Charming Shoppes posts $316 million of total liquidity at Aug. 1

By Jennifer Lanning Drey

Portland, Ore., Aug. 26 - Charming Shoppes Inc. ended the second quarter with total liquidity of $316 million at Aug. 1, which included $117 million of cash and net availability of $199 million on its line of credit, Eric Specter, chief financial officer of Charming Shoppes, said Wednesday during the company's quarterly earnings conference call.

The company expects its cash position to increase by another $110 million upon the closing of its previously announced proposed sale of its credit card receivables program to Alliance Data Systems Corp., he said.

The transaction is expected to close by the end of the year and will eliminate further financing obligations with respect to the credit card program for Charming Shoppes, Specter said.

During the second quarter, Charming Shoppes used cash to repurchase $38.2 million face value of its convertible notes for $21 million, bringing the company's total year-to-date repurchases to $51.7 million face value, Specter said.

For the second quarter, Charming Shoppes posted a net sales decrease of $121.4 million, reflecting a 14% decrease in comparable-store sales and the impact of net store closings. Income from operations was $10.3 million, excluding restructuring charges, compared to income from operations of $9.8 million, absent restructuring charges, in the prior-year period.

Specter said the company's Lane Bryant Stores and Catherines Stores showed year-over-year improvement, while the results at the Fashion Bug Stores were below the 2008 performance.

As previously reported, following the close of the second quarter, Charming Shoppes closed on a new $225 million three-year secured revolving credit facility that provides committed funding through July 2012.

"We are pleased to have proactively and successfully addressed the maturity of our previous credit facility," Specter said.

Charming Shoppes is a Bensalem, Pa.-based multi-brand apparel retailer specializing in women's plus apparel.

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