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conn-20230830
FALSE000122338900012233892023-08-302023-08-30

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K 
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): August 30, 2023
CONN’S, INC.
(Exact name of registrant as specified in its charter)
Delaware001-3495606-1672840
(State or other jurisdiction of
incorporation)		(Commission File Number)(IRS Employer Identification No.)
2445 Technology Forest Blvd., Suite 800,
The Woodlands, TX
77381
(Address of principal executive offices)(Zip Code)
Registrant’s telephone number, including area code:  (936) 230-5899
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading SymbolName of Each Exchange on Which Registered
Common Stock, par value $0.01 per shareCONNNASDAQ Global Select Market
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act o



Item 2.02. Results of Operations and Financial Condition.
On August 30, 2023, Conn’s, Inc. issued a press release reporting its second quarter fiscal year 2024 financial results. A copy of the press release is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.
None of the information contained in Item 2.02 or Exhibit 99.1 of this Form 8-K shall be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and none of it shall be incorporated by reference in any filing under the Securities Act of 1933, as amended. Furthermore, this report will not be deemed an admission as to the materiality of any information in the report that is required to be disclosed solely by Regulation FD.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No.Description
99.1*
104Cover Page Interactive Data File (formatted as Inline XBRL)

* Furnished herewith



SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
CONN’S, INC.
Date:August 30, 2023By:/s/ George L. Bchara
Name:George L. Bchara
Title:
Executive Vice President and Chief Financial Officer
Document

Exhibit 99.1
https://cdn.kscope.io/961843c884a9ab98fde942fde5a604ec-connshomepluslogoa26.jpg
Conn’s, Inc. Reports Second Quarter Fiscal Year 2024 Financial Results
THE WOODLANDS, Texas, August 30, 2023 - Conn’s, Inc. (NASDAQ: CONN) (“Conn’s” or the “Company”), a specialty retailer of home goods, including furniture and mattresses, appliances, and consumer electronics, today announced its financial results for the quarter ended July 31, 2023.
“Strategic initiatives focused on turning around our retail performance and better serving our core credit-constrained consumers are taking hold and continue to perform in line with our expectations. During the second quarter, we experienced improving sales trends in our Conn’s in-house and lease-to-own offerings and record quarterly eCommerce revenue. In addition, the recent enhancements to our marketing strategies and credit application process drove a 30.6% increase in applications during the second quarter, which resulted in an increase in sales financed through Conn’s in-house credit offering,” stated Norm Miller, Interim President and Chief Executive Officer.
“Retail gross margin grew 230 basis points over the prior year period to the highest level in seven quarters, as we benefit from pricing and assortment changes we have made since the end of last year. In addition, credit quality remains stable and in line with our expectations. As we navigate a fluid economic environment, we continue to leverage our powerful value proposition to serve our core credit-constrained consumers and drive sales, while remaining focused on improving profitability and controlling credit risk,” concluded Mr. Miller.
"Under Norm's leadership, the Company has quickly moved to stabilize performance throughout a challenging macro-economic environment. Conn's return to a strategy focused on serving the core credit-constrained customer is turning around retail performance and repositioning the business for growth. The Board is confident in the direction Conn’s is headed and believes the Company is well positioned to create lasting value for shareholders,” added Bob Martin, lead independent director.
Second Quarter Financial Highlights as Compared to the Prior Fiscal Year Period (Unless Otherwise Noted):
•Total consolidated revenue declined 11.5% to $306.9 million, due to a 12.8% decline in total net sales, and a 5.5% reduction in finance charges and other revenues;
•Same store sales decreased 15.4%, which is the third quarter of sequential improvement and an over 1,000 basis point improvement from last year’s third quarter;
•eCommerce sales increased 41.5% to a second quarter record of $27.2 million;
•Retail gross margin increased to 36.9% from 34.6% in the prior year;
•Credit applications increased by 30.6% year-over-year, which resulted in the first quarter of positive sales financed through Conn’s in-house credit offering in six quarters;
•Reported a net loss of $1.39 per diluted share, compared to net income of $0.09 per diluted share for the same period last fiscal year; and
•The Company improved its capital position and access to liquidity by closing a $50 million Delayed Draw Term Loan on July 31, 2023 and closing a $273.7 million asset-backed security (ABS) transaction on August 17, 2023 demonstrating the Company’s ability to access the capital markets even during volatile market conditions.

Second Quarter Results
Net loss for the three months ended July 31, 2023 was $33.5 million, or $1.39 per diluted share, compared to net income for the three months ended July 31, 2022 of $2.1 million, or $0.09 per diluted share or adjusted net income of $1.0 million, or $0.04 per diluted share. There were no non-GAAP adjustments for the three months ended July 31, 2023.

Retail Segment Second Quarter Results
Retail revenues were $246.3 million for the three months ended July 31, 2023 compared to $279.8 million for the three months ended July 31, 2022, a decrease of $33.4 million or 12.0%. The decrease in retail revenue was primarily driven by a decrease in same store sales of 15.4%. The decrease in same store sales resulted from lower discretionary spending for home-related
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products following several periods of excess consumer liquidity resulting in the acceleration of sales. The decrease in same store sales was partially offset by new store growth.
For the three months ended July 31, 2023, retail segment operating loss was $10.4 million compared to retail segment operating income of $0.1 million for three months ended July 31, 2022. The decrease in retail segment operating income was primarily due to a decrease in revenue as described above, and higher selling, general and administrative costs ("SG&A"). This increase was partially offset by an improvement in retail gross margin.
Retail gross margin for the three months ended July 31, 2023 was 36.9%, an increase of 230 basis points from the reported 34.6% for the three months ended July 31, 2022. The increase in retail gross margin was primarily driven by pricing and assortment changes, a more profitable product mix and normalizing freight costs. The increase was partially offset by the deleveraging of fixed distribution costs.
SG&A for the retail segment during the three months ended July 31, 2023 was $101.4 million compared to SG&A for the retail segment of $98.0 million for the three months ended July 31, 2022. The SG&A increase in the retail segment was primarily due to an increase in occupancy from new stores, partially offset by a decline in variable costs and a decline in labor costs as a result of cost savings initiatives.
The following table presents net sales and changes in net sales by category:
Three Months Ended July 31,Same Store
(dollars in thousands)2023% of Total2022% of TotalChange% Change% Change
Furniture and mattress$81,267 33.1 %$86,320 30.9 %$(5,053)(5.9)%(10.2)%
Home appliance90,584 36.8 120,748 43.2 (30,164)(25.0)(27.2)
Consumer electronics26,941 11.0 31,860 11.4 (4,919)(15.4)(17.7)
Home office8,982 3.7 8,857 3.2 125 1.4 (1.1)
Other17,034 6.9 7,664 2.7 9,370 122.3 100.6 
Product sales224,808 91.5 255,449 91.4 (30,641)(12.0)(15.5)
Repair service agreement commissions (1)
18,757 7.6 21,615 7.7 (2,858)(13.2)(14.3)
Service revenues2,274 0.9 2,448 0.9 (174)(7.1)
Total net sales$245,839 100.0 %$279,512 100.0 %$(33,673)(12.0)%(15.4)%
(1) The total change in sales of repair service agreement commissions includes retrospective commissions, which are not reflected in the change in same store sales.

Credit Segment Second Quarter Results
Credit revenues were $63.1 million for the three months ended July 31, 2023 compared to $66.8 million for the three months ended July 31, 2022, a decrease of $3.7 million or 5.5%. The decrease in credit revenue was primarily due to a 6.4% decrease in the average outstanding balance of the customer accounts receivable portfolio. The decrease was partially offset by an increase in insurance commissions and late fee revenues.
Provision for bad debts increased to $33.2 million for the three months ended July 31, 2023 from $26.8 million for the three months ended July 31, 2022, an overall change of $6.4 million. The year-over-year increase was primarily driven by a year-over-year increase in net charge-offs of $2.7 million during the three months ended July 31, 2023 compared to the three months ended July 31, 2022. For the three months ended July 31, 2023, the allowance for bad debts was reduced by $5.6 million compared to a reduction in the allowance for bad debts of $9.3 million for the three months ending July 31, 2022. This resulted in an increase to the provision for bad debts of $3.7 million and was due primarily to a smaller decline in the customer accounts receivable portfolio balance in the current period.
Credit segment operating loss was $4.5 million for the three months ended July 31, 2023, compared to operating income of $7.9 million for the three months ended July 31, 2022.  The decrease was primarily due to the increase in the provision for bad debts and the decrease in credit revenue.
Additional information on the credit portfolio and its performance may be found in the Customer Accounts Receivable Portfolio Statistics table included within this press release and in the Company’s Form 10-Q for the quarter ended July 31, 2023, to be filed with the Securities and Exchange Commission on August 30, 2023 (the “Second Quarter Form 10-Q”).

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Store and Facilities Update
The Company opened four new standalone stores during the second quarter of fiscal year 2024 bringing the total store count to 175 in 15 states. During fiscal year 2024, the Company plans to open a total of ten standalone locations.

Liquidity and Capital Resources
On July 31, 2023, the Company entered into a $50.0 million three-year Delayed Draw Term Loan with Stephens Investments Holding, LLC and Stephens Group, LLC. Proceeds from borrowings made under the Delayed Draw Term Loan Agreement may be used by the Company for general corporate purposes. The Delayed Draw Term Loan is secured by liens on substantially all of the assets of the Company and its subsidiaries.
On August 17, 2023, the Company completed an ABS transaction resulting in the issuance and sale of $273.7 million aggregate principal amount of Class A, Class B and Class C Notes secured by customer accounts receivables and restricted cash held by a consolidated VIE, which resulted in net proceeds of $266.2 million, net of debt issuance costs.
As of July 31, 2023, the Company had $181.1 million of immediately available borrowing capacity under its $650.0 million revolving credit facility. In addition, the Company had $50.0 million of borrowing capacity available under the Delayed Draw Term Loan resulting in a total immediately available borrowing capacity of $231.1 million. The Company also had $8.6 million of unrestricted cash available for use.

Conference Call Information
The Company will host a conference call on August 30, 2023, at 10 a.m. CT / 11 a.m. ET, to discuss its three months ended July 31, 2023 financial results. Participants can join the call by dialing 877-451-6152 or 201-389-0879. The conference call will also be broadcast simultaneously via webcast on a listen-only basis. A link to the earnings release, webcast and second quarter fiscal year 2024 conference call presentation will be available at ir.conns.com.
Replay of the telephonic call can be accessed through September 6, 2023 by dialing 844-512-2921 or 412-317-6671 and Conference ID: 13738737.
About Conn’s, Inc.
Conn's HomePlus (NASDAQ: CONN) is a specialty retailer of home goods, including furniture and mattresses, appliances and consumer electronics. With 175 stores across 15 states and online at Conns.com, our approximately 4,000 employees strive to help all customers create a home they love through access to high-quality products, next-day delivery and personalized payment options, including our flexible, in-house credit program. Additional information can be found by visiting our investor relations website at https://ir.conns.com and social channels (@connshomeplus on Twitter, Instagram, Facebook and LinkedIn).
This press release contains forward-looking statements within the meaning of the federal securities laws, including, but not limited to, the Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties. Such forward-looking statements include information concerning our future financial performance, business strategy, plans, goals and objectives. Statements containing the words “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “project,” “should,” “predict,” “will,” “potential,” or the negative of such terms or other similar expressions are generally forward-looking in nature and not historical facts. Such forward-looking statements are based on our current expectations. We can give no assurance that such statements will prove to be correct, and actual results may differ materially. A wide variety of potential risks, uncertainties, and other factors could materially affect our ability to achieve the results either expressed or implied by our forward-looking statements, including, but not limited to: general economic conditions impacting our customers or potential customers; our ability to execute periodic securitizations of future originated customer loans on favorable terms; our ability to continue existing customer financing programs or to offer new customer financing programs; changes in the delinquency status of our credit portfolio; unfavorable developments in ongoing litigation; increased regulatory oversight; higher than anticipated net charge-offs in the credit portfolio; the success of our planned opening of new stores; expansion of our e-commerce business; technological and market developments and sales trends for our major product offerings; our ability to manage effectively the selection of our major product offerings; our ability to protect against cyber-attacks or data security breaches and to protect the integrity and security of individually identifiable data of our customers and employees; our ability to fund our operations, capital expenditures, debt repayment and expansion from cash flows from operations, borrowings from our Revolving Credit Facility or our Delayed Draw Term Loan; and proceeds from accessing debt or equity markets; the effects of epidemics or pandemics, including the COVID-19 pandemic; and other risks detailed in Part I, Item 1A, Risk Factors, in our Annual Report on Form 10-K for the fiscal year ended January 31, 2023 and other reports filed with the Securities and Exchange Commission. If one or more of these or other risks or uncertainties materialize (or the consequences of such a development changes), or should our underlying assumptions prove incorrect, actual outcomes may vary materially from those reflected in our forward-looking statements. You are cautioned not to place undue reliance on these forward-looking
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statements, which speak only as of the date of this press release. We disclaim any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events or otherwise, or to provide periodic updates or guidance. All forward-looking statements attributable to us, or to persons acting on our behalf, are expressly qualified in their entirety by these cautionary statements.
CONN-G
S.M. Berger & Company
Andrew Berger (216) 464-6400

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CONN’S, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(dollars in thousands, except per share amounts)
Three Months Ended
July 31,		Six Months Ended
July 31,
2023202220232022
Revenues:
Total net sales$243,645 $279,512 $466,192 $551,775 
Finance charges and other revenues63,261 67,120 125,284 134,677 
Total revenues306,906 346,632 591,476 686,452 
Costs and expenses:
Cost of goods sold153,985 182,718 301,918 361,100 
Selling, general and administrative expense134,974 130,142 264,212 262,925 
Provision for bad debts33,302 27,226 62,211 41,956 
Charges and credits, net— (1,484)(807)(1,484)
Total costs and expenses322,261 338,602 627,534 664,497 
Operating (loss) income(15,355)8,030 (36,058)21,955 
Interest expense16,787 6,808 33,166 12,329 
(Loss) income before income taxes(32,142)1,222 (69,224)9,626 
Provision (benefit) for income taxes1,375 (907)(327)1,276 
Net (loss) income $(33,517)$2,129 $(68,897)$8,350 
(Loss) income per share:
Basic$(1.39)$0.09 $(2.85)$0.34 
Diluted$(1.39)$0.09 $(2.85)$0.34 
Weighted average common shares outstanding:
Basic24,190,035 23,833,100 24,162,550 24,306,524 
Diluted24,190,035 23,916,269 24,162,550 24,461,836 

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CONN’S, INC. AND SUBSIDIARIES
CONDENSED RETAIL SEGMENT FINANCIAL INFORMATION
(unaudited)
(dollars in thousands)
Three Months Ended
July 31,		Six Months Ended
July 31,
2023202220232022
Revenues:
Product sales$224,808 $255,449 $429,231 $505,422 
Repair service agreement commissions18,757 21,615 35,662 41,452 
Service revenues2,274 2,448 4,432 4,901 
Total net sales245,839 279,512 469,325 551,775 
Finance charges and other497 273 1,015 544 
Total revenues246,336 279,785 470,340 552,319 
Costs and expenses:
Cost of goods sold155,242 182,718 303,804 361,100 
Selling, general and administrative expense101,420 98,035 197,245 194,065 
Provision for bad debts93 409 199 588 
Charges and credits, net— (1,484)(1,184)(1,484)
Total costs and expenses256,755 279,678 500,064 554,269 
Operating (loss) income $(10,419)$107 $(29,724)$(1,950)
Retail gross margin36.9 %34.6 %35.3 %34.6 %
Selling, general and administrative expense as percent of revenues41.2 %35.0 %41.9 %35.1 %
Operating margin(4.2)%— %(6.3)%(0.4)%
Store count:
Beginning of period171 161 168 158 
Opened4 2 7 5 
End of period 175 163 175 163 

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CONN’S, INC. AND SUBSIDIARIES
CONDENSED CREDIT SEGMENT FINANCIAL INFORMATION
(unaudited)
(dollars in thousands)
Three Months Ended
July 31,		Six Months Ended
July 31,
2023202220232022
Revenues:
Finance charges and other revenues$63,091 $66,847 $124,878 $134,133 
Costs and expenses:
Cost of goods sold$579 — 694 — 
Selling, general and administrative expense33,804 32,107 67,467 68,860 
Provision for bad debts33,209 26,817 62,012 41,368 
Total costs and expenses67,592 58,924 130,173 110,228 
Operating (loss) income(4,501)7,923 (5,295)23,905 
Interest expense16,680 6,808 33,059 12,329 
(Loss) income before income taxes$(21,181)$1,115 $(38,354)$11,576 
Selling, general and administrative expense as percent of revenues53.6 %48.0 %54.0 %51.3 %
Selling, general and administrative expense as percent of average outstanding customer accounts receivable balance (annualized)13.7 %12.2 %13.6 %12.8 %
Operating margin(7.1)%11.9 %(4.2)%17.8 %

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CONN’S, INC. AND SUBSIDIARIES
CUSTOMER ACCOUNTS RECEIVABLE PORTFOLIO STATISTICS
(unaudited)
As of July 31,
20232022
Weighted average credit score of outstanding balances (1)
615 611 
Average outstanding customer balance$2,645 $2,508 
Balances 60+ days past due as a percentage of total customer portfolio carrying value (2)(3)
11.1 %11.0 %
Re-aged balance as a percentage of total customer portfolio carrying value (2)(3)
15.9 %16.1 %
Carrying value of account balances re-aged more than six months (in thousands)(3)
$31,085 $35,808 
Allowance for bad debts and uncollectible interest as a percentage of total customer accounts receivable portfolio balance16.6 %17.2 %
Percent of total customer accounts receivable portfolio balance represented by no-interest option receivables
35.9 %34.0 %
Three Months Ended
July 31,		Six Months Ended
July 31,
2023202220232022
Total applications processed 341,118 257,381 634,949 525,085 
Weighted average origination credit score of sales financed (1)
623 620 621 620 
Percent of total applications approved and utilized21.5 %23.5 %20.6 %21.8 %
Average income of credit customer at origination$52,600 $50,800 $51,800 $50,500 
Percent of retail sales paid for by:  
In-house financing, including down payments received62.2 %52.1 %60.7 %51.0 %
Third-party financing14.1 %18.9 %14.7 %18.4 %
Third-party lease-to-own option8.0 %6.8 %8.1 %7.1 %
 84.3 %77.8 %83.5 %76.5 %
(1)Credit scores exclude non-scored accounts.
(2)Accounts that become delinquent after being re-aged are included in both the delinquency and re-aged amounts.
(3)Carrying value reflects the total customer accounts receivable portfolio balance, net of deferred fees and origination costs, the allowance for no-interest option credit programs and the allowance for uncollectible interest.

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CONN’S, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
July 31, 2023January 31, 2023
Assets(unaudited)
Current Assets:
Cash and cash equivalents$8,560 $19,534 
Restricted cash29,020 40,837 
Customer accounts receivable, net of allowances426,223 421,683 
Other accounts receivable62,437 56,887 
Inventories234,478 240,783 
Income taxes receivable38,976 38,436 
Prepaid expenses and other current assets13,962 12,937 
Total current assets813,656 831,097 
Long-term portion of customer accounts receivable, net of allowances368,238 389,054 
Property and equipment, net221,881 218,956 
Operating lease right-of-use assets284,457 262,104 
Other assets13,971 15,004 
Total assets$1,702,203 $1,716,215 
Liabilities and Stockholders’ Equity
Current liabilities:
Short-term debt and current finance lease obligations$9,039 $937 
Accounts payable72,451 71,685 
Accrued expenses92,287 82,619 
Operating lease liability - current60,294 53,208 
Other current liabilities13,675 13,912 
Total current liabilities247,746 222,361 
Operating lease liability - non current349,654 331,109 
Long-term debt and finance lease obligations639,950 636,079 
Deferred tax liability1,952 2,041 
Other long-term liabilities23,579 22,215 
Total liabilities1,262,881 1,213,805 
Stockholders’ equity439,322 502,410 
Total liabilities and stockholders’ equity$1,702,203 $1,716,215 

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CONN’S, INC. AND SUBSIDIARIES
NON-GAAP RECONCILIATIONS
(unaudited)
(dollars in thousands, except per share amounts)

Basis for presentation of non-GAAP disclosures:
To supplement the Condensed Consolidated Financial Statements, which are prepared and presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”), the Company also provides the following non-GAAP financial measures: retail segment adjusted operating loss, adjusted net (loss) income, adjusted net (loss) earnings per diluted share and net debt as a percentage of the portfolio balance. These non-GAAP financial measures are not meant to be considered as a substitute for, or superior to, comparable GAAP measures and should be considered in addition to results presented in accordance with GAAP. They are intended to provide additional insight into our operations and the factors and trends affecting the business. Management believes these non-GAAP financial measures are useful to financial statement readers because (1) they allow for greater transparency with respect to key metrics we use in our financial and operational decision making and (2) they are used by some of our institutional investors and the analyst community to help them analyze our operating results.

RETAIL SEGMENT ADJUSTED OPERATING LOSS
Three Months Ended
July 31,		Six Months Ended
July 31,
2023202220232022
Retail segment operating (loss) income, as reported$(10,419)$107 $(29,724)$(1,950)
Adjustments:
Store closure (1)
— — 2,340 — 
Asset sale (2)
— — (3,147)— 
Lease termination (3)
— (1,484)— (1,484)
Retail segment operating loss, as adjusted$(10,419)$(1,377)$(30,531)$(3,434)

(1)Represents store closure costs due to the impairment of assets associated with the decision to end the store-within-a-store test with Belk, Inc.
(2)Represents a gain related to the sale of a single store location, net of asset disposal costs.
(3)Represents a gain on the termination of a lease.

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ADJUSTED NET (LOSS) INCOME AND ADJUSTED NET (LOSS) INCOME PER DILUTED SHARE
Three Months Ended
July 31,		Six Months Ended
July 31,
2023202220232022
Net (loss) income, as reported$(33,517)$2,129 $(68,897)$8,350 
Adjustments:
Store closure (1)
— — 2,340 — 
Asset sale (2)
— — (3,147)— 
Lease termination (3)
— (1,484)— (1,484)
Tax impact of adjustments(4)
— 337 705 337 
Net (loss) income, as adjusted$(33,517)$982 $(68,999)$7,203 
Weighted average common shares outstanding - Diluted24,190,035 23,916,269 24,162,550 24,461,836 
Net (loss) earnings per share:
As reported$(1.39)$0.09 $(2.85)$0.34 
As adjusted$(1.39)$0.04 $(2.86)$0.29 
(1)Represents store closure costs due to the impairment of assets associated with the decision to end the store-within-a-store test with Belk, Inc.
(2)Represents a gain related to the sale of a single store location, net of asset disposal costs.
(3)Represents a gain on the termination of a lease.
(4)Represents the tax effect of the adjusted items based on the applicable statutory tax rate.


NET DEBT
July 31,
20232022
Debt, as reported
Current finance lease obligations and other$9,039$909
Long-term debt and finance lease obligations639,950602,412
Total debt$648,989$603,321
Cash, as reported
Cash and cash equivalents$8,560$24,256
Restricted Cash29,02047,855
Total cash$37,580$72,111
Net debt$611,409$531,210
Ending portfolio balance, as reported$987,102$1,042,777
Net debt as a percentage of the portfolio balance61.9 %50.9 %
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