* Second quarter net income up 38.4% to a record $49 million
* Revenues rose 31.0% to a record $670 million for the six months
* Six months net income climbed 35.3% to a record $96 million
* August comparable store sales currently in the low double digit range
* Company announces fiscal 2006 store opening plans
FORT MYERS, Fla., Aug. 25 /PRNewswire-FirstCall/ -- Chico's FAS, Inc.
(NYSE: CHS) today announced its financial results for the second quarter and
six months ended July 30, 2005.
(Logo: http://www.newscom.com/cgi-bin/prnh/20030428/CHICOLOGO )
Net sales for the second quarter ended July 30, 2005, increased 34.6% to a
record $343 million from $255 million for the second quarter ended July 31,
2004. Net income rose 38.4% to $49 million, or $0.27 a diluted share,
compared to net income of $35 million, or $0.20 a diluted share (as adjusted
for the 2 for 1 stock split in February 2005) in the prior year's second
quarter. Comparable store sales for the Company-owned stores increased 15.7%
for the thirteen-week period ended July 30, 2005 compared to the same
thirteen-week period last year.
For the six months ended July 30, 2005, net sales increased 31.0% to a
record $670 million from $512 million for the prior year's six months ended
July 31, 2004. Net income rose 35.3% to $96 million, or $0.53 a diluted
share, compared to net income of $71 million, or $0.40 a diluted share (as
adjusted for the 2 for 1 stock split in February 2005) in the prior period.
Comparable store sales for the Company-owned stores increased 13.2% for the
twenty-six week period compared to the same twenty-six week period last year.
The Company also announced that it is planning to open approximately 20%
net new square footage combined for the Chico's and White House | Black Market
brands in fiscal 2006, taking into account approximately 105 to 120 net new
Company-owned stores and increased square footage from 30-40 relocations
and/or expansions. It is currently anticipated that new Chico's and White
House | Black Market stores in 2006, for the most part, will be somewhat
larger than the average existing store size for the respective brand.
Currently, the Company plans that approximately 60% of these new stores will
be Chico's stores, with the balance being White House | Black Market stores.
In addition, the Company also announced that it plans to open 20 new Soma
by Chico's stores during fiscal 2006 over and above the combined 20% net
square footage growth rate outlined above for the Chico's and
White House | Black Market brands. The Company anticipates that additional
investment will be required to establish the Soma by Chico's brand as an
acceptable business meeting the profitability goals of the Company over the
longer term. The Company believes the Soma by Chico's brand reduced the
Company's operating margin by approximately 60 to 70 basis points for the
second quarter of fiscal 2005 and the Company anticipates this will not change
significantly in fiscal 2006 even considering the additional new stores
planned. The Company further believes that an impact on margin of this order
is acceptable when balanced against the possibility of its longer term growth
potential.
Scott A. Edmonds, President and CEO, commented, "The second quarter came
in with very strong results as we generated an operating margin in excess of
22%, a sales increase of 35%, and a net income increase of over 38%. Second
quarter gross margins for the core Chico's brand were somewhat off from last
year's gross margins while White House | Black Market's gross margins were up
270 basis points on a quarter over quarter basis. Looking at the potential
third quarter results, we are pleased with our same store sales trends thus
far in August. Overall, we are experiencing same store sales in the low
double digit range, with the Chico's brand in the high single digits range and
the White House | Black Market brand again experiencing much stronger same
store sales up in the mid 40% range. We are seeing initial strong front-line
gross margins from our Fall lines and we anticipate that Chico's front-line
stores will generate third quarter gross margins in the range of last year's
record setting gross margins and that White House | Black Market's gross
margins will continue to make significant improvement. Despite these
expectations, we are anticipating an overall gross margin decline in the third
quarter similar to that experienced in the second quarter. The lower gross
margin is expected to be principally due to lower gross margins in the outlet
division as it anniversaries its highest gross margins in history from last
year and returns to more normalized outlet gross margins."
The Company is a specialty retailer of private label, sophisticated,
casual-to-dressy clothing, intimates, complementary accessories, and other
non-clothing gift items. The Company operates 713 women's specialty stores,
including stores in 47 states, the District of Columbia, the U.S. Virgin
Islands and Puerto Rico operating under the Chico's, White House | Black
Market and Soma by Chico's names. The Company owns 477 Chico's front-line
stores, 27 Chico's outlet stores, 181 White House | Black Market front-line
stores, 5 White House | Black Market outlet stores and 10 Soma by Chico's
stores; franchisees own and operate 13 Chico's stores.
Certain statements contained herein, including without limitation,
statements addressing the beliefs, plans, objectives, estimates or
expectations of the Company or future results or events constitute
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995, as amended. Such forward-looking statements
involve known or unknown risks, including, but not limited to, general
economic and business conditions, and conditions in the specialty retail
industry. There can be no assurance that the actual future results,
performance, or achievements expressed or implied by such forward-looking
statements will occur. Users of forward-looking statements are encouraged to
review the Company's latest annual report on Form 10-K, its filings on Form
10-Q, management's discussion and analysis in the Company's latest annual
report to stockholders, the Company's filings on Form 8-K, and other federal
securities law filings for a description of other important factors that may
affect the Company's business, results of operations and financial condition.
The Company does not undertake to publicly update or revise its
forward-looking statements even if experience or future changes make it clear
that projected results expressed or implied in such statements will not be
realized.
For more detailed information, please call (877) 424-4267 to listen to the
Company's monthly sales information and investor relations line
A copy of a slide show addressing the Company's recent financial results and
current plans for expansion is available on the Company's website at
http://www.chicos.com in the investor relations section
Additional investor information on Chico's FAS, Inc. is available free of
charge on the Company's website at http://www.chicos.com in the investor
relations section
(Financial Tables Follow)
Chico's FAS, Inc.
Consolidated Balance Sheets
(in thousands)
July 30, January 29,
2005 2005
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $15,741 $14,426
Marketable securities, at market 334,815 251,199
Receivables 6,744 5,106
Inventories 79,153 73,223
Prepaid expenses 14,614 9,429
Deferred taxes 13,981 11,184
Total Current Assets 465,048 364,567
Property and Equipment:
Land and land improvements 6,264 6,055
Building and building improvements 32,300 29,286
Equipment, furniture and fixtures 161,275 140,360
Leasehold improvements 184,714 166,096
Total Property and Equipment 384,553 341,797
Less accumulated depreciation and
amortization (113,667) (93,834)
Property and Equipment, Net 270,886 247,963
Other Assets:
Goodwill 61,796 61,796
Other intangible assets 34,087 34,042
Other assets, net 18,019 7,361
Total Other Assets 113,902 103,199
$849,836 $715,729
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $38,230 $36,725
Accrued liabilities 69,688 58,258
Current portion of deferred liabilities 433 332
Total Current Liabilities 108,351 95,315
Noncurrent Liabilities:
Deferred liabilities 52,850 47,149
Deferred taxes 6,363 12,397
Total Noncurrent Liabilities 59,213 59,546
Stockholders' Equity:
Common stock 1,807 1,790
Additional paid-in capital 176,882 147,652
Unearned compensation (4,045) -
Retained earnings 507,867 411,556
Accumulated other comprehensive loss (239) (130)
Total Stockholders' Equity 682,272 560,868
$849,836 $715,729
Chico's FAS, Inc.
Consolidated Statements of Income
(Unaudited)
(in thousands, except per share amounts)
Twenty-Six Weeks Ended Thirteen Weeks Ended
July 30, 2005 July 31, 2004 July 30, 2005 July 31, 2004
Amount % of Amount % of Amount % of Amount % of
Sales Sales Sales Sales
Net sales
by
Chico's/
Soma
stores $539,071 80.4 $432,341 84.5 $271,466 79.2 $213,852 83.9
Net sales
by White
House |
Black
Market
stores 111,095 16.6 62,825 12.3 61,932 18.1 32,827 12.9
Net sales
by catalog
& Internet 14,992 2.2 12,412 2.4 7,035 2.0 6,330 2.5
Net sales to
franchisees 5,022 0.8 3,980 0.8 2,492 0.7 1,758 0.7
Net sales 670,180 100.0 511,558 100.0 342,925 100.0 254,767 100.0
Cost of
goods sold 261,627 39.0 195,037 38.1 136,429 39.8 98,082 38.5
Gross
profit 408,553 61.0 316,521 61.9 206,496 60.2 156,685 61.5
General,
administrative
and store
operating
expenses 239,330 35.7 188,799 36.9 120,056 35.0 92,994 36.5
Depreciation
and
amortization 19,853 3.0 13,701 2.7 10,482 3.0 6,924 2.7
Income
from
operations 149,370 22.3 114,021 22.3 75,958 22.2 56,767 22.3
Interest
income,
net 3,504 0.5 753 0.1 1,994 0.6 484 0.2
Income
before
taxes 152,874 22.8 114,774 22.4 77,952 22.7 57,251 22.5
Income tax
provision 56,563 8.4 43,613 8.5 28,841 8.4 21,755 8.6
Net income $96,311 14.4 $71,161 13.9 $49,111 14.3 $35,496 13.9
Per share data:
Net income
per common
share-
basic(1) $0.54 $0.40 $0.27 $0.20
Net income
per common
& common
equivalent
share-
diluted(1) $0.53 $0.40 $0.27 $0.20
Weighted
average
common
shares
outstanding-
basic(1) 180,007 177,756 180,410 178,572
Weighted
average
common &
common
equivalent
shares
outstanding-
diluted(1) 181,867 179,967 182,292 180,379
(1) Prior year amounts restated to give effect to the 2 for 1 stock
split in February 2005
SOURCE Chico's FAS, Inc.
-0- 08/25/2005
/CONTACT: Charles J. Kleman, Chief Financial Officer, Chico's FAS, Inc.,
+1-239-274-4105, or F. Michael Smith, Vice President, Investor and Community
Relations, Chico's FAS, Inc., +1-239-274-4797/
/Photo: NewsCom: http://www.newscom.com/cgi-bin/prnh/20030428/CHICOLOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, photodesk@prnewswire.com /
/Web site: http://www.chicos.com /
(CHS)
CO: Chico's FAS, Inc.
ST: Florida
IN: REA
SU: ERN
KJ
-- NYTH100 --
8649 08/25/2005 16:05 EDT http://www.prnewswire.com