10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED OCTOBER 29, 2016
	OR
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT FOR THE TRANSITION PERIOD FROM ________ TO ________

COMMISSION FILE NUMBER: 0-14818

TRANS WORLD ENTERTAINMENT CORPORATION

(Exact name of registrant as specified in its charter)

New York	14-1541629
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer
	Identification Number)

38 Corporate Circle

Albany, New York 12203

(Address of principal executive offices, including zip code)

(518) 452-1242

(Registrant’s telephone number, including area code)

Indicate by a check mark whether the Registrant (1) has filed all reports required to be filed by Sections 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  x No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o Accelerated filer  x Non-accelerated filer o Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock, $.01 par value,
36,115,388 shares outstanding as of October 29, 2016

TRANS WORLD ENTERTAINMENT CORPORATION AND SUBSIDIARIES
QUARTERLY REPORT ON FORM 10-Q
INDEX TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

	Form 10-Q Page No.
PART I. FINANCIAL INFORMATION
Item 1 – Interim Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets at October 29, 2016, January 30, 2016 and October 31, 2015	3
Condensed Consolidated Statements of Operations – Thirteen and Thirty-nine Weeks Ended October 29, 2016 and October 31, 2015	4
Condensed Consolidated Statements of Comprehensive Loss – Thirteen and Thirty-nine Weeks Ended October 29, 2016 and October 31, 2015	5
Condensed Consolidated Statements of Cash Flows – Thirty-nine Weeks Ended October 29, 2016 and October 31, 2015	6
Notes to Condensed Consolidated Financial Statements	7
Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3 – Quantitative and Qualitative Disclosures about Market Risk	24
Item 4 – Controls and Procedures	24
PART II. OTHER INFORMATION
Item 1 – Legal Proceedings	25
Item 1A- Risk Factors	25
Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds	25
Item 3 – Defaults Upon Senior Securities	25
Item 4 – Mine Safety Disclosures	25
Item 5 – Other Information	25
Item 6 – Exhibits	26
Signatures	27

2

TRANS WORLD ENTERTAINMENT CORPORATION AND SUBSIDIARIES

PART 1. FINANCIAL INFORMATION

Item 1 - Financial Statements

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share and share amounts)

(unaudited)

	October 29,			January 30,			October 31,
	2016			2016			2015
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	4,708		$	104,311		$	74,854
Merchandise inventory		157,827			120,046			149,524
Other current assets		13,903			6,630			12,396
Total current assets		176,438			230,987			236,774
Net fixed assets		41,902			30,665			27,282
Goodwill		39,800			—			—
Net intangible assets		28,737			—			—
Restricted cash		16,100			—			—
Other assets		10,272			9,953			9,081
TOTAL ASSETS	$	313,249		$	271,605		$	273,137
LIABILITIES
CURRENT LIABILITIES:
Accounts payable	$	61,956		$	51,888		$	65,471
Notes payable		5,936			—			—
Accrued expenses and other current liabilities		9,116			8,974			6,763
Deferred revenue		7,813			8,983			8,430
Current portion of capital lease obligations		—			—			143
Total current liabilities		84,821			69,845			80,807
Contingent consideration		10,381			—			—
Other long-term liabilities		28,927			26,492			27,716
TOTAL LIABILITIES		124,129			96,337			108,523
SHAREHOLDERS’ EQUITY
Preferred stock ($0.01 par value; 5,000,000 shares authorized; none issued)		—			—			—
Common stock ($0.01 par value; 200,000,000 shares authorized; 64,252,671, 58,395,668 and 58,345,668 shares issued, respectively)		643			584			583
Additional paid-in capital		337,439			316,040			315,956
Treasury stock at cost (28,137,283, 27,411,133 and 27,270,691, shares, respectively)		(230,144	)		(227,497	)		(227,060	)
Accumulated other comprehensive loss		(658	)		(812	)		(1,950	)
Retained earnings		81,840			86,953			77,085
TOTAL SHAREHOLDERS’ EQUITY		189,120			175,268			164,614
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	313,249		$	271,605		$	273,137

See Accompanying Notes to Condensed Consolidated Financial Statements.

3

TRANS WORLD ENTERTAINMENT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

(unaudited)

	Thirteen Weeks Ended						Thirty-nine Weeks Ended
	October 29,			October 31,			October 29,			October 31,
	2016			2015			2016			2015
Net sales	$	65,039		$	67,925		$	203,127		$	213,339
Other revenue		1,242			1,125			3,232			3,413
Total revenue		66,281			69,050			206,359			216,752
Cost of sales		39,409			41,245			121,960			128,699
Gross profit		26,872			27,805			84,399			88,053
Selling, general and administrative expenses		34,680			31,600			97,415			93,731
Loss from operations		(7,808	)		(3,795	)		(13,016	)		(5,678	)
Interest expense		179			532			523			1,451
Other income		(51	)		(44	)		(1,068	)		(84	)
Loss before income tax expense		(7,936	)		(4,283	)		(12,471	)		(7,045	)
Income tax expense (benefit)		(7,452	)		45			(7,358	)		134
Net loss	$	(484	)	$	(4,328	)	$	(5,113	)	$	(7,179	)
BASIC AND DILUTED LOSS PER SHARE:
Basic and diluted loss per share	$	(0.02	)	$	(0.14	)	$	(0.17	)	$	(0.23	)
Weighted average number of common shares outstanding – basic and diluted		31,434			31,107			30,854			31,140

See Accompanying Notes to Condensed Consolidated Financial Statements.

4

TRANS WORLD ENTERTAINMENT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in thousands)

(unaudited)

	Thirteen Weeks Ended						Thirty-nine Weeks Ended
	October 29,			October 31,			October 29,			October 31,
	2016			2015			2016			2015
Net loss	$	(484	)	$	(4,328	)	$	(5,113	)	$	(7,179	)
Amortization of pension costs		51			77			154			231
Comprehensive loss	$	(433	)	$	(4,251	)	$	(4,959	)	$	(6,948	)

See Accompanying Notes to Condensed Consolidated Financial Statements.

5

TRANS WORLD ENTERTAINMENT CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

	Thirty-nine Weeks Ended
	October 29,			October 31,
	2016			2015
Net cash used by operating activities	$	(30,179	)	$	(26,165	)
Cash flows from investing activities:
Purchases of business, net of cash acquired		(36,300	)		—
Proceeds from sale of investment		1,600			—
Purchase of investments		(500	)		(800	)
Purchases of fixed assets		(16,726	)		(15,293	)
Net cash used by investing activities		(51,926	)		(16,093	)
Cash flows from financing activities:
Proceeds from S-T borrowings		5,936			—
Payment on line of credit		(4,727	)		—
Exercise of stock options		39			19
Payments of capital lease obligations		—			(795	)
Purchase of treasury stock		(2,646	)		(649	)
Net cash used by financing activities		(1,398	)		(1,425	)
Net decrease in cash and cash equivalents		(83,503	)		(43,683	)
Cash, cash equivalents, and restricted cash, beginning of period		104,311			118,537
Cash, cash equivalents, and restricted cash, end of period	$	20,808		$	74,854
Supplemental disclosures:
Cash, cash equivalents, and restricted cash, end of period	$	20,808
Less: restricted cash		(16,100	)
Cash and cash equivalents per Condensed Consolidated Balance Sheet	$	4,708
Fair value of assets acquired, including cash acquired	$	93,754
Liabilities assumed		(24,858	)
Net assets acquired		68,896
Less: Contingent consideration not yet paid		(10,381	)
Less: Fair value of shares issued as consideration		(20,415	)
Less: Cash acquired		(1,800	)
Purchase of business, net of cash acquired	$	36,300
Issuance of equity grants	$	6,074		$	19

See Accompanying Notes to Condensed Consolidated Financial Statements.

6

TRANS WORLD ENTERTAINMENT CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

October 29, 2016 and October 31, 2015

Note 1. Nature of Operations

Trans World Entertainment Corporation and subsidiaries (“the Company”) is a specialty retailer of entertainment products, including video, trend, music, electronics and related products in the United States. The Company operates a chain of retail entertainment stores, primarily under the names f.y.e. for your entertainment and Suncoast Motion Pictures, and e-commerce sites, www.fye.com, and www.secondspin.com in a single industry segment. As of October 29, 2016, the Company operated 294 stores totaling approximately 1.7 million square feet in the United States, the District of Columbia and the Commonwealth of Puerto Rico.

On October 17, 2016, the Company acquired all of the issued and outstanding capital stock of etailz, Inc. (“etailz”), an innovative and leading digital marketplace retail expert. See Note 6 to the Condensed Consolidated Financial Statements for additional information.

Liquidity and Cash Flows:

The Company’s primary sources of working capital are cash and cash equivalents on hand, cash provided by operations and borrowing capacity under its revolving credit facility (See Note 9 for further details). The Company’s cash flows fluctuate from quarter to quarter due to various items, including seasonality of sales and earnings, merchandise inventory purchases and returns and the related terms on the purchases and capital expenditures. Management believes it will have adequate resources to fund its cash needs for the next twelve months and beyond, including its capital spending, seasonal increase in merchandise inventory and other operating cash requirements and commitments.

Management anticipates that any future cash requirements due to a shortfall in cash from operations would be funded by the Company’s cash and cash equivalents on hand and its revolving credit facility.

Seasonality:

The Company’s business is seasonal, with the fourth fiscal quarter constituting the Company’s peak selling period. In fiscal 2015, the fourth quarter accounted for approximately 35% of annual net sales and all of net income. In anticipation of increased sales activity in the fourth quarter, the Company purchases additional inventory and hires seasonal associates to supplement its core store sales and distribution center staffs. If, for any reason, the Company’s sales were below seasonal norms during the fourth quarter, the Company’s operating results could be adversely affected. Quarterly sales can also be affected by the timing of new product releases, new store openings, store closings and the performance of existing stores.

Note 2: Basis of Presentation

The accompanying unaudited condensed consolidated financial statements consist of Trans World Entertainment Corporation, its wholly-owned subsidiary, Record Town, Inc. (“Record Town”), Record Town’s subsidiaries and etailz, Inc., all of which are wholly-owned. All significant intercompany accounts and transactions have been eliminated.

The interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. The information furnished in these unaudited condensed consolidated financial statements reflects all normal, recurring adjustments which, in the opinion of management, are necessary for the fair presentation of such financial statements. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to rules and regulations applicable to interim financial statements.

7

During the thirty-nine weeks ended October 29, 2016, the Company recorded an immaterial adjustment between Other Revenue and Selling, General and Administrative expenses in its prior year condensed consolidated financial statements for miscellaneous income, primarily related to commissions earned from third parties. The immaterial adjustment did not impact prior year loss from operations, net loss, and basic and diluted loss per share. With the adjustment, the prior year presentation is consistent with the current year presentation.

The information presented in the accompanying unaudited condensed consolidated balance sheet as of January 30, 2016 has been derived from the Company’s January 30, 2016 audited consolidated financial statements. All other information has been derived from the Company’s unaudited condensed consolidated financial statements as of and for the thirty-nine weeks ended October 29, 2016 and October 31, 2015. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 30, 2016.

The Company’s significant accounting policies are the same as those described in Note 1 to the Company’s Consolidated Financial Statements on Form 10-K for the fiscal year ended January 30, 2016. Except as described herein, there has been no material change to the accounting policies applied to our consolidated results and footnote disclosures. In accordance with the accounting guidance for business combinations, we use the acquisition method of accounting to allocate costs of acquired businesses to the assets acquired and liabilities assumed based on their estimated fair values at the dates of acquisition. The excess costs of acquired businesses over the fair values of the assets acquired and liabilities assumed are recognized as goodwill. The valuations of acquired assets and liabilities will impact the determination of future operating results. In addition to using management estimates and negotiated amounts, we use a variety of information sources to determine the estimated fair values of the assets and liabilities, including third-party appraisals for the estimated value and lives of identifiable intangible assets and property and equipment. The business and technical judgment of management is used in determining the useful lives of finite-lived intangible assets in accordance with the accounting guidance for goodwill and intangible assets.

Note 3. Recently Issued Accounting Pronouncements

In 2014, the FASB issued Accounting Standard Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The new standard is effective for the Company’s fiscal year beginning January 28, 2018. Early application is permitted. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the standard on its ongoing financial reporting.

In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory. The amendments, which apply to inventory that is measured using any method other than the last-in, first-out (LIFO) or retail inventory method, require that entities measure inventory at the lower of cost or net realizable value. ASU 2015-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016 and should be applied on a prospective basis. We are currently assessing the potential impact of adopting this ASU, but do not, at this time, anticipate a material impact to our consolidated results of operations, financial positions or cash flows.

8

In February 2016, the FASB issued ASU No. 2016-02, Leases, which will replace most existing lease accounting guidance in U.S. GAAP. The core principle of the ASU is that an entity should recognize the rights and obligations resulting from leases as assets and liabilities. The new standard requires qualitative and specific quantitative disclosures to supplement the amounts recorded in the financial statements so that users can understand more about the nature of an entity’s leasing activities, including significant judgments and changes in judgments. The new standard will be effective for the Company’s fiscal year beginning February 3, 2019, and requires the modified retrospective method of adoption. Early adoption is permitted. The Company is in the process of determining the method and timing of adoption and assessing the impact of ASU 2016-02 on its consolidated financial statements.

In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows, which require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The Company adopted this standard as part of its quarterly report for the period ended October 29, 2016.

Note 4. Stock Based Compensation

As of October 29, 2016, there was approximately $0.9 million of unrecognized compensation cost related to stock awards that is expected to be recognized as expense over a weighted average period of 2.8 years.

As of October 29, 2016, stock awards authorized for issuance under the Company’s current long term equity incentive plans totaled 8.0 million. There are certain authorized stock plans for which the Company no longer grants awards. Of these awards authorized for issuance, 2.6 million were granted and are outstanding, 1.3 million of which were vested and exercisable. Awards available for future grants at October 29, 2016 were 1.2 million.

The table below outlines the assumptions that the Company used to estimate the fair value of stock options granted during the thirty-nine weeks ended October 29, 2016:

Dividend yield	0%
Expected stock price volatility	38.0%-47.5%
Risk-free interest rate	1.06%-1.56%
Expected award life (in years)	4.92-6.98
Weighted average fair value per share of options granted during the period	$1.19

9

The following table summarizes stock award activity during the thirty-nine weeks ended October 29, 2016:

	Employee and Director Stock Award Plans
	Number of Shares Subject To Option			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term		Other Share Awards (1)			Weighted Average Grant Fair Value
Balance January 30, 2016		2,111,825		$	4.04		5.00		211,174		$	3.79
Granted		909,664			3.74		9.80		68,097			3.84
Canceled		(636,425	)		5.25		—		—			—
Exercised		(18,000	)		2.09		—		(108,344	)		3.68
Balance October 29, 2016		2,367,064		$	3.61		7.44		170,927		$	3.87
Exercisable October 29, 2016		1,154,189		$	3.51		5.88		63,427		$	4.50

(1) Other Share Awards include deferred shares granted to Directors and restricted share units granted to executive officers.

As of October 29, 2016, the intrinsic value of stock awards outstanding was approximately $958,000 and exercisable was $736,000.

In connection with the acquisition of etailz, the Company issued 1,572,552 restricted shares of Company stock to a key etailz employee, with a grant date fair value of $3.56 per share. These shares vest ratably through January 2019. As of October 29, 2016, the Company recognized $207,000 of compensation cost related to these shares. As of October 29, 2016, there was approximately $5.4 million of unrecognized compensation cost related to these restricted shares that is expected to be recognized as expense over a weighted average period of 2.3 years.

Note 5. Defined Benefit Plans

The Company maintains a non-qualified Supplemental Executive Retirement Plan (“SERP”) for certain executive officers of the Company. The SERP provides eligible executives defined pension benefits that supplement benefits under other retirement arrangements. During the thirty-nine weeks ended October 29, 2016, the Company did not make any cash contributions to the SERP and presently expects to pay approximately $1.1 million in benefits relating to the SERP during fiscal 2016.

The measurement date for the SERP is the fiscal year end, using actuarial techniques which reflect estimates for mortality, turnover and expected retirement. In addition, management makes assumptions concerning future salary increases. Discount rates are generally established as of the measurement date using theoretical bond models that select high-grade corporate bonds with maturities or coupons that correlate to the expected payouts of the applicable liabilities.

10

The following represents the components of the net periodic pension cost related to the Company’s SERP for the respective periods:

	Thirteen Weeks Ended						Thirty-nine Weeks Ended
	October 29,			October 31,			October 29,			October 31,
	2016			2015			2016			2015
	(in thousands)						(in thousands)
Service cost	$	15		$	17		$	45		$	51
Interest cost		137			145			411			435
Amortization of pension costs		55			86			166			258
Amortization of net gain(1)		(4	)		(9	)		(12	)		(27	)
Net periodic pension cost	$	203		$	239		$	610		$	717

(1) The amortization of net gain is related to a director retirement plan previously provided by the Company.

Note 6. Business Combinations

On October 17, 2016, the Company completed the purchase of all of the issued and outstanding shares of etailz, Inc. (“etailz”), an innovative and leading digital marketplace retail expert. The Company paid $38.1 million in cash and issued 5.7 million shares of TWMC stock at closing to the shareholders of etailz as consideration for their shares. Based on the fair value of $3.56 per share on the acquisition date, the shares had a value of $20.4 million. An earn-out of up to a maximum of $14.6 million will be payable in fiscal 2018 and fiscal 2019 subject to the achievement by etailz of $6 million in operating income in fiscal 2017 and $7.5 million in fiscal 2018. In connection with the acquisition, The Company assumed the liability for etailz’s employee retention bonus plan, of which $1.9 million was due and payable at closing and the remaining $2.3 million will be earned over a two year service period. The acquisition and related costs were funded primarily from the Company’s cash on hand and short term borrowings under its revolving credit facility. The acquisition was accounted for using the purchase method of accounting. As of the date of filing this quarterly report on Form 10-Q, the preliminary purchase accounting has not yet been finalized due primarily to the proximity of the closing date of the transaction to the filing date of this quarterly report and the pending receipt of the final valuation for certain assets, including identifiable intangible assets.

The acquisition date fair value of the consideration for the above transaction consisted of the following as of October 17, 2016 (in thousands):

Cash consideration	$	38,100
Fair value of stock consideration		20,415
Fair value of contingent consideration		10,381
Fair value of purchase consideration	$	68,896

The excess of purchase consideration paid over the fair value of identifiable intangible assets acquired was recorded as goodwill. The goodwill recognized is not deductible for income tax purposes.

11

The following table summarizes the preliminary allocation of the aggregate purchase price to the estimated fair value of the net assets acquired:

	($ in thousands)
	October 17, 2016
Assets Acquired
Cash and Cash Equivalents	$	1,800
Accounts receivable		1,533
Prepaid expenses and other current assets		6,603
Inventory		14,669
Property and equipment, net		649
Other long term-assets		12
Acquired intangible assets:
Trade names		3,200
Technology		6,700
Vendor relationships		19,000
Unfavorable lease valuation		(125	)
Goodwill		39,800
Total assets acquired	$	93,841
Liabilities Assumed
Accounts payable	$	4,227
Debt		5,289
Other current liabilities		7,927
Deferred taxes		7,502
Total liabilities assumed	$	24,945
Net assets acquired	$	68,896

The Company recognized total acquisition related costs of $2.2 million for the thirteen and thirty-nine weeks ended October 29, 2016. These costs are included in selling, general and administrative expenses in the Company’s condensed consolidated statements of operations.

The results of operations of etailz will be reported in the Company’s etailz segment and has been included in the consolidated results of operations of the Company from the date of acquisition. The following unaudited pro forma financial information for the thirteen weeks and thirty-nine weeks ended October 29, 2016, and October 31, 2015, presents consolidated information as if the etailz acquisition had occurred on February 1, 2015. Because of different fiscal period ends, and in order to present results for comparable periods, the unaudited pro forma financial information for the thirty-nine weeks ended October 29, 2016, combines (i) the Company’s historical statement of operations for the thirty-nine weeks ended October 29, 2016, and (ii) etailz historical statement of income for the period from January 1, 2016 through August 31, 2016 and October 1, 2016 through October 16, 2016. The unaudited pro forma financial information for the thirteen weeks ended October 29, 2016, combines (i) the Company’s historical statement of operations for the thirteen weeks ended October 29, 2016; and (ii) etailz historical statement of income for the period from July 1, 2016 through August 31, 2016 and October 1, 2016 through October 16, 2016. The unaudited pro forma financial information for the thirty-nine weeks and thirteen weeks ended October 31, 2015, combines (i) the Company’s historical statement of operations for the thirty-nine weeks and thirteen weeks ended October 31, 2015, and (ii) etailz historical statement of income for the nine months and three months ended October 31, 2015. The unaudited pro forma financial information is presented after giving effect to certain adjustments for acquisition-related costs, depreciation, amortization of definite lived intangible assets, interest expense on acquisition financing, and related income tax effects. The unaudited pro forma financial information is based upon currently available information and upon certain assumptions that the Company believes are reasonable under the circumstances. The unaudited pro forma financial information does not purport to present what the Company’s results of operations would actually have been if the aforementioned transaction had in fact occurred on such date or at the beginning of the period indicated, nor does it project the Company’s financial position or results of operations at any future date or for any future period.

12

	Thirteen Weeks Ended						Thirty-nine Weeks Ended
	October 29,			October 31,			October 29,			October 31,
	2016			2015			2016			2015
Pro forma total revenue	$	90,655		$	90,942		$	287,060		$	278,862
Pro forma net loss		(6,945	)		(5,441	)		(13,513	)		(10,074	)
Pro forma basic and diluted loss per share	$	(0.19	)	$	(0.15	)	$	(0.37	)	$	(0.27	)
Pro forma weighted average number of common shares outstanding – basic and diluted		36,157			36,838			36,257			36,871

Note 7. Identifiable Intangible Assets

Identifiable intangible assets as of October 29, 2016 consisted of the following (in thousands, except weighted-average amortization period):

	October 29, 2016
	Weighted Average Amortization Period (in months)		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Vendor Relationships		120	$	19,000	$	61	$	18,939
Technology		60		6,711		87		6,624
Trade names and trademarks		60		3,200		26		3,174
			$	28,911	$	174	$	28,737

Estimated amortization expense for the remaining three months of fiscal 2016 and each of the five succeeding fiscal years and thereafter is as follows:

Year	Amortization
($ in thousands)
2016	$	1,094
2017		3,880
2018		3,880
2019		3,880
2020		3,880
2021		3,220
Thereafter	$	8,903

Note 8. Restricted Cash

In connection with the acquisition of etailz, Inc. and under the terms of the share purchase agreement, the Company was required to hold certain cash in escrow. At October 29, 2016, the Company had restricted cash of $16.1 million reported in long-term assets on the consolidated balance sheet. The Company designated $1.5 million of the restricted cash to be made available to satisfy any indemnification claims and $14.6 million of the restricted cash to equal the maximum earn-out amount that could be paid to the selling shareholders of etailz, Inc. in accordance with the share purchase agreement.

13

A summary of cash, cash equivalents and restricted cash is as follows ($ in thousands):

	October 29,		January 30,
	2016		2016
Cash and cash equivalents	$	4,708	$	104,311
Restricted cash		16,100		—
Total cash, cash equivalents and restricted cash	$	20,808	$	104,311

Note 9. Line of Credit

In May 2012, the Company entered into a $75 million credit facility (“Credit Facility”) which amended the previous credit facility. The principal amount of all outstanding loans under the Credit Facility together with any accrued but unpaid interest, are due and payable in May 2017, unless otherwise paid earlier pursuant to the terms of the Credit Facility. The Company currently expects to review its Credit Facility prior to the expiration date. Payments of amounts due under the Credit Facility are secured by the assets of the Company.

The Credit Facility includes customary provisions, including affirmative and negative covenants, which include representations, warranties and restrictions on additional indebtedness and acquisitions. The Credit Facility also includes customary events of default, including, among other things, material adverse effect, bankruptcy, and certain changes of control. The Credit Facility also contains other terms and conditions, including limitations on the payment of dividends and covenants around the net number of store closings. The Company is compliant with all covenants.

Interest under the Credit Facility will accrue, at the election of the Company, at a Base Rate or LIBO Rate, plus, in each case, an Applicable Margin, which is determined by reference to the level of availability, with the Applicable Margin for LIBO Rate loans ranging from 2.25% to 2.75% and the Applicable Margin for Prime Rate loans ranging from 0.75% to 1.25%. In addition, a commitment fee ranging from 0.375% to 0.50% is also payable on unused commitments. The availability under the Credit Facility is subject to limitations based on inventory levels.

As of October 29, 2016, the Company had $5.9 million in outstanding borrowings under the revolving credit facility and $53.7 million was available for borrowing. The weighted average interest rate on outstanding borrowings for the thirteen week period ended October 29, 2016 was 3.73%. As of October 31, 2015, there were no borrowings outstanding under lines of credit and $65.0 million was available for borrowings.

During the thirteen weeks ended October 29, 2016 , in connection with the acquisition of etailz, the Company paid off etailz’s outstanding letter of credit in the amount of $4.7 million, as the Company assumed this liability and paid off immediately following the acquisition.

Note 10. Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss that the Company reports in the condensed consolidated balance sheets represents net loss, adjusted for the difference between the accrued pension liability and accrued benefit cost, net of taxes, associated with the Company’s defined benefit plans. Comprehensive loss consists of net loss and the reclassification of pension costs previously reported in comprehensive loss for the thirteen and thirty-nine weeks ended October 29, 2016 and October 31, 2015.

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Note 11. Depreciation and Amortization of Fixed Assets and Intangible Assets

Depreciation and amortization of fixed assets included in the condensed consolidated statements of operations is as follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
	October 29,		October 31,		October 29,		October 31,
	2016		2015		2016		2015
	(in thousands)				(in thousands)
Cost of sales	$	104	$	124	$	301	$	370
Selling, general and administrative expenses		2,222		1,227		5,309		3,238
Total	$	2,326	$	1,351	$	5,610	$	3,608

Note 12. Basic and Diluted Loss Per Share

Basic loss per share is calculated by dividing net loss by the weighted average common shares outstanding for the period. Diluted Loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock (net of any assumed repurchases) that then shared in the earnings of the Company, if any. It is computed by dividing net loss by the sum of the weighted average shares outstanding and additional common shares that would have been outstanding if the dilutive potential common shares had been issued for the Company’s common stock awards from the Company’s Stock Award Plans.

For the thirteen and thirty-nine week periods ended October 29, 2016 and October 31, 2015, the impact of all outstanding stock awards was not considered because the Company reported a net loss and such impact would be anti-dilutive. Accordingly, basic and diluted loss per share is the same.

Total anti-dilutive stock awards for the thirteen and thirty-nine week periods ended October 29, 2016 were approximately 1.9 million shares and 1.8 million shares, respectively, as compared to 1.8 million shares and 1.7 million shares, respectively, for the thirteen and thirty-nine weeks ended October 31, 2015.

Note 13. Shareholders’ Equity

In connection with the acquisition of etailz, in October 2016, the Company issued 5.7 million shares of Company common stock to the selling shareholders of etailz at fair value of $3.56 per share.

During the thirty-nine week period ended October 29, 2016, the Company repurchased 686,137 shares of common stock at an average price of $3.87 per share. Since the inception of the program, the Company has repurchased 2,558,180 shares of common stock at an average price of $3.83 per share. The Company has approximately $12.2 million available for future purchases under its repurchase program.

The Company classifies the repurchased shares as treasury stock on the Company’s condensed consolidated balance sheet.

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Note 14. Income Taxes

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent on the generation of future taxable income. Management considers the scheduled reversal of taxable temporary differences, projected future taxable income and tax planning strategies in making this assessment. Based on available objective evidence, management concluded that a full valuation allowance should continue to be recorded against the Company's deferred tax assets. Management will continue to assess the need for and amount of the valuation allowance against the deferred tax assets by giving consideration to all available evidence to the Company’s ability to generate future taxable income in its conclusion of the need for a full valuation allowance. Any reversal of the Company’s valuation allowance will favorably impact its results of operations in the period of reversal. The Company is currently unable to determine whether or when that reversal might occur, but it will continue to assess the realizability of its deferred tax assets and will adjust the valuation allowance if it is more likely than not that all or a portion of the deferred tax assets will become realizable in the future. The Company has significant net operating loss carry forwards and other tax attributes that are available to offset projected taxable income and current taxes payable, if any, for the year ending January 28, 2017.  The deferred tax impact resulting from the utilization of the net operating loss carry forwards and other tax attributes will be offset by a reduction in the valuation allowance. As of January 30, 2016, the Company had a net operating loss carry forward of $158.8 million for federal income tax purposes and approximately $247 million for state income tax purposes that expire at various times through 2035 and are subject to certain limitations and statutory expiration periods.

During the third quarter of fiscal 2016, in connection with the acquisition of etailz, the Company recognized a tax benefit of $7.5 million related to the reduction of its valuation allowance equivalent to the net deferred tax liabilities recorded on the etailz opening balance sheet. In assessing the realizability of the net deferred tax assets at the time of the acquisition of etailz, management considered whether it is more likely than not that some portion or all of the remaining deferred tax assets will not be realizable. Management considered the scheduled reversal of taxable temporary differences, projected future taxable income when combining Trans World Entertainment projected income or loss with etailz projected income or loss, and tax planning strategies when making this assessment. Based on the available objective evidence, management concluded that a full valuation allowance should be recorded against its deferred tax assets net of the deferred tax liabilities recorded in connection with the etailz acquisition.

16

TRANS WORLD ENTERTAINMENT CORPORATION AND SUBSIDIARIES

PART 1. FINANCIAL INFORMATION

Item 2 - Management’s Discussion and Analysis of Financial Condition and

Results of Operations

October 29, 2016 and October 31, 2015

Overview

Management’s Discussion and Analysis of Financial Condition and Results of Operations provides information that the Company’s management believes necessary to achieve an understanding of its financial statements and results of operations. To the extent that such analysis contains statements which are not of a historical nature, such statements are forward-looking statements, which involve risks and uncertainties. These risks include, but are not limited to, changes in the competitive environment for the Company’s merchandise, including the entry or exit of non-traditional retailers of the Company’s merchandise to or from its markets; releases by the music and video industries of an increased or decreased number of “hit releases”, general economic factors in markets where the Company’s merchandise is sold; and other factors discussed in the Company’s filings with the Securities and Exchange Commission. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements and related notes included elsewhere in this report and the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 30, 2016.

During October 2016, the Company acquired all of the issued and outstanding capital stock of etailz, Inc. (“etailz”), an innovative and leading digital marketplace retail expert. See Note 6 to the Condensed Consolidated Financial Statements for additional information. Subsequent to this acquisition, reportable segments consist of FYE and etailz. As of October 29, 2016, FYE operated 294 stores totaling approximately 1.7 million square feet in the United States, the District of Columbia and the Commonwealth of Puerto Rico. FYE stores offer predominantly entertainment products, including video and music. In total, these two categories represented 61% of the Company’s net sales for the thirty-nine weeks ended October 29, 2016. The balance of categories, including trend, electronics, video games and related products represented 39% of the FYE’s net sales for the thirty-nine weeks ended October 29, 2016.

The Company’s results have been, and will continue to be, contingent upon management’s ability to understand industry trends and to manage the business in response to those trends and general economic trends. Management monitors a number of key performance indicators to evaluate its performance, including:

Net sales and comparable store net sales: The Company measures and reports the rate of change in comparable store net sales. A store is included in comparable store net sales calculations at the beginning of its thirteenth full month of operation. Stores relocated/expanded or downsized are excluded from comparable store net sales if the change in square footage is greater than 20%. Closed stores that were open for at least thirteen months are included in comparable stores net sales through the month immediately preceding the month of closing. Stores that are temporarily closed are excluded from the calculation of comparable stores sales for the applicable periods in the year of closure and the subsequent year. The Company further analyzes net sales by store format and by product category.

Cost of Sales and Gross Profit: Gross profit is impacted primarily by the mix of products sold, by discounts negotiated with vendors, and discounts offered to customers. The Company records its distribution and product shrink expenses in cost of sales. Distribution expenses include those costs associated with receiving, shipping, inspecting and warehousing product and costs associated with product returns to vendors. Cost of sales further includes obsolescence costs and is reduced by the benefit of vendor allowances, net of direct reimbursements of expense.

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Selling, General and Administrative (“SG&A”) Expenses: Included in SG&A expenses are payroll and related costs, occupancy charges, general operating and overhead expenses and depreciation charges (excluding those related to distribution operations, as disclosed in Note 11 to the condensed consolidated financial statements). Selling, general and administrative expenses also include fixed asset write offs associated with store closures and change in square footage, if any, gift card breakage and acquisition costs.

Balance Sheet and Ratios: The Company views cash, net inventory investment (merchandise inventory less accounts payable) and working capital (current assets less current liabilities) as relevant indicators of its financial position. See Liquidity and Capital Resources for further discussion of these items.

RESULTS OF OPERATIONS

Thirteen and Thirty-nine Weeks Ended October 29, 2016

Compared to the Thirteen and Thirty-nine Weeks Ended October 31, 2015

Results for etailz are included in our financial statements beginning October 17, 2016, the date of the closing of the acquisition (“Post Acquisition Period”).

Net Sales. The following table sets forth a period over period comparison of the Company’s net sales by category:

	Thirteen Weeks Ended															Thirty-nine Weeks Ended
	October 29, 2016			October 31, 2015			Change			%			Comp Store Net Sales			October 29, 2016			October 31, 2015			Change			%			Comp Store Net Sales
	(in thousands, except store data)															(in thousands, except store data)
FYE net sales	$	61,215		$	67,925		$	(6,710	)		-9.9	%		-4.6	%	$	199,303		$	213,339		$	(14,036	)		-6.6	%		-1.7	%
Etailz net sales		3,824			—		$	3,824			n/a						3,824			—		$	3,824			n/a
Other revenue		1,242		$	1,125			117			10.4	%					3,232			3,413			(181	)		-5.3	%
Total revenue	$	66,281		$	69,050		$	(2,769	)		-4.0	%				$	206,359		$	216,752		$	(10,393	)		-4.8	%
As a % of FYE net sales
Video		35.2	%		40.6	%								-16.2	%		37.3	%		42.9	%								-13.4	%
Trend		32.3	%		22.8	%								26.7	%		28.6	%		18.5	%								41.9	%
Music		21.7	%		25.3	%								-18.3	%		23.8	%		26.6	%								-12.6	%
Electronics		10.1	%		9.2	%								8.0	%		9.4	%		9.4	%								0.9	%
Video Games		0.7	%		2.1	%								-60.3	%		0.9	%		2.6	%								-57.3	%
Store Count:																	294			309			(15	)		-4.9	%
Total Square footage																	1,649			1,793			(144	)		-8.0	%

FYE

FYE comparable sales decreased 4.6% for the thirteen weeks ended October 29, 2016. For the thirty-nine weeks ended October 29, 2016, comparable sales decreased 1.7%. Net sales decreased 9.9% and 6.6% during the thirteen weeks and thirty-nine weeks ended October 29, 2016 as compared to the same periods last year. The decline in net sales resulted primarily from a decrease in store count of 4.9% from October 31, 2015 to October 29, 2016.

etailz

etailz reported $3.8 million sales for the period from October 17, 2016 to October 29, 2016.

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Gross Profit. The following table sets forth a period over period comparison of the Company’s gross profit:

	Thirteen Weeks ended											Thirty-nine Weeks Ended
							Change											Change
	October 29, 2016			October 31, 2015			$			%		October 29, 2016			October 31, 2015			$			%
		(in thousands)											(in thousands)
FYE gross profit	$	25,932		$	27,805		($	1,873	)	-6.7	%	$	83,459		$	88,053		($	4,594	)		-5.2	%
etailz gross profit		940			—			940		n/a			940			—			940			n/a
Total gross profit	$	26,872		$	27,805		$	(933	)	-3.4	%	$	84,399		$	88,053		($	3,654	)		-4.1	%
FYE gross profit as a % of FYE revenue		40.3	%		39.3	%							40.3	%		39.7	%
Total gross profit as a % of total revenue		40.5	%		40.3	%							40.9	%		40.6	%

FYE

Total gross profit as a percentage of total revenue was 40.5% and 40.9% for the thirteen and thirty-nine weeks ended October 29, 2016, respectively. Gross profit as a percentage of revenue excluding the impact of etailz was 41.5% for the thirteen weeks ended October 29, 2016, compared to 40.3% for the same period last year, a 120 basis point increase. The increase in gross profit as a percentage of sales during the thirty-nine weeks ended October 29, 2016 was due to a shift in mix to higher margin categories as well as improved margins in the trend, electronics, and video categories through improved inventory control and better price management.

etailz

etailz contributed $940 thousand in gross profit, or 24.6% of etailz revenue, from October 17, 2016 to October 29, 2016.

SG&A Expenses. The following table sets forth a period over period comparison of the Company’s SG&A expenses:

		Thirteen Weeks ended												Thirty-nine Weeks Ended
							Change												Change
	October 29, 2016			October 31, 2015			$			%			October 29, 2016			October 31, 2015			$			%
		(in thousands)												(in thousands)
FYE SG&A before depreciation and other one-time charges	$	29,270		$	30,373		($	1,103	)		-3.6	%	$	88,919		$	90,493		($	1,574	)		-1.7	%
As a % of total FYE revenue		46.9	%		44.0	%					2.9	%		43.9	%		41.7	%					2.2	%
Depreciation and amortization		2,214			1,227			987			80.4	%		5,301			3,238			2,062			63.7	%
etailz acquisition transaction costs		2,228			—			2,228			n/a			2,228			—			2,228			n/a
etailz SG&A		967			—			967			n/a			967			—			967			n/a
Total SG&A	$	34,680		$	31,600		$	3,080			9.7	%	$	97,415		$	93,731		$	3,684			3.9	%
As a % of total revenue		52.3	%		45.8	%								47.2	%		43.2	%

For the thirteen weeks ended October 29, 2016, SG&A expenses, before depreciation and acquisition related costs, decreased $1.1 million, or 3.6%, for the quarter to $29.3 million, or 46.9% of revenue, compared to $30.4 million, or 44.0% of revenue, for the same period last year.

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For the thirty-nine weeks ended October 29, 2016, SG&A expenses, before depreciation and acquisition related costs, decreased $1.6 million dollars, or 1.7% to $88.9 million, or 43.9% of total FYE revenue, compared to $90.5 million, or 41.7% of total FYE revenue, in the comparable period last year.

Interest Expense, Net. For the thirteen weeks ended October 29, 2016, net interest expense was $128 thousand versus $488 thousand last year. The decline in interest expense was due to the expiration of the capital lease on the Company’s distribution center and corporate offices. The current lease is accounted for as an operating lease with payments in the amount of $310 thousand included in SG&A.

For the thirty-nine weeks ended October 29, 2016, net interest expense was $523 thousand versus $1.5 million last year. The decline in interest expense was due to the expiration of the capital lease on the Company’s distribution center and corporate offices. The current lease is accounted for as an operating lease with payments in the amount of $929 thousand included in SG&A.

Income Tax Expense.  In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent on the generation of future taxable income. Management considers the scheduled reversal of taxable temporary differences, projected future taxable income and tax planning strategies in making this assessment. Based on available objective evidence, management concluded that a full valuation allowance should continue to be recorded against the Company's deferred tax assets. Management will continue to assess the need for and amount of the valuation allowance against the deferred tax assets by giving consideration to all available evidence to the Company’s ability to generate future taxable income in its conclusion of the need for a full valuation allowance. Any reversal of the Company’s valuation allowance will favorably impact its results of operations in the period of reversal. The Company is currently unable to determine whether or when that reversal might occur, but it will continue to assess the realizability of its deferred tax assets and will adjust the valuation allowance if it is more likely than not that all or a portion of the deferred tax assets will become realizable in the future. The Company has significant net operating loss carry forwards and other tax attributes that are available to offset projected taxable income and current taxes payable, if any, for the year ending January 28, 2017.  The deferred tax impact resulting from the utilization of the net operating loss carry forwards and other tax attributes will be offset by a reduction in the valuation allowance. As of January 30, 2016, the Company had a net operating loss carry forward of $158.8 million for federal income tax purposes and approximately $247 million for state income tax purposes that expire at various times through 2035 and are subject to certain limitations and statutory expiration periods.

During the third quarter of fiscal 2016, in connection with the acquisition of etailz, the Company recognized a tax benefit of $7.5 million related to the reduction of its valuation allowance equivalent to the net deferred tax liabilities recorded on the etailz opening balance sheet.  In assessing the realizability of the net deferred tax assets at the time of the acquisition of etailz, management considered whether it is more likely than not that some portion or all of the remaining deferred tax assets will not be realizable. Management considered the scheduled reversal of taxable temporary differences, projected future taxable income when combining Trans World Entertainment projected income or loss with etailz projected income or loss, and tax planning strategies when making this assessment. Based on the available objective evidence, management concluded that a full valuation allowance should be recorded against its deferred tax assets net of the deferred tax liabilities recorded in connection with the etailz acquisition.

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Net Loss: The following table sets forth a period over period comparison of the Company’s net loss:

		Thirteen Weeks ended									Thirty-nine Weeks Ended
							Change									Change
	October 29, 2016			October 31, 2015				$		October 29, 2016			October 31, 2015			$
		(in thousands)									(in thousands)
Loss before income tax	$	(7,936	)	$	(4,283	)	$	(3,653	)	$	(12,471	)	$	(7,045	)	$	(5,426	)
Income tax expense (benefit)		(7,452	)		45			(7,497	)		(7,358	)		134			(7,492	)
Net loss	$	(484	)	$	(4,328	)	$	3,844		$	(5,113	)	$	(7,179	)	$	2,066

For the thirteen weeks ended October 29, 2016, the Company’s net loss was $484 thousand compared to a net loss of $4.3 million for the thirteen weeks ended October 31, 2015. The decrease in net loss was primarily due to the income tax benefit recorded in the third quarter of 2016 offset by transaction and other costs related to the acquisition of etailz. For the thirty-nine weeks ended October 29, 2016, the Company’s net loss was $5.1 million, compared to a net loss of $7.2 million for the thirty-nine weeks ended October 31, 2015.

LIQUIDITY

Liquidity and Cash Flows: The Company’s primary sources of working capital are cash and cash equivalents on hand, cash provided by operations and borrowing capacity under its revolving credit facility (See Note 6 to the condensed consolidated financial statements for further details). The Company’s cash flows fluctuate from quarter to quarter due to various items, including seasonality of net sales and earnings, merchandise inventory purchases and returns and the related terms on the purchases and capital expenditures. Management believes it will have adequate resources to fund its cash needs for the next twelve months and beyond, including its capital spending, its seasonal increase in merchandise inventory and other operating cash requirements and commitments.

Management anticipates that any future cash requirements due to a shortfall in cash from operations would be funded by the Company’s cash and cash equivalents on hand and its revolving credit facility, discussed hereafter.

The following table sets forth a summary of key components of cash flow and working capital for each of the thirty-nine weeks ended October 29, 2016 and October 31, 2015, or at those dates:

	As of or for the Thirty-nine Weeks Ended				Change
(in thousands)	October 29, 2016		October 31, 2015		$
Operating Cash Flows	(30,179	)	(26,165	)	(6,038	)
Investing Cash Flows	(51,926	)	(16,093	)	(33,806	)
Financing Cash Flows	(1,398	)	(1,425	)	24
Capital Expenditures	(16,726	)	(15,293	)	(1,306	)
Purchases of business, net of cash aquired	(36,300	)	—		(34,400	)
Cash, cash equivalents, and restricted cash	20,808		74,854		(54,046	)
Merchandise Inventory	157,827		149,524		8,303
Working Capital	91,617		155,967		(64,350	)

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The Company had cash, cash equivalents, and restricted cash of $20.8 million at October 29, 2016, compared to $74.9 million at October 31, 2015.

Cash used by operating activities was $30.2 million for the thirty-nine weeks ended October 29, 2016.

The primary uses of cash were a loss before income tax benefit of $12.6 million and a $23.1 million seasonal increase in inventory. The Company's merchandise inventory and accounts payable are influenced by the seasonality of its business. A significant reduction of accounts payable occurs annually in the fiscal first quarter, reflecting payments for merchandise inventory purchased during the prior year's holiday season. Excluding the impact of etailz, inventory per square foot was $86 at the end of the quarter, compared to $83 per square foot at the end of the third quarter last year

Cash used by investing activities was $51.9 million for the thirty-nine weeks ended October 29, 2016. The primary uses of cash were the investment in etailz of $36.3 million and capital expenditures of $16.7 million.

Cash used by financing activities was $1.4 million for the thirty-nine weeks ended October 29, 2016. The primary uses of cash were the purchases of common stock of $2.6 million and a $4.7 million payment on the line of credit, offset by proceeds from short-term borrowings of $5.9 million.

During the thirty-nine weeks ended October 29, 2016, the Company repurchased 686,137 shares of common stock at an average price of $3.87 per share. Since the inception of the program, the Company has repurchased 2.6 million shares of common stock at an average price of $3.83 per share. The Company has approximately $12.2 million available for future purchases under its repurchase program.

In May 2012, the Company entered into a $75 million credit facility (“Credit Facility”) which amended the previous credit facility. The principal amount of all outstanding loans under the Credit Facility together with any accrued but unpaid interest, are due and payable in May 2017, unless otherwise paid earlier pursuant to the terms of the Credit Facility. The Company currently expects to renew its Credit Facility prior to the expiration date. Payments of amounts due under the Credit Facility are secured by the assets of the Company.

As of October 29, 2016, the Company had $5.9 million in outstanding borrowings under the revolving credit facility and $53.7 million was available for borrowing. The weighted average interest rate on outstanding borrowings for the thirteen week period ended October 29, 2016 was 3.73%. As of October 31, 2015, there were no borrowings outstanding under lines of credit and $65.0 million was available for borrowing.

During the thirteen weeks ended October 29, 2016, in connection with the acquisition of etailz, the Company paid off etailz’s outstanding letter of credit in the amount of $4.7 million.

Refer to footnote 9 in the condensed consolidated financial statements for further information regarding the Company’s credit facility.

Capital Expenditures. During the thirty-nine weeks ended October 29, 2016, the Company made capital expenditures of $16.7 million. The Company currently plans to spend approximately $20.0 million in total for capital expenditures in fiscal 2016.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States requires that management apply accounting policies and make estimates and assumptions that affect results of operations and the reported amounts of assets and liabilities in the financial statements. Management continually evaluates its estimates and judgments including those related to merchandise inventory and return costs, income taxes and business combinations. Management bases its estimates and judgments on historical experience and other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the Form 10-K for the year ended January 30, 2016 includes a summary of the critical accounting policies and methods used by the Company in the preparation of its condensed consolidated financial statements. There have been no material changes or modifications to the policies since January 30, 2016. Except as described herein, there has been no material change to the accounting policies applied to our consolidated results and footnote disclosures. In accordance with the accounting guidance for business combinations, we use the acquisition method of accounting to allocate costs of acquired businesses to the assets acquired and liabilities assumed based on their estimated fair values at the dates of acquisition. The excess costs of acquired businesses over the fair values of the assets acquired and liabilities assumed are recognized as goodwill. The valuations of acquired assets and liabilities will impact the determination of future operating results. In addition to using management estimates and negotiated amounts, we use a variety of information sources to determine the estimated fair values of the assets and liabilities, including third-party appraisals for the estimated value and lives of identifiable intangible assets and property and equipment. The business and technical judgment of management is used in determining the useful lives of finite-lived intangible assets in accordance with the accounting guidance for goodwill and intangible assets.

Recently Issued Accounting Pronouncements:

In 2014, the FASB issued Accounting Standard Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The new standard is effective for the Company’s fiscal year beginning January 28, 2018. Early application is permitted. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the standard on its ongoing financial reporting.

In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory. The amendments, which apply to inventory that is measured using any method other than the last-in, first-out (LIFO) or retail inventory method, require that entities measure inventory at the lower of cost or net realizable value. ASU 2015-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016 and should be applied on a prospective basis. We are currently assessing the potential impact of adopting this ASU, but do not, at this time, anticipate a material impact to our consolidated results of operations, financial positions or cash flows.

In February 2016, the FASB issued ASU No. 2016-02, Leases, which will replace most existing lease accounting guidance in U.S. GAAP. The core principle of the ASU is that an entity should recognize the rights and obligations resulting from leases as assets and liabilities. The new standard requires qualitative and specific quantitative disclosures to supplement the amounts recorded in the financial statements so that users can understand more about the nature of an entity’s leasing activities, including significant judgments and changes in judgments. The new standard will be effective for the Company’s fiscal year beginning February 3, 2019, and requires the modified retrospective method of adoption. Early adoption is permitted. The Company is in the process of determining the method and timing of adoption and assessing the impact of ASU 2016-02 on its consolidated financial statements.

In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows, which require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The Company adopted this standard as part of its quarterly report for the period ended October 29, 2016.

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TRANS WORLD ENTERTAINMENT CORPORATION AND SUBSIDIARIES

PART I – FINANCIAL INFORMATION

Item 3 – Quantitative and Qualitative Disclosures about Market Risk

To the extent the Company borrows under its Credit Facility, the Company is subject to risk resulting from interest rate fluctuations since interest on the Company’s borrowings under its Credit Facility can be variable. Interest under the Credit Facility will accrue, at the election of the Company, at a Base Rate or LIBO Rate, plus, in each case, an Applicable Margin, which is determined by reference to the level of availability as defined in the Credit Agreement, with the Applicable Margin for LIBO Rate loans ranging from 2.25% to 2.75% and the Applicable Margin for Base Rate loans ranging from 0.75% to 1.25%. If interest rates on the Company’s Credit Facility were to increase by 25 basis points, and to the extent borrowings were outstanding, for every $1,000,000 outstanding on the facility, Loss before income taxes would be reduced by $2,500 per year. For a discussion of the Company’s accounting policies for financial instruments and further disclosures relating to financial instruments, see “Nature of Operations and Summary of Significant Accounting Policies” in the Notes to Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended January 30, 2016. The Company does not currently hold any derivative instruments.

Item 4 – Controls and Procedures

(a)    Evaluation of disclosure controls and procedures.    The Company’s Chief Executive Officer and Chief Financial Officer, after evaluating the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e)) as of October 29, 2016, have concluded that as of such date the Company’s disclosure controls and procedures were effective and designed to ensure that (i) information required to be disclosed by the issuer in the reports that it files or submits under the Securities Exchange Act of 1934 (the “Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and (ii) information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

 (b)    Changes in internal controls.    The acquisition of etailz, Inc. was significant to the Company and was consummated effective October 17, 2016. Upon consummation of the acquisition, etailz, Inc. became a consolidated subsidiary of the Company. The Company intends to take a period of time to fully incorporate the etailz, Inc. operations that it acquired into its evaluation of internal control over financial reporting. In connection with the foregoing evaluation by the Company’s Chief Executive Officer and Chief Financial Officer, other than as noted above, there have been no changes in the Company’s internal controls over financial reporting that occurred during the fiscal quarter covered by this quarterly report that have materially affected, or are reasonably likely to materially affect, the Company’s internal controls over financial reporting.

24

TRANS WORLD ENTERTAINMENT CORPORATION AND SUBSIDIARIES

PART II - OTHER INFORMATION

Item 1 – Legal Proceedings

The Company is subject to legal proceedings and claims that have arisen in the ordinary course of its business and have not been finally adjudicated. Although there can be no assurance as to the ultimate disposition of these matters, it is management’s opinion, based upon the information available at this time, that the expected outcome of these matters, individually and in the aggregate, will not have a material adverse effect on the results of operations and financial condition of the Company.

Item 1A – Risk Factors

Our acquisition of etailz, Inc. could have an adverse effect on our business.

On October 17, 2016, we acquired (the “Acquisition”) all of the issued and outstanding capital stock of etailz Inc. (“etailz”). The acquisition of a business and its integration with existing operations involves a number of financial, managerial and operational challenges that take significant management time and attention. In addition. we have incurred significant expenses and fees in connection with the Acquisition, and may incur additional expenses post-closing. Our overall profitability would be adversely affected if our time and expenses associated with businesses we have acquired or may acquire in the future are not matched or exceeded by the revenues that are derived from such acquisition.

In connection with our acquisition of etailz, we are expanding into a new market in which we have limited operating experience.

We have limited experience as a reseller on third party ecommerce marketplaces. Our entry into this new line of business may subject us to additional risks and uncertainties. If etailz is not successful, it may not produce substantial revenue or profit and our operating results could be adversely affected.

etailz revenue is dependent on maintaining etailz’ relationship with Amazon and failure to do so, or any restrictions on our ability to offer products on the Amazon Marketplace, could have a adverse impact on our business, financial condition and results of operations.

etailz generates substantially all of its revenue through the Amazon Marketplace. Therefore, we depend in large part on our relationship with Amazon for the continued growth of the etailz segment. In particular, we depend on our ability to offer products on the Amazon Marketplace. We also depend on Amazon for the timely delivery of products to customers. Any adverse change in our relationship with Amazon, including restrictions on the ability to offer products or termination of the relationship, could adversely affect the continued growth of our etailz segment and our financial condition and results of operations.

We may encounter difficulties in fully integrating etailz into our business and may not fully achieve, or achieve within a reasonable time frame, expected strategic objectives and other expected benefits of the Acquisition.

The success of the Acquisition of etailz will depend, in part, on our ability to realize the anticipated growth opportunities on a standalone basis and from the integration of etailz with our existing business. There may be substantial difficulties, costs and delays involved in the integration of etailz with our own business, including distracting management from day-to-day operations and potential incompatibility of corporate cultures, and costs and delays in implementing systems and procedures. In addition, the process of integrating the operations of etailz could cause an interruption of, or loss of momentum in, the activities of one or more of our combined businesses and the possible loss of key personnel or vendor partners. Any one or all of these factors may increase our operating costs or lower our anticipated financial performance. Our failure to fully integrate etailz could have an adverse effect on our financial condition and results of operations.

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds

In connection with the Company’s acquisition of etailz Inc. (“etailz”), a private company, on October 17, 2016, the Company issued to the sellers an aggregate of 5,730,659 shares of common stock.  The common shares, other than 1,572,552 shares issued to etailz’ chief executive officer, Mr. Joshua Neblett, were fully vested upon issuance. Mr. Neblett’s shares will vest over 27 months from the acquisition date.  The common shares were issued in a private transaction exempt from registration under the Securities Act of 1933 in reliance on Section 4(2) based primarily on representations made by each of the sellers.  The sale of the securities did not involve underwriters or any form of general solicitation or general advertising.  A description of the acquisition is contained in item 1.01 of the Company’s Form 8-K dated October 17, 2016, which is incorporated herein by reference.

Item 3 – Defaults Upon Senior Securities

None.

Item 4 – Mine Safety Disclosure

Not Applicable.

Item 5 – Other Information

None.

25

Item 6 - Exhibits

(A) Exhibits -

Exhibit No.		Description
	31.1	Chief Executive Officer certification pursuant to Section 302 of the
		Sarbanes-Oxley Act of 2002.
	31.2	Chief Financial Officer certification pursuant to Section 302 of the
		Sarbanes-Oxley Act of 2002.
	32	Certification pursuant to 18 U.S.C Section 1350, as adopted pursuant to
		Section 906 of the Sarbanes-Oxley Act of 2002.
	101.INS	XBRL Instance Document (furnished herewith)
	101.SCH	XBRL Taxonomy Extension Schema (furnished herewith)
	101.CAL	XBRL Taxonomy Extension Calculation Linkbase (furnished herewith)
	101.DEF	XBRL Taxonomy Extension Definition Linkbase (furnished herewith)
	101.LAB	XBRL Taxonomy Extension Label Linkbase (furnished herewith)
	101.PRE	XBRL Taxonomy Extension Presentation Linkbase (furnished herewith)

26

SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

TRANS WORLD ENTERTAINMENT CORPORATION

December 8, 2016	By: /s/ Michael Feurer
	Michael Feurer
	Chief Executive Officer
	(Principal Executive Officer)

December 8, 2016	By: /s/ John Anderson
	John Anderson
	Chief Financial Officer
	(Principal and Chief Accounting Officer)

27

EX-31.1

Exhibit 31.1

CHIEF EXECUTIVE OFFICER CERTIFICATION PURSUANT TO SECTION 302 OF SARBANES OXLEY ACT 2002

I, Michael Feurer certify that:

(1)	I have reviewed this report on Form 10–Q of the Registrant;
(2)	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
(3)	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
(4)	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

(5) The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated:   December 8, 2016
	/s/ Michael Feurer
	Michael Feurer
	Chief Executive Officer
	Trans World Entertainment Corporation

EX-31.2

Exhibit 31.2

CHIEF FINANCIAL OFFICER CERTIFICATION PURSUANT TO SECTION 302 OF SARBANES OXLEY ACT 2002

I, John Anderson, Chief Financial Officer of Trans World Entertainment Corporation (the “Registrant”), certify that:

(1)	I have reviewed this report on Form 10–Q of the Registrant;
(2)	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
(3)	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
(4)	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

(5) The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated:   December 8, 2016
	/s/ John Anderson
	John Anderson
	Chief Financial Officer
	Trans World Entertainment Corporation

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Trans World Entertainment Corporation (the “Company”) on Form 10-Q for the period ending October 29, 2016 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Michael Feurer, Chief Executive Officer of the Company and John Anderson, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of our knowledge:

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Michael Feurer	/s/ John Anderson
Michael Feurer	John Anderson
Chief Executive Officer	Chief Financial Officer
December 8, 2016	December 8, 2016

XML

Document And Entity Information	9 Months Ended
	Oct. 29, 2016 shares
Document and Entity Information [Abstract]
Entity Registrant Name	TRANS WORLD ENTERTAINMENT CORP
Document Type	10-Q
Current Fiscal Year End Date	--01-31
Entity Common Stock, Shares Outstanding	36,115,388
Amendment Flag	false
Entity Central Index Key	0000795212
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Accelerated Filer
Entity Well-known Seasoned Issuer	No
Document Period End Date	Oct. 29, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q3

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Oct. 29, 2016	Jan. 30, 2016	Oct. 31, 2015
CURRENT ASSETS:
Cash and cash equivalents	$ 4,708	$ 104,311	$ 74,854
Merchandise inventory	157,827	120,046	149,524
Other current assets	13,903	6,630	12,396
Total current assets	176,438	230,987	236,774
Net fixed assets	41,902	30,665	27,282
Goodwill	39,800
Net intangible assets	28,737
Restricted cash	16,100
Other assets	10,272	9,953	9,081
TOTAL ASSETS	313,249	271,605	273,137
CURRENT LIABILITIES:
Accounts payable	61,956	51,888	65,471
Notes payable	5,936
Accrued expenses and other current liabilities	9,116	8,974	6,763
Deferred revenue	7,813	8,983	8,430
Current portion of capital lease obligations			143
Total current liabilities	84,821	69,845	80,807
Contingent considerations	10,381
Other long-term liabilities	28,927	26,492	27,716
TOTAL LIABILITIES	124,129	96,337	108,523
SHAREHOLDERS’ EQUITY
Preferred stock ($0.01 par value; 5,000,000 shares authorized; none issued)
Common stock ($0.01 par value; 200,000,000 shares authorized; 64,252,671, 58,395,668 and 58,345,668 shares issued, respectively)	643	584	583
Additional paid-in capital	337,439	316,040	315,956
Treasury stock at cost (28,137,283, 27,411,133 and 27,270,691, shares, respectively)	(230,144)	(227,497)	(227,060)
Accumulated other comprehensive loss	(658)	(812)	(1,950)
Retained earnings	81,840	86,953	77,085
TOTAL SHAREHOLDERS’ EQUITY	189,120	175,268	164,614
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$ 313,249	$ 271,605	$ 273,137

XML

CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares	Oct. 29, 2016	Jan. 30, 2016	Oct. 31, 2015
Preferred stock par value (in Dollars per share)	$ 0.01	$ 0.01	$ 0.01
Preferred stock, shares authorized	5,000,000	5,000,000	5,000,000
Preferred stock, shares issued	0	0	0
Common stock par value (in Dollars per share)	$ 0.01	$ 0.01	$ 0.01
Common stock, shares authorized	200,000,000	200,000,000	200,000,000
Common stock, shares issued	64,252,671	58,395,668	58,345,668
Treasury stock, shares at cost	28,137,283	27,411,133	27,270,691

XML

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 29, 2016	Oct. 31, 2015	Oct. 29, 2016	Oct. 31, 2015
Net sales	$ 65,039	$ 67,925	$ 203,127	$ 213,339
Other revenue	1,242	1,125	3,232	3,413
Total revenue	66,281	69,050	206,359	216,752
Cost of sales	39,409	41,245	121,960	128,699
Gross profit	26,872	27,805	84,399	88,053
Selling, general and administrative expenses	34,680	31,600	97,415	93,731
Loss from operations	(7,808)	(3,795)	(13,016)	(5,678)
Interest expense	179	532	523	1,451
Other income	(51)	(44)	(1,068)	(84)
Loss before income tax expense	(7,936)	(4,283)	(12,471)	(7,045)
Income tax expense (benefit)	(7,452)	45	(7,358)	134
Net loss	$ (484)	$ (4,328)	$ (5,113)	$ (7,179)
BASIC AND DILUTED LOSS PER SHARE:
Basic and diluted loss per share (in Dollars per share)	$ (0.02)	$ (0.14)	$ (0.17)	$ (0.23)
Weighted average number of common shares outstanding – basic and diluted (in Shares)	31,434	31,107	30,854	31,140

XML

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 29, 2016	Oct. 31, 2015	Oct. 29, 2016	Oct. 31, 2015
Net loss	$ (484)	$ (4,328)	$ (5,113)	$ (7,179)
Amortization of pension costs	51	77	154	231
Comprehensive loss	$ (433)	$ (4,251)	$ (4,959)	$ (6,948)

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS $ in Thousands	3 Months Ended	9 Months Ended
	Oct. 29, 2016 USD ($)	Oct. 29, 2016 USD ($)	Oct. 31, 2015 USD ($)
Net cash used by operating activities		$ (30,179)	$ (26,165)
Cash flows from investing activities:
Purchases of business, net of cash acquired		(36,300)
Proceeds from sale of investment		1,600
Purchase of investments		(500)	(800)
Purchases of fixed assets		(16,726)	(15,293)
Net cash used by investing activities		(51,926)	(16,093)
Cash flows from financing activities:
Proceeds from S-T borrowings		5,936
Payment on line of credit	$ (4,700)	(4,727)
Exercise of stock options		39	19
Payments of capital lease obligations			(795)
Purchase of treasury stock		(2,646)	(649)
Net cash used by financing activities		(1,398)	(1,425)
Net decrease in cash and cash equivalents		(83,503)	(43,683)
Cash, cash equivalents, and restricted cash, beginning of period		104,311	118,537
Cash, cash equivalents, and restricted cash, end of period	20,808	20,808	74,854
Supplemental disclosures:
Cash, cash equivalents, and restricted cash, end of period	20,808	20,808
Less: restricted cash	(16,100)	(16,100)
Cash and cash equivalents per Condensed Consolidated Balance Sheet	4,708	4,708	74,854
Fair value of assets acquired, including cash acquired		93,754
Liabilities assumed		(24,858)
Net assets acquired	68,896	68,896
Less: Contingent consideration not yet paid	$ (10,381)	(10,381)
Less: Fair value of shares issued as consideration		(20,415)
Less: Cash acquired		(1,800)
Purchase of business, net of cash acquired		36,300
Issuance of equity grants		$ 6,074	$ 19

XML

Nature of Operations

9 Months Ended

Oct. 29, 2016

Disclosure Text Block [Abstract]

Nature of Operations [Text Block]

Note 1. Nature of Operations

Trans World Entertainment Corporation and subsidiaries (“the Company”) is a specialty retailer of entertainment products, including video, trend, music, electronics and related products in the United States. The Company operates a chain of retail entertainment stores, primarily under the names f.y.e. for your entertainment and Suncoast Motion Pictures, and e-commerce sites, www.fye.com, and www.secondspin.com in a single industry segment. As of October 29, 2016, the Company operated 294 stores totaling approximately 1.7 million square feet in the United States, the District of Columbia and the Commonwealth of Puerto Rico.

On October 17, 2016, the Company acquired all of the issued and outstanding capital stock of etailz, Inc. (“etailz”), an innovative and leading digital marketplace retail expert. See Note 6 to the Condensed Consolidated Financial Statements for additional information.

Liquidity and Cash Flows:

The Company’s primary sources of working capital are cash and cash equivalents on hand, cash provided by operations and borrowing capacity under its revolving credit facility (See Note 9 for further details). The Company’s cash flows fluctuate from quarter to quarter due to various items, including seasonality of sales and earnings, merchandise inventory purchases and returns and the related terms on the purchases and capital expenditures. Management believes it will have adequate resources to fund its cash needs for the next twelve months and beyond, including its capital spending, seasonal increase in merchandise inventory and other operating cash requirements and commitments.

Management anticipates that any future cash requirements due to a shortfall in cash from operations would be funded by the Company’s cash and cash equivalents on hand and its revolving credit facility.

Seasonality:

The Company’s business is seasonal, with the fourth fiscal quarter constituting the Company’s peak selling period. In fiscal 2015, the fourth quarter accounted for approximately 35% of annual net sales and all of net income. In anticipation of increased sales activity in the fourth quarter, the Company purchases additional inventory and hires seasonal associates to supplement its core store sales and distribution center staffs. If, for any reason, the Company’s sales were below seasonal norms during the fourth quarter, the Company’s operating results could be adversely affected. Quarterly sales can also be affected by the timing of new product releases, new store openings, store closings and the performance of existing stores.

XML

Basis of Presentation

9 Months Ended

Oct. 29, 2016

Disclosure Text Block [Abstract]

Basis of Accounting [Text Block]

Note 2: Basis of Presentation

The accompanying unaudited condensed consolidated financial statements consist of Trans World Entertainment Corporation, its wholly-owned subsidiary, Record Town, Inc. (“Record Town”), Record Town’s subsidiaries and etailz, Inc., all of which are wholly-owned. All significant intercompany accounts and transactions have been eliminated.

The interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. The information furnished in these unaudited condensed consolidated financial statements reflects all normal, recurring adjustments which, in the opinion of management, are necessary for the fair presentation of such financial statements. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to rules and regulations applicable to interim financial statements.

During the thirty-nine weeks ended October 29, 2016, the Company recorded an immaterial adjustment between Other Revenue and Selling, General and Administrative expenses in its prior year condensed consolidated financial statements for miscellaneous income, primarily related to commissions earned from third parties. The immaterial adjustment did not impact prior year loss from operations, net loss, and basic and diluted loss per share. With the adjustment, the prior year presentation is consistent with the current year presentation.

The information presented in the accompanying unaudited condensed consolidated balance sheet as of January 30, 2016 has been derived from the Company’s January 30, 2016 audited consolidated financial statements. All other information has been derived from the Company’s unaudited condensed consolidated financial statements as of and for the thirty-nine weeks ended October 29, 2016 and October 31, 2015. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 30, 2016.

The Company’s significant accounting policies are the same as those described in Note 1 to the Company’s Consolidated Financial Statements on Form 10-K for the fiscal year ended January 30, 2016. Except as described herein, there has been no material change to the accounting policies applied to our consolidated results and footnote disclosures. In accordance with the accounting guidance for business combinations, we use the acquisition method of accounting to allocate costs of acquired businesses to the assets acquired and liabilities assumed based on their estimated fair values at the dates of acquisition. The excess costs of acquired businesses over the fair values of the assets acquired and liabilities assumed are recognized as goodwill. The valuations of acquired assets and liabilities will impact the determination of future operating results. In addition to using management estimates and negotiated amounts, we use a variety of information sources to determine the estimated fair values of the assets and liabilities, including third-party appraisals for the estimated value and lives of identifiable intangible assets and property and equipment. The business and technical judgment of management is used in determining the useful lives of finite-lived intangible assets in accordance with the accounting guidance for goodwill and intangible assets.

XML

Recently Issued Accounting Pronouncements

9 Months Ended

Oct. 29, 2016

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

New Accounting Pronouncements and Changes in Accounting Principles [Text Block]

Note 3. Recently Issued Accounting Pronouncements

In 2014, the FASB issued Accounting Standard Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The new standard is effective for the Company’s fiscal year beginning January 28, 2018. Early application is permitted. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the standard on its ongoing financial reporting.

In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory. The amendments, which apply to inventory that is measured using any method other than the last-in, first-out (LIFO) or retail inventory method, require that entities measure inventory at the lower of cost or net realizable value. ASU 2015-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016 and should be applied on a prospective basis. We are currently assessing the potential impact of adopting this ASU, but do not, at this time, anticipate a material impact to our consolidated results of operations, financial positions or cash flows.

In February 2016, the FASB issued ASU No. 2016-02, Leases, which will replace most existing lease accounting guidance in U.S. GAAP. The core principle of the ASU is that an entity should recognize the rights and obligations resulting from leases as assets and liabilities. The new standard requires qualitative and specific quantitative disclosures to supplement the amounts recorded in the financial statements so that users can understand more about the nature of an entity’s leasing activities, including significant judgments and changes in judgments. The new standard will be effective for the Company’s fiscal year beginning February 3, 2019, and requires the modified retrospective method of adoption. Early adoption is permitted. The Company is in the process of determining the method and timing of adoption and assessing the impact of ASU 2016-02 on its consolidated financial statements.

In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows, which require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The Company adopted this standard as part of its quarterly report for the period ended October 29, 2016.

XML

Stock Based Compensation

9 Months Ended

Oct. 29, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

Note 4. Stock Based Compensation

As of October 29, 2016, there was approximately $0.9 million of unrecognized compensation cost related to stock awards that is expected to be recognized as expense over a weighted average period of 2.8 years.

As of October 29, 2016, stock awards authorized for issuance under the Company’s current long term equity incentive plans totaled 8.0 million. There are certain authorized stock plans for which the Company no longer grants awards. Of these awards authorized for issuance, 2.6 million were granted and are outstanding, 1.3 million of which were vested and exercisable. Awards available for future grants at October 29, 2016 were 1.2 million.

The table below outlines the assumptions that the Company used to estimate the fair value of stock options granted during the thirty-nine weeks ended October 29, 2016:

Dividend yield	0%
Expected stock price volatility	38.0%-47.5%
Risk-free interest rate	1.06%-1.56%
Expected award life (in years)	4.92-6.98
Weighted average fair value per share of options granted during the period	$1.19

The following table summarizes stock award activity during the thirty-nine weeks ended October 29, 2016:

	Employee and Director Stock Award Plans
	Number of Shares Subject To Option			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term		Other Share Awards (1)			Weighted Average Grant Fair Value
Balance January 30, 2016		2,111,825		$	4.04		5.00		211,174		$	3.79
Granted		909,664			3.74		9.80		68,097			3.84
Canceled		(636,425	)		5.25		—		—			—
Exercised		(18,000	)		2.09		—		(108,344	)		3.68
Balance October 29, 2016		2,367,064		$	3.61		7.44		170,927		$	3.87
Exercisable October 29, 2016		1,154,189		$	3.51		5.88		63,427		$	4.50

(1) Other Share Awards include deferred shares granted to Directors and restricted share units granted to executive officers.

As of October 29, 2016, the intrinsic value of stock awards outstanding was approximately $958,000 and exercisable was $736,000.

In connection with the acquisition of etailz, the Company issued 1,572,552 restricted shares of Company stock to a key etailz employee, with a grant date fair value of $3.56 per share. These shares vest ratably through January 2019. As of October 29, 2016, the Company recognized $207,000 of compensation cost related to these shares. As of October 29, 2016, there was approximately $5.4 million of unrecognized compensation cost related to these restricted shares that is expected to be recognized as expense over a weighted average period of 2.3 years.

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Defined Benefit Plans

9 Months Ended

Oct. 29, 2016

Disclosure Text Block Supplement [Abstract]

Compensation and Employee Benefit Plans [Text Block]

Note 5. Defined Benefit Plans

The Company maintains a non-qualified Supplemental Executive Retirement Plan (“SERP”) for certain executive officers of the Company. The SERP provides eligible executives defined pension benefits that supplement benefits under other retirement arrangements. During the thirty-nine weeks ended October 29, 2016, the Company did not make any cash contributions to the SERP and presently expects to pay approximately $1.1 million in benefits relating to the SERP during fiscal 2016.

The measurement date for the SERP is the fiscal year end, using actuarial techniques which reflect estimates for mortality, turnover and expected retirement. In addition, management makes assumptions concerning future salary increases. Discount rates are generally established as of the measurement date using theoretical bond models that select high-grade corporate bonds with maturities or coupons that correlate to the expected payouts of the applicable liabilities.

The following represents the components of the net periodic pension cost related to the Company’s SERP for the respective periods:

	Thirteen Weeks Ended						Thirty-nine Weeks Ended
	October 29,			October 31,			October 29,			October 31,
	2016			2015			2016			2015
	(in thousands)						(in thousands)
Service cost	$	15		$	17		$	45		$	51
Interest cost		137			145			411			435
Amortization of pension costs		55			86			166			258
Amortization of net gain(1)		(4	)		(9	)		(12	)		(27	)
Net periodic pension cost	$	203		$	239		$	610		$	717

(1) The amortization of net gain is related to a director retirement plan previously provided by the Company.

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Business Combinations

9 Months Ended

Oct. 29, 2016

Business Combinations [Abstract]

Business Combination Disclosure [Text Block]

Note 6. Business Combinations

On October 17, 2016, the Company completed the purchase of all of the issued and outstanding shares of etailz, Inc. (“etailz”), an innovative and leading digital marketplace retail expert. The Company paid $38.1 million in cash and issued 5.7 million shares of TWMC stock at closing to the shareholders of etailz as consideration for their shares. Based on the fair value of $3.56 per share on the acquisition date, the shares had a value of $20.4 million. An earn-out of up to a maximum of $14.6 million will be payable in fiscal 2018 and fiscal 2019 subject to the achievement by etailz of $6 million in operating income in fiscal 2017 and $7.5 million in fiscal 2018. In connection with the acquisition, The Company assumed the liability for etailz’s employee retention bonus plan, of which $1.9 million was due and payable at closing and the remaining $2.3 million will be earned over a two year service period. The acquisition and related costs were funded primarily from the Company’s cash on hand and short term borrowings under its revolving credit facility. The acquisition was accounted for using the purchase method of accounting. As of the date of filing this quarterly report on Form 10-Q, the preliminary purchase accounting has not yet been finalized due primarily to the proximity of the closing date of the transaction to the filing date of this quarterly report and the pending receipt of the final valuation for certain assets, including identifiable intangible assets.

The acquisition date fair value of the consideration for the above transaction consisted of the following as of October 17, 2016 (in thousands):

Cash consideration	$	38,100
Fair value of stock consideration		20,415
Fair value of contingent consideration		10,381
Fair value of purchase consideration	$	68,896

The excess of purchase consideration paid over the fair value of identifiable intangible assets acquired was recorded as goodwill. The goodwill recognized is not deductible for income tax purposes.

The following table summarizes the preliminary allocation of the aggregate purchase price to the estimated fair value of the net assets acquired:

	($ in thousands)
	October 17, 2016
Assets Acquired
Cash and Cash Equivalents	$	1,800
Accounts receivable		1,533
Prepaid expenses and other current assets		6,603
Inventory		14,669
Property and equipment, net		649
Other long term-assets		12
Acquired intangible assets:
Trade names		3,200
Technology		6,700
Vendor relationships		19,000
Unfavorable lease valuation		(125	)
Goodwill		39,800
Total assets acquired	$	93,841
Liabilities Assumed
Accounts payable	$	4,227
Debt		5,289
Other current liabilities		7,927
Deferred taxes		7,502
Total liabilities assumed	$	24,945
Net assets acquired	$	68,896

The Company recognized total acquisition related costs of $2.2 million for the thirteen and thirty-nine weeks ended October 29, 2016. These costs are included in selling, general and administrative expenses in the Company’s condensed consolidated statements of operations.

The results of operations of etailz will be reported in the Company’s etailz segment and has been included in the consolidated results of operations of the Company from the date of acquisition. The following unaudited pro forma financial information for the thirteen weeks and thirty-nine weeks ended October 29, 2016, and October 31, 2015, presents consolidated information as if the etailz acquisition had occurred on February 1, 2015. Because of different fiscal period ends, and in order to present results for comparable periods, the unaudited pro forma financial information for the thirty-nine weeks ended October 29, 2016, combines (i) the Company’s historical statement of operations for the thirty-nine weeks ended October 29, 2016, and (ii) etailz historical statement of income for the period from January 1, 2016 through August 31, 2016 and October 1, 2016 through October 16, 2016. The unaudited pro forma financial information for the thirteen weeks ended October 29, 2016, combines (i) the Company’s historical statement of operations for the thirteen weeks ended October 29, 2016; and (ii) etailz historical statement of income for the period from July 1, 2016 through August 31, 2016 and October 1, 2016 through October 16, 2016. The unaudited pro forma financial information for the thirty-nine weeks and thirteen weeks ended October 31, 2015, combines (i) the Company’s historical statement of operations for the thirty-nine weeks and thirteen weeks ended October 31, 2015, and (ii) etailz historical statement of income for the nine months and three months ended October 31, 2015. The unaudited pro forma financial information is presented after giving effect to certain adjustments for acquisition-related costs, depreciation, amortization of definite lived intangible assets, interest expense on acquisition financing, and related income tax effects. The unaudited pro forma financial information is based upon currently available information and upon certain assumptions that the Company believes are reasonable under the circumstances. The unaudited pro forma financial information does not purport to present what the Company’s results of operations would actually have been if the aforementioned transaction had in fact occurred on such date or at the beginning of the period indicated, nor does it project the Company’s financial position or results of operations at any future date or for any future period.

	Thirteen Weeks Ended						Thirty-nine Weeks Ended
	October 29,			October 31,			October 29,			October 31,
	2016			2015			2016			2015
Pro forma total revenue	$	90,655		$	90,942		$	287,060		$	278,862
Pro forma net loss		(6,945	)		(5,441	)		(13,513	)		(10,074	)
Pro forma basic and diluted loss per share	$	(0.19	)	$	(0.15	)	$	(0.37	)	$	(0.27	)
Pro forma weighted average number of common shares outstanding – basic and diluted		36,157			36,838			36,257			36,871

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Identifiable Intangible Assets

9 Months Ended

Oct. 29, 2016

Disclosure Text Block [Abstract]

Intangible Assets Disclosure [Text Block]

Note 7. Identifiable Intangible Assets

Identifiable intangible assets as of October 29, 2016 consisted of the following (in thousands, except weighted-average amortization period):

	October 29, 2016
	Weighted Average Amortization Period (in months)		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Vendor Relationships		120	$	19,000	$	61	$	18,939
Technology		60		6,711		87		6,624
Trade names and trademarks		60		3,200		26		3,174
			$	28,911	$	174	$	28,737

Estimated amortization expense for the remaining three months of fiscal 2016 and each of the five succeeding fiscal years and thereafter is as follows:

Year	Amortization
($ in thousands)
2016	$	1,094
2017		3,880
2018		3,880
2019		3,880
2020		3,880
2021		3,220
Thereafter	$	8,903

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Restricted Cash

9 Months Ended

Oct. 29, 2016

Restricted Cash [Abstract]

Restricted Cash [Text Block]

Note 8. Restricted Cash

In connection with the acquisition of etailz, Inc. and under the terms of the share purchase agreement, the Company was required to hold certain cash in escrow. At October 29, 2016, the Company had restricted cash of $16.1 million reported in long-term assets on the consolidated balance sheet. The Company designated $1.5 million of the restricted cash to be made available to satisfy any indemnification claims and $14.6 million of the restricted cash to equal the maximum earn-out amount that could be paid to the selling shareholders of etailz, Inc. in accordance with the share purchase agreement.

A summary of cash, cash equivalents and restricted cash is as follows ($ in thousands):

	October 29,		January 30,
	2016		2016
Cash and cash equivalents	$	4,708	$	104,311
Restricted cash		16,100		—
Total cash, cash equivalents and restricted cash	$	20,808	$	104,311

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Line of Credit

9 Months Ended

Oct. 29, 2016

Debt Disclosure [Abstract]

Debt Disclosure [Text Block]

Note 9. Line of Credit

In May 2012, the Company entered into a $75 million credit facility (“Credit Facility”) which amended the previous credit facility. The principal amount of all outstanding loans under the Credit Facility together with any accrued but unpaid interest, are due and payable in May 2017, unless otherwise paid earlier pursuant to the terms of the Credit Facility. The Company currently expects to review its Credit Facility prior to the expiration date. Payments of amounts due under the Credit Facility are secured by the assets of the Company.

The Credit Facility includes customary provisions, including affirmative and negative covenants, which include representations, warranties and restrictions on additional indebtedness and acquisitions. The Credit Facility also includes customary events of default, including, among other things, material adverse effect, bankruptcy, and certain changes of control. The Credit Facility also contains other terms and conditions, including limitations on the payment of dividends and covenants around the net number of store closings. The Company is compliant with all covenants.

Interest under the Credit Facility will accrue, at the election of the Company, at a Base Rate or LIBO Rate, plus, in each case, an Applicable Margin, which is determined by reference to the level of availability, with the Applicable Margin for LIBO Rate loans ranging from 2.25% to 2.75% and the Applicable Margin for Prime Rate loans ranging from 0.75% to 1.25%. In addition, a commitment fee ranging from 0.375% to 0.50% is also payable on unused commitments. The availability under the Credit Facility is subject to limitations based on inventory levels.

As of October 29, 2016, the Company had $5.9 million in outstanding borrowings under the revolving credit facility and $53.7 million was available for borrowing. The weighted average interest rate on outstanding borrowings for the thirteen week period ended October 29, 2016 was 3.73%. As of October 31, 2015, there were no borrowings outstanding under lines of credit and $65.0 million was available for borrowings.

During the thirteen weeks ended October 29, 2016 , in connection with the acquisition of etailz, the Company paid off etailz’s outstanding letter of credit in the amount of $4.7 million, as the Company assumed this liability and paid off immediately following the acquisition.

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Accumulated Other Comprehensive Loss

9 Months Ended

Oct. 29, 2016

Disclosure Text Block [Abstract]

Comprehensive Income (Loss) Note [Text Block]

Note 10. Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss that the Company reports in the condensed consolidated balance sheets represents net loss, adjusted for the difference between the accrued pension liability and accrued benefit cost, net of taxes, associated with the Company’s defined benefit plans. Comprehensive loss consists of net loss and the reclassification of pension costs previously reported in comprehensive loss for the thirteen and thirty-nine weeks ended October 29, 2016 and October 31, 2015.

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Depreciation and Amortization of Fixed Assets

9 Months Ended

Oct. 29, 2016

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment Disclosure [Text Block]

Note 11. Depreciation and Amortization of Fixed Assets and Intangible Assets

Depreciation and amortization of fixed assets included in the condensed consolidated statements of operations is as follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
	October 29,		October 31,		October 29,		October 31,
	2016		2015		2016		2015
	(in thousands)				(in thousands)
Cost of sales	$	104	$	124	$	301	$	370
Selling, general and administrative expenses		2,222		1,227		5,309		3,238
Total	$	2,326	$	1,351	$	5,610	$	3,608

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Basic and Diluted Loss Per Share

9 Months Ended

Oct. 29, 2016

Earnings Per Share [Abstract]

Earnings Per Share [Text Block]

Note 12. Basic and Diluted Loss Per Share

Basic loss per share is calculated by dividing net loss by the weighted average common shares outstanding for the period. Diluted Loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock (net of any assumed repurchases) that then shared in the earnings of the Company, if any. It is computed by dividing net loss by the sum of the weighted average shares outstanding and additional common shares that would have been outstanding if the dilutive potential common shares had been issued for the Company’s common stock awards from the Company’s Stock Award Plans.

For the thirteen and thirty-nine week periods ended October 29, 2016 and October 31, 2015, the impact of all outstanding stock awards was not considered because the Company reported a net loss and such impact would be anti-dilutive. Accordingly, basic and diluted loss per share is the same.

Total anti-dilutive stock awards for the thirteen and thirty-nine week periods ended October 29, 2016 were approximately 1.9 million shares and 1.8 million shares, respectively, as compared to 1.8 million shares and 1.7 million shares, respectively, for the thirteen and thirty-nine weeks ended October 31, 2015.

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Shareholders' Equity

9 Months Ended

Oct. 29, 2016

Stockholders' Equity Note [Abstract]

Stockholders' Equity Note Disclosure [Text Block]

Note 13. Shareholders’ Equity

In connection with the acquisition of etailz, in October 2016, the Company issued 5.7 million shares of Company common stock to the selling shareholders of etailz at fair value of $3.56 per share.

During the thirty-nine week period ended October 29, 2016, the Company repurchased 686,137 shares of common stock at an average price of $3.87 per share. Since the inception of the program, the Company has repurchased 2,558,180 shares of common stock at an average price of $3.83 per share. The Company has approximately $12.2 million available for future purchases under its repurchase program.

The Company classifies the repurchased shares as treasury stock on the Company’s condensed consolidated balance sheet.

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Income Taxes

9 Months Ended

Oct. 29, 2016

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

Note 14. Income Taxes

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent on the generation of future taxable income. Management considers the scheduled reversal of taxable temporary differences, projected future taxable income and tax planning strategies in making this assessment. Based on available objective evidence, management concluded that a full valuation allowance should continue to be recorded against the Company's deferred tax assets. Management will continue to assess the need for and amount of the valuation allowance against the deferred tax assets by giving consideration to all available evidence to the Company’s ability to generate future taxable income in its conclusion of the need for a full valuation allowance. Any reversal of the Company’s valuation allowance will favorably impact its results of operations in the period of reversal. The Company is currently unable to determine whether or when that reversal might occur, but it will continue to assess the realizability of its deferred tax assets and will adjust the valuation allowance if it is more likely than not that all or a portion of the deferred tax assets will become realizable in the future. The Company has significant net operating loss carry forwards and other tax attributes that are available to offset projected taxable income and current taxes payable, if any, for the year ending January 28, 2017.  The deferred tax impact resulting from the utilization of the net operating loss carry forwards and other tax attributes will be offset by a reduction in the valuation allowance. As of January 30, 2016, the Company had a net operating loss carry forward of $158.8 million for federal income tax purposes and approximately $247 million for state income tax purposes that expire at various times through 2035 and are subject to certain limitations and statutory expiration periods.

During the third quarter of fiscal 2016, in connection with the acquisition of etailz, the Company recognized a tax benefit of $7.5 million related to the reduction of its valuation allowance equivalent to the net deferred tax liabilities recorded on the etailz opening balance sheet. In assessing the realizability of the net deferred tax assets at the time of the acquisition of etailz, management considered whether it is more likely than not that some portion or all of the remaining deferred tax assets will not be realizable. Management considered the scheduled reversal of taxable temporary differences, projected future taxable income when combining Trans World Entertainment projected income or loss with etailz projected income or loss, and tax planning strategies when making this assessment. Based on the available objective evidence, management concluded that a full valuation allowance should be recorded against its deferred tax assets net of the deferred tax liabilities recorded in connection with the etailz acquisition.

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Stock Based Compensation (Tables)

9 Months Ended

Oct. 29, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]

The table below outlines the assumptions that the Company used to estimate the fair value of stock options granted during the thirty-nine weeks ended October 29, 2016:

Dividend yield	0%
Expected stock price volatility	38.0%-47.5%
Risk-free interest rate	1.06%-1.56%
Expected award life (in years)	4.92-6.98
Weighted average fair value per share of options granted during the period	$1.19

Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable [Table Text Block]

The following table summarizes stock award activity during the thirty-nine weeks ended October 29, 2016:

	Employee and Director Stock Award Plans
	Number of Shares Subject To Option			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term		Other Share Awards (1)			Weighted Average Grant Fair Value
Balance January 30, 2016		2,111,825		$	4.04		5.00		211,174		$	3.79
Granted		909,664			3.74		9.80		68,097			3.84
Canceled		(636,425	)		5.25		—		—			—
Exercised		(18,000	)		2.09		—		(108,344	)		3.68
Balance October 29, 2016		2,367,064		$	3.61		7.44		170,927		$	3.87
Exercisable October 29, 2016		1,154,189		$	3.51		5.88		63,427		$	4.50

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Defined Benefit Plans (Tables)

9 Months Ended

Oct. 29, 2016

Disclosure Text Block Supplement [Abstract]

Schedule of Net Benefit Costs [Table Text Block]

The following represents the components of the net periodic pension cost related to the Company’s SERP for the respective periods:

	Thirteen Weeks Ended						Thirty-nine Weeks Ended
	October 29,			October 31,			October 29,			October 31,
	2016			2015			2016			2015
	(in thousands)						(in thousands)
Service cost	$	15		$	17		$	45		$	51
Interest cost		137			145			411			435
Amortization of pension costs		55			86			166			258
Amortization of net gain(1)		(4	)		(9	)		(12	)		(27	)
Net periodic pension cost	$	203		$	239		$	610		$	717

(1) The amortization of net gain is related to a director retirement plan previously provided by the Company.

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Business Combinations (Tables)

9 Months Ended

Oct. 29, 2016

Business Combinations [Abstract]

Schedule of Business Acquisitions by Acquisition, Contingent Consideration [Table Text Block]

The acquisition date fair value of the consideration for the above transaction consisted of the following as of October 17, 2016 (in thousands):

Cash consideration	$	38,100
Fair value of stock consideration		20,415
Fair value of contingent consideration		10,381
Fair value of purchase consideration	$	68,896

Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination [Table Text Block]

The following table summarizes the preliminary allocation of the aggregate purchase price to the estimated fair value of the net assets acquired:

	($ in thousands)
	October 17, 2016
Assets Acquired
Cash and Cash Equivalents	$	1,800
Accounts receivable		1,533
Prepaid expenses and other current assets		6,603
Inventory		14,669
Property and equipment, net		649
Other long term-assets		12
Acquired intangible assets:
Trade names		3,200
Technology		6,700
Vendor relationships		19,000
Unfavorable lease valuation		(125	)
Goodwill		39,800
Total assets acquired	$	93,841
Liabilities Assumed
Accounts payable	$	4,227
Debt		5,289
Other current liabilities		7,927
Deferred taxes		7,502
Total liabilities assumed	$	24,945
Net assets acquired	$	68,896

Business Acquisition, Pro Forma Information [Table Text Block]

	Thirteen Weeks Ended						Thirty-nine Weeks Ended
	October 29,			October 31,			October 29,			October 31,
	2016			2015			2016			2015
Pro forma total revenue	$	90,655		$	90,942		$	287,060		$	278,862
Pro forma net loss		(6,945	)		(5,441	)		(13,513	)		(10,074	)
Pro forma basic and diluted loss per share	$	(0.19	)	$	(0.15	)	$	(0.37	)	$	(0.27	)
Pro forma weighted average number of common shares outstanding – basic and diluted		36,157			36,838			36,257			36,871

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Identifiable Intangible Assets (Tables)

9 Months Ended

Oct. 29, 2016

Disclosure Text Block [Abstract]

Schedule of Finite-Lived Intangible Assets [Table Text Block]

Identifiable intangible assets as of October 29, 2016 consisted of the following (in thousands, except weighted-average amortization period):

	October 29, 2016
	Weighted Average Amortization Period (in months)		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Vendor Relationships		120	$	19,000	$	61	$	18,939
Technology		60		6,711		87		6,624
Trade names and trademarks		60		3,200		26		3,174
			$	28,911	$	174	$	28,737

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]

Estimated amortization expense for the remaining three months of fiscal 2016 and each of the five succeeding fiscal years and thereafter is as follows:

Year	Amortization
($ in thousands)
2016	$	1,094
2017		3,880
2018		3,880
2019		3,880
2020		3,880
2021		3,220
Thereafter	$	8,903

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Restricted Cash (Tables)

9 Months Ended

Oct. 29, 2016

Restricted Cash [Abstract]

Schedule of Restricted Cash and Cash Equivalents [Table Text Block]

A summary of cash, cash equivalents and restricted cash is as follows ($ in thousands):

	October 29,		January 30,
	2016		2016
Cash and cash equivalents	$	4,708	$	104,311
Restricted cash		16,100		—
Total cash, cash equivalents and restricted cash	$	20,808	$	104,311

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Depreciation and Amortization of Fixed Assets (Tables)

9 Months Ended

Oct. 29, 2016

Property, Plant and Equipment [Abstract]

Schedule of Depreciation and Amortization of Fixed Assets [Table Text Block]

Depreciation and amortization of fixed assets included in the condensed consolidated statements of operations is as follows:

	Thirteen Weeks Ended				Thirty-nine Weeks Ended
	October 29,		October 31,		October 29,		October 31,
	2016		2015		2016		2015
	(in thousands)				(in thousands)
Cost of sales	$	104	$	124	$	301	$	370
Selling, general and administrative expenses		2,222		1,227		5,309		3,238
Total	$	2,326	$	1,351	$	5,610	$	3,608

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Nature of Operations (Details) ft² in Millions	3 Months Ended
	Jan. 31, 2016	Oct. 29, 2016 ft²
Disclosure Text Block [Abstract]
Number of Stores		294
Area of Stores (in Square Feet)		1.7
Percentage of Annual Net Sales Recorded in the Fourth Quarter	35.00%

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Stock Based Compensation (Details)	9 Months Ended
	Oct. 29, 2016 USD ($) $ / shares shares
Stock Based Compensation (Details) [Line Items]
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $	$ 900,000
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition	2 years 292 days
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | shares	8,000,000
Share Based Compensation Arrangement By Share Based Payment Award Options And Other Than Options Outstanding Number | shares	2,600,000
Share Based Compensation Arrangement By Share Based Payment Award Options And Other Than Options Vested And Expected To Vest Exercisable Number | shares	1,300,000
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | shares	1,200,000
Intrinsic Value of Stock Awards Outstanding | $	$ 958,000
Intrinsic Value of Stock Awards Exercisable | $	736,000
Restricted Stock [Member]
Stock Based Compensation (Details) [Line Items]
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $	$ 5,400,000
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition	2 years 109 days
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Granted | shares	1,572,552
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ / shares	$ 3.56
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost | $	$ 207,000

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Stock Based Compensation (Details) - Schedule for estimation of fair value for the stock based awards granted	9 Months Ended
	Oct. 29, 2016 $ / shares
Stock Based Compensation (Details) - Schedule for estimation of fair value for the stock based awards granted [Line Items]
Dividend yield	0.00%
Weighted average fair value per share of options granted during the period (in Dollars per share)	$ 1.19
Minimum [Member]
Stock Based Compensation (Details) - Schedule for estimation of fair value for the stock based awards granted [Line Items]
Expected stock price volatility	38.00%
Risk-free interest rate	1.06%
Expected award life (in years)	4 years 335 days
Maximum [Member]
Stock Based Compensation (Details) - Schedule for estimation of fair value for the stock based awards granted [Line Items]
Expected stock price volatility	47.50%
Risk-free interest rate	1.56%
Expected award life (in years)	6 years 357 days

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Stock Based Compensation (Details) - Schedule of Disclosure of Share-based Compensation Arrangements by Share-based Payment Award - $ / shares			9 Months Ended
		Jan. 31, 2016	Oct. 29, 2016	Oct. 29, 2016
Schedule of Disclosure of Share-based Compensation Arrangements by Share-based Payment Award [Abstract]
Number of Shares Subject To Option		2,111,825
Weighted Average Exercise Price (in Dollars per share)		$ 4.04
Weighted Average Remaining Contractual Term		5 years		7 years 160 days
Other Share Awards	[1]	211,174
Weighted Average Grant Fair Value, Other Share Awards (in Dollars per share)		$ 3.79
Exercisable October 29, 2016			1,154,189	1,154,189
Exercisable October 29, 2016 (in Dollars per share)			$ 3.51	$ 3.51
Exercisable October 29, 2016				5 years 321 days
Exercisable October 29, 2016	[1]		63,427	63,427
Exercisable October 29, 2016 (in Dollars per share)			$ 4.50	$ 4.50
Granted	[1]		68,097
Granted (in Dollars per share)			$ 3.84
Granted			909,664
Granted (in Dollars per share)			$ 3.74
Granted			9 years 292 days
Canceled			(636,425)
Canceled (in Dollars per share)			$ 5.25
Canceled	[1]
Exercised			(18,000)
Exercised (in Dollars per share)			$ 2.09
Exercised	[1]		(108,344)
Exercised (in Dollars per share)			$ 3.68
Number of Shares Subject To Option			2,367,064	2,367,064
Weighted Average Exercise Price (in Dollars per share)			$ 3.61	$ 3.61
Other Share Awards	[1]		170,927	170,927
Weighted Average Grant Fair Value, Other Share Awards (in Dollars per share)			$ 3.87	$ 3.87

[1] Other Share Awards include deferred shares granted to Directors and restricted share units granted to executive officers.

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Defined Benefit Plans (Details) $ in Millions	Oct. 29, 2016 USD ($)
Supplemental Employee Retirement Plan [Member]
Defined Benefit Plans (Details) [Line Items]
Defined Benefit Plan, Expected Future Benefit Payments, Next Twelve Months	$ 1.1

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Defined Benefit Plans (Details) - Schedule Components of Net Periodic Benefit Cost and Other Comprehensive Income Loss - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Oct. 29, 2016	Oct. 31, 2015	Oct. 29, 2016	Oct. 31, 2015
Schedule Components of Net Periodic Benefit Cost and Other Comprehensive Income Loss [Abstract]
Service cost		$ 15	$ 17	$ 45	$ 51
Interest cost		137	145	411	435
Amortization of pension costs		55	86	166	258
Amortization of net gain	[1]	(4)	(9)	(12)	(27)
Net periodic pension cost		$ 203	$ 239	$ 610	$ 717

[1] The amortization of net gain is related to a Director Retirement Plan previously provided by the Company.

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Business Combinations (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions		3 Months Ended		9 Months Ended
	Oct. 17, 2016	Oct. 29, 2016	Oct. 17, 2016	Oct. 29, 2016	Oct. 29, 2016
Business Combinations [Abstract]
Payments to Acquire Businesses, Net of Cash Acquired	$ 38,100		$ 38,100		$ 36,300
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares (in Shares)			5.7
Business Acquisition, Share Price (in Dollars per share)	$ 3.56		$ 3.56
Equity Issued in Business Combination, Fair Value Disclosure	$ 20,400		$ 20,400
EarnOutProvisionAchievementDescription				Anearn-out of up to a maximum of $14.6 million will be payable in fiscal 2018 and fiscal 2019 subject to the achievement byetailz of $6 million in operating income in fiscal 2017 and $7.5 million in fiscal 2018.
MaximumEarnOutProvision				$ 14,600
Due to Employees, Current	1,900		1,900
Due to Employees, Noncurrent	$ 2,300		$ 2,300
Business Combination, Acquisition Related Costs		$ 2,200			$ 2,200

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Business Combinations (Details) - Schedule of Fair Value of Contingent Consideration - USD ($) $ in Thousands		3 Months Ended	9 Months Ended
	Oct. 17, 2016	Oct. 17, 2016	Oct. 29, 2016
Schedule of Fair Value of Contingent Consideration [Abstract]
Cash consideration	$ 38,100	$ 38,100	$ 36,300
Fair value of stock consideration	20,415		(20,415)
Fair value of contingent consideration	10,381	10,381	$ 10,381
Fair value of purchase consideration	$ 68,896	$ 68,896

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Business Combinations (Details) - Schedule of Preliminary Allocation of the Aggregate Purchase Price - USD ($) $ in Thousands		9 Months Ended
	Oct. 17, 2016	Oct. 29, 2016
Assets Acquired
Cash and Cash Equivalents	$ 1,800	$ (1,800)
Accounts receivable	1,533
Prepaid expenses and other current assets	6,603
Inventory	14,669
Property and equipment, net	649
Other long term-assets	12
Acquired intangible assets:
Trade names		28,911
Unfavorable lease valuation	(125)
Goodwill	39,800	39,800
Total assets acquired	93,841
Liabilities Assumed
Accounts payable	4,227
Debt	5,289
Other current liabilities	7,927
Deferred taxes	7,502
Total liabilities assumed	24,945
Net assets acquired	68,896
Trademarks and Trade Names [Member]
Acquired intangible assets:
Trade names	3,200	3,200
Technology-Based Intangible Assets [Member]
Acquired intangible assets:
Trade names		6,711
Technology	6,700
Vendor Relationships
Acquired intangible assets:
Trade names		$ 19,000
Vendor relationships	$ 19,000

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Business Combinations (Details) - Schedule of Pro Forma Financial Information Related to the Business Acquisition - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 29, 2016	Oct. 31, 2015	Oct. 29, 2016	Oct. 31, 2015
Schedule of Pro Forma Financial Information Related to the Business Acquisition [Abstract]
Pro forma total revenue	$ 90,655	$ 90,942	$ 287,060	$ 278,862
Pro forma net loss	$ (6,945)	$ (5,441)	$ (13,513)	$ (10,074)
Pro forma basic and diluted loss per share (in Dollars per share)	$ (0.19)	$ (0.15)	$ (0.37)	$ (0.27)
Pro forma weighted average number of common shares outstanding – basic and diluted (in Shares)	36,157	36,838	36,257	36,871

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Identifiable Intangible Assets (Details) - Schedule of Identifiable Intangible Assets - USD ($) $ in Thousands	9 Months Ended
	Oct. 29, 2016	Oct. 17, 2016
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	$ 28,911
Accumulated Amortization	174
Net Carrying Amount	$ 28,737
Vendor Relationships
Finite-Lived Intangible Assets [Line Items]
Weighted Average Amortization Period (in months)	120 months
Gross Carrying Amount	$ 19,000
Accumulated Amortization	61
Net Carrying Amount	$ 18,939
Technology-Based Intangible Assets [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Amortization Period (in months)	60 months
Gross Carrying Amount	$ 6,711
Accumulated Amortization	87
Net Carrying Amount	$ 6,624
Trademarks and Trade Names [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Amortization Period (in months)	60 months
Gross Carrying Amount	$ 3,200	$ 3,200
Accumulated Amortization	26
Net Carrying Amount	$ 3,174

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Identifiable Intangible Assets (Details) - Schedule of Estimated Amortization Expense $ in Thousands	Oct. 29, 2016 USD ($)
Schedule of Estimated Amortization Expense [Abstract]
2016	$ 1,094
2017	3,880
2018	3,880
2019	3,880
2020	3,880
2021	3,220
Thereafter	$ 8,903

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Restricted Cash (Details) $ in Thousands	9 Months Ended
	Oct. 29, 2016 USD ($)
Restricted Cash [Abstract]
Restricted Cash and Investments	$ 16,100
Business Combination, Indemnification Assets, Amount as of Acquisition Date	1,500
Restricted Cash Maximum Earn Out Provision	$ 14,600

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Restricted Cash (Details) - Schedule of Cash, Cash Equivalents, and Restricted Cash - USD ($) $ in Thousands	Oct. 29, 2016	Jan. 30, 2016	Oct. 31, 2015
Schedule of Cash, Cash Equivalents, and Restricted Cash [Abstract]
Cash and cash equivalents	$ 4,708	$ 104,311	$ 74,854
Restricted cash	16,100
Total cash, cash equivalents and restricted cash	$ 20,808	$ 104,311

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Line of Credit (Details) - USD ($)	3 Months Ended	9 Months Ended
	Oct. 29, 2016	Oct. 29, 2016	Oct. 29, 2016	Oct. 31, 2015	May 02, 2012
Line of Credit (Details) [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity (in Dollars)					$ 75,000,000
Line of Credit Facility, Fair Value of Amount Outstanding (in Dollars)	$ 5,900,000	$ 5,900,000	$ 5,900,000	$ 0
Line of Credit Facility, Current Borrowing Capacity (in Dollars)	$ 53,700,000	$ 53,700,000	53,700,000	$ 65,000,000
Line of Credit Facility, Interest Rate During Period	3.73%
Repayments of Lines of Credit (in Dollars)	$ 4,700,000		$ 4,727,000
Credit Facility [Member] | Minimum [Member]
Line of Credit (Details) [Line Items]
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage		0.375%
Credit Facility [Member] | Minimum [Member] | LIBOR Rate [Member]
Line of Credit (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate		2.25%
Credit Facility [Member] | Minimum [Member] | Base Rate [Member]
Line of Credit (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate		0.75%
Credit Facility [Member] | Maximum [Member]
Line of Credit (Details) [Line Items]
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage		0.50%
Credit Facility [Member] | Maximum [Member] | LIBOR Rate [Member]
Line of Credit (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate		2.75%
Credit Facility [Member] | Maximum [Member] | Base Rate [Member]
Line of Credit (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate		1.25%

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Depreciation and Amortization of Fixed Assets (Details) - Schedule of Depreciation and Amortization of Fixed Assets - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 29, 2016	Oct. 31, 2015	Oct. 29, 2016	Oct. 31, 2015
Schedule of Depreciation and Amortization of Fixed Assets [Abstract]
Cost of sales	$ 104	$ 124	$ 301	$ 370
Selling, general and administrative expenses	2,222	1,227	5,309	3,238
Total	$ 2,326	$ 1,351	$ 5,610	$ 3,608

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Basic and Diluted Loss Per Share (Details) - shares shares in Millions	3 Months Ended		9 Months Ended
	Oct. 29, 2016	Oct. 31, 2015	Oct. 29, 2016	Oct. 31, 2015
Earnings Per Share [Abstract]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	1.9	1.8	1.8	1.7

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Shareholders' Equity (Details) $ / shares in Units, $ in Millions	1 Months Ended	9 Months Ended	39 Months Ended
	Oct. 29, 2016 USD ($) $ / shares	Oct. 29, 2016 USD ($) $ / shares shares	Oct. 29, 2016 USD ($) $ / shares shares
Shareholders' Equity (Details) [Line Items]
Common Stock, Value, Outstanding (in Dollars) | $	$ 5.7	$ 5.7	$ 5.7
Sale of Stock, Price Per Share | $ / shares	$ 3.56	$ 3.56	$ 3.56
Common Stock [Member]
Shareholders' Equity (Details) [Line Items]
Stock Repurchased During Period, Shares (in Shares) | shares		686,137	2,558,180
Treasury Stock Acquired, Average Cost Per Share | $ / shares	$ 3.83	$ 3.87
Stock Repurchase Program, Remaining Authorized Repurchase Amount (in Dollars) | $	$ 12.2	$ 12.2	$ 12.2

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Income Taxes (Details) - USD ($) $ in Thousands		3 Months Ended			9 Months Ended
	Jan. 30, 2016	Oct. 29, 2016	Oct. 29, 2016	Oct. 31, 2015	Oct. 29, 2016	Oct. 31, 2015
Income Taxes (Details) [Line Items]
Income Tax Expense (Benefit)		$ 7,500	$ (7,452)	$ 45	$ (7,358)	$ 134
Domestic Tax Authority [Member]
Income Taxes (Details) [Line Items]
Operating Loss Carryforwards	$ 158,800
Tax Credit Carryforward Expiration Year	2035
State and Local Jurisdiction [Member]
Income Taxes (Details) [Line Items]
Operating Loss Carryforwards	$ 247,000
Tax Credit Carryforward Expiration Year	2035