WESTLAKE VILLAGE, Calif., June 18, 2001 (PRIMEZONE) -- The Right Start, Inc. (Nasdaq:RTST), today announced results for its first quarter ended May 5, 2001.
Retail sales for the thirteen-week period were $11,004,000, an increase of 6.5% over retail sales of $10,329,000 for the thirteen weeks ended April 29, 2000. Same store sales, or sales for stores open at least 14 months, decreased 4.1%.
For the first quarter, the Company's consolidated earnings, before interest, taxes, depreciation and amortization, and before new store pre-opening costs, non-cash compensation and executive severance expense (EBITDA), consisted of a loss of $327,000, compared to income of $30,000 last year.
Jerry R. Welch, Chairman and CEO, said, "The first quarter retailing environment for kids products was difficult. Due to the bankruptcy filings and accompanying liquidation of inventories by E-Toys, Baby Center, Natural Wonders and Store of Knowledge, our same store sales were adversely impacted. This effect was primarily felt in our 26 regional mall stores whose same store sales were down 10.1% for the quarter. Although our neighborhood street locations were also affected, they still turned in an excellent performance with an increase in same store sales of 8.1%."
For the quarter, the Company reported that it opened 4 new neighborhood street locations in Dallas, Austin and San Diego, ending the quarter with 65 stores in operation. Currently, the Company's store mix consists of 26 regional mall locations and 39 neighborhood street locations. Since 1997, the Company has exclusively focused on its street store concept for new store growth.
About Right Start
The Right Start, Inc. is the largest, national specialty retailer of high quality developmental, educational and care products for infants and children through age 4. The Right Start brand originated in 1985 through the creation of the award-winning Right Start Catalog(. The Right Start now operates 65 retail stores nationwide.
About RightStart.com
RightStart.com is a leading online specialty retailer for infants and children and currently operates the Right Start Catalog(tm). RightStart.com is dedicated to providing customers with a unique online shopping experience by offering an assortment of trusted products carefully selected with regard to quality and developmental and educational value.
The companies are based in Westlake Village, CA.
This press release may contain certain forward-looking statements with respect to the financial condition, results of operations and expansion projects of The Right Start that may be impacted by factors including, but not limited to, the availability of capital, competition from other retailers and potential product liability claims and other risks included in The Right Start's filings with the Securities and Exchange Commission including, but not limited to, The Right Start's Registration Statement on Form S-3 (File No. 333-84319), its Annual Report of Form 10-K for the fiscal year ended February 3, 2001 and its quarterly reports.
THE RIGHT START, INC.
STATEMENT OF OPERATIONS
(unaudited)
Thirteen weeks ended
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May 5, 2001 April 29, 2000
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Retail store sales $ 11,004,000 $ 10,329,000
Sales to RightStart.com 1,718,000 2,926,000
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Net sales 12,722,000 13,255,000
Costs and expenses:
Cost of goods sold - merchandise 5,543,000 5,061,000
Cost of goods sold to RightStart.com 1,718,000 2,926,000
Operating expense 4,680,000 4,034,000
Marketing and advertising expense 144,000 249,000
General and administrative expense 964,000 955,000
Non-cash compensation expense 30,000 11,000
Executive severance expense 78,000 --
Pre-opening costs 83,000 156,000
Depreciation and amortization expense 636,000 540,000
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Operating loss (1,154,000) (677,000)
Loss on investment in RightStart.com -- 3,750,000
Interest expense 221,000 241,000
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Pre-tax loss (1,375,000) (4,668,000)
Income tax provision 12,000 20,000
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Net loss$ (1,387,000) $ (4,688,000)
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Basic loss per share $ (0.28) $ (0.86)
Basic weighted average number
of shares outstanding 5,617,275 5,542,856