Fourth Quarter Net Sales Increased 26%; Full
Year Increased 19% Fourth Quarter Gross Margin Expanded 530
Basis Points; Full Year Expanded 560 Basis Points Fourth
Quarter EPS of $0.71; Adjusted EPS of $0.74 Full Year EPS of
$1.77; Adjusted EPS of $1.87 Provides Fiscal Year 2021
Outlook
YETI Holdings, Inc. (“YETI”) (NYSE: YETI) today announced its
financial results for the fourth quarter and fiscal year ended
January 2, 2021. The 14-week fourth quarter and 53-week fiscal year
ended January 2, 2021 are compared to the 13-week fourth quarter
and 52-week fiscal year ended December 28, 2019.
YETI reports its financial performance in accordance with
accounting principles generally accepted in the United States of
America (“GAAP”) and as adjusted on a non-GAAP basis. Please see
“Non-GAAP Financial Information,” “Revised Non-GAAP Financial
Measures Beginning in Fiscal 2020,” and “Reconciliation of GAAP to
Non-GAAP Financial Information” below for additional information
and reconciliations of the non-GAAP financial measures to the most
comparable GAAP financial measures.
Matt Reintjes, President and Chief Executive Officer, commented,
“Our remarkable fourth quarter and full year performance reflects
the ongoing vitality and relevance of our brand with customers as
well as the incredible dedication of and strong execution by our
global employees. Our fourth quarter results were highlighted by
26% net sales growth, record gross margin of nearly 60% and over
$250 million in cash following an additional $100 million voluntary
debt payment at the end of the quarter. This strong quarter
culminated a year that saw YETI cross the $1 billion in net sales
milestone driven by 19% topline growth. Our revenue growth combined
with expanding margins generated over 75% adjusted EPS growth –
significantly ahead of our initial outlook during an unprecedented
year of disruptions and challenges.”
For the Three Months Ended January 2,
2021 (14 Week Period)
Net sales increased 26% to $375.8 million, compared to
$297.6 million during the same period last year.
- Direct-to-consumer (“DTC”) channel net sales increased 46% to
$217.8 million, compared to $149.0 million in the prior year
quarter, driven by strong performance in both Drinkware and Coolers
& Equipment. The DTC channel grew to 58% of net sales, compared
to 50% in the prior year period.
- Wholesale channel net sales increased 6% to $158.0 million,
compared to $148.7 million in the same period last year, driven by
both Drinkware and Coolers & Equipment.
- Drinkware net sales increased 23% to $235.7 million, compared
to $192.0 million in the prior year quarter, primarily driven by
the continued expansion of our Drinkware product offerings,
including the introduction of new colorways and sizes, and strong
demand for customization.
- Coolers & Equipment net sales increased 31% to $134.3
million, compared to $102.3 million in the same period last year,
driven by strong performance in soft coolers, hard coolers, outdoor
living products, and cargo.
Gross profit increased 39% to $224.8 million, or 59.8% of
net sales, compared to $162.3 million, or 54.5% of net sales, in
the fourth quarter of Fiscal 2019. The 530 basis point increase in
gross margin was primarily driven by a favorable mix shift to our
DTC channel, as well as product cost improvements, decreased
tariffs, and lower inbound freight.
Selling, general, and administrative (“SG&A”)
expenses decreased 5% to $143.4 million, compared to $150.4
million in the fourth quarter of Fiscal 2019. Excluding the impact
of the $40.7 million one-time non-cash stock-based compensation
expense related to pre-IPO performance-based awards recognized in
the prior period, SG&A expenses as a percentage of net sales
increased 130 basis points. Variable expenses increased 140 basis
points, driven by our faster growing and higher gross margin DTC
channel, which grew to 58% of net sales during the period.
Excluding the impact of the aforementioned one-time non-cash
stock-based compensation expense, non-variable expenses leveraged
10 basis points on higher net sales, including leverage on higher
expenditures in areas such as employee costs and distributions
expenses, partially offset by deleverage on higher marketing
expenses.
Operating income increased to $81.4 million, or 21.7% of
net sales, compared to $12.0 million, or 4.0% of net sales, during
the prior year quarter, which included the impact of the
aforementioned one-time stock-based compensation expense.
Adjusted operating income increased 57% to $84.5 million,
or 22.5% of net sales, compared to $54.0 million, or 18.1% of net
sales, during the same period last year.
Net income increased to $62.4 million, or 16.6% of net
sales, compared to $4.7 million, or 1.6% of net sales, in the prior
year quarter, which included the impact of the aforementioned
one-time stock-based compensation expense; Net income per
diluted share increased to $0.71, compared to $0.05 per diluted
share in the prior year quarter.
Adjusted net income increased 73% to $65.2 million, or
17.4% of net sales, compared to $37.8 million, or 12.7% of net
sales, in the prior year quarter; Adjusted net income per
diluted share increased 70% to $0.74, compared to $0.43 per
diluted share in the prior year quarter.
Adjusted EBITDA increased 52% to $94.0 million, or 25.0%
of net sales, from $61.8 million, or 20.8% of net sales, during the
same period last year.
For the Twelve Months Ended January 2,
2021 (53 Weeks)
Net sales increased 19% to $1,091.7 million, compared to
$913.7 million in the prior year.
- DTC channel net sales increased 50% to $580.9 million, compared
to $386.1 million in the prior year period, driven by both Coolers
& Equipment and Drinkware. The DTC channel grew to 53% of net
sales, compared to 42% in the prior year.
- Wholesale channel net sales decreased 3% to $510.9 million,
compared to $527.6 million in the same period last year, primarily
driven by Coolers & Equipment. The decline in wholesale channel
net sales was mainly driven by the effects of the COVID-19 pandemic
on temporary store closures during the first half of the year.
- Drinkware net sales increased 19% to $628.6 million, compared
to $526.2 million in the prior year period, primarily driven by the
continued expansion of our Drinkware product offerings, including
the introduction of new colorways and sizes, and strong demand for
customization.
- Coolers & Equipment net sales increased 21% to $446.6
million, compared to $368.9 million in the same period last year.
The strong performance was driven by growth in soft coolers, hard
coolers, outdoor living products, and cargo.
Gross profit increased 32% to $628.8 million, or 57.6% of
net sales, compared to $475.3 million, or 52.0% of net sales, in
the prior year. The 560 basis point increase in gross margin was
primarily driven by a favorable mix shift to our DTC channel as
well as product cost improvements, lower inbound freight, and
decreased tariffs.
Selling, general, and administrative (“SG&A”)
expenses increased 8% to $414.6 million, compared to $385.5
million in the prior year. Excluding the impact of the $40.7
million one-time non-cash stock-based compensation expense related
to pre-IPO performance-based awards recognized in the prior year,
SG&A expenses as a percentage of net sales increased 30 basis
points. Variable expenses increased 210 basis points, driven by our
faster growing and higher margin DTC channel, which grew to 53% of
net sales during the period. Excluding the impact of the
aforementioned one-time non-cash stock-based compensation expense,
non-variable expenses leveraged 180 basis point on higher net
sales, including leverage on higher expenditures in areas such as
employee costs, non-cash stock-based compensation expense, and
marketing expenses, partially offset by deleverage on higher
distribution costs.
Operating income increased 139% to $214.2 million, or
19.6% of net sales, compared to $89.8 million, or 9.8% of net
sales, during the prior year, which included the impact of the
aforementioned stock-based compensation expense.
Adjusted operating income increased 57% to $224.3
million, or 20.5% of net sales, compared to $142.7 million, or
15.6% of net sales, during the same period last year.
Net income increased 209% to $155.8 million, or 14.3% of
net sales, compared to $50.4 million, or 5.5% of net sales, in the
prior year, which included the impact of the aforementioned
stock-based compensation expense; Net income per diluted
share increased 204% to $1.77, compared to $0.58 per diluted
share in the prior year.
Adjusted net income increased 79% to $164.2 million, or
15.0% of net sales, compared to $91.8 million, or 10.0% of net
sales in the prior year period; Adjusted net income per diluted
share increased 76% to $1.87, compared to $1.06 per diluted
share in the same period last year.
Adjusted EBITDA increased 49% to $256.0 million, or 23.5%
of net sales, from $171.6 million, or 18.8% of net sales, during
the prior year.
Balance Sheet and Cash Flow
Highlights
Cash increased to $253.3 million, compared to $72.5
million at the end of Fiscal 2019.
Inventory decreased 25% to $140.1 million, compared to
$185.7 million at the end of Fiscal 2019. During the final weeks of
the first quarter of 2020, YETI took decisive actions in response
to government mandates and retail store closures due to the
COVID-19 pandemic by reducing purchase orders to align with demand
forecasts at the time and to provide enhanced financial
flexibility. This disruption and the overall strong demand during
2020 contributed to the inventory decline during the fourth
quarter. YETI continues to work to replenish its distribution
channels to meet customer demand throughout Fiscal 2021.
Total debt, excluding finance leases and unamortized
deferred financing fees, was $135.0 million, compared to $300.0
million at the end of the Fiscal 2019. During Fiscal 2020, YETI
made mandatory and voluntary debt payments of $15.0 million and
$150.0 million, respectively, and fully repaid the precautionary
first quarter borrowings of $50.0 million under its revolving
credit facility. Accordingly, at the end of Fiscal 2020, we had no
outstanding borrowings and $150.0 million available for borrowing
under our revolving credit facility. At the end of the quarter, our
cash balance exceeded total debt by $118.3 million.
Cash flow provided by operating activities was $366.4
million, compared to $86.9 million for the twelve months ended
December 28, 2019. Capital expenditures were $15.6 million,
compared to $32.1 million during the same period last year.
Mr. Reintjes added, “Demand for YETI was strong before the onset
of the pandemic and remained robust as global consumers adjusted to
new work and life habits highlighted by interest in outdoor
pursuits, behaviors that we expect will continue this year. Looking
forward, we believe YETI is uniquely positioned to capitalize as
consumers begin to re-engage in pre-pandemic activities such as
commuting, social gatherings, and sports activities at all levels.
This confidence is reflected in our topline outlook of 15% to 17%
growth for 2021 – on top of our incredible performance in 2020 and
above our long-term target. To further adapt to these consumer
evolutions, we remain steadfast in investing across our strategic
priorities to ensure we are driving our long-term sustainable
global growth aspirations.”
Fiscal 2021 Outlook
For Fiscal 2021, a 52-week period, compared to a 53-week period
in Fiscal 2020, YETI expects:
- Net sales to increase between 15% and 17% with sales
growth weighted to the first half of the year;
- Operating income as a percentage of net sales of
approximately 18.5%;
- Adjusted operating income as a percentage of net
sales of approximately 20.0%;
- An effective tax rate of approximately 24.5%;
- Net income per diluted share to be between $1.95 and
$1.98, reflecting a 10% to 12% increase, with earnings growth
heavily weighted to the first and fourth quarter;
- Adjusted net income per diluted share between $2.11 and
$2.14, reflecting a 13% to 15% increase, with earnings growth
heavily weighted to the first and fourth quarter;
- Diluted weighted average shares outstanding of
approximately 88.6 million; and
- Capital expenditures between $55 million and $60
million, primarily to support investments in technology and new
product innovation and launches.
Conference Call Details A conference call to discuss the
fourth quarter of Fiscal 2020 financial results is scheduled for
today, February 11, 2021, at 8:00 a.m. Eastern Time. Investors and
analysts interested in participating in the call are invited to
dial 877-451-6152 (international callers, please dial 201-389-0879)
approximately 10 minutes prior to the start of the call. A live
audio webcast of the conference call will be available online at
http://investors.yeti.com and by dialing 844-512-2921 and entering
the access code 13714657. A replay will be available through
February 25, 2021.
About YETI Holdings, Inc. Headquartered in Austin, Texas,
YETI is a global designer, retailer, and distributor of innovative
outdoor products. From coolers and drinkware to backpacks and bags,
YETI products are built to meet the unique and varying needs of
diverse outdoor pursuits, whether in the remote wilderness, at the
beach, or anywhere life takes our customers. By consistently
delivering high-performing, exceptional products, we have built a
strong following of brand loyalists throughout the world, ranging
from serious outdoor enthusiasts to individuals who simply value
products of uncompromising quality and design. We have an
unwavering commitment to outdoor and recreation communities, and we
are relentless in our pursuit of building superior products for
people to confidently enjoy life outdoors and beyond. For more
information, please visit www.YETI.com.
Non-GAAP Financial Measures This press release includes
financial measures that are not defined by GAAP, including adjusted
operating income, adjusted net income, adjusted net income per
diluted share, and adjusted EBITDA. We define adjusted operating
income and adjusted net income as operating income and net income,
respectively, adjusted for non-cash stock-based compensation
expense, asset impairment charges, and, in the case of adjusted net
income, also adjusted for the loss on modification and
extinguishment of debt, including accelerated amortization of
deferred financing fees resulting from early prepayments of debt,
and the tax impact of all adjustments. Adjusted net income per
share is calculated using adjusted net income, as defined above,
and diluted weighted average shares outstanding. We define adjusted
EBITDA as net income before interest expense, net, provision for
income taxes and depreciation and amortization, adjusted for the
impact of certain other items, including: non-cash stock-based
compensation expense; asset impairment charges; and loss on
modification and extinguishment of debt, including accelerated
amortization of deferred financing fees resulting from the early
prepayment of debt. Beginning in Fiscal 2021, we will adjust our
non-GAAP financial measures to add back costs related to the
start-up costs, transition and integration charges associated with
our new distribution facility in Memphis, Tennessee, and costs to
exit our distribution facility in Dallas, Texas.
Adjusted operating income, adjusted net income, adjusted net
income per diluted share, and adjusted EBITDA are not defined by
GAAP and may not be comparable to similarly titled measures
reported by other entities. We use these non-GAAP measures, along
with GAAP measures, as a measure of profitability. These measures
help us compare our performance to other companies by removing the
impact of the effect of operating in different tax jurisdictions;
the impact of our asset base, which can vary depending on the book
value of assets and methods used to compute depreciation and
amortization; the effect of non-cash stock-based compensation
expense, which can vary based on plan design, share price, share
price volatility, and the expected lives of equity instruments
granted; as well as certain expenses that we do not believe are
indicative of our ongoing or underlying operating performance. We
also disclose adjusted operating income, adjusted net income, and
adjusted EBITDA as a percentage of net sales to provide a measure
of relative profitability.
We believe that these non-GAAP measures, when reviewed in
conjunction with GAAP financial measures, and not in isolation or
as substitutes for analysis of our results of operations under
GAAP, are useful to investors as they are widely used measures of
performance and the adjustments we make to these non-GAAP measures
provide investors further insight into our profitability and
additional perspectives in comparing our performance to other
companies and in comparing our performance over time on a
consistent basis. Adjusted operating income, adjusted net income,
and adjusted EBITDA have limitations as profitability measures in
that they do not include the interest expense on our debts, our
provisions for income taxes, and the effect of our expenditures for
capital assets and certain intangible assets. In addition, all of
these non-GAAP measures have limitations as profitability measures
in that they do not include the effect of non-cash stock-based
compensation expense, the effect of asset impairments, and loss on
modification and extinguishment of debt. Because of these
limitations, we rely primarily on our GAAP results.
In the future, we may incur expenses similar to those for which
adjustments are made in calculating adjusted operating income,
adjusted net income, and adjusted EBITDA. Our presentation of these
non-GAAP measures should not be construed as a basis to infer that
our future results will be unaffected by extraordinary, unusual or
non-recurring items.
Revised Non-GAAP Financial Measures Beginning in Fiscal
2020 As previously disclosed, following YETI’s initial full
year as a public company and beginning with the first quarter of
Fiscal 2020, YETI revised its definitions of certain non-GAAP
financial measures by eliminating various adjustments. These
revisions are intended to align with how management will evaluate
the performance of the business going forward. Specifically, YETI
no longer includes adjustments for investments in new retail
locations and international market expansion, transition to the
ongoing senior management team, and transition to a public
company.
YETI has recast its historical 2019 non-GAAP financial measures
to conform to the revised definitions on its investor relations
website at http://investors.yeti.com.
Forward-looking statements This press release contains
‘‘forward-looking statements’’ within the meaning of the Private
Securities Litigation Reform Act of 1995. All statements other than
statements of historical or current fact included in this press
release are forward-looking statements. Forward-looking statements
include statements containing words such as “anticipate,” “assume,”
“believe,” “can have,” “contemplate,” “continue,” “could,”
“design,” “due,” “estimate,” “expect,” “forecast,” “goal,”
“intend,” “likely,” “may,” “might,” “objective,” “plan,” “predict,”
“project,” “potential,” “seek,” “should,” “target,” “will,”
“would,” and other words and terms of similar meaning in connection
with any discussion of the timing or nature of future operational
performance or other events. For example, all statements relating
to our expectations for opportunity or growth, including those set
forth in the quote from YETI’s President and CEO, and the Fiscal
2021 financial outlook provided herein, constitute forward-looking
statements. All forward-looking statements are subject to risks and
uncertainties that may cause actual results to differ materially
from those that are expected and, therefore, you should not unduly
rely on such statements. The risks and uncertainties that could
cause actual results to differ materially from those expressed or
implied by these forward-looking statements include but are not
limited to: (i) uncertainty regarding global economic conditions,
particularly the uncertainty related to the duration and impact of
the rapidly evolving COVID-19 pandemic, including its impact on
global economic conditions; (ii) our ability to maintain and
strengthen our brand and generate and maintain ongoing demand for
our products; (iii) our ability to successfully design, develop and
market new products; (iv) our ability to effectively manage our
growth; (v) our ability to expand into additional consumer markets,
and our success in doing so; (vi) the success of our international
expansion plans; (vii) our ability to compete effectively in the
outdoor and recreation market and protect our brand; (viii) the
level of customer spending for our products, which is sensitive to
general economic conditions and other factors; (ix) problems with,
or loss of, our third-party contract manufacturers and suppliers,
or an inability to obtain raw materials; (x) fluctuations in the
cost and availability of raw materials, equipment, labor, and
transportation and subsequent manufacturing delays or increased
costs; (xi) our ability to accurately forecast demand for our
products and our results of operations; (xii) our relationships
with our national, regional, and independent retail partners, who
account for a significant portion of our sales; (xiii) the impact
of natural disasters and failures of our information technology on
our operations and the operations of our manufacturing partners;
(xiv) our ability to attract and retain skilled personnel and
senior management, and to maintain the continued efforts of our
management and key employees; and (xv) the impact of our
indebtedness on our ability to invest in the ongoing needs of our
business. You should read our filings with the United States
Securities and Exchange Commission (the “SEC”), including our
Annual Report on Form 10-K for the year ended December 28, 2019 and
our Quarterly Reports on Form 10-Q for the quarters ended March 28,
2020, June 27, 2020, and September 26, 2020, for a more extensive
list of factors, that may be amended, supplemented or superseded
from time to time by other reports YETI files with the SEC, that
could affect results. These forward-looking statements are made
based upon detailed assumptions and reflect management’s current
expectations and beliefs. While YETI believes that these
assumptions underlying the forward-looking statements are
reasonable, YETI cautions that it is very difficult to predict the
impact of known factors, and it is impossible for YETI to
anticipate all factors that could affect actual results.
The forward-looking statements included here are made only as of
the date hereof. YETI undertakes no obligation to publicly update
or revise any forward-looking statement as a result of new
information, future events, or otherwise, except as required by
law. Many of the foregoing risks and uncertainties may be
exacerbated by the COVID-19 pandemic and any worsening of the
global business and economic environment as a result.
YETI HOLDINGS, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per
share amounts)
Three Months Ended
Twelve Months Ended
January 2, 2021
December 28,
2019
January 2, 2021
December 28,
2019
Net sales
$
375,768
$
297,602
$
1,091,721
$
913,734
Cost of goods sold
150,924
135,268
462,918
438,420
Gross profit
224,844
162,334
628,803
475,314
Selling, general, and administrative
expenses
143,418
150,352
414,570
385,543
Operating income
81,426
11,982
214,233
89,771
Interest expense
(1,425
)
(4,698
)
(9,155
)
(21,779
)
Other income (expense)
1,143
(542)
123
(734)
Income before income taxes
81,144
6,742
205,201
67,258
Income tax expense
(18,750
)
(2,000
)
(49,400
)
(16,824
)
Net income
$
62,394
$
4,742
$
155,801
$
50,434
Net income per share
Basic
$
0.72
$
0.05
$
1.79
$
0.59
Diluted
$
0.71
$
0.05
$
1.77
$
0.58
Weighted-average common shares
outstanding
Basic
87,102
86,291
86,978
85,088
Diluted
88,320
86,930
87,847
86,347
YETI HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(Unaudited)
(In thousands, except per
share amounts)
January 2, 2021
December 28,
2019
ASSETS
Current assets
Cash
$
253,283
$
72,515
Accounts receivable, net
65,417
82,688
Inventory
140,111
185,700
Prepaid expenses and other current
assets
17,686
19,644
Total current assets
476,497
360,547
Property and equipment, net
78,075
82,610
Operating lease right-of-use assets
34,090
37,768
Goodwill
54,293
54,293
Intangible assets, net
92,078
90,850
Deferred income taxes
1,062
1,082
Deferred charges and other assets
972
2,389
Total assets
$
737,067
$
629,539
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities
Accounts payable
$
123,621
$
83,823
Accrued expenses and other current
liabilities
89,068
42,088
Taxes payable
18,316
3,329
Accrued payroll and related costs
25,810
18,119
Operating lease liabilities
8,247
7,768
Current maturities of long-term debt
22,697
15,185
Total current liabilities
287,759
170,312
Long-term debt, net of current portion
111,017
281,715
Operating lease liabilities,
non-current
36,546
42,200
Other liabilities
13,327
13,307
Total liabilities
448,649
507,534
Commitments and contingencies
Stockholders’ Equity
Common stock, par value $0.01; 600,000
shares authorized; 87,128 and 86,774 shares outstanding at January
2, 2021 and December 28, 2019, respectively
871
868
Preferred stock, par value $0.01; 30,000
shares authorized; no shares issued or outstanding
—
—
Additional paid-in capital
321,678
310,678
Accumulated deficit
(33,744
)
(189,545
)
Accumulated other comprehensive (loss)
income
(387
)
4
Total stockholders’ equity
288,418
122,005
Total liabilities and stockholders’
equity
$
737,067
$
629,539
YETI HOLDINGS, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands, except per
share amounts)
Twelve Months Ended
January 2, 2021
December 28,
2019
Cash Flows from Operating
Activities:
Net income
$
155,801
$
50,434
Adjustments to reconcile net income to
cash provided by operating activities:
Depreciation and amortization
30,535
28,959
Amortization of deferred financing
fees
935
2,189
Stock-based compensation
9,009
52,332
Deferred income taxes
(3,827
)
15,615
Other
(74)
—
Impairment of long-lived assets
1,051
616
Loss on prepayment, modification, or
extinguishment of debt
1,064
643
Changes in operating assets and
liabilities:
Accounts receivable, net
16,353
(19,940
)
Inventory
46,052
(40,541
)
Other current assets
1,982
(6,798
)
Accounts payable and accrued expenses
89,125
6,614
Taxes payable
14,943
(3,101
)
Other
3,478
(129
)
Net cash provided by operating
activities
366,427
86,893
Cash Flows from Investing
Activities:
Purchases of property and equipment
(15,566
)
(32,077
)
Additions of intangibles, net
(7,378
)
(16,614
)
Net cash used in investing activities
(22,944
)
(48,691
)
Cash Flows from Financing
Activities:
Borrowings under revolving line of
credit
50,000
—
Repayments under revolving line of
credit
(50,000
)
—
Repayments of long-term debt
(165,000
)
(34,875
)
Proceeds from employee stock
transactions
3,022
3,561
Taxes paid in connection with employee
stock transactions
(1,028
)
(13,516
)
Finance lease principal payment
(185
)
(74
)
Proceeds from borrowings on Term Loan A in
connection with amendment
—
66,238
Repayments of Term Loan A in connection
with amendment
—
(64,250
)
Payments of deferred financing fees
—
(2,135
)
Dividends
—
(636
)
Net cash used in financing activities
(163,191
)
(45,687
)
Effect of exchange rate changes on
cash
476
(51
)
Net increase (decrease) in cash
180,768
(7,536
)
Cash, beginning of period
72,515
80,051
Cash, end of period
$
253,283
$
72,515
YETI HOLDINGS, INC.
SELECTED FINANCIAL
DATA
Reconciliation of GAAP to
Non-GAAP Financial Information
(Unaudited) (In thousands
except per share amounts)
Three Months Ended
Twelve Months Ended
January 2, 2021
December 28,
2019
January 2, 2021
December 28,
2019
Operating income
$
81,426
$
11,982
$
214,233
$
89,771
Adjustments:
Non-cash stock-based compensation
expense(1)(2)
2,694
41,933
9,009
52,332
Long-lived asset impairment(1)
419
76
1,051
616
Adjusted operating income
$
84,539
$
53,991
$
224,293
$
142,719
Net income
$
62,394
$
4,742
$
155,801
$
50,434
Adjustments:
Non-cash stock-based compensation
expense(1)(2)
2,694
41,933
9,009
52,332
Long-lived asset impairment(1)
419
76
1,051
616
Loss on prepayment, modification, and
extinguishment of debt(3)
646
643
1,064
643
Tax impact of adjusting items(4)
(921
)
(9,580
)
(2,725
)
(12,260
)
Adjusted net income
$
65,232
$
37,814
$
164,200
$
91,765
Net income
$
62,394
$
4,742
$
155,801
$
50,434
Adjustments:
Interest expense
1,425
4,698
9,155
21,779
Income tax expense
18,750
2,000
49,400
16,824
Depreciation and amortization
expense(5)
7,700
7,739
30,535
28,959
Non-cash stock-based compensation
expense(1)(2)
2,694
41,933
9,009
52,332
Long-lived asset impairment(1)
419
76
1,051
616
Loss on prepayment, modification, and
extinguishment of debt(3)
646
643
1,064
643
Adjusted EBITDA
$
94,028
$
61,831
$
256,015
$
171,587
Net sales
$
375,768
$
297,602
$
1,091,721
$
913,734
Operating income as a % of net sales
21.7
%
4.0
%
19.6
%
9.8
%
Adjusted operating income as a % of net
sales
22.5
%
18.1
%
20.5
%
15.6
%
Net income as a % of net sales
16.6
%
1.6
%
14.3
%
5.5
%
Adjusted net income as a % of net
sales
17.4
%
12.7
%
15.0
%
10.0
%
Adjusted EBITDA as a % of net sales
25.0
%
20.8
%
23.5
%
18.8
%
Net income per diluted share
$
0.71
$
0.05
$
1.77
$
0.58
Adjusted net income per diluted share
$
0.74
$
0.43
$
1.87
$
1.06
Weighted average common shares outstanding
- diluted
88,320
86,930
87,847
86,347
____________________
(1)
These costs are reported in SG&A
expenses.
(2)
Includes $40.7 million of one-time
non-cash stock-based compensation expense related to pre-IPO
restricted stock units (“PRSUs”) that vested and were fully
recognized during the three and twelve months ended December 28,
2019. The vesting of the PRSUs was triggered when Cortec ceased to
own more than 35% of the voting power of our outstanding common
stock following the closing of our November 2019 secondary
offering.
(3)
Represents the accelerated amortization of
deferred financing fees resulting from the voluntary prepayments of
our term loan in Fiscal 2020 and the loss on modification and
extinguishment related to the amendment of our credit facility in
Fiscal 2019.
(4)
Represents the tax impact of adjustments
calculated at an expected statutory tax rate of 24.5% and 22.5% for
the three months ended January 2, 2021 and December 28, 2019,
respectively. For the twelve months ended January 2, 2021 and
December 28, 2019, the tax rate used to calculate the tax impact of
adjustments was 24.5% and 22.9%, respectively. The tax impact of
adjustments for the three and twelve months ended December 28, 2019
is net of a $0.9 million discrete income tax expense related to the
recognition of $40.7 million one-time non-cash stock-based
compensation expense associated with pre-IPO PRSUs that vested and
were fully recognized during the three and twelve months ended
December 28, 2019.
(5)
Depreciation and amortization expenses are
reported in SG&A expenses and cost of goods sold.
Fiscal 2021 OUTLOOK
Reconciliation of GAAP to
Non-GAAP Financial Information
(Unaudited)
(In thousands except per share
amounts)
Twelve Months Ended
Fiscal 2021 Outlook
January 2, 2021
Low
High
Operating income
$
214,233
$
232,311
$
236,678
Adjustments:
Non-cash stock-based compensation
expense(1)
9,009
16,228
16,228
Long-lived asset impairment(1)
1,051
—
—
Business optimization expense(1)(2)
—
2,556
2,556
Adjusted operating income
$
224,293
$
251,095
$
255,462
Net income
$
155,801
$
172,380
$
175,668
Adjustments:
Non-cash stock-based compensation
expense(1)
9,009
16,228
16,228
Business optimization expense(1)(2)
—
2,556
2,556
Long-lived asset impairment(1)
1,051
—
—
Loss on prepayment of debt(3)
1,064
—
—
Tax impact of adjusting items(4)
(2,725
)
(4,602
)
(4,602
)
Adjusted net income
$
164,200
$
186,562
$
189,850
Net sales
$
1,091,721
$
1,255,479
$
1,277,313
Operating income as a % of net sales
19.6
%
18.5
%
18.5
%
Adjusted operating income as a % of net
sales
20.5
%
20.0
%
20.0
%
Net income as a % of net sales
14.3
%
13.7
%
13.8
%
Adjusted net income as a % of net
sales
15.0
%
14.9
%
14.9
%
Net income per diluted share
$
1.77
$
1.95
$
1.98
Adjusted net income per diluted share
$
1.87
$
2.11
$
2.14
Weighted average common shares outstanding
- diluted
87,847
88,564
88,564
____________________
(1)
These costs are reported in SG&A
expenses.
(2)
Represents start-up costs, transition and
integration charges associated with our new distribution facility
in Memphis, Tennessee, and costs to exit our distribution facility
in Dallas, Texas.
(3)
Represents the accelerated amortization of
deferred financing fees resulting from the voluntary prepayments of
our term loan in Fiscal 2020.
(4)
Represents tax impact of adjustments
calculated at an expected statutory tax rate of 24.5% for both
Fiscal 2020 and Fiscal 2021.
(5)
Depreciation and amortization expenses are
reported in SG&A expenses and cost of goods sold.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210211005221/en/
Investor Relations Contact: Tom Shaw, 512-271-6332
Investor.relations@yeti.com
Media Contact: YETI Holdings, Inc. Media Hotline
Media@yeti.com
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