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 April 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 000-05083
SAUCONY, INC.
(Exact name of registrant as specified in its charter)
Massachusetts 04-1465840
(State or other jurisdiction of I.R.S. employer identification number)
incorporation or organization)
13 Centennial Drive, Peabody, MA 01960
(Address of principal executive offices)
978-532-9000
(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 [ ]
Class Outstanding as of May 7, 1999
Class A Common Stock-$.33 1/3 Par Value 2,679,027
Class B Common Stock-$.33 1/3 Par Value 3,550,205
---------
6,229,232
SAUCONY, INC. AND SUBSIDIARIES
INDEX
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets as of April 2, 1999
and January 1, 1999
Condensed Consolidated Statements of Income for the
thirteen weeks ended April 2, 1999 and April 3, 1998
Condensed Consolidated Statements of Stockholders' Equity for
the thirteen weeks ended April 2, 1999 and April 3, 1998
Condensed Consolidated Statements of Cash Flows for the
thirteen weeks ended April 2, 1999 and April 3, 1998
Notes to Condensed Consolidated Financial Statements --
April 2, 1999
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Part II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
Signature
<PAGE>
<TABLE>
PART I. FINANCIAL INFORMATION
SAUCONY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
<CAPTION>
(Unaudited)
(Amounts in thousands)
ASSETS
April 2, January 1,
1999 1999
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 1,598 $ 5,495
Marketable securities 187 179
Accounts receivable 33,585 19,473
Inventories 28,319 31,072
Prepaid expenses and other current assets 3,540 2,923
--------- ----------
Total current assets 67,229 59,142
--------- ----------
Property, plant and equipment, net 8,162 8,123
--------- ----------
Other assets 2,445 2,614
--------- ----------
Total assets $ 77,836 $ 69,879
========= ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable $ 11,678 $ 7,568
Current maturities of long-term debt 360 324
Accounts payable 3,983 6,244
Accrued expenses and other current liabilities 7,670 4,704
--------- ----------
Total current liabilities 23,691 18,840
--------- ----------
Long-term obligations:
Long-term debt 516 559
Deferred income taxes 1,813 1,851
Other long-term obligations 161 157
--------- ----------
Total long-term obligations 2,490 2,567
--------- ----------
Minority interest in consolidated subsidiaries 255 222
--------- ----------
Stockholders' equity:
Common stock, $.33 1/3 par value 2,178 2,178
Additional paid in capital 15,923 15,921
Retained earnings 35,693 32,360
Accumulated translation (714) (528)
---------- -----------
Total 53,080 49,931
Less: Common stock held in treasury, at cost (1,665) (1,665)
Unearned compensation (15) (16)
---------- -----------
51,400 48,250
--------- ----------
Total liabilities and stockholders' equity $ 77,836 $ 69,879
========= ==========
See notes to condensed consolidated financial statements
</TABLE>
<TABLE>
SAUCONY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE THIRTEEN WEEKS ENDED APRIL 2, 1999 AND APRIL 3, 1998
<CAPTION>
(Unaudited)
(Amounts in thousands, except per share data)
Thirteen Weeks Thirteen Weeks
Ended Ended
April 2, 1999 April 3, 1998
<S> <C> <C>
Net sales $ 42,406 $ 29,624
Other revenue 208 42
--------- ----------
Total revenue 42,614 29,666
--------- ----------
Costs and expenses
Cost of sales 26,985 19,651
Selling expenses 5,433 4,423
General and administrative expenses 4,308 3,510
--------- ----------
Total costs and expenses 36,726 27,584
--------- ----------
Operating income 5,888 2,082
Non-operating income (expense)
Interest, net (146) (210)
Foreign currency 26 (11)
Other 24 34
--------- ----------
Income before income taxes and minority interest 5,792 1,895
Provision for income taxes 2,430 898
Minority interest in income of consolidated subsidiaries 29 23
--------- ----------
Net income $ 3,333 $ 974
========= ==========
Per share amounts:
Earnings per common share - basic $ 0.54 $ 0.16
========= ==========
Earnings per common share - diluted: $ 0.52 $ 0.16
========= ==========
Weighted average common shares and
equivalents outstanding 6,363 6,293
========= ==========
Cash dividends per share of common stock 0 0
========= ==========
See notes to condensed consolidated financial statements
</TABLE>
<PAGE>
<TABLE>
SAUCONY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE THIRTEEN WEEKS ENDED APRIL 2, 1999 AND APRIL 3, 1998
<CAPTION>
(Amounts in thousands, except share data)
Common Stock Paid-in Retained
Class A Class B Capital Earnings
<S> <C> <C> <C> <C>
Balance, January 2, 1998 $ 902 $ 1,248 $ 15,652 $ 28,781
Amortization of unearned compensation -- -- -- --
Net income -- -- -- 974
Foreign currency translation adjustments -- -- -- --
-------- -------- -------- ---------
Balance, April 3, 1998 $ 902 $ 1,248 $ 15,652 $ 29,755
======== ======== ======== =========
Balance, January 1, 1999 $ 902 $ 1,276 $ 15,921 $ 32,360
Issuance of common stock, option exercise -- -- 2 --
Amortization of unearned compensation -- -- -- --
Net income -- -- -- 3,333
Foreign currency translation adjustments -- -- -- --
-------- -------- -------- ---------
Balance, April 2, 1999 $ 902 $ 1,276 $ 15,923 $ 35,693
======== ======== ======== =========
<CAPTION>
Total
Treasury Stock Unearned Accumulated Stockholders'
Shares Amount Compensation Translation Equity
<S> <C> <C> <C> <C> <C>
Balance, January 2, 1998 198,400 $ (1,054) $ (40) $ (417) $ 45,072
Amortization of unearned compensation -- -- 8 -- 8
Net income -- -- -- -- 974
Foreign currency translation adjustments -- -- -- (32) (32)
-------- -------- ------ -------- ----------
Balance, April 3, 1998 198,400 $ (1,054) $ (32) $ (449) $ 46,022
======== ========= ======= ======== =========
Balance, January 1, 1999 305,400 $ (1,665) $ (16) $ (528) $ 48,250
Issuance of common stock, option exercise -- -- -- -- 2
Amortization of unearned compensation -- -- 1 -- 1
Net income -- -- -- -- 3,333
Foreign currency translation adjustments -- -- -- (186) (186)
-------- -------- ------ -------- ----------
Balance, April 2, 1999 305,400 $ (1,665) $ (15) $ (714) $ 51,400
======== ========= ======= ======== =========
See notes to condensed consolidated financial statements
</TABLE>
<PAGE>
<TABLE>
SAUCONY, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THIRTEEN WEEKS ENDED APRIL 2, 1999 AND APRIL 3, 1998
<CAPTION>
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(in thousands)
(Unaudited)
April 2, April 3,
1999 1998
<S> <C> <C>
Cash flows from operating activities:
Net income $ 3,333 $ 974
-------- ---------
Adjustments to reconcile net income to net cash provided (used) by operating
activities:
Depreciation and amortization 462 413
Provision for bad debts and discounts 2,146 1,814
Deferred income tax benefit (617) (490)
Other 33 104
Changes in operating assets and liabilities, net effect of acquisitions,
dispositions and foreign currency adjustments:
Decrease (increase) in assets:
Marketable securities (8) (25)
Accounts receivable (16,268) (10,565)
Inventories 2,377 604
Prepaid expenses and other current assets 24 (351)
Increase (decrease) in liabilities:
Accounts payable (2,170) (345)
Accrued expenses 2,951 2,047
-------- ---------
Total adjustments (11,070) (6,794)
--------- ----------
Net cash used by operating activities (7,737) (5,820)
--------- ----------
Cash flows from investing activities:
Purchase of property, plant and equipment (330) (179)
Increase in deferred charges, deposits and other (10) (120)
Payments for business acquisitions 0 (624)
-------- ----------
Net cash used by investing activities (340) (923)
--------- ----------
Cash flows from financing activities:
Net short-term borrowings 4,210 4,572
Repayment of long-term debt and capital lease obligations (121) (100)
Issuances of common stock 2 0
-------- ---------
Net cash provided by financing activities 4,091 4,472
Effect of exchange rate changes on cash and
cash equivalents 89 (43)
-------- ----------
Net decrease in cash and cash equivalents (3,897) (2,314)
Cash and equivalents at beginning of period 5,495 4,432
-------- ---------
Cash and equivalents at end of period $ 1,598 $ 2,118
======== =========
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Income taxes, net of refunds $ 837 $ 106
======== =========
Interest $ 135 $ 129
======== =========
Non-cash investing and financing activities:
Property purchased under capital leases $ 114 $ 0
======== =========
See notes to condensed consolidated financial statements
</TABLE>
<PAGE>
SAUCONY, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
APRIL 2, 1999
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated 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. In the opinion of management, all
adjustments (consisting solely of normal recurring adjustments) necessary for a
fair presentation have been included. These interim consolidated financial
statements should be read in conjunction with the audited consolidated financial
statements and the notes, thereto, included in the Company's Annual Report on
Form 10-K, as filed with the Securities and Exchange Commission, for the year
ended January 1, 1999. Operating results for thirteen weeks ended April 2, 1999,
are not necessarily indicative of the results for the entire year.
NOTE 2 - RECLASSIFICATION
Certain items in prior years Consolidated Financial Statements have been
reclassified to conform to the 1999 presentation.
NOTE C - INVENTORIES
Inventories at April 2, 1999 and April 3, 1998 consisted of the following (in
thousands):
<TABLE>
<CAPTION>
April 2, January 1,
1999 1999
<S> <C> <C>
Finished goods $ 23,106 $ 24,194
Work in progress 1,025 834
Raw materials 4,188 6,044
----------- -----------
$ 28,319 $ 31,072
=========== ===========
</TABLE>
<TABLE>
NOTE 4 - EARNINGS PER SHARE
<CAPTION>
(Unaudited)
(in thousands, except per share amounts)
Thirteen Weeks Ended Thirteen Weeks Ended
April 2, 1999 April 3, 1998
--------------------------- --------------------------
Earnings Earnings Earnings Earnings
per per per per
Common Common Common Common
Share - Share - Share - Share -
Basic Diluted Basic Diluted
<S> <C> <C> <C> <C>
Consolidated income $ 3,333 $ 3,333 $ 974 $ 974
========== ========= ========== ==========
Net income available for common
shares and assumed conversions 6,229 6,229 6,251 6,251
Weighted average common shares and
equivalents outstanding 0 134 0 42
---------- --------- ---------- ----------
Effect of dilutive securities:
Employee stock options 6,229 6,363 6,251 6,293
========== ========= ========== ==========
Earnings per share $ 0.54 $ 0.52 $ 0.16 $ 0.16
========== ========= ========= ==========
</TABLE>
<TABLE>
NOTE 5 - STATEMENT OF COMPREHENSIVE INCOME
<CAPTION>
(in thousands)
Thirteen Weeks Thirteen Weeks
Ended Ended
April 2, 1999 April 3, 1998
<S> <C> <C>
Net income $ 3,333 $ 974
Other comprehensive income:
Foreign currency translation adjustment (186) (32)
Income tax benefit related to other
comprehensive expense (137) (12)
--------- ---------
Other comprehensive income, net of tax (49) (20)
--------- ---------
Comprehensive income $ 3,284 $ 954
======== ========
</TABLE>
<PAGE>
<TABLE>
NOTE 6 - OPERATING SEGMENT DATA
The Company's operating segments are organized based on the nature of products
and consist of the Saucony Segment and Other Products Segment. The determination
of the reportable segments for the thirteen weeks ended April 2, 1999 and April
3, 1998, as well as the basis of measurement of segment profit or loss, is
consistent with the segment reporting disclosed in the Company's Annual Report
on Form 10-K for the fiscal year ended January 1, 1999.
<CAPTION>
(in thousands)
Thirteen Weeks Thirteen Weeks
Ended Ended
April 2, 1999 April 3, 1998
<S> <C> <C>
Revenues:
Saucony $ 37,827 $ 25,884
Other products 4,787 3,782
----------- -----------
$ 42,614 $ 29,666
----------- -----------
Income (loss) before income taxes:
Saucony $ 6,065 $ 2,180
Other products (273) (285)
------------ ------------
$ 5,792 $ 1,895
----------- -----------
</TABLE>
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Highlights
Percent Increase
Net sales 43.1%
Gross Profit 54.6%
Selling, general and administrative 22.8%
$ Change
(in thousands)
Operating income $ 3,806
Income before tax 3,897
Net income 2,359
Percent of Net Sales
1999 1998
Gross profit 36.4% 33.7%
Selling, general and administrative 23.0 26.8
Operating income 13.9 7.0
Income before tax 13.7 6.4
Net income 7.9 3.3
The following table sets forth net sales (in thousands) and as a percentage of
total net sales of the Company's segments in the thirteen weeks ended April 2,
1999 and April 3, 1998:
<TABLE>
<CAPTION>
1999 1998
-------------------------- --------------------------
<S> <C> <C> <C> <C>
Saucony $ 37,675 88.8% $ 25,851 87.3%
Other 4,731 11.2% 3,773 12.7%
----------- --------- ----------- --------
Total $ 42,406 100.0% $ 29,624 100.0%
=========== ========= =========== ========
</TABLE>
Consolidated Net Sales
Net sales increased 43% to $42,406,000 in the thirteen weeks ended April 2, 1999
from $29,624,000 in the thirteen weeks ended April 3, 1998. The impact of
foreign exchange rate changes on net sales in the thirteen weeks ended April 2,
1999 was negligible.
Saucony Brand Segment
Worldwide net sales of branded Saucony footwear and apparel increased 46% to
$37,675,000 in the thirteen weeks ended April 2, 1999 from $25,851,000 in the
thirteen weeks ended April 3, 1998, primarily due to 83% unit volume growth in
the footwear category. Overall average sell price declined 29% in the thirteen
weeks ended April 2, 1999 due to a higher proportion of more moderately-priced
Jazz Originals in the Company's domestic product mix.
Domestic net sales increased 72% to $32,643,000 due primarily to increased unit
volumes for Jazz Originals (introduced in the second quarter of 1998), Saucony's
core technical footwear models and special make-up footwear. Jazz Original unit
volume accounted for 44% of domestic unit volume in the thirteen weeks ended
April 2, 1999.
International net sales decreased 27% to $5,032,000 due primarily to the
discontinuance of operations in Australia and, to a lesser extent, decreased
distributor unit volumes, both of which were offset in part by increased unit
volumes recorded by the Company in Canada and Western Europe.
Other Products Segment
Net sales of Other Products increased 25% to $4,731,000 in the thirteen weeks
ended April 2, 1999 from $3,773,000 in the thirteen weeks ended April 3, 1998,
reflecting significant revenue growth in both bicycle and related products as
well as increased sales of the Company's Hind apparel brand. The growth in
bicycles and related products revenue is due in large measure to the acquisition
of the Merlin business in February 1998 and the subsequent acquisition of Real
Design in August 1998.
Costs and Expenses
The Company's gross profit increased 55% to $15,421,000 in the thirteen weeks
ended April 2, 1999 from $9,973,000 in the thirteen weeks ended April 3, 1998
due to higher domestic unit volumes and, to a lesser extent, improved
international margins. The Company's gross margin improved to 36.4% in the
thirteen weeks ended April 2, 1999 from 33.7% in the thirteen weeks ended April
3, 1998 due to lower levels of product returns and markdowns and decreased
foreign sales of non-current models.
Selling, general and administrative expenses increased to $9,741,000, or 23.0%
of net sales, in the thirteen weeks ended April 2, 1999 from $7,933,000, or
26.8% of net sales, in the thirteen weeks ended April 3, 1998. Selling expenses
increased $1,010,000 in the thirteen weeks ended April 2, 1999 due to increased
sales commissions and payroll and related expenses. General and administrative
expenses increased $798,000 in the thirteen weeks ended April 2, 1999 due to
increased staffing, performance-based compensation and increased bad debt
expense.
Net interest expense decreased 30% to $146,000 in the thirteen weeks ended April
2, 1999, from $210,000 in the thirteen weeks ended April 3, 1998, due to lower
average debt levels resulting from the paydown of the Company's senior notes
payable in the second quarter of 1998 and, to a lesser extent, lower interest
rates.
Income Before Tax
1999 1998
---- ----
Segment
Saucony brand $ 6,065 $ 2,180
Other products (273) (285)
---------- ----------
Total $ 5,792 $ 1,895
========= =========
Consolidated income before tax increased to $5,792,000 in the thirteen weeks
ended April 2, 1999 from $1,895,000 in the thirteen weeks ended April 3, 1998
due primarily to increased domestic Saucony Brand income and the improved
financial performance of Hind apparel.
Income Taxes
The provision for income taxes increased to $2,430,000 in the thirteen weeks
ended April 2, 1999 from $898,000 in the thirteen weeks ended April 3, 1998 due
primarily to increased domestic pre-tax income. The effective tax rate decreased
to 41.9% in the thirteen weeks ended April 2, 1999 from 47.4% in the thirteen
weeks ended April 3, 1998 due primarily to a deferred tax valuation allowance
recorded in the thirteen weeks ended April 3, 1998, relating to foreign
operating losses that were not expected to be realized.
Net Income
Net income was $3,333,000 in the thirteen weeks ended April 2, 1999 compared to
net income of $974,000 in the thirteen weeks ended April 3, 1998. Diluted
earnings per share were $0.52 in the thirteen weeks ended April 2, 1999 compared
to $0.16 in the thirteen weeks ended April 3, 1998.
Liquidity and Capital Resources
As of April 2, 1999, the Company's cash and cash equivalents totaled $1,598,000,
a decrease of $3,897,000 from January 1, 1999. The decrease is due primarily to
an increase in accounts receivable of $14,122,000, net of the provision for bad
debt and discounts, offset by an increase in accrued liabilities of $2,951,000
and an increase in borrowings against the Company's domestic and foreign credit
facilities of $4,210,000. The increase in accounts receivable is due to
increased net sales of the Company's Saucony, Hind and bicycle products in the
thirteen weeks ended April 2, 1999. The Company's days sales outstanding for its
accounts receivable decreased to 72 days in the thirteen weeks ended April 2,
1999 from 85 days in the thirteen weeks ended April 3, 1998 due to a reduction
in credit terms and the reduction in receivables held by the Company's
Australian subsidiary. Inventories decreased $2,377,000 in the thirteen weeks
ended April 2, 1999 due to management of domestic inventory levels. As a
consequence of the improved inventory management and the demand for Jazz
Originals, the Company's inventory turns ratio increased to 3.6 turns in the
thirteen weeks ended April 2, 1999 from 3.4 turns in the thirteen weeks ended
April 3, 1998.
For the thirteen weeks ended April 2, 1999, the Company used $7,837,000 of net
cash from operating activities, expended $330,000 to acquire capital assets and
expended $121,000 to reduce long-term debt.
Principal factors (other than net income, accounts receivable, provision for bad
debts and discounts and inventory) affecting the operating cash flows in the
thirteen weeks ended April 2, 1999 included a decrease of $2,170,000 in accounts
payable (due to decreased inventory levels) and an increase of $2,951,000 in
accrued expenses (due primarily to increased income tax accruals resulting from
higher pre-tax earnings and, to a lesser extent, increased variable selling and
administrative expenses associated with a higher level of net sales).
The liquidity of the Company is contingent upon a number of factors, principally
the Company's future operating results. Management believes that the Company's
current cash and cash equivalents, credit facilities and internally generated
funds are adequate to meet its working capital requirements and to fund its
capital investment needs and debt service payments.
Year 2000
The Company views its exposure to the Year 2000 problem in three areas: (i)
internal computer systems used to manage the Company's business, (ii)
microprocessors and other electronic devices included as components of equipment
used by the Company ("embedded chips") and (iii) computer systems used by
suppliers and customers of the Company. The Company's plan, under the
coordination of the Vice President - Management Information Systems, is to
resolve its internal Year 2000 problems in these areas following sequential
phases of evaluation, updating and testing. In the evaluation phase, the Company
reviews the applicable system to identify Year 2000 problems and determines any
necessary remediation. The updating and testing phases involve the
implementation and testing, respectively, of Year 2000 remediation measures.
The Company has interviewed key suppliers to determine their capability to
continue providing goods and services. Based on responses from over 80% of those
surveyed, the Company believes that these suppliers are either Year 2000
compliant or will be made Year 2000 compliant on a timely basis. Nevertheless,
the Company continues to expand its understanding of the Year 2000 problems to
its significant business partners based on ongoing surveys and interviews and
this process will continue throughout 1999. Contingency plans for supply
disruptions are in the process of being formulated and are expected to be
completed by third quarter 1999.
The Company has also interviewed key customers and all those who utilize
Electronic Data Interface (EDI) as the principal means of placing orders. The
responses received indicate that most customers are in the process of developing
or executing remediation plans to address Year 2000 problems. The Company
believes that customers present a potential Year 2000 business risk because of
the Company's limited ability to influence their actions or internal processes.
The foregoing discussion of the Company's Year 2000 readiness contains
forward-looking statements and were derived using numerous assumptions. Despite
the Company's belief that its Year 2000 program reduces the risk of an internal
compliance failure and is taking an active approach to assess the readiness of
its business partners, there can be no assurances that all parties will achieve
timely Year 2000 compliance or that such noncompliance will not have a material
adverse impact to the Company.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
The Company has performed an analysis to assess the potential effect of
reasonably possible near-term changes in inflation and foreign currency exchange
rates. The effect of inflation on the Company's results of operations over the
past three years has been minimal. The impact of currency fluctuation on the
purchase of inventory by the Company from foreign suppliers has been minimal as
the transactions were denominated in U.S. dollars. The Company, however, is
subject to currency fluctuation risk with respect to the operating results of
the Company's foreign subsidiaries and certain foreign currency denominated
payables. The Company has entered into certain forward foreign exchange
contracts to minimize the transaction currency risk.
PART II. OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K
a. Exhibits
27.0 - Financial Data Schedule
99.1 - Certain Factors That May Affect Future Results,
incorporated herein by reference to pages 18-19 of the Company's
Annual Report on Form 10-K for the period ended January 1, 1999.
Such Form 10-K shall not be deemed to be filed herewith except to
the extent that portions thereof are expressly incorporated by
reference herein.
b. Reports on Form 8-K
None.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Saucony, Inc.
Date: May 17, 1999 By: /s/ Terence P. Chin
-----------------------
Terence P. Chin
Senior Vice President
Chief Financial Officer
(Duly authorized officer
and principal financial
officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial
information extracted from Saucony, Inc's.
Industries, Inc. Form 10-Q for the period
ended April 2, 1999 and is qualified in
its entirety by reference to such 10-Q.
</LEGEND>
<CIK> 0000049401
<NAME> Saucony, Inc.
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-Mos
<FISCAL-YEAR-END> Dec-31-1999
<PERIOD-START> Jan-02-1999
<PERIOD-END> Apr-02-1999
<CASH> 1598
<SECURITIES> 187
<RECEIVABLES> 33585
<ALLOWANCES> 1737
<INVENTORY> 28319
<CURRENT-ASSETS> 67229
<PP&E> 18529
<DEPRECIATION> 10367
<TOTAL-ASSETS> 77836
<CURRENT-LIABILITIES> 23691
<BONDS> 516
0
0
<COMMON> 2178
<OTHER-SE> 49222
<TOTAL-LIABILITY-AND-EQUITY> 77836
<SALES> 42406
<TOTAL-REVENUES> 42614
<CGS> 26985
<TOTAL-COSTS> 26985
<OTHER-EXPENSES> 9691
<LOSS-PROVISION> 525
<INTEREST-EXPENSE> 146
<INCOME-PRETAX> 5792
<INCOME-TAX> 2430
<INCOME-CONTINUING> 3333
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3333
<EPS-PRIMARY> 0.54
<EPS-DILUTED> 0.52
</TABLE>
