Total Sales for fourth quarter increase 7.2%;
Company reports accounting changes/refinements;
Total 2006 sales expected to increase 8.5% over fiscal 2005;
IRVING, Texas, Feb. 2 /PRNewswire-FirstCall/ -- Michaels Stores, Inc.
(NYSE: MIK) reported today that total sales for the fourth quarter were $1.270
billion, a 7.2% increase over last year's fourth quarter sales of $1.185
billion. Same-store sales for the quarter increased 2.4% on a 2.2% increase
in average ticket and a 0.2% increase in transactions. Fiscal 2005 sales of
$3.676 billion increased 8.3% from $3.393 billion in fiscal 2004. Same-store
sales for fiscal 2005 were up 3.6% over fiscal 2004 on a 0.5% increase in
transactions, a 2.7% increase in average ticket, and a 0.4% increase in custom
frame deliveries. A favorable Canadian currency translation added
approximately 0.2% to the average ticket increase for the fourth quarter and
approximately 0.4% for the fiscal year.
Michaels stores' domestic same-store sales for the fourth quarter were
strongest in the Southeast, Southwest, and Pacific regions of the country.
The best performing categories included Jewelry & Beads, Candles & Bakeware,
Kids Crafts, Art, and Frames.
Continued Performance Improvement
Michael Rouleau, President and Chief Executive Officer, said, "Overall, we
are pleased with our performance for the fourth quarter. We were able to
generate a comparable store sales increase of 2.4% on top of last year's 6.7%
increase, despite the softening demand for yarn. A number of categories,
including Jewelry & Beads, Bakeware, and Kids Crafts performed very well on
continued solid consumer demand, our strong merchandise offerings, and our
effective marketing during the quarter."
Mr. Rouleau also stated, "Consumers shopped late during this competitive
holiday season, with several events negatively impacting our gross margin
performance during the fourth quarter. These included a more promotional
pricing environment over the Thanksgiving weekend and later sell-through on
our Christmas seasonal merchandise. In addition, we took earlier markdowns on
our planned 2006 merchandise resets and we accelerated the clearance of
certain fashion yarns. However, with solid cost control efforts during the
quarter, we were able to partially offset some of these fourth quarter gross
margin issues."
Mr. Rouleau continued, "As a result of our successful sell down of
Christmas merchandise, the re-assortment in fashion yarn, and improved
utilization of our inventory management systems, we enter fiscal 2006 in an
excellent inventory position. Our overall inventory quality is very good and
our average inventory per store is down an estimated 2% versus the prior year,
on top of our fiscal 2004 reduction of 3% versus fiscal 2003. Also, many of
our 2005 merchandise reset categories, including Frames, Floral, Jewelry &
Beads, Seasonal, Kids Crafts, and Apparel Crafts demonstrated appreciable
growth in January as we finished the year. We have exciting merchandise
resets planned for next year, which should further accelerate our sales
performance."
Mr. Rouleau concluded, "We expect fiscal 2005 to be our ninth year of
record operating results with industry leading financial returns. We also
believe we are extremely well-positioned to expand our market share during
fiscal 2006. We enter the year with an aggressive store opening, relocation
and remodel program, a very strong management team, an effective
infrastructure and a strong focus on enhancing our merchandise offerings.
However, we do expect a softening of consumer interest in fashion yarn to
dampen comparable store sales during the first quarter of fiscal 2006, with a
more limited impact expected in the second quarter. Importantly, our
financial condition is strong; we are forecasting to end fiscal 2005 with over
$400 million in cash and short-term investments and no debt after returning
over $235 million to shareholders in the form of share repurchases and
dividends and expending $209 million to redeem our Senior Notes ahead of
schedule during the year. We are confident in our direction and believe we
are well-positioned to deliver our tenth consecutive year of record operating
performance in fiscal 2006."
Accounting Changes
Transition to Cost Accounting
As indicated on November 22, 2005, the Company has changed its method of
accounting for merchandise inventories from its prior retail inventory method
to the weighted average cost method to provide greater visibility to our cost
of sales and enable better analysis of our business performance. The weighted
average cost method utilizes the Company's newly available perpetual inventory
records to value inventories at the lower of cost or market on a store-level
by SKU basis.
With the adoption of the weighted average cost method of accounting for
inventory in the fourth quarter, the cumulative effect of the change in
accounting principle will be recorded as of the beginning of fiscal 2005. The
Company currently estimates that inventory balances as of the beginning of
fiscal 2005 will be approximately $798 million on the weighted average cost
method; approximately $138 million lower than the inventory balance reported
under the Company's retail inventory method. The cumulative effect of this
change in accounting on the opening fiscal 2005 financial statements is
currently estimated at approximately $86 million after-tax, or approximately
$0.62 per diluted share, and will be reflected in the first quarter of 2005.
The non-cash reduction in the inventory balance is due to the change in
accounting principle and is not an indication of an inventory impairment as
the underlying retail value of the Company's inventories is not affected by
this accounting change.
The change in the Company's accounting method for merchandise inventory
will also impact cost of goods sold for fiscal 2005. Cost of goods sold under
the weighted average cost method is expected to be approximately $15 million
higher on a pre-tax basis than under the retail inventory method, or
approximately $0.07 per diluted share on an after-tax basis. Although the
estimated annual impact on cost of goods sold under the weighted average cost
method related to the Company's retail method is minimal, the estimated
quarterly variations are more significant due to the averaging convention
inherent in the retail inventory method. Preliminary pro forma annual and
quarterly amounts for fiscal 2005 are included on Supplemental Schedule I.
The impact of this accounting change will be reflected in the Company's
results of operations reported in its year-end earnings press release and
Annual Report on Form 10-K. Pro Forma information comparing both methods will
also be presented in the year-end earnings release and Annual Report on Form
10-K.
Adoption of SFAS No. 123(R)
The Company has also elected to early adopt SFAS No. 123(R), Share-Based
Payments, in the fourth quarter of fiscal 2005. This accounting standard
requires all share-based payments to employees, including grants of employee
stock options, to be recognized in the financial statements based on their
fair value over the requisite service period. The Company will apply the
provisions of the modified retrospective transition method as permitted by
SFAS No. 123(R) from the beginning of fiscal 2005. As a result, the Company
will record compensation expense for unvested awards based on the amounts
previously determined for pro forma disclosure under SFAS No. 123, Accounting
for Stock-Based Compensation, for the first three quarters of fiscal 2005.
The Company is expecting to record compensation expense related to share-based
payments totaling approximately $29 million on a pre-tax basis, or $0.13 per
diluted share on an after-tax basis, for fiscal 2005. The preliminary pro
forma annual and quarterly adjustments required for fiscal 2005 are included
on Supplemental Schedule I.
Refinement of Cost Deferral and Entitlement Recognition
As a result of the Company's reviews and analyses related to its
transition to cost accounting, the Company has made certain refinements to its
calculation for deferring costs related to preparing inventory for sale ("cost
deferral") and for vendor allowance ("entitlement") recognition. The Company
currently expects to implement these refinements by recording a non-cash,
cumulative adjustment in the fourth quarter of fiscal 2005 of approximately
$12.5 million ($7.8 million net of tax), or $0.06 per diluted share on an
after-tax basis, related to prior years, and will record an estimated
incremental charge of $10.5 million ($6.5 million net of tax), or $0.05 per
diluted share on an after-tax basis, related to fiscal 2005. Of the $0.06
reduction in diluted earnings per share related to prior years, we estimate
that no amounts are attributable to fiscal 2004, approximately $0.01 is
attributable to fiscal 2003, and the remaining $0.05 is attributable to
periods prior to fiscal 2003. Of the $0.05 diluted earnings per share related
to fiscal 2005, we estimate that $0.03 relates to the fourth quarter, $0.01 is
attributable to the third quarter and $0.01 is attributable to the second
quarter. Currently, the Company expects to record the total cumulative
adjustment of $23.0 million, or $0.10 per diluted share on an after-tax basis,
in the fourth quarter of fiscal 2005. All amounts presented are preliminary
and may change significantly. The estimated effects of these refinements are
reflected as a fourth quarter item in Supplemental Schedule I.
Business Outlook
Estimated Fiscal 2005 Results
Fiscal 2005 results will be reported using the weighted average cost
method of accounting for inventory, including the impact of expensing stock
options under SFAS No. 123(R) and reflecting the accounting refinements for
cost deferrals and entitlements. Fiscal 2005 diluted earnings per share
before cumulative effect of accounting change is currently estimated to be
approximately $1.50. Fiscal 2005 diluted earnings per share after the
cumulative effect of accounting change is estimated to be approximately $0.88.
Fourth quarter fiscal 2005 diluted earnings per share is expected to be
approximately $0.82.
Due to the significant accounting changes and refinements (the "accounting
items") reflected in estimated fourth quarter and estimated full year fiscal
2005 results, the Company believes it is appropriate and helpful to investors
and stockholders to exclude these items for comparison of estimated fiscal
2005 results with fiscal 2004 results in order to provide an appropriate
indication of the underlying operational performance of the Company in fiscal
2005. Supplemental Schedule I sets forth reconciliations of estimated pro
forma fiscal 2005 results, excluding the accounting items, with estimated 2005
results on a GAAP basis. Supplemental Schedule II also provides a comparison
of fiscal 2005 to fiscal 2004 operating results as reported and to our
projected 2006 operating results. Supplemental Schedule III provides a
comparison of fourth quarter fiscal 2005 to fourth quarter 2004 operating
results as reported.
For the fourth quarter of fiscal 2005, diluted earnings per share
excluding accounting items, ("Pro Forma Diluted Earnings per Share"), for the
quarter is expected to be approximately $0.85, consistent with previous
guidance ranging from $0.83 to $0.87. This would represent an increase of
approximately 13% over the prior year fourth quarter diluted earnings per
share of $0.75. For fiscal 2005, Pro Forma Diluted Earnings per Share for
fiscal 2005 is estimated at $1.80, representing growth of approximately 24%
over fiscal 2004 diluted earnings per share of $1.45.
Note that fiscal 2005 annual and fourth quarter amounts are estimates and
may change significantly as the Company completes its fiscal year-end
financial reporting process.
Fiscal 2006 Outlook
Fiscal 2006 results will be reported using the weighted average cost
method of accounting for merchandise inventory and will reflect stock option
expense consistent with fiscal 2005 reporting. Note that the Company uses the
4-5-4 weekly calendar convention to report results and that fiscal 2006
represents a 53-week year for the Company.
Total sales for fiscal 2006 are expected to increase by 8.5% over fiscal
2005 driven by a forecasted comparable store sales increase of approximately
3%, new store sales growth of 4%, and an estimated 1.5% increase for the
additional week of business in fiscal 2006. Additionally, comparable store
sales are expected to accelerate throughout fiscal 2006. Comparable store
sales are expected to be flat to up 1% in the first quarter, to increase 2% to
3% in the second quarter, to be up 3% to 4% in the third quarter, and to
increase approximately 4% in the fourth quarter of fiscal 2006.
For fiscal 2006, the Company expects operating margin to expand
approximately 150 to 170 basis points over the fiscal 2005 estimated operating
margin of approximately 9.5%, driven by both gross margin expansion and
selling, general and administrative expense leverage. Operating income is
expected to range from $435 to $445 million, an increase of approximately 26%
to 29% over estimated 2005 operating income of approximately $346 million.
Net income for 2006 is estimated to range from $275 to $285 million, a 32% to
37% increase over estimated fiscal 2005 net income before the cumulative
effect of accounting change of $208 million. Diluted earnings per share is
currently expected to range from $2.00 to $2.05, representing a 33% to 37%
increase over the estimated comparable fiscal 2005 diluted earnings per share
of approximately $1.50 before the cumulative effect of accounting change.
Other Matters
The Company also announced that it has repurchased 2,102,700 shares of the
Company's common stock during the fourth quarter of fiscal 2005 at an average
price, including commissions, of $33.91 per share. In fiscal 2005, the
Company has repurchased 5,415,397 shares at an average price, including
commissions, of $35.16 for a total cost in excess of $190 million. As of
February 2, 2006, under its repurchase plans, the Company is authorized to
repurchase approximately 4.5 million additional shares plus such shares as may
be repurchased with proceeds from the future exercise of options outstanding
under its 2001 General Stock Option Plan.
The Company will host a conference call today, February 2, 2006 at 4:00
p.m. CT to discuss its sales results and accounting changes and refinements.
Those who wish to participate in the call may do so by dialing 888-889-5602.
Any interested party will also have the opportunity to access the call via the
Internet at http://www.michaels.com. To listen to the live call, please go to the
website at least fifteen minutes early to register and download any necessary
audio software. For those who cannot listen to the live broadcast, a
recording will be available for 30 days after the date of the event.
Recordings may be accessed at http://www.michaels.com or by phone at 877-519-4471,
PIN 7000163.
The Company also plans to release its fourth quarter and full year fiscal
2005 earnings results and its outlook for fiscal 2006 on Wednesday, March 8,
2006, and will conduct a conference call at 4:00 p.m. CT on that date, hosted
by Michaels Stores President and CEO, Michael Rouleau, and Executive Vice
President and Chief Financial Officer, Jeffrey Boyer. Those who wish to
participate in the call may do so by dialing 973-633-6740. Any interested
party will also have the opportunity to access the call via the Internet at
http://www.michaels.com. To listen to the live call, please go to the website at
least fifteen minutes early to register and download any necessary audio
software. For those who cannot listen to the live broadcast, a recording will
be available for 30 days after the date of the event. Recordings may be
accessed at http://www.michaels.com or by phone at 973-341-3080, PIN 5446636.
Michaels Stores, Inc. is the world's largest specialty retailer of arts,
crafts, framing, floral, wall decor, and seasonal merchandise for the hobbyist
and do-it-yourself home decorator. As of February 2, 2006, the Company owns
and operates 891 Michaels stores in 48 states and Canada, 166 Aaron Brothers
stores, 11 Recollections stores and four Star Wholesale operations.
This document may contain forward-looking statements that reflect our
plans, estimates, and beliefs. Any statements contained herein (including, but
not limited to, statements to the effect that Michaels or its management
"anticipates," "plans," "estimates," "expects," "believes," and other similar
expressions) that are not statements of historical fact should be considered
forward-looking statements and should be read in conjunction with our
consolidated financial statements and related notes in our Annual Report on
Form 10-K for the fiscal year ended January 29, 2005, and in our Quarterly
Reports on Form 10-Q for the quarters ended April 30, 2005, July 30, 2005 and
October 29, 2005. Specific examples of forward-looking statements include,
but are not limited to, forecasts of same-store sales growth, operating
income, cumulative effect of change in accounting principle, estimates of the
impact of the weighted average cost method of accounting for inventory
relative to our current retail inventory method, net income, and diluted
earnings per share. Our actual results could differ materially from those
discussed in these forward-looking statements. Factors that could cause or
contribute to such differences include, but are not limited to: our ability to
remain competitive in the areas of merchandise quality, price, breadth of
selection, customer service, and convenience; our ability to anticipate and/or
react to changes in customer demand; changes in consumer confidence;
unexpected consumer responses to promotional programs; unusual weather
conditions; the execution and management of our store growth and the
availability of acceptable real estate locations for new store openings; the
effective maintenance of our perpetual inventory and automated replenishment
systems and related impacts to inventory levels; delays in the receipt of
merchandise ordered from our suppliers due to delays in connection with either
the manufacture or shipment of such merchandise; transportation delays
(including dock strikes and other work stoppages); changes in political,
economic, and social conditions; commodity, energy and fuel cost increases,
currency fluctuations, and changes in import duties; our ability to maintain
the security of electronic and other confidential information; our ability to
establish effective internal controls over financial reporting for inventories
and cost of sales under our proposed weighted average cost method; financial
difficulties of any of our insurance providers, key vendors, or suppliers; and
other factors as set forth in our Annual Report on Form 10-K for the fiscal
year ended January 29, 2005, particularly in "Critical Accounting Policies and
Estimates" and "Risk Factors," and in our other Securities and Exchange
Commission filings. We intend these forward-looking statements to speak only
as of the time of this release and do not undertake to update or revise them
as more information becomes available.
This press release is also available on the Michaels Stores, Inc. website
(http://www.michaels.com).
Supplemental Schedule I
Michaels Stores, Inc.
Estimated Effect of Accounting Changes/Refinements - Quarter Detail
(Unaudited)
The Company's fiscal 2005 results will include the impact of the
transition to weighted average cost accounting, stock option expensing
under SFAS No. 123(R) and the refinement of inventory cost deferral and
entitlement recognition. Pro Forma Net Income - Retail Method Before
Accounting Items and its related Pro Forma Diluted Earnings per Share are
not measures of performance calculated in accordance with generally
accepted accounting principles ("GAAP"). Pro Forma Net Income - Retail
Method Before Accounting Items and Pro Forma Diluted Earnings per Share
should not be considered in isolation of, or as a substitute for, the GAAP
financial measures Net Income or Diluted Earnings per Share, respectively,
as indicators of the Company's performance.
The Company believes it is appropriate and helpful to investors and
stockholders to exclude the impact of the transition to weighted average
cost accounting, stock option expensing under SFAS No. 123(R) and the
refinement of inventory cost deferral and entitlement recognition for
comparison of (i) estimated fourth quarter of fiscal 2005 results with
fourth quarter of fiscal 2004 results and (ii) estimated fiscal 2005
results with fiscal 2004 results in order to provide investors with a view
of the Company's operating performance in a manner similar to the method
used by management to track operating performance from period to period
and improve an investor's ability to understand underlying trends in the
Company's operating performance in the fourth quarter and full year fiscal
2005.
As the Company uses Pro Forma Net Income - Retail Method Before Accounting
Items and its related Pro Forma Diluted Earnings per Share as measures of
performance in this sales release, the following table reconciles these
measures to Net Income and Diluted Earnings per Share, respectively, the
most directly comparable financial measures calculated and reported in
accordance with GAAP.
Note that the following tables may not foot or crosscast due to rounding
and differences in average weighted shares outstanding each period.
Fiscal 2005
Actual Actual Actual Estimated Estimated
Quarter Quarter Quarter Quarter Full Year
1 2 3 4 (1) (1)
(In millions, except per share data)
Pro forma net income -
Retail Method before
accounting items (2) $46.5 $30.8 $55.4 $116.6 $249.3
Pro forma diluted
earnings per share $0.33 $0.22 $0.40 $0.85 $1.80
Cost accounting adjustment -
net of tax 6.8 (12.8) (16.3) 13.2 (9.1)
Diluted earnings
per share 0.05 (0.09) (0.12) 0.10 (0.07)
SFAS No. 123(R) share-based
payment impact -
net of tax (2.8) (3.8) (8.0) (3.6) (18.2)
Diluted earnings
per share (0.02) (0.03) (0.06) (0.03) (0.13)
Refinement of cost deferral
and entitlement
recognition - net of tax - - - (14.3) (14.3)
Diluted earnings
per share - - - (0.10) (0.10)
Net income before
cumulative effect of
accounting change (3) 50.5 14.2 31.1 111.9 207.7
Diluted earnings
per share 0.36 0.10 0.23 0.82 1.50
Cumulative effect of
accounting change -
net of tax (3) (85.6) - - - (85.6)
Diluted Earnings
per Share (0.61) - - - (0.62)
Net income (loss) (3) $(35.1) $14.2 $31.1 $111.9 $122.1
Diluted earnings
per share $(0.25) $0.10 $0.23 $0.82 $0.88
(1) Quarter 4 and Full Year amounts are estimates and may change
significantly as the Company completes its year-end financial
reporting process.
(2) Represents the Company's previously reported results for Quarters 1
through 3 of fiscal 2005 and estimated Pro Forma Net Income using the
retail inventory method before accounting items.
(3) Represents quarterly and full year estimates of the Company's
operating results on a GAAP basis.
Supplemental Schedule II
Michaels Stores, Inc.
Estimated Effect of Accounting Changes/Refinements - Full Year
(Unaudited)
The Company's fiscal 2005 results will include the impact of the
transition to weighted average cost accounting, stock option expensing
under SFAS No. 123(R) and the refinement of inventory cost deferral and
entitlement recognition. Fiscal 2005 Retail Method (pro forma operating
results using the retail method before accounting items) and its related
diluted earnings per share are not measures of performance calculated in
accordance with generally accepted accounting principles ("GAAP"). Fiscal
2005 Retail Method should not be considered in isolation of, or as a
substitute for, the Company's GAAP operating results (Fiscal 2005
Estimated Full Year) as indicators of the Company's performance.
The Company believes it is appropriate and helpful to investors and
stockholders to exclude the impact of the transition to weighted average
cost accounting, stock option expensing under SFAS No. 123(R) and the
refinement of inventory cost deferral and entitlement recognition for
comparison of operating results for fiscal years 2004 and 2005 in order to
provide investors with a view of the Company's operating performance in a
manner similar to the method used by management to track operating
performance from period to period and improve an investor's ability to
understand underlying trends in the Company's operating performance for
those fiscal years.
The Company provided results of operations under the Fiscal 2005 Retail
Method since it used this as a measure of operating performance in this
sales release. Therefore, the Company provides the following table to
reconcile these measures to estimated full year results of operations
calculated and reported in accordance with GAAP.
Note that the following tables may not foot or crosscast due to rounding
and differences in average weighted shares outstanding each period.
Fiscal
2004 Fiscal 2005 (1)
Cost SFAS Cost Estimated
Retail Retail Acctg 123(R) Deferral/ Full
Method Method Impact Impact Entitlements Year (3)
(2)
(In millions, except per share data)
Net sales $3,393 $3,676 $- $- $- $3,676
Cost of sales and
occupancy
expense 2,147 2,288 15 4 23 2,330
Selling, general
and administrative
and pre-opening
expense 907 974 - 26 - 1,000
Operating income 340 413 (15) (29) (23) 346
Interest and other
(income) and
expense, net 16 11 - - - 11
Provision for
income taxes 122 153 (6) (11) (9) 127
Net income before
cumulative effect
of accounting
change 202 249 (9) (18) (14) 208
Cumulative effect
of accounting
change -
net of tax - - 86 - - 86
Net income after
cumulative
effect of
accounting change $202 $249 $(95) $(18) $(14) $122
Diluted earnings
per share before
cumulative
effect of
accounting
change $1.45 $1.80 $(0.07) $(0.13) $(0.10) $1.50
Diluted earnings
per share
after cumulative
effect of
accounting
change $1.45 $1.80 $(0.68) $(0.13) $(0.10) $0.88
Fiscal 2006
Estimated
Full Year (4)
Net sales $3,988
Cost of sales and occupancy expense 2,493
Selling, general and administrative
and pre-opening expense 1,056
Operating income 439
Interest and other (income) and
expense, net (11)
Provision for income taxes 171
Net income before cumulative
effect of accounting change 279
Cumulative effect of accounting
change - net of tax -
Net income after cumulative
effect of accounting change $279
Diluted earnings per share before
cumulative effect of accounting change $2.02
Diluted earnings per share after
cumulative effect of accounting change $2.02
(1) Fiscal 2005 Full Year amounts are estimates and may change
significantly as the Company completes its year-end financial
reporting process.
(2) Represents the Company's estimated pro forma operating results using
the retail inventory method before accounting items.
(3) Represents full year estimates of the Company's fiscal 2005 operating
results on a GAAP basis.
(4) Represents full year estimates of the Company's fiscal 2006 operating
results on a GAAP basis using weighted average cost accounting and
including the impact of stock option expensing under SFAS No. 123(R).
Supplemental Schedule III
Michaels Stores, Inc.
Estimated Effect of Accounting Changes/Refinements - Quarter 4
(Unaudited)
The Company's fiscal 2005 results will include the impact of the
transition to weighted average cost accounting, stock option expensing
under SFAS No. 123(R) and the refinement of inventory cost deferral and
entitlement recognition. Quarter 4 Fiscal 2005 Retail Method (pro forma
operating results using the retail method before accounting items) and
its related diluted earnings per share are not measures of performance
calculated in accordance with generally accepted accounting principles
("GAAP"). Quarter 4 Fiscal 2005 Retail Method should not be considered
in isolation of, or as a substitute for, the Company's GAAP operating
results (Fiscal 2005 Estimated Quarter 4) as indicators of the Company's
performance.
The Company believes it is appropriate and helpful to investors and
stockholders to exclude the impact of the transition to weighted average
cost accounting, stock option expensing under SFAS No. 123(R) and the
refinement of inventory cost deferral and entitlement recognition for
comparison of operating results for the fourth quarter of fiscal years
2004 and 2005 in order to provide investors with a view of the Company's
operating performance in a manner similar to the method used by
management to track operating performance from period to period and
improve an investor's ability to understand underlying trends in the
Company's operating performance for those quarters.
The Company provided results of operations under the Quarter 4 Fiscal
2005 Retail Method since it used this as a measure of operating
performance in this sales release. Therefore, the Company provides the
following table to reconcile these measures to estimated fourth quarter
results of operations calculated and reported in accordance with GAAP.
Note that the following tables may not foot or crosscast due to rounding
and differences in average weighted shares outstanding each period.
Quarter 4
Fiscal
2004 Quarter 4, Fiscal 2005 (1)
Retail Retail Cost SFAS Cost
Method Method Acctg 123(R) Deferral/ Estimated
(2) Impact Impact Entitle- Quarter 4
ments (3)
(In millions, except per share data)
Net sales $1,185 $1,270 $- $- $- $1,270
Cost of sales and
occupancy
expense 752 797 (21) 1 23 800
Selling, general
and administrative
and pre-opening
expense 266 286 - 5 - 291
Operating income 167 186 21 (6) (23) 179
Interest and other
(income) and
expense, net 3 (2) - - - (2)
Provision for
income taxes 61 71 8 (2) (9) 69
Net income before
cumulative effect
of accounting
change 103 117 13 (4) (14) 112
Cumulative effect
of accounting
change - net
of tax - - - - - -
Net income after
cumulative effect
of accounting
change $103 $117 $13 $(4) $(14) $112
Diluted earnings
per share before
cumulative effect
of accounting
change $0.75 $0.85 $0.10 $(0.03) $(0.10) $0.82
Diluted earnings
per share after
cumulative effect
of accounting
change $0.75 $0.85 $0.10 $(0.03) $(0.10) $0.82
(1) Fiscal 2005 Quarter 4 amounts are estimates and may change
significantly as the Company completes its year-end financial
reporting process.
(2) Represents the Company's estimated pro forma operating results using
the retail inventory method before accounting items.
(3) Represents estimates of the Company's Quarter 4 fiscal 2005 operating
results on a GAAP basis.
SOURCE Michaels Stores, Inc.
 back to top
Related links:
http://www.michaels.com
Company News On-Call:
http://www.prnewswire.com/comp/115769.html
Photo Notes:http://www.newscom.com/cgi-bin/prnh/20040804/DAMICHAELSLOGO
AP Archive: http://photoarchive.ap.org PRN Photo Desk
photodesk@prnewswire.com
CONTACT:
Lisa K. Klinger, Vice President - Treasurer
and Investor Relations, +1-972-409-1528, klingerl@michaels.com
|
