Christopher & Banks Corp · OTC:CBKCQ
Christopher & Banks — Investor Presentation (April 2014)
27 slides from Christopher & Banks's investor presentation, Apr 7, 2014
Slide 1: Charting Our Path to Growth and Long-Term Profitability
Charting Our Path to Growth and Long-Term Profitability April, 2014
Slide 2: Safe Harbor
Certain statements on the slides which follow may be forward-looking statements about Christopher & Banks Corporation (the “Company”). Such forward-looking statements involve risks and uncertainties which may cause actual results to differ. These forward-looking statements may be identified by such
Slide 3: Our Vision & Mission
Our Vision & Mission Vision: To be her trusted brand by delivering style and value every day. Mission: To provide women of all sizes with apparel and accessories with style and versatility that reflects who she is, lasting quality and the affordable value she expects, delivered with the personalized
Slide 4: Company Overview
4 An established brand targeting the 45-60 age group with fashionable assortments that meet our customers’ needs for style, versatility and value 547 stores in two primary brand concepts: 319 Christopher & Banks stores – missy & petite – average size of 3,300 square feet 127 CJ Banks stores
Slide 5: Our Core Customer
Target women 45-60 years Avg. household income $70k-$75k More than 50% higher than US avg. 70% work outside of the home Two-thirds married Purchases 3.4 times annually Self-reports that she visits more frequently Spends $157 annually On average, $46 per purchase 5 Our Core Customer
Slide 6: Experienced Management Team
Name Title Year Joined CBK Years in Industry LuAnn Via President and CEO 2012 30+ Peter Michielutti SVP and CFO 2012 20+ Michelle Rice SVP, Store Operations 2008 20+ Monica Dahl SVP, Marketing 2004 20+ Ann McDermott VP, Divisional Merchandise Manager 2011 20+ Tricia Perket VP, Divisional Merchandise
Slide 7: Improved Financial Performance
7 Improved Financial Performance Instituted merchandising and marketing strategies focused on sales and profitability over the last two years Comparable store sales in 4Q13 negatively impacted by severe weather Improved inventory flow and instituted a more disciplined markdown strategy Incre
Slide 8: Long-Range Financial Targets
Over the Next 3 Fiscal Years, Expect to Deliver Mid-Single- Digit Comp Growth 300-400 bps of Gross Margin Expansion SG&A Leverage 2% - 3% Annual Net Square Footage Growth High-Single-Digit Operating Margin by End of Fiscal 2016 8 Long-Range Financial Targets
Slide 9: Corporate Strategic Initiatives
Elements of Strategic Initiatives Focused Assortments and Merchandising Compelling Price/Value Equation Targeted Messaging and Marketing Engaged and Easy to Shop Store Experience Operational Excellence 9 Corporate Strategic Initiatives
Slide 10: Focused Merchandise Assortments
10 Consistently deliver a balanced, compelling and versatile fashion assortment Offer fashion-right, age-appropriate options Continue to maximize sales and margin with year round core basic programs and appropriate depth of key styles Increase wear-to-work options including jackets, blouses,
Slide 11: Focused Merchandise Assortments
Expand core programs of Everyday Denim and Layer Your Look knit tees Introduce new fit solutions and easy care fabrics Signature slimming pants Wrinkle-resistant shirts Introduce weekend wear Expand soft knit dressing Focused Merchandise Assortments 11
Slide 12: Compelling Price/Value Equation
12 Offer a price/value proposition that resonates with customers Provide attractive opening price points in all categories Drive key sales and margin at compelling price points Plan promotional buys to maximize margin Continue to offer a well-balanced good / better / best product mix Con
Slide 13: Targeted Messaging and Marketing
13 Leverage Customer Relationship Management (CRM) Programs Friendship Loyalty Program at 4 million in total and 2.2 million Active customers generating 97% of our 12-month sales as of February 1, 2014 Increase analytics around customer segments Continue to expand Private Label Credit Card P
Slide 14: Targeted Messaging and Marketing
14 Invest in marketing programs that increase customer growth and loyalty while driving measurable returns Continue investment in direct mail Increase investments in social media and select PR Support new store formats with enhanced grand opening events Refine promotional strategy Target
Slide 15: Enhanced Ecommerce Experience
Establishing direct foundation that keeps up with the changing needs of our customer Ongoing enhancements and updates to improve her shopping experience Leverage growing mobile usage among our target customer Increase our use of digital media to extend the reach of our brands and acquire a n
Slide 16: Engaged and Easy-to-Shop In-Store Experience
Refreshed “Selling with Care” program Refining selling techniques through additional videos and tools Reinforce clientelling as key to selling culture Increased selling hours at select stores Upgraded Talent Aligning store personnel capabilities with real estate strategy Enhanced on-bo
Slide 17: Real Estate Strategy
17 In Fiscal 2014 we plan on: Adding CJ product to 50 CB stores and converting them to the MPW format Closing 20 CB/CJ stores and converting them into 10 MPW stores in the existing space Closing 16 CB/CJ stores and relocating to 8 new MPW stores Closing 10 CB stores and replacing each with a
Slide 18: Map of Current Store Base
Map of Current Store Base Highly Midwest, Northeast concentrated store base with opportunity for geographic expansion 18
Slide 19: Investment Highlights
19 Unique customer niche largely underserved by others Multi-channel strategy with small market focus Strategic initiatives driving improved sales and merchandise margin performance Significant operating margin expansion opportunity Enhanced balance sheet with improved liquidity and flexib
Slide 20: Financial Highlights
christopher& banks Life. You wear it well Financial Highlights
Slide 21: Improved Financial Performance
Total comparable sales for fiscal 2013 were up 8.1% Improved conversion rates, higher units per transactions, and an increase in the AUR led to a 6.7% increase in average dollar sale Despite operating an average of 8.5% fewer stores, sales for fiscal 2013 grew 1.3% as compared to fiscal 2012
Slide 22: 3-Year Financial Highlights
52 Weeks Ended 53 Weeks Ended 52 Weeks Ended February 1, 2014** February 2, 2013** January 28, 2012** Net Sales $435.8 $430.3 $436.2 Gross Margin 34.7% 29.4% 23.6% SG&A as % of sales 29.6% 30.0% 32.5% Operating Income (Loss)* $8.9 ($16.0) ($82.1) Net Income (Loss)* $8.7 ($16.1) ($81.4) Adjusted Net
Slide 23: EBITDA Performance Since Turnaround Began
EBITDA Performance Since Turnaround Began Embarked on a turnaround in December 2011 and have since made significant changes across various functions This has led to a swift and dramatic improvement in EBITDA performance (37,231) (39,254) (22,620) (2,531) 11,009 16,330 19,656 22,184 (50,000) (40,
Slide 24: Balance Sheet and Cash Flow Summary
February 1, 2014 (In Millions) February 2, 2013 (In Millions) Cash and Investments $57.2 $40.7 Merchandise Inventories 44.9 42.7 Property and Equipment, net 36.5 41.2 Total Assets $149.0 $135.9 Long -Term Debt — — Stockholders’ Equity $86.9 $75.5 Balance Sheet and Cash Flow Summary No outstanding
Slide 25: Q1 Guidance Update
Q1 Guidance Update For the first quarter of fiscal 2014 the Company expects: Same-store sales to be relatively flat to last year. Gross margin improvement of 50 to 70 bps, as compared to last year’s first fiscal quarter driven by improved merchandise margins. SG&A dollars to be flat compared
Slide 26: FY 2014 Guidance Update
FY 2014 Guidance Update For the full year fiscal 2014 the Company expects: Capital expenditures to be $23 million to $25 million. To recognize a nominal amount of tax expense, as the Company’s tax provisions will continue to be affected by the valuation allowance on our deferred tax assets.
Slide 27: christopherx banks | cj banks
christopherx banks | cj banks Life. You wear it well: MISSY PETITE WOMEN 4-16 4P-16P 14W-24W
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