<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended April 30, 1996
--------------
[ ] 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 0-8568
BESTWAY, INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 81-0332743
---------- ------------
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
7800 Stemmons, Suite 320, Dallas, Texas 75247
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(214) 630-6655
----------------------------------------------------
(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
----- -----
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Number of shares: 1,615,717
As of April 30, 1996
<PAGE> 2
BESTWAY, INC.
QUARTERLY REPORT TO THE SECURITIES AND EXCHANGE COMMISSION
FOR THE QUARTER ENDED
April 30, 1996
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION PAGE NO.
--------
<S> <C>
ITEM 1. Consolidated Unaudited Financial Statements 3-7
ITEM 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8-11
PART II - OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K, Signatures 11-12
</TABLE>
Page 2 of 12
<PAGE> 3
BESTWAY, INC.
Consolidated Balance Sheets
<TABLE>
<CAPTION>
ASSETS April 30, July 31,
1996 1995
------------ ------------
(Unaudited)
<S> <C> <C>
Cash $ 354,335 $ 329,342
Restricted cash 119,342 119,342
Investments 814,638 --
Prepaid expenses 295,382 129,311
Deferred tax assets 1,778,850 2,013,784
Other assets 131,388 209,506
13,283,254 10,596,609
4,296,178 4,189,727
Rental merchandise, at cost ----------- -----------
Less accumulated depreciation 8,987,076 6,406,882
----------- -----------
4,220,536 3,584,071
2,144,159 1,702,486
Property and equipment, at cost ----------- -----------
Less accumulated depreciation 2,076,377 1,881,585
----------- -----------
Non-compete, net of amortization 731,641 581,977
Goodwill, net of amortization 2,771,576 2,038,166
----------- -----------
Total assets $18,060,605 $13,709,895
=========== ===========
LIABILITIES AND EQUITY
Accounts payable $ 1,597,592 $ 718,861
Accrued interest - related parties 11,615 12,013
Accrued interest - other 29,555 22,043
Income taxes payable 80,554 85,061
Other accrued liabilities 1,258,663 760,322
Notes payable - related parties 3,600,000 3,600,000
Notes payable - other 4,534,275 2,470,302
Commitments and contingencies
Stockholders' Equity:
Preferred stock, $10.00 par value;
1,000,000 shares authorized, none issued
Common stock, $.01 par value; 20,000,000
authorized; 1,615,717 issued
outstanding at April 30, 1996 and -- --
July 31, 1995, respectively 16,157 15,001
15,419,990 14,842,911
Paid-in capital (8,487,796) (8,816,619)
Accumulated deficit ----------- -----------
Total equity 6,948,351 6,041,293
----------- -----------
Total liabilities and equity $18,060,605 $13,709,895
=========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 3 of 12
<PAGE> 4
BESTWAY, INC.
Consolidated Statements of Income
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
----------------------- ------------------------
April 30, April 30, April 30, April 30,
---------- ---------- ----------- -----------
1996 1995 1996 1995
---------- ---------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues
Rental revenue $4,521,249 $4,164,939 $12,813,278 $12,003,807
Sales of merchandise and other 74,589 64,244 366,121 123,500
---------- ---------- ----------- -----------
4,595,838 4,229,183 13,179,399 12,127,307
---------- ---------- ----------- -----------
Cost and operating expenses
Depreciation and amortization -
Rental merchandise 1,072,287 1,002,933 3,057,516 2,933,569
Other 264,118 240,035 770,341 695,642
Cost of sales 69,392 59,540 313,082 110,873
Salaries and wages 1,126,830 992,111 3,269,514 2,935,233
Advertising 186,668 186,953 505,208 533,261
Occupancy 231,990 181,323 629,949 554,298
Other operating expenses 1,285,468 1,177,486 3,603,273 3,302,396
(Gain) loss on property and equipment (5,643) (5,563) 21,568 (6,123)
Interest expense 130,895 131,665 378,717 386,453
---------- ---------- ----------- -----------
4,362,005 3,966,483 12,549,168 11,445,602
---------- ---------- ----------- -----------
Net income before income tax provision $ 233,833 $ 262,700 $ 630,231 $ 681,705
---------- ---------- ----------- -----------
Income tax provision
Current 36,188 17,706 66,475 50,730
Deferred 81,549 -- 234,933 --
---------- ---------- ----------- -----------
Net income $ 116,096 $ 244,994 $ 328,823 $ 630,975
========== ========== =========== ===========
Net income per share $ .08 $ .16 $ .22 $ .42
---------- ---------- ----------- -----------
Weighted average common
shares outstanding 1,538,619 1,500,070 1,512,920 1,502,963
========== ========== =========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 4 of 12
<PAGE> 5
BESTWAY, INC.
Consolidated Statements of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
-------------------------
April 30, April 30,
1996 1995
------------ -----------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 328,823 $ 630,975
Depreciation and amortization 3,827,854 3,629,210
Net book value of rental units retired 874,612 617,195
Loss (gain) on property and equipment 31,072 (6,123)
Deferred tax asset 234,934 --
Other -- (3,710)
Change in asset and liability accounts other than cash:
Prepaid expenses (164,398) (55,319)
Other assets (36,032) (49,252)
Non-compete (287,500) --
Accounts payable 458,834 43,773
Accrued interest payable 7,114 3,758
Income tax payable (4,507) 3,793
Other accrued liabilities 429,733 (2,364)
----------- ----------
Total adjustments 403,244 (55,611)
----------- ----------
Net cash flows from operating activities: 5,700,539 4,811,936
----------- ----------
Cash flows from investing activities:
Purchase of rental units (4,856,330) (4,481,908)
Additions to property and equipment (753,268) (477,712)
Proceeds from sale of property 14,978 24,720
Purchase of investments (555,266) --
----------- ----------
Net cash flows used in investing activities: (6,149,886) (4,934,900)
----------- ----------
Cash flows from financing activities:
Proceeds of notes payable 3,393,410 896,800
Repayment of notes payable (2,919,070) (799,904)
----------- ----------
Net cash flows provided by financing activities: 474,340 96,896
----------- ----------
Cash at August 1, 1995 and 1994, respectively 329,342 273,183
----------- ----------
Cash at the end of the quarter $ 354,335 $ 247,116
=========== ==========
Supplemental cash flow information:
(See Note 4)
Fair value of assets acquired $ 2,656,373 --
Liabilities assumed and incurred 2,078,138 --
Common stock issued 578,235 --
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 5 of 12
<PAGE> 6
BESTWAY, INC.
Consolidated Statements of Stockholders' Equity
for the nine months ended April 30, 1996
(Unaudited)
<TABLE>
<CAPTION>
Common Stock Paid-In Accumulated
Shares Amount Capital Deficit
--------- --------- ----------- ------------
<S> <C> <C> <C> <C>
Balance at July 31, 1995 1,500,070 $15,001 $14,842,911 $(8,816,619)
Stock issued in
Asset Purchase Agreement 115,647 1,156 577,079
Net income for the nine months 328,823
ended April 30, 1996 --------- --------- ----------- -----------
Balance at April 30, 1996 1,615,717 $16,157 $15,419,990 $(8,487,796)
========= ========= =========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
Page 6 of 12
<PAGE> 7
BESTWAY, INC.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
1. Reference to Previous Disclosures
The consolidated financial statements included herein have been prepared
by the Company without audit. Certain information and footnote disclosure
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted or are
incorporated herein by reference to the financial statements included in the
Company's 1995 Form 10-K. Management believes that the disclosures are
adequate to make the information presented not misleading and that all
adjustments deemed necessary for a fair statement of the results for the
interim period have been reflected. It is suggested that these condensed
financial statements be read in conjunction with the financial statements and
the notes thereto included in the Company's 1995 Form 10-K, particularly with
regard to disclosure relating to significant accounting policies.
2. Reclassifications
Certain reclassifications were made to the prior year financial statements
to conform with the current year presentation.
3. Investments
During the second quarter of fiscal year 1996, the Company made a
significant investment in a partnership, as a limited partner. The partnership
provides floor plan financing.
4. Acquisition
In April 1996, the Company acquired substantially all of the assets and
certain liabilities in connection therewith of fifteen rental-purchase stores
with combined annual revenues of approximately $5,500,000. The assets acquired
by the Company include, among other things, the idle inventory, rental
contracts, vehicles, store furniture and fixtures, computers and leasehold
improvements. In addition, the Company assumed the leases of all fifteen
locations.
The Company delivered to the former owners 115,647 shares of the Company's
voting common stock, $.01 par value per share, as the aggregate purchase price
in connection with the acquisition. Such amount was based on a multiple of
average monthly revenues less certain assumed liabilities.
5. Notes Payable
In April 1996, the Company amended its First Amended and Restated
Revolving Credit Loan Agreement with its senior collateralized lender. In the
Amendment, the Company increased the maximum amount of revolving credit under
the loan agreement from $4,000,000 to $7,500,000 and extended the termination
date of the agreement by one year from August 18, 1996 to August 18, 1997.
Page 7 of 12
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Results of Operations
The following table sets forth, for the periods indicated, items from the
Company's Consolidated Statements of Income, expressed as a percentage of total
revenues.
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
April 30, April 30,
1996 1995 1996 1995
------- ------- ------ -------
<S> <C> <C> <C> <C>
Revenues
Rental revenue 98.4% 98.5% 97.2% 99.0%
Sales of merchandise and other 1.6% 1.5% 2.8% 1.0%
----- ----- ----- -----
100.0% 100.0% 100.0% 100.0%
----- ----- ----- -----
Cost and operating expenses
Depreciation and amortization -
Rental merchandise 23.3% 23.7% 23.2% 24.2%
Other 5.7% 5.7% 5.8% 5.7%
Cost of sales 1.5% 1.4% 2.4% 0.9%
Salaries and wages 24.5% 23.5% 24.8% 24.2%
Advertising 4.1% 4.4% 3.8% 4.4%
Occupancy 5.0% 4.3% 4.8% 4.6%
Other operating expenses 28.1% 27.8% 27.3% 27.3%
(Gain) loss on property and equipment (0.1)% (0.1)% 0.2% (0.1)
Interest expense 2.8% 3.1% 2.9% 3.2%
----- ----- ----- -----
94.9% 93.8% 95.2% 94.4%
----- ----- ----- -----
Net income before income tax provision 5.1% 6.2% 4.8% 5.6%
----- ----- ----- -----
Income tax provision
Current 0.8% 0.4% 0.5% 0.4%
Deferred 1.8% 0.0% 1.8% 0.0%
----- ----- ----- -----
Net income 2.5% 5.8% 2.5% 5.2%
===== ===== ===== =====
</TABLE>
Third Quarter of Fiscal 1996 Compared with Third Quarter of Fiscal 1995
Total revenues increased by $366,655 or 8.7% for the three months ended
April 30, 1996, as compared to the three months ended April 30, 1995. The
increase is due to the April 12, 1996, fifteen store acquisition, the
maturation of two stores opened during the first quarter and the acquisition of
a single store during the second quarter. The fifteen stores acquired on April
12, 1996, accounted for $263,997 (72%) of the increase in total revenues, while
the Company's two new stores and single store acquisition accounted for
$206,568 (56%) of the increase. Additionally, the Company opened a new store
in April 1996, in Lafayette, Tennessee. The Company's same store revenues
decreased $103,910 (28%) primarily due to a 1.5% decrease in the number of
units on rent, as well as, adverse winter weather conditions in February.
Page 8 of 12
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, con't.
Third Quarter of Fiscal 1996 Compared with Third Quarter of Fiscal 1995, con't.
Total costs and operating expenses increased $395,522 to $4,362,005 from
$3,966,483 primarily as a result of costs and operating expenses associated
with the acquisition of fifteen new stores and the opening of four new stores.
Depreciation expense related to rental merchandise increased by $69,354 to
$1,072,287 from $1,002,933, but decreased by 0.4% as a percentage of total
revenues. Salaries and wages increased by $134,719 to $1,126,830 from $992,111
and increased by 1.0% as a percentage of total revenues due to the addition of
key management personnel in operations, real estate management and human
resource departments added in preparation for expansion. Occupancy expense
increased $50,667 to $231,990 from $181,323 and increased by 0.7% as a
percentage of total revenues due to the acquisition of fifteen new stores and
the opening of four new stores. Other operating expenses increased $107,982 to
$1,285,468 from $1,177,486 and increased by 0.3% as a percentage of total
revenues due to the addition of new and acquired stores.
For the three months ended April 30, 1996 compared to the three months
ended April 30, 1995, net income before income tax provision decreased $28,867
to $233,833 from $262,700, and decreased to 5.1% from 6.2% of total revenues.
The decrease is primarily attributable to the operating loss incurred by the
four new store openings and the addition of personnel as a result of the
fifteen store acquisition.
For the three months ended April 30, 1996 compared to the three months
ended April 30, 1995, income tax expense increased $100,031 to $117,737 from
$17,706 because deferred income tax expense was offset by the Company's
deferred tax asset.
Nine Months Ended April 30, 1996 Compared with Nine Months Ended April 30, 1995
Total revenues increased by $1,052,092 or 8.7% for the nine months ended
April 30, 1996, as compared to the nine months ended April 30, 1995. The
increase is due to the April 12, 1996 fifteen store acquisition, the opening of
four new stores and growth of same store revenues. In addition, the Company
acquired approximately 150 rental-purchase contracts from another rental dealer
where the Company has an existing store location. Total revenue from the
Company's rental-purchase stores increased by $844,627 or 7.1%. The fifteen
stores acquired on April 12, 1996, accounted for $263,997 (31%) of the
increase, new stores accounted for $348,296 (41%) of the increase and the
Company's same stores accounted for $232,334 (28%) of the increase.
The Company entered into the retail used car sales and finance business,
on a trial basis, in September, 1995 through the opening of a single prototype
retail sales facility. Revenues, included in sales of merchandise and other,
and operating losses from the retail used car sales and finance business were
$207,465 and $144,111, respectively for the nine months ended April 30, 1996.
The company evaluated the viability of the business over five months and
management made the decision to discontinue the additional line of business in
January, 1996 due to unfavorable operating results.
Page 9 of 12
<PAGE> 10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, con't.
Nine Months Ended April 30, 1996 Compared with Nine Months Ended April 30, 1995,
con't.
Total costs and operating expenses increased $1,103,566 to $12,549,168
from $11,445,602 primarily as a result of costs and operating expenses
associated with the acquisition of fifteen new stores and the opening of four
new stores. Depreciation expense related to rental merchandise increased by
$123,947 to $3,057,516 from $2,933,569 but decreased by 1.0% as a percentage of
total revenues. Cost of cash sales increased $202,209 to $313,082 from
$110,873 due to the retail used car sales and finance business. Salaries and
wages increased by $334,281 to $3,269,514 from $2,935,233 and increased by 0.6%
as a percentage of total revenues due to the addition of key management
personnel in operations, real estate management and human resource departments
added in preparation for expansion. Occupancy expense increased by $75,651 to
$629,949 from $554,298 due to the acquisition of fifteen new stores and the
opening of four new stores. Other operating expenses increased $300,877 to
$3,603,273 from $3,302,396 due to the retail used car sales and finance
business and the addition of new and acquired stores.
For the nine months ended April 30, 1996 compared to the nine months ended
April 30, 1995 net income before income tax provision decreased $51,417 to
$630,231 from $681,705 and decreased to 4.8% from 5.6% of total revenues. The
decrease is primarily attributable to the operating losses from the retail used
car sales and finance business and operating losses incurred by the four new
store openings.
For the nine months ended April 30, 1996 compared to the nine months ended
April 30, 1995, income tax expense increased $250,678 to $301,408 from $50,730
because deferred income tax expense was offset by the Company's deferred tax
asset.
Financial Condition, Liquidity and Capital Resources
The Company's primary source of funds to finance its business has been its
cash flows provided by operating activities and its bank borrowings. The funds
have been used primarily to purchase and carry additional rental merchandise
for existing, acquired and new rental-purchase stores.
On August 26, 1995 the Company extended its maturity on the $500,000
subordinated note payable to affiliate dated March 4, 1992 from August 31, 1995
to August 31, 1996. On October 23, 1995, the Company extended its $3,000,000
subordinated note payable to limited partnership and stockholder dated July 19,
1993. The note which terminates on July 19, 1996 was extended until August 19,
1997.
On April 12, 1996 the Company amended its First Amended and Restated
Revolving Credit Loan Agreement with its senior collateralized lender. In the
Amendment, the Company increased the maximum amount of revolving credit under
the loan agreement from $4,000,000 to $7,500,000 and extended the termination
date of the agreement by one year from August 18, 1996 to August 18, 1997.
Page 10 of 12
<PAGE> 11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS, con't.
Nine Months Ended April 30, 1996 Compared with Nine Months Ended April 30, 1995
con't.
The Company's net cash flows provided by operating activities for the nine
months ended April 30, 1996 was $5,700,539 compared to $4,811,936 for the same
period last year, a 18.5% increase. This increase was primarily due to the
Company's provision for deferred income taxes and an increase in write-offs of
rental merchandise. Cash flows used in investing activities for the nine
months ended April 30, 1996 was $6,149,886 compared to $4,934,900 for the same
period last year, a 24.6% increase. The increase is primarily the result of
increased inventory purchases and additions to property and equipment that
include the purchase of new delivery vans and leasehold improvements for the
Company's four new store locations. Cash flows provided by financing
activities for the nine months ended April 30, 1996 was $474,340 compared to
$96,896 for the same period last year. The change is primarily due to
increased net borrowings under the Company's revolving credit loan agreement.
During March 1995, the Financial Accounting Standards Board issued SFAS
No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed Of." The standard is effective for financial statements
for fiscal years beginning after December 15, 1995. The Company's analysis of
this new standard indicates that the standard should not have a material effect
on its financial position or results of operations.
Inflation
Although the Company cannot precisely determine the effects of inflation
on its business, it is management's belief that the effects on revenues and
operating results have not been significant.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K, SIGNATURES
(a) Exhibits required by Item 601 of Regulation S-K
3-1 Amended and Restated Certificate of Incorporation
27 Financial Data Schedule
Filed electronically only, not attached to printed reports
Page 11 of 12
<PAGE> 12
PART II. OTHER INFORMATION, CON'T.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K, SIGNATURES, con't.
(b) Reports on Form 8-K
(1) On April 25, 1996 the Company
filed a Form 8K disclosing that it had acquired
substantially all of the assets and certain
liabilities of fifteen rental-purchase stores, with
combined annual revenues of approximately $5.5
million. The aggregate purchase price was based on a
multiple of the fifteen stores average monthly
revenues less certain assumed liabilities in exchange
for 115,647 shares of Bestway, Inc. common stock.
(2) On April 25, 1996 the Company
filed a Form 8K disclosing that it had amended the
First Amended and Restated Revolving Credit Loan
Agreement with its senior collateralized lender where
the maximum amount of revolving credit under such loan
agreement was increased from $4,000,000 to $7,500,000
and extended the termination date of such agreement by
one year from August 18, 1996 to August 18, 1997.
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 thereunto duly authorized.
BESTWAY, INC.
June 14, 1996 /s/ Beth A. Durrett
----------------------------
Beth A. Durrett
Vice President - Controller
(Principal Financial Officer
and duly authorized to sign
on behalf of the Registrant)
Page 12 of 12
<PAGE> 13
EXHIBIT INDEX
-------------
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<S> <C>
3-1 Amended and Restated Certificate of Incorporation
27 Financial Data Schedule
</TABLE>
<PAGE> 1
DIVISION OF CORPORATIONS
FILED 03:45 PM ON 5/16/1996
960142837 - 892602
CERTIFICATE OF AMENDMENT TO THE
THIRD RESTATED CERTIFICATE OF INCORPORATION OF
BESTWAY, INC.
We, R. Brooks Reed, President, and Beth A. Durrett, Secretary, of
Bestway, Inc., a corporation existing under the laws of the State of Delaware
(the "Corporation"), do hereby certify as follows:
FIRST: That the first paragraph of Article FOURTH of the Third
Restated Certificate of Incorporation, as amended (the "Certificate of
Incorporation") of this Corporation be amended and restated in its entirety to
read as follows:
"The total number of shares of stock of all classes which the
Corporation shall have authority to issue is Six Million (6,000,000) of which
stock One Million (1,000,000) shares of the par value Ten Dollars ($10.00) per
share, shall be designated Preferred Stock, and of which Five Million
(5,000,000) shares of par value of One Cent ($0l.01) per share, shall be
designated Common Stock."
SECOND: That the foregoing amendment to the Certificate of
Incorporation was duly adopted by the unanimous written consent of the Board of
Directors of the Corporation of resolutions declaring said amendment to be
advisable, and directing such amendment to be considered at the next annual
meeting of the stockholders in order to procure its adoption and approval by
stockholders holding at least a majority of the outstanding stock of the
Corporation.
THIRD: That the foregoing amendment was authorized at the annual
meeting of stockholders, held on May 16, 1996, by holders of a majority of the
outstanding stock of the Corporation entitled to vote thereon.
FOURTH: That the foregoing amendment was duly adopted in accordance
with the applicable provisions of Section 242 of the General Corporation Law of
the State of Delaware.
FIFTH: That except as provided above, the Certificate of Incorporation
shall remain unchanged.
IN WITNESS WHEREOF, we have executed this Certificate of Amendment as
of the 16th day of May, 1996.
/s/ R. BROOKS REED
-----------------------------
R. Brooks Reed, President
ATTEST:
/s/ BETH A. DURRETT
- ----------------------
Beth A. Durrett, Secretary
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUL-31-1996
<PERIOD-START> AUG-01-1995
<PERIOD-END> APR-30-1996
<CASH> 473,677
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 13,283,254
<CURRENT-ASSETS> 0
<PP&E> 4,220,536
<DEPRECIATION> 6,440,337
<TOTAL-ASSETS> 18,060,605
<CURRENT-LIABILITIES> 0
<BONDS> 8,134,275
<COMMON> 16,157
0
0
<OTHER-SE> 6,932,194
<TOTAL-LIABILITY-AND-EQUITY> 18,060,605
<SALES> 0
<TOTAL-REVENUES> 13,179,399
<CGS> 0
<TOTAL-COSTS> 3,370,598
<OTHER-EXPENSES> 8,342,594
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 378,717
<INCOME-PRETAX> 630,231
<INCOME-TAX> 301,408
<INCOME-CONTINUING> 328,823
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 328,823
<EPS-PRIMARY> .22
<EPS-DILUTED> 0
</TABLE>
