For Further Information: EXHIBIT 99.1
Big Dog Holdings, Inc.
121 Gray Avenue
Santa Barbara, California 93101
www.bigdogs.com
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www.walkingco.com
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CONTACT:
Laura Russell
Investor Information
(805) 963-8727, ext. 1360
laurar@bigdogs.com
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For Immediate Release:
November 2, 2005
Big Dog Holdings, Inc. Announces Third Quarter 2005 Financial Results
Santa Barbara, California - November 2, 2005... Big Dog Holdings, Inc.
(NASDAQ: BDOG; www.bigdogs.com; www.thewalkingcompany.com), a devloper and
retailer of branded, lifestyle consumer products, today reported the
financial results for the third quarter ended September 30, 2005.
For the quarter ended September 30, 2005, consolidated net sales were
$44,909,000 as compared with $42,695,000 in the third quarter 2004. Our
consolidated net sales increased 5.2%, primarily due to comparative stores sales
increase of 4.1% (comparative store sales decline of 1.6% for Big Dogs and
comparative store sales increase of 13.1% for TWC), and the net increase in the
number of stores opened for the quarter. The Company had a total of 263 stores
opened (176 Big Dog stores and 87 TWC stores) at the end of the period, as
compared 261 stores last year (188 Big Dogs stores and 73 TWC stores as of
September 30, 2004.) Consolidated gross profit increased to $25,286,000 in the
third quarter 2005 as compared with $23,433,000 in the third quarter 2004. The
overall increase in consolidated gross profit is the result of increased sales
for TWC, as well as increased margin contributions from both Big Dogs and TWC.
Big Dogs' gross margin for the period increased to 60.4%, as compared to last
year's margin of 58.0%, and the gross margin for the TWC chain increased to
50.9% compared to 49.7% last year.
Consolidated operating expenses in the third quarter 2005 were $22,262,000, or
49.6% of consolidated net sales, compared to $21,174,000 or 49.6% in 2004.
Consolidated net income increased to $1,770,000 in 2005 as compared to
$1,284,000 for the third quarter 2004. Fully diluted net income per share
increased to $.18 per share as compared with $.13 per share last year.
Included in the third quarter, effective August 31, 2005, is the purchase by The
Walking Company of Footworks, a seven-store comfort shoe chain that primarily
operates in the Las Vegas market. The Company purchased its assets for
approximately $10.1 million.
Andrew Feshbach, Chief Executive Officer, stated, "Given the unusual number of
hurricanes this quarter, we are very pleased with the results of our 3rd quarter
business for both chains. Currently, we are focused on our 4th quarter business
and integrating our Footworks acquisition into the Walking Company. Sales in the
4th quarter are trending as experienced earlier this year and we look forward to
a good holiday selling season."
Big Dog Holdings, Inc. consists of Big Dogs and The Walking Company. Big Dogs
develops, markets and retails a branded, lifestyle collection of unique,
high-quality, popular-priced consumer products, including activewear, casual
sportswear, accessories and gifts. The BIG DOGS(R) brand image is one of
quality, value and fun. The BIG DOGS(R) brand is designed to appeal to people of
all ages and demographics, particularly baby boomers and their kids, big and
tall customers, and pet owners. In addition to its 176 retail stores, Big Dogs
markets its products through its catalog, internet and corporate sales accounts.
The Walking Company is a leading independent specialty retailer of high quality,
technically designed comfort shoes and accessories that features premium brands
such as ECCO, Mephisto, Dansko, Birkenstock and Merrell among many others. These
products have particular appeal to one of the largest and most rapidly growing
demographics in the nation. The Walking Company operates 88 stores in premium
malls across the nation.
Safe Harbor Statement Under the Private Securities Litigation Reform Act of
1995- With the exception of historical information, the matters discussed in
this press release are forward looking statements that involve a number of risks
and uncertainties. The actual future sales and other results of the Company
could differ significantly from those statements. Further information on the
Company's risk factors is contained in the Company's quarterly and annual
reports as filed with the Securities and Exchange Commission.
BIG DOG HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
September 30,
----------------------------------------------------------
2005 2004
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ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 390,000 $ 2,330,000
Receivables, net 529,000 403,000
Inventories 58,573,000 51,791,000
Prepaid expenses and other current assets 1,478,000 1,214,000
Deferred income taxes 1,923,000 1,287,000
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Total current assets 62,893,000 57,025,000
PROPERTY AND EQUIPMENT, Net 10,756,000 10,520,000
INTANGIBLE ASSETS, Net 7,811,000 172,000
DEFERRED INCOME TAXES 1,613,000 1,292,000
OTHER ASSETS 360,000 420,000
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TOTAL $ 83,433,000 $ 69,429,000
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term borrowings $ 12,191,000 $ 15,628,000
Current portion of long-term debt 1,616,000 272,000
Accounts payable 14,577,000 7,720,000
Income taxes payable 1,006,000 452,000
Accrued expenses and other current liabilities 4,533,000 4,963,000
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Total current liabilities 33,923,000 29,035,000
NOTE PAYABLE 4,736,000 530,000
CAPITAL LEASE OBLIGATIONS 83,000 298,000
DEFERRED RENT AND LEASE INCENTIVES 1,376,000 953,000
DEFERRED GAIN ON SALE-LEASEBACK 208,000 261,000
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Total liabilities 40,326,000 31,077,000
STOCKHOLDERS' EQUITY 43,107,000 38,352,000
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TOTAL $ 83,433,000 $ 69,429,000
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BIG DOG HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
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2005 2004 2005 2004
-------------------- ------------------- ------------------- -------------------
NET SALES $ 44,909,000 $ 42,695,000 $ 119,695,000 $ 105,619,000
COST OF GOODS SOLD 19,623,000 19,262,000 53,502,000 47,934,000
-------------------- ------------------- ------------------- -------------------
GROSS PROFIT 25,286,000 23,433,000 66,193,000 57,685,000
-------------------- ------------------- ------------------- -------------------
OPERATING EXPENSES:
Selling, marketing and distribution 20,055,000 19,363,000 57,649,000 52,371,000
General and administrative 2,207,000 1,811,000 6,236,000 5,544,000
-------------------- ------------------- ------------------- -------------------
Total operating expenses 22,262,000 21,174,000 63,885,000 57,915,000
-------------------- ------------------- ------------------- -------------------
INCOME (LOSS) FROM OPERATIONS 3,024,000 2,259,000 2,308,000 (230,000)
OTHER INCOME - - - 82,000
INTEREST INCOME 1,000 5,000 42,000 25,000
INTEREST EXPENSE (170,000) (192,000) (618,000) (619,000)
-------------------- ------------------- ------------------- -------------------
INCOME (LOSS) BEFORE PROVISION 2,855,000 2,072,000 1,732,000 (742,000)
PROVISION (BENEFIT) FOR INCOME TAXES 1,085,000 788,000 658,000 (281,000)
-------------------- ------------------- ------------------- -------------------
NET INCOME (LOSS) $ 1,770,000 $ 1,284,000 $ 1,074,000 $ (461,000)
==================== =================== =================== ===================
NET INCOME (LOSS) PER SHARE
BASIC $ 0.19 $ 0.14 $ 0.12 $ (0.05)
==================== =================== =================== ===================
DILUTED $ 0.18 $ 0.13 $ 0.11 $ (0.05)
==================== =================== =================== ===================
WEIGHTED AVERAGE SHARES OUTSTANDING:
BASIC 9,141,000 9,189,000 9,169,000 8,568,000
==================== =================== =================== ===================
DILUTED 9,680,000 9,633,000 9,736,000 8,568,000
==================== =================== =================== ===================