1-800-FLOWERS.COM, Inc. and Subsidiaries
Note 1314– Commitments and Contingencies
Litigation
ThereBed Bath & Beyond:
On April 1, 2020, the Seller commenced an action against the Company in the Court of Chancery for the State of Delaware, which is captioned Bed Bath & Beyond Inc. v. 1-800-Flowers.com, et ano., C.A. (the “Complaint”), alleging a breach of the Equity Purchase Agreement (the “Purchase Agreement”), dated February 14, 2020, between Seller, PersonalizationMall, the Company and the Purchaser, pursuant to which the Seller agreed to sell to Purchaser, and the Purchaser agreed to purchase from Seller, all of the issued and outstanding membership interests of PersonalizationMall. The action was initiated after the Company requested a reasonable delay in the closing under the Purchase Agreement due to the unprecedented circumstances created by COVID-19. The Complaint requested an order of specific performance to consummate the transaction under the Purchase Agreement plus attorney’s fees and costs in connection with the action. The Company filed its answer to the Complaint on April 17, 2020 and an order governing expedited proceedings was approved on April 9, 2020 that set a trial date for late September 2020. On July 21, 2020, the Company and Seller entered into a settlement agreement, pursuant to which the Company agreed to move forward with its purchase of PersonalizationMall for $245.0 million, subject to certain working capital and other adjustments. The transaction closed on August 3, 2020. In connection with the settlement agreement, the parties executed a Stipulation and Proposed Order of Dismissal, resulting in the voluntary dismissal with prejudice of the litigation relating to the transaction.
In addition, there are various claims, lawsuits, and pending actions against the Company and its subsidiaries incident to the operations of its businesses. It is the opinion of management, after consultation with counsel, that the ultimatefinal resolution of such claims, lawsuits and pending actions will not have a material adverse effect on the Company's consolidated financial position, results of operations or liquidityliquidity.
Note 15– Subsequent Event
Acquisition of Vital Choice
On October 27, 2021, the Company completed its acquisition of Vital Choice Seafood LLC, a provider of wild-caught seafood and sustainably farmed shellfish, pastured proteins, organic foods, and marine-sourced nutritional supplements. The Company utilized its existing credit facility to fund the $20.0 million purchase (subject to certain working capital and other adjustments), which included tradenames, customer lists, websites and operations. Vital Choice revenues were approximately $27.8 million during its most recent year ended December 31, 2020.
1516
ITEM 2.2. MANAGEMENT’S’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
Forward Looking Statements
This “Management’s“Management’s Discussion and Analysis of Financial Condition and Results of Operations” (MD&A)Operations” ("MD&A") is intended to provide an understanding of our financial condition, change in financial condition, cash flow, liquidity and results of operations. The following MD&A discussion should be read in conjunction with the consolidated financial statements and notes to those statements that appear elsewhere in this Form 10-Q and in the Company’s Company’s Annual Report on Form 10-K.10-K, for the year ended June 27, 2021. The following discussion contains forward-looking statements that reflect the Company’sCompany’s plans, estimates and beliefs. The Company’sCompany’s actual results could differ materially from those discussed or referred to in the forward-looking statements. Factors that could cause or contribute to any differences include, but are not limited to, those discussed under the caption “Forward-Looking“Forward-Looking Information and Factors That May Affect Future Results” andResults,” under Part I, Item 1A, of the Company’s Company’s Annual Report on Form 10-K, for the year ended June 27, 2021under the heading “Risk Factors.“Risk Factors” and Part II-Other Information, Item 1A in this Form 10-Q.
Business Overview
1-800-FLOWERS.COM, Inc. and its subsidiariessubsidiaries (collectively, the “Company”) is a leading provider of gifts for all celebratory occasions. Fordesigned to help customers express, connect and celebrate. The Company’s business platform features our all-star family of brands, including: 1-800-Flowers.com®, 1-800-Baskets.com®, Cheryl’s Cookies®, Harry & David®, PersonalizationMall.com®, Shari’s Berries®, FruitBouquets.com®, Moose Munch®, The Popcorn Factory®, Wolferman’s Bakery®, Stock Yards® and Simply Chocolate®. Through the past 40 years, 1-800-Flowers.com® has been helping deliver smilesCelebrations Passport® loyalty program, which provides members with free standard shipping and no service charge across our portfolio of brands, 1-800-FLOWERS.COM, Inc. strives to customersdeepen relationships with a 100% Smile Guarantee® backing every gift. In addition to the 1-800-Flowers.com brand, which offers fresh flowers, plants, fruitcustomers. The Company also operates BloomNet®, an international floral and gift baskets, as well as balloons, plush and keepsake gifts, the Company’s BloomNet® international floral wireindustry service (www.mybloomnet.net) and Napco brands provideprovider offering a broad rangebroad-range of quality products and value-added services designed to help professional floristsmembers grow their businesses profitably. The 1-800-FLOWERS.COM, Inc. familyprofitably; Napco℠, a resource for floral gifts and seasonal décor; and DesignPac Gifts, LLC, a manufacturer of brands also offers everyday gifting and entertaining products such as premium, gift-quality fruits and other gourmet items from Harry & David® (1-877-322-1200 or www.harryanddavid.com), popcorn and specialty treats from The Popcorn Factory® (1-800-541-2676 or www.thepopcornfactory.com); cookies and baked gifts from Cheryl’s® (1-800-443-8124 or www.cheryls.com); gift baskets and towers from 1-800-Baskets.com® (www.1800baskets.com) and DesignPac; premium English muffins and other breakfast treats from Wolferman’s (1-800-999-1910 or www.wolfermans.com); artisanal and specialty chocolates from Simply ChocolateSM (www.simplychocolate.com), carved fresh fruit arrangements from FruitBouquets.com (www.fruitbouquets.com); top quality steaks and chops from Stock Yards® (www.stockyards.com), and personalized gifts from Personalization Universe�� (www.personalizationuniverse.com).towers.
Service offerings such as Celebrations Passport®, Celebrations Rewards®For additional information, see Item 7 of Part II, “Management’s Discussion and Celebrations Reminders® are designed to deepen relationships with customers across all brands. 1-800-FLOWERS.COM, Inc. was named to the Stores® 2017 Hot 100 Retailers List by the National Retail FederationAnalysis of Financial Condition and received the Gold award in the “Best Artificial Intelligence” category at the Data & Marketing Association’s 2017 International ECHO AwardsResults of Operations — Overview” of our Annual Report on Form 10-K for the Company’s groundbreaking implementation of an artificial intelligence-powered online gift concierge, GWYN.year ended June 27, 2021.
Shares in 1-800-FLOWERS.COM, Inc. are traded on the NASDAQ Global Select Market, ticker symbol: FLWS. Acquisition of PersonalizationMall
On May 30, 2017,August 3, 2020, the Company completed the saleits acquisition of the outstanding equity of Fannie May Confections Brands, Inc., including its subsidiaries, Fannie May Confections, Inc. and Harry London Candies, Inc. (“Fannie May”PersonalizationMall.com LLC ("PersonalizationMall") to Ferrero International S.A., a Luxembourg corporation (“Ferrero”), forleading ecommerce provider of personalized products. The extensive offerings of PersonalizationMall include a total considerationwide variety of $115.0 million in cash, subject to adjustment for seasonal working capital. The working capital adjustment was finalized in August 2017, resulting inpersonalization processes such as sublimation, embroidery, digital printing, engraving and sandblasting, while providing an $11.4 million reduction to the purchase price. The resulting gainindustry-leading customer experience based on sale of $14.6 million, is included within “Other (income) expense, net” in the Company’s consolidated statements of income in the fourth quarter of fiscal year 2017.a fully integrated business platform that includes a highly automated personalization process and rapid order fulfillment.
The Company used a combination of cash on its balance sheet and Ferrero alsoits existing credit facility to fund the $245.0 million purchase (subject to certain working capital and other adjustments), which included its newly renovated, leased 360,000 square foot state-of-the-art production and distribution facility, as well as customer database, tradenames and website. PersonalizationMall’s revenues were approximately $171.2 million during its fiscal year ended February 29, 2020.
Amended Credit Agreement
Subsequent to, but in contemplation of the acquisition, on August 20, 2020, the Company entered into a transition services agreement wherebyFirst Amendment to its 2019 Credit Agreement to: (i) increase the Company will provide certain post-closing servicesaggregate principal amount of the existing Revolver commitments from $200.0 million to Ferrero and Fannie May for$250.0 million, (ii) establish a periodnew tranche of approximately 18 months, related toterm A-1 loans in an aggregate principal amount of $100.0 million (the “New Term Loan”), (iii) increase the business of Fannie May, and a commercial agreementworking capital sublimit with respect to the distributionRevolver from $175.0 million to $200.0 million, and (iv) increase the seasonally-reduced Revolver commitments from $100.0 million to $125.0 million for the period from January 1 through August 1 for each fiscal year of certain Ferrero and Fannie May products.the Company. The $100.0 million proceeds of the New Term Loan were used to repay the $95.0 million borrowing that had been drawn on its existing Revolver to finance the acquisition, as well as financing fees of approximately $2.0 million (See Note 8 - Debt, in Item 1. for details).
Operating results of Fannie May are reflected in the Company’s consolidated financial statements through May 30, 2017, the date of its disposition, within its Gourmet Food & Gift Baskets segment. See Segment Information and Results of Operations below for a comparison of fiscal 2018 results to fiscal 2017, adjusted to exclude the operations of Fannie May.COVID-19 Impact
In response to the global pandemic, the Company has taken actions to promote employee safety and business continuity, informed by the guidelines set forth by local, state and federal government and health officials. These initiatives include developing a “Pandemic Preparedness and Response Plan,” establishing an internal “nerve center” to allow for communication and coordination throughout the business, designing workstream teams to promote workforce protection and supply chain management, and dedicating resources to support customers, vendors, franchisees, and our BloomNet member florists.
The COVID-19 pandemic has affected, and will continue to affect, our operations and financial results for the foreseeable future. While there is significant uncertainty in the overall consumer environment due to the COVID-19 crisis, we continue to see strong e-commerce demand for gourmet foods and gift baskets and our floral and personalized products. With that said, there are headwinds (and resulting increased costs) that have been, and will continue to impact our operations during the foreseeable future, including:
| ● | Increased operating costs - we are seeing increased costs associated with the changes we have made, and continue to make, to our manufacturing, warehouse and distribution facilities to provide for the safety and wellbeing of our associates, including: required social distancing, enhanced facility cleaning and sanitizing schedules, and staggered production shifts, as well as overall wage rate increases and labor supply shortages. |
| | |
| ● | Supply chain constraints – the nationwide increase in e-commerce volume has also resulted in third-party carrier capacity constraints, and higher delivery costs, while ocean transport capacity shortages, caused by the ongoing global recovery from the pandemic, have contributed to supply chain shortages and increased costs. |
The scale and overall economic impact of the COVID-19 crisis is still very difficult to assess as the Company began to annualize the impact that COVID-19 has had on consumer behavior in its fiscal fourth quarter of 2021. However, the Company believes that the operating platform it has built over the years, combined with its diversified product line, and ability to engage with its customers will allow it to successfully navigate this challenging environment and continue to grow revenues at a double-digit pace through fiscal 2022. The Company’s 9.0 percent revenue growth for the quarter, followed 51.5 percent growth achieved in last year’s first quarter, when ecommerce demand spiked during the early stages of the pandemic. As we had anticipated, the first quarter of fiscal 2022 started out somewhat slowly, with demand gradually ramping up, before reaching double-digit growth in the month of September. Continuing recognition and relevance of the Company’s products for everyday gifting and connective occasions, as well as an expanded product offering, including PersonalizationMall, were the primary drivers of growth.
In order to mitigate the impact of the aforementioned headwinds, the Company has implemented a number of initiatives designed to take advantage of the strong ecommerce demand we anticipate during the key holiday season. These initiatives include strategic pricing programs across our brands, as wells as the significant investments we have made in our operating platform, including pre-building inventory, which leverages our expanded cold-storage facilities, and deploying automation in our warehouse and distribution facilities to increase throughput and reduces reliance on seasonal labor. As a result, we are well positioned to help our customers connect and express themselves with the important people in their lives for both everyday occasions and the key holiday season.
Company Guidance
The Company is reaffirming its guidance for its fiscal 2022 year, which includes:
| • | Total revenue growth of 10.0 percent-to-12.0 percent compared with the prior year; |
| • | Adjusted EBITDA growth of 5.0 percent-to-8.0 percent compared with the prior year; |
| • | EPS in line with fiscal 2021 as improved EBITDA is offset by higher depreciation and a higher effective tax rate; and |
| • | Free Cash Flow to exceed $100 million. |
The Company’s guidance for the year is based on several factors, including:
| • | The significant increase in consumers shopping online where the Company’s broad product offering and brand portfolio makes it a leading destination for customers looking for solutions to help them connect, express themselves and celebrate - sentiments that have become more important than ever; |
| • | Significant expansion of the Company’s product offering, both organically and through strategic acquisitions like Shari’s Berries and PersonalizationMall; |
| • | The expanded size of the Company’s customer file along with continued positive customer behavior trends; and |
| • | Continued strong growth in the Company’s Celebrations Passport® loyalty program, which is helping drive increased frequency, retention, and cross-category/cross-brand purchases. |
Definitions of non-GAAP Financial Measures:
We sometimes use financial measures derived from consolidated financial information, but not presented in our financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Certain of these are considered "non-GAAP financial measures" under the U.S. Securities and Exchange Commission rules. See below for definitions and the reasons why we use these non-GAAP financial measures. Where applicable, see the Segment Information and Results of Operationssections below for reconciliations of these non-GAAP measures to their most directly comparable GAAP financial measures. We do not provide a reconciliation of adjusted EBITDA guidance to net income guidance or a reconciliation of free cash flow guidance to net cash provided by operating activities because doing so would require unreasonable efforts at this time, because of the uncertainty and variability of the nature and amount of certain components of various necessary GAAP components, including for example those related to compensation, tax items, amortization or others that may arise during the year, and the Company's management believes such reconciliations would imply a degree of precision that would be confusing or misleading to investors. These non-GAAP financial measures are referred to as “adjusted" or “on a comparable basis” below, as these terms are used interchangeably.below.
Adjusted revenues
Adjusted revenues measure GAAP revenues adjusted for the effects
We believe that this measure provides management and investors with a more complete understanding of underlying revenue trends of established, ongoing operations by excluding the effect of activities which are subject to volatility and can obscure underlying trends.
Management recognizes that the term "adjusted revenues" may be interpreted differently by other companies and under different circumstances. Although this may influence comparability of absolute percentage growth from company to company, we believe that these measures are useful in assessing trends of the Company and its segments, and may therefore be a useful tool in assessing period-to-period performance trends.
Adjusted gross profit and adjusted gross profit percentage
Adjusted gross profit measures GAAP revenues less cost of revenues, adjusted for the effects of acquisitions, dispositions, and other items affecting period to period comparability. Adjusted gross profit percentage measures adjusted gross profit divided by adjusted revenues. See Segment Information for details on how adjusted gross profit and adjusted gross profit percentage were calculated for each period presented.
We believe that this measure provides management and investors with a more complete understanding of underlying gross profit trends of established, ongoing operations by excluding the effect of activities which are subject to volatility and can obscure underlying trends.
Management recognizes that the term "adjusted gross profit" or “adjusted gross profit percentage” may be interpreted differently by other companies and under different circumstances. Although this interpretation may vary from company to company, we believe that these consistently applied measures are useful in assessing trends of the Company and its segments, and may therefore be a useful tool in assessing period-to-period performance trends.
EBITDA and adjusted EBITDA
We define EBITDA as net income (loss) before interest, taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA adjusted for the impact of stock basedstock-based compensation, Non-QualifiedNQDC Plan Investment appreciation/investment appreciation/depreciation, and for certain items affecting period to periodperiod-to-period comparability. See Segment Information orfor details on how EBITDA and adjusted EBITDA were calculated for each period presented.
The Company presents EBITDA and adjusted EBITDA because it considers such information meaningful supplemental measures of its performance and believes such information is frequently used by the investment community in the evaluation of similarly situated companies. The Company uses EBITDA and adjusted EBITDA as factors used to determine the total amount of incentive compensation available to be awarded to executive officers and other employees. The Company's credit agreement uses EBITDA and adjusted EBITDA to measure compliance with covenants such as interest coverage and debt incurrence. EBITDA and adjusted EBITDA are also used by the Company to evaluate and price potential acquisition candidates.
EBITDA and adjusted EBITDA have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of the Company's results as reported under GAAP. Some of the limitations are: (a) EBITDA and adjusted EBITDA do not reflect changes in, or cash requirements for, the Company's working capital needs; (b) EBITDA and adjusted EBITDA do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on the Company's debts; and (c) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future and EBITDA does not reflect any cash requirements for such capital expenditures. EBITDA should only be used on a supplemental basis combined with GAAP results when evaluating the Company's performance.
Segment contribution margincontribution margin and adjusted segment contribution margin
We define segment contribution margin as earnings before interest, taxes, depreciation and amortization, before the allocation of corporate overhead expenses. Adjusted segment contribution margin is defined as segment contribution margin adjusted for certain items affecting period to periodperiod-to-period comparability. See Segment Information for details on how segment contribution margin and comparable segment contribution margin werewas calculated for each period presented.
When viewed together with our GAAPGAAP results, we believe segment contribution margin and comparableadjusted segment contribution margin provide management and users of the financial statements meaningful information about the performance of our business segments.
Segment contribution margin and comparableadjusted segment contribution margin are used in addition to and in conjunction with results presented in accordance with GAAP and should not be relied upon to the exclusion of GAAP financial measures. The material limitation associated with the use of the segment contribution margin and adjusted segment contribution margin is that it isthey are an incomplete measure of profitability as it doesthey do not include all operating expenses or non-operating income and expenses. Management compensates for these limitations when using this measure by looking at other GAAP measures, such as operating income and net income.
Adjusted net income (loss) and adjusted or comparable net income (loss) per common share
We define adjusted net income (loss) and adjusted or comparable net income (loss) per common share as net income (loss) and net income (loss) per common share adjusted for certain items affecting period to periodperiod-to-period comparability. See Segment Information below below for details on how adjusted net income (loss) and adjusted or comparable net income (loss) per common share were calculated for each period presented.
We believe that adjusted net income (loss) and adjusted or comparable net income (loss) per common share are meaningful measures because they increase the comparability of period to periodperiod-to-period results.
Since these are not measures of performance calculated in accordance with GAAP, they should not be considered in isolation of, or as a substitute for, GAAP net income (loss) and net income (loss) per common share, as indicators of operating performance and they may not be comparable to similarly titled measures employed by other companies.
Free Cash Flow
We define free cash flow as net cash provided by operating activities less capital expenditures. The Company considers free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business after the purchases of fixed assets, which can then be used to, among other things, invest in the Company’s business, make strategic acquisitions, strengthen the balance sheet, and repurchase stock or retire debt. Free cash flow is a liquidity measure that is frequently used by the investment community in the evaluation of similarly situated companies.
Since free cash flow is not a measure of performance calculated in accordance with GAAP, it should not be considered in isolation or as a substitute for analysis of the Company's results as reported under GAAP. A limitation of the utility of free cash flow as a measure of financial performance is that it does not represent the total increase or decrease in the company's cash balance for the period.
SegmentInformation
The following table presents the net revenues,revenues, gross profit and segment contribution margin from each of the Company’s business segments, as well as consolidated EBITDA, Adjusted EBITDA and adjusted net income.EBITDA.
| | | Three Months Ended |
| | | December 31, 2017 | | | January 1, 2017 | | | Exclude Operating Results of Fannie May | | | Severance Costs | | | Adjusted (non-GAAP) December 31, 2017 | | | Adjusted (non-GAAP) % Change | | |
| | | (dollars in thousands) | |
Net revenues: | | | | | | | | | | | | | | | | | | | | | | | | | |
1-800-Flowers.com Consumer Floral | | $ | 100,064 | | | $ | 97,808 | | | $ | - | | | $ | - | | | $ | 97,808 | | | | 2.3 | % | |
BloomNet Wire Service | | | 20,375 | | | | 20,502 | | | | | | | | | | | | 20,502 | | | | -0.6 | % | |
Gourmet Food & Gift Baskets | | | 405,964 | | | | 436,870 | | | | (41,199 | ) | | | - | | | | 395,671 | | | | 2.6 | % | |
Corporate | | | 317 | | | | 316 | | | | | | | | | | | | 316 | | | | 0.3 | % | |
Intercompany eliminations | | | (627 | ) | | | (943 | ) | | | 344 | | | | - | | | | (599 | ) | | | -4.7 | % | |
Total net revenues | | $ | 526,093 | | | $ | 554,553 | | | $ | (40,855 | ) | | $ | - | | | $ | 513,698 | | | | 2.4 | % | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Gross profit: | | | | | | | | | | | | | | | | | | | | | | | | | |
1-800-Flowers.com Consumer Floral | | $ | 38,844 | | | $ | 40,300 | | | | - | | | | - | | | $ | 40,300 | | | | -3.6 | % | |
| | | | 38.8 | % | | | 41.2 | % | | | | | | | | | | | 41.2 | % | | | | | |
| | | | | | | | | | | | - | | | | - | | | | | | | | | | |
BloomNet Wire Service | | | 11,693 | | | | 12,310 | | | | | | | | | | | | 12,310 | | | | -5.0 | % | |
| | | | 57.4 | % | | | 60.0 | % | | | - | | | | - | | | | 60.0 | % | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Gourmet Food & Gift Baskets | | | 184,468 | | | | 204,185 | | | | (15,939 | ) | | | - | | | | 188,246 | | | | -2.0 | % | |
| | | | 45.4 | % | | | 46.7 | % | | | | | | | | | | | 47.6 | % | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Corporate (a) | | | 254 | | | | 199 | | | | - | | | | - | | | | 199 | | | | 27.6 | % | |
| | | | 80.1 | % | | | 63.0 | % | | | | | | | | | | | 63.0 | % | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Total gross profit | | $ | 235,259 | | | $ | 256,994 | | | $ | (15,939 | ) | | $ | - | | | $ | 241,055 | | | | -2.4 | % | |
| | | | 44.7 | % | | | 46.3 | % | | | | | | | | | | | 46.9 | % | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
EBITDA (non-GAAP): | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Segment Contribution Margin (non-GAAP): | | | | | | | | | | | | | | | | | | | | | | | | | |
1-800-Flowers.com Consumer Floral | | $ | 10,791 | | | $ | 13,128 | | | $ | - | | | $ | - | | | $ | 13,128 | | | | -17.8 | % | |
BloomNet Wire Service | | | 7,692 | | | | 8,189 | | | | - | | | | - | | | | 8,189 | | | | -6.1 | % | |
Gourmet Food & Gift Baskets | | | 93,496 | | | | 104,624 | | | | (6,219 | ) | | | 79 | | | | 98,484 | | | | -5.1 | % | |
Segment Contribution Margin Subtotal | | | 111,979 | | | | 125,941 | | | | (6,219 | ) | | | 79 | | | | 119,801 | | | | -6.5 | % | |
Corporate (a) | | | (18,836 | ) | | | (20,223 | ) | | | 356 | | | | - | | | | (19,867 | ) | | | 5.2 | % | |
EBITDA (non-GAAP) | | | 93,143 | | | | 105,718 | | | | (5,863 | ) | | | 79 | | | | 99,934 | | | | -6.8 | % | |
Add: Stock-based compensation | | | 968 | | | | 1,724 | | | | - | | | | - | | | | 1,724 | | | | -43.9 | % | |
Add: Comp charge related to NQ Plan Investment Appreciation | | | 364 | | | | 20 | | | | - | | | | - | | | | 20 | | | | 1720.0 | % | |
Adjusted EBITDA (non-GAAP) | | $ | 94,475 | | | $ | 107,462 | | | $ | (5,863 | ) | | $ | 79 | | | $ | 101,678 | | | | -7.1 | % | |
| | | Three Months Ended | |
| | | September 26, 2021 | | | Transaction Costs | | | As Adjusted (non-GAAP) September 26, 2021 | | | September 27, 2020 | | | PersonalizationMall Litigation & Transaction Costs | | | Harry & David Store Closure Costs | | | As Adjusted (non-GAAP) September 27, 2020 | | | % Change | |
Net revenues: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer Floral & Gifts | | $ | 181,229 | | | $ | - | | | $ | 181,229 | | | $ | 161,546 | | | $ | - | | | $ | - | | | $ | 161,546 | | | | 12.2 | % |
BloomNet | | | 30,834 | | | | | | | | 30,834 | | | | 32,738 | | | | | | | | | | | | 32,738 | | | | -5.8 | % |
Gourmet Foods & Gift Baskets | | | 97,482 | | | | | | | | 97,482 | | | | 89,929 | | | | | | | | | | | | 89,929 | | | | 8.4 | % |
Corporate | | | 45 | | | | | | | | 45 | | | | 106 | | | | | | | | | | | | 106 | | | | -57.5 | % |
Intercompany eliminations | | | (217 | ) | | | | | | | (217 | ) | | | (547 | ) | | | | | | | | | | | (547 | ) | | | 60.3 | % |
Total net revenues | | $ | 309,373 | | | $ | - | | | $ | 309,373 | | | $ | 283,772 | | | $ | - | | | $ | - | | | $ | 283,772 | | | | 9.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Gross profit: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer Floral & Gifts | | $ | 76,003 | | | | | | | $ | 76,003 | | | $ | 65,586 | | | | | | | | | | | $ | 65,586 | | | | 15.9 | % |
| | | | 41.9 | % | | | | | | | 41.9 | % | | | 40.6 | % | | | | | | | | | | | 40.6 | % | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
BloomNet | | | 15,409 | | | | | | | | 15,409 | | | | 14,838 | | | | | | | | | | | | 14,838 | | | | 3.8 | % |
| | | | 50.0 | % | | | | | | | 50.0 | % | | | 45.3 | % | | | | | | | | | | | 45.3 | % | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Gourmet Foods & Gift Baskets | | | 34,163 | | | | | | | | 34,163 | | | | 35,007 | | | | | | | | | | | | 35,007 | | | | -2.4 | % |
| | | | 35.0 | % | | | | | | | 35.0 | % | | | 38.9 | % | | | | | | | | | | | 38.9 | % | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Corporate | | | (61 | ) | | | | | | | (61 | ) | | | 49 | | | | | | | | | | | | 49 | | | | -224.5 | % |
| | | | -135.6 | % | | | | | | | -135.6 | % | | | 46.2 | % | | | | | | | | | | | 46.2 | % | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total gross profit | | $ | 125,514 | | | $ | - | | | $ | 125,514 | | | $ | 115,480 | | | $ | - | | | $ | - | | | $ | 115,480 | | | | 8.7 | % |
| | | | 40.6 | % | | | - | | | | 40.6 | % | | | 40.7 | % | | | - | | | | - | | | | 40.7 | % | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
EBITDA (non-GAAP): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Segment Contribution Margin (non-GAAP) (a): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer Floral & Gifts | | $ | 19,190 | | | $ | - | | | $ | 19,190 | | | $ | 19,236 | | | $ | - | | | $ | - | | | $ | 19,236 | | | | -0.2 | % |
BloomNet | | | 10,860 | | | | | | | | 10,860 | | | | 10,421 | | | | | | | | | | | | 10,421 | | | | 4.2 | % |
Gourmet Foods & Gift Baskets | | | (7,673 | ) | | | | | | | (7,673 | ) | | | (2,581 | ) | | | | | | | (405 | ) | | | (2,986 | ) | | | -157.0 | % |
Segment Contribution Margin Subtotal | | | 22,377 | | | | - | | | | 22,377 | | | | 27,076 | | | | - | | | | (405 | ) | | | 26,671 | | | | -16.1 | % |
Corporate (b) | | | (31,731 | ) | | | 456 | | | | (31,275 | ) | | | (31,697 | ) | | | 4,890 | | | | | | | | (26,807 | ) | | | -16.7 | % |
EBITDA (non-GAAP) | | | (9,354 | ) | | | 456 | | | | (8,898 | ) | | | (4,621 | ) | | | 4,890 | | | | (405 | ) | | | (136 | ) | | | -6442.6 | % |
Add: Stock-based compensation | | | 3,005 | | | | | | | | 3,005 | | | | 2,393 | | | | | | | | | | | | 2,393 | | | | 25.6 | % |
Add: Compensation charge related to NQ Plan Investment Appreciation | | | 567 | | | | | | | | 567 | | | | 980 | | | | | | | | | | | | 980 | | | | -42.1 | % |
Adjusted EBITDA (non-GAAP) | | $ | (5,782 | ) | | $ | 456 | | | $ | (5,326 | ) | | $ | (1,248 | ) | | $ | 4,890 | | | $ | (405 | ) | | $ | 3,237 | | | | -264.5 | % |
| | | Six Months Ended | |
| | | December 31, 2017 | | | January 1, 2017 | | | Exclude Operating Results of Fannie May | | | Severance Costs | | | Adjusted (non-GAAP) December 31, 2017 | | | Adjusted (non-GAAP) % Change | |
| | | (dollars in thousands) |
Net revenues: | | | | | | | | | | | | | | | | | | | | | | | | |
1-800-Flowers.com Consumer Floral | | $ | 176,674 | | | $ | 173,023 | | | $ | - | | | $ | - | | | $ | 173,023 | | | | 2.1 | % |
BloomNet Wire Service | | | 40,139 | | | | 41,466 | | | | - | | | | - | | | | 41,466 | | | | -3.2 | % |
Gourmet Food & Gift Baskets | | | 466,950 | | | | 506,684 | | | | (52,573 | ) | | | - | | | | 454,111 | | | | 2.8 | % |
Corporate | | | 587 | | | | 579 | | | | - | | | | - | | | | 579 | | | | 1.4 | % |
Intercompany eliminations | | | (908 | ) | | | (1,370 | ) | | | 514 | | | | - | | | | (856 | ) | | | -6.0 | % |
Total net revenues | | $ | 683,442 | | | $ | 720,382 | | | $ | (52,059 | ) | | $ | - | | | $ | 668,323 | | | | 2.3 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Gross profit: | | | | | | | | | | | | | | | | | | | | | | | | |
1-800-Flowers.com Consumer Floral | | $ | 69,578 | | | $ | 70,799 | | | $ | - | | | $ | - | | | $ | 70,799 | | | | -1.7 | % |
| | | | 39.4 | % | | | 40.9 | % | | | | | | | | | | | 40.9 | % | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
BloomNet Wire Service | | | 22,751 | | | | 24,104 | | | | - | | | | - | | | | 24,104 | | | | -5.6 | % |
| | | | 56.7 | % | | | 58.1 | % | | | | | | | | | | | 58.1 | % | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Gourmet Food & Gift Baskets | | | 209,620 | | | | 232,936 | | | | (20,425 | ) | | | - | | | | 212,511 | | | | -1.4 | % |
| | | | 44.9 | % | | | 46.0 | % | | | | | | | | | | | 46.8 | % | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Corporate (a) | | | 588 | | | | 542 | | | | - | | | | - | | | | 542 | | | | 8.5 | % |
| | | | 100.2 | % | | | 93.6 | % | | | | | | | | | | | 93.6 | % | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Total gross profit | | $ | 302,537 | | | $ | 328,381 | | | $ | (20,425 | ) | | $ | - | | | $ | 307,956 | | | | -1.8 | % |
| | | | 44.3 | % | | | 45.6 | % | | | | | | | | | | | 46.1 | % | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
EBITDA (non-GAAP): | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Segment Contribution Margin (non-GAAP): | | | | | | | | | | | | | | | | | | | | | | | | |
1-800-Flowers.com Consumer Floral | | $ | 17,762 | | | $ | 21,309 | | | $ | - | | | $ | - | | | $ | 21,309 | | | | -16.6 | % |
BloomNet Wire Service | | | 14,393 | | | | 15,468 | | | | - | | | | - | | | | 15,468 | | | | -6.9 | % |
Gourmet Food & Gift Baskets | | | 88,509 | | | | 95,320 | | | | (3,018 | ) | | | 103 | | | | 92,405 | | | | -4.2 | % |
Segment Contribution Margin Subtotal | | | 120,664 | | | | 132,097 | | | | (3,018 | ) | | | 103 | | | | 129,182 | | | | -6.6 | % |
Corporate (a) | | | (39,040 | ) | | | (41,491 | ) | | | 763 | | | | - | | | | (40,728 | ) | | | 4.1 | % |
EBITDA (non-GAAP) | | | 81,624 | | | | 90,606 | | | | (2,255 | ) | | | 103 | | | | 88,454 | | | | -7.7 | % |
Add: Stock-based compensation | | | 2,069 | | | | 3,498 | | | | - | | | | - | | | | 3,498 | | | | -40.9 | % |
Add: Comp charge related to NQ Plan Investment Appreciation | | | 639 | | | | 282 | | | | - | | | | - | | | | 282 | | | | -126.6 | % |
Adjusted EBITDA (non-GAAP) | | $ | 84,332 | | | $ | 94,386 | | | $ | (2,255 | ) | | $ | 103 | | | $ | 92,234 | | | | -8.6 | % |
Reconciliation of net loss to adjusted net loss (non-GAAP): | | Three Months Ended | |
| | | September 26, 2021 | | | September 27, 2020 | |
| | | | | | | | | |
Net loss | | $ | (13,199 | ) | | $ | (9,762 | ) |
Adjustments to reconcile net loss to adjusted net loss (non-GAAP) | | | | | | | | |
Add: Transaction costs | | | 456 | | | | 4,890 | |
Deduct: Harry & David store closure cost adjustment | | | - | | | | (405 | ) |
Deduct: Income tax effect on adjustments | | | (173 | ) | | | (1,242 | ) |
Adjusted net loss (non-GAAP) | | $ | (12,916 | ) | | $ | (6,519 | ) |
| | | | | | | | | |
Basic and diluted net loss per common share | | $ | (0.20 | ) | | $ | (0.15 | ) |
| | | | | | | | | |
Basic and diluted adjusted net loss per common share (non-GAAP) | | $ | (0.20 | ) | | $ | (0.10 | ) |
| | | | | | | | | |
Weighted average shares used in the calculation of net loss and adjusted net loss per common share | | | 65,062 | | | | 64,320 | |
Reconciliation of net loss to adjusted EBITDA (non-GAAP): | | Three Months Ended | |
| | | September 26, 2021 | | | September 27, 2020 | |
| | | | | | | | | |
Net loss | | $ | (13,199 | ) | | $ | (9,762 | ) |
Add: Interest expense and other, net | | | 932 | | | | 41 | |
Add: Depreciation and amortization | | | 10,970 | | | | 8,840 | |
Deduct: Income tax benefit | | | 8,057 | | | | 3,740 | |
EBITDA | | | (9,354 | ) | | | (4,621 | ) |
Add: Stock-based compensation | | | 3,005 | | | | 2,393 | |
Add: Compensation charge related to NQ plan investment appreciation | | | 567 | | | | 980 | |
Add: Transaction costs | | | 456 | | | | 4,890 | |
Deduct: Harry & David store closure cost adjustment | | | - | | | | (405 | ) |
Adjusted EBITDA | | $ | (5,326 | ) | | $ | 3,237 | |
(a) Segment performance is measured based on segment contribution margin or segment Adjusted EBITDA, reflecting only the direct controllable revenue and operating expenses of the segments, both of which are non-GAAP measurements. As such, management’s measure of profitability for these segments does not include the effect of corporate overhead, described above, depreciation and amortization, other income (net), and other items that we do not consider indicative of our core operating performance.
(b) Corporate expenses consist of the Company’s enterprise shared service cost centers, and include, among other items, Information Technology, Human Resources, Accounting and Finance, Legal, Executive and Customer Service Center functions, as well as Stock-Based Compensation. In order to leverage the Company’s infrastructure, these functions are operated under a centralized management platform, providing support services throughout the organization. The costs of these functions, other than those of the Customer Service Center, which are allocated directly to the above categories based upon usage, are included within corporate expenses as they are not directly allocable to a specific segment.
Results of Operations
Reconciliation of net income to adjusted net income (non-GAAP):
| | | Three Months Ended | | | Years Ended | |
| | | December 31, 2017 | | | January 1, 2017 | | | December 31, 2017 | | | January 1, 2017 | |
| | | (in thousands, except per share data) |
| | | | | | | | | | | | | | | | | |
Net income | | $ | 70,699 | | | $ | 62,929 | | | $ | 57,477 | | | $ | 47,158 | |
Adjustments to reconcile net income to adjusted net income (non-GAAP) | | | | | | | | | | | | | | | | |
Deduct: Fannie May operating results | | | - | | | | 5,047 | | | | - | | | | 629 | |
Deduct: U.S. tax reform impact on deferred taxes (b) | | | 12,158 | | | | - | | | | 12,158 | | | | - | |
Add back: Severance costs | | | - | | | | 79 | | | | - | | | | 103 | |
Add back: Income tax expense impact on Fannie May operating results and severance adjustments | | | - | | | | 1,656 | | | | - | | | | 171 | |
Adjusted net income (non-GAAP) | | $ | 58,541 | | | $ | 59,617 | | | $ | 45,319 | | | $ | 46,803 | |
| | | | | | | | | | | | | | | | | |
Basic and diluted net income per common share | | | | | | | | | | | | | | | | |
Basic | | $ | 1.09 | | | $ | 0.97 | | | $ | 0.89 | | | $ | 0.72 | |
Diluted | | $ | 1.06 | | | $ | 0.93 | | | $ | 0.86 | | | $ | 0.70 | |
| | | | | | | | | | | | | | | | | |
Basic and diluted adjusted net income per common share (non-GAAP) | | | | | | | | | | | | | | | | |
Basic | | $ | 0.91 | | | $ | 0.91 | | | $ | 0.70 | | | $ | 0.72 | |
Diluted | | $ | 0.88 | | | $ | 0.88 | | | $ | 0.68 | | | $ | 0.69 | |
| | | | | | | | | | | | | | | | | |
Weighted average shares used in the calculation of net income and adjusted net income (non-GAAP) per common share | | | | | | | | | | | | | | | | |
Basic | | | 64,601 | | | | 65,172 | | | | 64,778 | | | | 65,112 | |
Diluted | | | 66,782 | | | | 67,754 | | | | 67,037 | | | | 67,778 | |
Reconciliation of net income to adjusted EBITDA (non-GAAP) (c):
| | | Three Months Ended | | | Years Ended | |
| | | December 31, 2017 | | | January 1, 2017 | | | December 31, 2017 | | | January 1, 2017 | |
| | | (in thousands) |
| | | | | | | | | | | | | | | | | |
Net income | | $ | 70,699 | | | $ | 62,929 | | | $ | 57,477 | | | $ | 47,158 | |
Add: | | | | | | | | | | | | | | | | |
Interest expense, net | | | 1,140 | | | | 2,155 | | | | 1,911 | | | | 3,456 | |
Depreciation and amortization | | | 8,677 | | | | 9,167 | | | | 16,761 | | | | 17,164 | |
Income tax expense | | | 12,627 | | | | 31,467 | | | | 5,475 | | | | 22,828 | |
EBITDA (non-GAAP) | | | 93,143 | | | | 105,718 | | | | 81,624 | | | | 90,606 | |
Add: | | | | | | | | | | | | | | | | |
Severance costs | | | - | | | | 79 | | | | - | | | | 103 | |
Compensation charge related to NQ plan investment appreciation | | | 364 | | | | 20 | | | | 639 | | | | 282 | |
Stock-based compensation | | | 968 | | | | 1,724 | | | | 2,069 | | | | 3,498 | |
Less: | | | | | | | | | | | | | | | | |
Fannie May EBITDA | | | - | | | | 5,863 | | | | - | | | | 2,255 | |
Adjusted EBITDA (non-GAAP) | | $ | 94,475 | | | $ | 101,678 | | | $ | 84,332 | | | $ | 92,234 | |
| a)
| Corporate expenses consist of the Company’s enterprise shared service cost centers, and include, among other items, Information Technology, Human Resources, Accounting and Finance, Legal, Executive and Customer Service Center functions, as well as Stock-Based Compensation. In order to leverage the Company’s infrastructure, these functions are operated under a centralized management platform, providing support services throughout the organization. The costs of these functions, other than those of the Customer Service Center, which are allocated directly to the above categories based upon usage, are included within corporate expenses as they are not directly allocable to a specific segment.
|
| b)
| The adjustment to deduct the impact of U.S. tax reform from Net Income includes the impact of the re-valuation of the Company’s deferred tax liability of $12.2 million, or $0.18 per diluted share, and does not include the ongoing impact of the lower federal corporate tax rate of $3.7 million, or $0.06 per diluted share.
|
| c)
| Segment performance is measured based on segment contribution margin or segment adjusted EBITDA, reflecting only the direct controllable revenue and operating expenses of the segments, both of which are non-GAAP measurements. As such, management’s measure of profitability for these segments does not include the effect of corporate overhead, described above, depreciation and amortization, other income (net), and other items that we do not consider indicative of our core operating performance.
|
Results of OperationsNet revenues
Net Revenues
| | | Three Months Ended | | | Six Months Ended | | | Three Months Ended | |
| | | December 31, 2017 | | | January 1, 2017 | | | % Change | | | December 31, 2017 | | | January 1, 2017 | | | % Change | | | September 26, 2021 | | | September 27, 2020 | | | % Change | |
| | | (dollars in thousands) | | | | | | | (dollars in thousands) | |
Net revenues: | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | |
E-Commerce | | $ | 424,132 | | | $ | 420,594 | | | | 0.8 | % | | $ | 532,903 | | | $ | 527,678 | | | | 1.0 | % | | $ | 263,371 | | | $ | 238,863 | | | 10.3 | % |
Other | | | 101,961 | | | | 133,959 | | | | -23.9 | % | | | 150,539 | | | | 192,704 | | | | -21.9 | % | | | 46,002 | | | | 44,909 | | | 2.4 | % |
Total net revenues | | $ | 526,093 | | | $ | 554,553 | | | | -5.1 | % | | $ | 683,442 | | | $ | 720,382 | | | | -5.1 | % | | $ | 309,373 | | | $ | 283,772 | | | 9.0 | % |
Net revenues consist primarily of the selling price of the merchandise, service or outbound shipping charges, less discounts, returns and credits.
Net revenues decreased 5.1%increased 9.0% duringboth the three and six months ended December 31, 2017,September 26, 2021, compared to the same periodsperiod of the prior year, due to the disposition of Fannie May on May 30, 2017. On a comparable basis, adjusting fiscal 2017 nethigher revenues to exclude the revenues of Fannie May, net revenues increased 2.4% and 2.3% during the three and six months ended December 31, 2017, respectively, compared to the same periods of the prior year. This increase was due to growth within the Consumer Floral & Gifts and Gourmet Foods & Gift Baskets segment, attributable to the Harry & David and 1-800-Baskets/DesignPac brands,segments, partially offset by slightly lower revenues ina decline within the Company’s BloomNet segment. ComparableAdjusted for the impact of the non-comparative period of PersonalizationMall, which was acquired on August 3, 2020, and is included in our Consumer Floral & Gifts segment, consolidated revenues grew 4.3% in comparison to the prior year. This revenue growth was negatively impactedduring one of our most challenging year-over-year comparisons, as it followed the 51.5% revenue growth we reported in the first quarter last year, which was accelerated by a temporary disruption in operations at our Cheryl’s brand, related to the recent implementationgrowth of a new production and warehouse management system, which, in turn, led to the brand’s decision to stop taking orders eight days prior to the Christmas holiday. As a result, the Company estimates that it had to forego approximately $4.0 million in holiday revenuese-commerce shopping during the threepandemic, and six months ended December 31, 2017. In addition, revenues duringas we faced significant headwinds affecting revenue growth, including increased digital marketing costs, and wide-spread delays in obtaining certain product components. This illustrates the six months ended December 31, 2017 were negatively impacted, by approximately $1.1 million, due to hurricanes Harvey and Irma.
E-commerce revenues (combined online and telephonic) increased by 0.8% and 1.0% duringstrong growth momentum that we have been building over the three and six months ended December 31, 2017, respectively, compared to the same periods of the prior year,past several years, as a result of increased recognition and relevance for our family of brands for everyday gifting and connective occasions, which was complemented by an expanded product assortment, including PersonalizationMall products. We also continued to see growth within the Consumer Floralin our Celebrations Passport loyalty program, which helps drive increased cross-brand purchasing, purchase frequency, retention, and Gourmet Foods & Gift Baskets segments. On a comparable basis, adjusting fiscal 2017 e-commerce revenues to exclude the revenues of Fannie May, e-commerce revenues increased 3.1% and 2.9%customer life-time value.
Disaggregated revenue by channel follows:
| | | Three Months Ended | | | Three Months Ended | |
| | | September 26, 2021 | | | September 27, 2020 | |
| | | Consumer Floral & Gifts | | | BloomNet | | | Gourmet Foods & Gift Baskets | | | Consolidated | | | Consumer Floral & Gifts | | | BloomNet | | | Gourmet Foods & Gift Baskets | | | Consolidated | |
Net revenues | | (in thousands) | |
E-commerce | | $ | 179,286 | | | $ | - | | | $ | 84,085 | | | $ | 263,371 | | | $ | 159,792 | | | $ | - | | | $ | 79,071 | | | $ | 238,863 | |
Retail | | | 1,110 | | | | - | | | | 1,837 | | | | 2,947 | | | | 946 | | | | - | | | | 1,573 | | | | 2,519 | |
Wholesale | | | - | | | | 9,984 | | | | 11,560 | | | | 21,544 | | | | - | | | | 11,292 | | | | 9,285 | | | | 20,577 | |
BloomNet services | | | - | | | | 20,850 | | | | - | | | | 20,850 | | | | - | | | | 21,446 | | | | - | | | | 21,446 | |
Other | | | 833 | | | | - | | | | - | | | | 833 | | | | 808 | | | | - | | | | - | | | | 808 | |
Corporate | | | - | | | | - | | | | - | | | | 45 | | | | - | | | | - | | | | - | | | | 106 | |
Eliminations | | | - | | | | - | | | | - | | | | (217 | ) | | | - | | | | - | | | | - | | | | (547 | ) |
Net revenues | | $ | 181,229 | | | $ | 30,834 | | | $ | 97,482 | | | $ | 309,373 | | | $ | 161,546 | | | $ | 32,738 | | | $ | 89,929 | | | $ | 283,772 | |
Revenue by sales channel:
● | E-commerce revenues (combined online and telephonic) increased by 10.3% during the three and six months ended December 31, 2017, respectively, compared to the same periods of the prior year. During the three months ended December 31, 2017, the three months ended September 26, 2021, comprised of 6.3% growth within the Gourmet Foods & Gift Baskets segment, and 12.2% within the Consumer Floral & Gifts segment, which includes the revenues of PersonalizationMall, since its date of acquisition on August 3, 2020. |
The Company fulfilled approximately 5.205,0003.7 million orders through its e-commerce sales channels (online and telephonic sales), during the three months ended September 26, 2021, an increase of 5.9% compared to approximately 5,263,000 (5,020,000 adjusted to exclude Fannie May orders in fiscal 2017) during the same period of the prior year, while average order value increased 4.1% to $81.44 during the three months ended December 31, 2017, from $79.92 ($81.92 adjusted to exclude Fannie May average order value in fiscal 2017)$70.95 during the same period of the prior year. During the six months ended December 31, 2017, the Company fulfilled approximately 6,725,000 orders through its e-commerce sales channels (online and telephonic sales), compared to approximately 6,780,000 (6,526,000 adjusted to exclude Fannie May orders in fiscal 2017) during the same period of the prior year, while average order value increased to $79.20 during the six months ended December 31, 2017, from $77.83 ($79.36 adjusted to exclude Fannie May average order value in fiscal 2017) during the same period of the prior year.
period.
Other revenues are comprised
● | Other revenues are comprised of the Company’s BloomNet segment, as well as the wholesale and retail channels of its Consumer Floral & Gifts and Gourmet Foods & Gift Baskets segments. Other revenues increased by 2.4% during the three months ended September 26, 2021, compared to the same period of the prior year, due to increased volume by Gourmet Food & Gift Basket wholesale customers as COVID-19 restrictions eased, partially offset by lower wholesale revenues within the BloomNet segment, primarily as a result of supply chain delays. |
Revenue by segment:
Consumer Floral and Gourmet Food and Gift Baskets segments. Other revenues decreased by 23.9% and 21.9% during the three and six months ended December 31, 2017, respectively, compared to the same periods& Gifts – this segment, which historically has consisted primarily of the prior year, primarily as a result of the Fannie May disposition during May 2017. On a comparable basis, adjusting fiscal 2017 other revenues to exclude the revenues of Fannie May, other revenues decreased 0.5% during the three months ended December 31, 2017, and increased 0.1% during the six months ended December 31, 2017, compared to the respective prior year periods.
The 1-800-Flowers.com Consumer Floral segment includes the operations of the 1-800-Flowers.com brand, whichbut now includes revenues attributable to PersonalizationMall subsequent to its August 3, 2020 acquisition date, derives revenue from the sale of consumer floral products and gifts through its e-commerce sales channels (telephonic and online sales), retail stores, and royalties from its franchise operations.
Net revenues within this segment increased 2.3%12.2% during the three months ended September 26, 2021, compared to the same period of the prior year, reflecting the contributions of PersonalizationMall and 2.1%the marketing and merchandising investments made in our flagship brand, which are continuing to drive growth and market share gains. This growth came during a period when consumers were distracted by summer activities that re-opened as COVID-19 restrictions were being lifted, validating the strength of the brand and its customer base. Pro-forma segment revenue growth was 3.9%, during the three and six months ended December 31, 2017, in comparison toSeptember 26, 2021, adjusting for the same periodsAugust 3, 2020 acquisition of the prior year, due to increased demand driven by merchandising and marketing efforts, as well as an increase in promotional activity in order to expand market share. Revenues during the six months ended December 31, 2017 were negatively impacted, by approximately $0.8 million, due to hurricanes Harvey and Irma.PersonalizationMall.
The BloomNet Wire Service- revenues in this segment includes revenuesare derived from membership fees, as well as other product and service offerings to florists. Net revenues decreased 0.6% and 3.2%5.8% during the three and six months ended December 31, 2017, respectively,September 26, 2021, compared to thethe same periodsperiod of the prior year, primarilyreflecting delays in wholesale hard-goods shipments due to lower membership, transaction feessupply chain constraints which have delayed receipt of product, and ancillary revenues resulting from a decline in network shop count,reduced florist-to-florist order volume, partially offset by higher wholesale product revenues. During the six months ended December 31, 2017, these decreases were exacerbated by the impact of hurricanes Harvey and Irma, as BloomNet provided financial aid to florists in the affected areas, and waived approximately $0.2 million offavorable membership fees.related services.
The Gourmet FoodFoods & Gift Baskets – this segment includes the operations of Harry & David, Wolferman’s, Stockyards,Wolferman’s, Stock Yards, Cheryl’s Fannie May (through the date of its disposition on May 30, 2017),Cookies, The Popcorn Factory, 1-800-Baskets/DesignPac, and 1-800-Baskets/DesignPac.Shari’s Berries. Revenue is derived from the sale of gourmet fruits, cookies, baked gifts, premium chocolates and confections, gourmet popcorn, gift baskets, dipped berries, and prime steaks and chops through the Company’s e-commerce sales channels (telephonic and online sales) and company-owned and operated retail stores under the Harry & David Cheryl’s and Fannie May (through the date of its disposition)Cheryl’s brand names, as well as wholesale operations.
Net revenues decreased 7.1% and 7.8%within this segment increased 8.4% during the three and six months ended December 31, 2017, respectively,September 26, 2021, compared to the same periodsperiod of the prior year, due to the dispositionto: (i) favorable e-commerce revenues of Fannie May on May 30, 2017. On a comparable basis, adjusting fiscal year 2017 revenues to exclude Fannie May, net revenues6.3% resulting from increased 2.6% and 2.8% during the three and six months ended December 31, 2017, respectively, compared to the same periodspenetration of the prior year due to growth“everyday” volume driven by the Harry & David, Cheryl’s Cookies, and 1-800-Baskets.com consumerShari’s Berries initiatives, as well as (ii) wholesale and wholesale channel brands. Comparable segmentretail revenue growth was attributable to several initiatives implemented during the second half of fiscal 2017, including: (i) the Company’s successful efforts to grow the “everyday” volume of its Gourmet Foods & Gift Baskets brands through expanded birthday and sympathy merchandise, (ii) the modernization of the Harry & David brand, which focused on developing merchandising assortments and digital marketing programs that helped to broaden the demographic reach of the brand, and, (ii) the launch of the Simply Chocolates product line, which is managed by 1-800-Baskets. As noted above, Cheryl’s revenue decrease, in comparison to the prior year, was23.4%, due to the Company’s decisionimproving demand as COVID-19 restrictions were lifted and foot-traffic in customer locations continued to suspend order taking as a result of operational issues experienced during the weeks leading upreturn to the Christmas holiday. As a result, the Company estimates that it had to forego approximately $4.0 million in holiday revenues during the three and six months ended December 31, 2017. In addition, revenues during the six months ended December 31, 2017 were negatively impacted, by approximately $0.2 million, due to hurricanes Harvey and Irma. The operational issues at Cheryl’s have been addressed, and business has returned to its normal pace.more normalized levels.
Gross profit
Gross Profit
| | | Three Months Ended | | | Six Months Ended | | | Three Months Ended | |
| | | December 31, 2017 | | | January 1, 2017 | | | % Change | | | December 31, 2017 | | | January 1, 2017 | | | % Change | | | September 26, 2021 | | | September 27, 2020 | | | % Change | |
| | | (dollars in thousands) | | | (dollars in thousands) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Gross profit | | $ | 235,259 | | | $ | 256,994 | | | | -8.5 | % | | $ | 302,537 | | | $ | 328,381 | | | | -7.9 | % | | $ | 125,514 | | | $ | 115,480 | | | 8.7 | % |
Gross profit % | | | 44.7 | % | | | 46.3 | % | | | | | | | 44.3 | % | | | 45.6 | % | | | | | | 40.6 | % | | 40.7 | % | | | |
Gross profit consists of net revenues less cost of revenues, which is comprised primarily of florist fulfillment costs (fees paid directly to florists), the cost of floral and non-floral merchandise sold from inventory or through third parties, and associated costs, including inbound and outbound shipping charges. Additionally, cost of revenues includeincludes labor and facility costs related to direct-to-consumer and wholesale production operations.operations, as well as payments made to sending florists related to order volume sent through the Company’s BloomNet network.
Gross profit decreased 8.5% and 7.9%increased 8.7% during the three and six months ended December 31, 2017, respectively, in comparisonSeptember 26, 2021, compared to the same periodsperiod of the prior year, whileas a result of the increase in revenues noted above, partially offset by slightly lower gross margin percentage. Gross profit percentage decreased 160 and 13010 basis points, during the three and six months ended December 31, 2017, respectively, in comparisonSeptember 26, 2021, compared to the same periods of the prior year. On a comparable basis, adjusting prior year gross profit to exclude Fannie May, which was disposed of on May 30, 2017, gross profit decreased 2.4% and 1.8% during the three and six months ended December 31, 2017, respectively, in comparison to the same periodsperiod of the prior year, whileprimarily due to lower margins within the Gourmet Foods & Gift Baskets segment, partially offset by higher margins within the Consumer Floral & Gifts and Bloomnet segments. On a pro-forma basis, adjusting for the impact of PersonalizationMall, gross margin percentage was 40.0% during the three months ended September 26, 2021. The lower margins reflect macro-economic headwinds including limited availability and increased costs for labor, as well as widespread delays and rising costs of inbound and outbound transportation. The Company has implemented a number of initiatives designed to mitigate the impact of these issues, including strategic pricing initiatives across our brands, as well as the investments we have made in our operating platform, consisting of pre-building inventory, deploying automation to increase throughput and reduce reliance on seasonal labor. Gross profit by segment follows:
Consumer Floral & Gifts segment - Gross profit increased by 15.9% during the three months ended September 26, 2021, compared to the same period of the prior year, as a result of the revenue increase noted above, as well as higher gross margin percentage, decreased 220 and 180which increased 130 basis points, during the same periods. The lower comparable gross profit, and gross profit percentage, primarily reflectsto 41.9%, due to the impact of the operational issue at the Company’s Cheryl’s Cookies brand,acquisition of PersonalizationMall, which carries higher margins, as well as increasedpricing initiatives, partially offset by higher component and transportation costs incosts. On a pro-forma basis, adjusting for the Gourmet Food and Gift Baskets segment, and increased promotional activity within the Consumer Floral segment in order to increase market share.
The 1-800-Flowers.com Consumer Floral segmentimpact of PersonalizationMall, gross profit decreased by 3.6% and 1.7%margin percentage was 41.1% during the three and six months ended December 31, 2017, respectively, in comparisonSeptember 26, 2021.
BloomNetsegment - Gross profit increased by 3.8% during the three months ended September 26, 2021, compared to the same period of the prior year, due to a decreasean increase in gross profitmargin percentage of 240 and 150470 basis points to 38.8% and 39.4%50.0%, respectively, partially offset by the aforementioneddecrease in revenue growth.noted above. The lower gross profit percentages reflect an increase in promotional activity initiatedgross margin percentage was due to extend the market share of the 1-800-Flowers brand, as well as an increaserevenue mix resulting from growth in Passport free shipping participation, which has improved customer loyaltyhigh margin services revenue streams, and purchase frequency.decreases in lower margin wholesale revenues and florist-to-florist volumes.
BloomNet Wire ServiceGourmet Foods & Gift Baskets segment’s gross - Gross profit decreased by 5.0% and 5.6%2.4% during the three and six months ended December 31, 2017, respectively, in comparisonSeptember 26, 2021, compared to the same period of the prior year, due to the decrease in revenues noted above, as well as decreases in gross profit percentage of 260 and 140390 basis points, to 57.4% and 56.7%35.0%, respectively,partially offset by the revenue increase noted above. The lower gross profit percentages are due to sales mix, with a decline in gross margin percentage was primarily reflecting increased costs for labor and transportation, as well as higher margin membership and related services, offset by an increase in lower margin wholesale product sales.discounts.
The Gourmet Food & Gift Baskets segment gross profit decreased by 9.7%Marketing and 10.0% during the three and six months ended December 31, 2017, respectively, in comparison to the same periods of the prior year, while gross profit percentage decreased 130 and 110 basis points to 45.4% and 44.9%, over the same respective periods. On a comparable basis, adjusting prior year gross profit to exclude Fannie May, which was disposed of on May 30, 2017, gross profit decreased 2.0% and 1.4% during the three and six months ended December 31, 2017, respectively, in comparison to the same periods of the prior year, while gross profit percentage decreased 220 and 190 basis points to 45.4% and 44.9%, over the same respective periods. The lower comparable gross profit and gross profit percentage primarily reflects the impact of the operational issue at the Company’s Cheryl’s Cookies brand, which negatively impacted gross profit by approximately $4.0 million as a result of increased labor, expedited shipping, expiring product and higher customer credits. In addition, although revenue growth provided for improved gross profit at Harry & David, higher transportation costs at Harry & David and our wholesale baskets brands negatively impacted gross profit percentage.
sales expense
Marketing and Sales Expense
| | | Three Months Ended | | | Six Months Ended | | | Three Months Ended | |
| | | December 31, 2017 | | | January 1, 2017 | | | % Change | | | December 31, 2017 | | | January 1, 2017 | | | % Change | | | September 26, 2021 | | | September 27, 2020 | | | % Change | |
| | | (dollars in thousands) | | | (dollars in thousands) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Marketing and sales | | $ | 113,771 | | | $ | 119,876 | | | | -5.1 | % | | $ | 163,493 | | | $ | 174,954 | | | | -6.6 | % | | $ | 94,379 | | | $ | 80,285 | | | 17.6 | % |
Percentage of net revenues | | | 21.6 | % | | | 21.6 | % | | | | | | | 23.9 | % | | | 24.3 | % | | | | | | 30.5 | % | | 28.3 | % | | | |
Marketing and sales expense consists primarily of advertising and promotional expenditures, catalog costs, online portal and search costs, retail store and fulfillment operations (other than costs included in cost of revenues) and customer service center expenses, as well as the operating expenses of the Company’sCompany’s departments engaged in marketing, selling and merchandising activities.
Marketing and sales expense decreased 5.1% and 6.6%increased 17.6% during the three and six months ended December 31, 2017,September 26, 2021, compared to the same periods of the prior year, due to the disposition of Fannie May on May 30, 2017. On a comparable basis, adjusting prior year marketing and sales expense to exclude Fannie May’s expenditures, marketing and sales expense increased 1.8% during both the three and six months ended December 31, 2017, in comparison to the same periodsperiod of the prior year, due to increased marketing spend withinto: (i) the Consumer Floral and Gourmet Foods & Gift Baskets segments, commensurate withvariable components of revenue growth, including(ii) the Company’s efforts to testannualization of the impact of the acquisition of PersonalizationMall, which carries both higher product gross margins, as well as higher advertising ratios, and (iii) increased digital marketing strategies duringand labor costs, reflecting the holiday season for applications throughoutcompetitive post COVID-19 environment.
During the remainderthree months ended September 26, 2021, the Company added approximately 0.9 million new e-commerce customers, a decrease of 5.3% compared to the same period of the fiscal year. These increases were partially offset by a reduction in performance based bonuses.prior year, while purchase activity from existing customers increased 13.1%.
Technology and Development Expensedevelopment expense
| | | Three Months Ended | | | Six Months Ended | | | Three Months Ended | |
| | | December 31, 2017 | | | January 1, 2017 | | | % Change | | | January 1, 2017 | | | January 1, 2017 | | | % Change | | | September 26, 2021 | | | September 27, 2020 | | | % Change | |
| | | (dollars in thousands) | | | (dollars in thousands) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Technology and development | | $ | 9,175 | | | $ | 9,849 | | | | -6.8 | % | | $ | 18,845 | | | $ | 19,337 | | | | -2.5 | % | | $ | 13,423 | | | $ | 11,603 | | | 15.7 | % |
Percentage of net revenues | | | 1.7 | % | | | 1.8 | % | | | | | | | 2.8 | % | | | 2.7 | % | | | | | | 4.3 | % | | 4.1 | % | | | |
Technology and development expense consists primarily of payroll and operating expenses of the Company’sCompany’s information technology group, costs associated with its websites, including hosting, design, content development and maintenance and support costs related to the Company’s order entry, customer service, fulfillment and database systems.
Technology and development expenses decreased 6.8% and 2.5%expense increased 15.7% during the three and six months ended December 31, 2017,September 26, 2021, compared to the same period of the prior year, primarily due to favorable hosting costsincreased consulting and labor expenses resulting from a reduction in performance based bonuses, partially offset bycosts, increased licensehosting and maintenance costs relatedincurred to security and order processing platforms.support the Company’s technology platform, in addition to the incremental costs associated with PersonalizationMall, which was acquired on August 3, 2020.
General and Administrative Expenseadministrative expense
| | | Three Months Ended | | | Six Months Ended | | | Three Months Ended | |
| | | December 31, 2017 | | | January 1, 2017 | | | % Change | | | December 31, 2017 | | | January 1, 2017 | | | % Change | | | September 26, 2021 | | | September 27, 2020 | | | % Change | |
| | | (dollars in thousands) | | | (dollars in thousands) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
General and administrative | | $ | 19,170 | | | $ | 21,551 | | | | -11.0 | % | | $ | 38,575 | | | $ | 43,484 | | | | -11.3 | % | | $ | 27,066 | | | $ | 28,213 | | | -4.1 | % |
Percentage of net revenues | | | 3.6 | % | | | 3.9 | % | | | | | | | 5.6 | % | | | 6.0 | % | | | | | | 8.7 | % | | 9.9 | % | | | |
General and administrative expense consists of payroll and other expenses in support of the Company’sCompany’s executive, finance and accounting, legal, human resources and other administrative functions, as well as professional fees and other general corporate expenses.
General and administrative expenseexpenses decreased 11.0% and 11.3%4.1% during the three and six months ended December 31, 2017, compared to the same period of the prior year, primarily due to the disposition of Fannie May on May 30, 2017. On a comparable basis, adjusting prior year general and administrative expense to exclude Fannie May’s expenditures, general and administrative expense decreased 3.9% and 3.7% during the respective three and six months ended December 31, 2017, in comparison to the same periods of the prior year, due to reductions in travel, and labor resulting from a reduction in performance based bonuses, partially offset by an increase in the value of Non-Qualified Deferred Compensation Plan investments (increase offset in Other (income) expense net line item on the financials statement – see below), and higher health insurance costs.
Depreciation and Amortization Expense
| | | Three Months Ended | | | Six Months Ended | |
| | | December 31, 2017 | | | January 1, 2017 | | | % Change | | | December 31, 2017 | | | January 1, 2017 | | | % Change | |
| | | (dollars in thousands) | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | $ | 8,677 | | | $ | 9,167 | | | | -5.3 | % | | $ | 16,761 | | | $ | 17,164 | | | | -2.3 | % |
Percentage of net revenues | | | 1.6 | % | | | 1.7 | % | | | | | | | 2.5 | % | | | 2.4 | % | | | | |
Depreciation and amortization expense for the three months ended December 31, 2017 decreased 5.3% and 2.3%, in comparisonSeptember 26, 2021, compared to the same period of the prior year, due to lower transaction and litigation costs, and lower labor costs caused by a smaller increase in the dispositionvalue of Fannie May. On a comparable basis, adjustingthe Company’s NQDC Plan assets (offset within Other (income) expenses noted below), combined with the impact of severance paid to terminated PersonalizationMall employees in the prior year depreciationyear. These decreases were partially offset by higher health insurance and facility costs.
Depreciation and amortization expense to exclude Fannie May, depreciation
| | | Three Months Ended | |
| | | September 26, 2021 | | | September 27, 2020 | | | % Change | |
| | | (dollars in thousands) | |
| | | | | | | | | | | | | |
Depreciation and amortization | | $ | 10,970 | | | $ | 8,840 | | | | 24.1 | % |
Percentage of net revenues | | | 3.5 | % | | | 3.1 | % | | | | |
Depreciation and amortization expense increased 3.9% and 7.9%24.1% during the respective three and six months ended December 31, 2017, in comparisonSeptember 26, 2021, compared to the same periodsperiod of the prior year, as a result ofdue to incremental depreciation and customer list amortization associated with PersonalizationMall, and recent shorter-livedshort-lived IT capital expenditures.related e-commerce/platform enhancements.
Interest (income) expense, net
Interest Expense, net
| | | Three Months Ended | | | Six Months Ended | |
| | | December 31, 2017 | | | January 1, 2017 | | | % Change | | | December 31, 2017 | | | January 1, 2017 | | | % Change | |
| | | (dollars in thousands) | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Interest expense, net | | $ | 1,226 | | | $ | 2,154 | | | | -43.1 | % | | $ | 2,257 | | | $ | 3,605 | | | | -37.4 | % |
| | | Three Months Ended | |
| | | September 26, 2021 | | | September 27, 2020 | | | % Change | |
| | | (dollars in thousands) | | | | | | | | | |
| | | | | | | | | | | | | |
Interest expense, net | | $ | 1,528 | | | $ | 1,040 | | | | 46.9 | % |
Interest expense, net consists primarily of interest expense and amortization of deferred financing costs attributable to the Company’sCompany’s credit facility (See Note 8 - Debt,, in Item 1.1. for details regarding the 2016 Amended Credit Facility)details), net of income earned on the Company’s available cash balances.
Interest expense, net decreased 43.1% and 37.4%increased 46.9% during the three and six months ended December 31, 2017 in comparisonSeptember 26, 2021, compared to the same periodsperiod of the prior year, as a result due to the incremental interest expense associated with the New Term Loan, which was used to partially finance the acquisition of scheduled repayment of term loan borrowingsPersonalizationMall, and funding fiscal 2018 working capital requirements primarily throughlower interest income on the use ofCompany’s outstanding cash on hand from the sale of Fannie May, in comparisonbalances due to fiscal 2017, when the Company funded working capital requirements through its revolving credit facility.lower interest rates.
Other (income) expense,income, net
| | | Three Months Ended | | | Six Months Ended | |
| | | December 31, 2017 | | | January 1, 2017 | | | % Change | | | December 31, 2017 | | | January 1, 2017 | | | % Change | |
| | | (dollars in thousands) | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Other (income) expense, net | | $ | (86 | ) | | $ | 1 | | | | 8,700 | % | | $ | (346 | ) | | $ | (149 | ) | | | 132.2 | % |
| | | Three Months Ended | |
| | | September 26, 2021 | | | September 27, 2020 | | | % Change | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Other income, net | | $ | 596 | | | $ | 999 | | | | -40.3 | % |
Other income, net for the three and six months ended December 31, 2017September 26, 2021, consists primarily of investment earnings ofgains on the Company’s Non-Qualified Deferred CompensationNQDC Plan assets, partially offset by a $0.2 million impairment related to the Company’s equity method investment in Flores Online (see Note 7 - Investmentsabove).assets.
Other (income) expense, net for the three and six months ended January 1, 2017 primarily consists of investment earnings of the Company’s Non-Qualified Deferred Compensation Plan assets for both the three and six months ended January 1, 2017, partially offset by a decrease in the Company’s equity interest in Flores Online of $0.1 million for both the three and six months ended January 1, 2017.
Income Taxes
The Company recorded an income tax expensebenefit of $12.6$8.1 million and $5.5$3.7 million, respectively, during the three and six months ended December 31, 2017September 26, 2021 and income tax expense of $31.5 million and $22.8 million, respectively, during the three and six months ended January 1, 2017.September 27, 2020, respectively. The Company’s effective tax rate for the three and six months ended December 31, 2017September 26, 2021 was 15.2% and 8.7% respectively,37.9%, compared to 33.3% and 32.6%27.7% in the same periodsperiod of the prior year. The effective ratesrate for fiscal 2018 were impacted by changes associated with the Tax Act (see Note 1 -Accounting Policies in Item 1. above). During the quarterthree months ended December 31, 2017, the Company recognized a benefit of $15.9 million, or $0.24 per diluted share related to the impact of the Tax Act, consisting of a discrete tax benefit of $12.2 million, or $0.18 per diluted share, reflecting a revaluation of deferred tax liabilities at the lower U.S. federal statutory rate of 21%,September 26, 2021 and a benefit of $3.7 million, or $0.06 per diluted share, reflecting the Company’s lower transitional federal tax rate in fiscal 2018 of 28.0 percent. In addition, fiscal 2018 effective rates were impacted by state income taxes, which were partially offset by various permanent differences and tax credits. The effective rates for fiscal 2017September 27, 2020 differed from the U.S. federal statutory rate due toof 21% primarily from excess tax benefit from stock-based compensation during the respective interim tax periods, as well as state income taxes which were more than offset by various permanent differences and tax credits, including excess tax benefits on stock based compensation as a result of the Company’s adoption of ASU 2016-09. At December 31, 2017, the Company has an unrecognized tax benefit, including an immaterial amount of accrued interest and penalties, of approximately $0.4 million. The Company believes that no significant unrecognized tax positions will be resolved over the next twelve months.nondeductible expenses for executive compensation.
Liquidity and Capital Resources
Liquidity and borrowings
The Company's principal sources of liquidity are cash on hand, cash flows generated from operations and the borrowings available under the 20162020 Credit FacilityAgreement (see Note 8 - Debt in Item 1 for details). At December 31, 2017,September 26, 2021, the Company had working capital of $172.2$110.7 million, including cash and cash equivalents of $232.6$3.8 million, compared to working capital of $132.2$134.1 million, including cash and cash equivalents of $149.7$173.6 million, at July 2, 2017. Borrowings under the Revolver (working capital needs), which were significantly lower than prior year as a result of cash generated from the sale of Fannie May, peaked in November, when cash generated from operations during the Christmas holiday shopping season enabled the Company to repay the Revolver prior to the end of December 2017. June 27, 2021.
Due to the seasonal nature of the Company’s business, and its continued expansion into non-floral products, the Thanksgiving through Christmas holiday season, which falls within the Company’s second fiscal quarter, is expected to generatehistorically generated nearly 50% of the Company’s annual revenues, and all of its earnings. As a result,However, with the onset of the pandemic of COVID-19, our customers have increasingly turned to our brands and our expanded product offerings to help them connect and express themselves, and our “everyday” gifting product line has seen increased volume. While the continuing impacts of COVID-19 are difficult to predict, the Company expects that its fiscal second quarter will continue to be its largest in terms of revenues and earnings, although the aforementioned increase in the Company’s “everyday” business has and is expected to continue to lessen the seasonality of our business.
During the first quarter of fiscal 2022, the Company did not borrow under its revolving credit agreement. Working capital borrowings typically peak in November, after which time cash generated significant cash from operations during its second quarter, which, after re-paying all borrowings outstanding under its Revolver, isthe Christmas holiday shopping season are expected to be sufficient to provide for operating needs until the second quarter of fiscal 2019, whenenable the Company expects to borrow againstrepay such borrowings. In addition, on October 27, 2021, the Company completed its Revolveracquisition of Vital Choice, a provider of premium wild-caught seafood and sustainably farmed shellfish, pastured proteins, organic foods, and marine-sourced nutritional supplements. The Company utilized its existing credit facility to fund pre-holiday manufacturingthe $20.0 million purchase (subject to certain working capital and inventory purchases.other adjustments).
WeWhile we believe that our sources of funding will be sufficient to meet our anticipated operating cash needs for at leastleast the next 12 months. However,twelve months, any projections of future cash needs and cash flows are subject to substantial uncertainty. We continually evaluate, opportunities to repurchase common stock and we will, from time to time, consider the acquisition of, or investment in, complementary businesses, products, services, capital infrastructure, and technologies, which might affect our liquidity requirements or cause us to require additional financing.
To date, we have not identified any material liquidity deficiencies as a result of the COVID-19 pandemic. Based on the information currently available to us, we do not expect the impact of COVID-19 to have a negative impact on our liquidity. We will continue to monitor and assess the impact COVID-19 may have on our business and financial results. See Part II. Item 1A.“Risk Factors” and Part I. Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further information.
Cash Flows
Net cash provided byused in operating activities of $114.2$150.2 million, for the six months ended December 31, 2017,first quarter of fiscal 2022, was primarily attributable to the Company’s net incomeloss during the period, adjusted by non-cash charges for depreciation/amortization, deferred income taxes (including the impact of the Tax Act – see Note 1 -Accounting Policies and Note 11 – Income taxes in Item 1 above) and stock based compensation, as well ascombined with seasonal changes in working capital, including holiday related increases in accounts payableinventory, trade receivables and accrued expenses,prepaid and reductions in inventory,other, partially offset by increases in receivables related to holiday season sales.non-cash charges for depreciation and amortization and stock-based compensation.
Net cash used in investing activities of $17.4$11.1 million, for the six months ended December 31, 2017,first quarter of fiscal 2022, was primarily attributable to the working capital adjustment related to the sale of Fannie May, of which $8.5 million was still due to Ferrero at July 2, 2017 and to capital expenditures related to the Company's technology initiatives, and Gourmet Foods & Gift Basket segmentas well as manufacturing production and orchard plantingwarehousing equipment.
Net cash used in financing activities of $13.9$8.5 million, for the six months ended December 31, 2017first quarter of fiscal 2022, was primarily due to Term Loan repayments of $2.9 million and the acquisition of $11.1 million of treasury stock. All borrowings under the Company's revolving credit facility were repaid by the end of the fiscal second quarter.
Stock Repurchase Program
The Company has a stock repurchase plan through which purchases can be made from time to time in the open market and through privately negotiated transactions, subject to general market conditions. The repurchase program is financed utilizing available cash. On August 30, 2017, the Company’s Board of Directors authorized an increase to its stock repurchase plan of up to $30.0 million. As of December 31, 2017, $21.1 million remained authorized under the plan.
Contractual Obligations
There have been no material changes outside the ordinary course of business related to the Company’s contractual obligations as discussed in the Annual Report on Form 10-K for the year ended July 2, 2017.
Stock Repurchase Program
See Item 2 in Part II below for details.
Contractual Obligations
At September 26, 2021, the Company’s contractual obligations consist of:
● | Long-term debt obligations - payments due under the Company's 2020 Credit Agreement (see Note 8 - Debt in Item 1 for details and payments due by period). |
● | Operating lease obligations – payments due under the Company’s operating leases (see Note 13 - Leases in Item 1 for details and payments due by period for the long-term operating leases). |
● | Purchase commitments - consisting primarily of inventory and IT related equipment purchase orders and license agreements made in the ordinary course of business – see below for the contractual payments due by period. |
| | | Payments due by period | |
| | | (in thousands) | |
| | | Remaining Fiscal 2022 | | | Fiscal 2023 | | | Fiscal 2024 | | | Fiscal 2025 | | | Fiscal 2026 | | | Thereafter | | | Total | |
Purchase commitments | | $ | 175,121 | | | $ | 8,158 | | | $ | 5,941 | | | $ | 3,750 | | | $ | 2,000 | | | $ | - | | | $ | 194,970 | |
Critical Accounting Policies and Estimates
As disclosed in the Company’s Company’s Annual Report on Form 10-K for the fiscal year ended July 2, 2017,June 27, 2021, the discussion and analysis of the Company’s financial condition and results of operations are based upon the consolidated financial statements, of 1-800-FLOWERS.COM, Inc., which have been prepared in conformity with U.S. generally accepted accounting principles. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. Management bases its estimates and assumptions on historical experience and on various other factors that are believed to be reasonable under the circumstances, and management evaluates its estimates and assumptions on an ongoing basis. Actual results may differ from these estimates under different assumptions or conditions. The Company’s most critical accounting policies relate to revenue recognition, accounts receivable, inventory, goodwill, other intangible assets and long-lived assets and income taxes. There have been no significant changes to the assumptions and estimates related to the Company’s critical accounting policies, since July 2, 2017, except for the enactment of the Tax Act (seeJune 27, 2021.
Recently Issued Accounting Pronouncements
See Note 1 -Accounting Policies and Note 11 – Income taxes in Item 1 above for details).
Recent Accounting Pronouncements
In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers.” This amended guidance will enhance the comparability of revenue recognition practices and will be applied to all contracts with customers. Expanded disclosures related to the nature, amount, timing, and uncertainty of revenue that is recognized are requirements under the amended guidance. As we continue to evaluatedetails regarding the impact of this ASU, we have determinedaccounting standards that the new standard will impact the following areas: the costs of producing and distributing the Company’s catalogs will be expensed upon shipment, instead of being capitalized and amortized in direct proportion to the actual sales; gift card breakage will be estimated based on the historical pattern of gift card redemption, rather than when redemption is considered remote; the Company will defer revenue at the time the Celebrations Reward loyalty points are earned using a relative fair value approach, rather than accruing a liability equal to the incremental cost of fulfilling its obligations. We have further identified the timing of revenue recognition for e-commerce orders (shipping point versus destination) as a potential issue in our analysis, which is not expected to change the total amount of revenue recognized, but could accelerate the timing of when revenue is recognized. We plan to adopt this guidance beginning with the first quarter in the fiscal year ending June 30, 2019 on a retrospective basis with a cumulative adjustment to retained earnings. We are continuing to evaluate the impact that this ASU, and related amendments and interpretive guidance, will have on our consolidated financial statements, including the related disclosures.
In July 2015, the FASBwere recently issued ASU No. 2015-11, “Inventory (Topic 330).” The pronouncement was issued to simplify the measurement of inventory and changes the measurement from lower of cost or market to lower of cost and net realizable value. The Company adopted this standard effective July 3, 2017. The adoption of ASU 2015-11 did not have a significant impact on the Company’s consolidated financial position or results of operations.
In January 2016, the FASB issued ASU No. 2016-01, "Financial Instruments – Overall: Recognition and Measurement of Financial Assets and Financial Liabilities." The pronouncement requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income, requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset, and eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. This guidance will become effective for the Company's fiscal year ending June 30, 2019. The adoption is not expected to have a significant impact on the Company’s consolidated financial statements.
In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842).” Under this guidance, an entity is required to recognize right-of-use assets and lease liabilities on its balance sheet and disclose key information about leasing arrangements. This guidance offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. This guidance is effective for the Company’s fiscal year ending June 28, 2020. We are currently evaluating the impact and expect the ASU will have a material impact on our consolidated financial statements, primarily to the consolidated balance sheets and related disclosures.
In March 2016, the FASB issued ASU No. 2016-09, “Improvements to Employee Share-Based Payment Accounting.” ASU No. 2016-09 affects all entities that issue share-based payment awards to their employees. ASU No. 2016-09 simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The Company elected to early adopt the amendments in ASU 2016-09, in fiscal 2017. As a result, stock-based compensation excess tax benefits are reflected in the Consolidated Statements of Income as a component of the provision for income taxes, whereas they were previously recognized in equity. This change resulted in the recognition of excess tax benefits against income tax expenses, rather than additional paid-in capital, of $1.0 million for the year ended July 2, 2017. There was no impact on earnings per share since approximately 700,000 tax benefit shares for the year ended July 2, 2017, previously associated with the APIC pool calculation, are no longer considered in the diluted share computation. Additionally, our Consolidated Statements of Cash Flows now present excess tax benefits as an operating activity. This change has been applied prospectively in accordance with the ASU and prior periods have not been adjusted. Further, the Company has elected to account for forfeitures as they occur, rather than estimate expected forfeitures. The cumulative effect of this change, which was recorded as compensation expense in fiscal 2017, was not material to the financial statements. In addition, this ASU allows entities to withhold an amount up to an employees’ maximum individual statutory tax rate in the relevant jurisdiction, up from the minimum statutory requirement, without resulting in liability classification of the award. We adopted this change on a modified retrospective basis, with no impact to our consolidated financial statements. Finally, this ASU clarified that the cash paid by an employer when directly withholding shares for tax withholding purposes should be classified as a financing activity. This change does not have an impact on the Company’s consolidated financials as it conforms with its current practice.
In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 introduces a new forward-looking “expected loss” approach, to estimate credit losses on most financial assets and certain other instruments, including trade receivables. The estimate of expected credit losses will require entities to incorporate considerations of historical information, current information and reasonable and supportable forecasts. This ASU also expands the disclosure requirements to enable users of financial statements to understand the entity’s assumptions, models and methods for estimating expected credit losses. ASU 2016-13 is effective for the Company’s fiscal year ending July 4, 2021, and the guidance is to be applied using the modified-retrospective approach. The Company is currently evaluating the potential impact of adopting this guidance on our consolidated financial statements.
In June 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230), a consensus of the FASB’s Emerging Issues Task Force.” ASU 2016-15 is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. The ASU is effective for the Company’s fiscal year ending June 30, 2019, and interim periods within those fiscal years. Early adoption is permitted, including interim periods within those fiscal years. An entity that elects early adoption must adopt all of the amendments in the same period. The guidance requires application using a retrospective transition method. The adoption is not expected to have a significant impact on the Company’s consolidated financial statements.
In January 2017, the FASB issued ASU No. 2017-01, "Business Combinations (Topic 805): Clarifying the Definition of a Business (ASU 2017-01)," which revises the definition of a business and provides new guidance in evaluating when a set of transferred assets and activities is a business. ASU 2017-01 is effective for the Company's fiscal year ending June 30, 2019, with early adoption permitted, and should be applied prospectively. We do not expect the standard to have a material impact on our consolidated financial statements.
In January 2017, the FASB issued ASU No. 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment," which eliminates step two from the goodwill impairment test. Under ASU 2017-04, an entity should recognize an impairment charge for the amount by which the carrying amount of a reporting unit exceeds its fair value up to the amount of goodwill allocated to that reporting unit. This guidance is effective for the Company’s fiscal year ending July 4, 2021, with early adoption permitted, and should be applied prospectively. We do not expect the standard to have a material impact on our consolidated financial statements.
In February 2017, the FASB issued ASU No. 2017-05, “Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets.” This update clarifies the scope of accounting for the derecognition or partial sale of nonfinancial assets to exclude all businesses and nonprofit activities. ASU 2017-05 also provides a definition for in-substance nonfinancial assets and additional guidance on partial sales of nonfinancial assets. This guidance will be effective for the Company’s fiscal year ending June 30, 2019 and may be applied retrospectively. The Company is currently evaluating the potential impact of adopting this guidance on our consolidated financial statements.
In May 2017, the FASB issued ASU No 2017-09, “Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting.” This ASU provides guidance on the types of changes to the terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting. An entity would not apply modification accounting if the fair value, vesting conditions, and classification of the awards are the same immediately before and after the modification. ASU 2017-09 is effective for the Company's fiscal year ending June 30, 2019, with early adoption permitted, and should be applied prospectively to an award modified on or after the adoption date. The Company is currently evaluating the potential impact of adopting this guidance on our consolidated financial statements.
Forward Looking Information and Factors that May Affect Future Results
Our disclosure and analysis in this report contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent the Company’sCompany’s current expectations or beliefs concerning future events and can generally be identified by the use of statements that include words such as “estimate,” “project,” “believe,” “anticipate,” “intend,” “plan,” “foresee,” “likely,” “will,” “goal,” “target” or similar words or phrases. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of the Company’s control that could cause actual results to differ materially from the results expressed or implied in the forward-looking statements, including:
| ● | the Company’sCompany’s ability: |
| o | to achieve revenue and profitability; |
| o | to leverage its operating platform and reduce operating expenses; |
| o | to manage the increased seasonality of its business; |
| o | to cost effectively acquire and retain customers; |
| o | to effectively integrate and grow acquired companies; |
| o | to reduce working capital requirements and capital expenditures; |
| o | to compete against existing and new competitors; |
| o | to manage expenses associated with sales and marketing and necessary general and administrative and technology investments; and |
| o | to cost efficientlyeffectively manage inventories; |
| ● | the outcome of contingencies, including legal proceedings in the normal course of business; andbusiness |
| ● | general consumer sentiment and economic conditions that may affect levels of discretionary customer purchases of the Company’s products.Company’s products; and |
● | the impact of COVID-19 on our business and financial statements. |
We cannot guarantee that any forward-looking statement will be realized, although we believe we have been prudent in our plans and assumptions. Achievement of future results is subject to risks, uncertainties and inaccurate assumptions. Should known or unknown risks or uncertainties materialize, or should underlying assumptions prove inaccurate, actual results could vary materially from past results and those anticipated, estimated or projected. Investors should bear this in mind as they consider forward-looking statements.
We undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. You are advised, however, to consult any further disclosures we make on related subjects in our Forms 10-Q, 8-K and 10-K reports to the Securities and Exchange Commission. Our Annual Report on Form 10-K filing for the fiscal year ended July 2, 2017June 27, 2021, listed various important factors that could cause actual results to differ materially from expected and historic results. We note these factors for investors as permitted by the Private Securities Litigation Reform Act of 1995. Readers can find them in Part I, Item 1A, of that filing under the heading “Cautionary Statements Under the Private Securities Litigation Reform Act of 1995”. We incorporate that section of that Form 10-K in this filing and investors should refer to it.
in this Form 10-Q.
ITEM 3.3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company is exposed to market risk from the effect of interest rate changes.
Interest Rate Risk
The Company’sCompany’s exposure to market risk for changes in interest rates relates primarily to the Company’s investment of available cash balances and its long-term debt. The Company generally invests its cash and cash equivalents in investment grade corporate and U.S. government securities. Due to the currently low rates of return the Company is receiving on its cash equivalents, the potential for a significant decrease in short-term interest rates is low and, therefore, a further decrease would not have a material impact on the Company’s interest income. Borrowings under the Company’s credit facility2020 Credit Agreement bear interest at a variable rate, plus an applicable margin, and therefore expose the Company to market risk for changes in interest rates. The effect of a 50 basis point increase in current interest rates on the Company’s interest expense would be approximately $0.2 and $0.3 million during the three and six months ended December 31, 2017,September 26, 2021, respectively.
ITEM 4.4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
The Company’sCompany’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as of December 31, 2017.September 26, 2021. Based on that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of December 31, 2017.September 26, 2021.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting identified in connection with the Company’sCompany’s evaluation required by Rules 13a-15(d) or 15d-15(d) of the Securities Exchange Act of 1934 during the quarter ended December 31, 2017,September 26, 2021, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
To the extent our normal procedures and controls related to our financial close or other reporting processes were adversely impacted by the COVID-19 outbreak, we took appropriate actions and safeguards to reasonably ensure the fair presentation of the financial statements in accordance with GAAP.
PART II. II. – OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Litigation
ThereBed Bath & Beyond:
On April 1, 2020, the Seller commenced an action against the Company in the Court of Chancery for the State of Delaware, which is captioned Bed Bath & Beyond Inc. v. 1-800-Flowers.com, et ano., C.A. (the “Complaint”), alleging a breach of the Equity Purchase Agreement (the “Purchase Agreement”), dated February 14, 2020, between Seller, PersonalizationMall, the Company and the Purchaser, pursuant to which the Seller agreed to sell to Purchaser, and the Purchaser agreed to purchase from Seller, all of the issued and outstanding membership interests of PersonalizationMall. The action was initiated after the Company requested a reasonable delay in the closing under the Purchase Agreement due to the unprecedented circumstances created by COVID-19. The Complaint requested an order of specific performance to consummate the transaction under the Purchase Agreement plus attorney’s fees and costs in connection with the action. The Company filed its answer to the Complaint on April 17, 2020 and an order governing expedited proceedings was approved on April 9, 2020 that set a trial date for late September 2020. On July 21, 2020, the Company and Seller entered into a settlement agreement, pursuant to which the Company agreed to move forward with its purchase of PersonalizationMall for $245.0 million, subject to certain working capital and other adjustments. The transaction closed on August 3, 2020. In connection with the settlement agreement, the parties executed a Stipulation and Proposed Order of Dismissal, resulting in the voluntary dismissal with prejudice of the litigation relating to the transaction.
In addition, there are various claims, lawsuits, and pending actions against the Company and its subsidiaries incident to the operations of its businesses. It is the opinion of management, after consultation with counsel, that the ultimatefinal resolution of such claims, lawsuits and pending actions will not have a material adverse effect on the Company's consolidated financial position, results of operations or liquidity.
ITEM 1A.1A.RISK FACTORS.
There were no material changes to the Company’sCompany’s risk factors as discussed in Part 1, Item 1A-Risk Factors in the Company’s Annual Report on Form 10-K for the year ended July 2, 2017.
.
ITEM 2.2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
The Company has a stock repurchase plan through which purchases can be made from time to time in the open market and through privately negotiated transactions, subject to general market conditions. The repurchase program is financed utilizing available cash. On August 30, 2017,April 22, 2021, the Company’sCompany’s Board of Directors authorized an increase to its stock repurchase plan of up to $30.0$40.0 million. As of December 31, 2017, $21.1September 26, 2021, $23.4 million remained authorized under the plan.
The following table sets forth, for the months indicated, the Company’sCompany’s purchase of common stock during the first sixthree months of fiscal 2018,2022, which includes the period July 3, 2017June 28, 2021 through December 31, 2017:September 26, 2021:
Period | | Total Number of Shares Purchased | | | Average Price Paid Per Share (1) | | | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | | | Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs | |
| | | (in thousands, except average price paid per share) | | | | | |
| | | | | | | | | | | | | | | | | |
07/03/17 - 07/30/17 | | | 89.3 | | | $ | 9.66 | | | | 89.3 | | | $ | 16,363 | |
07/31/16 - 08/27/17 | | | 99.6 | | | $ | 9.08 | | | | 99.6 | | | $ | 15,456 | |
08/28/17 - 10/01/17 | | | 268.7 | | | $ | 9.43 | | | | 268.7 | | | $ | 27,859 | |
10/02/17 - 10/29/17 | | | 233.5 | | | $ | 9.62 | | | | 233.5 | | | $ | 25,606 | |
10/30/17 - 12/03/17 | | | 414.3 | | | $ | 9.36 | | | | 414.3 | | | $ | 21,719 | |
12/04/17 - 12/31/17 | | | 61.9 | | | $ | 10.16 | | | | 61.9 | | | $ | 21,089 | |
| | | | | | | | | | | | | | | | | |
Total | | | 1,167.3 | | | $ | 9.47 | | | | 1,167.3 | | | | | |
Period | | Total Number of Shares Purchased | | | Average Price Paid Per Share (1) | | | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | | | Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs | |
| | | (in thousands, except average price paid per share) | | | | | |
| | | | | | | | | | | | | | | | | |
06/28/21 - 07/25/21 | | | 34,835 | | | $ | 30.03 | | | | 34,835 | | | $ | 31,409 | |
07/26/21 - 08/22/21 | | | 99,602 | | | $ | 31.07 | | | | 99,602 | | | $ | 28,312 | |
08/23/21 - 09/26/21 | | | 153,589 | | | $ | 32.01 | | | | 153,589 | | | $ | 23,393 | |
| | | | | | | | | | | | | | | | | |
Total | | | 288,026 | | | $ | 31.44 | | | | 288,026 | | | | | |
(1) | (1) Average price per share excludes commissions and other transaction fees.
|
ITEM 3.3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5.5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS
* Filed herewith.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| 1-800-FLOWERS.COM, Inc. (Registrant)
|
Date: February 9, 2017 November 5, 2021 | /s/ Christopher G. McCann Christopher G. McCann
Chief Executive Officer,
Director and President
(Principal Executive Officer) |
| |
Date: February 9, 2017 November 5, 2021 | /s/ William E. Shea
William E. Shea
Senior Vice President, Treasurer and
Chief Financial Officer (Principal
Financial and Accounting Officer) |
35
