SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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 August 1, 1998 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 No. 000-19372
CATHERINES STORES CORPORATION
(exact name of registrant as specified in its charter)
Tennessee 62-1350411 (State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
3742 Lamar Avenue, Memphis, Tennessee, 38118 (Address of
principal executive offices)
Registrant's telephone number, including area code (901) 363-3900
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).
Yes X No
Indicate the number of shares outstanding of each of the registrant's classes of
common stock as of the latest practicable date.
As of September 2, 1998 there were 7,247,306 shares of Catherines
Stores Corporation common stock outstanding.
<PAGE>
CATHERINES STORES CORPORATION
FORM 10-Q
August 1, 1998
Table of Contents
PART 1 - FINANCIAL INFORMATION
Consolidated Statements of Income 3
Consolidated Balance Sheets 4
Consolidated Statements of Cash Flows 5
Notes to Consolidated Financial Statements 6-9
Management's Discussion and Analysis of Financial
Condition and Results of Operations 10-14
PART 2 - OTHER INFORMATION 15
<PAGE>
PART 1 - FINANCIAL INFORMATION
CATHERINES STORES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
Thirteen weeks ended Twenty-six weeks ended
August 1, August 2, August 1, August 2,
1998 1997 1998 1997
---- ---- ---- ----
Net sales $ 74,826,611 $ 70,663,687 $151,279,005 $141,631,880
Cost of sales,
including buying and
occupancy costs 49,208,328 48,560,541 100,317,466 97,231,371
------------ ------------ ------------ ------------
Gross margin 25,618,283 22,103,146 50,961,539 44,400,509
Selling, general and
administrative
expenses 19,314,462 18,716,370 39,745,501 38,370,161
Amortization of
intangible assets 275,072 248,382 529,380 523,261
------------ ------------ ------------ ------------
Operating income
before store closing
costs 6,028,749 3,138,394 10,686,658 5,507,087
Store closing costs
(Note 7) 11,099 0 199,755 0
------------ ------------ ------------ ------------
Operating income 6,017,650 3,138,394 10,486,903 5,507,087
Interest expense, net 154,139 328,038 433,787 650,462
------------ ------------ ------------ ------------
Income before income
taxes 5,863,511 2,810,356 10,053,116 4,856,625
Provision for income
taxes 2,405,000 1,156,000 4,123,000 1,989,000
------------ ------------ ------------ ------------
Net income $ 3,458,511 $ 1,654,356 $ 5,930,116 $ 2,867,625
============ ============ ============ ============
Net income per common
share (Note 6) $ 0.48 $ 0.23 $ 0.82 $ 0.40
============ ============ ============ ============
Diluted net income
per common share
(Note 6) $ 0.47 $ 0.23 $ 0.80 $ 0.40
============ ============ ============ ============
The accompanying notes are an integral part of these consolidated financial
statements.
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<PAGE>
<TABLE>
<CAPTION>
CATHERINES STORES CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<S> <C> <C>
August 1, 1998 January 31, 1998
-------------- ----------------
ASSETS
Current Assets:
Cash and cash equivalents $10,189,692 $3,089,290
Receivables 2,480,811 2,580,025
Merchandise inventory 51,895,152 48,310,215
Prepaid expenses and other 3,866,416 4,044,144
Deferred income taxes 2,504,000 2,504,000
------------------- --------------------
Total current assets 70,936,071 60,527,674
------------------- --------------------
Property and Equipment, at cost:
Land 500,000 500,000
Leasehold improvements 24,012,657 23,213,674
Fixtures and equipment 29,750,194 28,573,919
Equipment under capital leases 13,676,776 13,356,177
Improvements in process 1,174,100 830,144
------------------- --------------------
69,113,727 66,473,914
Less accumulated depreciation and amortization (36,306,134) (32,398,729)
------------------- --------------------
32,807,593 34,075,185
------------------- --------------------
Deferred Income Taxes 435,000 435,000
Other Assets and Deferred Charges, less accumulated
amortization of $1,793,933 and $1,716,072
2,423,182 2,506,096
Goodwill, less accumulated amortization of
$5,231,526 and $4,886,858
22,391,340 22,739,081
------------------- --------------------
$128,993,186 $120,283,036
=================== ====================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $23,364,409 $21,761,405
Accrued expenses (Note 3) 17,684,674 14,750,159
Current maturities of long-term bank and other debt 2,139,182 2,853,585
------------------- --------------------
Total current liabilities 43,188,265 39,365,149
------------------- --------------------
Long-Term Bank and Other Debt, less current maturities
(Note 4) 9,646,699 10,788,920
Stockholders' Equity:
Preferred stock, $.01 par value, 1,000,000 shares
authorized, none issued and outstanding
--- ---
Common stock, $.01 par value, 50,000,000 shares
authorized,7,247,306 and 7,231,070 shares issued and
outstanding
72,473 72,311
Additional paid-in capital 46,628,401 46,529,424
Retained earnings 29,457,348 23,527,232
------------------- --------------------
Total stockholders' equity 76,158,222 70,128,967
------------------- --------------------
$128,993,186 $120,283,036
=================== ====================
</TABLE>
The accompanying notes are an integral part of these consolidated
balance sheets.
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<PAGE>
CATHERINES STORES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Twenty-six weeks ended
August 1, August 2,
1998 1997
---- ----
Cash Flows from Operating Activities:
Net income $5,930,116 $2,867,625
Adjustments to reconcile net income to
net cash provided by operating activities--
Depreciation and amortization 4,514,293 4,623,442
Change in reserve for store closing costs 29,869 0
(Note 7)
Net change in current assets and 1,760,579 (126,803)
liabilities (Note 2)
Change in other noncash reserves (560,924) (793,444)
Change in other assets (71,147) (175,728)
------------------------------------
Total adjustments 5,672,670 3,527,467
------------------------------------
Net cash provided by operating activities 11,602,786 6,395,092
------------------------------------
Cash Flows from Investing Activities:
Capital expenditures (2,366,131) (2,302,770)
------------------------------------
Net cash used in investing activities (2,366,131) (2,302,770)
------------------------------------
Cash Flows from Financing Activities:
Sales of common stock 99,139 72,078
Proceeds from long-term bank
and other debt 6,919,000 0
Principal payments of long-term bank
and other debt (9,154,392) (3,662,598)
------------------------------------
Net cash used in financing activities (2,136,253) (3,590,520)
------------------------------------
Net Increase in Cash and Cash Equivalents 7,100,402 501,802
Cash and Cash Equivalents, beginning of period 3,089,290 2,992,339
-----------------------------------
Cash and Cash Equivalents, end of period $10,189,692 $3,494,141
===================================
The accompanying notes are an integral part of these consolidated financial
statements.
-5-
<PAGE>
CATHERINES STORES CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(1) General
In the opinion of management, the accompanying unaudited consolidated
financial statements contain all adjustments (consisting of normal recurring
adjustments) which management considers necessary to present fairly the
consolidated financial position of Catherines Stores Corporation ("Stores") and
its wholly owned subsidiaries as of August 1, 1998 and January 31, 1998, the
consolidated results of their operations for the thirteen and twenty-six weeks
ended August 1, 1998 and August 2, 1997 and their cash flows for the twenty-six
weeks ended August 1, 1998 and August 2, 1997. Stores and its subsidiaries are
collectively referred to as the "Company". The results of operations for the
thirteen and twenty-six week periods may not be indicative of the results for
the entire year.
These statements should be read in conjunction with the Company's
audited financial statements and related notes which have been incorporated by
reference in the Company's Form 10-K for the year ended January 31, 1998.
Accordingly, significant accounting policies and other disclosures necessary for
complete financial statements in conformity with generally accepted accounting
principles have been omitted since such items are reflected in the Company's
audited financial statements and related notes thereto.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make certain estimates and
assumptions that affect the reported amounts of assets and liabilities, and
disclosure of contingent assets and liabilities, at the date of the financial
statements, and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
(2) Statements of Cash Flows
The changes in current assets and liabilities reflected in the
statements of cash flows were as follows:
Twenty-six weeks ended
August 1, August 2,
1998 1997
--------- ---------
Increase (decrease) in cash and
cash equivalents-
Receivables $85,130 $845,595
Merchandise inventory 3,064,062 6,537,213
Prepaid expenses and other 177,728 (1,114,197)
Accounts payable (4,507,652) (5,866,550)
Accrued expenses 2,941,311 (528,864)
--------- ---------
Total $1,760,579 $(126,803)
========== ==========
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<PAGE>
Interest paid during the twenty-six weeks ended August 1, 1998 and
August 2, 1997 was approximately $118,000 and $632,000, respectively. Income
taxes paid during the twenty-six weeks ended August 1, 1998 and August 2, 1997
were approximately $2,568,000 and $1,148,000, respectively.
(3) Accrued Expenses
Accrued expenses consisted of the following:
August 1, January 31,
1998 1998
----------- -----------
Payroll and related benefits $3,851,469 $3,252,177
Taxes other than income taxes 1,402,358 1,059,127
Rent and other related costs 2,362,106 2,252,587
Deferred revenues 1,990,081 1,819,288
Reserve for earned discounts 1,421,000 1,140,000
Reserve for store closing costs 1,145,080 1,115,211
Income taxes 1,922,366 245,161
Other 3,590,214 3,866,608
--------- ---------
Total $17,684,674 $14,750,159
=========== ===========
(4) Long-Term Bank and Other Debt
Long-term bank and other debt consisted of the following:
August 1, January 31,
1998 1998
----------- -----------
Due to banks:
Term notes $ 0 $ 1,250,000
Working capital notes 0 7,000,000
Mortgage note 6,860,890 0
Other:
Capital lease and other obligations 4,924,991 5,392,505
------------ ------------
11,785,881 13,642,505
Less current maturities (2,139,182) (2,853,585)
------------ ------------
Total $ 9,646,699 $ 10,788,920
============ ============
On February 27, 1998, the Company entered into a new mortgage financing
agreement and amended the existing bank credit agreement. The new mortgage
financing agreement provides a $6,919,000 mortgage facility with a seven-year
term and a 20-year amortization period. The interest rate on the mortgage note
is fixed at 7.5%. Proceeds from the note were used to repay the Company's
outstanding term loan and to reduce amounts outstanding under the working
capital facility. The existing bank credit agreement was amended to reduce the
amount available from $28 million to $25 million, including the swing line of
credit, and to increase the interest rate to the agent bank's prime rate or
LIBOR plus 2 1/4%, at the Company's option. Amounts available under the new
agreement are based on the Company's eligible receivables and inventories.
-7-
<PAGE>
At August 1, 1998, the Company had approximately $16,600,000 available
under its combined working capital and swing line facility. Outstanding letters
of credit were approximately $4,900,000 at August 1, 1998. During the twenty-six
weeks ended August 1, 1998, the Company entered into supplements to a capital
lease agreement for the purpose of obtaining laptop computers and general office
equipment. The cost of this equipment, approximately $379,000, was financed by
capital leases.
(5) Leases
During the twenty-six weeks ended August 1, 1998, the Company amended
or extended leases for 50 stores, which increased future minimum rental payments
by approximately $9,663,000 since January 31, 1998. Total future minimum rental
payments under all noncancelable operating leases with initial or remaining
lease terms of one year or more are approximately $73,558,000.
Total rent expense for all operating leases was as follows:
Twenty-six Weeks Ended
August 1, August 2,
1998 1997
----------- -----------
Minimum rentals $10,421,365 $10,639,071
Contingent rentals 153,285 145,071
------- -------
Total $10,574,650 $10,784,142
=========== ===========
(6) Net Income Per Common Share
The reconciliation of net income per common share and diluted net
income per common share is as follows:
Diluted
Net Income Net Income
Per Per
Common Stock Common
Share Options Share
------------ ----------- -----------
Twenty-six weeks ended August 1, 1998:
Net income $5,930,116 $5,930,116
Weighted average shares 7,237,835 143,490 7,381,325
---------- ----------
Per share amount $ 0.82 $ 0.80
========== ==========
Twenty-six weeks ended August 2, 1997:
Net income $2,867,625 $2,867,625
Weighted average shares 7,203,255 56,515 7,259,770
---------- ----------
Per share amount $ 0.40 $ 0.40
========== ==========
Thirteen weeks ended August 1, 1998:
Net Income $3,458,511 $3,458,511
Weighted average shares 7,242,973 161,731 7,404,704
---------- ----------
Per share amount $ 0.48 $ 0.47
=========== ==========
Thirteen weeks ended August 2, 1997:
Net Income $1,654,356 $1,654,356
Weighted average shares 7,207,978 51,959 7,259,937
---------- ----------
Per share amount $ 0.23 $ 0.23
========== ==========
(7) Store Closing Costs
-8-
<PAGE>
The Company reviewed its store base in late fiscal 1997 and committed to a
plan to close 30 underperforming stores upon lease termination or by settlement
with the landlords. Seven underperforming stores were closed during the first
half of fiscal 1998 at a cost of approximately $199,000 and six additional
stores have scheduled closing dates during the remainder of fiscal 1998. The
remaining stores' leases are still being negotiated with the landlords.
During the six months ended August 1, 1998, approximately $170,000 of
cash payments were made related to the stores closed.
-9-
<PAGE>
Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Forward-Looking Statements
This outlook contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. Such forward-looking
statements are based on current expectations that are subject to known and
unknown risks, uncertainties and other factors that could cause actual results
to differ materially from those contemplated by the forward-looking statements.
Such factors include, but are not limited to, the following: general economic
conditions; competitive factors and pricing pressures; the Company's ability to
predict fashion trends; consumer apparel buying patterns; adverse weather
conditions and inventory risks due to shifts in market demand. The Company does
not undertake to publicly update or revise the forward-looking statements even
if experience or future changes make it clear that projected results expressed
or implied therein will not be realized.
Overview
The Company's net income for the thirteen week period ended August 1,
1998 was $3,459,000 compared to $1,654,000 in the thirteen week period ended
August 2, 1997. Operating income margins were 8.0% for the second quarter of
1998 compared to 4.4% in 1997.
Net income for the twenty-six week period ended August 1, 1998 was
$5,930,000 compared to $2,868,000 in the twenty-six week period ended August 2,
1997. Operating income for the first half of 1998 almost doubled the operating
income for the first half of 1997. Operating income margins were 6.9% for the
first half of 1998 compared to 3.9% for the first half of 1997.
Liquidity and Capital Resources
The Company's cash provided by operations was $11,603,000 during the
twenty-six weeks ended August 1, 1998, compared to cash provided by operations
of $6,395,000 during the twenty-six weeks ended August 2, 1997. The increase in
cash flow provided by operations is primarily attributable to an increase in net
income and a decrease in working capital. The Company's working capital, net of
cash and cash equivalents, was $17,558,000 at August 1, 1998 compared to
$18,073,000 at January 31, 1998. The Company's internally generated cash flow
financed its operating requirements, capital expenditures and debt service
during the twenty-six week period ended August 1, 1998.
The Company maintains a merchant services agreement with a third party
credit processor. This agreement provides for the Company to sell, without
recourse, accounts receivable from private label credit card sales. The third
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<PAGE>
party provides all authorization, billing and collection services for these
accounts. The five-year agreement, which expires in January 2000, automatically
renews unless terminated by either party or by mutual agreement.
Capital Expenditures
The Company incurred approximately $1,800,000 to relocate, remodel or
expand existing stores during the first half of 1998. The Company estimates that
fiscal 1998 capital expenditures will be approximately $7,000,000 to $8,000,000
of which an estimated $6,000,000 will be used for the opening of three new
locations and the remodeling, relocation and expansion of approximately 31 other
locations. An additional $1,500,000 will be used to purchase new information
technology to upgrade the merchandise planning and allocation systems and the
customer profile database system. The remainder of capital expenditures are to
upgrade existing computer systems, add additional software technology and to
maintain existing facilities.
Banking Arrangements
In February 1998, the Company entered into a new mortgage financing
agreement and amended the existing bank credit agreement. The Company's prior
bank credit agreement provided a $5,000,000 term loan, a working capital
facility of $25,000,000 and a swing line of credit of $3,000,000 with the
Company's agent bank. The term loan required quarterly principal payments of
$250,000. The working capital facility could have been used for letters of
credit. The interest rate was the bank's prime rate or LIBOR plus 1 1/4% , at
the Company's option.
The new mortgage financing agreement provides a $6,919,000 mortgage
facility with a seven-year term and a 20-year amortization period. The interest
rate on the mortgage note is fixed at 7.5%. Proceeds from the note were used to
repay the term loan and to reduce the amounts outstanding under the working
capital facility. The existing bank credit facility was amended to reduce the
amount available from $28,000,000 to $25,000,000, including the swing line of
credit, and to increase the interest rate to the agent bank's prime rate or
LIBOR plus 2 1/4%, at the Company's option. The new agreement expires June 30,
2001.
At August 1, 1998, the Company had approximately $16,600,000 available
under its combined working capital and swing line facility and approximately
$4,900,000 in outstanding letters of credit.
The Company believes that its internally generated cash flow, together
with borrowings under the bank credit agreement, will be adequate to finance the
Company's operating requirements, debt repayments and capital needs during the
foreseeable future.
Results of Operations
Thirteen Weeks Ended August 1, 1998 Compared to Thirteen Weeks Ended
August 2, 1997
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<PAGE>
Net sales in the second quarter of 1998 increased 5.9% to $74,827,000
from $70,664,000 in the second quarter of 1997. Comparable stores' sales
increased 9.1%, primarily due to an increase in the number of saleschecks
generated. The average unit selling price and the average number of units per
salescheck also increased. During the second quarter, five stores were closed
permanently and one store that was closed temporarily due to tornado damage was
re-opened, reducing the number of stores operated by the Company on August 1,
1998 to 436. At August 2, 1997, the Company operated 455 stores.
Gross margin, after buying and occupancy costs, increased as a
percentage of sales to 34.2% from 31.3% in the second quarter of 1997. The
increase is attributable to an increase in merchandise margin, which increased
as a percentage of sales by 210 basis points. The increase in merchandise margin
was driven primarily by a decrease in merchandise markdowns. Additionally, the
Company leveraged its buying and occupancy costs as a result of increased sales.
Selling, general and administrative expenses increased to $19,314,000
in the second quarter of 1998 compared to $18,716,000 in the second quarter of
1997. The increase is primarily attributable to store and management performance
bonuses, offset by decreased inter-store freight and various other costs. As a
percentage of sales, the selling, general and administrative expenses decreased
to 25.8% from 26.5% in the second quarter of 1997.
The Company reviewed its store base in late fiscal 1997 and committed to a
flexible plan to close approximately 30 underperforming stores upon lease
termination or by settlement with the landlords. Five underperforming stores
were closed during the second quarter of fiscal 1998 at a cost of approximately
$11,000 and six additional stores have scheduled closing dates during the
remainder of fiscal 1998. The remaining stores' leases are still being
negotiated with the landlords.
Interest expense was approximately $154,000 in the second quarter of
1998 compared to $328,000 in the second quarter of 1997. The decrease is
primarily attributable to the decrease in working capital borrowings, offset by
the addition of mortgage interest expense.
Income taxes were provided at effective rates of 41.0% and 41.1% for
the thirteen weeks ended August 1, 1998 and August 2, 1997, respectively. The
statutory rate is affected primarily by non-deductible goodwill amortization and
state income taxes.
Net income for the second quarter of 1998 was $3,459,000 compared to
$1,654,000 for the second quarter of 1997. Diluted net income per common share
("Net income per common share") was $0.47 per share in the second quarter of
1998 and $0.23 per share in the second quarter of 1997.
Twenty-Six Weeks Ended August 1, 1998 Compared to Twenty-Six Weeks Ended
August 2, 1997
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<PAGE>
Net sales in the first half of 1998 increased 6.8% to $151,279,000 from
$141,632,000 in the first half of 1997. Comparable stores' sales increased 9.7%,
primarily due to an increase in the number of saleschecks generated. The average
unit selling price and the average number of units per salescheck also
increased. During the first six months of 1998, seven stores were closed
bringing the number of stores operated by the Company on August 1, 1998 to 436.
At August 2, 1997, the Company operated 455 stores.
Gross margin, after buying and occupancy costs, increased as a
percentage of sales to 33.7% from 31.3% in the first six months of 1997. The
increase is attributable to an increase in merchandise margin, which increased
as a percentage of sales by 110 basis points. The increase in merchandise margin
was driven primarily by a decrease in merchandise markdowns. Additionally, the
Company leveraged its buying and occupancy costs as a result of increased sales.
Selling, general and administrative expenses increased to $39,746,000
in the first six months of 1998 compared to $38,370,000 in the first six months
of 1997. The increase is primarily attributable to store and management
performance bonuses and consultant services incurred to re-engineer the
merchandise assortment and planning and distribution functions. This increase is
partially offset by decreased advertising, inter-store freight, store supplies
and store service expenses. As a percentage of sales, the selling, general and
administrative expenses decreased to 26.3% from 27.1% in the first six months of
1997.
The Company reviewed its store base in late fiscal 1997 and committed to a
flexible plan to close approximately 30 underperforming stores upon lease
termination or by settlement with the landlords. Seven underperforming stores
were closed during the first half of fiscal 1998 at a cost of approximately
$199,000 and six additional stores have scheduled closing dates during the
remainder of fiscal 1998. Rent reductions were negotiated for two of the stores
scheduled for closing. The remaining 15 stores' leases are still being
negotiated with the landlords.
Interest expense was approximately $434,000 in the first six months of
1998 compared to $650,000 in the first six months of 1997. The decrease is
primarily attributable to the decrease in working capital borrowings, offset by
an increase in capital lease expense and the addition of mortgage interest
expense.
Income taxes were provided at an effective rate of 41.0% in the first
six months of 1998 and 1997. The statutory rate is affected primarily by
non-deductible goodwill amortization and state income taxes.
Net income for the first six months of 1998 was $5,930,000 compared to
$2,868,000 for the first six months of 1997. Net income per common share was
$0.80 compared to $0.40 per share reported in the first six months of 1997.
-13-
<PAGE>
Year 2000 Compliance
The Company has developed a plan to ensure its systems are compliant with
the requirements to process transactions in the year 2000. The majority of the
Company's information systems are serviced by outside vendors who are in the
process of completing all necessary updates to ensure they will continue to be
effective in the year 2000. Management does not currently believe it has other
minor technological equipment which, if not year 2000 compliant will have a
material impact on the Company's business operations.
The Company has requested from its key third-party providers certifications
of year 2000 compliance. The Company expects to complete the third-party
compliance certifications by the end of fiscal 1998. Once this assessment is
complete, the Company will begin to identify and assess the remaining risks and
costs of year 2000 scenarios. Contingency plans to address unexpected year 2000
scenarios will be prepared as material risks and uncertainties are identified.
The Company expects the majority of its information systems to be year 2000
compliant by 1999, however, no assurances can be given that the efforts by the
Company, its outside service providers and its third-parties will be successful.
The Company does not currently have an estimate of the cost to remedy non-year
2000 compliant technologies; however, management does not expect that the costs
to achieve year 2000 compliance will be material to its consolidated financial
position or results of operations.
-14-
<PAGE>
PART 2 - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in the Rights of the Company's Security Holders
Not applicable
Item 3. Defaults by the Company on its Senior Securities
Not applicable
Item 4. Submission of Matters to a vote of Security Holder
See Quarterly Report on Form 10-Q for the period ended May 2, 1998
for the results of the Company's Annual Meeting of Stockholders
held on June 3, 1998.
Item 5. Other Information
Not applicable
Item 6. Exhibits and Reports on Form 8-K
(A) 27.1 Financial Data Schedule (for EDGAR filing only)
(B) None
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
SIGNATURES
September 2, 1998 /s/David C. Forell
(Date) -------------------
David C. Forell,
Executive Vice President,Chief
Financial Officer
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<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000875194
<NAME> CATHERINES STORES CORPORATION
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 6-MOS
<FISCAL-YEAR-END> JAN-30-1999 JAN-30-1999
<PERIOD-START> MAY-03-1998 FEB-01-1999
<PERIOD-END> AUG-01-1998 AUG-01-1998
<CASH> 10,190 10,190
<SECURITIES> 0 0
<RECEIVABLES> 2,481 2,481
<ALLOWANCES> 0 0
<INVENTORY> 51,895 51,895
<CURRENT-ASSETS> 70,936 70,936
<PP&E> 69,114 69,114
<DEPRECIATION> (36,306) (36,306)
<TOTAL-ASSETS> 128,993 128,993
<CURRENT-LIABILITIES> 43,188 43,188
<BONDS> 0 0
0 0
0 0
<COMMON> 46,701 46,701
<OTHER-SE> 0 0
<TOTAL-LIABILITY-AND-EQUITY> 128,993 128,993
<SALES> 74,827 151,279
<TOTAL-REVENUES> 74,827 151,279
<CGS> 49,208 100,317
<TOTAL-COSTS> 49,208 100,317
<OTHER-EXPENSES> 19,601 40,475
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 154 434
<INCOME-PRETAX> 5,864 10,053
<INCOME-TAX> 2,405 4,123
<INCOME-CONTINUING> 3,459 5,930
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 3,459 5,930
<EPS-PRIMARY> $0.48 $0.82
<EPS-DILUTED> $0.47 $0.80
</TABLE>
