Cost-U-Less Reports Second Quarter Results; Reflecting Charge for New Zealand Store Closures.Business Editors PRESTON Preston, city (1991 pop. 166,675) and district, Lancashire, N England, on the Ribble River. Preston has an active port and is a center of cotton and rayon manufacturing. , Wash.--(BUSINESS WIRE)--July 26, 2000 Cost-U-Less, Inc. (the "Company") (Nasdaq:CULS CULS Capital University Law School (Columbus, Ohio) ) today reported a net loss of $5.1 million, or $1.40 per average 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 June June: see month. 25, 2000, compared to net income of $0.5 million, or $.13 per average fully diluted share outstanding in second quarter 1999. The results were negatively impacted by a $3.4 million charge for costs related to closing the 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. stores in June 2000, and $1.3 million for New Zealand overhead expenses and store operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. . The balance of the net loss resulted from other non-recurring expenses unrelated to New Zealand. The Company has elected e·lect v. e·lect·ed, e·lect·ing, e·lects v.tr. 1. To select by vote for an office or for membership. 2. To pick out; select: elect an art course. not to take tax benefits related to its losses in fiscal 2000, except for a $.2 million reversal reversal n. the decision of a court of appeal ruling that the judgment of a lower court was incorrect and is reversed. The result is that the lower court which tried the case is instructed to dismiss the original action, retry the case, or is ordered to change its of tax expense recorded in first quarter 2000. "While we are disappointed in our second quarter results, this painful and costly action will help position us for growth. Our plans include continuing to address profitability issues in other under-performing stores," said J. Jeffrey Meder, 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. . "We believe we have contained the negative cash flow caused by the New Zealand operations, and have put ourselves in a position to apply our capital and other resources to more promising markets. We had a successful store opening in St. Maarten on June 29, 2000. Although it is early, the store is meeting our expectations and we believe our model can be successful in markets where there is an established awareness and acceptance of U.S. goods." Sales increased 7.7% in second quarter 2000 to $44.4 million, compared to $41.2 million in the same period in 1999. The increase in sales was due primarily to the New Zealand stores, which opened in fourth quarter 1999, and increased business sales. Comparable store sales in second quarter 2000 were virtually flat compared to second quarter 1999. Cost-U-Less, a leading operator of non-membership warehouse "club-style" stores, currently operates 12 stores in U.S. territory and foreign island markets.
COST-U-LESS, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET
($ in thousands)
June 25, 2000 Dec. 26, 1999
-------- ------------
ASSETS
Current assets:
Cash and cash equivalents $ 1,264 $ 792
Receivables, net 992 2,122
Inventories, net 20,682 21,605
Other current assets 1,920 1,552
-------- --------
Total current assets 24,858 26,071
Property and equipment, net 17,179 16,563
Deposits and other assets 977 1,041
-------- --------
Total assets $43,014 $43,675
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $12,468 $14,387
Accrued expenses and
other liabilities 5,745 2,382
Line of credit 5,858 2,163
Current portion of
long-term liabilities 790 1,147
-------- --------
Total current liabilities 24,861 20,079
Deferred rent 459 414
Long-term debt less current portion 3,474 2,517
-------- --------
Total liabilities 28,794 23,010
Total shareholders' equity 14,220 20,665
Total liabilities and
shareholders' equity $43,014 $43,675
======== =========
COST-U-LESS, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except share and per share data)
13 WEEKS ENDED 26 WEEKS ENDED
-------------------------------------------
June 25, June 27, June 25, June 27,
2000 1999 2000 1999
-------------------------------------------
Net sales $ 44,402 $ 41,227 $ 88,674 $ 79,214
Merchandise costs 38,126 34,358 75,742 65,960
-------------------------------------------
Gross profit 6,276 6,869 12,932 13,254
Operating expenses:
Store 5,292 4,551 10,585 8,774
General and
administrative 2,274 1,366 3,861 2,710
Store opening 437 142 570 417
Store closing 3,372 0 3,372 0
-------------------------------------------
Total operating expenses 11,375 6,059 18,388 11,901
-------------------------------------------
Operating income (loss) (5,099) 810 (5,456) 1,353
Other income (expense):
Other income (expense) (25) 9 (60) (57)
Interest income 23 1 71
Interest expense (153) (123) (290) (222)
-------------------------------------------
Income (loss) before
income taxes (5,277) 719 (5,805) 1,145
Income tax provision
(benefit) (220) 242 0 392
-------------------------------------------
Net income (loss) $ (5,057) $ 477 $ (5,805) $ 753
===========================================
Earnings (loss) per common
share:
Basic and Diluted $ (1.40) $ 0.13 $ (1.61) $ 0.21
Weighted average common
shares outstanding 3,606,376 3,547,340 3,591,781 3,543,651
===========================================
Weighted average common
shares outstanding,
assuming dilution 3,612,641 3,611,977 3,609,696 3,610,530
===========================================
|
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion