LONDON, UK / ACCESSWIRE / July 11, 2018 / If you want access to our free earnings report on The Michaels Cos., Inc. (NASDAQ: MIK), all you need to do is sign up now by clicking the following link www.active-investors.com/registration-sg/?symbol=MIK. Michaels Cos. reported its first quarter fiscal 2018 operating and financial results on June 12, 2018. The arts and crafts store operator's adjusted earnings rose 3%. Additionally, the Company provided guidance for the upcoming quarter and fiscal year. Register today and get access to over 1,000 Free Research Reports by joining our site below:

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Earnings Highlights and Summary

Michaels Cos.' net sales were $1.155 billion compared to $1.158 billion in Q1 FY17. The decline in net sales was primarily attributable to the closure of all 94 full-size Aaron Brothers' stores in the reported quarter. The Company's reported numbers topped analysts' estimates of $1.15 billion.

During Q1 FY18, Michaels Cos.' comparable store sales increased 0.4% on a y-o-y basis, driven by an increase in average ticket, partially offset by a decrease in customer transactions.

For Q1 FY18, Michaels Cos. recorded operating income of $78.9 million compared to $139.3 million in Q1 FY17. The decrease in operating income was attributed to a $47.5 million one-time restructuring charge, higher distribution-related costs, and occupancy cost deleverage during the reported quarter. Excluding the $47.5 million one-time restructuring charge and $0.3 million of operating profit from Aaron Brothers' operations prior to closure, Michaels Cos.' adjusted operating income totaled $126.1 million for Q1 FY18.

Michaels Cos. reported net income of $26.9 million, or $0.15 per diluted share, in Q1 FY18 compared to earnings of $72.2 million, or $0.38 per diluted share, in Q1 FY17.

Michaels Cos. reported adjusted diluted earnings of $0.39 per diluted share excluding approximately $0.20 per diluted share related to a one-time charge associated with the restructuring of the Aaron Brothers' division and approximately $0.04 per diluted share from provisional adjustments related to the Tax Cuts and Jobs Act of 2017. This compared to diluted earnings per share of $0.38 per share for Q1 FY17. The Company's earnings surpassed Wall Street's estimates of $0.38 per share.

Store Update

During Q1 FY18, the Company opened six new Michaels Cos.' stores, closed one Michaels Cos.'s store, and relocated nine Michaels Cos.' stores. At the end of the reported quarter, the Company operated 1,243 Michaels Cos.' stores, 3 Aaron Brothers' stores, and 36 Pat Catan's stores.

Outlook

For fiscal 2018, a 52-week year, Michaels Cos. is forecasting net sales to be in the range of $5.22 billion and $5.29 billion, and comparable store sales to grow between 0% and 1.5%. The Company is estimating adjusted operating income to be in the range of $677 million to $710 million, and adjusted earnings to be between $2.19 and $2.32 per share. In FY18, the Company expects to open 19 new Michaels Cos.' stores and relocate 17 Michaels Cos.' stores, and capital expenditures to be between $160 million and $170 million.

For the second quarter of fiscal 2018, Michaels Cos. is projecting comparable store sales to be approximately flat. The Company is anticipating adjusted operating income to be between $65 million and $70 million and adjusted earnings to be in the range of $0.12 and $0.14 per share. The Company expects to open six new Michaels stores and relocate eight Michaels stores in the upcoming quarter.

Stock Performance Snapshot

July 10, 2018 - At Tuesday's closing bell, The Michaels' stock slightly dropped 0.77%, ending the trading session at $20.51.

Volume traded for the day: 1.65 million shares.

Stock performance in the last month - up 0.39%; previous three-month period - up 6.93%; and past twelve-month period - up 14.39%

After yesterday's close, The Michaels' market cap was at $3.51 billion.

Price to Earnings (P/E) ratio was at 10.56.

The stock is part of the Services sector, categorized under the Specialty Retail, Other industry. This sector was up 0.1% at the end of the session.

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