The Aaron’s Company, Inc. (NYSE:AAN) Q1 2024 Earnings Call Transcript

The increase in other OpEx year-over-year is driven by really two things. One, increased investment in advertising, particularly at the errands business, which is a component of what’s kind of driving our growth that we’re seeing there. Also, there are some new store opening costs associated with the store that we’re opening up at BrandsMart. So that’s what’s driving that 50 basis point increase in operating margin. I also want to just give you kind of a quick update on the spread of earnings, through the course of the year. We’re currently expecting that consolidated revenues for the full year, are in line with expectations, but that they’re going to grow sequentially each quarter with Q2, representing about 20% to 25% of the full year and then as that translates down to adjusted EBITDA, we’re expecting that Q2, is going to represent about 25% of the full year there.

And then you probably also heard us talk about the change in tax rate on the prepared remarks. So there, that 12 percentage point improvement did lead to our increase in outlook for non-GAAP EPS, but the tax rate will be different in each quarter of the year. I think more specifically, we’re expecting that Q4 will be about 300 basis points lower than Q2 and Q3, with Q2 and Q3 roughly the same. So hopefully that helps you all with some of your modeling for the year.

Hoang Nguyen: Thank you.

Operator: Thank you. We currently have no further questions. I will hand back to Douglas for any closing remarks.

Douglas Lindsay: Thank you, operator. Thank you for joining the call today, and thank you to all of our company and franchise team members of Aaron’s BrandsMart, BrandsMart Leasing and Woodhaven, for your continued focus on delivering exceptional value, and service to our customers each and every day. We look forward to speaking to each of you again next quarter. Thanks so much.

Operator: Thank you. This concludes today’s call. Thank you for joining. You may now disconnect your lines.