Fiscal
2003 Net Income Surges to Company Record
New York, New York (August 21,
2003)—Movie Star, Inc. (AMEX: MSI), today announced financial results for the
three months and full year ended June 30, 2003.
For
the fiscal 2003 fourth quarter, net sales increased 45 percent to $15,513,000
from $10,710,000 for the 2002 final quarter. Gross margin expanded 610 basis
points to 32.3 percent from 26.2 percent in 2002’s comparable period.
Fourth-quarter operating income from continuing operations rose sharply,
reaching $1,694,000 compared with last year’s $489,000 loss. Net income surged
dramatically during the fourth quarter to $1,049,000 from the net loss of
$329,000 a year ago. Earnings per diluted share were $0.07 versus a $0.02 loss
for the fourth quarter of 2002.
For
fiscal 2003, net sales increased more than 19 percent to $64,916,000 compared
with $54,359,000 a year ago. Gross margin expanded 370 basis points to 31.7
percent from 28.0 percent for fiscal 2002. Operating income from continuing
operations increased 293 percent to $5,948,000 from $1,513,000 in fiscal 2002.
Net income from continuing operations for fiscal 2003 increased significantly,
reaching $3,431,000 up from $461,000 last year, and
earnings per diluted share were $0.22 compared with $0.03 from continuing
operations a year ago.
Total debt declined 45 percent during the
fiscal year. At June 30, 2003, total debt was $2,304,000, down from $4,199,000
at the start of the fiscal year, and shareholders’ equity increased
approximately 27 percent to $17,264,000 from $13,624,000 at June 30, 2002.
“These robust
results reflect sharply higher sales volume combined with much better margins
resulting from improved sourcing,” stated Chief Executive Officer Mel Knigin.
“Moreover, our disciplined cost-control initiatives, that which included
streamlining our distribution and making additional efficiency improvements
throughout the organization, culminated in the most profitable year in the
Company’s history.
“We are
pleased,
that, despite the very challenging economic environment, the efforts expended
over the past several quarters yielded tangible results for our bottom line
while simultaneously strengthening our balance sheet. Looking ahead to the first half of fiscal 2004,
there is a continued healthy demand for our
products and open orders for the first half of fiscal 2004 are
comparable to the first half of fiscal 2003,Looking ahead to the first half
of fiscal 2004, there is a continued healthy demand for our products, and open orders for the first
half of fiscal 2004 are comparable to the first half of fiscal 2003,"
concluded Mr. Knigin.
Page 2
August 21, 2003
MOVIE
STAR, INC., produces and sells ladies sleepwear, robes, leisurewear,
loungewear, panties and daywear.
Certain
of the matters set forth in this press release are forward-looking and involve
a number of risks and uncertainties. Among the factors that could cause actual
results to differ materially are the following: business conditions and growth
in the industry; general economic conditions; addition or loss of significant
customers; the loss of key personnel; product development; competition; risks
of doing business abroad; foreign government regulations; fluctuations in
foreign rates; rising costs for raw materials and the unavailability of sources
of supply; the timing of orders booked; and the risk factors listed from time
to time in the Company’s SEC reports.
CONTACT: INVESTOR RELATIONS:
Movie Star, Inc. -or- SM Berger & Company, Inc.
Thomas Rende, CFO Matthew J. Dennis, CFA
(212) 798-4700 (216) 464-6400
[Tables follow]
Page 3
August 21, 2003
MOVIE STAR, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In
Thousands, Except Per Share Amounts)
|
|
Three Months Ended |
|
Fiscal Year Ended |
||||
|
|
June 30, |
|
June 30, |
||||
|
|
2003 |
|
2002 |
|
2003 |
|
2002 |
|
|
(Unaudited) |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
Net sales |
$15,513 |
|
$10,710 |
|
$64,916 |
|
$54,359 |
|
Cost of sales |
10,508 |
|
7,900 |
|
44,345 |
|
39,157 |
|
Gross profit |
5,005 |
|
2,810 |
|
20,571 |
|
15,202 |
|
Selling, general and administrative expenses |
3,311 |
|
3,299 |
|
14,623 |
|
13,689 |
|
Operating income
(loss) from continuing operations |
1,694 |
|
(489) |
|
5,948 |
|
1,513 |
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
63 |
|
78 |
|
347 |
|
692 |
|
Income (loss) from continuing operations
before income taxes |
1,631 |
|
(567) |
|
5,601 |
|
821 |
|
Income taxes (benefit) |
582 |
|
(195) |
|
2,170 |
|
360 |
|
Income (loss) from continuing operations |
1,049 |
|
(372) |
|
3,431 |
|
461 |
|
|
|
|
|
|
|
|
|
|
Gain on disposal of discontinued retail
stores, net of taxes |
- |
|
43 |
|
- |
|
86 |
|
Net income (loss) |
$ 1,049 |
|
$ (329) |
|
$ 3,431 |
|
$ 547 |
|
|
|
|
|
|
|
|
|
|
BASIC NET INCOME (LOSS) PER SHARE |
|
|
|
|
|
|
|
|
From continuing operations |
$.07 |
|
$(.02) |
|
$.23 |
|
$.03 |
|
From discontinued operations |
- |
|
- |
|
- |
|
.01 |
|
Net income (loss) per share |
$.07 |
|
$(.02) |
|
$.23 |
|
$.04 |
|
|
|
|
|
|
|
|
|
|
DILUTED NET INCOME (LOSS) PER SHARE |
|
|
|
|
|
|
|
|
From continuing operations |
$.07 |
|
$(.02) |
|
$.22 |
|
$.03 |
|
From discontinued operations |
- |
|
- |
|
- |
|
.01 |
|
Net income (loss) per share |
$.07 |
|
$(.02) |
|
$.22 |
|
$.04 |
|
|
|
|
|
|
|
|
|
|
Basic weighted average number of shares
outstanding |
15,275 |
|
15,085 |
|
15,133 |
|
15,085 |
|
Diluted weighted average number of shares
outstanding |
15,977 |
|
15,097 |
|
15,407 |
|
15,112 |
Page 4
August 21, 2003
MOVIE STAR, INC.
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Number of Shares)
|
June 30, |
|
June
30, |
|
2003 |
|
2002 |
|
|
|
|
ASSETS
|
Current
Assets |
|
|
|
|
Cash |
$
219 |
|
$
215 |
|
Receivables, net |
8,992 |
|
7,001 |
|
Inventory |
10,392 |
|
8,797 |
|
Deferred income taxes |
2,511 |
|
1,842 |
|
Prepaid expenses and other current assets |
365 |
|
202 |
|
Total current assets |
22,479 |
|
18,057 |
|
|
|
|
|
|
Property,
plant and equipment, net |
1,153 |
|
1,350 |
|
Deferred
Income taxes |
50 |
|
2,662 |
|
Other
assets |
407 |
|
337 |
|
|
|
|
|
|
Total assets |
$24,089 |
|
$22,406 |
LIABILITIES AND
SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
Current
Liabilities |
|
|
|
|
Notes payable |
$ 2,277 |
|
$ 4,129 |
|
Current maturities of capital lease
obligations |
27 |
|
40 |
|
Accounts payable |
2,888 |
|
3,355 |
|
Accrued expenses and other current
liabilities |
1,308 |
|
1,004 |
|
Total current liabilities |
6,500 |
|
8,528 |
|
|
|
|
|
|
Capital
lease obligations |
- |
|
30 |
|
|
|
|
|
|
Deferred
lease liability |
224 |
|
140 |
|
|
|
|
|
|
Other
long-term liability |
101 |
|
84 |
|
|
|
|
|
|
Shareholders’
equity |
|
|
|
|
Common
stock $.01 par value – authorized
30,000,000 shares; issued 17,412,000 shares in 2003 and 17,102,000 shares in
2002 |
174 |
|
171 |
|
Additional paid-in capital |
4,353 |
|
4,147 |
|
Retained earnings |
16,355 |
|
12,924 |
|
|
20,882 |
|
17,242 |
|
|
|
|
|
|
Less: Treasury stock, at cost – 2,017,000
shares |
3,618 |
|
3,618 |
|
Total shareholders’ equity |
17,264 |
|
13,624 |
|
|
|
|
|
|
Total
liabilities and shareholders’ equity |
$24,089 |
|
$22,406 |