EX-99.1 2 v030661_ex99-1.htm Unassociated Document
Exhibit 99.1

   
 
NEWS RELEASE

THE DRESS BARN, INC. REPORTS RECORD FISCAL FIRST QUARTER 2006 RESULTS

-- 1Q 06 Sales Increase 62% to $318.9 Million --
-- 1Q 06 Diluted Earnings Per Share Increase 167% to $0.64 --
-- Raises Earnings Guidance for Fiscal 2006 --


SUFFERN, NY - NOVEMBER 30, 2005 - The Dress Barn, Inc. (NASDAQ - DBRN), a leading national specialty apparel retailer offering quality career and casual fashion apparel through its dressbarn and maurices brands, today announced record sales and earnings results for its first fiscal quarter ended October 29, 2005.
 
Net sales for the thirteen-week period ended October 29, 2005, increased 62% to $318.9 million compared to $197.1 million in the first quarter of the prior year. The quarterly increase was driven by better than expected sales results for both the dressbarn and maurices brands. The Company noted that results from maurices were not included in the year-ago period, as the business was acquired on January 2, 2005. Comparable store sales, which do give effect to maurices in the year-ago period, increased 9% for the first quarter.

Net earnings for the thirteen-week period ended October 29, 2005 increased 187% to a record level of $20.4 million, or $0.64 per diluted share, compared to $7.1 million, or $0.24 per diluted share in the year-ago quarter.

David R. Jaffe, President and Chief Executive Officer, commented, “We are extremely pleased with our record first quarter results and are proud that both dressbarn and maurices contributed significantly to our success in the quarter. Our ability to exceed our internal plan was a result of several key factors.

Our merchandise assortments for both concepts continued to be trend-right. We worked very hard to create unique, fashionable product offerings in each concept and believe that this not only generated excellent results, but also has benefited the consumer perception of our brands. The dressbarn and maurices consumers continue to desire a more exciting look for their wardrobes and have responded very well to our diversified color palette and to our mix of accessories. We believe that our strategy to focus on lifestyle merchandising, where we present outfits on the selling floor by end-use and color story, increased our average selling price as well as units per transaction.

Our combined improved gross margin reflects higher sell-throughs and better maintained margin levels with below-plan markdown activity. We also achieved strong operating leverage as a result of economies of scale from the quarterly comparable sales increase and as a result of leverage from cost savings associated with the integration of maurices.”

Mr. Jaffe concluded, “As we look to the holiday season, we continue to strengthen the dressbarn brand through ongoing improvements to our merchandising and marketing efforts. At maurices, we remain on plan with an aggressive store roll out strategy and continue to improve our margin performance and identify additional synergies with dressbarn. We feel very good with our overall merchandise assortment and believe we have good momentum in our business as we move into the second quarter of our fiscal year.”

Earnings Guidance

As a result of the record first quarter earnings performance, the Company has raised its earnings guidance per diluted share for the full fiscal year ending July 29, 2006 to the range of $1.90 to $1.95 from its previous earnings guidance of $1.60 to $1.65 per diluted share. This estimate is based on achieving comparable store sales increases in the range of 4% for the remainder of the fiscal year and includes an estimated $0.08 per diluted share for the year for the expensing of stock options.

Conference Call Information

The Company will conduct a conference call today, November 30, 2005 at 4:30 p.m. Eastern Time to review its first quarter financial results. The conference call will be webcast and can be accessed via the company’s website at www.dressbarn.com. The dial-in number is 617-213-8067 and the passcode is 28413287. A replay of the call will be available until December 31, 2005 by dialing 617-801-6888; the access code is 68613000.

ABOUT THE DRESS BARN, INC.
 
The Dress Barn, Inc. (NASDAQ - DBRN), is a leading national specialty apparel retailer offering quality career and casual fashion apparel through its dressbarn and maurices brands. As of November 26, 2005, the Company operated 797 dressbarn stores and 511 maurices stores. For more information, please visit www.dressbarn.com and www.maurices.com.

FORWARD-LOOKING STATEMENTS
 
Certain statements made in this press release and the conference call which are not historical in nature are “forward-looking statements”, within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially. The Company does not undertake to publicly update or review its forward-looking statements even if experience or future changes make it clear that our projected results expressed or implied will not be achieved. Detailed information concerning a number of factors as they relate to dressbarn’s operations that could cause actual results to differ materially from the information is readily available on our most recent report on Form 10-K for the year ending July 30, 2005. Such factors as they relate to maurices include risks applicable to the retail apparel business in general and risks which may be applicable to maurices’ business. In addition, there are risks associated with the integration of two businesses.

The conference call will be recorded on behalf of The Dress Barn, Inc. and consists of copyrighted material. It may not be re-recorded, re-produced, transmitted or re-broadcast, in whole or in part, without the Company’s express written permission. Accessing the call or the rebroadcast represents consent to these terms and conditions. Participation in the call serves as consent to having any comments or statements made appear on any transcript, broadcast or rebroadcast of this call.
 
CONTACT: The Dress Barn, Inc.
  Investor Relations
  (845) 369-4600
 


                   
The Dress Barn, Inc. and Subsidiaries
Condensed Consolidated Statements of Earnings - Unaudited
              
Dollars in thousands except shares and per share amounts
                   
                   
   
Thirteen Weeks Ended
   
October 29,
      
October 30,
      
   
2005
      
2004
      
                   
Net sales
  
$
318,889
    
100.0
%
$
197,116
    
100.0
%
Cost of sales, including
                         
occupancy and buying costs
    
186,774
   
58.6
%
  
124,412
   
63.1
%
Gross profit
    
132,115
   
41.4
%
  
72,704
   
36.9
%
Selling, general and
                         
administrative expenses
    
84,740
   
26.6
%
  
55,133
   
28.0
%
Depreciation expense
    
10,305
   
3.2
%
  
6,156
   
3.1
%
Litigation
    
—
          
799
    
0.4
%
Operating income
    
37,070
   
11.6
%
  
10,616
    
5.4
%
                           
Interest income
    
150
   
0.0
%
  
722
   
0.4
%
Interest expense
    
(1,708
)
  
-0.5
%
  
(461
)
  
-0.2
%
Other income
    
381
   
0.1
%
  
381
   
0.2
%
Earnings before income taxes
    
35,893
   
11.3
%
  
11,258
   
5.7
%
Income taxes
    
15,525
   
4.9
%
  
4,109
   
2.1
%
Net earnings
  
$
20,368
    
6.4
%
$
7,149
    
3.6
%
                           
Earnings per share:
                          
Basic
  
$
0.67
        
$
0.24
        
Diluted
  
$
0.64
        
$
0.24
        
                           
Weighted average shares outstanding:
                          
Basic
    
30,270
          
29,578
        
Diluted
    
32,009
         
30,356
        
 
 
 
 
           
The Dress Barn, Inc. and Subsidiaries
          
Condensed Consolidated Balance Sheets - Unaudited
      
Dollars in thousands
          
           
   
October 29,
  
July 30,
  
ASSETS
  
2005
  
2005
  
Current Assets:
          
Cash and cash equivalents
  
$
48,975
  
$
42,434
  
Restricted cash and investments
    
100
   
100
  
Marketable securities and investments
    
23,117
   
85
 
Merchandise inventories
    
166,500
   
167,643
 
Prepaid expenses and other
    
14,429
   
12,923
 
Total Current Assets
    
253,121
   
223,185
 
Property and equipment
    
231,344
   
232,698
 
Intangible assets, net
    
110,982
    
111,243
  
Goodwill
    
132,566
    
132,566
 
Other assets
    
15,834
   
16,553
 
   
$
743,847
  
$
716,245
  
               
LIABILITIES AND SHAREHOLDERS' EQUITY
              
Current Liabilities:
              
Accounts payable- trade
  
$
100,020
  
$
107,702
  
Accrued salaries, wages and related expenses
    
38,025
   
35,209
 
Other accrued expenses
    
40,261
   
35,237
 
Customer credits
    
13,804
   
12,849
 
Income taxes payable
    
12,806
   
92
 
Current portion of deferred tax liability
    
2,972
    
3,612
  
Current portion of long-term debt
    
1,104
   
1,089
 
Total Current Liabilities
    
208,992
   
195,790
 
Long-term deferred tax liability
    
6,542
   
7,233
 
Deferred rent and other
    
45,372
    
44,194
  
Long-term debt
    
145,618
   
155,900
  
Shareholders' equity
    
337,323
    
313,128
 
   
$
743,847
  
$
716,245