<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): March 30, 1995
------------------------------------------------------------------
(March 30, 1995)
Ames Department Stores, Inc.
-----------------------------------------------------
(Exact Name of Registrant As Specified In Its Charter)
Delaware
----------------------------------------------
(State Or Other Jurisdiction Of Incorporation)
1-5380 04-2269444
------------------------ ---------------------------------
(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 9 (Including Exhibits)
<PAGE>
<PAGE>
ITEM 5: OTHER EVENTS
On March 23, 1995 Ames Department Stores, Inc. (the "Company")
publicly released its audited results of operations and balance sheet for
the fiscal year ended January 28, 1995 ("fiscal 1994"). Beginning on March
30, 1995, the Company will distribute, to certain of its banks and other
lenders, principal trade vendors and factors, summaries of its financial
results for the four (unaudited) and fifty-two weeks ended January 28, 1995
and for the four weeks ended February 25, 1995 (unaudited). These monthly
and year-to-date results (collectively, the "monthly results") are attached
hereto as Exhibits 20-A and 20-B and are incorporated by reference herein.
Sales for the four weeks ended January 28, 1995 ("fiscal January")
were $2.2 million better than the projections contained in the Form 8-K
dated May 27, 1994 (the "FY 1994 Plan") primarily due to above-plan sales
performances in both apparel and home products. EBITDA (as defined in
Exhibit 20-B) for fiscal January was $1.0 million better than FY 1994 Plan
primarily reflecting the gain on the sale of an office building in West
Hartford, CT and the improvement in sales, partially offset by a lower-
than-planned gross margin rate (before a certain year-end reclassification
related to vendor allowances as explained below). The gross margin rate
prior to the reclassification was below FY 1994 Plan for fiscal January
primarily because of higher-than-planned inventory shortage and markdowns.
In January, certain year-to-date vendor allowances, which had been
recorded during the year as an offset to advertising expense, were
reclassified to gross margin, resulting in an increase to both gross margin
and total expenses. Before the reclassification, gross margin and total
expenses for fiscal January were below FY 1994 Plan.
Sales and EBITDA for fiscal 1994 were, respectively, $31.3 million and
$8.4 million less than FY 1994 Plan. EBITDA was $10.4 million greater than
last year. The fiscal 1994 unfavorable sales variance against FY 1994 Plan
was due primarily to shortfalls in ladies apparel, crafts, and convenience
goods. The lower fiscal 1994 gross margin rate was due primarily to
higher-than- planned markdowns, particularly in apparel. The unfavorable
impact on the fiscal 1994 EBITDA from the lower-than-planned sales and
gross margin rate was partially offset by lower-than-planned expenses and
higher property gains. Fiscal 1994 store, field and home office expenses
were all less than FY 1994 Plan.
As of January 28, 1995, merchandise inventories were $21.7 million
greater than FY 1994 Plan, primarily in apparel categories. The variance
was due primarily to special purchases, as well as sales shortfalls in
certain merchandise categories. Trade payables were $39.5 million greater
than FY 1994 Plan due primarily to improved payment terms. As of January
28, 1995 the Company had no borrowings outstanding under its revolving line
of credit. The Company met its 30-day "clean-up" requirements in January
and is in compliance with its debt covenants through the quarter ended
January 28, 1995.
Page 2 of 9
<PAGE>
<PAGE>
Sales for the four weeks ended February 25, 1995 ("fiscal February")
were $.3 million better than the projections contained in the Form 8-K
dated February 16, 1995 (the "FY 1995 Plan"); however, EBITDA for fiscal
February was $.6 million below the FY 1995 Plan due primarily to a lower-
than-planned gross margin rate, partially offset by lower expenses. The
gross margin rate was below FY 1995 Plan because of higher-than-planned
markdowns. Store, field and home office expenses were below FY 1995 Plan
in fiscal February.
As of February 25, 1995, merchandise inventories were $17.3 million
below FY 1995 Plan due primarily to the timing of merchandise purchases.
Trade payables were $27.7 million above FY 1995 Plan due primarily to
improved payment terms. Outstanding borrowings under the Company's
revolving line of credit were $43.5 million below FY 1995 Plan due
primarily to the above factors.
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 28, 1995 to be filed in April, 1995, the
Company's Form 10-Q for the first, second and third quarters ended April
30, July 30 and October 29, 1994, respectively, the Company's Form 8-K
dated May 27, 1994 and the Company's Form 8-K dated February 16, 1995. 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.
Although the Company has continued to make its monthly results public,
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 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 for February 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-A Financial Summary Results for the Four
Weeks (Unaudited) and Fifty-Two Weeks Ended
January 28, 1995.
Exhibit: 20-B Unaudited Financial Summary Results for the
Four Weeks Ended February 25, 1995.
Page 3 of 9
<PAGE>
<PAGE>
INDEX TO EXHIBITS
Exhibit No. Exhibit Page No.
----------- ------- --------
20-A Financial Summary Results for the 6
Four Weeks (Unaudited) and Fifty-Two
Weeks Ended January 28, 1995.
20-B Unaudited Financial Summary Results for 8
the Four Weeks Ended February 25, 1995.
Page 4 of 9
<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: March 29, 1995 By: /s/ Joseph R. Ettore
----------------------------
Joseph R. Ettore
President, Director, and
Chief Executive Officer
Dated: March 29, 1995 By: /s/ John F. Burtelow
----------------------------
John F. Burtelow
Executive Vice President,
Chief Financial Officer
Dated: March 29, 1995 By: /s/ William C. Najdecki
----------------------------
William C. Najdecki
Senior Vice President,
Chief Accounting Officer
Page 5 of 9
<PAGE>
<TABLE>
AMES DEPARTMENT STORES, INC. Exhibit 20 - A
JANUARY RESULTS VS. PLAN Page 1 of 2
MANAGEMENT FORMAT
(In Millions)
<CAPTION>
Jan 1995 (Unaudited) Total Fiscal 1994
Last Last
Actual Plan (a) Yr (b) Actual Plan (a) Yr (b)
<S> <C> <C> <C> <C> <C> <C>
INCOME SUMMARY:
Net Sales $116.1 $113.9 $97.0 $2,142.8 $2,174.1 $2,123.5
FIFO Margin $ 28.2 23.0 25.0 566.1 593.8 576.6
Margin % 24.3% 20.2% 25.8% 26.4% 27.3% 27.2%
Total Expenses 46.5 38.6 41.7 533.0 545.7 538.3
Gain on Dispos. of Properties 2.9 - - 8.3 1.9 1.3
---------------------------------------------------
EBIT (15.4) (15.6) (16.7) 41.4 50.0 39.6
Net Interest Expense 1.2 1.4 1.8 25.4 27.0 26.4
Non-Cash Inc. Tax Prov.(Ben.) (4.2) (5.5) 3.3 8.2 11.4 3.3
Extraordinary Loss (Gain) - - - 1.5 1.5 (0.9)
Non-Recurring (Gain)-Wertheim - - - (12.0) (12.0) -
Dist. Center Closing Costs (1.2) - - 1.3 - -
---------------------------------------------------
Net Income (Loss) ($11.2) ($11.5) ($21.8) $17.0 $22.1 $10.8
===================================================
From EBIT:
Non-Cash SARs Exp.(Credit) - - - - 1.5 -
Depr/Amort, LIFO, & other,net 1.1 0.3 (0.7) 3.1 1.4 (5.5)
---------------------------------------------------
EBITDA ($14.3) ($15.3) ($17.4) $44.5 $52.9 $34.1
===================================================
BALANCE SHEET SUMMARY:
Balance at End of Period
Last
Actual Plan (a) Yr (b)
---------------------------
Unrestricted Cash and Cash Equivalents $28.4 $26.4 $16.5
Restricted Cash and Cash Equivalents 2.0 - 56.0
Merchandise Inventories, LIFO 430.2 408.5 442.2
Other Current Assets 25.8 33.4 28.8
---------------------------
Total Current Assets 486.4 468.3 543.5
Net Fixed Assets 41.0 51.5 21.6
Other Assets and Deferred Charges 6.0 4.5 2.0
---------------------------
Total Assets $533.4 $524.3 $567.1
===========================
Trade Accounts Payable $130.7 $91.2 $74.1
Short-Term Debt (Revolver) - 15.0 15.4
Other Current Liabilities 162.9 173.8 233.0
---------------------------
Total Current Liabilities 293.6 280.0 322.5
Long-Term Debt 39.0 39.1 51.4
Other Long-Term Liabilities 44.3 42.9 52.9
Unfavorable Lease Liability 22.9 22.9 25.1
Fresh-start Excess Net Assets (Negative Goodwill) 48.7 48.8 54.8
Paid-In-Capital 80.9 80.7 73.5
Retained Earnings (Deficit) 4.0 9.9 (13.1)
---------------------------
Total Stockholders' Equity 84.9 90.6 60.4
---------------------------
Total Liabilities & Equity $533.4 $524.3 $567.1
===========================
<FN>
(a) As reported on Form 8-K dated May 27, 1994.
(b) Certain reclassifications have been made to the fiscal 1993 account
balances to conform to the current year presentation.
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 9
</TABLE>
<PAGE>
<TABLE>
AMES DEPARTMENT STORES, INC. Exhibit 20 - A
JANUARY RESULTS VS. PLAN Page 2 of 2
MANAGEMENT FORMAT
(In Millions)
<CAPTION>
Jan 1995 (Unaud) Total Fiscal 1994
Actual Plan (a) Actual Plan (a)
<S> <C> <C> <C> <C>
CASH FLOW SUMMARY:
Beg. Unrestricted Cash & Cash Equiv. $59.1 $37.8 $16.5 $26.9
Cash Generated from (Used in) Operations:
Net Income (Loss) (11.2) (11.5) 17.0 22.1
Non-Cash Income Tax Prov (Ben) (4.2) (5.5) 8.2 11.4
Other (0.7) 0.6 5.9 6.8
------------------------------------
Cash from Operations (16.1) (16.4) 31.1 40.3
Changes in Working Capital:
FIFO Inventory (increase) decrease (0.1) (11.9) 12.0 31.1
Trade Payables increase (decrease) (3.3) 18.4 56.6 16.3
All Other (10.6) (14.8) (6.0) (15.8)
------------------------------------
Net Changes in Working Capital (14.0) (8.3) 62.6 31.6
Capital Expenditures (0.7) (0.4) (24.5) (32.0)
Decrease in Rest. Cash & Cash Equiv. 0.2 0.2 54.0 58.3
Other:
Short-Term Borrow. (Pymts) - Revolver - 15.0 (15.4) (5.0)
Payments of Capital Leases (0.4) (0.3) (4.0) (3.8)
Payments on Long-Term Debt 0.3 (1.2) (83.8) (82.5)
Increase in Deferred Financing Costs - - (8.1) (7.4)
------------------------------------
Total Other (0.1) 13.5 (111.3) (98.7)
------------------------------------
Unrestricted Cash Increase (Decrease) (30.7) (11.4) 11.9 (0.5)
------------------------------------
Ending Unrestricted Cash & Cash Equiv. $28.4 $26.4 $28.4 $26.4
====================================
<FN>
(a) As reported on Form 8-K dated May 27, 1994.
Page 7 of 9
</TABLE>
<PAGE>
<TABLE>
AMES DEPARTMENT STORES, INC. Exhibit 20 - B
FEBRUARY RESULTS VS. PLAN Page 1 of 2
MANAGEMENT FORMAT
(Unaudited)
(In Millions)
<CAPTION>
Feb and Year-to-Date 1995
Last
Actual Plan (a) Yr (b)
<S> <C> <C> <C>
INCOME SUMMARY:
Net Sales $125.3 $125.0 $121.5
FIFO Margin $ 29.4 31.6 30.3
Margin $ 23.5% 25.3% 24.9%
Total Expenses (40.1) (41.6) (41.8)
Other Income/Property Gains 1.8 1.7 2.9
---------------------------
EBITDA (8.9) (8.3) (8.6)
Depreciation and Amort (net) (0.1) (0.1) 0.2
Net Interest Expense (1.4) (1.6) (1.8)
Other Expense, Incl LIFO (0.1) - (0.3)
Non-Cash Inc. Tax Exp. (Ben.) 3.2 3.0 -
---------------------------
Net Income (Loss) ($7.3) ($7.0) ($10.5)
===========================
Balance at end of Period
Last
Actual Plan (a) Yr (b)
---------------------------
BALANCE SHEET SUMMARY:
Cash and Cash Equivalents $22.0 $22.7 $78.1
Merchandise Inventories, LIFO 461.5 478.8 467.6
Other Current Assets 32.7 30.9 28.4
---------------------------
Total Current Assets 516.2 532.4 574.1
Net Fixed Assets 41.3 41.7 21.4
Long Term Assets 5.6 5.8 1.9
---------------------------
Total Assets $563.1 $579.9 $597.4
===========================
Trade Accounts Payable $146.1 $118.4 $105.0
Short-Term Debt (Revolver) 31.5 75.0 33.5
Other Current Liabilities 163.1 157.3 232.1
---------------------------
Total Current Liabilities 340.7 350.7 370.6
Long-Term Debt 30.0 39.2 44.9
Other Long-Term Liabilities 43.9 42.4 52.8
Unfavorable Lease Liability 22.7 22.7 24.9
Fresh-start Excess Net Assets (Negative Goodwill) 48.2 48.2 54.3
Paid-In-Capital 81.0 80.3 73.5
Retained Earnings (Deficit) (3.4) (3.6) (23.6)
---------------------------
Total Stockholders' Equity 77.6 76.7 49.9
---------------------------
Total Liabilities & Equity $563.1 $579.9 $597.4
===========================
<FN>
(a) As reported on Form 8-K dated February 16, 1995.
(b) Certain reclassifications have been made to the fiscal 1994 account
balances to conform to the current year presentation.
NOTE: EBITDA is earnings (loss) before net interest expense, income taxes,
LIFO expense, extraordinary or non-recurring items, depreciation and
amortization and other non-cash charges.
Page 8 of 9
</TABLE>
<PAGE>
<TABLE>
AMES DEPARTMENT STORES, INC. Exhibit 20 - B
FEBRUARY RESULTS VS. PLAN Page 2 of 2
MANAGEMENT FORMAT
(Unaudited)
(In Millions)
<CAPTION>
Feb and YTD 1995
Actual Plan (a)
<S> <C> <C>
CASH FLOW SUMMARY:
Beginning Cash & Cash Equivalents $30.4 $15.2
Cash Generated from (Used in) Operations:
Net Income (Loss) (7.3) (7.0)
Non-Cash Income Tax Exp (Ben) (3.2) (3.0)
Other 0.3 0.4
------------------
Cash from Operations (10.2) (9.6)
Changes in Working Capital:
FIFO Inventory (increase) decrease (31.3) (47.8)
Trade Payables increase (decrease) 15.4 (6.0)
All Other (3.2) 6.4
------------------
Net Changes in Working Capital (19.1) (47.4)
Capital Expenditures (0.7) (0.6)
Other:
Short-Term Borrow.(Pymnts)- Revolver 31.5 75.0
Capital Lease Payments (0.4) (1.6)
Long-Term Debt Payments (9.5) (8.3)
------------------
Total Other 21.6 65.1
------------------
Increase (Decrease) in Cash & Cash Equiv (8.4) 7.5
------------------
Ending Cash & Cash Equivalents $22.0 $22.7
==================
<FN>
(a) As reported on Form 8-K dated February 16, 1995
Page 9 of 9
</TABLE>
