1115 Broadway,
Movie Star, Inc. Reports Fiscal 2005 First Quarter Financial Results
Sales for the
first quarter of fiscal 2005 compared with the same period last year decreased
approximately $4.0 million to $12.8 million.
This decrease was due primarily to a shift in
orders from the first quarter to the second quarter. Due to this shift in orders, shipments for
the second quarter will be significantly higher than the corresponding period
last year. However, some of the larger
orders to be shipped in the second quarter of fiscal 2005 are at a considerably
lower gross margin.
As
expected, due to the inclusion of the Sidney Bernstein & Son division, the
gross profit margin percentage declined to 29.9% from last year’s first quarter
of 31.4%. Absent the Sidney Bernstein
& Son division, the Company’s gross margin was 31.3%. The Company recorded a net loss for the first
quarter of fiscal 2005 of $230,000, or $0.01 per share, compared with net
income of $853,000, or $0.05 per diluted share, for the first quarter of fiscal
2004.
Mel
Knigin, President and Chief Executive Officer, stated: “During the first
quarter we began building our inventory to fill orders for the second quarter,
which will bring our sales total for the six months ahead of last year’s
comparable six-month period. We expect
there will be a noticeable improvement in the 2005 fiscal second quarter results
which should compare favorably with the comparable period last year.
“As
we enter the second quarter with a strong balance sheet, we are quite
optimistic about our future. The
addition of the Sidney Bernstein & Son division has been very positive and
we expect that it will continue to have a positive impact throughout the
remainder of the fiscal year. We are
continuously working hard to improve our business and explore strategies
and opportunities that will diversify and strengthen our
Company.”
Page
2
November
10, 2004
MOVIE
STAR, INC. produces and sells ladies apparel, including sleepwear, robes,
leisurewear, and daywear. Current
collections include the Cinema Etoile
premium line of intimate apparel and the Movie
Star line of apparel sold as private label programs.
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 Stanley Berger
(212)
798-4700 (216) 464-6400
[Tables
follow]
Page 3
November 10, 2004
CONDENSED BALANCE SHEETS
(In
Thousands, Except Number of Shares)
|
September 30, |
June 30, |
September 30, |
|
2004
(Unaudited) |
2004* |
2003
(Unaudited) |
Assets
|
Current Assets |
|
|
|
|
Cash |
$
354 |
$
2,527 |
$
228 |
|
Receivables, net |
10,642 |
7,577 |
12,068 |
|
Inventory |
14,381 |
5,938 |
9,505 |
|
Deferred income taxes |
2,702 |
2,571 |
2,028 |
|
Prepaid expenses and other current assets |
631 |
588 |
426 |
|
Total current assets |
28,710 |
19,201 |
24,255 |
|
|
|
|
|
|
Property,
plant and equipment, net |
1,093 |
1,021 |
1,094 |
|
Deferred
income taxes |
148 |
148 |
50 |
|
Goodwill |
537 |
- |
- |
|
Other
assets |
440 |
409 |
403 |
|
|
|
|
|
|
Total assets |
$30,928 |
$20,779 |
$25,802 |
Liabilities and Shareholders’ Equity
|
Current
Liabilities |
|
|
|
|
Notes payable |
$10,142 |
$ - |
$ 4,020 |
|
Current maturities of capital lease
obligations |
- |
- |
17 |
|
Accounts payable and other current
liabilities |
2,864 |
2,658 |
3,194 |
|
Total current liabilities |
13,006 |
2,658 |
7,231 |
|
|
|
|
|
|
Long-term
liabilities |
379 |
374 |
337 |
|
|
|
|
|
|
Commitments
and Contingencies |
- |
- |
- |
|
|
|
|
|
|
Shareholders’
equity |
|
|
|
|
Common stock, $.01 par value – authorized
30,000,000 shares; |
|
|
|
|
issued 17,637,000 shares in September 2004, 17,617,000 in June 2004 and 17,592,000 in September 2003 |
176 |
176 |
176 |
|
Additional paid-in capital |
4,729 |
4,706 |
4,468 |
|
Retained earnings |
16,253 |
16,483 |
17,208 |
|
Accumulated other comprehensive income |
3 |
- |
- |
|
Treasury stock, at cost—2,017,000 shares |
(3,618) |
(3,618) |
(3,618) |
|
Total shareholders’ equity |
17,543 |
17,747 |
18,234 |
|
|
|
|
|
|
Total
liabilities and shareholders’ equity |
$30,928 |
$20,779 |
$25,802 |
|
|
|
|
|
* Derived from audited financial statements.
See notes to condensed unaudited financial statements.
Page 4
November 10, 2004
MOVIE STAR, INC.
STATEMENTS
OF OPERATIONS
(Unaudited)
(In
Thousands, Except Per Share Amounts)
|
Three
Months Ended |
|
September 30, |
|
2004 2003 |
|
Net sales |
$12,830 |
$16,826 |
|
Cost of sales |
9,000 |
11,544 |
|
Gross profit |
3,830 |
5,282 |
|
|
|
|
|
Selling, general and administrative expenses |
4,181 |
3,819 |
|
|
|
|
|
(Loss) income from operations |
(351) |
1,463 |
|
|
|
|
|
Interest income |
- |
- |
|
Interest expense |
33 |
42 |
|
|
|
|
|
(Loss) income before income taxes |
(384) |
1,421 |
|
Income taxes |
(154) |
568 |
|
|
|
|
|
Net (loss) income |
$
(230) |
$
853 |
|
|
|
|
|
BASIC NET (LOSS) INCOME PER SHARE |
$(.01) |
$.06 |
|
|
|
|
|
DILUTED NET (LOSS) INCOME PER
SHARE |
$(.01) |
$.05 |
|
|
|
|
|
Basic weighted average number of shares outstanding |
15,617 |
15,502 |
|
Diluted weighted average number of shares outstanding |
15,617 |
16,211 |
|
|
|
|
See notes to condensed unaudited financial
statements.