The Container Store Group (TCS) Misses Q2 EPS by 1c, Maintains FY Guidance

The Container Store Group (NYSE: TCS) reported Q2 EPS of $0.06, $0.01 worse than the analyst estimate of $0.07. Revenue for the quarter came in at $195.5 million versus the consensus estimate of $197.71 million.

Comparable store sales for the second quarter of fiscal 2015 were up 0.1% compared to the second quarter of fiscal 2014.

The Container Store Group sees FY2015 EPS of $0.30-$0.38, versus the consensus of $0.34. The Container Store Group sees FY2015 revenue of $800-815 million, versus the consensus of $809.87 million.

Our sales performance in the second quarter exceeded our expectations with positive comparable store sales, a result of even more strategic customer engagement and service initiatives, coupled with the ‘snowballing effect’ of our major initiatives,” said Kip Tindell, Chairman and Chief Executive Officer. “The benefit from TCS Closets to our comparable store sales more than doubled from the first quarter to second quarter of fiscal 2015.”

Tindell continued, “I am proud of the solid execution across our entire organization during the ongoing rollout of our major strategic initiatives, including TCS Closets and Contained Home. With initiatives of this magnitude and complexity, we believe it is vitally important to make the appropriate investments in order to ensure their future success. We remain on track for the full rollout of our initiatives by the end of fiscal 2015, and with each market’s launch we continue to improve our visual displays, training and selling processes, allowing us to further leverage our investments to date. We have streamlined the path to purchase options for TCS Closets, which has already increased our capacity and shortened the turnaround time for custom closet orders by approximately 28% from first quarter to second quarter of fiscal 2015.”

An evolution of the Company’s customer engagement strategy also continues, with even more compelling, relevant and strategic communications based on a customer’s individual purchase behavior and lifestyle. These ongoing test and learn customer touch points are allowing the Company to further improve the effectiveness of its customer engagement efforts in order to maximize sales and profitability.

“Our intense and ongoing focus on solutions-based selling and the number of units sold in each transaction also continues to become more and more impactful and is another driver of our second quarter sales increase,” Tindell concluded.

It narrowing its outlook for change in comparable store sales for fiscal 2015 to -1% to 0% from the previously provided -2% to 0%.

For earnings history and earnings-related data on The Container Store Group (TCS) click here.

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