CLAIRE'S STORES ANNOUNCES SECOND QUARTER RESULTS
PEMBROKE PINES, Florida, August 17, 2000 - Claire's Stores, Inc. (NYSE:CLE)
today announced sales and earnings for the second quarter of Fiscal 2001, which
ended July 29, 2000.
Net sales for the second quarter increased 35 percent to $251,982,000
compared with $186,090,000 for the second quarter of last year. Same store
sales for the second quarter decreased 1 percent on a consolidated basis
compared with an increase of 9 percent last year. The fashion accessory
division decreased 2 percent while Mr. Rags increased 5 percent on a same store
sales basis.
Net income decreased 16 percent in the second quarter to $17,112,000
compared with $20,320,000 last year. Diluted earnings per share from continuing
operations (which excludes prior year's gain on investment of $3,929,000, or
$0.05 per diluted share) to $0.34 versus $0.35 for the comparable quarter in the
prior year.
Rowland Schaefer, Claire's Chairman and Chief Executive Officer, said,
"Sales for the second quarter of fiscal 2001 increased 35% to $252 million
compared with $186 million last year. The increase in sales was due to a larger
store base with 3,055 stores this year compared with 2,151 stores at the end of
the second quarter last year. The second quarter was a challenging period for
us, as it was for many retailers. We continue to be disappointed with the same
store sales trends which resulted in lower earnings than the prior year on a
consolidated basis. Afterthoughts stores sales are not included in our same
store sales results until December of this year.
The lack of strength in our sales is primarily in North America, and was
due to a combination of issues. The organizational changes we have made have
impacted our performance and resulted in softer sales in that subsidiary.
Challenges individual to our business included the final steps of the
integration of Claire's and Afterthoughts as well as the conversion to the new
payroll, POS hardware in the stores as well as MMS allocation and Arthur
planning systems. There also was a general slow down in mall traffic which hurt
all retailers. On a more positive note, our sales trend continued to strengthen
each week throughout the last quarter. Marty will further elaborate on these
issues later in the call. We are cautiously optimistic as we head into
important back to school and holiday selling season and feel we are well
positioned." Mr. Schaefer added.
Mr. Schaefer also noted that at the end of the second quarter we had a
total of 3,055 stores in operation. These comprised 1,591 Claire's Accessories
in North America, 801 Afterthoughts which includes the Icing Stores, 315
Claire's Accessories stores in Claire's U.K., 91 stores in Japan, 101 stores in
Europe, Mr. Rags had 153 stores and 3 Velvet Pixies. We have opened 230 new
stores so far this fiscal year with an additional 62 new stores to be opened in
the 4th quarter.
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The Company will host a conference call for the second quarter of fiscal
2001 on August 17, at 10:00 a.m. (EST). The call in number is 888-677-5721 and
the password is Claire's. A replay will be available through Monday August
25th. The replay number is 888-568-0013 and the password is 25247. The call
may be accessed over the Internet through the Company's web site at
www.clairestores.com. To listen via the Internet, please access the web site at
least 15 minutes prior to the call to ensure your computer contains the proper
software. A replay of the conference call will also be available over
the Internet at both sites.
Claire's Stores, Inc., the leading mall-based retailer of popular-priced
pre-teen and teens accessories, costume jewelry and apparel, currently operates
approximately 3,055 stores under the following trade names: Claire's
Accessories, Afterthoughts, the Icing, Mr. Rags and Velvet Pixies. The stores
are located throughout North America, Japan, United Kingdom, Ireland,
Switzerland, Austria, Germany and France.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995: This release contains "forward-looking statements" which represent the
Company's expectations or beliefs with respect to future events. These
forward-looking statements are subject to certain risks and uncertainties that
could cause actual results to differ materially from those anticipated. Those
factors include, without limitation, changes in consumer preferences for
pre-teen and teen apparel and accessories, competition, and economic conditions
in North America, Europe, United Kingdom and Japan.
For additional information at Claire's Stores, Inc.:
Sonia Rohan
Director of Investor Relations
Phone: (212) 594-3127
Fax: (212) 244-4237
E-mail: [email protected]
Note: Other Claire's Stores, Inc. press releases, a corporate profile and most
recent 10-K and
10-Q reports are available by fax at no charge. For a menu of available
material, call 1-800-CLENYSE (1-800-253-6973) or via Claire's Internet home
page: http://www.clairestores.com.
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<CAPTION>
CLAIRE'S STORES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<BTB>
THREE MONTHS ENDED SIX MONTHS ENDED
----------------------------------- ----------------------------------
JULY 29,2000 JULY 31, 1999 JULY 29,2000 JULY 31, 1999
------------ ------------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net sales $251,982,000 100.0% $186,090,000 100.0% $483,982,000 100.0% $356,753,000 100.0%
Cost of sales,
Occupancy and buying
expenses 125,051,000 49.6% 91,603,000 49.2% 253,446,000 52.4% 176,596,000 49.5%
------------ ------------ ------------ ------------
126,931,000 50.4% 94,487,000 50.8% 230,536,000 47.6% 180,157,000 50.5%
------------ ------------ ------------ ------------
Expenses:
Selling, general &
administrative 86,920,000 34.5% 61,285,000 32.9% 171,711,000 35.5% 120,396,000 33.7%
Depreciation and
amortization 11,164,000 4.4% 6,434,000 3.5% 21,706,000 4.5% 12,723,000 3.6%
Interest expense
(income), net 2,401,000 1.0% (1,358,000) -0.7% 4,343,000 0.9% (2,992,000) -0.8%
Gain on investments - (3,929,000) -2.1% - (3,929,000) -1.1%
------------ ------------ ------------ ------------
100,485,000 39.9% 62,432,000 33.5% 197,760,000 40.9% 126,198,000 35.4%
------------ ------------ ------------ ------------
Income before income
taxes 26,446,000 10.5% 32,055,000 17.2% 32,776,000 6.8% 53,959,000 15.1%
Income taxes 9,334,000 3.7% 11,735,000 6.3% 11,671,000 2.4% 19,839,000 5.6%
------------ ------------ ------------ ------------
Net income $ 17,112,000 6.8% $ 20,320,000 10.9% $ 21,105,000 4.4% $ 34,120,000 9.6%
============ ============ ============ ============
Net income per
share:
Basic $ 0.34 $ 0.40 $ 0.42 $ 0.67
============ ============ ============ ============
Diluted $ 0.34 $ 0.40 $ 0.41 $ 0.66
============ ============ ============ ============
Weighted avg shares
outstanding:
Basic 50,299,000 50,932,000 50,719,000 50,893,000
============ ============ ============ ============
Diluted 50,524,000 51,419,000 50,925,000 51,376,000
============ ============ ============ ============
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