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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended: October 31, 1999
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF SECURITIES EXCHANGE ACT OF 1934
Commission file number: 1-7643
WASHINGTON HOMES, INC.
(Exact name of registrant as specified in its charter)
MARYLAND 52-0818872
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification No.)
1802 Brightseat Road, Landover, MD 20785-4235
(Address of principal executive offices) (Zip Code)
(301) 772-8900
(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 [ ]
Number of shares of each of the registrant's classes of common stock outstanding
at October 31, 1999
Class Number of Shares
----- ----------------
Common Stock (voting), $.01 par value 7,929,013
Common Stock (non-voting), $.01 par value 0
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<PAGE>
WASHINGTON HOMES, INC.
FORM 10-Q
TABLE OF CONTENTS
Page
----
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
Condensed Consolidated Balance Sheets
-- October 31, 1999 (Unaudited) and July 31, 1999 .................... 3
Condensed Consolidated Statements of Earnings
-- Three Months Ended October 31, 1999 and 1998 (Unaudited) .......... 4
Condensed Consolidated Statement of Shareholders' Equity
-- Three Months Ended October 31, 1999 (Unaudited) ................... 5
Condensed Consolidated Statements of Cash Flows
-- Three Months Ended October 31, 1999 and 1998 (Unaudited) .......... 6
Notes to Condensed Consolidated Financial Statements (Unaudited) ..... 7
ITEM 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations ........................... 8
ITEM 3. Quantitative and Qualitative Disclosures about Market Risk .... 12
PART II. OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K .............................. 12
SIGNATURES ............................................................... 13
2
<PAGE>
PART 1. ITEM 1. Financial Statements
WASHINGTON HOMES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands)
October 31, July 31,
1999 1999
----------- --------
ASSETS
Cash and cash equivalents ............................ $ 12,156 $ 12,734
Residential inventories .............................. 141,886 130,502
Excess of cost over net assets acquired, net ......... 8,631 8,731
Investment in joint ventures ......................... 4,326 3,876
Other ................................................ 12,452 11,612
-------- --------
Total Assets ....................................... $179,451 $167,455
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Notes and loans payable .............................. $ 76,368 $ 59,526
Trade accounts payable ............................... 21,525 24,568
Income taxes ......................................... 2,513 3,986
Other ................................................ 7,486 10,426
-------- --------
Total liabilities .................................. 107,892 98,506
Shareholders' Equity
Common stock
15,000,000 shares voting common stock authorized,
7,929,013 shares issued and outstanding ............ 79 79
1,100,000 shares non-voting common stock authorized,
0 shares issued and outstanding .................... 0 0
Additional paid - in capital ......................... 35,161 35,178
Retained earnings .................................... 36,319 33,692
-------- --------
Total shareholders' equity ......................... 71,559 68,949
-------- --------
Total Liabilities and Shareholders' Equity ......... $179,451 $167,455
======== ========
See accompanying Notes.
3
<PAGE>
WASHINGTON HOMES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
(in thousands except common share data)
Three Months Ended
October 31,
---------------------
1999 1998
------- -------
Revenues
Homebuilding ..................................... $85,889 $67,745
Land sales ....................................... 418 475
Other income ..................................... 1,116 908
------- -------
Total revenues ................................. 87,423 69,128
Expenses
Cost of sales - homebuilding ..................... 68,794 55,426
Cost of sales - land ............................. 396 441
Selling, general and administrative .............. 12,033 9,371
Interest ......................................... 1,546 1,514
Financing fees ................................... 206 202
Amortization and depreciation expense ............ 166 97
------- -------
Total expenses ................................. 83,141 67,051
------- -------
Earnings before income taxes ....................... 4,282 2,077
Income tax expense ............................... 1,655 808
------- -------
Net earnings ....................................... $ 2,627 $ 1,269
======= =======
Earnings per common share
Basic ............................................ $ 0.33 $ 0.16
======= =======
Diluted .......................................... $ 0.32 $ 0.16
======= =======
Weighted average common shares
Basic ............................................ 7,946,187 7,942,763
Diluted .......................................... 8,218,161 7,942,763
See accompanying Notes.
4
<PAGE>
WASHINGTON HOMES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
Three months ended October 31, 1999
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
Common Stock Additional Total
------------------- Paid-in Retained Shareholders'
Voting Non-voting Capital Earnings Equity
------ ---------- ---------- -------- -------------
<S> <C> <C> <C> <C> <C>
Balance, August 1, 1999 ........ $ 79 $ 0 $35,178 $33,692 $68,949
Purchase and retirement of
Company stock ................. -- -- (111) -- (111)
Deferred compensation plan ..... -- -- 94 -- 94
Net earnings ................... -- -- -- 2,627 2,627
---- ---- ------- ------- -------
Balance, October 31, 1999 ...... $ 79 $ 0 $35,161 $36,319 $71,559
==== ==== ======= ======= =======
</TABLE>
See accompanying Notes.
5
<PAGE>
WASHINGTON HOMES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
Three Months Ended
October 31,
--------------------
1999 1998
-------- --------
Cash flows from operating activities:
Net earnings ......................................... $ 2,627 $ 1,269
Adjustments to reconcile net earnings to
net cash used in operating activities:
Amortization and depreciation .................... 166 97
Changes in assets and liabilities:
Residential inventories ............................ (11,384) (2,127)
Other assets ....................................... (1,156) 902
Trade accounts payable ............................. (3,043) (3,341)
Income taxes payable ............................... (1,473) (563)
Other liabilities .................................. (2,940) (8)
Deferred compensation liability..................... 94 0
-------- --------
Net cash used in operating activities .......... (17,109) (3,771)
Cash flows from investing activities:
Purchases of property and equipment, net of disposals (200) (60)
-------- --------
Net cash used in investing activities .......... (200) (60)
Cash flows from financing activities:
Proceeds from notes and loans payable ................ 76,050 56,000
Repayments of notes and loans payable ................ (59,208) (46,195)
Purchase and retirement of Company stock ............. (111) 0
-------- --------
Net cash provided by financing activities ...... 16,731 9,805
Net (decrease) increase in cash and cash equivalents ... (578) 5,974
Cash and cash equivalents, beginning of period ......... 12,734 10,321
-------- --------
Cash and cash equivalents, end of period ............... $ 12,156 $ 16,295
======== ========
See accompanying Notes.
6
<PAGE>
WASHINGTON HOMES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Organization and Basis of Presentation
The unaudited condensed consolidated financial statements include the
accounts of Washington Homes, Inc. and its wholly owned subsidiaries (the
"Company").
The Company is principally engaged in the business of the construction and
sale of residential housing. All significant intercompany balances and
transactions have been eliminated in consolidation.
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and SEC regulations. Accordingly, they do not
include all of the information and notes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting only of normal recurring accruals)
considered necessary for a fair presentation have been included. These condensed
consolidated financial statements should be read in conjunction with the
financial statements and notes thereto in the Company's Annual Report to
Shareholders for the year ended July 31, 1999. Operating results for the three
months ended October 31, 1999 are not necessarily indicative of the results that
may be expected for the year ending July 31, 2000.
2. Shareholders' Equity
Common Stock. The Company has 7,929,013 shares of common stock outstanding
at October 31, 1999 all of which are voting shares. Except for voting rights,
the non-voting common stock is substantially the same as the Company's voting
common stock.
Deferred Compensation Incentive Plan. Effective as of July 31, 1999, the
Company adopted a Deferred Compensation Incentive Plan ("Plan") for certain key
employees who may elect to defer a portion of their future compensation. The
Company will match the lesser of 20% of the amount deferred or $20,000, with the
match subject to a five-year vesting schedule. The Plan will be funded by the
purchase of the Company's common stock. Any Company stock acquired by the Plan
will be retired by the Company and the future issuance of the same number of
shares will be from newly issued shares. In October 1999, 20,000 shares were
acquired by the Plan. As a result of this transaction, Paid in Capital was
reduced as follows:
Stock purchase price........................ $111,000
Decrease in deferred compensation payable... (94,000)
--------
Net decrease in Paid in Capital............. $ 17,000
3. Earnings Per Share
Basic earnings per common share are based on the weighted average number of
shares of common stock outstanding during each period. Diluted earnings per
common share are based on the weighted average number of shares of common stock
outstanding plus equivalent shares relating to stock options outstanding.
4. Notes and Loans Payable
Notes and loans payable consist of the following:
October 31, July 31,
1999 1999
----------- --------
(in thousands)
Senior Notes ............................... $14,333 $28,667
Revolving Credit Facilities ................ 57,959 27,639
Land Acquisition and Other ................. 4,076 3,220
------- -------
$76,368 $59,526
======= =======
Senior Notes. In April 1994, the Company issued $43,000,000 principal
amount of unsecured Senior Notes. Two series of Senior Notes were issued:
$30,000,000 with a fixed rate of 8.61% per annum, with interest payable
semi-annually beginning in October 1994 and $13,000,000 with a floating rate of
LIBOR plus 2.4% (8.59% at October 31, 1999), with interest payable July 1994 and
either quarterly or semi-annually thereafter at the option of the Company.
Beginning April 1998 interest became payable on a quarterly basis for both
series of Senior Notes. Principal repayments are due in three equal annual
installments commencing in October 1998 and continuing to October 2000. The
scheduled principal repayments of $14,333,333 were made in October 1998 and
October 1999.
7
<PAGE>
Revolving Credit Facilities. At October 31, 1999, the Company had two
secured credit facilities totaling $135 million to fund land acquisition, home
construction, letters of credit, and principal repayments on its Senior Notes.
In September 1999, the Company increased the credit availability under one of
the facilities to $120 million from $70 million. The new credit facility is
comprised of a $100 million revolving loan with a maturity date (which may be
extended) of October 30, 2001, and a $20 million, term loan with an initial
maturity of 2 years plus three one-year extention options. $14.3 million of the
term loan was used in October 1999 for a principal repayment of the Company's
Senior Notes. The remaining 5.7 million will be used to repay a portion of the
Senior Notes repayment due in October 2000. The other credit facility consists
of a $15 million revolving loan with a maturity date (which may be extended) of
April 19, 2001. At October 31, 1999, $58.0 million was outstanding under both
facilities. Borrowings under the facilities bear interest at 30 day LIBOR (5.41%
at October 29, 1999) plus either 1.75% for the revolving credit facilities and
2.85% for the term loan.
Land Acquisition Loans. The Company has loans with various land sellers and
lenders for the acquisition of land which bear interest at fixed rates ranging
from 8.0% to 10% or variable rates of prime to prime plus .5% and are
collateralized by the related inventory.
ITEM 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Annual Operating Cycle
The homebuilding industry in general and the operations of the Company are
seasonal in nature. The number of new orders received is generally higher in the
period from February through May compared to the balance of the year. Deliveries
peak in the fiscal quarter ending July 31 as a substantial portion of homes for
which contracts are written during the fiscal quarter ending April 30 are
delivered. Delivery volume is relatively constant during the remainder of the
year. Backlog is the number of homes under contract but not delivered at the end
of the period. Revenue is recognized upon the delivery of finished homes. The
following table, which sets forth the quarterly operating results for the
Company during the last five fiscal quarters illustrates this cycle:
<TABLE>
<CAPTION>
Three Months Ended
--------------------------------------------------------------
October 31, January 31, April 30, July 31, October 31,
1998 1999 1999 1999 1999
----------- ----------- --------- -------- -----------
(dollars in thousands)
Selected Operating Data
- -----------------------
<S> <C> <C> <C> <C> <C>
Revenues - homebuilding ........ $ 67,745 $ 70,723 $ 87,720 $127,541 $ 85,889
Number of homes delivered ...... 407 427 533 757 483
Number of net new orders ....... 430 432 836 531 587
Number of homes in backlog ..... 844 849 1,234 1,008 1,112
Sales value of backlog ......... $147,100 $153,947 $229,570 $197,135 $219,846
</TABLE>
8
<PAGE>
Geographic Breakdown of Operations
Set forth below is information for the Company's operations by geographic
markets:
Three Months Ended
October 31,
------------------
Net New Orders 1999 1998
-------------- ------ ------
Maryland ........................................ 176 145
Virginia ........................................ 165 102
North Carolina .................................. 156 138
Tennessee ....................................... 34 32
Pennsylvania .................................... 15 13
Alabama* ........................................ 12 --
Mississippi* .................................... 29 --
---- ----
587 430
==== ====
Three Months Ended
October 31,
------------------
Homes Delivered 1999 1998
--------------- ------ ------
Maryland ........................................ 143 115
Virginia ........................................ 105 83
North Carolina .................................. 132 181
Tennessee ....................................... 34 14
Pennsylvania .................................... 9 14
Alabama* ........................................ 38 --
Mississippi* .................................... 22 --
---- ----
483 407
==== ====
October 31,
------------------
Backlog of Sold Homes 1999 1998
--------------------- ------ ------
Maryland ........................................ 276 270
Virginia ........................................ 447 195
North Carolina .................................. 263 285
Tennessee ....................................... 48 60
Pennsylvania .................................... 23 34
Alabama* ........................................ 24 --
Mississippi* .................................... 31 --
----- ----
1,112 844
===== ====
* Homebuilding operations for Alabama and Mississippi were acquired in
March 1999.
Results of Operations
Three Months Ended October 31, 1999 Compared to Three Months Ended
October 31, 1998
Total revenues from homes delivered increased by 27% to $85.9 million
during the three months ended October 31, 1999 compared to $67.7 million during
the three-month period ended October 31, 1998 as the number of homes delivered
increased to 483 in the first quarter of fiscal 2000 from 407 homes in the first
quarter of fiscal 1999. The increased level of revenues reflects continuing
strong housing demand resulting from a generally strong economy, growth in
active communities in our existing markets and the addition of the Huntsville
and Gulfport markets. The average sales price of homes delivered increased to
$177,800 for the first quarter of fiscal 2000 from $166,400 for the first
quarter of fiscal 1999. This change is principally due to increased deliveries
of single family detached homes and increased deliveries of higher end product
in our Virginia market.
9
<PAGE>
Revenues and gross profit from land sales were $418,000 and $22,000,
respectively, for the three months ended October 31, 1999 as compared to
$475,000 and $34,000, respectively, during the same three-month period in fiscal
1999.
Other income increased $208,000 to $1,116,000 during the three months ended
October 31, 1999 compared to $908,000 in the same three-month period in fiscal
1999. The increase is primarily due to increased income from mortgage
origination activity.
Gross profit as a percentage of revenues from homes delivered increased to
19.9% during the three months ended October 31, 1999 compared to 18.2% during
the same three-month period in fiscal 1999 primarily due to the Company's cost
reduction initiatives and sales price increases based on overall strong housing
demand.
Selling, general and administrative expenses increased $2.6 million to
$12.0 million during the three-month period ended October 31, 1999, compared to
$9.4 million in the same three-month period in fiscal 1999. The increase is
attributable to the 27% increase in homebuilding revenue and the increase in
active communities to 84 from 72 a year ago. Selling, general and administrative
expenses increased as a percentage of homebuilding revenue to 14.0% in the
three-month period ended October 31, 1999, compared to 13.8% for the same period
in fiscal 1999 due to expenses associated with expansion of the mortgage
operations and opening of new communities.
Operating income (earnings before interest, financing fees and taxes)
increased to $6.0 million in the three months ended October 31, 1999 compared to
$3.8 million for the same period in fiscal 1999 and increased as a percentage of
homebuilding revenues to 7.0% from 5.6% for the same period in fiscal 1999.
Interest and financing fees increased to $1.8 million during the three
months ended October 31, 1999 compared to $1.7 million in the same three-month
period in fiscal 1999. However, interest and financing fees as a percent of
homebuilding revenue decreased to 2.0% in the first fiscal quarter of fiscal
2000 compared to 2.5% of the first quarter of fiscal 1999.
Capital Resources and Liquidity
Funding for the Company's residential building and land development
activities is provided principally by cash flows from operations and borrowings
from banks and other financial institutions. The Company's capital needs depend
upon its sales volume, asset turnover, land purchases and inventory levels.
At October 31, 1999, the Company had cash and cash equivalents of $12.2
million of which $655,000 was restricted to collateralize customer deposits and
other escrows. The remaining $11.5 million was available to the Company.
The Company had $153.4 million in borrowing available from various lending
institutions and land sellers of which $76.4 million was outstanding at October
31, 1999.
The Company believes that it will be able to fund its activities through
fiscal 2000 through a combination of operating cash flow, existing cash balances
and existing credit facilities. Except for ordinary expenditures for the
construction of homes and acquisition and development of land, the Company does
not have any material commitments for capital expenditures at the present time.
10
<PAGE>
Year 2000 Issues
The Year 2000 (Y2K) problem is the result of computer programs being
written using two digits rather than four to define the applicable year. Thus
the year 1999 is represented by the number "99" in many legacy software
applications. Consequently, on January 1, 2000, the year will jump back to "00"
in accordance with many non-Y2K compliant applications. To systems that are
non-Y2K compliant, the time will seem to have reverted back 100 years. So, when
computing basic lengths of time, the Company's computer programs, certain
building infrastructure components (including elevators, alarm systems,
telephone networks, sprinkler systems, security access systems and certain HVAC
systems) and any additional time-sensitive software that are non-Y2K compliant
may recognize a date using "00" as the Year 1900. This could result in system
failures or miscalculations which could cause personal injury, property damage,
disruption of operations, and/or delays in payments from the Company's
customers, any or all of which could materially adversely effect the Company's
business, financial condition, or results of operations.
State of Readiness:
During fiscal 1999 the Company undertook a formal year 2000 readiness
project assessment on all information technology assets to ensure compliance of
all applications, operating systems and hardware on its PC desktop suites and
LAN and WAN server and communications platforms; the compliance of voice and
data network software and hardware and to address the compliance of key vendors
and other third parties.
The Company's project involved five phases: (1) inventorying Year 2000
items and assigning priorities, (2) assessing the Year 2000 compliance of items,
(3) remediating or replacing items that were determined not to be Y2K compliant,
(4) testing items for Y2K compliance and (5) designing and implementing Y2K
contingency and business continuity plans. To determine that all IT systems
(whether internally developed or purchased) are Y2K compliant, each system was
tested using a standard testing methodology which included unit testing,
baseline testing, and future date testing. Future date testing included critical
dates near the end of 1999 and into the year 2000, including leap year testing.
The inventory and assessment phases of the project were completed in April
1999. At October 31, 1999, all of the Company's application systems had been
remediated and current date tested. All critical hardware and software was
compliant and tested by October 1999.
Cost:
The costs of the Company's Y2K compliance efforts were funded with cash
flows from operations. The estimated total cost of the Y2K project is
approximately $75,000. Costs incurred during fiscal 1999 were approximately
$37,000, with the remainder of the estimated total being incurred during the
first and second quarters of fiscal 2000. In total, these costs are not expected
to have material adverse effect on the Company's overall results of operations
or cash flows.
Risk:
The Company believes that its Y2K readiness program will prepare the
Company for Year 2000 compliance in a timely manner. There can be no assurance,
however, that the Company's internal systems or equipment or those external
parties on which the Company relies will be Y2K compliant in a timely manner or
that the Company's external parties contingency plans will mitigate the effects
of any non-compliance. Given the current status of the Company's Y2K project,
management believes that the most probable worst case scenario could result in
short term business interruptions. However, failure by the Company and/or
external parties to complete Y2K readiness work in a timely manner could have a
material adverse affect on the Company's financial position and results of
operations.
11
<PAGE>
Contingency Plans:
The Company has developed a Y2K contingency plan designed to address
problems arising from Year 2000 failures of critical third parties and is
directed towards providing alternate sources of supply to the Company.
The foregoing assessment of the impact of the Y2K problem on the Company is
based on management's best estimate at the present time, and could change
substantially. The assessment is based upon numerous assumptions as to future
events. There can be no guarantee that these estimates will prove accurate, and
actual results could differ from those estimated if these assumptions prove
inaccurate.
Forward Looking Statements
This Form 10-Q report contains statements, which may be construed as
"forward looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. These forward looking statements may involve
known and unknown risks, uncertainties and other factors that may cause actual
results performance, achievements or industry results, to vary materially from
predicted results, performance, achievements or those of the industry. Such
risks, uncertainties and other factors, include, but are not limited to, change
in general economic conditions, fluctuations in interest rates, increases in
cost of and availability of materials, supplies and labor and general
competitive conditions.
ITEM 3. Quantitative and Qualitative Disclosures about Market Risk
The Company is exposed to market risk from changes in interest rates.
Adverse changes in interest rates can have a material effect on the Company's
operations.
At October 31, 1999, the Company had $76.4 million of debt outstanding of
which $11.9 million bears fixed interest rates. If the interest rate charged to
the Company on its variable rate debt were to increase significantly, the effect
could be materially adverse to future operations.
The Company's objective in its risk management program is to seek a
reduction in the potential negative earnings effects from changes in interest
rates. The Company's strategy to meet this objective is to maintain a balance
between fixed-rate and variable-rate debt, varying the proportion based on the
Company's perception of interest rate trends and the market place for various
debt instruments. In addition, the Company has entered into an interest rate
swap agreement, which effectively converts $15 million of its variable rate debt
to fixed in an effort to minimize its market risk from changes in interest
rates. The fair values of all financial instruments approximate their carrying
values.
PART II. OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits
27. Financial Data Schedule
(b) Reports on Form 8-K
The registrant did not file any reports on Form 8-K during the quarter
ended October 31, 1999.
12
<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.
WASHINGTON HOMES, INC.
(Registrant)
Date: December 14, 1999 By: /s/ Geaton A. DeCesaris, Jr.
---------------------------------
Geaton A. DeCesaris, Jr.
Chairman of the Board, President,
and Chief Executive Officer
Date: December 14, 1999 By: /s/ Clayton W. Miller
---------------------------------
Clayton W. Miller
Principal Accounting Officer
13
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S CONDENSED CONSOLIDATED BALANCE SHEET AND CONDENSED CONSOLIDATED
STATEMENT OF NET EARNINGS AT AND FOR THE PERIOD ENDED OCTOBER 31, 1999 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUL-31-1999
<PERIOD-END> OCT-31-1999
<CASH> 12,156
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 141,886
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 179,451
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 79
<OTHER-SE> 71,480
<TOTAL-LIABILITY-AND-EQUITY> 179,451
<SALES> 86,307
<TOTAL-REVENUES> 87,423
<CGS> 69,190
<TOTAL-COSTS> 81,389
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,752
<INCOME-PRETAX> 4,282
<INCOME-TAX> 1,655
<INCOME-CONTINUING> 2,627
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,627
<EPS-BASIC> .33
<EPS-DILUTED> .32
</TABLE>
