FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[x] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended October 28, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File No. 0-2633
VILLAGE SUPER MARKET, INC.
- ----------------------------------------------------------------
(Exact name of registrant as specified in its charter)
NEW JERSEY 22-1576170
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
733 Mountain Avenue, Springfield, New Jersey 07081
(Address of principal executive offices) (Zip code)
(201) 467-2200
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 (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__.
Indicate the number of shares outstanding of the issuer's classes of
common stock as of the latest practicable date.
<TABLE>
<CAPTION>
November 30, 1995
<S> <C>
Class A, Common Stock, No Par Value 1,315,800 Shares
Class B, Common Stock, No Par Value 1,594,076 Shares
</TABLE>
VILLAGE SUPER MARKET, INC.
INDEX
Part I Page No.
Financial Information
Item 1. Financial Statements
Consolidated Condensed Balance Sheets . . . . . . . . . . . . 3
Consolidated Condensed Statements of Income. . . . . . . . . . 4
Consolidated Condensed Statements of Cash Flows. . . . . . . . 5
Notes to Consolidated Condensed Financial Statements . . . . . 6
Item 2.
Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . . 7-8
Part II
Other Information
Item 6. Exhibits and Reports on Form 8-K. . . . . . . . . . . . . 9
Signatures. . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Exhibit 28 (a). . . . . . . . . . . . . . . . . . . . . . . . . . 11
Part 1. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
VILLAGE SUPER MARKET, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(Dollars in Thousands)
<TABLE>
<CAPTION >
October 28, July 29,
1995 1995
ASSETS
<S> <C> <C>
Current assets
Cash and cash equivalents $ 2,036 $ 9,655
Merchandise inventories 24,870 24,179
Patronage dividend receivable 3,996 2,683
Miscellaneous receivables 3,188 3,137
Prepaid expenses 668 630
Total current assets 34,758 40,284
Property, equipment and fixtures, net 69,295 69,916
Investment in related party 9,878 9,820
Goodwill, net 10,816 10,871
Other intangibles, net 2,725 2,791
Other assets 1,914 1,892
Total assets $129,386 $135,574
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND SHAREHOLDERS' EQUITY
<S> <C> <C>
Current liabilities
Current portion of long-term debt $ 5,080 $ 5,080
Accounts payable to related party 24,574 25,584
Accounts payable and accrued expenses 10,627 12,603
Deferred income taxes 772 772
Total current liabilities 41,053 44,039
Long-term debt, less current portion 31,511 34,852
Deferred income taxes 3,682 3,682
Shareholders' equity
Class A common stock - no par value,
issued 1,762,800 shares 18,129 18,129
Class B common stock - no par value,
issued & outstanding 1,594,076 shares 1,035 1,035
Retained earnings 40,161 40,022
Less cost of treasury shares
(447,000 shares) (6,185) (6,185)
Total shareholders' equity 53,140 53,001
Total liabilities and shareholders'
equity $129,386 $135,574
</TABLE>
See accompanying notes to consolidated condensed financial statements.
<TABLE>
<CAPTION>
VILLAGE SUPER MARKET, INC.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(Dollars in Thousands Except Per Share Amounts)
13 Weeks Ended 13 Weeks Ended
October 28, 1995 October 29, 1994
<S> <C> <C>
Sales $ 166,522 $ 167,366
Cost of sales 125,487 126,740
Gross Margin 41,035 40,626
Operating and administrative
expense 37,746 37,363
Depreciation and amortization
expense 2,073 2,109
Operating income 1,216 1,154
Interest expense (net) 985 1,021
Income before provision for
income taxes 231 133
Provision for income taxes 92 50
Net income $ 139 $ 83
Weighted average number
of common shares outstanding 2,909,876 2,909,876
Net income per share $ .05 $ .03
</TABLE>
See accompanying notes to consolidated condensed financial statements.
<TABLE>
<CAPTION>
VILLAGE SUPER MARKET, INC.
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
(Dollars in Thousands)
13 Weeks Ended 13 Weeks Ended
October 28,1995 October 29,1994
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C>
Net Income $ 139 $ 83
Adjustments to reconcile net income
to net cash provided (used) by
operating activities:
Depreciation and amortization 2,073 2,109
Provision to value inventories at LIFO 150 175
Changes in assets and liabilities:
(Increase) decrease in inventory (841) 51
(Increase) in patronage dividend
receivable (1,313) (1,377)
(Increase) in misc. receivables ( 51) (1,282)
(Increase) in prepaid expenses ( 38) ( 52)
(Increase) in other assets ( 22) ( 22)
Increase (decrease) in accounts payable
to related party (1,010) 625
(Decrease) in accounts payable and
accrued expenses (1,976) ( 724)
Net cash used by operating activities (2,889) ( 414)
CASH FLOW FROM INVESTING ACTIVITIES
Capital expenditures (1,331) (1,888)
Investment in related party ( 58) ( 38)
Net cash used by investing activities (1,389) (1,926)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of long-term debt -- 4,100
Principal payments of long-term debt (3,341) (3,197)
Net cash provided (used)
by financing activities (3,341) 903
NET (DECREASE) IN CASH AND
CASH EQUIVALENTS (7,619) (1,437)
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD 9,655 7,246
CASH AND CASH EQUIVALENTS,
END OF PERIOD $ 2,036 $ 5,809
</TABLE>
See accompanying notes to consolidated condensed financial statements.
VILLAGE SUPER MARKET, INC.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
1. In the opinion of the Company, the accompanying unaudited
consolidated condensed financial statements contain all adjustments
(consisting of normal and recurring accruals) necessary to present
fairly the financial position as of October 28, 1995 and July 29, 1995
and the results of operations and cash flows for the periods ended
October 28, 1995 and October 29, 1994.
The significant accounting policies followed by the Company are
set forth in Note 1 to the Company's financial statements in the July
29, 1995 Village Super Market, Inc. Annual Report.
2. The results of operations for the period ended October 28, 1995
are not necessarily indicative of the results to be expected for the
full year.
3. At both October 28, 1995 and July 29, 1995 approximately 66% of
merchandise inventories are valued by the LIFO method while the
balance is valued by FIFO. If the FIFO method had been used for the
entire inventory, inventories would have been $6,963,000 and
$6,813,000 higher than reported at October 28, 1995 and July 29, 1995,
respectively.
Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
- ----------------------------------------------------------------------
RESULTS OF OPERATIONS
Sales for the first quarter were $166,522,000 compared with sales of
$167,366,000 in the first quarter of the prior year. The slight sales
decrease was due to the prior year including one month's operations of
the Easton store. Same store sales were flat as the effects of new
competitive entries were offset by improved sales at two stores
remodeled last year.
Gross margin as a percentage of sales increased to 24.6% in the
current quarter compared with 24.3% in the corresponding quarter one
year ago. This improvement in gross margin is primarily due to an
improved mix of sales in higher margin departments and aggressive
buying practices.
Operating and administrative expenses as a percentage of sales
increased to 22.7% compared with 22.3% in the prior year. This
increase was due to higher coupon and supply costs. Coupon costs are
higher in response to new competitive entries. Higher supply costs
reflect the increased cost of paper bags that began in the second
quarter of fiscal 1995.
LIQUIDITY AND FINANCIAL RESOURCES
Current liabilities exceeded current assets by $6,295,000 at October
28, 1995 compared to $3,755,000 at July 29, 1995. The current ratio
decreased to .85 at October 28, 1995 compared to .91 at July 29, 1995.
The decline in working capital at October 28, 1995 is primarily a
result of the Company discontinuing its previous policy of borrowing
funds at the end of each quarter to maintain the current ratio
required in one of its debt agreements. That agreement has been
amended to delete the current ratio maintenance requirement.
During the quarter, debt payments of $3,341,000, capital
expenditures of $1,331,000 and cash used by operations of $2,889,000
resulted in a $7,619,000 reduction in cash balances. At October 28,
1995 the balance outstanding on the Company's line of credit was
$6,800,000.
The majority of capital expenditures in the current quarter related
to the ongoing remodel and expansion of the Absecon store. The
Company has budgeted approximately $8,000,000 for capital expenditures
in fiscal 1996, the majority of which relates to the Absecon project.
The Company expects to finance these expenditures through internally
generated funds and borrowings under its credit facility.
In November, the Company sold property of a store previously closed
in Maplewood, NJ for $1,450,000. A substantial gain on this
transaction will be recorded in the second quarter.
The Company is under contract to purchase properties in Westfield
and Garwood, NJ, contingent upon receiving all approvals, on which it
plans to construct one superstore. The Company's application to
Westfield's Planning Board has been denied and the Company has filed
suit to have this decision overturned. During November the company
reached a tentative settlement, contingent on certain conditions, with
Westfield to approve the building of a superstore and to settle the
lawsuit. The Town of Garwood has approved the same plan that
Westfield has denied. In addition, the Company has filed a second
application with Garwood to build the store entirely in Garwood should
the settlement with Westfield not be finalized. Should this store
ultimately be approved for construction, the Company would increase
its capital expenditure plans for fiscal 1996 and 1997. The Company
believes it can obtain the portion of the financing not already in
place to complete this project.
At October 28, 1995, the Company was in compliance with all
provisions of its revolving/term loan agreement. The Company did not
meet a cash flow to fixed charge coverage ratio contained in two other
debt agreements with one lender. This does not constitute an event of
default. However, until this ratio is met or unless a waiver is
obtained, the agreements prevent the Company from borrowing additional
funds (other than the Company's revolving loan), declaring dividends
and executing new leases. The Company expects to finalize an
amendment to these agreements during the second quarter to allow the
Company to borrow additional funds and execute leases.
PART II
OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
6(a) Exhibits:
Exhibit 28(a) - Press Release dated November 30, 1995
6(b) Reports on form 8-K.
None.
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.
Village Super Market, Inc.
Registrant
Date: November 30, 1995 /s/ Perry Sumas
Perry Sumas (President)
Date: November 30, 1995 /s/ Kevin R. Begley
Kevin R. Begley
(Chief Financial Officer)
EXHIBIT 28 (a)
VILLAGE SUPER MARKET, INC. REPORTS RESULTS
FOR THE FIRST QUARTER ENDED OCTOBER 28, 1995
Springfield, N.J. - November 30, 1995 - Village Super Market, Inc.
reported sales and net income for the first quarter ended October 28,
1995, Perry Sumas, President, announced today.
Net income was $139,000 in the first quarter of fiscal 1996, an
increase of 67% over the prior year. Sales for the first quarter were
$166,522,000, a slight decline from the prior year.
Net income improved due to an increase in gross margin, partially
offset by higher operating and administrative expenses. Gross margins
increased primarily as a result of improved product mix. Operating and
administrative expenses increased due to higher coupon and supply costs.
The slight decrease in sales for the quarter is due to the prior year
including one month's operations of the Easton, Pennsylvania store. Same
store sales were flat in the first quarter as the impact of new
competitive entries was offset by improved sales at two stores remodeled
in the past year.
Village Super Market, Inc. operates a chain of 23 supermarkets under
the ShopRite name in New Jersey and Eastern Pennsylvania.
The following table summarizes Village's results for the quarter ended
October 28, 1995.
<TABLE>
<CAPTION>
13 Weeks Ended 13 Weeks Ended
October 28, 1995 October 29, 1994
<S> <C> <C>
Sales $166,522,000 $167,366,000
Net Income $ 139,000 $ 83,000
Net Income Per Share $ .05 $ .03
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUL-29-1995
<PERIOD-END> OCT-28-1995
<CASH> 2036
<SECURITIES> 0
<RECEIVABLES> 2638
<ALLOWANCES> 0
<INVENTORY> 24870
<CURRENT-ASSETS> 34758
<PP&E> 133197
<DEPRECIATION> 63902
<TOTAL-ASSETS> 129386
<CURRENT-LIABILITIES> 41053
<BONDS> 31511
<COMMON> 19164
0
0
<OTHER-SE> 37658
<TOTAL-LIABILITY-AND-EQUITY> 129386
<SALES> 166522
<TOTAL-REVENUES> 166522
<CGS> 125487
<TOTAL-COSTS> 125487
<OTHER-EXPENSES> 39819
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 985
<INCOME-PRETAX> 231
<INCOME-TAX> 92
<INCOME-CONTINUING> 139
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 139
<EPS-PRIMARY> .05
<EPS-DILUTED> .05
</TABLE>
