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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the quarterly period ended July 31, 2002
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OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _________________________ to ____________________
Commission File Number 0-12188
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DEB SHOPS, INC.
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(Exact name of registrant as specified in its charter)
Pennsylvania 23-1913593
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9401 Blue Grass Road, Philadelphia, Pennsylvania 19114
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(Address of principal executive offices) (Zip Code)
(215) 676-6000
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name and address and former fiscal year, if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes __X__ No ________
Indicate the number of shares outstanding of each of the issuer's classes of
Common Stock, as of the latest practicable date.
Common Stock, Par Value $.01 13,684,900
- ---------------------------- ------------------------------------
(Class) (Outstanding at July 31, 2002)
DEB SHOPS, INC. AND SUBSIDIARIES
I N D E X
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Page
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PART I. Item 1. Financial Information:
Consolidated Balance Sheets - 1
July 31, 2002 and January 31, 2002
Consolidated Statements of Operations - Six Months and 2
Three Months Ended July 31, 2002 and 2001
Consolidated Statements of Cash Flows - 3
Six Months Ended July 31, 2002 and July 31, 2001
Notes to Consolidated Financial Statements - 4
July 31, 2002
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations - July 31, 2002 5 - 9
Item 3. Quantitative and Qualitative Disclosures About 9
Market Risk
Item 4. Control And Procedures 9
PART II. Other Information 9
DEB SHOPS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
JULY 31, JANUARY 31,
2002 2002
- ---------------------------------------------------------------------------------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $141,438,946 $135,251,663
Merchandise inventories 37,156,190 31,041,713
Prepaid expenses and other 2,877,901 2,863,473
Deferred income taxes 1,511,916 1,240,047
------------ ------------
Total Current Assets 182,984,953 170,396,896
------------ ------------
PROPERTY, PLANT AND EQUIPMENT, at cost
Land 150,000 150,000
Buildings 4,347,697 4,347,697
Leasehold improvements 40,524,141 39,058,583
Furniture and equipment 17,109,353 17,025,868
------------ ------------
62,131,191 60,582,148
------------ ------------
Less accumulated depreciation
and amortization 42,738,012 41,554,322
------------ ------------
19,393,179 19,027,826
------------ ------------
OTHER ASSETS
Deferred income taxes 4,371,199 4,306,068
Other 1,962,223 2,212,223
------------ ------------
Total Other Assets 6,333,422 6,518,291
------------ ------------
$208,711,554 $195,943,013
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Trade accounts payable $ 30,695,265 $ 24,222,316
Accrued expenses 10,293,035 9,417,972
Income taxes payable 1,899,120 4,344,448
------------ ------------
Total Current Liabilities 42,887,420 37,984,736
------------ ------------
Shareholders' Equity
Series A Preferred Stock, par value $1.00
a share:
Authorized - 5,000,000 shares
Issued and outstanding - 460 shares,
liquidation value $460,000 460 460
Common Stock, par value $.01 a share:
Authorized - 50,000,000 shares
Issued Shares - 15,688,290 156,883 156,883
Additional paid in capital 5,864,790 5,864,790
Retained earnings 172,226,721 164,732,974
------------ ------------
178,248,854 170,755,107
Less common treasury shares, at cost -
July 31, 2002: 2,003,390;
January 31, 2002: 2,063,390 12,424,720 12,796,830
------------ ------------
165,824,134 157,958,277
------------ ------------
$208,711,554 $195,943,013
============ ============
See notes to consolidated financial statements.
-1-
DEB SHOPS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Six Months Ended July 31, Three Months Ended July 31,
-------------------------------------- -------------------------------
2002 2001 2002 2001
---- ---- ---- ----
Revenues
Net Sales $153,646,984 $142,501,634 $76,682,641 $72,490,146
------------ ------------ ----------- -----------
Costs and Expenses
Cost of sales, including
buying and occupancy costs 103,435,083 98,619,793 47,806,551 47,523,095
Selling and administrative 32,504,041 30,404,759 16,751,951 15,906,280
Depreciation and amortization 1,854,050 1,942,684 931,587 974,889
------------ ------------ ----------- -----------
137,793,174 130,967,236 65,490,089 64,404,264
------------ ------------ ----------- -----------
Operating Income 15,853,810 11,534,398 11,192,552 8,085,882
Other income, Principally Interest 1,028,615 2,483,187 435,775 1,177,643
------------ ------------ ----------- -----------
Income Before Income Taxes 16,882,425 14,017,585 11,628,327 9,263,525
Income Taxes 6,330,000 5,256,000 4,360,000 3,476,000
------------ ------------ ----------- -----------
Net Income $ 10,552,425 $ 8,761,585 $ 7,268,327 $ 5,787,525
============ ============ =========== ===========
Net Income Per Common Share
Basic $ 0.77 $ 0.65 $ 0.53 $ 0.43
============ ============ =========== ===========
Diluted $ 0.76 $ 0.64 $ 0.52 $ 0.42
============ ============ =========== ===========
Cash Dividend Declared
Per Common Share $ 0.225 $ 0.175 $ 0.150 $ 0.125
============ ============ =========== ===========
Weighted Average Number of
Common Shares Outstanding
Basic 13,659,247 13,531,292 13,684,900 13,554,900
============ ============ =========== ===========
Diluted 13,898,471 13,626,090 13,991,950 13,640,668
============ ============ =========== ===========
See notes to consolidated financial statements.
-2-
DEB SHOPS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended July 31,
-------------------------------------
2002 2001
---- ----
Cash flows provided by operating activities:
Net income $ 10,552,425 $ 8,761,585
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 1,854,050 1,942,684
Deferred income tax (benefit) (337,000) (200,000)
Loss on retirement of property, plant and equipment 37,392 62,094
Change in operating assets and liabilities:
(Increase) in merchandise inventories (6,114,477) (6,656,849)
(Increase) decrease in prepaid expenses and other (14,428) 403,114
Increase in trade accounts payable 6,472,949 5,940,539
Increase (decrease) in accrued expenses 395,449 (1,269,739)
(Decrease) in income taxes payable (2,445,328) (1,322,708)
------------ ------------
Net cash provided by operating activities 10,401,032 7,660,720
------------ ------------
Cash flows (used in) investing activities:
Purchase of property, plant and equipment, net (2,256,795) (2,762,691)
------------ ------------
Net cash (used in) investing activities (2,256,795) (2,762,691)
------------ ------------
Cash flows (used in) financing activities:
Preferred stock cash dividends paid (27,600) (27,600)
Common stock cash dividends paid (2,048,237) (1,351,240)
Proceeds from exercise of stock options 420,000 585,000
Principal payments under capital lease obligations (301,117) (219,700)
------------ ------------
Net cash (used in) financing activities (1,956,954) (1,013,540)
------------ ------------
Increase in cash and cash equivalents 6,187,283 3,884,489
Cash and cash equivalents at beginning of period 135,251,663 111,648,544
------------ ------------
Cash and cash equivalents at end of period $141,438,946 $115,533,033
============ ============
Supplemental disclosures of cash flow information: Cash paid during the period
for:
Income taxes, net $ 9,112,328 $ 6,578,708
See notes to consolidated financial statements.
-3-
DEB SHOPS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
JULY 31, 2002
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been prepared
in accordance with accounting principles generally accepted in the United States
for interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by accounting principles generally accepted
in the United States for complete financial statements. In the first quarter and
the third quarter cost of goods sold and inventories are estimated based on the
use of the gross profit method. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the three and six months
ended July 31, 2002 are not necessarily indicative of the results that may be
expected for the fiscal year ending January 31, 2003. The Balance Sheet at
January 31, 2002 has been derived from the audited financial statements at that
date. For further information, refer to the consolidated financial statements
and footnotes thereto included in the Company's Annual Report on Form 10-K for
the fiscal year ended January 31, 2002.
Certain prior year amounts have been reclassified to conform with the current
year presentation.
NOTE B - NET INCOME PER SHARE
The table below sets forth the reconciliation of the numerators and
denominators of the basic and diluted net income per common share computations.
Six Months Ended July 31, Three Months Ended July 31,
------------------------- ----------------------------
2002 2001 2002 2001
----------- ----------- ----------- -----------
Net income $10,552,425 $ 8,761,585 $ 7,268,327 $ 5,787,525
Dividends on preferred stock (27,600) (27,600) (13,800) (13,800)
----------- ----------- ----------- -----------
Income available to
common shareholders $10,524,825 $ 8,733,985 $ 7,254,527 $ 5,773,725
=========== =========== =========== ===========
Basic weighted average
number of common
shares outstanding 13,659,247 13,531,292 13,684,900 13,554,900
Effect of dilutive stock options 239,224 94,798 307,050 85,768
----------- ----------- ----------- -----------
Diluted weighted average
number of common
shares outstanding 13,898,471 13,626,090 13,991,950 13,640,668
=========== =========== =========== ===========
-4-
Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Forward-Looking Statements
Deb Shops, Inc. (the "Company") has made in this report, and from time
to time may otherwise make, "forward-looking statements" (as that term is
defined under federal securities laws) concerning the Company's future
operations, performance, profitability, revenues, expenses and financial
condition. This report includes, in particular, forward-looking statements
regarding store openings, closings and other matters. Such forward-looking
statements are subject to various risks and uncertainties. Actual results could
differ materially from those currently anticipated due to a number of factors.
Such factors may include, but are not limited to, the Company's ability to
improve margins, respond to changes in fashion, and the Company's ability to
attract and retain key management personnel. Such factors may also include other
risks and uncertainties detailed in the Company's filings with the Securities
and Exchange Commission, including the Company's Annual Report on Form 10-K for
the fiscal year ended January 31, 2002.
Overview
The Company operates 312 women's specialty apparel retail stores
offering moderately priced, fashionable, coordinated sportswear, dresses, coats,
lingerie, accessories and shoes for junior and plus sized women. The Company
also operates six Tops `N Bottoms stores which sell moderately priced men's and
women's apparel.
Effective September 30, 2001, the Company sold the stock of its
subsidiary, Books Management, Inc. ("BMI"). As a result of the transaction, the
Company recorded a nonrecurring pretax loss of $7,381,152 ($4,611,152, net of
tax, or a loss per share of ($0.34)) in the quarter ended October 31, 2001. For
the six months ended July 31, 2001, BMI had net sales of $8,108,000 and
operating income of $244,000. For the three months ended July 31, 2001, BMI had
net sales of $5,127,000 and operating income of $390,000.
Results of operations for the three and six months ended July 31, 2002
and July 31, 2001 are discussed below on a consolidated basis and separately for
the "Apparel Business" to provide relevant information concerning the Company's
retail apparel store business.
Results of Operations - Consolidated
Consolidated net sales increased $11,145,000 (7.8%) to $153,647,000 in
the six months ended July 31, 2002 from $142,502,000 in the six months ended
July 31, 2001, and increased $11,498,000 (8.8%) in the six months ended July 31,
2001 from the six months ended July 31, 2000. Consolidated net sales increased
$4,192,000 (5.8%) to $76,683,000 in the three months ended July 31, 2002 from
$72,490,000 in the three months ended July 31, 2001 and increased $6,471,000
(9.8%) in the three months ended July 31, 2001 from the three months ended July
31, 2000. The increases in the three and six month periods ended July 31, 2002
and July 31, 2001 were primarily the result of increased apparel store sales.
-5-
The changes in net sales, cost of sales, selling and administrative
expense and net income are more fully described in the section on "Apparel
Business" that follows.
Other income, principally interest, decreased ($1,455,000) (58.6%) to
$1,029,000 in the six months ended July 31, 2002 from $2,483,000 in the six
months ended July 31, 2001 and decreased ($52,000) (2.2%) in the six months
ended July 31, 2001 from the six months ended July 31, 2000. Other income,
principally interest, decreased ($742,000) (63.0%) to $436,000 in the three
months ended July 31, 2002 from $1,178,000 in the three months ended July 31,
2001 and decreased ($226,000) (16.1%) in the three months ended July 31, 2001
from the three months ended July 31, 2000. Interest income is offset by losses
on the disposition of fixed assets. The decreases in the six and three months
ended July 31, 2002 were primarily the result of lower interest rates offset by
earnings on higher cash balances. The decreases during the six and three months
ended July 31, 2001 were primarily the result of gradually declining interest
rates and, to a lesser extent, decreased write-offs from the disposition of
fixed assets.
Income before income taxes increased $2,865,000 (20.4%) to $16,882,000
in the six months ended July 31, 2002 from $14,018,000 in the six months ended
July 31, 2001 and increased $2,510,000 (21.8%) in the six months ended July 31,
2001 from the six months ended July 31, 2000. Income before income taxes
increased $2,365,000 (25.5%) to $11,628,000 in the three months ended July 31,
2002 from $9,264,000 in the three months ended July 31, 2001 and increased
$2,002,000) (27.6%) in the three months ended July 31, 2001 from the three
months ended July 31, 2000. The increases for the six and three months ended
July 31, 2002 and July 31, 2001 were primarily the result of increased sales and
margins in the apparel business.
Results of Operations - Apparel Business
Net sales increased $19,253,000 (14.3%) to $153,647,000 in the six
months ended July 31, 2002 from $134,394,000 in the six months ended July 31,
2001 and increased $11,453,000 (9.3%) in the six months ended July 31, 2001 from
the six months ended July 31, 2000. Net sales increased $9,319,000 (13.8%) to
$76,683,000 in the three months ended July 31, 2002 from $67,363,000 in the
three months ended July 31, 2001 and increased $6,415,000 (10.5%) in the three
months ended July 31, 2001 from the three months ended July 31, 2000. The
increases in net sales for the six and three months ended July 31, 2002 and July
31, 2001 resulted primarily from increased customer acceptance of the Company's
products, which is attributable to the Company's continual refining of its focus
on its younger customers.
-6-
The following table sets forth certain store information:
Six Months Three Months
Ended July 31,(1) Ended July 31,(1)
--------------------- ----------------------
2002 2001 2002 2001
---- ---- ---- ----
Stores open at end of the period 318 295 318 295
Average number in operation during the period 314 295 318 295
Average net sales per store (in thousands) $489 $456 $241 $228
Average operating income per store (in thousands) $ 51 $ 38 $ 35 $ 26
Comparable Store Sales(2)- Percent Change 5.5% 4.7% 4.8% 6.1%
Cost of sales, including buying and occupancy costs, increased
$10,698,000 (11.5%) to $103,427,000 in the six months ended July 31, 2002 from
$92,728,000 in the six months ended July 31, 2001 and increased $6,356,000
(7.4%) in the six months ended July 31, 2001 from the six months ended July 31,
2000. Cost of sales, including buying and occupancy costs, increased $3,943,000
(9.0%) to $47,801,000 in the three months ended July 31, 2002 from $43,859,000
in the three months ended July 31, 2001 and increased $2,700,000 (6.6%) in the
three months ended July 31, 2001 from the three months ended July 31, 2000. The
increases in cost of sales, including buying and occupancy costs, in the six and
three months ended July 31, 2002 and July 31, 2001 were principally due to the
increases in sales during the periods. As a percentage of net sales, these costs
were 67.3% and 69.0% during the six months ended July 31, 2002 and 2001,
respectively, and 62.3% and 65.1% during the three months ended July 31, 2002
and 2001, respectively. The percentage decreases for the six and three months
ended July 31, 2002 as compared to the six and three months ended July 31, 2001,
resulted primarily from increased margins. Buying and occupancy costs were 16.1%
and 16.4% of net sales for the six months ended July 31, 2002 and 2001,
respectively, and 16.4% and 16.5% of net sales for the three months ended July
31, 2002 and 2001, respectively. The percentage decreases for the six and three
months ended July 31, 2002 as compared to the six and three months ended July
31, 2001, resulted principally from an increase in sales during the periods.
Selling and administrative expenses increased $3,840,000 (13.4%) to
$32,494,000 in the six months ended July 31, 2002 from $28,653,000 in the six
months ended July 31, 2001 and increased $2,630,000 (10.1%) in the six months
ended July 31, 2001 from the six months ended July 31, 2000. Selling and
administrative expenses increased $1,810,000 (12.1%) to $16,746,000 in the three
months ended July 31, 2002 from $14,936,000 in the three months ended July 31,
2001 and increased $1,557,000 (11.6%) in the three months ended July 31, 2001
from the three months ended July 31, 2000. The increase in selling and
administrative costs for the six and three months ended July 31, 2002 and 2001
was primarily due to increased store operating costs. As a percentage of net
sales, these expenses were 21.1% and 21.3% in the six months ended July 31, 2002
and 2001, respectively, and 21.8% and 22.2% in the three months ended July 31,
2002 and 2001, respectively. The percentage changes in the three and six month
periods ended July 31, 2002 as compared to the three and six month periods ended
July 31, 2001 were not significant.
- --------
1 Includes Tops `N Bottoms stores.
2 Comparable store sales include stores open for both periods in the current
format and location. A store is added to the comparable store base in its 13th
month of operation.
-7-
Depreciation expense increased $164,000 to $1,825,000 in the six months
ended July 31, 2002 from $1,661,000 in the six months ended July 31, 2001 and
decreased ($274,000) in the six months ended July 31, 2001 from the six months
ended July 31, 2000. Depreciation expense increased $83,000 to $917,000 in the
three months ended July 31, 2002 from $834,000 in the three months ended July
31, 2001 and decreased ($182,000) in the three months ended July 31, 2001 from
the three months ended July 31, 2000. The increases for the six and three months
ended July 31, 2002 were primarily attributable to new store openings and
remodeling of existing stores. The decreases for the six and three months ended
July 31, 2001 were primarily attributable to a revision in the estimated lives
of warehouse assets.
Operating income was $15,902,000 in the six months ended July 31, 2002
as compared to operating income of $11,351,000 in the six months ended July 31,
2001 and $8,611,000 in the six months ended July 31, 2000. Operating income was
$11,219,000 in the three months ended July 31, 2002 as compared to operating
income of $7,735,000 in the three months ended July 31, 2001 and $5,395,000 in
the three months ended July 31, 2000. As a percentage of sales, operating income
was 10.3% and 8.4% in the six months ended July 31, 2002 and 2001, respectively,
and 14.6% and 11.5% in the three months ended July 31, 2002 and 2001,
respectively. The increases in operating income for the six and three months
ended July 31, 2002 and July 31, 2001 were primarily attributable to the
increases in sales and margins, partially offset by increases in selling and
administrative expenses.
Liquidity and Capital Resources - Consolidated
During the six months ended July 31, 2002 and 2001, the Company funded
internally all of its operating needs, including capital expenditures for the
opening of new apparel stores and for the remodeling of existing apparel stores.
Total cash provided by operating activities for the six months ended July 31,
2002 and 2001 was $10,401,000 and $7,661,000, respectively. For the six months
ended July 31, 2002 and 2001, cash provided by operations was the result of net
income, increases in trade accounts payable, and non-cash charges for
depreciation and amortization partially offset by increases in merchandise
inventories and decreases in income taxes payable. The inventory turnover rate
for the apparel business was approximately 1.5 times during the six months ended
July 31, 2002 and 1.5 times during the six months ended July 31, 2001.
Net cash used in investing activities was $2,257,000 and $2,763,000 for
the six months ended July 31, 2002 and 2001, respectively. For the six months
ended July 31, 2002 and 2001, these funds were principally used for the opening
of new stores and the remodeling of existing stores.
Net cash used in financing activities was $1,957,000 and $1,014,000 for
the six months ended July 31, 2002 and 2001, respectively. For the six months
ended July 31, 2002 and 2001, these funds were principally used for the payment
of dividends on preferred and common stock, partially offset by proceeds from
stock options exercised.
As of July 31, 2002 the Company had cash and cash equivalents of
$141,439,000 compared with $115,533,000 at July 31, 2001.
-8-
On May 30, 2002, the Company announced a special dividend of $0.05 per
share on its common stock, and an increase to its existing quarterly dividend
from $0.075 to $0.10 per share of common stock. On May 16, 2001, the Company
also announced a special dividend of $0.05 per share on its common stock, and
increased its existing quarterly dividend from $0.05 to $0.075 per share of
common stock. The Company believes that, despite these dividend increases,
internally generated funds will be sufficient to meet its anticipated capital
expenditures, none of which are material, and current operating needs.
Item 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
As of July 31, 2002, the Company had cash and cash equivalents of
$141,439,000 compared to $115,533,000 as of July 31, 2001, and $92,663,000 as of
July 31, 2000. These funds are invested primarily in money market funds and
short-term municipal bonds, all of which are fully insured or guaranteed by
letters-of-credit. The Company does not invest for trading purposes.
Accordingly, the Company does not believe it has significant exposure to market
risk with respect to its investments.
Item 4.
CONTROL AND PROCEDURES
There were no significant changes in the Company's internal controls or
in other factors that could significantly affect those controls subsequent to
the beginning of the current fiscal year, including any corrective actions with
regard to significant deficiencies and material weaknesses.
PART II. OTHER INFORMATION
Items 1 - 3. NOT APPLICABLE
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS:
The annual meeting of the Company was held on Thursday, May
30, 2002. Total votes present either in person or by proxy were 13,267,051.
Votes were cast as follows for the election of directors:
FOR WITHHELD
---------- --------
Marvin Rounick 12,410,752 856,299
Warren Weiner 12,410,752 856,299
Jack A. Rounick 12,627,552 639,499
Barry H. Feinberg 12,627,552 639,499
Barry H. Frank 12,609,052 657,999
Ivan Inerfeld 12,327,586 939,465
-9-
Votes were cast as follows for the Approval of the adoption of
the Deb Shops, Inc. Incentive Stock Option Plan As Amended And Restated
Effective January 1, 2002:
FOR 11,251,506
AGAINST 797,700
ABSTAIN 222,606
There were no other matters voted on at the meeting.
Item 5. NOT APPLICABLE
Item 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
Exhibit 99.1* Certification of Marvin Rounick
pursuant to section 906 of the Sarbanes-Oxley Act of
2002
Exhibit 99.2* Certification of Lewis Lyons pursuant
to section 906 of the Sarbanes-Oxley Act of 2002
* Filed electronically herewith
(b) Reports on Form 8-K
No reports on Form 8-K were filed by the Company
during the quarter ended July 31, 2002.
-10-
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
DEB SHOPS, INC.
DATE: September 13, 2002 By /s/ Marvin Rounick
---------------------------
Marvin Rounick
President and Chief
Executive Officer
DATE: September 13, 2002 By /s/ Lewis Lyons
---------------------------
Lewis Lyons
Vice President, Finance
Chief Financial Officer
CERTIFICATION
I, Marvin Rounick, President and Chief Executive Officer of Deb Shops, Inc.,
certify that:
1. I have reviewed this quarterly report on Form 10-Q of Deb Shops, Inc.;
2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this quarterly report;
Dated: September 13, 2002 By: /s/ Marvin Rounick
-----------------------------------------
Marvin Rounick
President and Chief Executive Officer
I, Lewis Lyons, Chief Financial Officer of Deb Shops, Inc., certify that:
1. I have reviewed this quarterly report on Form 10-Q of Deb Shops, Inc.;
2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the registrant as of, and for, the periods presented in
this quarterly report;
Dated: September 13, 2002 By: /s/ Lewis Lyons
----------------------------------
Lewis Lyons
Chief Financial Officer