Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Nov. 01, 2020 | Dec. 03, 2020 | |
Document Type | 10-Q | |
Document Period End Date | Nov. 1, 2020 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-35979 | |
Entity Registrant Name | HD SUPPLY HOLDINGS, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 26-0486780 | |
Entity Address, Address Line One | 3400 Cumberland Boulevard SE | |
Entity Address, City or Town | Atlanta | |
Entity Address, State or Province | GA | |
Entity Address, Postal Zip Code | 30339 | |
City Area Code | 770 | |
Local Phone Number | 852-9000 | |
Title of 12(b) Security | HD Supply Holdings, Inc. common stock, par value $0.01 per share | |
Trading Symbol | HDS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001573097 | |
Current Fiscal Year End Date | --02-02 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
HD Supply Holdings, Inc. | ||
Entity Common Stock, Shares Outstanding | 155,159,403 | |
HD Supply, Inc. | ||
Entity File Number | 333-159809 | |
Entity Registrant Name | HD SUPPLY, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 75-2007383 | |
Entity Address, Address Line One | 3400 Cumberland Boulevard SE | |
Entity Address, City or Town | Atlanta | |
Entity Address, State or Province | GA | |
Entity Address, Postal Zip Code | 30339 | |
City Area Code | 770 | |
Local Phone Number | 852-9000 | |
Entity Current Reporting Status | No | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 1,000 | |
Entity Central Index Key | 0001465264 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (HD Supply Holdings, Inc.) - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 01, 2020 | Nov. 03, 2019 | Nov. 01, 2020 | Nov. 03, 2019 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME | ||||
Net Sales | $ 827.5 | $ 825.2 | $ 2,269 | $ 2,426 |
Cost of sales | 479.2 | 473.2 | 1,311 | 1,388.4 |
Gross Profit | 348.3 | 352 | 958 | 1,037.6 |
Operating expenses: | ||||
Selling, general, and administrative | 205.7 | 209.3 | 597.6 | 625.9 |
Depreciation and amortization | 17.7 | 15.5 | 52.1 | 45.2 |
Restructuring and separation | 3.9 | 1.3 | 7.6 | (0.4) |
Total operating expenses | 227.3 | 226.1 | 657.3 | 670.7 |
Operating Income | 121 | 125.9 | 300.7 | 366.9 |
Interest expense | 22 | 27.4 | 71.1 | 83.4 |
Loss on extinguishment & modification of debt | 5.5 | 5.5 | ||
Other (income) expense, net | 43.6 | 43.6 | ||
Income from Continuing Operations Before Provision for Income Taxes | 49.9 | 98.5 | 180.5 | 283.5 |
Provision for income taxes | 14.4 | 25.1 | 46.6 | 71.1 |
Income from Continuing Operations | 35.5 | 73.4 | 133.9 | 212.4 |
Income from discontinued operations, net of tax | 1,572.7 | 58.5 | 1,677.3 | 161.3 |
Net Income | 1,608.2 | 131.9 | 1,811.2 | 373.7 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustment | 14.7 | 15 | 0.2 | |
Unrealized gain (loss) on cash flow hedge, net of tax of $(12.5), $0.1, $(7.5), and $7.1 | 35.6 | (0.3) | 21.1 | (20.5) |
Total Comprehensive Income | $ 1,658.5 | $ 131.6 | $ 1,847.3 | $ 353.4 |
Weighted Average Common Shares Outstanding (thousands) | ||||
Basic | 159,057 | 164,638 | 160,271 | 168,062 |
Diluted | 159,804 | 165,142 | 160,753 | 168,645 |
Basic Earnings Per Share(1): | ||||
Income from Continuing Operations (in dollars per share) | $ 0.22 | $ 0.45 | $ 0.84 | $ 1.26 |
Income from Discontinued Operations (in dollars per share) | 9.89 | 0.36 | 10.47 | 0.96 |
Net Income (in dollars per share) | 10.11 | 0.80 | 11.30 | 2.22 |
Diluted Earnings Per Share(1): | ||||
Income from Continuing Operations (in dollars per share) | 0.22 | 0.44 | 0.83 | 1.26 |
Income from Discontinued Operations (in dollars per share) | 9.84 | 0.35 | 10.43 | 0.96 |
Net Income (in dollars per share) | $ 10.06 | $ 0.80 | $ 11.27 | $ 2.22 |
CONSOLIDATED STATEMENTS OF OP_2
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Parenthetical) (HD Supply Holdings, Inc.) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 01, 2020 | Nov. 03, 2019 | Nov. 01, 2020 | Nov. 03, 2019 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME | ||||
Unrealized gain (loss) on cash flow hedge, tax | $ (12.5) | $ 0.1 | $ (7.5) | $ 7.1 |
CONSOLIDATED BALANCE SHEETS (HD
CONSOLIDATED BALANCE SHEETS (HD Supply Holdings, Inc.) - USD ($) $ in Millions | Nov. 01, 2020 | Feb. 02, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 2,315 | $ 34.4 |
Receivables, less allowance for credit losses of $10.2 and $7.6 | 400.1 | 362.1 |
Inventories | 388.6 | 427.1 |
Current assets of discontinued operations | 748 | |
Other current assets | 73.6 | 91.3 |
Total current assets | 3,177.3 | 1,662.9 |
Property and equipment, net | 260.2 | 271.2 |
Operating lease right of-use assets | 228.7 | 233.2 |
Goodwill | 1,604.5 | 1,604.5 |
Intangible assets, net | 59.8 | 68.4 |
Deferred tax assets | 3.8 | 2.1 |
Non-current assets of discontinued operations | 861.5 | |
Other assets | 9.2 | 11.7 |
Total assets | 5,343.5 | 4,715.5 |
Current liabilities: | ||
Accounts payable | 270 | 218.7 |
Accrued compensation and benefits | 40.8 | 37.9 |
Current installments of long-term debt | 10.7 | 10.7 |
Current lease liabilities | 51 | 50.8 |
Accrued income taxes | 282.3 | |
Current liabilities of discontinued operations | 341.2 | |
Other current liabilities | 201.1 | 154.8 |
Total current liabilities | 855.9 | 814.1 |
Long-term debt, excluding current installments | 1,250.8 | 2,035.4 |
Deferred tax liabilities | 22 | 32.7 |
Long-term lease liabilities | 186.6 | 192.6 |
Non-current liabilities of discontinued operations | 203.8 | |
Other liabilities | 75.9 | 84.7 |
Total liabilities | 2,391.2 | 3,363.3 |
Stockholders' equity: | ||
Common stock, par value $0.01; 1 billion shares authorized; 155.6 million and 161.4 million shares issued and outstanding at November 1, 2020 and February 2, 2020, respectively | 2.1 | 2 |
Paid-in capital | 4,117.2 | 4,097.4 |
Retained earnings (accumulated deficit) | 689.1 | (1,122.1) |
Accumulated other comprehensive loss | (16) | (52.1) |
Treasury stock, at cost, 50.6 million and 44.1 million shares at November 1, 2020 and February 2, 2020, respectively | (1,840.1) | (1,573) |
Total stockholders' equity | 2,952.3 | 1,352.2 |
Total liabilities and stockholders' equity | $ 5,343.5 | $ 4,715.5 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (HD Supply Holdings, Inc.) - USD ($) shares in Millions, $ in Millions | Nov. 01, 2020 | Feb. 02, 2020 |
Receivables | ||
Receivables, allowance for credit losses | $ 10.2 | $ 7.6 |
Common stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,000 | 1,000 |
Common stock, shares issued | 155.6 | 161.4 |
Common stock, shares outstanding | 155.6 | 161.4 |
Treasury stock | ||
Treasury stock, shares | 50.6 | 44.1 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (HD Supply Holdings, Inc.) - USD ($) $ in Millions | 9 Months Ended | |
Nov. 01, 2020 | Nov. 03, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 1,811.2 | $ 373.7 |
Reconciliation of net income to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 78.2 | 82.7 |
Provision for credit losses | 11.8 | 7.4 |
Non-cash interest expense | 4.5 | 4.6 |
Loss on extinguishment & modification of debt | 5.5 | |
Gain on sale of business | (1,762) | |
Stock-based compensation expense | 14.7 | 18.1 |
Deferred income taxes | (27.4) | 101.8 |
Other | 2.7 | |
Changes in assets and liabilities, net of the effects of acquisitions & dispositions: | ||
(Increase) decrease in receivables | (83.1) | (133.7) |
(Increase) decrease in inventories | 17.3 | (34.3) |
(Increase) decrease in other current assets | 8.2 | (2.5) |
(Increase) decrease in other assets | (2.1) | 0.3 |
Increase (decrease) in accounts payable and accrued liabilities | 425.2 | 75.8 |
Increase (decrease) in other long term liabilities | 21.9 | |
Net cash provided by (used in) operating activities | 523.9 | 496.6 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Capital expenditures | (54.6) | (89.1) |
Proceeds from sales of property and equipment | 0.3 | 2.7 |
Proceeds from sales of businesses, net | 2,845.5 | |
Payments for businesses acquired, net of cash acquired | (9.4) | |
Net cash provided by (used in) investing activities | 2,791.2 | (95.8) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Purchase of treasury shares | (246.9) | (320.5) |
Repayments of long-term debt | (532.3) | (8) |
Repayments of financing liabilities | (87.9) | |
Borrowings on long-term revolver debt | 434.1 | 978 |
Repayments on long-term revolver debt | (693.6) | (964.3) |
Proceeds from issuance of common stock under employee benefit plans | 8.9 | 6.8 |
Tax withholdings on stock-based awards | (3.8) | (5.5) |
Debt issuance and modification costs | (0.1) | |
Other financing activities | (1) | (0.8) |
Net cash provided by (used in) financing activities | (1,034.6) | (402.3) |
Effect of exchange rates on cash and cash equivalents | 0.1 | |
Increase (decrease) in cash and cash equivalents | 2,280.6 | (1.5) |
Cash and cash equivalents at beginning of period | 34.4 | 38 |
Cash and cash equivalents at end of period | $ 2,315 | $ 36.5 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY (HD Supply Holdings, Inc.) - USD ($) shares in Thousands, $ in Millions | Common Stock | Paid-in Capital | Retained Earnings (Accumulated Deficit)Cumulative effect of accounting change | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Total |
Beginning balance at Feb. 03, 2019 | $ 2 | $ 4,067.2 | $ (1,571.5) | $ (30.7) | $ (1,186) | ||
Beginning balance (in shares) at Feb. 03, 2019 | 204,806 | (34,153) | |||||
Increase (decrease) in stockholders' equity | |||||||
Net shares issued (forfeited) under employee benefit plans (in shares) | 597 | ||||||
Net income | 373.7 | $ 373.7 | |||||
Foreign currency translation adjustment | 0.2 | 0.2 | |||||
Unrealized gain (loss) on cash flow hedge, net of tax of $(12.5), $0.1, $(7.5), and $7.1 | (20.5) | (20.5) | |||||
Purchase of common stock | $ (322.8) | ||||||
Purchase of common stock (in shares) | (8,320) | ||||||
Shares issued under employee benefit plans | 6.8 | ||||||
Stock-based compensation | 17.8 | ||||||
Shares withheld for taxes | $ (5.4) | ||||||
Shares withheld for taxes (in shares) | (127) | ||||||
Other | (0.1) | ||||||
Ending balance at Nov. 03, 2019 | $ 2 | 4,091.8 | $ (2.5) | (1,200.4) | (51) | $ (1,514.2) | $ 1,328.2 |
Ending balance (in shares) at Nov. 03, 2019 | 205,403 | (42,600) | 162,803 | ||||
Beginning balance at Aug. 04, 2019 | $ 2 | 4,086.1 | (1,332.2) | (50.7) | $ (1,273.9) | ||
Beginning balance (in shares) at Aug. 04, 2019 | 205,409 | (36,338) | |||||
Increase (decrease) in stockholders' equity | |||||||
Net shares issued (forfeited) under employee benefit plans (in shares) | (6) | ||||||
Net income | 131.9 | $ 131.9 | |||||
Unrealized gain (loss) on cash flow hedge, net of tax of $(12.5), $0.1, $(7.5), and $7.1 | (0.3) | (0.3) | |||||
Purchase of common stock | $ (240.1) | ||||||
Purchase of common stock (in shares) | (6,254) | ||||||
Shares issued under employee benefit plans | 0.1 | ||||||
Stock-based compensation | 5.6 | ||||||
Shares withheld for taxes | $ (0.2) | ||||||
Shares withheld for taxes (in shares) | (8) | ||||||
Other | (0.1) | ||||||
Ending balance at Nov. 03, 2019 | $ 2 | 4,091.8 | $ (2.5) | (1,200.4) | (51) | $ (1,514.2) | $ 1,328.2 |
Ending balance (in shares) at Nov. 03, 2019 | 205,403 | (42,600) | 162,803 | ||||
Beginning balance at Feb. 02, 2020 | $ 2 | 4,097.4 | (1,122.1) | (52.1) | $ (1,573) | $ 1,352.2 | |
Beginning balance (in shares) at Feb. 02, 2020 | 205,473 | (44,071) | |||||
Increase (decrease) in stockholders' equity | |||||||
Net shares issued (forfeited) under employee benefit plans | $ 0.1 | ||||||
Net shares issued (forfeited) under employee benefit plans (in shares) | 755 | ||||||
Net income | 1,811.2 | 1,811.2 | |||||
Foreign currency translation adjustment | 15 | 15 | |||||
Unrealized gain (loss) on cash flow hedge, net of tax of $(12.5), $0.1, $(7.5), and $7.1 | 21.1 | 21.1 | |||||
Purchase of common stock | $ (267.3) | ||||||
Purchase of common stock (in shares) | (6,564) | ||||||
Shares issued under employee benefit plans | 5.2 | $ 3.8 | |||||
Shares issued under employee benefit plans (in shares) | 105 | ||||||
Stock-based compensation | 14.9 | ||||||
Shares withheld for taxes | (0.1) | $ (3.7) | |||||
Shares withheld for taxes (in shares) | (100) | ||||||
Other | (0.2) | $ 0.1 | |||||
Ending balance at Nov. 01, 2020 | $ 2.1 | 4,117.2 | 689.1 | (16) | $ (1,840.1) | $ 2,952.3 | |
Ending balance (in shares) at Nov. 01, 2020 | 206,228 | (50,630) | 155,598 | ||||
Beginning balance at Aug. 02, 2020 | $ 2.1 | 4,109.9 | (919) | (66.3) | $ (1,577) | ||
Beginning balance (in shares) at Aug. 02, 2020 | 206,179 | (44,196) | |||||
Increase (decrease) in stockholders' equity | |||||||
Net shares issued (forfeited) under employee benefit plans (in shares) | 49 | ||||||
Net income | 1,608.2 | $ 1,608.2 | |||||
Foreign currency translation adjustment | 14.7 | 14.7 | |||||
Unrealized gain (loss) on cash flow hedge, net of tax of $(12.5), $0.1, $(7.5), and $7.1 | 35.6 | 35.6 | |||||
Purchase of common stock | $ (264.4) | ||||||
Purchase of common stock (in shares) | (6,467) | ||||||
Shares issued under employee benefit plans | 4.8 | $ 1.4 | |||||
Shares issued under employee benefit plans (in shares) | 37 | ||||||
Stock-based compensation | 2.7 | ||||||
Shares withheld for taxes | $ (0.2) | ||||||
Shares withheld for taxes (in shares) | (4) | ||||||
Other | (0.2) | (0.1) | $ 0.1 | ||||
Ending balance at Nov. 01, 2020 | $ 2.1 | $ 4,117.2 | $ 689.1 | $ (16) | $ (1,840.1) | $ 2,952.3 | |
Ending balance (in shares) at Nov. 01, 2020 | 206,228 | (50,630) | 155,598 |
CONSOLIDATED STATEMENTS OF ST_2
CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY ( Parenthetical) (HD Supply Holdings, Inc) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 01, 2020 | Nov. 03, 2019 | Nov. 01, 2020 | Nov. 03, 2019 | |
CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY | ||||
Unrealized gain (loss) on cash flow hedge, tax | $ (12.5) | $ 0.1 | $ (7.5) | $ 7.1 |
CONSOLIDATED STATEMENTS OF OP_3
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (HD Supply, Inc.) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 01, 2020 | Nov. 03, 2019 | Nov. 01, 2020 | Nov. 03, 2019 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME | ||||
Net Sales | $ 827.5 | $ 825.2 | $ 2,269 | $ 2,426 |
Cost of sales | 479.2 | 473.2 | 1,311 | 1,388.4 |
Gross Profit | 348.3 | 352 | 958 | 1,037.6 |
Operating expenses: | ||||
Selling, general, and administrative | 205.7 | 209.3 | 597.6 | 625.9 |
Depreciation and amortization | 17.7 | 15.5 | 52.1 | 45.2 |
Restructuring and separation | 3.9 | 1.3 | 7.6 | (0.4) |
Total operating expenses | 227.3 | 226.1 | 657.3 | 670.7 |
Operating Income | 121 | 125.9 | 300.7 | 366.9 |
Interest expense | 22 | 27.4 | 71.1 | 83.4 |
Loss on extinguishment & modification of debt | 5.5 | 5.5 | ||
Other (income) expense, net | 43.6 | 43.6 | ||
Income from Continuing Operations Before Provision for Income Taxes | 49.9 | 98.5 | 180.5 | 283.5 |
Provision for income taxes | 14.4 | 25.1 | 46.6 | 71.1 |
Income from Continuing Operations | 35.5 | 73.4 | 133.9 | 212.4 |
Income from discontinued operations, net of tax | 1,572.7 | 58.5 | 1,677.3 | 161.3 |
Net Income | 1,608.2 | 131.9 | 1,811.2 | 373.7 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustment | 14.7 | 15 | 0.2 | |
Unrealized gain (loss) on cash flow hedge, net of tax of $(12.5), $0.1, $(7.5), and $7.1 | 35.6 | (0.3) | 21.1 | (20.5) |
Total Comprehensive Income | 1,658.5 | 131.6 | 1,847.3 | 353.4 |
HD Supply, Inc. | ||||
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME | ||||
Net Sales | 827.5 | 825.2 | 2,269 | 2,426 |
Cost of sales | 479.2 | 473.2 | 1,311 | 1,388.4 |
Gross Profit | 348.3 | 352 | 958 | 1,037.6 |
Operating expenses: | ||||
Selling, general, and administrative | 205.7 | 209.3 | 597.6 | 625.9 |
Depreciation and amortization | 17.7 | 15.5 | 52.1 | 45.2 |
Restructuring and separation | 3.9 | 1.3 | 7.6 | (0.4) |
Total operating expenses | 227.3 | 226.1 | 657.3 | 670.7 |
Operating Income | 121 | 125.9 | 300.7 | 366.9 |
Interest expense | 22 | 27.4 | 71.1 | 83.4 |
Loss on extinguishment & modification of debt | 5.5 | 5.5 | ||
Other (income) expense, net | 43.6 | 43.6 | ||
Income from Continuing Operations Before Provision for Income Taxes | 49.9 | 98.5 | 180.5 | 283.5 |
Provision for income taxes | 14.4 | 25.1 | 46.6 | 71.1 |
Income from Continuing Operations | 35.5 | 73.4 | 133.9 | 212.4 |
Income from discontinued operations, net of tax | 1,572.7 | 58.5 | 1,677.3 | 161.3 |
Net Income | 1,608.2 | 131.9 | 1,811.2 | 373.7 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustment | 14.7 | 15 | 0.2 | |
Unrealized gain (loss) on cash flow hedge, net of tax of $(12.5), $0.1, $(7.5), and $7.1 | 35.6 | (0.3) | 21.1 | (20.5) |
Total Comprehensive Income | $ 1,658.5 | $ 131.6 | $ 1,847.3 | $ 353.4 |
CONSOLIDATED STATEMENTS OF OP_4
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Parenthetical) (HD Supply, Inc.) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 01, 2020 | Nov. 03, 2019 | Nov. 01, 2020 | Nov. 03, 2019 | |
Unrealized gain (loss) on cash flow hedge | $ (12.5) | $ 0.1 | $ (7.5) | $ 7.1 |
HD Supply, Inc. | ||||
Unrealized gain (loss) on cash flow hedge | $ (12.5) | $ 0.1 | $ (7.5) | $ 7.1 |
CONSOLIDATED BALANCE SHEETS (_2
CONSOLIDATED BALANCE SHEETS (HD Supply, Inc.) - USD ($) $ in Millions | Nov. 01, 2020 | Feb. 02, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 2,315 | $ 34.4 |
Receivables, less allowance for credit losses of $10.2 and $7.6 | 400.1 | 362.1 |
Inventories | 388.6 | 427.1 |
Current assets of discontinued operations | 748 | |
Other current assets | 73.6 | 91.3 |
Total current assets | 3,177.3 | 1,662.9 |
Property and equipment, net | 260.2 | 271.2 |
Operating lease right of-use assets | 228.7 | 233.2 |
Goodwill | 1,604.5 | 1,604.5 |
Intangible assets, net | 59.8 | 68.4 |
Deferred tax assets | 3.8 | 2.1 |
Non-current assets of discontinued operations | 861.5 | |
Other assets | 9.2 | 11.7 |
Total assets | 5,343.5 | 4,715.5 |
Current liabilities: | ||
Accounts payable | 270 | 218.7 |
Accrued compensation and benefits | 40.8 | 37.9 |
Current installments of long-term debt | 10.7 | 10.7 |
Current lease liabilities | 51 | 50.8 |
Accrued income taxes | 282.3 | |
Current liabilities of discontinued operations | 341.2 | |
Other current liabilities | 201.1 | 154.8 |
Total current liabilities | 855.9 | 814.1 |
Long-term debt, excluding current installments | 1,250.8 | 2,035.4 |
Deferred tax liabilities | 22 | 32.7 |
Long-term lease liabilities | 186.6 | 192.6 |
Non-current liabilities of discontinued operations | 203.8 | |
Other liabilities | 75.9 | 84.7 |
Total liabilities | 2,391.2 | 3,363.3 |
Stockholders' equity: | ||
Common stock, par value $0.01; authorized 1,000 shares; issued and outstanding 1,000 shares at November 1, 2020 and February 2, 2020 | 2.1 | 2 |
Paid-in capital | 4,117.2 | 4,097.4 |
Retained earnings (accumulated deficit) | 689.1 | (1,122.1) |
Accumulated other comprehensive loss | (16) | (52.1) |
Total stockholders' equity | 2,952.3 | 1,352.2 |
Total liabilities and stockholders' equity | 5,343.5 | 4,715.5 |
HD Supply, Inc. | ||
Current assets: | ||
Cash and cash equivalents | 2,314.3 | 34.4 |
Receivables, less allowance for credit losses of $10.2 and $7.6 | 400 | 362 |
Inventories | 388.6 | 427.1 |
Current assets of discontinued operations | 748 | |
Other current assets | 73.6 | 91.3 |
Total current assets | 3,176.5 | 1,662.8 |
Property and equipment, net | 260.2 | 271.2 |
Operating lease right of-use assets | 228.7 | 233.2 |
Goodwill | 1,604.5 | 1,604.5 |
Intangible assets, net | 59.8 | 68.4 |
Deferred tax assets | 3.8 | 2.1 |
Non-current assets of discontinued operations | 861.5 | |
Other assets | 9.2 | 11.7 |
Total assets | 5,342.7 | 4,715.4 |
Current liabilities: | ||
Accounts payable | 270 | 218.7 |
Accrued compensation and benefits | 40.8 | 37.9 |
Current installments of long-term debt | 10.7 | 10.7 |
Current lease liabilities | 51 | 50.8 |
Accrued income taxes | 282.3 | |
Current liabilities of discontinued operations | 341.2 | |
Other current liabilities | 180.7 | 154.8 |
Total current liabilities | 835.5 | 814.1 |
Long-term debt, excluding current installments | 1,250.8 | 2,035.4 |
Deferred tax liabilities | 22 | 32.7 |
Long-term lease liabilities | 186.6 | 192.6 |
Non-current liabilities of discontinued operations | 203.8 | |
Other liabilities | 75.9 | 84.7 |
Total liabilities | 2,370.8 | 3,363.3 |
Stockholders' equity: | ||
Paid-in capital | 2,140.1 | 2,367.6 |
Retained earnings (accumulated deficit) | 847.8 | (963.4) |
Accumulated other comprehensive loss | (16) | (52.1) |
Total stockholders' equity | 2,971.9 | 1,352.1 |
Total liabilities and stockholders' equity | $ 5,342.7 | $ 4,715.4 |
CONSOLIDATED BALANCE SHEETS (_3
CONSOLIDATED BALANCE SHEETS (Parenthetical) (HD Supply, Inc.) - USD ($) $ in Millions | Nov. 01, 2020 | Feb. 02, 2020 |
Receivables | ||
Receivables, allowance for credit losses | $ 10.2 | $ 7.6 |
Common stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 155,600,000 | 161,400,000 |
Common stock, shares outstanding | 155,600,000 | 161,400,000 |
HD Supply, Inc. | ||
Receivables | ||
Receivables, allowance for credit losses | $ 10.2 | $ 7.6 |
Common stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,000 | 1,000 |
Common stock, shares issued | 1,000 | 1,000 |
Common stock, shares outstanding | 1,000 | 1,000 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (HD Supply, Inc.) - USD ($) $ in Millions | 9 Months Ended | |
Nov. 01, 2020 | Nov. 03, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 1,811.2 | $ 373.7 |
Reconciliation of net income to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 78.2 | 82.7 |
Provision for credit losses | 11.8 | 7.4 |
Non-cash interest expense | 4.5 | 4.6 |
Loss on extinguishment & modification of debt | 5.5 | |
Gain on sale of business | (1,762) | |
Stock-based compensation expense | 14.7 | 18.1 |
Deferred income taxes | (27.4) | 101.8 |
Changes in assets and liabilities, net of the effects of acquisitions & dispositions: | ||
(Increase) decrease in receivables | (83.1) | (133.7) |
(Increase) decrease in inventories | 17.3 | (34.3) |
(Increase) decrease in other current assets | 8.2 | (2.5) |
(Increase) decrease in other assets | (2.1) | 0.3 |
Increase (decrease) in accounts payable and accrued liabilities | 425.2 | 75.8 |
Increase (decrease) in other long term liabilities | 21.9 | |
Net cash provided by (used in) operating activities | 523.9 | 496.6 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Capital expenditures | (54.6) | (89.1) |
Proceeds from sales of property and equipment | 0.3 | 2.7 |
Proceeds from sales of businesses, net | 2,845.5 | |
Payments for businesses acquired, net of cash acquired | (9.4) | |
Net cash provided by (used in) investing activities | 2,791.2 | (95.8) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Repayments of long-term debt | (532.3) | (8) |
Repayments of financing liabilities | (87.9) | |
Borrowings on long-term revolver debt | 434.1 | 978 |
Repayments on long-term revolver debt | (693.6) | (964.3) |
Debt issuance and modification costs | (0.1) | |
Other financing activities | (1) | (0.8) |
Net cash provided by (used in) financing activities | (1,034.6) | (402.3) |
Effect of exchange rates on cash and cash equivalents | 0.1 | |
Increase (decrease) in cash and cash equivalents | 2,280.6 | (1.5) |
Cash and cash equivalents at beginning of period | 34.4 | 38 |
Cash and cash equivalents at end of period | 2,315 | 36.5 |
HD Supply, Inc. | ||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | 1,811.2 | 373.7 |
Reconciliation of net income to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 78.2 | 82.7 |
Provision for credit losses | 11.8 | 7.4 |
Non-cash interest expense | 4.5 | 4.6 |
Loss on extinguishment & modification of debt | 5.5 | |
Gain on sale of business | (1,762) | |
Stock-based compensation expense | 14.7 | 18.1 |
Deferred income taxes | (27.4) | 101.8 |
Other | 2.7 | |
Changes in assets and liabilities, net of the effects of acquisitions & dispositions: | ||
(Increase) decrease in receivables | (83.1) | (133.7) |
(Increase) decrease in inventories | 17.3 | (34.3) |
(Increase) decrease in other current assets | 8.1 | (2.3) |
(Increase) decrease in other assets | (2.1) | 0.3 |
Increase (decrease) in accounts payable and accrued liabilities | 425.2 | 75.8 |
Increase (decrease) in other long term liabilities | 21.9 | |
Net cash provided by (used in) operating activities | 523.8 | 496.8 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Capital expenditures | (54.6) | (89.1) |
Proceeds from sales of property and equipment | 0.3 | 2.7 |
Proceeds from sales of businesses, net | 2,845.5 | |
Payments for businesses acquired, net of cash acquired | (9.4) | |
Net cash provided by (used in) investing activities | 2,791.2 | (95.8) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Equity distribution to Parent | (242.4) | (319.2) |
Repayments of long-term debt | (532.3) | (8) |
Repayments of financing liabilities | (87.9) | |
Borrowings on long-term revolver debt | 434.1 | 978 |
Repayments on long-term revolver debt | (693.6) | (964.3) |
Debt issuance and modification costs | (0.1) | |
Other financing activities | (1) | (0.8) |
Net cash provided by (used in) financing activities | (1,035.2) | (402.3) |
Effect of exchange rates on cash and cash equivalents | 0.1 | |
Increase (decrease) in cash and cash equivalents | 2,279.9 | (1.3) |
Cash and cash equivalents at beginning of period | 34.4 | 37.8 |
Cash and cash equivalents at end of period | $ 2,314.3 | $ 36.5 |
CONSOLIDATED STATEMENTS OF ST_3
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY (HD Supply, Inc.) - USD ($) shares in Thousands, $ in Millions | HD Supply, Inc.Common Stock | HD Supply, Inc.Paid-in Capital | HD Supply, Inc.Retained Earnings (Accumulated Deficit)Cumulative effect of accounting change | HD Supply, Inc.Retained Earnings (Accumulated Deficit) | HD Supply, Inc.Accumulated Other Comprehensive Income (Loss) | HD Supply, Inc. | Common Stock | Paid-in Capital | Retained Earnings (Accumulated Deficit)Cumulative effect of accounting change | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Income (Loss) | Total |
Beginning balance at Feb. 03, 2019 | $ 2,726.1 | $ (1,412.8) | $ (30.7) | $ 2 | $ 4,067.2 | $ (1,571.5) | $ (30.7) | |||||
Beginning balance (in shares) at Feb. 03, 2019 | 1 | 204,806 | ||||||||||
Increase (decrease) in stockholders' equity | ||||||||||||
Equity distribution to Parent | (319.2) | |||||||||||
Stock-based compensation | 17.8 | 17.8 | ||||||||||
Other | 0.1 | (0.1) | ||||||||||
Net income | 373.7 | $ 373.7 | 373.7 | $ 373.7 | ||||||||
Unrealized gain (loss) on cash flow hedge, net of tax of $(12.5), $0.1, $(7.5), and $7.1 | (20.5) | (20.5) | (20.5) | (20.5) | ||||||||
Foreign currency translation adjustment | 0.2 | 0.2 | 0.2 | 0.2 | ||||||||
Ending balance at Nov. 03, 2019 | 2,424.8 | $ (2.5) | (1,041.6) | (51) | $ 1,332.2 | $ 2 | 4,091.8 | $ (2.5) | (1,200.4) | (51) | $ 1,328.2 | |
Ending balance (in shares) at Nov. 03, 2019 | 1 | 1 | 205,403 | 162,803 | ||||||||
Beginning balance at Aug. 04, 2019 | 2,662.1 | (1,173.5) | (50.7) | $ 2 | 4,086.1 | (1,332.2) | (50.7) | |||||
Beginning balance (in shares) at Aug. 04, 2019 | 1 | 205,409 | ||||||||||
Increase (decrease) in stockholders' equity | ||||||||||||
Equity distribution to Parent | (243) | |||||||||||
Stock-based compensation | 5.6 | 5.6 | ||||||||||
Other | 0.1 | (0.1) | ||||||||||
Net income | 131.9 | $ 131.9 | 131.9 | $ 131.9 | ||||||||
Unrealized gain (loss) on cash flow hedge, net of tax of $(12.5), $0.1, $(7.5), and $7.1 | (0.3) | (0.3) | (0.3) | (0.3) | ||||||||
Ending balance at Nov. 03, 2019 | 2,424.8 | $ (2.5) | (1,041.6) | (51) | $ 1,332.2 | $ 2 | 4,091.8 | $ (2.5) | (1,200.4) | (51) | $ 1,328.2 | |
Ending balance (in shares) at Nov. 03, 2019 | 1 | 1 | 205,403 | 162,803 | ||||||||
Beginning balance at Feb. 02, 2020 | 2,367.6 | (963.4) | (52.1) | $ 1,352.1 | $ 2 | 4,097.4 | (1,122.1) | (52.1) | $ 1,352.2 | |||
Beginning balance (in shares) at Feb. 02, 2020 | 1 | 205,473 | ||||||||||
Increase (decrease) in stockholders' equity | ||||||||||||
Equity distribution to Parent | (242.4) | |||||||||||
Stock-based compensation | 14.9 | 14.9 | ||||||||||
Other | (0.2) | |||||||||||
Net income | 1,811.2 | 1,811.2 | 1,811.2 | 1,811.2 | ||||||||
Unrealized gain (loss) on cash flow hedge, net of tax of $(12.5), $0.1, $(7.5), and $7.1 | 21.1 | 21.1 | 21.1 | 21.1 | ||||||||
Foreign currency translation adjustment | 15 | 15 | 15 | 15 | ||||||||
Ending balance at Nov. 01, 2020 | 2,140.1 | 847.8 | (16) | $ 2,971.9 | $ 2.1 | 4,117.2 | 689.1 | (16) | $ 2,952.3 | |||
Ending balance (in shares) at Nov. 01, 2020 | 1 | 1 | 206,228 | 155,598 | ||||||||
Beginning balance at Aug. 02, 2020 | 2,376.1 | (760.3) | (66.3) | $ 2.1 | 4,109.9 | (919) | (66.3) | |||||
Beginning balance (in shares) at Aug. 02, 2020 | 1 | 206,179 | ||||||||||
Increase (decrease) in stockholders' equity | ||||||||||||
Equity distribution to Parent | (238.8) | |||||||||||
Stock-based compensation | 2.7 | 2.7 | ||||||||||
Other | 0.1 | (0.1) | (0.2) | (0.1) | ||||||||
Net income | 1,608.2 | $ 1,608.2 | 1,608.2 | $ 1,608.2 | ||||||||
Unrealized gain (loss) on cash flow hedge, net of tax of $(12.5), $0.1, $(7.5), and $7.1 | 35.6 | 35.6 | 35.6 | 35.6 | ||||||||
Foreign currency translation adjustment | 14.7 | 14.7 | 14.7 | 14.7 | ||||||||
Ending balance at Nov. 01, 2020 | $ 2,140.1 | $ 847.8 | $ (16) | $ 2,971.9 | $ 2.1 | $ 4,117.2 | $ 689.1 | $ (16) | $ 2,952.3 | |||
Ending balance (in shares) at Nov. 01, 2020 | 1 | 1 | 206,228 | 155,598 |
CONSOLIDATED STATEMENTS OF ST_4
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY ( Parenthetical) (HD Supply, Inc.) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 01, 2020 | Nov. 03, 2019 | Nov. 01, 2020 | Nov. 03, 2019 | |
Unrealized gain (loss) on cash flow hedge, tax | $ (12.5) | $ 0.1 | $ (7.5) | $ 7.1 |
HD Supply, Inc. | ||||
Unrealized gain (loss) on cash flow hedge, tax | $ (12.5) | $ 0.1 | $ (7.5) | $ 7.1 |
NATURE OF BUSINESS AND BASIS OF
NATURE OF BUSINESS AND BASIS OF PRESENTATION | 9 Months Ended |
Nov. 01, 2020 | |
NATURE OF BUSINESS AND BASIS OF PRESENTATION | |
NATURE OF BUSINESS AND BASIS OF PRESENTATION | NOTE 1 — NATURE OF BUSINESS AND BASIS OF PRESENTATION Nature of Business HD Supply Holdings, Inc. (‘‘Holdings’’) indirectly owns all of the outstanding common stock of HD Supply, Inc. (“HDS”). Holdings, together with its direct and indirect subsidiaries, including HDS (“HD Supply” or the “Company”), is one of the largest industrial distribution companies in North America. The Company specializes in the Maintenance, Repair & Operations market sector. Through approximately 44 distribution centers in the U.S. and Canada, the Company serves this market with an integrated go-to-market strategy. HD Supply has more than 5,500 associates delivering localized, customer-tailored products, services and expertise. The Company serves approximately 300,000 customers, which include contractors, maintenance professionals, industrial businesses, and government entities primarily in multifamily, hospitality, healthcare, and institutional facilities markets. HD Supply’s broad range of end-to-end product lines and services includes approximately 200,000 stock-keeping units of quality, name-brand and proprietary-brand products as well as value-add services. HD Supply reports results of operations as one reportable segment. See “Note 2 — Discontinued Operations” for further information on the sale of the Construction & Industrial business, a previous HD Supply reportable segment. Basis of Presentation In management’s opinion, the unaudited financial information for the interim periods presented includes all adjustments necessary for a fair statement of the results of operations, financial position, and cash flows. All adjustments are of a normal recurring nature unless otherwise disclosed. Revenues, expenses, assets and liabilities can vary during each quarter of the year. Therefore, the results and trends in these interim financial statements may not be the same as those for the full year. For a more complete discussion of the Company’s significant accounting policies and other information, you should read this report in conjunction with the Company’s annual report on Form 10-K for the year ended February 2, 2020, which includes all disclosures required by generally accepted accounting principles in the United States of America (“GAAP”). F iscal Year HD Supply’s fiscal year is a 52 53 Principles of Consolidation The consolidated financial statements of Holdings present the results of operations, financial position and cash flows of Holdings and its wholly-owned subsidiaries, including HDS. The consolidated financial statements of HDS present the results of operations, financial position and cash flows of HDS and its wholly-owned subsidiaries. All material intercompany balances and transactions are eliminated. Results of operations of businesses acquired are included from their respective dates of acquisition. The results of operations of all discontinued operations have been separately reported as discontinued operations for all periods presented. Estimates Management has made a number of estimates and assumptions relating to the reporting of assets and liabilities, the disclosure of contingent assets and liabilities, and reported amounts of revenues and expenses in preparing these consolidated financial statements in conformity with GAAP. Actual results could differ from these estimates. Self-Insurance HD Supply has a high-deductible insurance program for most losses related to general liability, product liability, environmental liability, automobile liability, workers’ compensation, and is self-insured for certain legal claims and medical claims, while maintaining per employee stop-loss coverage. The expected ultimate cost for claims incurred as of the balance sheet date is not discounted and is recognized as a liability. Self-insurance losses for claims filed and claims incurred but not reported are accrued based upon estimates of the aggregate liability for uninsured claims using loss development factors and actuarial assumptions followed in the insurance industry and historical loss development experience. As of November 1, 2020 and February 2, 2020, self-insurance reserves for continuing operations totaled approximately $28.8 million and $27.9 million, respectively. At February 2, 2020, self-insurance reserves classified as discontinued operations totaled approximately $22.0 million. See "Note 2 - Discontinued Operations" for further information on the sale of Construction & Industrial. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 9 Months Ended |
Nov. 01, 2020 | |
DISCONTINUED OPERATIONS | |
DISCONTINUED OPERATIONS | NOTE 2 — DISCONTINUED OPERATIONS On October 19, 2020, the Company completed the sale of its Construction & Industrial business and received cash proceeds of approximately $2.8 billion, net of transaction cost payments of approximately $34.9 million. In the three and nine months ended November 1, 2020, the Company recognized a gain on sale of the Construction & Industrial business of approximately $1.5 billion, net of tax of $257.1 million. The sale is subject to a post-closing working capital adjustment, which the Company expects to settle by early 2021. Summary Financial Information In accordance with Accounting Standards Codification (“ASC”) 205-20, “Discontinued Operations,” as amended, the results of the Construction & Industrial business are classified as discontinued operations. The presentation of discontinued operations includes revenues and expenses of the discontinued operations and gain/loss on the disposition of businesses, net of tax, as one line item on the Consolidated Statements of Operations and Comprehensive Income. All Consolidated Statements of Operations and Comprehensive Income presented have been revised to reflect this presentation. The assets and liabilities of discontinued operations are presented separately within their respective current and non-current sections of the Consolidated Balance Sheets. The Consolidated Balance Sheets as of February 2, 2020 have been revised to reflect this presentation. The following table provides additional detail related to the results of operations of the discontinued operations, primarily the Construction & Industrial business (amounts in millions): Three Months Ended Nine Months Ended November 1, November 3, November 1, November 3, 2020 2019 2020 2019 Net sales $ 687.9 $ 818.0 $ 2,193.9 $ 2,334.5 Cost of sales 441.0 529.5 1,410.9 1,513.7 Gross Profit 246.9 288.5 783.0 820.8 Operating expenses: Selling, general and administrative 153.2 195.3 517.9 566.5 Depreciation and amortization 1.0 11.0 21.6 31.8 Restructuring & separation Charges 8.4 2.1 14.6 2.1 Total operating expenses 162.6 208.4 554.1 600.4 Operating Income 84.3 80.1 228.9 220.4 Gain on disposal of discontinued operations 1,767.0 — 1,762.0 — Income before provision for income taxes 1,851.3 80.1 1,990.9 220.4 Provision for income taxes 278.6 21.6 313.6 59.1 Income from discontinued operations, net of tax $ 1,572.7 $ 58.5 $ 1,677.3 $ 161.3 At November 1, 2020 and February 2, 2020, the carrying amounts of major classes of assets and liabilities of the Construction & Industrial discontinued operations included in the Consolidated Balance Sheets were as follows (amounts in millions): November 1, February 2, 2020 2020 Current assets: Receivables, less allowance for credit losses of $- and $11.7 $ — $ 392.5 Inventories — 344.3 Other current assets — 11.2 Total current assets — 748.0 Property and equipment, net — 119.6 Operating lease right-of-use assets 246.9 Goodwill — 386.1 Intangible assets, net — 106.1 Other non-current assets — 2.8 Total non-current assets — 861.5 Total assets of discontinued operations $ — $ 1,609.5 Current Liabilities: Accounts payable $ — $ 195.2 Accrued compensation and benefits — 33.0 Current lease liabilities — 59.2 Other current liabilities — 53.8 Total current liabilities — 341.2 Long-term lease liabilities — 190.8 Other non-current liabilities — 13.0 Total non-current liabilities — 203.8 Total liabilities of discontinued operations $ — $ 545.0 The following table provides additional detail related to the net cash provided by operating and investing activities of the discontinued operations (amounts in millions): Nine Months Ended November 1, November 3, 2020 2019 Net cash flows provided by operating activities $ 266.5 $ 251.5 Cash flows from investing activities: Capital expenditures (18.7) (35.2) Proceeds from sales of businesses, net 2,845.5 — Payments for businesses acquired, net — 2.8 Proceeds from sales of property and equipment, net 0.3 0.4 Net cash flows provided by investing activities $ 2,827.1 $ (32.0) |
DEBT
DEBT | 9 Months Ended |
Nov. 01, 2020 | |
DEBT | |
DEBT | NOTE 3 — DEBT HDS’s long-term debt as of November 1, 2020 and February 2, 2020 consisted of the following (dollars in millions): November 1, 2020 February 2, 2020 Outstanding Interest Outstanding Interest Principal Rate % (1) Principal Rate % (1) Senior ABL Facility due 2022 $ — — $ 260.3 3.15 Term B-5 Loans due 2023 524.3 1.90 1,056.6 3.40 October 2018 Senior Unsecured Notes due 2026 750.0 5.375 750.0 5.375 Total gross long-term debt $ 1,274.3 $ 2,066.9 Less unamortized discount (1.2) (3.0) Less unamortized deferred financing costs (11.6) (17.8) Total net long-term debt $ 1,261.5 $ 2,046.1 Less current installments (10.7) (10.7) Total net long-term debt, excluding current installments $ 1,250.8 $ 2,035.4 (1) Represents the stated rate of interest, without including the effect of discounts, premiums, or interest rate swap agreements. Debt Transactions On October 20, 2020, HDS reduced its U.S. and Canadian borrowing capacities under its Senior ABL Facility (as defined below) by $340.0 million and $60.0 million, respectively. The total borrowing capacity under the Senior ABL Facility is now $600.0 million (subject to availability under a borrowing base). As a result, the Company incurred a $0.8 million loss on extinguishment of debt for the write-off of unamortized deferred financing costs, in accordance with ASC 470-50, “Debt – Modifications and Extinguishments.” On October 20, 2020, HDS used a portion of the net proceeds from the sale of the Construction & Industrial business (see “Note 2 - Discontinued Operations”) to repay $524.3 million aggregate principal of its Term B-5 Loans, as defined below. As a result, the Company incurred a $4.7 million loss on extinguishment of debt, which includes write-offs of $1.2 million and $3.5 million of unamortized original issue discount and unamortized deferred financing costs, respectively, in accordance with ASC 470-50, “Debt – Modifications and Extinguishments.” Senior Credit Facilities Senior ABL Facility The Senior Asset Based Lending Facility due 2022 (the “Senior ABL Facility”) provides for senior secured revolving loans and letters of credit of up to a maximum aggregate principal amount of $600.0 million (subject to availability under a borrowing base). Extensions of credit under the Senior ABL Facility are limited by a borrowing base calculated periodically based on specified percentages of the value of eligible inventory and eligible accounts receivable, subject to certain reserves and other adjustments. A portion of the Senior ABL Facility is available for letters of credit and swingline loans. As of November 1, 2020, HDS had $576.1 million of Excess Availability (as defined in the Senior ABL Facility agreement) under the Senior ABL Facility (after giving effect to the borrowing base limitations and approximately $23.8 million in letters of credit issued and including $139.4 million of borrowings available on qualifying cash balances). At HDS’s option, the interest rates applicable to the loans under the Senior ABL Facility are based (i) in the case of U.S. dollar-denominated loans, either at Eurocurrency Base Rate plus an applicable margin, or Prime Rate (as defined in the Senior ABL Facility agreement) plus an applicable margin and (ii) in the case of Canadian dollar-denominated loans, either the Bankers’ Acceptance rate plus an applicable margin, or the Canadian Prime Rate (as defined in the Senior ABL Facility agreement) plus an applicable margin. The margins applicable for each elected interest rate are subject to a pricing grid, as defined in the agreement governing the Senior ABL Facility, based on average Excess Availability for the previous fiscal quarter. The Senior ABL Facility also contains a letter of credit fee computed at a rate per annum equal to the Applicable Margin (as defined in the Senior ABL Facility agreement) then in effect for Eurocurrency Loans and an unused commitment fee subject to a pricing grid, included in the agreement governing the Senior ABL Facility, based on Excess Availability. The Senior ABL Facility also permits HDS to add one or more incremental term loan facilities to be included in the Senior ABL Facility or one or more revolving credit facility commitments to be included in the Senior ABL Facility. Senior Term Loan Facility HDS’s Senior Term Facility (the “Senior Term Facility”) consists of a senior secured term loan facility (the ‘‘Term Loan Facility,’’ and the term loans thereunder, the ‘‘Term Loans’’) providing for Term Loans in an original aggregate principal amount of $1,070.0 million (the “Term B-5 Loans”). As of November 1, 2020, $524.3 million of the Term B-5 Loans principal remains outstanding. The Term B-5 Loans will mature on October 17, 2023 and amortize in equal quarterly installments in aggregate annual amounts equal to 1.00% of the original principal amount of the Term Loans with the balance payable at the maturity date. The Term B-5 Loans bear interest at the applicable margin for borrowings of 1.75% for Eurocurrency Loan borrowings and 0.75% for base rate borrowings. For additional information on HDS’s Senior ABL Facility or Senior Term Facility (collectively, the “Senior Credit Facilities”), including guarantees and security, please refer to the Notes to Consolidated Financial Statements of our annual report on Form 10-K for the fiscal year ended February 2, 2020. Unsecured Notes 5.375% Senior Unsecured Notes due 2026 HDS issued $750.0 million aggregate principal amount of 5.375% Senior Unsecured Notes due 2026 (the “October 2018 Senior Unsecured Notes”) under an Indenture, dated as of October 11, 2018 (the “October 2018 Senior Unsecured Notes Indenture”) among HDS, certain subsidiaries of HDS as guarantors (the “Subsidiary Guarantors”) and the Trustee. The October 2018 Senior Unsecured Notes bear interest at a rate of 5.375% per annum and will mature on October 15, 2026. Interest is paid semi-annually on April 15 th th The October 2018 Senior Unsecured Notes are unsecured senior indebtedness of HDS and rank equal in right of payment with all of HDS’s existing and future senior indebtedness, senior in right of payment to all of HDS’s existing and future subordinated indebtedness, and effectively subordinated to all of HDS’s existing and future secured indebtedness, including, without limitation, indebtedness under the Senior Credit Facilities, to the extent of the value of the collateral securing each indebtedness. The October 2018 Senior Unsecured Notes are guaranteed, on a senior unsecured basis, by each of HDS’s direct and indirect existing and future subsidiaries that is a wholly owned domestic subsidiary (other than certain excluded subsidiaries), and by each other domestic subsidiary that is a borrower under the Senior ABL Facility or that guarantees HDS’s obligations under any credit facility or capital market securities. These guarantees are subject to release under customary circumstances as stipulated in the October 2018 Senior Unsecured Notes Indenture. The October 2018 Senior Unsecured Notes and related guarantees have not been, and are not required to be, registered under the Securities Act of 1933, as amended, or the securities laws of any other jurisdiction. Redemption HDS may redeem the October 2018 Senior Unsecured Notes, in whole or in part, at any time (1) prior to October 15, 2021, at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date, plus the applicable make-whole premium set forth in the October 2018 Senior Unsecured Notes Indenture and (2) on and after October 15, 2021, at the applicable redemption price set forth below (expressed as a percentage of principal amount), plus accrued and unpaid interest, if any, to the relevant redemption date, if redeemed during the 12-month period commencing on October 15 of the year set forth below. Year Percentage 2021 102.688 % 2022 101.344 % 2023 and thereafter 100.000 % In addition, at any time prior to October 15, 2021, HDS may redeem on one or more occasions up to 40% of the aggregate principal amount of the October 2018 Senior Unsecured Notes with the proceeds of certain equity offerings at a redemption price of 105.375% of the principal amount in respect of the October 2018 Senior Unsecured Notes being redeemed, plus accrued and unpaid interest to the redemption date, provided, however, that if the October 2018 Senior Unsecured Notes are redeemed, an aggregate principal amount of the October 2018 Senior Unsecured Notes equal to at least 50% of the original aggregate principal amount of October 2018 Senior Unsecured Notes must remain outstanding immediately after each such redemption of October 2018 Senior Unsecured Notes. Debt covenants HDS’s outstanding debt agreements contain various restrictive covenants including, but not limited to, limitations on the incurrence of additional indebtedness and dividend payments and restrictions on the use of proceeds from asset dispositions. As of November 1, 2020, HDS was in compliance with all such covenants that were in effect on such date. Furthermore, while these restrictions may, at times, limit the amount of dividends, distributions or intercompany transfers that HDS or a particular subsidiary guarantor may pay or make, as applicable, the Company believes that, as of November 1, 2020, it had no such limitations. |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 9 Months Ended |
Nov. 01, 2020 | |
DERIVATIVE INSTRUMENTS | |
DERIVATIVE INSTRUMENTS | NOTE 4 — DERIVATIVE INSTRUMENTS Hedge Strategy and Accounting Policy The Company enters into derivative financial instruments for hedging purposes. In hedging the exposure to variable cash flows on forecasted transactions, deferral accounting is applied when the derivative reduces the risk of the underlying hedged item effectively as a result of high inverse correlation with the value of the underlying exposure. If a derivative instrument either initially fails or later ceases to meet the criteria for deferral accounting, any subsequent gains or losses are recognized currently in income. Cash flows resulting from derivative financial instruments are classified in the same category as the cash flows from the items being hedged. Cash Flow Hedge On October 24, 2018, the Company entered into an interest rate swap agreement with a notional amount of $750.0 million, designated as a cash flow hedge in accordance with ASC 815, “Derivatives and Hedging,” to hedge the variability of cash flows in interest payments associated with the Company’s variable-rate debt. On October 20, 2020, the Company initiated a voluntary partial termination for $500.0 million of the notional amount of the interest rate swap agreement. The Company paid $44.4 million to the counterparty to settle the liability and accrued interest as of the termination date. The Company recognized a $43.6 million loss on the termination, which is included in Other (income) expense, net in the Consolidated Statement of Operations and Comprehensive Income for the three and nine months ended November 1, 2020. The interest rate swap agreement has a remaining notional amount of $250.0 million and swaps a London Interbank Offered Rate (“LIBOR”) rate for a fixed rate of 3.07% and matures on October 17, 2023. The swap effectively converts a portion of the Company’s Term B-5 Loans from a rate of LIBOR plus 1.75% to a 4.82% fixed rate. As of November 1, 2020 and February 2, 2020, the fair value of the Company’s interest rate swap was a liability of $21.2 million and $49.8 million, respectively, which was reflected as $7.4 million and $11.6 million in Other current liabilities and $13.8 million and $38.2 million in Other liabilities, respectively, in the Consolidated Balance Sheets. The Company utilized Level 2 inputs, as defined in the fair value hierarchy in "Note 5 - Fair Value Measurements.” Changes in the fair value of interest rate swap agreements designated as cash flow hedges are recorded as a component of Accumulated Other Comprehensive Income (Loss) (“AOCI”) within Stockholders’ Equity in the Consolidated Balance Sheets and are reclassified into earnings in the same period or periods during which the hedged transactions affect earnings. See “Note 7 - Accumulated Other Comprehensive Income (Loss),” for further information. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Nov. 01, 2020 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | NOTE 5 — FAIR VALUE MEASUREMENTS The fair value measurements and disclosure principles of GAAP (ASC 820, “Fair Value Measurements and Disclosures”) define fair value, establish a framework for measuring fair value and provide disclosure requirements about fair value measurements. These principles define a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1 — Quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 — Quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs (other than quoted prices) that are observable for the asset or liability, either directly or indirectly; Level 3 — Unobservable inputs in which little or no market activity exists. The Company’s financial instruments that are not reflected at fair value on the Consolidated Balance Sheets were as follows as of November 1, 2020 and February 2, 2020 (amounts in millions): As of November 1,2020 As of February 2, 2020 Recorded Estimated Recorded Estimated Amount (1) Fair Value Amount (1) Fair Value Senior ABL Facility $ — $ — $ 260.3 $ 260.0 Term Loans and Notes 1,274.3 1,308.2 1,806.6 1,862.0 Total $ 1,274.3 $ 1,308.2 $ 2,066.9 $ 2,122.0 (1) These amounts do not include accrued interest; accrued interest is classified as Other current liabilities in the accompanying Consolidated Balance Sheets. These amounts do not include any related discounts, premiums, or deferred financing costs. The Company utilized Level 2 inputs, as defined in the fair value hierarchy, to measure the fair value of the long-term debt. Management’s fair value estimates were based on quoted prices for recent trades of HDS’s long-term debt, recent similar credit facilities initiated by companies with like credit quality in similar industries, quoted prices for similar instruments, and inquiries with certain investment communities. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Nov. 01, 2020 | |
INCOME TAXES | |
INCOME TAXES | NOTE 6 — INCOME TAXES For the nine months ended November 1, 2020 and November 3, 2019, the Company’s combined federal, state, and foreign effective tax rate for continuing operations was 25.8% and 25.1%, respectively. The Company’s effective tax rate will vary based on a variety of factors, including overall profitability, the geographical mix of income before taxes and the related tax rates in the jurisdictions where it operates, restructuring and other one-time charges, as well as discrete events, such as audit settlements. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was signed into law. The CARES Act contains significant business tax provisions, including modifications to the rules limiting the deductibility of net operating losses (“NOLs”), expensing of qualified improvement property and business interest in Internal Revenue Code Sections 172(a) and 163(j), respectively. The effects of the new legislation were recognized upon enactment. The Company did not recognize any significant impact to income tax expense for the nine months ended November 1, 2020 related to the CARES Act. As of November 1, 2020 and February 2, 2020, the Company’s unrecognized tax benefits in accordance with the income taxes principles of GAAP (ASC 740, “Income Taxes”) was $17.1 million. The Company’s ending net accrual for interest and penalties related to unrecognized tax benefits as of November 1, 2020 and February 2, 2020 was zero. As of November 1, 2020 and February 2, 2020, the Company’s valuation allowance on its U.S. deferred tax assets was approximately $5.4 million, and $6.0 million, respectively. Each reporting period, the Company assesses available positive and negative evidence and estimates if sufficient future taxable income will be generated to utilize the existing deferred tax assets. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 9 Months Ended |
Nov. 01, 2020 | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | NOTE 7 — ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) AOCI consists of accumulated net unrealized gains or losses associated with foreign currency translation adjustments and the changes in the fair value of derivatives designated as cash flow hedges. The balances and changes in AOCI, net of tax by component for the three and nine months ended November 1, 2020 and November 3, 2019 was as follows (amounts in millions): Three Months Ended Nine Months Ended November 1, November 3, November 1, November 3, 2020 2019 2020 2019 Foreign currency translation adjustment: Beginning balance $ (14.9) $ (15.3) $ (15.2) $ (15.4) Other comprehensive income (loss) before reclassifications (0.8) — (0.5) 0.1 Amounts reclassified from AOCI into earnings (1) 15.5 — 15.5 — Ending balance $ (0.2) $ (15.3) $ (0.2) $ (15.3) Cash flow hedge, net of tax: Beginning balance $ (51.4) $ (35.4) $ (36.9) $ (15.3) Other comprehensive income (loss) before reclassifications (13.0) (2.1) (36.0) (24.6) Amounts reclassified from AOCI into earnings (2) 48.6 1.8 57.1 4.1 Other — — — 0.1 Ending balance, net of tax of $5.4, $12.3, $5.4, and $12.3 $ (15.8) $ (35.7) $ (15.8) $ (35.7) Total ending balance of AOCI $ (16.0) $ (51.0) $ (16.0) $ (51.0) (1) Comprised of unrealized loss reclassified into Income from discontinued operations, net of tax, for the sale of the Construction & Industrial business. (2) Comprised of unrealized loss reclassified into Interest expense in all periods. The three and nine months ended November 1, 2020 also include $43.6 million recognized loss on the termination of $500.0 million notional value of the interest rate swap reclassified into Other (income) expense, net. For further information, see "Note 4 - Derivative Instruments." |
BASIC AND DILUTED WEIGHTED-AVER
BASIC AND DILUTED WEIGHTED-AVERAGE COMMON SHARES | 9 Months Ended |
Nov. 01, 2020 | |
BASIC AND DILUTED WEIGHTED-AVERAGE COMMON SHARES | |
BASIC AND DILUTED WEIGHTED-AVERAGE COMMON SHARES | NOTE 8— BASIC AND DILUTED WEIGHTED-AVERAGE COMMON SHARES The following basic and diluted weighted-average common shares information is provided for Holdings. The reconciliation of basic to diluted weighted-average common shares for the three and nine months ended November 1, 2020 and November 3, 2019 was as follows (in thousands): Three Months Ended Nine Months Ended November 1, 2020 November 3, 2019 November 1, 2020 November 3, 2019 Weighted-average common shares 159,057 164,638 160,271 168,062 Effect of potentially dilutive stock plan securities 747 504 482 583 Diluted weighted-average common shares 159,804 165,142 160,753 168,645 Stock plan securities excluded from dilution (1) 2,431 2,025 3,528 2,741 (1) Represents securities not included in the computation of diluted earnings per share because their effect would have been anti-dilutive. Stock plan securities consist of securities (stock options, restricted stock, restricted stock units, and performance share units) granted under Holdings’ stock-based compensation plans. |
SUPPLEMENTAL BALANCE SHEET AND
SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION | 9 Months Ended |
Nov. 01, 2020 | |
SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION | |
SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION | NOTE 9 — SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION Receivables Receivables as of November 1, 2020 and February 2, 2020 consisted of the following (amounts in millions): HD Supply Holdings, Inc. HD Supply, Inc. November 1, 2020 February 2, 2020 November 1, 2020 February 2, 2020 Trade receivables, net of allowance for credit losses $ 356.9 $ 324.9 $ 356.9 $ 324.9 Vendor rebate receivables 26.2 23.8 26.2 23.8 Other receivables 17.0 13.4 16.9 13.3 Total receivables, net $ 400.1 $ 362.1 $ 400.0 $ 362.0 Trade receivables arise primarily from sales on credit to customers. The Company establishes an allowance for credit losses to present the net amount of trade receivables expected to be collected. The allowance is determined using an estimation of loss rates based upon historical experience adjusted for factors that are relevant to determine the expected collectability of trade receivables. Some of these factors include macroeconomic conditions that correlate with historical loss experience, delinquency trends, aging behavior of trade receivables, and credit and liquidity quality indicators for certain industry groups, customer classes, or individual customers. Other Current Liabilities Other current liabilities as of November 1, 2020 and February 2, 2020 consisted of the following (amounts in millions): HD Supply Holdings, Inc. HD Supply, Inc. November 1, February 2, November 1, February 2, 2020 2020 2020 2020 Accrued legal $ 53.7 50.6 $ 53.7 50.6 Unsettled share repurchases 20.4 — — — Accrued non-income taxes 19.7 14.7 19.7 14.7 Accrued interest 2.3 13.2 2.3 13.2 Other 105.0 76.3 105.0 76.3 Total other current liabilities $ 201.1 $ 154.8 $ 180.7 $ 154.8 As of November 1, 2020 and February 2, 2020, $50.0 million of the legal accrual in Other current liabilities is offset by $50.0 million in insurance recoveries included in Other current assets related to the shareholder class action lawsuit settlement. As of November 1, 2020, $1.9 million of the legal accrual in Other current liabilities is offset by $1.9 million in insurance recoveries included in Other current assets related to the derivative shareholder complaints settlement. For further information, see “Note 11 - Commitments and Contingencies.” Supplemental Cash Flow Information Cash paid for interest in the nine months ended November 1, 2020 and November 3, 2019 was $77.5 million and $89.2 million, respectively. Cash paid for income taxes, net of refunds, in the nine months ended November 1, 2020 and November 3, 2019 was approximately $83.5 million and $35.3 million, respectively. During the nine months ended November 1, 2020 and November 3, 2019, HDS executed equity cash distributions of $242.4 million and $319.2 million, respectively, to Holdings, via HDS’s direct parent, HDS Holding Corporation. The equity distribution from HDS and return of capital recognized by Holdings were eliminated in consolidation of Holdings and its wholly-owned subsidiaries, including HDS. FICA Payment Deferral The CARES Act allows employers to defer the payment of the employer share of Federal Insurance Contributions Act (“FICA”) taxes for the period from March 27, 2020 and ending December 31, 2020. The deferred amount will be payable as follows: ● 50% of the deferred amount will be due December 31, 2021 ● Remaining 50% of the deferred amount will be due December 31, 2022 In the nine months ended November 1, 2020, the Company deferred FICA payments of $21.7 million under the CARES Act. The deferred payments are reflected in Other liabilities in the Consolidated Balance Sheets. The deferral had no impact on the Consolidated Statement of Operations and Comprehensive Income. Share Repurchases During fiscal 2014, Holdings’ Board of Directors authorized a share repurchase program to be funded from cash proceeds received from exercises of employee stock options (“April 2014 Plan”). This share repurchase program does not obligate Holdings to acquire any particular amount of common stock, and it may be terminated at any time at Holdings’ discretion. During November 2018, March September November March Holdings’ share repurchases under these plans for the nine months ended November 1, 2020 and November 3, 2019 were as follows (dollars in millions): Nine Months Ended November 1, 2020 November 3, 2019 Number Cost of Number Cost of September 2020 Plan — $ — — $ — March 2020 Plan 6,321,661 258.3 — — November 2018 Plan — — 8,161,079 316.0 April 2014 Plan 241,474 9.0 158,734 6.8 Total share repurchases 6,563,135 $ 267.3 8,319,813 $ 322.8 |
RESTRUCTURING AND SEPARATION AC
RESTRUCTURING AND SEPARATION ACTIVITIES | 9 Months Ended |
Nov. 01, 2020 | |
RESTRUCTURING AND SEPARATION ACTIVITIES | |
RESTRUCTURING AND SEPARATION ACTIVITIES | NOTE 10 — RESTRUCTURING AND SEPARATION ACTIVITIES On September 24, 2019, the Company announced its intention to separate its Facilities Maintenance and Construction & Industrial businesses into two independent publicly traded companies. On October 19, 2020, the Company completed the sale of it Construction & Industrial business, rather than separate it through a tax-free distribution to shareholders. See "Note 2 - Discontinued Operations" for further discussion. During the three and nine months ended November 1, 2020, the Company recognized $3.9 million and $7.6 million, respectively, in restructuring and separation charges. The charges were for costs related to deferring certain projects during the separation preparations and employee-related costs, including severance and transaction bonuses. As of November 1, 2020, remaining unpaid costs associated with these activities are immaterial. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Nov. 01, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 11 — COMMITMENTS AND CONTINGENCIES Legal Matters On July 10, 2017 and August 8, 2017, stockholders filed putative class action complaints in the U.S. District Court for the Northern District of Georgia, alleging that HD Supply and certain senior members of its management (collectively, the “securities litigation defendants”) made certain false or misleading public statements in violation of the federal securities laws between November 9, 2016 and June 5, 2017, inclusive (the “original securities complaints”). Subsequently, the two securities cases were consolidated, and, on November 16, 2017, the lead plaintiffs appointed by the Court filed a Consolidated Amended Class Action Complaint (the “Amended Complaint”) against the securities litigation defendants on behalf of all persons other than the securities litigation defendants who purchased or otherwise acquired the Company’s common stock between November 9, 2016 and June 5, 2017, inclusive. The Amended Complaint alleges that the securities litigation defendants made certain false or misleading public statements, primarily relating to the Company’s progress in addressing certain supply chain disruption issues encountered in the Company’s Facilities Maintenance business unit. The Amended Complaint asserts claims against the securities litigation defendants under Sections 10(b) and 20(a) of the Exchange Act and SEC Rule 10b-5, and seeks class certification under the Federal Rules of Civil Procedure, as well as unspecified monetary damages, pre-judgment and post-judgment interest, and attorneys’ fees and other costs. On September 19, 2018, the Court granted in part and denied in part the securities litigation defendants’ motion to dismiss. On January 30, 2020, the parties executed a written stipulation and agreement to settle the litigation for a payment of $50 million, subject to court approval. On July 21, 2020, the Court approved the settlement on a final basis. The settlement is without any admission of the allegations in the complaints, and the full settlement amount is covered under the Company’s insurance policies. On August 8, 2017, two stockholder derivative complaints were filed in the U.S. District Court for the Northern District of Georgia (the "federal court derivative action"), naming the Company as a “nominal defendant” and certain members of its senior management and Board of Directors as individual defendants. The complaints generally allege that the individual defendants caused the Company to issue false and misleading statements concerning the Company’s business, operations, and financial prospects, including misrepresentations regarding operating leverage and supply chain corrective actions. The complaints assert claims against the individual defendants under Section 14(a) of the Exchange Act, and allege breaches of fiduciary duties, unjust enrichment, corporate waste, and insider selling. The complaints assert a claim to recover any damages sustained by the Company as a result of the individual defendants’ allegedly wrongful actions, seek certain actions by the Company to modify its corporate governance and internal procedures, and seek to recover attorneys’ fees and other costs. On August 29, 2018, a stockholder derivative complaint was filed in Delaware Chancery Court naming the Company as a “nominal defendant” and certain members of its senior management and Board of Directors as individual defendants (the “Delaware court derivative action”). The complaint generally alleges that the individual defendants caused the Company to issue false and misleading statements concerning the Company’s business, operations, and financial prospects, including misrepresentations regarding supply chain corrective actions. The complaint asserts various common law breach of fiduciary duty claims against the individual defendants and claims of unjust enrichment and insider selling. The complaint seeks to recover any damages sustained by the Company as a result of the individual defendants’ allegedly wrongful actions, seeks certain actions by the Company to modify its corporate governance and internal procedures, and seeks to recover attorneys’ fees and other costs. The individual defendants moved to dismiss the complaint on November 2, 2018. On December 4, 2020, the parties entered into a definitive written agreement to settle the Delaware court derivative action and the federal court derivative action (each as described above) subject to court approval. Under the terms of the agreement, the Company will adopt or continue for a period of time certain corporate governance enhancements and will, if approved by the court, pay or cause to be paid a reasonable attorneys' fee of up to $1.9 million, which amount is covered under the Company's insurance policies. The Company and the individual defendants continue to dispute the allegations in the derivative complaint, and the settlement is without any admission of the allegations in the complaints. In March 2019, the Company received a subpoena from the U.S. Securities and Exchange Commission (the “Commission”) requesting information and documents from calendar years 2016 and 2017 relating to, among other things, the Company’s Facilities Maintenance business unit and the allegations of the Amended Complaint described above. On June 24, 2020, the Company received a letter from the staff of the Atlanta Regional office (the "Staff") of the Commission confirming that the Staff has completed its investigation of HD Supply Holdings, Inc. and, based upon the information the Staff has currently, does not intend to recommend to the Commission that an enforcement action be brought against the Company. HD Supply is involved in various legal proceedings arising in the normal course of its business. The Company establishes reserves for litigation and similar matters when those matters present loss contingencies that it determines to be both probable and reasonably estimable in accordance with ASC 450, “Contingencies.” In the opinion of management, based on current knowledge, all reasonably estimable and probable matters are believed to be adequately reserved for or covered by insurance and are not expected to have a material adverse effect on the Company’s consolidated financial condition, results of operations or cash flows. For all other matters management believes the possibility of losses from such matters is not probable, the potential loss from such matters is not reasonably estimable, or such matters are of such kind or involve such amounts that would not have a material adverse effect on the consolidated financial position, results of operations or cash flows of the Company if disposed of unfavorably. For material matters with loss contingencies that are reasonably possible and reasonably estimable, including matters with loss contingencies that are probable and estimable but for which the amount that is reasonably possible is in excess of the amount that the Company has accrued for, management has estimated the aggregate range of potential loss as $0 to $10 million. If a material loss is probable or reasonably possible, and in either case estimable, the Company has considered it in the analysis and it is included in the discussion set forth above. |
REVENUE
REVENUE | 9 Months Ended |
Nov. 01, 2020 | |
REVENUE | |
REVENUE | NOTE 12 — REVENUE The Company’s revenues are earned from contracts with customers. Contracts include written agreements, as well as arrangements that are implied by customary practices or law. Nature of Products and Services The Company offers products that serve the maintenance, repair and operations (“MRO”) end market as well as value-added services. For additional information regarding the nature of products and services offered, see “Description of business” within Item 2 of this quarterly report on Form 10-Q. Revenue Recognition The Company recognizes revenue, net of allowances for returns and discounts and any taxes collected from the customer, when an identified performance obligation is satisfied by the transfer of control of promised products or services to the customer. The Company ships products to customers by internal fleet and third-party carriers. Transfer of control to the customer for products generally occurs at the point of destination (i.e., upon transfer of title and risk of loss of product). Transfer of control to the customer for services occurs when the customer has the right to direct the use of and obtain substantially all the remaining benefits of the asset that is created or enhanced from the service. The Company accounts for shipping and handling costs associated with outbound freight as a fulfillment cost. Such costs are included in Selling, general, and administrative expenses. Disaggregation of Revenue The Company elected to disaggregate revenue by its demand types: MRO and Property Improvement. The Company believes this disaggregation appropriately meets the objective to depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. The table below represents disaggregated revenue for the Company (amounts in millions): Three Months Ended Nine Months Ended November 1, 2020 November 3, 2019 November 1, 2020 November 3, 2019 Maintenance, Repair, and Operations $ 742.7 $ 725.9 $ 2,040.1 $ 2,149.2 Property Improvement 84.8 99.3 228.9 276.8 Total Net Sales $ 827.5 $ 825.2 $ 2,269.0 $ 2,426.0 |
RECENT ACCOUNTING PRONOUNCEMENT
RECENT ACCOUNTING PRONOUNCEMENTS | 9 Months Ended |
Nov. 01, 2020 | |
RECENT ACCOUNTING PRONOUNCEMENTS | |
RECENT ACCOUNTING PRONOUNCEMENTS | NOTE 13— RECENT ACCOUNTING PRONOUNCEMENTS Recently Adopted Accounting Pronouncements Cloud Computing Arrangements – In August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2018-15, “Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract (a consensus of the FASB Emerging Issues Task Force)” (“ASU 2018-15”). The new guidance aligns the requirements for capitalizing implementation costs in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The update also provides for additional disclosure requirements regarding the nature of an entity’s hosting arrangements that are service contracts. The ASU is effective for annual and interim periods beginning after December 15, 2019. The Company adopted the guidance in ASU 2018-15 on February 3, 2020 (the first day of fiscal 2020) prospectively to capitalize all implementation costs incurred after the date of adoption with no material impact to the Company's financial position, results of operations or cash flows. Financial Instruments Recently Issued Accounting Pronouncements Not Yet Adopted or Applied Income Taxes Reference Rate |
SUBSEQUENT EVENT
SUBSEQUENT EVENT | 9 Months Ended |
Nov. 01, 2020 | |
SUBSEQUENT EVENT | |
SUBSEQUENT EVENT | NOTE 14 – SUBSEQUENT EVENT On November 15, 2020, Holdings entered into an Agreement and Plan of Merger (the “Merger Agreement”) with The Home Depot, Inc., a Delaware corporation (“Parent”), and Coronado Acquisition Sub Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”). Pursuant to the terms of the Merger Agreement, Parent has agreed to cause Merger Sub to commence a tender offer (as it may be extended, amended or supplemented from time to time, the “Offer”) to purchase any and all of the outstanding shares of common stock, par value $0.01 per share, of the Company (the “Shares”), at a price of $56.00 per Share (the “Offer Price”), net to the holder thereof, in cash, without interest thereon. Following the consummation of the Offer, Merger Sub will merge with and into the Company (the “Merger”) in accordance with the Merger Agreement and Section 251(h) of the General Corporation Law of the State of Delaware (the “DGCL”), and the Company will survive the Merger as a wholly owned subsidiary of Parent. At the effective time of the Merger (the “Effective Time”), each Share that is not tendered and accepted pursuant to the Offer (other than Shares owned by Parent, Merger Sub or the Company, or by any of their respective direct or indirect wholly owned subsidiaries, and Shares held by stockholders of the Company who are entitled to demand and who have properly and validly demanded their statutory rights of appraisal in compliance with Section 262 of the DGCL) will be automatically converted into the right to receive the Offer Price, net to the holder thereof, in cash, without interest thereon. The Board of Directors of the Company has approved the Merger Agreement and determined that the Offer, the Merger and the other transactions contemplated by the Merger Agreement are advisable and fair to the stockholders of the Company and in the best interests of the Company, and recommends that the stockholders of the Company accept the Offer and tender their Shares to Merger Sub pursuant to the Offer. The obligation of Merger Sub to purchase Shares tendered in the Offer is subject to customary closing conditions, including, among other things, (i) that at the expiration of the Offer a simple majority of all of the outstanding Shares (determined on a fully diluted basis, which assumes conversion or exercise of all derivative securities regardless of the conversion or exercise price, the vesting schedule or other terms and conditions thereof) be validly tendered and not withdrawn in accordance with the terms of the Offer (the “Minimum Condition”) and (ii) the expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”). The Offer is not subject to any financing condition. The Merger Agreement includes representations, warranties and covenants of the parties customary for a transaction of this nature. Among them, the Company has agreed to conduct its operations in the ordinary course during the period between the execution of the Merger Agreement and the Effective Time. Pursuant to the “no-shop” provisions in the Merger Agreement, the Company will become subject to customary “no-shop” restrictions on its and its representatives’ ability to solicit, discuss or negotiate alternative acquisition proposals from third parties, subject to exceptions for acquisition proposals that the Board of Directors determines in good faith constitutes or could reasonably be expected to result in a “Superior Proposal” (as defined in the Merger Agreement) (the “No-Shop Provisions”). The Merger Agreement also includes customary termination rights for both the Company and Parent, including, among others, the right to terminate in the event the closing of the Offer has not occurred on or before August 15, 2021 (the “Outside Date”), provided that the Outside Date will be automatically extended to November 15, 2021 if the closing conditions regarding the HSR Act have not been met as of August 15, 2021. In addition, the Company has agreed to pay Parent a termination fee of $275 million in cash upon termination of the Merger Agreement under certain specified circumstances, including, among others, (i) in order for the Company to enter into an alternative transaction for a Superior Proposal, (ii) a change in the Board of Directors’ recommendation that the Company’s stockholders tender their Shares in the Offer or (iii) a material and deliberate breach by the Company of the No-Shop Provisions. Under the terms of the Merger Agreement, immediately prior to the Effective Time, each then-outstanding Company equity or equity-based award will be automatically converted into the right to receive the Offer Price (less the applicable exercise price per Share with respect to Company stock options), without any interest thereon and less any required withholding taxes. Four lawsuits had been filed by December 3, 2020 relating to the Offer and the Merger in federal and state courts by purported individual or trust shareholders against the Company, its directors and, in one case, Home Depot. The cases are, in the order by which they were filed: Stein v. HD Supply Holdings, Inc., et al., 1:20-cv-01605 (D. Del. Nov. 25, 2020); Vandunk v. HD Supply Holdings, Inc., et al., 1:20-cv-05777 (E.D.N.Y. Nov. 30, 2020); Drulias v. DeAngelo, et al., Index No. 656625/2020 (N.Y. Cty. Sup. Ct. Nov. 30, 2020); and Rosenfeld Family Found. v. HD Supply Holdings, Inc., et al., 1:20-cv-04854 (N.D. Ga. Dec. 1, 2020). The complaints generally allege that the Schedule 14D-9, and, in one case, the Schedule TO, misrepresent and/or omit certain purportedly material information and assert violations of Sections 14(e) and 14(d) of the Securities Exchange Act of 1934, rules thereunder or common law fraud and/or negligent misrepresentation or concealment. The alleged material misstatements and omissions relate to, among other topics, the Company’s forecasts, Goldman Sachs’ financial analysis, the interests of directors and officers in the Offer and the Merger and events giving rise to the Offer and the Merger. The plaintiffs in each of the foregoing actions seek, among other things, an injunction against the consummation of the Offer and the Merger or, in the alternative, rescission damages, as well as an award of costs and expenses (including attorneys’ and experts’ fees and expenses). The Company believes each of the allegations lack merit and intends to vigorously defend against them. |
NATURE OF BUSINESS AND BASIS _2
NATURE OF BUSINESS AND BASIS OF PRESENTATION (Policies) | 9 Months Ended |
Nov. 01, 2020 | |
NATURE OF BUSINESS AND BASIS OF PRESENTATION | |
Nature of Business | Nature of Business HD Supply Holdings, Inc. (‘‘Holdings’’) indirectly owns all of the outstanding common stock of HD Supply, Inc. (“HDS”). Holdings, together with its direct and indirect subsidiaries, including HDS (“HD Supply” or the “Company”), is one of the largest industrial distribution companies in North America. The Company specializes in the Maintenance, Repair & Operations market sector. Through approximately 44 distribution centers in the U.S. and Canada, the Company serves this market with an integrated go-to-market strategy. HD Supply has more than 5,500 associates delivering localized, customer-tailored products, services and expertise. The Company serves approximately 300,000 customers, which include contractors, maintenance professionals, industrial businesses, and government entities primarily in multifamily, hospitality, healthcare, and institutional facilities markets. HD Supply’s broad range of end-to-end product lines and services includes approximately 200,000 stock-keeping units of quality, name-brand and proprietary-brand products as well as value-add services. HD Supply reports results of operations as one reportable segment. See “Note 2 — Discontinued Operations” for further information on the sale of the Construction & Industrial business, a previous HD Supply reportable segment. |
Basis of Presentation | Basis of Presentation In management’s opinion, the unaudited financial information for the interim periods presented includes all adjustments necessary for a fair statement of the results of operations, financial position, and cash flows. All adjustments are of a normal recurring nature unless otherwise disclosed. Revenues, expenses, assets and liabilities can vary during each quarter of the year. Therefore, the results and trends in these interim financial statements may not be the same as those for the full year. For a more complete discussion of the Company’s significant accounting policies and other information, you should read this report in conjunction with the Company’s annual report on Form 10-K for the year ended February 2, 2020, which includes all disclosures required by generally accepted accounting principles in the United States of America (“GAAP”). |
Fiscal Year | F iscal Year HD Supply’s fiscal year is a 52 53 |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements of Holdings present the results of operations, financial position and cash flows of Holdings and its wholly-owned subsidiaries, including HDS. The consolidated financial statements of HDS present the results of operations, financial position and cash flows of HDS and its wholly-owned subsidiaries. All material intercompany balances and transactions are eliminated. Results of operations of businesses acquired are included from their respective dates of acquisition. The results of operations of all discontinued operations have been separately reported as discontinued operations for all periods presented. |
Estimates | Estimates Management has made a number of estimates and assumptions relating to the reporting of assets and liabilities, the disclosure of contingent assets and liabilities, and reported amounts of revenues and expenses in preparing these consolidated financial statements in conformity with GAAP. Actual results could differ from these estimates. |
Self-Insurance | Self-Insurance HD Supply has a high-deductible insurance program for most losses related to general liability, product liability, environmental liability, automobile liability, workers’ compensation, and is self-insured for certain legal claims and medical claims, while maintaining per employee stop-loss coverage. The expected ultimate cost for claims incurred as of the balance sheet date is not discounted and is recognized as a liability. Self-insurance losses for claims filed and claims incurred but not reported are accrued based upon estimates of the aggregate liability for uninsured claims using loss development factors and actuarial assumptions followed in the insurance industry and historical loss development experience. As of November 1, 2020 and February 2, 2020, self-insurance reserves for continuing operations totaled approximately $28.8 million and $27.9 million, respectively. At February 2, 2020, self-insurance reserves classified as discontinued operations totaled approximately $22.0 million. See "Note 2 - Discontinued Operations" for further information on the sale of Construction & Industrial. |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 9 Months Ended |
Nov. 01, 2020 | |
DISCONTINUED OPERATIONS | |
Schedule of results of operations of discontinued operations, primarily the Construction & Industrial business | The following table provides additional detail related to the results of operations of the discontinued operations, primarily the Construction & Industrial business (amounts in millions): Three Months Ended Nine Months Ended November 1, November 3, November 1, November 3, 2020 2019 2020 2019 Net sales $ 687.9 $ 818.0 $ 2,193.9 $ 2,334.5 Cost of sales 441.0 529.5 1,410.9 1,513.7 Gross Profit 246.9 288.5 783.0 820.8 Operating expenses: Selling, general and administrative 153.2 195.3 517.9 566.5 Depreciation and amortization 1.0 11.0 21.6 31.8 Restructuring & separation Charges 8.4 2.1 14.6 2.1 Total operating expenses 162.6 208.4 554.1 600.4 Operating Income 84.3 80.1 228.9 220.4 Gain on disposal of discontinued operations 1,767.0 — 1,762.0 — Income before provision for income taxes 1,851.3 80.1 1,990.9 220.4 Provision for income taxes 278.6 21.6 313.6 59.1 Income from discontinued operations, net of tax $ 1,572.7 $ 58.5 $ 1,677.3 $ 161.3 At November 1, 2020 and February 2, 2020, the carrying amounts of major classes of assets and liabilities of the Construction & Industrial discontinued operations included in the Consolidated Balance Sheets were as follows (amounts in millions): November 1, February 2, 2020 2020 Current assets: Receivables, less allowance for credit losses of $- and $11.7 $ — $ 392.5 Inventories — 344.3 Other current assets — 11.2 Total current assets — 748.0 Property and equipment, net — 119.6 Operating lease right-of-use assets 246.9 Goodwill — 386.1 Intangible assets, net — 106.1 Other non-current assets — 2.8 Total non-current assets — 861.5 Total assets of discontinued operations $ — $ 1,609.5 Current Liabilities: Accounts payable $ — $ 195.2 Accrued compensation and benefits — 33.0 Current lease liabilities — 59.2 Other current liabilities — 53.8 Total current liabilities — 341.2 Long-term lease liabilities — 190.8 Other non-current liabilities — 13.0 Total non-current liabilities — 203.8 Total liabilities of discontinued operations $ — $ 545.0 The following table provides additional detail related to the net cash provided by operating and investing activities of the discontinued operations (amounts in millions): Nine Months Ended November 1, November 3, 2020 2019 Net cash flows provided by operating activities $ 266.5 $ 251.5 Cash flows from investing activities: Capital expenditures (18.7) (35.2) Proceeds from sales of businesses, net 2,845.5 — Payments for businesses acquired, net — 2.8 Proceeds from sales of property and equipment, net 0.3 0.4 Net cash flows provided by investing activities $ 2,827.1 $ (32.0) |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Nov. 01, 2020 | |
DEBT | |
Schedule of long-term debt | HDS’s long-term debt as of November 1, 2020 and February 2, 2020 consisted of the following (dollars in millions): November 1, 2020 February 2, 2020 Outstanding Interest Outstanding Interest Principal Rate % (1) Principal Rate % (1) Senior ABL Facility due 2022 $ — — $ 260.3 3.15 Term B-5 Loans due 2023 524.3 1.90 1,056.6 3.40 October 2018 Senior Unsecured Notes due 2026 750.0 5.375 750.0 5.375 Total gross long-term debt $ 1,274.3 $ 2,066.9 Less unamortized discount (1.2) (3.0) Less unamortized deferred financing costs (11.6) (17.8) Total net long-term debt $ 1,261.5 $ 2,046.1 Less current installments (10.7) (10.7) Total net long-term debt, excluding current installments $ 1,250.8 $ 2,035.4 (1) Represents the stated rate of interest, without including the effect of discounts, premiums, or interest rate swap agreements. |
October 2018 Senior Unsecured Notes due 2026 | |
DEBT | |
Schedule of notes redemption on and after October 15, 2021, at the applicable redemption price set forth below (expressed as a percentage of principal amount) | Year Percentage 2021 102.688 % 2022 101.344 % 2023 and thereafter 100.000 % |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Nov. 01, 2020 | |
FAIR VALUE MEASUREMENTS | |
Schedule of financial instruments that are not reflected at fair value on the balance sheet | The Company’s financial instruments that are not reflected at fair value on the Consolidated Balance Sheets were as follows as of November 1, 2020 and February 2, 2020 (amounts in millions): As of November 1,2020 As of February 2, 2020 Recorded Estimated Recorded Estimated Amount (1) Fair Value Amount (1) Fair Value Senior ABL Facility $ — $ — $ 260.3 $ 260.0 Term Loans and Notes 1,274.3 1,308.2 1,806.6 1,862.0 Total $ 1,274.3 $ 1,308.2 $ 2,066.9 $ 2,122.0 (1) These amounts do not include accrued interest; accrued interest is classified as Other current liabilities in the accompanying Consolidated Balance Sheets. These amounts do not include any related discounts, premiums, or deferred financing costs. |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) | 9 Months Ended |
Nov. 01, 2020 | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | |
Schedule of balances and changes in AOCI, net of tax by component | Three Months Ended Nine Months Ended November 1, November 3, November 1, November 3, 2020 2019 2020 2019 Foreign currency translation adjustment: Beginning balance $ (14.9) $ (15.3) $ (15.2) $ (15.4) Other comprehensive income (loss) before reclassifications (0.8) — (0.5) 0.1 Amounts reclassified from AOCI into earnings (1) 15.5 — 15.5 — Ending balance $ (0.2) $ (15.3) $ (0.2) $ (15.3) Cash flow hedge, net of tax: Beginning balance $ (51.4) $ (35.4) $ (36.9) $ (15.3) Other comprehensive income (loss) before reclassifications (13.0) (2.1) (36.0) (24.6) Amounts reclassified from AOCI into earnings (2) 48.6 1.8 57.1 4.1 Other — — — 0.1 Ending balance, net of tax of $5.4, $12.3, $5.4, and $12.3 $ (15.8) $ (35.7) $ (15.8) $ (35.7) Total ending balance of AOCI $ (16.0) $ (51.0) $ (16.0) $ (51.0) (1) Comprised of unrealized loss reclassified into Income from discontinued operations, net of tax, for the sale of the Construction & Industrial business. (2) Comprised of unrealized loss reclassified into Interest expense in all periods. The three and nine months ended November 1, 2020 also include $43.6 million recognized loss on the termination of $500.0 million notional value of the interest rate swap reclassified into Other (income) expense, net. For further information, see "Note 4 - Derivative Instruments." |
BASIC AND DILUTED WEIGHTED-AV_2
BASIC AND DILUTED WEIGHTED-AVERAGE COMMON SHARES (Tables) | 9 Months Ended |
Nov. 01, 2020 | |
BASIC AND DILUTED WEIGHTED-AVERAGE COMMON SHARES | |
Schedule of reconciliation of basic to diluted weighted-average common shares | The reconciliation of basic to diluted weighted-average common shares for the three and nine months ended November 1, 2020 and November 3, 2019 was as follows (in thousands): Three Months Ended Nine Months Ended November 1, 2020 November 3, 2019 November 1, 2020 November 3, 2019 Weighted-average common shares 159,057 164,638 160,271 168,062 Effect of potentially dilutive stock plan securities 747 504 482 583 Diluted weighted-average common shares 159,804 165,142 160,753 168,645 Stock plan securities excluded from dilution (1) 2,431 2,025 3,528 2,741 (1) Represents securities not included in the computation of diluted earnings per share because their effect would have been anti-dilutive. |
SUPPLEMENTAL BALANCE SHEET AN_2
SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION (Tables) | 9 Months Ended |
Nov. 01, 2020 | |
SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION | |
Schedule of receivables | Receivables as of November 1, 2020 and February 2, 2020 consisted of the following (amounts in millions): HD Supply Holdings, Inc. HD Supply, Inc. November 1, 2020 February 2, 2020 November 1, 2020 February 2, 2020 Trade receivables, net of allowance for credit losses $ 356.9 $ 324.9 $ 356.9 $ 324.9 Vendor rebate receivables 26.2 23.8 26.2 23.8 Other receivables 17.0 13.4 16.9 13.3 Total receivables, net $ 400.1 $ 362.1 $ 400.0 $ 362.0 |
Schedule of other current liabilities | Other current liabilities as of November 1, 2020 and February 2, 2020 consisted of the following (amounts in millions): HD Supply Holdings, Inc. HD Supply, Inc. November 1, February 2, November 1, February 2, 2020 2020 2020 2020 Accrued legal $ 53.7 50.6 $ 53.7 50.6 Unsettled share repurchases 20.4 — — — Accrued non-income taxes 19.7 14.7 19.7 14.7 Accrued interest 2.3 13.2 2.3 13.2 Other 105.0 76.3 105.0 76.3 Total other current liabilities $ 201.1 $ 154.8 $ 180.7 $ 154.8 |
Schedule of share repurchases | Holdings’ share repurchases under these plans for the nine months ended November 1, 2020 and November 3, 2019 were as follows (dollars in millions): Nine Months Ended November 1, 2020 November 3, 2019 Number Cost of Number Cost of September 2020 Plan — $ — — $ — March 2020 Plan 6,321,661 258.3 — — November 2018 Plan — — 8,161,079 316.0 April 2014 Plan 241,474 9.0 158,734 6.8 Total share repurchases 6,563,135 $ 267.3 8,319,813 $ 322.8 |
REVENUE (Tables)
REVENUE (Tables) | 9 Months Ended |
Nov. 01, 2020 | |
REVENUE | |
Schedule of Facilities Maintenance and Construction & Industrial with Inter-segment eliminations | The table below represents disaggregated revenue for the Company (amounts in millions): Three Months Ended Nine Months Ended November 1, 2020 November 3, 2019 November 1, 2020 November 3, 2019 Maintenance, Repair, and Operations $ 742.7 $ 725.9 $ 2,040.1 $ 2,149.2 Property Improvement 84.8 99.3 228.9 276.8 Total Net Sales $ 827.5 $ 825.2 $ 2,269.0 $ 2,426.0 |
NATURE OF BUSINESS AND BASIS _3
NATURE OF BUSINESS AND BASIS OF PRESENTATION - Nature of Business (Details) | 9 Months Ended |
Nov. 01, 2020productsegmentemployeecustomeritem | |
Nature of Business | |
Number of customers | customer | 300,000 |
Number of SKUs offered | product | 200,000 |
Number of reportable segments | segment | 1 |
Minimum | |
Nature of Business | |
Number of associates | employee | 5,500 |
U.S. and Canada | |
Nature of Business | |
Number of distribution centers | item | 44 |
NATURE OF BUSINESS AND BASIS _4
NATURE OF BUSINESS AND BASIS OF PRESENTATION - Fiscal Year (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Nov. 01, 2020 | Nov. 03, 2019 | Nov. 01, 2020 | Nov. 03, 2019 | Jan. 31, 2021 | Feb. 02, 2020 | |
Length of fiscal year (in days) | 364 days | 364 days | ||||
Length of fiscal quarter (in days) | 91 days | 91 days | 273 days | 273 days | ||
Minimum | ||||||
Length of fiscal year (in days) | 364 days | |||||
Maximum | ||||||
Length of fiscal year (in days) | 371 days |
NATURE OF BUSINESS AND BASIS _5
NATURE OF BUSINESS AND BASIS OF PRESENTATION - Self-Insurance (Details) - USD ($) $ in Millions | Nov. 01, 2020 | Feb. 02, 2020 |
Continuing Operations | ||
NATURE OF BUSINESS AND BASIS OF PRESENTATION | ||
Self-insurance reserves | $ 28.8 | $ 27.9 |
Discontinued Operation | ||
NATURE OF BUSINESS AND BASIS OF PRESENTATION | ||
Self-insurance reserves | $ 22 |
DISCONTINUED OPERATIONS - Gener
DISCONTINUED OPERATIONS - General Information (Details) - USD ($) $ in Millions | Oct. 19, 2020 | Nov. 01, 2020 | Nov. 01, 2020 |
DISCONTINUED OPERATIONS | |||
Proceeds from sales of businesses, net | $ 2,845.5 | ||
Constructions And Industrial Business [Member] | Discontinued operations | |||
DISCONTINUED OPERATIONS | |||
Proceeds from sales of businesses, net | $ 2,800 | ||
Transaction costs | $ 34.9 | ||
Gain on sale of business, net of tax | $ 1,500 | 1,500 | |
Tax effect of gain from disposal of discontinued operations | $ 257.1 | $ 257.1 |
DISCONTINUED OPERATIONS - Resul
DISCONTINUED OPERATIONS - Results of Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 01, 2020 | Nov. 03, 2019 | Nov. 01, 2020 | Nov. 03, 2019 | |
Operating expenses: | ||||
Income from discontinued operations, net of tax | $ 1,572.7 | $ 58.5 | $ 1,677.3 | $ 161.3 |
Discontinued operations | Construction And Industrial Business [Member] | ||||
Results of operations of the discontinued operations | ||||
Net sales | 687.9 | 818 | 2,193.9 | 2,334.5 |
Cost of sales | 441 | 529.5 | 1,410.9 | 1,513.7 |
Gross Profit | 246.9 | 288.5 | 783 | 820.8 |
Operating expenses: | ||||
Selling, general and administrative | 153.2 | 195.3 | 517.9 | 566.5 |
Depreciation and amortization | 1 | 11 | 21.6 | 31.8 |
Restructuring & separation Charges | 8.4 | 2.1 | 14.6 | 2.1 |
Total operating expenses | 162.6 | 208.4 | 554.1 | 600.4 |
Operating Income | 84.3 | 80.1 | 228.9 | 220.4 |
Gain on disposal of discontinued operations | 1,767 | 1,762 | ||
Income before provision for income taxes | 1,851.3 | 80.1 | 1,990.9 | 220.4 |
Provision for income taxes | 278.6 | 21.6 | 313.6 | 59.1 |
Income from discontinued operations, net of tax | $ 1,572.7 | $ 58.5 | $ 1,677.3 | $ 161.3 |
DISCONTINUED OPERATIONS - Carry
DISCONTINUED OPERATIONS - Carrying Amounts of Major Classes of Assets and Liabilities (Details) $ in Millions | Feb. 02, 2020USD ($) |
Current assets: | |
Total current assets | $ 748 |
Total non-current assets | 861.5 |
Current Liabilities: | |
Total current liabilities | 341.2 |
Total non-current liabilities | 203.8 |
Discontinued operations | Construction And Industrial Business [Member] | |
Current assets: | |
Receivables, less allowance for credit losses of $ - and $11.7 | 392.5 |
Inventories | 344.3 |
Other current assets | 11.2 |
Total current assets | 748 |
Property and equipment, net | 119.6 |
Operating lease right-of-use assets | 246.9 |
Goodwill | 386.1 |
Intangible assets, net | 106.1 |
Other non-current assets | 2.8 |
Total non-current assets | 861.5 |
Total assets of discontinued operations | 1,609.5 |
Current Liabilities: | |
Accounts payable | 195.2 |
Accrued compensation and benefits | 33 |
Current lease liabilities | 59.2 |
Other current liabilities | 53.8 |
Total current liabilities | 341.2 |
Long-term lease liabilities | 190.8 |
Other non-current liabilities | 13 |
Total non-current liabilities | 203.8 |
Total liabilities of discontinued operations | 545 |
gaap_DisposalGroupIncludingDiscontinuedOperationClassifiedBalanceSheetDisclosuresAbstract | |
Receivables, Allowance for credit losses | $ 11.7 |
DISCONTINUED OPERATIONS - Net C
DISCONTINUED OPERATIONS - Net Cash Provided by Operating Activities and Investing Activities (Details) - USD ($) $ in Millions | 9 Months Ended | |
Nov. 01, 2020 | Nov. 03, 2019 | |
Cash flows from investing activities: | ||
Proceeds from sales of businesses, net | $ 2,845.5 | |
Payments for businesses acquired, net of cash acquired | $ (9.4) | |
Proceeds from sales of property and equipment | 0.3 | 2.7 |
Discontinued operations | Construction And Industrial Business [Member] | ||
Net cash provided by operating and investing activities of the discontinued operations | ||
Net cash flows provided by operating activities | 266.5 | 251.5 |
Cash flows from investing activities: | ||
Capital expenditures | (18.7) | (35.2) |
Proceeds from sales of businesses, net | 2,845.5 | |
Payments for businesses acquired, net of cash acquired | 2.8 | |
Proceeds from sales of property and equipment | 0.3 | 0.4 |
Net cash flows provided by investing activities | $ 2,827.1 | $ (32) |
DEBT - Gross Long-term Debt - I
DEBT - Gross Long-term Debt - Interest Rate - Tabular Disclosure (Details) - Subsidiary Issuer | Nov. 01, 2020 | Feb. 02, 2020 | Oct. 11, 2018 |
Secured debt | Line of credit | Senior ABL Facility due 2022 | |||
DEBT | |||
Interest rate, rate at end of period (as a percent) | 3.15% | ||
Secured debt | Line of credit | Term B-5 Loans due 2023 | |||
DEBT | |||
Interest rate, rate at end of period (as a percent) | 1.90% | 3.40% | |
Unsecured debt | October 2018 Senior Unsecured Notes due 2026 | |||
DEBT | |||
Interest rate, stated rate (as a percent) | 5.375% | 5.375% | 5.375% |
DEBT - Gross Long-term Debt - O
DEBT - Gross Long-term Debt - Outstanding Principal - Tabular Disclosure (Details) - USD ($) $ in Millions | Nov. 01, 2020 | Feb. 02, 2020 |
DEBT | ||
Total gross long-term debt | $ 1,274.3 | $ 2,066.9 |
Subsidiary Issuer | Secured debt | Line of credit | Senior ABL Facility due 2022 | ||
DEBT | ||
Total gross long-term debt | 260.3 | |
Subsidiary Issuer | Secured debt | Line of credit | Term B-5 Loans due 2023 | ||
DEBT | ||
Total gross long-term debt | 524.3 | 1,056.6 |
Subsidiary Issuer | Unsecured debt | October 2018 Senior Unsecured Notes due 2026 | ||
DEBT | ||
Total gross long-term debt | $ 750 | $ 750 |
DEBT - Total Net Long-term Debt
DEBT - Total Net Long-term Debt - Tabular Disclosure (Details) - USD ($) $ in Millions | Nov. 01, 2020 | Feb. 02, 2020 |
DEBT | ||
Total gross long-term debt | $ 1,274.3 | $ 2,066.9 |
Less unamortized discount | (1.2) | (3) |
Less unamortized deferred financing costs | (11.6) | (17.8) |
Total net long-term debt | $ 1,261.5 | $ 2,046.1 |
DEBT - Total Long-term Debt, Ex
DEBT - Total Long-term Debt, Excluding Current Installments - Tabular Disclosure (Details) - USD ($) $ in Millions | Nov. 01, 2020 | Feb. 02, 2020 |
DEBT | ||
Total net long-term debt | $ 1,261.5 | $ 2,046.1 |
Less current installments | (10.7) | (10.7) |
Total net long-term debt, excluding current installments | $ 1,250.8 | $ 2,035.4 |
DEBT - Senior ABL Facility (Det
DEBT - Senior ABL Facility (Details) and Debt Transactions $ in Millions | Oct. 20, 2020USD ($) | Nov. 01, 2020USD ($) | Nov. 01, 2020USD ($)facility | Feb. 02, 2020USD ($) |
DEBT | ||||
Debt Instrument, Unamortized Discount | $ 1.2 | $ 1.2 | $ 3 | |
Gain (loss) on extinguishment | (5.5) | (5.5) | ||
Secured debt | Subsidiary Issuer | Line of credit | Senior ABL Facility due 2022 | ||||
DEBT | ||||
Aggregate principal amount | 600 | 600 | ||
Line of credit facility, Excess Availability for borrowing | 576.1 | 576.1 | ||
Letter of credit facility outstanding | 23.8 | 23.8 | ||
Line of credit facility, available for borrowing on qualifying cash balances | $ 139.4 | $ 139.4 | ||
The minimum number of incremental term loan facilities permitted to be included in the Senior ABL Facility | facility | 1 | |||
The minimum number of revolving credit facility commitments permitted to be included in the Senior ABL Facility | facility | 1 | |||
Total borrowing capacity | $ 600 | |||
Gain (loss) on extinguishment | (0.8) | |||
Secured debt | Subsidiary Issuer | Line of credit | Term B-5 Loans due 2023 | ||||
DEBT | ||||
Gain (loss) on extinguishment | (4.7) | |||
Repayment of debt | 524.3 | |||
Write-offs of unamortized original issue discount | 1.2 | |||
Write-offs of unamortized deferred financing costs | 3.5 | |||
Canada | Secured debt | Subsidiary Issuer | Line of credit | Senior ABL Facility due 2022 | ||||
DEBT | ||||
Reduction in borrowing capacity | 60 | |||
U.S. | Secured debt | Subsidiary Issuer | Line of credit | Senior ABL Facility due 2022 | ||||
DEBT | ||||
Reduction in borrowing capacity | $ 340 |
DEBT - Senior Term Loan Facilit
DEBT - Senior Term Loan Facility (Details) - Subsidiary Issuer - Secured debt - Line of credit $ in Millions | 9 Months Ended |
Nov. 01, 2020USD ($) | |
Term Loan Facility | |
DEBT | |
Aggregate principal amount | $ 1,070 |
Term B-5 Loans due 2023 | |
DEBT | |
Amortization of debt, aggregate annual amounts as a percentage of original principal amount (as a percent) | 1.00% |
Term B-4 Loans due 2023 | |
DEBT | |
Aggregate principal amount | $ 524.3 |
Senior ABL Facility due 2022 | |
DEBT | |
Aggregate principal amount | $ 600 |
Base | Term B-5 Loans due 2023 | |
DEBT | |
Percentage added to reference rate (as a percent) | 0.75% |
Eurocurrency | Term B-5 Loans due 2023 | |
DEBT | |
Percentage added to reference rate (as a percent) | 1.75% |
DEBT - 5.375% Senior Unsecured
DEBT - 5.375% Senior Unsecured Notes due 2026 (Details) - Unsecured debt - October 2018 Senior Unsecured Notes due 2026 - USD ($) $ in Millions | 9 Months Ended | ||
Nov. 01, 2020 | Feb. 02, 2020 | Oct. 11, 2018 | |
Prior to October 15, 2021 | |||
DEBT | |||
Threshold percentage for debt that must remain after each redemption | 50.00% | ||
Subsidiary Issuer | |||
DEBT | |||
Aggregate principal amount | $ 750 | ||
Interest rate | 5.375% | 5.375% | 5.375% |
Subsidiary Issuer | Prior to October 15, 2021 | |||
DEBT | |||
Optional prepayment price percentage | 100.00% | ||
Percentage limit on amount that can be redeemed | 40.00% | ||
Prepayment percentage price as a percent of the principal, with proceeds from certain equity offerings | 105.375% | ||
Subsidiary Issuer | 2021 | |||
DEBT | |||
Optional prepayment price percentage | 102.688% | ||
Subsidiary Issuer | 2022 | |||
DEBT | |||
Optional prepayment price percentage | 101.344% | ||
Subsidiary Issuer | 2023 and thereafter | |||
DEBT | |||
Optional prepayment price percentage | 100.00% |
DERIVATIVE INSTRUMENTS (Details
DERIVATIVE INSTRUMENTS (Details) - USD ($) $ in Millions | Oct. 20, 2020 | Oct. 23, 2018 | Nov. 01, 2020 | Nov. 03, 2019 | Nov. 01, 2020 | Nov. 03, 2019 | Feb. 02, 2020 | Oct. 24, 2018 |
DERIVATIVE INSTRUMENTS | ||||||||
Loss incurred to repay the pro-rata portion of the outstanding liability | $ 35.6 | $ (0.3) | $ 21.1 | $ (20.5) | ||||
Derivatives designated as hedging instruments | Interest rate swap | Cash flow hedges | ||||||||
DERIVATIVE INSTRUMENTS | ||||||||
Notional amount of derivative liability | $ 250 | $ 750 | ||||||
Fixed interest rate percentage | 3.07% | |||||||
Cash flow hedge liabilities at fair value | 21.2 | 21.2 | $ 49.8 | |||||
Notional amount terminated | 500 | 500 | 500 | |||||
Derivative Liability, Notional Amount | 250 | $ 750 | ||||||
Payments made to settle liability and accrued interest | $ 44.4 | |||||||
Loss on termination of derivatives | 43.6 | 43.6 | ||||||
Derivatives designated as hedging instruments | Interest rate swap | Cash flow hedges | Other current liabilities | ||||||||
DERIVATIVE INSTRUMENTS | ||||||||
Cash flow hedge liabilities at fair value | 7.4 | 7.4 | 11.6 | |||||
Derivatives designated as hedging instruments | Interest rate swap | Cash flow hedges | Other liabilities | ||||||||
DERIVATIVE INSTRUMENTS | ||||||||
Cash flow hedge liabilities at fair value | $ 13.8 | $ 13.8 | $ 38.2 | |||||
Derivatives designated as hedging instruments | Interest rate swap | Cash flow hedges | LIBOR | Term B-5 Loans due 2023 | ||||||||
DERIVATIVE INSTRUMENTS | ||||||||
Interest rate | 4.82% | |||||||
Percentage added to reference rate (as a percent) | 1.75% |
FAIR VALUE MEASUREMENTS - Fair
FAIR VALUE MEASUREMENTS - Fair value on consolidated balance sheets (Details) - USD ($) $ in Millions | Nov. 01, 2020 | Feb. 02, 2020 |
Recorded Amount | ||
Financial instruments not reflected at fair value on the balance sheet | ||
Senior ABL Facility | $ 260.3 | |
Term Loans and Notes | $ 1,274.3 | 1,806.6 |
Total | 1,274.3 | 2,066.9 |
Estimated Fair Value | Significant Other Observable Inputs (Level 2) | ||
Financial instruments not reflected at fair value on the balance sheet | ||
Senior ABL Facility | 260 | |
Term Loans and Notes | 1,308.2 | 1,862 |
Total | $ 1,308.2 | $ 2,122 |
INCOME TAXES - Tax items (Detai
INCOME TAXES - Tax items (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Nov. 01, 2020 | Nov. 03, 2019 | Feb. 02, 2020 | |
INCOME TAXES | |||
Combined federal, state and foreign effective tax rate | 25.80% | 25.10% | |
Unrecognized tax benefits | $ 17.1 | $ 17.1 | |
Net accrual for interest and penalties related to unrecognized tax benefits | 0 | 0 | |
Deferred tax assets, valuation allowance | $ 5.4 | $ 6 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Nov. 01, 2020 | Nov. 03, 2019 | Nov. 01, 2020 | Nov. 03, 2019 | Oct. 20, 2020 | |
Changes in accumulated other comprehensive income (loss) | |||||
Beginning balance | $ (52.1) | ||||
Ending balance | $ (16) | (16) | |||
Cashflow hedge, tax | (12.5) | $ 0.1 | (7.5) | $ 7.1 | |
AOCI net of tax | |||||
Changes in accumulated other comprehensive income (loss) | |||||
Ending balance | (16) | (51) | (16) | (51) | |
Foreign currency translation adjustment | |||||
Changes in accumulated other comprehensive income (loss) | |||||
Beginning balance | (14.9) | (15.3) | (15.2) | (15.4) | |
Other comprehensive income (loss) before reclassifications | (0.8) | (0.5) | 0.1 | ||
Amounts reclassified from AOCI into earnings | 15.5 | 15.5 | |||
Ending balance | (0.2) | (15.3) | (0.2) | (15.3) | |
Cash flow hedge, net of tax | |||||
Changes in accumulated other comprehensive income (loss) | |||||
Beginning balance | (51.4) | (35.4) | (36.9) | (15.3) | |
Other comprehensive income (loss) before reclassifications | (13) | (2.1) | (36) | (24.6) | |
Amounts reclassified from AOCI into earnings | 48.6 | 1.8 | 57.1 | 4.1 | |
Other | 0.1 | ||||
Ending balance | (15.8) | (35.7) | (15.8) | (35.7) | |
Cashflow hedge, tax | 5.4 | $ 12.3 | 5.4 | $ 12.3 | |
Cash flow hedges | Interest rate swap | Derivatives designated as hedging instruments | |||||
Changes in accumulated other comprehensive income (loss) | |||||
Loss on termination of derivatives | 43.6 | 43.6 | |||
Notional value of the interest rate swap | $ 500 | $ 500 | $ 500 |
BASIC AND DILUTED WEIGHTED-AV_3
BASIC AND DILUTED WEIGHTED-AVERAGE COMMON SHARES - Reconciliation of Basic to Diluted Weighted-Average Common Shares (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Nov. 01, 2020 | Nov. 03, 2019 | Nov. 01, 2020 | Nov. 03, 2019 | |
Reconciliation of basic to diluted weighted-average common shares | ||||
Weighted-average common shares outstanding | 159,057 | 164,638 | 160,271 | 168,062 |
Effect of potentially dilutive stock plan securities | 747 | 504 | 482 | 583 |
Diluted weighted-average common shares outstanding | 159,804 | 165,142 | 160,753 | 168,645 |
BASIC AND DILUTED WEIGHTED-AV_4
BASIC AND DILUTED WEIGHTED-AVERAGE COMMON SHARES - Anti-dilutive Securities (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Nov. 01, 2020 | Nov. 03, 2019 | Nov. 01, 2020 | Nov. 03, 2019 | |
Anti-dilutive securities | ||||
Stock plan securities excluded from dilution | 2,431 | 2,025 | 3,528 | 2,741 |
SUPPLEMENTAL BALANCE SHEET AN_3
SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION - Receivables (Details) - USD ($) $ in Millions | Nov. 01, 2020 | Feb. 02, 2020 |
Receivables | ||
Total receivables, net | $ 400.1 | $ 362.1 |
HD Supply, Inc. | ||
Receivables | ||
Trade receivables, net of allowance for credit losses | 356.9 | 324.9 |
Vendor rebate receivables | 26.2 | 23.8 |
Other receivables | 16.9 | 13.3 |
Total receivables, net | 400 | 362 |
HD Supply Holdings, Inc. | ||
Receivables | ||
Trade receivables, net of allowance for credit losses | 356.9 | 324.9 |
Vendor rebate receivables | 26.2 | 23.8 |
Other receivables | 17 | 13.4 |
Total receivables, net | $ 400.1 | $ 362.1 |
SUPPLEMENTAL BALANCE SHEET AN_4
SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION - Other Current Liabilities (Details) - USD ($) $ in Millions | Nov. 01, 2020 | Feb. 02, 2020 | Nov. 01, 2019 |
Other Current Liabilities | |||
Accrued income taxes | $ 282.3 | ||
Total other current liabilities | 201.1 | $ 154.8 | |
Other current liabilities | Shareholder class action lawsuit | |||
Other Current Liabilities | |||
Accrued legal | 50 | 50 | |
Other current liabilities | Derivative shareholder complaints settlement | |||
Other Current Liabilities | |||
Accrued legal | 1.9 | ||
Other current assets | Shareholder class action lawsuit | |||
Other Current Liabilities | |||
Insurance recovery | 50 | 50 | |
Other current assets | Derivative shareholder complaints settlement | |||
Other Current Liabilities | |||
Insurance recovery | $ 1.9 | ||
HD Supply Holdings, Inc. | |||
Other Current Liabilities | |||
Accrued legal | 53.7 | 50.6 | |
Unsettled share repurchases | 20.4 | ||
Accrued non-income taxes | 19.7 | 14.7 | |
Accrued interest | 2.3 | 13.2 | |
Other | 105 | 76.3 | |
Total other current liabilities | 201.1 | 154.8 | |
HD Supply, Inc. | |||
Other Current Liabilities | |||
Accrued legal | 53.7 | 50.6 | |
Accrued non-income taxes | 19.7 | 14.7 | |
Accrued interest | 2.3 | 13.2 | |
Other | 105 | 76.3 | |
Total other current liabilities | $ 180.7 | $ 154.8 |
SUPPLEMENTAL BALANCE SHEET AN_5
SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION - Supplemental Cash Flow Information (Details) - USD ($) $ in Millions | 9 Months Ended | |
Nov. 01, 2020 | Nov. 03, 2019 | |
Supplemental Cash Flow Information | ||
Cash paid for interest | $ 77.5 | $ 89.2 |
Cash paid for income taxes, net of refunds | 83.5 | 35.3 |
Other liabilities | ||
Supplemental Cash Flow Information | ||
Deferred FICA payments | 21.7 | |
HD Supply, Inc. | ||
Supplemental Cash Flow Information | ||
Cash equity distribution | $ 242.4 | $ 319.2 |
SUPPLEMENTAL BALANCE SHEET AN_6
SUPPLEMENTAL BALANCE SHEET AND CASH FLOW INFORMATION - Share Repurchases (Details) - Common Stock $ in Millions | 1 Months Ended | 9 Months Ended | ||||
Sep. 30, 2020USD ($)item | Mar. 31, 2020USD ($)item | Nov. 30, 2018USD ($)item | Nov. 01, 2020USD ($)shares | Nov. 03, 2019USD ($)shares | Jan. 31, 2020USD ($) | |
Share repurchases | ||||||
Number of Shares | shares | 6,563,135 | 8,319,813 | ||||
Cost of Shares | $ 267.3 | $ 322.8 | ||||
Share Repurchase Program Of September 2020 | ||||||
Share repurchases | ||||||
Number of share repurchase programs | item | 3 | |||||
Authorized share repurchase amount | $ 500 | |||||
Share Repurchase Program of March 2020 | ||||||
Share repurchases | ||||||
Number of share repurchase programs | item | 3 | |||||
Authorized share repurchase amount | $ 500 | |||||
Number of Shares | shares | 6,321,661 | |||||
Cost of Shares | $ 258.3 | |||||
Share Repurchase Program of November 2018 Plan | ||||||
Share repurchases | ||||||
Number of share repurchase programs | item | 3 | |||||
Authorized share repurchase amount | $ 500 | $ 500 | ||||
Number of Shares | shares | 8,161,079 | |||||
Cost of Shares | $ 316 | |||||
Share Repurchase Program of April 2014 Plan | ||||||
Share repurchases | ||||||
Number of Shares | shares | 241,474 | 158,734 | ||||
Cost of Shares | $ 9 | $ 6.8 |
RESTRUCTURING AND SEPARATION _2
RESTRUCTURING AND SEPARATION ACTIVITIES (Details) $ in Millions | Sep. 24, 2019item | Nov. 01, 2020USD ($) | Nov. 03, 2019USD ($) | Nov. 01, 2020USD ($) | Nov. 03, 2019USD ($) |
Restructuring activities | |||||
Restructuring and separation charges | $ 3.9 | $ 1.3 | $ 7.6 | $ (0.4) | |
Separation of Facilities Maintenance and Construction and Industrial businesses | Separation of business | |||||
Restructuring activities | |||||
Number of companies after separation | item | 2 | ||||
Separation of Facilities Maintenance and Construction and Industrial businesses | Lease termination | |||||
Restructuring activities | |||||
Restructuring and separation charges | $ 3.9 | $ 7.6 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Legal Matters (Details) $ in Millions | Dec. 04, 2020USD ($) | Jan. 30, 2020USD ($) | Nov. 01, 2020USD ($) | Aug. 08, 2017complaint |
Legal Matters | ||||
Settlement amount | $ 50 | |||
Number of shareholder derivative complaints | complaint | 2 | |||
Minimum | ||||
Legal Matters | ||||
Estimated aggregate potential loss | $ 0 | |||
Maximum | ||||
Legal Matters | ||||
Estimated aggregate potential loss | $ 10 | |||
Maximum amount to pay or cause to be paid for a reasonable attorneys' fee | $ 1.9 |
REVENUE - Disaggregation of Rev
REVENUE - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 01, 2020 | Nov. 03, 2019 | Nov. 01, 2020 | Nov. 03, 2019 | |
Disaggregation of Revenue | ||||
Total Net Sales | $ 827.5 | $ 825.2 | $ 2,269 | $ 2,426 |
Maintenance, Repair, and Operations | ||||
Disaggregation of Revenue | ||||
Total Net Sales | 742.7 | 725.9 | 2,040.1 | 2,149.2 |
Property Improvement | ||||
Disaggregation of Revenue | ||||
Total Net Sales | $ 84.8 | $ 99.3 | $ 228.9 | $ 276.8 |
SUBSEQUENT EVENT (Details)
SUBSEQUENT EVENT (Details) $ / shares in Units, $ in Millions | Dec. 03, 2020lawsuit | Nov. 15, 2020USD ($)$ / shares | Nov. 01, 2020$ / shares | Feb. 02, 2020$ / shares |
Subsequent Event [Line Items] | ||||
Common stock, par value | $ 0.01 | $ 0.01 | ||
Subsequent Event | Merger Agreement | ||||
Subsequent Event [Line Items] | ||||
Common stock, par value | $ 0.01 | |||
Price per Share | $ 56 | |||
Number of lawsuits have been filed | lawsuit | 4 | |||
Subsequent Event | Parent | ||||
Subsequent Event [Line Items] | ||||
Termination fee in cash upon termination of the Merger Agreement | $ | $ 275 |