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 April 30, 2011 | |||
o |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
|
||
THE SECURITIES EXCHANGE ACT OF 1934 | |||
For the Transition Period from ____________ to ____________
|
|||
Commission File Number: 001-12951 | |||
THE BUCKLE, INC.
|
|||
(Exact name of Registrant as specified in its charter)
|
Nebraska
|
47-0366193
|
||
(State or other jurisdiction of
|
(I.R.S. Employer
|
||
incorporation or organization)
|
Identification No.)
|
2407 West 24th Street, Kearney, Nebraska 68845-4915
|
||
(Address of principal executive offices) (Zip Code)
|
Registrant's telephone number, including area code: (308) 236-8491
|
Securities registered pursuant to Section 12(b) of the Act:
|
Title of class
|
Name of Each Exchange on Which Registered
|
||
Common Stock, $.01 par value
|
New York Stock Exchange
|
Securities registered pursuant to Section 12(g) of the Act: None
|
||
___________________________________________________________
|
||
(Former name, former address, and former fiscal year if changed since last report)
|
þ Large accelerated filer; o Accelerated filer; o Non-accelerated filer; o Smaller Reporting Company
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THE BUCKLE, INC. | |||
FORM 10-Q | |||
INDEX
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|||
Pages
|
|||
|
3
|
||
|
17
|
||
|
25
|
||
|
25
|
||
|
26
|
||
26
|
|||
|
26
|
||
26
|
|||
|
26
|
||
|
26
|
||
|
26
|
||
|
27
|
BALANCE SHEETS
|
||||||||
(Amounts in Thousands Except Share and Per Share Amounts)
|
||||||||
(Unaudited)
|
||||||||
April 30,
|
January 29,
|
|||||||
ASSETS
|
2011
|
2011
|
||||||
CURRENT ASSETS:
|
||||||||
Cash and cash equivalents
|
$ | 139,292 | $ | 116,470 | ||||
Short-term investments
|
21,497 | 22,892 | ||||||
Receivables
|
4,051 | 14,363 | ||||||
Inventory
|
89,866 | 88,593 | ||||||
Prepaid expenses and other assets
|
22,876 | 14,718 | ||||||
Total current assets
|
277,582 | 257,036 | ||||||
PROPERTY AND EQUIPMENT
|
347,959 | 342,413 | ||||||
Less accumulated depreciation and amortization
|
(178,103 | ) | (173,179 | ) | ||||
169,856 | 169,234 | |||||||
LONG-TERM INVESTMENTS
|
65,179 | 66,162 | ||||||
OTHER ASSETS
|
2,416 | 2,412 | ||||||
$ | 515,033 | $ | 494,844 | |||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
CURRENT LIABILITIES:
|
||||||||
Accounts payable
|
$ | 41,076 | $ | 33,489 | ||||
Accrued employee compensation
|
15,278 | 36,018 | ||||||
Accrued store operating expenses
|
9,323 | 9,653 | ||||||
Gift certificates redeemable
|
12,914 | 17,213 | ||||||
Income taxes payable
|
9,796 | - | ||||||
Total current liabilities
|
88,387 | 96,373 | ||||||
DEFERRED COMPENSATION
|
8,734 | 7,727 | ||||||
DEFERRED RENT LIABILITY
|
37,617 | 37,430 | ||||||
OTHER LIABILITIES
|
7,421 | 7,649 | ||||||
Total liabilities
|
142,159 | 149,179 | ||||||
COMMITMENTS
|
||||||||
STOCKHOLDERS’ EQUITY:
|
||||||||
Common stock, authorized 100,000,000 shares of $.01 par value; 47,342,895 and 47,127,926
|
||||||||
shares issued and outstanding at April 30, 2011 and January 29, 2011, respectively
|
474 | 471 | ||||||
Additional paid-in capital
|
92,900 | 89,719 | ||||||
Retained earnings
|
280,150 | 256,146 | ||||||
Accumulated other comprehensive loss
|
(650 | ) | (671 | ) | ||||
Total stockholders’ equity
|
372,874 | 345,665 | ||||||
$ | 515,033 | $ | 494,844 | |||||
See notes to unaudited condensed financial statements.
|
THE BUCKLE, INC.
|
||||||||
STATEMENTS OF INCOME
|
||||||||
(Amounts in Thousands Except Per Share Amounts)
|
||||||||
(Unaudited)
|
||||||||
Thirteen Weeks Ended
|
||||||||
April 30,
|
May 1,
|
|||||||
2011
|
2010
|
|||||||
SALES, Net of returns and allowances
|
$ | 240,092 | $ | 214,797 | ||||
COST OF SALES (Including buying, distribution, and occupancy costs)
|
137,148 | 121,346 | ||||||
Gross profit
|
102,944 | 93,451 | ||||||
OPERATING EXPENSES:
|
||||||||
Selling
|
42,731 | 39,843 | ||||||
General and administrative
|
8,859 | 7,421 | ||||||
51,590 | 47,264 | |||||||
INCOME FROM OPERATIONS
|
51,354 | 46,187 | ||||||
OTHER INCOME, Net
|
1,612 | 1,833 | ||||||
INCOME BEFORE INCOME TAXES
|
52,966 | 48,020 | ||||||
PROVISION FOR INCOME TAXES
|
19,497 | 17,910 | ||||||
NET INCOME
|
$ | 33,469 | $ | 30,110 | ||||
EARNINGS PER SHARE:
|
||||||||
Basic
|
$ | 0.72 | $ | 0.65 | ||||
Diluted
|
$ | 0.71 | $ | 0.64 | ||||
Basic weighted average shares
|
46,748 | 46,053 | ||||||
Diluted weighted average shares
|
47,264 | 46,993 | ||||||
See notes to unaudited condensed financial statements.
|
THE BUCKLE, INC.
|
||||||||||||||||||||||||
STATEMENTS OF STOCKHOLDERS' EQUITY
|
||||||||||||||||||||||||
(Dollar Amounts in Thousands Except Share and Per Share Amounts)
|
||||||||||||||||||||||||
(Unaudited)
|
||||||||||||||||||||||||
Accumulated
|
||||||||||||||||||||||||
Additional
|
Other
|
|||||||||||||||||||||||
Number
|
Common
|
Paid-in
|
Retained
|
Comprehensive
|
||||||||||||||||||||
of Shares
|
Stock
|
Capital
|
Earnings
|
Loss
|
Total
|
|||||||||||||||||||
FISCAL 2011
|
||||||||||||||||||||||||
BALANCE, January 30, 2011
|
47,127,926 | $ | 471 | $ | 89,719 | $ | 256,146 | $ | (671 | ) | $ | 345,665 | ||||||||||||
Net income
|
- | - | - | 33,469 | - | 33,469 | ||||||||||||||||||
Dividends paid on common stock,
|
||||||||||||||||||||||||
($0.20 per share)
|
- | - | - | (9,465 | ) | - | (9,465 | ) | ||||||||||||||||
Common stock issued on exercise
|
||||||||||||||||||||||||
of stock options
|
83,819 | 1 | 512 | - | - | 513 | ||||||||||||||||||
Issuance of non-vested stock, net of forfeitures
|
131,150 | 2 | (2 | ) | - | - | - | |||||||||||||||||
Amortization of non-vested stock grants,
|
||||||||||||||||||||||||
net of forfeitures
|
- | - | 1,621 | - | - | 1,621 | ||||||||||||||||||
Income tax benefit related to exercise of
|
||||||||||||||||||||||||
stock options
|
- | - | 1,050 | - | - | 1,050 | ||||||||||||||||||
Unrealized loss on investments, net of tax
|
- | - | - | - | 21 | 21 | ||||||||||||||||||
BALANCE, April 30, 2011
|
47,342,895 | $ | 474 | $ | 92,900 | $ | 280,150 | $ | (650 | ) | $ | 372,874 | ||||||||||||
FISCAL 2010
|
||||||||||||||||||||||||
BALANCE, January 31, 2010
|
46,381,263 | $ | 464 | $ | 78,837 | $ | 275,751 | $ | (793 | ) | $ | 354,259 | ||||||||||||
Net income
|
- | - | - | 30,110 | - | 30,110 | ||||||||||||||||||
Dividends paid on common stock,
|
||||||||||||||||||||||||
($0.20 per share)
|
- | - | - | (9,337 | ) | - | (9,337 | ) | ||||||||||||||||
Common stock issued on exercise
|
||||||||||||||||||||||||
of stock options
|
101,463 | 1 | 470 | - | - | 471 | ||||||||||||||||||
Issuance of non-vested stock, net of forfeitures
|
243,765 | 2 | (2 | ) | - | - | - | |||||||||||||||||
Amortization of non-vested stock grants,
|
||||||||||||||||||||||||
net of forfeitures
|
- | - | 1,500 | - | - | 1,500 | ||||||||||||||||||
Stock option compensation expense
|
- | - | 16 | - | - | 16 | ||||||||||||||||||
Income tax benefit related to exercise of
|
||||||||||||||||||||||||
stock options
|
- | - | 1,211 | - | - | 1,211 | ||||||||||||||||||
Unrealized loss on investments, net of tax
|
- | - | - | - | 34 | 34 | ||||||||||||||||||
BALANCE, May 1, 2010
|
46,726,491 | $ | 467 | $ | 82,032 | $ | 296,524 | $ | (759 | ) | $ | 378,264 | ||||||||||||
See notes to unaudited condensed financial statements.
|
THE BUCKLE, INC.
|
||||||||
STATEMENTS OF CASH FLOWS
|
||||||||
(Dollar Amounts in Thousands)
|
||||||||
(Unaudited)
|
||||||||
Thirteen Weeks Ended
|
||||||||
April 30,
|
May 1,
|
|||||||
2011
|
2010
|
|||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||
Net income
|
$ | 33,469 | $ | 30,110 | ||||
Adjustments to reconcile net income to net cash flows
|
||||||||
from operating activities:
|
||||||||
Depreciation and amortization
|
7,500 | 6,490 | ||||||
Amortization of non-vested stock grants, net of forfeitures
|
1,621 | 1,500 | ||||||
Stock option compensation expense
|
- | 16 | ||||||
Deferred income taxes
|
(600 | ) | (562 | ) | ||||
Other
|
311 | 11 | ||||||
Changes in operating assets and liabilities:
|
||||||||
Receivables
|
1,580 | 759 | ||||||
Inventory
|
(1,273 | ) | 3,446 | |||||
Prepaid expenses and other assets
|
(7,865 | ) | (7,352 | ) | ||||
Accounts payable
|
9,744 | 11,177 | ||||||
Accrued employee compensation
|
(20,740 | ) | (24,765 | ) | ||||
Accrued store operating expenses
|
(330 | ) | (474 | ) | ||||
Gift certificates redeemable
|
(4,299 | ) | (3,266 | ) | ||||
Income taxes payable
|
18,620 | 15,384 | ||||||
Deferred rent liabilities and deferred compensation
|
1,194 | 1,138 | ||||||
Net cash flows from operating activities
|
38,932 | 33,612 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
||||||||
Purchase of property and equipment
|
(10,590 | ) | (20,700 | ) | ||||
Proceeds from sale of property and equipment
|
- | 14 | ||||||
Change in other assets
|
(4 | ) | - | |||||
Purchases of investments
|
(2,107 | ) | (15,240 | ) | ||||
Proceeds from sales/maturities of investments
|
4,519 | 6,088 | ||||||
Net cash flows from investing activities
|
(8,182 | ) | (29,838 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||
Proceeds from the exercise of stock options
|
513 | 471 | ||||||
Excess tax benefit from stock option exercises
|
1,024 | 1,169 | ||||||
Payment of dividends
|
(9,465 | ) | (9,337 | ) | ||||
Net cash flows from financing activities
|
(7,928 | ) | (7,697 | ) | ||||
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
22,822 | (3,923 | ) | |||||
CASH AND CASH EQUIVALENTS, Beginning of period
|
116,470 | 135,340 | ||||||
CASH AND CASH EQUIVALENTS, End of period
|
$ | 139,292 | $ | 131,417 | ||||
See notes to unaudited condensed financial statements.
|
Management Representation
|
Description of the Business
|
Percentage of Net Sales
|
||||||||
Thirteen Weeks Ended
|
||||||||
Merchandise Group
|
April 30, 2011
|
May 1, 2010
|
||||||
Denims
|
44.6 | % | 45.4 | % | ||||
Tops (including sweaters)
|
31.3 | 32.9 | ||||||
Sportswear/Fashions
|
9.4 | 8.4 | ||||||
Accessories
|
7.7 | 6.5 | ||||||
Footwear
|
5.4 | 5.3 | ||||||
Outerwear
|
0.7 | 0.9 | ||||||
Casual bottoms
|
0.7 | 0.5 | ||||||
Other
|
0.2 | 0.1 | ||||||
100.0 | % | 100.0 | % |
Net Earnings Per Share
|
Thirteen Weeks Ended
|
Thirteen Weeks Ended
|
|||||||||||||||||||||||
April 30, 2011
|
May 1, 2010
|
|||||||||||||||||||||||
Weighted
|
Per
|
Weighted
|
Per
|
|||||||||||||||||||||
Average
|
Share
|
Average
|
Share
|
|||||||||||||||||||||
Income
|
Shares
|
Amount
|
Income
|
Shares
|
Amount
|
|||||||||||||||||||
Basic EPS
|
$ | 33,469 | 46,748 | $ | 0.72 | $ | 30,110 | 46,053 | $ | 0.65 | ||||||||||||||
Effect of Dilutive Securities:
|
||||||||||||||||||||||||
Stock options and
|
||||||||||||||||||||||||
non-vested shares
|
- | 516 | (0.01 | ) | - | 940 | (0.01 | ) | ||||||||||||||||
Diluted EPS
|
$ | 33,469 | 47,264 | $ | 0.71 | $ | 30,110 | 46,993 | $ | 0.64 |
Investments
|
Amortized
|
Gross
|
Gross
|
Other-than-
|
Estimated
|
||||||||||||||||
Cost or
|
Unrealized
|
Unrealized
|
Temporary
|
Fair
|
||||||||||||||||
Par Value
|
Gains
|
Losses
|
Impairment
|
Value
|
||||||||||||||||
Available-for-sale securities:
|
||||||||||||||||||||
Auction-rate securities
|
$ | 21,275 | $ | - | $ | (1,031 | ) | $ | (725 | ) | $ | 19,519 | ||||||||
Preferred stock
|
2,000 | - | - | (1,974 | ) | 26 | ||||||||||||||
$ | 23,275 | $ | - | $ | (1,031 | ) | $ | (2,699 | ) | $ | 19,545 | |||||||||
Held-to-maturity securities:
|
||||||||||||||||||||
State and municipal bonds
|
$ | 51,497 | $ | 456 | $ | (37 | ) | $ | - | $ | 51,916 | |||||||||
Fixed maturities
|
6,300 | 68 | - | - | 6,368 | |||||||||||||||
Certificates of deposit
|
600 | 21 | - | - | 621 | |||||||||||||||
$ | 58,397 | $ | 545 | $ | (37 | ) | $ | - | $ | 58,905 | ||||||||||
Trading securities:
|
||||||||||||||||||||
Mutual funds
|
$ | 8,734 | $ | - | $ | - | $ | - | $ | 8,734 |
Amortized
|
Gross
|
Gross
|
Other-than-
|
Estimated
|
||||||||||||||||
Cost or
|
Unrealized
|
Unrealized
|
Temporary
|
Fair
|
||||||||||||||||
Par Value
|
Gains
|
Losses
|
Impairment
|
Value
|
||||||||||||||||
Available-for-sale securities:
|
||||||||||||||||||||
Auction-rate securities
|
$ | 21,725 | $ | - | $ | (1,065 | ) | $ | (725 | ) | $ | 19,935 | ||||||||
Preferred stock
|
2,000 | - | - | (1,974 | ) | 26 | ||||||||||||||
$ | 23,725 | $ | - | $ | (1,065 | ) | $ | (2,699 | ) | $ | 19,961 | |||||||||
Held-to-maturity securities:
|
||||||||||||||||||||
State and municipal bonds
|
$ | 52,352 | $ | 428 | $ | (39 | ) | $ | - | $ | 52,741 | |||||||||
Fixed maturities
|
6,314 | 80 | - | - | 6,394 | |||||||||||||||
Certificates of deposit
|
700 | 22 | - | - | 722 | |||||||||||||||
U.S. treasuries
|
2,000 | - | - | - | 2,000 | |||||||||||||||
$ | 61,366 | $ | 530 | $ | (39 | ) | $ | - | $ | 61,857 | ||||||||||
Trading securities:
|
||||||||||||||||||||
Mutual funds
|
$ | 7,453 | $ | 274 | $ | - | $ | - | $ | 7,727 |
Nature
|
Underlying Collateral
|
Par Value
|
|||||
Municipal revenue bonds
|
98% insured by AAA/AA/A-rated bond insurers at April 30, 2011
|
$ | 10,400 | ||||
Municipal bond funds
|
Fixed income instruments within issuers' money market funds
|
7,925 | |||||
Student loan bonds
|
Student loans guaranteed by state entities
|
2,950 | |||||
Preferred stock
|
Underlying investments of closed-end funds
|
2,000 | |||||
Total par value
|
$ | 23,275 |
Amortized
|
Fair
|
|||||||
Cost
|
Value
|
|||||||
Held-to-maturity securities
|
||||||||
Less than 1 year
|
$ | 21,497 | $ | 21,580 | ||||
1 - 5 years
|
36,160 | 36,509 | ||||||
5 - 10 years
|
496 | 559 | ||||||
Greater than 10 years
|
244 | 257 | ||||||
$ | 58,397 | $ | 58,905 |
Fair Value Measurements
|
|
●
|
Level 1 – Quoted market prices in active markets for identical assets or liabilities. Short-term and long-term investments with active markets or known redemption values are reported at fair value utilizing Level 1 inputs.
|
|
●
|
Level 2 – Observable market-based inputs (either directly or indirectly) such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or inputs that are corroborated by market data.
|
|
●
|
Level 3 – Unobservable inputs that are not corroborated by market data and are projections, estimates, or interpretations that are supported by little or no market activity and are significant to the fair value of the assets. The Company has concluded that certain of its ARS represent Level 3 valuation and should be valued using a discounted cash flow analysis. The assumptions used in preparing the discounted cash flow model include estimates for interest rates, timing and amount of cash flows, and expected holding periods of the ARS.
|
|
●
|
Pricing was provided by the custodian of ARS;
|
|
●
|
Pricing was provided by a third-party broker for ARS;
|
|
●
|
Sales of similar securities;
|
|
●
|
Quoted prices for similar securities in active markets;
|
|
●
|
Quoted prices for publicly traded preferred securities;
|
|
●
|
Quoted prices for similar assets in markets that are not active - including markets where there are few transactions for the asset, the prices are not current, or price quotations vary substantially either over time or among market makers, or in which little information is released publicly;
|
|
●
|
Pricing was provided by a third-party valuation consultant (using Level 3 inputs).
|
Fair Value Measurements at Reporting Date Using
|
||||||||||||||||
Quoted Prices in
|
||||||||||||||||
Active Markets
|
Significant
|
Significant
|
||||||||||||||
for Identical
|
Observable
|
Unobservable
|
||||||||||||||
Assets
|
Inputs
|
Inputs
|
||||||||||||||
April 30, 2011
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
Total
|
||||||||||||
Available-for-sale securities:
|
||||||||||||||||
Auction-rate securities
|
$ | - | $ | 8,171 | $ | 11,348 | $ | 19,519 | ||||||||
Preferred stock
|
26 | - | - | 26 | ||||||||||||
Trading securities (including mutual funds)
|
8,734 | - | - | 8,734 | ||||||||||||
Totals
|
$ | 8,760 | $ | 8,171 | $ | 11,348 | $ | 28,279 |
Fair Value Measurements at Reporting Date Using
|
||||||||||||||||
Quoted Prices in
|
||||||||||||||||
Active Markets
|
Significant
|
Significant
|
||||||||||||||
for Identical
|
Observable
|
Unobservable
|
||||||||||||||
Assets
|
Inputs
|
Inputs
|
||||||||||||||
January 29, 2011
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
Total
|
||||||||||||
Available-for-sale securities:
|
||||||||||||||||
Auction-rate securities
|
$ | - | $ | 11,349 | $ | 8,586 | $ | 19,935 | ||||||||
Preferred stock
|
26 | - | - | 26 | ||||||||||||
Trading securities (including mutual funds)
|
7,727 | - | - | 7,727 | ||||||||||||
Totals
|
$ | 7,753 | $ | 11,349 | $ | 8,586 | $ | 27,688 |
Thirteen Weeks Ended April 30, 2011
|
|||||||||||||||||
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
|||||||||||||||||
Available-for-Sale Securities
|
Trading Securities
|
||||||||||||||||
Auction-rate
|
Preferred
|
Mutual
|
|||||||||||||||
Securities
|
Stock
|
Funds
|
Total
|
||||||||||||||
Balance, beginning of year
|
$ | 8,586 | $ | - | $ | - | $ | 8,586 | |||||||||
Transfers into Level 3
|
2,787 |
(a)
|
- | - | 2,787 | ||||||||||||
Transfers out of Level 3
|
- | - | - | - | |||||||||||||
Total gains and losses:
|
|||||||||||||||||
Included in net income
|
- | - | - | - | |||||||||||||
Included in other
|
|||||||||||||||||
comprehensive income
|
- | - | - | - | |||||||||||||
Purchases, Issuances,
|
|||||||||||||||||
Sales, and Settlements:
|
|||||||||||||||||
Purchases
|
- | - | - | - | |||||||||||||
Issuances
|
- | - | - | - | |||||||||||||
Sales
|
(25 | ) | - | - | (25 | ) | |||||||||||
Settlements
|
- | - | - | - | |||||||||||||
Balance, end of quarter
|
$ | 11,348 | $ | - | $ | - | $ | 11,348 |
|
(a)
|
Transferred from Level 2 to Level 3 due to lack of observable market data due to reduction in market activity. The Company’s policy is to recognize transfers in and transfers out as of the beginning of the reporting period in which the transfer occurred.
|
Thirteen Weeks Ended May 1, 2010
|
||||||||||||||||
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||||||||||||||||
Available-for-Sale Securities
|
Trading Securities
|
|||||||||||||||
Auction-rate
|
Preferred
|
Mutual
|
||||||||||||||
Securities
|
Stock
|
Funds
|
Total
|
|||||||||||||
Balance, beginning of year
|
$ | 8,637 | $ | - | $ | - | $ | 8,637 | ||||||||
Transfers into Level 3
|
- | - | - | - | ||||||||||||
Transfers out of Level 3
|
- | - | - | - | ||||||||||||
Total gains and losses:
|
||||||||||||||||
Included in net income
|
- | - | - | - | ||||||||||||
Included in other
|
||||||||||||||||
comprehensive income
|
- | - | - | - | ||||||||||||
Purchases, Issuances,
|
||||||||||||||||
Sales, and Settlements:
|
||||||||||||||||
Purchases
|
- | - | - | - | ||||||||||||
Issuances
|
- | - | - | - | ||||||||||||
Sales
|
(28 | ) | - | - | (28 | ) | ||||||||||
Settlements
|
- | - | - | - | ||||||||||||
Balance, end of quarter
|
$ | 8,609 | $ | - | $ | - | $ | 8,609 |
Comprehensive Income
|
Thirteen Weeks Ended
|
||||||||
April 30, 2011
|
May 1, 2010
|
|||||||
Net income
|
$ | 33,469 | $ | 30,110 | ||||
Changes in net unrealized losses on investments
|
||||||||
in auction-rate-securities, net of taxes of $(13) and $(20)
|
21 | 34 | ||||||
Comprehensive income
|
$ | 33,490 | $ | 30,144 |
Supplemental Cash Flow Information
|
Stock-Based Compensation
|
Thirteen Weeks Ended
|
||||||||
April 30, 2011
|
May 1, 2010
|
|||||||
Stock-based compensation expense, before tax:
|
||||||||
Stock options
|
$ | - | $ | 16 | ||||
Non-vested shares of common stock
|
1,621 | 1,500 | ||||||
Total stock-based compensation expense, before tax
|
$ | 1,621 | $ | 1,516 | ||||
Total stock-based compensation expense, after tax
|
$ | 1,021 | $ | 955 |
Weighted
|
|||||||||||||||||
Weighted
|
Average
|
||||||||||||||||
Average
|
Remaining
|
Aggregate
|
|||||||||||||||
Exercise
|
Contractual
|
Intrinsic
|
|||||||||||||||
Shares
|
Price
|
Life
|
Value
|
||||||||||||||
Outstanding - beginning of year
|
600,506 | $ | 4.54 | ||||||||||||||
Granted
|
- | - | |||||||||||||||
Expired/forfeited
|
- | - | |||||||||||||||
Exercised
|
(83,819 | ) | 6.12 | ||||||||||||||
Outstanding - end of quarter
|
516,687 | $ | 4.29 | 2.81 |
years
|
$ | 21,289 | ||||||||||
Exercisable - end of quarter
|
516,687 | $ | 4.29 | 2.81 |
years
|
$ | 21,289 |
Weighted Average
|
||||||||
Grant Date
|
||||||||
Shares
|
Fair Value
|
|||||||
Non-Vested - beginning of year
|
436,546 | $ | 26.07 | |||||
Granted
|
245,500 | 35.59 | ||||||
Forfeited
|
(114,350 | ) | 28.42 | |||||
Vested
|
(31,872 | ) | 28.87 | |||||
Non-Vested - end of quarter
|
535,824 | $ | 29.76 |
9.
|
Recently Issued Accounting Pronouncements
|
Percentage of Net Sales
|
||||||||||||
Thirteen Weeks Ended
|
Percentage
|
|||||||||||
April 30, 2011
|
May 1, 2010
|
Increase/(Decrease)
|
||||||||||
Net sales
|
100.0 | % | 100.0 | % | 11.8 | % | ||||||
Cost of sales (including buying,
|
||||||||||||
distribution, and occupancy costs)
|
57.1 | % | 56.5 | % | 13.0 | % | ||||||
Gross profit
|
42.9 | % | 43.5 | % | 10.2 | % | ||||||
Selling expenses
|
17.8 | % | 18.5 | % | 7.2 | % | ||||||
General and administrative expenses
|
3.7 | % | 3.5 | % | 19.4 | % | ||||||
Income from operations
|
21.4 | % | 21.5 | % | 11.2 | % | ||||||
Other income, net
|
0.6 | % | 0.8 | % | -12.0 | % | ||||||
Income before income taxes
|
22.0 | % | 22.3 | % | 10.3 | % | ||||||
Provision for income taxes
|
8.1 | % | 8.3 | % | 8.9 | % | ||||||
Net income
|
13.9 | % | 14.0 | % | 11.2 | % |
1.
|
Revenue Recognition. Retail store sales are recorded upon the purchase of merchandise by customers. Online sales are recorded when merchandise is delivered to the customer, with the time of delivery being based on estimated shipping time from the Company’s distribution center to the customer. Shipping fees charged to customers are included in revenue and shipping costs are included in selling expenses. The Company recognizes revenue from sales made under its layaway program upon delivery of the merchandise to the customer. Revenue is not recorded when gift cards and gift certificates are sold, but rather when a card or certificate is redeemed for merchandise. A current liability for unredeemed gift cards and certificates is recorded at the time the card or certificate is purchased. The amounts of the gift certificate and gift card liabilities are determined using the outstanding balances from the prior three and four years of issuance, respectively. The liability recorded for unredeemed gift certificates and gift cards was $12.9 million and $17.2 million as of April 30, 2011and January 29, 2011, respectively. The Company records breakage as other income when the probability of redemption, which is based on historical redemption patterns, is remote.
|
2.
|
Inventory. Inventory is valued at the lower of cost or market. Cost is determined using an average cost method that approximates the first-in, first-out (FIFO) method. Management makes adjustments to inventory and cost of goods sold, based upon estimates, to reserve for merchandise obsolescence and markdowns that could affect market value, based on assumptions using calculations applied to current inventory levels within each of four different markdown levels. Management also reviews the levels of inventory in each markdown group and the overall aging of the inventory versus the estimated future demand for such product and the current market conditions. Such judgments could vary significantly from actual results, either favorably or unfavorably, due to fluctuations in future economic conditions, industry trends, consumer demand, and the competitive retail environment. Such changes in market conditions could negatively impact the sale of markdown inventory, causing further markdowns or inventory obsolescence, resulting in increased cost of goods sold from write-offs and reducing the Company’s net earnings. The liability recorded as a reserve for markdowns and/or obsolescence was $4.6 million and $5.1 million as of April 30, 2011 and January 29, 2011, respectively. The Company is not aware of any events, conditions, or changes in demand or price that would indicate that its inventory valuation may not be materially accurate at this time.
|
3.
|
Income Taxes. The Company records a deferred tax asset and liability for expected future tax consequences resulting from temporary differences between financial reporting and tax bases of assets and liabilities. The Company considers future taxable income and ongoing tax planning in assessing the value of its deferred tax assets. If the Company determines that it is more than likely that these assets will not be realized, the Company would reduce the value of these assets to their expected realizable value, thereby decreasing net income. Estimating the value of these assets is based upon the Company’s judgment. If the Company subsequently determined that the deferred tax assets, which had been written down, would be realized in the future, such value would be increased. Adjustment would be made to increase net income in the period such determination was made. As of April 30, 2011 and January 29, 2011, the Company’s non-current deferred tax liability includes a $0.2 million valuation allowance recorded to reduce the value of the Company’s capital loss carryforward to its expected realizable amount prior to expiration.
|
4.
|
Operating Leases. The Company leases retail stores under operating leases. Most lease agreements contain tenant improvement allowances, rent holidays, rent escalation clauses, and/or contingent rent provisions. For purposes of recognizing lease incentives and minimum rental expenses on a straight-line basis over the terms of the leases, the Company uses the date of initial possession to begin amortization, which is generally when the Company enters the space and begins to make improvements in preparation of intended use. For tenant improvement allowances and rent holidays, the Company records a deferred rent liability on the balance sheets and amortizes the deferred rent over the terms of the leases as reductions to rent expense on the statements of income.
|
5.
|
Investments. Investments classified as short-term investments include securities with a maturity of greater than three months and less than one year, and a portion of the Company’s investments in auction-rate securities (“ARS”), which are available-for-sale securities. Available-for-sale securities are reported at fair value, with unrealized gains and losses excluded from earnings and reported as a separate component of stockholders’ equity (net of the effect of income taxes), using the specific identification method, until they are sold.
|
|
●
|
Pricing was provided by the custodian of ARS;
|
|
●
|
Pricing was provided by a third-party broker for ARS;
|
|
●
|
Sales of similar securities;
|
|
●
|
Quoted prices for similar securities in active markets;
|
|
●
|
Quoted prices for publicly traded preferred securities;
|
|
●
|
Quoted prices for similar assets in markets that are not active - including markets where there are few transactions for the asset, the prices are not current, or price quotations vary substantially either over time or among market makers, or in which little information is released publicly;
|
|
●
|
Pricing was provided by a third-party valuation consultant (using Level 3 inputs).
|
Payments Due by Period
|
||||||||||||||||||||
Contractual obligations (dollar amounts in thousands):
|
Total
|
Less than
1 year
|
1-3 years
|
4-5 years
|
After 5
years
|
|||||||||||||||
Long term debt and purchase obligations
|
$ | 8,471 | $ | 7,277 | $ | 1,194 | $ | - | $ | - | ||||||||||
Deferred compensation
|
8,734 | - | - | - | 8,734 | |||||||||||||||
Operating leases
|
349,650 | 53,705 | 96,344 | 78,232 | 121,369 | |||||||||||||||
Total contractual obligations
|
$ | 366,855 | $ | 60,982 | $ | 97,538 | $ | 78,232 | $ | 130,103 |
Amount of Commitment Expiration Per Period
|
||||||||||||||||||||
Other commercial commitments (dollar amounts in thousands):
|
Total Amounts Committed
|
Less than
1 year
|
1-3 years
|
4-5 years
|
After 5
years
|
|||||||||||||||
Lines of credit
|
$ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||
Total commercial commitments
|
$ | - | $ | - | $ | - | $ | - | $ | - |
Legal Proceedings:
|
None
|
Risk Factors:
|
Unregistered Sales of Equity Securities and Use of Proceeds:
|
Total Number
of Shares
Purchased
|
Average
Price Paid
Per Share
|
Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
|
Maximum Number of Shares that May Yet Be Purchased
Under Publicly
Announced Plans
|
|||||||||||||
Jan. 30, 2011 to Feb. 26, 2011
|
- | - | - | 552,500 | ||||||||||||
Feb. 27, 2011 to April 2, 2011
|
- | - | - | 552,500 | ||||||||||||
April 3, 2011 to April 30, 2011
|
- | - | - | 552,500 | ||||||||||||
- | - | - |
|
The Board of Directors authorized a 1,000,000 share repurchase plan on November 20, 2008. The Company has 552,500 shares remaining to complete this authorization.
|
(a)
|
Exhibits 31.1 and 31.2 certifications, as well as Exhibits 32.1 and 32.2 Certifications Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
(b)
|
Exhibit 101 includes the following materials from The Buckle, Inc.’s Quarterly Report on Form 10-Q for the quarter ended April 30, 2011, formatted in XBRL (eXtensible Business Reporting Language): (i) Balance Sheets; (ii) Statements of Income; (iii) Statements of Stockholders’ Equity; (iv) Statements of Cash Flows; and (v) Notes to Financial Statements, tagged as blocks of text.
|
|
Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files in Exhibit 101 are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 and 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.
|
Dated: June 9, 2011
|
/s/ DENNIS H. NELSON
|
DENNIS H. NELSON, President and CEO
|
|
(principal executive officer)
|
|
Dated: June 9, 2011
|
/s/ KAREN B. RHOADS
|
KAREN B. RHOADS, Vice President
|
|
of Finance and CFO
|
|
(principal accounting officer)
|
1.
|
I have reviewed this report of The Buckle, Inc. on Form 10-Q for the quarterly period ended April 30, 2011;
|
2.
|
Based on my knowledge, this quarterly 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 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:
|
5.
|
The registrant's other certifying officer 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 registrant's board of directors:
|
Date: June 9, 2011
|
|
/s/ DENNIS H. NELSON | |
Dennis H. Nelson | |||
Chief Executive Officer | |||
(principal executive officer) |
1.
|
I have reviewed this report of The Buckle, Inc. on Form 10-Q for the quarterly period ended April 30, 2011;
|
2.
|
Based on my knowledge, this quarterly 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 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:
|
5.
|
The registrant's other certifying officer 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 registrant's board of directors:
|
Date: June 9, 2011
|
|
/s/ KAREN B. RHOADS | |
Karen B. Rhoads | |||
Chief Financial Officer | |||
(principal accounting officer) |
(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.
|
(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.
|
BALANCE SHEETS (Unaudited) (Parenthetical) (USD $)
|
Apr. 30, 2011
|
Jan. 29, 2011
|
---|---|---|
STOCKHOLDERS' EQUITY: | Â | Â |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 47,342,895 | 47,127,926 |
Common stock, shares outstanding | 47,342,895 | 47,127,926 |
STATEMENTS OF INCOME (Unaudited) (USD $)
In Thousands, except Per Share data |
3 Months Ended | |
---|---|---|
Apr. 30, 2011
|
May 01, 2010
|
|
SALES, Net of returns and allowances | $ 240,092 | $ 214,797 |
COST OF SALES (Including buying, distribution, and occupancy costs) | 137,148 | 121,346 |
Gross profit | 102,944 | 93,451 |
OPERATING EXPENSES: | Â | Â |
Selling | 42,731 | 39,843 |
General and administrative | 8,859 | 7,421 |
Total selling, general and administrative expenses | 51,590 | 47,264 |
INCOME FROM OPERATIONS | 51,354 | 46,187 |
OTHER INCOME, Net | 1,612 | 1,833 |
INCOME BEFORE INCOME TAXES | 52,966 | 48,020 |
PROVISION FOR INCOME TAXES | 19,497 | 17,910 |
NET INCOME | $ 33,469 | $ 30,110 |
EARNINGS PER SHARE: | Â | Â |
Basic (in dollars per share) | $ 0.72 | $ 0.65 |
Diluted (in dollars per share) | $ 0.71 | $ 0.64 |
Basic weighted average shares | 46,748 | 46,053 |
Diluted weighted average shares | 47,264 | 46,993 |
DOCUMENT AND ENTITY INFORMATION
|
3 Months Ended | |
---|---|---|
Apr. 30, 2011
|
Jun. 03, 2011
|
|
Document Information | Â | Â |
Document Type | 10-Q | Â |
Amendment Flag | false | Â |
Document Period End Date | Apr. 30, 2011 | |
Document Fiscal Year Focus | 2011 | Â |
Document Fiscal Period Focus | Q1 | Â |
Entity Information | Â | Â |
Entity Registrant Name | BUCKLE INC | Â |
Entity Central Index Key | 0000885245 | Â |
Current Fiscal Year End Date | --01-28 | Â |
Entity Current Reporting Status | Yes | Â |
Entity Voluntary Filers | No | Â |
Entity Filer Category | Large Accelerated Filer | Â |
Entity Well-known Seasoned Issuer | Yes | Â |
Entity Common Stock, Shares Outstanding | Â | 47,355,775 |
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Fair Value Measurements
|
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Apr. 30, 2011
|
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Fair Value Measurements [Abstract] | Â | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements |
Fair
value is the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market
participants at the measurement date. Financial assets and liabilities
measured and reported at fair value are classified and disclosed in
one of the following categories:
As
of April 30, 2011 and January 29, 2011, the Company held certain
assets that are required to be measured at fair value on a recurring
basis including available-for-sale and trading securities. The
Company’s available-for-sale securities include its investments in
ARS, as further described in Note 4. The failed auctions, beginning in
February 2008, related to certain of the Company’s investments in ARS
have limited the availability of quoted market prices. The Company has
determined the fair value of its ARS using Level 1 inputs for known or
anticipated subsequent redemptions at par value, Level 2 inputs using
observable inputs, and Level 3 using unobservable inputs where the
following criteria were considered in estimating fair value:
In
addition, the Company considers other factors including, but not
limited to, the financial condition of the investee, the credit
rating, insurance, guarantees, collateral, cash flows, and the current
and expected market and industry conditions in which the investee
operates. Management believes it has used information that was
reasonably obtainable in order to complete its valuation process and
determine if the Company’s investments in ARS had incurred any
temporary and/or other-than-temporary impairment as of April 30, 2011
and January 29, 2011.
Future
fluctuations in fair value of ARS that the Company judges to be
temporary, including any recoveries of previous write-downs, would be
recorded as an adjustment to “accumulated other comprehensive
loss.” The value and liquidity of ARS held by the Company may be
affected by continued auction-rate failures, the credit quality of
each security, the amount and timing of interest payments, the amount
and timing of future principal payments, and the probability of full
repayment of the principal. Additional indicators of impairment
include the duration and severity of the decline in market value. The
interest rates on these investments will be determined by the terms of
each individual ARS. The material risks associated with the ARS held
by the Company include those stated above as well as the current
economic environment, downgrading of credit ratings on investments
held, and the volatility of the entities backing each of the issues.
The
Company’s financial assets measured at fair value on a recurring basis
were as follows:
Securities
included in Level 1 represent securities which have a known or
anticipated upcoming redemption as of the reporting date and those
that have publicly traded quoted prices. ARS included in Level 2
represent securities which have not experienced a successful auction
subsequent to the end of fiscal 2007. The fair market value for these
securities was determined by applying a discount to par value based on
auction prices for similar securities and by utilizing a discounted
cash flow model, using market-based inputs, to determine fair value.
The Company used a discounted cash flow model to value its Level 3
investments, using estimates regarding recovery periods, yield, and
liquidity. The assumptions used are subjective based upon management’s
judgment and views on current market conditions, and resulted in $877
of the Company’s recorded temporary impairment and $725 of the OTTI as
of April 30, 2011. The use of different assumptions would result in a
different valuation and related temporary impairment charge.
Changes
in the fair value of the Company’s financial assets measured at fair
value on a recurring basis are as follows:
|
Management Representation
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3 Months Ended | ||
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Apr. 30, 2011
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Management Representation [Abstract] | Â | ||
Management Representation |
The
accompanying unaudited financial statements have been prepared in
accordance with accounting principles generally accepted in the United
States of America for interim financial information. Accordingly, they
do not include all of the information and footnotes required by
accounting principles generally accepted in the United States of
America for complete financial statements. In the opinion of
management, all adjustments necessary for the fair presentation of the
results of operations for the interim periods have been included. All
such adjustments are of a normal recurring nature. Because of the
seasonal nature of the business, results for interim periods are not
necessarily indicative of a full year's operations. The accounting
policies followed by the Company and additional footnotes are
reflected in the financial statements for the fiscal year ended
January 29, 2011, included in The Buckle, Inc.'s 2010 Form 10-K.
The
Company follows generally accepted accounting principles (“GAAP”)
established by the Financial Accounting Standards Board (“FASB”).
References to GAAP in these notes are to the FASB Accounting
Standards Codification (“ASC”).
|
Supplemental Cash Flow Information
|
3 Months Ended | ||
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Apr. 30, 2011
|
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Supplemental Cash Flow Information [Abstract] | Â | ||
Supplemental Cash Flow Information |
The
Company had non-cash investing activities during the thirteen week
periods ended April 30, 2011 and May 1, 2010 of $2,157 and $2,234,
respectively. The non-cash investing activity relates to unpaid
purchases of property, plant, and equipment included in accounts
payable as of the end of the quarter. Amounts reported as unpaid
purchases are recorded as cash outflows from investing activities for
purchases of property, plant, and equipment in the statement of cash
flows in the period they are paid.
Additional
cash flow information for the Company includes cash paid for income
taxes during the thirteen week periods ended April 30, 2011 and May 1,
2010 of $453 and $1,919, respectively.
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Stock-Based Compensation
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3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Apr. 30, 2011
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Stock-Based Compensation [Abstract] | Â | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation |
The
Company has several stock option plans which allow for granting of
stock options to employees, executives, and directors. The options are
in the form of non-qualified stock options and are granted with an
exercise price equal to the market value of the Company’s common stock
on the date of grant. The options generally expire ten years from the
date of grant. The Company also has a restricted stock plan that
allows for the granting of non-vested shares of common stock to
employees and executives and a restricted stock plan that allows for
the granting of non-vested shares of common stock to non-employee
directors.
As
of April 30, 2011, 639,343 shares were available for grant under the
various stock option plans, of which 449,739 were available for grant
to executive officers. Also as of April 30, 2011, 337,769 shares were
available for grant under the Company’s various restricted stock
plans, of which 285,645 shares were available for grant to executive
officers.
Compensation
expense was recognized during the first quarter of fiscal 2011 and
fiscal 2010 for equity-based grants, based on the grant date fair
value of the awards. The fair value of stock options is determined
using the Black-Scholes option pricing model, while the fair value of
grants of non-vested common stock awards is the stock price on the
date of grant.
Information
regarding the impact of stock-based compensation expense is as follows:
FASB
ASC 718 requires the benefits of tax deductions in excess of the
compensation cost recognized for stock options exercised during the
period to be classified as financing cash inflows. This amount is
shown as “excess tax benefit from stock option exercises” on the
statements of cash flows. For the fiscal quarters ended April 30, 2011
and May 1, 2010, the excess tax benefit realized from exercised stock
options was $1,024 and $1,169, respectively.
No
stock options were granted during fiscal 2011 or fiscal 2010. On
November 17, 2010, the Board of Directors authorized a $2.50 per share
special cash dividend to be paid on December 21, 2010 to shareholders
of record at the close of business on December 3, 2010. To preserve
the intrinsic value for option holders, the Board also approved,
pursuant to the terms of the Company’s various stock option plans, a
proportional adjustment to both the exercise price and the number of
shares covered by each award for all outstanding stock options. This
adjustment did not result in any incremental compensation expense.
A
summary of the Company’s stock-based compensation activity related to
stock options for the fiscal quarter ended April 30, 2011 is as
follows:
The
total intrinsic value of options exercised during the
fiscal quarters ended April 30, 2011 and May 1, 2010 was
$3,016 and $3,332, respectively. As of April 30, 2011, there was no
unrecognized compensation expense as all outstanding stock options
were vested.
Non-vested
shares of common stock granted during the first quarter of fiscal 2011
and fiscal 2010 were granted pursuant to the Company’s 2005 Restricted
Stock Plan and the Company’s 2008 Director Restricted Stock Plan.
Shares granted under the 2005 Plan typically vest over a period of
four years, only upon certification by the Compensation Committee of
the Board of Directors that the Company has achieved its
pre-established performance targets for the fiscal year. Shares
granted under the 2008 Director Plan vest 25% on the date of grant and
then in equal portions on each of the first three anniversaries of the
date of grant.
A
summary of the Company’s stock-based compensation activity related to
grants of non-vested shares of common stock for the fiscal quarter
ended April 30, 2011 is as follows:
As
of April 30, 2011, there was $9,867 of unrecognized compensation
expense related to grants of non-vested shares. It is expected that
this expense will be recognized over a weighted average period of
approximately 2.3 years. The total fair value of shares vested during
the fiscal quarters ended April 30, 2011 and May 1, 2010 was $1,161
and $1,871, respectively.
|
Comprehensive Income
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3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Apr. 30, 2011
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Comprehensive Income [Abstract] | Â | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Comprehensive Income |
Comprehensive
income consists of net income and unrealized gains and losses on
available-for-sale securities. Unrealized losses on the Company’s
investments in auction-rate securities have been included in
accumulated other comprehensive loss and are separately included as a
component of stockholders’ equity, net of related income taxes.
|
STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) (Parenthetical) (USD $)
|
3 Months Ended | |
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Apr. 30, 2011
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May 01, 2010
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Dividends paid on common stock, per share | $ 0.20 | $ 0.20 |
Description of the Business
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Apr. 30, 2011
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Description of the Business [Abstract] | Â | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Description of the Business |
The
Company is a retailer of medium to better priced casual apparel,
footwear, and accessories for fashion conscious young men and women.
The Company operates its business as one reportable industry segment.
The Company had 422 stores located in 41 states throughout the
continental United States as of April 30, 2011 and 412 stores in 41
states as of May 1, 2010. During the first quarter of fiscal 2011, the
Company opened two new stores and substantially remodeled six stores.
During the first quarter of fiscal 2010, the Company opened eleven new
stores and substantially remodeled three stores.
The
following is information regarding the Company’s major product lines,
stated as a percentage of the Company’s net sales:
|
Net Earnings Per Share
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Apr. 30, 2011
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Net Earnings Per Share [Abstract] | Â | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Earnings Per Share |
Basic
earnings per share data are based on the weighted average outstanding
common shares during the period. Diluted earnings per share data are
based on the weighted average outstanding common shares and the effect
of all dilutive potential common shares, including stock options.
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Investments
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Investments [Abstract] | Â | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments |
The
following is a summary of investments as of April 30, 2011:
The
following is a summary of investments as of January 29, 2011:
The
auction-rate securities and preferred stock were invested as follows
as of April 30, 2011:
As
of April 30, 2011, the Company’s auction-rate securities portfolio was
34% AAA/Aaa-rated, 45% AA/Aa-rated, 12% A-rated, and 9% below A-rated.
The
amortized cost and fair value of debt securities by contractual
maturity as of April 30, 2011 is as follows:
At
April 30, 2011 and January 29, 2011, $19,545 and $19,961 of
available-for-sale securities and $36,900 and $38,474 of
held-to-maturity securities are classified in long-term investments.
Trading securities are held in a Rabbi Trust, intended to fund the
Company’s deferred compensation plan, and are classified in long-term
investments.
The
Company’s investments in auction-rate securities (“ARS”) and preferred
securities are classified as available-for-sale and reported at fair
market value. As of April 30, 2011, the reported investment amount is
net of $1,031 of temporary impairment and $2,699 of
other-than-temporary impairment (“OTTI”) to account for the impairment
of certain securities from their stated par value. The $1,031
temporary impairment is reported, net of tax, as an “accumulated other
comprehensive loss” of $650 in stockholders’ equity as of April 30,
2011. For the investments considered temporarily impaired, the Company
believes that these ARS can be successfully redeemed or liquidated
through future auctions at par value plus accrued interest. The
Company believes it has the ability and maintains its intent to hold
these investments until such recovery of market value occurs;
therefore, the Company believes the current lack of liquidity has
created the temporary impairment in valuation.
As
of April 30, 2011, the Company had $21,275 invested in ARS and $2,000
invested in preferred securities, at par value, which are reported at
their estimated fair value of $19,519 and $26, respectively. As of
January 29, 2011, the Company had $21,725 invested in ARS and $2,000
invested in preferred securities, which were reported at their
estimated fair value of $19,935 and $26, respectively. ARS have a
long-term stated maturity, but are reset through a “dutch auction”
process that occurs every 7 to 49 days, depending on the terms of the
individual security. Until February 2008, the ARS market was highly
liquid. During February 2008, however, a significant number of
auctions related to these securities failed, meaning that there was
not enough demand to sell the entire issue at auction. The failed
auctions have limited the current liquidity of certain of the
Company’s investments in ARS and the Company has reason to believe
that certain of the underlying issuers of its ARS are currently at
risk. The Company does not, however, anticipate that further auction
failures will have a material impact on the Company’s ability to fund
its business. During the first quarter of fiscal 2011, the Company was
able to successfully liquidate $450 of its investments in ARS at par
value. The Company reviews all investments for OTTI at least quarterly
or as indicators of impairment exist. Indicators of impairment include
the duration and severity of decline in market value. In addition, the
Company considers qualitative factors including, but not limited to,
the financial condition of the investee, the credit rating of the
investee, and the current and expected market and industry conditions
in which the investee operates.
As
of April 30, 2011 and January 29, 2011, all of the Company’s
investments in ARS and preferred securities were classified in
long-term investments.
|
Recently Issued Accounting Pronouncements
|
3 Months Ended | ||
---|---|---|---|
Apr. 30, 2011
|
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Recently Issued Accounting Pronouncements [Abstract] | Â | ||
Recently Issued Accounting Pronouncements |
In
January 2010, the FASB issued ASU No. 2010-06, Fair
Value Measurements and Disclosures (Topic 820): Improving Disclosures
about Fair Value Measurements.
ASU 2010-06 revises two disclosure requirements concerning fair value
measurements and clarifies two others. It requires separate
presentation of significant transfers into and out of Levels 1 and 2
of the fair value hierarchy and disclosure of the reasons for such
transfers. It also requires the presentation of purchases, sales,
issuances, and settlements within Level 3 on a gross basis rather than
a net basis. The amendments also clarify that disclosures should be
disaggregated by class of asset or liability and that disclosures
about inputs and valuation techniques should be provided for both
recurring and non-recurring fair value measurements. The new
disclosures about fair value measurements are presented in Note 5 to
these financial statements. The adoption of this statement had no
effect on the Company’s financial position or results of operations.
|
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