Exhibit 99.1
[THE BUCKLE, INC. LOGO] THE BUCKLE, INC.
2407 W. 24th St. Kearney, NE 68845
P.O. Box 1480 Kearney, NE 68848-1480
PHONE: 308-236-8491
FAX: 308-236-4493
FOR IMMEDIATE RELEASE: March 3, 2005 WEB: www.buckle.com
CONTACT: Karen B. Rhoads, Chief Financial Officer
The Buckle, Inc.
308/236-8491
THE BUCKLE, INC. REPORTS FEBRUARY 2005 SALES AND
FOURTH QUARTER 2004 NET PROFIT; PROVIDES LEASE ACCOUNTING RESTATEMENT
KEARNEY, NE -- The Buckle, Inc. (NYSE: BKE) announced today that sales for the
four-week period ended February 26, 2005 increased 11.1 percent to $32.6 million
from sales of $29.3 million in the corresponding four-week period ended February
28, 2004. Comparable store sales, for stores open at least one full year,
increased 6.4 percent for the same period.
Net sales for the fourth quarter ended January 29, 2005, increased 8.6 percent
to $145.6 million from $134.1 million for the fourth quarter of fiscal 2003.
Comparable store net sales, for stores open at least one full year, increased
3.7 percent for the fiscal quarter.
Net sales for the 52 weeks of fiscal 2004 increased 11.4 percent to $470.9
million from $422.8 million in the 52 weeks of fiscal 2003. Comparable store net
sales increased 6.3 percent for the 2004 fiscal year. Beginning with the
four-week period ended May 1, 2004, the Company changed its method of reporting
comparable store sales to exclude Internet sales.
During fiscal 2004, the Company purchased 130,700 shares of the Company's common
stock at an average price of $26.29 per share. These shares were purchased
pursuant to the corporate stock repurchase program authorized by the Board of
Directors on December 27, 2000. The Company has 18,675 shares remaining to be
purchased to complete this authorization.
Net income for the fourth quarter of fiscal 2004 was $17.1 million, or $0.79 per
share ($0.76 per share on a diluted basis), compared with $15.0 million, or
$0.71 per share ($0.69 per share on a diluted basis) for the fourth quarter of
fiscal 2003.
Net income for the fiscal year ended January 29, 2005 was $43.2 million or $2.02
per share ($1.94 per share on a diluted basis), compared with $33.7 million or
$1.60 per share ($1.56 per share on a diluted basis) for the fiscal year ended
January 31, 2004. As of January 29, 2005, the Company operated 327 stores versus
316 stores as of January 31, 2004.
The Company also announced today that it will make corrections to its accounting
for leases following review of the guidance set forth in the SEC's February 7,
2005 letter from the Office of the Chief
Accountant to the Center for Public Company Audit Firms which clarified certain
issues related to the accounting for operating leases and leasehold
improvements. The Company has determined that its method of accounting for
construction allowances and rent holidays is not consistent with the accounting
as described in the SEC's letter and is also correcting its financial statements
for other adjustments to straight-line rent expense. Accordingly, the Company
plans to restate its financial statements to correct its accounting for these
items.
In prior periods, the Company reported the unamortized portion of construction
allowances from landlords as a reduction of property and equipment on its
balance sheet rather than as a deferred rent credit. In addition, the Company's
past statements of cash flows reported construction allowances as a reduction of
capital expenditures within cash flows from investing activities, rather than
cash flows from operating activities. To correct the accounting for construction
allowances, the Company's rent expense was decreased by $2.5 million and
depreciation expense increased by $2.6 million, for a net impact of $0.1 million
for fiscal year ended January 29, 2005. Further, the Company's net property and
equipment increased by $16.2 million, and there was an increase in accrued store
operating expenses and other long-term liabilities of $16.5 million at January
29, 2005. Shareholders' equity was reduced $0.3 million, net of tax, to reflect
the cumulative prior period effect of these adjustments as of January 29, 2005.
In prior periods, the Company recognized rent expense for leases beginning on
the opening date of store operations, which had the effect of excluding the
store build-out period (during which the Company typically makes no rent
payments) from the period used for calculating rent. To correct the "rent
holidays" and other adjustments to straight-line rent expense, management has
recorded the impact of adjusting these items to reflect rent on a straight-line
basis as a decrease to currently reported net earnings of $71,000, net of tax,
an increase in the straight-line rent liability of $5.6 million, an increase in
the deferred asset of $2.1 million and a reduction in Stockholders' equity of
$3.4 million, net of tax, to reflect the cumulative prior period effect of this
change.
The corrections in accounting for lease-related issues reduced reported diluted
earnings per share $0.01 for the year ended January 29, 2005.
The Buckle will restate the Company's financial statements previously issued in
its Annual Report on Form 10-K for the year ended January 31, 2004 and its
interim reports on Form 10-Q for each of the first three quarters of fiscal
2004. The Company plans to quantify these restatements in a Form 10-K/A and
amended Forms 10-Q to be filed with the SEC as soon as administratively
possible. The Company also plans to file with the SEC a report on Form 8-K
indicating that the financial statements reported in the Company's Form 10-K for
the fiscal year ended January 31, 2004 and Forms 10-Q for fiscal 2004 should no
longer be relied upon. Investors or other interested parties should refer to the
Company's filings on Form 10-K/A and Forms 10-Q/A, upon filing with the SEC, for
amended information.
The Company has restated the accompanying statements of income and selected
financial data to reflect the corrections for the lease accounting policies as
discussed above.
Headquartered in Kearney, Nebraska, The Buckle, Inc. is a retailer of casual
apparel, footwear and accessories for young men and women. It currently operates
327 retail stores in 38 states compared with 316 stores in 38 states at this
same time a year ago.
To listen to the Company's recorded quarterly earnings commentary, please call
(308) 238-2500.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995; All forward looking statements made by the Company involve material risks
and uncertainties
and are subject to change based on factors which may be beyond the Company's
control. Accordingly, the Company's future performance and financial results may
differ materially from those expressed or implied in any such forward-looking
statements. Such factors include, but are not limited to, those described in the
Company's filings with the Securities and Exchange Commission. The Company does
not undertake to publicly update or revise any forward-looking statements even
if experience or future changes make it clear that any projected results
expressed or implied therein will not be realized.
Note: News releases and other information on The Buckle, Inc. can be accessed
at www.buckle.com on the Internet.
Financial Table to Follow
THE BUCKLE, INC.
STATEMENTS OF INCOME
(DOLLAR AMOUNTS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
THIRTEEN WEEKS ENDED FIFTY-TWO WEEKS ENDED
--------------------------- ---------------------------
JANUARY 29, JANUARY 31, JANUARY 29, JANUARY 31,
2005 2004 2005 2004
SALES, Net of returns and allowances of
$35,028, $32,364 and $31,826, respectively $145,593 $134,099 $470,937 $422,820
COST OF SALES (Including buying, distribution
and occupancy costs) 87,261 82,318 299,958 280,004
-------- -------- -------- --------
Gross profit 58,332 51,781 170,979 142,816
-------- -------- -------- --------
OPERATING EXPENSES:
Selling 27,490 25,356 89,008 79,668
General and administrative 6,035 5,047 18,599 15,045
-------- -------- -------- --------
33,525 30,403 107,607 94,713
-------- -------- -------- --------
INCOME FROM OPERATIONS 24,807 21,378 63,372 48,103
OTHER INCOME, Net 1,817 1,840 4,470 4,688
-------- -------- -------- --------
INCOME BEFORE INCOME TAXES 26,624 23,218 67,842 52,791
PROVISION FOR INCOME TAXES 9,478 8,255 24,613 19,112
-------- -------- -------- --------
NET INCOME $ 17,146 $ 14,963 $ 43,229 $ 33,679
======== ======== ======== ========
EARNINGS PER SHARE:
Basic $ 0.79 $ 0.71 $ 2.02 $ 1.60
======== ======== ======== ========
Diluted $ 0.76 $ 0.69 $ 1.94 $ 1.56
======== ======== ======== ========
JANUARY 29, JANUARY 31,
2005 2004
----------- -----------
SELECTED FINANCIAL DATA
Cash and cash equivalents $173,897 $119,976
Inventory $ 68,330 $ 61,156
Property and equipment $ 82,414 $ 82,018
Accounts payable $ 12,665 $ 14,207