<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Thirteen Weeks Ended October 28, 1995.
Commission File Number 1-9647
JAN BELL MARKETING, INC.
-------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 59-2290953
-------- ----------
(State of Incorporation) (IRS Employer
Identification No.)
13801 N.W. 14TH STREET, SUNRISE, FLORIDA 33323
----------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (305) 846-2705
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 / /
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
25,812,453 COMMON SHARES ($.0001 PAR VALUE)
AS OF DECEMBER 1, 1995
<PAGE> 2
FORM 10-Q
QUARTERLY REPORT
THIRTEEN WEEKS ENDED OCTOBER 28, 1995
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
PART I: FINANCIAL INFORMATION PAGE NO.
<S> <C>
Item 1. Consolidated Financial Statements
A. Consolidated Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
B. Consolidated Statements of Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
C. Consolidated Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
D. Notes to Consolidated Financial
Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
PART II: OTHER INFORMATION
Items 1, 2, 3 and 6
have been omitted because they are not
applicable with respect to the current
reporting period.
Item 4
Submission of Matters to a Vote of
Security Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Item 5
Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
</TABLE>
2
<PAGE> 3
PART I: FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
JAN BELL MARKETING, INC.
CONSOLIDATED BALANCE SHEETS
(Amounts shown in thousands except share and per share data)
A S S E T S
<TABLE>
<CAPTION>
October 28, January 28,
1995 1995
------------ ------------
(Unaudited)
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 9,345 $ 28,212
Accounts receivable, net 4,476 12,156
Inventories 129,739 106,053
Other current assets 1,099 1,738
------- -------
Total current assets 144,659 148,159
Property, net 26,221 29,639
Other assets 8,871 6,085
Goodwill 2,731 2,869
----- -------
$ 182,482 $ 186,752
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 28,523 $ 10,824
Accrued expenses 4,537 13,593
Short-term borrowings 4,523 ---
Long-term debt, current portion 9,000 35,000
----- ------
Total current liabilities 46,583 59,417
Long-term debt 17,500 ---
STOCKHOLDERS' EQUITY:
Common stock, $.0001 par value,
50,000,000 shares authorized,
25,812,433 and 25,741,991 shares
issued, respectively 3 3
Additional paid-in capital 180,981 178,896
Retained earnings (deficit) (61,250) (50,657)
Foreign currency translation
adjustment (1,335) ( 907)
----- -----
118,399 127,335
------- -------
$ 182,482 $ 186,752
======= =======
</TABLE>
See notes to consolidated financial statements.
3
<PAGE> 4
JAN BELL MARKETING, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(AMOUNTS SHOWN IN THOUSANDS EXCEPT SHARE AND PER SHARE DATA)
<TABLE>
<CAPTION>
Thirteen Weeks Thirteen Weeks
Ended Ended
October 28, 1995 October 30, 1994
---------------- ----------------
(Unaudited)
<S> <C> <C>
Net sales $ 46,209 $ 68,588
Cost of sales and
occupancy costs 35,860 57,960
------ ------
Gross profit 10,349 10,628
Store and warehouse
operating and selling expenses 8,196 9,454
General and administrative expenses 4,148 4,105
Amortization expense 284 528
Currency exchange (gain)/loss (37) ---
----- ------
Operating loss (2,242) (3,459)
Interest and other income 246 102
Interest expense 913 908
--- ------
Loss before income taxes (2,909) (4,265)
Income taxes 24 267
---- -----
Net loss $ (2,933) $ (4,532)
===== =====
Net loss per
common share $ (0.11) $ (0.18)
Weighted average shares
outstanding 25,756,464 25,725,533
</TABLE>
See notes to consolidated financial statements.
4
<PAGE> 5
JAN BELL MARKETING, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(AMOUNTS SHOWN IN THOUSANDS EXCEPT SHARE AND PER SHARE DATA)
<TABLE>
<CAPTION>
Thirty-Nine Weeks Thirty-Nine Weeks
Ended Ended
October 28, 1995 October 30, 1994
----------------- -----------------
(Unaudited)
<S> <C> <C>
Net sales $ 151,681 $ 191,675
Cost of sales
and occupancy costs 122,899 161,244
------- -------
Gross profit 28,782 30,431
Store and warehouse
operating and selling expenses 24,268 27,733
General and administrative expenses 12,561 13,592
Amortization expense 846 1,762
Currency exchange (gain)/loss 599 ---
------- ------
Operating loss (9,492) (12,656)
Interest and other income 1,198 207
Interest expense 2,190 2,522
------- -------
Loss before income taxes 10,484) (14,971)
Income taxes 110 472
------- -------
Net loss $ (10,594) $ (15,443)
======= =======
Net loss per common
share $ (.41) $ (.60)
Weighted average shares
outstanding 25,746,399 25,667,242
</TABLE>
See notes to consolidated financial statements.
5
<PAGE> 6
JAN BELL MARKETING, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(AMOUNTS SHOWN IN THOUSANDS)
<TABLE>
<CAPTION>
Thirty-Nine Weeks Ended Thirty-Nine Weeks Ended
October 28, 1995 October 30, 1994
----------------- ----------------
(Unaudited)
<S> <C> <C>
Cash flows from operating
activities:
Cash received from customers $ 159,360 $ 176,045
Cash paid to suppliers and
employees (173,048) (204,894)
Interest and other income
received 1,198 207
Interest paid (2,190) (2,522)
Income taxes (paid) refunded 417 13,561
--- ------
Net cash (used in)
operating activities (14,263) (17,603)
-------- --------
Cash flows from investing
activities:
Capital expenditures (639) (5,487)
--- -----
Net cash (used in)
investing activities (639) (5,487)
--- -----
Cash flows from financing
activities:
Net borrowings under line of
credit 4,523 23,000
Debt repayment (8,500) ---
Retirement of Common Stock (35) ---
Stock purchase plan payments
withheld 47 33
-- --
Net cash provided by (used in)
financing activities (3,965) 23,033
----- ------
Net (decrease) in cash
and cash equivalents (18,867) (57)
Cash and cash equivalents at
beginning of period 28,212 2,303
------- -----
Cash and cash equivalents at
end of period $ 9,345 $ 2,246
======= =====
</TABLE>
See notes to consolidated financial statements.
6
<PAGE> 7
JAN BELL MARKETING, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(CONTINUED)
(AMOUNTS SHOWN IN THOUSANDS)
<TABLE>
<CAPTION>
Thirty-Nine Weeks Thirty-Nine Weeks
Ended Ended
October 28, 1995 October 30, 1994
------------------ -----------------
(Unaudited)
<S> <C> <C>
Reconciliation of net loss
to net cash used in
operating activities:
Net loss $(10,594) $ (15,443)
Adjustments to reconcile
net loss to net cash
used in operating activities:
Depreciation and
amortization 4,902 5,987
Stock compensation expense 660 1,435
Foreign currency translation
adjustment (429) ---
(Increase) Decrease
in assets:
Accounts receivable (net) 7,680 (15,630)
Inventories (23,686) 3,250
Other (1,438) 11,879
Increase (Decrease) in
liabilities:
Accounts payable 17,813 11,554
Accrued expenses (9,171) (2,469)
Liability for inventory
sold and repurchased --- (18,166)
------ ------
Net cash used in
operating activities $(14,263) $ (17,603)
====== =======
</TABLE>
See notes to consolidated financial statements.
7
<PAGE> 8
JAN BELL MARKETING, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
A. Unaudited Financial Statements
The Company's financial statements for the thirteen and thirty-nine
week periods ended October 28, 1995 and October 30, 1994 have not been audited
by certified public accountants, but in the opinion of management of the
Company reflect all adjustments (which include only normal recurring accruals)
necessary to present fairly the financial position, results of operations and
cash flows for those periods. Results of the thirteen and thirty-nine week
periods ended October 28, 1995 and October 30, 1994 are not necessarily
indicative of annual results because of the seasonality of the Company's
business.
Certain reclassifications have been made to the prior consolidated
financial statements to conform to the current presentation.
The accompanying financial statements should be read in conjunction
with the Company's annual financial statements for the year ended January 28,
1995.
B. Agreement with Sam's Wholesale Club
The Company operates an exclusive leased department at all existing
and future domestic and Puerto Rican Sam's Wholesale Club ("Sam's") locations
under an agreement which expires February 1, 2001. The Company pays Sam's a
tenancy fee of 9% of net sales. During the thirteen and thirty-nine weeks
ended October 28, 1995, approximately 92% and 91% respectively of the Company's
net sales were from Sam's customers and for the foreseeable future it is
expected that the substantial portion of net sales will be generated through
this agreement. Accordingly, the Company is dependent on Sam's to conduct its
business and the loss of the leased department arrangement with Sam's would
have a material adverse effect on the business of the Company.
C. Inventories:
Inventories are summarized as follows:
<TABLE>
<CAPTION>
October 28, January 28,
1995 1995
----------- ------
(Amounts shown in thousands)
<S> <C> <C>
Precious and semi-precious jewelry-
related merchandise (and associated gold):
Raw materials $ 7,823 $ 8,617
Finished goods 54,013 41,775
Gold jewelry-related merchandise:
Raw materials 2 2
Finished goods 21,735 18,305
Watches 18,612 27,461
Other consumer products 27,554 9,893
------- -------
$129,739 $ 106,053
======= =======
</TABLE>
8
<PAGE> 9
JAN BELL MARKETING, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(continued)
D. Income Taxes
The Company's provision (benefit)for income taxes for 1995 and 1994 is
related to the operations of foreign affiliates. Federal and state tax benefits
have not been recognized for the domestic loss for 1995 and 1994 due to the
fact that all potential loss carrybacks have been fully utilized and, under
SFAS No. 109, "Accounting for Income Taxes," the Company has determined that it
is more likely than not that the deferred tax asset will not be realized.
E. Financing Arrangements
On May 31, 1995, the Company entered into an amended and restated
senior note agreement. At closing, the Company repaid $8.5 million in
principal amount of the notes. The notes (as amended, the "amended notes")
mature on February 1, 1998, are secured and bear interest for the period (a)
from closing to January 31, 1997, at an annual rate of 12.5% and (b) from
February 1, 1997 to maturity, at an annual rate of 16%. Two principal payments
in the amounts of $9 million and $10 million, respectively, are payable on
February 1, 1996 and February 1, 1997 with a final payment of $7.5 million due
February 1, 1998. The Company paid the noteholders a fee of $500,000 in
connection with this agreement.
On May 31, 1995 the Company also finalized a Working Capital Facility
with GBFC, Inc. (an affiliate of Gordon Brothers, Inc.) and Foothill Capital
Corporation which provides for a $30 million secured revolving bank credit
facility. Availability under the Working Capital Facility is determined based
upon a percentage formula applied to inventory and accounts receivable. The
Working Capital Facility terminates on May 31, 1997 and bears interest at an
annual rate of The First National Bank of Boston's base rate plus 1.5%. The
Company is required to pay a fee of $450,000 annually to the lenders and an
administration fee of $11,000 monthly.
The Company's liability under the amended notes is unconditionally
guaranteed by all of its material direct and indirect 51% (or greater)
subsidiaries. The liability under the Working Capital Facility is
unconditionally guaranteed by the Company and its subsidiaries. Substantially
all of the Company's assets are subject to a blanket lien in accordance with
the agreements related to the amended notes and Working Capital Facility. An
intercreditor agreement among the lenders provides that their respective
security interests in such collateral are subject to certain relative
priorities.
9
<PAGE> 10
JAN BELL MARKETING, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(continued)
Further, the Company granted to the noteholders warrants (the
"noteholder warrants") to purchase 1,732,520 shares of the Company's common
stock at an initial purchase price per share of $2.25. The noteholder warrants
vest as follows: 20% on May 31, 1995, 20% on February 2, 1996, 30% on
February 2, 1997 and 30% on July 31, 1997 if any obligations under the amended
notes remain outstanding on such respective dates. Any vested noteholder
warrants expire on May 1, 2005. In connection with the Working Capital
Facility, the Company granted warrants to purchase up to 234,000 shares of the
Company's common stock at exercise prices ranging from $3.25 to $4.00 per
share. The estimated fair value of the warrants granted to the noteholders and
Working Capital Facility Lenders has been recorded as a deferred financing
cost, included in other assets, and as an addition to paid in capital.
The agreements related to the amended notes and the Working Capital
Facility contain covenants which require the Company to maintain financial
ratios related to earnings, working capital, inventory turnover, trade payables
and tangible net worth, limit capital expenditures and the incurrence of
additional debt, and prohibit payment of dividends.
10
<PAGE> 11
Item 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
The Company operates an exclusive leased department at all existing
and future domestic and Puerto Rican Sam's Wholesale Club ("Sam's") locations
under an agreement which expires February 1, 2001. During the thirteen and
thirty-nine weeks ended October 28, 1995, approximately 92% and 91% of the
Company's net sales were from Sam's customers and for the foreseeable future
it is expected that the substantial portion of net sales will be generated
through this agreement.
Prior to 1993, the Company operated principally as a jewelry, watch
and fragrance wholesaler to the warehouse membership club industry. Following
the Company's transition to retailing as a leased department operator at Sam's
in the fourth quarter of 1993, the Company recognized the need for additional
retail management expertise. In Fiscal 1994, new Board members were recruited
from department and specialty store senior executives, who in turn hired a new
C.E.O. New management then began addressing the Company's strategic direction.
In late 1994 as part of the Fiscal 1995 planning process, management
and the new Board reviewed the Fiscal 1994 results of all lines of business and
their attendant cost structures. This process resulted in the following
decisions.
First, the Company's domestic manufacturing operations engaged in the
manufacturing of fixtures for the Company's retail locations and various gem
and gold products were closed.
Second, staffing levels were reduced at the Company's headquarters,
other operational expenses were reduced and merchandising programs were
designed to better manage retail sales, gross profit and the replenishment
function.
Third, management addressed the Company's wholesale watch division,
which had evolved into a low end watch business with sourcing in the parallel
markets and which contributed disproportionately to expense. With no perceived
opportunity to improve the performance of this division, management closed the
wholesale watch division, other than selected sales, and continued balancing of
inventory.
Results of operations for the thirteen and thirty-nine weeks ended
October 28, 1995 continue to reflect the implementation of these decisions.
Net sales were $46.2 million and $151.7 million for the thirteen and
thirty-nine weeks ended October 28, 1995 compared to $68.6 million and $191.7
million for the thirteen and thirty-nine weeks ended October 30, 1994. The
decline in sales in Fiscal 1995 reflects primarily the closing of the
11
<PAGE> 12
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Cont'd)
wholesale division as well as the reduction in business through the Mexican
operations due to the peso devaluation. Net sales in the retail locations for
the thirteen and thirty-nine weeks ended October 28, 1995 were $42.7 million
and $132.2 million compared to $43.3 million and $136.5 million for the
thirteen and thirty-nine weeks ended October 30, 1994.
Gross profit was $10.3 million or 22.4% of net sales for the thirteen
weeks ended October 28, 1995 compared to $10.6 million or 15.5% of net sales
for the thirteen weeks ended October 30, 1994. Gross profit was $28.8 million
or 19.0% of net sales for the thirty-nine weeks ended October 28, 1995 compared
to $30.4 million or 15.9% of net sales for the thirty-nine weeks ended October
30, 1994. The increase in gross profit as a percentage of net sales is
primarily attributable to margin improvements that are being recognized in the
Company's retail locations.
Management recognizes that significant continued improvement in both
sales and margins must be achieved for the Company to return to profitability.
Store and warehouse operating and selling expenses were $8.2 million
and $24.3 million for the thirteen and thirty-nine weeks ended October 28, 1995
compared to $9.5 million and $27.7 million for the thirteen and thirty-nine
weeks ended October 30, 1994. The decrease is reflective of field staff
reductions and warehouse operating expense savings as a result of the decision
to close the Company's wholesale watch and domestic manufacturing divisions.
General and administrative expenses were $4.1 million and $12.6
million for the thirteen and thirty-nine weeks ended October 28, 1995 compared
to $4.1 million and $13.6 million for the thirteen and thirty-nine weeks ended
October 30, 1994. In the thirty-nine weeks ended October 30, 1994, the Company
recorded a reduction to general and administrative expenses of $1.4 million
reflecting a change in estimate of certain transition related liabilities. The
decrease in general and administrative expenses, after considering this 1994
reduction is primarily reflective of expense reductions implemented as a result
of corporate staff reductions and the elimination of general and administrative
expenses associated with the Company's wholesale watch and domestic
manufacturing division.
The decrease in amortization expense to $284,000 and $846,000 for the
thirteen and thirty-nine weeks ended October 28, 1995 from $528,000 and
$1,762,000 for the thirteen and thirty-nine weeks ended October 30, 1994 is
primarily a result of the write off at January 28, 1995 of $23.8 million of
goodwill associated with the Company's 1990 purchase of the minority interest
of Big Ben '90.
12
<PAGE> 13
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Cont'd)
The instability of the Mexican peso during Fiscal 1995 resulted in a
currency exchange gain of $37,000 and a loss of $599,000 for the thirteen and
thirty-nine weeks ended October 28, 1995.
On November 9, 1995, the Company opened its first "Jewelry Depot", a
5,000 square foot value-oriented jewelry and luxury gift store in Framingham,
Massachusetts. Subsequently, the Company also opened two "Jewelry Depot
Outlets", a 1,500 square foot facility in Vero Beach, Florida and an 800 square
foot store in Worcester, Massachusetts. The "Jewelry Depot" and "Jewelry Depot
Outlets" each were opened as prototypes for potential stand-alone jewelry
operations that the Company will evaluate during the holiday selling season as
possible long term sources of additional revenue growth. Until such time,
there can be no measurement of these operations' impact on operating results or
future capital requirements.
The retail jewelry business is seasonal in nature with a higher
proportion of sales and significant portion of earnings generated during the
fourth quarter holiday selling season. As a result, operating results for the
thirteen and thirty-nine weeks ended October 28, 1995 are not necessarily
indicative of results of operations for the entire fiscal year.
FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES
As of October 28, 1995, cash and cash equivalents totalled $9.3
million, a decrease of $18.9 million from January 28, 1995 which resulted
primarily from cash used in operations and a debt repayment of senior notes of
$8.5 million. The Company had short-term working capital facility borrowings
outstanding of $4.5 million as of October 28, 1995.
The Company's working capital requirements are directly related to the
amount of inventory required to support its retail operations. During the
thirty-nine weeks ended October 28, 1995, the inventory increase of $23.7
million reflects a build up in anticipation of holiday sales.
For the remainder of Fiscal 1995, based on discussions with Sam's, the
Company expects a very limited increase in the number of leased departments it
operates, and consequently does not foresee a need for a significant increase
in retail inventory. Capital expenditures for Fiscal 1995 are projected not to
exceed $2 million.
The Company's business is highly seasonal, with seasonal working
capital needs peaking in October and November before the holiday selling
season.
13
<PAGE> 14
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Cont'd)
On May 31, 1995, the Company entered into an amended and restated
senior note agreement. At closing, the Company repaid $8.5 million in
principal amount of the notes. The notes (as amended, the "amended notes")
mature on February 1, 1998, are secured and bear interest for the period (a)
from closing to January 31, 1997, at an annual rate of 12.5% and (b) from
February 1, 1997 to maturity, at an annual rate of 16%. Two principal payments
in the amounts of $9 million and $10 million, respectively, are payable on
February 1, 1996 and February 1, 1997 with a final payment of $7.5 million due
February 1, 1998. The Company paid the noteholders a fee of $500,000 in
connection with this agreement.
On May 31, 1995 the Company also finalized a Working Capital Facility
with GBFC, Inc. (an affiliate of Gordon Brothers, Inc.) and Foothill Capital
Corporation which provides for a $30 million secured revolving bank credit
facility. Availability under the Working Capital Facility is determined based
upon a percentage formula applied to inventory and accounts receivable. The
Working Capital Facility terminates on May 31, 1997 and bears interest at an
annual rate of The First National Bank of Boston's base rate plus 1.5%. The
Company is required to pay a fee of $450,000 annually to the lenders and an
administration fee of $11,000 monthly.
The Company's liability under the amended notes is unconditionally
guaranteed by all of its material direct and indirect 51% (or greater)
subsidiaries. The liability under the Working Capital Facility is
unconditionally guaranteed by the Company and its subsidiaries. Substantially
all of the Company's assets are subject to a blanket lien in accordance with
the agreements related to the amended notes and Working Capital Facility. An
intercreditor agreement among the lenders provides that their respective
security interests in such collateral are subject to certain relative
priorities.
14
<PAGE> 15
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Cont'd)
Further, the Company granted to the noteholders warrants (the
"noteholder warrants") to purchase 1,732,520 shares of the Company's common
stock at an initial purchase price per share of $2.25. The noteholder warrants
vest as follows: 20% on May 31, 1995, 20% on February 2, 1996, 30% on February
2, 1997 and 30% on July 31, 1997 if any obligations under the amended notes
remain outstanding on such respective dates. Any vested noteholder warrants
expire on May 1, 2005. In connection with the Working Capital Facility, the
Company granted warrants to purchase up to 234,000 shares of the Company's
common stock with exercise prices ranging from $3.25 to $4.00 per share.
The agreements related to the amended notes and the Working Capital
Facility contain covenants which require the Company to maintain financial
ratios related to earnings, working capital, inventory turnover, trade payables
and tangible net worth, limit capital expenditures and the incurrence of
additional debt, and prohibit payment of dividends. There can be no assurance
that the Company's future operating results will be sufficient to meet the
requirements of the foregoing covenants.
The Company believes that its cash on hand, projected cash from
operations and availability under the Working Capital facility will be
sufficient to meet its debt service requirements and anticipated working
capital and capital expenditure needs for the remainder of Fiscal 1995. There
can be no assurance that the Company's future operating results will be
sufficient to sustain such debt service and working capital needs.
15
<PAGE> 16
PART II: OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
The Annual Meeting of Shareholders was held August 10, 1995. The
Shareholders of the Company elected as directors Sidney Feltenstein and Thomas
Epstein to serve terms expiring in 1998. The election of directors by the
Shareholders was by the following votes:
<TABLE>
<CAPTION>
DIRECTOR FOR WITHHELD
- -------- --- --------
<S> <C> <C>
Sidney Feltenstein 22,508,855 457,395
Thomas Epstein 22,504,844 461,406
</TABLE>
The following are directors whose term of office continued after the
Annual Meeting: Isaac Arguetty, Joseph Pennacchio, Chaim Edelstein, Dean
Groussman and John Burden.
The Shareholders also ratified Deloitte and Touche LLP as independent
accountants of the Company for the fiscal year ending February 3, 1996 by a
vote of 22,689,828 shares in favor, 97,446 shares against and 178,976 shares
abstaining.
Item 5. Other Information
The Company on December 8, 1995 decided to change its fiscal year from
a retail 52/53 week fiscal year ending on the last Saturday of each January to a
retail 52/53 week fiscal year ending on the Saturday closest to the end of each
January.
16
<PAGE> 17
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.
JAN BELL MARKETING, INC.
---------------------------------
(Registrant)
By: David P. Boudreau
---------------------------------
Senior Vice President of Finance,
and Treasurer
Date: December 12, 1995
17
<PAGE> 18
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ------- -----------
<S> <C>
27 Financial Data Schedule (for SEC use only)
</TABLE>
18
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED STATEMENTS OF INCOME, THE CONSOLIDATED BALANCE SHEETS, THE
CONSOLIDATED STATEMENTS OF CASH FLOWS AND THE NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> FEB-03-1996
<PERIOD-START> JAN-29-1995
<PERIOD-END> OCT-28-1995
<CASH> 9,010
<SECURITIES> 335
<RECEIVABLES> 5,613
<ALLOWANCES> 1,137
<INVENTORY> 129,739
<CURRENT-ASSETS> 144,659
<PP&E> 47,871
<DEPRECIATION> 21,650
<TOTAL-ASSETS> 182,482
<CURRENT-LIABILITIES> 46,583
<BONDS> 0
<COMMON> 3
0
0
<OTHER-SE> 118,396
<TOTAL-LIABILITY-AND-EQUITY> 182,482
<SALES> 151,680
<TOTAL-REVENUES> 151,680
<CGS> 122,899
<TOTAL-COSTS> 122,899
<OTHER-EXPENSES> 38,273
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,190<F1>
<INCOME-PRETAX> (10,484)
<INCOME-TAX> 110
<INCOME-CONTINUING> (10,594)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (10,594)
<EPS-PRIMARY> (.41)
<EPS-DILUTED> (.41)
<FN>
<F1>OTHER EXPENSES CONSISTS OF ALL NON-OPERATING COSTS EXCLUDING INCOME TAXES.
AMOUNT INCLUDES INTEREST EXPENSE NET OF INTEREST INCOME AND OTHER NON-OPERATING
NET. (NET).
</FN>
</TABLE>
