- First Quarter Same Store Revenues Increased 9.6% on a
Two-Year Basis
- Lease Portfolio Size Ended First Quarter Up
Year-Over-Year
- Diluted EPS of $0.68; Non-GAAP
Diluted EPS of $0.87
- 2022 Aaron's Core Business Outlook Remains
Unchanged
- Updated Consolidated Outlook for 2022 Includes BrandsMart
U.S.A., Acquired April 1, 2022
ATLANTA, April 25,
2022 /PRNewswire/ -- The Aaron's Company, Inc. (NYSE:
AAN), a leading, technology-enabled, omnichannel provider of
lease-to-own and retail purchase solutions, today announced
financial results for the first quarter ended March 31,
2022.
"I am pleased to announce a strong start to 2022. Our customer
lease portfolio continues to perform well, and the Aaron's core
business remains on track with the outlook shared last quarter,"
said Douglas Lindsay, Chief
Executive Officer of The Aaron's Company. "The investments we
continue to make in our key strategic initiatives, including our
fast-growing e-commerce channel, digital origination and servicing
platforms, and high-performing GenNext stores, have enabled us to
deliver financial results consistent with our expectations for the
quarter.
"In addition, I could not be more excited about the acquisition
of BrandsMart U.S.A., which closed
earlier this month, and the meaningful value creation opportunities
it will provide. We continue to believe the consolidated company is
capable of delivering strong revenue and double digit annual
adjusted EBITDA growth over the next five years and beyond."
First Quarter 2022 Financial Highlights
Financial and operating results for the first quarter of 2022
and prior periods do not include BrandsMart U.S.A. ("BrandsMart"). As the acquisition of
BrandsMart occurred on April 1, 2022,
results for BrandsMart will be included in the Company's
consolidated financial statements commencing in the second quarter
of 2022.
Total revenues were $456.1 million
in the first quarter of 2022, a decrease of 5.2% compared to the
first quarter of 2021, primarily due to lower lease revenue
attributed to the expected normalization in the lease renewal rate
and lower exercise of early purchase options, which were partially
offset by the increased size of our lease portfolio. At the end of
the first quarter of 2022, our overall lease portfolio size was
$131.7 million, an increase of 2.3%
compared to the end of the first quarter of 2021. The lease renewal
rate for the first quarter was 89.4%, compared to 92.5% in the
government stimulus-aided first quarter of 2021. E-commerce
revenues increased 3.9% in the first quarter of 2022 compared to
the same period in 2021, and represented 15.4% of lease revenues.
During the quarter, the Company opened 19 GenNext locations.
Combined with the 116 locations open at the beginning of the
quarter, GenNext stores contributed 13.2% of lease and retail
revenues in the first quarter of 2022, with lease originations in
GenNext stores open less than one year continuing to grow at a rate
of more than 20 percentage points higher than our average legacy
stores.
Same store revenues increased 9.6% as compared to the first
quarter of 2020. In the first quarter of 2022, same store revenues
decreased 4.3% as compared to the first quarter of 2021, versus a
14.8% increase in the first quarter of 2021 as compared to the
first quarter of 2020. The decrease in the first quarter of 2022
was primarily driven by the expected normalization in the lease
renewal rate and lower exercise of early purchase options by our
customers. These factors were partially offset by the increased
size of our same store lease portfolio.
Net earnings for the first quarter of 2022 were $21.5 million compared to $36.3 million in the first quarter of 2021. First
quarter 2022 net earnings included acquisition-related costs of
$3.5 million, restructuring charges
of $3.3 million, and separation costs
of $0.5 million. Net earnings in the
first quarter of 2021 included separation costs of $4.4 million and restructuring charges of
$3.4 million.
Adjusted EBITDA was $54.7 million
in the first quarter of 2022, a decrease of 25.9% compared to the
first quarter of 2021. As a percentage of total revenues, adjusted
EBITDA margin was 12.0% in the first quarter of 2022 compared with
15.4% in the prior year first quarter. The declines in adjusted
EBITDA and adjusted EBITDA margin were primarily due to the
expected lower lease renewal rates and higher provision for lease
merchandise write-offs compared to the government stimulus-aided
levels in the first quarter of 2021, partially offset by lower
personnel and other operating expenses.
Diluted earnings per share were $0.68 in the first quarter of 2022 compared with
$1.04 in the first quarter of 2021.
On a non-GAAP basis, diluted earnings per share were $0.87 for the first quarter of 2022 compared with
$1.24 in the first quarter of
2021.
Share Repurchase Program and Dividend Activity
During the first quarter, the Company repurchased 261,924 shares
of Aaron's common stock for a total purchase price of approximately
$5.7 million. The total shares
outstanding as of March 31, 2022 were 30,963,018, compared to
34,169,998 as of March 31, 2021. On March 3, 2022, the Company's Board of Directors
increased the share repurchase authorization to $250.0 million from the original $150.0 million plan and extended the maturity to
December 31, 2024. The remaining
authorized share repurchase amount was $141.2 million as of March
31, 2022. In addition, the Board declared a quarterly cash
dividend of $0.1125 per share which
was paid to shareholders on April 5,
2022.
Full Year 2022 Outlook
The Company has updated its full year 2022 outlook to reflect
the acquisition of BrandsMart that closed April 1, 2022. For the full-year 2022, we expect
consolidated total revenues between $2.32 and $2.39
billion, adjusted EBITDA between $200 and $215
million, and non-GAAP earnings per share between
$2.65 and $2.90.
Excluding the BrandsMart acquisition, the Aaron's core business
outlook for total revenues, adjusted EBITDA, and annual same store
revenues remains consistent with the outlook provided on
February 23, 2022. Due to global
supply chain challenges, we are revising our forecast of new
GenNext store remodels and repositionings to be completed in 2022
to 100 locations. We expect to complete the remaining 20 locations
originally scheduled for the current year in 2023.
We are assuming an effective tax rate for 2022 of approximately
26%, depreciation and amortization of $80
million to $85 million, and a
diluted weighted average share count of approximately 32.0 million
shares. This outlook assumes no significant deterioration in the
current retail environment, state of the U.S. economy, or global
supply chain, as compared to its current condition.
|
Current
Outlook1, 2
|
|
Low
|
High
|
Consolidated - Total
Revenues
|
$2,320
million
|
$2,390
million
|
Consolidated - Adjusted
EBITDA
|
$200
million
|
$215
million
|
Consolidated - Non-GAAP
EPS
|
$2.65
|
$2.90
|
Consolidated - Capital
Expenditures
|
$100
million
|
$125
million
|
Consolidated - Free
Cash Flow
|
$45
million
|
$55
million
|
|
|
|
BrandsMart - Total
Revenues
|
$545
million
|
$565
million
|
BrandsMart - Adjusted
EBITDA
|
$20
million
|
$25
million
|
|
1 See
the "Use of Non-GAAP Financial Information" section accompanying
the press release.
|
2
BrandsMart outlook represents expected results for the nine
months ended December 31, 2022.
|
Conference Call and Webcast
The Company will hold a conference call to discuss its quarterly
results on April 26, 2022, at 8:30 a.m.
Eastern Time. The public is invited to listen to the
conference call by webcast accessible through the Company's
investor relations website, investor.aarons.com. The webcast will
be archived for playback at that same site.
About The Aaron's Company Inc.
Headquartered in Atlanta, The
Aaron's Company, Inc. (NYSE: AAN) is a leading, technology-enabled,
omnichannel provider of lease-to-own and retail purchase solutions
of appliances, electronics, furniture, and other home goods across
its brands, Aaron's and BrandsMart U.S.A. Aaron's offers a direct-to-consumer
lease-to-own solution through its 1,300 Company-operated and
franchised stores in 47 states and Canada, as well as its e-commerce platform.
BrandsMart U.S.A. is one of the
leading appliance retailers in the country with ten retail stores
in Florida and Georgia. For more information, visit
investor.aarons.com, aarons.com, and brandsmartusa.com.
Forward-Looking Statements
Statements in this news release regarding our business that
are not historical facts are "forward-looking statements" that
involve risks and uncertainties which could cause actual results to
differ materially from those contained in the forward-looking
statements. Such forward-looking statements generally can be
identified by the use of forward-looking terminology, such as
"remain," "believe," "outlook," "expect," "assume," "assumed," and
similar terminology. These risks and uncertainties include
factors such as (i) any ongoing impact of the COVID-19 pandemic due
to new variants or efficacy and rate of vaccinations, as well as
related measures taken by governmental or regulatory authorities to
combat the pandemic, including the impact of federal vaccine
mandates on our workforce and whether additional government
stimulus payments or supplemental unemployment benefits will be
approved, and the nature, amount and timing of any such payments or
benefits, (ii) the possibility that the operational, strategic and
shareholder value creation opportunities expected from the
separation and spin-off of the Aaron's Business into what is now
The Aaron's Company, Inc. may not be achieved in a timely manner,
or at all; (iii) the failure of that separation to qualify for the
expected tax treatment; (iv) the risk that the Company may fail to
realize the benefits expected from the acquisition of BrandsMart,
including projected synergies;
(v) risks related to the disruption of management time from
ongoing business operations due to the acquisition; (vi) failure to
promptly and effectively integrate the BrandsMart acquisition;
(vii) the effect of the acquisition on our operating results and
businesses and on the ability of Aaron's and BrandsMart to retain
and hire key personnel or maintain relationships with suppliers;
(viii) changes in the enforcement and interpretation of existing
laws and regulations and the adoption of new laws and regulations
that may unfavorably impact our business; (ix) legal and regulatory
proceedings and investigations, including those related to consumer
protection laws and regulations, customer privacy, third party and
employee fraud, and information security; (x) the risks associated
with our strategy and strategic priorities not being successful,
including our e-commerce and real estate repositioning and
optimization initiatives or being more costly than anticipated;
(xi) risks associated with the challenges faced by our business,
including the commoditization of consumer electronics and our high
fixed-cost operating model; (xii) increased competition from
traditional and virtual lease-to-own competitors, as well as from
traditional and online retailers and other competitors; (xiii)
financial challenges faced by our franchisees; (xiv) increases in
lease merchandise write-offs, and the potential limited duration
and impact of government stimulus and other government payments
made by Federal and State governments to counteract the economic
impact of the pandemic; (xv) the availability and prices of supply
chain resources, including products and transportation; and (xvi)
the other risks and uncertainties discussed under "Risk Factors" in
the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 2021. Statements in this
press release that are "forward-looking" include without limitation
statements about: (i) the execution of our key strategic
priorities; (ii) the growth and other benefits we expect from
executing those priorities; (iii) our 2022 financial performance
outlook; (iv) the Company's goals, plans, expectations, and
projections regarding the expected benefits of the BrandsMart
acquisition; and
(v) the impact on our 2022 financial performance of
additional rounds of government stimulus payments. You are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this press release.
Except as required by law, the Company undertakes no obligation to
update these forward-looking statements to reflect subsequent
events or circumstances after the date of this press
release.
THE AARON'S COMPANY,
INC.
|
Consolidated
Statements of Earnings
|
(In thousands,
except per share amounts)
|
|
|
|
(Unaudited)
Three Months
Ended
|
|
March 31,
|
|
|
2022
|
2021
|
REVENUES:
|
|
|
|
Lease and Retail Revenues
|
|
$
421,925
|
$
444,087
|
Non-Retail Sales
|
|
27,827
|
29,949
|
Franchise Royalties and Other Revenues
|
|
6,330
|
7,018
|
|
|
456,082
|
481,054
|
COST OF REVENUES:
|
|
|
|
Cost of Lease and Retail Revenues
|
|
145,779
|
151,495
|
Non-Retail Cost of Sales
|
|
25,356
|
26,491
|
|
|
171,135
|
177,986
|
GROSS PROFIT
|
|
284,947
|
303,068
|
OPERATING EXPENSES:
|
|
|
|
Personnel Expenses
|
|
121,110
|
124,863
|
Other Operating Expenses, Net
|
|
104,359
|
108,366
|
Provision for Lease Merchandise Write-Offs
|
|
21,957
|
13,417
|
Restructuring Expenses, Net
|
|
3,335
|
3,441
|
Separation Costs
|
|
540
|
4,390
|
Acquisition-Related Costs
|
|
3,464
|
—
|
|
|
254,765
|
254,477
|
OPERATING PROFIT
|
|
30,182
|
48,591
|
Interest Expense
|
|
(350)
|
(344)
|
Other Non-Operating (Expense) Income, Net
|
|
(927)
|
402
|
EARNINGS BEFORE INCOME TAX
EXPENSE
|
|
28,905
|
48,649
|
INCOME TAX EXPENSE
|
|
7,373
|
12,326
|
NET EARNINGS
|
|
$ 21,532
|
$ 36,323
|
|
|
|
|
EARNINGS PER SHARE
|
|
$
0.69
|
$
1.06
|
EARNINGS PER SHARE ASSUMING
DILUTION
|
|
$
0.68
|
$
1.04
|
WEIGHTED AVERAGE SHARES
OUTSTANDING
|
|
31,062
|
34,262
|
WEIGHTED AVERAGE SHARES OUTSTANDING ASSUMING
DILUTION
|
|
31,760
|
34,919
|
THE AARON'S
COMPANY, INC.
|
CONSOLIDATED BALANCE
SHEETS
|
(In
thousands)
|
|
|
(Unaudited)
|
|
|
|
March 31,
2022
|
|
December 31,
2021
|
ASSETS:
|
|
|
|
Cash and Cash Equivalents
|
$
13,518
|
|
$
22,832
|
Accounts Receivable (net of allowances of $5,251 at
March 31, 2022 and
$7,163 at December 31, 2021)
|
26,930
|
|
29,443
|
Lease Merchandise (net of accumulated depreciation and
allowances of
$432,842 at March 31, 2022 and $439,745 at
December 31, 2021)
|
769,018
|
|
772,154
|
Property, Plant and Equipment, Net
|
230,945
|
|
230,895
|
Operating Lease Right-of-Use Assets
|
288,131
|
|
278,125
|
Goodwill
|
13,022
|
|
13,134
|
Other Intangibles, Net
|
4,288
|
|
5,095
|
Income Tax Receivable
|
2,711
|
|
3,587
|
Prepaid Expenses and Other Assets
|
97,799
|
|
86,000
|
Total Assets
|
$
1,446,362
|
|
$
1,441,265
|
LIABILITIES & SHAREHOLDERS'
EQUITY:
|
|
|
|
Accounts Payable and Accrued Expenses
|
$
242,702
|
|
$
244,670
|
Deferred Income Taxes Payable
|
98,565
|
|
92,306
|
Customer Deposits and Advance Payments
|
56,203
|
|
66,289
|
Operating Lease Liabilities
|
317,984
|
|
309,834
|
Debt
|
—
|
|
10,000
|
Total Liabilities
|
715,454
|
|
723,099
|
|
|
|
|
Shareholders'
Equity:
|
|
|
|
Common Stock, Par Value $0.50 Per Share: Authorized:
112,500,000 Shares at
March 31, 2022 and December 31, 2021;
Shares Issued: 35,968,806 at
March 31, 2022 and 35,558,714 at
December 31, 2021
|
17,984
|
|
17,779
|
Additional Paid-in Capital
|
727,842
|
|
724,384
|
Retained Earnings
|
116,494
|
|
98,546
|
Accumulated Other Comprehensive Loss
|
(347)
|
|
(739)
|
|
861,973
|
|
839,970
|
Less: Treasury Shares
at Cost
|
|
|
|
5,005,788 Shares at March 31, 2022 and 4,580,390 at
December 31, 2021
|
(131,065)
|
|
(121,804)
|
Total Shareholders'
Equity
|
730,908
|
|
718,166
|
Total
Liabilities & Shareholders' Equity
|
$
1,446,362
|
|
$
1,441,265
|
THE AARON'S
COMPANY, INC.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
(Unaudited)
|
|
Three Months
Ended
March
31,
|
(In
Thousands)
|
2022
|
|
2021
|
OPERATING
ACTIVITIES:
|
|
|
|
Net
Earnings
|
$
21,532
|
|
$
36,323
|
Adjustments to Reconcile Net Earnings to Cash Provided by
Operating Activities:
|
|
|
|
Depreciation of Lease
Merchandise
|
134,713
|
|
139,212
|
Other Depreciation and
Amortization
|
18,149
|
|
17,067
|
Provision for Lease Merchandise
Write-Offs
|
21,957
|
|
13,417
|
Accounts Receivable
Provision
|
6,753
|
|
3,763
|
Stock-Based
Compensation
|
3,611
|
|
3,593
|
Deferred Income
Taxes
|
6,241
|
|
8,741
|
Impairment of Assets
|
1,585
|
|
2,272
|
Non-Cash Lease
Expense
|
23,971
|
|
23,030
|
Other Changes, Net
|
(4,576)
|
|
(831)
|
Changes in Operating Assets and Liabilities:
|
|
|
|
Lease Merchandise
|
(153,711)
|
|
(160,895)
|
Accounts Receivable
|
(4,190)
|
|
2,265
|
Prepaid Expenses and Other
Assets
|
(11,610)
|
|
1,440
|
Income Tax
Receivable
|
876
|
|
270
|
Operating Lease Right-of-Use
Assets and Liabilities
|
(27,009)
|
|
(37,776)
|
Accounts Payable and Accrued
Expenses
|
846
|
|
(21,563)
|
Customer Deposits and Advance
Payments
|
(10,086)
|
|
(10,129)
|
Cash Provided by
Operating Activities
|
29,052
|
|
20,199
|
INVESTING
ACTIVITIES:
|
|
|
|
Purchases of Property, Plant, and Equipment
|
(25,103)
|
|
(27,032)
|
Proceeds from Dispositions of Property, Plant, and
Equipment
|
8,136
|
|
2,695
|
Acquisition of Businesses and Customer Agreements, Net of
Cash Acquired
|
(286)
|
|
(1,062)
|
Proceeds from Other Investing-Related Activities
|
190
|
|
1,974
|
Cash Used in Investing
Activities
|
(17,063)
|
|
(23,425)
|
FINANCING
ACTIVITIES:
|
|
|
|
Repayments on Revolving Facility, Net
|
(10,000)
|
|
—
|
Repayments on Debt
|
—
|
|
(492)
|
Dividends Paid
|
(3,110)
|
|
(3,430)
|
Acquisition of Treasury Stock
|
(4,722)
|
|
(5,727)
|
Issuance of Stock Under Stock Option Plans
|
52
|
|
543
|
Shares Withheld for Tax Payments
|
(3,541)
|
|
(2,729)
|
Cash Used in Financing
Activities
|
(21,321)
|
|
(11,835)
|
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH
EQUIVALENTS
|
18
|
|
2
|
Decrease in Cash and
Cash Equivalents
|
(9,314)
|
|
(15,059)
|
Cash and Cash Equivalents at Beginning of Period
|
22,832
|
|
76,123
|
Cash and Cash Equivalents at End of Period
|
$
13,518
|
|
$
61,064
|
Use of Non-GAAP Financial Information:
Non-GAAP net earnings, non-GAAP diluted earnings per share,
EBITDA and adjusted EBITDA are supplemental measures of our
performance that are not calculated in accordance with generally
accepted accounting principles in the
United States ("GAAP"). Non-GAAP net earnings and
non-GAAP diluted earnings per share for 2022 exclude certain
charges including amortization expense resulting from acquisitions,
restructuring charges, separation costs associated with the
separation and distribution transaction that resulted in our
spin-off into a separate publicly-traded company, and
acquisition-related costs. Non-GAAP net earnings and non-GAAP
diluted earnings per share for 2021 exclude certain charges
including amortization expense resulting from acquisitions,
restructuring charges and separation costs associated with the
separation and distribution transaction that resulted in our
spin-off into a separate publicly-traded company. The amounts for
these pre-tax non-GAAP adjustments, which are tax-effected using
estimated tax rates which are commensurate with non-GAAP pre-tax
earnings, can be found in the Reconciliation of Net Earnings and
Earnings Per Share Assuming Dilution to Non-GAAP Net Earnings and
Non-GAAP Earnings Per Share Assuming Dilution table in this press
release.
The EBITDA and adjusted EBITDA figures presented in this press
release are calculated as the Company's earnings before interest
expense, depreciation on property, plant and equipment,
amortization of intangible assets and income taxes. Adjusted EBITDA
also excludes the other adjustments described in the calculation of
non-GAAP net earnings above. Adjusted EBITDA margin is defined as
EBITDA as a percentage of revenue. The amounts for these pre-tax
non-GAAP adjustments can be found in the Quarterly EBITDA table in
this press release.
Management believes that non-GAAP net earnings, non-GAAP diluted
earnings per share, EBITDA and Adjusted EBITDA provide relevant and
useful information, and are widely used by analysts, investors and
competitors in our industry as well as by our management in
assessing both consolidated and business unit performance.
Non-GAAP net earnings and non-GAAP diluted earnings per share
provide management and investors with an understanding of the
results from the primary operations of our business by excluding
the effects of certain items that generally arose from larger,
one-time transactions that are not reflective of the ordinary
earnings activity of our operations or transactions that have
variability and volatility of the amount. This measure may be
useful to an investor in evaluating the underlying operating
performance of our business.
EBITDA and Adjusted EBITDA also provide management and investors
with an understanding of one aspect of earnings before the impact
of investing and financing charges and income taxes. These
measures may be useful to an investor in evaluating our operating
performance and liquidity because the measures:
- Are widely used by investors to measure a company's operating
performance without regard to items excluded from the calculation
of such measure, which can vary substantially from company to
company depending upon accounting methods, book value of assets,
capital structure and the method by which assets were acquired,
among other factors.
- Are a financial measurement that is used by rating agencies,
lenders and other parties to evaluate our creditworthiness.
- Are used by our management for various purposes, including as a
measure of performance of our operating entities and as a basis for
strategic planning and forecasting.
The Free Cash Flow figures presented in this press release and
in the press release dated February 23,
2022 are calculated as the Company's cash flows provided by
operating activities and proceeds from real estate transactions,
less capital expenditures. Management believes that Free Cash Flow
is an important measure of liquidity provides relevant and useful
information, and are widely used by analysts, investors and
competitors in our industry as well as by our management in
assessing liquidity.
Non-GAAP financial measures, however, should not be used as a
substitute for, or considered superior to, measures of financial
performance prepared in accordance with GAAP, such as the Company's
GAAP basis net earnings and diluted earnings per share, the
Company's GAAP revenues and earnings before income taxes and GAAP
cash from operating activities, which are also presented in the
press release. Further, we caution investors that amounts
presented in accordance with our definitions of non-GAAP net
earnings, non-GAAP diluted earnings per share, EBITDA, adjusted
EBITDA and Free Cash Flow may not be comparable to similar measures
disclosed by other companies, because not all companies and
analysts calculate these measures in the same manner.
Reconciliation of
Net Earnings and Earnings Per Share Assuming Dilution
to Non-GAAP Net
Earnings and Non-GAAP Earnings Per Share Assuming
Dilution
|
(In thousands,
except per share)
|
|
|
(Unaudited)
Three Months
Ended
|
|
March 31,
|
|
2022
|
2021
|
Net Earnings
|
$
21,532
|
$
36,323
|
Income
Taxes
|
7,373
|
12,326
|
Earnings Before Income
Taxes
|
$
28,905
|
$
48,649
|
Add:
Acquisition-Related Intangible Amortization Expense
|
641
|
1,507
|
Add:
Restructuring Expenses, Net
|
3,335
|
3,441
|
Add: Separation
Costs
|
540
|
4,390
|
Add:
Acquisition-Related Costs
|
3,464
|
—
|
Non-GAAP Earnings
Before Income Taxes
|
36,885
|
57,987
|
|
|
|
Income taxes,
calculated using a non-GAAP Effective Tax Rate
|
9,409
|
14,692
|
Non-GAAP Net
Earnings
|
$
27,476
|
$
43,295
|
|
|
|
|
|
|
Earnings Per Share
Assuming Dilution
|
$
0.68
|
$
1.04
|
Add:
Acquisition-Related Intangible Amortization Expense
|
0.02
|
0.04
|
Add:
Restructuring Expenses, Net
|
0.11
|
0.10
|
Add: Separation
Costs
|
0.02
|
0.13
|
Add:
Acquisition-Related Costs
|
0.11
|
—
|
Tax Effect of
Non-GAAP adjustments
|
$
(0.06)
|
$
(0.07)
|
Non-GAAP Earnings Per
Share Assuming Dilution(1)
|
$
0.87
|
$
1.24
|
|
|
|
Weighted Average Shares
Outstanding Assuming Dilution
|
31,760
|
34,919
|
|
(1) In some
cases, the sum of individual EPS amounts may not equal total
non-GAAP EPS calculations due to rounding.
|
The Aaron's Company,
Inc.
|
Non-GAAP Financial Information
|
Quarterly EBITDA
|
(In
thousands)
|
|
|
(Unaudited)
|
|
Three Months
Ended
|
|
March 31,
2022
|
|
March 31,
2021
|
Net Earnings
|
$
21,532
|
|
$
36,323
|
Income
Taxes
|
7,373
|
|
12,326
|
Earnings Before Income
Taxes
|
$
28,905
|
|
$
48,649
|
Interest
Expense
|
350
|
|
344
|
Depreciation
|
17,385
|
|
15,383
|
Amortization
|
764
|
|
1,684
|
EBITDA
|
$
47,404
|
|
$
66,060
|
Separation
Costs
|
540
|
|
4,390
|
Acquisition-Related Costs
|
3,464
|
|
—
|
Restructuring
Expenses, Net
|
3,335
|
|
3,441
|
Adjusted
EBITDA
|
$
54,743
|
|
$
73,891
|
Reconciliation of
2022 Current Outlook for Adjusted EBITDA
|
(In
thousands)
|
|
|
Fiscal Year 2022
Ranges
|
|
BrandsMart
U.S.A.1
|
Consolidated
Total2
|
Estimated Net
Earnings
|
|
$75,000 -
$81,000
|
Income Taxes
|
|
26,000 -
28,000
|
Projected Earnings
Before Income Taxes
|
$13,500 -
$16,500
|
$101,000 -
$109,000
|
Interest
Expense
|
—
|
9,000 -
10,000
|
Depreciation and
Amortization
|
4,000 -
5,000
|
80,000 -
85,000
|
Projected
EBITDA
|
$17,500 -
$21,500
|
$190,000 -
$204,000
|
Projected Other
Adjustments, Net
|
2,500 -
3,500
|
10,000 -
11,000
|
Projected Adjusted
EBITDA
|
$20,000 -
$25,000
|
$200,000 -
$215,000
|
|
|
(1)
|
Amortization related to
the acquired BrandsMart intangible assets has been excluded from
this Outlook as the respective fair values are pending the
completion of the purchase price valuation and cannot be reasonably
estimated. Projected Other Adjustments, Net includes one-time
integration and other acquisition-related costs.
|
(2)
|
Projected Other
Adjustments, Net includes the projected non-GAAP charges related to
restructuring charges, separation costs associated with the
separation and distribution transaction that resulted in our
spin-off into a separate publicly-traded company and BrandsMart
one-time integration and other acquisition-related costs.
Amortization related to the acquired BrandsMart intangible assets
has been excluded from this Outlook as the respective fair values
are pending the completion of the purchase price valuation and
cannot be reasonably estimated.
|
Reconciliation of
2022 Current Outlook for Earnings Per Share
|
Assuming Dilution
to Non-GAAP Earnings Per Share Assuming
Dilution
|
|
|
Fiscal Year 2022
Range
|
|
Low
|
High
|
Projected Earnings Per
Share Assuming Dilution
|
$
2.39
|
$
2.57
|
Add Sum of Projected
Other Adjustments1
|
0.26
|
0.33
|
Projected Non-GAAP
Earnings Per Share Assuming Dilution
|
$
2.65
|
$
2.90
|
|
|
(1)
|
Includes the projected
non-GAAP charges related to restructuring charges, separation costs
associated with the separation and distribution transaction that
resulted in our spin-off into a separate publicly-traded company
and BrandsMart one-time integration and other acquisition-related
costs. Amortization related to the acquired BrandsMart intangible
assets has been excluded from this Outlook as the respective fair
values are pending the completion of the purchase price valuation
and cannot be reasonably estimated.
|
Reconciliation of
2022 Current Outlook for Free Cash Flow
|
(In
thousands)
|
|
|
Fiscal Year 2022
Ranges
|
|
Consolidated
Total
|
Cash Provided by
Operating Activities
|
$139,000 -
$173,000
|
Add: Proceeds from Real
Estate Transactions
|
$6,000 -
$7,000
|
Less: Capital
Expenditures
|
(100,000 -
125,000)
|
Free Cash
Flow
|
$45,000 -
$55,000
|
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SOURCE The Aaron's Company, Inc.