NYSE: BURL

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Jul 17, 2018 04:02 PM Pricing delayed 20 minutes

Press Release Details

Burlington Stores, Inc. Announces Second Quarter and First Half Fiscal 2014 Results

09/09/2014
  • For the Fiscal 2014 Second Quarter:
    • Comparable store sales increased 4.7% and Net sales rose 8.3%
    • Adjusted EBITDA increased 24%, or $11.2 million
    • Comparable stores - inventory decreased 18%, and turnover improved 22%
    • Adjusted loss per share was $(0.01) vs. a loss of $(0.19) last year
  • First half Fiscal 2014 adjusted diluted EPS of $0.23 increased significantly from an adjusted loss per share of $(0.10) in the first half of Fiscal 2013
  • Company Increases Fiscal Year 2014 Outlook

BURLINGTON, N.J.--(BUSINESS WIRE)-- Burlington Stores, Inc. (NYSE:BURL), a nationally recognized off-price retailer of high-quality, branded apparel at everyday low prices, today announced its results for the second quarter and first six months ended August 2, 2014.

Tom Kingsbury, President and Chief Executive Officer stated, “We are extremely pleased with our second quarter performance highlighted by a 4.7% increase in comparable store sales on top of last year’s very strong 7.8% increase. Our 70 basis point increase in Adjusted EBITDA rate was driven by both operating expense leveraging and gross margin expansion versus last year. We continue to believe that these results are indicative of the continued improvement in the execution of our off-price model. We believe we are well positioned for the fall season based on the level and currency of our inventory and remain focused on delivering great value, brands,store experience and fresh product to our customers every day. I would like to thank our store and corporate teams for contributing to these results.”

Note regarding Non-GAAP financial measures

The following discussion includes references to Adjusted EBITDA, Adjusted Net Income (Loss), and Adjusted EPS. The Company believes these measures are useful in evaluating the operating performance of the business and for comparing its results to that of other retailers. These non-GAAP financial measures are defined and reconciled to the most comparable GAAP measure later in this document.

Second Quarter Fiscal 2014 Operating Results (for the 13 week period ended August 2, 2014 compared with the 13 week period ended August 3, 2013):

  • Comparable store sales increased 4.7%, which follows a comparable store sales increase of 7.8% in the 2013 second quarter driven by improved execution of the Company’s off-price business model.
  • Net sales increased 8.3%, or $79.9 million, to $1,043.6 million. This increase includes the 4.7% increase in comparable store sales, as well as an increase of $36.3 million from new and non-comparable stores.
  • Gross margin expanded by 50 basis points to 38.2% from 37.7% in the second quarter of Fiscal 2013. This more than offset an approximate 40 basis point increase in product sourcing costs that are included in selling, general and administrative expenses (SG&A).
  • SG&A, less product sourcing costs and advisory fees, as a percentage of net sales was 29.0% vs. 29.7% in the second quarter of Fiscal 2013 driven by improved leverage in store payroll, store expenses and other SG&A.
  • Adjusted EBITDA increased 23.8%, or $11.2 million, to $58.1 million. Sales growth, SG&A leverage and gross margin expansion led to a 70 basis point expansion in Adjusted EBITDA as a percentage of net sales, as compared to the second quarter of Fiscal 2013.
  • Depreciation and amortization expense, exclusive of net favorable lease amortization, decreased $0.4 million to $34.0 million.
  • Interest Expense decreased $7.8 million to $25.5 million from last year, driven by interest savings related to principal payments made over the last twelve months on the Company`s Holdco Notes and Term Loan.
  • Adjusted tax benefit was $(0.6) million compared to $(7.2) million last year. The adjusted effective tax rate was 39.9% vs. 34.5% last year. The increase in the tax rate is the result of certain tax credits not legislatively approved and available in the current year and other one-time discrete items recorded in the prior year.
  • Adjusted Net Loss was $(0.9) million vs. $(13.6) million last year, or $(0.01) per share vs. $(0.19) last year. Shares outstanding were 74.0 million vs. 72.9 million pro forma shares last year.

First Half Fiscal 2014 Operating Results (for the 26 week period ended August 2, 2014 compared with the 26 week period ended August 3, 2013):

  • Comparable store sales increased 3.6% following a 5.5% increase in the first half of Fiscal 2013. This increase was driven by the improved execution of the Company’s off-price model.
  • Net sales increased 7.1%, or $143.1 million, to $2,171.9 million. This increase includes the 3.6% increase in comparable store sales, as well as an increase of $76.6 million from new and non-comparable stores.
  • Gross margin expanded by 60 basis points to 38.1% from 37.5% last year. This more than offset an approximate 30 basis point increase in product sourcing costs that are included in SG&A.
  • SG&A, less product sourcing costs and advisory fees, as a percentage of net sales was 27.9% vs. 28.3% last year. The 40 basis point improvement was driven by increased leverage in store payroll, other store expenses, and other SG&A.
  • Adjusted EBITDA increased 18.9%, or $23.9 million, to $150.4 million. The 70 basis point expansion in Adjusted EBITDA as a percent of net sales was driven by sales growth coupled with expense leverage and gross margin expansion.
  • Depreciation and amortization expense, exclusive of net favorable lease amortization, decreased $0.9 million to $68.7 million.
  • Interest Expense decreased $15.5 million to $52.1 million from last year, driven by interest savings related to principal payments over the last twelve months on the Company`s Holdco Notes and Term Loan. In addition, the Company realized savings as a result of the 2013 Term Loan refinancing.
  • Adjusted tax expense was $12.0 million compared to a tax benefit of $(3.1) million last year. The adjusted effective tax rate was 40.3% vs. 29.6% last year. The increase in the tax rate is the result of certain tax credits not legislatively approved and available in the current year and other one-time discrete items recorded in the prior year.
  • Adjusted Net Income was $17.7 million versus an Adjusted Net Loss of $(7.4) million last year, or $0.23 per diluted share vs. $(0.10) last year. Diluted shares outstanding were 75.6 million vs. pro forma basic shares outstanding of 72.6 million last year.

Inventory:

  • Merchandise Inventories were $711.5 million vs. $748.3 million at August 3, 2013. The decrease was primarily driven by a comparable store inventory decrease of 18% as a part of the ongoing initiative to reduce inventory levels, increase inventory turnover and ultimately drive incremental sales through continually improved product offerings. This decrease was partially offset by a $41 million increase in pack and hold purchases and inventory related to the opening of 20 net new stores since August 3, 2012.

Fiscal Year Q3 and Full Year 2014 Outlook

The Company is introducing its third quarter guidance and raising its full year fiscal year 2014 outlook based on its better than expected sales and net income performance during the first half of the year and its expectations for the balance of the year, including a reduction of interest expense associated with the debt refinancing completed on August 13, 2014.

For the third quarter of Fiscal 2014 (the 13 weeks ending November 1, 2014), the Company expects:

  • Net sales to increase in the range of 6.4% to 7.4%;
  • Comparable store sales to increase in the range of 3.0% to 4.0%;
  • Interest expense to approximate $17 million reflecting the debt refinancing completed on August 13, 2014;
  • Adjusted Net Income per diluted share in the range of $0.09 to $0.12 on 75.8 million diluted shares outstanding. This compares to an adjusted loss per pro forma share of $(0.05) in the third quarter of Fiscal 2013; and
  • To open 17 new stores and close one existing store resulting in a total store count of 539 at the end of the third quarter.

For the full Fiscal Year 2014, (the 52-weeks ending January 31, 2015), the Company currently expects:

  • Total sales to increase in the range of 6.5% to 7.2% versus its previous expectation of an increase in the range of 5.8% to 6.8% and comparable store sales for the full year to be approximately 3%, at the high end of its previous guidance. These estimates include a comparable store sales increase of 2% to 3% in the fourth quarter consistent with previous guidance;
  • Adjusted EBITDA margin expansion in the range of 20 to 30 basis points, as compared to previous guidance of 10 to 20 basis points;
  • Interest expense of approximately $85 million;
  • A tax rate of approximately 40%;
  • Fully Diluted Adjusted Net Income in the range of $1.52 to $1.58 per share, utilizing a fully diluted share count of 75.7 million shares. This compares to the Company’s previous expectation for fully diluted adjusted net income in the range of $1.25 to $1.35; and
  • To have opened 24 new stores and closed two existing stores resulting in a total store count of 543 at the end of the year.

Second Quarter 2014 Conference Call

The Company will hold a conference call on Tuesday, September 9, 2014 at 8:30 a.m. Eastern Time to discuss the Company’s second quarter Fiscal 2014 results. The U.S. toll free dial-in for the conference call is 1-877-407-0789 and the international dial-in number is 1-201-689-8562. The conference ID is 13589432.

A live webcast of the conference call will also be available on the investor relations page of the Company's website at www.burlingtoninvestors.com. For those unable to participate in the conference call, a replay will be available beginning at 11:30 a.m. ET, September 9, 2014 until 11:59 p.m. ET on September 16, 2014. The U.S. toll-free replay dial-in number is 1-877-870-5176 and the international replay dial-in number is 1-858-384-5517. The replay pin number is 13589432. Additionally, a replay of the call will be available on the investor relations page of the company's website at www.burlingtoninvestors.com.

About Burlington Stores, Inc.

The Company, through its wholly-owned subsidiaries, operates a national chain of off-price retail stores offering ladies’, men’s and children’s apparel and accessories, home goods, baby products and coats, principally under the name Burlington Stores.

For more information about Burlington Stores, Inc., visit the Company's website at www.burlingtonstores.com.

Safe Harbor for Forward-Looking and Cautionary Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact included in this release are forward-looking statements. Forward-looking statements discuss our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. We do not undertake to publicly update or revise our forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied in such statements will not be realized. If we do update one or more forward-looking statements, no inference should be made that we will make additional updates with respect to those or other forward-looking statements. All forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those we expected, including competition in the retail industry, seasonality of our business, adverse weather conditions, changes in consumer preferences and consumer spending patterns, import risks, inflation, general economic conditions, our ability to implement our strategy, our substantial level of indebtedness and related debt-service obligations, restrictions imposed by covenants in our debt agreements, availability of adequate financing, our dependence on vendors for our merchandise, events affecting the delivery of merchandise to our stores, existence of adverse litigation and risks, availability of desirable locations on suitable terms and other factors that may be described from time to time in our filings with the Securities and Exchange Commission (SEC). For each of these factors, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, as amended.

     
BURLINGTON STORES, INC.
CONSOLIDATED BALANCE SHEET
(unaudited)
(All amounts in thousands)
 
August 2, February 1, August 3,
  2014     2014     2013  
ASSETS
Current Assets:
Cash and Cash Equivalents $ 29,291 $ 132,984 $ 33,407
Restricted Cash and Cash Equivalents 32,100 32,100 34,800
Accounts Receivable - Net of Allowance for

Doubtful Accounts

43,678 35,678 41,640
Merchandise Inventories 711,510 720,052 748,308
Deferred Tax Assets 14,172 13,475 12,411
Prepaid and Other Current Assets 76,131 77,708 74,360
Prepaid Income Taxes   31,691     4,523     14,668  
Total Current Assets 938,573 1,016,520 959,594
Property and Equipment - Net of Accumulated

Depreciation and Amortization

932,566 902,657 882,190
Tradenames 238,000 238,000 238,000
Favorable Leases - Net of Accumulated Amortization 279,349 292,553 306,315
Goodwill 47,064 47,064 47,064
Other Assets   119,750     124,298     132,737  
Total Assets $ 2,555,302   $ 2,621,092   $ 2,565,900  
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts Payable $ 564,531 $ 542,987 $ 555,593
Other Current Liabilities 270,475 301,803 270,786
Current Maturity of Long Term Debt   1,250     59,026     9,663  
Total Current Liabilities 836,256 903,816 836,042
 
Long Term Debt 1,371,819 1,369,159 1,684,675
Other Liabilities 258,241 255,877 237,031
Deferred Tax Liability 229,132 242,708 247,065
Commitments and Contingencies
Common Stock, Class L - - 1,076,244
 
Stockholders’ Deficit:

Preferred Stock, $0.0001 Par Value: Authorized: 50,000,000 shares; no shares issued and outstanding at August 2, 2014

 

 

 

Common Stock, $0.0001 Par Value: Authorized: 500,000,000 shares at August 2, 2014 and February 1, 2014 and 582,771,244 shares at August 3, 2013

 

 

 

Issued: 74,809,682 shares at August 2, 2014, 74,218,275 shares at February 1, 2014 and 528,314,688 shares at August 3, 2013

 

 

 

Outstanding: 74,158,072 shares at August 2, 2014, 73,686,524 shares at February 1, 2014 and 523,502,100 shares at August 3, 2013

7 7 47
Additional Paid-In-Capital 1,354,363 1,346,259 -
Accumulated Deficit (1,487,105 ) (1,492,409 ) (1,515,200 )
Treasury Stock at Cost:   (7,411 )   (4,325 )   (4 )
Total Stockholders' Deficit   (140,146 )   (150,468 )   (1,515,157 )
Total Liabilities and Stockholders' Deficit $ 2,555,302   $ 2,621,092   $ 2,565,900  
BURLINGTON STORES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(unaudited)
(All amounts in thousands)
 
Six Months Ended   Three Months Ended
August 2   August 3, August 2,   August 3,
2014 2013 2014 2013
 
REVENUES:
Net Sales $ 2,171,850 $ 2,028,724 $ 1,043,581 $ 963,711
Other Revenue   15,134     15,745     7,545     7,769  
Total Revenue 2,186,984 2,044,469 1,051,126 971,480
 
COSTS AND EXPENSES:
Cost of Sales 1,343,488 1,267,973 645,027 600,320
Selling, General and Administrative Expenses 697,047 654,461 350,026 326,757
Costs Related to Debt Amendments,

Secondary Offering and Other

1,341 11,457 917 2,603
Stock Option Modification Expense 1,791 7,263 963 7,263
Restructuring and Separation Costs - 2,179 - 554
Depreciation and Amortization 81,757 85,239 40,549 41,247
Impairment Charges-Long-Lived Assets 848 139 829 88
Other Income, Net (3,864 ) (4,605 ) (1,968 ) (2,059 )
Loss on Extinguishment of Debt 3,681 617 - 617
Interest Expense (Inclusive of Gain (Loss)

on Interest Rate Cap Agreements)

  52,098     67,630     25,546     33,327  
Total Cost and Expenses   2,178,187     2,092,353     1,061,889     1,010,717  
Income (Loss) Before Income Tax

Expense (Benefit)

8,797 (47,884 ) (10,763 ) (39,237 )
Income Tax Expense (Benefit)   3,493     (17,307 )   (4,293 )   (14,223 )
Net Income (Loss) $ 5,304   $ (30,577 ) $ (6,470 )

 

$ (25,014 )
Total Comprehensive Income (Loss) $ 5,304   $ (30,577 ) $ (6,470 ) $ (25,014 )
     
BURLINGTON STORES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)
(All amounts in thousands)
 
Six Months Ended
August 2, August 3,
2014   2013
OPERATING ACTIVITIES
Net Income (Loss) $ 5,304 $ (30,577 )
Adjustments to Reconcile Net Income (Loss) to Net Cash

Provided by Operating Activities:

Depreciation and Amortization 81,757 85,239
Amortization of Deferred Financing Costs 4,384 4,585
Impairment Charges – Long-Lived Assets 848 139
Accretion of Senior Notes 1,100 1,566
Interest Rate Cap Contracts —Adjustment to Market 1 55
Provision for Losses on Accounts Receivable 75 103
Deferred Income Tax (Benefit) (14,273 ) (12,551 )
Loss (Gain) on Disposition of Fixed Assets and

Leasehold Improvements

270 (57 )

Non-Cash Loss on Extinguishment of Debt – Write-off of

Deferred Financing Costs and Original Issue Discount

2,521 466
Non-Cash Stock Compensation Expense 3,152 5,685
Non-Cash Rent Expense (10,122 ) (6,330 )
Deferred Rent Incentives 13,807 18,079
Excess Tax Benefit from Stock Based

Compensation

(4,023 ) -
Insurance Recoveries - 2,391
Changes in Assets and Liabilities:
Accounts Receivable (8,266 ) (5,634 )
Merchandise Inventories 8,541 (68,118 )
Prepaid and Other Current Assets (24,811 ) (15,758 )
Accounts Payable 21,544 55,187
Other Current Liabilities (32,076 ) 22,829
Other Long Term Assets and Long Term Liabilities   1,846     563  
Net Cash Provided by Operating Activities   51,579     57,862  
 
INVESTING ACTIVITIES
Cash Paid for Property and Equipment (94,569 ) (67,999 )
Proceeds from Sale of Property and Equipment and

Assets Held for Sale

  136     393  
Net Cash Used in Investing Activities   (94,433 )   (67,606 )
 
 
BURLINGTON STORES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(All amounts in thousands)
 
August 2, August 3,

2014

  2013
FINANCING ACTIVITIES
Proceeds from Long Term Debt—ABL Line of Credit 275,000 339,000
Principal Payments on Long Term Debt—ABL Line of Credit (275,000 ) (324,000 )
Principal Payments on Long Term Debt—Term Loan (3,955 ) (2,178 )
Proceeds from Long Term Debt—Holdco Notes - 343,000
Principal Payments on Long Term Debt – Holdco Notes (58,000 ) -
Repayment of Capital Lease Obligations (486 ) (453 )
Payment of Dividends - (335,676 )
Purchase of Treasury Shares (3,086 ) -
Proceeds from Stock Option Exercises and Related Tax Benefits 929 2,248
Excess Tax Benefit from Stock Based Compensation 4,023 -
Deferred Financing Costs   (264 )   (22,126 )
Net Cash Used in Financing Activities   (60,839 )   (185 )
Decrease in Cash and Cash Equivalents (103,693 ) (9,929 )
Cash and Cash Equivalents at Beginning of Period   132,984     43,336  
Cash and Cash Equivalents at End of Period $ 29,291   $ 33,407  
 
Supplemental Disclosure of Cash Flow Information
Interest Paid $ 49,528   $ 48,053  
Income Tax Payments - Net $ 73,177   $ 1,632  
Accretion of Class L Preferred Return $ -   $ 78,366  
 
Non-Cash Investing Activities:
Accrued Purchases of Property and Equipment $ 25,082   $ 21,861  
Acquisition of Capital Lease $ 5,302   $ 887  

Adjusted Net Income (Loss), Adjusted Net Income (Loss) per Share and Adjusted EBITDA

The following tables calculate the Company’s Adjusted Net Income (Loss), Adjusted Net Income (Loss) Per Share and Adjusted EBITDA (earnings before net interest expense and loss on extinguishment of debt, taxes, depreciation, amortization and impairment, stock option modification expense, advisory fees and costs related to debt amendments, secondary offering and other), all of which are considered Non-GAAP financial measures. Generally, a Non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP.

Adjusted Net Income (Loss) is defined as consolidated net income (loss) for the period plus (i) net favorable lease amortization, (ii) costs related to debt amendments, secondary offering and other, (iii) loss on the extinguishment of debt, (iv) impairment charges, (v) advisory fees and (vi) stock option modification expense, all of which are tax effected to arrive at Adjusted Net Income (Loss).

Adjusted Net Income (Loss) per Share is defined as Adjusted Net Income (Loss) divided by the weighted average shares outstanding, as defined in the table below.

The Company presents Adjusted Net Income (Loss), Adjusted Net Income (Loss) per Share and Adjusted EBITDA because it believes they are useful supplemental measures in evaluating the performance of the business and provide greater transparency into the results of operations. In particular, the Company believes that excluding certain items that may vary substantially in frequency and magnitude from operating income are useful supplemental measures that assist in evaluating the Company’s ability to generate earnings and leverage sales, and to more readily compare these metrics between past and future periods.

The Company believes that Adjusted Net Income (Loss), Adjusted Net Income (Loss) per Share and Adjusted EBITDA provide investors helpful information with respect to the Company’s operations and financial condition. Other companies in the retail industry may calculate these non-GAAP measures differently such that the Company’s calculation may not be directly comparable. The adjustments to these metrics are not in accordance with regulations adopted by the SEC that apply to periodic reports presented under the Exchange Act. Accordingly, Adjusted Net Income (Loss), Adjusted Net Income (Loss) per Share and Adjusted EBITDA may be presented differently in filings made with the SEC than as presented in this report or not presented at all.

The following table shows the Company’s reconciliation of Net Income (Loss) to Adjusted Net Income (Loss) for the six and three months ended August 2, 2014 compared with the six and three months ended August 3, 2013:

  (unaudited)
(in thousands, except per share data)
             
Six Months Ended   Three Months Ended
August 2,   August 3, August 2,   August 3,
2014 2013 2014 2013
Reconciliation of Net Income (Loss)

to Adjusted Net Income (Loss):

Net Income (Loss) $ 5,304 $ (30,577 ) $ (6,470 ) $ (25,014 )
Net Favorable Lease Amortization (a) 13,106 15,665 6,535 6,835
Costs Related to Debt Amendments,

Secondary Offering and Other (b)

1,341 11,457 917 2,603
Stock Option Modification Expense (c) 1,791 7,263 963 7,263
Loss on Extinguishment of Debt (d) 3,681 617 - 617
Impairment Charges (e) 848 139 829 88
Advisory Fees (f) 126 2,175 60 1,103
Tax Effect (g)   (8,462 )   (14,180 )   (3,711 )   (7,071 )
Adjusted Net Income (Loss) $ 17,735   $ (7,441 ) $ (877 ) $ (13,576 )
 
Weighted Average Shares

Outstanding (h)

75,585 72,599 73,966 72,896
Adjusted Net Income (Loss)

Per Share

$ 0.23   $ (0.10 ) $ (0.01 ) $ (0.19 )

(a) Net favorable lease amortization represents the non-cash amortization expense associated with favorable and unfavorable leases that were recorded as a result of purchase accounting related to the acquisition of BCFWC on April 13, 2006 by affiliates of Bain Capital Partners, LLC (along with its associated investment funds, or any successor to its investment management business, Bain Capital) in a take private transaction, and are recorded in the line item “Depreciation and Amortization” in our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

(b) Costs are primarily related to the Secondary Offering in Fiscal 2014 and advisory and professional fees associated with Amendments No. 2 and No. 3 to our Senior Secured Term Loan Credit Agreement in February and May 2013, respectively.

(c) Represents expenses incurred as a result of our May 2013 stock option modification.

(d) For Fiscal 2014, amounts represent losses incurred in accordance with ASC Topic No. 405-20, “Extinguishments of Liabilities,” related to the April 2014 partial redemption of our Holdco Notes and the excess cash flow payment of our Term Loan Facility. For Fiscal 2013, amounts relate to Amendment No. 3 to the Term Loan Credit Agreement.

(e) Represents impairment charges on long lived assets.

(f) For Fiscal 2014, amounts represent reimbursement for out-of-pocket fees and expenses that are payable to Bain Capital. For Fiscal 2013, amounts primarily represent the annual advisory fee of Bain Capital expensed during the fiscal periods in connection with our advisory agreement with Bain Capital which was terminated on October 2, 2013 in connection with our initial public offering. All amounts are recorded in the line item “Selling and Administrative Expenses” in our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

(g) Tax effect is calculated based on the effective tax rates (before discrete items) for the respective periods, adjusted for the tax effect for the impact of items (a) through (f).

(h) Pro Forma Weighted Average Shares Outstanding give effect to (i) the cancellation of all existing Class A common stock, (ii) the conversion of the Company’s Class L common stock into Class A common stock, (iii) the 11-for-1 split of the Company’s Class A common stock, (iv) the reclassification of the Company’s Class A common stock and (v) the issuance of 15,333,333 common shares associated with the Company’s initial public offering as if it occurred on February 3, 2013.

The following table shows the Company’s reconciliation of Net Income (Loss) to Adjusted EBITDA for the six and three months ended August 2, 2014 compared with the six and three months ended August 3, 2013:

    (unaudited)
(in thousands)
             
Six Months Ended   Three Month Ended
August 2,   August 3, August 2,   August 3,
2014 2013 2014   2013  
Reconciliation of Net Income (Loss)

to Adjusted EBITDA:

Net Income (Loss) $ 5,304 $ (30,577 ) $ (6,470 ) $ (25,014 )
Interest Expense 52,098 67,630 25,546 33,327
Interest Income (24 ) (165 ) (12 ) (90 )
Loss on Extinguishment of Debt (d) 3,681 617 - 617
Costs Related to Debt Amendments,

Secondary Offering and Other (b)

1,341 11,457 917 2,603
Stock Option Modification Expense (c) 1,791 7,263 963 7,263
Advisory Fees (f) 126 2,175 60 1,103
Depreciation and Amortization 81,757 85,239 40,549 41,247
Impairment Charges 848 139 829 88
Tax Expense (Benefit)   3,493     (17,307 )   (4,293 )   (14,223 )
Adjusted EBITDA $ 150,415   $ 126,471   $ 58,089   $ 46,921  

Source: Burlington Stores, Inc.

Investor Relations:

Burlington Stores, Inc.

Robert L. LaPenta, Jr., 855-973-8445

Info@BurlingtonInvestors.com

or

ICR, Inc.

Allison Malkin/Alison MacQuarrie, 203-682-8225