The Container Store Group, Inc. (NYSE:TCS) disclosed a 1-for-15 reverse stock split effective September 3, 2024, after the close of trading. In a regulatory filing with the Securities and Exchange Commission (SEC) today, the company stated that its Board of Directors had approved the reverse stock split following stockholder approval during the annual meeting.
The reverse stock split is set to take place at 5:00 p.m. ET on the effective date, with trading on a split-adjusted basis beginning the following day, September 4, 2024. The company's common stock will continue trading on the New York Stock Exchange under the existing ticker symbol "TCS" but with a new CUSIP number, 210751 202.
As a result of the reverse stock split, every fifteen shares of issued and outstanding common stock will be automatically converted into one share. Stockholders will not receive fractional shares but will instead be compensated with a cash payment based on the closing price of the common stock on the NYSE on September 3, 2024.
The reverse stock split will also necessitate proportionate adjustments to the number of shares underlying outstanding equity awards, the number of shares issuable under equity incentive plans, and existing agreements, including a corresponding adjustment to exercise prices where applicable.
In other recent news, The Container Store witnessed a mixed bag of results for the first quarter of fiscal year 2024. The company reported a 13.7% decrease in comparable sales, but also saw a 1.9% growth in the custom spaces sector.
The adjusted loss per share was $0.26, along with a net loss of $14.7 million. Despite these challenges, The Container Store reported an improvement in gross margin rate by 300 basis points, due to reduced freight costs and disciplined promotional activity.
The company has also opened two new stores and is focused on expanding its custom space business. In terms of future plans, The Container Store aims to invest $20-25 million mainly on store and technology enhancements and is considering refinancing their credit facility.
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