UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended JULY 30, 2005
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from ____________ to ____________
Commission File Number: 001-12951
THE BUCKLE, INC.
(Exact name of Registrant as specified in its charter)
NEBRASKA 47-0366193
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2407 WEST 24TH STREET, KEARNEY, NEBRASKA 68845-4915
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (308) 236-8491
_________________________________________________________________________
(Former name, former address and former fiscal year if changed since last
report)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). Yes [X] No [ ]
Indicate by check mark whether the registrant is a Shell Company (as defined in
Rule 12b-2 of the Exchange Act). Yes [ ] No [X]
The number of shares issued of the Registrant's Common Stock, outstanding as of
August 26, 2005 was 19,541,065 shares of Common Stock.
THE BUCKLE, INC.
FORM 10-Q
INDEX
Pages
-----
Part I. Financial Information (unaudited)
Item 1. Financial Statements 3
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 12
Item 3. Quantitative and Qualitative Disclosures About Market Risk 20
Item 4. Controls and Procedures 20
Part II. Other Information
Item 1. Legal Proceedings 21
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 21
Item 3. Defaults Upon Senior Securities 21
Item 4. Submission of Matters to a Vote of Security Holders 21
Item 5. Other Information 22
Item 6. Exhibits 22
Signatures 23
2
THE BUCKLE, INC.
BALANCE SHEETS
(DOLLAR AMOUNTS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS)
JULY 30, JANUARY 29,
2005 2005
--------- -----------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 82,359 $ 173,897
Investments 27,506 25,523
Accounts receivable, net of allowance of $69 and $113, respectively 2,000 1,887
Inventory 100,867 68,330
Prepaid expenses and other assets 6,548 5,693
--------- -----------
Total current assets 219,280 275,330
--------- -----------
PROPERTY AND EQUIPMENT: 191,176 179,056
Less accumulated depreciation and amortization (101,937) (95,514)
--------- -----------
89,239 83,542
--------- -----------
LONG-TERM INVESTMENTS 39,690 44,032
OTHER ASSETS 2,639 2,639
--------- -----------
$ 350,848 $ 405,543
========= ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 32,397 $ 12,665
Accrued employee compensation 10,180 18,467
Accrued store operating expenses 4,148 4,236
Gift certificates redeemable 3,168 4,654
Income taxes payable 1,640 5,714
--------- -----------
Total current liabilities 51,533 45,736
DEFERRED COMPENSATION 2,323 1,799
DEFERRED RENT LIABILITY 25,668 25,080
--------- -----------
Total liabilities 79,524 72,615
--------- -----------
COMMITMENTS
STOCKHOLDERS' EQUITY:
Common stock, authorized 100,000,000 shares of $.01 par value; issued and
outstanding; 19,527,368 and 21,685,008 shares, respectively 195 217
Additional paid-in capital 40,592 26,857
Retained earnings 232,869 305,854
Unearned compensation - restricted stock (2,332) -
--------- -----------
Total stockholders' equity 271,324 332,928
--------- -----------
$ 350,848 $ 405,543
========= ===========
See notes to financial statements.
3
THE BUCKLE, INC.
STATEMENTS OF INCOME
(DOLLAR AMOUNTS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED
-------------------- ----------------------
JULY 30, JULY 31, JULY 30, JULY 31,
2005 2004 2005 2004
-------- -------- -------- --------
SALES, net of returns and allowances $104,130 $ 96,848 $209,677 $191,622
COST OF SALES (including buying,
distribution and occupancy costs) 67,883 67,054 136,181 131,166
-------- -------- -------- --------
Gross profit 36,247 29,794 73,496 60,456
-------- -------- -------- --------
OPERATING EXPENSES:
Selling 21,721 18,399 42,614 36,733
General and administrative 3,850 3,853 7,978 7,750
-------- -------- -------- --------
25,571 22,252 50,592 44,483
-------- -------- -------- --------
Income from operations 10,676 7,542 22,904 15,973
OTHER INCOME, Net 1,256 825 2,737 1,743
-------- -------- -------- --------
Income before income taxes 11,932 8,367 25,641 17,716
PROVISION FOR INCOME TAXES 4,379 3,050 9,467 6,511
-------- -------- -------- --------
NET INCOME $ 7,553 $ 5,317 $ 16,174 $ 11,205
======== ======== ======== ========
Per share amounts:
Basic income per share $ 0.39 $ 0.25 $ 0.81 $ 0.52
======== ======== ======== ========
Diluted income per share $ 0.38 $ 0.24 $ 0.78 $ 0.50
======== ======== ======== ========
Basic weighted average shares 19,145 21,406 19,905 21,388
Diluted weighted average shares 20,100 22,225 20,804 22,200
See notes to financial statements.
4
THE BUCKLE, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY
(DOLLAR AMOUNTS IN THOUSANDS)
ADDITIONAL
COMMON PAID-IN RETAINED UNEARNED
STOCK CAPITAL EARNINGS COMPENSATION TOTAL
---------- ---------- ---------- ------------ ----------
FISCAL 2005
BALANCE, January 29, 2005 $ 217 $ 26,857 $ 305,854 $ - 332,928
Net income - - 16,174 - 16,174
Dividends paid on common stock,
($0.12 per share) - - (2,264) - (2,264)
($0.15 per share) (2,925) - (2,925)
Common stock (764,860 shares)
issued on exercise of stock options 7 10,985 - - 10,992
Issuance of restricted stock 1 2,750 - (2,751) -
Amortization of restricted stock grant - - - 419 419
Common stock (3,000,000 shares)
purchased and retired (30) - (83,970) - (84,000)
---------- ---------- ---------- ---------- ----------
BALANCE, July 30, 2005 $ 195 $ 40,592 $ 232,869 $ (2,332) $ 271,324
========== ========== ========== ========== ==========
FISCAL 2004
BALANCE, January 31, 2004 $ 215 $ 24,245 $ 272,125 $ (2,740) 293,845
Net income - - 11,205 - 11,205
Dividends paid on common stock,
($0.10 per share) - - (4,312) - (4,312)
Common stock (123,990 shares)
issued on exercise of stock options 1 1,967 - - 1,968
Amortization of restricted stock grant - - - 1,370 1,370
Forfeiture of restricted stock (757 shares) (16) (16)
Common stock (45,700 shares)
purchased and retired - (1,196) - - (1,196)
---------- ---------- ---------- ---------- ----------
BALANCE, July 31, 2004 $ 216 $ 25,000 $ 279,018 $ (1,370) $ 302,864
========== ========== ========== ========== ==========
See notes to financial statements.
5
THE BUCKLE, INC.
STATEMENTS OF CASH FLOWS
(DOLLAR AMOUNTS IN THOUSANDS)
TWENTY-SIX WEEKS ENDED
------------------------
JULY 30, JULY 31,
2005 2004
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 16,174 $ 11,205
Adjustments to reconcile net income to net cash flows
from operating activities:
Depreciation 8,115 7,828
Amortization of unearned compensation - restricted stock 419 1,370
Deferred taxes - (38)
(Gain) loss on disposal of assets (117) 296
Changes in operating assets and liabilities:
Accounts receivable (113) 2,118
Inventory (32,537) (39,841)
Prepaid expenses (855) 4,219
Accounts payable 19,732 17,714
Accrued employee compensation (8,287) (5,152)
Accrued store operating expenses (88) 1,005
Gift certificates redeemable (1,486) (1,096)
Long-term liabilities and deferred compensation 1,112 324
Income taxes payable (4,074) 313
---------- ----------
Net cash flows from operating activities (2,005) 265
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (13,877) (9,166)
Proceeds from sale of property and equipment 182 -
Change in other assets - 137
Purchase of investments (9,586) (8,206)
Proceeds from sales and maturities of investments 11,945 10,717
---------- ----------
Net cash flows from investing activities (11,336) (6,518)
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from the exercise of stock options 10,992 1,951
Purchases of common stock (84,000) (1,195)
Payment of dividends (5,189) (4,314)
---------- ----------
Net cash flows from financing activities (78,197) (3,558)
---------- ----------
NET DECREASE IN CASH AND CASH EQUIVALENTS (91,538) (9,811)
CASH AND CASH EQUIVALENTS, Beginning of period 173,897 119,976
---------- ----------
CASH AND CASH EQUIVALENTS, End of period $ 82,359 $ 110,165
========== ==========
See notes to financial statements.
6
THE BUCKLE, INC.
NOTES TO FINANCIAL STATEMENTS
THIRTEEN AND TWENTY-SIX WEEKS ENDED JULY 30, 2005 AND JULY 31, 2004
(Unaudited)
1. Management Representation - The accompanying unaudited financial statements
have been prepared in accordance with accounting principles generally
accepted in the United States of America for interim financial information.
Accordingly, they do not include all of the information and footnotes
required by accounting principles generally accepted in the United States
of America for complete financial statements. In the opinion of management,
all adjustments necessary for a fair presentation of the results of
operations for the interim periods have been included. All such adjustments
are of a normal recurring nature. Because of the seasonal nature of the
business, results for interim periods are not necessarily indicative of a
full year's operations. The accounting policies followed by the Company and
additional footnotes are reflected in the financial statements for the
fiscal year ended January 29, 2005, included in The Buckle, Inc.'s 2004
Form 10-K.
2. Stock-Based Compensation - The Company has several stock option plans which
allow for granting of stock options to employees and directors, as
described more fully in the notes included in the Company's 2004 Annual
Report. A total of 3,225,000 shares of common stock are authorized for
grants under such plans as of July 30, 2005; of these authorized shares,
321,032 shares were available for grant under the various plans, of which
195,350 were available to executive officers. The Company accounts for
those plans under the recognition and measurement principles of APB Opinion
No. 25, Accounting for Stock Issued to Employees, and related
interpretations. The stock-based compensation expense reflected in net
income for the thirteen and twenty-six week periods ended July 30, 2005
relates to the issuance of 77,500 shares of restricted stock on February
22, 2005. The stock-based compensation expense reflected in net income for
the thirteen and twenty-six week periods ended July 31, 2004 is the result
of the issuance of 169,840 shares of restricted stock on June 26, 2003.
There is no recorded expense from the issuance of stock options, as all
options granted under the various plans had an exercise price equal to the
market value of the common stock on the date of grant. The following table
illustrates the effect of the restricted stock expense on net income and
the impact on net income and earnings per share if the Company had applied
the fair value recognition provisions of FASB Statement No. 123, Accounting
for Stock-Based Compensation, to stock-based employee compensation.
7
THE BUCKLE, INC.
NOTES TO FINANCIAL STATEMENTS
THIRTEEN AND TWENTY-SIX WEEKS ENDED JULY 30, 2005 AND JULY 31, 2004
(Unaudited)
Thirteen Weeks Ended Twenty-six Weeks Ended
--------------------------- ----------------------------
July 30,2005 July 31, 2004 July 30,2005 July 31, 2004
------------ ------------- ------------ -------------
Net income, as reported $ 7,553 $ 5,317 $ 16,174 $ 11,205
Add: Stock-based employee compensation expense
included in reported net income, net of related
tax effects 262 171 366 856
Deduct: Total stock-based employee compensation
expense determined under fair value based method
for all awards, net of related tax effects (677) (872) (1,327) (2,258)
------------ ------------- ------------ -------------
Pro forma net income $ 7,138 $ 4,616 $ 15,213 $ 9,803
============ ============= ============ =============
Earnings per share:
Basic - as reported $ 0.39 $ 0.25 $ 0.81 $ 0.52
============ ============= ============ =============
Basic - pro forma $ 0.37 $ 0.22 $ 0.76 $ 0.46
============ ============= ============ =============
Diluted - as reported $ 0.38 $ 0.24 $ 0.78 $ 0.50
============ ============= ============ =============
Diluted - pro forma $ 0.36 $ 0.21 $ 0.73 $ 0.44
============ ============= ============ =============
8
THE BUCKLE, INC.
NOTES TO FINANCIAL STATEMENTS
THIRTEEN AND TWENTY-SIX WEEKS ENDED JULY 30, 2005 AND JULY 31, 2004
(Unaudited)
The weighted average fair value of options granted during the thirteen and
twenty six week periods ended July 30, 2005 and July 31, 2004, respectively,
under the SFAS No. 123 methodology was $16.40 and $14.93 per option,
respectively. The fair value of options granted under the Plans was estimated at
the date of grant using a Black-Scholes option pricing model with the following
assumptions:
2005 2004
Risk-free interest rate 4.00 % 4.00 %
Dividend yield 1.50 % 1.50 %
Expected volatility 65.0 % 65.0 %
Expected life (years) 7.0 years 7.0 years
A summary of the Company's stock-based compensation activity related to stock
options for the fiscal quarters ended July 30, 2005 and July 31, 2004 is as
follows:
2005 2004
----------------------------- -----------------------------
Weighted Weighted
Average Average
Exercise Exercise
Number Price Number Price
------------- ------------- ------------- -------------
Outstanding - beginning
of fiscal quarter 3,334,806 $ 19.47 3,853,847 $ 19.03
Granted 0 n/a 300 26.96
Expired/terminated (7,212) 26.04 (13,228) 25.48
Exercised (638,206) 13.61 (23,690) 17.86
------------- ------------- ------------- -------------
Outstanding - end of quarter 2,689,388 $ 20.84 3,817,229 $ 19.01
============= ============= ============= =============
There were 2,090,552 and 1,621,929 options exercisable at July 30, 2005 and July
31, 2004, respectively.
The following table summarizes information about stock options outstanding as of
July 30, 2005:
Options Outstanding Options Exercisable
- ----------------------------------------------------------------- ---------------------
Weighted
Average Weighted Weighted
Remaining Average Average
Range of Number Contractual Exercise Number Exercise
Exercise Prices Outstanding Life Price Exercisable Price
$ 6.250 $ 6.333 113,250 0.51 years $ 6.33 113,250 $ 6.33
8.670 9.292 77,863 1.52 9.23 77,863 9.23
11.750 17.010 493,600 6.16 16.47 489,100 16.46
17.188 23.950 1,231,121 4.50 20.91 1,215,705 20.95
25.750 34.083 773,554 6.41 26.80 194,634 28.11
----------- -------- ------------ ----------- --------
2,689,388 5.10 years $ 20.84 2,090,552 $ 19.34
=========== ======== ============ =========== ========
3. Description of the Business - The Company is a retailer of medium to better
priced casual apparel and footwear for fashion conscious young men and
women. The Company operates their business as one reportable industry
segment. The Company had 333 stores located in 38 states throughout the
central, northwestern and southern regions of the United States as of July
30, 2005, and 324 stores in 38 states as of July 31, 2004. During the
second quarter of fiscal 2005, the Company opened five new stores and
substantially renovated three stores. During the second quarter of fiscal
2004, the Company opened three new stores and substantially renovated two
stores.
9
THE BUCKLE, INC.
NOTES TO FINANCIAL STATEMENTS
THIRTEEN AND TWENTY-SIX WEEKS ENDED JULY 30, 2005 AND JULY 31, 2004
(Unaudited)
The following is information regarding the Company's major product lines,
stated as a percentage of the Company's net sales:
Thirteen Weeks Ended Twenty-six Weeks Ended
Merchandise Group July 30, 2005 July 31, 2004 July 30, 2005 July 31, 2004
------------- ------------- ------------- -------------
Denims 38.3% 35.5% 40.0% 35.7%
Tops (including sweaters) 31.1 33.9 30.6 32.4
Accessories 10.1 11.8 9.7 11.4
Footwear 9.1 7.6 8.9 8.4
Sportswear/Fashions 8.0 9.2 6.8 9.4
Casual bottoms 2.2 1.6 2.7 2.3
Outerwear 1.1 0.3 1.2 0.4
Other 0.1 0.1 0.1 0.0
----- ----- ----- -----
100.0% 100.0% 100.0% 100.0%
===== ===== ===== =====
4. Net Income Per Share - Basic earnings per share data are based on the
weighted average outstanding common shares during the period. Diluted
earnings per share data are based on the weighted average outstanding
common shares and the effect of all dilutive potential common shares,
including stock options. Options to purchase 81,540 shares of common stock
for the period ended July 31, 2004, are not included in the computation of
diluted earnings per share because the options would be considered
anti-dilutive.
Thirteen Weeks Ended Thirteen Weeks Ended
July 30, 2005 July 31, 2004
--------------------------------- ---------------------------------
Per Share Per Share
Income Shares Amount Income Shares Amount
--------- --------- --------- --------- --------- ---------
Basic EPS
Net income $ 7,553 19,145 $ 0.39 $ 5,317 21,406 $ 0.25
Effect of Dilutive
Securities
Stock options - 955 (0.01) - 819 (0.01)
--------- --------- --------- --------- --------- ---------
Diluted EPS $ 7,553 20,100 $ 0.38 $ 5,317 22,225 $ 0.24
========= ========= ========= ========= ========= =========
Twenty-six Weeks Ended Twenty-six Weeks Ended
July 30, 2005 July 31, 2004
--------------------------------- ---------------------------------
Per Share Per Share
Income Shares Amount Income Shares Amount
--------- --------- --------- --------- --------- ---------
Basic EPS
Net income $ 16,174 19,905 $ 0.81 $ 11,205 21,388 $ 0.52
Effect of Dilutive
Securities
Stock options - 899 (0.03) - 812 (0.02)
--------- --------- --------- --------- --------- ---------
Diluted EPS $ 16,174 20,804 $ 0.78 $ 11,205 22,200 $ 0.50
========= ========= ========= ========= ========= =========
10
THE BUCKLE, INC.
NOTES TO FINANCIAL STATEMENTS
THIRTEEN AND TWENTY-SIX WEEKS ENDED JULY 30, 2005 AND JULY 31, 2004
(Unaudited)
5. Related Party Transactions - On March 24, 2005, the Company entered into
an agreement with Daniel J. Hirschfeld, founder and Chairman, to purchase
a total of 3,000,000 shares of the Company's outstanding stock from Mr.
Hirschfeld. The shares represented approximately 13.8% of the Company's
total shares of Common Stock then outstanding. The shares were purchased
for $28.00 per share, or a total purchase price of $84 million. The
Company retired the purchased shares, reducing the total shares
outstanding and reducing Mr. Hirschfeld's ownership percentage to
approximately 53%.
The stock repurchase transaction was negotiated by a Special Committee of
The Buckle, Inc.'s Board of Directors. The Special Committee was comprised
of all of the Company's independent Directors, and therefore the
transaction was approved by the independent Directors on the Company's
Board. In connection with this transaction, the Special Committee received
a written fairness opinion from Houlihan Lokey Howard & Zukin Financial
Advisors, Inc., an international investment bank.
11
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the Financial
Statements and notes thereto of the Company included in this Form 10-Q. The
following is management's discussion and analysis of certain significant factors
which have affected the Company's financial condition and results of operations
during the periods included in the accompanying financial statements.
EXECUTIVE OVERVIEW
Management considers the following items to be key performance indicators in
evaluating Company performance.
Comparable Store Sales - Stores are deemed to be comparable stores if they were
open in the prior year on the first day of the fiscal period being presented.
Stores which have been remodeled, expanded and/or relocated, but would otherwise
be included as comparable stores, are not excluded from the comparable store
sales calculation. Management considers comparable store sales to be an
important indicator of current company performance, helping provide positive
operating leverage for certain fixed costs when results are positive. Negative
comparable store sales results could reduce net sales and have a negative impact
on operating leverage, thus reducing net earnings. Beginning with the four-week
period ended May 1, 2004, the Company changed its method of reporting comparable
store sales to exclude internet sales. Comparable store sales reported for all
periods subsequent to that date reflect the impact of this change and for all
prior periods the impact was immaterial.
Net Merchandise Margins - Management evaluates the components of merchandise
margin including initial markup and the amount of markdowns during a period. Any
inability to obtain acceptable levels of initial markups or any significant
increase in the Company's use of markdowns, could have an adverse effect on the
Company's gross margin and results of operations.
Operating Margin - Operating margin is a good indicator for management of the
Company's success. Operating margin can be positively or negatively affected by
comparable store sales, merchandise margins, occupancy costs and the Company's
ability to control operating costs.
Cash Flow and Liquidity (working capital) - Management reviews current cash and
short-term investments along with cash flow from operating, investing and
financing activities to determine the Company's short-term cash needs for
operations and expansion. The Company believes that existing cash and cash flow
from operations will be sufficient to fund current and long-term anticipated
capital expenditures and working capital requirements for the next several
years.
12
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
The table below sets forth the percentage relationships of sales and various
expense categories in the Statements of Income for each of the thirteen and
twenty-six week periods ended July 30, 2005, and July 31, 2004:
PERCENTAGE OF NET SALES PERCENTAGE OF NET SALES
THIRTEEN WEEKS ENDED PERCENTAGE TWENTY-SIX WEEKS ENDED PERCENTAGE
----------------------------- INCREASE/ ---------------------------- INCREASE/
JULY 30, 2005 JULY 31, 2004 (DECREASE) JULY 30, 2005 JULY 31, 2004 (DECREASE)
------------- ------------- ---------- ------------- ------------- ----------
Net sales 100.0% 100.0% 7.5 100.0% 100.0% 9.4%
Cost of sales (including buying,
distribution and occupancy costs) 65.2% 69.2% 1.2 65.0% 68.5% 3.8%
----- ----- ---- ----- ----- ----
Gross profit 34.8% 30.8% 21.7 35.0% 31.5% 21.6%
Selling expenses 20.8% 19.0% 18.1 20.3% 19.2% 16.0%
General and administrative expenses 3.7% 4.0% -0.1% 3.8% 4.0% 2.9%
----- ----- ---- ----- ----- ----
Income from operations 10.3% 7.8% 41.5 10.9% 8.3% 43.4%
Other income, net 1.2% 0.9% 52.2 1.3% 0.9% 57.0%
----- ----- ---- ----- ----- ----
Income before income taxes 11.5% 8.7% 42.6 12.2% 9.2% 44.7%
Provision for income taxes 4.2% 3.2% 43.6 4.5% 3.4% 45.4%
----- ----- ---- ----- ----- ----
Net income 7.3% 5.5% 42.0 7.7% 5.8% 44.3%
----- ----- ---- ----- ----- ----
Net sales increased from $96.8 million in the second quarter of fiscal 2004 to
$104.1 million in the second quarter of fiscal 2005, a 7.5% increase. Comparable
store sales increased from the second quarter of fiscal 2004 to the second
quarter of fiscal 2005 by $2.7 million or 2.9%. The comparable store sales
increase resulted primarily from a 5.3% increase in the average retail price per
piece of merchandise sold during the second quarter of fiscal 2005 compared with
the second quarter of fiscal 2004 and a 1.0% increase in the average units per
transaction during the period, partially offset by a decrease in the number of
transactions. Sales growth for the thirteen week period was also attributable to
the inclusion of a full three months of operating results for three stores
opened after the first quarter of 2004 and seven new stores opened during the
first two quarters of fiscal 2005.
Net sales increased from $191.6 million in the first six months of fiscal 2004
to $209.7 million for the first six months of fiscal 2005, a 9.4% increase.
Comparable store sales for the twenty-six week period ended July 30, 2005
compared to the twenty-six week period ended July 31, 2004 increased $8.6
million or 4.6%. The comparable store sales increase resulted primarily from a
5.2% increase in the average retail price per piece of merchandise sold during
the twenty-six week period compared with the same period in the prior year,
partially offset by a decrease in the number of transactions during the period.
Sales growth for the twenty-six week period was also attributable to the
inclusion of a full six months of operating results for 13 stores opened during
fiscal 2004 and 7 new stores opened during the first twenty-six weeks of fiscal
2005. Average sales per square foot increased 5.6% from $120 for the six months
ended July 31, 2004, to $127 for the six months ended July 30, 2005.
The Company's increase in average price per piece of merchandise sold (as stated
above) during the second quarter was primarily attributable to a shift in the
mix of merchandise sold during the period, a 4.2% increase in average denim
price points, a 6.6% increase in average knit shirt price points, a 4.5%
increase in average woven shirt price points and a 14.8% increase in average
sweater price points. The effect of these increases was partially offset by a
7.0% decrease in average accessories price points, a 6.0% percent decrease in
average active sportswear price points and a 4.8% decrease in average footwear
price points. For the first six months of fiscal 2005, the increase was
primarily attributable to a shift in the mix of merchandise sold during the
period, a 4.1% increase in average denim price points, a 3.9% increase in
average knit shirt price points and a 12.8% increase in average sweater price
points; partially offset by a 4.1% decrease in average accessories price points,
a 5.4% decrease in average active sportswear price points and a 1.7% decrease in
average footwear price points. These changes for both the thirteen and
twenty-six week periods ended July 30, 2005, are a reflection of merchandise
shifts in terms of brands, product styles, fabrics, details and finishes.
13
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Gross profit after buying, occupancy and distribution expenses increased $6.5
million in the second quarter of fiscal 2005 to $36.2 million, a 21.7% increase.
As a percentage of net sales, gross profit was 34.8% in the second quarter of
fiscal 2005 versus 30.8% in the second quarter of fiscal 2004. The increase in
gross profit, as a percentage of net sales, resulted primarily from a 3.7%
improvement in actual merchandise margins achieved through timely sell-through
on new products, reduced markdowns and an increase in the sale of private label
merchandise, which achieves higher margins. The Company also had reductions in
second quarter expense, as a percentage of net sales, related to leveraged
occupancy costs (0.5%) and reduced buying costs (0.1%). These reductions were,
however, partially offset by an increase in the incentive bonus accrual based on
growth in comparable store sales, gross margin and net income (0.2%) and
increases in certain distribution expenses (0.1%).
Gross profit increased $13.0 million for the first twenty-six weeks of fiscal
2005 to $73.5 million, a 21.6% increase. As a percentage of net sales, gross
profit for the first six months of fiscal 2005 increased to 35.0% versus 31.5%
for the same period in fiscal 2004. The increase in gross profit, as a
percentage of net sales, resulted primarily from a 2.5% improvement in actual
merchandise margins achieved through timely sell-through on new products,
reduced markdowns and an increase in the sale of private label merchandise,
which achieves higher margins. The Company also had reductions in second quarter
expense, as a percentage of net sales, related to leveraged occupancy costs
(1.0%) and reduced buying costs (0.1%). These reductions were, however,
partially offset by an increase in the incentive bonus accrual based on growth
in comparable store sales, gross margin and net income (0.1%).
14
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Selling expense increased from $18.4 million in the second quarter of fiscal
2004 to $21.7 million for the second quarter of fiscal 2005, an 18.1% increase.
Selling expenses, as a percentage of net sales, increased from 19.0% for the
second quarter of fiscal 2004 to 20.8% for the second quarter of fiscal 2005.
The increase in selling expense, as a percentage of net sales, resulted
primarily from increases in the incentive bonus accrual (1.0%), payroll taxes
(0.3%), internet expenses (0.2%), store salaries (0.2%), insurance costs (0.2%)
and bankcard fees (0.2%). These increases were partially offset by decreases, as
a percentage of net sales, in advertising and certain other selling expenses.
Year-to-date, selling expense rose from $36.7 million in the first six months of
fiscal 2004 to $42.6 million for the first six months of fiscal 2005, a 16.0%
increase. As a percentage of net sales, selling expense for the period increased
from 19.2% in fiscal 2004 to 20.3% in fiscal 2005. The increase in selling
expense, as a percentage of net sales, resulted primarily from increases in the
incentive bonus accrual (0.6%), payroll taxes (0.2%), internet expenses (0.2%),
store salaries (0.1%), insurance costs (0.1%) and bankcard fees (0.1%). These
increases were partially offset by decreases, as a percentage of net sales, in
advertising and certain other selling expenses.
General and administrative expenses remained the same at $3.9 million for the
second quarter of both fiscal 2004 and fiscal 2005. As a percentage of net
sales, general and administrative expenses decreased from 4.0% for the second
quarter of fiscal 2004 to 3.7% for the second quarter of fiscal 2005. The
reduction in general and administrative expenses, as a percentage of net sales,
was attributable to a reduction in the amount of restricted stock compensation
recognized during the quarter (0.3%) and reduced expense related to gains/losses
on the disposal of assets (0.4%). These reductions were partially offset by
increases in the incentive bonus accrual (0.2%), home office payroll expense
(0.1%), compensation expense related to unrealized gains in the Company's
non-qualified deferred compensation plan (0.1%) and certain other general and
administrative expenses.
Year-to-date, general and administrative expense rose from $7.8 million for the
first six months of fiscal 2004 to $8.0 million for the first six months of
fiscal 2005, a 2.9% increase. As a percentage of net sales, general and
administrative expense for the period decreased from 4.0% in fiscal 2004 to 3.8%
in fiscal 2005. The reduction in general and administrative expenses, as a
percentage of net sales, was attributable to a reduction in the amount of
restricted stock compensation recognized during the six month period (0.5%) and
reduced expense related to gains/losses on the disposal of assets (0.3%). These
reductions were partially offset by increases in the incentive bonus accrual
(0.3%), professional fees related to the Company's stock buyback from its
founder and Sarbanes Oxley compliance (0.3%) and home office payroll expense
(0.1%).
As a result of the above changes, the Company's income from operations increased
$3.2 million to $10.7 million for the second quarter of fiscal 2005 compared to
$7.5 million for the second quarter of fiscal 2004, a 41.5% increase. Income
from operations was 10.3% of net sales for the second quarter of fiscal 2005
compared to 7.8% of net sales for the second quarter of fiscal 2004. Income from
operations, for the twenty-six week period ended July 30, 2005, was $22.9
million, a $6.9 million or 43.4% increase from the same twenty-six week period
in fiscal 2004. Income from operations was 10.9% of net sales for the first six
months of fiscal 2005 compared to 8.3% for the first six months of fiscal 2004.
For the quarter ended July 30, 2005, other income increased $0.4 million. For
the six months ended July 30, 2005, other income increased $1.0 million. The
increase in other income for both the three and six month periods in fiscal 2005
compared to the same periods in the prior year was primarily due to increased
income earned on the Company's cash and investments resulting from higher
interest rates.
Income tax expense, as a percentage of pre-tax income, was 36.7% in the second
quarter of fiscal 2005 compared to 36.5% for the second quarter of fiscal 2004.
For the first half of fiscal 2005, income tax expense was 36.9% of pre-tax
income compared to 36.8% for the first half of fiscal 2004.
15
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
As of July 30, 2005, the Company had working capital of $167.7 million,
including $82.4 million of cash and cash equivalents and short-term investments
of $27.5 million. The Company's primary ongoing cash requirements are for
inventory, payroll, new store expansion and remodeling. Historically, the
Company's primary source of working capital has been cash flow from operations.
However, the first half of each fiscal year is typically a period of decreasing
cash flows created by various operating, investing and financing activities.
During the first half of fiscal 2005 and 2004, the Company's cash flow (used)
provided by operating activities was $(2.0) and $0.3 million, respectively.
The uses of cash for both twenty-six week periods include payment of annual
bonuses accrued at fiscal year end, changes in inventory and accounts payable
for build up of inventory levels, and construction costs for new and remodeled
stores. The differences in cash flow for the first six months of fiscal 2005
compared to the first six months of fiscal 2004 were primarily due to growth in
net income, a reduced build-up of inventory and additional purchases of property
and equipment. During the first quarter of fiscal 2005, the Company completed a
repurchase of 3 million shares of common stock, resulting in a cash payout of
$84 million.
The Company has available an unsecured line of credit of $17.5 million with
Wells Fargo Bank, N.A. for operating needs and letters of credit. The note
provides that outstanding letters of credit cannot exceed $10 million. Borrowing
under the line of credit note provides for interest to be paid at a rate equal
to the prime rate established by the Bank. The Company has, from time to time,
borrowed against this line during periods of peak inventory build-up. There were
no bank borrowings during the first half of fiscal 2005 or fiscal 2004.
During the first half of fiscal 2005 and 2004 the Company invested $8.9 million
and $8.8 million, respectively, in new store construction, store renovation and
upgrading store technology. The Company also spent approximately $5.0 million in
the first half of fiscal 2005 in capital expenditures related to the expansion
of its corporate headquarters and distribution center compared to $0.4 million
spent in the first half of fiscal 2004.
During the remainder of fiscal 2005, the Company anticipates completing
approximately eight additional store construction projects, including
approximately five new stores and approximately three stores to be remodeled
and/or relocated. As of July 30, 2005, eight additional lease contracts have
been signed.
Management now estimates that total capital expenditures during fiscal 2005 will
be approximately $23.4 million. The Company believes that existing cash and cash
flow from operations will be sufficient to fund current and long-term
anticipated capital expenditures and working capital requirements for the next
several years. The Company has a consistent record of generating positive cash
flow each year and, as of July 30, 2005, had total cash and investments of
$149.6 million. The Company does not currently have plans for a merger,
acquisition or accelerated store expansion. The Company's plans for new store
expansion and remodels/relocations during the next three years are reasonably
consistent with its past three fiscal years' average. Based upon past results
and current plans, management does not anticipate any material changes in the
Company's need for cash in the upcoming year. However, future conditions may
reduce the availability of funds based upon factors such as a decrease in demand
for the Company's product, change in product mix, competitive factors and
general economic conditions as well as other risks and uncertainties which would
reduce the Company's sales, net profitability and cash flows. Also, the
Company's acceleration in store openings and/or remodels, or the Company
entering into a merger, acquisition or other financial related transaction,
could reduce the amount of cash available for further capital expenditures and
working capital requirements.
16
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
Management's Discussion and Analysis of Financial Condition and Results of
Operations are based upon The Buckle, Inc.'s financial statements, which have
been prepared in accordance with accounting principles generally accepted in the
United States of America. The preparation of these financial statements requires
that management make estimates and judgments that affect the reported amounts of
assets and liabilities, and disclosure of contingent assets and liabilities, at
the financial statement date, and the reported amounts of sales and expenses
during the reporting period. The Company regularly evaluates its estimates,
including those related to merchandise returns, inventory, and income taxes.
Management bases its estimates on past experience and on various other factors
that are thought to be reasonable under the circumstances, the results of which
form the basis for making judgments about the carrying values of assets and
liabilities that are not readily apparent from other sources. Actual results may
differ from these estimates under different assumptions or conditions. The
Company's certain critical accounting policies are listed below.
1. Revenue Recognition. Sales are recorded upon the purchase of merchandise
by customers. The Company accounts for layaway sales in accordance with
SAB No. 101, recognizing revenue from sales made under its layaway program
upon delivery of the merchandise to the customer. Revenue is not recorded
when gift cards and gift certificates are sold, but rather when a card is
redeemed for merchandise. A current liability is recorded at the time of
card purchases.
The Company establishes a current liability for estimated merchandise
returns based upon historical average sales return percentage, applying
the percentage using the assumption that merchandise returns will occur
within nine days following the sale. Customer returns could potentially
exceed historical average and returns may occur after the time period
reserved for, thus reducing future net sales results and potentially
reducing future net earnings. The accrued liability for reserve for sales
returns was $307,500 at July 30, 2005 and $267,500 at January 29, 2005.
2. Inventory. Inventory is valued at the lower of cost or market. Cost is
determined using the average cost method that approximates the first-in,
first-out (FIFO) method. Management makes adjustments to inventory and
cost of goods sold based upon estimates to reserve for merchandise
obsolescence and markdowns that could affect market value, based on
assumptions using calculations applied to current inventory levels by
department within each of four different markdown levels. Management also
reviews the levels of inventory in each markdown group versus the
estimated future demand for such product and the current market
conditions. Such judgments could vary significantly from actual results,
either favorably or unfavorably, due to fluctuations in future economic
conditions, industry trends, consumer demand and the competitive retail
environment. Such changes in market conditions could negatively impact the
sale of markdown inventory causing further markdowns, or inventory
obsolescence, resulting in increased cost of goods sold from write-offs,
and reducing the Company's net earnings. The liability for markdown
reserves and/or obsolescence was $4.8 million and $5.0 million as of July
30, 2005 and January 29, 2005, respectively. We are not aware of any
events, conditions or changes in demand or price that would indicate to us
that our inventory valuation may be materially inaccurate at this time.
3. Income Taxes. Current income tax expense is the amount of income taxes
expected to be payable for the current fiscal year. The Company records a
deferred tax asset and liability for expected future tax consequences
resulting from temporary differences between financial reporting and tax
bases of assets and liabilities. The Company considers future taxable
income and ongoing tax planning in assessing the value of its deferred tax
assets. If the Company determines that it is more than likely that these
assets will not be realized, the Company would reduce the value of these
assets to their expected realizable value, thereby decreasing net income.
Estimating the value of these assets is based upon the Company's judgment.
If the Company subsequently determined that the deferred tax assets, which
had been written down, would be realized in the future, such value would
be increased. Adjustment would be made to increase net income in the
period such determination was made.
17
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
4. Operating Leases. The Company leases retail stores under operating leases.
Most lease agreements contain tenant improvement allowances, rent
holidays, rent escalation clauses and/or contingent rent provisions. For
purposes of recognizing lease incentives and minimum rental expenses on a
straight-line basis over the terms of the leases, the Company uses the
date of initial possession to begin amortization, which is generally when
the Company enters the space and begins to make improvements in
preparation of intended use. For tenant improvement allowances and rent
holidays, the Company records a deferred rent liability on the balance
sheets and amortizes the deferred rent over the terms of the leases as
reductions to rent expense on the statements of earnings.
For scheduled rent escalation clauses during the lease terms or for rental
payments commencing at a date other than the date of initial occupancy,
the Company records minimum rental expenses on a straight-line basis over
the terms of the leases on the statements of income. Certain leases
provide for contingent rents, which are determined as a percentage of
gross sales in excess of specified levels. The Company records a
contingent rent liability on the balance sheets and the corresponding rent
expense when specified levels have been achieved. If the Company
subsequently determined the lease term to vary from that used in
calculations of straight-line rent expense, there could be additional
expense to be recorded, thus reducing the Company's earnings for the
period of correction.
CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS
As referenced in the tables below, the Company has contractual obligations and
commercial commitments that may affect the financial condition of the Company.
Based on management's review of the terms and conditions of its contractual
obligations and commercial commitments, there is no known trend, demand,
commitment, event or uncertainty that is reasonably likely to occur which would
have a material effect on the Company's financial condition or results of
operations. In addition, the commercial obligations and commitments made by the
Company are customary transactions which are similar to those of other
comparable retail companies.
The following tables identify the material obligations and commitments as of
July 30, 2005:
Payments Due by Period
------------------------------------------------------------
Contractual obligations
(dollar amounts in Less than 1
thousands) Total year 1-3 years 4-5 years After 5 years
-------- ----------- --------- --------- -------------
Long term debt and purchase
obligations $ - $ - $ - $ - $ -
Deferred compensation $ 2,322 $ - $ - $ - $ 2,322
Operating leases $207,863 $32,909 $60,376 $51,940 $62,638
Total contractual obligations $210,185 $32,909 $60,376 $51,940 $64,960
18
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Amount of Commitment Expiration Per Period
-----------------------------------------------------
Other Commercial
Commitments (dollar Total Amounts Less than 1
amounts in thousands) Committed year 1-3 years 4-5 years After 5 years
- ---------------------------- ------------- ----------- --------- --------- -------------
Lines of credit $ 17,500 $ 17,500 $ - $ - $ -
Total commercial commitments $ 17,500 $ 17,500 $ - $ - $ -
The Company did not have any contingent liability for landlord allowances as of
July 30, 2005. The Company has available an unsecured line of credit of $17.5
million of which $10 million is available for letters of credit. Certain
merchandise purchase orders require that the Company open letters of credit.
When the Company takes possession of the merchandise, it releases payment on the
letters of credit. Amounts of outstanding letters of credit, reported in the
notes included in the Company's 2004 Annual Report, reflect the open letters of
credit on merchandise ordered, but not yet received or funded. The Company
believes it has sufficient credit available to open letters of credit for
merchandise purchases.
SEASONALITY AND INFLATION
The Company's business is seasonal, with the Christmas season (from
approximately November 15 to December 30) and the back-to-school season (from
approximately July 15 to September 1) historically contributing the greatest
volume of net sales. For fiscal years 2002, 2003, and 2004, the Christmas and
back-to-school seasons accounted for approximately 40% of the Company's fiscal
year net sales. Although the operations of the Company are influenced by general
economic conditions, the Company does not believe that inflation has had a
material effect on the results of operations during the thirteen-week periods
ended July 30, 2005, and July 31, 2004.
FORWARD LOOKING STATEMENTS
Information in this report, other than historical information, may be considered
to be forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 (the "1995 Act"). Such statements are made in good
faith by the Company pursuant to the safe-harbor provisions of the 1995 Act. In
connection with these safe-harbor provisions, this management's discussion and
analysis contains certain forward-looking statements, which reflect management's
current views and estimates of future economic conditions, company performance
and financial results. The statements are based on many assumptions and factors
that could cause future results to differ materially. Such factors include, but
are not limited to, changes in product mix, changes in fashion trends,
competitive factors and general economic conditions, economic conditions in the
retail apparel industry, as well as other risks and uncertainties inherent in
the Company's business and the retail industry in general. Any changes in these
factors could result in significantly different results for the Company. The
Company further cautions that the forward-looking information contained herein
is not exhaustive or exclusive. The Company does not undertake to update any
forward-looking statements, which may be made from time to time by or on behalf
of the Company.
19
ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company has evaluated the disclosure requirements of Item 305 of S-K
"Quantitative and Qualitative Disclosures about Market Risk," and has concluded
that the Company has no market risk sensitive instruments for which these
additional disclosures are required.
ITEM 4 - CONTROLS AND PROCEDURES
The Company maintains a system of disclosure controls and procedures that are
designed to provide reasonable assurance that material information, which is
required to be timely disclosed, is accumulated and communicated to management
in a timely manner. An evaluation of the effectiveness of the design and
operation of our disclosure controls and procedures (as defined in Rules
13a-15(e) of the Securities Exchange Act of 1934 (the "Exchange Act")) was
performed as of the end of the period covered by this report. This evaluation
was performed under the supervision and with the participation of the Company's
Chief Executive Officer and Chief Financial Officer. Based upon that evaluation,
the Chief Executive Officer and Chief Financial Officer concluded that the
Company's disclosure controls and procedures are effective to provide reasonable
assurance that information required to be disclosed by the Company in the
Company's reports that it files or submits under the Exchange Act is accumulated
and communicated to the management, including its Chief Executive Officer and
Chief Financial Officer, as appropriate, to allow timely decisions regarding
required disclosure and are effective to provide reasonable assurance that such
information is recorded, processed, summarized and reported within the time
periods specified by the SEC's rules and forms.
In connection with the preparation of the Company's Annual Report on Form 10-K
as of January 29, 2005, the Company's management assessed the effectiveness of
the Company's internal control over financial reporting. In performing this
assessment, management reviewed the Company's lease accounting policies in light
of a February 7, 2005 letter from the Office of the Chief Accountant of the
Securities and Exchange Commission to the American Institute of Certified Public
Accountants expressing views regarding lease-related accounting issues and their
application under GAAP. The Company determined that its historical accounting
for rent holidays, tenant allowances and certain other lease accounting
policies, when reviewed against the guidance as set forth in the SEC letter,
were not in accordance with GAAP. As a result, the Company changed its
accounting policies and procedures to conform to GAAP as set forth in the SEC
letter. Management concluded that it had a material weakness in the
effectiveness of internal controls over the selection and monitoring of the
policies used in accounting for leases and tenant allowances as of January 29,
2005. During the fiscal quarter ended April 30, 2005 and prior to filing the
Company's Annual Report on Form 10-K for fiscal 2004, the Company corrected its
accounting for leases and tenant allowances and restated its financial
statements for each of the fiscal years ended January 31, 2004, February 1, 2003
and February 2, 2002, thus remediating that material weakness.
Other than the changes to the Company's lease accounting policies and
procedures, there were no significant changes in the Company's internal control
over financial reporting that occurred during the fiscal quarter ended July 30,
2005, that has materially affected, or is reasonably likely to materially
affect, the Company's internal control over financial reporting.
20
THE BUCKLE, INC.
PART II -- OTHER INFORMATION
Item 1. Legal Proceedings: None
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds:
The following table sets forth information concerning purchases made by
the Company of its common stock for the periods indicated:
Approximate
Total Number of Dollar Value of
Total Shares Purchased Shares that May
Number Average as Part of Yet Be Purchased
of Shares Price Paid Publicly Under Publicly
Purchased Per Share Announced Plans Announced Plans
January 30, to Feb. 26, 2005 -0- $ 485,550
Feb. 27, to April 2, 2005 3,000,000 28.00 3,000,000 485,550
April 3, to April 30, 2005 -0- -0- 485,550
--------- ------ ---------
3,000,000 $28.00 3,000,000
========= ====== =========
The shares purchased during the quarter ended April 30, 2005 were pursuant to an
agreement entered into with founder and chairman, Daniel J. Hirschfeld, on March
24, 2005 and announced on March 25, 2005 to purchase 3,000,000 shares.
Subsequent to April 30, 2005, the Company has not repurchased any shares of its
common stock. The shares yet to be purchased are remaining from a 500,000 share
repurchase plan, announced by the Company on December 27, 2000.
Item 3. Defaults Upon Senior Securities: None
Item 4. Submission of Matters to a Vote of Security Holders:
(a) June 2, 2005, Annual Meeting
(b) Board of Directors:
Daniel J. Hirschfeld Robert E. Campbell
Dennis H. Nelson William D. Orr
Karen B. Rhoads Ralph M. Tysdal
James E. Shada Bruce L. Hoberman
Bill L. Fairfield David A. Roehr
NUMBER OF SHARES*
-----------------------------------
For Against Abstain Del N-Vote
---------- ------- --------- ----------
(c) 1. Election of Board of Directors:
Daniel J. Hirschfeld 16,159,640 0 2,141,349
Dennis H. Nelson 16,392,290 0 1,908,699
Karen B. Rhoads 16,321,687 0 1,979,302
James E. Shada 16,159,240 0 2,141,749
Bill L. Fairfield 17,690,947 0 610,042
Robert E. Campbell 17,689,297 0 611,692
William D. Orr 17,687,597 0 613,392
Ralph M. Tysdal 17,687,897 0 613,092
Bruce L. Hoberman 17,690,497 0 610,492
David A. Roehr 17,689,747 0 611,242
21
NUMBER OF SHARES*
-----------------------------------
For Against Abstain Del N-Vote
---------- -------- --------- ----------
2. Appoint Deloitte & Touche LLP
as independent auditors. 17,760,363 538,860 1,766
3. Approve Company's 2005
Management Incentive Program 16,196,207 778,869 8,566 1,317,347
4. Approve Company's 2005
Restricted Stock Plan 15,373,781 1,599,055 10,806 1,317,347
5. Approve Awards Pursuant to
Company's 2005 Restricted
Stock Plan 16,341,205 631,671 10,766 1,317,347
* includes only shares represented in person or by proxy at the annual meeting
(d) None
Item 5. Other Information: None
Item 6. Exhibits:
(a) Exhibits 31.1 and 31.2 certifications, as well as Exhibits 32.1 and
32.2 Certifications Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
22
THE BUCKLE, INC.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
THE BUCKLE, INC.
Dated: September 7, 2005 /s/ DENNIS H. NELSON .
------------------------------------------
DENNIS H. NELSON, President and CEO
Dated: September 7, 2005 /s/ KAREN B. RHOADS .
------------------------------------------
KAREN B. RHOADS, Vice President
of Finance and CFO
23