Neiman Marcus 2012 Annual Report Download - page 8

Table of Contents
caters to a younger customer focused on contemporary fashion. Online generated 22.2% of our total revenues in fiscal year 2013, 20.2% of our total revenues
in fiscal year 2012 and 18.9% of our total revenues in fiscal year 2011.
We regularly send e-mails to approximately 6.4 million e-mail addresses, alerting our customers to our newest merchandise and the latest fashion
trends. In addition to our activities in the United States, in 2012 we launched international shipping to over 100 countries. For certain vendors, we operate their
online commercial operations and fulfill customer demand from the vendors’ website from either our owned inventory or inventory consigned from the
vendors.
We also conduct catalog sales through the Neiman Marcus and Horchow brands. Over 1.4 million customers made a purchase through one of our
websites or catalogs in fiscal year 2013. Our catalog business circulated approximately 40 million catalogs in fiscal year 2013, a decrease of approximately
9.0% from the prior year. With the growth of internet revenues, we have reduced catalog circulation in recent years and would expect flat to declining catalog
circulation in the foreseeable future.
For more information about our reportable segments, see Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of
Operations” and Note 17 of the Notes to Consolidated Financial Statements in Item 15.
Investment in Foreign E-commerce Retailer. In the third quarter of fiscal year 2012, we made a $29.4 million strategic investment in Glamour
Sales Holding Limited, a privately held e-commerce company based in Hong Kong with leading off-price flash sales websites in Asia. In February 2013, we
made an additional $10.0 million investment in Glamour Sales increasing our ownership interest to 44%. In the second quarter of fiscal year 2013, Glamour
Sales expanded its operations to launch a full-price, Mandarin language e-commerce website in China under the Neiman Marcus brand. Currently, the China
Neiman Marcus website offers in-season merchandise and we fulfill these orders from our distribution facility in China. During the fourth quarter of fiscal
year 2013, we began the transition of the China Neiman Marcus website from Glamour Sales to our Online operation in the United States. In fiscal year 2014,
we intend to fulfill orders from customers in China directly from the United States.
Other. Our fiscal year ends on the Saturday closest to July 31. Like many other retailers, we follow a 4-5-4 reporting calendar, which means that
each fiscal quarter consists of thirteen weeks divided into periods of four weeks, five weeks and four weeks. This resulted in an extra week in fiscal year
2013 (the 53 week). All references to fiscal year 2013 relate to the fifty-three weeks ended August 3, 2013, all references to fiscal year 2012 relate to the fifty-
two weeks ended July 28, 2012 and all references to fiscal year 2011 relate to the fifty-two weeks ended July 30, 2011. References to fiscal year 2014 and
years thereafter relate to our fiscal years for such periods.
We make our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and related amendments, available
free of charge through our website at www.neimanmarcusgroup.com as soon as reasonably practicable after we electronically file such material with (or furnish
such material to) the Securities and Exchange Commission (SEC). The information contained on our website is not incorporated by reference into this Annual
Report on Form 10-K and should not be considered to be part of this Annual Report on Form 10-K.
The Acquisition
On April 22, 2005, Neiman Marcus Group LTD Inc. (the Company), formerly Neiman Marcus, Inc. (formerly Newton Acquisition, Inc.), and its
wholly-owned subsidiary, Newton Acquisition Merger Sub, Inc. (Merger Sub), were formed and incorporated in the state of Delaware. Newton Holding, LLC
(Holding), the Company and Merger Sub were formed by investment funds affiliated with TPG Global, LLC (together with its affiliates, TPG) and Warburg
Pincus LLC (collectively, the Principal Stockholders) for the purpose of acquiring The Neiman Marcus Group, Inc. (NMG).
The acquisition of NMG was completed on October 6, 2005 (the Acquisition Date) through the merger of Merger Sub with and into NMG, with
NMG being the surviving entity (the Acquisition). Subsequent to the Acquisition, NMG is a subsidiary of the Company, which is controlled by Holding. In
connection with the Acquisition, NMG incurred significant indebtedness and became highly leveraged. We were previously named “Neiman Marcus, Inc.”
but were renamed “Neiman Marcus Group LTD Inc.” on August 28, 2013. See Item 7, “Management’s Discussion and Analysis of Financial Condition and
Results of Operations—Liquidity and Capital Resources.” All references to “we” and “our” relate to the Company for periods subsequent to the Acquisition
and to NMG for periods prior to the Acquisition.
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