View:
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported)
April 7, 2005
Build-A-Bear Workshop, Inc.
---------------------------
(Exact Name of Registrant as Specified in Its Charter)
Delaware 001-32320 43-1883836
- ----------------- -------------- -------------------
(State or Other (Commission (IRS Employer
Jurisdiction of File Number) Identification No.)
Incorporation)
1954 Innerbelt Business Center Drive 63114
St. Louis, Missouri ------------
- ---------------------------------------- (Zip Code)
(Address of Principal Executive Offices)
(314) 423-8000
----------------------------------------------------
(Registrant's Telephone Number, Including Area Code)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 2.02. Results of Operations and Financial Condition.
- ---------------------------------------------------------
On April 7, 2005, Build-A-Bear Workshop, Inc. issued a press release
announcing, among other things, net retail sales, comparable store sales and
expected diluted earnings per share for the first quarter of fiscal 2005. The
press release also included expected earnings and diluted earnings per share for
the second quarter of fiscal 2005 and for the full year fiscal 2005. A copy of
the press release is furnished as Exhibit 99.1 hereto and is incorporated by
reference herein. The description of the press release contained herein is
qualified in its entirety by the full text of such exhibit.
Item 9.01 Financial Statements and Exhibits.
- --------------------------------------------
(c) Exhibits
Exhibit Number Description of Exhibit
- -------------- ----------------------
99.1 Press Release dated April 7, 2005
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 hereunto duly authorized.
BUILD-A-BEAR WORKSHOP, INC.
(Registrant)
Date: April 7, 2005 /s/ Tina Klocke
--------------------------------------
Name: Tina Klocke
Title: Chief Financial Bear, Secretary
and Treasurer
EXHIBIT INDEX
Exhibit Number Description of Exhibit
- -------------- ----------------------
99.1 Press Release dated April 7, 2005
Exhibit 99.1
Build-A-Bear Workshop, Inc. Reports 2005 First Quarter Retail Sales and
Comparable Store Sales, and Increases Earnings Guidance
ST. LOUIS--(BUSINESS WIRE)--April 7, 2005--Build-A-Bear Workshop, Inc.
(NYSE: BBW):
-- First quarter earnings guidance increased to $0.38 to $0.40 per
diluted share representing net income growth of 43% to 51%; previous
guidance for diluted EPS was $0.32 to $0.34. Guidance includes $0.02
per diluted share for flagship store pre-opening costs.
-- First quarter preliminary net retail sales increased 23.4% to $85.7
million -- comp store sales grew 5.4%, in-line with company guidance
for growth of 5% to 7%.
-- Second quarter earnings guidance remains $0.23 to $0.25 per diluted
share and includes $0.03 per diluted share for flagship store
pre-opening costs.
-- Full-year earnings guidance increased to $1.35 to $1.41 per diluted
share, from previous guidance of $1.29 to $1.35, reflecting the
improved first quarter outlook. Guidance includes $0.05 per diluted
share for flagship store pre-opening costs.
Build-A-Bear Workshop, Inc. (NYSE: BBW), an interactive, entertainment
retailer of customized stuffed animals, announced preliminary net retail sales
and comparable store sales for the fiscal 2005 first quarter, and increased
earnings guidance for the first quarter and full year.
Fiscal 2005 first quarter (13 weeks ended April 2, 2005) preliminary net
retail sales increased 23.4% to $85.7 million compared to $69.5 million in the
year ago first quarter (13 weeks ended April 3, 2004). Comparable store sales
grew 5.4% in the fiscal 2005 first quarter compared to 14.8% in the year ago
first quarter.
The company now expects fiscal 2005 first quarter earnings in the range of
$0.38 to $0.40 per diluted share, representing net income growth of 43% to 51%
compared to first quarter 2004, and an increase from previous guidance for
diluted earnings per share (EPS) of $0.32 to $0.34.
"We are very pleased with our first quarter sales performance," said
Chairman and Chief Executive Bear Maxine Clark. "We delivered strong sales
growth in our first quarter on top of an outstanding first quarter last year.
More importantly, we increased our bottom-line profitability resulting in higher
earnings expectations for the first quarter.
We continue to take the Build-A-Bear Workshop experience to wherever
families go to have fun via our On Tour mobile workshop and baseball park
locations. During the first quarter the mobile workshop attended events at the
NFL Experience at Superbowl XXXIX, the NBA All-Star Jam Session and regional
events such as the Miami Dade County Fair. The mobile workshop will attend over
25 events throughout the year. And, this month we will reopen our Build Your Own
Phanatic(TM) store at Citizens Bank Park(TM) in Philadelphia and launch two new
ballpark stores -- Great American Ballpark(TM) in Cincinnati and Jacobs
Field(TM) in Cleveland."
"We are confident that our unique retail entertainment concept and brand
experience combined with our strong store economic model can continue to drive
consistent growth and improvement in earnings," added Clark.
Beginning in February 2005, the company began to lap the start of its
national television advertising campaign. Sales in the 2004 first quarter
benefited from the company being featured in one segment of a nationally
syndicated television show. Sales in the 2005 first quarter benefited from a
shift in the Easter holiday from the second quarter in fiscal 2004 to the first
quarter in 2005.
During 2005 the company plans to open a flagship store in New York City.
Estimated flagship store pre-opening costs of approximately $1.7 million pretax,
or $0.05 per diluted share, are significantly higher than for a typical store
and are included in the fiscal 2005 earnings guidance.
Management now expects fiscal 2005 first quarter net income in the range of
$7.6 million to $8.0 million and diluted EPS in the range of $0.38 to $0.40 on
20.1 million diluted shares outstanding. This updated earnings guidance reflects
better than expected operating margin performance and includes flagship store
pre-opening costs of approximately $0.6 million pretax or $0.02 per diluted
share. Previous guidance for net income was in the range of $6.4 million to $6.8
million and for diluted EPS in the range of $0.32 to $0.34. Expected results for
the 2005 first quarter compare to 2004 first quarter diluted EPS of $0.30 on
17.9 million diluted shares outstanding.
Expectations for the second quarter (13 weeks ended July 2, 2005) are
unchanged with net income in the range of $4.7 million to $5.1 million and
diluted EPS in the range of $0.23 to $0.25 on 20.3 million diluted shares
outstanding. These expected results include flagship store pre-opening costs of
approximately $1.1 million pretax or $0.03 per diluted share. Comparable store
sales growth is expected to be in the range of 2% to 3% in the second quarter.
These expected results compare to fiscal 2004 second quarter net income of $4.9
million and diluted EPS of $0.27 on 18.0 million diluted shares outstanding.
2004 second quarter included the Easter holiday.
2005 full-year (52 weeks ended Dec. 31, 2005) earnings guidance increased
to $1.35 to $1.41 per diluted share, from previous guidance of $1.29 to $1.35
per diluted share, reflecting the improved first quarter earnings outlook. The
company now expects net income in the range of $27.3 million to $28.5 million,
representing net income growth of 37% to 43% compared to fiscal 2004. These
expected results include flagship store pre-opening costs of approximately $1.7
million pretax or $0.05 per diluted share. Comparable store sales growth is
expected to be approximately 3% for the full year.
During the 2005 first quarter, the company opened three new Build-A-Bear
Workshop (BABW) retail stores in the United States and Canada, as planned. This
compares to opening one new BABW store during the 2004 first quarter. These new
stores bring the total number of BABW stores to 167 in the United States and six
in Canada. During the quarter the international franchisees opened no new
international stores; international stores totaled 12 at the end of the first
quarter.
Other News
Build-A-Bear Workshop expects to open 28 to 30 new BABW stores in the
United States and Canada, including a flagship store in New York City, in fiscal
2005. Plans also include opening three new friends 2B made stores. Twelve of the
28 to 30 new stores are planned to open in the second quarter. International
franchisees expect to open 15 to 20 new stores in fiscal 2005.
On March 28, 2005, the company signed a franchise agreement to open
Build-A-Bear Workshop stores in the Netherlands, Belgium and Luxembourg (Benelux
countries). This agreement brings the total number of international countries
with franchise agreements to eleven. Those countries include Australia, Belgium,
Denmark, France, Japan, Luxembourg, the Netherlands, the Republic of China
(Taiwan), South Korea, Sweden and the United Kingdom.
"The Benelux countries are a great addition to our international franchise
program," said President and Chief Operating Officer Bear Barry Erdos. "We are
also pleased to announce that our French franchisee will open the first store in
Paris in the Galeries Lafayette, France's premier department store. This will be
the first store-within-a-store arrangement for Build-A-Bear Workshop and is
scheduled to open in May 2005."
The company will host its annual meeting of stockholders in St. Louis,
Missouri, at the Magic House, St. Louis Children's Museum, 516 S. Kirkwood Road,
St. Louis, Missouri, on Thursday, May 12, 2005, at 10:00 a.m. CDT.
About Build-A-Bear Workshop, Inc.
Build-A-Bear Workshop, Inc. (NYSE: BBW), with fiscal 2004 total revenue of
$302 million, is the only national company that offers Guests an interactive
make-your-own-stuffed animal retail-entertainment experience. The first store
opened in St. Louis in 1997; at the end of 2004 the company operated 170 stores
in 40 states and Canada. With the opening of its store in Sheffield, England, in
the fall of 2003 and the addition of international stores in Japan, Denmark and
Australia in 2004, Build-A-Bear Workshop(R) has become the global leader in the
teddy bear business. In November 2004, the company opened two friends 2B made(R)
stores, the newest concept based on the doll-making experience. For more
information about the company and its products, call 888.560.BEAR (2327) or
visit the company's award-winning Web site at www.buildabear.com.
Forward-Looking Statements
Statements in this news release expressing or indicating the beliefs and
expectations of management regarding future performance are forward-looking
statements including, without limitation, expected diluted earnings per share in
the fiscal 2005 first quarter, second quarter and full year, as well as, any
other plans, objectives, expectations and intentions contained in this release
that are not historical facts. These statements reflect our current views with
respect to future events and are based on assumptions and subject to risks and
uncertainties. These risks and uncertainties include, without limitation, those
detailed in our 2004 annual report on Form 10-K filed with the SEC on March 29,
2005, under the caption "Risk Factors" and the following: (1) we may be unable
to maintain our current comparable store sales growth; (2) our marketing
initiatives may not be effective in generating sufficient levels of brand
awareness and guest traffic; (3) we may be unable open new stores to effectively
manage our growth; (4) we may be unable to effectively manage our international
franchises or laws relating to those franchises may change; (5) 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; (6) customer
traffic may decrease in the shopping malls where we are located, on which we
depend to attract guests to our stores; (7) general economic conditions may
deteriorate, which could lead to reduced consumer demand for our products; (8)
our market share could be adversely affected by a significant number of
competitors; (9) we may lose key personnel, be unable to hire qualified
additional personnel, or experience turnover of our management team; (10) the
ability of our principal vendors to deliver merchandise may be disrupted; (11)
the availability and costs of our products could be adversely affected by risks
associated with international manufacturing and trade; (12) third parties that
manage our warehousing and distribution functions may perform poorly; (13) we
may fail to renew, register or otherwise protect our trademarks or other
intellectual property; (14) we may have disputes with, or be sued by, third
parties for infringement or misappropriation of their proprietary rights; (15)
we may be unable to renew or replace our store leases, or enter into leases for
new stores on favorable terms, or may violate the terms of our current leases;
(16) we may experience failures in our communications or information systems;
(17) terrorism or the uncertainty of future terrorist attacks or war could
reduce consumer confidence and mall traffic; (18) we may become subject to
challenges relating to overtime pay or other regulations relating to our
employees; (19) we may suffer negative publicity or be sued due to violations of
labor laws or unethical practices by manufacturers of our merchandise, and (20)
we may improperly obtain or be unable to protect information from our guests in
violation of privacy or security laws or expectations.
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. We do not undertake any obligation or plan to update
these forward-looking statements, even though our situation may change.
CONTACT: Build-A-Bear Workshop, Inc.
Investors:
Molly Salky, 314-423-8000, ext. 5353
or
Media:
Jill Saunders, 314-423-8000, ext. 5293
www.buildabear.com