Brookstone Announces Fourth Quarter and Fiscal Year 2010 Financial Results

News provided by

Mar 31, 2011, 06:00 ET

MERRIMACK, N.H., March 31, 2011 /PRNewswire/ -- Innovative product development company and specialty lifestyle retailer Brookstone, Inc. today announced financial results for the fourth quarter and full Fiscal Year ended January 1, 2011.

For the 13-week period ended January 1, 2011, Brookstone reported total net sales of $249.4 million, a 9.5% increase from the 13-week period ended January 2, 2010. Same-store sales for the 13-week period ended January 1, 2011 increased 5.7% as compared to the comparable 13-week period last year.

For the 13-week period ended January 1, 2011, Brookstone reported income from operations of $48.4 million, compared to income from operations of $48.3 million for the 13-week period ended January 2, 2010.

For the 52-week period ended January 1, 2011, Brookstone reported total net sales of $468.2 million, an 8.8% increase from the 52-week period ended January 2, 2010. Same-store sales for the 52-week period ended January 1, 2011 increased 6.7 % as compared to the comparable 52-week period last year.

For the 52-week period ended January 1, 2011, Brookstone reported income from operations of $4.7 million, compared to income from operations of $4.1 million for the 52-week period ended January 2, 2010.

Ron Boire, Brookstone Chief Executive Officer, said: "We are encouraged by our improving top line results. This quarter marks our fifth consecutive quarter of same-store sales increases. This positive trend reflects an exciting product assortment and improved selling efforts. We believe this progress, along with our successful 2010 capital restructuring, positions Brookstone favorably for 2011."

Brookstone, Inc. is an innovative product development and specialty lifestyle retail company that operates over 300 Brookstone branded 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. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands)

	January 1, 2011	January 2, 2010
	(Unaudited)
Assets

Current assets:
Cash and cash equivalents	$ 32,097	$ 31,802
Receivables, net	7,656	8,159
Merchandise inventories	96,004	86,428
Prepaid expenses	8,950	22,210

Total current assets	144,707	148,599


Property, plant and equipment, net	46,362	52,925
Intangible assets, net	105,000	105,000
Goodwill	99,734	99,734
Other assets	5,386	5,942

Total assets	$ 401,189	$ 412,200

Liabilities and Shareholder's Equity

Current liabilities:

Accounts payable	$ 32,836	$ 23,805
Other current liabilities	44,825	42,912
Deferred income taxes	716	762

Total current liabilities	78,377	67,479

Other long-term liabilities	19,604	20,554
Long-term Debt:
Senior Notes, at face value net of discount	135,080	169,222
Concession on 2010 Note Exchange, net	13,529	---
Other long-term debt	3,408	4,246
Total long-term debt	152,017	173,468

Deferred income taxes	37,819	37,773

Total shareholder's equity	113,372	112,926

Total liabilities and shareholder's equity	$ 401,189	$ 412,200

BROOKSTONE, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands) (Unaudited)


	Thirteen weeks ended	Thirteen weeks ended
	January 1, 2011	January 2, 2010

Net sales	$ 249,402	$ 227,662

Cost of sales	143,291	124,780

Gross profit	106,111	102,882

Selling, general and administrative expenses	57,745	51,979

Long-lived asset impairment	---	2,587

Income from operations	48,366	48,316

Interest expense, net	5,409	6,218

Income before taxes	42,957	42,098

Income tax provision (benefit)	120	(12,981)

Consolidated net income	42,837	55,079

Less: Net income attributable to noncontrolling interests	330	116

Net income attributable to Brookstone, Inc.	$ 42,507	$ 54,963

BROOKSTONE, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands)


	Fifty-two weeks ended	Fifty-two weeks ended
	January 1, 2011	January 2, 2010
	(Unaudited)

Net sales	$ 468,191	$ 430,258

Cost of sales	319,254	293,733

Gross profit	148,937	136,525

Selling, general and administrative expenses	144,216	129,857

Long-lived asset impairment	---	2,587

Income from operations	4,721	4,081

Interest expense, net	23,808	24,229

Loss before taxes	(19,087)	(20,148)

Income tax provision (benefit)	481	(12,377)

Consolidated net loss	(19,568)	(7,771)

Less: Net income attributable to noncontrolling interests	899	545

Net loss attributable to Brookstone, Inc.	$ (20,467)	$ (8,316)