FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For quarterly period ended July 3, 1999
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: 0-10345
CACHE, INC.
----------------------------------------------------------
(Exact name of registrant as specified in its Charter)
Florida 59-1588181
- ------------------------ ------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
1460 Broadway, New York, New York 10036
- ------------------------------------------------------------------------
(Address of principal executive offices) (zip code)
212-575-3200
----------------------------------------------------
(Registrant's telephone number, including area code)
------
- ------------------------------------------------------------------------
(Former name, 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
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each issuer's classes of common
stock, as of the latest practicable date.
Common Stock, $.01 9,091,338
- --------------------------- ------------------------------
Class of Stock Outstanding Outstanding at August 13, 1999
<PAGE>
CACHE, INC. AND SUBSIDIARIES
INDEX
PAGE
CONSOLIDATED FINANCIAL STATEMENTS
BALANCE SHEETS, JULY 3, 1999
AND JANUARY 2, 1999 3
INCOME STATEMENTS
TWENTY-SIX WEEKS ENDED JULY 3, 1999
AND JUNE 27, 1998 4
THIRTEEN WEEKS ENDED JULY 3, 1999
AND JUNE 27, 1998 5
STATEMENTS OF CASH FLOWS
TWENTY-SIX WEEKS ENDED JULY 3, 1999
AND JUNE 27, 1998 6
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 7-9
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS 10-13
OTHER INFORMATION:
EXHIBIT AND REPORTS ON FORM 8-K 14
SIGNATURE 15
EXHIBIT 11.1 - CALCULATION OF BASIC AND DILUTED
EARNINGS PER SHARE 16
2
<PAGE>
<TABLE>
CACHE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<CAPTION>
July 3, January 2,
1999 1999
------------- -------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 9,731,000 $ 13,720,000
Receivables 1,258,000 1,525,000
Notes receivable from related parties 250,000 295,000
Inventories 20,678,000 18,911,000
Deferred income taxes and other assets 201,000 193,000
Prepaid expenses 593,000 629,000
------------- -------------
Total current assets 32,711,000 35,273,000
Property and equipment, net 15,598,000 14,776,000
Other assets 845,000 764,000
Deferred income taxes 763,000 745,000
------------- -------------
$ 49,917,000 $ 51,558,000
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 10,152,000 $ 13,178,000
Income taxes payable 640,000 943,000
Accrued compensation 1,360,000 1,447,000
Accrued liabilities 3,999,000 4,331,000
------------- -------------
Total current liabilities 16,151,000 19,899,000
Notes payable to related party 2,000,000 2,000,000
Other liabilities 1,659,000 1,763,000
Commitments and contingencies
STOCKHOLDERS' EQUITY
Common stock, par value $.01; authorized, 20,000,000
shares; issued and outstanding 9,091,338 shares
at July 3, 1999 and January 2, 1999 91,000 91,000
Additional paid-in capital 19,564,000 19,564,000
Retained earnings 10,452,000 8,241,000
------------- -------------
Total stockholders' equity 30,107,000 27,896,000
------------- -------------
$ 49,917,000 $ 51,558,000
============= =============
<FN>
The accompanying Notes to Consolidated Financial Statements are an integral part of these balance she
</FN>
</TABLE>
3
<PAGE>
<TABLE>
CACHE, INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
FOR THE TWENTY-SIX WEEKS ENDED
(Unaudited)
<CAPTION>
July 3, June 27,
1999 1998
------------ ------------
<S> <C> <C>
Net sales $ 76,514,000 $ 67,854,000
Costs and expenses
Cost of sales, including occupancy and buying costs 49,217,000 44,321,000
Selling, general and administrative expenses 23,675,000 21,405,000
------------ -----------
72,892,000 65,726,000
------------ -----------
Operating income 3,622,000 2,128,000
------------ -----------
Interest expense
Related party (70,000) (70,000)
Other --- (14,000)
------------- ------------
(70,000) (84,000)
------------- ------------
Interest income 196,000 93,000
------------- ------------
Income before income taxes 3,748,000 2,137,000
Income tax provision 1,537,000 876,000
------------- ------------
Net income $ 2,211,000 $ 1,261,000
============= ============
Basic and diluted earnings per share $0.24 $0.14
============= ============
Weighted average number of shares and
share equivalents outstanding 9,258,000 9,173,000
============= ============
<FN>
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
</FN>
</TABLE>
4
<PAGE>
<TABLE>
CACHE, INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
FOR THE THIRTEEN WEEKS ENDED
(Unaudited)
<CAPTION>
July 3, June 27,
1999 1998
------------- -------------
<S> <C> <C>
Net sales $ 40,028,000 $ 36,520,000
------------- -------------
Costs and expenses
Cost of sales, including occupancy and buying costs 25,501,000 23,542,000
Selling, general and administrative expenses 12,126,000 10,961,000
------------- -----------
37,627,000 34,503,000
Operating income 2,401,000 2,017,000
------------- -------------
Interest expense
Related party (35,000) (35,000)
Other - (2,000)
------------ --------------
(35,000) (37,000)
------------ --------------
Interest income 107,000 60,000
------------ --------------
Income before income taxes 2,473,000 2,040,000
Income tax provision 1,014,000 836,000
------------ --------------
Net income $ 1,459,000 $ 1,204,000
============ ==============
Basic and diluted earnings per share $0.16 $0.13
------------ -------------
Weighted average number of shares and
share equivalents outstanding 9,266,000 9,177,000
============ ==============
<FN>
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
</FN>
</TABLE>
5
<PAGE>
<TABLE>
CACHE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE TWENTY-SIX WEEKS ENDED
(Unaudited)
<CAPTION>
July 3, June 27,
1999 1998
------------- -------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 2,211,000 $ 1,261,000
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization 2,139,000 2,012,000
Decrease (increase) in deferred income taxes (26,000) 31,000
Reversal of future rent escalations (52,000) (34,000)
Change in assets and liabilities:
Decrease in receivables 267,000 143,000
Decrease (increase) in notes receivable from related parties 45,000 (49,000)
Decrease (increase) in inventories (1,767,000) 62,000
Decrease (increase) in prepaid expenses 36,000 (68,000)
Decrease in accounts payable (3,026,000) (2,452,000)
Decrease in income taxes payable (303,000) (301,000)
Decrease in accrued liabilities and accrued compensatio (471,000) (1,084,000)
----------- -----------
Total changes in assets and liabilities (5,219,000) (3,749,000)
----------- -----------
Net cash used in operating activities (947,000) (479,000)
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from property and equipment disposals --- 23,000
Payments for property and equipment (2,940,000) (1,130,000)
------------- -------------
Net cash used in investing activities (2,940,000) (1,107,000)
------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long-term bank debt --- 550,000
Repayment of long-term bank debt --- (550,000)
Other, net (102,000) (49,000)
------------ -------------
Net cash used in financing activities (102,000) (49,000)
------------ -------------
Net decrease in cash and cash equivalents (3,989,000) (1,635,000)
Cash and cash equivalents, at beginning of period 13,720,000 5,892,000
------------- -------------
Cash and cash equivalents, at end of period $ 9,731,000 $ 4,257,000
============= =============
<FN>
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
</FN>
</TABLE>
6
<PAGE>
CACHE, INC.
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
---------------------
In the opinion of the Company, the accompanying consolidated financial
statements include all adjustments necessary, which are considered normal and
recurring to present fairly the financial position of the Company at July 3,
1999(Fiscal 1999)and January 2, 1999 (Fiscal 1998), and the results of
operations for the twenty-six and thirteen week periods ended July 3, 1999 and
June 27, 1998 and consolidated statements of cash flows for the twenty-six
weeks then ended.
Certain financial information which is normally included in financial
statements prepared in accordance with generally accepted accounting
principles, but which is not required for interim reporting purposes, has been
condensed or omitted. The accompanying consolidated financial statements
should be read in conjunction with the Financial Statements and notes thereto
included in the Company's latest annual report on Form 10-K for the fiscal
year ended January 2, 1999. Certain amounts reflected in Fiscal 1998 financial
statements have been reclassified to conform with the presentation of similar
items in Fiscal 1999.
Net income includes all sources of comprehensive income. There were no
adjustments for foreign currency translation, unrealized gains(losses)on
investments or deferred compensation expense incurred in Fiscal 1999 or Fiscal
1998 results.
2. BASIC AND DILUTED EARNINGS
--------------------------
Basic and diluted earnings per share has been computed based on the
weighted average number of shares of common stock outstanding for the
twenty-six and thirteen weeks ended July 3, 1999 and June 27, 1998.
The approximate number of shares used in the computations of basic and
diluted earnings per share were 9,258,000 and 9,173,000, for the twenty-six
week periods and 9,266,000 and 9,177,000 for the thirteen week periods ended
July 3, 1999 and June 27, 1998, respectively.
7
<PAGE>
3. PROPERTY AND EQUIPMENT
----------------------
July 3, January 2,
1999 1999
------------ -----------
Leasehold improvements $17,615,000 $16,912,000
Furniture, fixtures and
equipment 22,101,000 19,864,000
------------ -----------
39,716,000 36,776,000
Less: accumulated depreciation
and amortization 24,118,000 22,000,000
------------ -----------
$15,598,000 $14,776,000
============ ===========
4. ACCRUED LIABILITIES
-------------------
July 3, January 2,
1999 1999
---------- -----------
Operating Expenses $1,164,000 $1,193,000
Taxes, other than income taxes 840,000 1,396,000
Leasehold additions 468,000 30,000
Other customer deposits 1,527,000 1,712,000
---------- -----------
$3,999,000 $4,331,000
========== ===========
5. BANK DEBT
---------
During July 1999, the Company reached an agreement with its bank to
extend the maturity of the Amended Revolving Credit Facility until January 31,
2003. Pursuant to the Amended Revolving Credit Facility $15,000,000 is
available until expiration at January 31, 2003. The amounts outstanding
thereunder bear interest at a maximum per annum rate up to the bank's prime
rate. The agreement contains selected financial and other covenants including
covenants to maintain a minimum current ratio, a maximum debt to equity ratio,
a maximum capital expenditure covenant and a minimum fixed charge coverage
ratio. The amended agreement now permits the payment of dividends on the
Company's common stock. Effective upon the occurrence of an Event of Default
under the Revolving Credit Facility, the Company grants to the bank a security
interest in the Company's inventory and certain receivables.
There was no outstanding balance on the line of credit at July 3, 1999,
and January 2, 1999. The related party debt is no longer subordinated to the
bank debt and repayment is no longer subject to terms of the Amended Revolving
Credit Facility. The Company is currently in compliance with all covenant
requirements.
8
<PAGE>
NOTE 6. INDEBTEDNESS TO/FROM RELATED PARTIES
------------------------------------
As of July 3, 1999 and January 2, 1999 the Company had outstanding, (i) a
$250,000 long-term loan from a major stockholder bearing interest payable
quarterly with principal due upon demand at any time after January 31, 2000;
and (ii) a $1,750,000 loan made by the same stockholder bearing interest
payable quarterly with principal due upon demand at any time after January 31,
2000. Interest on both notes accrue at 7% per year through January 31, 2000.
In July 1999, the Company and the major stockholder agreed to extend the
maturity date on the notes to January 31, 2003, at the current interest rate
of 7% per annum.
On April 27, 1998, the Company loaned an executive $50,000, which was to
be repaid in 60 monthly payments. The loan has been subsequently repaid in
full.
7. INCOME TAXES
------------
The effective tax rate for Fiscal 1999 and 1998 is 41.0%. At July 3,
1999 and January 2, 1999, the Company's deferred tax assets were $964,000 and
$938,000, respectively, and, there was no deferred tax liability. The major
components of the Company's net deferred taxes at are as follows:
July 3, January 2,
1999 1999
--------- ---------
Net operating loss carryforwards ("NOL'S")....... $ 40,000 $ 40,000
Deferred rent................................... 816,000 837,000
Other........................................... 108,000 61,000
--------- ---------
$ 964,000 $ 938,000
========== =========
8. CONTINGENCIES
-------------
The Company is exposed to a number of asserted and unasserted potential
claims. In the opinion of management, the resolution of these matters is not
presently expected to have a material adverse effect upon the Company's
financial position and results of operations.
9
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
STATEMENT REGARDING FORWARD LOOKING STATEMENTS
- ----------------------------------------------
Except for the historical information and current statements contained in
this Form 10-Q, certain matters discussed herein, including, without
limitation, "Management's Discussion and Analysis of Financial Condition and
Results of Operations" are forward looking statements that involve risks and
uncertainties, including, without limitation, the effect of economic and
market conditions and competition, the ability to open new stores and expand
into new markets, and risks relating to foreign importing operations, which
would cause actual results to differ materially.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
The Company's primary need for capital is to finance new store
merchandise inventories, as well as the construction of new stores and the
renovation of existing stores. During the twenty-six weeks ended July 3,
1999, the Company used cash ($3,989,000) and cash flow from non-cash
depreciation expenses ($2,139,000) to repay accounts payable ($3,026,000), to
fund inventory increase ($1,767,000)and to fund the Company's store expansion
and remodeling program ($2,940,000). The Company had no bank borrowings
during Fiscal 1999.
The Company plans to open approximately thirteen new Cache stores during
1999. The Company has opened six new Cache stores in the first half of 1999.
Approximately seven new Cache stores are expected to be opened during the
second half of 1999. The Company also plans to open approximately six new
Lillie Rubin stores during the second half of 1999, including it's first new
prototype Lillie Rubin store at South Hills Village, in Pittsburgh, PA. After
deducting construction allowances paid to the Company by its landlords, the
Company has spent approximately $2,940,000 through July 3, 1999 and expects to
spend an additional $3,500,000 in 1999 for both new store and existing store
construction and remodeling. The Company closed one store in July, 1999, the
closure had no material impact on earnings.
The Company has completed a comprehensive review of its computer systems
and is nearing completion of modifications to existing software and conversion
to new software, in preparation for the Year 2000. To date, the Company has
spent approximately $125,000 for external consulting, software and hardware
improvements. The total costs associated with modifying current systems and
new software cost is not anticipated to have a material impact on results of
operations, cash flows or financial condition in any given year. However, no
assurances can be given that the Company will be able to completely identify
or address all year 2000 compliance issues, or that third parties with whom
the Company does business will not experience system failures as a result of
the year 2000 issue, nor can the Company fully predict the consequences of
noncompliance.
10
<PAGE>
Management believes that the Company's internally generated cash flows
will be sufficient to meet anticipated requirements for operations and planned
expansion during Fiscal 1999. The Company's cash flow from operations
continues to be strong, as evidenced by the Company's current ratio at July 3,
1999 of 2.03 : 1.00; with cash on hand of $9.7 million and no bank debt
outstanding.
RESULTS OF OPERATIONS
- ---------------------
For the twenty-six and thirteen weeks ended July 3, 1999, the 5% increase
and 4% increase, respectively, in comparative store sales, as well as higher
gross margins was partially offset by higher occupancy costs and selling
general and administrative expenses, resulting in an increase in net income
in Fiscal 1999 as compared to Fiscal 1998. The increase in selling, general
and administrative expenses was partially offset by reductions in net interest
expense, as well as an increase in interest income.
Certain financial data concerning the Company's results of operations for
the twenty-six and thirteen week periods ended July 3, 1999 and June 27, 1998,
expressed as a percentage of net sales, are as follows:
Twenty-six Weeks Ended Thirteen Weeks Ended
---------------------- --------------------
July 3, June 27, June 27, July 3,
1999 1998 1998 1999
-------- -------- --------- -------
Sales 100.0% 100.0% 100.0% 100.0%
Cost of sales, including
occupancy and buying expenses 64.3% 65.3% 63.7% 64.5%
Selling, general and
administrative expenses 30.9% 31.5% 30.3% 30.0%
Income before taxes 4.9% 3.1% 6.2% 5.6%
Income tax provision 2.0% 1.3% 2.5% 2.3%
Net income 2.9% 1.8% 3.6% 3.3%
Sales
- -----
Net sales increased $8,660,000 or 13.8% and $3,508,000 or 9.6%,
respectively, during the twenty-six and thirteen week periods ended July 3,
1999, versus the comparable periods in 1998. The increases were primarily due
to the greater number of stores open during the 1999 period, approximately 187
as compared to approximately 170 in Fiscal 1998, as well as an increase in
comparable store sales during the 1999 periods. Comparable store sales
increased 5% and 4%, respectively, for the twenty-six and thirteen week
periods in 1999, as compared to the comparable periods in 1998.
11
<PAGE>
Historically, sales at new stores do not achieve the same levels as
existing, established stores. New stores generally begin to perform as well
as existing stores during their second and third year of operation. Sales on
a weighted average basis for the twenty-six and thirteen week periods ended
July 3, 1999 and June 27, 1998 were as follows:
Twenty-six Weeks Ended Thirteen Weeks Ended
------------------------- ------------------------
July 3, June 27, July 3, June 27,
1999 1998 1999 1998
------------------------- -------------------------
Sales $76,514,000 $67,854,000 $40,028,000 $36,520,000
Weighted Average Stores
Open During Period 186.8 170.0 188.8 170.8
Net Sales Per Weighted
Average Number of Stores $410,000 $399,000 $212,000 $214,000
Net Weighted Average Sales
per square foot $193.54 $192.19 $100.35 $103.00
Stores Open at End
of Period 190 171 190 171
Costs and expenses
- -------------------
Cost of sales, including occupancy and buying costs, increased $4,896,000
or 11.0% for the twenty-six weeks ended July 3, 1999, versus the similar
period in 1998. The increase was primarily due to the increase in sales and
the related cost of merchandise for those sales, as well as a $1,182,000
increase in occupancy expenses, primarily due to the additional stores in
operation during the 1999 versus 1998. As a percentage of sales, cost of
sales, including the occupancy expenses, decreased 1.0%, (64.3% versus 65.3%)
for the twenty-six week period ended July 3, 1999, versus the comparable
period in 1998. The decrease was primarily due to higher initial mark-ups in
1999, as compared to Fiscal 1998.
Cost of sales, including occupancy and buying costs, increased $1,959,000
or 8.3% for the thirteen weeks ended July 3, 1999, versus the similar 1998
period. The increase was primarily due to the increase in sales and the
related cost of the merchandise for those sales, and a $595,000 increase in
occupancy, due to the additional stores in operation during 1999 versus 1998.
As a percentage of sales, cost of sales, including occupancy and buying
expenses, decreased 0.8% (63.7% versus 64.5%) for the thirteen weeks ended
July 3, 1999, versus the comparable period in 1998. The decrease was
primarily due to higher initial mark-ups, as compared to the comparable period
in 1998, and was partially offset by higher markdowns, as a percent of sales,
as compared to the 1998 period.
12
<PAGE>
Selling, general and administrative expenses
- ---------------------------------------------
Selling, general and administrative expenses ("S,G&A") increased
$2,270,000 or 10.6% during the twenty-six week period ended July 3, 1999
versus the comparable period in 1998. The increase was primarily due to the
greater number of stores open in Fiscal 1999 as compared to Fiscal 1998. The
increase in certain expense categories was due to greater payroll and payroll
taxes ($1,875,000), credit card fees ($104,000), depreciation ($127,000) and
licenses and taxes ($110,000), and was partially offset by a reduction in
freight expense ($78,000)and advertising expense($52,000). As a percentage of
sales, these expenses decreased 0.6% (30.9% versus 31.5%) for the twenty-six
weeks ended July 3, 1999 versus the similar 1998 period. The decrease was due
primarily to the effect of higher comparable store sales, experienced in the
current twenty-six week period, upon S,G&A expenses, which are relatively
fixed in nature, as well as management's efforts to contain S,G&A expenses.
Selling, general and administrative expenses increased $1,165,000 or
10.6% during the thirteen weeks ended July 3, 1999, versus the comparable
period in 1998. The increase was primarily due to greater number of stores
open in Fiscal 1999, as compared to Fiscal 1998. The increase in several
expense catagories was primarily due to greater payroll and payroll taxes
($964,000), licenses and taxes($67,000) and depreciation($64,000). As a
percentage of sales, these expenses increased 0.3% (30.3% versus 30.0%) for
the thirteen weeks ended July 3, 1999 versus the similar 1998 period. The
increase was due primarily to the effect of higher payroll and payroll taxes
which was primarily driven by the greater number of stores open during the
Fiscal 1999 period.
Interest expense
- ----------------
Interest expense decreased $14,000 and $2,000, respectively, for the
twenty-six and thirteen week periods ended July 3, 1999 versus the comparable
period in 1998, primarily due to elimination of bank borrowing in 1999.
Interest income
- ---------------
Interest income increased to $196,000 from $93,000 for the twenty-six
week period, as well as increasing to $107,000 from $60,000 for the thirteen
week period. The increase is primarily due to the strong cash flow levels the
Company is generating.
Income taxes
- -------------
The Company's effective tax rate is approximately 41%, for Fiscal 1999
and 1997, respectively.
13
<PAGE>
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
NONE
(b) Reports on Form 8-K
NONE
14
<PAGE>
Signature
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.
CACHE, INC.
(Registrant)
August 13, 1999 BY: /s/ Thomas E. Reinckens
-----------------------
Thomas E. Reinckens
On behalf of Cache, Inc.
and in his capacity as
Executive Vice President and
Chief Financial Officer
(Principal Financial and
Principal Accounting Officer)
15
<PAGE>
<TABLE>
EXHIBIT 11.1
CALCULATION OF BASIC AND DILUTED EARNINGS PER SHARE
(In thousands except per share data)
<CAPTION>
TWENTY-SIX THIRTEEN
WEEKS ENDED WEEKS ENDED
--------------------------- --------------------------------
July 3, June 27, July 3, June 27,
1999 1998 1999 1998
--------------------------- --------------------------------
<S> <C> <C> <C> <C>
EARNINGS
Net Income Applicable
to Common Stockholders $ 2,211,000 $ 1,261,000 $ 1,459,000 $ 1,204,000
============================= ==================================
BASIC EARNINGS PER SHARE
Weighted Average Number of
Common Shares Outstanding 9,091,000 9,091,000 9,091,000 9,091,000
============================= =================================
Basic Earnings Per Share $0.24 $0.14 $0.16 $0.13
============================= ==================================
DILUTED EARNINGS PER SHARE
Weighted Average Number of
Common Shares Outstanding 9,091,000 9,091,000 9,091,000 9,091,000
Assuming Conversion of
Outstanding Stock Options 600,000 476,000 600,000 476,000
Less Assumed Repurchase
of Common Stock Pursuant
to the Treasury Stock Meth (433,000) (394,000) (425,000) (390,000)
----------------------------- ---------------------------------
Weighted Average Number of
Common Shares Outstanding
As Adjusted 9,258,000 9,173,000 9,266,000 9,177,000
============================== ==================================
Diluted Earnings Per Share $0.24 $0.14 $0.16 $0.13
============================== ==================================
</TABLE>
16
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JAN-01-2000
<PERIOD-END> JUL-03-1999
<CASH> 9731000
<SECURITIES> 0
<RECEIVABLES> 1508000
<ALLOWANCES> 0
<INVENTORY> 20678000
<CURRENT-ASSETS> 32711000
<PP&E> 39716000
<DEPRECIATION> 24118000
<TOTAL-ASSETS> 49917000
<CURRENT-LIABILITIES> 16151000
<BONDS> 0
<COMMON> 91000
0
0
<OTHER-SE> 30016000
<TOTAL-LIABILITY-AND-EQUITY> 49917000
<SALES> 76514000
<TOTAL-REVENUES> 76514000
<CGS> 49217000
<TOTAL-COSTS> 49217000
<OTHER-EXPENSES> 23675000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (196000)
<INCOME-PRETAX> 3748000
<INCOME-TAX> 1537000
<INCOME-CONTINUING> 2211000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2211000
<EPS-BASIC> .24
<EPS-DILUTED> .24
</TABLE>
