UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended August 27, 1998
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[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from __________ to __________
Commission File Number 1-12604
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THE MARCUS CORPORATION
-----------------------------------------------------
(Exact name of registrant as specified in its charter)
Wisconsin 39-1139844
- --------------------------------------------- --------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.
250 East Wisconsin Avenue, Suite 1700
Milwaukee, Wisconsin 53202
- --------------------------------------------- --------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (414) 905-1000
--------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Sections 12, 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 filing
requirements for the past 90 days.
Yes X No _____
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
COMMON STOCK OUTSTANDING AT SEPTEMBER 30, 1998 - 18,520,585
CLASS B COMMON STOCK OUTSTANDING AT SEPTEMBER 30, 1998 - 12,668,928
1
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THE MARCUS CORPORATION
----------------------
INDEX
PART I - FINANCIAL INFORMATION Page
Item 1. Consolidated Financial Statements:
Balance Sheets
(August 27, 1998 and May 28, 1998)............................. 3
Statements of Earnings
(Thirteen weeks ended August 27, 1998, twelve weeks
ended August 21, 1997 (as reported) and thirteen weeks
ended August 28, 1997 (pro forma).............................. 5
Statements of Cash Flows
(Thirteen weeks ended August 27, 1998 and twelve weeks
ended August 21, 1997)........................................ 6
Condensed Notes to Financial Statements....................... 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.......................... 8
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K............................. 13
Signatures................................................... 14
2
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
THE MARCUS CORPORATION
Consolidated Balance Sheets
(Unaudited) (Audited)
August 27, May 28,
1998 1998
----------- ----------
(in thousands)
ASSETS
Current assets:
Cash and cash equivalents $3,000 $4,678
Accounts and notes receivable 16,701 14,294
Receivables from joint ventures 1,307 1,288
Refundable income taxes - 4,385
Other current assets 2,999 3,773
----------- -----------
Total current assets 24,007 28,418
Property and equipment:
Land and improvements 84,929 85,282
Buildings and improvements 459,601 440,737
Leasehold improvements 9,378 9,355
Furniture, fixtures and equipment 190,664 187,341
Construction in progress 23,042 27,510
----------- -----------
Total property and equipment 767,614 750,225
Less accumulated depreciation and
amortization 195,351 190,229
----------- -----------
Net property and equipment 572,263 559,996
Other assets:
Investments in joint ventures 1,761 1,496
Other 18,566 18,594
----------- -----------
Total other assets 20,327 20,090
----------- -----------
TOTAL ASSETS $616,597 $608,504
=========== ===========
See accompanying notes to consolidated financial statements.
3
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THE MARCUS CORPORATION
Consolidated Balance Sheets
(Unaudited) (Audited)
August 27, May 28,
1998 1998
(in thousands)
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Notes payable $5,218 $5,255
Accounts payable 18,133 26,385
Income taxes 3,360 -
Taxes other than income taxes 11,725 11,404
Accrued compensation 4,264 2,643
Other accrued liabilities 15,479 10,072
Current maturities on long-term debt 10,411 10,277
------- --------
Total current liabilities 68,590 66,036
Long-term debt 200,582 205,632
Deferred income taxes 27,380 26,479
Deferred compensation and other 8,528 7,826
Shareholders' equity:
Preferred Stock, $1 par; authorized 1,000,000 shares;
none issued
Common Stock, $1 par; authorized 50,000,000 shares;
issued 18,519,345 shares at August 27, 1998,
18,511,866 shares at May 28, 1998 18,520 18,512
Class B Common Stock, $1 par; authorized 33,000,000
shares; issued and outstanding 12,670,168 at
August 27, 1998, 12,677,656 at May 28, 1998 12,670 12,678
Capital in excess of par 40,387 40,265
Retained earnings 248,072 235,708
-------- --------
319,649 307,163
Less cost of Common Stock in treasury (1,128,405
shares at August 27, 1998 and 944,544 shares at May 28,
1998) 8,132 4,632
------- -------
Total shareholders' equity 311,517 302,531
------- -------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $616,597 $608,504
========= =========
See accompanying notes to consolidated financial statements.
4
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THE MARCUS CORPORATION
Consolidated Statements of Earnings (Unaudited)
(As reported) (Pro forma)(1)
13 Weeks Ended 12 Weeks Ended 13 Weeks Ended
Aug. 27, 1998 Aug. 21, 1997 Aug. 28, 1997
------------- ------------- -------------
(in thousands, except per share data)
Revenues:
Rooms and telephone $52,049 $47,048 $50,421
Theatre operations 33,179 23,580 24,705
Food and beverage 13,870 12,546 13,513
Other income 8,262 6,879 7,472
--------- ---------- -----------
Total revenues 107,360 90,053 96,111
Costs and expenses:
Rooms and telephone 18,650 15,741 17,179
Theatre operations 19,374 14,283 15,002
Food and beverage 9,269 8,380 9,009
Advertising and marketing 6,515 5,415 5,891
Administrative 9,753 7,836 8,414
Depreciation and amortization 9,245 7,226 7,882
Rent 1,038 1,069 1,103
Property taxes 3,474 2,713 2,868
Other operating expenses 3,944 3,185 3,319
--------- --------- ----------
Total costs and expenses 81,262 65,848 70,667
--------- --------- ----------
Operating income 26,098 24,205 25,444
Other income (expense):
Investment income 176 349 388
Interest expense (4,016) (2,765) (3,037)
Gain on disposition of property
and equipment 1,387 (1) 1
-------- ---------- ----------
(2,453) (2,417) (2,648)
-------- ---------- ----------
Earnings before income taxes 23,645 21,788 22,796
Income taxes 9,454 8,723 9,127
======== ========== ==========
Net earnings $14,191 $13,065 $13,669
======== ========== ==========
Net earnings per share(2):
Basic $0.47 $0.44 $0.46
Diluted $0.47 $0.44 $0.46
Weighted Average Shares
Outstanding(2):
Basic 30,201 29,601 29,603
Diluted 30,362 29,840 29,842
(1) Pro forma information is presented as if the prior year had been reported on
the new 13-week basis.
(2) All per share and shares outstanding data have been adjusted to reflect the
50% stock dividend distributed on December 5, 1997.
See accompanying notes to consolidated financial statements.
5
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THE MARCUS CORPORATION
Consolidated Statements of Cash Flows (Unaudited)
13 Weeks 12 Weeks
Ended Ended
Aug. 27, 1998 Aug. 21, 1997
------------- -------------
(in thousands)
OPERATING ACTIVITIES:
Net earnings $14,191 $13,065
Adjustments to reconcile net earnings to net
cash provided by operating activities:
Earnings on investments in joint ventures, net
of distributions (265) 9
(Gain) loss on disposition of
property and equipment (1,387) 1
Depreciation and amortization 9,245 7,226
Deferred income taxes 901 250
Deferred compensation and other 702 1,283
Changes in assets and liabilities:
Accounts and notes receivable (2,407) (4,478
Other current assets 774 (125
Accounts payable (8,252) 6,537
Income taxes 7,745 6,898
Taxes other than income taxes 321 1,434
Accrued compensation 1,621 1,739
Other accrued liabilities 5,407 1,949
------- ------
Total adjustments 14,405 22,723
------- ------
Net cash provided by operating activities 28,596 35,788
INVESTING ACTIVITIES:
Capital expenditures (21,762) (18,266
Net proceeds from disposals of property,
equipment and other assets 1,760 -
(Increase) decrease in other assets (317) 721
Cash received from (advanced to) joint ventures (19) 29
--------- -------
Net cash used in investing activities (20,338) (17,516)
FINANCING ACTIVITIES:
Debt transactions:
Net proceeds from issuance of notes
payable and long-term debt 576 -
Principal payments on notes payable
and long-term debt (5,529) (3,136)
Equity transactions:
Treasury stock transactions, except
for stock options (3,805) (88
Exercise of stock options 425 384
Dividends paid (1,603) (1,516)
--------- --------
Net cash used in financing activities (9,936) (4,356)
--------- --------
Net increase (decrease) in cash and cash equivalents (1,678) 13,916
Cash and cash equivalents at beginning of year 4,678 7,991
--------- -------
Cash and cash equivalents at end of period $3,000 $21,907
========= =======
See accompanying notes to consolidated financial statements.
6
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THE MARCUS CORPORATION
CONDENSED NOTES TO FINANCIAL STATEMENTS FOR THE
THIRTEEN WEEKS ENDED
AUGUST 27, 1998
(Unaudited)
A. Refer to the Company's audited financial statements (including footnotes)
for the fiscal year ended May 28, 1998, contained in the Company's Form
10-K Annual Report for such fiscal year, for a description of the Company's
accounting policies.
B. Beginning in fiscal 1999, the Company is dividing its fiscal year into
three 13-week quarters and a final quarter consisting of 13 or 14 weeks.
Previously, the Company's fiscal year consisted of three 12-week quarters
and a fourth quarter of 16 or 17 weeks. Comparative results for the first
quarter of fiscal 1998 are presented on a pro forma basis, as if the
quarter had been reported on the new basis.
C. The consolidated financial statements for the thirteen weeks ended August
27, 1998, twelve weeks ended August 21, 1997 and pro forma thirteen weeks
ended August 28, 1997 have been prepared by the Company without audit. In
the opinion of management, all adjustments consisting only of normal
recurring accruals necessary to present fairly the unaudited interim
financial information at August 27, 1998, and for all periods presented,
have been made.
D. The Company's Board of Directors declared a three-for-two stock split,
effected in the form of a 50% stock dividend, distributed on December 5,
1997, to all holders of Common Stock and Class B Common Stock. All per
share and weighted average shares outstanding data prior to December 5,
1997, have been adjusted to reflect this dividend.
7
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Item 2. Management's Discussion and Analysis of Results of Operations and
Financial Condition
Special Note Regarding Forward-Looking Statements
Certain matters discussed in this Management's Discussion and Analysis
of Results of Operations and Financial Condition are "forward-looking
statements" intended to qualify for the safe harbors from liability established
by the Private Securities Litigation Reform Act of 1995. These forward-looking
statements can generally be identified as such because the context of the
statement will include words such as the company "believes," "anticipates,"
Aexpects@ or words of similar import. Similarly, statements that describe the
Company's future plans, objectives or goals are also forward-looking statements.
Such forward looking statements are subject to certain risks, assumptions and
uncertainties which are described in close proximity to such statements and
which may cause actual results to differ materially from those currently
anticipated. Shareholders, potential investors and other readers are urged to
consider these risks, assumptions and uncertainties carefully in evaluating the
forward-looking statements and are cautioned not to place undue reliance on such
forward-looking statements. The forward-looking statements made herein are only
made as of the date of this Form 10-Q and the Company undertakes no obligation
to publicly update such forward-looking statements to reflect subsequent events
or circumstances.
RESULTS OF OPERATIONS
General
The Marcus Corporation and its four divisions report their consolidated
and individual segment results of operations on a 52-or 53-week fiscal year
ending on the last Thursday in May. Fiscal 1999 will be a 52-week year for the
Company and each of its divisions. Fiscal 1998 was a 53-week fiscal year for the
Company's restaurant division, while the Company and its other remaining
divisions reported a 52-week year in fiscal 1998.
Historically, the Company's fiscal year has been divided into three
12-week quarters and a final quarter consisting of 16 or 17 weeks. Beginning in
fiscal 1999, the Company will divide its fiscal year into three 13-week quarters
and a final quarter consisting of 13 or 14 weeks. The Company has made this
change in order to simplify its reporting process and provide greater
consistency between quarters. To facilitate comparisons with fiscal 1999
quarterly results, comparative results for the first quarter of fiscal 1998 are
presented on a pro forma basis, as if the quarter had been reported on the new
basis.
Revenues for the first quarter of fiscal 1999 ended August 27, 1998,
totaled $107.4 million, an increase of $11.2 million, or 11.7%, from pro forma
revenues of $96.1 million for the first quarter of fiscal 1997. Revenues
reported for the 12-week quarter ended August 21, 1997 totaled $90.1 million.
All four operating segments contributed to the increase in revenues this past
quarter, with the theatre division contributing the largest increase over the
prior year.
8
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Net earnings for the first quarter of fiscal 1999 were $14.2 million,
or $.47 per share, up 3.8% and 2.2%, respectively, from pro forma net earnings
of $13.7 million, or $.46 per share, for the same quarter during the prior year.
Net earnings reported for the 12-week quarter ended August 21, 1997 were $13.1
million, or $.44 per share. All earnings per share data have been adjusted to
reflect the three-for-two stock split effected in the form of a 50% stock
dividend on December 5, 1997. The Company adopted SFAS No. 128, "Earnings Per
Share," in fiscal 1998. Prior period amounts have been restated under the new
standard. All per share data presented herein is on a diluted basis.
Operating income (earnings before other income/expense and income
taxes) totaled $26.1 million during the first quarter of fiscal 1999, an
increase of $650,000, or 2.6%, compared to the pro forma prior year same period.
The Company's interest expense, net of investment income, totaled $3.8 million
for the first quarter of fiscal 1999, compared to $2.4 million during the same
period last year on a pro forma basis. This increase was the result of increased
long-term debt levels necessary to help finance the Company's capital program,
combined with reduced investment income and capitalized interest.
The Company is conducting a review of its computer systems to identify
those areas that may be affected by the Year 2000 issue and is developing an
implementation plan to resolve the issue. The Company expects the project to be
substantially complete by early 1999 and does not, at this time, expect this
project to have a significant effect on the business, results of operations or
financial condition of the Company. The Company began converting critical
accounting and data processing systems in fiscal 1998 in the normal course of
business and expects that the new systems will provide business benefits in
addition to being ready for the Year 2000. The Company is also assessing the
impact of this issue with its key vendors and suppliers.
Limited-Service Lodging
Total revenues for the first quarter of fiscal 1999 for the
limited-service lodging division were $41.9 million, an increase of $200,000, or
0.6%, compared to pro forma revenues of $41.7 million during the same period in
fiscal 1998. The limited-service lodging division's operating income for the
fiscal 1999 first quarter totaled $12.8 million, a decrease of $1.0 million, or
7.2%, from pro forma operating income of $13.8 million during the same period of
fiscal 1998. The division reported revenues of $38.7 million and operating
income of $13.0 million for the 12-week quarter ended August 21, 1997.
Compared to the end of the first quarter of fiscal 1998, one new
Company-owned or operated and 15 new franchised Budgetel/Baymont Inns were in
operation at the end of the fiscal 1999 first quarter. The Company's newly
opened Budgetel Inns contributed additional revenues of $700,000 to the
division's fiscal 1999 first quarter revenues. The Company experienced lower
occupancy rates and higher average daily room rates for comparable Budgetel Inns
during the first quarter of fiscal 1999, compared to the same quarter last year.
The result of the occupancy decline and average daily rate increases was a 0.9%
increase in the division's revenue per available room, or RevPAR, for comparable
Budgetel Inns during the fiscal 1999 first quarter.
9
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The limited-service lodging division's results continue to be impacted
by the increased limited service segment room supply, resulting in minimal
RevPAR growth and pressure on the division's operating margin. Reduced occupancy
percentages, combined with increased payroll costs in a tight labor market and
increased administrative costs associated with the Company's recent expansion
program, have contributed to the lower operating margins. The Company expects
these trends to continue during the fiscal 1999 second quarter.
During the first quarter of fiscal 1999, the Company continued to
prepare for its previously announced name change of its Budgetel Inns to Baymont
Inns and Baymont Inns & Suites. Completion of the repositioning to Baymont has
been extended to January 1999 in response to previously unanticipated delays in
completing the necessary signage for all properties and to ensure that the
quality and consistency of new features and amenities will be uniform throughout
the chain when the name change becomes effective.
At the end of the fiscal 1999 first quarter, the Company owned or
operated 106 Budgetel/Baymont Inns and franchised an additional 55 Inns,
bringing the total number of Budgetel/Baymont Inns in operation to 161. In
addition, there are currently 22 franchised locations under construction or in
development, all of which are scheduled to open in fiscal 1999 or shortly
thereafter. The Company also owns and operates five Woodfield Suites all-suite
motels. Two company-owned Woodfield Suites are currently under construction.
Theatres
The theatre division's fiscal 1999 first quarter revenues were $33.3
million, an increase of $8.5 million, or 34.1%, over pro forma revenues of $24.8
million during the same fiscal 1998 period. Operating income for the first
quarter of fiscal 1999 totaled $8.1 million, an increase of $2.5 million, or
44.8%, over pro forma operating income of $5.6 million during the same period
last year. The division reported revenues of $23.7 million and operating income
of $5.5 million for the 12-week quarter ended August 21, 1997.
Total box office receipts for the fiscal 1999 first quarter were $22.4
million, an increase of $5.8 million, or 34.9%, over pro forma box office
receipts of $16.6 million during the same period last year. The increase in box
office receipts for the first quarter of fiscal 1999 compared to the same period
during the prior year was due to 77 additional screens, a strong summer season
of movies and continued popularity of stadium seating, together with a 3.4%
increase in average ticket prices. Vending revenues for the fiscal 1999 first
quarter totaled $10.2 million, an increase of $2.8 million, or 37.0%, over pro
forma vending revenues of $7.4 million during the same quarter last year. The
increase in vending revenues was due to increased theatre attendance and a 4.8%
increase in average concession sales per person compared to the same quarter
last year. Total theatre attendance increased 30.5% over pro forma total
attendance during the same quarter last year. Attendance at the Company's
comparable locations increased 8.7% during the fiscal 1999 first quarter,
compared to the prior year same quarter. Revenues for the theatre business and
the motion picture industry in general are heavily dependent upon the general
audience appeal of available films, together with studio marketing, advertising
and support campaigns, factors over which the Company has no control.
10
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The Company opened 16 new screens at existing theatres and closed three
screens in the first quarter of fiscal 1999, ending the first quarter with a
total of 374 total screens in 45 theatres compared to 297 screens in 40 theatres
at the end of the same period last year. Early in the second quarter of fiscal
1999, the Company closed three more screens and opened a new 17-screen
ultraplex, including its first IMAX(R) theatre, in suburban Columbus, Ohio. The
Company currently has 38 additional screens either under construction or about
to go under construction this fall, including a new 15-screen ultraplex in the
Minneapolis metropolitan area. During the first quarter of fiscal 1999, the
Company also continued to retrofit existing theatres with stadium seating. The
Company's goal is to add stadium seating to a majority of its existing screens
by the end of fiscal 2000. The Company expects to begin construction shortly on
its second IMAX(R) theatre at the 20-screen Marcus Cinemas of Addison, Illinois
and expects to commence construction on up to 23 additional screens by the end
of the fiscal year. The Company is also pursuing additional acquisition
opportunities.
Hotels and Resorts
Total revenues from the hotels and resorts division during the first
quarter of fiscal 1999 increased by $2.4 million, or 10.8%, to $24.2 million,
compared to pro forma revenues of $21.8 million in the previous year's
comparable period. Operating income decreased by $1.1 million, or 16.3%, to $5.3
million during the fiscal 1999 first quarter, compared to pro forma operating
income of $6.4 million during the first quarter of fiscal 1998. The division
reported revenues of $20.3 million and operating income of $6.0 million for the
12-week quarter ended August 21, 1997.
Revenues from the Company's new Miramonte Resort in Indian Wells,
California and improved RevPAR at all three of the Company's comparable owned
hotels contributed to the revenue increases in the fiscal 1999 period compared
to the prior year's period. The division's total RevPAR for comparable
properties increased 9.0% during fiscal 1999's first quarter compared to the
same quarter last year. Operating income increased at all three comparable owned
properties as well. Total division operating income was negatively impacted in
the first quarter of fiscal 1999 by approximately $300,000 of pre-opening cost
amortization and anticipated start-up operating losses at the Miramonte during
the traditionally slow summer season in the Palm Springs desert area. The
Company expects the Miramonte to continue to have a negative impact on division
operating income during the second and third quarters of fiscal 1999 until
pre-opening costs are fully amortized and the property operates its first
complete peak season.
The Company began construction early in the second quarter of fiscal
1999 on a 250-room expansion of the Milwaukee Hilton, which will be connected to
Milwaukee's newly opened Midwest Express Convention Center and will create the
largest hotel in Wisconsin. The addition is currently scheduled to open in 2000.
Madison's City Council recently approved the development agreement for the
division's new Company-owned Monona Terrace Hilton in Madison, Wisconsin.
Projected completion of the property, which will be connected to the city's new
Monona Terrace Convention Center, is in the fall of 2000.
11
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Restaurants
Restaurant division revenues totaled $7.8 million for the first quarter
of fiscal 1999, an increase of $100,000, or 1.4%, over fiscal 1998 pro forma
first quarter revenues of $7.7 million. The division's operating income for the
fiscal 1999 first quarter totaled $1.0 million, a decrease of $100,000, or
11.9%, from pro forma operating income of $1.1 million during the first quarter
of fiscal 1998. The division reported revenues of $7.3 million and operating
income of $1.0 million for the 12-week quarter ended August 21, 1997.
Total division operating income declined slightly during the fiscal
1999 first quarter compared to the prior year's same period due to a one-time
insurance adjustment from a prior claim that was settled during the quarter.
Excluding the insurance adjustment, the Company's KFC restaurants reported
increases in revenue and operating income due in part to expanded lunch and
snack business and the continuing success of the division's first 2-in-1
KFC/Taco Bell restaurant in Milwaukee. Two additional 2-in-1 combination
restaurant conversions are under development and are expected to open late in
the third quarter of fiscal 1999.
FINANCIAL CONDITION
The Company's lodging, movie theatre and restaurant businesses each
generate significant and consistent daily amounts of cash because each segment's
revenue is derived predominantly from consumer cash purchases. The Company
believes that these consistent and predictable cash sources, together with the
availability to the Company of $37 million of unused credit lines at the end of
the first quarter, should be adequate to support the ongoing operational
liquidity needs of the Company's businesses.
Net cash provided by operating activities decreased by $7.2 million
during the 13-week first quarter of fiscal 1999 to $28.6 million, compared to
$35.8 million during the prior year's 12-week first quarter. The decrease
compared to the same period last year was primarily the result of timing
differences in payments of accounts payable, offset by increased net earnings
and depreciation/amortization.
Net cash used in investing activities during the fiscal 1999 first
quarter totaled $20.3 million, compared to $17.5 million during the fiscal 1998
12-week first quarter. Capital expenditures to support the Company's continuing
expansion program totaled $21.8 million during the first quarter of fiscal 1999
compared to $18.3 million during the prior year's reported first quarter. The
majority of the capital expenditures during the fiscal 1999 first quarter were
incurred in the theatre division to fund new theatres, screen additions to
existing theatres, stadium seating retrofits and construction of the Company's
first IMAX(R) theatre.
Cash used in financing activities during the fiscal 1999 first quarter
totaled $9.9 million, compared to $4.4 million during the 12-week first quarter
of fiscal 1998. During the fiscal 1999 first quarter, the Company repurchased
241,000 of its common shares in the open market pursuant to its long-standing
existing repurchase program, resulting in the increased cash used in financing
activities. An additional 98,000 common shares were repurchased early in the
fiscal 1999 second quarter. The Company announced in the second quarter of
fiscal 1999 that its Board of Directors had authorized the repurchase of up to 1
million additional shares of the Company's outstanding common stock. The
repurchases are expected to be executed on the open market or in privately
negotiated transactions depending upon a number of factors, including prevailing
market conditions.
12
<PAGE>
The Company's long-term debt decreased slightly during the first
quarter of fiscal 1999. The Company expects to issue additional long-term debt
to help fund the Company's ongoing expansion plans in fiscal 1999. The Company
has the ability to issue up to $85 million of additional senior notes under a
private placement program through February 1999.
The actual timing and extent of the implementation of the Company's
current expansion plans will depend in large part on continuing favorable
industry and general economic conditions, the competitive environment, evolving
customer needs and trends and the availability of attractive opportunities. It
is likely that the Company's current expansion goals will continue to evolve and
change in response to these and other factors.
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits
Exhibit 27. Financial Data Schedule
b. Reports on Form 8-K
No Form 8-K was filed by the Company during the quarter to
which this Form 10-Q relates.
13
<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.
THE MARCUS CORPORATION
(Registrant)
DATE: October 12, 1998 By: /s/ Stephen H. Marcus
-------------------------------------------------
Stephen H. Marcus,
Chairman of the Board, President and Chief
Executive Officer
DATE: October 12, 1998 By: /s/ Douglas A. Neis
-------------------------------------------------
Douglas A. Neis
Chief Financial Officer and Treasurer
14
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THE MARCUS CORPORATION
FORM 10-Q
FOR
13 WEEKS ENDED AUGUST 27, 1998
EXHIBIT INDEX
Exhibit Description
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE MARCUS
CORPORATION'S FINANCIAL STATMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAY-27-1999
<PERIOD-START> MAY-29-1998
<PERIOD-END> AUG-27-1998
<CASH> 3,000
<SECURITIES> 0
<RECEIVABLES> 18,008
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 24,007
<PP&E> 767,614
<DEPRECIATION> 195,351
<TOTAL-ASSETS> 616,597
<CURRENT-LIABILITIES> 68,590
<BONDS> 200,582
0
0
<COMMON> 31,190
<OTHER-SE> 280,327
<TOTAL-LIABILITY-AND-EQUITY> 616,597
<SALES> 99,098
<TOTAL-REVENUES> 107,360
<CGS> 47,293
<TOTAL-COSTS> 81,262
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4,016
<INCOME-PRETAX> 23,645
<INCOME-TAX> 9,454
<INCOME-CONTINUING> 14,191
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 14,191
<EPS-PRIMARY> .47
<EPS-DILUTED> .47
</TABLE>
