MYR Mayors Jewelers

Mayor's Jewelers, Inc. (the "Company" or "Mayor's") (AMEX:MYR), which operates 28 luxury jewelry stores in Florida and Georgia, reported results for its first fiscal quarter ended June 25, 2005, which were notably improved in comparison to the previous year's first fiscal quarter results. Net sales increased 11.7% to $32.5 million for the first fiscal quarter, which included the thirteen weeks ended June 25, 2005, compared to $29.1 million for the prior year's first fiscal quarter, which included the thirteen weeks ended June 26, 2004. Comparable store sales for this year's first fiscal quarter increased 11.5% from last year's first fiscal quarter. The increase in comparable store sales was primarily driven by an increase in the Company's average sale, an increase in high-end sales, and strong results from annual marketing initiatives such as the spring catalog. Gross profit for the current first fiscal quarter was $14.4 million or 44.3% of net sales, compared to $12.2 million or 41.7% of net sales during the prior year's first fiscal quarter. The increase in gross margin (gross profit as a percentage of net sales) was due in substantial part to the successful execution of merchandising and retail strategies. Net loss for the current first fiscal quarter decreased 72.1% to ($689,000) as compared to a net loss of approximately ($2.5) million for the first fiscal quarter of the previous year. Loss per share for the first fiscal quarter of the current year was ($0.03) as compared to ($0.07) in the first fiscal quarter of the prior year. Commenting on the results, Thomas A. Andruskevich, Chairman, President and Chief Executive Officer of the Company, said, "We are extremely pleased with the Company's performance for the first fiscal quarter. Mayor's momentum continues to be strong and these tangible results demonstrate the successful execution of our key strategies, including effective merchandising, marketing and retail initiatives, as well as the optimization of organizational synergies and business processes. We are optimistic about the state of our business based on these results and will continue to pursue strategic programs that will further strengthen our brand and our financial results." Mayor's is a leading luxury retail jeweler serving Florida and Greater Atlanta. The Company was founded in 1910 and has maintained the intimacy of a family-owned boutique while becoming renowned for its fine jewelry, timepieces and giftware. Additional information can be found on Mayor's Web site, http://www.mayors.com. This press release contains certain "forward-looking" statements concerning expectations for sales, margins and earnings (loss), financing needs or plans, success of the Company's merchandising, marketing and retail initiatives, and continued growth. Actual results might differ materially from those projected in the forward-looking statements based on risk factors, including the success of the Company's marketing initiatives, the Company's ability to have a successful customer service program, the successful resolution of the informal investigation by the Securities and Exchange Commission previously disclosed by the Company, the successful completion of the proposed transaction between the Company and Henry Birks & Sons Inc., the Company's controlling stockholder, the Company's ability to attract and retain its key personnel and the Company's ability to increase sales and keep costs low. Information concerning factors that could cause actual results to differ materially are set forth in Mayor's 2004 Annual Report and in Form 10-K, 10-K/A, 10-Q, 10-Q/A and 8-K Reports filed with the Securities and Exchange Commission. The Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events or circumstances. -0- *T MAYOR'S JEWELERS, INC. AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS - UNAUDITED (Amounts shown in thousands except share and per share data) June 25, March 26, 2005 2005 --------- --------- ASSETS Current Assets: Cash and cash equivalents $1,436 $1,220 Accounts receivable (net of allowance for doubtful accounts of $878 and $962, at June 25, 2005 and March 26, 2005, respectively) 5,587 6,936 Inventories 84,120 80,439 Other current assets 596 632 --------- --------- Total current assets 91,739 89,227 --------- --------- Property, net 12,813 13,143 Other assets 234 416 --------- --------- Total non-current assets 13,047 13,559 --------- --------- Total assets $104,786 $102,786 ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable $18,201 $13,139 Accrued expenses 5,183 6,786 Credit facility 34,151 33,501 --------- --------- Total current liabilities 57,535 53,426 --------- --------- Term loan 11,668 12,668 Other long term liabilities 2,507 2,401 --------- --------- Total long term liabilities 14,175 15,069 --------- --------- Stockholders' Equity: Series A-1 convertible preferred stock, $.001 par value, 15,050 shares authorized, issued and outstanding at June 25, 2005 and March 26, 2005, liquidation value of $15,050,000 -- -- Common stock, $.0001 par value, 50,000,000 shares authorized, 46,975,546 issued at June 25, 2005 and March 26, 2005 5 5 Additional paid-in capital 206,574 207,100 Accumulated deficit (144,103) (143,414) Less: 9,983,954 shares of treasury stock, at cost (29,400) (29,400) --------- --------- Total stockholders' equity 33,076 34,291 --------- --------- Total liabilities and stockholders' equity $104,786 $102,786 ========= ========= *T -0- *T MAYOR'S JEWELERS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED (Amounts shown in thousands except share and per share data) Thirteen Thirteen Weeks Ended Weeks Ended June 25, June 26, 2005 2004 ------------ ----------- Net sales $32,543 $29,138 Cost of sales 18,130 16,985 ----------- ----------- Gross profit 14,413 12,153 ----------- ----------- Selling, general and administrative 13,306 12,680 Other charges (credit) (79) -- Depreciation and amortization 784 833 ----------- ----------- Total operating expenses 14,011 13,513 ----------- ----------- Operating income (loss) 402 (1,360) Interest and other income -- 3 Interest and other financial costs (1,091) (1,115) ----------- ----------- Loss from operations before income taxes (689) (2,472) Income tax -- -- ----------- ----------- Net loss (689) (2,472) Preferred stock cumulative dividend (301) -- ----------- ----------- Net loss attributable to common stockholders $(990) $(2,472) =========== =========== Weighted average shares outstanding, basic and diluted 36,991,592 36,961,307 Loss per share, basic and diluted $(0.03) $(0.07) =========== =========== *T