Wilsons The Leather Experts Reports Third Quarter Results.MINNEAPOLIS--(BUSINESS WIRE)--Nov. 16, 1998--Wilsons The Leather Experts 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 NMS See NetWare Management System. : WLSN), the leading specialty retailer of leather outerwear, apparel and accessories, reported a third quarter net loss of $2.0 million, or 18 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. compared to a net loss of $5.9 million or 62 cents per share last year. Last year's net loss, adjusted for certain non-recurring items, was $2.0 million, or 21 cents per share. The after-tax nonrecurring items consisted of a $3.8 million extraordinary gain on early extinguishment The destruction or cancellation of a right, a power, a contract, or an estate. Extinguishment is sometimes confused with merger, though there is a clear distinction between them. of debt and a $7.6 million non-cash restricted stock compensation charge. Sales for the third quarter ended October 31, 1998, increased 7.6 percent to $87.5 million from $81.3 million last year. Comparable store sales for the third quarter decreased 0.3 percent. Year-to-date sales were $201.2 million, up 15.2 percent from $174.7 million one year ago. Year-to-date comparable store sales increased 8.2 percent. "The unseasonably warm weather, particularly in the Midwest, slowed sales of outerwear during September and October," said Joel Waller, Wilsons' chairman and chief executive officer. The nine-month net loss was $18.4 million, or $1.80 per shans The Leather Experts is the leading specialty rough December and intends to operate approximatual results may be materially different. Factorsimposed by lenders; increased competition in th--------------------------------- (Unaudited) 1998 oods sold, buying and occupancy costs Occupancy costs are the whole life costs of buildings and their associated land from occupancy until disposal. These costs may be incurred on a regular or irregular basis. Occupancy costs are those costs related to occupying a space including; rent, real estate taxes, personal 61,404 57,520 Selling, general and a 596 Restricted stock compensation expense - 7,611 ---------------------------------------------------------------------- Loss from operations (534) (8,310) ---------------------------------------------------------------------- Interest expense, net 2,695 2,521 ---------------------------------------------------------------------- Loss before income taxes (3,229) (10,831) ---------------------------------------------------------------------- Income tax benefit (1,239) (1,179) ---------------------------------------------------------------------- Loss before extraordinary item (1,990) (9,652) Extraordinary gain on early extinguishment of debt, net of tax of $2,509 - 3,763 ---------------------------------------------------------------------- Net loss $ (1,990) $ (5,889) ====================================================================== ---------------------------------------------------------------------- Basic net loss per common share: Loss before extraordinary item $ (0.18) $ (1.01) Extraordinary gain on early extinguishment of debt, net of tax - 0.39 ---------------------------------------------------------------------- Basic net loss per common share $ (0.18) $ (0.62) ====================================================================== Weighted average common shares outstanding 10,826 9,532 ====================================================================== 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. net loss per common share: Loss before extraordinary item $ (0.18) $ (1.01) Extraordinary gain on early extinguishment of debt, net of tax - 0.39 ------------------------------================================================e difference in inventories between the LIFO (Last In-First Out) A queueing method in which the next item to be retrieved is the item most recently placed in the queue. Contrast with FIFO. LIFO - stack mecost of goods sold would have been higher than reported by $350,000. WILSONS THE LEATHER EXPERT--------------------- YEAR-TO-DATE (----------------- Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight $ 201,228 $ 174,694 Costs and expenses: Cost of goods sold Cost of goods sold The total cost of buying raw materials, and paying for all the factors that go into producing finished goods. cost of goods sold , buying and occupancy costs ---------------------------------------------------------- Income tax benefit ---- Net loss $ (18,4 (3.39) Extraordinary gain on early exn share $ (1.80) $ (2.96) ====================================================================== Weighted average common shares outstanding 10,199 8,703 ====================================================================== ====================================================================== Diluted net loss per common share: Loss before extraordinary item $ (1.80) $ (3.39) Extraordinary gain on early extinguishment of debt, net of tax - 0.43 ---------------------------------------------------------------------- Diluted net loss per common share $ (1.80) $ (2.96) ====================================================================== Weighted average common shares outstanding - assuming dilution 10,199 8,703 ====================================================================== ====================================================================== Note: The Company's inventories are determined by the retail method on the last-in, first-out last-in, first-out n. A method of inventory accounting in which the most recently acquired items are assumed to have been the first sold. In a period of rising prices, this method yields a lower ending inventory, a higher cost of goods sold, a lower (LIFO) basis. The difference in inventories between the LIFO method and the first-in, first-out first-in, first-out n. A method of inventory accounting in which the oldest remaining items are assumed to have been the first sold. In a period of rising prices, this method yields a higher ending inventory, a lower cost of goods sold, a higher gross (FIFO (First In First Out) A storage method that retrieves the item stored for the longest time. Contrast with LIFO. See traffic engineering methods. FIFO - first-in first-out ) method was not material as of November 1, 1997. If the FIFO method of accounting had been used by the Company for the thirty-nine weeks ended October 31, 1998, cost of goods sold would have been lower than reported by $200,000. WILSONS THE LEATHER EXPERTS INC. AND SUBSIDIARIES CONDENSED con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. CONSOLIDATED BALANCE SHEETS consolidated balance sheet A balance sheet in which assets and liabilities of a parent company and its controlled subsidiaries are combined, thereby presenting balance sheet items for the parent and its subsidiaries as if they were a single firm. ---------------------------------------------------------------------- Oc (Unaudited) Current Assets Current Assets Appearing on a company's balance sheet, it represents cash, accounts receivable, inventory, marketable securities, prepaid expenses, and other assets that can be converted to cash within one year. : Cash 182,845 198,731 -- AND SHAREHOLDERS' EQUITY Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. Current Liabilities Current Liabilities Usually appearing on a company's balance sheet, it represents the amount owed for interest, accounts payable, short-term loans, expenses incurred but unpaid, and other debts due within one year. : liabilities 83,494 78,526 --------------------------------------------------------- 1,494 Shareholders' equity 61,572 72,652 ---------------------------------------------------------------------- Total Liabilities and Shareholders' Equity $ 222,518 $ 227,672 ====================================================================== Note: The Company's inventories are determined by the retail method on the last-in, first-out (LIFO) basis. The difference in inventories between the last-in, first-out (LIFO) method and first-in, first-out (FIFO) method was not material as of January 31, 1998. If the FIFO method of accounting had been used by the Company, inventories as of October 31, 1998 would have been $200,000 higher than reported. |
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