EMERYVILLE, Calif., Aug. 3 /PRNewswire-FirstCall/ -- Peet's Coffee
& Tea, Inc. (NASDAQ:PEET) today announced its second quarter
results for the period ended July 2, 2006, which included 13 weeks.
In this release, the company: -- Reports sales growth for the
quarter of 19.1 percent; -- Reports earnings per share of $0.12 and
net income of $1.8 million, which includes stock-based compensation
expense recognized under SFAS 123R, Share-Based Payment, of $0.05
per share; -- Reports that a total of seven new stores opened in
the quarter and confirms that the company is on track to open 23 to
28 new stores this year; and -- Confirms 2006 guidance of 20 to 23
percent sales growth and $0.62 to $0.65 earnings per share, which
includes stock-based compensation expense of $0.19 to $0.21. For
the quarter ended July 2, 2006, net revenue increased 19.1 percent
to $49.7 million from $41.7 million for the corresponding period of
fiscal 2005. Reported earnings for the quarter, including
accounting for stock options, were $1.8 million or $0.12 per share,
compared to $2.6 million or $0.18 per share last year. The impact
of adopting SFAS 123R lowered net income by $0.7 million, or $.05
per share for the quarter ended July 2, 2006. "We are pleased with
our progress during the quarter and remain on track to deliver our
full year earnings and sales guidance," said Patrick O'Dea,
president and CEO of Peet's Coffee & Tea, Inc. "Of equal
importance, construction of our new roasting facility is
progressing on schedule toward an April 2007 opening and will
enable us to realize our western U.S. growth strategy and plans
well into the future." Financial and Operating Summary Retail
revenue increased 17.5 percent to $33.6 million for the quarter
ended July 2, 2006, from $28.6 million for the corresponding period
of fiscal 2005. The increase was primarily attributable to new
retail stores opened in the last 12 months and secondarily to
growth in existing stores. The company opened seven new locations
during the quarter. Specialty revenue increased 22.5 percent to
$16.1 million, compared to $13.1 million last year. Within
specialty sales, the grocery business continues to grow the most
rapidly, up 36.4 percent over last year, with existing grocery
customers accounting for over half of the increase. The home
delivery business also grew 15.4 percent, and the foodservice and
office business grew 8.0 percent during the quarter compared to the
same period last year. Cost of sales and related occupancy costs
increased to 46.5 percent of total net revenue compared to 45.1
percent for the corresponding quarter last year. The increase over
last year is due to higher green coffee costs, an increased number
of new stores, which have higher occupancy expenses on a lower
sales base, and the expensing of stock options, partially offset by
a grocery pricing increase in October 2005. Operating expenses as a
percentage of net revenue increased to 36.1 percent compared to
34.4 percent for the corresponding quarter last year. The increase
was driven by the expensing of stock options in 2006 (0.8
percentage points), higher retail operating expenses due to new
stores opened in the last 12 months, and higher operating costs to
support existing stores. Depreciation and amortization expenses
increased to $2.1 million, compared to $1.8 million for the
corresponding quarter last year. The increase was primarily due to
the opening of 21 new retail stores in the last 12 months. As a
percentage of total net revenue, depreciation and amortization
expenses decreased to 4.2 percent from 4.4 percent last year.
General and administrative expenses increased to $3.4 million
compared to $2.1 million for the same period last year primarily
due to costs associated to support acceleration of the growth of
the business and $0.7 million of stock option expense in 2006. The
company ended the quarter with cash and cash equivalents plus
investments of $58.5 million. Fiscal 2006 Targets Looking ahead,
Peet's reaffirmed fiscal 2006 targets: -- In the third quarter of
2006, the company is forecasting sales to grow approximately 19
percent with earnings per share between $0.10 and $0.11. This
includes a $0.05 per share impact of expensing stock options. --
For the full year, Peet's is targeting total net revenue to grow
approximately 20 to 23 percent and earnings per share of $0.62 to
$0.65, which includes a $0.19 to $0.21 per share impact of
expensing stock options. Peet's Coffee & Tea, Inc. Q2 2006
Conference Call Peet's Coffee & Tea, Inc. Q2 2006 Conference
Call The company will report its second quarter 2006 earnings
results via conference call on Thursday, August 3, 2006. The
teleconference call will begin at 2 p.m. PDT/5 p.m. EDT. The
teleconference can be accessed by calling 1-866-550-6338, using
access code 9485537. The call will be simultaneously Webcast on
Peet's Web site at http://investor.peets.com/Medialist.cfm . A
replay of the teleconference will be available two hours after the
end of the call through midnight EDT on August 9, 2006, at
1-888-203-1112 or 719-457-0820, using access code 9485537. It will
also be archived at http://investor.peets.com/Medialist.cfm through
August 3, 2007. ABOUT PEET'S COFFEE & TEA, INC. Founded in
Berkeley, Calif. in 1966, Peet's Coffee & Tea, Inc. is a
specialty coffee roaster and marketer of fresh, deep-roasted whole
bean coffee for home and office enjoyment. Peet's fresh-roasted
coffee, hand-selected tea and related items are sold in several
distribution channels including grocery, home delivery, office and
food service accounts and company-owned stores throughout the
United States. For information about Peet's Coffee & Tea, Inc.,
visit http://www.peets.com/ or call 1-800-999-2132. Peet's Coffee
& Tea, Inc. shares are traded under the symbol PEET. This press
release contains statements that are not based on historical fact
and are "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. These forward
looking statements include statements relating to 2006 third
quarter and full year revenue, earnings per share and stock-based
compensation expense estimates. Forward- looking statements are
based on management's beliefs as well as assumptions made by and
information currently available to management, including financial
and operational information, the Company's stock price volatility,
and current competitive conditions. As a result, these statements
are subject to various risks and uncertainties. The Company's
actual results could differ materially from those set forth in
forward-looking statements depending on a variety of factors
including, but not limited to, the Company's ability to implement
its business strategy, attract and retain customers, and obtain and
expand its market presence in new geographic regions; the impact of
the Company's stock price volatility on the valuation of
stock-based compensation under SFAS 123R; the availability and cost
of high quality Arabica coffee beans; consumers' tastes and
preferences; and competition in its market as well as other risk
factors as described more fully in the Company's filings with the
Securities and Exchange Commission, including its Annual Report on
Form 10-K for the year ended January 1, 2006. These factors may not
be exhaustive. The Company operates in a continually changing
business environment, and new risks emerge from time to time. Any
forward-looking statements speak only as of the date of this press
release. Stock-based Compensation Expense Effective January 2,
2006, the beginning of Peet's first fiscal quarter of 2006, the
Company adopted the fair value recognition provisions of Financial
Accounting Standards Board Statement No. 123R, Share-Based Payment
("SFAS 123R"). SFAS 123R requires all stock-based compensation,
including grants of employee stock options, to be recognized in the
statement of earnings based on their fair values. The Company is
providing the table below because management believes it provides
useful information to investors regarding the Company's results of
operations by separately identifying the stock-based compensation
expense and providing reported amounts on a basis comparable to
that used in prior periods. The application of SFAS 123R had the
following effect on reported amounts for the 13 weeks ended July 2,
2006 relative to the amounts that would have been reported using
the intrinsic value method under the Company's previous accounting
(in thousands, except earnings per share): Using Previous
Stock-based Accounting Compensation (non-GAAP) (non-GAAP) As
Reported Cost of sales and related occupancy expenses $22,923 $160
$23,083 Operating expenses 17,543 370 17,913 General and
administrative expenses 2,742 657 3,399 Operating income 3,288
(1,187) 2,101 Income before income taxes 3,990 (1,187) 2,803 Income
tax provision 1,504 (464) 1,040 Net income 2,486 (723) 1,763 Net
income per diluted share $0.17 $(0.05) $0.12 Diluted shares
outstanding 14,399 150 14,549 The amounts shown in the column above
entitled "Using Previous Accounting" are considered "non-GAAP
financial measures" under applicable SEC rules because they exclude
the stock-based payment expense that is included in the directly
comparable measures calculated in accordance with generally
accepted accounting principles in the United States ("GAAP"), which
are shown in the column entitled "As Reported." These non-GAAP
financial measures are not a substitute for the reported GAAP
measures. PEET'S COFFEE & TEA, INC. CONSOLIDATED STATEMENTS OF
INCOME (Unaudited, in thousands, except per share amounts) Thirteen
weeks Twenty-six weeks ended ended July 2, July 3, July 2, July 3,
2006 2005 2006 2005 Retail stores $33,581 $28,575 $66,981 $55,858
Specialty sales 16,108 13,148 32,415 25,853 Net revenue 49,689
41,723 99,396 81,711 Cost of sales and related occupancy expenses
23,083 18,826 45,576 36,897 Operating expenses 17,913 14,362 35,326
27,863 Marketing and advertising expenses 1,097 741 2,187 1,572
Depreciation and amortization expenses 2,096 1,821 4,079 3,501
General and administrative expenses 3,399 2,116 7,036 4,310 Total
costs and expenses from operations 47,588 37,866 94,204 74,143
Income from operations 2,101 3,857 5,192 7,568 Interest income 702
427 1,379 755 Income before income taxes 2,803 4,284 6,571 8,323
Income tax provision 1,040 1,681 2,482 3,292 Net income $1,763
$2,603 $4,089 $5,031 Net income per share: Basic $0.13 $0.19 $0.29
$0.37 Diluted $0.12 $0.18 $0.28 $0.35 Shares used in calculation of
net income per share: Basic 13,840 13,748 13,866 13,656 Diluted
14,549 14,424 14,579 14,297 PEET'S COFFEE & TEA, INC.
CONSOLIDATED BALANCE SHEETS (Unaudited, in thousands, except share
amounts) July 2, January 1, 2006 2006 ASSETS Current assets Cash
and cash equivalents $13,798 $20,623 Short-term marketable
securities 34,853 32,453 Accounts receivable, net 5,205 5,152
Inventories 19,724 16,148 Deferred income taxes 1,514 1,514 Prepaid
expenses and other 5,282 3,372 Total current assets 80,376 79,262
Long-term marketable securities 9,863 16,890 Property and
equipment, net 52,779 46,313 Intangible and other assets, net 7,537
5,434 Total assets $150,555 $147,899 LIABILITIES AND SHAREHOLDERS'
EQUITY Current liabilities Accounts payable and other accrued
liabilities $7,903 $8,553 Accrued compensation and benefits 5,793
5,563 Deferred revenue 2,855 3,415 Total current liabilities 16,551
17,531 Deferred income taxes 1,759 1,759 Deferred lease credits and
other long-term liabilities 2,814 2,537 Total liabilities 21,124
21,827 Shareholders' equity Common stock, no par value; authorized
50,000,000 shares; issued and outstanding: 13,834,000 and
13,902,000 shares 98,555 99,273 Accumulated other comprehensive
loss, net of tax (88) (76) Retained earnings 30,964 26,875 Total
shareholders' equity 129,431 126,072 Total liabilities and
shareholders' equity $150,555 $147,899 DATASOURCE: Peet's Coffee
& Tea, Inc. CONTACT: Media Contact, Jennifer Strasburg of Weber
Shandwick, +1-415-248-3436, or ; or Investor Contact, Susie
Phillips of Peet's Coffee & Tea, Inc., +1-510-594-2196, or Web
site: http://www.peets.com/
Copyright
Peets Coffee & Tea, Inc. (MM) (NASDAQ:PEET)
Historical Stock Chart
From Jun 2024 to Jul 2024
Peets Coffee & Tea, Inc. (MM) (NASDAQ:PEET)
Historical Stock Chart
From Jul 2023 to Jul 2024