Build-A-Bear Workshop, Inc. (NYSE: BBW), an interactive entertainment
retailer, today announced that its Founder, Maxine Clark, has announced
her plan to retire as Chief Executive Bear (CEB). Ms. Clark, 63, will
continue in her current position until a successor has been named and a
successful transition has occurred. She will remain as a member of the
Build-A-Bear Workshop Board of Directors. The Company also
announced select preliminary unaudited fourth quarter fiscal 2012 store
and e-commerce sales results, as well as expectations for certain
balance sheet metrics at year end.
“Creating Build-A-Bear Workshop and nurturing the Company from a
fledgling start-up to a global retail brand has been one of the greatest
experiences of my professional life. I have met so many wonderful people
– associates and Guests – which made my decision to retire as CEB a
difficult one,” stated Maxine Clark, Chief Executive Bear. “Although our
business has experienced challenges over the past few years as consumers
have reduced discretionary purchases, our strategic plan and key
initiatives are beginning to work. I believe now is an opportune time to
attract a new chief executive to take this incredible brand forward and
for me to take my entrepreneurial experience and combine it with my
passion to improve public education in our region in a more significant
way. We have made great progress in education reform in the St. Louis
area, but more is needed so that all children have the chance to achieve
their dreams just as I have.”
“Maxine Clark has been the inspiration and driving force that resulted
in Build-A-Bear Workshop becoming a global retail entertainment brand,”
said Mary Lou Fiala, Non-Executive Chairman of the Board. “Through her
vision, Build-A-Bear Workshop has achieved status as a favorite brand
known to families worldwide. I am confident in our business plan. The
Board is working closely with Maxine and the executive team to achieve
our goals and execute our long term strategies.”
On a preliminary unaudited basis for the Fourth Quarter, the 13-weeks
ended December 29, 2012:
-
Consolidated comparable store sales are expected to decline 1.7%,
representing a marked improvement from the 11.1% decline in third
quarter fiscal 2012;
-
Comparable store sales in North America are expected to increase 1.5%
and decline 11.4% in Europe;
-
Consolidated e-commerce sales are expected to increase 14.0%,
excluding the impact of foreign exchange;
-
The six stores that feature the Company’s newly imagined store design
are expected to report an average 30% increase in sales in the fourth
quarter of 2012 from the fourth quarter of 2011; and
-
The Company noted that it strategically increased investment in SG&A
to support its long term growth strategies and that it expects a
reduction in its UK performance versus the 2011 fourth quarter. This
combined with anticipated nonrecurring charges are expected to have a
significant negative impact on fourth quarter profitability.
In addition:
-
Inventory at year end is expected to decline from the prior year end
on an average square foot basis; and
-
Cash at year end is expected to approximate $45 million.
The Company also remains on track to close 50 to 60 existing stores in
fiscal 2013 and fiscal 2014 to reach its optimal store base of 225 to
250 stores. These select store closures are expected to transfer
approximately 20% of sales to other stores in the same markets. In
addition, the Company continues to expect to relocate and remodel
between 40 to 50 existing locations in its new store design by year-end
2014.
The Company noted that it is in its normal year-end closing and review
procedures and the final results for the fourth quarter and fiscal year
2012, the 13-week and 52-week periods ended December 29, 2012, may
differ, subject to year-end closing procedures and/or adjustments and
should not be viewed as a substitute for annual financial statements
prepared in accordance with generally accepted accounting principles.
The Company expects to report full results for the fourth quarter and
2012 fiscal year on February 14, 2013.
“Our preliminary sales results point to an improved comparable store
sales performance versus the third quarter and included the continued
success of our six stores in our new store design, which experienced
average sales growth of 30%. In the UK, comparable store sales declined
driven by the ongoing challenging economic environment. This combined
with increased expenses and non-recurring charges are expected to
negatively impact our fourth quarter and full year operating performance
versus last year,” Ms. Clark continued. “As we begin 2013, we are
pleased to see our strategies begin to gain traction. During holiday our
increased brand marketing investment resulted in our Guests favoring the
Build-A-Bear Workshop experience as a gift for family and friends.
“This led to increased gift card sales in North America and the UK
during the fourth quarter and has translated into a notable improved
sales trend in the beginning of the first quarter as these cards are
redeemed. The actions we are taking to close and reposition stores
within markets, remodel existing stores to our successful new store
design and support the brand with a re-invigorated brand marketing
campaign are expected to position our Company for improved profitability
and growth. I am confident that our seasoned and committed leadership
team will take the Build-A-Bear Workshop brand to even greater heights
and equally grateful for the unwavering support of the Build-A-Bear
Workshop associates and Guests who helped me bring the vision for our
Company to life. They are truly the heart of our brand.”
About Build-A-Bear Workshop, Inc.
Build-A-Bear Workshop, Inc. is the only global company that offers an
interactive make-your-own stuffed animal retail-entertainment
experience. There are more than 400 Build-A-Bear Workshop stores
worldwide, including company-owned stores in the U.S., Puerto
Rico, Canada, the United Kingdom and Ireland, and franchise stores
in Europe, Asia, Australia, Africa, the Middle East, Mexico and South
America. Founded in St. Louis in 1997, Build-A-Bear Workshop is the
leader in interactive retail. Brands include make-your-own Major League
Baseball® mascot in-stadium locations, and Build-A-Dino® stores. Build-A-Bear
Workshop extends its in-store interactive experience online with its
award winning virtual world website at bearville.com™.
The company was named to the FORTUNE 100 Best Companies to Work For® list
for the fifth year in a row in 2013. Build-A-Bear Workshop (NYSE: BBW)
posted total revenue of $394.4 million in fiscal 2011. For more
information, call 888.560.BEAR (2327) or visit the company’s
award-winning website at buildabear.com®.
Trademarks
We would like to thank you for your interest in covering our business.
As you write your story, we would ask that you use our full
name: Build-A-Bear Workshop® and that when referencing
the process of making stuffed animals you use the word “make” not
“build.” Build-A-Bear Workshop is our well-known trade name and our
registered trademark of Build-A-Bear Retail Management, Inc.
Build-A-Bear Workshop® should only be used in capital letters
to refer to our products and services and should not be used as a verb.
Forward Looking Statements
This press release contains “forward-looking statements” (within the
meaning of the federal securities laws) which represent Build-A-Bear
Workshop expectations or beliefs with respect to future events. Our
actual results may differ materially from the results discussed in the
forward-looking statements. These risks and uncertainties include,
without limitation, those detailed under the caption “Risk Factors” in
our annual report on Form 10-K for the fiscal year ended December 31,
2011, as filed with the SEC, and the following: general global economic
conditions may continue to deteriorate, which could lead to
disproportionately reduced consumer demand for our products, which
represent relatively discretionary spending; customer traffic may
decrease in the shopping malls where we are located, on which we depend
to attract guests to our stores; we may be unable to generate interest
in and demand for our interactive retail experience, or to identify and
respond to consumer preferences in a timely fashion; our marketing and
on-line initiatives may not be effective in generating sufficient levels
of brand awareness and guest traffic; we may be unable to generate
comparable store sales growth; we may be unable to effectively operate
or manage the overall portfolio of our company-owned stores; we may be
unable to renew or replace our store leases, or enter into leases for
new stores on favorable terms or in favorable locations, or may violate
the terms of our current leases; the availability and costs of our
products could be adversely affected by risks associated with
international manufacturing and trade, including foreign currency
fluctuation; our products could become subject to recalls or product
liability claims that could adversely impact our financial performance
and harm our reputation among consumers; we are susceptible to
disruption in our inventory flow due to our reliance on a few vendors;
high petroleum products prices could increase our inventory
transportation costs and adversely affect our profitability; we may not
be able to operate our company-owned stores in the United Kingdom and
Ireland profitably; we may be unable to effectively manage our
international franchises or laws relating to those franchises may
change; we may improperly obtain or be unable to protect information
from our guests in violation of privacy or security laws or
expectations; we may suffer negative publicity or be sued due to
violations of labor laws or unethical practices by manufacturers of our
merchandise; we may suffer negative publicity or negative sales if the
non-proprietary toy products we sell in our stores do not meet our
quality or sales expectations; we may lose key personnel, be unable to
hire qualified additional personnel, or experience turnover of our
management team; we may be unable to operate our company-owned
distribution center efficiently or our third-party distribution center
providers may perform poorly; our market share could be adversely
affected by a significant, or increased, number of competitors; we may
fail to renew, register or otherwise protect our trademarks or other
intellectual property; poor global economic conditions could have a
material adverse effect on our liquidity and capital resources; we may
have disputes with, or be sued by, third parties for infringement or
misappropriation of their proprietary rights; fluctuations in our
quarterly results of operations could cause the price of our common
stock to substantially decline; and we may be unable to repurchase
shares of our common stock at the times or in the amounts we currently
anticipate or the results of the share repurchase program may not be as
beneficial as we currently anticipate. These risks, uncertainties and
other factors may adversely affect our business, growth, financial
condition or profitability, or subject us to potential liability, and
cause our actual results, performance or achievements to be materially
different from those expressed or implied by our forward-looking
statements. The Company undertakes no obligation to publicly update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
All other brand names, product names, or trademarks belong to their
respective holders.
