Destination Maternity Reports Preliminary Sales For November 2010

Comparable Retail Sales Increase 5.1% on a Reported Basis, and Increase Approximately 6.0% after Adjusting for Calendar Shift

Dec 02, 2010, 06:00 ET from Destination Maternity Corporation

PHILADELPHIA, Dec. 2, 2010 /PRNewswire-FirstCall/ -- Destination Maternity Corporation (Nasdaq: DEST), the world's leading maternity apparel retailer, today reported that preliminary net sales for the month of November 2010 increased 0.4% to $42.8 million from $42.7 million reported for the month of November 2009.  Comparable retail sales data (which consists of comparable store sales and Internet sales) for the month of November 2010 and 2009 is included in the table below.

November 2010

November 2009

% increase (decrease)

Reported Basis

Comparable retail sales

5.1

%

(9.6)

%

Comparable store sales

4.0

%

(11.6)

%

Internet sales

23.7

%

51.1

%

Adjusted for Calendar Timing Shift

Comparable retail sales

6.0

%

(6.2)

%

Comparable store sales

5.0

%

(8.1)

%

The slight increase in total reported sales for November 2010 compared to November 2009 resulted primarily from the increase in comparable store sales and increased Internet sales, partially offset by decreased sales from the Company's licensed relationship.  The increase in comparable store sales for the month was at the top end of the Company's guidance range provided in its November 18, 2010 press release.  Comparable store sales for November 2010 increased 4.0% on a reported basis, compared to a guidance range of a 1% to 4% increase.  After adjusting for the "days adjustment calendar shift," reflecting one less Sunday in November 2010 compared to November 2009, comparable store sales for the month increased 5.0%, compared to a guidance range of a 2% to 5% increase.  

Ed Krell, Chief Executive Officer and President of Destination Maternity, noted, "We are very pleased with our strong comparable retail sales for November and with our continued progress in improving our sales performance.  Our November sales results were at the top end of our revised mid-month outlook.  Our sales results for November reflect strong overall demand for our Fall apparel, which we believe was helped by favorable weather throughout most of the United States, due to colder than normal weather for the month and colder weather in comparison to the unseasonably warm weather experienced during both October this year and November last year.  It is also important to note that we were able to achieve our strong sales performance with higher merchandise gross margin this November compared to last year."

During November 2010, the Company opened two Destination Maternity® multi-brand stores (including the reopening of the store at the Roseville Galleria Mall in California, which had been closed since late October 2010 due to a fire at the mall) and closed one store, which was related to a Destination Maternity store opening.  As of the end of November 2010, the Company operates 695 stores, 1,192 leased department locations and 1,887 total retail locations, compared to 721 stores, 980 leased department locations and 1,701 total retail locations operated at the end of November 2009.  The increase in leased department locations at the end of November 2010 versus the end of November 2009 predominantly reflects the opening of an additional 217 Sears and Kmart leased department locations in September and October 2010.

Days Adjustment Calendar Shift

Destination Maternity reports sales on a calendar month basis, rather than on a "4-5-4 retail fiscal calendar" where each fiscal week and fiscal month starts on a Sunday and ends on a Saturday.  Thus, for each calendar month, there is a "days adjustment calendar shift" which may help or hurt reported calendar month sales, comparable retail sales and comparable store sales due to different days of the week typically contributing more sales than other days of the week.  For November 2010, there was one less Sunday and one more Tuesday compared to November 2009.  The Company estimates this calendar shift unfavorably impacted its reported comparable retail sales for November 2010 by approximately 1.0 percentage points.  For November 2009, there was one more Monday and one less Saturday compared to November 2008.  The Company estimates this calendar shift unfavorably impacted its reported comparable retail sales for November 2009 by approximately 3.4 percentage points.

Destination Maternity Corporation is the world's largest designer and retailer of maternity apparel.  In the United States and Canada, as of November 30, 2010, Destination Maternity operates 1,887 retail locations, including 695 stores, predominantly under the tradenames Motherhood Maternity®, A Pea in the Pod®, and Destination Maternity®, and sells on the web through its DestinationMaternity.com and brand-specific websites.  Destination Maternity also distributes its Oh Baby by Motherhood® collection through a licensed arrangement at Kohl's® stores throughout the United States and on Kohls.com.  In addition, Destination Maternity is expanding internationally and has entered into exclusive store franchise and product supply relationships in India and the Middle East.

The Company cautions that any forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) contained in this press release or made from time to time by management of the Company, including those regarding net sales, comparable retail sales, comparable store sales, other results of operations, liquidity and financial condition, and various business initiatives, involve risks and uncertainties, and are subject to change based on various important factors.  The following factors, among others, in some cases have affected and in the future could affect the Company's financial performance and actual results and could cause actual results to differ materially from those expressed or implied in any such forward-looking statements: the continuation of economic recovery of the retail industry in general and of apparel purchases in particular, our ability to successfully manage our various business initiatives, the success of our international expansion, our ability to successfully manage and retain our leased department and licensed relationships and marketing partnerships, future sales trends in our existing store base and through the Internet, unusual weather patterns, changes in consumer spending patterns, raw material price increases, overall economic conditions and other factors affecting consumer confidence, demographics and other macroeconomic factors that may impact the level of spending for maternity apparel,  expense savings initiatives, our ability to anticipate and respond to fashion trends and consumer preferences, unanticipated fluctuations in our operating results, the impact of competition and fluctuations in the price, availability and quality of raw materials and contracted products, availability of suitable store locations, continued availability of capital and financing, our ability to hire and develop senior management and sales associates, our ability to develop and source merchandise, our ability to receive production from foreign sources on a timely basis, potential stock repurchases, potential debt prepayments, changes in market interest rates, war or acts of terrorism and other factors set forth in the Company's periodic filings with the Securities and Exchange Commission, or in materials incorporated therein by reference.

SOURCE Destination Maternity Corporation



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