e.l.f. Beauty Provides Business Update
March 30 2020 - 6:00AM
Business Wire
– Reaffirms Fiscal Year 2020 Guidance –
– Anticipates Category Decline During COVID-19
Pandemic –
e.l.f. Beauty (NYSE: ELF) today reaffirmed its fiscal 2020
guidance and announced it will report fourth quarter and fiscal
year-end 2020 results on May 21, 2020.
“During these challenging times, we are focused on the safety
and well-being of our employees and the consumers that we serve. We
are pleased that in this environment we are able to reaffirm our
fiscal 2020 guidance,” said Tarang Amin, Chairman and CEO. “We are
seeing a change in consumer behavior due to the COVID-19 pandemic
and anticipate that our sales and Nielsen tracked channel results,
while better than the category, will be significantly depressed
during this time. Our liquidity is strong and we are proactively
managing spend. We remain confident in our long-term growth
potential given our proposition of delivering prestige quality
cosmetics and skin care at an extraordinary value.”
Fiscal 2020 Update
- The Company reaffirms fiscal 2020 guidance, issued on February
5, 2020, due to the strong execution of its five strategic
imperatives. This guidance reflected net sales up 7 to 8 percent
year over year, excluding the contribution of e.l.f. retail
stores:
FY 20 Guidance
Net Sales
$274-277 million
Adj EBITDA
$58 – 60 million
Adj Net Income
$28 – 30 million
Adj EPS
$0.55 - $0.59
- The Company’s China operations are back to normal run rates and
U.S. distribution centers are currently fulfilling national
retailer and e-commerce orders. The Company’s inventory position
remains sufficient to supply Walmart, Target, other retailers and
on-line needs.
COVID-19 Business Update
- While the Company is reaffirming net sales guidance for fiscal
2020, it’s seen a significant decline in retail sales over the last
two weeks due to the impact of COVID-19 on consumer behavior. The
Company anticipates its sales and Nielsen tracked channel results
to be negatively impacted until consumers return to normal shopping
patterns.
- The Company is focused on e.l.f.’s relative performance to the
category and the opportunity to build market share.
- The Company has a strong liquidity position. As of today, the
Company has approximately $45 million in cash on hand and access to
a $50 million dollar revolving credit facility. The Company is
seeking to reduce working capital, better match marketing expense
to demand, and explore other areas to reduce operational
costs.
- Longer-term, the Company remains confident in its core value
proposition of delivering prestige quality cosmetics and skin care
at extraordinary prices.
Year-End Earnings Conference
Call
- The Company will conduct a conference call on May 21, 2020 to
review full-year 2020 results and provide perspective on fiscal
2021.
About e.l.f. Beauty
Since 2004, e.l.f. has made the best of beauty accessible to
every eye, lip and face. We make high-quality, prestige-inspired
cosmetics and skin care products at an extraordinary value and are
proud to be 100% vegan and cruelty-free. As one of the first online
beauty brands, e.l.f. has a passionate social following, national
distribution at leading retailers such as Target, Walmart and Ulta
Beauty, and a growing international presence. Learn more by
visiting www.elfcosmetics.com.
Forward-looking statements
This press release contains forward-looking statements within
the meaning of the federal securities laws, including those
statements relating to the Company’s reaffirmation of its fiscal
2020 guidance, the Company’s anticipation that its sales and
Nielsen tracked channel results will be negatively impacted until
consumers return to normal shopping patterns, the Company’s
confidence in its long-term growth potential, the Company’s belief
that its inventory position remains sufficient to supply Walmart,
Target, other retailers and on-line needs, the Company’s focus on
e.l.f.’s relative performance to the category, the Company’s
expectations regarding opportunity to build market share, and the
Company’s plans to seek to reduce working capital, better match
marketing expense to demand, and explore other areas to reduce
operational costs. These forward-looking statements are based on
management's current expectations, estimates, forecasts,
projections, beliefs and assumptions and are not guarantees of
future performance. Although the Company believes that the
expectations reflected in the forward-looking statements are
reasonable, actual results and the timing of selected events may
differ materially from those expectations. Factors that could cause
actual results to differ materially from those in the
forward-looking statements include, among other things, the risks
and uncertainties that are described in the Company's most recent
Quarterly Report on Form 10-Q and Annual Report on Form 10-K, as
updated from time to time in the Company's SEC filings, as well as
the duration and magnitude of the impact of COVID-19 on the
behavior and shopping patterns of the Company’s consumers, the
Company’s ability to maintain business with its existing retail
customers; and the Company’s ability to effectively manage its
expenses. Potential investors are urged to consider these factors
carefully in evaluating the forward-looking statements. These
forward-looking statements speak only as of the date hereof. Except
as required by law, the Company assumes no obligation to update or
revise these forward-looking statements for any reason, even if new
information becomes available in the future.
Note regarding non-GAAP financial measures
This press release includes references to non-GAAP measures,
including the year over year percentage increase in net sales
(excluding the contribution of e.l.f. retail stores), adjusted
EBITDA, adjusted net income and adjusted diluted EPS. Please see
the table below for a quantitative reconciliation of net sales,
excluding the contribution of e.l.f. retail stores, for the 12
months ended March 31, 2019 (“Fiscal 2019”) to the corresponding
net sales GAAP measure for Fiscal 2019. The Company is not able to
provide a quantitative reconciliation of the adjusted EBITDA,
adjusted net income and adjusted diluted EPS non-GAAP measures in
this press release to the corresponding net income and diluted EPS
GAAP measures without unreasonable efforts. The Company cannot
provide meaningful estimates of the non-recurring charges and
credits excluded from these non-GAAP measures due to the
forward-looking nature of these estimates and their inherent
variability and uncertainty. For the same reasons, the Company is
unable to address the probable significance of the unavailable
information.
Reconciliation of GAAP net sales for Fiscal 2019 to non-GAAP
net sales for Fiscal 2019, excluding the contribution of e.l.f.
retail stores (unaudited)
(in thousands)
Fiscal 2019 Net Sales
Fiscal 2019 e.l.f. retail
stores Net Sales
Fiscal 2019 (excluding e.l.f.
retail stores) Net Sales
$
267,656
$
12,001
$
255,655
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200330005220/en/
Investors: Willa McManmon VP, IR and Corporate
Communications, e.l.f. Cosmetics (650) 960-5177
Media: Alecia Pulman ICR, Inc. (203) 682-8200
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