Document And Entity Information
Document And Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Jul. 25, 2015 | Sep. 11, 2015 | Jan. 24, 2015 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Jul. 25, 2015 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | Yes | ||
Trading Symbol | asna | ||
Entity Registrant Name | Ascena Retail Group, Inc. | ||
Entity Central Index Key | 1,498,301 | ||
Current Fiscal Year End Date | --07-25 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 195,099,353 | ||
Entity Public Float | $ 1.8 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Jul. 25, 2015 | Jul. 26, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 240.6 | $ 156.9 |
Inventories | 489.3 | 553.2 |
Deferred tax assets | 88.5 | 46.7 |
Prepaid expenses and other current assets | 131.5 | 166.8 |
Total current assets | 949.9 | 923.6 |
Property and equipment, net | 1,170 | 1,110.6 |
Goodwill | 319.7 | 581.4 |
Other intangible assets, net | 388.3 | 435.4 |
Other assets | 87.8 | 72.8 |
Total assets | 2,915.7 | 3,123.8 |
Current liabilities: | ||
Accounts payable | 238.8 | 253.2 |
Accrued expenses and other current liabilities | 403.2 | 308.9 |
Deferred income | 64.1 | 63.5 |
Income taxes payable | 11.6 | 6.3 |
Total current liabilities | 717.7 | 631.9 |
Long-term debt | 116 | 172 |
Lease-related liabilities | 241.4 | 248.5 |
Deferred income taxes | 181.8 | 147.7 |
Other non-current liabilities | 140.7 | 186 |
Total liabilities | $ 1,397.6 | $ 1,386.1 |
Commitments and contingencies | ||
Equity: | ||
Common stock, par value $0.01 per share; 163.2 and 161.8 million shares issued and outstanding | $ 1.6 | $ 1.6 |
Additional paid-in capital | 669.8 | 642.2 |
Retained earnings | 859.3 | 1,096.1 |
Accumulated other comprehensive loss | (12.6) | (2.2) |
Total equity | 1,518.1 | 1,737.7 |
Total liabilities and equity | $ 2,915.7 | $ 3,123.8 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Millions | Jul. 25, 2015 | Jul. 26, 2014 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, issued (shares) | 163.2 | 161.8 |
Common stock, outstanding (shares) | 163.2 | 161.8 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |||
Income Statement [Abstract] | |||||
Net sales | $ 4,802.9 | $ 4,790.6 | $ 4,714.9 | ||
Cost of goods sold | (2,133.7) | (2,130.6) | (2,137.7) | ||
Gross margin | 2,669.2 | 2,660 | 2,577.2 | ||
Other operating expenses: | |||||
Buying, distribution and occupancy expenses | (856.9) | (832.3) | (770.5) | ||
Selling, general and administrative expenses | (1,490.9) | (1,376.3) | (1,330.8) | ||
Acquisition and integration expenses | (31.7) | (34) | (34.6) | ||
Impairment of goodwill | 261.7 | [1] | 0 | 0 | |
Impairment of intangible assets | (44.7) | (13) | 0 | ||
Depreciation and amortization expense | (218.2) | (193.6) | (176) | ||
Total other operating expenses | (2,904.1) | (2,449.2) | (2,311.9) | ||
Operating (loss) income | (234.9) | 210.8 | 265.3 | ||
Interest expense | (6) | (6.5) | (13.8) | ||
Interest income and other income (expense), net | 0.3 | (0.8) | 0.4 | ||
Loss on extinguishment of debt | 0 | 0 | (9.3) | ||
(Loss) income from continuing operations before provision for income taxes | (240.6) | 203.5 | 242.6 | ||
Benefit (provision) for income taxes from continuing operations | 3.8 | (65.3) | (87.4) | ||
(Loss) income from continuing operations | (236.8) | 138.2 | 155.2 | ||
Loss from discontinued operations, net of taxes (a) | [2] | 0 | (4.8) | (3.9) | |
Net (loss) income | $ (236.8) | $ 133.4 | $ 151.3 | ||
Net (loss) income per common share - basic: | |||||
Continuing operations | $ (1.46) | $ 0.86 | $ 0.99 | ||
Discontinued operations | 0 | (0.03) | (0.03) | ||
Total net (loss) income per basic common share | (1.46) | 0.83 | 0.96 | ||
Net (loss) income per common share – diluted: | |||||
Continuing operations | (1.46) | 0.84 | 0.95 | ||
Discontinued operations | 0 | (0.03) | (0.02) | ||
Total net (loss) income per diluted common share | $ (1.46) | $ 0.81 | $ 0.93 | ||
Weighted average common shares outstanding: | |||||
Basic (shares) | 162.6 | [3] | 160.6 | 157.3 | |
Diluted (shares) | 162.6 | [3] | 165.1 | 163.3 | |
[1] | Represents accumulated impairment losses as of July 25, 2015. | ||||
[2] | Loss from discontinued operations is presented net of a $3.3 million income tax benefit for both of the years ended July 26, 2014 and July 27, 2013. | ||||
[3] | There was no dilutive effect of stock options, restricted stock and restricted stock units in Fiscal 2015 as the impact of these items was anti-dilutive because of the Company's net loss incurred during the year. |
CONSOLIDATED STATEMENTS OF OPE5
CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | |
Jul. 26, 2014 | Jul. 27, 2013 | |
Income Statement [Abstract] | ||
Loss from discontinued operations, income tax benefit | $ 3.3 | $ 3.3 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Statement of Comprehensive Income [Abstract] | |||
Net (loss) income | $ (236.8) | $ 133.4 | $ 151.3 |
Other comprehensive (loss) income, net of tax: | |||
Net change in unrealized gains on available-for-sale investments | 0 | 0 | 1.2 |
Foreign currency translation adjustment | (10.4) | (1) | (1.1) |
Total other comprehensive (loss) income | (10.4) | (1) | 0.1 |
Total comprehensive (loss) income | $ (247.2) | $ 132.4 | $ 151.4 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |||
Cash flows from operating activities: | |||||
Net (loss) income | $ (236.8) | $ 133.4 | $ 151.3 | ||
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | |||||
Depreciation and amortization expense | 218.2 | 193.6 | 176 | ||
Deferred income tax benefit | (6.6) | (17.8) | (7.9) | ||
Deferred rent and other occupancy costs | (39.1) | (38.2) | (36.2) | ||
Loss on extinguishment of debt | 0 | 0 | 9.3 | ||
Gain on sale of assets | (1.6) | 0 | 0 | ||
Non-cash stock-based compensation expense | 18.2 | 30.6 | 29.5 | ||
Non-cash impairment of tangible assets | 10.8 | 4.2 | 4.6 | ||
Non-cash impairment of goodwill | 261.7 | [1] | 0 | 0 | |
Non-cash impairment of intangible assets | 44.7 | 13 | 0 | ||
Non-cash interest expense, net | 0.9 | 1.3 | 1.7 | ||
Other non-cash income, net | (2.4) | (2.7) | (5.7) | ||
Excess tax benefits from stock-based compensation | 0 | (4.2) | (14.1) | ||
Changes in operating assets and liabilities: | |||||
Inventories | 63.9 | (12.3) | (10.1) | ||
Accounts payable, accrued liabilities and income tax liabilities | 54.2 | 32.8 | 67.6 | ||
Deferred income | 7.7 | 10 | 25.4 | ||
Lease-related liabilities | 32.6 | 46.2 | 39.5 | ||
Other balance sheet changes, net | 4.9 | 5 | 11.5 | ||
Changes in net assets related to discontinued operations | 0 | (20.2) | 7.6 | ||
Net cash provided by operating activities | 431.3 | 374.7 | 450 | ||
Cash flows from investing activities: | |||||
Capital expenditures | [2] | (312.5) | (477.5) | (290.9) | |
Proceeds from the sale of assets | 8.9 | 42.2 | 15.9 | ||
Purchases of investments | (22.3) | (27.5) | (2.8) | ||
Proceeds from sales and maturities of investments | 27.8 | 0.1 | 5.6 | ||
Net cash used in investing activities | (298.1) | (462.7) | (272.2) | ||
Cash flows from financing activities: | |||||
Proceeds from borrowings | 832.3 | 1,249.2 | 446.7 | ||
Repayments of debt | (888.3) | (1,212.8) | (641.4) | ||
Payment of deferred financing costs | (2.2) | 0 | (3.8) | ||
Proceeds from stock options exercised and employee stock purchases | 8.7 | 17.9 | 28.7 | ||
Excess tax benefits from stock-based compensation | 0 | 4.2 | 14.1 | ||
Net cash (used in) provided by financing activities | (49.5) | 58.5 | (155.7) | ||
Net increase (decrease) in cash and cash equivalents | 83.7 | (29.5) | 22.1 | ||
Cash and cash equivalents at beginning of period | 156.9 | 186.4 | 164.3 | ||
Cash and cash equivalents at end of period | $ 240.6 | $ 156.9 | $ 186.4 | ||
[1] | Represents accumulated impairment losses as of July 25, 2015. | ||||
[2] | Excludes ending accrued capital expenditures of $50.8 million in Fiscal 2015, $64.4 million in Fiscal 2014 and $58.9 million in Fiscal 2013. |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) shares in Millions, $ in Millions | Total | Common Stock | Additional Paid-In Capital | Retained Earnings | AOCI | [1] | |
Common Stock, Shares, Beginning Balance (shares) at Jul. 28, 2012 | 154.8 | ||||||
Common Stock, Amount, Beginning Balance at Jul. 28, 2012 | $ 1,340.9 | $ 1.5 | $ 528.8 | $ 811.9 | $ (1.3) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | 151.3 | 151.3 | |||||
Total other comprehensive income (loss) | 0.1 | 0.1 | |||||
Cash-settled LTIP conversion | [2] | (6.9) | (6.9) | ||||
Shares issued and equity grants made pursuant to stock-based compensation plans (shares) | [3] | 4.7 | |||||
Shares issued and equity grants made pursuant to stock-based compensation plans | [3] | 71 | $ 0.1 | 70.9 | |||
Common Stock, Shares, Ending Balance (shares) at Jul. 27, 2013 | 159.5 | ||||||
Common Stock, Amount, Ending Balance at Jul. 27, 2013 | 1,556.4 | $ 1.6 | 592.8 | 963.2 | (1.2) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | 133.4 | 133.4 | |||||
Total other comprehensive income (loss) | (1) | (1) | |||||
Shares issued and equity grants made pursuant to stock-based compensation plans (shares) | [3] | 2.3 | |||||
Shares issued and equity grants made pursuant to stock-based compensation plans | [3] | 49.4 | 49.4 | ||||
Other | $ (0.5) | (0.5) | |||||
Common Stock, Shares, Ending Balance (shares) at Jul. 26, 2014 | 161.8 | 161.8 | |||||
Common Stock, Amount, Ending Balance at Jul. 26, 2014 | $ 1,737.7 | $ 1.6 | 642.2 | 1,096.1 | (2.2) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | (236.8) | (236.8) | |||||
Total other comprehensive income (loss) | (10.4) | (10.4) | |||||
Shares issued and equity grants made pursuant to stock-based compensation plans (shares) | [3] | 1.4 | |||||
Shares issued and equity grants made pursuant to stock-based compensation plans | [3] | $ 27.6 | 27.6 | ||||
Common Stock, Shares, Ending Balance (shares) at Jul. 25, 2015 | 163.2 | 163.2 | |||||
Common Stock, Amount, Ending Balance at Jul. 25, 2015 | $ 1,518.1 | $ 1.6 | $ 669.8 | $ 859.3 | $ (12.6) | ||
[1] | Accumulated other comprehensive loss (“AOCI”) consists of foreign currency translation adjustments and net unrealized gains on available-for-sale securities. | ||||||
[2] | Approximately 0.6 million of performance and market-based shares were canceled and replaced with a corresponding amount of new awards that will be settled in cash with the underlying value reclassified to liabilities. | ||||||
[3] | Includes excess tax benefits of approximately $(1.2) million in Fiscal 2015, $4.2 million in Fiscal 2014 and $14.1 million in Fiscal 2013 resulting from stock-based compensation arrangements. |
CONSOLIDATED STATEMENTS OF EQU9
CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - USD ($) shares in Millions, $ in Millions | 12 Months Ended |
Jul. 27, 2013 | |
Excess tax benefit | $ 14.1 |
Cash Settled LTIP Awards | |
Awards canceled in exchange for grants of new awards | 0.6 |
Description of Business
Description of Business | 12 Months Ended |
Jul. 25, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business Ascena Retail Group, Inc., a Delaware corporation (“ascena” or the “Company”), is a leading national specialty retailer of apparel for women and tween girls. The Company operates, through its 100% owned subsidiaries, the following principal retail brands: Justice , Lane Bryant , maurices , dressbarn and Catherines . The Company operations include ecommerce operations and approximately 3,900 stores throughout the United States and Canada, with annual revenues of approximately $4.8 billion for the fiscal year ended July 25, 2015. The Company and its subsidiaries are collectively referred to herein as the “we,” “us,” “our” and “ourselves,” unless the context indicates otherwise. The Company classifies its businesses into five segments following a brand-oriented approach: Justice , Lane Bryant , maurices , dressbarn and Catherines . The Justice segment includes 978 specialty retail and outlet stores, ecommerce operations and certain licensed franchises in international territories. The Justice brand offers fashionable apparel to girls who are ages 5 to 12 in an environment designed to match the energetic lifestyle of tween girls. The Lane Bryant segment includes 765 specialty retail and outlet stores and ecommerce operations. The Lane Bryant brand offers fashionable and sophisticated plus-size apparel under multiple private labels, such as Lane Bryant and Cacique , to female customers in the 25 to 45 age range. The maurices segment includes 951 specialty retail and outlet stores and ecommerce operations. The maurices brand offers up-to-date fashion designed to appeal to female customers customers in their 20's and 30's, including both core and plus-size offering, with stores concentrated in small markets (approximately 25,000 to 150,000 people). The dressbarn segment includes 824 specialty retail and outlet stores and ecommerce operations. The dressbarn brand primarily attracts female consumers in the mid-30’s to mid-50’s age range and offers moderate-to-better quality career, special occasion and casual fashion for working women. The Catherines segment includes 377 specialty retail stores and ecommerce operations. The Catherines brand offers classic apparel and accessories for wear-to-work and casual lifestyles in a full range of plus sizes, generally catering to the female customer 45 years and older. |
Basis of Presentation
Basis of Presentation | 12 Months Ended |
Jul. 25, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Basis of Consolidation The consolidated financial statements are prepared in accordance with United States Generally Accepted Accounting Principles (“US GAAP”), and present the financial position, operational results, comprehensive (loss) income and cash flows of the Company and its subsidiaries which are 100% owned. All significant intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and footnotes thereto. Actual results could differ materially from those estimates. Significant estimates inherent in the preparation of the consolidated financial statements include: the realizability of inventory; reserves for litigation and other contingencies; useful lives and impairments of long-lived tangible assets, goodwill and other intangible assets; accounting for income taxes and related uncertain tax positions; the valuation of stock-based compensation and related expected forfeiture rates; and its self-insured insurance reserves. Fiscal Year The Company utilizes a 52-53 week fiscal year ending on the last Saturday in July. As such, fiscal year 2015 ended on July 25, 2015 and reflected a 52-week period (“Fiscal 2015"); fiscal year 2014 ended on July 26, 2014 and reflected a 52-week period (“Fiscal 2014"); and fiscal year 2013 ended on July 27, 2013 and reflected a 52-week period (“Fiscal 2013”). Discontinued Operations On June 14, 2012, the Company acquired the Fashion Bug and Figi’s businesses in connection with the acquisition of the Lane Bryant and Catherines businesses. Contemporaneously with the acquisition of those businesses, the Company announced its intent to cease operating the acquired Fashion Bug business. In Fiscal 2013, the Fashion Bug distribution center was sold for net proceeds of approximately $16 million . In addition, contemporaneously with the acquisition of those businesses, the Company also announced its intent to sell the acquired Figi’s business. In August 2013, the Company entered into an agreement to sell the principal net assets of the Figi’s business (the “ Figi’s Sale”) and recorded an $8.0 million pretax charge during the fourth quarter of Fiscal 2013 to reduce the carrying value of the Figi’s net assets to an amount approximating the net sales proceeds. The Figi’s Sale closed during the first quarter of Fiscal 2014 and resulted in additional pretax charges of $4.6 million to reflect transaction costs and the adjustment of certain liabilities which existed at the date it was sold. These charges have been classified as components of discontinued operations in the accompanying consolidated statements of operations. Operating results for those businesses, including $7.4 million of revenues for the first quarter of Fiscal 2014 (only consisting of revenues from the Figi’s business) and $407.6 million of revenue for Fiscal 2013, have been segregated and reported separately in the accompanying consolidated statements of operations. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Jul. 25, 2015 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Revenue Recognition Revenue is recognized when there is persuasive evidence of an arrangement, delivery has occurred, price has been fixed or is determinable and collectability is reasonably assured. Retail store revenue is recognized net of estimated returns at the time of sale to consumers. Ecommerce revenue from sales of products ordered through the Company’s retail Internet sites and revenue from direct-mail orders through Justice’s catazine are recognized upon delivery and receipt of the shipment by our customers. Such revenue also is reduced by an estimate of returns. Reserves for estimated product returns are recorded based on historical return trends and are adjusted for known events, as applicable. Reserves for estimated product returns were $9.2 million and $7.7 million as of the end of Fiscal 2015 and Fiscal 2014, respectively. Gift cards, gift certificates and merchandise credits (collectively, “gift cards”) issued by the Company are recorded as a deferred income liability until they are redeemed, at which point revenue is recognized. Gift cards do not have expiration dates. The Company recognizes income for unredeemed gift cards when the likelihood of a gift card being redeemed by a customer is remote and the Company determines that it does not have a legal obligation to remit the value of the unredeemed gift card to the relevant jurisdiction as unclaimed or abandoned property. Gift card breakage is included in Net sales in the accompanying consolidated statements of operations and historically has not been material. Revenue associated with merchandise shipments to other third-party retailers is recognized at the time title passes and risk of loss is transferred to customers, which generally occurs at the date of shipment. In addition to retail-store, ecommerce and third party sales, the Justice segment recognizes revenue from (i) licensing arrangements with franchised stores, (ii) advertising and other “tween-right” marketing arrangements with partner companies, (iii) royalty payments received under license agreements for the use of the Justice trade name and (iv) amounts received in connection with advertising and marketing arrangements with partner companies when they are earned in accordance with the terms of the underlying agreements. The Company accounts for sales and other related taxes on a net basis, thereby excluding such taxes from revenue. Cost of Goods Sold Cost of goods sold (“COGS”) consists of all costs of merchandise (net of purchase discounts and vendor allowances), merchandise acquisition costs (primarily commissions and import fees) and freight to our distribution centers and stores. These costs are determined to be directly or indirectly incurred in bringing an article to its existing condition and location. Additionally, the direct costs associated with shipping goods to customers and adjustments to the carrying value of inventory related to realizability and shrinkage are recorded as a component of Cost of goods sold. Our Cost of goods sold and Gross margin may not be comparable to those of other entities. Some entities, like us, exclude costs related to their distribution network, buying function, store occupancy costs and depreciation and amortization expenses from Cost of goods sold and include them in other operating expenses, whereas other entities include these costs in their Cost of goods sold. Buying, Distribution and Occupancy Expenses Buying, distribution and occupancy expenses consist of store occupancy and utility costs (excluding depreciation), fulfillment expense (as defined below) and all costs associated with the buying and distribution functions. Selling, General and Administrative Expenses Selling, general and administrative expenses (“SG&A expenses”) consist of compensation and benefit-related costs for sales and store operations personnel, administrative personnel and other employees not associated with the functions described above under Buying, distribution and occupancy expenses. SG&A expenses also include advertising and marketing costs, information technology and communication costs, supplies for our stores and administrative facilities, insurance costs, legal costs and costs related to other administrative services. Acquisition and Integration Expenses Acquisition and integration expenses consist of transaction expenses representing legal, consulting and investment banking-related costs that are direct, incremental costs incurred prior to the closing of an acquisition and costs incurred to integrate the operations of newly acquired businesses into the Company's existing infrastructure as well as other initiatives to combine the newly merged companies into new infrastructure. Shipping and Fulfillment Shipping and fulfillment fees billed to customers are recorded as revenue. The direct costs associated with shipping goods to customers are recorded as a component of Cost of goods sold. Costs associated with preparing the merchandise for shipping, such as picking, packing, warehousing, and order charges ("fulfillment expense") are recorded as a component of Buying, distribution and occupancy expenses. Fulfillment expense was approximately $37.8 million in Fiscal 2015, $38.0 million in Fiscal 2014 and $33.4 million in Fiscal 2013. Marketing and Advertising Costs Marketing and advertising costs are included in SG&A expenses. Marketing and advertising costs are expensed when the advertisement is first exhibited. Marketing and advertising expenses were $176.7 million for Fiscal 2015, $160.1 million for Fiscal 2014 and $169.1 million for Fiscal 2013. Deferred marketing and advertising costs, which principally relate to advertisements that have not yet been exhibited or services that have not yet been received, were not material at the end of either Fiscal 2015 or Fiscal 2014. Foreign Currency Translation and Transactions The operating results and financial position of foreign operations are consolidated using the local currency as the functional currency. Local currency assets and liabilities are translated at the rates of exchange on the balance sheet date, and local currency revenues and expenses are translated at average rates of exchange during the period. The resulting translation gains or losses are included in the consolidated statements of comprehensive (loss) income, and in the consolidated statements of equity as a component of accumulated other comprehensive (loss) income (“AOCI”). Gains and losses on the translation of intercompany loans made to foreign subsidiaries that are of a long-term investment nature also are included within AOCI. The Company recognizes gains and losses on transactions that are denominated in a currency other than the respective entity's functional currency. Foreign currency transaction gains and losses also result from intercompany loans made to foreign subsidiaries that are not of a long-term investment nature and include amounts realized on the settlement of certain intercompany loans with foreign subsidiaries. Net losses from foreign currency transactions amounted to $0.9 million in Fiscal 2015 and $1.6 million in Fiscal 2014. Such amounts are recognized in earnings and included as part of Interest income and other income (expense), net in the accompanying consolidated statements of operations. The amount of net foreign currency transaction losses for Fiscal 2013 was de minimis. Stock-Based Compensation The Company expenses stock-based compensation to employees and non-employee directors based on the grant date fair value of the awards over the requisite service period, adjusted for estimated forfeitures. The Company uses the Black-Scholes valuation method to determine the grant date fair value of its option-based compensation. Shares of restricted stock and restricted stock units are issued with either service-based or performance-based conditions, and some also have market-based conditions (collectively, “Restricted Equity Awards”). Compensation expense for both service-based and performance-based Restricted Equity Awards is recognized over the vesting period based on the grant-date fair values of the awards that are expected to vest based upon the service and performance-based conditions. However, compensation expense for market-based Restricted Equity Awards is recognized over the vesting period regardless of whether the market conditions are expected to be achieved. Compensation expense for cash-settled long-term incentive plan awards (the “Cash-Settled LTIP Awards”) is recognized over the related vesting period based on the expected performance of the plan and changes in the Company’s stock price over time. See Note 16 for further discussion of the Company's stock-based compensation plans. Cash and Cash Equivalents Cash and cash equivalents include all highly liquid investments with original maturities of 90 days or less and receivables from financial institutions related to credit card purchases due to the high credit quality and short time frame for settlement of the outstanding amounts. Concentration of Credit Risk The Company maintains cash deposits and cash equivalents with well-known and stable financial institutions; however, there were significant amounts of cash and cash equivalents at these financial institutions in excess of federally insured limits at July 25, 2015. Inventories We hold inventory for sale through our retail stores and ecommerce sites. Inventory is valued using the retail method of accounting and is stated at the lower of cost, on a First In, First Out (“FIFO”) basis, or market. Under the retail inventory method, the valuation of inventory at cost and resulting gross margin are calculated by applying a calculated cost to retail ratio to the retail value of inventory. Inherent in the retail method are certain significant management judgments and estimates including, among others, initial merchandise markup, markdowns and shrinkage, which significantly impact the ending inventory valuation at cost as well as the resulting gross margins. The Company continuously reviews its inventory levels to identify slow-moving merchandise and markdowns necessary to clear slow-moving merchandise, which reduces the cost of inventories to its estimated net realizable value. Consideration is given to a number of quantitative and qualitative factors, including current pricing levels and the anticipated need for subsequent markdowns, aging of inventories, historical sales trends, and the impact of market trends and economic conditions. Estimates of markdown requirements may differ from actual results due to changes in quantity, quality and mix of products in inventory, as well as changes in consumer preferences, market and economic conditions. The Company’s historical estimates of these costs and its markdown provisions have not differed materially from actual results. Reserves for inventory shrinkage, representing the risk of physical loss of inventory, are estimated based on historical experience and are adjusted based upon physical inventory counts. Property and Equipment, Net Property and equipment, net, is stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the following estimated useful lives: Buildings and improvements 10-40 years Distribution center equipment and machinery 3-20 years Leasehold improvements Shorter of the useful life or expected term of the lease Furniture, fixtures, and equipment 2-10 years Information technology 3-10 years Certain costs associated with computer software developed or obtained for internal use are capitalized, including internal costs. The Company capitalizes certain costs for employees that are directly associated with internal use computer software projects once specific criteria are met. Costs are expensed for preliminary stage activities, training, maintenance and all other post-implementation stage activities as they are incurred. Property and equipment, along with other long-lived assets, are evaluated for impairment periodically whenever events or changes in circumstances indicate that their related carrying amounts may not be recoverable. In evaluating long-lived assets for recoverability, including finite-lived intangible assets as described below, the Company uses its best estimate of future cash flows expected to result from the use of the asset and its eventual disposition. To the extent that estimated future undiscounted net cash flows attributable to the asset are less than the carrying amount, an impairment loss is recognized equal to the difference between the carrying value of such asset and its fair value, considering external market participant assumptions. Assets to be disposed of and for which there is a committed plan of disposal are reported at the lower of carrying value or fair value less costs to sell. See Note 7 for additional discussion of the Company’s property and equipment, as well as a discussion of long-lived asset impairments. Goodwill and Other Intangible Assets, Net At acquisition, the Company estimates and records the fair value of purchased intangible assets, which primarily consist of certain trade names, proprietary software and franchise rights. The fair value of these intangible assets is estimated based on management's assessment, considering independent third-party appraisals, when necessary. The excess of the purchase consideration over the fair value of net assets acquired is recorded as goodwill. Goodwill and certain other intangible assets deemed to have indefinite useful lives, including trade names and certain franchise rights, are not amortized. Rather, goodwill and such indefinite-lived intangible assets are assessed for impairment at least annually based on comparisons of their respective fair values to their carrying values. Goodwill impairment is determined using a two-step process. The first step of the goodwill impairment test is to identify potential impairment by comparing the fair value of a reporting unit with its net book value (or carrying amount), including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not to be impaired and performance of the second step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The second step of the goodwill impairment test compares the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit's goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination. That is, the fair value of the reporting unit is allocated to all of the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value was the purchase price paid to acquire the reporting unit. The impairment test for other indefinite-lived intangible assets consists of a comparison of the fair value of the intangible asset with its carrying value. The fair value of indefinite-lived intangible assets is primarily determined using the relief from royalty approach. If the carrying value of the indefinite-lived intangible asset exceeds its fair value, an impairment loss is recognized equal to the excess. In addition, in evaluating finite-lived intangible assets for recoverability, we use our best estimate of future cash flows expected to result from the use of the asset and eventual disposition. To the extent that estimated future undiscounted net cash flows attributable to the asset are less than the carrying amount, an impairment loss is recognized equal to the difference between the carrying value of such asset and its fair value. The Company performs its annual impairment assessment of goodwill and indefinite lived intangible assets using a quantitative approach during the fourth quarter of each fiscal year. During Fiscal 2015, the Company changed the date of its annual impairment assessment from the last day of the second month of its fiscal fourth quarter to the first day of its fiscal fourth quarter. The change in date had no impact on our Fiscal 2015 annual impairment test as both the new and the old testing dates are within the same fiscal quarter. The change in the assessment date was made to allow for more time to perform the annual impairment assessment before the Company's fiscal year-end. See Note 8 for additional discussion of the Company’s goodwill and other intangible assets and a discussion of the results of the annual assessment of goodwill and indefinite-lived intangible assets, including related impairment charges. Finite-lived intangible assets are amortized over their respective estimated useful lives and, along with other long-lived assets (as discussed above), are evaluated for impairment periodically whenever events or changes in circumstances indicate that their related carrying amounts may not be recoverable. Refer to the Company's accounting policy for long-lived asset impairment as described earlier under the caption "Property and Equipment, Net." Insurance Reserves The Company uses a combination of insurance and self-insurance mechanisms to provide for the potential liabilities for workers’ compensation and employee healthcare benefits. Liabilities associated with these risks are estimated, in part, by considering historical claims experience, demographic factors, severity factors and other actuarial assumptions. Such liabilities are capped through the use of stop loss contracts with insurance companies. The estimated accruals for these liabilities could be significantly affected if future occurrences and claims differ from these assumptions and historical trends. As of July 25, 2015 and July 26, 2014, these reserves were $48.5 million and $52.9 million , respectively. The Company is subject to various claims and contingencies related to insurance and other matters arising out of the normal course of business. The Company is self-insured for expenses related to its employee medical and dental plans, and its workers’ compensation plan, up to certain thresholds. Claims filed, as well as claims incurred but not reported, are accrued based on management’s estimates, using information received from plan administrators, historical analysis and other relevant data. The Company’s stop-loss insurance coverage limit for individual claims under these policies is $350,000 . The Company believes its accruals for claims and contingencies are adequate based on information currently available. However, it is possible that actual results could differ significantly from the recorded accruals for claims and contingencies. Income Taxes Income taxes are provided using the asset and liability method. Under this method, income taxes (i.e., deferred tax assets and liabilities, current taxes payable/refunds receivable and tax expense) are recorded based on amounts refundable or payable in the current year, and include the results of any differences between US GAAP and tax reporting. Deferred income taxes reflect the tax effect of certain net operating loss, capital loss and general business credit carry forwards and the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial statement and income tax purposes, as determined under enacted tax laws and rates. The Company accounts for the financial effect of changes in tax laws or rates in the period of enactment. In addition, valuation allowances are established when management determines that it is more-likely-than-not that some portion or all of a deferred tax asset will not be realized. Tax valuation allowances are analyzed periodically and adjusted as events occur, or circumstances change, that warrant adjustments to those balances. In determining the income tax provision for financial reporting purposes, the Company establishes a reserve for uncertain tax positions. If the Company considers that a tax position is “more-likely-than-not” of being sustained upon audit, based solely on the technical merits of the position, it recognizes the tax benefit. The Company measures the tax benefit by determining the largest amount that is greater than 50% likely of being realized upon settlement, presuming that the tax position is examined by the appropriate taxing authority that has full knowledge of all relevant information. These assessments can be complex and the Company often obtains assistance from external advisors. To the extent that the Company’s estimates change or the final tax outcome of these matters is different than the amounts recorded, such differences will impact the income tax provision in the period in which such determinations are made. If the initial assessment fails to result in the recognition of a tax benefit, the Company regularly monitors its position and subsequently recognizes the tax benefit if (i) there are changes in tax law or analogous case law that sufficiently raise the likelihood of prevailing on the technical merits of the position to “more-likely-than-not,” (ii) the statute of limitation expires, or (iii) there is a completion of an audit resulting in a settlement of that tax year with the appropriate agency. Uncertain tax positions are classified as current only when the Company expects to pay cash within the next twelve months. Interest and penalties, if any, are recorded within the provision for income taxes in the Company’s accompanying consolidated statements of operations and are classified on the accompanying consolidated balance sheets with the related liability for uncertain tax positions. See Note 12 for additional discussion of the Company’s income taxes. Leases The Company leases certain facilities and equipment, including its retail stores. Most of the Company's leases contain renewal options, rent escalation clauses and/or landlord incentives. Rent expense for non-cancelable operating leases with scheduled rent increases and/or landlord incentives is recognized on a straight-line basis over the lease term, beginning with the effective lease commencement date. The effective lease commencement date represents the date on which the Company takes possession of, or controls the physical use of, the leased property. The excess of straight-line rent expense over scheduled payment amounts and landlord incentives is recorded as a deferred rent liability and is classified on the consolidated balance sheets within Lease-related liabilities. Certain leases provide for contingent rents, which are determined as a percentage of gross sales in excess of specified levels. A contingent rent liability is recognized together with the corresponding rent expense when specified levels have been achieved or when management determines that achieving the specified levels during the fiscal year is probable. See Note 14 for additional discussion of the Company’s lease commitments. |
Recently Issued Accounting Stan
Recently Issued Accounting Standards | 12 Months Ended |
Jul. 25, 2015 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In May 2014 the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, "Revenue from Contracts with Customers" ("ASU 2014-09"), which supersedes the revenue recognition requirements in FASB Accounting Standards Codification ("ASC") Topic 605, "Revenue Recognition." The guidance requires that an entity recognize revenue in a way that depicts the transfer of promised goods or services to customers in the amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods and services. The guidance, which was deferred in July 2015, will be effective for annual reporting periods beginning after December 15, 2017, and interim periods therein. The guidance may be applied retrospectively to each period presented or with the cumulative effect recognized as of the initial date of application. Early application is not permitted. The Company is currently evaluating the new standard and its impact on the Company's consolidated financial statements. In April 2015, the FASB issued ASU 2015-03, “Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs” (“ASU 2015-03”). The guidance requires debt issuance costs to be presented in the balance sheet as a direct deduction from the carrying value of the debt liability. The recognition and measurement for debt issuance costs are not affected and will continue to be recognized over the life of the debt instrument. The guidance will be effective for fiscal years beginning after December 15, 2015 and interim periods therein. The guidance is to be applied retrospectively, with early application permitted. The Company expects to adopt the guidance in the first quarter of Fiscal 2016. As a result of the retrospective application, debt issuance costs of $9.5 million as of July 25, 2015 and $5.2 million as of July 26, 2014, which are included in Other assets, and debt issuance costs related to the amended credit facility and term loan discussed in Note 19 will be included in Long-term debt. |
Inventories
Inventories | 12 Months Ended |
Jul. 25, 2015 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories substantially consist of finished goods merchandise. Inventory by brand is set forth below: July 25, 2015 July 26, 2014 (millions) Justice $ 136.0 $ 198.6 Lane Bryant 126.5 125.6 maurices 103.8 105.5 dressbarn 93.3 97.1 Catherines 29.7 26.4 Total inventories $ 489.3 $ 553.2 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Jul. 25, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Fair Value Measurements of Financial Instruments Certain financial assets and liabilities are required to be carried at fair value. Fair value is the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. In determining fair value, the Company utilizes market data or assumptions that it believes market participants would use in pricing the asset or liability, which would maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible, including assumptions about risk and the risks inherent in the inputs to the valuation technique. In evaluating the fair value measurement techniques for recording certain financial assets and liabilities, there is a three-level valuation hierarchy under which financial assets and liabilities are designated. The determination of the applicable level within the hierarchy of a particular financial asset or liability depends on the inputs used in valuation as of the measurement date. Valuations based on observable or market-based inputs for identical assets or liabilities (Level 1 measurement) are given the highest level of priority, whereas valuations based on unobservable or internally derived inputs (Level 3 measurement) are given the lowest level of priority. The three levels of the fair value hierarchy are defined as follows: Level 1 Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 Financial instruments lacking unadjusted, quoted prices from active market exchanges, including over-the-counter traded financial instruments. The prices for the financial instruments are determined using prices for recently traded financial instruments with similar underlying terms as well as directly or indirectly observable inputs, such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 Financial instruments that are not actively traded on a market exchange. This category includes situations where there is little, if any, market activity for the financial instrument. The prices are determined using significant unobservable inputs or valuation techniques. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. As of July 25, 2015 the Company’s investments included restricted cash of $13.4 million and as of July 26, 2014 included restricted cash, certificates of deposit and U.S. government securities of $30.4 million . These investments are short-term in nature and are classified within Prepaid expenses and other current assets in the accompanying consolidated balance sheets. Cash and cash equivalents (Level 1 measurements) are recorded at cost, which approximates fair value. Available-for-sale investments are recorded at fair value and consist of restricted cash (Level 1 measurements) in Fiscal 2015 and restricted cash, certificates of deposit and US government securities (all Level 1 measurements) in Fiscal 2014. As the Company’s revolving credit facility is variable rate, there is no significant difference between the estimated fair value (Level 2 measurement) and the carrying value. The Company’s non-financial instruments, which primarily consist of goodwill, intangible assets, and property and equipment, are not required to be measured at fair value on a recurring basis and are reported at their carrying value. However, on a periodic basis whenever events or changes in circumstances indicate that their carrying value may not be recoverable (and at least annually for goodwill and other indefinite-lived intangible assets), non-financial instruments are assessed for impairment and, if applicable, written-down to (and recorded at) fair value. For further discussion of the determination of the fair value of non-financial instruments, see Notes 7 and 8. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Jul. 25, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment, net, consist of the following: July 25, 2015 July 26, 2014 (millions) Property and Equipment: Land $ 30.4 $ 33.1 Buildings and improvements 189.3 177.9 Leasehold improvements 652.7 604.0 Furniture, fixtures and equipment 572.7 545.7 Information technology (a) 356.2 237.3 Construction in progress (a) 148.6 156.8 1,949.9 1,754.8 Less: accumulated depreciation (779.9 ) (644.2 ) Property and equipment, net $ 1,170.0 $ 1,110.6 (a) Investments in our point-of-sale and merchandising systems that were placed in service during Fiscal 2015 are included in Information technology and were included within construction in progress in Fiscal 2014. Investments related to the development of our ecommerce platforms and costs associated with the construction of a new headquarters building for maurices and certain shared services operations in Duluth, MN are included within Construction in process in Fiscal 2015. Long-Lived Asset Impairments The charges below reduced the net carrying value of certain long-lived assets to their estimated fair value, which was determined based on discounted expected cash flows. These impairment charges were primarily related to the lower-than-expected operating performance of certain retail stores. Impairment losses for retail store-related assets and finite-lived intangible assets are included as a component of SG&A expenses in the accompanying consolidated statements of operations for all periods. There were no finite-lived intangible asset impairment losses recorded for any of the periods presented. Fiscal 2015 Impairments During Fiscal 2015, the Company recorded an aggregate of $10.8 million in non-cash impairment charges, including $6.4 million in its Justice segment, $0.6 million in its Lane Bryant segment, $2.6 million in its maurices segment and $1.2 million in its dressbarn segment. There were no impairment charges recorded at the Catherines segment. Fiscal 2014 Impairments During Fiscal 2014, the Company recorded an aggregate of $4.2 million in non-cash impairment charges, including $0.3 million in its Justice segment, $0.9 million in its Lane Bryant segment, $1.1 million in its maurices segment and $1.9 million in its dressbarn segment. There were no impairment charges recorded at the Catherines segment. Fiscal 2013 Impairments During Fiscal 2013, the Company recorded an aggregate of $4.6 million in non-cash impairment charges, including $0.1 million in its Justice segment, $2.0 million in its Lane Bryant segment, $0.7 million in its maurices segment and $1.8 million in its dressbarn segment. There were no impairment charges recorded at the Catherines segment. Depreciation The Company recognized depreciation expense of $215.8 million in Fiscal 2015, $190.9 million in Fiscal 2014 and $173.4 million in Fiscal 2013, which is classified within Depreciation and amortization expense in the accompanying consolidated statements of operations. In Fiscal 2015, the Company closed the Brothers brand, a separate brand operating within our Justice segment, which represented less than 1% of the Company's consolidated revenues for all periods presented. As a result, the depreciable lives of certain existing assets were adjusted to reflect a shortened useful life for the assets as a result of the closure. Thus, Fiscal 2015 included incremental depreciation expense for these assets of approximately $5.9 million which increased the net loss by approximately $3.7 million and diluted net loss per common share by approximately $0.02 . Substantially all of these assets ceased depreciating during Fiscal 2015. As a result of the Company’s integration of its supply chain and technological infrastructure, the depreciable lives of certain existing assets were adjusted to reflect a shortened useful life for the assets that were displaced as a result of these projects. Thus, Fiscal 2014 and Fiscal 2013 include incremental depreciation expenses for these assets of approximately $8.6 million and $14.2 million , respectively. This additional expense reduced income from continuing operations by approximately $5.3 million and $8.9 million for Fiscal 2014 and Fiscal 2013, respectively, and diluted net income per common share from continuing operations by approximately $0.03 and $0.05 for Fiscal 2014 and Fiscal 2013, respectively. Substantially all of these displaced assets ceased depreciating during Fiscal 2014. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Jul. 25, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill The following details the changes in goodwill for each reportable segment: Justice Lane Bryant maurices dressbarn Catherines Total (millions) Balance at July 27, 2013 $ 103.6 $ 319.1 $ 130.7 $ — $ 28.0 $ 581.4 Acquisition-related activity — — — — — — Balance at July 26, 2014 103.6 319.1 130.7 — 28.0 581.4 Impairment losses (a) — (261.7 ) — — — (261.7 ) Balance at July 25, 2015 $ 103.6 $ 57.4 $ 130.7 $ — $ 28.0 $ 319.7 (a) Represents accumulated impairment losses as of July 25, 2015. Other Intangible Assets Other intangible assets consist of the following: July 25, 2015 July 26, 2014 Description Gross Carrying Amount Accumulated Amortization Net Gross Carrying Amount Accumulated Amortization Net Intangible assets subject to amortization : (millions) Proprietary technology $ 5.8 $ (5.8 ) $ — $ 6.5 $ (5.7 ) $ 0.8 Customer relationships 2.7 (2.7 ) — 2.7 (2.6 ) 0.1 Trade names 5.3 (5.3 ) — 5.3 (3.8 ) 1.5 Total intangible assets subject to amortization 13.8 (13.8 ) — 14.5 (12.1 ) 2.4 Intangible assets not subject to amortization : Brands and trade names (a) 377.4 — 377.4 422.1 — 422.1 Franchise rights 10.9 — 10.9 10.9 — 10.9 Total intangible assets not subject to amortization 388.3 — 388.3 433.0 — 433.0 Total intangible assets $ 402.1 $ (13.8 ) $ 388.3 $ 447.5 $ (12.1 ) $ 435.4 (a) The decrease is due to the impairment loss of $44.7 million recognized for the Lane Bryant trade name in Fiscal 2015. Amortization The Company recognized amortization expense on other intangible assets of $2.4 million in Fiscal 2015, $2.7 million in Fiscal 2014 and $2.6 million in Fiscal 2013, which is classified within Depreciation and amortization expense in the accompanying consolidated statements of operations. The intangible assets subject to amortization were fully amortized as of July 25, 2015. Goodwill and Other Indefinite-lived Intangible Assets Impairment Assessment Fiscal 2015 Annual Impairment Assessment The Company performed its annual impairment assessment of goodwill during the fourth quarter of Fiscal 2015 (the "Fiscal 2015 Valuation"). The Fiscal 2015 Valuation was determined with the assistance of an independent valuation firm using two valuation approaches, including the income approach (discounted cash flow method ("DCF")) and market approach (guideline public company method and guideline transaction method). The Company believes that the income approach (Level 3 measurement) is the most reliable indication of value as it captures forecasted revenues and earnings for the reporting units in the projection period that the market approach may not directly incorporate. Therefore, a greater weighting was applied to the income approach than the market approach. The weighing of the fair values by valuation approach (income approach vs. market approach) were consistent across all reporting units and all periods, with certain variations on the relative weighting between the guideline public company method and guideline transaction method. For all reporting units the income approach was weighted 75% and the market approach 25% . Under the market approach, the Company estimated a fair value based on comparable companies' market multiples of revenues and earnings before interest, taxes, depreciation and amortization and factored in a control premium and used the market approach as a comparison of respective fair values. In each case, the estimated fair value determined under the market approach validated our estimate of fair value determined under the income approach. Finally, the Company’s publicly traded market capitalization was reconciled to the sum of the fair value of the reporting units. Based on the results of the impairment assessment, other than the Lane Bryant reporting unit as discussed below, the fair value of each reporting unit substantially exceeded their carrying value and was not at risk of impairment. As a result of lower than expected performance since the acquisition, the projections used in the Fiscal 2015 valuation reflect lower assumptions across certain key areas versus prior plans for Lane Bryant . In particular, the sales growth assumptions were lowered to reflect the shortfall in actual results versus those previously projected and a change in management's view of the long-term growth rates of the business. In addition, gross margin rates were lowered to reflect the deleveraging of fixed expenses as a result of lower unit sales volume expectations. The combination of these factors resulted in a significant reduction in the fair value of the Lane Bryant reporting unit in comparison to the Fiscal 2014 Valuation. Given that the percentage by which the fair value exceeded its carrying value as of the prior annual impairment valuation was only 7%, the reduction in future cash flows in the Fiscal 2015 Valuation resulted in a decrease in the fair value of the Lane Bryant reporting unit such that it was less than its carrying value. Thus, the Company conducted a step two analysis. In the second step of the goodwill impairment test, the Company, with the assistance of an independent valuation firm, compared the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill. The fair value of the Lane Bryant reporting unit was allocated to all of the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination in Fiscal 2015 and the fair value was the purchase price paid to acquire the reporting unit. As a result of this valuation, it was determined that the carrying amount of Lane Bryant 's goodwill exceeded the implied fair value of that goodwill. The Company recognized a goodwill impairment loss of $261.7 million during Fiscal 2015 to write down the carrying value of Lane Bryant 's goodwill to its implied fair value of $57.4 million . In addition, in connection with the step two analysis, because of the lower revenue assumptions discussed above, the fair value of the trade name declined from Fiscal 2014, it was determined that the Lane Bryant trade name was also impaired. The fair value of the trade name was determined using the relief-from-royalty method (Level 3 measurement). The Company recognized an impairment loss of $44.7 million during Fiscal 2015 to write down the carrying value of Lane Bryant 's trade name intangible asset to its fair value of $211.8 million . Fiscal 2014 Studio Y Impairment During the fourth quarter of Fiscal 2014, in connection with our annual budget process for Fiscal 2015, management at maurices reached a decision to stop selling product under its Studio Y label based on an evaluation of its other product labels which are expected to generate higher returns. As a result, the Company recorded a non-cash impairment charge of $13.0 million in its maurices segment in Fiscal 2014 to write-off the entire carrying value of the Studio Y trade name as the net cash flows from the sell-off of remaining product reflected no fair value. These impairment losses have been disclosed separately within Impairment of intangible assets on the face of the accompanying consolidated statements of operations. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Jul. 25, 2015 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following: July 25, 2015 July 26, 2014 (millions) Prepaid expenses $ 45.6 $ 40.6 Accounts and other receivables 70.8 90.8 Short-term investments 13.4 30.4 Other current assets 1.7 5.0 Total prepaid expenses and other current assets $ 131.5 $ 166.8 |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Jul. 25, 2015 | |
Accounts Payable and Accrued Liabilities, Current [Abstract] | |
Accrued Expenses and Other Current Liabilities | Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following: July 25, 2015 July 26, 2014 (millions) Accrued salary, wages and related expenses (a) $ 176.9 $ 120.6 Accrued operating expenses (b) 202.1 164.0 Sales and other taxes payable 14.2 15.7 Other 10.0 8.6 Total accrued expenses and other current liabilities $ 403.2 $ 308.9 (a) The increase is primarily due to the reclassification of approximately $35 million of retirement compensation from Other non-current liabilities to Accrued expenses and other current liabilities during Fiscal 2015, as more fully described in Employment Agreements section in Note 14. (b) The increase is primarily due to the establishment of a legal reserve of approximately $50 million in connection with the Justice pricing lawsuits, as more fully described in Note 14. |
Debt
Debt | 12 Months Ended |
Jul. 25, 2015 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt consists of the following: July 25, 2015 July 26, 2014 (millions) Revolving credit agreement $ 116.0 $ 172.0 Less: current portion — — Total long-term debt $ 116.0 $ 172.0 Revolving Credit Agreement In March 2013, the Company and certain of its domestic subsidiaries entered into an amended and restated revolving credit agreement (the “Revolving Credit Agreement”) with the lenders thereunder and JPMorgan Chase Bank, N.A., as administrative agent. The Company's Revolving Credit Agreement provided a senior secured revolving credit facility up to $500 million , with an optional additional increase of up to $100 million . The Company’s obligations under the Revolving Credit Agreement were guaranteed by certain of its domestic subsidiaries (the “Subsidiary Guarantors”) and subject to restrictions. As collateral security under the borrowing agreement and the guarantees thereof, the Company and the Subsidiary Guarantors granted to the administrative agent for the benefit of the lenders, a first priority lien on substantially all of their tangible and intangible assets, including, without limitation, certain domestic inventory and certain material real estate. Borrowings under the Revolving Credit Agreement bore interest at a variable rate determined using a base rate equal to the greatest of (i) prime rate, (ii) federal funds rate plus 50 basis points, or (iii) LIBOR plus 100 basis points; plus an applicable margin ranging from 50 basis points to 200 basis points based on a combination of the type of borrowing (prime or LIBOR) and average borrowing availability during the previous fiscal quarter. In addition to paying interest on any outstanding borrowings under the Revolving Credit Agreement, the Company was required to pay a commitment fee to the lenders under the Revolving Credit Agreement in respect of the unutilized commitments in an amount ranging between 25 basis points and 37.5 basis points per annum based on the Company’s average utilization during the previous fiscal quarter. As of July 25, 2015, after taking into account the $116.0 million of revolving debt outstanding and the $13.3 million in outstanding letters of credit, the Company had $322.4 million of its variable availability under the Revolving Credit Agreement. In August 2015, in connection with the ANN Acquisition, the Company amended the Revolving Credit Agreement as more fully described in Note 19. Restrictions under the Revolving Credit Agreement The Company is subject to certain restrictions and financial covenants with respect to minimum availability limits under the Revolving Credit Agreement. Such limits are variable based on the outstanding borrowing commitment. Should Availability (as defined in the Revolving Credit Agreement) fall below the minimum level for three consecutive days, the Company would be in a Reduced Availability Period and would be subject to a fixed charge coverage ratio test. As of July 25, 2015, the Reduced Availability Period would be triggered if our availability were to drop below approximately $50.0 million for three consecutive days. As of July 25, 2015, the Company had $322.4 million in availability under the Revolving Credit Agreement and accordingly, the fixed charge coverage ratio test does not apply. If the Company is in a Reduced Availability Period at the end of a fiscal quarter, the Company’s fixed charge coverage ratio must be at least 1.00 to 1.00 . The ratio is calculated based on four consecutive fiscal quarter end dates ending with the current quarter. The fixed charge coverage ratio is defined as a ratio of consolidated earnings (as defined in the Revolving Credit Agreement), less capital expenditures, to consolidated fixed charges. In addition to the above, the Revolving Credit Agreement contains customary negative covenants, subject to negotiated exceptions, on (i) liens and guarantees, (ii) investments, (iii) indebtedness, (iv) significant corporate changes including mergers and acquisitions, (v) dispositions, (vi) restricted payments, cash dividends and certain other restrictive agreements. The borrowing agreement also contains customary events of default, such as payment defaults, cross-defaults to other material indebtedness, bankruptcy and insolvency, the occurrence of a defined change in control, or the failure to observe the negative covenants and other covenants related to the operation of the Company’s business. The Company’s obligations under the Revolving Credit Agreement are guaranteed by certain of its domestic subsidiaries (the “Subsidiary Guarantors”). As collateral security under the borrowing agreement and the guarantees thereof, the Company and the Subsidiary Guarantors have granted to the administrative agent for the benefit of the lenders, a first priority lien on substantially all of their tangible and intangible assets, including, without limitation, certain domestic inventory and certain material real estate. The Company's Revolving Credit Agreement allows us to pay dividends, provided that at the time of and immediately after giving effect to the dividend, (i) there is no default or event of default, and (ii) Availability (as defined in the Revolving Credit Agreement) is not less than 20% of the aggregate Revolving Commitments (as defined in the Revolving Credit Agreement), subject to a minimum predetermined availability limit. Dividends are payable when declared by our Board of Directors. Loss on Extinguishment of Debt In Fiscal 2012, the Company incurred $300 million of borrowings under a six -year, variable rate term loan and assumed a $7.8 million mortgage obligation. The term loan was fully repaid during Fiscal 2013, resulting in an aggregate $8.5 million pretax loss related the write-off of the balances of the original issue discount and deferred financing costs. In addition, the outstanding principal balance of the mortgage obligation was prepaid in full in Fiscal 2013, resulting in a $0.8 million pretax loss. Such losses are presented separately within Loss on extinguishment of debt in the accompanying consolidated statements of operations. |
Income Taxes
Income Taxes | 12 Months Ended |
Jul. 25, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Taxes on Income Domestic and foreign pretax (loss) income from continuing operations are as follows: Fiscal Years Ended July 25, July 26, July 27, (millions) Domestic $ (303.1 ) $ 144.7 $ 189.8 Foreign 62.5 58.8 52.8 Total (loss) income from continuing operations before provision for income taxes $ (240.6 ) $ 203.5 $ 242.6 The provision (benefit) from continuing operations for current and deferred income taxes are as follows: Fiscal Years Ended July 25, July 26, July 27, Current: (millions) Federal (a) $ (20.8 ) $ 15.2 $ 30.6 State and local (a) 8.8 13.5 5.7 Foreign 14.8 12.3 10.6 2.8 41.0 46.9 Deferred: Federal 0.9 24.9 38.6 State and local (6.5 ) (0.2 ) 1.4 Foreign (1.0 ) (0.4 ) 0.5 (6.6 ) 24.3 40.5 Total (benefit) provision for income taxes from continuing operations $ (3.8 ) $ 65.3 $ 87.4 (a) Excludes excess tax benefits of approximately $(1.2) million in Fiscal 2015, $4.2 million in Fiscal 2014 and $14.1 million in Fiscal 2013 resulting from stock-based compensation arrangements. Such amounts were recorded within equity. Tax Rate Reconciliation The differences between income taxes expected at the U.S. federal statutory income tax rate of 35% and income taxes provided for continuing operations are as set forth below: Fiscal Years Ended July 25, July 26, July 27, (millions) (Benefit) provision for income taxes from continuing operations at the U.S. federal statutory rate $ (84.3 ) $ 71.2 $ 84.9 Increase (decrease) due to: State and local income taxes, net of federal benefit 4.1 8.8 8.4 Tax benefit related to deferred compensation (13.7 ) — — Goodwill impairment 91.6 — — Net change relating to uncertain income tax benefits (0.7 ) (2.3 ) (6.4 ) Indefinitely reinvested foreign earnings 1.7 (11.6 ) (0.9 ) Other – net (2.5 ) (0.8 ) 1.4 Total (benefit) provision for income taxes from continuing operations $ (3.8 ) $ 65.3 $ 87.4 The Company's effective tax rate is lower than the statutory rate principally as a result of a goodwill impairment loss of $261.7 million as discussed in Note 8, which is treated as a permanent non-deductible item, offset in part by a tax benefit related to previously deferred compensation of approximately $35 million , which became fully deductible in Fiscal 2015 under the terms of the retirement agreement for the former President and CEO of Justice , as discussed in Note 14. Tax Incentives In connection with the Company’s relocation of its dressbarn and corporate offices to New Jersey, as well as the expansion of its distribution centers in Ohio and Indiana, the Company was approved for various state and local tax incentives. In order to receive these incentives, the Company will generally need to meet certain minimum employment or expenditure commitments, as well as comply with periodic reporting requirements. These incentives, estimated to total approximately $60 million , are expected to be recognized over a 10 - 15 year period which began in Fiscal 2015. Approximately $2.0 million was recognized in Fiscal 2015. Deferred Taxes Significant components of the Company's net deferred tax assets (liabilities) are as follows: July 25, July 26, Deferred tax assets: (millions) Inventories $ 18.7 $ 14.3 Tax credits and net operating loss carryforwards 18.7 14.2 Accrued payroll and benefits 78.3 59.9 Legal reserve 21.0 — Share-based compensation 23.7 23.1 Straight-line rent 45.7 50.0 Federal benefit of uncertain tax positions 14.7 15.5 Other 19.2 18.8 Total deferred tax assets 240.0 195.8 Deferred tax liabilities: Depreciation 113.0 85.8 Amortization 168.6 171.7 Foreign unremitted earnings 32.8 20.7 Other 14.0 15.8 Total deferred tax liabilities 328.4 294.0 Valuation allowance (4.9 ) (2.8 ) Net deferred tax liabilities $ (93.3 ) $ (101.0 ) As of July 25, 2015, we have not provided deferred U.S. income taxes on approximately $42.8 million of undistributed earnings from non-U.S. subsidiaries. Any unrecognized deferred income tax liability resulting from these amounts is not expected to reverse in the foreseeable future; furthermore, the undistributed foreign earnings are permanently reinvested. If the Company elects to distribute these foreign earnings in the future, they could be subject to additional income taxes. Determination of the amount of any unrecognized deferred income tax liability is not practicable because such liability, if any, is dependent on circumstances existing if and when remittance occurs. As part of the acquisition of Lane Bryant and Catherines ' businesses, the Company acquired the pre-existing federal and state net operating loss carryforwards, tax credits and charitable contribution carryovers valued at $69.3 million . The Company utilized $19.4 million of these acquired net operating loss carryforwards, tax credits and unexpired charitable contributions carryovers in Fiscal 2015 and expects to utilize the remaining amounts in future periods, subject to annual Section 382 and other statutory limitations. As of July 25, 2015, the carryforwards were valued at $9.5 million . As of July 25, 2015, the Company had a $4.9 million valuation allowance against the aggregate carrying value of its deferred tax assets. Such valuation allowances provide for the uncertainty that a portion of the recognized deferred tax assets may not be realizable. The valuation allowance increased by $2.1 million in Fiscal 2015. In December 2014, legislation was enacted which extended bonus depreciation allowed on qualifying assets placed into service during calendar year 2014. As a result, approximately $32 million of current taxes were deferred in the second quarter of Fiscal 2015 and are reflected in Deferred income taxes as of July 25, 2015. Net Operating Loss Carry Forwards As of July 25, 2015, the Company had U.S. Federal net operating loss carryforwards of $1.0 million and state net operating loss carryforwards of $52.1 million that are available to offset future U.S. Federal and state taxable income. The U.S. Federal net operating losses have a twenty -year carryforward period, and expire in Fiscal 2017 . The state net operating losses have carryforward periods of five to twenty years, with varying expiration dates and amounts as follows: $15.2 million in one to five years, $11.8 million in six to ten years, $20.0 million in eleven to fifteen years and $5.1 million in sixteen to twenty years. Uncertain Income Tax Benefits Reconciliation of Liabilities A reconciliation of the beginning and ending amounts of unrecognized tax benefits, excluding interest and penalties, for each fiscal year is presented below: Fiscal Years Ended July 25, 2015 July 26, 2014 July 27, 2013 (millions) Unrecognized tax benefit beginning balance $ 29.9 $ 31.2 $ 40.5 Additions related to acquisitions — — 2.8 Additions related to current period tax positions 1.6 1.5 1.5 Additions related to tax positions in prior years 6.7 4.3 2.2 Reductions related to prior period tax positions (3.2 ) — (3.0 ) Reductions related to settlements with taxing authorities (0.3 ) (1.5 ) (5.7 ) Reductions related to expiration of statute of limitations (0.6 ) (5.6 ) (7.1 ) Unrecognized tax benefit ending balance $ 34.1 $ 29.9 $ 31.2 The Company classifies interest and penalties related to unrecognized tax benefits as part of its provision for income taxes. A reconciliation of the beginning and ending amounts of accrued interest and penalties related to unrecognized tax benefits for each fiscal year is presented below: Fiscal Years Ended July 25, 2015 July 26, 2014 July 27, 2013 (millions) Accrued interest and penalties beginning balance $ 13.8 $ 16.5 $ 21.2 Reductions credited to expense, net (2.3 ) (2.7 ) (4.7 ) Accrued interest and penalties ending balance $ 11.5 $ 13.8 $ 16.5 The Company’s liability for unrecognized tax benefits (including accrued interest and penalties), which is primarily included in Other non-current liabilities in the accompanying consolidated balance sheets, was $40.7 million as of July 25, 2015 and $40.9 million as of July 26, 2014. Future Changes in Unrecognized Tax Benefits The amount of unrecognized tax benefits relating to the Company's tax positions is subject to change based on future events including, but not limited to, the settlements of ongoing audits and/or the expiration of applicable statutes of limitations. Although the outcomes and timing of such events are highly uncertain, the Company anticipates that the balance of the liability for unrecognized tax benefits will decrease by approximately $2.8 million during the next twelve months. However, changes in the occurrence, expected outcomes and timing of those events could cause the Company’s current estimate to change materially in the future. The Company’s portion of gross unrecognized tax benefits that would affect its effective tax rate, including interest and penalties, is $23.2 million . The Company files tax returns in the U.S. federal and various state, local and foreign jurisdictions. With few exceptions, the Company is no longer subject to examinations by the relevant tax authorities for years prior to Fiscal 2009. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Jul. 25, 2015 | |
Employee Benefits and Share-based Compensation [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans Retirement Savings Plan (401(k)) The Company currently sponsors a defined contribution retirement savings plan (401(k)). This plan covers substantially all eligible U.S. employees. Participating employees may contribute a percentage of their annual compensation, subject to certain limitations under the Internal Revenue Code. The Company's contribution is made in accordance with a matching formula established prior to the beginning of each plan year. For the plan year effective January 1, 2015, the Company will contribute a matching amount based on eligible salary contributed by an employee equal to 100% of the first 3% contributed and 50% of the next 2% contributed. Under the terms of the plan, such matching contributions are immediately vested. The Company incurred expenses relating to its contributions to and administration of its 401(k) plans of $8.8 million in Fiscal 2015, $5.2 million in Fiscal 2014 and $4.7 million in Fiscal 2013. Executive Retirement Plan The Company sponsors an Executive Retirement Plan (the “ERP Plan”) for certain officers and key executives. The ERP Plan is a non-qualified deferred compensation plan. The purpose of the ERP Plan is to attract and retain a select group of management or highly compensated employees and to provide them with an opportunity to defer compensation on a pretax basis above Internal Revenue Service limitations. ERP Plan balances cannot be rolled over to another qualified plan or IRA upon distribution. Unlike a qualified plan, the Company is not required to pre-fund the benefits payable under the ERP Plan. ERP Plan participants can contribute up to 50% of base salary and 75% of bonus, before federal and state taxes are calculated. The Company makes a matching contribution to the ERP Plan in the amount of 100% on the first 1% of base salary and bonus salary deferred up to $265,000 . The Company makes an additional matching contribution to the ERP Plan in the amount of 100% on the first 5% of base salary and bonus salary deferred in excess of $265,000 . Plan Employees vest immediately in their voluntary deferrals and are incrementally vested in their employer matching contributions over a five year vesting period after which they are 100% vested. The Company incurred expenses related to its matching contributions of approximately $2.1 million in Fiscal 2015, $3.4 million in Fiscal 2014 and $2.7 million in Fiscal 2013 relating to the ERP Plan. In addition, as the ERP Plan is unfunded by the Company, the Company is also required to pay an investment return to participating employees on all account balances in the ERP Plan based on 28 reference investment fund elections offered to participating employees. As a result, the Company’s obligations under the ERP Plan are subject to market appreciation and depreciation, which resulted in expense of $3.3 million in Fiscal 2015, $7.2 million in Fiscal 2014 and $7.7 million in Fiscal 2013. The Company’s obligations under the ERP Plan, including employee compensation deferrals, matching employer contributions and investment returns on account balances, were $70.7 million as of July 25, 2015 and $65.9 million as of July 26, 2014. As of July 25, 2015, $3.8 million was classified within Accrued expenses and other current liabilities and $66.9 million was classified within Other non-current liabilities in the accompanying consolidated balance sheets. As of July 26, 2014, $3.6 million was classified within Accrued expenses and other current liabilities and $62.3 million was classified within Other non-current liabilities in the accompanying consolidated balance sheets. Employee Stock Purchase Plan The Company also sponsors an Employee Stock Purchase Plan, which allows employees to purchase shares of the Company’s common stock during each quarterly offering period at a 10% discount through bi-weekly payroll deductions. Expenses incurred during Fiscal 2015, Fiscal 2014 and Fiscal 2013 relating to this plan were de minimis. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jul. 25, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Lease Commitments The Company leases all of its retail stores. Certain leases provide for additional rents based on percentages of net sales, charges for real estate taxes, insurance and other occupancy costs. Store leases generally have an initial term of approximately ten years with one or more five -year options to extend the lease. Some of these leases have provisions for rent escalations during the initial term. The Company’s operating lease obligations represent future minimum lease payments under non-cancelable operating leases as of July 25, 2015. The minimum lease payments do not include common area maintenance ("CAM") charges or real estate taxes, which are also required contractual obligations under the operating leases. In the majority of the Company’s operating leases, CAM charges are not fixed and can fluctuate from year to year. A summary of occupancy costs follows: Fiscal Years Ended July 25, July 26, July 27, (millions) Base rentals $ 404.4 $ 395.5 $ 391.6 Percentage rentals 20.5 23.2 21.0 Other occupancy costs, primarily CAM and real estate taxes 143.6 133.5 128.6 Total $ 568.5 $ 552.2 $ 541.2 The following is a schedule of future minimum rentals under non-cancelable operating leases as of July 25, 2015: Fiscal Years Minimum Operating Lease Payments (a) (b) (millions) 2016 $ 407.5 2017 350.1 2018 284.4 2019 225.1 2020 180.3 Subsequent years 472.4 Total future minimum rentals $ 1,919.8 (a) Net of sublease income, which was not significant in any period. (b) Although such amounts are generally non-cancelable, certain leases are cancelable if specified sales levels are not achieved. All future minimum rentals under such leases have been included in the above table. Leases with Related Parties The Company leases two stores from its Chairman or related trusts. Future minimum rentals under such related-party leases are approximately $0.4 million for Fiscal 2016 and approximately $0.2 million in each year until the second lease expires in June 2020 for an aggregate of $1.2 million , which has been included in the above table. The leases also contain provisions for cost escalations and additional rent based on net sales in excess of stipulated amounts. Rent expense under these leases amounts to approximately $0.4 million in Fiscal 2015, Fiscal 2014 and Fiscal 2013. Employment Agreements The Company has employment agreements with certain executives in the normal course of business which provide for compensation and certain other benefits. These agreements also provide for severance payments under certain circumstances. The former President and CEO of our Justice brand retired effective January 24, 2015. As a result, previously accrued deferred compensation under the terms of his employment agreement of approximately $35 million became payable and was reclassified from Other non-current liabilities to Accrued expenses and other current liabilities as of July 25, 2015. This obligation was paid during the first quarter of Fiscal 2016. In addition to the deferred compensation, and also pursuant to the terms of his employment agreement, a previously accrued severance payment of $9 million was paid into a Rabbi Trust in Fiscal 2015. As of July 25, 2015, these funds were recorded as restricted cash within short-term investments included in Prepaid expenses and other current assets with a corresponding liability included in Accrued expenses and other current liabilities. This balance was also paid during the first quarter of Fiscal 2016. Other Commitments The Company enters into various cancelable and non-cancelable commitments during the year. Typically, those commitments are for less than a year in duration and are principally focused on the construction of new retail stores and the procurement of inventory. The Company normally does not maintain any long-term or exclusive commitments or arrangements to purchase merchandise from any single supplier. Preliminary commitments with the Company’s private-label merchandise vendors typically are made five to seven months in advance of planned receipt date. Generally, these merchandise purchase commitments are cancelable up to 30 days prior to the vendor’s scheduled shipment date. In addition, the Company has $13.3 million of outstanding letters of credit as of July 25, 2015. Legal Matters The Company is, from time to time, involved in routine litigation incidental to the conduct of our business, including litigation instituted by persons injured upon premises under our control; litigation regarding the merchandise that we sell, including our advertising and marketing practices and product and safety concerns; litigation with respect to various employment matters, including wage and hour litigation; litigation with present or former employees; and litigation regarding intellectual property rights. Although such litigation is routine and incidental to the conduct of our business, as with any business of our size with a significant number of employees and significant merchandise sales, such litigation could result in large monetary awards. However, management believes that, excluding the effect of the Justice pricing lawsuits discussed below, current pending litigation will not have a material adverse effect on our consolidated financial statements. Justice Pricing Lawsuits Mehigan v. Ascena Retail Group, Inc. and Tween Brands, Inc. On February 12, 2015, Melinda Mehigan and Fonda Kubiak, both consumers, filed a purported class action proceeding (the “Mehigan case”) against Ascena Retail Group, Inc. and Tween Brands, Inc. (doing business as “Justice”) in the United States District Court for the Eastern District of Pennsylvania, on behalf of themselves and all similarly situated consumers who, in the case of Ms. Mehigan in the State of New Jersey, and in the case of Ms. Kubiak in the State of New York, made purchases at Justice from 2009 to 2015 (the “Alleged Class Period”). The lawsuit alleges that Justice violated state comparative pricing laws in connection with advertisements promoting a 40% discount. The plaintiffs further allege false advertising, violation of state consumer protection statutes, breach of contract, breach of express warranty, and unfair benefit to Justice . The plaintiffs seek to stop Justice ’s allegedly unlawful practice, and obtain damages for Justice ’s customers in the named states. They also seek interest and legal fees. On February 17, 2015, the complaint in the Mehigan case was amended to add five more named individual plaintiffs and to add the same allegations against Justice in the States of California, Florida, Illinois and Texas. On April 8, 2015, the complaint in the Mehigan case was amended a second time seeking to make the case a nationwide purported class action lawsuit. As amended, the case covers Justice customers in 47 states. The excluded states are Hawaii, Alaska and Ohio. During the Alleged Class Period, Justice did not operate any stores in Hawaii or Alaska. A similar class action lawsuit making substantially the same allegations as the Mehigan case was settled in December 2014 in Ohio. Cowhey v. Tween Brands, Inc. On February 17, 2015, Carol Cowhey, a consumer, filed a purported class action proceeding (the “Cowhey case”) against Ascena Retail Group, Inc. and Tween Brands, Inc. (doing business as “Justice”) in the Court of Common Pleas in Philadelphia, Pennsylvania on behalf of herself and all other similarly situated consumers who in the State of Pennsylvania made purchases at Justice during the Alleged Class Period. The allegations in the Cowhey case are substantially the same as those in the Mehigan case. The relief sought in the Cowhey case focuses on remedies available under Pennsylvania law, which the plaintiff claims include treble damages. On March 19, 2015, Justice removed the Cowhey case to federal court in the United States District Court for the Eastern District of Pennsylvania. Consolidation of Mehigan and Cowhey Cases (Rougvie) On April 8, 2015, the United States District Court for the Eastern District of Pennsylvania consolidated the Cowhey case and the Mehigan case. They are now consolidated for all pre-trial purposes in the federal court in the Eastern District of Pennsylvania. On June 2, 2015, the court held a Rule 16 Conference and issued a Scheduling Order and Settlement Conference Order. The Scheduling Order sets a fact and expert discovery deadline of December 4, 2015, with trial scheduled for early 2016. In light of the settlement in principle described below, the trial will not go forward. Traynor-Lufkin v. Tween Brands, Inc. On March 6, 2015, Katie Traynor-Lufkin and three other named plaintiffs, all consumers, filed a purported nationwide class action (the “Traynor-Lufkin case”) against Tween Brands, Inc. (doing business as “Justice”) in the Court of Common Pleas in Cuyahoga County, Ohio. The Traynor-Lufkin case purports to include a class of Justice customers in 47 states. As with the Mehigan case, the Traynor-Lufkin case excludes Hawaii, Alaska and Ohio. During the Alleged Class Period, Justice did not operate any stores in Hawaii or Alaska. In December 2014, Justice settled a similar class action lawsuit in the State of Ohio. The allegations and damages sought in the Traynor-Lufkin case are substantially the same as those in the Mehigan case. Removal of Traynor-Lufkin Case and Motion to Transfer On April 7, 2015, Justice removed the Traynor-Lufkin case to the United States District Court for the Northern District of Ohio. On April 13, 2015, Justice filed a motion under 28 U.S.C. § 1408(a) to transfer the Traynor-Lufkin case to the United States District Court for the Eastern District of Pennsylvania. In seeking the transfer, Justice argued that there were already two consolidated actions pending in the Eastern District of Pennsylvania and that a forum in Ohio is not appropriate because no Ohio consumers are involved in the case. The Eastern District of Pennsylvania was advised that the Traynor-Lufkin case was related to Rougvie, and the case was reassigned on May 27, 2015. Consolidation of Traynor-Lufkin and Rougvie case On June 18, 2015, the United States District Court for the Eastern District of Pennsylvania consolidated the Cowhey case and the Mehigan case (collectively referred to as Rougvie) and the Traynor-Lufkin matters. The Scheduling and Settlement Conference Orders issued in the Rougvie matter are applicable to all parties in the Traynor-Lufkin and Rougvie cases, including the Company and all of the named plaintiffs in the consolidated actions. Metoyer v. Tween Brands, Inc. On May 29, 2015, Theresa Metoyer, a consumer, filed a purported class action against Tween Brands, Inc. in the United States District Court for the Central Division of California, Eastern Division, on behalf of herself and all other similarly situated consumers who made purchases from Justice stores located in California during the four years preceding the filing of the lawsuit. The allegations in the Metoyer case are substantially the same as those in the other Justice pricing lawsuits described above. The relief sought by plaintiff is substantially the same as that sought in the other lawsuits. On June 17, 2015, after consulting with opposing counsel, an Ex Parte Motion for an Extension of Time to Answer the was requested. The Court did not rule on the Motion, and Tween Brands, Inc. filed an Answer on June 18, 2015. The Court issued an Order setting a scheduling conference for August 24, 2015. On August 21, 2015, the Court issued an Order canceling the August 24 conference, directing the parties to file a joint status report, and indicating that the Court would consider resetting a status conference after review of the joint status report. The Company expects to file a motion to stay this case in light of the broader settlement in principle described below. Gallagher v. Tween Brands, Inc. On June 4, 2015, Robert Gallagher, a consumer, filed a lawsuit against Tween Brands, Inc. in the United States District Court for the Eastern District of Missouri, Eastern Division. This lawsuit includes both national and Missouri purported class actions. The plaintiff seeks monetary damages and reasonable costs and attorneys' fees. On June 25, 2015, the Court granted the parties’ Consent Motion for Extension of Defendant’s Time to Respond to the Complaint until after the Judicial Panel on Multidistrict Litigation (“JPML”) issues a ruling on the Motion to Transfer. The JPML issued its ruling denying the Motion to Transfer on August 7, 2015. On August 27, 2015, the Company filed its answer to the case. The Company expects to file a motion to stay this case in light of the broader settlement in principle described below. Kallay v. Tween Brands, Inc. On June 5, 2015, Andrea Kallay, a consumer, filed a purported class action against Tween Brands, Inc. in the United States District Court for the Southern District of Ohio, Eastern Division. This lawsuit includes both national and Wisconsin class actions. The plaintiff seeks monetary damages and reasonable costs and attorneys' fees. On June 29, 2015, the Court granted the parties’ Consent Motion for Extension of Defendant’s Time to Respond to the Complaint until after the JPML issues a ruling on the Motion to Transfer. Following the JPML’s order denying the Motion to Transfer, the Company filed an Answer to the Complaint on August 28, 2015. The Company expects to file a motion to stay this case in light of the broader settlement in principle described below. Joiner v. Tween Brands, Inc. On June 1, 2015, Rebecca Joiner, a consumer, filed a purported class action against Tween Brands, Inc. in the United States District Court for the District of Maryland. This lawsuit includes putative national and Maryland classes. The plaintiff seeks monetary damages and reasonable costs and attorney’s fees. The parties have stipulated to an extension of the time to respond to the Complaint until after the JPML issues a ruling on the Motion to Transfer. Following the JPML’s order denying the Motion to Transfer, the Company filed an Answer to the Complaint on August 28, 2015. The Company expects to file a motion to stay this case in light of the broader settlement in principle described below. Loor v. Tween Brands, Inc. On June 11, 2015, Yanetsy Loor, a consumer, filed a purported class action against Tween Brands, Inc. in the United States District Court for the Middle District of Florida. This lawsuit includes putative national and Florida classes. The plaintiff seeks monetary damages and reasonable costs and attorney’s fees. The Company filed its Answer on August 21, 2015. The Company expects to file a motion to stay this case in light of the broader settlement in principle described below. Legendre v. Tween Brands, Inc. On June 17, 2015, David Legendre, a consumer, filed a purported class action against Tween Brands, Inc. in the United States District Court for the District of New Jersey. This lawsuit includes both national and New Jersey class actions. The plaintiff seeks monetary damages and reasonable costs and attorney’s fees. The Company expects to file a motion to stay this case in light of the broader settlement in principle described below. In re Tween Brands, Inc., Marketing & Sales Practices Litigation. MDL No. 2646 On June 1, 2015, Andrea Kallay, the plaintiff in Kallay v. Tween Brands, Inc., filed a Motion to Transfer to the United State District Court for the Southern District of Ohio and for creation of a Multidistrict Litigation (MDL) proceeding styled In re: Tween Brands, Inc., Marketing and Sales Practices Litigation , MDL 2646. Responses to the Motion to Transfer were submitted on June 23, 2015. The majority of plaintiffs in the above listed cases filed response motions in support of transfer and consolidation to the Southern District of Ohio. The Rougvie plaintiffs filed a response motion opposing transfer to the Southern District of Ohio and arguing for transfer to the Eastern District of Pennsylvania. Justice filed a Response in Opposition, supporting transfer and consolidation but arguing that the proper venue for the MDL is the Eastern District of Pennsylvania. The JPML held a hearing on July 30, 2015 on the Motion to Transfer and subsequently denied the Motion to Transfer in an Order issued on August 7, 2015. Settlement Agreed to at July 2, 2015 Mediation In July 2015, an agreement in principle was reached with the plaintiffs in the Rougvie case to settle the lawsuit on a class basis for approximately $50 million , including payments to members of the class, payment of legal fees and expenses of settlement administration. The Company believes that such amount reflects a liability that is both probable and reasonably estimable, thus a reserve for approximately $50 million was established in the fourth quarter of Fiscal 2015. This settlement agreement is subject to the negotiation of a definitive class action settlement agreement, notice to the class and opportunity for class members to object or exclude themselves from the settlement, approval by the United States District Court for the Eastern District of Pennsylvania after consideration of any objections, and potential appeal to the United States Court of Appeals for the Third Circuit. Once there is a final non-appealable approval of the settlement, it will resolve all of the outstanding Justice class actions. If the Plaintiffs in the other Justice cases do not agree to dismissal, the Company will move to dismiss those cases in light of the binding release of all class members affected by the settlement. There is some possibility that individual class members could exclude themselves from the settlement, but they would then only be able to pursue individual claims rather than class claims. If the six plaintiffs who have brought the other actions excluded themselves from the settlement, the Company believes that the liability associated with any of their individual cases would not be material. If the matters described herein do not occur and the pricing lawsuits are not settled on a class basis for approximately $50 million in accordance with the agreement in principle, the ultimate resolution of these matters may or may not result in an additional material loss which cannot be reasonably estimated at this time. |
Equity
Equity | 12 Months Ended |
Jul. 25, 2015 | |
Equity [Abstract] | |
Equity | Equity Capital Stock The Company’s capital stock consists of one class of common stock and one class of preferred stock. There are 360 million shares of common stock authorized to be issued and 100,000 shares of preferred stock authorized to be issued. There are no shares of preferred stock issued or outstanding. Common Stock Repurchase Program In Fiscal 2010, the Company’s Board of Directors authorized a $100 million share repurchase program . The program was then expanded in Fiscal 2011 to cover an additional $100 million of authorized purchases (the “2010 Stock Repurchase Program”). Under the 2010 Stock Repurchase Program, purchases of shares of common stock may be made at the Company’s discretion from time to time, subject to overall business and market conditions. Cumulative repurchases under the 2010 Stock Repurchase Plan total $110.1 million . There were no repurchases of common stock by the Company during Fiscal 2015, Fiscal 2014 or Fiscal 2013 under its repurchase program. Repurchased shares normally are retired and treated as authorized but unissued shares. The remaining availability under the 2010 Stock Repurchase Program was $89.9 million at July 25, 2015. Net (Loss) Income Per Common Share Basic net (loss) income per common share is computed by dividing the net (loss) income applicable to common shares after preferred dividend requirements, if any, by the weighted-average number of common shares outstanding during the period. Diluted net (loss) income per common share adjusts basic net (loss) income per common share for the effects of outstanding stock options, restricted stock, restricted stock units and any other potentially dilutive financial instruments, only in the periods in which such effect is dilutive under the treasury stock method. The weighted-average number of common shares outstanding used to calculate basic net (loss) income per common share is reconciled to those shares used in calculating diluted net income per common share as follows: Fiscal Years Ended July 25, 2015 (a) July 26, 2014 July 27, 2013 (millions) Basic 162.6 160.6 157.3 Dilutive effect of stock options, restricted stock and restricted stock units — 4.5 6.0 Diluted shares 162.6 165.1 163.3 (a) There was no dilutive effect of stock options, restricted stock and restricted stock units in Fiscal 2015 as the impact of these items was anti-dilutive because of the Company's net loss incurred during the year. Options to purchase shares of common stock at an exercise price greater than the average market price of the common stock during the reporting period are anti-dilutive, and therefore not included in the computation of diluted net income per common share. In addition, the Company has outstanding restricted stock units that are issuable only upon the achievement of certain service and/or performance or market-based goals. Such performance or market-based restricted stock units are included in the computation of diluted shares only to the extent the underlying performance or market conditions (a) are satisfied prior to the end of the reporting period or (b) would be satisfied if the end of the reporting period were the end of the related contingency period, and the result would be dilutive under the treasury stock method. As of the end of Fiscal 2015, Fiscal 2014 and Fiscal 2013 there was an aggregate of approximately 15.8 million , 5.6 million and 3.0 million , respectively, of additional shares issuable upon the exercise of anti-dilutive options and/or the contingent vesting of performance-based and market-based restricted stock units that were excluded from the diluted share calculations. Dividends The Company has never declared or paid cash dividends on its common stock. However, payment of dividends is within the discretion of, and are payable when declared by, the Company’s Board of Directors. Additionally, payments of dividends are limited by the Company's borrowing arrangements as described in Note 11 and Note 19. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Jul. 25, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Long-term Stock Incentive Plan The Company is authorized to issue up to 51 million shares of stock-based awards to eligible employees and directors of the Company under its 2010 Stock Incentive Plan, as amended (the “2010 Stock Plan”). The 2010 Stock Plan provides for the granting of either Incentive Stock Options or non-qualified options to purchase shares of common stock, as well as the award of shares of restricted stock and other stock-based awards (including restricted stock units). The 2010 Stock Plan expires on September 19, 2022. As of July 25, 2015, there were approximately 8.3 million shares under the 2010 Stock Plan available for future grants. The Company issues new shares of common stock when stock option awards are exercised. Impact on Results A summary of the total compensation expense and associated income tax benefit recognized related to stock-based compensation arrangements is as follows: Fiscal Years Ended July 25, July 26, July 27, (millions) Compensation expense $ 18.2 $ 30.6 $ 29.5 Income tax benefit $ (6.8 ) $ (11.5 ) $ (11.0 ) Stock Options Stock option awards outstanding under the Company’s current plans have been granted at exercise prices that are equal to or exceed the market value of its common stock on the date of grant. Such options generally vest over a period of four or five years and expire at either seven or ten years after the grant date. The Company recognizes compensation expense ratably over the vesting period, net of estimated forfeitures. The Company uses the Black-Scholes option-pricing model to estimate the fair value of stock options granted, which requires the input of both subjective and objective assumptions as follows: Expected Term — The estimate of expected term is based on the historical exercise behavior of grantees, as well as the contractual life of the option grants. Expected Volatility — The expected volatility factor is based on the historical volatility of the Company's common stock for a period equal to the expected term of the stock option. Risk-free Interest Rate — The risk-free interest rate is determined using the implied yield for a traded zero-coupon U.S. Treasury bond with a term equal to the expected term of the stock option. Expected Dividend Yield — The expected dividend yield is based on the Company's historical practice of not paying dividends on its common stock. The Company’s weighted-average assumptions used to estimate the fair value of stock options granted during the fiscal years presented were as follows: Fiscal Years Ended July 25, July 26, July 27, Expected term (years) 3.9 3.9 3.9 Expected volatility 38.8 % 40.0 % 41.6 % Risk-free interest rate 1.8 % 1.5 % 0.7 % Expected dividend yield — % — % — % Weighted-average grant date fair value $ 4.97 $ 7.11 $ 7.29 A summary of the stock option activity under all plans during Fiscal 2015 is as follows: Number of Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Terms Aggregate Intrinsic Value (a) (thousands) (years) (millions) Options outstanding – July 26, 2014 12,714.4 $ 14.04 5.6 $ 45.7 Granted 3,287.4 14.08 Exercised (908.1 ) 9.21 Canceled/Forfeited (989.8 ) 17.26 Options outstanding – July 25, 2015 14,103.9 $ 14.13 5.1 $ 17.3 Options vested and expected to vest at July 25, 2015 (b) 13,755.8 $ 14.49 5.1 $ 17.3 Options exercisable at July 25, 2015 7,958.3 $ 12.25 4.3 $ 17.2 ______ (a) The intrinsic value is the amount by which the market price at the end of the period of the underlying share of stock exceeds the exercise price of the stock option. (b) The number of options expected to vest takes into consideration estimated expected forfeitures. As of July 25, 2015, there was $24.3 million of total unrecognized compensation cost related to non-vested options, which is expected to be recognized over a remaining weighted-average vesting period of 2.5 years . The total intrinsic value of options exercised during Fiscal 2015, Fiscal 2014 and Fiscal 2013 was approximately $5.0 million , $17.1 million and $44.5 million , respectively. The total fair value of options that vested during Fiscal 2015, Fiscal 2014 and Fiscal 2013, was approximately $14.2 million , $14.1 million , and $11.8 million , respectively. Restricted Equity Awards The 2010 Stock Plan also allows for the issuance of shares of restricted stock and restricted stock units (“RSUs”). Any shares of restricted stock or RSUs are counted against the shares available for future grant limit as 2.3 shares for every one restricted share or RSU granted. In general, if options are canceled for any reason or expire, the shares covered by such options again become available for grant. If a share of restricted stock or a RSU is forfeited for any reason, 2.3 shares become available for grant. Shares of restricted stock and RSUs are issued with either service-based or performance-based conditions, and some even have market-based conditions (collectively, “Restricted Equity Awards”). Service-based Restricted Equity Awards entitle the holder to receive unrestricted shares of common stock of the Company at the end of a vesting period, subject to the grantee’s continuing employment. Service-based Restricted Equity Awards generally vest over a four year period of time. Performance-based or market-based Restricted Equity Awards also entitle the holder to receive shares of common stock of the Company at the end of a vesting period. However, such awards are subject to (a) the grantee’s continuing employment, (b) the Company’s achievement of certain performance goals over a pre-defined performance period and (c) in the case of market-based conditions, the Company’s achievement of certain market-based goals over the pre-defined performance period. Both performance-based and market-based Restricted Equity Awards generally vest at the completion of the performance period. The fair values of both service-based and performance-based Restricted Equity Awards are based on the fair value of the Company’s unrestricted common stock at the date of grant. However, for market-based Restricted Equity Awards, the effect of the market conditions is reflected in the fair value of the awards on the date of grant using a Monte-Carlo simulation model. A Monte-Carlo simulation model estimates the fair value of the market-based award based on the expected term, risk-free interest rate, expected dividend yield and expected volatility measure for the Company and its peer group. Compensation expense for both service-based and performance-based Restricted Equity Awards is recognized over the vesting period based on the grant-date fair values of the awards that are expected to vest based upon the service and performance-based conditions. However, compensation expense for market-based Restricted Equity Awards is recognized over the vesting period regardless of whether the market conditions are expected to be achieved. A summary of Restricted Equity Awards activity during Fiscal 2015 is as follows: Service-based Restricted Equity Awards Performance-based Restricted Equity Awards Market-based Restricted Equity Awards Number of Shares Weighted- Average Grant Date Fair Value Per Share Number of Shares Weighted- Average Grant Date Fair Value Per Share Number of Shares Weighted- Average Grant Date Fair Value Per Share (thousands) (thousands) (thousands) Nonvested at July 26, 2014 1,247.7 $ 17.66 662.1 $ 17.18 176.6 $ 16.68 Granted 506.5 13.96 164.0 13.75 61.0 13.34 Vested (451.1 ) 17.33 (109.1 ) 12.91 — — Canceled/Forfeited (201.2 ) 17.49 (267.9 ) 16.80 (52.8 ) 12.25 Nonvested at July 25, 2015 1,101.9 $ 16.13 449.1 $ 17.20 184.8 $ 16.84 Service-based Restricted Equity Awards Performance-based Restricted Equity Awards Market-based Restricted Equity Awards Total unrecognized compensation at July 25, 2015 (millions) $ 8.5 $ 1.5 $ 0.9 Weighted-average years expected to be recognized over (years) 3.0 1.9 1.7 Additional information pertaining to Restricted Equity Awards activity is as follows: Fiscal Years Ended July 25, July 26, July 27, Service-based Restricted Equity Awards: Weighted-average grant date fair value of awards granted $ 13.96 $ 19.23 $ 20.22 Total fair value of awards vested (millions) 7.1 12.9 10.0 Performance-based Restricted Equity Awards: Weighted-average grant date fair value of awards granted $ 13.75 $ 20.06 $ 18.61 Total fair value of awards vested (millions) 1.4 2.6 — Market-based Restricted Equity Awards: Weighted-average grant date fair value of awards granted $ 13.34 $ 19.46 $ 18.13 Total fair value of awards vested (millions) — 0.6 — Cash-Settled Long-Term Incentive Plan Awards Cash-Settled LTIP Awards are stock-settled awards that entitle the holder to a cash payment equal to the value of the number of shares of the Company’s common stock earned at the end of a three -year performance period and are subject to (a) the grantee’s continuing employment and (b) the Company’s achievement of certain performance goals over that three year performance period. Compensation expense for the Cash-Settled LTIP Awards is recognized over the related vesting periods based on the expected performance of the plan and changes in the Company's stock price over time. A summary of Cash-Settled LTIP Awards activity during Fiscal 2015 is as follows: Cash-Settled LTIP Awards Number of Shares (thousands) Nonvested at July 26, 2014 858.0 Granted 809.4 Vested (107.5 ) Canceled/Forfeited (282.0 ) Nonvested at July 25, 2015 1,277.9 As of July 25, 2015, there was $4.1 million of total unrecognized compensation cost related to Cash-Settled LTIP Awards, which is expected to be recognized over a remaining weighted-average vesting period of 2.0 years . As of July 25, 2015, the liability for Cash-Settled LTIP Awards was $1.9 million , of which $0.2 million was classified within Accrued expenses and other current liabilities and $1.7 million was classified within Other non-current liabilities in the accompanying consolidated balance sheets. As of July 26, 2014, the liability for Cash-Settled LTIP Awards was $5.3 million , of which $1.8 million was classified within Accrued expenses and other current liabilities and $3.5 million was classified within Other non-current liabilities in the accompanying consolidated balance sheets. The Company paid $1.6 million and $6.2 million to settle such liabilities during Fiscal 2015 and Fiscal 2014, respectively. |
Segments
Segments | 12 Months Ended |
Jul. 25, 2015 | |
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] | |
Segments | Segments The Company’s segment reporting structure reflects a brand-focused approach, designed to optimize the operational coordination and resource allocation of its businesses across multiple functional areas including specialty retail, ecommerce and licensing. The five reportable segments described below represent the Company’s brand-based activities for which separate financial information is available and utilized on a regular basis by the Company’s executive team to evaluate performance and allocate resources. In identifying reportable segments and disclosure of product offerings, the Company considers economic characteristics, as well as products, customers, sales growth potential and long-term profitability. As such, the Company reports its operations in five reportable segments as follows: • Justice segment – consists of the specialty retail, outlet, ecommerce and licensing operations of the Justice brand. • Lane Bryant segment – consists of the specialty retail, outlet and ecommerce operations of the Lane Bryant and Cacique brands. • maurices segment – consists of the specialty retail, outlet and ecommerce operations of the maurices brand. • dressbarn segment – consists of the specialty retail, outlet and ecommerce operations of the dressbarn brand. • Catherines segment - consists of the specialty retail and ecommerce operations of the Catherines brand. The accounting policies of the Company’s reporting segments are consistent with those described in Notes 2 and 3. All intercompany revenues are eliminated in consolidation. Corporate overhead expenses are allocated to the segments based upon specific usage or other reasonable allocation methods. Net sales and operating (loss) income for each segment are as follows: Fiscal Years Ended July 25, 2015 July 26, 2014 July 27, 2013 Net sales: (millions) Justice $ 1,276.8 $ 1,384.3 $ 1,407.4 Lane Bryant 1,095.9 1,080.0 1,050.1 maurices 1,060.6 971.4 917.6 dressbarn 1,023.6 1,022.5 1,020.7 Catherines 346.0 332.4 319.1 Total net sales $ 4,802.9 $ 4,790.6 $ 4,714.9 Operating (loss) income: Justice $ (62.8 ) $ 99.3 $ 182.3 Lane Bryant (308.0 ) (4.3 ) (30.1 ) maurices 125.9 86.0 107.0 dressbarn 10.7 39.4 30.3 Catherines 31.0 24.4 10.4 Unallocated acquisition and integration expenses (31.7 ) (34.0 ) (34.6 ) Total operating (loss) income $ (234.9 ) $ 210.8 $ 265.3 Depreciation and amortization expense and capital expenditures for each segment are as follows: Fiscal Years Ended July 25, 2015 July 26, 2014 July 27, 2013 Depreciation and amortization expense: (millions) Justice $ 70.2 $ 60.7 $ 56.3 Lane Bryant 46.8 45.6 43.7 maurices 43.3 39.5 31.5 dressbarn 50.7 40.5 38.5 Catherines 7.2 7.3 6.0 Total depreciation and amortization expense $ 218.2 $ 193.6 $ 176.0 Capital expenditures (a) : Justice $ 51.5 $ 93.5 $ 65.9 Lane Bryant 47.9 53.5 49.1 maurices 56.3 54.0 45.1 dressbarn 47.6 93.5 50.3 Catherines 6.2 7.3 2.7 Corporate (b) 103.0 175.7 77.8 Total capital expenditures $ 312.5 $ 477.5 $ 290.9 (a) Excludes ending accrued capital expenditures of $50.8 million in Fiscal 2015, $64.4 million in Fiscal 2014 and $58.9 million in Fiscal 2013. (b) Includes capital expenditures for technological and supply chain infrastructure and corporate office space. Total assets for each segment consist of the following: July 25, 2015 July 26, 2014 Assets: (millions) Justice $ 826.8 $ 858.3 Lane Bryant (a) 597.3 866.4 maurices 562.2 535.5 dressbarn 336.1 358.2 Catherines 98.9 86.6 Corporate ( b ) 494.4 418.8 Total assets $ 2,915.7 $ 3,123.8 _______ (a) The decrease is primarily due to the impairment losses related to Lane Bryant 's goodwill of $261.7 million and trade name of $44.7 million . (b) Includes assets specifically identified as Corporate assets, principally cash, and corporate fixed assets as discussed above. The Company’s operations are largely concentrated in the United States and Canada. Accordingly, net sales and long-lived assets by geographic location are not meaningful at this time. The Company’s revenues by major product categories as a percentage of total net sales are as follows: Fiscal Years Ended July 25, 2015 July 26, 2014 July 27, 2013 (millions) Apparel 84 % 83 % 83 % Accessories and other 16 % 17 % 17 % Total net sales 100 % 100 % 100 % |
Additional Financial Informatio
Additional Financial Information | 12 Months Ended |
Jul. 25, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Additional Financial Information | Additional Financial Information Fiscal Years Ended Cash Interest and Taxes: July 25, 2015 July 26, 2014 July 27, 2013 (millions) Cash paid for interest $ 4.6 $ 4.6 $ 15.6 Cash (received) paid for income taxes $ (5.9 ) $ 42.1 $ 19.7 Non-cash Transactions Non-cash investing activities include the accrued purchases of fixed assets in the amount of $50.8 million as of July 25, 2015, $64.4 million as of July 26, 2014 and $58.9 million as of July 27, 2013. |
Subsequent Events Subsequent Ev
Subsequent Events Subsequent Events | 12 Months Ended |
Jul. 25, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On August 21, 2015, the Company completed the acquisition of ANN, INC. (" ANN ") for an aggregate purchase price of approximately $2.1 billion , excluding transaction costs (the "ANN Acquisition"). The purchase price consisted of approximately $1.75 billion in cash and the issuance of 31.2 million shares of the Company's common stock valued at approximately $345 million , based on the ascena stock price on the date of acquisition. The cash portion of the purchase price was funded with new borrowings under a $1.8 billion seven-year, variable-rate term loan described below. The Company will account for the ANN Acquisition under the purchase method of accounting for business combinations. Accordingly, the cost to acquire such assets will be allocated to the underlying net assets in proportion to estimates of their respective fair values. Any excess of the purchase price over the estimated fair value of the net assets acquired will be recorded as goodwill. Since the closing date of the acquisition occurred subsequent to the end of Fiscal 2015, the allocation of the purchase price to the underlying net assets has not yet been completed. The Company will reflect the preliminary valuation of the net assets acquired in its financial statements for the first quarter of Fiscal 2016. The operational results of ANN will be consolidated in the Company’s first quarter of Fiscal 2016 operational results from August 21, 2015, the effective date of the ANN Acquisition. The purchase price excluded transaction costs of $7.0 million incurred by the Company in Fiscal 2015 which were expensed as incurred and recorded as Acquisition and integration expenses in the accompanying consolidated statements of operations. Additionally, the Company expects to incur transaction costs of approximately $25 million after July 25, 2015 which will be expensed as incurred during the first quarter of Fiscal 2016. Amended Revolving Credit Agreement In August 2015, in connection with the ANN Acquisition, the Company and certain of its domestic subsidiaries amended the Revolving Credit Agreement (the “Amended Revolving Credit Agreement”). The Amended Revolving Credit Agreement increased the aggregate revolving commitments from $500 million to $600 million , with an optional increase of up to $200 million and extended the maturity date to August 2020. There are no mandatory reductions in aggregate revolving commitments throughout the term of the Amended Revolving Credit Agreement. However, borrowing availability under the Amended Revolving Credit Agreement (the "Availability") is limited by the amount of eligible inventory and receivables as defined in the Amended Revolving Credit Agreement. The Amended Revolving Credit Agreement may be used for the issuance of letters of credit, to fund working capital requirements and capital expenditures and for general corporate purposes. The Amended Revolving Credit Agreement includes a $350 million letter of credit sublimit, of which $100 million can be used for standby letters of credit, and a $30 million swing loan sublimit. Throughout the term of the Amended Revolving Credit Agreement, the Company can elect to borrow either Alternative Base Rate Borrowings ("ABR Borrowings") or Eurodollar Borrowings. Eurodollar Borrowings bear interest at a variable rate using the LIBOR for such Interest Period plus an applicable margin ranging from 125 basis points to 150 basis points based on the Company’s average availability during the previous fiscal quarter. ABR Borrowings bear interest at a variable rate determined using a base rate equal to the greatest of (i) prime rate, (ii) federal funds rate plus 50 basis points, or (iii) one-month LIBOR plus 100 basis points; plus an applicable margin ranging from 25 basis points to 50 basis points based on the average availability during the previous fiscal quarter. Under the terms of the Amended Revolving Credit Agreement, the unutilized commitment fee ranges from 20 basis points to 25 basis points per annum based on the Company's average utilization during the previous fiscal quarter. Term Loan Also in connection with the ANN Acquisition, the Company entered into a $1.8 billion variable-rate term loan (the "Term Loan"), which provides for an additional term facility of $200 million plus, as long as the Company maintains a minimum senior secured leverage ratio as defined in the Term Loan (the "Senior Secured Leverage Ratio") and among other factors, an unlimited amount. The Term Loan matures on August 21, 2022, and has mandatory quarterly repayments of $4.5 million in calendar 2016 and $22.5 million thereafter, with a remaining balloon payment of approximately $1.3 billion required at maturity. The Company is also required to make mandatory prepayments in connection with certain prepayment events, including (i) commencing with the fiscal year ending July 29, 2017 if the Company has excess cash flow, as defined in the Term Loan, for any fiscal year and the Senior Secured Leverage Ratio for such fiscal year exceeds certain predetermined limits and (ii) from Net Proceeds, as defined in the Term Loan , of asset dispositions and certain casualty events that are greater than $25 million in the aggregate in any fiscal year and not reinvested (or committed to be reinvested) within one year, in each case subject to certain conditions and exceptions. The Company has the right to prepay the Term Loan in any amount and at any time with no prepayment penalties, provided that any prepayment made prior to August 21, 2016 with the proceeds of certain repricing events will be subject to a premium equal to 1% of the aggregate principal amount of the Term Loan repaid. At the time of initial borrowings and renewal periods throughout the term of the Term Loan, the Company may elect to borrow either ABR Borrowings or Eurodollar Borrowings. Eurodollar Borrowings bear interest at a variable rate using LIBOR (subject to a 75 basis point floor) plus an applicable margin of 450 basis points. ABR Borrowings bear interest at a variable rate determined using a base rate (subject to a floor of 175 basis points) equal to the greatest of (i) prime rate, (ii) federal funds rate plus 50 basis points, or (iii) LIBOR plus 100 basis points, plus an applicable margin of 350 basis points. The original issue discount of the Term Loan was $36.0 million and will be amortized into interest expense. Restrictions under the Term Loan and the Amended Revolving Credit Agreement (collectively the "Borrowing Agreements") Under the Amended Revolving Credit Agreement, the Company is required to maintain a fixed charge coverage ratio, as defined in the Amended Revolving Credit Agreement, of at least 1.00 to 1.00 any time in which the Company is in a covenant period, as defined in the Amended Revolving Credit Agreement (the "Covenant Period"). Such Covenant Period is in effect if Availability is less than the greater of (a) 10% of the Credit Limit (the lesser of total Revolving Commitments and the Borrowing Base) and (b) $45 million for three consecutive business days and ends when Availability is greater than these thresholds for 30 consecutive days. The Borrowing Agreements contain customary negative covenants, subject to negotiated exceptions, on (i) liens and guarantees, (ii) investments, (iii) indebtedness, (iv) significant corporate changes including mergers and acquisitions, (v) dispositions, (vi) restricted payments, cash dividends, stock repurchase and certain other restrictive agreements. The borrowing agreements also contain customary events of default, such as payment defaults, cross-defaults to certain material indebtedness, bankruptcy and insolvency, the occurrence of a defined change in control, or the failure to observe the negative covenants and other covenants related to the operation of the Company’s business, in each case subject to customary grace periods. The Company's Amended Revolving Credit Agreement allows us to pay dividends, provided that at the time of and immediately after giving effect to the dividend, (i) there is no default or event of default, and (ii) Availability is not less than 20% of the aggregate revolving commitments, subject to a maximum predetermined limit. The Company's Term Loan allows us to pay dividends, provided that at the time of and immediately after giving effect to the dividend, (i) there is no default or event of default, and (ii) total leverage ratio, as defined in the Term Loan, after giving effect to such dividend, is above predetermined limits. Dividends are payable when declared by our Board of Directors. The Company’s obligations under the Borrowing Agreements are guaranteed by certain of its domestic subsidiaries (the “Subsidiary Guarantors”). As collateral under the borrowing agreements and the guarantees thereof, the Company and the Subsidiary Guarantors have granted to the administrative agents for the benefit of the lenders, a first priority lien on substantially all of their tangible and intangible assets, including, without limitation, certain domestic inventory and certain material real estate. |
Basis of Presentation Basis of
Basis of Presentation Basis of Presentation (Policies) | 12 Months Ended |
Jul. 25, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Consolidation | The consolidated financial statements are prepared in accordance with United States Generally Accepted Accounting Principles (“US GAAP”), and present the financial position, operational results, comprehensive (loss) income and cash flows of the Company and its subsidiaries which are 100% owned. All significant intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and footnotes thereto. Actual results could differ materially from those estimates. Significant estimates inherent in the preparation of the consolidated financial statements include: the realizability of inventory; reserves for litigation and other contingencies; useful lives and impairments of long-lived tangible assets, goodwill and other intangible assets; accounting for income taxes and related uncertain tax positions; the valuation of stock-based compensation and related expected forfeiture rates; and its self-insured insurance reserves. |
Fiscal Year | The Company utilizes a 52-53 week fiscal year ending on the last Saturday in July. As such, fiscal year 2015 ended on July 25, 2015 and reflected a 52-week period (“Fiscal 2015"); fiscal year 2014 ended on July 26, 2014 and reflected a 52-week period (“Fiscal 2014"); and fiscal year 2013 ended on July 27, 2013 and reflected a 52-week period (“Fiscal 2013”). |
Discontinued Operations | On June 14, 2012, the Company acquired the Fashion Bug and Figi’s businesses in connection with the acquisition of the Lane Bryant and Catherines businesses. Contemporaneously with the acquisition of those businesses, the Company announced its intent to cease operating the acquired Fashion Bug business. |
Summary of Significant Accoun30
Summary of Significant Accounting Policies (Policy) | 12 Months Ended |
Jul. 25, 2015 | |
Accounting Policies [Abstract] | |
Revenue Recognition | Revenue is recognized when there is persuasive evidence of an arrangement, delivery has occurred, price has been fixed or is determinable and collectability is reasonably assured. Retail store revenue is recognized net of estimated returns at the time of sale to consumers. Ecommerce revenue from sales of products ordered through the Company’s retail Internet sites and revenue from direct-mail orders through Justice’s catazine are recognized upon delivery and receipt of the shipment by our customers. Such revenue also is reduced by an estimate of returns. Reserves for estimated product returns are recorded based on historical return trends and are adjusted for known events, as applicable. Reserves for estimated product returns were $9.2 million and $7.7 million as of the end of Fiscal 2015 and Fiscal 2014, respectively. Gift cards, gift certificates and merchandise credits (collectively, “gift cards”) issued by the Company are recorded as a deferred income liability until they are redeemed, at which point revenue is recognized. Gift cards do not have expiration dates. The Company recognizes income for unredeemed gift cards when the likelihood of a gift card being redeemed by a customer is remote and the Company determines that it does not have a legal obligation to remit the value of the unredeemed gift card to the relevant jurisdiction as unclaimed or abandoned property. Gift card breakage is included in Net sales in the accompanying consolidated statements of operations and historically has not been material. Revenue associated with merchandise shipments to other third-party retailers is recognized at the time title passes and risk of loss is transferred to customers, which generally occurs at the date of shipment. In addition to retail-store, ecommerce and third party sales, the Justice segment recognizes revenue from (i) licensing arrangements with franchised stores, (ii) advertising and other “tween-right” marketing arrangements with partner companies, (iii) royalty payments received under license agreements for the use of the Justice trade name and (iv) amounts received in connection with advertising and marketing arrangements with partner companies when they are earned in accordance with the terms of the underlying agreements. The Company accounts for sales and other related taxes on a net basis, thereby excluding such taxes from revenue. |
Cost of Goods Sold | Cost of goods sold (“COGS”) consists of all costs of merchandise (net of purchase discounts and vendor allowances), merchandise acquisition costs (primarily commissions and import fees) and freight to our distribution centers and stores. These costs are determined to be directly or indirectly incurred in bringing an article to its existing condition and location. Additionally, the direct costs associated with shipping goods to customers and adjustments to the carrying value of inventory related to realizability and shrinkage are recorded as a component of Cost of goods sold. Our Cost of goods sold and Gross margin may not be comparable to those of other entities. Some entities, like us, exclude costs related to their distribution network, buying function, store occupancy costs and depreciation and amortization expenses from Cost of goods sold and include them in other operating expenses, whereas other entities include these costs in their Cost of goods sold. |
Buying, Distribution and Occupancy Costs | Buying, distribution and occupancy expenses consist of store occupancy and utility costs (excluding depreciation), fulfillment expense (as defined below) and all costs associated with the buying and distribution functions. |
Selling, General and Administrative Expenses | Selling, general and administrative expenses (“SG&A expenses”) consist of compensation and benefit-related costs for sales and store operations personnel, administrative personnel and other employees not associated with the functions described above under Buying, distribution and occupancy expenses. SG&A expenses also include advertising and marketing costs, information technology and communication costs, supplies for our stores and administrative facilities, insurance costs, legal costs and costs related to other administrative services. |
Business Acquisition, Integration, Restructuring and Other Related Costs [Text Block] | Acquisition and Integration Expenses Acquisition and integration expenses consist of transaction expenses representing legal, consulting and investment banking-related costs that are direct, incremental costs incurred prior to the closing of an acquisition and costs incurred to integrate the operations of newly acquired businesses into the Company's existing infrastructure as well as other initiatives to combine the newly merged companies into new infrastructure. |
Shipping and Fulfillment | Shipping and fulfillment fees billed to customers are recorded as revenue. The direct costs associated with shipping goods to customers are recorded as a component of Cost of goods sold. Costs associated with preparing the merchandise for shipping, such as picking, packing, warehousing, and order charges ("fulfillment expense") are recorded as a component of Buying, distribution and occupancy expenses. |
Marketing and Advertising Costs | Marketing and advertising costs are included in SG&A expenses. Marketing and advertising costs are expensed when the advertisement is first exhibited. Marketing and advertising expenses were $176.7 million for Fiscal 2015, $160.1 million for Fiscal 2014 and $169.1 million for Fiscal 2013. Deferred marketing and advertising costs, which principally relate to advertisements that have not yet been exhibited or services that have not yet been received, were not material at the end of either Fiscal 2015 or Fiscal 2014. |
Foreign Currency Translation and Transactions | The operating results and financial position of foreign operations are consolidated using the local currency as the functional currency. Local currency assets and liabilities are translated at the rates of exchange on the balance sheet date, and local currency revenues and expenses are translated at average rates of exchange during the period. The resulting translation gains or losses are included in the consolidated statements of comprehensive (loss) income, and in the consolidated statements of equity as a component of accumulated other comprehensive (loss) income (“AOCI”). Gains and losses on the translation of intercompany loans made to foreign subsidiaries that are of a long-term investment nature also are included within AOCI. The Company recognizes gains and losses on transactions that are denominated in a currency other than the respective entity's functional currency. Foreign currency transaction gains and losses also result from intercompany loans made to foreign subsidiaries that are not of a long-term investment nature and include amounts realized on the settlement of certain intercompany loans with foreign subsidiaries. Net losses from foreign currency transactions amounted to $0.9 million in Fiscal 2015 and $1.6 million in Fiscal 2014. Such amounts are recognized in earnings and included as part of Interest income and other income (expense), net in the accompanying consolidated statements of operations. |
Stock-Based Compensation | The Company expenses stock-based compensation to employees and non-employee directors based on the grant date fair value of the awards over the requisite service period, adjusted for estimated forfeitures. The Company uses the Black-Scholes valuation method to determine the grant date fair value of its option-based compensation. Shares of restricted stock and restricted stock units are issued with either service-based or performance-based conditions, and some also have market-based conditions (collectively, “Restricted Equity Awards”). Compensation expense for both service-based and performance-based Restricted Equity Awards is recognized over the vesting period based on the grant-date fair values of the awards that are expected to vest based upon the service and performance-based conditions. However, compensation expense for market-based Restricted Equity Awards is recognized over the vesting period regardless of whether the market conditions are expected to be achieved. Compensation expense for cash-settled long-term incentive plan awards (the “Cash-Settled LTIP Awards”) is recognized over the related vesting period based on the expected performance of the plan and changes in the Company’s stock price over time. See Note 16 for further discussion of the Company's stock-based compensation plans. |
Cash and Cash Equivalents | Cash and cash equivalents include all highly liquid investments with original maturities of 90 days or less and receivables from financial institutions related to credit card purchases due to the high credit quality and short time frame for settlement of the outstanding amounts. |
Concentration of Credit Risk | The Company maintains cash deposits and cash equivalents with well-known and stable financial institutions; however, there were significant amounts of cash and cash equivalents at these financial institutions in excess of federally insured limits at July 25, 2015. |
Inventories | We hold inventory for sale through our retail stores and ecommerce sites. Inventory is valued using the retail method of accounting and is stated at the lower of cost, on a First In, First Out (“FIFO”) basis, or market. Under the retail inventory method, the valuation of inventory at cost and resulting gross margin are calculated by applying a calculated cost to retail ratio to the retail value of inventory. Inherent in the retail method are certain significant management judgments and estimates including, among others, initial merchandise markup, markdowns and shrinkage, which significantly impact the ending inventory valuation at cost as well as the resulting gross margins. The Company continuously reviews its inventory levels to identify slow-moving merchandise and markdowns necessary to clear slow-moving merchandise, which reduces the cost of inventories to its estimated net realizable value. Consideration is given to a number of quantitative and qualitative factors, including current pricing levels and the anticipated need for subsequent markdowns, aging of inventories, historical sales trends, and the impact of market trends and economic conditions. Estimates of markdown requirements may differ from actual results due to changes in quantity, quality and mix of products in inventory, as well as changes in consumer preferences, market and economic conditions. The Company’s historical estimates of these costs and its markdown provisions have not differed materially from actual results. Reserves for inventory shrinkage, representing the risk of physical loss of inventory, are estimated based on historical experience and are adjusted based upon physical inventory counts. |
Property and Equipment, Net | Property and equipment, net, is stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the following estimated useful lives: Buildings and improvements 10-40 years Distribution center equipment and machinery 3-20 years Leasehold improvements Shorter of the useful life or expected term of the lease Furniture, fixtures, and equipment 2-10 years Information technology 3-10 years Certain costs associated with computer software developed or obtained for internal use are capitalized, including internal costs. The Company capitalizes certain costs for employees that are directly associated with internal use computer software projects once specific criteria are met. Costs are expensed for preliminary stage activities, training, maintenance and all other post-implementation stage activities as they are incurred. Property and equipment, along with other long-lived assets, are evaluated for impairment periodically whenever events or changes in circumstances indicate that their related carrying amounts may not be recoverable. In evaluating long-lived assets for recoverability, including finite-lived intangible assets as described below, the Company uses its best estimate of future cash flows expected to result from the use of the asset and its eventual disposition. To the extent that estimated future undiscounted net cash flows attributable to the asset are less than the carrying amount, an impairment loss is recognized equal to the difference between the carrying value of such asset and its fair value, considering external market participant assumptions. Assets to be disposed of and for which there is a committed plan of disposal are reported at the lower of carrying value or fair value less costs to sell. |
Goodwill and Other Intangible Assets, Net | At acquisition, the Company estimates and records the fair value of purchased intangible assets, which primarily consist of certain trade names, proprietary software and franchise rights. The fair value of these intangible assets is estimated based on management's assessment, considering independent third-party appraisals, when necessary. The excess of the purchase consideration over the fair value of net assets acquired is recorded as goodwill. Goodwill and certain other intangible assets deemed to have indefinite useful lives, including trade names and certain franchise rights, are not amortized. Rather, goodwill and such indefinite-lived intangible assets are assessed for impairment at least annually based on comparisons of their respective fair values to their carrying values. Goodwill impairment is determined using a two-step process. The first step of the goodwill impairment test is to identify potential impairment by comparing the fair value of a reporting unit with its net book value (or carrying amount), including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not to be impaired and performance of the second step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The second step of the goodwill impairment test compares the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit's goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination. That is, the fair value of the reporting unit is allocated to all of the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value was the purchase price paid to acquire the reporting unit. The impairment test for other indefinite-lived intangible assets consists of a comparison of the fair value of the intangible asset with its carrying value. The fair value of indefinite-lived intangible assets is primarily determined using the relief from royalty approach. If the carrying value of the indefinite-lived intangible asset exceeds its fair value, an impairment loss is recognized equal to the excess. In addition, in evaluating finite-lived intangible assets for recoverability, we use our best estimate of future cash flows expected to result from the use of the asset and eventual disposition. To the extent that estimated future undiscounted net cash flows attributable to the asset are less than the carrying amount, an impairment loss is recognized equal to the difference between the carrying value of such asset and its fair value. The Company performs its annual impairment assessment of goodwill and indefinite lived intangible assets using a quantitative approach during the fourth quarter of each fiscal year. During Fiscal 2015, the Company changed the date of its annual impairment assessment from the last day of the second month of its fiscal fourth quarter to the first day of its fiscal fourth quarter. The change in date had no impact on our Fiscal 2015 annual impairment test as both the new and the old testing dates are within the same fiscal quarter. The change in the assessment date was made to allow for more time to perform the annual impairment assessment before the Company's fiscal year-end. See Note 8 for additional discussion of the Company’s goodwill and other intangible assets and a discussion of the results of the annual assessment of goodwill and indefinite-lived intangible assets, including related impairment charges. Finite-lived intangible assets are amortized over their respective estimated useful lives and, along with other long-lived assets (as discussed above), are evaluated for impairment periodically whenever events or changes in circumstances indicate that their related carrying amounts may not be recoverable. Refer to the Company's accounting policy for long-lived asset impairment as described earlier under the caption "Property and Equipment, Net." |
Insurance Reserves | The Company uses a combination of insurance and self-insurance mechanisms to provide for the potential liabilities for workers’ compensation and employee healthcare benefits. Liabilities associated with these risks are estimated, in part, by considering historical claims experience, demographic factors, severity factors and other actuarial assumptions. Such liabilities are capped through the use of stop loss contracts with insurance companies. The estimated accruals for these liabilities could be significantly affected if future occurrences and claims differ from these assumptions and historical trends. As of July 25, 2015 and July 26, 2014, these reserves were $48.5 million and $52.9 million , respectively. The Company is subject to various claims and contingencies related to insurance and other matters arising out of the normal course of business. The Company is self-insured for expenses related to its employee medical and dental plans, and its workers’ compensation plan, up to certain thresholds. Claims filed, as well as claims incurred but not reported, are accrued based on management’s estimates, using information received from plan administrators, historical analysis and other relevant data. The Company’s stop-loss insurance coverage limit for individual claims under these policies is $350,000 . The Company believes its accruals for claims and contingencies are adequate based on information currently available. However, it is possible that actual results could differ significantly from the recorded accruals for claims and contingencies. |
Income Taxes | Income taxes are provided using the asset and liability method. Under this method, income taxes (i.e., deferred tax assets and liabilities, current taxes payable/refunds receivable and tax expense) are recorded based on amounts refundable or payable in the current year, and include the results of any differences between US GAAP and tax reporting. Deferred income taxes reflect the tax effect of certain net operating loss, capital loss and general business credit carry forwards and the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial statement and income tax purposes, as determined under enacted tax laws and rates. The Company accounts for the financial effect of changes in tax laws or rates in the period of enactment. In addition, valuation allowances are established when management determines that it is more-likely-than-not that some portion or all of a deferred tax asset will not be realized. Tax valuation allowances are analyzed periodically and adjusted as events occur, or circumstances change, that warrant adjustments to those balances. In determining the income tax provision for financial reporting purposes, the Company establishes a reserve for uncertain tax positions. If the Company considers that a tax position is “more-likely-than-not” of being sustained upon audit, based solely on the technical merits of the position, it recognizes the tax benefit. The Company measures the tax benefit by determining the largest amount that is greater than 50% likely of being realized upon settlement, presuming that the tax position is examined by the appropriate taxing authority that has full knowledge of all relevant information. These assessments can be complex and the Company often obtains assistance from external advisors. To the extent that the Company’s estimates change or the final tax outcome of these matters is different than the amounts recorded, such differences will impact the income tax provision in the period in which such determinations are made. If the initial assessment fails to result in the recognition of a tax benefit, the Company regularly monitors its position and subsequently recognizes the tax benefit if (i) there are changes in tax law or analogous case law that sufficiently raise the likelihood of prevailing on the technical merits of the position to “more-likely-than-not,” (ii) the statute of limitation expires, or (iii) there is a completion of an audit resulting in a settlement of that tax year with the appropriate agency. Uncertain tax positions are classified as current only when the Company expects to pay cash within the next twelve months. Interest and penalties, if any, are recorded within the provision for income taxes in the Company’s accompanying consolidated statements of operations and are classified on the accompanying consolidated balance sheets with the related liability for uncertain tax positions. |
Leases | The Company leases certain facilities and equipment, including its retail stores. Most of the Company's leases contain renewal options, rent escalation clauses and/or landlord incentives. Rent expense for non-cancelable operating leases with scheduled rent increases and/or landlord incentives is recognized on a straight-line basis over the lease term, beginning with the effective lease commencement date. The effective lease commencement date represents the date on which the Company takes possession of, or controls the physical use of, the leased property. The excess of straight-line rent expense over scheduled payment amounts and landlord incentives is recorded as a deferred rent liability and is classified on the consolidated balance sheets within Lease-related liabilities. Certain leases provide for contingent rents, which are determined as a percentage of gross sales in excess of specified levels. A contingent rent liability is recognized together with the corresponding rent expense when specified levels have been achieved or when management determines that achieving the specified levels during the fiscal year is probable. |
Summary of Significant Accoun31
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Jul. 25, 2015 | |
Accounting Policies [Abstract] | |
Property, Plant and Equipment [Table Text Block] | Depreciation is calculated using the straight-line method over the following estimated useful lives: Buildings and improvements 10-40 years Distribution center equipment and machinery 3-20 years Leasehold improvements Shorter of the useful life or expected term of the lease Furniture, fixtures, and equipment 2-10 years Information technology 3-10 years Property and equipment, net, consist of the following: July 25, 2015 July 26, 2014 (millions) Property and Equipment: Land $ 30.4 $ 33.1 Buildings and improvements 189.3 177.9 Leasehold improvements 652.7 604.0 Furniture, fixtures and equipment 572.7 545.7 Information technology (a) 356.2 237.3 Construction in progress (a) 148.6 156.8 1,949.9 1,754.8 Less: accumulated depreciation (779.9 ) (644.2 ) Property and equipment, net $ 1,170.0 $ 1,110.6 (a) Investments in our point-of-sale and merchandising systems that were placed in service during Fiscal 2015 are included in Information technology and were included within construction in progress in Fiscal 2014. Investments related to the development of our ecommerce platforms and costs associated with the construction of a new headquarters building for maurices and certain shared services operations in Duluth, MN are included within Construction in process in Fiscal 2015. |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Jul. 25, 2015 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories by Brand | Inventory by brand is set forth below: July 25, 2015 July 26, 2014 (millions) Justice $ 136.0 $ 198.6 Lane Bryant 126.5 125.6 maurices 103.8 105.5 dressbarn 93.3 97.1 Catherines 29.7 26.4 Total inventories $ 489.3 $ 553.2 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Jul. 25, 2015 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment, Net | Depreciation is calculated using the straight-line method over the following estimated useful lives: Buildings and improvements 10-40 years Distribution center equipment and machinery 3-20 years Leasehold improvements Shorter of the useful life or expected term of the lease Furniture, fixtures, and equipment 2-10 years Information technology 3-10 years Property and equipment, net, consist of the following: July 25, 2015 July 26, 2014 (millions) Property and Equipment: Land $ 30.4 $ 33.1 Buildings and improvements 189.3 177.9 Leasehold improvements 652.7 604.0 Furniture, fixtures and equipment 572.7 545.7 Information technology (a) 356.2 237.3 Construction in progress (a) 148.6 156.8 1,949.9 1,754.8 Less: accumulated depreciation (779.9 ) (644.2 ) Property and equipment, net $ 1,170.0 $ 1,110.6 (a) Investments in our point-of-sale and merchandising systems that were placed in service during Fiscal 2015 are included in Information technology and were included within construction in progress in Fiscal 2014. Investments related to the development of our ecommerce platforms and costs associated with the construction of a new headquarters building for maurices and certain shared services operations in Duluth, MN are included within Construction in process in Fiscal 2015. |
Goodwill and Other Intangible34
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Jul. 25, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in Goodwill for each Reportable Segment | The following details the changes in goodwill for each reportable segment: Justice Lane Bryant maurices dressbarn Catherines Total (millions) Balance at July 27, 2013 $ 103.6 $ 319.1 $ 130.7 $ — $ 28.0 $ 581.4 Acquisition-related activity — — — — — — Balance at July 26, 2014 103.6 319.1 130.7 — 28.0 581.4 Impairment losses (a) — (261.7 ) — — — (261.7 ) Balance at July 25, 2015 $ 103.6 $ 57.4 $ 130.7 $ — $ 28.0 $ 319.7 (a) Represents accumulated impairment losses as of July 25, 2015. |
Other Intangible Assets | Other intangible assets consist of the following: July 25, 2015 July 26, 2014 Description Gross Carrying Amount Accumulated Amortization Net Gross Carrying Amount Accumulated Amortization Net Intangible assets subject to amortization : (millions) Proprietary technology $ 5.8 $ (5.8 ) $ — $ 6.5 $ (5.7 ) $ 0.8 Customer relationships 2.7 (2.7 ) — 2.7 (2.6 ) 0.1 Trade names 5.3 (5.3 ) — 5.3 (3.8 ) 1.5 Total intangible assets subject to amortization 13.8 (13.8 ) — 14.5 (12.1 ) 2.4 Intangible assets not subject to amortization : Brands and trade names (a) 377.4 — 377.4 422.1 — 422.1 Franchise rights 10.9 — 10.9 10.9 — 10.9 Total intangible assets not subject to amortization 388.3 — 388.3 433.0 — 433.0 Total intangible assets $ 402.1 $ (13.8 ) $ 388.3 $ 447.5 $ (12.1 ) $ 435.4 (a) The decrease is due to the impairment loss of $44.7 million recognized for the Lane Bryant trade name in Fiscal 2015. |
Prepaid Expenses and Other Cu35
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Jul. 25, 2015 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consist of the following: July 25, 2015 July 26, 2014 (millions) Prepaid expenses $ 45.6 $ 40.6 Accounts and other receivables 70.8 90.8 Short-term investments 13.4 30.4 Other current assets 1.7 5.0 Total prepaid expenses and other current assets $ 131.5 $ 166.8 |
Accrued Expenses and Other Cu36
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Jul. 25, 2015 | |
Accounts Payable and Accrued Liabilities, Current [Abstract] | |
Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consist of the following: July 25, 2015 July 26, 2014 (millions) Accrued salary, wages and related expenses (a) $ 176.9 $ 120.6 Accrued operating expenses (b) 202.1 164.0 Sales and other taxes payable 14.2 15.7 Other 10.0 8.6 Total accrued expenses and other current liabilities $ 403.2 $ 308.9 (a) The increase is primarily due to the reclassification of approximately $35 million of retirement compensation from Other non-current liabilities to Accrued expenses and other current liabilities during Fiscal 2015, as more fully described in Employment Agreements section in Note 14. (b) The increase is primarily due to the establishment of a legal reserve of approximately $50 million in connection with the Justice pricing lawsuits, as more fully described in Note 14. |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Jul. 25, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Debt consists of the following: July 25, 2015 July 26, 2014 (millions) Revolving credit agreement $ 116.0 $ 172.0 Less: current portion — — Total long-term debt $ 116.0 $ 172.0 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jul. 25, 2015 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign | Domestic and foreign pretax (loss) income from continuing operations are as follows: Fiscal Years Ended July 25, July 26, July 27, (millions) Domestic $ (303.1 ) $ 144.7 $ 189.8 Foreign 62.5 58.8 52.8 Total (loss) income from continuing operations before provision for income taxes $ (240.6 ) $ 203.5 $ 242.6 |
Provisions (Benefits) from Continuing Operations for Current and Deferred Income Taxes | The provision (benefit) from continuing operations for current and deferred income taxes are as follows: Fiscal Years Ended July 25, July 26, July 27, Current: (millions) Federal (a) $ (20.8 ) $ 15.2 $ 30.6 State and local (a) 8.8 13.5 5.7 Foreign 14.8 12.3 10.6 2.8 41.0 46.9 Deferred: Federal 0.9 24.9 38.6 State and local (6.5 ) (0.2 ) 1.4 Foreign (1.0 ) (0.4 ) 0.5 (6.6 ) 24.3 40.5 Total (benefit) provision for income taxes from continuing operations $ (3.8 ) $ 65.3 $ 87.4 (a) Excludes excess tax benefits of approximately $(1.2) million in Fiscal 2015, $4.2 million in Fiscal 2014 and $14.1 million in Fiscal 2013 resulting from stock-based compensation arrangements. Such amounts were recorded within equity. |
Differences Between Income Taxes Expected at U.S. Federal Statutory Income Tax Rate and Income Taxes Provided | The differences between income taxes expected at the U.S. federal statutory income tax rate of 35% and income taxes provided for continuing operations are as set forth below: Fiscal Years Ended July 25, July 26, July 27, (millions) (Benefit) provision for income taxes from continuing operations at the U.S. federal statutory rate $ (84.3 ) $ 71.2 $ 84.9 Increase (decrease) due to: State and local income taxes, net of federal benefit 4.1 8.8 8.4 Tax benefit related to deferred compensation (13.7 ) — — Goodwill impairment 91.6 — — Net change relating to uncertain income tax benefits (0.7 ) (2.3 ) (6.4 ) Indefinitely reinvested foreign earnings 1.7 (11.6 ) (0.9 ) Other – net (2.5 ) (0.8 ) 1.4 Total (benefit) provision for income taxes from continuing operations $ (3.8 ) $ 65.3 $ 87.4 |
Significant Components of Net Deferred Tax Assets (Liabilities) | Significant components of the Company's net deferred tax assets (liabilities) are as follows: July 25, July 26, Deferred tax assets: (millions) Inventories $ 18.7 $ 14.3 Tax credits and net operating loss carryforwards 18.7 14.2 Accrued payroll and benefits 78.3 59.9 Legal reserve 21.0 — Share-based compensation 23.7 23.1 Straight-line rent 45.7 50.0 Federal benefit of uncertain tax positions 14.7 15.5 Other 19.2 18.8 Total deferred tax assets 240.0 195.8 Deferred tax liabilities: Depreciation 113.0 85.8 Amortization 168.6 171.7 Foreign unremitted earnings 32.8 20.7 Other 14.0 15.8 Total deferred tax liabilities 328.4 294.0 Valuation allowance (4.9 ) (2.8 ) Net deferred tax liabilities $ (93.3 ) $ (101.0 ) |
Reconciliation of Beginning and Ending amounts of Unrecognized Tax Benefits, Excluding Interest and Penalties | A reconciliation of the beginning and ending amounts of unrecognized tax benefits, excluding interest and penalties, for each fiscal year is presented below: Fiscal Years Ended July 25, 2015 July 26, 2014 July 27, 2013 (millions) Unrecognized tax benefit beginning balance $ 29.9 $ 31.2 $ 40.5 Additions related to acquisitions — — 2.8 Additions related to current period tax positions 1.6 1.5 1.5 Additions related to tax positions in prior years 6.7 4.3 2.2 Reductions related to prior period tax positions (3.2 ) — (3.0 ) Reductions related to settlements with taxing authorities (0.3 ) (1.5 ) (5.7 ) Reductions related to expiration of statute of limitations (0.6 ) (5.6 ) (7.1 ) Unrecognized tax benefit ending balance $ 34.1 $ 29.9 $ 31.2 |
Reconciliation of Beginning and Ending Amounts of Accrued Interest and Penalties Related to Unrecognized Tax Benefits | A reconciliation of the beginning and ending amounts of accrued interest and penalties related to unrecognized tax benefits for each fiscal year is presented below: Fiscal Years Ended July 25, 2015 July 26, 2014 July 27, 2013 (millions) Accrued interest and penalties beginning balance $ 13.8 $ 16.5 $ 21.2 Reductions credited to expense, net (2.3 ) (2.7 ) (4.7 ) Accrued interest and penalties ending balance $ 11.5 $ 13.8 $ 16.5 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Jul. 25, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Occupancy Costs | A summary of occupancy costs follows: Fiscal Years Ended July 25, July 26, July 27, (millions) Base rentals $ 404.4 $ 395.5 $ 391.6 Percentage rentals 20.5 23.2 21.0 Other occupancy costs, primarily CAM and real estate taxes 143.6 133.5 128.6 Total $ 568.5 $ 552.2 $ 541.2 |
Schedule of Future Minimum Rentals under Non-Cancelable Operating Leases | The following is a schedule of future minimum rentals under non-cancelable operating leases as of July 25, 2015: Fiscal Years Minimum Operating Lease Payments (a) (b) (millions) 2016 $ 407.5 2017 350.1 2018 284.4 2019 225.1 2020 180.3 Subsequent years 472.4 Total future minimum rentals $ 1,919.8 (a) Net of sublease income, which was not significant in any period. (b) Although such amounts are generally non-cancelable, certain leases are cancelable if specified sales levels are not achieved. All future minimum rentals under such leases have been included in the above table. |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Jul. 25, 2015 | |
Equity [Abstract] | |
Schedule of Weighted-Average Common Shares Outstanding | The weighted-average number of common shares outstanding used to calculate basic net (loss) income per common share is reconciled to those shares used in calculating diluted net income per common share as follows: Fiscal Years Ended July 25, 2015 (a) July 26, 2014 July 27, 2013 (millions) Basic 162.6 160.6 157.3 Dilutive effect of stock options, restricted stock and restricted stock units — 4.5 6.0 Diluted shares 162.6 165.1 163.3 (a) There was no dilutive effect of stock options, restricted stock and restricted stock units in Fiscal 2015 as the impact of these items was anti-dilutive because of the Company's net loss incurred during the year. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Jul. 25, 2015 | |
Summary of Total Compensation Expense and Associated Income Tax Benefit | A summary of the total compensation expense and associated income tax benefit recognized related to stock-based compensation arrangements is as follows: Fiscal Years Ended July 25, July 26, July 27, (millions) Compensation expense $ 18.2 $ 30.6 $ 29.5 Income tax benefit $ (6.8 ) $ (11.5 ) $ (11.0 ) |
Weighted-Average Assumptions Used to Estimate Fair Value of Stock Options Granted | The Company’s weighted-average assumptions used to estimate the fair value of stock options granted during the fiscal years presented were as follows: Fiscal Years Ended July 25, July 26, July 27, Expected term (years) 3.9 3.9 3.9 Expected volatility 38.8 % 40.0 % 41.6 % Risk-free interest rate 1.8 % 1.5 % 0.7 % Expected dividend yield — % — % — % Weighted-average grant date fair value $ 4.97 $ 7.11 $ 7.29 |
Summary of Stock Option Activity Under all Plans | A summary of the stock option activity under all plans during Fiscal 2015 is as follows: Number of Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Terms Aggregate Intrinsic Value (a) (thousands) (years) (millions) Options outstanding – July 26, 2014 12,714.4 $ 14.04 5.6 $ 45.7 Granted 3,287.4 14.08 Exercised (908.1 ) 9.21 Canceled/Forfeited (989.8 ) 17.26 Options outstanding – July 25, 2015 14,103.9 $ 14.13 5.1 $ 17.3 Options vested and expected to vest at July 25, 2015 (b) 13,755.8 $ 14.49 5.1 $ 17.3 Options exercisable at July 25, 2015 7,958.3 $ 12.25 4.3 $ 17.2 ______ (a) The intrinsic value is the amount by which the market price at the end of the period of the underlying share of stock exceeds the exercise price of the stock option. (b) The number of options expected to vest takes into consideration estimated expected forfeitures. |
Summary of Restricted Equity Awards Activity | A summary of Restricted Equity Awards activity during Fiscal 2015 is as follows: Service-based Restricted Equity Awards Performance-based Restricted Equity Awards Market-based Restricted Equity Awards Number of Shares Weighted- Average Grant Date Fair Value Per Share Number of Shares Weighted- Average Grant Date Fair Value Per Share Number of Shares Weighted- Average Grant Date Fair Value Per Share (thousands) (thousands) (thousands) Nonvested at July 26, 2014 1,247.7 $ 17.66 662.1 $ 17.18 176.6 $ 16.68 Granted 506.5 13.96 164.0 13.75 61.0 13.34 Vested (451.1 ) 17.33 (109.1 ) 12.91 — — Canceled/Forfeited (201.2 ) 17.49 (267.9 ) 16.80 (52.8 ) 12.25 Nonvested at July 25, 2015 1,101.9 $ 16.13 449.1 $ 17.20 184.8 $ 16.84 |
Total Unrecognized Compensation and Weighted-Average Years Expected to be Recognized | Service-based Restricted Equity Awards Performance-based Restricted Equity Awards Market-based Restricted Equity Awards Total unrecognized compensation at July 25, 2015 (millions) $ 8.5 $ 1.5 $ 0.9 Weighted-average years expected to be recognized over (years) 3.0 1.9 1.7 |
Additional Information Pertaining to Restricted Equity Awards Activity | Additional information pertaining to Restricted Equity Awards activity is as follows: Fiscal Years Ended July 25, July 26, July 27, Service-based Restricted Equity Awards: Weighted-average grant date fair value of awards granted $ 13.96 $ 19.23 $ 20.22 Total fair value of awards vested (millions) 7.1 12.9 10.0 Performance-based Restricted Equity Awards: Weighted-average grant date fair value of awards granted $ 13.75 $ 20.06 $ 18.61 Total fair value of awards vested (millions) 1.4 2.6 — Market-based Restricted Equity Awards: Weighted-average grant date fair value of awards granted $ 13.34 $ 19.46 $ 18.13 Total fair value of awards vested (millions) — 0.6 — |
Cash Settled LTIP Awards | |
Summary of Restricted Equity Awards Activity | A summary of Cash-Settled LTIP Awards activity during Fiscal 2015 is as follows: Cash-Settled LTIP Awards Number of Shares (thousands) Nonvested at July 26, 2014 858.0 Granted 809.4 Vested (107.5 ) Canceled/Forfeited (282.0 ) Nonvested at July 25, 2015 1,277.9 |
Segments (Tables)
Segments (Tables) | 12 Months Ended |
Jul. 25, 2015 | |
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] | |
Net Sales and Operating Income for Each Segment | Net sales and operating (loss) income for each segment are as follows: Fiscal Years Ended July 25, 2015 July 26, 2014 July 27, 2013 Net sales: (millions) Justice $ 1,276.8 $ 1,384.3 $ 1,407.4 Lane Bryant 1,095.9 1,080.0 1,050.1 maurices 1,060.6 971.4 917.6 dressbarn 1,023.6 1,022.5 1,020.7 Catherines 346.0 332.4 319.1 Total net sales $ 4,802.9 $ 4,790.6 $ 4,714.9 Operating (loss) income: Justice $ (62.8 ) $ 99.3 $ 182.3 Lane Bryant (308.0 ) (4.3 ) (30.1 ) maurices 125.9 86.0 107.0 dressbarn 10.7 39.4 30.3 Catherines 31.0 24.4 10.4 Unallocated acquisition and integration expenses (31.7 ) (34.0 ) (34.6 ) Total operating (loss) income $ (234.9 ) $ 210.8 $ 265.3 |
Depreciation and Amortization Expense and Capital Expenditures for Each Segment | Depreciation and amortization expense and capital expenditures for each segment are as follows: Fiscal Years Ended July 25, 2015 July 26, 2014 July 27, 2013 Depreciation and amortization expense: (millions) Justice $ 70.2 $ 60.7 $ 56.3 Lane Bryant 46.8 45.6 43.7 maurices 43.3 39.5 31.5 dressbarn 50.7 40.5 38.5 Catherines 7.2 7.3 6.0 Total depreciation and amortization expense $ 218.2 $ 193.6 $ 176.0 Capital expenditures (a) : Justice $ 51.5 $ 93.5 $ 65.9 Lane Bryant 47.9 53.5 49.1 maurices 56.3 54.0 45.1 dressbarn 47.6 93.5 50.3 Catherines 6.2 7.3 2.7 Corporate (b) 103.0 175.7 77.8 Total capital expenditures $ 312.5 $ 477.5 $ 290.9 (a) Excludes ending accrued capital expenditures of $50.8 million in Fiscal 2015, $64.4 million in Fiscal 2014 and $58.9 million in Fiscal 2013. (b) Includes capital expenditures for technological and supply chain infrastructure and corporate office space. |
Total Assets for Each Segment | Total assets for each segment consist of the following: July 25, 2015 July 26, 2014 Assets: (millions) Justice $ 826.8 $ 858.3 Lane Bryant (a) 597.3 866.4 maurices 562.2 535.5 dressbarn 336.1 358.2 Catherines 98.9 86.6 Corporate ( b ) 494.4 418.8 Total assets $ 2,915.7 $ 3,123.8 _______ (a) The decrease is primarily due to the impairment losses related to Lane Bryant 's goodwill of $261.7 million and trade name of $44.7 million . (b) Includes assets specifically identified as Corporate assets, principally cash, and corporate fixed assets as discussed above. |
Revenue from External Customers by Products and Services | The Company’s operations are largely concentrated in the United States and Canada. Accordingly, net sales and long-lived assets by geographic location are not meaningful at this time. The Company’s revenues by major product categories as a percentage of total net sales are as follows: Fiscal Years Ended July 25, 2015 July 26, 2014 July 27, 2013 (millions) Apparel 84 % 83 % 83 % Accessories and other 16 % 17 % 17 % Total net sales 100 % 100 % 100 % |
Additional Financial Informat43
Additional Financial Information (Tables) | 12 Months Ended |
Jul. 25, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Cash Interest and Taxes | Fiscal Years Ended Cash Interest and Taxes: July 25, 2015 July 26, 2014 July 27, 2013 (millions) Cash paid for interest $ 4.6 $ 4.6 $ 15.6 Cash (received) paid for income taxes $ (5.9 ) $ 42.1 $ 19.7 |
Description of Business (Detail
Description of Business (Details) $ in Millions | 12 Months Ended | ||
Jul. 25, 2015USD ($)storesegmentpeople | Jul. 26, 2014USD ($) | Jul. 27, 2013USD ($) | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items] | |||
Ownership percentage of wholly owned subsidiaries | 100.00% | ||
Number of stores | store | 3,900 | ||
Net sales | $ 4,802.9 | $ 4,790.6 | $ 4,714.9 |
Number of reportable segments | segment | 5 | ||
Justice | |||
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items] | |||
Number of stores | store | 978 | ||
Net sales | $ 1,276.8 | 1,384.3 | 1,407.4 |
Minimum customer age | 5 years | ||
Maximum customer age | 12 years | ||
Lane Bryant | |||
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items] | |||
Number of stores | store | 765 | ||
Net sales | $ 1,095.9 | 1,080 | 1,050.1 |
Minimum customer age | 25 years | ||
Maximum customer age | 45 years | ||
Maurices | |||
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items] | |||
Number of stores | store | 951 | ||
Net sales | $ 1,060.6 | 971.4 | 917.6 |
Minimum small market | people | 25,000 | ||
Maximum small market | people | 150,000 | ||
Dressbarn | |||
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items] | |||
Number of stores | store | 824 | ||
Net sales | $ 1,023.6 | 1,022.5 | 1,020.7 |
Catherines | |||
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items] | |||
Number of stores | store | 377 | ||
Net sales | $ 346 | $ 332.4 | $ 319.1 |
Minimum customer age | 45 years |
Basis of Presentation (Narrativ
Basis of Presentation (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Oct. 26, 2013 | Jul. 27, 2013 | Jul. 27, 2013 | Jul. 25, 2015 | |
Basis of Presentation [Line Items] | ||||
Ownership percentage of wholly owned subsidiaries | 100.00% | |||
Discontinued operations, reduction in assets | $ 4.6 | $ 8 | ||
Sales from discontinued operations | $ 7.4 | $ 407.6 | ||
Discontinued Operations | ||||
Basis of Presentation [Line Items] | ||||
Net proceeds from sale of distribution center | $ 16 |
Summary of Significant Accoun46
Summary of Significant Accounting Policies (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Accounting Policies [Abstract] | |||
Sales return reserves | $ 9,200,000 | $ 7,700,000 | |
Fulfillment Expense | 37,800,000 | 38,000,000 | $ 33,400,000 |
Marketing and advertising expenses | 176,700,000 | 160,100,000 | $ 169,100,000 |
Net losses from foreign currency transactions | 900,000 | 1,600,000 | |
Accrued insurance reserves | 48,500,000 | $ 52,900,000 | |
Insurance coverage | $ 350,000 | ||
Tax benefit measurement | 50.00% |
Summary of Significant Accoun47
Summary of Significant Accounting Policies (Schedule of Property and Equipment Estimated Useful Lives) (Details) | 12 Months Ended |
Jul. 25, 2015 | |
Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful lives, description | Shorter of the useful life or expected term of the lease |
Minimum | Buildings and improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful lives | 10 years |
Minimum | Distribution Center Equipment and Machinery | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful lives | 3 years |
Minimum | Furniture, fixtures and equipment | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful lives | 2 years |
Minimum | Information Technology | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful lives | 3 years |
Maximum | Buildings and improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful lives | 40 years |
Maximum | Distribution Center Equipment and Machinery | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful lives | 20 years |
Maximum | Furniture, fixtures and equipment | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful lives | 10 years |
Maximum | Information Technology | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful lives | 10 years |
Recently Issued Accounting St48
Recently Issued Accounting Standards (Details) - USD ($) $ in Millions | Jul. 25, 2015 | Jul. 26, 2014 |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | ||
Debt issuance cost | $ 9.5 | $ 5.2 |
Inventories (Schedule of Invent
Inventories (Schedule of Inventories by Brand) (Details) - USD ($) $ in Millions | Jul. 25, 2015 | Jul. 26, 2014 |
Inventory [Line Items] | ||
Total inventories | $ 489.3 | $ 553.2 |
Justice | ||
Inventory [Line Items] | ||
Total inventories | 136 | 198.6 |
Lane Bryant | ||
Inventory [Line Items] | ||
Total inventories | 126.5 | 125.6 |
maurices | ||
Inventory [Line Items] | ||
Total inventories | 103.8 | 105.5 |
dressbarn | ||
Inventory [Line Items] | ||
Total inventories | 93.3 | 97.1 |
Catherines | ||
Inventory [Line Items] | ||
Total inventories | $ 29.7 | $ 26.4 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Millions | Jul. 25, 2015 | Jul. 26, 2014 |
Fair Value Disclosures [Abstract] | ||
Investments | $ 13.4 | $ 30.4 |
Property and Equipment (Schedul
Property and Equipment (Schedule of Property and Equipment, Net) (Details) - USD ($) $ in Millions | Jul. 25, 2015 | Jul. 26, 2014 | |
Property, Plant and Equipment [Line Items] | |||
Property and equipment | $ 1,949.9 | $ 1,754.8 | |
Less: accumulated depreciation | (779.9) | (644.2) | |
Property and equipment, net | 1,170 | 1,110.6 | |
Land | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | 30.4 | 33.1 | |
Buildings and improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | 189.3 | 177.9 | |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | 652.7 | 604 | |
Furniture, fixtures and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | 572.7 | 545.7 | |
Information technology | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | [1] | 356.2 | 237.3 |
Construction in progress | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment | [1] | $ 148.6 | $ 156.8 |
[1] | Investments in our point-of-sale and merchandising systems that were placed in service during Fiscal 2015 are included in Information technology and were included within construction in progress in Fiscal 2014. Investments related to the development of our ecommerce platforms and costs associated with the construction of a new headquarters building for maurices and certain shared services operations in Duluth, MN are included within Construction in process in Fiscal 2015. |
Property and Equipment (Long-Li
Property and Equipment (Long-Lived Asset Impairments) (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Impaired Long-Lived Assets Held and Used [Line Items] | |||
Non-cash impairment charges | $ 10,800,000 | $ 4,200,000 | $ 4,600,000 |
Justice | |||
Impaired Long-Lived Assets Held and Used [Line Items] | |||
Non-cash impairment charges | 6,400,000 | 300,000 | 100,000 |
Lane Bryant | |||
Impaired Long-Lived Assets Held and Used [Line Items] | |||
Non-cash impairment charges | 600,000 | 900,000 | 2,000,000 |
maurices | |||
Impaired Long-Lived Assets Held and Used [Line Items] | |||
Non-cash impairment charges | 2,600,000 | 1,100,000 | 700,000 |
dressbarn | |||
Impaired Long-Lived Assets Held and Used [Line Items] | |||
Non-cash impairment charges | 1,200,000 | 1,900,000 | 1,800,000 |
Catherines | |||
Impaired Long-Lived Assets Held and Used [Line Items] | |||
Non-cash impairment charges | $ 0 | $ 0 | $ 0 |
Property and Equipment (Depreci
Property and Equipment (Depreciation) (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 215.8 | $ 190.9 | $ 173.4 |
Incremental depreciation expenses | 5.9 | 8.6 | 14.2 |
Increase (decrease) in income due to incremental depreciation expense | $ 3.7 | $ (5.3) | $ (8.9) |
Amount of diluted net income per common share (in dollars per share) | $ 0.02 | $ (0.03) | $ (0.05) |
Goodwill and Other Intangible54
Goodwill and Other Intangible Assets (Changes in Each Reportable Segment) (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |||
Goodwill [Line Items] | |||||
Non-cash impairment of intangible assets | $ 44.7 | $ 13 | $ 0 | ||
Goodwill [Roll Forward] | |||||
Goodwill, Beginning Balance | 581.4 | 581.4 | |||
Acquisition-related activity | 0 | ||||
Impairment losses | (261.7) | [1] | 0 | 0 | |
Goodwill, Ending Balance | 319.7 | 581.4 | 581.4 | ||
Justice | |||||
Goodwill [Roll Forward] | |||||
Goodwill, Beginning Balance | 103.6 | 103.6 | |||
Acquisition-related activity | 0 | ||||
Goodwill, Ending Balance | 103.6 | 103.6 | 103.6 | ||
Lane Bryant | |||||
Goodwill [Line Items] | |||||
Non-cash impairment of intangible assets | 44.7 | ||||
Goodwill [Roll Forward] | |||||
Goodwill, Beginning Balance | 319.1 | 319.1 | |||
Acquisition-related activity | 0 | ||||
Impairment losses | [1] | (261.7) | |||
Goodwill, Ending Balance | 57.4 | 319.1 | 319.1 | ||
maurices | |||||
Goodwill [Line Items] | |||||
Non-cash impairment of intangible assets | 13 | ||||
Goodwill [Roll Forward] | |||||
Goodwill, Beginning Balance | 130.7 | 130.7 | |||
Acquisition-related activity | 0 | ||||
Goodwill, Ending Balance | 130.7 | 130.7 | 130.7 | ||
dressbarn | |||||
Goodwill [Roll Forward] | |||||
Goodwill, Beginning Balance | 0 | 0 | |||
Acquisition-related activity | 0 | ||||
Goodwill, Ending Balance | 0 | 0 | 0 | ||
Catherines | |||||
Goodwill [Roll Forward] | |||||
Goodwill, Beginning Balance | 28 | 28 | |||
Acquisition-related activity | 0 | ||||
Goodwill, Ending Balance | $ 28 | $ 28 | $ 28 | ||
[1] | Represents accumulated impairment losses as of July 25, 2015. |
Goodwill and Other Intangible55
Goodwill and Other Intangible Assets (Other Intangible Assets) (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | ||
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | ||||
Intangible assets subject to amortization, gross carrying amount | $ 13.8 | $ 14.5 | ||
Intangible assets subject to amortization, accumulated amortization | (13.8) | (12.1) | ||
Intangible assets subject to amortization, net | 0 | 2.4 | ||
Intangible assets not subject to amortization, gross carrying amount | 388.3 | 433 | ||
Total intangible assets, gross carrying amount | 402.1 | 447.5 | ||
Total intangible assets, Net | 388.3 | 435.4 | ||
Non-cash impairment of intangible assets | 44.7 | 13 | $ 0 | |
Brands and Trademarks | ||||
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | ||||
Intangible assets not subject to amortization, gross carrying amount | [1] | 377.4 | 422.1 | |
Franchise Rights | ||||
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | ||||
Intangible assets not subject to amortization, gross carrying amount | 10.9 | 10.9 | ||
Technology-Based Intangible Assets | ||||
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | ||||
Intangible assets subject to amortization, gross carrying amount | 5.8 | 6.5 | ||
Intangible assets subject to amortization, accumulated amortization | (5.8) | (5.7) | ||
Intangible assets subject to amortization, net | 0 | 0.8 | ||
Customer Relationships | ||||
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | ||||
Intangible assets subject to amortization, gross carrying amount | 2.7 | 2.7 | ||
Intangible assets subject to amortization, accumulated amortization | (2.7) | (2.6) | ||
Intangible assets subject to amortization, net | 0 | 0.1 | ||
Trade Names | ||||
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | ||||
Intangible assets subject to amortization, gross carrying amount | 5.3 | 5.3 | ||
Intangible assets subject to amortization, accumulated amortization | (5.3) | (3.8) | ||
Intangible assets subject to amortization, net | 0 | $ 1.5 | ||
Lane Bryant | ||||
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | ||||
Non-cash impairment of intangible assets | $ 44.7 | |||
[1] | The decrease is due to the impairment loss of $44.7 million recognized for the Lane Bryant trade name in Fiscal 2015. |
Goodwill and Other Intangible56
Goodwill and Other Intangible Assets (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |||
Goodwill [Line Items] | |||||
Recognized amortization expense on other intangible assets | $ 2.4 | $ 2.7 | $ 2.6 | ||
Impairment of goodwill | 261.7 | [1] | 0 | 0 | |
Goodwill | 319.7 | 581.4 | 581.4 | ||
Impairment loss | 44.7 | 13 | 0 | ||
Lane Bryant | |||||
Goodwill [Line Items] | |||||
Impairment of goodwill | [1] | 261.7 | |||
Goodwill | 57.4 | 319.1 | 319.1 | ||
Impairment loss | 44.7 | ||||
Write down of carrying value to fair value | 211.8 | ||||
Maurices | |||||
Goodwill [Line Items] | |||||
Goodwill | 130.7 | $ 130.7 | $ 130.7 | ||
Impairment loss | $ 13 | ||||
[1] | Represents accumulated impairment losses as of July 25, 2015. |
Goodwill and Other Intangible57
Goodwill and Other Intangible Assets Goodwill and Other Indefinite-lived Intangible Assets (Impairment Assessment) (Details) | Jul. 25, 2015 |
Goodwill and Intangible Assets Disclosure (Impairment Assessment) [Abstract] | |
Income Valuation Approach | 75.00% |
Market Valuation Approach | 25.00% |
Prepaid Expenses and Other Cu58
Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Millions | Jul. 25, 2015 | Jul. 26, 2014 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Prepaid expenses | $ 45.6 | $ 40.6 |
Accounts and other receivables | 70.8 | 90.8 |
Short-term Investments | 13.4 | 30.4 |
Other current assets | 1.7 | 5 |
Total prepaid expenses and other current assets | $ 131.5 | $ 166.8 |
Accrued Expenses and Other Cu59
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Millions | Jul. 25, 2015 | Jul. 26, 2014 | |
Accrued Expense and Other Current Liabilities (Legal Reserve) [Line Items] | |||
Accrued salary, wages and related expenses | [1] | $ 176.9 | $ 120.6 |
Accrued operating expenses | [2] | 202.1 | 164 |
Sales and other taxes payable | 14.2 | 15.7 | |
Other | 10 | 8.6 | |
Total accrued expenses and other current liabilities | 403.2 | $ 308.9 | |
Retirement compensation | 35 | ||
Justice | |||
Accrued Expense and Other Current Liabilities (Legal Reserve) [Line Items] | |||
Legal reserve | $ 50 | ||
[1] | The increase is primarily due to the reclassification of approximately $35 million of retirement compensation from Other non-current liabilities to Accrued expenses and other current liabilities during Fiscal 2015, as more fully described in Employment Agreements section in Note 14. | ||
[2] | The increase is primarily due to the establishment of a legal reserve of approximately $50 million in connection with the Justice pricing lawsuits, as more fully described in Note 14. |
Debt (Schedule of Debt) (Detail
Debt (Schedule of Debt) (Details) - USD ($) $ in Millions | Jul. 25, 2015 | Jul. 26, 2014 |
Debt Disclosure [Abstract] | ||
Revolving credit agreement | $ 116 | $ 172 |
Less: current portion | 0 | 0 |
Total long-term debt | $ 116 | $ 172 |
Debt (Revolving Credit Agreemen
Debt (Revolving Credit Agreement) (Narrative) (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |
Mar. 31, 2013 | Jul. 25, 2015 | Jul. 26, 2014 | |
Debt Instrument [Line Items] | |||
Revolving credit agreement | $ 116,000,000 | $ 172,000,000 | |
Outstanding letter of credit | $ 13,300,000 | ||
Minimum | |||
Debt Instrument [Line Items] | |||
Applicable margin above base rate | 1.25% | ||
Maximum | |||
Debt Instrument [Line Items] | |||
Applicable margin above base rate | 1.50% | ||
Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 500,000,000 | ||
Optional additional increase in credit facility | $ 100,000,000 | ||
Outstanding letter of credit | $ 13,300,000 | ||
Senior secured revolving credit facility, remaining borrowing capacity | $ 322,400,000 | ||
Revolving Credit Facility | Minimum | |||
Debt Instrument [Line Items] | |||
Applicable margin above base rate | 0.50% | 0.25% | |
Commitment fee on unutilized revolving credit facility | 0.25% | 0.20% | |
Revolving Credit Facility | Maximum | |||
Debt Instrument [Line Items] | |||
Applicable margin above base rate | 2.00% | 0.50% | |
Commitment fee on unutilized revolving credit facility | 0.375% | 0.25% | |
Revolving Credit Facility | LIBOR | |||
Debt Instrument [Line Items] | |||
Applicable margin above base rate | 1.00% | 1.00% | |
Revolving Credit Facility | Federal Funds Rate | |||
Debt Instrument [Line Items] | |||
Applicable margin above base rate | 0.50% | 0.50% |
Debt (Restrictions Under the Re
Debt (Restrictions Under the Revolving Credit Agreement) (Narrative) (Details) - Jul. 25, 2015 - Revolving Credit Facility $ in Millions | USD ($) |
Debt Instrument [Line Items] | |
Reduced availability period, minimum threshold | $ 50 |
Senior secured revolving credit facility, remaining borrowing capacity | $ 322.4 |
Credit facility financial covenants, minimum fixed charge coverage ratio | 1 |
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Minimum | 20.00% |
Debt (Loss on Extinguishment of
Debt (Loss on Extinguishment of Debt) (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||
Jul. 28, 2012 | Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | Jul. 28, 2012 | |
Debt Instrument [Line Items] | |||||
Pretax loss | $ 0 | $ 0 | $ (9.3) | ||
Term Loan | |||||
Debt Instrument [Line Items] | |||||
Borrowings under credit facility for acquisitions | $ 300 | ||||
Debt Instrument, Term | 6 years | ||||
Pretax loss | (8.5) | ||||
Mortgages | Charming Shoppes Acquisition | |||||
Debt Instrument [Line Items] | |||||
Mortgage obligation assumed | $ 7.8 | $ 7.8 | |||
Mortgage Obligation [Member] | Charming Shoppes Acquisition | |||||
Debt Instrument [Line Items] | |||||
Pretax loss | $ (0.8) |
Income Taxes (Domestic and Fore
Income Taxes (Domestic and Foreign Pretax Income) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Domestic and Foreign Income [Line Items] | |||
Total (loss) income from continuing operations before provision for income taxes | $ (240.6) | $ 203.5 | $ 242.6 |
Domestic | |||
Domestic and Foreign Income [Line Items] | |||
Total (loss) income from continuing operations before provision for income taxes | (303.1) | 144.7 | 189.8 |
Foreign | |||
Domestic and Foreign Income [Line Items] | |||
Total (loss) income from continuing operations before provision for income taxes | $ 62.5 | $ 58.8 | $ 52.8 |
Income Taxes (Provisions (Benef
Income Taxes (Provisions (Benefits) from Continuing Operations for Current and Deferred Income Taxes) (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | ||
Current: | ||||
Federal | [1] | $ (20.8) | $ 15.2 | $ 30.6 |
State and local | [1] | 8.8 | 13.5 | 5.7 |
Foreign | 14.8 | 12.3 | 10.6 | |
Current income tax expense, total | 2.8 | 41 | 46.9 | |
Deferred: | ||||
Federal | 0.9 | 24.9 | 38.6 | |
State and local | (6.5) | (0.2) | 1.4 | |
Foreign | (1) | (0.4) | 0.5 | |
Total deferred income tax expense (benefit), total | (6.6) | 24.3 | 40.5 | |
Total (benefit) provision for income taxes from continuing operations | (3.8) | 65.3 | 87.4 | |
Income Tax Benefit Provision Related To Stock Based Compensation And Other Arrangements | $ (1.2) | $ 4.2 | $ 14.1 | |
[1] | Excludes excess tax benefits of approximately $(1.2) million in Fiscal 2015, $4.2 million in Fiscal 2014 and $14.1 million in Fiscal 2013 resulting from stock-based compensation arrangements. Such amounts were recorded within equity. |
Income Taxes (Differences Betwe
Income Taxes (Differences Between Income Taxes Expected at U.S. Federal Statutory Income Tax Rate and Income Taxes Provided) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Income Tax Disclosure [Abstract] | |||
(Benefit) provision for income taxes from continuing operations at the U.S. federal statutory rate | $ (84.3) | $ 71.2 | $ 84.9 |
Increase (decrease) due to: | |||
State and local income taxes, net of federal benefit | 4.1 | 8.8 | 8.4 |
Tax benefit related to deferred compensation | (13.7) | 0 | 0 |
Goodwill impairment | 91.6 | 0 | 0 |
Net change relating to uncertain income tax benefits | (0.7) | (2.3) | (6.4) |
Indefinitely reinvested foreign earnings | 1.7 | (11.6) | (0.9) |
Other – net | (2.5) | (0.8) | 1.4 |
Total (benefit) provision for income taxes from continuing operations | $ (3.8) | $ 65.3 | $ 87.4 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | Jun. 30, 2012 | ||
Income Taxes [Line Items] | |||||
U.S. federal statutory income tax rate | 35.00% | ||||
Impairment of goodwill | $ 261.7 | [1] | $ 0 | $ 0 | |
Deferred compensation | 35 | ||||
Total tax credits expected to receive | 60 | ||||
Tax credits received | 2 | ||||
Undistributed earnings from non-U.S. subsidiaries | 42.8 | ||||
Valuation allowance | (4.9) | (2.8) | |||
Increase to valuation allowance | 2.1 | ||||
Amount of current taxes deferred | 32 | ||||
Unrecognized tax benefits (including accrued interest and penalties) | 40.7 | $ 40.9 | |||
Estimated decrease in unrecognized tax benefits, over the next twelve months | 2.8 | ||||
Gross unrecognized tax benefits that would affect effective tax rate, including interest and penalties | 23.2 | ||||
State and Local Jurisdiction | |||||
Income Taxes [Line Items] | |||||
Net operating loss carryforwards | 52.1 | ||||
State and Local Jurisdiction | Period of Expiration One to Five | |||||
Income Taxes [Line Items] | |||||
Net operating loss carryforwards | 15.2 | ||||
State and Local Jurisdiction | Period of Expiration Six To Ten | |||||
Income Taxes [Line Items] | |||||
Net operating loss carryforwards | 11.8 | ||||
State and Local Jurisdiction | Period of Expiration Eleven to Fifteen | |||||
Income Taxes [Line Items] | |||||
Net operating loss carryforwards | 20 | ||||
State and Local Jurisdiction | Period of Expiration Sixteen to Twenty | |||||
Income Taxes [Line Items] | |||||
Net operating loss carryforwards | 5.1 | ||||
Internal Revenue Service (IRS) | |||||
Income Taxes [Line Items] | |||||
Net operating loss carryforwards | $ 1 | ||||
Net operating loss carryforwards expiration period | 20 years | ||||
Charming Shoppes Acquisition | |||||
Income Taxes [Line Items] | |||||
Net operating loss carryforwards | $ 9.5 | $ 69.3 | |||
Net operating loss carryforwards utilized in period | $ 19.4 | ||||
Minimum | |||||
Income Taxes [Line Items] | |||||
Period to recognized tax incentives | 10 years | ||||
Minimum | State and Local Jurisdiction | |||||
Income Taxes [Line Items] | |||||
Net operating loss carryforwards expiration period | 5 years | ||||
Minimum | Internal Revenue Service (IRS) | |||||
Income Taxes [Line Items] | |||||
Operating loss carryforwards, year of expiration | 2,017 | ||||
Maximum | |||||
Income Taxes [Line Items] | |||||
Period to recognized tax incentives | 15 years | ||||
Maximum | State and Local Jurisdiction | |||||
Income Taxes [Line Items] | |||||
Net operating loss carryforwards expiration period | 20 years | ||||
[1] | Represents accumulated impairment losses as of July 25, 2015. |
Income Taxes (Significant Compo
Income Taxes (Significant Components of Net Deferred Tax Assets (Liabilities)) (Details) - USD ($) $ in Millions | Jul. 25, 2015 | Jul. 26, 2014 |
Deferred tax assets: | ||
Inventories | $ 18.7 | $ 14.3 |
Tax credits and net operating loss carryforwards | 18.7 | 14.2 |
Accrued payroll and benefits | 78.3 | 59.9 |
Legal reserve | 21 | 0 |
Share-based compensation | 23.7 | 23.1 |
Straight-line rent | 45.7 | 50 |
Federal benefit of uncertain tax positions | 14.7 | 15.5 |
Other | 19.2 | 18.8 |
Total deferred tax assets | 240 | 195.8 |
Deferred tax liabilities: | ||
Depreciation | 113 | 85.8 |
Amortization | 168.6 | 171.7 |
Foreign unremitted earnings | 32.8 | 20.7 |
Other | 14 | 15.8 |
Total deferred tax liabilities | 328.4 | 294 |
Valuation allowance | (4.9) | (2.8) |
Net deferred tax liabilities | $ (93.3) | $ (101) |
Income Taxes (Reconciliation of
Income Taxes (Reconciliation of Beginning and Ending amounts of Unrecognized Tax Benefits, Excluding Interest and Penalties) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Income Tax Disclosure [Abstract] | |||
Unrecognized tax benefit beginning balance | $ 29.9 | $ 31.2 | $ 40.5 |
Additions related to acquisitions | 0 | 0 | 2.8 |
Additions related to current period tax positions | 1.6 | 1.5 | 1.5 |
Additions related to tax positions in prior years | 6.7 | 4.3 | 2.2 |
Reductions related to prior period tax positions | (3.2) | 0 | (3) |
Reductions related to settlements with taxing authorities | (0.3) | (1.5) | (5.7) |
Reductions related to expiration of statute of limitations | (0.6) | (5.6) | (7.1) |
Unrecognized tax benefit ending balance | $ 34.1 | $ 29.9 | $ 31.2 |
Income Taxes (Reconciliation 70
Income Taxes (Reconciliation of Beginning and Ending Amounts of Accrued Interest and Penalties Related to Unrecognized Tax Benefits) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Income Tax Disclosure [Abstract] | |||
Accrued interest and penalties beginning balance | $ 13.8 | $ 16.5 | $ 21.2 |
Reductions credited to expense, net | (2.3) | (2.7) | (4.7) |
Accrued interest and penalties ending balance | $ 11.5 | $ 13.8 | $ 16.5 |
Employee Benefit Plans (Narrati
Employee Benefit Plans (Narrative) (Details) | 12 Months Ended | ||
Jul. 25, 2015USD ($)fund | Jul. 26, 2014USD ($) | Jul. 27, 2013USD ($) | |
Retirement Savings Plan (401 (k)) | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employer matching contribution of the first 5% employee contribution | 100.00% | ||
Employee's contribution matched by employer | 3.00% | ||
Defined contribution plan, employer matching contribution | 50.00% | ||
Defined contribution plan, employee's contribution matched | 2.00% | ||
Expenses related to contributions and administration of plans | $ 8,800,000 | $ 5,200,000 | $ 4,700,000 |
Additional matching contribution to ERP Plan | 100.00% | ||
Additional matching contribution to ERP Plan, percent of base salary | 5.00% | ||
Executive Retirement Plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employer matching contribution of the first 5% employee contribution | 100.00% | ||
Employee's contribution matched by employer | 1.00% | ||
Expenses related to contributions and administration of plans | $ 3,300,000 | 7,200,000 | 7,700,000 |
Employee contribution of base salary and bonus | 50.00% | ||
Maximum bonus contribution per employee | 75.00% | ||
Threshold for bonus salary deferral match on first 1% | $ 265,000 | ||
Threshold for bonus salary deferral match on first 5% | $ 265,000 | ||
Vesting percentage | 100.00% | ||
Incremental vesting period | 5 years | ||
Amount of matching contributions | $ 2,100,000 | 3,400,000 | $ 2,700,000 |
Number reference investment fund elections offered to participating employees | fund | 28 | ||
Defined contribution plan, liabilities recognized | $ 70,700,000 | 65,900,000 | |
Classified within Accrued expenses and other current liabilities | 3,800,000 | 3,600,000 | |
Defined contribution plan, noncurrent liabilities recognized | $ 66,900,000 | $ 62,300,000 | |
Employee Stock Purchase Plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employee share purchase during each quarterly offering period, discount | 10.00% |
Commitments and Contingencies72
Commitments and Contingencies (Narrative) (Details) | 12 Months Ended | ||
Jul. 25, 2015USD ($)store | Jul. 26, 2014USD ($) | ||
Commitments and Contingencies [Line Items] | |||
Initial terms of lease, period | 10 years | ||
Option to extend lease, period | 5 years | ||
Total future minimum rentals | [1],[2] | $ 1,919,800,000 | |
Retirement compensation | 35,000,000 | ||
Severance payment, Rabbi Trust | $ 9,000,000 | ||
Period prior to shipment date to cancel commitments (in days) | 30 days | ||
Outstanding letter of credit | $ 13,300,000 | ||
Minimum | |||
Commitments and Contingencies [Line Items] | |||
Period of preliminary commitments made in advance of planned receipt (in months) | 5 months | ||
Maximum | |||
Commitments and Contingencies [Line Items] | |||
Period of preliminary commitments made in advance of planned receipt (in months) | 7 months | ||
Justice | |||
Commitments and Contingencies [Line Items] | |||
Legal reserve | $ 50,000,000 | ||
Chairman or Related Trusts | |||
Commitments and Contingencies [Line Items] | |||
Number of leased stores with related parties | store | 2 | ||
Annual future minimum rentals related-party leases | $ 400,000 | ||
Subsequent minimum payments | 200,000 | ||
Total future minimum rentals | 1,200,000 | ||
Rent expense | $ 400,000 | $ 400,000 | |
[1] | Although such amounts are generally non-cancelable, certain leases are cancelable if specified sales levels are not achieved. All future minimum rentals under such leases have been included in the above table. | ||
[2] | Net of sublease income, which was not significant in any period. |
Commitments and Contingencies73
Commitments and Contingencies (Summary of Occupancy Costs) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Base rentals | $ 404.4 | $ 395.5 | $ 391.6 |
Percentage rentals | 20.5 | 23.2 | 21 |
Other occupancy costs, primarily CAM and real estate taxes | 143.6 | 133.5 | 128.6 |
Total | $ 568.5 | $ 552.2 | $ 541.2 |
Commitments and Contingencies74
Commitments and Contingencies (Schedule of Future Minimum Rentals Under Non-Cancelable Operating Leases) (Details) | Jul. 25, 2015USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | ||
2,015 | [1],[2] | $ 407,500,000 |
2,016 | [1],[2] | 350,100,000 |
2,017 | [1],[2] | 284,400,000 |
2,018 | [1],[2] | 225,100,000 |
2,019 | [1],[2] | 180,300,000 |
Subsequent years | [1],[2] | 472,400,000 |
Total future minimum rentals | [1],[2] | $ 1,919,800,000 |
[1] | Although such amounts are generally non-cancelable, certain leases are cancelable if specified sales levels are not achieved. All future minimum rentals under such leases have been included in the above table. | |
[2] | Net of sublease income, which was not significant in any period. |
Equity (Narrative) (Details)
Equity (Narrative) (Details) - USD ($) | 12 Months Ended | ||||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | Jul. 30, 2011 | Jul. 31, 2010 | |
Equity [Abstract] | |||||
Number of common shares authorized | 360,000,000 | ||||
Number of preferred shares authorized | 100,000 | ||||
Number of preferred shares issued | 0 | ||||
Number of preferred shares outstanding | 0 | ||||
Share repurchase program authorized amount | $ 100,000,000 | ||||
Share repurchase program additional authorized amount | $ 100,000,000 | ||||
Cumulative repurchases under 2010 Stock Repurchase Plan | $ 110,100,000 | ||||
Number of common shares repurchased | 0 | 0 | 0 | ||
Stock repurchase program remaining authorized repurchase amount | $ 89,900,000 | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 15,800,000 | 5,600,000 | 3,000,000 |
Equity (Weighted-Average Common
Equity (Weighted-Average Common Shares Outstanding) (Details) - shares shares in Millions | 12 Months Ended | |||
Jul. 25, 2015 | [1] | Jul. 26, 2014 | Jul. 27, 2013 | |
Equity [Abstract] | ||||
Basic (shares) | 162.6 | 160.6 | 157.3 | |
Dilutive effect of stock options, restricted stock and restricted stock units (shares) | 0 | 4.5 | 6 | |
Diluted shares (shares) | 162.6 | 165.1 | 163.3 | |
[1] | There was no dilutive effect of stock options, restricted stock and restricted stock units in Fiscal 2015 as the impact of these items was anti-dilutive because of the Company's net loss incurred during the year. |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narrative) (Details) $ in Millions | 12 Months Ended | ||
Jul. 25, 2015USD ($)shares | Jul. 26, 2014USD ($) | Jul. 27, 2013USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Aggregate number of share that may be issued under Stock Incentive Plan | shares | 51,000,000 | ||
Shares available for future grants under stock incentive plan | shares | 8,300,000 | ||
Deferred Compensation Share-based Arrangements, Liability, Current and Noncurrent | $ 1.9 | $ 5.3 | |
Deferred Compensation Share-based Arrangements, Liability, Current | 0.2 | 1.8 | |
Deferred Compensation Share-based Arrangements, Liability, Classified, Noncurrent | 1.7 | 3.5 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Share-based Liabilities Paid | 1.6 | 6.2 | |
Employee Stock Option | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total unrecognized compensation costs related to non-vested option | $ 24.3 | ||
Weighted-average years expected to be recognized over (years) | 2 years 6 months 5 days | ||
Total intrinsic value of options exercised | $ 5 | 17.1 | $ 44.5 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | $ 14.2 | $ 14.1 | $ 11.8 |
Employee Stock Option | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock options vesting period | 4 years | ||
Stock options expiration period | 7 years | ||
Employee Stock Option | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock options vesting period | 5 years | ||
Stock options expiration period | 10 years | ||
Restricted Stock Units (RSUs) | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares issuable per vesting of one restricted stock or unit | shares | 2.3 | ||
Service Based Restricted Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock options vesting period | 4 years | ||
Cash Settled LTIP Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock options vesting period | 3 years | ||
Weighted-average years expected to be recognized over (years) | 2 years | ||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $ 4.1 |
Stock-Based Compensation (Summa
Stock-Based Compensation (Summary of Total Compensation Expense and Associated Income Tax Benefit) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Compensation expense | $ 18.2 | $ 30.6 | $ 29.5 |
Income tax benefit | $ (6.8) | $ (11.5) | $ (11) |
Stock Based Compensation (Weigh
Stock Based Compensation (Weighted-Average Assumptions Used to Estimate Fair Value of Stock Options Granted) (Details) - $ / shares | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Expected term (years) | 3 years 10 months 24 days | 3 years 10 months 24 days | 3 years 10 months 24 days |
Expected volatility | 38.80% | 40.00% | 41.60% |
Risk-free interest rate | 1.80% | 1.50% | 0.70% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Weighted-average grant date fair value | $ 4.97 | $ 7.11 | $ 7.29 |
Stock-Based Compensation (Sum80
Stock-Based Compensation (Summary of Stock Option Activity Under All Plans) (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | ||
Number of Shares | |||
Number of Shares, Options outstanding - Beginning | 12,714,400 | ||
Number of Shares, Granted | 3,287,400 | ||
Number of Shares, Exercised | (908,100) | ||
Number of Shares, Cancelled/Forfeited | (989,800) | ||
Number of Shares, Options outstanding - Ending | 14,103,900 | 12,714,400 | |
Number of Shares, Options vested and expected to vest at year-end | [1] | 13,755,800 | |
Number of Shares, Options exercisable at year-end | 7,958,300 | ||
Weighted-Average Exercise Price | |||
Weighted-Average Exercise Price, Options outstanding - Beginning | $ 14.04 | ||
Weighted-Average Exercise Price, Granted | 14.08 | ||
Weighted-Average Exercise Price, Exercised | 9.21 | ||
Weighted-Average Exercise Price, Cancelled/Forfeited | 17.26 | ||
Weighted-Average Exercise Price, Options outstanding - Ending | 14.13 | $ 14.04 | |
Weighted-Average Exercise Price, Options vested and expected to vest at year-end | [1] | 14.49 | |
Weighted-Average Exercise Price, Options exercisable at year-end | $ 12.25 | ||
Weighted-Average Remaining Contractual Terms (years) | |||
Weighted-Average Remaining Contractual Terms (years), Options outstanding - Beginning | 5 years 1 month 6 days | 5 years 7 months 11 days | |
Weighted-Average Remaining Contractual Terms (years), Options outstanding - Ending | 5 years 1 month 6 days | 5 years 7 months 11 days | |
Weighted-Average Remaining Contractual Terms (years), Options vested and expected to vest at year-end | [1] | 5 years 1 month 6 days | |
Weighted-Average Remaining Contractual Terms (years), Options exercisable at year-end | 4 years 3 months 18 days | ||
Aggregate Intrinsic Value | |||
Aggregate Intrinsic Value, Options outstanding - Beginning | [2] | $ 17.3 | $ 45.7 |
Aggregate Intrinsic Value, Options outstanding - Ending | [2] | 17.3 | $ 45.7 |
Aggregate Intrinsic Value, Options vested and expected to vest at year-end | [1],[2] | 17.3 | |
Aggregate Intrinsic Value, Options exercisable at year-end | [2] | $ 17.2 | |
[1] | The number of options expected to vest takes into consideration estimated expected forfeitures. | ||
[2] | The intrinsic value is the amount by which the market price at the end of the period of the underlying share of stock exceeds the exercise price of the stock option. |
Stock-Based Compensation (Sum81
Stock-Based Compensation (Summary of Restricted Equity Awards Activity) (Details) - $ / shares | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Service-based Restricted Equity Awards | |||
Number of shares | |||
Nonvested Number of shares at beginning of the year | 1,247,700 | ||
Granted | 506,500 | ||
Vested | (451,100) | ||
Canceled/Forfeited | (201,200) | ||
Nonvested Number of shares at the end of the year | 1,101,900 | 1,247,700 | |
Weighted Average Grant Date Fair Value Per Share | |||
Nonvested Weighted-Average Grant Date Fair Value at the beginning of the year | $ 17.66 | ||
Granted | 13.96 | $ 19.23 | $ 20.22 |
Vested | 17.33 | ||
Canceled/Forfeited | 17.49 | ||
Nonvested Weighted-Average Grant Date Fair Value at the end of the year | $ 16.13 | $ 17.66 | |
Performance-based Restricted Equity Awards | |||
Number of shares | |||
Nonvested Number of shares at beginning of the year | 662,100 | ||
Granted | 164,000 | ||
Vested | (109,100) | ||
Canceled/Forfeited | (267,900) | ||
Nonvested Number of shares at the end of the year | 449,100 | 662,100 | |
Weighted Average Grant Date Fair Value Per Share | |||
Nonvested Weighted-Average Grant Date Fair Value at the beginning of the year | $ 17.18 | ||
Granted | 13.75 | $ 20.06 | 18.61 |
Vested | 12.91 | ||
Canceled/Forfeited | 16.80 | ||
Nonvested Weighted-Average Grant Date Fair Value at the end of the year | $ 17.20 | $ 17.18 | |
Market-based Restricted Equity Awards | |||
Number of shares | |||
Nonvested Number of shares at beginning of the year | 176,600 | ||
Granted | 61,000 | ||
Vested | 0 | ||
Canceled/Forfeited | (52,800) | ||
Nonvested Number of shares at the end of the year | 184,800 | 176,600 | |
Weighted Average Grant Date Fair Value Per Share | |||
Nonvested Weighted-Average Grant Date Fair Value at the beginning of the year | $ 16.68 | ||
Granted | 13.34 | $ 19.46 | $ 18.13 |
Vested | 0 | ||
Canceled/Forfeited | 12.25 | ||
Nonvested Weighted-Average Grant Date Fair Value at the end of the year | $ 16.84 | $ 16.68 |
Stock-Based Compensation (Total
Stock-Based Compensation (Total Unrecognized Compensation and Weighted-Average Years Expected to be Recognized) (Details) - Jul. 25, 2015 - USD ($) $ in Millions | Total |
Service-based Restricted Equity Awards | |
Unrecognized Share Based Compensation Expense [Line Items] | |
Total unrecognized compensation | $ 8.5 |
Weighted-average years expected to be recognized over (years) | 3 years |
Performance-based Restricted Equity Awards | |
Unrecognized Share Based Compensation Expense [Line Items] | |
Total unrecognized compensation | $ 1.5 |
Weighted-average years expected to be recognized over (years) | 1 year 10 months 26 days |
Market-based Restricted Equity Awards | |
Unrecognized Share Based Compensation Expense [Line Items] | |
Total unrecognized compensation | $ 0.9 |
Weighted-average years expected to be recognized over (years) | 1 year 8 months 19 days |
Stock-Based Compensation (Addit
Stock-Based Compensation (Additional Information Pertaining to Restricted Equity Awards Activity) (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Service-based Restricted Equity Awards | |||
Schedule of Share based Compensation Arrangements by Share based Payment Award, Equity Instruments, Other Than Options, Restricted Stock Units [Line Items] | |||
Weighted-average grant date fair value of awards granted (dollars per share) | $ 13.96 | $ 19.23 | $ 20.22 |
Total fair value of awards vested | $ 7.1 | $ 12.9 | $ 10 |
Performance-based Restricted Equity Awards | |||
Schedule of Share based Compensation Arrangements by Share based Payment Award, Equity Instruments, Other Than Options, Restricted Stock Units [Line Items] | |||
Weighted-average grant date fair value of awards granted (dollars per share) | $ 13.75 | $ 20.06 | $ 18.61 |
Total fair value of awards vested | $ 1.4 | $ 2.6 | $ 0 |
Market-based Restricted Equity Awards | |||
Schedule of Share based Compensation Arrangements by Share based Payment Award, Equity Instruments, Other Than Options, Restricted Stock Units [Line Items] | |||
Weighted-average grant date fair value of awards granted (dollars per share) | $ 13.34 | $ 19.46 | $ 18.13 |
Total fair value of awards vested | $ 0 | $ 0.6 | $ 0 |
Stock-Based Compensation (Sum84
Stock-Based Compensation (Summary of Cash-Settled Awards) (Details) - Cash Settled LTIP Awards | 12 Months Ended |
Jul. 25, 2015shares | |
Number of shares | |
Nonvested Number of shares at beginning of the year | 858,000 |
Granted | 809,400 |
Vested | (107,500) |
Canceled/Forfeited | (282,000) |
Nonvested Number of shares at the end of the year | 1,277,900 |
Segments (Net Sales and Operati
Segments (Net Sales and Operating Income) (Details) $ in Millions | 12 Months Ended | ||
Jul. 25, 2015USD ($)segment | Jul. 26, 2014USD ($) | Jul. 27, 2013USD ($) | |
Segment Reporting Information [Line Items] | |||
Total net sales | $ 4,802.9 | $ 4,790.6 | $ 4,714.9 |
Total operating (loss) income | (234.9) | 210.8 | 265.3 |
Unallocated acquisition and integration expenses | $ (31.7) | (34) | (34.6) |
Number of reportable segments | segment | 5 | ||
Justice | |||
Segment Reporting Information [Line Items] | |||
Total net sales | $ 1,276.8 | 1,384.3 | 1,407.4 |
Total operating (loss) income | (62.8) | 99.3 | 182.3 |
Lane Bryant | |||
Segment Reporting Information [Line Items] | |||
Total net sales | 1,095.9 | 1,080 | 1,050.1 |
Total operating (loss) income | (308) | (4.3) | (30.1) |
Maurices | |||
Segment Reporting Information [Line Items] | |||
Total net sales | 1,060.6 | 971.4 | 917.6 |
Total operating (loss) income | 125.9 | 86 | 107 |
Dressbarn | |||
Segment Reporting Information [Line Items] | |||
Total net sales | 1,023.6 | 1,022.5 | 1,020.7 |
Total operating (loss) income | 10.7 | 39.4 | 30.3 |
Catherines | |||
Segment Reporting Information [Line Items] | |||
Total net sales | 346 | 332.4 | 319.1 |
Total operating (loss) income | 31 | 24.4 | 10.4 |
Corporate Segment | |||
Segment Reporting Information [Line Items] | |||
Unallocated acquisition and integration expenses | $ (31.7) | $ (34) | $ (34.6) |
Segments (Depreciation and Amor
Segments (Depreciation and Amortization Expense and Capital Expenditures) (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | ||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization expense | $ 218.2 | $ 193.6 | $ 176 | |
Capital expenditures | [1] | 312.5 | 477.5 | 290.9 |
Accrued capital expenditures | 50.8 | 64.4 | 58.9 | |
Justice | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization expense | 70.2 | 60.7 | 56.3 | |
Capital expenditures | 51.5 | 93.5 | 65.9 | |
Lane Bryant | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization expense | 46.8 | 45.6 | 43.7 | |
Capital expenditures | 47.9 | 53.5 | 49.1 | |
Maurices | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization expense | 43.3 | 39.5 | 31.5 | |
Capital expenditures | 56.3 | 54 | 45.1 | |
Dressbarn | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization expense | 50.7 | 40.5 | 38.5 | |
Capital expenditures | 47.6 | 93.5 | 50.3 | |
Catherines | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization expense | 7.2 | 7.3 | 6 | |
Capital expenditures | 6.2 | 7.3 | 2.7 | |
Corporate Segment | ||||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | [2] | $ 103 | $ 175.7 | $ 77.8 |
[1] | Excludes ending accrued capital expenditures of $50.8 million in Fiscal 2015, $64.4 million in Fiscal 2014 and $58.9 million in Fiscal 2013. | |||
[2] | ncludes capital expenditures for technological and supply chain infrastructure and corporate office space. |
Segments (Total Assets) (Detail
Segments (Total Assets) (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |||
Segment Reporting Information [Line Items] | |||||
Assets | $ 2,915.7 | $ 3,123.8 | |||
Impairment of goodwill | 261.7 | [1] | 0 | $ 0 | |
Impairment loss | 44.7 | 13 | $ 0 | ||
Justice | |||||
Segment Reporting Information [Line Items] | |||||
Assets | 826.8 | 858.3 | |||
Lane Bryant | |||||
Segment Reporting Information [Line Items] | |||||
Assets | [2] | 597.3 | 866.4 | ||
Impairment of goodwill | [1] | 261.7 | |||
Impairment loss | 44.7 | ||||
Maurices | |||||
Segment Reporting Information [Line Items] | |||||
Assets | 562.2 | 535.5 | |||
Impairment loss | 13 | ||||
Dressbarn | |||||
Segment Reporting Information [Line Items] | |||||
Assets | 336.1 | 358.2 | |||
Catherines | |||||
Segment Reporting Information [Line Items] | |||||
Assets | 98.9 | 86.6 | |||
Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Assets | [3] | $ 494.4 | $ 418.8 | ||
[1] | Represents accumulated impairment losses as of July 25, 2015. | ||||
[2] | The decrease is primarily due to the impairment losses related to Lane Bryant's goodwill of $261.7 million and trade name of $44.7 million. | ||||
[3] | Includes assets specifically identified as Corporate assets, principally cash, and corporate fixed assets as discussed above. |
Segments Revenue from external
Segments Revenue from external customers by products (Details) | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Revenue from External Customer [Line Items] | |||
Percentage of Total Net Sales | 100.00% | 100.00% | 100.00% |
Apparel | |||
Revenue from External Customer [Line Items] | |||
Percentage of Total Net Sales | 84.00% | 83.00% | 83.00% |
Accessories and other | |||
Revenue from External Customer [Line Items] | |||
Percentage of Total Net Sales | 16.00% | 17.00% | 17.00% |
Additional Financial Informat89
Additional Financial Information (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Accrued capital expenditures | $ 50.8 | $ 64.4 | $ 58.9 |
Additional Financial Informat90
Additional Financial Information (Cash Interest and Taxes) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jul. 25, 2015 | Jul. 26, 2014 | Jul. 27, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Cash paid for interest | $ 4.6 | $ 4.6 | $ 15.6 |
Cash (received) paid for income taxes | $ 5.9 | $ 42.1 | $ 19.7 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) shares in Millions | Aug. 21, 2015 | Oct. 24, 2015 | Jul. 25, 2015 | Jul. 26, 2014 |
Subsequent Event [Line Items] | ||||
Variable-rate term loan | $ 116,000,000 | $ 172,000,000 | ||
ANN | ||||
Subsequent Event [Line Items] | ||||
Transaction costs excluded from purchase price | $ 7,000,000 | |||
Subsequent Event | ANN | ||||
Subsequent Event [Line Items] | ||||
Aggregate purchase price | $ 2,100,000,000 | |||
Purchase price, cash | $ 1,750,000,000 | |||
Number of common shares issued | 31.2 | |||
Subsequent Event | Line of Credit | Term Loan | ANN | ||||
Subsequent Event [Line Items] | ||||
Variable-rate term loan | $ 1,800,000,000 | |||
Scenario, Forecast | Subsequent Event | ANN | ||||
Subsequent Event [Line Items] | ||||
Value of common stock issued | $ 345,000,000 | |||
Transaction costs excluded from purchase price | $ 25,000,000 |
Subsequent Events (Amended Revo
Subsequent Events (Amended Revolving Credit Agreement) (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |
Mar. 31, 2013 | Jul. 25, 2015 | Aug. 31, 2015 | |
Revolving Credit Facility | |||
Subsequent Event [Line Items] | |||
Maximum borrowing capacity | $ 500,000,000 | ||
Optional additional increase in credit facility | $ 100,000,000 | ||
LIBOR | Revolving Credit Facility | |||
Subsequent Event [Line Items] | |||
Basis spread | 1.00% | 1.00% | |
Federal Funds Rate | Revolving Credit Facility | |||
Subsequent Event [Line Items] | |||
Basis spread | 0.50% | 0.50% | |
Minimum | |||
Subsequent Event [Line Items] | |||
Basis spread | 1.25% | ||
Minimum | Revolving Credit Facility | |||
Subsequent Event [Line Items] | |||
Basis spread | 0.50% | 0.25% | |
Commitment fee on unutilized revolving credit facility | 0.25% | 0.20% | |
Maximum | |||
Subsequent Event [Line Items] | |||
Basis spread | 1.50% | ||
Maximum | Revolving Credit Facility | |||
Subsequent Event [Line Items] | |||
Basis spread | 2.00% | 0.50% | |
Commitment fee on unutilized revolving credit facility | 0.375% | 0.25% | |
Subsequent Event | Revolving Credit Facility | |||
Subsequent Event [Line Items] | |||
Optional additional increase in credit facility | $ 200,000,000 | ||
Subsequent Event | Letter of Credit | |||
Subsequent Event [Line Items] | |||
Maximum borrowing capacity | 350,000,000 | ||
Subsequent Event | Standby Letters of Credit | |||
Subsequent Event [Line Items] | |||
Maximum borrowing capacity | 100,000,000 | ||
Subsequent Event | Swingline Loans | |||
Subsequent Event [Line Items] | |||
Maximum borrowing capacity | 30,000,000 | ||
Subsequent Event | ANN | Revolving Credit Facility | |||
Subsequent Event [Line Items] | |||
Previous borrowing capacity | 500,000,000 | ||
Maximum borrowing capacity | $ 600,000,000 |
Subsequent Events (Term Loan) (
Subsequent Events (Term Loan) (Details) - USD ($) | Jul. 25, 2016 | Aug. 21, 2015 | Mar. 31, 2013 | Jul. 24, 2016 | Jul. 25, 2015 | Jul. 28, 2012 | Aug. 31, 2015 | Jul. 26, 2014 |
Subsequent Event [Line Items] | ||||||||
Variable-rate term loan | $ 116,000,000 | $ 172,000,000 | ||||||
Term Loan | ||||||||
Subsequent Event [Line Items] | ||||||||
Debt Instrument, Term | 6 years | |||||||
Revolving Credit Facility | ||||||||
Subsequent Event [Line Items] | ||||||||
Maximum borrowing capacity | $ 500,000,000 | |||||||
Federal Funds Rate | Revolving Credit Facility | ||||||||
Subsequent Event [Line Items] | ||||||||
Basis spread | 0.50% | 0.50% | ||||||
Minimum | ||||||||
Subsequent Event [Line Items] | ||||||||
Basis spread | 1.25% | |||||||
Minimum | Revolving Credit Facility | ||||||||
Subsequent Event [Line Items] | ||||||||
Basis spread | 0.50% | 0.25% | ||||||
Commitment fee on unutilized revolving credit facility | 0.25% | 0.20% | ||||||
Maximum | ||||||||
Subsequent Event [Line Items] | ||||||||
Basis spread | 1.50% | |||||||
Maximum | Revolving Credit Facility | ||||||||
Subsequent Event [Line Items] | ||||||||
Basis spread | 2.00% | 0.50% | ||||||
Commitment fee on unutilized revolving credit facility | 0.375% | 0.25% | ||||||
Subsequent Event | ANN | Line of Credit | Term Loan | ||||||||
Subsequent Event [Line Items] | ||||||||
Variable-rate term loan | $ 1,800,000,000 | |||||||
Maximum borrowing capacity | 200,000,000 | |||||||
Remaining balloon payment requited at maturity | 1,300,000,000 | |||||||
Original issue discount | 36,000,000 | |||||||
Subsequent Event | Revolving Credit Facility | ANN | ||||||||
Subsequent Event [Line Items] | ||||||||
Maximum borrowing capacity | $ 600,000,000 | |||||||
Subsequent Event | Scenario, Forecast | ANN | Line of Credit | Term Loan | ||||||||
Subsequent Event [Line Items] | ||||||||
Mandatory quarterly repayments in calendar 2016 and thereafter | $ 22,500,000 | $ 4,500,000 | ||||||
Threshold for repayment, net proceeds of asset dispositions and certain casualty events | $ 25,000,000 |
Subsequent Events (Restrictions
Subsequent Events (Restrictions under the Term Loan and the Amended Revolving Credit Agreement) (Details) | Aug. 21, 2015USD ($) |
Subsequent Event | Line of Credit | Borrowing Agreements | |
Subsequent Event [Line Items] | |
Availability threshold for Covenant Period | $ 45,000,000 |