UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| |X| | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED APRIL 30, 2005 |
OR
| |_| | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Commission file number 1-10204
CPI Corp.
(Exact name of registrant as specified in its charter)
|
Delaware (State or other jurisdiction of incorporation or organization) 1706 Washington Ave., St. Louis, Missouri (Address of principal executive offices) |
43-1256674
(I.R.S. Employer Identification No.) 63103 (Zip Code) |
Registrant’s telephone number, including area code: (314) 231-1575
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 and [2] has been subject to such filing requirements for the past 90 days.
|X| Yes |_| No
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).
|X| Yes |_| No
As of June 6, 2005, the Registrant had 7,850,297 common shares outstanding.
Item 1 Financial Statements
| thousands | April
30, 2005 (Unaudited) |
February 5, 2005 | ||||
|
|
|
|||||
| ASSETS | ||||||
| Current assets: | ||||||
| Cash and cash equivalents | $ | 25,021 | $ | 33,883 | ||
| Restricted cash-collateral for outstanding letters of credit | 5,904 | 6,154 | ||||
| Accounts receivable: | ||||||
| Due from licensor stores | 8,989 | 7,365 | ||||
| Other | 143 | 326 | ||||
| Inventories | 11,087 | 10,521 | ||||
| Prepaid expenses and other current assets | 7,041 | 6,905 | ||||
| Deferred tax assets | 10,834 | 8,795 | ||||
|
|
|
|||||
| Total current assets | 69,019 | 73,949 | ||||
|
|
|
|||||
| Property and equipment: | ||||||
| Land | 2,765 | 2,765 | ||||
| Building improvements | 26,405 | 26,684 | ||||
| Leasehold improvements | 5,954 | 6,005 | ||||
| Photographic, sales and manufacturing equipment | 179,645 | 183,979 | ||||
|
|
|
|||||
| Total | 214,769 | 219,433 | ||||
| Less accumulated depreciation and amortization | 171,419 | 177,775 | ||||
|
|
|
|||||
| Property and equipment, net | 43,350 | 41,658 | ||||
| Assets of business transferred under contractual arrangements: | ||||||
| Preferred Security | 7,000 | 7,000 | ||||
| Accrued dividends on preferred security | 834 | 689 | ||||
| Impairment reserve related to preferred security interest | (7,834 | ) | (7,689 | ) | ||
| Other investments - supplemental retirement plan | 6,190 | 6,141 | ||||
| Deferred tax assets | 10,679 | 11,734 | ||||
| Other assets, net of amortization of $1,359 at both April 30, 2005 | ||||||
| and February 5, 2005 | 1,537 | 1,618 | ||||
|
|
|
|||||
| TOTAL ASSETS | $ | 130,775 | $ | 135,100 | ||
|
|
|
|||||
See accompanying notes.
1
| thousands, except share and per share data | April
30, 2005 (Unaudited) |
February 5, 2005 | ||||
|
|
|
|||||
| LIABILITIES | ||||||
| Current liabilities: | ||||||
| Current maturities of long-term debt | $ | 8,580 | $ | 8,580 | ||
| Accounts payable | 11,555 | 13,011 | ||||
| Accrued employment costs | 11,682 | 12,463 | ||||
| Customer deposit liability | 23,606 | 21,828 | ||||
| Accrued severance | 4,080 | 4,205 | ||||
| Income taxes payable | 2,641 | 2,872 | ||||
| Sales taxes payable | 1,094 | 1,886 | ||||
| Accrued advertising expenses | 1,297 | 1,568 | ||||
| Accrued expenses and other liabilities | 5,789 | 5,348 | ||||
|
|
|
|||||
| Total current liabilities | 70,324 | 71,761 | ||||
|
|
|
|||||
| Long-term debt, less current maturities | 17,058 | 17,050 | ||||
| Accrued pension obligations | 14,349 | 13,993 | ||||
| Supplemental retirement plan obligations | 4,550 | 4,512 | ||||
| Customer deposit liability | 3,971 | 4,334 | ||||
| Other liabilities | 163 | 564 | ||||
|
|
|
|||||
| Total liabilities | 110,415 | 112,214 | ||||
|
|
|
|||||
| STOCKHOLDERS’ EQUITY | ||||||
| Preferred stock, no par value, 1,000,000 shares authorized; no shares outstanding | — | — | ||||
| Preferred stock, Series A, no par value, 200,000 shares authorized; | ||||||
| no shares outstanding | — | — | ||||
| Common stock, $0.40 par value. 50,000,000 shares authorized; 18,476,718 and | ||||||
| 18,432,779 shares outstanding at April 30, 2005 and February 5, 2005, respectively | 7,391 | 7,373 | ||||
| Additional paid-in capital | 53,947 | 53,301 | ||||
| Retained earnings | 203,513 | 206,812 | ||||
| Accumulated other comprehensive loss | (10,567 | ) | (10,505 | ) | ||
|
|
|
|||||
| 254,284 | 256,981 | |||||
| Treasury stock - at cost, 10,639,543 and 10,672,236 at April 30, 2005 and | ||||||
| February 5, 2005, respectively | (233,541 | ) | (234,031 | ) | ||
| Unamortized deferred compensation- restricted stock | (383 | ) | (64 | ) | ||
|
|
|
|||||
| Total stockholders’ equity | 20,360 | 22,886 | ||||
|
|
|
|||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 130,775 | $ | 135,100 | ||
|
|
|
|||||
See accompanying notes.
2
CPI CORP.
Interim
Condensed Consolidated Statements of Operations
(Unaudited)
| 12 Weeks Ended | ||||||
|
|
||||||
| thousands, except share and per share data | April 30, 2005 | May 1, 2004 | ||||
|
|
|
|||||
| Net sales | $ | 55,804 | $ | 54,925 | ||
| Cost and expenses: | ||||||
| Cost of sales (exclusive of depreciation and amortization shown below) | 7,465 | 7,691 | ||||
| Selling, general and administrative expenses | 47,130 | 45,678 | ||||
| Depreciation and amortization | 4,273 | 3,861 | ||||
| Other charges and impairments | 109 | 9,563 | ||||
|
|
|
|||||
| 58,977 | 66,793 | |||||
|
|
|
|||||
| Loss from continuing operations | (3,173 | ) | (11,868 | ) | ||
| Interest expense | 451 | 599 | ||||
| Interest income | 175 | 281 | ||||
| Other income, net | 171 | 45 | ||||
|
|
|
|||||
| Loss from continuing operations before income tax benefit | (3,278 | ) | (12,141 | ) | ||
| Income tax benefit | 1,220 | 4,492 | ||||
|
|
|
|||||
| Net loss from continuing operations | (2,058 | ) | (7,649 | ) | ||
| Net loss from discontinued operations, net of income tax benefit | — | (1,149 | ) | |||
|
|
|
|||||
| NET LOSS | $ | (2,058 | ) | $ | (8,798 | ) |
|
|
|
|||||
| NET LOSS PER COMMON SHARE | ||||||
| Net loss per share from continuing operations - diluted | $ | (0.26 | ) | $ | (0.95 | ) |
| Net loss per share from discontinued operations - diluted | — | (0.14 | ) | |||
|
|
|
|||||
| Net loss per share - diluted | $ | (0.26 | ) | $ | (1.09 | ) |
|
|
|
|||||
| Net loss per share from continuing operations - basic | $ | (0.26 | ) | $ | (0.95 | ) |
| Net loss per share from discontinued operations - basic | — | (0.14 | ) | |||
|
|
|
|||||
| Net loss per share - basic | $ | (0.26 | ) | $ | (1.09 | ) |
|
|
|
|||||
| Dividends per share | $ | 0.16 | $ | 0.16 | ||
|
|
|
|||||
| Weighted average number of common and common | ||||||
| equivalent shares outstanding-diluted | 7,809,608 | 8,100,572 | ||||
|
|
|
|||||
| Weighted average number of common and common | ||||||
| equivalent shares outstanding-basic | 7,809,608 | 8,100,572 | ||||
|
|
|
|||||
See accompanying notes.
3
CPI CORP.
Interim
Condensed Consolidated Statement of Changes in Stockholders’ Equity
(Unaudited)
| thousands,
except share and per share data |
Common stock |
Additional paid-in capital |
Retained earnings |
Accumulated other comprehensive loss |
Treasury stock, at cost |
Deferred compensation - restricted stock |
Total | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||
| Balance at February 5, 2005 | $ | 7,373 | $ | 53,301 | $ | 206,812 | ($10,505 | ) | ($234,031 | ) | ($64 | ) | $ | 22,886 | |||||||
| Net loss | — | — | (2,058 | ) | — | — | — | (2,058 | ) | ||||||||||||
| Total other comprehensive loss | — | — | — | (62 | ) | — | — | (62 | ) | ||||||||||||
|
|
|||||||||||||||||||||
| Total comprehensive loss | — | — | — | — | — | — | |||||||||||||||