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Cost Plus, Inc. Reports Fourth Quarter And Fiscal 2011 Results And Provides Outlook For The First Quarter And Full Year Fiscal 2012

Use of Non-GAAP Financial Information

This release references the non-GAAP financial measure of EBITDA. The Company believes that the non-GAAP financial measure allows management and investors to understand and compare the Company's operating results in a more consistent manner for the fourth quarter and full year of fiscal 2011 and for the outlook amounts provided for the first quarter and full year of fiscal 2012. The non-GAAP measure presented may not be comparable to similarly titled measures reported by other companies. The non-GAAP measure should be considered supplemental and not a substitute for the Company's financial results that are recorded in accordance with generally accepted accounting principles for the periods presented.

The following table is a reconciliation of the Company’s net income from continuing operations to EBITDA from continuing operations for the fourth quarter and full year of fiscal 2011 and 2010:

  Fourth Quarter   Full Year
(In thousands) FY11   FY10 FY11   FY10
   
Net income from continuing operations $ 36,754 $ 28,775 $ 17,711 $ 4,674
Add back:
Net interest expense 3,171 2,900 12,814 11,115
Income tax expense 2,633 715 1,554 876
Depreciation and amortization expense   4,688     5,189   19,235     22,791
EBITDA from continuing operations $ 47,246   $ 37,579 $ 51,314   $ 39,456

The following table is a reconciliation of the Company’s projected net income/(loss) from continuing operations to EBITDA from continuing operations for the first quarter and full year of fiscal 2012 compared to actual results for the first quarter and full year of fiscal 2011:

  First Quarter   Full Year
(In thousands) FY12 1 Outlook   FY11 FY12 1 Outlook   FY11
           
Net income/(loss) from continuing operations ($ 1,600 )   ($ 800 ) ($ 3,035 ) $ 26,000   $ 28,000 $ 17,711
Add back:
Net interest expense 3,000 3,000 3,081 12,000 12,000 12,814
Income tax (benefit)/expense (400 ) (100 ) (85 ) 7,000 8,000 1,554
Depreciation and amortization expense   4,400       4,400       5,023     18,000     18,000     19,235
EBITDA from continuing operations $ 5,400     $ 6,500     $ 4,984   $ 63,000   $ 66,000   $ 51,314

1. The projected results for fiscal 2012 are provided in the table in a range for the first quarter and the full year.

 
COST PLUS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts, unaudited)
           
 

Fourth Quarter

January 28, 2012

January 29, 2011

 
Net sales $ 364,312 100.0 % $ 341,563 100.0 %
Cost of sales and occupancy   239,232   65.7   228,599   66.9
Gross profit 125,080 34.3 112,964 33.1
 
Selling, general and administrative expenses 82,377 22.6 80,090 23.4
Store closure costs 145 0.0 478 0.1
Store preopening expenses   0   0.0   6   0.0
 
Income from continuing operations, before interest and taxes 42,558 11.7 32,390 9.5
Net interest expense   3,171   0.9   2,900   0.8
 
Income from continuing operations before income taxes 39,387 10.8 29,490 8.6
Income tax expense   2,633   0.7   715   0.2
 
Net income from continuing operations 36,754 10.1 28,775 8.4
 
Loss from discontinued operations   (253 ) (0.1 )   (278 ) (0.1 )
 
Net income $ 36,501 10.0 % $ 28,497 8.3 %
 
Net income per share from continuing operations - diluted $ 1.56 $ 1.24
Net loss per share from discontinued operations - diluted $ (0.01 ) $ (0.01 )
Net income per share - diluted $ 1.55 $ 1.23
 
Weighted average shares outstanding - diluted 23,520 23,226
 
New stores opened 0 0
 
For the Twelve Month Period Ended

January 28, 2012

January 29, 2011

 
Net sales $ 963,833 100.0 % $ 916,564 100.0 %
Cost of sales and occupancy   654,208   67.9   625,619   68.3
Gross profit 309,625 32.1 290,945 31.7
 
Selling, general and administrative expenses 277,411 28.8 270,853 29.6
Store closure (income)/costs (41 ) (0.0 ) 3,173 0.3
Store preopening expenses   176   0.0   254   0.0
 
Income from continuing operations, before interest and taxes 32,079 3.3 16,665 1.8
Net interest expense   12,814   1.3   11,115   1.2
 
Income from continuing operations before income taxes 19,265 2.0 5,550 0.6
Income tax expense   1,554   0.2   876   0.1
 
Net income from continuing operations 17,711 1.8 4,674 0.5
 
Loss from discontinued operations   (1,213 ) (0.1 )   (1,816 ) (0.2 )
 
Net income $ 16,498 1.7 % $ 2,858 0.3 %
 
Net income per share from continuing operations - diluted $ 0.76 $ 0.21
Net loss per share from discontinued operations - diluted $ (0.05 ) $ (0.08 )
Net income per share - diluted $ 0.71 $ 0.13
 
Weighted average shares outstanding - diluted 23,357 22,621
 
New stores opened 1 2
 
   
COST PLUS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, unaudited)
 

January 28, 2012

January 29, 2011

 
ASSETS
Current assets:
Cash and cash equivalents $ 5,870 $ 2,691
Merchandise inventories, net 199,707 181,853
Other current assets   13,426     12,420  
 
Total current assets 219,003 196,964
 
Property and equipment, net 135,411 145,678
Other assets, net   5,216     6,007  
 
Total assets $ 359,630 $ 348,649
 
 
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 78,423 $ 55,822
Accrued compensation 19,017 17,516
Revolving line of credit and term loan 0 25,400
Current portion of distribution center sale-leaseback obligations 929 885
Other current liabilities   26,268     27,363  
 
Total current liabilities 124,637 126,986
 
Capital lease obligations 4,461 6,029
Long-term distribution center sale-leaseback obligations 110,918 111,847
Other long-term obligations 21,185 25,422
 
Shareholders' equity:
Common stock 224 221
Additional paid-in capital 176,331 172,768
Accumulated deficit   (78,126 )   (94,624 )
 
Total shareholders' equity   98,429     78,365  
 
Total liabilities and shareholders' equity $ 359,630 $ 348,649

 





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