Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Oct. 01, 2022 | Nov. 23, 2022 | Apr. 02, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Amendment Flag | false | ||
Document Period End Date | Oct. 01, 2022 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | LESL | ||
Entity Registrant Name | LESLIE’S, INC. | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Central Index Key | 0001821806 | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Current Fiscal Year End Date | --10-01 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 3.7 | ||
Entity Common Stock, Shares Outstanding | 183,545,344 | ||
Entity Shell Company | false | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Document Transition Report | false | ||
Entity File Number | 001-39667 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 20-8397425 | ||
Entity Address, Address Line One | 2005 East Indian School Road | ||
Entity Address, City or Town | Phoenix | ||
Entity Address, State or Province | AZ | ||
Entity Address, Postal Zip Code | 85016 | ||
City Area Code | 602 | ||
Local Phone Number | 366-3999 | ||
Documents Incorporated by Reference | DOCUMENTS INCORPORATED BY REFERENCE The information required by Part III of this Report, to the extent not set forth herein, is incorporated herein by reference from the Registrant’s definitive proxy statement relating to the Annual Meeting of Shareholders to be held in 2023, which definitive proxy statement shall be filed with the Securities and Exchange Commission within 120 days after the end of the fiscal year to which this Annual Report on Form 10-K relates. | ||
Title of 12(b) Security | Common Stock, par value $0.001 per share | ||
Security Exchange Name | NASDAQ | ||
Auditor Name | Ernst & Young LLP | ||
Auditor Location | Phoenix, Arizona | ||
Auditor Firm ID | 42 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Oct. 01, 2022 | Oct. 02, 2021 |
Current assets | ||
Cash and cash equivalents | $ 112,293 | $ 343,498 |
Accounts and other receivables, net | 45,295 | 38,860 |
Inventories | 361,686 | 198,789 |
Prepaid expenses and other current assets | 23,104 | 20,564 |
Total current assets | 542,378 | 601,711 |
Property and equipment, net | 78,087 | 70,335 |
Operating lease right-of-use assets | 236,477 | 212,284 |
Goodwill and other intangibles, net | 213,701 | 129,020 |
Deferred tax assets | 1,268 | 3,734 |
Other assets | 37,720 | 25,148 |
Total assets | 1,109,631 | 1,042,232 |
Current liabilities | ||
Accounts payable and accrued expenses | 266,972 | 233,597 |
Operating lease liabilities | 60,373 | 61,071 |
Income taxes payable | 12,511 | 6,945 |
Current portion of long-term debt | 8,100 | 8,100 |
Total current liabilities | 347,956 | 309,713 |
Operating lease liabilities, noncurrent | 179,835 | 160,037 |
Long-term debt, net | 779,726 | 786,125 |
Other long-term liabilities | 65 | 3,915 |
Total liabilities | 1,307,582 | 1,259,790 |
Commitments and contingencies | ||
Stockholders’ deficit | ||
Common stock, $0.001 par value, 1,000,000,000 shares authorized and 183,480,545 and 189,821,011 issued and outstanding as of October 1, 2022 and October 2, 2021, respectively. | 183 | 190 |
Additional paid in capital | 89,934 | 204,711 |
Retained deficit | (288,068) | (422,459) |
Total stockholders’ deficit | (197,951) | (217,558) |
Total liabilities and stockholders’ deficit | $ 1,109,631 | $ 1,042,232 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Oct. 01, 2022 | Oct. 02, 2021 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 183,480,545 | 189,821,011 |
Common stock, shares outstanding | 183,480,545 | 189,821,011 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Income Statement [Abstract] | |||
Sales | $ 1,562,120 | $ 1,342,917 | $ 1,112,229 |
Cost of merchandise and services sold | 888,379 | 747,757 | 651,516 |
Gross profit | 673,741 | 595,160 | 460,713 |
Selling, general and administrative expenses | 434,987 | 386,075 | 314,338 |
Operating income | 238,754 | 209,085 | 146,375 |
Other expense: | |||
Interest expense | 30,240 | 34,410 | 84,098 |
Loss on debt extinguishment | 0 | 9,169 | 0 |
Other expenses, net | 397 | 2,377 | 1,089 |
Total other expense | 30,637 | 45,956 | 85,187 |
Income before taxes | 208,117 | 163,129 | 61,188 |
Income tax expense | 49,088 | 36,495 | 2,627 |
Net income | $ 159,029 | $ 126,634 | $ 58,561 |
Earnings per share: | |||
Basic | $ 0.86 | $ 0.68 | $ 0.37 |
Diluted | $ 0.85 | $ 0.67 | $ 0.37 |
Weighted average shares outstanding: | |||
Basic | 184,347 | 185,412 | 156,500 |
Diluted | 186,148 | 190,009 | 156,500 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT - USD ($) $ in Thousands | Total | Cumulative Effect Period of Adoption Adjustment | Common Stock | Additional Paid in Capital (Deficit) | Retained Deficit | Retained Deficit Cumulative Effect Period of Adoption Adjustment |
Beginning Balance at Sep. 28, 2019 | $ (887,357) | $ 12 | $ 157 | $ (279,848) | $ (607,666) | $ 12 |
Beginning Balance, Shares at Sep. 28, 2019 | 156,500,000 | |||||
Equity-based compensation | 1,785 | 1,785 | ||||
Net income | 58,561 | 58,561 | ||||
Ending Balance at Oct. 03, 2020 | (826,999) | $ 157 | (278,063) | (549,093) | ||
Ending Balance, Shares at Oct. 03, 2020 | 156,500,000 | |||||
Issuance of common stock upon initial public offering, net of offering costs | 458,587 | $ 30 | 458,557 | |||
Issuance of common stock upon initial public offering, net of offering costs, Shares | 30,000,000 | |||||
Issuance of common stock under the Plan, shares | 3,321,000 | |||||
Issuance of common stock under the Plan | 3 | $ 3 | ||||
Equity-based compensation | 24,217 | 24,217 | ||||
Net income | 126,634 | 126,634 | ||||
Ending Balance at Oct. 02, 2021 | (217,558) | $ 190 | 204,711 | (422,459) | ||
Ending Balance, Shares at Oct. 02, 2021 | 189,821,000 | |||||
Issuance of common stock under the Plan, shares | 1,160,000 | |||||
Issuance of common stock under the Plan | 1,378 | $ 1 | 1,377 | |||
Equity-based compensation | 11,346 | 11,346 | ||||
Repurchase and retirement of common stock, shares | (7,500,000) | |||||
Repurchase and retirement of common stock | (152,146) | $ (8) | (127,500) | (24,638) | ||
Net income | 159,029 | 159,029 | ||||
Ending Balance at Oct. 01, 2022 | $ (197,951) | $ 183 | $ 89,934 | $ (288,068) | ||
Ending Balance, Shares at Oct. 01, 2022 | 183,481,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Operating Activities | |||
Net income | $ 159,029 | $ 126,634 | $ 58,561 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 30,769 | 26,553 | 28,925 |
Equity-based compensation | 11,346 | 24,217 | 1,785 |
Amortization of deferred financing costs and debt discounts | 1,982 | 2,483 | 3,489 |
Provision for doubtful accounts | 1,186 | 2,105 | 577 |
Deferred income taxes | 2,466 | 2,848 | (7,823) |
Loss (gain) on disposition of assets | 466 | (1,606) | 785 |
Loss on debt extinguishment | 0 | 9,169 | 0 |
Changes in operating assets and liabilities: | |||
Accounts and other receivables | (7,621) | (9,484) | 1,813 |
Inventories | (143,147) | (47,787) | 1,762 |
Prepaid expenses and other current assets | (1,476) | 2,674 | (14,959) |
Other assets | (12,670) | (11,164) | (13,023) |
Accounts payable and accrued expenses | 23,841 | 35,756 | 38,065 |
Income taxes payable | 5,566 | 5,088 | (4,856) |
Operating lease assets and liabilities, net | (5,093) | 1,786 | 7,037 |
Net cash provided by operating activities | 66,644 | 169,272 | 102,138 |
Investing Activities | |||
Purchases of property and equipment | (31,726) | (28,931) | (20,630) |
Business acquisitions, net of cash acquired | (107,663) | (8,868) | (6,188) |
Proceeds from disposition of fixed assets | 408 | 2,444 | 7 |
Net cash used in investing activities | (138,981) | (35,355) | (26,811) |
Financing Activities | |||
Borrowings on Revolving Credit Facility | 45,000 | 0 | 238,750 |
Payments on Revolving Credit Facility | (45,000) | 0 | (238,750) |
Repayment of long term debt | (8,100) | (396,135) | (10,425) |
Issuance of long term debt | 0 | 907 | 0 |
Payment of deferred financing costs | 0 | (9,579) | 0 |
Proceeds from options exercised | 1,378 | 0 | 0 |
Repurchase and retirement of common stock | (152,146) | 0 | 0 |
Proceeds from issuance of common stock upon initial public offering, net | 0 | 458,587 | 0 |
Net cash (used in) provided by financing activities | (158,868) | 53,780 | (10,425) |
Net (decrease) increase in cash and cash equivalents | (231,205) | 187,697 | 64,902 |
Cash and cash equivalents, beginning of year | 343,498 | 155,801 | 90,899 |
Cash and cash equivalents, end of year | 112,293 | 343,498 | 155,801 |
Supplemental Information: | |||
Interest | 32,617 | 36,408 | 88,678 |
Income taxes, net of refunds received | $ 41,149 | $ 28,559 | $ 15,305 |
Business and Operations
Business and Operations | 12 Months Ended |
Oct. 01, 2022 | |
Accounting Policies [Abstract] | |
Business and Operations | Note 1—Business and Operations Leslie’s, Inc. (“Leslie’s,” “we,” “our,” “us,” “its,” or the “Company”) is the leading direct-to-consumer pool and spa care brand. We market and sell pool and spa supplies and related products and services, which primarily consist of maintenance items such as chemicals, equipment and parts, and cleaning accessories, as well as safety, recreational, and fitness-related products. We currently market our products through 990 Company-operated locations in 39 states and e-commerce websites. Initial Public Offering In November 2020, we completed an IPO of 30.0 million shares of common stock at a public offering price of $ 17.00 per share for net proceeds of $ 458.6 million, after deducting underwriting discounts and commissions of $ 45.0 million and offering costs of $ 6.3 million. We used the net proceeds from the IPO to repay the entire outstanding amount related to our $ 390.0 million senior unsecured notes. The remaining proceeds were used for working capital and general corporate purposes. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Oct. 01, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2—Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation We prepared the accompanying consolidated financial statements following GAAP. The financial statements include all normal and recurring adjustments that are necessary for a fair presentation of our financial position and operating results. The consolidated financial statements include the accounts of Leslie’s, Inc. and our subsidiaries. All significant intercompany accounts and transactions have been eliminated. All share and per share information included in the accompanying consolidated financial statements has been retroactively adjusted to reflect a 156,500-for-1 stock split which was effected on October 23, 2020. The par value of the common stock was not adjusted as the result of the stock split. Fiscal Periods We operate on a fiscal calendar that results in a fiscal year consisting of a 52- or 53-week period ending on the Saturday closest to September 30th. In a 52-week fiscal year, each quarter contains 13 weeks of operations; in a 53-week fiscal year, each of the first, second and third quarters includes 13 weeks of operations and the fourth quarter includes 14 weeks of operations. References to fiscal 2022, 2021, and 2020 refer to the 52 weeks ended October 1, 2022 and October 2, 2021, respectively, and 53 weeks ended October 3, 2020. Segment Reporting Our Chief Operating Decision Maker is our Chief Executive Officer, who reviews financial information presented on a consolidated basis for purposes of allocating resources and assessing performance. We operate all of our locations in the United States and offer consumers similar products, services, and methods of distribution through our retail locations and e-commerce websites. As a result, we have a single reportable segment. Seasonality Our business is highly seasonal. Sales and earnings are highest during our third and fourth fiscal quarters, being April through September, which represent the peak months of swimming pool use. Sales are substantially lower during our first and second fiscal quarters. Prior Period Reclassifications Reclassifications of certain immaterial prior period amounts have been made to conform to current period presentation. Use of Estimates Management is required to make certain estimates and assumptions during the preparation of the consolidated financial statements in accordance with GAAP. These estimates and assumptions impact the reported amount of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements. They also impact the reported amount of net income during any period. Actual results could differ from those estimates. Significant estimates underlying the accompanying consolidated financial statements include inventory reserves, lease assumptions, vendor rebate programs, our loyalty program, the determination of income taxes payable and deferred income taxes, sales returns reserve, self-insurance liabilities, the recoverability of intangible assets and goodwill, fair value of assets acquired in a business combination; and contingent consideration related to business combinations. Cash and Cash Equivalents Cash and cash equivalents include cash on hand, demand deposits, money market funds and credit and debit card transactions. Our cash balance at financial institutions may exceed the FDIC insurance coverage limit. We consider all investments with an original maturity of three months or less and money market funds to be cash equivalents. All credit card and debit card transactions that process in less than seven days are classified as cash and cash equivalents. Fair Value Measurements We use fair value measurements to record the fair value of certain assets and to estimate the fair value of financial instruments not recorded at fair value but required to be disclosed at fair value. To determine the fair value, we maximize the use of observable inputs and minimize the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use to value an asset or liability and are developed based on market data obtained from independent sources. Unobservable inputs are inputs based on assumptions about the factors market participants would use to value an asset or liability. The fair value hierarchy is as follows, of which the first two are considered observable and the last unobservable: • Level 1—Quoted prices in active markets for identical assets or liabilities. • Level 2—Inputs other than Level 1 that are observable for the asset or liability, either directly or indirectly, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data by correlation or other means. • Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Value is determined using pricing models, discounted cash flow methodologies, or similar techniques and also includes instruments for which the determination of fair value requires significant judgment or estimation. As of October 1, 2022 and October 2, 2021, we held no assets that were required to be measured at fair value on a recurring basis. There were no transfers between levels in the fair value hierarchy during fiscal 2022, 2021, and 2020, respectively. The fair value of our amended and restated term loan credit agreement (“Term Loan”) due in 2028 was determined to be $ 760.0 million and $ 802.9 million as of October 1, 2022 and October 2, 2021, respectively. These fair value estimates, determined to be Level 2, are subjective in nature and involve uncertainties and matters of judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect these estimates. The carrying amounts of cash, cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value due to the short-term maturity of these instruments. Vendor Rebates Many of our vendor arrangements provide for us to receive specified amounts of consideration when we achieve various measures. These measures generally relate to the volume level of purchases from our vendors. We generally account for vendor programs as a reduction of the prices of the vendor’s products and therefore a reduction of inventory until we sell the product, at which time we recognize such consideration as a reduction of cost of merchandise and services sold in our consolidated statements of operations. Accounts and other receivables include vendor rebate receivables o f $ 19.5 million a nd $ 20.2 million as of October 1, 2022 and October 2, 2021, respectively . Allowance for Doubtful Accounts Allowance for doubtful accounts is calculated based on historical experience, counterparty credit risk, consumer credit risk and application of the specific identification method. Inventories Inventories are stated at the lower of cost or market or net realizable value. We value inventory using the weighted-average cost method. We evaluate inventory for excess and obsolescence and record necessary reserves. We provide provisions for losses related to inventories based on historical purchase cost, selling price, margin, and current business trends. When an inventory item is sold or disposed, the associated reserve is released at that time. Business Combinations We account for business combinations using the acquisition method of accounting. This method requires that the purchase price of the acquisition be allocated to the assets acquired and liabilities assumed using the fair values determined by management as of the acquisition date. The excess of the purchase price over the amounts allocated to assets acquired and liabilities assumed is recorded as goodwill. We use our best estimates and assumptions as part of the purchase price allocation process to accurately value assets acquired and liabilities assumed as of the acquisition date. Our estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, we record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill to the extent we identify adjustments to the preliminary purchase price allocation. Upon the conclusion of the measurement period or final determination of the fair values of the assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded in our consolidated statements of operations. Our consolidated financial statements include the results of operations from the date of acquisition for each business combination. The consideration for an acquisition may include future payments that are contingent upon the occurrence of a particular event. We record a contingent consideration at fair value on the acquisition date. We estimate the fair values through valuation models that incorporate probability adjusted assumptions related to the achievement of the milestones and the likelihood of making related payments. The fair value is remeasured at each reporting date and changes in fair value are recorded in within SG&A in the consolidated statements of operations. Determining the fair value of the contingent consideration requires management to make assumptions and judgements. We expense all acquisition-related costs as incurred in SG&A expenses in our consolidated statements of operations. Property and Equipment, Net Property and equipment are stated at cost, less accumulated depreciation and amortization. Costs of normal maintenance and repairs are charged to expense as incurred. Major replacements or improvements of property and equipment are capitalized. When items are sold or otherwise disposed of, the cost and related accumulated depreciation or amortization are removed from the accounts, and any resulting gain or loss is included in our consolidated statements of operations. Depreciation and amortization are computed using the straight-line method. These charges are based on the following range of useful lives: Building and improvements 5 - 39 years Vehicles, machinery and equipment 3 - 10 years Office furniture, computers and software 3 - 7 years Leasehold improvements 5 - 10 years , not to exceed the lease life We evaluate our long-lived assets for potential impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. The evaluation for long-lived assets (asset group) is performed at the lowest level of identifiable cash flows, which, for location assets, is the individual location level. The assets of a physical location with indicators of impairment are evaluated for recoverability by comparing its undiscounted future cash flows with its carrying value. If the carrying value is greater than the undiscounted future cash flows, we then measure the asset’s fair value to determine whether an impairment loss should be recognized. If the resulting fair value is less than the carrying value, an impairment loss is recognized for the difference between the carrying value and the estimated fair value. There was no impairment charge in fiscal 2022 or 2021. The impairment charges for long-lived assets were not material to our consolidated financial statements in fiscal 2020. Impairment charges are recorded in SG&A in our consolidated statements of operations. Cloud Computing Arrangements From time-to-time, we enter into various agreements with unaffiliated third parties for assistance with technical development work related to our security-related software and systems and other ongoing projects. Expenditures for implementation, set-up, and other upfront costs incurred in a cloud computing arrangement that is hosted by the vendor are capitalized generally in the same manner as internal use software and are recorded as other assets in our consolidated balance sheets. Such costs are amortized over the life of the related cloud computing arrangement. As of October 1, 2022 and October 2, 2021, appro ximately $ 9.7 million an d $ 5.2 million associated with these agreements are included in prepaid expenses and other current assets in our consolidated balance sheets, respectively. In addition, as of October 1, 2022 and October 2, 2021, approximately $ 35.7 million a nd $ 23.1 million associated with these agreements are included in other assets in our consolidated balance sheets, respectively. Goodwill and Other Intangibles, Net Goodwill and intangible assets are recorded at their estimated fair values at the date of acquisition. We review goodwill and indefinite-lived intangible assets for impairment annually (in the fourth quarter) or more frequently if impairment indicators arise. Goodwill can be evaluated for impairment, at our option, by first performing a qualitative assessment to determine whether a quantitative goodwill test is necessary. If it is determined, based on qualitative factors, the fair value of the reporting unit may be more likely than not less than the carrying amount, a quantitative goodwill impairment test would be required. Additionally, we can elect to forgo a qualitative assessment and perform a quantitative test. The quantitative test is to identify if a potential impairment exists by comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of the reporting unit exceeds the fair value, an impairment loss is recognized in an amount equal to that excess, not to exceed the carrying amount of goodwill. If a quantitative test is performed, we would estimate the value considering the use of various valuation techniques which may use significant unobservable inputs, or Level 3 inputs, as defined by the fair value hierarchy. We include assumptions about sales growth, operating margins, discount rates and valuations multiples which consider our budgets, business plans, economic projections and marketplace data, and are believed to reflect market participant views which would exist in an exit transaction. Some of the inherent estimates and assumptions used in this analysis are outside the control of management, including cost of capital, tax rates and market EBITDA comparables. Finite-lived intangible assets are amortized to reflect the pattern of economic benefits consumed. We evaluate amortizable intangible assets for potential impairment whenever events or changes in circumstances indicate that the carrying amounts of the assets may not be fully recoverable. Intangible assets useful lives are reviewed annually. For our indefinite life intangible assets, a qualitative assessment can also be performed to determine whether the existence of events and circumstances indicates it is more likely than not the intangible asset is impaired. Similar to goodwill, we can also elect to forgo a qualitative test for indefinite life intangible assets and perform a quantitative test. Upon performing the quantitative test, if the carrying value of the intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. We evaluate whether certain trade names continue to have an indefinite life annually. After we made our assessments, it was determined that there was no impairment related to goodwill or other intangible assets during fiscal 2022, 2021, and 2020. Leases We enter into contractual arrangements for the utilization of certain non-owned assets which are evaluated as finance or operating leases upon commencement and are accounted for accordingly. Specifically, a contract is or contains a lease when (1) the contract contains an explicitly or implicitly identified asset and (2) we obtain substantially all of the economic benefits from the use of that underlying asset and direct how and for what purpose the asset is used during the term of the contract in exchange for consideration. We assess whether an arrangement is or contains a lease at inception of the contract. We lease certain retail locations, warehouse and distribution space, office space, equipment, and vehicles. A substantial majority of our leases have an initial lease term of five years , typically with the option to extend the lease for at least one additional five-year term. Some of our leases may include the option to terminate in less than five years. The lease term used to calculate the right-of-use asset and lease liability at commencement includes the impacts of options to extend or terminate the lease when it is reasonably certain that we will exercise that option. When determining whether it is reasonably certain that we will exercise an option at commencement, we consider various existing economic factors, including market conditions, real estate strategies, the nature, length, and terms of the agreement, as well as the uncertainty of the condition of leased equipment at the end of the lease term. Based on these considerations, we generally conclude that the exercise of renewal options would not be reasonably certain in calculating our operating lease liability at commencement. The discount rate used to calculate the present value of lease payments is the rate implicit in the lease, when readily determinable. As the rate implicit in the lease is rarely readily determinable, we use a secured incremental borrowing rate, which is updated on a periodic basis as the discount rate for the present value of lease payments. Real estate taxes, insurance, maintenance, and operating expenses applicable to the leased property are generally our obligations under our lease agreements. In instances where these payments are fixed, they are included in the measurement of our lease liabilities, and when variable, are excluded and recognized in the period in which the obligation for those payments is incurred. For variable payments dependent upon an index or rate, we apply the active index or rate as of the lease commencement date. Variable lease payments not based on an index or rate are not included in the measurement of our operating lease liabilities as they cannot be reasonably estimated and are recognized in the period in which the obligation for those payments is incurred. Leases that have a term of 12 months or less upon commencement are considered short-term in nature and as such are not included in the measurement of our operating lease right-of-use assets and operating lease liabilities on the consolidated balance sheets and are expensed on a straight-line basis over the lease term. In addition, we do separate lease and non-lease components (e.g., common area maintenance). Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Revenue Recognition Revenue is recognized when control of the promised goods or services is transferred to our customer, in an amount that reflects the consideration we expect to be entitled to in exchange for such goods or services. Revenue from merchandise sales at retail locations is recognized at the point of sale and revenue from services is recognized when the services are rendered. Revenue from e-commerce merchandise sales is recognized either at the time of pick-up at one of our locations or at the time of shipment, depending on the customer’s order designation. Revenue is recorded net of related discounts, loyalty point deferrals, and sales tax. Payment from retail customers is generally at the point of sale and payment terms for professional pool operators are based on our credit requirements and generally have terms of less than 60 days . When we receive payment from a consumer before the consumer has taken possession of the merchandise or the service has been performed, the amount received is recorded as deferred revenue or as a customer deposit until the sale or service is complete. Shipping and h andling are treated as costs to fulfill the contract and not a separate performance obligation. We estimate a liability for sales returns based on current sales levels and historical return trends. At each financial reporting date, we assess our estimates of expected returns, and a corresponding adjustment to cost of sales for our right to recover the goods returned by the customer, net of any expected recovery cost. Adjustments related to changes in return estimates were immaterial in all periods presented. Our loyalty program, Pool Perks TM , allows members to earn reward points based on their purchases. Once a loyalty member achieves a certain point level, the member earns an award that may be used on future purchases. Points are valid for 12 months from issuance. We defer revenue related to earned points that have not yet been redeemed. The amount of deferred revenue is based on the estimated standalone selling price of points earned by members and reduced by the percentage of points expected to be redeemed. The estimated redemption percentage is based on historical redemption trends, current trends, and other relevant factors. Revenue is recognized when the rewards are redeemed, expired, or based on estimated breakage. As of October 1, 2022 and October 2, 2021, deferred revenue related to the loyalty program was $ 4.6 million a nd $ 5.9 million, respectively, and is included in accounts payable and accrued expenses in our consolidated balance sheets. Cost of Merchandise and Services Sold Cost of merchandise and services sold reflects the direct cost of purchased merchandise, costs to package certain chemical products, including direct materials and labor, costs to provide services, including labor and materials, as well as distribution and occupancy costs. Distribution costs include warehousing and transportation expenses, including costs associated with third-party fulfillment centers. Occupancy costs include the rent, common area maintenance, real estate taxes, and depreciation and amortization costs of all retail locations . Selling, General and Administrative Expenses Our SG&A includes selling and operating expenses at our retail locations and corporate level general and administrative expenses. Selling and operating expenses at retail locations include payroll, bonus and benefit costs for personnel, supplies, and credit and debit card processing costs. Corporate expenses include payroll, bonus, and benefit costs for our corporate and field support functions, equity-based compensation, marketing and advertising, insurance, utilities, occupancy costs related to our corporate office facilities, professional services, and depreciation and amortization for all assets, except those related to our retail locations and distribution operations, which are included in cost of merchandise and services sold. Advertising We expense advertising costs as incurred. Advertising costs for fiscal 2022, 2021, and 2020 were approximately $ 38.0 million, $ 25.4 million, and $ 19.4 million, respectively. Income Taxes We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts and tax bases of existing assets and liabilities. Deferred tax assets, including the benefit of net operating loss and tax credit carryforwards, are evaluated based on the guidelines for realization and are reduced by a valuation allowance if it is deemed more likely than not that such assets will not be realized. We consider several factors in evaluating the realizability of our deferred tax assets, including the nature, frequency and severity of recent losses, the remaining years available for carryforwards, changes in tax laws, the future profitability of the operations in the jurisdiction, and tax planning strategies. Our judgments and estimates concerning realizability of deferred tax assets could change if any of the evaluation factors change, resulting in an increase or decrease to income tax expense in any period. The ultimate realization of deferred tax assets can be dependent upon the generation of future taxable income during the periods in which the associated temporary differences become deductible. On a quarterly basis, we evaluate whether it is more likely than not that our deferred tax assets will be realized in the future and conclude whether a valuation allowance must be established. We record a liability for uncertain tax positions to the extent a tax position taken or expected to be taken in a tax return does not meet certain recognition or measurement criteria. Considerable management judgment is necessary to assess the inherent uncertainties related to the interpretations of complex tax laws, regulations and taxing authority rulings. Our judgments and estimates may change as a result of the evaluation of new information, such as the outcome of tax audits or changes to or further interpretations of tax laws and regulations, resulting in an increase or decrease to income tax expense in any period. Interest and penalties accrued, if any, relating to uncertain tax positions will be recognized as a component of the income tax provision. We determined there were no material uncertain tax positions as of October 1, 2022 and October 2, 2021. Equity-Based Compensation Stock-based compensation expense is measured at grant date, based on the fair value of the award, and is recognized on a straight-line basis over the requisite service period for awards expected to vest. See Note 17—Equity-Based Compensation for further discussion. Self-Insurance Reserves We are self-insured for losses relating to workers’ compensation, general liability, and employee medical. Stop-loss coverage has been purchased to limit exposure to any material level of claims. Liabilities for self-insurance reserves are estimated based on independent actuarial estimates, which are based on historical information and assumptions about future events. We utilize various techniques, including analysis of historical trends and actuarial valuation methods, to estimate the cost to settle reported claims and claims incurred but not yet reported as of the balance sheet date. The actuarial valuation methods consider loss development factors, which include the development time frame and expected claim reporting and settlement patterns, and expected loss costs, which include the expected frequency and severity of claim activity. Earnings per Share Basic earnings per share is calculated by dividing net income by the weighted average number of shares outstanding during the period. Dilutive earnings per share is computed giving effect to all potentially dilutive shares, unless their effect is antidilutive. We apply the treasury stock method for dilutive share-based awards. Performance-based share-based awards are included in diluted shares only if the related performance conditions have been considered satisfied as of the end of the reporting period. Recent Accounting Pronouncements In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12, Income Taxes (“Topic 740”): Simplifying the Accounting for Income Taxes. ASU 2019-12 removes certain exceptions related to intraperiod tax allocations, foreign subsidiaries, and interim reporting that are present within existing GAAP rules. The ASU also provides updated guidance regarding the tax treatment of certain franchise taxes, goodwill and nontaxable entities, among other items. In addition, ASU 2019-12 clarifies that the effect of a change in tax laws or rates should be reflected in the annual effective tax rate computation during the interim period that includes the enactment date. We adopted ASU 2019-12 as of October 3, 2021, (as of the beginning of fiscal 2022) and its adoption did not have a material impact on our consolidated financial statements. In March 2020 and January 2021, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and ASU No. 2021-01, Reference Rate Reform (Topic 848): Scope, respectively. This collective guidance is in response to accounting concerns regarding contract modifications and hedge accounting because of impending rate reform associated with structural risks of interbank offered rates, and particularly, the risk of cessation of the London Inter-Bank Offer Rate (“LIBOR”) related to regulators in several jurisdictions around the world having undertaken reference rate reform initiatives to identify alternative reference rates. The guidance provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The guidance is effective upon issuance and may be applied through December 31, 2022. In anticipation of the adoption and based on management’s initial evaluation of the projected impact to our consolidated financial statements, we do not estimate there to be a material impact. In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (“Topic 805”): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which includes certain amendments to improve, simplify, and provide consistency for recognition and measurement of acquired contract assets and contract liabilities from revenue contracts in a business combination. The amendments require that an acquirer recognize and measure such contract assets and contract liabilities under Topic 606, Revenue from Contracts with Customers, as if it had originated the contracts. The amendments also allow for election of certain practical expedients, which are applied on an acquisition-by-acquisition basis. The ASU is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted, including for any interim period, and if so elected, the amendments are applied retrospectively for any acquisitions that occurred in the fiscal year of interim adoption. We adopted ASU 2021-08 during the second quarter of fiscal 2022, and its adoption did not have a material impact on our consolidated financial statements. |
Business Combinations
Business Combinations | 12 Months Ended |
Oct. 01, 2022 | |
Business Combinations [Abstract] | |
Business Combinations | Note 3—Business Combinations Our consolidated financial statements include the results of operations of these acquisitions from the date of acquisition. The total purchase consideration was allocated to the tangible and intangible assets acquired and the liabilities assumed at their estimated fair values as of each acquisition date, with the excess recorded to goodwill. The goodwill resulting from these acquisitions is expected to be deductible for income tax purposes. During the measurement periods, which will not exceed one year from each closing, we will continue to obtain information to assist us in finalizing the acquisition date fair values. Any qualifying changes to our preliminary estimates will be recorded as adjustments to the respective assets and liabilities, with any residual amounts allocated to goodwill. Fiscal 2022 Acquisitions In fiscal 2022, we acquired six businesses for an aggregate purchase price of $ 107.7 million, inclusive of contingent consideration of up $ 4.0 million if certain performance metrics are achieved within one to three years of the respective closing dates. These acquisitions expanded our pool and spa footprint and added 27 new retail locations as well as expanded our manufacturing capabilities. The following table sets forth the preliminary purchase price allocation of these acquisitions, net of immaterial measurement period adjustments, in the aggregate (in thousands). The purchase accounting for two of the six acquisitions is complete. Total Total purchase consideration, net of cash acquired $ 107,663 Fair value of assets acquired and liabilities assumed: Inventories 20,050 Finite-lived intangible assets 15,200 Other assets and liabilities, net 1,692 Total assets acquired, net of liabilities assumed 36,942 Goodwill $ 70,721 Fiscal 2021 Acquisitions In fiscal 2021, we acquired three businesses for an aggregate purchase price of $ 8.9 million. These acquisitions consisted of retailers of supplies and services for hot tubs and swim spas and added eight locations. During fiscal 2022, we recorded measurement period adjustments resultin g in an increase in goodwill of $ 1.7 million related to these acquisitions. The purchase accounting for these acquisitions is complete. |
Goodwill and Other Intangibles,
Goodwill and Other Intangibles, Net | 12 Months Ended |
Oct. 01, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangibles, Net | Note 4—Goodwill and Other Intangibles, Net Goodwill The following table details the changes in goodwill (in thousands): October 1, 2022 October 2, 2021 Balance at beginning of the year $ 101,114 $ 93,295 Acquisitions, net of measurement period adjustments 72,399 7,819 Balance at the end of the year $ 173,513 $ 101,114 Other Intangible Assets Other intangible assets consisted of the following as of October 1, 2022 (in thousands, except weighted average remaining useful life): Weighted Gross Accumulated Net Trade name and trademarks (finite life) 11.0 $ 24,440 $ ( 5,907 ) $ 18,533 Trade name and trademarks (indefinite life) Indefinite 9,350 — 9,350 Non-compete agreements 6.5 8,683 ( 7,379 ) 1,304 Consumer relationships 7.9 24,100 ( 13,339 ) 10,761 Other intangibles 6.2 6,620 ( 6,380 ) 240 Total $ 73,193 $ ( 33,005 ) $ 40,188 Other intangible assets consisted of the following as of October 2, 2021 (in thousands, except weighted average remaining useful life): Weighted Gross Accumulated Net Trade name and trademarks (finite life) 6.6 $ 5,940 $ ( 5,274 ) $ 666 Trade name and trademarks (indefinite life) Indefinite 17,750 — 17,750 Non-compete agreements 7.5 8,633 ( 7,123 ) 1,510 Consumer relationships 6.4 19,000 ( 11,688 ) 7,312 Other intangibles 7.0 6,620 ( 5,952 ) 668 Total $ 57,943 $ ( 30,037 ) $ 27,906 Other intangible assets consisted of the following as of October 3, 2020 (in thousands, except weighted average remaining useful life): Weighted Gross Accumulated Net Trade name and trademarks (finite life) 3.6 $ 5,540 $ ( 5,139 ) $ 401 Trade name and trademarks (indefinite life) Indefinite 17,750 — 17,750 Non-compete agreements 8.3 8,633 ( 6,872 ) 1,761 Consumer relationships 6.1 17,200 ( 10,118 ) 7,082 Other intangibles 7.4 6,584 ( 5,687 ) 897 Total $ 55,707 $ ( 27,816 ) $ 27,891 Amortization expense was $ 3.0 million, $ 2.2 million, and $ 2.6 million in fiscal 2022, 2021, and 2020, respectively. No impairment of goodwill or other intangible assets was recorded during fiscal 2022, 2021, and 2020. In the fourth quarter of fiscal 2022, an $ 8.4 million indefinite-lived trade name intangible asset was reclassified to a finite-lived intangible asset due to a change in the way the asset will be utilized in the future. Prior to reclassifying the trade name to a finite-lived intangible asset, the Company tested it for impairment and determined that the fair value of the asset exceeded the carrying value. This trade name was assigned a 10 -year estimated useful life and will be amortized over its useful life on a prospective basis. The following table summarizes the estimated future amortization expense related to finite-lived intangible assets on our consolidated balance sheet as of October 1, 2022 (in thousands): Amount 2023 $ 3,507 2024 2,868 2025 2,772 2026 2,525 2027 2,402 Thereafter 16,764 Total $ 30,838 |
Accounts and Other Receivables,
Accounts and Other Receivables, Net | 12 Months Ended |
Oct. 01, 2022 | |
Receivables [Abstract] | |
Accounts and Other Receivables, Net | Note 5—Accounts and Other Receivables, Net Accounts and other receivables, net consisted of the following (in thousands): October 1, 2022 October 2, 2021 Vendor and other rebates receivable $ 24,546 $ 23,222 Customer receivables 17,708 13,473 Other receivables 4,553 4,621 Allowance for doubtful accounts ( 1,512 ) ( 2,456 ) Total $ 45,295 $ 38,860 |
Inventories
Inventories | 12 Months Ended |
Oct. 01, 2022 | |
Inventory Disclosure [Abstract] | |
Inventories | Note 6—Inventories Inventories consisted of the following (in thousands): October 1, 2022 October 2, 2021 Raw materials $ 9,065 $ 4,244 Finished goods 352,621 194,545 Total $ 361,686 $ 198,789 Changes in inventory excess and obsolescence reserves were as follows (in thousands): Additions Deductions Balance at Beginning of Period Charged to Costs and Expenses Sale or Disposal of Inventories Balance at 2022 $ 5,856 $ 865 $ ( 850 ) $ 5,871 2021 $ 4,939 $ 1,993 $ ( 1,076 ) $ 5,856 2020 $ 3,622 $ 2,659 $ ( 1,342 ) $ 4,939 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Oct. 01, 2022 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Prepaid Expenses and Other Current Assets | Note 7—Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): October 1, 2022 October 2, 2021 Prepaid occupancy costs $ 2,139 $ 7,198 Prepaid sales tax 2,874 2,205 Prepaid other 2,493 2,283 Other current assets 15,598 8,878 Total $ 23,104 $ 20,564 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Oct. 01, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 8—Property and Equipment Property and equipment consist of the following (in thousands): October 1, 2022 October 2, 2021 Land $ 5,813 $ 5,813 Buildings and improvements 10,135 10,017 Vehicles, machinery and equipment 42,394 38,738 Leasehold improvements 187,876 171,281 Office furniture, computers and software 168,988 155,511 Construction in process 5,741 10,911 $ 420,947 $ 392,271 Less: accumulated depreciation and amortization ( 342,860 ) ( 321,936 ) Total $ 78,087 $ 70,335 Depreciation and amortization expense on property and equipment was $ 27.8 million, $ 26.6 million, and $ 28.9 million in fiscal 2022, 2021, and 2020, respectively. Construction in process primarily consisted of leasehold improvements related to new or remodeled locations where construction had not been completed by the end of the period and internal use software as of October 1, 2022 and October 2, 2021, respectively. Capitalized software additions placed into service were $ 6.5 million, $ 2.8 million, and $ 3.0 million in fiscal 2022, 2021, and 2020, respectively. Capitalized software accumulated amortization totaled approximately $ 20.9 million and $ 15.0 million as of October 1, 2022 and October 2, 2021, respectively. Capitalized software and development costs remaining to be amortized were approximately $ 7.6 million and $ 6.9 million as of October 1, 2022 and October 2, 2021, respectively. |
Accounts Payable and Accrued Ex
Accounts Payable and Accrued Expenses | 12 Months Ended |
Oct. 01, 2022 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Expenses | Note 9—Accounts Payable and Accrued Expenses Accounts payable and accrued expenses consisted of the following (in thousands): October 1, 2022 October 2, 2021 Accounts payable $ 156,456 $ 100,960 Accrued payroll and employee benefits 34,010 40,071 Customer deposits 13,250 19,861 Interest 342 4,898 Inventory related accruals 16,034 12,444 Loyalty and deferred revenue 5,541 6,685 Sales tax 9,130 13,975 Self-insurance reserves 9,280 7,679 Other accrued liabilities 22,929 27,024 Total $ 266,972 $ 233,597 As of October 1, 2022, October 2, 2021, and October 3, 2020, approx imately $ 1.1 million, $ 1.5 million, and $ 1.1 million of capital expenditures are included in other accrued liabilities, respectively. |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Oct. 01, 2022 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Note 10—Long-Term Debt Our long-term debt, net consisted of the following (in thousands, except interest rates): Effective (1) October 1, 2022 October 2, 2021 Term Loan—due on March 9, 2028 5.62 % (2) $ 797,850 $ 805,950 Revolving Credit Facility 1.25 % (3) — — Senior Unsecured Notes — — Total long-term debt 797,850 805,950 Less: current portion of long-term debt ( 8,100 ) ( 8,100 ) Less: unamortized discount ( 2,805 ) ( 3,285 ) Less: deferred financing charges ( 7,219 ) ( 8,440 ) Long-term debt, net $ 779,726 $ 786,125 (1) Effective interest rates as of October 1, 2022. (2) Carries interest at a specified margin over LIBOR between 2.50 % and 2.75 % with a minimum LIBOR of 0.50 %. (3) Carries interest at a specific margin between 0.25 % and 0.75 % with respect to Base Rate loans and between 1.25 % and 1.75 % with respect to Eurodollar Rate loans. Term Loan In March 2021, we entered into an amendment to our Term Loan. The amended Term Loan provides for an $ 810.0 million secured term loan facility with a maturity date of March 9, 2028 . Borrowings under the Term Loan have an initial applicable rate, at our option, of (i) 2.75 % for loans that are LIBOR loans and (ii) 1.75 % for loans that are ABR loans. The applicable rate of the Term Loan is based on our first lien leverage ratio as follows: (a) if the first lien leverage ratio is greater than 2.75 to 1.00 , the applicable rate will be 2.75 % for LIBOR loans and 1.75 % for ABR loans and (b) the first lien leverage ratio is less than or equal to 2.75 to 1.00 , the applicable rate will be 2.50 % for LIBOR loans and 1.50 % for ABR loans. For LIBOR loans, the loans will bear interest at the adjusted LIBOR rate plus the applicable rate, where the adjusted LIBOR rate will not be less than 0.50 %. As a result of the amendment during the fiscal year ended October 2, 2021, we recognized a $ 1.9 million loss on debt extinguishment on our consolidated statements of operations. Revolving Credit Facility In April 2021, we entered into Amendment No. 5 to our $ 200.0 million Revolving Credit Facility maturing on August 13, 2025 (the “Amendment”). The Amendment has (i) an applicable margin on Base Rate loans with a range of 0.25 % to 0.75 %, (ii) an applicable margin on Eurodollar Rate loans with a range of 1.25 % to 1.75 %, (iii) a LIBOR floor of 0 %, and (iv) a commitment fee rate of 0.25 %. We are also obligated to pay a commission on all outstanding letters of credit as well as customary administrative, issuance, fronting, amendment, payment, and negotiation fee s. As of October 1, 2022 and October 2, 2021, no amounts were outstanding under the Revolving Credit Facility. The amount available was reduced by $ 10.0 million and $ 9.2 m illion of existing standby letters of credit as of October 1, 2022 and October 2, 2021, respectively. Senior Unsecured Notes The senior unsecured notes principal of $ 390.0 million was paid in full on November 3, 2020, resulting in a loss on debt extinguishment of $ 7.3 million on our consolidated statements of operations for the fiscal year ended October 2, 2021. Interest Rate Cap Agreements In March 2017, we entered into interest rate cap agreements in order to manage the variability of cash flows related to a portion of our floating rate indebtedness. Pursuant to the agreements, we capped LIBOR at 3.00 % with respect to the aggregate notional amount of $ 750.0 million. In March 2021, our interest rate cap agreements expired. The fair value of our interest rate cap agreements was zero as of October 2, 2021, and we did no t recognize any gain or loss on our interest rate cap agreements in fiscal 2021. Representations and Covenants Substantially all of our assets are pledged as collateral to secure our indebtedness. The Term Loan and the Revolving Credit Facility do not require us to comply with any financial covenants. The Term Loan and the Revolving Credit Facility contain customary representations and warranties, covenants, and conditions to borrowing. No event of default occurred as of October 1, 2022 and October 2, 2021, respectively. Future Debt Maturities The following table summarizes the debt maturities and scheduled principal repayments of our indebtedness as of October 1, 2022 (in thousands): Amount 2023 $ 8,100 2024 6,075 2025 10,125 2026 8,100 2027 8,100 Thereafter 757,350 Total $ 797,850 |
Leases
Leases | 12 Months Ended |
Oct. 01, 2022 | |
Leases [Abstract] | |
Leases | Note 11—Leases Operating Leases We lease certain locations, office, distribution, and manufacturing facilities under operating leases that expire at various dates through December 2033 . We are obligated to make cash payments in connection with various lease obligations and purchase commitments. All of these obligations require cash payments to be made by us over varying periods of time. Certain leases are renewable at our option typically for periods of five or more years. Certain of these arrangements are cancelable on short notice and others require payments upon early termination. We do not have any finance leases. The following table summarizes the components of lease expense (in thousands): Year Ended October 1, 2022 October 2, 2021 October 3, 2020 Operating lease expense $ 72,922 $ 68,130 $ 66,642 Variable lease expense — 1,129 819 Total net lease expense $ 72,922 $ 69,259 $ 67,461 As of October 1, 2022 and October 2, 2021, operating lease right-of-use assets obtained in exchange for operating lease liabilities totaled $ 32.6 million and $ 9.7 million, respectively. The following table presents the weighted-average remaining lease term and discount rate for operating leases: October 1, 2022 October 2, 2021 Weighted-average remaining lease term 4.4 years 4.3 years Weighted-average discount rate 5.5 % 5.1 % The following table summarizes the future annual minimum lease payments as of October 1, 2022 (in thousands): Amount 2023 $ 71,851 2024 67,558 2025 51,216 2026 40,959 2027 22,844 Thereafter 17,863 Total $ 272,291 Less: amount of lease payments representing imputed interest 32,083 Present value of future minimum lease payments 240,208 Less: current operating lease liabilities 60,373 Operating lease liabilities, noncurrent $ 179,835 |
Income Taxes
Income Taxes | 12 Months Ended |
Oct. 01, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 12—Income Taxes The provision for income taxes consists of the following (in thousands): Year Ended October 1, 2022 October 2, 2021 October 1, 2020 Current: Federal $ 37,886 $ 25,914 $ 8,188 State 8,736 7,733 2,262 Total Current 46,622 33,647 10,450 Deferred: Federal 2,556 2,633 ( 5,844 ) State ( 90 ) 215 ( 1,979 ) Total Deferred 2,466 2,848 ( 7,823 ) Total income tax provision $ 49,088 $ 36,495 $ 2,627 A reconciliation of the provision for income taxes to the amount computed at the federal statutory rate is as follows (in thousands): Year Ended October 1, 2022 October 2, 2021 October 3, 2020 Federal income tax at statutory rate $ 43,705 $ 34,257 $ 12,851 Equity-based compensation ( 1,025 ) ( 2,360 ) 375 Section 162(m) limitation 805 2,826 — Permanent differences 96 564 89 Change in valuation allowance — ( 5,425 ) ( 11,373 ) State taxes, net of federal benefit 6,734 7,072 2,503 Other ( 1,227 ) ( 439 ) ( 1,818 ) Total income tax provision $ 49,088 $ 36,495 $ 2,627 Our effecti ve income tax rate for fiscal 2022 was 23.6 % as compared to 22.4 % in fiscal 2021. The tax effects of temporary differences that give rise to significant portions of deferred tax assets and liabilities are summarized below (in thousands): October 1, 2022 October 2, 2021 Deferred tax assets: Compensation accruals $ 4,067 $ 5,674 Inventories 3,496 — Lease liabilities 58,710 54,489 Equity-based compensation 2,151 1,646 Reserves and other accruals 1,059 1,138 Total deferred tax assets 69,483 62,947 Deferred tax liabilities: Property, plant, and equipment ( 4,066 ) ( 1,392 ) Intangibles ( 4,302 ) ( 3,849 ) Lease assets ( 57,798 ) ( 52,264 ) Deferred financing cost ( 310 ) ( 399 ) Other ( 1,739 ) ( 1,309 ) Total deferred tax liabilities ( 68,215 ) ( 59,213 ) Deferred tax assets (liabilities), net $ 1,268 $ 3,734 Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to utilize the existing deferred tax assets. The interest expense limitation passed in the CARES Act created a deferred tax asset for the fiscal year ended October 3, 2020 that we did not anticipate realizing in the immediate future; as a result, a valuation allowance was recorded. The $ 5.4 million valuation allowance was removed during the first quarter of fiscal 2021 as the realization of the CARES Act deferred tax asset was deemed probable due to the Company’s paydown of debt with proceeds from the IPO, which decreased interest expense. We are subject to United States federal and state taxes in the normal course of business and our income tax returns are subject to examination by the relevant tax authorities. We are no longer subject to United States federal examinations by taxing authorities for calendar years before 2018 and are no longer subject to state examinations for calendar years before 2017. We have not identified any material uncertain tax positions. In August 2022, the Inflation Reduction Act of 2022 was signed into law containing provisions effective January 1, 2023, including a 15 % corporate minimum tax and a 1 % excise tax on stock repurchases and several tax incentives to promote clean energy. The Company is evaluating the impact on future periods and at this time the Company does not expect it to have a material impact on its consolidated financial statements. |
Commitments & Contingencies
Commitments & Contingencies | 12 Months Ended |
Oct. 01, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments & Contingencies | Note 13—Commitments & Contingencies Contingencies We are defendants in lawsuits or potential claims encountered in the normal course of business. When the potential liability from a matter can be estimated and the loss is considered probable, we record the estimated loss. Due to uncertainties related to the resolution of lawsuits, investigations and claims, the ultimate outcome may differ from the estimates. We do not expect that the resolutions of any of these matters will have a material effect to our consolidated financial position or results of operations. We did not record any material loss contingencies as of October 1, 2022, October 2, 2021, and October 3, 2020. Our workers’ compensation insurance program, general liability insurance program, and employee group medical plan have self-insurance retention features of up to $ 0.4 million per event a s of October 1, 2022 and October 2, 2021. We had standby letters of credit outstanding in the amounts of $ 10.0 and $ 9.2 million as of October 1, 2022 and October 2, 2021, respectively, for the purpose of securing such obligations under our workers’ compensation self-insurance programs. Purchase Commitments In addition to our lease obligations, we maintain future purchase commitments related to inventory and operational requirements. The following table summarizes the future minimum purchase commitments as of October 1, 2022 (in thousands): Amount 2023 $ 4,143 2024 4,422 2025 3,366 2026 3,120 2027 1,339 Thereafter 260 Total $ 16,650 |
401(K) Plan
401(K) Plan | 12 Months Ended |
Oct. 01, 2022 | |
Retirement Benefits [Abstract] | |
401(K) Plan | Note 14—401(K) Plan We provide for the benefit of our employees a voluntary defined contribution retirement plan under Section 401(k) of the Internal Revenue Code. The plan covers all eligible employees and provides for a matching contribution by us of 50 % of each participant’s contribution of up to 4 % of the individual’s compensation as defined. The expenses related to this plan wer e $ 1.4 million, $ 0.8 million, and $ 1.1 million in fiscal 2022, 2021, and 2020, respectively. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Oct. 01, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 15—Related Party Transactions In February 2017, we entered into a management services agreement with our private equity sponsors in connection with our acquisition in February 2017. The management services agreement provided that we pay an annual fee for management and advisory services to us and our affiliates, including general management consulting services, support and analysis with respect to financing alternatives and strategic planning functions. The management services agreement terminated in October 2020 in connection with the completion of our IPO. During fiscal 2020, we paid or accrued management fees in the amount of $ 4.9 million. On December 14, 2021, the Company entered into a share repurchase agreement with Bubbles Investor Aggregator, L.P. and Explorer Investment Pte. Ltd. (together, the “Selling Stockholders”), each a greater than 5 % beneficial owner of the Company’s common stock, providing for the repurchase by the Company from the Selling Stockholders of an aggregate of 7.5 million shares of common stock, conditioned on the closing of a contemporaneous secondary public offering (the “Offering”). The price per share of repurchased common stock paid by the Company was $ 20.25 , which represents the per share price at which shares of common stock were sold to the public in the Offering less the underwriting discount. The repurchase transaction closed on December 16, 2021. See Note 16—Share Repurchase Program for detailed information regarding our share repurchase program. |
Share Repurchase Program
Share Repurchase Program | 12 Months Ended |
Oct. 01, 2022 | |
Equity [Abstract] | |
Share Repurchase Program | Note 16—Share Repurchase Program On December 3, 2021, the board of directors authorized a share repurchase program for up to an aggregate of $ 300 million of the Company’s outstanding shares of common stock over a period of three year s, expiring December 3, 2024 . The amount, price, manner, and timing of repurchases are determined by the Company in its discretion and depends on a number of factors, including legal requirements, price, economic and market conditions, the Company’s financial condition, capital requirements, cash flows, results of operations, future business prospects, and other factors our management may deem relevant. The share repurchase program may be amended, suspended, or discontinued at any time. Shares may be repurchased from time-to-time using a variety of methods, including on the open market and/or in privately negotiated transactions, including under plans complying with Rule 10b5-1 under the Exchange Act, as part of accelerated share repurchases, and other methods. On December 16, 2021, the Company repurchased and retired 7.5 million shares of common stock at a price per share of $ 20.25 under the program. The Company paid $ 151.9 million ($ 152.1 million including offering costs) to fund the share repurchase using existing cash on hand. The Company accounted for the share repurchase and retirement of shares under the cost method by deducting its par value from common stock, reducing additional paid-in-capital by $ 127.5 million (using the share price when the shares were originally issued), and increasing retained deficit by the remaining excess cost of $ 24.4 million. As of October 1, 2022, approximately $ 148 million remained available for future purchases under our share repurchase program. The following table presents information about our repurchases of common stock under our share repurchase program (in thousands): Year Ended October 1, 2022 October 2, 2021 Total number of shares repurchased 7,500 — Total amount paid for shares repurchased $ 151,875 $ — |
Equity-Based Compensation
Equity-Based Compensation | 12 Months Ended |
Oct. 01, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Equity-Based Compensation | Note 17—Equity-Based Compensation Equity-Based Compensation 2020 Omnibus Incentive Plan In October 2020, we adopted the Leslie’s, Inc. 2020 Omnibus Incentive Plan (the “Plan”). The Plan provides for the grant of awards such as non-qualified stock options to purchase Leslie’s common stock (each, a “Stock Option”) and restricted stock units (“RSUs”) which may settle in Leslie’s, Inc. common stock to our directors, executives and eligible employees of the Company. Stock Options granted under the Plan generally expire ten years from the date of grant and consist of Stock Options that vest upon the satisfaction of time-based requirements (“Service Stock Option”) and performance-based Stock Options that vest upon satisfaction of a performance-based requirement (“Performance Stock Options”). RSUs consist of grants that vest ratably upon the satisfaction of time-based requirements (“Service RSU”) and performance-based RSUs that vest upon satisfaction of performance-based requirements (“Performance RSU”). In each case, vesting of the Company’s outstanding and unvested Stock Options and RSUs is contingent upon the holder’s continued service through the date of each applicable vesting event. As of October 1, 2022, we had approximate ly 8.1 million shares of common stock available for future grants under the Plan. As of October 1, 2022, the aggregate unamortized value of all outstanding equity-based compensation awards was approximately $ 29.1 million, which is expected to be recognized over a weighted average period of approximately 2.5 years. Stock Options The fair value of each Stock Option granted is estimated on the grant date using the Black-Scholes option pricing model. The expected life is based on the SEC simplified method and a mid-point assumption. Expected price volatility is determined based on the implied volatilities of comparable companies over a historical period that matches the expected life of the Stock Options. The risk-free interest rate is based on the expected United States Treasury rate over the expected life. The dividend yield is based on the expectation that no dividends will be paid. During fiscal 2022, the Company did not grant any Stock Options. The following table summarizes the weighted average assumptions used for Stock Options granted during the year ended October 2, 2021: Expected volatility 28.9 % Risk-free interest rate 0.7 % Dividend yield 0.0 % Expected term (in years) 6.3 The following tables summarize our Stock Option activity under the Plan for the fiscal years ended (in thousands, except per share amounts): Year Ended October 1, 2022 October 2, 2021 Number of Options Weighted Average Number of Options Weighted Average Outstanding, Beginning 4,877 $ 18.22 — $ — Granted — — 5,372 18.43 Exercised ( 81 ) 17.00 — — Forfeited/Expired ( 1,016 ) 18.22 ( 495 ) 17.26 Balance, Ending 3,780 $ 18.24 4,877 $ 18.22 Vested and exercisable as of year-end 1,349 $ 18.28 — $ — As of October 1, 2022 Aggregate intrinsic value of Stock Options outstanding $ — Unamortized value of unvested Stock Options $ 9,477 Weighted average years that expense is expected to be recognized 1.8 Weighted average remaining contractual years outstanding 8.6 Restricted Stock Units The following table summarizes our RSU activity under the Plan for the fiscal years ended (in thousands, except per share amounts): Year Ended October 1, 2022 October 2, 2021 Number of RSUs Weighted Average Number of RSUs Weighted Average Outstanding, Beginning 3,135 $ 6.90 — $ — Converted from Incentive Awards (1) — — 6,038 1.43 Granted 631 18.57 725 25.95 Vested (2) ( 1,079 ) 5.99 ( 3,321 ) 1.10 Cancelled/forfeited ( 390 ) 9.82 ( 307 ) 4.64 Balance, Ending 2,297 $ 10.04 3,135 $ 6.90 (1) Represents approximately 4.8 million Service and Performance Incentive Awards converted to RSUs in connection with the IPO and adoption of the Plan during fiscal 2021. (2) RSUs that vested during the year ended October 2, 2021 inclu des RSUs that were issued in connection with the IPO that vest only upon achievement of volume weighted average price (“VWAP”) targets established by the compensation committee of the board of directors (Performance RSUs). The VWAP target was measured over rolling 20 -day trading periods commencing on the six-month anniversary of the consummation of the IPO. As of October 1, 2022 Unamortized value of unvested RSUs $ 19,622 Weighted average period (years) expense is expected to be recognized 2.8 During the fiscal year ended October 1, 2022, equity-based compensation expens e was $ 11.3 million . During the fiscal year ended October 2, 2021, equity-based compensation expense was $ 25.6 million and approximately $ 10.7 million associated with the acceleration of certain Incentive Awards in connection with the completion of our IPO. Equity-based compensation expense was $ 1.8 million during the fiscal year ended October 3, 2020. Equity-based compensation expense is reported in SG&A in our consolidated statements of operations. Incentive Grant Agreements Prior to the IPO, our then parent company granted profits interests to our employees (“Incentive Awards”) through incentive unit grant agreements (“Incentive Agreements”). The Incentive Awards had economic characteristics similar to Stock Options and had the right to share in the appreciation of the equity value of our then parent company. The sole asset of our then parent company was indirect ownership of Leslie’s, Inc. We concluded such Incentive Awards were classified as equity awards. The Incentive Awards were spread over two tiers, a service-based (time) award tier (“Service Incentive Awards”) and a performance-based award tier (“Performance Incentive Awards”). The Service Incentive Awards vested over a four-year period at a rate of 25 % annually on each anniversary of the date of grant. The Performance Incentive Awards vested based on performance conditions as defined in the Incentive Agreements. In connection with the IPO and adoption of the Plan, all Incentive Awards granted under Incentive Agreements were converted to RSUs under the Plan with substantially similar service and performance conditions as defined in the Incentive Agreements. The fair value of the Incentive Awards was estimated on the date of grant using the Black-Scholes option pricing model, which treated the Incentive Unit Grant Agreements as implicit call options with exercise prices determined based on their respective rights to participate in distributions. The Black-Scholes option pricing model required the use of a number of assumptions, including expected volatility, risk-free interest rate, expected dividends, and expected term. The following table summarizes the assumptions and fair value used for Incentive Awards for the fiscal year ended October 3, 2020: Expected volatility 23.5 % Risk-free interest rate 1.4 % Dividend yield 0.0 % Expected term (in years) 4.0 The following table summarizes our Incentive Awards activity for the fiscal year ended (in thousands, except per share amounts): October 2, 2021 October 3, 2020 Number of Awards Weighted Average Exercise Price Number of Awards Weighted Average Exercise Price Outstanding, Beginning 13,267 10,263 Cancelled upon IPO ( 8,450 ) — Converted to RSUs ( 4,817 ) — Granted — 5,980 $ 1.87 Cancelled/forfeited — ( 2,976 ) Balance, Ending — 13,267 |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Oct. 01, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 18—Earnings Per Share The following is a reconciliation of basic weighted average common shares outstanding to diluted weighted average common shares outstanding (in thousands, except per share amounts): Year Ended October 1, 2022 October 2, 2021 October 3, 2020 Numerator: Net income $ 159,029 $ 126,634 $ 58,561 Denominator: Weighted average shares outstanding - basic 184,347 185,412 156,500 Effect of dilutive securities: Stock Options — 567 — RSUs 1,801 4,030 — Weighted average shares outstanding - diluted 186,148 190,009 156,500 Basic earnings per share $ 0.86 $ 0.68 $ 0.37 Diluted earnings per share $ 0.85 $ 0.67 $ 0.37 The following number of weighted-average potentially dilutive shares were excluded from the calculation of diluted earnings per share because the effect of including such shares would have been antidilutive (in thousands): Year Ended October 1, 2022 October 2, 2021 (1) October 3, 2020 Stock Options 4,020 321 — RSUs 601 2 — Total 4,621 323 — (1) Excludes approximately 0.6 million Stock Options with performance conditions that have not yet been met or were not yet established as of October 2, 2021. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Oct. 01, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation We prepared the accompanying consolidated financial statements following GAAP. The financial statements include all normal and recurring adjustments that are necessary for a fair presentation of our financial position and operating results. The consolidated financial statements include the accounts of Leslie’s, Inc. and our subsidiaries. All significant intercompany accounts and transactions have been eliminated. All share and per share information included in the accompanying consolidated financial statements has been retroactively adjusted to reflect a 156,500-for-1 stock split which was effected on October 23, 2020. The par value of the common stock was not adjusted as the result of the stock split. |
Fiscal Periods | Fiscal Periods We operate on a fiscal calendar that results in a fiscal year consisting of a 52- or 53-week period ending on the Saturday closest to September 30th. In a 52-week fiscal year, each quarter contains 13 weeks of operations; in a 53-week fiscal year, each of the first, second and third quarters includes 13 weeks of operations and the fourth quarter includes 14 weeks of operations. References to fiscal 2022, 2021, and 2020 refer to the 52 weeks ended October 1, 2022 and October 2, 2021, respectively, and 53 weeks ended October 3, 2020. |
Segment Reporting | Segment Reporting Our Chief Operating Decision Maker is our Chief Executive Officer, who reviews financial information presented on a consolidated basis for purposes of allocating resources and assessing performance. We operate all of our locations in the United States and offer consumers similar products, services, and methods of distribution through our retail locations and e-commerce websites. As a result, we have a single reportable segment. |
Seasonality | Seasonality Our business is highly seasonal. Sales and earnings are highest during our third and fourth fiscal quarters, being April through September, which represent the peak months of swimming pool use. Sales are substantially lower during our first and second fiscal quarters. |
Prior Period Reclassifications | Prior Period Reclassifications Reclassifications of certain immaterial prior period amounts have been made to conform to current period presentation. |
Use of Estimates | Use of Estimates Management is required to make certain estimates and assumptions during the preparation of the consolidated financial statements in accordance with GAAP. These estimates and assumptions impact the reported amount of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements. They also impact the reported amount of net income during any period. Actual results could differ from those estimates. Significant estimates underlying the accompanying consolidated financial statements include inventory reserves, lease assumptions, vendor rebate programs, our loyalty program, the determination of income taxes payable and deferred income taxes, sales returns reserve, self-insurance liabilities, the recoverability of intangible assets and goodwill, fair value of assets acquired in a business combination; and contingent consideration related to business combinations. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include cash on hand, demand deposits, money market funds and credit and debit card transactions. Our cash balance at financial institutions may exceed the FDIC insurance coverage limit. We consider all investments with an original maturity of three months or less and money market funds to be cash equivalents. All credit card and debit card transactions that process in less than seven days are classified as cash and cash equivalents. |
Fair Value Measurements | Fair Value Measurements We use fair value measurements to record the fair value of certain assets and to estimate the fair value of financial instruments not recorded at fair value but required to be disclosed at fair value. To determine the fair value, we maximize the use of observable inputs and minimize the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use to value an asset or liability and are developed based on market data obtained from independent sources. Unobservable inputs are inputs based on assumptions about the factors market participants would use to value an asset or liability. The fair value hierarchy is as follows, of which the first two are considered observable and the last unobservable: • Level 1—Quoted prices in active markets for identical assets or liabilities. • Level 2—Inputs other than Level 1 that are observable for the asset or liability, either directly or indirectly, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data by correlation or other means. • Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Value is determined using pricing models, discounted cash flow methodologies, or similar techniques and also includes instruments for which the determination of fair value requires significant judgment or estimation. As of October 1, 2022 and October 2, 2021, we held no assets that were required to be measured at fair value on a recurring basis. There were no transfers between levels in the fair value hierarchy during fiscal 2022, 2021, and 2020, respectively. The fair value of our amended and restated term loan credit agreement (“Term Loan”) due in 2028 was determined to be $ 760.0 million and $ 802.9 million as of October 1, 2022 and October 2, 2021, respectively. These fair value estimates, determined to be Level 2, are subjective in nature and involve uncertainties and matters of judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect these estimates. The carrying amounts of cash, cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value due to the short-term maturity of these instruments. |
Vendor Rebates | Vendor Rebates Many of our vendor arrangements provide for us to receive specified amounts of consideration when we achieve various measures. These measures generally relate to the volume level of purchases from our vendors. We generally account for vendor programs as a reduction of the prices of the vendor’s products and therefore a reduction of inventory until we sell the product, at which time we recognize such consideration as a reduction of cost of merchandise and services sold in our consolidated statements of operations. Accounts and other receivables include vendor rebate receivables o f $ 19.5 million a nd $ 20.2 million as of October 1, 2022 and October 2, 2021, respectively |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts Allowance for doubtful accounts is calculated based on historical experience, counterparty credit risk, consumer credit risk and application of the specific identification method. |
Inventories | Inventories Inventories are stated at the lower of cost or market or net realizable value. We value inventory using the weighted-average cost method. We evaluate inventory for excess and obsolescence and record necessary reserves. We provide provisions for losses related to inventories based on historical purchase cost, selling price, margin, and current business trends. When an inventory item is sold or disposed, the associated reserve is released at that time. |
Business Combinations | Business Combinations We account for business combinations using the acquisition method of accounting. This method requires that the purchase price of the acquisition be allocated to the assets acquired and liabilities assumed using the fair values determined by management as of the acquisition date. The excess of the purchase price over the amounts allocated to assets acquired and liabilities assumed is recorded as goodwill. We use our best estimates and assumptions as part of the purchase price allocation process to accurately value assets acquired and liabilities assumed as of the acquisition date. Our estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, we record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill to the extent we identify adjustments to the preliminary purchase price allocation. Upon the conclusion of the measurement period or final determination of the fair values of the assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded in our consolidated statements of operations. Our consolidated financial statements include the results of operations from the date of acquisition for each business combination. The consideration for an acquisition may include future payments that are contingent upon the occurrence of a particular event. We record a contingent consideration at fair value on the acquisition date. We estimate the fair values through valuation models that incorporate probability adjusted assumptions related to the achievement of the milestones and the likelihood of making related payments. The fair value is remeasured at each reporting date and changes in fair value are recorded in within SG&A in the consolidated statements of operations. Determining the fair value of the contingent consideration requires management to make assumptions and judgements. We expense all acquisition-related costs as incurred in SG&A expenses in our consolidated statements of operations. |
Property and Equipment, Net | Property and Equipment, Net Property and equipment are stated at cost, less accumulated depreciation and amortization. Costs of normal maintenance and repairs are charged to expense as incurred. Major replacements or improvements of property and equipment are capitalized. When items are sold or otherwise disposed of, the cost and related accumulated depreciation or amortization are removed from the accounts, and any resulting gain or loss is included in our consolidated statements of operations. Depreciation and amortization are computed using the straight-line method. These charges are based on the following range of useful lives: Building and improvements 5 - 39 years Vehicles, machinery and equipment 3 - 10 years Office furniture, computers and software 3 - 7 years Leasehold improvements 5 - 10 years , not to exceed the lease life We evaluate our long-lived assets for potential impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. The evaluation for long-lived assets (asset group) is performed at the lowest level of identifiable cash flows, which, for location assets, is the individual location level. The assets of a physical location with indicators of impairment are evaluated for recoverability by comparing its undiscounted future cash flows with its carrying value. If the carrying value is greater than the undiscounted future cash flows, we then measure the asset’s fair value to determine whether an impairment loss should be recognized. If the resulting fair value is less than the carrying value, an impairment loss is recognized for the difference between the carrying value and the estimated fair value. There was no impairment charge in fiscal 2022 or 2021. The impairment charges for long-lived assets were not material to our consolidated financial statements in fiscal 2020. Impairment charges are recorded in SG&A in our consolidated statements of operations. |
Cloud Computing Arrangements | Cloud Computing Arrangements From time-to-time, we enter into various agreements with unaffiliated third parties for assistance with technical development work related to our security-related software and systems and other ongoing projects. Expenditures for implementation, set-up, and other upfront costs incurred in a cloud computing arrangement that is hosted by the vendor are capitalized generally in the same manner as internal use software and are recorded as other assets in our consolidated balance sheets. Such costs are amortized over the life of the related cloud computing arrangement. As of October 1, 2022 and October 2, 2021, appro ximately $ 9.7 million an d $ 5.2 million associated with these agreements are included in prepaid expenses and other current assets in our consolidated balance sheets, respectively. In addition, as of October 1, 2022 and October 2, 2021, approximately $ 35.7 million a nd $ 23.1 million associated with these agreements are included in other assets in our consolidated balance sheets, respectively. |
Goodwill and Other Intangibles, Net | Goodwill and Other Intangibles, Net Goodwill and intangible assets are recorded at their estimated fair values at the date of acquisition. We review goodwill and indefinite-lived intangible assets for impairment annually (in the fourth quarter) or more frequently if impairment indicators arise. Goodwill can be evaluated for impairment, at our option, by first performing a qualitative assessment to determine whether a quantitative goodwill test is necessary. If it is determined, based on qualitative factors, the fair value of the reporting unit may be more likely than not less than the carrying amount, a quantitative goodwill impairment test would be required. Additionally, we can elect to forgo a qualitative assessment and perform a quantitative test. The quantitative test is to identify if a potential impairment exists by comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of the reporting unit exceeds the fair value, an impairment loss is recognized in an amount equal to that excess, not to exceed the carrying amount of goodwill. If a quantitative test is performed, we would estimate the value considering the use of various valuation techniques which may use significant unobservable inputs, or Level 3 inputs, as defined by the fair value hierarchy. We include assumptions about sales growth, operating margins, discount rates and valuations multiples which consider our budgets, business plans, economic projections and marketplace data, and are believed to reflect market participant views which would exist in an exit transaction. Some of the inherent estimates and assumptions used in this analysis are outside the control of management, including cost of capital, tax rates and market EBITDA comparables. Finite-lived intangible assets are amortized to reflect the pattern of economic benefits consumed. We evaluate amortizable intangible assets for potential impairment whenever events or changes in circumstances indicate that the carrying amounts of the assets may not be fully recoverable. Intangible assets useful lives are reviewed annually. For our indefinite life intangible assets, a qualitative assessment can also be performed to determine whether the existence of events and circumstances indicates it is more likely than not the intangible asset is impaired. Similar to goodwill, we can also elect to forgo a qualitative test for indefinite life intangible assets and perform a quantitative test. Upon performing the quantitative test, if the carrying value of the intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. We evaluate whether certain trade names continue to have an indefinite life annually. After we made our assessments, it was determined that there was no impairment related to goodwill or other intangible assets during fiscal 2022, 2021, and 2020. |
Leases | Leases We enter into contractual arrangements for the utilization of certain non-owned assets which are evaluated as finance or operating leases upon commencement and are accounted for accordingly. Specifically, a contract is or contains a lease when (1) the contract contains an explicitly or implicitly identified asset and (2) we obtain substantially all of the economic benefits from the use of that underlying asset and direct how and for what purpose the asset is used during the term of the contract in exchange for consideration. We assess whether an arrangement is or contains a lease at inception of the contract. We lease certain retail locations, warehouse and distribution space, office space, equipment, and vehicles. A substantial majority of our leases have an initial lease term of five years , typically with the option to extend the lease for at least one additional five-year term. Some of our leases may include the option to terminate in less than five years. The lease term used to calculate the right-of-use asset and lease liability at commencement includes the impacts of options to extend or terminate the lease when it is reasonably certain that we will exercise that option. When determining whether it is reasonably certain that we will exercise an option at commencement, we consider various existing economic factors, including market conditions, real estate strategies, the nature, length, and terms of the agreement, as well as the uncertainty of the condition of leased equipment at the end of the lease term. Based on these considerations, we generally conclude that the exercise of renewal options would not be reasonably certain in calculating our operating lease liability at commencement. The discount rate used to calculate the present value of lease payments is the rate implicit in the lease, when readily determinable. As the rate implicit in the lease is rarely readily determinable, we use a secured incremental borrowing rate, which is updated on a periodic basis as the discount rate for the present value of lease payments. Real estate taxes, insurance, maintenance, and operating expenses applicable to the leased property are generally our obligations under our lease agreements. In instances where these payments are fixed, they are included in the measurement of our lease liabilities, and when variable, are excluded and recognized in the period in which the obligation for those payments is incurred. For variable payments dependent upon an index or rate, we apply the active index or rate as of the lease commencement date. Variable lease payments not based on an index or rate are not included in the measurement of our operating lease liabilities as they cannot be reasonably estimated and are recognized in the period in which the obligation for those payments is incurred. Leases that have a term of 12 months or less upon commencement are considered short-term in nature and as such are not included in the measurement of our operating lease right-of-use assets and operating lease liabilities on the consolidated balance sheets and are expensed on a straight-line basis over the lease term. In addition, we do separate lease and non-lease components (e.g., common area maintenance). Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. |
Revenue Recognition | Revenue Recognition Revenue is recognized when control of the promised goods or services is transferred to our customer, in an amount that reflects the consideration we expect to be entitled to in exchange for such goods or services. Revenue from merchandise sales at retail locations is recognized at the point of sale and revenue from services is recognized when the services are rendered. Revenue from e-commerce merchandise sales is recognized either at the time of pick-up at one of our locations or at the time of shipment, depending on the customer’s order designation. Revenue is recorded net of related discounts, loyalty point deferrals, and sales tax. Payment from retail customers is generally at the point of sale and payment terms for professional pool operators are based on our credit requirements and generally have terms of less than 60 days . When we receive payment from a consumer before the consumer has taken possession of the merchandise or the service has been performed, the amount received is recorded as deferred revenue or as a customer deposit until the sale or service is complete. Shipping and h andling are treated as costs to fulfill the contract and not a separate performance obligation. We estimate a liability for sales returns based on current sales levels and historical return trends. At each financial reporting date, we assess our estimates of expected returns, and a corresponding adjustment to cost of sales for our right to recover the goods returned by the customer, net of any expected recovery cost. Adjustments related to changes in return estimates were immaterial in all periods presented. Our loyalty program, Pool Perks TM , allows members to earn reward points based on their purchases. Once a loyalty member achieves a certain point level, the member earns an award that may be used on future purchases. Points are valid for 12 months from issuance. We defer revenue related to earned points that have not yet been redeemed. The amount of deferred revenue is based on the estimated standalone selling price of points earned by members and reduced by the percentage of points expected to be redeemed. The estimated redemption percentage is based on historical redemption trends, current trends, and other relevant factors. Revenue is recognized when the rewards are redeemed, expired, or based on estimated breakage. As of October 1, 2022 and October 2, 2021, deferred revenue related to the loyalty program was $ 4.6 million a nd $ 5.9 million, respectively, and is included in accounts payable and accrued expenses in our consolidated balance sheets. |
Cost of Merchandise and Services Sold | Cost of Merchandise and Services Sold Cost of merchandise and services sold reflects the direct cost of purchased merchandise, costs to package certain chemical products, including direct materials and labor, costs to provide services, including labor and materials, as well as distribution and occupancy costs. Distribution costs include warehousing and transportation expenses, including costs associated with third-party fulfillment centers. Occupancy costs include the rent, common area maintenance, real estate taxes, and depreciation and amortization costs of all retail locations . |
Selling, General and Administrative Expenses | Selling, General and Administrative Expenses Our SG&A includes selling and operating expenses at our retail locations and corporate level general and administrative expenses. Selling and operating expenses at retail locations include payroll, bonus and benefit costs for personnel, supplies, and credit and debit card processing costs. Corporate expenses include payroll, bonus, and benefit costs for our corporate and field support functions, equity-based compensation, marketing and advertising, insurance, utilities, occupancy costs related to our corporate office facilities, professional services, and depreciation and amortization for all assets, except those related to our retail locations and distribution operations, which are included in cost of merchandise and services sold. |
Advertising | Advertising We expense advertising costs as incurred. Advertising costs for fiscal 2022, 2021, and 2020 were approximately $ 38.0 million, $ 25.4 million, and $ 19.4 million, respectively. |
Income Taxes | Income Taxes We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts and tax bases of existing assets and liabilities. Deferred tax assets, including the benefit of net operating loss and tax credit carryforwards, are evaluated based on the guidelines for realization and are reduced by a valuation allowance if it is deemed more likely than not that such assets will not be realized. We consider several factors in evaluating the realizability of our deferred tax assets, including the nature, frequency and severity of recent losses, the remaining years available for carryforwards, changes in tax laws, the future profitability of the operations in the jurisdiction, and tax planning strategies. Our judgments and estimates concerning realizability of deferred tax assets could change if any of the evaluation factors change, resulting in an increase or decrease to income tax expense in any period. The ultimate realization of deferred tax assets can be dependent upon the generation of future taxable income during the periods in which the associated temporary differences become deductible. On a quarterly basis, we evaluate whether it is more likely than not that our deferred tax assets will be realized in the future and conclude whether a valuation allowance must be established. We record a liability for uncertain tax positions to the extent a tax position taken or expected to be taken in a tax return does not meet certain recognition or measurement criteria. Considerable management judgment is necessary to assess the inherent uncertainties related to the interpretations of complex tax laws, regulations and taxing authority rulings. Our judgments and estimates may change as a result of the evaluation of new information, such as the outcome of tax audits or changes to or further interpretations of tax laws and regulations, resulting in an increase or decrease to income tax expense in any period. Interest and penalties accrued, if any, relating to uncertain tax positions will be recognized as a component of the income tax provision. We determined there were no material uncertain tax positions as of October 1, 2022 and October 2, 2021. |
Equity-Based Compensation | Equity-Based Compensation Stock-based compensation expense is measured at grant date, based on the fair value of the award, and is recognized on a straight-line basis over the requisite service period for awards expected to vest. See Note 17—Equity-Based Compensation for further discussion. |
Self-Insurance Reserves | Self-Insurance Reserves We are self-insured for losses relating to workers’ compensation, general liability, and employee medical. Stop-loss coverage has been purchased to limit exposure to any material level of claims. Liabilities for self-insurance reserves are estimated based on independent actuarial estimates, which are based on historical information and assumptions about future events. We utilize various techniques, including analysis of historical trends and actuarial valuation methods, to estimate the cost to settle reported claims and claims incurred but not yet reported as of the balance sheet date. The actuarial valuation methods consider loss development factors, which include the development time frame and expected claim reporting and settlement patterns, and expected loss costs, which include the expected frequency and severity of claim activity. |
Earnings per Share | Earnings per Share Basic earnings per share is calculated by dividing net income by the weighted average number of shares outstanding during the period. Dilutive earnings per share is computed giving effect to all potentially dilutive shares, unless their effect is antidilutive. We apply the treasury stock method for dilutive share-based awards. Performance-based share-based awards are included in diluted shares only if the related performance conditions have been considered satisfied as of the end of the reporting period. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12, Income Taxes (“Topic 740”): Simplifying the Accounting for Income Taxes. ASU 2019-12 removes certain exceptions related to intraperiod tax allocations, foreign subsidiaries, and interim reporting that are present within existing GAAP rules. The ASU also provides updated guidance regarding the tax treatment of certain franchise taxes, goodwill and nontaxable entities, among other items. In addition, ASU 2019-12 clarifies that the effect of a change in tax laws or rates should be reflected in the annual effective tax rate computation during the interim period that includes the enactment date. We adopted ASU 2019-12 as of October 3, 2021, (as of the beginning of fiscal 2022) and its adoption did not have a material impact on our consolidated financial statements. In March 2020 and January 2021, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and ASU No. 2021-01, Reference Rate Reform (Topic 848): Scope, respectively. This collective guidance is in response to accounting concerns regarding contract modifications and hedge accounting because of impending rate reform associated with structural risks of interbank offered rates, and particularly, the risk of cessation of the London Inter-Bank Offer Rate (“LIBOR”) related to regulators in several jurisdictions around the world having undertaken reference rate reform initiatives to identify alternative reference rates. The guidance provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The guidance is effective upon issuance and may be applied through December 31, 2022. In anticipation of the adoption and based on management’s initial evaluation of the projected impact to our consolidated financial statements, we do not estimate there to be a material impact. In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (“Topic 805”): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which includes certain amendments to improve, simplify, and provide consistency for recognition and measurement of acquired contract assets and contract liabilities from revenue contracts in a business combination. The amendments require that an acquirer recognize and measure such contract assets and contract liabilities under Topic 606, Revenue from Contracts with Customers, as if it had originated the contracts. The amendments also allow for election of certain practical expedients, which are applied on an acquisition-by-acquisition basis. The ASU is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted, including for any interim period, and if so elected, the amendments are applied retrospectively for any acquisitions that occurred in the fiscal year of interim adoption. We adopted ASU 2021-08 during the second quarter of fiscal 2022, and its adoption did not have a material impact on our consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Useful Lives | Depreciation and amortization are computed using the straight-line method. These charges are based on the following range of useful lives: Building and improvements 5 - 39 years Vehicles, machinery and equipment 3 - 10 years Office furniture, computers and software 3 - 7 years Leasehold improvements 5 - 10 years , not to exceed the lease life |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Business Combinations [Abstract] | |
Schedule of Preliminary Allocation of Acquisitions, Net of Immaterial Measurement Period Adjustments in Aggregate | The following table sets forth the preliminary purchase price allocation of these acquisitions, net of immaterial measurement period adjustments, in the aggregate (in thousands). The purchase accounting for two of the six acquisitions is complete. Total Total purchase consideration, net of cash acquired $ 107,663 Fair value of assets acquired and liabilities assumed: Inventories 20,050 Finite-lived intangible assets 15,200 Other assets and liabilities, net 1,692 Total assets acquired, net of liabilities assumed 36,942 Goodwill $ 70,721 |
Goodwill and Other Intangible_2
Goodwill and Other Intangibles, Net (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Goodwill | The following table details the changes in goodwill (in thousands): October 1, 2022 October 2, 2021 Balance at beginning of the year $ 101,114 $ 93,295 Acquisitions, net of measurement period adjustments 72,399 7,819 Balance at the end of the year $ 173,513 $ 101,114 |
Summary of Other Intangible Assets | Other intangible assets consisted of the following as of October 1, 2022 (in thousands, except weighted average remaining useful life): Weighted Gross Accumulated Net Trade name and trademarks (finite life) 11.0 $ 24,440 $ ( 5,907 ) $ 18,533 Trade name and trademarks (indefinite life) Indefinite 9,350 — 9,350 Non-compete agreements 6.5 8,683 ( 7,379 ) 1,304 Consumer relationships 7.9 24,100 ( 13,339 ) 10,761 Other intangibles 6.2 6,620 ( 6,380 ) 240 Total $ 73,193 $ ( 33,005 ) $ 40,188 Other intangible assets consisted of the following as of October 2, 2021 (in thousands, except weighted average remaining useful life): Weighted Gross Accumulated Net Trade name and trademarks (finite life) 6.6 $ 5,940 $ ( 5,274 ) $ 666 Trade name and trademarks (indefinite life) Indefinite 17,750 — 17,750 Non-compete agreements 7.5 8,633 ( 7,123 ) 1,510 Consumer relationships 6.4 19,000 ( 11,688 ) 7,312 Other intangibles 7.0 6,620 ( 5,952 ) 668 Total $ 57,943 $ ( 30,037 ) $ 27,906 Other intangible assets consisted of the following as of October 3, 2020 (in thousands, except weighted average remaining useful life): Weighted Gross Accumulated Net Trade name and trademarks (finite life) 3.6 $ 5,540 $ ( 5,139 ) $ 401 Trade name and trademarks (indefinite life) Indefinite 17,750 — 17,750 Non-compete agreements 8.3 8,633 ( 6,872 ) 1,761 Consumer relationships 6.1 17,200 ( 10,118 ) 7,082 Other intangibles 7.4 6,584 ( 5,687 ) 897 Total $ 55,707 $ ( 27,816 ) $ 27,891 |
Summary of Estimated Future Amortization Expense Related to Finite-Lived Intangible Assets | The following table summarizes the estimated future amortization expense related to finite-lived intangible assets on our consolidated balance sheet as of October 1, 2022 (in thousands): Amount 2023 $ 3,507 2024 2,868 2025 2,772 2026 2,525 2027 2,402 Thereafter 16,764 Total $ 30,838 |
Accounts and Other Receivable_2
Accounts and Other Receivables, Net (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Receivables [Abstract] | |
Schedule of Accounts and Other Receivables, Net | Accounts and other receivables, net consisted of the following (in thousands): October 1, 2022 October 2, 2021 Vendor and other rebates receivable $ 24,546 $ 23,222 Customer receivables 17,708 13,473 Other receivables 4,553 4,621 Allowance for doubtful accounts ( 1,512 ) ( 2,456 ) Total $ 45,295 $ 38,860 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consisted of the following (in thousands): October 1, 2022 October 2, 2021 Raw materials $ 9,065 $ 4,244 Finished goods 352,621 194,545 Total $ 361,686 $ 198,789 |
Schedule of Changes in Inventory Excess and Obsolescence Reserves | Changes in inventory excess and obsolescence reserves were as follows (in thousands): Additions Deductions Balance at Beginning of Period Charged to Costs and Expenses Sale or Disposal of Inventories Balance at 2022 $ 5,856 $ 865 $ ( 850 ) $ 5,871 2021 $ 4,939 $ 1,993 $ ( 1,076 ) $ 5,856 2020 $ 3,622 $ 2,659 $ ( 1,342 ) $ 4,939 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following (in thousands): October 1, 2022 October 2, 2021 Prepaid occupancy costs $ 2,139 $ 7,198 Prepaid sales tax 2,874 2,205 Prepaid other 2,493 2,283 Other current assets 15,598 8,878 Total $ 23,104 $ 20,564 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Property, Plant and Equipment [Abstract] | |
Summary of Components of Property and Equipment | Property and equipment consist of the following (in thousands): October 1, 2022 October 2, 2021 Land $ 5,813 $ 5,813 Buildings and improvements 10,135 10,017 Vehicles, machinery and equipment 42,394 38,738 Leasehold improvements 187,876 171,281 Office furniture, computers and software 168,988 155,511 Construction in process 5,741 10,911 $ 420,947 $ 392,271 Less: accumulated depreciation and amortization ( 342,860 ) ( 321,936 ) Total $ 78,087 $ 70,335 |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Expenses (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Text Block [Abstract] | |
Schedule of Accounts Payable and Accrued Expenses | Accounts payable and accrued expenses consisted of the following (in thousands): October 1, 2022 October 2, 2021 Accounts payable $ 156,456 $ 100,960 Accrued payroll and employee benefits 34,010 40,071 Customer deposits 13,250 19,861 Interest 342 4,898 Inventory related accruals 16,034 12,444 Loyalty and deferred revenue 5,541 6,685 Sales tax 9,130 13,975 Self-insurance reserves 9,280 7,679 Other accrued liabilities 22,929 27,024 Total $ 266,972 $ 233,597 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Debt Disclosure [Abstract] | |
Summary of Long-Term Debt, Net | Our long-term debt, net consisted of the following (in thousands, except interest rates): Effective (1) October 1, 2022 October 2, 2021 Term Loan—due on March 9, 2028 5.62 % (2) $ 797,850 $ 805,950 Revolving Credit Facility 1.25 % (3) — — Senior Unsecured Notes — — Total long-term debt 797,850 805,950 Less: current portion of long-term debt ( 8,100 ) ( 8,100 ) Less: unamortized discount ( 2,805 ) ( 3,285 ) Less: deferred financing charges ( 7,219 ) ( 8,440 ) Long-term debt, net $ 779,726 $ 786,125 |
Schedule of Debt Maturities and Principal Repayments of Indebtedness | The following table summarizes the debt maturities and scheduled principal repayments of our indebtedness as of October 1, 2022 (in thousands): Amount 2023 $ 8,100 2024 6,075 2025 10,125 2026 8,100 2027 8,100 Thereafter 757,350 Total $ 797,850 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Leases [Abstract] | |
Summary of Components of Lease Expense | The following table summarizes the components of lease expense (in thousands): Year Ended October 1, 2022 October 2, 2021 October 3, 2020 Operating lease expense $ 72,922 $ 68,130 $ 66,642 Variable lease expense — 1,129 819 Total net lease expense $ 72,922 $ 69,259 $ 67,461 |
Schedule of Weighted-Average Remaining Lease Term and Discount Rate for Operating Leases | The following table presents the weighted-average remaining lease term and discount rate for operating leases: October 1, 2022 October 2, 2021 Weighted-average remaining lease term 4.4 years 4.3 years Weighted-average discount rate 5.5 % 5.1 % |
Schedule of Future Annual Minimum Lease Payments | The following table summarizes the future annual minimum lease payments as of October 1, 2022 (in thousands): Amount 2023 $ 71,851 2024 67,558 2025 51,216 2026 40,959 2027 22,844 Thereafter 17,863 Total $ 272,291 Less: amount of lease payments representing imputed interest 32,083 Present value of future minimum lease payments 240,208 Less: current operating lease liabilities 60,373 Operating lease liabilities, noncurrent $ 179,835 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Income Tax Disclosure [Abstract] | |
Summary of Provision for Income Taxes | The provision for income taxes consists of the following (in thousands): Year Ended October 1, 2022 October 2, 2021 October 1, 2020 Current: Federal $ 37,886 $ 25,914 $ 8,188 State 8,736 7,733 2,262 Total Current 46,622 33,647 10,450 Deferred: Federal 2,556 2,633 ( 5,844 ) State ( 90 ) 215 ( 1,979 ) Total Deferred 2,466 2,848 ( 7,823 ) Total income tax provision $ 49,088 $ 36,495 $ 2,627 |
Summary of Provision for Income Taxes to Amount Computed at Federal Statutory Rate | A reconciliation of the provision for income taxes to the amount computed at the federal statutory rate is as follows (in thousands): Year Ended October 1, 2022 October 2, 2021 October 3, 2020 Federal income tax at statutory rate $ 43,705 $ 34,257 $ 12,851 Equity-based compensation ( 1,025 ) ( 2,360 ) 375 Section 162(m) limitation 805 2,826 — Permanent differences 96 564 89 Change in valuation allowance — ( 5,425 ) ( 11,373 ) State taxes, net of federal benefit 6,734 7,072 2,503 Other ( 1,227 ) ( 439 ) ( 1,818 ) Total income tax provision $ 49,088 $ 36,495 $ 2,627 |
Summary of Deferred Tax Assets and Liabilities | The tax effects of temporary differences that give rise to significant portions of deferred tax assets and liabilities are summarized below (in thousands): October 1, 2022 October 2, 2021 Deferred tax assets: Compensation accruals $ 4,067 $ 5,674 Inventories 3,496 — Lease liabilities 58,710 54,489 Equity-based compensation 2,151 1,646 Reserves and other accruals 1,059 1,138 Total deferred tax assets 69,483 62,947 Deferred tax liabilities: Property, plant, and equipment ( 4,066 ) ( 1,392 ) Intangibles ( 4,302 ) ( 3,849 ) Lease assets ( 57,798 ) ( 52,264 ) Deferred financing cost ( 310 ) ( 399 ) Other ( 1,739 ) ( 1,309 ) Total deferred tax liabilities ( 68,215 ) ( 59,213 ) Deferred tax assets (liabilities), net $ 1,268 $ 3,734 |
Commitments & Contingencies (Ta
Commitments & Contingencies (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Future Minimum Purchase Commitments | The following table summarizes the future minimum purchase commitments as of October 1, 2022 (in thousands): Amount 2023 $ 4,143 2024 4,422 2025 3,366 2026 3,120 2027 1,339 Thereafter 260 Total $ 16,650 |
Share Repurchase Program (Table
Share Repurchase Program (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Equity [Abstract] | |
Schedule of Repurchases of Common Stock | The following table presents information about our repurchases of common stock under our share repurchase program (in thousands): Year Ended October 1, 2022 October 2, 2021 Total number of shares repurchased 7,500 — Total amount paid for shares repurchased $ 151,875 $ — |
Equity-Based Compensation (Tabl
Equity-Based Compensation (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Summary of Weighted Average Assumptions Used for Incentive Awards/ Stock Options | The following table summarizes the weighted average assumptions used for Stock Options granted during the year ended October 2, 2021: Expected volatility 28.9 % Risk-free interest rate 0.7 % Dividend yield 0.0 % Expected term (in years) 6.3 |
Summary of Incentive Awards/ Stock Options Activity | The following tables summarize our Stock Option activity under the Plan for the fiscal years ended (in thousands, except per share amounts): Year Ended October 1, 2022 October 2, 2021 Number of Options Weighted Average Number of Options Weighted Average Outstanding, Beginning 4,877 $ 18.22 — $ — Granted — — 5,372 18.43 Exercised ( 81 ) 17.00 — — Forfeited/Expired ( 1,016 ) 18.22 ( 495 ) 17.26 Balance, Ending 3,780 $ 18.24 4,877 $ 18.22 Vested and exercisable as of year-end 1,349 $ 18.28 — $ — As of October 1, 2022 Aggregate intrinsic value of Stock Options outstanding $ — Unamortized value of unvested Stock Options $ 9,477 Weighted average years that expense is expected to be recognized 1.8 Weighted average remaining contractual years outstanding 8.6 |
Summary of RSU Activity under Plan | The following table summarizes our RSU activity under the Plan for the fiscal years ended (in thousands, except per share amounts): Year Ended October 1, 2022 October 2, 2021 Number of RSUs Weighted Average Number of RSUs Weighted Average Outstanding, Beginning 3,135 $ 6.90 — $ — Converted from Incentive Awards (1) — — 6,038 1.43 Granted 631 18.57 725 25.95 Vested (2) ( 1,079 ) 5.99 ( 3,321 ) 1.10 Cancelled/forfeited ( 390 ) 9.82 ( 307 ) 4.64 Balance, Ending 2,297 $ 10.04 3,135 $ 6.90 (1) Represents approximately 4.8 million Service and Performance Incentive Awards converted to RSUs in connection with the IPO and adoption of the Plan during fiscal 2021. (2) RSUs that vested during the year ended October 2, 2021 inclu des RSUs that were issued in connection with the IPO that vest only upon achievement of volume weighted average price (“VWAP”) targets established by the compensation committee of the board of directors (Performance RSUs). The VWAP target was measured over rolling 20 -day trading periods commencing on the six-month anniversary of the consummation of the IPO. As of October 1, 2022 Unamortized value of unvested RSUs $ 19,622 Weighted average period (years) expense is expected to be recognized 2.8 |
Incentive Awards | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Summary of Weighted Average Assumptions Used for Incentive Awards/ Stock Options | The following table summarizes the assumptions and fair value used for Incentive Awards for the fiscal year ended October 3, 2020: Expected volatility 23.5 % Risk-free interest rate 1.4 % Dividend yield 0.0 % Expected term (in years) 4.0 |
Summary of Incentive Awards/ Stock Options Activity | The following table summarizes our Incentive Awards activity for the fiscal year ended (in thousands, except per share amounts): October 2, 2021 October 3, 2020 Number of Awards Weighted Average Exercise Price Number of Awards Weighted Average Exercise Price Outstanding, Beginning 13,267 10,263 Cancelled upon IPO ( 8,450 ) — Converted to RSUs ( 4,817 ) — Granted — 5,980 $ 1.87 Cancelled/forfeited — ( 2,976 ) Balance, Ending — 13,267 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Oct. 01, 2022 | |
Earnings Per Share [Abstract] | |
Summary of Reconciliation of Basic Weighted Average Common Shares Outstanding to Diluted Weighted Average Common Shares Outstanding | The following is a reconciliation of basic weighted average common shares outstanding to diluted weighted average common shares outstanding (in thousands, except per share amounts): Year Ended October 1, 2022 October 2, 2021 October 3, 2020 Numerator: Net income $ 159,029 $ 126,634 $ 58,561 Denominator: Weighted average shares outstanding - basic 184,347 185,412 156,500 Effect of dilutive securities: Stock Options — 567 — RSUs 1,801 4,030 — Weighted average shares outstanding - diluted 186,148 190,009 156,500 Basic earnings per share $ 0.86 $ 0.68 $ 0.37 Diluted earnings per share $ 0.85 $ 0.67 $ 0.37 |
Schedule of Antidilutive Securities Excluded from Calculation of Diluted Net Income Per Share | The following number of weighted-average potentially dilutive shares were excluded from the calculation of diluted earnings per share because the effect of including such shares would have been antidilutive (in thousands): Year Ended October 1, 2022 October 2, 2021 (1) October 3, 2020 Stock Options 4,020 321 — RSUs 601 2 — Total 4,621 323 — (1) Excludes approximately 0.6 million Stock Options with performance conditions that have not yet been met or were not yet established as of October 2, 2021. |
Business and Operations - Addit
Business and Operations - Additional Information (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Nov. 30, 2020 USD ($) $ / shares shares | Oct. 01, 2022 USD ($) State Location | Oct. 02, 2021 USD ($) | Oct. 03, 2020 USD ($) | |
Subsidiary, Sale of Stock [Line Items] | ||||
Number of company-operated locations | Location | 990 | |||
Number of states in which entity operates | State | 39 | |||
Net proceeds from initial public offering | $ 0 | $ 458,587 | $ 0 | |
Senior Unsecured Notes | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Repayment of senior notes | $ 390,000 | |||
IPO | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Number of common stock shares issued | shares | 30,000,000 | |||
Offering price | $ / shares | $ 17 | |||
Net proceeds from initial public offering | $ 458,600 | |||
Underwriting discounts and commissions | 45,000 | |||
Offering costs | $ 6,300 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Oct. 01, 2022 USD ($) Segment | Oct. 02, 2021 USD ($) | Oct. 03, 2020 USD ($) | |
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | |||
Number of reportable segment | Segment | 1 | ||
Stock split | 156,500-for-1 stock | ||
Vendor Rebate Receivables | $ 19,500 | $ 20,200 | |
Impairment charges related to goodwill or other indefinite lived intangible assets | 0 | 0 | $ 0 |
Impairment of long-lived assets | $ 0 | 0 | |
Leases initial term | 5 years | ||
Fair value transfer amount | $ 0 | 0 | 0 |
Advertising Expense | $ 38,000 | 25,400 | $ 19,400 |
Lease existence of option to extend [true false] | true | ||
Lease existence of option to terminate [true false] | true | ||
Lease option to extend | one additional five-year | ||
Leases option to terminate | Some of our leases may include the option to terminate in less than five years. | ||
Credit payment terms for commercial customers | 60 days | ||
Deferred revenue related to loyalty program | $ 4,600 | 5,900 | |
Cloud Computing Arrangements | Prepaid Expenses and Other Current Assets [Member] | |||
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | |||
Capitalized expenditures on cloud computing arrangement | 9,700 | 5,200 | |
Cloud Computing Arrangements | Other Assets [Member] | |||
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | |||
Capitalized expenditures on cloud computing arrangement | 35,700 | 23,100 | |
Level 2 | Term Loan due in 2028 | |||
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | |||
Fair value of term loan | $ 760,000 | $ 802,900 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Useful Lives (Details) | 12 Months Ended |
Oct. 01, 2022 | |
Building and Improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 39 years |
Building and Improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 5 years |
Vehicles, Machinery and Equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 10 years |
Vehicles, Machinery and Equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 3 years |
Office Furniture, Computers and Software | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 7 years |
Office Furniture, Computers and Software | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 3 years |
Leasehold Improvements | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 5-10 years, not to exceed the lease life |
Leasehold Improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 10 years |
Leasehold Improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 5 years |
Business Combinations - Additio
Business Combinations - Additional Information (Detail) $ in Thousands | 12 Months Ended | |||
Oct. 01, 2022 USD ($) | Oct. 01, 2022 USD ($) Number RetailLocation | Oct. 02, 2021 USD ($) Location Number | Oct. 03, 2020 USD ($) | |
Business Acquisition [Line Items] | ||||
Total purchase consideration, net of cash acquired | $ 107,663 | $ 107,663 | $ 8,868 | $ 6,188 |
2021 Acquisitions | ||||
Business Acquisition [Line Items] | ||||
Number of business acquired | Number | 3 | |||
Total purchase consideration, net of cash acquired | $ 8,900 | |||
2022 Acquisitions | ||||
Business Acquisition [Line Items] | ||||
Number of locations in which assets acquired | RetailLocation | 27 | |||
Number of business acquired | Number | 6 | |||
Total purchase consideration, net of cash acquired | $ 107,700 | |||
2022 Acquisitions | Contingent Consideration Two | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration | $ 4,000 | 4,000 | ||
Denver, Colorado, Medford, Oregon and Washington, DC | 2021 Acquisitions | ||||
Business Acquisition [Line Items] | ||||
Number of locations in which assets acquired | Location | 8 | |||
Accounting adjustments of increase in goodwill | $ 1,700 |
Business Combinations - Schedul
Business Combinations - Schedule of Preliminary Allocation of Acquisitions, Net of Immaterial Measurement Period Adjustments (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Oct. 01, 2022 | Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Business Combinations [Abstract] | ||||
Total purchase consideration, net of cash acquired | $ 107,663 | $ 107,663 | $ 8,868 | $ 6,188 |
Fair value of assets acquired and liabilities assumed: | ||||
Inventories | 20,050 | 20,050 | ||
Finite-lived intangible assets | 15,200 | 15,200 | ||
Other assets and liabilities, net | 1,692 | 1,692 | ||
Total assets acquired, net of liabilities assumed | 36,942 | 36,942 | ||
Goodwill | $ 70,721 | $ 72,399 | $ 7,819 |
Goodwill and Other Intangible_3
Goodwill and Other Intangibles, Net - Summary of Goodwill (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 01, 2022 | Oct. 02, 2021 | |
Goodwill [Roll Forward] | |||
Beginning Balance | $ 101,114 | $ 93,295 | |
Acquisitions, net of measurement period adjustments | $ 70,721 | 72,399 | 7,819 |
Ending Balance | $ 173,513 | $ 173,513 | $ 101,114 |
Goodwill and Other Intangible_4
Goodwill and Other Intangibles, Net - Summary of Other Intangible Assets (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Finite and Indefinite Lived Intangible Assets [Line Items] | |||
Net Carrying Amount, Finite Life | $ 30,838 | ||
Gross Carrying Value | 73,193 | $ 57,943 | $ 55,707 |
Accumulated Amortization | (33,005) | (30,037) | (27,816) |
Net Carrying Amount | $ 40,188 | $ 27,906 | $ 27,891 |
Trade Name and Trademarks | |||
Finite and Indefinite Lived Intangible Assets [Line Items] | |||
Weighted Average Remaining Useful Life, Finite Life | 11 years | 6 years 7 months 6 days | 3 years 7 months 6 days |
Gross Carrying Value, Finite Life | $ 24,440 | $ 5,940 | $ 5,540 |
Accumulated Amortization, Finite Life | (5,907) | (5,274) | (5,139) |
Net Carrying Amount, Finite Life | $ 18,533 | $ 666 | $ 401 |
Non-compete Agreements | |||
Finite and Indefinite Lived Intangible Assets [Line Items] | |||
Weighted Average Remaining Useful Life, Finite Life | 6 years 6 months | 7 years 6 months | 8 years 3 months 18 days |
Gross Carrying Value, Finite Life | $ 8,683 | $ 8,633 | $ 8,633 |
Accumulated Amortization, Finite Life | (7,379) | (7,123) | (6,872) |
Net Carrying Amount, Finite Life | $ 1,304 | $ 1,510 | $ 1,761 |
Consumer Relationships | |||
Finite and Indefinite Lived Intangible Assets [Line Items] | |||
Weighted Average Remaining Useful Life, Finite Life | 7 years 10 months 24 days | 6 years 4 months 24 days | 6 years 1 month 6 days |
Gross Carrying Value, Finite Life | $ 24,100 | $ 19,000 | $ 17,200 |
Accumulated Amortization, Finite Life | (13,339) | (11,688) | (10,118) |
Net Carrying Amount, Finite Life | $ 10,761 | $ 7,312 | $ 7,082 |
Other Intangibles | |||
Finite and Indefinite Lived Intangible Assets [Line Items] | |||
Weighted Average Remaining Useful Life, Finite Life | 6 years 2 months 12 days | 7 years | 7 years 4 months 24 days |
Gross Carrying Value, Finite Life | $ 6,620 | $ 6,620 | $ 6,584 |
Accumulated Amortization, Finite Life | (6,380) | (5,952) | (5,687) |
Net Carrying Amount, Finite Life | $ 240 | $ 668 | $ 897 |
Trade Name and Trademarks | |||
Finite and Indefinite Lived Intangible Assets [Line Items] | |||
Weighted Average Remaining Useful Life, Indefinite Life | Indefinite | Indefinite | Indefinite |
Net Carrying Amount, Indefinite Life | $ 9,350 | $ 17,750 | $ 17,750 |
Gross Carrying Value | $ 9,350 | $ 17,750 | $ 17,750 |
Goodwill and Other Intangible_5
Goodwill and Other Intangibles, Net - Additional Information (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Indefinite-Lived Intangible Assets [Line Items] | ||||
Amortization expense | $ 3,000,000 | $ 2,200,000 | $ 2,600,000 | |
Impairment of goodwill or other intangible assets | $ 0 | $ 0 | $ 0 | |
Change in estimated useful life | $ 8,400,000 | |||
Trade Names [Member] | ||||
Indefinite-Lived Intangible Assets [Line Items] | ||||
Weighted Average Remaining Useful Life, Finite Life | 10 years |
Goodwill and Other Intangible_6
Goodwill and Other Intangibles, Net - Summary of Estimated Future Amortization Expense Related to Finite-Lived Intangible Assets (Detail) $ in Thousands | Oct. 01, 2022 USD ($) |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
2023 | $ 3,507 |
2024 | 2,868 |
2025 | 2,772 |
2026 | 2,525 |
2027 | 2,402 |
Thereafter | 16,764 |
Net Carrying Amount, Finite Life | $ 30,838 |
Accounts and Other Receivable_3
Accounts and Other Receivables, Net - Schedule of Accounts and Other Receivables, Net - (Details) - USD ($) $ in Thousands | Oct. 01, 2022 | Oct. 02, 2021 |
Receivables [Abstract] | ||
Vendor and other rebates receivable | $ 24,546 | $ 23,222 |
Customer receivables | 17,708 | 13,473 |
Other receivables | 4,553 | 4,621 |
Allowance for doubtful accounts | (1,512) | (2,456) |
Total | $ 45,295 | $ 38,860 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Details) - USD ($) $ in Thousands | Oct. 01, 2022 | Oct. 02, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 9,065 | $ 4,244 |
Finished goods | 352,621 | 194,545 |
Total | $ 361,686 | $ 198,789 |
Inventories - Changes in Invent
Inventories - Changes in Inventory Excess and Obsolescence Reserves (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Inventory Adjustments [Abstract] | |||
Balance at Beginning of Period | $ 5,856 | $ 4,939 | $ 3,622 |
Charged to Costs and Expenses | 865 | 1,993 | 2,659 |
Sale or Disposal of Inventories | (850) | (1,076) | (1,342) |
Balance at End of Period | $ 5,871 | $ 5,856 | $ 4,939 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets - Schedule of Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Oct. 01, 2022 | Oct. 02, 2021 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Prepaid occupancy costs | $ 2,139 | $ 7,198 |
Prepaid sales tax | 2,874 | 2,205 |
Prepaid other | 2,493 | 2,283 |
Other current assets | 15,598 | 8,878 |
Total | $ 23,104 | $ 20,564 |
Property and Equipment - Summar
Property and Equipment - Summary of Components of Property and Equipment (Details) - USD ($) $ in Thousands | Oct. 01, 2022 | Oct. 02, 2021 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 420,947 | $ 392,271 |
Less: accumulated depreciation and amortization | (342,860) | (321,936) |
Total | 78,087 | 70,335 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 5,813 | 5,813 |
Buildings and Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 10,135 | 10,017 |
Vehicles, Machinery and Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 42,394 | 38,738 |
Leasehold Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 187,876 | 171,281 |
Office Furniture, Computers and Software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 168,988 | 155,511 |
Construction in Process | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 5,741 | $ 10,911 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation and amortization expense | $ 27.8 | $ 26.6 | $ 28.9 |
Capitalized software additions | 6.5 | 2.8 | $ 3 |
Capitalized software accumulated amortization | 20.9 | 15 | |
Capitalized software and development costs remaining to be amortized | $ 7.6 | $ 6.9 |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Expenses- Schedule of Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands | Oct. 01, 2022 | Oct. 02, 2021 |
Payables and Accruals [Abstract] | ||
Accounts payable | $ 156,456 | $ 100,960 |
Accrued payroll and employee benefits | 34,010 | 40,071 |
Customer deposits | 13,250 | 19,861 |
Interest | 342 | 4,898 |
Inventory related accruals | 16,034 | 12,444 |
Loyalty and deferred revenue | 5,541 | 6,685 |
Sales tax | 9,130 | 13,975 |
Self-insurance reserves | 9,280 | 7,679 |
Other accrued liabilities | 22,929 | 27,024 |
Total | $ 266,972 | $ 233,597 |
Accounts Payable and Accrued _4
Accounts Payable and Accrued Expenses (Additional Information) (Details) - USD ($) $ in Millions | Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 |
Payables and Accruals [Abstract] | |||
Capital expenditures included in other accrued liabilities | $ 1.1 | $ 1.5 | $ 1.1 |
Long-Term Debt - Summary of Deb
Long-Term Debt - Summary of Debt Obligations (Details) - USD ($) $ in Thousands | Oct. 01, 2022 | Oct. 02, 2021 | |
Debt Instrument [Line Items] | |||
Total long-term debt | $ 797,850 | $ 805,950 | |
Less: current portion of long-term debt | (8,100) | (8,100) | |
Less: unamortized discount | (2,805) | (3,285) | |
Less: deferred financing charges | (7,219) | (8,440) | |
Long-term debt, net | 779,726 | 786,125 | |
Revolving Credit Facility [Member] | |||
Debt Instrument [Line Items] | |||
Total long-term debt | $ 0 | 0 | |
Effective Interest Rate | [1] | 1.25% | |
Term Loan Due on March 9, 2028 | |||
Debt Instrument [Line Items] | |||
Total long-term debt | $ 797,850 | 805,950 | |
Effective Interest Rate | [2] | 5.62% | |
Senior Unsecured Notes | |||
Debt Instrument [Line Items] | |||
Total long-term debt | $ 0 | $ 0 | |
[1] Carries interest at a specific margin between 0.25 % and 0.75 % with respect to Base Rate loans and between 1.25 % and 1.75 % with respect to Eurodollar Rate loans. Carries interest at a specified margin over LIBOR between 2.50 % and 2.75 % with a minimum LIBOR of 0.50 %. |
Long-Term Debt - Summary of D_2
Long-Term Debt - Summary of Debt Obligations (Parenthetical) (Details) | 12 Months Ended |
Oct. 01, 2022 | |
LIBOR | Term Loan Due on March 9, 2028 | Maximum | |
Debt Instrument [Line Items] | |
Interest rate range | 2.75% |
LIBOR | Term Loan Due on March 9, 2028 | Minimum | |
Debt Instrument [Line Items] | |
Interest rate | 0.50% |
Interest rate range | 2.50% |
ABL Credit Facility | Base Rate | Maximum | |
Debt Instrument [Line Items] | |
Interest rate | 0.75% |
ABL Credit Facility | Base Rate | Minimum | |
Debt Instrument [Line Items] | |
Interest rate | 0.25% |
ABL Credit Facility | Eurodollar | Maximum | |
Debt Instrument [Line Items] | |
Interest rate | 1.75% |
ABL Credit Facility | Eurodollar | Minimum | |
Debt Instrument [Line Items] | |
Interest rate | 1.25% |
Long Term Debt - Term Loan - Ad
Long Term Debt - Term Loan - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Debt Instrument [Line Items] | ||||
Secured term loan facility | $ 797,850 | $ 805,950 | ||
Loss on early debt extinguishment | $ 0 | 9,169 | $ 0 | |
Term Loan | ||||
Debt Instrument [Line Items] | ||||
Secured term loan facility | $ 810,000 | |||
Debt instrument, maturity date | Mar. 09, 2028 | |||
Loss on early debt extinguishment | $ (1,900) | |||
Term Loan | Minimum | First Lien Leverage Ratio Greater Than 2.75 to 100 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 1% | |||
Term Loan | Minimum | First Lien Leverage Ratio Less Than or Equal to 2.75 to 1.00 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 1% | |||
Term Loan | Maximum | First Lien Leverage Ratio Greater Than 2.75 to 100 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 2.75% | |||
Term Loan | Maximum | First Lien Leverage Ratio Less Than or Equal to 2.75 to 1.00 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 2.75% | |||
Term Loan | LIBOR | Applicable Rate | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 2.75% | |||
Term Loan | LIBOR | First Lien Leverage Ratio Greater Than 2.75 to 100 | Applicable Rate | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 2.75% | |||
Term Loan | LIBOR | First Lien Leverage Ratio Less Than or Equal to 2.75 to 1.00 | Applicable Rate | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 2.50% | |||
Term Loan | LIBOR | Maximum | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 0.50% | |||
Term Loan | ABR | Applicable Rate | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 1.75% | |||
Term Loan | ABR | First Lien Leverage Ratio Greater Than 2.75 to 100 | Applicable Rate | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 1.75% | |||
Term Loan | ABR | First Lien Leverage Ratio Less Than or Equal to 2.75 to 1.00 | Applicable Rate | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 1.50% |
Long Term Debt - Revolving Cred
Long Term Debt - Revolving Credit Facility - Additional Information (Details) - Revolving Credit Facility [Member] - USD ($) | 1 Months Ended | ||
Apr. 30, 2021 | Oct. 01, 2022 | Oct. 02, 2021 | |
Debt Instrument [Line Items] | |||
Debt instrument, maturity date | Aug. 13, 2025 | ||
Credit facility, current borrowing capacity | $ 0 | $ 0 | |
Credit facility, maximum borrowing capacity | $ 200,000,000 | ||
Credit facility, commitment fee percentage | 0.25% | ||
Standby Letter of Credit | |||
Debt Instrument [Line Items] | |||
Amount of Letters of credit on credit facility | $ 10,000,000 | $ 9,200,000 | |
Base Rate | Minimum | |||
Debt Instrument [Line Items] | |||
Interest rate | 0.25% | ||
Base Rate | Maximum | |||
Debt Instrument [Line Items] | |||
Interest rate | 0.75% | ||
Eurodollar | Minimum | |||
Debt Instrument [Line Items] | |||
Interest rate | 1.25% | ||
Eurodollar | Maximum | |||
Debt Instrument [Line Items] | |||
Interest rate | 1.75% | ||
LIBOR | |||
Debt Instrument [Line Items] | |||
Interest rate | 0% |
Long Term Debt - Senior Unsecur
Long Term Debt - Senior Unsecured Notes - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | Nov. 03, 2020 | |
Debt Instrument [Line Items] | ||||
Loss on debt extinguishment | $ 0 | $ 9,169,000 | $ 0 | |
Senior Unsecured Notes | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, principal amount | $ 390,000,000 | |||
Loss on debt extinguishment | $ (7,300,000) |
Long Term Debt - Interest Rate
Long Term Debt - Interest Rate Cap Agreements - Additional Information (Details) - Interest Rate Cap Agreement - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 02, 2021 | Mar. 31, 2017 | |
Debt Instrument [Line Items] | |||
Aggregate notional amount | $ 750,000 | ||
Debt instrument, description of variable rate basis | LIBOR | ||
Fair value of interest rate cap agreements | $ 0 | ||
Gain (loss) of interest rate cap agreements | $ 0 | ||
LIBOR | |||
Debt Instrument [Line Items] | |||
Cap interest rate | 3% |
Long Term Debt - Schedule of De
Long Term Debt - Schedule of Debt Maturities and Principal Repayments of Indebtedness (Details) - USD ($) $ in Thousands | Oct. 01, 2022 | Oct. 02, 2021 |
Long-Term Debt, Fiscal Year Maturity [Abstract] | ||
2023 | $ 8,100 | |
2024 | 6,075 | |
2025 | 10,125 | |
2026 | 8,100 | |
2027 | 8,100 | |
Thereafter | 757,350 | |
Total long-term debt | $ 797,850 | $ 805,950 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Oct. 01, 2022 | Oct. 02, 2021 | |
Lessee Lease Description [Line Items] | ||
Lease expiration date | 2033-12 | |
Operating lease right-of-use assets obtained in exchange for operating lease liabilities | $ 32.6 | $ 9.7 |
Minimum | ||
Lessee Lease Description [Line Items] | ||
Operating lease renewal period | 5 years |
Leases - Summary of Components
Leases - Summary of Components of Lease Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Leases [Abstract] | |||
Operating lease expense | $ 72,922 | $ 68,130 | $ 66,642 |
Variable lease expense | 0 | 1,129 | 819 |
Total net lease expense | $ 72,922 | $ 69,259 | $ 67,461 |
Leases - Schedule of Weighted-A
Leases - Schedule of Weighted-Average Remaining Lease Term and Discount Rate for Operating Leases (Details) | Oct. 01, 2022 | Oct. 02, 2021 |
Leases [Abstract] | ||
Weighted-average remaining lease term | 4 years 4 months 24 days | 4 years 3 months 18 days |
Weighted-average discount rate | 5.50% | 5.10% |
Leases - Schedule of Future Ann
Leases - Schedule of Future Annual Minimum Lease Payments (Details) - USD ($) $ in Thousands | Oct. 01, 2022 | Oct. 02, 2021 |
Lessee, Operating Lease, Liability, to be Paid [Abstract] | ||
2023 | $ 71,851 | |
2024 | 67,558 | |
2025 | 51,216 | |
2026 | 40,959 | |
2027 | 22,844 | |
Thereafter | 17,863 | |
Total | 272,291 | |
Less: amount of lease payments representing imputed interest | 32,083 | |
Present value of future minimum lease payments | 240,208 | |
Less: current operating lease liabilities | 60,373 | $ 61,071 |
Operating lease liabilities, noncurrent | $ 179,835 | $ 160,037 |
Income Taxes - Summary of Provi
Income Taxes - Summary of Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Current: | |||
Federal | $ 37,886 | $ 25,914 | $ 8,188 |
State | 8,736 | 7,733 | 2,262 |
Total Current | 46,622 | 33,647 | 10,450 |
Deferred: | |||
Federal | 2,556 | 2,633 | (5,844) |
State | (90) | 215 | (1,979) |
Total Deferred | 2,466 | 2,848 | (7,823) |
Total income tax provision | $ 49,088 | $ 36,495 | $ 2,627 |
Income Taxes - Summary of Pro_2
Income Taxes - Summary of Provision for Income Taxes to Amount Computed at Federal Statutory Rate (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Income Tax Disclosure [Abstract] | |||
Federal income tax at statutory rate | $ 43,705 | $ 34,257 | $ 12,851 |
Equity-based compensation | (1,025) | (2,360) | 375 |
Section 162(m) limitation | 805 | 2,826 | 0 |
Permanent differences | 96 | 564 | 89 |
Change in valuation allowance | 0 | (5,425) | (11,373) |
State taxes, net of federal benefit | 6,734 | 7,072 | 2,503 |
Other | (1,227) | (439) | (1,818) |
Total income tax provision | $ 49,088 | $ 36,495 | $ 2,627 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Aug. 31, 2022 | Oct. 01, 2022 | Oct. 02, 2021 | Jan. 02, 2021 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 23.60% | 22.40% | ||
Valuation allowance | $ 5.4 | |||
Corporate minimum tax rate | 15% | |||
Excise tax rate | 1% |
Income Taxes - Summary of Defer
Income Taxes - Summary of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Oct. 01, 2022 | Oct. 02, 2021 |
Deferred tax assets: | ||
Compensation accruals | $ 4,067 | $ 5,674 |
Inventories | 3,496 | 0 |
Lease liabilities | 58,710 | 54,489 |
Equity-based compensation | 2,151 | 1,646 |
Reserves and other accruals | 1,059 | 1,138 |
Total deferred tax assets | 69,483 | 62,947 |
Deferred tax liabilities: | ||
Property, plant, and equipment | (4,066) | (1,392) |
Intangibles | (4,302) | (3,849) |
Lease assets | (57,798) | (52,264) |
Deferred financing cost | (310) | (399) |
Other | (1,739) | (1,309) |
Total deferred tax liabilities | (68,215) | (59,213) |
Deferred tax assets (liabilities), net | $ 1,268 | $ 3,734 |
Commitments & Contingencies - A
Commitments & Contingencies - Additional Information (Details) - USD ($) $ in Millions | Oct. 01, 2022 | Oct. 02, 2021 |
Workers' Compensation Insurance Program | Standby Letter of Credit | ||
Loss Contingencies [Line Items] | ||
Credit facility, remaining borrowing capacity | $ 10 | $ 9.2 |
General Liability Insurance Program | Maximum | ||
Loss Contingencies [Line Items] | ||
Self insurance retention amount | $ 0.4 | $ 0.4 |
Commitments & Contingencies - S
Commitments & Contingencies - Summary of Future Minimum Purchase Commitments (Details) $ in Thousands | Oct. 01, 2022 USD ($) |
Purchase Obligation, Fiscal Year Maturity [Abstract] | |
2023 | $ 4,143 |
2024 | 4,422 |
2025 | 3,366 |
2026 | 3,120 |
2027 | 1,339 |
Thereafter | 260 |
Total | $ 16,650 |
401(K) Plan - Additional Inform
401(K) Plan - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Defined Contribution Plan Disclosure [Line Items] | |||
Defined Contribution Plan, Tax Status [Extensible Enumeration] | us-gaap:QualifiedPlanMember | ||
Defined compensation plan matching contribution by employer | 50% | ||
Defined compensation plan by employee | 4% | ||
Defined contribution retirement plan expenses | $ 1.4 | $ 0.8 | $ 1.1 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | ||
Dec. 14, 2021 | Dec. 16, 2021 | Oct. 01, 2022 | Oct. 03, 2020 | |
Related Party Transaction [Line Items] | ||||
Paid or accrued management fees | $ 4.9 | |||
Common Stock | ||||
Related Party Transaction [Line Items] | ||||
Common stock, shares repurchased | 7,500,000 | 7,500,000 | ||
Common stock repurchased, price per share | $ 20.25 | |||
Bubbles Investor Aggregator, L.P. | Minimum | ||||
Related Party Transaction [Line Items] | ||||
Beneficial ownership interest in common stock | 5% | |||
Explorer Investment Pte. Ltd. | Minimum | ||||
Related Party Transaction [Line Items] | ||||
Beneficial ownership interest in common stock | 5% | |||
Bubbles Investor Aggregator, L.P. and Explorer Investment Pte. Ltd. | Common Stock | ||||
Related Party Transaction [Line Items] | ||||
Common stock, shares repurchased | 7,500,000 | |||
Common stock repurchased, price per share | $ 20.25 |
Share Repurchase Program (Addit
Share Repurchase Program (Additional Information) (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Dec. 03, 2021 | Dec. 16, 2021 | Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Equity, Class of Treasury Stock [Line Items] | |||||
Repurchase and retirement of common stock including offering costs | $ 152,146 | $ 0 | $ 0 | ||
Common Stock | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Authorized amount under share repurchase program | $ 300,000 | ||||
Period during which shares can be repurchased under share repurchase program | 3 years | ||||
Expiration date of share repurchase program | Dec. 03, 2024 | ||||
Common stock, shares repurchased | 7,500,000 | 7,500,000 | |||
Common stock repurchased, price per share | $ 20.25 | ||||
Repurchase of common stock | $ 151,900 | $ 151,875 | |||
Repurchase and retirement of common stock including offering costs | 152,100 | ||||
Additional Paid in Capital | 127,500 | ||||
Increase in retained earnings | $ 24,400 | ||||
Remained available amount under share repurchase program | $ 148,000 |
Share Repurchase Program - Sche
Share Repurchase Program - Schedule of Repurchases of Common Stock (Details) - Common Stock [Member] - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended |
Dec. 16, 2021 | Oct. 01, 2022 | |
Equity, Class of Treasury Stock [Line Items] | ||
Total number of shares repurchased | 7,500,000 | 7,500,000 |
Total amount paid for shares repurchased | $ 151,900 | $ 151,875 |
Equity-Based Compensation - Add
Equity-Based Compensation - Additional Information (Details) - USD ($) $ in Thousands, shares in Millions | 1 Months Ended | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Aggregate unamortized value of outstanding equity-based compensation awards | $ 29,100 | |||
Unamortized equity-based compensation costs, expected to be recognized, weighted average period | 2 years 6 months | |||
Dividend yield | 0% | |||
Selling, General and Administrative Expenses | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Equity-based compensation expense | $ 11,300 | $ 25,600 | $ 1,800 | |
Common Stock | 2020 Omnibus Incentive Plan | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Shares available for grant | 8.1 | |||
Stock Options | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Aggregate unamortized value of outstanding equity-based compensation awards | $ 9,477 | |||
Unamortized equity-based compensation costs, expected to be recognized, weighted average period | 1 year 9 months 18 days | |||
Dividend yield | 0% | |||
Stock Options | 2020 Omnibus Incentive Plan | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Option expiration period | 10 years | |||
Service Incentive Awards | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Award vesting period | 4 years | |||
Service Incentive Awards | Tranche One | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Award vesting percentage | 25% | |||
Service Incentive Awards | Tranche Two | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Award vesting percentage | 25% | |||
Service Incentive Awards | Tranche Three | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Award vesting percentage | 25% | |||
Service Incentive Awards | Tranche Four | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Award vesting percentage | 25% | |||
Incentive Awards | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Equity-based compensation, acceleration cost | $ 10,700 | |||
Dividend yield | 0% |
Equity-Based Compensation - Sum
Equity-Based Compensation - Summary of Weighted Average Assumptions Used for Incentive Awards/ Stock Options (Details) | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Dividend yield | 0% | ||
Incentive Awards | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Expected volatility | 23.50% | ||
Risk-free interest rate | 1.40% | ||
Dividend yield | 0% | ||
Expected term (in years) | 4 years | ||
Stock Options | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Expected volatility | 28.90% | ||
Risk-free interest rate | 0.70% | ||
Dividend yield | 0% | ||
Expected term (in years) | 6 years 3 months 18 days |
Equity-Based Compensation - S_2
Equity-Based Compensation - Summary of Incentive Awards Activity (Details) - Incentive Awards - $ / shares shares in Thousands | 12 Months Ended | |
Oct. 02, 2021 | Oct. 03, 2020 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Outstanding, Beginning Balance | 13,267 | 10,263 |
Cancelled upon IPO | 8,450 | 0 |
Converted to RSUs | 4,817 | 0 |
Granted | 0 | 5,980 |
Cancelled/forfeited | 0 | (2,976) |
Outstanding, Ending Balance | 0 | 13,267 |
Weighted Average Exercise Price, Granted | $ 1.87 |
Equity-Based Compensation - S_3
Equity-Based Compensation - Summary of Stock Options Activity Additional Information (Details) $ in Thousands | 12 Months Ended |
Oct. 01, 2022 USD ($) | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Unamortized value of unvested Stock Options | $ 29,100 |
Weighted average period (years) that expense is expected to be recognized | 2 years 6 months |
Stock Options | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Aggregate intrinsic value of Stock Options outstanding | $ 0 |
Unamortized value of unvested Stock Options | $ 9,477 |
Weighted average period (years) that expense is expected to be recognized | 1 year 9 months 18 days |
Weighted average remaining contractual life (years) for options outstanding | 8 years 7 months 6 days |
Equity-Based Compensation - S_4
Equity-Based Compensation - Summary of Stock Options Activity (Details) - Stock Options - $ / shares | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of Options, Beginning Balance | 4,877,000 | 0 | |
Number of Options, Granted | 0 | 5,372,000 | |
Number of Options, Exercised | (81,000) | 0 | |
Number of Options, Forfeited/Expired | (1,016,000) | (495,000) | |
Number of Options, Ending Balance | 3,780,000 | 4,877,000 | |
Vested and exercisable | (1,349,000) | 0 | |
Weighted Average Exercise Price, Granted | $ 0 | $ 18.43 | |
Weighted Average Exercise Price, Exercised | 17 | 0 | |
Weighted Average Exercise Price, Forfeited/Expired | 18.22 | 17.26 | |
Weighted Average Exercise Price, Balance, Ending | $ 18.24 | $ 18.22 | $ 0 |
Weighted Average Exercise Price, Vested and exercisable | (18.28) | 0 |
Equity-Based Compensation - S_5
Equity-Based Compensation - Summary of RSU Activity under Plan (Details) - Restricted Stock Units - $ / shares shares in Thousands | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 02, 2021 | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Outstanding, Beginning Balance | 3,135 | 0 | |
Converted from Incentive Awards | [1] | 0 | 6,038 |
Granted | 631 | 725 | |
Vested and exercisable | [2] | (1,079) | (3,321) |
Cancelled/forfeited | (390) | (307) | |
Outstanding, Ending Balance | 2,297 | 3,135 | |
Weighted Average Grant Date Fair Value, Outstanding, Beginning Balance | $ 6.90 | $ 0 | |
Weighted Average Grant Date Fair Value, Converted from Incentive Awards | [1] | 0 | 1.43 |
Weighted Average Grant Date Fair Value, Granted | 18.57 | 25.95 | |
Weighted Average Grant Date Fair Value, Vested | [2] | 5.99 | 1.10 |
Weighted Average Grant Date Fair Value, Cancelled/forfeited | 9.82 | 4.64 | |
Weighted Average Grant Date Fair Value, Outstanding, Ending Balance | $ 10.04 | $ 6.90 | |
[1] Represents approximately 4.8 million Service and Performance Incentive Awards converted to RSUs in connection with the IPO and adoption of the Plan during fiscal 2021. RSUs that vested during the year ended October 2, 2021 inclu des RSUs that were issued in connection with the IPO that vest only upon achievement of volume weighted average price (“VWAP”) targets established by the compensation committee of the board of directors (Performance RSUs). The VWAP target was measured over rolling 20 -day trading periods commencing on the six-month anniversary of the consummation of the IPO. |
Equity-Based Compensation - S_6
Equity-Based Compensation - Summary of RSU Activity under Plan (Parenthetical) (Details) - shares shares in Millions | 12 Months Ended | |
Oct. 01, 2022 | Oct. 02, 2021 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Awards converted to RSUs | 4.8 | |
Number of trading days | 20 days |
Equity-Based Compensation - S_7
Equity-Based Compensation - Summary of RSU Activity under Plan Additional Information (Details) $ in Thousands | 12 Months Ended |
Oct. 01, 2022 USD ($) | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Weighted average period (years) that expense is expected to be recognized | 2 years 6 months |
Restricted Stock Units | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Unamortized value of unvested RSUs | $ 19,622 |
Weighted average period (years) that expense is expected to be recognized | 2 years 9 months 18 days |
Earnings Per Share - Summary of
Earnings Per Share - Summary of Reconciliation of Basic Weighted Average Common Shares Outstanding to Diluted Weighted Average Common Shares Outstanding (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | |
Numerator: | |||
Net income | $ 159,029 | $ 126,634 | $ 58,561 |
Denominator: | |||
Basic | 184,347 | 185,412 | 156,500 |
Effect of dilutive securities: | |||
Stock Options | 0 | 567 | 0 |
RSUs | 1,801 | 4,030 | 0 |
Weighted average shares outstanding - diluted | 186,148 | 190,009 | 156,500 |
Basic earnings per share | $ 0.86 | $ 0.68 | $ 0.37 |
Diluted earnings per share | $ 0.85 | $ 0.67 | $ 0.37 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Antidilutive Securities Excluded from Calculation of Diluted Net Income Per Share (Details) - shares shares in Thousands | 12 Months Ended | |||
Oct. 01, 2022 | Oct. 02, 2021 | [1] | Oct. 03, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from calculation of diluted net income per share | 4,621 | 323 | 0 | |
Stock Options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from calculation of diluted net income per share | 4,020 | 321 | 0 | |
RSUs | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from calculation of diluted net income per share | 601 | 2 | 0 | |
[1] Excludes approximately 0.6 million Stock Options with performance conditions that have not yet been met or were not yet established as of October 2, 2021. |
Earnings Per Share - Schedule_2
Earnings Per Share - Schedule of Antidilutive Securities Excluded from Calculation of Diluted Net Income Per Share (Parenthetical) (Details) - shares shares in Thousands | 12 Months Ended | |||
Oct. 01, 2022 | Oct. 02, 2021 | Oct. 03, 2020 | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Dilutive weighted-average shares outstanding excluded from the calculation of diluted net income per share | 4,621 | 323 | [1] | 0 |
Stock Options with Performance Conditions | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Dilutive weighted-average shares outstanding excluded from the calculation of diluted net income per share | 600 | |||
[1] Excludes approximately 0.6 million Stock Options with performance conditions that have not yet been met or were not yet established as of October 2, 2021. |