Hardware hardware signage appears on a monitor of the floor of the New York Stock Exchange in New York, February 24, 2017.
Michael Nagle | Bloomberg | Getty Images
RH, formerly known as Restoration Hardware, announced on Thursday that it is considering a $ 300 million convertible note due in 2024.
The proceeds from the offering will be used primarily to withdraw the company's $ 200 million other bail debts and reduce outstanding loans from the credit facility, RH said in a press release. The move could lower interest expenses by around $ 6.5 million in the back half of fiscal 201
If the offer is successful, the lower interest expense will make it possible to increase the earnings forecast between SEK 20 and SEK 25 per share this year and between SEK 65 and SEK 70 per share in fiscal 2020.  RH recently reported revenue in the second quarter that beat expectations. It earned $ 3.20 per share, excluding items, on revenue of $ 707 million, and top estimates that required $ 2.70 earnings per share of $ 697.8 million in revenue.
In the report, the company suggested that, although comfortable with the balance sheets, the market conditions for convertible debt seemed attractive to them.
The home furnishing company has taken steps to diversify its offerings, including introducing RH Beach House, a collection of coastal living furniture. The New York Gallery, which opened in 2018, continues to "comfortably train in excess of $ 100 million in annual revenue for the 2019 fiscal year and will generate more than $ 30 million in cash in the first full fiscal year," it recently said.
The company said it is on track to open several of its mansion-like, multi-story galleries with restaurants and rooftop parks in locations including Minneapolis, Columbus, Ohio and Edina, Minnesota, by the end of the year.
Before RH shares were stopped for news on Thursday, the 52-week high was. The stock pared the gains in a short time when trading resumed, but shares rose by about 3% in afternoon trading. The stock has risen by 44% since the beginning of the year, bringing it to a market share of $ 3.2 billion.