- Diluted EPS Increases 29% to $0.40 -
- Announces Change in Accounting for Inventory -
IRVING, Texas, Nov. 22 /PRNewswire-FirstCall/ -- Michaels Stores, Inc.
(NYSE: MIK) today reported preliminary unaudited financial results for its
third quarter and nine-months ended October 29, 2005. Net income for the
quarter increased $12.9 million to $55.4 million, up 30.5% versus
$42.5 million for the same quarter last year. Diluted earnings per share
increased 29.0% for the quarter to $0.40 versus $0.31 in the third quarter of
2004. Net income for the nine months was $132.8 million compared to net
income of $98.6 million in the same period last year, a 34.7% increase.
Diluted earnings per share for the nine months were $0.96 compared to
$0.71 in the same period last year, an increase of 35.2%.
Michael Rouleau, Chief Executive Officer, said, "We are pleased with our
overall performance during the third quarter. Despite softer than anticipated
sales, we delivered another quarter of record earnings. As we have previously
reported, our third quarter sales were impacted by a number of factors;
primarily unseasonable weather, significantly higher gasoline prices and a
planned reduction in our promotional program. For the third quarter, we
expanded our operating margin by 120 basis points to 10.3% of sales, driven by
strong improvement in our gross margin rate. We continue to leverage our
recently installed perpetual inventory and automated replenishment systems,
resulting in stronger sales of regular priced merchandise and reduced levels
of clearance merchandise versus last year. Our operating income increased
19.0% over the same period last year to a third quarter record of
$86.6 million."
Mr. Rouleau added, "During the quarter, we continued our transformation of
Michaels Stores to a more sophisticated retailer by making solid progress on a
number of important initiatives. These initiatives include our transition to
a more merchandise-driven company, our 'Pursuit of the Perfect Store' program,
our new Hybrid Distribution method and our conversion to cost accounting. Our
enhanced inventory management systems continue to provide us with the ability
to strategically increase our inventory investment in categories with high
sales potential such as Jewelry, Yarn and Gift Giving, while at the same time
reducing levels of slower moving merchandise. Our 25 'Perfect Store' remodels
continue to be well received by our customers and, based on positive
preliminary results, we have decided to expand our remodel program to
approximately 65 additional stores in fiscal 2006. Additionally, the testing
of our Hybrid Distribution process is proceeding well, with strong cooperation
from our pilot vendors. Finally, our transition from our current retail
inventory method to the weighted average cost method will provide the entire
organization with much improved accountability for, and insights into, our
business."
Mr. Rouleau concluded, "We expect another successful holiday season during
the upcoming fourth quarter. The merchandising of key categories such as
Jewelry, Papercrafting, and Yarn has been greatly enhanced, and our
advertising is expected to be more focused and effective as we continue to
refine our promotional offers. We are expanding on last year's very
successful Gift Giving initiative, and we are launching our first-ever
nationwide radio advertising campaign during the critical holiday period.
With improvements in our assortments, merchandising, store operations, and
advertising, we are extremely well-prepared for this year's holiday season.
However, despite our excitement and enthusiasm as we enter the fourth quarter,
we continue to maintain a cautious outlook overall. Although we have never
been better prepared for the fourth quarter, many retailers have indicated
concerns regarding consumer confidence and the shape of the competitive and
promotional landscape during the holiday season. As a result, we will manage
our business prudently through tight expense and inventory controls. That
said, given our outstanding performance so far this year and our exciting
plans for the fourth quarter, we fully expect that 2005 will be our ninth
straight year of record operating earnings."
Operating Performance
Total sales for the quarter increased 5.0% to $839.7 million from
$799.9 million for the same period last year. Same-store sales for the quarter
increased 0.8% on a 3.7% increase in average ticket, a 3.2% decrease in
transactions and a 0.3% increase in custom frame deliveries. A favorable
currency translation, due to the stronger Canadian dollar, contributed
approximately 0.4% to the average ticket increase for the quarter. Our
domestic Michaels stores' Southeast, Pacific, and Southwest zones delivered
the strongest same-store sales performances, and our strongest departmental
performances came in our General Crafts, Custom Framing, Yarn, and Ribbon and
Wedding categories. The growth in our General Crafts category was due
primarily to the continuing strong performance in our Jewelry and Bead
business.
For the quarter, the Company's operating income increased 19.0% to
$86.6 million and to 10.3% of sales from $72.8 million and 9.1% of sales for
the same period last year. Gross margin expanded 210 basis points from
37.0% of sales in the third quarter of last year to 39.1% in the third quarter
of fiscal 2005, due to improved merchandise margins, partially offset by
higher occupancy costs as a percent of sales. Merchandise margins expanded
primarily as a result of stronger sales of merchandise at regular price,
better clearance margin realization, cost reductions as a result of improved
domestic sourcing, and additional efficiencies in our supply chain and
vertical manufacturing operations.
Selling, general and administrative expenses increased 8.4% and supported
a 5.0% increase in sales, with expenses as a percent of sales increasing to
28.5% from 27.6% in the third quarter of last year. Increases in store
personnel related costs over the prior year generated the majority of the
increase in selling expenses. During the third quarter, the Company hired
holiday seasonal labor earlier compared to last year in order to improve store
staffing heading into the critical holiday selling season. In addition,
administrative expenses in the quarter were higher than the same quarter last
year due to increases in legal fees, professional fees, and bonus expenses.
Other income includes approximately $2.2 million related to our estimated
settlement proceeds from the Visa Check/MasterMoney Antitrust Litigation.
Balance Sheet
The Company's combined cash and short-term investment balances at the end
of the quarter were $112.5 million, a decrease of $159.9 million over last
year's third quarter combined ending balances of $272.4 million. This
reduction is mainly attributable to the Company's early redemption of its $200
million, 91/4% Senior Notes in July 2005 and its ongoing share repurchase and
dividend programs.
Average inventory per Michaels store, at the end of the third quarter,
inclusive of distribution centers, increased 4.2% year over year to $1.264
million after declining 7.6% in the third quarter of 2004. The primary driver
of this increase is our incremental investment in Yarn and Gift Giving items
in preparation for the fall and holiday seasons. The Company's perpetual
inventory and automated replenishment merchandising systems continue to enable
inventory to be redeployed from slow and no growth categories, to those with
higher growth opportunities.
During the quarter, the Company opened 19 and relocated seven Michaels
stores and opened one Aaron Brothers store. Additionally, during the third
quarter, the Company entered into an agreement to lease a new distribution
center in Centralia, Washington beginning in late fiscal 2006.
The Company also announced that it has repurchased an additional 1,380,600
shares of the Company's common stock during the third quarter of fiscal 2005
under its stock repurchase plans at an average price, including commissions,
of $34.72 per share. Subsequent to the end of the quarter, the Company
repurchased an additional 1,267,800 shares at an average price, including
commissions, of $34.20 per share. Year-to-date, the Company has repurchased
4,580,497 shares at an average price, including commissions, of $35.47 per
share. As of November 22, 2005, under its repurchase plans, the Company is
authorized to repurchase approximately 340,000 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.
Additionally, on November 18, 2005, the Company signed a new 5-year $300
million Revolving Credit Agreement with a syndicate of banks replacing, and on
terms the Company believes are more favorable than those in, its previous $200
million revolving credit agreement that would have expired on April 30, 2006.
Change in Accounting for Inventory
Currently, the Company values inventory at the lower of cost or market,
with cost determined using a retail inventory method. This inventory method
uses quarterly physical inventory count results from a broad sample of stores
to estimate ending inventories valued at retail for all Michaels stores.
These inventory values are used in the Company's retail inventory method
calculation, which determines cost of sales and ending inventory at cost using
a single pool of inventory.
Subsequent to the implementation of its perpetual inventory system in
fiscal 2004, the Company began evaluating the use of this system to value
inventory for both operational and financial reporting purposes. During the
third quarter of fiscal 2005, the Company determined that it would change its
accounting principle for valuing merchandise inventories from its current
retail inventory method to the weighted average cost method. The weighted
average cost method will utilize the newly available perpetual inventory
records to value inventories at the lower of cost or market on a store-level
SKU basis. The Company currently expects to adopt this new inventory
accounting policy during the fourth quarter of fiscal 2005, but no later than
the first quarter of fiscal 2006.
Mr. Rouleau said, "Our new SKU-specific, weighted average cost method of
accounting will allow for more accurate reporting of periodic inventory
balances by eliminating the averaging inherent in our current retail method.
We expect to have significantly improved accountability within the
merchandising department and across our stores with a consistent operational
and financial reporting inventory valuation method. Using this SKU-specific
costing methodology should enable management to more precisely manage
inventory levels and more effectively execute business plans, while also
providing additional business insights."
As the Company currently expects to adopt the change in accounting
principle during the fourth quarter of fiscal 2005, the cumulative effect of
the change will be recorded as of the beginning of the 2005 fiscal year. We
currently estimate that our inventory balance as of the beginning of fiscal
2005 will be approximately $796 million on the weighted average cost method,
approximately $140 million lower than the inventory balance reported under the
Company's current retail inventory method. The non-cash reduction in the
inventory balance as of the beginning of fiscal 2005 is due to the change in
accounting principle and is not an indication of an inventory impairment or
inventory write-off as the underlying retail value of the Company's
inventories is not impacted by this accounting change.
The change in the Company's accounting method for merchandise inventory is
expected to have a two-fold effect on fiscal 2005 financial statements: a
cumulative effect of accounting change and a full year impact on cost of goods
sold. This accounting change is expected to be reported as a change in
accounting principle, under APB No. 20, Accounting Changes, effective as of
the beginning of fiscal 2005. The non-cash cumulative effect of this change
in accounting principle on all prior periods is currently estimated at
approximately $140 million on a pre-tax basis. On an after-tax basis, the
cumulative effect of the change in accounting principle is estimated at $87
million or approximately $0.62 per diluted share, which is net of an income
tax benefit of approximately $53 million. For fiscal 2005, cost of goods sold
under the weighted average cost method is presently estimated to be modestly
higher, approximately $15 million on a pre-tax basis, than under the Company's
current retail inventory method. The estimates of the beginning of fiscal
2005 cumulative effect of the accounting change and fiscal 2005 income
statement effect are preliminary and may change materially. Note that the
Company is not able to compute a pro forma annual impact in any years prior to
fiscal 2005 as the information required to value inventory on the weighted
average cost method in prior years is not available. Please see selected
financial data below for further reference regarding a financial forecast
comparison under the cost and retail methods of accounting for merchandise
inventories:
Selected financial data ($ in millions, except per share amounts)
Fiscal 2004 Fiscal 2005 Forecast (B) Fiscal 2006
Retail Retail Cost Forecast
Method (A,D) Method (D) Method (E) Cost Method (C,E)
Net Sales $3,393 $3,680 $3,680 $3,935
Operating Income $340 $425 $410 $470
Income before
cumulative effect
of accounting
change, net of
income tax $202 $257 $247 $300
Cumulative effect
of accounting
change, net of
income tax --- --- 87 ---
------- ------- ------- -------
Net Income $202 $257 $160 $300
======= ======= ======= =======
Diluted earnings
per common share
before cumulative
effect of
accounting change $1.45 $1.85 $1.78 $2.15
Diluted earnings
per common share
after cumulative
effect of
accounting change $1.45 $1.85 $1.15 $2.15
(A) Amounts as reported in the Company's Annual Report on Form 10-K for
the fiscal year ended January 29, 2005
(B) Amounts represent the midpoint of the 2005 forecast range disclosed
in the outlook section of this earnings press release. The midpoint
was selected for purposes of this presentation only. Actual results
may differ materially from the above amounts.
(C) Amounts represent the midpoint of the preliminary 2006 guidance range
disclosed in the outlook section of this earnings press release. The
midpoint was selected for purposes of this presentation only. Actual
results and future guidance may differ materially from the above
amounts.
(D) Retail method amounts reflect the application of the Company's
current retail inventory method to determine inventory cost.
(E) Cost method amounts reflect the proposed application of the weighted
average cost method to determine inventory cost, based on the
Company's preliminary estimates. Actual impacts could differ
materially from the above amounts.
Outlook
The Company currently forecasts same-store sales for the fourth quarter of
fiscal 2005 to increase 3% to 5% over the fourth quarter of fiscal 2004.
Under the Company's current retail inventory method, operating margin is
expected to expand by approximately 140 basis points in the fourth quarter of
fiscal 2005 versus the fourth quarter of fiscal 2004, driven by gross margin
expansion, partially offset by higher advertising and personnel costs as a
percent to sales. Note that gross margin for the fourth quarter of fiscal
2004 included the Company's charge for a lease accounting correction, which
totaled approximately $12.8 million on a pre-tax basis. Consistent with prior
guidance, the Company estimates that fourth quarter diluted earnings per
share, under the current retail inventory method of accounting, would range
from $0.88 to $0.92.
For fiscal 2005, the Company expects same-store sales to increase 3% to 5%
and total sales to increase 8% to 9%. Under the current retail inventory
method, operating margin for the year is expected to grow approximately 150
basis points primarily driven by gross margin expansion, and diluted earnings
per share for 2005 is expected to range from $1.83 to $1.87, an increase of
approximately 26% to 29% over fiscal 2004 results.
With the adoption of the weighted average cost method, the Company
currently expects that cost of sales for fiscal 2005 will increase
approximately $15 million on a pre-tax basis, or $0.07 per diluted share, when
compared with the current retail inventory method. Therefore, under the
weighted average cost method, the Company expects full year earnings per share
before the cumulative effect of the accounting change to range from $1.76 to
$1.80, an increase of 21% to 24% over fiscal 2004 diluted earnings per share
of $1.45. Although the Company expects to adopt the weighted average cost
method during the fourth quarter of fiscal 2005, under SFAS No. 3, Reporting
Accounting Changes in Interim Financial Statements, the cumulative effect of
the accounting change will be recorded as of the first quarter of fiscal 2005.
All previously reported quarters for fiscal 2005 will be restated to reflect
the weighted average cost method of accounting for inventory.
On a preliminary basis, the Company expects fiscal 2006 diluted earnings
per share before the cumulative effect of the accounting change to increase
19% to 22%, from $1.76 to $1.80 in fiscal 2005 to $2.10 to $2.20 in fiscal
2006. Note that these fiscal 2005 and fiscal 2006 diluted earnings per share
estimates are before the cumulative effect of the accounting change and stock
based compensation expense, on the weighted average cost method, and on a 52-
week basis. Future guidance and results may change materially from these
preliminary estimates. Note that fiscal 2006 is a 53-week year and diluted
earnings per share estimates will be revised in the future to reflect fiscal
2006 on a 53-week basis. On a 52-week basis, the fiscal 2006 same-store sales
are expected to increase 2% to 4% with total sales increasing 6% to 8%.
Fiscal 2006 operating margin is forecast to expand 80 to 90 basis points,
driven by both gross margin expansion and selling, general, and administrative
expense leverage.
The Company will host a conference call at 4:00 p.m. central time today to
discuss its third quarter and year-to-date fiscal 2005 earnings results as
well as its outlook for the remainder of fiscal 2005 and inventory accounting
change. 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. Recordings may be accessed at http://www.michaels.com or by phone at
973-341-3080, PIN 5446633.
The Company plans to release its 2005 fourth quarter sales on Thursday,
February 2, 2006, at 6:30 a.m. central time. 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 November 22, 2005, the Company owns
and operates 889 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 and July 30, 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 annual 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 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, 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 control
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 ).
-- Tables Follow --
Michaels Stores, Inc.
Consolidated Statements of Income
(In thousands, except per share data)
(Unaudited)
Quarter Ended Nine Months Ended
Oct. 29, Oct. 30, Oct. 29, Oct. 30,
2005 2004 2005 2004
Net sales $839,663 $799,905 $2,406,172 $2,208,691
Cost of sales and
occupancy expense 511,545 504,236 1,491,084 1,395,492
Gross profit 328,118 295,669 915,088 813,199
Selling, general, and
administrative expense 239,048 220,489 681,530 633,348
Store pre-opening costs 2,456 2,408 6,649 7,534
Operating income 86,614 72,772 226,909 172,317
Interest expense 229 5,042 20,819 15,439
Other (income) and expense, net (3,039) (1,077) (8,088) (2,743)
Income before income taxes 89,424 68,807 214,178 159,621
Provision for income taxes 33,982 26,319 81,388 61,055
Net income $55,442 $42,488 $132,790 $98,566
Earnings per common share:
Basic $0.41 $0.31 $0.98 $0.72
Diluted $0.40 $0.31 $0.96 $0.71
Weighted average shares
outstanding:
Basic 135,395 135,550 135,729 136,138
Diluted 138,000 138,796 138,801 139,257
Dividends per common share $0.10 $0.07 $0.27 $0.19
Michaels Stores, Inc.
Consolidated Balance Sheets
(In thousands, except share data)
(Unaudited)
Subject to reclassification Oct. 29, Jan. 29, Oct. 30,
2005 2005 2004
ASSETS
Current assets:
Cash and equivalents $112,517 $535,852 $222,171
Short-term investments --- 50,379 50,235
Merchandise inventories 1,214,504 936,395 1,096,400
Prepaid expenses and other 49,033 26,613 34,633
Deferred and prepaid income taxes 30,405 22,032 19,471
Total current assets 1,406,459 1,571,271 1,422,910
Property and equipment, at cost 990,171 913,174 863,421
Less accumulated depreciation (571,554) (506,193) (469,867)
418,617 406,981 393,554
Goodwill 115,839 115,839 115,839
Other assets 18,676 17,569 16,810
134,515 133,408 132,649
Total assets $1,959,591 $2,111,660 $1,949,113
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $253,034 $256,266 $257,023
Accrued liabilities and other 259,211 242,682 222,248
Income taxes payable --- 12,992 6,066
Total current liabilities 512,245 511,940 485,337
9 1/4% Senior Notes due 2009 --- 200,000 200,000
Deferred income taxes 26,848 30,355 27,550
Other long-term liabilities 85,582 72,200 41,256
Total long-term liabilities 112,430 302,555 268,806
624,675 814,495 754,143
Commitments and contingencies
Stockholders' equity:
Preferred Stock, $0.10 par value,
2,000,000 shares authorized;
none issued --- --- ---
Common Stock, $0.10 par value,
350,000,000 shares authorized;
shares issued and outstanding of
134,800,844 at October 29, 2005,
135,726,717 at January 29, 2005, and
135,093,810 at October 30, 2004 13,480 13,573 13,509
Additional paid-in capital 386,330 451,449 438,850
Retained earnings 922,907 826,821 733,069
Accumulated other comprehensive
income 12,199 5,322 9,542
Total stockholders' equity 1,334,916 1,297,165 1,194,970
Total liabilities and stockholders'
equity $1,959,591 $2,111,660 $1,949,113
Michaels Stores, Inc.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Nine Months Ended
Subject to reclassification Oct. 29, Oct. 30,
2005 2004
Operating activities:
Net income $132,790 $98,566
Adjustments:
Depreciation 72,656 65,756
Amortization 292 294
Loss from early extinguishment of debt 12,136 ---
Other 391 780
Changes in assets and liabilities:
Merchandise inventories (278,109) (203,477)
Prepaid expenses and other (22,420) (5,435)
Deferred income taxes and other (4,871) (3,342)
Accounts payable (3,232) 84,315
Income taxes payable (2,445) 16,917
Accrued liabilities and other 24,679 33,157
Other long-term liabilities 10,265 4,099
Net cash (used in) provided by
operating activities (57,868) 91,630
Investing activities:
Additions to property and equipment (85,785) (71,663)
Purchases of short-term investments (226) (50,235)
Sales of short-term investments 50,605 ---
Net proceeds from sales of property
and equipment --- 60
Net cash used in investing activities (35,406) (121,838)
Financing activities:
Repayment of Senior Notes (209,250) ---
Proceeds from stock options exercised 32,285 28,595
Repurchase of Common Stock (119,133) (94,582)
Cash dividends paid to stockholders (36,709) (25,867)
Proceeds from issuance of Common
Stock and other 2,746 2,408
Net cash used in financing
activities (330,061) (89,446)
Net decrease in cash and equivalents (423,335) (119,654)
Cash and equivalents at beginning of period 535,852 341,825
Cash and equivalents at end of period $112,517 $222,171
Michaels Stores, Inc.
Summary of Operating Data
(Unaudited)
The following table sets forth the percentage relationship to net sales of
each line item of our unaudited consolidated statements of income:
Quarter Ended Nine Months Ended
Oct. 29, Oct. 30, Oct. 30, Oct. 29,
2005 2004 2005 2004
Net sales 100.0% 100.0% 100.0% 100.0%
Cost of sales and occupancy expense 60.9 63.0 62.0 63.2
Gross profit 39.1 37.0 38.0 36.8
Selling, general, and
administrative expense 28.5 27.6 28.3 28.7
Store pre-opening costs 0.3 0.3 0.3 0.3
Operating income 10.3 9.1 9.4 7.8
Interest expense --- 0.6 0.8 0.7
Other (income) and expense, net (0.3) (0.1) (0.3) (0.1)
Income before income taxes 10.6 8.6 8.9 7.2
Provision for income taxes 4.0 3.3 3.4 2.7
Net income 6.6% 5.3% 5.5% 4.5%
The following table sets forth certain of our unaudited operating data
(dollar amounts in thousands):
Quarter Ended Nine Months Ended
Oct. 29, Oct. 30, Oct. 29, Oct. 30,
2005 2004 2005 2004
Michaels stores:
Retail stores open at beginning
of period 870 827 844 804
Retail stores opened during the
period 19 22 46 45
Retail stores opened (relocations)
during the period 7 8 18 30
Retail stores closed during the
period --- --- (1) ---
Retail stores closed (relocations)
during the period (7) (8) (18) (30)
Retail stores open at end of
period 889 849 889 849
Aaron Brothers stores:
Retail stores open at beginning of
period 165 160 164 158
Retail stores opened during the
period 1 4 2 7
Retail stores opened (relocations)
during the period --- 1 --- 1
Retail stores closed during the
period --- --- --- (1)
Retail stores closed (relocations)
during the period --- (1) --- (1)
Retail stores open at end of
period 166 164 166 164
ReCollections stores:
Retail stores open at beginning of
period 11 5 8 2
Retail stores opened during the
period --- 3 3 6
Retail stores open at end of
period 11 8 11 8
Star Wholesale stores:
Wholesale stores open at beginning
of period 4 3 3 3
Wholesale stores opened during the
period --- --- 1 ---
Wholesale stores open at end of
period 4 3 4 3
Total store count at end of period 1,070 1,024 1,070 1,024
Other operating data:
Average inventory per Michaels
store (A) $1,264 $1,213 $1,264 $1,213
Comparable store sales
increase (B) 0.8% 0.9% 4.2% 3.9%
(A) Average inventory per Michaels store calculation excludes Aaron
Brothers, Recollections, and Star Wholesale stores.
(B) Comparable store sales increase represents the increase in net sales
for stores open the same number of months in the indicated period and
the comparable period of the previous year, including stores that were
relocated or expanded during either period. A store is deemed to
become comparable in its 14th month of operation in order to eliminate
grand opening sales distortions. A store temporarily closed more than
2 weeks due to a catastrophic event is not considered comparable
during the month it closed. If a store is closed longer than 2 weeks
but less than 2 months, it becomes comparable in the month in which it
reopens, subject to a mid-month convention. A store closed longer
than 2 months becomes comparable in its 14th month of operation after
its reopening.
SOURCE Michaels Stores, Inc.
 back to top
Related links:
http://www.michaels.com
Photo Notes:http://www.newscom.com/cgi-bin/prnh/20040804/DAMICHAELSLOGO
AP Archive: http://photoarchive.ap.org PRN Photo Desk
photodesk@prnewswire.com
Company News On-Call:
http://www.prnewswire.com/comp/115769.html
CONTACT:
Lisa K. Klinger, Vice President - Treasurer
and Investor Relations of Michaels Stores, Inc., +1-972-409-1528,
or klingerl@michaels.com
|
