The ICR Conference in Orlando, FL, gave brands across the consumer and retail industries a chance to present their current financial profile and plans for 2019 and beyond.
In a note to investors summarizing the event, KeyBanc Capital Markets consumer team wrote, “Clouds are forming in the consumer outlook. Tone from companies was not downbeat, per se, but holiday was more challenging than expected. The holiday calendar was the most often cited source of weakness, and market share shifts continue. E-commerce remains a very important growth lever.”
SGB capsuled brands of interest for our readers, including their updated guidance and share value before and after the conference, plus analyst reaction where applicable. Click the company name to read more of its pre-ICR news about updating guidance or releasing preliminary sales results:
Boot Barn Holdings Inc.
The 411 – Boot Barn announced preliminary results for the third quarter of fiscal year 2019 ended December 29 that showed both earnings and sales came in well above projections. Same store sales increased approximately 9.2 percent. Net income per diluted share of approximately 66 cents a share based on 28.9 million weighted average diluted shares outstanding. Previously, Boot Barn had expected same store sales growth of 5 percent to 7 percent and EPS in the range of 56 to 60 cents.
Investor reaction – The company’s shares at Thursday’s market close were $22.05, up from last Friday’s close of $19.39.
The 411 – After Crocs announced preliminary 2018 sales growth of 6 percent, the company is focused on moving past repositioning efforts and into growth mode for 2019 and beyond. A three-pronged approach of product, channel and region has the company looking to take share across categories and geographies.
Investor reaction – The company’s shares at Thursday’s market close were $30.69, down slightly from last Friday’s close of $30.96.
Analyst reaction – “With top-line accelerating over the course of 2018 (ending on a strong note), investors primarily are focused on sustainability. We are more optimistic about the pipeline of initiatives into 2019, though we wait for pullbacks or signs that revenue over-delivery can continue before becoming more constructive following the sharp run up.”
–Jonathan Komp, Baird
Take a deeper dive: Click here to read SGB’s summary of Crocs’ ICR presentation
Delta Apparel Inc.
The 411 – The company said it anticipates overall net sales for the first quarter of its 2019 fiscal year to come in ahead of expectations at approximately $101 million, or about a 12 percent increase from prior year net sales of $90.3 million, driven by strength in its Salt Life business. Delta Apparel expects adjusted earnings per share for the quarter to be approximately in line with prior year adjusted results of 8 cents after excluding the financial impact of this expense and the impact of United States tax reform legislation.
Investor reaction – The company’s shares at Thursday’s market close were $20, up from last Friday’s close of $18.46.
Analyst reaction – “DLA’s T-shirt printing business is helping small screen printing shops provide more customized offerings at a profitable margin. Salt Life is becoming a larger lifestyle brand and its restaurant concept is growing (slowly).”
–KeyBanc Capital Markets
The 411 – Genesco reported fourth quarter same-store sales increased 4 percent while reiterating its most recent EPS guidance. Same store sales increased 3 percent and sales for the company’s e-commerce businesses increased 8 percent on a comparable basis for that period. The company continues to expect adjusted earnings per diluted share for the fiscal year ending February 2 in the range of $3.10 to $3.40, viewing results near the middle of the range as most likely.
Investor reaction – The company’s shares at Thursday’s market close were $48.25, up from last Friday’s close of $47.47.
Analyst reaction – “At Journeys, Vans continues to perform well in all of its silhouettes. Johnson & Murphy’s transition into rubber and sneaker-like soles has driven strong results. When factoring in expected stock buybacks from funds from the sale of Lids, the sale is expected to be +DD (double-digit) accretive.”
–KeyBanc Capital Markets
Lululemon Athletica Inc.
The 411 – For the fourth quarter of fiscal 2018, Lululemon raised its revenue guidance to $1.140 billion to $1.150 billion (up from $1.115 billion to $1.125 billion) and its diluted earnings per share guidance to $1.72 to $1.74 (up from $1.64 to $1.67).
Investor reaction – The company’s shares at Thursday’s market close were $145.14, up from last Friday’s close of $132.16.
Analyst reaction – “LULU defining the prototype omni-channel model to which consumer brands should aspire. We see potential for upside to 2019 consensus estimates and the 2020 objective of $4bn in revenue and implied earnings power of $5/share looks to be a low hurdle. Against stiffening compares, comp deceleration is inevitable but behind a strengthening ecommerce business, we expect double digit revenue growth can continue and expect a premium multiple will hold.”
–Jim Duffy, Stifel
Shoe Carnival Inc.
The 411 – Shoe Carnival now expects fiscal 2018 net sales to be approximately $1.028 billion and expects comparable store sales to increase approximately 4 percent. Earnings per diluted share for fiscal 2018 are expected to be in the range of $2.41 to $2.43. In fiscal 2017, net sales were $1.019 billion, comparable store sales increased 0.3 percent and the company earned $1.15 per diluted share. Adjusted earnings per diluted share for fiscal 2017 were $1.49.
Investor reaction – The company’s shares at Thursday’s market close were $41.14, up from last Friday’s close of $37.93.
Analyst reaction – “The company raised FY18 revenue and EPS guidance, ahead of ICR, furthering cementing our belief that SCVL’s improved customer engagement and merchandising are bearing fruit. SCVL’s continues to roll-out a new CRM which is resulting in more targeted customer communications and more relevant assortments.”
–Sam Poser, Susquehanna Financial Group LLLP
The 411 – Tilly’s said earnings per diluted share for the fiscal 2018 fourth quarter ending February 2 should be approximately 24 cents to 26 cents per diluted share, within the upper half of its original earnings outlook range of 22 cents to 26 cents per diluted share.
Investor reaction – The company’s shares at Thursday’s market close were $11.98, up from last Friday’s close of $11.87.
Analyst reaction – “Management thinks Vans growth should continue and Nike footwear business should improve given changes in management at NKE. During holiday, TLYS saw positive traffic and AOV, but conversion was down. E-commerce should be ~14 percent of 2018 sales. TLYS thinks the consumer remains in a good position and is not bringing in inventory early to potentially combat tariff risk as it has not heard of anything happening in apparel.”
–KeyBanc Capital Markets
The 411 – Unifi reiterated its top-line guidance for the year and adjusted its outlook for fiscal 2019 operating income and adjusted EBITDA. For the second quarter of fiscal 2019, the company expects net sales of approximately $167 million; gross margins of approximately 8.4 percent; operating loss between ($1.5) million and ($0.5) million; loss before income taxes between ($1.5) million and ($0.5) million; and adjusted EBITDA between $4.5 million and $5.5 million.
Investor reaction – The company’s shares at Thursday’s market close were $21.08, down from last Friday’s close of $24.90.
Yeti Holdings Inc.
The 411 – Yeti updated its Fiscal 2018 outlook with net income per diluted share now expected to be 67 cents to 69 cents (versus the previous outlook of 60 cents to 64 cents) and adjusted net income per diluted share now expected to be 88 cents to 90 cents (versus the previous outlook of 79 cents to 82 cents). Adjusted EBITDA is now expected to be $147 million to $149 million (versus the previous outlook of $141 million to $144 million), as compared to $97.5 million last year, representing an increase of 51 percent and 52 percent, respectively.
Investor reaction – The company’s shares at Thursday’s market close were $18.09, up from last Friday’s close of $16.72.
Analyst reaction – “With continued innovation, new product introduction and marketing reach into new recreational categories, we expect Yeti to expand its addressable consumer audience and range of use cases for the brand. We believe Yeti can achieve a 15 percent three-year revenue CAGR to approach $1 billion in revenue in 2020, with 20 percent EBITDA margins, positive cash flow and ROIC in the high-20 percent range. While tariff risk and insider ownership are an overhang on shares near term, we believe long-term investors will be rewarded by both earnings growth and multiple expansion.”
–Jim Duffy, Stifel
Take a deeper dive: Click here to read SGB’s summary of Yeti’s ICR presentation
Photo courtesy Lululemon Athletica Inc.