Original Source: FD (FAIR DISCLOSURE) WIRE
OPERATOR: Good morning, ladies and gentlemen, and welcome to the Christopher & Banks Corporation management conference call. At this time, all participants have been placed on a listen-only mode and the floor will be open for questions following the presentation. It is now my pleasure to turn the floor over to your host, Cara O'Brien. Cara you may begin.
CARA O'BRIEN, INVESTOR RELATIONS, CHRISTOPHER & BANKS: Thank you operator. Good morning everyone. And thank you for joining us to discuss Christopher & Banks recently announced acquisition. Before we begin, I would like to remind you that some of the comments made on this conference call, as either prepared remarks or in response to your questions, may contain forward-looking statements that are made pursuant to the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. Such information is subject to risk and uncertainties that could cause actual results to materially differ from such statements as described in the press release and in Christopher & Banks' most recent annual report on form 10-K filed with the SEC. And we direct all listeners that report. The information contained in this conference call is accurate only as of the date discussed. Investors should not assume that the statements made in this call remain operative at a later time. Finally, Christopher & Banks undertakes no obligation to update any information discussed in this call. Now I would like to turn the call over to Joe Pennington, President of Christopher & Banks. Joe, please go ahead.
JOE PENNINGTON, PRES, COO, DIRECTOR, CHRISTOPHER & BANKS: Thank you, Cara. Good morning, everybody. And thanks for joining us today. Andy Moller, our CFO, is with me this morning. Bill is traveling and is not able to join us on the conference call today. Let me first say that we're very excited about the pending transaction and we believe that it's an excellent fit for the Christopher & Banks business. This represents for us a tremendous opportunity for the diversification of our business model, and will certainly aid in our long-term growth strategy. The 2 organizations are well matched and we expect that the acquisition will transition smoothly. Both cater to female baby boomer customers, although to different segments of that market, with many common characteristics. We run our stores in a similar fashion with a focus on quality, on ease of shopping and both are focused on delivering great customer service. Acorn, however, is a unique and differentiated retail concept. Acorn's Sally is a different customer than our Mary.
In short, Acorn provides Christopher & Banks with a great low risk strategy to diversify our business. Acorn can serve as that third retail concept we've been searching for, targeting a new and different customer segment. More specifically, Acorn will diversify our business by providing us business to the more affluent baby boomer shopper. This shopper who will accept higher price points and has more upscale tastes is an important segment of the apparel market and Acorn's affluent households are impacted differently by the economy. For example, this household group does not feel some of the same weaknesses as strongly as as our core customers of Christopher & Banks and C.J. Banks.
Before we get into the detail of the transaction, as well as talking a little bit about some of the opportunities we see for the Acorn chain under the Christopher & Banks umbrella, I would like to first provide you with a little background on the Acorn business for those of you who are not familiar with them. Privately held Gilmore Brothers operates 20 stores in 9 states under the name Acorn. The stores are located primarily in the Midwest and in the Southeast. With stores currently in Ohio, Illinois, Indiana, Michigan, Kentucky, North and South Carolina, Georgia and Virginia. The Company's headquarters and distribution facility are in Kalamazoo, Michigan.
Christopher & Banks, either with Christopher & Banks itself or with C.J. Banks, has stores in all of the states where Acorn currently operates. However, there's little overlap between the stores. The Acorn stores have a boutique feel and are primarily located in life-style centers and other distinctive shopping areas. Which is different from the primarily mall based Christopher & Banks and C.J. Banks locations. Typically Acorn stores are about 2400 square feet and generate approximately $600,000 in sales. The stores sell high quality women's fashion apparel and complimentary jewelry and other accessories. As we mentioned in the release, Acorn's target customer is Sally, a baby boomer who is more affluent and has a more upscale fashion taste than Mary or Tracy, our target customers at Christopher & Banks and C.J. Banks. The clothes for Sally are well constructed, colorful pieces with an attention to detail that's designed to appeal to the woman who leads an active life style, balancing family, work and community activities. The merchandise is designed to be versatile, enabling the Acorn customer to cross seasons and daily activities with ease. Approximately 60% of Acorn's merchandise is private label. Accessories include handbags, jewelry and other accessories and account for approximately 25- - or 20% of the merchandise mix.
Acorn carries both private label as well as other branded labels in their merchandise mix. The atmosphere of the Acorn stores is comfortable and inviting. The chain prides itself on the excellent customer service that it gives. Acorn also offers a Popular Awards Program, where customers receive an ongoing 5% discount once they have achieved $500 in purchases. This program is served to not only build a loyal and enthusiastic base for Acorn, but has allowed …