<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
--- EXCHANGE ACT OF 1934
For the quarterly period ended July 31, 1999
----------------------
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
--- EXCHANGE ACT OF 1934
For the transition period from
----------------------
Commission File Number 0-17871
---------
EAGLE FOOD CENTERS, INC.
------------------------
(Exact name of registrant as specified in the charter)
Delaware 36-3548019
-------- ----------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
Rt. 67 & Knoxville Rd., Milan, Illinois 61264
- -------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (309) 787-7700
---------------
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
--- ---
The number of shares of the Registrant's Common Stock, par value one cent
($0.01) per share, outstanding at September 9, 1999 was 10,939,048.
Page 1 of 11 pages
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS
EAGLE FOOD CENTERS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
QUARTER ENDED TWO QUARTERS ENDED
JULY 31, AUGUST 1, JULY 31, AUGUST 1,
1999 1998 1999 1998
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Sales .................................. $ 234,434 $ 234,530 $ 465,178 $ 466,098
Cost of goods sold ..................... 173,501 174,860 344,863 348,704
------------ ------------ ------------ ------------
Gross margin ...................... 60,933 59,670 120,315 117,394
Operating expenses:
Selling, general and administrative 51,612 51,746 102,883 102,047
Store closing and asset revaluation -- -- 1,664 --
Depreciation and amortization ..... 5,083 4,360 9,887 8,737
------------ ------------ ------------ ------------
Operating income ................ 4,238 3,564 5,881 6,610
Interest expense ....................... 3,554 2,650 6,725 5,572
------------ ------------ ------------ ------------
Earnings (loss) before income taxes .... 684 914 (844) 1,038
Income taxes ........................... -- -- -- --
------------ ------------ ------------ ------------
Net earnings (loss) .................... $ 684 $ 914 $ (844) $ 1,038
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
Earnings (loss) per share:
Basic ............................. $ 0.06 $ 0.08 $ (0.08) $ 0.09
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
Diluted ........................... $ 0.06 $ 0.08 $ (0.08) $ 0.09
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
Weighted average shares and potential
common shares outstanding ............ 10,998,000 11,153,000 10,933,000 11,174,000
</TABLE>
See notes to consolidated financial statements.
2
<PAGE>
EAGLE FOOD CENTERS, INC.
CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
ASSETS
<TABLE>
<CAPTION>
JULY 31, JANUARY 30,
1999 1999
--------- ---------
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 13,801 $ 11,775
Restricted assets - marketable securities, at fair value 7,467 9,846
Accounts receivable, net of allowance for doubtful accounts
of $1.0 million in fiscal 1999 and $1.2 million in fiscal 1998 13,705 16,537
Income tax receivable 926 926
Inventories 68,344 74,069
Prepaid expenses 1,299 1,392
--------- ---------
Total current assets 105,542 114,545
Property and equipment (net) 150,136 132,364
Other assets:
Deferred debt issuance costs 376 585
Excess of cost over fair value of net assets acquired 2,285 2,325
Property held for resale 9,512 20,025
Other 14,900 13,471
--------- ---------
Total other assets 27,073 36,406
--------- ---------
Total assets $ 282,751 $ 283,315
--------- ---------
--------- ---------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 34,308 $ 47,434
Payroll and associate benefits 14,655 14,318
Accrued liabilities 19,867 25,353
Reserve for closed stores 1,302 1,302
Accrued taxes 6,641 7,795
Bank revolving credit facility -- --
Current portion of long-term debt 101,218 991
--------- ---------
Total current liabilities 177,991 97,193
Long-term debt:
Senior Notes -- 100,000
Capital lease obligations 55,809 37,779
--------- ---------
Total long-term debt 55,809 137,779
Other liabilities:
Reserve for closed stores 9,686 9,434
Other deferred liabilities 11,729 10,523
--------- ---------
Total other liabilities 21,415 19,957
Shareholders' equity:
Preferred stock, $.01 par value, 100,000 shares
authorized -- --
Common stock, $.01 par value, 18,000,000 shares
authorized, 11,500,000 shares issued 115 115
Capital in excess of par value 53,336 53,336
Common stock in treasury, at cost, 560,952 shares
and 581,202 shares (2,228) (2,309)
Accumulated other comprehensive income 14 47
Other (140) (140)
Retained earnings (deficit) (23,561) (22,663)
--------- ---------
Total shareholders' equity 27,536 28,386
--------- ---------
Total liabilities and shareholders' equity $ 282,751 $ 283,315
--------- ---------
--------- ---------
</TABLE>
See notes to consolidated financial statements.
3
<PAGE>
EAGLE FOOD CENTERS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
JULY 31, AUGUST 1,
1999 1998
-------- --------
<S> <C> <C>
Cash flows from operating activities:
Net earnings (loss) $ (844) $ 1,038
Adjustments to reconcile net earnings (loss) to net cash flows
from operating activities:
Depreciation and amortization 9,887 8,737
Store closing and asset revaluation 1,664 --
LIFO charge 500 500
Deferred charges and credits 360 1,207
Loss (gain) on disposal of assets 72 (1,111)
Change in assets and liabilities:
Receivables and other assets (180) (3,613)
Inventories 5,225 14,441
Accounts payable (13,126) 1,935
Accrued and other liabilities (5,635) (3,943)
Reserve for closed stores (649) (1,395)
-------- --------
Net cash flows from operating activities (2,726) 17,796
Cash flows from investing activities:
Additions to property and equipment (8,545) (6,891)
Additions to property held for resale (7,068) (8,413)
Maturities(purchases) of marketable securities, net 2,346 (378)
Cash proceeds from sale/leasebacks or dispositions of property and
equipment 42 14,245
Cash proceeds from sale/leasebacks or dispositions of property held
for resale 18,536 13,416
-------- --------
Net cash flows from investing activities 5,311 11,979
Cash flows from financing activities:
Net revolving credit repayment -- (7,208)
Deferred financing costs (32) (50)
Principal payments on capital lease obligations (527) (428)
-------- --------
Net cash flows from financing activities (559) (7,686)
-------- --------
Increase in cash and cash equivalents 2,026 22,089
Cash and cash equivalents at beginning of period 11,775 5,113
-------- --------
Cash and cash equivalents at end of period $ 13,801 $ 27,202
-------- --------
-------- --------
Supplemental disclosures of cash flow information:
Cash paid for interest $ 6,459 $ 5,396
Cash paid for income taxes $ 23 $ 85
Noncash investing and financing activities:
Unrealized loss on marketable securities $ (33) $ (15)
Additions to property and equipment and capital
lease liability in connection with sale/leaseback transactions $ 18,536 $ 23,544
</TABLE>
See notes to consolidated financial statements.
4
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
ACCOUNTING POLICIES
The accompanying unaudited financial statements have been prepared in accordance
with the summary of significant accounting policies set forth in the notes to
the audited financial statements contained in the Company's Form 10-K/A filed
with the Securities and Exchange Commission on May 6, 1999.
In the opinion of management, the accompanying unaudited financial statements
reflect all adjustments of a normal recurring nature necessary for a fair
statement of the results of operations and financial position for the interim
periods presented. Operating results for the thirteen weeks ended July 31, 1999
are not necessarily indicative of the results that may be expected for the
fiscal year ending January 29, 2000.
RESERVE FOR CLOSED STORES
During the second quarter of fiscal 1999, the Company added two stores to the
reserve. No charge was taken as all costs have been covered by favorable lease
terminations. During the first quarter of fiscal 1999, the Company added one
store to the reserve and recorded $1.7 million for estimated future store
closing costs. This charge included $900,000 for future lease costs and $800,000
of asset revaluations.
COMPREHENSIVE INCOME
Comprehensive income includes all changes in the Company's equity during the
period, except transactions with stockholders of the Company. Comprehensive
income consisted of the following (in thousands of dollars):
<TABLE>
<CAPTION>
Quarter Ended Two Quarters Ended
July 31, August 1, July 31, August 1,
1999 1998 1999 1998
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net earnings (loss) $ 684 $ 914 $ (844) $ 1,038
Other comprehensive income (loss):
Unrealized loss on marketable
securities (31) (35) (33) (15)
------- ------- ------- -------
Comprehensive income (loss) $ 653 $ 879 $ (877) $ 1,023
------- ------- ------- -------
------- ------- ------- -------
</TABLE>
LITIGATION
As reported in the Company's Form 10-Q for the first quarter of fiscal 1999, the
Company reached a settlement on May 21, 1999 of a lawsuit alleging
discrimination in employment which was filed against the Company in 1994 in the
United States District Court for the Central District of Illinois by two current
and one former associates individually and as representative of a class of all
individuals who are similarly situated. The settlement did not have a material
impact on financial results in the first quarter of 1999 since adequate
settlement costs were previously recorded. The Company denied all substantive
allegations of the Plaintiffs and of the class. The Company is subject to
various other unresolved legal actions which arise in the normal course of its
business. It is not possible to predict
5
<PAGE>
with certainty the outcome of these unresolved legal actions or the range of the
possible loss.
EARNINGS (LOSS) PER SHARE
Earnings (loss) per share ("EPS") are computed in accordance with Statement of
Financial Accounting Standards ("SFAS") No. 128, "Earnings per Share." Basic EPS
is computed by dividing consolidated net earnings (loss) by the weighted average
number of common shares outstanding. Diluted EPS is computed by dividing
consolidated net earnings (loss) by the sum of the weighted average number of
common shares outstanding and the weighted average number of potential common
shares outstanding. Potential common shares consist solely of outstanding
options under the Company's stock option plans. All outstanding options were
excluded from the earnings (loss) per share calculation for the two quarters
ended July 31, 1999 because they were anti-dilutive. The computation of basic
and diluted EPS is as follows:
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
QUARTER ENDED TWO QUARTERS ENDED
JULY 31, 1999 AUGUST 1, 1998 JULY 31, 1999 AUGUST 1, 1998
------------- -------------- ------------- --------------
<S> <C> <C> <C> <C>
Net earnings (loss) $ 684 $ 914 $ (844) $ 1,038
------- ------- ------- -------
------- ------- ------- -------
Weighted average common
shares outstanding 10,939 10,954 10,933 10,951
------- ------- ------- -------
------- ------- ------- -------
Basic EPS $ 0.06 $ 0.08 $ (0.08) $ 0.09
------- ------- ------- -------
------- ------- ------- -------
Weighted average common
shares outstanding 10,939 10,954 10,933 10,951
Effect of dilutive securities -
stock options 59 199 -- 223
------- ------- ------- -------
Shares applicable to diluted
earnings (loss) 10,998 11,153 10,933 11,174
------- ------- ------- -------
------- ------- ------- -------
Diluted EPS $ 0.06 $ 0.08 $ (0.08) $ 0.09
------- ------- ------- -------
------- ------- ------- -------
</TABLE>
SUBSEQUENT EVENTS
The Company closed two stores subsequent to the second quarter of fiscal 1999.
This will not result in a third quarter charge to earnings since the store
closing expenses were previously reserved.
6
<PAGE>
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
RESULTS OF OPERATIONS
Sales for the Company's second fiscal quarter ended July 31, 1999 were $234.4
million, a decrease of $96,000 or 0.04% from the second quarter of fiscal 1998.
Same store sales for the quarter decreased 3.0%. There were 90 stores operating
at the end of the second quarter of 1999 compared to 89 stores at the same point
in the prior year. For the two quarters ended July 31, 1999, sales were $465.2
million, a decrease of $920,000, or 0.2% compared to the same period in fiscal
1998. Same store sales for the two quarters declined 2.7%. The decline in total
and same store sales was due to increases in competitive store activity during
the past year.
The gross margin rate was 26.0% of sales for the quarter ended July 31, 1999
compared to 25.4% in the comparable quarter of 1998. For the two quarters ended
July 31, 1999, the gross margin rate was 25.9% compared to 25.2% for the same
period a year ago. The increase in the gross margin rate is primarily related to
the benefits of new systems and better purchasing and marketing practices during
the quarter and two quarters ended July 31, 1999.
Selling, general and administrative expenses for the second quarter of 1999 were
$51.6 million, or 22.0% of sales, compared to $51.7 million, or 22.0% of sales,
in the comparable quarter of 1998. For the two quarters ended July 31, 1999,
selling, general and administrative expenses were $102.9 million, or 22.1% of
sales, versus $102.0 million, or 21.9% of sales, for the same period in 1998.
This increase for the two quarters ended July 31, 1999 is due primarily to a
gain of $1.0 million on the sale of the bakery operations in the first quarter
of 1998.
The Company recorded a store closing and asset revaluation charge of $1.7
million during the first quarter of fiscal 1999 to reflect the estimated future
lease costs and asset revaluations relating to one store added to the reserve
during the first quarter.
Depreciation and amortization expense increased to $5.1 million, or 2.2% of
sales, for the quarter ended July 31, 1999 compared to $4.4 million, or 1.9% of
sales, in the prior year. For the two quarters ended July 31, 1999, depreciation
and amortization expenses increased to $9.9 million, or 2.1% of sales, compared
to $8.7 million, or 1.9% of sales, for the same period in 1998. The increases
are primarily due to increased depreciation relating to the Company's capital
spending program.
Net interest expense in the quarter ended July 31, 1999 increased to $3.6
million, or 1.5% of sales, compared to $2.7 million or 1.1% of sales in the
comparable quarter of 1998. For the two quarters ended July 31, 1999 interest
expense increased to $6.7 million, or 1.4% of sales, compared to $5.6 million,
or 1.2% of sales in the prior year. The increases are due to increased interest
expense on capital lease obligations in fiscal 1999.
Net earnings for the second quarter of fiscal 1999 were $684,000 or $0.06 per
share on a diluted basis compared to $914,000 or $0.08 per share for the same
quarter of fiscal 1998. For the two quarters ended July 31, 1999 the net loss
was $844,000 or $0.08 per share on a diluted basis compared to earnings of $1.0
million or $0.09 per share for the comparable period of fiscal 1998. There was
no tax provision in either year as tax loss carryforwards were utilized.
7
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
Cash used by operating activities was $2.7 million for the two quarters ended
July 31, 1999 compared to cash provided of $17.8 million for the comparable two
quarters of 1998. Net loss and non-cash charges generated $11.6 million of cash
and working capital changes used $14.3 million, primarily due to a decrease in
accounts payable and accrued liabilities, offset partially by a decrease in
inventory levels. The Company believes that operating cash flows and other
sources of liquidity, including borrowings under its Bank Revolving Credit
Facility, will be adequate to meet the Company's anticipated requirements for
working capital, capital expenditures and interest payments for the foreseeable
future. There can be no assurance, however, that the Company's business will
continue to generate operating cash flows at or above current flows.
Capital expenditures, including property held for resale, were $10.5 million for
the quarter and $15.6 million for the two quarters ended July 31, 1999. Three
stores held for resale were sold and leased back providing $18.5 million of
proceeds during the two quarters ended July 31, 1999. Two new stores opened and
there was one store closing during the first half of fiscal 1999.
Working capital at July 31, 1999 was a negative $72.4 million and the current
ratio was 0.59 to 1 compared to $17.4 million and 1.18 to 1 at January 30, 1999.
The negative working capital is due to the Company reclassifying its $100
million in Senior Notes, due April 15, 2000, from Long-Term Debt to Current
Liabilities at July 31, 1999. The notes were classified as Long-Term Debt in the
Company's Form 10-Q for the first quarter ended May 1, 1999 which was filed on
June 14, 1999. The working capital at May 1, 1999 would have been negative $77.4
million and the current ratio 0.56 to 1 had the $100 million in Senior Notes
been reclassified to Current Liabilities. The Company has engaged an investment
banking firm to assist in the replacement of the Senior Notes.
At July 31, 1999 the Company had no borrowing against the Bank Revolving Credit
Facility and no letters of credit outstanding.
YEAR 2000 MATTERS
The Year 2000 issue is the result of computer programs being written using two
digits rather than four to define the applicable year. Any of the Company's
computer programs that have time-sensitive software may recognize a date using
"00" as the year 1900 rather than the year 2000. This could result in a system
failure or miscalculations causing inaccuracies and disruptions of operations,
including among other things, a temporary inability to process transactions,
send invoices, or engage in similar normal business activities. The Company is
dependent on computer hardware, software, systems and processes ("IT Systems")
and non-information technology systems such as telephones, clocks, scales,
refrigeration controllers and other equipment which may contain embedded
microprocessor technology ("Non-IT" Systems). These systems are used in several
critical operating areas including store and distribution operations, product
merchandising and procurement, inventory and labor management, and accounting
and administrative systems.
The Company has been engaged in a comprehensive project under the direction of
the Chief Executive Officer since June 1996 to upgrade or replace its IT Systems
and convert from mainframe to client/server technology. Addressing Year 2000
matters is an integral part of this process. The Company has phased in a
substantial number of computer systems and related programs over the past two
years, including financial systems, merchandising, distribution, store ordering,
time and attendance, and direct store delivery receiving. The Company is
currently in the process of upgrading or replacing various systems; including
payroll, human resources and
8
<PAGE>
personnel systems, store systems, purchasing and inventory control and warehouse
and distribution systems. The project will include testing all systems critical
for day-to-day operations.
The Company is requesting each of its hardware and software vendors for both the
new systems that it has installed or expects to install, as well as any systems
which it does not expect to replace, to certify that their systems are Year 2000
compliant. During the first quarter of fiscal 1999, the Company requested
certification, and is tracking responses, from companies it has a significant
business relationship with that their systems are Year 2000 compliant. In
addition, the Company is evaluating Year 2000 issues related to Non-IT systems.
The evaluation consists of developing an inventory of all such systems, testing
and taking corrective action on all detected deficiencies. The Company believes
that its efforts will result in Year 2000 compliance. However, if the Company's
new computer systems fail with respect to the Year 2000 issue, or if any
applications or embedded chips critical to the Company's operational processes
are overlooked, there could be a material adverse impact on the business
operations or financial performance of the Company. The Company cannot guarantee
that hardware and software vendors on whom it has relied will honor their
obligations with respect to Year 2000 compliance, or that other companies it has
a business relationship with will achieve Year 2000 compliance. Additionally,
there can be no assurance that the systems of other companies on which the
Company's systems rely will be converted timely, or that a failure to convert by
another company, or a conversion that is incompatible with the Company's
systems, would not have a material adverse effect on the business operations or
financial performance of the Company. Management believes that, should the
Company or any third party with whom the Company has a significant business
relationship have a Year 2000 related systems failure, the most significant
impact would likely be the inability to conduct operations due to a power
failure, to deliver inventory in a timely fashion, to receive certain products
from vendors, process payments or to process electronically customer sales at
the store level.
The Company is in the process of developing contingency plans to provide
alternatives to enable the Company's core business operations to continue in the
event of a Year 2000 failure in its systems or in the systems of other companies
with which it has a relationship. There can be no assurance that the systems of
other companies on which the Company's contingency plans rely will be converted
timely, or that a failure to convert by another company, or a conversion that is
incompatible with the Company's systems, would not also have a material adverse
effect on the business operations or financial performance of the Company. The
Company expects to complete the contingency plans during the 1999 calendar year.
The Company has expended approximately $17.8 million since June 1996 to upgrade
or replace the majority of systems and convert them to client/server technology,
and expects to incur an additional $2.2 million, for a total of $20.0 million,
to complete the remaining systems. In addition, the Company has entered into
operating leases for equipment with a fair market value of $2.0 million and has
purchased equipment for $3.2 million, and expects to purchase or lease
additional equipment with a fair market value of $1.8 million, for a total of
$7.0 million. This includes both Year 2000 upgrades or replacements and the
replacement of systems that are inefficient and in need of replacement
regardless of their Year 2000 readiness. The Company expects to finalize the
upgrade or replacement of all IT Systems, correct any detected deficiencies in
Non-IT Systems and achieve Year 2000 compliance by November 1999.
9
<PAGE>
SAFE HARBOR STATEMENTS UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995
The statements under Management's Discussion and Analysis of Financial
Condition and Results of Operations and the other statements in this Form 10-Q
which are not historical facts are forward looking statements. These forward
looking statements involve risks and uncertainties that could render them
materially different, including, but not limited to, the effect of economic
conditions, the impact of competitive stores and pricing, availability and costs
of inventory, the rate of technology change, the cost and uncertain outcomes of
pending and unforeseen litigation, the availability of capital, supply
constraints or difficulties, the effect of the Company's accounting policies,
the effect of regulatory and legal developments, adverse effects of failure to
achieve Year 2000 compliance and other risks detailed in the Company's
Securities and Exchange Commission filings.
PART II : OTHER INFORMATION:
ITEM 1 : LEGAL PROCEEDINGS Not Applicable
ITEM 2 : CHANGE IN SECURITIES AND USE OF PROCEEDS Not Applicable
ITEM 3 : DEFAULTS UPON SENIOR SECURITIES Not Applicable
ITEM 4 : SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At the Company's 1999 Annual Meeting of Shareholders on June 16, 1999, the
shareholders elected the following persons to its Board of Directors for a one
year term:
Paul D. Barnett
Peter B. Foreman
Steven M. Friedman
Robert J. Kelly
Alain M. Oberrotman
Jerry I. Reitman
William J. Snyder
In the matter of the election of directors, voting was as follows:
<TABLE>
<CAPTION>
For Withheld Abstained
--- -------- ---------
<S> <C> <C> <C>
Paul D. Barnett 10,546,149 38,602 353,797
Peter B. Foreman 10,547,221 37,530 353,797
Steven M. Friedman 10,548,221 36,530 353,797
Robert J. Kelly 10,540,308 44,443 353,797
Alain M. Oberrotman 10,548,821 35,930 353,797
Jerry I. Reitman 10,546,821 37,930 353,797
William J. Snyder 10,548,712 36,039 353,797
</TABLE>
In the matter of ratification of the appointment of Deloitte & Touche, LLP as
independent auditors, 10,560,544 votes were cast in favor of approval, 14,389
votes were cast against, and holders of 363,615 votes abstained.
All votes were in the majority, and thus the directors were declared elected and
the appointment of auditor proposal declared approved.
ITEM 5 : OTHER Not Applicable
ITEM 6 : EXHIBITS AND REPORTS ON FORM 8K
Exhibit 27 : Financial Data Schedule (see page 12)
10
<PAGE>
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized:
EAGLE FOOD CENTERS, INC.
Dated: September 14, 1999 /s/ Robert J. Kelly
---------------------------------
Robert J. Kelly
Chairman, Chief Executive Officer
and President
Dated: September 14, 1999 /s/ S. Patric Plumley
-----------------------------
S. Patric Plumley
Senior Vice President -Chief
Financial Officer and Secretary
11
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JAN-29-2000
<PERIOD-END> JUL-31-1999
<CASH> 13,801,000
<SECURITIES> 7,467,000
<RECEIVABLES> 15,631,000
<ALLOWANCES> 1,001,000
<INVENTORY> 68,344,000
<CURRENT-ASSETS> 105,542,000
<PP&E> 305,143,000
<DEPRECIATION> 155,007,000
<TOTAL-ASSETS> 282,751,000
<CURRENT-LIABILITIES> 177,991,000
<BONDS> 0
0
0
<COMMON> 115,000
<OTHER-SE> 27,421,000
<TOTAL-LIABILITY-AND-EQUITY> 282,751,000
<SALES> 465,178,000
<TOTAL-REVENUES> 465,178,000
<CGS> 344,863,000
<TOTAL-COSTS> 344,863,000
<OTHER-EXPENSES> 114,434,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 6,725,000
<INCOME-PRETAX> (844,000)
<INCOME-TAX> 0
<INCOME-CONTINUING> (844,000)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (844,000)
<EPS-BASIC> (0.08)
<EPS-DILUTED> (0.08)
</TABLE>
