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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): JULY 14, 1994
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(JULY 14, 1994)
AMES DEPARTMENT STORES, INC.
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(Exact Name of Registrant As Specified In Its Charter)
DELAWARE
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(State Or Other Jurisdiction Of Incorporation)
1-5380 04-2269444
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(Commission File Number) (IRS Employer Identification No.)
2418 Main Street; Rocky Hill, Connecticut 06067-0801
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(Address Of Principal Executive Offices) (Zip Code)
(203) 257-2000
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(Registrant's Telephone Number, Including Area Code)
Not Applicable
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(Former Name Or Former Address, If Changed Since Last Report)
Exhibit Index on Page 4
Page 1 of 7 (Including Exhibit)
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ITEM 5: OTHER EVENTS
Beginning on July 14, 1994, Ames will distribute, to its banks and
other lenders, principal trade vendors and factors, summaries of its
unaudited financial results for the five and twenty-two weeks ended
July 2, 1994. These monthly and year-to-date results (collectively,
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 May 27,
1994 (referred to herein as the "Plan"), sales for the five weeks
ended July 2, 1994 were $5.8 million above Plan and EBITDA (as
defined in Exhibit 20) was $.8 million above Plan. In June, the
major portion of the favorable sales variance was in seasonal
merchandise and apparel. The favorable impact from the higher-than-
planned sales on June's gross margin was partially offset by a
lower-than-planned gross margin rate that was due, in part, to the
sales of certain lower-margin seasonal merchandise. Also, in June,
the Company received its share of the Wertheim settlement and
recorded a non-recurring gain of $12.0 million.
Sales for the twenty-two weeks ended July 2, 1994 were $7.5 million
below Plan; however, EBITDA was $.9 million better than Plan. The
unfavorable impact on the year-to-date EBITDA from the lower-than-
planned sales and gross margin rate was more than offset by lower-
than-planned expenses. The lower year-to-date gross margin rate was
due to higher-than-planned advertising markdowns. Store, field and
home office expenses were all below the year-to-date Plan.
As of July 2, 1994, LIFO inventories were $1.5 million above Plan.
Trade payables were $9.6 million above Plan due primarily to improved
payment terms. Outstanding borrowings under the Company's new
revolving line of credit as of July 2, 1994 were $10.8 million below
Plan due primarily to the better-than-planned trade payable terms.
Ames is distributing the monthly results to its banks and other
lenders, principal trade vendors and factors to facilitate their
credit analyses. 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 29, 1994, the
Company's Form 10-Q for the first fiscal quarter ended April 30,
1994, and the Company's Form 8-K dated May 27, 1994. 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.
Page 2 of 7
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During the pendency of its reorganization case, Ames disclosed
publicly its monthly results through filings with the Office of the
U.S. Bankruptcy Trustee and continued to report publicly its monthly
results during the fiscal year ended January 29, 1994. Although Ames
expects to continue to make its monthly results public for the fiscal
year ending January 28, 1995, 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 Twenty-two Weeks Ended July 2, 1994.
Page 3 of 7
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INDEX TO EXHIBITS
EXHIBIT NO. EXHIBIT PAGE NO.
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20 Unaudited Financial Summary Results for 6
the Five and Twenty-two Weeks Ended
July 2, 1994
Page 4 of 7
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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.
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Registrant
Dated: July 13, 1994 By: /S/ JOSEPH R. ETTORE
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Joseph R. Ettore
President and Chief
Executive Officer
Dated: July 13, 1994 By: /S/ WILLIAM C. NAJDECKI
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William C. Najdecki
Senior Vice President,
Chief Accounting Officer
Page 5 of 7
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AMES DEPARTMENT STORES, INC. Exhibit 20
JUNE RESULTS VS. PLAN Page 1 of 2
MANAGEMENT FORMAT
(Unaudited)
(In Millions)
<CAPTION>
June 1994 Fiscal 1995 Year-to-Date
Actual Plan* Last Yr** Actual Plan* Last Yr**
<S> <C> <C> <C> <C> <C> <C>
INCOME SUMMARY:
Net Sales $199.6 $193.8 $192.5 $783.6 $791.1 $786.0
FIFO Margin $ 53.4 53.1 52.3 210.8 217.6 215.4
Margin % 26.7% 27.4% 27.2% 26.9% 27.5% 27.4%
Total Expenses 50.0 50.9 52.9 219.6 226.1 223.3
Gain on Dispos. of Properties - - - 2.0 1.9 -
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EBIT 3.4 2.2 (0.6) (6.8) (6.6) (7.9)
Net Interest Expense 2.5 2.4 2.3 10.8 12.1 10.6
Non-Cash Inc. Tax Prov.(Ben.) 4.2 3.8 - (1.8) (2.2) -
Extra. Chg., net of tax ben. - - - 1.5 1.5 -
Non-Recurring (Gain)-Wertheim (12.0) (12.0) - (12.0) (12.0) -
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Net Income (Loss) $8.7 $8.0 ($2.9) ($5.3) ($6.0) ($18.5)
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From EBIT:
Non-Cash SARs Exp.(Credit) (0.4) - - 0.4 1.5 -
Depr/Amort, LIFO, & other,net 0.1 0.1 (0.3) 2.2 - (1.8)
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EBITDA $3.1 $2.3 ($0.9) ($4.2) ($5.1) ($9.7)
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BALANCE SHEET SUMMARY: Balance at
end of Period
Actual Plan
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Unrestricted Cash and Cash Equivalents $32.9 $34.1
Restricted Cash and Cash Equivalents 1.0 1.0
Merchandise Inventories, LIFO 474.6 473.1
Other Current Assets 35.6 30.1
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Total Current Assets 544.1 538.3
Net Fixed Assets 25.9 39.5
Other Assets and Deferred Charges 7.6 6.7
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Total Assets $577.6 $584.5
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Trade Accounts Payable $72.4 $62.8
Short-Term Debt (Revolver) 114.2 125.0
Other Current Liabilities 168.6 179.1
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Total Current Liabilities 355.2 366.9
Long-Term Debt 42.2 42.3
Fresh-start Excess Net Assets (Negative Goodwill) 52.2 52.2
Unfavorable Lease Liability 24.1 24.2
Other Long-Term Liabilities 51.4 50.0
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Total Liabilities & Fresh-St. Excess Net Assets 525.1 535.6
Paid-In-Capital 70.9 67.2
Retained Earnings (Deficit) (18.4) (18.3)
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Total Liabilities & Equity $577.6 $584.5
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<FN>
* As reported on Form 8-K dated May 27, 1994.
** Last year's (fiscal 1994) income summary represents 309 stores as
compared to 305 stores in June 1994.
NOTE: EBIT is earnings (loss) before net interest expense, income taxes, and
non-recurring or extraordinary items. EBITDA is EBIT before depre-
ciation & amortization, LIFO expense, stock appreciation rights (SARs)
accruals, and other non-cash charges.
Page 6 of 7
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AMES DEPARTMENT STORES, INC. Exhibit 20
JUNE RESULTS VS. PLAN Page 2 of 2
MANAGEMENT FORMAT
(Unaudited)
(In Millions)
<CAPTION>
Fiscal 1995
June 1994 Year-to-Date
Actual Plan* Actual Plan*
<S> <C> <C> <C> <C>
CASH FLOW SUMMARY:
Beg. Unrestricted Cash & Cash Equiv. $32.2 $33.0 $16.5 $26.9
Cash Generated from (Used in) Operations:
Net Income (Loss) 8.7 8.0 (5.3) (6.0)
Non-Cash Income Tax Expense (Benefit) 4.2 3.8 (1.8) (2.2)
Other (0.4) 0.4 0.9 2.9
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Cash from Operations 12.5 12.2 (6.2) (5.3)
Changes in Working Capital:
FIFO Inventory (increase) decrease 30.8 27.0 (32.8) (32.9)
Trade Payables increase (decrease) (29.3) (14.6) (1.7) (12.1)
All Other 6.4 (0.1) (2.0) (1.1)
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Net Changes in Working Capital 7.9 12.3 (36.5) (46.1)
Capital Expenditures (3.2) (6.0) (6.1) (15.7)
(Incr) Decr. in Rest. Cash & Cash Equiv. 54.3 68.3 55.0 57.2
Other:
Short-Term Borrow. (Pymts) - Revolver 6.0 (10.0) 98.8 105.0
Payments of Capital Leases (0.3) (0.3) (1.5) (1.5)
Payments on Long-Term Debt (69.9) (69.6) (79.5) (79.0)
Increase in Deferred Financing Costs (6.6) (5.8) (7.6) (7.4)
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Total Other (70.8) (85.7) 10.2 17.1
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Unrestricted Cash Increase (Decrease) 0.7 1.1 16.4 7.2
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Ending Unrestricted Cash & Cash Equiv. $32.9 $34.1 $32.9 $34.1
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<FN>
* As reported on Form 8-K dated May 27, 1994.
Page 7 of 7
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