iParty Corp. Reports Q4 Net Profit, 14% Same Store Sales Increase.
BOSTON--(BUSINESS WIRE)--Feb. 28, 2002
iParty Corp. (AMEX: IPT), the nation's premier multi-channel retailer for party goods with 33 iParty retail stores and iParty.com, a destination site for party goods and party planning, today reported financial results for its fourth quarter and fiscal year 2001.
For the quarter, iParty Corp. reported consolidated revenues of $16.4 million from the Company's retail stores and its online website, www.iparty.com, compared to $14.6 million for the fourth quarter of 2000. The Company reported consolidated net income of $464,000 or $0.03 per share compared to a consolidated net loss of $6.7 million or $0.56 per share for the fourth quarter of 2000. Consolidated gross profit margin for the quarter was 40.9% compared to a margin of 41.3% for the fourth quarter of 2000. The number of common shares outstanding at December 29, 2001 was 15,122,675.
For the year ended December 29, 2001, iParty Corp. reported consolidated revenues of $48.0 million from the Company's retail stores and its online website, www.iparty.com, compared to $18.6 million for 2000. iParty Corp. acquired its retail stores in the third quarter of 2000. The Company reported a consolidated net loss of $2.4 million or $0.18 per share compared to a consolidated net loss of $20.9 million or $2.05 per share for 2000. Consolidated gross profit margin for the year was 39.6% compared to a margin of 37.0% for 2000.
Sal Perisano, Chief Executive Officer of iParty Corp., commented, "Last year was the turning point for iParty Corp. and we are very proud of these results. Achieving a 14% same store sales increase in the last thirteen weeks of the year compared to the same period last year in this difficult retail environment is a tremendous vote of confidence from our customers. We feel that this sales increase was the result of improvements to our product assortment, customer service and marketing. It is also obvious that we are benefiting from the so-called cocooning effect where families are placing a renewed emphasis on the home and the celebration of life's milestones.
"We are also very pleased with our net profit for the quarter. Throughout the year, we made continual efforts to streamline operations, manage inventory levels and control expenses and we are now starting to see the benefit of those efforts fall to the bottom line. Although there was a slight decrease in margin for the fourth quarter compared to the fourth quarter of 2000, we have been able to realize progressively better pricing from our vendors which will result in better margins next year.
"Looking ahead to 2002, we are confident that we will continue to see healthy increases in same store sales. We are also on track to open at least two new stores with internally generated funds. The first new store, located in Boston, is scheduled to open by the end of March. In 2002, we expect to be cash flow neutral for the year. We will continue to find ways to reduce our expenses, improve supply chain management and increase our margins. We are also encouraged by the fact that year-to-date sales have exceeded our expectations."
About iParty Corp.
Headquartered in Boston, Massachusetts, iParty Corp. (AMEX: IPT), is a premier multi-channel party supply and party planning company that includes 33 iParty retail stores and iParty.com, an online destination, that makes throwing a successful event both stress-free and fun. From over 20,000 party supplies and costumes to an online party magazine and party related content, iParty offers consumers a sophisticated yet fun and easy-to-use resource with a definitive assortment of products to customize any party, including birthday bashes, Easter get-togethers, graduation parties, summer barbecues, and, of course, Halloween. iParty offers reliable, time-tested knowledge of party-perfect trends, and superior customer service to ensure convenient and comprehensive merchandise selections for every occasion. Please visit our site at www.iparty.com.
Certain information included in this news release (as well as information included in oral statements or other written statements made or to be made by iParty.com) contains statements that are forward-looking, such as statements relating to anticipated future revenues of the company and the success of current product offerings. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may differ materially from those expressed in any forward-looking statements made by or on behalf of iParty Corp.
iPARTY CORP. CONSOLIDATED STATEMENTS OF OPERATIONS For the three months ended For the year ended Dec. 29, Dec. 30, Dec. 29, Dec. 30, 2001 2000 2001 2000 Revenues $ 16,429,653 $ 14,565,140 $ 47,983,404 $ 18,619,877 Operating costs: Cost of products sold 9,714,649 8,555,307 28,966,573 11,734,011 Amortization of partner warrant -- 3,399,698 -- 4,532,930 Marketing and sales 4,561,028 5,912,138 14,843,500 13,058,710 Product and technology development 595,218 548,096 2,134,390 5,173,828 General and administrative 899,621 1,647,347 3,762,617 3,725,704 Restructuring expenses (18,794) 1,093,328 (141,328) 1,093,328 Loss resulting from abandonment of assets -- 5,784 -- 5,784 Non-cash compensation expense 35,255 88,777 320,373 812,510 Operating profit/(loss) 642,676 (6,685,335) (1,902,721) (21,516,928) Interest income 7,209 88,991 117,431 733,163 Interest expense (186,078) (138,346) (651,016) (149,346) Net income/(loss) $ 463,807 $ (6,734,690) $ (2,436,306)$ (20,933,111) Loss per share: Basic $ 0.03 $ (0.56) $ (0.18) $ (2.05) Diluted $ 0.01 $ (0.56) $ (0.18) $ (2.05) Weighted average shares outstanding: Basic 14,323,955 11,944,365 13,411,866 11,321,578 Diluted 37,952,755 11,944,365 13,411,866 11,321,578 iPARTY CORP. CONSOLIDATED BALANCE SHEETS December 29, December 30, ASSETS 2001 2000 Current assets: Cash and cash equivalents $ 2,399,084 $ 5,002,254 Cash, restricted 667,957 635,000 Accounts receivable 541,703 948,292 Inventory 9,282,852 8,226,560 Prepaid expenses and other current assets 337,997 69,812 Total current assets 13,229,593 14,881,918 Property and equipment, net 979,042 903,849 Other assets 324,583 557,286 Total assets $ 14,533,218 $ 16,343,053 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 2,636,160 $ 2,415,679 Accrued expenses 2,396,760 3,209,617 Line of credit 3,354,977 2,800,790 Total current liabilities 8,387,897 8,426,086 Long-term liabilities 836,752 492,465 Total liabilities 9,224,649 8,918,551 Commitments and contingencies Stockholders' equity: Preferred stock 3,274 3,569 Common stock 15,123 12,175 Additional paid in capital 64,484,707 64,166,987 Accumulated deficit (59,194,535) (56,758,229) Total stockholders' equity 5,308,569 7,424,502 Total liabilities and stockholders' equity $ 14,533,218 $ 16,343,053