What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2025-03-20 compared with 2024-03-21 · 181 added, 319 removed, 1018 unchanged (33% of the section changed)

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Changes in Internal Control over Financial Reporting

We rely extensively on information systems to manage our business and report operating results.

During the 2023 second quarter, we completed the implementation of our new Enterprise Resource Planning ("ERP") system, which resulted in considerable changes to our processes and control environment, including modifications to existing applications and reports.

The new ERP replaced our legacy system, in which our business transactions are processed and recorded.

The new ERP is intended to facilitate transactional processing and enhance management tools and is expected to improve internal controls over financial reporting.

Other than as described above, no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the Company's most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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Other Information

(a) Board of Directors Update

Appointment of Monique Picou to Board of Directors

On March 18, 2024, the Board of the Company approved an increase of the size of the Board of Directors from nine to ten directors and appointed Monique Picou, age 57, as an independent Class II director, effective immediately, to fill the vacancy created by such increase.

Picou’s initial term will expire on the date of the Company’s 2025 Annual Meeting of Stockholders and until her successor shall be elected and qualified or until her earlier death, resignation, retirement, disqualification or removal.

Picou serves as Global Executive - Vice President, Google Cloud Supply Chain and Operations at Alphabet, Inc.

since March 2023, and also served as Vice President, Google Product, Technology Strategy and Global Server Operations at Alphabet, Inc.

from February 2021 to April 2023.

Prior to Alphabet, Inc., Mrs.

Picou served as Senior Vice President, Sam’s Club Chief Strategy and Supply Chain Officer from March 2020 to February 2021, as Sam’s Club Senior Vice President Supply Chain Flow from February 2019 to February 2020, and Vice President, Supply Chain at Walmart, Inc.

from August 2018 to January 2019.

Picou held other senior leadership positions at Voyant Beauty, LLC and Procter & Gamble Company, where she spent more than 25 years and served in various positions, including Senior Vice President – Product Supply Global Health Care from December 2016 to August 2017.

Since November 2021, Mrs.

Picou has served on the board of directors of Ryan Companies US, Inc., a commercial real estate services company.

She is a graduate of Southern University with a Bachelor of Science in Electrical Engineering and earned a Master of Business Administration from Florida Institute of Technology.

The Board of Directors selected Mrs.

Picou because of her supply chain, logistics, strategic planning, operations, digital/technology, and engineering experience at technology, retail and manufacturing companies.

The Board of Directors has determined that Mrs.

Picou qualifies as an independent director under the corporate governance standards of Nasdaq, and that there are no arrangement or understanding between Mrs.

Picou and any other person pursuant to which she was elected as a director.

There are no transactions in which Mrs.

Picou has an interest requiring disclosure under Item 404(a) of Regulation S-K.

As compensation for her service on the Board, Mrs.

Picou will receive the cash and equity compensation provided by the Company’s Non-Employee Director Compensation Policy, as it may be adjusted by the Board of Directors from time to time, a copy of which is filed as Exhibit 10.66 to this Annual Report on Form 10-K.

In addition, the Company and Mrs.

Picou will enter into the Company’s standard form of indemnification agreement for directors.

Transition of Ken C.

Hicks to Chairman of the Board of Directors

In connection with a planned transition process, on March 19, 2024, the Company and Ken C.

Hicks, Executive Chairman of the Board of Directors of the Company, mutually agreed that Mr.

Hicks’s Amended and Restated Employment Agreement, dated April 26, 2023 would not be extended beyond its initial one-year term and that Mr.

Hicks will transition from Executive Chairman of the Board to non-employee Chairman of the Board of Directors, effective on June 1, 2024.

As compensation for his service as non-employee Chairman of the Board of Directors, Mr.

Hicks will receive annual cash retainers totaling $175,000 and equity compensation in the form of restricted stock units with an annualized grant value totaling $285,000, each as provided by the Company’s Non-Employee Director Compensation Policy, a copy of which is filed as Exhibit 10.66 to this Annual Report on Form 10-K.

(b) Trading Plans

During the quarter ended February 3, 2024, the following trading plan(s) intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) that are required to be disclosed under Item 408 of Regulation S-K was/were adopted or terminated :

Name Title Date Plan

Adopted/Terminated Duration of Plan Common Shares to be Purchased or Sold Comments

Tweedy Director Adopted January 19, 2024

April 19, 2024 through December 31, 2024 Sell up to 2,400 common shares, subject to certain conditions set forth in the trading plan.

Tweedy's previously disclosed trading plan was completed pursuant to the terms set forth in that trading plan.

Trading Plans

During the quarter ended February 1, 2025, no director or officer (as defined by Rule 16a-1(f) under the Exchange Act) of the Company adopted or terminated any Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements (in each case, as defined in Item 408(a) of Regulation S-K).

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

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Further information required by this item will be included in our definitive proxy statement for the 2025 Annual Meeting of Stockholders and is incorporated herein by reference.

We have adopted an insider trading policy governing the purchase, sale, and/or other dispositions of our securities by our directors, officers, and employees, or the Company, that we believe is reasonably designed to promote compliance with insider trading laws, rules and regulations, and the exchange listing standards applicable to us.

A copy of our insider trading policy is filed as Exhibit 19.1 to this Annual Report on Form 10-K.

Executive Compensation

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Total 3,543,018 $ 27.79 (2)

(1) Of the plans listed above, only 2020 Omnibus Incentive Plan and the 2020 Employee Stock Purchase Plan allows for future grants of securities.

(1) Of the plans listed above, only 2020 Omnibus Incentive Plan and the 2020 Employee Stock Purchase Plan allow for future grants of securities.

The maximum number of shares that may be granted under the 2020 Omnibus Incentive Plan (inclusive of unissued shares that were carried over from the 2011 Unit Incentive Plan) is approximately 5,205,413.

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The information required by this item will be included in our definitive proxy statement for the 2025 Annual Meeting of Stockholders and is incorporated herein by reference.

Exhibits and Financial Statement Schedules

Exhibits and Financial Statements Schedules

(a) The following documents are filed as part of this Annual Report on Form 10-K:

(1) Financial Statements.

The consolidated Financial Statements required to be filed hereunder are listed in the Index to Consolidated Financial Statements on page 70 of this Annual Report on Form 10-K.

The consolidated Financial Statements required to be filed hereunder are listed in the Index to Consolidated Financial Statement s on page 68 of this Annual Report on Form 10-K.

(2) Financial Statement Schedule.

The consolidated financial statement schedule to be filed hereunder is included on page 113 of this Annual Report on Form 10-K.

The consolidated financial statements schedule to be filed hereunder is included on page 108 o f this Annual Report on Form 10-K.

Other schedules have not been included because they are not applicable or because the information is included elsewhere in this report.

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Report of Independent Registered Public Accounting Firm (PCAOB ID No.

Consolidated Balance Sheets as of February 3, 2024 and January 28, 2023 73

Consolidated Statements of Income for the fiscal years ended February 3, 2024, January 28, 2023 and January 29, 2022 74

Consolidated Statements of Comprehensive Income for the fiscal years ended February 3, 2024, January 28, 2023 and January 29, 2022 75

Consolidated Statements of Stockholders' Equity for the fiscal years ended February 3, 2024, January 28, 2023 and January 29, 2022 76

Consolidated Statements of Cash Flows for the fiscal years ended February 3, 2024, January 28, 2023 and January 29, 2022 77

Consolidated Balance Sheets as of February 1, 2025 and February 3, 2024 71

Consolidated Statements of Income for the fiscal years ended February 1, 2025, February 3, 2024 and January 28, 2023 72

Consolidated Statements of Stockholders' Equity for the fiscal years ended February 1, 2025, February 3, 2024 and January 28, 2023 73

Consolidated Statements of Cash Flows for the fiscal years ended February 1, 2025, February 3, 2024 and January 28, 2023 74

Notes to the Consolidated Financial Statements 75

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We have audited the accompanying consolidated balance sheets of Academy Sports and Outdoors, Inc.

and subsidiaries (the "Company") as of February 3, 2024 and January 28, 2023, the related consolidated statements of income, comprehensive income, stockholders' equity, and cash flows, for each of the three years in the period ended February 3, 2024, and the related notes and schedule listed in the Index at Item 15 (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of February 3, 2024 and January 28, 2023, and the results of its operations and its cash flows for each of the three years in the period ended February 3, 2024, in conformity with accounting principles generally accepted in the United States of America.

and subsidiaries (the "Company") as of February 1, 2025 and February 3, 2024, the related consolidated statements of income, stockholders' equity, and cash flows, for each of the three years in the period ended February 1, 2025, and the related notes and schedule listed in the Index at Item 15 (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of February 1, 2025 and February 3, 2024, and the results of its operations and its cash flows for each of the three years in the period ended February 1, 2025, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of February 1, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 20, 2025 expressed an unqualified opinion on the Company’s internal control over financial reporting.

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Our responsibility is to express an opinion on the Company’s financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

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The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Gain Contingency - Refer to Note 12 to the financial statements

Critical Audit Matter Description

As described in Note 14 of the Consolidated Financial Statements, as of February 3, 2024, the Company is involved in a regulatory matter with the U.S.

Customs and Border Protection Agency (“CBP”) regarding additional duties relating to certain products that the Company imported from China which CBP believes are subject to certain anti-dumping and/or countervailing duties, as well as a legal matter regarding payment card interchange fees charged by financial institutions (the defendants) to the Company (the plaintiff).

The Company records a liability for legal proceedings and regulatory matters when management determines it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated.

The Company also discloses when it is reasonably possible that a material loss may be incurred.

In assessing the probability of occurrence and whether an estimate of loss can be reasonably estimated for a particular legal proceeding, management exercises judgment on matters relevant to each proceeding, such as whether sufficient participation in settlement proceedings will occur, or whether it can predict the number of claims that may be filed.

Similarly, the Company will record a contingency that might result in a gain when it is the plaintiff, when the gain is realized or realizable.

Auditing management's accounting for, and disclosure of, contingencies was complex and highly judgmental as it involved our assessment of the significant judgments made by management when assessing the probability of occurrence for loss contingencies, determining whether an estimate of the amount of contingencies could be made, and assessing whether a gain contingency was realized or realizable.

As described in Note 12 of the financial statements, in January 2025, the Company settled a legal matter pertaining to a third-party vendor where the Company is the plaintiff.

In connection with this settlement, the Company recognized a net gain of approximately $15.0 million in Other (income), net on the consolidated statements of income, when the gain became realizable.

Auditing management's accounting for, and disclosure of a contingency is complex and highly judgmental as it involved our assessment of the significant judgments made by management when determining whether an estimate of the amount of contingency could be made, and assessing whether a gain contingency was realized or realizable.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the management’s judgment included the following, among others:

Our audit procedures related to management’s judgment included the following, among others:

• We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over management’s identification, monitoring and evaluation of contingencies.

• We read documents provided to the Company by outside legal counsel, read letters received directly by us from internal and outside legal counsel, and evaluated the current status of contingencies based on discussions with internal and outside legal counsel.

• We inspected minutes of the meetings of the Board of Directors and committees of the Board of Directors to search for any contradictory evidence, which may indicate that the accounting and disclosures for contingencies might not be appropriate.

• We made inquiries of management, including the Company’s internal legal counsel, regarding the status of these contingencies and whether any settlement discussions had been held.

• We evaluated management's assumptions and calculations by, among other things, comparing those assumptions to underlying legal documents and to payments made during the year.

We also assessed the adequacy of the related disclosures.

• We tested the amounts of the gain contingency realizable as of year end, including consideration of any contrary evidence for events subsequent to year end.

• With the assistance of professionals in our firm having experience in accounting for contingencies, we evaluated the reasonableness of the judgements and accounting guidance utilized by the Company to record the gain contingency that was realizable as of year end.

• We read documents provided to the Company by outside legal counsel, read letters received directly by us from internal and outside legal counsel, and evaluated the current status of the contingency based on discussions with internal and outside legal counsel.

• We made inquiries of management, including the Company’s internal legal counsel and Chief legal officer, regarding the status of the contingency and whether any settlement discussions had been held.

• We tested the amount of gain contingency realizable as of year end, including vouching the amount received and consideration of any contrary evidence for events subsequent to year end.

• With the assistance of professionals in our firm having experience in accounting for contingencies, we evaluated the reasonableness of the judgments and accounting guidance used by the Company to record the gain contingency that was realizable as of year end.

/s/ Deloitte & Touche LLP

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(Dollar amounts in thousands, except per share data)

February 3, 2024 January 28, 2023

February 1, 2025 February 3, 2024

CURRENT ASSETS:

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16,759 19,371

Merchandise inventories, net 1,194,159 1,283,517

Merchandise inventories

1,308,840 1,194,159

Prepaid expenses and other current assets 95,621 83,450

Assets held for sale — 1,763

Total current assets 1,710,149 1,644,900

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Common stock, $ 0.01 par value, authorized 300,000,000 shares;

74,349,927 and 76,711,720 issued and outstanding as of February 3, 2024 and January 28, 2023, respectively

68,332,961 and 74,349,927 issued and outstanding as of February 1, 2025 and February 3, 2024, respectively

Additional paid-in capital 247,094 242,098

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Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

February 1, 2025 February 3, 2024 January 28, 2023

NET SALES $ 5,933,450 $ 6,159,291 $ 6,395,073

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INTEREST EXPENSE, NET 36,873 46,051 46,441

LOSS ON EARLY RETIREMENT OF DEBT 1,525 1,963 2,239

WRITE OFF OF DEFERRED LOAN COSTS 449 1,525 1,963

OTHER (INCOME), NET ( 36,908 ) ( 32,877 ) ( 20,175 )

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ACADEMY SPORTS AND OUTDOORS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Amounts in thousands)

Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

COMPREHENSIVE INCOME:

Net income $ 519,190 $ 628,001 $ 671,381

Recognized interest expense on interest rate swaps — — 2,344

Tax benefit — — 980

Total comprehensive income $ 519,190 $ 628,001 $ 674,705

See Notes to Consolidated Financial Statements

ACADEMY SPORTS AND OUTDOORS, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

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Settlement of vested Restricted Stock Units 100 1 ( 1 ) — — —

Share-Based Award Payments adjustment for forfeitures — — 39 — — 39

Issuance of common stock under employee stock purchase plan 168 2 5,041 — — 5,043

Stock option exercises 1,269 13 21,236 — — 21,249

Recognized interest expense on interest rate swaps (net of tax benefit of $ 980 )

Cash dividends declared, $ 0.075 per share

— — — ( 24,633 ) — ( 24,633 )

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— — — ( 27,218 ) — ( 27,218 )

Balances as of January 28, 2023 76,712 $ 767 $ 216,209 $ 1,411,330 $ — $ 1,628,306

Balances as of February 3, 2024 74,350 $ 743 $ 242,098 $ 1,711,809 $ — $ 1,954,650

Net income — — — 418,447 — 418,447

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Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

February 1, 2025 February 3, 2024 January 28, 2023

CASH FLOWS FROM OPERATING ACTIVITIES:

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Equity compensation 26,629 24,377 21,175

Amortization of deferred loan, terminated interest rate swaps and other costs 2,739 3,054 5,524

Amortization of deferred loan and other costs

2,574 2,739 3,054

Deferred income taxes 2,020 ( 4,247 ) 41,831

Non-cash loss on early retirement of debt — 1,525 1,963

Write-off of Deferred Loan Costs 449 — —

Gain on disposal of property and equipment ( 7,062 ) ( 388 ) —

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Accounts receivable, net 2,611 ( 2,868 ) 3,215

Merchandise inventories, net 89,358 ( 111,709 ) ( 181,774 )

Merchandise inventories ( 114,681 ) 89,358 ( 111,709 )

Prepaid expenses and other current assets ( 10,117 ) ( 50,225 ) ( 11,287 )

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CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from Revolving Credit Facilities 3,900 — —

Reduction in Revolving Credit Facilities ( 3,900 ) — —

Repayment of Term Loan ( 3,000 ) ( 103,000 ) ( 103,000 )

Debt issuance fees ( 5,689 ) — —

Share-Based Award Payments — — ( 11,214 )

Proceeds from exercise of stock options 4,323 16,636 21,249

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Net cash used in financing activities ( 400,953 ) ( 318,865 ) ( 592,052 )

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 10,775 ( 148,853 ) 108,394

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS ( 58,991 ) 10,775 ( 148,853 )

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 347,920 337,145 485,998

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Non-cash capital expenditures $ 12,273 $ 6,687 $ 4,046

Right-of-use assets obtained in exchange for new operating leases $ 214,747 $ 134,181 $ 116,652

See Notes to Consolidated Financial Statements

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All of the Company’s sales and business operations occur at Academy, Ltd., and Academy, Ltd.

is also the borrower and/or issuer of the Company’s long-term debt and lessee of facilities.

On August 3, 2011, an investment entity owned by investment funds and other entities affiliated with Kohlberg Kravis Roberts & Co.

(collectively, "KKR"), acquired a majority interest in the Company.

The Company completed an initial public offering (the "IPO") on October 6, 2020, and upon completion of the September 2021 Secondary Offering (as defined below), KKR no longer holds an ownership interest in the Company.

is also the borrower and/or issuer of the Company’s long-term debt and the lessee of the Company's facilities.

The Company is a leading full-line sporting goods and outdoor recreational products retailer in the United States in terms of net sales.

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The Company’s fiscal year represents the 52 or 53 weeks ending on the Saturday closest to January 31 each year.

References herein to 2023 relate to the 53-week fiscal year ended February 3, 2024, and references herein to 2022 and 2021 relate to the 52-week fiscal years ended January 28, 2023, and January 29, 2022, respectively.

May 2021 Secondary Offering and Stock Repurchase

On May 5, 2021, ASO, Inc.

entered into an underwriting agreement (the “May 2021 Underwriting Agreement”), by and among ASO, Inc., Allstar LLC, Allstar Co-Invest Blocker L.P., KKR 2006 Allstar Blocker L.P., MSI 2011 LLC and MG Family Limited Partnership (collectively, the “May 2021 Selling Stockholders”), and Credit Suisse Securities (USA) LLC and J.P.

Morgan Securities LLC, as representatives of the several underwriters named therein (the “May 2021 Underwriters”), relating to an underwritten offering of 14,000,000 shares of common stock at $ 30.96 per share (the “May 2021 Secondary Offering”), pursuant to the Company’s Registration Statement on Form S-1 (File No.

333-255720), filed on May 3, 2021.

The May 2021 Selling Stockholders granted the May 2021 Underwriters the option to purchase, within 30 days from the date of the May 2021 Underwriting Agreement, an additional 2,100,000 shares of common stock.

On May 6, 2021, the May 2021 Underwriters exercised in full their option to purchase the additional shares.

The May 2021 Secondary Offering also included the Company's repurchase and simultaneous retirement of 3,229,974 shares out of the 14,000,000 shares at $ 30.96 per share, the same price granted to the May 2021 Underwriters, which was at a discount to the prevailing market price at the time of repurchase (see "Share Repurchases" in Note 2).

The May 2021 Secondary Offering was completed on May 10, 2021.

The Company did not receive any proceeds from the May 2021 Secondary Offering.

The May 2021 Secondary Offering reduced the KKR ownership interest in the Company, resulting in a vesting event (the "2021 Vesting Event") for awards granted under the 2011 Unit Incentive Plan, whereby unvested time awards and performance-based awards which had previously met their performance targets vested and unvested performance-based awards which had not previously met their performance targets were forfeited.

As a result, we incurred approximately $ 24.9 million in non-cash expenses related to equity-based compensation and approximately $ 15.4 million of cash expenses related to taxes on equity-based compensation.

Additionally, approximately $ 8.2 million of Share-Based Award Payments (see Note 9) for equity-based compensation distributions were accelerated during the 2021 second quarter.

September 2021 Secondary Offering and Stock Repurchase

On September 14, 2021, ASO, Inc.

entered into an underwriting agreement (the “September 2021 Underwriting Agreement”), by and among ASO, Inc., Allstar LLC, Allstar Co-Invest Blocker L.P.

and KKR 2006 Allstar Blocker L.P.

(collectively, the “September 2021 Selling Stockholders”), and Credit Suisse Securities (USA) LLC, as representative of the several underwriters named therein (the “September 2021 Underwriters”), relating to an underwritten offering (the “September 2021 Secondary Offering”) of 18,645,602 shares of common stock at approximately $ 43.52 per share, pursuant to the Company’s Registration Statement on Form S-1 (File No.

333-259477), filed on September 13, 2021.

The September 2021 Secondary Offering also included the Company’s repurchase and simultaneous retirement of 4,500,000 shares out of the 18,645,602 shares of common stock at approximately $ 43.52 , the same price granted to the September 2021 Underwriters, which was at a discount to the prevailing market price at the time of repurchase (see "Share Repurchases" in Note 2).

The September 2021 Secondary Offering was completed on September 17, 2021.

The Company did not receive any proceeds from the September 2021 Secondary Offering.

References herein to 2024 relate to the 52-week fiscal year ended February 1, 2025, and references herein to 2023 and 2022 relate to the 53-week fiscal year ended February 3, 2024 and the 52-week fiscal year ended January 28, 2023, respectively.

Summary of Significant Accounting Policies

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These consolidated financial statements include the accounts of ASO, Inc.

and its subsidiaries, New Academy Holding Company, LLC ("NAHC"), Academy Managing Co., LLC, Associated Investors, LLC, Academy, Ltd., the Company's operating company, and Academy International Limited.

and its subsidiaries, New Academy Holding Company, LLC (“NAHC”), Academy Managing Co., LLC, Associated Investors, LLC, Academy, Ltd., the Company's operating company, Academy International Limited, Mason Creek Insurance Co., LLC, and Academy Procurement Co., LLC.

NAHC, Academy Managing Co., LLC, and Associated Investors, LLC are intermediate holding companies.

All intercompany balances and transactions have been eliminated in consolidation.

ASO Co-Invest Blocker Sub, L.P.

and ASO Blocker Sub, L.P.

were dissolved effective January 31, 2021.

Use of Estimates in the Preparation of Financial Statements

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Our most significant estimates and assumptions that materially affect the financial statements involve difficult, subjective or complex judgments by management including the valuation of merchandise inventories, and performing goodwill, intangible and long-lived asset impairment analyses.

Reclassifications

Within the merchandise division sales table presented in Note 3, certain products and categories were recategorized among various categories and divisions, respectively, during 2023 to better align with our current merchandising strategy and view of the business.

As a result, we have reclassified sales between divisions for 2022 and 2021 for comparability purposes.

This reclassification is in divisional presentation only and did not impact the overall net sales balances previously disclosed.

Cash and Cash Equivalents

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The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to the short-term nature of those instruments.

We have also historically entered into derivative interest rate swaps to reduce the risk that our earnings and cash flows will be affected by changes in interest rates on our debt.

The fair value of debt is influenced by fluctuations in market conditions for interest rates (see Note 5).

We did not have any derivative financial instruments outstanding as of February 3, 2024 or January 28, 2023.

Accounts Receivable

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No other vendor in any of the aforementioned years exceeded 11% of our purchases.

We typically do not enter into long-term inventory purchase commitments, and we did not have any such commitments as of February 3, 2024 or January 28, 2023.

We typically do not enter into long-term inventory purchase commitments, and we did not have any such commitments as of February 1, 2025 or February 3, 2024.

A significant portion of our inventory purchases are manufactured outside of the United States, primarily in Asia.

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We regularly review inventories and record a valuation adjustment when necessary such as for inventory that has a carrying value in excess of the net realizable value or for slow moving or obsolete inventory.

Prior to 2023, we valued merchandise inventories at the lower of the weighted average cost method or LIFO method (see Change in Accounting Principle discussion below).

The application of the LIFO inventory method did not result in any LIFO charges or credits affecting cost of sales in 2022 or 2021.

Change in Accounting Principle

Effective January 29, 2023, the Company changed the method of accounting for its inventories from the last-in-first-out (“LIFO”) method to the weighted average cost method.

The Company believes that this inventory method change is preferable because we believe it improves comparability with industry peers and is a more accurate representation of merchandise inventories, net and cost of goods sold.

Due to historical price deflation on the Company’s merchandise purchases, the Company was in a position where the LIFO merchandise inventories value exceeded the cost of its inventory for all periods presented in the consolidated financial statements.

In considering the lower of cost or market principle, merchandise inventories valued at LIFO, including necessary valuation adjustments, approximated the cost of such inventories using the weighted average inventory method.

As such, there is no impact to the prior periods from the retrospective presentation of the change.

The following tables show the pro forma effect to our consolidated financial statements as if the Company had remained on LIFO (amounts in thousands):

February 3, 2024

Consolidated Balance Sheet As Reported Effect of Change Pro Forma LIFO

Merchandise inventories, net $ 1,194,159 $ ( 2,615 ) $ 1,191,544

Total current assets 1,644,900 ( 2,615 ) 1,642,285

Total assets 4,676,713 ( 2,615 ) 4,674,098

Accrued expenses and other current liabilities 217,932 ( 27,219 ) 190,713

Total current liabilities 879,858 ( 27,219 ) 852,639

Deferred tax liabilities, net 254,796 26,609 281,405

Total liabilities 2,722,063 ( 610 ) 2,721,453

Retained earnings 1,711,809 ( 2,005 ) 1,709,804

Stockholders' equity 1,954,650 ( 2,005 ) 1,952,645

Total liabilities and stockholders' equity 4,676,713 ( 2,615 ) 4,674,098

Year Ended February 3, 2024

As Reported Effect of Change Pro Forma LIFO

Consolidated Statements of Income:

Cost of goods sold $ 4,049,080 $ 2,615 $ 4,051,695

Gross margin 2,110,211 ( 2,615 ) 2,107,596

Operating income 677,855 ( 2,615 ) 675,240

Income before income taxes 663,156 ( 2,615 ) 660,541

Income tax expense 143,966 ( 610 ) 143,356

Net income 519,190 ( 2,005 ) 517,185

Earnings per common share:

Basic $ 6.89 $ ( 0.03 ) $ 6.86

Diluted $ 6.70 $ ( 0.03 ) $ 6.67

Consolidated Statements of Cash Flows:

Net income $ 519,190 $ ( 2,005 ) $ 517,185

Deferred income taxes ( 4,247 ) 26,609 22,362

LIFO charge — 2,615 2,615

Income taxes payable 17,640 ( 27,219 ) ( 9,579 )

Net cash provided by operating activities 535,779 — 535,779

Supplier Finance Programs

In September 2022, the FASB issued ASU 2022-04:

Liabilities - Supplier Finance Programs Disclosure of Supplier Finance Program Obligations.

This pronouncement requires that a buyer in a supplier finance program disclose sufficient information about the program to allow a user of the financial statements to understand the program's nature, activity during the period, changes from period to period and potential magnitude.

The Company adopted the new guidance as of January 29, 2023.

We have previously entered into a supply chain financing arrangement with a third-party financial institution, whereby certain suppliers have the ability to settle outstanding payment obligations earlier than the due date required by our original supplier terms.

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The following table shows our liability associated with these arrangements, which is presented within accounts payable on the Consolidated Balance Sheets, and the related activity for the periods presented (amounts in thousands):

February 3, 2024 January 28, 2023

February 1, 2025 February 3, 2024

Invoices outstanding at the beginning of the year $ 7,174 $ 8,953

19 unchanged sentences

Implementation costs for cloud-based information systems are capitalized in other non-current assets.

Amortization of cloud-based software implementation costs is recognized in selling, general and administrative expenses and amortized over the longer of the contract term or expected benefit.

Amortization of cloud-based software implementation costs is recognized in selling, general and administrative expenses and cost of goods sold, which is amortized over the longer of the contract term or expected benefit.

The amounts capitalized were $ 20.6 million, $ 23.5 million and $ 12.3 million in 2024, 2023 and 2022, respectively.

14 unchanged sentences

However, if the qualitative assessment leads to a determination that it is more likely than not that the fair value of a reporting unit is greater than its carrying amount, then no further assessments are required.

In 2023, 2022 and 2021, we performed a qualitative assessment and determined a quantitative assessment was not necessary.

Our quantitative assessment for determining the fair value of our reporting unit includes using an estimated discounted cash flow model (income approach) and market value approach.

The output of this assessment is an estimated fair value for our reporting unit that is compared to its carrying value to determine whether an impairment charge is necessary.

The income approach uses a discounted cash flow analysis of our projected long-term future company income, and the market value approach is based on earnings multiples for a comparable set of public companies.

No impairment of goodwill existed for 2023, 2022 or 2021.

The income approach uses a discounted cash flow analysis of our projected long-term future company income.

The market valu e approach is based on earnings multiples for a comparable set of public companies as well as guideline transactions.

We did not record an impairment of goodwill for 2024, 2023 or 2022.

Intangible Assets

5 unchanged sentences

However, if the qualitative assessment leads to a determination that it is more likely than not that the fair value of an intangible asset is greater than its carrying amount, then no further assessments are required.

In 2023, 2022 and 2021, we performed a qualitative assessment and determined a quantitative assessment was not necessary.

Impairment is calculated as the excess of the Trade Name’s carrying value over its fair value.

3 unchanged sentences

This approach is dependent on a number of factors, including projections of long-term sales, royalty rates, discount rates and other variables.

No impairment of intangible assets existed for 2023, 2022 or 2021.

We did not record an impairment of intangible assets for 2024, 2023 or 2022.

Deferred Loan Costs

2 unchanged sentences

The costs related to the issuance of our revolving credit facility is recorded in other noncurrent assets on the Consolidated Balance Sheets and amortized as a component of interest expense over the terms of the related debt agreements using the straight-line method.

Derivative Instruments

We are exposed to interest rate risk, primarily related to changes in interest rates on our Term Loan (see Note 4) and have historically used interest rate swap agreements, which we have designated as "cash flow" hedges, to hedge against market risks relating to possible adverse changes in interest rates.

We assess, both at the inception of the hedge and on an ongoing basis, whether derivatives used as hedging instruments are highly effective in offsetting the changes in the fair value or cash flow of the hedged items.

If it is determined that a derivative is not highly effective as a hedge or ceases to be highly effective, we discontinue hedge accounting prospectively.

Derivative financial instruments are recognized at fair value in the consolidated balance sheets (see Note 5).

The changes in the fair value of derivative instruments designated as cash flow hedges are recorded in accumulated other comprehensive income ("AOCI"), net of tax effects, and are subsequently reclassified to earnings when the hedged transaction affects earnings.

On January 19, 2021, we settled our three remaining outstanding interest rate swaps, which were scheduled to expire on various dates during 2021, for $ 4.1 million.

As of February 3, 2024, we do not have any derivative financial instruments outstanding.

Self-Insurance

We maintain deductibles or self-insurance retentions for workers' compensation, general liability and employee health benefits.

We maintain deductibles or self-insured retentions for workers' compensation, general liability and employee health benefits.

The Company has a wholly owned captive insurance subsidiary (the “Captive”) with the primary purpose to enhance the Company's risk financing strategies by providing the Company the opportunity to negotiate insurance premiums in the non-retail insurance market.

The Captive must maintain a sufficient level of liquidity to fund future reserve payments and secure the insurer's obligations for workers compensation, Texas non-subscriber, general liability, directors and officers liability, employment practices liability, and medical stop-loss programs.

Additionally, we use the services of an independent actuary to assist in determining losses associated with workers' compensation, general liability and employee health benefits.

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We may receive reimbursement from a landlord for some or all of the cost of a construction project, which may be structured as a tenant improvement allowance or a construction allowance.

Cash received from a landlord for tenant improvement allowances in store lease transactions are a reduction to the right-of-use assets on the balance sheet, which are amortized ratably over the remaining terms of the corresponding leases.

Cash received from a landlord for tenant improvement allowances in store lease transactions is a reduction to the right-of-use assets on the balance sheet, which is amortized ratably over the remaining terms of the corresponding leases.

Cash received for construction allowances is a reimbursement of certain spend incurred in the construction of the premises on behalf of the landlord, where the landlord owns the assets.

In 2024, we entered into a sale-leaseback transaction which qualified for sale accounting under ASC 606.

Further, per ASC 842, a gain was recognized up to the fair value of the asset (see Note 11).

We account for each lease and non-lease components for our building leases as a single lease component which allows certain costs such as common area maintenance associated with these leases to be included as rent expense.

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Our typical coupons offer a discount, which is applied immediately at the time of purchase.

However, under certain circumstances we may issue a coupon, or similar incentive, which contains a material future right.

In such instances, a portion of the revenue is deferred and subsequently recognized when earned.

However, under certain circumstances we may issue a coupon, or similar incentive, which may contain a material future right.

Revenue from merchandise sales is recognized, net of sales tax, when the Company’s performance obligation to the customer is met, which is when the Company transfers control of the merchandise to the customer.

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Cost of goods sold includes the direct cost of merchandise and costs related to procurement, warehousing and distribution.

These costs consist primarily of payroll and benefits, occupancy costs and freight.

These costs consist primarily of payroll and benefits, occupancy costs, depreciation and freight.

Shipping and Handling Costs

3 unchanged sentences

Vendor allowances include volume purchase rebates, promotional and advertising allowances, cooperative advertising funds and support for new store openings.

These allowances are generally determined for each fiscal year with the majority of allowances based on quantitative contract terms.

These allowances are generally determined for each fiscal year.

Allowances related to the purchase of merchandise inventories are recorded as a reduction of cost of goods sold as the related merchandise is sold.

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Selling, general and administrative expenses include store and corporate administrative payroll and payroll benefits, store and corporate headquarters occupancy costs, depreciation, advertising, credit card processing, information technology, pre-opening costs and other store and administrative expenses.

During the fourth quarter of 2024, we closed on a sale-leaseback agreement involving a store property in Cypress, Texas.

We determined that the sale-leaseback transaction qualifies as a sale in accordance with ASC 842 (See Note 11).

In connection with the sale-leaseback transaction, we recognized a net gain of approximately $ 7.1 million in Selling, General, and Administrative expenses on the Consolidated Statements of Income.

Advertising Expenses

5 unchanged sentences

Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

February 1, 2025 February 3, 2024 January 28, 2023

Number of new stores opened 16 14 9

6 unchanged sentences

Share Repurchases

On September 2, 2021, the Board of Directors of the Company authorized a share repurchase program (the "2021 Share Repurchase Program") under which the Company may purchase up to $ 500 million of its outstanding shares during the three-year period ending September 2, 2024.

On June 2, 2022, the Board of Directors authorized a new share repurchase program (the "2022 Share Repurchase Program") under which the Company may purchase up to $ 600 million of its outstanding shares during the three-year period ending June 2, 2025.

On November 29, 2023, the Board of Directors authorized a new share repurchase program (the “2023 Share Repurchase Program”) under which the Company may purchase up to $ 600 million of its outstanding shares during the three-year period ending November 29, 2026.

The 2023 Share Repurchase Program, the 2022 Share Repurchase Program and the 2021 Share Repurchase Program are collectively referred to as the "Share Repurchase Programs".

Under the Share Repurchase Programs, repurchases can be made using a variety of methods, which may include open market purchases, block trades, privately negotiated transactions, accelerated share repurchase programs and/or a non-discretionary trading plan, all in compliance with the rules of the SEC and other applicable legal requirements.

The timing, manner, price and amount of any common share repurchases will be determined by the Company in its discretion and will depend on a variety of factors, including legal requirements, price and economic and market conditions.

The Share Repurchase Programs do not obligate the Company to acquire any particular number of common shares, and the programs may be suspended, extended, modified or discontinued at any time.

Under the 2023 Share Repurchase Program, repurchases can be made using a variety of methods, which may include open market purchases, block trades, privately negotiated transactions, accelerated share repurchase programs and/or Rule 10b5-1 or other non-discretionary trading plans, all in compliance with the rules of the SEC and other applicable legal requirements.

The timing, manner, price and amount of any common share repurchases under the 2023 Share Repurchase Program are determined by the Company in its discretion and depend on a variety of factors, including legal requirements, price, economic and market conditions.

The 2023 Share Repurchase Program does not obligate the Company to acquire any particular number of common shares, and the program may be suspended, extended, modified or discontinued at any time.

On December 4, 2024, the Company's Board of Directors authorized a new share repurchase program under which the Company is authorized to purchase up to $ 700 million of its outstanding shares during the three-year period ending December 4, 2027 (the “2024 Share Repurchase Program”), and which replaces the 2023 Share Repurchase Program.

Under the 2024 Share Repurchase Program, repurchases can be made using a variety of methods, which may include open market purchases, block trades, accelerated share repurchase programs, privately negotiated transactions and/or Rule 10b5-1 or other non-discretionary trading plans, all in compliance with the rules of the SEC and other applicable legal requirements.

The timing, manner, price and amount of any common share repurchases under the 2024 Share Repurchase Program will be determined by the Company in its discretion and will depend on a variety of factors, including legal requirements, price, economic and market conditions.

The 2024 Share Repurchase Program does not obligate the Company to acquire any particular number of common shares, and the program may be suspended, extended, modified or discontinued at any time.

The following table summarizes our share repurchases for the periods presented:

Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

February 1, 2025 February 3, 2024 January 28, 2023

Shares Repurchased

2 unchanged sentences

$ 368.3 $ 204.2 $ 489.5

(1) Purchases for the fiscal year ended January 29, 2022, include purchases that were made prior to our Share Repurchase Programs.

(2) Includes estimated excise tax fees of $ 1.4 million for the fiscal year ended February 3, 2024.

(1) Includes excise tax fees of $ 3.4 million for the fiscal year ended February 1, 2025.

The Company allocates the excess of the repurchase price over the par value of shares acquired to Retained Earnings and Additional Paid-in Capital.

The portion allocated to Additional Paid-in Capital is determined by dividing the number of shares to be retired by the number of shares issued multiplied by the balance of Additional Paid-in Capital as of the retirement date.

As of February 3, 2024, we no longer had availability under the 2021 Share Repurchase Program, and we had $ 696.7 million available for share repurchases pursuant to the combined 2023 Share Repurchase Program and 2022 Share Repurchase Program.

As of February 1, 2025, we had $ 635.5 million available for share repurchases pursuant to the 2024 Share Repurchase Program.

The Company is subject to U.S.

1 unchanged sentence

We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements.

Under this method, deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the temporary differences are expected to be realized or settled.

Under this method, deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the temporary differences are expected to be

realized or settled.

The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

5 unchanged sentences

Interest and penalties from income tax matters are recognized in income tax expense.

Reclassifications

Within the reconciliation table of the statutory U.S.

federal income tax rate to our effective income tax rate presented in Note 10, certain tax effects were allocated among the effect of tax credits and the effect of other permanent items on the effective tax rate during 2023 due to the Company’s purchase of energy credits under the new Inflation Reduction Act related to tax years ending February 3, 2024 and February 1, 2025.

As a result, we have reclassified the effect of other permanent items for fiscal year 2023 for comparability purposes (there was no impact to fiscal year 2022).

This reclassification is in presentation only and did not impact the balances previously disclosed.

During the fourth quarter of 2022, the Company received and recognized approximately $ 7.2 million in business interruption proceeds due to the suspension of normal operations at some of our Texas store locations, as well as our e-commerce platform, for several days in February of 2021 as a result of a winter storm which had a significant impact on the energy infrastructure in the state of Texas.

3 unchanged sentences

In connection with this settlement, we recognized a net gain of approximately $ 15.9 million in Other (income), net on the Consolidated Statements of Income.

Comprehensive Income

Comprehensive income represents the net income for the period plus the results of certain changes to stockholders' equity (other comprehensive income) that are not reflected in the consolidated statements of income.

Other comprehensive income consists of adjustments, net of tax, related to the Company’s historical ownership of interest rate swaps.

During the fourth quarter of 2024, the Company settled a legal matter with a third-party vendor.

In connection with this settlement, we recognized a net gain of approximately $ 15.0 million in Other (income), net on the Consolidated Statements of Income.

Operating Segment

1 unchanged sentence

Substantially all of the Company’s identifiable assets are located in the United States.

Comprehensive Income (Loss)

The Company has no components of other comprehensive income (loss), and therefore, comprehensive income equals net income.

Recent Accounting Pronouncements

Reference Rate Reform

In March 2020, the FASB issued ASU 2020-04:

Facilitation of the Effects of Reference Rate Reform on Financial Reporting.

This pronouncement provides temporary optional expedients and exceptions to the current guidance on contract modifications and hedge accounting to ease the financial reporting burden related to the expected market transition from the London Interbank Offered Rate ("LIBOR") and other interbank offered rates to alternative reference rates.

In December 2022, the FASB issued ASU 2022-06 which extended the effectiveness of this guidance to December 31, 2024.

The Company elected to utilize these optional expedients in connection with the amendments to our ABL Facility and Term Loan, which transitioned from LIBOR to the Secured Overnight Financing Rate (“SOFR”) on March 30, 2023 and August 1, 2023, respectively (see Note 4).

Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU 2023-09:

Improvements to Income Tax Disclosures.

This pronouncement is intended to enhance the transparency and decision usefulness of income tax disclosures and establishes new income tax disclosure requirements, including requiring disaggregation of a reporting entity’s effective tax rate reconciliation and disaggregation of the income taxes paid based on the applicable tax jurisdiction.

The new guidance is effective for fiscal years beginning after December 15, 2024 and should be applied on a prospective basis with the option to apply the standard retrospectively.

The Company is currently evaluating the impact that the adoption of this accounting standard will have on its financial disclosures.

Segment Reporting

Accounting Guidance Adopted

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

2 unchanged sentences

The new guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, and should be adopted retrospectively.

The Company is currently evaluating the impact that the adoption of this accounting standard will have on its financial disclosures.

The Company adopted ASU 2023-07 retrospectively effective February 1, 2025 (see Note 14).

The adoption of this standard did not have a material impact on the Company’s consolidated financial statement disclosures.

Accounting Guidance Not Yet Adopted

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures .

The new guidance is effective for fiscal years beginning after December 15, 2024 and should be applied on a prospective basis with the option to apply the standard retrospectively.

The Company is evaluating the impact of adopting ASU 2023-09 on its consolidated financial statements.

On November 4, 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses , which requires disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses.

The new guidance is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027.

The requirements will be applied prospectively with the option for retrospective application.

The Company is evaluating the impact of adopting ASU 2024-03 on its consolidated financial statements.

The following table sets forth the approximate amount of sales (all of which are based in the U.S.) by merchandise divisions for the periods presented (amounts in thousands):

Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

February 1, 2025 February 3, 2024 January 28, 2023

Merchandise division sales

8 unchanged sentences

Net sales $ 5,933,450 $ 6,159,291 $ 6,395,073

(1) Certain products and categories were re-categorized among various categories and divisions, respectively, during 2023 to better align with our current merchandising strategy and view of the business.

As a result, we have reclassified sales between divisions for 2022 and 2021 for comparability purposes.

This reclassification is in divisional presentation only and did not impact the overall net sales balances previously disclosed (see Note 2).

(1) E-commerce sales consisted of 10.5 %, 10.7 % and 10.7 % of merchandise sales for 2024, 2023 and 2022, respectively.

7 unchanged sentences

Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

February 1, 2025 February 3, 2024 January 28, 2023

Gift card liability, beginning balance $ 94,155 $ 90,650 $ 86,568

5 unchanged sentences

Our debt consisted of the following (amounts in thousands) as of:

February 3, 2024 January 28, 2023

ABL Facility, due November 2025 (1)

February 1, 2025 February 3, 2024

ABL Facility, due March 2029 $ — $ —

Term Loan, due November 2027 88,750 91,750

6 unchanged sentences

Long-term debt, net $ 482,679 $ 484,551

(1) On March 8, 2024, the Company issued a press release announcing that the Company had entered into an amendment to the First Amended and Restated ABL Credit Agreement which, among other things, extended the maturity of our asset-based revolving credit facility to March 8, 2029.

See Note 17 to the accompanying financial statements for further disclosures regarding the amendment.

(1) Deferred loan costs are related to the Term Loan and Notes.

As of February 3, 2024 and January 28, 2023, the balance in deferred loan costs related to the ABL Facility (as defined below) was approximately $ 2.1 million and $ 3.2 million, respectively, and was included in other noncurrent assets on our consolidated balance sheets.

As of February 1, 2025 and February 3, 2024, the balance in deferred loan costs related to the ABL Facility (as defined below) was approximately $ 6.1 million and $ 2.1 million, respectively, and was included in other noncurrent assets on our Consolidated Balance Sheets.

Total amortization of deferred loan costs was $ 2.4 million, $ 2.4 million and $ 2.6 million in 2024, 2023 and 2022, respectively.

1 unchanged sentence

The expenses related to amortization of deferred loan costs and accretion of original issuance discount are included in interest expense, net on the Consolidated Statements of Income.

On November 6, 2020, the Company issued the Notes (as defined below), entered into the 2020 Term Loan (as defined below), and entered into the 2020 ABL Facility (the "Refinancing Transactions").

The Company used the net proceeds from the Notes and the net proceeds from the 2020 Term Loan, together with cash on hand, to repay in full outstanding borrowings under its then-existing term loan, in the amount of $ 1,431.4 million.

On May 25, 2021, the Company refinanced its 2020 Term Loan and paid down approximately $ 99.0 million of the 2020 Term Loan.

On December 15, 2022 and February 1, 2024, the Company utilized cash on hand to voluntarily prepay $ 100.0 million of outstanding borrowings of the Term Loan, respectively.

We refer to the 2020 Term Loan and then amendments thereto collectively as the “Term Loan”.

On November 6, 2020, as a part of the Refinancing Transactions, Academy, Ltd.

entered into a seven-year $ 400.0 million senior secured term loan (the "2020 Term Loan") with Credit Suisse AG, Cayman Island Branch ("Credit Suisse"), as the administrative agent and collateral agent and the several other lenders and parties.

On November 6, 2020, Academy, Ltd.

entered into a seven-year $ 400.0 million senior secured term loan (the “2020 Term Loan”) with Credit Suisse AG, Cayman Island Branch (“Credit Suisse”), as the administrative agent and collateral agent and the several other lenders and parties named therein.

The 2020 Term Loan bore interest, at Academy, Ltd.’s election, at either (1) LIBOR rate with a floor of 0.75 %, plus a margin of 5.00 %, or (2) a base rate equal to the highest of (a) the federal funds rate plus 0.50 %, (b) Credit Suisse’s “prime rate”, or (c) the one-month LIBOR rate plus 1.00 %, plus a margin of 4.00 %.

2 unchanged sentences

entered into Amendment No.

4 (the “2021 Amendment”) to the Second Amended and Restated Credit Agreement, dated as of November 6, 2020, among Academy, Ltd., as Borrower, Credit Suisse AG, Cayman Islands Branch, as the administrative agent and collateral agent, the several lenders party thereto and the several other parties named therein (as previously amended, the “Existing Credit Agreement” and as amended by the 2021 Amendment, the “Amended Credit Agreement”).

4 (the “2021 Amendment”).

Pursuant to the terms of the 2021 Amendment, Academy, Ltd.

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The ABL Facility is used to provide financing for working capital and other general corporate purposes, as well as to support certain letters of credit requirements, and availability is subject to customary borrowing base and availability provisions.

During the normal course of business, we periodically utilize letters of credit primarily for the purchase of import goods and in support of insurance contracts.

During the normal course of business, we periodically utilize letters of credit primarily in support of insurance contracts and occasionally for the purchase of import goods.

As of February 1, 2025, we had outstanding letters of credit of approximately $ 9.3 million, all of which were issued under the ABL Facility, and we had no borrowings outstanding under the ABL Facility, leaving the available borrowing capacity under the ABL Facility of $ 955.5 million.

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As of February 1, 2025, no future prepayments of outstanding loans have been triggered under the terms and conditions of the ABL Facility.

On March 8, 2024, the Company issued a press release announcing that the Company had entered into an amendment to the First Amended and Restated ABL Credit Agreement which, among other things, extended the maturity of our asset-based revolving credit facility to March 8, 2029.

See Note 17 to the accompanying financial statements for further disclosures regarding the amendment.

On March 8, 2024 Academy, Ltd.

(“Academy”), a wholly-owned subsidiary of Academy Sports and Outdoors, Inc., as borrower, New Academy Holding Company, LLC, Associated Investors, L.L.C.

and Academy Managing Co., L.L.C., each a direct or indirect, wholly-owned subsidiary of the Company, as guarantors, entered into an amendment (the “ABL Amendment”) to the First Amended and Restated ABL Credit Agreement, dated as of July 2, 2015, with JPMorgan Chase Bank, N.A.

as the administrative agent and collateral agent, letter of credit issuer and swingline lender, and the several lenders party thereto, which ABL Amendment, among other things, extended the maturity of Academy’s asset-based revolving credit facility (the “ABL Credit Facility”) to March 8, 2029, unless if (i) more than $ 100 million of the aggregate principal amount of the 2027 Senior Notes (as defined in the ABL Amendment) or the Term Loans (as defined in the ABL Amendment), or any refinancing thereof, in each case, is outstanding on the date that is 91 days prior to the earliest maturity date of any such indebtedness or (ii) equal to or less than $ 100 million of the aggregate principal amount of the 2027 Senior Notes or the Term Loans, in either case, is outstanding on the date that is 91 days prior to the earliest maturity date of any such indebtedness and a Reserve (as defined in the ABL Amendment) in the ABL Credit Facility has not been taken for such amount, then the maturity date of the ABL Credit Facility will be the date that is 91 days earlier than the earlier maturity date of the 2027 Senior Notes and the Term Loans.

In connection with the ABL Amendment and the reduction of two lenders who dropped out of the ABL Facility, the Company wrote off $ 0.4 million of deferred loan costs related to the ABL Facility.

Liens and guarantees.

25 unchanged sentences

Total $ 488,750

Derivative Financial Instruments

We have historically used interest rate swap agreements to hedge market risk relating to possible adverse changes in interest rates.

All interest rate swaps had been designated as cash flow hedges of variable rate interest payments on borrowings under the Term Loan.

On January 19, 2021, we settled our three outstanding interest rate swaps in full, which were scheduled to expire on various dates during 2021, for $ 4.1 million.

As of February 3, 2024, we do not have any derivative financial instruments outstanding.

For derivatives previously designated as hedging instruments, amounts included in AOCI were reclassified to interest expense in the same period during which the hedged transaction affected earnings, which is as interest expense was recorded on the underlying Term Loan.

The impact of gains and losses related to interest rate swaps that were deferred into AOCI and subsequently reclassified into expense is as follows (amounts in thousands):

Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

Accumulated Other Comprehensive Loss, beginning $ — $ — $ ( 3,324 )

Increase to interest expense (net of tax benefit of $ 980.0 million for the year ended January 29, 2022)

Accumulated Other Comprehensive Loss, ending $ — $ — $ —

Fair Value Measurements

11 unchanged sentences

Government treasury bills and securities, which are classified as cash and redeemable on demand.

We held investments in money market funds of $ 303.4 million and $ 95.6 million as of February 3, 2024 and January 28, 2023, respectively.

We held investments in money market funds of $ 256.9 million and $ 303.4 million as of February 1, 2025 and February 3, 2024, respectively.

The fair value of the Term Loan and Notes is estimated using a discounted cash flow analysis based on quoted market prices for the instrument in an inactive market and is therefore classified as Level 2 within the fair value hierarchy.

As of February 3, 2024 and January 28, 2023, the estimated fair value of the Term Loan and Notes was $ 0.5 billion and $ 0.6 billion, respectively.

As of February 1, 2025 and February 3, 2024, the estimated fair value of the Term Loan and Notes was $ 0.5 billion and $ 0.5 billion, respectively.

As borrowings on the ABL Facility are generally repaid in less than 12 months, we believe that fair value approximates the carrying value.

1 unchanged sentence

Property and equipment consists of the following (amounts in thousands) as of:

February 3, 2024 January 28, 2023

February 1, 2025 February 3, 2024

Leasehold improvements $ 663,869 $ 571,785

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Accrued expenses and other current liabilities consist of the following (amounts in thousands) as of:

February 3, 2024 January 28, 2023

February 1, 2025 February 3, 2024

Accrued interest $ 7,634 $ 6,717

13 unchanged sentences

The plan reserved a total of 5,150,000 shares of common stock for issuance.

Concurrent with the adoption of the 2020 Omnibus Incentive Plan, the previously existing share-based compensation plan, the NAHC 2011 Unit Incentive Plan (the "2011 Unit Incentive Plan"), was frozen and no further issuances will be permitted as part of the 2011 Unit Incentive Plan.

On June 1, 2023, our stockholders approved the First Amendment to the 2020 Omnibus Incentive Plan, which, among other changes, increased the number of shares available for issuance thereunder by 2,600,000 shares.

5 unchanged sentences

Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

February 1, 2025 February 3, 2024 January 28, 2023

Equity compensation expense (1)

2 unchanged sentences

(1) These costs are included within selling, general and administrative expenses in the Consolidated Statements of Income.

(2) These costs include approximately $ 24.9 million in non-cash expenses related to the 2021 Vesting Event, which occurred during the 2021 second quarter (see Note 1).

As of February 1, 2025, unrecognized compensation cost related to non-vested share-based compensation awards of $ 33.9 million is expected to be recognized over a weighted average life of two years .

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Board of Directors.

On August 28, 2020, NAHC paid a $ 257.0 million distribution to its members of record as of August 25, 2020.

Holders of the outstanding granted equity Awards were entitled to receive value equal to $ 3.546 per share on a post-IPO basis, which was made in the form of cash payments, additional Restricted Unit grants or Unit Option exercise price adjustments.

Cash payments due for unvested Awards were paid upon vesting of such Awards.

Cash payments for vested Unit Options and vested Restricted Units ("Share-Based Award Payments") of $ 32.2 million were paid in-full as of July 31, 2021.

Service Option Fair Value Assumptions

5 unchanged sentences

In 2022 and 2023, the dividend yield was based on the most recent annualized quarterly dividend and the valuation date closing stock price.

In 2021, the dividend yield was based on the expectation that no dividends will be paid.

The assumptions used to calculate the fair value of Service Options granted are evaluated and modified, as necessary, to reflect current market conditions and experience.

The following table presents the assumptions and grant date fair values for Service Options granted in 2023, 2022 and 2021:

The following table presents the assumptions and grant date fair values for Service Options granted in 2023 and 2022 (the Company did not grant any Service Options in 2024):

Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

February 3, 2024 January 28, 2023

Expected life in years 6.0 6.2

3 unchanged sentences

2.4 % to 4.1 %

1.0 % to 1.3 %

Dividend yield 0.6 % 0.8 %

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Exercised ( 988,682 ) 20.00 $ 36,277

Outstanding as of January 28, 2023 3,570,694 $ 24.27 7.3 $ 112,050

Outstanding as of February 3, 2024 2,615,798 $ 27.99 6.7 $ 95,479

Granted or modified — —

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Exercised ( 95,915 ) 16.63 $ 3,656

Outstanding as of January 28, 2023 218,477 $ 16.59 5.5 $ 8,534

Outstanding as of February 3, 2024 122,562 $ 16.55 5.0 $ 5,874

Granted or modified — —

7 unchanged sentences

Therefore, the number of awards vested and expected to vest is equal to the awards outstanding.

The total income tax benefit recognized from the exercise of stock options was $ 3.9 million, $ 4.2 million and $ 18.5 million for the fiscal years ended February 3, 2024, January 28, 2023 and January 29, 2022, respectively.

The total income tax benefit recognized from the exercise of stock options was $ 1.3 million, $ 3.9 million and $ 4.2 million for the fiscal years ended February 1, 2025, February 3, 2024 and January 28, 2023, respectively.

Restricted Unit Activity

10 unchanged sentences

Forfeited ( 92,151 ) 51.32 — — ( 88,301 ) 47.94

Non-vested as of January 28, 2023 437,108 $ 39.11 — $ — 298,929 $ 32.55

Non-vested as of February 3, 2024 564,863 $ 51.80 — $ — 311,822 $ 48.85

Granted 435,520 62.86 — — 129,041 65.48

5 unchanged sentences

In more limited grants, Service Restricted Units vest 100 % on the first anniversary of the grant date, or, if earlier, the business day immediately preceding the following annual meeting of stockholders.

The Company’s outstanding and unvested Performance Restricted Units typically vest either (i) if granted during 2023, on the third anniversary of the Performance Restricted Unit holder's vesting commencement date, or (ii) if granted prior to 2023, ratably over a four-year period on each anniversary of the Performance Restricted Unit holder’s vesting commencement date, so long as the Company achieved (a) the performance metric for the performance period or (b) achieves a stated target share price.

The Company’s outstanding and unvested Performance Restricted Units typically vest either (i) if granted during 2023 or 2024, on the third anniversary of the Performance Restricted Unit's performance period if the Company achieves the performance metrics for the performance period, or (ii) if granted prior to 2023, annually each year on the vesting commencement date, so long as the Company achieved (a) the performance metric for the performance period or (b) achieves a stated target share price.

In the event of certain Company change of control transactions, the Company's then-outstanding and unvested Awards will become fully vested and exercisable subject to certain criteria (as defined in the award agreements).

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Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

February 1, 2025 February 3, 2024 January 28, 2023

Net income $ 418,447 $ 519,190 $ 628,001

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Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

February 1, 2025 February 3, 2024 January 28, 2023

Current expense:

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Foreign 64 19 20

Total current expense 148,213 148,488 108,669

Total current expense (a)

81,943 148,213 148,488

Deferred expense (benefit):

2 unchanged sentences

Foreign — ( 35 ) 7

Total deferred expense ( 4,247 ) 41,831 79,490

Total deferred expense (a)

37,835 ( 4,247 ) 41,831

Income tax expense $ 119,778 $ 143,966 $ 190,319

The Company purchased $ 38.1 million of energy credits under the new Inflation Reduction Act related to tax years ending February 3, 2024 and February 1, 2025 for a total purchase price of $ 35.8 million, resulting in a net tax benefit of $ 2.3 million.

A reconciliation of the statutory U.S.

1 unchanged sentence

Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

February 1, 2025 February 3, 2024 January 28, 2023

Federal income tax at the statutory rate 21.0 % 21.0 % 21.0 %

2 unchanged sentences

Excess tax benefit for share-based compensation ( 0.4 ) ( 1.1 ) ( 0.7 )

Tax credits ( 1.3 ) ( 0.5 ) ( 0.1 )

Effect of other permanent items ( 0.4 ) ( 0.7 ) —

1 unchanged sentence

Components of deferred tax assets and liabilities consist of the following (amounts in thousands) as of:

February 3, 2024 January 28, 2023

February 1, 2025 February 3, 2024

Deferred tax assets:

2 unchanged sentences

Equity compensation 9,934 7,672

Other 1,389 —

Total deferred tax assets 31,790 27,102

12 unchanged sentences

The statute of limitations is open for federal and state tax audits for the tax fiscal years ending 2022 through 2024, and 2021 through 2024, respectively.

With the exception of one retail store which we own, we lease all of our retail stores, distribution centers and corporate offices.

With the exception of two retail stores which we own, we lease all of our retail stores, distribution centers and corporate offices.

Our leases primarily relate to building leases, which generally include options to renew at our sole discretion for five years or more.

5 unchanged sentences

Our sublease portfolio consists mainly of former store locations for which we are still under lease and existing store leases in which we have excess or unused space.

The components of lease expense and sublease income included in selling, general and administrative ("SG&A") expenses on our statement of income is as follows (amounts in thousands):

During the fourth quarter of 2024, we closed on a sale-leaseback agreement involving a store property in Cypress, Texas.

We determined that the transaction met the accounting criteria for sale-leaseback treatment and we recognized a net gain of approximately $ 7.1 million in Selling, General, and Administrative expenses on the Consolidated Statements of Income.

The components of lease expense and sublease income included in SG&A expenses and cost of goods sold on our statement of income is as follows (amounts in thousands):

Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

February 1, 2025 February 3, 2024 January 28, 2023

Operating lease expense $ 222,709 $ 214,672 $ 201,398

5 unchanged sentences

Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

February 1, 2025 February 3, 2024 January 28, 2023

Right-of-use assets obtained in exchange for new operating lease liabilities $ 214,747 $ 134,181 $ 116,652

Cash paid for amounts included in the measurement of operating lease liabilities $ 224,942 $ 213,860 $ 204,159

February 3, 2024 January 28, 2023

February 1, 2025 February 3, 2024

Weighted-average remaining lease term in years 9.6 9.5

10 unchanged sentences

As of February 1, 2025, the future minimum lease payments on these leases approximated $ 274.0 million.

Related Party Transactions

On May 5, 2021, and September 14, 2021, in connection with the May 2021 Secondary Offering and the September 2021 Secondary Offering, respectively, the Company entered into Underwriting Agreements with affiliates of KKR (as selling stockholders), several other selling stockholders named therein, and several underwriters named therein, including KCM (as underwriter).

The May 2021 Secondary Offering and September 2021 Secondary Offering were completed on May 10, 2021, and September 17, 2021, respectively.

The Company did not pay KCM any fees in connection with these secondary offerings.

In connection with the May 2021 Secondary Offering, we repurchased from the underwriters 3,229,974 shares of ASO, Inc.

common stock at $ 30.96 per share for approximately $ 100.0 million.

In connection with the September 2021 Secondary Offering, we repurchased from the underwriters 4,500,000 shares of ASO, Inc.

common stock at approximately $ 43.52 for approximately $ 195.8 million.

The shares repurchased in both the May 2021 Secondary Offering and the September 2021 Secondary Offering were immediately retired by the Company (see Note 1 and Note 2).

Commitments and Contingencies

14 unchanged sentences

In addition, government agencies and self-regulatory organizations have the ability to conduct periodic examinations of and administrative proceedings regarding our business.

In May and December 2023, U.S.

Customs and Border Protection ("CBP") notified us that we owed additional duties relating to certain products that we imported from China that CBP believes are subject to certain anti-dumping and/or countervailing duties.

We do not believe that these products are subject to such duties and are contesting CBP’s determination vigorously.

While we contest CBP’s determination, we were required to deposit with CBP an amount of duties relating to these products, which are included in prepaid expenses and other current assets on the Company’s consolidated balance sheet while this matter is pending.

We anticipate that this matter will be resolved without a material adverse effect on our financial position, results of operations or cash flows.

However, the ultimate outcome of this matter cannot be determined at this time, and we cannot assure you that we will be successful in contesting CBP's determination or that we will not need to accrue or pay additional amounts in the future.

During 2023, the Company settled a legal matter pertaining to the overcharge of interchange feeds with certain financial institutions for prior periods dating back to 2004.

As previously disclosed, in May and December 2023, U.S.

Customs and Border Protection (“CBP”) notified us that we owed additional duties relating to certain products that we imported from China that CBP believed were subject to certain anti-dumping and/or countervailing duties.

While we contested CBP’s determination, we were required to deposit with CBP duties relating to these products (the “AD/CVD deposits”), which are included in prepaid expenses and other current assets on the Company’s Consolidated Balance Sheets.

In January 2024, we requested a changed circumstances review of CBP’s determination by the U.S.

Department of Commerce (the “DOC”).

In April 2024, the DOC made a determination in the Company’s favor in connection with the changed circumstances review, and in May 2024, instructed CBP to begin the process of issuing refunds to the Company on the AD/CVD deposits.

In August 2024, the Company received a full refund of the AD/CVD deposits.

This matter is now resolved, and the refund has been recorded as cash within cash and cash equivalents on our Consolidated Balance Sheets.

In January 2025, the Company settled a legal matter with a third-party vendor.

In connection with this settlement, we recognized a net gain of approximately $ 15.0 million in Other (income), net on the Consolidated Statements of Income, when the gain became realizable.

13 unchanged sentences

Employer contributions related to the 401(k) Plan totaled $ 15.7 million, $ 15.5 million and $ 15.5 million in 2024, 2023 and 2022, respectively.

Segment Information

The Company’s retail operations represent one operating segment and one reportable segment, which derives revenues from customers by selling full-line sporting goods and outdoor recreational products.

The Company’s retail stores and online selling channels sell similar products and services, use similar selling processes, and sell to similar classes of customers.

See Note 1 to the consolidated financial statements for information related to the products and services offered as well as business operations.

The accounting policies of the Company's single reportable segment are the same as those described in the summary of significant accounting policies in Note 2 to the consolidated financial statements.

All intercompany transactions within the single reportable segment are eliminated upon consolidation.

The Company’s chief operating decision maker (the “CODM”) is the Chief Executive Officer.

The CODM allocates resources and assesses performance at a Company level using consolidated net income, which is a GAAP measure, as reported on the Consolidated Statements of Income.

The CODM evaluates the Company's assets as reported on the Company's Consolidated Balance Sheets.

The CODM evaluates significant segment expenses and makes decisions about the retail business based on the cost of goods we sell and the selling, general, and administrative expenses needed to sell those goods as reported on the Consolidated Statements of Income.

See the Company's consolidated financial statements included in Part IV Item 15 for more information.

Selected Quarterly Financial Data (Unaudited)

24 unchanged sentences

Diluted 79,288 78,091 76,057 76,035

(1) Net income for the quarter ended February 1, 2025, includes a $ 15.0 million gain pertaining to a litigation settlement and a $ 7.1 million gain on a sale-leaseback transaction, both of which occurred in the fourth quarter of 2024 (see Note 2).

(2) Net income for the quarter ended February 3, 2024, includes a $ 15.9 million net gain relative to a credit card fee litigation settlement which occurred in the fourth quarter of 2023 (see Note 2).

(2) Net income for the year ended January 28, 2023, included a $ 7.2 million gain from a business interruption insurance recovery and a $ 3.7 million gain from the sale of a tariff relief litigation claim, both of which occurred in the fourth quarter of 2022 (see Note 2).

Subsequent Events

1 unchanged sentence

On March 6, 2025 the Company's Board of Directors declared a quarterly cash dividend in the amount of $ 0.13 per share on the Company's common stock, payable on April 17, 2025 to stockholders of record as of the close of business on March 25, 2025.

On March 8, 2024 Academy, Ltd.

(“Academy”), a wholly-owned subsidiary of Academy Sports and Outdoors, Inc., as borrower, New Academy Holding Company, LLC, Associated Investors, L.L.C.

Form 10–K Summary

3 unchanged sentences

Certificate of Change of Registered Agent and/or Registered Office of the Registrant (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on June 1, 2023).

Amended and Restated Bylaws of the Registrant (incorporated by reference to Exhibit 3.2 to the Registrant’s Quarterly Report on Form 10-Q filed on December 6, 2022).

Amended and Restated Bylaws of the Registrant (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on March 7, 2025).

Indenture, dated as of November 6, 2020, by and among Academy, Ltd., as issuer, the guarantors named therein and The Bank of New York Mellon Trust Company, N.A., as trustee and notes collateral agent (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed on November 6, 2020).

79 unchanged sentences

Hicks Amended and Restated Employment Agreement, dated April 26, 2023 (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on April 27, 2023).

Mullican Amended and Restated Employment Agreement, dated April 26, 2023 (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed on April 27, 2023).

Steven (Steve) P.

3 unchanged sentences

Earl Carlton (Carl) Ford, IV Employment Agreement, dated July 6, 2023 (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on July 11, 2023).

Exhibit Number Description of Exhibit

Manish Maini Employment Agreement, dated May 25, 2017 (incorporated by reference to Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q filed on September 7, 2022).

2020 Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.34 to Amendment No.

1 to the Registrant’s Registration Statement on Form S-1 filed on September 23, 2020).

Exhibit Number Description of Exhibit

Form of Director and Officer Indemnification Agreement (incorporated by reference to Exhibit 10.37 to Amendment No.

1 to the Registrant’s Registration Statement on Form S-1 filed on September 23, 2020).

Non-Employee Director Compensation Policy, effective March 18, 2024.

Non-Employee Director Compensation Policy, effective March 18, 2024 (incorporated by reference to Exhibit 10.66 to the Registrant's Annual Report on Form 10-K filed on March 21, 2024).

Matt McCabe Amended and Restated Employment Agreement, dated June 25, 2023 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed on June 11, 2024).

Insider Trading Policy

Subsidiaries of the Registrant.

6 unchanged sentences

Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Policy Relating to Recovery of Erroneously Awarded Compensation.

Policy Relating to Recovery of Erroneously Awarded Compensation (incorporated by reference to Exhibit 97.1 to the Registrant's Annual Report on Form 10-K filed on March 21, 2024).

101.INS XBRL Instance Document - The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

22 unchanged sentences

Earl Carlton Ford, IV (principal financial officer and principal accounting officer)

HICKS Executive Chairman March 21, 2024

HICKS Chairman of the Board

March 20, 2025

BECK Director March 20, 2025

/s/ SCOTT BOATWRIGHT

Director March 20, 2025

Scott Boatwright

MARLEY Director March 20, 2025

2 unchanged sentences

PALERMO Director March 20, 2025

/s/ MONIQUE PICOU

Director March 20, 2025

Monique Picou

RAFF Director March 20, 2025

10 unchanged sentences

Self-insurance reserves 25,010 74,941 ( 74,719 ) (4) 25,232

January 28, 2023:

February 3, 2024:

Allowance for doubtful accounts $ 2,004 $ 1,107 $ ( 894 ) (1) $ 2,217

9 unchanged sentences

(2) Represents the monthly increase (decrease) in the required reserve based on the Company's evaluation of anticipated merchandise returns.

(3) Represents the actual inventory shrinkage experienced at the time of physical inventories.

(3) Represents the actual inventory shrinkage experienced at stores.

(4) Represents claim payments for self-insured claims.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures