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The Container Store Group, Inc. (TCS) Tops Q1 EPS by 2c, Offers FY15 Guidance

July 7, 2015 4:08 PM

The Container Store Group, Inc. (NYSE: TCS) reported Q1 EPS of ($0.11), $0.02 better than the analyst estimate of ($0.13). Revenue for the quarter came in at $169.8 million versus the consensus estimate of $173.56 million.

Company comparable store sales for the first quarter of fiscal 2015 were down 0.9% compared to first quarter of fiscal 2014, exceeding the Company’s stated outlook for the first quarter of down 3% to 4%.

“Our first quarter financial performance exceeded our expectations, as we delivered better than forecasted comparable store sales and improved gross margin,” said Kip Tindell, Chairman and Chief Executive Officer. “The implementation of our three major strategic initiatives – TCS Closets, Contained Home and POP! – remains on track, as planned, and we’re encouraged by the start of the ‘snowballing effect’ on their results. As we expected, we’ve seen that, in general, our stores with the strongest comparable store sales increases are the ones that have had TCS Closets and Contained Home the longest. In fact, if we isolate our seven Dallas-area stores, TCS Closets alone added three percentage points of incremental comparable store sales to those stores in the first quarter of fiscal 2015. We remain confident in, and are maintaining, our previously stated sales and EPS outlook for the fiscal year.”

Outlook

For fiscal 2015, consolidated net sales are expected to be $800 to $815 million, based on the Company’s expected store openings and a comparable store sales change of -2% to 0%. Net income is expected to be $0.30 to $0.38 per diluted common share based on estimated diluted common shares outstanding of 49 million. This assumes a tax rate of approximately 39% for the full year. Adjusted EBITDA is expected to be between $85 and $91 million.

This outlook incorporates approximately $4.5 million of expenses, or $0.06 per diluted common share, associated with the implementation of the key strategic initiatives.

*** The Street sees FY15 EPS of $0.32 on revenue of $815.78 million.

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

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