Published: November 02, 2005
Big Dog Holdings, Inc. Announces Third Quarter 2005 Financial Results
Big Dog Holdings, Inc. (NASDAQ: BDOG);
www.bigdogs.com, www.thewalkingcompany.com), a developer and retailer of
branded, lifestyle consumer products, today reported the financial results
for the third quarter ended September 30, 2005.
For the quarter ended September 30, 2005, consolidated net sales were
$44,909,000 as compared with $42,695,000 in the third quarter 2004. Our
consolidated net sales increased 5.2%, primarily due to comparative stores
sales increase of 4.1% (comparative store sales decline of 1.6% for Big
Dogs and comparative store sales increase of 13.1% for TWC), and the net
increase in the number of stores opened for the quarter. The Company had a
total of 263 stores opened (176 Big Dog stores and 87 TWC stores) at the
end of the period, as compared 261 stores last year (188 Big Dogs stores
and 73 TWC stores as of September 30, 2004). Consolidated gross profit
increased to $25,286,000 in the third quarter 2005 as compared with
$23,433,000 in the third quarter 2004. The overall increase in
consolidated gross profit is the result of increased sales for TWC, as well
as increased margin contributions from both Big Dogs and TWC. Big Dogs'
gross margin for the period increased to 60.4%, as compared to last year's
margin of 58.0%, and the gross margin for the TWC chain increased to 50.9%
compared to 49.7% last year.
Consolidated operating expenses in the third quarter 2005 were $22,262,000,
or 49.6% of consolidated net sales, compared to $21,174,000, or 49.6% in
2004. Consolidated net income increased to $1,770,000 in 2005 as compared
to $1,284,000 for the third quarter 2004. Fully diluted net income per
share increased to $.18 per share as compared with $.13 per share last
year.
Included in the third quarter, effective August 31, 2005, is the purchase
by The Walking Company of Footworks, a seven-store comfort shoe chain that
primarily operates in the Las Vegas market. The Company purchased its
assets for approximately $10.1 million.
Andrew Feshbach, Chief Executive Officer, stated, "Given the unusual number
of hurricanes this quarter, we are very pleased with the results of our 3rd
quarter business for both chains. Currently, we are focused on our 4th
quarter business and integrating our Footworks acquisition into The Walking
Company. Sales in the 4th quarter are trending as experienced earlier this
year and we look forward to a good holiday selling season."
Big Dog Holdings, Inc. consists of Big Dogs and The Walking Company. Big
Dogs develops, markets and retails a branded, lifestyle collection of
unique, high-quality, popular-priced consumer products, including
activewear, casual sportswear, accessories and gifts. The BIG DOGS® brand
image is one of quality, value and fun. The BIG DOGS® brand is designed
to appeal to people of all ages and demographics, particularly baby boomers
and their kids, big and tall customers, and pet owners. In addition to its
176 retail stores, Big Dogs markets its products through its catalog,
internet and corporate sales accounts. The Walking Company is a leading
independent specialty retailer of high quality, technically designed
comfort shoes and accessories that features premium brands such as ECCO,
Mephisto, Dansko, Birkenstock and Merrell among many others. These
products have particular appeal to one of the largest and most rapidly
growing demographics in the nation. The Walking Company operates 88 stores
in premium malls across the nation.
Safe Harbor Statement Under the Private Securities Litigation Reform Act of
1995 -- With the exception of historical information, the matters discussed
in this press release are forward-looking statements that involve a number
of risks and uncertainties. The actual future sales and other results of
the Company could differ significantly from those statements. Further
information on the Company's risk factors is contained in the Company's
quarterly and annual reports as filed with the Securities and Exchange
Commission.
BIG DOG HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
September 30,
----------------------------
2005 2004
------------- -------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 390,000 $ 2,330,000
Receivables, net 529,000 403,000
Inventories 58,573,000 51,791,000
Prepaid expenses and other current
assets 1,478,000 1,214,000
Deferred income taxes 1,923,000 1,287,000
------------- -------------
Total current assets 62,893,000 57,025,000
PROPERTY AND EQUIPMENT, Net 10,756,000 10,520,000
INTANGIBLE ASSETS, Net 7,811,000 172,000
DEFERRED INCOME TAXES 1,613,000 1,292,000
OTHER ASSETS 360,000 420,000
------------- -------------
TOTAL $ 83,433,000 $ 69,429,000
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term borrowings $ 12,191,000 $ 15,628,000
Current portion of long-term debt 1,616,000 272,000
Accounts payable 14,577,000 7,720,000
Income taxes payable 1,006,000 452,000
Accrued expenses and other current
liabilities 4,533,000 4,963,000
------------- -------------
Total current liabilities 33,923,000 29,035,000
NOTE PAYABLE 4,736,000 530,000
CAPITAL LEASE OBLIGATIONS 83,000 298,000
DEFERRED RENT AND LEASE INCENTIVES 1,376,000 953,000
DEFERRED GAIN ON SALE-LEASEBACK 208,000 261,000
------------- -------------
Total liabilities 40,326,000 31,077,000
STOCKHOLDERS' EQUITY 43,107,000 38,352,000
------------- -------------
TOTAL $ 83,433,000 $ 69,429,000
============= =============
BIG DOG HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2005 2004 2005 2004
------------ ------------ ------------ ------------
NET SALES $ 44,909,000 $ 42,695,000 $119,695,000 $105,619,000
COST OF GOODS SOLD 19,623,000 19,262,000 53,502,000 47,934,000
------------ ------------ ------------ ------------
GROSS PROFIT 25,286,000 23,433,000 66,193,000 57,685,000
------------ ------------ ------------ ------------
OPERATING EXPENSES:
Selling, marketing
and distribution 20,055,000 19,363,000 57,649,000 52,371,000
General and
administrative 2,207,000 1,811,000 6,236,000 5,544,000
------------ ------------ ------------ ------------
Total operating
expenses 22,262,000 21,174,000 63,885,000 57,915,000
------------ ------------ ------------ ------------
INCOME (LOSS) FROM
OPERATIONS 3,024,000 2,259,000 2,308,000 (230,000)
OTHER INCOME - - - 82,000
INTEREST INCOME 1,000 5,000 42,000 25,000
INTEREST EXPENSE (170,000) (192,000) (618,000) (619,000)
------------ ------------ ------------ ------------
INCOME (LOSS) BEFORE
PROVISION (BENEFIT)
FOR INCOME TAXES 2,855,000 2,072,000 1,732,000 (742,000)
PROVISION (BENEFIT) FOR
INCOME TAXES 1,085,000 788,000 658,000 (281,000)
------------ ------------ ------------ ------------
NET INCOME (LOSS) $ 1,770,000 $ 1,284,000 $ 1,074,000 $ (461,000)
============ ============ ============ ============
NET INCOME (LOSS) PER
SHARE
BASIC $ 0.19 $ 0.14 $ 0.12 $ (0.05)
============ ============ ============ ============
DILUTED $ 0.18 $ 0.13 $ 0.11 $ (0.05)
============ ============ ============ ============
WEIGHTED AVERAGE
SHARES OUTSTANDING:
BASIC 9,141,000 9,189,000 9,169,000 8,568,000
============ ============ ============ ============
DILUTED 9,680,000 9,633,000 9,736,000 8,568,000
============ ============ ============ ============
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