<PAGE> 1
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 May 3, 1997
-----------
( ) 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 0-12202
-------
TRAK AUTO CORPORATION
------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 52-1281465
- --------------------------------------------- -------------------
(State or other jurisdiction of incorporation (I.R.S. Employer
or organization) Identification No.)
3300 75TH AVENUE, LANDOVER, MARYLAND, 20785
-------------------------------------------
(Address of principal executive office)
(Zip Code)
(301) 226-1200
----------------------------------------------------
(Registrant's telephone number, including area code)
----------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
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 June 13, 1997, the registrant had 5,909,279 shares of Common Stock, $.01 par
value per share, outstanding.
1
<PAGE> 2
PART I
Item 1. Financial Statements
Certain consolidated financial statements included herein have been prepared by
Trak Auto Corporation ("Trak Auto"), without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been condensed or
omitted pursuant to such rules and regulations, although Trak Auto believes that
the disclosures are adequate to make the information presented not misleading.
It is suggested that these consolidated financial statements be read in
conjunction with the consolidated financial statements and notes thereto
included in Trak Auto's annual report on Form 10-K for the fiscal year ended
February 1, 1997.
2
<PAGE> 3
TRAK AUTO CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(dollars in thousands)
<TABLE>
<CAPTION>
Thirteen Weeks Ended
--------------------
May 3, May 4,
1997 1996
-------- --------
<S> <C> <C>
Sales $ 81,605 $ 87,016
Interest and other income 153 410
-------- --------
81,758 87,426
-------- --------
Expenses:
Cost of sales, store occupancy and
warehousing 62,265 64,989
Selling and administrative 17,467 17,769
Depreciation and amortization 2,059 1,896
Interest expense 923 921
-------- --------
82,714 85,575
-------- --------
Income (loss) before income taxes (956) 1,851
Income taxes (benefit) (258) 671
-------- --------
Net income (loss) $ (698) $ 1,180
======== ========
Weighted average common shares and
common share equivalents outstanding 5,909 5,938
======== ========
Net income (loss) per share $ (.12) $ .20
======== ========
</TABLE>
The accompanying notes are an integral part of these statements.
3
<PAGE> 4
TRAK AUTO CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
<TABLE>
<CAPTION>
(Unaudited) (Audited)
May 3, February 1,
ASSETS 1997 1997
-------- --------
<S> <C> <C>
Current Assets:
Cash $ 6,063 $ 5,782
Short-term instruments 8,556 5,941
Marketable debt securities 1,297 2,479
Accounts receivable 5,633 6,841
Merchandise inventories 109,172 106,193
Deferred income taxes 6,630 6,494
Other current assets 3,156 3,083
-------- --------
Total Current Assets 140,507 136,813
-------- --------
Property and Equipment, at cost:
Furniture, fixtures and equipment 64,293 63,675
Leasehold improvements 12,172 12,103
Property under capital leases 22,032 22,032
-------- --------
98,497 97,810
Accumulated Depreciation
and Amortization 51,973 49,876
-------- --------
46,524 47,934
-------- --------
Other Assets 1,436 1,502
-------- --------
Deferred Income Taxes 6,093 5,971
-------- --------
Total Assets $194,560 $192,220
======== ========
</TABLE>
The accompanying notes are an integral part of these balance sheets.
4
<PAGE> 5
TRAK AUTO CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
<TABLE>
<CAPTION>
(Unaudited) (Audited)
May 3, February 1,
LIABILITIES AND STOCKHOLDERS' EQUITY 1997 1997
-------- --------
<S> <C> <C>
Current Liabilities:
Accounts payable, trade $ 51,301 $ 47,690
Income taxes payable 1,429 1,581
Accrued expenses -
Salary and benefits 12,576 11,440
Taxes other than income 6,145 5,569
Other 11,725 13,791
Current portion of obligations under
capital leases 209 209
Due to affiliate 145 18
-------- --------
Total Current Liabilities 83,530 80,298
-------- --------
Obligations Under Capital Leases 26,948 26,912
-------- --------
Reserve for Closed Stores and
Restructuring 1,370 1,597
-------- --------
Total Liabilities 111,848 108,807
-------- --------
Stockholders' Equity:
Common stock, par value $.01 per
share; 15,000,000 shares authorized;
6,437,469 shares issued 64 64
Paid-in capital 46,476 46,476
Unrealized investment gains - 3
Retained earnings 44,892 45,590
Treasury stock, 528,190 shares
of common stock, at cost (8,720) (8,720)
-------- --------
Total Stockholders' Equity 82,712 83,413
-------- --------
Total Liabilities and Stockholders'
Equity $194,560 $192,220
======== ========
</TABLE>
The accompanying notes are an integral part of these balance sheets.
5
<PAGE> 6
TRAK AUTO CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS, (Unaudited)
(dollars in thousands)
<TABLE>
<CAPTION>
Thirteen Weeks Ended
--------------------
May 3, May 4,
1997 1996
-------- --------
<S> <C> <C>
Cash Flows from Operating Activities:
Net income (loss) $ (698) $ 1,180
Adjustments to reconcile net income (loss)
to net cash provided by operating activities:
Depreciation and amortization 2,059 1,896
Provision for closed store 66 -
Interest in excess of capital lease payments 88 67
Change in assets and liabilities:
Accounts receivable 1,208 (458)
Merchandise inventories (2,979) (7,934)
Due from affiliate - (61)
Other current assets (73) (2,374)
Deferred income taxes (229) (504)
Other assets 66 72
Accounts payable, trade 3,611 5,550
Accrued expenses (354) 3,721
Due to affiliate 127 (88)
Income taxes payable (152) 1,030
Reserve for closed stores (293) (699)
-------- --------
Net cash provided by operating activities $ 2,447 $ 1,398
-------- --------
Cash Flows from Investing Activities:
Capital expenditures $ (649) $ (3,184)
Maturities of United States Treasury Notes 1,150 -
-------- --------
Net cash provided by (used for) investing
activities $ 501 $ (3,184)
-------- --------
Cash Flows from Financing Activities:
Principal payments under capital
lease obligations $ (52) $ (25)
Proceeds from exercise of stock options - 77
-------- --------
Net cash provided by (used for)
financing activities $ (52) $ 52
-------- --------
</TABLE>
(Continued on next page)
6
<PAGE> 7
TRAK AUTO CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS, (Unaudited), Continued
(dollars in thousands)
<TABLE>
<CAPTION>
Thirteen Weeks Ended
--------------------
May 3, May 4,
1997 1996
-------- --------
<S> <C> <C>
Net Increase (Decrease) in Cash and Equivalents $ 2,896 $ (1,734)
Cash and Equivalents at Beginning of Period 11,723 13,559
-------- --------
Cash and Equivalents at End of Period $ 14,619 $ 11,825
======== ========
Supplemental Disclosures of Cash Flow Information:
Cash paid during quarter for:
Interest $ 923 $ 921
Income taxes - 260
</TABLE>
The accompanying notes are an integral part of these statements.
7
<PAGE> 8
TRAK AUTO CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
May 3, 1997 and May 4, 1996
(Unaudited)
NOTE 1 - GENERAL
The accompanying consolidated financial statements reflect the accounts of Trak
Auto Corporation ("Trak Auto") and its wholly-owned subsidiaries. Trak Auto and
its wholly-owned subsidiaries are referred to collectively as the "Company".
All significant intercompany accounts and transactions have been eliminated.
The Company is engaged in the business of operating specialty retail stores in
the United States. The unaudited statements as of May 3, 1997 and May 4, 1996
reflect, in the opinion of management, all adjustments (normal and recurring in
nature) necessary to present fairly the consolidated financial position as of
May 3, 1997 and May 4, 1996 and the results of operations and cash flows for the
periods indicated.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities as of the date of the
financial statements, and the reported amounts of revenues and expenses during
the reporting period. Accordingly, actual results could differ from those
estimates.
The results of operations for the quarter ended May 3, 1997 are not necessarily
indicative of the results to be achieved for the full fiscal year.
NOTE 2 - EARNINGS PER SHARE
Earnings per share is computed using the weighted average number of shares of
common stock and common stock equivalents (certain stock options) outstanding
during the periods. The difference between primary net income (loss) per common
share and fully diluted net income (loss) per common share is not significant
for the periods presented.
NOTE 3 - INTERIM INVENTORY ESTIMATES
The Company's inventories are priced at the lower of last-in, first-out cost or
market. At May 3, 1997 and February 1, 1997, inventories determined on a
first-in, first-out basis would have been greater by $6,808,000 and $6,733,000,
respectively.
The Company takes a physical count of its store inventories semiannually and
the Company uses a gross profit method combined with available perpetual
inventory information to determine inventories for quarters when complete
physical counts are not taken. The Company did not take a physical inventory
for the quarter ended May 3, 1997.
8
<PAGE> 9
TRAK AUTO CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued
May 3, 1997 and May 4, 1996
(Unaudited)
NOTE 4 - SHORT-TERM INSTRUMENTS AND MARKETABLE DEBT SECURITIES
The Company's short-term instruments included United States Treasury Bills, with
a maturity of three months or less, and money market funds. Marketable debt
securities included United States Treasury Bills with a maturity of greater than
three months, United States Treasury Notes, United States Agency Securities and
municipal securities.
Management determines the appropriate classification of its investments in debt
securities at the time of purchase and reevaluates such determination at each
balance sheet date. Debt securities for which the Company does not have the
intent or ability to hold to maturity are classified as available-for-sale.
Securities available-for-sale are carried at fair value, with the unrealized
gains and losses, net of tax, reported as a separate component of stockholders'
equity. At May 3, 1997, market value was approximately equal to cost and the
Company had no investments that qualified as trading or held-to-maturity.
The amortized cost of debt securities classified as available-for-sale is
adjusted for amortization of premiums and accretion of discounts to maturity.
Such amortization and interest are included in interest income. Realized gains
and losses are included in interest and other income. The cost of securities
sold is based on the specific identification method.
NOTE 5 - CREDIT AGREEMENTS
In December 1996, the Company entered into a revolving credit facility (the
"Facility") with a finance company to borrow up to $25.0 million. The Company
intends to use proceeds from drawdowns under the Facility for working capital
and other corporate purposes. The Facility has an original term of three
years. Borrowings under the Facility bear interest at rates ranging from prime
rate minus 0.50% to prime rate plus 0.25%, for prime rate loans, and LIBOR plus
1.5% to LIBOR plus 2.25%, for LIBOR loans. Interest rates are based upon the
Company's ratio of debt to tangible net worth. Borrowings are limited to
eligible inventory levels, as defined, and are secured by the Company's
inventory, accounts receivable, and proceeds from the sale of such assets. The
Facility contains certain restrictive covenants including limitations on
additional indebtedness, advances to affiliates and payments (limited to $25.0
million) or guarantees (limited to $20.0 million of the $25.0 million) to settle
disputes with Haft family members and a maximum leverage ratio covenant.
Interest on prime rate loans is payable monthly. Interest and principal on
LIBOR loans is payable between one and six months from the borrowing date.
LIBOR loans are subject to a prepayment penalty and may be continued for a
9
<PAGE> 10
TRAK AUTO CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued
May 3, 1997 and May 4, 1996
(Unaudited)
subsequent one to six month period. LIBOR loans may be converted to prime rate
loans and visa versa. The Facility includes a facility fee of .25% on the
unused principal balance, as defined. No single advance may be outstanding for
more than 36 months. The Company may terminate the Facility upon 60-days prior
written notice to the lender and the lender may terminate it as of December 18,
1999 or on any anniversary date thereafter upon 60-days prior written notice to
the Company.
In addition, the Company has a $750,000 commercial letter of credit facility for
use in importing merchandise.
At May 3, 1997, there were no borrowings under these credit agreements.
NOTE 6 - PROPERTY, EQUIPMENT AND DEPRECIATION
Effective February 2, 1997 the Company changed its accounting policy from
expensing purchased computer software costs in the year of acquisition to
capitalizing and depreciating these costs over the estimated useful life not to
exceed five years. Management has determined that these costs benefit future
periods.
The Company did not place any new computer software into service during the 13
weeks ended May 3, 1997. Accordingly, there has been no effect of the change
in accounting policy as of May 3, 1997.
10
<PAGE> 11
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Outlook
Except for historical information, statements in this Management's Discussion
and Analysis of Financial Condition and Results of Operations are forward-
looking. Actual results may differ materially due to a variety of factors,
including the results of ongoing litigation (or settlement of litigation), the
Company's ability to effectively compete in the automotive aftermarket industry,
the effect of national and regional economic conditions, and the availability
of capital to fund operations. The Company undertakes no obligation and does not
intend to update, revise or otherwise publicly release the result of any
revisions to these forward-looking statements that may be made to reflect future
events or circumstances.
The Company believes that its superstore concept presents significant growth
opportunities and intends to open new Super Trak and Super Trak Warehouse stores
in existing and possibly new markets. In the past, these superstores have
generated higher sales at locations converted from Classic Trak stores as well
as higher gross margins as a result of a change in product mix (increased hard
parts). The Company believes that as superstores mature, operating expenses as
a percentage of sales will decrease.
The Company intends to continue its practice of reviewing the profitability
trends and prospects of existing stores. The Company may from time to time
close, relocate or sell stores (or groups of stores) that are not satisfying
certain performance objectives.
The automotive aftermarket is a highly competitive market place. As a result,
the industry is consolidating with independent operators and small chains either
going out of business or being acquired by larger competitors. Additionally,
the do-it-yourself customer base is shrinking due to the increased complexity
of automobiles, increased incidences of leasing, and the availability of well-
maintained leased vehicles entering the used car market. Management believes
that the markets in which it operates will remain highly competitive in the
foreseeable future and, as a result, that the Company will be challenged to
improve operating results in fiscal 1998.
Liquidity and Capital Resources
Cash, including short-term instruments, is the Company's primary source of
liquidity. Cash, including short-term instruments, increased by $2,896,000 to
$14,619,000 at May 3, 1997 from $11,723,000 at February 1, 1997. This increase
was due primarily to cash generated by operations and the maturity of marketable
debt securities.
Operating activities provided $2,447,000 to the Company during the 13 weeks
ended May 3, 1997 compared to providing $1,398,000 of the Company's funds during
11
<PAGE> 12
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations, Continued
the 13 weeks ended May 4, 1996. The increase was primarily due to a smaller
increase in merchandise inventory levels for the comparable period. Current
period operations and the timing of the collection of outstanding accounts
receivable provided the cash during the 13 weeks ended May 3, 1997.
Investing activities provided $501,000 to the Company during the 13 weeks ended
May 3, 1997 compared to using $3,184,000 of the Company's funds for the 13 weeks
May 4, 1996. Capital expenditures decreased from $3,184,000 last year to
$649,000 this year due to capital expenditures for the Pittsburgh stores one
year ago. During the 13 weeks ended May 3, 1997, $1,150,000 of United States
Treasury Notes matured.
Financing activities used $52,000 of the Company's cash for principal payments
under capital lease obligations.
In December 1996, the Company entered into a revolving credit facility with a
finance company to borrow up to $25.0 million. The credit facility has an
original term of three years. Borrowings are limited to eligible inventory
levels and are secured by the Company's inventory, accounts receivable and
proceeds from the sale of those assets. The credit facility contains certain
restrictive covenants and a maximum leverage ratio covenant. The covenants
include a limitation of $25.0 million on amounts paid (including a $20.0 million
limitation on amounts guaranteed) to settle disputes with Haft family members.
As of May 3, 1997, the Company had not borrowed under the credit facility.
The Company funds its requirements for working capital and capital expenditures
with net cash generated from operations, existing cash resources and, if
necessary, borrowings under its credit facility. The Company's primary capital
requirements relate to remodelings and new store openings (including purchases
of inventory and the costs of store fixtures and leasehold improvements). As
of May 3, 1997, the Company had entered into lease agreements to open seven new
stores and an amendment to an existing lease to convert from a Classic Trak
stores to a Super Trak or Super Trak Warehouse store.
Funding of Possible Settlements
Dart has reached a conditional settlement agreement in principle with Herbert
H. Haft and is currently negotiating a possible settlement collectively with
Robert M. Haft, Linda G. Haft and Gloria G. Haft as well as a possible
supplemental settlement agreement with Ronald S. Haft. The aggregate payments
estimated to be paid by Dart and its subsidiaries in connection with these
possible settlements is approximately $90 million (including a loan of $10
million), part of which would be deferred. It is anticipated that Dart would
pay substantially all of this amount, though a portion (yet to be determined)
could be allocated to Crown Books Corporation ("Crown Books"), an affiliate of
Dart and to Trak Auto. Allocation of any actual settlement obligations among
12
<PAGE> 13
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations, Continued
the companies would be in proportion to reflect relative benefits each company
receives, as determined by their boards of directors after consultation with
outside advisors.
Dart and its subsidiaries do not presently have cash available to pay the
approximately $90 million contemplated by the possible settlements, but are
considering various options to finance them, if they occur. Dart may use the
existing cash ($41.3 million at May 3, 1997) of Shoppers Food Warehouse Corp.
("Shoppers"), a wholly owned subsidiary, and proceeds from new debt financing
by Shoppers. However, there can be no assurance that Dart would obtain any such
financing or as to the terms of any financing, if it is obtained. Trak Auto and
Crown Books anticipate that they would pay their portion of the settlement
obligations from borrowings under their respective credit facilities.
Results of Operations
During the 13 weeks ended May 3, 1997, the Company opened one new Super Trak
store and one new Super Trak Warehouse store and closed or converted one classic
Trak store. At May 3, 1997, the Company had 287 stores, including 123 Super
Trak stores and 45 Super Trak Warehouse stores.
Sales of $81,605,000 during the 13 weeks ended May 3, 1997 decreased by
$5,411,000 or 6.2% over the 13 weeks ended May 4, 1996. The decrease was due
to the mild winter conditions in the Midwest and East coast markets as well as
the continued poor economic and highly competitive environment of the Los
Angeles market. Comparable sales (stores open more than one year) decreased
10.1% for the 13 weeks ended May 3, 1997. Sales for comparable Super Trak and
Super Trak Warehouse stores decreased 9.6% and sales for comparable classic
Trak stores decreased 10.9%. Sales for Super Trak and Super Trak Warehouse
stores represented 68.1% of total sales during the 13 weeks ended May 3, 1997
compared to 62.8% for the 13 weeks ended May 4, 1996.
Interest and other income decreased by $257,000 when compared to the prior year,
largely due to reduced interest income as a result of less funds available for
short-term investment.
Cost of sales, store occupancy and warehousing expenses as a percentage of sales
were 76.3% for the 13 weeks ended May 3, 1997 compared to 74.7% for the same
period in the prior year. The increase was primarily due to increased occupancy
and distribution costs, as a percentage of sales, due to the decrease in sales
while actual occupancy and distribution cost remained unchanged and was
partially offset by an increase in gross margin.
Selling and administrative expenses were 21.4% and 20.4% as a percentage of
sales for the 13 weeks ended May 3, 1997 and May 4, 1996, respectively. The
increase was due primarily to increased payroll costs, as a percentage of sales,
13
<PAGE> 14
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations, Continued
due to the decrease in sales. Actual payroll costs were approximately the same
as last year.
Depreciation and amortization expenses increased $163,000 for the 13 weeks ended
May 3, 1997 compared to the same period one year ago. The increase was due to
an increase in store fixed assets resulting from the opening of Super Trak and
Super Trak Warehouse stores.
Interest expense of approximately $920,000 during the 13 weeks ended May 3, 1997
and May 4, 1996 was for interest under capital lease obligations.
The effective income tax rate was 27.0% for the income tax benefit during the
13 weeks ended May 3, 1997 compared to 36.3% for income taxes during the 13
weeks ended May 4, 1996. The decrease in the effective rate was primarily due
to reduced taxable income while a permanent difference remained relatively
unchanged.
14
<PAGE> 15
PART II
Item 1. Legal Proceedings
Material legal proceedings pending against Trak Auto are described in its Annual
Report on Form 10-K for the year ended February 1, 1997 (the "Annual Report").
There have been no material developments in any legal proceedings reported in
the Annual Report.
Item 6. Exhibits and Reports on Form 8-K
(A) Exhibits
18(a) Letter from Trak Auto's independent accountants
regarding a change in accounting principle or practice.
27 Financial Data Schedule
(B) Reports on Form 8-K
None
15
<PAGE> 16
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.
TRAK AUTO CORPORATION
Date: June 16, 1997 By: R. KEITH GREEN
---------------------- ---------------------------
R. KEITH GREEN
President
Date: June 16, 1997 By: DAVID B. MACGLASHAN
---------------------- ---------------------------
DAVID B. MACGLASHAN
Senior Vice President and
Chief Financial Officer
16
<PAGE> 1
Exhibit 18(a)
June 16, 1997
Trak Auto
3300 75th Avenue
Landover, Maryland 20785
RE: Form 10-Q Report for the quarter ended May 3, 1997
Ladies and Gentlemen:
This letter is written to meet the requirements of Regulation S-K calling for
a letter from a registrant's independent accountants whenever there has been a
change in accounting principle or practice.
We have been informed that, as of February 2, 1997, the Company changed from the
expense method of accounting for purchased software costs to the capitalization
method. According to the management of the Company, this change was made to
reflect the fact that these assets provide probable future benefits and
contribute to future net cash flows.
A complete coordinated set of financial and reporting standards for determining
the preferability of accounting principles among acceptable alternative
principles has not been established by the accounting profession. Thus, we
cannot make an objective determination of whether the change in accounting
described in the preceding paragraph is to a preferable method. However, we
have reviewed the pertinent factors, including those related to financial
reporting, in this particular case on a subjective basis, and our opinion stated
below is based on our determination made in this manner.
We are of the opinion that the Company's change in method of accounting is to
an acceptable alternative method of accounting, which, based upon the reasons
stated for the change and our discussions with you, is also preferable under the
circumstances in this particular case. In arriving at this opinion, we have
relied on the business judgment and business planning of your management.
We have not audited the application of this change to the financial statements
of any period subsequent to February 1, 1997. Further, we have not examined and
do not express any opinion with respect to your financial statements for the
three months ended May 3, 1997.
Very truly yours,
ARTHUR ANDERSEN LLP
17
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-31-1998
<PERIOD-START> FEB-02-1997
<PERIOD-END> MAY-03-1997
<CASH> 14,619
<SECURITIES> 1,297
<RECEIVABLES> 5,633
<ALLOWANCES> 0
<INVENTORY> 109,172
<CURRENT-ASSETS> 140,507
<PP&E> 98,497
<DEPRECIATION> 51,973
<TOTAL-ASSETS> 194,560
<CURRENT-LIABILITIES> 83,530
<BONDS> 26,948
0
0
<COMMON> 64
<OTHER-SE> 82,648
<TOTAL-LIABILITY-AND-EQUITY> 194,560
<SALES> 81,605
<TOTAL-REVENUES> 81,758
<CGS> 62,265
<TOTAL-COSTS> 62,265
<OTHER-EXPENSES> 19,526
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 923
<INCOME-PRETAX> (956)
<INCOME-TAX> (258)
<INCOME-CONTINUING> (698)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (698)
<EPS-PRIMARY> (.12)
<EPS-DILUTED> (.12)
</TABLE>
