Description of Business and Basis of Presentation |
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May 01, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Description of Business and Basis of Presentation |
Business Description Express, Inc., together with its subsidiaries (“Express” or the “Company”), is a modern, versatile, dual gender apparel and accessories brand that helps people get dressed for every day and any occasion. Launched in 1980 with the idea that style, quality and value should all be found in one place, Express has been a brand of the now, offering some of the most important and enduring fashion trends. Express aims to Create Confidence & Inspire Self-Expression through a design & merchandising view that brings forward The Best of Now for Real Life Versatility. The Company operates 563 retail and factory outlet stores in the United States and Puerto Rico, as well as an online destination. As of May 1, 2021, Express operated 357 primarily mall-based retail stores in the United States and Puerto Rico as well as 206 factory outlet stores. Fiscal Year The Company's fiscal year ends on the Saturday closest to January 31. Fiscal years are designated in the unaudited Consolidated Financial Statements and Notes, as well as the remainder of this Quarterly Report, by the calendar year in which the fiscal year commences. All references herein to the Company's fiscal years are as follows:
All references herein to “the first quarter of 2021” and “the first quarter of 2020” represent the thirteen weeks ended May 1, 2021 and May 2, 2020, respectively. Basis of Presentation The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and the U.S. Securities and Exchange Commission’s Article 10, Regulation S-X and therefore do not include all of the information or footnotes required for complete financial statements. In the opinion of management, the accompanying unaudited Consolidated Financial Statements reflect all adjustments (which are of a normal recurring nature) necessary to state fairly the financial position, results of operations, and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for 2021. Therefore, these statements should be read in conjunction with the Consolidated Financial Statements and Notes thereto for the year ended January 30, 2021, included in the Company’s Annual Report on Form 10-K, filed with the SEC on March 25, 2021. Principles of Consolidation The unaudited Consolidated Financial Statements include the accounts of Express, Inc. and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Segment Reporting The Company defines an operating segment on the same basis that it uses to evaluate performance internally. The Company has determined that, together, its Chief Executive Officer and its President and Chief Operating Officer are the Chief Operating Decision Maker, and that there is one operating segment. Therefore, the Company reports results as a single segment, which includes the operation of its Express brick-and-mortar retail and outlet stores and eCommerce operations. Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the unaudited Consolidated Financial Statements and the reported amounts of revenue and expense during the reporting period, as well as the related disclosure of contingent assets and liabilities as of the date of the unaudited Consolidated Financial Statements. Actual results may differ from those estimates. The Company revises its estimates and assumptions as new information becomes available. Going Concern and Management's Plans The Company has seen significant recovery in sales and profitability in the first quarter with continued improvement into the second quarter and continues to be in compliance with the financial covenants under its Revolving Credit Facility and Term Loan Facility. However, due to the uncertainty related to the speed of recovery from the COVID-19 pandemic and its potential impacts, the Company could experience material changes to forecasted revenues and cash flows and could experience difficulty remaining in compliance with financial covenants. When conditions and events, in the aggregate, impact an entity's ability to continue as a going concern, management evaluates the mitigating effect of its plans to determine if it is probable that the plans will be effectively implemented and, when implemented, the plans will mitigate the relevant conditions or events. Based upon the sales and profitability recovery seen in the first quarter and continued improvement into the second quarter, as well as the availability of additional liquidity under the Revolving Credit Facility, and expense control and other measures taken to date, the Company's liquidity position has improved significantly. The Company plans to continue its cash conservation and cost reduction measures taken to date, including rent concessions agreed to, and is forecasting continued improvement in both sales and profitability in the remainder of 2021. The Company believes these plans and forecasts are probable of being successfully implemented, which will result in adequate cash flows to support its ongoing operations and to meet its covenant requirements under the Revolving Credit Facility and Term Loan Facility for one year following the date these financial statements are issued.
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