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 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 33-57505
______________________________________________
Roundy's,Inc.
____________________________________________________________________
(Exact name of registrant as specified in its charter)
Wisconsin 39-0854535
____________________________________________________________________
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
23000 Roundy Drive, Pewaukee, Wisconsin 53072
____________________________________________________________________
(Address of principal executive offices) (Zip Code)
(414) 547-7999
____________________________________________________________________
(Registrant's telephone number, including area code)
NOT APPLICABLE
_____________________________________________________________________
(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 June 28, 1997
_____________________________ ____________________________
Common Stock, $1.25 par value
Class A (Voting) 13,000 Shares
Class B (Non-voting) 1,140,995 Shares
ROUNDY'S, INC.
INDEX
Page No.
PART I. Financial Information: ________
Consolidated Balance Sheets -
June 28, 1997 and December 28, 1996 3
Statements of Consolidated Earnings -
Thirteen Weeks and Twenty-six Weeks
Ended June 28, 1997 and June 29, 1996 4
Statements of Consolidated Cash Flows -
Twenty-six Weeks Ended June 28, 1997
and June 29, 1996 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
PART I. FINANCIAL INFORMATION
ROUNDY'S, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
June 28, 1997 and December 28, 1996
June 28, 1997 December 28, 1996
(Unaudited) (Audited)
------------- -----------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents.............. $ 57,159,500 $ 40,342,300
Notes and accounts receivable, less
allowance for losses, $5,378,900
and $6,314,700, respectively........ 88,254,800 98,593,300
Merchandise inventories................ 156,847,500 155,562,300
Prepaid expenses....................... 2,791,100 2,741,000
Refundable and future income tax
benefits............................. 7,817,400 7,817,400
------------ -------------
Total Current Assets............... 312,870,300 305,056,300
------------ ------------
OTHER ASSETS:
Notes receivable, less allowance
for losses of $5,576,000........... 11,648,000 12,386,600
Goodwill and other assets.............. 11,692,800 12,100,600
Other real estate...................... 5,468,100 4,439,700
Deferred income tax benefit............ 1,922,000 1,922,000
------------ ------------
Total Other Assets................. 30,730,900 30,848,900
------------ ------------
PROPERTY AND EQUIPMENT - Net............ 96,699,400 98,735,800
------------ ------------
$440,300,600 $434,641,000
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current maturities of long-term debt.. $ 10,172,500 $ 10,225,800
Accounts payable...................... 153,010,100 159,038,100
Accrued expenses...................... 47,645,900 44,358,400
Income taxes.......................... 5,086,100 936,100
------------ ------------
Total Current Liabilities........... 215,914,600 214,558,400
------------ ------------
LONG-TERM DEBT, LESS CURRENT MATURITIES 92,402,200 93,614,600
OTHER LIABILITIES....................... 16,581,100 16,522,700
------------ ------------
Total Liabilities.................. 324,897,900 324,695,700
------------ ------------
REDEEMABLE CLASS B COMMON STOCK......... 6,011,400 6,217,100
------------ ------------
STOCKHOLDERS' EQUITY:
Common Stock:
Voting (Class A)..................... 16,200 16,300
Non-Voting (Class B)................. 1,363,200 1,325,200
------------ ------------
Total Common Stock.................. 1,379,400 1,341,500
Amount related to recording minimum
pension liability...................... (232,800) (232,800)
Patronage dividends payable in common
stock.................................. 3,779,000
Additional paid-in capital.............. 28,938,100 24,920,600
Reinvested earnings..................... 80,437,800 75,051,100
------------ ------------
Total.............................. 110,522,500 104,859,400
Less Treasury Stock, at cost............ 1,131,200 1,131,200
------------ ------------
Total Stockholders' Equity......... 109,391,300 103,728,200
------------ ------------
$440,300,600 $434,641,000
============ ============
See Notes to Consolidated Financial Statements.
ROUNDY'S, INC. AND SUBSIDIARIES
<TABLE>
STATEMENTS OF CONSOLIDATED EARNINGS
FOR THE THIRTEEN WEEKS AND TWENTY-SIX WEEKS ENDED JUNE 28, 1997 AND
JUNE 29, 1996
(UNAUDITED)
<CAPTION>
Thirteen Weeks Ended Twenty-Six Weeks Ended
June 28, 1997 June 29, 1996 June 28, 1997 June 29,1996
------------- ------------- ------------- --------------
<S> <C> <C> <C> <C>
REVENUES:
Net sales and service fees.......... $634,137,900 $639,384,500 $1,251,636,900 $1,253,208,800
Other - net......................... 637,900 1,098,600 1,733,500 1,882,300
------------ ------------ -------------- --------------
634,775,800 640,483,100 1,253,370,400 1,255,091,100
------------ ------------ -------------- --------------
COSTS AND EXPENSES:
Cost of sales....................... 573,368,600 578,585,000 1,130,710,400 1,135,364,200
Operating and administrative........ 52,386,800 54,798,300 107,525,400 108,718,800
Interest............................ 2,012,700 2,138,900 4,029,500 3,942,400
------------ ------------ -------------- --------------
627,768,100 635,522,200 1,242,265,300 1,248,025,400
------------ ------------ -------------- --------------
EARNINGS BEFORE INCOME TAXES........ 7,007,700 4,960,900 11,105,100 7,065,700
PROVISION FOR INCOME TAXES.......... 2,855,600 2,021,600 4,525,300 2,879,300
------------ ------------ -------------- --------------
NET EARNINGS........................ $ 4,152,100 $ 2,939,300 $ 6,579,800 $ 4,186,400
============ ============ ============== ==============
<FN>
See Notes to Consolidated Financial Statements.
</TABLE>
ROUNDY'S, INC. AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CASH FLOWS
FOR THE TWENTY-SIX WEEKS ENDED JUNE 28, 1997 AND JUNE 29, 1996
(UNAUDITED)
Twenty-six Weeks Ended
June 28, 1997 June 29, 1996
------------- -------------
Cash Flows From Operating Activities:
Net earnings.......................... $ 6,579,800 $ 4,186,400
Adjustments to reconcile net earnings
to net cash provided by operating
activities:
Depreciation and amortization......... 8,392,400 7,475,600
Allowance for losses.................. 1,284,400 1,922,800
Loss (gain) on sale of assets......... 344,400 (264,000)
(Increase) Decrease in Operating Assets
Net of Effects of Business Acquisition:
Accounts receivable................... 9,054,100 (5,234,200)
Merchandise inventories............... (1,285,200) 1,680,300
Prepaid expenses...................... (50,100) 1,847,400
Refundable and future income tax
benefits............................ (515,700)
Other real estate..................... (1,028,400) 256,800
Goodwill and other assets............. (25,600) (154,900)
Increase(Decrease)in Operating Liabilities
Net of Effects of Business Acquisition:
Accounts payable...................... (6,028,000) (9,642,600)
Accrued expenses...................... 3,364,500 1,052,700
Income taxes.......................... 4,150,000 (583,600)
Other liabilities..................... 58,400 (550,300)
----------- -----------
Net cash flows provided by operating
activities............................. 24,810,700 1,476,700
----------- -----------
Cash Flows from Investing Activities:
Capital Expenditures.................. (7,752,900) (31,500,000)
Proceeds from sale of property and
equipment........................... 1,408,900 1,237,800
Payment for business acquisition net of
cash acquired....................... (12,602,900)
Decrease in notes receivable.......... 738,600 3,015,000
----------- -----------
Net cash flows used in investing
activities............................ (5,605,400) (39,850,100)
----------- -----------
Cash Flows from Financing Activities:
Proceeds from long-term borrowings.... 43,000,000
Principal payments of long-term debt.. (1,212,400) (1,259,300)
(Decrease) increase in current
maturities of long-term debt........ (53,300) 35,400
Proceeds from sale of common stock.... 696,400 498,200
Common stock purchased................ (1,818,800) (3,827,100)
----------- -----------
Net cash flows (used in) provided by
financing activities.................. (2,388,100) 38,447,200
----------- -----------
Net Increase (Decrease) in Cash and
Cash Equivalents...................... 16,817,200 73,800
Cash and Cash Equivalents,
Beginning of Period................... 40,342,300 26,382,000
----------- -----------
Cash and Cash Equivalents, End of Period $57,159,500 $26,455,800
=========== ===========
Cash paid during the period: - Interest $ 4,029,000 $ 3,810,100
- Income Taxes $ 457,600 $ 4,049,000
See Notes to Consolidated Financial Statements.
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 June 28, 1997 and
December 28, 1996, and the results of operations
for the thirteen and twenty-six weeks ended June
28, 1997 and June 29, 1996 and changes in cash
flows for the twenty-six weeks ended June 28, 1997
and June 29, 1996.
2) The results of operations for the thirteen and
twenty-six weeks ended June 28, 1997 and June 29,
1996 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.
4) Class B common stock which is subject to
redemption is reflected outside of stockholders'
equity. As of June 28, 1997 and December 28,
1996, 63,747 and 65,929 shares, respectively, were
subject to redemption. The Class B common stock
subject to redemption is payable over a five year
period based upon the book value at the preceding
fiscal year end.
5) During the six months ended June 29, 1996, the
Company concluded its consolidation of Cardinal
Foods into the Lima Division. The net cost of
this consolidation was $2.1 million.
6) In June 1997, the Financial Accounting Standards
Board issued statements No. 130 "Reporting
Comprehensive Income" and No. 131 "Disclosures
about Segments of an Enterprise and Related
Information." These statements will become
effective in 1998. The Company is currently
evaluating the impact of adopting these new
pronouncements.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
Results of Operations
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 June 28, 26 Weeks Ended June 28,
1997 & June 29, 1996 1997 & June 29, 1996
--------------------------------------------------
Increase/<Decrease> Increase/<Decrease>
----------------------- ----------------------
Net sales and service fees $(5,246,600) (0.8)% $(1,571,900) (0.1)%
Cost of sales (5,216,400) (0.9)% (4,653,800) (0.4)%
Operating and admin. expenses (2,411,500) (4.4)% (1,193,400) (1.1)%
Interest expense (126,200) (5.9)% 87,100 2.2%
Earnings before income taxes 2,046,800 41.3 % 4,039,400 57.2%
Net sales and service fees decreased approximately $5.2
million during the second quarter of 1997 as compared to the
second quarter of 1996. The loss of wholesale customers
resulted in a decrease of approximately $20.2 million. The
closing or sale of ten Company-owned stores resulted in a
decrease of approximately $9.4 million. New Company-owned
stores resulted in an increase of approximately $14.5
million. Sales by existing Company-owned stores decreased
$1.3 million. Sales to new and existing wholesale customers
increased $11.2 million.
Net sales and service fees decreased approximately $1.6
million during the first and second quarters of 1997 as
compared to the first and second quarters of 1996. The loss
of wholesale customers resulted in a decrease of
approximately $30.9 million. The closing or sale of eleven
Company-owned stores resulted in a decrease of approximately
$16.0 million. New Company-owned stores resulted in an
increase of approximately $31.4 million. Sales by existing
Company-owned stores increased $1.6 million. Sales to new
and existing wholesale customers increased $12.3 million.
Cost of sales approximated 90.4% and 90.5% of net sales and
service fees for the thirteen weeks ended June 28, 1997 and
June 29, 1996, respectively. Year-to-date cost of sales
approximated 90.3% and 90.6% of net sales and service fees
for the twenty-six weeks ended June 28, 1997 and June 29,
1996, respectively.
Operating and administrative expenses approximated 8.3% and
8.6% of net sales and service fees for the thirteen weeks
ended June 28, 1997 and June 29, 1996, respectively. Year-
to-date operating and administrative expenses approximated
8.6% and 8.7% of net sales and service fees for the twenty-
six weeks ended June 28, 1997 and June 29, 1996,
respectively. The decreases are primarily due to the costs
associated with the consolidation of Cardinal Foods into the
Lima Division incurred during the first and second quarters
of 1996 (See Note 5).
Interest expense decreased primarily as a result of lower
borrowing levels during the quarter ended June 28, 1997 as
compared to the quarter ended June 29, 1996.
No patronage dividends have been accrued as of June 28,
1997. 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% in 1997 and 1996.
Liquidity and Capital Resources
The Company's current ratio increased slightly from 1.42:1
at year-end to 1.45:1 at June 28, 1997. The consolidated
long-term debt to equity ratio has decreased from 0.85:1 at
December 28, 1996 to 0.80:1 at June 28, 1997, primarily due
to increased equity levels.
Stockholders' equity, including redeemable common stock,
increased approximately $5.5 million due to reinvested
earnings of $6.6 million, proceeds from the sale of common
stock of $0.7 million and offset by common stock purchases
of $1.8 million.
II. OTHER INFORMATION
ITEM 4. Exhibits and Reports on Form 8-K
(a) Matters were submitted to a vote of the holders of the
Company's Class A common stock at the Company's
annual meeting on April 15, 1997. A meeting of the
Trustees of Roundy's, Inc. Voting Trust was also
held on April 15, 1997.
(b) At the annual meeting, Charles R. Bonson was
elected as a retailer director. At the meeting of
the Trustees, Robert E. Bartels was elected as a
non-retailer non-management director and Robert D.
Ranus as a management director. All of these
votes were unanimous since all of the Class A
common stock is held in a voting trust and the
trustees are required to vote the Class A common
stock as a block. The following directors
continue in office: Lloyd E. Coppersmith, Gary N.
Gundlach, George C. Kaiser, Gerald F. Lestina,
Patrick D. McAdams, Henry Karbiner Jr. and Brenton
H. Rupple.
ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits
(b) Reports on Form 8-K -- There were no reports on
Form 8-K filed for the thirteen weeks ended June
28, 1997.
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 12, 1997 ROBERT D. RANUS
--------------- ----------------------------
Robert D. Ranus
Vice President and
Chief Financial Officer
(Principal Financial Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ROUNDY'S,
INC. FORM 10-Q FOR THE QUARTER ENDING JUNE 28, 1997 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JAN-03-1998
<PERIOD-END> JUN-28-1997
<CASH> 57,159,500
<SECURITIES> 0
<RECEIVABLES> 88,254,800
<ALLOWANCES> 0
<INVENTORY> 156,847,50
<CURRENT-ASSETS> 312,870,300
<PP&E> 193,213,539
<DEPRECIATION> 96,514,097
<TOTAL-ASSETS> 440,300,600
<CURRENT-LIABILITIES> 215,914,600
<BONDS> 92,402,200
0
0
<COMMON> 1,379,400
<OTHER-SE> 108,011,900
<TOTAL-LIABILITY-AND-EQUITY> 440,300,600
<SALES> 1,251,636,900
<TOTAL-REVENUES> 1,253,370,400
<CGS> 1,130,710,400
<TOTAL-COSTS> 1,130,710,400
<OTHER-EXPENSES> 106,241,000
<LOSS-PROVISION> 1,284,400
<INTEREST-EXPENSE> 4,029,500
<INCOME-PRETAX> 11,105,100
<INCOME-TAX> 4,525,300
<INCOME-CONTINUING> 6,579,800
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,579,800
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
