===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------------------------
FORM 10-Q
----------------------------------
[Mark One]
[ ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended _____________
OR
[X] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For The Transition Period From January 1, 1995 to February 25, 1995
Commission File Number 1-8564
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 February 25, 1995:
17,694,015
===============================================================================
<PAGE>
--------------------------
SYMS CORP AND SUBSIDIARIES
--------------------------
INDEX
-----
PAGE NO.
--------
PART I. Financial Information:
Item 1. Financial Statements
Consolidated Condensed Balanced Sheets -
February 25, 1995 and December 31, 1994 ....................... 1
Consolidated Condensed Statements of Income -
Eight Weeks Ended February 26, 1994 and February 25, 1995 ..... 2
Consolidated Condensed Statements of Cash Flows -
Eight Weeks Ended February 26, 1994 and February 25, 1995 ..... 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)
<TABLE>
<CAPTION>
FEBRUARY 25, DECEMBER
1995 31, 1994
(UNAUDITED) (*)
----------- --------
<S> <C> <C>
ASSETS
Current Assets
Cash and Cash equivalents ........................ $ 457 $ 706
Merchandise inventories (Note 2) ................. 110,260 96,807
Deferred income taxes ............................ 1,316 2,476
Prepaid expenses and other current assets ........ 5,679 5,275
--------- ---------
TOTAL CURRENT ASSETS ........................ 117,712 105,264
PROPERTY AND EQUIPMENT - Net of accumulated
depreciation and amortization .................... 133,654 135,986
DEFERRED INCOME TAXES .............................. 111 --
OTHER ASSETS ....................................... 4,135 4,135
--------- ---------
TOTAL ASSETS ................................ $ 255,612 $ 245,385
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable ................................. $ 35,621 $ 23,399
Accrued expenses ................................. 7,499 7,237
Obligations to customers ......................... 4,761 4,305
Taxes other than income taxes .................... 1,216 1,345
Income taxes payable ............................. 5,576 5,882
Short term borrowings ............................ 2,050 2,900
Current portion of obligations under capital lease 286 278
--------- ---------
TOTAL CURRENT LIABILITIES .................. 57,009 45,346
--------- ---------
OBLIGATIONS UNDER CAPITAL LEASE .................... 1,645 1,696
--------- ---------
DEFERRED INCOME TAXES .............................. -- 1,002
--------- ---------
COMMITMENTS AND CONTINGENT LIABILITIES
SHAREHOLDERS' EQUITY:
Common stock 17,694 shares outstanding on
February 25, 1995 and December 31, 1994,
respectively ................................... 885 885
Additional paid-in capital ....................... 114,709 11,709
Retained earnings ................................ 184,364 184,747
--------- ---------
TOTAL SHAREHOLDERS' EQUITY ................. 196,958 197,341
--------- ---------
TOTAL LIABILITIES AND
SHAREHOLDERS EQUITY ...................... $ 255,612 $ 245,385
========= =========
<FN>
* Condensed from Audited Consolidated Financial Statements.
</FN>
</TABLE>
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)
<TABLE>
<CAPTION>
EIGHT WEEKS ENDED
FEBRUARY 26, FEBRUARY 25,
1994 1995
(UNAUDITED) (UNAUDITED)
----------- ------------
<S> <C> <C>
Net Sales ....................................... $41,642 $46,632
------- -------
Costs and expenses:
Cost of Sales (Note 2) ........................ 28,108 29,776
Operating, general and administrative ......... 10,497 11,228
Special charges (Note 3) ...................... -- 2,935
Occupancy ..................................... 1,702 1,841
Depreciation and amortization ................. 1,190 1,359
Interest - net ................................ 61 60
------- -------
41,558 47,199
------- -------
Income (loss) before provision for (benefit from)
income taxes .................................. 84 (567)
Provision for (benefit from) income taxes ....... 34 (184)
------- -------
Net income (loss) ............................... $ 50 $ (383)
======= =======
Loss per share .................................. $ -- $ (.02)
======= =======
Weighted average shares outstanding ............. 17,692 17,694
======= =======
</TABLE>
See accompanying notes to Consolidated Condensed Financial Statements.
2
<PAGE>
--------------------------
SYMS CORP AND SUBSIDIARIES
--------------------------
Consolidated Condensed Statements of Cash Flows
- -----------------------------------------------
(In Thousands)
<TABLE>
<CAPTION>
EIGHT WEEKS ENDED
FEBRUARY 26, FEBRUARY 25,
1994 1995
(UNAUDITED) (UNAUDITED)
----------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash provided by operating activities ..... $3,416 $1,019
------ ------
CASH FLOWS USED IN INVESTING ACTIVITIES:
Expenditures for property and equipment ....... (1,910) (388)
Proceeds from sale of property and equipment .. -- 13
------ ------
Net cash used in investing activities ......... (1,910) (375)
------ ------
CASH FLOWS USED IN FINANCING ACTIVITIES:
Repayment of short term borrowing ............. -- (850)
Repayments of obligations under capital lease (36) (43)
------ ------
Net cash used in financing activities ......... (36) (893)
------ ------
NET INCREASE/DECREASE IN CASH AND
CASH EQUIVALENTS .............................. 1,470 (249)
CASH AND CASH EQUIVALENTS, beginning of period .. 1,347 706
------ ------
CASH AND CASH EQUIVALENTS, end of period ........ $2,817 $ 457
====== ======
</TABLE>
See accompanying notes to Consolidated Condensed Financial Statements.
3
<PAGE>
--------------------------
SYMS CORP AND SUBSIDIARIES
--------------------------
Notes to Consolidated Condensed Financial Statements
February 26, 1994 and February 25, 1995 (Unaudited)
- ---------------------------------------------------
Note 1 - The Company has changed its fiscal year end to the Saturday closest
to the end of February. This interim report reflects the two month
period between the prior fiscal year ended December 31, 1994, and the
new fiscal year commencing February 26, 1995.
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 February 26, 1994 and February 25, 1995 and
the results of operations and cash flows for the eight week periods
ended February 26, 1994 and February 25, 1995.
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 December 31,
1994.
Because of the seasonal nature of the Company's business, the results
of the operations for the eight week period ended February 25, 1995 is
not necessarily indicative of the results for a full year.
Note 2 - Inventory at February 26, 1994 was computed using a gross profit
margin estimated by management. Commencing January 1, 1995, the Company
implemented a retail stock ledger which enabled it to determine its
interim inventory and gross margin based upon the retail method of
accounting.
Note 3 - Special charges consist of the following:
Store close down costs .......................... $1,608,000
Write-off of pre-development
costs and lease abandonment costs ............. $1,327,000
----------
$2,935,000
==========
4
<PAGE>
--------------------------
SYMS CORP AND SUBSIDIARIES
--------------------------
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
- --------------------------------------------------------------------
RESULTS OF OPERATIONS
The Company has changed its fiscal year end from December to February. The
results reported compare the interim period from January 1, 1995 to February 25,
1995 with the prior January 2, 1994 to February 26, 1994.
Net sales for the eight weeks ended February 25, 1995 increased by $4,990,000 or
12.0% when compared with the eight weeks ended February 26, 1994. Comparable
store net sales increased by $2,098,000 or 5.5%. This was augmented by an
increase of $2,892,000 for stores opened less than one year.
The gross margin for the eight weeks ended February 25, 1995 was 36.1% compared
with 32.5% for the prior period. The prior period's gross margin was estimated
by management. Commencing January 1, 1995, the Company implemented a retail
stock ledger which enabled it to determine its interim inventory and gross
margin based upon the retail method of accounting.
As a percentage to net sales, operating, general and administrative expenses
(excluding occupancy, depreciation and amortization) were 24.1% for the eight
weeks ended February 25, 1995 and 25.2% for the eight weeks ended February 26,
1994. The decrease in operating, general and administrative expenses as a
percentage to sales is attributable to an increase in net sales.
As a percentage of net sales, occupancy expenses were 4.0% for the eight weeks
ended February 25, 1995 and 4.1% for the eight weeks ended February 26, 1994.
Loss before the benefit from income taxes was $567,000 or 1.0% of net sales for
the eight weeks ended February 25, 1995, compared with income before the
provision for income taxes of $84,000 for the eight weeks ended February 26,
1994. The decrease in net income before the provision for taxes was attributable
to the special charges, offset by the increase in net sales and a higher gross
margin. The special charges include costs associated with the close down of the
Hoffman, Illinois store, write-off of costs associated with a lease in
Cincinnati, Ohio in which the Company has decided not to open a store and
write-off of pre-development costs associated with property located in Roseland,
New Jersey.
Provision for income taxes, as a percentage of income before provision for
income taxes, reflected a benefit of 32.4% for the transition period ended
February 25,1995, and an expense of 40.5% for the prior period ended February
26, 1994. The current period includes a benefit of federal and state income
taxes offset by certain other state income taxes.
LIQUIDITY AND CAPITAL RESOURCES
Working capital at February 25, 1995 was $60,703,000.
Net cash provided by operating activities totaled $1,019,000 in the 1995 period
compared to $3,416,000 in the 1994 period. Net loss for the eight weeks ended
February 25, 1995 totaled $383,000 compared with income of $50,000 in the prior
period.
Net cash used in investing activities was $375,000 in the 1995 period compared
to $1,910,000 in the 1994 period, primarily due to expenditures for property and
equipment in both periods.
Net cash used in financing activities was $893,000 in the 1995 period compared
to $36,000 in the 1994 period. The increase in the 1995 period was due to
repayment of short term borrowings.
5
<PAGE>
--------------------------
SYMS CORP AND SUBSIDIARIES
--------------------------
The Company has planned capital expenditures of approximately $15,000,000 in
1995.
Management believes that existing resources, internally generated funds and
funds available from the revolving credit agreement will be sufficient for
future working capital and capital expenditure requirements.
6
<PAGE>
--------------------------
SYMS CORP AND SUBSIDIARIES
--------------------------
Part II - Other Information
- -----------------------------
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
Exhibit 27 - Financial Data Schedule
(b) REPORTS ON FORM 8-K
On March 22, 1995 the Company filed a report on Form 8-K as
amended on March 31, 1995 with respect to the determination to
change the Company's fiscal year end to the Saturday closest
to the end of February. The date of the event reported (under
Item 8 of Form 8-K) was March 17, 1995.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to by signed on its behalf by the
undersigned thereunto duly authorized.
SYMS CORP
---------
/s/ HARRY C. KLEINMAN
--------------------------------------
Chief Financial Officer
/s/ SY SYMS
--------------------------------------
Chairman of the Board, Chief Executive
Officer
April 28, 1995
7
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 2-MOS
<FISCAL-YEAR-END> FEB-25-1995
<PERIOD-END> FEB-25-1995
<CASH> 457
<SECURITIES> 0
<RECEIVABLES> 659
<ALLOWANCES> 0
<INVENTORY> 110,260
<CURRENT-ASSETS> 117,712
<PP&E> 190,962
<DEPRECIATION> 57,308
<TOTAL-ASSETS> 255,612
<CURRENT-LIABILITIES> 57,009
<BONDS> 1,645
<COMMON> 885
0
0
<OTHER-SE> 196,073
<TOTAL-LIABILITY-AND-EQUITY> 255,612
<SALES> 46,632
<TOTAL-REVENUES> 46,632
<CGS> 29,776
<TOTAL-COSTS> 29,776
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 60
<INCOME-PRETAX> (567)
<INCOME-TAX> (184)
<INCOME-CONTINUING> (383)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (383)
<EPS-PRIMARY> (.02)
<EPS-DILUTED> (.02)
</TABLE>
