Express 2014 Annual Report Download - page 69

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In addition, as of February 1, 2014, the Company accrued $0.8 million of contributions related to 2013 that were
credited to employee accounts in 2014. These amounts along with the above-mentioned amounts of $27.3 million
and $25.8 million for the period ended January 31, 2015 and February 1, 2014, total $27.3 million and $26.6
million, respectively, and are included in other long-term liabilities on the Consolidated Balance Sheets.
13. Commitments and Contingencies
During 2013 and 2014, the Company received letters from two individuals claiming that the Company
unlawfully collected their zip codes in connection with a retail purchase made at a Massachusetts Express store
and thereafter used that information to send them unwanted marketing materials. These letters indicate that the
individuals may file suit on behalf of a class of customers whose zip codes were collected and recorded at
Company stores in Massachusetts in connection with credit card purchases, and claims that the Company used
the collected zip code data to obtain customers’ addresses for purposes of mailing them unwanted advertising
material. These letters further seek monetary damages pursuant to a claim under Chapter 93A of the General
Laws of Massachusetts. In the first quarter of 2014, after providing the claimants with information about the
Company’s collection practices, the Company received notice that one of the claimants will not pursue the claims
previously alleged against the Company. The other claimant has not had any further communications with the
Company and has not filed a claim against the Company. The Company believes the allegations in the letters are
without merit and intends to vigorously defend itself against any claims that are filed in court. Due to the
uncertainties of litigation, it is reasonably possible that the Company may incur a loss related to these claims.
However, the amount of such loss, if any, cannot be estimated as of the date these financial statements are issued.
From time to time the Company is subject to other various claims and contingencies arising out of the normal
course of business. Management believes that the ultimate liability arising from such claims and contingencies, if
any, is not likely to have a material adverse effect on the Company’s results of operations, financial condition, or
cash flows.
14. Quarterly Financial Data (Unaudited)
Summarized unaudited quarterly financial results for 2014 and 2013 follows:
2014 Quarter First Second Third Fourth
(in thousands, except per share amounts)
Net sales ............................................. $460,652 $481,420 $497,608 $725,801
Gross profit ........................................... $137,373 $136,025 $157,558 $229,998
Net income ........................................... $ 5,083 $ 6,867 $ 14,585 $ 41,790
Earnings per basic share ................................. $ 0.06 $ 0.08 $ 0.17 $ 0.50
Earnings per diluted share ................................ $ 0.06 $ 0.08 $ 0.17 $ 0.49
2013 Quarter First Second Third Fourth
(in thousands, except per share amounts)
Net sales ............................................. $509,362 $490,075 $503,808 $715,880
Gross profit ........................................... $170,777 $152,547 $165,265 $229,118
Net income ........................................... $ 32,437 $ 16,909 $ 19,267 $ 47,926
Earnings per basic share ................................. $ 0.38 $ 0.20 $ 0.23 $ 0.57
Earnings per diluted share ................................ $ 0.38 $ 0.20 $ 0.23 $ 0.57
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