ABILENE, Kan., April 12, 2012 (GLOBE NEWSWIRE) -- Duckwall-ALCO Stores, Inc. (Nasdaq:DUCK), which specializes in providing a superior selection of essential products for everyday life in small-town America, today announced operating results for its fourth quarter and fiscal year ended January 29, 2012.
Net sales from continuing operations for the fourth quarter of fiscal 2012 increased 1.0% to $137.5 million, compared to fourth quarter of fiscal 2011. Same-store sales, excluding fuel center sales, for the fourth quarter of fiscal 2012 decreased 0.6% to $133.4 million, compared to fourth quarter of fiscal 2011. Net sales from continuing operations for fiscal year 2012 increased 4.4% to $482.8 million, compared to fiscal year 2011. Same-store sales, excluding fuel center sales, for fiscal year 2012 increased 3.0% to $467.7 million.
Net earnings for the fourth quarter of fiscal 2012 were $0.8 million, or $0.22 per diluted share, compared to $0.8 million, or $0.21 per diluted share, for the fourth quarter of fiscal 2011. Net earnings for fiscal 2012 were $1.7 million, or $0.43 per diluted share, compared to a net loss of $4.6 million, or $1.20 per diluted share, for fiscal year 2011. Earnings from continuing operations, net of tax, for the fourth quarter of fiscal 2012 were $0.9 million, or $0.23 per diluted share, compared to $1.9 million, or $0.49 per diluted share, for the fourth quarter of fiscal 2011. Earnings from continuing operations, net of tax, for fiscal 2012 were $1.9 million, or $0.48 per diluted share, compared to a net loss of $3.5 million, or $0.90 per diluted share, for fiscal 2011. Both Net Earnings and Earnings from Continuing Operations, for fiscal 2012, included other operating income of $1.7 million, after tax, related to an insurance settlement due to wind and hail damage. In addition, during the fourth quarter of fiscal 2012, the Company elected to change its method of accounting for inventory from the retail inventory method to the weighted average cost method. Had the Company not changed its policy for accounting for inventory Net Earnings and Earnings from Continuing Operations would have been approximately $1.9 million less, after tax, for fiscal 2012.
Richard Wilson, President and CEO, commented, "We are excited about the many improvements that have taken place throughout the Company this year. We are also encouraged by our sales and net earnings growth over the prior year's results. While net sales were negatively impacted during the fourth quarter of fiscal 2012 as a result of unseasonably warm temperatures, we were still able to achieve same-store sales increases for the full year over fiscal 2011. We attribute this turnaround to our merchandising strategies and enhanced product mix, which is providing ALCO customers with better value and a more organized shopping environment. In addition, net earnings improvement over the prior year has been achieved through cost-reduction initiatives."
Investor Conference Call
The Company will host an investor conference call at 10:00 a.m. Central Time on Friday, April 13, 2012, to discuss operating results for the fourth quarter and fiscal year ended January 29, 2012. The dial-in number for the conference call is 888-221-9588 (international/local participants dial 913-981-5546), and the Conference Code is 5403523. Parties interested in participating in the conference call should dial in approximately five minutes prior to 10:00 a.m. Central Time. A replay of the call will be available after 1:30 p.m. Central Time April 13, 2012 through April 18, 2012, by dialing 888-203-1112 (international/local participants dial 719-457-0820), and the Replay Code is 5403523. A replay of the call will also be available four hours after completion of the call by visiting the Investors page on the Company's website, www.ALCOstores.com.
Supplemental Data
The Company has included certain tables in this press release that are set forth fully in the Company's 10-K.
Certain Non-GAAP Financial Measures
The Company has included Adjusted Gross Margin and Adjusted EBITDA, non-GAAP performance measures, as part of its disclosure as a means to enhance its communications with stockholders. Certain stockholders have specifically requested this information to assist them in comparing the Company to other retailers that disclose similar non-GAAP performance measures. Further, management utilizes these measures in internal evaluation, review of performance and in comparing the Company's financial measures to those of its peers. Adjusted EBITDA differs from the most comparable GAAP financial measure (earnings [loss] from continuing operations) in that it does not include certain items, as does Adjusted Gross Margin. These items are excluded by management to better evaluate normalized operational cash flow and expenses excluding unusual, inconsistent and non-cash charges. To compensate for the limitations of evaluating the Company's performance using Adjusted Gross Margin and Adjusted EBITDA, management also utilizes GAAP performance measures such as gross margin return on investment, return on equity and cash flow from operating activities. As a result, Adjusted Gross Margin and Adjusted EBITDA may not reflect important aspects of the results of the Company's operations.
About Duckwall-ALCO Stores, Inc.
Duckwall-ALCO Stores, Inc. is a regional broad line retailer that specializes in meeting the needs of smaller, underserved communities across 23 states, primarily in the central United States. The Company offers an exceptional selection of quality products and recognized brand names at reasonable prices. Its specialty is delivering those products with the friendly, personal service its customers have come to expect. With 214 ALCO stores, the Company is proud to have continually provided excellent products at good value prices to its customers for 111 years. To learn more about the Company visit www.ALCOstores.com.
The Duckwall-ALCO Stores, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5865
Forward-looking statements
This press release contains forward-looking statements, as referenced in the Private Securities Litigation Reform Act of 1995 ("the Act"). Forward-looking statements can be identified by the inclusion of "will," "believe," "intend," "expect," "plan," "project" and similar future-looking terms. You should not rely unduly on these forward-looking statements. These forward-looking statements reflect management's current views and projections regarding economic conditions, retail industry environments, and Company performance. Forward-looking statements inherently involve risks and uncertainties, and, accordingly, actual results may vary materially. Factors which could significantly change results include but are not limited to: sales performance, expense levels, competitive activity, interest rates, changes in the Company's financial condition, and factors affecting the retail category in general. Additional information regarding these and other factors may be included in the Company's 10-Q filings and other public documents, copies of which are available from the Company on request and are available from the United States Securities and Exchange Commission.
| Duckwall-ALCO Stores, Inc.It just | ||||
| Statements of Operations | ||||
| Fiscal Years Ended January 29, 2012 and January 30, 2011 | ||||
| (dollars in thousands, except share and per share amounts) | ||||
| (unaudited) | (unaudited) | |||
| For the Thirteen Week Periods Ended | For the Fifty-Two Week Periods Ended | |||
| January 29, 2012 | January 30, 2011 | January 29, 2012 | January 30, 2011 | |
| Net sales | $ 137,534 | 136,197 | 482,767 | 462,572 |
| Cost of sales | 98,134 | 96,311 | 336,587 | 320,336 |
| Gross margin | 39,400 | 39,886 | 146,180 | 142,236 |
| Selling, general and administrative | 35,210 | 33,106 | 132,957 | 134,567 |
| Depreciation and amortization | 2,221 | 2,466 | 8,650 | 9,997 |
| Total operating expenses | 37,431 | 35,572 | 141,607 | 144,564 |
| Other operating income | -- | -- | 2,270 | -- |
| Operating income (loss) from | ||||
| continuing operations | 1,969 | 4,314 | 6,843 | (2,328) |
| Interest expense | 871 | 1,092 | 4,207 | 3,502 |
| Earnings (loss) from continuing | ||||
| operations before income taxes | 1,098 | 3,222 | 2,636 | (5,830) |
| Income tax expense (benefit) | 198 | 1,351 | 777 | (2,364) |
| Earnings (loss) from continuing operations | 900 | 1,871 | 1,859 | (3,466) |
| Earnings (loss) from discontinued | ||||
| operations, net of income tax benefit | (68) | (1,062) | (204) | (1,169) |
| Net earnings (loss) | $ 832 | 809 | 1,655 | (4,635) |
| Earnings (loss) per share | ||||
| Basic | ||||
| Continuing operations | $ 0.23 | 0.49 | 0.48 | (0.90) |
| Discontinued operations | $ (0.02) | (0.28) | (0.05) | (0.30) |
| Net earnings (loss) per share | $ 0.22 | 0.21 | 0.43 | (1.20) |
| Earnings (loss) per share | ||||
| Diluted | ||||
| Continuing operations | $ 0.23 | 0.49 | 0.48 | (0.90) |
| Discontinued operations | $ (0.02) | (0.28) | (0.05) | (0.30) |
| Net earnings (loss) per share | $ 0.22 | 0.21 | 0.43 | (1.20) |
| Weighted-average shares outstanding: | ||||
| Basic | 3,842,745 | 3,841,895 | 3,842,745 | 3,841,895 |
| Diluted | 3,842,745 | 3,841,895 | 3,842,745 | 3,841,895 |
| Duckwall-Alco Stores, Inc. | |||||||
| Schedule of Adjusted EBITDA | |||||||
| (dollars in thousands, except share and per share amounts) | |||||||
| (unaudited) | |||||||
| For the Thirty-Nine | Trailing Twelve | For the Thirteen | |||||
| 52 Weeks | Week Periods Ended | Period Ended | Week Periods Ended | 52 Weeks | |||
| October 30, | October 31, | October 30, | January 29, | January 30, | |||
| Fiscal 2011 | 2011 | 2010 | 2011 | 2012 | 2011 | Fiscal 2012 | |
| Net earnings (loss) from continuing operations (1) | $ (3,466) | 959 | (5,336) | 2,829 | 901 | 1,870 | 1,860 |
| Plus: | |||||||
| Interest | 3,502 | 3,336 | 2,410 | 4,428 | 871 | 1,092 | 4,207 |
| Taxes (1) | (2,364) | 579 | (3,715) | 1,930 | 198 | 1,351 | 777 |
| Depreciation and amortization (1) | 9,997 | 6,429 | 7,531 | 8,895 | 2,221 | 2,466 | 8,650 |
| Share-based compensation | 333 | 274 | 267 | 340 | (17) | 66 | 257 |
| Preopening store costs (2) | 543 | 236 | 492 | 287 | 321 | 51 | 557 |
| Executive and staff severance | 540 | 131 | 540 | 131 | 12 | -- | 143 |
| (Gain) loss asset disposals | 74 | (126) | (7) | (45) | 378 | 81 | 252 |
| Insurance proceeds (4) | -- | (2,270) | -- | (2,270) | -- | -- | (2,270) |
| AWG transition costs | 210 | -- | 210 | -- | -- | -- | -- |
| = Adjusted EBITDA | $ 9,369 | 9,548 | 2,392 | 16,525 | 4,885 | 6,977 | 14,433 |
| Cash | $ 4,189 | 3,125 | 5,356 | 3,125 | 2,491 | 4,189 | 2,491 |
| Debt | 59,072 | 80,210 | 64,835 | 80,210 | 65,437 | 59,072 | 65,437 |
| Debt, net of cash | $ 54,883 | 77,085 | 59,479 | 77,085 | 62,946 | 54,883 | 62,946 |
| (1) These amounts may not agree with 10-Qs of previous quarters due to subsequent store closures. These closed stores are now included in discontinued operations. | |||||||
| (2) These costs are not consistent quarter to quarter as the Company does not open the same number of stores in each quarter of each fiscal year. These costs are directly associated with the number of stores that have been or will be opened and are incurred prior to the grand opening of each store. | |||||||
| (3) For the trailing twelve periods ended January 29, 2012 the average open weeks for the Company's non same-stores was 20 weeks. | |||||||
| (4) On September 9, 2011, the Company received a $2.3 million settlement from Factory Mutual Insurance Company for damage sustained during the second quarter of fiscal 2012, due to wind and hail. | |||||||
| Duckwall-ALCO Stores, Inc. | ||
| Balance Sheets | ||
| (dollars in thousands, except share and per share amounts) | ||
| (unaudited) | ||
| January 29, 2012 | January 30, 2011 | |
| Assets | ||
| Current assets: | ||
| Cash | $ 2,491 | $ 4,189 |
| Receivables | 10,334 | 6,847 |
| Prepaid income taxes | -- | 168 |
| Inventories | 156,214 | 151,079 |
| Prepaid expenses | 3,603 | 3,720 |
| Deferred income taxes | 5,607 | 2,563 |
| Property held for sale | 568 | 884 |
| Total current assets | 178,817 | 169,450 |
| Property and equipment, at cost: | ||
| Land and land improvements | 1,508 | 1,496 |
| Buildings and building improvements | 10,488 | 11,828 |
| Furniture, fixtures and equipment | 71,518 | 69,924 |
| Transportation equipment | 861 | 1,305 |
| Leasehold improvements | 19,289 | 16,449 |
| Construction work in progress | 1,177 | 350 |
| Total property and equipment | 104,841 | 101,352 |
| Less accumulated depreciation and amortization | 76,563 | 72,788 |
| Net property and equipment | 28,278 | 28,564 |
| Property under capital leases | 24,054 | 22,254 |
| Less accumulated amortization | 11,498 | 10,727 |
| Net property under capital leases | 12,556 | 11,527 |
| Deferred income tax - non current | -- | 2,180 |
| Other non-current assets | 754 | 990 |
| Total assets | $ 220,405 | $ 212,711 |
| Duckwall-ALCO Stores, Inc. | ||
| Balance Sheets | ||
| (dollars in thousands, except share and per share amounts) | ||
| (unaudited) | ||
| January 29, 2012 | January 30, 2011 | |
| Liabilities and Stockholders' Equity | ||
| Current liabilities: | ||
| Current maturities of long-term debt | $ -- | $ 1,414 |
| Current maturities of capital lease obligations | 570 | 703 |
| Accounts payable | 26,695 | 25,970 |
| Accrued salaries and commissions | 3,984 | 4,133 |
| Accrued taxes other than income | 4,845 | 4,822 |
| Self-insurance claim reserves | 4,112 | 4,139 |
| Other current liabilities | 4,327 | 4,608 |
| Total current liabilities | 44,533 | 45,787 |
| Notes payable under revolving loan | 52,063 | 45,282 |
| Capital lease obligations - less current maturities | 12,804 | 11,673 |
| Deferred gain on leases | 3,439 | 3,826 |
| Deferred income taxes | 643 | -- |
| Other noncurrent liabilities | 2,483 | 1,850 |
| Total liabilities | 115,965 | 108,418 |
| Stockholders' equity: | ||
| Common stock, $.0001 par value, | ||
| authorized 20,000,000 shares; 3,842,745 and 3,841,895 | ||
| shares issued and outstanding, respectively | 1 | 1 |
| Additional paid-in capital | 40,115 | 40,003 |
| Retained earnings | 64,324 | 64,289 |
| Total stockholders' equity | 104,440 | 104,293 |
| Total liabilities and stockholders' equity | $ 220,405 | $ 212,711 |