Christopher

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Christopher Bank Corp.

• By Eric Resetar

2
Company Overview

• Christopher Banks Corporation is a retail
  company that provides specialty apparel. For the
  fiscal year ended February 2004, the company
  reported revenues of 390 million.
• As of April 30, 2004, the Company operated 556
  stores in 42 states including 426 Christopher
  Banks stores and 130 C.J. Banks stores.
• Christopher Banks is headquartered in Plymouth,
  Minnesota.

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Company History

• The company began in 1956 when founder Gil Braun
  opened the first Braun store in Minneapolis. The
  company was called Braun Fashions, and
  immediately set about opening more stores and
  diversifying its range of products.
• The company launched its initial public offering,
  (IPO) in 1992.
• In 2000, it identified over-sized clothing as the
  fastest growing sector of the apparel market, and
  launched its C.J. Banks division specifically to
  cater for women of size 14 and above.
• In July 2000, the company changed its name from
  Braun Fashion to its current name, Christopher
  Banks Corporation, and expected to complete
  rebranding its stores by the end of 2003.

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Business Strategy

• The Companys business strategy is to provide its
  target customer with high quality,
  moderately-priced, coordinated ensembles that are
  interchangeable between work and leisure
  activities to differentiate itself from its
  competitors through its focused merchandising
  approach, including an emphasis on private brand
  merchandise designed and manufactured exclusively
  for the Company under its proprietary names,
  Christopher Banks and C.J. Banks to utilize
  information systems to effectively manage its
  merchandise inventories and to expand its store
  base and maintain updated, attractive store
  locations.

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Key elements of Strategy

• The key elements of the Companys strategy are as
  follows
• Focus on a target customer and meet her needs
• Deliver a well defined merchandise assortment
• Use information systems to drive decision making
  and maintain disciplined inventory management
• Expand store base in existing and new markets
• Grow through development of new concepts

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Products Customers

• The Christopher Banks stores offer distinctive
  fashions featuring exclusively designed
  assortments of sportswear, sweaters and casual
  dresses sizes 4 to 16.
• The C.J. Banks stores offer similar assortments
  of womens specialty apparel in sizes 14W and up.
• The Company's target customer is a 40- to
  60-year-old working woman with an annual family
  income of 50,000 and above. Management believes
  this target customer leads a busy life, shops in
  regional malls and purchases fashions which are
  suitable for both work and leisure activities.
• Christopher Banks differentiates itself from
  other women's specialty apparel retailers through
  offering a merchandise assortment that is
  characterized by novelty designs, many featuring
  seasonal themes.

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Recent Events

• The Company's Board of Directors approved stock
  repurchases of up to 40 million.
• Christopher Banks Corporation announced that it
  has signed an agreement to purchase all of the
  assets of Gilmore Brothers, Inc., a privately
  held women's specialty retailer operating 20
  stores in nine states under the name Acorn.
• The total purchase price for the assets of
  Kalamazoo, Michigan-based Gilmore Brothers, Inc.
  will be approximately 7 million.
• Insider sales are up to 254.6 compared to 37.4
  one year ago.
• Stock Splits15-Dec-99 32, 12-Jul-00 32,
  13-Feb-01 32, 13-Dec-0132, 28-Aug-03 32

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Top Competitors

• Intimate Brands, Inc.
• Liz Claiborne, Inc.
• Saks Incorporated
• Limited Brands
• AnnTaylor Stores Corporation
• Charming Shoppes, Inc.
• Chicos FAS, Inc.
• Deb Shops, Inc.
• The Dress Barn, Inc.

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CBK vs. Competitors
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Swot Analysis

• Strengths
• Strong Visual Merchandise Presentation (Use of
  front of store displays )
• New color pallete every 10-12 weeks
• Upgrading customer service (tissue, hangers)
• Plus size specialty lines
• Direct Import Program(96 of merchandise)

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SWOT contd

• Weaknesses
• The Company begins the design process for its
  apparel six to seven months before merchandise is
  available to its customers. These lead times
  make it difficult for the Company to respond
  quickly to changing consumer preferences.
• Competitors are significantly larger and have
  substantially greater financial, marketing and
  other resources and enjoy greater national,
  regional and local name recognition than they do.

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SWOT contd

• Opportunities
• Plus size specialty lines
• Acquisition of all the assets of Gilmore
  Brothers, Inc.
• The Companys continued growth depends on its
  ability to open and operate stores successfully
  and to manage the Companys planned expansion.
• Threats
• The retail apparel industry is highly
  competitive.
• The Companys successful performance in recent
  years has increased the amount of imitation by
  other retailers. Such imitation has made and will
  continue to make the retail environment in which
  the Company operates more competitive.

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Recommendation

• HOLD
• Good financials
• Solid company
• Want to work with IV a little more.
• Want to look into management more.