-
Loss Per Share of $0.06 Compares to Loss Per Share of $0.12 Last
Year
-
North American Comparable Store Sales Increase 3.6%
ST. LOUIS--(BUSINESS WIRE)--May. 3, 2012--
Build-A-Bear Workshop, Inc. (NYSE: BBW), an interactive entertainment
retailer, today reported results for the 2012 first quarter ended March
31, 2012.
First Quarter 2012 Highlights:
-
Consolidated net retail sales of $95.2 million represented a 1.6%
increase compared to $94.2 million, in the 2011 first quarter,
excluding the impact of foreign exchange;
-
Consolidated comparable store sales increased 1.2% and included a 3.6%
increase in North America and a 10.1% decline in Europe;
-
Consolidated e-commerce sales rose 9.1%, excluding the impact of
foreign exchange;
-
Net loss of $1.0 million, or $0.06 per share improved from a net loss
of $2.3 million, or $0.12 per share in the 2011 first quarter; and
-
Adjusted net loss was $0.5 million, or $0.03 per share compared to an
adjusted net loss of $1.3 million, or $0.07 per share in the 2011
first quarter. (See Reconciliation of Net Loss to Adjusted Net Loss)
“We are off to a solid start for the year with increased comparable
store sales, growth in e-commerce and international franchise revenues
and a considerable improvement in our operating performance for the
quarter,” stated Maxine Clark, Build-A-Bear Workshop Chief Executive
Bear. “Our performance reflects strength in our gift giving initiatives
and the benefit of strong Easter product and promotions particularly in
North America where our comp store sales increased 3.6% while our
European business was impacted by a challenging economic environment.
Through the end of April, which captures the impact in the change of
Easter, our comp sales are essentially flat, with an increase in North
America and a significant improvement in our UK trend. As we move
forward, we remain confident in the strategies that we set for the year
and fully expect to deliver solid sales growth and profitability in
2012,” Ms. Clark concluded.
Additional Operating Highlights
-
Total revenues were $96.4 million compared to $96.0 million in the
fiscal 2011 first quarter, an increase of 0.9%, excluding the impact
of foreign exchange;
-
Retail gross margin was 39.9%, a 110 basis point increase from retail
gross margin of 38.8% in the 2011 first quarter; and
-
Pre-tax loss improved to $1.1 million from a pre-tax loss of $3.6
million in the 2011 first quarter.
Store Expansion
During the quarter, the Company opened two stores in North America. At
quarter end the Company operated 348 company-owned stores – 290 in North
America and 58 in Europe, as compared to 288 in North America and 54 in
Europe at the end of the fiscal 2011 first quarter. The Company’s
international franchisees opened three stores, net of closures,
finishing the fiscal 2012 first quarter with 82 stores.
Balance Sheet
The Company ended the 2012 first quarter with a strong balance sheet and
no borrowings under its revolving credit facility. As of March 31, 2012,
cash and cash equivalents totaled $33.5 million, over 50% of which was
domiciled outside the U.S. Total inventory at quarter end was $45.6
million. Inventory per square foot increased 15.0%, as compared to the
prior year period, when inventory was unusually low. On a two-year
basis, inventory per square foot declined 3.3%.
In 2012, the Company continues to expect to open four to six new stores,
relocate ten to fifteen stores, remodel approximately six stores in a
new design and close fifteen to twenty stores in North America. The
Company’s capital expenditures are expected to be approximately $20 to
$25 million in 2012. Depreciation and amortization is expected to be
approximately $22 million.
2012 Objectives
To increase long-term shareholder value, the Company continues to expect
to:
-
Introduce a new store design to enhance the bear-making
experience and drive store traffic and sales. The Company expects to
open approximately six of these stores starting in late fall.
-
Improve store productivity and profitability by closing select
stores during the year, transferring a percentage of the sales to
other stores in the same markets. The Company will also reduce the
square footage of other stores by relocating them within the same
malls.
-
Increase shopping frequency by increasing new Guest traffic to
its stores by rebalancing its marketing messages to include both
product and brand, and by refreshing its loyalty program to increase
Guest retention.
-
Reinforce Build-A-Bear Workshop as the top destination for gifts,
capitalizing on its 15th birthday occasion to take this initiative to
an entirely new level.
-
Increase the Company’s global presence with the anticipated
opening of ten to twelve international franchise locations, net of
closures in 2012.
-
Improve cost efficiencies with approximately $9 million in
savings in fiscal 2012, a portion of which will offset expected
product cost increases and support sales-driving marketing initiatives.
Today’s Conference Call Webcast
Build-A-Bear Workshop will host a live Internet webcast of its quarterly
investor conference call at 9 a.m. ET today. The audio broadcast may be
accessed at our investor relations Web site, http://IR.buildabear.com.
The call is expected to conclude by 10 a.m.
A replay of the conference call webcast will be available in the
investor relations Web site for one year. A telephone replay will be
available beginning at approximately noon ET today until midnight ET on
May 10, 2012. The telephone replay is available by calling (858)
384-5517. The access code is 392073.
About Build-A-Bear Workshop, Inc.
Build-A-Bear Workshop, Inc. is the only global company that offers an
interactive make-your-own stuffed animal retail-entertainment
experience. There are more than 400 Build-A-Bear Workshop stores
worldwide, including company-owned stores in the U.S., Puerto Rico,
Canada, the United Kingdom and Ireland, and franchise stores in Europe,
Asia, Australia, Africa, the Middle East, Mexico and South America.
Founded in St. Louis in 1997, Build-A-Bear Workshop is the leader in
interactive retail. Brands include make-your-own Major League Baseball®
mascot in-stadium locations, and Build-A-Dino® stores.
Build-A-Bear Workshop extends its in-store interactive experience online
with its award winning virtual world Web site at bearville.com®.
The company was named to the FORTUNE 100 Best Companies to Work For®
list for the fourth year in a row in 2012. Build-A-Bear Workshop (NYSE:
BBW) posted total revenue of $394.4 million in fiscal 2011. For more
information, call 888.560.BEAR (2327) or visit the company's
award-winning Web site at buildabear.com®.
Forward-Looking Statements
This press release contains "forward-looking statements" (within the
meaning of the federal securities laws) which represent Build-A-Bear
Workshop expectations or beliefs with respect to future events. Our
actual results may differ materially from the results discussed in the
forward-looking statements. These risks and uncertainties include,
without limitation, those detailed under the caption “Risk Factors” in
our annual report on Form 10-K for the fiscal year ended December 31,
2011, as filed with the SEC, and the following: general global economic
conditions may continue to deteriorate, which could lead to
disproportionately reduced consumer demand for our products, which
represent relatively discretionary spending; customer traffic may
decrease in the shopping malls where we are located, on which we depend
to attract guests to our stores; we may be unable to generate interest
in and demand for our interactive retail experience, or to identify and
respond to consumer preferences in a timely fashion; our marketing and
on-line initiatives may not be effective in generating sufficient levels
of brand awareness and guest traffic; we may be unable to generate
comparable store sales growth; we may be unable to effectively operate
or manage the overall portfolio of our company-owned stores; we may be
unable to renew or replace our store leases, or enter into leases for
new stores on favorable terms or in favorable locations, or may violate
the terms of our current leases; the availability and costs of our
products could be adversely affected by risks associated with
international manufacturing and trade, including foreign currency
fluctuation; our products could become subject to recalls or product
liability claims that could adversely impact our financial performance
and harm our reputation among consumers; we are susceptible to
disruption in our inventory flow due to our reliance on a few vendors;
high petroleum products prices could increase our inventory
transportation costs and adversely affect our profitability; we may not
be able to operate our company-owned stores in the United Kingdom and
Ireland profitably; we may be unable to effectively manage our
international franchises or laws relating to those franchises may
change; we may improperly obtain or be unable to protect information
from our guests in violation of privacy or security laws or
expectations; we may suffer negative publicity or be sued due to
violations of labor laws or unethical practices by manufacturers of our
merchandise; we may suffer negative publicity or negative sales if the
non-proprietary toy products we sell in our stores do not meet our
quality or sales expectations; we may lose key personnel, be unable to
hire qualified additional personnel, or experience turnover of our
management team; we may be unable to operate our company-owned
distribution center efficiently or our third-party distribution center
providers may perform poorly; our market share could be adversely
affected by a significant, or increased, number of competitors; we may
fail to renew, register or otherwise protect our trademarks or other
intellectual property; poor global economic conditions could have a
material adverse effect on our liquidity and capital resources; we may
have disputes with, or be sued by, third parties for infringement or
misappropriation of their proprietary rights; fluctuations in our
quarterly results of operations could cause the price of our common
stock to substantially decline; and we may be unable to repurchase
shares of our common stock at the times or in the amounts we currently
anticipate or the results of the share repurchase program may not be as
beneficial as we currently anticipate. These risks, uncertainties and
other factors may adversely affect our business, growth, financial
condition or profitability, or subject us to potential liability, and
cause our actual results, performance or achievements to be materially
different from those expressed or implied by our forward-looking
statements. The Company undertakes no obligation to publicly update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
All other brand names, product names, or trademarks belong to their
respective holders.
|
|
|
|
|
|
BUILD-A-BEAR WORKSHOP, INC. AND SUBSIDIARIES
|
|
Unaudited Condensed Consolidated Statements of Operations
|
|
(dollars in thousands, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13 Weeks
|
|
|
|
|
|
13 Weeks
|
|
|
|
|
|
|
|
|
Ended
|
|
|
|
|
|
Ended
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
% of Total
|
|
|
April 2,
|
|
|
% of Total
|
|
|
|
|
|
2012
|
|
|
Revenues (1) |
|
|
2011
|
|
|
Revenues (1) |
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net retail sales
|
|
|
|
$
|
95,200
|
|
|
|
98.8
|
|
|
$
|
94,159
|
|
|
|
98.1
|
|
Commercial revenue
|
|
|
|
|
376
|
|
|
|
0.4
|
|
|
|
1,106
|
|
|
|
1.2
|
|
Franchise fees
|
|
|
|
|
797
|
|
|
|
0.8
|
|
|
|
726
|
|
|
|
0.8
|
|
Total revenues
|
|
|
|
|
96,373
|
|
|
|
100.0
|
|
|
|
95,991
|
|
|
|
100.0
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of merchandise sold
|
|
|
|
|
57,466
|
|
|
|
60.1
|
|
|
|
58,225
|
|
|
|
61.1
|
|
Selling, general and administrative
|
|
|
|
|
40,014
|
|
|
|
41.5
|
|
|
|
41,265
|
|
|
|
43.0
|
|
Store preopening
|
|
|
|
|
112
|
|
|
|
0.1
|
|
|
|
47
|
|
|
|
0.0
|
|
Interest expense (income), net
|
|
|
|
|
(86
|
)
|
|
|
(0.1)
|
|
|
|
103
|
|
|
|
0.1
|
|
Total costs and expenses
|
|
|
|
|
97,506
|
|
|
|
101.2
|
|
|
|
99,640
|
|
|
|
103.8
|
|
Loss before income taxes
|
|
|
|
|
(1,133
|
)
|
|
|
(1.2)
|
|
|
|
(3,649
|
)
|
|
|
(3.8)
|
|
Income tax benefit
|
|
|
|
|
(116
|
)
|
|
|
(0.1)
|
|
|
|
(1,398
|
)
|
|
|
(1.5)
|
|
Net loss
|
|
|
|
$
|
(1,017
|
)
|
|
|
(1.1)
|
|
|
$
|
(2,251
|
)
|
|
|
(2.3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
$
|
(0.06
|
)
|
|
|
|
|
|
$
|
(0.12
|
)
|
|
|
|
|
Diluted
|
|
|
|
$
|
(0.06
|
)
|
|
|
|
|
|
$
|
(0.12
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in computing common per share amounts:
|
|
|
Basic
|
|
|
|
|
16,038,880
|
|
|
|
|
|
|
|
18,090,245
|
|
|
|
|
|
Diluted
|
|
|
|
|
16,038,880
|
|
|
|
|
|
|
|
18,090,245
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Selected statement of operations data expressed as a percentage of
total revenues, except cost of merchandise sold which is expressed
as a percentage of net retail sales and commercial revenue.
Percentages will not total due to cost of merchandise sold being
expressed as a percentage of net retail sales and commercial revenue
and immaterial rounding.
|
|
|
|
|
BUILD-A-BEAR WORKSHOP, INC. AND SUBSIDIARIES
|
|
Unaudited Condensed Consolidated Balance Sheets
|
|
(dollars in thousands, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
December 31,
|
|
|
April 2,
|
|
|
|
|
|
2012
|
|
|
2011
|
|
|
2011
|
|
ASSETS
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
$
|
33,501
|
|
|
|
$
|
46,367
|
|
|
|
$
|
45,124
|
|
|
Inventories
|
|
|
|
|
45,584
|
|
|
|
|
51,860
|
|
|
|
|
39,492
|
|
|
Receivables
|
|
|
|
|
4,170
|
|
|
|
|
7,878
|
|
|
|
|
3,503
|
|
|
Prepaid expenses and other current assets
|
|
|
|
|
15,926
|
|
|
|
|
17,854
|
|
|
|
|
19,128
|
|
|
Deferred tax assets
|
|
|
|
|
480
|
|
|
|
|
419
|
|
|
|
|
7,539
|
|
|
Total current assets
|
|
|
|
|
99,661
|
|
|
|
|
124,378
|
|
|
|
|
114,786
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, net
|
|
|
|
|
74,771
|
|
|
|
|
77,445
|
|
|
|
|
83,461
|
|
|
Goodwill
|
|
|
|
|
33,423
|
|
|
|
|
32,306
|
|
|
|
|
33,561
|
|
|
Other intangible assets, net
|
|
|
|
|
728
|
|
|
|
|
655
|
|
|
|
|
1,264
|
|
|
Other assets, net
|
|
|
|
|
6,929
|
|
|
|
|
6,787
|
|
|
|
|
14,462
|
|
|
Total Assets
|
|
|
|
$
|
215,512
|
|
|
|
$
|
241,571
|
|
|
|
$
|
247,534
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
|
|
$
|
22,741
|
|
|
|
$
|
41,032
|
|
|
|
$
|
25,103
|
|
|
Accrued expenses
|
|
|
|
|
7,296
|
|
|
|
|
12,128
|
|
|
|
|
6,363
|
|
|
Gift cards and customer deposits
|
|
|
|
|
25,221
|
|
|
|
|
28,323
|
|
|
|
|
24,291
|
|
|
Deferred revenue
|
|
|
|
|
5,431
|
|
|
|
|
5,285
|
|
|
|
|
6,761
|
|
|
Total current liabilities
|
|
|
|
|
60,689
|
|
|
|
|
86,768
|
|
|
|
|
62,518
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred franchise revenue
|
|
|
|
|
1,368
|
|
|
|
|
1,436
|
|
|
|
|
1,639
|
|
|
Deferred rent
|
|
|
|
|
22,728
|
|
|
|
|
23,867
|
|
|
|
|
27,387
|
|
|
Other liabilities
|
|
|
|
|
257
|
|
|
|
|
257
|
|
|
|
|
344
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
|
|
|
|
|
|
|
Common stock, par value $0.01 per share
|
|
|
|
|
174
|
|
|
|
|
174
|
|
|
|
|
196
|
|
|
Additional paid-in capital
|
|
|
|
|
65,168
|
|
|
|
|
65,402
|
|
|
|
|
74,409
|
|
|
Accumulated other comprehensive income
|
|
|
|
|
(7,689
|
)
|
|
|
|
(10,165
|
)
|
|
|
|
(7,602
|
)
|
|
Retained earnings
|
|
|
|
|
72,817
|
|
|
|
|
73,832
|
|
|
|
|
88,643
|
|
|
Total stockholders' equity
|
|
|
|
|
130,470
|
|
|
|
|
129,243
|
|
|
|
|
155,646
|
|
|
Total Liabilities and Stockholders' Equity
|
|
|
|
$
|
215,512
|
|
|
|
$
|
241,571
|
|
|
|
$
|
247,534
|
|
|
|
|
|
|
BUILD-A-BEAR WORKSHOP, INC. AND SUBSIDIARIES
|
|
Unaudited Selected Financial and Store Data
|
|
(dollars in thousands, except square foot data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13 Weeks
|
|
|
13 Weeks
|
|
|
|
|
|
|
Ended
|
|
|
Ended
|
|
|
|
|
|
|
March 31,
|
|
|
April 2,
|
|
|
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
Other financial data:
|
|
|
|
|
|
|
|
|
|
Retail gross margin ($) (1) |
|
|
|
|
$
|
38,011
|
|
|
|
$
|
36,578
|
|
|
Retail gross margin (%) (1) |
|
|
|
|
|
39.9
|
%
|
|
|
|
38.8
|
%
|
|
E-commerce sales
|
|
|
|
|
$
|
3,125
|
|
|
|
$
|
2,875
|
|
|
Capital expenditures, net (2) |
|
|
|
|
$
|
3,779
|
|
|
|
$
|
2,322
|
|
|
Depreciation and amortization
|
|
|
|
|
$
|
5,362
|
|
|
|
$
|
6,524
|
|
|
|
|
|
|
|
|
|
|
|
|
Store data (3):
|
|
|
|
|
|
|
|
|
|
Number of company-owned stores at end of period
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
|
|
|
290
|
|
|
|
|
288
|
|
|
Europe
|
|
|
|
|
|
58
|
|
|
|
|
54
|
|
|
Total stores
|
|
|
|
|
|
348
|
|
|
|
|
342
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of franchised stores at end of period
|
|
|
|
|
|
82
|
|
|
|
|
63
|
|
|
|
|
|
|
|
|
|
|
|
|
Company-owned store square footage at end of period
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
|
|
|
832,753
|
|
|
|
|
834,346
|
|
|
Europe (4) |
|
|
|
|
|
84,022
|
|
|
|
|
77,870
|
|
|
Total square footage
|
|
|
|
|
|
916,775
|
|
|
|
|
912,216
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable store sales change (%) (5) |
|
|
|
|
|
|
|
|
|
North America
|
|
|
|
|
3.6%
|
|
|
(9.3)%
|
|
Europe
|
|
|
|
|
(10.1)%
|
|
|
(4.1)%
|
|
Consolidated
|
|
|
|
|
1.2%
|
|
|
(8.5)%
|
|
|
|
|
(1)
|
|
Retail gross margin represents net retail sales less retail cost of
merchandise sold. Retail gross margin percentage represents retail
gross margin divided by net retail sales.
|
(2)
|
|
Capital expenditures, net represents cash paid for property,
equipment, other assets and other intangible assets.
|
(3)
|
|
Excludes our webstore and pop-up, seasonal and event-based
locations. North American stores are located in the United States,
Canada and Puerto Rico. In Europe, stores are located in the United
Kingdom and Ireland.
|
(4)
|
|
Square footage for stores located in Europe is estimated selling
square footage.
|
(5)
|
|
Comparable store sales percentage changes are based on net retail
sales and stores are considered comparable beginning in their
thirteenth full month of operation.
|
|
|
|
|
* Non-GAAP Financial Measures
|
|
|
In this press release, the Company’s financial results are provided
both in accordance with generally accepted accounting principles
(GAAP) and using certain non-GAAP financial measures. In particular,
the Company provides historic earnings (loss) and earnings (loss)
per diluted share adjusted to exclude certain costs and accounting
adjustments, which are non-GAAP financial measures. These results
are included as a complement to results provided in accordance with
GAAP because management believes these non-GAAP financial measures
help identify underlying trends in the Company’s business and
provide useful information to both management and investors by
excluding certain items that may not be indicative of the Company’s
core operating results. These measures should not be considered a
substitute for or superior to GAAP results.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BUILD-A-BEAR WORKSHOP, INC. AND SUBSIDIARIES
|
|
|
|
Reconciliation of Net Loss to Adjusted Net Loss
|
|
|
|
(dollars in thousands, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13 Weeks
|
|
|
13 Weeks
|
|
|
|
|
|
|
|
|
|
|
|
Ended
|
|
|
Ended
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
April 1,
|
|
|
|
|
|
|
|
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
Net loss
|
|
|
|
$
|
(1,017
|
)
|
|
|
$
|
(2,251
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Losses from investment in affiliate(1) |
|
|
|
|
475
|
|
|
|
|
-
|
|
|
|
|
|
|
Consulting project costs(2) |
|
|
|
|
-
|
|
|
|
|
926
|
|
|
|
|
|
Adjusted net loss
|
|
|
|
$
|
(542
|
)
|
|
|
$
|
(1,325
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1
|
)
|
|
Represents non-recurring charge related to the Company's investment
in Ridemakerz
|
|
|
|
|
|
|
|
|
|
|
|
|
(2
|
)
|
|
Represents costs of a cost reduction consulting project undertaken
in 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13 Weeks
|
|
|
13 Weeks
|
|
|
|
|
|
|
|
|
|
|
|
Ended
|
|
|
Ended
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
April 1,
|
|
|
|
|
|
|
|
|
|
|
|
2012
|
|
|
2011
|
|
|
|
|
Net loss
|
|
|
|
$
|
(0.06
|
)
|
|
|
$
|
(0.12
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Losses from investment in affiliate(1) |
|
|
|
|
0.03
|
|
|
|
|
-
|
|
|
|
|
|
|
Consulting project costs(2) |
|
|
|
|
-
|
|
|
|
|
0.05
|
|
|
|
|
|
Adjusted net loss
|
|
|
|
$
|
(0.03
|
)
|
|
|
$
|
(0.07
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|

Source: Build-A-Bear Workshop, Inc.
Build-A-Bear Workshop Investors: Tina Klocke, 314-423-8000
x5210 or Media: Jill Saunders, 314-423-8000 x5293
|