Lands' End Raises Fourth Quarter Fiscal 2020 Guidance and Updates Long-term Financial Targets
For the Fourth Quarter of Fiscal 2020 the Company Expects:
- Net revenue to be between
$528 millionand $533 million, an increase from prior guidance of $500 millionto $520 million.
- Net income to be between
$17.5 millionand $19.0 millionand diluted earnings per share to be between $0.54and $0.58, an increase from prior guidance of Net income between $13.5 millionand $17.5 millionand diluted earnings per share between $0.41and $0.53.
- Adjusted EBITDA to be between
$43 millionand $45 million, an increase from prior guidance of $38 millionto $43 million.
Long-Term Financial Targets:
- Revenue of
$1.9 billionto $2.1 billion, representing a CAGR of 10% to 14% over the next three years, assuming and driven by:
- Organic growth in both
U.S.and international eCommerce businesses
- Extended recovery in Outfitters business post-pandemic
- Third-party channel expansion
- Organic growth in both
- Adjusted EBITDA margin in high-single-digit range, assuming and as a result of:
- Stable to slightly higher gross margin
- Improved SG&A rate
ICR Conference Participation
The Company will be participating in the 23rd Annual
The audio portion of the fireside chat presentation will be webcast live over the internet and can be accessed at the investor relations section of its website at http://investors.landsend.com. An online archive will be available for a period of 90 days following the presentation. In addition, the Company plans to post an investor presentation to the investor relations section of its website prior to the webcast.
This press release contains forward-looking statements that involve risks and uncertainties, including statements regarding the Company’s assessment of its ability to execute its long-term growth strategies and the expected benefits of those strategies; the Company’s belief and assessment of future growth opportunities; the Company’s outlook and expectations as to net revenue, net income, earnings per share and Adjusted EBITDA for the fourth quarter of fiscal 2020; and the Company’s long-term financial targets for revenue and Adjusted EBITDA margin, the assumptions and drivers of such targets, including organic growth in US and international eCommerce businesses, an extended recovery in the Outfitters business post-pandemic, expansion of the third-party channel, stable to slightly higher gross margin and improved SG&A rate, and the expected timing of the achievement of the long-term financial targets. The following important factors and uncertainties, among others, could cause actual results to differ materially from those described in these forward-looking statements: the impact of COVID-19 on operations, customer demand and the Company’s supply chain, as well as its consolidated results of operation, financial position and cash flows; the Company may be unsuccessful in implementing its strategic initiatives, or its initiatives may not have their desired impact on its business; the Company’s ability to offer merchandise and services that customers want to purchase; changes in customer preference from the Company’s branded merchandise; the Company’s results may be materially impacted if tariffs on imports to
Chief Operating Officer and Chief Financial Officer
Use and Definition of Non-GAAP Financial Measures in Relation to Guidance
Adjusted EBITDA - In addition to our Net income, for purposes of evaluating operating performance, we use an Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA"), which is adjusted to exclude certain significant items as set forth below. Our management uses Adjusted EBITDA to evaluate the operating performance of our business, as well as for executive compensation metrics, for comparable periods. Adjusted EBITDA should not be used by investors or other third parties as the sole basis for formulating investment decisions as it excludes several important cash and non-cash recurring items.
The methods used by the Company to calculate its non-GAAP financial measures may differ significantly from methods used by other companies to compute similar measures. As a result, any non-GAAP financial measures presented herein may not be comparable to similar measures provided by other companies.
While Adjusted EBITDA is a non-GAAP measurement, management believes that it is an important indicator of operating performance, and useful to investors, because:
- EBITDA excludes the effects of financings, investing activities and tax structure by eliminating the effects of interest, depreciation and income tax.
- Other significant items, while periodically affecting our results, may vary significantly from period to period and have a disproportionate effect in a given period, which affects comparability of results.
Reconciliation of Non-GAAP Financial Information to GAAP
|Fiscal 2020 Fourth Quarter Guidance
|13 Weeks Ended
|Depreciation, interest, other income, taxes and other adjustments
Source: Lands' End