Exhibit 99.1
FOR IMMEDIATE RELEASE
CONTACT: | | Loren K. Jensen |
| | Chief Financial Officer |
| | TUESDAY MORNING CORPORATION |
| | 972/934-7299 |
| | |
| | Laurey Peat |
| | LAUREY PEAT + ASSOCIATES |
| | 214/871-8787 |
TUESDAY MORNING CORPORATION
ANNOUNCES FIRST QUARTER 2005 RESULTS; SALES UP 10%
DALLAS, TX – April 21, 2005 — Tuesday Morning Corporation (NASDAQ: TUES) today reported that net income for the first quarter ended March 31, 2005 was $6.7 million, which included a $2.4 million after-tax charge related to lease accounting adjustments, compared to $8.2 million reported in the same prior-year quarter. Diluted earnings per share for the March 31, 2005 quarter were 16 cents, including the lease adjustment charge, compared to 20 cents in the same quarter last year. Net income and diluted earnings per share, excluding the after-tax lease adjustment, were $9.1 million and 22 cents, representing an 11% and 10% increase over last year’s first quarter net income and diluted earnings per share, respectively.
As previously reported, net sales increased 10% to $185.6 million for the first quarter of 2005, compared to $168.6 million for the same period in 2004.
“We are pleased to report that Tuesday Morning has once again delivered favorable earnings results in spite of a difficult home furnishings environment. This demonstrates our ability to anticipate and respond effectively to opportunities and changes in the marketplace,” said Kathleen Mason, President and Chief Executive Officer. “Traffic improved from the fourth quarter, and our inventories are in excellent shape for the spring and summer shopping seasons.”
Tuesday Morning management will review first quarter financial results in a teleconference call April 21, 2005 at 10:00 a.m. Eastern Time.
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 673 stores in 43 states during periodic “sale events.” Tuesday Morning is nationally known for bringing its more than 7.5 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 for the period ending December 31, 2004.
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Tuesday Morning Corporation
Consolidated Statement of Income
(In thousands, except per share data)
| | Three Months Ended March 31, | |
| | 2005 | | 2004 | |
| | unaudited | |
Net Sales | | $ | 185,594 | | $ | 168,597 | |
Cost of sales | | 113,036 | | 102,585 | |
Gross profit | | 72,558 | | 66,012 | |
| | | | | |
Selling, general and administrative expenses | | 62,122 | | 52,531 | |
| | | | | |
Operating income | | 10,436 | | 13,481 | |
| | | | | |
Other income (expense): | | | | | |
Interest expense | | (206 | ) | (411 | ) |
Interest income | | 34 | | 4 | |
Other income (expense), net | | 193 | | 241 | |
Other income (expense) | | 21 | | (166 | ) |
| | | | | |
Income before income taxes | | 10,457 | | 13,315 | |
| | | | | |
Income taxes provision (benefit) | | 3,791 | | 5,126 | |
| | | | | |
Net income | | $ | 6,666 | | $ | 8,189 | |
| | | | | |
Earnings Per Share: | | | | | |
Net income per common share: | | | | | |
Basic | | $ | 0.16 | | $ | 0.20 | |
Diluted | | $ | 0.16 | | $ | 0.20 | |
| | | | | |
Weighted average number of common shares: | | | | | |
Basic | | 41,129 | | 40,980 | |
Diluted | | 41,740 | | 41,742 | |
Consolidated Balance Sheet
(in thousands)
| | March 31, | | Dec 31,
2004 | |
| | 2005 | | 2004 | | |
| | unaudited | | | |
Assets | | | | | |
Current assets: | | | | | | | |
Cash and cash equivalents | | $ | 14,295 | | $ | 7,096 | | $ | 45,067 | |
Inventories | | 212,587 | | 195,194 | | 189,132 | |
Prepaid expenses and other assets | | 7,388 | | 5,355 | | 5,169 | |
Deferred income taxes | | 5,991 | | 5,106 | | 5,991 | |
Total current assets | | 240,261 | | 212,751 | | 245,359 | |
| | | | | | | |
Property and Equipment, net | | 86,920 | | 78,484 | | 86,332 | |
| | | | | | | |
Other long-term assets: | | | | | | | |
Deferred financing costs | | 809 | | 806 | | 877 | |
Other assets | | 3,189 | | 998 | | 3,552 | |
| | | | | | | |
Total Assets | | $ | 331,179 | | $ | 293,039 | | $ | 336,120 | |
| | | | | | | |
Liabilities and Stockholders’ Equity | | | | | | | |
Current liabilities: | | | | | | | |
Current portion, long-term debt | | — | | 7,000 | | — | |
Accounts payable | | 76,568 | | 83,256 | | 72,722 | |
Other accrued liabilities | | 32,477 | | 30,133 | | 39,714 | |
Income taxes payable | | 4,952 | | 6,490 | | 17,483 | |
Total current liabilities | | 113,997 | | 126,879 | | 129,919 | |
| | | | | | | |
Long-term debt, excluding current portion | | — | | 20,000 | | — | |
Deferred rent - long-term | | 4,249 | | — | | — | |
Deferred taxes - long-term | | 9,051 | | 5,641 | | 9,051 | |
Total Liabilities | | 127,297 | | 152,520 | | 138,970 | |
| | | | | | | |
Stockholders’ equity | | 203,882 | | 140,519 | | 197,150 | |
Total Liabilities and Stockholders’ Equity | | $ | 331,179 | | $ | 293,039 | | $ | 336,120 | |
Consolidated Statement of Cash Flows
(in thousands)
| | Three Months ended March 31, | |
| | 2005 | | 2004 | |
| | unaudited | |
Net cash flows from operating activities: | | | | | |
Net income | | $ | 6,666 | | $ | 8,189 | |
Adjustments to reconcile net income to net cash (used in) operating activities: | | | | | |
Depreciation and amortization | | 3,459 | | 2,670 | |
Amortization of financing fees | | 43 | | 101 | |
Cumulative effect of lease accounting adj. | | 3,898 | | — | |
Other non-cash charges | | (28 | ) | — | |
Net change in operating assets and liabilities | | (40,857 | ) | (48,499 | ) |
| | | | | |
Net cash used in operating activities | | (26,819 | ) | (37,539 | ) |
| | | | | |
Net cash flows from investing activities: | | | | | |
Capital expenditures | | (4,047 | ) | (6,279 | ) |
Other | | — | | — | |
| | | | | |
Net cash used in investing activities | | (4,047 | ) | (6,279 | ) |
| | | | | |
Net cash flows from financing activities: | | | | | |
Proceeds from revolving credit facility | | — | | 27,000 | |
Repayment of long-term debt | | — | | — | |
Other | | 94 | | 378 | |
| | | | | |
Net cash provided by (used in) financing act. | | 94 | | 27,378 | |
| | | | | |
Net decrease in cash and cash equivalents | | (30,772 | ) | (16,440 | ) |
| | | | | |
Cash and cash equivalents at beginning of period | | 45,067 | | 23,536 | |
| | | | | |
Cash and cash equivalents at end of period | | $ | 14,295 | | $ | 7,096 | |
