Restoration Hardware (RH) 4Q16 Results: Better-than-Expected Results; Upbeat 2017 Outlook

Executive Summary

• Restoration Hardware reported 4Q16 adjusted EPS of $0.68, down from $0.98 in the year-ago quarter but above the consensus estimate of $0.65 and inline with company guidance. The retailer reported adjusted revenue of $590.1 million, down 8.8% from $647.2 million in the year-ago quarter but above the $584.2 million consensus estimate.
• Comparable brand revenue, which includes direct revenue, declined by 18% during the quarter, compared with 9% growth for the same period the prior year. Store revenues decreased by 4% from the year-ago quarter, to $306.2 million. Direct revenues decreased by 15% year over year, to $280.5 million.
• FY17 guidance calls for EPS of $1.78–$2.19, a wide range compared with the $1.94 consensus estimate. The company expects FY17 revenues of $2.30–$2.40 billion, versus the consensus estimate of $2.33 billion.