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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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 April 30, 2004
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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
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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 by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
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 13,706,900
- ---------------------------- ------------------------------------
(Class) (Outstanding at June 6, 2004)
DEB SHOPS, INC. AND SUBSIDIARIES
I N D E X
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PAGE
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PART I. Financial Information:
Item 1. Financial statements
Consolidated Balance Sheets 1
April 30, 2004 (Unaudited) and January 31, 2004
Consolidated Statements of Operations (Unaudited) 2
Three Months Ended April 30, 2004 and 2003
Consolidated Statements of Cash Flows (Unaudited) 3
Three Months Ended April 30, 2004 and 2003
Notes to Consolidated Financial Statements 4-5
April 30, 2004 (Unaudited)
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations - April 30, 2004 6-9
Item 3. Quantitative and Qualitative Disclosures About
Market Risk 9
Item 4. Controls and Procedures 9
PART II. Other Information 10
DEB SHOPS, INC. & SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
APRIL 30,
2004 JANUARY 31,
(UNAUDITED) 2004
- ------------------------------------------------------------------------------------------------------------------------------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $162,027,492 $166,264,418
Merchandise inventories 24,381,282 28,264,675
Prepaid expenses and other 3,912,899 3,150,882
Deferred income taxes 1,260,191 1,260,191
------------ ------------
Total current assets 191,581,864 198,940,166
PROPERTY, PLANT AND EQUIPMENT - AT COST
Land 150,000 150,000
Buildings 2,365,697 2,365,697
Leasehold improvements 40,501,966 40,566,558
Furniture and equipment 16,867,356 16,656,545
------------ ------------
59,885,019 59,738,800
Less accumulated depreciation and amortization 42,891,704 42,625,923
------------ ------------
Net property, plant and equipment 16,993,315 17,112,877
OTHER ASSETS
Deferred income taxes 4,732,846 4,732,846
Other 1,962,223 1,962,223
------------ ------------
Total other assets 6,695,069 6,695,069
------------ ------------
Total assets
$215,270,248 $222,748,112
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Trade accounts payable $ 21,161,478 $ 26,523,559
Accrued expenses and other 10,417,513 10,649,923
Income taxes payable 452,223 2,010,234
------------ ------------
Total current liabilities 32,031,214 39,183,716
SHAREHOLDERS' EQUITY
Series A Preferred Stock, par value $1.00 per share: Authorized - 5,000,000
shares Issued and outstanding - 460 shares,
liquidation value $460,000 460 460
Common Stock, par value $.01 per share:
Authorized - 50,000,000 shares
Issued - 15,688,290 shares 156,883 156,883
Additional paid in capital 6,254,749 5,864,790
Retained earnings 189,115,222 189,966,983
------------ ------------
195,527,314 195,989,116
Less common treasury shares, at cost:
April 30, 2004 -1,981,390; January 31, 2004 - 2,003,390 12,288,280 12,424,720
------------ ------------
183,239,034 183,564,396
------------ ------------
Total liabilities and shareholders' equity $215,270,248 $222,748,112
============ ============
See notes to consolidated financial statements.
-1-
DEB SHOPS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
THREE MONTHS ENDED APRIL 30,
----------------------------------
2004 2003
----------- -----------
Net sales $73,080,583 $70,161,591
----------- -----------
Costs and expenses:
Cost of sales, including buying
and occupancy costs 53,971,273 52,394,003
Selling and administrative 17,133,968 16,679,097
Depreciation and amortization 986,940 1,038,659
----------- -----------
72,092,181 70,111,759
Operating income 988,402 49,832
Other income, principally interest 389,000 401,142
----------- -----------
Income before income taxes 1,377,402 450,974
Income tax provision 502,000 171,000
----------- -----------
Net income $ 875,402 $ 279,974
=========== ===========
Net income per common share
Basic $ 0.06 $ 0.02
=========== ===========
Diluted $ 0.06 $ 0.02
=========== ===========
Cash dividend declared
per common share $ 0.125 $ 0.100
=========== ===========
Weighted average number of
common shares outstanding
Basic 13,687,389 13,684,900
=========== ===========
Diluted 13,698,505 13,684,900
=========== ===========
See notes to consolidated financial statements.
-2-
DEB SHOPS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
THREE MONTHS ENDED APRIL 30,
---------------------------------------
2004 2003
------------- -------------
Cash flows used in operating activities:
Net income $ 875,402 $ 279,974
Adjustments to reconcile net income to
net cash used in operating activities:
Depreciation and amortization 986,940 1,038,659
Loss on retirement of property, plant and equipment 31,809 12,077
Change in assets and liabilities:
Decrease in merchandise inventories 3,883,393 4,440,082
Increase in prepaid expenses and other (643,267) (1,389,733)
Decrease in trade accounts payable (5,362,081) (1,207,112)
Decrease in accrued expenses and other (235,160) (377,450)
Decrease in income taxes payable (1,554,110) (3,319,533)
------------- -------------
Net cash used in operating activities (2,017,074) (523,036)
------------- -------------
Cash flows used in investing activities:
Purchase of property, plant and equipment, net (899,189) (814,948)
------------- -------------
Net cash used in investing activities (899,189) (814,948)
------------- -------------
Cash flows used in financing activities:
Preferred stock cash dividends paid (13,800) (13,800)
Common stock cash dividends paid (1,710,613) (1,368,490)
Proceeds from exercise of stock options 403,750 -
------------- -------------
Net cash used in financing activities (1,320,663) (1,382,290)
------------- -------------
Decrease in cash and cash equivalents (4,236,926) (2,720,274)
------------- -------------
Cash and cash equivalents at beginning of period 166,264,418 152,617,355
Cash and cash equivalents at end of period $ 162,027,492 $ 149,897,081
============= =============
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Income taxes, net $ 3,078,000 $ 3,473,000
============= =============
See notes to consolidated financial statements.
-3-
DEB SHOPS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
APRIL 30, 2004
- - A - ORGANIZATION / BASIS OF PRESENTATION
Deb Shops, Inc. (the "Company") operates 329 women's and men's
specialty apparel retail stores. The Company operates 320 stores under the name
"DEB" which offer moderately priced, fashionable, coordinated women's
sportswear, dresses, coats, lingerie, accessories and shoes for junior and plus
sizes. In addition, the Company operates three outlet stores under the name
"CSO." The outlet stores offer the same merchandise as DEB at reduced prices and
serve as clearance stores for slow-moving inventory. One hundred and thirty of
the DEB stores contain plus-size departments. The Company also operates six
apparel retail stores under the name "Tops `N Bottoms." The Tops `N Bottoms
stores sell moderately priced men's and women's apparel. Eighteen of the DEB
stores contain Tops `N Bottoms departments. The Company's stores are located in
regional malls and strip shopping centers principally located in the East and
Midwest regions of the United States.
The accompanying unaudited consolidated financial statements have been
prepared in accordance with accounting principles generally accepted in the
United States for interim financial information. 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 and third quarters, 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 months
ended April 30, 2004 are not necessarily indicative of the results that may be
expected for the fiscal year ending January 31, 2005. 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,
2004.
The preparation of the consolidated financial statements in conformity
with accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
- - 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.
THREE MONTHS ENDED APRIL 30,
------------------------------
2004 2003
------------ ------------
Net income $ 875,402 $ 279,974
Dividends on preferred stock (13,800) (13,800)
------------ ------------
Income available to common
shareholders $ 861,602 $ 266,174
============ ============
Basic weighted average number
of common shares outstanding 13,687,389 13,684,900
Effect of dilutive stock options 11,116 -
------------ ------------
Diluted weighted average
number of common
shares outstanding 13,698,505 13,684,900
============ ============
-4-
DEB SHOPS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
APRIL 30, 2004
(CONTINUED)
- - B - NET INCOME PER SHARE (CONTINUED)
During the quarter ended April 30, 2004, the Company issued 22,000
shares as a result of employee stock option exercises. The effect of these
exercises is included in the basic and diluted weighted average number of common
shares outstanding.
Options to purchase 1,264,000 shares of common stock, at a weighted
average exercise price of $23.77 per share, were outstanding at April 30, 2004.
The effect of these options on the diluted weighted average number of common
shares outstanding at April 30, 2004 is reflected in the above table.
Options to purchase 1,381,500 shares of common stock, at a weighted
average exercise price of $23.77 per share, were outstanding during the three
months ended April 30, 2003. These options were not included in the computation
of diluted earnings per share because the exercise price was greater than the
average market price of the common stock during the period and, therefore, the
effect would have been antidilutive.
- -C - INCOME TAXES
The Company's effective tax rate differs from the federal statutory
rate due primarily to state income taxes, offset by tax-exempt interest
earnings.
- - D - STOCK RELATED COMPENSATION
The Company has a stock option plan whereby options may be granted to
employees or non-employee directors on the basis of contributions to the
operations of the Company. Details concerning the plan are described in Note F
to the financial statements included in the Company's Annual Report on Form 10-K
for the fiscal year ended January 31, 2004. The Company continues to use the
accounting method under Accounting Principles Board Opinion No. 25 ("APB No.
25"), "Accounting for Stock Issued to Employees," and related interpretations
for this plan. Under APB No. 25, generally, when the exercise price of the
Company's stock options equals the market price of the underlying stock on the
date of the grant, no compensation expense is recognized.
Had the Company recognized compensation cost for the stock option plan
consistent with the provisions of SFAS No. 123, "Accounting for Stock-Based
Compensation," net income and basic and diluted net income per share would have
been adjusted to the following pro forma amounts.
THREE MONTHS ENDED APRIL 30,
---------------------------
2004 2003
--------- ----------
Net income as reported $ 875,402 $ 279,974
Stock-based employee compensation cost 61,503 699,601
--------- ----------
Pro forma net income (loss) $ 813,899 $ (419,627)
========= ==========
Basic net income per common share, as reported $ 0.06 $ 0.02
Pro forma basic net income (loss)
per common share $ 0.06 $ (0.03)
Diluted net income per common share, as reported $ 0.06 $ 0.02
Pro forma diluted net income (loss)
per common share $ 0.06 $ (0.03)
-5-
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, earnings and
financial condition. This report includes, in particular, forward-looking
statements regarding expectations of future performance, store openings and
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 or maintain
sales and margins, respond to changes in fashion, find suitable retail locations
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
other filings with the Securities and Exchange Commission, including the
Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2004
(the "2004 10-K"). The Company assumes no obligation to update or revise its
forward-looking statements even if experience or future changes make it clear
that any projected results expressed or implied therein will not be realized.
CRITICAL ACCOUNTING POLICIES
The Company's critical accounting policies are discussed in
Management's Discussion and Analysis of Financial Condition and Results of
Operations and notes accompanying the consolidated financial statements that
appear in the 2004 10-K. There were no material changes subsequent to the filing
of the 2004 10-K in the Company's critical accounting policies or in the
assumptions or estimates used to prepare the financial information appearing in
this report.
OVERVIEW
This Management's Discussion and Analysis of Financial Condition and
Results of Operations should be read in conjunction with the financial
statements and accompanying notes appearing elsewhere in this report.
The Company operates 329 women's and men's specialty apparel retail
stores. The Company operates 320 stores under the name "DEB" which offer
moderately priced, fashionable, coordinated women's sportswear, dresses, coats,
lingerie, accessories and shoes for junior and plus sizes. In addition, the
Company operates three outlet stores under the name "CSO." The outlet stores
offer the same merchandise as DEB at reduced prices and serve as clearance
stores for slow-moving inventory. One hundred and thirty of the DEB stores
contain plus-size departments. The Company also operates six apparel retail
stores under the name "Tops `N Bottoms." The Tops `N Bottoms stores sell
moderately priced men's and women's apparel. Eighteen of the DEB stores contain
Tops `N Bottoms departments. The Company's stores are located in regional malls
and strip shopping centers principally located in the East and Midwest regions
of the United States.
The Company's performance during the quarter ended April 30, 2004 (the
"Current Quarter") was highlighted by a 2.4% increase in comparable stores sales
and an improvement in operating efficiencies resulting from this increase. Due
primarily to a reduction in markdowns as a percentage of sales, the Company also
improved gross margins, which when combined with the aforementioned sales
increase, resulted in improved expense leverage and an increase in net income
when compared to the quarter ended April 30, 2003 (the "Comparable Quarter").
-6-
RESULTS OF OPERATIONS
THREE MONTHS ENDED APRIL 30, 2004 COMPARED TO THREE MONTHS ENDED APRIL 30, 2003
NET SALES
Net sales increased 4.2% during the Current Quarter to $73,081,000 from
$70,162,000 in the Comparable Quarter. The $2,919,000 increase was the result of
a 2.4% or $1,703,000 comparable store sales increase, as well as sales from new
stores of $1,216,000. The Company believes that this sales increase is
attributable to improved customer acceptance of the Company's merchandise
offerings as evidenced by increase in unit sales and net sales per transaction
versus the Comparative Quarter.
The following table sets forth certain store information.
STORE DATA(1)
THREE MONTHS ENDED
APRIL 30,
------------------------
2004 2003
---- ----
Stores open at end of the period 329 330
Average number in operation during the period 331 330
Average net sales per store (in thousands) $ 221 $ 213
Average operating income
per store (in thousands) $ 3.0 $ 0.2
Comparable store sales(2) - percent change 2.4% (13.4)%
COST OF SALES, INCLUDING BUYING AND OCCUPANCY COSTS
Cost of sales, including buying and occupancy costs, increased
$1,577,000 or 3.0% during the Current Quarter to $53,971,000 from $52,394,000 in
the Comparable Quarter. As a percentage of net sales, these costs decreased to
73.9% from 74.7% in the Comparable Quarter. The nominal increase between periods
was due to the overall increase in sales. The decrease as a percentage of sales
was due to a combination of improved merchandise margins and an improvement in
the leveraging of buying and occupancy costs as a result of the comparable store
sales increase. Buying and occupancy costs were 17.9% and 18.2% of net sales for
the Current Quarter and Comparable Quarter, respectively.
SELLING AND ADMINISTRATIVE EXPENSES
Selling and administrative expenses increased $455,000 or 2.7% during
the Current Quarter to $17,134,000 from $16,679,000 in the Comparable Quarter.
As a percentage of net sales, these costs decreased to 23.5% from 23.8% in the
Comparable Quarter. The $455,000 increase was primarily due to a payment made
relating to an employee separation matter and an increase in merchant fees
relating to credit card sales. Similar to the percentage decrease in cost of
sales, including buying and occupancy expenses, this decrease as a percentage of
net sales was due to an improvement in the leveraging of buying and occupancy
costs as a result of the increase in net sales, particularly the comparable
store sales increase.
DEPRECIATION AND AMORTIZATION
Depreciation expense decreased $52,000 or 5.0% to $987,000 in the
Current Quarter from $1,039,000 in the Comparable Quarter. As a percentage of
net sales, these expenses decreased to 1.4% in the Current Quarter from 1.5% in
the Comparable Quarter. The decrease was due to the fact that certain older
stores are becoming fully depreciated, therefore reducing the amount of
recurring depreciation expense for these locations.
OTHER INCOME, PRINCIPALLY INTEREST
Other income, principally interest, decreased $12,000 or 3.0% to
$389,000 in the Current Quarter from $401,000 in the Comparable Quarter. The
decrease was the result of lower average interest rates during the Current
Quarter versus the Comparable Quarter, partially offset by higher cash balances.
- --------
(1) Includes Tops `N Bottoms stores
(2) Comparable store sales include stores open for both periods. A store is
added to the comparable store base in its 13th month of operation.
-7-
INCOME TAX PROVISION
The income tax provision for the Current Quarter was $502,000,
resulting in a 36.5% effective tax rate, as compared to $171,000 and a 37.9%
effective tax rate for the Comparable Quarter. The effective tax rate for the
Current Quarter is the rate estimated for Fiscal 2005. The effective tax rate
for the Comparable Quarter was the rate anticipated for Fiscal 2004, based on
originally budgeted earnings for that year. The actual effective rate for Fiscal
2004 was 35.8%.
LIQUIDITY AND CAPITAL RESOURCES
During the Current Quarter and Comparable Quarter, the Company funded
all of its operating needs internally, including capital expenditures for the
opening of new stores and the remodeling of existing stores. For the Current
Quarter, cash used in operating activities was $2,017,000. The use of cash
during this period was the result of decreases in accounts and income taxes
payable, accrued expenses and an increase in prepaid expenses. Offsetting these
uses of cash was net income, a reduction in merchandise inventories and non-cash
charges for depreciation and amortization. The $523,000 use of cash in operating
activities during the Comparable Quarter was the result of decreases in income
taxes and accounts payable, accrued expenses and an increase in prepaid
expenses. Offsetting these uses of cash was net income, a reduction in
merchandise inventories and non-cash charges for depreciation and amortization.
The inventory turnover rate was approximately 0.7 times during both the Current
Quarter and Comparable Quarter.
Net cash used in investing activities was $899,000 and $815,000 for the
Current Quarter and Comparable Quarter, respectively. These funds were used for
the opening of new stores and the remodeling of existing stores. During the
Current Quarter, the Company opened one and remodeled five stores, while during
the Comparable Quarter the Company opened four and remodeled nine stores.
Net cash used in financing activities was $1,321,000 and $1,382,000 for
the Current Quarter and Comparable Quarter, respectively. During both periods,
these funds were used for the payment of dividends on preferred and common stock
and, during the Current Quarter, the use of funds was partially offset by
proceeds from the exercise of stock options.
As of April 30, 2004, the Company had cash and cash equivalents of
$162,027,000 compared with $149,897,000 at April 30, 2003.
On May 19, 2004, the Company announced a special dividend of $0.40 per
share on its common stock. This special dividend will be incorporated into the
Company's next regularly scheduled dividend payment on August 17, 2004 for
shareholders of record as of July 30, 2004.
The Company believes that its existing cash and cash equivalents and
internally generated funds will be sufficient to meet its anticipated capital
expenditures, none of which are material, and current operating needs. The
Company had an unsecured line of credit in the amount of $20,000,000 as of April
30, 2004. Of this amount, $1,233,000 was outstanding as letters of credit for
the purchase of inventory. The Company leases its retail apparel stores,
warehouse and office building for periods ranging from one to 20 years.
Following is a summary of the Company's contractual obligations for minimum
rental payments on its non-cancelable operating leases and minimum payments on
its other commitments as of April 30, 2004.
Payments Due by Period
Less than 1 1 - 3 3 - 5 More than 5
Total year years years years
--------------------------------------------------------------------------------------
Operating leases $ 137,034,000 $ 23,446,000 $ 40,676,000 $ 29,275,000 $ 43,637,000
Other commitments 1,233,000 1,233,000 -- -- --
--------------------------------------------------------------------------------------
Total $ 138,267,000 $ 24,679,000 $ 40,676,000 $ 29,275,000 $ 43,637,000
======================================================================================
-8-
OTHER MATTERS
Seasonality and Quarterly Results
The Company's operating results are subject to seasonal fluctuations.
Highest sales levels have historically occurred during the five-month period
from August 1 to December 31 of each year (the back-to-school and holiday
periods). Sales generated during these periods have traditionally had a
significant impact on the Company's results of operations. Any decreases in
sales for these periods or in the availability of working capital needed in the
months preceding these periods could have a material adverse effect on the
Company's results of operations. Results of operations in any one fiscal quarter
are not necessarily indicative of the results of operations that can be expected
for any other fiscal quarter or for the full fiscal year.
The Company's results of operations may also fluctuate from quarter to
quarter as a result of the amount and timing of expenses incurred in connection
with, and sales contributed by, new stores, store remodels and the integration
of new stores into the operations of the Company.
ITEM 3.
- -------
QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
As of April 30, 2004, the Company had cash and cash equivalents of
$162,027,000 compared to $149,897,000 as of April 30, 2003, and $138,969,000 as
of April 30, 2002. These funds are invested primarily in money market mutual
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.
- -------
CONTROLS AND PROCEDURES
(a) Evaluation of Disclosure Controls and Procedures
The Company's chief executive officer and chief financial officer, with the
participation of other members of the Company's management, have evaluated the
effectiveness of the Company's disclosure controls and procedures (as defined in
Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended) as of the
end of the period covered by this report (the "Evaluation Date") and, based on
that evaluation, concluded that, as of the Evaluation Date, the Company had
sufficient controls and procedures for recording, processing, summarizing and
reporting information that is required to be disclosed in its reports under the
Securities Exchange Act of 1934, as amended, within the time periods specified
in the SEC's rules and forms.
(b) Change in Internal Control over Financial Reporting
There has not been any change in the Company's internal control over
financial reporting during its quarter ended April 30, 2004 that has materially
affected or is reasonably likely to materially affect its internal control over
financial reporting.
-9-
PART II. OTHER INFORMATION
ITEMS 1 - 5. NOT APPLICABLE
- ------------
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
- ------- --------------------------------
(a) Exhibits
Exhibit 10.1 Agreement and General Release between Deb Shops,
Inc. and Barry Vesotsky
Exhibit 31.1 Section 302 Certification by President and Chief
Executive Officer
Exhibit 31.2 Section 302 Certification by Chief Financial
Officer
Exhibit 32.1 Certification of Periodic Report by President
and Chief Executive Officer
Exhibit 32.2 Certification of Periodic Report by Chief
Financial Officer
(b) Reports on Form 8-K
The following reports on Form 8-K were furnished by the Company to the
Securities and Exchange Commission during the first quarter of the
fiscal year ending January 31, 2005:
1. Report on Form 8-K, filed February 6, 2004, including the
press release dated February 5, 2004 entitled "Deb Shops,
Inc. Reports Sales for January and the Fourth Quarter and
the Full Year Ended January 31, 2004. Management Also
Announces Internet Sales Channel Upgrade."
2. Report on Form 8-K, filed March 5, 2004, including the press
release dated March 5, 2004 entitled "Deb Shops
Pre-Announces Fourth Quarter Results."
3. Report on Form 8-K, filed March 9, 2004, including the press
release dated March 9, 2004 entitled "Deb Shops Reports
Fourth Quarter and Full-Year Results - Establishes Fiscal
2005 Guidance of $1.20 to $1.30 per Diluted Share."
-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: June 9, 2004 By: Marvin Rounick
--------------
Marvin Rounick
President and Chief Executive Officer
DATE: June 9, 2004 By: Barry J. Susson, CPA
--------------------
Barry J. Susson
Chief Financial Officer