DALLAS, Jan. 27, 2009 (GLOBE NEWSWIRE) -- Tuesday Morning Corporation (Nasdaq:TUES) today reported that as previously announced, net sales for the second quarter of fiscal 2009 were $272.7 million compared to $308.7 million for the quarter ended December 31, 2007, a decrease of 11.7%. Comparable store sales decreased 14.9% for the quarter ended December 31, 2008 compared to the same quarter in the prior year. The decrease in comparable store sales was comprised of a 9.6% decrease in traffic and a 5.3% decrease in average ticket. Net income for the second quarter ended December 31, 2008 was $12.7 million or $0.31 per diluted share, compared to $20.5 million or $0.50 per diluted share during the same quarter last year.
For the six month period ended December 31, 2008, net sales were $446.1 million compared to $510.3 million for the same period last year, a decrease of 12.6%. Comparable store sales decreased by 15.8% for the six month period ended December 31, 2008 compared to the same period in the prior year. The decrease in comparable store sales was comprised of an 11.4% decrease in traffic and a 4.4% decrease in average ticket. For the six month period ended December 31, 2008, net income was $8.4 million or $0.20 per diluted share compared to net income of $21.7 million or $0.52 per diluted share for the same period in the prior year. As reported on January 9, 2009, fiscal 2009 sales are projected to be in the range of $800 million to $810 million, diluted earnings per share in the range of $.00 to $.05 and comparable store sales in the negative low double digits.
Kathleen Mason, President and Chief Executive Officer, stated, "The December 2008 quarter was reported as the most difficult retail holiday season on record. While consumers remain cautious, we remain focused on preserving our strong balance sheet, managing inventory levels and generating positive cash flow."
Tuesday Morning management will review second quarter fiscal 2009 financial results in a teleconference call on January 27, 2009 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 860 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 year ended June 30, 2008 and the Company's Quarterly Report on Form 10-Q for the three month period ended September 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; and our ability to anticipate and respond in a timely manner to changing consumer demands and preferences. 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
(In thousands, except per share data)
Three Months Ended Six Months Ended
Dec. 31, Dec. 31,
-------------------- --------------------
2008 2007 2008 2007
--------- --------- --------- ---------
(unaudited) (unaudited)
Net sales $ 272,650 $ 308,687 $ 446,051 $ 510,344
Cost of sales 171,755 193,783 281,000 319,731
--------- --------- --------- ---------
Gross profit 100,895 114,904 165,051 190,613
Selling, general
and administrative
expenses 80,315 80,664 151,227 153,208
--------- --------- --------- ---------
Operating income 20,580 34,240 13,824 37,405
Other income (expense):
Interest expense (717) (1,420) (1,127) (3,106)
Interest income -- 152 1 153
Other income
(expense), net 192 195 271 572
-------------------- --------------------
Other income
(expense) (525) (1,073) (855) (2,381)
-------------------- --------------------
Income before income
taxes 20,055 33,167 12,969 35,024
Income tax expense 7,344 12,633 4,556 13,334
--------- --------- --------- ---------
Net income $ 12,711 $ 20,534 $ 8,413 $ 21,690
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Earnings Per Share:
Net income per common
share:
Basic $ 0.31 $ 0.50 $ 0.20 $ 0.52
Diluted $ 0.31 $ 0.50 $ 0.20 $ 0.52
Weighted average number
of common shares:
Basic 41,462 41,441 41,451 41,437
Diluted 41,587 41,451 41,597 41,456
Tuesday Morning Corporation (continued)
Consolidated Balance Sheets
(in thousands)
Dec. 31, Dec. 31, June 30,
2008 2007 2008
--------- --------- ---------
(unaudited)(unaudited)
Assets
Current assets:
Cash and cash equivalents $ 5,839 $ 11,993 $ 8,630
Inventories 260,888 259,299 240,996
Prepaid expenses and other
assets 9,407 6,668 11,292
Deferred income taxes 2,080 505 --
--------- --------- ---------
Total current assets 278,214 278,465 260,918
Property and equipment, net 75,714 80,792 77,315
Other long-term assets:
Deferred financing costs 3,551 603 503
Other assets 2,562 3,601 3,040
--------- --------- ---------
Total Assets $ 360,041 $ 363,461 $ 341,776
========= ========= =========
Liabilities and Stockholders'
Equity
Current liabilities:
Accounts payable $ 73,301 $ 59,601 $ 63,899
Accrued liabilities 32,048 36,223 28,862
Income taxes payable 4,296 15,408 27
--------- --------- ---------
Total current liabilities 109,645 111,232 92,788
Revolving credit facility 2,030 7,000 8,500
Deferred rent 4,043 4,390 4,163
Deferred income taxes 2,017 1,922 3,414
--------- --------- ---------
Total Liabilities 117,735 124,544 108,865
Stockholders' equity 242,306 238,917 232,911
--------- --------- ---------
Total Liabilities and
Stockholders' Equity $ 360,041 $ 363,461 $ 341,776
========= ========= =========
Tuesday Morning Corporation (continued)
Consolidated Statement of Cash Flows
(in thousands)
Six Months Ended
Dec. 31,
--------------------
2008 2007
--------------------
(unaudited)
Net cash flows from operating activities:
Net income $ 8,413 $ 21,690
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 8,446 8,854
Amortization of financing fees 226 101
Deferred income taxes (3,910) (851)
Loss on disposal of fixed assets 185 236
Stock compensation expense 1,140 2,028
Other non-cash charges 4 35
Net change in operating assets and
liabilities (8,962) 31,498
--------- ---------
Net cash provided by operating activities 5,542 63,591
--------- ---------
Net cash flows from investing activities:
Capital expenditures (7,032) (6,100)
--------- ---------
Net cash used in investing activities (7,032) (6,100)
--------- ---------
Net cash flows from financing activities:
Repayments-revolving credit facility (153,941) (168,000)
Borrowings-revolving credit facility 147,471 118,500
Change in cash overdraft 8,444 (6,297)
Proceeds from exercise of common stock
options and stock purchase plan
purchases -- (4)
Payment of debt financing costs (3,275) --
--------- ---------
Net cash used in financing activities (1,301) (55,801)
--------- ---------
Net decrease in cash and cash equivalents (2,791) 1,690
Cash and cash equivalents, beginning of
period 8,630 10,303
--------- ---------
Cash and cash equivalents, end of period $ 5,839 $ 11,993
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