Mar '10
Comments
Bud Bergren, President and Chief Executive Officer, commented, "We recognized early on the challenges we were going to face in 2009. Initiatives were identified and implemented throughout 2008 and 2009 to improve our cost structure and better position the Company for the weakened economy as well as for the longer term. We managed our inventory conservatively, which contributed to 350 basis points of gross margin improvement in the fourth quarter and 210 basis points gross margin improvement for fiscal 2009. We controlled expenses, reducing our selling, general and administrative expenses by approximately $70 million on a year-over-year basis. We believe that as a result of these actions our organization is more appropriately structured for the environment and we have emerged a stronger company at the end of the year than we were at the beginning. The entire Bon-Ton team executed and delivered results above expectations, and I want to extend my thanks and congratulations. We will continue to move forward conservatively in fiscal 2010, but we believe our initiatives will provide for growth opportunities and continued earnings improvement in the future."
Fourth Quarter
• Comparable store sales for the fourth quarter of fiscal 2009 decreased 2.4%.
• The gross margin rate for the fourth quarter of fiscal 2009 was 38.2% of net sales, an increase of 350 basis points compared with the prior year period.
• Operating income for the fourth quarter of fiscal 2009 increased 67% to $101.4 million, compared with operating income of $60.8 million reported in the fourth quarter of fiscal 2008. Operating income in the fourth quarter of each fiscal 2009 and fiscal 2008 included non-cash charges to reduce the value of long-lived and intangible assets of $5.4 million and $25.9 million, respectively.
• EBITDA increased $18.6 million in the fourth quarter of fiscal 2009 to $135.3 million, compared with $116.7 million in the fourth quarter of fiscal 2008. EBITDA is defined as earnings before interest, income taxes and depreciation and amortization, including amortization of lease-related interests, and goodwill and other non-cash impairment charges. EBITDA is not a measure recognized under generally accepted accounting principles (See Note 1).
• Net income totaled $80.3 million, or $4.34 per diluted share, for the fourth quarter of fiscal 2009 compared with a net loss of $87.7 million, or $5.22 per diluted share, for the fourth quarter of fiscal 2008. The Company recorded a non-cash impairment charge of $5.4 million related to long-lived and intangible assets and a favorable tax carry-back of $6.3 million in the fourth quarter of fiscal 2009. In the fourth quarter of fiscal 2008, the Company recorded charges of $25.9 million to reduce the reported value of long-lived and intangible assets and $108.5 million to provide a deferred tax asset valuation allowance.
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