MINNEAPOLIS, Apr 15, 2010 -- Full Year Fiscal 2010 EPS of $0.00
Christopher & Banks Corporation (NYSE:CBK) today reported results for its fiscal 2010 fourth quarter and year ended February 27, 2010.
For the Fourth Quarter Ended February 27, 2010
-- Total net sales were $101.9 million as compared to $103.9 million in the fourth quarter of fiscal 2009. Fourth quarter fiscal 2010 same-store sales decreased 4%.
-- Gross profit for the quarter increased 66.7% to $32.5 million and, as a percentage of net sales, gross margin increased to 31.9% for the quarter from 18.8% in the fourth quarter of fiscal 2009.
-- The operating loss for the fourth quarter of fiscal 2010 totaled $10.1 million and includes a $2.9 million store asset impairment charge. This compares to a $34.9 million operating loss for the fourth quarter of fiscal 2009, which included $7.3 million in one-time charges related to severance costs, software and implementation related costs, and store asset impairment charges of $4.6 million.
-- Net loss per share from continuing operations for the fourth quarter was $0.18, which includes a $0.05 per share store asset impairment charge.
-- Cash, cash equivalents and investments totaled $113 million.
-- Inventory per store at fiscal year-end (excluding e-Commerce) was down 3% from prior year-end.
Lorna Nagler, President and Chief Executive Officer, commented, "We are very pleased to have ended the year on a positive note with comparable store sales gains during the last two months of the year and having made significant progress on our operational initiatives. As we look ahead, we are encouraged by our prospects for profitable growth. The advances we are making in our merchandising and marketing efforts, our stronger operating platform and our healthy balance sheet positions us well to drive shareholder value."
For the Fiscal Year Ended February 27, 2010
-- Total sales from continuing operations were $455.4 million for the fiscal year ended February 27, 2010, compared to $530.7 million for the fifty-two week period ended February 28, 2009. Same-store sales decreased 15% for fiscal 2010.
-- The pre-tax loss from continuing operations was $639,000 in fiscal 2010, compared to a pre-tax loss from continuing operations of $12.3 million in fiscal 2009.
-- Net income from continuing operations was $0.2 million, or $0.00 per share, for fiscal 2010, including non-cash asset impairment charges of $2.9 million. This compares to a net loss from continuing operations of $8.1 million, or $0.23 per share, for fiscal 2009, including non-cash store asset impairment charges of $4.6 million and other one-time charges related to severance costs and software and implementation related costs, for a total of $7.3 million of one-time charges. Including discontinued operations, the net loss in fiscal 2009 was $12.8 million, or $0.36 per share.
-- The effective tax rate for the fourth quarter was approximately 35%. Due to the Company's near break-even results for the year, small discrete tax items and state tax considerations had a significant impact on the Company's annual effective tax rate. As a result, the effective tax rate for the year was approximately 125%.
-- As of February 27, 2010, the Company operated 806 stores compared to 815 stores as of February 28, 2009.
Balance Sheet Highlights
The Company ended fiscal 2010 with total cash, cash-equivalents and investments of $113 million. Inventory, excluding e-Commerce inventory, decreased approximately 3% on a per-store basis at the end of the fourth quarter of fiscal 2010, as compared to the end of the fourth quarter of fiscal 2009. The Company has a strong balance sheet and management believes that its cash and cash-equivalents are sufficient to meet the Company's cash and liquidity needs for the current fiscal year.
Capital Expenditures
Fiscal 2010 capital expenditures were approximately $6 million.
Fiscal 2011 Outlook
-- The Company expects a mid to high single-digit increase in comparable store sales in the first quarter of fiscal 2011.
-- For the first quarter of fiscal 2011, total gross margin is expected to improve by a couple of hundred basis points.
-- SG&A, as a percent of sales, is expected to be flat to slightly lower in the first quarter of fiscal 2011 as compared to the same quarter in the prior year.
-- Capital expenditures are expected to be $12 to $14 million for the full fiscal year.
-- The Company currently plans to open approximately 10 new stores and close 25 existing stores in fiscal 2011.
Conference Call Information
The Company will discuss its fourth quarter and full year results in a conference call scheduled for today, April 15, 2010, at 5:00 p.m. 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 April 22, 2010. In addition, an audio replay of the call will be available shortly after its conclusion and will be archived until April 22, 2010. This call may be accessed by dialing (888) 203-1112 and using password 8315484.
About Christopher & Banks
Christopher & Banks Corporation is a Minneapolis-based specialty retailer of women's clothing. As of April 15, 2010, the Company operates 799 stores in 46 states consisting of 535 Christopher & Banks stores, 262 stores in their plus size clothing division CJ Banks and two dual-concept stores. The Company also operates the www.ChristopherandBanks.com and www.CJBanks.com e-Commerce websites.
Keywords: Petites, Women's Clothing, Plus Size Clothing, Christopher & Banks, CJ Banks.
Forward-Looking Statements
Certain statements in this press release are forward-looking statements, made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements may use the words "expect", "anticipate", "plan", "intend", "project", "believe" and similar expressions and include statements (i) that the Company is encouraged by its prospects for future growth; (ii) that the advances the Company is making in merchandising and marketing efforts, its stronger operating platform and its healthy balance sheet position it well to drive shareholder value; (iii) that the Company's cash and cash equivalents are sufficient to meet the Company's cash and liquidity needs for the current fiscal year; (iv) that the Company expects a mid to high single-digit increase in comparable store sales in the first quarter of fiscal 2011; (v) that for the first quarter of fiscal 2011, total gross margin is expected to improve by a couple of hundred basis points; (vi) that SG&A, as a percent of sales, is expected to be flat to slightly lower in the first quarter of fiscal 2011 as compared to the same quarter in the prior year; (vii) that capital expenditures are expected to be $12 to $14 million for the full fiscal year; and (viii) that the Company currently plans to open approximately 10 new stores and close 25 existing stores in fiscal 2011. These statements are based on management's current expectations and are subject to a number of uncertainties and risks, as well as assumptions that, if they do not fully materialize or prove incorrect, could cause our actual results to differ materially from those expressed or implied by the forward-looking statements. Important factors that could cause actual results to differ materially from estimates or projections contained in the forward-looking statements include, but are not limited to: (i) the inherent difficulty in forecasting consumer buying and retail traffic patterns which may be affected by factors beyond our control, such as a weakness in overall consumer demand; adverse weather, economic or political conditions; and shifts in consumer tastes or spending habits that result in reduced sales; (ii) lack of acceptance of the Company's fashions, including its seasonal fashions; (iii) the ability of the Company's infrastructure and systems to adequately support our operations; (iv) effectiveness of the Company's brand awareness and marketing programs; (v) the possibility that, because of poor customer response to our merchandise, management may determine it is necessary to sell merchandise at lower than expected margins or at a loss; (vi) the failure to successfully implement the Company's strategic plans; (vii) general economic conditions could lead to a reduction in store traffic and in consumer spending on women's apparel; (viii) fluctuations in the levels of the Company's sales, expenses or earnings; and (ix) risks associated with the performance and operations of the Company's Internet operations.
Readers are cautioned not to place undue reliance on these forward-looking statements which are based on current expectations and speak only as of the date of this release. The Company does not assume any obligation to update or revise any forward-looking statement at any time for any reason.
Certain other factors that may cause actual results to differ from such forward-looking statements are included in the Company's periodic reports filed with the Securities and Exchange Commission and available on the Company's website under "Investor Relations" and you are urged to carefully consider all such factors.
CHRISTOPHER & BANKS CORPORATION
UNAUDITED COMPARATIVE STATEMENT OF OPERATIONS
FOR THE QUARTERS AND YEARS ENDED
FEBRUARY 27, 2010 AND FEBRUARY 28, 2009
(in thousands, except per share data)
Quarter Ended Year Ended
February 27, February 28, February 27, February 28,
2010 2009 2010 2009
Net sales $101,853 $103,892 $455,402 $530,742
Costs and
expenses:
Merchandise,
buying and
occupancy 69,318 84,373 289,134 341,734
Selling,
general and
administrative 32,812 43,285 138,711 172,295
Depreciation
and
amortization 6,920 6,610 25,985 26,264
Impairment of
store assets 2,939 4,557 2,939 4,557
Total costs
and expenses 111,989 138,825 456,769 544,850
Operating loss (10,136) (34,933) (1,367) (14,108)
Interest and
other expense
(income) (277) 223 (728) (1,809)
Loss from
continuing
operations
before income
taxes (9,859) (35,156) (639) (12,299)
Income tax
benefit (3,491) (6,249) (797) (4,215)
Income (loss)
from
continuing
operations (6,368) (28,907) 158 (8,084)
Income (loss)
on
discontinued
operations,
net of tax - 89 - (4,666)
Net income
(loss) $ (6,368) $(28,818) $ 158 $(12,750)
Basic earnings
(loss) per share:
Continuing
operations $ (0.18) $ (0.82) $ 0.00 $ (0.23)
Discontinued
operations - - - (0.13)
Earnings (loss)
per basic
share $ (0.18) $ (0.82) $ 0.00 $ (0.36)
Basic shares
outstanding 35,199 35,114 35,141 35,097
Diluted earnings
(loss) per share:
Continuing
operations $ (0.18) $ (0.82) $ 0.00 $ (0.23)
Discontinued
operations - 0.00 - (0.13)
Earnings (loss)
per diluted
share $ (0.18) $ (0.82) $ 0.00 $ (0.36)
Diluted shares
outstanding 35,199 35,114 35,234 35,097
Dividends per
share $ 0.06 $ 0.06 $ 0.24 $ 0.24
CHRISTOPHER & BANKS CORPORATION
UNAUDITED COMPARATIVE BALANCE SHEET
(in thousands)
February 27, February 28,
2010 2009
ASSETS
Current assets:
Cash and cash equivalents $ 37,073 $ 78,814
Short-term investments 62,251 -
Merchandise inventories 38,496 38,828
Other current assets 11,791 28,401
Total current assets 149,611 146,043
Property, equipment and improvements,
net 96,109 120,347
Other assets:
Long-term investments 13,622 16,400
Other 7,955 7,352
Total other assets 21,577 23,752
Total assets $ 267,297 $ 290,142
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 13,654 $ 19,806
Accrued liabilities 27,636 31,691
Other current liabilities - 487
Total current liabilities 41,290 51,984
Other liabilities:
Deferred lease incentives 19,578 23,506
Other 12,699 14,429
Total other liabilities 32,277 37,935
Stockholders' equity:
Common stock 457 453
Additional paid-in capital 113,584 111,763
Retained earnings 192,362 200,719
Common stock held in treasury (112,712) (112,712)
Accumulated other comprehensive income 39 -
Total stockholders' equity 193,730 200,223
Total liabilities and stockholders'
equity $ 267,297 $ 290,142