Company Performance - Container Store Group (TCS) reported a quarterly loss of $3.23 per share, significantly worse than the Zacks Consensus Estimate of a loss of $0.05, and compared to earnings of $0.15 per share a year ago, indicating a substantial decline in performance [1] - The company posted revenues of $196.58 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 0.56% and down from $219.73 million in the same quarter last year [2] - Over the last four quarters, Container Store has surpassed consensus EPS estimates two times and topped consensus revenue estimates two times [2] Stock Performance - Container Store shares have lost approximately 72% since the beginning of the year, contrasting with the S&P 500's gain of 22.1% [3] - The current consensus EPS estimate for the upcoming quarter is -$1.50 on revenues of $192.51 million, and for the current fiscal year, it is -$6.36 on revenues of $765.51 million [7] Earnings Outlook - The estimate revisions trend for Container Store is currently unfavorable, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] - The sustainability of the stock's immediate price movement will largely depend on management's commentary during the earnings call [3][4] Industry Context - The Consumer Products - Discretionary industry, to which Container Store belongs, is currently ranked in the bottom 36% of over 250 Zacks industries, suggesting a challenging environment for the company [8]

ש The Container Store® Q2 Fiscal Year 2024 Earnings Presentation NYSE: TCS OCTOBER 29, 2024 Forward-Looking Statements This presentation contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 . All statements contained in this presentation that do not relate to matters of historical fact should be considered forward looking statements, including statements regarding our future opportunities and expectations for our business, marketing initiatives and b ...

Container Store Group (TCS) is expected to deliver a year-over-year decline in earnings on lower revenues when it reports results for the quarter ended September 2024. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price.The earnings report, which is expected to be released on October 29, 2024, might help the stock move higher if these key numbers are be ...

Container Store Group (TCS) came out with a quarterly loss of $0.26 per share versus the Zacks Consensus Estimate of a loss of $0.18. This compares to loss of $0.21 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -44.44%. A quarter ago, it was expected that this storage products retailer would post a loss of $0.08 per share when it actually produced a loss of $0.04, delivering a surprise of 50%. Over the last four quarters, t ...

The Container Store (NYSE:TCS) stock jumped more than 80% Thursday on seemingly no news. In fact, investors may be confusing the ticker for The Container Store — "TCS" — with Tata Consultancy Services, which recently held a teen summer camp on the use of generative artificial intelligence (AI). Well, maybe. The summer camp itself is quite interesting, as Tata invited about 70 students between 11 and 17 to attend the Technology Learning Pathway at its Global Delivery Center in Milford, Ohio. At the event, pa ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K (Mark One) þ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended March 30, 2024 or o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to (Addresses of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (972) 538-6000 Securities registered pu ...

The Container Store Group, Inc. (NYSE:TCS) Q4 2023 Earnings Call Transcript May 14, 2024 8:00 AM ET Company Participants Caitlin Churchill - IR Satish Malhotra - CEO Jeff Miller - CFO Conference Call Participants Christopher Horvers - JP Morgan Kate McShane - Goldman Sachs Operator Greetings. Welcome to Container Store's Fourth Quarter of Full Year Fiscal 2023 Earnings Call. At this time all participants are in listen only mode. A question-and-answer session will follow the formal presentation. [Operator In ...

[Financial Results Overview](index=1&type=section&id=The%20Container%20Store%20Group%2C%20Inc.%20Announces%20Fourth%20Quarter%20and%20Full%20Fiscal%20Year%202023%20Financial%20Results) Fiscal 2023 saw significant sales and adjusted earnings declines, with cost discipline yielding positive free cash flow and a strategic focus on Custom Spaces [Financial Highlights](index=1&type=section&id=Financial%20Highlights) Fiscal 2023 saw significant sales and adjusted earnings declines, with an accelerated downturn in Q4 Fiscal Year 2023 vs. Fiscal Year 2022 Performance | Metric | Fiscal 2023 | Fiscal 2022 | Change | | :--- | :--- | :--- | :--- | | Consolidated Net Sales | $847.8M | - | Down 19.0% | | Comparable Store Sales | - | - | Down 19.7% | | Net Loss per Diluted Share | ($2.09) | ($3.21) | Improved | | Adjusted Net (Loss)/Income per Diluted Share | ($0.32) | $0.75 | Declined | Q4 Fiscal 2023 vs. Q4 Fiscal 2022 Performance | Metric | Q4 Fiscal 2023 | Q4 Fiscal 2022 | Change | | :--- | :--- | :--- | :--- | | Consolidated Net Sales | - | - | Down 20.7% | | Comparable Store Sales | - | - | Down 21.8% | | Net Loss per Diluted Share | ($1.24) | ($3.85) | Improved | | Adjusted Net (Loss)/Income per Diluted Share | ($0.04) | $0.18 | Declined | [Management Commentary](index=1&type=section&id=Management%20Commentary) Management noted Custom Space strength and positive free cash flow from cost discipline, with future focus on Custom Spaces - The company experienced continued pressure on its general merchandise assortment while seeing relative strength in its premium Custom Space offerings[4](index=4&type=chunk) - Strong cost discipline led to **positive free cash flow** for the fiscal year[4](index=4&type=chunk) - Future plans include leaning into Custom Spaces, enhancing in-home design services, and building awareness through marketing to capitalize on opportunities when market conditions normalize[4](index=4&type=chunk) [Detailed Financial Performance](index=2&type=section&id=Detailed%20Financial%20Performance) The company experienced significant sales declines in both Q4 and full fiscal year 2023, impacted by general merchandise weakness and impairment charges [Fourth Quarter Fiscal 2023 Results](index=2&type=section&id=Fourth%20Quarter%20Fiscal%202023%20Results) Q4 2023 saw consolidated net sales decline 20.7%, driven by general merchandise, despite gross margin improvement and significant impairment charges Q4 Fiscal 2023 Performance Breakdown | Metric | Value | YoY Change | | :--- | :--- | :--- | | Consolidated Net Sales | $206.0M | -20.7% | | Comparable Store Sales | - | -21.8% | | - General Merchandise | - | -26.7% | | - Custom Spaces+ | - | -14.2% | | Online Sales | - | -30.8% | | Consolidated Gross Margin | 59.4% | +50 bps | | SG&A Expenses | $107.0M | -13.9% | - A non-cash trade names impairment charge of $73.8 million was recorded, consisting of a $63.8 million impairment for the TCS trade name and a $10.1 million impairment for the Elfa trade name[6](index=6&type=chunk) Q4 Fiscal 2023 Profitability | Metric | Q4 FY2023 | Q4 FY2022 | | :--- | :--- | :--- | | Net Loss | ($61.4M) | ($189.3M) | | Net Loss per Share | ($1.24) | ($3.85) | | Adjusted Net (Loss)/Income* | ($2.0M) | $8.8M | | Adjusted Net (Loss)/Income per Share* | ($0.04) | $0.18 | | Adjusted EBITDA* | $15.4M | $29.2M | [Full Fiscal Year 2023 Results](index=3&type=section&id=Fiscal%20Year%202023%20Results) Fiscal 2023 consolidated net sales decreased 19.0%, with improved gross margin and reduced SG&A, but significant impairment charges led to a net loss Full Fiscal Year 2023 Performance Breakdown | Metric | Value | YoY Change | | :--- | :--- | :--- | | Consolidated Net Sales | $847.8M | -19.0% | | Comparable Store Sales | - | -19.7% | | - General Merchandise | - | -21.9% | | - Custom Spaces+ | - | -15.4% | | Online Sales | - | -23.7% | | Consolidated Gross Margin | 57.7% | +30 bps | | SG&A Expenses | $439.5M | -9.7% | - Total non-cash impairment charges of $97.3 million were recorded in fiscal 2023, compared to $197.7 million in fiscal 2022. This included a $23.4 million goodwill impairment and $73.8 million in trade name impairments[8](index=8&type=chunk) Full Fiscal Year 2023 Profitability | Metric | Fiscal 2023 | Fiscal 2022 | | :--- | :--- | :--- | | Net Loss | ($103.3M) | ($158.9M) | | Net Loss per Share | ($2.09) | ($3.21) | | Adjusted Net (Loss)/Income* | ($15.9M) | $37.2M | | Adjusted Net (Loss)/Income per Share* | ($0.32) | $0.75 | | Adjusted EBITDA* | $48.1M | $115.4M | [Balance Sheet and Operations](index=4&type=section&id=Balance%20Sheet%20and%20Operations) The company expanded its store footprint, improved liquidity with positive free cash flow, and maintained a stable balance sheet despite increased debt [Store Operations](index=4&type=section&id=New%20and%20Existing%20Stores) The company expanded its store base to 102 in fiscal 2023 and plans further expansion and relocation in fiscal 2024 - The company's store base increased from 97 to 102 stores during fiscal 2023[10](index=10&type=chunk) - In fiscal 2024, the company plans to open four new stores, relocate one store, and close one store[10](index=10&type=chunk) [Balance Sheet and Liquidity](index=4&type=section&id=Balance%20sheet%20and%20liquidity%20highlights) The company ended fiscal 2023 with $21.0 million cash, $176.8 million total debt, and achieved positive free cash flow of $6.9 million Balance Sheet and Liquidity Highlights (as of March 30, 2024) | (In thousands) | March 30, 2024 | April 1, 2023 | | :--- | :--- | :--- | | Cash | $21,000 | $6,958 | | Total debt, net | $176,777 | $167,871 | | Liquidity | $112,276 | $106,997 | | Free cash flow* (FY) | $6,895 | ($4,918) | [Share Repurchase](index=4&type=section&id=Share%20repurchase) No share repurchases occurred in fiscal 2023, with $25 million remaining under the existing authorization - There were no share repurchases during fiscal 2023[12](index=12&type=chunk) - $25 million remains available under the company's share repurchase authorization[12](index=12&type=chunk) [Outlook and Strategic Initiatives](index=4&type=section&id=Outlook%20and%20Strategic%20Initiatives) The company observes improving sales trends in early fiscal 2024, driven by Custom Spaces, and has initiated a formal review of strategic alternatives [Fiscal 2024 To Date Commentary](index=4&type=section&id=Fiscal%202024%20To%20Date%20Commentary) Sales trends in Q1 fiscal 2024 improved compared to Q4 fiscal 2023, driven by Custom Spaces despite ongoing general merchandise challenges - Year-over-year sales trends have improved in Q1 fiscal 2024 to date when compared to Q4 fiscal 2023[13](index=13&type=chunk) - Performance is driven by relative strength in the Custom Spaces business, with year-over-year growth in Elfa and Preston product lines[13](index=13&type=chunk) - The general merchandise category remains challenged, resulting in **double-digit total sales declines**, though less severe than in Q4 2023[13](index=13&type=chunk) [Review of Strategic Alternatives](index=4&type=section&id=Review%20of%20Strategic%20Alternatives) The Board initiated a formal review of strategic alternatives to maximize stakeholder value, suspending financial guidance indefinitely - The Board of Directors has initiated a formal review process to evaluate strategic alternatives for the company[14](index=14&type=chunk) - The board and management believe the company's **current market value is not reflective of its intrinsic value** and are committed to **maximizing value for stakeholders**[14](index=14&type=chunk)[15](index=15&type=chunk) - The company is **suspending financial guidance** and has not set a deadline for the completion of the strategic review[17](index=17&type=chunk) [Consolidated Financial Statements](index=7&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements reflect significant sales declines, net losses, and balance sheet shifts due to impairment charges in fiscal 2023 [Consolidated Statements of Operations](index=7&type=section&id=Consolidated%20statements%20of%20operations) Fiscal 2023 net sales decreased 19.0% to $847.8 million, resulting in a significant operating loss and a net loss of $103.3 million Fiscal Year Ended (In thousands) | | March 30, 2024 | April 1, 2023 | | :--- | :--- | :--- | | Net sales | $847,779 | $1,047,258 | | Gross profit | $488,765 | $600,963 | | (Loss) from operations | ($104,734) | ($127,595) | | Net (loss) income | ($103,287) | ($158,856) | | Net (loss) income per share — diluted | ($2.09) | ($3.21) | [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20balance%20sheets) As of March 30, 2024, total assets decreased due to impairment, while total liabilities increased, leading to a significant reduction in shareholders' equity Assets (In thousands) | | March 30, 2024 | April 1, 2023 | | :--- | :--- | :--- | | Total current assets | $230,548 | $230,226 | | Goodwill | $0 | $23,447 | | Tradenames | $146,449 | $221,278 | | Total assets | $936,365 | $985,174 | Liabilities and Shareholders' Equity (In thousands) | | March 30, 2024 | April 1, 2023 | | :--- | :--- | :--- | | Total current liabilities | $193,087 | $190,315 | | Long-term debt | $174,611 | $163,385 | | Total liabilities | $776,674 | $722,989 | | Total shareholders' equity | $159,691 | $262,185 | [Consolidated Statements of Cash Flows](index=10&type=section&id=Consolidated%20statements%20of%20cash%20flows) Fiscal 2023 saw positive net cash from operations and reduced cash used in investing, resulting in a $14.0 million increase in cash balance Fiscal Year Ended (In thousands) | | March 30, 2024 | April 1, 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $46,789 | $59,305 | | Net cash used in investing activities | ($39,221) | ($64,411) | | Net cash provided by (used in) financing activities | $6,400 | ($1,669) | | Net increase (decrease) in cash | $14,042 | ($7,294) | | Cash at end of fiscal period | $21,000 | $6,958 | [Non-GAAP Financial Measures Reconciliation](index=11&type=section&id=Note%20Regarding%20Non-GAAP%20Information) The company provides reconciliations for non-GAAP measures like adjusted net income, Adjusted EBITDA, and free cash flow to offer clearer performance insights [Explanation of Non-GAAP Measures](index=11&type=section&id=Explanation%20of%20Non-GAAP%20Measures) The company uses non-GAAP measures like adjusted net income, Adjusted EBITDA, and free cash flow to provide clearer insights into core operating performance - **Adjusted net income (loss)** is defined as net income (loss) excluding items like restructuring charges, severance, impairment charges, and legal settlements to evaluate business strategies[38](index=38&type=chunk) - **Adjusted EBITDA** is used for covenant compliance and performance evaluation, further adjusting EBITDA for non-cash items like stock-based compensation and pre-opening costs[39](index=39&type=chunk) - **Free cash flow** is defined as net cash provided by operating activities minus payments for property and equipment, serving as a useful indicator of overall liquidity[40](index=40&type=chunk) [Reconciliation of GAAP to Non-GAAP Net Income (Loss)](index=12&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Financial%20Measures) GAAP net loss of $103.3 million for fiscal 2023 was adjusted to a non-GAAP net loss of $15.9 million, primarily due to impairment and severance charges Reconciliation of GAAP to Non-GAAP Net (Loss) Income (Fiscal Year Ended, in thousands) | | March 30, 2024 | April 1, 2023 | | :--- | :--- | :--- | | **Net (loss) income** | **($103,287)** | **($158,856)** | | Impairment charges | $97,279 | $197,712 | | Severance charges | $4,125 | $383 | | Legal settlement | $3,117 | ($2,600) | | Taxes and other | ($17,102) | $596 | | **Adjusted net (loss) income** | **($15,868)** | **$37,235** | [Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA](index=13&type=section&id=Reconciliation%20of%20GAAP%20Net%20Income%20(Loss)%20to%20Adjusted%20EBITDA) Adjusted EBITDA for fiscal 2023 significantly declined to $48.1 million from $115.4 million, after adjusting for non-cash and special items Reconciliation to Adjusted EBITDA (Fiscal Year Ended, in thousands) | | March 30, 2024 | April 1, 2023 | | :--- | :--- | :--- | | **Net (loss) income** | **($103,287)** | **($158,856)** | | Depreciation and amortization | $44,333 | $38,905 | | Interest expense, net | $20,672 | $16,171 | | (Benefit) provision for income taxes | ($22,119) | $15,090 | | **EBITDA** | **($60,401)** | **($88,690)** | | Impairment charges | $97,279 | $197,712 | | Stock-based compensation | $1,870 | $3,382 | | Other adjustments | $9,346 | $3,022 | | **Adjusted EBITDA** | **$48,094** | **$115,426** | [Reconciliation to Free Cash Flow](index=14&type=section&id=Reconciliation%20of%20Net%20Cash%20Provided%20by%20Operating%20Activities%20to%20Free%20Cash%20Flow) The company achieved **positive free cash flow** of $6.9 million in fiscal 2023, a significant improvement from a negative free cash flow in the prior year Free Cash Flow Reconciliation (Fiscal Year Ended, in thousands) | | March 30, 2024 | April 1, 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $46,789 | $59,305 | | Less: Additions to property and equipment | ($39,894) | ($64,223) | | **Free cash flow** | **$6,895** | **($4,918)** |

Financial Performance - Net sales for the thirteen weeks ended December 30, 2023, were $214.9 million, a decrease of 14.8% compared to $252.2 million for the same period in 2022[88]. - Gross profit for the thirty-nine weeks ended December 30, 2023, was $366.4 million, down 18.1% from $448.0 million in the prior year[88]. - The company reported a net loss of $6.4 million for the thirteen weeks ended December 30, 2023, compared to a net income of $4.2 million for the same period in 2022[88]. - Adjusted EBITDA for the thirteen weeks ended December 30, 2023, was $12.8 million, down from $22.2 million in the same period of 2022[94]. - Net sales for the thirty-nine weeks ended December 30, 2023 decreased by $145,800, or 18.5%, totaling $641,742[109]. - TCS net sales decreased by $36,786, or 15.4%, with comparable store sales down 16.8%, including a 26.3% decrease in online sales[100]. - Gross profit for the thirteen weeks ended December 30, 2023 decreased by $18,224, or 12.7%, while consolidated gross margin increased to 58.3% from 56.9%[101]. Expenses and Costs - Selling, general, and administrative expenses for the thirty-nine weeks ended December 30, 2023, were $332.5 million, a decrease of 8.2% from $362.1 million in the same period of 2022[88]. - Selling, general, and administrative expenses (excluding depreciation and amortization) increased to 52.0% of net sales from 48.2% year-over-year, reflecting higher operational costs[89]. - The company incurred impairment charges of $23.4 million for the thirty-nine weeks ended December 30, 2023, which were not present in the prior year[88]. - A non-cash goodwill impairment charge of $23,447 was recorded in the thirty-nine weeks ended December 30, 2023, compared to zero in the same period of 2022[114]. - Interest expense for the thirty-nine weeks ended December 30, 2023, increased to $15.4 million from $11.4 million in the previous year, reflecting a rise of 35.5%[88]. Store Operations - The company operates 100 stores as of December 30, 2023, with an average size of approximately 24,000 square feet[83]. - The number of stores at the end of the period remained stable at 100, unchanged from the previous year[89]. - The company opened two new stores during the third fiscal quarter of 2023 and plans to open two additional small format stores and four new stores in fiscal 2024[123]. Cash Flow and Capital Expenditures - Net cash provided by operating activities was $26,673 for the thirty-nine weeks ended December 30, 2023, compared to $18,856 for the same period in 2022[126]. - Total capital expenditures for the thirty-nine weeks ended December 30, 2023 were $33,376, with $16,700 allocated for store investments and $12,078 for technology[132]. - The company generated negative free cash flow of $6,703 for the thirty-nine weeks ended December 30, 2023, an improvement from negative free cash flow of $27,702 in the prior year[140]. - The company expects total capital expenditures to be in the range of $40,000 to $45,000 for technology infrastructure and new store development in fiscal 2023[121]. Debt and Credit Facilities - As of December 30, 2023, the company had $75,980 of unused borrowing availability under the Revolving Credit Facility[125]. - The aggregate principal amount in outstanding borrowings under the Senior Secured Term Loan Facility was $160,185 as of December 30, 2023[142]. - The aggregate principal amount of the Revolving Credit Facility is $100,000, with borrowings accruing interest at 1.25% plus SOFR[146]. - The Revolving Credit Facility allows for swing line advances of up to $15,000 and the issuance of letters of credit of up to $40,000[147]. - As of December 30, 2023, the company was in compliance with all covenants under the Revolving Credit Facility, with no Event of Default occurring[150]. Future Strategies - Future strategies include focusing on market expansion and new product development to enhance overall performance and mitigate losses[91].

The Container Store Group, Inc. (NYSE:TCS) Q3 2023 Results Conference Call February 6, 2024 4:30 PM ET Company Participants Caitlin Churchill - IR Satish Malhotra - CEO Jeff Miller - CFO Conference Call Participants Christopher Horvers - JP Morgan Kate McShane - Goldman Sachs Steven Forbes - Guggenheim Securities Operator Greetings, and welcome to The Container Store Third Quarter 2023 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce ...