Exhibit 99.1
The Bon-Ton Stores, Inc. Announces Third Quarter Results
YORK, Pa.--(BUSINESS WIRE)--Nov. 25, 2003--The Bon-Ton Stores,
Inc. (NASDAQ: BONT) today reported results for the third quarter ended
November 1, 2003.
Income
The Company reported a net loss in the third quarter of $1.7
million, or $0.11 per share, including an asset impairment charge of
$0.10 per share, compared to net income of $0.3 million, or $0.02 per
share, for the same period of fiscal 2002. In the third quarter of
fiscal 2003, as part of the integration of Bon-Ton and Elder-Beerman,
the Company recorded an asset impairment charge of $2.3 million
pre-tax, reflecting the write-off of duplicate information systems
software and related costs. For the nine months ended November 1,
2003, the Company reported a net loss of $3.8 million, or $0.25 per
share, including the asset impairment charge of $0.10 per share,
versus a net loss of $5.6 million, or $0.37 per share, reported for
the comparable period last year.
The results for the third quarter and year-to-date periods reflect
nine days of operations and preliminary purchase accounting
adjustments for Elder-Beerman.
Sales
As previously announced, third quarter total sales increased 7.7%
to $180.4 million from $167.5 million in the prior year. Comparable
store sales decreased 0.8%. Year-to-date total sales increased 0.6% to
$474.7 million from $471.9 million for the same period last year.
Comparable store sales decreased 2.0%.
As a result of Bon-Ton's acquisition of Elder-Beerman, effective
October 24, 2003, total sales include $15.3 million from the
Elder-Beerman stores for the period from October 24, 2003 through
November 1, 2003. Comparable store sales do not include sales from the
Elder-Beerman stores. Consistent with prior reporting, comparable
store sales reflect stores open and owned for the entire current and
prior year periods.
Gross Margin
The gross margin rate in the third quarter decreased 0.2
percentage point to 37.2% this year versus 37.4% reported for the same
period last year. Year-to-date, gross margin increased nine tenths of
a percentage point to 37.1% versus 36.2% in the prior year.
Selling, General and Administrative Expenses
Selling, general and administrative (SG&A) expenses increased $6.4
million, including $4.5 million from Elder-Beerman operations, in the
third quarter; the expense rate increased to 34.2% of sales in the
period, compared to 33.0% of sales for the prior year period. The
year-to-date SG&A expense rate increased five tenths of a percentage
point to 34.3% versus 33.8% reported for the same period last year,
with an expense increase of $3.0 million over last year.
Depreciation and Amortization:
The increase in depreciation expense of $2.4 million in the
quarter and year-to-date periods reflects the $2.3 million asset
impairment charge discussed in the Income section of this release.
Comments
James H. Baireuther, Vice Chairman and Chief Administrative
Officer, commented, "We continue to work on the integration of Bon-Ton
and Elder-Beerman divisions, but remain focused on achieving our
fourth quarter planned results. Although comparable store sales in the
third quarter declined slightly, we were able to manage gross margin
and expenses so the reduction in earnings, excluding the impairment
charge, was minimized. We are pleased with our merchandise assortment,
in-stock position and level of inventory as we enter the all-important
holiday selling season."
The Company's quarterly conference call to discuss third quarter
results will be broadcast live over the Internet on November 25, 2003
at 10:00 a.m. eastern time. To access the call, please visit the
investor relations section of the Company's website at
http://www.bonton.com/investor/home.asp. An online archive of the
broadcast will be available within one hour after the conclusion of
the call.
The Bon-Ton Stores, Inc. operates 142 department stores in sixteen
states from the northeast to the midwest under the names of Bon-Ton
and Elder-Beerman. The stores carry a broad assortment of quality,
brand-name fashion apparel and accessories for women, men and
children, as well as distinctive home furnishings. The Bon-Ton enjoys
a strong reputation for providing quality merchandise at competitive
prices delivered with top-quality service in targeted markets.
Statements made in this press release, other than statements of
historical information, are forward looking statements and are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Such statements involve risks and
uncertainties that may cause results to differ materially from those
set forth in these statements. Factors that could cause such
differences include, but are not limited to, risks related to retail
businesses generally, additional competition from existing and new
competitors, uncertainties associated with opening new stores or
expanding or remodeling existing stores, the Company's presence in and
dependence on limited geographic markets, the ability to attract and
retain qualified management, the dependence upon key vendor
relationships and the ability to obtain financing for working capital,
capital expenditures and general corporate purposes. Additional
factors that could cause the Company's actual results to differ from
those contained in these forward looking statements are discussed in
greater detail in the Company's periodic reports filed with the
Securities and Exchange Commission.
THE BON-TON STORES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
THIRTEEN THIRTY-NINE
WEEKS ENDED WEEKS ENDED
---------------------------------------------------
(In thousands November 1, November 2, November 1, November 2,
except share and
per share data)
(Unaudited) 2003 2002 2003 2002
- ------------------- ------------ ------------ ------------ -----------
Net sales $ 180,417 $ 167,542 $ 474,656 $ 471,949
Other income, net 619 520 1,709 1,607
------------ ------------ ------------ -----------
181,036 168,062 476,365 473,556
------------ ------------ ------------ -----------
Costs and
expenses:
Costs of
merchandise
sold 113,313 104,878 298,551 301,234
Selling,
general and
administrative 61,690 55,301 162,664 159,670
Depreciation
and
amortization 7,330 4,945 17,217 14,849
------------ ------------ ------------ -----------
Income (loss) from
operations (1,297) 2,938 (2,067) (2,197)
Interest expense,
net 1,437 2,413 3,983 6,789
------------ ------------ ------------ -----------
Income (loss)
before income
taxes (2,734) 525 (6,050) (8,986)
Income tax expense
(benefit) (1,032) 197 (2,258) (3,370)
------------ ------------ ------------ -----------
Net income (loss) $ (1,702) $ 328 $ (3,792) $ (5,616)
------------ ------------ ------------ -----------
Per share amounts --
Basic:
Net income
(loss) $ (0.11) $ 0.02 $ (0.25) $ (0.37)
------------ ------------ ------------ -----------
Basic weighted
average shares
outstanding 15,062,566 15,180,685 15,031,137 15,233,871
Diluted:
Net income
(loss) $ (0.11) $ 0.02 $ (0.25) $ (0.37)
------------ ------------ ------------ -----------
Diluted weighted
average shares
outstanding 15,062,566 15,392,437 15,031,137 15,233,871
CONTACT: The Bon-Ton Stores, Inc.
Corporate Communications:
Mary Kerr, 717-751-3071