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SAN FRANCISCO, Jul 30, 2008 (BUSINESS WIRE) -- Bare Escentuals, Inc. (Nasdaq: BARE) today announced financial results for the second fiscal quarter and six months ended June 29, 2008.
Net sales for the second quarter of fiscal 2008 were $138.5 million, an increase of approximately 12% from $124.1 million recorded in the same period last year. Net income for the second quarter of fiscal 2008 was $24.7 million, or $0.26 per diluted share, an increase of 22% compared to $20.2 million, or $0.22 per diluted share, in the second quarter of fiscal 2007.
For the six months ended June 29, 2008, net sales increased 16% to $278.9 million, from $239.8 million in the same period last year. Net income for the first six months of 2008 was $50.5 million, or $0.54 per diluted share, an increase of 24% compared to net income of $40.6 million, or $0.44 per diluted share, during the same period last year.
"We are pleased with our overall performance in the quarter," said Leslie Blodgett, Chief Executive Officer. "The strength of the Bare Escentuals brand helped us to extend our leading market share in face makeup, and we continue to make strides in the eye, lip, and skincare categories."
Leslie added, "While we remain mindful of trends surrounding consumer spending and are thus taking a more conservative view towards sales growth, we continue to have confidence in our ability to expand our product offering, develop more points of distribution and deliver earnings in line with our prior expectations."
Guidance
For fiscal 2008, the Company now expects sales growth to be in the range of 15% to 20% compared to the prior year. The Company continues to expect diluted earnings per share for fiscal 2008 to be in the range of $1.13 to $1.18.
Conference Call
Bare Escentuals, Inc. will host a conference call today, July 30, 2008 at 1:30 p.m. Pacific (4:30 p.m. Eastern). The call will be hosted by Leslie Blodgett, Chief Executive Officer; and Myles McCormick, Chief Operating Officer and Chief Financial Officer, and will be broadcast live over the Internet and will be accessible through the Investor Relations section of the Company's website at http://ir.bareescentuals.com. The webcast will also be archived online within one hour of the completion of the conference call and available at the Investor Relations section of the Company's website at http://ir.bareescentuals.com.
About Bare Escentuals, Inc.
Bare Escentuals, Inc. is one of the fastest growing prestige cosmetic companies in the United States and a leader in mineral-based cosmetics. The Company utilizes a distinctive marketing strategy and multi-channel distribution model to develop, market and sell cosmetics, skin care, and body care products under its bareMinerals, RareMinerals and namesake Bare Escentuals brands, and professional skin care products under its md formulations brand through infomercials, home shopping television, specialty beauty retailers, department stores, company-owned boutiques, spas and salons, and online shopping.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 that involve risks, uncertainties and assumptions, such as statements regarding our plans, objectives and future operations and estimates of our financial results and capital expenditures for future periods. Our actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors. Factors that could affect future performance include, but are not limited to our dependence on sales of our mineral-based foundation; our dependence on significant customers with whom we do not have long-term purchase commitments; the highly competitive nature of the beauty industry, and the adverse consequences if we are unable to compete effectively; the possibility that we might not manage our growth effectively or sustain our growth or profitability; the possibility that we might not be able to retain key executives and other personnel and recruit additional executives and personnel; the possibility that we might not be able to open and operate new boutiques successfully; our dependence on our suppliers to produce and deliver our products in a timely and cost-effective manner; the possibility that our media spending might not result in increased net sales or generate the levels of product and brand name awareness we desire; the possibility that we may be unable to repay or refinance our indebtedness, which was $247.9 million as of June 29, 2008; changes in general economic or market conditions; and other risk factors detailed in our Annual Report on Form 10-K for the period ended December 30, 2007, as well as our Quarterly Report on Form 10-Q for the quarter ended March 30, 2008, which are available at the SEC's website at www.sec.gov. You are urged to consider these factors carefully in evaluating the forward-looking statements herein and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by this cautionary statement. The forward-looking statements made herein speak only as of the date of this press release and the company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.
BARE ESCENTUALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except percentages and per share data)
(Unaudited)
Three months ended
---------------------------------
June 29, July 1,
2008 2007
---------------- ----------------
Sales, net $138,518 100.0% $124,144 100.0%
Cost of goods sold 39,017 28.2 37,578 30.3
--------- ---------
Gross profit 99,501 71.8 86,566 69.7
Expenses:
Selling, general and
administrative 50,691 36.6 43,536 35.1
Depreciation and amortization 2,821 2.0 1,860 1.5
Stock-based compensation 968 0.7 1,779 1.4
--------- ---------
Operating income 45,021 32.5 39,391 31.7
Interest expense (4,280) (3.1) (6,274) (5.0)
Other income (expense), net (40) 0.0 487 0.4
--------- ---------
Income before provision for income
taxes 40,701 29.4 33,604 27.1
Provision for income taxes 16,009 11.6 13,389 10.8
--------- ---------
Net income $ 24,692 17.8% $ 20,215 16.3%
========= =========
Net income per share:
Basic $ 0.27 $ 0.22
========= =========
Diluted $ 0.26 $ 0.22
========= =========
Weighted-average shares used in per
share calculations:
Basic 91,377 90,021
========= =========
Diluted 93,363 93,091
========= =========
Six months ended
---------------------------------
June 29, July 1,
2008 2007
---------------- ----------------
Sales, net $278,876 100.0% $239,757 100.0%
Cost of goods sold 77,674 27.9 71,028 29.6
--------- ---------
Gross profit 201,202 72.1 168,729 70.4
Expenses:
Selling, general and
administrative 101,155 36.3 82,721 34.5
Depreciation and amortization 5,442 1.9 2,800 1.2
Stock-based compensation 2,880 1.0 3,390 1.4
--------- ---------
Operating income 91,725 32.9 79,818 33.3
Interest expense (8,924) (3.2) (13,085) (5.5)
Other income (expense), net 667 0.2 828 0.3
--------- ---------
Income before provision for income
taxes 83,468 29.9 67,561 28.1
Provision for income taxes 32,993 11.8 26,941 11.2
--------- ---------
Net income $ 50,475 18.1% $ 40,620 16.9%
========= =========
Net income per share:
Basic $ 0.55 $ 0.45
========= =========
Diluted $ 0.54 $ 0.44
========= =========
Weighted-average shares used in per
share calculations:
Basic 91,319 89,725
========= =========
Diluted 93,320 92,804
========= =========
BARE ESCENTUALS, INC.
NET SALES BY BUSINESS SEGMENT AND DISTRIBUTION CHANNEL
(in thousands, except percentages)
(Unaudited)
Three Months Ended
-------------------------------
June 29, July 1,
2008 2007
--------------- ---------------
Retail
Infomercial $ 24,688 17.8% $ 31,583 25.4%
Boutiques 27,279 19.7 19,396 15.6
-------- --------
Total retail 51,967 37.5 50,979 41.0
Wholesale
Premium wholesale 40,080 28.9 37,599 30.3
Home shopping television 24,052 17.4 16,270 13.1
Spas and salons 16,575 12.0 14,099 11.4
International distributors 5,844 4.2 5,197 4.2
-------- --------
Total wholesale 86,551 62.5 73,165 59.0
-------- --------
Sales, net $138,518 100.0% $124,144 100.0%
======== ========
Six Months Ended
------------------------------
June 29, July 1,
2008 2007
-------------- ---------------
Retail
Infomercial $ 55,367 19.9% $ 65,857 27.5%
Boutiques 53,009 19.0 36,530 15.2
-------- --------
Total retail 108,376 38.9 102,387 42.7
Wholesale
Premium wholesale 85,054 30.5 73,179 30.5
Home shopping television 41,929 15.0 29,964 12.5
Spas and salons 33,222 11.9 24,058 10.0
International distributors 10,295 3.7 10,169 4.3
-------- --------
Total wholesale 170,500 61.1 137,370 57.3
-------- --------
Sales, net $278,876 100% $239,757 100.0%
======== ========
BARE ESCENTUALS, INC.
CONSOLIDATED BALANCE SHEET DATA
(in thousands)
June 29, December 30, July 1,
2008 2007 2007
----------- ------------ -----------
(Unaudited) (Unaudited)
Cash and cash equivalents $ 31,135 $ 32,117 $ 22,564
Inventories 81,469 59,643 56,042
Accounts receivable, net of
allowances 45,266 43,369 34,477
Total current assets 180,069 151,932 134,417
Total assets 262,509 223,905 195,626
Accounts payable 29,457 22,041 28,867
Accrued liabilities 20,106 25,141 20,122
Total current liabilities 66,779 67,731 66,636
Current portion of long-term
debt 17,216 17,901 17,624
Long-term debt, less current
portion 230,694 247,032 282,376
Total stockholders' deficit $ (49,054) $ (104,487) $ (161,656)
SOURCE: Bare Escentuals, Inc.
ICR, Inc. Andrew Greenebaum / Christine Gleim, 310-954-1100 andrew.greenebaum@icrinc.com christine.gleim@icrinc.com
Copyright Business Wire 2008
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