The Children's Place Retail Stores, Inc. Reports First Quarter 2009 Financial Results
SECAUCUS, N.J.,
- Net sales from continuing operations for the first quarter of 2009
were
$401.9 million , slightly above the previous year's first quarter net sales of$400.2 million . - Comparable retail sales, which include online sales, increased 1% in the first quarter of 2009, on top of a 6% increase during the same period last year.
- Income from continuing operations after tax was
$23.7 million , or$0.80 per diluted share, in the first quarter of 2009, compared to$19.4 million , or$0.66 per share, in the first quarter of 2008. The Company's first quarter income from continuing operations included several items which the Company deems to be unusual or one-time in nature, including:- In the first quarter of 2009, restructuring costs of
$2.6 million , pre-tax, associated with the implementation of the cost-control initiatives announced in February; the write-off of deferred financing fees of$0.9 million , pre-tax, related to the prepayment of a portion of the term loan; an asset impairment charge of$0.8 million , pre-tax, for an underperforming store that has been open for less than two years; and a one-time tax benefit of$4.5 million from the settlement of an IRS income tax audit. - In the first quarter of 2008, restructuring costs of
$1.3 million , pre-tax, and professional fees of$0.8 million , pre-tax, related to the Company's review of strategic alternatives.
- In the first quarter of 2009, restructuring costs of
- Excluding the unusual or one-time items mentioned above from the
first quarters of both years, adjusted income from continuing
operations after tax was
$21.8 million , or$0.74 per diluted share, in the first quarter of 2009, compared to$20.7 million , or$0.71 per diluted share, in the first quarter of 2008. The first quarter income from continuing operations excluding these items is a non-GAAP measure. The Company believes the excluded items are not indicative of the performance of its core business and that by providing this supplemental disclosure to investors it will facilitate comparisons of its past and present performance. A reconciliation of income from continuing operations as reported is included in this press release in Table 3. - Net income, including the impact of discontinued operations, was
$23.5 million in the first quarter of 2009, or$0.79 per diluted share, compared to net income of$19.5 million , or$0.67 per diluted share, for the same period last year. - During the first quarter of 2009, the Company opened six stores and closed one.
"We are pleased that the actions taken during the past year to strengthen our business and put the Company on more stable footing enabled us to deliver a solid performance in the first quarter, particularly in light of the market volatility and negative industry trends," commented Chuck Crovitz, interim Chief Executive Officer of The
Conference Call Information
The Children's Place will host a conference call to discuss its first quarter results today at
About The
The
This press release may contain certain forward-looking statements regarding future circumstances, including statements relating to the Company's longer-term goals. These forward-looking statements are based upon the Company's current expectations and assumptions and are subject to various risks and uncertainties that could cause actual results to differ materially. Some of these risks and uncertainties are described in the Company's filings with the
Table 1
THE CHILDREN'S PLACE RETAIL STORES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
First Quarter Ended
-------------------
May 2, May 3,
2009 2008
-------- --------
Net sales $401,901 $400,212
Cost of sales 235,374 229,120
-------- --------
Gross profit 166,527 171,092
Selling, general and administrative expenses 111,893 119,410
Asset impairment charge 1,099 --
Depreciation and amortization 17,524 17,652
-------- --------
Income from continuing operations before interest
and taxes 36,011 34,030
Interest (expense), net (3,268) (493)
-------- --------
Income from continuing operations before income
taxes 32,743 33,537
Provision for income taxes 9,002 14,117
-------- --------
Income from continuing operations net of income
taxes 23,741 19,420
Income (Loss) from discontinued operations net of
income taxes (229) 98
-------- --------
Net income $ 23,512 $ 19,518
======== ========
Basic income from continuing operations per common
share $ 0.81 $ 0.67
Income (Loss) from discontinued operations per
common share (0.01) 0.00
-------- --------
Basic net income per common share $ 0.80 $ 0.67
======== ========
Basic weighted average common shares outstanding 29,475 29,182
Diluted income from continuing operations per
common share $ 0.80 $ 0.66
Income from discontinued operations per common
share (0.01) 0.00
-------- --------
Diluted net income per common share $ 0.79 $ 0.67
======== ========
Diluted weighted average common shares and common
shares equivalents outstanding 29,605 29,275
Note: Amounts may not add due to rounding
Table 2
THE CHILDREN'S PLACE RETAIL STORES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
May 2, Jan. 31, May 3,
2009 2009 2008
-------- -------- --------
Current assets:
Cash and investments $224,275 $226,206 $118,315
Accounts receivable 19,299 19,639 34,661
Inventories 181,984 211,227 179,065
Other current assets 84,880 62,518 92,406
Restricted assets in bankruptcy estate
of subsidiary -- -- 99,068
-------- -------- --------
Total current assets 510,438 519,590 523,515
Property and equipment, net 314,331 318,116 338,450
Other assets, net 67,151 102,051 91,911
-------- -------- --------
Total assets $891,920 $939,757 $953,876
======== ======== ========
Current liabilities:
Revolving credit facility $ -- $ -- $ 27,936
Short term portion of term loan 15,000 30,000 --
Accounts payable 58,155 73,333 59,303
Accrued expenses and other current
liabilities 98,811 103,662 109,273
Liabilities subject to compromise -- -- 123,694
-------- -------- --------
Total current liabilities 171,966 206,995 320,206
Long term portion of term loan 23,000 55,000 --
Other liabilities 117,565 129,883 141,504
-------- -------- --------
Total liabilities 312,531 391,878 461,710
Stockholders' equity 579,389 547,879 492,166
-------- -------- --------
Total liabilities and stockholders'
equity $891,920 $939,757 $953,876
======== ======== ========
Table 3
THE CHILDREN'S PLACE RETAIL STORES, INC.
RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION TO GAAP
(In millions, except per share amounts)
(Unaudited)
First Quarter Ended
-------------------
May 2, May 3,
2009 2008
-------- --------
Income from continuing operations net of income
taxes $ 23.7 $ 19.4
-------- --------
Significant one-time items pre-tax:
Restructuring costs 2.6 1.3
Deferred financing fees write-off 0.9 --
Impairment charge 0.8 --
Professional fees -- 0.8
-------- --------
Aggregate expense from significant one-time items 4.3 2.1
Less income tax effect for significant one-time
items (1.7) (0.8)
One-time tax benefit resulting from resolution of
an IRS income tax audit (4.5) --
-------- --------
Adjusted (gain) expense from significant one-time
items after taxes (1.9) 1.3
-------- --------
Adjusted income from continuing operations net of
income taxes $ 21.8 $ 20.7
======== ========
GAAP income from continuing operations per diluted
share $ 0.80 $ 0.66
Adjusted income from continuing operations per
diluted share $ 0.74 $ 0.71
CONTACT: The
(201) 558-2400
(201) 453-6955