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Previous: MBNA AMERICA BANK NATIONAL ASSOCIATION, 424B5, 2000-03-16 |
Next: DORAL FINANCIAL CORP, DEF 14A, 2000-03-16 |
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 January 31, 2000
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 333-54035
MTS, INCORPORATED (Exact name of Registrant as specified in its Charter)
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2500 Del Monte Street
West Sacramento, California 95691
(Address of Principal Executive Offices including Zip Code)
916-373-2500
(Registrant's Telephone Number, Including Area Code)
(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 reports), and (2) has been subject to such filing requirements for the past 90 days. YES [X] NO [ ]
MTS, INCORPORATED
FORM 10-Q
TABLE OF CONTENTS
Part I. Financial Information
Part I. Financial Information
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Part II. Other Information
PART I -- FINANCIAL INFORMATION
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS
MTS, INCORPORATED
The accompanying notes are an integral part of these statements.
MTS, INCORPORATED
The accompanying notes are an integral part of these statements.
MTS, INCORPORATED
CONSOLIDATED STATEMENTS OF CASH FLOWS
The accompanying notes are an integral part of these statements.
MTS, INCORPORATED
The accompanying notes are an integral part of these statements.
The accompanying notes are an integral part of these statements.
MTS, INCORPORATED NOTE 1- BASIS OF PRESENTATION The unaudited consolidated financial statements include the accounts of
MTS, Incorporated and its majority and wholly owned subsidiaries
(Company). In the opinion of the Company's management, the accompanying
unaudited consolidated financial statements contain all adjustments
(consisting of only normal recurring adjustments) necessary to present
fairly its consolidated financial position as of January 31, 2000 and the
results of its operations and cash flows for the three and six months then
ended. The significant accounting policies and certain financial
information which are normally included in financial statements prepared
in accordance with generally accepted accounting principals, but which are
not required for interim reporting purposes, have been condensed or
omitted. The accompanying consolidated financial statements should be read
in conjunction with the Company's Annual Report on Form 10-K for the
fiscal year ended July 31, 1999.
NOTE 2- TRANSLATION OF FOREIGN CURRENCY
The value of the U.S. dollar rises and falls day-to-day on foreign
currency exchanges. Since the Company does business in several foreign
countries, these fluctuations affect the Company's financial position and
results of operations. In accordance with SFAS No. 52, Foreign Currency
Translation, all foreign assets and liabilities have been translated at
the exchange rates prevailing at the respective balance sheets dates, and
all income statement items have been translated using the weighted average
exchange rates during the respective years. The net gain or loss
resulting from translation upon consolidation into the financial
statements is reported as a separate component of shareholder's equity.
Some transactions of the Company and its foreign subsidiaries are made in
currencies different from their functional currency. Translation gains
and losses from these transactions are included in income as they occur.
The Company recorded net transaction losses of $5.9 million and $9.5
million for the six months ended January 31, 2000 and 1999, respectively.
These amounts primarily represent unrealized losses on the Company's yen-
denominated debt and the strengthening of the yen versus the U.S. dollar.
NOTE 3- INCOME TAXES
The effective income tax rates for the six months ended January 31, 2000
and 1999 are based on the federal statutory income tax rate, increased
for the effect of state income taxes, net of federal benefit and foreign
taxes.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS The following information should be read in conjunction with the
unaudited interim consolidated financial statements and the notes
thereto included in Item 1 of this Quarterly Report on Form 10-Q.
Forward-Looking Statements This report and other written reports and oral statements made from time
to time by the Company may contain so called forward-looking statements
as contained in the Private Securities Litigation Reform Act of 1995,
all of which are subject to risks and uncertainties. One can identify
these forward-looking statements by their use of words such as expects,
believes, anticipates, estimates, forecasts and other words of similar
meaning. One can also identify them by the fact that they do not relate
strictly to historical or current facts. These statements are likely to
address the Company's growth strategy, financial performance (including
sales and earnings guidance), marketing and expansion plans, Y2K
compliance and similar matters. One must carefully consider any such
statement and should understand that many factors could cause actual
results and plans to differ from those included in the Company's
forward-looking statements. These factors include inaccurate
assumptions and a broad variety of risks and uncertainties, including
some that are known and some that are not. No forward-looking statement
can be guaranteed and actual future results may vary materially.
Although it is not possible to predict or identify all such factors,
they may include the following: (i) consumer demand for the Company's
products, which is believed to be related to a number of factors,
including overall consumer spending patterns, weather conditions and new
releases available from suppliers; (ii) an unexpected increase in
competition, including Internet competition and competition resulting
from electronic or other alternative methods of delivery of music and
other products to consumers, or unanticipated margin or other
disadvantages relative to our competitors; (iii) the continued
availability of adequate capital to fund the Company's operations; (iv)
higher than anticipated interest, occupancy, labor, distribution and
inventory shrinkage costs; (v) unanticipated adverse litigation expenses
or results; (vi) higher than anticipated costs associated with the
closing of underperforming stores; (vii) unanticipated increases in the
cost of merchandise sold by the Company; (viii) the performance of the
Company's new strategic initiatives, including the Internet; (ix)
unanticipated costs or problems relating to the Company's Year 2000
issues; (x) changes in foreign currency exchange rates and economic and
political country risk; and (xi) the continued ability of the Company to
locate and develop suitable sites for its expansion program. Actual
results or outcomes may differ materially from those expressed or
implied by such forward-looking statements as a result of certain risk
factors described herein and in other documents filed with the
Securities and Exchange Commission. Readers are cautioned that all
forward-looking statements involve risks and uncertainty. Readers
should also carefully review the risk factors described in the other
documents the Company files from time to time with the United States
Securities and Exchange Commission, including but not limited to its
Form 10-K for the year ended July 31, 1999. The Company assumes no
obligation to update any such forward-looking statements.
Results of Operations Three Months Ended January 31, 2000 Compared to Three Months
Ended January 31, 1999
Net Revenue Gross Profit Gross profit was $98.7 million for the three months ended January 31,
2000, an increase of $5.7 million or 6.1%, from $93.0 million for the
three months ended January 31, 1999. Gross profit as a percentage of
net revenues decreased to 29.4% of net revenues for the three months
ended January 31, 2000 as compared to 30.7 % of net revenues for the
three months ended January 31, 1999. The primary factors contributing
to the decrease in gross margin was a result of a one-time video rental
write-down due to the closure of a majority of the company's video
rental departments, Internet pricing programs and an increase in certain
domestic vendor pricing which was not incrementally passed to the
consumer.
Selling, General and Administrative Expenses Selling, general and administrative expenses were $84.8 million for the
three months ended January 31, 2000, an increase of $7.5 million or 9.6%,
from $77.4 million for the three months ended January 31, 1999. Selling,
general and administrative expenses as a percentage of net revenues,
decreased slightly to 25.3% of net revenues for the three months ended
January 31, 2000 as compared to 25.6% of net revenues for the three months
ended January 31, 1999. The slight decrease as a percentage of revenues
was primarily attributed to greater efficiencies achieved with increased
sales.
Income from Operations Income from operations was $7.6 million for the three months ended
January 31, 2000, a decrease of $1.8 million from $9.3 million for the
three months ended January 31, 1999. As a percentage of net revenues,
income from operations declined to 2.2% of net revenues for the three
months ended January 31, 2000 as compared to 3.1% for the three months
ended January 31, 1999 with .2% attributed to a decrease in depreciation
and amortization expense for the three months ended January 31, 2000
versus the three months ended January 31, 1999.
Interest Expense Interest expense was $4.4 million for the three months ended January 31,
2000, an increase of $.4 million from $4.0 million for the three months
ended January 31, 1999. As a percentage of net revenues, interest expense
remained constant for the three months ended January 31, 2000 as compared
to the three months ended January 31, 1999. Management attributes the
increase in interest expense to the higher debt outstandings and cost of
borrowing under
the senior credit facility used to finance growth and infrastructure.
Foreign Currency Translation Gain The net foreign currency translation gain of $1.7 million for the three
months ended January 31, 2000 primarily represents the netted non-cash
unrealized gain due primarily to the translation of parent company yen-
denominated debt to U.S. dollars at the spot rate, compared to a $2.4
million gain for the three month period ended January 31, 1999 which was
primarily the netted effect of an unrealized gain due primarily to the
translation of yen-denominated debt at the U.S. dollar spot rate
recognized at the parent level. The Company does not repatriate yen from
its Japanese subsidiary back to its parent.
Provision for Income Taxes There was a $2.0 million provision for income taxes for the three months
ended January 31, 2000 compared with a provision for income taxes of $3.3
million for the three months ended January 31, 1999.
Net Income As a result of the factors discussed above, the Company reported a
consolidated net income of $2.0 million for the three months ended January
31, 2000, versus net income of $2.4 million for the three months ended
January 31, 1999.
Six Months Ended January 31, 2000 Compared to Six Months
Ended January 31, 1999
Net Revenue Net revenues were $587.1 million for the six months ended January 31,
2000, an increase of $50.7 million (or an increase of $ 19.2 million
excluding the favorable effects of the U.S. dollar-Japanese yen exchange
rate movements), from $536.4 million for the six months ended January 31,
1999. Management attributed the increased revenue growth to, among other
things, a 1.1% increase in same store sales growth along with the addition
of new store openings.
Gross Profit Gross profit was $183.6 million for the six months ended January 31,
2000, an increase of $11.4 million or 6.6%, from $172.1 million for the
six months ended January 31, 1999. Gross profit as a percentage of net
revenues decreased to 31.3% of net revenues for the six months ended
January 31, 2000 as compared to 32.1 % of net revenues for the six months
ended January 31, 1999. Management attributes the decrease in gross
margin to a one-time video rental write-down due to the closure of a
majority of the company's video rental departments, Internet pricing
programs and a increase in certain domestic vendor pricing which was not
incrementally passed to the consumer.
Selling, General and Administrative Expenses Selling, general and administrative expenses were $152.0 million for the
six months ended January 31, 2000, an increase of $13.0 million or 9.3%,
from $139.0 million for the six months ended January 31, 1999. Selling,
general and administrative expenses as a percentage of net revenues,
remained constant for the six months ended January 31, 2000 as compared
to the six months ended January 31, 1999.
Income from Operations Income from operations was $18.8 million for the six months ended January
31, 2000, a decrease of $2.3 million from $21.1 million for the six
months ended January 31, 1999. As a percentage of net revenues, income
from operations declined to 3.2% of net revenues for the six months ended
January 31, 2000 as compared to 3.9% for the six months ended January 31,
1999.
Interest Expense Interest expense was $9.3 million for the six months ended January 31,
2000, an increase of $.7 million from $8.6 million for the six months
ended January 31, 1999. As a percentage of net revenues, interest expense
remained constant for the six months ended January 31, 2000 as compared to
the six months ended January 31, 1999. Management attributes the increase
in interest expense to the higher debt outstandings and an increase in
borrowing costs under the Senior Credit Facility used to finance growth
and infrastructure.
Foreign Currency Translation Loss Net foreign currency translation loss totaled $5.9 million for the six
months ended January 31, 2000 and primarily represented the netted effect
of an unrealized non-cash translation loss of primarily yen-denominated
debt translated at the U.S. dollar spot rate compared to a $9.5 million
loss for the six month period ended January 31, 1999 which was primarily
an unrealized loss due to the translation of MTS' yen-denominated debt
translated at the U.S. dollar spot rate. The Company does not repatriate
yen from its Japanese subsidiary back to its parent.
Provision for Income Taxes There was a $2.0 million provision for income taxes for the six months
ended January 31, 2000 compared with a $1.3 million provision for income
taxes for the six months ended January 31, 1999.
Net Income/Loss As a result of the factors discussed above, the Company reported a
consolidated net income of $.6 million for the six months ended January
31, 2000 compared to a breakeven position for the six months ended
January 31, 1999.
Liquidity and Capital Resources The Company's principal capital requirements are to fund working capital
needs, the opening of new stores, the refurbishment and expansion of
existing stores and its Internet business. The Company's primary
sources of working capital were borrowings under its senior credit
facility and short-term vendor financing.
The Company's cash and cash equivalents were $25.6 million as of January
31, 2000 compared with $30.0 million as of January 31, 1999. Net cash
provided by operating activities was $29.8 million for the six months
ended January 31, 2000 versus net cash provided by operating activities
of $11.2 million in the corresponding period in the prior year.
Operating cash outlfows for the six month period ended January 31, 2000
were primarily the result of a $15.4 million increase in inventory
build-up associated with the opening of additional stores and revenue
growth associated with the Company's Internet operation. Additionally,
the increase in inventory includes $3.9 million due to yen denominated
inventory translated at a lower U.S. dollar spot rate. This compares
to six months ended January 31 , 1999 which recognized a $7.1 million
inventory increase. The increase in cash provided by operations for
the six month period ended January 31, 2000 compared to the six month
period ended January 31, 1999 was primarily due to an increase in trade
payables associated with special buying terms for the holiday season.
The Company's investing activities consist principally of capital
expenditures for new store construction, system enhancements and store
relocations and remodels, Internet development and video rental
acquisitions. Capital expenditures totaled $24.8 million and $25.1
million during the six months ended January 31, 2000 and January 31,
1999, respectively. On a consolidated basis, the Company expects its
capital expenditures to be approximately $40 million over the next
twelve months.
Net cash used in financing resulted primarily from net borrowings under
the senior credit facility. Total funded debt increased $20.1 million
to $293.3 million as of January 31, 2000, from $273.2 million as of
January 31, 1999. The increase in total funded debt was largely due to
a net translation of yen denominated debt to U.S. dollars of $8.9
million. Borrowings under the Company's senior revolving credit
facility totaled $169.0 million for January 31, 2000, compared to $150.5
million for January 31, 1999. Unused availability under the revolving
senior credit facility as of January 31, 2000 was $95.0 million.
Based upon the Company's current operating levels and expansion plans,
management believes net cash flows from operating activities and the
capacity under its $275 million senior credit facility will be
sufficient to meet the Company's working capital and debt service
requirements and support the development of its short-and long-term
strategies for at least the next twelve months.
Market Risk
The Company is exposed to market risk from fluctuations in foreign
currency exchange rates and translation rates, which could impact its
consolidated financial position, result of operations and cash flows.
The Company manages its exposure to market risk through its regular
operating and financing activities and, if deemed appropriate, through
the use of derivative financial instruments. The Company uses
derivative financial instruments as risk management tools and not for
trading or speculative purposes and does not maintain such instruments
which may expose the company to significant market risk.
The Company uses foreign-exchange forward contracts to reduce its risk
in foreign currency-denominated transactions in order to minimize the
impact of a significant strengthening of the U.S. dollar against other
foreign currencies. Gains and losses on these instruments substantially
offset any losses and gains on the assets, liabilities and transactions
being hedged. The Company's primary net foreign currency market
exposure is the Japanese yen. Management does not foresee or expect any
significant changes in foreign currency exposure in the near future.
Seasonality
Retail music sales in the United States are typically higher during the
calendar fourth quarter as a result of consumer purchasing patterns due
to increased store traffic and impulse buying by holiday shoppers. As a
result, the majority of U.S. music retailers and, more specifically, the
mall-based retailers rely heavily on the calendar fourth quarter to
achieve annual sales and profitability results. The Company has had
reduced seasonal reliance due to its deep catalog merchandising
approach. In addition, international markets exhibit less fourth
quarter seasonality than U.S. markets and the Company's international
presence has historically reduced this reliance on the U.S. holiday
shopping season.
Minimum Wage Increases
We employ a number of sales associates and other personnel who are paid
on an hourly basis. Many of these hourly employees are paid at or near
the minimum wage. Increases in the minimum wage result in an increase
in wages of those hourly employees. It can also result in an increase
in the wages of more highly compensated hourly employees. Increases in
the minimum wage have had a significant effect on our compensation
expense during prior periods. Any future increases may have a material
adverse effect on our results of operations and financial condition.
Foreign Exchange Management
Since a substantial portion of our operations and revenue occur outside
the United States, our results can be significantly impacted by changes
in foreign currency exchange rates. The Company has substantial
operations and assets located outside the United States, primarily in
the United Kingdom and Japan. With respect to international operations,
principally all of Tower's revenues and costs (including borrowing
costs) are incurred in the local currency, except that certain inventory
purchases are tied to U.S. dollars. The Company's financial performance
on a U.S. dollar-denominated basis has historically been affected by
changes in currency exchange rates. Changes in certain exchange rates
could adversely affect the Company's business, financial condition and
results of operations.
Year 2000 Compliance As previously reported, over the past several years the Company
developed and implemented a plan to address the anticipated impacts of
the Year 2000 problem on our information technology (IT) systems and on
non-IT systems involving embedded chip technologies. We also surveyed
selected third parties to determine the status of their Year 2000
compliance programs. In addition, we developed contingency plans
specifying what the Company would do if we or important third parties
experienced disruptions to critical business activities as a result of
the Year 2000 problem. Our Company's Year 2000 plan was completed in
all material respects prior to the anticipated Year 2000 failure dates.
As of March 15, 2000, the Company has not experienced any materially
important business disruptions or system failures as a result of Year
2000 issues, nor is it aware of any Year 2000 issues that have impacted
its suppliers or other significant third parties to an extent
significant to the Company. However, Year 2000 compliance has many
elements and potential consequences, some of which may not be
foreseeable or may be realized in future periods. Consequently, there
can be no assurance that unforeseen circumstances may not arise, or that
the Company will not in the future identify equipment or systems which
are not Year 2000 compliant. As of January 31, 2000, the Company's
total incremental costs (historical plus estimated future costs) of
addressing Year 2000 issues are estimated to be approximately $1.5
million, of which approximately $1.3million has been incurred. These
costs are being funded through operating cash flow. These amounts do
not include costs associated with replacement of computerized systems or
equipment in cases where replacement was not accelerated due to Year
2000 issues.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
(b) Reports on Form 8-K.
None
MTS, INCORPORATED
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.
CONSOLIDATED BALANCE SHEETS
AS OF JANUARY 31, 2000, 1999 AND JULY 31, 1999
(DOLLARS IN THOUSANDS)
UNAUDITED
JANUARY 31 JANUARY 31, JULY 31,
2000 1999 1999
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ASSETS
Current Assets:
Cash and cash equivalents................ $25,556 $29,794 $24,705
Receivables, net......................... 28,604 26,012 26,378
Merchandise inventories.................. 287,088 268,060 271,713
Prepaid expenses......................... 11,106 8,941 11,212
Deferred tax assets...................... 9,163 11,786 8,241
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Total current assets................ 361,517 344,593 342,249
Fixed assets, net.......................... 212,642 201,179 196,864
Deferred tax assets........................ 13,326 12,425 9,794
Other assets............................... 38,270 35,255 37,250
----------- ----------- -----------
Total assets........................ $625,755 $593,452 $586,157
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term debt..... $3,371 $2,945 $2,971
Accounts payable......................... 168,412 146,603 150,332
Accrued liabilities...................... 35,849 32,831 32,942
Income taxes payable..................... 1,859 5,216 786
Deferred revenue, current portion........ 8,066 8,124 3,098
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Total current liabilities........... 217,557 195,719 190,129
Long-term Liabilities:
Long-term debt, less current maturities.. 289,931 270,248 280,169
Deferred revenue, less current portion... 154 163 157
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Total liabilities................... 507,642 466,130 470,455
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Commitments and contingencies
Shareholders' Equity:
Common stock:
Class B, no par value; 10,000,000
shares authorized; 1,000 shares issued
and outstanding at January 31, 2000,
January 31, 1999, and July 31, 1999..... 6 6 6
Retained earnings........................ 136,856 145,074 136,278
Accumulated other comprehensive income... (18,749) (17,758) (20,582)
----------- ----------- -----------
Total shareholders' equity.......... 118,113 127,322 115,702
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Total liabilities and
shareholders' equity.............. $625,755 $593,452 $586,157
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CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED JANUARY 31, 2000 AND 1999
AND THE SIX MONTHS ENDED JANUARY 31, 2000 AND 1999
(DOLLARS IN THOUSANDS)
(UNAUDITED)
Three Months Ended Six Months Ended
January 31, January 31,
----------------------- -----------------------
2000 1999 2000 1999
----------- ----------- ----------- -----------
Net revenue...................... $335,639 $302,788 $587,109 $536,386
Cost of sales.................... 236,902 209,769 403,540 364,256
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Gross profit................... 98,737 93,019 183,569 172,130
Selling, general and
administrative expenses........ 84,841 77,391 152,009 139,031
Depreciation and amortization.... 6,345 6,285 12,740 11,975
----------- ----------- ----------- -----------
Income from operations......... 7,551 9,343 18,820 21,124
Other income and (expenses):
Interest expense............... (4,405) (3,981) (9,283) (8,568)
Foreign currency translation
loss)....................... 1,695 2,404 (5,862) (9,491)
Other income and (expenses).... (861) (2,096) (1,138) (1,771)
----------- ----------- ----------- -----------
Income before taxes.......... 3,980 5,670 2,537 1,294
Provision for income taxes....... 1,973 3,264 1,959 1,304
----------- ----------- ----------- -----------
Net income (loss)............ 2,007 2,406 578 (10)
----------- ----------- ----------- -----------
Basic and diluted earnings
per share:
On net income(loss)........ $2,007.34 $2,406.01 $578.16 ($10.21)
=========== =========== =========== ===========
FOR THE SIX MONTHS ENDED JANUARY 31, 2000 AND 1999
(DOLLARS IN THOUSANDS)
(UNAUDITED)
JANUARY 31,
---------------------
2000 1999
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)....................................... $578 ($10)
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Depreciation and amortization.......................... 15,099 14,162
Provision for losses on accounts receivable........... 217 159
Loss on disposal of depreciable assets................. 2,674 3,065
Exchange loss.......................................... 4,969 11,154
Other non-cash (income) expense........................ 32 (267)
Provision for deferred taxes........................... (3,288) (4,974)
(Decrease) increase in cash resulting from changes in:
Accounts receivable................................. (2,226) (2,917)
Inventories......................................... (15,375) (7,057)
Prepaid expenses.................................... 106 (2,322)
Accounts payable.................................... 18,080 (10,840)
Accrued liabilities and taxes payable............... 3,980 6,203
Deferred revenue.................................... 4,965 4,866
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Net cash provided by operating
activities.................................... 29,811 11,222
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of fixed assets............................. (24,828) (25,066)
Acquisition of investments.............................. (984) (1,390)
Increase in deposits.................................... (90) (78)
Refunds of deposits..................................... 11 157
Increase in intangibles................................. (12) (847)
---------- ----------
Net cash used in investing activities............ (25,903) (27,224)
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Loans to shareholders, officer and employees............ (334) --
Proceeds from employee loan repayments.................. 16 15
Principal payments under long-term financing
agreements............................................ (57,782) (1,219)
Proceeds from issuance of long-term financing
agreements............................................ 45,000 21,982
---------- ----------
Net cash (used in)/provided by financing activiti (13,100) 20,778
---------- ----------
Effect of exchange rate changes on cash.................... 10,043 10,409
---------- ----------
Net increase in cash and cash equivalents........ 851 15,185
Cash and cash equivalents, beginning of period............. 24,705 14,609
---------- ----------
Cash and cash equivalents, end of period................... $25,556 $29,794
========== ==========
Cash paid for interest..................................... $9,546 $8,709
========== ==========
Cash paid for income taxes................................. $7,857 $4,308
========== ==========
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED JANUARY 31, 2000 AND 1999
(DOLLARS IN THOUSANDS)
UNAUDITED
2000 1999
----------- -----------
Net income (loss).......................... $578 ($10)
Other comprehensive income, net of tax:
Foreign currency translation............ 1,833 6,534
----------- -----------
Comprehenive income........................ $2,411 $6,524
=========== ===========
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
SIGNATURES
MTS, INCORPORATED
(Registrant)
By:
/s/ DeVaughn D. Searson
DeVaughn D. Searson
EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
(Principal Financial and Accounting Officer)
| Date: March 16,2000 |
EXHIBIT INDEX
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