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Brookstone Announces First Quarter 2011 Financial Results

MERRIMACK, N.H., May 17, 2011 /PRNewswire/ -- Innovative product development company and specialty lifestyle retailer Brookstone, Inc. today announced financial results for the first quarter ended April 2, 2011.  

For the 13-week period ended April 2, 2011, Brookstone reported total net sales of $80.1 million, a 14.9% increase from the comparable 13-week period of 2010.  Same-store sales increased 10.2% as compared to the comparable 13-week period last year.

For the 13-week period ended April 2, 2011, Brookstone reported a loss from operations of $14.4 million, compared to a loss from operations of $17.0 million for the comparable 13-week period last year.

Ron Boire, Brookstone President and Chief Executive Officer, said, "We are encouraged by the improving results in both segments of our business. For our retail stores, the first quarter of 2011 marks our sixth consecutive quarter of same-store sales increases, while the direct segment has generated increased sales in the internet and wholesale divisions.  This positive trend reflects an expanding product assortment in our direct segment and improved selling efforts in our retail stores.  We believe that Brookstone is well-positioned for the remainder of 2011."

About Brookstone:  

Brookstone, Inc. is an innovative product development and specialty lifestyle retail company that operates approximately 300 Brookstone Brand stores nationwide and in Puerto Rico. Typically located in high-traffic regional shopping malls and airports, the stores feature unique and innovative consumer products. The Company also operates a Direct Marketing business that includes the Brookstone catalog and an e-commerce website at http://www.brookstone.com.

Brookstone is principally owned by three sponsors, Osim International, J.W. Childs, and Temasek Holdings.  In accordance with the terms governing its publicly-held debt, the Company issues quarterly and annual reports under SEC guidelines.

Statements in this release which are not historical facts, including statements about the Company's confidence or expectations, earnings, anticipated operations of its e-commerce sites and those of third-party service providers, and other statements about the Company's operational outlook are forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 ("Reform Act") and are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in such forward-looking statements. Such risks and uncertainties include, without limitation, risks of changing market conditions in the overall economy and the retail industry, consumer demand, the effectiveness of e-commerce technology and marketing efforts, availability of products, availability of adequate transportation of such products, and other factors detailed from time to time in the Company's annual and other reports posted to the Company's website. Words such as "estimate", "project", "plan", "believe", "feel", "anticipate", "assume", "may", "will", "should" and similar words and phrases may identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date thereof. The Company undertakes no obligations to publicly release any revisions to these forward-looking statements or reflect events or circumstances after the date hereof.

BROOKSTONE, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)


April 2, 2011


January 1, 2011


April 3, 2010


(Unaudited)




(Unaudited)

Assets












Current assets:






   Cash and cash equivalents

$                       1,520


$                   32,097


$                       1,125

   Receivables, net

8,428


7,266


6,772

   Merchandise inventories

83,724


96,004


79,006

   Prepaid expenses

8,004


8,950


12,760







       Total current assets

101,676


144,317


99,663







Property, plant and equipment, net

46,451


46,362


50,256

Intangible assets, net

105,000


105,000


105,000

Goodwill

99,734


99,734


99,734

Other assets

4,982


5,386


5,254







Total assets

$                   357,843


$                 400,799


$                   359,907







Liabilities and Equity












Current liabilities:






   Accounts payable

$                     13,977


$                   32,836


$                       7,357

   Other current liabilities

27,878


44,435


30,281

   Short-term borrowings

12,585


---


---

   Deferred income taxes

716


716


762

Total current liabilities

55,156


77,987


38,400







Long-term debt:






   Senior Notes, at face value net of discount

135,110


135,080


169,293

   Concession on 2010 Note Exchange, net

12,764


13,529


---

   Other long-term debt

3,115


3,408


4,086

       Total long-term debt

150,989


152,017


173,379







Other long-term liabilities

19,318


19,604


20,413

Deferred income taxes

37,819


37,819


37,773

Total liabilities

263,282


287,427


269,965







Commitments and contingencies

---


---


---







Equity:






Brookstone Shareholder's equity:






Common stock – $0.01 par value 1,000 shares
authorized, one share issued and outstanding

---


---


---

Additional paid-in capital

265,500


265,485


244,259

Accumulated other comprehensive loss

(1,419)


(1,414)


(656)

Retained deficit

(171,134)


(151,999)


(154,934)

Total Brookstone Shareholder's equity

92,947


112,072


88,669

Noncontrolling interests

1,614


1,300


1,273

Total equity

94,561


113,372


89,942







Total liabilities and equity

$                   357,843


$                 400,799


$                   359,907




BROOKSTONE, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands)

(Unaudited)


Thirteen weeks ended


April 2, 2011


April 3, 2010





Net sales

$              80,095


$              69,732





Cost of sales

64,271


57,848





Gross profit

15,824


11,884





Selling, general and administrative expenses

30,174


28,930





Loss from operations

(14,350)


(17,046)





Interest expense, net

4,424


6,051





Loss before income taxes

(18,774)


(23,097)





Income tax provision

121


187





Consolidated net loss

(18,895)


(23,284)





Less: Net income attributable to noncontrolling interests

240


118





Net loss attributable to Brookstone

$           (19,135)


$           (23,402)







Contact:

Thomas F. Moynihan
Vice President and Chief Financial Officer
(603) 880-9500

SOURCE Brookstone, Inc.



RELATED LINKS
http://www.brookstone.com

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