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Talbots profitable third quarter exceeds expectations
09 Dec '09
5 min read
• Total ending inventory decreased $60 million over prior year, a 29% decline on a per square foot basis.
Total sales from continuing operations for the thirteen weeks ended October 31, 2009 were slightly better than Company expectations and were $308.9 million compared to last year's sales of $357.3 million. Retail store sales for the thirteen weeks were $255.4 million compared to $303.5 million last year. Comparable store sales declined 15.9% for the thirteen week period.
Direct marketing sales for the thirteen-week period were $53.5 million, including catalog and Internet, compared to $53.8 million last year.
Comprehensive Financing Solution Launched :
In a separate press release issued today, the Company also said it is undertaking a comprehensive financing solution to delever its balance sheet and accelerate growth. It consists of three related transactions: an Agreement and Plan of Merger between Talbots and BPW Acquisition Corp. pursuant to which Talbots will acquire BPW in exchange for Talbots common stock; the retirement of all equity currently held by Talbots majority stockholder, Aeon (U.S.A.), Inc., and the repayment of all of the Company's existing debt and a commitment for a new $200 million senior secured revolving credit facility from GE Capital.
Results for the Thirty-Nine Week Period:
For the thirty-nine week period, net loss from continuing operations on an adjusted basis, excluding restructuring and impairment charges, was $12.8 million or $0.24 per share, compared to last year's net loss on a comparable basis of $103 thousand or breakeven.
Net loss from continuing operations on a reported (GAAP) basis was $23.8 million or $0.44 per share, including restructuring and impairment charges of $11.0 million or $0.20 per share, compared to last year's net loss from continuing operations of $8.2 million or $0.15 per share for the nine-month period ended November 1, 2008, including restructuring and impairment charges of $8.1 million or $0.15 per share.
Total sales from continuing operations were $919.7 million for the nine-month period, compared to last year's sales of $1,167.3 million. Retail store sales were $766.7 million compared to $982.9 million last year. Comparable store sales declined 22.8% for the nine-month period. Direct marketing sales for the nine-month period were $153.0 million, including catalog and Internet, compared to $184.4 million last year.
Outlook:
For the fourth fiscal quarter of 2009, the Company currently anticipates a loss from continuing operations in the range of $0.06 to $0.14 per share, excluding restructuring and impairment charges and other special items. This anticipated result is based on a top-line sales decline planned to be in the range of approximately 6% to 8%. Talbots expects fourth quarter top line sales to be impacted by reduced levels of markdown merchandise. The Company'sgoal for the fourth quarter is to continue to operate on leaner and fresher inventory to drive improved profitability.
The above outlook is based on the Company's current internal assumptions and estimates, is subject to its accompanying forward-looking statement and is not a guarantee of future performance.
Total sales from continuing operations for the thirteen weeks ended October 31, 2009 were slightly better than Company expectations and were $308.9 million compared to last year's sales of $357.3 million. Retail store sales for the thirteen weeks were $255.4 million compared to $303.5 million last year. Comparable store sales declined 15.9% for the thirteen week period.
Direct marketing sales for the thirteen-week period were $53.5 million, including catalog and Internet, compared to $53.8 million last year.
Comprehensive Financing Solution Launched :
In a separate press release issued today, the Company also said it is undertaking a comprehensive financing solution to delever its balance sheet and accelerate growth. It consists of three related transactions: an Agreement and Plan of Merger between Talbots and BPW Acquisition Corp. pursuant to which Talbots will acquire BPW in exchange for Talbots common stock; the retirement of all equity currently held by Talbots majority stockholder, Aeon (U.S.A.), Inc., and the repayment of all of the Company's existing debt and a commitment for a new $200 million senior secured revolving credit facility from GE Capital.
Results for the Thirty-Nine Week Period:
For the thirty-nine week period, net loss from continuing operations on an adjusted basis, excluding restructuring and impairment charges, was $12.8 million or $0.24 per share, compared to last year's net loss on a comparable basis of $103 thousand or breakeven.
Net loss from continuing operations on a reported (GAAP) basis was $23.8 million or $0.44 per share, including restructuring and impairment charges of $11.0 million or $0.20 per share, compared to last year's net loss from continuing operations of $8.2 million or $0.15 per share for the nine-month period ended November 1, 2008, including restructuring and impairment charges of $8.1 million or $0.15 per share.
Total sales from continuing operations were $919.7 million for the nine-month period, compared to last year's sales of $1,167.3 million. Retail store sales were $766.7 million compared to $982.9 million last year. Comparable store sales declined 22.8% for the nine-month period. Direct marketing sales for the nine-month period were $153.0 million, including catalog and Internet, compared to $184.4 million last year.
Outlook:
For the fourth fiscal quarter of 2009, the Company currently anticipates a loss from continuing operations in the range of $0.06 to $0.14 per share, excluding restructuring and impairment charges and other special items. This anticipated result is based on a top-line sales decline planned to be in the range of approximately 6% to 8%. Talbots expects fourth quarter top line sales to be impacted by reduced levels of markdown merchandise. The Company'sgoal for the fourth quarter is to continue to operate on leaner and fresher inventory to drive improved profitability.
The above outlook is based on the Company's current internal assumptions and estimates, is subject to its accompanying forward-looking statement and is not a guarantee of future performance.
The Talbots Inc
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