FORM 10-Q
SECURITIES & EXCHANGE COMMISSION
Washington, D.C. 20549
(MARK ONE)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended April 1, 1995
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period From ... to ...
Commission File No. 1-8739
Burlington Coat Factory Warehouse Corporation
________________________________________________
(Exact name of registrant as specified in its charter)
Delaware 22-1970303
- ------------------------------ -------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
1830 Route 130 North
Burlington, New Jersey 08016
- ------------------------------ -------------------------------
(Address of principal executive (Zip Code)
offices)
Registrant's telephone number, including area code (609)387-7800
Indicate by check mark whether the
Registrant (1) has filed all reports
required 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
Indicate the number of shares outstanding
of each of the issuer's classes of common
stock, as of the latest practicable date.
Class Outstanding at May 9, 1995
- -------------------------- --------------------------------
Common stock, par value $1 41,132,665
Page 1 of 14<PAGE>
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION
AND SUBSIDIARIES
I N D E X
Page
Part I - Financial Information:
Item 1. Financial Statements:
Condensed consolidated balance sheets - April 1, 1995 3
(unaudited), July 2, 1994 and April 2, 1994 (unaudited)
Condensed consolidated statements of operations - Nine and 4
three months ended April 1, 1995 and April 2, 1994
(unaudited)
Condensed consolidated statements of cash flows - nine 5
months ended April 1, 1995 and April 2, 1994
(unaudited)
Notes to condensed consolidated financial statements 6
Item 2. Management's discussion and analysis of results 7 -12
of operations and financial condition
Part II - Other Information:
Item 1. Legal Proceedings 13
Item 6. Exhibits and reports on Form 8-K 13
SIGNATURES 14
* * * * * * * * * * * *
Page 2 of 14<PAGE>
<TABLE>
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
<CAPTION> (All amounts in thousands)
April 01, April 02,
1995 July 02, 1994
(Unaudited) 1994 (Unaudited)
----------- -------- -----------
ASSETS
- ------
<S> <C> <C> <C>
Current Assets:
Cash and Cash Equivalents $ 24,219 $ 21,236 $ 62,752
Short-Term Investments -- -- 28,194
Accounts Receivable 15,618 13,915 15,393
Merchandise Inventories 529,294 468,921 424,070
Deferred Tax Asset 8,844 6,782 5,133
Prepaid and Other Current Assets 8,143 17,968 2,592
------- ------- -------
Total Current Assets 586,118 528,822 538,134
Property and Equipment Net of Accumulated
Depreciation and Amortization 218,170 184,590 173,829
Other Assets 14,462 12,027 11,293
------- ------- -------
Total Assets $ 818,750 $ 725,439 $ 723,256
========= ========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
Current Liabilities:
Accounts Payable $ 193,598 $ 133,706 $ 164,976
Notes Payable 51,800 65,020 --
Income Taxes Payable 8,695 454 13,010
Other Current Liabilities 62,186 50,998 61,097
Current Maturities of Long Term Debt 64 54 58
--------- --------- ---------
Total Current Liabilities 316,343 250,232 239,141
Long Term Debt 91,315 91,369 91,379
Other Liabilities 7,778 7,151 6,763
Deferred Tax Liability 7,101 6,830 6,321
Stockholders' Equity:
Net Unrealized Loss on Noncurrent Marketable
Equity Securities (20) (20) (11)
Equity Adjustment for Translation -- 284 46
Preferred Stock -- -- --
Common Stock 41,133 41,122 41,117
Capital in Excess of Par Value 24,661 24,592 24,010
Retained Earnings 332,289 305,729 316,340
Less Treasury Stock at Cost (1,850) (1,850) (1,850)
--------- --------- ---------
Total Stockholders' Equity 396,213 369,857 379,652
--------- --------- ---------
Total Liabilities and
Stockholders' Equity $ 818,750 $ 725,439 $ 723,256
========= ========= =========
<FN> See notes to the condensed consolidated financial statements.
</TABLE>
Page 3 of 14<PAGE>
<TABLE>
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(unaudited)
(All amounts in thousands except per share data)
<CAPTION>
Nine Months Ended Three Months Ended
April 01, April 02, April 01, April 02,
1995 1994 1995 1994
----------------------- ---------------------
<S> <C> <C> <C> <C>
REVENUES:
Net Sales $1,280,191 $1,194,048 $ 324,457 $327,413
Other Income 8,386 7,771 2,879 2,314
---------- ---------- --------- --------
1,288,577 1,201,819 327,336 329,727
---------- ---------- --------- --------
COSTS AND EXPENSES:
Cost of Sales (Exclusive
of Depreciation
and Amortization) 848,106 775,226 216,556 212,960
Selling and Administrative
Expenses 367,955 312,171 115,235 104,253
Depreciation and Amortization 18,978 16,761 6,727 5,544
Interest Expense 10,355 7,378 2,991 2,415
--------- ---------- -------- -------
1,245,394 1,111,536 341,509 325,172
--------- ---------- -------- -------
Income (Loss) Before
Income Taxes 43,183 90,283 (14,173) 4,555
Provision (Benefit) For
Income Taxes 16,623 34,289 (5,144) 1,727
--------- ---------- -------- --------
Net Income (Loss) $26,560 $55,994 $ (9,029) $ 2,828
========= ========== ======== ========
Net Income (Loss) Per Share $0.65 $1.38 ($0.22) $0.07
========= ========== ======== ========
Weighted Average Shares
Outstanding 40,700,550 40,617,704 40,704,114 40,636,737
Dividends Per Share -- -- -- --
========== =========== ========== ==========
<FN>
See notes to the condensed consolidated financial statements.
</TABLE>
Page 4 of 14<PAGE>
<TABLE>
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(All amounts in thousands)
<CAPTION>
Nine Months Ended
April 01, April 02,
1995 1994
--------- ---------
<S> <C> <C>
OPERATING ACTIVITIES
Net Income $ 26,560 $ 55,994
Adjustments to Reconcile Net Income to Net Cash
Provided by Operating Activities:
Depreciation and Amortization 18,978 16,761
Provision for Deferred Income Taxes (1,790) 313
Loss on Disposition of Fixed Assets 102 216
Rent Expense and Other 4,487 4,563
Changes in Operating Assets and Liabilities:
Accounts Receivable (1,676) (8,894)
Merchandise Inventories (60,373) (65,059)
Prepaids and Other Current Assets 9,825 14,388
Accounts Payable 59,892 44,969
Other Current Liabilities 19,428 29,521
-------- --------
Net Cash Provided by Operating Activities 75,433 92,772
-------- --------
INVESTING ACTIVITIES
Acquisition of Property and Equipment (52,683) (48,241)
Acquisition of Leaseholds (2,652) (2,050)
Short Term Investments-Net -- (11,773)
Proceeds From Sale of Fixed Assets 23 17
Issuance of Long Term Notes Receivable (5,202) (2,515)
Receipts Against Long Term Notes Receivable 1,409 446
Minority Interest (38) 547
Other (123) 369
------- -------
Net Cash (Used) by Investing Activities (59,266) (63,200)
------- -------
FINANCING ACTIVITIES
Principal Payments on Long Term Debt (44) (104)
Issuance of Common Stock Upon Exercise of
Stock Options 80 501
Net Borrowings Under Lines of Credit (13,220) (2,098)
--------- --------
Net Cash (Used) in Financing Activities (13,184) (1,701)
--------- --------
Increase in Cash and Cash Equivalents 2,983 27,871
Cash and Cash Equivalents at Beginning of Period 21,236 34,881
--------- --------
Cash and Cash Equivalents at End of Period $ 24,219 $62,752
========= ========
Interest Paid: $ 8,510 $ 5,444
Income Taxes Paid: $ 10,172 $26,724
========= ========
<FN> See notes to the condensed consolidated financial statements.
</TABLE>
Page 5 of 14<PAGE>
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NINE AND THREE MONTHS ENDED April 1, 1995 AND April 2, 1994
1. The condensed consolidated financial statements include the accounts
of the Company and all its subsidiaries. All significant intercompany
accounts and transactions have been eliminated. The accompanying financial
statements are unaudited, but in the opinion of management reflect all
adjustments (which are of a normal and recurring nature) necessary for a
fair presentation of the results of operations for the interim period.
Because the Company's business is seasonal in nature, the operating results
for the nine and three months ended April 1, 1995 and the corresponding
periods ended April 2, 1994 are not necessarily indicative of results for
the fiscal year.
2. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested that
these condensed consolidated financial statements be read in conjunction
with the financial statements and notes thereto included in the Company's
Annual Report on Form 10-K filed with the Securities and Exchange
Commission on September 30, 1994.
3. Inventories as of April 1, 1995 and April 2, 1994 are valued by the
gross profit method and are stated at the lower of cost or market.
Inventories as of July 2, 1994 were valued by the retail inventory method.
4. As of April 1, 1995, the Company had a deferred tax liability of $7.1
million and a current deferred tax asset of $8.8 million. As of April 2,
1994, the Company had a deferred tax liability of $6.3 million and a
current deferred tax asset of $5.1 million. Valuation allowances were not
required. Deferred tax assets consisted primarily of certain operating
costs, provisions for uncollectible receivables, and certain inventory
related costs, not currently deductible for tax purposes. Deferred tax
liabilities primarily reflected the excess of tax depreciation over book
depreciation.
5. Licensee department sales, included in net sales, amounted to $20.0
million and $6.1 million for the nine and three month periods ended April
1, 1995 compared with $14.6 million and $4.1 million for the similar
periods of fiscal 1994.
6. Other current liabilities primarily consisted of sales tax payable,
accrued operating expenses, payroll taxes payable and other miscellaneous
items.
Page 6 of 14<PAGE>
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION
AND SUBSIDIARIES
Item 2. Management's Discussion and Analysis of Results of Operations and
Financial Condition.
Results of Operations
- ---------------------
The following table sets forth certain items in the condensed consolidated
statements of operations as a percentage of net sales for the nine and
three month periods ended April 1, 1995 and April 2, 1994.
<TABLE>
<CAPTION>
Percentage of Net Sales
Nine Months Ended Three Months Ended
April 1, April 2, April 1, April 2,
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Net Sales 100.0% 100.0% 100.0% 100.0%
Costs and expenses:
Cost of sales 66.2 64.9 66.7 65.1
Selling & adminis-
trative expenses 28.7 26.1 35.5 31.8
Depreciation &
amortization 1.5 1.4 2.1 1.7
Interest expense .8 .6 .9 .7
------- ------- ------- ------
97.2 93.0 105.2 99.3
------- ------- ------- ------
Other income .6 .6 .9 .7
------- ------- -------- -------
Income (loss) before
income taxes 3.4 7.6 (4.3) 1.4
Provision (benefit) for
income taxes 1.3 2.9 (1.6) .5
-------- -------- -------- -------
Net income (loss) 2.1% 4.7% (2.7%) .9%
======== ======== ======== =======
<FN>
</TABLE>
Page 7 of 14<PAGE>
Nine and Three Months Ended April 1, 1995 and April 2, 1994
- ----------------------------------------------------------------------
Net sales increased $86.1 million (7.2%) for the nine month period
ended April 1, 1995 compared with the similar period a year ago.
Comparative store sales decreased 7.0%. New Burlington Coat Factory
stores opened subsequent to April 2, 1994 contributed $102.8 million
to this year's sales. Stores which were in operation a year ago, but
which were closed prior to the beginning of the 1995 fiscal year,
contributed $11.0 million to last year's sales. The Cohoes stores
showed a comparative stores sales decrease of 13.4%, while
contributing $31.8 million to consolidated sales for the period. In
addition, one new Cohoes store was opened subsequent to April 2, 1994
which contributed $3.9 million to the Company's net sales total.
Sales in the nine month period for the Decelle stores were $24.8
million. Sales for the period December 6, 1993 through April 2, 1994
for the Decelle stores were $10.8 million. "New Concept" stores
opened subsequent to last year's third fiscal quarter, including,
three Totally 4 Kids stores, one Baby Depot store and one Fit For Men
store, contributed sales of $8.9 million to the current nine month
period. Sales from leased departments, included in the nine month net
sales figure, were $20.0 million compared with $14.6 million for the
similar period of a year ago.
For the three month period ended April 1, 1995, net sales decreased
.9% to $324.5 million compared with the similar period of a year ago.
Comparative store sales decreased 11.7%. New Burlington Coat Factory
Warehouse stores opened subsequent to April 2, 1994 contributed $31.3
million to the third quarter's net sales volume. Cohoes comparative
store sales decreased 10.8% for the third quarter. The new Cohoes
store contributed $1.1 million to this year's third quarter sales.
The "New Concept" stores contributed $3.2 million to this year's third
quarter sales. Decelle comparative store sales fell 5.6% to $5.8
million for the three months ended April 1, 1995. Leased department
sales, included in net sales, were $6.1 million for the third fiscal
quarter this year compared with $4.1 million in last year's similar
period.
Part of the decrease in sales is attributable to a later Easter
selling season this fiscal year compared with last year. For the
current fiscal year, two weeks of the Easter selling season fell into
the Company's fourth quarter compared with last year's Easter season
falling entirely into the third fiscal quarter. In addition, lack of
consumer interest in apparel throughout the third quarter, the highly
promotional retail environment and unseasonably warm weather in the
fall and winter months were all factors affecting sales results for
fiscal 1995.
Other income (consisting primarily of rental income from leased
departments, investment income and miscellaneous items) amounted to
$8.4 million for the nine months ended April 1, 1995 compared with
$7.8 million for the similar period of a year ago. For the three
months ended April 1, 1995 other income was $2.9 million compared with
$2.3 million for the three months ended April 2, 1994. For both the
nine and three month periods ended April 1, 1995 compared with the
similar periods of a year ago, increases in miscellaneous income items
were partially offset by decreases in investment income.
Page 8 of 14<PAGE>
Cost of sales increased by $72.9 million (9.4%) for the nine month period
ended April 1, 1995 compared with the similar period a year ago and by
$3.6 million (1.7%) for the quarter ended April 1, 1995 compared with the
similar period a year ago. Cost of sales as a percentage of net sales
increased from 64.9% to 66.2% for the nine months and increased from 65.1%
to 66.7% for the quarter ended April 1, 1995 compared with the similar
periods a year ago. These increases in cost of sales for both the nine month
and third quarter periods are primarily due to increases in markdowns taken as
a result of the weaker apparel sales performance in the periods. To the extent
apparel sales continue to perform below planned sales, the Company will
continue to take markdowns above last year's levels and the Company will
continue to experience a decline in gross margin percentage compared with the
prior periods.
Selling and administrative expenses increased by $55.8 million (17.9%) for the
nine month period ended April 1, 1995 compared with the similar period a year
ago. As a percentage of sales, selling and administrative expenses increased
to 28.7% from 26.1% in the comparable nine month periods. For the three months
ended April 1, 1995 selling and administrative expenses increased $11.0 million
to $115.2 million (10.5%). As a percentage of sales, selling and administrative
expenses were 35.5% compared with 31.8% for the similar period of a year ago.
For both the nine and three month periods ended April 1, 1995, compared with the
similar periods of a year ago, the dollar increases in selling and
administrative expenses are primarily due to an increase in the number of stores
in operation. The percentage increases are primarily due to the decreases in
comparative store sales in both the nine and three month periods.
Interest expense increased $3.0 million for the nine months ended April 1, 1995
compared with the similar period of fiscal 1994. For the three month period
ended April 1, 1995, interest expense increased $.6 million to $3.0 million
compared with the three months ended April 2, 1994. The three and nine month
increases in interest expense are the result of increases in interest rate and
borrowing levels associated with the borrowings made by the Company under its
revolving credit and term loan agreements.
The provision for income taxes decreased to $16.6 million for the nine months
ended April 1, 1995 from $34.3 million for the similar period of fiscal 1994.
For the three months ended April 1, 1995 the Company recorded an income tax
benefit of $5.1 million compared with a provision for income taxes of $1.7
million for the three months ended April 2, 1994. The effective tax rates were
38.5% and 36.3% for the nine and three month periods ended April 1, 1995
respectively, compared with 38.0% and 37.9 % for the comparable nine and three
month periods of fiscal 1994.
Net income decreased $29.4 million to $26.6 million for the nine months ended
April 1, 1995 from $56.0 million for the comparative period of fiscal 1994.
Income per share was $.65 per share for the current year's nine month period
compared with $1.38 for the similar period of a year ago. Net loss was $9.0
million for the three month period ended April 1, 1995 compared with net income
of $2.8 million for the three months ended April 2, 1994. Net loss per share
was $.22 per share for the three months ended April 1, 1995 compared with net
income per share of $.07 for the similar period of a year ago.
Page 9 of 14<PAGE>
Net income reflects a decline in the operating income of the Company.
The fiscal 1995 performance reflects a weak U.S. apparel environment
and an unusually warm fall and winter. In addition the devaluation
of the Mexican peso negatively affected the Company's six border
stores. As a result of the weak sales performance in a highly
promotional U.S. retail environment, higher markdowns have reduced the
Company's gross profit margins percentage in the current periods. In
addition, declining comparative store sales have negatively impacted
operating expense leverage.
The Company's business is seasonal, with its highest sales occurring
in the months of October, November, and December of each year. The
Company's net income generally reflects the same seasonal pattern as
its net sales. In the past, substantially all of the Company's
profits have been derived from operations during the months of
October, November and December.
The devaluation of the Mexican peso in late December, 1994 had an
immediate impact on sales of the six Burlington Coat Factory stores
along the U.S. border with Mexico, but has so far not had a material
effect on the Company as a whole. The Company believes sales of the
stores along the border will continue to be adversely affected so long
as the situation continues. In light of the uncertainty and
volatility of the Mexican peso, the Company decided in March of this
year to close down its Mexican store. The Mexican store will cease
doing business on or about June 10, 1995. The Company has reserved
$1.4 million for losses to be incurred with the closing of this store.
Liquidity and Capital Resources
During the nine months ended April 1, 1995, the Company opened twenty-
nine stores including twenty Burlington Coat Factory Warehouse
stores, one specialty men's store, "Fit for Men", five new "Luxury
Linens" stores, two "Totally 4 Kids" stores and one "Baby Depot" store.
Expenditures incurred to acquire, set up and fixture the twenty-nine
new stores opened through the first nine months of fiscal 1995 were
approximately $24.1 million. The Company also expended approximately
$5.5 million to purchase a building and a ground lease for two of
these stores and $3.2 million to renovate one store located in a
historic district of New York City to be opened in the first quarter
of fiscal 1996. In addition, the Company expended approximately $21.4
million for capital improvements and refurbishing of existing stores.
Approximately $3.7 million have been budgeted for capital improvements
of existing stores for the balance of the fiscal year.
Net cash provided by operating activities of $75.4 million, for the
nine months ended April 1, 1995, decreased from $92.8 million for the
comparable period of fiscal 1994. This decrease is primarily the
result of a decline in operating profits for the nine months ended
April 1, 1995 compared with operating profits for the nine months
ended April 2, 1994. At the end of the third fiscal quarter, the
Page 10 of 14<PAGE>
Company's merchandise inventory was $105.2 million higher than inventory at
the end of the third quarter of the prior year. Approximately half of
the increase is attributable to new stores opened in the current fiscal year,
and the balance to actual sales not meeting the Company's planned sales. The
Company will continue to focus on the reduction of comparable store inventory
levels by taking markdowns, as necessary, in non-outerwear inventory and by
reducing purchases of outerwear for the fall season.
The Company has in place a committed line of credit agreement in the amount of
$40 million. During this year's third fiscal quarter, the Company secured an
additional $20 million uncommitted line of credit. The Company's aggregate
uncommitted lines of credit total $160 million. During the first quarter of
fiscal 1995 the Company had maximum borrowings of $123.3 million. The
average borrowing during the quarter amounted to $91.8 million at an average
interest rate of 5.2%. During the second quarter of fiscal 1995, the Company
had maximum borrowings under these agreements of $145.9 million. The average
borrowing during this period was $92.9 million with an average borrowing
interest rate of 5.5%. For the third fiscal quarter of fiscal 1995, the
Company had a maximum borrowing of $65.0 million under its lines of credit.
The average borrowings during this period amounted to $38.8 million at an
average interest rate of 6.5%. During the first quarter of fiscal 1994 the
Company had maximum borrowings under these agreements of $31.4 million. The
average borrowing during the first quarter amounted to $12.1 million at an
average interest rate of 3.6%. During the second quarter of fiscal 1994, the
Company had maximum borrowings under these agreements of $20.8 million with
an average borrowing of $6.9 million at an average interest rate of3.6%.
During the third fiscal quarter of fiscal 1994, the Company had maximum
borrowings under the lines of credit of $18.3 million. The average borrowing
during that quarter amounted to $10.0 million at an average interest rate of
4.0%. As of April 1, 1995 borrowings under these lines of credit amounted to
$51.8 million. As of April 2, 1994 all borrowings under these agreements had
been repaid.
The Company's long-term borrowings at April 1, 1995 include $80 million of
long term subordinated notes issued by the Company to institutional investors in
June 1990 (the Notes) and an industrial development bond of $10 million
issued by the New Jersey Economic Development Authority.
The Notes mature on June 27, 2005 and bear interest at the rate of 10.6% per
annum. The Notes have an average maturity of ten years and are subject to
mandatory prepayment in installments of $8 million each without premium on
June 27 of each year beginning in 1996. The Notes are subordinated to senior
debt, including, among others, bank debt and indebtedness for borrowed money.
The interest rate on the industrial development bond financing is fixed at
9.78% over the life of these serial and term bonds (the Bonds). The Company is
currently applying to the New Jersey Economic Development Authority for
permission to refinance the Bonds. If permission is granted, and if the
refinancing is successfuly completed, the Bonds will be called at 103 on
September 1, 1995 and refinanced with credit enhanced term bonds that have
the same remaining maturity as the original issue. The current interest rate
on the refinancing is estimated to be around 5.75%.
Page 11 of 14<PAGE>
The increase in short term borrowing at April 1, 1995 over April 2, 1994 is
the direct result of poorer sales performance during the current fiscal year.
As a result, the Company has reduced its expansion plans to opening between 12
and 15 additional stores in fiscal 1996. The Company projects all borrowings
under its lines of credit will be repaid by the end of the second quarter of
fiscal 1996.
The Company believes that its current capital expenditure and operating
requirements will be satisfied from internally generated funds, and from short
term borrowings under its revolving credit and term loan agreement as well as
uncommitted lines of credit. The Company may consider replacing some of its
short term borrowings with long term financing. Furthermore, to the extent
that the Company decides to purchase additional store locations, it may be
necessary to finance such acquisitions with additional long term borrowings.
The Company believes that the current operating results will not have a
material effect on its ability to obtain financing.
On or about September 23, 1994 three separate class actions were filed
against the Company. These three actions were consolidated and an
amended complaint was received on January 18, 1995. (See Part II -
Other Information, Item 1 Legal Proceedings.) The Company is unable
to determine the probability of any potential loss with respect to
these class action suits or the materiality thereof at this time and
accordingly has not established any reserve for this matter. However,
the Company believes the actions are without merit and intends to
vigorously defend them.
Historically, the Company has been able to increase its selling
prices as the costs of merchandising and related operating expenses
have increased and, therefore, inflation has not had a significant
effect on operations.
New Accounting Standards
In November 1992, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 112, "Employers'
Accounting for Post Employment Benefits". This pronouncement did not
have an effect on the Company's condensed consolidated financial
statements as the benefits covered in the pronouncement are not
provided by the Company.
Page 12 of 14<PAGE>
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION
AND SUBSIDIARIES
PART II - OTHER INFORMATION
Item 1 Legal Proceedings
In late September 1994, three putative class action
lawsuits, P. Gregory Buchanan v. Monroe G. Milstein, et al., No. 94-
CV-4663, Jacob Turner v. Monroe G. Milstein, et al., No. 94-CV-4737,
and Ronald Abramoff v. Monroe G. Milstein, et al., No. 94-CV-4751
(collectively, the "Class Actions"), were filed against the Company,
Monroe G. Milstein, Stephen E. Milstein and Robert L. LaPenta, Jr. in
the United States District Court for the District of New Jersey. By
Order entered November 15, 1994, the Court consolidated the Class
Actions under the caption, In re Burlington Coat Factory Securities
Litigation. On January 17, 1995, plaintiffs filed their Consolidated
Amended and Supplemental Class Action Complaint (the "Amended
Complaint"), naming as defendants, in addition to those originally
named in September 1994, Andrew R. Milstein and Mark A. Nesci. The
Amended Complaint seeks unspecified damages in connection with
alleged violations of Section 10(b) (and Rule 10b-5 promulgated
thereunder) and 20(a) of the Securities Exchange Act of 1934, as
amended. The Amended Complaint alleges material misstatements and
omissions by the Company and certain of its officers and directors
that plaintiffs allege caused the Company's common stock to be
artificially inflated during the proposed Class Period, which is
defined in the Amended Complaint as the period from October 4, 1993
through September 23, 1994. On March 3, 1995, the Company and the
individual defendants served a motion to dismiss plaintiffs' Amended
Complaint. That motion is scheduled to be fully briefed and filed
with the Court by May 17, 1995. Although the Company is unable at
this time to assess the probable outcome of the Class Actions or the
materiality of the risk of loss in connection therewith (given that
the Amended Complaint does not allege damages with any particularity),
the Company believes that the Class Actions are without merit and
intends to vigorously defend them.
Item 6 Exhibits and Reports on Form 8-K
Page No.
a. Exhibits
None
b. No reports on Form 8-K have been filed during the
quarter for which this report is filed
Page 13 of 14<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.
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION
/s/ MONROE G. MILSTEIN
___________________________________
Monroe G. Milstein
President & Chief Executive Officer
/s/ ROBERT L. LAPENTA, JR.
___________________________________
Robert L. LaPenta, Jr.
Corporate Controller & Chief Accounting
Officer
Date: May 15, 1995
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<TABLE> <S> <C>
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