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Bon-Ton CEO pleased with 2010 results; excited about 2011
16 Mar '11
5 min read
Mr. Bergren continued, “We were pleased with our positive comparable store sales increase in the fourth quarter. Our operating income increased 12% in the fourth quarter of fiscal 2010, compared with the prior year period, and 56% for the full year. While gross margin rate decreased 110 basis points in the fourth quarter, we delivered a 50 basis-point increase on a full-year basis, increasing the rate to 37.6% of net sales.
"We also controlled expenses, reducing our selling, general and administrative expenses by $13.9 million in the fourth quarter and $21.0 million in fiscal 2010. The results drove an EBITDA increase of $5.4 million in the fourth quarter and $34.5 million in fiscal 2010.”
Mr. Bergren concluded, “Looking ahead, I am excited about 2011. Over the past three years, we have taken the necessary steps to navigate the Company through a challenging economic period.
"In 2011, we believe we have many opportunities for top-line growth and increased profitability by tailoring our merchandise assortments to our markets, furthering private brand development and growing eCommerce, as well as optimizing advertising through emerging media channels. All our initiatives underscore our goal of being the provider of fashion and quality at great value.”
Guidance
Keith Plowman, Executive Vice President and Chief Financial Officer, stated, “As noted in the Company's February 3, 2011 press release, with excess borrowing capacity under our revolving credit facility of approximately $472 million at the end of fiscal 2010, the Company paid in full its $75 million second lien term loan on January 31, 2011.”
Mr. Plowman continued, “Further addressing the debt structure of Bon-Ton, we are pleased to announce we have commitments to amend and restate our credit facility agreement for a five-year period, subject to customary closing conditions. The terms, which will be disclosed when the facility closes, provide for more advantageous interest rates and fees, and generally more favorable terms to the Company.”
“Our fiscal 2011 guidance for EBITDA is a range of $235 million to $255 million and for income per diluted share a range of $1.00 to $1.50,” added Mr. Plowman. “Additionally, our estimate for cash flow is a range of $45 million to $60 million, which, we believe, will permit us to manage and reduce our debt levels. Assumptions reflected in our full-year guidance include the following:
• Comparable store sales in a range of 1.5% to 3.5% increase;
• Gross margin rate flat to down 30 basis points to fiscal 2010;
• SG&A expense as a percent to sales flat to fiscal 2010;
• Effective tax rate of 38%;
• Capital expenditures not to exceed $80 million, net of external contributions; and
• Estimated 19.5 million to 20.0 million average shares outstanding.”
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"We also controlled expenses, reducing our selling, general and administrative expenses by $13.9 million in the fourth quarter and $21.0 million in fiscal 2010. The results drove an EBITDA increase of $5.4 million in the fourth quarter and $34.5 million in fiscal 2010.”
Mr. Bergren concluded, “Looking ahead, I am excited about 2011. Over the past three years, we have taken the necessary steps to navigate the Company through a challenging economic period.
"In 2011, we believe we have many opportunities for top-line growth and increased profitability by tailoring our merchandise assortments to our markets, furthering private brand development and growing eCommerce, as well as optimizing advertising through emerging media channels. All our initiatives underscore our goal of being the provider of fashion and quality at great value.”
Guidance
Keith Plowman, Executive Vice President and Chief Financial Officer, stated, “As noted in the Company's February 3, 2011 press release, with excess borrowing capacity under our revolving credit facility of approximately $472 million at the end of fiscal 2010, the Company paid in full its $75 million second lien term loan on January 31, 2011.”
Mr. Plowman continued, “Further addressing the debt structure of Bon-Ton, we are pleased to announce we have commitments to amend and restate our credit facility agreement for a five-year period, subject to customary closing conditions. The terms, which will be disclosed when the facility closes, provide for more advantageous interest rates and fees, and generally more favorable terms to the Company.”
“Our fiscal 2011 guidance for EBITDA is a range of $235 million to $255 million and for income per diluted share a range of $1.00 to $1.50,” added Mr. Plowman. “Additionally, our estimate for cash flow is a range of $45 million to $60 million, which, we believe, will permit us to manage and reduce our debt levels. Assumptions reflected in our full-year guidance include the following:
• Comparable store sales in a range of 1.5% to 3.5% increase;
• Gross margin rate flat to down 30 basis points to fiscal 2010;
• SG&A expense as a percent to sales flat to fiscal 2010;
• Effective tax rate of 38%;
• Capital expenditures not to exceed $80 million, net of external contributions; and
• Estimated 19.5 million to 20.0 million average shares outstanding.”
Click here for more details
Bon-Ton Stores Inc
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