Orchard Supply Hardware Stores Corporation Announces Update on Progress with Key Operating and Financial Initiatives under Long-Term Repositioning Strategy
Orchard Supply Hardware Stores Corporation (Nasdaq: OSH), a neighborhood hardware and garden store focused on paint, repair and the backyard, today announced continuing progress with its key operating and financial initiatives under Orchard's repositioning strategy:
- We reduced our debt by more than $90 million during the past 12 months and secured financing for store remodels, primarily by executing multiple sale-leaseback transactions;
- We successfully refinanced our Senior Secured Credit Facility earlier this month, which enabled us to increase our borrowing capacity at a lower cost and, as a result, have strengthened our liquidity position. As of October 27, 2012, the Company had approximately $64 million of cash and credit available;
- With the completion and re-opening of three remodeled stores in October, we now have 8 stores in our new neighborhood format and are pleased with the positive results thus far;
- We have a seasoned team of executives with deep retail expertise, including Samantha Osselaer who will be joining us on November 5th as the Company's new Vice President of Marketing;
- As previously announced, we engaged Moelis & Co. to lead us in the refinancing efforts of our Senior Secured Term Loan. As a first step in this process, the Company obtained a short-term waiver from our current term loan lenders related to compliance with the leverage ratio covenant for the October 27, 2012 measurement period. Additional information related to the waiver was filed on Form 8-K today with the SEC.
Orchard President and Chief Executive Officer, Mark Baker, stated, “I am pleased that we continue to make significant progress against our initiatives and greatly appreciate the support of our lenders as we work over the next several weeks to continue to strengthen Orchard's financial position.”
The Company also announced the appointment of retail veteran Samantha Osselaer, 48, to the newly created position of Vice President, Marketing, effective November 5, 2012. Osselaer will lead marketing strategies that will help support the Company's continuing repositioning efforts. She will report directly to Mr. Baker. Osselaer comes to Orchard with over 20 years of experience in multi-channel retail marketing, brand strategy, print and broadcast advertising and e-commerce development.
Mr. Baker added, “We are thrilled to have Sam join us and believe she will bring tremendous value to our repositioning efforts. As we begin to more aggressively roll out our new neighborhood store format, we felt this was the ideal time to bring in additional expertise and creativity to assist us with branding and marketing. Thus far in fiscal 2012, we have opened two new stores and completed three full-scale remodels. A fourth location, Pismo Beach, will celebrate its grand re-opening on November 10, 2012 following an extensive transformation. We are pleased that our newly opened and remodeled stores are generating positive results and look forward to continuing to roll out the concept.”
Prior to joining Orchard, Ms. Osselaer was Senior Director, Creative & Branding with online retailer Overstock.com. Previously, she served as VP, Brand Creative at Frontgate and VP and Creative Director for both Smith & Hawken and Macy's. She began her career as Art Director/Designer/Production Manager with Guess, Inc., and then served as Vice President and Associate Creative Director for advertising agency Foote, Cone & Belding, where clients included Levi Strauss, L'Oreal, and Mattel. Ms. Osselaer has won numerous advertising awards, including the CLIO, the Belding and the ADDY. She holds a BFA in Graphic Design from the University of Arizona.
Orchard Supply Hardware Stores Corporation is a neighborhood hardware and garden store focused on paint, repair and the backyard. Founded as a purchasing cooperative in San Jose in 1931, today the stores average 44,000 square feet of enclosed retail space and 8,000 square feet of exterior nursery and garden space, carrying a broad assortment of merchandise for repair, maintenance and improvement needs for the home and backyard. As of October 17, 2012, the Company had 89 stores in California. For more information, visit http://osh.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:
This press release (including information incorporated or deemed incorporated by reference herein) contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those involving future events and future results that are based on current expectations, estimates, forecasts, and projections as well as the current beliefs and assumptions of the Company's management. Words such as “guidance”, “outlook”, “believes”, “expects”, “appears”, “may”, “will”, “should”, “intend”, “target”, “projects”, “estimates”, “plans”, “forecast”, “is likely to”, “anticipates”, or the negative thereof or comparable terminology, are intended to identify such forward looking statements. Any statement that is not a historical fact and other estimates, projections, future trends and the outcome of events that have not yet occurred referenced in this press release, is a forward-looking statement. Forward-looking statements are only predictions and are subject to risks, uncertainties and assumptions that are difficult to predict. Therefore actual results may differ materially and adversely from those expressed in any forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, factors discussed under the section entitled “Risk Factors” in the Company's reports filed with the Securities and Exchange Commission. Many of such factors relate to events and circumstances that are beyond the Company's control. You should not place undue reliance on forward-looking statements. The Company does not assume any obligation to update the information contained in this press release.
The Blueshirt Group
Christine Greany, 858-523-1732 (Investor Relations)