Exhibit 99.1
FOR IMMEDIATE RELEASE
| CONTACT: |
| Mark E. Jarvis |
|
| Chief Financial Officer | |
|
| TUESDAY MORNING CORPORATION | |
|
| 972/387-3562 | |
|
|
| |
|
| Laurey Peat | |
|
| LAUREY PEAT + ASSOCIATES | |
|
| 214/871-8787 | |
TUESDAY MORNING CORPORATION ANNOUNCES 30% INCREASE IN NET INCOME FOR THE FIRST QUARTER
DALLAS, TX – April 24, 2003 — Tuesday Morning Corporation (NASDAQ: TUES) today reported net income for the first quarter ending March 31, 2003. Net income increased 30% to $6.1 million or $0.15 per diluted share for the first quarter of 2003 compared to $4.7 million or $0.11 per diluted share for the same quarter in 2002.
Kathleen Mason, President and CEO, stated, “We are pleased to report these strong earnings, which show a significant increase from a strong first quarter last year. In this environment that many retailers have cited as challenging, Tuesday Morning continues to outperform its peers.”
Tuesday Morning earlier reported that net sales increased 13.1% to $150.4 million for the first quarter of 2003 compared to $132.9 million for the same period in 2002. Comparable store sales increased 4.5% for the quarter.
Consistent with prior guidance, the Company projects sales growth of approximately 11% to 12% for the second quarter of 2003. Earnings estimates for the remainder of 2003 are unchanged.
About Tuesday Morning
Tuesday Morning is the leading closeout retailer of upscale, decorative home accessories and famous-maker gifts in the United States. The company opened its first store in 1974 and currently operates 530 stores in 43 states during periodic “sale events.” Tuesday Morning is nationally known for bringing its more than 6.5 million loyal customers a treasure hunt of high-end, first quality, brand name merchandise at prices 50% to 80% below department and specialty stores and catalogues.
This press release contains forward-looking statements, within the meaning of the federal securities laws and the Private Securities Litigation Reform Act of 1995, which are based on management’s current expectations, estimates and projections. Words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “estimates,” variations of such words and similar expressions are intended to identify such forward-looking statements. Forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those projected or implied in the forward-looking statements. Such risks and uncertainties include: the success of new store openings, competitive factors, access to merchandise and unanticipated changes in consumer demand and economic trends, as well as other risks detailed in the company’s filings with the Securities and Exchange Commission, including the Company’s Registration Statement on Form S-3 and Annual Report on Form 10-K.
2
Tuesday Morning Corporation and Subsidiaries
Consolidated Statement of Operations
(In thousands, except per share data)
|
| Three Months Ended March 31, |
| ||||||
|
| 2003 |
| 2002 |
| % |
| ||
|
| unaudited |
|
|
| ||||
|
|
|
|
|
|
|
| ||
Net Sales |
| $ | 150,355 |
| $ | 132,924 |
| +13 | % |
Cost of sales |
| 93,103 |
| 82,428 |
| +13 | % | ||
Gross profit |
| 57,252 |
| 50,496 |
| +13 | % | ||
|
|
|
|
|
|
|
| ||
Selling, general and administrative expenses |
| 45,194 |
| 39,738 |
| +14 | % | ||
|
|
|
|
|
|
|
| ||
Operating income |
| 12,058 |
| 10,758 |
| +12 | % | ||
|
|
|
|
|
|
|
| ||
Other income (expense): |
|
|
|
|
|
|
| ||
Interest expense |
| (2,402 | ) | (3,625 | ) | -34 | % | ||
Interest income |
| 28 |
| 129 |
| -78 | % | ||
Other income (expense), net |
| 219 |
| 333 |
| -34 | % | ||
Other income (expense) |
| (2,155 | ) | (3,163 | ) | -32 | % | ||
|
|
|
|
|
|
|
| ||
Income before income taxes |
| 9,903 |
| 7,595 |
| +30 | % | ||
|
|
|
|
|
|
|
| ||
Income taxes provision (benefit) |
| 3,820 |
| 2,925 |
| +31 | % | ||
|
|
|
|
|
|
|
| ||
Net income |
| $ | 6,083 |
| $ | 4,670 |
| +30 | % |
|
|
|
|
|
|
|
| ||
Earnings Per Share: |
|
|
|
|
|
|
| ||
Net income per common share: |
|
|
|
|
|
|
| ||
Basic |
| $ | 0.15 |
| $ | 0.12 |
|
|
|
Diluted |
| $ | 0.15 |
| $ | 0.11 |
|
|
|
|
|
|
|
|
|
|
| ||
Weighted average number of common shares: |
|
|
|
|
|
|
| ||
Basic |
| 40,273 |
| 39,813 |
|
|
| ||
Diluted |
| 41,193 |
| 41,007 |
|
|
| ||
Consolidated Balance Sheets
(in thousands)
|
| March 31, |
| Dec 31, |
| |||||
|
| 2003 |
| 2002 |
| 2002 |
| |||
|
| unaudited |
|
|
| |||||
Assets |
|
|
|
|
|
|
| |||
Current assets: |
|
|
|
|
|
|
| |||
Cash and cash equivalents |
| $ | 17,113 |
| $ | 19,877 |
| $ | 31,929 |
|
Inventories |
| 158,126 |
| 147,451 |
| 134,947 |
| |||
Prepaid expenses and other assets |
| 4,453 |
| 3,933 |
| 4,265 |
| |||
Deferred income taxes |
| 2,934 |
| 8 |
| 2,934 |
| |||
Total current assets |
| 182,626 |
| 171,269 |
| 174,075 |
| |||
|
|
|
|
|
|
|
| |||
Property and Equipment, net |
| 127,837 |
| 105,574 |
| 124,366 |
| |||
Less accumulated depreciation |
| (59,066 | ) | (50,998 | ) | (56,870 | ) | |||
Net property and equipment |
| 68,771 |
| 54,576 |
| 67,496 |
| |||
|
|
|
|
|
|
|
| |||
Other long-term assets: |
|
|
|
|
|
|
| |||
Dues from Officers |
| — |
| 102 |
| — |
| |||
Deferred financing costs |
| 2,702 |
| 3,396 |
| 2,879 |
| |||
Other assets |
| 841 |
| 418 |
| 844 |
| |||
|
|
|
|
|
|
|
| |||
Total Assets |
| $ | 254,940 |
| $ | 229,761 |
| $ | 245,294 |
|
|
|
|
|
|
|
|
| |||
Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
| |||
Current liabilities: |
|
|
|
|
|
|
| |||
Current portion, long-term debt |
| $ | — |
| $ | 24,726 |
| $ | 650 |
|
Revolving credit facility, current portion |
| — |
| — |
| — |
| |||
Accounts payable |
| 52,889 |
| 48,916 |
| 59,075 |
| |||
Other accrued liabilities |
| 28,374 |
| 19,523 |
| 25,790 |
| |||
Income taxes payable |
| 4,837 |
| 3,187 |
| 13,365 |
| |||
Total current liabilities |
| 86,100 |
| 96,352 |
| 98,880 |
| |||
|
|
|
|
|
|
|
| |||
Long-term debt, excl. current portion |
| 69,000 |
| 105,863 |
| 72,574 |
| |||
Revolving credit facility, excl. current portion |
| 20,000 |
| — |
| — |
| |||
Deferred taxes |
| 4,665 |
| 2,995 |
| 4,665 |
| |||
Total Liabilities |
| 179,765 |
| 205,210 |
| 176,119 |
| |||
|
|
|
|
|
|
|
| |||
Stockholders’ equity |
| 75,175 |
| 24,551 |
| 69,175 |
| |||
Total Liabilities and Stockholders’ Equity |
| $ | 254,940 |
| $ | 229,761 |
| $ | 245,294 |
|
3
Consolidated Statement of Cash Flows
(in thousands)
|
| Year-To-Date March 31, |
| ||||
|
| 2003 |
| 2002 |
| ||
|
| unaudited |
| ||||
Net cash flows from operating activities: |
|
|
|
|
| ||
Net income |
| $ | 6,083 |
| $ | 4,670 |
|
Adjustments to reconcile net income to net cash (used in) operating activities: |
|
|
|
|
| ||
Depreciation and amortization |
| 2,207 |
| 1,719 |
| ||
Amortization of financing fees |
| 177 |
| 509 |
| ||
Other non-cash charges |
| (11 | ) | — |
| ||
Net change in operating assets and liabilities |
| (35,589 | ) | (18,444 | ) | ||
|
|
|
|
|
| ||
Net cash used in operating activities |
| (27,133 | ) | (11,546 | ) | ||
|
|
|
|
|
| ||
Net cash flows from investing activities: |
|
|
|
|
| ||
Capital expenditures |
| (3,471 | ) | (15,357 | ) | ||
Other |
| — |
| 73 |
| ||
|
|
|
|
|
| ||
Net cash used in investing activities |
| (3,471 | ) | (15,284 | ) | ||
|
|
|
|
|
| ||
Net cash flows fro financing activities: |
|
|
|
|
| ||
Proceeds from revolving credit facility |
| 20,000 |
| — |
| ||
Repayment of long-term debt |
| (4,224 | ) | (35,616 | ) | ||
Other |
| 12 |
| 53 |
| ||
|
|
|
|
|
| ||
Net cash provided by (used in) financing act. |
| 15,788 |
| (35,563 | ) | ||
|
|
|
|
|
| ||
Net decrease in cash and cash equivalents |
| (14,816 | ) | (62,393 | ) | ||
|
|
|
|
|
| ||
Cash and cash equivalents at beginning of period |
| 31,929 |
| 82,270 |
| ||
|
|
|
|
|
| ||
Cash and cash equivalents at end of period |
| $ | 17,113 |
| $ | 19,877 |
|
4
