Mothers Work Inc.

United States
Securities and Exchange Commission

Washington, D.C. 20549

FORM 10-Q

x		Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2008

Or

o		Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

Commission file number 0-21196

MOTHERS WORK, INC.

(Exact name of registrant as specified in its charter)

Delaware		13-3045573
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

456 North 5th Street, Philadelphia, Pennsylvania		19123
(Address of principal executive offices)		(Zip code)

Registrant’s telephone number, including area code (215) 873-2200

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o		Accelerated filer x
Non-accelerated filer o (Do not check if a smaller reporting company)		Smaller reporting company o

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock, $.01 par value 6,069,381 shares outstanding as of May 1, 2008

MOTHERS WORK, INC. AND SUBSIDIARIES

INDEX

PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited)	3
	Consolidated Balance Sheets	3
	Consolidated Statements of Operations	4
	Consolidated Statements of Stockholders’ Equity and Comprehensive Income (Loss)	5
	Consolidated Statements of Cash Flows	6
	Notes to Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	12
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	21
Item 4.	Controls and Procedures	22

PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	23
Item 1A.	Risk Factors	23
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	23
Item 6.	Exhibits	23

Signatures		24

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

MOTHERS WORK, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

(unaudited)

	March 31, 2008			September 30, 2007
ASSETS
Current assets:
Cash and cash equivalents	$	7,774		$	10,130
Trade receivables, net	7,701			12,094
Inventories	100,177			100,485
Deferred income taxes	7,123			7,123
Prepaid expenses and other current assets	7,669			6,603
Total current assets	130,444			136,435
Property, plant and equipment, net	67,568			68,651
Assets held for sale	207			207
Other assets:
Goodwill	50,389			50,389
Deferred financing costs, net of accumulated amortization of $251 and $133	1,109			1,251
Other intangible assets, net of accumulated amortization of $2,291 and $2,478	590			576
Deferred income taxes	16,375			15,189
Other non-current assets	3,086			3,227
Total other assets	71,549			70,632
Total assets	$	269,768		$	275,925

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Line of credit borrowings	$	—		$	—
Current portion of long-term debt	1,225			1,534
Accounts payable	27,327			28,345
Accrued expenses and other current liabilities	37,575			41,633
Total current liabilities	66,127			71,512
Long-term debt	86,107			91,646
Deferred rent and other non-current liabilities	30,057			24,244
Total liabilities	182,291			187,402

Commitments and contingencies (Note 9)

Stockholders’ equity:
Preferred stock, 2,000,000 shares authorized
Series A cumulative convertible preferred stock, $.01 par value; 41,000 shares authorized, none outstanding	—			—
Series B junior participating preferred stock, $.01 par value; 300,000 shares authorized, none outstanding	—			—
Common stock, $.01 par value; 20,000,000 shares authorized, 6,069,643 and 5,963,434 shares issued and outstanding, respectively	61			60
Additional paid-in capital	82,158			81,047
Retained earnings	8,152			8,820
Accumulated other comprehensive loss	(2,894		)	(1,404		)
Total stockholders’ equity	87,477			88,523
Total liabilities and stockholders’ equity	$	269,768		$	275,925

The accompanying notes are an integral part of these Consolidated Financial Statements.

MOTHERS WORK, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

(unaudited)

Three Months Ended
March 31,

Six Months Ended
March 31,

2008

2007

2008

2007

Net sales