<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15 (d) of the Securities
Exchange Act of 1934
FOR THE FISCAL QUARTER ENDED FEBRUARY 27, 1999
COMMISSION FILE NUMBER 0-4173
DMI FURNITURE, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 41-0678467
(State of incorporation) (IRS employer ID number)
ONE OXMOOR PLACE, 101 BULLITT LANE, LOUISVILLE, KENTUCKY 40222
(Address of principal executive offices)
Registrant's telephone number with area code: (502) 426-4351 EXT.227
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 each of the Registrant's classes
of Common Stock as of the last practicable date:
CLASS - Common Stock, Par Value $.10 per Share
OUTSTANDING AT FEBRUARY 27, 1999 - 4,024,636
1
<PAGE>
INDEX
Part I. Financial Information PAGE
Consolidated Balance Sheets - February 27, 1999
and August 29, 1998 3, 4
Consolidated Statements of Income - Three and Six Months
Ended February 27, 1999 and February 28, 1998 5
Consolidated Statements of Cash Flows - Six Months Ended
February 27, 1999 and February 28, 1998 6, 7
Notes to Consolidated Financial Statements 8 -10
Management's Discussion and Analysis of Financial Condition
and Results of Operations 11-14
Part II. Other Information 15-16
Index to Exhibits
27. Financial Data Schedule 17
2
<PAGE>
PART I. FINANCIAL INFORMATION
DMI FURNITURE, INC.
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
<TABLE>
<CAPTION>
Feb. 27, Aug. 29,
ASSETS 1999 1998
- ------ ---- ----
<S> <C> <C>
Current assets:
Cash $ 577 $ 1,092
Accounts receivable - net 12,719 10,252
Inventories (Note 4) 16,275 16,296
Other current assets 426 341
Current portion of deferred income taxes (Note 2) 858 935
------- -------
Total current assets 30,855 28,916
Property, plant and equipment - at cost (Note 1) 22,634 22,459
Less accumulated depreciation 11,152 10,522
------- ------
Net property, plant and equipment 11,482 11,937
Other assets 459 476
------- ------
Total Assets $42,796 $41,329
------- ------
------- ------
</TABLE>
See accompanying notes.
3
<PAGE>
DMI FURNITURE, INC.
CONSOLIDATED BALANCE SHEETS
(Continued)
(Amounts in thousands)
<TABLE>
<CAPTION>
Feb. 27, Aug. 29,
LIABILITIES AND STOCKHOLDERS' EQUITY 1999 1998
- ------------------------------------ ---- ----
<S> <C> <C>
Current liabilities:
Trade accounts payable $ 2,975 $ 3,521
Accrued liabilities 2,552 3,128
Long-term debt due within one year 1,515 1,524
------- -------
Total current liabilities 7,042 8,173
Long-term liabilities:
Long-term debt 22,477 21,393
Accrued pension costs 735 807
Deferred compensation 258 273
Deferred income taxes (Note 2) 426 426
------- -------
23,896 22,899
Stockholders' equity:
Common stock 402 389
Additional paid-in capital 16,513 16,183
Retained deficit (4,794) (6,052)
Minimum pension liability (263) (263)
------- -------
Total stockholders' equity 11,858 10,257
------- -------
Total liabilities and stockholders' equity $42,796 $41,329
------- -------
------- -------
</TABLE>
See accompanying notes.
4
<PAGE>
DMI FURNITURE, INC.
STATEMENTS OF INCOME
(Amounts in thousands)
(Unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
-------------------- --------------------
FEB 27, FEB. 28, FEB. 27, FEB. 28,
1999 1998 1999 1998
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net sales $20,287 $12,785 $43,290 $30,224
Cost of sales 16,156 10,156 34,153 23,460
------- ------- ------- -------
Gross profit 4,131 2,629 9,137 6,764
Selling, general and
administrative expenses 3,087 2,238 6,217 4,808
------- ------- ------- -------
Operating profit 1,044 391 2,920 1,956
Interest expense (net) (441) (206) (894) (465)
------- ------- ------- -------
Income before income taxes 603 185 2,026 1,491
Provision for income taxes (Note 2) (229) (69) (767) (565)
------- ------- ------- -------
Net income $374 $116 $1,259 $926
------- ------- ------- -------
------- ------- ------- -------
Net income applicable to
common stock $374 $83 $1,259 $773
------- ------- ------- -------
------- ------- ------- -------
Earnings per common share (Note 3):
Basic $0.09 $0.03 $0.32 $0.24
------- ------- ------- -------
------- ------- ------- -------
Diluted $0.08 $0.02 $0.29 $0.15
------- ------- ------- -------
------- ------- ------- -------
</TABLE>
See accompanying notes.
5
<PAGE>
DMI FURNITURE, INC.
STATEMENTS OF CASH FLOWS
(Amounts in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
Feb. 27, Feb. 28,
1999 1998
------- --------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 1,259 $ 926
Adjustments to reconcile net income to
net cash provided (used) by
operating activities:
Depreciation and amortization 633 536
Deferred income taxes (Note 2) 77 56
Pension costs (72) (126)
Deferred compensation (15) (21)
Changes in assets and liabilities:
Accounts receivable (2,467) 1,467
Inventories 21 518
Other assets (69) (25)
Trade accounts payable (546) 414
Accrued liabilities (311) (862)
------- -------
Total adjustments (2,749) 1,957
------- -------
Net cash provided (used) by
operating activities (1,490) 2,883
------- -------
Cash flows (used) by investing activities:
Capital expenditures (178) (1,337)
------- -------
Cash used by investing activities (178) (1,337)
------- -------
</TABLE>
See accompanying notes.
6
<PAGE>
DMI FURNITURE, INC.
STATEMENTS OF CASH FLOWS
(Continued)
(Amounts in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
Feb. 27, Feb. 28,
1999 1998
------- --------
<S> <C> <C>
Cash flows provided (used) by financing activities:
Borrowings from line of credit 17,267 10,150
Payments on line of credit (15,550) (11,504)
Additions to long term debt - 1,016
Payments on long term debt (642) (577)
Restricted cash - (375)
Proceeds from stock options exercised 78 1
Dividends - (100)
------ ------
Cash provided (used) by financing activities 1,153 (1,389)
Decrease in cash (515) 157
Cash - beginning of period 1,092 512
------ ------
Cash - end of period $ 577 $ 669
------ ------
Cash paid for:
Interest $ 895 $ 509
------ ------
Income taxes $ 1,034 $ 813
------ ------
</TABLE>
See accompanying notes.
7
<PAGE>
DMI FURNITURE, INC.
Notes to Consolidated Financial Statements
(1) Financial Statements and Organization
The consolidated financial statements include DMI Furniture, Inc. and
its wholly owned subsidiary, DMI Management, Inc. ("Company"). The financial
statements included herein at February 27, 1999 and for the three and six
months ended February 27, 1999 and February 28, 1998 are unaudited but
include all adjustments which are, in the opinion of management, necessary to
a fair presentation of the results of operations and financial position for
the periods covered herein. These financial statements should be read in
conjunction with the financial statements and notes thereto included in the
Company's latest annual report on Form 10-K.
The results of operations for the interim periods are not necessarily an
indication of the results to be expected for the full 1999 fiscal year.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
The specific useful lives of property, plant, and equipment are as
follows:
Building and Leasehold Improvements 8 - 35 yrs.
Machinery and Equipment 3 - 13 yrs.
(2) Income Taxes
Income tax expense (benefit) consisted of the following (in thousands):
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
Feb. 27, Feb. 28, Feb. 27, Feb. 28,
1999 1998 1999 1998
----- ---- ---- ----
<S> <C> <C> <C> <C>
Current $ 206 $ 58 $ 690 $ 509
Deferred 23 11 77 56
------ ------- ----- -----
Total $ 229 $ 69 $ 767 $ 565
------ ------- ----- -----
------ ------- ----- -----
</TABLE>
8
<PAGE>
The provision for income taxes differs from that computed at the
federal statutory corporate tax rate as follows (in thousands):
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
Feb. 27, Feb. 28, Feb. 27, Feb. 28,
1999 1998 1999 1998
------- ------- ------- -------
<S> <C> <C> <C> <C>
Tax at 34% statutory rate $ 205 $ 63 $ 689 $ 507
State income taxes 24 6 78 58
----- ------ ----- -----
Income Taxes $ 229 $ 69 $ 767 $ 565
----- ------ ----- -----
----- ------ ----- -----
</TABLE>
(3) Earnings Per Common Share
In March 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 128, "Earnings Per Share" ("SFAS No.
128"). This standard modifies disclosure requirements for companies required
to report earnings per share ("EPS") to include presentations of Basic EPS
(which includes no dilution of common stock equivalents) and, if applicable,
Diluted EPS (which reflects the potential dilution of common stock
equivalents). The standard was effective for the Company with the completion
of its fiscal 1998 second quarter.
<TABLE>
<CAPTION>
(Thousands except per share amounts)
Three Months Ended Six Months Ended
Feb. 27, Feb. 28, Feb. 27, Feb. 28,
1999 1998 1999 1998
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net income $ 374 $ 116 $1,259 $ 926
Less: preferred stock dividends - (33) - (153)
------ ----- ------ ------
Net income applicable to common stock $ 374 $ 83 $1,259 $ 773
------ ----- ------ ------
------ ----- ------ ------
Average common shares outstanding 3,977 3,165 3,940 3,160
Common stock equivalents-dilutive
options (and convertible preferred
stock for Feb. 28, 1998) 506 2,918 460 2,920
------ ----- ------ ------
Average shares of common stock
and equivalents outstanding 4,483 6,083 4,400 6,080
------ ----- ------ ------
------ ----- ------ ------
Basic earnings per share $ .09 $ .03 $ .32 $ .24
(Net income applicable to common stock ------ ----- ------ ------
divided by average common shares ------ ----- ------ ------
outstanding)
Diluted earnings per share $ .08 $ .02 $ .29 $ .15
(Net income divided by average shares ------ ----- ------ ------
of common stock and equivalents ------ ----- ------ ------
outstanding)
</TABLE>
9
<PAGE>
On August 28, 1998 the Company retired its Series C Preferred Stock.
Of the 1,995,050 Series C shares outstanding, 1,557,593 shares were redeemed
for $3.00 per share by the Company as stated in its Certificate of
Incorporation, and 437,457 Series C shares were converted into 722,762 common
shares at the option of the holders. The redemption was funded through term
bank debt and cash.
(4) Inventories
Inventories were comprised of the following at February 27, 1999 and
August 29, 1998:
<TABLE>
<CAPTION>
FEB. 27, 1999 AUG. 29,1998
------------- ------------
<S> <C> <C>
Finished Products $10,705,000 $10,898,000
Work in Process 512,000 512,000
Raw Materials 5,058,000 4,886,000
------------- ------------
$16,275,000 $16,296,000
------------- ------------
------------- ------------
</TABLE>
(5) Major customers
The Company's customers include large furniture chain store retailers,
wholesale clubs, catalog retailers, and independent distributors, as well as
numerous smaller retailers. The Company's four largest customers accounted
for approximately 45% and 50% of the Company's total sales for the three and
six months periods, respectively, ended February 27, 1999. One customer,
Sam's Club, a division of Wal-Mart Stores, Inc., accounted for more than 10%
of the Company's total sales for the three and six month periods ended
February 27, 1999. The loss of one or more of these customers at the same
time could have a material adverse effect on the business of the Company. Six
customers accounted for approximately 51% of the Company's total sales in
fiscal 1998. As of February 27, 1999, one customer accounted for
approximately 31% of total accounts receivable, and the Company expects that
the account receivable from this particular customer will be collected in the
normal course of business.
10
<PAGE>
FORWARD-LOOKING STATEMENTS
The information set forth in "Management's Discussion and Analysis of
Financial Condition and Results of Operations," and in the other portions of
this report includes forward-looking statements about the Corporation and its
business. For this purpose, the use of words such as "believes,"
"anticipates," "plans," "expects," and similar expressions are intended to
identify forward-looking statements. Factors that realistically could cause
results to differ materially from those projected in the forward-looking
statements include the cyclical and seasonal nature of the furniture market;
the availability and cost of raw materials and labor; availability, terms and
deployment of capital; events that disrupt the flow of goods from off-shore
manufacturing sources; merchandising decisions by one or more of the
Company's major customers that adversely affect their purchases of the
Company's furniture products; changes in fashion or tastes that adversely
affect consumer perception of the Company's furniture products; general
conditions in the capital markets or in the general economy; demographic
changes that affect consumer purchases of furniture; competition; and other
factors identified in "Management's Discussion and Analysis of Financial
Condition and Results of Operations" below, in "Item 1. Business" of the
Company's 1998 Annual Report on Form 10-K, and in the Company's other filings
with the Securities and Exchange Commission.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Revenue - Net sales for the second quarter of fiscal 1999 ended February 27,
1999 increased approximately $7.5 million, or approximately 58% from the
second quarter of fiscal 1998. This increase was primarily the result of
increased sales of home office furniture, sales by the Company's Wynwood
division, and substantially increased sales to a major customer. This
increase was offset somewhat by decreased sales of promotional priced bedroom
furniture. Sales of home office furniture increased approximately 170%; and
sales of budget priced bedroom furniture decreased approximately 5%.
Shipments by the Company's Wynwood division exceeded 10% of total sales for
the quarter. This division was not yet shipping during the same quarter of
the previous year. Although the Company expects that sales growth for
comparable periods in the future is possible, the magnitude of any sales
increases for comparable periods in the future will likely be less than the
increases being reported for the three and six month periods in this report.
Net sales for the six months of fiscal 1999 ended February 27, 1999
increased approximately $13 million or approximately 43% from the first six
months of fiscal 1998. This increase was primarily the result of increased
sales of home office furniture, sales by the Company's Wynwood division, and
substantially increased sales to a major customer. This increase was offset
somewhat by decreased sales of promotional priced bedroom furniture and
commercial office furniture. Sales of home office furniture increased
approximately 102%; sales of budget priced bedroom furniture decreased
approximately 9%; and sales of commercial office furniture decreased
approximately 2%.
11
<PAGE>
Gross Margin - The Company's gross margin in the second quarter of fiscal
1999 was 20.4% compared to 20.6% in the second quarter of fiscal 1998. This
slight decrease in gross margin was primarily the result of lower production
levels in the Company's manufacturing plants due to reduced demand for the
furniture manufactured by those plants, as well as lower margin sales mix
than the previous year.
The Company's gross margin in the first six months of fiscal 1999
was 21.1% compared to 22.4% in the same period of fiscal 1998. This decrease
in gross margin was primarily the result of the same reasons mentioned in the
previous paragraph.
Selling, General and Administrative (S,G&A) Expense - For the second quarter of
fiscal 1999, S,G&A expense amounted to $3,087,000 or 15.2% of sales compared to
$2,238,000 or 17.5% of sales for the second fiscal quarter of 1998. This
decrease as a percent of sales is primarily the result of the fixed nature of a
majority of these expenses relative to the substantial sales increase.
For the first six months of fiscal 1999, S,G&A expense amounted to
$6,217,000 or 14.4% of sales compared to $4,808,000 or 15.9% of sales for the
same period of fiscal 1998. This decrease as a percent of sales is primarily
the result of the fixed nature of a majority of these expenses relative to
the substantial sales increase.
Operating Profit - For the second quarter of fiscal 1999, operating profit was
$1,044,000 or 5.1% of sales, compared to $391,000 or 3.1% of sales for the same
period of fiscal 1998. This increase was a result of the substantial sales
increase, and the lower S,G&A expenses as a percent of sales, offset slightly by
the .2% decline in gross profit margin. Although the Company expects that
operating profit growth for comparable periods in the future is possible, the
magnitude of any operating profit increases for comparable periods in the future
will likely be less than the increases being reported for the three and six
month periods in this report.
For the first six months of fiscal 1999, operating profit was $2,920,000
or 6.7% of sales, compared to $1,956,000 or 6.5% of sales for the same period
of fiscal 1998. This increase was a result of the substantial sales increase,
and the lower S,G&A expenses as a percent of sales, offset somewhat by the
decline in gross profit margin.
Interest Expense - For the second quarter of fiscal 1999, net interest was
$441,000 compared to $206,000 for the second quarter of fiscal 1998. This
increase was primarily the result of borrowings to finance higher levels of
accounts receivable and inventory to support the sales growth, as well as
borrowings to redeem the preferred stock in August 1998. Financing the
redemption with debt replaced non-tax deductible dividends on the preferred
stock with tax deductible interest. (See Note 3) During the first quarter of
fiscal 1999, the Company implemented the use of interest rate swaps as a cash
flow hedge to effectively fix the interest rate on part of its variable rate
debt. As of February 27, 1999, $8 million of the Company's variable rate debt
was subject to interest rate swaps.
For the first six months of fiscal 1999, net interest was $894,000
compared to $465,000 for the same period of fiscal 1998. The reasons for this
increase are the same as in the preceding paragraph.
12
<PAGE>
Liquidity and Capital Resources - Demands for funds relate to payments
for raw materials and other operating costs, debt obligations, and capital
expenditures. The Company's ability to generate cash adequate to meet short
and long-term needs is dependent on the collection of accounts receivable and
from its ability to borrow funds. The Company's days of sales outstanding of
accounts receivable averaged 56 days for the first six months of fiscal 1999
and 53 days for the same period of fiscal 1998. This increase was primarily
the result of significant amounts outstanding to a major customer that the
Company expects to collect in due course. The Company's average days of
inventory on hand averaged 89 days for the first six months of fiscal 1999
compared to 90 days for the same period of fiscal 1998.
Key elements of the Consolidated Statements of Cash Flows:
<TABLE>
<CAPTION>
Six Months
1999 1998
<S> <C> <C>
Net cash provided (used) by operating activities $(1,490,000) $2,883,000
Cash used for investing activities (178,000) (1,337,000)
----------- ---------
Net cash flows from operating and investing activities (1,668,000) 1,546,000
Cash provided (used) by financing activities 1,153,000 (1,389,000)
----------- ---------
Net change in cash and cash equivalents $ (515,000) $ 157,000
----------- ---------
----------- ---------
</TABLE>
During the first six months of fiscal 1999, the Company used cash flows
for operating activities of $1,490,000 compared to cash flows provided of
$2,883,000 the previous year. The comparatively strong operating cash flows
in the previous year are primarily due to a large decrease in accounts
receivable during the first six months of fiscal 1998 versus the accounts
receivable increase in the current year resulting from the significant sales
increase, particularly to one major customer. Investing activities required
$178,000 during the first six months of fiscal 1999 and $1,337,000 during the
first six months of fiscal 1998. The modest amount in the current year was
primarily for routine manufacturing plant improvement expenditures, and the
significant amount in the previous year was for the building project for the
new Wynwood division. Financing activities provided $1,153,000 during the
first six months of fiscal 1999 from the revolving line of credit, and
financing activities used $1,389,000 during the same period of fiscal 1998
primarily for payments on the revolving line of credit.
The Company is currently subject to claims under federal and state
environmental laws based on allegations that the Company had hazardous
substances disposed of at three waste disposal sites. After depositing
$57,000 in a trust fund under the terms of a tentative settlement of claims
arising from one site and paying its portion of preliminary investigation and
remediation costs at the other two sites, the Company retains a reserve of
approximately $43,000 against potential environmental liabilities. Due to the
limited nature of the Company's involvement in these environmental
proceedings, the availability of certain defenses, and the involvement of
many other parties with substantial financial resources in the proceedings,
the Company does not anticipate, based on currently available information,
that potential environmental liabilities arising from these proceedings are
likely to exceed the amount of the Company's reserve by an amount that would
have a material effect on the Company's financial condition, results of
operations or cash flows. Expenses for the year to date were not material.
13
<PAGE>
The Company does not believe any events are probable which would
materially change its present liquidity position, which is adequate to
satisfy known demands for funds for operations and to pay bank and other debt.
The Company has received certifications or representations from the
vendors of its critical hardware, system software, and application software
that those products are Year 2000 ready. The Company employs IBM AS400
hardware, IBM OS400 operating system, and MAPICS manufacturing and production
information control system for the large majority of its system needs, all of
which was subject to the above mentioned certifications. The Company has
tested this hardware and software and found its Year 2000 readiness to be as
certified. The Company has not incurred any material costs in its Year 2000
readiness plans nor does it anticipate any material costs in the future. The
Company has received representations or certifications from its largest
suppliers representing that they are Year 2000 compliant. In the event that
any of the Company's larger suppliers are not Year 2000 compliant, the
Company believes that a sufficient number of alternative sources exist to
allow the Company to meet its raw material needs. The Company has received
representations from customers representing approximately 50% of its annual
sales that those customers are Year 2000 compliant. The Company has received
representations from its primary depository and lender bank that they are
Year 2000 compliant. Even given best efforts and execution of the
aforementioned planning and testing, disruptions and unexpected business
problems may occur as a result of the Year 2000 issue.
14
<PAGE>
PART II. OTHER INFORMATION
Item 3. Legal Proceedings
The Company is a defendant in various lawsuits arising in the normal
course of business, including several environmental matters. The Company
presently retains a reserve of approximately $43,000 against potential
environmental liabilities. In management's opinion, these lawsuits are not
material to the results of operations or financial position of the Company,
or are adequately covered by insurance.
Item 4. Submission of Matters to a Vote of Security Holders
The Company held its annual meeting of security holders on February 3,
1999 at which security holders; (a) elected five directors of the Company for
the ensuing year, and, (b) ratified the appointment of Arthur Andersen LLP as
auditors for the 1999 fiscal year.
Results of the voting in connection with these items were as follows:
ELECTION OF DIRECTORS
<TABLE>
<CAPTION>
FOR % AGAINST %
<S> <C> <C> <C> <C>
Donald D. Dreher 3,200,267 81 3,055 0
Joseph G. Hill 3,200,170 81 3,152 0
Joseph L. Ponce 3,200,267 81 3,055 0
Thomas M. Levine 3,200,267 81 3,055 0
David M. Martin 3,200,267 81 3,055 0
</TABLE>
RATIFICATION OF ACCOUNTANTS
<TABLE>
<CAPTION>
FOR % AGAINST % ABSTAIN %
--- - ------- - ------- -
<S> <C> <C> <C> <C>
3,200,379 81 2,683 0 260 0
</TABLE>
There were 3,203,322 shares of Common Stock represented present in
person at the meeting constituting 82% of the 3,909,429 shares of Common
Stock outstanding, therefore a quorum was present at the meeting.
15
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
(a) EXHIBITS
27. Financial Data Schedule
(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.
DMI FURNITURE, INC.
(Registrant)
Date: March 31, 1999 /s/ JOSEPH G. HILL
--------------------------
Joseph G. Hill
Vice President-Finance,
Chief Financial Officer,
Secretary & Treasurer
16
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> AUG-28-1999
<PERIOD-START> AUG-30-1999
<PERIOD-END> FEB-27-1999
<CASH> 577
<SECURITIES> 0
<RECEIVABLES> 12942
<ALLOWANCES> 223
<INVENTORY> 16275
<CURRENT-ASSETS> 30855
<PP&E> 22634
<DEPRECIATION> 11152
<TOTAL-ASSETS> 42796
<CURRENT-LIABILITIES> 7042
<BONDS> 22477
0
0
<COMMON> 402
<OTHER-SE> 11456
<TOTAL-LIABILITY-AND-EQUITY> 42796
<SALES> 43068
<TOTAL-REVENUES> 43290
<CGS> 33908
<TOTAL-COSTS> 34153
<OTHER-EXPENSES> 6182
<LOSS-PROVISION> 35
<INTEREST-EXPENSE> 894
<INCOME-PRETAX> 2026
<INCOME-TAX> 767
<INCOME-CONTINUING> 1259
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1259
<EPS-PRIMARY> 0.32
<EPS-DILUTED> 0.29
</TABLE>
