-=Michaels Stores (MIK) to be taken private in $3.3 billion deal

 

Arts-and-crafts retailer Michaels Stores and funds managed by affiliates of Apollo Global Management (APO) announce that they have entered into a definitive merger agreement pursuant to which investment funds managed by affiliates of Apollo have agreed to acquire the Company in a transaction that values Michaels at an equity value of approximately $3.3 bln

Under the terms of the agreement, which has been unanimously approved by the Michaels Board of Directors, Apollo will commence a tender offer to acquire all outstanding shares of Michaels for $22.00 per share in cash. The purchase price represents a 47% premium to the closing stock price on February 26, 2021 of $15.00 per share and a 78% premium to the 90-day volume-weighted average price.

The closing of the transaction is expected to close in Michaels' first half of the Company's fiscal year. Following the successful completion of the tender offer, Apollo managed funds will acquire all remaining shares not tendered in the tender offer through a second-step merger at the same price. The transaction will be financed through a combination of equity provided by Apollo managed funds as well as a committed debt financing package to be provided by Credit Suisse, Barclays, Wells Fargo, RBC Capital Markets, Deutsche Bank, Mizuho, and Bank of America.

Upon the completion of the transaction, Michaels will become a privately held company and shares of MIK common stock will no longer be listed on any public market.

Transaction valued at $5.0 bln.

-=Michaels Stores (MIK) reported earnings on Thur 3 Dec 20 (b/o)

 

Michaels Stores beats by $0.27, beats on revs; Q3 comps +16.3%; not providing guidance

Reports Q3 (Oct) earnings of $0.86 per share, excluding non-recurring items, $0.27 better than the S&P Capital IQ Consensus of $0.59; revenues rose 15.1% year/year to $1.41 bln vs the $1.39 bln S&P Capital IQ Consensus.

The 15.1% increase in sales for the third quarter of fiscal 2020 compared to the same period in the prior year was due to a 16.3% increase in comparable store sales and sales related to additional stores opened (net of closures) since the end of the third quarter of fiscal 2019, partially offset by a sales decline due to the closure of our wholesale business. "

Given the continued uncertainty due to the COVID-19 pandemic, including a dynamic and uncertain outlook for consumer spending patterns and associated government policies, the Company is not providing any formal guidance at this time.

=Michaels Stores (MIK) reported earnings on Wed 4 Sept 19 (b/o)

Michaels Stores beats by $0.05, beats on revs; guides Q3 EPS above consensus; raises FY20 EPS/comps guidance; lowers FY20 revenue guidance; Q2 comps +0.3%

Reports Q2 (Jul) earnings of $0.19 per share, excluding non-recurring items, $0.05 better than the S&P Capital IQ Consensus of $0.14; revenues fell 1.9% year/year to $1.03 bln vs the $1.02 bln S&P Capital IQ Consensus.

Comparable store sales increased 0.3%

Co issues upside guidance for Q3, sees EPS of $0.46-0.51, excluding non-recurring items, vs. $0.46 S&P Capital IQ Consensus. Q3 omparable store sales to be flat to up 1.0%

Co issues in-line guidance for FY20, lowers EPS to $2.31-2.42 from $2.29-2.41, excluding non-recurring items, vs. $2.34 S&P Capital IQ Consensus; sees FY20 revs of $5.16-5.19 bln from $5.19-5.24 bln vs. $5.19 bln S&P Capital IQ Consensus. FY20 Comparable store sales will be approximately flat (prior guidance flat to down 1.5%)

Earnings this week : Sept 2 - 6, 19 (wk 36)

Monday (Sept 2)

• Labor Day Holiday

Tuesday (Sept 3)

• Morning: CONN NSSC TUFN
• Afternoon: COUP EGAN GSM HQY

Wednesday (Sept 4)

• Morning: AEO MIK  NAV VRA
• Afternoon: AVAV HOME CLDR CPRT DSGX MDB PANW PVTL REVG WORK SMAR VRNT

Thursday (Sept 5)

• Morning: BITA CIEN DCI GIII JW.A KIRK LE LVGO MDP SCWX SIG
• Afternoon: ABM CDMO CRWD DOCU DOMO GWRE KFY LULU MDLA PD NX SAIC ZM ZUMZ

Friday (Sept 6) 

• Morning: BRC GCO

Notable earnings reports:

• Coupa Software (NASDAQ:COUP) on September 3; Slack Technologies (WORK), Palo Alto Networks (NYSE:PANW), MongoDB (NASDAQ:MDB), Cloudera (NYSE:CLDR) and Pivotal Software (NYSE:PVTL) on September 4; Lululemon (LULU), DocuSign (NASDAQ:DOCU), Signet Jewelers (NYSE:SIG) and Zoom Video (NASDAQ:ZM) on September 5; Brady (NYSE:BRC) on September 6.

=Michaels Stores (MIK) earnings on Tue 19 March 19 (b/o)

Michaels Stores beats by $0.02, reports revs in-line; Q4 comps -0.4%; guides Q1 EPS below consensus; guides FY20 EPS below consensus, revs below consensus

• Reports Q4 (Jan) earnings of $1.44 per share, excluding non-recurring items, $0.02 better than the S&P Capital IQ Consensus of $1.42; revenues fell 5.4% year/year to $1.79 bln vs the $1.78 bln S&P Capital IQ Consensus.  The decrease in net sales in the fourth quarter of fiscal 2018 was primarily due to the extra week in the fourth quarter of fiscal 2017, the closure of all 94 full-size Aaron Brothers stores in the first quarter of fiscal 2018, and a 0.4% decline (flat on a constant currency basis) in comparable store sales.
• Co issues downside guidance for Q1, sees EPS of $0.28-0.33 vs. $0.40 S&P Capital IQ Consensus. Co expects Q1 comps will decrease in the low-single-digit range.
• Co issues downside guidance for FY20, sees EPS of $2.34-2.46 vs. $2.48 S&P Capital IQ Consensus; sees FY20 revs of $5.19-5.24 bln vs. $5.25 bln S&P Capital IQ Consensus. Co sees FY20 comparable store sales to increase between 0% and 1%.

=Michaels Stores (MIK) reported earnings on Wed 13 June 18 (a/h)

Michaels Stores beats by $0.01, reports revs in-line, comps +0.4%; guides Q2 EPS below consensus; reaffirms FY19 guidance 

• Reports Q1 (Apr) earnings of $0.39 per share, excluding non-recurring items, $0.01 better thanthe Capital IQ Consensus of $0.38; revenues fell 0.3% year/year to $1.16 bln vs the $1.15 bln Capital IQ Consensus.
• Comparable store sales increased 0.4% (flat on a constant currency basis) due to an increase in average ticket, partially offset by a decrease in customer transactions.
• Co issues downside guidance for Q2, sees EPS of $0.12-0.14, excluding non-recurring items, vs. $0.19 Capital IQ Consensus Estimate; expects comparable store sales to be approximately flat;
• Co reaffirms guidance for FY19, sees EPS of $2.19-2.32, excluding non-recurring items, vs. $2.32 Capital IQ Consensus Estimate; sees FY19 revs of $5.217-5.293 bln vs. $5.26 bln Capital IQ Consensus Estimate; continues to expect comparable store sales to increase between 0% and 1.5%. 

Earnings this week : June 11- 15, 18 (wk 24)

Monday (June 11)

• Premarket: YTRA
• After hours: PLAY, KMG, RH

Tuesday (June 12)

• Premarket: CASY, JW.A, LE
• After hours: HRB, OXM, PVTL, SAIC

Wednesday (June 13)

• Premarket: BITA, KFY
• After hours: TLRD

Thursday (June 14)

• Premarket: MIK
• After hours: FNSR, JBL

Friday (June 15)

• Premarket: GOOS

 

=Michaels Stores (MIK) reported earnings on Thur 22 March 18 (b/o)

Michaels Stores beats by $0.01, reports revs in-line; guides Q1 EPS below consensus, revs below consensus; guides FY19 EPS below consensus, revs below consensus 

• Reports Q4 (Jan) earnings of $1.19 per share, excluding non-recurring items, $0.01 better than the Capital IQ Consensus of $1.18; revenues rose 8.0% year/year to $1.89 bln vs the $1.88 bln Capital IQ Consensus.
  • Comparable store sales increased 2.5%
• Co issues downside guidance for Q1, sees EPS of $0.36-0.38 vs. $0.46 Capital IQ Consensus Estimate; sees Q1 revs of $1.14-1.15 bln vs. $1.18 bln Capital IQ Consensus Estimate.
• Co issues downside guidance for FY19, sees EPS of $2.19-2.32 vs. $2.59 Capital IQ Consensus Estimate; sees FY19 revs of $5.22-5.29 bln vs. $5.37 bln Capital IQ Consensus Estimate.
• Aaron Brothers Store Closings
  • The Company has completed its strategic review of Aaron Brothers, a small, specialty retail chain primarily focused on custom framing, ready-made frames, wall art and art supplies. In 2018, the Company plans to close 94 full-size Aaron Brothers stores and reposition Aaron Brothers as a "store-within-a-store," providing custom framing services in all Michaels stores. The Company will also rebrand Framerspointe.com, a company-owned online custom framing website, as AaronBrothers.com.
  • In fiscal 2017, Aaron Brothers net sales totaled approximately $110 million and had no material impact on the Company's operating income. The Company expects the after-tax cost of implementing these changes will be in the range of $37 million to $42 million. The Company anticipates the vast majority of the cost will be recognized in the first quarter of fiscal 2018. The Company expects the after-tax cash impact of the changes to be minimal.

=Michaels Stores (MIK) reported earnings on Thur 30 Nov 2017 (b/o)

Michaels Stores beats by $0.01, misses on revs; guides Q4 EPS in-line 

• Reports Q3 (Oct) earnings of $0.44 per share, $0.01 better thanthe Capital IQ Consensus of $0.43; revenues rose 1.1% year/year to $1.24 bln vs the $1.26 bln Capital IQ Consensus inclusive of an estimated $10 million in lost sales related to Hurricanes Harvey and Irma. The increase in net sales was primarily a result of a 1.0% increase in comparable store sales (0.5% on a constant currency basis), and sales from the operation of 16 new Michaels stores (net of closures) in fiscal 2017. As expected, this increase was partially offset by lower wholesale revenues. Gross profit increased 3.8% to $484.1 million, from $466.6 million in the third quarter of fiscal 2016. As a percentage of net sales, gross profit increased 100 basis points to 39.0%
• Co issues in-line guidance for Q4, sees EPS of $1.15-1.18 vs. $1.16 Capital IQ Consensus; comparable store sales to increase 1.5% to 2.5%, or 1.0% to 2.0% on a constant currency basis; to open one new Michaels store and close four Aaron Brothers stores; operating income to be between $354 million and $364 million.
• "We are pleased we delivered third quarter operating income in-line with our guidance and diluted EPS above our guidance. We are seeing nice momentum in our business, excluding the disruption from the hurricanes, and we are encouraged by the customer's response to the improvements we have made, both in-stores and online, to make it easier for customers to MAKE," said Chuck Rubin, Chairman and Chief Executive Officer. "As we turn to the fourth quarter, we believe our holiday assortment is bigger and better than ever, and our teams are ready to serve customers, both in stores and online. We are pleased with the start to the quarter, although we recognize the heart of the season still lies ahead."  

=Michaels Stores (MIK) reported earnings on Thur 24 August 2017 (b/o)

Michaels Stores beats by $0.03, beats on revs; guides Q3 EPS in-line; raises FY18 guidance

• Reports Q2 (Jul) earnings of $0.19 per share, $0.03 better thanthe Capital IQ Consensus of $0.16; revenues rose 1.2% year/year to $1.07 bln vs the $1.06 bln Capital IQ Consensus. 
• Comparable store sales +0.6% vs. -0.5 to -1.5% guidance, or 0.8% on a constant currency basis, driven by an increase in customer transactions, which was partially offset by a decline in average ticket.
• As a percentage of net sales, gross profit increased 70 basis points to 37.5% compared to 36.8% in the second quarter of fiscal 2016. The increase, as a percentage of net sales, was due to higher merchandise margin and distribution-related costs. These benefits were partially offset by higher inventory shrinkage and a $1.4 million benefit associated with net non-recurring, inventory-related purchase accounting adjustments in the second quarter of fiscal 2016 related to the acquisition of Lamrite West.
• Co issues in-line guidance for Q3, sees EPS of $0.41-0.43 vs. $0.42 Capital IQ Consensus Estimate; comps +1.2-2.2%
• Co issues upside guidancefor FY18, sees EPS of $2.11-2.16 vs. $2.08 Capital IQ Consensus Estimate; raises sales to +2.8-3.8% from +2.2-3.7%; raises comps to +0.5-1.5% from +0.2-1.3%.
• "Our efforts to create a more experiential, omnichannel shopping experience, improve our value perception, and leverage our customer analytics are gaining traction earlier than we initially expected. As we begin the second half of the year, we believe these efforts will continue to deliver profitable growth and enable us to further expand our leadership in the arts and crafts channel."

=Michaels Stores (MIK) reported earnings on Tue 6 June 2017 (b/o)

Michaels Stores misses by $0.01, reports revs in-line; comps -1.2%; guides Q2 EPS below consensus; narrows full year guidance :

• Reports Q1 (Apr) earnings of $0.38 per share, $0.01 worse than the Capital IQ Consensus of $0.39; revenues were unchanged from the year-ago period at $1.16 bln.
  • Comparable store sales decreased 1.2% driven by a decrease in average ticket. 
• Co issues downside guidance for Q2, sees EPS of $0.15-0.17 vs. $0.19 Capital IQ Consensus Estimate. Sees comparable store sales down 0.5% to 1.5%, or be approximately flat to down 1.0% on a constant currency basis;
• Co narrows guidance for FY17, sees EPS of $2.03-2.15 vs. $2.12 Capital IQ Consensus Estimate. Sees total net sales growth of 2.2% to 3.7%, or 2.5% to 4.0% on a constant currency basis, including the impact of the 53rd week, which is planned to be approximately $80 million;
  • Comparable store sales to be down 0.2% to up 1.3%, or flat to up 1.5% on a constant currency basis;
• "Our operational expectations for the remainder of 2017 have not changed. We continue to believe that top-line trends will improve in the second half as we anniversary the 2016 coloring headwind, disruption created from store layout changes made in the third quarter last year, and the U.S. elections. However, the value of the Canadian dollar has weakened since we established our prior outlook, and we have adjusted our fiscal 2017 full year guidance to reflect our expectation this currency trend continues," 

=Michaels Stores (MIK) reported earnings on Tue 7 March 17 (b/o)

Michaels Stores beats by $0.01, reports revs in-line; guides Q1 EPS in-line; guides FY17 EPS above consensus:

• Reports Q4 (Jan) earnings of $0.96 per share, excluding non-recurring items, $0.01 better than the Capital IQ Consensus of $0.95; revenues rose 4.1% year/year to $1.75 bln vs the $1.76 bln Capital IQ Consensus.
  • Comparable store sales decreased 1.0% driven by a decrease in customer transactions, which was partially offset by an increase in average ticket.
  • As a percentage of net sales, gross profit was 40.3% compared to 40.9% in the fourth quarter of fiscal 2015. The decrease, as a percentage of net sales, was due to promotional investments; the acquisition of Lamrite West, which has a lower gross margin rate than the Michaels business; and $1.1 million of non-recurring, inventory-related purchase accounting adjustments.
• Co issues in-line guidance for Q1, sees EPS of $0.38-0.40 vs. $0.39 Capital IQ Consensus Estimate.
  • Comparable store sales growth expected to be flat to down 1%;
• Co issues upside guidance for FY17, sees EPS of $2.05-2.17 vs. $2.04 Capital IQ Consensus Estimate; sees FY17 revs up 2.5% to 4.0%, including the impact of the 53rd week, which is planned to be approximately $80 million; equates to roughly $5.33-5.41 bln vs. $5.44 bln Capital IQ Consensus Estimate.
  • Comparable store sales expected to be flat to up 1.5%.

=Michaels Stores (MIK) reported earnings Tue 6 Dec 2016 (b/o)

Michaels Stores misses by $0.03, misses on revs; guides Q4 EPS below consensus; Q3 comps -2% vs guidance of +0.5-1.5%; authorizes $300 mln stock repurchase program:

• Reports Q3 (Oct) earnings of $0.40 per share, excluding non-recurring items, $0.03 worse than the Capital IQ Consensus of $0.43; revenues rose 5.0% year/year to $1.23 bln vs the $1.26 bln Capital IQ Consensus. Comparable store sales decreased 2.0% (guidance +0.5-1.5%)driven by a decrease in customer transactions, which was partially offset by an increase in average ticket.
• Co issues downside guidance for Q4, sees EPS of $0.94-0.98, excluding non-recurring items, vs. $0.99 Capital IQ Consensus Estimate; Co sees Q4 comps flat to down 1.5%.
• Gross profit increased 0.2% to $466.6 million, from $465.6 million in the third quarter of fiscal 2015.
• As a percentage of net sales, gross profit was 38.0% compared to 39.8% in the third quarter of fiscal 2015.
• In December 2016, the Board of Directors authorized the Company to purchase, from time to time, as market conditions warrant, $300 million of the Company's common stock, which is in addition to its prior repurchase authorization. 

Michaels Stores (MIK) reported earnings Tue 7 June 2016 (b/o)

** charts before earnings **

 

** charts after earnings **

 

** 6 weeks later  **

Michaels Stores beats by $0.01, reports revs in-line with comps below guidance; guides Q2 EPS below consensus; guides FY17 EPS in-line, reaffirms FY17 rev, comp guidance; CFO Sonsteby becomes Vice Chairman, searching for new CFO :

• Reports Q1 (Apr) earnings of $0.36 per share, $0.01 better than the Capital IQ Consensus of $0.35; revenues rose 7.5% year/year to $1.16 bln vs the $1.17 bln Capital IQ Consensus.
  • Comps +0.9% vs. +1.9-2.4% guidance.
• Co issues downside guidance for Q2, sees EPS of $0.16-0.18 vs. $0.21 Capital IQ Consensus; comps +0.4-1.4%.
• Co issues guidance for FY17, raises EPS to $1.89-1.97 from $1.88-1.96 vs. $1.95 Capital IQ Consensus Estimate; reaffirms FY17 revs +8-9% to ~$5.31-5.35 bln vs. $5.34 bln Capital IQ Consensus; reaffirms comps +2.2-2.7%. 

Michaels Stores (MIK) reported earnings Thur 17 March 2016 (b/o)

** charts after earnings **

 Michaels Stores beats by $0.03, beats on revs; guides Q1 EPS below consensus; guides FY17 EPS in-line; announces $200 mln buyback :

• Reports Q4 (Jan) earnings of $0.87 per share, $0.03 better than the Capital IQ Consensus of $0.84; revenues rose 4.6% year/year to $1.68 bln vs the $1.65 bln Capital IQ Consensus.
  • Comparable store sales increased 3.1%, or 4.7% on a constant currency basis.
  • As a percent of sales, gross profit decreased 30 basis points to 40.9% compared to 41.2% in the fourth quarter of fiscal 2014. The decline was driven by clearance activity as part of ongoing department resets; the negative impact of foreign exchange rates; a shift in sales mix; and investments to improve the in-store environment. The decrease was partially offset by improved sourcing and pricing efficiencies. 
• Co issues downside guidance for Q1, sees EPS of $0.34-0.36 vs. $0.38 Capital IQ Consensus; comps +1.9-2.4%.
• Co issues in-line guidance for FY17, sees EPS of $1.88-1.96 vs. $1.92 Capital IQ Consensus; total sales including Lamrite West +8-9%; comps +2.2-2.7%. 
• The Company expects that the integration of Lamrite West will create near-term pressure on operating margin in fiscal 2016, reflecting the timing of profit recognition of the product Michaels procures through Lamrite West; the incorporation of the wholesale business, which has a lower gross margin rate than the Michaels business; and additional investments needed to integrate and enhance combined capabilities.
• Board of Directors has authorized the Company to purchase, from time to time, as market conditions warrant, $200 million of the Company's common stock.

Michaels Stores (MIK) reported earnings Thur 3 Dec 2015 (b/o)

** charts before earnings **

 ** charts after earnings **

Michaels Stores beats by $0.01, reports revs in-line; guides Q4 EPS :

• Reports Q3 (Oct) earnings of $0.37 per share, $0.01 better than the Capital IQ Consensus of $0.36; revenues rose 3.4% year/year to $1.17 bln vs the $1.17 bln Capital IQ Consensus. Comparable store sales increased by 1.5% or 3.1% on a constant currency basis.
• Co issues in-line guidance for Q4, sees EPS of $0.82-0.85 vs. $0.85 Capital IQ Consensus Estimate. Sees fourth quarter comparable store sales growth of 0.5% to 1.5% or 1.9% to 2.9% on a constant currency basis, operating income of $308 to $319 million.

MIK — NR

 Not ready for several more months