Brookstone Announces Third Quarter and Year-to-Date 2009 Financial Results
For the 13-week period ended October 3, 2009, Brookstone reported total net sales of $68.2 million, a 23.8% decrease from the comparable 13-week period of 2008. Same-store sales decreased 16.7% as compared to the comparable 13-week period last year.
For the 13-week period ended October 3, 2009, Brookstone reported a loss from operations of $13.0 million, compared to a loss from operations of $10.5 million for the comparable 13-week period last year.
For the 39-week period ended October 3, 2009, Brookstone reported total net sales of $202.6 million, a 26.8% decrease from the comparable 39-week period of 2008. Same-store sales decreased 20.1% as compared to the comparable 39-week period last year.
For the 39-week period ended October 3, 2009, Brookstone reported a loss from operations of $44.2 million, compared to a loss from operations of $31.2 million for the comparable 39-week period last year.
Ron Boire, Brookstone President and Chief Executive Officer, said, "Same-store sales for the third quarter, while negative, continued to show quarter over quarter improvement. October same- store sales were, in fact, positive, driven by many successful new product introductions. We have seen an increase in both transactions and average ticket since the end of the third quarter."
Mr. Boire continued, "At the beginning of the year, we responded to the economic environment and declining mall traffic by identifying over $30 million in annualized cost reductions, and reducing both capital expenditures and working capital requirements. I am pleased to report that year to date, we are on track to meet, if not exceed, our cost reduction goals. Additionally, we managed down our inventory levels by 34% during the third quarter as compared to last year. As a result of successfully restructuring our operations, Brookstone ended the third quarter with an encouraging liquidity position, as our short term net borrowings were $4.0 million lower than last year."
Mr. Boire concluded, "We believe that we are very well positioned for the fourth quarter in terms of product assortment and inventory levels, and are looking forward to a successful holiday season."
About Brookstone:
Brookstone, Inc. is an innovative product development and specialty lifestyle retail company that operates 308 Brookstone Brand stores nationwide and in Puerto Rico. Typically located in high-traffic regional shopping malls and airports, the stores feature unique and innovative consumer products. The Company also operates a Direct Marketing business that includes the Brookstone catalog and an e-commerce website at www.brookstone.com.
Brookstone is principally owned by three sponsors, Osim International, J.W. Childs, and Temasek Holdings. In accordance with the terms governing its publicly-held debt, the Company issues quarterly and annual reports under SEC guidelines.
Statements in this release which are not historical facts, including statements about the Company's confidence or expectations, earnings, anticipated operations of its e-commerce sites and those of third-party service providers, and other statements about the Company's operational outlook are forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 ("Reform Act") and are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in such forward-looking statements. Such risks and uncertainties include, without limitation, risks of changing market conditions in the overall economy and the retail industry, consumer demand, the effectiveness of e-commerce technology and marketing efforts, availability of products, availability of adequate transportation of such products, and other factors detailed from time to time in the Company's annual and other reports posted to the Company's website. Words such as "estimate", "project", "plan", "believe", "feel", "anticipate", "assume", "may", "will", "should" and similar words and phrases may identify forward- looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date thereof. The Company undertakes no obligations to publicly release any revisions to these forward-looking statements or reflect events or circumstances after the date hereof.
BROOKSTONE, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
__ October 3,__ January 3,__ September 27,
__ 2009__ 2009__ 2008
__ (Unaudited)__ (Unaudited)
Assets
------
Current assets:
Cash and cash equivalents__ $1,350__ $22,530__ $1,680
Receivables, net__ 5,806__ 9,839__ 9,811
Merchandise inventories__ 73,025__ 82,095__ 110,919
Deferred income taxes, net__ --- --- 23,429
Prepaid expenses__ 4,032__ 16,379__ 9,749
----- ------ -----
Total current assets__ 84,213__ 130,843__ 155,588
Property, plant and equipment, net__ 58,196__ 66,456__ 72,224
Intangible assets, net__ 105,000__ 105,000__ 129,000
Goodwill__ 99,734__ 99,734__ 189,524
Other assets__ 6,591__ 8,565__ 9,470
----- ----- -----
Total assets__ $353,734__ $410,598__ $555,806
========__ ========__ ========
Liabilities and Shareholder's Equity
------------------------------------
Current liabilities:
Accounts payable__ $16,844__ $17,033__ $24,155
Other current liabilities__ 29,854__ 41,179__ 34,271
Short-term borrowings__ 18,715__ --- 23,050
------ ------
Total current liabilities__ 65,413__ 58,212__ 81,476
Other long-term liabilities__ 21,305__ 21,370__ 19,691
Long-term debt, net of current
portion__ 173,623__ 174,089__ 174,311
Deferred income taxes__ 38,020__ 38,430__ 43,258
------ ------ ------
Total liabilities__ 298,361__ 292,101__ 318,736
Commitments and contingencies__ --- --- ---
Equity:
Brookstone Shareholder's equity:
Common Stock - $0.01 par value,
1,000 shares authorized, one
share issued and outstanding__ --- --- ---
Additional paid-in capital__ 241,747__ 241,205__ 240,996
Accumulated other comprehensive
income (loss)__ (547)__ (532)__ 572
Retained deficit__ (186,495)__ (123,216)__ (5,728)
-------- -------- ------
Total Brookstone Shareholder's
equity__ 54,705__ 117,457__ 235,840
Noncontrolling interests__ 668__ 1,040__ 1,230
--- ----- -----
Total equity__ 55,373__ 118,497__ 237,070
------ ------- -------
Total liabilities and equity__ $353,734__ $410,598__ $555,806
========__ ========__ ========
BROOKSTONE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands) __ (Unaudited)
__ Thirteen weeks__ Thirty-nine weeks
__ ended__ ended
__ October 3,__ September 27,__ October 3,__ September 27,
__ 2009__ 2008__ 2009__ 2008
Net sales__ $68,165__ $89,471__ $202,596__ $276,662
Cost of sales__ 55,675__ 68,614__ 168,953__ 207,506
Gross profit__ 12,490__ 20,857__ 33,643__ 69,156
Selling, general and administrative expenses__ 25,457__ 31,361__ 77,878__ 100,328
Loss from operations__ (12,967)__ (10,504)__ (44,235)__ (31,172)
Interest expense, net__ 6,036__ 6,076__ 18,011__ 17,600
Loss before income taxes__ (19,003)__ (16,580)__ (62,246)__ (48,772)
Income tax provision (benefit)__ 40__ (6,467)__ 604__ (18,902)
Consolidated net loss__ (19,043)__ (10,113)__ (62,850)__ (29,870)
Less: Net income attributable to noncontrolling interests__ 147__ 308__ 429__ 944
Net loss attributable to Brookstone__ $(19,190)__ $(10,421)__ $(63,279)__ $(30,814)
Contact: Philip Roizin
EVP of Finance and Administration
(603) 880-9500
SOURCE: Brookstone, Inc.
Originally published by Brookstone, Inc..
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