SECURITIES AND EXCHANGE COMMISSION
WASHINGTON DC 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly period ended April 30, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 0-16448
HOLIDAY RV SUPERSTORES, INCORPORATED
I.R.S. # 59-1834763
State of Incorporation: Florida
Sand Lake West Executive Park
7851 Greenbriar Parkway
Orlando, Florida 32819
(407) 363-9211
Indicate by check mark whether the registrant (1) has filed
all reports 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 May 22, 1995, Holiday RV Superstores, Incorporated had
outstanding 7,395,700 shares of Common Stock, par value $.01 per
share.
<PAGE>
<TABLE>
PART I
Financial Information
Item 1. Financial Statements
HOLIDAY RV SUPERSTORES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
_____________________________________________________
ASSETS
________
<CAPTION>
04/30/95 10/31/94
(Unaudited)
____________ ____________
<S> <C> <C>
Current:
Cash and cash equivalents $ 4,721,943 $ 5,239,701
Accounts receivable:
Trade and contracts in transit 1,249,986 1,263,422
Other 486,254 293,055
Inventories 18,935,636 17,193,896
Prepaid expenses 53,667 146,854
Deferred income taxes 63,000 63,000
____________ ____________
Total Current Assets 25,510,486 24,199,928
Property and Equipment,
less accumulated depreciation 2,202,730 1,710,567
Rental Fleet,
less accumulated depreciation ----- 531,280
Other Assets, principally covenant
not to compete 429,968 483,031
____________ _ ___________
TOTAL ASSETS $ 28,143,184 $ 26,924,806
============ ============
<FN>
See accompanying notes to the consolidated condensed
financial statements.
</TABLE>
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<TABLE>
HOLIDAY RV SUPERSTORES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
_____________________________________________________
LIABILITIES AND STOCKHOLDERS' EQUITY
____________________________________
<CAPTION>
04/30/95 10/31/94
(Unaudited)
____________ _____________
<S> <C> <C>
Current Liabilities:
Floor plan contracts $ 13,643,322 $ 13,169,621
Accounts payable 681,632 683,069
Customer deposits 179,773 211,193
Accrued expenses 813,148 814,355
____________ _____________
Total Current Liabilities 15,317,875 14,878,238
Deferred Income Taxes 97,000 97,000
Stockholders' Equity:
Common stock $.01 par - shares
authorized 10,000,000; issued
7,465,000 and 7,340,000 74,650 74,650
Additional paid-in capital 5,069,842 5,069,842
Retained earnings 7,659,925 6,881,184
Treasury stock, at cost, 69,300
and 68,300 shares (76,108) (76,108)
____________ ____________
Total Stockholders' Equity 12,728,309 11,949,568
____________ ____________
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 28,143,184 $ 26,924,806
============ ============
<FN>
See accompanying notes to the consolidated condensed financial
financial statements.
</TABLE>
<PAGE>
<TABLE>
HOLIDAY RV SUPERSTORES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
_____________________________________________________
(Unaudited)
<CAPTIONS>
Three Months Ended Six Months Ended
04/30/95 04/30/94 04/30/95 04/30/94
___________ ___________ ___________ ___________
<S> <C> <C> <C> <C>
Sales and Service
Revenue $23,958,041 $16,867,099 $39,491,710 $27,416,839
Cost of Sales and
Service 19,874,279 14,402,341 32,771,536 23,338,668
___________ ___________ ___________ ___________
Gross Profit 4,083,762 2,464,758 6,720,174 4,078,171
Selling, General
and Administrative
Expenses 2,748,938 1,726,599 4,935,023 3,165,528
___________ ___________ ___________ ___________
Income from
operations 1,334.824 738,159 1,785,151 912,643
Interest Income 75,500 33,872 170,179 84,616
Interest Expense 361,593 164,282 691,084 295,521
___________ ___________ ___________ ___________
Income before
income taxes 1,048,731 607,749 1,264,246 701,738
Income Taxes 401,670 228,697 485,505 263,883
___________ ___________ ___________ ___________
Net Income 647,061 379,052 778,741 437,855
=========== =========== =========== ===========
Earnings Per Share
of Common Stock $ 0.09 $ 0.05 $ 0.11 $ 0.06
=========== =========== =========== ===========
Weighted Average
Number of Common
Stock and Common
Stock Equivalents
Outstanding 7,398,300 7,271,700 7,400,800 7,271,700
=========== =========== =========== ==========
<FN>
See accompanying notes to the consolidated condensed
financial statements.
</TABLE>
<PAGE>
<TABLE>
HOLIDAY RV SUPERSTORES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
_____________________________________________________
(Unaudited)
<CAPTION>
SIX MONTHS ENDED
APRIL 30
1995 1994
___________ ___________
<S> <C> <C>
Cash flows from operating activities:
Cash received from customers $39,287,931 $26,856,746
Cash paid to suppliers and
employees (38,607,706) (26,648,816)
Interest received 170,179 84,616
Interest paid (610,217) (274,667)
Income taxes paid (348,648) (187,588)
____________ ___________
Net cash used for operating activities (108,497) (169,709)
Cash flows from investing activities:
Purchase of real property (546,490) ----
Purchase of equipment (38,121) (4,644)
Proceeds from the sale of rental
fleet and equipment 175,350 40,000
____________ ___________
Net cash (used for) provided by
investing activities (409,261) 35,356
Cash flows from financing activities:
Repayment of capital lease obligations ---- (3,035)
____________ ___________
Net cash used for financing ---- (3,035)
Net cash used for operating,
investing and financing activities (517,758) (137,388)
Cash and cash equivalents, beginning
of year 5,239,701 4,961,425
___________ ___________
Cash and cash equivalents, end of
quarter $ 4,721,943 $ 4,824,037
=========== ===========
</TABLE>
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<TABLE>
HOLIDAY RV SUPERSTORES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (CONCLUDED)
__________________________________________________________
(Unaudited)
<CAPTION>
SIX MONTHS ENDED
APRIL 30
1995 1994
___________ ___________
<S> <C> <C>
Reconciliation of net income to net
cash provided by (used for) operating
activities
Net income $ 778,741 $ 437,855
Adjustments to reconcile net loss to
net cash used for operating activities:
Depreciation and amortization 169,622 180,164
Gain on disposal of property and ( 24,016) (4,545)
equipment and rental fleet
Cash provided by (used for):
Accounts receivable (179,763) (555,547)
Inventories (1,385,905) (1,077,972)
Prepaid expenses 93,187 34,267
Floor plan contracts 473,701 813,441
Accounts payable (1,437) 141,184
Customer deposits (31,420) (25,009)
Accruals (1,207) (113,547)
___________ ___________
Net cash used for operating activities: ($ 108,497) ($ 169,709)
=========== ===========
<FN>
See accompanying notes to the consolidated condensed
financial statements.
</TABLE>
<PAGE>
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
NOTE 1.
The unaudited financial statements presented herein have been
prepared in accordance with the instructions to Form 10-Q, and do
not include all of the information and disclosures required by
generally accepted accounting principles. These statements
should be read in conjunction with the financial statements and
notes thereto included in the Company's Form 10-K for the year
ended October 31, 1994 The accompanying financial statements
have not been examined by an independent accountant in accordance
with generally accepted auditing standards, but in the opinion of
management, such financial statements include all adjustments,
consisting only of normal recurring adjustments and accruals, and
intercompany eliminations necessary to summarize fairly the
Company's financial position and results of operations. Due to
the seasonality of the Company's business, the results of
operations for six months ended April 30, 1995 are not
necessarily indicative of results to be expected for the three
months or fiscal year.
NOTE 2. INVENTORIES
<TABLE>
Inventories are summarized as follows:
<CAPTION>
April 30, 1995 October 31, 1994
______________ ________________
<S> <C> <C>
New Vehicles $13,248,004 $13,055,627
New Marine 440,466 422,615
Use Vehicles 3,920,775 2,525,036
Used Marine 58,160 34,842
Parts and
accessories 1,268,231 1,155,776
___________ ___________
$18,935,636 $17,193,896
=========== ===========
</TABLE>
NOTE: 3. SUPPLEMENTAL CASH FLOW INFORMATION
The change in inventory includes net non-cash transfers of
rental vehicles from inventory in the amount of $364,532 for the
six months ended April 30, 1995 and $120,274 for the six months
ended April 30, 1994.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
MATERIAL CHANGES IN FINANCIAL CONDITION
Certain current accounts, such as accounts receivable,
inventories, and floor plan contracts, materially changed during
the period. These changes are a result of normal seasonality of
the business, except as discussed in the financial condition
section of this report.
FINANCIAL CONDITION AS OF APRIL 30,1995 COMPARED TO APRIL 30,1994
The Company continued to maintain a strong financial position
and high liquidity for the first six months of Fiscal 95. Cash
received from customers and cash paid to suppliers and employers
increased dramatically, as compared to Fiscal 94, primarily as a
result of the additional cash flows from two RV dealerships
acquired on August 1, 1994 (Roseville and Bakersfield,
California). However, total cash flows from operating
activities was approximately the same as for Fiscal 94.
The company used $547,000 cash for investing activities, the
purchase of real property, for the relocation of its dealership
in Bakersfield, California.
The net result to the Company's cash position from all
activities was a decrease of $518,000 resulting in a cash
position of $4.7 million as of April 30, 1995 as compared to $4.8
million as of April 30, 1994.
Net working capital increased to $10.2 million as of April 30,
1995 compared to $9.3 million as of April 30, 1994.
The Company's principal long term commitments consist of
obligations under operating leases. The Company also has a
contingent liability to repay a portion of agency commission
(referral fees) received principally from certain lending
institutions whereby the Company referred customers to one or
more third party financing sources and earned referral fees
(agency commissions) if the lender consummated a loan contract
with the customer. In some cases the Company is required to pay
back (chargeback) a pro rata amount of the referral fee to the
lender if the loan does not reach maturity for various reasons
such as foreclosure, refinancing, or loan pay-off, and only if
the charge back amount exceeds reserves retained by the lender.
The Company records agency commission income based upon the
amount earned less allowances for chargebacks. In determining
the allowance, the Company takes into consideration the total
customer loans outstanding and estimates the exposure for
potential chargebacks associated with these loans. The Company
<PAGE>
estimates the probability for loan pay-offs and the potential
chargebacks to the Company related thereto. The Company also
considers current and expected future economic conditions, the
effects of the change in customer interest rates and the aging of
all customer loans outstanding when estimating potential
chargebacks to the Company. Management expects the current
allowance for chargebacks to be sufficient to repay this
chargeback contingency and does not expect the ultimate
liability to have a significant impact of the liquidity of the
Company.
As of April 30,1995 the Company had maximum borrowing under
the floor plan contracts of $25 million of which approximately
$11 million was not used. Management believes that during the
next twelve months, cash generated by operating activities, cash
and cash equivalents currently on deposit with financial
institutions and financing currently available from floor plan
financing companies will be sufficient for its capital and
operating needs.
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS FOR THREE MONTHS ENDED APRIL 30, 1995
COMPARED TO THREE MONTHS ENDED APRIL 30, 1994.
Sales and service revenue increased 42% to $24.0 million from
$16.9 million primarily due to revenue from two dealerships
acquired from Venture Out, on August 1, 1994, (Roseville and
Bakersfield, California) accounting for $6.0 million of the
increase. On a same store basis, all major revenue sources
increased, resulting in a total revenue increase of 7%.
Cost of sales, as a percentage of revenue, decreased to 83.0%
from 85.4%.
Gross profit increased 65.7% to $4.1 million from $2.5
million. As a percent of revenue, gross profit increased
to 17.0% from 14.6%. This increase, dollars and percent, was
primarily due to gross profit from the acquired stores accounting
for $1.36 million of $1.62 million increase. On a same store
basis, gross profit increased 13% primarily due to increased
sales of new vehicles and increased net agency commissions,
up 18% and 15% respectively. The Company's management attributes
these increases to strong new vehicle sales at off dealership
consumer shows.
<PAGE>
Selling, general and administrative (SG&A) expenses increased
59% to $2.7 million from $1.7 million. As a percent of revenue,
SG & A expenses increased to 11.5% from 10.2%. On a comparable
basis, SG&A did not increase. The Company's management expects
SG&A to increase slightly for the remaining six months of Fiscal
95, on a comparable basis, due to planned increased marketing
expense.
Income from operations increased 81% to $1,335,000 from
$738,000. As a percent of revenue, income from operations
increased to 5.6% from 4.4%.
Interest income increased 123% to $75,500 from $33,800 due to
a higher yield on funds invested. Interest expense increased
120% to $362,000 from $164,000 as a result of an increase in the
average balance for floor plan contracts and an increase in the
rate charged on the contracts. Increased average floor plan
contracts was primarily due to increased new inventories for the
two acquired dealerships.
Income before income taxes increased 73% to $1,049,000 from
$608,000. As a percent of revenue, income before income taxes
increased 4.4% from 3.6%.
The combined Federal and State income tax rate was 38.3% in
Fiscal 95 compared to 37.6% in Fiscal 94. Income taxes for both
periods varied from the Federal statutory rates due to state
income taxes.
Net income increased 71% to $647,061 from $379,052. Net
income, as a percent of revenue, increased to 2.7% from 2.2%.
Earnings per share increased to 9 cents from 5 cents.
RESULTS OF OPERATIONS FOR SIX MONTHS ENDED APRIL 30, 1995
COMPARED TO SIX MONTHS ENDED APRIL 30, 1994.
The sales and service revenue increase 44% to $39.5 million
from $27.4 million primarily due to revenue from the two newly
acquired dealerships, accounting for $9.6 million of the
increased revenue. On a same store basis, all major revenue
sources increased resulting in a total revenue increase of 9%.
Cost of sales, as a percentage of revenue, decreased 83.0% from
85.1%.
Gross profit increased 40% to $6.7 million from $4.1 million.
As a percentage of revenue, gross profit increased to 17.0% from
14.9%. This increase, dollars and percent, was due to gross
profit from the acquired stores accounting for $2.2 million of
the $2.6 million increase. On a same store basis, gross profit
increased 13% primarily due to increased sales of new vehicles
<PAGE>
and increased net agency commissions, up 14% an 28%
respectively. The Company's management attributes these increases
in both revenue sources to strong new vehicle sales at off
dealership consumer shows in the second quarter.
Selling, general and administrative (SG&A) expenses increased
56% to $4.9 million from $3.2 million. As a percentage of
revenue, SG&A expenses decreased to 11.5% from 12.5%. On a
comparable basis, SG&A did not increase. The Company's
management expects SG&A to increase slightly for Fiscal 95, on a
comparable basis, due to planned increased marketing expense.
Income from operations increased 96% to $1.8 million from
$913,000. As a percentage of revenue, income from operations
increased 4.5% from 3.3%.
Interest income increased 101% to $171,000 from $85,000 due to
a higher yield on funds invested. Interest expense increased
134% to $691,000 from $296,000 as a result of an increase in the
average balance floor plan contracts (accounting for 62% of the
increase) and an increase in the rate charged on the contracts
(accounting for 38% of the increase). Increased average floor
plan contracts were primarily due to increased new inventories
for the two acquired dealerships.
Income before income taxes increased 80% to $1,264,000 from
$702,000. As a percentage of revenue, income before income taxes
increased 3.2% from 2.6%.
The combined Federal and State income tax rate were 38.4% in
Fiscal 95 compared to 37.6% in Fiscal 94. Income taxes for both
periods varied from the Federal statutory rates due to state
income taxes.
Net income increased 78% to $778,741 from $437,855. Net
income, as a percentage of revenue increased to 2.0% from 1.6%.
Earnings per share increased to 11 cents from 6 cents.
<PAGE>
PART II
OTHER INFORMATION
There is no information to report under Items 1, 2, 3 and 5 of
Part II of this report.
Item 4. Submission of Matters to a Vote of Security Holders
At the Annual Meeting of Shareholders held May 22, 1995 all
members of the Board of Directors of the Company stood for re-
election and were re-elected, being the following individuals:
Avie Abramowitz Joanne M. Kindlund
Paul G. Clubbe Newton C. Kindlund
Franklin J. Hitt James P. Williams
Lawrence H. Katz W. Hardee McAlhaney
Roy W. Parker G. Lee FitzGerald
All members were re-elected without opposition, and by
unanimous vote.
A resolution was unanimously adopted to continue the engagement
of the accounting firm of BDO Seidman as Independent Public
Accountant for the Company for the Fiscal Year ending October 31,
1995.
The company did not solicit proxies for the meeting. A total
of 4,687,500 shares of Common Stock were represented and voted at
the meeting.
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
No exhibits are required to be filed by the Company with this
report.
The Company filed no report on Form 8-K for the three months
ended April 30, 1995.
<PAGE>
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.
Date HOLIDAY RV SUPERSTORES, INCORPORATED
May 26,1995 /s/ Joanne M. Kindlund
______________________________________
Joanne M. Kindlund, Executive Vice
President-Administration, Secretary/Treasurer
Principal Administrative Officer
May 26,1995 /s/ W. Hardee McAlhaney
_____________________________________
W. Hardee McAlhaney, Vice President
Chief Financial Officer
Principal Financial and Accounting Officer
