RAPPORT ANNUEL 2007 - Le Ch£¢teau rapport annuel 2007 annual report 2007 rapport annuel 2007 annual

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  • RAPPORT ANNUEL 2007 ANNUAL REPORT 2007

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  • STORES AND SQUARE FOOTAGE JANUARY 26, 2008 JANUARY 27, 2007

    STORES SQUARE STORES SQUARE FOOTAGE FOOTAGE

    ONTARIO 69 330,986 61 261,616 QUEBEC 62 296,280 61 288,923 BRITISH COLUMBIA 24 109,308 24 101,222 ALBERTA 24 102,055 20 89,466 MANITOBA 7 34,254 7 30,351 NOVA SCOTIA 7 26,428 6 19,898 NEW BRUNSWICK 5 19,292 4 14,092 SASKATCHEWAN 4 16,200 4 14,803 NEWFOUNDLAND 2 9,203 2 9,203 P.E.I. 1 3,480 1 3,480

    TOTAL CANADA 205 947,486 190 833,054 TOTAL UNITED STATES 4 17,591 5 20,713

    TOTAL LE CHÂTEAU STORES 209 965,077 195 853,767

    CORPORATE PROFILE

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    SALES (in ‘000)

    NET EARNINGS (in ‘000)

    SHAREHOLDERS’ EQUITY (in ‘000)

    CASH FLOW FROM OPERATIONS (in ‘000)

    Le Château is a leading Canadian

    specialty retailer offering fashion-

    forward apparel, accessories and

    footwear to style-conscious women

    and men. Our brand’s success is built

    on quick identification of and

    response to fashion trends through

    our design, product development and

    vertically integrated operations.

    Le Château brand name merchan dise

    is sold exclusively through our 209

    retail locations. All stores are in

    Canada, except for four locations in

    the New York City area.

    Le Château, committed to research,

    design and product development,

    manufactures approximately 40% of

    the Company’s apparel in its own

    Canadian production facilities. MAGASINS ET SUPERFICIE EN PIEDS CARRÉS 26 JANVIER 200827 JANVIER 2007

    MAGASINSPIEDSMAGASINSPIEDS CARRÉSCARRÉS

    ONTARIO69330 98661261 616 QUÉBEC62296 28061288 923 COLOMBIE-BRITANNIQUE24109 30824101 222 ALBERTA24102 0552089 466 MANITOBA734 254730 351 NOUVELLE-ÉCOSSE726 428619 898 NOUVEAU-BRUNSWICK519 292414 092 SASKATCHEWAN416 200414 803 TERRE-NEUVE29 20329 203 ÎLE-DU-PRINCE-ÉDOUARD13 48013 480

    TOTAL CANADA205947 486190833 054 TOTAL ÉTATS-UNIS417 591520 713

    TOTAL MAGASINS LE CHÂTEAU209965 077195853 767

    PROFIL

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    CHIFFRE D’AFFAIRES (en ‘000)

    BÉNÉFICE NET (en ‘000)

    CAPITAUX PROPRES (en ‘000)

    FLUX DE TRÉSORERIE D’EXPLOITATION (en ‘000)

    Chef de file au Canada, Le Château

    est un détaillant spécialisé offrant

    des vêtements, des chaussures et

    des accessoires avant-gardistes aux

    femmes et aux hommes soucieux de

    la mode. Le succès de notre marque

    repose sur notre capacité d’identifier

    rapidement les tendances de la mode

    et d’y réagir immédiatement grâce à

    nos forces en conception et en

    développement de produits, ainsi qu’à

    notre approche verticale.

    Les vêtements de marque Le Château

    sont vendus exclusivement par

    l’entremise des 209 magasins de détail

    de la Société. Tous ses magasins sont

    situés au Canada, à l’exception de

    quatre dans la région de New York.

    Le Château, qui accorde une grande

    importance à la recherche, à la

    conception et au développement de

    produits, fabrique environ 40 % de ses

    vêtements dans ses installations de

    production au Canada.

    13395 Covers Qx7:Layout 1 5/15/08 4:49 PM Page 2

  • 2007 annual report 1

    FINANCIAL HIGHLIGHTS

    January 26, January 27, January 28, January 29, January 31, FISCAL YEARS ENDED 2008 2007 2006 2005 2004

    (53 weeks) RESULTS

    Sales 336,070 303,879 279,064 241,131 226,766 Earnings before income taxes 52,004 38,406 35,963 24,336 17,123 Net earnings 33,604 24,751 23,513 15,886 10,648 • Per share (basic) 1.35 1.02 0.99 0.74 0.52 Dividends per share • Ordinary 0.50 0.28 0.20 0.16 0.10 • Special — 0.75 — — — Average number of shares outstanding (000) 24,978 24,181 23,812 21,448 20,536

    FINANCIAL POSITION

    Working capital 72,414 45,928 60,491 47,781 24,987 Shareholders’ equity 131,635 108,174 105,245 85,244 61,162 Total assets 203,979 185,709 166,236 128,198 94,546

    FINANCIAL RATIOS

    Current ratio 2.54 1.75 2.52:1 2.61:1 1.99:1 Quick ratio 1.62 1.08 1.63:1 1.62:1 0.96:1 Long-term debt to equity (1) 0.17:1 0.14:1 0.20:1 0.16:1 0.11:1

    OTHER STATISTICS (units as specified)

    Cash flow from operations (in ‘000) 51,606 40,374 36,311 25,291 18,311 Capital expenditures (in ‘000) 24,091 27,701 27,655 16,491 14,438 Number of stores at year-end 209 195 185 174 165 Square footage 965,077 853,767 762,093 686,830 645,362 Sales per square foot (2) 408 407 416 394 386

    (in thousands of dollars except per share data and ratios)

    Ticker symbol: CTU.A

    Listing: TSX

    Number of participating shares outstanding (as of May 8, 2008):

    18,502,964 Class A Subordinate Voting Shares

    6,560,000 Class B Voting Shares

    Float: (3)

    15,726,684 Class A Shares held by the public

    SHAREHOLDERS’ INFORMATION As of May 8, 2008:

    High/low of Class A Shares (12 months ended May 8, 2008): $17.87 / $11.05

    Recent price: $13.29 Dividend yield: 3.8% Price/earnings ratio: 9.8 X Price/book value ratio: 2.5 X

    Earnings per share: (4) $1.35

    Book value per share: (5) $5.25

    (1) Including capital leases and current portion of debt. Excluding deferred lease inducements.

    (2) Excluding Le Château outlet stores.

    (3) Excluding shares held by officers and directors of the Company. (4) For the year ended January 26, 2008. (5) As at January 26, 2008.

    13395 LeChateau ENG 5/12/08 5:11 PM Page 1

  • 2 le château

    MESSAGE TO SHAREHOLDERS

    I am delighted to report another year of record sales and profits. Our dedicated team remained true to Le Château’s

    brand promise of unique fashion collections at sensible prices.

    Despite a challenging retail environment, our earnings increased 36% from $24.7 million to $33.6 million and our

    annual dividend rate increased from $0.375 to $0.50 per share plus a special one-time dividend of $0.75.

    In 2008, the current economic conditions produce a hesitant consumer in the marketplace. It is therefore

    important for us to remember our core strengths of design and product development that generate wanted

    fashion collections.

    We remain focused on continuing to improve our inventory management controls, which combined with

    vertically-integrated operations, provide the flexibility and speed-to-market needed in today’s environment.

    In 2007, the Company opened 18 stores and intends to open 12 to 15 new stores in the current year. In the first

    quarter of 2008 we have achieved our previous set goal of 1,000,000 square feet of total floor space and we

    continue to expand our target customer base. Our four divisions of ladieswear, menswear, accessories and

    footwear continue to expand, with menswear showing the strongest increase of 13% last year.

    We would again like to thank all our team members in every department of the Company, for their talent,

    commitment and contribution to our ongoing success. Thank you as well to our shareholders and our

    devoted customers.

    (Signed)

    JANE SILVERSTONE SEGAL, B.A.LLL

    Vice-Chairman and Chief Executive Officer

    13395 LeChateau ENG 5/12/08 5:12 PM Page 2

  • 2007 annual report 3

    MANAGEMENT’S DISCUSSION AND ANALYSIS April 25, 2008 The 2007, 2006 and 2005 years refer, in all cases, to the 52 week periods ended January 26, 2008, January 27, 2007 and January 28, 2006, respectively. Management’s Discussion and Analysis (“MD&A”) should be read in conjunction with the audited consolidated financial statements and notes to the consolidated financial statements for the 2007 fiscal year of Le Château Inc. All amounts in this report are expressed in Canadian dollars and all amounts in the tables of this report are in thousands of Canadian dollars, unless otherwise indicated.

    SELECTED ANNUAL INFORMATION (IN THOUSANDS OF DOLLARS EXCEPT PER SHARE AMOUNTS)

    2007 2006 2005 $ $ $

    Sales 336,070 303,879 279,064 Earnings before income taxes 52,004 38,406 35,963 Net earnings 33,604 24,751 23,513 Net earnings per share

    Basic 1.35 1.02 0.99 Diluted 1.33 1.00 0.96

    Total assets 203,979 185,709 166,236 Long term debt (1) 13,697 8,222 14,665 Dividends per share

    Ordinary 0.50 0.28 0.20 Special — 0.75 —

    Cash flow from operations 51,606 40,374 36,311 Comparable store sa