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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) February 1, 1999
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HomeBase, Inc.
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(Exact name of registrant as specified in its charter)
DELAWARE
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(State or other jurisdiction of incorporation)
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1-10259 33-0109661
(Commission File number) (I.R.S. Employer Identification No.)
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Support Center Offices 3345 Michelson Drive, Irvine, California 92715
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (949) 442-5000
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(Former name or former address, if changed since last report)
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INFORMATION TO BE INCLUDED IN THE REPORT
Item 5. Other Events.
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On February 1, 1999, HomeBase, Inc. ("HomeBase") issued a press release in
the form attached hereto as Exhibit 99.1. The press release reports HomeBase's
announcement of its preliminary results for the fourth quarter and fiscal year
ended January 30, 1999 and of a new strategic program aimed at enhancing sales
and increasing market share, with related additional expenditures that are
expected to have an adverse effect on next year's net income.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
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c. Exhibits
99.1 February 1, 1999 Press Release of HomeBase.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be filed on its behalf by
the undersigned hereunto duly authorized.
Date: February 2, 1999
HomeBase, Inc.
By /s/ Allan P. Sherman
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Allan P. Sherman
President and Chief Executive Officer
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Contact: Suki Shattuck
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HomeBase, Inc.
(949) 442-5448
Roger S. Pondel/Michele Feller
Pondel Parsons & Wilkinson
(310) 207-9300
FOR IMMEDIATE RELEASE
HOMEBASE REPORTS PRELIMINARY RESULTS FOR 4TH QUARTER, FULL YEAR;
ANNOUNCES NEW SALES STRATEGY
Irvine, California -- February 1, 1999 -- HomeBase, Inc. (NYSE:HBI)
today announced preliminary results for the fourth quarter and fiscal year
ended January 30, 1999. The company also announced a new strategic program
aimed at enhancing sales and increasing market share, with related
additional expenditures that are expected to have an adverse effect on next
year's net income.
The company expects net income for the year ended January 30, 1999 to
be approximately $22 million, or, $0.54 per diluted share, compared with
pro forma net income for the prior year of $17.8 million, or $0.47 per
diluted share, excluding a special charge taken in the third quarter. Net
income for the fourth quarter ended January 30, 1999 is expected to be
approximately $200,000, or $0.01 per share, compared with a loss from
continuing operations of $3.9 million, or $0.10 per share, for the
corresponding prior-year period.
Sales for the 52-week year ended January 30, 1999 totaled $1.44
billion, compared with $1.48 billion for the 53-week year ended January 31,
1998. This reflects a comparable 52-week same store sales decline of 0.5%.
For the current 13-week fourth quarter, sales were $309 million, compared
with sales of $328 million for the 14-week fourth quarter last year. Same
store sales for the comparable 13 weeks of the fourth quarter were up 2.3%
from a year ago.
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The company plans to report actual results for the fourth quarter and
full fiscal year on March 2.
Allan Sherman, president and chief executive officer, said the company
is implementing a new strategic program designed to enhance service,
increase customer traffic and improve same store sales. The initiatives
involve an incremental investment next year of approximately $13 million in
payroll and advertising costs, which is designed to increase the number of
sales people in each store and to promote the company's stores and products
to more potential customers. In addition, HomeBase will increase inventory
per store by approximately 10%, as a means of further enhancing customer
service.
"The competition in our markets is expected to intensify," Sherman
added. "HomeBase has proven its ability to withstand competition in the
past, and will again. In addition to our current program of accelerating
store openings, the new initiatives will be instrumental in helping us gain
market share, fortify the company's position in the West and provide long-
term value to HomeBase stockholders."
In a departure from the company's practice of not announcing
anticipated results of operations for the coming year, HomeBase said the
increase in inventory, payroll and advertising expenses should result in 3%
to 5% same store sales growth and diluted earnings per share of
approximately $0.39 to $0.43 for the fiscal year ended January 29, 2000.
The company indicated that despite the negative short-term impact to net
income, this program will better position the company for long-term growth
and success.
Headquartered in Irvine, California, HomeBase, Inc. operates 84 home
improvement warehouses, averaging 103,000 square feet, in 10 western
states. HomeBase, Inc. is traded on the New York Stock Exchange under the
symbol "HBI" and can be located on the Internet at http://www.homebase.com.
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Matters discussed in this document include forward-looking statements that
involve risks and uncertainties that could cause results to differ
materially from those expressed. Such risks and uncertainties include, but
are not limited to, the company's ability to successfully implement the new
operating and sales strategy, the competitive marketplace and the factors
set forth in the company's annual report on Form 10-K for the fiscal year
ended January 31, 1998 under the heading "Risk Factors" and in the
company's other filings with the Securities and Exchange Commission.
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