The Children's Place Reports 2002 Second Quarter Financial Results
SECAUCUS, N.J., Aug 15, 2002 (BUSINESS WIRE) -- The Children's Place Retail Stores, Inc. (Nasdaq: PLCE) today reported financial results for the second quarter and six months ended August 3, 2002.
Second Quarter
- Net sales for the second quarter increased 10% to $128.3
million, compared with $116.3 million for the same period in
2001.
- Comparable store sales decreased 9% in the quarter, versus a
16% decrease for the same period last year.
- Net loss was $10.2 million, compared to a net loss of $3.9
million last year.
- Loss per share was $0.38 compared to a loss of $0.15 per share
in the 2001 period.
- The Company opened 46 new stores during the second quarter,
including 13 in Canada.
Six-Month Period
- Net sales for the six-month period increased 9% to $301.3
million, from $276.8 million for the same period in 2001.
- Comparable store sales decreased 10% for the period, compared
to an 8% decrease for the same period last year.
- Net income was $5.0 million, compared to $8.9 million in the
year-ago period.
- Diluted earnings per share were $0.19 compared to earnings per
share of $0.33 in the 2001 period.
- The Company opened 80 new stores during the six-month period,
including 13 in Canada.
"As previously announced, lower than expected sales in the month of July resulted in excessive levels of summer merchandise which impacted our performance during the second quarter. As a result, we took aggressive markdowns to clear the inventory and avoid distracting from our Back-to-School floor set," said Ezra Dabah, Chairman and Chief Executive Officer. "Our merchandise initiatives are beginning to be reflected in our Back-to-School collection, and we are encouraged by the early customer response to our reduced prices, especially our '2-for' key items."
At the end of the second quarter the Company opened 13 stores in Quebec and Ontario. Commenting on the expansion, Mr. Dabah said, "We are proud to have entered Canada and are excited by the very enthusiastic response from our new Canadian customers."
The Children's Place will host a webcast of its second quarter conference call today at 10:00 a.m., Eastern Time. Investors and the media are invited to listen to the call at the Company's web site, www.childrensplace.com. An archive of the webcast will be available on the site through Thursday, August 22, 2002.
The Children's Place Retail Stores, Inc. is a leading specialty retailer of high quality, value-priced apparel and accessories for children, newborn to age twelve. The Company designs, contracts to manufacture and sells its products under the "The Children's Place" brand name. As of August 3, 2002, the Company operated 600 stores, including 587 stores in the United States and 13 stores in Canada. The Company also sells its merchandise through its virtual store located at www.childrensplace.com.
This press release and above referenced call may contain certain forward-looking statements regarding future circumstances. 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 from those contemplated in such forward-looking statements including, in particular, the risks and uncertainties described in the Company's filings with the Securities and Exchange Commission. Actual results, events, and performance may differ. Readers or listeners (on the call) are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. We undertake no obligation to release publicly any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. The inclusion of any statement in this release does not constitute an admission by The Children's Place or any other person that the events or circumstances described in such statement are material.
THE CHILDREN'S PLACE RETAIL STORES, INC.
CONDENSED STATEMENTS OF INCOME
(In thousands, except per share amounts)
(Unaudited)
13 Weeks Ended: 26 Weeks Ended:
-------------- --------------
August 3, August 4, August 3, August 4,
--------- -------- --------- ---------
2002 2001 2002 2001
---- ---- ---- ----
Net sales $ 128,295 $ 116,318 $ 301,342 $ 276,779
Cost of sales 91,909 75,499 185,828 167,798
---------- -------- --------- ----------
Gross profit 36,386 40,819 115,514 108,981
Selling, general and
administrative
expenses 44,597 40,613 90,970 81,865
Depreciation and
amortization 8,441 6,473 16,711 12,342
------------ --------- --------- ---------
Operating income
(loss) (16,652) (6,267) 7,833 14,774
Interest (income)
expense, net (118) 112 (364) 142
------------ --------- ---------- ---------
Income (loss) before
income taxes (16,534) (6,379) 8,197 14,632
Provision (benefit)
for income taxes (6,367) (2,487) 3,156 5,706
------------ --------- ---------- ---------
Net income (loss) $ (10,167) $ (3,892) $ 5,041 $ 8,926
============ ========= ========== =========
Basic income (loss)
per share $ (0.38) $ (0.15) $ 0.19 $ 0.34
Basic weighted
average number
of shares
outstanding 26,492 26,245 26,460 26,203
Diluted income
(loss) per share(1) $ (0.38) $ (0.15) $ 0.19 $ 0.33
Diluted weighted
average number
of shares outstanding 26,492 26,245 27,219 26,922
(1) The net loss per share presented in the Condensed Statements
of Income for the thirteen weeks ended August 3, 2002, and
August 4, 2001, excludes the dilutive effect of stock options,
which would be antidilutive as a result of the net loss.
THE CHILDREN'S PLACE RETAIL STORES, INC.
CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)
August 3, 2002 August 4, 2001
-------------- --------------
Current assets:
Cash and cash equivalents $ 31,705 $ 9,922
Accounts receivable 17,506 16,790
Inventories 62,261 68,600
Other current assets 23,537 23,321
---------------- --------------
Total current assets 135,009 118,633
Property and equipment, net 159,645 140,409
Other assets, net 6,148 5,151
---------------- --------------
Total assets $ 300,802 $ 264,193
================ ==============
Current liabilities:
Revolving credit facility -- 25,177
Accounts payable 29,169 24,639
Accrued expenses and
other current liabilities 35,969 29,364
---------------- ---------------
Total current liabilities 65,138 79,180
Other liabilities 12,169 7,929
---------------- ---------------
Total liabilities 77,307 87,109
Stockholders' equity 223,495 177,084
---------------- ---------------
Total liabilities and
stockholders' equity $ 300,802 $ 264,193
================ ===============
CONTACT: The Children's Place Seth Udasin, 201/558-2409 Heather Anthony, 201/558-2865