Restoration Hardware Launches IPO

CORTE MADERA, Calif.--Restoration Hardware has released its initial public offering, which the retailer hopes will garner $150 million.

In its filing for the IPO with the U.S. Securities and Exchange Commission, the company said it intends to use the proceeds to repay all or a portion of outstanding amounts in its revolving line of credit; for working capital and capital expenditures; and for fees and expenses related to the stock offering. Since June 2008, Restoration Hardware has been a privately held company owned by Home Holdings, an entity consisting of affiliates of Catterton Management, Tower Three and Glenhill Capital, all equity firms.

According to the financial data provided in the filing, Restoration Hardware narrowed its net loss from $58.8 million in its fiscal year ending on Jan. 31, 2009, to $28.7 million for the next fiscal year, and again to $8.1 million in the fiscal year ending on Jan. 29, 2011. Net revenues for fiscal 2011 rose 23.5 percent to $772.8 million. For the first half of the current fiscal year, Restoration Hardware posted net income of $1.1 million, compared to a net loss of $11.3 million in the same period of the prior fiscal year, and a net revenue gain of 27 percent to $420.4 million.

Restoration Hardware also outlined its growth strategy in the IPO. The company plans to expand its existing product categories and enter new ones, open new stores under its recently developed Design Gallery format in key metropolitan markets, grow its direct-to-consumer business by expanding its catalog and implementing e-commerce marketing initiatives, increase operating margins and expand internationally.

"We believe Restoration Hardware is one of the fastest growing and most innovative luxury brands in the home furnishings marketplace," the filing said. "Restoration Hardware is positioned as a lifestyle brand and design authority, offering dominant assortments across a growing number of categories, including furniture, lighting, textiles, bathware, decor, outdoor and garden, as well as baby and child products."

HFN Staff | News & Commentary

HFN provides detailed information on the key home classifications: Housewares, Tabletop, Floor Covering & Rugs, Furniture, Home Textiles, Lighting, Home Decor, Mattresses & Bedding, Gifts, Major Appliances and Consumer Electronics as well as Business, Finance and Retail.

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