MINNEAPOLIS, Jun 28, 2007 -- Christopher & Banks Corporation (NYSE:CBK) today reported results for the first quarter ended June 2, 2007.
First Quarter Results
Total sales for the first quarter ended June 2, 2007 were $149.4 million compared to $142.5 million for the quarter ended May 27, 2006. Net income for the first quarter was $11.7 million or $0.32 per diluted share compared to $14.6 million or $0.39 per diluted share for the first quarter last year. Same-store sales for the thirteen week period ended June 2, 2007 declined 4% compared to the thirteen week period ended June 3, 2006. The Company opened 25 new stores and closed two stores in the first quarter bringing the total number of stores to 801 as of June 2, 2007, compared to 739 as of May 27, 2006. As compared to the end of last year's first quarter, the Company experienced a 26 percent year over year increase in inventory on a per store basis. Approximately half of this increase was due to a larger combined balance of early June receipts and in-transit inventory.
Financial Outlook
As a result of above plan inventories at the end of the first quarter and a challenging women's specialty retail environment, the Company expects a higher level of clearance activity will be required to exit the second quarter with a current inventory position. Therefore, the Company currently anticipates second quarter earnings per diluted share to be in the range of $0.11 to $0.12, compared to $0.21 last year. Fiscal June same-store sales month-to-date through June 27, 2007 were up 2%. For the year, the Company estimates earnings per diluted share to be in the range of $0.80 to $0.83, compared to $0.89 per share last year.
Matt Dillon, President and Chief Executive Officer of Christopher & Banks Corporation, commented, "We have taken steps to better align our Fall assortment with our customers' fashion needs. Our merchandise deliveries for the second half of the year are anticipated to be lower than last year on a per store basis. We believe lower per store receipts combined with continued merchandise improvements will allow us to deliver stronger performance in the second half of the year as compared to last year."
Conference Call Information
The Company will discuss its first quarter results in a conference call scheduled for today, June 28, 2007 at 5:00 pm Eastern time. The conference call will be simultaneously broadcast live over the internet at http://www.christopherandbanks.com. An online archive of the broadcast will be available within one hour of the completion of the call and will be accessible at http://www.christopherandbanks.com until July 12, 2007. In addition, an audio replay of the call will be available shortly after its conclusion and archived until July 5, 2007. This call may be accessed by dialing (888) 203-1112 pass code 5455661.
About Christopher & Banks
Christopher & Banks Corporation is a Minneapolis-based specialty retailer of women's clothing. The Company currently operates 803 stores under the names Christopher & Banks, CJ Banks and Acorn. The Company currently has 528 Christopher & Banks stores, 237 CJ Banks stores and 38 Acorn stores.
This release contains forward-looking statements including statements regarding the Company's (i) expectation of an improved inventory position at the end of the second quarter as a result of a higher level of second quarter clearance activity; (ii) anticipated second quarter fiscal 2008 earnings of $0.11 to $0.12 per diluted share; (iii) anticipated full year fiscal 2008 earnings of $0.80 to $0.83 per diluted share; and (iv) the Company's expectation for stronger performance in the second half of fiscal 2008 as compared to last year as a result of lower per store receipts combined with continued merchandise improvements. The achievement of such results is subject to certain risk factors and uncertainties and actual results may differ materially from those projected. Such risk factors include, but are not limited to, adverse changes in economic, market and weather conditions, shifts in consumer tastes and spending habits that result in decreased sales, failure to realize expected economies gained through the use of private label and direct import merchandise, problems in managing our growth, inability to obtain acceptable lease terms for new store locations and other factors outside the Company's control, including factors discussed from time to time in the Company's filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on forward-looking statements, which reflect management's analysis only as of the date hereof. The Company undertakes no obligation to update these forward-looking statements to reflect events or circumstances that may arise after the date hereof.
CHRISTOPHER & BANKS CORPORATION
UNAUDITED COMPARATIVE INCOME STATEMENT
FOR THE QUARTERS ENDED
JUNE 2, 2007 AND MAY 27, 2006
(in thousands, except per share data)
Quarter Ended
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June 2, May 27,
2007 2006
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Net sales $149,371 $142,530
Costs and expenses:
Merchandise, buying and occupancy 86,916 78,562
Selling, general and administrative 39,079 36,081
Depreciation and amortization 5,295 4,981
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Total costs and expenses 131,290 119,624
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Operating income 18,081 22,906
Interest income 1,059 962
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Income before income taxes 19,140 23,868
Income tax provision 7,465 9,261
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Net income $11,675 $14,607
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Basic earnings per share:
Net income $0.32 $0.40
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Basic shares outstanding 36,190 36,408
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Diluted earnings per share:
Net income $0.32 $0.39
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Diluted shares outstanding 36,305 37,032
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Dividends per share $0.06 $0.04
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CHRISTOPHER & BANKS CORPORATION
UNAUDITED COMPARATIVE BALANCE SHEET
(in thousands)
June 2, May 27,
2007 2006
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ASSETS
Current assets:
Cash and cash equivalents $52,179 $68,067
Short-term investments 44,425 44,525
Merchandise inventories 58,830 42,937
Other current assets 19,749 11,309
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Total current assets 175,183 166,838
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Property, equipment and improvements, net 129,630 121,686
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Other assets:
Goodwill 3,587 3,587
Other 1,973 927
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Total other assets 5,560 4,514
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Total assets $310,373 $293,038
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $13,646 $6,447
Accrued liabilities 29,074 35,032
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Total current liabilities 42,720 41,479
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Other liabilities:
Deferred lease incentives 22,678 21,338
Other 14,770 12,509
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Total other liabilities 37,448 33,847
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Stockholders' equity:
Common stock 451 435
Additional paid-in capital 107,325 77,697
Retained earnings 223,004 200,156
Common stock held in treasury (100,575) (60,576)
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Total stockholders' equity 230,205 217,712
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Total liabilities and stockholders' equity $310,373 $293,038
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