bebe stores announces Q4 earnings of $0.02 per share
31 Aug '10
6 min read
The effective tax rate for the fiscal year ended July 3, 2010 increased to 35.0% from 23.7% in fiscal 2009 primarily attributable to a lower tax rate in the prior fiscal year due to a tax refund recorded from amended 2006 returns and exempt interest income as a percent of income before tax.
Net loss for the fiscal year ended July 3, 2010 was $5.2 million compared to net income of $12.6 million in the prior year. Diluted loss per share for the fiscal year ended July 3, 2010 was $0.06 which includes $0.06 per share after tax reduction due to store impairment charges primarily associated with the discontinuation of PH8 operations. This compares to diluted earnings per share of $0.14 in the prior year which includes $0.06 per share, net of tax, due to impairment as previously discussed.
In fiscal 2010, PH8 operating loss after taking into account $6.7 million of impairment charges was $22.2 million, compared to $9.2 million in the prior year after taking into account $3.9 million of impairment charges.
During the current quarter, we have purchased approximately 2,100,000 of outstanding shares or $12.5 million, and have completed the $30.0 million of purchased under the previously announced stock purchase plan.
During the quarter ended July 3, 2010, the Company opened 1 bebe store, 2 2b bebe locations, and closed 6 stores, resulting in a net 1% square footage decrease. During the fiscal year ended July 3, 2010, the Company opened 5 bebe stores, 2 2b bebe stores, 1 PH8 pop-up location, and closed 19 stores, resulting in a net 2% square footage decrease. For the fiscal year the Company's capital expenditures were approximately $15.1 million and depreciation expense was approximately $26.3 million.
For the first quarter of fiscal 2011, the Company currently anticipates that comparable store sales will be in the low to mid-single digit negative range and depending on actual sales and markdowns the net earnings will be in the range of $0.02 in loss per share to $0.02 in income per share based on 84.3 million diluted weighted average shares outstanding versus a net loss of $0.05 per share based on 86.8 million diluted weighted average shares outstanding in the first quarter of fiscal 2010.
This projection excludes costs related to future lease liabilities and potential salary expenses associated with the closure or conversion of 23 PH8 stores by the end of the fiscal first quarter. The Company is currently anticipating an effective tax rate of 40% for fiscal 2011.
For fiscal 2011, the Company anticipates opening 3 bebe locations, 5 2b bebe locations and closing 49 stores, resulting in a net 9% decrease in square footage. The number of closures includes 1 bebe store and 48 PH8 stores, with 23 locations to close by the end of the fiscal first quarter and 25 locations to close by the end of the fiscal year, with up to 4 locations to be converted to the 2b bebe concept.
For the firstquarter of fiscal 2011, the Company is currently planning finished goods inventory to be positive low double digits on a per square foot basis compared to a decrease of 19% in the prior year. In addition, we anticipate the Company's capital expenditures will be below $20 million for the fiscal year. Depreciation expense for the year will be approximately $24 million.
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