FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1999
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 number: 0-22675
800-JR CIGAR, INC.
Delaware 52-2022117
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
301 Route 10 East, Whippany, New Jersey 07981, USA (973)884-9555
Not applicable
(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 CORPORATE REGISTRANTS)
Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date.
Common Stock, $.01 par value - 12,752,146 shares as of November 10, 1999.
<PAGE>
800-J.R. Cigar, Inc. and Subsidiaries
Index to Form 10-Q
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS PAGE
Consolidated Statements of Income for the Three-Month Periods
ended September 30, 1998 and 1999 (Unaudited) and the Nine-Month Periods
ended September 30, 1998 and 1999 (Unaudited).............................3
Consolidated Balance Sheets as of December 31, 1998 (Audited) and
September 30, 1999 (Unaudited)............................................4
Consolidated Statements of Cash Flows for the Nine-Month Periods ended
September 30, 1998 and 1999 (Unaudited)...................................5
Notes to Consolidated Financial Statements.....................................6
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations..................................................10
Item 3. Quantitative and Qualitative Disclosure About Market Risk............13
PART II - OTHER INFORMATION
Item 1. Legal Proceedings....................................................14
Item 6. Exhibits and Reports on Form 8-K.....................................14
Signatures....................................................................15
<PAGE>
800-J.R. Cigar, Inc. and Subsidiaries
Consolidated Statements of Income
(Unaudited)
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
THREE-MONTH PERIOD Nine-month period
ENDED SEPTEMBER 30 ended September 30
---------------------------- ------------------------
1999 1998 1999 1998
-----------------------------------------------------
<S> <C> <C> <C> <C>
Net sales $79,871 $73,177 $231,491 $205,414
Cost of goods sold 65,978 58,274 191,492 164,266
---------------------------- -------------------------
Gross profit 13,893 14,903 39,999 41,148
Operating expenses:
Selling 1,651 1,522 5,551 4,332
General and administrative
expenses 6,603 5,896 19,215 16,225
Depreciation and amortization 557 350 1,582 1,135
----------------------------------------------------
Income from operations 5,082 7,135 13,651 19,456
Other income (expense):
Interest expense (176) (311) (638) (1,019)
Interest income 275 443 667 1,355
Rental income 41 42 121 125
Other, net (99) 13 (238) 40
---------------------------- -----------------------
Income before income taxes 5,123 7,322 13,563 19,957
Provision for income taxes 2,054 2,987 5,439 8,152
----------------------------------------------------
Net income $ 3,069 $ 4,335 $ 8,124 $ 11,805
====================================================
Per share data:
Earnings per share - basic $ .25 $ .34 $ .65 $ .93
============================ =======================
Earnings per share - diluted $ .25 $ .34 $ .65 $ .92
============================ =======================
Weighted average shares
outstanding - basic 12,291 12,733 12,430 12,744
============================ =======================
Weighted average shares
outstanding - diluted 12,291 12,733 12,430 12,813
============================ =======================
SEE ACCOMPANYING NOTES.
</TABLE>
3
<PAGE>
800-J.R. Cigar, Inc. and Subsidiaries
Consolidated Balance Sheets
(IN THOUSANDS)
<TABLE>
<CAPTION>
SEPTEMBER December
30, 1999 31, 1998
-----------------------------
Assets (Unaudited) (Audited)
Current assets:
<S> <C> <C>
Cash and cash equivalents $ 12,942 $ 12,759
Investments in marketable securities 4,544 5,719
Accounts receivable, net 1,999 2,568
Merchandise inventory 42,092 49,056
Prepaid expenses and other current assets 5,117 4,712
Loans receivable - affiliates and other
associated entities 862 685
Deferred tax asset 837 1,183
-----------------------------
Total current assets 68,393 76,682
Property, equipment and improvements, at cost,
net of accumulated depreciation and amortization 31,398 27,614
Other assets 412 376
----------------------------
$100,203 $104,672
============================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of distribution notes payable
to stockholders $ 6,950 $ 7,933
Accounts payable 12,543 16,238
Accrued expenses 2,480 1,864
----------------------------
Total current liabilities 21,973 26,035
Distribution notes payable to stockholders,
less current portion - 4,967
----------------------------
Total liabilities 21,973 31,002
Commitments and contingencies
Stockholders' equity:
Common stock 128 128
Additional paid-in capital 52,779 52,751
Retained earnings 30,190 22,066
----------------------------
83,097 74,945
Less treasury stock, at cost (4,867) (1,275)
----------------------------
Total stockholders' equity 78,230 73,670
----------------------------
$100,203 $ 104,672
============================
SEE ACCOMPANYING NOTES.
</TABLE>
4
<PAGE>
800-J.R. Cigar, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
(IN THOUSANDS)
<TABLE>
<CAPTION>
NINE-MONTH PERIOD
ENDED SEPTEMBER 30
1999 1998
-----------------------------
Cash flows from operating activities
<S> <C> <C>
Net income $ 8,124 $11,805
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization 1,582 1,135
Provision for uncollectible accounts 90 72
Deferred income taxes 346 31
Changes in operating assets and liabilities:
Accounts receivable 479 (1,212)
Merchandise inventory 6,964 (6,590)
Prepaid expenses and other current assets (405) (463)
Other assets (36) (133)
Accounts payable and accrued expenses (3,079) 5,349
-----------------------------
Net cash provided by operating activities 14,065 9,994
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sales of marketable securities 1,175 2,499
Purchase of property and equipment (5,366) (5,982)
Loans (extended to) repaid by affiliates and other
associated entities (177) 189
-----------------------------
Net cash used in investing activities (4,368) (3,294)
CASH FLOWS FROM FINANCING ACTIVITIES
Purchase of treasury stock (3,592) (900)
Proceeds from issuance of common stock 28
Payments on distribution notes (5,950) (5,950)
-----------------------------
Net cash used in financing activities (9,514) (6,850)
-----------------------------
Net increase (decrease) in cash and cash equivalents 183 (150)
Cash and cash equivalents at beginning of period 12,759 16,572
-----------------------------
Cash and cash equivalents at end of period $12,942 $16,422
=============================
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Interest paid $ 527 $ 937
=============================
Income taxes paid $ 3,499 $ 7,552
=============================
SEE ACCOMPANYING NOTES.
</TABLE>
5
<PAGE>
800-JR Cigar, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(Unaudited)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
September 30, 1999
1. Unaudited Financial Statements
The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X.
Accordingly, they do not include all of the information and footnote disclosures
normally included in complete financial statements prepared in accordance with
generally accepted accounting principles. For further information, such as
significant accounting policies followed by the Company, refer to the notes to
the Company's audited consolidated financial statements for the year ended
December 31, 1998.
In the opinion of management, the unaudited financial statements include all
necessary adjustments (consisting of normal, recurring accruals) for a fair
presentation of the financial position, results of operations and cash flows for
the interim periods presented. The results of operations for the three-month
periods ended September 30, 1999 and 1998 and the nine-month periods ended
September 30, 1999 and 1998, are not necessarily indicative of the operating
results to be expected for a full year.
2. Basis of Presentation
800-JR Cigar, Inc. ("800-JR Cigar") was incorporated in Delaware in March 1997.
In connection with 800-JR Cigar's initial public offering of stock (the
"Offering") on June 26, 1997, the former principals of a predecessor group of
companies contributed to 800-JR Cigar all of the outstanding stock in the
entities that comprise the predecessor group of companies, in exchange for
9,300,000 shares of common stock of 800-JR Cigar.
All significant intercompany balances and transactions have been eliminated.
6
<PAGE>
800-JR Cigar, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(Unaudited) (continued)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
September 30, 1999
3. COMPUTATION OF BASIC AND DILUTED EARNINGS PER SHARE
The following table sets forth the computation of basic and diluted earnings per
share:
<TABLE>
<CAPTION>
THREE-MONTH PERIOD Nine-month period
ENDED SEPTEMBER 30 ended September 30
1999 1998 1999 1998
-------------------------- -------------------------
Numerator:
<S> <C> <C> <C> <C>
Net income $ 3,069 $ 4,335 $ 8,124 $11,805
========================== ========================
Denominator:
Denominator for basic earnings
per share - weighted-average
shares 12,291 12,733 12,430 12,744
Effect of dilutive securities
- stock options - - - 69
-------------------------- ------------------------
Denominator for diluted earnings
per share - adjusted
weighted-average shares
and assumed conversion 12,291 12,733 12,430 12,813
========================== ========================
Basic earnings per share $ .25 $ .34 $ .65 $ .93
========================== ========================
Diluted earnings per share $ .25 $ .34 $ .65 $ .92
========================== ========================
</TABLE>
Common stock equivalents are excluded from the calculation of diluted earnings
per share for the three month periods ended September 30, 1999 and 1998 and for
the nine month period ended September 30, 1999 as their effect would be
anti-dilutive.
4. Revolving Credit Facility
The Company has a $20 million revolving Credit Facility which expires on May 31,
2000. Borrowings under this facility are unsecured and bear interest at the
bank's prime rate minus 1/2% or, at the option of the Company, 1.5% over the
London Interbank Offered Rate (LIBOR). There were no amounts outstanding under
this facility at September 30, 1999.
7
<PAGE>
800-JR CIGAR, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
SEPTEMBER 30, 1999
5. Stock Repurchase Plan
On August 25, 1998, the Board of Directors approved the repurchase of up to $10
million of the Company's common stock from time to time subject to market
conditions. Purchases can be made in the open market or in privately negotiated
transactions. At September 30, 1999 and December 31, 1998, the Company had
purchased 503,400 shares and 114,500 shares, respectively, at a cost of $4,867
and $1,275, respectively.
6. Segment Reporting
The Company has two segments determined by type of customer and made up of
retail and wholesale operations. The Company's retail division sells cigars,
tobacco products, cigarettes, fragrances and other merchandise to the general
public through direct mail order, cigar stores, and discount outlet stores. The
Company's wholesale division sells cigars and cigarettes to wholesale
distributors through the wholesale mail order and wholesale cigarette operations
located within the Company's discount outlet stores. The Company operates only
throughout the United States.
The reportable segments are each managed separately because the Company markets
these segments of the business separately. Although revenues of the retail and
wholesale divisions are further monitored based upon marketing and distribution
channel, overall profitability is measured only at the retail/wholesale level.
The Company evaluates performance based on profit or loss. The accounting
policies of the reportable segments are the same as those described in the
summary of significant accounting policies. The accounting for the assets of
each segment is the same as in consolidation.
8
<PAGE>
800-JR CIGAR, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED) (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
SEPTEMBER 30, 1999
6. SEGMENT REPORTING (CONTINUED)
The Company's operations by business segment for the three months ended
September 30, 1999 and 1998 and the nine-month periods ended September 30, 1999
and 1998 are as follows:
<TABLE>
<CAPTION>
THREE-MONTH PERIOD Nine-month period
ENDED SEPTEMBER 30 ended September 30
1999 1998 1999 1998
-------------------------- -------------------------
NET SALES
<S> <C> <C> <C> <C>
Retail $40,145 $41,652 $116,615 $111,237
Wholesale 39,726 31,525 114,876 94,177
-------------------------- -------------------------
Total consolidated net sales $79,871 $73,177 $231,491 $205,414
========================== =========================
SEGMENT NET INCOME
Retail $ 961 $ 297 $ 2,413 $ 1,809
Wholesale 2,253 4,116 6,490 10,156
-------------------------- -------------------------
Total segment net income 3,214 4,413 8,903 11,965
RECONCILING ITEM
Corporate net loss (145) (78) (779) (160)
-------------------------- -------------------------
Total consolidated net income $ 3,069 $ 4,335 $ 8,124 $ 11,805
========================== =========================
</TABLE>
There has been no material change in total assets by segment from the amount
disclosed in the annual report on Form 10-K at December 31, 1998.
9
<PAGE>
PART I.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
This report contains certain "forward-looking statements."Those statements
appear in a number of places in this report and include statements regarding the
intent, belief or current expectations of the Company, its directors and its
officers with respect to, among other things: (i) trends affecting the Company's
financial condition or results of operations; (ii) the Company's financing
plans; (iii) the Company's business and growth strategies; (iv )the Company's
ability to identify and address Year 2000 issues; and (v) the declaration and
payment of dividends. Prospective investors are cautioned that any such
forward-looking statements are not guarantees of future performance and involve
risks and uncertainties and that actual results may differ materially from those
projected in the forward-looking statements as a result of various factors.
General.
The Company is one of the largest distributors and retailers of tobacco and
tobacco related products in North America. The Company operates in a large and
highly fragmented industry characterized by multiple and relatively undeveloped
channels of distribution. With its 29-year history in the cigar industry, the
Company has established itself as an important participant in the movement of
tobacco products from manufacturers to the customers. Manufacturers value the
Company's ability to perform distribution, credit, customer support and
marketing functions, which would otherwise be the responsibility of the
manufacturer. Customers value the Company's extensive variety of tobacco
products and rapid order fulfillment and benefit from advantageous pricing
derived through the Company's volume buying as a direct importer and
distributor.
Three-month Period Ended September 30, 1999 Compared to Three-Month Period Ended
September 30, 1998
Net sales were $79.9 million and $73.2 million for the third quarters of 1999
and 1998, respectively, an increase of $6.7 million or 9.2%. Retail sales
decreased 3.6 % to $40.1 million for the third quarter of 1999 from $41.7
million for the third quarter of 1998. The decrease in retail sales was due
primarily to a $3.1 million, or 17.5% decrease in direct mail order cigars,
offset by sales generated by the new Burlington outlet store. Wholesale sales
increased 26.1% to $39.7 million for the third quarter of 1999 from $31.5
million over the same period in the prior year. The increase in wholesale sales
was due primarily to a $9.0 million or 55.2% increase in cash-and-carry
cigarette sales.
Gross profit was $13.9 million and $14.9 million for the third quarters of 1999
and 1998, respectively, a decrease of $1.0 million or 6.8%. As a percentage of
net sales, gross profit decreased to 17.4% for the third quarter of 1999 from
20.4% for the third quarter of 1998, primarily due to an increase in lower
margin cigarette sales and a general price reduction for premium cigars.
10
<PAGE>
Selling, general and administrative ("S, G & A") expenses were $8.3 million and
$7.4 million for the third quarters of 1999 and 1998, respectively, an increase
of $0.8 million or 11.3%. As a percentage of net sales, S, G & A expenses
increased to 10.4% for the third quarter of 1999 from 10.2% for the third
quarter of 1998 primarily due to increased staffing and other costs associated
with the Company's new discount outlet store and warehouse operations in
Burlington, North Carolina, opened in October 1998, and the expansion of two
discount outlet stores in North Carolina.
Income from operations was $5.1 million and $7.1 million for the third quarters
of 1999 and 1998, respectively, a decrease of $2.0 million or 28.8%. As a
percentage of net sales, income from operations decreased to 6.4% for the third
quarter of 1999 from 9.8% for the third quarter of 1998, primarily due to a
decrease in gross margins and higher S, G & A costs.
Interest expense was $0.2 and $0.3 million for the third quarters of 1999 and
1998, respectively, a decrease of $0.1 million. The decrease in interest expense
was due to a reduction in the distribution notes payable to stockholders. Other
income, primarily interest, was $0.2 million and $0.4 million for the third
quarters of 1999 and 1998, respectively. The decrease was primarily due to a
reduction in short-term investments.
Income before income taxes was $5.1 million and $7.3 million for the third
quarters of 1999 and 1998, respectively, a decrease of $2.2 million or 30.0%.
As a result of the foregoing, the Company had net income of $3.1 million in the
third quarter of 1999, compared to net income of $4.3 million for the third
quarter of 1998, a decrease of $1.2 million or 29.2%.
Nine-month Period Ended September 30, 1999 Compared to Nine-Month Period Ended
September 30, 1998
Net sales were $231.5 million and $205.4 million for the first nine-months of
1999 and 1998, respectively, an increase of $26.1 million or 12.7%. Retail sales
increased 4.8% to $116.6 million for the first nine-months of 1999 from $111.2
million for the first nine-months of 1998. The increase in retail sales was due
primarily to a $10.8 million, or 28.4% increase in discount outlet store sales
resulting from the Burlington Discount Outlet Store, which commenced operations
in the fourth quarter of 1998. This increase was partially offset by a 9.8%
decrease in mail order sales. Wholesale sales increased 22.0% to $114.9 million
for the first nine-months of 1999 from $94.2 million over the same period in the
prior year. The increase in wholesale sales was due primarily to a $22.0 million
or 42.6% increase in cash-and-carry cigarette sales.
Gross profit was $40.0 million and $41.1 million for the first nine-months of
1999 and 1998, respectively, a decrease of $1.1 million or 2.8%. The decrease in
gross profit was primarily due to an increase in the sale of lower margin
cigarettes and a general price reduction for premium cigars. As a percentage of
net sales, gross profit decreased to 17.3% for the first nine-months of 1999
from 20.0% for the first nine-months of 1998.
11
<PAGE>
Selling, general and administrative ("S, G & A") expenses were $24.8 million and
$20.6 million for the first nine-months of 1999 and 1998, respectively, an
increase of $4.2 million or 20.3%. The increase in S,G&A expenses was related to
increased staffing and other costs associated with the new discount outlet store
and warehouse in Burlington, North Carolina, which commenced operations in the
fourth quarter of 1998 and the expansion of two discount outlet stores in North
Carolina. As a percentage of net sales, S,G&A expenses increased to 10.6% for
the first nine-months of 1999 from 10.0% for the first six-months of 1998.
Income from operations was $13.7 million and $19.5 million for the first
nine-months of 1999 and 1998, respectively, a decrease of $5.8 million or 29.8%.
As a percentage of net sales, income from operations decreased to 5.9% for the
first nine-months of 1999 from 9.5% for the first nine-months of 1998, primarily
due to a reduction in gross margins and higher S,G&A costs.
Interest expense was $0.6 million and $1.0 million for the first nine-months of
1999 and 1998, respectively. The decrease in interest expense was due to a
reduction in the distribution notes payable to stockholders. Other income,
primarily interest, was $0.6 million and $1.5 million for the first nine-months
of 1999 and 1998, respectively. The decrease in interest income was primarily
due to a reduction in short-term investments.
Income before income taxes was $13.6 million and $20.0 million for the first
nine-months of 1999 and 1998, respectively, a decrease of $6.4 million or 32.0%
As a result of the foregoing, the Company had net income of $8.1 million in the
first nine-months of 1999, compared to net income of $11.8 million for the first
nine-months of 1998, a decrease of $3.7 million or 31.2%.
Liquidity and Capital Resources
As of September 30, 1999, the Company had working capital of $46.4 million
compared to $50.6 million at December 31, 1998. Working capital as of September
30, 1999 is comprised primarily of cash and cash equivalents of $12.9 million,
short-term investments of $4.5 million, accounts receivable of $2.0 million,
$42.1 million of inventory and $5.1 million of prepaid and other current assets
offset by $15.0 million of accounts payable and accrued expenses and $7.0
million of the current portion of the distribution notes.
The Company has available a short term, unsecured line of credit in the amount
of $20.0 million through May 31, 2000 with interest at either the bank's base
rate minus 50 basis points or an increment over LIBOR, at the Company's option.
There were no amounts outstanding under the Company's line of credit as of
September 30, 1999.
On June 6, 1997, the Company issued notes in the aggregate amount of $23.8
million to shareholders of the predecessor companies, representing the estimated
cumulative undistributed earnings of the predecessor companies which operated
under Subchapter "S"of the Internal Revenue Service code. The notes have a fixed
interest rate of 7.0% and require quarterly payments in aggregate of $2.0
million plus interest through June 1, 2000.
12
<PAGE>
The first payment of principal and interest was made effective September 1,
1997. In addition, on June 6, 1997, the Predecessor Companies also issued
additional Distribution Notes to shareholders of the Predecessor Companies for a
nominal amount. On December 31, 1997, the initial principal amount was increased
to $1.0 million, the maximum allowable. The additional Distribution Notes mature
on June 1, 2000 and bear interest at the rate of 7.0% per annum. The holders of
the notes have agreed to subordinate payment of principal and interest to senior
lenders if required by credit agreements. The existing credit agreement does not
require subordination in the event of default under the terms and conditions of
the agreement.
The repurchase of up to $10.0 million of the Company's common stock was approved
by the Board of Directors subject to market conditions. In the quarter ended
September 30, 1999, the Company repurchased 53,000 shares of its outstanding
common shares at an average price of $10.50 raising the total shares repurchased
to 503,400 at an average cost of $9.67 as of September 30, 1999.
The Company anticipates that it will be able to satisfy its ongoing cash
requirements for the foreseeable future, primarily with cash flows from
operations, and cash and short-term investments, supplemented as necessary by
borrowings under its existing line of credit.
Year 2000
During 1995, the Company purchased versions of its principal information
technology software packages, which have been certified as Year 2000 compliant
by the respective software vendors. The Company has completed all of the
required modifications of non-critical data processing systems.
The Company has also made inquiries of its significant vendors and service
providers to determine the extent to which interfaces with such entities are
vulnerable to Year 2000 issues. Most of those contacted have indicated that they
have begun implementing Year 2000 readiness programs. The Company is continuing
to follow-up with significant vendors and service providers that did not
initially respond, or whose responses were deemed unsatisfactory.
Based upon its current state of readiness, the Company believes that the Year
2000 issue will not pose significant operational problems for the Company.
However, if all Year 2000 issues are not properly identified, there can be no
assurance that the Year 2000 issue will not materially adversely impact the
Company's results of operations or adversely affect the Company's relationships
with customers, vendors, or others. Additionally, there can be no assurance that
the Year 2000 issues of other entities will not have a material adverse impact
on the Company's systems or results of operations.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
The Company does not trade in derivative financial instruments. The Company's
revolving line of credit bears interest at a variable rate (prime minus 1/2%)
and, therefore, the Company is subject to market-risk in the form of interest
rate fluctuations.
13
<PAGE>
Part II. Other Information
Item 1. Legal Proceedings
The Company is not presently involved in any legal proceedings which, if
determined adversely to the Company, would have a material effect on the
Company.
Item 6. Exhibits and Reports on Form 8-K
The Company did not file any reports on Form 8-K during the three months ended
September 30, 1999.
14
<PAGE>
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.
800-JR CIGAR, INC.
DATE: NOVEMBER 9, 1999 BY:_/S/ LEWIS I. ROTHMAN____________
- --------------------
Lewis I. Rothman, Chairman and President
DATE: NOVEMBER 9, 1999 BY:_/S/ MICHAEL E. COLLETON_________
-----------------------
Michael E. Colleton, Chief Financial Officer
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0001035507
<NAME> 800-JR CIGAR, INC.
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-1-1999
<PERIOD-END> SEP-30-1999
<EXCHANGE-RATE> 1
<CASH> 12,942
<SECURITIES> 4,544
<RECEIVABLES> 1,999
<ALLOWANCES> 0
<INVENTORY> 42,092
<CURRENT-ASSETS> 68,393
<PP&E> 38,821
<DEPRECIATION> 7,423
<TOTAL-ASSETS> 100,203
<CURRENT-LIABILITIES> 21,973
<BONDS> 0
0
0
<COMMON> 128
<OTHER-SE> 78,230
<TOTAL-LIABILITY-AND-EQUITY> 100,203
<SALES> 231,491
<TOTAL-REVENUES> 231,491
<CGS> 191,492
<TOTAL-COSTS> 26,348
<OTHER-EXPENSES> 238
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (638)
<INCOME-PRETAX> 13,563
<INCOME-TAX> 5,439
<INCOME-CONTINUING> 8,124
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,124
<EPS-BASIC> .65
<EPS-DILUTED> .65
</TABLE>
