Operating and administrative expenses for the third quarter of 2012 increased to $225.9 million, from $224.5 in the same period last year. Operating and administrative expenses as a percentage of net sales increased to 23.2% in the third quarter of 2012, from 23.0% in the same period last year, due to increased occupancy costs related to new and replacement stores, one-time employee costs, incremental costs related to being a public company and reduced fixed cost leverage in the Company’s core business resulting from lower same store sales. Included in the third quarter 2012 were $1.4 million of one-time recruiting, relocation and severance charges related to the Company’s recently announced management changes.
For the third quarter of 2012, adjusted net income was $8.8 million, or $0.20 diluted earnings per common share, compared to $12.4 million, or $0.41 diluted earnings per common share, for the third quarter of 2011. Adjusted net income for the third quarter of 2012 excludes a $0.8 million after-tax charge, or $0.02 per diluted common share, for one-time employee related expenses as discussed above. Net income for the third quarter of 2012 was $7.9 million, or $0.18 diluted earnings per common share.
Adjusted EBITDA for the quarter ended September 29, 2012 was $43.1 million, compared to $56.7 million in the third quarter of 2011. The decrease was primarily due to the effect of a more challenging economic and competitive environment, which resulted in lower same-store sales, lower gross margins and reduced fixed cost leverage.
The Company opened two new stores and one replacement store during the third quarter of 2012 and opened one new store during the fourth quarter of 2012.Net cash provided by operating activities for the third quarter 2012 was $15.5 million, compared to $5.2 million during the third quarter 2011. The increase in cash from operating activities was due primarily to changes in working capital in the third quarter 2012 as a result of timing of payments for inventory and accounts payable.
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