-6-
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended
January 28, 1994
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 0-1667
Bob Evans Farms, Inc.
(Exact name of registrant as specified in its charter)
Delaware 31-4421866
(State or other jurisdiction of incorporation (I.R.S.
Employer
or organization) Identification No.)
3776 South High Street Columbus, Ohio 43207
(Address of principal executive offices)
(Zip Code)
(614) 491-2225
(Registrant's telephone number, including area code)
(Former name, former address and formal 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
As of the close of the period covered by this report, the
registrant had issued 42,638,118 common shares.
<TABLE>
BOB EVANS FARMS, INC.
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
<CAPTION>
(Dollars in Thousands)
January 28, 1994 April 30, 1993
Unaudited Audited
<S> <C> <C>
Current Assets
Cash $ 8,574 $ 8,241
Investments 58 1,947
Accounts receivable 12,857 12,545
Inventory 15,325 14,814
Deferred income taxes 4,249 4,249
Prepaid expenses 3,199 1,122
Total Current Assets 44,262 42,918
Property, Plant, and Equipment, at Cost 489,171 440,461
Less accumulated depreciation 155,406 139,695
Net Property, Plant and 333,765 300,766
Equipment
Other Assets
Deposits and other 1,413 2,163
Deferred income taxes 511 511
Cost in excess of net assets 11,690 12,094
acquired
Other intangible assets 2,137 2,374
Total Other Assets 15,751 17,142
$ 393,778 $ 360,826
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Short-term line of credit $ 3,500
Accounts payable 9,224 $ 9,530
Dividends payable 2,838 2,618
Federal and state income taxes 3,235 7,597
Accrued wages and related 10,428 10,163
liabilities
Other accrued expenses 19,013 14,936
Total Current Liabilities 48,238 44,844
Long-Term Liabilities
Deferred income taxes 6,682 6,682
Stockholders' Equity
Common stock, $.01 par value
Authorized: 100,000,000 shares;
issued 42,638,118 shares
at January 28, 1994, and April 30,
1993 426 426
Capital in excess of par value 144,248 144,339
Retained earnings 202,086 174,169
346,760 318,934
Less treasury stock: 597,909
shares at January 28, 1994 and
736,428 shares
at April 30, 1993, at cost 7,902 9,634
Total Stockholders' Equity 338,858 309,300
$393,778 $360,826
The accompanying notes are an integral part of the financial
statements.
</TABLE>
<TABLE>
BOB EVANS FARMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
UNAUDITED
(Dollars in Thousands Except Net Income
Per Share and Cash Dividend Amounts)
<CAPTION>
Three Months Ended Nine Months Ended
Jan. 28, 1994 Jan. 29, 1993 Jan. 28, 1994 Jan. 29, 1993
<S> <C> <C> <C> <C>
Sales $166,625 $169,543 $522,094 $492,647
Cost of goods sold 126,365 128,460 397,039 374,277
40,260 41,083 125,055 118,370
Selling and administrative 21,017 22,753 67,174 65,457
expenses
19,243 18,330 57,881 52,913
Other income (expense), net 80 21 (8) (441)
Income before income 19,323 18,351 57,873 52,472
taxes
Federal and state income 7,119 6,908 21,445 19,612
taxes
Net income $ 12,204 11,443 36,428 32,860
Weighted average number 41,991,072 41,865,869 41,991,072 41,865,869
of common shares
outstanding
Net income per common share
based upon the weighted
average number of
common shares $.29 $.27 $.87 $.78
Cash dividend per common $.068 $.063 $.203 $.188
share
The accompanying notes are an integral part of the financial statements.
</TABLE>
<TABLE>
BOB EVANS FARMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
UNAUDITED
<CAPTION>
(Dollars in Thousands)
Nine Months Ended
January 28, 1994 January 29, 1993
<S> <C> <C>
Operating activities:
Net income $36,428 $32,860
Adjustments to reconcile net income to
net cash provided by operating
activities:
Depreciation and amortization 17,469 15,650
Loss (gain) on sale of property and 84 (53)
equipment
Compensation expense attributable
to stock options 1,382
Cash provided by (used for) current
assets
and current liabilities:
Accounts receivable (312) 670
Inventories (511) 649
Prepaid expenses (2,077) 1,767
Accounts payable (306) (4,403)
Federal and state income taxes (4,362) (1,633)
Accrued wages and related 265 (1,228)
liabilities
Other accrued expenses 4,077 1,178
Net cash provided by 50,755 46,839
operating activities
Investing activities:
Investment in Greenriver Charcoal, Inc. (3,046)
Purchase of property, plant and (50,225) (36,070)
equipment
Proceeds from sale of investments 19,927 15,573
Purchase of short-term investments (18,038) (8,550)
Proceeds from sale of property, plant 314 419
and equipment
Other 750 (737)
Net cash used in investing (47,272) (32,411)
activities
Financing activities:
Cash dividends paid (8,292) (7,430)
Purchase of treasury stock (273)
Short-term line of credit:
Proceeds 3,500 5,000
Principal payments (5,000)
Payments on long-term debt (1,600)
Distribution of treasury stock and
issuance of common stock due to the
exercise of stock options and employee
bonuses 1,642 1,101
Net cash used in financing (3,150) (8,202)
activities
Increase (decrease) in cash 333 6,226
Cash at the beginning of the period 8,241 1,439
Cash at the end of the period $ 8,574 $ 7,665
The accompanying notes are an integral part of the financial
statements.
</TABLE>
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
UNAUDITED
1. Unaudited Financial Statements
The accompanying unaudited financial statements are
presented in accordance with the requirements of Form 10-Q
and, consequently, do not include all of the disclosures
normally required by generally accepted accounting
principles, or those normally made in the Company's Form
10-K filing. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered
necessary for a fair presentation have been included. No
significant changes have occurred in the disclosures made in
Form 10-K for the fiscal year ended April 30, 1993 (refer to
Form 10-K for a summary of significant accounting policies
followed in the preparation of the consolidated financial
statements).
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
Sales
Third quarter net sales for Bob Evans Farms, Inc. decreased
2% compared to the corresponding quarter a year ago. This
decrease was composed of a $448,000 (less than 1%) decline in the
restaurant segment, and a $2,470,000 (4%) decline in the food
products segment. These decreases were due to one less week in
the third quarter this year as compared to the prior year, as
well as the unusually severe weather experienced across much of
the Bob Evans core marketing area this past quarter.
For the nine-month period ended January 28, 1994,
consolidated net sales increased 6% compared to the corresponding
period a year ago. This increase reflected a 7% rise in
restaurant segment sales and a 3% rise in food products segment
sales. The improvement in restaurant sales was a result of more
restaurants in operation in addition to a 3% weighted average
menu price increase. Seven new restaurants were opened in the
third quarter, bringing the total number of restaurants in
operation to 303 compared with 281 a year ago. The 3% increase
in food products sales was the result of improved sales of our
charcoal, liquid smoke, and salad products.
Cost of Goods Sold
As a percentage of sales, consolidated cost of goods sold
remained unchanged at 76% for both the third quarter and the nine-
month period ended January 28, 1994, as compared to the
corresponding periods a year ago.
Within the restaurant segment, gross margin was unchanged in
the third quarter, but increased nearly 1% for the nine-month
period ended January 28, 1994 as a result of controlling
operating costs. The food products gross margin was also
unchanged in the third quarter, but decreased 1% for the nine-
month period ended January 28, 1994 due mostly to the higher cost
of live hogs as well as the higher cost of fresh salad
ingredients.
Selling and Administrative Expenses
Selling and administrative expenses decreased 8% for the
three-month period and increased 3% for the nine-month period
ended January 28, 1994, compared to the corresponding periods a
year ago. The third quarter decrease was the result of one less
week of operations. For both the third quarter and year-to-date,
selling and administrative expenses as a percentage of sales were
unchanged at 13%.
Other Income and Expenses
Other income and expense in the third quarter netted to a
gain of $80,000 compared to $21,000 a year ago. For the nine
months ended January 28, 1994, other income and expense netted to
a loss of $8,000 compared to a loss of $441,000 in the
corresponding period a year ago. Most of the improvement
resulted from gains on the sale of property.
Net Income
Compared to the prior year, net income increased 7% and 11%
for the three-month and nine-month periods, respectively, ended
January 28, 1994. These increases were due to more restaurants
in operation, as well as improved profit margins in restaurant
segment core stores and food products segment sausage products.
The food products net margin in the third quarter improved
because of higher wholesale prices of our sausage products over a
year ago.
Liquidity and Capital Resources
The company continues to maintain a strong financial
position and relies on cash and short-term investments as a
principal source of liquidity. Cash generated from both the
restaurant segment and food products segment is used to satisfy
working capital requirements and to fund capital expenditures.
Also, the company has available bank lines of credit of
$18,000,000 for short-term cash needs if required. At January
28, 1994, $3.5 million was outstanding under such lines of
credit.
PART II OTHER INFORMATION
ITEM 4. Submission of Matters to a Vote of Security
Holders
None
ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits
None
(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.
Bob Evans Farms, Inc.
Registrant
/s/ Daniel E. Evans
Daniel E. Evans
Chairman of the Board
(Chief Executive Officer)
/s/ Donald J. Radkowski
Donald J. Radkoski
Group Vice President and Treasurer
(Chief Financial Officer)
March 3, 1994
Date
