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 June 28, 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 Number: 0-16002
ADVANCED MARKETING SERVICES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 95-3768341
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5880 Oberlin Drive, Suite 400
San Diego, California 92121
(Address of principal executive offices)
(Zip Code)
Registrant's telephone number: (619) 457-2500
Not Applicable
(Former name, former address and former fiscal year, if changed
since last report)
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 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 outstanding as of July 31,
1997 was 5,541,309.
ADVANCED MARKETING SERVICES, INC.
Quarterly Report on Form 10-Q
June 28, 1997
INDEX
Page
Number
PART I. FINANCIAL INFORMATION
Item 1. CONSOLIDATED FINANCIAL STATEMENTS
Consolidated Balance Sheets
June 28, 1997 (Unaudited), March 31, 1997 and
June 29, 1996 (Unaudited) 3 - 4
Consolidated Statements of Income (Unaudited)
Three months ended June 28, 1997 and
June 29, 1996 5
Consolidated Statements of Cash Flows (Unaudited)
Three months ended June 28, 1997 and
June 29, 1996 6
Notes to Consolidated Financial Statements 7 - 9
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 10-11
PART II. OTHER INFORMATION 12
SIGNATURES 12
Page 2 of 12
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (See Note 1 for basis of presentation)
<TABLE>
ADVANCED MARKETING SERVICES, INC.
CONSOLIDATED BALANCE SHEETS
ASSETS
AS OF
JUNE 28, MARCH 31, JUNE 29,
1997 1997 1996
(UNAUDITED) (UNAUDITED)
(IN THOUSANDS)
<S> <C> <C> <C>
CURRENT ASSETS:
CASH AND CASH EQUIVALENTS $ 19,819 $ 13,592 $ 490
INVESTMENTS, AVAILABLE-FOR-SALE 2,852 9,177 14,870
ACCOUNTS RECEIVABLE - TRADE, NET OF
ALLOWANCES FOR UNCOLLECTIBLE ACCOUNTS
AND SALES RETURNS OF $3,832,000 AT JUNE
28, 1997, $3,782,000 AT MARCH 31, 1997
AND $4,152,000 AT JUNE 29, 1996 46,233 53,564 63,032
VENDOR AND OTHER RECEIVABLES 2,558 2,801 1,369
INVENTORIES, NET 84,859 91,745 82,971
DEFERRED INCOME TAXES 4,758 5,482 5,533
PREPAID EXPENSES 971 809 586
TOTAL CURRENT ASSETS 162,050 177,170 168,851
PROPERTY AND EQUIPMENT, AT COST 9,378 9,206 8,486
LESS - ACCUMULATED DEPRECIATION AND
AMORTIZATION 5,703 5,445 5,018
NET PROPERTY AND EQUIPMENT 3,675 3,761 3,468
INVESTMENTS, AVAILABLE-FOR-SALE 3,108 2,063 915
OTHER ASSETS 1,356 507 610
TOTAL ASSETS $170,189 $183,501 $173,844
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED BALANCE SHEETS
Page 3 of 12
<TABLE>
ADVANCED MARKETING SERVICES, INC.
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS' EQUITY
AS OF
JUNE 28, MARCH 31, JUNE 29,
1997 1997 1996
(UNAUDITED) (UNAUDITED)
(IN THOUSANDS EXCEPT SHARE DATA)
<S> <C> <C> <C>
CURRENT LIABILITIES:
ACCOUNTS PAYABLE $105,002 $119,507 $116,085
ACCRUED LIABILITIES 5,080 5,318 4,156
INCOME TAXES PAYABLE 919 889 1,377
TOTAL CURRENT LIABILITIES 111,001 125,714 121,618
STOCKHOLDERS' EQUITY:
COMMON STOCK, $.001 PAR VALUE, AUTHORIZED
20,000,000 SHARES, ISSUED 6,233,000 SHARES
AT JUNE 28, 1997, 6,228,000 SHARES AT MARCH
31, 1997 AND 6,178,000 SHARES AT JUNE 29, 1996 6 6 6
ADDITIONAL PAID IN CAPITAL 26,351 26,319 26,004
RETAINED EARNINGS 34,984 33,569 28,340
UNREALIZED GAIN ON INVESTMENTS 47 9 --
FOREIGN CURRENCY TRANSLATION ADJUSTMENT (80) (86) (94)
LESS: TREASURY STOCK, 718,000 SHARES AT JUNE
28, 1997 AND 708,000 SHARES AT MARCH 31,
1997 AND JUNE 29, 1996, AT COST (2,120) (2,030) (2,030)
TOTAL STOCKHOLDERS' EQUITY 59,188 57,787 52,226
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $170,189 $183,501 $173,844
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED BALANCE
SHEETS.
Page 4 of 12
<TABLE>
ADVANCED MARKETING SERVICES, INC.
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED
JUNE 28, JUNE 29,
1997 1996
<S> <C> <C>
NET SALES $ 82,080 $ 97,797
COST OF GOOD SOLD 72,378 88,612
GROSS PROFIT 9,702 9,185
DISTRIBUTION AND ADMINISTRATIVE EXPENSES 7,815 7,481
INCOME FROM OPERATIONS 1,887 1,704
INTEREST AND DIVIDEND INCOME, NET 353 234
INCOME BEFORE PROVISION FOR INCOME TAXES 2,240 1,938
PROVISION FOR INCOME TAXES 825 711
NET INCOME $ 1,415 $ 1,227
NET INCOME PER COMMON AND COMMON SHARE
EQUIVALENT:
PRIMARY $ .25 $ .21
FULLY DILUTED $ .25 $ .21
WEIGHTED AVERAGE NUMBER OF SHARES:
PRIMARY 5,702 5,746
FULLY DILUTED 5,704 5,749
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED STATEMENTS.
Page 5 of 12
<TABLE>
ADVANCED MARKETING SERVICES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(IN THOUSANDS)
THREE MONTHS ENDED
JUNE 28, JUNE 29,
1997 1996
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
NET INCOME $ 1,415 $ 1,227
ADJUSTMENTS TO RECONCILE NET INCOME TO NET
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:
DEPRECIATION AND AMORTIZATION 333 289
PROVISION FOR UNCOLLECTIBLE ACCOUNTS AND SALES
RETURNS 106 127
PROVISION FOR MARKDOWN OF INVENTORY 480 475
DEFERRED INCOME TAXES 724 (254)
CHANGES IN ASSETS AND LIABILITIES:
(INCREASE) DECREASE IN ACCOUNTS
RECEIVABLE - TRADE 7,266 (5,459)
DECREASE IN VENDOR AND OTHER RECEIVABLES 242 844
(INCREASE) DECREASE IN INVENTORIES 6,380 (11,149)
INCREASE (DECREASE) ACCOUNTS PAYABLE (14,515) 11,459
DECREASE IN ACCRUED LIABILITIES (237) (1,153)
INCREASE (DECREASE) IN INCOME TAXES PAYABLE 29 (368)
INCREASE IN PREPAID EXPENSES AND OTHER ASSETS (1,011) (339)
NET CASH PROVIDED BY (USED IN) OPERATING
ACTIVITIES 1,212 (4,301)
CASH FLOWS FROM INVESTING ACTIVITIES:
PURCHASE/DISPOSAL OF PROPERTY AND EQUIPMENT, NET (246) (689)
PURCHASE OF INVESTMENTS, AVAILABLE-FOR-SALE (14,532) (34,570)
REDEMPTION OF INVESTMENTS, AVAILABLE-FOR-SALE 19,850 31,308
PURCHASE OF TREASURY STOCK (90) --
NET CASH PROVIDED BY (USED IN) INVESTING
ACTIVITIES 4,982 (3,951)
CASH FLOWS FROM FINANCING ACTIVITIES:
PROCEEDS FROM EXERCISE OF OPTIONS AND RELATED TAX
BENEFITS 32 36
NET CASH PROVIDED BY FINANCING ACTIVITIES 32 36
EFFECT OF EXCHANGE RATE CHANGES ON CASH 1 --
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 6,227 (8,216)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 13,592 8,706
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 19,819 $ 490
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED STATEMENTS.
Page 6 of 12
ADVANCED MARKETING SERVICES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. BASIS OF PRESENTATION
The financial statements presented herein as of and for the three months ended
June 28, 1997 and June 29, 1996 have been prepared in accordance with generally
accepted accounting principles and with instructions to Form 10-Q. These
financial statements have not been examined by independent public accountants,
but include all adjustments (consisting of normal recurring adjustments) which
are, in the opinion of Management, necessary for a fair presentation of the
financial condition, results of operations and cash flows for such periods.
The accompanying consolidated financial statements include the accounts of the
Company and its wholly-owned subsidiaries. All significant intercompany
accounts and transactions have been eliminated.
Certain information and footnote disclosures normally included in financial
statements in accordance with generally accepted accounting principles have been
omitted pursuant to requirements of the Securities and Exchange Commission.
Management believes that the disclosures included in the accompanying interim
financial statements and footnotes are adequate to make the information not
misleading. For further information, refer to the financial statements and
notes thereto included in the Company's Annual Report on Form 10-K for the
fiscal year ended March 31, 1997.
The results of operations for the three month period ended June 28, 1997 are not
necessarily indicative of the results to be expected for the fiscal year ending
March 31, 1998. Net sales in the Company's third fiscal quarter have
historically been, and are expected to be, significantly greater than in any
other quarter of the fiscal year due to increased demand during the holiday
season.
2. INTERIM ACCOUNTING PERIODS
In accordance with wholesale distribution industry practice, net sales and cost
of goods sold for interim periods are cut off on the Saturday nearest to the end
of an accounting period. The cut-off for the fourth fiscal quarter is March 31.
This practice may result in differences in the number of business days for which
sales and cost of goods sold are recorded both as to quarter-to-quarter
comparisons, and as to comparisons of quarters between years.
3. INVESTMENTS, AVAILABLE-FOR-SALE
"Investments, available-for-sale" consist principally of highly rated municipal
bonds and funds held in managed investment funds.
The cost and estimated fair market value of investments at June 28, 1997 and
June 29, 1996 are as follows (in thousands):
<TABLE>
June 28, 1997
Gross Gross
Amortized Unrealized Unrealized Estimated
Cost Gains Losses Fair Value
<S> <C> <C> <C> <C>
Debt Securities issued by States
of the U.S. and political
subdivisions of the States $ 5,913 47 -- $ 5,960
</TABLE>
Page 7 of 12
<TABLE>
June 29, 1996
Gross Gross
Amortized Unrealized Unrealized Estimated
Cost Gains Losses Fair Value
<S> <C> <C> <C> <C>
Debt Securities issued by States
of the U.S. and political
subdivisions of the States $15,785 7 7 $15,785
</TABLE>
As of June 28, 1997 investments in debt securities issued by states of the U.S.
and political subdivisions of the States in the amount of $2,852,283 are
scheduled to mature within one year and $3,108,207 are scheduled to mature
within 2 years.
There were no proceeds or gain or loss realized from the sale of investments for
the quarters ended June 28, 1997 and June 29, 1996. The Company uses the
specific identification method in determining cost on these investments. The
increase in unrealized gains on investments was approximately $36,000 and the
decrease in unrealized loss on investments was approximately $2,000 for the
quarter ended June 28, 1997.
4. SALES RETURNS
In accordance with industry practice, a significant portion of the Company's
products are sold to customers with the right of return. The Company has
provided allowances of $2,021,000 as of June 28, 1997, $2,035,000 as of March
31, 1997 and $2,173,000 as of June 29, 1996 for the gross profit effect of
estimated future sales returns.
5. INVENTORIES
Inventories consist primarily of books and prerecorded audio and video cassettes
purchased for resale and are stated at the lower of cost (first-in, first-out)
or market.
6. LINE OF CREDIT
The Company had available at June 28, 1997 an unsecured bank line of credit with
a maximum borrowing limit of $10 million. The interest rate is at prime (8.5
percent at June 28, 1997). The line of credit expires July 31, 1998. As of
June 28, 1997 and June 29, 1996, there were no outstanding borrowings on the
line of credit.
7. INCOME TAXES
The Company provides currently for taxes on income regardless of when such taxes
are payable. Deferred income taxes result from temporary differences in the
recognition of income and expense for tax and financial reporting purposes.
Income taxes paid in the three months ended June 28, 1997 totaled $48,000.
Income taxes paid during the same period of the previous year totaled
$1,318,000.
8. PER SHARE INFORMATION
Per share information is based on the weighted average number of common shares
and, when applicable, dilutive common share equivalents outstanding during the
periods. The effects of all anti-dilutive common share equivalents are excluded
from the calculation of earnings per share. The Company's only potential
dilutive common share equivalents are stock options.
Statement of Financial Accounting Standards No. 128, "Earnings Per Share," was
issued in February 1997 and becomes effective for the Company's fiscal year
ending March 31, 1998. SFAS No. 128 modifies the way in which earnings per
share ("EPS") is calculated and disclosed. Currently, the Company discloses
primary and fully diluted EPS. Upon adoption of the standard, the Company will
disclose basic and diluted EPS for fiscal 1998 and will restate all prior period
EPS data presented. Basic EPS excludes dilution and is computed by dividing
income available to common stockholders by the weighted-average number of common
Page 8 of 12
shares outstanding for the period. Diluted EPS, similar to fully diluted EPS,
reflects the potential dilution that could occur if securities or other
contracts to issue common stock were exercised or converted into common stock or
resulted in the issuance of common stock that then shared in earnings of the
entity. If the Company had adopted SFAS No. 128 for the quarter ended June 28,
1997, basic EPS would have been $.26 per share versus $.25 reported for primary
EPS. Diluted EPS would have been $.25 per share, unchanged from fully diluted
EPS reported for the quarter.
9. EMPLOYEE STOCK OPTION PLAN
Nonqualified options to purchase an aggregate of 461,280 shares of common stock
were outstanding as of June 28, 1997. The outstanding options were at prices
ranging from $2.02 to $11.16 per share.
Page 9 of 12
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
A. RESULTS OF OPERATIONS
Three Month Periods Ended June 28, 1997 and June 29, 1996:
During the three months ended June 28, 1997, the Company reported net income of
$1,415,000, or $.25 per share, compared with net income of $1,227,000, or $.21
per share, for the corresponding quarter of the previous year.
Net sales for the quarter ended June 28, 1997 decreased 16 percent to
$82,080,000 compared to $97,797,000 in the quarter ended June 29, 1996. Sales
during the first quarter of fiscal 1998 declined, in part, as a result of the
publication of fewer major best selling novels and industry-wide declines in the
rate of sale of certain high volume juvenile titles. Customer returns during the
first quarter of fiscal 1998 remained essentially unchanged in absolute dollars,
but increased as a percentage of sales to 29 percent from 25 percent in the
first quarter of fiscal 1997. Net sales were also reduced in the first quarter
of fiscal 1998 as a result of a concerted effort by the Company and its major
customers to reduce initial laydown quantities of new titles. As a result,
customers' retail inventories were significantly reduced at the end of the first
quarter of fiscal 1998 compared to the first quarter of the prior fiscal year.
The Company believes its Vendor Managed Inventory programs will allow it to keep
its customers in stock while maintaining lower retail inventory levels than in
the past. Subsequent to the end of the first quarter of fiscal 1998, these
programs reduced returns in July 1997 and it is anticipated that they will have
a favorable impact on future sales returns.
During the first quarter of fiscal 1998, gross profit increased to $9,702,000
from $9,185,000 in the first quarter of the previous fiscal year. Gross profit
as a percentage of net sales was 11.8 percent for the first quarter of fiscal
1998 compared with 9.4 percent in the same period last year. This increase
resulted from lower sales of the above-mentioned higher volume titles, which
typically carry lower margins, as well as a modest sales increase of higher
margin internally published titles.
Distribution and administrative expenses for the quarter ended June 28, 1997
totaled $7,815,000, or 9.5 percent of net sales, compared to $7,481,000, or 7.7
percent of net sales, in the same quarter of the previous fiscal year.
Distribution expenses increased modestly as a percentage of sales while
administrative expenses increased in both dollar terms and as a percentage of
sales primarily as a result of higher compensation costs and reduced cash
discount income.
Net interest and dividend income increased to $353,000 in the first quarter of
fiscal 1998 from $234,000 in the corresponding period of the previous fiscal
year. This increase was the result of increased cash and investment balances.
The Company's combined federal and state statutory tax rate is approximately 39
percent. Various adjustments, primarily due to the tax benefit of loss
carryforward on the Company's foreign operations as well as tax-exempt interest
income, offset, in part, by foreign currency exchange losses, caused the fiscal
1998 first quarter provision for income taxes to be $825,000, or 37 percent of
pre-tax income. The tax provision for the first quarter of fiscal 1997 was
$711,000, or 37 percent of per-tax income, primarily due to tax-exempt interest
income.
B. LIQUIDITY AND SOURCES OF CAPITAL
For the quarter ended June 28, 1997, $1,212,000 of net cash was provided by
operating activities. Net cash used in operating activities in the same period
of the prior fiscal year was $4,301,000. The Company's cash and investments as
of June 28, 1997 increased by $9,504,000 compared to June 29, 1996, primarily
due to net income and a decrease in accounts receivable, offset, in part, by a
decrease in accounts payable. Trade accounts receivable decreased $16,799,000
as of June 28, 1997 compared to June 29, 1996 due primarily to a decrease in net
sales as well as a decrease in customer disputed items. Accounts payable as of
June 28, 1997 decreased $11,083,000 compared to June 29, 1996 primarily as a
result of reduced inventory purchases related to the decrease in net sales.
Page 10 of 12
The Company's cash and investments at June 28, 1997 increased by $947,000
compared to March 31, 1997, primarily due to net income and a decrease in
accounts receivable and inventory, offset, in part, by a decrease in accounts
payable. Trade accounts receivable decreased $7,331,000 at June 28, 1997
compared to March 31, 1997 primarily due to a decrease in net sales as well as a
decrease in customer disputed items. At June 28, 1997, accounts payable
decreased $14,505,000 and inventory decreased $6,886,000 compared to March 31,
1997, primarily as a result of reduced inventory purchases related to the
decrease in net sales.
Working capital was $51,049,000 as of June 28, 1997 compared to the June 29,
1996 level of $47,233,000 and the March 31, 1997 balance of $51,456,000. The
slight decrease compared to March 31, 1997 was primarily the result of an
increase in long-term investments.
The Company had available at June 28, 1997 an unsecured bank line of credit with
a maximum borrowing limit of $10 million. The interest rate is at prime (8.5
percent at June 28, 1997). The line of credit expires July 31, 1998. The
Company did not borrow on its line of credit during the quarters ended June 28,
1997 and June 29, 1996.
The Company believes that its working capital, cash flows from operations, trade
credit traditionally available from its vendors and its $10 million line of
credit will be sufficient to finance its current and anticipated levels of
operations.
C. STATEMENT OF PURPOSE OF THE "SAFE HARBOR" PROVISIONS OF THE PRIVATE
SECURITITES LITIGATION REFORM ACT OF 1995
In December 1995, the Private Securities Litigation Reform Act of 1995 (the
"Act") was enacted. The Act contains amendments to the Securities Act of 1933
and the Securities Exchange Act of 1934 which provide protection from liability
in private lawsuits for "forward-looking" statements made by persons specified
in the Act. The Company desires to take advantage of the "safe harbor"
provisions of the Act.
The Company wishes to caution readers that, with the exception of historical
matters, the matters discussed in this Quarterly Report on Form 10-Q are
forward-looking statements that involve risks and uncertainties, including but
not limited to factors related to the highly competitive nature of the
publishing industry as well as the warehouse club and retail industries and
their sensitivity to changes in general economic conditions, the Company's
ability to impact customer return rates, currency and other risks related to
foreign operations, the results of financing efforts and other factors discussed
in the Company's other filings with the Securities and Exchange Commission.
Such factors could affect the Company's actual results during fiscal 1998 and
beyond and cause such results to differ materially from those expressed in any
forward-looking statement made by or on behalf of the Company.
Page 11 of 12
PART II. OTHER INFORMATION
ITEMS 1-3. NOT APPLICABLE
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Registrant's Annual Meeting of Stockholders was held on July 24, 1997.
Charles C. Tillinghast, III (4,941,608 votes for; 29,075 abstain/withheld),
Loren C. Paulsen (4,940,808 votes for; 29,875 abstain/withheld) and Michael M.
Nicita (4,900,808 votes for; 69,875 abstain/withheld) were elected as Class A
directors to serve a three-year term, and will serve until their respective
successors are elected and qualified.
ITEM 5. OTHER INFORMATION - NONE
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
11.0 Statement re Computation of Per Share Earnings
27.0 Financial Data Schedule
(b) Reports on Form 8-K - None
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.
ADVANCED MARKETING SERVICES, INC.
(Registrant)
August 8, 1997 By: /s/ Charles C. Tillinghast, III
Date Charles C. Tillinghast, III
Chairman
August 8, 1997 By: /s/ Michael M. Nicita
Date Michael M. Nicita
Chief Executive Officer
(Principal Executive, Financial
and Accounting Officer)
Page 12 of 12
Exhibit 11.0
<TABLE>
ADVANCED MARKETING SERVICES, INC.
STATEMENT RE COMPUTATION OF PER SHARE EARNINGS
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED
JUNE 28, JUNE 29,
1997 1996
<S> <C> <C>
NET INCOME $1,415 $1,227
WEIGHTED AVERAGE COMMON AND COMMON SHARE
EQUIVALENTS
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING 5,518 5,468
WEIGHTED AVERAGE COMMON SHARE
EQUIVALENTS-DILUTIVE STOCK OPTIONS:
PRIMARY 184 278
FULLY DILUTED 186 281
TOTAL WEIGHTED AVERAGE COMMON AND
COMMON EQUIVALENT SHARES:
PRIMARY 5,702 5,746
FULLY DILUTED 5,704 5,749
NET INCOME PER COMMON AND
COMMON SHARE EQUIVALENT
PRIMARY $ .25 $ .21
FULLY DILUTED $ .25 $ .21
</TABLE>
Common share equivalents (for AMS outstanding stock options) are excluded from
earnings per share calculations when antidilutive.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S CONSOLIDATED FINANCIAL STATEMENTS OF INCOME AND CONSOLIDATED BALANCE
SHEETS AND IS QUALIFIED BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> JUN-28-1997
<CASH> 19819
<SECURITIES> 2852
<RECEIVABLES> 46233
<ALLOWANCES> 3832
<INVENTORY> 84859
<CURRENT-ASSETS> 162050
<PP&E> 9378
<DEPRECIATION> 5703
<TOTAL-ASSETS> 170189
<CURRENT-LIABILITIES> 111001
<BONDS> 0
0
0
<COMMON> 6
<OTHER-SE> 59188
<TOTAL-LIABILITY-AND-EQUITY> 170189
<SALES> 82080
<TOTAL-REVENUES> 82080
<CGS> 72378
<TOTAL-COSTS> 72378
<OTHER-EXPENSES> 7815
<LOSS-PROVISION> 86
<INTEREST-EXPENSE> 353
<INCOME-PRETAX> 2240
<INCOME-TAX> 825
<INCOME-CONTINUING> 1415
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1415
<EPS-PRIMARY> .25
<EPS-DILUTED> .25
</TABLE>
