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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): March 23, 2017

 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 March 23, 2017, Sportsman’s Warehouse Holdings, Inc. (the “Company”) issued a press release reporting its results of operations for the fourth quarter and fiscal year ended January 28, 2017.  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 March 23, 2017.

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: March 23, 2017 Kevan P. Talbot
   Chief Financial Officer and Secretary
     

EdgarFiling

Exhibit 99.1

Sportsman's Warehouse Holdings, Inc. Announces Fourth Quarter and Fiscal Year 2016 Financial Results

MIDVALE, Utah, March 23, 2017 (GLOBE NEWSWIRE) -- Sportsman's Warehouse Holdings, Inc. ("Sportsman's" or the “Company”) (Nasdaq:SPWH) today announced financial results for the thirteen weeks and fifty-two weeks ended January 28, 2017.

For the thirteen weeks ended January 28, 2017:

John Schaefer, Chief Executive Officer, stated, "The retail environment remained challenging during the fourth quarter and we anniversaried both the San Bernardino tragedy and the executive orders from December and January which created a difficult comparison for our hunting and shooting category. For fiscal year 2016, we continued to strengthen our market share position with 11 new stores and a 10.4% revenue increase over the prior year, maintained flat gross margins in a promotional environment, and managed expenses, inventory and capital expenditures with discipline.”

Mr. Schaefer continued, “Looking at fiscal year 2017, we are taking a conservative approach when planning our hunting and shooting business, particularly for the first half of the year until we anniversary the unfortunate events that took place in Orlando in June 2016. That said, we will remain focused on our strategic initiatives of expanding our store base with 12 planned store openings, maximizing the potential of our loyalty program, enhancing our e-commerce platform, and investing in our store teams and leadership as evidenced by today’s announcement of Jon Barker’s appointment as President and Chief Operating Officer. Despite the choppy environment that we are navigating, we believe there is significant market share opportunity in the outdoor goods space, and our differentiated concept that is resonating with our customers will provide us with key competitive advantages that will allow us to further strengthen our market position and deliver profitable growth.”

For the fifty two weeks ended January 28, 2017:

Balance sheet highlights as of January 28, 2017:

First Quarter and Fiscal Year 2017 Outlook:

For the first quarter of fiscal year 2017, net sales are expected to be in the range of $150.0 million to $155.0 million based on a same store sales decline in the range of 9.0% to 11.0% compared to the corresponding period of fiscal year 2016. Net loss is expected to be in the range of $2.6 million to $3.4 million with diluted loss per share of $0.06 to $0.08 on a weighted average of approximately 42.6 million estimated common shares outstanding.

For fiscal year 2017, net sales are expected to be in the range of $825.0 million to $845.0 million based on a same store sales decline in the range of 4.0% to 6.0% compared to fiscal year 2016. Net income is expected to be in the range of $25.5 million to $29.0 million with earnings per diluted share of $0.60 to $0.68 on a weighted average of approximately 42.8 million estimated common shares outstanding.

The Company's fiscal year 2017 will include 53 weeks, while fiscal year 2016 included 52 weeks. The estimated fiscal year 2017 impact of the additional week is roughly $10.0 to $12.0 million in revenue and approximately $0.01 on earnings per share. There is no impact on expected same store sales as those are presented on a 52 week comparative basis.

Conference Call Information:

A conference call to discuss fourth quarter 2016 financial results is scheduled for today, March 23, 2017, 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 income from operations, adjusted net income, 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, but are not limited to, our outlook for the fourth quarter and full fiscal year 2017.  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 the Company’s Form 10-K for the fiscal year ended January 30, 2016 which was filed with the SEC on March 24, 2016 and the Company’s 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 quality, brand name 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 Fifty-two Weeks Ended  
                
 January 28, 2017 % of net
sales		 January 30, 2016 % of net
sales		 January 28, 2017 % of net
sales		 January 30, 2016 % of net
sales
                
Net sales$221,376  100.0 % $208,548  100.0 % $779,956  100.0 % $706,764  100.0 %
Cost of goods sold 147,068  66.4 %  137,736  66.0 %  516,726  66.3 %  468,234  66.3 %
Gross profit 74,308  33.6 %  70,812  34.0 %  263,230  33.7 %  238,530  33.7 %
                
Operating expenses:               
Selling, general and administrative expenses 53,194  24.0 %  48,703  23.4%  202,543  26.0 %  179,218  25.4%
Income from operations 21,114  9.6 %  22,109  10.6%  60,687  7.7 %  59,312  8.3%
Interest expense (3,271) (1.5%)  (3,589) (1.7%)  (13,402) (1.7%)  (14,156) (2.0%)
Income before income tax expense 17,843  8.1 %  18,520  8.9%  47,285  6.0 %  45,156  6.3%
Income tax expense (7,303) (3.3%)  (7,130) (3.4%)  (17,616) (2.3%)  (17,385) (2.5%)
Net income$10,540  4.8 % $11,390  5.5% $29,669  3.7 % $27,771  3.8%
                
Earnings per share               
Basic$0.25    $0.27    $0.70    $0.66   
Diluted$0.25    $0.27    $0.70    $0.66   
                
Weighted average shares outstanding               
Basic 42,253     42,004     42,187     41,966   
Diluted 42,557     42,404     42,485     42,334   
                

 

SPORTSMAN’S WAREHOUSE HOLDINGS, INC.
Condensed Consolidated Balance Sheets (Unaudited)
(in thousands)
    
    
Assets   
 January 28, 2017 January 30, 2016
Current assets:   
Cash and cash equivalents$1,911  $2,109 
Accounts receivable, net 411   469 
Merchandise inventories 246,289   217,794 
Prepaid expenses and other 7,313   9,337 
Deferred income taxes -   3,001 
Total current assets 255,924   232,710 
Property and equipment, net 83,109   62,432 
Deferred income taxes 5,097   2,263 
Definite lived intangible assets, net 2,118   3,923 
 $346,248  $301,328 
 . .
Liabilities and Stockholders’ Equity (Deficit)   
Current liabilities:   
Accounts payable$31,549  $46,698 
Accrued expenses 49,586   42,480 
Income taxes payable 979   1,779 
Revolving line of credit 60,972   25,263 
Current portion of long-term debt, net of discount and debt issuance costs 983   8,683 
Current portion of deferred rent 3,150   3,018 
Total current liabilities 147,219   127,921 
    
Long-term liabilities:   
Long-term debt, net of discount, debt issuance costs, and current portion 133,721   146,333 
Deferred rent credit, net of current portion 35,307   29,133 
Total long-term liabilities 169,028   175,466 
Total liabilities 316,247   303,387 
    
Stockholders’ equity (deficit):   
Common stock 422   420 
Additional paid-in capital 80,146   77,757 
Accumulated deficit (50,567)  (80,236)
Total stockholders’ equity (deficit) 30,001   (2,059)
 $346,248  $301,328 
    

 

SPORTSMAN’S WAREHOUSE HOLDINGS, INC.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
     
  January 28, 2017 January 30, 2016
CASH FLOWS FROM OPERATING ACTIVITIES     
Net income $29,669  $27,771 
Adjustments to reconcile net income to net     
cash provided by operating activities:     
Depreciation and amortization  12,169   9,763 
Amortization of discount on debt and deferred financing fees  1,122   817 
Amortization of Intangible  1,805   1,806 
Change in deferred rent  6,307   1,161 
Deferred taxes  167   3,062 
Excess tax benefits from stock-based compensation arrangements  (449)  (286)
Stock based compensation  3,186   2,257 
Change in assets and liabilities:     
Accounts receivable, net  58   (44)
Merchandise inventory  (28,495)  (31,885)
Prepaid expenses and other  (1,064)  (5,435)
Accounts payable  (15,530)  18,198 
Accrued expenses  6,888   983 
Income taxes  (351)  7,255 
Net cash provided by operating activities   15,482   35,423 
     
CASH FLOWS FROM INVESTING ACTIVITIES:     
Purchase of property and equipment  (39,417)  (33,957)
Proceeds from sale-leaseback transactions  11,923   19,006 
Net cash used in investing activities   (27,494)  (14,951)
     
CASH FLOWS FROM FINANCING ACTIVITIES:     
Net borrowings on LOC  35,709   (16,636)
Increase in book overdraft  (1,827)  (1,123)
Issuance of common stock per employee stock purchase plan  433   - 
Excess tax benefits from stock-based compensation  -   286 
Payment of withholdings on restricted stock units  (1,228)  (1,041)
Principal payments on long-term debt  (21,273)  (1,600)
Net cash provided by (used in) financing activities   11,814   (20,114)
     
Net change in cash and cash equivalents  (198)  358 
Cash and cash equivalents at beginning of year  2,109   1,751 
Cash and cash equivalents at end of period $1,911  $2,109 
     

 

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 Fifty-two Weeks Ended
  January 28, 2017 January 30, 2016 January 28, 2017 January 30, 2016
Income from operations$21,114 $22,109 $60,687  $59,312 
Secondary offering expenses (1) -  -  143   727 
Litigation accrual reversal (2) -  -  -   (4,000)
Adjusted income from operations$21,114 $22,109 $60,830  $56,039 
         
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$10,540 $11,390 $29,669  $27,771 
 Secondary offering expenses (1) -  -  143   727 
 Prior year tax credits (3) -  -  (602)  - 
 Litigation accrual reversal (2) -  -  -   (4,000)
 Less tax impact of the above items -  -  -   1,260 
 Adjusted net income$10,540 $11,390 $29,210  $25,758 
         
Denominator:       
 Diluted weighted average shares outstanding 42,557  42,404  42,485   42,334 
         
Reconciliation of earnings per share:       
Dilutive earnings per share$0.25 $0.27 $0.70  $0.66 
Impact of adjustments to numerator -  -  (0.01)  (0.05)
Adjusted earnings per share$0.25 $0.27 $0.69  $0.61 
         
Reconciliation of net income to adjusted EBITDA:       
Net income$10,540 $11,390 $29,669  $27,771 
Interest expense 3,271  3,589  13,402   14,156 
Income tax expense 7,303  7,130  17,616   17,385 
Depreciation and amortization 3,812  3,005  13,974   11,569 
Stock-based compensation expense (4) 685  586  3,186   2,257 
Pre-opening expenses (5) 755  462  4,264   3,159 
Secondary offering expenses (1) -  -  143   727 
Litigation accrual reversal (2) -  -  -   (4,000)
Adjusted EBITDA$26,366 $26,162 $82,254  $73,024 
         
(1) Expenses paid by us in connection with secondary offerings of our common stock by affiliates of Seidler Equity Partners III, L.P.
(2) Based on the court’s most recent judgment in our favor regarding the Lacey Marketplace litigation, we determined that the likelihood of loss in this case is not probable, and, as such, we reversed the previous accrual of $4.0 million in our results for the fiscal year ended January 30, 2016.
(3) Tax credits recognized in the year that were not previously taken in prior years.
(4) Stock-based compensation expense represents non-cash expenses related to equity instruments granted to employees under our 2013 Performance Incentive Plan and Employee Stock Purchase Plan.
(5) 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.
         

Investor Contact:
ICR, Inc.
Farah Soi/Rachel Schacter
(203) 682-8200
investors@sportsmanswarehouse.com