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8-K - 8-K - BODY CENTRAL CORPa12-6999_18k.htm

Exhibit 99.1

 

 

 

 

Body Central Corp. Fiscal Year Net Income Increases 101% to $19.7 Million

 

Jacksonville, FL — March 8, 2012 — Body Central Corp. (Nasdaq: BODY) today announced financial results for the fourth quarter and fiscal year 2011.

 

Highlights for the fourth quarter ended December 31, 2011:

 

·                  Net revenues for the quarter increased 20.4% to $80.7 million, compared to $67.1 million last year.

·                  Store sales rose 20.7% to $73.0 million driven by a comparable-store sales increase of 6.8% and net store unit growth of 15.3%.

·                  Operating income increased 61.7% to $9.8 million as compared to $6.1 million last year. Operating margin increased to 12.2% of net revenues from 9.0% of net revenues for the same period last year.

·                  Net income was $6.1 million, or $0.38 per diluted share based on 16.2 million weighted average shares outstanding, as compared to net income of $2.7 million, or $0.18 per diluted share based on 15.6 million weighted average shares outstanding for the fourth quarter of 2010.

·                  The Company opened 16 new stores during the fourth quarter and operated 241 stores as of December 31, 2011.

 

Highlights for the fiscal year ended December 31, 2011:

 

·                  Net revenues increased 21.8% to $296.5 million from $243.4 million for the same period a year ago.

·                  Store sales rose 25.0% to $261.8 million driven by a comparable-store sales increase of 11.3% and net store unit growth of 15.3%.

·                  Operating income increased 58.0% to $31.4 million as compared to $19.9 million last year.  Operating margin increased to 10.6% of net revenues from 8.2% of net revenues for the same period last year.

·                  Net income was $19.7 million or $1.22 per diluted share based on 16.2 million weighted average shares outstanding, as compared to net income of $9.8 million, or $0.73 per diluted share based on 13.4 million weighted average shares outstanding for fiscal 2010.

·                  The Company opened 33 new stores during fiscal year 2011.

 

Allen Weinstein, Body Central’s President and CEO, stated: “We closed 2011 with strong sales and earnings growth in the fourth quarter. In addition, we ended the quarter with inventory current and on plan. We are against two consecutive years of mid-teen comp sales increases in the first quarter and have experienced a softening in our sales trend quarter-to-date. Our direct business is ahead of plan. We have taken steps to enhance the merchandise assortment and expect sales trends to improve in the second quarter. Also, we are on track to open at least 35 new stores this year including 4 new stores and 2 store closings in the first quarter of 2012. We remain confident in our ability to drive positive comp sales and margin improvement for the year.”

 



 

Balance Sheet highlights as of December 31, 2011:

 

Cash and cash equivalents were $42.0 million at the end of the fourth quarter compared to $16.2 million in the prior year.

 

The Company had no long-term debt at the end of the fourth quarter in either 2011 or 2010.

 

Inventories at the end of the fourth quarter were $21.1 million compared to $18.4 million at the end of the fourth quarter of 2010. Average store inventories increased 4.3% from one year ago.

 

Reported results are preliminary and not final until the filing of our Form 10-K with the SEC and remain subject to adjustment.

 

Outlook

 

For the first quarter of fiscal 2012, the Company expects net revenues in the range of $80 million to $82 million and diluted earnings per share in the range of $0.34 to $0.36, based on diluted weighted-average shares outstanding of 16.2 million.

 

For fiscal 2012, the Company expects net revenues in the range of $343 million to $348 million and diluted earnings per share in the range of $1.46 to $1.50, based on diluted weighted-average shares outstanding of 16.3 million.

 

Conference Call Information

 

A conference call to discuss fourth quarter financial results is scheduled for today, March 8, 2012, at 4:30 PM Eastern Time. The conference call will also be webcast live at www.bodyc.com. To access the replay of this call, please dial (877) 870-5176 and enter pin number 1975043. The replay is available until March 22, 2012. A replay of this call will also be available on the Investor Relations section of the Company’s website, www.bodyc.com, within two hours of the conclusion of the call and will remain on the website for ninety days.

 

About Body Central

 

Founded in 1972, Body Central Corp. is a growing, multi-channel, specialty retailer offering on-trend, quality apparel and accessories at value prices. As of March 8, 2012 the Company operated 241 specialty apparel stores in 24 states under the Body Central and Body Shop banners, as well as a direct business comprised of a Body Central catalog and an e-commerce website at www.bodyc.com. The Company targets women in their late teens and twenties from diverse cultural backgrounds who seek the latest fashions and a flattering fit. Stores feature an assortment of tops, dresses, bottoms, jewelry, accessories and shoes sold primarily under the Company’s exclusive Body Central(R) and Lipstick(R) labels.

 

CONTACT:

Tom Stoltz

Executive Vice President and Chief Financial Officer

904-207-6720

tstoltz@bodyc.com

 



 

Safe Harbor Language

 

Certain statements in this release are “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words such as “guidance,” “expects,” “intends,” “projects,” “plans,” “believes,” “estimates,” “targets,” “anticipates,” and similar expressions are used to identify these forward-looking statements. Forward-looking statements are based on our current expectations and assumptions, which may not prove to be accurate. These statements are not guarantees and are subject to risks, uncertainties and changes in circumstances that are difficult to predict. Many factors could cause actual results to differ materially and adversely from these forward-looking statements. Among these factors are (1) our ability to identify and respond to new and changing fashion trends, customer preferences and other related factors; (2) our ability to execute successfully our growth strategy; (3) changes in consumer spending and general economic conditions; (4) changes in the competitive environment in our industry and the markets we serve, including increased competition from other retailers; (5) our new stores or existing stores achieving sales and operating levels consistent with our expectations;  (6) our dependence on a strong brand image; (7) our direct business growing consistently with our growth strategy; (8) our information technology systems supporting our current and growing business, before and after our planned upgrades; (9) disruptions to our information systems in the ordinary course or as a result of systems upgrades; (10) our dependence upon key executive management or our inability to hire or retain additional personnel;  (11) disruptions in our supply chain and distribution facility; (12) our lease obligations; (13) our reliance upon independent third-party transportation providers for all of our product shipments; (14) hurricanes, natural disasters, unusually adverse weather conditions, boycotts and unanticipated events; (15) the seasonality of our business; (16) increases in costs of fuel, or other energy, transportation or utilities costs and in the costs of labor and employment; (17) the impact of governmental laws and regulations and the outcomes of legal proceedings;  (18) our maintaining effective internal controls; and (19) our ability to protect our trademarks or other intellectual property rights.

 



 

BODY CENTRAL CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS

 

 

 

Thirteen Weeks Ended

 

Fiscal Year Ended

 

 

 

December 31,

 

January 1,

 

December 31,

 

January 1,

 

 

 

2011

 

2011

 

2011

 

2011

 

 

 

(in thousands, except share and per share data)

 

Net revenues

 

$

80,736

 

$

67,076

 

$

296,500

 

$

243,364

 

Cost of goods sold, including occupancy, buying, distribution center and catalog costs

 

52,700

 

43,486

 

193,101

 

161,802

 

Gross profit

 

28,036

 

23,590

 

103,399

 

81,562

 

Selling, general and administrative expenses

 

16,830

 

16,257

 

66,803

 

56,920

 

Depreciation and amortization

 

1,389

 

1,263

 

5,204

 

4,773

 

Impairment of long-lived assets

 

 

 

 

 

Income from operations

 

9,817

 

6,070

 

31,392

 

19,869

 

Interest expense, net of interest income

 

(2

)

711

 

(16

)

3,292

 

Other expense (income), net

 

(31

)

413

 

(237

)

308

 

Income before income taxes

 

9,850

 

4,946

 

31,645

 

16,269

 

Provision for income taxes

 

3,711

 

2,198

 

11,925

 

6,458

 

Net income

 

$

6,139

 

$

2,748

 

$

19,720

 

$

9,811

 

 

 

 

 

 

 

 

 

 

 

Net income per common share:

 

 

 

 

 

 

 

 

 

Basic

 

$

0.38

 

$

0.21

 

$

1.25

 

$

2.77

 

Diluted

 

$

0.38

 

$

0.18

 

$

1.22

 

$

0.73

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding:

 

 

 

 

 

 

 

 

 

Basic

 

16,014,571

 

13,400,952

 

15,780,908

 

3,502,657

 

Diluted

 

16,243,016

 

15,565,686

 

16,218,382

 

13,383,642

 

 



 

BODY CENTRAL CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

December 31,

 

January 1,

 

 

 

2011

 

2011

 

 

 

(In thousands)

 

Assets

 

 

 

 

 

Current assets

 

 

 

 

 

Cash and cash equivalents

 

$

41,993

 

$

16,202

 

Accounts receivable

 

2,607

 

1,258

 

Inventories

 

21,141

 

18,369

 

Prepaid expenses and other current assets

 

4,293

 

3,933

 

Deferred tax asset, current

 

1,953

 

1,425

 

Total current assets

 

71,987

 

41,187

 

Property and equipment, net of accumulated depreciation and amortization

 

22,159

 

17,071

 

Goodwill

 

21,508

 

21,508

 

Intangible assets, net of accumulated amortization

 

16,542

 

17,128

 

Other assets

 

106

 

102

 

Total assets

 

$

132,302

 

$

96,996

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

Current liabilities

 

 

 

 

 

Accounts payable

 

$

16,498

 

$

14,880

 

Accrued expenses and other current liabilities

 

18,608

 

14,605

 

Total current liabilities

 

35,106

 

29,485

 

Other liabilities

 

7,899

 

5,149

 

Deferred tax liability, long-term

 

4,225

 

4,220

 

Total liabilities

 

47,230

 

38,854

 

Commitments and contingencies

 

 

 

 

 

Stockholders’ equity

 

85,072

 

58,142

 

 

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

132,302

 

$

96,996

 

 



 

BODY CENTRAL CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

 

Fiscal Year Ended

 

 

 

December 31,
2011

 

January 1,
2011

 

 

 

(in thousands)

 

Cash flows from operating activities

 

 

 

 

 

Net income

 

$

19,720

 

$

9,811

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

Depreciation and amortization

 

5,204

 

4,773

 

Stock-based compensation

 

1,060

 

563

 

Deferred income taxes

 

(523

)

2,076

 

Excess tax benefits from stock-based compensation

 

(3,453

)

 

Loss on disposal of property and equipment

 

29

 

534

 

Changes in assets and liabilities:

 

 

 

 

 

Accounts receivable

 

(1,349

)

(350

)

Inventories

 

(2,772

)

(5,471

)

Prepaid expenses and other current assets

 

(360

)

(1,285

)

Other assets

 

(4

)

19

 

Accounts payable

 

1,618

 

5,802

 

Accrued expenses and other current liabilities

 

4,238

 

1,963

 

Income taxes

 

3,218

 

156

 

Other liabilities

 

2,822

 

818

 

Net cash provided by operating activities

 

29,448

 

19,409

 

Cash flows from investing activities

 

 

 

 

 

Purchases of property and equipment

 

(9,806

)

(6,804

)

Net cash used in investing activities

 

(9,806

)

(6,804

)

Cash flows from financing activities

 

 

 

 

 

Principal payments on long-term debt

 

 

(38,250

)

Excess tax benefits from stock-based compensation

 

3,453

 

 

Proceeds from public offerings, net of issuance costs

 

1,143

 

38,152

 

Proceeds from the issuance of stock options

 

1,553

 

 

 

Redemption of Series C preferred stock

 

 

(3,531

)

Net cash provided by (used in) financing activities

 

6,149

 

(3,629

)

Net increase in cash and cash equivalents

 

25,791

 

8,976

 

Cash and cash equivalents

 

 

 

 

 

Beginning of year

 

16,202

 

7,226

 

End of period

 

$

41,993

 

$

16,202