<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): JANUARY 17, 1994
------------------
(JANUARY 17, 1994)
AMES DEPARTMENT STORES, INC.
(Exact Name of Registrant As Specified In Its Charter)
DELAWARE
(State Or Other Jurisdiction Of Incorporation)
1-5380 04-269444
(Commission File Number) (IRS Employer Identification No.)
2418 MAIN STREET; ROCKY HILL, CONNECTICUT 06067-0801
(Address Of Principal Executive Offices) (Zip Code)
(203) 257-2000
Registrant's Telephone Number, Including Area Code)
NOT APPLICABLE
(Former Name Or Former Address, If Changed Since Last Report)
Exhibit Index on Page 4
Page 1 of 7 (Including Exhibit)
<PAGE>
<PAGE>
ITEM 5: OTHER EVENTS
Beginning on January 17, 1994, Ames Department Stores, Inc. ("Ames"
or the "Company") will distribute, to certain of its banks, principal
trade vendors and factors, summaries of its unaudited financial
results for the five and forty-eight weeks ended January 1, 1994.
These monthly and year-to-date results (the "monthly results") are
attached hereto as Exhibit 20 and are incorporated by reference
herein.
Compared with the projections contained in the Form 8-K dated April
5, 1993 (referred to herein as the "Plan"), sales for the five weeks
ended January 1, 1994 were $45.8 million below Plan and EBITDA was
$1.3 million below Plan. EBITDA is defined as earnings (loss) before
interest, income taxes, LIFO expense or credit, restructuring
charges, bankruptcy expenses, depreciation and amortization, and any
non-cash extraordinary or unusual items. In December, the sales
shortfall was divided approximately equally between softline and
hardline categories. The unfavorable impact from the lower-than-
planned sales on December's EBITDA was substantially offset by a
higher-than-planned gross margin rate and lower-than-planned
expenses. The gross margin rate was above Plan in December due
primarily to the Company's emphasis on higher-margin products in its
merchandise mix and in its advertising, and lower-than-planned
clearance markdowns and inventory shrink results. In addition, in
December, advertising and store operating expenses (other than store
payroll) were below Plan.
Sales for the forty-eight weeks ended January 1, 1994 were $139.5
million below Plan; however, EBITDA was approximately equal to Plan.
The year-to-date sales shortfall against Plan was due, in part, to
the Company's de-emphasis of lower-margin hardline categories and to
shortfalls in apparel and ladies accessories sales. The unfavorable
impact from the sales shortfall on the year-to-date EBITDA was offset
primarily by a higher-than- planned gross margin rate and
lower-than-planned expenses.
As of January 1, 1994, inventories were $11.9 million below Plan,
principally in apparel categories. As planned, there were no
outstanding borrowings under the Company's revolving line of credit
as of January 1, 1994. The Company's cash balance at January 1, 1994
was $3.0 million above Plan.
As of December 21, 1993, Ames had repaid all borrowings required to
be repaid under the "clean-up" provision of its credit agreement.
The Company expects to meet its consecutive 30-day "clean-up"
requirement. Ames is in compliance with all debt covenants through
fiscal December.
Ames is distributing the monthly results to its banks, principal
trade vendors and factors to facilitate their credit analysis
following the Company's emergence from bankruptcy. The summary
results SHOULD NOT BE RELIED UPON FOR ANY OTHER PURPOSE and should
be read in conjunction with the Company's Form 10-K for the fiscal
year ended January 30, 1993, the Company's Form 10-Q for the first,
second, and third fiscal quarters ended May 1, 1993, July 31, 1993,
Page 2 of 7
<PAGE>
<PAGE>
and October 30, 1993, respectively, and the Company's Form 8-K dated
April 5, 1993. The monthly results are being reported publicly
solely because they are being distributed to a large number of the
Company's vendors for purposes of their credit analyses.
In accordance with the guidelines provided by the American Institute
of Certified Public Accountants in Statement of Position 90-7
"Financial Reporting by Entities in Reorganization Under the
Bankruptcy Code," the Company adopted fresh-start reporting at
December 26, 1992, the effective date of the Chapter 11 plan of
reorganization for accounting purposes. Under fresh-start reporting,
the reorganization value of the Company upon its emergence from
Chapter 11 was allocated to its net assets on the basis of the
purchase method of accounting at December 26, 1992. Accordingly,
monthly results during the fiscal year ending January 29, 1994,
except for the December balance sheet, will not be comparable in
material respects to such results for the eleven months ended
December 26, 1992. The presentation of EBITDA results in a more
meaningful comparison with last year due to the impact of fresh-start
reporting on depreciation, amortization and LIFO inventory.
During the pendency of its reorganization case, Ames disclosed
publicly its monthly results through filings with the Office of the
U.S. Bankruptcy Trustee. Although Ames expects to make monthly
results public for a period of time following its emergence from
bankruptcy, Ames does not believe it is obligated to provide such
information indefinitely, other than as required by applicable
regulations, and Ames may cease making such disclosures and updates
at any time. The monthly results were not examined, reviewed or
compiled by Ames' independent certified accountants. Moreover, Ames
does not believe that it is obligated to update the monthly results
to reflect subsequent events or developments. The reported monthly
results are subject to future adjustments, if any, that could
materially affect such results. However, in the opinion of the
Company, the monthly results contain all adjustments (consisting of
normal recurring adjustments) necessary for a fair statement of the
results for the periods presented.
ITEM 7: FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
Exhibit: 20 Unaudited Financial Summary Results for the
Five and Forty-Eight Weeks Ended January 1, 1994
Page 3 of 7
<PAGE>
<PAGE>
INDEX TO EXHIBITS
Exhibit No. Exhibit Page No.
20 Unaudited Financial Summary Results for the 6
Five and Forty-Eight Weeks Ended January 1, 1994
Page 4 of 7
<PAGE>
<PAGE>
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.
AMES DEPARTMENT STORES, INC.
Registrant
Dated: January 14, 1994 By: /s/ Peter Thorner
---------------------------
Peter Thorner
President, Chief Operating
Officer and Director
Dated: January 14, 1994 By: /s/ William C. Najdecki
----------------------------
William C. Najdecki
Senior Vice President,
Chief Accounting Officer
Page 5 of 7
<PAGE>
<TABLE>
AMES DEPARTMENT STORES, INC. Exhibit 20
DECEMBER RESULTS VS. PLAN Page 1 of 2
MANAGEMENT FORMAT
(Unaudited)
(In Millions)
<CAPTION>
December 1993 Fiscal 1994 Year-to-Date
Actual Plan* Last Yr** Actual Plan* Last Yr**
<S> <C> <C> <C> <C> <C> <C>
INCOME SUMMARY:
Net Sales $348.2 $394.0 $390.8 $2,026.5 $2,166.0 $2,063.9
FIFO Margin $ 101.4 106.6 104.1 551.7 567.5 530.2
Margin % 29.1% 27.1% 26.6% 27.2% 26.2% 25.7%
Total Expenses 51.6 56.2 57.2 496.7 513.9 541
Gain on Sale of Properties 0.5 - - 1.4 - -
--------------------------------------------------
EBIT 50.3 50.4 46.9 56.4 53.6 (10.8)
Interest (Expense) Income, net (2.0) (2.2) (0.4) (24.7) (27.5) 1.3
Chapter 11 Expenses - - (7.0) - - (25.5)
Restructuring Charges - - (16.0) - - (88.5)
Fresh-Start Revaluation Charge - - (391.2) - - (391.2)
Non-Cash Extraordinary Gain - - 1,249.3 0.9 - 1,249.3
Income Tax Expense - (0.3) - - (0.3) -
--------------------------------------------------
Net Profit $48.3 $47.9 $881.6 $32.6 $25.8 $734.6
==================================================
Depr. & Amort. and LIFO, net 1.4 0.2 5.3 4.9 2.1 (37.6)
--------------------------------------------------
EBITDA $48.9 $50.2 $41.6 $51.5 $51.5 $26.8
==================================================
BALANCE SHEET SUMMARY: Balance at
end of Period
Actual Plan
------------------
Cash and Cash Equivalents $111.0 $108.0
Merchandise Inventories, LIFO 424.6 436.5
Other Current Assets 34.3 35.6
------------------
Total Current Assets 569.9 580.1
Net Fixed Assets 20.6 28.8
------------------
Total Assets $590.5 $608.9
==================
Trade Accounts Payable $70.6 $74.4
Short-Term Debt - -
Other Current Liabilities 189.3 207.0
------------------
Total Current Liabilities 259.9 281.4
Long-Term Debt 118.5 124.1
Other Long-Term Liabs. & Excess Reval. Net Assets 133.3 131.2
------------------
Total Liabilities 511.7 536.7
Paid-In-Capital 70.1 70.3
Retained Earnings (Deficit) 8.7 1.9
------------------
Total Liabilities & Equity $590.5 $608.9
==================
<FN>
* As reported on Form 8-K dated April 5, 1993.
** Last year's (fiscal 1993) income summary is revised for 309 stores.
Also, gross margin excludes depreciation for comparability. Last
year's fiscal December period, ended December 26, 1992, included
Thanksgiving week and only one post-Christmas shopping day.
NOTE: EBIT is earnings (loss) before interest, Ch. 11 expenses, restruc. chgs.,
income taxes, and any non-cash extraordinary items. EBITDA is EBIT before
depreciation & amortization, LIFO expense or credit, and any non-cash
unusual charges and gains.
Page 6 of 7
</TABLE>
<PAGE>
<TABLE>
AMES DEPARTMENT STORES, INC. Exhibit 20
DECEMBER RESULTS VS. PLAN Page 2 of 2
MANAGEMENT FORMAT
(Unaudited)
(In Millions)
<CAPTION>
Fiscal 1994
December 1993 Year-to-Date
Actual Plan* Actual Plan*
<S> <C> <C> <C> <C>
CASH FLOW SUMMARY:
Beginning Cash & Cash Equivalents $107.1 $130.1 $115.5 $115.5
Cash Generated from (Used in) Operations:
Net Profit 48.3 47.9 32.6 25.8
Other (1.5) 0.6 (1.9) 3.3
------------------------------------
Cash from Operations 46.8 48.5 30.7 29.1
Changes in Working Capital:
FIFO Inventory (increase) decrease 137.2 159.9 39.1 25.3
Trade Payables increase (decrease) (83.2) (95.7) 7.3 11.1
All Other 38.4 7.1 (21.4) (4.6)
------------------------------------
Net Changes in Working Capital 92.4 71.3 25.0 31.8
Capital Spending (1.8) (1.2) (18.9) (27.8)
Other:
Short-Term Borrowings (Payments) (128.3) (135.0) (23.0) (23.0)
Payment of Capital Leases (0.1) (0.3) (3.2) (3.2)
Payments on Long-Term Debt (4.7) (3.3) (24.9) (22.1)
Restructuring & Other (0.4) (2.1) 9.8 7.7
------------------------------------
Total Other (133.5) (140.7) (41.3) (40.6)
------------------------------------
Cash Increase (Decrease) 3.9 (22.1) (4.5) (7.5)
------------------------------------
Ending Cash & Cash Equivalents $111.0 $108.0 $111.0 $108.0
====================================
<FN>
* As reported on Form 8-K dated April 5, 1993.
Page 7 of 7
</TABLE>
