FORM 8-K
UNITED STATES 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
November 19, 1998
(Date of Report, date of earliest event reported)
Stage Stores, Inc.
(Exact name of registrant as specified in its charter)
Commission file number 00133-1403568258
DELAWARE 76-0407711
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identifications No.)
10201 Main Street, Houston, 77025
Texas (Zip Code)
(Address of principal executive
offices)
(713) 667-5601
(Registrant's telephone number, including area code)
Not Applicable
(Former name or address, if changed since last report)
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ITEM 5. Other Events.
A press release regarding the Company's third quarter and
nine months 1998 results and certain other matters was issued by
the Company on November 19, 1998 and is attached hereto as
Exhibit 99.1.
ITEM 7. Financial Statements and Exhibits.
(a) Financial statements of business acquired.
Not applicable.
(b) Pro forma financial information.
Not applicable.
(c) Exhibits.
99.1 Press release dated November 19, 1998 issued by
the Company.
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<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.
STAGE STORES, INC.
November 19, 1998 /s/ James A. Marcum
(Date) James A. Marcum
Vice Chairman and,
Chief Financial Officer
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NEWS RELEASE
CONTACT:
Bob Aronson
Director of Investor Relations
(800) 579-2302
FOR IMMEDIATE RELEASE
STAGE STORES, INC. ANNOUNCES THIRD QUARTER
AND NINE MONTHS RESULTS
______________________________
HOUSTON, TX, November 19, 1998 -- Stage Stores, Inc. (NYSE: SGE)
today announced results for the third quarter and nine months
ended October 31, 1998.
Net sales for the third quarter of 1998 decreased 1.0% to $271.6
million from $274.3 million for the same period last year. This
year's total sales for the third quarter are not comparable to
sales reported for the third quarter of 1997 as last year's sales
included the liquidation and related strong grand opening volumes
associated with the C.R. Anthony store conversions. Comparable
store sales decreased 2.1% during the quarter. The net loss for
the third quarter was $3.2 million, or $0.11 per share on a
diluted basis, as compared to net income of $3.7 million, or
$0.13 per share before extraordinary items, for the comparable
period last year.
Net sales for the nine months ended October 31, 1998 increased
16.0% to $816.2 million from $703.9 million for the same period
last year. Comparable store sales for the nine-month period
decreased 1.3%. Net income was $6.6 million, or $0.23 per share
on a diluted basis, this year versus $17.0 million, or $0.66 per
share before extraordinary items, a year ago. After
extraordinary items, net income for the nine-month period this
year was $0.23 per share on a diluted basis as compared to a net
loss of $0.02 per share last year.
Carl E. Tooker, Chairman, President and Chief Executive Officer,
stated, "We are disappointed with the results for the third
quarter. We believe weather to be the critical variable which
affected sales in our markets during the third quarter as opposed
to shifts in economic factors.
-- more --
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Stage Stores, Inc. Announces
Third Quarter 1998 Results
Page - 2
Unseasonably warm and adverse weather conditions affected the
majority of our markets throughout the latter half of the
quarter, negatively impacting customer traffic and sales of the
cold weather categories of our business. This more than offset
the promotionally driven positive performance reported for the
first six weeks of the quarter. As a result, the reported loss
for the quarter reflects sales and gross margins being below
plan."
Mr. Tooker, concluded, "In light of our current business trends,
we have been prudent in the management of our inventories and our
selling, general and administrative ("SG&A") expenses. We ended
the quarter with inventories per square foot on a comparable
store basis flat with last year and our SG&A expenses, as a rate
of sales, down over 100 basis points as compared to the prior
period. On an absolute dollar basis, SG&A expenses were lower
this year than last year despite operating over 70 more stores.
We will continue to manage our receipt flows aggressively in
order to maintain appropriate inventory levels for the fall. We
are well positioned to take advantage of the upcoming Christmas
selling season"
During the third quarter, the Company opened 43 stores and closed
2 stores, and expanded its national presence by entering 5
additional states.
Stage Stores, Inc. brings nationally recognized brand name family
apparel, accessories, cosmetics and footwear for the entire
family to small towns and communities throughout the United
States. The company operated 671 stores in 33 states at the end
of the third quarter, primarily under the Stage, Bealls and
Palais Royal trade names.
Any statements in this press release that may be considered
forward-looking statements are subject to risks and uncertainties
that could cause actual results to differ materially. These
risks and uncertainties are discussed in periodic reports filed
by the Company with the Securities and Exchange Commission that
the Company urges investors to consider.
(Tables to Follow)
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Stage Stores, Inc.
Consolidated Condensed Statement of Operations
(in thousands, except per share amounts)
(unaudited)
Three Months Ended Nine Months Ended
10/31/98 11/1/97 10/31/98 11/1/97
Net sales $271,605 $274,269 $816,198 $703,918
Cost of sales and related
buying,
Occupancy and distribution
expenses 196,353 187,447 571,482 481,269
Gross profit 75,252 86,822 244,716 222,649
Selling, general and
administrative expenses 65,140 69,089 194,623 163,752
Store opening and closure costs 2,886 1,944 4,911 2,848
Operating income 7,226 15,789 45,182 56,049
Interest, net 12,394 9,767 34,284 28,158
Income (loss) before income tax
and extraordinary item (5,168) 6,022 10,898 27,891
Income tax expense (benefit) (2,016) 2,349 4,250 10,878
Income (loss) before
extraordinary item (3,152) 3,673 6,648 17,013
Extraordinary item - early
retirement of debt -- (150) -- (17,530)
Net income (loss) $ (3,152) $ 3,523 $ 6,648 $ (517)
Basic earnings (loss) per common
share data:
Basic earnings (loss) per
common share before
Extraordinary item $ (0.11) $ 0.13 $ 0.24 $ 0.67
Extraordinary item - early
retirement of debt -- -- -- (0.69)
Basic earnings (loss) per common
share $ (0.11) $ 0.13 $ 0.24 $ (0.02)
Basic weighted average common
shares outstanding 27,926 27,364 27,864 25,230
Diluted earnings (loss) per
common share data:
Diluted earnings (loss) per
common share before
Extraordinary item $ (0.11) $ 0.13 $ 0.23 $ 0.66
Extraordinary item - early
retirement of debt -- -- -- (0.68)
Diluted earnings (loss) per
common share $ (0.11) $ 0.13 $ 0.23 $ (0.02)
Diluted weighted average common
shares outstanding 28,263 28,113 28,474 25,782
Comparable store sales data (2.1%) 2.8% (1.3%) 4.4%
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Stage Stores, Inc.,
Consolidated Condensed Balance Sheet
(in thousands)
(unaudited)
10/31/98 1/31/98 11/1/97
ASSETS
Cash and cash equivalents $11,226 $ 23,315 $15,274
Undivided interest in accounts
receivable trust 58,971 61,211 64,431
Merchandise inventories, net 421,658 303,115 330,477
Other current assets 82,242 78,205 72,070
Total current assets 574,097 465,846 482,252
Fixed assets, net 225,121 171,654 154,707
Goodwill, net 93,285 95,486 88,391
Other assets 24,858 26,410 55,209
$917,361 $759,396 $780,559
LIABILITIES AND STOCKHOLDERS'
EQUITY
Accounts payable $102,787 $ 91,799 $105,893
Other current liabilities 140,707 55,983 71,892
Total current liabilities 243,494 147,782 177,785
Long-term debt including credit
facilities 450,311 395,248 398,207
Other long-term liabilities 10,436 11,288 19,320
Total liabilities 704,241 554,318 595,312
Stockholders' equity 213,120 205,078 185,247
$917,361 $759,396 $780,559
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Stage Stores, Inc.
Consolidated Condensed Statement of Cash Flows
(in thousands)
(unaudited)
Nine Months Ended
10/31/98 11/1/97
Cash flows from operating activities:
Net income (loss) $ 6,648 $ (517)
Adjustments to net income (loss):
Depreciation and amortization 21,046 13,091
Other 192 19,616
Amortization of debt issue costs and
accretion of discount 2,628 2,729
Changes in working capital (106,691) (48,918)
Net cash used in operating activities (76,177) (13,999)
Cash flows from investing activities:
Acquisitions, net of cash acquired -- (4,946)
Additions to fixed assets (71,202) (41,744)
Net cash used in investing activities (71,202) (46,690)
Cash flows from financing activities:
Proceeds from working capital facility 134,650 46,400
Proceeds from issuance of common stock 839 21,125
Proceeds from long-term debt -- 299,720
Payments on long-term debt (199) (297,161)
Additions to debt issue costs -- (12,407)
Net cash provided by financing 135,290 57,677
activities..
Net decrease in cash and cash equivalents (12,089) (3,012)
Cash and cash equivalents:
Beginning of period 23,315 18,286
End of period $ 11,226 $ 15,274
