UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended February 29, 2000
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 _____________0-4339_____________________________
GOLDEN ENTERPRISES, INC.
______________________________________________________
(Exact name of registrant as specified in its charter )
DELAWARE 63-0250005
_______________________________ ___________________
(State or other jurisdiction of (I. R. S. Employer
incorporation or organization) Identification No.)
Suite 212, 2101 Magnolia Avenue, South
Birmingham, Alabama 35205
________________________________________ __________
(Address of Principal Executive Offices) (Zip Code)
(205) 326-6101
____________________________________________________
(Registrant's telephone number, including area code)
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 [ ]
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of March 31, 2000.
Outstanding at
Class March 31, 2000
_____ _________________
Common Stock, Par Value $0.66 2/3 12,160,000
<PAGE>
GOLDEN ENTERPRISES, INC.
INDEX
Part I. Financial Information Page No.
Consolidated Condensed Balance Sheets -
February 29, 2000 and May 31, l999 3
Consolidated Condensed Statements of Income -
Three Months and Nine Months Ended
February 29, 2000 and February 28, 1999 4
Consolidated Condensed Statements of Cash
Flows - Nine Months Ended
February 29, 2000 and February 28, 1999 5
Notes to Consolidated Condensed Financial
Statements 6
Management's Discussion and Analysis of Financial
Condition and Results of Operations 7, 8
Part II. Other Information 9
<PAGE>
PART I. FINANCIAL INFORMATION
<TABLE>
GOLDEN ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
<CAPTION>
February 29, May 31,
2000 1999
____________ _________
(Unaudited) (Audited)
ASSETS
<S> <C> <C>
Cash and cash equivalents $ 607,609 $ 227,120
Investment Securities $ 2,123,109 $ 61,941
Receivables, net $ 9,462,426 $10,235,523
Inventories:
Raw material and supplies $ 2,278,201 $ 2,224,946
Finished goods $ 2,291,247 $ 2,403,663
___________ ___________
$ 4,569,448 $ 4,628,609
___________ ___________
Current assets:
Prepaid expenses $ 3,715,206 $ 2,348,975
___________ ___________
Total current assets $20,477,798 $17,502,168
___________ ___________
Property, plant and equipment, net $19,410,738 $21,525,086
Other assets $ 2,884,498 $ 2,884,498
___________ ___________
$42,773,034 $41,911,752
___________ ___________
___________ ___________
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes payable, principally to banks $ 0 $ 0
Accounts payable & checks outstanding
in excess of bank balance $ 5,390,817 $ 4,652,089
Accrued and deferred income taxes $ 346,721 $ 255,820
Other accrued expenses $ 945,562 $ 952,366
Current installments of long-term debt $ 0 $ 0
___________ ___________
Total current liabilities $ 6,683,100 $ 5,860,275
___________ ___________
Long-term debt less current maturities $ 1,778,074 $ 1,579,453
___________ ___________
Deferred income taxes $ 1,885,299 $ 1,968,005
___________ ___________
Stockholder's Equity:
Common Stock - $.66 - 2/3 par value:
35,000,000 shares Authorized
Issued 13,828,793 shares $ 9,219,195 $ 9,219,195
Additional paid-in capital $ 6,499,554 $ 6,499,554
Retained earnings $26,287,854 $26,361,690
___________ ___________
$42,006,603 $42,080,439
Less: Cost of common shares in treasury
(1,668,793 at February 29, 2000 and
1,667,843 shares at May 31, 1999) $(9,580,042) $(9,576,420)
___________ ___________
Total stockholders' equity $32,426,561 $32,504,019
___________ ___________
Total $42,773,034 $41,911,752
___________ ___________
___________ ___________
<FN>
See Accompanying Notes to Consolidated Condensed Financial Statements
</FN>
</TABLE>
<PAGE>
<TABLE>
GOLDEN ENTERPRISES, INC. & SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(UNAUDITED)
<CAPTION>
Three Months Ended Nine Months Ended
February 29, February 28 February 29, February 28,
____________________________ ____________________________
2000 1999 2000 1999
____________ ___________ ___________ ____________
<S> <C> <C> <C> <C>
REVENUES:
Net Sales $33,088,554 $33,781,343 $95,346,576 $96,144,208
Other operating revenues $ 119,199 $ 298,175 $ 309,441 $ 469,257
Investment income $ 12,155 $ 1,365 $ 27,714 $ 61,848
___________ ___________ ___________ ___________
Total revenues $33,219,908 $34,080,883 $95,683,731 $96,675,313
___________ ___________ ___________ ___________
COSTS AND EXPENSES:
Cost of sales $15,013,734 $15,899,497 $43,430,570 $45,116,645
Selling, general and administrative expense $16,567,026 $17,889,385 $48,891,532 $50,216,560
Interest $ 0 $ 0 $ 0 $ 0
___________ ___________ ___________ ___________
Total costs and expenses $31,580,760 $33,788,882 $92,322,102 $95,333,205
___________ ___________ ___________ ___________
Income before income taxes $ 1,639,148 $ 292,001 $ 3,361,629 $ 1,342,108
Income taxes $ 609,783 $ 106,824 $ 1,246,665 $ 466,121
___________ ___________ ___________ ___________
Net income $ 1,029,365 $ 185,177 $ 2,114,964 $ 875,987
PER SHARE OF COMMON STOCK:
Net Income $ 0.08 $ 0.01 $ 0.17 $ 0.07
___________ ___________ ___________ ___________
___________ ___________ ___________ ___________
Weighted average number of common
shares outstanding 12,160,000 12,160,950 12,160,149 12,174,445
___________ ___________ ___________ ___________
___________ ___________ ___________ ___________
Cash dividend paid per share of common stock $ 0.06 $ 0.06 $ 0.18 $ 0.30
___________ ___________ ___________ ___________
___________ ___________ ___________ ___________
<FN>
See Accompanying Notes to Consolidated Condensed Financial Statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
GOLDEN ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<CAPTION>
NINE MONTHS ENDED
February 29, February 28,
____________________________
2000 1999
___________ ___________
<S> <C> <C>
Cash flows from operating activities:
Net income $ 2,114,964 $ 875,987
Adjustment to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization $ 2,500,997 $ 2,461,639
Compensation related to stock plan $ 0 $ 0
Salary Continuation Benefits $ 198,621 $ 221,183
Deferred income taxes $ (82,706) $ 23,823
Gain on sale of equipment $ (157,087) $ (376,975)
Changes in operating assets and liabilities:
Decrease (increase) in accounts receivable $ 773,097 $ 638,176
Decrease (increase) in inventories $ 59,161 $ (13,612)
Decrease (increase) in prepaid expenses $(1,366,231) $(1,287,480)
Decrease (increase) in other assets-long term $ 0 $ (1)
Increase (decrease) in accounts payable
and checks outstanding in excess of
bank balances $ 738,728 $ 659,541
Increase (decrease) in accrued income taxes $ 90,901 $ (213,813)
Increase (decrease) in accrued expenses $ (6,804) $ (392,377)
___________ ___________
$ 4,863,641 $ 2,596,091
___________ ___________
Cash flows from investing activities:
Purchase of property, plant and equipment $ (714,037) $(1,301,573)
Proceeds from sale of equipment $ 484,475 $ 519,512
Net decrease (increase) in investment securities $(2,061,168) $ 2,496,988
___________ ___________
Net cash provided by (used in)
investing activities $(2,290,730) $ 1,714,927
___________ ___________
Cash flows from financing activities:
Payments of current installments of long-term debt $ 0 $ 0
Purchase of treasury stock $ (3,622) $ (274,887)
Proceeds from sale of treasury stock $ 0 $ 0
Cash dividend paid $(2,188,800) $(3,653,665)
___________ ___________
Net cash used in financing activities $(2,192,422) $(3,928,552)
___________ ___________
Net (decrease) increase in cash and cash equivalents $ 380,489 $ 382,466
Cash and cash equivalents at beginning of year $ 227,120 $ 114,869
___________ ___________
Cash and cash equivalents at end of quarter $ 607,609 $ 497,335
___________ ___________
___________ ___________
Supplemental information:
Cash paid during the year for:
Income taxes $ 1,015,587 $ 966,262
Interest $ 0 $ 0
<FN>
See Accompanying Notes to Consolidated Condensed Financial Statements.
</FN>
</TABLE>
<PAGE>
GOLDEN ENTERPRISES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
1. In the opinion of management, the accompanying unaudited consolidated
condensed financial statements contain all adjustments (consisting of
only normal recurring accruals) necessary to present fairly its
financial position as of February 29, 2000 and May 31, 1999, and its
results of operations for the three months and nine months ended
February 29, 2000 and February 28, 1999 and its cash flows for the
nine months ended February 29, 2000 and February 28, 1999.
The accounting policies followed by the Company are set forth in
note 1 to the Company's financial statements in the Annual Report
to stockholders for fiscal year ended May 31, l999 which is
incorporated by reference in Form 10-K.
2. The results of operations for the three months and nine months ended
February 29, 2000 and February 28, 1999 are not necessarily
indicative of the results to be expected for the full year.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
Working Capital was $11.6 million at June 1, 1999 and $13.8 million at
the end of the third quarter. Net cash provided by operating activities
amounted to $4.9 million for the nine months this year compared to $2.6
million for last year's first nine months.
Additions to property, plant and equipment, net of disposals, were $0.26
million this year and $1.2 million last year. Cash dividends of $2.19 million
were paid during this year's first nine months compared to $3.65 million last
year. Cash in the amount of $0.0036 million was used to purchase treasury
stock this year, and $0.27 was used last year, and $2.06 million of cash was
used to increase investment securities this year compared to a net decrease
in investment securities providing $2.50 million of cash last year. The
Company's current ratio was 3.06 to 1.00 at February 29, 2000.
Operating Results
For the three months ended February 29, 2000, total revenues decreased
2.53% from the comparable period in fiscal 1999. This year's third quarter
included fourteen weeks of snack food sales and costs. Without the extra
week, total revenues would have been down 9%. Cost of sales was 45.4% of net
sales compared to 47.1% last year. The Company's restructuring plan has
already realized a positive impact on earnings. In addition, favorable
trends in selling and delivery costs, commodity prices and packaging
costs continued to improve earnings. Selling, general and administrative
expenses were 50.1% of net sales this year and 53.0% last year.
For the year-to-date, total revenues decreased 1.03% from the
comparable period in fiscal 1999. Cost of sales was 45.6% of net sales
compared to 46.9% last year. Selling, general and administrative
expenses were 51.3% of net sales this year and 52.2% last year.
The Company's third quarter investment income as a percentage of
pre-tax income was 0.74% this year compared to 0.47% last year. There
was an actual dollar increase in investment income of 790.5%, and pre-tax
income increased 461.4%.
For the nine months, investment income was 0.82% of pre-tax income
this year and 4.6% last year. For the nine months investment income
dollars decreased 55.2% and pre-tax income increased 150.5%.
The Company's effective tax rate for the third quarter was 37.2%
compared to 36.6% for last year's third quarter and 37.1% versus 34.7%
for the nine months.
Market Risk
The principal market risks (i.e., the risk of loss arising from adverse
changes in market rates and prices) to which the Company is exposed are
interest rates on its investment securities, and commodity prices, affecting
the cost of its raw materials.
The Company's investment securities consist of short-term marketable
securities. Presently these are variable rate money market mutual funds.
Assuming February 29, 2000 variable rate investment levels, a one-point
change in interest rates would impact interest income by $21,231 on
an annual basis.
The Company is subject to market risk with respect to commodities
because its ability to recover increased costs through higher pricing
may be limited by the competitive environment in which it operates.
The Company purchases its raw materials on the open market, under contract
through brokers and directly from growers. Future contracts have been
used occasionally to hedge immaterial amounts of commodity purchases
but none are presently being used.
Year 2000 Compliance
The Company is well in the Year 2000 on the filing date of this
report and there have been no Year 2000 Compliance problems.
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(b) Reports on Form 8-K - There were no reports on form 8-K
filed for the three months ended February 29, 2000.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GOLDEN ENTERPRISES, INC.
(Registrant)
Dated: April 11, 2000 /s/ John S. Stein
_______________________________________
John S. Stein
Chairman and
Chief Executive Officer
Dated: April 11, 2000 /s/ John H. Shannon
_______________________________________
John H. Shannon
Vice President/Controller
(Principal Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAY-31-2000
<PERIOD-END> FEB-29-2000
<CASH> 607,609
<SECURITIES> 2,123,109
<RECEIVABLES> 9,600,426
<ALLOWANCES> 138,000
<INVENTORY> 4,569,448
<CURRENT-ASSETS> 20,477,798
<PP&E> 82,879,393
<DEPRECIATION> 63,468,655
<TOTAL-ASSETS> 42,773,034
<CURRENT-LIABILITIES> 6,683,100
<BONDS> 0
0
0
<COMMON> 9,219,195
<OTHER-SE> 23,207,366
<TOTAL-LIABILITY-AND-EQUITY> 42,773,034
<SALES> 95,346,576
<TOTAL-REVENUES> 95,683,731
<CGS> 43,430,570
<TOTAL-COSTS> 92,322,102
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 27,000
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 3,361,629
<INCOME-TAX> 1,246,665
<INCOME-CONTINUING> 2,114,964
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,114,964
<EPS-BASIC> .17
<EPS-DILUTED> .17
</TABLE>
