UNITED STATES
SECURITIES AND EXCHANGE COMMMISSION
Washington, D.C. 20549
FORM 10-Q/A1
(Mark One)
/X/ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarter ended June 28, 1997
or
/ / Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from ............. to ...............
Commission file number 0-16126
SPIEGEL, INC.
(Exact name of registrant as specified in its charter)
Delaware 36-2593917
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3500 Lacey Road, Downers Grove, Illinois 60515-5432
(Address of principal executive offices) (Zip Code)
630-986-8800
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year, if changed
since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes [X] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
The number of shares outstanding of each of the issuer's classes of common
stock, as of August 8,1997 are as follows:
Class A non-voting common stock, $1.00 par value
14,627,104 shares
Class B voting common stock, $1.00 par value
103,483,298 shares.
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SPIEGEL, INC. AND SUBSIDIARIES
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements
Consolidated Balance Sheets, June 28, 1997 and December 28, 1996
Consolidated Statements of Earnings,
Three and Six Months Ended June 28, 1997 and June 29, 1996
Consolidated Statements of Cash Flows,
Six Months Ended June 28, 1997 and June 29, 1996
Notes to Consolidated Financial Statements
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Consolidated Balance Sheets
($000s omitted, except per share amounts)
<TABLE>
<CAPTION>
(unaudited)
June 28, December 28,
1997 1996
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<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 44,398 $ 86,917
Receivables, net 380,801 485,242
Inventories 514,207 502,209
Prepaid expenses 84,106 84,634
Refundable income taxes 49,275 16,991
Deferred income taxes 35,532 35,542
------------ ------------
Total current assets 1,108,319 1,211,535
Property and equipment, net 388,964 399,910
Intangibles, net 165,098 166,275
Other assets 189,535 167,905
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Total Assets $ 1,851,916 $ 1,945,625
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LIABILITIES and STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of debt $ 52,850 $ 89,292
Indebtedness to related parties -- 20,000
Accounts payable 172,553 270,973
Accrued liabilities:
Salaries and wages 22,414 36,636
General taxes 107,360 127,170
Allowance for returns 24,474 41,691
Other accrued liabilities 97,224 109,634
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Total current liabilities 476,875 695,396
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Long-term debt, excluding current maturities 771,150 676,656
Indebtedness to related parties 5,000 --
Deferred income taxes 52,036 52,024
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Total liabilities 1,305,061 1,424,076
Stockholders' equity:
Class A non-voting common stock,
$1.00 par value; authorized 16,000,000
shares; 14,624,104 shares issued and
outstanding at June 28, 1997 and 14,618,404
at December 28, 1996 14,624 14,618
Class B voting common stock,
$1.00 par value; authorized 104,000,000
shares; 103,483,298 shares issued and
outstanding at June 28, 1997 and
93,141,654 at December 28, 1996 103,483 93,142
Additional paid-in capital 271,480 211,828
Minimum pension liability (9,365) (9,365)
Retained earnings 166,633 211,326
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Total stockholders' equity 546,855 521,549
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Total liabilities and stockholders' equity $ 1,851,916 $ 1,945,625
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</TABLE>
[FN]
See accompanying notes to consolidated financial statements.
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Consolidated Statements of Earnings
($000s omitted, except per share amounts)
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 28, June 29, June 28, June 29,
1997 1996 1997 1996
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<S> <C> <C> <C> <C>
Net sales and other revenues:
Net sales $ 646,090 $ 623,870 $1,215,875 $1,213,331
Finance revenue 38,715 33,266 61,243 61,607
Other revenue 11,438 11,465 20,937 28,344
----------- ----------- ----------- -----------
696,243 668,601 1,298,055 1,303,282
Cost of sales and operating expenses:
Cost of sales, including buying and
occupancy expenses 434,764 408,225 835,699 812,117
Selling, general and administrative
expenses 264,844 246,465 505,584 481,096
----------- ----------- ----------- -----------
699,608 654,690 1,341,283 1,293,213
----------- ----------- ----------- -----------
Operating income (loss) (3,365) 13,911 (43,228) 10,069
Interest expense 16,152 21,195 32,522 42,701
----------- ----------- ----------- -----------
Earnings (loss) before income taxes (19,517) (7,284) (75,750) (32,632)
Income benefit (6,034) (3,987) (31,058) (15,014)
----------- ----------- ----------- -----------
Net earnings (loss) $ (13,483) $ (3,297) $ (44,692) $ (17,618)
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Net earnings (loss) per common share $ (0.11) $ (0.03) $ (0.39) $ (0.16)
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Weighted average number of common
shares outstanding 118,106,457 107,746,760 114,184,116 107,746,629
------------ ----------- ----------- -----------
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</TABLE>
[FN]
See accompanying notes to consolidated financial statements.
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Consolidated Statements of Cash Flows
($000s omitted)
(unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 28, June 29,
1997 1996
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<S> <C> <C>
Cash flows from operating activities
Net earnings (loss) $ (44,692) $ (17,618)
Adjustments to reconcile net earnings (loss)
to net cash provided by (used in)
operating activities:
Depreciation and amortization 41,583 41,248
Gain on sale of receivables (19,672) --
Change in assets and liabilities:
Increase (decrease) in sold customer
receivables (149,734) 30,000
Decrease in receivables, net 254,175 125,855
(Increase) decrease in inventories (11,998) 49,236
Decrease in prepaid expenses 527 12,487
Decrease in accounts payable (98,419) (80,365)
Decrease in accrued liabilities (63,660) (42,546)
Decrease in income taxes (32,262) (13,294)
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Total adjustments (79,460) 122,621
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Net cash provided by (used in) operating activities (124,152) 105,003
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Cash flows from investing activities:
Net additions to property and equipment (18,899) (18,352)
Net additions to other assets (12,519) (19,312)
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Net cash used in investing activities (31,418) (37,664)
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Cash flows from financing activities:
Issuance of debt 124,500 300,250
Payment of debt (81,448) (373,786)
Issuance of Class B common stock 69,972 --
Exercise of stock options 27 11
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Net cash provided by (used in)
financing activities 113,051 (73,525)
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Net change in cash and cash equivalents (42,519) (6,186)
Cash and cash equivalents at beginning of period 86,917 42,302
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Cash and cash equivalents at end of period $ 44,398 $ 36,116
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Supplemental cash flow information:
Cash paid during the year for:
Interest $ 32,856 $ 43,360
Income taxes $ 4,533 $ 2,077
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</TABLE>
[FN]
See accompanying notes to consolidated financial statements.
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Spiegel, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
($000s omitted, except per share amounts)
(unaudited)
(1) Basis of Presentation
The consolidated financial statements at June 28, 1997 are unaudited
and have been prepared from the books and records of the registrant in
accordance with generally accepted accounting principles and the rules
and regulations of the Securities and Exchange Commission. All adjustments
(consisting only of normal recurring accruals) which are, in the opinion
of management, necessary for a fair presentation of financial position
and operating results for the interim periods are reflected. These
financial statements should be read in conjunction with the consolidated
financial statements and the notes thereto included in the registrant's
most recent Annual Report on Form 10-K, which includes financial
statements for the year ended December 28, 1996. Due to the seasonality
of the registrant's business, the results for interim periods
are not necessarily indicative of the results for the year.
(2) Reclassifications
Certain prior period amounts have been reclassified to conform to the
current presentation.
(3) Indebtedness to related parties
In the second quarter of 1997, the Company made the final $20,000 principal
payment on the loan from the Company's majority shareholder, Spiegel
Holdings, Inc., which existed as of December 28, 1996. In addition,
the Company replaced $20,000 of the $25,000 loan from 3 Suisses BVG (a
wholly owned subsidiary of Otto Versand) received in the first quarter of
1997 with a term loan from an unrelated party. As of June 28, 1997, the
total indebtedness to related parties outstanding was $5,000, bearing
interest at a variable rate based on LIBOR plus a margin, due in its
entirety in August, 1999.
(4) Issuance of Class B common stock
On March 7, 1997, the Company issued 10,341,644 shares of Class B voting
common stock to its majority shareholder, Spiegel Holdings, Inc. The net
proceeds of $69,972 are being used primarily to fund capital needs,
including the continued expansion of Eddie Bauer.
(5) Gains on sale of customer receivables
In 1997, the Company implemented Statement of Financial Accounting
Standards No. 125, "Accounting for Transfers and Servicing of Financial
Assets and Extinguishments of Liabilities". Due to the revolving
nature of sales of customer receivables held by trusts, a pretax gain of
$19,672 was recognized under the provisions of this new accounting
standard in the second quarter. This gain is recorded as Finance
Revenue in the Consolidated Statements of Earnings.
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SIGNATURE
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.
SPIEGEL, INC.
<TABLE>
<CAPTION>
Signature Title Date
- ------------------------- ------------------------ ----------------
<C> <S> <C>
/s/ James W. Sievers Senior Vice President August 19, 1997
James W. Sievers (Chief Financial Officer)
/s/ D. L. Skip Behm Vice President - Controller August 19, 1997
D. L. Skip Behm (Chief Accounting Officer)
</TABLE>
