COLUMBUS, Ohio, Sept. 10 /PRNewswire-FirstCall/ -- Retail Ventures, Inc. today announced its consolidated financial results for the second quarter ended August 1, 2009.
On April 21, 2009, Retail Ventures sold all of the outstanding capital stock of Filene''s Basement to FB II Acquisition Corp., a newly formed entity owned by Buxbaum Holdings, Inc. On May 4, 2009, Filene''s Basement filed for bankruptcy protection.
-- The loss from continuing operations for the quarter ended August 1, 2009 was $4.4 million on net sales of $369.5 million, compared to income from continuing operations of $25.8 million on net sales of $357.2 million for the quarter ended August 2, 2008. DSW same store sales decreased 2.9% during the second quarter of fiscal 2009 versus a decrease of 6.9% last year. -- Diluted loss per share from continuing operations attributable to Retail Ventures, Inc. common shareholders was $0.15 for the quarter ended August 1, 2009 compared with diluted earnings per share from continuing operations attributable to Retail Ventures, Inc. common shareholders of $0.45 per share last year.
The Company believes that the non-cash accounting charge associated with the change in fair value of derivative instruments is not directly related to its retail operations and is therefore providing supplemental adjusted results that exclude this item. This non-GAAP financial measure should facilitate analysis by investors and others who follow the Company''s financial performance. A reconciliation of non-GAAP results follows:
Fiscal Quarter Ended August 1, August 2, 2009 2008 (dollars in thousands) Operating (loss) profit: Non-GAAP operating profit $ 7,988 $ 17,679 Change in fair value of derivatives (8,689) 16,733 GAAP operating (loss) profit $ (701) $ 34,412 (Loss) income from continuing operations attributable to Retail Ventures, Inc. common shareholders: Non-GAAP income from continuing operations $ 1,510 $ 5,135 Change in fair value of derivatives (8,689) 16,733 GAAP (loss) income from continuing operations, net of tax $ (7,179) $ 21,868 Diluted (loss) income per share from continuing operations attributable to Retail Ventures, Inc. common shareholders: Non-GAAP diluted income per share $ 0.03 $ 0.11 Change in fair value of derivatives (0.18) 0.34 GAAP diluted (loss) income per share from continuing operations $ (0.15) $ 0.45
Retail Ventures, Inc. is a leading off-price retailer operating, as of August 1, 2009, 306 DSW shoe stores in 39 states. DSW also supplies shoes, under supply arrangements, to 358 locations for other retailers in the United States and operates dsw.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Any statements in this release that are not historical or current facts are forward-looking statements. All forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties and other factors that could cause our future financial performance in fiscal 2009 and beyond to differ materially from those expressed or implied in any such forward-looking statements. Certain of these risks and uncertainties are described in the "Risk Factors" section of the Company''s latest quarterly or annual report, as filed with the SEC. These factors include, but are not limited to: our ability to manage and enhance liquidity; DSW''s success in opening and operating new stores on a timely and profitable basis; continuation of DSW''s supply agreements and the financial condition of its leased business partners; maintaining good relationships with our vendors; our ability to anticipate and respond to fashion trends; fluctuation of our comparable store sales and quarterly financial performance; the realization of our bankruptcy claims related to Filene''s Basement and Value City Department Stores; the impact of the disposition of Filene''s Basement and of a majority interest in Value City and the reliance on remaining subsidiaries to pay indebtedness and intercompany service obligations; the risk of Value City and Filene''s Basement not paying us or their creditors, for which Retail Ventures may have some liability; the impact of Value City and Filene''s Basement on our liquidity; disruption of our distribution operations; our dependence on DSW for key services; failure to retain our key executives or attract qualified new personnel; our competitiveness with respect to style, price, brand availability and customer service; declining general economic conditions; risks inherent to international trade with countries that are major manufacturers of footwear; the success of dsw.com; lease of an office facility; liquidity and investment risks related to our investments; and DSW''s ability to secure additional credit upon the termination of its existing credit facility. Additional factors that could cause our actual results to differ materially from our expectations are described in the Company''s latest annual or quarterly report, as filed with the SEC. Any forward-looking statement speaks only as of the date on which such statement is made. The Company undertakes no obligation to revise the forward-looking statements included in this press release to reflect any future events or circumstances.
RETAIL VENTURES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (unaudited) August 1, January 31, 2009 2009 ASSETS Cash and equivalents $ 58,972 $ 94,308 Restricted cash 261 Short-term investments, net 139,687 101,404 Accounts receivable, net 6,534 7,474 Inventories 264,295 244,008 Prepaid expenses and other current assets 23,418 27,249 Deferred income taxes 26,598 22,243 Current assets held for sale 66,678 Total current assets 519,504 563,625 Property and equipment, net 223,187 236,355 Goodwill 25,899 25,899 Tradenames and other intangibles, net 3,241 3,668 Conversion feature of long-term debt 68,568 77,761 Deferred income taxes 805 Other assets 5,017 6,856 Non-current assets held for sale 38,793 Total assets $ 845,416 $ 953,762 LIABILITIES AND SHAREHOLDERS'' EQUITY Accounts payable $ 104,429 $ 96,213 Accrued expenses 78,340 77,064 Warrant liability 7,184 6,292 Current maturities of long-term obligations 250 Current liabilities held for sale 76,030 Total current liabilities 189,953 255,849 Long-term obligations, net of current maturities 128,643 127,576 Other noncurrent liabilities 117,994 109,290 Deferred income taxes 24,524 29,806 Noncurrent liabilities held for sale 36,055 Total Retail Ventures'' shareholder''s equity 204,392 222,614 Noncontrolling interests 179,910 172,572 Total shareholders'' equity 384,302 395,186 Total liabilities and shareholders'' equity $ 845,416 $ 953,762 RETAIL VENTURES, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in thousands, except per share amounts) (unaudited) Three months Six months ended ended August 1, August 2, August 1, August 2, 2009 2008 2009 2008 ---- ---- ---- ---- Net sales $369,490 $357,175 $755,336 $723,439 Cost of sales (210,267) (198,515) (427,867) (409,613) --------- --------- --------- --------- Gross profit 159,223 158,660 327,469 313,826 Selling, general and administrative expenses (151,235) (140,981) (366,169) (280,141) Change in fair value of derivative instruments (8,689) 16,733 (10,077) 53,901 ------- ------ -------- ------ Operating (loss) profit (701) 34,412 (48,777) 87,586 Interest expense, net (2,433) (974) (5,177) (1,617) Non-operating income, net 528 133 --- --- (Loss) income from continuing operations before income taxes (2,606) 33,438 (53,821) 85,969 Income tax expense (1,763) (7,616) (2,429) (14,238) ------- ------- ------- -------- (Loss) income from continuing operations (4,369) 25,822 (56,250) 71,731 Income (loss) from discontinued operations, net of tax 23,332 (4,134) 33,990 (17,086) ------ ------- ------ -------- Net income (loss) 18,963 21,688 (22,260) 54,645 Less: net income attributable to the noncontrolling interests (2,810) (3,954) (5,459) (7,760) ------- ------- ------- ------- Net income (loss) attributable to Retail Ventures, Inc. $16,153 $17,734 $(27,719) $46,885 ------- ------- -------- ------- Basic and diluted earnings (loss) per share: Basic (loss) earnings per share from continuing operations attributable to Retail Ventures, Inc. common shareholders $(0.15) $0.45 $(1.26) $1.31 Diluted (loss) earnings per share from continuing operations attributable to Retail Ventures, Inc. common shareholders $(0.15) $0.45 $(1.26) $1.27 Basic earnings (loss) per share from discontinued operations attributable to Retail Ventures, Inc. common shareholders $0.48 $(0.08) $0.70 $(0.35) Diluted earnings (loss) per share from discontinued operations attributable to Retail Ventures, Inc. common shareholders $0.48 $(0.08) $0.70 $(0.34) Basic earnings (loss) per share attributable to Retail Ventures, Inc. common shareholders $0.33 $0.36 $(0.57) $0.96 Diluted earnings (loss) per share attributable to Retail Ventures, Inc. common shareholders $0.33 $0.36 $(0.57) $0.93 Shares used in per share calculations: Basic 48,934 48,675 48,813 48,657 Diluted 48,934 48,970 48,813 50,296 Amounts attributable to Retail Ventures, Inc. common shareholders: (Loss) income from continuing operations, net of tax $(7,179) $21,868 $(61,709) $63,971 Discontinued operations, net of tax 23,332 (4,134) 33,990 (17,086) ------ ------- ------ -------- Net income (loss) $16,153 $17,734 $(27,719) $46,885 ------- ------- --------- -------
Retail Ventures, Inc.
CONTACT: Jim McGrady, Chief Financial Officer, +1-614-238-4105
Web Site: http://www.retailventuresinc.com/