The Michaels Companies, Inc. (NASDAQ:MIK) Q2 2017 Earnings Conference Call - Preliminary Transcript

Aug 24, 2017 • 09:00 am ET

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The Michaels Companies, Inc. (NASDAQ:MIK) Q2 2017 Earnings Conference Call - Preliminary Transcript

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Presentation
Operator
Operator

Good morning. My name is Anita and I will be your Conference Operator Today. At this time, we'd like to Welcome everyone to

The Michaels Companies Earnings Conference Call for the Second Quarter of Fiscal 2017. All lines have been placed on mute to

prevent any background noise. (Operator Instructions). Please note this event is being recorded. Thank you.

And now, I'd like to turn the call over to your host, Kiley Rawlins, Vice President of Investor Relations and Communications.

Ms. Rawlins, you may begin the conference.

Executive
Kiley Rawlins

Thank you, Anita. Good morning everyone and thank you for joining us today. Earlier this morning, we released our second quarter financial results. A copy of the press release is available in the Investor Relations section of our website at www.michaels.com.

Before we begin our discussion, let me remind you that today's press release and the presentations made by our executives on this call may constitute forward-looking statements and are made pursuant to and within the meaning of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995 as amended. While these statements address plans or events which we expect will or may occur in the future, a number of factors, as set forth in our SEC filings and press releases, could cause actual results to differ materially from our expectations.

We refer you to and specifically incorporate the cautionary and risk statement contained in today's press release and in our SEC filings. You are cautioned not to place undue reliance on these forward-looking statements which speak only as of today, August 24, 2017. We have no obligation to update or revise our forward-looking statements except as required by law and you should not expect us to do so.

In today's earnings release, we have presented non-GAAP financial measures such as adjusted EBITDA, as defined in our credit agreement; adjusted operating income; adjusted net income; and adjusted diluted earnings per share.

Adjusted operating income, adjusted net income and adjusted diluted earnings per share have been presented to reflect our view of our ongoing operations by adjusting for non-recurring inventory related purchase accounting adjustment and non-recurring integration costs and benefits associated with the February 2016 acquisition of Lamrite West. A reconciliation of these measures to the corresponding GAAP measures can be found in today's earnings release.

Our call today will begin with highlights from Chuck Rubin, Chairman and CEO and then, Denise Paulonis, our CFO, will review our financial results and outlook in more detail. Following our prepared remarks, the call will be opened for questions. As a reminder, we would appreciate it if participants could limit themselves to one question and one follow-up question.

I'll now turn the call over to Chuck Rubin. Chuck?

Executive
Chuck Rubin

Good morning. Thank you, Kiley. This morning we reported record sales and earnings per share for the second quarter which was above our original guidance. For the total quarter, total sales increased 1.2% or 1.3% on a constant currency basis. Comparable store sales increased 0.6% or 0.8%