- Net sales increased 13.6% to $108.9 million from $95.9 million in the third quarter ended September 23, 2012.
- Total comparable store sales for all Direct-to-Consumer channels, including company-owned websites, increased 8.5% compared to an increase of 10.9% in the third quarter of 2012.
- Direct-to-Consumer North America comparable store sales increased 7.4%. Excluding e-commerce sales, Direct-to-Consumer North America comparable store sales increased 5.0%.
- Direct-to-Consumer International comparable store sales increased 17.1% in U.S. dollars, or 11.1% in Euros. Excluding e-commerce sales, Direct-to-Consumer International comparable stores sales increased 19.4% in U.S. dollars, or 13.2% in Euros.
- Gross profit increased 16.0% to $64.0 million from $55.2 million in the third quarter of 2012. Gross margin was 58.8% compared to 57.6% in the third quarter of 2012.
- Operating income increased 7.4% to $18.5 million, or 17.0% of sales, from $17.3 million, or 18.0% of sales, in the third quarter of 2012. Higher operating expenses in the third quarter of 2013 reflect increased investment in marketing and the incremental investment required to transition Tumi’s web stores to what the Company believes to be a more effective and efficient model. As previously announced, Tumi intends to implement an internal web-service function next year. In addition, Tumi continued to invest in human resources in design, IT, finance, and logistics in the third quarter of 2013 compared to the third quarter of 2012.
- Net income was $12.1 million, or $0.18 per diluted share, based on 67.9 million diluted weighted average common shares outstanding, compared to $10.5 million, or $0.15 per diluted share, based on 67.9 million diluted weighted average common shares outstanding in the third quarter of 2012.
- During the third quarter of 2013, Tumi opened 5 new stores.
- At September 29, 2013, Tumi operated 124 company-owned stores.
For the nine months ended September 29, 2013:
- Net sales increased 17.8% to $320.0 million from $271.7 million in the corresponding period of 2012.
- Gross profit increased 18.7% to $184.3 million, or 57.6% of net sales, from $155.3 million, or 57.1% of net sales, in the corresponding period of 2012.
- Operating income increased 26.9% to $54.0 million, or 16.9% of net sales, from $42.6 million, or 15.7% of net sales, in the first nine months of 2012. Excluding approximately $0.5 million ($0.3 million after tax) in operating expenses incurred in the first quarter of 2013 in conjunction with the secondary common stock offering completed in April 2013, as well as the $1.5 million ($0.9 million after tax) charge in connection with the early termination of an agreement with Tumi’s web services provider in the second quarter of 2013, operating income for the first nine months of 2013 was $56.0 million, or 17.5% of net sales. Excluding the $5.5 million ($3.1 million after tax) one-time special bonus paid to Tumi’s Chief Executive Officer, President and Director in connection with the successful completion of its IPO in the second quarter of 2012, operating income for the first nine months of 2012 was $48.1 million, or 17.7% of net sales.
- Net income was $33.8 million, or $0.50 per diluted share, based on 67.9 million diluted weighted average common shares outstanding, compared to $19.8 million, or $0.32 per diluted share, based on 61.6 million diluted weighted average common shares outstanding in the first nine months of 2012.
- Excluding the aforementioned early termination charge and one-time expense incurred in conjunction with the secondary common stock offering completed in April 2013, net income was $35.0 million, or $0.52 per diluted share, for the first nine months of 2013. For the corresponding period of 2012, net income before preferred dividend expense (non-cash) was $27.7 million, or $0.45 per diluted share, and excluding the aforementioned one-time special bonus expense, was $30.9 million, or $0.50 per diluted share.
OutlookTumi maintains its outlook for the year. For fiscal 2013, net sales are expected to increase between 16% and 18%. This assumes a comparable store sales growth for the Direct-to-Consumer North America segment in the mid- to high-single digit range and comparable store sales growth for the Direct-to-Consumer International segment in the high single-digit to low double-digit range. Net income in 2013 is expected to increase between 41% and 52%. Diluted earnings per share are expected to be in the range of $0.76 to $0.82 per diluted share. This estimate assumes diluted weighted average common shares outstanding of approximately 67.9 million at a weighted average GAAP tax rate of about 37.4%. The Company’s estimates include an anticipated increased marketing investment in the fourth quarter and acceleration of the upfront investment in the second half of 2013 in website redesign and transition to what the Company believes to be a more cost effective and improved web services platform. Capital expenditures for fiscal 2013 are expected to be in the range of $21.0 million to $26.0 million. Conference Call Tumi Holdings, Inc. will host a conference call to discuss third quarter fiscal 2013 financial results today, November 7, 2013, at 4:30 p.m. ET. The general public can access the call by dialing 1-888-895-5479 (domestic) or 1-847-619-6250 (international). The passcode is 35929440. Please dial in 5 minutes before the start of the call. The conference call will also be webcast live in the Investor Relations section of www.tumi.com. A telephone replay of the call will be available through November 14, 2013; to access the replay, dial 1-888-843-7419 for domestic callers or 1-630-652-3042 for international callers and enter access code 35929440. The webcast will be accessible on the website for approximately 90 days after the call. About Tumi Tumi is the leading global brand of premium travel, business and lifestyle products and accessories. The brand is sold in over 200 stores from New York to Paris to London and Tokyo, as well as in the world’s top department, specialty and travel retail stores in over 75 countries. For more information, please visit www.tumi.com. Forward-Looking Statements This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect Tumi’s current views with respect to, among other things, future events and performance and Tumi’s outlook for the full year of fiscal 2013. These statements may discuss net sales, gross margin, operating expenses, operating income, net income, cash flow, financial condition, impairments, expenditures, growth, strategies, plans, achievements, dividends, capital structure, organizational structure, future store openings, market opportunities and general market and industry conditions. Tumi generally identifies forward-looking statements by words such as “anticipate,” “estimate,” “expect,” “intend,” “project,” “plan,” “predict,” “believe,” “seek,” “continue,” “outlook,” “may,” “might,” “will,” “should,” “can have,” “likely” or the negative version of these words or comparable words. Forward-looking statements are based on beliefs and assumptions made by management using currently available information. These statements are only predictions and are not guarantees of future performance, actions or events. Forward-looking statements are subject to risks and uncertainties. If one or more of these risks or uncertainties materialize, or if management’s underlying beliefs or assumptions prove to be incorrect, actual results may differ materially from those contemplated by a forward-looking statement. These risks and uncertainties include those set forth under “Risk Factors” in Tumi’s filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2012, filed with the SEC on March 21, 2013, and its subsequent Quarterly Reports on Form 10-Q. Forward-looking statements speak only as of the date on which they are made. Tumi expressly disclaims any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
|TUMI HOLDINGS, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Operations (In thousands, except share and per share data)|
|Three Months Ended||Nine Months Ended|
|September 29, 2013||September 23, 2012||September 29, 2013||September 23, 2012|
|Cost of sales||44,918||40,685||135,709||116,431|
|General and administrative||9,233||7,436||27,407||28,494|
|Total operating expenses||45,466||37,925||130,317||112,713|
|OTHER INCOME (EXPENSES)|
|Dividend expense on mandatorily redeemable preferred stock and preferred equity interests||—||—||—||(7,892||)|
|Earnings from joint venture investment||100||161||587||832|
|Foreign exchange gains (losses)||831||432||197||(263||)|
|Other non-operating income (expenses)||(38||)||34||(244||)||261|
|Total other income (expenses)||731||343||(30||)||(8,213||)|
|Income before income taxes||19,257||17,593||53,968||34,347|
|Provision for income taxes||7,202||7,129||20,184||14,501|
|Weighted average common shares outstanding:|
|Basic earnings per common share||$||0.18||$||0.15||$||0.50||$||0.32|
|Diluted earnings per common share||$||0.18||$||0.15||$||0.50||$||0.32|
|TUMI HOLDINGS, INC. AND SUBSIDIARIES Condensed Consolidated Balance Sheets (In thousands, except share and per share data)|
|September 29, 2013||December 31, 2012|
|Cash and cash equivalents||$||20,467||$||36,737|
|Accounts receivable, less allowance for doubtful accounts of approximately $512 and $340 at September 29, 2013 and December 31, 2012, respectively||26,753||21,405|
|Prepaid expenses and other current assets||4,812||3,233|
|Prepaid income taxes||—||384|
|Deferred tax assets, current||3,851||3,851|
|Total current assets||155,841||138,142|
|Property, plant and equipment, net||53,779||47,004|
|Deferred tax assets, noncurrent||2,158||2,158|
|Joint venture investment||3,137||2,718|
|Intangible assets, net||130,741||130,946|
|Deferred financing costs, net of accumulated amortization of $2,881 and $2,758 at September 29, 2013 and December 31, 2012, respectively||578||701|
|TUMI HOLDINGS, INC. AND SUBSIDIARIES Condensed Consolidated Balance Sheets (continued) (In thousands, except share and per share data)|
|September 29,||December 31,|
|LIABILITIES AND STOCKHOLDERS’ EQUITY|
|Income taxes payable||439||—|
|Total current liabilities||74,689||56,869|
|Revolving credit facility||16,000||45,000|
|Other long-term liabilities||8,479||7,271|
|Deferred tax liabilities||49,016||49,016|
|Commitments and contingencies|
|Common stock—$0.01 par value; 350,000,000 shares authorized, 68,144,473 shares issued and 67,866,667 shares outstanding as of September 29, 2013 and December 31, 2012||681||681|
|Preferred stock—$0.01 par value; 75,000,000 shares authorized and no shares issued or outstanding as of September 29, 2013 and December 31, 2012||—||—|
|Additional paid-in capital||310,190||308,545|
|Treasury stock, at cost||(4,874||)||(4,874||)|
|Accumulated other comprehensive loss||(148||)||(433||)|
|Total stockholders’ equity||346,799||311,085|
|Total liabilities and stockholders’ equity||$||494,983||$||469,241|
|TUMI HOLDINGS, INC. AND SUBSIDIARIES Unaudited Segment Results|
|Direct-to- Consumer North America||Direct-to- Consumer International||Indirect-to- Consumer North America||Indirect-to- Consumer International||Non-Allocated Corporate Expenses||Consolidated Totals|
|Three Months Ended September 29, 2013|
|Operating income (loss)||$||13,195||$||910||$||9,600||$||9,358||$||(14,537||)||$||18,526|
|Depreciation and amortization||$||1,726||$||247||$||289||$||896||$||477||$||3,635|
|Three Months Ended September 23, 2012|
|Operating income (loss)||$||11,771||$||249||$||9,588||$||7,529||$||(11,887||)||$||17,250|
|Depreciation and amortization||$||1,504||$||243||$||223||$||578||$||393||$||2,941|
|Nine Months Ended September 29, 2013|
|Operating income (loss)||$||39,544||$||1,548||$||26,433||$||29,300||$||(42,827||)||$||53,998|
|Depreciation and amortization||$||5,047||$||753||$||807||$||2,589||$||1,303||$||10,499|
|Nine Months Ended September 23, 2012|
|Operating income (loss)||$||34,582||$||(148||)||$||24,706||$||23,853||$||(40,433||)||$||42,560|
|Depreciation and amortization||$||4,288||$||662||$||604||$||1,654||$||1,029||$||8,237|
|TUMI HOLDINGS, INC. AND SUBSIDIARIES Comparable Store Sales|
|Three Months Ended|
|September 29, 2013||September 23, 2012|
|Direct-to-Consumer North America (including e-commerce sales)||7.4%||10.7%|
|Direct-to-Consumer North America (excluding e-commerce sales)||5.0%||8.0%|
|Direct-to-Consumer International (including e-commerce sales)||17.1%||12.4%|
|Direct-to-Consumer International (excluding e-commerce sales)||19.4%||7.7%|
|All Direct-to-Consumer channels (including e-commerce sales)||8.5%||10.9%|
|Direct-to-Consumer International (including e-commerce sales)||11.1%||27.0%|
|Direct-to-Consumer International (excluding e-commerce sales)||13.2%||21.8%|
|TUMI HOLDINGS, INC. AND SUBSIDIARIES Unaudited Reconciliation of Net Income to Net Income Before Preferred Dividend Expense (Non-Cash) and One-Time Costs (In millions)|
|Three Months Ended||Nine Months Ended|
|September 29, 2013||September 23, 2012||September 29, 2013||September 23, 2012|
|Dividend expense on mandatorily redeemable preferred stock and preferred equity interests||–||–||–||7.9|
|One-time special bonus to Tumi’s Chief Executive Officer, President and Director in connection with Tumi’s April 2012 initial public offering (after tax)||–||–||–||3.1|
|One-time operating expenses in conjunction with secondary common stock offerings (after tax)||–||–||0.3||–|
|One-time operating expense charged in connection with the early termination of an agreement with Tumi's web service provider||–||–||0.9||–|
|Net income before preferred dividend expense (non-cash) and one-time costs 1||$12.1||$10.5||$35.0||$30.9|
|1 Totals may not foot due to rounding|
Comparable Store Sales GrowthComparable store sales are calculated based on Tumi’s company-owned stores that have been open for at least a full calendar year as of the end of Tumi’s fiscal year. For example, a store opened in October 2011 will not impact the comparable store comparison until January 1, 2013.