Company: SPWH
Filing Date: 2025-04-02
Form Type: 10-K
Source: 0000950170-25-048890
Chunk: 684

Company: SPORTSMAN'S WAREHOUSE HOLDINGS, INC.
Filing Date: 2025-04-02
Form: 10-K
Item: Item 7
Chunk 684
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 Apparel and Footwear departments, resulting from our increased promotional efforts to reduce inventory and decreases in net sales and same store sales. 

Selling, General and Administrative Expenses. Selling, general and administrative expenses increased by $6.6 million, or 1.6%, to $408.8 million for fiscal year 2023 from $402.2 million for fiscal year 2022. This increase was 

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primarily due to increases in rent and depreciation expenses of $11.5 million and $7.2 million, driven by the opening of 15 new store locations during fiscal year 2023. We incurred $4.8 million in executive transitional expenses after the retirement of our Chief Executive Officer in April 2023. Additionally, we incurred $1.2 million of severance expenses related to the implementation of our cost reduction plan and $0.7 million related to a one-time legal settlement and related fees and expenses.  These increases were partially offset by a decreases of $12.8 million and $4.8 million in payroll and other operating expenses, respectively, driven by our ongoing cost cutting measures and increased operational efficiencies across our retail stores.

On a per store basis, our payroll and other operating expenses were down approximately 16% and 14%, respectively, compared to fiscal year 2022. As a percentage of net sales, selling, general, and administrative expenses increased to 31.7% of net sales during fiscal year 2023 compared to 28.7% of net sales in fiscal year 2022, as a result of the factors discussed above.  New store pre-opening expenses increased by $2.1 million to $5.8 million during fiscal year 2023 compared to $3.7 million in fiscal year 2022.

Interest Expense. Interest expense increased by $8.7 million, or 206.8%, to $12.9 million in fiscal year 2023 from $4.2 million for fiscal year 2022. Interest expense increased primarily as a result increased borrowings on our revolving credit facility and higher interest rates for fiscal year 2023 compared to fiscal year 2022.

Income Taxes. We recorded an income tax benefit of $9.2 million for fiscal year 2023 compared to income tax expense of $13.4 million for fiscal year 2022. Our effective tax rate decreased to 24.1% during fiscal year 2023 compared to 24.8% in fiscal year 2022.

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