1-800-FLOWERS.COM, Inc. Reports Continued Positive Trends in Top and Bottom-Line Growth for Its Fiscal 2013 Second Quarter

Thu Jan 31, 2013 6:30am EST

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* Company reports revenue growth in all three of its business segments with
total revenue for the quarter increasing 5.5 percent to $253.0 million led by
growth of 8.9 percent in its Gourmet Food and Gift Baskets segment.
* Adjusted EBITDA from continuing operations increased 3.6 percent to $31.8
million compared with $30.7 million in the prior year period
* Net Income and EPS from continuing operations increased 12.0 percent and 9.0
percent, to $16.0 million and $0.24 per diluted share, respectively, compared
with adjusted net income from continuing operations of $14.3 million and EPS of
$0.22 per diluted share in the prior year period.

CARLE PLACE, N.Y.--(Business Wire)--
1-800-FLOWERS.COM, Inc. (NASDAQ: FLWS), the world`s leading florist and gift
shop, today reported revenues from continuing operations of $253.0 million for
its fiscal 2013 second quarter ended December 30, 2012, compared with revenues
from continuing operations of $239.8 million in the prior year period. The
Company said the 5.5 percent increase, or $13.2 million, reflected growth across
all three of its business segments, driven primarily by its Gourmet Food and
Gift Baskets segment, which grew 8.9 percent, or $11.6 million, to $142.7
million compared with $131.1 million in the prior year period. 

Gross profit margin for the quarter was 41.3 percent compared with 41.8 percent
in the prior year period, primarily reflecting product mix associated with
strong wholesale gift basket growth in the Company`s Gourmet Food and Gift
Baskets segment. Operating expenses as a percent of revenue improved 60 basis
points to 31.0 percent compared with 31.6 percent in the prior year period. The
improved operating expense ratio primarily reflects the increased revenues for
the quarter as well as the Company`s continued focus on improving leverage
across its business platform. 

Adjusted EBITDA from continuing operations for the quarter increased 3.6 percent
to $31.8 million compared with Adjusted EBITDA of $30.7 million in the prior
year period. Net income from continuing operations was $16.0 million, or $0.24
per diluted share, compared with adjusted net income from continuing operations
of $14.3 million, or $0.22 per diluted share, in the prior year period. 

Jim McCann, CEO of 1-800-FLOWERS.COM, said, "During the fiscal second quarter we
achieved top and bottom line growth in all three of our business segments,
continuing a trend that we have seen for two years now. This was achieved
despite a combination of the significant headwinds that characterized the
quarter, including the impacts of Superstorm Sandy on deliveries and customer
demand and the effects of weakening consumer confidence, particularly in
December, stemming from worries over the "fiscal cliff." 

"Despite these issues, we achieved revenue growth of 5.5 percent, driven
primarily by our Gourmet Food and Gift Basket segment. In this area, we saw a
rebound, both top and bottom-line, in our wholesale gift baskets business, after
several years of declines in this area, as well as strong ecommerce growth in
our Cheryl`s bakery gifts, Fannie May Fine Chocolates and The Popcorn Factory
brands, somewhat offset by lower results in our Fannie May retail and wholesale
operations. In our 1-800-FLOWERS.COM consumer floral and BloomNet wire service
businesses, we achieved enhanced bottom-line contributions on modest revenue
growth reflecting our continued focus on enhanced merchandising and marketing
programs to drive higher gross profit margins and effective management of
operating expenses." 

During the fiscal second quarter, the Company attracted 612,000 new customers.
Approximately 1.6 million customers placed orders during the quarter, of whom 61
percent were repeat customers. This reflects the Company`s successful efforts to
engage with its customers and deepen its relationships as their trusted Florist
and Gift Shop for all of their celebratory occasions. 

McCann also noted that the company has continued to strengthen its balance
sheet, finishing the second quarter with $27.0 million in cash and total debt of
approximately $21.8 million, resulting in a net positive cash position which the
Company expects to build upon during the second half of fiscal 2013. "Our cash
position at the end of the second quarter also reflects the more than $5 million
we have spent buying back our stock since the start of the fiscal year," said
McCann. "The strength of our balance sheet and the increasing cash flows we are
generating, provide us with significant flexibility to grow our business and
build shareholder value. We view our stock repurchase program as one component
of our strategy for cash uses and an effective way of providing value for our
shareholders. As such, we expect to continue to be in the market, buying back
shares, during the second half of the fiscal year." 

McCann noted that the second half of the Company`s fiscal year, beginning in
January, is more floral in nature due to the Valentine, Easter and Mother`s Day
holidays as well as other spring gifting occasions. "During our second half, we
expect to achieve year-over-year growth in revenues, gross margin and
contribution margin driven primarily by our core 1-800-FLOWERS.COM Consumer
Floral and BloomNet Wire Services businesses." McCann added that the majority of
this growth would likely occur during its fiscal third quarter, reflecting the
shift of the Easter holiday into the period versus the prior year when it fell
in the Company`s fiscal fourth quarter. 

"Based on the deepening relationships we have with our customers who continue to
embrace our truly original product offerings - such as our hit "A-Dog-Able®"
floral gift line and our new FM Berries® (incredible, fresh strawberries dipped
in real Fannie May® chocolate), we believe we are well positioned to build on
the positive trends we have been seeing in our business for several years now
and build long-term shareholder value," he said. 

SEGMENT RESULTS FROM CONTINUING OPERATIONS: 

The Company provides selected financial results for its Consumer Floral,
BloomNet and Gourmet Foods and Gift Baskets business segments in the tables
attached to this release and as follows:

* 1-800-FLOWERS.COM Consumer Floral: During the fiscal 2013 second quarter,
revenues in this segment grew 1.0 percent to $91.8 million compared with $91.0
million in the prior year period. This segment was the most impacted of the
Company`s businesses by Superstorm Sandy which affected deliveries as well as
customer ordering capabilities throughout the Northeast. Revenue growth in this
segment was also affected by softer demand reflecting declines in the closely
followed Consumer Confidence Index, particularly in December, stemming from
worries over the "fiscal cliff." Gross profit margin for the fiscal second
quarter increased 20 basis points to 39.2 percent compared with 39.0 percent in
last year`s second quarter. Segment contribution margin increased 3.0 percent,
to $10.3 million compared with $10.0 million in the prior year period. (The
Company defines Segment Contribution Margin as earnings before interest, taxes,
depreciation and amortization and before allocation of corporate overhead
expenses.) 
* BloomNet Wire Service: Revenues increased 2.5 percent to $18.7 million
compared with $18.3 million in the prior year period, also reflecting the impact
of Superstorm Sandy on wholesale product orders from florists. Gross margin for
the quarter increased 310 basis points to 52.3 percent compared with 49.2
percent in the prior year period, primarily reflecting product and service mix.
Segment contribution margin increased 19.2 percent to $6.0 million compared with
$5.1 million in the prior year period. 
* Gourmet Food and Gift Baskets: Revenues increased 8.9 percent to $142.7
million compared with $131.1 million in the prior year period. This was driven
primarily by a rebound in wholesale gift baskets sales into the Mass channel,
after several years of declines in this area. Ecommerce revenues also showed
strong growth, particularly in the Company`s Cheryl`s bakery gifts, Fannie May
Fine Chocolates and The Popcorn Factory brands. This was somewhat offset by
lower sales in Fannie May retail and wholesale channels, reflecting both the
economic headwinds and weather impacts during the quarter. Gross margin was 41.0
percent compared with 42.4 percent, primarily reflecting product mix as well as
operational issues associated with the relocation of a warehouse and
distribution facility prior to the holiday season. Segment contribution margin
increased 1.9 percent to $26.9 million compared with $26.4 million in the prior
year period excluding the $3.8 million gain on the sale of 17 Fannie May stores
to a new franchisee. This reflects the solid revenue growth during the quarter
somewhat offset by the aforementioned lower gross margin percentage and higher
costs associated with operational issues.

Company Guidance:

The Company reiterated its top- and bottom-line guidance for fiscal 2013, saying
it continues to expect to achieve revenue growth across all three of its
business segments with consolidated revenue growth for the year anticipated to
be in the mid-single-digit range. Also, based on anticipated continued
improvements in gross profit margin and operating leverage, the Company expects
to achieve double-digit, year-over-year increases in EBITDA and EPS as well as
Free Cash Flow in excess of $20 million. 

Definitions:

* EBITDA: Net income (loss) before interest, taxes, depreciation, amortization.
Free Cash Flow: net cash provided by operating activities less capital
expenditures. Category contribution margin: earnings before interest, taxes,
depreciation and amortization, before the allocation of corporate overhead
expenses. The Company presents EBITDA and Adjusted EBITDA from continuing
operations because it considers such information meaningful supplemental
measures of its performance and believes such information is frequently used by
the investment community in the evaluation of similarly situated companies. The
Company also uses EBITDA and Adjusted EBITDA as factors used to determine the
total amount of incentive compensation available to be awarded to executive
officers and other employees. The Company`s credit agreement uses EBITDA and
Adjusted EBITDA to measure compliance with covenants such as interest coverage
and debt incurrence. EBITDA and Adjusted EBITDA are also used by the Company to
evaluate and price potential acquisition candidates. EBITDA, Adjusted EBITDA and
Free Cash Flow have limitations as analytical tools and should not be considered
in isolation or as a substitute for analysis of the Company's results as
reported under GAAP. Some of the limitations of EBITDA and Adjusted EBITDA are:
(a) EBITDA and Adjusted EBITDA do not reflect changes in, or cash requirements
for, the Company's working capital needs; (b) EBITDA and Adjusted EBITDA do not
reflect the significant interest expense, or the cash requirements necessary to
service interest or principal payments, on the Company's debts; and (c) although
depreciation and amortization are non-cash charges, the assets being depreciated
and amortized may have to be replaced in the future and EBITDA does not reflect
any cash requirements for such capital expenditures. EBITDA and Free Cash Flow
should only be used on a supplemental basis combined with GAAP results when
evaluating the Company's performance. 

About 1-800-FLOWERS.COM, Inc.

1-800-FLOWERS.COM, Inc. is the world`s leading florist and gift shop. For more
than 30 years, 1-800-FLOWERS (1-800-356-9377 or www.1800flowers.com) has been
helping deliver smiles for our customers with gifts for every occasion,
including fresh flowers and the finest selection of plants, gift baskets,
gourmet foods, confections, candles, balloons and plush stuffed animals. As
always, our 100% Smile Guarantee backs every gift. 1-800-FLOWERS.COM`s Mobile
Flower & Gift Center was named winner of the Mobile Shopping Summit`s "Best
Mobile Site of 2011." 1-800-FLOWERS.COM was also rated number one vs.
competitors for customer satisfaction by STELLAService and named by the
E-Tailing Group as one of only nine online retailers out of 100 benchmarked to
meet the criteria for Excellence in Online Customer Service. 1-800-FLOWERS.COM
has been honored in Internet Retailer`s "Hot 100: America`s Best Retail Web
Sites" for 2011. The Company`s BloomNet international floral wire service
(www.mybloomnet.net) provides a broad range of quality products and value-added
services designed to help professional florists grow their businesses
profitably. The 1-800-FLOWERS.COM "Gift Shop" also includes gourmet gifts such
as popcorn and specialty treats from The Popcorn Factory (1-800-541-2676 or
www.thepopcornfactory.com); cookies and baked gifts from Cheryl`s
(1-800-443-8124 or www.cheryls.com); premium chocolates and confections from
Fannie May confections brands (www.fanniemay.com and www.harrylondon.com); gift
baskets and towers from 1-800-Baskets.com (www.1800baskets.com); delicious
cut-fruit arrangements from FruitBouquets.com (www.fruitbouquets.com); wine
gifts from Winetasting.com (www.winetasting.com); ultra- premium meats from
Stockyards.com (www.stockyards.com); as well as exquisite, customizable
invitations and personal stationery from FineStationery.com
(www.finestationery.com). The Company`s Celebrations brand
(www.celebrations.com) is a new premier online destination for fabulous party
ideas and planning tips. 1-800-FLOWERS.COM, Inc. is involved in a broad range of
corporate social responsibility initiatives including continuous expansion and
enhancement of its environmentally-friendly "green" programs as well as various
philanthropic and charitable efforts. Shares in 1-800-FLOWERS.COM, Inc. are
traded on the NASDAQ Global Select Market, ticker symbol: FLWS. 

Special Note Regarding Forward-Looking Statements:

This press release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements represent the Company`s current expectations or beliefs concerning
future events and can generally be identified by the use of statements that
include words such as "estimate," "expects," "project," "believe," "anticipate,"
"intend," "plan," "foresee," "likely," "will," "target" or similar words or
phrases. Forward-looking statements include, but are not limited to, statements
regarding the Company`s expectations for: its ability to build on positive
trends including increases in revenue, gross margin and contribution margin in
its Consumer Floral business; its ability to achieve continued top and bottom
line growth in its BloomNet and Gourmet Food and Gift Baskets categories; its
ability to achieve its guidance for consolidated revenue growth for the full
year in mid-single digit range along with further improvement in gross profit
margin and double-digit year-over-year increases in EBITDA and EPS. These
forward-looking statements are subject to risks, uncertainties and other
factors, many of which are outside of the Company`s control, which could cause
actual results to differ materially from the results expressed or implied in the
forward- looking statements, including, among others: the Company`s ability to
leverage its operating platform and reduce operating expenses; its ability to
grow its 1-800-Baskets.com business; its ability to manage the seasonality of
its businesses; its ability to cost effectively acquire and retain customers;
the outcome of contingencies, including legal proceedings in the normal course
of business; its ability to compete against existing and new competitors; its
ability to manage expenses associated with sales and marketing and necessary
general and administrative and technology investments; its ability to reduce
promotional activities and achieve more efficient marketing programs; and
general consumer sentiment and economic conditions that may affect levels of
discretionary customer purchases of the Company`s products. The Company
undertakes no obligation to publicly update any of the forward-looking
statements, whether as a result of new information, future events or otherwise,
made in this release or in any of its SEC filings except as may be otherwise
stated by the Company. For a more detailed description of these and other risk
factors, please refer to the Company`s SEC filings including the Company`s
Annual Reports on Form 10-K and its Quarterly Reports on Form 10-Q.
Consequently, you should not consider any such list to be a complete set of all
potential risks and uncertainties. 

Conference Call:

The Company will conduct a conference call to discuss the above details and
attached financial results today, Thursday, January 31, 2013 at 11:00 a.m. (ET).
The call will be "web cast" live via the Internet and can be accessed from the
Investor Relations section of the 1-800-FLOWERS.COM web site at
www.1800flowersinc.com A recording of the call will be posted on the Investor
Relations section of the Company`s web site within two hours of the call`s
completion. A telephonic replay of the call can be accessed for 48 hours
beginning at 2:00 p.m. ET on the day of the call at: 1-855-859-2056 or
1-404-537-3406; Conference ID: 86548135. 

Note: Attached tables are an integral part of this press release without which
the information presented in this press release should be considered
incomplete.

                                                                                                                      
 1-800-FLOWERS.COM, Inc. and Subsidiaries                                                                             
 
Condensed Consolidated Balance Sheets                                                                               
 
(In thousands)                                                                                                      
                                                                                                                      
                                                                                December 30,          July 1,         
                                                                                2012                  2012            
                                                                                                                      
 Assets                                                                                                               
 Current assets:                                                                                                      
 Cash and equivalents                                                           $        26,964       $      28,854   
 Receivables, net                                                                        36,407              14,968   
 Inventories                                                                             58,435              55,744   
 Deferred tax assets                                                                     5,902               4,993    
 Prepaid and other                                                                       7,262               11,082   
 Current assets of discontinued operations                                               -                   100      
 Total current assets                                                           $        134,970      $      115,741  
                                                                                                                      
 Property, plant and equipment, net                                                      49,757              48,669   
 Goodwill                                                                                47,901              47,901   
 Other intangibles, net                                                                  40,412              41,838   
 Deferred income taxes                                                                   2,822               2,824    
 Other assets                                                                            9,283               7,875    
 Total assets                                                                   $        285,145      $      264,848  
                                                                                                                      
 Liabilities and stockholders` equity                                                                                 
 Current liabilities:                                                                                                 
 Accounts payable                                                               $        26,135       $      17,619   
 Accrued expenses                                                                        63,442              52,535   
 Current maturities of long-term debt and obligations under capital leases               17,250              15,756   
 Current liabilities of discontinued operations                                          59                  110      
 Total current liabilities                                                      $        106,886      $      86,020   
                                                                                                                      
 Long-term debt and obligations under capital leases                                     4,500               13,500   
 Other liabilities                                                                       3,368               3,580    
 Total liabilities                                                                       114,754             103,100  
 Total stockholders` equity                                                              170,391             161,748  
 Total liabilities and stockholders` equity                                     $        285,145      $      264,848  
                                                                                                                      


                                                                                                                                                                                         
                                                                                                                                                                                         
 1-800-FLOWERS.COM, Inc. and Subsidiaries                                                                                                                                                
 
Selected Financial Information                                                                                                                                                         
 
Consolidated Statements of Operations                                                                                                                                                  
 
(In thousands, except for per share data)                                                                                                                                              
                                                                                                                                                                                         
                                                                                     Three Months Ended                                 Six Months Ended                                 
                                                                                     December 30,                  January 1,           December 30,                January 1,           
                                                                                     2012                          2012                 2012                        2012                 
                                                                                                                                                                                         
 Net revenues:                                                                                                                                                                           
 E-commerce (combined online and telephonic)                                         $        172,629              $       165,130      $        254,090            $     243,920        
 Other                                                                                        80,387                       74,715                119,794                  113,123        
 Total net revenues                                                                           253,016                      239,845               373,884                  357,043        
 Cost of revenues                                                                             148,531                      139,519               219,762                  210,155        
 Gross profit                                                                                 104,485                      100,326               154,122                  146,888        
                                                                                                                                                                                         
 Operating expenses:                                                                                                                                                                     
 Marketing and sales                                                                          54,901                       53,020                87,891                   85,302         
 Technology and development                                                                   5,376                        4,854                 10,791                   9,606          
 General and administrative                                                                   13,679                       12,932                26,900                   25,291         
 Depreciation and amortization                                                                4,531                        4,929                 8,989                    9,831          
                                                                                                                                                                                         
 Total operating expenses                                                                     78,487                       75,735                134,571                  130,030        
                                                                                                                                                                                         
 Gain on sale of stores                                                                       -                            3,789                 -                        3,789          
                                                                                                                                                                                         
 Operating income                                                                             25,998                       28,380                19,551                   20,647         
                                                                                                                                                                                         
 Interest expense, net                                                                        559                          849                   861                      1,671          
                                                                                                                                                                                         
 Income from continuing operations before income taxes                                        25,439                       27,531                18,690                   18,976         
 Income tax expense from continuing operations                                                9,428                        10,955                7,285                    7,533          
 Income from continuing operations                                                            16,011                       16,576                11,405                   11,443         
                                                                                                                                                                                         
 Operating income from discontinued operations, net of tax                                    -                            63                    -                        (23      )     
 Gain on sale of discontinued operations, net of tax                                          -                            -                     -                        4,478          
 Income from discontinued operations                                                          -                            63                    -                        4,455          
                                                                                                                                                                                         
 Net income                                                                          $        16,011               $       16,639       $        11,405             $     15,898         
                                                                                                                                                                                         
 Net income per common share (basic)                                                                                                                                                     
 From continuing operations                                                          $        0.25                 $       0.26         $        0.18               $     0.18           
 From discontinued operations                                                                 -                            -                     -                        0.07           
 Net income per common share (basic)                                                 $        0.25                 $       0.26         $        0.18               $     0.25           
 Net income per common share (diluted)                                                                                                                                                   
 From continuing operations                                                          $        0.24                 $       0.25         $        0.17               $     0.17           
 From discontinued operations                                                                 -                            -                     -                        0.07           
 Net income per common share (diluted)                                               $        0.24                 $       0.25         $        0.17               $     0.24           
 Weighted average shares used in the calculation of net income per common share                                                                                                          
 Basic                                                                                        64,824                       64,841                64,665                   64,530         
 Diluted                                                                                      66,557                       66,050                66,695                   65,989         
                                                                                                                                                                                         


                                                                                                                               
 1-800-FLOWERS.COM, Inc. and Subsidiaries                                                                                      
 
Selected Financial Information                                                                                               
 
Consolidated Statements of Cash Flows                                                                                        
 
(In thousands)                                                                                                               
                                                                                                                               
                                                                         Six Months Ended                                      
                                                                         December 30,                     January 1,           
                                                                                2012                            2012           
                                                                                                                               
 Operating activities                                                                                                          
 Net income                                                              $      11,405                    $     15,898         
 Reconciliation of net income to net cash provided by operations:                                                              
 Operating activities of discontinued operations                                49                              1,112          
 Gain on sale of discontinued operations                                        -                               (8,953   )     
 Depreciation and amortization                                                  8,989                           9,831          
 Amortization of deferred financing costs                                       229                             229            
 Deferred income taxes                                                          (909     )                      6,032          
 Bad debt expense                                                               477                             327            
 Stock based compensation                                                       2,304                           2,380          
 Other non-cash items                                                           213                             97             
 Changes in operating items, excluding the effects of acquisitions:                                                            
 Receivables                                                                    (21,916  )                      (18,526  )     
 Inventories                                                                    (2,691   )                      (7,896   )     
 Prepaid and other                                                              3,820                           307            
 Accounts payable and accrued expenses                                          19,687                          16,214         
 Other assets                                                                   (306     )                      2,772          
 Other liabilities                                                              (212     )                      16             
 Net cash provided by operating activities                                      21,139                          19,840         
                                                                                                                               
 Investing activities                                                                                                          
 Acquisitions, net of cash acquired                                             -                               (4,336   )     
 Proceeds from sale of business                                                 -                               12,826         
 Capital expenditures                                                           (9,128   )                      (8,689   )     
 Purchase of investments                                                        (1,321   )                      (1,111   )     
 Other, net                                                                     34                              (299     )     
 Net cash used in investing activities                                          (10,415  )                      (1,609   )     
                                                                                                                               
 Financing activities                                                                                                          
 Acquisition of treasury stock                                                  (5,149   )                      (1,111   )     
 Proceeds from exercise of employee stock options                               83                              -              
 Proceeds from bank borrowings                                                  47,000                          56,000         
 Repayment of notes payable and bank borrowings                                 (54,500  )                      (63,500  )     
 Repayment of capital lease obligations                                         (48      )                      (984     )     
 Net cash used in financing activities                                          (12,614  )                      (9,595   )     
                                                                                                                               
 Net change in cash and equivalents                                             (1,890   )                      8,636          
 Cash and equivalents:                                                                                                         
 Beginning of period                                                            28,854                          21,442         
 End of period                                                           $      26,964                    $     30,078         


                                                                                                                                                                                                            
 1-800-FLOWERS.COM, Inc. and Subsidiaries                                                                                                                                                                   
 
Selected Financial Information                                                                                                                                                                            
 
Segment Information                                                                                                                                                                                       
 
(in thousands)                                                                                                                                                                                            
                                                                                                                                                                                                            
                                                    Three Months Ended                                                            Six Months Ended                                                          
                                                    December 30,                   January 1,                                     December 30,                   January 1,                                 
                                                           2012                          2012                   % Change                 2012                          2012                   % Change      
                                                                                                                                                                                                            
 Net revenues from continuing operations:                                                                                                                                                                   
 1-800-Flowers.com Consumer Floral                  $      91,826                  $     91,041                 0.9       %       $      164,603                 $     161,181                2.1       %   
 BloomNet Wire Service                                     18,734                        18,272                 2.5       %              38,501                        36,777                 4.7       %   
 Gourmet Food & Gift Baskets                               142,736                       131,100                8.9       %              171,142                       159,725                7.1       %   
 Corporate (*)                                             200                           189                    5.8       %              394                           376                    4.8       %   
 Intercompany eliminations                                 (480     )                    (757     )             36.6      %              (756     )                    (1,016   )             25.6      %   
 Total net revenues from continuing operations      $      253,016                 $     239,845                5.5       %       $      373,884                 $     357,043                4.7       %   
                                                                                                                                                                                                            


                                                                                                                                                                                                                    
                                                    Three Months Ended                                                                Six Months Ended                                                              
                                                    December 30,                       January 1,                                     December 30,                       January 1,                                 
                                                           2012                              2012                   % Change                 2012                              2012                   % Change      
                                                                                                                                                                                                                    
 Gross profit from continuing operations:                                                                                                                                                                           
 1-800-Flowers.com Consumer Floral                  $      35,954                      $     35,524                 1.2       %       $      64,246                      $     62,213                 3.3       %   
                                                           39.2     %                        39.0     %                                      39.0     %                        38.6     %                           
                                                                                                                                                                                                                    
 BloomNet Wire Service                                     9,792                             8,992                  8.9       %              19,592                            17,521                 11.8      %   
                                                           52.3     %                        49.2     %                                      50.9     %                        47.6     %                           
                                                                                                                                                                                                                    
 Gourmet Food & Gift Baskets                               58,577                            55,650                 5.3       %              69,782                            66,865                 4.4       %   
                                                           41.0     %                        42.4     %                                      40.8     %                        41.9     %                           
                                                                                                                                                                                                                    
 Corporate (*)                                             162                               160                    1.0       %              502                               289                    73.7      %   
                                                           81.0     %                        84.7     %                                      127.4    %                        76.9     %                           
                                                                                                                                                                                                                    
 Total gross profit from continuing operations      $      104,485                     $     100,326                4.1       %       $      154,122                     $     146,888                4.9       %   
                                                           41.3     %                        41.8     %                                      41.2     %                        41.1     %                           
                                                                                                                                                                                                                    


                                                                                                                                                                                                                            
                                                                Three Months Ended                                                            Six Months Ended                                                              
                                                                December 30,                   January 1,                                     December 30,                   January 1,                                     
                                                                       2012                          2012                   % Change                 2012                          2012                       % Change      
                                                                                                                                                                                                                            
 Adjusted EBITDA from continuing operations:                                                                                                                                                                                
 Segment Contribution Margin (**)                                                                                                                                                                                           
 1-800-Flowers.com Consumer Floral                              $      10,286                  $     9,984                  3.0    %          $      17,172                  $     15,951                     7.7    %      
 BloomNet Wire Service                                                 6,049                         5,074                  19.2   %                 11,845                        9,667                      22.5   %      
 Gourmet Food & Gift Baskets                                           26,868                        30,166                 -10.9  %                 24,381                        28,240                     -13.7  %      
 Segment Contribution Margin Subtotal                                  43,203                        45,224                 -4.5   %                 53,398                        53,858                     -0.9   %      
 Corporate (*)                                                         (12,674  )                    (11,915  )             -6.4   %                 (24,858  )                    (23,380  )                 -6.4   %      
 EBITDA from continuing operations                                     30,529                        33,309                 -8.3   %                 28,540                        30,478                     -6.4   %      
 Add: Stock-based compensation                                         1,315                         1,211                  8.6    %                 2,304                         2,380                      -3.2   %      
 EBITDA from continuing operations, excluding stock-based              31,844                        34,520                 -7.8   %                 30,844                        32,858                     -6.1   %      
 
compensation                                                                                                                                                                                                              
 Less: Gain on sale of stores                                          -                             3,789                  -                        -                             3,789                      -             
                                                                                                                                                                                                                            
 Adjusted EBITDA from continuing operations:                    $      31,844                  $     30,731                 3.6    %          $      30,844                  $     29,069                     6.1    %      
                                                                                                                                                                                                                            


                                                                                                                                                                                            
 1-800-FLOWERS.COM, Inc. and Subsidiaries                                                                                                                                                   
 
Selected Financial Information                                                                                                                                                            
 
 (in thousands)                                                                                                                                                                           
                                                                                                                                                                                            
                                                                                            Three Months Ended                                  Six Months Ended                            
                                                                                            December 30,                    January 1,          December 30,                January 1,      
                                                                                            
2012                           
2012               
2012                       
2012           
 Reconciliation of Net Income from continuing operations to Adjusted EBITDA                                                                                                                 
 
from continuing operations (**):                                                                                                                                                          
 Net income from continuing operations                                                      $        16,011                 $       16,576      $        11,405             $       11,443  
 Add:                                                                                                                                                                                       
 Interest expense, net                                                                               559                            849                  861                        1,671   
 Depreciation and amortization                                                                       4,531                          4,929                8,989                      9,831   
 Income tax expense                                                                                  9,428                          10,955               7,285                      7,533   
 EBITDA                                                                                     $        30,529                 $       33,309      $        28,540             $       30,478  
 Add: Stock-based compensation                                                                       1,315                          1,211                2,304                      2,380   
 EBITDA , excluding stock-based compensation                                                $        31,844                 $       34,520      $        30,844             $       32,858  
 Less: Gain on sale of stores                                                                        -                              3,789                -                          3,789   
 Adjusted EBITDA from continuing operations:                                                $        31,844                 $       30,731      $        30,844             $       29,069  
                                                                                                                                                                                            


                                                                                                                                                                                    
                                                                                      Three Months Ended                                Six Months Ended                            
                                                                                      December 30,                  January 1,          December 30,                January 1,      
                                                                                      2012                          2012                2012                        2012            
 Reconciliation of Net Income and EPS from continuing operations to Adjusted                                                                                                        
 
Net Income and EPS from continuing operations:                                                                                                                                    
 Net income from continuing operations                                                $        16,011               $       16,576      $        11,405             $       11,443  
 Less: Gain on sale of stores, net of tax                                                      -                            2,281                -                          2,281   
 Adjusted Net Income from continuing operations                                       $        16,011               $       14,295      $        11,405             $       9,162   
                                                                                                                                                                                    
 Net Income per common share from continuing operations                                                                                                                             
 Basic                                                                                $        0.25                 $       0.26        $        0.18               $       0.18    
 Diluted                                                                              $        0.24                 $       0.25        $        0.17               $       0.17    
                                                                                                                                                                                    
 Adjusted Net Income per common share from continuing operations                                                                                                                    
 Basic                                                                                $        0.25                 $       0.22        $        0.18               $       0.14    
 Diluted                                                                              $        0.24                 $       0.22        $        0.17               $       0.14    
                                                                                                                                                                                    
 Weighted average shares used in the calculation of net income per common share                                                                                                     
 
from continuing operations                                                                                                                                                        
 Basic                                                                                         64,824                       64,841               64,665                     64,530  
 Diluted                                                                                       66,557                       66,050               66,695                     65,989  
                                                                                                                                                                                    


 (*)     Corporate expenses consist of the Company`s enterprise shared service cost centers, and include, among other items, Information Technology, Human Resources, Accounting   
         and Finance, Legal, Executive and Customer Service Center functions, as well as Stock-Based Compensation. In order to leverage the Company`s infrastructure, these        
         functions are operated under a centralized management platform, providing support services throughout the organization. The costs of these functions, other than those of 
         the Customer Service Center, which are allocated directly to the above segments based upon usage, are included within corporate expenses as they are not directly         
         allocable to a specific segment.                                                                                                                                          
                                                                                                                                                                                   
 (**)    Performance is measured based on segment contribution margin or segment Adjusted EBITDA, reflecting only the direct controllable revenue and operating expenses of the    
         segments. As such, management`s measure of profitability for these segments does not include the effect of corporate overhead, described above, depreciation and          
         amortization, other income (net), nor does it include one-time charges or gains. Management utilizes EBITDA, and adjusted financial information, as a performance         
         measurement tool because it considers such information a meaningful supplemental measure of its performance and believes it is frequently used by the investment community 
         in the evaluation of companies with comparable market capitalization. The Company also uses EBITDA and adjusted financial information as one of the factors used to       
         determine the total amount of bonuses available to be awarded to executive officers and other employees. The Company`s credit agreement uses EBITDA and adjusted financial 
         information to measure compliance with covenants such as interest coverage and debt incurrence. EBITDA and adjusted financial information is also used by the Company to  
         evaluate and price potential acquisition candidates. EBITDA and adjusted financial information have limitations as an analytical tool, and should not be considered in    
         isolation or as a substitute for analysis of the Company's results as reported under GAAP. Some of these limitations are: (a) EBITDA does not reflect changes in, or cash 
         requirements for, the Company's working capital needs; (b) EBITDA does not reflect the significant interest expense, or the cash requirements necessary to service        
         interest or principal payments, on the Company's debts; and (c) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized   
         may have to be replaced in the future, and EBITDA does not reflect any cash requirements for such capital expenditures. Because of these limitations, EBITDA should only  
         be used on a supplemental basis combined with GAAP results when evaluating the Company's performance.                                                                     


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1-800-FLOWERS.COM, Inc.
Investors:
Joseph D. Pititto, 516-237-6131
invest@1800flowers.com
or
Media:
Yanique Woodall, 516-237-6028
ywoodall@1800flowers.com



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