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 March 29, 1997
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 out-
standing of each of the issuer's classes
of common stock, as of the latest
practicable date.
Class Outstanding at May 6, 1997
- -------------------------- --------------------------
Common stock, par value $1 41,232,143
Page 1 of 17<PAGE>
<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 - March 29, 1997 3
(unaudited), June 29, 1996 and March 30, 1996 (unaudited)
Condensed consolidated statements of operations - Nine and 4
three months ended March 29, 1997 and March 30, 1996
(unaudited)
Condensed consolidated statements of cash flows - Nine and 5
three months ended March 29, 1997 and March 30, 1996
(unaudited)
Notes to condensed consolidated financial statements 6
Item 2. Management's discussion and analysis of results 8-14
of operations and financial condition
Part II - Other Information:
Item 1. Legal Proceedings 15
Item 6. Exhibits and reports on Form 8-K 15
SIGNATURES 16
* * * * * * * * * * * *
Page 2 of 17<PAGE>
<PAGE>
<TABLE>
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION
AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(All amounts in thousands)
<CAPTION>
March 29, June 29, March 30,
1997 1996 1996
(Unaudited) (Note A) (Unaudited)
___________ ________ ___________
ASSETS
<S> <C> <C> <C>
Current Assets:
Cash and Cash Equivalents $231,170 $ 73,560 $120,366
Accounts Receivable 19,767 15,003 17,931
Merchandise Inventories 401,528 370,437 428,750
Deferred Tax Asset 10,906 9,762 10,320
Prepaid and Other Current Assets 11,856 19,808 4,686
_______ ________ ________
Total Current Assets 675,227 488,570 582,053
Property and Equipment (Net of Accumulated
Depreciation and Amortization) 209,551 206,582 212,758
Other Assets 8,457 9,579 10,117
________ ________ ________
Total Assets $893,235 $704,731 $804,928
======== ======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts Payable $225,369 $118,900 $189,586
Notes Payable -- -- --
Income Taxes Payable 22,123 5,227 15,567
Other Current Liabilities 87,343 67,945 75,690
Current Maturities of Long Term Debt 7,826 8,391 8,071
________ ________ ________
Total Current Liabilities 342,661 200,463 288,914
Long Term Debt 69,698 74,907 83,244
Other Liabilities 8,734 8,237 8,322
Deferred Tax Liability 7,636 7,379 6,228
Stockholders' Equity:
Unearned Compensation (61) (87) --
Preferred Stock -- -- --
Common Stock 41,229 41,165 41,150
Capital in Excess of Par Value 25,762 25,384 25,243
Retained Earnings 408,635 349,608 353,651
Less Treasury Stock at Cost (11,059) (2,325) (1,824)
________ ________ _________
Total Stockholders' Equity 464,506 413,745 418,220
________ ________ ________
Total Liabilities and
Stockholders' Equity $893,235 $704,731 $804,928
======== ======== ========
<FN>
See notes to the condensed consolidated financial statements.
NOTE A: The balance sheet at June 29, 1996 has been derived from the audited
financial statements at that date.
</TABLE>
Page 3 of 17<PAGE>
<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
March 29, March 30, March 29, March 30,
1997 1996 1997 1996
_____________________ _____________________
REVENUES:
<S> <C> <C> <C> <C>
Net Sales $1,429,618 $1,273,092 $382,420 $323,234
Other Income 13,243 14,299 5,650 6,707
__________ __________ ________ ________
1,442,861 1,287,391 388,070 329,941
__________ __________ _________ ________
COSTS AND EXPENSES:
Cost of Sales (Exclusive of
Depreciation
and Amortization) 922,983 834,176 248,249 215,164
Selling and Administrative
Expenses 391,255 366,173 123,704 112,753
Depreciation and
Amortization 22,525 21,613 7,433 7,329
Interest Expenses 6,097 9,454 1,947 2,351
_________ _________ _______ _______
1,342,860 1,231,416 381,333 337,597
_________ _________ _______ _______
Income (Loss) Before
Income Taxes 100,001 55,975 6,737 (7,656)
Provision (Benefit) For
Income Taxes 40,974 22,919 2,885 (3,089)
__________ __________ ________ _________
Net Income (Loss) $ 59,027 $ 33,056 $ 3,852 $ (4,567)
========== ========== ======== =========
Earnings Per Share:
Net Income (Loss) Per
Share $ 1.46 $ 0.81 $ 0.10 $ (0.11)
========== ========== ======== ==========
Weighted Average Shares
Outstanding 40,314,700 40,715,343 39,923,964 40,718,641
========== ========== ========== ==========
- - - -
Dividends Per Share ========== ========== ========== ==========
<FN>
See notes to the condensed consolidated financial statements.
</TABLE>
Page 4 of 17<PAGE>
<PAGE>
<TABLE>
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(All amounts in thousands)
<CAPTION>
Nine Months Ended
March 29, March 30,
1997 1996
_________ _________
<S> <C> <C>
OPERATING ACTIVITIES
Net Income $ 59,027 $ 33,056
Adjustments to Reconcile Net Income to Net Cash
Provided by Operating Activities:
Depreciation and Amortization 22,525 21,613
Provision for Losses on Accounts Receivable 4,751 3,680
Provision for Deferred Income Taxes (887) (1,220)
Loss (Gain) on Disposition of Fixed Assets 905 174
Rent Expense and Other 1,190 1,352
Changes in Operating Assets and Liabilities:
Accounts Receivable (9,934) (6,392)
Merchandise Inventories (31,091) 23,276
Prepaids and Other Current Assets 7,946 1,320
Accounts Payable 106,469 88,540
Other Current Liabilities 36,294 34,516
_________ _________
Net Cash Provided by Operating Activities 197,195 199,915
_________ _________
INVESTING ACTIVITIES
Acquisition of Property and Equipment (26,714) (27,180)
Proceeds From Sale of Fixed Assets 381 17,628
Issuance of Long Term Notes Receivable - (413)
Receipts Against Long Term Notes Receivable 897 4,194
Minority Interest (111) (12)
Other 2 (2,474)
_________ ________
Net Cash Used by Investing Activities (25,545) (8,257)
_________ ________
FINANCING ACTIVITIES
Principal Payments on Long Term Debt (5,774) (49)
Issuance of Common Stock Upon Exercise
of Stock Options 468 137
Repayment of Borrowings Under Lines of Credit - (85,900)
Purchase of Treasury Stock (8,734) -
________ ________
Net Cash Used in Financing Activities (14,040) (85,812)
________ ________
Increase in Cash and Cash Equivalents 157,610 105,846
Cash and Cash Equivalents at Beginning
of Period 73,560 14,520
________ _________
Cash and Cash Equivalents at End of Period $231,170 $120,366
======== ========
Interest Paid: $ 4,500 $ 7,773
Income Taxes Paid: $ 24,965 $ 10,636
======== ========
<FN>
See notes to the condensed consolidated financial statements.
</TABLE>
Page 5 of 17
<PAGE>
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NINE AND THREE MONTHS ENDED MARCH 29, 1997 AND MARCH 30, 1996
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 March 29, 1997 and the corresponding
periods ended March 30, 1996 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 28, 1996.
3. Inventories as of March 29, 1997 and March 30, 1996 are stated at the
lower of FIFO cost or market, as valued by the gross profit method.
Inventories as of June 29, 1996 were valued by the retail inventory method.
4. As of March 29, 1997, the Company had a deferred tax liability of $7.6
million and a current deferred tax asset of $10.9 million. As of March 30,
1996, the Company had a deferred tax liability of $6.2 million and a
current deferred tax asset of $10.3 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
$26.9 million and $7.7 million for the nine and three month periods
ended March 29, 1997 compared with $26.8 million and $7.2 million
for the similar periods of fiscal 1996.
6. Other current liabilities primarily consisted of sales tax
payable, accrued operating expenses, payroll taxes payable and other
miscellaneous items.
Page 6 of 17<PAGE>
<PAGE>
7. Recent Accounting Pronouncements
a. In March 1995, the Financial Accounting Standards Board
("FASB") issued Statement of Financial Accounting Standards ("SFAS")
No. 121, Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to Be Disposed of. The Company adopted this
statement in the first fiscal quarter of the current fiscal year as
required by this statement. This statement requires that long-lived
assets and certain identifiable intangibles to be held and used by
an entity be reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not
be recoverable. Also, in general, long-lived assets and certain
intangibles to be disposed of should be reported at the lower of
carrying amount or fair value less cost to sell. The Company
considers historical performance and future estimated results in its
evaluation of potential impairment and then compares the carrying
amount of the asset to the estimated future cash flows expected to
result from the use of the asset. If the carrying amount of the
asset exceeds estimated expected undiscounted future cash flows, the
Company measures the amount of the impairment by comparing the
carrying amount of the asset to its fair value. The estimation of
fair value is generally measured by discounting expected future cash
flows at the rate the Company utilizes to evaluate potential
investments. The Company estimates fair value based on the best
information available making whatever estimates, judgments and
projections are considered necessary. As of March 29, 1997 the
Company has determined that no adjustment under this statement is
required.
b. In October 1995, the Financial Accounting Standards Board
issued Statement of Financial Accounting Standards No. 123,
Accounting for Stock-Based Compensation, which is effective for the
Company beginning June 30, 1996. SFAS No. 123 requires expanded
disclosure of stock-based compensation arrangements with employees
and encourages (but does not require) compensation expense to be
measured based on the fair value of the equity instrument awarded.
Companies are permitted, however, to continue to apply Accounting
Principles Board Opinion No. 25 (APB No. 25), which recognizes
compensation costs based on the intrinsic value of the equity
instrument awarded. The Company has adopted SFAS No. 123 in the
current fiscal year and as permitted will continue to apply APB No.
25 to its stock-based compensation awards to employees and will
disclose the required pro-forma effects on net income and earnings
per share as required by SFAS No. 123.
c. In February 1997, the Financial Accounting Standards Board
issued Statement of Financial Accounting Standards No. 128, Earnings
Per Share. This Statement will be effective for financial reporting
purposes, for both interim and year-end financial statements ending
after December 15, 1997. The Company anticipates that this Statement
will not have a material effect on its financial statements.
Page 7 of 17
<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 March 29, 1997 and March 30, 1996.
<TABLE>
<CAPTION>
Percentage of Net Sales
_______________________
Nine Months Ended Three Months Ended
_________________ __________________
March 29, March 30, March 29, March 30,
1997 1996 1997 1996
_________ _________ _________ _________
<S> <C> <C> <C> <C>
Net sales 100.0% 100.0% 100.0% 100.0%
Costs and expenses:
Cost of sales 64.5 65.5 64.9 66.6
Selling & adminis-
trative expenses 27.4 28.8 32.4 34.9
Depreciation &
amortization 1.6 1.7 1.9 2.3
Interest expense .4 .7 .5 .7
------- ------- ------- -------
93.9 96.7 99.7 104.5
------- ------- ------- -------
Other income .9 1.1 1.5 2.1
------- ------- ------- -------
income (loss) before
income taxes 7.0 4.4 1.8 (2.4)
Provision (benefit for
income taxes 2.9 1.8 .8 (1.0)
------- ------- ------- -------
Net income (loss) 4.1% 2.6% 1.0% (1.4%)
======== ======== ======== ========
</TABLE>
Page 8 of 17<PAGE>
<PAGE>
Nine and Three Months Ended March 29, 1997 and March 30, 1996
- -----------------------------------------------------------------
Net sales increased $156.5 million (12.3%) for the nine month
period ended March 29, 1997 compared with the similar period a year
ago. Comparative store sales increased 9.3%. New stores opened
subsequent to last year's third fiscal quarter contributed $31.2
million to this year's net sales including $28.2 million from eight
new Burlington Coat Factory stores, $2.3 million from a new Totally
4 Kids store, $.5 million from a new Decelle store and $.2 million
from a new Baby Depot store. Sales from stores that were in
operation a year ago but which were closed prior to this fiscal
year, contributed $15.3 million to last year's net sales. Sales
from leased departments, included in this year's nine month net
sales figure, were $26.9 million compared with $26.8 million for
the similar period of a year ago.
For the three month period ended March 29, 1997, net sales
increased 18.3% to $382.4 million compared with the similar period
of a year ago. Comparative store sales increased 14.9%. New
stores opened subsequent to March 30, 1996 contributed $13.5
million to this year's third fiscal quarter net sales. Sales from
stores that were in operation a year ago but which were closed
prior to this year's third fiscal quarter contributed $5.1 million
to last fiscal year's third quarter net sales. Leased department
sales, included in net sales, were $7.7 million and $7.2 million
for the three months ended March 29, 1997 and March 30, 1996,
respectively.
Sales for the nine and three month periods were favorably affected
by approximately $12.0 million due to an earlier Easter in the
current fiscal year, when compared with fiscal 1996. During fiscal
1996, approximately one week of the Easter season fell into the
fourth fiscal quarter. For fiscal 1997, the entire Easter selling
season fell into the third fiscal quarter.
Other income (consisting of rental income from leased departments,
investment income and miscellaneous items) decreased to $13.2
million for the nine months ended March 29, 1997 compared with
$14.3 million for the nine months ended March 30, 1996. Investment
income increased $3.4 million for the nine months ended March 29,
1997 compared with the similar period of a year ago. Offsetting
this increase were higher net losses on dispositions of property
during fiscal 1997 compared with fiscal 1996, of approximately $.7
million. In addition, the Company recorded miscellaneous non-
ecurring income items of approximately $.6 million during fiscal
1997 compared with $4.0 million during fiscal 1996.
Page 9 of 17
<PAGE>
For the three months ended March 29, 1997, other income was $5.7
million compared with $6.6 million for the three months ended March
30, 1996. Investment income increased $1.7 million and losses
recorded for leasehold improvement write-offs decreased approximately
$1.5 million for the three months ended March 29, 1997 compared with
the similar period of a year ago. Offsetting these improvements were
miscellaneous non-recurring items of $4.0 million recorded in last fiscal
year's third quarter.
Cost of sales increased by $88.8 million (10.6%) for the nine month
period ended March 29, 1997 compared with the similar period a year
ago and by $33.1 million (15.4%) for the quarter ended March 29,
1997 compared with the similar period a year ago. Cost of sales as
a percentage of net sales decreased from 65.5% to 64.5% for the
nine months and decreased from 66.6% to 64.9% for the quarter ended
March 29, 1997 compared with similar periods a year ago. The
decrease in cost of sales, as a percentage of sales, for the nine
month period is due to improvements in the Company's initial
markons. The Company's initial markons have improved due to better
buys from vendors, particularly in outerwear, driven by the ability
to purchase merchandise opportunistically. However, there can be
no assurance that the opportunistic purchases will continue to be
available in the future. The improvement in cost of sales, as a
percentage of net sales, for the three months ended March 29, 1997
is the result of a decrease in markdowns taken as a percentage of
sales compared with the similar quarter of fiscal 1996.
Selling and administrative expenses increased by $25.1 million
(6.8%) for the nine month period ended March 29, 1997 compared with
the similar period a year ago. As a percentage of sales, selling
and administrative expenses decreased to 27.4% from 28.8% in the
comparable nine month period. For the three months ended March 29,
1997, selling and administrative expenses increased $11.0 million
to $123.7 million (9.7%). As a percentage of sales, selling and
administrative expenses were 32.4% compared with 34.9% for the
similar period of a year ago. For both the nine and three month
periods ended March 29, 1997, compared with the similar periods of
a year ago, the dollar increases in selling and administrative
expenses are primarily due to an increase in payroll expenditures.
Payroll costs increased due to annual pay increases granted
subsequent to last year's third quarter, payroll expenditures for
stores opened subsequent to last year's third quarter and to
increased staffing levels at the stores, home office and
distribution center due to the substantial increase in business
during the fiscal year. In addition, advertising expense increased
Page 10 of 17
<PAGE>
approximately $3.0 million in the current fiscal year's third
quarter compared with the third quarter of fiscal 1996 due to the
earlier Easter season.
Interest expense decreased $3.4 million for the nine months ended
March 29, 1997 compared with the similar period of fiscal 1996.
For the three month period ended March 29, 1997, interest expense
was $1.9 million, a decrease of $.4 million compared with the three
months ended March 30, 1996. The nine and three month decreases in
interest expense are the result of decreases in borrowing levels
associated with the Company's revolving credit and term loan
agreements, refinancing of its industrial revenue bond and the
repayment of $13.4 million of its subordinated bonds.
The provision for income taxes increased to $41.0 million for the
nine months ended March 29, 1997 from $22.9 million for the similar
period of fiscal 1996. For the three months ended March 29, 1997
the provision for income taxes increased to $2.9 million from a tax
benefit of $3.1 million for the comparable period of a year ago.
The effective tax rates were 41.0% and 40.9% for the nine month
period ended March 29, 1997 and March 30, 1996, respectively. For
the three months ended March 29, 1997 and March 30, 1996, the
effective tax rates were 42.8% and 40.3%, respectively.
Net income increased $26.0 million to $59.0 million for the nine
months ended March 29, 1997 from $33.1 million for the comparative
period of fiscal 1996. Income per share was $1.46 per share for
the current year's nine month period compared with $.81 for the
similar period of a year ago. Net income was $3.9 million for the
three month period ended March 29, 1997 compared with a $4.6
million loss for the three months ended March 30, 1996. Net income
per share increased to $.10 per share for the three months ended
March 29, 1997 compared with an $.11 loss per share for similar
period of a year ago.
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.
Liquidity and Capital Resources
_______________________________
The Company opened one Burlington Coat Factory store during the
first quarter of fiscal 1997, two stores in the second fiscal
Page 11 of 17
<PAGE>
quarter, and five additional stores in the third fiscal quarter.
The Company also opened one Totally 4 Kids store during this year's
second quarter, and one new Baby Depot Store and one new Decelle
store during this year's third quarter. The Company estimates
spending approximately $7.5 million for store openings during this
fiscal year, of which approximately $5.7 million has been expended
as of March 29, 1997. In addition, the Company plans to spend
approximately $11.8 million for the refurbishing and refixturing of
existing stores, of which $9.4 million has been expended as of the
end of this year's third fiscal quarter. During the second quarter,
the Company purchased the land and building associated with one of
its stores for approximately $2.5 million. Expenditures for
computer systems, at both the corporate and store level, are
expected to be approximately $11.0 million during fiscal 1997.
Through the first nine months of the current fiscal year,
approximately $9.3 million of computer system expenditures have
been made.
The Company repurchased 743,900 shares of its stock,
costing approximately $8.7 million in the current fiscal year.
These purchases are reflected as treasury stock in the equity
section of the balance sheet. As of March 29, 1997, the Company
has authority to purchase an additional $1.2 million of its stock.
Working capital increased to $332.6 million at March 29, 1997 from
$293.1 million at March 30, 1996.
Net cash provided by operating activities was $197.2 million for
the nine months ended March 29, 1997, a decrease of $2.7 million
from $199.9 million in net cash provided by operating activities
for the comparable period of fiscal 1996.
The Company's long-term borrowings as of March 29, 1997 included
$66.6 million of long term subordinated notes issued by the Company
to institutional investors in June 1990 ("the Notes") and an
industrial development bond of $9.7 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 five years
and are subject to mandatory prepayment in installments of $8.0
million each without premium on June 27 of each year. These
repayments began with the first prepayment being made June 27,
1996. The Notes are subordinated to senior debt, including, among
others, bank debt and indebtedness for borrowed money. During the
Page 12 of 17
<PAGE>
first quarter of fiscal 1997, the Company repurchased an additional
$5.4 million of the Notes which reduced the Company's mandatory
prepayment to $7.4 million annually. The Company has no current
plan to repurchase or repay any additional amounts earlier than
scheduled, but may consider doing so in the future should
conditions favorable to the Company present themselves.
The interest rate on the industrial development bond financing was
originally fixed at 9.78% over the life of these serial and term
bonds (the "Bonds"). The Company refinanced its industrial
development bonds with the New Jersey Economic Development
Authority on September 1, 1995. The original bonds were called at
103 and refinanced with credit enhanced bonds (the "Refunding
Bonds"). The Refunding Bonds consist of serial and term bonds
having the same maturity as the original issue. The serial bonds
aggregate $3.6 million and mature in series annually on September
1, beginning in 1996 and continuing to and including 2003. The
term bonds consist of two portions, $1.4 million maturing on
September 1, 2005 and $5.0 million maturing on September 1, 2010.
The serial bonds bear interest ranging from 3.75% to 5.4% per
annum, and the term bonds bear interest at the rates of 5.60% for
the portion maturing on September 1, 2005 and 6.125% per annum for
the portion maturing on September 1, 2010. The average interest
rate and average maturity of the Refunding Bonds are 5.84% and 8
years, respectively. During the current year's first fiscal
quarter, the Company expended approximately $.3 million for the
repayment of the Refunding Bonds.
The Company has in place a committed line of credit agreement in
the amount of $50.0 million and $150.0 million in uncommitted lines
of credit. The Company had no borrowings under these credit lines
during fiscal 1997's first three quarters. The maximum borrowings
outstanding under these lines were $120.4 million during the first
quarter of fiscal 1996. The average borrowings outstanding under
the lines were $98.1 million during the first quarter of fiscal 1996
at an average interest rate of 6.2%. During the second quarter of
fiscal 1996, the Company had a maximum borrowings under these
agreements of $84.3 million. The average borrowing during this
period was $65.1 million with an average borrowing interest rate of
6.2%. As of December 30, 1995, all borrowings under these agreements
had been repaid. There were no additional borrowings under these
lines of credit during the third fiscal quarter of 1996.
The decrease in short term borrowings, during the nine-month period
ended March 29, 1997, over the similar period of a year ago is the
Page 13 of 17
<PAGE>
direct result of continued maintenance of lower inventory levels in
the stores. In addition, liquidity was enhanced by a significant
increase in profitability during fiscal 1996 and the first three
quarters of fiscal 1997. Also, reductions in capital expenditures
during fiscal 1996 and the first nine months of fiscal 1997
resulted in lower borrowing requirements.
The Company believes that its current capital expenditures and
operating requirements can be satisfied from internally generated
funds, from short term borrowings under its revolving credit and
term loan agreement as well as uncommitted lines of credit and from
its long term borrowings. 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.
On or about September 23, 1994, three separate putative class
actions were filed against the Company. These three actions were
consolidated and an amended complaint was served on January 17,
1995. The Company filed a motion to dismiss on May 17, 1995 and a
hearing on the motion was held on July 20, 1995. On February 20,
1996, the District Court dismissed the plaintiffs' amended
complaint in its entirety. In March, 1996, the plaintiffs filed an
appeal from the District Court's decision. In December 1996, the
Court of Appeals for the Third Circuit heard oral argument on
plaintiffs' appeal. (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.
Page 14 of 17
<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 sought
unspecified damages in connection with alleged violations of
Sections 10(b) (and Rule 10b-5 promulgated thereunder) and 20(a) of
the Securities Exchange Act of 1934, as amended. The Amended
Complaint alleged material misstatements and omissions by the
Company and certain of its officers and directors that plaintiffs
alleged caused the Company's common stock to be artificially
inflated during the proposed Class Period, which was defined in the
Amended Complaint as the period from October 4, 1993 through
September 23, 1994. On February 20, 1996, the District Court
granted the Company's motion to dismiss the plaintiffs' Amended
Complaint in its entirety. In March 1996, the plaintiffs filed an
appeal from the District Court's decision in the United States
Court of Appeals for the Third Circuit (the "Appeal"). On December
12, 1996, the Third Circuit entertained oral argument in connection
with the Appeal. Although the Company is unable at this time to
assess the probable outcome of the Appeal or the materiality of the
risk of loss in connection therewith, the Company fully agrees with
the District Court's decision to dismiss the Amended Complaint in
its entirety.
Item 6 Exhibits and Reports on Form 8-K
Page No.
________
a. Exhibits
27. Financial Data Schedule 17
b. The Company filed no current reports on Form 8-K
for the period ended March 29, 1997.
Page 15 of 17<PAGE>
<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 13, 1997
Page 16 of 17<PAGE>
<PAGE>
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