Nine Month Results:
Total sales for the nine months ended November 28, 2009 were $353.5 million, compared to $426.9 million for the nine month period ended November 29, 2008. Same-store sales for the nine months ended November 28, 2009 declined 18%. Net income from continuing operations for the nine months ended November 28, 2009 was $6.5 million or $0.18 per diluted share, compared to net income from continuing operations of $20.8 million, or $0.59 per diluted share, for the first nine months of last year.
The Company operated 812 stores as of November 28, 2009, as compared to 821 stores at November 29, 2008, excluding Acorn stores.
Outlook:
The Company continues to plan conservatively for fiscal 2010, given the economic environment, and is providing guidance only on certain key financial metrics.
• Comparable store sales are expected to decline in the high single digits for the fourth quarter of fiscal 2010 as compared to last year's fourth quarter. This expectation incorporates the negative impact from heavy winter storms experienced in our key markets during the important holiday season.
• The Company expects to recover a significant portion of gross margin in the fourth quarter as compared to last year's fourth quarter and now expects the overall gross margin rate for fiscal 2010 to be slightly higher than in fiscal 2009.
• Approximately $2 million in SG&A cost savings is expected in the fourth quarter of fiscal 2010, compared to the fourth quarter of fiscal 2009. Cost savings initiatives began to take effect in the fourth quarter of fiscal 2009 and therefore the same level of SG&A dollar decline is not expected in the fourth quarter of 2010.
• Inventory will continue to be managed conservatively. Per store inventory, which excludes e-Commerce, is expected to be up slightly on a percentage basis at the end of the fourth quarter, as compared to last year's fourth quarter, based on the expectation of improved sales trends for the Spring season.
• Capital expenditures are expected to be approximately $7 million for the full fiscal year, slightly below the Company's original plan.
• The Company currently expects to be cash flow positive for fiscal 2010.
Christopher & Banks Corporation
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