SAINTE-JULIE, QUEBEC--(Marketwired - Jun 13, 2013) - In the first quarter of 2013, Groupe Bikini Village inc. (GBV.TO) ("Groupe Bikini Village" or the "Corporation")'s sales declined compared to the first quarter of 2012. In addition to the ongoing challenging retail conditions experienced in the fourth quarter of fiscal 2012 and in February 2013, sales were also negatively impacted by a shift of one week in the fiscal calendar. Due to the 53rd week in fiscal 2012, the 13 weeks of the first quarter in fiscal 2013 are not the same weeks reported in the first quarter of 2012 (the Corporation's first quarter began a week later this year). The result of this shift, combined with the seasonal fluctuations normally present in the company's sales, is that the first quarter of 2013 loses one strong week of February sales (an average weekly run rate of $1 million) and gains one softer week of sales in May (an average weekly run rate of $0.4 million). In the second quarter, this situation will reverse, as the Corporation gains one strong week in early August (an average weekly run rate of $1 million) and loses one softer week in early May (an average weekly run rate of $0.4 million).
2013 first quarter results
Net sales for the first quarter, which began on February 3, 2013 and ended May 4, 2013, were $8.5 million, compared to $9.7 million in the first quarter of 2012, which ran January 29 through April 28 of that year. Due to the 53rd week in fiscal year 2012, the comparable sales result for the first quarter of fiscal 2013, which compares sales from the same number of stores year-over-year, covers a 13-week period ending May 5, 2012 as opposed to April 28, 2012. The Corporation's first quarter comparable sales decreased by 5.7%, due to the continuing challenging retail conditions experienced in the fourth quarter of 2012 and in the month of February. However, comparable sales have gradually strengthened throughout March and April.
The Corporation's operating loss (EBITDA1) for the first quarter of 2013 was $745,000, compared to operating margin (EBITDA1) of $109,000 for the same period in the previous year. The decrease in the operating margin is due to a decrease in the marginal contribution resulting essentially from lower sales volume and a decrease in gross margins owing to increased promotional activities.
For the first quarter ended May 4, 2013, the Corporation's net loss was $859,000 (($0.45) per share, basic and diluted), as compared to net loss of $300,000 (($0.16) per share, basic and diluted) for the first quarter ended April 28, 2012.
"We have undertaken immediate action to quickly recoup the first quarter of 2013's shortfall in sales (other than the temporary shortfall due to the one-week shift in the fiscal calendar)," said Yves Simard, Groupe Bikini Village inc. President and CEO. "Two leases that were scheduled to end in the first quarter were extended on favourable terms to cover the better-performing summer season. In addition, the opening of a store originally scheduled for the end of July was moved up to the beginning of May."
Simard said Groupe Bikini Village expects its market to remain challenging, highly-competitive and price-sensitive, which will continue to put pressure on comparable sales. "However, the changes and investments we have made in our retail network - and the resulting in-store experience it offers our customers - will still help us succeed," he said.
"We will continue our efforts to improve the shopping experience so we can attract new customers and continue to engage our existing customers," Simard said. "An outstanding customer experience is as important to our success as the high quality of our offers; these two factors are at the root of our ongoing strategies to bring more qualified customers, both new and returning, into our stores - and to inspire them to buy. These revenue-growth strategies, together with disciplined control of expenses, will allow us to build profitability and shareholder value."
"As we undertake these priorities, we will continue in our efforts to identify and take advantage of opportunities to create long-term value," he said.
Groupe Bikini Village inc.'s full first quarter 2013 report, as well as previous shareholder reports and other information of interest to investors, are available on SEDAR at www.sedar.com , and on the Corporation's website at www.bikinivillage.com
Groupe Bikini Village
Groupe Bikini Village inc., serving Canadians for more than a quarter-century, is a leader in the retail sale of beachwear products, with a network of new and renovated boutiques across Eastern Canada. In its bright and inviting stores with comfortable change rooms and knowledgeable staff, Groupe Bikini Village helps its customers choose from among Canada's widest selection of swimsuits, beach and cruise wear and accessories, in the most popular brands the industry has to offer and in styles to suit every figure. Headquartered in Sainte-Julie, Quebec, Groupe Bikini Village operates 55 stores and employs approximately 450 people; its securities trade on the Toronto Stock Exchange under the stock symbol GBV. For more information about Groupe Bikini Village, please visit our website at www.bikinivillage.com.
1 The term EBITDA (earnings before net finance costs, income taxes, depreciation, amortization, net impairment loss, reorganization fees and unusual items) does not have any standardized meaning prescribed by Canadian Generally Accepted Accounting Principles applicable to publicly accountable enterprises ("GAAP") and may not be comparable to similarly-titled measures presented by other companies. Please refer to the section of Groupe Bikini Village inc.'s MD&A for the for the three-month period ended May 4, 2013, dated June 13, 2013, entitled "Non-GAAP Financial Measures." It is available on SEDAR at www.sedar.com
2 To be read in conjunction with "Forward-looking statements" below.
This news release contains certain forward-looking statements concerning Groupe Bikini Village inc.'s future operations, economic performance, financial conditions and financing plans. These statements are based on certain assumptions and analyses made by management in light of their experience and their perception of historical trends, current conditions and expected future developments, as well as other factors they believe are appropriate under the circumstances. However, whether actual results and developments will conform to management's expectations and predictions is subject to a number of risks, uncertainties and assumptions. Consequently, all of the forward-looking statements made in this news release are qualified by these cautionary statements, and there can be no assurance that the results or developments anticipated by management will be realized or, even if substantially realized, that they will have the expected consequences or effects on the Corporation. Management undertakes no obligation and does not intend to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable law.
|GROUPE BIKINI VILLAGE INC. |
|STATEMENTS OF NET LOSS AND COMPREHENSIVE LOSS|
|(in thousands of Canadian dollars, except amounts related to shares)|
|Three months ended|
|May 4, 2013||April 28, 2012|
|Revenues||$ 8,478||$ 9,720|
|Cost of goods sold||3,893||4,100|
|Operating and administrative expenses||5,691||5,849|
|Net finance costs||66||169|
|Loss before income tax recovery||(1,172||)||(398||)|
|Income tax recovery||(313||)||(98||)|
|NET LOSS AND COMPREHENSIVE LOSS (1)||$ (859||)||$ (300||)|
|LOSS PER SHARE|
|Basic and diluted||(0.45||)||(0.16||)|
|Weighted average number of oustanding shares|
|Basic and diluted||1,912,230||1,910,597|
|(1) A reconciliation of net loss and comprehensive loss to loss before interest, taxes, depreciation and amortization ("EBITDA") is as follows:|
|Loss and comprehensive loss||$ (859||)||$ (300||)|
|Income tax recovery||(313||)||(98||)|
|Net finance costs||66||169|
|Depreciation and amortization of capital and intangible assets||361||338|
|EBITDA||$ (745||)||$ 109|