THE BRAND HOUSE COLLECTIVE PROVIDES BUSINESS UPDATE

Bed Bath & Beyond Home Grand Opening Surpasses Expectations, Underscoring Brand Strength

Kirkland's Home IP Sale Accelerates Conversions and Unlocks Wholesale Expansion

Reports Q2 Fiscal 2025 Financial Results

NASHVILLE, Tenn., Sept. 16, 2025 /PRNewswire/ -- The Brand House Collective, Inc. (Nasdaq: TBHC) ("Brand House Collective" or the "Company"), formerly Kirkland's, Inc., announced recent business highlights including the successful grand opening for its first Bed Bath & Beyond Home store and the sale of the Kirkland's Home intellectual property to Bed Bath & Beyond, Inc. ("Beyond"). In addition, the Company announced its financial results for the 13-week and 26-week periods ended August 2, 2025.

Amy Sullivan, CEO of Brand House Collective, said, "The debut of our first Bed Bath & Beyond Home store was met with overwhelming demand, exceeding our expectations, and generating nationwide excitement that affirms the strength of this iconic brand. That early success gives us confidence to accelerate the conversion of Kirkland's Home stores. We are also unlocking new opportunities by monetizing the Kirkland's Home name, both inside Bed Bath & Beyond stores and through wholesale partnerships with independent retailers, creating an exciting new chapter for a brand with a 60-year legacy. This is just the beginning of what's ahead."

Recent Business Highlights

Second Quarter 2025 Financial Results

Ms. Sullivan commented, "Our Q2 results reflect two major events that weighed heavily on the quarter: the tornado damage at our distribution center and our deliberate decision to liquidate select inventory ahead of expanding Bed Bath & Beyond assortments. Together, these factors were the dominant drivers of the year-over-year decline in profitability and created near-term pressure on sales, particularly in e-commerce. While the tornado was a one-time disruption, our inventory actions are intentionally reallocating space and capital to Bed Bath & Beyond assortments that we believe will drive stronger growth ahead."

Balance Sheet

*Non-GAAP financial measures. Please see "Non-GAAP Financial Measures" and "Reconciliation of GAAP Net Income to Adjusted EBITDA" and "Reconciliation of GAAP Net Income to Adjusted Net Income" for more information.

Conference Call

The Brand House Collective's management will host a conference call to discuss its financial results for the second quarter ended August 2, 2025, followed by a question-and-answer period with President and CEO, Amy Sullivan, and SVP and CFO, Andrea Courtois.

Date: Tuesday, September 16, 2025

Time: 9:00 a.m. Eastern Time

Toll-free dial-in number: (855) 560-2577

International dial-in number: (412) 542-4163

Please call the conference telephone number 10-15 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact ICR at TBHC@icrinc.com.

The conference call will be broadcast live and available for replay here and via the investor relations section of the Company's website at www.kirklands.com. The online replay will follow shortly after the call and continue for one year.

A telephonic replay of the conference call will be available after the conference call through September 23, 2025.

Toll-free replay number: (877) 344-7529

International replay number: (412) 317-0088

Replay ID: 7522303

Contact:

Investor Relations

The Brand House Collective, Inc.

Andrea Courtois

1-615-872-4800

Investor Relations

ICR

Caitlin Churchill

TBHC@icrinc.com

1-203-682-8200

Media

The Brand House Collective, Inc.

media@brandhouseco.com

About The Brand House Collective, Inc.

The Brand House Collective, Inc., formerly Kirkland's Inc., is a multi-brand merchandising, supply chain and retail operator, managing a portfolio of iconic home and family brands including Kirkland's Home and Bed Bath & Beyond Inc.'s Bed Bath & Beyond Home, Bed Bath & Beyond, buybuy Baby, and Overstock. Currently operating more than 300 stores across 35 states as well as e-commerce sites, www.kirklands.com and www.bedbathandbeyondhome.com, the Company offers distinctive brand experiences providing curated, high-quality product assortments for every room, every moment, and for every budget. More information can be found at www.kirklands.com.

Forward-Looking Statements

Except for historical information contained herein, certain statements in this release, constitute forward-looking statements that are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are subject to the finalization of the Company's quarterly financial and accounting procedures. Forward-looking statements deal with potential future circumstances and developments and are, accordingly, forward-looking in nature. You are cautioned that such forward-looking statements, which may be identified by words such as "anticipate," "believe," "expect," "estimate," "intend," "plan," "seek," "may," "could," "strategy," and similar expressions, involve known and unknown risks and uncertainties, many of which are outside of the Company's control, which may cause the Company's actual results to differ materially from forecasted results. Those risks and uncertainties include, among other things, risks associated with the effect of the transactions entered into with Beyond (the "Transactions") on the Company's business relationships; operating results and business generally; unexpected costs, charges or expenses resulting from the Transactions; potential litigation relating to the Transactions that could be instituted against Beyond, the Company or their affiliates' respective directors, managers or officers, including the effects of any outcomes related thereto; continued availability of capital and financing; the ability to obtain the various synergies envisioned between the Company and Beyond; the ability of the Company to successfully open new stores or rebrand or operate existing Kirkland's Home stores under a Bed Bath & Beyond Home or other licensed brand; the ability of the Company to successfully market its products to new customers and expand through new e-commerce platforms and to implement its plans, forecasts and other expectations with respect to its business after the completion of the Transactions and realize additional opportunities for growth and innovation; risks associated with the Company's liquidity including cash flows from operations and the amount of borrowings under the secured revolving credit facility; the fact that our independent registered public accounting firm's report for the year ended February 1, 2025 is qualified as to our ability to continue as a going concern; the Company's ability to successfully implement cost savings and other strategic initiatives intended to improve operating results and liquidity positions; the Company's actual and anticipated progress towards its short-term and long-term objectives including its multi-brand and omni-channel strategy; the risk that natural disasters, pandemic outbreaks, global political events, war and terrorism could impact the Company's revenues, inventory and supply chain; the continuing consumer impact of inflation and countermeasures, including high interest rates; the effectiveness of the Company's marketing campaigns; risks related to changes in U.S. policy related to imported merchandise, particularly with regard to the impact of tariffs on goods imported from China and strategies undertaken to mitigate such impact; the Company's ability to retain its senior management team; volatility in the price of the Company's common stock, the competitive environment in the home décor industry in general and in the Company's specific market areas; inflation, fluctuations in cost and availability of inventory; increased transportation costs and potential interruptions in supply chain, distribution systems and delivery network, including the Company's e-commerce systems and channels; the ability to control employment and other operating costs; availability of suitable retail locations and other growth opportunities; disruptions in information technology systems including the potential for security breaches of the Company's information or its customers' information, seasonal fluctuations in consumer spending, and economic conditions in general. Those and other risks are more fully described in the Company's filings with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K filed on May 2, 2025, as amended on May 30, 2025, and subsequent reports. Forward-looking statements included in this release are made as of the date of this release. Any changes in assumptions or factors on which such statements are based could produce materially different results. Except as required by law, the Company disclaims any obligation to update any such factors or to publicly announce results of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.

THE BRAND HOUSE COLLECTIVE, INC.

UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

‌

13-Week Period Ended

August 2,

August 3,

2025

2024

Net sales

75,788

86,289

Cost of sales

63,419

68,629

Gross profit

12,369

17,660

Operating expenses:

Compensation and benefits

17,827

18,653

Other operating expenses

12,643

11,384

Depreciation (exclusive of depreciation included in cost of sales)

591

925

Asset impairment

Total operating expenses

31,113

30,982

Operating loss

(18,744)

(13,322)

Interest expense

1,464

1,420

Other income

(39)

(120)

Loss before income taxes

(20,169)

(14,622)

Income tax expense (benefit)

(118)

Net loss

(20,179)

(14,504)

Loss per share:

Basic

(0.90)

(1.11)

Diluted

(0.90)

(1.11)

Weighted average shares outstanding:

Basic

22,460

13,074

Diluted

22,460

13,074

THE BRAND HOUSE COLLECTIVE, INC.

UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

‌

26-Week Period Ended

August 2,

August 3,

2025

2024

Net sales

157,292

178,042

Cost of sales

124,639

133,314

Gross profit

32,653

44,728

Operating expenses:

Compensation and benefits

35,681

37,939

Other operating expenses

24,909

25,702

Depreciation (exclusive of depreciation included in cost of sales)

1,251

1,886

Asset impairment

Total operating expenses

61,913

65,558

Operating loss

(29,260)

(20,830)

Interest expense

2,812

2,547

Other income

(123)

(236)

Loss before income taxes

(31,949)

(23,141)

Income tax expense

193

Net loss

(32,003)

(23,334)

Loss per share:

Basic

(1.44)

(1.79)

Diluted

(1.44)

(1.79)

Weighted average shares outstanding:

Basic

22,277

13,019

Diluted

22,277

13,019

THE BRAND HOUSE COLLECTIVE, INC.

UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS

(In thousands)

‌

August 2,

February 1,

August 3,

2025

2024

ASSETS

Current assets:

Cash and cash equivalents

3,641

3,820

4,461

Inventories, net

81,693

81,899

92,760

Prepaid expenses and other current assets

6,312

5,585

8,216

Total current assets

91,646

91,304

105,437

Property and equipment, net

18,749

22,062

25,454

Operating lease right-of-use assets

108,672

121,229

128,046

Other assets

2,863

7,593

7,282

Total assets

221,930

242,188

266,219

LIABILITIES AND SHAREHOLDERS' DEFICIT

Current liabilities:

Accounts payable

56,583

43,935

59,967

Accrued expenses and other liabilities

21,386

20,183

20,956

Operating lease liabilities

37,372

39,355

38,602

Related party debt

1,541

—

Current debt, net

—

49,199

—

Total current liabilities

116,882

152,672

119,525

Operating lease liabilities

83,100

95,085

100,565

Related party debt, net

11,895

—

Long-term debt, net

41,520

10,003

61,396

Other liabilities

3,694

3,445

4,438

Total liabilities

257,091

261,205

285,924

Shareholders' deficit

(35,161)

(19,017)

(19,705)

Total liabilities and shareholders' deficit

221,930

242,188

266,219

THE BRAND HOUSE COLLECTIVE, INC.

UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(In thousands)

‌

26-Week Period Ended

August 2,

August 3,

2025

2024

Cash flows from operating activities:

Net loss

(32,003)

(23,334)

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation of property and equipment

4,150

5,137

Amortization of debt issuance and original issue discount costs

843

256

Asset impairment

Gain (loss) on disposal of property and equipment

(7)

Stock-based compensation expense

321

556

Changes in assets and liabilities:

Inventories, net

206

(18,670)

Prepaid expenses and other current assets

(727)

(613)

Accounts payable

12,403

14,514

Accrued expenses

1,261

(2,207)

Operating lease assets and liabilities

(1,411)

(1,990)

Other assets and liabilities

4,800

(61)

Net cash used in operating activities

(10,066)

(26,388)

‌

Cash flows from investing activities:

Proceeds from sale of property and equipment

Capital expenditures

(1,026)

(1,193)

Net cash used in investing activities

(1,008)

(1,176)

‌

Cash flows from financing activities:

Borrowings on revolving line of credit

88,644

22,800

Repayments on revolving line of credit

(90,124)

(4,100)

Borrowings on term loans

5,000

10,000

Payments of debt and equity issuance costs

(570)

(429)

Cash used in net share settlement of stock options and restricted stock units

(55)

(51)

Proceeds from issuance of common stock

8,000

—

Net cash provided by financing activities

10,895

28,220

‌

Cash and cash equivalents:

Net (decrease) increase

(179)

656

Beginning of the period

3,820

3,805

End of the period

3,641

4,461

‌

Supplemental schedule of non-cash activities:

Non-cash accruals for purchases of property and equipment

325

227

Non-cash accruals for debt and equity issuance costs

632

830

‌

Conversion of convertible note, accrued interest and unamortized debt issuance costs into

common stock

6,676

—

Common stock issued in exchange for equity issuance costs

574

—

Non-GAAP Financial Measures

To supplement our unaudited consolidated condensed financial statements presented in accordance with generally accepted accounting principles ("GAAP"), this earnings release contains certain non-GAAP financial measures, including EBITDA, adjusted EBITDA, adjusted operating loss, adjusted net loss and adjusted diluted loss per share. These measures are not in accordance with, and are not intended as alternatives to, GAAP financial measures. The Company uses these non-GAAP financial measures internally in analyzing our financial results and believes that they provide useful information to analysts and investors, as a supplement to GAAP financial measures, in evaluating the Company's operational performance.

The Company defines EBITDA as net loss before income tax expense, interest expense, other income and depreciation. Adjusted EBITDA is defined as EBITDA adjusted to remove asset impairment, stock-based compensation expense (due to the non-cash nature of this expense), severance charges (as it fluctuates based on the needs of the business and does not represent a normal recurring operating expense), tornado related costs (as these do not represent a normal recurring expenses), and any financing related legal or professional fees that, due to their nature, did not qualify for capitalization as deferred debt or equity issuance costs.

Adjusted operating loss is defined as operating loss adjusted for asset impairment, stock-based compensation expense, severance charges, tornado related costs and financing related legal or professional fees not qualifying for capitalization. The Company defines adjusted net loss as net loss adjusted for asset impairment, stock-based compensation expense, severance charges, tornado related costs, financing related legal or professional fees not qualifying for capitalization and the related tax adjustments. The Company defines adjusted loss per diluted share as adjusted net loss divided by weighted average diluted share count.

Non-GAAP financial measures are intended to provide additional information only and do not have any standard meanings prescribed by GAAP. Use of these terms may differ from similar measures reported by other companies. Each non-GAAP financial measure has its limitations as an analytical tool, and you should not consider them in isolation or as a substitute for analysis of the Company's results as reported under GAAP.

The following table shows an unaudited non-GAAP measure reconciliation of net loss to EBITDA and adjusted EBITDA (in thousands) for the periods indicated:

13-Week Period Ended

26-Week Period Ended

August 2,

2025

August 3,

2024

August 2,

2025

August 3,

2024

Net loss

(20,179)

(14,504)

(32,003)

(23,334)

Income tax expense (benefit)

(118)

193

Interest expense

1,464

1,420

2,812

2,547

Other income

(39)

(120)

(123)

(236)

Depreciation

2,060

2,513

4,150

5,137

EBITDA

(16,684)

(10,809)

(25,110)

(15,693)

Adjustments:

Asset impairment (1)

Stock-based compensation expense (2)

264

321

556

Beyond transaction costs not subject to capitalization (3)

100

—

229

—

Severance charges (4)

157

317

283

390

Tornado expenses, net (5)

1,974

—

1,974

—

Total adjustments

2,365

601

2,879

977

Adjusted EBITDA

(14,319)

(10,208)

(22,231)

(14,716)

The following table shows an unaudited non-GAAP measure reconciliation of operating loss to adjusted operating loss (in thousands) for the periods indicated:

13-Week Period Ended

26-Week Period Ended

August 2,

2025

August 3,

2024

August 2,

2025

August 3,

2024

Operating loss

(18,744)

(13,322)

(29,260)

(20,830)

Adjustments:

Asset impairment (1)

Stock-based compensation expense (2)

264

321

556

Beyond transaction costs not subject to capitalization (3)

100

—

229

—

Severance charges (4)

157

317

283

390

Tornado expenses, net (5)

1,974

—

1,974

—

Total adjustments

2,365

601

2,879

977

Adjusted operating loss

(16,379)

(12,721)

(26,381)

(19,853)

The following table shows an unaudited non-GAAP measure reconciliation of net loss and diluted loss per share to adjusted net loss and adjusted diluted loss per share (in thousands, except per share data) for the periods indicated:

13-Week Period Ended

26-Week Period Ended

August 2,

2025

August 3,

2024

August 2,

2025

August 3,

2024

Net loss

(20,179)

(14,504)

(32,003)

(23,334)

Adjustments:

Asset impairment (1)

Stock-based compensation expense (2)

264

321

556

Beyond transaction costs not qualifying for capitalization (3)

100

—

229

—

Severance charges (4)

157

317

283

390

Tornado expenses, net (5)

1,974

—

1,974

—

Total adjustments

2,365

601

2,879

977

Tax benefit of adjustments

Total adjustments, net of tax

2,375

605

2,899

995

Adjusted net loss

(17,804)

(13,899)

(29,104)

(22,339)

Diluted loss per share

(0.90)

(1.11)

(1.44)

(1.79)

Adjusted diluted loss per share

(0.79)

(1.06)

(1.31)

(1.72)

Diluted weighted average shares outstanding

22,460

13,074

22,277

13,019

(1)

Asset impairment charges are related to store property and equipment.

(2)

Stock-based compensation expense includes amounts amortized to expense related to equity incentive plans.

(3)

Consulting and legal fees incurred relating to the Company's transactions with Beyond that, due to their nature, did not qualify for capitalization as deferred debt or equity issuance costs. Given the magnitude and scope of these strategic transactions, the Company considers the incremental consulting and legal fees incurred not reflective of the ongoing costs to operate its business.

(4)

Severance charges include expenses related to severance agreements and permanent store closure compensation costs.

(5)

Tornado related costs include the write-off of damaged inventory, a component of cost of sales, and expenses to move product to temporary storage and professional fees to secure and repair the damage caused by the tornado that damaged the Company's distribution center in Jackson, Tennessee on May 20, 2025 which are recorded in other operating expenses, net of insurance proceeds.

SOURCE The Brand House Collective, Inc.