EX-99.I 2 ex99-1aug4.txt EX 99.1 For Further Information: EXHIBIT 99.1 Big Dog Holdings, Inc. 121 Gray Avenue Santa Barbara, California 93101 www.bigdogs.com www.walkingcompany.com CONTACT: Laura Russell Investor Information (805) 963-8727, ext. 1360 laurar@bigdogs.com For Immediate Release: July 29, 2005 Big Dog Holdings, Inc. Announces Second Quarter 2005 Financial Results Santa Barbara, California - July 29, 2005...Big Dog Holdings, Inc. (NASDAQ:BDOG; www.bigdogs.com; www.thewalkingcompany.com), a developer and retailer of branded, lifestyle consumer products, today reported the financial results for the second quarter ended June 30, 2005. For the quarter ended June 30, 2005, consolidated net sales were $43,441,000 as compared with $41,044,000 in the second quarter 2004. Our consolidated retail sales increased 6%, primarily due to comparative store sales increase of 7%. Comparative store sales declined 2.5% for the Big Dogs chain and increased 18.3% for the TWC chain. Consolidated gross profit increased to $24,680,000 in the second quarter 2005 as compared with $23,031,000 in the second quarter 2004. The overall increase in consolidated gross profit is the result of increased sales as well as an increase in margin contribution from Big Dog and TWC. Big Dogs' margin contribution for the period increased to 61.7% as compared to last year's margin contribution of 60.5% and the gross margin for the TWC chain increased to 51.8% as compared to 50.5% for 2004. Consolidated operating expenses in the second quarter 2005 were $21,613,000 or 49.8% of sales compared to $20,813,000 or 50.7% in the second quarter 2004. The decrease in such expenses as a percentage of sales is attributable to leveraging these expenses over a larger revenue base. The consolidated fully diluted net income per share for the second quarter 2005 increased to $.18 per share, as compared with a consolidated fully diluted net income per share of $.14 for the second quarter 2004. Andrew Feshbach, Chief Executive Officer, stated, "We are very pleased with the results of our 2nd quarter and improvements over last year and continue to see this trend going into our 3rd quarter for both chains." Other Business: As previously announced, the Company signed a definitive agreement to purchase the assets of Footworks, a division of the privately held shoe retailer, Bianca of Nevada, Inc. for approximately $10 million. Footworks operates a chain of 8 retail stores selling comfort shoes and accessories. This transaction is working toward completion and is expected to close in August. Big Dog Holdings, Inc. consists of Big Dogs and The Walking Company. Big Dogs develops, markets and retails a branded, lifestyle collection of unique, high-quality, popular-priced consumer products, including activewear, casual sportswear, accessories and gifts. The BIG DOGS(R) brand image is one of quality, value and fun. The BIG DOGS(R) brand is designed to appeal to people of all ages and demographics, particularly baby boomers and their kids, big and tall customers, and pet owners. In addition to its 181 retail stores, Big Dogs markets its products through its catalog, licensing and corporate sales accounts and Internet sales. The Walking Company is a leading independent specialty retailer of high-quality, technically designed comfort footwear and accessories that features premium brands such as ECCO, Mephisto, Dansko, Birkenstock and Merrell among many others. These products have particular appeal to one of the largest and most rapidly growing demographics in the nation. The Walking Company operates 77 stores in premium malls across the nation. Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995- With the exception of historical information, the matters discussed in this press release are forward looking statements that involve a number of risks and uncertainties. The actual future sales and other results of the Company could differ significantly from those statements. Further information on the Company's risk factors is contained in the Company's quarterly and annual reports as filed with the Securities and Exchange Commission. BIG DOG HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited) June 30, -------------------------------------------- 2005 2004 -------------------- -------------------- ASSETS CURRENT ASSETS: Cash and cash equivalents $ 594,000 $ 1,525,000 Receivables, net 767,000 229,000 Inventories 44,407,000 41,653,000 Prepaid expenses and other current assets 1,965,000 1,111,000 Deferred income taxes 1,855,000 1,559,000 -------------------- -------------------- Total current assets 49,588,000 46,077,000 PROPERTY AND EQUIPMENT, Net 9,988,000 10,673,000 INTANGIBLE ASSETS, Net 172,000 217,000 DEFERRED INCOME TAXES 1,690,000 1,394,000 OTHER ASSETS 309,000 448,000 -------------------- -------------------- TOTAL $ 61,747,000 $ 58,809,000 ==================== ==================== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Short-term borrowings $ 7,384,000 $ 8,496,000 Current portion of long-term debt 246,000 261,000 Accounts payable 5,006,000 5,055,000 Income taxes payable 72,000 83,000 Accrued expenses and other current liabilities 5,376,000 5,696,000 -------------------- -------------------- Total current liabilities 18,084,000 19,591,000 NOTE PAYABLE 109,000 487,000 CAPITAL LEASE OBLIGATIONS 152,000 351,000 DEFERRED RENT AND LEASE INCENTIVES 1,333,000 690,000 DEFERRED GAIN ON SALE-LEASEBACK 222,000 274,000 -------------------- -------------------- Total liabilities 19,900,000 21,393,000 STOCKHOLDERS' EQUITY 41,847,000 37,416,000 -------------------- -------------------- TOTAL $ 61,747,000 $ 58,809,000 ==================== ====================
BIG DOG HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended Six Months Ended June 30, June 30, ----------------------------------------- --------------------------------------- 2005 2004 2005 2004 ------------------- ----------------- ------------------ ----------------- NET SALES $ 43,441,000 $ 41,043,000 $ 74,786,000 $ 62,924,000 COST OF GOODS SOLD 18,761,000 18,013,000 33,879,000 28,672,000 ------------------- ----------------- ------------------ ----------------- GROSS PROFIT 24,680,000 23,030,000 40,907,000 34,252,000 ------------------- ----------------- ------------------ ----------------- OPERATING EXPENSES: Selling, marketing and distribution 19,327,000 18,875,000 37,594,000 33,008,000 General and administrative 2,286,000 1,936,000 4,029,000 3,733,000 ------------------- ----------------- ------------------ ----------------- Total operating expenses 21,613,000 20,811,000 41,623,000 36,741,000 ------------------- ----------------- ------------------ ----------------- INCOME(LOSS) FROM OPERATIONS 3,067,000 2,219,000 (716,000) (2,489,000) OTHER INCOME - 82,000 - 82,000 INTEREST INCOME 1,000 64,000 41,000 70,000 INTEREST EXPENSE (297,000) (347,000) (448,000) (477,000) ------------------- ----------------- ------------------ ----------------- INCOME(LOSS) BEFORE PROVIS (BENEFIT) FOR INCOME TAXES 2,771,000 2,018,000 (1,123,000) (2,814,000) PROVISION(BENEFIT) FOR INCOME TAXES 1,053,000 767,000 (427,000) (1,069,000) ------------------- ----------------- ------------------ ----------------- NET INCOME (LOSS) $ 1,718,000 $ 1,251,000 $ (696,000) $ (1,745,000) =================== ================= ================== ================= NET INCOME (LOSS) PER SHARE BASIC $ 0.19 $ 0.15 $ (0.08) $ (0.21) =================== ================= ================== ================ DILUTED $ 0.18 $ 0.14 $ (0.08) $ (0.21) =================== ================= ================== ================= WEIGHTED AVERAGE SHARES OUTSTANDING: BASIC 9,182,000 8,261,000 9,181,000 8,252,000 =================== ================= ================== ================= DILUTED 9,756,000 8,907,000 9,181,000 8,252,000 =================== ================= ================== =================