Ladies and gentlemen,
Shop The Latest Nike Air Yeezy 2 With Free Shipping 70% Discount Off, thank you for standing by, and welcome to todays conference call. At this time, all lines are in listen only mode. Later, there will be an opportunity for questions, and instructions will be given at that time. [Operator Instructions]. And as a reminder, today’s conference is being recorded.
I would now like to turn the conference over to James Grant. Please go ahead sir,
Online Womens Nike Air Yeezy Red October For Sale.
Good afternoon and welcome to Collective Brands Conference Call and the results of Payless ShoeSource’s Second quarter of 2007. I am James Grant, Director of Investor Relations. Our call today will begin with Rick Porzig, Senior Vice President and Chief Financial Officer, followed by Matt Rubel, Chief Executive Officer and President. After we complete our prepared remarks, Matt and Rick will take your questions.
Our remarks today will contain forward looking statements which are not historical facts and are subject to a number of risks and uncertainties,
70% Off 2014 Cheap Nike Air Yeezy 2 For Sale With Authentic Quality. Actual results may differ materially,
Order Authentic Nike Air Yeezy For Sale Gift For You Or Your Family. Please refer to today’s press release for more information on risk factors.
And now,
Cheapest Nike Air Yeezy 2 For Sale With Top Quality And Fast Delivery, I would like to turn the call over to Rick.
Ullrich E. Porzig Senior Vice President and Chief Financial Officer
Thanks, James, and good afternoon,
Buy Authentic Mens Nike Air Yeezy Shoes Outlet Sale Womens Mens 2015, everyone. Second quarter 2007 net earnings were $25 million or $0.38 per diluted share, down 23% versus the second quarter of 2006. However, this $0.10 per diluted share decline was impacted by the following.
Second quarter 2007 expenses related to the Companys distribution center initiative including the exit from one facility and the temporary redundancies between facilities. Those expenses totaled $3.6 million pretax or $0.04 per diluted share,
Order Online Nike Air Yeezy Red October Extra 50% Off Clearance Items. Second quarter 2007 expenses related to the integration and planning of Stride Rite. Those expenses totaled $1,
Websites For Authentic Nike Air Yeezy 2 New Collection Is Available.8 million pretax or $0.02 per diluted share.
Second quarter 2006 income related to Payless receipt of Visa Check/Mastermoney antitrust settlement proceeds and the income totaled $2.3 million pretax or $0.02 per diluted share. In second quarter 2006, income related to Payless insurance recoveries due to hurricane. The net incremental income over 2007 totaled $1.6 million pretax or $0.02 per diluted share.
Now, I would like to walk you through the second quarter 2007 financial statements and explain the drivers behind these results. Let’s start with sales.
Second quarter sales totaled $699 million, a decrease of 1% over the second quarter of 2006. Same store sales were down 1.4% for the second quarter of this year. Importantly, we did pick up market share during the quarter according to industry reports. So,
Wholesale Nike Air Yeezy Red October Good Guality And Medium Price, we are very pleased with that achievement,
Outlet Store Online To Buy Cheap Nike Air Yeezy Shoes For Sale Shoes, in spite of overall sales performance.
Second quarter 2007 sales were unfavorably driven by the following factors. First, weak results in our sandal business which caused total unit sales to decline by 2%. And second,
100% Finest Grade Nike Air Yeezy 2 Red October Running Shoes For Sale, the later timings of the back to school to season. Certain key markets shifted there as school start dates a couple of weeks later. These factors were mostly offset by the following related favorable drivers. We converted a higher percentage of customers in our stores and sold more units per transaction. Athletic and casual footwear performed particularly well and average unit retails were up 1%.
Now on to gross margin. Gross margin was 34.4% of sales in the second quarter of 2007,
Online Womens Nike Air Yeezy 2 For Sale Extra 50% Off Clearance Items, down 20 basis points. The gross margin rate was driven principally by the following factors. Higher initial mark on enhanced by more direct sourcing, mark downs on most types of sandals,
Buy Authentic Womens Nike Air Yeezy For Sale For Sale Authentic Shoes, investments in our distribution center infrastructure and last years hurricane insurance recoveries. The latter two factors, as I quantified earlier are negatively impact the gross margin by a combined 73 basis points.
Selling, general and administrative expenses as a percent of sales was 28.7% in the second quarter of 2007 versus 24.7% last year, an increase of 130 basis points. The de leverage was due primarily to lower sales of sandals rather than a growth in expenses. SG expenses for the quarter were $201 million,
How Can i Buy Nike Air Yeezy For Sale Good Guality And Medium Price, up 3.9% versus last year. The increase was primarily driven by higher payroll, last years antitrust settlement and the Stride Rite integration planning costs,
70% Off 2014 Cheap Nike Air Yeezy 2 You Can Enjoy Fast Free Shipping, principally professional services. The latter two factors, as I quantified earlier negatively impacted SG by combined 59 basis points.
We had net interest expense of $800,000 in the second quarter of 2007 versus net interest income of $700,000 in the same period last year. The change was driven by lower cash balances this year. As previously communicated, the Company financed the portion of its acquisition of Stride Rite with a $725 million term loan B at a variable rate of 8.3% over seven years. On August 24, 2007, Company entered into an interest rate swap arrangement for $540 million, which provides for a fixed interest rate of approximately 7.75%, portions of which mature on a series of dates over the next five years.
Our income tax provision was $12.7 million in the second quarter of 2007 versus $17.3 million in the prior year period. The lower tax provision was due in part to lower pretax earnings. Our effective income tax rate of 32.8% on continuing operations was down compared to 34% last year due primarily to reinstating of certain federal employment tax credits and a decrease in the effective tax rate related to our international operations. The full year effective tax rate on continuing operations, including discrete events known at this time is projected to be approximately 33%.
Minority interest represents a 40% share earnings due to our joint venture partners in Latin America. Second quarter 2007 monitory interest was $1.3 million compared to $600,000 in the same period last year. The increase was due to our stronger results in our Latin American business.
Second quarter net earnings from continuing operations were $24.7 million this year versus $33 million last year. Our cash and short term investments at quarter end were at $327 million, down $114 million or 26% over the previous year. The decrease was due primarily to the first quarter 2007 acquisition of Collective Licensing International.
Our total inventory at the end of the second quarter 2007 was $370 million compared to $351 million at the end of the second quarter of 2006. Inventory quality at quarter end was better because aged unit as a percent of total inventory was lower. The increase in inventory was driven primarily by the following factors. We had greater investments in strong performing product categories for fall,
How To Order Nike Air Yeezy 2 You Can Always Find Out Your Favorite, merchandised mix shift towards our footwear at higher average cost linked to higher average retail in the initial mark on, and an increase in longer lead time raw material commitments associated with a higher percentage of products sourced directly by Payless.
Regarding our fixed assets, our capital expenditures through the first half of fiscal 2007 totaled $93 million, up $40 million from the same period last year. The increase was due primarily to greater investments in the Companys supply chain and Payless stores. Collective Brands capital expenditures for fiscal 2007 are expected to total about $175 million. This higher level of investment is driven predominately by our new distribution center initiative. We will also continue to invest meaningfully in our retail store base to improve our customers shopping experience.
And as for share repurchases,
Offers You Many High Quality Nike Air Yeezy 2 For Sale For Sale Mens, during the second quarter of 2007, we repurchased 141,
Official Site Nike Air Yeezy 2 For Sale Outlet Sale Womens Mens 2015,000 shares for $4.6 million during under our stock repurchase program in accordance with our debt covenants. We may repurchase approximately $32 million more of our stock at this time. This limit will continue to adjust quarterly based on our net earnings.
Regarding the Collective Brands financial outlook, Collective Brands is expected to have strong pro forma financials, excluding the impact of purchase accounting. The acquisition is expected to be accretive to earnings per share in 2008, as the Stride Rite unit’s earnings contribution is expected to exceed the incremental interest expense. Due to the impact of purchase accounting, the Stride Rite acquisition is not expected to be earnings per share accretive in fiscal year 2008 on a GAAP basis. Excluding the purchase accounting, the 2006 to 2009 compound annual growth rate in operating profit is expected to be in the mid to upper teens. Including purchase accounting, the 2006 to 2009 compound annual growth rate in operating profit is expected to be in the low teens on a GAAP basis.
And now, I will turn the call over to Matt Rubel.
Matthew E. Rubel Chief Executive Officer and President
Thanks, Rick and good afternoon everyone. Today, its my pleasure to address the investment community for the first time representing our new Company Collective Brands. Collective Brands is a global footwear, accessory and lifestyle brand company that reaches customers through multiple price points and multiple selling channels, such as retail,
Size 7 Cheap Nike Air Yeezy 2 Lower Price, wholesale, licensing, and e commerce.
Later in my remarks, I will address some of the strategies we are pursuing related to our recently acquired Stride Rite unit and the corresponding impact on our new company, Collective Brands. But first, I will provide you with some commentary on recent Payless performance and how we are progressing on the Payless strategy.
While our second quarter results underperformed our expectations, we are pleased that according to the survey prepared by the footwear distributors and retailers of America, we were successful in continuing the grow market share. I will also mention that while on a fiscal basis, our comp store sales were down 1.4%, on a calendar basis which reflects how our customers shop, our comp store sales were flat to last year. Again, this performance was due to sales of sandals,
70% Off 2014 Cheap Nike Air Yeezy Red October With Superior Quality, which made up 36% of the sales in the second quarter of 2007. Importantly, we continue to see that our merchandise and core strategies are resonating with consumers. This was evidenced by the improvement in several important sales metrics in the second quarter. We converted a higher percentage of customers with more units per transaction and at a higher average retail. This encourages us that our merchandising strategies are positioning Payless to continue to build market share.
So, now I would now like to update you on some of our more important initiatives and achievements, which I believe will provide additional confidence that we are well positioned to capitalize on growing market segments in both the short and long term. Lets go through each of the four cornerstones of the Payless strategy, starting first with on trend, targeted product.
Adohr Milk Cream is a US-based company famous for its gorgeous cows with their glamorous digs! Raised near Hollywood, CA…the movie capital of the World…our beautiful bovine are pampered like the stars they are. Our philosophy is “Star-quality cows make star-quality milk?. Our premier line of milk powder baby formulas are nutritionally complete for your rising star.
In the tradition of Old Hollywood, our wholesome, nutritious and delicious newborn, infant and toddler formulas start with milk from A-List cows. The cast of nutritionists and scientists at Adohr Milk Cream have spent years researching and developing the best combination of ingredients to provide optimal nutrition.
At Adohr Milk Cream, we believe your child is the star of your life…from pregnancy through toddlerhood and beyond. Our milk powders provide 100% of the recommended daily supply of vitamins and minerals that are essential for strong teeth and bones, good skin and hair, and a healthy brain. Everything a little star needs to grow.
Since our company was founded, every product we manufacture is done so with traditional values in mind. Our old-fashioned milk powders are made in America and are FDA-approved following strict guidelines and manufacturing processes.