WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
February 4, 2004
CACHE INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Florida 0-10345 59-1588181
- ----------------- ---------------------- ----------------
(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification
incorporation) Number)
1440 Broadway, New York, NY 10018
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(Address of principal executive offices)
Registrant's telephone number: (212) 575-3200
ITEM 5. OTHER EVENTS
See the attached press release, which is incorporated herein by reference,
regarding Fiscal 2003 earnings, filed as Exhibit 99.1
ITEM 12. FINANCIAL STATEMENTS AND EXHIBITS
(1) Financial Statements of Businesses Acquired
None
(2) Pro Forma Financial Information
None
(3) Exhibits
99.1 Press release issued by Cache, Inc. on February 4, 2004
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: February 4, 2004 CACHE INC.
By: /s/ Brian Woolf
--------------------------------------------
Brian Woolf
On behalf of Cache, Inc. and his capacity as
Chairman and Chief Executive Officer
(Principal Executive Officer)
By: /s/ Thomas E. Reinckens
--------------------------------------------
Thomas E. Reinckens
On behalf of Cache, Inc. and in his capacity
as President and Chief Operating Officer
(Principal Financial and Accounting Officer)
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INDEX OF EXHIBITS
Exhibit Description Page
- ------- ---------------------------------- ----
99.1 Press Release issued by Cache Inc. 5
on February 4, 2004
<page>
FEBRUARY 4, 2004
FOR IMMEDIATE RELEASE
CACHE, INC.
NASDAQ COMMON STOCK SYMBOL CACH.
CACHE REPORTS RECORD FISCAL 2003 EARNINGS OF $1.13 PER SHARE
Company Reports Record Sales and Earnings for 2003; Exceeding Expectations
Company Introduces Fiscal 2004 Guidance Range of $1.28 -$1.31
New York, New York - February 4, 2004 - Cache Inc., (NASDAQ: CACH), a
specialty chain of women's apparel stores with 255 stores open, reported results
for the thirteen and fifty-two week periods ended December 27, 2003.
For the thirteen week period ended December 27, 2003:
* Net sales rose by 10.1% to $64.6 million compared to $58.7 million in
2002 and comparable store sales gained 4%;
* Operating income increased by 28.5% to $8.7 million, or 13.5% of net
sales, as compared to $6.8 million, or 11.6% of net sales in 2002;
* Net income grew by 31.6% to $5.3 million, or 8.2% of net sales, as
compared to $4.0 million, or 6.9% of net sales in 2002; and
* Diluted earnings per share increased by 21.4% to $0.51 compared to $0.42
in 2002; exceeding the First Call consensus estimate of $0.49.
Mr. Brian Woolf, Cache's Chairman commented: "Fiscal 2003 was a very
rewarding year for Cache, Inc. We reported record earnings for both the fourth
quarter and year, exceeding both internal and external expectations. For 2003,
net income rose 24%. We also achieved a 240 basis point increase in gross profit
margin, with this improvement surpassing our targeted goal. Our performance
demonstrates the success of the many merchandising and marketing initiatives
we have implemented. Clearly, our unique store format and compelling offerings
have made Cache and Lillie Rubin destinations for women shoppers across the
country."
For the fifty-two week period:
* Net sales rose by 8.0% to $216.3 million compared to $200.3 million in
2002 and comparable store sales gained 3%;
* Operating income increased by 25.1% to $17.9 million, or 8.3% of net
sales compared to $14.3 million, or 7.1% of net sales, in 2002;
* Net income grew by 24.0% to $11.1 million, or 5.1% of net sales compared
to $8.9 million, or 4.5% of net sales in 2002; and
* Diluted earnings per share increased by 21.5% to $1.13 compared to $0.93
in 2002; exceeding the First Call consensus estimate of $1.09.
Additionally, during 2003 the Company:
* Opened 22 Cache and 2 Lillie Rubin stores and at year-end operated 255
stores in 42 states;
* Completed 18 remodels with 30% of its Cache store base in the new store
format at year-end;
* Introduced sportswear in its Lillie Rubin stores, which has prompted an
accelerated store opening plan in Fiscal 2004:
Gross profit in the fourth quarter rose by 19.2% to $30.4 million, or 47.0%
of net sales, compared to $25.5 million, or 43.4% of net sales, in the fourth
quarter of 2002. The improvement in gross profit margin resulted from
increased merchandising margins mainly attributed to sourcing improvements. In
total, operating expenses were $21.6 million, or 33.5% of net sales compared to
$18.7 million, or 31.8% of net sales in the fourth quarter of 2002.
<page>
Fiscal year gross profit rose by 14.0% to $95.5 million, or 44.2% of net
sales, compared to $83.8 million, or 41.8% of net sales, in fiscal 2002. In
total, operating expenses were $77.6 million, or 35.9% of net sales compared to
$69.5 million, or 34.7% of net sales in Fiscal 2002.
The Company's balance sheet remained strong. At December 27, 2003, cash
and marketable securities totaled $36.6 million, rising $11.9 million from $24.7
million at December 28, 2002. Inventory was on plan and current at $26.7
million, as compared to $22.1 million at December 28, 2002. Of the 21.1% rise
in inventory, 11% was due to the growth in new stores with the remaining
increase planned given that the Company operated at unusually low inventory
levels in the year ago period. Working capital increased by $14.3 million to
$41.0 million from $26.7 million at December 28, 2002.
Mr. Woolf added: "As we look ahead, we remain excited and enthusiastic
about our prospects in the current year and beyond. Increasing our confidence
in the near term is the 10% increase we reported for January comparable store
sales. This gain reflects a strong start to the year with robust results
recorded across all merchandise categories. Over the long term, we continue
to believe that we are in the beginning stages of our expansion and expect the
platform we have created to enable us to report sustained growth and enhance
shareholder value well into the future."
A table summarizes financial results follows:
Fifty-Two Weeks Ended Thirteen Weeks Ended
--------------------- --------------------
Dec. 27, Dec. 28, Dec. 27, Dec. 28,
2003 2002 2003 2002
--------- --------- -------- --------
($ Thousands, except for per share data)
Sales $ 216,256 $ 200,315 $ 64,622 $ 58,704
Operating income $ 17,905 $ 14,313 $ 8,720 $ 6,785
Net income $ 11,089 $ 8,941 $ 5,293 $ 4,022
Basic earnings per share $ 1.17 $ 0.98 $ 0.53 $ 0.44
Diluted earnings per share $ 1.13 $ 0.93 $ 0.51 $ 0.42
Basic weighted average
shares outstanding 9,504,000 9,100,000 9,970,000 9,100,000
Diluted weighted average
shares outstanding 9,814,000 9,632,000 10,313,000 9,632,000
Guidance
- --------
The Company estimates Fiscal 2004 net sales in the range of $250 million
to $260 million compared to $216.3 million in Fiscal 2003. Fiscal 2004 diluted
earnings per share is currently estimated in the range of $1.28 to $1.31
compared to $1.13 in Fiscal 2003. For the first quarter, the Company estimates
net revenues to range between $55 million and $57 million compared to $48.1
million in the first quarter of Fiscal 2003. The Company estimates first
quarter 2004 diluted earnings per share in the range of $0.24 to $0.26, compared
to $0.17 in the first quarter of Fiscal 2003.
<page>
Store opening plans
- -------------------
The Company also noted that it plans to open 35 Cache and 10 Lillie Rubin
stores for a total of 45 new stores planned for Fiscal 2004. Currently, the
Company plans to open between 15 and 20 stores in the first half of the year,
including a Cache store located in The Shops at Columbus Circle, New York. At
year-end 2004, the Company expects to operate 300 stores, expanding square
footage by approximately 18% to 600,000 square feet.
January, 2004 comparable store sales
- ------------------------------------
Separately, the Company announced January 2004 comparable store sales.
Comparable store sales (sales for stores open at least one year or more)
increased 10% during the four week January 2004 period, as compared to the same
period in 2003. Total revenues for the four-week period ended January 25, 2004
increased $1.9 million, or 15.2% to $14.3 million.
Interested stockholders and other persons are invited to listen to the
fourth quarter earnings conference call scheduled for today, Wednesday, February
4, 2004 at 8:00 a.m. Eastern Time. To participate in Cache's conference call
dial 1-877-692-2592 approximately five minutes prior to the 8:00am Eastern
start time. The call will also be broadcast live over the Internet at
http://www.cache.com. An online archive will be available immediately following
the call and will be accessible until February 11, 2004.
Certain matters discussed within this press release may constitute
forward-looking statements within the meaning of the federal securities law.
Although Cache, Inc. believes the statements are based on reasonable
assumptions, there can be no assurance that these expectations will be attained.
Actual results and timing of certain events could differ materially from those
projected in or contemplated by the forward-looking statements due to a number
of factors, including, without limitation, industry trends, merchandise trends,
competition and the ability to obtain financing, as well as other risks outlined
from time to time in the filings of Cache, Inc., with the Securities and
Exchange Commission.
Financial Tables Follow:
For further information contact Thomas E. Reinckens, President, Chief
Operating Officer, Cache, Inc., 1440 Broadway, New York, New York 10018,
(212) 575-3246.
<page>
<table>
CACHE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<caption>
<s> December 28, December 28,
A S S E T S 2002 2003
-------------- --------------
CURRENT ASSETS <c> <c>
Cash and equivalents $ 10,287,000 $ 16,838,000
Marketable securities 14,392,000 19,746,000
Receivables, net 2,677,000 4,533,000
Notes receivable from related parties 321,000 ---
Inventories 22,065,000 26,724,000
Deferred income taxes and other tax assets 271,000 936,000
Prepaid expenses 1,020,000 1,239,000
-------------- --------------
Total Current Assets 51,033,000 70,016,000
EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET 18,553,000 25,010,000
OTHER ASSETS 817,000 873,000
DEFERRED INCOME TAXES, NET 349,000 ---
-------------- --------------
Total Assets $ 70,752,000 $ 95,899,000
============== ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 11,988,000 $ 14,411,000
Accrued compensation 3,629,000 4,674,000
Accrued liabilities 8,762,000 9,897,000
-------------- --------------
Total Current Liabilities 24,379,000 28,982,000
OTHER LIABILITIES 1,081,000 1,088,000
DEFERRED INCOME TAXES, net --- 687,000
STOCKHOLDERS' EQUITY
Common stock 91,000 100,000
Additional paid-in capital 19,609,000 28,361,000
Retained earnings 25,592,000 36,681,000
-------------- --------------
Total Stockholders' Equity 45,292,000 65,142,000
-------------- --------------
Total Liabilities and Stockholders' Equity $ 70,752,000 $ 95,899,000
============== ==============
</table>
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<table>
CACHE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE FIFTY - TWO WEEKS ENDED
<caption>
December 28, December 27,
2002 2003
-------------- --------------
<s> <c> <c>
NET SALES $ 200,315,000 $ 216,256,000
COST OF SALES, including occupancy and buying costs 116,510,000 120,732,000
-------------- --------------
GROSS PROFIT 83,805,000 95,524,000
-------------- --------------
EXPENSES
Store operating expenses 57,303,000 63,545,000
General and administrative expenses 12,189,000 14,074,000
-------------- --------------
TOTAL EXPENSES 69,492,000 77,619,000
-------------- --------------
OPERATING INCOME 14,313,000 17,905,000
-------------- --------------
OTHER INCOME
Interest income 260,000 259,000
Miscellaneous income (net) --- 14,000
-------------- --------------
TOTAL OTHER INCOME 260,000 273,000
-------------- --------------
INCOME BEFORE INCOME TAXES 14,573,000 18,178,000
INCOME TAX PROVISION 5,632,000 7,089,000
-------------- --------------
NET INCOME $ 8,941,000 $ 11,089,000
============== ==============
BASIC AND DILUTED EARNINGS PER SHARE:
BASIC EARNINGS PER SHARE $0.98 $1.17
============== ==============
DILUTED EARNINGS PER SHARE $0.93 $1.13
============== ==============
BASIC WEIGHTED AVERAGE SHARES OUTSTANDING 9,100,000 9,504,000
============== ==============
DILUTED WEIGHTED AVERAGE SHARES OUTSTANDING 9,632,000 9,814,000
============== ==============
NUMBER OF STORES OPEN AT END OF PERIOD 234 255
============== ==============
</table>
<page>
<table>
CACHE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THIRTEEN WEEKS ENDED
<caption>
December 28, December 27,
2002 2003
-------------- --------------
<s> <c> <c>
NET SALES $ 58,704,000 $ 64,622,000
COST OF SALES, including occupancy and buying costs 33,242,000 34,271,000
-------------- --------------
GROSS PROFIT 25,462,000 30,351,000
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EXPENSES
Store operating 15,733,000 17,462,000
General and administrative 2,944,000 4,169,000
-------------- --------------
TOTAL EXPENSES 18,677,000 21,631,000
-------------- --------------
OPERATING INCOME 6,785,000 8,720,000
-------------- --------------
OTHER INCOME
Interest income 41,000 68,000
Miscellaneous income --- ---
-------------- --------------
TOTAL OTHER INCOME 41,000 68,000
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INCOME BEFORE INCOME TAXES 6,826,000 8,788,000
INCOME TAX PROVISION 2,804,000 3,495,000
-------------- --------------
NET INCOME $ 4,022,000 $ 5,293,000
============== ==============
BASIC AND DILUTED EARNINGS PER SHARE:
BASIC EARNINGS PER SHARE $0.44 $0.53
============== ==============
DILUTED EARNINGS PER SHARE $0.42 $0.51
============== ==============
BASIC WEIGHTED AVERAGE SHARES OUTSTANDING 9,100,000 9,970,000
============== ==============
DILUTED WEIGHTED AVERAGE SHARES OUTSTANDING 9,632,000 10,313,000 9,218,000
============== ==============
NUMBER OF STORES OPEN AT END OF PERIOD 234 255
============== ==============
</table>
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