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Second Quarter Results
Total revenues for the second quarter of 2011 increased 2.0% to
Net income for the quarter decreased to
Adjusted EBITDA for the second quarter of 2011 was
"During the second quarter we experienced very strong sales in our retail stores," said
Year-to-Date Results
For the first six months of 2011, total revenues increased 4.0% to
Adjusted EBITDA for the first six months of 2011 increased 35.8% to
A reconciliation of the net income calculated in accordance with GAAP and the non-GAAP adjusted EBITDA measure is provided in the table accompanying this earnings release.
A reconciliation of the net income calculated in accordance with GAAP and the non-GAAP Adjusted IBT measure is provided in the table accompanying this earnings release.
Business Outlook 2011
Until there is greater long-term visibility on sustainable economic conditions and consumer behavior, the Company is not providing guidance on business prospects in 2011.
Today's Teleconference and Webcast
About
For more information, please call 1-978-952-8062 or visit www.DoverSaddlery.com.
Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning of section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including without limitation statements made about the Company's business outlook for fiscal 2011, the prospects for continued retail channel and same store sales growth, and operating income and cash flow improvements. All statements other than statements of historical fact included in this press release regarding the Company's strategies, plans, objectives, expectations, and future operating results are forward-looking statements. Although Dover believes that the expectations reflected in such forward-looking statements are reasonable at this time, it can give no assurance that such expectations will prove to have been correct. These forward-looking statements involve significant risks
and uncertainties, including those discussed in this release and others that can be found in "Item 1A Risk Factors" of Dover Saddler's Annual Report on Form 10-K for the fiscal year ended
DOVER SADDLERY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
2011 2010 2011 2010
Revenues, net - direct $ 12,172 $ 12,901 $ 24,240 $ 24,603
Revenues, net - retail
stores 8,075 6,954 13,293 11,478
---------- ---------- ---------- ----------
Revenues, net - total $ 20,247 $ 19,855 $ 37,533 $ 36,081
Cost of revenues 12,767 12,404 23,484 22,783
---------- ---------- ---------- ----------
Gross profit 7,480 7,451 14,049 13,298
Selling, general and
administrative expenses 6,306 6,163 12,227 12,056
---------- ---------- ---------- ----------
Income from operations 1,174 1,288 1,822 1,242
Interest expense, financing
and other related costs,
net 103 259 477 510
Other investment income (37) (423) (16) (420)
---------- ---------- ---------- ----------
Income before income tax
provision 1,108 1,452 1,361 1,152
Provision for income taxes 481 583 609 475
---------- ---------- ---------- ----------
Net income $ 627 $ 869 $ 752 $ 677
========== ========== ========== ==========
Net income per share
Basic $ 0.12 $ 0.16 $ 0.14 $ 0.13
========== ========== ========== ==========
Diluted $ 0.12 $ 0.16 $ 0.14 $ 0.12
========== ========== ========== ==========
Number of shares used in per
share calculation
Basic 5,288,000 5,268,000 5,287,000 5,266,000
Diluted 5,413,000 5,454,000 5,339,000 5,425,000
Other Operating Data:
Number of retail stores(1) 14 13 14 13
Capital expenditures 281 183 402 214
Gross profit margin 36.9% 37.5% 37.4% 36.9%
(1) Includes thirteen Dover-branded stores and one Smith Brothers store.
The Parker, CO Dover-branded store opened in Q2 2011.
DOVER SADDLERY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
(unaudited)
June 30, Dec. 31,
2011 2010
ASSETS
Current assets:
Cash and cash equivalents $ 295 $ 745
Accounts receivable 826 533
Inventory 18,285 15,869
Prepaid catalog costs 904 930
Prepaid expenses and other current assets 1,070 901
Deferred income taxes 117 105
-------- --------
Total current assets 21,497 19,083
Net property and equipment 3,062 3,025
Other assets:
Deferred income taxes 943 848
Intangibles and other assets, net 576 593
-------- --------
Total other assets 1,519 1,441
-------- --------
Total assets $ 26,078 $ 23,549
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of capital lease $ 97 $ 97
Accounts payable 1,924 2,073
Accrued expenses and other current liabilities 3,862 5,425
Income taxes payable 79 414
-------- --------
Total current liabilities 5,962 8,009
Long-term liabilities:
Revolving line of credit 3,450 --
Term note 5,500 --
Subordinated notes payable, net -- 5,293
Capital lease obligation, net of current portion 46 89
Interest rate swap derivative 174 --
-------- --------
Total long-term liabilities 9,170 5,382
Stockholders' equity:
Common stock, par value $0.0001 per share; 15,000,000
shares authorized; issued 5,288,027 as of June 30,
2011 and 5,277,161 as of December 31, 2010 ,
respectively 1 1
Additional paid in capital 45,530 45,391
Treasury stock, 795,865 shares at cost (6,082) (6,082)
Other comprehensive loss (103) --
Accumulated deficit (28,400) (29,152)
-------- --------
Total stockholders' equity 10,946 10,158
-------- --------
Total liabilities and stockholders' equity $ 26,078 $ 23,549
======== ========
Non-GAAP Financial Measures and Information
From time to time, in addition to financial results determined in accordance with generally accepted accounting principles in
When we use the term "Adjusted EBITDA," we are referring to net income minus interest income, investment income and other income plus interest expense, income taxes, non-cash stock-based compensation, depreciation, amortization and other investment loss. We present Adjusted EBITDA because we consider it an important measure of our performance and believe it is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry.
The following table reconciles net income to Adjusted EBITDA (in thousands):
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
2011 2010 2011 2010
Net income $ 627 $ 869 $ 752 $ 677
Depreciation 184 183 365 369
Amortization of intangible
assets 2 2 4 3
Stock-based compensation 62 45 124 91
Interest expense, financing and
other related costs, net 103 259 477 510
Other investment income (37) (423) (16) (420)
Provision for income taxes 481 583 609 475
--------- --------- --------- ---------
Adjusted EBITDA $ 1,422 $ 1,518 $ 2,315 $ 1,705
========= ========= ========= =========
When we use the term Adjusted income before taxes ("Adjusted IBT"), we are referring to net income minus income taxes and non-recurring other investment income or losses. The Company recognizes this is a non-GAAP measure; however, we present Adjusted IBT because we consider it an important measure of our performance.
The following table reconciles net income to Adjusted IBT (in thousands):
Three Months Ended Six Months Ended
June 30, June 30, June 30, June 30,
2011 2010 2011 2010
Net income $ 627 $ 869 $ 752 $ 677
Insurance settlement from the
Hobby Horse investment -- (402) -- (402)
Provision for income taxes 481 583 609 475
---------- --------- ---------- ---------
Adjusted IBT $ 1,108 $ 1,050 $ 1,361 $ 750
========== ========= ========== =========
Janet Nittmann Email Contact Tel 978-952-8062 x218
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