IRVING, Texas, Aug. 4 /PRNewswire-FirstCall/ -- Michaels Stores, Inc.
(NYSE: MIK) reported today that total sales for the second quarter were
$745.5 million, a 9.2% increase over last year's $682.9 million. Same-store
sales for the quarter increased 4.2% on a 2.4% increase in average ticket, a
1.4% increase in transactions, and a 0.4% increase in custom frame deliveries.
Year-to-date sales of $1.567 billion increased 11.2% from $1.409 billion for
the same period last year. Same-store sales year-to-date were up 6.1% over
the same period a year ago on a 3.2% increase in transactions, a 2.4% increase
in average ticket, and a 0.5% increase in custom frame deliveries. A
favorable Canadian currency translation added approximately 0.4% to the
average ticket increase for the second quarter and for the first six months of
fiscal 2005.
Michael Rouleau, President and Chief Executive Officer, said, "We are
pleased with our solid same-store sales performance for the quarter, which
builds on our strong fiscal 2004 second quarter same-store sales increase of
5%. Higher in-stock positions, stronger sales of merchandise at regular
price, and continued improvement in store merchandising execution contributed
to our same-store sales results. Our overall strong performance for the
quarter was partially offset by the unfavorable impact on arts and crafts
activities due to more seasonal weather in certain parts of the country this
year relative to the second quarter of fiscal 2004, when the weather was
unseasonably cool and more conducive to indoor crafting activities. Our
domestic Michaels Stores' Pacific, Southwest and Southeast zones delivered
strong same-store sales performances during the second quarter of this year
with an average increase of approximately 6% versus the same period last year.
The more weather sensitive Northern, Mid-Atlantic, and Northeast zones
averaged a same-store sales increase of approximately 1% over the second
quarter of fiscal 2004. Strongest departmental performances came in our
Jewelry & Beading, Paper-crafting, Foam, and Yarn categories."
The Company continues to expect fiscal 2005 second quarter diluted
earnings per share to range from $0.20 to $0.22 versus diluted earnings per
share of $0.19 for the second quarter of 2004. Net income for the quarter is
expected to be driven by operating income growth of 25% to 30% over last year,
offset by the additional costs associated with the early redemption of its
Senior Notes, as previously announced. The Company continues to expect same-
store sales in the second half of fiscal 2005 to increase between 3% and 5%
over the same period last year, with third quarter sales near the low-end of
the estimated range and fourth quarter sales expected to be at the high-end of
the range. Consistent with prior guidance, the company continues to expect
growth in fiscal 2005 diluted earnings per share of 25% to 30% over last
year's $1.45.
The Company also announced that it has repurchased an additional 457,900
shares of the Company's common stock during the second quarter of fiscal 2005
under its stock repurchase plans at an average price of $41.10 per share.
Subsequent to the end of the quarter, the Company repurchased an additional
34,100 shares at an average price of $41.14 per share. As of August 4, 2005,
under its repurchase plans, the Company is authorized to repurchase
approximately 2.95 million additional shares plus such shares as may be
repurchased with proceeds from the future exercise of options under the
Company's 2001 General Stock Option Plan.
The Company plans to release its second quarter 2005 earnings results and
outlook for fiscal 2005 on Wednesday, August 24, 2005, 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 - 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 5446629.
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 August 3, 2005, the Company owns and
operates 870 Michaels stores in 48 states and Canada, 165 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
Report on Form 10-Q for the quarter ended April 30, 2005. Specific examples of
forward-looking statements include, but are not limited to, forecasts of same-
store sales growth, operating 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
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, currency fluctuations, and changes in import duties; our
ability to maintain the security of electronic and other confidential
information; 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 ).
SOURCE Michaels Stores, Inc.
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CONTACT:
investor relations, Lisa K. Klinger, Vice
President - Treasurer, +1-972-409-1528, or klingerl@michaels.com
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