EX-99.2 3 a14-20620_1ex99d2.htm EX-99.2

Exhibit 99.2

 

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2014 Second-Quarter Performance September 9, 2014 Financial Results and Company Highlights

 


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Disclaimers Forward-Looking Statements This presentation includes “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control. We caution you that the forward-looking information presented herein is not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking information contained in this presentation. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “plan,” “seek,” “comfortable with,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe” or “continue” or the negative thereof or variations thereon or similar terminology. A number of important factors could cause actual events to differ materially from those contained in or implied by the forward-looking statements, including those factors discussed in our filings with the U.S. Securities & Exchange Commission’s (the “SEC”), including our annual report on Form 10-K, as amended, for the year ended February 2, 2014, which can be found at the SEC’s website www.sec.gov. Any forward-looking information presented herein is made only as of the date of this presentation, and we do not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise. Non-GAAP Financial Measures HD Supply supplements its reporting net income (loss) with non-GAAP measurements, including Adjusted EBITDA, Adjusted net income (loss) and Adjusted net income (loss) per share. This supplemental information should not be considered in isolation or as a substitute for the GAAP measurements. Additional information regarding Adjusted EBITDA, Adjusted net income (loss) and Adjusted net income (loss) per share referred to in this presentation is included at the end of this presentation under “Reconciliation of Non-GAAP Measures.”

 


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Q2’14 Performance Highlights Strong Organic Sales and Earnings Growth +9% Sales Growth Versus Prior Year (VPY) +18% Adjusted EBITDA Growth VPY +117% Adjusted Net Income per Diluted Share Growth VPY +600 Basis Points Versus Market Estimate1 1 Management estimate; market estimate is management estimate of the growth of our markets based on multiple quantitative and qualitative inputs Note: “VPY” denotes Versus Prior Year

 


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Q2’14 Performance Highlights Focused Execution $15M of Investment in 5 Core Growth Strategies: Sell More to Existing Customers (i.e., Share of Wallet) Introduce New Products and Services Expand the Channels to Reach Our Customers (e.g., Internet, Catalog, Mobility) Acquire New Customers Enter New Geographies (i.e., Open New Locations) +10 Basis Points Gross Margin Improvement VPY 1.9x Operating Leverage1 +176% Adjusted Net Income Growth VPY 1 Operating Leverage is defined as Adjusted EBITDA growth divided by total Sales growth Note: “VPY” denotes Versus Prior Year

 


Q2’14 Business Unit Performance Broad-Based Execution 1 Management estimate; market estimate is management estimate of the growth of our markets based on multiple quantitative and qualitative inputs Note: “VPY” denotes Versus Prior Year Sales VPY Adjusted EBITDA VPY Growth in Excess of Market Estimate1 +8% +11% +500 BPs +11% +14% +500 BPs +16% +38% +900 BPs +7% +17% +600 BPs

 


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Q2’14 End Market Observations Cautious Optimism Residential Construction – Slowed Non-Residential Construction – Continued Improvement Infrastructure – Marginal Improvement Maintenance, Repair and Operations (MRO) – Remained Stable

 


Q2’14 Financial Results $2,237M $2,447M +9% Gross Profit Gross Margin % Operating Income Adj. EBITDA % Op. Income % $657M $722M 29.4% 29.5% $219M $258M $152M $186M 9.8% 10.5% 7.6% +10% +10 BPs +70 BPs +18% +9% Sales Growth; +18% Adjusted EBITDA Growth in Q2’14 ($ in millions, except per share data) $37M $102M +176% +600 BPs of Growth in Excess of Estimated Market Growth3 in Q2’14 Q2’14 Sales Growth From: $125M of Growth Initiatives $79M of End Market Growth ($4M) of FX Impact 1.9x Q2’14 Operating Leverage4 +22% Sales 1 During the fourth quarter of fiscal 2013, the company decided to dispose of its Litemor business, a specialty lighting distributor included within the HD Supply Canada business. The results of operations for second quarter 2013 have been revised to reflect the Litemor operations as discontinued operations. 2 See appendix slides 24 and 25 for a reconciliation of Adjusted EBITDA and Adjusted Net Income (Loss) to Net Income (Loss) 3 Management estimate; market estimate is management estimate of the growth of our markets based on multiple quantitative and qualitative inputs 4 Operating Leverage is defined as Adjusted EBITDA growth divided by total Sales growth Note: “VPY” denotes Versus Prior Year Q2’131 Adj. EBITDA2 VPY Adj. Net Income (Loss)2 6.8% +80 BPs Q2’14 $0.23 $0.51 +$0.28 Per Diluted Share

 


Q2’14 Segment Performance Q2’14 $686M $665M $488M $389M Adj. EBITDA $139M $57M $21M $33M Operating Leverage1 1.5x 1.3x 2.4x 2.4x Sales ($ in millions) Broad-Based Strength Q2’13 $638M $601M $456M $336M $125M $50M +11% $18M +7% VPY +8% +11% VPY VPY VPY +14% +17% +16% +38% $24M 1 Operating Leverage is defined as Adjusted EBITDA growth divided by total Sales growth Note: “VPY” denotes Versus Prior Year Q2’14 Q2’13 Q2’14 Q2’13 Q2’14 Q2’13

 


Liquidity and Capital Structure Q2’14 Debt Balances Sec. ABL Sec. Term Loan Sec. 1st Lien Notes Sec. 2nd Lien Notes Unsec. Sr. Notes Unsec. Sr. Notes $470 1,266 675 1,000 1,275 6/28/18 6/28/18 4/15/19 4/15/20 7/15/20 7/15/20 Gross Debt Less Cash Net Debt $5,421 229 $5,650 Facility Balance2 Maturity 1 For a discussion of the risk of a change of control on our tax net operating losses, see the risk factor entitled “Our NOL carryforwards could be limited if we experience an ownership change as defined in the Internal Revenue Code” in our prospectus related to our secondary public offering filed with the U.S. Securities and Exchange Commission on May 2, 2014 2 Net of original issue discount and premium 3 Represents the stated rate of interest, without including the effect of discounts or premiums 4 Subject to applicable redemption price terms 5 Excludes the impact of the tentative settlement of the IRS audits $1.1B of Liquidity with No Near Term Debt Maturities ($ in millions, unless otherwise noted) 1.65% 4.0% 8.125% 11.0% 11.5% 7.5% Interest Rate3 964 n/a now 4/15/15 4/15/16 10/15/16 10/15/16 Soft Call Date4 $5.4B Net Debt at the End of Q2’14 $14M of Cash Interest Paid in Q2’14; $220M YTD $1.1B Liquidity at the End of Q2’14 $6M Cash Taxes Paid Q2’14; FY’14 Estimate of $10M – $20M5 Favorable Tax Asset with Significant Gross Federal Net Operating Loss Carryforwards of $2.3B ($1B Tax-affected Amount of Federal and State NOLs)1 $22M of GAAP Taxes in Q2’14; ~$62M of Estimated GAAP Taxes for FY’145

 


Q2’14 Monthly Average Daily Sales (%) HD Supply Average Daily Sales Growth VPY +9% Q2’14 Sales Growth Versus Prior Year May 8.6% 12.3% 6.4% 13.7% Jul. 6.6% 7.3% 7.2% 18.2% 10.1% Aug. 9.2% 10.2% 7.4% 16.8% 7.6% ’14 Selling Days 19 24 20 20 13.2% 6.8% 15.1% ’13 Selling Days 19 24 20 20 Jun. Facilities Maintenance Waterworks Power Solutions Construction & Industrial (Preliminary) 9.6% 10.1% 8.6% 1 Adjusted for Acquisitions and Divestitures Note: “VPY” denotes Versus Prior Year 8.6% 8.2% 5.8% 8.2% Q2’13 HD Supply Average Daily Sales %1

 


+17% +13% +10% +7% Q3’14 Guidance 8% and 15% Sales and EBITDA Growth, Respectively at Midpoint of Guidance Ranges $2,500M $2,425M $226M $2,273M $265M $255M VPY Q3’13 Q3’14 Q3’13 Q3’14 Q3’14 Net Sales Adj. EBITDA Adj. Net Income Per Diluted Share1 VPY 1 Q3’14 Adjusted Net Income per Share range assumes a fully diluted weighted average share count of 201 million Note: “VPY” denotes Versus Prior Year $0.55 $0.48 VPY ($ in millions, except per share amounts) $0.39 . . . . Q3’13 +43% +25% Midpoint $2,463M +8% $260M +15% $0.51 +33%

 


’14 End Market Outlook Cautious Optimism Total Full-Year Market Estimate Intact ~4% Residential Infrastructure & Other MRO Municipal Power 1 Management estimates (~20%) (~80%) (~25%) (~50%) (~25%) (~25%) (~75%) (~100%) (Approximate End Market Exposure1) FY’14 End Markets Primary End Market Mid-teens Low Single-digit Down Low Single-digits to Flat +1% to +2% Non-Residential Mid Single-digit Previous View1 as of Jun. ‘14 Mid Single-digit Flat +1% to +2% Revision None Current View1 as of Sept. ‘14

 


Controllable Execution +300 Basis Points Above Market Estimate 1 Long-term average growth target based on management estimates and aspirations +200 BPs to +500 BPs +300 BPs Long-term Growth Above Market Estimate Targets1 +200 BPs to +500 BPs +200 BPs to +500 BPs +0 BPs to +200 BPs (BPs Above BU End Market Estimate) Sell More to Existing Customers (i.e., Share of Wallet) Introduce New Products and Services Expand the Channels to Reach Our Customers (e.g., Internet, Catalog, Mobility) Acquire New Customers Enter New Geographies (i.e., Open New Locations) Five Growth “Plays”

 


FY’14 Operating Leverage Framework 1.5x – 2.0x FY’14 Operating Leverage Target; 12% – 16% Implied FY’14 Adjusted EBITDA Growth HDS Market Growth1 Illustrative ~4% + Above Market Growth2 300 BPs = End Market Growth Controllable Execution Annual Sales Growth Illustrative Adj. EBITDA Growth Adjusted EBITDA Growth 14.0% HDS Market Growth 10.5% 7% 2.0x 1.5x Operating Leverage Target2,3 1 Management estimates 2 Long-term average growth target based on management estimates and aspirations; modifications to framework for FY’14 only 3 Operating Leverage defined as the percentage change in Adjusted EBITDA divided by the percentage change in Sales; target based on management estimates and aspirations Note: These objectives are forward-looking, are subject to significant business, economic, regulatory and competitive uncertainties and contingencies, many of which are beyond the control of the Company and its management, and are based upon assumptions with respect to future decisions, which are subject to change. Actual results will vary and those variations may be material. For discussion of some of the important factors that could cause these variations, please consult the “Risk Factors” section of our Form 10-K, as amended, for the year ended February 2, 2014. Nothing in this presentation should be regarded as a representation by any person that these objectives will be achieved and the Company undertakes no duty to update its objectives. 400 BPs 16.0% 12.0% 8% Above Market Growth

 


Outlook Summary Solid Performance Cautiously Optimistic Q3’14 FY’14 +8% Sales Growth VPY at Midpoint of Range +15% Adjusted EBITDA Growth VPY at Midpoint of Range +33% Adjusted Net Income per Diluted Share Growth VPY at Midpoint of Range 201M Diluted Share Count ~4% Blended End Market Growth1 ~400 Basis Points of Estimated Market Outgrowth2 High-end of 1.5x to 2.0x Operating Leverage3 Range 1 Management estimates 2 Long-term average growth target based on management estimates and aspirations; modifications to framework for FY’14 only 3 Operating Leverage defined as the percentage change in Adjusted EBITDA divided by the percentage change in Sales; target based on management estimates and aspirations Note: These objectives are forward-looking, are subject to significant business, economic, regulatory and competitive uncertainties and contingencies, many of which are beyond the control of the Company and its management, and are based upon assumptions with respect to future decisions, which are subject to change. Actual results will vary and those variations may be material. For discussion of some of the important factors that could cause these variations, please consult the “Risk Factors” section of Form 10-K, as amended, for the year ended February 2, 2014. Nothing in this presentation should be regarded as a representation by any person that these objectives will be achieved and the Company undertakes no duty to update its objectives. Note: “VPY” denotes Versus Prior Year Illustrative

 


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Q&A We Supply the Products and Services to Build Your City and Keep it Running

 


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Concluding Remarks Solid Q2’14 Performance +9% Sales Growth VPY +18% Adjusted EBITDA Growth VPY +117% Adjusted Net Income per Diluted Share Growth VPY Pockets of Construction Strength Cautiously Optimistic for 2014 Execution to Deliver Profitable Growth in Excess of Market Growth Estimate Customer-Centric Model Always Focused on Getting Better and Faster Focus on Controllable Execution Note: “VPY” Denotes Versus Prior Year

 


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Appendix

 


Monthly Average Daily Sales Growth – Organic (%) HD Supply Organic Average Daily Sales Growth VPY1 9% Organic Average Daily Sales Growth in Q2’14 7.5% Sep. 6.0% 11.7% 1.4% 12.4% 6.1% Oct. 4.5% 9.3% 1.3% 9.5% 8.6% Nov. 8.1% 9.7% 7.4% 9.2% -2.0% Dec. 0.6% -7.5% -2.8% 2.3% 11.5% Jan. 10.6% 6.0% 10.4% 19.9% Feb. 9.8% 2.2% -3.9% 9.4% ’14 Selling Days ’13 Selling Days 19 19 25 25 18 18 19 19 24 24 ’12 Selling Days 5.8% Aug. 1.6% 11.2% -0.4% 10.5% 20 20 20 19 25 18 20 28 (VPY%) 4.1% 1 Adjusted for Acquisitions, Divestitures, Crown Bolt Contract Amendment and Selling Days Note: “VPY” denotes Versus Prior Year 20 20 20 FY 2013 Apr. May Mar. 20 20 20 25 25 25 19 19 20 FY 2014 4.2% 8.1% 7.0% -6.7% 9.8% 7.5% 5.7% 6.2% 8.5% 12.8% 9.6% 8.6% 12.3% 6.4% 13.7% Facil. Maint. Waterworks Power Solutions Const. & Ind. (Preliminary) Jul. Aug. Jun. 20 20 19 24 24 24 20 20 20 10.1% 7.6% 13.2% 6.8% 15.1% 8.6% 6.6% 7.3% 7.2% 18.2% 10.1% 9.2% 10.2% 7.4% 16.8%

 


Monthly Average Daily Sales Growth (%) HD Supply Average Daily Sales Growth VPY 10% Average Daily Sales Growth in August ’14 (VPY%) Facil. Maint. Waterworks Power Solutions Const. & Ind. ’14 Selling Days ’13 Selling Days ’12 Selling Days 6.5% Aug. 1.6% 15.1% -0.4% 10.5% 20 20 8.3% Sep. 6.0% 15.7% 1.4% 12.4% 19 19 6.8% Oct. 4.5% 13.0% 1.3% 9.5% 25 25 9.3% Nov. 8.1% 13.7% 7.4% 9.2% 18 18 -2.2% Dec. 0.6% -7.5% -2.8% 2.3% 19 19 8.6% Jan. 10.6% 6.0% 10.4% 19.9% 24 24 4.1% Feb. 9.8% 2.2% -3.9% 9.4% 20 20 20 19 25 18 20 28 20 4.2% Mar. 8.1% 7.0% -6.7% 9.8% 20 20 20 7.5% Apr. 5.7% 6.2% 8.5% 12.8% 25 25 25 9.6% May 8.6% 12.3% 6.4% 13.7% 19 19 20 (Preliminary) Jul. Aug. Jun. 10.1% 8.6% FY 2013 FY 2014 20 20 19 24 24 24 7.6% 13.2% 6.8% 15.1% 6.6% 7.3% 7.2% 18.2% Note: “VPY” Denotes Versus Prior Year 20 20 20 10.1% 9.2% 10.2% 7.4% 16.8%

 


Monthly Net Sales ($) HD Supply Net Sales $785 August ’14 Preliminary Sales ($ in millions) ’14 Selling Days ’13 Selling Days ’12 Selling Days Facil. Maint. Waterworks Power Solutions Const. & Ind. Aug. Sep. Oct. Nov. Dec. Jan. Feb. $199 $201 $141 $108 $184 $194 $136 $105 $227 $238 $195 $139 $162 $163 $145 $95 $153 $139 $134 $88 $207 $168 $174 $112 $176 $146 $134 $96 $609M $714M $682M $877M $627M $571M $731M 20 20 19 19 25 25 18 18 19 19 24 24 20 19 25 18 20 28 20 20 20 Mar. Apr. May $184 $168 $140 $106 $244 $237 $187 $142 $195 $197 $142 $113 $712M $893M 20 20 20 25 25 25 19 19 20 $659M (Preliminary) Jul. Aug. Jun. 20 20 20 $790M $218 $945M $273 $217 FY 2013 FY 2014 $218 $250 $222 $157 $189 $151 $125 $151 $127 20 20 19 24 24 24 Note: “VPY” Denotes Versus Prior Year $785M

 


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Average Daily Sales Growth – Organic 9% Organic Average Daily Sales Growth in Q2’14 Q1 Organic Average Daily Sales Growth VPY1 1 Adjusted for Acquisitions, Crown Bolt Contract Amendment, and Selling Days Note: “VPY” Denotes Versus Prior Year Selling Days 65 63 64 61 (VPY%) Q2 Q3 Q4 2011 Facil. Maintenance Waterworks Power Solutions Construction & Industrial HD Supply 9.3% 8.6% 13.5% 13.8% -5.4% 8.5% 3.5% 15.0% 16.2% 12.2% 11.1% 5.5% 5.4% 11.8% 18.4% 25.9% 3.5% 8.5% 9.2% 13.3% 11.2% 5.0% 11.1% 15.1% 8.6% 253 2012 Facil. Maintenance Waterworks Power Solutions Construction & Industrial HD Supply 13.7% 11.4% 14.5% 10.1% 17.1% 6.3% 12.8% 9.3% 5.1% 6.0% 9.1% 11.1% 23.1% 20.4% 14.8% 13.8% 14.0% 9.7% 12.5% 10.1% Selling Days 65 63 64 66 12.3% 11.0% 7.8% 17.7% 11.4% 258 FY 9.6% 8.2% 11.3% 16.5% 11.1% 2013 Facil. Maintenance Waterworks Power Solutions HD Supply 6.9% 3.3% 5.7% 11.4% 6.7% Selling Days 65 9.4% 9.5% 3.6% 9.4% 8.4% 63 64 61 3.9% 10.6% 0.9% 10.7% 6.5% 7.5% 8.2% 5.2% 11.9% 8.2% 253 Construction & Industrial 2014 Facil. Maintenance Waterworks Power Solutions HD Supply Selling Days 7.7% 5.4% -0.2% 11.0% 5.5% 65 Construction & Industrial 7.5% 10.6% 7.0% 15.8% 9.4% 63

 


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Operating Leverage 1.9x Operating Leverage in Q2’14 Q1 Operating Leverage1 (VPY%) Q2 Q3 Q4 1.2x 1.5x 0.7x 1.3x nm 1.3x 2.5x 3.6x 1.2x 0.6x 1.2x (6.6x) nm nm 12.2x nm 6.6x 2.9x 1.9x 2.2x 1.1x 2.8x 0.2x nm 2.7x 1.3x 1.2x 1.6x 1.3x 1.7x 2.9x 1.0x 1.8x 3.3x 7.2x 2.6x 10.5x nm 7.7x 4.7x nm 2.7x 2.4x 2.4x 3.1x 1.4x 1.7x 5.1x 12.5x 2.6x FY 1.4x 2.7x 2.5x 4.5x 2.2x 2.7x 3.7x 4.6x 9.2x 4.4x 1.3x 2.0x (2.8x) 3.5x 1.7x 1.6x 2.1x - 2.1x 1.9x 1.6x 2.4x 1.6x 3.7x 2.3x 1.2x 1.5x - 5.2x 2.8x 1 Operating Leverage is Defined as Adjusted EBITDA Growth Divided by Adjusted Sales Growth. Adjustments Comprise the 53rd Week in fiscal 2012 and the Crown Bolt Amended Agreement. Not Meaningful (“nm”) when Sales Growth is Negative and when Prior Period Adjusted EBITDA is Negative. Note: “VPY” Denotes Versus Prior Year 1.5x 1.3x 2.4x 2.4x 1.9x 2011 Facil. Maintenance Waterworks Power Solutions Construction & Industrial HD Supply 2012 Facil. Maintenance Waterworks Power Solutions Construction & Industrial HD Supply 2013 Facil. Maintenance Waterworks Power Solutions HD Supply Construction & Industrial 2014 Facil. Maintenance Waterworks Power Solutions HD Supply Construction & Industrial HD Supply

 


 Reconciliation of Non-GAAP Measures: Net Income to Adjusted EBITDA ($ in millions) August 3, 2014 August 4, 2013 Three Months Ended Net income (loss) Less income (loss) from discontinued operations, net of tax Income (loss) from continuing operations Interest expense Depreciation and amortization1 Provision from income taxes Stock-based compensation Restructuring2 Loss on extinguishment & modification of debt3 Costs related to the initial public offering4 Management fee & related expenses paid to Equity Sponsors5 Other Adjusted EBTIDA 1 Depreciation and amortization includes amounts recorded within Cost of sales in the Consolidated Statements of Operations. 2 Represents the costs incurred for workforce reductions and branch closure or consolidations. These costs include occupancy costs, severance, and other costs incurred to exit a location. 3 Represents the loss on extinguishment of debt including the premium paid to repurchase or call the debt as well as the write-off of unamortized deferred financing costs and other assets or liabilities associated with such debt. Also includes the costs of debt modification. 4 Represents the costs expensed in connection with the company’s initial public offering, including approximately $18 million paid to the company’s equity sponsors for termination of the consulting agreements. 5 The company was previously party to consulting agreements with its equity sponsors whereby the company paid its equity sponsors a $5 million annual aggregate management fee and related expenses. These consulting agreements were terminated in conjunction with the company’s’ initial public offering in the second quarter of fiscal 2013. $48 - $48 116 66 22 4 4 - - - (2) $258 $(72) (1) $(71) 145 61 12 5 - 46 20 1 - $219

 


 Reconciliation of Non-GAAP Measures: Net Income to Adjusted Net Income ($ in millions, except share and per share amounts) Weighted average common shares outstanding (in thousands) Basic 194,227 153,433 Diluted 200,454 157,751 Adjusted Net Income (Loss) Per Share - Basic $0.53 $0.24 Adjusted Net Income (Loss) Per Share - Diluted $0.51 $0.23 August 3, 2014 August 4, 2013 Three Months Ended Net income (loss) Less income (loss) from discontinued operations, net of tax Income (loss) from continuing operations Plus: Provision for income taxes Less: Cash income taxes Plus: Amortization of acquisition-related intangible assets1 (other than software) Plus: Restructuring2 Plus: Loss on extinguishment & modification of debt3 Plus: Costs related to the initial public offering4 Adjusted net income (loss) $48 - $48 22 (6) 34 4 - - $102 $(72) (1) $(71) 12 (3) 33 - 46 20 $37 1 Estimated Amortization of acquisition-related intangible assets (other than software) for the remainder of FY’14 is expected to be as follows: $27M in Q3’14 and $10M in Q4’14 2 Represents the costs incurred for workforce reductions and branch closure or consolidations. These costs include occupancy costs, severance, and other costs incurred to exit a location. 3 Represents the loss on extinguishment of debt including the premium paid to repurchase or call the debt as well as the write-off of unamortized deferred financing costs and other assets or liabilities associated with such debt. Also includes the costs of debt modification. 4 Represents the costs expensed in connection with the company’s initial public offering, including approximately $18 million paid to the Equity Sponsors for termination of the consulting agreements.

 


 Reconciliation of Non-GAAP Measures: Adjusted EBITDA to Adjusted Net Income ($ in millions) August 3, 2014 August 4, 2013 Three Months Ended Adjusted EBITDA Less: Interest expense Less: Depreciation & amortization, excluding amortization on acquisition-related intangible assets Less: Stock-based compensation Less: Cash tax payments Less: Sponsor management fee1 Other Adjusted net income (loss) $258 (116) (32) (4) (6) 2 $102 $219 (145) (28) (5) (3) (1) $37 1 The company was previously party to consulting agreements with the Equity Sponsors whereby the company paid the Equity Sponsors a $5 million annual aggregate management fee and related expenses. These consulting agreements were terminated in conjunction with the company’s’ initial public offering in the second quarter of fiscal 2013.