View:
Download DOC
Download PDF
Download XLS
Form 8-K Filing
 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) September 11, 2014 

SPORTSMAN'S WAREHOUSE HOLDINGS, INC.
(Exact Name of Registrant as Specified in Its Charter)

  DELAWARE  
  (State or Other Jurisdiction of Incorporation)  

001-36401 39-1975614
(Commission File Number) (I.R.S. Employer Identification No.)

7035 South High Tech Drive,
Midvale, Utah		 84047
(Address of Principal Executive Offices) (Zip Code)

(801) 566-6681
(Registrant's Telephone Number, Including Area Code)

  (Not Applicable)  
  (Former Name or Former Address, if Changed Since Last Report)  

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

    [   ]   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
    [   ]   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
    [   ]   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
    [   ]   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 

Item 2.02. Results of Operations and Financial Condition.

On September 11, 2014, Sportsman's Warehouse Holdings, Inc. (the "Company") issued a press release reporting its results of operations for the fiscal quarter ended August 2, 2014. The press release is furnished herewith as Exhibit 99.1 and is specifically incorporated by reference herein.

The information in this Form 8-K and the related information in the exhibit attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section and shall not be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing, except as shall be expressly set forth by specific reference in any such filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

99.1 Press release of Sportsman's Warehouse Holdings, Inc., dated September 11, 2014.

SIGNATURE

    Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

       SPORTSMAN'S WAREHOUSE HOLDINGS, INC.
       
       
By: /s/   KEVAN P. TALBOT
Date: September 11, 2014 Kevan P. Talbot
Chief Financial Officer and Secretary

Sportsman's Warehouse Holdings, Inc. Announces Second Quarter 2014 Financial Results

EXHIBIT 99.1

Sportsman's Warehouse Holdings, Inc. Announces Second Quarter 2014 Financial Results

MIDVALE, Utah, Sept. 11, 2014 (GLOBE NEWSWIRE) -- Sportsman's Warehouse Holdings, Inc. (Nasdaq:SPWH) ("Sportsman's" or the "Company") today announced financial results for the thirteen weeks ended August 2, 2014.

For the thirteen weeks ended August 2, 2014:

John Schaefer, President and Chief Executive Officer, stated: "We are pleased with our second quarter results which came in better than our expectations, driven by strong results from our categories outside of hunting and solid new store performance."

Mr. Schaefer added: "Industry dynamics suggest potential stabilization of the hunting category as we enter the fall hunting season. We continue to see significant opportunities to capture additional share of the outdoor sporting goods market given the fragmented nature of the industry and our unique positioning and value proposition. We remain excited about the many opportunities that we have to grow the company and continue to expand the Sportsman's Warehouse brand."

For the twenty-six weeks ended August 2, 2014:

Balance sheet highlights as of August 2, 2014:

Net proceeds of $3.0 million from the underwriter's partial exercise of the over-allotment option related to the Company's IPO in April 2014 have been included in the Company's financial statements for the quarter ended August 2, 2014, as this exercise took place during the Company's fiscal second quarter.

Third Quarter and Fiscal 2014 Outlook:

For the third quarter of fiscal 2014, net sales are expected to be in the range of $183.0 million to $188.0 million based on the opening of one new store on August 16, 2014 and a decrease in same store sales from the third quarter of fiscal year 2013 in the range of 4.0% to 6.0%. Net income is expected to be in the range of $7.8 million to $8.6 million, with diluted earnings per share of $0.19 to $0.20 on a weighted average of approximately 42.0 million estimated common shares outstanding.

For fiscal 2014, net sales are expected to be in the range of $665.0 million to $675.0 million based on opening eight new stores for the full year and a decrease in same store sales from fiscal year 2013 in the range of 6.0% to 8.0%. Net income is expected to be in the range of $18.2 million to $20.3 million, with diluted earnings per share of $0.43 to $0.48 (which includes the impact of $1.4 million in expenses related to IPO bonuses, net of taxes) on approximately 42.0 million estimated weighted average common shares outstanding. Excluding $1.4 million, or $0.04 per adjusted diluted share, in expenses related to the IPO bonuses, adjusted net income for fiscal 2014 is expected to be in the range of $19.6 million to $21.7 million, or $0.47 to $0.52 per diluted share, based on a weighted average diluted share count of 42.0 million.

Conference Call Information:

A conference call to discuss second quarter fiscal 2014 financial results is scheduled for today, September 11, 2014, at 4:30 PM Eastern Time. The conference call will be webcast and may be accessed via the Investor Relations section of the Company's website at www.sportsmanswarehouse.com.

Non-GAAP Information

This press release includes the following financial measures defined as non-GAAP financial measures by the Securities and Exchange Commission (the "SEC"): adjusted (loss) income from operations, adjusted net (loss) income, adjusted diluted weighted average shares outstanding, adjusted diluted earnings per share and adjusted EBITDA. The Company has reconciled these non-GAAP financial measures with the most directly comparable GAAP financial measures under "GAAP and Non-GAAP Measures" in this release. The Company believes that these non-GAAP financial measures not only provide its management with comparable financial data for internal financial analysis but also provide meaningful supplemental information to investors. Specifically, these non-GAAP financial measures allow investors to better understand the performance of the Company's business and facilitate a more meaningful comparison of its diluted income per share and actual results on a period-over-period basis. The Company has provided this information as a means to evaluate the results of its ongoing operations. Other companies in the Company's industry may calculate these items differently than it does. Each of these measures is not a measure of performance under GAAP and should not be considered as a substitute for the most directly comparable financial measures prepared in accordance with GAAP. Non-GAAP financial measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the Company's results as reported under GAAP.

Forward-Looking Statements 

This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 as contained in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements in this release include our expectations for growth, long-term goals, the potential stabilization of the hunting category and outlook for the third quarter and full fiscal year 2014.  Investors can identify these statements by the fact that they use words such as "continue," "expect," "may," "opportunity" "plan," "future" "ahead" and similar terms and phrases. The Company cannot assure investors that future developments affecting the Company will be those that it has anticipated. Actual results may differ materially from these expectations due to risks relating to the Company's retail-based business model, general economic conditions and consumer spending, the Company's concentration of stores in the Western United States, competition in the outdoor activities and sporting goods market, changes in consumer demands, the company's expansion into new markets and planned growth, current and future government regulations, risks related to the Company's continued retention of its key management, the Company's distribution center, quality or safety concerns about the Company's merchandise, events that may affect the Company's vendors, trade restrictions, and other factors that are set forth in the Company's filings with the SEC, including under the caption "Risk Factors" in our Form 10-Q for the fiscal quarter ended May 3, 2014 filed with the SEC on June 11, 2014 and our other public filings made with the SEC and available at www.sec.gov. If one or more of these risks or uncertainties materialize, or if any of the Company's assumptions prove incorrect, the Company's actual results may vary in material respects from those projected in these forward-looking statements. Any forward-looking statement made by the Company in this release speaks only as of the date on which the Company makes it. Factors or events that could cause the Company's actual results to differ may emerge from time to time, and it is not possible for the Company to predict all of them. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by any applicable securities laws.

About Sportsman's Warehouse Holdings, Inc.

Sportsman's Warehouse is a high-growth outdoor sporting goods retailer focused on meeting the everyday needs of the seasoned outdoor veteran, the first-time participant and every enthusiast in between. Our mission is to provide a one-stop shopping experience that equips our customers with the right hunting, shooting, fishing and camping gear to maximize their enjoyment of the outdoors.

For press releases and certain additional information about the Company, visit the Investor Relations section of the Company's website at www.sportsmanswarehouse.com.

 
SPORTSMAN'S WAREHOUSE HOLDINGS, INC.
Condensed Consolidated Statements of Income (Unaudited)
(in thousands, except share and per share data)
                 
  For the Thirteen Weeks Ended   For the Twenty Six Weeks Ended  
                 
  August 2, 2014 % of net
sales		 August 3, 2013 % of net
sales		 August 2, 2014 % of net
sales		 August 3, 2013 % of net
sales
                 
Net sales  $ 159,468 100.0%  $ 155,857 100.0%  $ 291,893 100.0%  $ 292,377 100.0%
Cost of goods sold  106,641 66.9%  103,665 66.5%  198,938 68.2%  197,254 67.5%
Gross profit  52,827 33.1%  52,192 33.5%  92,955 31.8%  95,123 32.5%
                 
Operating expenses:                
Selling, general and administrative expenses  40,484 25.4%  36,142 23.2%  80,833 27.7%  68,402 23.4%
Bankruptcy and other restructuring charges  --  0.0%  --  0.0%  --  0.0%  55 0.0%
   40,484 25.4%  36,142 23.2%  80,833 27.7%  68,457 23.4%
Income from operations  12,343 7.7%  16,050 10.3%  12,122 4.2%  26,666 9.1%
Interest expense  (4,107) (2.6%)  (3,365) (2.2%)  (9,365) (3.2%)  (6,593) (2.3%)
Income before income tax expense  8,236 5.2%  12,685 8.1%  2,757 0.9%  20,073 6.9%
Income tax expense  (3,173) (2.0%)  (5,029) (3.2%)  (1,062) (0.4%)  (7,958) (2.7%)
Net income  $ 5,063 3.2%  $ 7,656 4.9%  $ 1,695 0.6%  $ 12,115 4.1%
                 
Earnings per share                
Basic  $ 0.12    $ 0.23    $ 0.04    $ 0.36  
Diluted  $ 0.12    $ 0.23    $ 0.04    $ 0.36  
                 
Weighted average shares outstanding                
Basic  41,768    33,229    38,105    33,229  
Diluted  41,966    33,229    38,315    33,229  
 
SPORTSMAN'S WAREHOUSE HOLDINGS, INC.
Condensed Consolidated Balance Sheets (Unaudited)
(in thousands)
 
Assets      
  August 2, 2014  February 1, 2014
Current assets:      
Cash and cash equivalents  $ 1,652  $ 1,354  
Accounts receivable, net  372  413  
Merchandise inventories, net  207,381  161,334  
Prepaid expenses and other  8,823  7,753  
Income taxes receivable  2,431  2,229  
Deferred income taxes  8,548  3,233  
Total current assets  229,207  176,316  
 Property and equipment, net  47,917  31,494  
 Deferred income taxes  6,051  6,051  
 Definite lived intangible assets, net   6,632  7,535  
 Other long-term assets, net  2,525  2,833  
   $ 292,332  $ 224,229  
  . .  
Liabilities and Stockholders' Deficit      
Current liabilities:      
Accounts payable  $ 49,687  $ 27,664  
Accrued expenses and other liabilities  36,130  31,884  
Revolving line of credit  62,915  29,052  
Current portion of long-term debt, net of discount  1,860  1,860  
Current portion of deferred rent  2,482  2,640  
Total current liabilities  153,074  93,100  
       
Long-term liabilities:      
Long-term debt, net of discount and current portion  155,042  229,272  
Deferred rent credit, net of current portion  28,672  22,953  
Total long-term liabilities  183,714  252,225  
Total liabilities  336,788  345,325  
       
Stockholders' deficit:      
Common stock  418  273  
Restricted stock  --   57  
Additional paid-in capital  75,222  365  
Accumulated deficit  (120,096)  (121,791)  
Total stockholders' deficit  (44,456)  (121,096)  
   $ 292,332  $ 224,229  
 
SPORTSMAN'S WAREHOUSE HOLDINGS, INC.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
     
Increase (Decrease) in Cash August 2, 2014 August 3, 2013
CASH FLOWS FROM OPERATING ACTIVITIES     
Net income   $ 1,695  $ 12,115
Adjustments to reconcile net income to net cash used in operating activities:     
Depreciation and amortization   3,841  2,551
Amortization of Intangible   903  613
Change in deferred rent   5,561  66
Deferred taxes   (202)  (499)
Stock based compensation   2,258  --
Change in assets and liabilities:     
Accounts receivable   41  1,266
Merchandise inventory   (46,047)  (44,769)
Prepaid expenses and other   (1,191)  1,447
Accounts payable   22,023  16,527
Accrued expenses   (1,685)  (1,047)
Income taxes   (5,315)  (9,395)
Net cash used in operating activities   (18,118)  (21,125)
     
CASH FLOWS FROM INVESTING ACTIVITIES:     
Purchase of property and equipment   (19,590)  (11,885)
Acquisition   --  (47,767)
Net cash used in investing activities   (19,590)  (59,652)
     
CASH FLOWS FROM FINANCING ACTIVITIES:     
Net borrowings on LOC   33,863  40,920
Issuance of common stock   73,393  --
Increase in book overdraft   5,931  7,946
Excess tax benefits from stock-based compensation   287  --
Payment of withholdings on restricted stock units   (993)  --
Payment of deferred financing costs   --  (9)
Principal payments on other notes payable   --  (2,756)
Principal payments on term loan   (74,475)  (625)
Net cash provided by financing activities   38,006  45,476
     
Net change in cash and cash equivalents   298  (35,301)
Cash and cash equivalents at beginning of year   1,354  36,515
Cash and cash equivalents at end of year   $ 1,652  $ 1,214
 
SPORTSMAN'S WAREHOUSE HOLDINGS, INC.
GAAP and Non-GAAP Measures (Unaudited)
(in thousands, except per share data)
         
Reconciliation of GAAP income from operations to adjusted income from operations:      
         
  For the Thirteen Weeks Ended For the Twenty Six Weeks Ended
  August 2, 2014 August 3, 2013 August 2, 2014 August 3, 2013
Income from operations  $ 12,343  $ 16,050  $ 12,122  $ 26,666
IPO bonus  --   --   2,200  -- 
Adjusted income from operations  $ 12,343  $ 16,050  $ 14,322  $ 26,666
         
Reconciliation of GAAP net income and GAAP diluted weighted average shares outstanding to adjusted net income and adjusted weighted average shares outstanding:    
         
Numerator:        
Net income  $ 5,063  $ 7,656  $ 1,695  $ 12,115
IPO bonus  --   --   2,200  -- 
Less tax benefit related to IPO bonus  --   --   (847)  -- 
Adjusted net income   $ 5,063  $ 7,656  $ 3,048  $ 12,115
         
Denominator:        
Diluted weighted average shares outstanding  41,966  33,229  38,315  33,229
Initial public offering shares issuance (1)  50  8,683  3,714  8,683
Adjusted diluted weighted average shares outstanding  42,016  41,912  42,029  41,912
         
Earnings per share:        
Earnings per share  $ 0.12  $ 0.23  $ 0.04  $ 0.36
Impact of adjustments to numerator and denominator  --   (0.05)  0.03  (0.07)
Adjusted earnings per common share  $ 0.12  $ 0.18  $ 0.07  $ 0.29
         
Reconciliation of net income to adjusted EBITDA:        
Net income  $ 5,063  $ 7,656  $ 1,695  $ 12,115
Interest expense  4,107  3,365  9,365  6,593
Income tax expense  3,173  5,029  1,062  7,958
Depreciation and amortization  2,218  1,515  4,070  2,426
Stock-based compensation expense (2)  524  --   2,258  -- 
Pre-opening expenses (3)  904  142  2,129  837
IPO bonus (4)  --   --   2,200  -- 
Bankruptcy-related expenses (5)  --   --   --   55
Acquisition expenses (6)  --   154  --   2,324
Adjusted EBITDA  $ 15,989  $ 17,861  $ 22,779  $ 32,308
         
(1) Assumes our initial public offering was effective as of February 3, 2013, the first day of our fiscal year 2013.    
(2) Stock-based compensation expense represents non-cash expenses related to equity instruments granted to employees under our 2013 Performance Incentive Plan.
(3) Pre-opening expenses include expenses incurred in the preparation and opening of a new store location, such as payroll, travel and supplies, but do not include the cost of the initial inventory or capital expenditures required to open a location.
(4) As a result of the completion of our initial public offering and pursuant to the terms of the employment agreements with our executive officers, we paid $2.2 million in bonuses to our executive officers.
(5) On March 21, 2009, Sportsman's Warehouse Holdings, Inc. and its subsidiaries filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code, seeking to reorganize the business under the provisions of the Bankruptcy Code. The plan of reorganization under the Bankruptcy Code was confirmed by the United States Bankruptcy Court for the District of Delaware on July 30, 2009 and became effective when all material conditions of the plan of reorganization were satisfied on August 14, 2009. We incurred certain costs related to our restructuring and emergence from Chapter 11 bankruptcy and included a liability as part of the reorganization value at August 14, 2009, the date of emergence from bankruptcy. Bankruptcy-related expenses are those amounts that are greater than the initial estimated restructuring costs, whereas bankruptcy-related benefits are those amounts that are less than the initial estimated costs. They are expensed as incurred.
(6) Acquisition expenses for the 26 and 13 weeks ended August 3, 2013 relate to the costs associated with the acquisition of our ten previously operated stores in Montana, Oregon and Washington. 
CONTACT: Investor Contact:
         ICR, Inc.
         Farah Soi/Rachel Schacter
         (203) 682-8200
         investors@sportsmanswarehouse.com