EXHIBIT 99.1
[GYMBOREE LOGO]
FOR IMMEDIATE RELEASE INVESTOR RELATIONS CONTACT:
Myles McCormick
Tel: 650/696-2933
investor_relations@gymboree.com
MEDIA RELATIONS CONTACT:
Jennifer Vides
Tel: 650/696-7443
media_relations@gymboree.com
THE GYMBOREE CORPORATION REPORTS FOURTH QUARTER AND FY 2002
RESULTS, AND FEBRUARY SALES RESULTS
BURLINGAME, Calif., Mar. 4, 2003 -- The Gymboree Corporation (Nasdaq: GYMB)
today reported net income of $10.6 million or $0.35 per diluted share for the
fourth fiscal quarter ended February 1, 2003, compared to net income of $10.5
million or $0.35 per diluted share for the fourth fiscal quarter ended February
2, 2002. For the 2002 fiscal year, The Gymboree Corporation had net income of
$21.8 million or $0.71 per diluted share, compared to net income of $4.6 million
or $0.16 per diluted share for the 2001 fiscal year.
"In 2002, we focused on strengthening our company's operational foundation and
on improving productivity, resulting in what we consider to be a banner year in
terms of sales performance and gross margin improvement," said Lisa Harper, The
Gymboree Corporation's chairman and chief executive officer. "Additionally, we
delivered innovation through fresh Gymboree product and the launch of the Janie
and Jack brand."
Harper continued: "Looking ahead to 2003, our focus will be on the roll-out of
the Janie and Jack concept, and on expanding the Gymboree retail chain to its
optimal size, leveraging the company's strengthened operational foundation."
NET SALES REPORT
Net sales from retail operations for the fourth fiscal quarter ended February 1,
2003, were $154 million, an increase of 2.2% compared to the $150.7 million in
net sales for the same period last year. Comparable store sales for the quarter
were flat compared to sales reported during the fourth fiscal quarter last year.
Total net sales, including sales from Play & Music operations, for the fourth
fiscal quarter ended February 1, 2003 were $158.5 million, an increase of 2.1%
compared to the $155.2 million in net sales for the same period last year.
For the 52 weeks ended February 1, 2003, net sales from retail operations were
$531.9 million, an increase of 5.1% compared to the $506 million in net sales
reported for the same period last year. Comparable store sales for the 52-week
period increased 4% compared to the sales reported for the same period last
year. Total net sales, including sales from Play & Music operations, for the 52
weeks ended February 1, 2003, were $546.8 million, an increase of 5.2% compared
to the $520 million in net sales reported for the same period last year.
FEBRUARY RETAIL SALES
The Gymboree Corporation also reported that comparable store sales from retail
operations for the four-week period ended March 1, 2003, decreased by 2.0%
compared to sales reported for the same period last year. Net sales for the
four-week period were $37.3 million, compared to net sales of $37.1 million for
the four weeks ended March 2, 2002.
BUSINESS OUTLOOK
The Gymboree Corporation projects comparable store sales from retail operations
for the first fiscal quarter to be flat to slightly down, with comparable store
sales decreases in the mid single digits for the month of March and comparable
store sales increases in the mid single digits for the month of April. Looking
forward to the balance of the year, the Company expects comparable store sales
increases to be in the low single digits.
The Company also reiterated earnings guidance for the first and second quarters
of 2003 and for fiscal year 2003, and provided an update to earnings guidance
for the third and fourth quarters. It expects earnings to be in the range of
$0.22 to $0.24 per diluted share for the first quarter, and $(0.04) to $(0.02)
for the second quarter. Earnings per diluted share for the third and fourth
quarters are expected to be in the range of $0.33 to $0.35, and $0.41 to $0.43,
respectively. As a result, earnings per diluted share for the fiscal year 2003
are expected in the range of $0.92 to $1.00.
MANAGEMENT PRESENTATION
Interested parties are invited to listen to a discussion of fourth quarter and
year-end results on a conference call broadcast live over the Internet at 1:30
Pacific Time (4:30 Eastern) on Tuesday, March 4. To listen, please log on to
gymboree.com, and click on "Our Company," and "Investor Relations," and follow
the link. A replay of the Web cast will be available at the same Web site
shortly after the call and will remain available through midnight Eastern Time
on Tuesday, March 11, 2003. A replay of the call will be available on our Web
site at the same location as the 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 March 1, 2003, the
Company operated a total of 583 stores: 572 Gymboree(R) retail stores (524 in
the United States, 24 in Canada, and 24 in Europe) and 11 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 more than 525 franchised and company-operated
centers in the United States and 23 other countries.
FORWARD-LOOKING STATEMENTS
The foregoing sales figures for February, the fourth fiscal quarter and fiscal
year 2002, are un-audited and subject to quarter-end and year-end adjustment,
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 concepts, marketing activity 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 YEAR ENDED
---------------------------------- ----------------------------------
FEBRUARY 1, FEBRUARY 2, FEBRUARY 1, FEBRUARY 2,
2003 2002 2003 2002
----------- ----------- ----------- -----------
Net sales:
Retail $ 154,011 $ 150,722 $ 531,859 $ 505,969
Play & music 4,443 4,498 14,940 13,977
----------- ----------- ----------- -----------
158,454 155,220 546,799 519,946
Cost of goods sold, buying
& occupancy expenses (87,955) (89,050) (317,013) (328,101)
----------- ----------- ----------- -----------
Gross profit 70,499 66,170 229,786 191,845
S, G & A (53,438) (48,478) (194,050) (180,792)
----------- ----------- ----------- -----------
Operating income 17,061 17,692 35,736 11,053
Foreign exchange gains (losses) (210) (186) 174 (432)
Net interest income (expense) 432 (461) (445) (3,174)
----------- ----------- ----------- -----------
Income before income taxes 17,283 17,045 35,465 7,447
Income tax expense (6,654) (6,562) (13,654) (2,867)
----------- ----------- ----------- -----------
Net income $ 10,629 $ 10,483 $ 21,811 $ 4,580
=========== =========== =========== ===========
Net income per share:
Basic $ 0.36 $ 0.37 $ 0.75 $ 0.16
Diluted $ 0.35 $ 0.35 $ 0.71 $ 0.16
Weighted average shares outstanding:
Basic 29,179 28,628 28,992 28,326
Diluted 30,779 30,067 30,633 29,377
Number of stores at end of period 584 580 584 580
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
February 1, FEBRUARY 2,
2003 2002
------------ ------------
CURRENT ASSETS
Cash and investments $ 60,630 $ 8,429
Accounts receivable 7,506 7,693
Merchandise inventories 62,505 63,584
Prepaid expenses and deferred taxes 10,352 14,240
------------ ------------
Total current assets 140,993 93,946
------------ ------------
PROPERTY AND EQUIPMENT, NET 106,552 108,129
LEASE RIGHTS, DEFERRED TAXES AND OTHER ASSETS 7,213 17,554
------------ ------------
TOTAL ASSETS $ 254,758 $ 219,629
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CURRENT LIABILITIES
Current portion of long term debt $ 0 $ 685
Accounts payable 27,194 20,261
Accrued liabilities 37,582 23,732
------------ ------------
Total current liabilities 64,776 44,678
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LONG TERM LIABILITIES
Long term debt, net of current portion 0 8,830
Deferred rent and other liabilities 20,998 23,692
STOCKHOLDERS' EQUITY 168,984 142,429
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 254,758 $ 219,629
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