The Children's Place Reports 2003 Second Quarter Financial Results; Net Sales Increase 24%; Comparable Store Sales Increase 3%
SECAUCUS, N.J., Aug 14, 2003 (BUSINESS WIRE) -- The Children's Place Retail Stores, Inc. (Nasdaq:PLCE) today reported financial results for the second quarter and six months ended August 2, 2003.
Second Quarter -- Net sales for the second quarter increased 24% to $159.1 million, compared with $128.3 million for the same period in 2002. -- Comparable store sales increased 3% in the quarter, versus a 9% decrease for the same period last year. -- Net loss was $9.4 million, compared to a net loss of $10.2 million last year. -- Loss per share was $0.35 compared to a loss of $0.38 per share in the 2002 period. -- The Company opened 19 new stores during the second quarter, and closed two. Six-Month Period -- Net sales for the six-month period increased 13% to $340.1 million, from $301.3 million for the same period in 2002. -- Comparable store sales decreased 6% for the period, compared to a 10% decrease for the same period last year. -- Net loss was $3.8 million, compared to a $5.0 million net profit in the year-ago period. -- Loss per share was $0.14 compared to earnings per share of $0.19 in the 2002 period. -- The Company opened 38 new stores during the six-month period, and closed two.
"We are pleased with our sales performance in the second quarter, which reflects the continued execution of our strategic initiatives," said Ezra Dabah, Chairman and Chief Executive Officer of The Children's Place. "Our positive comparable store sales results were driven by increases in units per transaction, the number of transactions and average transaction size, as well as more full price selling. In addition, we are encouraged by the improvement in our gross margin for the second quarter, which we achieved while offering our customers higher quality merchandise at lower prices. The strong customer acceptance of our merchandise has resulted in a clean inventory position heading into the third quarter, with approximately 30% less old season merchandise on a per store basis versus a year ago."
Dabah concluded, "We are pleased with our Fall merchandise assortment, which is well balanced between fashion and basics and satisfies the lifestyle needs of our customers. We believe this, combined with our compelling in-store marketing, customer service initiatives and the right level of inventory, position us well for the Back-to-School season. While we are encouraged by the strides we have made in our business, our outlook remains cautious given the challenging retail environment."
The Children's Place will host a webcast of its second quarter conference call today at 10:00 a.m., Eastern Time. Interested parties 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 21, 2003.
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 10. The Company designs, contracts to manufacture and sells its products under the "The Children's Place" brand name. As of August 2, 2003, the Company operated 679 stores, including 642 stores in the United States and 37 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 2, August 3, August 2, August 3, 2003 2002 2003 2002 ---- ---- ---- ---- Net sales $ 159,082 $ 128,295 $ 340,092 $ 301,342 Cost of sales 108,612 91,909 219,732 185,828 ---------- ---------- ---------- ---------- Gross profit 50,470 36,386 120,360 115,514 Selling, general and administrative expenses 55,988 44,597 107,379 90,970 Depreciation and amortization 9,875 8,441 19,403 16,711 ---------- ---------- ---------- ---------- Operating (loss) income (15,393) (16,652) (6,422) 7,833 Interest income, net 52 118 145 364 ---------- ---------- ---------- ---------- (Loss) income before income taxes (15,341) (16,534) (6,277) 8,197 (Benefit) provision for income taxes (5,982) (6,367) (2,447) 3,156 ---------- ---------- ---------- ---------- Net (loss) income $ (9,359) $ (10,167) $ (3,830) $ 5,041 ========== ========== ========== ========== Basic (loss) income per share $ (0.35) $ (0.38) $ (0.14) $ 0.19 Basic weighted average number of shares outstanding 26,620 26,492 26,609 26,460 Diluted (loss) income per share $ (0.35) $ (0.38) $ (0.14) $ 0.19 Diluted weighted average number of shares outstanding 26,620 26,492 26,609 27,219
THE CHILDREN'S PLACE RETAIL STORES, INC. CONDENSED BALANCE SHEETS (In thousands) Aug. 2, 2003 Feb. 1, 2003 Aug. 3, 2002 ------------ ------------ ------------ (Unaudited) (Unaudited) Current assets: Cash and cash equivalents $ 25,194 $ 36,645 $ 31,705 Accounts receivable 15,412 13,571 17,506 Inventories 87,321 75,417 62,261 Other current assets 26,042 19,570 23,537 ------------ ------------ ------------ Total current assets 153,969 145,203 135,009 Property and equipment, net 154,617 155,000 159,645 Other assets, net 9,326 9,125 6,148 ------------ ------------ ------------ Total assets $ 317,912 $ 309,328 $ 300,802 ============ ============ ============ Current liabilities: Revolving credit facility $ 426 $ 0 $ 0 Accounts payable 35,488 30,805 29,169 Accrued expenses and other current liabilities 40,818 35,124 35,969 ------------ ------------ ------------ Total current liabilities 76,732 65,929 65,138 Other liabilities 15,189 14,391 12,169 ------------ ------------ ------------ Total liabilities 91,921 80,320 77,307 Stockholders' equity 225,991 229,008 223,495 ------------ ------------ ------------ Total liabilities and stockholders' equity $ 317,912 $ 309,328 $ 300,802 ============ ============ ============
SOURCE: The Children's Place
The Children's Place, Secaucus Seth Udasin, 201-558-2409 or Heather Anthony, 201-558-2865
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