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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 10-Q/A No. 1
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 8, 1995
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from
Commission File No. 1-6068
RINI-REGO SUPERMARKETS, INC.
(Exact name of Registrant as specified in its charter)
Ohio 34-0222970
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5300 Richmond Road, Bedford Heights, Ohio 44146
(Address of principal executive offices)
Registrant's telephone number, including area code: (216) 292-7000
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Sections 12, 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.
Outstanding at
May 8, 1995
Common Stock, No par value 3,536,577
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<TABLE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
RINI-REGO SUPERMARKETS, INC AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands of dollars)
<CAPTION>
4/8/95 7/2/94
ASSETS ---------- ----------
(unaudited)
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 3,535 $ 4,376
Trade accounts receivable, net 40,603 38,460
Inventories 72,855 74,279
Deferred income taxes 6,583 6,583
Prepaid expenses 5,412 4,838
---------- ----------
128,988 128,536
PROPERTY, EQUIPMENT AND CAPITAL LEASES 182,048 173,841
Less-Allowances for depreciation, amorti-
zation and loss on disposal of fixed assets 66,009 65,308
---------- ----------
116,039 108,533
OTHER ASSETS:
Notes receivable 9,622 10,851
Deferred income taxes 7,062 7,062
Other 2,130 2,535
---------- ----------
18,814 20,448
---------- ----------
TOTAL ASSETS $ 263,841 $257,517
========== ==========
</TABLE>
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<TABLE>
<CAPTION>
4/8/95 7/2/94
---------- ----------
(unaudited)
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C> <C>
CURRENT LIABILITIES:
Accounts payable $ 49,819 $ 45,614
Accrued expenses 39,780 29,911
Current portion of long-term liabilities 9,775 10,035
---------- ----------
99,374 85,560
LONG-TERM LIABILITIES:
Debt 57,869 71,274
Capital lease obligations 12,253 12,404
Self insurance reserves 10,714 10,531
OTHER LIABILITIES 11,184 13,067
STOCKHOLDERS' EQUITY:
Preferred Stock--18,044 shares 1,804 1,804
Class A Common Stock--7,125,287 shares 71 71
Class B Common Stock--955,613 shares 10 10
Paid-in capital 35,546 35,546
Retained earnings 35,016 27,250
---------- ----------
72,447 64,681
---------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 263,841 $257,517
========== ==========
<FN>
The accompanying Notes to Consolidated Condensed Financial
Statements are an integral part of these balance sheets.
</TABLE>
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<TABLE>
RINI-REGO SUPERMARKETS, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(In thousands of dollars, except share and per share data)
(unaudited)
<CAPTION>
40 Weeks Ended 12 Weeks Ended
4/8/95 4/9/94 4/8/95 4/9/94
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
NET SALES $ 904,224 $ 858,228 $ 275,405 $ 259,490
COST OF GOODS SOLD 726,073 694,623 220,564 210,276
--------- --------- --------- ---------
Gross profit 178,151 163,605 54,841 49,214
SELLING, GENERAL &
ADMINISTRATIVE EXPENSE 160,168 148,514 48,517 45,114
RESTRUCTURING CHARGE - 12,000 - 12,000
--------- --------- --------- ---------
Operating income (loss) 7,983 3,091 6,324 (7,900)
INTEREST EXPENSE (5,901) (5,855) (1,811) (1,837)
INTEREST INCOME 952 580 310 173
--------- --------- --------- ---------
INCOME (LOSS) BEFORE
CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING
PRINCIPLE AND INCOME
TAXES 13,034 (2,184) 4,823 (9,564)
PROVISION (CREDIT) FOR
INCOME TAXES 5,160 (790) 1,920 (3,690)
--------- --------- --------- ---------
INCOME (LOSS) BEFORE
CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING
PRINCIPLE 7,874 (1,394) 2,903 (5,874)
CUMULATIVE EFFECT OF CHANGE
IN ACCOUNTING PRINCIPLE:
Accounting for income
taxes - 6,866 - -
--------- --------- --------- ---------
NET INCOME (LOSS) 7,874 5,472 2,903 (5,874)
LESS PREFERRED STOCK
DIVIDENDS 108 108 36 36
--------- --------- --------- ---------
NET INCOME (LOSS)
APPLICABLE TO COMMON
STOCKHOLDERS $ 7,766 $ 5,364 $ 2,867 $ (5,910)
========= ========= ========= =========
</TABLE>
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<TABLE>
<CAPTION>
40 Weeks Ended 12 Weeks Ended
4/8/95 4/9/94 4/8/95 4/9/94
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
PER SHARE DATA:
INCOME (LOSS) BEFORE
CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING
PRINCIPLE $ .96 $ (.19) $ .35 $ (.73)
CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING
PRINCIPLE - .85 - -
--------- --------- --------- ---------
NET (LOSS) INCOME $ .96 $ .66 $ .35 $ (.73)
========= ========= ========= =========
COMMON STOCK DIVIDENDS - - - -
========= ========= ========= =========
WEIGHTED AVERAGE NUMBER
OF COMMON SHARES
OUTSTANDING 8,080,900 8,080,901 8,080,900 8,080,901
========= ========= ========= =========
<FN>
The accompanying Notes to Consolidated Condensed Financial
Statements are an integral part of these statements.
</TABLE>
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<TABLE>
RINI-REGO SUPERMARKETS, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(In thousands of dollars)
(unaudited)
<CAPTION>
40 Weeks Ended 12 Weeks Ended
4/8/95 4/9/94 4/8/95 4/9/94
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income (loss) $ 7,874 $ 5,472 $ 2,903 $ (5,874)
Adjustments to reconcile
net income (loss) to
net cash provided
by (used for)
operating activities:
Depreciation & amort. 13,489 11,189 4,445 3,436
Cumulative effect of
change in accounting
principle - (6,866) -
Changes in assets
and liabilities 12,231 (15,747) (1,088) (5,605)
--------- --------- --------- ---------
Net cash provided by
(use for) operating
activities 33,594 (5,952) 6,260 (8,043)
--------- --------- --------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Purchases of fixed
assets (22,487) (19,255) (6,538) (4,201)
Proceeds from sales of
fixed assets 2,110 539 1,947 84
--------- --------- --------- ---------
Net cash used for
investing
activities (20,377) (18,716) (4,591) (4,117)
--------- --------- --------- ---------
</TABLE>
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<TABLE>
<CAPTION>
40 Weeks Ended 12 Weeks Ended
4/8/95 4/9/94 4/8/95 4/9/94
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
CASH FLOWS FROM FINANCING
ACTIVITIES:
Borrowings under
revolving lines of
credit $ 501,017 $ 682,182 $ 152,800 $ 260,142
Repayments of revolving
lines of credit (509,405) (658,267) (151,756) (248,037)
Additions to mortgage
notes payable - 2,621 - 13
Reduction of long-term
debt (5,411) (4,166) (2,208) (577)
Additions to capital
lease obligations 1,425 2,591 - 962
Repayments of capital
lease obligations (1,576) (1,263) (501) (413)
Preferred stock dividends (108) (108) (36) (36)
--------- --------- --------- ---------
Net cash provided by
(used for) financing
activities (14,058) 23,590 (1,701) 12,054
--------- --------- --------- ---------
NET DECREASE IN CASH
AND CASH EQUIVALENTS (841) (1,078) (32) (106)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 4,376 4,394 3,567 3,422
--------- --------- --------- ---------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 3,535 $ 3,316 $ 3,535 $ 3,316
========= ========= ========= =========
SUPPLEMENTAL DATA:
Interest Paid $ 5,785 $ 5,421 $ 1,570 $ 1,510
========= ========= ========= ========
Income Taxes Paid $ 4,595 $ 5,601 $ 2,113 $ 2,909
========= ========= ========= ========
<FN>
The accompanying Notes to Consolidated Condensed Financial
Statements are an integral part of these statements.
</TABLE>
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RINI-REGO SUPERMARKETS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
APRIL 8, 1995
(1) Basis of Presentation:
The accompanying unaudited consolidated condensed financial
statements have been prepared in accordance with the instructions
to Form 10-Q and therefore do not include all information and
footnotes necessary for a fair presentation of financial position,
results of operations and cash flows in conformity with generally
accepted accounting principles. The results of operations for the
twelve and forty weeks ended April 8, 1995 are not necessarily
indicative of the results to be expected for the fiscal year ending
July 1, 1995. In the opinion of management, the accompanying
unaudited consolidated condensed financial statements contain all
adjustments necessary for a fair statement of the financial
position at the dates indicated and of the results of operations
for the interim periods presented.
Rini-Rego Supermarkets, Inc. ("RRS" or the "Company"),
formerly known as Fisher Foods, Inc., is a wholly owned subsidiary
of Riser Foods, Inc. ("Riser"). The accompanying financial
statements of the Company are presented on the "push down
accounting" basis, for financial reporting purposes only, with the
equity section of the accompanying balance sheet reflecting the
equity of Riser. The separate financial statements of the Company
would reflect the following stockholders' equity amounts (in
thousands):
4/8/95 7/2/94
-------- --------
Preferred Stock $ 1,811 $ 1,811
Common stock 1,403 1,403
Paid-in capital 22,714 22,714
Retained earnings 45,045 37,279
-------- --------
$70,973 $63,207
======== ========
(2) Debt:
The Company's bank credit facilities (the Facilities), which
were increased by $10.0 million during the first quarter of 1995,
provide for revolving lines of credit and letters of credit up to
an aggregate of $69.0 million and a term loan which currently has
$8.6 million outstanding. The Company increased its availability
to meet the needs of its store remodelling and expansion plans.
The Facilities are secured by substantially all of the Company's
assets. Facility fees and interest are paid monthly. Available
unused borrowing capacity under the Facilities at April 8, 1995 was
approximately $23.2 million.
Subsequent to the end of the third quarter of fiscal 1995, the
Facilities were amended, principally to extend the due date for
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borrowings under the revolving lines of credit to July 6, 1998 and
to adjust the financial covenants to accommodate the Company's
store remodelling and expansion plans. The amendment also provides
for the Company's option to borrow funds under its revolving lines
of credit and term loan at either .25% over the Bank's Prime
Interest Rate or 2.50% over LIBOR.
(3) Change in Accounting Principle - Accounting for Income Taxes:
During the first quarter of fiscal 1994, the Company adopted
Statement of Financial Accounting Standards No. 109, "Accounting
for Income Taxes" (SFAS No. 109). This statement requires that the
liability method of accounting for income taxes be used rather than
the deferred method previously used. The Company elected not to
restate prior years' financial statements. The cumulative effect
of this accounting change was to increase fiscal 1994 first quarter
earnings by $6,866,000 or $.85 per share. The cumulative effect is
principally the result of benefitting the expected utilization of
net operating loss carryforwards (NOLs) and the adjustment of
deferred tax balances to reflect changes in statutory rates.
Significant components of the Company's net deferred tax asset
as of April 8, 1995 and July 2, 1994 are as follows (in thousands):
<TABLE>
<CAPTION>
<S> <C>
DEFERRED TAX LIABILITIES:
Property, equipment
and capital leases $ (5,619)
State and local taxes other
than income (459)
---------
(6,078)
DEFERRED TAX ASSETS:
Reserve for uncollectible
accounts 1,280
Closed facilities reserves 6,123
Self insurance reserves 4,858
Employees' retirement benefits 1,058
Accruals not currently deductible 2,296
Net operating loss carryforwards 7,782
Other 974
---------
24,371
VALUATION ALLOWANCE (4,648)
---------
NET DEFERRED TAX ASSET $ 13,645
=========
</TABLE>
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The Company has gross NOLs totaling $22,890,000 which expire
as follows (in thousands):
<TABLE>
<CAPTION>
Year NOL
---- --------
<S> <C>
2000 $ 643
2001 16,859
2002 5,388
--------
$22,890
========
</TABLE>
SFAS No. 109 requires that the tax benefit of such NOLs be
recognized as an asset to the extent the Company assesses the
utilization of such NOLs to be "more likely than not". Based upon
the Company's history of prior earnings, expectation for future
earnings and tax regulations which limit the annual amount of NOLs
available for deduction, the Company does not believe the entire
amount of NOLs will be utilized before they expire. As such, a
valuation reserve of $4,648,000 has been established due to the
uncertainty of future NOL realization.
The Company's Statements of Operations for the twelve and
forty weeks ended April 8, 1995 and April 9, 1994 reflect income
tax provisions at the various statutory income tax rates to which
the Company is subject. There were no significant differences
between financial reporting and taxable income.
(4) Employee Stock Option Plan:
On February 14, 1995, the Company granted options to several
key employees to purchase 226,500 shares of Class A Common Stock
(the 1995 Options) under the Company's Stock Incentive Plan. The
exercise price of the 1995 Options is $7.25 per share of Class A
Common Stock which approximated fair market value at the date of
grant. The 1995 Options will not become exercisable until February
14, 1997 (except in certain limited circumstances) and will expire
on February 14, 2005 if not exercised. The 1995 Options are non-
qualified options for Federal Income Tax purposes.
(5) Restructuring Charge:
The Company provides for the estimated costs of closing
facilities concurrent with making the decision to close facilities.
The types of costs provided in these restructuring charges include
anticipated losses on the disposal of fixed assets, employee
severance costs and other benefits for terminated employees,
estimated withdrawal liabilities for multi-employer pension plans
and future lease payments net of estimated sublease income.
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The $12 million Restructuring Charge recorded during the third
quarter of fiscal 1994 reflected costs associated with the
Company's store consolidation plan in which the Company planned to
close 14 small, outdated Company-operated retail stores comprised
of approximately 456,000 square feet. These locations will be
replaced by seven newer, larger facilities representing
approximately 431,000 square feet. Two of these newer locations
will be operated by independently-owned retailers and the remaining
five will be new or expanded Company-operated retail stores. At
April 8, 1995, the Company has closed eight of the stores included
in the 1994 Restructuring Charge with the remaining six stores to
be closed over the next three years.
SIGNATURES
Pursuant to the requirements of section 12, 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this Amendment to be signed on its behalf by the undersigned,
thereunto duly authorized.
RINI-REGO SUPERMARKETS, INC.
(Registrant)
/s/ Ronald W. Ocasek
May 24, 1995 By: Ronald W. Ocasek
Chief Financial Officer and
Treasurer, (Principal
Accounting Officer)
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