Retailer Saks sales up 5.6% in Q4 FY'13

Sales for the Fourth Quarter and Fiscal Year Ended February 2, 2013

The fiscal year 2012 period includes an extra week, creating a 53-week fiscal year that occurs every six years in the accounting cycle for many retailers. For fiscal 2012, the fourth quarter and fiscal year periods ended February 2, 2013 and included 14 weeks and 53 weeks, respectively. For the prior year, the fourth quarter and fiscal year periods ended January 28, 2012 and included 13 weeks and 52 weeks, respectively.

For the 14 weeks and 53 weeks ended February 2, 2013 compared to the 13 and 52 weeks ended January 28, 2012, respectively, total sales increased 5.6% for the fourth quarter and 4.4% for the full year.

Comparable store sales numbers below do not include the additional week and are based on comparisons of the 13 weeks and 52 weeks ended January 26, 2013 to the prior year comparable periods. For the 13 weeks ended January 26, 2013 compared to the 13 weeks ended January 28, 2012, fourth quarter total sales increased 1.0%, and comparable store sales increased 0.7%. For the 52 weeks ended January 26, 2013 compared to the 52 weeks ended January 28, 2012, total sales increased 3.1% and comparable store sales increased 3.2%.

Overview of Results for the Fourth Quarter Ended February 2, 2013

For the fourth quarter ended February 2, 2013, the Company recorded net income of $20.4 million, or $.13 per diluted share. Those results included net after-tax charges of $8.0 million, or $.04 per share, comprised of:

-$3.2 million of asset impairment charges,

-$1.0 million of store closing expenses,

-a $1.7 million non-cash pension settlement charge related to the payment of excess lump-sum distributions,

-A $2.1 million loss on debt extinguishment related to the early retirement and conversion to equity of approximately $28.8 million (par value) of the Company’s 7.5% convertible debt.

Excluding these items, the Company would have recorded net income of $28.4 million, or $.17 per diluted share, for the fourth quarter ended February 2, 2013.

For last year’s fourth quarter ended January 28, 2012, the Company recorded net income of $37.0 million, or $.21 per diluted share. Those results included a net after-tax gain totaling $8.0 million, or $.04 per share, comprised of:

-$3.9 million of severance and asset impairment charges,

-$1.1 million of store closing expenses,

-A positive retroactive adjustment (from April 15, 2011 to October 29, 2011) of $3.1 million as provided in the risk and revenue sharing provisions of the November 2011 amendment of the Company’s credit card program agreement with HSBC

-The reversal of approximately $9.9 million in state estimated income tax reserves deemed no longer necessary.

Excluding this net after-tax gain, the Company would have recorded net income of $29.0 million, or $.17 per diluted share, for the fourth quarter ended January 28, 2012.

Based on existing debt arrangements and interest rates, interest expense should approximate $34 million to $35 million for the full fiscal year.

Saks Incorporated