ý | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 13-3499319 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
7 Times Square, New York, NY | 10036 | |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer | ý | Accelerated filer | ¨ | |||
Non-accelerated filer | ¨ | Smaller reporting company | ¨ |
Class | Outstanding as of July 27, 2012 | |
Common Stock, $.0068 par value | 47,324,330 |
Page No. | ||
Item 1. | Financial Statements (unaudited) | |
Item 2. | ||
Item 3. | ||
Item 4. | ||
Item 2. | ||
Item 6. | ||
• | the Company's ability to anticipate and respond to changing client preferences and fashion trends and provide a balanced assortment of merchandise that satisfies client demands in a timely manner; |
• | the effectiveness of the Company's brand awareness and marketing programs, and its ability to maintain the value of its brands; |
• | the Company's ability to manage inventory levels and changes in merchandise mix; |
• | the Company's ability to successfully implement its business transformation initiatives and upgrade and maintain its information systems, including adequate system security controls, successful transitioning of certain information technology functions to third parties and the ability to operate in accordance with its business continuity plan in the event of a disruption; |
• | the Company's reliance on key management and its ability to hire, retain and train qualified associates; |
• | the performance and operation of the Company's websites and the risks associated with Internet sales; |
• | the Company's ability to successfully execute brand goals, objectives and new concepts; |
• | the impact of fluctuations in sourcing costs, in particular increases in the costs of raw materials, labor, fuel and transportation; |
• | the depressed levels of consumer spending and consumer confidence resulting from the worldwide economic downturn and financial crisis; |
• | the Company's ability to secure and protect trademarks and other intellectual property rights; |
• | the Company's reliance on foreign sources of production and the associated risks of doing business in foreign markets, including fluctuations in the value of the U.S. dollar against foreign currencies, the imposition of duties or other possible trade law or import restrictions, including legislation relating to import quotas, and financial or political instability in any of the countries in which the Company's merchandise is manufactured; |
• | the Company's reliance on third-party manufacturers and key vendors, including operational risks such as reduced production capacity, errors in complying with merchandise specifications, insufficient quality control and failure to meet production deadlines; |
• | the Company's ability to successfully manage store growth and optimize the productivity and profitability of its store portfolio; |
• | the impact of a privacy breach and the resulting effect on the Company's business and reputation; |
• | a significant change in the regulatory environment applicable to the Company's business and the Company's ability to comply with legal and regulatory requirements; |
• | the failure by independent manufacturers to comply with the Company's social compliance program requirements; |
• | the effect of competitive pressures from other retailers; |
• | the effect of continued uncertainty in the global economy on the Company's liquidity and capital resources; |
• | the Company's dependence on its Louisville distribution center and third-party distribution facilities and transportation companies, including any significant interruptions due to work stoppages, slowdowns or strikes by employees of the third-party vendors that it utilizes; |
• | the impact on the Company's stock price relating to the Company's level of sales and earnings growth; |
• | acts of war or terrorism in the United States or worldwide, and the potential impact of natural disasters and public health concerns, including severe infectious diseases, particularly on the Company's foreign sourcing offices and the manufacturing operations of the Company's vendors; |
• | the Company's dependence on shopping malls and other retail centers to attract customers; |
• | the impact of potential consolidation of commercial and retail landlords on the Company's ability to negotiate favorable rental terms; |
• | the effect of external economic factors on the Company's future funding obligations for its defined benefit pension plan; and |
• | the impact of climate change on the Company's business. |
Quarter Ended | Six Months Ended | ||||||||||||||
July 28, 2012 | July 30, 2011 | July 28, 2012 | July 30, 2011 | ||||||||||||
(in thousands, except per share amounts) | |||||||||||||||
Net sales | $ | 594,872 | $ | 558,201 | $ | 1,155,283 | $ | 1,081,829 | |||||||
Cost of sales | 262,471 | 251,400 | 505,511 | 475,076 | |||||||||||
Gross margin | 332,401 | 306,801 | 649,772 | 606,753 | |||||||||||
Selling, general and administrative expenses | 279,456 | 265,125 | 551,474 | 519,158 | |||||||||||
Operating income | 52,945 | 41,676 | 98,298 | 87,595 | |||||||||||
Interest income | 101 | 98 | 656 | 333 | |||||||||||
Interest expense | 485 | 531 | 820 | 811 | |||||||||||
Income before income taxes | 52,561 | 41,243 | 98,134 | 87,117 | |||||||||||
Income tax provision | 21,826 | 16,451 | 38,667 | 35,011 | |||||||||||
Net income | $ | 30,735 | $ | 24,792 | $ | 59,467 | $ | 52,106 | |||||||
Earnings per share: | |||||||||||||||
Basic earnings per share | $ | 0.64 | $ | 0.48 | $ | 1.23 | $ | 0.99 | |||||||
Weighted average shares outstanding | 47,571 | 51,277 | 47,747 | 51,679 | |||||||||||
Diluted earnings per share | $ | 0.63 | $ | 0.47 | $ | 1.21 | $ | 0.97 | |||||||
Weighted average shares outstanding, assuming dilution | 48,118 | 52,161 | 48,398 | 52,625 |
Quarter Ended | Six Months Ended | ||||||||||||||
July 28, 2012 | July 30, 2011 | July 28, 2012 | July 30, 2011 | ||||||||||||
(in thousands) | (in thousands) | ||||||||||||||
Net income | $ | 30,735 | $ | 24,792 | $ | 59,467 | $ | 52,106 | |||||||
Other comprehensive income: | |||||||||||||||
Amortization of net loss included in net periodic pension benefit cost | 175 | 24 | 350 | 47 | |||||||||||
Other comprehensive income, before tax | 175 | 24 | 350 | 47 | |||||||||||
Income tax expense/(benefit) on other comprehensive income items | 75 | 9 | 155 | (30 | ) | ||||||||||
Other comprehensive income, net of tax | 100 | 15 | 195 | 77 | |||||||||||
Comprehensive income | $ | 30,835 | $ | 24,807 | $ | 59,662 | $ | 52,183 |
July 28, 2012 | January 28, 2012 | July 30, 2011 | |||||||||
(in thousands, except share amounts) | |||||||||||
Assets | |||||||||||
Current assets | |||||||||||
Cash and cash equivalents | $ | 132,663 | $ | 150,208 | $ | 145,178 | |||||
Accounts receivable | 28,074 | 19,591 | 29,468 | ||||||||
Merchandise inventories | 221,634 | 213,447 | 213,686 | ||||||||
Refundable income taxes | 7,765 | 11,965 | 26,457 | ||||||||
Deferred income taxes | 32,122 | 30,999 | 25,845 | ||||||||
Prepaid expenses and other current assets | 65,816 | 49,107 | 64,513 | ||||||||
Total current assets | 488,074 | 475,317 | 505,147 | ||||||||
Property and equipment, net | 374,803 | 360,890 | 359,355 | ||||||||
Deferred income taxes | 29,361 | 39,134 | 27,514 | ||||||||
Other assets | 13,350 | 12,340 | 12,348 | ||||||||
Total assets | $ | 905,588 | $ | 887,681 | $ | 904,364 | |||||
Liabilities and Stockholders’ Equity | |||||||||||
Current liabilities | |||||||||||
Accounts payable | $ | 97,725 | $ | 94,157 | $ | 97,501 | |||||
Accrued salaries and bonus | 31,080 | 16,122 | 22,094 | ||||||||
Current portion of long-term performance compensation | 29,750 | 19,373 | 17,835 | ||||||||
Accrued tenancy | 45,258 | 41,435 | 43,055 | ||||||||
Gift certificates and merchandise credits redeemable | 41,518 | 50,750 | 38,043 | ||||||||
Accrued expenses and other current liabilities | 81,293 | 64,060 | 70,458 | ||||||||
Total current liabilities | 326,624 | 285,897 | 288,986 | ||||||||
Deferred lease costs | 158,450 | 159,435 | 166,300 | ||||||||
Deferred income taxes | 1,250 | 1,320 | 1,040 | ||||||||
Long-term performance compensation, less current portion | 20,634 | 42,122 | 31,222 | ||||||||
Other liabilities | 30,455 | 35,030 | 22,893 | ||||||||
Commitments and contingencies | |||||||||||
Stockholders’ equity | |||||||||||
Common stock, $.0068 par value; 200,000,000 shares authorized; 82,563,516 shares issued | 561 | 561 | 561 | ||||||||
Additional paid-in capital | 811,382 | 811,707 | 798,992 | ||||||||
Retained earnings | 633,724 | 574,257 | 539,797 | ||||||||
Accumulated other comprehensive loss | (5,123 | ) | (5,318 | ) | (2,301 | ) | |||||
Treasury stock, 35,239,186, 33,284,631 and 30,324,921 shares, respectively, at cost | (1,072,369 | ) | (1,017,330 | ) | (943,126 | ) | |||||
Total stockholders’ equity | 368,175 | 363,877 | 393,923 | ||||||||
Total liabilities and stockholders’ equity | $ | 905,588 | $ | 887,681 | $ | 904,364 |
Six Months Ended | |||||||
July 28, 2012 | July 30, 2011 | ||||||
(in thousands) | |||||||
Operating activities: | |||||||
Net income | $ | 59,467 | $ | 52,106 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Deferred income taxes | 8,425 | 6,230 | |||||
Depreciation and amortization | 46,365 | 47,992 | |||||
Loss on disposal and write-down of property and equipment | 1,354 | 533 | |||||
Stock-based compensation | 7,463 | 10,702 | |||||
Non-cash interest and other non-cash items | 307 | 228 | |||||
Tax benefit from exercise/vesting of stock awards | 5,390 | 6,483 | |||||
Changes in assets and liabilities: | |||||||
Accounts receivable | (8,483 | ) | (11,937 | ) | |||
Merchandise inventories | (8,187 | ) | (20,061 | ) | |||
Prepaid expenses and other current assets | (12,113 | ) | (7,146 | ) | |||
Refundable income taxes | 4,200 | 174 | |||||
Other non-current assets and liabilities, net | 1,309 | 15,227 | |||||
Accounts payable and accrued expenses | (300 | ) | (30,533 | ) | |||
Net cash provided by operating activities | 105,197 | 69,998 | |||||
Investing activities: | |||||||
Purchases of marketable securities | (1,445 | ) | (550 | ) | |||
Sales of marketable securities | 17 | 84 | |||||
Purchase of intangible asset | (250 | ) | — | ||||
Purchases of property and equipment | (59,642 | ) | (61,542 | ) | |||
Net cash used for investing activities | (61,320 | ) | (62,008 | ) | |||
Financing activities: | |||||||
Proceeds from the issuance of common stock pursuant to the Associate Discount Stock Purchase Plan | 1,154 | 1,189 | |||||
Proceeds from exercise of stock options | 11,080 | 6,532 | |||||
Excess tax benefits from stock-based compensation | 5,828 | 7,691 | |||||
Repurchases of common and restricted stock | (79,086 | ) | (104,921 | ) | |||
Repayments of fixed asset financing and capital lease obligations | (722 | ) | (810 | ) | |||
Change in trade payable program obligation, net | 324 | 863 | |||||
Net cash used for financing activities | (61,422 | ) | (89,456 | ) | |||
Net decrease in cash | (17,545 | ) | (81,466 | ) | |||
Cash and cash equivalents, beginning of period | 150,208 | 226,644 | |||||
Cash and cash equivalents, end of period | $ | 132,663 | $ | 145,178 | |||
Supplemental disclosures of cash flow information: | |||||||
Cash paid during the period for interest | $ | 668 | $ | 640 | |||
Cash paid during the period for income taxes | $ | 28,311 | $ | 22,463 | |||
Accrual for purchases of property and equipment | $ | 19,988 | $ | 25,890 |
1. | Basis of Presentation |
2. | Recent Accounting Pronouncements |
3. | Fair Value Measurements |
• | Level 1 — Quoted prices in active markets for identical assets or liabilities. |
• | Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for markets that are not active; or other inputs that are observable or can be corroborated by observable market data. |
• | Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. |
3. | Fair Value Measurements (Continued) |
July 28, 2012 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
(in thousands) | ||||||||||||||||
Non-qualified deferred compensation plan assets (1) | $ | 5,889 | $ | 2,037 | $ | 3,852 | $ | — | ||||||||
Total assets | $ | 5,889 | $ | 2,037 | $ | 3,852 | $ | — | ||||||||
January 28, 2012 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
(in thousands) | ||||||||||||||||
Non-qualified deferred compensation plan assets (1) | $ | 4,149 | $ | 1,309 | $ | 2,840 | $ | — | ||||||||
Total assets | $ | 4,149 | $ | 1,309 | $ | 2,840 | $ | — |
July 30, 2011 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
(in thousands) | ||||||||||||||||
Non-qualified deferred compensation plan assets (1) | $ | 3,240 | $ | 1,073 | $ | 2,167 | $ | — | ||||||||
Total assets | $ | 3,240 | $ | 1,073 | $ | 2,167 | $ | — |
(1) | The Company maintains a self-directed, non-qualified deferred compensation plan structured as a rabbi trust for certain executives at the vice-president level and above. Certain of the investment assets of the rabbi trust are valued based on quoted market prices, which are considered Level 1 inputs, with the remainder valued based on quoted prices for identical securities in markets that are not active, which are considered Level 2 inputs. |
4. | Earnings Per Share |
Quarter Ended | |||||||||||||||||||||
July 28, 2012 | July 30, 2011 | ||||||||||||||||||||
(in thousands, except per share amounts) | |||||||||||||||||||||
Basic Earnings per Share: | Net Income | Shares | Per Share Amount | Net Income | Shares | Per Share Amount | |||||||||||||||
Net income | $ | 30,735 | $ | 24,792 | |||||||||||||||||
Less net income associated with participating securities | 446 | 421 | |||||||||||||||||||
Basic earnings per share | $ | 30,289 | 47,571 | $ | 0.64 | $ | 24,371 | 51,277 | $ | 0.48 | |||||||||||
Diluted Earnings per Share: | |||||||||||||||||||||
Net income | $ | 30,735 | $ | 24,792 | |||||||||||||||||
Less net income associated with participating securities | 441 | 414 | |||||||||||||||||||
Effect of dilutive securities | 547 | 884 | |||||||||||||||||||
Diluted earnings per share | $ | 30,294 | 48,118 | $ | 0.63 | $ | 24,378 | 52,161 | $ | 0.47 | |||||||||||
Six Months Ended | |||||||||||||||||||||
July 28, 2012 | July 30, 2011 | ||||||||||||||||||||
(in thousands, except per share amounts) | |||||||||||||||||||||
Basic Earnings per Share: | Net Income | Shares | Per Share Amount | Net Income | Shares | Per Share Amount | |||||||||||||||
Net income | $ | 59,467 | $ | 52,106 | |||||||||||||||||
Less net income associated with participating securities | 884 | 881 | |||||||||||||||||||
Basic earnings per share | $ | 58,583 | 47,747 | $ | 1.23 | 51,225 | 51,679 | $ | 0.99 | ||||||||||||
Diluted Earnings per Share: | |||||||||||||||||||||
Net income | $ | 59,467 | $ | 52,106 | |||||||||||||||||
Less net income associated with participating securities | 872 | 865 | |||||||||||||||||||
Effect of dilutive securities | 651 | 946 | |||||||||||||||||||
Diluted earnings per share | $ | 58,595 | 48,398 | $ | 1.21 | $ | 51,241 | 52,625 | $ | 0.97 |
5. | Equity and Incentive Compensation Plans |
Six Months Ended | ||||||
July 28, 2012 | ||||||
Shares | Weighted Average Exercise Price | |||||
Options outstanding at beginning of period | 4,498,817 | $ | 22.18 | |||
Granted (1) | 514,750 | 27.85 | ||||
Exercised | (827,049 | ) | 13.40 | |||
Forfeited or expired | (194,885 | ) | 27.46 | |||
Options outstanding at end of period | 3,991,633 | $ | 24.47 | |||
Vested and exercisable at July 28, 2012 | 2,822,658 | $ | 24.57 | |||
Options expected to vest in the future as of July 28, 2012 | 1,022,530 | $ | 24.32 |
(1) | Options vest annually over a three-year period and expire ten years after the grant date. |
Quarter Ended | Six Months Ended | ||||||||||
July 28, 2012 | July 30, 2011 | July 28, 2012 | July 30, 2011 | ||||||||
Expected volatility | — | % | 56.3 | % | 54.6 | % | 57.1 | % | |||
Risk-free interest rate | — | % | 1.6 | % | 0.9 | % | 1.8 | % | |||
Expected life (years) | — | 4.54 | 4.40 | 4.54 | |||||||
Dividend yield | — | — | — | — |
Time - Based | Performance - Based | ||||||||||||
Number of Shares | Weighted Average Grant Date Fair Value | Number of Shares | Weighted Average Grant Date Fair Value | ||||||||||
Restricted stock awards at January 28, 2012 | 523,096 | $ | 18.40 | 247,003 | $ | 17.13 | |||||||
Granted | 302,562 | (1) | 27.69 | 146,500 | (2) | 27.85 | |||||||
Vested | (316,089 | ) | 13.98 | (81,364 | ) | 10.44 | |||||||
Forfeited | (27,087 | ) | 25.12 | (94,467 | ) | 14.90 | |||||||
Restricted stock awards at July 28, 2012 | 482,482 | $ | 26.74 | 217,672 | $ | 27.81 |
(1) | Of this amount, 257,375 shares vest in equal installments in each of March 2013, 2014 and 2015, 4,000 shares vest in equal installments in each of March 2013 and 2014 and 41,187 shares vest in May 2013. |
(2) | These shares vest over a three-year period based on achievement of performance targets set bi-annually for each tranche of the grant. Based on Company performance, grantees may earn 50% to 150% of the shares granted with respect to each tranche. If the Company does not achieve the minimum threshold goal associated with such shares, grantees will not earn any shares with respect to that tranche. |
Time - Based | Performance - Based | ||||||||||||
Number of Shares | Weighted Average Grant Date Fair Value | Number of Shares | Weighted Average Grant Date Fair Value | ||||||||||
Restricted unit awards at January 28, 2012 | 175,353 | $ | 19.58 | 98,670 | $ | 19.58 | |||||||
Vested | (86,165 | ) | 19.58 | (27,871 | ) | 19.58 | |||||||
Forfeited | (7,836 | ) | 19.58 | (21,462 | ) | 19.58 | |||||||
Restricted unit awards at July 28, 2012 | 81,352 | $ | 19.58 | 49,337 | $ | 19.58 |
6. | Debt and Other Financing Arrangements |
7. | Employee Benefits |
Quarter Ended | Six Months Ended | ||||||||||||||
July 28, 2012 | July 30, 2011 | July 28, 2012 | July 30, 2011 | ||||||||||||
(in thousands) | (in thousands) | ||||||||||||||
Net periodic pension cost: | |||||||||||||||
Interest cost | $ | 438 | $ | 416 | $ | 875 | $ | 832 | |||||||
Expected return on plan assets | (378 | ) | (428 | ) | (755 | ) | (856 | ) | |||||||
Amortization of actuarial loss | 175 | 24 | 350 | 48 | |||||||||||
Net periodic pension cost | $ | 235 | $ | 12 | $ | 470 | $ | 24 |
8. | Securities Repurchase Program |
9. | Legal Proceedings |
• | Comparable sales – Comparable sales provide a measure of existing store sales performance. A store is included in comparable sales in its thirteenth month of operation. A store with a square footage change of greater than 15% is treated as a new store for the first year following its reopening. Sales from our Online Stores are also included in comparable sales. In a fiscal year with 53 weeks, sales in the last week of that year are excluded from comparable sales. |
• | Gross margin – Gross margin measures our ability to control the direct costs of merchandise sold during the period. Gross margin is the difference between net sales and cost of sales, which is comprised of direct inventory costs for merchandise sold, including all costs to transport merchandise from third-party suppliers to our distribution center. Buying and occupancy costs are excluded from cost of sales. |
• | Operating income – Because retailers do not uniformly record supply chain costs as a component of cost of sales or selling, general and administrative expenses, operating income allows us to benchmark our performance relative to other retailers. Operating income represents earnings before interest and income taxes and measures our earnings power from ongoing operations. |
• | Store productivity – Store productivity, including sales per square foot, average unit retail price ("AUR"), units per transaction ("UPT"), dollars per transaction ("DPT"), traffic and conversion, is evaluated by management in assessing our operating performance. |
• | Inventory turnover – Inventory turnover measures our ability to sell our merchandise and how many times it is replaced over time. This ratio is important in determining the need for markdowns, planning future inventory levels and assessing client response to our merchandise. |
• | Quality of merchandise offerings – To monitor and maintain client acceptance of our merchandise offerings, we monitor sell-through levels, inventory turnover, gross margin, returns and markdown rates at a class and style level. This analysis helps identify merchandise issues at an early date and helps us plan future product development and buying. |
Quarter Ended | Six Months Ended | ||||||||||
July 28, 2012 | July 30, 2011 | July 28, 2012 | July 30, 2011 | ||||||||
Net sales | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||
Cost of sales | 44.1 | % | 45.0 | % | 43.8 | % | 43.9 | % | |||
Gross margin | 55.9 | % | 55.0 | % | 56.2 | % | 56.1 | % | |||
Selling, general and administrative expenses | 47.0 | % | 47.5 | % | 47.7 | % | 48.0 | % | |||
Operating income | 8.9 | % | 7.5 | % | 8.5 | % | 8.1 | % | |||
Interest income | — | % | — | % | 0.1 | % | — | % | |||
Interest expense | 0.1 | % | 0.1 | % | 0.1 | % | 0.1 | % | |||
Income before income taxes | 8.8 | % | 7.4 | % | 8.5 | % | 8.0 | % | |||
Income tax provision | 3.7 | % | 2.9 | % | 3.3 | % | 3.2 | % | |||
Net income | 5.1 | % | 4.5 | % | 5.2 | % | 4.8 | % |
Quarter Ended | Six Months Ended | ||||||||||
July 28, 2012 | July 30, 2011 | July 28, 2012 | July 30, 2011 | ||||||||
Net sales | 6.6 | % | 15.5 | % | 6.8 | % | 12.7 | % | |||
Operating income | 27.0 | % | 39.4 | % | 12.2 | % | 27.7 | % | |||
Net income | 24.0 | % | 33.2 | % | 14.1 | % | 26.4 | % |
Quarter Ended | |||||||||||||
July 28, 2012 | July 30, 2011 | ||||||||||||
Sales | Comp % | Sales | Comp % | ||||||||||
Sales and Comps | ($ in thousands) | ||||||||||||
Ann Taylor brand | |||||||||||||
Ann Taylor Stores | $ | 122,593 | 3.2 | % | $ | 117,297 | 0.6 | % | |||||
Ann Taylor e-commerce | 29,096 | 29.0 | % | 22,597 | 32.0 | % | |||||||
Subtotal | 151,689 | 7.8 | % | 139,894 | 4.7 | % | |||||||
Ann Taylor Factory | 81,586 | 2.1 | % | 78,003 | 6.5 | % | |||||||
Total Ann Taylor brand | $ | 233,275 | 5.6 | % | $ | 217,897 | 5.3 | % | |||||
LOFT brand | |||||||||||||
LOFT Stores | $ | 272,989 | 4.1 | % | $ | 260,475 | 8.6 | % | |||||
LOFT e-commerce | 27,500 | 14.6 | % | 23,867 | 33.5 | % | |||||||
Subtotal | 300,489 | 5.0 | % | 284,342 | 10.3 | % | |||||||
LOFT Outlet | 61,108 | 0.3 | % | 55,962 | 23.7 | % | |||||||
Total LOFT brand | $ | 361,597 | 4.2 | % | $ | 340,304 | 11.0 | % | |||||
Total Company | $ | 594,872 | 4.7 | % | $ | 558,201 | 8.6 | % |
Six Months Ended | |||||||||||||
July 28, 2012 | July 30, 2011 | ||||||||||||
Sales | Comp % | Sales | Comp % | ||||||||||
Sales and Comps | ($ in thousands) | ||||||||||||
Ann Taylor brand | |||||||||||||
Ann Taylor Stores | $ | 232,190 | (6.6 | )% | $ | 242,676 | 7.0 | % | |||||
Ann Taylor e-commerce | 61,710 | 18.0 | % | 52,058 | 38.1 | % | |||||||
Subtotal | 293,900 | (1.9 | )% | 294,734 | 11.5 | % | |||||||
Ann Taylor Factory | 151,751 | 1.5 | % | 146,038 | 7.8 | % | |||||||
Total Ann Taylor brand | $ | 445,651 | (0.8 | )% | $ | 440,772 | 10.2 | % | |||||
LOFT brand | |||||||||||||
LOFT Stores | $ | 535,377 | 6.9 | % | $ | 499,574 | 3.8 | % | |||||
LOFT e-commerce | 63,986 | 22.4 | % | 52,160 | 33.1 | % | |||||||
Subtotal | 599,363 | 8.4 | % | 551,734 | 6.0 | % | |||||||
LOFT Outlet | 110,269 | 2.5 | % | 89,323 | 20.0 | % | |||||||
Total LOFT brand | $ | 709,632 | 7.5 | % | $ | 641,057 | 6.7 | % | |||||
Total Company | $ | 1,155,283 | 4.3 | % | $ | 1,081,829 | 8.2 | % |
Quarter Ended | Six Months Ended | ||||||||||||||
July 28, 2012 | July 30, 2011 | July 28, 2012 | July 30, 2011 | ||||||||||||
Sales Related Metrics | |||||||||||||||
Average Dollars Per Transaction ("DPT") | |||||||||||||||
Ann Taylor brand | $ | 76.50 | $ | 73.34 | $ | 79.44 | $ | 80.59 | |||||||
LOFT brand | 58.16 | 59.09 | 62.59 | 62.62 | |||||||||||
Average Units Per Transaction ("UPT") | |||||||||||||||
Ann Taylor brand | 2.37 | 2.40 | 2.36 | 2.42 | |||||||||||
LOFT brand | 2.64 | 2.68 | 2.66 | 2.64 | |||||||||||
Average Unit Retail ("AUR") | |||||||||||||||
Ann Taylor brand | $ | 32.28 | $ | 30.56 | $ | 33.66 | $ | 33.30 | |||||||
LOFT brand | 22.03 | 22.05 | 23.53 | 23.72 | |||||||||||
Net Sales Per Average Gross Square Foot (1) | |||||||||||||||
Ann Taylor Stores | $ | 86 | $ | 81 | $ | 162 | $ | 167 | |||||||
Ann Taylor Factory | 118 | 114 | 220 | 215 | |||||||||||
LOFT Stores | 94 | 89 | 185 | 171 | |||||||||||
LOFT Outlet | 113 | 116 | 208 | 221 |
(1) | Net sales per average gross square foot is determined by dividing net sales for the period by the average monthly gross square footage for the period. Unless otherwise indicated, references herein to square feet are to gross square feet, rather than net selling space. Sales from our Online Stores are excluded from the net sales per average gross square foot calculations. |
Quarter Ended | |||||||||||
July 28, 2012 | July 30, 2011 | ||||||||||
Stores | Square Feet | Stores | Square Feet | ||||||||
(square feet in thousands) | |||||||||||
Stores and Square Footage | |||||||||||
Ann Taylor brand | |||||||||||
Ann Taylor Stores | 277 | 1,419 | 272 | 1,446 | |||||||
Ann Taylor Factory | 100 | 691 | 97 | 691 | |||||||
Total Ann Taylor brand | 377 | 2,110 | 369 | 2,137 | |||||||
LOFT brand | |||||||||||
LOFT Stores | 505 | 2,929 | 501 | 2,920 | |||||||
LOFT Outlet | 80 | 555 | 72 | 506 | |||||||
Total LOFT brand | 585 | 3,484 | 573 | 3,426 | |||||||
Total Company | 962 | 5,594 | 942 | 5,563 | |||||||
Number Of: | |||||||||||
Stores open at beginning of period | 947 | 5,524 | 923 | 5,494 | |||||||
New stores (1) | 17 | 97 | 24 | 132 | |||||||
Downsized/expanded stores (2) | — | (16 | ) | — | (36 | ) | |||||
Closed stores | (2 | ) | (11 | ) | (5 | ) | (27 | ) | |||
Stores open at end of period | 962 | 5,594 | 942 | 5,563 |
Six Months Ended | |||||||||||
July 28, 2012 | July 30, 2011 | ||||||||||
Stores | Square Feet | Stores | Square Feet | ||||||||
(square feet in thousands) | |||||||||||
Stores and Square Footage | |||||||||||
Number Of: | |||||||||||
Stores open at beginning of period | 953 | 5,584 | 896 | 5,284 | |||||||
New stores (3) | 24 | 133 | 56 | 376 | |||||||
Downsized/expanded stores (4) | — | (41 | ) | — | (40 | ) | |||||
Closed stores | (15 | ) | (82 | ) | (10 | ) | (57 | ) | |||
Stores open at end of period | 962 | 5,594 | 942 | 5,563 |
(1) | During the quarter ended July 28, 2012, we opened three new Ann Taylor stores, one new Ann Taylor Factory store, seven new LOFT stores, and six new LOFT Outlet stores. During the quarter ended July 30, 2011, we opened seven new Ann Taylor stores, one new Ann Taylor Factory store, five new LOFT stores and 11 new LOFT Outlet stores. |
(2) | During the quarter ended July 28, 2012, we downsized six Ann Taylor stores and one Ann Taylor Factory store and expanded one Ann Taylor store. During the quarter ended July 30, 2011, we downsized six Ann Taylor stores and two Ann Taylor Factory stores. |
(3) | During the six months ended July 28, 2012, we opened five new Ann Taylor stores, one new Ann Taylor Factory store, 11 new LOFT stores, and seven new LOFT Outlet stores. During the six months ended July 30, 2011, we opened seven new Ann Taylor stores, five new Ann Taylor Factory stores, eight new LOFT stores and 36 new LOFT Outlet stores. |
(4) | During the six months ended July 28, 2012, we downsized nine Ann Taylor stores, four Ann Taylor Factory stores, one LOFT store and one LOFT Outlet store and expanded one Ann Taylor store. During the six months ended July 30, 2011, we downsized seven Ann Taylor stores and two Ann Taylor Factory stores. |
Quarter Ended | Six Months Ended | ||||||||||||||
July 28, 2012 | July 30, 2011 | July 28, 2012 | July 30, 2011 | ||||||||||||
(dollars in thousands) | |||||||||||||||
Cost of sales | $ | 262,471 | $ | 251,400 | $ | 505,511 | $ | 475,076 | |||||||
Gross margin | $ | 332,401 | $ | 306,801 | $ | 649,772 | $ | 606,753 | |||||||
Percentage of net sales | 55.9 | % | 55.0 | % | 56.2 | % | 56.1 | % |
Quarter Ended | Six Months Ended | ||||||||||||||
July 28, 2012 | July 30, 2011 | July 28, 2012 | July 30, 2011 | ||||||||||||
(dollars in thousands) | |||||||||||||||
Selling, general and administrative expenses | $ | 279,456 | $ | 265,125 | $ | 551,474 | $ | 519,158 | |||||||
Percentage of net sales | 47.0 | % | 47.5 | % | 47.7 | % | 48.0 | % |
Quarter Ended | Six Months Ended | ||||||||||||
July 28, 2012 | July 30, 2011 | July 28, 2012 | July 30, 2011 | ||||||||||
(dollars in thousands) | |||||||||||||
Income tax provision | $ | 21,826 | $ | 16,451 | 38,667 | 35,011 | |||||||
Effective income tax rate | 41.5 | % | 39.9 | % | 39.4 | % | 40.2 | % |
July 28, 2012 | January 28, 2012 | July 30, 2011 | |||||||||
(dollars in thousands) | |||||||||||
Working capital | $ | 161,450 | $ | 189,420 | $ | 216,161 | |||||
Current ratio | 1.49:1 | 1.66:1 | 1.75:1 |
Total Number of Shares Purchased (1) | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Program (2) | Approximate Dollar Value of Shares that May Yet Be Purchased Under Publicly Announced Program | ||||||||||
(in thousands) | |||||||||||||
April 29, 2012 to May 26, 2012 | 1,047 | $ | 27.97 | — | $ | 149,084 | |||||||
May 27, 2012 to June 30, 2012 | 1,556,072 | 24.69 | 1,555,600 | 110,674 | |||||||||
July 1, 2012 to July 28, 2012 | 65,726 | 24.44 | 65,118 | 109,084 | |||||||||
1,622,845 | 1,620,718 |
(1) | Includes 2,127 shares of restricted stock purchased in connection with employee tax withholding obligations under the employee equity compensation plans, which are not purchases under the Company’s publicly announced program. |
(2) | On March 8, 2011, our Board of Directors approved a $200 million expansion of our existing securities repurchase program (the “Repurchase Program”) to a total of $600 million. The Repurchase Program will expire when we have repurchased all securities authorized for repurchase thereunder, unless terminated earlier by our Board of Directors. We purchased 1,620,718 shares under the Repurchase Program during the second quarter of Fiscal 2012 and 3,081,430 shares during the first six months of Fiscal 2012. As of July 28, 2012 and August 17, 2012, the date of this filing, approximately $109.1 million remained available for future repurchases under the Repurchase Program. |
Exhibit Number | Description |
10.1*† | Amended and Restated ANN INC. Management Performance Compensation Plan. |
10.2*† | Summary of Compensation Arrangements for Non-Employee Directors |
31.1* | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
31.2* | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
32.1° | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
101.INS | XBRL Instance |
101.SCH | XBRL Taxonomy Extension Schema |
101.CAL | XBRL Taxonomy Extension Calculation |
101.DEF | XBRL Taxonomy Extension Definition |
101.LAB | XBRL Taxonomy Extension Labels |
101.PRE | XBRL Taxonomy Extension Presentation |
* | Filed electronically herewith. |
° | Furnished electronically herewith. |
† | Management contract or compensatory plan or arrangement. |
ANN INC. | |||
Date: | August 17, 2012 | By: | /s/ Kay Krill |
Kay Krill | |||
President and Chief Executive Officer | |||
(Principal Executive Officer) |
Date: | August 17, 2012 | By: | /s/ Michael J. Nicholson |
Michael J. Nicholson | |||
Executive Vice President, | |||
Chief Financial Officer and Treasurer | |||
(Principal Financial Officer) |
Exhibit Number | Description | |
10.1*† | Amended and Restated ANN INC. Management Performance Compensation Plan. | |
10.2*† | Summary of Compensation Arrangements for Non-Employee Directors | |
31.1* | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.2* | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
32.1° | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
101.INS | XBRL Instance | |
101.SCH | XBRL Taxonomy Extension Schema | |
101.CAL | XBRL Taxonomy Extension Calculation | |
101.DEF | XBRL Taxonomy Extension Definition | |
101.LAB | XBRL Taxonomy Extension Labels | |
101.PRE | XBRL Taxonomy Extension Presentation |
* | Filed electronically herewith. |
° | Furnished electronically herewith. |
† | Management contract or compensatory plan or arrangement. |
(a) | “Board” means the Board of Directors of the Company. |
(b) | “Budget” means the Company's operating budget for a Performance Period. |
(c) | A “Change in Control” shall be deemed to have occurred if: |
(d) | “Committee” means the Compensation Committee of the Board, as appointed by the Board from time to time and consisting of not less than two directors, at least two of whom must be “outside directors” within the meaning of Section 162(m). All actions taken by the Committee under this Plan with respect to Section 162(m) Officers shall be taken solely by those members of the Committee who are “outside directors”, even if less than a majority of the Committee, and such members shall constitute a subcommittee for purposes of Section 162(m). With respect to Eligible Associates are not |
(e) | “Company” means ANN INC. |
(f) | “Eligible Associate” has the meaning assigned thereto in Section 3 hereof. |
(g) | “Executive Officer” means an officer of the Company who is an “executive officer” within the meaning of Rule 3b-7 promulgated under the Securities Exchange Act of 1934 (the “Exchange Act”). |
(h) | “Participant” means an Eligible Associate who has been designated as a Participant by the Committee in accordance with Section 4 of this Plan. |
(i) | “Performance Compensation” means the cash amount payable to a Participant pursuant to this Plan; provided that the Committee may determine from time to time that all or a portion of amounts payable to a Participant or Participants pursuant to the Plan shall be made in the form of shares of the Company's common stock reserved for issuance under the Company's 2003 Equity Incentive Plan, as amended, or any successor plan that has been approved by the Company's shareholders. |
(j) | “Performance Goals” has the meaning assigned thereto in Section 5(b) hereof. |
(k) | “Performance Percentage” and “Performance Ratio” have the meanings assigned thereto in Section 5(a) hereof. |
(l) | “Performance Period” means a period designated by the Committee during which Performance Compensation will be earned. A Performance Period may range in length from the six-month period that coincides with the Company's fiscal six-month Spring or Fall season to the twelve-month period that coincides with the Company's fiscal year. |
(m) | “Plan” means this ANN INC. Management Performance Compensation Plan. |
(n) | “Subsidiary” means any corporation of which the Company owns, directly or indirectly, at least majority of the outstanding voting capital stock. |
(o) | “Section 162(m) Officer” for a particular year, means an Executive Officer who is a “Covered Employee” within the meaning of Section 162(m) of the Code for such year. |
(a) | As promptly as possible after the Company's Budget for a Performance Period shall have become available, and after having received the recommendations of the Company's Chief Executive Officer pursuant to Section 4(b) below, the Committee shall designate from among all Eligible Associates those who shall be Participants under this Plan for such Performance Period. |
(b) | Prior to the beginning of a Performance Period, or by such later date permissible under Section 162(m), and after the Company's Budget for a Performance Period shall have become available, the Chief Executive Officer of the Company shall submit to the Committee a list of the names, titles, salaries and suggested Performance Percentages of those Eligible Associates whom the Chief Executive Officer recommends that the Committee designate as Participants under this Plan for such Performance Period. |
(c) | The Committee shall have the authority to designate from time to time prior to the commencement of as well as during a Performance Period additional Eligible Associates as Participants under this Plan for such Performance Period. |
(d) | In selecting from among all Eligible Associates those who shall become Participants in any Performance Period and in determining the Performance Percentages of such Participants for such Performance Period, the Committee shall consider the position and responsibilities of the Eligible Associates, the value of their services to the Company and such other factors as the Committee deems relevant. |
(a) | At the time the Committee selects Participants under this Plan for a Performance Period, or within such other time period which may comply with Section 162(m), the Committee shall, for each Participant: |
(b) | As used in this Plan, “Performance Goals” means the specific objectives established by the Committee for each Participant for a Performance Period. In setting these objectives, the Committee shall consider one or more of the following business criteria: revenue; net or gross sales; comparable store sales; net income; gross margin; operating profit (corporate and/or divisional); earnings before all or any of interest, taxes, depreciation and/or amortization; cash flow; cash on the balance sheet; working capital; return on equity, assets, capital or investment; market share; sales (net or gross) measured by store, product line, territory, operating or business unit, customers, or other category; earnings or book value per share of the Company's common stock; earnings from continuing operations; net worth; turnover or shrinkage in inventory; levels of expense, cost or liability by store, product line, territory, operating or business unit or other category; appreciation in the price of shares of the Company's common stock; total shareholder return (stock price appreciation plus dividends); any other Generally Accepted Accounting Principles (“GAAP”) financial measures; implementation of critical projects or processes consisting of one or more objectives based on meeting specified market penetration, geographical business expansion, customer satisfaction, employee satisfaction, human resources management, supervision of litigation, information technology, and goals relating to acquisitions, divestitures, joint ventures and similar transactions and budget comparisons; and personal professional objectives, including any of the foregoing performance goals, the implementation of policies and plans, the negotiation of transactions, the development of long term business goals, formation of joint ventures, research or development collaborations, and the completion of other corporate transactions. Where applicable, the performance goals may be expressed in terms of attaining a specified level of the selected criterion or the attainment of a percentage increase or decrease in the selected criterion, or may be applied to the performance of the Company relative to a market index, a group of other companies or a combination thereof, all as determined by the Compensation Committee. Such Performance Goals may relate to the performance of a store, business unit, product line, division, territory, the Company or an individual or any combination thereof. With respect to Participants who are not Section 162(m) Officers, Performance Goals may also include such individual objective or subjective performance criteria as the Committee may, from time to time, establish. Performance Goals may include a threshold level of performance below which no award payment shall be made and levels of performance at which specified percentages of the target award shall be paid, and may also include a maximum level of performance above which no additional award shall be paid. Each of the foregoing Performance Goals shall be determined in accordance with generally acceptable accounting principles and, for Section 162(m) Officers, shall be subject to certification by the Committee. The Performance Goals established by the Committee may be different with respect to different Participants, different Performance Periods and/or different operations. |
(c) | Subject to adjustment pursuant to Section 5(d) below, unless otherwise determined by the Committee, a Participant's Performance Compensation for the Performance Period for which he or she was designated by the Committee as a Participant pursuant to Section 4 hereof shall be equal to the product of (i) the Participant's annual base salary for the fiscal year of which such Performance Period is a part (prorated, as to any Participant who shall have become an Eligible Associate and designated as a Participant after |
(d) | For any Performance Period, the Board may establish a ceiling on the aggregate amount which may be paid out in Performance Compensation for such Performance Period. In the event that such a limit is established for any Performance Period, the Performance Compensation otherwise payable to all Participants for such Performance Period pursuant to Section 5(c) above shall be reduced pro rata. Notwithstanding any other provision of the Plan, no Participant who is a Section 162(m) Officer may receive Performance Compensation for a twelve-month Performance Period in excess of $6,000,000, such amount to be reduced proportionately for Performance Periods of shorter duration. |
(e) | Performance Compensation shall be paid by the Company or the Subsidiary employing the Participant promptly following the end of the Performance Period to which it relates, or at such other time as may be determined by the Committee at the time the award is made. The foregoing notwithstanding, no payment of Performance Compensation for a Performance Period may be made to a Section 162(m) Officer until the performance results for that Performance Period are certified by the Committee. A Participant shall not be entitled to receive payment of Performance Compensation unless such Participant is still in the employ of (and shall not have delivered notice of resignation to) the Company or one of its Subsidiaries at the time the Performance Compensation is actually paid, except as otherwise determined by the Committee at the time the award is made. All Performance Compensation shall be paid not later than the last day of the “applicable 2 1/2 month period”, as such term is defined in Treasury Regulation § 1.409A-1(b)(4)(i)(A). |
(f) | Notwithstanding the preceding provisions of this Section 5, in the event of a Change in Control, a pro rata cash payment, in cancellation of outstanding awards in respect of the Performance Period in effect as of the date of the Change in Control, shall be made to each Participant within thirty (30) business days following the date of the Change in Control. The pro rata payment to such Participant with respect to such Performance Period shall be calculated by multiplying (X) and (Y), where (X) equals the amount to which the Participant would have been entitled had the Performance Period been completed, assuming for this purpose that all Performance Goals applicable to the Participant were achieved at a level equating to a Performance Ratio of 100% and (Y) equals a fraction, the numerator of which is the number of full and partial months in such Performance Period that have elapsed as of the date of the Change in Control and the denominator of which is the number of months in the complete Performance Period. |
(a) | No person shall at any time have any right to receive Performance Compensation hereunder, unless such person shall have been designated as a Participant by the Committee pursuant to Section 4 hereof and the other terms and conditions of this Plan shall have been satisfied. No person shall have authority to enter into any agreement for the inclusion of anyone as a Participant or the awarding of Performance Compensation hereunder or to make any representation or warranty with respect thereto. Designation of an Eligible Associate as a Participant in any Performance Period shall not guarantee or require that such Eligible Associate be designated as a Participant in any later Performance Period. |
(b) | No action of the Company or the Board in establishing this Plan, nor any action taken by the Company, the Board or the Committee under this Plan, nor any provision of this Plan, shall be construed as conferring upon any associate any right to continued employment for any period by the Company or any of its Subsidiaries, or shall interfere in any way with the right of the Company or any Subsidiary to terminate such employment. |
1. | I have reviewed this quarterly report on Form 10-Q of ANN INC.; |
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. |
1. | I have reviewed this quarterly report on Form 10-Q of ANN INC.; |
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. |
(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. |
Employee Benefits - Summary of Components of Net Periodic Pension Cost (Detail) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jul. 28, 2012
|
Jul. 30, 2011
|
Jul. 28, 2012
|
Jul. 30, 2011
|
|
Net periodic pension cost: | ||||
Interest cost | $ 438 | $ 416 | $ 875 | $ 832 |
Expected return on plan assets | (378) | (428) | (755) | (856) |
Amortization of actuarial loss | 175 | 24 | 350 | 48 |
Net periodic pension cost | $ 235 | $ 12 | $ 470 | $ 24 |
Fair Value Measurements
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Jul. 28, 2012
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Notes to Financial Statements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Fair Value Measurements ASC 820-10, Fair Value Measurements and Disclosures, establishes a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:
The following tables segregate all financial assets and liabilities of the Company that are measured at fair value on a recurring basis into the most appropriate level within the fair value hierarchy based on the inputs used to determine fair value at the measurement date:
At July 28, 2012, the Company believes that the carrying value of cash and cash equivalents, receivables and payables approximates fair value, due to the short maturity of these financial instruments. |