falsedesktopSSI2019-11-02000000688519000224{"tbl_sim": "https://q10k.com/tbl-sim", "search": "https://q10k.com/search"}{"q10k_tbl_0": "Large accelerated filer\t☐\tAccelerated filer\t☑\nNon-accelerated filer\t☐\tSmaller reporting company\t☑\n\t\tEmerging growth company\t☐\n", "q10k_tbl_1": "TABLE OF CONTENTS\t\t\nPART I FINANCIAL INFORMATION\t\t\n\t\tPage No.\nItem 1.\tFinancial Statements (Unaudited)\t\n\tCondensed Consolidated Balance Sheets\t\n\tNovember 2 2019 February 2 2019 and November 3 2018\t4\n\tCondensed Consolidated Statements of Operations and Comprehensive Loss\t\n\tThree and Nine Months Ended November 2 2019 and November 3 2018\t5\n\tCondensed Consolidated Statements of Cash Flows\t\n\tNine Months Ended November 2 2019 and November 3 2018\t6\n\tCondensed Consolidated Statements of Stockholders' Equity\t\n\tThree and Nine Months Ended November 2 2019 and November 3 2018\t7\n\tNotes to Condensed Consolidated Financial Statements (Unaudited)\t9\nItem 2.\tManagement's Discussion and Analysis of Financial Condition and Results of Operations\t27\nItem 3.\tQuantitative and Qualitative Disclosures about Market Risk\t36\nItem 4.\tControls and Procedures\t36\nPART II OTHER INFORMATION\t\t\nItem 1.\tLegal Proceedings\t36\nItem 1A.\tRisk Factors\t37\nItem 2.\tUnregistered Sales of Equity Securities and Use of Proceeds\t38\nItem 3.\tDefaults Upon Senior Securities\t39\nItem 4.\tMine Safety Disclosures\t39\nItem 5.\tOther Information\t39\nItem 6.\tExhibits\t39\nSIGNATURES\t\t40\n", "q10k_tbl_2": "\tNovember 2 2019\tFebruary 2 2019\tNovember 3 2018\nASSETS\t\t\t\nCash and cash equivalents\t26268\t15830\t25825\nMerchandise inventories net\t581495\t424555\t602283\nPrepaid expenses and other current assets\t43754\t52518\t47181\nTotal current assets\t651517\t492903\t675289\nProperty equipment and leasehold improvements net of accumulated depreciation of $778376 $733366 and $736014 respectively\t181716\t224803\t229942\nOperating lease assets\t319036\t0\t0\nIntangible assets\t1900\t2225\t17135\nOther non-current assets net\t19544\t24230\t23152\nTotal assets\t1173713\t744161\t945518\nLIABILITIES AND STOCKHOLDERS' EQUITY\t\t\t\nAccounts payable\t176304\t106825\t190070\nCurrent portion of debt obligations\t5000\t4812\t3555\nCurrent portion of operating lease liabilities\t75709\t0\t0\nAccrued expenses and other current liabilities\t86767\t65715\t80320\nTotal current liabilities\t343780\t177352\t273945\nLong-term debt obligations\t360123\t250294\t345840\nLong-term operating lease liabilities\t275604\t0\t0\nOther long-term liabilities\t30703\t61990\t62809\nTotal liabilities\t1010210\t489636\t682594\nCommitments and contingencies\t\t\t\nCommon stock par value $0.01 100000 shares authorized 34076 33469 and 33458 shares issued respectively\t341\t335\t335\nAdditional paid-in capital\t426606\t423535\t422539\nTreasury stock at cost 5175 shares respectively\t(44444)\t(43579)\t(43527)\nAccumulated other comprehensive loss\t(6566)\t(5857)\t(5731)\nAccumulated deficit\t(212434)\t(119909)\t(110692)\nTotal stockholders' equity\t163503\t254525\t262924\nTotal liabilities and stockholders' equity\t1173713\t744161\t945518\n", "q10k_tbl_3": "\tThree Months Ended\t\tNine Months Ended\t\n\tNovember 2 2019\tNovember 3 2018\tNovember 2 2019\tNovember 3 2018\nNet sales\t399302\t347100\t1094888\t1060623\nCredit income\t15678\t13324\t42774\t43143\nTotal revenues\t414980\t360424\t1137662\t1103766\nCost of sales and related buying occupancy and distribution expenses\t315494\t278665\t888297\t847213\nSelling general and administrative expenses\t111180\t109774\t324066\t327965\nInterest expense\t4070\t3350\t12187\t8253\nLoss before income tax\t(15764)\t(31365)\t(86888)\t(79665)\nIncome tax expense (benefit)\t150\t(12)\t450\t288\nNet loss\t(15914)\t(31353)\t(87338)\t(79953)\nOther comprehensive income (loss):\t\t\t\t\nAmortization of employee benefit related costs net of tax of $0 respectively\t186\t85\t558\t439\nPension settlement charges net of tax of $0 respectively\t270\t411\t270\t411\nEmployee benefit related adjustment net of tax of $0 respectively\t(1537)\t(1404)\t(1537)\t(1404)\nTotal other comprehensive loss\t(1081)\t(908)\t(709)\t(554)\nComprehensive loss\t(16995)\t(32261)\t(88047)\t(80507)\nNet loss per share:\t\t\t\t\nBasic\t(0.55)\t(1.11)\t(3.04)\t(2.85)\nDiluted\t(0.55)\t(1.11)\t(3.04)\t(2.85)\nWeighted average shares outstanding:\t\t\t\t\nBasic\t28886\t28261\t28706\t28059\nDiluted\t28886\t28261\t28706\t28059\n", "q10k_tbl_4": "\tNine Months Ended\t\n\tNovember 2 2019\tNovember 3 2018\nCash flows from operating activities:\t\t\nNet loss\t(87338)\t(79953)\nAdjustments to reconcile net loss to net cash used in operating activities:\t\t\nDepreciation and amortization of long-lived assets\t45144\t44135\nImpairment of long-lived assets\t11295\t1070\nGain on retirements of property equipment and leasehold improvements\t(302)\t(505)\nNon-cash operating lease expense\t52617\t0\nStock-based compensation expense\t2276\t3854\nDividends charged to compensation expense\t21\t0\nAmortization of debt issuance costs\t512\t248\nDeferred compensation obligation\t865\t229\nAmortization of employee benefit related costs and pension settlement charges\t828\t850\nConstruction allowances from landlords\t4833\t757\nOther changes in operating assets and liabilities:\t\t\nIncrease in merchandise inventories\t(156940)\t(163906)\nDecrease in other assets\t15111\t4910\nDecrease in operating lease liabilities\t(56234)\t0\nIncrease in accounts payable and other liabilities\t90402\t51394\nNet cash used in operating activities\t(76910)\t(136917)\nCash flows from investing activities:\t\t\nAdditions to property equipment and leasehold improvements\t(25145)\t(21793)\nProceeds from insurance and disposal of assets\t2887\t2349\nNet cash used in investing activities\t(22258)\t(19444)\nCash flows from financing activities:\t\t\nProceeds from revolving credit facility borrowings\t419397\t481384\nPayments of revolving credit facility borrowings\t(305818)\t(338100)\nProceeds from long-term debt obligation\t0\t25000\nPayments of long-term debt obligations\t(3008)\t(2224)\nPayments of debt issuance costs\t(36)\t(358)\nPayments for stock related compensation\t(929)\t(424)\nCash dividends paid\t0\t(4342)\nNet cash provided by financing activities\t109606\t160936\nNet increase in cash and cash equivalents\t10438\t4575\nCash and cash equivalents:\t\t\nBeginning of period\t15830\t21250\nEnd of period\t26268\t25825\nSupplemental disclosures including non-cash investing and financing activities:\t\t\nInterest paid\t11652\t8097\nIncome taxes paid (refunded)\t417\t(11)\nUnpaid liabilities for capital expenditures\t3255\t3624\n", "q10k_tbl_5": "\tCommon Stock\t\tAdditional Paid-in Capital\tTreasury Stock\t\tAccumulated Other Comprehensive Loss\tAccumulated Deficit\t\n\tShares\tAmount\tShares\tAmount\t\tTotal\nBalance at August 3 2019\t34052\t341\t425033\t(5175)\t(43546)\t(5485)\t(196520)\t179823\nNet loss\t0\t0\t0\t0\t0\t0\t(15914)\t(15914)\nOther comprehensive loss\t0\t0\t0\t0\t0\t(1081)\t0\t(1081)\nDeferred compensation\t0\t0\t898\t0\t(898)\t0\t0\t0\nIssuance of equity awards net\t24\t0\t0\t0\t0\t0\t0\t0\nTax withholdings paid for net settlement of stock awards\t0\t0\t(16)\t0\t0\t0\t0\t(16)\nStock-based compensation expense\t0\t0\t691\t0\t0\t0\t0\t691\nBalance at November 2 2019\t34076\t341\t426606\t(5175)\t(44444)\t(6566)\t(212434)\t163503\n\tCommon Stock\t\tAdditional Paid-in Capital\tTreasury Stock\t\tAccumulated Other Comprehensive Loss\tAccumulated Deficit\t\n\tShares\tAmount\tShares\tAmount\t\tTotal\nBalance at August 4 2018\t33418\t334\t421621\t(5175)\t(43388)\t(4823)\t(77909)\t295835\nNet loss\t0\t0\t0\t0\t0\t0\t(31353)\t(31353)\nOther comprehensive loss\t0\t0\t0\t0\t0\t(908)\t0\t(908)\nDividends on common stock $0.05 per share\t0\t0\t0\t0\t0\t0\t(1430)\t(1430)\nDeferred compensation\t0\t0\t139\t0\t(139)\t0\t0\t0\nIssuance of equity awards net\t40\t1\t(1)\t0\t0\t0\t0\t0\nTax withholdings paid for net settlement of stock awards\t0\t0\t(25)\t0\t0\t0\t0\t(25)\nStock-based compensation expense\t0\t0\t805\t0\t0\t0\t0\t805\nBalance at November 3 2018\t33458\t335\t422539\t(5175)\t(43527)\t(5731)\t(110692)\t262924\n", "q10k_tbl_6": "\tCommon Stock\t\tAdditional Paid-in Capital\tTreasury Stock\t\tAccumulated Other Comprehensive Loss\tAccumulated Deficit\t\n\tShares\tAmount\tShares\tAmount\t\tTotal\nBalance at February 2 2019\t33469\t335\t423535\t(5175)\t(43579)\t(5857)\t(119909)\t254525\nCumulative-effect adjustment (a)\t0\t0\t0\t0\t0\t0\t(5208)\t(5208)\nNet loss\t0\t0\t0\t0\t0\t0\t(87338)\t(87338)\nOther comprehensive loss\t0\t0\t0\t0\t0\t(709)\t0\t(709)\nDeferred compensation\t0\t0\t865\t0\t(865)\t0\t0\t0\nIssuance of equity awards net\t607\t6\t(6)\t0\t0\t0\t0\t0\nTax withholdings paid for net settlement of stock awards\t0\t0\t(64)\t0\t0\t0\t0\t(64)\nStock-based compensation expense\t0\t0\t2276\t0\t0\t0\t0\t2276\nDividends on forfeited stock awards charged to compensation expense\t0\t0\t0\t0\t0\t0\t21\t21\nBalance at November 2 2019\t34076\t341\t426606\t(5175)\t(44444)\t(6566)\t(212434)\t163503\n(a) Related to the adoption of the new lease accounting standard. See Note 1 for further disclosures regarding the adoption impact.\t\t\t\t\t\t\t\t\n\tCommon Stock\t\tAdditional Paid-in Capital\tTreasury Stock\t\tAccumulated Other Comprehensive Loss\tAccumulated Deficit\t\n\tShares\tAmount\tShares\tAmount\t\tTotal\nBalance at February 3 2018\t32806\t328\t418658\t(5175)\t(43298)\t(5177)\t(26397)\t344114\nNet loss\t0\t0\t0\t0\t0\t0\t(79953)\t(79953)\nOther comprehensive loss\t0\t0\t0\t0\t0\t(554)\t0\t(554)\nDividends on common stock $0.15 per share\t0\t0\t0\t0\t0\t0\t(4342)\t(4342)\nDeferred compensation\t0\t0\t229\t0\t(229)\t0\t0\t0\nIssuance of equity awards net\t652\t7\t(7)\t0\t0\t0\t0\t0\nTax withholdings paid for net settlement of stock awards\t0\t0\t(195)\t0\t0\t0\t0\t(195)\nStock-based compensation expense\t0\t0\t3854\t0\t0\t0\t0\t3854\nBalance at November 3 2018\t33458\t335\t422539\t(5175)\t(43527)\t(5731)\t(110692)\t262924\n", "q10k_tbl_7": "\tNovember 2 2019\t\t\t\n\tBalance\tQuoted Prices in Active Markets for Identical Instruments (Level 1)\tSignificant Other Observable Inputs (Level 2)\tSignificant Unobservable Inputs (Level 3)\nOther assets:\t\t\t\t\nSecurities held in grantor trust for deferred compensation plans (a)(b)\t15058\t15058\t0\t0\n\tFebruary 2 2019\t\t\t\n\tBalance\tQuoted Prices in Active Markets for Identical Instruments (Level 1)\tSignificant Other Observable Inputs (Level 2)\tSignificant Unobservable Inputs (Level 3)\nOther assets:\t\t\t\t\nSecurities held in grantor trust for deferred compensation plans (a)(b)\t19536\t19536\t0\t0\n\tNovember 3 2018\t\t\t\n\tBalance\tQuoted Prices in Active Markets for Identical Instruments (Level 1)\tSignificant Other Observable Inputs (Level 2)\tSignificant Unobservable Inputs (Level 3)\nOther assets:\t\t\t\t\nSecurities held in grantor trust for deferred compensation plans (a)(b)\t18969\t18969\t0\t0\n", "q10k_tbl_8": "\tNovember 2 2019\t\t\t\n\tBalance\tQuoted Prices in Active Markets for Identical Instruments (Level 1)\tSignificant Other Observable Inputs (Level 2)\tSignificant Unobservable Inputs (Level 3)\nAssets:\t\t\t\t\nStore property equipment and leasehold improvements (a)\t928\t0\t0\t928\nOperating lease assets (a)\t5419\t0\t0\t5419\nTotal assets\t6347\t0\t0\t6347\n\tFebruary 2 2019\t\t\t\n\tBalance\tQuoted Prices in Active Markets for Identical Instruments (Level 1)\tSignificant Other Observable Inputs (Level 2)\tSignificant Unobservable Inputs (Level 3)\nAssets:\t\t\t\t\nStore property equipment and leasehold improvements (a)\t1583\t0\t0\t1583\n\tNovember 3 2018\t\t\t\n\tBalance\tQuoted Prices in Active Markets for Identical Instruments (Level 1)\tSignificant Other Observable Inputs (Level 2)\tSignificant Unobservable Inputs (Level 3)\nAssets:\t\t\t\t\nStore property equipment and leasehold improvements (a)\t1106\t0\t0\t1106\n", "q10k_tbl_9": "\tNovember 2 2019\tFebruary 2 2019\tNovember 3 2018\nLand\t540\t1544\t1544\nBuildings and improvements\t10393\t12969\t12969\nFixtures and equipment\t535923\t530385\t540371\nLeasehold improvements\t413236\t413271\t411072\nProperty equipment and leasehold improvements\t960092\t958169\t965956\nLess: Accumulated depreciation\t778376\t733366\t736014\nProperty equipment and leasehold improvements net\t181716\t224803\t229942\n", "q10k_tbl_10": "\tThree Months Ended\t\tNine Months Ended\t\n\tNovember 2 2019\tNovember 3 2018\tNovember 2 2019\tNovember 3 2018\nDepreciation and amortization\t15272\t13988\t45144\t44135\nStore impairment (a)\t1466\t0\t2116\t1070\nE-commerce impairment (b)\t7889\t0\t7889\t0\nIntangible asset impairment (c)\t325\t0\t325\t0\nAirplane impairment (d)\t0\t0\t965\t0\nTotal depreciation amortization and impairment\t24952\t13988\t56439\t45205\nDepreciation amortization and impairment in cost of sales and related buying occupancy and distribution expenses\t16070\t11241\t39767\t35617\nDepreciation amortization and impairment in selling general and administrative expenses\t8882\t2747\t16672\t9588\nTotal depreciation amortization and impairment\t24952\t13988\t56439\t45205\n", "q10k_tbl_11": "\tNovember 2 2019\tFebruary 2 2019\tNovember 3 2018\nRevolving loan\t317623\t204044\t322572\nTerm loan\t47500\t50000\t25000\nFinance obligations\t0\t554\t812\nOther financing\t0\t508\t1011\nTotal debt obligations\t365123\t255106\t349395\nLess: Current portion of debt obligations\t5000\t4812\t3555\nLong-term debt obligations\t360123\t250294\t345840\n", "q10k_tbl_12": "\tThree Months Ended\t\t\t\t\t\n\tNovember 2 2019\t\t\tNovember 3 2018\t\t\nMerchandise Category\tDepartment Stores\tOff-price Stores\tTotal Company\tDepartment Stores\tOff-price Stores\tTotal Company\nWomen's\t100929\t27834\t128763\t94732\t19934\t114666\nMen's\t48849\t13287\t62136\t43954\t11230\t55184\nChildren's\t34779\t13130\t47909\t29682\t10635\t40317\nApparel\t184557\t54251\t238808\t168368\t41799\t210167\nFootwear\t40650\t6096\t46746\t44400\t4594\t48994\nAccessories\t18830\t4281\t23111\t17823\t4863\t22686\nCosmetics/Fragrances\t24071\t3051\t27122\t27822\t2620\t30442\nHome/Gifts\t34663\t23955\t58618\t15972\t17918\t33890\nOther\t4242\t717\t4959\t693\t156\t849\nNon-apparel\t122456\t38100\t160556\t106710\t30151\t136861\nRevenue adjustments not allocated (a)\t(6)\t(56)\t(62)\t183\t(111)\t72\nNet sales\t307007\t92295\t399302\t275261\t71839\t347100\n(a) Includes adjustments related to deferred revenue estimated sales returns breakage income shipping and miscellaneous revenues which are not allocated to merchandise categories.\t\t\t\t\t\t\n", "q10k_tbl_13": "\tNine Months Ended\t\t\t\t\t\n\tNovember 2 2019\t\t\tNovember 3 2018\t\t\nMerchandise Category\tDepartment Stores\tOff-price Stores\tTotal Company\tDepartment Stores\tOff-price Stores\tTotal Company\nWomen's\t285183\t73649\t358832\t315428\t59165\t374593\nMen's\t137539\t33335\t170874\t138414\t27688\t166102\nChildren's\t85115\t32880\t117995\t88160\t26261\t114421\nApparel\t507837\t139864\t647701\t542002\t113114\t655116\nFootwear\t120148\t17267\t137415\t134024\t13918\t147942\nAccessories\t53532\t12490\t66022\t55121\t13118\t68239\nCosmetics/Fragrances\t79128\t8720\t87848\t90295\t7530\t97825\nHome/Gifts\t80528\t64516\t145044\t35766\t51740\t87506\nOther\t11929\t2220\t14149\t5697\t1587\t7284\nNon-apparel\t345265\t105213\t450478\t320903\t87893\t408796\nRevenue adjustments not allocated (a)\t(2265)\t(1026)\t(3291)\t(2986)\t(303)\t(3289)\nNet sales\t850837\t244051\t1094888\t859919\t200704\t1060623\n(a) Includes adjustments related to deferred revenue estimated sales returns breakage income shipping and miscellaneous revenues which are not allocated to merchandise categories.\t\t\t\t\t\t\n", "q10k_tbl_14": "\tNovember 2 2019\tFebruary 2 2019\tNovember 3 2018\nGift cards and merchandise credits net\t8835\t12433\t9756\nLoyalty program rewards net\t6065\t1484\t5540\nMerchandise fulfillment liability\t657\t488\t1180\nTotal contract liabilities\t15557\t14405\t16476\n", "q10k_tbl_15": "\tThree Months Ended\t\tNine Months Ended\t\n\tNovember 2 2019\tNovember 3 2018\tNovember 2 2019\tNovember 3 2018\nBeginning balance\t15765\t15119\t14405\t13474\nNet sales recognized during the period from amounts included in contract liability balances at the beginning of the period\t(7209)\t(6574)\t(7775)\t(7396)\nCurrent period additions to contract liability balances included in contract liability balances at the end of the period\t7001\t7931\t8927\t10398\nEnding balance\t15557\t16476\t15557\t16476\n", "q10k_tbl_16": "\tThree Months Ended\t\tNine Months Ended\t\n\tNovember 2 2019\tNovember 3 2018\tNovember 2 2019\tNovember 3 2018\nUpfront payments recognized in credit income\t469\t438\t1344\t1313\n", "q10k_tbl_17": "\tThree Months Ended\tNine Months Ended\n\tNovember 2 2019\tNovember 2 2019\nOperating lease cost\t26448\t78905\nVariable lease cost\t9676\t29117\nShort-term lease cost\t152\t176\nSublease income\t(553)\t(1290)\nTotal net lease cost\t35723\t106908\nNet lease cost in cost of sales and related buying occupancy and distribution expenses\t34712\t103588\nNet lease cost in selling general and administrative expenses\t1011\t3320\nTotal net lease cost\t35723\t106908\n", "q10k_tbl_18": "Fiscal Year\tOperating Leases\tSublease\n2019 (remainder of year)\t27459\t(424)\n2020\t105350\t(1739)\n2021\t90889\t(1829)\n2022\t74893\t(1829)\n2023\t54382\t(1184)\n2024\t36359\t0\nThereafter\t68584\t0\nTotal lease payments\t457916\t(7005)\nLess: Effects of discounting\t106603\t\nPresent value of lease liabilities\t351313\t\nLess: Current portion of lease liabilities\t75709\t\nLong-term lease liabilities\t275604\t\n", "q10k_tbl_19": "Fiscal Year\tCommitments\tSublease Income\tNet Minimum Lease Commitments\n2019\t108541\t(1447)\t107094\n2020\t98859\t(1492)\t97367\n2021\t83377\t(1582)\t81795\n2022\t67447\t(1582)\t65865\n2023\t46887\t(1054)\t45833\nThereafter\t77910\t0\t77910\nTotal\t483021\t(7157)\t475864\n", "q10k_tbl_20": "\tThree Months Ended\t\tNine Months Ended\t\n\tNovember 2 2019\tNovember 3 2018\tNovember 2 2019\tNovember 3 2018\nNon-vested stock\t505\t887\t1801\t3153\nRestricted stock units\t807\t196\t1053\t947\nStock-settled performance share units\t186\t(82)\t475\t701\nCash-settled performance share units\t913\t11\t941\t161\nTotal stock-based compensation expense\t2411\t1012\t4270\t4962\nRelated tax benefit\t0\t0\t0\t0\nStock-based compensation expense net of tax\t2411\t1012\t4270\t4962\n", "q10k_tbl_21": "Non-vested Stock\tNumber of Shares\tWeighted Average Grant Date Fair Value\nOutstanding at February 2 2019\t1379616\t4.43\nGranted\t1004670\t0.94\nVested\t(663427)\t5.40\nForfeited\t(40974)\t6.87\nOutstanding at November 2 2019\t1679885\t1.90\n", "q10k_tbl_22": "Restricted Stock Units\tNumber of Units\tWeighted Average Grant Date Fair Value\nOutstanding at February 2 2019\t1740314\t2.16\nGranted\t1615000\t0.98\nVested\t(492814)\t2.16\nForfeited\t(613125)\t1.59\nOutstanding at November 2 2019\t2249375\t1.47\n", "q10k_tbl_23": "Period Granted\tTarget PSUs Outstanding at February 2 2019\tTarget PSUs Granted\tTarget PSUs Forfeited\tTarget PSUs Outstanding at November 2 2019\tWeighted Average Grant Date Fair Value per Target PSU\n2017\t470000\t0\t(50000)\t420000\t1.80\n2018\t280000\t0\t0\t280000\t3.05\n2019\t0\t375000\t0\t375000\t1.39\nTotal\t750000\t375000\t(50000)\t1075000\t1.98\n", "q10k_tbl_24": "Period Granted\tTarget PSUs Outstanding at February 2 2019\tTarget PSUs Granted\tTarget PSUs Forfeited\tTarget PSUs Outstanding at November 2 2019\tWeighted Average Grant Date Fair Value per Target PSU\n2018\t300000\t0\t(50000)\t250000\t3.05\n2019\t0\t530000\t(50000)\t480000\t1.39\nTotal\t300000\t530000\t(100000)\t730000\t1.96\n", "q10k_tbl_25": "\tThree Months Ended\t\tNine Months Ended\t\n\tNovember 2 2019\tNovember 3 2018\tNovember 2 2019\tNovember 3 2018\nEmployer service cost\t135\t127\t405\t383\nInterest cost on pension benefit obligation\t321\t338\t965\t1013\nExpected return on plan assets\t(363)\t(435)\t(1090)\t(1305)\nAmortization of net loss\t186\t85\t558\t439\nSettlement charges (a)\t270\t411\t270\t411\nNet periodic pension cost\t549\t526\t1108\t941\n(a) Non-cash pension settlement charges were recognized as a result of lump sum distributions exceeding interest cost for the nine months ended November 2 2019 and November 3 2018 respectively.\t\t\t\t\n", "q10k_tbl_26": "\tThree Months Ended\t\tNine Months Ended\t\n\tNovember 2 2019\tNovember 3 2018\tNovember 2 2019\tNovember 3 2018\nAmortization of net loss\t(186)\t(85)\t(558)\t(439)\nSettlement charges\t(270)\t(411)\t(270)\t(411)\nNet loss\t1537\t1404\t1537\t1404\nNet change recognized in other comprehensive loss pre-tax\t1081\t908\t709\t554\n", "q10k_tbl_27": "\tThree Months Ended\t\tNine Months Ended\t\n\tNovember 2 2019\tNovember 3 2018\tNovember 2 2019\tNovember 3 2018\nLoss (gain) from decrease (increase) in discount rate\t3818\t(2521)\t3818\t(2521)\n(Gain) loss from investment return on plan assets\t(1803)\t3365\t(1803)\t3365\n(Gain) loss due to updated demographic data and assumption changes (other than discount rate)\t(478)\t560\t(478)\t560\nNet loss\t1537\t1404\t1537\t1404\n", "q10k_tbl_28": "\tThree Months Ended\t\tNine Months Ended\t\n\tNovember 2 2019\tNovember 3 2018\tNovember 2 2019\tNovember 3 2018\nBasic:\t\t\t\t\nNet loss\t(15914)\t(31353)\t(87338)\t(79953)\nDistributed earnings allocated to participating securities\t0\t(18)\t0\t(149)\nNet loss allocated to common shares\t(15914)\t(31371)\t(87338)\t(80102)\nBasic weighted average shares outstanding\t28886\t28261\t28706\t28059\nBasic loss per share\t(0.55)\t(1.11)\t(3.04)\t(2.85)\n\tThree Months Ended\t\tNine Months Ended\t\n\tNovember 2 2019\tNovember 3 2018\tNovember 2 2019\tNovember 3 2018\nDiluted:\t\t\t\t\nNet loss\t(15914)\t(31353)\t(87338)\t(79953)\nDistributed earnings allocated to participating securities\t0\t(18)\t0\t(149)\nNet loss allocated to common shares\t(15914)\t(31371)\t(87338)\t(80102)\nBasic weighted average shares outstanding\t28886\t28261\t28706\t28059\nDilutive effect of stock awards\t0\t0\t0\t0\nDiluted weighted average shares outstanding\t28886\t28261\t28706\t28059\nDiluted loss per share\t(0.55)\t(1.11)\t(3.04)\t(2.85)\n", "q10k_tbl_29": "\tThree Months Ended\t\tNine Months Ended\t\n\tNovember 2 2019\tNovember 3 2018\tNovember 2 2019\tNovember 3 2018\nNumber of anti-dilutive shares due to net loss for the period\t1120\t89\t373\t341\n", "q10k_tbl_30": "\tNovember 2 2019\tNovember 3 2018\nDepartment stores\t617\t754\nOff-price stores\t158\t68\nTotal stores\t775\t822\n", "q10k_tbl_31": "\tThree Months Ended\t\tNine Months Ended\t\n\tNovember 2 2019\tNovember 3 2018\tNovember 2 2019\tNovember 3 2018\nNet loss (GAAP)\t(15914)\t(31353)\t(87338)\t(79953)\nInterest expense\t4070\t3350\t12187\t8253\nIncome tax expense\t150\t(12)\t450\t288\nDepreciation and amortization\t15272\t13988\t45144\t44135\nImpairment of long-lived assets\t9680\t0\t11295\t1070\nSeverance\t425\t819\t2928\t938\nPre-opening expenses (a)\t560\t0\t3457\t0\nStore closing services\t1038\t0\t2216\t0\nAdjusted EBITDA (non-GAAP)\t15281\t(13208)\t(9661)\t(25269)\nNet loss (GAAP)\t(15914)\t(31353)\t(87338)\t(79953)\nImpairment of long-lived assets\t9680\t0\t11295\t1070\nSeverance\t425\t819\t2928\t938\nPre-opening expenses (a)\t560\t0\t3457\t0\nStore closing services\t1038\t0\t2216\t0\nAdjusted net loss (non-GAAP)\t(4211)\t(30534)\t(67442)\t(77945)\nDiluted loss per share (GAAP)\t(0.55)\t(1.11)\t(3.04)\t(2.85)\nImpairment of long-lived assets\t0.34\t0\t0.39\t0.04\nSeverance\t0.01\t0.03\t0.10\t0.03\nPre-opening expenses (a)\t0.02\t0\t0.12\t0\nStore closing services\t0.04\t0\t0.08\t0\nAdjusted diluted loss per share (non-GAAP) (b)\t(0.15)\t(1.08)\t(2.35)\t(2.78)\n(a) Pre-opening expenses include store payroll marketing expenses meals and travel expenses and supplies.\t\t\t\t\n(b) Per share amounts may not foot due to rounding.\t\t\t\t\n", "q10k_tbl_32": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tNovember 2 2019\tNovember 3 2018\tChange\tNovember 2 2019\tNovember 3 2018\tChange\nNet sales\t399302\t347100\t52202\t1094888\t1060623\t34265\nSales percent change:\t\t\t\t\t\t\nTotal net sales\t\t\t15.0%\t\t\t3.2%\nComparable sales\t\t\t17.4%\t\t\t5.3%\n", "q10k_tbl_33": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tNovember 2 2019\tNovember 3 2018\tChange\tNovember 2 2019\tNovember 3 2018\tChange\nCredit income\t15678\t13324\t2354\t42774\t43143\t(369)\nAs a percent of net sales\t3.9%\t3.8%\t0.1%\t3.9%\t4.1%\t(0.2)%\n", "q10k_tbl_34": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tNovember 2 2019\tNovember 3 2018\tChange\tNovember 2 2019\tNovember 3 2018\tChange\nNet sales\t399302\t347100\t52202\t1094888\t1060623\t34265\nCost of sales and related buying occupancy and distribution expenses\t315494\t278665\t36829\t888297\t847213\t41084\nGross profit\t83808\t68435\t15373\t206591\t213410\t(6819)\nAs a percent of net sales\t21.0%\t19.7%\t1.3%\t18.9%\t20.1%\t(1.2)%\n", "q10k_tbl_35": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tNovember 2 2019\tNovember 3 2018\tChange\tNovember 2 2019\tNovember 3 2018\tChange\nSG&A expenses\t111180\t109774\t1406\t324066\t327965\t(3899)\nAs a percent of net sales\t27.8%\t31.6%\t(3.8)%\t29.6%\t30.9%\t(1.3)%\n", "q10k_tbl_36": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tNovember 2 2019\tNovember 3 2018\tChange\tNovember 2 2019\tNovember 3 2018\tChange\nInterest expense\t4070\t3350\t720\t12187\t8253\t3934\nAs a percent of net sales\t1.0%\t1.0%\t-%\t1.1%\t0.8%\t0.3%\n", "q10k_tbl_37": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tNovember 2 2019\tNovember 3 2018\tChange\tNovember 2 2019\tNovember 3 2018\tChange\nIncome tax expense (benefit)\t150\t(12)\t162\t450\t288\t162\nEffective tax rate\t(1.0)%\t-%\t(1.0)%\t(0.5)%\t(0.4)%\t(0.1)%\n", "q10k_tbl_38": "\tThree Months Ended\t\t\tNine Months Ended\t\t\n\tNovember 2 2019\tNovember 3 2018\tChange\tNovember 2 2019\tNovember 3 2018\tChange\nLoss before income tax\t(15764)\t(31365)\t15601\t(86888)\t(79665)\t(7223)\nNet loss\t(15914)\t(31353)\t15439\t(87338)\t(79953)\t(7385)\n", "q10k_tbl_39": "\tNine Months Ended\t\t\n\tNovember 2 2019\tNovember 3 2018\tChange\nNet cash (used in) provided by:\t\t\t\nOperating activities\t(76910)\t(136917)\t60007\nInvesting activities\t(22258)\t(19444)\t(2814)\nFinancing activities\t109606\t160936\t(51330)\n", "q10k_tbl_40": "ISSUER PURCHASES OF EQUITY SECURITIES\t\t\t\t\nPeriod\tTotal Number of Shares Purchased (a)\tAverage Price Paid Per Share (a)\tTotal Number of Shares Purchased as Part of Publicly Announced Plans or Programs\tApproximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (b)\nAugust 4 2019 to August 31 2019\t19619\t0.72\t0\t58351202\nSeptember 1 2019 to October 5 2019\t649120\t1.37\t0\t58351202\nOctober 6 2019 to November 2 2019\t5478\t2.18\t0\t58351202\nTotal\t674217\t1.36\t0\t\n", "q10k_tbl_41": "Exhibit Number\tDescription\n31.1*\tCertification of Chief Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934 as amended as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.\n31.2*\tCertification of Chief Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934 as amended as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.\n32*\tCertification Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.\n101.INS\tInline XBRL Instance Document - the instance document does not appear in Interactive Data File because its XBRL tags are embedded within the Inline XBRL document\n101.SCH\tInline XBRL Taxonomy Extension Schema Document\n101.CAL\tInline XBRL Taxonomy Extension Calculation Linkbase Document\n101.DEF\tInline XBRL Taxonomy Extension Definition Linkbase Document\n101.LAB\tInline XBRL Taxonomy Extension Label Linkbase Document\n101.PRE\tInline XBRL Taxonomy Extension Presentation Linkbase Document\n104\tCover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)\n"}{"bs": "q10k_tbl_2", "is": "q10k_tbl_3", "cf": "q10k_tbl_4"}None
Note 3 - Property, Equipment and Leasehold Improvements
Note 4 - Debt Obligations
Note 5 - Revenue
Note 6 - Leases
Note 7 - Stock - Based Compensation
Note 8 - Pension Plan
Note 9 - Earnings per Share
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II - Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
Exhibits
EX-31.1
ex311q32019.htm
EX-31.2
ex312q32019.htm
EX-32
ex32q32019.htm
Stage Stores Earnings 2019-11-02
Balance Sheet
Income Statement
Cash Flow
Assets, Equity
Rev, G Profit, Net Income
Ops, Inv, Fin
Document
false--02-01Q32019truefalse0000006885falseAccelerated Filer0.01falsetrue579-2302 22P7D0.050.150.010.010.011000000001000000001000000003345800033469000340760002021-12-16P91DP273DP364DP91DP273DP371DP364DP364D400000Our lease agreements include leases for our retail stores, distribution centers and corporate headquarters. As of November 2, 2019, all of our leases were classified as operating leases. Our store leases typically have an initial term of 10 years and often have two renewal options of five years each. The exercise of a lease renewal option is at our sole discretion. The lease term includes the initial contractual term as well as any options to extend the lease when it is reasonably certain that we will exercise that option. Our lease agreements do not contain any residual value guarantees or material restrictive covenants. The majority of our leases include fixed rent payments. A number of store leases provide for escalating minimum rent payments at pre-determined dates. Certain store leases provide for contingent rent payments based on a percentage of retail sales over contractual levels. Some of our leases include variable payments for maintenance, taxes and insurance.24000005500000Settles in cash ranging from zero to a maximum of twice the number of target units awarded multiplied by the fair market value of one share of our common stock on the vesting date.Converts to common stock (unless otherwise determined by our Board of Directors, or its Compensation Committee) ranging from zero to a maximum of twice the number of granted shares outstanding on the vesting date.517500051750005175000Non-cash pension settlement charges were recognized as a result of lump sum distributions exceeding interest cost for the nine months ended November 2, 2019 and November 3, 2018, respectively.Includes adjustments related to deferred revenue, estimated sales returns, breakage income, shipping and miscellaneous revenues, which are not allocated to merchandise categories.Related to the adoption of the new lease accounting standard. See Note 1 for further disclosures regarding the adoption 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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One)
☑
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended November 2, 2019
or
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______ to ______
Commission File Number 1-14035
Stage Stores, Inc.
(Exact name of registrant as specified in its charter)
Nevada
91-1826900
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
2425 West Loop South
77027
Houston,
Texas
(Zip Code)
(Address of principal executive offices)
(800)579-2302
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading
Symbol(s)
Name of each exchange on which registered
Common Stock ($0.01 par value)
SSI
New York Stock Exchange
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes☑ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes☑No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer
☐
Accelerated filer
☑
Non-accelerated filer
☐
Smaller reporting company
☑
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑
As of December 4, 2019, there were 28,911,336 shares of the registrant’s common stock outstanding.
Notes to Condensed Consolidated Financial Statements
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
The accompanying condensed consolidated financial statements of Stage Stores, Inc. and its subsidiary (“we,” “us” or “our”) have been prepared in accordance with the requirements of the U.S. Securities and Exchange Commission (“SEC”) for interim financial information and do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements. Those adjustments that are, in the opinion of management, necessary for a fair presentation of the results of the interim periods have been made. Results of operations for such interim periods are not necessarily indicative of the results of operations for a full year due to seasonality and other factors. The condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto filed with our Annual Report on Form 10-K for the year ended February 2, 2019 (“Form 10-K”).
We are a retailer of trend-right, moderately priced, name-brand apparel, accessories, cosmetics, footwear and home goods. As of November 2, 2019, we operated in 42 states through 617 BEALLS, GOODY’S, PALAIS ROYAL, PEEBLES and STAGE department stores and 158 GORDMANS off-price stores, as well as an e-commerce website (www.stage.com). Our department stores are predominantly located in small towns and rural communities. Our off-price stores are predominantly located in smaller and mid-sized markets in the Midwest. In September 2019, we announced our plan to convert substantially all of our department stores to off-price beginning in February 2020. By the end of the third quarter of fiscal year 2020, we expect to be operating approximately 700 predominantly small-market, Gordmans stores, offering off-price values and broad assortments of name-brand merchandise in a fun, scarcity driven, treasure hunt experience.
References to a particular year are to our fiscal year, which is the 52- or 53-week period ending on the Saturday closest to January 31st of the following calendar year. For example, a reference to “2019” is a reference to the fiscal year ending February 1, 2020, and “2018” is a reference to the fiscal year ended February 2, 2019. Fiscal years 2019 and 2018 are comprised of 52 weeks. References to the “three months ended November 2, 2019” and “three months ended November 3, 2018” are for the respective 13-week fiscal quarters. References to quarters relate to our fiscal quarters. References to the “nine months ended November 2, 2019” and “nine months ended November 3, 2018” are for the respective 39-week fiscal periods.
Recently Adopted Accounting Pronouncements. In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Updates (“ASU”) 2016-02, Leases (Topic 842), and subsequently issued related ASUs, which were incorporated into Topic 842.Under the new standard, lessees are required to recognize a right-of-use asset and a lease liability, measured on a discounted basis, at the later of the lease commencement date and the date of adoption. The guidance also requires qualitative and quantitative disclosures about the amount, timing and uncertainty of cash flows arising from leases. We adopted the new standard on February 3, 2019, the first day of fiscal 2019.
Transition elections:
•
We elected to apply the effective date transition method as of the February 3, 2019 adoption date. Comparative periods prior to the adoption of the new standard have not been restated and are reported under the legacy guidance in Accounting Standards Codification (“ASC”) Topic 840, Leases.
•
We elected the package of practical expedients in the transition guidance, which permits us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs.
•
We elected not to use the practical expedient of using hindsight to determine the lease term and in assessing impairment of the right-of-use assets.
We elected the short-term lease exemption for leases that have a lease term of twelve months or less. For leases that qualify for the short-term exemption, we will not recognize a right-of-use asset or liability and will recognize those lease expenses on a straight-line basis over the lease term.
•
We elected to not separate lease and non-lease components for all of our current lease classes.
The adoption of the standard resulted in the recognition of operating lease assets and liabilities of $344.2 million and $375.8 million, respectively, as of February 3, 2019. Included in the measurement of the operating lease assets and liabilities is the reclassification of balances historically recorded as deferred rent and deferred rent tenant allowances. We also recognized a cumulative effect charge of $5.2 million, net of tax, to the opening accumulated deficit balance. This adjustment reflects $5.8 million in depreciation of leasehold improvements associated with conforming the asset useful life to the remaining lease life as of the transition date. It also reflects $0.6 million associated with the derecognition of lease obligations that had been classified as finance obligations under the former failed sale-leaseback guidance applied to build-to-suit arrangements. Under the new standard, these leases are classified as operating leases. The adoption of the standard did not have a material impact on our results of operations or cash flows. In addition, our bank covenants under our Credit Facility were not affected by the adoption of the standard. See Note 6 for further disclosures regarding leases.
Recent Accounting Pronouncements Not Yet Adopted. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement, which eliminates, adds and modifies certain disclosure requirements for fair value measurements. The new standard will be effective for us in the first quarter of fiscal 2020, with early adoption permitted. The provisions of ASU 2018-13 applicable to us should be applied prospectively. We expect ASU 2018-13 to impact our disclosures by eliminating the disclosure of valuation processes for Level 3 fair value measurements, and adding disclosure of quantitative information, such as the range and weighted average, of significant unobservable inputs used to develop Level 3 fair value measurements.
In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (a consensus of the FASB Emerging Issues Task Force), which aligns the requirements for capitalizing implementation costs in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The guidance also requires disclosure of the nature of hosting arrangements that are service contracts. The new standard will be effective for us in the first quarter of fiscal 2020, with early adoption permitted. Upon adoption, we plan to apply the provisions of ASU 2018-15 prospectively. We expect the adoption to result in the recognition of prepaid expenses or other non-current assets that will be expensed over the contract term, whereas prior to adoption, these costs are recognized as long-lived assets and depreciated over the assets’ useful life. We do not expect the adoption to have a material impact on our financial condition, results of operations or cash flows.
We recognize or disclose the fair value of our financial and non-financial assets and liabilities on a recurring and non-recurring basis. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities which are required to be recorded at fair value, we assume the highest and best use of the asset by market participants in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability.
We applied the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels, and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:
Level 1 –
Quoted prices in active markets for identical assets or liabilities.
Level 2 –
Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3 –
Inputs that are both unobservable and significant to the overall fair value measurement reflect our estimates of assumptions that market participants would use in pricing the asset or liability.