Document_and_Entity_Informatio
Document and Entity Information Document | 9 Months Ended | |
Nov. 01, 2014 | Dec. 04, 2014 | |
Document and Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 1-Nov-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Entity Registrant Name | 'Sears Hometown & Outlet Stores, Inc. | ' |
Entity Central Index Key | '0001548309 | ' |
Current Fiscal Year End Date | '--01-31 | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 22,735,849 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Nov. 01, 2014 | Nov. 02, 2013 | Nov. 01, 2014 | Nov. 02, 2013 |
NET SALES | $565,147 | $561,068 | $1,793,694 | $1,819,084 |
COSTS AND EXPENSES | ' | ' | ' | ' |
Cost of sales and occupancy | 430,085 | 425,596 | 1,367,644 | 1,380,966 |
Selling and administrative | 139,766 | 121,698 | 414,271 | 379,815 |
Impairment of goodwill | 167,000 | 0 | 167,000 | 0 |
Depreciation | 2,035 | 2,177 | 6,390 | 6,569 |
Gain on the sale of assets | -155 | -1,567 | -155 | -1,567 |
Total costs and expenses | 738,731 | 547,904 | 1,955,150 | 1,765,783 |
Operating income (loss) | -173,584 | 13,164 | -161,456 | 53,301 |
Interest expense | -915 | -738 | -2,754 | -1,969 |
Other income | 888 | 460 | 2,366 | 1,306 |
Income (loss) before income taxes | -173,611 | 12,886 | -161,844 | 52,638 |
Income tax benefit (expense) | 2,401 | -5,191 | -2,327 | -20,812 |
NET INCOME (LOSS) | ($171,210) | $7,695 | ($164,171) | $31,826 |
NET INCOME PER COMMON SHARE ATTRIBUTABLE TO STOCKHOLDERS | ' | ' | ' | ' |
Basic (in dollars per share) | ($7.55) | $0.33 | ($7.24) | $1.38 |
Diluted (in dollars per share) | ($7.55) | $0.33 | ($7.24) | $1.38 |
Basic weighted average common shares outstanding (in shares) | 22,666 | 22,999 | 22,666 | 23,066 |
Diluted weighted average common shares outstanding (in shares) | 22,666 | 22,999 | 22,666 | 23,070 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Nov. 01, 2014 | Feb. 01, 2014 | Nov. 02, 2013 |
In Thousands, unless otherwise specified | |||
CURRENT ASSETS | ' | ' | ' |
Cash and cash equivalents | $23,189 | $23,475 | $21,487 |
Accounts and notes receivable | 20,930 | 19,252 | 17,207 |
Merchandise inventories | 462,226 | 482,107 | 488,626 |
Prepaid expenses and other current assets | 17,893 | 13,216 | 8,113 |
Total current assets | 524,238 | 538,050 | 535,433 |
PROPERTY AND EQUIPMENT, net | 50,454 | 48,973 | 49,544 |
GOODWILL | 0 | 167,000 | 167,000 |
LONG-TERM DEFERRED TAXES | 47,359 | 52,672 | 63,916 |
OTHER ASSETS | 41,185 | 40,490 | 32,115 |
TOTAL ASSETS | 663,236 | 847,185 | 848,008 |
CURRENT LIABILITIES | ' | ' | ' |
Short-term borrowings | 73,200 | 99,100 | 87,900 |
Payable to Sears Holdings Corporation | 79,940 | 68,396 | 57,414 |
Accounts payable | 20,238 | 24,129 | 31,727 |
Other current liabilities | 60,079 | 60,319 | 74,306 |
Current portion of capital lease obligations | 75 | 662 | 1,082 |
Total current liabilities | 233,532 | 252,606 | 252,429 |
CAPITAL LEASE OBLIGATIONS | 136 | 95 | 98 |
OTHER LONG-TERM LIABILITIES | 2,908 | 4,259 | 5,139 |
TOTAL LIABILITIES | 236,576 | 256,960 | 257,666 |
COMMITMENTS AND CONTINGENCIES (Note 9) | ' | ' | ' |
STOCKHOLDERS' EQUITY | ' | ' | ' |
TOTAL STOCKHOLDERS' EQUITY | 426,660 | 590,225 | 590,342 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $663,236 | $847,185 | $848,008 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
Nov. 01, 2014 | Nov. 02, 2013 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' |
Net income (loss) | ($164,171,000) | $31,826,000 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ' | ' |
Depreciation | 6,390,000 | 6,569,000 |
Share-based compensation | 606,000 | 598,000 |
Gain on the sale of assets | -155,000 | -1,567,000 |
Impairment of goodwill | 167,000,000 | 0 |
Provision for losses on franchisee receivables | 11,526,000 | 0 |
Change in operating assets and liabilities: | ' | ' |
Accounts and notes receivable | -14,517,000 | -16,216,000 |
Merchandise inventories | 19,881,000 | -60,189,000 |
Payable to Sears Holdings Corporation | 11,544,000 | -22,077,000 |
Accounts payable | -3,891,000 | -103,000 |
Customer deposits | -3,225,000 | 5,998,000 |
Deferred income taxes | 785,000 | 15,520,000 |
Other operating assets | 2,639,000 | 1,246,000 |
Other operating liabilities | 1,673,000 | -15,767,000 |
Net cash provided by (used in) operating activities | 36,085,000 | -54,162,000 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' |
Proceeds from sales of property and investments | 155,000 | 2,641,000 |
Purchases of property and equipment | -10,039,000 | -5,995,000 |
Net cash used in investing activities | -9,884,000 | -3,354,000 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' |
Common stock repurchased and retired | 0 | -8,369,000 |
Payments of capital lease obligations | -587,000 | -596,000 |
Net short-term borrowings (payments) | -25,900,000 | 67,900,000 |
Net cash provided by (used in) financing activities | -26,487,000 | 58,935,000 |
NET CHANGE IN CASH AND CASH EQUIVALENTS | -286,000 | 1,419,000 |
CASH AND CASH EQUIVALENTSbBeginning of period | 23,475,000 | 20,068,000 |
CASH AND CASH EQUIVALENTSbEnd of period | 23,189,000 | 21,487,000 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ' | ' |
Cash paid for interest | 2,466,000 | 2,012,000 |
Cash paid for income taxes | $246,000 | $19,355,000 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Stockholders' Equity (USD $) | Total | Common Stock [Member] | Capital in Excess of Par Value [Member] | Retained Earnings (Deficit) [Member] |
In Thousands, unless otherwise specified | ||||
Beginning balance at Feb. 02, 2013 | $566,287 | $231 | $556,575 | $9,481 |
Beginning balance, Shares at Feb. 02, 2013 | ' | 23,100 | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' |
Net income (loss) | 31,826 | ' | ' | 31,826 |
Share-based compensation | 598 | 1 | 597 | ' |
Share-based compensation, Shares | ' | 88 | ' | ' |
Common stock repurchased and retired | -8,369 | -3 | -6,728 | -1,638 |
Common stock repurchased and retired, shares | ' | -279 | ' | ' |
Ending balance at Nov. 02, 2013 | 590,342 | 229 | 550,444 | 39,669 |
Ending balance, Shares at Nov. 02, 2013 | ' | 22,909 | ' | ' |
Beginning balance at Feb. 01, 2014 | 590,225 | 228 | 547,021 | 42,976 |
Beginning balance, Shares at Feb. 01, 2014 | ' | 22,753 | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' |
Net income (loss) | -164,171 | ' | ' | -164,171 |
Share-based compensation | 606 | -1 | 607 | ' |
Share-based compensation, Shares | ' | -17 | ' | ' |
Ending balance at Nov. 01, 2014 | $426,660 | $227 | $547,628 | ($121,195) |
Ending balance, Shares at Nov. 01, 2014 | ' | 22,736 | ' | ' |
Background_and_Basis_of_Presen
Background and Basis of Presentation | 9 Months Ended |
Nov. 01, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
BACKGROUND AND BASIS OF PRESENTATION | ' |
BACKGROUND AND BASIS OF PRESENTATION | |
Background | |
Sears Hometown and Outlet Stores, Inc. is a national retailer primarily focused on selling home appliances, hardware, tools, and lawn and garden equipment. As of November 1, 2014 the Company and its dealers and franchisees operated 1,257 stores across all 50 states and in Puerto Rico and Bermuda. In these notes and elsewhere in this Quarterly Report on Form 10-Q the terms “we,” “us,” “our,” “SHO,” and the “Company” refer to Sears Hometown and Outlet Stores, Inc. and its subsidiaries. | |
Description of the Separation | |
On October 11, 2012, Sears Holdings Corporation (“Sears Holdings”) completed the separation of its Sears Hometown and Hardware and Sears Outlet businesses (the “Separation”). As part of the Separation, through a series of intercompany transactions, Sears Holdings and several of its subsidiaries transferred the assets and liabilities comprising the Sears Hometown and Hardware and Sears Outlet businesses to Sears Hometown and Outlet Stores, Inc., which was formed prior to the Separation as a wholly owned subsidiary of Sears Holdings. Effective upon the Separation, Sears Holdings ceased to own shares of our common stock, and thereafter our common stock began trading on the NASDAQ Stock Market under the trading symbol “SHOS.” | |
Basis of Presentation | |
These unaudited condensed consolidated financial statements include the accounts of Sears Hometown and Outlet Stores, Inc. and its subsidiaries, all of which are wholly owned. These unaudited condensed consolidated financial statements do not include all of the information and footnotes required in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). In the opinion of management, all adjustments (which include normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the fiscal quarter ended November 1, 2014 are not necessarily indicative of the results that may be expected for the full fiscal year. These financial statements and related notes should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended February 1, 2014. | |
We operate through two segments--our Sears Hometown and Hardware segment ("Hometown") and our Sears Outlet segment ("Outlet"). | |
Our fiscal year end is the Saturday closest to January 31 each year. Our third fiscal-quarter end is the Saturday closest to October 31 each year. | |
Variable Interest Entities and Consolidation | |
The Financial Accounting Standards Board ("FASB") has issued guidance on variable interest entities and consolidation for determining whether an entity is a variable interest entity as well as the methods permitted for determining the primary beneficiary of a variable interest entity. In addition, this guidance requires ongoing reassessments of whether a company is the primary beneficiary of a variable interest entity and disclosures related to a company’s involvement with a variable interest entity. | |
On an ongoing basis the Company evaluates its business relationships, such as those with its dealers, franchisees, and suppliers, to identify potential variable interest entities. Generally, these businesses qualify for a scope exception under the consolidation guidance, or, where a variable interest exists, the Company does not possess the power to direct the activities that most significantly impact the economic performance of these businesses. The Company has not consolidated any of such entities in the periods presented. | |
Fair Value of Financial Instruments | |
We determine the fair value of financial instruments in accordance with standards pertaining to fair value measurements. Such standards define fair value and establish a framework for measuring fair value under GAAP. Under fair value measurement accounting standards, fair value is considered to be the exchange price in an orderly transaction between market participants to sell an asset or transfer a liability at the measurement date. We report the fair value of financial assets and liabilities based on the fair value hierarchy prescribed by accounting standards for fair value measurements, which prioritizes the inputs to valuation techniques used to measure fair value into three levels, as follows: | |
Level 1 inputs—unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access. An active market for the asset or liability is one in which transactions for the asset or liability occurs with sufficient frequency and volume to provide ongoing pricing information. | |
Level 2 inputs—inputs other than quoted market prices included in Level 1 that are observable, either directly or indirectly, for the asset or liability. Level 2 inputs include, but are not limited to, quoted prices for similar assets or liabilities in an active market, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs other than quoted market prices that are observable for the asset or liability, such as interest-rate curves and yield curves observable at commonly quoted intervals, volatilities, credit risks, and default rates. | |
Level 3 inputs—unobservable inputs for the asset or liability. | |
Cash and cash equivalents (level 1), accounts and notes receivable, short-term debt (level 2), merchandise payables, and accrued expenses are reflected in the Condensed Consolidated Balance Sheets at cost, which approximates fair value due to the short-term nature of these instruments. For short-term debt, the variable interest rates are a significant input in our fair value assessments. The carrying value of long-term notes receivable approximates fair value. | |
We measure certain non-financial assets and liabilities, including long-lived assets, at fair value on a non-recurring basis. As disclosed in Note 4, the Company recorded a goodwill impairment charge during the quarter ended November 1, 2014. The Company utilized Level 3 inputs to measure the fair value of goodwill. | |
Recent Accounting Pronouncements | |
Revenue from Contracts with Customers | |
In May 2014, the FASB issued an accounting standards update which establishes a comprehensive revenue recognition standard in U.S. GAAP for virtually all industries, including those that previously followed industry-specific guidance such as the real estate, construction, and software industries. The update is effective in fiscal 2017, and we are currently evaluating the potential impact. Accordingly, we cannot estimate the effect on our consolidated financial position, results of operations, or cash flows. |
Accounts_and_Notes_Receivable_
Accounts and Notes Receivable and Other Assets | 9 Months Ended | ||||||||||||
Nov. 01, 2014 | |||||||||||||
Receivables [Abstract] | ' | ||||||||||||
Accounts and Notes Receivable and Other Assets | ' | ||||||||||||
ACCOUNTS AND FRANCHISEE RECEIVABLES AND OTHER ASSETS | |||||||||||||
Accounts and franchisee receivables and other assets consist of the following: | |||||||||||||
November 1, | |||||||||||||
2014 | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Short-term franchisee receivables | $ | 8,129 | $ | 4,463 | $ | 12,592 | |||||||
Miscellaneous receivables | 7,609 | 2,112 | 9,721 | ||||||||||
Long-term franchisee receivables | 21,246 | 27,688 | 48,934 | ||||||||||
Other assets | 2,112 | 282 | 2,394 | ||||||||||
Provision for losses on short-term franchisee receivables (1) | (1,383 | ) | — | (1,383 | ) | ||||||||
Provision for losses on long-term franchisee receivables (1) | (10,143 | ) | — | (10,143 | ) | ||||||||
Total Accounts and franchisee receivables and other assets | $ | 27,570 | $ | 34,545 | $ | 62,115 | |||||||
November 2, | |||||||||||||
2013 | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Short-term franchisee receivables | $ | 2,676 | $ | 896 | $ | 3,572 | |||||||
Miscellaneous receivables | 13,198 | 437 | 13,635 | ||||||||||
Long-term franchisee receivables | 21,090 | 7,974 | 29,064 | ||||||||||
Other assets | 2,844 | 207 | 3,051 | ||||||||||
Total Accounts and franchisee receivables and other assets | $ | 39,808 | $ | 9,514 | $ | 49,322 | |||||||
February 1, | |||||||||||||
2014 | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Short-term franchisee receivables | $ | 2,748 | $ | 1,844 | $ | 4,592 | |||||||
Miscellaneous receivables | 13,029 | 1,631 | 14,660 | ||||||||||
Long-term franchisee receivables | 21,207 | 16,409 | 37,616 | ||||||||||
Other assets | 2,662 | 212 | 2,874 | ||||||||||
Total Accounts and franchisee receivables and other assets | $ | 39,646 | $ | 20,096 | $ | 59,742 | |||||||
(1) The Company recognizes a provision for losses on franchisee receivables (which consist primarily of franchisee promissory notes) in an amount equal to estimated probable losses net of recoveries. The provision is based on an analysis of expected future write-offs, existing economic conditions, and an assessment of specific identifiable franchisee promissory notes and other franchisee receivables considered at risk or uncollectible. The expense associated with the provision for losses on franchisee receivables is recognized as selling, general, and administrative expense. Most of our franchisee promissory notes authorize us to deduct debt service from our commissions otherwise due and payable to the franchisees, and we routinely make those deductions to the extent of available commissions payable. We established the provision for losses on franchisee receivables in the third quarter of fiscal 2014 based on our receivable-by-receivable assessment during the quarter that some of the Hometown franchisee receivables were potentially uncollectible in future periods due to (a) declining results of operations of, or other adverse financial events with respect to, Hometown franchise stores that indicated that the franchisees might not be able to meet their debt-service and other obligations to us as they became due and (b) the refusal during the quarter of one of our Hometown franchisees to continue to operate its franchise stores in accordance with the franchisee's agreements with us. Based on our assessment during the quarter we made no provision for losses on Outlet franchisee receivables. |
Other_Current_and_LongTerm_Lia
Other Current and Long-Term Liabilities | 9 Months Ended | ||||||||||||
Nov. 01, 2014 | |||||||||||||
Payables and Accruals [Abstract] | ' | ||||||||||||
OTHER CURRENT AND LONG-TERM LIABILITIES | ' | ||||||||||||
OTHER CURRENT AND LONG-TERM LIABILITIES | |||||||||||||
Other current and long-term liabilities consist of the following: | |||||||||||||
Thousands | November 1, | November 2, | February 1, | ||||||||||
2014 | 2013 | 2014 | |||||||||||
Customer deposits | $ | 32,322 | $ | 40,913 | $ | 35,547 | |||||||
Sales and other taxes | 14,052 | 14,072 | 11,403 | ||||||||||
Accrued expenses | 10,617 | 13,267 | 9,523 | ||||||||||
Payroll and related items | 5,996 | 11,193 | 8,105 | ||||||||||
Total Other current and long-term liabilities | $ | 62,987 | $ | 79,445 | $ | 64,578 | |||||||
Goodwill
Goodwill | 9 Months Ended | ||||||||||||
Nov. 01, 2014 | |||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ||||||||||||
Goodwill | ' | ||||||||||||
GOODWILL | |||||||||||||
Goodwill allocated to our Hometown and Outlet segments as of November 1, 2014, and changes in the carrying amount of goodwill for the nine months ended November 1, 2014, are as follows: | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Balance (gross) at February 1, 2014 | $ | 167,000 | $ | — | $ | 167,000 | |||||||
Impairment Loss | (167,000 | ) | — | (167,000 | ) | ||||||||
Balance at November 1, 2014 | $ | — | $ | — | $ | — | |||||||
For the first nine months of fiscal 2014, the decrease in goodwill is due entirely to the non-cash impairment loss with respect to the Hometown Reporting Unit as discussed further below. | |||||||||||||
We review the Hometown Stores and Home Appliance Showrooms ("Hometown Reporting Unit") goodwill for impairment annually at the beginning of the fourth fiscal quarter and whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. The goodwill impairment test involves a two-step process. In the first step, SHO compares the fair value of the Hometown Reporting Unit to its carrying value. If the fair value of the Hometown Reporting Unit exceeds its carrying value, goodwill is not impaired and no further testing is required. If the fair value of the Hometown Reporting Unit is less than its carrying value, SHO must perform the second step of the impairment test to measure the amount of impairment loss. In the second step, the Hometown Reporting Unit's fair value is allocated to all of the assets and liabilities of the Hometown Reporting Unit, including any unrecognized intangible assets, in a hypothetical analysis that calculates the implied fair value of goodwill in the same manner as if the Hometown Reporting Unit were being acquired in a business combination. If the implied fair value of the Hometown Reporting Unit's goodwill is less than its carrying value, the difference is recorded as a non-cash impairment loss. | |||||||||||||
During the third quarter of fiscal 2014, we determined that sufficient indicators of potential impairment existed to require that we conduct an interim impairment analysis of the Hometown Reporting Unit's goodwill. These indicators included a significant and sustained decline in the recent trading values of SHO's stock, coupled with market conditions and business trends affecting the Hometown Reporting Unit. The primary operating factors were declines in revenue and profitability for fiscal 2014. Merchandise revenues in fiscal 2014 were impacted by the highly promotional environment, along with other factors that caused declines in comparable store sales and related profitability below expectations for the Hometown Reporting Unit. | |||||||||||||
SHO estimated the fair value of the Hometown Reporting Unit using a weighting of fair values derived from the income approach and the market approach. Under the income approach, SHO calculated the fair value of the Hometown Reporting Unit based on the present value of the Hometown Reporting Unit's estimated future cash flows. The cash flow projections were based on management's estimates of revenue growth rates and operating margins, taking into consideration industry and market conditions. SHO used a discount rate that was based on a weighted average cost of capital adjusted for the relevant risk associated with the characteristics of the Hometown Reporting Unit and its projected cash flows. SHO's market approach used estimated fair values based on market multiples of revenue and earnings derived from comparable publicly traded companies with operating and investment characteristics that were comparable to the operating and investment characteristics of the Hometown Reporting Unit. | |||||||||||||
Due to the complexity and the effort required to estimate the fair value of the Hometown Reporting Unit for the first step of the impairment test and to estimate the fair values of all assets and liabilities of the Hometown Reporting Unit for the second step of the impairment test, SHO used fair value estimates that were derived based on assumptions and analyses that are subject to change. SHO’s first-step evaluation concluded that the fair value of the Hometown Reporting Unit was substantially below its carrying value. Based on SHO's second-step analyses, the implied fair value of the Hometown Reporting Unit's goodwill was $0. As a result, a full impairment of goodwill was required and we recorded a $167.0 million non-cash goodwill impairment charge in the third quarter of fiscal 2014, which is reflected as "Impairment of goodwill" in the Condensed Consolidated Statements of Operations. The primary factor that contributed to the goodwill impairment loss was the aforementioned 2014 operating issues leading to less-optimistic forecasts for the remainder of fiscal 2014 and fiscal 2015 and the corresponding impact beyond those periods. |
Income_Taxes
Income Taxes | 9 Months Ended |
Nov. 01, 2014 | |
Income Tax Disclosure [Abstract] | ' |
Income Taxes | ' |
INCOME TAXES | |
In connection with the Separation, SHO and Sears Holdings entered into a Tax Sharing Agreement that governs the rights and obligations of the parties with respect to pre-Separation and post-Separation tax matters. Under the Tax Sharing Agreement, Sears Holdings generally is responsible for any federal, state, or foreign income tax liability relating to tax periods ending on or before the Separation. For all periods after the Separation, the Company generally is responsible for any federal, state, or foreign tax liability. Current income taxes payable for any federal, state, or foreign income tax returns is reported in the period incurred. | |
We account for uncertainties in income taxes according to accounting standards for uncertain tax positions. The Company is present in a large number of taxable jurisdictions and, at any point in time, can have audits underway at various stages of completion in one or more of these jurisdictions. We evaluate our tax positions and establish liabilities for uncertain tax positions that may be challenged by local authorities and may not be fully sustained, despite our belief that the underlying tax positions are fully supportable. Unrecognized tax benefits are reviewed on an ongoing basis and are adjusted in light of changing facts and circumstances, including progress of tax audits, developments in case law, and closings of statutes of limitation. Such adjustments are reflected in the tax provision as appropriate. For the 39 Weeks ended November 1, 2014 and November 2, 2013, no unrecognized tax benefits have been identified and reflected in the financial statements. | |
We classify interest expense and penalties related to unrecognized tax benefits and interest income on tax overpayments as components of income tax expense. As no unrecognized tax benefits have been identified and reflected in the condensed consolidated financial statements, no interest or penalties related to unrecognized tax benefits are reflected in the condensed consolidated balance sheets or statements of operations. | |
As of November 1, 2014 the Company's net deferred tax asset balance was $57.2 million compared to $61.1 million as of November 2, 2013 and $58.0 million as of February 1, 2014. |
Related_Party_Agreements_and_T
Related Party Agreements and Transactions | 9 Months Ended | ||||||||||||||||
Nov. 01, 2014 | |||||||||||||||||
Related Party Transactions [Abstract] | ' | ||||||||||||||||
RELATED-PARTY AGREEMENTS AND TRANSACTIONS | ' | ||||||||||||||||
RELATED-PARTY AGREEMENTS AND TRANSACTIONS | |||||||||||||||||
According to publicly available information ESL Investments, Inc. and its investment affiliates beneficially own approximately 47% of our outstanding shares of common stock and approximately 56% of Sears Holdings' outstanding shares of common stock. | |||||||||||||||||
In connection with the Separation, we entered into various agreements with Sears Holdings (the "SHO-Sears Holdings Agreements") that, among other things, (1) govern specified aspects of our relationship with Sears Holdings, (2) establish terms under which subsidiaries of Sears Holdings provide services to us, and (3) establish terms pursuant to which subsidiaries of Sears Holdings obtain merchandise inventories for us. The terms of the SHO-Sears Holdings Agreements were agreed to prior to the Separation in the context of a parent-subsidiary relationship and in the overall context of the Separation. The costs and allocations charged to the Company by Sears Holdings do not necessarily reflect the costs of obtaining the services from unaffiliated third parties or of the Company itself providing the applicable services. The Company engages in frequent discussions, and seeks to resolve disputes, with Sears Holdings about the terms and conditions of the SHO-Sears Holdings Agreements, the business relationships that are reflected in the SHO-Sears Holdings Agreements, and the details of these business relationships, many of which details are not addressed by the terms and conditions of the SHO-Sears Holdings Agreements or, if addressed, are in dispute as to their meaning or application in the context of the existing business relationships. Some of these discussions have resulted in adjustments to the relationships that the Company believes together are in Company's best interests. In many other instances the Company's dispute-resolution efforts, which are continuing, have yet to resolve the underlying disputes. | |||||||||||||||||
The following is a summary of the nature of the related-party transactions between SHO and Sears Holdings: | |||||||||||||||||
• | SHO receives commissions from Sears Holdings for specified sales of merchandise made through www.sears.com and www.searsoutlet.com, the sale of extended service contracts, delivery and handling services, and relating to the use in our stores of credit cards branded with the Sears name. For specified transactions SHO pays a commission to Sears Holdings. | ||||||||||||||||
• | We obtain a significant amount of our merchandise inventories from Sears Holdings. We have a retailer's customary rights to return to Sears Holdings merchandise that is defective (except with respect to agreed-upon amounts of defective apparel that we purchase and then liquidate) or otherwise does not meet contract requirements. In addition, we may determine that an item of Outlet merchandise (usually merchandise that is not new in-box) we have received from Sears Holdings cannot be refurbished or reconditioned or is otherwise not in a physical condition to offer for sale to our customers. We and Sears Holdings (and our Outlet vendors generally) refer to an item of merchandise in this condition as “not saleable” or "non-saleable," and in the normal course we can return the item to Sears Holdings. We generally have comparable return rights with our other Outlet vendors. | ||||||||||||||||
• | We pay royalties related to our sale of products branded with the KENMORE®, CRAFTSMAN®, and DIEHARD® marks (which marks are owned by subsidiaries of Sears Holdings). | ||||||||||||||||
• | We pay fees for participation in Sears Holdings' SHOP YOUR WAY REWARDS® program. | ||||||||||||||||
• | We have also entered into agreements with Sears Holdings for logistics, handling, warehouse, and transportation services, the charges for which are based generally on merchandise inventory units. | ||||||||||||||||
• | Sears Holdings provides the Company with specified corporate services. These services include accounting and finance, human resources, and information technology, among other services. Sears Holdings charges the Company for these corporate services based on actual usage or pro rata charges based upon sales, head count, or other measurements. | ||||||||||||||||
• | Sears Holdings leases stores and distribution/repair facilities to the Company, for which the Company pays rent and related occupancy charges to Sears Holdings. | ||||||||||||||||
The following table summarizes the results of the transactions with Sears Holdings reflected in the Company’s Condensed Consolidated Financial Statements: | |||||||||||||||||
13 Weeks Ended | 39 Weeks Ended | ||||||||||||||||
November 1, | November 2, | November 1, | November 2, | ||||||||||||||
Thousands | 2014 | 2013 | 2014 | 2013 | |||||||||||||
Net Commissions from Sears Holdings | $ | 22,069 | $ | 21,424 | $ | 76,808 | $ | 68,327 | |||||||||
Purchases related to cost of sales and occupancy (1) | 351,935 | 395,178 | 1,156,632 | 1,224,254 | |||||||||||||
Services (1) | 23,302 | 29,410 | 73,089 | 85,655 | |||||||||||||
(1) Amounts previously presented for the 13 and 39 Weeks ended November 2, 2013 and for the 13 weeks ended May 3, 2014 within "Purchases related to cost of sales and occupancy" have been reclassified into "Services." The reclassified items were primarily costs associated with marketing. The reclassified amount for the 13 weeks ended November 2, 2013 was $23.8 million. The reclassified amounts for the 39 Weeks ended November 2, 2013 and November 1, 2014 were $69.6 million and $20.3 million, respectively. | |||||||||||||||||
We incur payables to Sears Holdings for merchandise inventory purchases and service and occupancy charges (net of commissions) based on the SHO-Sears Holdings Agreements. Amounts due to or from Sears Holdings are non-interest bearing and are settled on a net basis. We generally pay undisputed amounts within 10 days after the invoice date. |
Financing_Arrangements
Financing Arrangements | 9 Months Ended |
Nov. 01, 2014 | |
Debt Disclosure [Abstract] | ' |
Financing Arrangements | ' |
FINANCING ARRANGEMENT | |
As of November 1, 2014 we had $73.2 million outstanding under our asset-based senior secured revolving credit facility with a group of financial institutions (the “Senior ABL Facility”), which approximated the fair value of these borrowings. The Senior ABL Facility provides (subject to availability under a borrowing base) for maximum borrowings up to the aggregate commitments of all of the lenders, which as of November 1, 2014 totaled $250 million. Up to $75 million of the Senior ABL Facility is available for the issuance of letters of credit and up to $25 million is available for swingline loans. The Senior ABL Facility permits us to request commitment increases in an aggregate principal amount of up to $100 million. Availability under the Senior ABL Facility as of November 1, 2014 was $171.2 million, with $5.6 million of letters of credit outstanding under the facility. | |
The principal terms of the Senior ABL Facility are summarized below. | |
Senior ABL Facility | |
Maturity; Amortization and Prepayments | |
The Senior ABL Facility will mature on the earlier of (i) October 11, 2017 or (ii) six months prior to the expiration of our Merchandising Agreement with Sears Holdings (the "Merchandising Agreement") and the other agreements with Sears Holdings or its subsidiaries in connection with the Separation that are specified in the Senior ABL Facility, unless such agreements have been extended to a date later than October 11, 2017 or terminated on a basis reasonably satisfactory to the administrative agent under the Senior ABL Facility. | |
The Senior ABL Facility is subject to mandatory prepayment in amounts equal to the amount by which the outstanding extensions of credit exceed the lesser of the borrowing base and the commitments then in effect. | |
Guarantees; Security | |
The obligations under the Senior ABL Facility are guaranteed by us and each of our existing and future direct and indirect wholly owned domestic subsidiaries (subject to certain exceptions). The Senior ABL Facility and the guarantees thereunder are secured by a first priority security interest in assets of the borrowers and guarantors consisting primarily of accounts and notes receivable, inventory, cash, cash equivalents, deposit accounts and securities accounts, as well as certain other assets (other than intellectual property) ancillary to the foregoing and all proceeds of all of the foregoing, including cash proceeds and the proceeds of applicable insurance. | |
Interest; Fees | |
The interest rates per annum applicable to the loans under the Senior ABL Facility are based on a fluctuating rate of interest measured by reference to, at our election, either (1) an adjusted London inter-bank offered rate (LIBOR) plus a borrowing margin, which rate was approximately 2.41% at November 1, 2014 or (2) an alternate base rate plus a borrowing margin, with the borrowing margin subject to adjustment based on the average excess availability under the Senior ABL Facility for the preceding fiscal quarter, which rate was approximately 4.50% at November 1, 2014. | |
Customary fees are payable in respect of the Senior ABL Facility, including letter of credit fees and commitment fees. | |
Covenants | |
The Senior ABL Facility includes a number of covenants that, among other things, limit or restrict our ability to, subject to specified exceptions, incur additional indebtedness (including guarantees), grant liens, make investments, make prepayments on other indebtedness, engage in mergers, or change the nature of our business. | |
The Senior ABL Facility limits SHO's ability to declare and pay cash dividends and repurchase its common stock. SHO may declare and pay cash dividends to its stockholders and may repurchase stock if the following conditions are satisfied: either (a) (i) no specified default then exists or would arise as a result of the declaration or payment of the cash dividend or as a result of the stock repurchase, (ii) SHO and its subsidiaries that are also borrowers have demonstrated to the reasonable satisfaction of the agent for the lenders that monthly availability (as determined in accordance with the Senior ABL Facility), immediately following the declaration and payment of the cash dividend or the stock repurchase and as projected on a pro forma basis for the twelve months following and after giving effect to the declaration and payment of the cash dividend or the stock repurchase, would be at least equal to the greater of (x) 25% of the Loan Cap (which is the lesser of (A) the aggregate commitments of the lenders and (B) the borrowing base) and (y) $50,000,000, and (iii) after giving pro forma effect to the declaration and payment of the cash dividend or the stock repurchase as if it constituted a specified debt service charge, the specified consolidated fixed charge coverage ratio, as calculated on a trailing twelve months basis, would be equal to or greater than 1.1:1.0, or (b) (i) no specified default then exists or would arise as a result of the declaration or payment of the cash dividend or the stock repurchase, (ii) payment of the cash dividend or the stock repurchase is not made with the proceeds of any credit extension under the Senior ABL Facility, (iii) during the 120-day period prior to declaration and payment of the cash dividend or the stock repurchase, no credit extension was outstanding under the Senior ABL Facility, and (iv) SHO demonstrates to the reasonable satisfaction of the agent for the lenders that, on a pro forma and projected basis, no credit extensions would be outstanding under the Senior ABL Facility for the 120-day period following the declaration and payment of the cash dividend or the stock repurchase. No default or event of default presently exists. | |
The Senior ABL Facility also contains certain affirmative covenants, including financial and other reporting requirements. | |
Events of Default | |
The Senior ABL Facility includes customary events of default including non-payment of principal, interest or fees, violation of covenants, inaccuracy of representations or warranties, cross default to certain other material indebtedness, bankruptcy and insolvency events, invalidity or impairment of guarantees or security interests, material judgments, change of control, failure to perform a "Material Contract" (which includes the Merchandising Agreement and other SHO-Sears Holdings Agreements) to the extent required to maintain it in full force and effect, and the failure to enforce a Material Contract in accordance with its terms. |
Summary_of_Segment_Data
Summary of Segment Data | 9 Months Ended | ||||||||||||
Nov. 01, 2014 | |||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||
SUMMARY OF SEGMENT DATA | ' | ||||||||||||
SUMMARY OF SEGMENT DATA | |||||||||||||
The Hometown reportable segment consists of the aggregation of our Hometown Stores, Hardware Stores, and Home Appliance Showrooms business formats described in “Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations-Executive Overview" of this Quarterly Report on Form 10-Q. The Outlet reportable segment also represents a business format. These segments are evaluated by our Chief Operating Decision Maker to make decisions about resource allocation and to assess performance. Each of these segments derives its revenues from the sale of merchandise and related services to customers, primarily in the U.S. The net sales categories include appliances, lawn and garden, tools and paint, and other (which includes initial franchise revenue of $6.5 million and $7.8 million for the 13 weeks ended November 1, 2014 and the 13 weeks ended November 2, 2013, respectively). For the 39 Weeks ended November 1, 2014, initial franchise revenue (which consists of franchise fees paid with respect to new or existing Company-operated stores that we transfer to franchisees plus the net gain or loss on any related transfer of assets to the franchisees) was $15.2 million compared to $14.8 million in the 39 Weeks ended November 2, 2013. | |||||||||||||
13 Weeks Ended November 1, 2014 | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Net sales | |||||||||||||
Appliances | $ | 261,645 | $ | 139,519 | $ | 401,164 | |||||||
Lawn and garden | 59,447 | 7,065 | 66,512 | ||||||||||
Tools and paint | 41,736 | 4,649 | 46,385 | ||||||||||
Other | 24,915 | 26,171 | 51,086 | ||||||||||
Total | 387,743 | 177,404 | 565,147 | ||||||||||
Costs and expenses | |||||||||||||
Cost of sales and occupancy | 299,013 | 131,072 | 430,085 | ||||||||||
Selling and administrative | 103,395 | 36,371 | 139,766 | ||||||||||
Impairment of goodwill | 167,000 | — | 167,000 | ||||||||||
Depreciation | 746 | 1,289 | 2,035 | ||||||||||
Gain on the sale of assets | (155 | ) | — | (155 | ) | ||||||||
Total | 569,999 | 168,732 | 738,731 | ||||||||||
Operating income (loss) | $ | (182,256 | ) | $ | 8,672 | $ | (173,584 | ) | |||||
Total assets | $ | 455,112 | $ | 208,124 | $ | 663,236 | |||||||
Capital expenditures | $ | 579 | $ | 2,410 | $ | 2,989 | |||||||
13 Weeks Ended November 2, 2013 | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Net sales | |||||||||||||
Appliances | $ | 289,834 | $ | 115,386 | $ | 405,220 | |||||||
Lawn and garden | 59,049 | 5,843 | 64,892 | ||||||||||
Tools and paint | 44,516 | 3,458 | 47,974 | ||||||||||
Other | 19,772 | 23,210 | 42,982 | ||||||||||
Total | 413,171 | 147,897 | 561,068 | ||||||||||
Costs and expenses | |||||||||||||
Cost of sales and occupancy | 318,362 | 107,234 | 425,596 | ||||||||||
Selling and administrative | 94,818 | 26,880 | 121,698 | ||||||||||
Depreciation | 760 | 1,417 | 2,177 | ||||||||||
Gain on the sale of assets | — | (1,567 | ) | (1,567 | ) | ||||||||
Total | 413,940 | 133,964 | 547,904 | ||||||||||
Operating income (loss) | $ | (769 | ) | $ | 13,933 | $ | 13,164 | ||||||
Total assets | $ | 657,019 | $ | 190,989 | $ | 848,008 | |||||||
Capital expenditures | $ | 1,341 | $ | 2,259 | $ | 3,600 | |||||||
39 Weeks Ended November 1, 2014 | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Net sales | |||||||||||||
Appliances | $ | 795,919 | $ | 398,299 | $ | 1,194,218 | |||||||
Lawn and garden | 278,305 | 19,546 | 297,851 | ||||||||||
Tools and paint | 132,470 | 13,566 | 146,036 | ||||||||||
Other | 79,838 | 75,751 | 155,589 | ||||||||||
Total | 1,286,532 | 507,162 | 1,793,694 | ||||||||||
Costs and expenses | |||||||||||||
Cost of sales and occupancy | 983,214 | 384,430 | 1,367,644 | ||||||||||
Selling and administrative | 307,747 | 106,524 | 414,271 | ||||||||||
Impairment of goodwill | 167,000 | — | 167,000 | ||||||||||
Depreciation | 2,127 | 4,263 | 6,390 | ||||||||||
Gain on the sale of assets | (155 | ) | — | (155 | ) | ||||||||
Total | 1,459,933 | 495,217 | 1,955,150 | ||||||||||
Operating income (loss) | $ | (173,401 | ) | $ | 11,945 | $ | (161,456 | ) | |||||
Total assets | $ | 455,112 | $ | 208,124 | $ | 663,236 | |||||||
Capital expenditures | $ | 2,509 | $ | 7,530 | $ | 10,039 | |||||||
39 Weeks Ended November 2, 2013 | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Net sales | |||||||||||||
Appliances | $ | 868,489 | $ | 362,600 | $ | 1,231,089 | |||||||
Lawn and garden | 280,029 | 20,938 | 300,967 | ||||||||||
Tools and paint | 138,996 | 10,063 | 149,059 | ||||||||||
Other | 74,394 | 63,575 | 137,969 | ||||||||||
Total | 1,361,908 | 457,176 | 1,819,084 | ||||||||||
Costs and expenses | |||||||||||||
Cost of sales and occupancy | 1,040,750 | 340,216 | 1,380,966 | ||||||||||
Selling and administrative | 299,175 | 80,640 | 379,815 | ||||||||||
Depreciation | 2,372 | 4,197 | 6,569 | ||||||||||
Gain on the sale of assets | — | (1,567 | ) | (1,567 | ) | ||||||||
Total | 1,342,297 | 423,486 | 1,765,783 | ||||||||||
Operating income | $ | 19,611 | $ | 33,690 | $ | 53,301 | |||||||
Total assets | $ | 657,019 | $ | 190,989 | $ | 848,008 | |||||||
Capital expenditures | $ | 2,711 | $ | 3,284 | $ | 5,995 | |||||||
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Nov. 01, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
COMMITMENTS AND CONTINGENCIES | ' |
COMMITMENTS AND CONTINGENCIES | |
We are subject to various legal and governmental proceedings arising out of the ordinary course of business, the outcome of which, individually or in the aggregate, in the opinion of management, would not have a material adverse effect on our business, financial position, results of operations, or cash flows. |
Income_Per_Common_Share
Income Per Common Share | 9 Months Ended | |||||||||||||||
Nov. 01, 2014 | ||||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||||
INCOME PER COMMON SHARE | ' | |||||||||||||||
INCOME PER COMMON SHARE | ||||||||||||||||
Basic income per common share is calculated by dividing net income by the weighted average number of common shares outstanding for each period. Diluted income per common share also includes the dilutive effect of potential common shares. | ||||||||||||||||
The following table sets forth the components used to calculate basic and diluted income per common share attributable to our stockholders. | ||||||||||||||||
13 Weeks Ended | 13 Weeks Ended | 39 Weeks Ended | 39 Weeks Ended | |||||||||||||
November 1, 2014 | November 2, 2013 | November 1, 2014 | November 2, 2013 | |||||||||||||
Thousands except income per common share | ||||||||||||||||
Basic weighted average shares | 22,666 | 22,999 | 22,666 | 23,066 | ||||||||||||
Dilutive effect of restricted stock | — | — | — | 4 | ||||||||||||
Diluted weighted average shares | 22,666 | 22,999 | 22,666 | 23,070 | ||||||||||||
Net income (loss) | $ | (171,210 | ) | $ | 7,695 | $ | (164,171 | ) | $ | 31,826 | ||||||
Income (loss) per common share: | ||||||||||||||||
Basic | $ | (7.55 | ) | $ | 0.33 | $ | (7.24 | ) | $ | 1.38 | ||||||
Diluted | $ | (7.55 | ) | $ | 0.33 | $ | (7.24 | ) | $ | 1.38 | ||||||
Equity
Equity | 9 Months Ended | |||||||
Nov. 01, 2014 | ||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||
EQUITY | ' | |||||||
EQUITY | ||||||||
Stock-based Compensation | ||||||||
Four million shares of the Company's common stock are reserved for issuance under the Company's Amended and Restated 2012 Stock Plan. A total of 89,221 shares of restricted stock were granted under the plan in the second quarter of 2013 to a group of eligible individuals (as defined in the plan), all of whom were employees of the Company at the time of the grant. As of November 1, 2014, 18,974 shares of the original grant of 89,221 shares of restricted stock had been forfeited. We are authorized to grant stock options and to make other awards to eligible plan participants pursuant to the Amended and Restated 2012 Stock Plan. Except for the 89,221 shares of restricted stock, the Company has made no stock-option or other grants or awards under the plan. | ||||||||
We account for stock-based compensation using the fair value method in accordance with accounting standards regarding share-based payment transactions. During the first three quarters of 2014 we recorded $0.6 million in total compensation expense for the remaining 70,247 shares of restricted stock (none of which had vested as of November 1, 2014). At November 1, 2014, we had $1.6 million in total unrecognized compensation cost related to the 70,247 shares of non-vested restricted stock, which cost we expect to recognize over approximately the next 1.5 years. | ||||||||
The 70,247 shares of restricted stock will vest, if at all, on May 16, 2016 in accordance with and subject to the terms and conditions of restricted-stock agreements, including forfeiture conditions, and the Amended and Restated 2012 Stock Plan. The fair value of these awards is equal to the market price of our common stock on the date of grant. We do not currently have a broad-based program that provides for restricted-stock awards on an annual basis. Changes in restricted-stock awards for 2014 were as follows: | ||||||||
39 Weeks Ended November 1, 2014 | ||||||||
(Shares in Thousands) | Shares | Weighted-Average Fair Value on Date of Grant | ||||||
Beginning of year balance | 87 | 44.45 | ||||||
Granted | — | $ | — | |||||
Vested | — | — | ||||||
Forfeited | (17 | ) | 44.45 | |||||
Balance at 11/1/2014 | 70 | $ | 44.45 | |||||
Share Repurchase Program | ||||||||
On August 28, 2013 the Company's Board of Directors authorized a $25 million repurchase program for the Company's outstanding shares of common stock. The timing and amount of repurchases depend on various factors, including market conditions, the Company's capital position and internal cash generation, and other factors. The Company's repurchase program does not include specific price targets, may be executed through open-market, privately negotiated, and other transactions that may be available, and may include utilization of Rule 10b5-1 plans. The repurchase program does not obligate the Company to repurchase any dollar amount, or any number of shares, of common stock. The repurchase program does not have a termination date, and the Company may suspend or terminate the repurchase program at any time. | ||||||||
Shares that are repurchased by the Company pursuant to the repurchase program will be retired and resume the status of authorized and unissued shares of common stock. | ||||||||
No shares were repurchased during the 39 Weeks ended November 1, 2014. At November 1, 2014 we had approximately $12.5 million of remaining authorization under the repurchase program. |
Background_and_Basis_of_Presen1
Background and Basis of Presentation (Policies) | 9 Months Ended |
Nov. 01, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
Variable Interest Entities and Consolidation | ' |
Variable Interest Entities and Consolidation | |
The Financial Accounting Standards Board ("FASB") has issued guidance on variable interest entities and consolidation for determining whether an entity is a variable interest entity as well as the methods permitted for determining the primary beneficiary of a variable interest entity. In addition, this guidance requires ongoing reassessments of whether a company is the primary beneficiary of a variable interest entity and disclosures related to a company’s involvement with a variable interest entity. | |
On an ongoing basis the Company evaluates its business relationships, such as those with its dealers, franchisees, and suppliers, to identify potential variable interest entities. Generally, these businesses qualify for a scope exception under the consolidation guidance, or, where a variable interest exists, the Company does not possess the power to direct the activities that most significantly impact the economic performance of these businesses. The Company has not consolidated any of such entities in the periods presented. | |
Fair Value of Financial Instruments | ' |
Fair Value of Financial Instruments | |
We determine the fair value of financial instruments in accordance with standards pertaining to fair value measurements. Such standards define fair value and establish a framework for measuring fair value under GAAP. Under fair value measurement accounting standards, fair value is considered to be the exchange price in an orderly transaction between market participants to sell an asset or transfer a liability at the measurement date. We report the fair value of financial assets and liabilities based on the fair value hierarchy prescribed by accounting standards for fair value measurements, which prioritizes the inputs to valuation techniques used to measure fair value into three levels, as follows: | |
Level 1 inputs—unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access. An active market for the asset or liability is one in which transactions for the asset or liability occurs with sufficient frequency and volume to provide ongoing pricing information. | |
Level 2 inputs—inputs other than quoted market prices included in Level 1 that are observable, either directly or indirectly, for the asset or liability. Level 2 inputs include, but are not limited to, quoted prices for similar assets or liabilities in an active market, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs other than quoted market prices that are observable for the asset or liability, such as interest-rate curves and yield curves observable at commonly quoted intervals, volatilities, credit risks, and default rates. | |
Level 3 inputs—unobservable inputs for the asset or liability. | |
Cash and cash equivalents (level 1), accounts and notes receivable, short-term debt (level 2), merchandise payables, and accrued expenses are reflected in the Condensed Consolidated Balance Sheets at cost, which approximates fair value due to the short-term nature of these instruments. For short-term debt, the variable interest rates are a significant input in our fair value assessments. The carrying value of long-term notes receivable approximates fair value. | |
We measure certain non-financial assets and liabilities, including long-lived assets, at fair value on a non-recurring basis. | |
Recent Accounting Pronouncements | ' |
Recent Accounting Pronouncements | |
Revenue from Contracts with Customers | |
In May 2014, the FASB issued an accounting standards update which establishes a comprehensive revenue recognition standard in U.S. GAAP for virtually all industries, including those that previously followed industry-specific guidance such as the real estate, construction, and software industries. The update is effective in fiscal 2017, and we are currently evaluating the potential impact. Accordingly, we cannot estimate the effect on our consolidated financial position, results of operations, or cash flows. |
Accounts_and_Notes_Receivable_1
Accounts and Notes Receivable and Other Assets (Tables) | 9 Months Ended | ||||||||||||
Nov. 01, 2014 | |||||||||||||
Receivables [Abstract] | ' | ||||||||||||
Schedule of Accounts and Notes Receivable and Other Assets | ' | ||||||||||||
Accounts and franchisee receivables and other assets consist of the following: | |||||||||||||
November 1, | |||||||||||||
2014 | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Short-term franchisee receivables | $ | 8,129 | $ | 4,463 | $ | 12,592 | |||||||
Miscellaneous receivables | 7,609 | 2,112 | 9,721 | ||||||||||
Long-term franchisee receivables | 21,246 | 27,688 | 48,934 | ||||||||||
Other assets | 2,112 | 282 | 2,394 | ||||||||||
Provision for losses on short-term franchisee receivables (1) | (1,383 | ) | — | (1,383 | ) | ||||||||
Provision for losses on long-term franchisee receivables (1) | (10,143 | ) | — | (10,143 | ) | ||||||||
Total Accounts and franchisee receivables and other assets | $ | 27,570 | $ | 34,545 | $ | 62,115 | |||||||
November 2, | |||||||||||||
2013 | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Short-term franchisee receivables | $ | 2,676 | $ | 896 | $ | 3,572 | |||||||
Miscellaneous receivables | 13,198 | 437 | 13,635 | ||||||||||
Long-term franchisee receivables | 21,090 | 7,974 | 29,064 | ||||||||||
Other assets | 2,844 | 207 | 3,051 | ||||||||||
Total Accounts and franchisee receivables and other assets | $ | 39,808 | $ | 9,514 | $ | 49,322 | |||||||
February 1, | |||||||||||||
2014 | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Short-term franchisee receivables | $ | 2,748 | $ | 1,844 | $ | 4,592 | |||||||
Miscellaneous receivables | 13,029 | 1,631 | 14,660 | ||||||||||
Long-term franchisee receivables | 21,207 | 16,409 | 37,616 | ||||||||||
Other assets | 2,662 | 212 | 2,874 | ||||||||||
Total Accounts and franchisee receivables and other assets | $ | 39,646 | $ | 20,096 | $ | 59,742 | |||||||
(1) The Company recognizes a provision for losses on franchisee receivables (which consist primarily of franchisee promissory notes) in an amount equal to estimated probable losses net of recoveries. The provision is based on an analysis of expected future write-offs, existing economic conditions, and an assessment of specific identifiable franchisee promissory notes and other franchisee receivables considered at risk or uncollectible. The expense associated with the provision for losses on franchisee receivables is recognized as selling, general, and administrative expense. Most of our franchisee promissory notes authorize us to deduct debt service from our commissions otherwise due and payable to the franchisees, and we routinely make those deductions to the extent of available commissions payable. We established the provision for losses on franchisee receivables in the third quarter of fiscal 2014 based on our receivable-by-receivable assessment during the quarter that some of the Hometown franchisee receivables were potentially uncollectible in future periods due to (a) declining results of operations of, or other adverse financial events with respect to, Hometown franchise stores that indicated that the franchisees might not be able to meet their debt-service and other obligations to us as they became due and (b) the refusal during the quarter of one of our Hometown franchisees to continue to operate its franchise stores in accordance with the franchisee's agreements with us |
Other_Current_and_LongTerm_Lia1
Other Current and Long-Term Liabilities (Tables) | 9 Months Ended | ||||||||||||
Nov. 01, 2014 | |||||||||||||
Payables and Accruals [Abstract] | ' | ||||||||||||
Schedule of Accrued Expenses and Other Long-term Liabilities | ' | ||||||||||||
Other current and long-term liabilities consist of the following: | |||||||||||||
Thousands | November 1, | November 2, | February 1, | ||||||||||
2014 | 2013 | 2014 | |||||||||||
Customer deposits | $ | 32,322 | $ | 40,913 | $ | 35,547 | |||||||
Sales and other taxes | 14,052 | 14,072 | 11,403 | ||||||||||
Accrued expenses | 10,617 | 13,267 | 9,523 | ||||||||||
Payroll and related items | 5,996 | 11,193 | 8,105 | ||||||||||
Total Other current and long-term liabilities | $ | 62,987 | $ | 79,445 | $ | 64,578 | |||||||
Goodwill_Tables
Goodwill (Tables) | 9 Months Ended | ||||||||||||
Nov. 01, 2014 | |||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | ||||||||||||
Schedule of Goodwill | ' | ||||||||||||
Goodwill allocated to our Hometown and Outlet segments as of November 1, 2014, and changes in the carrying amount of goodwill for the nine months ended November 1, 2014, are as follows: | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Balance (gross) at February 1, 2014 | $ | 167,000 | $ | — | $ | 167,000 | |||||||
Impairment Loss | (167,000 | ) | — | (167,000 | ) | ||||||||
Balance at November 1, 2014 | $ | — | $ | — | $ | — | |||||||
Related_Party_Agreements_and_T1
Related Party Agreements and Transactions (Tables) | 9 Months Ended | ||||||||||||||||
Nov. 01, 2014 | |||||||||||||||||
Related Party Transactions [Abstract] | ' | ||||||||||||||||
Schedule of Related Party Transactions | ' | ||||||||||||||||
The following table summarizes the results of the transactions with Sears Holdings reflected in the Company’s Condensed Consolidated Financial Statements: | |||||||||||||||||
13 Weeks Ended | 39 Weeks Ended | ||||||||||||||||
November 1, | November 2, | November 1, | November 2, | ||||||||||||||
Thousands | 2014 | 2013 | 2014 | 2013 | |||||||||||||
Net Commissions from Sears Holdings | $ | 22,069 | $ | 21,424 | $ | 76,808 | $ | 68,327 | |||||||||
Purchases related to cost of sales and occupancy (1) | 351,935 | 395,178 | 1,156,632 | 1,224,254 | |||||||||||||
Services (1) | 23,302 | 29,410 | 73,089 | 85,655 | |||||||||||||
(1) Amounts previously presented for the 13 and 39 Weeks ended November 2, 2013 and for the 13 weeks ended May 3, 2014 within "Purchases related to cost of sales and occupancy" have been reclassified into "Services." The reclassified items were primarily costs associated with marketing. The reclassified amount for the 13 weeks ended November 2, 2013 was $23.8 million. The reclassified amounts for the 39 Weeks ended November 2, 2013 and November 1, 2014 were $69.6 million and $20.3 million, respectively. |
Summary_of_Segment_Data_Tables
Summary of Segment Data (Tables) | 9 Months Ended | ||||||||||||
Nov. 01, 2014 | |||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||
Schedule of Segment Data | ' | ||||||||||||
13 Weeks Ended November 1, 2014 | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Net sales | |||||||||||||
Appliances | $ | 261,645 | $ | 139,519 | $ | 401,164 | |||||||
Lawn and garden | 59,447 | 7,065 | 66,512 | ||||||||||
Tools and paint | 41,736 | 4,649 | 46,385 | ||||||||||
Other | 24,915 | 26,171 | 51,086 | ||||||||||
Total | 387,743 | 177,404 | 565,147 | ||||||||||
Costs and expenses | |||||||||||||
Cost of sales and occupancy | 299,013 | 131,072 | 430,085 | ||||||||||
Selling and administrative | 103,395 | 36,371 | 139,766 | ||||||||||
Impairment of goodwill | 167,000 | — | 167,000 | ||||||||||
Depreciation | 746 | 1,289 | 2,035 | ||||||||||
Gain on the sale of assets | (155 | ) | — | (155 | ) | ||||||||
Total | 569,999 | 168,732 | 738,731 | ||||||||||
Operating income (loss) | $ | (182,256 | ) | $ | 8,672 | $ | (173,584 | ) | |||||
Total assets | $ | 455,112 | $ | 208,124 | $ | 663,236 | |||||||
Capital expenditures | $ | 579 | $ | 2,410 | $ | 2,989 | |||||||
13 Weeks Ended November 2, 2013 | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Net sales | |||||||||||||
Appliances | $ | 289,834 | $ | 115,386 | $ | 405,220 | |||||||
Lawn and garden | 59,049 | 5,843 | 64,892 | ||||||||||
Tools and paint | 44,516 | 3,458 | 47,974 | ||||||||||
Other | 19,772 | 23,210 | 42,982 | ||||||||||
Total | 413,171 | 147,897 | 561,068 | ||||||||||
Costs and expenses | |||||||||||||
Cost of sales and occupancy | 318,362 | 107,234 | 425,596 | ||||||||||
Selling and administrative | 94,818 | 26,880 | 121,698 | ||||||||||
Depreciation | 760 | 1,417 | 2,177 | ||||||||||
Gain on the sale of assets | — | (1,567 | ) | (1,567 | ) | ||||||||
Total | 413,940 | 133,964 | 547,904 | ||||||||||
Operating income (loss) | $ | (769 | ) | $ | 13,933 | $ | 13,164 | ||||||
Total assets | $ | 657,019 | $ | 190,989 | $ | 848,008 | |||||||
Capital expenditures | $ | 1,341 | $ | 2,259 | $ | 3,600 | |||||||
39 Weeks Ended November 1, 2014 | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Net sales | |||||||||||||
Appliances | $ | 795,919 | $ | 398,299 | $ | 1,194,218 | |||||||
Lawn and garden | 278,305 | 19,546 | 297,851 | ||||||||||
Tools and paint | 132,470 | 13,566 | 146,036 | ||||||||||
Other | 79,838 | 75,751 | 155,589 | ||||||||||
Total | 1,286,532 | 507,162 | 1,793,694 | ||||||||||
Costs and expenses | |||||||||||||
Cost of sales and occupancy | 983,214 | 384,430 | 1,367,644 | ||||||||||
Selling and administrative | 307,747 | 106,524 | 414,271 | ||||||||||
Impairment of goodwill | 167,000 | — | 167,000 | ||||||||||
Depreciation | 2,127 | 4,263 | 6,390 | ||||||||||
Gain on the sale of assets | (155 | ) | — | (155 | ) | ||||||||
Total | 1,459,933 | 495,217 | 1,955,150 | ||||||||||
Operating income (loss) | $ | (173,401 | ) | $ | 11,945 | $ | (161,456 | ) | |||||
Total assets | $ | 455,112 | $ | 208,124 | $ | 663,236 | |||||||
Capital expenditures | $ | 2,509 | $ | 7,530 | $ | 10,039 | |||||||
39 Weeks Ended November 2, 2013 | |||||||||||||
Thousands | Hometown | Outlet | Total | ||||||||||
Net sales | |||||||||||||
Appliances | $ | 868,489 | $ | 362,600 | $ | 1,231,089 | |||||||
Lawn and garden | 280,029 | 20,938 | 300,967 | ||||||||||
Tools and paint | 138,996 | 10,063 | 149,059 | ||||||||||
Other | 74,394 | 63,575 | 137,969 | ||||||||||
Total | 1,361,908 | 457,176 | 1,819,084 | ||||||||||
Costs and expenses | |||||||||||||
Cost of sales and occupancy | 1,040,750 | 340,216 | 1,380,966 | ||||||||||
Selling and administrative | 299,175 | 80,640 | 379,815 | ||||||||||
Depreciation | 2,372 | 4,197 | 6,569 | ||||||||||
Gain on the sale of assets | — | (1,567 | ) | (1,567 | ) | ||||||||
Total | 1,342,297 | 423,486 | 1,765,783 | ||||||||||
Operating income | $ | 19,611 | $ | 33,690 | $ | 53,301 | |||||||
Total assets | $ | 657,019 | $ | 190,989 | $ | 848,008 | |||||||
Capital expenditures | $ | 2,711 | $ | 3,284 | $ | 5,995 | |||||||
Income_Per_Common_Share_Tables
Income Per Common Share (Tables) | 9 Months Ended | |||||||||||||||
Nov. 01, 2014 | ||||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | ' | |||||||||||||||
The following table sets forth the components used to calculate basic and diluted income per common share attributable to our stockholders. | ||||||||||||||||
13 Weeks Ended | 13 Weeks Ended | 39 Weeks Ended | 39 Weeks Ended | |||||||||||||
November 1, 2014 | November 2, 2013 | November 1, 2014 | November 2, 2013 | |||||||||||||
Thousands except income per common share | ||||||||||||||||
Basic weighted average shares | 22,666 | 22,999 | 22,666 | 23,066 | ||||||||||||
Dilutive effect of restricted stock | — | — | — | 4 | ||||||||||||
Diluted weighted average shares | 22,666 | 22,999 | 22,666 | 23,070 | ||||||||||||
Net income (loss) | $ | (171,210 | ) | $ | 7,695 | $ | (164,171 | ) | $ | 31,826 | ||||||
Income (loss) per common share: | ||||||||||||||||
Basic | $ | (7.55 | ) | $ | 0.33 | $ | (7.24 | ) | $ | 1.38 | ||||||
Diluted | $ | (7.55 | ) | $ | 0.33 | $ | (7.24 | ) | $ | 1.38 | ||||||
Equity_Tables
Equity (Tables) | 9 Months Ended | |||||||
Nov. 01, 2014 | ||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||
Schedule of Restricted Stock Award Activity | ' | |||||||
We do not currently have a broad-based program that provides for restricted-stock awards on an annual basis. Changes in restricted-stock awards for 2014 were as follows: | ||||||||
39 Weeks Ended November 1, 2014 | ||||||||
(Shares in Thousands) | Shares | Weighted-Average Fair Value on Date of Grant | ||||||
Beginning of year balance | 87 | 44.45 | ||||||
Granted | — | $ | — | |||||
Vested | — | — | ||||||
Forfeited | (17 | ) | 44.45 | |||||
Balance at 11/1/2014 | 70 | $ | 44.45 | |||||
Background_and_Basis_of_Presen2
Background and Basis of Presentation (Details) | 9 Months Ended |
Nov. 01, 2014 | |
segment | |
store | |
state | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
Number of stores | 1,257 |
Number of states in which the Company operates | 50 |
Number of operating segments | 2 |
Accounts_and_Notes_Receivable_2
Accounts and Notes Receivable and Other Assets (Details) (USD $) | Nov. 01, 2014 | Feb. 01, 2014 | Nov. 02, 2013 | |
In Thousands, unless otherwise specified | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' | ' | |
Short-term franchisee receivables | $12,592 | $4,592 | $3,572 | |
Miscellaneous receivables | 9,721 | 14,660 | 13,635 | |
Long-term franchisee notes receivables | 48,934 | 37,616 | 29,064 | |
Other assets | 2,394 | 2,874 | 3,051 | |
Provision for losses on short-term franchisee receivables (1) | -1,383 | [1] | ' | ' |
Provision for losses on franchisee receivables (1) | -10,143 | [1] | ' | ' |
Total Accounts and notes receivable and other assets | 62,115 | 59,742 | 49,322 | |
Sears Hometown and Hardware [Member] | ' | ' | ' | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' | ' | |
Short-term franchisee receivables | 8,129 | 2,748 | 2,676 | |
Miscellaneous receivables | 7,609 | 13,029 | 13,198 | |
Long-term franchisee notes receivables | 21,246 | 21,207 | 21,090 | |
Other assets | 2,112 | 2,662 | 2,844 | |
Provision for losses on short-term franchisee receivables (1) | -1,383 | [1] | ' | ' |
Provision for losses on franchisee receivables (1) | -10,143 | [1] | ' | ' |
Total Accounts and notes receivable and other assets | 27,570 | 39,646 | 39,808 | |
Sears Outlet [Member] | ' | ' | ' | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' | ' | |
Short-term franchisee receivables | 4,463 | 1,844 | 896 | |
Miscellaneous receivables | 2,112 | 1,631 | 437 | |
Long-term franchisee notes receivables | 27,688 | 16,409 | 7,974 | |
Other assets | 282 | 212 | 207 | |
Provision for losses on short-term franchisee receivables (1) | 0 | [1] | ' | ' |
Provision for losses on franchisee receivables (1) | 0 | [1] | ' | ' |
Total Accounts and notes receivable and other assets | $34,545 | $20,096 | $9,514 | |
[1] | The Company recognizes a provision for losses on franchisee receivables (which consist primarily of franchisee promissory notes) in an amount equal to estimated probable losses net of recoveries. The provision is based on an analysis of expected future write-offs, existing economic conditions, and an assessment of specific identifiable franchisee promissory notes and other franchisee receivables considered at risk or uncollectible. The expense associated with the provision for losses on franchisee receivables is recognized as selling, general, and administrative expense. Most of our franchisee promissory notes authorize us to deduct debt service from our commissions otherwise due and payable to the franchisees, and we routinely make those deductions to the extent of available commissions payable. We established the provision for losses on franchisee receivables in the third quarter of fiscal 2014 based on our receivable-by-receivable assessment during the quarter that some of the Hometown franchisee receivables were potentially uncollectible in future periods due to (a) declining results of operations of, or other adverse financial events with respect to, Hometown franchise stores that indicated that the franchisees might not be able to meet their debt-service and other obligations to us as they became due and (b) the refusal during the quarter of one of our Hometown franchisees to continue to operate its franchise stores in accordance with the franchisee's agreements with us |
Other_Current_and_LongTerm_Lia2
Other Current and Long-Term Liabilities (Details) (USD $) | Nov. 01, 2014 | Feb. 01, 2014 | Nov. 02, 2013 |
In Thousands, unless otherwise specified | |||
Payables and Accruals [Abstract] | ' | ' | ' |
Customer deposits | $32,322 | $35,547 | $40,913 |
Sales and other taxes | 14,052 | 11,403 | 14,072 |
Accrued expenses | 10,617 | 9,523 | 13,267 |
Payroll and related items | 5,996 | 8,105 | 11,193 |
Total Other current and long-term liabilities | $62,987 | $64,578 | $79,445 |
Goodwill_Details
Goodwill (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Nov. 01, 2014 | Nov. 02, 2013 | Nov. 01, 2014 | Nov. 02, 2013 |
Goodwill [Line Items] | ' | ' | ' | ' |
Balance (gross) at February 1, 2014 | ' | ' | $167,000 | ' |
Impairment Loss | -167,000 | 0 | -167,000 | 0 |
Balance at November 1, 2014 | 0 | ' | 0 | ' |
Sears Hometown and Hardware [Member] | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' |
Balance (gross) at February 1, 2014 | ' | ' | 167,000 | ' |
Impairment Loss | -167,000 | ' | -167,000 | ' |
Balance at November 1, 2014 | 0 | ' | 0 | ' |
Sears Outlet [Member] | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' |
Balance (gross) at February 1, 2014 | ' | ' | 0 | ' |
Impairment Loss | 0 | ' | 0 | ' |
Balance at November 1, 2014 | $0 | ' | $0 | ' |
Income_Taxes_Details
Income Taxes (Details) (USD $) | Nov. 01, 2014 | Feb. 01, 2014 | Nov. 02, 2013 |
In Millions, unless otherwise specified | |||
Income Tax Disclosure [Abstract] | ' | ' | ' |
Deferred tax assets | $57.20 | $58 | $61.10 |
Related_Party_Agreements_and_T2
Related Party Agreements and Transactions (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||||
Nov. 01, 2014 | Nov. 02, 2013 | Nov. 01, 2014 | Nov. 02, 2013 | |||||
Related Party Transaction [Line Items] | ' | ' | ' | ' | ||||
Exclusion of on-line sales | ' | $23,800,000 | $20,300,000 | $69,600,000 | ||||
ESL [Member] | ' | ' | ' | ' | ||||
Related Party Transaction [Line Items] | ' | ' | ' | ' | ||||
Beneficial interest acquired by related party, percentage | 47.00% | ' | 47.00% | ' | ||||
Sears Holdings Corporation [Member] | ' | ' | ' | ' | ||||
Related Party Transaction [Line Items] | ' | ' | ' | ' | ||||
Net Commissions from Sears Holdings | 22,069,000 | 21,424,000 | 76,808,000 | 68,327,000 | ||||
Purchases related to cost of sales and occupancy (1) | 351,935,000 | [1] | 395,178,000 | [1] | 1,156,632,000 | [1] | 1,224,254,000 | [1] |
Services (1) | $23,302,000 | [1] | $29,410,000 | [1] | $73,089,000 | [1] | $85,655,000 | [1] |
Invoice payment term | '10 days | ' | ' | ' | ||||
Sears Holdings [Member] | ESL [Member] | ' | ' | ' | ' | ||||
Related Party Transaction [Line Items] | ' | ' | ' | ' | ||||
Beneficial interest acquired by related party, percentage | 56.00% | ' | 56.00% | ' | ||||
[1] | Amounts previously presented for the 13 and 39 Weeks ended November 2, 2013 and for the 13 weeks ended May 3, 2014 within "Purchases related to cost of sales and occupancy" have been reclassified into "Services." The reclassified items were primarily costs associated with marketing. The reclassified amount for the 13 weeks ended November 2, 2013 was $23.8 million. The reclassified amounts for the 39 Weeks ended November 2, 2013 and November 1, 2014 were $69.6 million and $20.3 million, respectively. |
Financing_Arrangements_Details
Financing Arrangements (Details) (Senior ABL Facility [Member], USD $) | 9 Months Ended |
Nov. 01, 2014 | |
Debt Instrument [Line Items] | ' |
Remaining borrowing capacity | $73,200,000 |
Covenant, maximum percentage of Loan Cap | 25.00% |
Covenant, component of aggregate commitment calculation | 50,000,000 |
Covenant, fixed charge coverage ratio | 1.1 |
Covenant, period of credit extensions outstanding | '120 days |
LIBOR [Member] | ' |
Debt Instrument [Line Items] | ' |
Basis spread on variable rate | 2.41% |
Base Rate [Member] | ' |
Debt Instrument [Line Items] | ' |
Basis spread on variable rate | 4.50% |
Revolving Credit Facility [Member] | ' |
Debt Instrument [Line Items] | ' |
Aggregate maximum borrowings | 250,000,000 |
Increases in aggregate principal | 100,000,000 |
Letter of Credit [Member] | ' |
Debt Instrument [Line Items] | ' |
Remaining borrowing capacity | 171,200,000 |
Aggregate maximum borrowings | 75,000,000 |
Amount outstanding | 5,600,000 |
Swingline Loans [Member] | ' |
Debt Instrument [Line Items] | ' |
Aggregate maximum borrowings | $25,000,000 |
Summary_of_Segment_Data_Detail
Summary of Segment Data (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Nov. 01, 2014 | Nov. 02, 2013 | Nov. 01, 2014 | Nov. 02, 2013 | Feb. 01, 2014 | |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Initial franchise revenue | $6,500,000 | $7,800,000 | $15,200,000 | $14,800,000 | ' |
Net sales | 565,147,000 | 561,068,000 | 1,793,694,000 | 1,819,084,000 | ' |
Cost of sales and occupancy | 430,085,000 | 425,596,000 | 1,367,644,000 | 1,380,966,000 | ' |
Selling and administrative | 139,766,000 | 121,698,000 | 414,271,000 | 379,815,000 | ' |
Impairment of goodwill | 167,000,000 | 0 | 167,000,000 | 0 | ' |
Depreciation | 2,035,000 | 2,177,000 | 6,390,000 | 6,569,000 | ' |
Gain on the sale of assets | -155,000 | -1,567,000 | -155,000 | -1,567,000 | ' |
Total costs and expenses | 738,731,000 | 547,904,000 | 1,955,150,000 | 1,765,783,000 | ' |
Operating income (loss) | -173,584,000 | 13,164,000 | -161,456,000 | 53,301,000 | ' |
Total assets | 663,236,000 | 848,008,000 | 663,236,000 | 848,008,000 | 847,185,000 |
Capital expenditures | 2,989,000 | 3,600,000 | 10,039,000 | 5,995,000 | ' |
Appliances [Member] | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Net sales | 401,164,000 | 405,220,000 | 1,194,218,000 | 1,231,089,000 | ' |
Lawn and Garden [Member] | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Net sales | 66,512,000 | 64,892,000 | 297,851,000 | 300,967,000 | ' |
Tools and Paint [Member] | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Net sales | 46,385,000 | 47,974,000 | 146,036,000 | 149,059,000 | ' |
Other [Member] | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Net sales | 51,086,000 | 42,982,000 | 155,589,000 | 137,969,000 | ' |
Sears Hometown and Hardware [Member] | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Net sales | 387,743,000 | 413,171,000 | 1,286,532,000 | 1,361,908,000 | ' |
Cost of sales and occupancy | 299,013,000 | 318,362,000 | 983,214,000 | 1,040,750,000 | ' |
Selling and administrative | 103,395,000 | 94,818,000 | 307,747,000 | 299,175,000 | ' |
Impairment of goodwill | 167,000,000 | ' | 167,000,000 | ' | ' |
Depreciation | 746,000 | 760,000 | 2,127,000 | 2,372,000 | ' |
Gain on the sale of assets | -155,000 | 0 | -155,000 | 0 | ' |
Total costs and expenses | 569,999,000 | 413,940,000 | 1,459,933,000 | 1,342,297,000 | ' |
Operating income (loss) | -182,256,000 | -769,000 | -173,401,000 | 19,611,000 | ' |
Total assets | 455,112,000 | 657,019,000 | 455,112,000 | 657,019,000 | ' |
Capital expenditures | 579,000 | 1,341,000 | 2,509,000 | 2,711,000 | ' |
Sears Hometown and Hardware [Member] | Appliances [Member] | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Net sales | 261,645,000 | 289,834,000 | 795,919,000 | 868,489,000 | ' |
Sears Hometown and Hardware [Member] | Lawn and Garden [Member] | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Net sales | 59,447,000 | 59,049,000 | 278,305,000 | 280,029,000 | ' |
Sears Hometown and Hardware [Member] | Tools and Paint [Member] | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Net sales | 41,736,000 | 44,516,000 | 132,470,000 | 138,996,000 | ' |
Sears Hometown and Hardware [Member] | Other [Member] | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Net sales | 24,915,000 | 19,772,000 | 79,838,000 | 74,394,000 | ' |
Sears Outlet [Member] | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Net sales | 177,404,000 | 147,897,000 | 507,162,000 | 457,176,000 | ' |
Cost of sales and occupancy | 131,072,000 | 107,234,000 | 384,430,000 | 340,216,000 | ' |
Selling and administrative | 36,371,000 | 26,880,000 | 106,524,000 | 80,640,000 | ' |
Impairment of goodwill | 0 | ' | 0 | ' | ' |
Depreciation | 1,289,000 | 1,417,000 | 4,263,000 | 4,197,000 | ' |
Gain on the sale of assets | 0 | -1,567,000 | 0 | -1,567,000 | ' |
Total costs and expenses | 168,732,000 | 133,964,000 | 495,217,000 | 423,486,000 | ' |
Operating income (loss) | 8,672,000 | 13,933,000 | 11,945,000 | 33,690,000 | ' |
Total assets | 208,124,000 | 190,989,000 | 208,124,000 | 190,989,000 | ' |
Capital expenditures | 2,410,000 | 2,259,000 | 7,530,000 | 3,284,000 | ' |
Sears Outlet [Member] | Appliances [Member] | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Net sales | 139,519,000 | 115,386,000 | 398,299,000 | 362,600,000 | ' |
Sears Outlet [Member] | Lawn and Garden [Member] | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Net sales | 7,065,000 | 5,843,000 | 19,546,000 | 20,938,000 | ' |
Sears Outlet [Member] | Tools and Paint [Member] | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Net sales | 4,649,000 | 3,458,000 | 13,566,000 | 10,063,000 | ' |
Sears Outlet [Member] | Other [Member] | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' |
Net sales | $26,171,000 | $23,210,000 | $75,751,000 | $63,575,000 | ' |
Income_Per_Common_Share_Detail
Income Per Common Share (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Nov. 01, 2014 | Nov. 02, 2013 | Nov. 01, 2014 | Nov. 02, 2013 |
Earnings Per Share [Abstract] | ' | ' | ' | ' |
Basic weighted average shares | 22,666 | 22,999 | 22,666 | 23,066 |
Dilutive effect of restricted stock | 0 | 0 | 0 | 4 |
Diluted weighted average shares | 22,666 | 22,999 | 22,666 | 23,070 |
Net income (loss) | ($171,210) | $7,695 | ($164,171) | $31,826 |
Income (loss) per common share: | ' | ' | ' | ' |
Basic (in dollars per share) | ($7.55) | $0.33 | ($7.24) | $1.38 |
Diluted (in dollars per share) | ($7.55) | $0.33 | ($7.24) | $1.38 |
Equity_Narrative_Details
Equity (Narrative) (Details) (USD $) | 0 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Aug. 29, 2013 | Nov. 01, 2014 | 14-May-13 | Aug. 03, 2013 | Nov. 01, 2014 | Nov. 01, 2014 |
Restricted Stock [Member] | Restricted Stock [Member] | Restricted Stock [Member] | ||||
May 16, 2016 [Member] | ||||||
Stock-based Compensation | ' | ' | ' | ' | ' | ' |
Shares reserved under plan | ' | ' | 4,000,000 | ' | ' | ' |
Stock granted | ' | ' | ' | 89,221 | 70,247 | 70,247 |
Forfeited in period | ' | ' | ' | ' | 18,974 | ' |
Share-based compensation expense | ' | ' | ' | ' | $0.60 | ' |
Total unrecognized compensation | ' | ' | ' | ' | 1.6 | ' |
Period for recognition | ' | ' | ' | ' | '1 year 6 months | ' |
Share Repurchase Program | ' | ' | ' | ' | ' | ' |
Authorized amount | 25 | ' | ' | ' | ' | ' |
Remaining authorized repurchase amount | ' | $12.50 | ' | ' | ' | ' |
Equity_Restricted_Stock_Awards
Equity (Restricted Stock Awards) (Details) (Restricted Stock [Member], USD $) | 9 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Nov. 01, 2014 |
Restricted Stock [Member] | ' |
Shares | ' |
Beginning of year balance | 87 |
Granted | 0 |
Vested | 0 |
Forfeited | -17 |
Balance at end of period | 70 |
Weighted-Average Fair Value on Date of Grant | ' |
Beginning of year balance (in dollars per share) | $44.45 |
Granted (in dollars per share) | $0 |
Vested (in dollars per share) | $0 |
Forfeited (in dollars per share) | $44.45 |
Balance at end of period (in dollars per share) | $44.45 |