Brookstone Announces $2.1 million EBITDA Improvement For First Quarter 2012 Financial Results

MERRIMACK, N.H., May 10, 2012 /PRNewswire/ -- Innovative product development company and multi-channel lifestyle retailer Brookstone, Inc. announced today that, for the first quarter ended March 31, 2012, consolidated net sales increased 11.2% to $89.1 million and EBITDA improved 18.1% to $(9.7) million from the first quarter of 2011. 

Net sales in the Retail channel increased $3.7 million, or 5.9%, to $67.5 million and same-store sales increased 7.9% as compared to the first quarter of 2011. These increases were due in part to improved selling efforts at our retail stores, offset by a net decrease in the number of stores from 300 to 284. For the same period, net sales in our e-Commerce channel increased $3.2 million, or 26.1%, to $15.5 million, primarily due to revenue growth in our on-line marketplace initiative under which we have significantly increased the selection of quality third party marketplace products on our website, www.brookstone.com. Net sales in the Alternative Distribution channel, which includes our wholesale business, increased $2.0 million, or 48.7%, to $6.0 million, as we continue to focus on expanding our revenue streams through alternative channels.  

Jim Speltz, Brookstone's Chief Operating Officer, said:  "We are encouraged with both the top and bottom line results for the first quarter of 2012 as we were able to realize improvements in our business, including an expansion of our product assortment in our e-Commerce segment, improved interactive selling efforts in our retail stores, and increased sales to our wholesale and corporate partners. We are especially pleased with the performance of our proprietary Bluetooth enabled assortment featuring Big Blue Audio speakers and premium tablet keyboards.  Our Wellness business including Sleep and Massage also performed well and provides us with optimism for 2012 as we continue to grow each of our primary channels of business."

Non-GAAP Financial Information
EBITDA is a measure used by management to evaluate the Company's ongoing operations and as a general indicator of the Company's operating cash flow. The Company defines EBITDA as net income, plus interest expense, provision for income taxes, and depreciation and amortization. Management believes EBITDA is useful to investors because it is frequently used by securities analysts, investors and other interested parties in the comparative evaluation of companies. Because not all companies use identical calculations, the Company's presentation of EBITDA may not be comparable to similarly titled measures of other companies. EBITDA is not a recognized term under GAAP and does not purport to be an alternative to either net income as a measure of operating performance or to cash flows from operating activities as a measure of liquidity. Additionally, EBITDA is not intended to be a measure of free cash flow for management's discretionary use as it does not reflect certain cash requirements such as interest payments, tax payments and debt service requirements. We have provided a reconciliation of EBITDA to GAAP net income below:

Brookstone, Inc. is an innovative product development and specialty lifestyle retail company that currently operates 284 Brookstone branded stores nationwide and in Puerto Rico. Typically located in high-traffic regional shopping malls and airports, the stores feature unique and innovative consumer products. The Company also operates an e-Commerce channel that includes the Brookstone catalog and the Brookstone website at http://www.brookstone.com as well as an alternative distribution channel that includes sales to select resellers and corporate partners. 

Brookstone is principally owned by three sponsors, Osim International, J.W. Childs, and Temasek Holdings.  In accordance with the terms governing its publicly-held debt, the Company issues quarterly and annual reports under SEC guidelines.

Statements in this release which are not historical facts, including statements about the Company's confidence or expectations, earnings, anticipated operations of its e-commerce sites and those of third-party service providers, and other statements about the Company's operational outlook are forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 ("Reform Act") and are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in such forward-looking statements. Such risks and uncertainties include, without limitation, risks of changing market conditions in the overall economy and the retail industry, consumer demand, the effectiveness of e-commerce technology and marketing efforts, availability of products, availability of adequate transportation of such products, and other factors detailed from time to time in the Company's annual and other reports posted to the Company's website. Words such as "estimate", "project", "plan", "believe", "feel", "anticipate", "assume", "may", "will", "should" and similar words and phrases may identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date thereof. The Company undertakes no obligations to publicly release any revisions to these forward-looking statements or reflect events or circumstances after the date hereof.

Contact:

Thomas F. Moynihan
Vice President, Chief Financial Officer
(603) 880-9500

SOURCE Brookstone, Inc.

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