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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): January 12, 1995
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(January 12, 1995)
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 January 12, 1995, Ames Department Stores, Inc. ("the
Company") will distribute to its banks and other lenders,
principal trade vendors and factors, summaries of its unaudited
financial results for the five and forty-eight weeks ended
December 31, 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 December 31, 1994 were $2.5 million greater than Plan
and EBITDA (as defined in Exhibit 20) was $1.6 million greater
than Plan and $1.1 million greater than last year. In December,
the favorable sales variance was primarily due to a strong
performance in mens and childrens apparel. December's gross
margin rate was less than Plan due primarily to higher-than-
planned markdowns. Store non-payroll, advertising, field and home
office expenses were less than Plan in December. Also in
December, the Company recognized a gain of $1.8 million on the
sale of its lease interest at the Camp Hill, PA store which is to
be closed.
Sales for the forty-eight weeks ended December 31, 1994 were $33.5
million less than Plan and EBITDA was $9.4 million less than Plan
but $7.3 million greater than last year. The year-to-date
unfavorable sales variance was due primarily to shortfalls in
ladies apparel, crafts, and convenience goods. The lower
year-to-date gross margin rate was due primarily to higher-than-
planned markdowns, particularly in apparel. The unfavorable
impact on the year-to-date EBITDA from the lower-than-planned
sales and gross margin rate was partially offset by
lower-than-planned expenses and higher property gains.
Year-to-date store, field and home office expenses were all less
than Plan.
As of December 31, 1994, LIFO inventories were $33.5 million
greater than Plan, primarily in hardline categories. The variance
was due primarily to special purchases, as well as sales
shortfalls in certain merchandise categories. Trade payables were
$61.2 million greater than Plan due primarily to improved payment
terms. As of December 23, 1994, the Company had repaid all
borrowings under its revolving line of credit and, as of January
11, 1995, had completed 19 days of its 30-day "clean-up"
requirement.
The Company 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, second and third
quarters ended April 30, July 30, and October 29, 1994,
respectively, 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, the Company
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 the Company expects to continue to make its
monthly results public for the fiscal year ending January 28,
1995, the Company does not believe it is obligated to provide such
information indefinitely, other than as required by applicable
regulations, and the Company may cease making such disclosures and
updates at any time. The monthly results were not examined,
reviewed or compiled by the Company's independent certified public
accountants. Moreover, the Company 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 Four
and Forty-eight Weeks Ended December 31, 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 6
for the Four and Forty-eight Weeks
Ended December 31, 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: January 11, 1994 By: /s/ Joseph R. Ettore
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Joseph R. Ettore
President, Director, and
Chief Executive Officer
Dated: January 11, 1994 By: /s/ John F. Burtelow
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John F. Burtelow
Executive Vice President,
Chief Financial Officer
Dated: January 11, 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
DECEMBER RESULTS VS. PLAN Page 1 of 2
MANAGEMENT FORMAT
(Unaudited)
(In Millions)
<CAPTION>
December 1994 Fiscal 1/95 Year-to-Date
Actual Plan* Last Yr** Actual Plan* Last Yr**
<S> <C> <C> <C> <C> <C> <C>
INCOME SUMMARY:
Net Sales $362.9 $360.4 $348.2 $2,026.7 $2,060.2 $2,026.5
FIFO Margin $ 99.5 104.3 101.4 537.9 570.8 551.7
Margin % 27.4% 28.9% 29.1% 26.5% 27.7% 27.2%
Total Expenses 50.6 56.1 51.6 486.5 507.1 496.7
Gain on Dispos. of Properties 1.8 - 0.5 5.4 1.9 1.4
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EBIT 50.7 48.2 50.3 56.8 65.6 56.4
Net Interest Expense 2.0 2.0 2.0 24.2 25.6 24.7
Non-Cash Inc. Tax Prov.(Ben.) 14.1 15.0 - 12.4 16.9 -
Extraordinary Loss (Gain) - - - 1.5 1.5 (0.9)
Non-Recurring (Gain)-Wertheim - - - (12.0) (12.0) -
Dist. Center Closing Costs - - - 2.5 - -
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Net Income $34.6 $31.2 $48.3 $28.2 $33.6 $32.6
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From EBIT:
Non-Cash SARs Exp.(Credit) - - - - 1.5 -
Depr/Amort, LIFO, & other,net (0.7) 0.2 (1.4) 2.0 1.1 (4.9)
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EBITDA $50.0 $48.4 $48.9 $58.8 $68.2 $51.5
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BALANCE SHEET SUMMARY:
Balance at end of Period
Actual Plan* Last Yr**
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Unrestricted Cash and Cash Equivalents $59.1 $37.8 $61.3
Restricted Cash and Cash Equivalents 2.2 0.2 49.7
Merchandise Inventories, LIFO 430.1 396.6 424.6
Other Current Assets 34.7 35.6 34.3
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Total Current Assets 526.1 470.2 569.9
Net Fixed Assets 40.9 51.7 20.6
Other Assets and Deferred Charges 6.4 4.9 -
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Total Assets $573.4 $526.8 $590.5
===========================
Trade Accounts Payable $134.0 $72.8 $70.6
Short-Term Debt (Revolver) - - -
Other Current Liabilities 179.1 185.3 189.3
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Total Current Liabilities 313.1 258.1 259.9
Long-Term Debt 38.9 40.6 118.5
Other Long-Term Liabilities 49.0 48.1 52.7
Unfavorable Lease Liability 23.1 23.1 25.3
Fresh-start Excess Net Assets (Negative Goodwill) 49.1 49.2 55.3
Paid-In-Capital 85.1 86.3 70.1
Retained Earnings (Deficit) 15.1 21.4 8.7
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Total Stockholders' Equity 100.2 107.7 78.8
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Total Liabilities & Equity $573.4 $526.8 $590.5
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<FN>
* As reported on Form 8-K dated May 27, 1994.
** Last year's (fiscal 1/94) income and balance sheet summaries
represent 308 stores as compared to 306 stores in December 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
DECEMBER RESULTS VS. PLAN Page 2 of 2
MANAGEMENT FORMAT
(Unaudited)
(In Millions)
<CAPTION>
Fiscal 1/95
December 1994 Year-to-Date
Actual Plan* Actual Plan*
<S> <C> <C> <C> <C>
CASH FLOW SUMMARY:
Beg. Unrestricted Cash & Cash Equiv. $53.7 $50.5 $16.5 $26.9
Cash Generated from (Used in) Operations:
Net Income 34.6 31.2 28.2 33.6
Non-Cash Income Tax Expense 14.1 15.0 12.4 16.9
Other (0.4) 0.6 6.6 6.2
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Cash from Operations 48.3 46.8 47.2 56.7
Changes in Working Capital:
FIFO Inventory (increase) decrease 140.6 161.4 12.0 43.0
Trade Payables increase (decrease) (59.6) (105.2) 59.9 (2.1)
All Other 45.7 40.8 4.7 (0.9)
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Net Changes in Working Capital 126.7 97.0 76.6 40.0
Capital Expenditures (1.3) (0.7) (23.8) (31.6)
(Incr) Decr. in Rest. Cash & Cash Equiv. (1.5) 0.2 53.8 58.1
Other:
Short-Term Borrow. (Pymts) - Revolver (164.2) (155.0) (15.4) (20.0)
Payments of Capital Leases (0.3) (0.3) (3.6) (3.5)
Payments on Long-Term Debt (2.0) (0.7) (84.1) (81.4)
Increase in Deferred Financing Costs (0.3) - (8.1) (7.4)
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Total Other (166.8) (156.0) (111.2) (112.3)
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Unrestricted Cash Increase (Decrease) 5.4 (12.7) 42.6 10.9
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Ending Unrestricted Cash & Cash Equiv. $59.1 $37.8 $59.1 $37.8
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<FN>
* As reported on Form 8-K dated May 27, 1994.
Page 7 of 7
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