Brookstone Announces Third Quarter and Year-to-Date 2010 Financial Results

Oct 29, 2010, 06:00 ET from Brookstone, Inc.

MERRIMACK, N.H., Oct. 29 /PRNewswire/ -- Innovative product development company and specialty lifestyle retailer Brookstone, Inc. today announced financial results for the third quarter ended October 2, 2010.  

For the 13-week period ended October 2, 2010, Brookstone reported total net sales of $72.7 million, a 6.6% increase from the comparable 13-week period of 2009.  Same-store sales increased 6.2% as compared to the comparable 13-week period last year.

For the 13-week period ended October 2, 2010, Brookstone reported a loss from operations of $14.1 million, compared to a loss from operations of $13.0 million for the comparable 13-week period last year.

For the 39-week period ended October 2, 2010, Brookstone reported total net sales of $218.8 million, an 8.0% increase from the comparable 39-week period of 2009.  Same-store sales increased 7.7% as compared to the comparable 39-week period last year.

For the 39-week period ended October 2, 2010, Brookstone reported a loss from operations of $43.7 million, compared to a loss from operations of $44.2 million for the comparable 39-week period last year.

Ron Boire, Brookstone President and Chief Executive Officer, said, "We are encouraged by our improving top line results. This quarter marks our fourth consecutive quarter of same-store sales increases. These positive trends reflect an exciting product assortment and improved selling efforts.  We believe this progress, along with our recently announced successful capital restructuring, finds Brookstone well-positioned for the fourth quarter and beyond."

Brookstone, Inc. is an innovative product development and specialty lifestyle retail company that operates over 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)



October 2, 2010


January 2, 2010


October 3, 2009


(Unaudited)




(Unaudited)

Assets












Current assets:






   Cash and cash equivalents

$             1,341


$                 31,802


$                  1,350

   Receivables, net

6,513


8,159


5,806

   Merchandise inventories

89,899


86,428


73,025

   Prepaid expenses

9,440


22,210


4,032







       Total current assets

107,193


148,599


84,213







Property, plant and equipment, net

47,633


52,925


58,196

Intangible assets, net

105,000


105,000


105,000

Goodwill

99,734


99,734


99,734

Other assets

6,224


5,942


6,591







Total assets

$         365,784


$               412,200


$              353,734







Liabilities and Shareholder's Equity












Current liabilities:






   Accounts payable

$           20,285


$                 23,805


$                16,844

   Other current liabilities

30,336


42,993


29,854

   Short-term borrowings

32,539


---


18,715







Total current liabilities

83,160


66,798


65,413







Other long-term liabilities

19,974


20,814


21,305

Long-term debt, net of current portion

173,002


173,468


173,623

Deferred income taxes

38,194


38,194


38,020







Total liabilities

314,330


299,274


298,361







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

245,470


244,088


241,747

Accumulated other comprehensive loss

(665)


(651)


(547)

Retained deficit

(194,507)


(131,532)


(186,495)

        Total Brookstone Shareholder's equity

50,298


111,905


54,705

Noncontrolling interests

1,156


1,021


668

Total equity

51,454


112,926


55,373







Total liabilities and equity

$         365,784


$               412,200


$             353,734




BROOKSTONE, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands)

(Unaudited)


Thirteen weeks ended


Thirty-nine weeks ended


October 2, 2010


October 3,

2009


October 2, 2010


October 3,

2009









Net sales

$         72,669


$           68,165


$       218,788


$       202,596









Cost of sales

58,958


55,675


175,962


168,953









Gross profit

13,711


12,490


42,826


33,643









Selling, general and administrative   expenses


27,816



25,457



          86,472



          77,878









Loss from operations

(14,105)


(12,967)


(43,646)


(44,235)









Interest expense, net

6,203


6,036


18,399


18,011









Loss before income taxes

(20,308)


(19,003)


(62,045)


(62,246)









Income tax provision (benefit)

(12)


40


361


604









Consolidated net loss

(20,296)


(19,043)


(62,406)


(62,850)









Less: Net income attributable to noncontrolling interests


216



147



569



429









Net loss attributable to Brookstone

$      (20,512)


$        (19,190)


$      (62,975)


$      (63,279)





Contact:


Philip Roizin

EVP, Operations and Chief Financial Officer

(603) 880-9500




SOURCE Brookstone, Inc.



RELATED LINKS

http://www.brookstone.com