News Releases
Brookstone Announces First Quarter 2002 Results
NASHUA, N.H., May 22, 2002 -- Brookstone, Inc. (Nasdaq:BKST) today announced results for the first quarter ended May 4, 2002.
For the first quarter of Fiscal 2002 the Company reported a net loss of $6.5 million, or $0.78 per diluted share, compared to a net loss of $5.2 million or $0.62 per diluted share for the first quarter of Fiscal 2001. Total sales for the thirteen-week period ended May 4, 2002 increased 3.0% to $56.6 million compared to $55.0 million for the first quarter of last year. Same store sales for the comparable thirteen-week period decreased 3.3%. Direct marketing sales for the first quarter decreased 3.4% on a circulation decrease of 20%.
Michael Anthony, Chairman, President and Chief Executive Officer, commented, "We are pleased that our first quarter net loss was less than previously released estimates. Same store sales trends have continued to improve since the third quarter of last year. New product penetration as a percent of total sales continues to increase. The Direct Marketing channel exceeded expectations, and operating results for this segment improved substantially over the first quarter of the prior year due to a strong increase in sales per book and significant growth in the Internet. In addition, we were able to leverage SG&A expenses through continued expense control."
Mr. Anthony continued, "We completed the quarter in strong financial condition, with inventories 10% below the first quarter of last year, while providing for 23 additional stores. Additionally, we ended the quarter with approximately $10 million more in cash than at the end of the first quarter of last year."
Mr. Anthony further commented, "Looking to our second quarter, we believe the net loss will range between $0.17 to $0.23 per diluted share as compared to last year's second quarter loss of $0.33 per diluted share. We feel we are on track to meet our earnings target for the year of between $1.20 to $1.25 per diluted share."
Brookstone, Inc. is a nationwide specialty retailer that operates 248 stores in 39 states, Puerto Rico and the District of Columbia. Typically located in high-traffic regional shopping malls and airports, the stores feature unique and innovative consumer products. The Company also operates a direct marketing business that consists of three catalogs; The Brookstone Catalog, Hard-to-Find Tools and Gardeners Eden catalog; as well as an e-commerce web site at http://www.Brookstone.com.
Statements in this release which are not historical facts, including statements about the Company's confidence or expectations, earnings, anticipated operations of its e-commerce sites and those of third-party service providers, and other statements about the Company's operational outlook, are forward-looking statements subject to risks and uncertainties that could cause actual results to differ materially from those set forth in such forward-looking statements. Such risks and uncertainties include, without limitation, risks of changing market conditions in the overall economy and the retail industry, consumer demand, the effectiveness of e-commerce technology and marketing efforts, availability of products, availability of adequate transportation of such products, and other factors detailed from time to time in the Company's annual and other reports filed with the Securities and Exchange Commission. Words such as "estimate", "project", "plan", "believe", "feel", "anticipate", "assume", "may", "will", "should" and similar words and phrases may identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date thereof. The Company undertakes no obligations to publicly release any revisions to these forward-looking statements or reflect events or circumstances after the date hereof.
Brookstone, Inc.
Consolidated Statement of Operations
($ in thousands)
(Unaudited)
Thirteen Weeks Ended
May 4, 2002 May 5, 2001
Net sales $56,633 $54,997
Cost of sales 43,742 40,841
Gross profit 12,891 14,156
Selling, general and 23,098 22,648
administrative expenses
Loss from operations (10,207) (8,492)
Interest (income) expense, net 307 (61)
Loss before taxes (10,514) (8,431)
Income tax benefit (3,995) (3,238)
Net loss $(6,519) $(5,193)
Basic / diluted loss per share:
Net loss $(0.78) $(0.62)
Weighted average shares outstanding
Basic/diluted 8,407 8,336
Brookstone, Inc.
Consolidated Balance Sheet
($ in thousands)
Unaudited
May 4, 2002 May 5, 2001 February 2, 2002
Current Assets:
Cash and cash
equivalents $ 14,156 $3,774 $ 28,928
Receivables, net 6,222 4,686 8,170
Merchandise inventories 57,646 64,314 55,629
Deferred income taxes, net 7,824 7,054 3,447
Other current assets 5,009 5,453 4,933
Total current assets 90,857 85,281 101,107
Deferred income taxes, net 4,536 3,662 4,536
Property and equipment, net 43,258 42,160 45,058
Intangible assets, net 4,676 5,222 4,812
Other assets 2,720 2,365 1,592
Total assets $146,047 $138,690 $157,105
Liabilities and Shareholders' Equity
Current Liabilities:
Accounts payable $10,400 $12,304 $11,232
Other current liabilities 17,748 14,562 22,569
Total current liabilities 28,148 26,866 33,801
Other long term liabilities 13,407 11,896 13,246
Long term obligation
under capital lease 2,238 2,387 2,273
Commitments and Contingencies
Common stock 8 8 8
Additional paid-in capital 51,654 50,500 50,666
Retained earnings 50,639 47,080 57,158
Treasury stock, at cost (47) (47) (47)
Total shareholders'
equity 102,254 97,541 107,785
Total liabilities and
shareholders' equity $146,047 $138,690 $157,105
Contacts: Philip Roizin, EVP of Finance and Administration (603) 880-9500 Robert Fusco, Investor Relations Brookstone (603) 880-9500