The Children’s Place Retail Stores, Inc. (
PLCE)
Q3 2009 Earnings Call Transcript
November 19, 2009 10:00 a.m. ET
Executives
Jane Singer - Vice President, Investor Relations
Charles K. Crovitz - Interim Chief Executive Officer
Susan J. Riley - Executive Vice President, Finance and Administration and Chief Financial Officer
Dina Sweeney - Senior Vice President, Merchandising
Analysts
Richard Jaffe - Stifel Nicolaus & Company, Inc.
John Morris - BMO Capital Market
Kimberly Greenberger - Citigroup
Linda Tsai - MKM Partners
Rick Patel - Bank of America-Merrill Lynch
Janet Kloppenberg - JJK Research
Brian Tunick - JP Morgan
Margaret Whitfield - Sterne Agee
Thomas Filandro - SIG-Susquehanna Financial Group
Dorothy Lakner - Caris & Company
Lee Giordano - Imperial Capital
Jodi Wang - Buckingham Research
Dana Telsey - Telsey Advisory Group
Presentation
Operator
Good day. And welcome to today’s program, the Children’s Place third quarter conference call. At this time, all participants are in a listen-only mode. Later you’ll have an opportunity to ask questions during the question-and-answer session. You may register to ask a question anytime by pressing the star one on your touchtone phone. You may withdraw yourself from the queue by pressing the pound key. Please note this call may be recorded. I will be standing by should you need any assistance.
And it is now my pleasure to turn your conference over to Ms. Jane Singer. Please go ahead, ma’am.
Jane Singer
Thank you, Dian. Good morning, everyone. And thank you for joining us today for overview of the Children’s Place Retail Stores, Inc. third quarter 2009 financial results. Participating on this morning’s call are Chuck Crovitz, Interim Chief Executive Officer; and Sue Riley, Executive Vice President, Finance and Administration. Dina Sweeney, Senior Vice President of Merchandising is on hand to answer questions at the end of management’s remarks.
Before we begin, I would like to remind participants that any forward-looking remarks made today are subject to the Safe Harbor statements found in this morning’s press release, as well as, in our SEC filings.
These forward-looking statements involve risks and uncertainties that could cause our actual results to differ materially. The company undertakes no obligation to publicly release any revision to these forward-looking statements to reflect events or circumstances after the date hereof.
Please also note that a reconciliation of certain non-GAAP financial measures discussed on the call this morning is contained in this morning’s press release which can be found on our childrensplace.com website.
And now, I will turn the call over to Chuck for his opening remarks.
Charles K. Crovitz
Thank you, Jane. Good morning, everyone. Thank you for joining us today. We’re very pleased to have delivered sales and earnings growth in the third quarter of 2009 despite the ongoing economic uncertainty.
The Children’s Place delivered topline growth of 3% and income from continuing operations increased 34% to $38.2 million. Earnings per diluted share were $1.38, compared to $0.96 per share in the third quarter of last year.
We were also pleased to see customer transactions increase during the third quarter, while customers remain somewhat price sensitive we were encouraged to see a 1% increase in transactions during the third quarter following a 7% decline during the second quarter. Comp sales declined 2% due to the impact of promotional pricing on average transaction size consistent with what’s going on in the industry.
We attribute our success primarily to the resiliency of the children’s apparel market which has outperformed the sales of adult apparel. We believe the children’s category will continue to outperform adult apparel because it is more need based. Growing kids simply can’t wait for the economy to improve so moms can make their budgets stretch further for buying more of their children’s clothing at value oriented retailers.
