chs-20221029

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM			10-Q


☑			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 29, 2022


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-16435



Chico's FAS, Inc.
(Exact name of registrant as specified in its charter)


Florida						59-2389435
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

11215 Metro Parkway, Fort Myers, Florida 33966

(Address of principal executive offices) (Zip Code)

239-277-6200

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, Par Value $0.01 Per Share	CHS	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer

☑

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

At November 14, 2022, the registrant had 125,069,318 shares of Common Stock, $0.01 par value per share, outstanding.

Table of Contents

CHICO'S FAS, INC. AND SUBSIDIARIES

QUARTERLY REPORT ON FORM 10-Q

FOR THE

FISCAL THIRTEEN AND THIRTY-NINE WEEKS ENDED OCTOBER 29, 2022

TABLE OF CONTENTS


PART I – Financial Information

Item 1.	Financial Statements:

	Condensed Consolidated Statements of Income for the Thirteen and Thirty-Nine Weeks Ended October 29, 2022 (Unaudited) and October 30, 2021 (Unaudited)	3

	Condensed Consolidated Statements of Comprehensive Income for the Thirteen and Thirty-Nine Weeks Ended October 29, 2022 (Unaudited) and October 30, 2021 (Unaudited)	4

	Condensed Consolidated Balance Sheets – October 29, 2022 (Unaudited), January 29, 2022 (Audited), and October 30, 2021 (Unaudited)	5

	Condensed Consolidated Statements of Shareholders’ Equity for the Thirteen and Thirty-Nine Weeks Ended October 29, 2022 (Unaudited) and October 30, 2021 (Unaudited)	6

	Condensed Consolidated Statements of Cash Flows for the Thirty-Nine Weeks Ended October 29, 2022 (Unaudited) and October 30, 2021 (Unaudited)	8

	Notes to Condensed Consolidated Financial Statements (Unaudited)	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	30

Item 4.	Controls and Procedures	30

PART II – Other Information

Item 1.	Legal Proceedings	31

Item 1A.	Risk Factors	31



Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	31



Item 6.	Exhibits	32

Signatures		33

Table of Contents

PART I – FINANCIAL INFORMATION


ITEM 1.			FINANCIAL STATEMENTS

CHICO'S FAS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(Dollars in thousands, except per share amounts)


	Thirteen Weeks Ended								Thirty-Nine Weeks Ended
	October 29, 2022				October 30, 2021				October 29, 2022				October 30, 2021

	Amount		% of Sales		Amount		% of Sales		Amount		% of Sales		Amount		% of Sales
Net Sales	$	518,332	100.0	%	$	453,644	100.0	%	$	1,617,967	100.0	%	$	1,313,664	100.0	%
Cost of goods sold	310,892		60.0		269,205		59.3		962,448		59.5		820,973		62.5
Gross Margin	207,440		40.0		184,439		40.7		655,519		40.5		492,691		37.5
Selling, general and administrative expenses	175,841		33.9		162,469		35.8		520,296		32.1		442,637		33.7



Income from Operations	31,599		6.1		21,970		4.9		135,223		8.4		50,054		3.8
Interest expense, net	(1,080)		(0.2)		(1,744)		(0.4)		(3,111)		(0.2)		(5,170)		(0.4)
Income before Income Taxes	30,519		5.9		20,226		4.5		132,112		8.2		44,884		3.4
Income tax provision	5,900		1.2		2,000		0.5		30,600		1.9		9,400		0.7
Net Income	$	24,619	4.7	%	$	18,226	4.0	%	$	101,512	6.3	%	$	35,484	2.7	%
Per Share Data:
Net income per common share - basic	$	0.20			$	0.15			$	0.84			$	0.30
Net income per common and common equivalent share – diluted	$	0.20			$	0.15			$	0.82			$	0.29
Weighted average common shares outstanding – basic	120,333				117,304				119,776				117,005
Weighted average common and common equivalent shares outstanding – diluted	124,887				123,166				124,016				121,897

The accompanying notes are an integral part of these condensed consolidated statements.

Table of Contents

CHICO'S FAS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(In thousands)


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 29, 2022		October 30, 2021		October 29, 2022		October 30, 2021
Net income	$	24,619	$	18,226	$	101,512	$	35,484
Other comprehensive loss:
Unrealized losses on marketable securities, net of taxes	(233)		(10)		(228)		(64)

Comprehensive income	$	24,386	$	18,216	$	101,284	$	35,420

The accompanying notes are an integral part of these condensed consolidated statements.

Table of Contents

CHICO'S FAS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands, except per share amounts)


	October 29, 2022		January 29, 2022		October 30, 2021
ASSETS
Current Assets:
Cash and cash equivalents	$	117,726	$	115,105	$	134,458
Marketable securities, at fair value	23,017		—		3,006
Inventories	304,127		323,389		277,738
Prepaid expenses and other current assets	47,208		41,871		51,841
Income tax receivable	15,430		13,698		13,125

Total Current Assets	507,508		494,063		480,168
Property and Equipment, net	183,153		195,332		199,853
Right of Use Assets	432,018		463,077		494,808
Other Assets:
Goodwill	16,360		16,360		16,360
Other intangible assets, net	5,000		5,000		5,000
Other assets, net	18,890		23,005		25,413
Total Other Assets	40,250		44,365		46,773
	$	1,162,929	$	1,196,837	$	1,221,602
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$

SEC Form 10-Q filed by Chico's FAS Inc.