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In preparation for STNR's 2Q earnings release tomorrow, we’ve put together the recent pertinent forward looking company commentary

1Q CONFERENCE CALL YOUTUBE

  • 2Q GUIDANCE
    • Revenue: $190-195MM
    • EPS: $0.87-0.92
    • D&A: $4.6MM
      • Above the line depreciation: $3.4MM
      • Below the line depreciation: $900K
      • Below the line amortization: $300K
    • Capital spending: $12.5MM (includes $7.5MM for FL corp office purchase)
  • FY2012 GUIDANCE
    • Revenue: $810MM
    • EPS: $3.80
  • "The scheduled capital repayments on the term loan commenced at the end of the first quarter of 2012 and due at the end of each of quarter of 2012 is an amount of $4.125 million, with the interest on the loan for 2012 anticipated to be LIBOR plus 2.5%."
  • "We have commenced the build-out of our second Texas location, and expect to enroll students in the Houston location by the third quarter of 2012."
  • "Ideal Image continues to perform well. We have opened two new laser centers this year, and continue to track well on our target of 15 new centers for 2012."
    • "Cash sales generated in the quarter exceeded expectations and increased our deferred revenue liability on the balance sheet, which was a healthy barometer of the future earnings potential of our laser hair removal division."
  • [$17MM as run rate for SG&A?] "There's probably some stuff in there that could come down a little bit. But it's about right, I mean, that looks like the run rate that is going to track along. I mean, we're still working on some of the synergies in Cortiva, but I wouldn't look for that thing to drop down much through the back end of the year."
  • [Education segment ex Cortiva] "The headwinds that we've faced since July of last year have not changed direction, nor have they changed their intensity. We're all working much harder to get enrollments with less money in terms of Title IV. So it's clearly a struggle, Steve. We're not different than anybody else. Having said that though, we're watching our costs as much as we can."
  • [Product business] "If you take a look at the 2% clip in our revenue growth, it would have been higher, but for a big QVC promotion that was scheduled for March, and part of our control was pushed into the second quarter. So it will still be there....We expect that to take place, I think, it takes place on April 30. So really QVC just switched that up at the last moment on us, so we really don't have any control of it. It wasn't that we lost that; it's just that it was shifted from a timing perspective. So good news is we'll still do it. It will impact the second quarter. So that was a big chunk of it."
  • "So trend's difficult to say. I haven't seen any change, negative change. I haven't seen anything that really sort of is noticeable on whatever we look at across the board. I would say Europe is still soft-ish. And I don't think that is very different from what our cruise line partners are seeing. Certainly, there are soft points in our itineraries, but the most noticeable one so far, and continues to be, which is similar to my comments on my last quarter, is Europe is weaker than last year at this time. Outside of that, I haven't seen any trends."
  • "We do see a little bit of softness in Europe still and I don't see that fixing itself in the near term."
  • [Sales trends and margins in product business] "I expect it to be much of the same. I mean, I think clearly we were impacted by some timing issues in there. Europe, UK, I mean, is turning to be tougher. Just this morning they reported that the economy there has got a little tougher. And a large part of the elements business is there. So it's really an unknown for us to say that we're seeing downward pressure from where we're at today. Hopefully, we can continue to roll as we are and not take so many more hits."
  • "Schools are a tough environment right now. The good news is after second quarter, we'll anniversary the regulatory changes. So it'll be apples-and-apples to compare how we're doing from an enrollment perspective, and all the other metrics that we follow. I don't see the environment getting any better. It's a tough environment. There's less money for the students. And that's making them think a lot longer about coming to school and enrolling. And we'll certainly see how we do sort of in the third quarter where we have the larger enrollments. But it's been tough for the last seven months. And I don't think it's going to lighten up for the next eight months. We will see how things turn out after the election. And we'll see how the regulatory headwinds change, if any, next year. And if they do for the better, then so too will the schools get better. But who knows where the focus will be next year post-elections."