[GYMBOREE LOGO]
EMBARGOED UNTIL 1:00 PM PST, TUESDAY, MAY 20, 2003
INVESTOR RELATIONS CONTACT:
Myles McCormick
Tel: 650/696-2933
myles_mccormick@gymboree.com
MEDIA RELATIONS CONTACT:
Jennifer Bonzagni Marshall
Tel: 650/373-7637
jennifer_bonzagni@gymboree.com
THE GYMBOREE CORPORATION REPORTS FIRST QUARTER 2003 RESULTS
BURLINGAME, Calif., May 20, 2003 - The Gymboree Corporation (NASDAQ: GYMB) today
reported net income of $7.3 million or $0.24 per diluted share for the first
fiscal quarter ended May 3, 2003, compared to $6.1 million or $0.20 per diluted
share for the first fiscal quarter ended May 4, 2002. Net sales from retail
operations for the first fiscal quarter of 2003 were $136.1 million, an increase
of 5% compared to net sales from retail operations of $129.6 million in the
first fiscal quarter last year. Comparable store sales for the 13-week period
ended May 3, 2003, increased 2%, compared to a 4% increase in comparable store
sales for the same period last year. Total net sales, including sales from
Gymboree Play & Music operations, were $139.5 million, an increase of 4%
compared to total net sales of $133.6 million in the first fiscal quarter last
year.
"We've consistently delivered on our promise to provide great product and
service to our customers and, as a result, we were able to hit the first quarter
expectations we set last year," said Lisa Harper, chairman and chief executive
officer, The Gymboree Corporation.
BUSINESS OUTLOOK
The Gymboree Corporation provided guidance for upcoming comparable store sales.
The Company projects that comparable store sales in May will be in the range of
flat to positive low single digits compared to the same period last year. It
also anticipates comparable store sales in the second fiscal quarter to be in
the positive low single digits.
The Company reaffirmed its earnings guidance for the second, third and fourth
quarters: the Company expects earnings per diluted share to be in the range of
($0.04) to ($0.02), $0.33 to $0.35, and $0.41 to $0.43, respectively. For the
full fiscal year, the Company now expects earnings per diluted share to be in
the range of $0.94 to $1.00.
MANAGEMENT PRESENTATION
A discussion of first quarter 2003 earnings results will be available to
interested parties at 1:30 p.m. Pacific (4:30 p.m. Eastern) on Tuesday, May 20.
To listen to the live broadcast over the Internet, please log on to
gymboree.com, click on "Our Company" at the bottom of the page, go to "Investor
and Media Relations" and then "Conference Calls & Web casts." A replay of the
call will be available through midnight Eastern on May 27, 2003, at
703-925-2533, pass code 6414309, as well as on our Web site at the same location
as the live Web cast.
ABOUT THE GYMBOREE CORPORATION
The Gymboree Corporation's specialty retail brands offer unique, high-quality
products delivered with personalized customer service. As of May 3, 2003, the
Company operated a total of 589 stores: 576 Gymboree(R) retail stores (528 in
the United States, 24 in Canada, and 24 in Europe) and 13 Janie and Jack(TM)
retail shops in the United States. The Company also operates online stores at
gymboree.com and janieandjack.com, and offers directed parent-child
developmental play programs at 536 franchised and company-operated centers in
the United States and 24 other countries.
FORWARD-LOOKING STATEMENTS
The foregoing sales figures for the first fiscal quarter of 2003 are un-audited,
and could differ materially from those indicated. The foregoing paragraphs
contain forward-looking statements relating to The Gymboree Corporation's
anticipated sales growth and future financial performance. These are
forward-looking statements for purposes of the safe harbor provisions under the
Private Securities Litigation Reform Act of 1995. Actual results could differ
materially as a result of a number of factors, including customer reactions to
new merchandise and service levels, success in meeting our delivery targets, the
level of our promotional activity, our gross margin achievement, our ability to
appropriately manage inventory, general economic conditions, and competitive
market conditions. Other factors that may cause actual results to differ
materially include those set forth in the reports that we file from time to time
with the Securities and Exchange Commission.
# # #
THE GYMBOREE CORPORATION
CONDENSED CONSOLIDATED INCOME STATEMENTS
(IN THOUSANDS, EXCEPT PER SHARE AND STORE DATA)
(UNAUDITED)
13 WEEKS ENDED
------------------------
MAY 3, MAY 4,
2003 2002
--------- ---------
Net sales:
Retail 136,082 $ 129,612*
Play & music 3,373 3,989
--------- ---------
139,455 133,601
Cost of goods sold, including buying
& occupancy expenses (80,634) (76,447)*
--------- ---------
Gross profit 58,821 57,154
Selling, general and administrative expenses (46,926) (47,393)
--------- ---------
Operating income 11,895 9,761
Foreign exchange gains (losses) (226) 342
Interest income (expense), net 137 (201)
--------- ---------
Income before income taxes 11,806 9,902
Income tax expense (4,545) (3,812)
--------- ---------
Net income $ 7,261 $ 6,090
========= =========
Net income per share:
Basic $ 0.25 $ 0.21
Diluted $ 0.24 $ 0.20
Weighted average shares outstanding:
Basic 29,314 28,796
Diluted 30,609 30,473
Number of stores at end of period 589 577
- ----------
* Prior year amounts were reclassified to conform to the 2003 presentation.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
(UNAUDITED)
MAY 3, FEBRUARY 1, MAY 4,
2003 2003 2002
-------- ---------- --------
CURRENT ASSETS
Cash and cash equivalents $ 60,133 $ 60,628 $ 23,644
Accounts receivable 7,610 7,506 7,019
Merchandise inventories 50,504 62,561 51,485
Prepaid expenses and deferred taxes 11,537 10,764 28,440
-------- -------- --------
Total current assets 129,784 141,459 110,588
-------- -------- --------
PROPERTY AND EQUIPMENT, NET 104,733 106,464 105,254
LEASE RIGHTS, DEFERRED TAXES AND OTHER ASSETS 6,767 7,213 4,105
-------- -------- --------
TOTAL ASSETS $241,284 $255,136 $219,947
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CURRENT LIABILITIES
Current portion of long term debt $ - $ - $ 699
Accounts payable 10,252 27,150 10,616
Accrued liabilities 32,462 37,570 26,409
-------- -------- --------
Total current liabilities 42,714 64,720 37,724
-------- -------- --------
LONG TERM LIABILITIES
Long term debt, net of current portion -- -- 8,603
Deferred rent and other liabilities 20,734 20,998 23,877
STOCKHOLDERS' EQUITY 177,836 169,418 149,743
-------- -------- --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $241,284 $255,136 $219,947
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