CORRECTING and REPLACING Tumi Holdings Announces Financial Results for the Third Quarter of 2012

CORRECTING and REPLACINGTumi Holdings Announces Financial Results for the Third Quarter of 2012

SOUTH PLAINFIELD, N.J.--(BUSINESS WIRE)-- Please replace the release with the following corrected version due to multiple revisions.

The corrected release reads:


TUMI HOLDINGS ANNOUNCES FINANCIAL RESULTS FOR THE THIRD QUARTER OF 2012

Tumi Holdings, Inc. (NYS: TUMI) , the leading global brand of premium travel, business and lifestyle products and accessories, today announced its financial results for the third quarter ended September 23, 2012.

For the third quarter of 2012:

  • Net sales increased 22.3% to $95.9 million from $78.4 million in the third quarter ended September 25, 2011.

  • For all Direct-to-Consumer channels, comparable store sales increased 10.9%, following an increase of 23.9% in the third quarter of 2011.

  • Direct-to-Consumer North America comparable store sales (including e-commerce sales) increased 10.7%, following an increase of 24.7% in the third quarter of 2011. Excluding e-commerce sales, Direct-to-Consumer North America comparable store sales increased 8.0%, following an increase of 21.4% in the third quarter of 2011.

  • Direct-to-Consumer International comparable store sales in local currency increased 21.8% excluding e-commerce sales, and 27.0% including e-commerce sales. In U.S. dollars, Direct-to-Consumer International comparable store sales increased 7.7% excluding e-commerce sales and 12.4% including e-commerce sales.

  • Gross profit increased by 22.7% to $55.2 million from $45.0 million in the third quarter of 2011. Gross margin was 57.6% compared to 57.4% in the third quarter of 2011.

  • Operating income increased by 42.2% to $17.3 million from $12.1 million in the third quarter of 2011. Operating income margin was 18.0% compared to 15.5% in the third quarter of 2011.

  • Net income was $10.5 million, or $0.15 per diluted share based on 67.9 million diluted weighted average common shares outstanding, as compared to $1.6 million, or $0.03 per diluted share based on 52.5 million diluted weighted average common shares outstanding in the third quarter of 2011.

  • During the third quarter of 2012, Tumi opened 5 new stores.

  • At September 23, 2012, Tumi operated 111 company-owned stores.

Jerome Griffith, Chief Executive Officer, President and Director, commented, "We were extremely pleased with the continued momentum in our business during the third quarter. Our results reflected our ability to capitalize on our market position as an iconic global premium lifestyle brand to broaden our product offering beyond travel related merchandise and to expand into international markets where we are achieving exceptional growth despite difficult market conditions. Our recent successes have increased our conviction that significant long-term opportunities lie ahead."

For the first nine months ended September 23, 2012:

  • Net sales for the first nine months of 2012 increased 21.8% to $271.7 million from $223.0 million in the same period of 2011.

  • Gross profit for the first nine months of 2012 increased 23.5% to $155.3 million, or 57.1% as a percentage of net sales, from $125.7 million, or 56.4% as a percentage of net sales in the same period of 2011.

  • Operating income increased 21.3% to $42.6 million from $35.1 million in the first nine months of 2011. Excluding the one-time special bonus of $5.5 million, operating income grew 37.0% to $48.1 million, or 17.7% of net sales, compared to $35.1 million, or 15.7% of net sales, in the first nine months of 2011.

  • Net income for the first nine months of 2012 was $19.8 million, or $0.32 per diluted share based on 61.6 million diluted weighted average common shares outstanding, as compared to $3.8 million, or $0.07 per diluted share based on 52.5 million diluted weighted average common shares outstanding for the first nine months of 2011.

  • Net income before preferred dividend expense (non-cash), a non-GAAP financial measure, which excluded non-cash dividend expense on mandatorily redeemable preferred stock and preferred equity interests of $7.9 million, was $27.7 million or $0.45 per diluted share for the first nine months of 2012. Excluding the aforementioned one-time special bonus expense of $3.1 million after tax, net income before preferred dividend expense (non-cash) was $30.8 million, or $0.50 per diluted share for the first nine months of 2012. In the first nine months of 2011, net income before preferred dividend expense (non-cash) was $21.0 million, or $0.40 per diluted share, which excluded $17.1 million of non-cash dividend expense on mandatorily redeemable preferred stock and preferred equity interests.

Balance Sheet Highlights as of September 23, 2012:

Cash and cash equivalents were $16.4 million compared with $22.0 million as of September 25, 2011. Inventories were $79.3 million compared with $60.9 million as of September 25, 2011. The increase in inventory was primarily due to increased production to support new product introductions and store growth.

Outlook

For fiscal 2012, net sales are expected to be in the range of $395 million to $400 million. This estimate assumes a comparable store sales growth in the mid to high single digit range. Net income is expected to be in the range of $35.0 million to $37.0 million. Diluted earnings per share are expected to be in the range of $0.53 to $0.56 per diluted share. This estimate assumes diluted weighted average common shares outstanding of approximately 63.3 million. Net income before preferred dividend expense (non-cash), a non-GAAP financial measure, which excludes non-cash dividend expense on mandatorily redeemable preferred stock and preferred equity interests, and assuming a normalized 39% tax rate, is expected to be in the range of $42.0 million to $44.0 million. On a diluted earnings per share basis, this represents a range of $0.66 to $0.69 per share. Excluding the aforementioned one-time special bonus expense of $3.1 million after tax, net income before preferred dividend expense (non-cash) is expected to be in the range of $45.0 million to $47.0 million. On a diluted earnings per share basis, this represents a range of $0.70 to $0.73 per share.

Capital expenditures for fiscal 2012 are expected to be in the range of $17.0 million to $20.0 million.

Conference Call

The conference call previously scheduled for 4:30 p.m. ET on Monday, October 29, 2012 has been cancelled due to technical difficulties related to Tropical Storm Sandy. Management's prepared conference call remarks regarding Tumi's third quarter 2012 earnings results will be furnished on Current Report on Form 8-K with the SEC and will be available in the investor relations section of Tumi's website www.tumi.com.

About Tumi

Tumi is the leading global brand of premium travel, business and lifestyle products and accessories. The brand is sold in approximately 200 stores from New York to Paris to London and Tokyo, as well as in the world's top department, specialty, and travel retail stores in over 70 countries.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect Tumi's current views with respect to, among other things, future events and performance. These statements may discuss net sales, gross margin, operating expenses, operating income, net income, cash flow, financial condition, impairments, expenditures, growth, strategies, plans, achievements, dividends, capital structure, organizational structure, future store openings, market opportunities and general market and industry conditions. Tumi generally identifies forward-looking statements by words such as "anticipate," "estimate," "expect," "intend," "project," "plan," "predict," "believe," "seek," "continue," "outlook," "may," "might," "will," "should," "can have," "likely" or the negative version of these words or comparable words. Forward-looking statements are based on beliefs and assumptions made by management using currently available information. These statements are only predictions and are not guarantees of future performance, actions or events. Forward-looking statements are subject to risks and uncertainties. If one or more of these risks or uncertainties materialize, or if management's underlying beliefs and assumptions prove to be incorrect, actual results may differ materially from those contemplated by a forward-looking statement. These risks and uncertainties include those set forth under "Risk Factors" in Tumi's filings with the Securities and Exchange Commission, including its Quarterly Report on Form 10-Q for the quarter ended March 25, 2012, filed with the SEC on May 23, 2012. Forward-looking statements speak only as of the date on which they are made. Tumi expressly disclaims any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

TUMI HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(In thousands, except share and per share data)

Three Months Ended

Nine Months Ended

September 23,
2012

September 25,
2011

September 23,
2012

September 25,
2011

(unaudited)

(unaudited)

Net sales

$

95,860

$

78,394

$

271,704

$

222,987

Cost of sales

40,685

33,410

116,431

97,303

Gross margin

55,175

44,984

155,273

125,684

OPERATING EXPENSES

Selling

6,517

5,876

17,597

15,182

Marketing

3,191

3,480

9,505

9,203

Retail operations

20,781

17,127

57,117

47,587

General and administrative

7,436

6,371

28,494

18,615

Total operating expenses

37,925

32,854

112,713

90,587

Operating income

17,250

12,130

42,560

35,097

OTHER INCOME (EXPENSES)

Interest expense

(284

)

(639

)

(1,151

)

(2,155

)

Dividend expense on mandatorily redeemable preferred stock and preferred equity interests

(5,714

)

(7,892

)

(17,143

)

Earnings from joint venture investment

161

399

832

681

Foreign exchange gains (losses)

432

(105

)

(263

)

106

Other non-operating income

34

34

261

133

Total other income (expenses)

343

(6,025

)

(8,213

)

(18,378

)

Income before income taxes

17,593

6,105

34,347

16,719

Provision for income taxes

7,129

4,514

14,501

12,911

Net income

$

10,464

$

1,591

$

19,846

$

3,808

Weighted average common shares outstanding:

Basic

67,866,667

52,536,224

61,613,373

52,536,224

Diluted

67,866,667

52,536,224

61,613,403

52,536,224

Basic earnings per common share

$

0.15

$

0.03

$

0.32

$

0.07

Diluted earnings per common share

$

0.15

$

0.03

$

0.32

$

0.07

TUMI HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(In thousands, except share and per share data)

September 23,
2012

December 31,
2011

(unaudited)

ASSETS

CURRENT ASSETS

Cash and cash equivalents

$

16,396

$

32,735

Accounts receivable, less allowance for doubtful accounts of approximately $475 and $462 at September 23, 2012 and December 31, 2011, respectively

23,820

22,833

Other receivables

1,838

1,724

Inventories

79,335

60,456

Prepaid expenses and other current assets

3,825

3,056

Prepaid income taxes

4,888

Deferred offering costs

1,996

Deferred tax assets, current

2,218

2,218

Total current assets

132,320

125,018

Property, plant and equipment, net

42,641

36,500

Deferred tax assets, noncurrent

2,046

2,046

Joint venture investment

2,842

2,122

Goodwill

142,773

142,773

Intangible assets, net

131,014

131,219

Deferred financing costs, net of accumulated amortization of $2,717 and $2,539 at September 23, 2012 and December 31, 2011, respectively

742

920

Other assets

4,892

5,743

Total assets

$

459,270

$

446,341

TUMI HOLDINGS, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets (continued)

(In thousands, except share and per share data)

September 23,
2012

December 31,
2011

(unaudited)

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES

Accounts payable

$

32,330

$

27,308

Accrued expenses

25,946

26,683

Current portion of long-term debt

12,000

Income taxes payable

4,324

Total current liabilities

58,276

70,315

Revolving credit facility

52,000

Long-term debt

52,000

Other long-term liabilities

7,101

6,257

Mandatorily redeemable preferred stock and preferred equity interests

251,429

Deferred tax liabilities

47,623

47,623

Total liabilities

165,000

427,624

Commitments and contingencies

STOCKHOLDERS' EQUITY

Common stock—$0.01 par value; 350,000,000 shares authorized, 68,144,473 issued and 67,866,667 shares outstanding as of September 23, 2012; 52,536,252 authorized and issued and 52,536,224 shares outstanding as of December 31, 2011

681

525

Preferred stock—$0.01 par value; 75,000,000 shares authorized and no shares issued or outstanding as of September 23, 2012; no shares authorized, issued or outstanding as of December 31, 2011

Additional paid-in capital

308,520

48,968

Treasury stock, at cost

(4,874

)

(174

)

Accumulated deficit

(9,771

)

(29,617

)

Accumulated other comprehensive loss

(286

)

(985

)

Total stockholders' equity

294,270

18,717

Total liabilities and stockholders' equity

$

459,270

$

446,341

TUMI HOLDINGS, INC. AND SUBSIDIARIES

Segment Results

(In thousands)

Direct-to-
Consumer
North
America

Direct-to-
Consumer
International

Indirect-to-
Consumer
North
America

Indirect-to-
Consumer
International

Non-
Allocated
Corporate
Expenses

Consolidated
Totals

Three Months Ended September 23, 2012

Net sales

$

40,486

$

4,829

$

24,963

$

25,582

$

$

95,860

Operating income (loss)

$

11,771

$

249

$

9,588

$

7,529

$

(11,887

)

$

17,250

Depreciation and amortization

$

1,504

$

243

$

223

$

578

$

393

$

2,941

Three Months Ended September 25, 2011

Net sales

$

33,234

$

4,230

$

16,166

$

24,764

$

$

78,394

Operating income (loss)

$

9,165

$

501

$

5,695

$