Chico's FAS, Inc. Reports Earnings Per Share Increase of 27% in Fourth Quarter and 32% in Fiscal 2012

Chico's FAS, Inc. Reports Earnings Per Share Increase of 27% in Fourth Quarter
                            and 32% in Fiscal 2012

--$0.20 fourth quarter earnings per share

--16th consecutive quarter of double digit earnings per share growth

--3.7% increase in fourth quarter comparable sales, on top of last year's 8.7%

PR Newswire

FORT MYERS, Fla., Feb. 28, 2013

FORT MYERS, Fla., Feb. 28, 2013 /PRNewswire/ --Chico's FAS, Inc. (NYSE: CHS)
today announced its financial results for the fiscal 2012 fourth quarter and
fiscal year ended February 2, 2013. The Company also provided its outlook.

(Logo: http://photos.prnewswire.com/prnh/20110920/FL71045LOGO )

For the fourteen-weeks ended February 2, 2013 (the fourth quarter), when
excluding non-recurring acquisition and integration costs related to the
Boston Proper acquisition, the Company reported net income of $32.7 million,
an increase of 29.8% compared to net income of $25.2 million in last year's
thirteen-week fourth quarter, and earnings per diluted share of $0.20, an
increase of 33.3% compared to $0.15 per diluted share in last year's fourth
quarter. Including non-recurring acquisition and integration costs, the
Company reported net income of $31.5 million, an increase of 25.6% compared to
net income of $25.1 million in last year's fourth quarter, and earnings per
diluted share of $0.19, an increase of 26.7% compared to $0.15 per diluted
share in last year's fourth quarter. These results represent the highest
fourth quarter earnings per share since 2005.

For the fifty-three weeks ended February 2, 2013 (fiscal 2012), when excluding
non-recurring acquisition and integration costs, the Company reported net
income of $182.2 million, an increase of 26.1% compared to net income of
$144.4 million for the fifty-two week year ended January 28, 2012 (fiscal
2011), and record earnings per diluted share of $1.09, an increase of 29.8%
compared to $0.84 per diluted share in fiscal 2011. Including non-recurring
acquisition and integration costs, the Company reported net income of $180.2
million, an increase of 27.9% compared to net income of $140.9 million in
fiscal 2011, and earnings per diluted share in fiscal 2012 of a record $1.08,
an increase of 31.7% compared to $0.82 per diluted share in fiscal 2011.

Net Sales

For the fourth quarter, net sales were $651.9 million, an increase of 14.5%
compared to $569.2 million in last year's fourth quarter, primarily reflecting
comparable sales growth of 3.7% and 101 net new stores for a square footage
increase of 8.1%. The 3.7% increase in comparable sales for the fourth quarter
followed an 8.7% increase in last year's fourth quarter, for a two-year stack
of 12.4%, and reflected increases in both average dollar sale and transaction
count. The comparable sales growth primarily reflected a positive customer
response to the fashion assortments and the effectiveness of the Company's
innovative marketing plans. The fifty-third week is excluded from comparable
sales calculations.

The Chico's/Soma Intimates brands' comparable sales increased 2.3%, which
followed a 5.5% increase in last year's fourth quarter for a two-year stack of
7.8%, and the White House | Black Market ("WH|BM") brand's comparable sales
increased 6.3%, which followed a 15.4% increase in last year's fourth quarter
for a two-year stack of 21.7%.

Gross Margin

For the fourth quarter, gross margin was $346.7 million compared to $297.9
million in last year's fourth quarter. As a percentage of net sales, gross
margin was 53.2%, a 90 basis point improvement from last year's fourth
quarter, primarily reflecting a higher level of full-price selling and
effective inventory management, partially offset by incentive compensation.

Selling, General and Administrative Expenses

For the fourth quarter, selling, general and administrative expenses ("SG&A")
were $296.1 million compared to $259.1 million in last year's fourth quarter.
As a percentage of net sales, SG&A was 45.4%, a 10 basis point improvement
from last year's fourth quarter, primarily reflecting sales leverage on
marketing and store expenses, partially offset by incentive compensation.

Inventories

At the end of the fourth quarter, total inventories were $206.8 million
compared to $194.5 million at the end of the fourth quarter last year.
Inventories increased by $12.4 million, or 6.4%, in line with planned sales
growth. 

Share Repurchase Program

During the fourth quarter of fiscal 2012, the Company repurchased 3.9 million
shares for $70.1 million under its $200 million share repurchase program
announced in November 2011. During fiscal 2012, the Company repurchased a
total of 6.3 million shares for $107.5 million.

Outlook

The Company's goal has been to establish financial targets that are both
sustainable and reflect strong growth metrics. The Company believes that by
delivering on its long-term objectives to increase sales by a low double-digit
percentage and diluted earnings per share by a mid-teen percentage over a
meaningful period of time, the Company will provide its shareholders with
substantial value.

Consistent with these objectives, the Company announced today several
strategic investments in 2013 to fuel future growth, including omni-channel
capabilities, expansion into Canada, and opening its first Boston Proper
stores.



A conference call to review the fourth quarter and fiscal year results is
scheduled for today at 8:30 a.m. EST. A live webcast of the call can be
accessed at the Events Calendar page of the Chico's FAS, Inc. corporate
website at www.chicosfas.com.

ABOUT CHICO'S FAS, INC.

The Company, through its brands – Chico's, White House | Black Market, Soma
Intimates, and Boston Proper, is a women's specialty retailer of private
branded, sophisticated, casual-to-dressy clothing, intimates, complementary
accessories, and other non-clothing items.

The Chico's brand offers women a combination of great style, one-of-a-kind
details and warm personal service. Chico's currently operates 611 boutiques
and 99 outlets throughout the U.S., mails a catalog and offers round-the-clock
shopping at www.chicos.com.

White House | Black Market strives to make women feel beautiful with apparel
and accessories in the honest simplicity of black and white and the
individuality of styles built from it. White House | Black Market currently
operates 401 boutiques and 45 outlets, mails a catalog highlighting its latest
fashions and connects with customers at www.whbm.com.

Soma Intimates offers beautiful and sensual lingerie, loungewear and beauty.
Soma Intimates currently operates 198 boutiques and 16 outlets, mails a
catalog coinciding with key shopping periods and sells direct-to-consumer at
www.soma.com. 

Boston Proper is a leading direct-to-consumer retailer of women's apparel and
accessories. Boston Proper provides unique, distinctive fashion designed for
today's independent, confident and active woman. The merchandise focus is
about creating a daring, modern style with a sensual feel and is available
exclusively through the Boston Proper catalog and website at
www.bostonproper.com.

SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995 Certain statements contained herein, including without limitation,
statements addressing the beliefs, plans, objectives, estimates or
expectations of the Company or future results or events constitute
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995, as amended. Such forward-looking statements
involve known or unknown risks, including, but not limited to, general
economic and business conditions, and conditions in the specialty retail
industry. There can be no assurance that the actual future results,
performance, or achievements expressed or implied by such forward-looking
statements will occur. Users of forward-looking statements are encouraged to
review the Company's latest annual report on Form 10-K, its filings on Form
10-Q, management's discussion and analysis in the Company's latest annual
report to stockholders, the Company's filings on Form 8-K, and other federal
securities law filings for a description of other important factors that may
affect the Company's business, results of operations and financial condition.
The Company does not undertake to publicly update or revise its
forward-looking statements even if experience or future changes make it clear
that projected results expressed or implied in such statements will not be
realized.

For more detailed information on Chico's FAS, Inc., please go to our corporate
website at www.chicosfas.com.

(Financial Tables Follow)



Chico's FAS, Inc.
Condensed Consolidated Statements of Income
(in thousands, except per share amounts)
                    Fifty-Three Weeks    Fifty-Two Weeks      Fourteen Weeks     Thirteen Weeks
                    Ended                Ended                Ended              Ended
                    February 2, 2013     January 28, 2012     February 2, 2013   January 28, 2012
                    (Unaudited)                               (Unaudited)        (Unaudited)
                    Amount       % of    Amount       % of    Amount     % of    Amount     % of
                                 Sales                Sales              Sales              Sales
Net sales:
Chico's/Soma        $ 1,647,476  63.8%   $ 1,460,518  66.5%   $ 395,844  60.7%   $ 354,052  62.2%
Intimates
White House | Black   809,775    31.4%     696,358    31.7%     226,302  34.7%     186,681  32.8%
Market
Boston Proper         123,806    4.8%      39,484     1.8%      29,706   4.6%      28,474   5.0%
Total net sales       2,581,057  100.0%    2,196,360  100.0%    651,852  100.0%    569,207  100.0%
Cost of goods sold    1,129,257  43.8%     969,989    44.2%     305,124  46.8%     271,335  47.7%
Gross margin          1,451,800  56.2%     1,226,371  55.8%     346,728  53.2%     297,872  52.3%
Selling, general
and administrative    1,161,105  45.0%     998,861    45.5%     296,118  45.4%     259,138  45.5%
expenses
Acquisition and       3,157      0.1%      5,133      0.2%      1,836    0.3%      148      0.0%
integration costs
Income from           287,538    11.1%     222,377    10.1%     48,774   7.5%      38,586   6.8%
operations
Interest income,      881        0.0%      1,597      0.1%      248      0.0%      212      0.0%
net
Income before         288,419    11.1%     223,974    10.2%     49,022   7.5%      38,798   6.8%
income taxes
Income tax            108,200    4.2%      83,100     3.8%      17,500   2.7%      13,700   2.4%
provision
Net income          $ 180,219    6.9%    $ 140,874    6.4%    $ 31,522   4.8%    $ 25,098   4.4%
Per share data:
Net income per      $ 1.09               $ 0.82               $ 0.19             $ 0.15
common share-basic
Net income per
common and common   $ 1.08               $ 0.82               $ 0.19             $ 0.15
equivalent
share–diluted
Weighted average
common shares         162,989              169,153              161,051            163,871
outstanding–basic
Weighted average
common and common     164,119              170,250              162,203            164,801
equivalent shares
outstanding–diluted
Dividends declared  $ 0.21               $ 0.20               $ 0.0525           $ 0.05
and paid per share





Chico's FAS, Inc.
Condensed Consolidated Balance Sheets
(in thousands)
                                            February 2, 2013  January 28, 2012
                                            (Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents                   $    56,859       $    58,919
Marketable securities, at fair value             272,499           188,934
Inventories                                      206,849           194,469
Prepaid expenses and other current assets        61,786            55,104
Total Current Assets                             597,993           497,426
Property and Equipment, net                      608,120           550,230
Other Assets:
Goodwill                                         238,693           238,693
Other intangible assets, net                     127,754           132,112
Other assets, net                                8,068             6,691
Total Other Assets                               374,515           377,496
                                            $    1,580,628    $    1,425,152
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable                            $    129,387      $    100,395
Other current liabilities                        173,024           137,714
Total Current Liabilities                        302,411           238,109
Noncurrent Liabilities:
Deferred liabilities                             132,374           125,690
Deferred taxes                                   52,644            52,125
Total Noncurrent Liabilities                     185,018           177,815
Stockholders' Equity:
Preferred stock                                  -                 -
Common stock                                     1,628             1,657
Additional paid-in capital                       348,775           302,612
Retained earnings                                742,580           704,631
Accumulated other comprehensive income      216               328
Total Stockholders' Equity                       1,093,199         1,009,228
                                            $    1,580,628    $    1,425,152






Chico's FAS, Inc.
Condensed Consolidated Cash Flow Statements
(in thousands)
                                            Fifty-three       Fifty-two
                                            Weeks Ended       Weeks Ended
                                            February 2, 2013  January 28, 2012
                                            (Unaudited)
Cash Flows From Operating Activities:
Net income                                  $    180,219      $    140,874
Adjustments to reconcile net income to net
cash provided by operating activities —
Depreciation and amortization                    108,467           99,430
Deferred tax (benefit) expense                   (4,208)           19,489
Stock-based compensation expense                 26,453            15,198
Excess tax benefit from stock-based              (7,952)           (2,643)
compensation
Deferred rent and lease credits                  (16,812)          (19,073)
Loss on disposal and impairment of property      2,765             2,949
and equipment
Changes in assets and liabilities, net of
effects of acquisition —
Inventories                                      (12,379)          (20,812)
Prepaid expenses and other assets                (3,956)           (3,491)
Accounts payable                                 28,992            (14,571)
Accrued and other liabilities                    66,683            37,831
Net cash provided by operating activities        368,272           255,181
Cash Flows From Investing Activities:
Purchases of marketable securities               (298,460)         (592,962)
Proceeds from sale of marketable securities      214,783           937,987
Acquisition of Boston Proper, Inc., net of       -                 (213,561)
cash acquired
Purchases of property and equipment, net         (164,690)         (131,757)
Net cash used in investing activities            (248,367)         (293)
Cash Flows From Financing Activities:
Proceeds from issuance of common stock           16,531            4,549
Excess tax benefit from stock-based              7,953             2,643
compensation
Dividends paid                                  (34,928)          (34,152)
Repurchase of common stock                       (111,521)         (183,290)
Cash paid for deferred financing costs           -                 (414)
Net cash used in financing activities            (121,965)         (210,664)
Net (decrease) increase in cash and cash         (2,060)           44,224
equivalents
Cash and Cash Equivalents, Beginning of          58,919            14,695
period
Cash and Cash Equivalents, End of period    $    56,859       $    58,919

Supplemental Detail on Earnings Per Share Calculation

In accordance with accounting guidance, unvested share-based payment awards
that include non-forfeitable rights to dividends, whether paid or unpaid, are
considered participating securities. As a result, such awards are required to
be included in the calculation of basic earnings per share pursuant to the
"two-class" method. For the Company, participating securities are comprised
of unvested restricted stock awards.

Earnings per share is determined using the two-class method, as it is more
dilutive than the treasury stock method. Basic earnings per share is computed
by dividing net income available to common stockholders by the
weighted-average number of common shares outstanding during the period.
Diluted earnings per share reflects the dilutive effect of potential common
shares from securities such as stock options and performance-based restricted
stock units.

The following table sets forth the computation of basic and diluted earnings
per share shown on the face of the accompanying consolidated statements of
income (in thousands, except per share amounts):





                           Fifty-three  Fifty-two    Fourteen     Thirteen
                           Weeks Ended  Weeks Ended  Weeks Ended  Weeks Ended
                           February 2,  January 28,  February 2,  January 28,
                           2013         2012         2013         2012
Numerator

                           $  180,219   $  140,874   $   31,522   $   25,098
Net income


Net income and dividends      (3,309)      (1,834)       (580)        (355)
declared
allocated to unvested
restricted stock


Net income available to    $  176,910   $  139,040   $   30,942   $   24,743
common
stockholders
Denominator


Weighted average common    162,988,767  169,152,870  161,051,252  163,871,369
shares
outstanding – basic
                                                              

Dilutive effect of         1,130,313    1,097,574    1,151,804    929,542
outstanding awards

                                                               
Weighted average common
and common                 164,119,080  170,250,444  162,203,056  164,800,911
equivalent shares
outstanding – diluted


Net income per common
share
Basic                      $  1.09      $  0.82      $   0.19     $   0.15
Diluted                    $  1.08      $  0.82      $   0.19     $   0.15





SEC Regulation G - The Company reports its consolidated financial results in
accordance with generally accepted accounting principles (GAAP). However, to
supplement these consolidated financial results, management believes that
certain non-GAAP operating results, which exclude certain non-recurring
charges including acquisition and integration costs, may provide a more
meaningful measure on which to compare the Company's results of operations
between periods. The Company believes these non-GAAP results provide useful
information to both management and investors by excluding certain expenses
that impact the comparability of the results. A reconciliation of net income
and earnings per diluted share on a GAAP basis to net income and earnings per
diluted share on a non-GAAP basis is presented in the table below:



Chico's FAS, Inc.
Non-GAAP to GAAP Reconciliation of Net Income and Diluted EPS
(in thousands, except per share amounts)
                            Fifty-three  Fifty-two    Fourteen     Thirteen
                            Weeks Ended  Weeks Ended  Weeks Ended  Weeks Ended
Net income:                 February 2,  January 28,  February 2,  January 28,
                            2013         2012         2013         2012
GAAP basis                  180,219      140,874      31,522       25,098
Add: Impact of acquisition
and integration costs, net  1,973        3,574        1,181        96
of tax
Non-GAAP adjusted basis     $182,192     $144,448     $32,703      $25,194
Net income per diluted
share:
GAAP basis                  1.08         0.82         0.19         $0.15
Add: Impact of acquisition
and integration costs, net  0.01         0.02         0.01         0.00
of
tax
Non-GAAP adjusted basis     $1.09        $0.84        $0.20        $0.15





Store Count and Square Footage
As of February 2, 2013
(Unaudited)
                     As of      New      Closures  As of
                     1/28/2012  Stores             2/2/2013
Store count:
Chico's frontline    601        14       (9)       606
boutiques
Chico's outlets      83         16       -         99
WH|BM frontline      364        40       (6)       398
boutiques
WH|BM outlets        27         18       -         45
Soma frontline       164        36       (7)       193
boutiques
Soma outlets         17         1        (2)       16
Total Chico's FAS,   1,256      125      (24)      1,357
Inc.
                     As of      New      Closures  Other changes in  As of
                     1/28/2012  Stores             SSF               2/2/2013
Net selling square
footage (SSF):
Chico's frontline    1,631,674  37,474   (21,583)  5,687             1,653,252
boutiques
Chico's outlets      213,475    38,371   -         -                 251,846
WH|BM frontline      768,442    102,689  (10,859)  12,911            873,183
boutiques
WH|BM outlets        53,263     38,356   -         -                 91,619
Soma frontline       326,858    70,446   (12,112)  (14,422)          370,770
boutiques
Soma outlets         32,676     1,716    (3,669)   50                30,773
Total Chico's FAS,   3,026,388  289,052  (48,223)  4,226             3,271,443
Inc.



Executive
Contact:
Todd Vogensen
Vice President-Investor
Relations
Chico's FAS, Inc.
(239) 346-4199

SOURCE Chico's FAS, Inc.

Website: http://www.chicos.com