Boot Barn Holdings, Inc. Announces Third Quarter Fiscal Year 2024 Financial Results

Boot Barn Holdings, Inc. (NYSE: BOOT) today announced its financial results for the third fiscal quarter ended December 30, 2023. A Supplemental Financial Presentation is available at investor.bootbarn.com.

For the quarter ended December 30, 2023:

• Net sales increased 1.1% over the prior-year period to $520.4 million.
• Same store sales decreased 9.7% compared to the prior-year period, cycling 51% same store sales growth on a 2-year stack basis. The 9.7% decrease in consolidated same store sales is comprised of a decrease in retail store same store sales of 9.4% and a decrease in e-commerce same store sales of 11.5%.
• Net income was $55.6 million, or $1.81 per diluted share, compared to $52.8 million, or $1.74 per diluted share in the prior-year period.
• The Company opened 11 new stores, bringing its total store count to 382.

Jim Conroy, President and Chief Executive Officer, commented “I am pleased with our third quarter performance. We added 11 new stores and were able to maintain our consistent track record of delivering growth. Excluding three quarters in calendar 2020 that were impacted by the pandemic, the third quarter marks our 38th consecutive quarter of year-over-year sales growth since our IPO in 2014, nearly ten years ago. Our top line was driven by the sales from the 49 new stores opened over the past 12 months, which more than offset a 9.7% decline in same store sales. We also grew earnings compared to last year through a combination of sales growth, disciplined expense control and an increase in merchandise margin, which benefited from improved freight. These results underscore the strength of the Boot Barn business model and are a testament to solid execution across the organization.”

Operating Results for the Third Quarter Ended December 30, 2023 Compared to the Third Quarter Ended December 24, 2022

• Net sales increased 1.1% to $520.4 million from $514.6 million in the prior-year period. Consolidated same store sales decreased 9.7% with retail store same store sales decreasing 9.4% and e-commerce same store sales decreasing 11.5%. The increase in net sales was the result of the incremental sales from new stores opened over the past twelve months, partially offset by the decrease in consolidated same store sales.

• Gross profit was $199.1 million, or 38.3% of net sales, compared to $187.8 million, or 36.5% of net sales, in the prior-year period. Gross profit increased primarily due to merchandise margin expansion and sales growth. The increase in gross profit rate of 180 basis points was driven primarily by a 300 basis-point increase in merchandise margin rate partially offset by 120 basis points of deleverage in buying, occupancy and distribution center costs. The increase in merchandise margin rate was driven by a 250 basis-point improvement in freight expense as a percentage of net sales and 50 basis points of product margin expansion resulting primarily from lower promotional activity and growth in exclusive brand penetration. The deleverage in buying, occupancy and distribution center costs was driven primarily by the occupancy costs of 49 new stores and operating costs related to the new Kansas City distribution center.

• Selling, general and administrative expenses were $124.0 million, or 23.8% of net sales, compared to $115.3 million, or 22.4% of net sales, in the prior-year period. The increase in selling, general and administrative expenses as compared to the prior-year period was primarily a result of higher general and administrative expenses, store payroll associated with operating 49 new stores and other operating expenses in the current year. Selling, general and administrative expenses as a percentage of net sales increased by 140 basis points primarily as a result of higher overhead, payroll and other operating expenses.

• Income from operations increased $2.6 million to $75.1 million, or 14.4% of net sales, compared to $72.5 million, or 14.1% of net sales, in the prior-year period, primarily due to the factors noted above.

• Net income was $55.6 million, or $1.81 per diluted share, compared to net income of $52.8 million, or $1.74 per diluted share in the prior-year period. The increase in net income is primarily attributable to the factors noted above.

Operating Results for the Nine Months Ended December 30, 2023 Compared to the Nine Months Ended December 24, 2022

• Net sales increased 3.8% to $1.279 billion from $1.232 billion in the prior-year period. Consolidated same store sales decreased 6.3% with retail store same store sales decreasing 5.6% and e-commerce same store sales decreasing 11.4%. The increase in net sales was the result of the incremental sales from new stores opened over the past twelve months, partially offset by the decrease in consolidated same store sales.

• Gross profit was $475.0 million, or 37.2% of net sales, compared to $454.7 million, or 36.9% of net sales, in the prior-year period. Gross profit increased primarily due to sales growth and merchandise margin expansion. The increase in gross profit rate of 30 basis points was driven primarily by a 170 basis-point increase in merchandise margin rate, partially offset by 140 basis points of deleverage in buying, occupancy and distribution center costs. The increase in merchandise margin rate was driven by a 120 basis-point improvement in freight expense as a percentage of net sales and 50 basis points of product margin expansion resulting primarily from growth in exclusive brand penetration. The deleverage in buying, occupancy and distribution center costs was driven primarily by the occupancy costs of 49 new stores and operating costs related to the new Kansas City distribution center.

• Selling, general and administrative expenses were $315.0 million, or 24.6% of net sales, compared to $285.7 million, or 23.2% of net sales, in the prior-year period. The increase in selling, general and administrative expenses as compared to the prior-year period was primarily a result of higher store payroll and store-related expenses associated with operating 49 new stores and general and administrative expenses in the current year. Selling, general and administrative expenses as a percentage of net sales increased by 140 basis points primarily as a result of higher payroll and overhead costs.

• Income from operations decreased $9.1 million to $160.0 million, or 12.5% of net sales, compared to $169.1 million, or 13.7% of net sales, in the prior-year period, primarily due to the factors noted above.

• Net income was $117.6 million, or $3.84 per diluted share, compared to net income of $124.1 million, or $4.09 per diluted share in the prior-year period. Net income per diluted share in the current-year period includes an approximately $0.01 per share tax benefit, primarily due to income tax accounting for share-based compensation, partially offset by changes to state tax rates. Net income per diluted share in the prior-year period includes an approximately $0.03 per share tax benefit, primarily due to income tax accounting for share-based compensation. Excluding these net tax effects, net income per diluted share was $3.83 in the current-year period, compared to $4.06 in the prior-year period.

Sales by Channel

The following table includes total net sales growth, same store sales (“SSS”) growth/(decline) and e-commerce as a percentage of net sales for the periods indicated below.

		Thirteen Weeks										Preliminary
		Ended			Four Weeks		Four Weeks		Five Weeks			Four Weeks
		December 30, 2023			Fiscal October		Fiscal November		Fiscal December			Fiscal January
Total Net Sales Growth		1.1	%		3.0	%	4.2	%	(1.2)	%		(14.8)	%*
Retail Stores SSS		(9.4)	%		(8.8)	%	(11.5)	%	(8.5)	%		(7.4)	%
E-commerce SSS		(11.5)	%		(16.8)	%	(15.1)	%	(8.4)	%		(12.9)	%
Consolidated SSS		(9.7)	%		(9.7)	%	(11.9)	%	(8.5)	%		(8.1)	%
E-commerce as a % of Net Sales		13.0	%		9.7	%	10.4	%	16.1	%		11.9	%

*Last year’s fiscal January included the week after Christmas, which is a high-sales volume week. In the current year, the week after Christmas was included in the third fiscal quarter.

Balance Sheet Highlights as of December 30, 2023

• Cash of $107 million.
• Zero drawn under our $250 million revolving credit facility.
• Average inventory per store decreased approximately 1% on a same store basis compared to December 24, 2022.

Fiscal Year 2024 Outlook

The Company is providing updated guidance for the fiscal year ending March 30, 2024, superseding in its entirety the previous guidance issued in its second quarter earnings report on November 2, 2023. As a result, for the fiscal year ending March 30, 2024, the Company now expects:

• To open 52 new stores.
• Total sales of $1.654 billion to $1.664 billion, representing a change of (0.2)% to 0.4% over the prior year, which was a 53-week year.
• Same store sales decline of approximately (7.0)% to (6.3)%, with retail store same store sales declines of (6.3)% to (5.5)% and an e-commerce same store sales decline of (11.7)%.
• Gross profit between $605.7 million and $610.6 million, or approximately 36.6% to 36.7% of sales. Gross profit reflects an estimated 170 basis-point increase in merchandise margin, including a 130 basis-point improvement from freight expense. We anticipate 180 basis points of deleverage in buying, occupancy and distribution center costs.
• Selling, general and administrative expenses between $411.8 million and $412.7 million. This represents approximately 24.9% to 24.8% of sales.
• Income from operations between $194.0 million and $198.0 million. This represents approximately 11.7% to 11.9% of sales.
• Net income of $142.8 million to $145.8 million.
• Net income per diluted share of $4.65 to $4.75 based on 30.7 million weighted average diluted shares outstanding.
• Capital expenditures between $95 million and $105 million.

For the fiscal fourth quarter ending March 30, 2024, the Company expects:

• Total sales of $376 million to $386 million, representing a decline of (11.7)% to (9.3)% over the prior year, which was a 14-week quarter.
• Same store sales decline of approximately (9.0)% to (6.3)%, with retail store same store sales declines of (8.5)% to (5.5)% and an e-commerce same store sales decline of (13.0)%.
• Gross profit between $130.7 million and $135.6 million, or approximately 34.8% to 35.2% of sales. Gross profit reflects an estimated 160 basis-point increase in merchandise margin, including a 140 basis-point improvement from freight expense. We anticipate 310 basis points of deleverage in buying, occupancy and distribution center costs.
• Selling, general and administrative expenses between $96.7 and $97.6 million. This represents approximately 25.7% to 25.3% of sales.
• Income from operations between $34.0 million and $38.0 million. This represents approximately 9.0% to 9.8% of sales.
• Net income per diluted share of $0.82 to $0.92 based on 30.7 million weighted average diluted shares outstanding.

Conference Call Information

A conference call to discuss the financial results for the second quarter of fiscal year 2024 is scheduled for today, January 31, 2024, at 4:30 p.m. ET (1:30 p.m. PT). Investors and analysts interested in participating in the call are invited to dial [phone]. The conference call will also be available to interested parties through a live webcast at investor.bootbarn.com. Please visit the website and select the “Events and Presentations” link at least 15 minutes prior to the start of the call to register and download any necessary software. A Supplemental Financial Presentation is also available on the investor relations section of the Company’s website. A telephone replay of the call will be available until March 2, 2024, by dialing [phone] (domestic) or [phone] (international) and entering the conference identification number: 13744029. Please note participants must enter the conference identification number in order to access the replay.

About Boot Barn

Boot Barn is the nation’s leading lifestyle retailer of western and work-related footwear, apparel and accessories for men, women and children. The Company offers its loyal customer base a wide selection of work and lifestyle brands. As of the date of this release, Boot Barn operates 382 stores in 44 states, in addition to an e-commerce channel www.bootbarn.com. The Company also operates www.sheplers.com, the nation’s leading pure play online western and work retailer and www.countryoutfitter.com, an e-commerce site selling to customers who live a country lifestyle. For more information, call 888-Boot-Barn or visit www.bootbarn.com.

Forward Looking Statements

This press release contains forward-looking statements that are subject to risks and uncertainties. All statements other than statements of historical fact included in this press release are forward-looking statements. Forward-looking statements refer to our current expectations and projections relating to, by way of example and without limitation, our financial condition, liquidity, profitability, results of operations, margins, plans, objectives, strategies, future performance, business and industry. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “anticipate”, “estimate”, “expect”, “project”, “plan“, “intend”, “believe”, “may”, “might”, “will”, “could”, “should”, “can have”, “likely”, “outlook” and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events, but not all forward-looking statements contain these identifying words. These forward-looking statements are based on assumptions that the Company’s management has made in light of their industry experience and on their perceptions of historical trends, current conditions, expected future developments and other factors they believe are appropriate under the circumstances. As you consider this press release, you should understand that these statements are not guarantees of performance or results. They involve risks, uncertainties (some of which are beyond the Company’s control) and assumptions. These risks, uncertainties and assumptions include, but are not limited to, the following: decreases in consumer spending due to declines in consumer confidence, local economic conditions or changes in consumer preferences; the Company’s ability to effectively execute on its growth strategy; and the Company’s failure to maintain and enhance its strong brand image, to compete effectively, to maintain good relationships with its key suppliers, and to improve and expand its exclusive product offerings. The Company discusses the foregoing risks and other risks in greater detail under the heading “Risk factors” in the periodic reports filed by the Company with the Securities and Exchange Commission. Although the Company believes that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect the Company’s actual financial results and cause them to differ materially from those anticipated in the forward-looking statements. Because of these factors, the Company cautions that you should not place undue reliance on any of these forward-looking statements. New risks and uncertainties arise from time to time, and it is impossible for the Company to predict those events or how they may affect the Company. Further, any forward-looking statement speaks only as of the date on which it is made. Except as required by law, the Company does not intend to update or revise the forward-looking statements in this press release after the date of this press release.

Boot Barn Holdings, Inc. Consolidated Balance Sheets (In thousands, except per share data) (Unaudited)
		December 30,				April 1,
		2023				2023
Assets
Current assets:
Cash and cash equivalents		$	107,166			$	18,193
Accounts receivable, net			10,380				13,145
Inventories			563,378				589,494
Prepaid expenses and other current assets			54,205				48,341
Total current assets			735,129				669,173
Property and equipment, net			308,085				257,143
Right-of-use assets, net			366,745				326,623
Goodwill			197,502				197,502
Intangible assets, net			60,710				60,751
Other assets			5,334				6,189
Total assets		$	1,673,505			$	1,517,381
Liabilities and stockholders’ equity
Current liabilities:
Line of credit		$	—			$	66,043
Accounts payable			131,655				134,246
Accrued expenses and other current liabilities			152,704				122,958
Short-term lease liabilities			59,243				51,595
Total current liabilities			343,602				374,842
Deferred taxes			39,949				33,260
Long-term lease liabilities			375,345				330,081
Other liabilities			3,664				2,748
Total liabilities			762,560				740,931
Stockholders’ equity:
Common stock, $0.0001 par value; December 30, 2023 - 100,000 shares authorized, 30,528 shares issued; April 1, 2023 - 100,000 shares authorized, 30,072 shares issued			3				3
Preferred stock, $0.0001 par value; 10,000 shares authorized, no shares issued or outstanding			—				—
Additional paid-in capital			229,322				209,964
Retained earnings			693,587				576,030
Less: Common stock held in treasury, at cost, 227 and 192 shares at December 30, 2023 and April 1, 2023, respectively			(11,967	)			(9,547	)
Total stockholders’ equity			910,945				776,450
Total liabilities and stockholders’ equity		$	1,673,505			$	1,517,381

Boot Barn Holdings, Inc. Consolidated Statements of Operations (In thousands, except per share data) (Unaudited)
		Thirteen Weeks Ended								Thirty-Nine Weeks Ended
		December 30,				December 24,				December 30,				December 24,
		2023				2022				2023					2022
Net sales		$	520,399			$	514,553			$	1,278,550			$	1,231,954
Cost of goods sold			321,292				326,739				803,564				777,214
Gross profit			199,107				187,814				474,986				454,740
Selling, general and administrative expenses			123,960				115,318				315,016				285,669
Income from operations			75,147				72,496				159,970				169,071
Interest expense			522				2,258				2,008				4,345
Other income/(loss), net			351				63				525				(210	)
Income before income taxes			74,976				70,301				158,487				164,516
Income tax expense			19,352				17,529				40,930				40,372
Net income		$	55,624			$	52,772			$	117,557			$	124,144
Earnings per share:
Basic		$	1.84			$	1.77			$	3.90			$	4.17
Diluted		$	1.81			$	1.74			$	3.84			$	4.09
Weighted average shares outstanding:
Basic			30,293				29,813				30,117				29,790
Diluted			30,649				30,294				30,575				30,340

Boot Barn Holdings, Inc. Consolidated Statements of Cash Flows (In thousands) (Unaudited)
		Thirty-Nine Weeks Ended
		December 30,				December 24,
			2023				2022
Cash flows from operating activities
Net income		$	117,557			$	124,144
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			35,801				25,968
Stock-based compensation			10,429				9,562
Amortization of intangible assets			41				47
Noncash lease expense			40,361				35,203
Amortization and write-off of debt issuance fees and debt discount			81				101
Loss on disposal of assets			660				250
Deferred taxes			6,689				506
Changes in operating assets and liabilities:
Accounts receivable, net			2,905				(4,571	)
Inventories			26,116				(117,851	)
Prepaid expenses and other current assets			(5,945	)			(14,430	)
Other assets			855				(3,194	)
Accounts payable			2,588				19,571
Accrued expenses and other current liabilities			28,476				32,785
Other liabilities			916				423
Operating leases			(27,071	)			(21,464	)
Net cash provided by operating activities		$	240,459			$	87,050
Cash flows from investing activities
Purchases of property and equipment		$	(91,297	)		$	(83,056	)
Net cash used in investing activities		$	(91,297	)		$	(83,056	)
Cash flows from financing activities
(Payments)/Borrowings on line of credit, net		$	(66,043	)		$	30,522
Repayments on debt and finance lease obligations			(655	)			(626	)
Tax withholding payments for net share settlement			(2,420	)			(4,501	)
Proceeds from the exercise of stock options			8,929				329
Net cash (used in)/provided by financing activities		$	(60,189	)		$	25,724
Net increase in cash and cash equivalents			88,973				29,718
Cash and cash equivalents, beginning of period			18,193				20,674
Cash and cash equivalents, end of period		$	107,166			$	50,392
Supplemental disclosures of cash flow information:
Cash paid for income taxes		$	45,637			$	58,324
Cash paid for interest		$	1,931			$	4,002
Supplemental disclosure of non-cash activities:
Unpaid purchases of property and equipment		$	15,427			$	27,474

Boot Barn Holdings, Inc. Store Count
		Quarter Ended		Quarter Ended		Quarter Ended		Quarter Ended		Quarter Ended		Quarter Ended		Quarter Ended		Quarter Ended
		December 30,		September 30,		July 1,		April 1,		December 24,		September 24,		June 25,		March 26,
		2023		2023		2023		2023		2022		2022		2022		2022
Store Count (BOP)		371		361		345		333		321		311		300		289
Opened/Acquired		11		10		16		12		12		10		11		11
Closed		—		—		—		—		—		—		—		—
Store Count (EOP)		382		371		361		345		333		321		311		300

Boot Barn Holdings, Inc. Selected Store Data
		Thirteen Weeks Ended												Fourteen Weeks Ended				Thirteen Weeks Ended
		December 30,				September 30,				July 1,				April 1,				December 24,				September 24,				June 25,				March 26,
			2023				2023				2023				2023				2022				2022				2022				2022
Selected Store Data:
Same Store Sales (decline)/growth			(9.7	)%			(4.8	)%			(2.9	)%			(5.5	)%			(3.6	)%			2.3	%			10.0	%			33.3	%
Stores operating at end of period			382				371				361				345				333				321				311				300
Total retail store square footage, end of period (in thousands)			4,153				4,027				3,914				3,735				3,598				3,451				3,333				3,194
Average store square footage, end of period			10,872				10,855				10,841				10,825				10,806				10,751				10,717				10,648
Average net sales per store (in thousands)		$	1,185			$	909			$	958			$	1,088			$	1,320			$	966			$	1,031			$	1,094

 

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The Boot Barn Holdings Stock at the time of publication of the news with a fall of -2,21 % to 66,50EUR on Lang & Schwarz stock exchange (31. Januar 2024, 22:12 Uhr).