<PAGE>
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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER 0-20079
BEN FRANKLIN RETAIL STORES, INC.
--------------------------------
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 25-1552155
- ------------------------------------- ----------------------------------
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
500 E. NORTH AVENUE,
CAROL STREAM, ILLINOIS 60188-2168
- ------------------------------------- ----------------------------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, 708-482-6100
INCLUDING AREA CODE ----------------------------------
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, AND (2) HAS BEEN SUBJECT TO SUCH FILING
REQUIREMENTS FOR THE PAST 90 DAYS. YES X NO .
----- -----
NUMBER OF SHARES OF COMMON STOCK OUTSTANDING AS OF JULY 31, 1996: 5,462,750
---------
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<PAGE>
PART I. FINANCIAL INFORMATION
BEN FRANKLIN RETAIL STORES, INC. AND SUBSIDIARIES
CONDENSED STATEMENTS OF CONSOLIDATED OPERATIONS
(IN THOUSANDS EXCEPT FOR PER SHARE AMOUNTS)
(UNAUDITED)
THREE MONTHS ENDED
JUNE 30,
------------------
1996 1995
-------- -------
NET SALES $ 46,473 $89,337
OPERATING COSTS
Cost of Sales, Buying and Occupancy 45,233 80,279
General and Administrative Expenses 8,851 8,920
Depreciation and Amortization 1,856 1,128
-------- -------
Total Operating Expenses 55,940 90,327
-------- -------
OPERATING LOSS (9,467) (990)
INTEREST EXPENSE -- NET 2,098 1,328
OTHER INCOME (EXPENSE) 194 (29)
-------- -------
LOSS BEFORE INCOME TAXES (11,371) (2,347)
Income Tax Benefit -- 806
-------- -------
NET LOSS $(11,371) $(1,541)
-------- -------
-------- -------
EARNINGS PER COMMON AND
COMMON EQUIVALENT SHARES:
Net Loss
- Primary $ (2.08) $ (.28)
- Fully Diluted N/A N/A
Average Number of Common and
Common Equivalent Shares Outstanding
- Primary 5,463 5,582
- Fully Diluted N/A N/A
See Notes to Condensed Consolidated Financial Statements.
- 2 -
<PAGE>
BEN FRANKLIN RETAIL STORES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS OF DOLLARS)
JUNE 30, MARCH 31,
1996 1996
(UNAUDITED) ---------
-----------
ASSETS
CURRENT ASSETS
Cash and Cash Equivalents $ 10,314 $ 6,952
Short Term Investments 532 1,337
Receivables - Net 57,598 63,746
Inventories 45,103 53,309
Current Deferred Tax Asset 2,718 2,718
Prepaid Expenses 4,731 4,872
-------- --------
TOTAL CURRENT ASSETS 120,996 132,934
PROPERTIES AND EQUIPMENT
Gross Property and Equipment 56,053 57,284
Less: Allowance for Depreciation
and Amortization 20,367 19,318
-------- --------
Net Properties and Equipment 35,686 37,966
Intangibles, net of amortization 5,057 5,731
DEFERRED TAX ASSET, NET OF VALUATION
ALLOWANCE 18,771 18,755
OTHER ASSETS 10,033 9,842
-------- --------
TOTAL ASSETS $190,543 $205,228
-------- --------
-------- --------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts Payable $ 45,402 $ 53,098
Other Current Liabilities 14,376 16,232
-------- --------
TOTAL CURRENT LIABILITIES 59,778 69,330
CONVERTIBLE SUBORDINATED NOTES 28,750 28,750
OTHER LONG-TERM DEBT 72,230 65,851
OTHER LONG-TERM LIABILITIES 8,772 8,889
STOCKHOLDERS' EQUITY
Preferred Stock, $.01 Par Value;
1,000,000 authorized; none issued -- --
Common Stock, $.01 Par Value;
15,000,000 shares authorized;
5,462,750 shares issued 55 55
Capital in Excess of Par Value 49,288 49,288
Net Unrealized Holding Loss
on Marketable Securities (125) (101)
Retained Earnings (28,020) (16,649)
Treasury Stocks (185) (185)
-------- --------
Total Stockholders' Equity 21,013 32,408
-------- --------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $190,543 $205,228
-------- --------
-------- --------
See Notes to Condensed Consolidated Financial Statements.
- 3 -
<PAGE>
BEN FRANKLIN RETAIN STORES, INC. AND SUBSIDIARIES
CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS
(IN THOUSANDS OF DOLLARS)
(UNAUDITED)
THREE MONTHS ENDED
JUNE 30,
-------------------
1996 1995
-------- --------
CASH FLOWS FROM OPERATING ACTIVITIES
Net Loss $(11,371) $ (1,541)
Adjustments to Reconcile Net Income
to Net Cash Flows (Used)
Provided by Operating Activities:
Depreciation and Amortization 1,856 1,128
Provision for Doubtful Receivables 147 141
Loss on the Sale of Assets -- 127
Loss on Sale of Investments 73 13
Decrease In Other Liabilities (117) (141)
Provision for Deferred Taxes (16) (825)
Cash Provided (Used)
By Working Capital Items:
Accounts and Notes Receivable 6,001 (7,165)
Inventories 8,206 (8,665)
Prepaid Expenses 141 (6,487)
Accounts Payable (7,696) 12,593
Accrued Liabilities (1,856) (3,191)
Other (348) (41)
-------- --------
Total Adjustments 6,391 (12,513)
-------- --------
Net Cash Flows Used by
Operating Activities (4,980) (14,054)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of Properties and
Equipment (243) (758)
Purchases of Investments -- (716)
Acquisitions -- (2,763)
Proceeds from Sale of Properties
and Equipment 1,474 --
Proceeds from Sale of Investments 732 712
-------- --------
Net Cash Flows (Used) Provided
by Investing Activities 1,963 (3,525)
CASH FLOWS FROM FINANCING ACTIVITIES
Net Borrowings Under
Line of Credit Agreement 1,784 15,100
Long-Term Debt Borrowings
(Repayments) 4,595 (321)
-------- --------
Net Cash Flows Provided
by Financing Activities 6,379 14,779
Net Decrease in Cash and
Cash Equivalents 3,362 (2,800)
CASH AND CASH EQUIVALENTS
Beginning of the Period 6,952 9,108
-------- --------
End of the Period $ 10,314 $ 6,308
-------- --------
-------- --------
SUPPLEMENTAL CASH FLOW INFORMATION
Interest Paid $ 2,416 $ 1,951
-------- --------
-------- --------
Income Taxes Paid $ 10 $ 8
-------- --------
-------- --------
See Notes to Condensed Consolidated Financial Statements.
- 4 -
<PAGE>
BEN FRANKLIN RETAIL STORES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1996
(IN THOUSANDS OF DOLLARS)
(UNAUDITED)
NOTE 1 - BASIS OF PRESENTATION
The accompanying condensed consolidated financial statements of Ben Franklin
Retail Stores, Inc. and subsidiaries (the "Company") are unaudited. In the
opinion of management, these statements have been prepared on the same basis
as the audited consolidated financial statements and include all adjustments,
which are of a normal and recurring nature, necessary for the fair
presentation of financial position, results of operations and cash flows. The
results of operations for the three months ended June 30, 1996 are not
necessarily indicative of the results which may be expected for the entire
year. Additional information is contained in the Annual Report on Form 10-K
of the Company filed with the Securities and Exchange Commission for the year
ended March 31, 1996 and it should be read in conjunction with this quarterly
report.
On July 26, 1996, Ben Franklin Retail Stores, Inc. and certain of its
subsidiaries: Ben Franklin Stores, Inc.; Ben Franklin Crafts, Inc.; Ben
Franklin Realty Corp.; Ben Franklin Realty Corp. (II); and Ben Franklin
Transportation, Inc. filed petitions for reorganization under Chapter 11
("Chapter 11") of the United States Bankruptcy Code. The Company is presently
operating its business as a debtor-in-possession subject to the jurisdiction
of the United States Bankruptcy Court for the Northern District of Illinois
(the "Bankruptcy Court"). The financial statements do not include any
adjustments that might be necessary to reflect the possible future effects on
the recoverability and classification of assets or the amounts and
classification of liabilities as a consequence of the bankruptcy proceedings
and related uncertainties.
The following subsidiaries of Ben Franklin Retail Stores, Inc. did not file
under Chapter 11 and continue to operate outside of the jurisdiction of the
Bankruptcy Court: Ben Franklin Insurance Agency, Inc.; Belmont Insurance Co.
Ltd.; and Auto Artistry, Inc.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
PRINCIPLES OF CONSOLIDATION:
The consolidated financial statements include the accounts of the Company and
its wholly-owned subsidiaries: Ben Franklin Stores, Inc. ("Ben Franklin");
Ben Franklin Crafts, Inc.; Ben Franklin Insurance Agency, Inc. ("BFIA"); Ben
Franklin Realty Corp,; Ben Franklin Realty Corp. (II); Belmont Insurance Co.,
Ltd. ("Belmont"); Ben Franklin Transportation, Inc.; and Auto Artistry, Inc.
All significant intercompany balances and transactions have been eliminated
in consolidation.
-5-
<PAGE>
INVENTORIES:
Merchandise inventories are stated at the lower of cost or market, using the
last-in, first-out ("LIFO") method. The excess of first-in, first-out
("FIFO") over LIFO value of inventory at June 30, 1996 and March 31, 1996 was
$70.
INVESTMENTS:
The Company's investments in marketable equity securities are classified as
available for sale and are included in the consolidated balance sheet as
"Short term investments" at their fair value of $532 and $1,337 at June 30,
1996 and March 31, 1996, respectively. The fair value is estimated based on
quoted market prices.
NOTE 3 - LONG-TERM OBLIGATIONS
On May 3, 1996, the Company entered into a new revolving credit facility with
a life insurance company and a commercial lender to replace its line of credit
with LaSalle National Bank. The new facility expires on May 2, 1999 and
provides for borrowings of up to $100,000 based upon advance ratios on
eligible accounts receivable and inventories. The facility is secured by
retail and wholesale inventories, receivables, and other assets (excluding
real estate). The facility bears interest at the prime rate plus 1%,
prohibits the payment of dividends, makes the Company subject to certain
covenants and requires the Company to maintain certain financial ratios.
On June 30, 1996 there was $58,039 in outstanding borrowings under the new
revolving credit facility. In addition, the Company had import letters of
credit issued and outstanding of $921 at June 30, 1996. On June 30, 1996 the
Company was not in compliance with certain financial covenants contained in
its loan agreement. On July 11, 1996, the Company received a waiver of these
first quarter financial covenants, and the interest rate was changed to prime
plus 2%. Due to the Company's financial difficulties, the Company
subsequently went into default under the new revolving credit facility. The
exercise of any remedies available to the lenders stemming from such default
is stayed as a result of the Bankruptcy proceedings. Further, as a result of
such default, additional borrowings under the facility are not permitted and
the Company is currently limited in its borrowings to sums available under
the temporary debtor-in-possession financing arrangements described in Note 8
below.
At June 30, 1996 the Company maintained letter of credit facilities in the
aggregate amount of $400 with various institutions maturing at various dates
through May, 1997. The Company maintains cash and investment balances in
excess of 120% of the amount of such letter of credit.
NOTE 4 - INCOME TAXES
The Company generated losses for financial reporting purposes during the
three months ended June 30, 1996 and 1995. The income tax benefit for
-6-
<PAGE>
the three months ended June 30, 1995 of $806 is included in the balance sheet
as a deferred tax asset. The income tax benefit for the three months ended
June 30, 1996 of $3,124 has been reduced by a valuation allowance of $3,124
relating to net operating loss carryforwards that may not be realized.
NOTE 5 - RESTRUCTURING CHARGE
During the quarter ended December 31, 1995, the Company recorded a pre-tax
restructuring charge of $11,213, related primarily to the re-engineering and
consolidation of its wholesale operations and the closing of up to 8 of its
Company-owned Craft superstores which had annual sales volumes of
approximately $11,100. The cost associated with this re-engineering and
consolidation and the store closings were primarily related to workforce
reductions, inventory markdowns, certain asset writedowns, and future lease
obligations. As of June 30, 1996 the remaining accrued restructuring charges
of $3,921 related to future lease obligations, inventory markdowns and
workforce reductions and are included in other current liabilities and as a
reduction of inventories.
During the quarter ended December 31, 1993, the Company recorded a pre-tax
restructuring charge of $5,254 related to the re-engineering of its wholesale
operations, including costs associated with workforce and inventory
reductions and certain facility relocation expenses. As of June 30, 1996 the
remaining accrued restructuring charge of $1,244 related primarily to
commitments remaining under lease obligations and certain facility relocation
expenses and are included in other current liabilities.
NOTE 6 - DISCLOSURE ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS
The carrying amounts of cash and cash equivalents, short-term investments,
accounts receivable, long-term note receivables, accounts payable and
long-term debt (including short-term portion) are reasonable estimates of
their fair value.
The fair value estimates presented are based on pertinent information
available to management as of June 30, 1996. As previously discussed, the
Company filed a petition for reorganization under Chapter 11 of the United
States Bankruptcy Code on July 26, 1996. In Chapter 11 cases, substantially
all liabilities as of the date of filing the petition for reorganization are
subject to settlement under a plan of reorganization to be voted upon by the
Company's creditors and stockholders and confirmed by the Bankruptcy Court.
These financial statements do not include any adjustments that might be
necessary to reflect the possible future effects on the recoverability and
classification of assets or the amounts and classification of liabilities as
a consequence of the bankruptcy proceedings and related uncertainties. (See
Note 9)
-7-
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The estimated fair value of other financial instruments at June 30, 1996 are
listed in the following table (in thousands of dollars):
<TABLE>
<CAPTION>
Carrying Fair
Amount Market Value
-------- ------------
<S> <C> <C>
Financial Liability:
Convertible subordinated notes $28,750 $13,944
</TABLE>
The fair market value of Convertible Subordinated Notes is based on their
quoted market price at June 30, 1996.
NOTE 7 - LEGAL PROCEEDINGS
On July 26, 1996, the Company and certain of its subsidiaries, Ben Franklin
Crafts, Inc., Ben Franklin Stores, Inc., Ben Franklin Realty Corp., Ben
Franklin Realty Corp. (II), and Ben Franklin Transportation, Inc., filed for
protection from their creditors under Chapter 11 of the United States
Bankruptcy Code in the case captioned, IN RE: BEN FRANKLIN RETAIL STORES,
INC., ET. AL., (United States Bankruptcy Court, Northern District of
Illinois, Eastern Division); Case No. 96 B 19482. The court assumed
jurisdiction over the Company and such subsidiaries on such date, leaving the
existing directors and officers in possession subject to the court's
supervision and orders. The bankruptcy cases of the Company and its
applicable subsidiaries are jointly administered under the foregoing caption
and case number. The Company's other subsidiaries, Ben Franklin Insurance
Agency, Inc., Belmont Insurance Co. Ltd., and Auto Artistry, Inc. continue to
operate outside of the jurisdiction of the Bankruptcy Court.
In addition, the Company is subject to legal proceedings which arise in the
ordinary course of its business, including proceedings involving certain of
its franchise agreements and leases, and has recently been named as a
defendant in a number of lawsuits filed by vendors and service providers
which allege non-payment of amounts due, none of which proceedings or
lawsuits is believed by the Company to be material. All such proceedings are
stayed in accordance with the bankruptcy proceedings disclosed above.
NOTE 8 - SUBSEQUENT EVENTS
As discussed in Note 1 and Note 7, the Company filed a petition for
reorganization under Chapter 11 of the United States Bankruptcy Code on July
26, 1996. The Debtors are authorized to continue to operate the business as
debtors-in-possession and are subject to the jurisdiction of the Bankruptcy
Court. On July 29, 1996 the Company entered into an agreement with its current
revolving line of credit lenders to provide temporary debtor-in-possession
financing while the Company continues to attempt to secure more permanent
debtor-in-possession financing. The temporary financing allows for up to
$2,000 in borrowings and is collateralized by substantially the same assets
as those under its existing revolving line of credit and a second security
interest on certain real estate assets. The temporary financing expires on
August 25, 1996.
-8-
<PAGE>
The Company announced that it will close its distribution center located in
Ontario, California. The consolidation of inventory into the Company's
Seymour, Indiana facility will help to reduce overhead expenses and improve
inventory turnover and liquidity. The closing is expected to be completed by
September 1996.
On July 29, 1996 the Company received approval from the Bankruptcy Court to
pay or otherwise honor certain of its pre-petition obligations relating to
employee wages and reimbursable business expenses.
Consistent with the Company's strategy to concentrate its available resources
on its core wholesaling business, the Company has decided to sell or close
all 33 Company-owned and operated Ben Franklin Crafts Superstores. The sale
or closing of the stores is subject to approval of the Bankruptcy Court. As
the decision to close or sell the stores was made subsequent to June 30,
1996, no amounts have been accrued to provide for equipment removal,
inventory shrinkage, rent and inventory markdowns anticipated to be incurred
related to the store closings.
NOTE 9 - ACCOUNTS RECEIVABLE
As discussed in Note 6, accounts receivable have been valued in the balance
sheet based on pertinent information available to management as of June 30,
1996 and the Company's allowance for bad debts has not been adjusted to
reflect the possible effects on recoverability as a consequence of the
bankruptcy proceedings and related uncertainties. Management believes that
recoverability of its trade receivables could be impaired as a result of the
following factors:
- - As a result of the filing, the Company will no longer ship product and
extend trade credit to any customers whose accounts are past due. This
change in policy may negatively impact such customers' operating
performance and ability to meet their obligations to the Company.
- - The Company's service level to its customers as measured by its ability to
ship is currently running at approximately 25%, which is far below the
Company's historical service level of 90%. Many of the Company's customers
rely on the Company as heir largest product supplier and provider of trade
credit. If the Company's customers cannot find an alternative supplier or
suppliers and sufficient trade credit to meet their working capital needs,
the Company's customers' operating performance and ability to meet their
obligations to the Company could be adversely impacted.
- - Overall, as a result of the Company's present financial situation, the
cost to collect and time to collect trade receivables and obligations
will increase. As a result, the Company may experience reduced
realization rates on the final settlement of its accounts receivable.
-9-
<PAGE>
In future operating periods, the Company expects to substantially
increase its provision for doubtful accounts as specific circumstances
relating to the collectibility and recoverability of accounts receivable
with certain customers become known.
-10-
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
GENERAL
The Company franchises retail variety and craft stores under the names Ben
Franklin and Ben Franklin Crafts and sells variety and crafts merchandise to
its franchises and selected independent retail outlets on a wholesale basis.
As of June 30, 1996, there were 304 franchisee-owned craft stores, including
110 craft superstores, 517 franchisee-owned variety stores and more than 700
independent retail outlets serviced by the Company throughout the United
States and internationally. In addition, the Company owned and operated 33
Ben Franklin Crafts Superstores. On July 26, 1996 the Company and certain of
its subsidiaries: Ben Franklin Stores, Inc.; Ben Franklin Crafts, Inc.; Ben
Franklin Realty Corp.; Ben Franklin Realty Corp. II; and Ben Franklin
Transportation, Inc. filed for reorganization under Chapter 11 of the United
States Bankruptcy Code (the "Reorganization Proceedings") in the Bankruptcy
Court. The Company is currently operating its business as a
debtor-in-possession in the Reorganization Proceedings. No plan of
reorganization has been proposed in the Reorganization Proceedings, and the
Company has the exclusive right to propose such a plan until November 26,
1996, unless such period is extended by order of the Bankruptcy Court. The
Company is headquartered in Carol Stream, Illinois.
RESULTS OF OPERATIONS
THREE MONTHS ENDED JUNE 30, 1996 COMPARED TO THREE MONTHS ENDED
JUNE 30, 1995.
Net sales for the first quarter of fiscal 1997 decreased by 48.0% to $46.5
million as compared with $89.3 million in the same period of the prior year.
As discussed in the Company's previously filed Form 10-K for the year ended
March 31, 1996, the Company's shortage of liquidity has resulted in lower
service levels in the Company's wholesale business to franchisees and
independent retailers.
Cost of sales, buying, and occupancy expenses decreased by 43.7% to $45.2
million as compared with $80.3 million in the same period of the prior year.
As a percent of sales however, these expenses have increased from 89.9% in
the prior year to 97.3% in the current year. This increase primarily reflects
fixed buying and occupancy expenses on lower sales volumes.
General and administrative expenses as a percent of sales have increased from
10.0% in the prior year to 19.0% in the current year. This increase primarily
reflects fixed overhead expenses on lower sales volumes.
Net interest expense increased $.8 million during the three months ended June
30, 1996 from the same period in the prior year due to increased borrowing on
the Company's revolving credit facility.
Net loss for the first quarter of fiscal 1997 increased to $11.4 million
compared to a net loss of $1.5 million in the same period of the prior year.
This increase reflects lower sales volumes during the first quarter of fiscal
1997 as discussed above.
- 11 -
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
On July 26, 1996, the Company filed a petition for reorganization under
Chapter 11 of the United States Bankruptcy Code. The Debtors are authorized
to continue to operate the business as debtors-in-possession and are subject
to the jurisdiction of the Bankruptcy Court. On July 29, 1996 the Company
entered into an agreement with its current revolving line of credit lenders
to provide temporary debtor-in-possession financing while the Company
continues to attempt to secure more permanent debtor-in-possession financing.
The temporary financing allows for up to $2.0 million in additional borrowings
and is collateralized by substantially the same assets as those under its
existing revolving line of credit and a second security interest on certain
real estate assets. The temporary financing expires on August 25, 1996.
The Company is currently negotiating with its existing lenders to obtain a
consensual arrangement, pursuant to which such lenders would provide the
Company with additional debtor-in-possession financing or would consent to
the Company's use of their cash collateral, as defined in the U.S. Bankruptcy
Code, to fund the Company's ongoing operations. If such negotiations are
unsuccessful, the Company intends to seek the Bankruptcy Court's approval to
use such cash collateral over the objections of such lenders. There can be no
assurance that any of these efforts will be successful, or if successful,
that any such financing or cash collateral will be sufficient to fund the
Company's ongoing operations, even with a narrowed focus on the Company's
wholesaling business, or will be on terms that will enable the Company to do
so.
Net working capital decreased $2.4 million from March 31, 1996 to June 30,
1996. Capital expenditures were $.2 million for the quarter ended June 30,
1996.
- 12 -
<PAGE>
PART II - OTHER INFORMATION
Item 6 - EXHIBITS AND REPORTS ON FORM 8-K
a) EXHIBITS
* Exhibit 11 - Computation of Earnings Per Common Share
* Exhibit 27 - Financial Data Schedule
b) REPORTS ON FORM 8-K
The registrant did not file any reports on Form 8-K during the three
months ended June 30, 1996.
On August 9, 1996, the Company filed Form 8-K announcing the Bankruptcy
petition filed on July 26, 1996.
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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.
BEN FRANKLIN RETAIL STORES, INC.
By /s/ DAVID A. BRAINARD
--------------------------------
David A. Brainard
Senior Vice President
Chief Financial Officer
By /s/ DAVID J. LAROCHE
--------------------------------
David J. Laroche
Vice President, Controller
and Chief Accounting Officer
Date: August 14, 1996
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EXHIBIT 11
BEN FRANKLIN RETAIL STORES, INC. AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER COMMON SHARE
(In Thousands, Except Per Share Amounts)
THREE MONTHS ENDED
JUNE 30,
------------------
1996 1995
-------- --------
PRIMARY
Net Loss $(11,371) $(1,541)
-------- -------
-------- -------
Shares
Weighted average number of common and
common equivalent shares outstanding 5,463 5,582
-------- -------
-------- -------
Primary earnings per share:
Net Loss $ (2.08) $ (.28)
-------- -------
-------- -------
Assuming Full Dilution
Earnings
Net Loss $ N/A $ N/A
-------- -------
-------- -------
Shares
Weighted average number of common and
common equivalent shares outstanding N/A N/A
-------- -------
-------- -------
Additional dilutive effect of
convertible notes if fully converted N/A N/A
-------- -------
Weighted average number of common and
common equivalent shares as adjusted N/A N/A
-------- -------
-------- -------
Net Loss $ N/A $ N/A
-------- -------
-------- -------
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-START> APR-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 10,314
<SECURITIES> 532
<RECEIVABLES> 57,598
<ALLOWANCES> 0
<INVENTORY> 45,103
<CURRENT-ASSETS> 120,996
<PP&E> 56,053
<DEPRECIATION> 20,367
<TOTAL-ASSETS> 190,543
<CURRENT-LIABILITIES> 59,778
<BONDS> 28,750
0
0
<COMMON> 55
<OTHER-SE> 20,958
<TOTAL-LIABILITY-AND-EQUITY> 190,543
<SALES> 46,473
<TOTAL-REVENUES> 46,473
<CGS> 45,233
<TOTAL-COSTS> 45,233
<OTHER-EXPENSES> 10,707
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,098
<INCOME-PRETAX> (11,371)
<INCOME-TAX> 0
<INCOME-CONTINUING> (11,371)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (11,371)
<EPS-PRIMARY> (2.08)
<EPS-DILUTED> 0
</TABLE>
