Express 2014 Annual Report Download - page 8

PART I
ITEM 1. BUSINESS.
In this section, “Express”,“we”, “us”, “the Company”, and “our” refer to Express, Inc. together with its
predecessors and its consolidated subsidiaries as a combined entity. Our fiscal year ends on the Saturday closest
to January 31. Fiscal years are referred to by the calendar year in which the fiscal year commences. All
references herein to “2014”, “2013”, and “2012” refer to the 52-week period ended January 31, 2015, the 52-
week period ended February 1, 2014, and the 53-week period ended February 2, 2013, respectively.
General
Express is a specialty apparel and accessories retailer offering both women’s and men’s merchandise. We have
over 30 years of experience offering a distinct combination of style and quality at an attractive value, targeting
women and men between 20 and 30 years old. We offer our customers an assortment of fashionable apparel and
accessories to address fashion needs across multiple aspects of their lifestyles, including work, casual, jeanswear,
and going-out occasions.
We opened our first store in Chicago, Illinois in 1980 as a division of L Brands, Inc. (formerly known as Limited
Brands, Inc.) (“L Brands”). In 2007, investment funds managed by Golden Gate Private Equity, Inc. (“Golden
Gate”) acquired a controlling interest in the Express division from L Brands. In May 2010, Express, Inc., the
parent company of subsidiaries that operate our business, was converted into a Delaware corporation and
completed an initial public offering (“IPO”), including listing its common stock on the New York Stock
Exchange. In this Annual Report on Form 10-K, we refer to all of the events that occurred in connection with the
IPO as the “Reorganization”.
As of January 31, 2015, we operated 641 stores across the United States, in Canada, and in Puerto Rico,
including 41 factory outlet stores. Our stores are located primarily in high-traffic shopping malls, lifestyle
centers, outlet centers, and street locations, and average approximately 8,800 gross square feet. We also sell our
products through our e-commerce website, www.express.com, and have franchise agreements with franchisees
who operate Express locations in Latin America, the Middle East, and South Africa. Our 2014 merchandise sales
were comprised of approximately 62% women’s merchandise and approximately 38% men’s merchandise.
We report one segment, which includes the operation of our brick-and-mortar retail and outlet stores, e-
commerce operations, and franchise operations. Additional information about our reportable segment can be
found in Note 2 of our Consolidated Financial Statements.
Competitive Strengths
We believe that our primary competitive strengths are as follows:
Established Lifestyle Brand. With over 30 years of heritage, the Express brand represents a distinctive point
of view that is confident, sexy, and vibrant.We believe that our customers view Express as a fashion
authority and look to us to provide them with the latest fashions that meet their multifaceted lifestyles and
allow them to express their individual style. The Express brand differentiates itself by offering (1) a
balanced assortment of core styles and the latest fashions; (2) products that address fashion needs across
multiple wearing occasions, including work, casual, jeanswear, and going-out; and (3) quality products at an
attractive value.
Attractive Market and Customer Demographic. We are part of the specialty apparel market targeting 20 to
30 year old women and men. We believe the specialty apparel market is a significant piece of the total
apparel market for this demographic and that the Express brand appeals to a particularly attractive subset of
this group, who we believe spend a higher percentage of their budget on fashion compared to the broader
population.
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