SOURCE: Big Dog Holdings, Inc.

July 29, 2005 14:33 ET

Big Dog Holdings, Inc. Announces Second Quarter 2005 Financial Results

SANTA BARBARA, CA -- (MARKET WIRE) -- July 29, 2005 -- Big Dog Holdings, Inc. (NASDAQ: BDOG) (www.bigdogs.com, www.thewalkingcompany.com), a developer and retailer of branded, lifestyle consumer products, today reported the financial results for the second quarter ended June 30, 2005.

For the quarter ended June 30, 2005, consolidated net sales were $43,441,000 as compared with $41,044,000 in the second quarter 2004. Our consolidated retail sales increased 6%, primarily due to comparative store sales increase of 7%. Comparative store sales declined 2.5% for the Big Dogs chain and increased 18.3% for the TWC chain. Consolidated gross profit increased to $24,680,000 in the second quarter 2005 as compared with $23,031,000 in the second quarter 2004. The overall increase in consolidated gross profit is the result of increased sales as well as an increase in margin contribution from Big Dog and TWC. Big Dogs' margin contribution for the period increased to 61.7% as compared to last year's margin contribution of 60.5% and the gross margin for the TWC chain increased to 51.8% as compared to 50.5% for 2004.

Consolidated operating expenses in the second quarter 2005 were $21,613,000 or 49.8% of sales compared to $20,813,000 or 50.7% in the second quarter 2004. The decrease in such expenses as a percentage of sales is attributable to leveraging these expenses over a larger revenue base. The consolidated fully diluted net income per share for the second quarter 2005 increased to $.18 per share, as compared with a consolidated fully diluted net income per share of $.14 for the second quarter 2004.

Andrew Feshbach, Chief Executive Officer, stated, "We are very pleased with the results of our 2nd quarter and improvements over last year and continue to see this trend going into our 3rd quarter for both chains."

Other Business:

As previously announced, the Company signed a definitive agreement to purchase the assets of Footworks, a division of the privately held shoe retailer, Bianca of Nevada, Inc. for approximately $10 million. Footworks operates a chain of 8 retail stores selling comfort shoes and accessories. This transaction is working toward completion and is expected to close in August.

Big Dog Holdings, Inc. consists of Big Dogs and The Walking Company. Big Dogs develops, markets and retails a branded, lifestyle collection of unique, high-quality, popular-priced consumer products, including activewear, casual sportswear, accessories and gifts. The BIG DOGS® brand image is one of quality, value and fun. The BIG DOGS® brand is designed to appeal to people of all ages and demographics, particularly baby boomers and their kids, big and tall customers, and pet owners. In addition to its 181 retail stores, Big Dogs markets its products through its catalog, licensing and corporate sales accounts and Internet sales. The Walking Company is a leading independent specialty retailer of high-quality, technically designed comfort footwear and accessories that features premium brands such as ECCO, Mephisto, Dansko, Birkenstock and Merrell among many others. These products have particular appeal to one of the largest and most rapidly growing demographics in the nation. The Walking Company operates 77 stores in premium malls across the nation.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995 -- With the exception of historical information, the matters discussed in this press release are forward looking statements that involve a number of risks and uncertainties. The actual future sales and other results of the Company could differ significantly from those statements. Further information on the Company's risk factors is contained in the Company's quarterly and annual reports as filed with the Securities and Exchange Commission.


                     BIG DOG HOLDINGS, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                 (Unaudited)

                                                        June 30,
                                                  2005            2004
                                             -----------     -----------
                     ASSETS
CURRENT ASSETS:
    Cash and cash equivalents                $   594,000     $ 1,525,000
    Receivables, net                             767,000         229,000
    Inventories                               44,407,000      41,653,000
    Prepaid expenses and
     other current assets                      1,965,000       1,111,000
    Deferred income taxes                      1,855,000       1,559,000
                                             -----------     -----------
       Total current assets                   49,588,000      46,077,000
PROPERTY AND EQUIPMENT, Net                    9,988,000      10,673,000
INTANGIBLE ASSETS, Net                           172,000         217,000
DEFERRED INCOME TAXES                          1,690,000       1,394,000
OTHER ASSETS                                     309,000         448,000
                                             -----------     -----------
    TOTAL                                    $61,747,000     $58,809,000
                                             ===========     ===========

            LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
    Short-term borrowings                    $ 7,384,000     $ 8,496,000
    Current portion of long-term debt            246,000         261,000
    Accounts payable                           5,006,000       5,055,000
    Income taxes payable                          72,000          83,000
    Accrued expenses and
     other current liabilities                 5,376,000       5,696,000
                                             -----------     -----------
       Total current liabilities              18,084,000      19,591,000
NOTE PAYABLE                                     109,000         487,000
CAPITAL LEASE OBLIGATIONS                        152,000         351,000
DEFERRED RENT AND LEASE INCENTIVES             1,333,000         690,000
DEFERRED GAIN ON SALE-LEASEBACK                  222,000         274,000
                                             -----------     -----------
    Total liabilities                         19,900,000      21,393,000
STOCKHOLDERS' EQUITY                          41,847,000      37,416,000
                                             -----------     -----------
    TOTAL                                    $61,747,000     $58,809,000
                                             ===========     ===========

                  BIG DOG HOLDINGS, INC. AND SUBSIDIARIES
                   CONSOLIDATED STATEMENTS OF OPERATIONS
                               (Unaudited)

                           Three Months Ended         Six Months Ended
                                 June 30,                  June 30,
                            2005         2004         2005         2004
                        -----------  -----------  -----------  -----------

NET SALES               $43,441,000  $41,043,000  $74,786,000  $62,924,000
COST OF GOODS SOLD       18,761,000   18,013,000   33,879,000   28,672,000
                        -----------  -----------  -----------  -----------
GROSS PROFIT             24,680,000   23,030,000   40,907,000   34,252,000
                        -----------  -----------  -----------  -----------
OPERATING EXPENSES:
  Selling, marketing
   and distribution      19,327,000   18,875,000   37,594,000   33,008,000
  General and
   administrative         2,286,000    1,936,000    4,029,000    3,733,000
                        -----------  -----------  -----------  -----------
    Total operating
     expenses            21,613,000   20,811,000   41,623,000   36,741,000
                        -----------  -----------  -----------  -----------
INCOME (LOSS) FROM
 OPERATIONS               3,067,000    2,219,000     (716,000)  (2,489,000)
OTHER INCOME                      -       82,000            -       82,000
INTEREST INCOME               1,000       64,000       41,000       70,000
INTEREST EXPENSE           (297,000)    (347,000)    (448,000)    (477,000)
                        -----------  -----------  -----------  -----------
INCOME (LOSS) BEFORE
 PROVISION (BENEFIT)
 FOR INCOME TAXES         2,771,000    2,018,000   (1,123,000)  (2,814,000)
PROVISION (BENEFIT) FOR
 INCOME TAXES             1,053,000      767,000     (427,000)  (1,069,000)
                        -----------  -----------  -----------  -----------
NET INCOME (LOSS)       $ 1,718,000  $ 1,251,000  $  (696,000) $(1,745,000)
                        ===========  ===========  ===========  ===========
NET INCOME (LOSS)
 PER SHARE
  BASIC                 $      0.19  $      0.15  $     (0.08) $     (0.21)
                        ===========  ===========  ===========  ===========
  DILUTED               $      0.18  $      0.14  $     (0.08) $     (0.21)
                        ===========  ===========  ===========  ===========

WEIGHTED AVERAGE SHARES
 OUTSTANDING:

  BASIC                   9,182,000    8,261,000    9,181,000    8,252,000
                        ===========  ===========  ===========  ===========
  DILUTED                 9,756,000    8,907,000    9,181,000    8,252,000
                        ===========  ===========  ===========  ===========

For Further Information:

Big Dog Holdings, Inc.
121 Gray Avenue
Santa Barbara, California 93101
www.bigdogs.com
www.walkingcompany.com

Contact Information

  • CONTACT:
    Laura Russell
    Investor Information
    (805) 963-8727, ext. 1360
    Email Contact