization — Interest expense, net — Capital expenditures(1) — Goodwill — — Trade names(1) — Assets(1) ) Fiscal year ended February 27, 2016 TCS Elfa Eliminations Total Net sales to third parties $ $ $ — $ Intersegment sales — ) — Adjusted EBITDA Depreciation and amortization — Interest expense, net — Capital expenditures(1) — Goodwill — — Trade names(1) — Assets(1) ) Fiscal year ended February 28, 2015 TCS Elfa Eliminations Total Net sales to third parties $ $ $ — $ Intersegment sales — ) — Adjusted EBITDA Depreciation and amortization — Interest expense, net — Capital expenditures(1) — Five weeks ended April 2, 2016 TCS Elfa Eliminations Total Net sales to third parties $ $ $ — $ Intersegment sales — ) — Adjusted EBITDA ) Depreciation and amortization — Interest expense, net — Capital expenditures(1) — (1) Tangible assets and trade names in the Elfa column are located outside of the United States. (2) The TCS segment includes a net benefit of $3.9 million related to amended and restated employment agreements entered into with key executives during the first quarter, leading to a reversal of accrued deferred compensation associated with the original employment agreements. |
Summary of reconciliation of adjusted EBITDA by segment to income before taxes | Fiscal Year Ended Five April 1, February 27, February 28, April 2, Adjusted EBITDA by segment: TCS $ $ $ $ Elfa ) Eliminations ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Adjusted EBITDA Depreciation and amortization ) ) ) ) Interest expense, net ) ) ) ) Pre-opening costs(a) ) ) ) ) Noncash rent(b) Stock-based compensation(c) ) ) ) ) Foreign exchange gains (losses)(d) ) ) Other adjustments(e) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income before taxes $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (a) Non-capital expenditures associated with opening new stores and relocating stores, including rent, marketing expenses, travel and relocation costs, and training costs. We adjust for these costs to facilitate comparisons of our performance from period to period. (b) Reflects the extent to which our annual GAAP rent expense has been above or below our cash rent payment due to lease accounting adjustments. The adjustment varies depending on the average age of our lease portfolio (weighted for size), as our GAAP rent expense on younger leases typically exceeds our cash cost, while our GAAP rent expense on older leases is typically less than our cash cost. (c) Non-cash charges related to stock-based compensation programs, which vary from period to period depending on volume and vesting timing of awards. We adjust for these charges to facilitate comparisons from period to period. (d) Realized foreign exchange transactional gains/losses our management does not consider in our evaluation of our ongoing operations. (e) Other adjustments include amounts our management does not consider in our evaluation of our ongoing operations, including certain severance and other charges. |
Schedule of sales by merchandise category as a percentage of total net sales | Fiscal year ended April 1, February 27, February 28, Custom Closets(1) % % % Storage, Box, Shelving % % % Kitchen and Trash % % % Office, Collections, & Hooks % % % Bath, Travel, Laundry % % % Containers, Gift Packaging, Seasonal, Impulse % % % Other % % % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total % % % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Includes elfa®, TCS Closets®, elfa® Sliding Doors products and installation as well as closet completion products sold by the TCS segment and Elfa segment sales to third parties. |
Net income per common share (Ta
Net income per common share (Tables) | 12 Months Ended |
Apr. 01, 2017 | |
Net income per common share | |
Schedule of reconciliation of net income and the number of shares used in the basic and diluted net income per share calculations | Fiscal Year Ended April 2, February 27, February 28, Five Weeks Numerator: Net income $ $ $ $ Denominator: Weighted-average common shares—basic Options and other dilutive securities — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average common shares—diluted Net income per common share—basic and diluted $ $ $ $ Antidilutive securities not included: Stock options outstanding Nonvested restricted stock awards — — — |
Quarterly results of operatio42
Quarterly results of operations (unaudited) (Tables) | 12 Months Ended |
Apr. 01, 2017 | |
Quarterly results of operations (unaudited) | |
Schedule of quarterly results of operations | Fiscal Year Ended April 1, 2017 Fourth Quarter Third Quarter Second Quarter First Quarter Net sales $ $ $ $ Gross profit Income from operations Net income (loss) ) Weighted-average shares used in computing basic net income (loss) per share Weighted-average shares used in computing diluted net income (loss) per share Basic and diluted net income (loss) per common share $ $ $ $ ) Recast Fiscal Year Ended April 2, 2016 Fourth Quarter Third Quarter Second Quarter First Quarter Net sales $ $ $ $ Gross profit Income (loss) from operations ) Net income (loss) ) Weighted-average shares used in computing basic net income (loss) per share Weighted-average shares used in computing diluted net income (loss) per share Basic and diluted net income (loss) per common share $ $ $ $ ) |
Transition Period Financial I43
Transition Period Financial Information(Tables) | 12 Months Ended |
Apr. 01, 2017 | |
Transition Period Financial Information | |
Summary of unaudited comparative financial information | Five Weeks Ended (In thousands, except share and per share amounts) April 2, April 4, Consolidated statement of operations data: Net sales $ $ Gross profit Selling, general, and administrative expenses Income from operations Income before taxes Provision for income taxes Net income Net income per common share: Basic and diluted $ $ Weighted-average common shares—basic and diluted |
Nature of business and summar44
Nature of business and summary of significant accounting policies (Details) | Apr. 01, 2017ft²storestate |
Nature of business and summary of significant accounting policies | |
Number of stores | store | 86 |
Average size of stores (in square feet) | 25,000 |
Average selling square feet in stores (in square feet) | 19,000 |
Number of states | state | 31 |
Nature of business and summar45
Nature of business and summary of significant accounting policies - Fiscal year (Details) - item | 12 Months Ended | ||
Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Fiscal year | |||
Length of fiscal quarter | 91 days | ||
Number of four week months | 2 | ||
Number of five week months | 1 | ||
Length of fiscal year | 364 days | 364 days | 364 days |
Nature of business and summar46
Nature of business and summary of significant accounting policies - Gift cards and merchandise credits (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Apr. 02, 2016 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Gift cards and merchandise credits | ||||
Period of estimated performance | 48 months | |||
Gift card breakage recorded | $ 73 | $ 1,072 | $ 948 | $ 978 |
Advertising | ||||
Catalog and direct mailings costs capitalized | 605 | 938 | ||
Advertising expense incurred | $ 2,164 | 31,525 | 32,343 | $ 35,388 |
Income taxes | ||||
Uncertain tax positions requiring accrual | 0 | 0 | ||
Accounts receivable | ||||
Allowances for doubtful accounts | $ 305 | $ 128 |
Nature of business and summar47
Nature of business and summary of significant accounting policies - Property, plant, and equipment (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Apr. 02, 2016 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Property and equipment ,net: | ||||
Cost capitalized in connection with the development of internally used software | $ 299 | $ 4,392 | $ 3,272 | $ 5,017 |
Cost amortized in connection with the development of internally used software | $ 296 | $ 3,498 | $ 3,258 | $ 2,992 |
Buildings | ||||
Property and equipment ,net: | ||||
Estimated useful lives | 30 years | |||
Furniture, fixtures, and equipment | Minimum | ||||
Property and equipment ,net: | ||||
Estimated useful lives | 3 years | |||
Furniture, fixtures, and equipment | Maximum | ||||
Property and equipment ,net: | ||||
Estimated useful lives | 10 years | |||
Computer software | Minimum | ||||
Property and equipment ,net: | ||||
Estimated useful lives | 2 years | |||
Computer software | Maximum | ||||
Property and equipment ,net: | ||||
Estimated useful lives | 5 years |
Nature of business and summar48
Nature of business and summary of significant accounting policies - Foreign currency forward contracts (Details) $ in Thousands | 12 Months Ended | |
Apr. 01, 2017USD ($)item | Feb. 27, 2016USD ($) | |
Foreign currency forward contracts | ||
Minimum term period of currency-related hedge instruments | 1 month | 1 month |
Maximum term period of currency-related hedge instruments | 12 months | 12 months |
Self-insured liabilities | ||
Self-insurance reserves recorded in accrued liabilities | $ | $ 3,016 | $ 3,471 |
Goodwill | ||
Number of reporting units | item | 2 |
Nature of business and summar49
Nature of business and summary of significant accounting policies - Foreign currency translation and Recent accounting pronouncements (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Apr. 02, 2016USD ($) | Apr. 01, 2017USD ($) | Feb. 27, 2016USD ($) | Feb. 28, 2015USD ($) | |
Debt issuance costs, net | ||||
Deferred financing costs, net | $ 3,987 | |||
Senior secured term loan facility | ||||
Debt issuance costs, net | ||||
Deferred financing costs, net | 3,667 | |||
Selling, general and administrative expenses | ||||
Foreign currency translation | ||||
Realized gains/losses | $ 60 | $ 342 | $ (241) | $ 171 |
Elfa | ||||
Foreign currency translation | ||||
Exchange rate from Swedish Krona to U.S. Dollar | 8.9 | 8.6 | ||
Carrying amounts of net assets | $ 108,707 | $ 109,548 | ||
Adjustment | ASU 2015-03 | Senior secured term loan facility | ||||
Debt issuance costs, net | ||||
Deferred financing costs, net | $ 3,667 | $ 5,649 |
Goodwill and trade names (Detai
Goodwill and trade names (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Apr. 02, 2016 | Dec. 31, 2016 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Goodwill and trade names | |||||
Goodwill and intangible asset impairment | $ 0 | ||||
Impairment charges for goodwill | $ 0 | $ 0 | $ 0 | ||
Changes in the carrying amount of goodwill | |||||
Gross balance at the beginning of the period | $ 410,467 | 410,467 | 410,467 | ||
Accumulated impairment charges at the beginning of the period | (207,652) | (207,652) | (207,652) | ||
Total, net balance at the beginning of the period | 202,815 | 202,815 | 202,815 | ||
Gross balance at the end of the period | 410,467 | 410,467 | 410,467 | 410,467 | |
Accumulated impairment charges at the end of the period | (207,652) | (207,652) | (207,652) | (207,652) | |
Total, net balance at the end of the period | 202,815 | 202,815 | 202,815 | 202,815 | |
Trade names | |||||
Goodwill and trade names | |||||
Impairment charge | 0 | 0 | 0 | ||
Changes in the carrying amount of trade names | |||||
Gross balance at the beginning of the period | 259,902 | 262,325 | 260,967 | ||
Accumulated impairment charges at the beginning of the period | (31,534) | (31,534) | (31,534) | ||
Total, net balance at the beginning of the period | 228,368 | 230,791 | 229,433 | ||
Foreign currency translation adjustments | 2,423 | (4,106) | (1,065) | ||
Gross balance at the end of the period | 262,325 | 258,219 | 259,902 | 260,967 | |
Accumulated impairment charges at the end of the period | (31,534) | (31,534) | (31,534) | (31,534) | |
Total, net balance at the end of the period | $ 230,791 | $ 226,685 | $ 228,368 | $ 229,433 |
Detail of certain balance she51
Detail of certain balance sheet accounts (Details) - USD ($) $ in Thousands | Apr. 01, 2017 | Feb. 27, 2016 |
Accounts receivable, net: | ||
Trade receivables, net | $ 15,873 | $ 14,748 |
Credit card receivables | 6,531 | 10,630 |
Tenant allowances | 2,353 | 1,721 |
Other receivables | 2,719 | 1,744 |
Accounts receivable, net | 27,476 | 28,843 |
Inventory: | ||
Finished goods | 98,438 | 81,496 |
Raw materials | 4,183 | 3,363 |
Work in progress | 499 | 1,576 |
Inventory | 103,120 | 86,435 |
Property and equipment | ||
Property and equipment, gross | 421,233 | 397,411 |
Less accumulated depreciation and amortization | (255,735) | (221,294) |
Property and equipment, net | 165,498 | 176,117 |
Accrued Liabilities: | ||
Accrued payroll, benefits and bonuses | 20,897 | 22,483 |
Unearned revenue | 7,708 | 16,034 |
Accrued transaction and property tax | 11,086 | 9,655 |
Gift cards and store credits outstanding | 9,229 | 8,564 |
Accrued lease liabilities | 4,767 | 4,384 |
Accrued interest | 143 | 2,270 |
Other accrued liabilities | 6,277 | 6,245 |
Accrued Liabilities | 60,107 | 69,635 |
Land and buildings | ||
Property and equipment | ||
Property and equipment, gross | 20,758 | 20,699 |
Furniture and fixtures | ||
Property and equipment | ||
Property and equipment, gross | 68,837 | 63,375 |
Machinery and equipment | ||
Property and equipment | ||
Property and equipment, gross | 83,523 | 73,218 |
Computer software and equipment | ||
Property and equipment | ||
Property and equipment, gross | 81,380 | 72,619 |
Leasehold improvements | ||
Property and equipment | ||
Property and equipment, gross | 152,630 | 147,347 |
Construction in progress | ||
Property and equipment | ||
Property and equipment, gross | 13,188 | 19,377 |
Leased vehicles and other | ||
Property and equipment | ||
Property and equipment, gross | $ 917 | $ 776 |
Long-term debt and revolving 52
Long-term debt and revolving lines of credit (Details) - USD ($) $ in Thousands | Apr. 01, 2017 | Feb. 27, 2016 |
Long-term debt and revolving lines of credit | ||
Total debt | $ 321,138 | $ 327,878 |
Less current portion | (5,445) | (6,094) |
Total long-term debt | 312,026 | 316,135 |
Senior secured term loan facility | ||
Long-term debt and revolving lines of credit | ||
Total debt | 316,760 | 321,288 |
Less deferred financing costs | (3,667) | (5,649) |
Obligations under capital leases | ||
Long-term debt and revolving lines of credit | ||
Total debt | 901 | 745 |
Other loans | ||
Long-term debt and revolving lines of credit | ||
Total debt | 119 | 224 |
2014 Elfa term loan facility | ||
Long-term debt and revolving lines of credit | ||
Total debt | $ 3,358 | 4,900 |
2014 Elfa revolving credit facility | ||
Long-term debt and revolving lines of credit | ||
Total debt | $ 721 |
Long-term debt and revolving 53
Long-term debt and revolving lines of credit - Scheduled total revolving lines of credit and debt maturities (Details) - USD ($) $ in Thousands | Apr. 01, 2017 | Feb. 27, 2016 |
Scheduled total revolving lines of credit and debt maturities | ||
Within 1 year | $ 5,445 | |
2 years | 4,365 | |
3 years | 311,328 | |
Total debt | $ 321,138 | $ 327,878 |
Long-term debt and revolving 54
Long-term debt and revolving lines of credit - Senior secured term loan facility & Revolving credit facility (Details) $ in Thousands | Apr. 06, 2012USD ($) | Apr. 01, 2017USD ($) | Feb. 27, 2016USD ($) |
Long-term debt and revolving lines of credit | |||
Restricted net assets of consolidated subsidiaries | $ 209,290 | ||
Revolving credit facility | |||
Long-term debt and revolving lines of credit | |||
Maximum borrowing capacity | $ 100,000 | ||
Amount of increase in commitments upon such request from the Company | 50,000 | ||
Swing line advances limit | 15,000 | ||
Letter of credit facility sub-limit | $ 40,000 | ||
Percentage of eligible credit card receivables used for determining total amount of availability | 90.00% | ||
Percentage of appraised value of eligible inventory used for determining total amount of availability | 90.00% | ||
Consolidated fixed-charge coverage ratio to be maintained if excess availability is less than $10,000 at any time | 1 | ||
Amount of availability under facility | $ 73,189 | ||
Maximum borrowings, including letters of credit issued | $ 33,590 | ||
Revolving credit facility | Minimum | |||
Long-term debt and revolving lines of credit | |||
Threshold fixed charge coverage ratio for payment of dividend | 1.25 | ||
Revolving credit facility | Maximum | |||
Long-term debt and revolving lines of credit | |||
First priority security interest in stock in foreign subsidiaries (as a percent) | 65.00% | ||
Amount of dividend payable during term of debt | $ 10,000 | ||
Threshold amount of excess availability for which consolidated fixed-charge coverage ratio of 1.0 to 1.0 is to be maintained | $ 10,000 | ||
Revolving credit facility | LIBOR | |||
Long-term debt and revolving lines of credit | |||
Interest rate margin (as a percent) | 1.25% | 1.25% | |
Senior secured term loan facility | |||
Long-term debt and revolving lines of credit | |||
Outstanding borrowings | $ 316,760 | ||
Quarterly principal repayments | 906 | $ 906 | |
Balloon payment for the remaining balance | $ 310,420 | ||
Senior secured term loan facility | Maximum | |||
Long-term debt and revolving lines of credit | |||
First priority security interest in stock in foreign subsidiaries (as a percent) | 65.00% | ||
Amount of dividend payable during term of debt | $ 10,000 | ||
Threshold consolidated net leverage ratio for payment of dividend | 2 | ||
Senior secured term loan facility | LIBOR | |||
Long-term debt and revolving lines of credit | |||
Interest rate margin (as a percent) | 3.25% | ||
Floor interest rate for reference rate (as a percent) | 1.00% |
Long-term debt and revolving 55
Long-term debt and revolving lines of credit - Elfa Senior Secured Credit Facilities and 2014 Elfa Senior Secured Credit Facilities (Details) SEK in Thousands, $ in Thousands | May 13, 2014SEK | Apr. 01, 2014SEK | Apr. 27, 2009SEK | Apr. 01, 2017SEK | Apr. 01, 2017USD ($) | Aug. 28, 2014USD ($) |
Elfa senior secured credit facilities | ||||||
Long-term debt and revolving lines of credit | ||||||
Frequency of principal payments | quarterly | |||||
Quarterly principal repayments | SEK 6,250 | |||||
Elfa senior secured credit facilities | STIBOR | ||||||
Long-term debt and revolving lines of credit | ||||||
Interest rate margin (as a percent) | 1.775% | |||||
Elfa term loan facility | ||||||
Long-term debt and revolving lines of credit | ||||||
Maximum borrowing capacity | SEK 137,500 | |||||
Elfa revolving credit facility | ||||||
Long-term debt and revolving lines of credit | ||||||
Face amount | SEK 175,000 | |||||
2014 Elfa term loan facility | ||||||
Long-term debt and revolving lines of credit | ||||||
Face amount | SEK 60,000 | $ 6,715 | ||||
Quarterly principal repayments | SEK 3,000 | 336 | ||||
2014 Elfa term loan facility | STIBOR | ||||||
Long-term debt and revolving lines of credit | ||||||
Interest rate margin (as a percent) | 1.70% | |||||
2014 Elfa revolving credit facility | ||||||
Long-term debt and revolving lines of credit | ||||||
Maximum borrowing capacity | SEK 140,000 | 15,669 | ||||
Amount of availability under facility | $ | $ 15,669 | |||||
2014 Elfa revolving credit facility | Nordea's base rate | ||||||
Long-term debt and revolving lines of credit | ||||||
Interest rate margin (as a percent) | 1.40% | |||||
Short Term Credit Facility | ||||||
Long-term debt and revolving lines of credit | ||||||
Maximum borrowing capacity | SEK 15,000 | |||||
Interest rate (as a percent) | 2.53% | |||||
Amount outstanding at time of payoff | $ | $ 2,152 | |||||
Minimum | Elfa senior secured credit facilities | ||||||
Long-term debt and revolving lines of credit | ||||||
Consolidated equity ratio in year one | 30.00% | |||||
Consolidated equity ratio after year one | 32.50% | |||||
Maximum | Elfa senior secured credit facilities | ||||||
Long-term debt and revolving lines of credit | ||||||
Consolidated ratio of net debt to EBITDA at end of each calendar quarter | 3.2 | 3.2 |
Long-term debt and revolving 56
Long-term debt and revolving lines of credit - Deferred financing costs (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Apr. 02, 2016 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Long-term debt and revolving lines of credit | ||||
Amortization expense of deferred financing costs | $ 160 | $ 1,921 | $ 1,940 | $ 1,956 |
Amortization expense of deferred financing costs: | ||||
Within 1 year | 1,925 | |||
2 years | 1,926 | |||
3 years | 92 | |||
4 years | 44 | |||
Total | 3,987 | |||
Senior secured term loan facility | ||||
Amortization expense of deferred financing costs: | ||||
Within 1 year | 1,833 | |||
2 years | 1,834 | |||
Total | 3,667 | |||
Revolving credit facility | ||||
Amortization expense of deferred financing costs: | ||||
Within 1 year | 92 | |||
2 years | 92 | |||
3 years | 92 | |||
4 years | 44 | |||
Total | $ 320 |
Income taxes (Details)
Income taxes (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Apr. 02, 2016 | Apr. 04, 2015 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Income before income taxes: | |||||
U.S. | $ 1,059 | $ 19,307 | $ 4,830 | $ 20,597 | |
Foreign | (367) | 5,048 | 3,221 | 9,269 | |
Income before taxes | 692 | $ 978 | 24,355 | 8,051 | 29,866 |
Current | |||||
Federal | 235 | 6,039 | (385) | 3,438 | |
State | 63 | 1,374 | 585 | 1,483 | |
Foreign | (778) | 2,085 | 1,850 | 849 | |
Total current provision | (480) | 9,498 | 2,050 | 5,770 | |
Deferred | |||||
Federal | 122 | 553 | 1,881 | 1,263 | |
State | (46) | 22 | 57 | 646 | |
Foreign | 742 | (671) | (1,079) | (486) | |
Total deferred provision (benefit) | 818 | (96) | 859 | 1,423 | |
Total provision for income taxes | $ 338 | $ 340 | $ 9,402 | $ 2,909 | $ 7,193 |
Income taxes - Differences betw
Income taxes - Differences between the actual provision for income taxes and the amounts computed by applying the statutory federal tax rate to income before taxes (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Apr. 02, 2016 | Apr. 04, 2015 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Differences between the actual (benefit) provision for income taxes and the amounts computed by applying the statutory federal tax rate to income before taxes | |||||
Provision computed at federal statutory rate | $ 242 | $ 8,525 | $ 2,818 | $ 10,453 | |
Permanent differences | 10 | 536 | 192 | 163 | |
Change in valuation allowance | 37 | 178 | 248 | (815) | |
State income taxes, net of federal benefit | 11 | 855 | 402 | 1,296 | |
Effect of foreign income taxes | 53 | (619) | (384) | (1,131) | |
Prior period error | (1,839) | ||||
Non-taxable gain on sale of Norwegian subsidiary | (690) | ||||
Economic zone credits | (292) | (255) | |||
Other, net | (15) | (73) | (75) | 11 | |
Total provision for income taxes | $ 338 | $ 340 | $ 9,402 | $ 2,909 | $ 7,193 |
Income taxes - Components of de
Income taxes - Components of deferred tax assets and liabilities (Details) - USD ($) $ in Thousands | Apr. 01, 2017 | Feb. 27, 2016 |
Deferred tax assets: | ||
Inventory | $ 1,763 | $ 1,745 |
Loss and credit carryforwards | 3,445 | 4,334 |
Stock compensation | 7,220 | 6,878 |
Accrued liabilities | 4,439 | 5,363 |
Capital assets | 352 | 126 |
Deferred tax assets before valuation allowance | 17,219 | 18,446 |
Valuation allowance | (2,015) | (1,880) |
Total deferred tax assets | 15,204 | 16,566 |
Deferred tax liabilities: | ||
Intangibles | (82,775) | (83,200) |
Capital assets | (7,412) | (8,046) |
Other | (3,557) | (3,950) |
Total deferred tax liabilities | (93,744) | (95,196) |
Net deferred tax liabilities | $ (78,540) | $ (78,630) |
Income taxes - Valuation allowa
Income taxes - Valuation allowance (Details) $ in Thousands | 3 Months Ended |
Feb. 28, 2015USD ($) | |
France | |
Valuation allowance | |
Tax benefit from a release of valuation allowance | $ 100 |
Income taxes - Operating loss c
Income taxes - Operating loss carryovers (Details) - USD ($) $ in Thousands | Apr. 01, 2017 | Feb. 27, 2016 |
Foreign and Domestic | ||
Operating loss carryovers | ||
Tax credits | $ 1,490 | $ 1,661 |
Foreign and State | ||
Operating loss carryovers | ||
Deferred tax assets for net operating loss carryovers | 1,955 | 1,888 |
Valuation allowances | $ 1,753 | $ 1,687 |
Income taxes - ASC 740-30 (Deta
Income taxes - ASC 740-30 (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Apr. 01, 2017 | Feb. 27, 2016 | |
Income taxes | ||
Undistributed foreign earnings that have been indefinitely reinvested | $ 33,237 | $ 33,149 |
Provision for taxes due upon remittance of foreign earnings | $ 0 | $ 0 |
Employee benefit plans 401(k) P
Employee benefit plans 401(k) Plan (Details) - USD ($) $ in Thousands | Jan. 01, 2016 | Apr. 02, 2016 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 |
401(k) Plan | |||||
Number of months of service required to be completed by employees to be eligible to participate in plan | 11 months | ||||
Maximum contribution by participants (as a percent) | 80.00% | ||||
Maximum contribution by participants | $ 18 | ||||
Percentage of employee contributions matched by the company | 100.00% | 100.00% | |||
Total net periodic benefit cost | $ 309 | $ 58 | $ 3,165 | $ 2,737 | |
Maximum | |||||
401(k) Plan | |||||
Matching contribution by the company as a percentage of compensation | 4.00% | 4.00% | |||
Participants aged 50 years and over | |||||
401(k) Plan | |||||
Maximum contribution by participants | $ 24 |
Employee benefit plans - Nonqua
Employee benefit plans - Nonqualified retirement plan (Details) - Nonqualified retirement plan - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Apr. 02, 2016 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Pension plans | ||||
Matching Contribution | $ 0 | $ 0 | $ 0 | $ 0 |
Other current assets | ||||
Pension plans | ||||
Fair value of the plan asset | 5,092 | 3,947 | ||
Accrued liabilities | ||||
Pension plans | ||||
Carrying value of the plan liability | $ 5,086 | $ 3,962 |
Employee benefit plans - Pensio
Employee benefit plans - Pension plan (Details) - Pension plan - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Apr. 02, 2016 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Change in benefit obligation: | ||||
Projected benefit obligation, beginning of year | $ 3,486 | $ 3,691 | $ 3,610 | |
Service cost | 6 | 67 | 86 | $ 62 |
Interest cost | 10 | 117 | 103 | 131 |
Benefits paid | (77) | (90) | ||
Actuarial loss (gain) | 710 | (133) | ||
Exchange rate gain | (370) | (90) | ||
Projected benefit obligation, end of year | 3,691 | 4,138 | 3,486 | 3,610 |
Underfunded status, end of year | $ (4,138) | $ (3,486) | ||
Discount rate (as a percent) | 3.30% | 3.40% | ||
Rate of pay increases (as a percent) | 3.00% | 3.00% | ||
Components of net periodic benefit cost: | ||||
Service cost | 6 | $ 67 | $ 86 | 62 |
Interest cost | 10 | 117 | 103 | 131 |
Amortization of unrecognized net loss | 37 | 45 | 38 | |
Net periodic benefit cost for defined benefit plan | 16 | 221 | 234 | 231 |
Defined contribution plans | 129 | 1,904 | 2,246 | 2,292 |
Total net periodic benefit cost | $ 145 | $ 2,125 | $ 2,480 | $ 2,523 |
Elfa | ||||
Pension plans | ||||
Percentage of employees who are plan participants | 3.00% |
Stock-based compensation (Detai
Stock-based compensation (Details) - USD ($) $ in Thousands | Aug. 01, 2016 | Aug. 03, 2015 | Oct. 27, 2014 | Sep. 01, 2014 | Apr. 02, 2016 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 |
Stock-based compensation | ||||||||
Stock-based compensation expense (in dollars) | $ 1,289 | |||||||
Nonqualified stock options | ||||||||
Stock-based compensation | ||||||||
Stock-based compensation expense (in dollars) | $ 147 | $ 1,526 | $ 1,556 | 1,289 | ||||
Unrecognized compensation cost (in dollars) | $ 4,257 | |||||||
Average remaining service period for recognition of unrecognized compensation cost | 1 year 8 months 12 days | |||||||
Intrinsic value | $ 0 | 2 | 369 | |||||
Fair value of shares vested | $ 1,464 | $ 1,367 | $ 1,205 | |||||
2013 Equity Plan | ||||||||
Stock-based compensation | ||||||||
Number of shares reserved for issuance | 3,616,570 | |||||||
Number of shares available for grant | 522,004 | |||||||
2013 Equity Plan | Nonqualified stock options | ||||||||
Stock-based compensation | ||||||||
Awards granted (in shares) | 276,075 | 94,568 | 80,200 | 24,649 | ||||
Vesting period | 3 years | 3 years | 3 years | 7 years |
Stock-based compensation - Stoc
Stock-based compensation - Stock option activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | 13 Months Ended | |
Apr. 02, 2016 | Feb. 27, 2016 | Feb. 28, 2015 | Apr. 01, 2017 | |
Shares | ||||
Beginning balance (in shares) | 2,890,476 | 2,856,005 | 2,827,492 | 2,890,476 |
Granted (in shares) | 0 | 94,568 | 104,849 | 276,075 |
Exercised (in shares) | 0 | (3,315) | (42,480) | 0 |
Forfeited (in shares) | (6,690) | (41,791) | (32,202) | (98,815) |
Expired (in shares) | (576) | (14,991) | (1,654) | (121,708) |
Ending balance (in shares) | 2,890,476 | 2,890,476 | 2,856,005 | 2,946,028 |
Vested and exercisable at end of year (in shares) | 2,110,661 | 1,975,068 | 2,156,537 | |
Weighted-average exercise price | ||||
Balance at the beginning of the period (in dollars per share) | $ 18.02 | $ 18.04 | $ 17.92 | $ 18.02 |
Granted (in dollars per share) | 17.28 | 21.02 | 5.35 | |
Exercised (in dollars per share) | 17.71 | 17.47 | ||
Forfeited (in dollars per share) | 18 | 18 | 18.63 | |
Expired (in dollars per share) | 17.80 | 17.67 | 17.95 | |
Balance at the end of the period (in dollars per share) | $ 18.02 | 18.02 | 18.04 | 16.81 |
Exercisable at the end of the period (in dollars per share) | $ 17.95 | $ 17.90 | $ 17.98 | |
Weighted-average contractual term remaining | ||||
Balance at end of year | 7 years 7 months 28 days | 8 years 7 months 6 days | 6 years 9 months 29 days | |
Exercisable at the end of the period | 7 years 6 months 18 days | 8 years 6 months 11 days | 6 years 6 months 4 days | |
Aggregate intrinsic value | ||||
Balance at the end of the period | $ 1,376 | |||
Exercisable at the end of the period | $ 1,036 |
Stock-based compensation - Fair
Stock-based compensation - Fair value of stock options (Details) - $ / shares | 12 Months Ended | 13 Months Ended | |
Feb. 27, 2016 | Feb. 28, 2015 | Apr. 01, 2017 | |
Stock-based compensation | |||
Weighted average grant date fair value (in dollars per share) | $ 8.46 | $ 8.14 | $ 3.26 |
Weighted-average assumptions used to measure the grant date fair value of the non-qualified stock options granted under the 2013 Equity Plan using the Black Scholes option pricing model | |||
Expected term | 6 years | 6 years 1 month 6 days | 6 years |
Expected volatility (as a percent) | 50.30% | 50.40% | 67.90% |
Risk-free interest rate (as a percent) | 1.70% | 1.80% | 1.20% |
Dividend yield (as a percent) | 0.00% | 0.00% | 0.00% |
Stock-based compensation - Rest
Stock-based compensation - Restricted stock awards (Details) - USD ($) $ / shares in Units, $ in Thousands | Apr. 01, 2017 | Aug. 02, 2016 | Jul. 01, 2016 | Apr. 01, 2017 |
Restricted shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total number of restricted shares granted (in shares) | 621,779 | |||
Grant-date fair value (in dollars per share) | $ 5.37 | |||
Stock-based compensation cost related to restricted stock awards | $ 463 | |||
Unrecognized compensation expense related to outstanding restricted stock awards | $ 1,009 | $ 1,009 | ||
Average remaining service period for recognition of unrecognized compensation cost | 1 year 10 months 24 days | |||
2013 Equity Plan | Restricted shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total number of restricted shares granted (in shares) | 248,937 | 372,842 | ||
Grant-date fair value (in dollars per share) | $ 5.29 | $ 5.42 | ||
2013 Equity Plan | Time-based restricted shares granted on July 1, 2016 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 2 years 9 months | |||
2013 Equity Plan | Time-based restricted shares granted on August 2, 2016 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 2 years 8 months 1 day | |||
2013 Equity Plan | Performance-based restricted shares granted on July 1, 2016 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years 9 months | |||
Performance-based restricted shares | 104,320 | |||
2013 Equity Plan | Performance-based restricted shares granted on August 2, 2016 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years 8 months 1 day | |||
Performance-based restricted shares | 61,552 |
Stock-based compensation - Re70
Stock-based compensation - Restricted stock awards activity (Details) - Restricted shares | 13 Months Ended |
Apr. 01, 2017$ / sharesshares | |
Restricted Stock Awards | |
Granted (in shares) | shares | 621,779 |
Vested (in shares) | shares | (31,216) |
Forfeited (in shares) | shares | (334,923) |
Withheld related to net settlement (in shares) | shares | (9,106) |
Nonvested, Ending balance (in shares) | shares | 246,534 |
Weighted Average Grant Date Fair Value | |
Granted (in dollars per share) | $ / shares | $ 5.37 |
Vested (in dollars per share) | $ / shares | 5.37 |
Forfeited (in dollars per share) | $ / shares | 5.36 |
Withheld related to net settlement (in dollars per share) | $ / shares | 5.37 |
Nonvested, Balance at the end of the period (in dollars per share) | $ / shares | $ 5.37 |
Shareholders' equity - Common s
Shareholders' equity - Common stock (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Apr. 01, 2017USD ($)Vote$ / sharesshares | Feb. 27, 2016$ / sharesshares | Mar. 01, 2014$ / shares | |
Shareholders' equity | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 250,000,000 | 250,000,000 | |
Common stock, shares issued | 48,045,114 | 47,986,975 | |
Common stock | |||
Shareholders' equity | |||
Shares issued | 26,923 | ||
Issue price (in dollars per share) | $ / shares | $ 5.01 | ||
Number of votes per share entitled to holders | Vote | 1 | ||
Redemptions or sinking fund provisions | $ | $ 0 |
Shareholders' equity - Preferre
Shareholders' equity - Preferred stock (Details) | Apr. 01, 2017$ / sharesshares |
Shareholders' equity | |
Preferred stock, shares authorized | 5,000,000 |
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 |
Preferred stock, shares issued | 0 |
Preferred stock, shares outstanding | 0 |
Accumulated other comprehensi73
Accumulated other comprehensive income (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |
Apr. 02, 2016 | Apr. 01, 2017 | Feb. 27, 2016 | |
Rollforward of the amounts included in AOCI, net of taxes | |||
Balance at the beginning of period | $ 207,068 | $ 211,568 | $ 201,862 |
Balance at the end of period | 211,568 | 221,790 | 207,068 |
Unrecognized net actuarial loss included in accumulated other comprehensive income | 1,444 | 992 | |
Pension liability adjustment | |||
Rollforward of the amounts included in AOCI, net of taxes | |||
Balance at the beginning of period | (992) | (1,058) | (1,167) |
Other comprehensive (loss) income before reclassifications, net of tax | (66) | (413) | 138 |
Amounts reclassified to earnings, net of tax | 27 | 37 | |
Net current period other comprehensive income (loss) | (66) | (386) | 175 |
Balance at the end of period | (1,058) | (1,444) | (992) |
Foreign currency translation | |||
Rollforward of the amounts included in AOCI, net of taxes | |||
Balance at the beginning of period | (18,814) | (14,761) | (16,293) |
Other comprehensive (loss) income before reclassifications, net of tax | 4,053 | (6,283) | (2,521) |
Net current period other comprehensive income (loss) | 4,053 | (6,283) | (2,521) |
Balance at the end of period | (14,761) | (21,044) | (18,814) |
Accumulated other comprehensive income (loss) | |||
Rollforward of the amounts included in AOCI, net of taxes | |||
Balance at the beginning of period | (19,835) | (15,836) | (18,342) |
Other comprehensive (loss) income before reclassifications, net of tax | 3,987 | (7,239) | (2,430) |
Amounts reclassified to earnings, net of tax | 12 | 432 | 937 |
Net current period other comprehensive income (loss) | 3,999 | (6,807) | (1,493) |
Balance at the end of period | (15,836) | (22,643) | (19,835) |
Foreign currency hedge instruments | |||
Rollforward of the amounts included in AOCI, net of taxes | |||
Balance at the beginning of period | (29) | (17) | (882) |
Other comprehensive (loss) income before reclassifications, net of tax | (543) | (47) | |
Amounts reclassified to earnings, net of tax | 12 | 405 | 900 |
Net current period other comprehensive income (loss) | 12 | (138) | 853 |
Balance at the end of period | $ (17) | $ (155) | $ (29) |
Foreign currency forward cont74
Foreign currency forward contracts (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Apr. 02, 2016 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Purchase of inventory from use of forward contracts in Swedish krona (as a percent) | 0.00% | 78.00% | 54.00% | 54.00% |
Purchase of U.S. dollars from use of forward contracts | $ 155 | $ 3,905 | $ 5,495 | $ 4,300 |
Purchase of U.S. dollars from use of forward contracts as a percent of Elfa's U.S. Dollar purchases | 23.00% | 56.00% | 67.00% | 64.00% |
Currency Related Hedge Instruments Term Minimum | 1 month | 1 month | ||
Currency Related Hedge Instruments Term Maximum | 12 months | 12 months | ||
Accumulated other comprehensive loss | $ 22,643 | $ 19,835 | ||
Foreign currency forward contracts | Not Designated as Hedging Instrument | ||||
Gain associated with forward contracts not designated as hedge instruments | 120 | |||
Foreign currency hedge instruments | ||||
Accumulated other comprehensive loss | 155 | |||
Foreign currency hedge instruments | Designated as Hedging Instrument | Cash Flow Hedging | ||||
Unrealized loss for settled foreign currency hedge instruments | 562 | |||
Unrealized loss to be reclassified into earnings over the next 12 months | $ 562 |
Leases (Details)
Leases (Details) | 12 Months Ended |
Apr. 01, 2017store | |
Leases | |
Number of stores | 86 |
Minimum | |
Leases | |
Lease term | 1 year |
Renewal period for the stores | 5 years |
Maximum | |
Leases | |
Lease term | 20 years |
Renewal period for the stores | 20 years |
Leases - Future minimum lease p
Leases - Future minimum lease payments (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Apr. 02, 2016 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Future minimum lease payments due under noncancellable operating leases: | ||||
Within 1 year | $ 81,680 | |||
2 years | 79,427 | |||
3 years | 68,225 | |||
4 years | 63,496 | |||
5 years | 48,380 | |||
Thereafter | 217,116 | |||
Total minimum lease payments | 558,324 | |||
Future minimum lease payments due under noncancellable capital leases: | ||||
within 1 year | 393 | |||
2 years | 293 | |||
3 years | 237 | |||
Total minimum lease payments | 923 | |||
Less amount representing interest | (22) | |||
Present value of minimum lease payments | 901 | |||
Rent expense | $ 6,495 | 80,647 | $ 75,834 | $ 72,643 |
Percentage-of-sales rent expense included in rent expense | $ 32 | $ 416 | $ 450 | $ 633 |
Commitments and contingencies (
Commitments and contingencies (Details) $ in Thousands | Apr. 01, 2017USD ($) |
Standby letters of credit | |
Commitments and contingencies | |
Amount outstanding | $ 4,143 |
Fair value measurements (Detail
Fair value measurements (Details) - USD ($) $ in Thousands | Apr. 01, 2017 | Feb. 27, 2016 |
Fair value | ||
Liabilities | ||
Estimated fair value of long-term debt, including current maturities | $ 295,005 | $ 221,534 |
Recurring | ||
Assets | ||
Total assets | 5,933 | 4,053 |
Recurring | Other current assets | ||
Assets | ||
Nonqualified retirement plan | 5,092 | 3,947 |
Not Designated as Hedging Instrument | Recurring | Foreign currency forward contracts | Level 2 | Other current assets | ||
Assets | ||
Foreign currency forward contracts | $ 841 | $ 106 |
Segment reporting (Details)
Segment reporting (Details) | 12 Months Ended |
Apr. 01, 2017segmentcountry | |
Segment reporting | |
Number of reportable segments | segment | 2 |
Elfa | |
Segment reporting | |
Number of countries in which products are sold on wholesale basis | country | 30 |
Segment reporting - Earnings or
Segment reporting - Earnings or loss before income taxes for operating segments (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||
Apr. 02, 2016 | Apr. 04, 2015 | Apr. 01, 2017 | Dec. 31, 2016 | Oct. 01, 2016 | Jul. 02, 2016 | Apr. 02, 2016 | Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Segment reporting | |||||||||||||
Sales | $ 69,218 | $ 66,761 | $ 221,042 | $ 216,380 | $ 205,060 | $ 177,448 | $ 209,881 | $ 212,836 | $ 204,412 | $ 169,958 | $ 819,930 | $ 794,630 | $ 781,866 |
Adjusted EBITDA | 5,439 | 86,559 | 68,159 | 88,230 | |||||||||
Depreciation and amortization | 3,009 | 37,124 | 34,230 | 31,011 | |||||||||
Interest expense, net | 1,550 | 16,687 | 16,810 | 17,105 | |||||||||
Capital expenditures | 2,435 | 28,515 | 46,431 | 48,740 | |||||||||
Goodwill | 202,815 | 202,815 | $ 202,815 | 202,815 | 202,815 | 202,815 | |||||||
Trade names | 226,685 | 226,685 | 228,368 | ||||||||||
Assets | 761,834 | 761,834 | 758,119 | ||||||||||
TCS | |||||||||||||
Segment reporting | |||||||||||||
Net benefit on deferred compensation related to amendment and restatement of employment agreement | 3,900 | ||||||||||||
Operating segments | TCS | |||||||||||||
Segment reporting | |||||||||||||
Sales | 64,331 | 752,675 | 724,079 | 697,699 | |||||||||
Adjusted EBITDA | 5,271 | 75,268 | 58,827 | 72,109 | |||||||||
Depreciation and amortization | 2,543 | 31,572 | 28,767 | 24,945 | |||||||||
Interest expense, net | 1,532 | 16,403 | 16,484 | 16,543 | |||||||||
Capital expenditures | 1,640 | 25,901 | 42,412 | 40,785 | |||||||||
Goodwill | 202,815 | 202,815 | 202,815 | ||||||||||
Trade names | 187,048 | 187,048 | 187,048 | ||||||||||
Assets | 656,884 | 656,884 | 654,611 | ||||||||||
Operating segments | Elfa | |||||||||||||
Segment reporting | |||||||||||||
Sales | 4,887 | 67,255 | 70,551 | 84,167 | |||||||||
Adjusted EBITDA | (471) | 11,186 | 9,157 | 16,073 | |||||||||
Depreciation and amortization | 466 | 5,552 | 5,463 | 6,066 | |||||||||
Interest expense, net | 18 | 284 | 326 | 562 | |||||||||
Capital expenditures | 795 | 2,614 | 4,019 | 7,955 | |||||||||
Trade names | 39,637 | 39,637 | 41,320 | ||||||||||
Assets | 107,998 | 107,998 | 107,136 | ||||||||||
lntersegment | |||||||||||||
Segment reporting | |||||||||||||
Sales | (1,990) | (47,898) | (47,010) | (51,291) | |||||||||
Adjusted EBITDA | 639 | 105 | 175 | 48 | |||||||||
lntersegment | Elfa | |||||||||||||
Segment reporting | |||||||||||||
Sales | 1,990 | 47,898 | 47,010 | 51,291 | |||||||||
Corporate/other | |||||||||||||
Segment reporting | |||||||||||||
Adjusted EBITDA | $ 639 | 105 | 175 | $ 48 | |||||||||
Assets | $ (3,048) | $ (3,048) | $ (3,628) |
Segment reporting - Reconciliat
Segment reporting - Reconciliation of Adjusted EBITDA by segment to income (loss) before taxes (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Apr. 02, 2016 | Apr. 04, 2015 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Segment reporting | |||||
Total Adjusted EBITDA | $ 5,439 | $ 86,559 | $ 68,159 | $ 88,230 | |
Depreciation and amortization | (3,009) | (37,124) | (34,230) | (31,011) | |
Interest expense, net | (1,550) | (16,687) | (16,810) | (17,105) | |
Pre-opening costs | (191) | (6,852) | (9,033) | (8,283) | |
Noncash rent | 200 | 1,365 | 1,844 | 374 | |
Stock-based compensation | (147) | (1,989) | (1,556) | (1,289) | |
Foreign exchange gains (losses) | (60) | 342 | (241) | 171 | |
Other adjustments | 10 | (1,259) | (82) | (1,221) | |
Income before taxes | 692 | $ 978 | 24,355 | 8,051 | 29,866 |
Operating segments | TCS | |||||
Segment reporting | |||||
Total Adjusted EBITDA | 5,271 | 75,268 | 58,827 | 72,109 | |
Depreciation and amortization | (2,543) | (31,572) | (28,767) | (24,945) | |
Interest expense, net | (1,532) | (16,403) | (16,484) | (16,543) | |
Operating segments | Elfa | |||||
Segment reporting | |||||
Total Adjusted EBITDA | (471) | 11,186 | 9,157 | 16,073 | |
Depreciation and amortization | (466) | (5,552) | (5,463) | (6,066) | |
Interest expense, net | (18) | (284) | (326) | (562) | |
lntersegment | |||||
Segment reporting | |||||
Total Adjusted EBITDA | $ 639 | $ 105 | $ 175 | $ 48 |
Segment reporting - Sales by me
Segment reporting - Sales by merchandise category as a percentage of total net sales (Details) | 12 Months Ended | ||
Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Sales by merchandise category as a percentage of total net sales | |||
Merchandise category as a percentage of total net sales | 100.00% | 100.00% | 100.00% |
Net sales | Sales by merchandise category | Custom Closets | |||
Sales by merchandise category as a percentage of total net sales | |||
Merchandise category as a percentage of total net sales | 48.00% | 46.00% | 47.00% |
Net sales | Sales by merchandise category | Storage, Box, Shelving | |||
Sales by merchandise category as a percentage of total net sales | |||
Merchandise category as a percentage of total net sales | 14.00% | 14.00% | 14.00% |
Net sales | Sales by merchandise category | Kitchen and Trash | |||
Sales by merchandise category as a percentage of total net sales | |||
Merchandise category as a percentage of total net sales | 13.00% | 13.00% | 13.00% |
Net sales | Sales by merchandise category | Office, Collections, & Hooks | |||
Sales by merchandise category as a percentage of total net sales | |||
Merchandise category as a percentage of total net sales | 8.00% | 9.00% | 9.00% |
Net sales | Sales by merchandise category | Bath, Travel, Laundry | |||
Sales by merchandise category as a percentage of total net sales | |||
Merchandise category as a percentage of total net sales | 8.00% | 9.00% | 9.00% |
Net sales | Sales by merchandise category | Containers, Gift Packaging, Seasonal, Impulse | |||
Sales by merchandise category as a percentage of total net sales | |||
Merchandise category as a percentage of total net sales | 8.00% | 8.00% | 8.00% |
Net sales | Sales by merchandise category | Other | |||
Sales by merchandise category as a percentage of total net sales | |||
Merchandise category as a percentage of total net sales | 1.00% | 1.00% | 0.00% |
Net income per common share (De
Net income per common share (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||
Apr. 02, 2016 | Apr. 04, 2015 | Apr. 01, 2017 | Dec. 31, 2016 | Oct. 01, 2016 | Jul. 02, 2016 | Apr. 02, 2016 | Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Numerator: | |||||||||||||
Net income | $ 354 | $ 638 | $ 8,377 | $ 5,092 | $ 3,541 | $ (2,057) | $ 3,380 | $ 3,924 | $ 3,342 | $ (5,788) | $ 14,953 | $ 5,142 | $ 22,673 |
Denominator: | |||||||||||||
Weighted-average common shares - basic (in shares) | 47,986,975 | 48,009,029 | 47,999,535 | 47,991,445 | 47,986,975 | 47,986,975 | 47,986,975 | 47,986,401 | 47,983,785 | 47,996,746 | 47,985,717 | 47,971,243 | |
Options and other dilutive securities | $ 19,264 | $ 549,622 | |||||||||||
Weighted-average common shares - diluted (in shares) | 47,986,975 | 48,073,420 | 48,022,499 | 48,001,112 | 47,986,975 | 47,986,975 | 47,986,975 | 47,986,972 | 47,983,785 | 48,016,010 | 47,985,717 | 48,520,865 | |
Net income per common share - basic and diluted (in dollars per shares) | $ 0.01 | $ 0.17 | $ 0.11 | $ 0.07 | $ (0.04) | $ 0.07 | $ 0.08 | $ 0.07 | $ (0.12) | $ 0.31 | $ 0.11 | $ 0.47 | |
Stock options | |||||||||||||
Antidilutive securities not included: | |||||||||||||
Antidilutive securities | 2,886,138 | 2,954,114 | 2,875,900 | 830,740 | |||||||||
Nonvested restricted Stock | |||||||||||||
Antidilutive securities not included: | |||||||||||||
Antidilutive securities | 131,957 |
Quarterly results of operatio84
Quarterly results of operations (unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||
Apr. 02, 2016 | Apr. 04, 2015 | Apr. 01, 2017 | Dec. 31, 2016 | Oct. 01, 2016 | Jul. 02, 2016 | Apr. 02, 2016 | Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Quarterly results of operations | |||||||||||||
Net sales | $ 69,218 | $ 66,761 | $ 221,042 | $ 216,380 | $ 205,060 | $ 177,448 | $ 209,881 | $ 212,836 | $ 204,412 | $ 169,958 | $ 819,930 | $ 794,630 | $ 781,866 |
Gross profit | 40,195 | 39,254 | 127,318 | 125,702 | 118,355 | 104,695 | 121,275 | 125,434 | 118,273 | 99,511 | 476,070 | 463,551 | 458,066 |
Income (loss) from operations | 2,242 | 2,565 | 17,181 | 12,561 | 10,272 | 1,028 | 9,452 | 10,156 | 9,910 | (4,981) | 41,042 | 24,861 | 46,971 |
Net income (loss) | $ 354 | $ 638 | $ 8,377 | $ 5,092 | $ 3,541 | $ (2,057) | $ 3,380 | $ 3,924 | $ 3,342 | $ (5,788) | $ 14,953 | $ 5,142 | $ 22,673 |
Weighted-average shares used in computing basic net income (loss) per share (in shares) | 47,986,975 | 48,009,029 | 47,999,535 | 47,991,445 | 47,986,975 | 47,986,975 | 47,986,975 | 47,986,401 | 47,983,785 | 47,996,746 | 47,985,717 | 47,971,243 | |
Weighted-average shares used in computing diluted net income (loss) per share (in Shares) | 47,986,975 | 48,073,420 | 48,022,499 | 48,001,112 | 47,986,975 | 47,986,975 | 47,986,975 | 47,986,972 | 47,983,785 | 48,016,010 | 47,985,717 | 48,520,865 | |
Basic and diluted net income (loss) per common share (in dollars per share) | $ 0.01 | $ 0.17 | $ 0.11 | $ 0.07 | $ (0.04) | $ 0.07 | $ 0.08 | $ 0.07 | $ (0.12) | $ 0.31 | $ 0.11 | $ 0.47 |
Transition Period Financial I85
Transition Period Financial Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||
Apr. 02, 2016 | Apr. 04, 2015 | Apr. 01, 2017 | Dec. 31, 2016 | Oct. 01, 2016 | Jul. 02, 2016 | Apr. 02, 2016 | Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Consolidated statement of operations data: | |||||||||||||
Net sales | $ 69,218 | $ 66,761 | $ 221,042 | $ 216,380 | $ 205,060 | $ 177,448 | $ 209,881 | $ 212,836 | $ 204,412 | $ 169,958 | $ 819,930 | $ 794,630 | $ 781,866 |
Gross Profit | 40,195 | 39,254 | 127,318 | 125,702 | 118,355 | 104,695 | 121,275 | 125,434 | 118,273 | 99,511 | 476,070 | 463,551 | 458,066 |
Selling, general, and administrative expenses | 34,504 | 33,728 | 387,948 | 393,810 | 372,867 | ||||||||
Income from operations | 2,242 | 2,565 | 17,181 | 12,561 | 10,272 | 1,028 | 9,452 | 10,156 | 9,910 | (4,981) | 41,042 | 24,861 | 46,971 |
Income before taxes | 692 | 978 | 24,355 | 8,051 | 29,866 | ||||||||
Provision for income taxes | 338 | 340 | 9,402 | 2,909 | 7,193 | ||||||||
Net income | $ 354 | $ 638 | $ 8,377 | $ 5,092 | $ 3,541 | $ (2,057) | $ 3,380 | $ 3,924 | $ 3,342 | $ (5,788) | $ 14,953 | $ 5,142 | $ 22,673 |
Net income per common share: | |||||||||||||
Basic and diluted (in dollars per share) | $ 0.01 | $ 0.01 | |||||||||||
Weighted-average common shares - basic and diluted (in shares) | 47,986,975 | 47,983,681 |
Subsequent Event (Details)
Subsequent Event (Details) $ in Thousands | 3 Months Ended |
Jul. 01, 2017USD ($) | |
Optimization Plan | Forecast | Subsequent event | |
Subsequent Event | |
Severance expense | $ 2,000 |
Schedule I-Condensed Financia87
Schedule I-Condensed Financial Information of registrant - Condensed balance sheets (Details) - USD ($) $ in Thousands | Apr. 01, 2017 | Apr. 02, 2016 | Feb. 27, 2016 | Feb. 28, 2015 | Mar. 01, 2014 |
Current assets: | |||||
Accounts receivable from subsidiaries | $ 27,476 | $ 28,843 | |||
Total current assets | 162,685 | 146,431 | |||
Noncurrent assets: | |||||
Total noncurrent assets | 599,149 | 611,688 | |||
Total assets | 761,834 | 758,119 | |||
Current liabilities: | |||||
Accounts payable to subsidiaries | 44,762 | 40,274 | |||
Total current liabilities | 113,052 | 116,003 | |||
Noncurrent liabilities | 426,992 | 435,048 | |||
Total liabilities | 540,044 | 551,051 | |||
Shareholders' equity: | |||||
Common stock | 480 | 480 | |||
Additional paid-in capital | 859,102 | 856,879 | |||
Retained deficit | (615,149) | (630,456) | |||
Total shareholders' equity | 221,790 | $ 211,568 | 207,068 | $ 201,862 | $ 197,186 |
Total liabilities and shareholders' equity | 761,834 | 758,119 | |||
The Container Store Group, Inc. | |||||
Current assets: | |||||
Accounts receivable from subsidiaries | 985 | 850 | |||
Total current assets | 985 | 850 | |||
Noncurrent assets: | |||||
Investment in subsidiaries | 220,805 | 206,218 | |||
Total noncurrent assets | 220,805 | 206,218 | |||
Total assets | 221,790 | 207,068 | |||
Shareholders' equity: | |||||
Common stock | 480 | 480 | |||
Additional paid-in capital | 859,102 | 856,879 | |||
Retained deficit | (637,792) | (650,291) | |||
Total shareholders' equity | 221,790 | 207,068 | |||
Total liabilities and shareholders' equity | $ 221,790 | $ 207,068 |
Schedule I-Condensed Financia88
Schedule I-Condensed Financial Information of registrant - Condensed statements of operations (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||
Apr. 02, 2016 | Apr. 04, 2015 | Apr. 01, 2017 | Dec. 31, 2016 | Oct. 01, 2016 | Jul. 02, 2016 | Apr. 02, 2016 | Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Condensed statements of operations | |||||||||||||
Net sales | $ 69,218 | $ 66,761 | $ 221,042 | $ 216,380 | $ 205,060 | $ 177,448 | $ 209,881 | $ 212,836 | $ 204,412 | $ 169,958 | $ 819,930 | $ 794,630 | $ 781,866 |
Cost of sales (excluding depreciation and amortization) | 29,023 | 343,860 | 331,079 | 323,800 | |||||||||
Gross profit | 40,195 | 39,254 | 127,318 | 125,702 | 118,355 | 104,695 | 121,275 | 125,434 | 118,273 | 99,511 | 476,070 | 463,551 | 458,066 |
Selling, general, and administrative expenses (excluding depreciation and amortization) | 34,504 | 33,728 | 387,948 | 393,810 | 372,867 | ||||||||
Stock-based compensation | 147 | 1,989 | 1,556 | 1,289 | |||||||||
Pre-opening costs | 191 | 6,852 | 9,033 | 8,283 | |||||||||
Depreciation and amortization | 3,009 | 37,124 | 34,230 | 31,011 | |||||||||
Other expenses | 102 | 1,058 | 1,132 | ||||||||||
Loss (gain) on disposal of assets | 57 | 61 | (3,487) | ||||||||||
Income from operations | 2,242 | 2,565 | 17,181 | 12,561 | 10,272 | 1,028 | 9,452 | 10,156 | 9,910 | (4,981) | 41,042 | 24,861 | 46,971 |
Interest expense | 1,550 | 16,687 | 16,810 | 17,105 | |||||||||
Income before taxes and equity in net income of subsidiaries | 692 | 978 | 24,355 | 8,051 | 29,866 | ||||||||
Provision for income taxes | 338 | 340 | 9,402 | 2,909 | 7,193 | ||||||||
Net income | 354 | $ 638 | $ 8,377 | $ 5,092 | $ 3,541 | $ (2,057) | $ 3,380 | $ 3,924 | $ 3,342 | $ (5,788) | 14,953 | 5,142 | 22,673 |
The Container Store Group, Inc. | |||||||||||||
Condensed statements of operations | |||||||||||||
Net income of subsidiaries | 354 | 14,953 | 5,142 | 22,673 | |||||||||
Net income | $ 354 | $ 14,953 | $ 5,142 | $ 22,673 |
Schedule I-Condensed Financia89
Schedule I-Condensed Financial Information of registrant - Condensed statements of comprehensive income (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||
Apr. 02, 2016 | Apr. 04, 2015 | Apr. 01, 2017 | Dec. 31, 2016 | Oct. 01, 2016 | Jul. 02, 2016 | Apr. 02, 2016 | Jan. 02, 2016 | Oct. 03, 2015 | Jul. 04, 2015 | Apr. 01, 2017 | Feb. 27, 2016 | Feb. 28, 2015 | |
Condensed statements of comprehensive income | |||||||||||||
Net income | $ 354 | $ 638 | $ 8,377 | $ 5,092 | $ 3,541 | $ (2,057) | $ 3,380 | $ 3,924 | $ 3,342 | $ (5,788) | $ 14,953 | $ 5,142 | $ 22,673 |
Unrealized (loss) gain on financial instruments, net of tax (benefit) provision of $(85), $606, $(604) and $7 | 12 | (138) | 853 | (935) | |||||||||
Unrealized (gain) loss on financial instruments, taxes | 7 | (85) | 606 | (604) | |||||||||
Pension liability adjustment, net of tax provision (benefit) of $142, $39, $(4) and $0 | (66) | (386) | 175 | (14) | |||||||||
Pension liability adjustment, taxes | 0 | 142 | 39 | (4) | |||||||||
Foreign currency translation adjustment | 4,053 | (6,283) | (2,521) | (19,076) | |||||||||
Comprehensive income | 4,353 | 8,146 | 3,649 | 2,648 | |||||||||
The Container Store Group, Inc. | |||||||||||||
Condensed statements of comprehensive income | |||||||||||||
Net income | 354 | 14,953 | 5,142 | 22,673 | |||||||||
Unrealized (loss) gain on financial instruments, net of tax (benefit) provision of $(85), $606, $(604) and $7 | 12 | (138) | 853 | (935) | |||||||||
Unrealized (gain) loss on financial instruments, taxes | 7 | (85) | 606 | (604) | |||||||||
Pension liability adjustment, net of tax provision (benefit) of $142, $39, $(4) and $0 | (66) | (386) | 175 | (14) | |||||||||
Pension liability adjustment, taxes | 0 | 142 | 39 | (4) | |||||||||
Foreign currency translation adjustment | 4,053 | (6,283) | (2,521) | (19,076) | |||||||||
Comprehensive income | $ 4,353 | $ 8,146 | $ 3,649 | $ 2,648 |
Schedule I-Condensed Financia90
Schedule I-Condensed Financial Information of registrant - Disclosure (Details) $ in Thousands | 12 Months Ended | ||
Apr. 01, 2017USD ($) | Feb. 27, 2016USD ($) | Apr. 06, 2012USD ($) | |
Guarantees and restrictions | |||
Long-term debt outstanding | $ 321,138 | $ 327,878 | |
Restricted net assets of consolidated subsidiaries | 209,290 | ||
Revolving credit facility | |||
Guarantees and restrictions | |||
Available credit | $ 73,189 | ||
Borrowings through the Revolving Credit Facility | $ 100,000 | ||
Minimum | Revolving credit facility | |||
Guarantees and restrictions | |||
Threshold fixed charge coverage ratio for payment of dividend | 1.25 | ||
Maximum | Revolving credit facility | |||
Guarantees and restrictions | |||
Amount of dividend payable during term of debt | $ 10,000 | ||
Senior secured term loan facility | |||
Guarantees and restrictions | |||
Long-term debt outstanding | $ 316,760 | $ 321,288 | |
Senior secured term loan facility | Maximum | |||
Guarantees and restrictions | |||
Threshold consolidated net leverage ratio for payment of dividend | 2 | ||
Amount of dividend payable during term of debt | $ 10,000 | ||
The Container Store Group, Inc. | |||
Guarantees and restrictions | |||
Restricted net assets of consolidated subsidiaries | 209,290 | ||
The Container Store Group, Inc. | Revolving credit facility | |||
Guarantees and restrictions | |||
Available credit | 73,189 | ||
Borrowings through the Revolving Credit Facility | 100,000 | ||
The Container Store Group, Inc. | Minimum | Revolving credit facility | |||
Guarantees and restrictions | |||
Threshold fixed charge coverage ratio for payment of dividend | 1.25 | ||
The Container Store Group, Inc. | Maximum | Revolving credit facility | |||
Guarantees and restrictions | |||
Amount of dividend payable during term of debt | 10,000 | ||
The Container Store Group, Inc. | Senior secured term loan facility | |||
Guarantees and restrictions | |||
Long-term debt outstanding | $ 316,760 | ||
The Container Store Group, Inc. | Senior secured term loan facility | Maximum | |||
Guarantees and restrictions | |||
Threshold consolidated net leverage ratio for payment of dividend | 2 |