Cost-U-Less Reports First Quarter Profit Compared to First Quarter Loss for Prior Year.Business Editors PRESTON, Wash.--(BUSINESS WIRE)--April 25, 2001 Cost-U-Less, Inc. (the "Company") (Nasdaq:CULS CULS Capital University Law School (Columbus, Ohio) ) today reported a net profit of $116,000, or $0.03 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, for the quarter ended April 1, 2001, compared to a net loss of $748,000, or $.21 per fully diluted share outstanding, for the corresponding quarter last year. EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become (earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
"This quarter's results provide further proof that the action we took almost a year ago to shed the unprofitable stores in New Zealand New Zealand (zē`lənd), island country (2005 est. pop. 4,035,000), 104,454 sq mi (270,534 sq km), in the S Pacific Ocean, over 1,000 mi (1,600 km) SE of Australia. The capital is Wellington; the largest city and leading port is Auckland. was the right decision," 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. . Sales for the first quarter of 2001 were relatively flat compared to a year ago. However, the profitability of sales improved as St Maarten store sales in the first quarter of 2001 replaced unprofitable New Zealand store sales in the first quarter of 2000. The Company continues to experience weak economies in many of its island locations. For example, Curacao has experienced a net population migration over the past year and the tuna fishing Tuna Fishing (Homage to Meissonier) was painted by Salvador Dalí in 1966-1967 and is seen by many as one of Dalí's last masterpieces. Filled chaotically with the violent struggle of the men in the picture and the big fish. industry in Samoa is severely depressed. Guam unemployment levels remain high. These conditions contributed to a decline in same stores sales of 4.6% for the first quarter of 2001 compared to the same quarter a year ago. Gross margin improved to 16.1% in the first quarter of 2001 from 15.4% in the fourth quarter of 2000 and from 15.0% in the same quarter a year ago. "We are pleased that lower sales volumes were largely offset by higher margins in many of our stores and relieved to be able to report margins without the drag of the New Zealand operations," added Meder. Inventory levels at the end of the first quarter of 2001 were higher than at the end of the fourth quarter of 2000 as stores replenished stock levels following stronger than expected sales at the end of December. Stores also built inventory in expectation of promotions and carnival carnival, communal celebration, especially the religious celebration in Catholic countries that takes place just before Lent. Since early times carnivals have been accompanied by parades, masquerades, pageants, and other forms of revelry that had their origins in celebrations early in the second quarter of 2001. Comparable store inventory at the end of the first quarter of 2001 was lower than at the end of the same period a year ago. 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 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 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. practices, sophisticated distribution capabilities, and superior customer service, primarily to island markets. Additional information about Cost-U-Less is available at www.costuless.com This press release contains statements that are forward-looking. 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. These statements are based on current expectations that are subject to risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated. These factors include, without limitation; future market opportunities for existing and planned products and services; the mix of geographic and product revenues; relationships with third parties; international operational risks; 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. ; 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.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except share and per share data)
13 WEEKS ENDED
--------------------------
April 1, 2001 March 26, 2000
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Net sales $ 43,978 $ 44,272
Merchandise costs 36,887 37,616
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Gross profit 7,091 6,656
Operating expenses:
Store 5,236 5,292
General and administrative 1,440 1,587
Store opening 23 133
Store closing (3) 0
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Total operating expenses 6,696 7,012
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Operating income (loss) 395 (356)
Other income (expense):
Other income (expense) 2 (35)
Interest expense (171) (137)
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Income (loss) before income taxes 226 (528)
Income tax provision 110 220
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Net income (loss) $ 116 $ (748)
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Earnings (loss) per common share:
Basic and Diluted $ 0.03 $ (0.21)
Weighted average common shares
outstanding 3,606,376 3,577,186
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Weighted average common shares
outstanding, assuming dilution 3,608,014 3,577,186
=========== ===========
Note: For 2000, common stock equivalents have been excluded from the
calculation, as their impact would be anti-dilutive.
Balance Sheet Information: (in thousands)
April 1, 2001 December 31, 2000
Merchandise Inventory $21,157 $18,001
Bank Line of Credit 3,593 2,700
Long-term Debt 3,544 3,611
Equity 15,043 14,888
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