BuildABear Workshop Inc. (BBW, Financial) filed Quarterly Report for the period ended 2010-10-02.
Buildabear Workshop Inc. has a market cap of $140.8 million; its shares were traded at around $6.99 with and P/S ratio of 0.4. BBW is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Commercial revenue, formerly referred to as licensing revenue, increased to $7.6 million for the thirteen weeks ended October 2, 2010 from $1.7 million for the thirteen weeks ended October 3, 2009, an increase of $6.0 million. This increase was primarily related to a single $5.8 million wholesale transaction with no associated gross margin. We also increased revenues through our collaboration with Michael s Stores and Borders. Revenue from franchise fees decreased to $0.8 million for the thirteen weeks ended October 2, 2010 from $0.9 million for the thirteen weeks ended October 3, 2009, a decrease of $0.1 million. This decrease was primarily due to the decline in the number of franchised locations and in franchisee store sales reflecting the global economic slowdown.
Gross margin. Total gross margin increased to $37.4 million for the thirteen weeks ended October 2, 2010 from $34.7 million for the thirteen weeks ended October 3, 2009, an increase of $2.7 million, or 7.7%. Retail gross margin increased to $35.4 million for the thirteen weeks ended October 2, 2010 from $32.7 million for the thirteen weeks ended October 3, 2009, an increase of $2.7 million, or 8.3%. As a percentage of net retail sales, retail gross margin increased to 38.6% for the thirteen weeks ended October 2, 2010 from 36.5% for the thirteen weeks ended October 3, 2009, an increase of 210 basis points as a percentage of net retail sales (bps). This increase resulted primarily from improved sales leverage on store occupancy costs and a slight improvement in merchandise margin.
Selling, general and administrative. Selling, general and administrative expenses decreased to $39.1 million for the thirteen weeks ended October 2, 2010 from $39.3 million for the thirteen weeks ended October 3, 2009. As a percentage of total revenues, excluding the single wholesale transaction, selling, general and administrative expenses decreased to 41.5% for the thirteen weeks ended October 2, 2010 as compared to 42.5% for the thirteen weeks ended October 3, 2009, a decrease of 100 bps. The decrease in selling, general and administrative expenses as a percent of revenue was primarily due to leverage on store salaries and other fixed components of overhead costs as well as a shift in the timing of certain marketing programs. These improvements were partially offset by charges related to the decision to close a small number of stores within the fiscal year.
Store preopening. Store preopening expense was $0.3 for the thirteen weeks ended October 2, 2010 as compared to $0.1 million for the thirteen weeks ended October 3, 2009. The increase in store preopening for the period was the result of three store openings in the 2010 third quarter as compared to one store opening in the same period last year. Additionally, we plan to open 11 pop-up stores in the 2010 fourth quarter. Preopening expenses include expenses for stores that opened in the current period as well as expenses incurred for stores that will open in future periods.
Interest expense (income), net. Interest income, net of interest expense, was $83,000 for the thirteen weeks ended October 2, 2010 as compared to $44,000 for the thirteen weeks ended October 3, 2009.
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Buildabear Workshop Inc. has a market cap of $140.8 million; its shares were traded at around $6.99 with and P/S ratio of 0.4. BBW is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
Total revenues. Net retail sales increased to $91.7 million for the thirteen weeks ended October 2, 2010 from $89.7 million for the thirteen weeks ended October 3, 2009, an increase of $2.0 million, or 2.2%. This increase was primarily attributable to a $2.6 million increase in comparable store sales, a $0.8 million increase in other non-store locations and a $0.4 million increase in sales from new stores. These increases were partially offset by a $0.7 million negative impact of foreign currency translation, $0.6 million in changes in deferred revenue and $0.5 million decreased sales from non-comparable locations.Commercial revenue, formerly referred to as licensing revenue, increased to $7.6 million for the thirteen weeks ended October 2, 2010 from $1.7 million for the thirteen weeks ended October 3, 2009, an increase of $6.0 million. This increase was primarily related to a single $5.8 million wholesale transaction with no associated gross margin. We also increased revenues through our collaboration with Michael s Stores and Borders. Revenue from franchise fees decreased to $0.8 million for the thirteen weeks ended October 2, 2010 from $0.9 million for the thirteen weeks ended October 3, 2009, a decrease of $0.1 million. This decrease was primarily due to the decline in the number of franchised locations and in franchisee store sales reflecting the global economic slowdown.
Gross margin. Total gross margin increased to $37.4 million for the thirteen weeks ended October 2, 2010 from $34.7 million for the thirteen weeks ended October 3, 2009, an increase of $2.7 million, or 7.7%. Retail gross margin increased to $35.4 million for the thirteen weeks ended October 2, 2010 from $32.7 million for the thirteen weeks ended October 3, 2009, an increase of $2.7 million, or 8.3%. As a percentage of net retail sales, retail gross margin increased to 38.6% for the thirteen weeks ended October 2, 2010 from 36.5% for the thirteen weeks ended October 3, 2009, an increase of 210 basis points as a percentage of net retail sales (bps). This increase resulted primarily from improved sales leverage on store occupancy costs and a slight improvement in merchandise margin.
Selling, general and administrative. Selling, general and administrative expenses decreased to $39.1 million for the thirteen weeks ended October 2, 2010 from $39.3 million for the thirteen weeks ended October 3, 2009. As a percentage of total revenues, excluding the single wholesale transaction, selling, general and administrative expenses decreased to 41.5% for the thirteen weeks ended October 2, 2010 as compared to 42.5% for the thirteen weeks ended October 3, 2009, a decrease of 100 bps. The decrease in selling, general and administrative expenses as a percent of revenue was primarily due to leverage on store salaries and other fixed components of overhead costs as well as a shift in the timing of certain marketing programs. These improvements were partially offset by charges related to the decision to close a small number of stores within the fiscal year.
Store preopening. Store preopening expense was $0.3 for the thirteen weeks ended October 2, 2010 as compared to $0.1 million for the thirteen weeks ended October 3, 2009. The increase in store preopening for the period was the result of three store openings in the 2010 third quarter as compared to one store opening in the same period last year. Additionally, we plan to open 11 pop-up stores in the 2010 fourth quarter. Preopening expenses include expenses for stores that opened in the current period as well as expenses incurred for stores that will open in future periods.
Interest expense (income), net. Interest income, net of interest expense, was $83,000 for the thirteen weeks ended October 2, 2010 as compared to $44,000 for the thirteen weeks ended October 3, 2009.
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