1-800-FLOWERS.COM Reports Revenues of $230 Million for its Fiscal 2005 Second Quarter Driven by Online Revenue Growth of 18 Percent.WESTBURY Westbury, residential village (1990 pop. 13,060), Nassau co., SE N.Y., on Long Island; settled 1650, inc. 1932. The State Univ. of New York's Westbury campus is located in the village. Harness races are held at Roosevelt Raceway there. , N.Y. -- 1-800-FLOWERS.COM (1) (Computer Output Microfilm) Creating microfilm or microfiche from the computer. A COM machine receives print-image output from the computer either online or via tape or disk and creates a film image of each page. (R), Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : FLWS FLWS Force Level Warfare Systems ) --Net income was $8.7 million, or $0.13 per fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share. On a comparative basis, pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta net income was $14.9 million, or $0.22 per fully-diluted share compared with $14.0 million, or $0.20 per fully diluted share, in the prior year period. --The Company issued revised guidance for fiscal 2005 stating pre-tax income for the year will be flat compared with the prior year as it increases investments in marketing, infrastructure and new business development to achieve accelerated revenue growth. 1-800-FLOWERS.COM(R), Inc. (NASDAQ: FLWS), a leading multi-channel See multichannel. retailer of thoughtful gifts for all occasions, today reported record revenues of $230 million in its recent fiscal second quarter ended December December: see month. 26, 2004. The revenue figure represents total growth of 7.9 percent compared with revenue of $213.2 million in the prior year period. Online revenues increased 18.5 percent to $107.7 million compared with $90.9 million in the second quarter of 2004. Telephonic revenues were $109.6 million, down 3.4 percent compared with $113.4 million reported in the prior year period, reflecting the increased utilization utilization, n 1. the extent to which a given group uses a particular service in a specified period. Although usually expressed as the number of services used per year per 100 or per 1000 persons eligible for the service, utilization rates may be of the Company's online channels. Retail and Fulfillment ful·fill also ful·fil tr.v. ful·filled, ful·fill·ing, ful·fills also ful·fils 1. To bring into actuality; effect: fulfilled their promises. 2. revenues increased 42.9 percent to $12.8 million compared with $8.9 million in the prior year period, primarily reflecting increased sales of products and services to the Company's Bloomnet network of florists and fulfillment services revenues associated with the Wine Tasting Noun 1. wine tasting - a gathering of people to taste and compare different wines assemblage, gathering - a group of persons together in one place wine tasting n → degustación f de vinos Network business acquired during the quarter. The Company said a strong December finish to the holiday shopping season enabled it to achieve double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. sales growth for the quarter in several of its key gift categories including its gourmet food gifts, unique children's gifts, and expanded line of gift baskets A gift basket, or fruit basket is typically a gift that is delivered to the recipient at their home or workplace. There are different varieties of gift baskets, some which have fruit only, some with dry/canned goods only (such as tea, crackers and jam) although the standard . Sales of the Company's home decor gift items increased 1.8 percent for the quarter, aided by an increase of 11.0 percent in December which reversed the negative sales trend experienced in this category during fiscal 2004 and into early fiscal 2005. Floral flo·ral adj. Of, relating to, or suggestive of a flower: a fabric with a floral pattern. flo gift sales for the quarter increased 6.0 percent and represented 33.7 percent of total revenues, essentially unchanged from the prior year. The Company's gross profit margin Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. for the quarter was 44.6 percent, compared with 44.9 percent in the prior year period. The slightly lower gross profit margin primarily reflects the effect of increased shipping costs and holiday-season promotional pricing. During the quarter, the Company also increased its marketing investments in evolving areas including search and affiliate marketing Affiliate marketing is a method of promoting web businesses (merchants/advertisers) in which an affiliate (publisher) is rewarded for every visitor, subscriber, customer, and/or sale provided through his/her efforts. , as well as in a variety of direct marketing and broadcast advertising programs. Despite these increased marketing investments, the Company was able to improve its operating expense Operating Expense The essential things that a company must purchase in order to maintain business. Notes: For example, the payment of employees wages are an operating expense. Also known as OPEX. ratio by 10 basis points to 38.2 percent. The combination of revenue growth and improved operating expense ratio, somewhat offset by lower gross profit margin, enabled the Company to achieve net income of $8.7 million, or $0.13 per fully diluted share. This compares with net income of $13.7 million, or $0.20 per fully diluted share in the prior year period. Importantly, in the prior year period, the Company was not required to provide for income taxes as it was prior to the recognition of our deferred tax asset which occurred in last years fiscal fourth quarter. On a comparative basis, pre-tax net income for the quarter was $14.9 million, or $0.22 per fully-diluted share compared with $14.0 million, or $0.20 pre fully-diluted share, in the second quarter last year. Jim McCann McCann is the surname of several people, including:
adj. 1. Almost exact or correct: the approximate time of the accident. 2. 8 percent. Importantly, this growth was driven by our online channel which increased more than 18 percent compared with the prior year period. In addition, we saw double digit Noun 1. double digit - a two-digit integer; from 10 to 99 integer, whole number - any of the natural numbers (positive or negative) or zero; "an integer is a number that is not a fraction" revenue increases in several of the gift categories that we have identified as primary growth areas for the future, particularly our expanded food, wine and gift baskets category." McCann also noted that, during the quarter, the Company achieved a turnaround Turnaround A situation where a company that has had poor performance for an extended period of time experiences a positive reversal. Notes: A speculator may profit from a turnaround if he or she accurately anticipates the improvement of a poorly performing company. in its home decor business, which grew revenues 11 percent in December. "This reflects the significant progress we have made in successfully implementing changes to enhance the creative look and feel, the product offering and the overall marketing programs in this category," he said. The Company's multi-channel customer access and its expanded gift offerings helped attract more than 1.2 million new customers during the second quarter, 54 percent of whom (approximately 650,000) came to the Company online. Approximately 2.5 million customers placed orders during the period of which 51.3 percent were repeat customers, up from 48.7 percent in the second quarter of fiscal 2004. This reflects the Company's emphasis on deepening deep·en tr. & intr.v. deep·ened, deep·en·ing, deep·ens To make or become deep or deeper. Noun 1. deepening - a process of becoming deeper and more profound its relationship with existing customers through all of its marketing and selling efforts. Company Guidance: The Company said it plans to increase investments in three areas that it believes offer significant opportunities for revenue and profit growth. These include: (1) marketing programs including search, affiliate marketing and broadcast advertising in an effort to increase customer acquisition and thereby accelerate revenue growth during the second half of its fiscal year and beyond; (2) infrastructure investments, primarily personnel-related, in support of its Bloomnet(R) business-to-business  This article or section needs copy editing for grammar, style, cohesion, tone and/or spelling.You can assist by [ editing it] now. operations to grow revenues and market share in this area of the floral gift industry; and (3) investments in the technology platform, marketing programs and personnel for its recently acquired wine business to enhance both its winery win·er·y n. pl. win·er·ies An establishment at which wine is made. Noun 1. winery - distillery where wine is made wine maker services capabilities and expand its direct-to-consumer wine gift and wine club businesses. As a result of these increased investments, the Company said that it has targeted: --Revenue growth of approximately 10 percent during the second half of fiscal 2005. --Fiscal third quarter pre-tax earnings to be break-even and fiscal fourth quarter and full-year pre-tax earnings to be relatively flat compared with fiscal 2004. "As we enter the second half of our fiscal year, we are stepping up our marketing investments, particularly in evolving areas including search, affiliate marketing and broadcast advertising where we have been seeing some good results. We believe this will enable us to accelerate our revenue growth rate toward achieving sustainable double digit growth, both for the second half of this year and beyond. These investments reflect our strategy to become more aggressive in terms of customer acquisition as well as our response to the increasingly competitive marketplace, particularly in our core floral gift category," said McCann. McCann also noted that the Company will make investments to grow its business-to-business operations in the floral gift category. "The strength of our Bloomnet Network of fulfilling florists and our Bloomlink communications system In telecommunication, a communications system is a collection of individual communications networks, transmission systems, relay stations, tributary stations, and data terminal equipment (DTE) usually capable of interconnection and interoperation to form an integrated whole. positions us well to begin to grow our market share in the B2B (Business to Business) Refers to one business communicating with or selling to another. See B2B e-commerce, B2C and B2G. B2B - business to business side of the floral industry Floral industry is one of the major industries in many developing and underdeveloped countries. Floriculture as an industry began in the late 1800s in England, where flowers were grown on a large scale on the vast estates. . We believe that, over the next several years, we can add significantly to our revenue and profitability in this area through sales of an expanding range of products and services to our floral network members. We are also investing in our recently acquired wine gift business to enhance its technology platform and its marketing and personnel to expand its winery services capabilities and its direct-to-consumer wine gift and wine club businesses. We believe the wine gift market is poised for significant growth over the next several years and the investments we are making in this platform will enable us to build a leadership position in this business." said McCann. About 1-800-FLOWERS.COM(R) For more than 25 years, 1-800-FLOWERS.COM, Inc. (NASDAQ: FLWS) has been the leading innovator in the floral industry, taking the extra step to help people connect and express themselves quickly and easily with exquisite ex·qui·site n. Extremely intense, keen, or sharp. Used of pain or tenderness. floral gifts crafted with care by renowned artisans and the nation's leading florists, as well as distinctive non-floral gifts appropriate for any occasion or sentiment Sentiment can refer to:
represent this season. [Art: Hall, 129] See : Spring Flowers Anthea epithet of Hera, meaning “flowery.” [Gk. Myth. , plants, gourmet foods and confections, gift baskets and other impressive unique gifts. As always, satisfaction is guaranteed, and customer service is paramount Paramount (pâr`əmount'), city (1990 pop. 47,669), Los Angeles co., S Calif.; inc. 1957. Originally a dairy region, it has become highly industrialized since the 1950s. with quick, convenient ordering options, fast and reliable delivery, and gift advisors always available. Customers can shop 1-800-FLOWERS.COM 24-hours a day, seven-days a week via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the (http://www.1800flowers.com); by calling 1-800-FLOWERS(R) (1-800-356-9377); or by visiting a Company-operated or franchised store. The 1-800-FLOWERS.COM family of brands also includes home decor and garden merchandise MERCHANDISE. By this term is understood all those things which merchants sell either wholesale or retail, as dry goods, hardware, groceries, drugs, &c. It is usually applied to personal chattels only, and to those which are not required for food or immediate support, but such as remain from Plow plow or plough, agricultural implement used to cut furrows in and turn up the soil, preparing it for planting. The plow is generally considered the most important tillage tool. & Hearth(R) (1- 800-627-1712 or http://www.plowandhearth.com); premium popcorn and specialty A contract under seal. A specialty is a written document that has been sealed and delivered and is given as security for the payment of a specifically indicated debt. treats from The Popcorn Factory(R) (1-800-541-2676 or http://www.thepopcornfactory.com); gourmet foods from GreatFood.com(R) (http://www.greatfood.com); children's gifts from HearthSong(R) (http://www.hearthsong.com) and Magic Cabin(R) (http://www.magiccabin.com) and wine gifts from The Wine Tasting Network (www.ambrosiawine.com and www.winetasting wine·tast·ing n. A gathering of people to taste and compare a number of wines. .com). Special Note Regarding Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. : A number of statements contained in this press release, other than statements of historical fact, are forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. These statements involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. in the applicable statements. These risks and uncertainties include, but are not limited to: the Company's ability to profitably grow its business during the second half of its fiscal year; its ability to integrate and profitably grow the businesses of its acquired companies; its ability to maintain and enhance its online shopping web sites to attract customers; its ability to successfully introduce new products and product categories; its ability to provide timely fulfillment of customer orders; its ability to cost effectively acquire and retain customers; its ability to compete against existing and new competitors COMPETITORS, French law. Persons who compete or aspire to the same office, rank or employment. As an English word in common use, it has a much wider application. Ferriere, Dict. de Dr. h.t. ; its ability to cost efficiently manage inventories and general consumer sentiment and economic conditions that may affect levels of discretionary customer purchases of the Company's products. For a more detailed description of these and other risk factors, please refer to the Company's SEC filings including the Company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. and Quarterly Reports on Form 10-Q Form 10-Q See 10-Q. . The Company expressly disclaims any intent or obligation to update any of the forward looking statements made in this release, or in any of its SEC filings except, as may be otherwise stated by the Company.
1-800-FLOWERS.COM, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands)
December 27, June 27,
2004 2004
------------- ---------
(unaudited)
Assets
Current assets:
Cash and equivalents $86,794 $80,824
Short-term investments 19,086 22,550
Receivables, net 20,660 9,013
Inventories 27,675 19,625
Deferred income taxes 18,522 16,463
Prepaid and other 2,137 1,517
------------- ---------
Total current assets 174,874 149,992
Property, plant and equipment, net 41,642 42,460
Investments 3,687 8,260
Goodwill 42,189 34,529
Other intangibles, net 2,266 2,598
Deferred income taxes 9,146 13,548
Other assets 8,714 10,165
------------- ---------
Total assets $282,518 $261,552
============= =========
Liabilities and stockholders' equity
Current liabilities:
Accounts payable and accrued expenses $81,017 $63,266
Current maturities of long-term debt and
obligations under capital leases 2,925 3,022
------------- ---------
Total current liabilities 83,942 66,288
Long-term debt and obligations under capital
leases 4,614 6,062
Other liabilities 3,108 2,812
------------- ---------
Total liabilities 91,664 75,162
Total stockholders' equity 190,854 186,390
------------- ---------
Total liabilities and stockholders' equity $282,518 $261,552
============= =========
1-800-FLOWERS.COM, Inc. and Subsidiaries
Selected Financial Information
Consolidated Statements of Income (Unaudited)
(In thousands, except for per share data)
Three Months Ended Six Months Ended
------------------- -------------------
December December December December
26, 28, 26, 28,
2004 2003 2004 2003
--------- -------- ---------- --------
Net revenues:
Online $107,686 $90,878 $160,772 $139,814
Telephonic 109,570 113,374 147,156 153,745
Retail/fulfillment 12,758 8,930 19,600 14,783
--------- -------- --------- ---------
Total net revenues 230,014 213,182 327,528 308,342
Cost of revenues 127,402 117,550 185,344 173,643
--------- -------- --------- ---------
Gross profit 102,612 95,632 142,184 134,699
Operating expenses:
Marketing and sales 72,841 66,762 102,733 95,608
Technology and development 3,292 3,503 6,396 6,934
General and administrative 7,954 7,577 15,556 15,356
Depreciation and amortization 3,770 3,843 7,666 7,760
--------- -------- --------- ---------
Total operating expenses 87,857 81,685 132,351 125,658
--------- -------- --------- ---------
Operating income 14,755 13,947 9,833 9,041
Other income (expense):
Interest income 275 223 657 415
Interest expense (124) (186) (265) (419)
Other 21 (14) 25 (213)
--------- -------- --------- ---------
Total other income (expense),
net 172 23 417 (217)
--------- -------- --------- ---------
Income before income taxes 14,927 13,970 10,250 8,824
Income taxes (6,223) (292) (4,256) (292)
--------- -------- --------- ---------
Net income $8,704 $13,678 $5,994 $8,532
========= ======== ========= =========
Net income per common share:
Basic $0.13 $0.21 $0.09 $0.13
========= ======== ========= =========
Diluted $0.13 $0.20 $0.09 $0.12
========= ======== ========= =========
Weighted average shares used in
the calculation of net income
per common share:
Basic 66,061 65,881 66,135 65,828
========= ======== ========= =========
Diluted 67,637 69,074 67,627 68,811
========= ======== ========= =========
Calculation of pre-tax income per share:
Income before income taxes $14,927 $13,970 $10,250 $8,824
======== ======== ======== =======
Income before income taxes per
common share:
Basic $0.23 $0.21 $0.15 $0.13
======== ======== ======== =======
Diluted $0.22 $0.20 $0.15 $0.13
======== ======== ======== =======
Weighted average shares used in the
calculation of income before
income taxes per common share:
Basic 66,061 65,881 66,135 65,828
======== ======== ======== =======
Diluted 67,637 69,074 67,627 68,811
======== ======== ======== =======
1-800-FLOWERS.COM, Inc. and Subsidiaries
Selected Financial Information
Consolidated Statements of Cash Flows
(In thousands)
(unaudited)
Six Months Ended
-----------------
December December
26, 28,
2004 2003
-------- --------
Operating activities:
Net Income $5,994 $8,532
Reconciliation of net income to net cash
provided by operations:
Depreciation and amortization 7,666 7,760
Deferred income taxes 4,256 -
Bad debt expense 146 279
Other non-cash items - 157
Changes in operating items:
Receivables (11,078) (8,198)
Inventories (7,719) 1,941
Prepaid and other (620) (542)
Accounts payable and accrued expenses 15,765 16,154
Other assets 1,592 619
Other liabilities 296 219
-------- --------
Net cash provided by operating activities 16,298 26,921
Investing activities:
Purchase of investments (32,866) (23,018)
Sale of investments 40,903 36,250
Acquisition of business (9,674) -
Capital expenditures, net of non-cash expenditures (5,653) (4,296)
Other 2 145
-------- --------
Net cash (used in) provided by investing
activities (7,288) 9,081
Financing activities:
Acquisition of treasury stock (2,175) -
Proceeds from employee stock options/purchase plan 645 1,005
Repayment of notes payable and bank borrowings (654) (528)
Payment of capital lease obligations (856) (862)
-------- --------
Net cash used in financing activities (3,040) (385)
-------- --------
Net change in cash and equivalents 5,970 35,617
Cash and equivalents:
Beginning of period 80,824 49,079
-------- --------
End of period $86,794 $84,696
======== ========
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