The Container Store (TCS) Tops Q4 EPS by 8c, Beats on Revenues; Positive FY Revenue Outlook, Announces Optimization Plan

The Container Store Group (NYSE: TCS) reported Q4 EPS of $0.17, $0.08 better than the analyst estimate of $0.09. Revenue for the quarter came in at $221 million versus the consensus estimate of $214.73 million.

GUIDANCE:

The Container Store Group sees FY2017 revenue of $830-850 million, versus the consensus of $814.93 million.

Outlook

For fiscal 2017, consolidated net sales are expected to be $830 to $850 million, based on the Company’s four expected new store openings and a comparable store sales decrease in the low single digit range. Net income is expected to be $0.25* to $0.35* per common share based on estimated common shares outstanding of 49 million, and includes the aforementioned optimization plan charges and benefits. This assumes a tax rate of approximately 39% for the full year.

Optimization Plan

Today the Company is announcing the implementation of a four-part optimization plan to drive improved sales and profitability. This plan includes sales initiatives, certain full-time position eliminations at TCS, organizational realignment at Elfa and ongoing savings and efficiency efforts. The Company expects to incur pre-tax charges associated with the optimization plan of approximately $9 to $11 million in fiscal 2017, or $0.12 to $0.14 on a per share basis. The expected annualized pre-tax savings associated with the optimization plan are approximately $20 million, of which approximately $12 to $15 million, or $0.15 to $0.19 on a per share basis, is expected to be realized in fiscal 2017, for an estimated net benefit of approximately $0.03 to $0.05 on a per share basis.

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

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