Cost-U-Less Reports Earnings of 24 Cents Per Share for Fourth Quarter, 69 Cents Per Share for Fiscal Year 2004.BELLEVUE Bellevue (bĕl`vy  ).1 City (1990 pop. 30,982), Sarpy co., E Nebr., a suburb of Omaha, on the Missouri River; inc. 1855. , Wash. -- Cost-U-Less, Inc. (the "Company") (Nasdaq:CULS CULS Capital University Law School (Columbus, Ohio) ) today announced results for the fourth fiscal quarter and fiscal year ended December December: see month. 26, 2004. Highlights for the fourth fiscal quarter ended December 26, 2004, were as follows: --EPS of $0.24 compared to EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. of $0.15 for Q4 2003. --Sales of $57.4M, a 13.8% increase over Q4 2003. --Comparable store sales (stores open a full 13 months) increase of 11.5% over Q4 2003. For the fourth fiscal quarter of 2004 the Company reported net income of $960,000, or $0.24 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 outstanding, compared to net income of $568,000, or $0.15 per fully diluted share outstanding for the corresponding period last year. For the fiscal year 2004, net income increased to $2.7 million, or $0.69 per fully diluted share outstanding, compared to net income of $1.4 million, or $0.38 per fully diluted share outstanding, for fiscal year 2003. As previously reported, total sales for the fiscal quarter ended December 26, 2004, increased 13.8% to $57.4 million, compared to $50.5 million for the same period a year ago as the Company benefited from strong comparable store sales of 11.5%. Total sales for the fiscal year ended December 26, 2004, increased 18.3% to $209.4 million, compared to $177.1 million for fiscal year 2003. Total sales for the fiscal year ended December 26, 2004, compared to the prior fiscal year benefited from a 13.6% increase in comparable store sales, and from sales of the Dededo, Guam Dededo is the most populous village of the American island of Guam. According to the U.S. census bureau estimates, Dededo's population was 46,000 in 2004. The village is located on the coral plateau of Northern Guam. store which reopened on October October: see month. 3, 2003. Comparable store sales for the fiscal quarter and year ending December 26, 2004, are calculated on stores excluding the Guam Guam (gwäm), Chamorro Guåhan, the largest, most populous, and southernmost of the Mariana Islands (see also Northern Mariana Islands, an unincorporated territory of the United States (2005 est. pop. market as the Company's Dededo store was closed for most of fiscal 2003. "Our results for this quarter cap off an outstanding year. In a year proven to be challenging for other grocery retailers, we grew sales by 18.3% and our comparable store sales increased 13.6%, a Company record," said J. Jeffrey Meder, the Company's President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "Our net profit margin improved for the year by fifty basis points to 1.28% of sales. We simply continue to execute on our strengths." For the fourth quarter of fiscal 2004, the Company's gross margins rose 0.8 points to 18.5% of sales compared to 17.8% for the same period a year ago, and for fiscal 2004 gross margins improved 0.6 points to 18.4% of sales compared to 17.8% for fiscal 2003. These improvements were due to several factors, including better sourcing, pricing, and merchandising merchandising Element of marketing concerned especially with the sale of goods and services to customers. One aspect of merchandising is advertising, which aims to capture the interest of the segment of the population most likely to buy the product. of goods in the Company's stores. As a percentage of sales, store expenses declined from 12.3% for the fourth quarter of fiscal 2003, to 12.1% for the fourth quarter of fiscal 2004. Store expense dollars increased 11.8% for the fourth quarter of fiscal 2004 over the same period a year ago due to several factors, including higher insurance and utility expenses, and volume related items such as labor costs and credit card fees. Cost-U-Less currently operates eleven stores in the Caribbean and Pacific region: U.S. Virgin Islands (2), Netherlands Antilles Netherlands Antilles, island group, an autonomous part of the Netherlands (2005 est. pop. 220,000), 371 sq mi (961 sq km), West Indies. Formerly known as the Dutch West Indies and Netherlands West Indies, they are divided into two groups. (2), Hawaiian Hawaiian, member of the Polynesian group of the Austronesian family of languages. Of the fewer than 10,000 people who speak Hawaiian, only a few hundred are native speakers, but the language is taught in some Hawaiian schools and remains important as a symbol of Islands (2), California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). (1), Guam (2), American Samoa American Samoa, officially Territory of American Samoa, unincorporated territory of the United States (2000 pop. 57,291), comprising the eastern half of the Samoa island chain in the South Pacific. (1), and Republic of Fiji (1). The Company builds its business through delivering high-quality U.S. and local goods, progressive merchandising practices, sophisticated distribution capabilities, and superior customer service, primarily to island markets. Additional information about Cost-U-Less is available at www.costuless.com. 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. This press release contains statements that 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. . These statements are made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions 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. Such statements, including comparable store sales expectations, trends in or expectations regarding the Company's revenue growth, and the Company's growth plans are all based on currently available operating, financial, and competitive information and are subject to various risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated, including that the Company may encounter substantial delays, increased expenses or loss of potential store sites due to the complexities, cultural differences, and local political issues associated with the regulatory and permitting processes in the island markets in which the Company may locate its stores. Prolonged pro·long tr.v. pro·longed, pro·long·ing, pro·longs 1. To lengthen in duration; protract. 2. To lengthen in extent. adverse occurrences affecting tourism or air travel, particularly to non-U non-U adj. Chiefly British Not characteristic of the upper class, especially in language usage. [non- + U2. .S. destinations, including political instability instability /in·sta·bil·i·ty/ (-stah-bil´i-te) lack of steadiness or stability. detrusor instability , armed hostilities hos·til·i·ty n. pl. hos·til·i·ties 1. The state of being hostile; antagonism or enmity. See Synonyms at enmity. 2. a. A hostile act. b. hostilities Acts of war; overt warfare. , terrorism, natural disasters or other activity that involves or affects air travel or the tourism industry generally, could cause actual results to differ materially from historical results or those anticipated. Other risks and uncertainties include the Company's small store base; the mix of geographic and product revenues; relationships with third parties; litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. ; the Company's ability to maintain existing credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities and obtain additional credit; business and economic conditions and growth in various geographic regions; pricing pressures; political and regulatory instability in various geographic regions; and other risks and uncertainties detailed in the Company's filings with the SEC.
COST-U-LESS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
(Unaudited)
13 Weeks Ended 52 Weeks Ended
----------------------- -----------------------
Dec. 26, Dec. 28, Dec. 26, Dec. 28,
2004 2003 2004 2003
----------- ----------- ----------- -----------
Net sales $ 57,411 $ 50,464 $ 209,390 $ 177,066
Merchandise costs 46,765 41,493 170,866 145,563
---------- ---------- ---------- ----------
Gross profit 10,646 8,971 38,524 31,503
Operating expenses:
Store 6,944 6,210 26,408 22,304
General and
administrative 2,007 2,145 7,103 6,853
Store openings 51 79 188 287
---------- ---------- ---------- ----------
Total operating
expenses 9,002 8,434 33,699 29,444
---------- ---------- ---------- ----------
Operating income 1,644 537 4,825 2,059
Other income
(expense):
Interest expense,
net (106) (139) (437) (458)
Other 62 550 80 710
---------- ---------- ---------- ----------
Income before income
taxes 1,600 948 4,468 2,311
Income tax provision 640 380 1,780 930
---------- ---------- ---------- ----------
Net income $ 960 $ 568 $ 2,688 $ 1,381
========== ========== ========== ==========
Earnings per common
share:
Basic $ 0.26 $ 0.16 $ 0.72 $ 0.38
========== ========== ========== ==========
Diluted $ 0.24 $ 0.15 $ 0.69 $ 0.38
========== ========== ========== ==========
Weighted average
common shares
outstanding, basic 3,745,503 3,636,823 3,731,754 3,613,988
========== ========== ========== ==========
Weighted average
common shares
outstanding, diluted 4,030,486 3,807,643 3,915,808 3,670,908
========== ========== ========== ==========
COST-U-LESS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(Unaudited)
Dec. 26, Dec. 28,
2004 2003
------------- ------------
ASSETS
-------------------------------------------
Current assets:
Cash and cash equivalents $ 6,081 $ 4,093
Insurance receivable 0 1,135
Accounts receivable, net 805 1,366
Inventories, net 23,140 19,540
Other current assets 1,053 1,145
------------ -----------
Total current assets 31,079 27,279
Property and equipment, net 14,345 12,862
Deposits and other assets 778 799
------------ -----------
Total assets $ 46,202 $ 40,940
============ ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
-------------------------------------------
Current liabilities:
Accounts payable $ 16,132 $ 15,240
Accrued expenses and other liabilities 5,964 4,245
Line of credit 0 960
Current portion of long-term debt 267 267
Current portion Capital Leases 102 0
------------ -----------
Total current liabilities 22,465 20,712
Other long-term liabilities 920 684
Long-term debt, less current portion 2,277 2,544
Capital Lease, less current portion 607 0
------------ -----------
Total liabilities 26,269 23,940
Commitments and contingencies
Shareholders' equity 19,933 17,000
------------ -----------
Total liabilities and shareholders'
equity $ 46,202 $ 40,940
============ ===========
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