Exhibit 99.1
Shoe Pavilion Announces Profit in First Quarter 2004
PINOLE, Calif.--(BUSINESS WIRE)--May 5, 2004--Shoe Pavilion, Inc. (Nasdaq
Small Cap Market: SHOE) today reported net income of $352,000 or $.05 per share
for the first quarter ended April 3, 2004, compared to a net loss of $1.3
million or ($.19) per share for the same period last year.
Net sales increased 5.3% to $19.6 million for the first quarter ended April
3, 2004, from net sales of $18.6 million for the same period in 2003. Comparable
store net sales increased 6.0% for the first quarter ended April 3, 2004 from
the same period last year.
Gross profit as a percentage on net sales increased to 33.8% for the first
quarter ended April 3, 2004 from 22.8% for the same period last year. This
improvement in gross profit was in part due to fewer markdowns taken in the
first quarter ended April 3, 2004.
Mr. Beinus, the Company's Chairman and CEO, stated, "I am extremely pleased
with the operating results for the first quarter, especially the progress the
Company has made in improving its gross profit."
During the quarter ended April 3, 2004 the Company closed one store in which
the lease had expired and opened one store bringing the total number of stores
the Company operates to 85.
Shoe Pavilion is an independent off-price footwear retailer on the West
Coast. It offers a broad selection of women's, men's and children's designer
label and name brand footwear such as Converse, Reebok, Skechers and Nine West,
typically at 20% to 60% below department store regular prices for the same
shoes. The Company has 85 stores in California, Washington and Oregon.
Safe Harbor Statement under the Private Securities Litigation Reform Act of
1995: This press release contains certain forward-looking statements that are
subject to risks and uncertainties that could cause the Company's actual results
to differ materially from management's current expectations. These factors
include, without limitation, competitive pressures in the footwear industry,
changes in the level of consumer spending on or preferences in footwear
merchandise, economic and other factors affecting retail market conditions, the
Company's ability to purchase attractive name brand merchandise at reasonable
discounts, the availability of desirable store locations as well as management's
ability to negotiate acceptable lease terms and maintain supplier and business
relationships and open new stores in a timely manner. Other risk factors are
detailed in the Company's filings with the Securities and Exchange Commission.
The Company intends these forward-looking statements to speak only at the time
of this release and does not undertake to revise or confirm them as more
information becomes available.
Shoe Pavilion, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share and number of stores)
Quarter Ended
-------------------
April 3, March 29,
2004 2003
Net sales $ 19,573 $ 18,583
Cost of sales and related occupancy expenses 12,948 14,346
--------- ---------
Gross profit 6,625 4,237
Selling, general and administrative expenses 5,969 6,374
--------- ---------
Income (loss) from operations 656 (2,137)
Interest expense (72) (60)
--------- ---------
Income (loss) before income taxes 584 (2,197)
Income tax benefit (expense) (232) 879
--------- ---------
Net income (loss) $ 352 ($1,318)
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Earnings (loss) per share:
Basic $ 0.05 $ (0.19)
Diluted $ 0.05 $ (0.19)
Weighted average shares outstanding:
Basic 6,800 6,800
Diluted 6,816 6,800
Stores operated at end of period 85 87
Shoe Pavilion, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands, except share data)
April 3, January 3, March 29,
2004 2004 2003
----------- ---------- -----------
ASSETS
CURRENT ASSETS:
Cash $ 1,194 $ 1,034 $ 1,503
Receivables 95 130 208
Income tax receivables 6 13 1,402
Inventories 30,187 26,960 34,210
Deferred income taxes 1,966 1,966 704
Prepaid expenses 1,743 1,521 444
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Total current assets 35,191 31,624 38,471
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Property and equipment, net 2,733 3,080 3,779
Deferred income taxes and other 1,588 1,605 1,026
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TOTAL $ 39,512 $ 36,309 $ 43,276
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Borrowings under credit agreement $ 3,775 $ 5,045 $ -
Accounts payable 10,456 6,720 9,154
Accrued expenses 4,116 3,680 2,481
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Total current liabilities 18,347 15,445 11,635
Long-term debt - - 9,300
Deferred rent 1,716 1,767 1,834
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Total liabilities 20,063 17,212 22,769
Commitments and contingencies - - -
STOCKHOLDERS' EQUITY:
Preferred stock - $.001 par value;
1,000,000 shares authorized; no
shares issued or outstanding - - -
Common stock - $.001 par value:
15,000,000 shares authorized;
6,800,000 shares issued and
outstanding 7 7 7
Additional paid-in capital 13,967 13,967 13,967
Retained earnings 5,475 5,123 6,533
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Total stockholders' equity 19,449 19,097 20,507
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TOTAL $ 39,512 $ 36,309 $ 43,276
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CONTACT: Shoe Pavilion, Inc.
John D. Hellmann, 510-222-4405