<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES ACT OF 1934
----------------------
For the Quarter Ended Commission File No. 1-6695
- - --------------------- --------------------------
October 29, 1994
FABRI-CENTERS OF AMERICA, INC.
- - --------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Ohio 34-0720629
- - ------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
5555 Darrow Road
Hudson, Ohio 44236
- - ---------------------------------------- --------------------
(Address of principal executive offices) (Zip Code)
216 - 656 - 2600
- - -------------------------------
(Registrant's telephone number)
Indicate by check mark whether the registrant (1) has filed all
reports required to 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.
Shares of Common Stock outstanding at November 25, 1994: 9,230,996.
Sequential page 1 of 16
<PAGE> 2
<TABLE>
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
Fabri-Centers of America, Inc.
(Thousands of dollars)
<CAPTION>
October 29, January 29,
1994 1994
- - -------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 18,690 $ 7,715
Merchandise inventories 342,617 224,803
Prepaid expenses and other current assets 12,331 11,009
Deferred income taxes 6,693 4,123
-----------------------------------------
Total current assets 380,331 247,650
Property and equipment, at cost:
Land 1,986 1,966
Buildings 20,404 20,052
Furniture and fixtures 81,565 72,088
Leasehold improvements 33,309 26,195
-----------------------------------------
137,264 120,301
Less accumulated depreciation and amortization 52,708 44,668
-----------------------------------------
84,556 75,633
Mortgage receivable 7,739 7,926
Other assets 10,375 9,164
-----------------------------------------
Total assets $ 483,001 $ 340,373
=========================================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 126,217 $ 62,309
Accrued expenses 33,002 11,375
Accrued income taxes - 2,954
Net liabilities of discontinued operation - 3,557
-----------------------------------------
Total current liabilities 159,219 80,195
Long-term debt 110,000 45,500
Convertible subordinated debentures 56,983 56,983
Deferred income taxes 9,190 8,499
Other long-term liabilities 104 184
Shareholders' equity:
Common stock 988 975
Additional paid-in capital 72,519 70,598
Other (2,829) (1,896)
Retained earnings 85,222 87,602
-----------------------------------------
155,900 157,279
Treasury stock, at cost (8,395) (8,267)
-----------------------------------------
Total shareholders' equity 147,505 149,012
-----------------------------------------
Total liabilities and shareholders' equity $ 483,001 $ 340,373
=========================================
<FN>
See notes to consolidated financial statements
</TABLE>
Page 2 of 16
<PAGE> 3
<TABLE>
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
Fabri-Centers of America, Inc.
(Thousands of dollars, except share and per share data)
<CAPTION>
Thirteen weeks ended Thirty-nine weeks ended
------------------------------- ------------------------------
October 29, October 30, October 29, October 30,
1994 1993 1994 1993
- - ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net sales $ 175,434 $ 147,104 $ 420,961 $ 400,006
Costs and expenses:
Cost of goods sold 95,744 80,775 236,136 229,452
Selling, general and administrative expenses 70,611 58,934 183,001 171,687
Interest expense, net 2,453 1,737 5,694 4,596
--------------------------------------------------------------------
168,808 141,446 424,831 405,735
--------------------------------------------------------------------
Earnings (loss) before income taxes and cumulative effect of
accounting change 6,626 5,658 (3,870) (5,729)
Income tax provision (benefit) 2,551 2,122 (1,490) (2,148)
--------------------------------------------------------------------
Earnings (loss) before cumulative effect of accounting change 4,075 3,536 (2,380) (3,581)
Cumulative effect of accounting change - - - 399
--------------------------------------------------------------------
Net earnings (loss) $ 4,075 $ 3,536 $ (2,380) $ (3,182)
====================================================================
Earnings (loss) per common share:
Earnings (loss) before cumulative effect of
accounting change $ 0.44 $ 0.38 $ (0.26) $ (0.38)
Cumulative effect of accounting change - - - 0.04
--------------------------------------------------------------------
Net earnings (loss) $ 0.44 $ 0.38 (0.26) (0.34)
====================================================================
Average shares and equivalents outstanding 9,327,037 9,221,081 9,320,198 9,268,056
====================================================================
<FN>
See notes to consolidated financial statements
</TABLE>
Page 3 of 16
<PAGE> 4
<TABLE>
CONSOLIDATED STATEMENTS OF CASH FLOW (UNAUDITED)
Fabri-Centers of America, Inc.
(Thousands of dollars)
<CAPTION>
Thirty-Nine Weeks Ended
-----------------------------
October 29, October 30,
1994 1993
- - ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Operating activities:
Net loss $ (2,380) $ (3,182)
Additions (deductions) not requiring cash:
Cumulative effect of accounting change - (399)
Cancellation of restricted stock awards (10) (690)
Depreciation and amortization and other noncash expenses 9,830 8,842
Loss on disposal of fixed assets 243 532
Deferred income taxes (1,879) (3,605)
Working capital changes, net of acquisition of Cloth World:
Merchandise inventories (19,667) (36,402)
Prepaid expenses and other current assets 2,022 2,803
Accounts payable 35,749 18,007
Accrued expenses 540 (2,449)
Accrued income taxes (2,954) (971)
Net liabilities of discontinued operation (3,557) (7,558)
------------------------------
Net cash provided by (used for) operating activities 17,937 (25,072)
Investing activities:
Capital expenditures (8,202) (5,823)
Acquisition of Cloth World, net of cash acquired (a) (61,827) -
Mortgage receivable 187 310
Other, net (1,789) 240
------------------------------
Net cash used for investing activities (71,631) (5,273)
Financing activities:
Proceeds from long-term debt 89,500 46,000
Repayment of long-term debt (25,000) (9,900)
Other long-term liabilities (80) (36)
Proceeds from exercise of stock options 377 472
Repurchase of common stock (128) (3,230)
------------------------------
Net cash provided by financing activities 64,669 33,306
Net increase in cash 10,975 2,961
Cash and cash equivalents at beginning of period 7,715 6,627
------------------------------
Cash and cash equivalents at end of period $ 18,690 $ 9,588
==============================
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest $ 6,182 $ 6,140
Income taxes 3,189 529
(a) Acquisition of Cloth World, net of cash acquired
Working capital, other than cash $ (52,245) $ -
Property and equipment (9,540) -
Other assets (42) -
------------ ------------
$ (61,827) $ -
============ ============
<FN>
See notes to consolidated financial statements
</TABLE>
Page 4 of 16
<PAGE> 5
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
FABRI-CENTERS OF AMERICA, INC.
OCTOBER 29, 1994, JANUARY 29, 1994 AND OCTOBER 30, 1993
1. Basis of Presentation:
The accompanying consolidated financial statements include the accounts
of Fabri-Centers of America, Inc. and its wholly owned subsidiaries (the
"Company") and have been prepared without audit, pursuant to the rules of
the Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been
condensed or omitted pursuant to those rules and regulations, although the
Company believes that the disclosures herein are adequate to make the
information not misleading. The statements should be read in conjunction
with the consolidated financial statements and notes thereto included in
the Company's Annual Report on Form 10-K for the fiscal year ended January
29, 1994. The statements present the Company's Cargo Express Stores
division as a discontinued operation, accordingly, except as noted, the
statements pertain to only the Company's continuing operations.
In the opinion of Management, the accompanying consolidated financial
statements contain all adjustments (consisting only of normal recurring
accruals) necessary for a fair statement of results for the interim
periods.
2. Significant Accounting Policies:
A. Cash equivalents consist of highly liquid investments with a
maturity of three months or less at the time of purchase.
B. Inventories are stated at the lower of cost or market. Cost is
principally determined on the last-in, first-out (LIFO) method.
C. Store physical inventories are taken on a cycle basis throughout the
fiscal year, with an approximate equal percentage of stores
inventoried each fiscal quarter. Store inventories subsequent to
the physical inventory are charged at cost for shipments of
merchandise to the stores and are relieved at cost for the sale of
merchandise.
D. The expenses incurred in connection with the opening of new stores
are charged to operations in the period the store is opened.
E. Earnings per share are computed based on the weighted average
number of shares and share equivalents outstanding during the
fiscal period.
F. Depreciation of buildings, furniture and fixtures and leasehold
improvements is
Page 5 of 16
<PAGE> 6
provided by charges to operations on a straight-line basis over the
estimated useful lives of the assets. Accelerated methods of
depreciation are used for federal income tax purposes.
G. Certain reclassifications have been made of amounts reported in
fiscal 1994 in order to conform with the presentation for fiscal
1995.
H. The Company is a national specialty retailer of fabric and related
products through Company-operated retail stores. The stores sell
a wide variety of fashion and decorator fabrics, related notions,
patterns, crafts, seasonal and other merchandise.
3. Effective January 31, 1993, the Company adopted Statement of Financial
Accounting Standards (SFAS) No. 109, "Accounting for Income Taxes." As
permitted by SFAS 109, the Company elected not to restate the financial
statements for any prior years. The effect of the change on pre-tax
earnings from continuing operations for the thirty-nine weeks ended October
30, 1993, was not material; however, the cumulative effect of the change
increased net earnings by $399,000, or $0.04 per share, for the first
thirty-nine weeks of fiscal 1994.
4. As of January 29, 1994, the Company provided $5,201,000 net of tax benefit,
for the liquidation of its housewares division, Cargo Express Stores (Cargo
Express), primarily for the write-off of fixed assets, estimated costs to
complete the liquidation and estimated operating losses to be incurred
through completion of the liquidation. During the first quarter of fiscal
1995, the Company completed the liquidation of Cargo Express which did not
require the recognition of any additional gain or loss.
5. On September 30, 1994, the Company entered into a $200 million three-year
revolving credit agreement (the credit facility) with a group of eight banks
(the bank group). The Company pays a facility fee on the revolving credit
commitment amount and pays a commitment fee on the unused portion of the
credit facility each of which range from .125% to .25% based on the
achievement of certain financial covenants.
The credit facility contains certain financial covenants which limit the
Company's capital expenditures and defined leverage ratio, as well as,
require the Company to maintain a minimum defined current ratio, working
capital, tangible net worth, fixed charge coverage ratio and current funded
indebtedness ratio. As required by the credit facility, the Company entered
into a two-year interest rate protection agreement with one of the banks in
the bank group, fixing the interest rate to less than 8% on $20 million
notional amount. The maximum allowable combined outstanding debt for the
credit facility and additional bank borrowings is $220 million, subject to
further limitations during specified time frames throughout the commitment
period.
The Company's weighted average interest rate under its bank facilities was
6.07% for
Page 6 of 16
<PAGE> 7
the third quarter of fiscal 1995 and 5.14% during the thirty-nine weeks
ended October 29, 1994.
6. On October 2, 1994, the Company acquired substantially all of the assets
of Cloth World, a division of Brown Group Inc. ("Cloth World") for
approximately $100 million in cash and the assumption of certain
liabilities. The final purchase price is subject to post-closing
adjustments. The funds used to acquire Cloth World were provided by
internally generated funds and borrowings under the credit facility. The
acquisition has been recorded using the purchase method, and accordingly,
the results of operations of Cloth World have been included in the
Company's consolidated financial statements since the date of acquisition.
The purchase price allocation has been based on preliminary estimates
which may be revised at a later date; however, the effect of any revisions
on the results of operations for the third quarter of fiscal 1995 would
not be material.
Cloth World, with fiscal 1994 sales of $224 million, operated 342 specialty
fabric stores in 26 states with a concentration in the southern half of the
United States.
Summarized below are the unaudited consolidated results of operations of
the Company, including Cloth World on a pro forma basis, as if Cloth World
had been acquired as of the beginning of the periods presented:
<TABLE>
<CAPTION>
Thirty-nine weeks ended
----------------------------
October 29, October 30,
1994 1993
------------ ------------
<S> <C> <C>
Net sales $ 561,377 $ 568,235
Loss before cumulative effect of
accounting change $ (2,566) $ (3,135)
Net loss $ (2,566) $ (2,736)
Loss per common share:
Loss before cumulative effect of
accounting change $ (0.28) $ (0.34)
Net loss $ (0.28) $ (0.30)
</TABLE>
The pro forma financial information is presented for informational purposes
only and is not necessarily indicative of the operating results that would
have occurred had the Cloth World acquisition been consummated at the
beginning of the periods presented. In addition, they are not intended to
be a projection of future results and do not reflect synergies that might be
achieved from combined operations.
Page 7 of 16
<PAGE> 8
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Except where otherwise noted, Management's Discussion and Analysis of
Financial Condition and Results of Operations pertains to the Company's
continuing operations. Assets and liabilities of Cargo Express have been
reclassified on the balance sheets as net liabilities of discontinued
operation.
On October 2, 1994, the Company acquired substantially all of the assets of
Cloth World, a division of Brown Group Inc. ("Cloth World") for approximately
$100 million in cash and the assumption of certain liabilities. The final
purchase price is subject to post-closing adjustments. The funds used to
acquire Cloth World were provided by internally generated funds and borrowings
under the credit facility. The acquisition has been recorded using the
purchase method, and accordingly, the results of operations of Cloth World have
been included in the Company's consolidated financial statements since the date
of acquisition. The purchase price allocation has been based on preliminary
estimates which may be revised at a later date; however, the effect of any
revisions on the results of operations for the third quarter of fiscal 1995
would not be material. Cloth World, with fiscal 1994 sales of $224 million,
operated 342 specialty fabric stores in 26 states with a concentration in the
southern half of the United States.
RESULTS OF OPERATIONS
THIRTEEN WEEKS ENDED OCTOBER 29, 1994 VS. OCTOBER 30, 1993
Net sales for the third quarter of fiscal 1995 increased 19.3%, or $28.3
million, to $175.4 million from $147.1 million in fiscal 1994, largely due to
$21.5 million of sales generated from the Cloth World stores in the last four
weeks of the quarter. Net sales, excluding the Cloth World stores, increased
$6.8 million, or 4.6%, while comparable store sales increased 3.1% in the third
quarter of fiscal 1995 against the same quarter a year earlier. The increase
is primarily attributable to implementing a plan to improve customer service,
enhance store presentation and expand product assortment.
Gross profit increased $13.4 million in the third quarter of fiscal 1995
compared to the same quarter of fiscal 1994, primarily as a result of the
increase in sales volume. As a percentage of net sales, fiscal 1995 third
quarter gross profit was 45.4%, an increase of 0.3 percentage points from the
gross profit of 45.1% for the same quarter a year earlier.
Selling, general and administrative expenses for the third quarter of fiscal
1995 increased $11.7 million from the same quarter a year ago. The majority of
the increase was for operating expenses incurred in the newly acquired stores
with the remainder of the increase attributable to higher store level expenses
directed at improving customer service. As a percentage of net sales, selling,
general and administrative expenses increased 0.1 percentage points to 40.2%
from 40.1% for the third quarter of fiscal 1994.
Page 8 of 16
<PAGE> 9
Net interest expense increased $0.7 million to $2.5 million for the third
quarter of fiscal 1995 compared to the third quarter of fiscal 1994, due to a
higher interest rate on bank borrowings and to the incremental borrowings
related to the acquisition of Cloth World.
The Company's effective income tax rate was 38.5% for the second quarter of
fiscal 1995 compared to 37.5% for the same period a year ago. The change in
effective tax rate resulted from an increase in the federal corporate income
tax rate from 34% to 35%.
Net earnings for the third quarter of fiscal 1995 were $4.1 million, or $0.44
per share, which compares to net earnings of $3.5 million, or $0.38 per share,
for the same quarter a year earlier.
THIRTY-NINE WEEKS ENDED OCTOBER 29, 1994 VS. OCTOBER 30, 1993
For the first nine months of fiscal 1995, net sales increased 5.2%, or $21.0
million, to $421.0 million from $400.0 million in fiscal 1994. Excluding sales
of $21.5 million from the Cloth World stores, net sales decreased $0.5 million,
or 0.1%, and comparable store sales decreased 0.6% in the first nine months of
fiscal 1995 against the same period a year earlier.
Gross profit increased $14.3 million in the first nine months of fiscal 1995
compared to the same period of fiscal 1994. The majority of the increase was
from the operation of the newly acquired stores. As a percentage of net sales,
gross profit for the first nine months of fiscal 1995 was 43.9%, an
improvement of 1.3 percentage points from the gross profit of 42.6% for the
same period a year earlier. Reduced levels of promotional pricing during the
early months of fiscal 1995 compared to fiscal 1994 contributed to the increase
in gross profit margins.
Selling, general and administrative expenses for the first nine months of
fiscal 1995 increased $11.3 million from the same period a year ago. The
majority of the increase was for operating expenses incurred in the newly
acquired stores with the remainder of the increase attributable to higher store
level expenses directed at improving customer service. These increases were
partially offset by expense reductions resulting from the implementation of new
management information systems. As a percentage of net sales, selling, general
and administrative expenses increased 0.6 percentage points to 43.5% from 42.9%
for the first nine months of fiscal 1994.
Net interest expense increased $1.1 million to $5.7 million for the first
nine months of fiscal 1995 compared to the first nine months of fiscal 1994.
This increase was primarily attributable to higher interest rates on bank
borrowings.
The Company's effective income tax rate was 38.5% for the first nine months
of fiscal 1995 as compared to 37.5% for the same period a year ago as a result
of a change in federal corporate income tax rates.
Page 9 of 16
<PAGE> 10
The net loss for the first nine months of fiscal 1995 was $2.4 million, or
$0.26 per share, which compares to the net loss of $3.2 million, or $0.34 per
share, for the same period a year earlier. The net loss in the first nine
months of fiscal 1994 included a one-time credit of $0.4 million, or $0.04 per
share, from the cumulative effect of adopting SFAS No. 109, "Accounting for
Income Taxes."
LIQUIDITY AND CAPITAL RESOURCES
The Company completed the first nine months of fiscal 1995 in sound financial
condition. Working capital increased $53.6 million to $221.1 million, at
October 29, 1994, compared to $167.5 million at January 29, 1994. Nearly all
of the increase is related to the acquisition of Cloth World described above.
The ratio of current assets to current liabilities was 2.4:1 at October 29,
1994, 2.5:1 at October 30, 1993 and 3.1:1 at January 29, 1994.
The Company generated $17.9 million of cash from operations for the first
nine-months of fiscal 1995, a $43.0 million increase over the $25.1 million of
cash used by operations in the same period of fiscal 1994. The improvement is
principally the combined result of an increase in accounts payable and lower
inventory levels, as the Company continues to more effectively manage
inventory.
In the third quarter of fiscal 1995, the Company made an initial cash payment
of $62 million for the purchase of Cloth World. The cash payment may be
adjusted upon the resolution of any post-closing purchase price adjustments.
Capital expenditures were $8.2 million for the first nine months of fiscal
1995 as compared to $5.8 million for the first nine months of fiscal 1994.
These capital expenditures have been primarily used to open 29 superstores and
close 31 smaller stores. The Company expects capital expenditures for fiscal
1995 to be less than $15.0 million and to be used primarily to open
approximately 40 stores, while closing approximately 90 stores. During fiscal
1996, the Company will begin remodeling the Cloth World stores in order to
broaden the merchandise mix. The capital required for these expenditures will
be financed by internally generated funds and existing bank facilities.
The Company has borrowing capacity up to a maximum of $220 million available
through a $200 million revolving credit facility which expires September 29,
1997 and through existing lines of credit. As of October 29, 1994, the Company
had $110.0 million in borrowings outstanding under these facilities. For
additional information on the revolving credit facility, which was entered into
on September 30, 1994, see note 5 of the notes to consolidated financial
statements. The Company continues to maintain excellent vendor and banking
relationships and has sufficient current resources, including unused bank
facilities, to meet the financing needs of its operations, including the
acquisition of Cloth World.
The Company may purchase shares of its common stock from time to time in the
open market or in private transactions to be used to satisfy obligations under
the Company's employee
Page 10 of 16
<PAGE> 11
benefit plans and for other corporate purposes. The number of shares that can
be acquired pursuant to prior authorization by the Board of Directors is
1,028,325.
The Company's business exhibits seasonality which is typical of most retail
companies, with much stronger sales in the second half of the fiscal year than
the first half of the fiscal year. In general, net earnings are the highest
during the months of September through December, when high sales volumes
normally provide significant operating leverage. Conversely, net earnings are
substantially lower during the relatively low sales volume months of January
through August.
Sales in the fourth quarter of fiscal 1995 will be significantly higher than
in the same period of the prior year due to the acquisition of the Cloth World
stores. However, the liquidation of inventories through industry-wide store
closings could create short-term pricing pressures over the next several
months.
As of October 29, 1994, the Company operated 995 stores in 49 states,
including 815 superstores primarily under the name Jo-Ann Fabrics and Cloth
World.
Page 11 of 16
<PAGE> 12
PART II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
a) Exhibits
--------
See the Exhibit Index at sequential page 14 of this report.
b) Reports on Form 8-K
-------------------
The Company filed a report on Form 8-K dated October 2, 1994.
Under Item 2 ("Acquisition or Disposition of Assets"), the Company
reported the acquisition of substantially all of the assets and
assumption of certain liabilities of Cloth World, a division of
Brown Group, Inc. ("Cloth World").
Under Item 5 ("Other Events"), the Company reported the
establishment of a new three-year revolving credit facility with a
group of eight banks. Additionally, and in connection with the
acquisition of Cloth World, the Company announced that Donald L.
Richey, former President of Cloth World, had been elected
Executive Vice President and Chief Operating Officer of the
Company effective October 2, 1994.
The required financial statements and pro forma financial
information related to the acquisition reported in Item 2 and
required under Item 7 ("Financial Statements, Pro Forma Financial
Information and Exhibits") of the Form 8-K were not filed with the
Form 8-K dated October 2, 1994, but will be filed by an Amendment
on Form 8-K/A.
Page 12 of 16
<PAGE> 13
SIGNATURES
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.
FABRI-CENTERS OF AMERICA, INC.
DATE: December 13, 1994 /s/ Alan Rosskamm
-----------------------
BY: Alan Rosskamm
Chairman, President and Chief
Executive Officer
/s/ Robert Norton
-----------------------
BY: Robert Norton
Vice Chairman and Chief Financial
Officer
Page 13 of 16
<PAGE> 14
FABRI-CENTERS OF AMERICA, INC.
FORM 10-Q FOR THE THIRTEEN WEEK AND THIRTY-NINE WEEK
PERIODS ENDED OCTOBER 29, 1994
EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequential
Exhibit No. Description Page No.
----------- ----------- ----------
<S> <C> <C>
11 Statement re Computation of 15
Earnings per Common Share
27 Financial Data Schedule 16
</TABLE>
Page 14 of 16
<PAGE> 1
<TABLE>
COMPUTATION OF EARNINGS PER COMMON SHARE
Exhibit 11
Fabri-Centers of America, Inc.
(Thousands of dollars, except share and per share data)
<CAPTION>
Thirteen Weeks Ended
-----------------------------
October 29, October 30,
1994 1993
- - -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
PRIMARY EARNINGS PER SHARE:
Earnings (loss) before cumulative effect of accounting change $ 4,075 $ 3,536
Cumulative effect of accounting change - -
------------- -------------
Net earnings (loss) $ 4,075 $ 3,536
============= =============
Weighted average shares of common stock outstanding during the period 9,167,349 9,034,943
Incremental shares from assumed exercise of stock options (primary) 159,688 186,138
------------- -------------
9,327,037 9,221,081
============= =============
Primary earnings (loss) per common share:
Loss before cumulative effect of accounting change $ 0.44 $ 0.38
Cumulative effect of accounting change - -
------------- -------------
Net earnings (loss) $ 0.44 $ 0.38
============= =============
FULLY DILUTED EARNINGS PER SHARE:
Earnings (loss) before cumulative effect of accounting change $ 4,075 $ 3,536
Interest expense applicable to 6 1/4% convertible subordinated debentures,
net of tax 548 556
------------- -------------
4,623 4,092
Cumulative effect of accounting change - -
------------- -------------
Net earnings (loss) $ 4,623 $ 4,092
============= =============
Weighted average shares of common stock outstanding during the period 9,167,349 9,034,943
Incremental shares from assumed exercise of stock options (fully diluted) 220,529 210,818
Incremental shares from assumed conversion of 6 1/4% convertible
subordinated debentures 1,168,882 1,168,882
------------- -------------
10,556,760 10,414,643
============= =============
Fully diluted earnings (loss) per common share:
Earnings (loss) before cumulative effect of accounting change $ 0.44 $ 0.39
Cumulative effect of accounting change - -
------------- -------------
Net earnings (loss) $ 0.44 $ 0.39
============= =============
<CAPTION>
Thirty-Nine Weeks Ended
------------------------------
October 29, October 30,
1994 1993
- - -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
PRIMARY EARNINGS PER SHARE:
Earnings (loss) before cumulative effect of accounting change $ (2,380) $ (3,581)
Cumulative effect of accounting change - 399
------------- --------------
Net earnings (loss) $ (2,380) $ (3,182)
============= =============
Weighted average shares of common stock outstanding during the period 9,138,856 9,077,830
Incremental shares from assumed exercise of stock options (primary) 181,342 190,226
------------- --------------
9,320,198 9,268,056
============= =============
Primary earnings (loss) per common share:
Loss before cumulative effect of accounting change $ (0.26) $ (0.38)
Cumulative effect of accounting change - 0.04
------------- --------------
Net earnings (loss) $ (0.26) $ (0.34)
============= =============
FULLY DILUTED EARNINGS PER SHARE:
Earnings (loss) before cumulative effect of accounting change $ (2,380) $ (3,581)
Interest expense applicable to 6 1/4% convertible subordinated debentures,
net of tax 1,643 1,670
------------- --------------
(737) (1,911)
Cumulative effect of accounting change - 399
------------- --------------
Net earnings (loss) $ (737) $ (1,512)
============= =============
Weighted average shares of common stock outstanding during the period 9,138,856 9,077,830
Incremental shares from assumed exercise of stock options (fully diluted) 220,529 205,640
Incremental shares from assumed conversion of 6 1/4% convertible
subordinated debentures 1,168,882 1,168,882
------------- --------------
10,528,267 10,452,352
============= =============
Fully diluted earnings (loss) per common share:
Earnings (loss) before cumulative effect of accounting change $ (0.07) $ (0.18)
Cumulative effect of accounting change - 0.04
------------- --------------
Net earnings (loss) $ (0.07) $ (0.14)
============= =============
<FN>
Note: This calculation is submitted in accordance with Regulation S-K Item 601(b)(11) although it is contrary to
paragraph 40 of APB Opinion No. 15 because it produces an anti-dilutive result.
</TABLE>
Page 15 of 16
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE OCTOBER
29, 1994 CONSOLIDATED BALANCE SHEET AND THE CONSOLIDATED INCOME STATEMENT FOR
THE THIRTY-NINE WEEKS ENDED OCTOBER 29, 1994 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JAN-28-1995
<PERIOD-START> JAN-30-1994
<PERIOD-END> OCT-29-1994
<CASH> 18,690
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 342,617
<CURRENT-ASSETS> 380,331
<PP&E> 137,264
<DEPRECIATION> 52,708
<TOTAL-ASSETS> 483,001
<CURRENT-LIABILITIES> 159,219
<BONDS> 166,983
<COMMON> 988
0
0
<OTHER-SE> 146,517
<TOTAL-LIABILITY-AND-EQUITY> 483,001
<SALES> 420,961
<TOTAL-REVENUES> 420,961
<CGS> 236,136
<TOTAL-COSTS> 236,136
<OTHER-EXPENSES> 183,001
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 5,694
<INCOME-PRETAX> (3,870)
<INCOME-TAX> (1,490)
<INCOME-CONTINUING> (2,380)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,380)
<EPS-PRIMARY> (0.26)
<EPS-DILUTED> (0.07)
</TABLE>
