-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CevTsD1OcU7824QX4JSUmBOVzXPAKSIBgbmmU+CqlvSG82FuRFiXKV0iyWNNWiNi kCbnb9Hr5AeJhsONdKv7vw== 0000799288-01-500044.txt : 20010517 0000799288-01-500044.hdr.sgml : 20010517 ACCESSION NUMBER: 0000799288-01-500044 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010427 ITEM INFORMATION: FILED AS OF DATE: 20010516 FILER: COMPANY DATA: COMPANY CONFORMED NAME: LANDS END INC CENTRAL INDEX KEY: 0000799288 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-CATALOG & MAIL-ORDER HOUSES [5961] IRS NUMBER: 362512786 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-09769 FILM NUMBER: 1641901 BUSINESS ADDRESS: STREET 1: ONE LANDS END LN CITY: DODGEVILLE STATE: WI ZIP: 53595 BUSINESS PHONE: 6089359341 MAIL ADDRESS: STREET 1: ONE LANDS END LANE STREET 2: ONE LANDS END LANE CITY: DODGEVILLE STATE: WI ZIP: 53595 8-K 1 fy02apr27.txt 8-K FOR FY02 LST QTR RESULTS UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ________ FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report(Date of earliest event reported) May 9, 2001 LANDS' END, INC. (exact name of registrant as specified in its charter) DELAWARE 1-9769 36-2512786 (State or other (Commission (I.R.S. Employer jurisdiction File Number Identification of incorporation Number) Lands' End Lane, Dodgeville, Wisconsin 53595 (Address of principal executive offices) (Zip Code) Registrant's telephone number 608-935-9341 including area code INFORMATION INCLUDED IN THIS REPORT Item 5. Other Events. Attached as Exhibit 99 to this report is a news release issued by Lands' End, Inc., announcing its first quarter results of fiscal year 2002 for the period ended April 27, 2001. SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, its duly authorized officer and chief financial officer. LANDS' END, INC. May 16, 2001 By: /S/ DONALD R. HUGHES Donald R. Hughes Senior Vice President & Chief Financial Officer EXHIBIT 99 FOR IMMEDIATE RELEASE LANDS' END REPORTS STRONG GAINS IN SALES AND EARNINGS FOR FIRST QUARTER DODGEVILLE, WIS. ... May 9, 2001 ... Lands' End, Inc. (LE), the direct merchant of classically styled apparel and home furnishings, today reported results for its first quarter of fiscal year 2002, ended April 27, 2001. Total revenue for the first quarter just ended was $311.1 million, up 9 percent from $285.8 million in the prior year's quarter. Net income for the quarter just ended was $5.9 million, and diluted earnings per share were $0.20, compared with net income of $292 thousand, or $0.01, for the same period last year. In commenting on the results, company president and chief executive officer David F. Dyer said, "We're extremely pleased with our first quarter performance, having demonstrated strong sales and a significant improvement in earnings. This was especially gratifying in the face of a difficult economy. The credit goes to all our Lands' End associates who continue to function as a solid team. The company is increasingly well positioned for future growth." Segment merchandise sales data for first quarter (in millions) Percent 1Q02 1Q01 Change Core business segment $173 $161 + 8 % Specialty segment 86 79 + 9 % International segment 28 26 + 7 % Total merchandise sales $287 266 + 8 % Internet $ 54 $ 39 +40 % Segment merchandise sales data excludes shipping and handling revenue. Internet merchandise sales are included in the respective business segments. As previously announced, we had shifted the timing of a major clearance catalog and added a Kids catalog, which, taken together, accounted for about two-thirds of the first quarter sales increase. Growth in the core business segment was led by strength in the women's and co-ed divisions. A portion of this growth came from mailing the Lands' End core May catalog one week earlier than last year. In the specialty segment, the Kids division showed the strongest growth; Corporate Sales grew in the low-single digits, reflecting a slowdown in national business spending; and Coming Home, which features products for bed and bath, was relatively flat. All international businesses had double-digit sales increases when measured in their local currencies, and overall international sales in U.S. dollars were also improved. Gross profit for the quarter just ended was $132 million, or 42.4 percent of total revenue, compared with $120 million, or 41.9 percent of total revenue in the prior year. Merchandise gross profit margin rose due to higher initial margins from improved sourcing. Liquidation of excess inventory was 11 percent of net merchandise sales for the first quarter of both years. Inventory was $198 million as of April 27, 2001, up 10 percent from $179 million at the same time last year. Inventory is currently in line with the sales increase and with planned levels, and the quality of inventory is improved from the prior year. For the first quarter this year, selling, general and administrative expenses were $121 million, up 3 percent from $118 million in the prior year. As a percentage of total revenue, SG&A was 39.0 percent, compared with 41.4 percent in the prior year. More than half of the improvement in the SG&A ratio was due to a reduction in national advertising expenses, bringing them more in line with historical levels of spending. In addition, higher sales productivity per page resulted in relatively lower catalog costs. BUSINESS OUTLOOK We continue to take a conservative approach to our business in light of the uncertainty in the U.S. economy, particularly in the retail environment. For fiscal 2002, a 53-week year that will end on February 1, 2002, the company expects that sales will increase in the single digit range, and we expect gross profit margin to show continued improvement compared to the prior year. As a result, we expect an increase in diluted earnings per share of at least 20 percent for the year as a whole. As described later in our statement regarding forward-looking information, our business's profit level is sensitive to many factors, including changes in sales volume, which are difficult for us, like most retailers, to accurately predict. Lands' End is a direct merchant of traditionally styled, classic products offered to customers around the world through regular mailings of its monthly and specialty catalogs and via the Internet at www.landsend.com. STATEMENT REGARDING FORWARD-LOOKING INFORMATION Statements in this release that are not historical, including, without limitation, statements regarding our plans, expectations, assumptions, and estimations for fiscal 2002, gross profit margin, and earnings, as well as anticipated sales trends and future development of our business strategy, are considered forward-looking and speak only as of today's date. As such, these statements are subject to a number of risks and uncertainties. Future results may be materially different from those expressed or implied by these statements due to a number of factors. Currently, we believe that the principal factors that create uncertainty about our future results are the following: customer response to our merchandise offerings, circulation changes and other initiatives; the mix of our sales between full price and liquidation merchandise; overall consumer confidence and general economic conditions, both domestic and foreign; effects of shifting patterns of e- commerce versus catalog purchases; costs associated with printing and mailing catalogs and fulfilling orders; dependence on consumer seasonal buying patterns; fluctuations in foreign currency exchange rates; and changes that may have different effects on the various sectors in which we operate (e.g., rather than individual consumers, the Corporate Sales Division, included in the specialty segment, sells to numerous corporations, and certain of these sales are for their corporate promotional activities). Our future results could, of course, be affected by other factors as well. More information about these risks and uncertainties may be found in the company's 10-K filings with the S.E.C. The company does not undertake to publicly update or revise its forward- looking statements even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized. WEBCAST ANNOUNCEMENT There was a live, audio webcast of the company's conference call for the general public on May 9 at 9:30 CT. This call covered the company's performance for the first quarter and its business outlook for the remainder of the year. A playback was available for one week at videonewswire.com/LANDSEND/050901. The conference call and webcast consist of copyrighted material that may not be recorded, reproduced, retransmitted, rebroadcast, stored or forwarded without Lands' End's express written permission. The call was recorded by Lands' End, and participants on the call did so under the express condition that their participation constituted their consent to (i) the copyright terms set forth above, and (ii) having any comments or statements made appear in any transcript or broadcast of the call. Contact Charlotte LaComb: 608-935-4835 Preliminary and unaudited CONSOLIDATED STATEMENTS OF OPERATIONS Lands' End, Inc. & Subsidiaries (In thousands, except per share data) Three months ended April 27, April 28, 2001 2000 Revenue Net merchandise sales $287,117 $266,045 Shipping and handling revenue 24,003 19,795 Total revenue 311,120 285,840 Cost of sales Cost of merchandise 154,913 145,146 Shipping and handling costs 24,263 20,926 Total cost of sales 179,176 166,072 Gross profit 131,944 119,768 Selling, general and administrative expenses 121,438 118,448 Income from operations 10,506 1,320 Other income Interest expense (233) (130) Interest income 636 719 Other (1,536) (1,445) Total other expense, net (1,133) (856) Income before income taxes 9,373 464 Income tax provision 3,515 172 Net income $ 5,858 $ 292 Basic earnings per share $ 0.20 $ 0.01 Diluted earnings per share $ 0.20 $ 0.01 Basic weighted average shares outstanding 29,380 30,199 Diluted weighted average shares outstanding 29,620 30,835 Preliminary and unaudited CONSOLIDATED BALANCE SHEETS Lands' End, Inc. & Subsidiaries (In thousands) April 27, April 28, 2001 2000 Assets Current assets: Cash and cash equivalents $ 26,591 $ 45,078 Receivables, net 17,140 17,141 Inventory 197,561 179,143 Prepaid advertising 20,801 21,877 Other prepaid expenses 8,947 7,981 Income taxes receivable 397 63 Deferred income tax benefits 10,973 10,661 Total current assets 282,410 281,944 Property, plant and equipment, at cost: Land and buildings 104,880 102,788 Fixtures and equipment 103,512 104,194 Computer hardware and software 105,334 74,523 Leasehold improvements 4,642 4,453 Construction in progress 7,461 - Total property, plant and equipment 325,829 285,958 Less-accumulated depreciation and amortization 138,134 123,702 Property, plant and equipment, net 187,695 162,256 Intangibles, net 645 637 Total assets $470,750 $444,837 Liabilities and shareholders' investment Current liabilities: Lines of credit $ 21,573 $ 18,412 Accounts payable 67,152 72,638 Reserve for returns 7,287 6,014 Accrued liabilities 35,626 36,154 Accrued profit sharing 755 186 Total current liabilities 132,393 133,404 Deferred income taxes 17,251 9,117 Shareholders' investment: Common stock, 40,221 shares issued 402 402 Donated capital 8,400 8,400 Additional paid-in capital 32,358 31,541 Deferred compensation (103) (204) Accumulated other comprehensive income 4,477 3,413 Retained earnings 494,945 454,722 Treasury stock, 10,834 and 9,925 shares at cost, respectively (219,373) (195,958) Total shareholders' investment 321,106 302,316 Total liabilities and shareholders' investment $470,750 $444,837 Preliminary and unaudited CONSOLIDATED STATEMENTS OF CASH FLOWS Lands' End, Inc. & Subsidiaries (In thousands) Three Months Ended April 27, April 28, 2001 2000 Cash flows from (used for) operating activities: Net income $ 5,858 $ 292 Adjustments to reconcile net income to net cash flows from operating activities- Depreciation and amortization 6,235 5,990 Deferred compensation expense 18 32 Deferred income taxes 2,684 - Tax benefit of stock options 450 1,832 Changes in assets and liabilities: Receivables, net 2,668 612 Inventory (9,350) (16,950) Prepaid advertising (3,174) (5,305) Other prepaid expenses 768 (2,165) Accounts payable (29,016) (1,872) Reserve for returns (1,774) (1,855) Accrued liabilities (4,779) (4,653) Accrued profit sharing (1,602) (2,574) Income taxes payable (13,610) (10,318) Other (1,497) 738 Net cash flows used for operating activities (46,121) (36,196) Cash flows from (used for) investing activities: Cash paid for capital additions (9,361) (5,042) Net cash flows used for investing activities (9,361) (5,042) Cash flows from (used for) financing activities: Proceeds from short-term debt 4,633 6,688 Purchases of treasury stock (4) (1,014) Issuance of treasury stock 2,093 4,229 Net cash flows from financing activities 6,722 9,903 Net decrease in cash and cash equivalents (48,760) (31,335) Beginning cash and cash equivalents 75,351 76,413 Ending cash and cash equivalents $ 26,591 $ 45,078 -----END PRIVACY-ENHANCED MESSAGE-----