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RH is looking into a $300 million notes offering to pay down debt


Restoration Hardware signage is displayed on a monitor of the floor of the New York Stock Exchange in New York, Feb. 24, 2017.

Michael Nagle | Bloomberg | Getty Images

RH, formerly known as Restoration Hardware, announced Thursday it is considering a $300 million convertible notes offering due in 2024.

The proceeds from the offering would be used to retire the company's $200 million of outstanding debt, the company said in a press release. The move could lower interest expenses by about $6.5 million in the back half of fiscal 2019.

If it goes through with the offering, the lower interest expense would allow it to boost its earnings forecast  between 20 cents and 25 cents per share this year and between 65 cents and 70 cents per share in fiscal 2020.

RH recently reported second-quarter earnings that beat expectations. It earned $3.20 per share, excluding items, on revenue of $707 million, topping estimates that called for earnings of $2.70 per share on $697.8 million in revenue.

The home furnishings company has also made moves to diversify its offerings, including introducing RH Beach House, a collection of coastal living furnishings.

Before the trading of the stock halted, it had already risen 3% and hit a 52-week high. Its stock is up 44% since the beginning of the year, bringing it to a market cap of $3.2 billion.


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