UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended......April 28, 1996...........
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ...............to.............
Commission File Number...............0-16376.................
THE VALLEY FAIR CORPORATION
.............................................................
(Exact name of registrant as specified in its charter)
DELAWARE 22-1727148
.............................................................
(State or other jurisdiction of (I.R.S. Employer)
incorporation or organization) (Identification No.)
260 Bergen Turnpike, Little Ferry, New Jersey 07643
.............................................................
(Address of principal executive offices) Zip Code
(201) 440-4000
.............................................................
(Registrant's telephone number, including area code)
NONE
.............................................................
(Former name, former address and former fiscal year,
if changed since last report.)
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....
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING
THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports to be filed by Sections 12, 13 or 15(D) of the Securities Exchange Act
of 1934 subsequent to the distribution of the securities under a plan confirmed
by a court. Yes....No....
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
367,963 shares April 28, 1996
<PAGE>
The Valley Fair Corporation and Subsidiary
C O N T E N T S
Consolidated Condensed Balance Sheets
April 28, 1996 and January 28, 1996
Consolidated Condensed Statements of Income Thirteen
Thirteen weeks ended April 28, 1996
Thirteen weeks ended April 30, 1995
Consolidated Statements of Cash Flows -
Thirteen weeks ended April 28, 1996
Thirteen weeks ended April 30, 1995
Notes to Consolidated Condensed Financial Statements
Management's Discussion and Analysis of the Consolidated
Condensed Statements of Income
Other Information and Signatures
<PAGE>
<TABLE>
<CAPTION>
THE VALLEY FAIR CORPORATION AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Unaudited)
April 28, January 28,
1996 1996
----------- -----------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents .................................. $ 3,764,567 $ 3,608,605
Accounts receivable - trade ................................ 814,804 711,188
Accounts receivable - affiliates ........................... 128,912 128,912
Inventories ................................................ 22,683,929 23,955,006
Prepaid expenses ........................................... 690,376 582,341
Deferred income taxes ...................................... 418,000 443,000
----------- -----------
Total current assets .................................... 28,500,588 29,429,052
Property, plant and equipment--net ........................... 4,240,607 4,265,859
Other assets ................................................. 340,053 336,174
----------- -----------
33,081,248 34,031,085
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Note payable - bank ........................................ 9,429,000 9,710,300
Current maturities of long-term debt ....................... 57,054 65,010
Accounts payable Trade ............................. 2,295,549 2,911,974
Affiliate ......................... 297,753 405,764
Accrued expenses and other current
liabilities ................................................ 2,277,879 1,626,208
----------- -----------
Total current liabilities ............................... 14,357,235 14,719,256
----------- -----------
Long-term debt, less current maturities ...................... 219,106 233,569
Deferred income and security deposits ........................ 122,737 113,081
Deferred income taxes ........................................ 472,000 497,000
----------- -----------
Total liabilities ....................................... 15,171,078 15,562,906
----------- -----------
(Continued)
<PAGE>
<CAPTION>
THE VALLEY FAIR CORPORATION AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Unaudited)
April 28, January 28,
1996 1996
----------- -----------
<S> <C> <C>
Shareholder's equity
Common stock par value $.30 per share;
authorized 666,666 shares, issued
367,963 shares at April 28, 1996
367,983 shares at January 28, 1996 ......................... 110,389 110,395
Additional paid-in capital ................................... 802,240 802,754
Retained earnings ............................................ 16,997,541 17,555,030
----------- -----------
Total stockholders' equity ................................... 17,910,170 18,468,179
----------- -----------
$33,081,248 $34,031,085
=========== ===========
</TABLE>
The accompanying notes are an integral part of these condensed
financial statements.
<PAGE>
<TABLE>
<CAPTION>
THE VALLEY FAIR CORPORATION AND SUBSIDIARY
CONSOLIDATED CONDENSED STATEMENT OF INCOME
(Unaudited)
Thirteeen weeks Ended
April 28, 1996 April 30,1995
-------------- -------------
<S> <C> <C>
Net sales
excluding licensee departments .......... $ 14,679,769 $ 15,872,584
Cost of sales ............................ 10,012,076 10,873,396
------------ ------------
Gross profit ............................. 4,667,693 4,999,188
Tenant departments
licensee revenue and other .............. 1,398,529 1,145,045
------------ ------------
6,066,222 6,144,233
Selling, general and
administrative ...................... 6,803,885 5,919,016
------------ ------------
Income (loss) from operations ............ (737,663) 225,217
Interest expense ......................... 191,483 249,922
------------ ------------
Loss from operations
before income taxes .................... (929,146) (24,705)
Income taxes (benefit) ................... (371,657) (9,880)
------------ ------------
Net loss ................................. ($ 557,489) ($ 14,825)
============ ============
Earnings per
common share ............................ ($ 1.52) ($ 0.04)
Weighted average
number of shares ........................ 367,973 368,049
</TABLE>
The accompanying notes are an integral part of these condensed
financial statements.
<PAGE>
<TABLE>
<CAPTION>
THE VALLEY FAIR CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
Thirteen Weeks Ended April 28, 1996 and
Thirteen Weeks Ended April 30, 1995
1996 1995
--------- ----------
<S> <C> <C>
Cash flows from operating activities:
Net Loss ...................................... (557,489) (14,825)
--------- ----------
Adjustments to reconcile
net income to net cash
provided by operating
activities:
Gain on sale of assets .................... -0- (3,591)
Depreciation and amortization ............. 141,833 151,259
Increase in accounts and
notes receivable ......................... (103,616) (15,679)
Decrease (Increase) in inventories ........ 1,271,077 (1,463,375)
Increase in prepaid items ................. (108,035) (90,193)
Increase (decrease) in deferred
income and security deposits ............. 9,656 (39,170)
Decrease in accounts payable and
accrued expenses ......................... (72,765) (1,267,212)
Increase in other assets .................. (3,879) (9,601)
--------- ----------
Total adjustments ......................... 1,134,271 (2,737,562)
--------- ----------
Net cash provided (used) by
operating activities ..................... 576,782 (2,752,387)
--------- ----------
Cash flows from investing activities:
Capital expenditures ...................... (116,581) (141,615)
--------- ----------
Net cash used in investing
activities ............................... (116,581) (141,615)
--------- ----------
(continued)
<PAGE>
<CAPTION>
THE VALLEY FAIR CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
Thirteen Weeks Ended April 28, 1996
Thirteen Weeks Ended April 30, 1995
1996 1995
--------- ---------
<S> <C> <C>
Cash flows from financing activities:
Proceeds from issuance of
debt ................................... -0- 1,803,000
Principal payments of debt .............. (303,719) (102,460)
Purchase of common stock ................ (520) (182)
--------- ---------
Net cash provided (used) by
financing activities ................... (304,239) 1,700,358
--------- ---------
Net increase (decrease)
in cash ................................ 155,962 (1,193,644)
Cash and cash equivalents at
beginning of period .................... 3,608,605 3,652,566
--------- ---------
Cash and cash equivalents at
end of period .......................... 3,764,567 2,458,922
--------- ---------
</TABLE>
<PAGE>
THE VALLEY FAIR CORPORATION AND SUBSIDIARY
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
FOR THE THIRTEEN WEEKS ENDED APRIL 28, 1996
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
The financial information included herein is unaudited. In addition,
the financial information does not include all disclosures required
under generally accepted accounting principles because certain note
information included in the company's annual report has been
omitted: however, such information reflects all adjustments
(consisting solely of normal recurring adjustments) which are, in
the opinion of management, necessary to a fair statement of the
results for the interim periods.
The results of operations for the thirteen weeks ended April 28,
1996 and the thirteen weeks ended April 30, 1995 are not necessarily
indicative of the results to be expected for the full year.
NOTE 1(b)
Effective February 1, 1993, the Company adopted statement of
Financial Accounting Standards No. 109, Accounting For Income Taxes.
Statement 109 requires a charge for deferred taxes to an asset and
liability method of accounting for income taxes. Under the asset and
liability method, deferred tax assets and liabilities are recognized
for the future tax consequences. attributable to differences between
the financial statement carrying amounts of existing assets and
liabilities and their respective tax bases. The change in accounting
method for income taxes had no effect on consolidated earnings for
the period and prior financial statements were not restated.
NOTE 2 - EARNINGS PER SHARE
Earnings per share were computed by dividing net income by the
weighted average number of shares of common stock outstanding during
the periods. The Company has purchased and retired additional shares
during the current periods. The earnings per share calculation has
been adjusted to reflect these retirements during the periods.
<PAGE>
THE VALLEY FAIR CORPORATION AND SUBSIDIARY
Management's Discussion and Analysis of Financial Condition
and Results of Operations
Results of Operations
Consolidated net sales decreased approximately $1,193,000 or 7.5% for the
thirteen week period ended April 28, 1996, as compared to the thirteen weeks
ended April 30, 1995. Same store sales decreased approximately $980,000 or 6.4%.
Tenant license revenue and other income increased approximately $253,500 on a
comparative thirteen week basis.
The gross margin for the thirteen weeks ended April 28, 1996 was 31.8% as
compared to 31.5% for the same period a year ago. One factor contributing to the
increase in the gross profit percentage was the increase of promotional
merchandise purchased at favorable and liquidated values.
Selling, general and administrative expenses increased approximately $885,000 or
14.9%. The increase was due primarily to a provision for losses incurred in the
closing of 16 unprofitable stores. All store closings are projected to be
completed by June 1996. The relationship of these expenses to net sales was
46.3% for this period as compared to 37.3% for the same period a year ago.
Interest expense decreased approximately $ 50,000 or 23.4% as compared to the
1995 period as a result of greater loan payments and favorable interest rates in
the current fiscal quarter.
The Corporation's effective income tax rate for the two periods was
approximately 40%.
Liquidity and Capital Resourses
As of April 28, 1996, the Corporation's cash and short term investments amounted
to $3,765,000. The Corporation's principal sources of liquidity are its
available cash balances and funds available through its line of credit.
The Corporation believes that its cash and investment balances will be
sufficient to meet its anticipated needs throughout the remainder of the fiscal
year 1997.
<PAGE>
PART II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-k
(b) Reports Form 8-K - There were no reports on FORM 8-K filed
for the quarter ended April 28, 1996.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned there unto duly authorized.
THE VALLEY FAIR CORPORATION
---------------------------
(Registrant)
Date: June 10, 1996 /S/ ERWIN LEHR
---------------------------
Erwin Lehr - President
Date: June 10, 1996 /s/ ROSS N. ALFIERI
---------------------------
Ross N. Alfieri - Treasurer
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-29-1997
<PERIOD-END> APR-28-1996
<CASH> 3,764,567
<SECURITIES> 0
<RECEIVABLES> 961,694
<ALLOWANCES> 17,978
<INVENTORY> 22,683,929
<CURRENT-ASSETS> 28,500,588
<PP&E> 11,338,890
<DEPRECIATION> 7,098,283
<TOTAL-ASSETS> 33,081,248
<CURRENT-LIABILITIES> 14,357,235
<BONDS> 219,106
0
0
<COMMON> 110,389
<OTHER-SE> 17,799,781
<TOTAL-LIABILITY-AND-EQUITY> 33,081,248
<SALES> 14,679,769
<TOTAL-REVENUES> 16,078,298
<CGS> 10,012,076
<TOTAL-COSTS> 16,815,961
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 191,483
<INCOME-PRETAX> (929,146)
<INCOME-TAX> 371,657
<INCOME-CONTINUING> (557,489)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (557,489)
<EPS-PRIMARY> (1.52)
<EPS-DILUTED> 0
</TABLE>
