UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended July 2, 1994
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 2-66296
Roundy's, Inc.
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(Exact name of registrant as specified in its charter)
Wisconsin 39-0854535
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
23000 Roundy Drive, Pewaukee, Wisconsin 53072
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(Address of principal executive offices) (Zip Code)
(414) 547-7999
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(Registrant's telephone number, including area code)
NOT APPLICABLE
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(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___
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at July 2, 1994
- - ------------------------------ --------------------------------
Common Stock, $1.25 par value
Class A (Voting) 14,000 Shares
Class B (Non-voting) 1,173,950 Shares
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ROUNDY'S, INC.
INDEX
Page No.
PART I. Financial Information:
Consolidated Balance Sheets -
July 2, 1994 and January 1, 1994 3
Statements of Consolidated Earnings -
Thirteen Weeks and Twenty-six Weeks
Ended July 2, 1994 and July 3, 1993 4
Statements of Consolidated Cash Flows -
Twenty-six Weeks Ended July 2, 1994
and July 3, 1993 5
Notes to Consolidated Financial Statements 6
Management's Discussion and Analysis of
Financial Condition and Results of
Operations 7
PART II. Other Information 9
SIGNATURES 10
<PAGE>
PART I. FINANCIAL INFORMATION
ROUNDY'S, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
July 2, 1994 and January 1, 1994
July 2, 1994 January 1, 1994
(Unaudited) (Audited)
ASSETS ------------- ---------------
CURRENT ASSETS:
Cash and short-term investments....... $ 26,542,300 $ 25,845,600
Notes and accounts receivable, less
allowance for losses, $9,223,600
and $8,766,500, respectively........ 103,046,700 99,826,500
Merchandise inventories............... 165,348,300 153,169,500
Prepaid expenses...................... 4,458,700 6,956,800
Future income tax benefits............ 4,281,800 4,281,800
------------ ------------
Total Current Assets............... 303,677,800 290,080,200
------------ ------------
OTHER ASSETS:
Notes receivable...................... 15,566,000 14,894,700
Deferred expenses and other........... 14,561,600 15,228,100
------------ ------------
Total Other Assets................. 30,127,600 30,122,800
------------ ------------
PROPERTY AND EQUIPMENT - Net........... 64,185,600 59,889,100
------------ ------------
$397,991,000 $380,092,100
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes payable......................... $ 59,400 $ 139,600
Current maturities of long-term debt.. 8,691,700 8,920,700
Accounts payable...................... 153,143,600 130,187,600
Accrued expenses...................... 39,551,700 36,778,500
Income taxes.......................... 138,400 410,900
------------ ------------
Total Current Liabilities 201,584,800 176,437,300
LONG-TERM DEBT, LESS CURRENT MATURITIES 101,733,000 113,044,700
DEFERRED INCOME TAXES................... 600,000 600,000
OTHER LIABILITIES....................... 4,690,900 3,944,000
------------ ------------
Total Liabilities.................. 308,608,700 294,026,000
<PAGE> ------------ ------------
STOCKHOLDERS' EQUITY:
Common Stock:
Voting (Class A).................... 17,500 19,400
Non-voting (Class B)................ 1,467,400 1,425,400
Total Common Stock................. 1,484,900 1,444,800
------------ ------------
Amount related to recording minimum
pension liability..................... (308,700) (308,700)
Patronage dividends payable in
common stock.......................... 875,000 3,263,000
Additional paid-in capital............. 23,373,500 20,388,900
Reinvested earnings.................... 63,957,600 61,278,100
------------ ------------
Total Stockholders' Equity......... 89,382,300 86,066,100
------------ ------------
$397,991,000 $380,092,100
============ ============
See Notes to Financial Statements.
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<TABLE>
ROUNDY'S, INC. AND SUBSIDIARIES
===============================
STATEMENTS OF CONSOLIDATED EARNINGS
FOR THE THIRTEEN WEEKS AND TWENTY-SIX WEEKS ENDED JULY 2, 1994 AND
JULY 3, 1993
(UNAUDITED)
<CAPTION>
Thirteen Weeks Ended Twenty-Six Weeks Ended
July 2, 1994 July 3, 1993 July 2, 1994 July 3, 1993
------------ ------------ -------------- --------------
<S> <C> <C> <C> <C>
REVENUES:
Net sales and service fees............ $624,277,200 $635,410,400 $1,230,491,900 $1,226,639,600
Other - net........................... 544,800 504,400 1,220,900 1,279,100
------------ ------------ -------------- --------------
624,822,000 635,914,800 1,231,712,800 1,227,918,700
------------ ------------ -------------- --------------
COSTS AND EXPENSES:
Cost of sales......................... 566,346,200 575,790,800 1,116,504,100 1,110,212,900
Operating and administrative.......... 51,304,600 52,418,600 103,409,300 104,620,300
Interest.............................. 2,394,100 3,173,200 4,810,600 6,142,600
------------ ------------ -------------- --------------
620,044,900 631,382,600 1,224,724,000 1,220,975,800
------------ ------------ -------------- --------------
EARNINGS BEFORE PATRONAGE DIVIDENDS..... 4,777,100 4,532,200 6,988,800 6,642,900
PATRONAGE DIVIDENDS ......... .......... 1,250,000 1,250,000 1,250,000 1,250,000
------------ ------------ -------------- --------------
EARNINGS BEFORE INCOME TAXES............ 3,527,100 3,282,200 5,738,800 5,692,900
PROVISION FOR INCOME TAXES.............. 1,436,000 1,360,000 2,338,000 2,306,000
------------ ------------ -------------- --------------
NET EARNINGS............................ $ 2,091,100 $ 1,922,200 $ 3,400,800 $ 3,386,900
============ ============ ============== ==============
<FN>
See Notes to Financial Statements.
</TABLE>
<PAGE>
ROUNDY'S, INC. AND SUBSIDIARIES
===============================
STATEMENTS OF CONSOLIDATED CASH FLOWS
FOR THE TWENTY-SIX WEEKS ENDED JULY 2, 1994 AND JULY 3, 1993
(UNAUDITED)
Twenty-Six Weeks Ended
July 2, 1994 July 3, 1993
Cash Flows From Operating Activities: ------------- ------------
Net earnings.......................... $ 3,400,800 $ 3,386,900
Adjustments to reconcile net earnings
to net cash provided by operating
activities:..........................
Depreciation and amortization......... 6,347,900 6,602,500
Allowance for losses.................. 1,197,400 1,401,200
Gain on sale of assets................ (84,000) (77,700)
Patronage dividends payable in
common stock......................... 875,000 875,000
(Increase) Decrease in Operating Assets:
Accounts receivable................... (4,417,600) (19,082,400)
Merchandise inventories............... (12,178,800) (7,803,300)
Prepaid expenses...................... 2,498,100 (202,900)
Future income tax benefits............ (1,342,300)
Other real estate..................... (64,500) 85,400
Deferred expenses and other assets.... 515,800 86,900
Increase (Decrease) in Operating
Liabilities:
Accounts payable...................... 22,956,000 19,301,300
Accrued expenses...................... 2,773,200 (648,000)
Income taxes.......................... (272,500) (1,135,300)
Other liabilities..................... 746,900 123,500
------------- ------------
Net cash flows provided by (used in)
operating activities.................. 24,293,700 1,570,800
------------- -------------
Cash Flows from Investing Activities:
Capital Expenditures.................. (10,765,100) (7,931,700)
Proceeds from sale of property and
equipment........................... 419,900 197,900
Increase in notes receivable.......... (671,300) 252,300
------------- ------------
Net cash flows provided by (used in)
investing activities.................. (11,016,500) (7,481,500)
------------- ------------
Cash Flows from Financing Activities:
Proceeds from long-term borrowings.... 14,000,000
Principal payments of long-term debt.. (11,311,700) (6,986,300)
Increase (decrease) in notes payable
and current maturities of
long-term debt...................... (309,200) 7,312,900
Proceeds from sale of common stock.... 186,200 273,300
Common stock purchased................ (1,145,800) (1,996,000)
------------- ------------
Net cash flows provided by (used in)
financing activities.................. (12,580,500) 12,603,900
<PAGE> ------------- ------------
Net Increase (Decrease) in Cash and
Short-term Investments................ 696,700 6,693,200
Cash and Short-term Investments,
Beginning of Period................... 25,845,600 19,912,000
------------ ------------
Cash and Short-term Investments,
End of Period......................... $ 26,542,300 $ 26,605,200
============ ============
Cash paid during the period: - Interest $ 4,760,300 $ 5,697,200
- Income Taxes 2,160,700 4,873,600
See Notes to Financial Statements.
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------
1) In the opinion of the Company, the accompanying consolidated
financial statements contain all adjustments (consisting only of
normal recurring accruals) necessary to present fairly the financial
position as of July 2, 1994 and January 1, 1994, and the results of
operations for the thirteen and twenty-six weeks ended July 2, 1994
and July 3, 1993 and changes in cash flows for the twenty-six weeks
ended July 2, 1994 and July 3, 1993.
2) The results of operations for the thirteen and twenty-six weeks ended
July 2, 1994 and July 3, 1993 are not necessarily indicative of the
results to be expected for the full fiscal year.
3) Earnings per share are not presented because they are not deemed to
be meaningful.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
---------------------------------------
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
---------------------------------------------
Results of Operations
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The following is management's discussion and analysis of certain significant
factors which have affected the Company's results of operations during the
periods included in the accompanying statements of consolidated earnings.
A summary of the period to period changes in the principal items included in
the statements of consolidated earnings is shown below:
Comparison of
-----------------------------------------------
13 Weeks Ended 26 Weeks Ended
July 2, 1994 and July 2, 1994 and
July 3, 1993 July 3, 1993
-----------------------------------------------
Net sales and service fees $(11,133,200) (1.8)% $ 3,852,300 0.3%
Cost of sales (9,444,600) (1.6)% 6,291,200 0.6%
Operating and admin. expenses (1,114,000) (2.1)% (1,211,000) (1.2)%
Interest expense (779,100) (24.6)% (1,332,000) (21.7)%
Earnings before income taxes 244,900 7.5 % 45,900 0.8%
Net sales and service fees decreased approximately $11.1 million during the
second quarter of 1994 as compared to second quarter of 1993. The loss of
wholesale customers resulted in a decrease in sales of approximately $14.2
million. The sale of manufacturing facilities resulted in a decrease of
$10.1 million. The closing or sale of four Company-owned stores resulted in
a decrease of approximately $5.0 million. Sales to new and existing customers
increased $18.2 million.
Net sales and service fees increased approximately $3.9 million during the
first and second quarters of 1994 as compared to the first and second quarters
of 1993. The loss of wholesale customers resulted in a decrease in sales of
approximately $30.1 million. The sale of manufacturing facilities resulted
in a decrease of $18.3 million. The closing or sale of four Company-owned
stores resulted in a decrease of approximately $10.5 million. Sales to new
and existing wholesale customers increased $62.8 million.
Cost of sales approximated 90.7% and 90.6% of net sales and service fees for
the thirteen weeks ended July 2, 1994 and July 3, 1993, respectively.
Year-to-date cost of sales approximated 90.7% and 90.5% of net sales and
service fees for the twenty-six weeks ended July 2, 1994 and July 3, 1993,
respectively.
Operating and administrative expenses approximated 8.2% of net sales and
service fees for the thirteen weeks ended July 2, 1994 and July 3, 1993.
Year-to-date operating and administrative expenses approximated 8.4% and 8.5%
of net sales and service fees for the twenty-six weeks ended July 2, 1994 and
July 3, 1993, respectively.
Interest expense decreased primarily as a result of lower borrowing levels
during the twenty-six weeks ended July 2, 1994 as compared to the twenty-six
weeks ended July 3, 1993.
<PAGE>
Patronage dividends in the amount of $1,250,000 have been accrued as of
July 2, 1994 and July 3, 1993. The Company's By-Laws require that, to the
extent permitted by the Internal Revenue Code, patronage dividends be paid out
of earnings from business done with stockholder-customers in an amount which
will reduce net earnings of the Company to such amount as will result in a 10
percent increase in the book value of its common stock.
The income tax rate used for calculating the provision for income taxes for
the interim periods was 40.8% and 40.5% in 1994 and 1993, respectively.
Liquidity and Capital Resources
- - -------------------------------
The Company's current ratio decreased from 1.64:1 at year-end to 1.51:1 at
July 2, 1994. The consolidated long-term debt to equity ratio has decreased
from 1.31:1 at January 1, 1994 to 1.14:1 at July 2, 1994, primarily due to
lower borrowing levels.
Stockholders' equity increased approximately $3.3 million due to reinvested
earnings of $3.4 million, proceeds from the sale of common stock of $0.2
million and the 1994 patronage dividend payable in common stock of $0.9
million partially offset by common stock purchases of $1.2 million.
<PAGE>
II. OTHER INFORMATION
---------------------
ITEM 4. Submission of Matters to a Vote of Security Holders
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(a) Matters were submitted to a vote of the holders of the Company's
Class A common stock, through solicitation of proxies, at the
Company's annual meeting on April 15, 1994.
(b) At such meeting, Charles R. Bonson was elected as a retailer
director; Robert E. Bartels was elected as a non-retailer non-
management director and Robert D. Ranus was elected as a management
director. The following directors continue in office: John R.
Dickson, George C. Kaiser, Gerald F. Lestina, Gary N. Gundlach,
George E. Prescott and Brenton H. Rupple.
ITEM 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibits - none
(b) Reports on Form 8-K -- There were no reports on Form 8-K
filed for the thirteen weeks ended July 2, 1994.
<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.
ROUNDY'S, INC.
-------------------------
(Registrant)
Date: August 4, 1994 ROBERT D. RANUS
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Robert D. Ranus
Vice President and
Chief Financial Officer
(Principal Financial Officer)
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