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RH Raises FY 2019 Earnings Guidance as a Result of Closing $350 Million Convertible Notes Offering

CORTE MADERA, Calif.--(BUSINESS WIRE)-- RH (NYSE: RH) announced today the closing of the sale of $350 million aggregate principal amount of its 0.00% convertible notes due 2024, including the full exercise of the $50 million over-allotment option.

As previously announced, RH will apply proceeds from the offering to retire the Company’s $200 million of outstanding second lien debt as well as reduce outstanding borrowings under its credit facilities. Based upon the final terms of the convertible notes offering and the reduction in outstanding balances of debt bearing higher interest rates than the 0% convertible notes, the Company is raising its FY 2019 adjusted diluted earnings per share guidance by $0.25 to a range of $10.78 to $11.01, and expects an approximate $0.75 per share benefit to adjusted diluted earnings per share in fiscal 2020.

This press release does 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, as amended (the “Act”) or any state securities laws, and unless so registered, may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Act and applicable state laws.

About RH

RH (NYSE: RH) is a curator of design, taste and style in the luxury lifestyle market. The Company offers collections through its Retail Galleries, Source Books, and online at RH.com, RHModern.com, RHBeachHouse.com, RHBabyandChild.com, RHTeen.com, and waterworks.com.

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 notes, the expected use of the net proceeds from these transactions, the Company’s expectations regarding a reduction in interest expense, the Company’s expectations regarding an increase in adjusted diluted earnings per share, and any statements or assumptions underlying any of the foregoing. These statements involve risks and uncertainties that may cause results to differ materially from the statements set forth in this press release. The forward-looking statements in this press release speak only as of the date of this press release and are subject to uncertainty and changes. Given these circumstances, you should not place undue reliance on these forward-looking statements. RH expressly disclaims any obligation or undertaking to release publicly any updates or revisions to such forward-looking statements to reflect any change in its expectations with regard thereto or any changes in the events, conditions or circumstances on which any such statement is based. The Company is not able to provide a reconciliation of the Company’s estimate regarding the increase in adjusted diluted earnings per share for fiscal year 2019 or fiscal year 2020 to the corresponding GAAP measure without unreasonable effort because of the uncertainty and variability of the nature and amount of certain charges and gains removed from the corresponding GAAP measure in computing adjusted diluted earnings per share.

Allison Malkin
203-682-8225
allison.malkin@icrinc.com

Source: RH

Released September 18, 2019