DODGEVILLE, Wis., March 22, 2018 (GLOBE NEWSWIRE) Lands' End, Inc. (NASDAQ:LE) today announced financial results for the 14-week fourth quarter and 53-week fiscal year ended February 2, 2018, compared to the 13-week fourth quarter and 52-week fiscal year ended January 27, 2017.

Fourth Quarter Fiscal 2017 Highlights:

• Net revenue for the fourth quarter increased 11.3% to $510.6 million, which includes $25.9 million from the 53^rd week, compared to $458.8 million in the fourth quarter last year. Direct segment net revenue increased 14.3% to $455.6 million, including $24.2 million from the 53^rd week, as compared to the same period last year. Retail segment net revenue decreased 8.7% to $55.1 million, including $1.7 million from the 53^rd week, as compared to the same period last year, primarily due to fewer Lands' End Shops at Sears. Same store sales on a comparable 13-week basis increased 5.0%.
   
• Gross margin was 38.9% as compared to 38.6% in the fourth quarter last year.
   
• The Company recorded a tax benefit during the quarter of $21.9 million primarily due to the U.S. Tax Cuts and Jobs Act ("Tax Reform").
   
• Net income was $39.8 million, or $1.24 per diluted share. This compares to a Net loss of $94.8 million, or $2.96 per diluted share in the fourth quarter of fiscal 2016.
   
• Adjusted EBITDA⁽²⁾ was $37.3 million compared to $30.7 million in the fourth quarter of fiscal 2016.

Jerome S. Griffith, Chief Executive Officer, stated, "We are pleased with our strong performance in the fourth quarter, as we continued to gain momentum behind our merchandising, marketing, and digital initiatives, and ended the year on a solid note. During 2017, we stabilized the brand, grew our buyer file, reconnected with our core customer, improved our business processes, and drove growth across our four key categories. As we look forward, we will continue to execute on our strategic plan and continue to focus on driving consistent performance across the business."

Full Year Fiscal 2017 Highlights:

• Net revenue for fiscal 2017 increased 5.3% to $1.41 billion, which includes $25.9 million from the 53^rd week, compared to $1.34 billion last year. Direct segment net revenue increased 7.4% to $1.23 billion, including $24.2 million from the 53^rd week. Retail segment net revenue decreased 7.5% to $172.6 million, including $1.7 million from the 53^rd week, primarily due to fewer Lands' End Shops at Sears, partially offset by a 2.7% increase in same store sales on a comparable 52-week basis.
   
• Gross margin was 42.5% as compared to 43.2% last year.
   
• The Company recorded a tax benefit for the year of $27.7 million primarily due to the Tax Reform.
   
• Net income was $28.2 million, or $0.88 per diluted share. This compares to a Net loss of $109.8 million, or $3.43 per diluted share, in fiscal 2016.
   
• Adjusted EBITDA⁽²⁾ was $58.3 million compared to $39.8 million in fiscal 2016. 

Balance Sheet and Cash Flow Highlights

Cash and cash equivalents were $195.6 million as of February 2, 2018, compared to $213.1 million as of January 27, 2017. Net cash provided by operations was $28.4 million for the 53 weeks ended February 2, 2018, compared to net cash provided by operations of $24.1 million for the 52 weeks ended January 27, 2017.

Inventory was $332.3 million as of February 2, 2018, and $325.3 million as of January 27, 2017.

The Company had $152.7 million of availability under its asset-based senior secured credit facility and had $486.2 million of Long-term debt, net as of February 2, 2018.

Conference Call

The Company will host a conference call on Thursday, March 22, 2018, at 8:30 a.m. ET to review its fourth quarter and fiscal 2017 financial results and related matters. 

About Lands' End, Inc.

Lands' End, Inc. (NASDAQ:LE) is a leading multi-channel retailer of casual clothing, accessories, footwear and home products. We offer products through catalogs, online at www.landsend.com and affiliated specialty and international websites, and through retail locations.We are a classic American lifestyle brand with a passion for quality, legendary service and real value, and seek to deliver timeless style for women, men, kids and the home.

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LANDS’ END, INC.
Consolidated Balance Sheets
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LANDS’ END, INC.
Consolidated Statements of Operations
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Use and Definition of Non-GAAP Financial Measures

¹ Adjusted net income (loss) and Adjusted earnings (loss) per share - As a result of the Tax Reform, intangible asset impairment, transfer of corporate functions and impacts of product recall, the Company is presenting a reconciliation of Net income (loss) and Earnings per share determined in accordance with accounting principles generally accepted in the United States ("GAAP") to Adjusted Net income and Adjusted Earnings per share which excludes the impact of the Tax Reform, intangible asset impairment and the product recall.

² Adjusted EBITDA - In addition to our Net income, for purposes of evaluating operating performance, we use an Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA"), which is adjusted to exclude certain significant items as set forth below. Our management uses Adjusted EBITDA to evaluate the operating performance of our business, as well as for executive compensation metrics, for comparable periods. Adjusted EBITDA should not be used by investors or other third parties as the sole basis for formulating investment decisions as it excludes a number of important cash and non-cash recurring items.

³ The sum of net income (loss) and adjustments per diluted common share may not equal the Adjusted earnings per share due to rounding.

While Adjusted net income (loss)¹, Adjusted earnings (loss) per share¹ and Adjusted EBITDA² are non-GAAP measurements, management believes that they are important indicators of operating performance, and useful to investors, because:

• EBITDA excludes the effects of financings, investing activities and tax structure by eliminating the effects of interest, depreciation and income tax costs, and
  ° For the 14 and 53 weeks ended February 2, 2018 and the 13 and 52 weeks ended January 27, 2017, we exclude the loss on disposal of property and equipment as management considers the gains or losses on disposal of assets to result from investing decisions rather than ongoing operations.
• Other significant items, while periodically affecting our results, may vary significantly from period to period and have a disproportionate effect in a given period, which affects comparability of results. We have adjusted our results for these items to make our statements more comparable and therefore more useful to investors as the items are not representative of our ongoing operations.
  ° For the 13 and 52 weeks ended January 27, 2017, we exclude the impairment of our indefinite-lived trade name asset as this is a non-cash charge that is an unusual event that affects the comparability of our financial results.
  ° For the 14 and 53 weeks ended February 2, 2018, we exclude the impacts of the transfer of corporate functions, including severance and contract losses associated with a transition of certain corporate activities from our New York office to our Dodgeville headquarters.
  ° For the 14 and 53 weeks ended February 2, 2018, we exclude the impacts of the Tax Reform as they are a result of a nonrecurring event that affects the comparability of our financial results.
  ° For the 52 weeks ended January 27, 2017, an amount of a previously recorded recall was reversed due to lower than estimated customer return rates for the recalled products despite our efforts to contact impacted customers. These are unusual events that affect the comparability of our financial results.