On November 9, 2023, National Vision Holdings Inc (EYE, Financial) disclosed its financial results for the third quarter ended September 30, 2023. The company reported a net revenue increase of 6.6% to $532.4 million, driven by growth in Adjusted Comparable Store Sales, new store sales, and higher revenue from the AC Lens business. However, National Vision faced a net loss of $73.8 million, with a Diluted EPS of $(0.94), primarily due to $79.4 million in non-cash impairment charges associated with the termination of its Walmart partnership. This compares unfavorably to the net income of $11.5 million and Diluted EPS of $0.15 in Q3 2022.
Financial Performance Overview
Despite the net loss, the company's Comparable store sales growth stood at 3.8%, with an Adjusted Comparable Store Sales Growth of 4.3%. The company opened 21 new stores, bringing the total to 1,402 stores, marking a 5.3% increase in store count year-over-year. Costs applicable to revenue rose by 8.3% to $252.0 million, and Selling, General, and Administrative expenses (SG&A) increased by 11.0% to $249.7 million. Adjusted SG&A also saw an 8.7% increase to $241.5 million.
Balance Sheet and Cash Flow Highlights
National Vision ended the quarter with a cash balance of $265.8 million and total debt of $562.8 million. Operating cash flows for the first nine months of 2023 were $153.3 million, an increase from the $121.3 million reported for the same period in 2022. Capital expenditures for the first nine months totaled $82.0 million.
Strategic Initiatives and Outlook
The company has announced cost savings and pricing initiatives expected to yield annualized savings of $10 million to $12 million, starting in 2024. These measures, along with non-headline pricing actions, are anticipated to more than offset the profitability gap created by the Walmart partnership termination.
For fiscal 2023, National Vision expects net revenue to be between $2.115 billion and $2.125 billion, with an Adjusted Operating Income of $60 million to $65 million, and Adjusted Diluted EPS of $0.53 to $0.58. Capital expenditures are projected to be between $115 million and $120 million.
The company's fiscal 2023 outlook is subject to various uncertainties, including macro-economic factors and the impact of the Walmart partnership termination. National Vision will host a conference call to discuss these results and provide further details on its strategic plans.
For more comprehensive information on National Vision Holdings Inc's financial results, including detailed financial tables and a reconciliation of non-GAAP to GAAP financial measures, please visit National Vision's investor relations page.
Explore the complete 8-K earnings release (here) from National Vision Holdings Inc for further details.
