| Adjusted EBITDA To Operating Income (Loss) And Consolidated Net Income |
The following tables reconcile Adjusted EBITDA to operating income for HSNi’s operating segments and to HSNi’s consolidated net income (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, 2015 |
|
Three Months Ended September 30, 2014 |
|
HSN |
|
Cornerstone |
|
Total |
|
HSN |
|
Cornerstone |
|
Total |
Adjusted EBITDA |
$ |
67,109 |
|
|
$ |
11,028 |
|
|
$ |
78,137 |
|
|
$ |
66,730 |
|
|
$ |
14,255 |
|
|
$ |
80,985 |
|
Stock-based compensation expense |
(3,292 |
) |
|
(1,097 |
) |
|
(4,389 |
) |
|
(3,086 |
) |
|
(795 |
) |
|
(3,881 |
) |
Depreciation and amortization |
(7,318 |
) |
|
(3,290 |
) |
|
(10,608 |
) |
|
(7,477 |
) |
|
(3,678 |
) |
|
(11,155 |
) |
Distribution center closure (a) |
(189 |
) |
|
— |
|
|
(189 |
) |
|
— |
|
|
— |
|
|
— |
|
Asset impairment (b) |
— |
|
|
(5,000 |
) |
|
(5,000 |
) |
|
— |
|
|
— |
|
|
— |
|
(Loss) gain on disposition of fixed assets |
(115 |
) |
|
(3 |
) |
|
(118 |
) |
|
5 |
|
|
14 |
|
|
19 |
|
Operating income |
$ |
56,195 |
|
|
$ |
1,638 |
|
|
57,833 |
|
|
$ |
56,172 |
|
|
$ |
9,796 |
|
|
65,968 |
|
Total other expense, net |
|
|
|
|
(4,063 |
) |
|
|
|
|
|
(1,833 |
) |
Income before income taxes |
|
|
|
|
53,770 |
|
|
|
|
|
|
64,135 |
|
Income tax provision |
|
|
|
|
(19,562 |
) |
|
|
|
|
|
(24,604 |
) |
Net income |
|
|
|
|
$ |
34,208 |
|
|
|
|
|
|
$ |
39,531 |
|
|
(a) In the third quarter of 2015, HSN recorded a $0.2 million charge associated with the planned closure of one of its distribution centers as part of its supply chain optimization initiative. See Note 13 for further information.
(b) In the third quarter of 2015, Cornerstone recognized a $5.0 million non-cash charge for the impairment of intangible assets related to the acquisition of Chasing Fireflies. See Note 8 for further information.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30, 2015 |
|
Nine Months Ended September 30, 2014 |
|
HSN |
|
Cornerstone |
|
Total |
|
HSN |
|
Cornerstone |
|
Total |
Adjusted EBITDA |
$ |
201,493 |
|
|
$ |
39,820 |
|
|
$ |
241,313 |
|
|
$ |
188,530 |
|
|
$ |
34,305 |
|
|
$ |
222,835 |
|
Stock-based compensation expense |
(10,518 |
) |
|
(3,296 |
) |
|
(13,814 |
) |
|
(9,283 |
) |
|
(2,408 |
) |
|
(11,691 |
) |
Depreciation and amortization |
(22,326 |
) |
|
(10,616 |
) |
|
(32,942 |
) |
|
(22,337 |
) |
|
(10,377 |
) |
|
(32,714 |
) |
Distribution center closure (a) |
(3,221 |
) |
|
— |
|
|
(3,221 |
) |
|
— |
|
|
— |
|
|
— |
|
Asset impairment (b) |
— |
|
|
(5,000 |
) |
|
(5,000 |
) |
|
— |
|
|
— |
|
|
— |
|
CPSC settlement (c) |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(3,100 |
) |
|
(3,100 |
) |
Loss on disposition of fixed assets |
(779 |
) |
|
(11 |
) |
|
(790 |
) |
|
(100 |
) |
|
(27 |
) |
|
(127 |
) |
Operating income |
$ |
164,649 |
|
|
$ |
20,897 |
|
|
185,546 |
|
|
$ |
156,810 |
|
|
$ |
18,393 |
|
|
175,203 |
|
Total other expense, net |
|
|
|
|
(11,241 |
) |
|
|
|
|
|
(5,343 |
) |
Income before income taxes |
|
|
|
|
174,305 |
|
|
|
|
|
|
169,860 |
|
Income tax provision |
|
|
|
|
(64,776 |
) |
|
|
|
|
|
(65,207 |
) |
Net income |
|
|
|
|
$ |
109,529 |
|
|
|
|
|
|
$ |
104,653 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) In the nine months ended September 30, 2015, HSN recorded $3.2 million in charges associated with the planned closure of one of its distribution centers as part of its supply chain optimization initiative. See Note 13 for further information.
(b) In the third quarter of 2015, Cornerstone recognized a $5.0 million non-cash charge for the impairment of intangible assets related to the acquisition of Chasing Fireflies. See Note 8 for further information.
(c) In the first quarter of 2014, Cornerstone recorded a $3.1 million settlement of a civil penalty assessed by the Consumer Product Safety Commission.
|
| Financial Information By Segment |
The net sales for each of HSNi's reportable segments are as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2015 |
|
2014 |
|
2015 |
|
2014 |
Net sales: |
|
|
|
|
|
|
|
|
HSN |
|
$ |
590,588 |
|
|
$ |
578,297 |
|
|
$ |
1,763,384 |
|
|
$ |
1,679,271 |
|
Cornerstone |
|
274,280 |
|
|
259,180 |
|
|
829,013 |
|
|
790,830 |
|
Total |
|
$ |
864,868 |
|
|
$ |
837,477 |
|
|
$ |
2,592,397 |
|
|
$ |
2,470,101 |
|
|