- Fiscal 2003 Diluted EPS Increases 28% to $2.54 -
- Net Income Increases 27% -
IRVING, Texas, March 3 /PRNewswire-FirstCall/ -- Michaels Stores, Inc.
(NYSE: MIK) today reported financial results for its fiscal year 2003. Net
income before the cumulative effect of an accounting change increased
$30.1 million, or 20%, to a record $177.8 million versus last year's record
$147.7 million. Diluted earnings per share before the cumulative effect of an
accounting change increased $0.45, or 22%, to a record $2.54 per share versus
$2.09 per share in 2002. Net income after the cumulative effect of the change
in accounting increased $37.5 million or 27%. Diluted earnings per share
after the cumulative effect of the accounting change increased $0.55, or 28%,
from the $1.99 reported last year.
The Company's net income for the fourth quarter of 2003 increased
$19.2 million to $94.6 million, up 25% versus $75.4 million for the same
quarter last year. Diluted earnings per share increased $0.28, or 26%, for
the quarter to $1.35 in 2003 versus $1.07 in 2002.
Total sales for the year ended January 31, 2004 were $3.091 billion, an 8%
increase over the prior year. Same-store sales increased 2% for the year.
Total sales for the fourth quarter increased 9% to $1.063 billion. Same-store
sales for the fourth quarter increased 4%.
Michael Rouleau, Chief Executive Officer, said, "We are very pleased to
report our seventh consecutive year of record sales and earnings. Diluted
earnings per share in 2003 were $2.54, a 28% increase over last year's
reported number, and were driven by solid same-store sales growth, strong
expense controls, and a lower effective tax rate."
Rouleau continued, "Most importantly, we completed the implementation of
our very critical perpetual inventory system initiative. We also remain on
schedule to complete the installation of our automated replenishment system by
mid-year. These new systems will provide better tools and greater insights
into our business and will help accelerate same-store sales and expand margins
over the next several years."
He concluded, "We remain optimistic as we enter 2004. Our performance
strengthened during the fourth quarter of 2003 as same-store sales gained
momentum and earnings reached record levels. Given our significant progress
in 2003, we expect to deliver another record year in 2004 with same-store
sales growth accelerating 3% to 5% and diluted earnings per share increasing
at least 15%."
The Company will host a conference call at 4:00 p.m. CT today to discuss
February 2004 sales, Fourth Quarter and Fiscal Year 2003 earnings results, and
Fiscal 2004 outlook. 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 replay will be available for 30 days after the date of the
event. Replay may be accessed at http://www.michaels.com or by phone at
973-341-3080, PIN 4100059.
The Company plans to release its March 2004 sales results on Thursday,
April 8, 2004 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 retailer of arts, crafts,
framing, floral, wall decor, and seasonal merchandise for the hobbyist and do-
it-yourself home decorator. The Company owns and operates 809 Michaels stores
in 48 states and Canada, 158 Aaron Brothers stores, located primarily on the
West Coast, two ReCollections stores in the Dallas/Fort Worth Metroplex, and
two wholesale operations.
Certain statements contained herein which are not historical facts are
forward looking statements that involve risks and uncertainties, including,
but not limited to, estimation risks, customer demand and trends in the arts
and crafts industry, related inventory risks due to shifts in customer demand,
the effect of economic conditions, the impact of competitors' locations or
pricing, the availability of acceptable locations for new stores, difficulties
with respect to new information system technologies, supply constraints or
difficulties, the results of financing efforts, the effectiveness of
advertising strategies and other risks detailed in the Company's Securities
and Exchange Commission filings. The Company intends these forward-looking
statements to speak only as of the time of this release and does 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 ).
-- Tables Follow --
MICHAELS STORES, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands except per share data)
4th Quarter 12 Months YTD
2003 2002 2003 2002
Net sales $1,063,106 $971,960 $3,091,256 $2,856,373
Cost of sales and occupancy
expense 674,466 616,256 1,957,273 1,803,991
Gross profit 388,640 355,704 1,133,983 1,052,382
Selling, general, and
administrative expense 233,420 221,915 823,161 773,944
Store pre-opening costs 1,026 1,291 8,071 8,644
Operating income 154,194 132,498 302,751 269,794
Interest expense 5,077 5,177 20,262 21,074
Other (income) and expense, net (1,200) (459) (2,701) (1,669)
Income before income taxes
and cumulative effect of
accounting change 150,317 127,780 285,190 250,389
Provision for income taxes 55,756 52,390 107,345 102,659
Income before cumulative
effect of accounting change 94,561 75,390 177,845 147,730
Cumulative effect of accounting
change, net of tax --- --- --- 7,433
Net income $94,561 $75,390 $177,845 $140,297
Earnings per common share
before cumulative effect of
accounting change:
Basic $1.40 $1.12 $2.65 $2.22
Diluted $1.35 $1.07 $2.54 $2.09
Earnings per common share
after cumulative effect of
accounting change:
Basic $1.40 $1.12 $2.65 $2.11
Diluted $1.35 $1.07 $2.54 $1.99
Common shares used in per
share calculations:
Basic 67,644 67,448 67,178 66,648
Diluted 69,831 70,364 69,929 70,550
CONSOLIDATED BALANCE SHEETS
(In thousands except number of stores)
January 31, February 1,
2004 2003
Assets:
Cash and equivalents $341,825 $218,031
Merchandise inventories 892,923 809,418
Property and equipment 387,917 367,697
Goodwill, net 115,839 115,839
Deferred and prepaid income taxes 19,426 20,352
Other assets 43,717 29,636
$1,801,647 $1,560,973
Debt and Equity:
Trade payables $172,708 $94,764
Bank debt --- ---
Other liabilities 261,641 254,182
Senior notes due 2009 200,000 200,000
Stockholders' equity 1,167,298 1,012,027
$1,801,647 $1,560,973
Number of Michaels retail stores open (A) 805 755
Inventory per Michaels retail store (A) $1,045 $1,018
(A) Includes Village Crafts by Michaels stores
SOURCE Michaels Stores, Inc.
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Related links:
http://www.michaels.com
Company News On-Call:
http://www.prnewswire.com/comp/115769.html
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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