AMBASSADOR FOOD SERVICE CORPORATION
P.O. BOX 419586
Kansas City, Missouri 64111
May 17, 1997
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
Pursuant to the requirements of the Securities Exchange Act of
1934, we are transmitting herewith the attached Form 10QSB.
Sincerely,
AMBASSADOR FOOD SERVICE CORP.
Richard A. Mitchell
Richard A. Mitchell, Vice President
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended February 27, 1997
Commission File Number 0-1744
Ambassador Food Services Corporation
Delaware 244-0656199
(State or other jurisdiction of (IRS Employer Identification #)
incorporation or organization)
Post Office Box 419586 3269 Roanoke Road
Kansas City, Missouri 64141-6586 Kansas City, Missouri 64111-3785
(Address of principal executive offices)
816-561-6474
(Registrant's Telephone Number, Including Area Code)
No changes
(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 twelve 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 ninety days.
YES X NO
Indicate the number of shares outstanding of each of the issuer's
classes of common stock as of the close of the period covered by
this report:
Common Stock ($1.00 par value) 755,906 shares outstanding as of
02/27/97.
AMBASSADOR FOOD SERVICES CORPORATION
AND SUBSIDIARIES
I N D E X
Page
Number
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets
February 27, 1997 (Unaudited) and May 30, 1996 3
Consolidated Statements of Income
Six months ended February 27, 1997
(Unaudited) and February 29, 1996 (Unaudited) 4
Condensed Consolidated Statements of Cash Flows
Six months ended February 27, 1997 (Unaudited) 4
Notes to Condensed Consolidated
Financial Statements (Unaudited) 5
Item 2.Management's Discussion and Analysis of
Financial Condition and Results of Operations 5 - 6
Signatures 6
AMBASSADOR FOOD SERVICES CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
2/27/97 5/30/96
ASSETS
Cash $ 507,546 $ 402,768
Accounts & Notes Receivable 1,903,279 1,768,211
Inventories 690,698 593,820
Other Current 169,849 410,173
Total Current Assets 3,271,372 3,174,972
Property,Plant and Equip.-Net 2,408,253 2,129,664
Location Contracts 1,263,927 1,242,656
Other Long Term Assets 1,000,036 1,130,074
Total Assets 7,943,588 7,677,366
LIABILITIES AND STOCKHOLDERS' EQUITY
Trade Accounts Payable 2,126,078 2,131,857
Accrued Expenses and Other 1,009,966 679,549
Current Maturities of
Long-Term Debt 655,224 601,937
Line of Credit 709,122 -0-
Total Current Liabilities 4,500,390 3,413,343
Line of Credit -0- 618,798
Long-Term Debt 1,405,962 1,374,817
Other Long Term Liabilities 751,719 847,172
Stockholders' Equity:
Common Stock 1,009,230 1,009,230
Additional Paid-In Capital 718,291 718,291
Retained Earnings (145443) (20,380)
1,582,078 1,707,141
Less: Treasury Stock 296,561 283,905
1,285,517 1,423,236
Total Liabilities &
Stockholders' Equity $ 7,943,588 $ 7,677,366
Note: The balance sheet at May 30, 1996 has been taken from the
audited financial statements at that date, and condensed. See
accompanying notes to consolidated condensed financial statements.
AMBASSADOR FOOD SERVICES CORPORATION
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
2/27/97
Net Cash provided (used)
by continuing operations 708,708
Net Cash provided (used)
by investing activities (716,810)
Net Cash provided (used)
by financing activities 112,880
Net Incr (Decr) in Cash 104,778
Cash:
Beginning of period (June) 402,768
End of period (November) 507,546
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
26 Weeks 26 Weeks
Ended Ended
02/27/97 02/29/96
Total Revenues 17,337,250 14,992,896
Costs and Expenses:
Cost of Products Sold 7,250,263 6,023,541
Payroll Expense 4,789,861 4,237,618
Other Operating Expenses 2,234,517 1,716,965
Selling and Administrative 2,455,581 2,251,956
Depreciation and Amortization 449,020 454,699
Interest 283,071 169,769
Total Expenses 17,462,313 14,854,516
Income from Cont. Ops. (BIT) (125,063) 138,380
Provision for Income Taxes -0- -0-
Net (Loss) Earnings (125,063) 138,380
Earnings per Common Share (.17) .20
AMBASSADOR FOOD SERVICES CORPORATION
AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The condensed consolidated balance sheet as of February 27, 1997, the
consolidated statements of income for the nine month periods ended
February 27, 1997, and February 29, 1996, and the condensed consolidated
statements of cash flows for the nine month periods then ended have
been prepared by the company, without audit. In the opinion of
management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position, results
of operations, and cash flows at February 27, 1997 and for all periods
presented have been made.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested
that these condensed consolidated financial statements be read in
conjunction with the financial statements and notes thereto included in
the Company's May 30, 1996 annual report to shareholders. The results
of operations for the periods ended February 27, 1997 and February 29, 1996
are not necessarily indicative of the operating results for the full year.
2. INVENTORIES
Inventories consist of raw materials and supplies.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION
Revenues for the Second Quarter of the fiscal year ending February 27, 1997
show an 15.6% increase from the same period for 1996. This increase
reflects a 18.6% sales increase in the Midwest Food Service Operations, a 8.0%
increase in the Company's New York Food Service revenues and a 13.0% increase in
Squire Maintenance operations. This growth in sales reflects the impact of
excellent sales efforts as well as the additional revenues due to the
acquisition in the Des Moines market in the Fourth Quarter of 1996.
Cost of products sold and operating expenses increased as a percentage of
sales from prior year levels. This is a continuation of deterioration in
margins of the Company's Midwest Food Operations as well as the New York Food
Service. Management is working to improve margins through increased pricing
in the Ambassador accounts, obtaining competitive vendor price levels and
through stricter cost controls.
Financing continues to be available for necessary capital investment
through the Company's equipment suppliers. Because profitability has continued
to lag behind sales growth, the Company's cash position has tightened.
Management is concentrating its efforts upon improving margins to provide
needed cashflow from operations.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, there-unto duly
authorized.
AMBASSADOR FOOD SERVICES CORPORATION
(Registrant)
By
Arthur D. Stevens Date
President/Chairman of the Board
By
Richard A. Mitchell Date
Assistant Secretary
[ARTICLE] 5
<TABLE>
<S> <C>
[PERIOD-TYPE] OTHER
[FISCAL-YEAR-END] MAY-29-1997
[PERIOD-END] FEB-27-1997
[CASH] 507,546
[SECURITIES] 0
[RECEIVABLES] 1,903,279
[ALLOWANCES] 0
[INVENTORY] 690,698
[CURRENT-ASSETS] 3,271,372
[PP&E] 8,621,075
[DEPRECIATION] 6,212,822
[TOTAL-ASSETS] 7,943,588
[CURRENT-LIABILITIES] 4,500,390
[BONDS] 0
[COMMON] 1,009,230
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[OTHER-SE] 0
[TOTAL-LIABILITY-AND-EQUITY] 7,943,588
[SALES] 17,337,250
[TOTAL-REVENUES] 17,337,250
[CGS] 7,250,263
[TOTAL-COSTS] 17,462,313
[OTHER-EXPENSES] 0
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 283,071
[INCOME-PRETAX] (125,063)
[INCOME-TAX] 0
[INCOME-CONTINUING] (125,063)
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] (125,063)
[EPS-PRIMARY] (.17)
[EPS-DILUTED] (.17)
</TABLE>
