HINGHAM, Mass., July 22 /PRNewswire/ -- DM Management Company
Nasdaq: DMMC) today reported financial results for its second quarter ended
June 28, 1997.
"We are very pleased to have significantly improved earnings this quarter
while aggressively growing sales and active customer counts. The response to
our recent Spring catalogs was better than anticipated for both titles,
J. Jill and Nicole Summers. J. Jill's performance was particularly strong as
consumers continue to react positively to the catalog's uncomplicated
lifestyle offerings," commented Gordon R. Cooke, President and Chief Executive
Officer.
"Furthermore, we are encouraged that the strength seen in the spring
season has continued as initial response to our fall catalogs has been very
favorable," Cooke concluded.
QUARTER HIGHLIGHTS:
* Net sales increased 52% to $32.9 million from $21.6 million for the
second quarter of 1996.
* Operating income rose to $2.0 million, an increase of 200% over the
comparable period last year. As a percentage of net sales, operating income
increased to 6.0% from 3.1% in 1996.
* Net income before non-recurring items rose 121% over the prior year to
$1.2 million.
* Earnings per share before non-recurring items of $0.23 was 109% above
the $0.11 reported last year.
SIX MONTH HIGHLIGHTS:
* Net sales increased by $16.1 million or 39% to $57.4 million from
$41.3 million in the prior period.
* Operating income increased by 176% to $2.9 million versus $1.1 million.
* Net income before non-recurring items totaled $1.7 million as compared
to $0.8 million the prior year, an increase of 120%.
* Earnings per share before non-recurring items increased 106% to
$0.35 compared to $0.17 in the previous year.
During the quarter ended June 29, 1996, the Company made the decision to
discontinue its Carroll Reed catalog operations. Consequently, the prior year
results include a non-recurring charge of approximately $9.0 million related
to this decision.
DM Management is a specialty direct marketer of high quality women's
apparel, accessories, shoes, gifts and cosmetics. The Company markets its
products through two discrete catalog concepts, J. Jill and Nicole Summers.
Each of these catalogs targets mature, affluent women and is designed to
appeal to a distinct lifestyle within this demographic group.
This press release contains certain forward-looking statements with
respect to the future performance of DM Management that involve risks and
uncertainties. Various factors could cause the actual results of the Company
to be materially different from any future results expressed or implied by
such forward-looking statements. Such factors include, but are not limited
to, changes in consumer spending and preferences, general economic and
business conditions, increasing competition in the apparel industry, possible
future increases in operating costs, business abilities and judgment of
personnel, and other factors discussed in DM Management's filings with the
Securities and Exchange Commission.
DM MANAGEMENT
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
In thousands,
except per share Three Months Ended Six Months Ended
data - Unaudited June 28, 1997 June 29, 1996 June 28, 1997 June 29,
1996
Net sales $32,885 $21,582 $57,428 $41,318
Costs and expenses:
Product 14,563 9,507 25,415 17,769
Operations 5,912 3,701 10,213 7,092
Selling 7,822 6,201 14,136 11,997
General and
administrative 2,606 1,512 4,734 3,397
Operating income 1,982 661 2,930 1,063
Interest expense 7 55 68 179
Provision (benefit)
for income taxes 770 61 1,116 89
Net income before
non-recurring items 1,205 545 1,746 795
Loss from discontinued
operations (Note a) - (9,001) - (8,987)
Net income (loss) $1,205 ($8,456) $1,746 ($8,192)
Weighted average
shares outstanding 5,150 4,737 5,056 4,620
Earnings per share
before non-recurring
items $0.23 $0.11 $0.35 $0.17
Earnings per share $0.23 ($1.79) $0.35 ($1.77)
DM MANAGEMENT
CONDENSED CONSOLIDATED BALANCE SHEETS
In thousands June 28,1997 June 29, 1996
(Unaudited)
Assets:
Cash and marketable
securities $10,260 $4,079
Inventory 11,279 10,866
Prepaid catalog expenses 3,870 4,154
Deferred income taxes 2,670 -
Other current assets 779 1,098
Total current assets 28,858 20,197
Property and equipment, net 7,033 6,872
Deferred income taxes 7,928 -
Total assets $43,819 $27,069
Liabilities and
stockholders' equity:
Accounts payable
and accrued expenses $15,179 $12,320
Short-term debt 836 889
Long-term debt 4,446 4,380
Total liabilities 20,461 17,589
Capital stock, net 40,488 39,933
Unrealized loss on
marketable securities (122) (136)
Accumulated deficit (17,008) (30,317)
Total stockholders' equity 23,358 9,480
Total liabilities
and stockholders' equity $43,819 $27,069
Notes:
(a) Charges related to the discontinuation of the Company's Carroll Reed
operations. |
