“We took important steps in 2012 to reposition the company,” said Sargent. “We successfully launched our new strategic plan and made solid progress on our reinvention. We look forward to building on our momentum throughout 2013.”
Presentation of Non-GAAP Information
To provide more comparable financial results on a year over year basis, this press release presents certain results with and without the impact of the 53rd week during fiscal year 2012, without the impact of fluctuations in foreign currency exchange rates, and without the impact of certain charges described below. Charges for the impairment of goodwill and long-lived assets in the third quarter of 2012 and for accelerated tradename amortization in the third and fourth quarters of 2012 were excluded because such items are non-cash in nature. Management has excluded the store closure and restructuring charges recorded in the third and fourth quarters of 2012, certain tax items recorded in the third quarter of 2012, the loss on early extinguishment of debt in the fourth quarter 2012 and the tax refund in 2011 because the exclusion of such amounts facilitates the comparison of the company's financial results to its historical operating results. The charges related to the termination of the company’s joint venture arrangement in India in the fourth quarter of 2012 were excluded because the event is non-recurring in nature. The presentation of results that excludes these items, as well as the presentation of free cash flow, are non-GAAP financial measures that should be considered in addition to, and should not be considered superior to, or as a substitute for, the presentation of results determined in accordance with GAAP.
Management believes that the non-GAAP financial measures enable management and investors to understand and analyze the company’s performance by providing meaningful information relevant to certain events and foreign currency fluctuations that impact the comparability of underlying business results from period to period. Management uses these non-GAAP financial measures to evaluate the operating results of the company’s business against prior year results and its operating plan, and to forecast and analyze future periods. Management recognizes there are limitations associated with the use of non-GAAP financial measures as they may reduce comparability with other companies that use different methods to calculate similar non-GAAP measures. Management generally compensates for the limitations resulting from the exclusion of these items by considering the impact of these items separately in GAAP as well as non-GAAP results. In addition, management presents the most comparable GAAP measures ahead of non-GAAP measures and provides a reconciliation to the most comparable GAAP financial measure.