Retail Ventures, Inc. Reports Third Quarter Operating Results

Dec 08, 2010, 16:42 ET from Retail Ventures, Inc.

COLUMBUS, Ohio, Dec. 8, 2010 /PRNewswire-FirstCall/ -- Retail Ventures, Inc. (NYSE: RVI) today announced its consolidated financial results for the third quarter ended October 30, 2010.

  • The income (loss) from continuing operations for the quarter ended October 30, 2010 was a profit of $7.9 million on net sales of $489.3 million, compared to a loss of $3.9 million on net sales of $444.6 million for the quarter ended October 31, 2009. DSW same store sales increased 10.1% during the third quarter versus an increase of 8.7% last year.
  • Diluted (loss) earnings per share from continuing operations attributable to Retail Ventures, Inc. common shareholders was $0.11 for the quarter ended October 30, 2010 compared with diluted loss per share from continuing operations attributable to Retail Ventures, Inc. of $0.28 per share for the quarter ended October 31, 2009.

Retail Ventures, Inc. is a holding company whose subsidiary, DSW, is a leading United States branded footwear specialty retailer operating as of October 30, 2010, 313 DSW shoe stores in 39 states.  DSW also supplies shoes, under supply arrangements, to 351 locations for other retailers in the United States and operates dsw.com.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

Any statements in this release that are not historical or current facts are forward-looking statements. All forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties and other factors that could cause our future financial performance in fiscal 2010 and beyond to differ materially from those expressed or implied in any such forward-looking statements. Certain of these risks and uncertainties are described in the "Risk Factors" section of the Company's latest quarterly or annual report, as filed with the SEC. These factors include, but are not limited to: our ability to manage and enhance liquidity; DSW's success in opening and operating new stores on a timely and profitable basis; continuation of DSW's supply agreements and the financial condition of its leased business partners; DSW maintaining good relationships with its vendors; DSW's ability to anticipate and respond to fashion trends; fluctuation of DSW's comparable store sales and quarterly financial performance; the realization of our bankruptcy claims related to liquidating Filene's Basement and Value City; the impact of the disposition of Filene's Basement and of a majority interest in Value City and the reliance on remaining subsidiaries to pay indebtedness and intercompany service obligations; the risk of Value City and liquidating Filene's Basement not paying us or their creditors, for which Retail Ventures may have some liability; the risk of new Filene's Basement not paying obligations related to the assets it has assumed from liquidating Filene's Basement if such obligations are subject to ongoing guarantee by us; the impact of Value City and Filene's Basement on our liquidity; disruption of DSW's distribution operations; our dependence on DSW for key services; failure to retain our key executives or attract qualified new personnel; DSW's competitiveness with respect to style, price, brand availability and customer service; uncertain general economic conditions; risks inherent to international trade with countries that are major manufacturers of footwear; the success of dsw.com; lease of an office facility; risks related to our cash and investments and various risks associated with the Value City bankruptcy proceedings. Additional factors that could cause our actual results to differ materially from our expectations are described in the Company's latest annual or quarterly report, as filed with the SEC. Any forward-looking statement speaks only as of the date on which such statement is made.  The Company undertakes no obligation to revise the forward-looking statements included in this press release to reflect any future events or circumstances.

RETAIL VENTURES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(unaudited)

October 30,

January 30,

2010

2010

ASSETS

Cash and equivalents

$113,927

$ 141,773

Short-term investments

206,065

164,265

Accounts receivable, net

11,631

6,663

Inventories

332,446

262,284

Prepaid expenses and other current assets

30,218

22,478

Deferred income taxes

34,571

29,560

Total current assets

728,858

627,023

Property and equipment, net

208,804

208,813

Goodwill

25,899

25,899

Conversion feature of long-term debt

28,029

Deferred income taxes and other assets

36,182

13,701

Total assets

$999,743

$903,465

LIABILITIES AND SHAREHOLDERS' EQUITY

Accounts payable

$139,933

$121,277

Accrued expenses

110,718

113,474

Current maturities of long-term obligations

131,519

Warrant liability

34,328

23,068

Conversion feature of short-term debt

6,553

Total current liabilities

423,051

257,819

Long-term obligations

129,757

Deferred income taxes and other non current liabilities

114,170

112,599

Total Retail Ventures' shareholders' equity

227,591

205,869

Noncontrolling interests

234,931

197,421

Total shareholders' equity

462,522

403,290

Total liabilities and shareholders' equity

$999,743

$903,465

RETAIL VENTURES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars in thousands, except per share amounts)

(unaudited)

Three months ended

Nine months ended

October 30,

October 31,

October 30,

October 31,

2010

2009

2010

2009

Net sales

$  489,269

$  444,621

$  1,353,926

$  1,199,957

Cost of sales

(268,485)

(238,549)

(737,626)

(666,416)

Gross profit

220,784

206,072

616,300

533,541

Selling, general and administrative expenses

(171,883)

(164,862)

(479,947)

(531,140)

Change in fair value of derivative instruments

(31,681)

(30,701)

(45,843)

(40,778)

Operating profit (loss)

17,220

10,509

90,510

(38,377)

Interest expense, net

(2,077)

(2,610)

(7,361)

(7,787)

Non-operating income (expense), net

1,500

(754)

1,500

(621)

Income (loss) from continuing operations before income taxes

16,643

7,145

84,649

(46,785)

Income tax expense

(8,726)

(11,079)

(38,532)

(13,507)

Income (loss) from continuing operations

7,917

(3,934)

46,117

(60,292)

Total income (loss) from discontinued operations, net of tax

2,191

(295)

5,161

44,664

Net income (loss)

10,108

(4,229)

51,278

(15,628)

Less: net income attributable to the noncontrolling interests

(13,428)

(9,900)

(33,642)

(15,359)

Net (loss) income attributable to Retail Ventures, Inc.

$  (3,320)

$  (14,129)

$  17,636

$  (30,987)

Basic and diluted (loss) earnings per share:

Basic (loss) earnings per share from continuing operations attributable to Retail Ventures, Inc. common shareholders

$  (0.11)

$  (0.28)

$  0.25

$  (1.55)

Diluted (loss) earnings per share from continuing operations attributable to Retail Ventures, Inc. common shareholders

$  (0.11)

$  (0.28)

$  0.25

$  (1.55)

Basic earnings (loss) per share from discontinued operations attributable to Retail Ventures, Inc. common shareholders

$  0.04

$  (0.01)

$  0.11

$  0.91

Diluted earnings (loss) per share from discontinued operations attributable to Retail Ventures, Inc. common shareholders

$  0.04

$  (0.01)

$  0.10

$  0.91

Basic (loss) earnings per share attributable to Retail Ventures, Inc. common shareholders

$  (0.07)

$  (0.29)

$  0.36

$  (0.63)

Diluted (loss) earnings per share attributable to Retail Ventures, Inc. common shareholders

$  (0.07)

$  (0.29)

$  0.36

$  (0.63)

Shares used in per share calculations:

Basic

49,037

48,938

49,028

48,855

Diluted

49,037

48,938

49,315

48,855

Amounts attributable to Retail Ventures, Inc. common shareholders:

(Loss) income from continuing operations, net of tax

$  (5,511)

$  (13,834)

$  12,475

$  (75,651)

Discontinued operations, net of tax

2,191

(295)

5,161

44,664

Net (loss) income

$  (3,320)

$  (14,129)

$  17,636

$  (30,987)

SOURCE Retail Ventures, Inc.



RELATED LINKS

http://www.retailventuresinc.com