Bakers Footwear Reports First Quarter Results
02 June 2006 - 9:00PM
Business Wire
Bakers Footwear Group, Inc. (Nasdaq: BKRS), a leading specialty
retailer of moderately priced fashion footwear for young women,
today announced results for the thirteen weeks ended April 29,
2006. For the first quarter, the thirteen weeks ended April 29,
2006: -- Net sales increased 10.8%, to $49.8 million from $44.9
million for the thirteen weeks ended April 30, 2005. Comparable
store sales decreased 0.8% compared to a 7.8% increase in the first
quarter last year; -- Operating income was $ 1.2 million, or 2.4%
of net sales, as compared to $3.1 million, or 6.9% of net sales in
the same period a year ago; -- Net income was $0.7 million, or 1.3%
of net sales, versus $1.9 million, or 4.1% of net sales in the
first quarter of 2005; -- Diluted earnings per share were $0.10,
compared to diluted earnings per share of $0.33 in the first
quarter of 2005; and -- As a result of adopting FAS 123R, we
recognized $0.02 per share related to stock based compensation
expense in the first quarter of 2006. We recognized no stock-based
compensation expense in the first quarter of 2005. Peter Edison,
Chairman and Chief Executive Officer of Bakers Footwear Group said,
"We are disappointed with our first quarter performance, which
reflected softness in the sandal category of our business and
resulted in lower margins, as we incurred higher markdowns versus
the first quarter last year. Our comparable first quarter sales
trend continues into the second quarter." Additionally, during the
first quarter, the Company: -- Opened 12 new stores in our new
Bakers format and at quarter-end operated a total of 245 Bakers and
Wild Pair stores in 38 states; and -- Remodeled 5 stores and at
quarter-end operated 135 stores, or 62% of its Bakers stores, in
the new store format. "We continue to be pleased with our store
expansion program," Mr. Edison, stated. "We currently expect to
open 30 to 35 new stores while remodeling approximately 20
locations this year." Gross profit in the first quarter of 2006 was
$16.3 million, or 32.7% of net sales, compared to $15.4 million, or
34.3% of net sales, in the first quarter of 2005. Gross profit rose
due to the increase in new stores versus the first quarter last
year; this was offset by higher markdowns and a modest decline in
comparable store sales for the quarter. Operating expenses were
$15.1 million, or 30.3% of net sales compared to $12.3 million, or
27.4% of net sales in the first quarter of 2005. The Company
incurred higher costs related to depreciation and payroll
associated with its store expansion. In addition, the Company
incurred $214,000 in pre-tax stock based compensation expense in
the first quarter this year related to the adoption on January 29,
2006 of FAS 123R Share-Based Payment. Michele Bergerac, President
of Bakers Footwear, said, "We are not satisfied with our first
quarter performance, which followed several quarters of strong
performance. We are excited by our fall assortment and expect to
benefit as we capitalize on several emerging fashion trends." Mr.
Edison continued: "We believe our marketing and merchandising
initiatives, combined with our new store format plan will pave the
way for long term sales and earnings growth. We also continue to
see significant long-term opportunities for new store expansion."
Conference Call The Company announced that it will conduct a
conference call to discuss its first quarter of fiscal 2006 results
today, Friday, June 2, 2006 at 9:00 a.m. Eastern Time. Investors
and analysts interested in participating in the call are invited to
dial (800) 817-4887, approximately five minutes prior to the start
of the call. The conference call will also be web-cast live at
http://viavid.net/dce.aspx?sid=000031F5. A replay of this call will
be available until June 9, 2006 and can be accessed by dialing
(888) 203-1112 and entering code 8160478. The web-cast will be
available until July 2, 2006 at the same web address. About Bakers
Footwear Group, Inc. Bakers Footwear Group is a national,
mall-based, specialty retailer of distinctive footwear and
accessories for young women. The Company's merchandise includes
private label and national brand dress, casual and sport shoes,
boots, sandals and accessories. The Company currently operates more
than 225 stores nationwide under two formats, Bakers and Wild Pair.
Bakers stores focus on women between the ages of 16 and 35. Wild
Pair stores offer fashion-forward footwear to both women and men
between the ages of 17 and 29. THIS PRESS RELEASE CONTAINS
FORWARD-LOOKING STATEMENTS (WITHIN THE MEANING OF SECTION 27(A) OF
THE SECURITIES ACT OF 1933 AND SECTION 21(E) OF THE SECURITIES
EXCHANGE ACT OF 1934). BAKERS FOOTWEAR HAS NO DUTY TO UPDATE SUCH
STATEMENTS. ACTUAL FUTURE EVENTS AND CIRCUMSTANCES COULD DIFFER
MATERIALLY FROM THOSE SET FORTH IN THIS STATEMENT DUE TO VARIOUS
FACTORS. FACTORS THAT COULD CAUSE THESE CONDITIONS NOT TO BE
SATISFIED INCLUDE MATERIAL CHANGES IN CAPITAL MARKET CONDITIONS OR
IN BAKERS FOOTWEAR'S BUSINESS, PROSPECTS, RESULTS OF OPERATIONS OR
FINANCIAL CONDITION AND OTHER RISKS AND UNCERTAINTIES, INCLUDING
THOSE DETAILED IN BAKERS FOOTWEAR'S FILINGS WITH THE SECURITIES AND
EXCHANGE COMMISSION. -0- *T Bakers Footwear Group, Inc. Thirteen
Thirteen (in thousands, except per share data) Weeks Ended Weeks
Ended April 29, April 30, Income Statement Data 2006 2005
----------------------------------------------------------------------
Unaudited Unaudited Net Sales $ 49,805 $ 44,943 Cost of merchandise
sold, occupancy, and buying expenses 33,508 29,537
----------------------- Gross profit 16,297 15,406 Selling expenses
10,398 8,627 General and administrative expenses 4,699 3,557 Loss
on disposal of property and equipment 15 140
----------------------- Operating income 1,185 3,082 Interest
expense (113) (126) Other, net 23 36 ----------------------- Income
before income taxes 1,095 2,992 Income tax expense 427 1,141
----------------------- Net income $ 668 $ 1,851
======================= Basic earnings per share $ 0.11 $ 0.35
======================= Diluted earnings per share $ 0.10 $ 0.33
======================= Weighted average shares outstanding Basic
6,332 5,344 Diluted 6,811 5,599 Cash Flow Data
----------------------------------------------------------------------
Cash provided by (used in) operating activities (7,179) 382 Cash
used in investing activities (4,836) (4,278) Cash provided by
financing activities 8,286 7,372 Supplemental Data
----------------------------------------------------------------------
Comparable store sales increase (decrease) (0.8%) 7.8% Gross profit
percentage 32.7% 34.3% Number of stores at end of period 245 221
April 29, April 30, Balance Sheet Data 2006 2005
----------------------------------------------------------------------
Unaudited Unaudited Cash $ 196 $ 4,909 Accounts receivable 2,583
2,012 Inventories 28,199 20,416 Other current assets 2,665 3,073
----------------------- Current assets 33,643 30,410 Property and
equipment, net 41,827 24,772 Other assets 846 499
----------------------- $ 76,316 $ 55,681 =======================
Current liabilities $ 26,193 $ 15,497 Noncurrent liabilities 7,276
5,565 Shareholders' equity 42,847 34,619 ----------------------- $
76,316 $ 55,681 ======================= *T
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