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Previous: BANKERS TRUST NEW YORK CORP, 13F-E/A, 1997-04-14 |
Next: BASSETT FURNITURE INDUSTRIES INC, 4, 1997-04-14 |
<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED FEBRUARY 28, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
-------------------- -----------------------
Commission File No. 0-209
BASSETT FURNITURE INDUSTRIES, INCORPORATED
(Exact name of Registrant as specified in its charter)
Virginia 54-0135270
--------------------------------- ---------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
Bassett, Virginia 24055
-----------------------------
(Address of principal executive offices)
(Zip Code)
(703) 629-6000
(Registrant's telephone number, including area code)
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, and (2) has been subject to such filing
requirements for the past 90 days. Yes X No .
---------- ----------
At February 28, 1997, 13,075,595 shares of common stock of the Registrant were
outstanding.
Page 1 of 8
<PAGE> 2
PART I - FINANCIAL INFORMATION
BASSETT FURNITURE INDUSTRIES, INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF INCOME AND RETAINED EARNINGS - UNAUDITED
<TABLE>
<CAPTION>
THREE MONTHS ENDED FEBRUARY 28 (29),
------------------------------------
1997 1996
---- ----
<S> <C> <C>
Net sales $109,806,278 $111,951,020
Costs and expenses
Cost of sales 91,572,793 94,183,120
Selling, general and administrative 15,848,571 15,487,133
------------ ------------
107,421,364 109,670,253
------------ ------------
Income from operations 2,384,914 2,280,767
Other income, net 2,078,551 4,043,194
------------ ------------
Income before income taxes 4,463,465 6,323,961
Income taxes 1,030,000 1,610,000
------------ ------------
NET INCOME 3,433,465 4,713,961
Retained earnings - beginning of period 222,417,127 225,718,704
------------ ------------
225,850,592 230,432,665
Cash dividends (5,230,238) (2,716,550)
Purchase and retirement of common stock -0- (1,428,396)
------------ ------------
Retained earnings - end of period $220,620,354 $226,287,719
============ ============
NET INCOME PER SHARE $ .26 $ .35
===== =====
DIVIDENDS PER SHARE $ .40 $ .20
====== =====
</TABLE>
- ------------------------------------------
The accompanying note is an integral part of the condensed financial
statements.
Page 2 of 8
<PAGE> 3
PART I - FINANCIAL INFORMATION - CONTINUED
BASSETT FURNITURE INDUSTRIES, INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET - UNAUDITED
<TABLE>
<CAPTION>
ASSETS FEBRUARY 28, 1997 NOVEMBER 30, 1996
- ------ ------------------- -----------------
<S> <C> <C>
Current Assets
Cash and cash equivalents $ 55,451,598 $ 57,285,005
Trade accounts receivable, less allowances
for doubtful accounts 65,684,671 65,416,910
Inventories:
Finished goods 43,466,506 42,593,966
Work in process 14,334,690 14,008,754
Raw materials and supplies 38,249,563 38,275,770
------------ ------------
96,050,759 94,878,490
Less LIFO adjustment 28,146,000 27,796,000
------------ ------------
67,904,759 67,082,490
Prepaid expenses 1,377,343 1,492,506
Prepaid income taxes -0- 844,737
Deferred income taxes 2,669,000 2,597,000
------------ ------------
193,087,371 194,718,648
Property, Plant and Equipment
Cost 222,044,788 218,528,425
Less allowances for depreciation 163,227,357 162,149,761
------------ ------------
58,817,431 56,378,664
Other Assets
Investment in securities 31,442,195 29,625,435
Investment in affiliated companies 46,684,463 45,820,750
Other 9,711,002 8,621,947
------------ ------------
87,837,660 84,068,132
------------ ------------
$339,742,462 $335,165,444
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
Current Liabilities
Accounts payable $ 19,695,625 $ 20,541,014
Accrued compensation 2,809,230 3,716,206
Dividends payable 5,230,238 -0-
Other accrued liabilities 6,996,118 6,088,381
Income taxes 166,202 -0- .
------------ ------------
34,897,413 30,345,601
Deferrals
Deferred liabilities 10,767,720 10,834,741
Deferred income taxes 3,279,000 2,504,000
------------ ------------
14,046,720 13,338,741
Stockholders' Equity
Common stock 65,377,975 65,377,975
Retained earnings 220,620,354 222,417,127
Unrealized holding gains, net of tax 4,800,000 3,686,000
------------ ------------
290,798,329 291,481,102
------------ ------------
$339,742,462 $335,165,444
============ ============
</TABLE>
- -----------------------------------------------
The accompanying note is an integral part of the condensed financial
statements.
Page 3 of 8
<PAGE> 4
PART I - FINANCIAL INFORMATION - CONTINUED
BASSETT FURNITURE INDUSTRIES, INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS - UNAUDITED
<TABLE>
<CAPTION>
THREE MONTHS ENDED FEBRUARY 28 (29),
------------------------------------
1997 1996
---- ----
<S> <C> <C>
NET CASH PROVIDED BY OPERATING ACTIVITIES $ 1,884,683 $11,231,680
INVESTING ACTIVITIES
Net change in cost of investment securities (20,760) 7,886,426
Purchases of property, plant and equipment (4,314,417) (799,458)
Proceeds from sale of property, plant and equipment 332,552 70,635
Dividend from affiliated company 272,376 -0-
Other 12,159 162,144
----------- -----------
(3,718,090) 7,319,747
FINANCING ACTIVITIES
Cash dividends paid -0- (2,716,550)
Purchase and retirement of common stock -0- (1,821,896)
----------- -----------
-0- (4,538,446)
-----------
CHANGE IN CASH AND CASH EQUIVALENTS (1,833,407) 14,012,981
CASH AND CASH EQUIVALENTS - beginning of period 57,285,005 51,331,119
----------- -----------
CASH AND CASH EQUIVALENTS - end of period $55,451,598 $65,344,100
=========== ===========
</TABLE>
NOTE TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
I. Per share amounts are based on 13,075,595 and 13,614,639 weighted average
number of shares outstanding at February 28 (29), 1997 and 1996,
respectively.
Page 4 of 8
<PAGE> 5
PART I - FINANCIAL INFORMATION - CONTINUED
BASSETT FURNITURE INDUSTRIES, INCORPORATED AND SUBSIDIARIES
BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with the instructions to Form 10-Q and do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
RESULTS OF OPERATIONS:
Major components of net income expressed as a percentage of net sales:
<TABLE>
<CAPTION>
First Quarter Ending February
-----------------------------
1997 1996 1995
---- ---- ----
<S> <C> <C> <C>
Cost of sales 83.40% 84.13% 83.31%
Gross profit 16.60 15.87 16.69
SG&A expenses 14.43 13.83 12.96
Income from operations 2.17 2.04 3.73
Other income, net 1.89 3.61 1.87
Income before income taxes 4.06 5.65 5.60
Income taxes .94 1.44 1.64
Net income 3.12 4.21 3.96
</TABLE>
NET SALES
Net sales for the 1997 first quarter compared to prior years:
<TABLE>
<CAPTION>
1997 1996 1995
---- ---- ----
<S> <C> <C> <C>
Net sales (thousands) $109,806 $111,951 $123,551
Percentage change from prior year (1.92)% (9.4)% 1.6%
</TABLE>
Shipments increased in the Case and Table Divisions in 1997 over 1996 and
declined in the Upholstery Divisions.
COSTS AND EXPENSES
Cost of sales improved 73 basis points in the 1997 first quarter over 1996 and
approximates 1995 levels. The most significant improvement is in the material
component. The increase in the labor component reflects the initiative to
improve production employees' compensation rates. A comparison of the
components is shown below:
<TABLE>
<CAPTION>
First Quarter Ending February
-----------------------------
1997 1996 1995
---- ---- ----
<S> <C> <C> <C>
Materials 48.49% 50.04% 49.39%
Labor 22.47 21.29 21.54
Overhead 12.44 12.80 12.38
------- ------- -------
83.40% 84.13% 83.31%
</TABLE>
Selling, general and administrative expenses increased 60 basis points in 1997
over 1996. The cost increases were in categories associated with product
promotion and the focus on customer service.
Page 5 of 8
<PAGE> 6
PART I - FINANCIAL INFORMATION - CONTINUED
BASSETT FURNITURE INDUSTRIES, INCORPORATED AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS - CONTINUED
RESULTS OF OPERATIONS - CONTINUED:
OTHER INCOME, NET
Components of other income (thousands):
<TABLE>
<CAPTION>
First Quarter Ending February
-----------------------------
1997 1996 1995
---- ---- ----
<S> <C> <C> <C>
Equity in unremitted income of affiliated cos. $1,136 $1,101 $1,021
Dividends 352 438 543
Interest (principally tax exempt) 620 573 550
Gains from sales of investment securities -0- 2,115 (30)
Other (29) (184) 229
------ ------ ------
$2,079 $4,043 $2,313
====== ====== ======
</TABLE>
INCOME TAXES
The effective income tax rate is less than the statutory rates because of the
effect of non-taxable income in each period presented.
<TABLE>
<CAPTION>
First Quarter Ending February
-----------------------------
1997 1996 1995
---- ---- ----
<S> <C> <C> <C>
Effective Income Tax Rate 23.1% 25.5% 29.2%
</TABLE>
LIQUIDITY AND CAPITAL RESOURCES:
Cash provided by operating activities:
<TABLE>
<CAPTION>
First Quarter Ending February
-----------------------------
1997 1996 1995
---- ---- ----
<S> <C> <C> <C>
Cash provided by operating activities (thousands) $1,885 $11,232 $5,875
</TABLE>
The current ratio was 5.53 to 1 at February 28, 1997 and 6.42 to 1 at November
30, 1996. Working capital was $158 million at February 28, 1997, compared to
$164 million at November 30, 1996.
Cash provided by operating activities is expected to be adequate for normal
future operating requirements.
There were no material commitments for capital expenditures at February 28,
1997. Capital expenditures that will be made in the future for normal
expansion or other operating purposes will be made from funds on hand or those
generated from operations.
Page 6 of 8
<PAGE> 7
PART II - OTHER INFORMATION
BASSETT FURNITURE INDUSTRIES, INCORPORATED AND SUBSIDIARIES
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits
(27) Financial Data Schedule
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BASSETT FURNITURE INDUSTRIES, INCORPORATED
- ----------------------------------------------------------------
Robert H. Spilman, Chairman of the Board and Chief Executive Officer
Date:
----------------------------------
- ----------------------------------------------------------------
Philip E. Booker, Vice President, Controller (Chief Accounting Officer)
Date:
----------------------------------
Page 7 of 8
<PAGE> 8
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT
For the quarter ended Commission File Number
February 28, 1997 0-209
BASSETT FURNITURE INDUSTRIES, INCORPORATED
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Exhibit Description Page No.
- ----------- ------------------- --------
<S> <C> <C>
27 Financial Data Schedule page - 8
</TABLE>
Page 8 of 8
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> NOV-30-1997
<PERIOD-START> DEC-01-1996
<PERIOD-END> FEB-28-1997
<CASH> 55,452
<SECURITIES> 31,442
<RECEIVABLES> 65,685
<ALLOWANCES> 0
<INVENTORY> 67,905
<CURRENT-ASSETS> 193,087
<PP&E> 222,045
<DEPRECIATION> 163,227
<TOTAL-ASSETS> 339,742
<CURRENT-LIABILITIES> 34,897
<BONDS> 0
0
0
<COMMON> 65,378
<OTHER-SE> 225,420
<TOTAL-LIABILITY-AND-EQUITY> 339,742
<SALES> 109,806
<TOTAL-REVENUES> 111,885
<CGS> 91,573
<TOTAL-COSTS> 107,421
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 25
<INTEREST-EXPENSE> 2,000
<INCOME-PRETAX> 4,463
<INCOME-TAX> 1,030
<INCOME-CONTINUING> 3,433
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,433
<EPS-PRIMARY> .26
<EPS-DILUTED> 0
</TABLE>
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