==============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________________
FORM 10-Q
____________________________________
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
FOR THE THIRTEEN WEEKS ENDED COMMISSION FILE NUMBER 1-8564
APRIL 2, 1994
SYMS CORP
(Exact name of registrant as specified in its charter)
NEW JERSEY NO. 22-2465228
(State or other jurisdiction of (I.R.S. employer identification no.)
incorporation or organization)
SYMS WAY, SECAUCUS, NEW JERSEY 07094
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (201) 902-9600
Indicate by check mark whether 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
----- -----
The number of shares of the Registrant's Common Stock, par
value $.05 outstanding at May 12, 1994: 17,692,015
==============================================================================
<PAGE>
----------------------------
SYMS CORP AND SUBSIDIARIES
----------------------------
INDEX
-----
PAGE NO.
--------
PART I. Financial Information:
Item 1. Financial Statements
Consolidated Condensed Balanced Sheets --
April 3, 1993, April 2, 1994 and January 1, 1994. 1
Consolidated Condensed Statements of Income --
Thirteen Weeks Ended April 3, 1993 and April 2, 1994. 2
Consolidated Condensed Statements of Cash Flows --
Thirteen Weeks Ended April 3, 1993 and April 2, 1994. 3
Notes to Consolidated Condensed Financial Statements. 4
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations. 5-6
PART II. Other Information 7
<PAGE>
----------------------------
SYMS CORP AND SUBSIDIARIES
----------------------------
Consolidated Condensed Balance Sheets
(In Thousands Except Share Amounts)
APRIL 3, APRIL 2, JANUARY 1,
1993 1994 1994
(UNAUDITED) (UNAUDITED) ( * )
----------- ----------- ----------
ASSETS
Current Assets
Cash and Cash equivalents $ 519 $ 966 $ 1,347
Marketable securities 8,625 --- ---
Merchandise inventories (note 2) 95,743 90,558 79,418
Prepaid expenses and other current
assets 5,198 4,556 4,857
Deferred income taxes 1,431 1,546 1,406
-------- -------- --------
TOTAL CURRENT ASSETS 111,516 97,626 87,028
Property and equipment, net of
accumulated depreciation and
amortization 119,257 132,094 130,279
Other assets 3,266 4,104 3,845
-------- -------- --------
TOTAL ASSETS $234,039 $233,824 $221,152
======== ======== ========
LIABILITIES AND SHAREHOLDERS EQUITY
Current Liabilities
Current portion of obligations under
capital lease $ 206 $ 245 $ 234
Accounts payable 38,217 28,948 14,864
Accrued expenses and taxes other
than income taxes 3,386 4,501 4,418
Obligations to customers 3,249 3,222 3,500
Income taxes 3,465 2,863 4,141
-------- -------- --------
TOTAL CURRENT LIABILITIES 48,523 39,779 27,157
-------- -------- --------
Obligations under capital lease 2,154 1,909 1,974
-------- -------- --------
Deferred income taxes 1,658 1,206 1,416
-------- -------- --------
Shareholders equity
Preferred stock - par value, $100
per share; authorized 1,000,000
shares; none issued
Common stock - par value, $.05 per
share; authorized 30,000,000
shares; issued and outstanding
17,690,215 shares - April 3, 1993;
17,692,015 shares - January 1, 1994
and April 2, 1994 885 885 885
Additional paid-in capital 11,677 11,695 11,695
Retained earnings 169,142 178,350 178,025
-------- -------- --------
TOTAL SHAREHOLDERS EQUITY 181,704 190,930 190,605
-------- -------- --------
TOTAL LIABILITIES AND
SHAREHOLDERS EQUITY $234,039 $233,824 $221,152
======== ======== ========
* Condensed from Audited Consolidated Financial Statements.
See accompanying notes to Consolidated Condensed Financial Statements.
1
<PAGE>
----------------------------
SYMS CORP AND SUBSIDIARIES
----------------------------
Consolidated Condensed Statements of Income
(In Thousands, Except Per Share Amount)
THIRTEEN WEEKS ENDED
APRIL 3, APRIL 2,
1993 1994
(UNAUDITED) (UNAUDITED)
--------- ---------
Net Sales $66,875 $68,642
-------- -------
Costs and expenses:
Cost of Sales 45,476 46,676
Operating, general and
administrative 15,324 16,872
Occupancy 2,208 2,666
Depreciation and amortization 1,847 1,784
Interest - net 21 67
-------- -------
64,876 68,065
-------- -------
Income before provision for income
taxes 1,999 577
Provision for income taxes 920 252
-------- -------
Net income $ 1,079 $ 325
======== =======
Earnings per share $ .06 $ .02
======== =======
Weighted average shares outstanding 17,690 17,692
======== =======
See accompanying notes to Consolidated Condensed Financial Statements.
2
<PAGE>
----------------------------
SYMS CORP AND SUBSIDIARIES
----------------------------
Consolidated Condensed Statements of Cash Flows
(In Thousands)
THIRTEEN WEEKS ENDED
APRIL 3, APRIL 2,
1993 1994
(UNAUDITED) (UNAUDITED)
--------- ---------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $ 1,079 $ 325
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 1,847 1,784
Deferred income taxes (467) (350)
Changes in assets and liabilities:
Merchandise inventories (28,011) (11,140)
Prepaid expenses and other current
assets (1,022) 301
Other assets (103) (259)
Accounts payable 32,612 14,084
Obligations to customers (161) (278)
Accrued expenses and taxes other
than income taxes (871) 83
Income tax payable (2,419) (1,278)
-------- -------
TOTAL ADJUSTMENTS 1,405 2,947
-------- -------
Net cash provided by operating
activities: 2,484 3,272
-------- -------
CASH FLOWS USED IN INVESTING
ACTIVITIES:
Purchase of marketable securities (3,325) ---
Expenditures for fixed assets (887) (3,599)
-------- -------
Net cash used in investing
activities: (4,212) (3,599)
-------- -------
CASH FLOWS USED IN FINANCING
ACTIVITIES:
Repayments of obligations under
capital lease (46) (54)
-------- -------
NET DECREASE IN CASH AND
CASH EQUIVALENTS (1,774) (381)
CASH AND CASH EQUIVALENTS, beginning
of period 2,293 1,347
-------- -------
CASH AND CASH EQUIVALENTS, end of
period $ 519 $ 966
======== =======
See accompanying notes to Consolidated Condensed Financial Statements.
3
<PAGE>
----------------------------
SYMS CORP AND SUBSIDIARIES
----------------------------
Notes to Consolidated Condensed Financial Statements
April 3, 1993 and April 2, 1994 (Unaudited)
------------------------------------------------------------------------------
Note 1 -- In the opinion of the Company, the accompanying unaudited
consolidated condensed financial statements contain all adjustments
(consisting of only normal recurring adjustments) necessary to
present fairly the financial position as of April 3, 1993 and April
2, 1994 and the results of operations and cash flows for the
thirteen week periods ended April 3, 1993 and April 2, 1994.
While the Company believes that the disclosures presented are
adequate to make the information not misleading, it is suggested
that these consolidated condensed financial statements be read in
conjunction with the consolidated financial statements and notes
included in the Company's Annual Report on Form 10-K for the year
ended January 1, 1994.
Because of the seasonal nature of the Company's business, the
results of the operations for the thirteen week period ended April
2, 1994 is not necessarily indicative of the results for the full
year.
Note 2 -- Inventories at April 3, 1993 and April 2, 1994 have been computed
using a gross profit margin estimated by management.
Note 3 -- The Company adopted Statement of Financial Accounting Standards
(SFAS) No. 109, "Accounting for Income Taxes", effective January 3,
1993. The cumulative effect of adopting SFAS No. 109 on the
Company's financial statements was not material.
4
<PAGE>
----------------------------
SYMS CORP AND SUBSIDIARIES
----------------------------
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
------------------------------------------------------------------------------
RESULTS OF OPERATIONS
Net sales for the thirteen weeks ended April 2, 1994 increased by $1,767,000
or 2.6% when compared with the thirteen weeks ended April 3, 1993. Comparable
store net sales decreased by 5.3%; this was offset by an increase of 7.9%
attributable to five new stores which opened in the fourth quarter of 1993.
The Company's estimated gross margin was 32.0% for the thirteen weeks ended
April 2, 1994 and April 3, 1993.
As a percentage of net sales, operating, general and administrative expenses
(excluding occupancy, depreciation and amortization) were 24.6% for the
thirteen weeks ended April 2, 1994 and 22.9% for the thirteen weeks ended
April 3, 1993. The increase in operating, general and administrative expenses
as a percentage of net sales is attributable to a decrease in comparable store
net sales and additional operating costs associated with the five new stores
opened in 1993.
Operating, general and administrative expenses for the thirteen weeks ended
April 2, 1994 increased by $1,548,000 or 10.1% from the thirteen weeks ended
April 3, 1993. Comparable store operating, general and administrative
expenses increased by $44,000 or .3% and non-comparable stores accounted for
$1,504,000 or 9.8%.
As a percentage of net sales, occupancy expenses were 3.9% for the thirteen
weeks ended April 2, 1994 and 3.3% for the thirteen weeks ended April 3, 1993.
The increase in occupancy expenses as a percentage of net sales can be
attributed to a decrease in comparable store net sales and the additional
occupancy expenses associated with the five new stores opened in 1993.
Income before provision for income taxes was .8% for the thirteen weeks ended
April 2, 1994 and 3.0% for the thirteen weeks ended April 2, 1993. The
decrease in income before provision for income taxes as percentage of net
sales from the preceding period resulted principally from a decrease in
comparable store net sales.
Provision for income taxes, as a percent of income before provision for income
taxes, decreased from 46.0% in 1993 to 43.0% in 1994 principally as a result
of decreases in certain non-tax deductible expenses and the preceding period
included the cumulative effect of adopting SFAS No. 109, "Accounting for
Income Taxes".
LIQUIDITY AND CAPITAL RESOURCES
Working capital decreased to $57,847,000 at April 2, 1994 from $62,993,000 at
April 3, 1993.
Net cash provided by operating activities totaled $3,272,000 in the 1994
period compared to $2,484,000 in the 1993 period. Net income for the thirteen
weeks ended April 2, 1994 amounted to $325,000 compared to $1,079,000 in the
preceding period, a decrease of $754,000. The $11,140,000 increase in
merchandise inventories and the $14,084,000 increase in accounts payable are
primarily due to the addition of five new stores opened during 1993.
Net cash used in investing activities was $3,599,000 in the 1994 period
compared to $4,212,000 in the 1993 period.
Net cash used in financing activities was $54,000 in the 1994 period and
$46,000 in the 1993 period.
The Company declared a cash dividend of five cents per share to shareholders
of record on April 4, 1994 and payable on May 2, 1994.
5
<PAGE>
----------------------------
SYMS CORP AND SUBSIDIARIES
----------------------------
The Company plans to open six stores during 1994. The capital expenditures
historically required to open a Syms store vary based upon whether the Company
leases or purchases the location. The average cost to open a leased location
is approximately $1,100,000 and $4,700,000 for a purchased location. These
costs can vary significantly based upon geographical location, amount of
tenant required improvements and total store square footage. The company has
planned capital expenditures of approximately $18,000,000 for the fiscal year
ended December 31, 1994.
Management believes that existing reserves, internally generated funds and
funds available from the revolving credit agreement will be sufficient for
future working capital and capital expenditure requirements, for new and
existing stores.
6
<PAGE>
----------------------------
SYMS CORP AND SUBSIDIARIES
----------------------------
Part II - Other Information
------------------------------------------------------------------------------
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
NONE
(b) REPORTS ON FORM 8-K
On January 7, 1994, the company filed a report on Form 8-K, dated
December 15, 1993, with respect to the purchase of approximately
7.4 acres of property in Hurst, Texas.
On February 8, 1994, the company filed a report on Form 8-K, dated
December 27, 1993, with respect to a lease with Gateway
Connecticut Properties, for approximately 38,000 square feet in
Berlin, Connecticut.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
SYMS CORP
---------
/s/ ARTHUR WEBER
_____________________________________
CHIEF FINANCIAL OFFICER
May 12, 1994
7
