EX-99.1 2 a08-26998_1ex99d1.htm EX-99.1

Exhibit 99.1

 

FOR IMMEDIATE RELEASE

 

 

CONTACT:

 

Stephanie Bowman

 

 

 

Chief Financial Officer

 

 

 

TUESDAY MORNING CORPORATION

 

 

 

972-934-7251

 

 

 

 

 

 

 

Laurey Peat

 

 

 

LAUREY PEAT + ASSOCIATES

 

 

 

214/871-8787

 

TUESDAY MORNING CORPORATION

 

ANNOUNCES FIRST QUARTER FISCAL 2009 RESULTS

 

DALLAS, TX – October 28, 2008 — Tuesday Morning Corporation (NASDAQ: TUES) today reported that as previously announced, net sales for the first quarter of fiscal 2009 were $173.4 million compared to $201.7 million for the quarter ended September 30, 2007, a decrease of 14.0%.  Comparable store sales decreased 17.3% for the quarter.  The decrease in comparable store sales was comprised of a 14.0% decrease in traffic and a 3.3% decrease in average ticket.  Net loss for the first quarter ended September 30, 2008 was $4.3 million or ($0.10) per diluted share, compared to net income of $1.2 million or $0.03 per diluted share for the same period last year.

 

Kathleen Mason, President and Chief Executive Officer, stated, “Disposable income continues to be pressured by tight credit, food and fuel inflation, declining home values, and losses in investment accounts. Consumers are cutting back non-essential purchases.  Also, Tuesday Morning stores were impacted by the effects of two hurricanes that reduced sales by approximately $4.2 million and earnings per share by approximately $.02 during the quarter.  Despite these pressures, we controlled inventory and expenses to partially offset the decline in demand.  We remain focused on achieving annual profits and maintaining our strong balance sheet.”

 

Guidance for the fiscal year ending on June 30, 2009 is as follows:

 

·                  net sales are projected to be in the range of $854 million to $859 million;

·                  comparable store sales are projected to be in the negative mid single digits; and

·                  diluted earnings per share projected to be in the range of $0.19 to $0.21.

 

Tuesday Morning management will review first quarter fiscal 2009 financial results in a teleconference call on October 28, 2008 at 10:00 a.m. Eastern Time.

 

About Tuesday Morning

 

Tuesday Morning is a leading closeout retailer of upscale, decorative home accessories, housewares and famous-maker gifts in the United States. The Company opened its first store in 1974 and currently operates 851 stores in 45 states. Tuesday Morning is nationally known for bringing its more than 9.0 million loyal customers a unique treasure hunt of high-end, first quality, brand name merchandise...never seconds or irregulars...at prices well below those of department and specialty stores and catalogues.

 

This press release contains forward-looking statements within the meaning of the federal securities laws and the Private Securities Litigation Reform Act of 1995, which are based on management’s current expectations, estimates and projections.  Forward-looking statements typically are identified by the use of terms such as “may,” “will,” “should,” “expect,” “anticipate,” “believe,” “estimate,” “intend” and similar words, although some forward-looking statements are expressed differently.  You should carefully consider statements that contain these words because they describe our expectations, plans, strategies and goals and our

 


 

beliefs concerning future business conditions, our future results of operations, our future financial positions, and our business outlook or state other “forward-looking” information.

 

Reference is hereby made to “Item 1A.  Risk Factors” of the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2008 for examples of risks, uncertainties and events that could cause our actual results to differ materially from the expectations expressed in our forward-looking statements.  These risks, uncertainties and events also include, but are not limited to, the following:  uncertainties regarding our ability to open stores in new and existing markets and operate these stores on a profitable basis; conditions affecting consumer spending; inclement weather; changes in our merchandise mix; timing and type of sales events, promotional activities and other advertising; increased or new competition; loss or departure of one or more members of our senior management, as well as experienced buying and management personnel; an increase in the cost or a disruption in the flow of our products; seasonal and quarterly fluctuations; fluctuations in our comparable store results; our ability to operate information systems and implement new technologies effectively; our ability to generate strong cash flows from our operations; our ability to maintain internal control over financial reporting; our ability to anticipate and respond in a timely manner to changing consumer demands and preferences;  and our ability to generate strong holiday season sales.  The forward-looking statements made in this press release relate only to events as of the date on which the statements were made.  We undertake no obligations to update our forward-looking statements to reflect events and circumstances after the date on which the statements were made or to reflect the occurrence of unanticipated events.

 

# # #

 


 

Tuesday Morning Corporation

Consolidated Statement of Income (unaudited)

(In thousands, except per share data)

 

 

 

Three Months Ended September 30,

 

 

 

2008

 

2007

 

 

 

 

 

 

 

Net Sales

 

$

173,401

 

$

201,656

 

Cost of sales

 

109,245

 

125,947

 

Gross profit

 

64,156

 

75,709

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

70,910

 

72,544

 

 

 

 

 

 

 

Operating income (loss)

 

(6,754

)

3,165

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

Interest expense

 

(411

)

(1,686

)

Interest income

 

—

 

1

 

Other income (expense), net

 

80

 

377

 

Other income (expense)

 

(331

)

(1,308

)

 

 

 

 

 

 

Income before income taxes

 

(7,085

)

1,857

 

 

 

 

 

 

 

Income tax expense (benefit)

 

(2,788

)

701

 

 

 

 

 

 

 

Net income (loss)

 

$

(4,297

)

$

1,156

 

 

 

 

 

 

 

Earnings (Loss) Per Share:

 

 

 

 

 

Net income (loss) per common share:

 

 

 

 

 

Basic

 

$

(0.10

)

$

0.03

 

Diluted

 

$

(0.10

)

$

0.03

 

 

 

 

 

 

 

Weighted average number of common shares:

 

 

 

 

 

Basic

 

41,441

 

41,440

 

Diluted

 

41,441

 

41,585

 

 


 

Consolidated Balance Sheets (unaudited)

(in thousands)

 

 

 

September 30,

 

September 30,

 

June 30,

 

 

 

2008

 

2007

 

2008

 

Assets

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

4,888

 

$

11,918

 

$

8,630

 

Inventories

 

307,081

 

346,017

 

240,996

 

Prepaid expenses and other assets

 

11,847

 

9,991

 

11,292

 

Income tax receivable

 

8,952

 

—

 

—

 

Total current assets

 

332,768

 

367,926

 

260,918

 

 

 

 

 

 

 

 

 

Property and Equipment, net

 

76,601

 

82,432

 

77,315

 

 

 

 

 

 

 

 

 

Other long-term assets:

 

 

 

 

 

 

 

Deferred financing costs

 

453

 

654

 

503

 

Other assets

 

2,519

 

3,679

 

3,040

 

 

 

 

 

 

 

 

 

Total Assets

 

$

412,341

 

$

454,691

 

$

341,776

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

Current portion of long term debt

 

$

6,500

 

$

74,000

 

$

—

 

Accounts payable

 

106,175

 

90,334

 

63,899

 

Accrued liabilities

 

30,821

 

32,555

 

28,595

 

Deferred Income Taxes

 

267

 

1,372

 

267

 

Income taxes payable

 

1,612

 

441

 

27

 

Total current liabilities

 

145,375

 

198,702

 

92,788

 

 

 

 

 

 

 

 

 

Revolving credit facility, excl. current portion

 

30,000

 

30,000

 

8,500

 

Deferred rent

 

4,127

 

4,542

 

4,163

 

Deferred income taxes

 

3,414

 

3,582

 

3,414

 

Total Liabilities

 

182,916

 

236,826

 

108,865

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

229,425

 

217,865

 

232,911

 

Total Liabilities and Stockholders’ Equity

 

$

412,341

 

$

454,691

 

$

341,776

 

 


 

Tuesday Morning Corporation (continued)

Consolidated Statement of Cash Flows (unaudited)

(in thousands)

 

 

 

Three Months

 

Three Months

 

 

 

Ended September 30,

 

Ended September 30,

 

 

 

2008

 

2007

 

 

 

 

 

 

 

Net cash flows from operating activities:

 

 

 

 

 

Net income (loss)

 

$

(4,297

)

$

1,156

 

Adjustments to reconcile net income to net cash (used in) operating activities:

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

4,212

 

4,442

 

Amortization of financing fees

 

50

 

50

 

Deferred income taxes

 

—

 

2,706

 

Loss on disposal of assets

 

139

 

169

 

Stock compensation expense

 

709

 

1,342

 

Other non-cash charges

 

(44

)

66

 

Net change in operating assets and liabilities

 

(25,210

) 

(55,702

)

 

 

 

 

 

 

Net cash used in operating activities

 

(24,441

)

(45,771

)

 

 

 

 

 

 

Net cash flows from investing activities:

 

 

 

 

 

Capital expenditures

 

(3,637

)

(3,267

)

 

 

 

 

 

 

Net cash used in investing activities

 

(3,637

)

(3,267

)

 

 

 

 

 

 

Net cash flows from financing activities:

 

 

 

 

 

Borrowings under the revolving credit facility

 

63,000

 

82,500

 

Repayments under the revolving credit facility

 

(35,000

)

(35,000

)

Change in cash overdraft

 

(3,665

)

3,157

 

Proceeds from exercise of common stock options and stock purchase plan purchases

 

1

 

(4

)

 

 

 

 

 

 

Net cash provided by financing activities

 

24,336

 

50,653

 

 

 

 

 

 

 

Net decrease in cash and cash equivalents

 

(3,742

)

1,615

 

 

 

 

 

 

 

Cash and cash equivalents, beginning of period

 

8,630

 

10,303

 

 

 

 

 

 

 

Cash and cash equivalents, end of period

 

$

4,888

 

$

11,918