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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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 March 31, 1995, or
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission File Number: 0-3839
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BOOK CENTERS, INC.
(Exact name of registrant as specified in its charter)
OREGON
(State or other jurisdiction of incorporation or organization)
5600 N.E. HASSALO STREET
PORTLAND, OREGON
(Address of principal executive offices)
93-0508266
(IRS Employer Identification Number)
97213
(Zip code)
(503) 287-6657
(Registrant's telephone number, including area code)
NOT APPLICABLE
(Former name, former 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
The number of shares outstanding of each of the issuer's classes of common
stock was 636,889 shares of common stock, no par value, outstanding as of
April 30, 1995.
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BOOK CENTERS, INC.
FORM 10-Q
INDEX
PART I: Financial Information Page
--------------------- ----
Item 1: Financial Statements Book Centers, Inc.
---------------------------------------
Consolidated Balance Sheet<F1>
at March 31, 1995 and June 30, 1994 . . . . . . . . .. . . . . . . . 4
Consolidated Statement of Operations<F1>
for the three month periods ended March 31, 1995 and 1994. . . . . . 6
Consolidated Statement of Cash Flows<F1>
for the nine month periods ended March 31, 1995 and 1994 . . . . . . 7
Consolidated Statement of Operations<F1>
for the nine month periods ended March 31, 1995 and 1994 . . . . . . 9
Note to Consolidated Financial Statements. . . . . . . . . . . . . .10
Item 2: Management's Discussion and Analysis of Financial Condition and
Results of Operations . . . . . . . . . . . . . . . . . . . . . . . .11
<F1>
In the opinion of Management, such financial statements contain all adjustments
necessary to prevent fairly the financial position as of March 31, 1995 and
June 30, 1994 and the results of the operations and cash flows for the three
and nine month period ended March 31, 1995.
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BOOK CENTERS, INC.
FORM 10-Q
INDEX
PART II: Other Information Page
----------------- ----
Item 1: Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . .12
Item 2: Changes in Securities . . . . . . . . . . . . . . . . . . . . . . . .13
Item 3: Defaults Upon Senior Securities . . . . . . . . . . . . . . . . . . .14
Item 4: Submission of Matters to a Vote of Security Holders . . . . . . . . .15
Item 5: Other Information . . . . . . . . . . . . . . . . . . . . . . . . . .16
Item 6: Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . . . . . .17
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18
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PART I: Item 1: Financial Information
BOOK CENTERS, INC.
AND SUBSIDIARIES
Consolidated Balance Sheet
(Unaudited)
<TABLE>
<CAPTION>
3/31/95 6/30/94
---------- ----------
<S> <C> <C>
ASSETS
Current assets:
Accounts receivable, net of allowance
for doubtful accounts of
$11,523 and $12,155 $3,627,777 $3,151,717
Book inventories 1,510,248 1,233,136
Prepaid expenses 326,262 282,445
--------- ---------
Total current assets 5,464,287 4,667,298
Office furnishings and equipment, at cost
less accumulated depreciation of
$633,353 and $583,515 171,789 186,570
Other assets 3,750 ----
--------- ---------
$5,639,826 $4,853,868
========= =========
See note to consolidated financial statements.
</TABLE>
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BOOK CENTERS, INC.
AND SUBSIDIARIES
Consolidated Balance Sheet
(Unaudited)
(Continued)
<TABLE>
<CAPTION>
3/31/95 6/30/94
---------- ----------
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Bank overdraft $1,464,401 $ 738,721
Notes payable 377,398 752,567
Current portion of long-term debt 19,837 25,729
Accounts payable 2,868,719 3,089,979
Deferred revenue 1,303,219 725,201
Accrued expenses 276,687 329,135
--------- ---------
Total current liabilities 6,310,261 5,661,332
Long-term debt, less current portion 46,753 60,698
--------- ---------
Total liabilities 6,357,014 5,722,030
Stockholders' equity:
Common stock, no-par value
5,000,000 shares authorized
636,889 issued 688,837 688,837
Paid in capital 428,988 428,988
Accumulated deficit (1,835,013) (1,985,987)
--------- ---------
Total stockholders' deficit ( 717,188) ( 868,162)
--------- ---------
$5,639,826 $4,853,868
========= =========
See note to consolidated financial statements.
</TABLE>
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BOOK CENTERS, INC.
AND SUBSIDIARIES
Consolidated Statement of Operations
(Unaudited)
<TABLE>
<CAPTION>
For the
Three Month Periods
Ended March 31,
---------------------------
1995 1994
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<S> <C> <C>
Net sales $5,974,607 $5,123,178
Expenses:
Cost of goods sold 5,026,654 4,290,219
Operating and administrative 845,282 760,259
Interest 50,333 48,311
--------- ---------
Total expenses 5,922,269 5,098,789
Income (loss) before taxes
Income taxes 52,338 24,389
---- ----
Net income (loss) 52,338 24,389
========= =========
Earnings (loss) per share:
Income (loss) $ .08 $ .04
--------- ---------
Net income (loss) per share $ .08 $ .04
========= =========
See note to consolidated financial statements.
</TABLE>
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BOOK CENTERS, INC.
AND SUBSIDIARIES
Consolidated Statement of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
For the
Nine Month Periods
Ended March 31,
---------------------------
1995 1994
---------- ----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Operations:
Net income (loss) $ 150,987 $ 40,002
Loss on disposal of equipment ---- 15,353
Adjustments to reconcile net income
(loss) before extraordinary item to
net cash used in operating activities:
Depreciation and amortization 49,838 48,587
--------- ---------
Cash flows from operating activities
before changes in account balances 200,825 103,942
Changes in account balances:
Accounts receivable ( 476,060) 379,991
Book inventories ( 277,112) ( 367,103)
Prepaid expenses and other ( 47,567) 5,930
Accounts payable ( 221,260) ( 462,869)
Deferred revenue 578,018 407,538
Accrued expenses ( 52,448) ( 10,239)
Accrual for restructuring charges ---- ( 17,019)
--------- ---------
Net cash provided by (used in)
operating activities ( 295,604) 40,171
--------- ---------
See note to consolidated financial statements.
</TABLE>
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BOOK CENTERS, INC.
AND SUBSIDIARIES
Consolidated Statement of Cash Flows
(Unaudited)
(Continued)
<TABLE>
<CAPTION>
For the
Nine Month Periods
Ended March 31,
--------------------------
1995 1994
---------- ----------
<S> <C> <C>
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to office furnishings
and equipment ( 35,057) ( 49,583)
Other ( 13) ----
--------- ---------
Net cash used in investing activities ( 35,070) ( 49,583)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase (decrease) in notes payable
to commercial factors ( 375,169) ( 273,161)
Net (payments) borrowings on long term debt ( 19,837) 18,628
--------- ---------
Net cash provided by (used in)
financing activities ( 395,006) ( 254,533)
--------- ---------
Net increase (decrease) in cash ( 725,680) ( 263,945)
Bank overdraft, beginning of period ( 738,721) (1,022,773)
Bank overdraft, end of period $1,464,401 $(1,286,718)
========= ==========
See note to consolidated financial statements.
</TABLE>
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BOOK CENTERS, INC.
AND SUBSIDIARIES
Consolidated Statement of Operations
(Unaudited)
<TABLE>
<CAPTION>
For the
Nine Month Periods
Ended March 31,
----------------------------
1995 1994
----------- -----------
<S> <C> <C>
Net sales $17,247,205 $15,735,861
Expenses:
Cost of goods sold 14,433,214 13,085,495
Operating and administrative 2,530,393 2,482,156
Interest 132,611 128,208
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Total expenses 17,096,218 15,695,859
Income (loss) before taxes and
extraordinary item 150,987 40,002
Income taxes ---- ----
---------- ----------
Income (loss) before extraordinary item 150,987 40,002
Extraordinary item:
Tax benefits from utilization of net
operating loss carryforwards ---- ----
---------- ----------
Net income (loss) $ 150,987 $ 40,002
========== ==========
Earnings (loss) per share .24 .06
---------- ----------
Net income (loss) per share $ .24 $ .06
========== ==========
See note to consolidated financial statements.
</TABLE>
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BOOK CENTERS, INC.
AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(Unaudited)
NOTE A: Earnings (loss) per Common Share
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Earnings (loss) per common share is based on the average number of common
shares outstanding (exclusive of shares held in treasury). The number of
shares outstanding at March 31, 1995, was 636,889.
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PART I: Item 2: Financial Information
BOOK CENTERS, INC.
AND SUBSIDIARIES
Management's Discussion and Analysis
of Financial Condition
and Results of Operations
------------------------------------
Earnings increased in the third quarter over the same period in the previous
year by $27,949 (114.6%). This is attributable to a 16.62% increase in sales
($851,429). Operating and administrative costs increased by 11.18% primarily
because of increased air freight costs for shipping books to customers in
Asia, Europe, and Africa. In addition, margins continued to decrease (-2.39%)
because of reduced discounts from publishers.
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PART II: Item 1: Other Information
BOOK CENTERS, INC.
AND SUBSIDIARIES
Legal Proceedings
-----------------
There are no additional matters to be reported beyond those contained in the
Registrant's Annual Report on Form 10-K for the year ended June 30, 1994.
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PART II: Item 2: Other Information
BOOK CENTERS, INC.
AND SUBSIDIARIES
Changes in Securities
---------------------
a. Modification of Instruments
- None applicable
b. Modification of Any Other Class of Securities
- None applicable
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PART II: Item 3: Other Information
BOOK CENTERS, INC.
AND SUBSIDIARIES
Defaults Upon Senior Securities
-------------------------------
a. Default in Installment Payments
- None applicable
b. Default in Dividend Payments
- None applicable
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PART II: Item 4: Other Information
BOOK CENTERS, INC.
AND SUBSIDIARIES
Submission of Matters to a Vote of Security Holders
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None
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PART II: Item 5: Other Information
BOOK CENTERS, INC.
AND SUBSIDIARIES
Other Information
-----------------
None
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PART II: Item 6: Exhibits and Reports on Form 8-K
BOOK CENTERS, INC.
AND SUBSIDIARIES
Exhibits and Reports on Form 8-K
--------------------------------
a. Exhibits
None
b. Reports on Form 8-K
None
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PART II: Signatures
BOOK CENTERS, INC.
AND SUBSIDIARIES
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.
BOOK CENTERS, INC.
Date: May 12, 1995 DANIEL P. HALLORAN
------------------
DANIEL P. HALLORAN, PRESIDENT,
CHAIRMAN OF THE BOARD OF
DIRECTORS, CHIEF FINANCIAL
OFFICER, CONTROLLER, AND SECRETARY/
TREASURER (PRINCIPAL ACCOUNTING
OFFICER)
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<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM BOOK
CENTERS, INC.'S MARCH 31, 1995 10-Q AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS
</LEGEND>
<CIK> 0000050326
<NAME> BOOK CENTERS, INC.
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1995
<PERIOD-END> MAR-31-1995
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 3,627,777
<ALLOWANCES> 11,523
<INVENTORY> 1,510,248
<CURRENT-ASSETS> 5,464,287
<PP&E> 171,789
<DEPRECIATION> 633,353
<TOTAL-ASSETS> 5,639,826
<CURRENT-LIABILITIES> 6,310,261
<BONDS> 0
<COMMON> 688,837
0
0
<OTHER-SE> (1,406,025)
<TOTAL-LIABILITY-AND-EQUITY> 5,639,826
<SALES> 17,247,205
<TOTAL-REVENUES> 17,247,205
<CGS> 14,433,214
<TOTAL-COSTS> 14,433,214
<OTHER-EXPENSES> 2,530,393
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 132,611
<INCOME-PRETAX> 150,987
<INCOME-TAX> 0
<INCOME-CONTINUING> 150,987
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 150,987
<EPS-PRIMARY> .24
<EPS-DILUTED> .24
</TABLE>
