<PAGE>
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 November 2, 1996
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. 1-3381
------
The Pep Boys - Manny, Moe & Jack
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Pennsylvania 23-0962915
------------------------------- ---------------------------
(State or other jurisdiction of (I.R.S. Employer ID number)
incorporation or organization)
3111 W. Allegheny Ave. Philadelphia, PA 19132
---------------------------------------- ----------
(Address of principal executive offices) (Zip code)
215-229-9000
----------------------------------------------------
(Registrant's telephone number, including area code)
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 and 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 ( )
As of November 2, 1996 there were 62,786,536 shares of the registrant's
Common Stock outstanding.
<PAGE>
<PAGE>2
- -------------------------------------------------------------------
Index Page
- -------------------------------------------------------------------
PART I - FINANCIAL INFORMATION
- ------------------------------
Item 1. Condensed Consolidated
Financial Statements (Unaudited)
Consolidated Balance Sheets -
November 2, 1996 and February 3, 1996 3
Consolidated Statements of Earnings -
Thirteen and Thirty-nine weeks ended
November 2, 1996 and October 28, 1995 4
Condensed Consolidated Statements of
Cash Flows - Thirty-nine weeks ended
November 2, 1996 and October 28, 1995 5
Notes to Condensed Consolidated
Financial Statements 6
Management's Discussion and Analysis
of Financial Condition and Results of
Operations 7-11
PART II - OTHER INFORMATION 12
- ---------------------------
SIGNATURE 13
- -------------------------------------------------------------------
<PAGE>
<PAGE>3
<TABLE>
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(dollar amounts in thousands, except per share amounts)
<CAPTION>
November 2, 1996 February 3, 1996*
------------- -----------------
(Unaudited)
<S> <C> <C>
ASSETS
Current Assets:
Cash....................................................... $ 27,340 $ 11,487
Accounts receivable, net................................... 5,339 4,832
Merchandise inventories.................................... 462,443 417,852
Deferred income taxes...................................... 16,281 16,338
Other...................................................... 25,670 15,964
------------- -------------
Total Current Assets.................................... 537,073 466,473
Property and Equipment - at cost
Land....................................................... 257,820 243,738
Building and improvements.................................. 748,568 695,029
Furniture, fixtures and equipment.......................... 410,354 356,605
Construction in progress................................... 23,417 12,431
------------ -------------
1,440,159 1,307,803
Less accumulated depreciation and amortization............. 337,567 293,751
------------- -------------
Total Property and Equipment............................ 1,102,592 1,014,052
Other........................................................ 22,642 19,483
------------- -------------
Total Assets.................................................. $1,662,307 $1,500,008
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable........................................... $ 196,191 $ 222,524
Accrued expenses........................................... 112,724 95,875
Income taxes payable....................................... 9,838 -
Current maturities of long-term debt....................... 143 108,206
------------- -------------
Total Current Liabilities............................... 318,896 426,605
Long-Term Debt, less current maturities...................... 317,108 280,793
Deferred Income Taxes........................................ 40,925 40,900
Convertible Subordinated Notes............................... 86,250 86,250
Zero Coupon Convertible Subordinated Notes................... 150,729 -
Commitments and Contingencies
Stockholders' Equity:
Common Stock, par value $1 per share:
Authorized 500,000,000 shares - Issued and
outstanding 62,786,536 and 62,084,021..................... 62,787 62,084
Additional paid-in capital................................. 152,800 139,202
Retained earnings.......................................... 593,081 524,443
------------- ------------
808,668 725,729
Less:
Shares held in benefits trust, 2,232,500 shares, at cost. 60,269 60,269
------------- ------------
Total Stockholders' Equity.............................. 748,399 665,460
------------- ------------
Total Liabilities and Stockholders' Equity.................... $1,662,307 $1,500,008
============= ============
<FN>
See notes to condensed consolidated financial statements.
*Taken from the audited financial statements at February 3, 1996.
/TABLE
<PAGE>
<PAGE>4
<TABLE>
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(dollar amounts in thousands, except per share amounts)
UNAUDITED
<CAPTION>
Thirteen weeks ended Thirty-nine weeks ended
------------------------------------ ------------------------------------
November 2, 1996 October 28, 1995 November 2, 1996 October 28, 1995
---------------- --------------- ---------------- -------------
<S> <C> <C> <C> <C>
Merchandise Sales.................................... $ 408,670 $ 350,473 $ 1,178,644 $ 1,007,589
Service Revenue...................................... 70,149 61,314 205,462 176,245
------------- ------------- ------------- -------------
Total Revenues....................................... 478,819 411,787 1,384,106 1,183,834
Costs of Merchandise Sales........................... 284,029 245,826 819,393 705,912
Costs of Service Revenue............................. 56,503 49,987 163,704 141,818
------------- ------------- ------------- -------------
Total Costs of Revenues.............................. 340,532 295,813 983,097 847,730
Gross Profit from Merchandise Sales.................. 124,641 104,647 359,251 301,677
Gross Profit from Service Revenue.................... 13,646 11,327 41,758 34,427
------------- ------------- ------------- -------------
Total Gross Profit................................... 138,287 115,974 401,009 336,104
Selling, General and Administrative Expenses......... 88,178 74,512 255,973 214,070
------------- ------------- ------------- -------------
Operating Profit..................................... 50,109 41,462 145,036 122,034
Nonoperating Income.................................. 925 457 1,872 1,605
Interest Expense..................................... 6,943 7,758 22,895 23,441
------------- ------------- ------------- ------------
Earnings Before Income Taxes......................... 44,091 34,161 124,013 100,198
Income Taxes......................................... 16,314 12,725 45,885 37,324
------------- ------------- ------------- ------------
Net Earnings......................................... 27,777 21,436 78,128 62,874
Retained Earnings, beginning of period............... 568,483 489,964 524,443 454,288
Cash Dividends....................................... 3,179 2,735 9,490 8,497
------------ ------------- ------------ -------------
Retained Earnings, end of period..................... $ 593,081 $ 508,665 $ 593,081 $ 508,665
============ ============= ============ =============
Earnings per Share................................... $ .44 $ .35 $ 1.26 $ 1.03
============ ============= ============ =============
Cash Dividends per Share............................. $ .0525 $ .0475 $ .1575 $ .1425
============ ============= ============ =============
<FN>
See notes to condensed consolidated financial statements.
</TABLE>
<PAGE>
<PAGE>5
<TABLE>
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollar amounts in thousands)
UNAUDITED
<CAPTION>
Thirty-nine weeks ended
------------------------------------
November 2, 1996 October 28, 1995
---------------- ----------------
<S> <C> <C>
Net Cash Provided by Operating Activities....................... $ 73,182 $ 152,135
Cash Flows from Investing Activities:
Capital expenditures............................................ (137,618) (132,933)
Other, net...................................................... 1,283 94
------------ ------------
Net Cash Used in Investing Activities........................... (136,335) (132,839)
Cash Flows from Financing Activities:
Net borrowings (payments) under line of credit agreements....... 35,086 (89,200)
Reduction of long-term debt..................................... (107,141) (19,775)
Dividends paid.................................................. (9,490) (8,497)
Proceeds from exercise of stock options
and dividend reinvestment plan................................ 14,301 4,490
Net proceeds from issuance of notes............................. 146,250 98,992
------------ -----------
Net Cash Provided by (Used in) Financing Activities............. 79,006 (13,990)
------------ -----------
Net Increase in Cash................................................. 15,853 5,306
Cash at Beginning of Year............................................ 11,487 11,748
------------ -----------
Cash at End of Period................................................ $ 27,340 $ 17,054
============ ===========
<FN>
See notes to condensed consolidated financial statements.
</TABLE>
<PAGE>
<PAGE>6
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. Condensed Consolidated Financial Statements
The consolidated balance sheet as of November 2, 1996, the consolidated
statements of earnings for the thirteen and thirty-nine week periods ended
November 2, 1996 and October 28, 1995 and the condensed consolidated
statements of cash flows for the thirty-nine week periods ended November 2,
1996 and October 28, 1995 have been prepared by the Company without audit.
In the opinion of management, all adjustments (which include only normal
recurring adjustments) necessary to present fairly the financial position,
results of operations and cash flows at November 2, 1996 and for all periods
presented have been made.
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 February 3,
1996 annual report to shareholders. The results of operations for the
thirteen and thirty-nine week periods ended November 2, 1996 are not
necessarily indicative of the operating results for the full year.
NOTE 2. Merchandise Inventories
Merchandise inventories are valued at the lower of cost (last-in, first-out)
or market. If the first-in, first-out method of valuing inventories had been
used by the Company, inventories would have been approximately $6,491,000 and
$10,491,000 higher at November 2, 1996 and February 3, 1996, respectively.
NOTE 3. Accounting for Stock Based Compensation
In October 1995, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards (SFAS) No. 123, "Accounting for Stock-Based
Compensation," which was effective for the Company beginning February 4,
1996. SFAS No. 123 requires expanded disclosures of stock-based compensation
arrangements with employees and encourages (but does not require)
compensation cost to be measured based on the fair value of the equity
instrument awarded. Companies are permitted, however, to continue to apply
APB Opinion No. 25, which recognizes compensation cost based on the intrinsic
value of the equity instrument awarded. The Company will continue to apply
APB Opinion No. 25 to measure its stock based compensation awards to
employees and will disclose the required pro forma effect on net income in
the fiscal year ended February 1, 1997 financial statements.
NOTE 4. Impairment of Long-Lived Assets
Effective February 4, 1996, the Company adopted SFAS No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed
Of." 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 identifiable intangibles to be disposed of should be reported at the
lower of carrying amount or fair value less cost to sell. This new standard
had no impact on the Company's financial position or results of operations.
NOTE 5. Long-term Debt
On September 20, 1996 the Company received net proceeds of $146,250,112
from the issuance of zero coupon subordinated Liquid Yield Option Notes
due 2011 (the "LYONs") which have an aggregate principal amount at maturity
of $271,704,000. The LYONs were issued at a discount representing a yield
to maturity of 4.0 percent, and are redeemable, at the Company's option, at
any time on or after September 20, 2001. The LYONs are redeemable at the
option of the holders on September 20, 2001 and September 20, 2006. At the
holders' option, each $1,000 principle amount at maturity of LYONs is
convertible, at any time, into 12.929 shares of the Company's common stock
subject to adjustment in certain events.
<PAGE>
<PAGE>7
<TABLE>
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
THIRTEEN WEEKS ENDED NOVEMBER 2, 1996
Results of Operations -
The following table presents for the periods indicated certain items in the consolidated statements of earnings as a
percentage of total revenues (except as otherwise provided) and the percentage change in dollar amounts of such items
compared to the indicated prior period.
<CAPTION>
Percentage of Total Revenues Percentage Change
- ------------------------------------------------------ ---------------------------------- -----------------
Thirteen weeks ended November 2, 1996 October 28, 1995 Fiscal 1996 vs.
(Fiscal 1996) (Fiscal 1995) Fiscal 1995
- ------------------------------------------------------ -------------- ------------- -----------------
<S> <C> <C> <C>
Merchandise Sales..................................... 85.3% 85.1% 16.6%
Service Revenue (1)................................... 14.7 14.9 14.4
------ ------ ------
Total Revenues........................................ 100.0 100.0 16.3
Costs of Merchandise Sales (2)........................ 69.5 (3) 70.1 (3) 15.5
Costs of Service Revenue (2).......................... 80.5 (3) 81.5 (3) 13.0
------ ------ ------
Total Costs of Revenues............................... 71.1 71.8 15.1
Gross Profit from Merchandise Sales................... 30.5 (3) 29.9 (3) 19.1
Gross Profit from Service Revenue..................... 19.5 (3) 18.5 (3) 20.5
------ ------ ------
Total Gross Profit.................................... 28.9 28.2 19.2
Selling, General and Administrative Expenses.......... 18.4 18.1 18.3
------ ------ ------
Operating Profit...................................... 10.5 10.1 20.9
Nonoperating Income................................... .2 .1 102.4
Interest Expense...................................... 1.5 1.9 (10.5)
------ ------ ------
Earnings Before Income Taxes.......................... 9.2 8.3 29.1
Income Taxes.......................................... 37.0 (4) 37.3 (4) 28.2
------ ------ ------
Net Earnings.......................................... 5.8 5.2 29.6
====== ====== ======
<FN>
(1) Service revenue consists of the labor charge for installing merchandise or maintaining or repairing vehicles, excluding the sale
of any installed parts or materials.
(2) Costs of merchandise sales include the cost of products sold, buying, warehousing and store occupancy costs. Costs of service
revenue include service center payroll and related employee benefits and service center occupancy costs. Occupancy costs include
utilities, rents, real estate and property taxes, repairs and maintenance and depreciation and amortization expenses.
(3) As a percentage of related sales or revenue, as applicable.
(4) As a percentage of earnings before income taxes.
</TABLE>
<PAGE>
<PAGE>8
Thirteen Weeks Ended November 2, 1996 vs. Thirteen Weeks Ended October 28,
1995
- ------------------------------------------------------------------------
Total revenues for the third quarter increased 16% due to a higher store
count (561 at November 2, 1996 compared with 472 at October 28, 1995) coupled
with a 5% increase in comparable store revenues (revenues generated by stores
in operation during the same months of each period). Comparable store
merchandise sales increased 5% while comparable service revenue increased 6%.
Gross profit from merchandise sales increased, as a percentage of merchandise
sales, due primarily to higher merchandise margins offset, in part, by an
increase in store occupancy costs.
Selling, general and administrative expenses increased, as a percentage of
total revenues, due primarily to an increase in general office costs.
<TABLE>
Nonoperating income consisted of the following:
(in thousands)
<CAPTION>
1996 1995
------ ------
<S> <C> <C>
Rental revenue $ 275 $ 358
Investment income 625 79
Other income 25 20
------ ------
Total $ 925 $ 457
====== ======
</TABLE>
Interest expense decreased, as a percentage of total revenues, due mainly to
spreading lower interest costs over higher sales volume.
Net earnings increased, as a percentage of total revenues, due to an increase
in comparable store sales coupled with an increase, as a percentage of
merchandise sales, in gross profit from merchandise sales, and a decrease, as
a percentage of total revenues, in interest expense offset, in part, by an
increase, as a percentage of total revenues, in selling, general and
administrative expenses.<PAGE>
<PAGE>9
<TABLE>
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
THIRTY-NINE WEEKS ENDED NOVEMBER 2, 1996
Results of Operations -
The following table presents for the periods indicated certain items in the consolidated statements of earnings as a
percentage of total revenues (except as otherwise provided) and the percentage change in dollar amounts of such items
compared to the indicated prior period.
<CAPTION>
Percentage of Total Revenues Percentage Change
- ------------------------------------------------------ ---------------------------------- -----------------
Thirty-nine weeks ended November 2, 1996 October 28, 1995 Fiscal 1996 vs.
(Fiscal 1996) (Fiscal 1995) Fiscal 1995
- ------------------------------------------------------ -------------- ------------- -----------------
<S> <C> <C> <C>
Merchandise Sales..................................... 85.2% 85.1% 17.0%
Service Revenue (1)................................... 14.8 14.9 16.6
------- ------- -------
Total Revenues........................................ 100.0 100.0 16.9
Costs of Merchandise Sales (2)........................ 69.5 (3) 70.1 (3) 16.1
Costs of Service Revenue (2).......................... 79.7 (3) 80.5 (3) 15.4
------ ------ ------
Total Costs of Revenues............................... 71.0 71.6 16.0
Gross Profit from Merchandise Sales................... 30.5 (3) 29.9 (3) 19.1
Gross Profit from Service Revenue..................... 20.3 (3) 19.5 (3) 21.3
------ ------ ------
Total Gross Profit.................................... 29.0 28.4 19.3
Selling, General and Administrative Expenses.......... 18.5 18.0 19.6
------ ------ ------
Operating Profit...................................... 10.5 10.4 18.8
Nonoperating Income................................... .1 .1 16.6
Interest Expense...................................... 1.6 2.0 (2.3)
------ ------ ------
Earnings Before Income Taxes.......................... 9.0 8.5 23.8
Income Taxes.......................................... 37.0 (4) 37.3 (4) 22.9
------ ------ ------
Net Earnings.......................................... 5.6 5.3 24.3
====== ====== ======
<FN>
(1) Service revenue consists of the labor charge for installing merchandise or maintaining or repairing vehicles, excluding the sale
of any installed parts or materials.
(2) Costs of merchandise sales include the cost of products sold, buying, warehousing and store occupancy costs. Costs of service
revenue include service center payroll and related employee benefits and service center occupancy costs. Occupancy costs include
utilities, rents, real estate and property taxes, repairs and maintenance and depreciation and amortization expenses.
(3) As a percentage of related sales or revenue, as applicable.
(4) As a percentage of earnings before income taxes.
</TABLE>
<PAGE>
<PAGE>10
Thirty-nine Weeks Ended November 2, 1996 vs. Thirty-nine Weeks Ended October
28, 1995
- -----------------------------------------------------------------------------
Total revenues increased 17% due to a higher store count (561 at November 2,
1996 compared with 472 at October 28, 1995) coupled with a 4% increase in
comparable store revenues. Comparable store merchandise sales increased 4%
while comparable service revenue increased 6%.
Gross profit from merchandise sales increased, as a percentage of merchandise
sales, due primarily to higher merchandise margins coupled with a slight
decrease in warehousing costs offset, in part, by an increase in store
occupancy costs.
Gross profit from service revenue increased, as a percentage of service
revenue, due primarily to decreases in service personnel and service center
occupancy costs.
Selling, general and administrative expenses increased, as a percentage of
total revenues, due primarily to increases in general office costs coupled
with a slight increase in employee benefits costs.
<TABLE>
Nonoperating income consisted of the following:
(in thousands)
<CAPTION>
1996 1995
------ ------
<S> <C> <C>
Rental revenue $1,082 $1,368
Investment income 754 156
Other income 36 81
------ ------
Total $1,872 $1,605
====== ======
</TABLE>
Interest expense decreased, as a percentage of total revenues, due mainly to
spreading slightly lower costs over higher sales volume.
Net earnings increased, as a percentage of total revenues, due to an increase
in comparable store sales coupled with increases, as a percentage of related
sales and revenues, in gross profit from merchandise sales and gross profit
from service revenue, and a decrease, as a percentage of total revenues, in
interest expense offset, in part, by an increase, as a percentage of total
revenues, in selling, general and administrative expenses.
<PAGE>
<PAGE>11
LIQUIDITY AND CAPITAL RESOURCES - NOVEMBER 2, 1996
- ----------------------------------------------
The Company's cash requirements arise principally from the need to finance
the acquisition, construction and equipping of new stores and to purchase
inventory. During the first thirty-nine weeks of 1996, the Company invested
$137,618,000 in property and equipment while net inventory (inventory less
accounts payable) increased $70,924,000. Working capital increased from
$39,868,000 at February 3, 1996 to $218,177,000 at November 2, 1996. At
November 2, 1996 the Company had stockholders' equity of $748,399,000 and
long-term debt of $554,087,000. The Company's long-term debt was 43% of its
total capitalization at November 2, 1996 and 36% at February 3, 1996.
The Company plans to open approximately 43 new stores during the balance of
the current fiscal year. Management estimates that the cost of this
expansion, coupled with expenditures in existing stores, warehouses and
offices will be approximately $63,000,000. Funds required to finance the
store expansion including related inventory requirements are expected to come
primarily from operating activities with the remainder provided by unused
lines of credit which totalled $238,800,000 at November 2, 1996, or from
accessing traditional lending sources such as the public capital markets.
On September 20, 1996 the Company sold zero coupon convertible notes due
September 20, 2011 having a maturity value of $271,704,000. The net proceeds
of $146,250,112 were used to repay the Company's short-term variable-rate
bank debt and portions of the Company's long-term variable-rate bank debt and
for general corporate purposes.
In October 1995, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards (SFAS) No. 123, "Accounting for Stock-Based
Compensation," which was effective for the Company beginning February 4,
1996. SFAS No. 123 requires expanded disclosures of stock-based compensation
arrangements with employees and encourages (but does not require)
compensation cost to be measured based on the fair value of the equity
instrument awarded. Companies are permitted, however, to continue to apply
APB Opinion No. 25, which recognizes compensation cost based on the intrinsic
value of the equity instrument awarded. The Company will continue to apply
APB Opinion No. 25 to measure its stock based compensation awards to
employees and will disclose the required pro forma effect on net income in
the fiscal year ended February 1, 1997 financial statements.
Effective February 4, 1996, the Company adopted SFAS No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed
Of." 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 identifiable intangibles to be disposed of should be reported at the
lower of carrying amount or fair value less cost to sell. This new standard
had no impact on the Company's financial position or results of operations.
<PAGE>
<PAGE>12
PART II - OTHER INFORMATION
- ---------------------------
Item 1. Legal Proceedings
The Company is a defendant in a purported class action entitled
"Brian Lee, Anthony Baxton, and Harry Schlein v. The Pep Boys -
Manny, Moe & Jack," Civil Action No. 96-0652-CB, United States
District Court for the Southern District of Alabama, Southern
Division. This action was originally filed on or about May 21,
1996 in the Circuit Court of Mobile county, Alabama. The
Company has since removed the case to federal court, and the
plaintiffs have filed a motion to remand the case back to
Alabama state court. The Company has also moved to dismiss the
case for failure to state a claim. The Plaintiff's motion to
remand is pending before the federal District Court. In their
complaint, the plaintiffs allege that the Company sold used
automotive batteries to consumers as if those batteries were
new. The complaint purports to state causes of action for fraud
and deceit, negligent misrepresentation, breach of contract and
violation of state consumer protection statutes. The plaintiffs
are seeking compensatory and punitive damages, as well as
injunctive and equitable relief. The company believes the
claims are without merit and intends to vigorously defend this
action.
Item 2. Changes in Securities
None.
Item 3. Defaults upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
(11) Statement Re: Computation of Earnings Per Share
(27) Financial Data Schedules
(b) Reports on Form 8-K. No reports on Form 8-K have been filed
during the quarter for which this report is filed.
<PAGE>
<PAGE>13
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.
THE PEP BOYS - MANNY, MOE & JACK
--------------------------------
(Registrant)
Date: December 16, 1996 By: /s/ Michael J. Holden
----------------------- -------------------------
Michael J. Holden
Executive Vice President,
Chief Financial Officer
<PAGE>
<PAGE>15
INDEX TO EXHIBITS
- -----------------
(11) Computation of Earnings Per Share
(27) Financial Data Schedule
<TABLE>
THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES Exhibit 11
COMPUTATION OF EARNINGS PER SHARE
(in thousands, except per share data)
<CAPTION>
Thirteen weeks ended Thirty-nine weeks ended
------------------------------------- ------------------------------------
November 2, 1996 October 28, 1995 November 2, 1996 October 28, 1995
----------------- ------------------ ---------------- ----------------
<S> <C> <C> <C> <C>
Net Earnings..................................... $27,777 $21,436 $78,128 $62,874
Adjustment for interest on 4% convertible
subordinated notes, net of income tax effect... 542 - 1,626 1,619
Adjustment for interest on zero coupon
convertible subordinated notes, net of
income tax effect.............................. 462 - 462 -
------------- -------------- ------------- ------------
(a) Adjusted Net Earnings............................ $28,781 $21,436 $80,216 $64,493
============= ============== ============= ============
Average number of common shares outstanding
during the period.............................. 60,385 59,794 60,145 59,503
Common shares assumed issued upon conversion of
4% convertible subordinated notes.............. 2,104 - 2,104 2,104
Common shares assumed issued upon conversion of
zero coupon convertible subordinated notes..... 1,699 - 566 -
Common shares assumed issued upon exercise
of dilutive stock options, net of assumed
repurchase, at the average market price,
using the treasury stock method (1)............ 958 764 937 970
------------- ------------- ------------ ------------
(b) Average number of common shares assumed
outstanding during the period.................. 65,146 60,558 63,752 62,577
============= ============= ============ ============
Net Earnings (a/b)............................... $ .44 $ .35 $ 1.26 $ 1.03
============ ============= =========== ============
<FN>
(1) The number of common shares assumed issued upon exercise of dilutive stock options is essentially the same for fully diluted
earnings per share.
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED BALANCE
SHEET AS OF NOVEMBER 2, 1996 AND THE CONSOLIDATED STATEMENT OF EARNINGS FOR THE THIRTY-NINE
WEEK PERIOD ENDED NOVEMBER 2, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> FEB-1-1997
<PERIOD-END> NOV-2-1996
<CASH> 27,340
<SECURITIES> 0
<RECEIVABLES> 5,625
<ALLOWANCES> 286
<INVENTORY> 462,443
<CURRENT-ASSETS> 537,073
<PP&E> 1,440,159
<DEPRECIATION> 337,567
<TOTAL-ASSETS> 1,662,307
<CURRENT-LIABILITIES> 318,896
<BONDS> 554,087
0
0
<COMMON> 62,787
<OTHER-SE> 685,612
<TOTAL-LIABILITY-AND-EQUITY> 1,662,307
<SALES> 1,178,644
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<INCOME-TAX> 45,885
<INCOME-CONTINUING> 78,128
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