United States
Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-Q
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Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
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For the quarterly period ended December 31, 2004 |
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Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
For the transition period from to
Commission file number 0-21196
MOTHERS WORK, INC.
(Exact name of registrant as specified in its charter)
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Delaware |
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13-3045573 |
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(State or other jurisdiction of |
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(IRS Employer Identification No.) |
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456 North 5th Street, Philadelphia, Pennsylvania |
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19123 |
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(Address of principal executive offices) |
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(Zip Code) |
Registrant’s telephone number, including area code (215) 873-2200
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yesý No o
Indicate by check mark whether the Registrant is an accelerated filer (as defined in Rule 12b-2 of the Act). Yesý No o
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Common Stock, $.01 par value — 5,236,515 shares outstanding as of February 3, 2005
MOTHERS WORK, INC. AND SUBSIDIARIES
INDEX
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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Certifications |
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2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
MOTHERS WORK, INC. AND SUBSIDIARIES
(in thousands, except share and per share amounts)
(unaudited)
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December 31, 2004 |
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September 30, 2004 |
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ASSETS |
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Current Assets: |
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Cash and cash equivalents |
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$ |
14,691 |
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$ |
8,467 |
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Short-term investments |
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2,500 |
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6,400 |
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Trade receivables, net |
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4,679 |
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4,382 |
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Inventories |
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98,113 |
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92,743 |
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Deferred income taxes |
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4,705 |
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4,660 |
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Prepaid expenses and other current assets |
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4,147 |
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5,744 |
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Total Current Assets |
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128,835 |
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122,396 |
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Property, Plant and Equipment, net |
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63,423 |
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60,288 |
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Assets Held for Sale |
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1,200 |
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1,200 |
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Other Assets: |
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Goodwill |
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50,389 |
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50,389 |
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Deferred financing costs, net of accumulated amortization of $1,402 and $1,267 |
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4,116 |
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3,665 |
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Other intangible assets, net of accumulated amortization of $2,487 and $2,476 |
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895 |
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946 |
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Deferred income taxes |
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11,504 |
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11,504 |
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Other non-current assets |
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567 |
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995 |
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Total Other Assets |
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67,471 |
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67,499 |
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Total Assets |
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$ |
260,929 |
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$ |
251,383 |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current Liabilities: |
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Line of credit borrowings |
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$ |
— |
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$ |
— |
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Current portion of long-term debt |
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728 |
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288 |
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Accounts payable |
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23,145 |
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19,779 |
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Accrued expenses and other current liabilities |
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35,251 |
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30,561 |
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Total Current Liabilities |
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59,124 |
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50,628 |
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Long-Term Debt |
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128,585 |
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127,629 |
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Deferred Rent and Other Non-Current Liabilities |
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6,733 |
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6,856 |
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Total Liabilities |
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194,442 |
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185,113 |
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Commitments and Contingencies (Note 9) |
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Stockholders’ Equity: |
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Preferred Stock, 2,000,000 shares authorized |
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Series A cumulative convertible preferred stock, $.01 par value; 41,000 shares authorized, none outstanding |
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— |
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— |
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Series B junior participating preferred stock, $.01 par value; 300,000 shares authorized, none outstanding |
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— |
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— |
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Common stock, $.01 par value; 20,000,000 shares authorized, 5,226,875 and 5,207,081 shares issued and outstanding, respectively |
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52 |
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52 |
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Additional paid-in capital |
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62,725 |
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62,565 |
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Retained earnings |
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3,710 |
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3,653 |
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Total Stockholders’ Equity |
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66,487 |
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66,270 |
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Total Liabilities and Stockholders’ Equity |
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$ |
260,929 |
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$ |
251,383 |
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The accompanying notes are an integral part of these Consolidated Financial Statements.
3
MOTHERS WORK, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
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Three Months Ended |
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2004 |
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2003 |
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Net sales |
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$ |
133,619 |
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$ |
131,695 |
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Cost of goods sold |
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63,206 |
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61,665 |
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Gross profit |
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70,413 |
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70,030 |
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Selling, general and administrative expenses |
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66,563 |
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62,915 |
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Operating income |
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3,850 |
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7,115 |
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Interest expense, net |
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(3,755 |
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(3,691 |
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Income before income taxes |
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95 |
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3,424 |
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Income tax provision |
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38 |
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1,370 |
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Net income |
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$ |
57 |
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$ |
2,054 |
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Net income per share—Basic |
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$ |
0.01 |
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$ |
0.39 |
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Average shares outstanding—Basic |
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5,216 |
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5,234 |
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Net income per share—Diluted |
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$ |
0.01 |
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$ |
0.37 |
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Average shares outstanding—Diluted |
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5,354 |
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5,559 |
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The accompanying notes are an integral part of these Consolidated