FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission file number 0-4095
THOMAS NELSON, INC.
(Exact name of Registrant as specified in its charter)
Tennessee 62-0679364
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification number)
501 Nelson Place, Nashville, Tennessee 37214-1000
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (615) 889-9000
Indicate by check mark whether the Registrant (1) has filed
all reports required to be filed by Section 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 such filing
requirements for the past 90 days.
Yes X No
At February 7, 1997 the Registrant had outstanding
16,001,178 shares of Common Stock and 1,112,071 shares of Class B
Common Stock.
<TABLE>
THOMAS NELSON, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
<CAPTION>
December 31, March 31, December 31,
1996 1996 1995
------------ -------- ------------
(Unaudited) (Unaudited)
<S> <C> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 2,150 $ 672 $ 3,290
Accounts receivable, less
allowances of $7,516, $7,068
and $7,400, respectively 67,555 72,001 70,811
Income tax refunds receivable 3,604 4,440 -
Inventories 71,456 79,308 81,422
Prepaid expenses 8,494 11,221 13,189
Deferred tax asset 14,970 14,970 9,499
Net assets of discontinued
operations 68,657 62,514 79,364
------------ -------- ------------
Total Current Assets 236,886 245,126 257,575
PROPERTY, PLANT AND EQUIPMENT 33,308 35,357 34,851
OTHER ASSETS 12,209 10,201 16,079
DEFERRED CHARGES 2,949 3,284 3,977
GOODWILL 59,262 61,115 59,626
------------ -------- ------------
TOTAL ASSETS $ 344,614 $355,083 $ 372,108
============ ======== ============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 16,935 $ 23,187 $ 18,905
Accrued expenses 16,839 21,502 22,791
Dividends payable 685 685 657
Income taxes currently payable 4,996 - 2,157
Current portion of long-term debt
& capital lease obligation 3,322 2,625 2,581
------------ -------- ------------
Total Current Liabilities 42,777 47,999 47,091
LONG-TERM DEBT 168,239 179,489 191,160
CAPITAL LEASE OBLIGATION 349 527 726
DEFFERRED TAX LIABILITY 3,127 3,127 4,837
OTHER LIABILITIES 1,093 1,876 1,380
SHAREHOLDERS' EQUITY
Preferred stock, $1.00 par value,
authorized 1,000,000 shares;
none issued - - -
Common stock, $1.00 par value,
authorized 20,000,000 shares;
issued 16,003,971, 16,004,368
and 15,305,019 shares,
respectively 16,004 16,004 15,305
Class B common stock, $1.00 par
value, authorized 5,000,000
shares; issued 1,112,075,
1,112,075 and 1,109,993 shares,
respectively 1,112 1,112 1,110
Additional paid-in capital 79,320 78,825 69,678
Retained earnings 32,858 26,952 41,871
Deferred compensation (265) (828) (1,050)
------------ -------- ------------
Total Shareholders' Equity 129,029 122,065 126,914
------------ -------- ------------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $ 344,614 $355,083 $ 372,108
============ ======== ============
See Accompanying Notes
</TABLE>
<TABLE>
THOMAS NELSON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share data)
<CAPTION>
Nine Months Ended Three Months Ended
December 31, December 31,
1996 1995 1996 1995
---------- --------- --------- ---------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
NET REVENUES $ 183,942 $ 155,117 $ 63,557 $ 62,978
COST AND EXPENSES:
Cost of goods sold 98,977 82,119 35,599 34,708
Selling, general and
administrative 65,107 56,942 19,622 22,131
Amortization of goodwill
and non-compete
agreements 1,485 619 496 208
---------- --------- --------- ---------
Total expenses 165,569 139,680 55,717 57,047
---------- --------- --------- ---------
OPERATING INCOME 18,373 15,437 7,840 5,931
Other income 312 338 104 100
Interest expense 7,021 6,036 2,391 2,571
---------- --------- --------- ---------
Income from continuing
operations before income
taxes 11,664 9,739 5,553 3,460
Provision for income taxes 4,432 3,601 2,110 1,279
---------- --------- --------- ---------
Income from continuing
operations, net 7,232 6,138 3,443 2,181
Income (Loss) from
discontinued operations, net 728 (1,406) 803 (535)
---------- --------- --------- ---------
NET INCOME $ 7,960 $ 4,732 $ 4,246 $ 1,646
========== ========= ========= =========
Weighted average number
of shares outstanding:
Primary 17,138 15,310 17,136 16,484
========== ========= ========= =========
Fully-diluted 20,373 18,545 20,371 19,719
========== ========= ========= =========
NET INCOME PER SHARE:
Primary--
Income from continuing
operations $ 0.42 $ 0.40 $ 0.20 $ 0.13
Income (Loss) from
discontinued
operations 0.04 (0.09) 0.05 (0.03)
---------- --------- --------- ---------
$ 0.46 $ 0.31 $ 0.25 $ 0.10
========== ========= ========= =========
Fully-diluted--
Income from continuing
operations $ 0.42 $ 0.40 $ 0.19 $ 0.13
Income (Loss) from
discontinued
operations 0.04 (0.09) 0.04 (0.03)
---------- --------- --------- ---------
$ 0.46 $ 0.31 $ 0.23 $ 0.10
========== ========= ========= =========
DIVIDENDS DECLARED PER SHARE $ 0.120 $ 0.120 $ 0.040 $ 0.040
========== ========= ========= =========
See Accompanying Notes
</TABLE>
<TABLE>
THOMAS NELSON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
<CAPTION>
Nine Months Ended December 31,
------------------------------
1996 1995
------------ -------------
(Unaudited) (Unaudited)
<S> <C> <C>
CASH FLOWS FROM CONTINUING OPERATING
ACTIVITIES:
Net Income $ 7,232 $ 6,138
Adjustments to reconcile net income to
net cash provided by (used in)
operations:
Depreciation and amortization 8,257 5,634
Gain on sale of fixed assets (22) (502)
Deferred compensation 563 -
Changes in assets and liabilities, net of
acquisitions and disposals:
Accounts receivable, net 4,446 2,527
Income tax refunds receivable 836 -
Inventories 7,852 (12,441)
Prepaid expenses 2,727 (121)
Accounts payable and accrued expenses (10,915) (9,592)
Income taxes currently payable and
deferred 4,996 3,307
------------ -------------
Net cash provided by (used in) continuing
operations 25,972 (5,050)
------------ -------------
Discontinued operations:
Income (Loss) from discontinued
operations 728 (1,406)
Items not affecting cash, net 801 (875)
Cash used in discontinued operations (7,259) (24,028)
------------ -------------
Net cash used in discontinued operations (5,730) (26,309)
------------ -------------
Net cash provided by (used in) operating
activities 20,242 (31,359)
------------ -------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (1,290) (2,942)
Proceeds from sale of property, plant
& equipment 139 903
Purchase of net assets of acquired companies
- net of cash received (170) (69,527)
Changes in other assets and deferred charges (4,369) 2,259
------------ -------------
Net cash used in investing activities (5,690) (69,307)
------------ -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings (payments) under line of credit (9,025) 59,753
Payments under capital lease obligation (198) (694)
Payments on long-term debt (1,508) (8,252)
Dividends paid (2,055) (1,848)
Changes in other liabilities (783) (223)
Proceeds from issuance of common stock 651 54,611
Common stock retired (156) (158)
------------ -------------
Net cash provided by (used in) financing
activities (13,074) 103,189
------------ -------------
Net increase in cash and cash equivalents 1,478 2,523
Cash and cash equivalents at beginning of period 672 767
------------ -------------
Cash and cash equivalents at end of period $ 2,150 $ 3,290
============ =============
Supplemental disclosures of non-cash
investing and financing activities:
Dividends accrued and unpaid $ 685 $ 657
Capital lease obligations incurred to
lease new equipment $ 50 $ 685
</TABLE>
THOMAS NELSON, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note A - Basis of Presentation
The accompanying unaudited consolidated financial statements
reflect all adjustments (which are of a normal recurring nature)
that are, in the opinion of management, necessary for a fair
statement of the results for the interim periods presented.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally
accepted accounting principles have been omitted pursuant to SEC
rules and regulations. The statements should be read in
conjunction with the Summary of Significant Accounting Policies
and notes to the consolidated financial statements included in the
Company's annual report for the year ended March 31, 1996.
The balance sheet and related information in these notes as of
March 31, 1996, have been taken from the audited consolidated
financial statements as of that date. Certain reclassifications
have been made to conform presentation of the fiscal 1996
Financial Statements with fiscal 1997 presentation.
Note B - Inventories
Components of inventories consisted of the following (in
thousands):
<TABLE>
<CAPTION>
December 31, March 31, December 31,
1996 1996 1995
----------- ----------- -----------
<S> <C> <C> <C>
Finished goods $ 55,450 $ 61,002 $ 62,742
Raw materials and
work in process 16,006 18,306 18,680
----------- ----------- -----------
$ 71,456 $ 79,308 $ 81,422
=========== =========== ===========
</TABLE>
Note C - Cash Dividend
On May 23, 1996, the Company's directors declared a cash
dividend of $.04 per share of Common and Class B Common Stock.
The dividend was paid August 9, 1996, to shareholders of record on
August 5, 1996.
On August 22, 1996, the Company's directors declared a cash
dividend of $.04 per share of Common and Class B Common Stock.
The dividend was paid November 18, 1996, to shareholders of record
on November 4, 1996.
On November 15, 1996, the Company's directors declared a cash
dividend of $.04 per share of Common and Class B Common Stock.
The dividend is payable February 17, 1997, to shareholders of
record on February 3, 1997.
Note D - Subsequent Event
On November 21, 1996, the Company, its wholly owned
subsidiary, Word, Incorporated, a Delaware corporation ("Word"),
and Word Direct Partners, L.P., a Texas limited partnership whose
sole general partner and sole limited partner are direct or
indirect wholly owned subsidiaries of the Company (collectively,
the "Sellers") entered into an Asset Purchase Agreement (together
with Amendment No. 1 thereto dated as of January 6, 1997, the
"Asset Purchase Agreement") among the Sellers and Gaylord
Entertainment Company, a Delaware corporation ("Gaylord"). The
Asset Purchase Agreement provided for the purchase by Gaylord of
certain assets of Sellers (the "Purchased Assets"), which
Purchased Assets comprised the music division of the Company (the
"Music Business") including the production of recorded music and
related products, the distribution of recordings for other
companies and music publishing, including songwriter development,
print music publishing and copyright administration. Gaylord also
agreed to assume certain liabilities associated with the Music
Business. In connection with the transactions contemplated by the
Asset Purchase Agreement, subsidiaries of Gaylord purchased
certain assets relating primarily to the Music Business of Word
Communications, Ltd., a Canadian corporation, and Nelson Word,
Ltd., a United Kingdom corporation, both of which are direct or
indirect wholly owned subsidiaries of the Company.
On January 6, 1997, the transactions contemplated by the
Asset Purchase Agreement were consummated. Pursuant to
adjustments contemplated by the Asset Purchase Agreement,
including a working capital adjustment based on changes in the
estimated balance sheet of the Music Business at the closing from
the balance sheet of the Music Business at June 30, 1996 to the
date of closing, Gaylord paid to Sellers $120,693,000 at the
closing. The purchase price is subject to further adjustment
based on a post-closing audit of the balance sheet of the Music
Business as of the closing date.
Pursuant to the Asset Purchase Agreement, Sellers entered
into an agreement with Gaylord whereby Sellers will provide, and
Gaylord will compensate them for, certain administrative support
services to the Music Business (such as billing, collection,
accounting, inventory warehousing and shipping) during a
transition period not to exceed twelve months following the
closing.
The proceeds received by the Company were used to retire $35
million of the Series A Senior Notes pursuant to the Company's
Note Purchase Agreement dated January 3, 1996, and to pay the
outstanding balance of approximately $50 million under the
Company's Amended and Restated Credit Agreement dated December 13,
1995, as amended, with the remainder of the proceeds to be
invested in short-term government securities or similar
investments pending application by the Company.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
OVERVIEW
The Company's net revenues have grown in recent years as a
result of increased sales of the existing product lines and
through the development and acquisition of new product lines. In
October 1995, the Company acquired The C. R. Gibson Company
("Gibson") for approximately $67 million in cash which expanded
its gift product lines and distribution network. As a result, the
Company's gift revenues have grown significantly for the first
nine months of fiscal 1997 as compared to the same period in the
prior year.
As a result of operating trends and the softness of the retail
markets for the Company's products which began to adversely affect
fiscal 1996 operating results in the second quarter of fiscal
1996, the Company decided during the fourth quarter of fiscal 1996
to discontinue the operations of its Royal Media division, a
division which published magazines and operated radio networks
directed toward Christian markets. The disposal of the Royal
Media division has been consummated. The operating results of the
Royal Media division for the three months and nine months ended
December 31, 1995, are reported as a loss from discontinued
operations.
On January 6, 1997, the Company consumated the sale of the
Music Business. The operating results of the Music Business for
the three months and nine months ended December 31, 1996 and 1995
are reported as if the transaction was consummated on April 1,
1995. The operating results of the Music Business for the three
months and nine months ended December 31, 1996, are reported as
income from discontinued operations and for the three months and
nine months ended December 31, 1995, are reported as a loss from
discontinued operations.
The following table sets forth for the periods indicated
certain selected statements of income data of the Company
expressed as a percentage of net revenues and the percentage
change in dollars in such data from the prior fiscal year.
<TABLE>
<CAPTION>
Nine Months Ended Fiscal Year-to-Year
December 31, Increase
------------------ (Decrease)
1996 1995
-------- -------- ----------
(%) (%) (%)
<S> <C> <C> <C>
Net revenues:
Publishing:
Book 34.7 34.1 (3.2)
Bible 27.8 45.6 (9.8)
------- -------
Total publishing 62.5 79.7 (7.0)
Gift 36.5 18.8 130.3
Other 1.0 1.5 (23.6)
------- -------
Total net revenues 100.0 100.0 18.6
------- -------
Expenses:
Cost of goods sold 53.8 52.9 20.5
Selling, general and
administrative 35.4 36.7 14.3
Amortization of goodwill
and non-compete
agreements 0.8 0.4 139.9
------- -------
Total expenses 90.0 90.0 18.5
------- -------
Operating income 10.0 10.0 19.0
Income from continuing
operations before income
taxes 6.3 6.3 19.8
Income (loss) from discontinued
operations, net of taxes 0.4 (0.9) --
Net income 4.3 3.1 68.2
</TABLE>
The Company's net revenues fluctuate seasonally, with net
revenues in the first fiscal quarter being lower than those for
the remainder of the year. This seasonality is the result of
increased consumer purchases of the Company's products during the
traditional holiday periods. Due to this seasonality, the Company
has historically incurred a loss during the first quarter of each
fiscal year. In addition, the Company's quarterly operating
results may fluctuate significantly due to the seasonality of new
product introductions, the timing of selling and marketing
expenses and changes in sales and product mixes.
The following discussion includes certain forward-looking
statements. Actual results could differ materially from those
reflected by the forward-looking statements and a number of
factors may affect future results, liquidity and capital
resources. These factors include softness in the general retail
environment, the timing of products being introduced to the
market, the level of returns experienced by operating divisions,
the level of margins achievable in the marketplace and the ability
to minimize operating expenses. Although the Company believes it
has the business strategy and resources needed for improved
operations, future revenue and margin trends cannot be reliably
predicted and may cause the Company to adjust its business
strategy during the remainder of fiscal 1997.
Results of Operations
Net revenues for the first nine months of fiscal 1997 increased
by $28.8 million, or 18.6%, over the same period in fiscal 1996.
Net revenues decreased in each of the Company's product lines,
except gift, as follows: Bible products decreased by $1.7 million,
or 3.2%, and book products decreased by $6.9 million, or 9.8%. Net
revenues from gift products, including Gibson, increased by $38.0
million, or 130.3%. Net revenues for the third quarter of fiscal
1997 increased by $0.6 million, or 0.9%, over the same period in
fiscal 1996. Net revenues from gift products, including Gibson,
increased by $1.8 million, or 10.5%. The remaining product lines
of books and Bibles decreased by $0.2 million, or 1.0%, and $0.6
million, or 2.8%, respectively. Price increases did not have a
material effect on net revenues. The increases in net revenues
for the first nine months and third quarter were primarily
attributable to the increases in revenues in the gift products
division due to the acquisition of Gibson, which was consummated
on October 31, 1995.
The Company's cost of goods sold for the first nine months of
fiscal 1997 increased by $16.8 million, or 20.5%, over the same
period in fiscal 1996 and, as a percentage of net revenues,
increased to 53.8% for the first nine months of fiscal 1997 from
52.9% in the comparable period in fiscal 1996. Cost of goods sold
for the third fiscal quarter increased by $0.9 million, or 2.6%,
over the same period in fiscal 1996 and, as a percentage of net
revenues, increased from 55.1% to 56.0%. The increase of cost of
goods sold, as a percentage of net revenues, for the first nine
months and third quarter resulted from a change in the mix of
distribution channels. Sales through the gift market channels
increased over the prior year as a result of the Gibson
acquisition. The gift division's products have a higher cost of
sales as a percentage of net revenues since they are sold
nonreturnable and lower gross margins than publishing products are
acceptable. Therefore, as gift sales increased as a percentage
of the Company's revenues, cost of sales as a percentage of
net revenues increased for the third quarter and first nine months
of fiscal 1997 over the same periods in fiscal 1996. In addition
to the mix of products, cost of goods sold increased because the
Company has focused on reducing inventories and has made selected
sales of publishing products at lower margins to reduce slow
moving products.
Selling, general and administrative expenses for the first nine
months of fiscal 1997 increased by $8.2 million, or 14.3%, and
decreased for the third quarter by $2.5 million, or 11.3%, from the
same periods in fiscal 1996. These expenses, expressed as a
percentage of net revenues, decreased to 35.4% for the first nine
months of fiscal 1997 from 36.7% and to 30.9% for the third fiscal
quarter from 35.1% in the same periods in fiscal 1996 primarily
due to the reductions in staff and general expenditures, including
reductions in the Company's publishing direct marketing to
consumers program.
Interest expense for the first nine months of fiscal 1997
increased by $1.0 million, or 16.3%, over the same period in fiscal
1996 due to increased borrowings for the October 1995 acquisition
of Gibson. Interest expense for the third quarter of 1997
decreased by $0.2 million, or 7.0%, from the same period in fiscal
1996 due to decreased borrowings for working capital.
Liquidity and Capital Resources
The primary sources of liquidity to meet the Company's future
obligations and working capital needs are cash generated from
operations and borrowings available under bank credit facilities.
At December 31, 1996, the Company had working capital of $194.1
million. At December 31, 1996, the Company had $49.2 million
outstanding, and $85.8 million available for borrowing under its
two credit facilities. Seasonality has a major impact on the
Company's revenues which in turn have a direct bearing on the
level of borrowings. Subsequent to the sale of the Music Business
on January 6, 1997, the entire outstanding borrowing under the
credit facilities was repaid (See Note D-Subsequent Event).
Net cash provided by (used in) operating activities was $20.2
million and ($31.4) million for the first nine months of fiscal
1997 and 1996, respectively. Cash provided by operations during
the first nine months of fiscal 1997 was principally attributable
to the decrease in inventories and income from continuing
operations. Cash used in operations during the first nine months
of fiscal 1996 was principally attributable to the cash used in
discontinued operations and to the increase in inventories.
During the first nine months of fiscal 1997, capital
expenditures totaled approximately $1.3 million, which was used
primarily to purchase computer equipment and warehousing and
manufacturing equipment. During the remainder of fiscal 1997, the
Company anticipates capital expenditures of approximately $1.0
million primarily consisting of computer equipment, warehousing
and manufacturing equipment and building improvements.
In connection with the sale of the Company's Music Business on
January 7, 1997, the Company's $125 million credit facility was
amended to decrease the facility to $75 million. The $75 million
credit facility and the Company's $10 million credit facility
(collectively, the "Credit Agreements") are both unsecured. The
$75 million credit facility bears interest at either the prime
rate or, at the Company's option, LIBOR plus a percentage, subject
to adjustment based on certain financial ratios and matures on
December 13, 2002. The $10 million credit facility bears interest
at the prime rate and matures on July 31, 1998. Due to the
seasonality of the Company's business, borrowings under the Credit
Agreements typically peak during the third quarter of the fiscal
year.
At December 31, 1996, the Company had outstanding $61 million
of unsecured senior notes ("Senior Notes"). The Senior Notes bear
interest at rates from 6.93% to 9.5% due through fiscal 2008.
Subsequent to the sale of the Music Business, $35 million of the
Senior Notes was retired.
Under the terms of the Credit Agreements and the Senior Notes,
the Company has agreed to limit the payment of dividends and to
maintain certain interest coverage and debt-to-capital ratios
which are similarly calculated for each debt agreement. At
December 31, 1996, the Company was in compliance with all
covenants of these debt agreements, as amended.
The Company also has outstanding $55 million of 5.75%
convertible subordinated notes ("Convertible Subordinated Notes")
due November 30, 1999. The Convertible Subordinated Notes
presently are convertible into common stock at $17.00 per share
and are redeemable at the Company's option after November 30,
1995, at 103.29% of the principal amount, declining annually
thereafter to 100% on November 30, 1999.
Management believes cash reserves from the sale of the Music
Business, cash generated by operations and borrowings available
through its Credit Agreements, will be sufficient to fund antici-
pated working capital requirements for existing operations
through the remainder of fiscal 1997.
PART II
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits required by Item 601 of Regulation S-K
Exhibit 4.1- Second Amendment to Credit Agreement
dated November 15, 1996, among Thomas Nelson,
Inc., SunTrust Bank, Nashville, N.A., National
City Bank of Louisville, First American
National Bank in Nashville, NationsBank of
Texas, N.A. in Dallas, Creditanstalt-Bankverein
in New York (filed as Exhibit 4.1 to the
Company's Report on Form 8-K dated January 6,
1997 and incorporated herein by reference).
Exhibit 11 - Statement of Re-Computation of Per Share
Earnings
Exhibit 27 - Financial Data Schedule
(b) No Form 8-K was filed by the Company during the quarter
ended December 31, 1996.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Company has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
Thomas Nelson, Inc.
(Registrant)
February 14, 1997 BY /s/ Joe L. Powers
- - -------------------------- -----------------------
Joe L. Powers
Executive Vice President
(Principal Financial and
Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Company's 10-Q for the period ended December 31, 1996, and is qualified
in its entirety by reference to such financial statements and the notes thereto.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-START> APR-01-1996
<PERIOD-END> DEC-31-1996
<CASH> 2,150
<SECURITIES> 0
<RECEIVABLES> 75,071
<ALLOWANCES> 7,516
<INVENTORY> 71,456
<CURRENT-ASSETS> 236,886
<PP&E> 47,249
<DEPRECIATION> 13,941
<TOTAL-ASSETS> 344,614
<CURRENT-LIABILITIES> 42,777
<BONDS> 168,588
0
0
<COMMON> 17,116
<OTHER-SE> 111,913
<TOTAL-LIABILITY-AND-EQUITY> 344,614
<SALES> 176,798
<TOTAL-REVENUES> 183,942
<CGS> 98,977
<TOTAL-COSTS> 164,084
<OTHER-EXPENSES> 1,485
<LOSS-PROVISION> 1,396
<INTEREST-EXPENSE> 7,021
<INCOME-PRETAX> 11,664
<INCOME-TAX> 4,432
<INCOME-CONTINUING> 7,232
<DISCONTINUED> 728
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 7,960
<EPS-PRIMARY> 0.46
<EPS-DILUTED> 0.46
</TABLE>
<TABLE>
EXHIBIT 11
STATEMENT RE-COMPUTATION OF PER SHARE EARNINGS
(Dollars in thousands, except per share data)
<CAPTION>
Nine Months Ended Three Months Ended
December 31, December 31,
1996 1995 1996 1995
---------- --------- --------- ---------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Primary Earnings Per Share:
Weighted average shares
outstanding 17,138 15,310 17,136 16,484
========== ========= ========= =========
Income from continuing
operations $ 7,232 $ 6,138 $ 3,443 $ 2,181
Income (Loss) from
discontinued operations 728 (1,406) 803 (535)
---------- --------- --------- ---------
Net Income $ 7,960 $ 4,732 $ 4,246 $ 1,646
========== ========= ========= =========
Income Per Share from
continuing operations $ 0.42 $ 0.40 $ 0.20 $ 0.13
Income (Loss) Per Share from
discontinued operations 0.04 (0.09) 0.05 (0.03)
---------- --------- --------- ---------
Net Income Per Share $ 0.46 $ 0.31 $ 0.25 $ 0.10
========== ========= ========= =========
Fully-diluted Earnings
Per Share:
Weighted average shares
outstanding 17,138 15,310 17,136 16,484
Convertible Notes 3,235 3,235 3,235 3,235
---------- --------- --------- ---------
Total Shares 20,373 18,545 20,371 19,719
========== ========= ========= =========
Income from continuing
operations(1) $ 8,815 $ 7,725 $ 3,971 $ 2,710
Income (Loss) from discon-
tinued operations 728 (1,406) 803 (535)
---------- --------- --------- ---------
Net Income $ 9,543 $ 6,319 $ 4,774 $ 2,175
========== ========= ========= =========
Income Per Share from
continuing operations $ 0.42 $ 0.40 $ 0.19 $ 0.13
Income (Loss) Per Share from
discontinued operations 0.04 (0.09) 0.04 (0.03)
---------- --------- --------- ---------
Net Income Per Share $ 0.46 (2) $ 0.31 (2) $ 0.23 $ 0.10(2)
========== ========= ========= =========
(1) Adjusted for interest on convertible debt
(2) Anti-dilutive; use primary earnings per share
</TABLE>
