IRVING, Texas, Oct. 7 /PRNewswire-FirstCall/ -- Michaels Stores, Inc.
(NYSE: MIK) today reported that total sales for the month of September were
$314.4 million, a slight increase over total sales of $312.7 million for the
same period last year. Same-store sales for the month decreased 4%. Lower
custom frame deliveries reduced same-store sales by 3% for the month and were
affected primarily by changes in the timing of custom frame promotional events
during the third quarter relative to last year. For the month, customer
traffic was flat and average ticket was down 1%. Year-to-date sales of
$1.928 billion for fiscal 2004 increased 9% from $1.771 billion for the same
period last year while same-store sales were up 4% year-to-date.
Michael Rouleau, President and Chief Executive Officer, stated, "In
addition to changes in the timing of our custom frame promotions, September
business was materially impacted by the three hurricanes that struck the
southeastern United States, where we have over 150 stores. Same-store sales
in our Southeast zone declined almost 13%, dampening our overall same-store
sales results by approximately 2%. We were also affected more than
anticipated by the later Labor Day holiday and a planned reduction in the
number of promotional events for the period. After a slow start to the month,
same-store sales strengthened and were up solidly during the last two weeks of
September."
Rouleau added, "Our sales of regular priced merchandise showed strong
increases in September, but those increases were more than offset by year-
over-year declines in promotional and clearance sales. Our best performing
departments were Needlework & Yarn, Impulse & Party, Candles & Bakeware, and
Books, and our strongest zones were the Pacific, mid-Atlantic, and Central.
While we are not pleased with our September results, we remain optimistic that
consumers will respond positively to our enhanced merchandise offerings and
promotional programs for the upcoming Holiday season."
The Company expects October same-store sales to increase 4% to 5%, but
given September's sales performance, it now forecasts same-store sales growth
for the third quarter to be flat to up 2% compared to last year and diluted
earnings per share for the third quarter to range from $.58 to $.62 on a pre-
split basis. The Company continues to expect fourth quarter same-store sales
to increase 3% to 5% and currently forecasts fourth quarter diluted earnings
per share to range from $1.48 to $1.52 on a pre-split basis. For the year,
diluted earnings per share are expected to range from $2.86 to $2.94 on a pre-
split basis and inclusive of the second quarter pre-tax charge of $4.9 million
($3.0 million after tax) for the establishment of insurance reserves resulting
from the financial difficulties being experienced by one of the Company's
insurance providers.
On September 16, 2004, the Company announced a two-for-one stock split
that will be effected as a stock dividend for shareholders of record on
September 27, 2004, with a payment date of October 12, 2004.
The Company also announced that on Monday, October 25, 2004, Jeffrey
Boyer, Chief Financial Officer, will make a presentation at the Johnson Rice &
Company 4th Annual Consumer Conference in New Orleans, LA. A webcast of the
presentation, including slides, will be broadcast from the Investor Relations
page of the Company's website (http://www.michaels.com ) beginning at
approximately 3:15 p.m. ET. To listen to the presentation live, please go to
the website at least fifteen minutes early to register and download any
necessary software. For those unable to listen to the live presentation, it
will be archived on the website for sixty days from the date of the event.
The Company plans to release its October 2004 sales results on Thursday,
November 4, 2004 at 6:30 a.m. CT. The Company's press releases may be viewed
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 October 7, 2004, the Company owns
and operates 842 Michaels stores in 48 states and Canada, 164 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. Specific examples of
forward-looking statements include, but are not limited to, forecasts of same-
store sales growth and dilute 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 patterns; 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; 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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