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: April 30, 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 (IRS 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 April 30, 1999:
Class Number of Shares
----- ----------------
Common Stock (voting), $.01 par value 7,942,763
Common Stock (non-voting), $.01 par value 0
<PAGE>
WASHINGTON HOMES, INC.
FORM 10-Q
TABLE OF CONTENTS
Page
----
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
Condensed Consolidated Balance Sheets
- April 30, 1999 and July 31, 1998 (Unaudited) 3
Condensed Consolidated Statements of Operations
- Three Months and Nine Months Ended April 30, 1999 and 1998 (Unaudited) 4
Condensed Consolidated Statement of Shareholders' Equity
- Nine Months Ended April 30, 1999 (Unaudited) 5
Condensed Consolidated Statements of Cash Flows
- Nine Months Ended April 30, 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
PART II. OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K 13
SIGNATURES 14
2
<PAGE>
PART 1. ITEM 1. Financial Statements
WASHINGTON HOMES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
April 30, July 31,
1999 1998
--------- --------
(in thousands)
ASSETS
Cash and cash equivalents $ 9,682 $ 10,321
Residential inventories 136,045 113,198
Excess of cost over net assets acquired, net 8,832 6,015
Investment in joint ventures 4,101 2,848
Other 16,053 13,590
-------- --------
Total Assets $174,713 $145,972
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Notes and loans payable $ 80,004 $ 58,255
Trade accounts payable 20,481 21,647
Income taxes 3,101 3,217
Other 6,702 4,583
-------- --------
Total Liabilities 110,288 87,702
Shareholders' Equity
Common Stock
15,000,000 shares voting common stock authorized,
7,942,763 and 7,914,433 issued and outstanding; 79 79
1,100,000 shares non-voting common stock authorized,
0 and 28,330 shares issued and outstanding; 0 0
Additional paid - in capital 35,147 35,147
Retained earnings 29,199 23,044
-------- --------
Total Shareholders' Equity 64,425 58,270
-------- --------
Total Liabilities and Shareholders' Equity $174,713 $145,972
======== ========
See accompanying Notes.
3
<PAGE>
WASHINGTON HOMES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Nine Months Ended
April 30, April 30,
------------------- -------------------
1999 1998 1999 1998
-------- -------- -------- --------
(in thousands except per share data)
Revenues
Homebuilding $ 87,720 $ 52,262 $226,188 $139,215
Land sales 649 1,506 3,721 4,242
Other income 1,028 676 2,877 1,828
-------- -------- -------- --------
Total revenues 89,397 54,444 232,786 145,285
Expenses
Cost of sales - homebuilding 70,568 43,018 183,321 114,199
Cost of sales - land 634 1,031 3,544 3,457
Selling, general and administrative 11,098 8,049 30,095 21,238
Interest 1,827 1,202 4,897 3,195
Financing fees 203 197 601 529
Amortization and depreciation expense 104 134 308 331
-------- -------- -------- --------
Total expenses 84,434 53,631 222,766 142,949
-------- -------- -------- --------
Earnings before income taxes 4,963 813 10,020 2,336
Income tax expense 1,916 249 3,865 970
-------- -------- -------- --------
Net earnings $ 3,047 $ 564 $ 6,155 $ 1,366
======== ======== ======== ========
Earnings per common share
Basic $ 0.38 $ 0.07 $ 0.77 $ 0.17
====== ====== ====== ======
Diluted $ 0.37 $ 0.07 $ 0.75 $ 0.17
====== ====== ====== ======
Weighted average common shares
Basic 7,942,763 7,942,763 7,942,763 7,942,763
Diluted 8,201,001 7,965,428 8,184,884 7,955,105
See accompanying Notes.
4
<PAGE>
WASHINGTON HOMES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
Nine Months Ended April 30, 1999
(Unaudited)
(in thousands)
Common Stock Additional Total
------------------ Paid-in Retained Shareholders'
Voting Non-voting Capital Earnings Equity
------ ---------- ---------- -------- -------------
Balance, August 1, 1998 $ 79 $ 0 $35,147 $23,044 $58,270
Net earnings -- -- -- 6,155 6,155
---- ---- ------- ------- -------
Balance, April 30, 1999 $ 79 $ 0 $35,147 $29,199 $64,425
==== ==== ======= ======= =======
See accompanying Notes.
5
<PAGE>
WASHINGTON HOMES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended April 30,
---------------------------
1999 1998
-------- --------
(in thousands)
Cash flows from operating activities:
Net earnings $ 6,155 $ 1,366
Adjustments to reconcile net earnings to
net cash used in operating activities:
Amortization and depreciation 308 331
Deferred income taxes 0 (116)
Changes in assets and liabilities net of
Breland Homes purchase:
Residential inventories (13,567) (9,685)
Other assets (3,071) (621)
Trade accounts payable (2,216) (956)
Income taxes (92) 21
Other liabilities 1,981 (731)
-------- -------
Net cash used in operating activities (10,502) (10,391)
Cash flows from investing activities:
Purchases of property and equipment, net
of disposals (226) (64)
Purchase of Breland Homes' assets, net (5,272) --
Advances to joint ventures -- (10)
-------- -------
Net cash used in investing activities (5,498) (74)
Cash flows from financing activities:
Proceeds from notes and loans payable 159,813 75,981
Repayments of notes and loans payable (144,452) (64,886)
-------- -------
Net cash provided by financing activities 15,361 11,095
-------- -------
Net (decrease) increase in cash and cash equivalents (639) 630
Cash and cash equivalents, beginning of period 10,321 10,313
-------- -------
Cash and cash equivalents, end of period $ 9,682 $10,943
======== =======
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, 1998. Operating results for the three
and nine months ended April 30, 1999 are not necessarily indicative of the
results that may be expected for the year ending July 31, 1999.
2. Shareholders' Equity
Common Stock. The Company has 7,942,763 shares of Common Stock outstanding
at April 30, 1999 all of which are voting shares. During the third quarter of
fiscal 1999, all of the remaining 28,330 shares of non-voting common stock were
exchanged with the Company for newly-issued shares of voting common stock on a
share for share basis. Except for voting rights, the non-voting common stock is
substantially the same as the Company's voting common stock.
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:
April 30, July 31,
1999 1998
--------- --------
(in thousands)
Senior Notes $28,667 $43,000
Revolving Credit Facilities 48,450 12,197
Land Acquisition and Other 2,887 3,058
------- -------
$80,004 $58,255
======= =======
Senior Notes. In April 1994, the Company issued $43,000,000 principal
amount of 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% (7.4% at
April 30, 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 first principal repayment of
$14,333,333 was made in October 1998.
7
<PAGE>
Revolving Credit Facilities. At April 30, 1999, the Company had two secured
revolving credit facilities totaling $85,000,000 to fund land acquisition and
home construction, letters of credit, and the initial principal repayment on its
Senior Notes. The facilities have maturity dates (which may be extended) of
October 30, 2000 and April 30, 2001. Borrowings under the facilities bear
interest at 30 day LIBOR (4.9% at April 30, 1999) plus 1.55% or 1.75%,
(depending upon the mix of collateral) and are secured by the related inventory.
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 10.0% or variable rates of prime to prime plus 1% and are
collateralized by the related inventory.
Interest Rate Swap. In January 1998, the Company entered into an interest
rate swap agreement to manage interest exposure on the Company's variable rate
debt. Amounts to be paid or received under the swap agreement are accrued as
interest rates change and are recognized over the life of the swap agreement as
an adjustment to interest expense. The fair value of the swap agreement was not
recognized in the consolidated financial statements, since it is accounted for
as a hedge. This swap agreement expires in January 2002 and effectively converts
$15 million of variable LIBOR backed borrowings to a fixed LIBOR of 5.67% at
April 30, 1999.
5. Acquisition
During the quarter ended April 30, 1999, the Company purchased homebuilding
assets and assumed the related liabilities of Breland Homes, Inc.; Breland Homes
of Mississippi, LLC; and Breland Properties, Inc. (collectively "Breland
Homes"). Breland Homes is a privately-owned homebuilder with operations in
Huntsville, Alabama and Biloxi and Gulfport, Mississippi. The transaction was
effective as of March 1, 1999. Reference is made to the Company's Current Report
on Form 8-K dated May 4, 1999 for further information. The allocation of the
purchase price is as follows:
Residential inventories $11,471,000
Other assets 3,476,000
Less: liabilities assumed (9,675,000)
-----------
Net cash paid $ 5,272,000
===========
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 signed 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:
8
<PAGE>
<TABLE>
<CAPTION>
Three Months Ended
---------------------------------------------------------
April 30, July 31, October 31, January 31, April 30,
1998 1998 1998 1999 1999
--------- -------- ----------- ----------- ---------
(dollars in thousands)
<S> <C> <C> <C> <C> <C>
Selected Operating Data
- -----------------------
Revenues-homebuilding $ 52,262 $ 93,896 $ 67,745 $ 70,723 $ 87,720
Number of homes delivered 340 584 407 427 533
Number of net new orders 640 398 430 432 836
Number of homes in backlog 1,007 821 844 849 1,234
Sales value of backlog $168,726 $141,619 $147,100 $153,947 $229,570
</TABLE>
Geographic Breakdown of Operations
Set forth below is information for the Company's operations by geographic
markets:
Three Months Ended Nine Months Ended
April 30, April 30,
------------------ -----------------
Net New Orders 1999 1998 1999 1998
---- ---- ---- ----
Maryland 226 213 487 379
Virginia 258 111 489 274
North Carolina 242 261 530 531
Tennessee 53 37 114 80
Pennsylvania 14 18 35 47
Alabama 31 0 31 0
Mississippi 12 0 12 0
---- ---- ----- -----
836 640 1,698 1,311
==== ==== ===== =====
Three Months Ended Nine Months Ended
April 30, April 30,
------------------ -----------------
Homes Delivered 1999 1998 1999 1998
---- ---- ---- ----
Maryland 164 114 405 286
Virginia 89 75 262 194
North Carolina 195 115 529 331
Tennessee 32 28 88 54
Pennsylvania 19 8 49 30
Alabama 21 0 21 0
Mississippi 13 0 13 0
---- ---- ----- ----
533 340 1,367 895
==== ==== ===== ====
April 30,
----------------
Backlog of Sold Homes 1999 1998
----- -----
Maryland 322 321
Virginia 403 218
North Carolina 329 385
Tennessee 68 42
Pennsylvania 21 41
Alabama 56 0
Mississippi 35 0
----- -----
1,234 1,007
===== =====
9
<PAGE>
Results of Operations
Three Months Ended April 30, 1999 Compared to Three Months Ended April 30, 1998
Total revenues increased 64% to $89.4 million during the three months ended
April 30, 1999 as compared to $54.4 million during the three month period ended
April 30, 1998 as the number of homes delivered increased to 533 in the third
quarter of fiscal 1999 from 340 homes in the third quarter of fiscal 1998. The
increased deliveries were attributable to successful execution of the Company's
strategic initiatives and generally improved market conditions. The average
sales price of homes delivered increased to $164,600 for the third quarter of
fiscal 1999 from $153,700 for the third quarter of fiscal 1998. Changes in the
average selling price of homes delivered may vary from period to period based on
product mix and pricing of specific communities.
Revenues and gross profit from land sales were $649,000 and $15,000,
respectively, for the three month period ended April 30, 1999 compared to $1.5
million and $475,000 during the three month period in fiscal 1998.
Other income increased $352,000 to $1,028,000 during the three months ended
April 30, 1999 as compared to $676,000 in the same three month period in fiscal
1998. The increase is primarily due to increased income from mortgage
origination activity.
Gross profit as a percentage of revenues from homes delivered increased to
19.6% during the three months ended April 30, 1999 compared to 17.7% during the
same three month period in fiscal 1998. The increase in gross profit margins is
due to a combination of favorable market conditions and cost reduction
initiatives implemented during fiscal 1998.
Selling, general and administrative expenses increased $3.1 million to
$11.1 million during the three month period ended April 30, 1999, compared to
$8.0 million in the same three month period in fiscal 1998. The increase is
principally due to increased volume. However, selling, general and
administrative expenses decreased as a percentage of homebuilding revenue to
12.7% in the three months ended April 30, 1999, compared to 15.4% for the same
period in fiscal 1998 as a result of increased deliveries and improved sales
absorption per community.
Interest and financing fees increased to $2.0 million during the three
months ended April 30, 1999 as compared to $1.4 million in the same three month
period in fiscal 1998. However, due to the increased volume, interest and
financing fees as a percent of homebuilding revenues decreased to 2.3% from 2.7%
in the third quarter of fiscal 1998.
Nine Months Ended April 30, 1999 Compared to Nine Months Ended April 30, 1998
Total revenues increased $87.5 million (60%) to $232.8 million during the
nine months ended April 30, 1999 compared to $145.3 million during the nine
month period ended April 30, 1998. The number of homes delivered increased 53%
to 1,367 homes in the first nine months of fiscal 1999 from 895 homes in the
first nine months of fiscal 1998. During this period the average sale price of
homes delivered increased to $165,500 in the first nine months of fiscal 1999
from $155,500 in the first nine months of fiscal 1998. Changes in average
selling price of homes delivered may vary from period to period based on product
mix and pricing of specific communities.
Revenues and gross profit from land sales were $3.7 million and $177,000,
respectively, for the nine month period ended April 30, 1999 compared to $4.2
million and $785,000 during the nine month period in fiscal 1998.
Gross profit as a percentage of revenues from homes delivered increased
to 19.0% during the nine month period ended April 30, 1999 compared to 18.0%
during the nine month period ended April 30, 1998. The increase in gross profit
margins is due to a combination of favorable market conditions and cost
reduction initiatives implemented during fiscal 1998.
10
<PAGE>
Selling, general and administrative expenses increased $8.9 million to
$30.1 million during the nine month period ended April 30, 1999 as compared to
$21.2 million for the same nine month period in fiscal 1998. The increase is
primarily due to increased volume. However, selling, general and administrative
expenses as a percentage of homebuilding revenues decreased from 15.3% for the
nine months ended April 30, 1998 to 13.3% for the same fiscal period in 1999 as
a result of increased deliveries and improved sales absorption per community.
Interest and financing fees increased to $5.5 million in the nine months
ended April 30, 1999 as compared to $3.7 million for the same period in fiscal
1998. However, due to the increased volume, interest and financing fees as a
percent of homebuilding revenues decreased to 2.4% from 2.7% in the nine months
of fiscal 1998.
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 April 30, 1999, the Company had cash and cash equivalents of $9.7
million of which $719,000 was restricted to collateralize customer deposits and
other escrows. The remaining $9.0 million was available to the Company.
The Company had $116.6 million in borrowing availability from various
lending institutions and land sellers of which $80.0 million was outstanding at
April 30, 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 borrowings from banks and other lending institutions. 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.
Year 2000 Issues
The Year 2000 (Y2K) issue is the result of computer programs being written
using two digits rather than four to define the applicable year. If not
corrected, computer software programs that have time-sensitive software may not
recognize dates beginning in the year 2000. This could result in system failures
or miscalculations which could cause personal injury, property damage,
disruption of operations, and/or delays in payment from the Company's customers,
all of which could materially adversely affect the Company's business, financial
condition or results of operations.
The problem also extends to many "non-IT" systems; that is, operating and
control systems that rely on embedded chip systems. In addition, like every
other business enterprise, the Company is at risk from Y2K failures on the part
of its major business counterparts, including third party vendors, as well as
potential failures in public and private infrastructure services, including
electricity, water, gas, transportation and communications.
System failures resulting from the Y2K problem could adversely affect
operations and financial results in all of the Company's business operations.
Failures may affect important operations as accounts payable, loan origination
and payroll operations, as well as other routine business operations.
11
<PAGE>
The Company has completed an assessment of its computer systems, to
identify computer hardware, software and process control systems that are not
Y2K compliant. The Company presently believes that its business-critical
computer systems, which are not presently Y2K compliant, will be replaced,
upgraded or modified prior to December 31, 1999. The costs of the Company's Y2K
compliance efforts are being funded with cash flows from operations and are
estimated to be approximately $250,000. The Company has a draft contingency plan
that is expected to be finalized by June 30, 1999.
The Company is in the process of surveying its significant vendors,
subcontractors, suppliers and financial institutions to assess the status of
their Y2K issues. Responses and non-responses will be evaluated over the next
quarter as part of the Company's Y2K plan. The Company cannot determine to what
extent the Y2K issue will affect its vendors, subcontractors, suppliers and
financial institutions and, consequently, the Company.
Based upon its efforts to date, the Company believes that the vast majority
of both its IT and its non-IT systems, including all critical and important
systems, will remain up and running after January 1, 2000. Accordingly, the
Company does not currently anticipate that internal systems failures will result
in any material adverse effect to its operations or financial condition. During
1999, the Company will also continue and expand its efforts to ensure that major
third-party vendors and providers of infrastructure services, such as utilities
and communications services, will also be prepared for the year 2000, and to
develop contingency plans if considered necessary to address any failures on
their part to become Y2K compliant. At this time, the Company believes that the
most likely "worst case" scenario involves potential disruptions in the areas in
which the Company's operations must rely on such third parties whose systems may
not work properly after January 1, 2000. While such failures could affect
important operations of the Company and its subsidiaries, either directly or
indirectly, in a significant manner, the Company cannot at the present time
estimate either the likelihood or the potential cost of such failures.
The foregoing assessment of the impact of the Y2K problem is based on
management's best estimate at the present time, and could change substantially.
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
Certain statements in this Form 10-Q report, as well as statements made by
the Company in periodic press releases, oral statements made by the Company's
officials to analysts and shareholders in the course of presentations about the
Company and conference calls following quarterly earnings releases, may be
construed as Forward-Looking Statements, as defined in the Private Securities
Litigation Reform Act of 1995. Such statements may involve unstated risks,
uncertainties and other factors that may cause actual results to differ
materially. Such risks, uncertainties and other factors include, but are not
limited to, changes in general economic conditions; fluctuations in interest
rates; increases in costs and materials, supplies and labor; and general
competitive conditions.
12
<PAGE>
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 filed a Current Report on Form 8-K with the
Securities and Exchange Commission on May 4, 1999 regarding the
acquisition of assets and assumption of liabilities of Breland
Homes, Inc., Breland Properties, Inc. and Breland Homes of
Mississippi, LLC. The financial statements required to be filed
with Form 8-K will be filed as soon as practicable but no later
than July 2, 1999.
13
<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: June 14, 1999 By: /s/ GEATON A. DECESARIS, JR.
-----------------------------------------
Geaton A. DeCesaris, Jr.
President and Chief Executive Officer
Date: June 14, 1999 By: /s/ CLAYTON W. MILLER
-----------------------------------------
Clayton W. Miller
Principal Accounting Officer
14
<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 APRIL 30, 1999 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> Jul-31-1999
<PERIOD-END> Apr-30-1999
<CASH> 9,682
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 136,045
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 174,713
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 79
<OTHER-SE> 64,425
<TOTAL-LIABILITY-AND-EQUITY> 174,713
<SALES> 229,909
<TOTAL-REVENUES> 232,786
<CGS> 186,865
<TOTAL-COSTS> 217,268
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 5,498
<INCOME-PRETAX> 10,020
<INCOME-TAX> 3,865
<INCOME-CONTINUING> 6,155
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,155
<EPS-BASIC> .77
<EPS-DILUTED> .75
</TABLE>
