National Vision(US:EYE)2024-08-07 10:07Financial Performance - Net revenue from continuing operations for Q2 2024 was $451.7 million, a 4.6% increase compared to Q2 2023[1] - The company reported a net loss from continuing operations of $(1.0) million, with a Diluted EPS of $(0.01) for Q2 2024[1] - Total net revenue for the three months ended June 29, 2024, was $451.733 million, an increase of 4.3% compared to $431.786 million for the same period in 2023[32] - Net product sales reached $361.967 million for the three months ended June 29, 2024, compared to $352.180 million for the same period in 2023, reflecting a growth of 2.0%[32] - The company reported a net loss of $3.125 million for the three months ended June 29, 2024, compared to a net income of $5.614 million for the same period in 2023[32] - Basic earnings per share from continuing operations was $(0.01) for the three months ended June 29, 2024, compared to $0.05 for the same period in 2023[32] - Net income for the six months ended June 29, 2024, was $8,560,000, a decrease from $23,884,000 for the same period last year, representing a decline of approximately 64.1%[34] - Adjusted Operating Income from continuing operations for the six months ended June 29, 2024, was $47,967,000, compared to $44,934,000 for the same period last year, reflecting an increase of about 6.8%[36] - EBITDA from continuing operations for the six months ended June 29, 2024, was $69,946,000, down from $77,406,000 for the same period last year, indicating a decrease of approximately 10.0%[37] Store Operations - Comparable store sales growth was 2.2%, with Adjusted Comparable Store Sales Growth at 2.4%, driven by increased customer transactions and higher average ticket[5] - The company opened 17 new stores, ending the quarter with a total of 1,216 stores, reflecting a 5.6% growth in store count from July 1, 2023 to June 29, 2024[5] - Total comparable store sales growth from continuing operations was 2.2% for the three months ended June 29, 2024, compared to (0.2)% for the same period in 2023[44] - Adjusted Comparable Store Sales Growth from continuing operations was 2.4% for the three months ended June 29, 2024, compared to 1.1% for the same period in 2023[44] - The company's 2024 outlook for total comparable store sales growth is projected to be between 1.0% and 2.0%[44] Financial Guidance - For fiscal 2024, the updated outlook for net revenue is projected to be between $1.820 billion and $1.840 billion[14] - Adjusted Diluted EPS guidance for fiscal 2024 is revised to a range of $0.45 to $0.50[14] Cash and Debt Management - The company’s cash balance as of June 29, 2024, was $179.5 million, with total debt at $456.8 million[9] - Cash and cash equivalents increased to $179.515 million as of June 29, 2024, up from $149.896 million as of December 30, 2023, marking a growth of 19.8%[27] - Total current assets decreased to $364.402 million as of June 29, 2024, down from $396.670 million as of December 30, 2023, representing a decline of 8.1%[27] - Total liabilities increased to $1.302 billion as of June 29, 2024, compared to $1.343 billion as of December 30, 2023, indicating a reduction of 3.1%[29] - Cash, cash equivalents, and restricted cash at the end of the period were $180,992,000, down from $255,984,000 at the end of the previous year, a decrease of approximately 29.2%[34] Operational Efficiency - Adjusted Operating Income increased by 13.8% to $14.1 million, with an Adjusted Operating Margin of 3.1%[5] - Selling, general and administrative expenses rose to $231.353 million for the three months ended June 29, 2024, compared to $222.924 million for the same period in 2023, an increase of 3.0%[32] - SG&A from continuing operations for the three months ended June 29, 2024, was $231.4 million, representing 51.2% of net revenue, compared to $222.9 million or 51.6% for the same period in 2023[42] - Adjusted SG&A from continuing operations was $221.8 million for the three months ended June 29, 2024, compared to $217.4 million for the same period in 2023[42] Strategic Initiatives - The company is taking new actions to drive profitable growth, including leadership changes and initiatives to expand exam capacity[11] - National Vision's growth strategy includes expanding its retail presence and enhancing its e-commerce capabilities to meet consumer demand[17] - The company emphasizes the importance of recruiting and retaining vision care professionals to support its in-store and remote care offerings[17] - National Vision's strategic direction includes leveraging technological advancements and addressing ESG issues to enhance its operational resilience[17] Risks and Challenges - National Vision is facing risks related to market volatility, inflation, and consumer spending, which could materially impact its sales and profitability[17] - The company reported a net cash provided by operating activities of $75,448,000 for the six months ended June 29, 2024, compared to $112,216,000 for the same period last year, a decline of about 32.8%[34] - National Vision's financial performance may be adversely affected by its reliance on third-party coverage and reimbursement for a significant portion of its revenues[19] - The company is committed to maintaining relationships with managed vision care companies and vision insurance providers to support its business model[19] Tax and Accounting Practices - The company is implementing a discrete effective tax rate method for its income tax provision, moving away from the annualized effective tax rate method due to reliability concerns[25] - The company utilizes non-GAAP financial measures such as Adjusted EBITDA and Adjusted Operating Income to provide a clearer picture of its operational performance[20] - Adjusted EBITDA Margin from continuing operations for the three months ended June 29, 2024, was 8.1%, compared to 7.9% for the same period last year, showing an improvement of 0.2 percentage points[37] Stock Performance - The diluted EPS from continuing operations for the six months ended June 29, 2024, was $0.44, compared to $0.41 for the same period last year, reflecting an increase of about 7.3%[38] - Adjusted Diluted EPS from discontinued operations was $0.00 for the three months ended June 29, 2024, compared to $0.04 for the same period in 2023[39] - The company reported an adjusted diluted EPS of $0.03 for the six months ended June 29, 2024, compared to $0.10 for the same period in 2023[39] - Stock-based compensation expense for the three months ended June 29, 2024, was $4.8 million, compared to $5.2 million for the same period in 2023[42] - The company incurred stock-based compensation expense of $7,164,000 for the six months ended June 29, 2024, compared to $9,221,000 for the same period last year, a reduction of approximately 22.3%[36] - The weighted average diluted shares outstanding increased to 78,575,000 for the three months ended June 29, 2024, from 78,343,000 for the same period last year[38]