National Vision Holdings, Inc. · NASDAQ:EYE
National Vision — Q1 2024 Earnings Presentation
36 slides from National Vision's earnings presentation, May 8, 2024
Slide 1: Q1 2024 Financial Results
Q1 2024 Financial Results May 8, 2024
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934. These statements include, but are not limited to, sta
Slide 3: Today's Presenters
Today's Presenters Q1 2024 Q1 2024 Financial Review Highlights and 2024 Outlook Reade Fahs Melissa Rasmussen Chief Executive Officer Chief Financial Officer 3 3
Slide 4: Q1 2024 Highlights
Q1 2024 Highlights Continuing Operations Total Company Change vs Change vs In millions Q1 2024 Q1 2023 Q1 2023 Q1 2024 Q1 2023 Q1 2023 Net Revenue $542.5 $520.8 4.2% $560.9 $562.4 (0.3)% Adjusted Comparable Store Sales Growth1 0.4% (0.1)% Adjusted Operating Income1 $35.8 $33.9 5.5% $35.0 $39.9 (12.3
Slide 5: Advancing Strategic Initiatives
Advancing Strategic Initiatives Recruiting & Retention: Continue to leverage flexible scheduling options and remote to drive ongoing Significantly improvement in retention and recruiting efforts Expand Remote: Plan to deploy remote capabilities to at least 150 additional America's Best locations inc
Slide 6: Q1 2024 Financial Update
Q1 2024 Financial Update Vision —
Slide 7: Q1 2024 Revenue Drivers - Continuing Operations
Q1 2024 Revenue Drivers - Continuing Operations Net Revenue ($M) Total Store Count $542.5 ❖ Net revenue increased 4.2% vs. Q1 2023 $520.8 1,201 1,128 primarily due to: • Growth from new store sales and 4.2% increase in Adjusted Comparable increase Store Sales Growth1 of 0.4% above Q1 2023 • Positive
Slide 8: Q1 2024 Results - Continuing Operations
Q1 2024 Results - Continuing Operations Adjusted Operating Income1 ($M) ❖ Costs applicable to revenue as percentage of net revenue increased 60 bps to 45.8% vs. Q1 2023 primarily due to: • 110 basis-point decrease in product gross margin, $35.8 $33.9 partially offset by 50 basis-point increase in se
Slide 9: Q1 2024 Capital Structure and Cash Flow Highlights
Q1 2024 Capital Structure and Cash Flow Highlights ❖ Strong liquidity position • $444M of liquidity at end of Q1, including a cash balance of $150M • Net debt to TTM Adjusted EBITDA1: 2.0x • No borrowings outstanding under our revolving credit facility ❖ Capital expenditures • $20M YTD primarily foc
Slide 10: 2024 Capital Allocation Priorities
2024 Capital Allocation Priorities Healthy balance sheet enables robust and disciplined capital plan designed for continued growth and balanced with opportunistically returning capital to shareholders 2024 Expecting Capital Expenditures of $110 - $115 Million for Invest in Growth new store openings
Slide 11: Outlook
Outlook 11 11
Slide 12: Reaffirms Total Company Fiscal 2024 Outlook
Reaffirms Total Company Fiscal 2024 Outlook Total Company Fiscal 2024 Outlook New Stores 65 - 70 Adjusted Comparable Store Sales Growth1 2.0% - 4.0% Net Revenue $1.965 - $2.005 billion Adjusted Operating Income $61 - $76 million Adjusted Diluted EPS2 $0.50 - $0.65 Depreciation and Amortization3 $95
Slide 13: Walmart Vision Center and AC Lens FY24 Expected Effect
Walmart Vision Center and AC Lens FY24 Expected Effect FY 2024 Outlook Walmart Vision Center ~$18 million1 AC Lens ~$122 Million Total Walmart Vision Center & AC Lens Revenue ~$140 Million Walmart Vision Center ~(0.8) million1 AC Lens ~$2 Million2 Total Walmart Vision Center & AC Lens Adjusted Opera
Slide 14: FY24 Outlook on Go-Forward Business
FY24 Outlook on Go-Forward Business FY 2024 Outlook excl. Walmart Vision FY 2024 Total Company Outlook Center and AC Lens Operations Total Revenue $1.965 - $2.005 Billion ~$1.825 - $1.865 Billion Total Adjusted Operating Income $61 - $76 Million ~$60 - $75 Million Total Adjusted Operating Income 3.1
Slide 15: Total Company Fiscal 2024 Outlook Considerations
Total Company Fiscal 2024 Outlook Considerations Revenue FY24 outlook includes the revenue from the Walmart operations through February 2024 and the expected revenue from the AC Lens operations through June 2024. FY24 outlook includes: • ~$18 Million of Revenue from Walmart Vision Center operations
Slide 16: Adjusted Operating Margin Progression 2023 - 2025
Adjusted Operating Margin1 Progression 2023 - 2025 2024 results and return to mid-single-digit (MSD) adjusted comparable store sales growth are critical to achieving our fiscal 2025 Adjusted Operating Margin target2 Original 2023 Guidance3 2023 Actual 2024 Guidance4 2025 Target @ Midpoint @ Midpoint
Slide 17: Appendix
Appendix 17 17
Slide 18: Q1 2024 Consolidated Financial Results (Unaudited)
Q1 2024 Consolidated Financial Results (Unaudited) Three Months Ended Dollars and shares in thousands, except Earnings Per Share March 30, 2024 April 1, 2023 Revenue: Net product sales $ 447,812 $ 436,114 Net sales of services and plans 94,711 84,683 Total net revenue 542,523 520,797 Costs applicabl
Slide 19: Reconciliation of Adjusted Operating Income from Continuing Operations to Net Income
Reconciliation of Adjusted Operating Income from Continuing Operations to Net Income (Unaudited) Three Months Ended Dollars in thousands March 30, 2024 April 1, 2023 Total net revenue $ 542,523 $ 520,797 Net income 11,685 18,270 Income (loss) from discontinued operations, net of tax (554) 2,297 Inco
Slide 20: Reconciliation of Adjusted Operating Income from Discontinued Operations
Reconciliation of Adjusted Operating Income from Discontinued Operations to Income (Loss) from Discontinued Operations, Net of Tax (Unaudited) Three Months Ended Dollars in thousands March 30, 2024 April 1, 2023 Total net revenue from discontinued operations $ 18,384 $ 41,572 Income (loss) from disc
Slide 21: Reconciliation of Adjusted Operating Income to Net Income
Reconciliation of Adjusted Operating Income to Net Income (Unaudited) Three Months Ended Dollars in thousands March 30, 2024 April 1, 2023 Net income $ 11,685 $ 18,270 Interest expense, net 4,256 4,867 Income tax provision 5,660 10,175 Stock-based compensation expense (a) 2,465 4,315 Asset impairmen
Slide 22: Reconciliation of Adjusted EBITDA from Continuing Operations to Net Income
Reconciliation of Adjusted EBITDA from Continuing Operations to Net Income (Unaudited) Three Months Ended Twelve Months Ended Dollars in thousands March 30, 2024 April 1, 2023 March 30, 2024 Total net revenue $ 542,523 $ 520,797 Net income 11,685 18,270 $ (72,486) Income (loss) from discontinued ope
Slide 23: Reconciliation of Adjusted EBITDA to Net Income
Reconciliation of Adjusted EBITDA to Net Income (Unaudited) Three Months Ended Twelve Months Ended Dollars in thousands March 30, 2024 April 1, 2023 March 30, 2024 Net income (loss) $ 11,685 $ 18,270 $ (72,486) Interest expense, net 4,256 4,867 13,728 Income tax provision (benefit) 5,660 10,175 (378
Slide 24: Reconciliation of Adjusted Diluted EPS from Continuing Operations
Reconciliation of Adjusted Diluted EPS from Continuing Operations to Diluted EPS (Unaudited) Three Months Ended Shares in thousands, except per share amounts March 30, 2024 April 1, 2023 Diluted EPS $ 0.15 $ 0.22 Diluted EPS from discontinued operations (0.01) 0.02 Diluted EPS from continuing operat
Slide 25: Reconciliation of Adjusted Diluted EPS from Discontinued Operations
Reconciliation of Adjusted Diluted EPS from Discontinued Operations to Diluted EPS from Discontinued Operations (Unaudited) Three Months Ended Shares in thousands, except per share amounts March 30, 2024 April 1, 2023 Diluted EPS from discontinued operations $ (0.01) $ 0.02 Stock-based compensation
Slide 26: Reconciliation of Adjusted Diluted EPS to Diluted EPS
Reconciliation of Adjusted Diluted EPS to Diluted EPS (Unaudited) Three Months Ended Shares in thousands, except per share amounts March 30, 2024 April 1, 2023 Diluted EPS $ 0.15 $ 0.22 Stock-based compensation expense (a) 0.03 0.05 Asset impairment (c) 0.01 0.00 Litigation settlement (d) 0.06 — Amo
Slide 27: Reconciliation of Adjusted SG&A from Continuing Operations
Reconciliation of Adjusted SG&A from Continuing Operations to SG&A from Continuing Operations (Unaudited) Three Months Ended Dollars in thousands March 30, 2024 April 1, 2023 Total net revenue $ 542,523 $ 520,797 SG&A 245,366 233,331 Stock-based compensation expense (a) 2,435 4,087 Litigation settle
Slide 28: Reconciliation of Adjusted SG&A Plus Discontinued Operations SG&A
Reconciliation of Adjusted SG&A to SG&A Plus SG&A from Discontinued Operations (Unaudited) Three Months Ended Dollars in thousands March 30, 2024 April 1, 2023 SG&A $ 245,366 $ 233,331 SG&A from discontinued operations 11,386 16,591 SG&A plus SG&A from discontinued operations 256,752 249,922 Stock-b
Slide 29: Reconciliation of Total Company Net Revenue to Total Net Revenue
Reconciliation of Total Company Net Revenue to Total Net Revenue (Unaudited) Three Months Ended Dollars in thousands March 30, 2024 April 1, 2023 Total net revenue $ 542,523 $ 520,797 Total net revenue from discontinued operations 18,384 41,572 Total Company Net Revenue $ 560,907 $ 562,369 29 29
Slide 30: Non-GAAP to GAAP Financial Measures Footnotes
Reconciliation of Non-GAAP to GAAP Financial Measures Footnotes a. Non-cash charges related to stock-based compensation programs, which vary from period to period depending on the timing of awards and performance vesting conditions. b. Reflects the extinguishment loss related to the repurchase of $1
Slide 31: Reconciliation of Adjusted Comparable Stores Sales Growth from Continuing Operations
Reconciliation of Adjusted Comparable Stores Sales Growth from Continuing Operations (Unaudited) Comparable store sales growth from continuing operations (a) Three Months Three Months Ended March 30, Ended April 1, 2024 2023 Owned & Host segment America’s Best 1.2 % 1.7 % Eyeglass World (5.0)% (1.3)
Slide 32: Reconciliation of Adjusted Comparable Stores Sales Growth
Reconciliation of Adjusted Comparable Stores Sales Growth (Unaudited) Comparable store sales growth (a) Three Months Three Months Ended March 30, Ended April 1, 2024 2023 2024 Outlook (b) Owned & Host segment America’s Best 1.2 % 1.7 % Eyeglass World (5.0)% (1.3)% Military (1.4)% 3.2 % Fred Meyer (5
Slide 33: Capital Structure and Cash Flow
Capital Structure and Cash Flow Less: Deferred Amounts Q1 2024 Capital Structure ($M) Debt Financing per Balance % of Amount Costs Sheet Total Coupon Maturity First Lien - Term A Loans $ 144.4 $ (1.0) $ 143.4 31 % Term SOFR + 1.50% 6/13/2028 First Lien - Revolving Loans1 — — — —% Term SOFR + 1.50% 6
Slide 34: Adjusted Comparable Store Sales Growth Primer
Adjusted Comparable Store Sales Growth Primer What is Adjusted Comparable Store Sales Growth? • Calculated using net revenue on a cash-basis • Excludes the impact of unearned and deferred revenue Why use Adjusted Comparable Store Sales Growth? • Provides a clear view of the Company’s current operati
Slide 35: Unearned Revenue Primer
Unearned Revenue Primer 35 35
Slide 36: Check out some of our latest commercials
Check out some of our latest commercials: National Vision Commercials Check out our video demonstrating a remote exam: Remote Care with National Vision 36 36
National Vision Holdings — Q1 2024 Earnings Presentation on 6ix