SYMS Syms Corp (MM)

Syms Corp (NASDAQ:SYMS), a leading off-price retailer, announced results today for its second quarter ended August 28, 2010.

Net sales increased $25.6 million or 34% to $102.1 million during the thirteen weeks ended August 28, 2010, from $76.4 million in the comparable period last year. For the year to date (26 week period) ended August 28, 2010, net sales increased by $96.8 million or 76% to $223.5 million from $126.7 million last year. The increase in sales this year was primarily the result of the acquisition of Filene’s Basement in June 2009. In addition, comparable store sales increased 16% and 14% in the thirteen and twenty-six week periods ended August 28, 2010, respectively.

For the quarter (13 week period) ended August 28, 2010, the Company had a net loss of $10.9 million ($0.76 per share) as compared to a net loss of $7.9 million ($0.54 per share) for the quarter ended August 29, 2009. For the year to date (26 week period) ended August 28, 2010, the Company had a net loss of $11.7 million ($0.81 per share) as compared to a net loss of $9.9 million ($0.68 per share) for the comparable period last year. The prior year periods included several one-time items that affect comparability, principally a bargain purchase gain associated with the Filene’s Basement acquisition and acquisition costs related to that transaction. Excluding those items the Company’s adjusted net loss for the quarter ended August 29, 2009 would have been $11.1 million ($0.76 per share), comparable to the current quarter’s loss. The adjusted net loss after excluding those items for the twenty-six weeks ended August 29, 2009 would have been $13.1 million ($0.90 per share), approximately 10% greater than the net loss for the twenty-six weeks ended August 28, 2010.

Adjusted net loss excluding items that affect comparability is a non-GAAP measure. The Company believes the excluded items are not indicative of the recurring performance of the business and that by providing this supplemental disclosure it will facilitate a more meaningful comparison of its operating performance. A reconciliation of net loss as reported to the adjusted net loss is included as a schedule in this press release.

As of August 28, 2010, the Company owned and operated 48 “off-price” apparel stores located predominantly on the east coast of the United States under the Syms and Filene’s Basement names. Each Syms and Filene’s Basement store offers a broad range of first quality, in season merchandise bearing nationally recognized designer and brand-name labels.

Forward-Looking Statements

Certain information in this press release includes forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995) and information relating to Syms Corp and its subsidiaries that are based on the beliefs of Syms’ management, as well as assumptions made by and information currently available to Syms’ management. When used in this press release, the words “anticipate”, “believe”, “estimate”, “expect”, “intend”, “plan” and similar expressions as they relate to Syms Corp and its subsidiaries, identify forward-looking statements. Such statements reflect the current views of Syms Corp with respect to future events, the outcome of which is subject to certain risks, including, among others, general economic and market conditions, decreased consumer demand for Syms’ and Filene’s Basement’s products, possible disruptions in Syms’ computer or telephone systems, possible work stoppages or increase in labor costs, effects of competition, the impact of integrating Filene’s Basement’s business and Syms Corp’s existing business, possible disruptions or delays in the opening of new stores or inability to obtain suitable sites for new stores, higher than anticipated store closings or relocation costs, higher interest rates and borrowing costs, unanticipated increases in merchandise or occupancy costs, and other factors which may be outside the control of Syms Corp. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results or outcomes may vary materially from those described herein as anticipated, believed, estimated, expected, intended or planned. Subsequent written and oral forward-looking statements attributable to Syms Corp or persons acting on its behalf are expressly qualified in their entirety by the cautionary statements in this paragraph.

 

SYMS CORP

STATEMENTS OF OPERATIONS

(in thousands except per-share amounts)

         

Thirteen Weeks Ended

Twenty-Six Weeks Ended

       

8/28/2010

8/29/2009

8/28/2010

8/29/2009

  Net Sales $ 102,073 $ 76,437 $ 223,518 $ 126,693   Gross Profit 37,123 28,173 90,866 49,234   Operating Expenses 54,818 40,400 109,809 63,352   Net Loss   ($10,930 )   ($7,889 )   ($11,739 )   ($9,924 )  

Net Loss per share (basic &diluted)

  ($0.76 )   ($0.54 )   ($0.81 )   ($0.68 )  

Weighted average sharesoutstanding (basic & diluted)

  14,448     14,590     14,463     14,590    

SYMS CORP

CONSOLIDATED BALANCE SHEETS

(in thousands)

               

August 28, 2010

August 29, 2009

ASSETS

 

  Current Assets: Cash $ 2,885 $ 8,059 Receivables 3,112 3,868 Merchandise inventories 99,429 96,126 Other current assets   22,820   21,388 Total current assets 128,246 129,441   Property & equipment 119,309 122,898 Other assets   42,509   31,934 Total Assets $ 290,064 $ 284,273     LIABILITIES & SHAREHOLDERS’ EQUITY Current Liabilities: Accounts payable $ 59,382 $ 67,781 Accrued expenses 12,066 9,601 Other current liabilities   5,280   5,274 Total current liabilities 76,728 82,656   Long term debt 25,951 23,977 Other long term liabilities 5,299 1,521   Shareholders’ Equity   182,086   176,119 Total Liabilities and Shareholders’ Equity $ 290,064 $ 284,273  

SYMS CORP

RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION TO GAAP

(in thousands except per-share amounts)

                   

Thirteen Weeks Ended

Twenty-Six Weeks Ended

 

8/28/2010

8/29/2009

8/28/2010

8/29/2009

  GAAP Net Loss ($10,930 ) ($7,889 ) ($11,739 ) ($9,924 )  

Transactions affectingcomparability:

 

Bargain purchase gain onFilene’s acquisition

- (9,407 ) - (9,407 )

Acquisition costs related toFilene’s acquisition

- 4,148 - 4,568        

Total impact of transactionsaffecting comparability

- (5,259 ) - (4,839 )   Income tax effect - 2,037 - 1,636        

Net impact of transactionsaffecting comparability

- (3,222 ) - (3,203 )   Adjusted Net Loss ($10,930 ) ($11,111 ) ($11,739 ) ($13,127 )  

GAAP Net Loss per share(basic & diluted)

($0.76 ) ($0.54 ) ($0.81 ) ($0.68 )  

Adjusted Net Loss per share(basic & diluted)

($0.76 ) ($0.76 ) ($0.81 ) ($0.90 )