The Gymboree Corporation Reports Preliminary Fourth Quarter and Full Year 2009 Results
SAN FRANCISCO, March 10 /PRNewswire-FirstCall/ -- The Gymboree Corporation (Nasdaq: GYMB) today reported consolidated financial results for the fourth fiscal quarter and full year ended January 30, 2010.
Fourth Fiscal Quarter Ended January 30, 2010
For the fourth fiscal quarter, net sales were $299.6 million, an increase of 4% compared to $288.7 million in net sales for the fourth fiscal quarter of the prior year. As previously reported, comparable store sales for the quarter decreased 2% versus the fourth quarter of the prior year.
Gross profit for the fourth fiscal quarter of 2009 was $140.0 million or 46.7% of net sales compared to $124.3 million or 43.0% of net sales for the fourth fiscal quarter of 2008. Excluding the impact of the prior year $6.0 million write-off of merchandise inventories, gross profit increased 180 basis points.
SG&A expense for the fourth quarter was $86.4 million or 28.9% of net sales, compared to $80.6 million or 27.9% of net sales in the comparable quarter of the prior year.
Net income for the fourth quarter of fiscal 2009 was $33.2 million or $1.11 per diluted share, compared to net income of $29.5 million or $1.00 per diluted share for the same period last year. The tax rate for the quarter was 38.6% versus 33.2% in the prior year. The lower than normal tax rate last year was primarily due to tax planning efforts that resulted in higher foreign tax credits arising from foreign tax expense.
Fiscal Year 2009 ended January 30, 2010
Net sales for the 52-week period ended January 30, 2010, were slightly more than $1.0 billion, a 1% increase from the prior fiscal year. Comparable store sales for fiscal 2009 were down 4% compared to the prior year.
Operating income for the full fiscal year was up 10% to $163.6 million compared to $148.3 million in the prior fiscal year. Operating margins increased 130 basis points to 16.1%.
For the full fiscal year ended January 31, 2010, net income was $101.9 million or $3.41 per diluted share, compared to net income of $93.5 million or $3.21 per diluted share in the prior year.
First Quarter Fiscal 2010 Business Outlook
Sales Expectations
For the first quarter of fiscal year 2010, the Company is planning for comparable store sales growth in the range of mid single digits.
Net Income
The Company expects net income for the first fiscal quarter of 2010 to be in the range of $0.90 to $0.94 per diluted share.
Tax Rate
The Company is planning for a tax rate of 39% to 41% for the first quarter of fiscal 2010.
Real Estate
During the first quarter, the Company plans to open 35 new stores consisting of 3 Gymboree stores, 6 Gymboree Outlets, and 26 Crazy 8 stores.
Management Presentation
The live broadcast of the discussion of fourth quarter and full fiscal year 2009 financial results and plans for fiscal 2010 will be available to interested parties at 1:30 p.m. PT (4:30 p.m. ET) on Wednesday, March 10, 2010. To listen to the live broadcast over the internet, please log on to 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 PT, Wednesday, March 17, 2010, at 800-642-1687 passcode 54961987.
About The Gymboree Corporation
The Gymboree Corporation's specialty retail brands offer unique, high-quality products delivered with personalized customer service. As of February 27, 2010, the Company operated a total of 960 retail stores: 629 Gymboree® stores (593 in the United States, 34 in Canada and 2 in Puerto Rico), 140 Gymboree Outlet stores, 119 Janie and Jack® shops and 72 Crazy 8® stores in the United States. The Company also operates online stores at www.gymboree.com, www.janieandjack.com and www.crazy8.com, and offers directed parent-child developmental play programs at 655 franchised and Company-operated Play & Music® centers in the United States and 30 other countries.
Forward-Looking Statements
The foregoing financial information for the fourth fiscal quarter and year ended January 30, 2010, 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, planned store 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 high levels of unemployment and consumer debt, volatility in the financial markets, 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, general economic conditions, 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 March 10, 2010. 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 13 52 52
Weeks Ended Weeks Ended Weeks Ended Weeks Ended
January 30, January 31, January 30, January 31,
2010 2009 2010 2009
---- ---- ---- ----
Net sales:
Retail $295,689 $284,828 $1,001,527 $987,859
Play & Music 3,872 3,893 13,384 12,819
----- ----- ------ ------
Total net sales 299,561 288,721 1,014,911 1,000,678
Cost of goods sold,
including
buying and
occupancy expenses (159,520) (164,465) (535,005) (524,477)
-------- -------- -------- --------
Gross profit 140,041 124,256 479,906 476,201
Selling, general and
administrative
expenses (86,425) (80,624) (316,268) (327,893)
------- ------- -------- --------
Operating income 53,616 43,632 163,638 148,308
Other income 428 482 1,095 1,331
--- --- ----- -----
Income before
income taxes 54,044 44,114 164,733 149,639
Income tax expense (20,848) (14,629) (62,814) (56,159)
------- ------- ------- -------
Net income $33,196 $29,485 $101,919 $93,480
======= ======= ======== =======
Net income per share:
Basic $1.16 $1.05 $3.55 $3.35
Diluted $1.11 $1.00 $3.41 $3.21
Weighted average shares
outstanding:
Basic 28,661 28,095 28,679 27,919
Diluted 30,016 29,398 29,855 29,154
Operating Data:
Stores Open at the
Beginning of the
Period 950 873 886 786
New Stores 8 15 72 105
Closed Stores (5) (2) (5) (5)
--- --- --- ---
Stores Open at the
End of the Period 953 886 953 886
=== === === ===
Gross Store Square
Footage 1,879,000 1,735,000 1,879,000 1,735,000
Merchandise
Inventories per
Square Foot $64 $66 $64 $66
Supplemental Financial
Information:
Depreciation and
amortization $9,839 $9,073 $37,302 $34,854
Interest income, net $21 $535 $485 $1,482
Stock-based
compensation $5,669 $5,488 $18,462 $19,850
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
January 30, January 31,
2010 2009
---- ----
Current Assets
Cash and cash
equivalents $257,672 $140,472
Accounts receivable 9,911 18,735
Merchandise
inventories 121,133 114,972
Prepaid expenses
and deferred taxes 19,778 19,704
------ ------
Total current
assets 408,494 293,883
------- -------
Property and
Equipment, net 205,461 204,227
Deferred Taxes and
Other Assets 22,175 22,471
Total Assets $636,130 $520,581
======== ========
Current Liabilities
Accounts payable $46,470 $44,400
Accrued liabilities 69,295 69,341
Income tax payable 5,381 102
----- ---
Total current
liabilities 121,146 113,843
------- -------
Long-Term Liabilities
Lease incentives
and other deferred
liabilities 76,231 72,463
Stockholders' Equity 438,753 334,275
------- -------
Total Liabilities
and Stockholders'
Equity $636,130 $520,581
======== ========
SOURCE The Gymboree Corporation
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