Bob’s Discount Furniture is preparing for an initial public offering and plans to use the proceeds to pay down debt and expand its store network.
The company has publicly filed a registration statement in Form S-1 with the US Securities and Exchange Commission regarding the proposed IPO.
The company intends to list its common stock on the New York Stock Exchange under the ticker symbol “BOBS”. The number of shares to be offered and the price range have not been determined.
Founded in 1991, Bob’s offers furniture at “everyday low prices” at more than 200 showrooms across 26 states.
The company plans to use the proceeds from the IPO to prepay all of its debt under the term loan facility. It entered into a $350 million term loan credit agreement at the end of October.
The remaining proceeds will be spent on “general corporate purposes”, including expanding its physical footprint to more than 500 stores by 2035, driving comparable sales growth, and strengthening brand awareness.
According to the company, its net revenue soared 20.4 per cent to $1.7 billion in the year ended September 28, while its net income rose 63.6 per cent to $81 million. Its store network also expanded by 11.4 per cent during the period.
The chain estimates its prices are about 10 per cent below its “value-oriented furniture competitors’ lowest promoted prices”.
Bob’s proposed IPO comes as the housing market remains under pressure.
In the filing, the company said the sector has been impacted by a number of macroeconomic factors, including high interest rates and higher home prices, inflation, and a shift in consumer spending.
However, the firm added it is well-positioned to leverage favorable long-term trends in the housing and home furnishings industries.
“Housing market fundamentals support a near-term recovery, with housing turnover at or near historic lows, creating pent-up demand. Additionally, the persistent gap between housing costs, rent inflation, and wage growth is creating a more value-conscious consumer that aligns with our positioning,” Bob’s said in the S-1 form.
“We believe that the recovery in the housing market will further boost demand for home furnishings, presenting a compelling opportunity for incremental growth in our business,” it added.
