SAN FRANCISCO, Nov. 18 /PRNewswire-FirstCall/ -- The Gymboree Corporation today reported earnings of $34.8 million or $1.15 per diluted share for the third fiscal quarter ended October 31, 2009. This compares to earnings of $30.9 million or $1.06 per diluted share for the same period of the prior year.
Net sales from retail operations for the fiscal quarter ended October 31, 2009, totaled $265.6 million, a 2% increase from $261.3 million in net sales from retail operations for the third fiscal quarter of the prior year. As previously reported, comparable store sales from retail operations for the third fiscal quarter decreased 4% versus the same period last year. Total net sales for the third fiscal quarter were $269.1 million, an increase of 2% compared to total net sales of $264.1 million for the third fiscal quarter last year.
"We are pleased to report stronger operating margins and earnings over the prior year, despite the current difficult retail environment," said Matthew McCauley, Chairman and Chief Executive Officer. "We continue to expect the consumer to be value-driven and we remain focused on margin optimization and tight expense management throughout the fourth quarter and beyond."
Business Outlook
For the fourth fiscal quarter of 2009, the Company expects a low to mid single digit decrease in comparable store sales versus the same period of the prior year. The Company expects earnings for the fourth fiscal quarter in the range of $0.95 to $1.03 per diluted share.
Share Repurchase Authorization
The Gymboree Corporation announced that its Board of Directors has authorized the Company to utilize up to $40 million of its cash reserves to purchase shares of the Company''s outstanding common stock under a share repurchase program. Purchases under the share repurchase program may be made from time to time on the open market or in privately negotiated transactions. Depending on market conditions and other factors, purchases under this program may be commenced or suspended without prior notice at any time, or from time to time, through October 30, 2010. At current price levels, approximately 3% of the Company''s outstanding shares could be repurchased under this program.
Management Presentation
The live broadcast of the discussion of third quarter 2009 earnings results will be available to interested parties at 1:30 p.m. PT (4:30 p.m. ET) on Wednesday, November 18, 2009. To listen to the live broadcast over the Internet, please log on to http://www.gymboree.com/, click on "Our Company" at the bottom of the page, go to "Investor and Media Relations" and then "Conference Calls, Webcasts & Presentations." A replay of the call will be available two hours after the broadcast through midnight ET, Wednesday, November 25, 2009, at 800-642-1687, passcode 85035174, as well as archived on our Web site at the same location as the live Web cast.
About The Gymboree Corporation
The Gymboree Corporation''s specialty retail brands offer unique, high-quality products delivered with personalized customer service. As of October 31, 2009, the Company operated a total of 951 retail stores: 630 Gymboree® stores (594 in the United States, 34 in Canada and 2 in Puerto Rico), 139 Gymboree Outlet stores, 120 Janie and Jack® shops and 62 Crazy 8® stores in the United States. The Company also operates online stores at http://www.gymboree.com/, http://www.janieandjack.com/ and http://www.crazy8.com/, and offers directed parent-child developmental play programs at 628 franchised and Company-operated Gymboree Play & Music® centers in the United States and 28 other countries.
Forward-Looking Statements
The foregoing financial information for the third fiscal quarter ended October 31, 2009, is unaudited and subject to quarter-end and year-end adjustment. The foregoing paragraphs contain forward-looking statements relating to The Gymboree Corporation''s anticipated sales growth and future financial performance. These are forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results could vary materially as a result of a number of factors, including increasing levels of unemployment and consumer debt, volatility in the financial markets, current recessionary economic conditions, customer reactions to new merchandise, service levels and new concepts, success in meeting our delivery targets, the level of our promotional activity, our gross margin achievement, our ability to appropriately manage inventory, effects of future embargos from countries used to source product, and competitive market conditions. Other factors that may cause actual results to differ materially include those set forth in the reports that we file from time to time with the Securities and Exchange Commission, including our annual report on Form 10-K for the year-ended January 31, 2009. These forward-looking statements reflect The Gymboree Corporation''s expectations as of November 18, 2009. The Gymboree Corporation undertakes no obligation to update the information provided herein.
Gymboree, Janie and Jack, Crazy 8 and Gymboree Play & Music are registered trademarks of The Gymboree Corporation.
EXHIBIT A THE GYMBOREE CORPORATION ------------------------ CONDENSED CONSOLIDATED STATEMENTS OF INCOME ------------------------------------------- (In thousands, except per share and operating data) (Unaudited) 13 Weeks 13 Weeks 39 Weeks 39 Weeks Ended Ended Ended Ended October 31, November 1, October 31, November 1, 2009 2008 2009 2008 ---- ---- ---- ---- Net sales: Retail $265,596 $261,296 $705,836 $703,031 Play & Music 3,485 2,809 9,513 8,926 ----- ----- ----- ----- Total net sales 269,081 264,105 715,349 711,957 Cost of goods sold, including buying and occupancy expenses (131,973) (129,520) (375,484) (360,012) -------- -------- -------- -------- Gross profit 137,108 134,585 339,865 351,945 Selling, general and administrative expenses (80,689) (84,377) (229,843) (247,269) ------- ------- -------- -------- Operating income 56,419 50,208 110,022 104,676 Other income, net 159 152 668 849 --- --- --- --- Income before income taxes 56,578 50,360 110,690 105,525 Income tax expense (21,823) (19,413) (41,966) (41,529) ------- ------- ------- ------- Net income $34,755 $30,947 $68,724 $63,996 ======= ======= ======= ======= Net income per share: Basic $1.20 $1.10 $2.40 $2.30 Diluted $1.15 $1.06 $2.31 $2.20 Weighted average shares outstanding: Basic 28,952 28,051 28,684 27,861 Diluted 30,093 29,099 29,801 29,073 Operating Data: Stores Open at the Beginning of the Period 926 835 886 786 New Stores 25 39 65 90 Closed Stores - (1) - (3) --- -- --- -- Stores Open at the End of the Period 951 873 951 873 === === === === Gross Store Square Footage 1,866,000 1,706,000 1,866,000 1,706,000 Merchandise Inventories per Square Foot $77 $83 $77 $83 Supplemental Financial Information Depreciation and amortization $9,285 $8,761 $27,463 $25,782 Interest income, net $43 $362 $464 $948 Stock-based compensation $4,442 $4,939 $12,793 $14,363 CONDENSED CONSOLIDATED BALANCE SHEETS ------------------------------------- (In thousands) (Unaudited) October 31, January 31, November 1, 2009 2009 2008 ---- ---- ---- Current Assets Cash and cash equivalents $212,107 $140,472 $93,153 Accounts receivable 14,500 18,735 15,793 Merchandise inventories 144,559 114,972 142,042 Prepaid income taxes - - 804 Prepaid expenses and deferred taxes 17,431 19,704 24,126 ------ ------ ------ Total current assets 388,597 293,883 275,918 ------- ------- ------- Property and Equipment, net 208,627 204,227 206,630 Deferred Taxes and Other Assets 20,130 22,471 18,078 ------ ------ ------ Total Assets $617,354 $520,581 $500,626 ======== ======== ======== Current Liabilities Accounts payable $47,409 $44,400 $59,941 Income tax payable 3,559 102 - Accrued liabilities 64,975 69,341 70,266 ------ ------ ------ Total current liabilities 115,943 113,843 130,207 ------- ------- ------- Long-Term Liabilities Lease incentives and other liabilities 75,423 72,463 70,272 Stockholders'' Equity 425,988 334,275 300,147 ------- ------- ------- Total Liabilities and Stockholders'' Equity $617,354 $520,581 $500,626 ======== ======== ========
The Gymboree Corporation
CONTACT: Investor Relations, Jeffrey P. Harris, +1-415-278-7933,
investor_relations@gymboree.com, or Media Relations, Mark Mizicko,
+1-415-278-7503, media_relations@gymboree.com, both of Gymboree
Web Site: http://www.gymboree.com/
http://www.janieandjack.com/
http://www.crazy8.com/