First Quarter Fiscal 2010 Consolidated Results • Net sales from continuing operations for the thirteen weeks ended May 2, 2009 decreased $103.2 million or 16.1% to $538.1 million, compared to $641.3 million for the thirteen weeks ended May 3, 2008. The decrease in sales was primarily as a result of a comparable store sales decrease of 13% and the impact to sales from 162 store closings during the last four quarters. Comparable store sales declined 15%, 13% and 9% at the Company's Lane Bryant, Fashion Bug and Catherines brands, respectively. • Gross profit (net sales less cost of goods sold, buying, catalog and occupancy expense) decreased $28.6 million or 14.7% to $165.5 million in the first quarter, compared to $194.2 million in the same quarter last year, primarily related to lower sales volumes, and partially offset by decreased buying, catalog and occupancy expenses. Gross profit, as a percent of sales, improved by 50 basis points to 30.8% as a percent of sales for the quarter ended May 2, 2009, compared to 30.3% as a percent of sales for the quarter ended May 3, 2008, driven by an improved merchandise margin, and offset by negative leverage on occupancy expenses from the decrease in consolidated net sales. The merchandise margin improved by 190 basis points, related to lean inventories and reduced promotional activity, particularly at the Company's Lane Bryant and Catherines brands. • Selling, general and administrative expense decreased by $28.7 million or 15.4% to $158.1 million in the first quarter, compared to $186.8 million in the same quarter last year, primarily related to the closing of under-performing stores and expense reduction initiatives. SG&A expense was 29.4% as a percent of sales, and increased by 30 basis points, primarily as a result of negative leverage from the decrease in net sales from the prior-year period. • Restructuring and non-cash interest charges of $11.6 million recorded during the quarter ended May 2, 2009 include $8.7 million, primarily related to accelerated depreciation on discontinued or divested catalog businesses, and $2.9 million for accretion of discount on the Company's Notes related to the retrospective adoption of FSP APB 14-1. $6.7 million of these charges were non-cash charges. Restructuring and non-cash interest charges of $6.3 million recorded during the quarter ended May 3, 2008 included charges of $3.6 million in accelerated depreciation related to consolidation and streamlining initiatives, and $2.7 million for accretion of discount on the Company's Notes related to the adoption of FSP APB 14-1. • Income from operations, excluding $8.7 million in restructuring charges, was $7.4 million, essentially flat year over year on a 16% sales decline.
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.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "UBM China (Shanghai)")
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