- Same-Store Sales Increase 7% -
- Increases Fourth Quarter and Full Year EPS Guidance -
IRVING, Texas, Feb. 3 /PRNewswire-FirstCall/ -- Michaels Stores, Inc.
(NYSE: MIK) reported today that total sales for the month of January were
$244.2 million, a 12% increase over last year's $217.7 million. Same-store
sales for the month increased 7%. Total sales for the fourth quarter were
$1.185 billion, an 11% increase over last year's $1.063 billion, and same-
store sales for the fourth quarter increased 7%. Total sales for 2004 were
$3.393 billion, a 10% increase over last year's $3.091 billion. Same-store
sales for the year increased 5%.
For the month, customer traffic increased 6% and average ticket increased
4%. A custom frame promotion late in the month of January shifted additional
custom frame deliveries into February, reducing overall January same-store
sales by 3%. For the quarter, customer traffic increased 6% and average
ticket increased 2%. The shift of additional custom frame deliveries into
February reduced fourth quarter same-store sales by 1%. For the year,
customer traffic increased 4% and average ticket increased 1%. Strengthening
in the Canadian dollar from the prior year favorably affected the Company's
average ticket by approximately 30 basis points for January and for the year,
and approximately 40 basis points for the quarter.
Michael Rouleau, Chief Executive Officer, said, "We are very pleased with
our strong same-store sales performance in January, especially after an
impressive 14% same-store sales performance in December and in spite of
difficult weather throughout much of the country this month. For January, our
best performing regions were the Pacific, Northern and Southeast zones and our
best performing categories were Yarn, Custom Framing, Scrapbooking, Ready-Made
Frames, and Impulse. For the fourth quarter, our strongest regions were the
Pacific, Southeast, and Central zones and our strongest categories were Yarn,
Scrapbooking, Custom Framing, and Kids Crafts."
Rouleau concluded, "Fiscal 2004 will be our eighth straight year of record
sales and operating income. This is in large part due to our continued
efforts to enhance our merchandising capabilities through improvements to our
systems and processes as well as investments in our merchandising and
inventory management organizations. We successfully completed our most
important initiative ever this past June, the implementation of our automated
replenishment and perpetual inventory systems. With improved product
offerings, enhanced in-store merchandising, and higher inventory in-stock
levels during the fourth quarter, we are beginning to see the benefits of our
investments in our organization and systems but also feel that we have only
scratched the surface of what these systems can enable us to accomplish. We
look forward to realizing the full benefits of our investments in our systems,
processes and people over the next several years."
The Company now expects fourth quarter diluted earnings per share to range
from $.77 to $.78, an increase of approximately 15% over last year, driven by
strong same-store sales, incremental sales from new stores, and solid
expansion in operating margins for the quarter. Full year diluted earnings
per share are expected to range from $1.48 to $1.49, an increase of
approximately 17% over fiscal 2003 diluted EPS of $1.27, and inclusive of the
$4.9 million pre-tax charge in the second quarter for the establishment of
insurance reserves reflecting the financial difficulties of one of the
company's previous insurance carriers.
For fiscal year 2005, the Company expects diluted earnings per share to
increase by 15% to 20%, driven by a 3% to 5% same-store sale increase, 45 new
Michaels stores, and the continued expansion of operating margins.
The Company plans to release its fourth quarter and fiscal year 2004
earnings results on Wednesday, March 2, 2005, and will host a conference call
at 4:00 p.m. CT on that date to discuss them. 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 4758962.
Going forward, the Company will report sales performance on a quarterly
rather than monthly basis beginning with a report of its 2005 first quarter
sales on Thursday, May 5, 2005, at 6:30 a.m. CT. Any interested party may
view the Company's press release at http://www.michaels.com .
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 3, 2005, the Company owns
and operates 846 Michaels stores in 48 states and Canada, 165 Aaron Brothers
stores, eight Recollections stores, and three Star Wholesale operations.
This document contains 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 31, 2004, and in our Quarterly
Reports on Form 10-Q for the quarters ended May 1, 2004, July 31, 2004, and
October 30, 2004. Specific examples of forward-looking statements include,
but are not limited to, forecasts of same-store sales growth 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 changes in 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 cost increases and currency
fluctuations; 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 31, 2004, particularly in
"Critical Accounting Policies" 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 ).
SOURCE Michaels Stores, Inc.
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CONTACT:
Jeffrey N. Boyer, Executive Vice President -
Chief Financial Officer, +1-972-409-1581, or Christopher J.
Holland, Vice President - Finance, +1-972-409-1667, both of
Michaels Stores, Inc.
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