CRMB is down 35% this morning. Their second quarter numbers, and their first report as a public company, appear to have been a major disappointment.
57th Street General Acquisition Corp., Owner of Crumbs Holdings LLC, Announces Second Quarter & Year-to-Date 2011 Financial Results
Raises 2011 Development Outlook
Reaffirms 200 Stores in Operation by Year-End 2014
Press Release
Source: 57th Street General Acquisition Corp. On Thursday August 11, 2011, 4:50 pm EDT
NEW YORK--(BUSINESS WIRE)-- 57th Street General Acquisition Corp. (the “Company”), owner of Crumbs Holdings LLC (“Crumbs”), a national neighborhood bakery and the largest U.S.-based retailer of cupcakes, today announced financial results for the second quarter and year-to-date periods ended June 30, 2011. The Company also raised its 2011 development outlook to 16-18 new store openings from 14-16, reaffirmed its commitment to have 200 stores in operation by year-end 2014 and provided a general financial outlook.
Second Quarter Highlights as Compared to Year Ago Period Include:
Net sales increased 30.1% to $10.3 million; gross profit increased 27.5% to $5.9 million. Store operating weeks increased 40.0% to 455 from 325. Comparable store sales decreased 6.0%. GAAP net loss before non-controlling interest of ($0.5 million), net loss attributable to stockholders of ($0.3 million) or ($0.05) per share, basic and diluted. Adjusted EBITDA, a non GAAP measure, of $0.1 million compared to $0.8 million (*). One new store opened in New York City.
Year-to-Date Highlights as Compared to Year Ago Period Include:
Net sales increased 33.1% to $20.0 million; gross profit increased 30.4% to $11.6 million. Store operating weeks increased 37.2% to 892 from 650. Comparable store sales decreased 2.1%. GAAP net loss before non-controlling interest of ($0.4 million), net loss attributable to stockholders of ($0.3 million) or ($0.05) per share, basic and diluted. Adjusted EBITDA of $0.6 million compared to $1.6 million (*). Two new stores opened, Newark Liberty Airport and New York City.
*See financial tables for a reconciliation of adjusted EBITDA (earnings before interest, taxes, depreciation and amortization), a non-GAAP measure, to GAAP results.
Jason Bauer, Co-Founder of Crumbs and CEO and President of the Company stated, “Second quarter growth in revenue and gross profit was driven by a significant increase in store operating weeks offset by softness in comparable store sales. The decline in comparable store sales was largely a function of our small store base and our intent to cannibalize several of our highest performing locations. For that reason, we continue to believe that total revenue growth, store operating week expansion, and store-level returns are a more accurate measure of our progress.” Bauer continued, “To that point, our unit-level economics and key metrics continue to justify our rapid expansion and we’re pleased to increase our development target for 2011 while reiterating our goal of 200 stores in operation by the end of 2014. Our new-found balance sheet strength is a true competitive advantage during this multi-year expansion phase, allowing us to invest in numerous initiatives that we believe will solidify our position as our country’s favorite neighborhood bakery and largest retailer of cupcakes.”
Second Quarter Financial Results
Net sales for the second quarter of 2011 increased 30.1% to $10.3 million from $7.9 million in the same period last year. Store operating weeks increased 40.0% to 455 from 325. Comparable store sales for the 25 stores in the comparable store base (67% of total stores) decreased 6.0% compared to the second quarter of 2010 due in part to deliberate cannibalization of several of the highest performing locations. Over the last 12 months, 13 more stores have been added to create an aggregate of 25 stores in the comparable store base.
Cost of sales increased 33.8% to $4.3 million from $3.2 million, and as a percentage of net sales, increased 116 basis points to 42.1% compared to the second quarter of 2010. Gross profit increased 27.5% to $5.9 million from $4.7 million compared to the second quarter of 2010 due to higher net sales.
General and administrative expenses were $0.7 million, or 6.3% of net sales, compared to $0.3 million in the same period last year, or 3.9% of net sales as the Company incurred higher professional fees and deal-related expenses related to the business combination agreement which closed in May.
Adjusted EBITDA was $0.1 million compared to $0.8 million in the same period last year. See financial tables for a reconciliation of adjusted EBITDA (earnings before interest, taxes, depreciation and amortization), a non-GAAP measure, to GAAP results.
GAAP net loss attributable to the controlling and non-controlling interests was ($0.5 million), compared to $0.5 million in the same period last year. Net loss attributable to stockholders was ($0.3 million), or ($0.05) per share, basic and diluted.
New Store Development
During the second quarter of 2011, the Company opened one store in New York City in midtown Manhattan. As of June 30, 2011, there were a total of 35 stores opened across six states and the District of Columbia.
Outlook
The Company raised its 2011 development outlook and now anticipates opening 16-18 stores compared to its original expectation of 14-16 new locations. All 2011 store openings are anticipated to be in existing markets. The Company also reaffirmed its commitment to have 200 stores opened by year-end 2014.
For 2011, the Company updated its financial outlook to the following:
Net sales are expected to be $40.0 - $45.0 million. Adjusted EBITDA is expected to be $0.85 million - $1.35 million (*).
For 2012, the Company’s preliminary outlook includes the following:
Net sales are expected to be $80.0 - $85.0 million. Adjusted EBITDA is expected to be $7.5 - $8.5 million (*).
*See financial tables for a reconciliation of the Company’s adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) guidance, a non-GAAP measure, to the Company’s outlook on a GAAP basis.
Conference Call
The Company will host a conference call to discuss second quarter 2011 financial results today at 5:00 PM Eastern Time. Hosting the call will be Jason Bauer, Co-Founder of Crumbs and CEO and President of the Company, and John D. (“Chuck”) Ireland, Chief Financial Officer. The conference call can be accessed live over the phone by dialing 877-857-6177 or 719-325-4901 for international callers. A replay will be available beginning one hour after the call and can be accessed by dialing 877-870-5176 or 858-384-5517 for international callers. The password is 4679497. The replay will be available until August 31, 2011.
The call will be webcast live from the Company’s Web site at crumbs.com under the Investor Relations section. An archived webcast will be available beginning approximately one hour after the end of the call.
<snip>
The actual financial statements can be found here:
finance.yahoo.com |
