EX-99.1 3 e16270ex99_1.txt PRESS RELEASE Exhibit 99.1 The Gymboree Corporation Reports Third Quarter 2003 Results BURLINGAME, Calif., Nov. 18 /PRNewswire-FirstCall/ -- The Gymboree Corporation (Nasdaq: GYMB) today reported earnings of $0.27 per diluted share for the third fiscal quarter ended November 1, 2003 compared to earnings of $0.21 per diluted share for the same period last year. Net sales from retail operations for the third fiscal quarter ended November 1, 2003 totaled $148.1 million, a 2% increase over the $144.5 million in net sales from retail operations reported for the third fiscal quarter ended November 2, 2002. Comparable store sales for the quarter decreased 3% over the same period last year, making the 2003 year-to-date comparable store sales flat to last year. Total net sales for the third fiscal quarter, including sales from Gymboree Play & Music operations, were $151.0 million, an increase of 2% compared to total net sales of $147.9 million for the third fiscal quarter last year. "Our strategy of maximizing opportunities for the Gymboree brand and prudently growing the Janie and Jack business continues to drive the company's productivity and profitability," said Lisa Harper, The Gymboree Corporation's chairman and chief executive officer. "These efforts enabled us to grow our earnings by 32 percent for the quarter." Business Outlook For November, comparable store sales for retail operations are expected to be flat compared to the prior year. For the fourth fiscal quarter in total, the Company expects comparable store sales to be flat to the prior year. The Company also reaffirmed its fourth fiscal quarter guidance of earnings per diluted share to be in the range of $0.39 to $0.41. For the full fiscal year 2003, the Company now expects earnings per diluted share to be in the range of $0.86 to $0.88. Management Presentation A live broadcast of the discussion of third quarter 2003 earnings results will be available to interested parties at 1:30 p.m. PST (4:30 p.m. EST) on Tuesday, November 18. To listen to the live broadcast over the Internet, please log on to gymboree.com, click on "Our Company" at the bottom of the page, go to "Investor and Media Relations" and then "Conference Calls & Web casts." A replay of the call will be available shortly after the broadcast through midnight EST, November 24, 2003, at 703-925-2533, pass code 6414309, as well as archived on our Web site at the same location as the live Web cast. About The Gymboree Corporation The Gymboree Corporation's specialty retail brands offer unique, high- quality products delivered with personalized customer service. As of November 1, 2003, the Company operated a total of 612 stores: 587 Gymboree(R) retail stores (536 in the United States, 27 in Canada, and 24 in Europe) and 25 Janie and Jack(TM) retail shops in the United States. The Company also operates online stores at gymboree.com and janieandjack.com, and offers directed parent-child developmental play programs at 533 franchised and company- operated centers in the United States and 25 other countries. Forward-Looking Statements The foregoing earnings figures the third fiscal quarter 2003 and third fiscal quarter 2002 are un-audited and subject to quarter-end and year- end adjustment, and could differ materially from those indicated. The foregoing paragraphs contain forward-looking statements relating to The Gymboree Corporation's anticipated sales growth and future financial performance. These are forward looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results could differ materially as a result of a number of factors, including customer reactions to new merchandise and service levels, success in meeting our delivery targets, the level of our promotional activity, our gross margin achievement, our ability to appropriately manage inventory, general economic conditions, and competitive market conditions. Other factors that may cause actual results to differ materially include those set forth in the reports that we file from time to time with the Securities and Exchange Commission. THE GYMBOREE CORPORATION CONDENSED CONSOLIDATED INCOME STATEMENTS (In thousands, except per share and store data) (Unaudited) 13 Weeks Ended 39 Weeks Ended Nov. 1, Nov. 2, Nov. 1, Nov. 2, 2003 2002 2003 2002 Net sales: Retail $148,148 $144,539 * $394,586 $379,229 * Play & music 2,894 3,338 * 9,001 10,497 * Total net sales 151,042 147,877 403,587 389,726 Cost of goods sold, including buying & occupancy expenses (88,708) (87,024)* (241,197) (230,438)* Gross profit 62,334 60,853 162,390 159,288 Selling, general and administrative expenses (48,992) (49,990)* (139,424) (140,612)* Operating income 13,342 10,863 22,966 18,676 Foreign exchange gains (losses) (31) (96) 183 385 Interest income (expense), net 101 (526) 266 (878) Income before income taxes 13,412 10,241 23,415 18,183 Income tax expense (5,097) (3,943) (8,898) (7,000) Net income $8,315 $6,298 $14,517 $11,183 Net income per share: Basic $0.28 $0.22 $0.49 $0.39 Diluted $0.27 $0.21 $0.47 $0.37 Weighted average shares outstanding: Basic 29,687 29,050 29,518 28,930 Diluted 30,837 30,702 30,764 30,583 Number of stores at end of period 612 585 612 585 * Prior year amounts were reclassified to conform to the 2003 presentation. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) November 1, February 1, November 2, 2003 2003 2002 Current Assets Cash and cash equivalents $56,463 $60,628 $38,197 Accounts receivable 8,089 7,506 4,979 Merchandise inventories 81,832 62,561 71,148 Prepaid expenses and deferred taxes 11,736 10,764 10,310 Total current assets 158,120 141,459 124,634 Property and Equipment, net 110,748 106,464 106,829 Lease Rights, Deferred Taxes and Other Assets 6,808 7,213 4,553 Total Assets $275,676 $255,136 $236,016 Current Liabilities Accounts payable $35,185 $27,150 $26,126 Accrued liabilities 31,337 37,570 31,942 Total current liabilities 66,522 64,720 58,068 Long Term Liabilities Deferred rent and other liabilities 21,153 20,998 21,318 Stockholders' Equity 188,001 169,418 156,630 Total Liabilities and Stockholders' Equity $275,676 $255,136 $236,016 SOURCE The Gymboree Corporation -0- 11/18/2003 /CONTACT: Myles McCormick, Investor Relations, +1-650-696-2933, or investor_relations@gymboree.com, or Jenn Bonzagni Marshall, Media Relations, +1-650-373-7637, or media_relations@gymboree.com, both of Gymboree Corporation/ /Web site: http://www.gymboree.com / (GYMB)