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 October 2, 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 November 17, 1999
<PAGE>
CACHE, INC. AND SUBSIDIARIES
INDEX
PAGE
CONSOLIDATED FINANCIAL STATEMENTS
BALANCE SHEETS, OCTOBER 2, 1999
AND JANUARY 2, 1999 3
STATEMENTS OF OPERATIONS
THIRTY-NINE WEEKS ENDED OCTOBER 2, 1999
AND SEPTEMBER 26, 1998 4
THIRTEEN WEEKS ENDED OCTOBER 2, 1999
AND SEPTEMBER 26, 1998 5
STATEMENTS OF CASH FLOWS
THIRTY-NINE WEEKS ENDED OCTOBER 2, 1999
AND SEPTEMBER 26, 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 INDEX AND REPORTS ON FORM 8-K 13
SIGNATURES 14
EXHIBIT 11.1 - CALCULATION OF BASIC AND DILUTED
EARNINGS PER SHARE 15
2
<PAGE>
<TABLE>
CACHE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<CAPTION>
October 2, January 2,
1999 1999
------------- --------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 6,448,000 $ 13,720,000
Receivables 2,030,000 1,525,000
Notes receivable from related parties 250,000 295,000
Inventories 25,031,000 18,911,000
Prepaid income taxes and other assets 798,000 193,000
Prepaid expenses 696,000 629,000
------------- -------------
Total current assets 35,253,000 35,273,000
Property and equipment, net 16,277,000 14,776,000
Other assets 833,000 764,000
Deferred income taxes 802,000 745,000
------------- -------------
$ 53,165,000 $ 51,558,000
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 15,442,000 $ 13,178,000
Income taxes payable --- 943,000
Accrued compensation 697,000 1,447,000
Accrued liabilities 4,055,000 4,331,000
------------- -------------
Total current liabilities 20,194,000 19,899,000
Notes payable to related party 2,000,000 2,000,000
Other liabilities 1,620,000 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 October 2, 1999 and January 2, 1999 91,000 91,000
Additional paid-in capital 19,564,000 19,564,000
Retained earnings 9,696,000 8,241,000
------------- -------------
Total stockholders' equity 29,351,000 27,896,000
------------- -------------
$ 53,165,000 $ 51,558,000
============= =============
<FN>
The accompanying Notes to Consolidated Financial Statements are an integral part of these balance sheets.
</FN>
</TABLE>
3
<PAGE>
<TABLE>
CACHE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THIRTY-NINE WEEKS ENDED
(Unaudited)
<CAPTION>
October 2, September 26,
1999 1998
--------------- --------------
<S> <C> <C>
Net sales $ 110,790,000 $ 98,817,000
--------------- --------------
Costs and expenses
Cost of sales, including occupancy and buying costs 72,464,000 65,137,000
Selling, general and administrative expenses 35,968,000 32,212,000
--------------- --------------
108,432,000 97,349,000
--------------- --------------
Operating income 2,358,000 1,468,000
Interest expense
Related party (105,000) (105,000)
Other --- (14,000)
--------------- --------------
(105,000) (119,000)
--------------- --------------
Interest and other income, net 212,000 145,000
--------------- --------------
Income before income taxes 2,465,000 1,494,000
Income tax provision 1,010,000 612,000
--------------- --------------
Net income $ 1,455,000 $ 882,000
=============== ==============
Basic and diluted earnings per share $0.16 $0.10
=============== ==============
Weighted average number of shares and
share equivalents outstanding 9,321,000 9,168,000
=============== ==============
<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 STATEMENTS OF OPERATIONS
FOR THE THIRTEEN WEEKS ENDED
(Unaudited)
<CAPTION>
October 2, September 26,
1999 1998
------------- ---------------
<S> <C> <C>
Net sales $ 34,276,000 $ 30,963,000
-------------- ---------------
Costs and expenses
Cost of sales, including occupancy and buying costs 23,247,000 20,816,000
Selling, general and administrative expenses 12,293,000 10,807,000
-------------- ---------------
35,540,000 31,623,000
-------------- ---------------
Operating loss (1,264,000) (660,000)
Interest expense
Related party (35,000) (35,000)
Other --- ---
-------------- ---------------
(35,000) (35,000)
-------------- ---------------
Interest and other income, net 16,000 52,000
-------------- ---------------
Loss before income tax benefit (1,283,000) (643,000)
Income tax benefit (527,000) (264,000)
-------------- ---------------
Net loss $ (756,000) $ (379,000)
============== ===============
Basic loss per share ($0.08) ($0.04)
============== ===============
Weighted average number of shares and
share equivalents outstanding 9,091,000 9,091,000
============== ===============
<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 THIRTY-NINE WEEKS ENDED
(Unaudited)
<CAPTION>
October 2, September 26,
1999 1998
-------------- --------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
-------------------------------------
Net income $ 1,455,000 $ 882,000
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization 3,272,000 2,943,000
Reversal of future rent escalations (72,000) (48,000)
Change in assets and liabilities:
---------------------------------
Decrease (increase) in receivables (505,000) 93,000
Decrease (increase) in notes receivable from related parties 45,000 (47,000)
Increase in inventories (6,120,000) (3,816,000)
Increase in prepaid income taxes and other assets (662,000) (594,000)
Decrease (increase) in prepaid expenses (67,000) 349,000
Decrease in income taxes payable (943,000) (359,000)
Increase in accounts payable 2,264,000 449,000
Decrease in accrued liabilities and accrued compensation (1,097,000) (112,000)
-------------- --------------
Total changes in assets and liabilities (7,085,000) (4,037,000)
-------------- --------------
Net cash used in operating activities (2,430,000) (260,000)
-------------- --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
-------------------------------------
Payments for property and equipment (4,796,000) (1,765,000)
Purchase of Lillie Rubin, net --- (1,104,000)
Disposal of property and equipment 54,000 23,000
-------------- --------------
Net cash used in investing activities (4,742,000) (2,846,000)
-------------- --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
-------------------------------------
Long-term bank debt additional borrowings --- 1,050,000
Long-term bank debt principal repayments --- (1,050,000)
Other, net (100,000) (4,000)
-------------- --------------
Net cash used in financing activities (100,000) (4,000)
-------------- --------------
Net decrease in cash and cash equivalents (7,272,000) (3,110,000)
Cash and cash equivalents, at beginning of period 13,720,000 5,892,000
-------------- --------------
Cash and cash equivalents, at end of period $ 6,448,000 $ 2,782,000
============== ==============
<FN>
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
</FN>
</TABLE>
6
<PAGE>
CACHE, INC. & SUBSIDIARIES
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 October 2, 1999 (Fiscal 1999) and January 2,
1999 (Fiscal 1998), and the results of operations for the thirty-nine
and thirteen week periods ended October 2, 1999 and September 26, 1998
and consolidated statements of cash flows for the thirty-nine 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 thirty-nine and thirteen weeks ended October 2, 1999 and September
26, 1998.
The approximate number of shares used in the computations of basic
and diluted earnings per share were 9,321,000 and 9,168,000, for the
thirty-nine week periods and 9,091,000 and 9,091,000 for the thirteen
week periods ended October 2,1999 and September 26, 1998, respectively.
7
<PAGE>
3. PROPERTY AND EQUIPMENT
----------------------
October 2, January 2,
1999 1999
----------- -----------
Leasehold improvements $17,990,000 $16,912,000
Furniture, fixtures and
equipment 23,240,000 19,864,000
----------- -----------
41,230,000 36,776,000
Less: accumulated depreciation
and amortization 24,953,000 22,000,000
----------- -----------
$16,277,000 $14,776,000
=========== ===========
4. ACCRUED LIABILITIES
-------------------
October 2, January 2,
1999 1999
----------- -----------
Operating expenses $ 1,105,000 $1,193,000
Taxes, other than income taxes 1,071,000 1,396,000
Leasehold additions 428,000 30,000
Other customer deposits 1,451,000 1,712,000
----------- -----------
$ 4,055,000 $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 any 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 October
2, 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>
6. INDEBTEDNESS TO/FROM RELATED PARTIES
------------------------------------
As of October 2, 1999 and January 2, 1999 the Company had outstanding,
(i) a $250,000 long-term loan from a major stockholder bearing interest
payable quarterly and (ii) a $1,750,000 loan made by the same stockholder
bearing interest payable quarterly. 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 $50,000 to an employee, which was
to be repaid in 60 monthly payments. The loan has been subsequently repaid
in full.
7. INCOME TAXES
------------
The effective tax rate is approximately 41% for Fiscal 1999 and 1998,
respectively. At October 2, 1999 and January 2, 1999, the Company's deferred
tax assets were $1,007,000 and $938,000, respectively, and there was no
deferred tax liability. The major components of the Company's net deferred
taxes are as follows:
October 2, January 2,
1999 1999
----------- -----------
Net operating loss carryforwards ("NOL'S")...... $ 40,000 $ 40,000
Deferred rent................................... 813,000 837,000
Other........................................... 154,000 61,000
----------- -----------
$1,007,000 $ 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 thirty-nine weeks ended October 2,
1999, the Company used cash ($7,272,000) and cash flow from non-cash
depreciation expenses ($3,272,000) as well as an increase in accounts payable
($2,264,000), to fund the Company's store expansion and remodeling program
($4,796,000), as well as the related increase in store inventories
($6,120,000)and the payment of accrued expenses and taxes payable. There was
no outstanding balance on the line of credit at October 2, 1999.
The Company has opened ten new Cache stores and two new Lillie Rubin
stores in Fiscal 1999. The Company has spent approximately $4,796,000 (net
of landlord construction allowances), through October 2, 1999 and expects to
spend approximately $2,500,000 for capital expenditures during the fourth
quarter of Fiscal 1999. The Company closed one store in July 1999, which had
no material impact on earnings.
The Company has completed a comprehensive review of its computer systems
and has completed modifications to existing software and conversion to new
software, in preparation for the Year 2000. The Company has also tested all
existing and new software, for Year 2000 compliance. To date, the Company
has spent approximately $150,000 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 current ratio at October 2, 1999
was 1.75 : 1.00; with cash on hand of $6.4 million as compared to cash on hand
of $2.8 million at September 26, 1998. The Company's cash flow from operations
is primarily driven by improved earnings and non-cash depreciation charges of
$3.3 million for the thirty-nine week period.
RESULTS OF OPERATIONS
- ---------------------
For the thirty-nine week period ended October 2, 1999, a 3% increase in
comparative store sales was the primary factor contributing to the increase in
net income, as compared to Fiscal 1998.
For the thirteen week Fiscal 1999 period, the net loss increased as
compared to Fiscal 1998. The primary factor was the increase in the number of
stores open and the resulting increase in occupancy and selling expenses.
Markdowns increased, both in dollars and as a percent of sales, which also
contributed to lower gross margins. An increase in the size of the buying
staff also increased selling general and administrative ("S,G&A") expenses.
Certain financial data concerning the Company's results of operations for
the thirty-nine and thirteen week periods ended October 2, 1999 and September
26, 1998, expressed as a percentage of net sales, are as follows:
Thirty-nine Weeks Ended Thirteen Weeks Ended
----------------------- ------------------------
Oct. 2, Sept. 26, Oct. 2, Sept. 26,
1999 1998 1999 1998
------ --------- ------- --------
Sales 100.0% 100.0% 100.0% 100.0%
Cost of sales, including
occupancy and buying expenses 65.4% 65.9% 67.8% 67.2%
Selling, general and
administrative expenses 32.5% 32.6% 35.9% 34.9%
Income (loss) before taxes 2.2% 1.5% (3.7%) (2.1%)
Income tax provision (benefit) 0.9% 0.6% (1.5%) (0.9%)
Net income (loss) 1.3% 0.9% (2.2%) (1.2%)
Sales
- -----
Net sales increased $11,973,000 or 12.1% and $3,313,000 or 10.7%,
respectively, during the thirty-nine and thirteen week periods ended October 2,
1999, versus the comparable periods in 1998. The increases were primarily due
to the additional stores open as compared to Fiscal 1998, as well as comparable
store sales increases during the Fiscal 1999 periods. Comparable store sales
increased 3%, for the thirty-nine week period and increased 1% for the thirteen
week period in Fiscal 1999, as compared to the comparable periods in Fiscal
1998. The number of stores open increased to 195 stores as of October 2, 1999,
from 184 stores in operation as of September 26, 1998.
11
<PAGE>
Costs and expenses
- ------------------
Cost of sales, including occupancy and buying costs, increased $7,327,000
or 11.2% for the thirty-nine weeks ended October 2, 1999, versus the similar
period in Fiscal 1998. The increase was primarily due to the increase in sales
and the related cost of merchandise for those sales, as well as a $1,854,000
increase in occupancy expenses, primarily due to the additional stores in
operation during Fiscal 1999, as compared to Fiscal 1998. As a percentage of
sales, cost of sales, including the occupancy expenses, decreased from 65.9%,
in Fiscal 1998 to 65.4% in Fiscal 1999 for the thirty-nine week period. The
decrease was partially due to higher initial mark-up in Fiscal 1999.
Cost of sales, including occupancy and buying costs, increased $2,431,000
or 11.7% for the thirteen weeks ended October 2,1999, versus the similar Fiscal
1998 period. The increase was primarily due to the increase in sales and the
related cost of the merchandise for those sales, and a $672,000 increase in
occupancy, due to the additional stores in operation during Fiscal 1999 as
compared to Fiscal 1998. As a percentage of sales, cost of sales, including
occupancy and buying expenses, increased 0.6% (67.8% versus 67.2%) for the
thirteen weeks ended October 2, 1999, versus the comparable period in Fiscal
1998. The increase was primarily due to an increase in occupancy and buying
expense, as well as due to higher markdowns, both in dollars and as a percent
of sales in Fiscal 1999.
Selling, general and administrative expenses
- --------------------------------------------
Selling, general and administrative expenses ("S,G&A") increased $3,756,000
or 11.7% during the thirty-nine week period ended October 2, 1999 versus the
comparable period in Fiscal 1998. The increase was primarily due to greater
payroll and payroll taxes ($3,040,000), credit card fees ($167,000),
depreciation ($329,000), licenses and taxes ($176,000) and insurance expenses
($75,000), and was partially offset by a reduction in freight expense
($111,000), and advertising expense ($61,000). As a percentage of sales, these
expenses decreased 0.1% (32.5% versus 32.6%) for the thirty-nine weeks ended
October 2, 1999 versus the similar 1998 period. The decrease was due primarily
to the effect of higher comparable store sales, experienced in the current
thirty-nine week period, upon S,G&A expenses, which are relatively fixed in
nature.
Selling, general and administrative expenses increased $1,486,000 or 13.8%
during the thirteen weeks ended October 2, 1999, versus the comparable period
in 1998. The increase was due to greater payroll and payroll taxes
($1,165,000), depreciation ($200,000), credit card fees($63,000), insurance
($40,000) and licenses and taxes ($66,000), and was partially offset by
a reduction in freight expense ($33,000). As a percentage of sales, these
expenses increased 1.0% (35.9% versus 34.9%) for the thirteen weeks ended
October 2, 1999 versus the similar 1998 period. The increase was due primarily
to the increase in S,G&A expenses, while comparative store sales increased by
1%. The previously mentioned increase in the size of the buying staff also
contributed to higher S,G&A expenses in the thirteen week Fiscal 1999 period.
12
<PAGE>
Interest and other income, net
- ------------------------------
Interest and other income increased to $212,000 from $145,000 for the
thirty-nine week period. The increase is primarily due to the higher cash flow
levels the Company is generating. Interest and other income decreased from
$52,000 to $16,000 for the thirteen week period primarily due to a loss of
$51,000, related to the closing of a store.
Income taxes
- ------------
The Company's effective tax rate is approximately 41% for Fiscal 1999 and
1998, respectively.
PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
(a)The annual meeting of shareholders of the Company was held on
October 19, 1999.
(b)All members of the current Board of Directors were re-elected as
such for the next ensuing year. The names of each elected
Director are: Andrew M. Saul, Joseph E. Saul, Morton J.
Schrader, Mark E. Goldberg, Mae Soo Hoo, Thomas E. Reinckens and
Roy C. Smith.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
NONE
(b) Reports on Form 8-K
NONE
13
<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)
November 17, 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)
14
<PAGE>
<TABLE>
EXHIBIT 11.1
CALCULATION OF BASIC AND DILUTED EARNINGS PER COMMON SHARE
(In thousands except per share data)
<CAPTION>
THIRTY- NINE THIRTEEN
WEEKS ENDED WEEKS ENDED
---------------------------------- --------------------------------------
October 2, September 26, October 2, September 26,
1999 1998 1999 1998
---------------------------------- --------------------------------------
<S> <C> <C> <C> <C>
EARNINGS
--------
Net Income (Loss) Applicable
to Common Stockholders $ 1,455,000 $ 882,000 $ (756,000) $ (379,000)
================================== ======================================
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 $0.16 $0.10 ($0.08) ($0.04)
================================== ======================================
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 --- ---
Less Assumed Repurchase
of Common Stock Pursuant
to the Treasury Stock Method (370,000) (399,000) --- ---
---------------------------------- --------------------------------------
Weighted Average Number of
Common Shares Outstanding
As Adjusted 9,321,000 9,168,000 9,091,000 9,091,000
================================== ======================================
Diluted Earnings Per Share $0.16 $0.10 ($0.08) ($0.04)
================================== ======================================
</TABLE>
15
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JAN-01-2000
<PERIOD-END> OCT-02-1999
<CASH> 6448000
<SECURITIES> 0
<RECEIVABLES> 2280000
<ALLOWANCES> 0
<INVENTORY> 25031000
<CURRENT-ASSETS> 32253000
<PP&E> 41230000
<DEPRECIATION> 24953000
<TOTAL-ASSETS> 53165000
<CURRENT-LIABILITIES> 20194000
<BONDS> 0
<COMMON> 91000
0
0
<OTHER-SE> 29260000
<TOTAL-LIABILITY-AND-EQUITY> 53165000
<SALES> 110790000
<TOTAL-REVENUES> 110790000
<CGS> 72464000
<TOTAL-COSTS> 72464000
<OTHER-EXPENSES> 35968000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (107000)
<INCOME-PRETAX> 2465000
<INCOME-TAX> 1010000
<INCOME-CONTINUING> 1455000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1455000
<EPS-BASIC> 0.16
<EPS-DILUTED> 0.16
</TABLE>
