Nebraska
|
47-0366193
|
(State
or other jurisdiction of
|
(I.R.S.
Employer
|
incorporation
or organization)
|
Identification
No.)
|
Title of class
|
Name of Each Exchange on Which
Registered
|
|
Common
Stock, $.01 par value
|
New
York Stock Exchange
|
Pages
|
||
Part
I. Financial Information (unaudited)
|
||
Item
1.
|
Financial
Statements
|
3
|
Item
2.
|
Management's
Discussion and Analysis of Financial
|
|
Condition
and Results of Operations
|
16
|
|
Item
3.
|
Quantitative
and Qualitative Disclosures About Market Risk
|
24
|
Item
4.
|
Controls
and Procedures
|
24
|
Part
II. Other Information
|
||
Item
1.
|
Legal
Proceedings
|
25
|
Item
1A.
|
Risk
Factors
|
25
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
25
|
Item
3.
|
Defaults
Upon Senior Securities
|
25
|
Item
4.
|
Reserved
|
25
|
Item
5.
|
Other
Information
|
25
|
Item
6.
|
Exhibits
|
25
|
Signatures
|
26
|
May 1,
|
January 30,
|
|||||||
|
2010
|
2010
|
||||||
ASSETS | ||||||||
CURRENT
ASSETS:
|
||||||||
Cash
and cash equivalents
|
$ | 131,417 | $ | 135,340 | ||||
Short-term
investments
|
22,887 | 22,687 | ||||||
Accounts
receivable, net of allowance of $20 and $35, respectively
|
4,942 | 6,911 | ||||||
Inventory
|
84,741 | 88,187 | ||||||
Prepaid
expenses and other assets
|
19,313 | 11,684 | ||||||
Total
current assets
|
263,300 | 264,809 | ||||||
PROPERTY
AND EQUIPMENT
|
323,086 | 305,974 | ||||||
Less
accumulated depreciation and amortization
|
(164,553 | ) | (159,392 | ) | ||||
158,533 | 146,582 | |||||||
LONG-TERM
INVESTMENTS
|
81,776 | 72,770 | ||||||
OTHER
ASSETS
|
4,985 | 4,742 | ||||||
$ | 508,594 | $ | 488,903 | |||||
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
||||||||
CURRENT
LIABILITIES:
|
||||||||
Accounts
payable
|
$ | 33,307 | $ | 24,364 | ||||
Accrued
employee compensation
|
16,698 | 41,463 | ||||||
Accrued
store operating expenses
|
8,392 | 8,866 | ||||||
Gift
certificates redeemable
|
10,241 | 13,507 | ||||||
Income
taxes payable
|
17,940 | 3,830 | ||||||
Total
current liabilities
|
86,578 | 92,030 | ||||||
DEFERRED
COMPENSATION
|
7,223 | 5,957 | ||||||
DEFERRED
RENT LIABILITY
|
36,529 | 36,657 | ||||||
Total
liabilities
|
130,330 | 134,644 | ||||||
COMMITMENTS
|
||||||||
STOCKHOLDERS’
EQUITY:
|
||||||||
Common
stock, authorized 100,000,000 shares of $.01 par value; 46,726,491 and
46,381,263
|
||||||||
shares
issued and outstanding at May 1, 2010 and January 30, 2010,
respectively
|
467 | 464 | ||||||
Additional
paid-in capital
|
82,032 | 78,837 | ||||||
Retained
earnings
|
296,524 | 275,751 | ||||||
Accumulated
other comprehensive loss
|
(759 | ) | (793 | ) | ||||
Total
stockholders’ equity
|
378,264 | 354,259 | ||||||
$ | 508,594 | $ | 488,903 |
Thirteen Weeks Ended
|
||||||||
May 1,
|
May 2,
|
|||||||
2010
|
2009
|
|||||||
SALES,
Net of returns and allowances
|
$ | 214,797 | $ | 199,697 | ||||
COST
OF SALES (Including buying, distribution, and occupancy
costs)
|
121,346 | 112,994 | ||||||
Gross
profit
|
93,451 | 86,703 | ||||||
OPERATING
EXPENSES:
|
||||||||
Selling
|
39,843 | 37,597 | ||||||
General
and administrative
|
7,421 | 7,378 | ||||||
47,264 | 44,975 | |||||||
INCOME
FROM OPERATIONS
|
46,187 | 41,728 | ||||||
OTHER
INCOME, Net
|
1,833 | 910 | ||||||
INCOME
BEFORE INCOME TAXES
|
48,020 | 42,638 | ||||||
PROVISION
FOR INCOME TAXES
|
17,910 | 15,776 | ||||||
NET
INCOME
|
$ | 30,110 | $ | 26,862 | ||||
EARNINGS
PER SHARE:
|
||||||||
Basic
|
$ | 0.65 | $ | 0.59 | ||||
Diluted
|
$ | 0.64 | $ | 0.58 | ||||
Basic
weighted average shares
|
46,053 | 45,529 | ||||||
Diluted
weighted average shares
|
46,993 | 46,521 |
Accumulated
|
||||||||||||||||||||||||
Additional
|
Other
|
|||||||||||||||||||||||
Number
|
Common
|
Paid-in
|
Retained
|
Comprehensive
|
||||||||||||||||||||
of Shares
|
Stock
|
Capital
|
Earnings
|
Loss
|
Total
|
|||||||||||||||||||
FISCAL 2010
|
||||||||||||||||||||||||
BALANCE,
January 31, 2010
|
46,381,263 | $ | 464 | $ | 78,837 | $ | 275,751 | $ | (793 | ) | $ | 354,259 | ||||||||||||
Net
income
|
- | - | - | 30,110 | - | 30,110 | ||||||||||||||||||
Dividends
paid on common stock,
|
||||||||||||||||||||||||
($0.20
per share)
|
- | - | - | (9,337 | ) | - | (9,337 | ) | ||||||||||||||||
Common
stock issued on exercise
|
||||||||||||||||||||||||
of
stock options
|
101,463 | 1 | 470 | - | - | 471 | ||||||||||||||||||
Issuance
of non-vested stock, net of forfeitures
|
243,765 | 2 | (2 | ) | - | - | - | |||||||||||||||||
Amortization
of non-vested stock grants,
|
||||||||||||||||||||||||
net
of forfeitures
|
- | - | 1,500 | - | - | 1,500 | ||||||||||||||||||
Stock
option compensation expense
|
- | - | 16 | - | - | 16 | ||||||||||||||||||
Income
tax benefit related to exercise of
|
||||||||||||||||||||||||
stock
options
|
- | - | 1,211 | - | - | 1,211 | ||||||||||||||||||
Unrealized
loss on investments, net of tax
|
- | - | - | - | 34 | 34 | ||||||||||||||||||
BALANCE,
May 1, 2010
|
46,726,491 | $ | 467 | $ | 82,032 | $ | 296,524 | $ | (759 | ) | $ | 378,264 | ||||||||||||
FISCAL 2009
|
||||||||||||||||||||||||
BALANCE,
February 1, 2009
|
45,906,265 | $ | 459 | $ | 68,894 | $ | 268,789 | $ | (920 | ) | $ | 337,222 | ||||||||||||
Net
income
|
- | - | - | 26,862 | - | 26,862 | ||||||||||||||||||
Dividends
paid on common stock,
|
||||||||||||||||||||||||
($0.20
per share)
|
- | - | - | (9,222 | ) | - | (9,222 | ) | ||||||||||||||||
Common
stock issued on exercise
|
||||||||||||||||||||||||
of
stock options
|
2,337 | - | 18 | - | - | 18 | ||||||||||||||||||
Issuance
of non-vested stock, net of forfeitures
|
200,053 | 2 | (2 | ) | - | - | - | |||||||||||||||||
Amortization
of non-vested stock grants,
|
||||||||||||||||||||||||
net
of forfeitures
|
- | - | 1,225 | - | - | 1,225 | ||||||||||||||||||
Stock
option compensation expense
|
- | - | 40 | - | - | 40 | ||||||||||||||||||
Unrealized
loss on investments, net of tax
|
- | - | - | - | (18 | ) | (18 | ) | ||||||||||||||||
BALANCE,
May 2, 2009
|
46,108,655 | $ | 461 | $ | 70,175 | $ | 286,429 | $ | (938 | ) | $ | 356,127 |
Thirteen Weeks Ended
|
||||||||
May 1,
|
May 2,
|
|||||||
2010
|
2009
|
|||||||
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
||||||||
Net
income
|
$ | 30,110 | $ | 26,862 | ||||
Adjustments
to reconcile net income to net cash flows
|
||||||||
from
operating activities:
|
||||||||
Depreciation
and amortization
|
6,490 | 5,481 | ||||||
Amortization
of non-vested stock grants, net of forfeitures
|
1,500 | 1,225 | ||||||
Stock
option compensation expense
|
16 | 40 | ||||||
Deferred
income taxes
|
(562 | ) | (472 | ) | ||||
Other
|
11 | 23 | ||||||
Changes
in operating assets and liabilities:
|
||||||||
Accounts
receivable
|
759 | (52 | ) | |||||
Inventory
|
3,446 | 1,171 | ||||||
Prepaid
expenses and other assets
|
(7,352 | ) | (505 | ) | ||||
Accounts
payable
|
11,177 | 15,800 | ||||||
Accrued
employee compensation
|
(24,765 | ) | (23,784 | ) | ||||
Accrued
store operating expenses
|
(474 | ) | 157 | |||||
Gift
certificates redeemable
|
(3,266 | ) | (2,538 | ) | ||||
Income
taxes payable
|
15,384 | 10,147 | ||||||
Long-term
liabilities and deferred compensation
|
1,138 | 1,966 | ||||||
Net
cash flows from operating activities
|
33,612 | 35,521 | ||||||
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
||||||||
Purchase
of property and equipment
|
(20,700 | ) | (14,865 | ) | ||||
Proceeds
from sale of property and equipment
|
14 | 8 | ||||||
Purchases
of investments
|
(15,240 | ) | (9,660 | ) | ||||
Proceeds
from sales/maturities of investments
|
6,088 | 6,628 | ||||||
Net
cash flows from investing activities
|
(29,838 | ) | (17,889 | ) | ||||
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
||||||||
Proceeds
from the exercise of stock options
|
471 | 18 | ||||||
Excess
tax benefit from stock option exercises
|
1,169 | 16 | ||||||
Payment
of dividends
|
(9,337 | ) | (9,222 | ) | ||||
Net
cash flows from financing activities
|
(7,697 | ) | (9,188 | ) | ||||
NET
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
(3,923 | ) | 8,444 | |||||
CASH
AND CASH EQUIVALENTS, Beginning of period
|
135,340 | 162,463 | ||||||
CASH
AND CASH EQUIVALENTS, End of period
|
$ | 131,417 | $ | 170,907 |
1.
|
Management
Representation
|
2.
|
Description of the
Business
|
Thirteen Weeks Ended
|
||||||||
Merchandise Group
|
May 1, 2010
|
May 2, 2009
|
||||||
Denims
|
45.4 | % | 41.7 | % | ||||
Tops
(including sweaters)
|
32.9 | 36.5 | ||||||
Sportswear/Fashions
|
8.4 | 8.4 | ||||||
Accessories
|
6.5 | 7.2 | ||||||
Footwear
|
5.3 | 4.8 | ||||||
Outerwear
|
0.9 | 0.8 | ||||||
Casual
bottoms
|
0.5 | 0.5 | ||||||
Other
|
0.1 | 0.1 | ||||||
100.0 | % | 100.0 | % |
3.
|
Net Earnings Per
Share
|
Thirteen Weeks Ended
|
Thirteen Weeks Ended
|
|||||||||||||||||||||||
May 1, 2010
|
May 2, 2009
|
|||||||||||||||||||||||
Weighted
|
Per
|
Weighted
|
Per
|
|||||||||||||||||||||
Average
|
Share
|
Average
|
Share
|
|||||||||||||||||||||
Income
|
Shares
|
Amount
|
Income
|
Shares
|
Amount
|
|||||||||||||||||||
Basic
EPS
|
$ | 30,110 | 46,053 | $ | 0.65 | $ | 26,862 | 45,529 | $ | 0.59 | ||||||||||||||
Effect
of Dilutive Securities:
|
||||||||||||||||||||||||
Stock
options and
|
||||||||||||||||||||||||
non-vested
shares
|
- | 940 | (0.01 | ) | - | 992 | (0.01 | ) | ||||||||||||||||
Diluted
EPS
|
$ | 30,110 | 46,993 | $ | 0.64 | $ | 26,862 | 46,521 | $ | 0.58 |
4.
|
Investments
|
Amortized
|
Gross
|
Gross
|
Other-than-
|
Estimated
|
||||||||||||||||
Cost or
|
Unrealized
|
Unrealized
|
Temporary
|
Fair
|
||||||||||||||||
Par Value
|
Gains
|
Losses
|
Impairment
|
Value
|
||||||||||||||||
Available-for-Sale
Securities:
|
||||||||||||||||||||
Auction-rate
securities
|
$ | 23,800 | $ | - | $ | (1,205 | ) | $ | (725 | ) | $ | 21,870 | ||||||||
Municipal
bonds
|
8,483 | 13 | (13 | ) | - | 8,483 | ||||||||||||||
Preferred
stock
|
2,000 | - | - | (1,974 | ) | 26 | ||||||||||||||
$ | 34,283 | $ | 13 | $ | (1,218 | ) | $ | (2,699 | ) | $ | 30,379 | |||||||||
Held-to-Maturity
Securities:
|
||||||||||||||||||||
State
and municipal bonds
|
$ | 56,416 | $ | 506 | $ | (25 | ) | $ | - | $ | 56,897 | |||||||||
Fixed
maturities
|
8,870 | 80 | - | - | 8,950 | |||||||||||||||
Certificates
of deposit
|
1,275 | 20 | - | - | 1,295 | |||||||||||||||
U.S.
treasuries
|
500 | - | - | - | 500 | |||||||||||||||
$ | 67,061 | $ | 606 | $ | (25 | ) | $ | - | $ | 67,642 | ||||||||||
Trading
Securities:
|
||||||||||||||||||||
Mutual
funds
|
$ | 7,217 | $ | 6 | $ | - | $ | - | $ | 7,223 |
Amortized
|
Gross
|
Gross
|
Other-than-
|
Estimated
|
||||||||||||||||
Cost or
|
Unrealized
|
Unrealized
|
Temporary
|
Fair
|
||||||||||||||||
Par Value
|
Gains
|
Losses
|
Impairment
|
Value
|
||||||||||||||||
Available-for-Sale
Securities:
|
||||||||||||||||||||
Auction-rate
securities
|
$ | 24,775 | $ | - | $ | (1,258 | ) | $ | (725 | ) | $ | 22,792 | ||||||||
Municipal
bonds
|
8,116 | 14 | (14 | ) | - | 8,116 | ||||||||||||||
Preferred
stock
|
2,000 | - | - | (1,974 | ) | 26 | ||||||||||||||
$ | 34,891 | $ | 14 | $ | (1,272 | ) | $ | (2,699 | ) | $ | 30,934 | |||||||||
Held-to-Maturity
Securities:
|
||||||||||||||||||||
State
and municipal bonds
|
$ | 47,036 | $ | 535 | $ | (10 | ) | $ | - | $ | 47,561 | |||||||||
Fixed
maturities
|
8,890 | 92 | - | - | 8,982 | |||||||||||||||
Certificates
of deposit
|
1,640 | 27 | - | - | 1,667 | |||||||||||||||
U.S.
treasuries
|
1,000 | 1 | - | - | 1,001 | |||||||||||||||
$ | 58,566 | $ | 655 | $ | (10 | ) | $ | - | $ | 59,211 | ||||||||||
Trading
Securities:
|
||||||||||||||||||||
Mutual
funds
|
$ | 6,200 | $ | - | $ | (243 | ) | $ | - | $ | 5,957 |
Nature
|
Underlying Collateral
|
Par Value
|
||||
Municipal
revenue bonds
|
92%
insured by AAA/AA/A-rated bond insurers at May 1, 2010
|
$ | 11,650 | |||
Municipal
bond funds
|
Fixed
income instruments within issuers' money market funds
|
8,400 | ||||
Student
loan bonds
|
Student
loans guaranteed by state entities
|
3,750 | ||||
Preferred
stock
|
Underlying
investments of closed-end funds
|
2,000 | ||||
Total
par value
|
$ | 25,800 |
Amortized
|
Fair
|
|||||||
Cost
|
Value
|
|||||||
Available-for-sale
securities
|
||||||||
Less
than 1 year
|
$ | 3,353 | $ | 3,353 | ||||
1 -
5 years
|
1,179 | 1,179 | ||||||
5 -
10 years
|
1,457 | 1,457 | ||||||
Greater
than 10 years
|
2,494 | 2,494 | ||||||
$ | 8,483 | $ | 8,483 | |||||
Held-to-maturity
securities
|
||||||||
Less
than 1 year
|
$ | 18,234 | $ | 18,322 | ||||
1 -
5 years
|
46,865 | 47,286 | ||||||
5 -
10 years
|
1,116 | 1,171 | ||||||
Greater
than 10 years
|
846 | 863 | ||||||
$ | 67,061 | $ | 67,642 |
5.
|
Fair Value
Measurements
|
|
·
|
Level
1 – Quoted market prices in active markets for identical assets or
liabilities. Short-term and long-term investments with active markets or
known redemption values are reported at fair value utilizing Level 1
inputs.
|
|
·
|
Level
2 – Observable market-based inputs (either directly or indirectly) such as
quoted prices for similar assets or liabilities, quoted prices in markets
that are not active, or other inputs that are observable or inputs that
are corroborated by market data.
|
|
·
|
Level
3 – Unobservable inputs that are not corroborated by market data and are
projections, estimates, or interpretations that are supported by little or
no market activity and are significant to the fair value of the assets.
The Company has concluded that certain of its ARS represent Level 3
valuation and should be valued using a discounted cash flow analysis. The
assumptions used in preparing the discounted cash flow model include
estimates for interest rates, timing and amount of cash flows, and
expected holding periods of the
ARS.
|
|
·
|
Pricing
was provided by the custodian of
ARS;
|
|
·
|
Pricing
was provided by a third-party broker for
ARS;
|
|
·
|
Sales
of similar securities;
|
|
·
|
Quoted
prices for similar securities in active
markets;
|
|
·
|
Quoted
prices for publicly traded preferred
securities;
|
|
·
|
Quoted
prices for similar assets in markets that are not active - including
markets where there are few transactions for the asset, the prices are not
current, or price quotations vary substantially either over time or among
market makers, or in which little information is released
publicly;
|
|
·
|
Pricing
was provided by a third-party valuation consultant (using Level 3
inputs).
|
Fair Value Measurements at Reporting Date Using
|
||||||||||||||||
Quoted Prices in
|
||||||||||||||||
Active Markets
|
Significant
|
Significant
|
||||||||||||||
for Identical
|
Observable
|
Unobservable
|
||||||||||||||
Assets
|
Inputs
|
Inputs
|
||||||||||||||
May 1, 2010
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
Total
|
||||||||||||
Available-for-Sale
Securities
|
||||||||||||||||
Auction-rate
securities
|
$ | 1,267 | $ | 11,994 | $ | 8,609 | $ | 21,870 | ||||||||
Municipal
bonds
|
8,483 | - | - | 8,483 | ||||||||||||
Preferred
stock
|
26 | - | - | 26 | ||||||||||||
Trading
Securities (including mutual funds)
|
7,223 | - | - | 7,223 | ||||||||||||
Totals
|
$ | 16,999 | $ | 11,994 | $ | 8,609 | $ | 37,602 |
Fair Value Measurements at Reporting Date Using
|
||||||||||||||||
Quoted Prices in
|
||||||||||||||||
Active Markets
|
Significant
|
Significant
|
||||||||||||||
for Identical
|
Observable
|
Unobservable
|
||||||||||||||
Assets
|
Inputs
|
Inputs
|
||||||||||||||
January 30, 2010
|
(Level 1)
|
(Level 2)
|
(Level 3)
|
Total
|
||||||||||||
Available-for-Sale
Securities
|
||||||||||||||||
Auction-rate
securities
|
$ | 1,261 | $ | 12,894 | $ | 8,637 | $ | 22,792 | ||||||||
Municipal
bonds
|
8,116 | - | - | 8,116 | ||||||||||||
Preferred
stock
|
26 | - | - | 26 | ||||||||||||
Trading
Securities (including mutual funds)
|
5,957 | - | - | 5,957 | ||||||||||||
Totals
|
$ | 15,360 | $ | 12,894 | $ | 8,637 | $ | 36,891 |
Thirteen Weeks Ended May 1,
2010
|
||||||||||||
Level 1
|
Level 2
|
Level 3
|
||||||||||
Balance,
beginning of year
|
$ | 15,360 | $ | 12,894 | $ | 8,637 | ||||||
Total
gains or losses (realized and unrealized):
|
||||||||||||
Included
in net income
|
251 | - | - | |||||||||
Included
in other comprehensive income
|
6 | 28 | - | |||||||||
Purchases,
sales, issuances, and settlements (net)
|
1,382 | (928 | ) | (28 | ) | |||||||
Transfers
in and/or out
|
- | - | - | |||||||||
Balance,
end of quarter
|
$ | 16,999 | $ | 11,994 | $ | 8,609 |
Thirteen Weeks Ended May 2,
2009
|
||||||||||||
Level 1
|
Level 2
|
Level 3
|
||||||||||
Balance,
beginning of year
|
$ | 6,240 | $ | 21,468 | $ | 7,260 | ||||||
Total
gains or losses (realized and unrealized):
|
||||||||||||
Included
in net income
|
- | - | - | |||||||||
Included
in other comprehensive income
|
- | (18 | ) | - | ||||||||
Purchases,
sales, issuances, and settlements (net)
|
1,351 | (1,829 | ) | - | ||||||||
Transfers
in and/or out
|
- | - | - | |||||||||
Balance,
end of quarter
|
$ | 7,591 | $ | 19,621 | $ | 7,260 |
6.
|
Comprehensive
Income
|
Thirteen Weeks Ended
|
||||||||
May 1, 2010
|
May 2, 2009
|
|||||||
Net
income
|
$ | 30,110 | $ | 26,862 | ||||
Changes
in net unrealized losses on investments
|
||||||||
in
auction-rate-securities, net of taxes of $(20) and $11
|
34 | (18 | ) | |||||
Comprehensive
income
|
$ | 30,144 | $ | 26,844 |
7.
|
Supplemental Cash Flow
Information
|
8.
|
Stock-Based
Compensation
|
Thirteen Weeks Ended
|
||||||||
May 1, 2010
|
May 2, 2009
|
|||||||
Stock-based
compensation expense, before tax:
|
||||||||
Stock
options
|
$ | 16 | $ | 40 | ||||
Non-vested
shares of common stock
|
1,500 | 1,225 | ||||||
Total
stock-based compensation expense, before tax
|
$ | 1,516 | $ | 1,265 | ||||
Total
stock-based compensation expense, after tax
|
$ | 955 | $ | 797 |
Weighted
|
|||||||||||
Weighted
|
Average
|
||||||||||
Average
|
Remaining
|
Aggregate
|
|||||||||
Exercise
|
Contractual
|
Intrinsic
|
|||||||||
Shares
|
Price
|
Life
|
Value
|
||||||||
Outstanding
- beginning of year
|
1,352,111 | $ | 5.02 | ||||||||
Granted
|
- | - | |||||||||
Expired/forfeited
|
- | - | |||||||||
Exercised
|
(101,463 | ) | 4.65 | ||||||||
Outstanding
- end of quarter
|
1,250,648 | $ | 5.05 |
3.10
|
years
|
$ 38,934
|
|||||
Exercisable
- end of quarter
|
1,243,877 | $ | 4.94 |
3.07
|
years
|
$ 38,853
|
Weighted Average
|
||||||||
Grant Date
|
||||||||
Shares
|
Fair Value
|
|||||||
Non-Vested
- beginning of year
|
405,345 | $ | 23.29 | |||||
Granted
|
243,900 | 28.53 | ||||||
Forfeited
|
(135 | ) | 26.20 | |||||
Vested
|
(51,516 | ) | 21.75 | |||||
Non-Vested
- end of quarter
|
597,594 | $ | 25.56 |
9.
|
Recently Issued
Accounting Pronouncements
|
Percentage of Net Sales
|
||||||||||||
Thirteen Weeks Ended
|
Percentage
|
|||||||||||
May 1, 2010
|
May 2, 2009
|
Increase/(Decrease)
|
||||||||||
Net
sales
|
100.0 | % | 100.0 | % | 7.6 | % | ||||||
Cost
of sales (including buying,
|
||||||||||||
distribution,
and occupancy costs)
|
56.5 | % | 56.6 | % | 7.4 | % | ||||||
Gross
profit
|
43.5 | % | 43.4 | % | 7.8 | % | ||||||
Selling
expenses
|
18.5 | % | 18.8 | % | 6.0 | % | ||||||
General
and administrative expenses
|
3.5 | % | 3.7 | % | 0.6 | % | ||||||
Income
from operations
|
21.5 | % | 20.9 | % | 10.7 | % | ||||||
Other
income, net
|
0.8 | % | 0.5 | % | 101.5 | % | ||||||
Income
before income taxes
|
22.3 | % | 21.4 | % | 12.6 | % | ||||||
Provision
for income taxes
|
8.3 | % | 7.9 | % | 13.5 | % | ||||||
Net
income
|
14.0 | % | 13.5 | % | 12.1 | % |
1.
|
Revenue
Recognition.
Retail store sales are recorded upon the purchase of merchandise by
customers. Online sales are recorded when merchandise is delivered to the
customer, with the time of delivery being based on estimated shipping time
from the Company’s distribution center to the customer. Shipping fees
charged to customers are included in revenue and shipping costs are
included in selling expenses. The Company accounts for layaway sales in
accordance with FASB ASC 605, Revenue Recognition,
recognizing revenue from sales made under its layaway program upon
delivery of the merchandise to the customer. Revenue is not recorded when
gift cards and gift certificates are sold, but rather when a card or
certificate is redeemed for merchandise. A current liability for
unredeemed gift cards and certificates is recorded at the time the card or
certificate is purchased. The amounts of the gift certificate and gift
card liabilities are determined using the outstanding balances from the
prior three and four years of issuance, respectively. The liability
recorded for unredeemed gift certificates and gift cards was $10.2 million
and $13.5 million as of May 1, 2010 and January 30, 2010, respectively.
The Company records breakage as other income when the probability of
redemption, which is based on historical redemption patterns, is
remote.
|
2.
|
Inventory.
Inventory is valued at the lower of cost or market. Cost is determined
using an average cost method that approximates the first-in, first-out
(FIFO) method. Management makes adjustments to inventory and cost of goods
sold, based upon estimates, to reserve for merchandise obsolescence and
markdowns that could affect market value, based on assumptions using
calculations applied to current inventory levels within each of four
different markdown levels. Management also reviews the levels of inventory
in each markdown group and the overall aging of the inventory versus the
estimated future demand for such product and the current market
conditions. Such judgments could vary significantly from actual results,
either favorably or unfavorably, due to fluctuations in future economic
conditions, industry trends, consumer demand, and the competitive retail
environment. Such changes in market conditions could negatively impact the
sale of markdown inventory, causing further markdowns or inventory
obsolescence, resulting in increased cost of goods sold from write-offs
and reducing the Company’s net earnings. The liability recorded as a
reserve for markdowns and/or obsolescence was $6.0 million and $5.8
million as of May 1, 2010 and January 30, 2010, respectively. The Company
is not aware of any events, conditions, or changes in demand or price that
would indicate that its inventory valuation may not be materially accurate
at this time.
|
3.
|
Income Taxes.
The Company records a deferred tax asset and liability for expected future
tax consequences resulting from temporary differences between financial
reporting and tax bases of assets and liabilities. The Company considers
future taxable income and ongoing tax planning in assessing the value of
its deferred tax assets. If the Company determines that it is more than
likely that these assets will not be realized, the Company would reduce
the value of these assets to their expected realizable value, thereby
decreasing net income. Estimating the value of these assets is based upon
the Company’s judgment. If the Company subsequently determined that the
deferred tax assets, which had been written down, would be realized in the
future, such value would be increased. Adjustment would be made to
increase net income in the period such determination was
made.
|
4.
|
Operating
Leases. The Company leases retail stores under operating leases.
Most lease agreements contain tenant improvement allowances, rent
holidays, rent escalation clauses, and/or contingent rent provisions. For
purposes of recognizing lease incentives and minimum rental expenses on a
straight-line basis over the terms of the leases, the Company uses the
date of initial possession to begin amortization, which is generally when
the Company enters the space and begins to make improvements in
preparation of intended use. For tenant improvement allowances and rent
holidays, the Company records a deferred rent liability on the balance
sheets and amortizes the deferred rent over the terms of the leases as
reductions to rent expense on the statements of
income.
|
5.
|
Investments.
The Company accounts for investments in accordance with FASB ASC 320,
Investments-Debt and
Equity Securities. Investments classified as short-term investments
include securities with a maturity of greater than three months and less
than one year, and a portion of the Company’s investments in auction-rate
securities (“ARS”), which are available-for-sale securities.
Available-for-sale securities are reported at fair value, with unrealized
gains and losses excluded from earnings and reported as a separate
component of stockholders’ equity (net of the effect of income taxes),
using the specific identification method, until they are
sold.
|
|
·
|
Pricing
was provided by the custodian of
ARS;
|
|
·
|
Pricing
was provided by a third-party broker for
ARS;
|
|
·
|
Sales
of similar securities;
|
|
·
|
Quoted
prices for similar securities in active
markets;
|
|
·
|
Quoted
prices for publicly traded preferred
securities;
|
|
·
|
Quoted
prices for similar assets in markets that are not active - including
markets where there are few transactions for the asset, the prices are not
current, or price quotations vary substantially either over time or among
market makers, or in which little information is released
publicly;
|
|
·
|
Pricing
was provided by a third-party valuation consultant (using Level 3
inputs).
|
Payments Due by Period
|
||||||||||||||||||||
Contractual obligations (dollar amounts in
thousands):
|
Total
|
Less than 1
year
|
1-3 years
|
4-5 years
|
After 5
years
|
|||||||||||||||
Long
term debt and purchase obligations
|
$ | 10,642 | $ | 10,382 | $ | 260 | $ | - | $ | - | ||||||||||
Deferred
compensation
|
7,223 | - | - | - | 7,223 | |||||||||||||||
Operating
leases
|
316,834 | 49,368 | 85,467 | 69,626 | 112,373 | |||||||||||||||
Total
contractual obligations
|
$ | 334,699 | $ | 59,750 | $ | 85,727 | $ | 69,626 | $ | 119,596 |
Amount of Commitment Expiration Per Period
|
||||||||||||||||||||
Other commercial commitments (dollar
amounts in thousands):
|
Total
Amounts
Committed
|
Less than 1
year
|
1-3 years
|
4-5 years
|
After 5
years
|
|||||||||||||||
Lines
of credit
|
$ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||
Total
commercial commitments
|
$ | - | $ | - | $ | - | $ | - | $ | - |
Total
Number
of Shares
Purchased
|
Average
Price Paid
Per Share
|
Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
|
Maximum Number of Shares
that May Yet Be Purchased
Under Publicly
Announced Plans
|
|||||||||||||
Jan.
31, 2010 to Feb. 27, 2010
|
- | - | - | 799,300 | ||||||||||||
Feb.
28, 2010 to April 3, 2010
|
- | - | - | 799,300 | ||||||||||||
April
4, 2010 to May 1, 2010
|
- | - | - | 799,300 | ||||||||||||
- | - | - |
The
Board of Directors authorized a 1,000,000 share repurchase plan on
November 20, 2008. The Company has 799,300 shares remaining to complete
this authorization.
|
|
(a)
|
Exhibits
31.1 and 31.2 certifications, as well as Exhibits 32.1 and 32.2
Certifications Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of
2002.
|
THE
BUCKLE, INC.
|
|
Dated:
June 10
, 2010
|
/s/ DENNIS H.
NELSON .
|
DENNIS
H. NELSON, President and CEO
|
|
(principal
executive officer)
|
|
Dated:
June 10
, 2010
|
/s/ KAREN B.
RHOADS .
|
KAREN
B. RHOADS, Vice President
|
|
of
Finance and CFO
|
|
(principal
accounting
officer)
|