RH Exploring Potential $300 Million Convertible Notes Offering
In the event the Company chooses to complete the proposed
Proceeds of the offering would be used to pay the net cost of the convertible note hedge transactions and to pay down the outstanding borrowings under the Company’s credit facility and other interest bearing debt on the balance sheet.
Paying down the credit facility and other interest bearing debt would result in a corresponding reduction in the Company’s interest expense in fiscal 2018. This reduction in interest expense is not factored into the Company’s current fiscal 2018 adjusted net income and adjusted diluted earnings per share outlook, and as a result, the Company anticipates that paying down such outstanding borrowings with attractively priced convertible notes offering proceeds would result in an increase to its adjusted earnings guidance.
Given the Company’s anticipated 2018 free cash flow and its outlook for
2019 and beyond,
The interest rate, conversion price and other terms of any new issuance
of notes are subject to the final pricing determination in connection
with any offering. The notes would be convertible into cash, shares of
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of these
securities in any state or jurisdiction in which such offer,
solicitation, or sale would be unlawful prior to registration or
qualification under the securities laws of any such state or
jurisdiction. The notes and the shares of common stock issuable upon
conversion of the notes, if any, will not be registered under the
Securities Act of 1933 (the “Act”) or any state securities laws, and
unless so registered, may not be offered or sold in
About
Forward-Looking Statements
Some of the statements in this press release are “forward-looking” and
are made pursuant to the safe harbor provision of the Private Securities
Litigation Reform Act of 1995. These “forward-looking” statements
include statements relating to, among other things, the proposed
offering of the convertible notes, the anticipated terms of the notes
and the convertible note hedge and warrant transactions as well as any
dilution impact to holders of the common stock, the expected use of the
net proceeds from these transactions, the Company’s expectations
regarding the impact of the anticipated use of the net proceeds of the
offering to pay down the outstanding borrowings under the Company’s
credit facility including but not limited to a corresponding reduction
in the Company’s interest expense in fiscal 2018 and an upward
adjustment to the Company’s earnings guidance, the Company’s anticipated
fiscal 2018 free cash flow and its outlook for 2019 and beyond, the
Company’s plans to repay the outstanding principal balance of its
existing
View source version on businesswire.com: https://www.businesswire.com/news/home/20180612006491/en/
Source:
RH
Cammeron McLaughlin, 415-945-4998
SVP, Investor Relations &
Strategy
cmclaughlin@rh.com