<PAGE> 1
UNITED STATES
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 October 30, 1999
|_| 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: 000-20132
THE BUCKLE, INC.
(Exact name of Registrant as specified in its charter)
Nebraska 47-0366193
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2407 West 24th Street, Kearney, Nebraska 68845
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (308) 236-8491
-----------------------------------------------------------
(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 such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes |X| No |_|
The number of shares issued of the Registrant's Common Stock, outstanding as of
November 29, 1999 was 21,216,199 shares of Common Stock.
<PAGE> 2
THE BUCKLE, INC.
FORM 10-Q
INDEX
Pages
-----
Part I. Financial Information (unaudited)
Item 1. Financial Statements 3
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
Item 3. Quantitative and Qualitative Disclosures About Market Risk 12
Part II. Other Information
Item 1. Legal Proceedings 13
Item 2. Changes in Securities and Use of Proceeds 13
Item 3. Defaults Upon Senior Securities 13
Item 4. Submission of Matters to a Vote of Security Holders 13
Item 5. Other Information 13
Item 6. Exhibits and Reports on Form 8-K 13
(a) Exhibit 11, statement regarding computation of earnings
per share
(b) No reports on Form 8-K were filed by the Company
during the Quarter ended October 30, 1999
Signatures 14
2
<PAGE> 3
<TABLE>
<CAPTION>
THE BUCKLE, INC.
BALANCE SHEETS
(columnar amounts in thousands)
(unaudited)
ASSETS October 30, January 30,
CURRENT ASSETS: 1999 1999
--------- ---------
<S> <C> <C>
Cash and cash equivalents $ 38,231 $ 61,705
Short-term investments 34,116 26,691
Accounts receivable, net of allowance
of $300,000 4,532 3,980
Inventory 67,558 49,411
Prepaid expenses and other assets 2,324 2,231
--------- ---------
Total current assets 146,761 144,018
PROPERTY AND EQUIPMENT 89,847 74,041
Less accumulated depreciation 36,566 34,798
--------- ---------
53,281 39,243
OTHER ASSETS 1,418 2,852
--------- ---------
$ 201,460 $ 186,113
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 20,458 $ 16,817
Accrued employee compensation 12,532 16,919
Accrued store operating expenses 3,778 3,317
Gift certificates redeemable 1,240 1,593
Income taxes payable 2,498 1,337
--------- ---------
Total current liabilities 40,506 39,983
STOCKHOLDERS' EQUITY:
Common stock, authorized 100,000,000 shares
of $.01 par value; issued and outstanding 21,529,599
and 21,968,921 shares, respectively 215 220
Additional paid-in capital 27,666 37,431
Retained earnings 133,930 109,534
Unearned compensation - restricted stock (857) (1,055)
--------- ---------
Total stockholders' equity 160,954 146,130
--------- ---------
$ 201,460 $ 186,113
========= =========
See notes to financial statements.
</TABLE>
3
<PAGE> 4
THE BUCKLE, INC.
STATEMENTS OF INCOME
(amounts in thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
Thirteen Weeks Ended Thirty-nine Weeks Ended
------------------------- -------------------------
October 30, October 31, October 30, October 31,
1999 1998 1999 1998
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
SALES, net of returns and allowances $107,463 $ 96,818 $266,735 $234,352
COST OF SALES (including buying,
distribution and occupancy costs) 68,905 61,251 174,450 151,778
-------- -------- -------- --------
Gross profit 38,558 35,567 92,285 82,574
OPERATING EXPENSES:
Selling 17,670 16,425 46,814 42,189
General and administrative 2,933 2,688 7,853 7,054
-------- -------- -------- --------
20,603 19,113 54,667 49,243
-------- -------- -------- --------
Income from operations 17,955 16,454 37,618 33,331
OTHER INCOME 588 549 1,476 1,404
-------- -------- -------- --------
Income before income taxes 18,543 17,003 39,094 34,735
Income tax expense 6,991 6,411 14,698 13,091
-------- -------- -------- --------
NET INCOME $ 11,552 $ 10,592 $ 24,396 $ 21,644
======== ======== ======== ========
Basic income per share $0.54 $0.48 $1.11 $0.99
Diluted income per share $0.51 $0.46 $1.06 $0.94
Basic shares outstanding 21,530 21,958 21,884 21,963
Diluted shares outstanding 22,510 22,999 23,078 23,133
See notes to financial statements
</TABLE>
4
<PAGE> 5
THE BUCKLE, INC.
STATEMENTS OF CASH FLOWS
(amounts in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Thirty-nine Weeks Ended
-----------------------
October 30, October 31
1999 1998
----------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Net income $ 24,396 $ 21,644
Adjustments to reconcile net income to net cash
flows from operating activities:
Depreciation 6,733 4,824
Loss on disposal of assets 510 218
Amortization of unearned compensation 198 199
Changes in assets and liabilities:
Accounts receivable (552) (2,036)
Inventory (18,147) (11,605)
Prepaid expenses and other assets (93) (507)
Accounts payable 3,641 3,686
Accrued employee compensation (2,631) 520
Accrued store operating expenses 461 1,046
Gift certificates redeemable (353) (300)
Income taxes payable 1,161 425
-------- --------
Net cash flows from operating activities 15,324 18,114
CASH FLOWS FROM INVESTING ACTIVITIES:
Change in short-term investments (7,425) (9,716)
Purchase of property and equipment (20,133) (13,532)
Decrease in other assets 286 4
-------- --------
Net cash flows from investing activities (27,272) (23,244)
CASH FLOWS FROM FINANCING ACTIVITIES:
Purchases of common stock (12,589) (1,935)
Proceeds from the exercise of stock options 1,063 2,381
-------- --------
Net cash flows from financing activities (11,526) 446
-------- --------
Net decrease in cash and cash equivalents (23,474) (4,684)
Cash and cash equivalents, Beginning of period 61,705 53,593
-------- --------
Cash and cash equivalents, End of period $ 38,231 $ 48,909
======== ========
See notes to financial statements.
</TABLE>
5
<PAGE> 6
THE BUCKLE, INC.
NOTES TO FINANCIAL STATEMENTS
THIRTEEN AND THIRTY-NINE WEEKS ENDED
OCTOBER 30, 1999 AND OCTOBER 31, 1998
(Unaudited)
1. Management Representation - The accompanying unaudited financial statements
have been prepared in accordance with generally accepted accounting
principles for interim financial information. Accordingly, they do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments necessary for a fair presentation of the
results of operations for the interim periods have been included. All such
adjustments are of a normal recurring nature. Because of the seasonal
nature of the business, results for interim periods are not necessarily
indicative of a full year's operations. The accounting policies followed by
the Company and additional footnotes are reflected in the financial
statements for the fiscal year ended January 30, 1999, included in The
Buckle, Inc.'s 1998 Annual Report.
2. Description of the Business - The Company is a retailer of medium to better
priced casual apparel and footwear for fashion conscious young men and
women. The Company operates it's business as one reportable industry
segment. The Company had 247 stores located in 35 states throughout the
central, northwestern and southern areas of the United States as of October
30, 1999, and 217 stores in 29 states as of October 31, 1998. During the
third quarter of fiscal 1999, the Company opened ten new stores and
substantially renovated two stores. During the third quarter of fiscal
1998, the Company opened five new stores and substantially renovated two
stores.
The following is information regarding the Company's major product lines,
stated as a percentage of the Company's net sales:
<TABLE>
<CAPTION>
Percentage of Net Sales Percentage of Net Sales
Thirteen Weeks Ended Thirty-nine Weeks Ended
Merchandise Group Oct. 30, 1999 Oct. 31, 1998 Oct. 30, 1999 Oct. 31, 1998
<S> <C> <C> <C> <C>
Denims 30.3% 32.5% 23.0% 26.5%
Casual bottoms 4.5% 4.7% 4.4% 3.8%
Tops (incl. sweaters) 33.7% 34.6% 33.8% 32.8%
Sportswear/fashions 2.5% 2.1% 10.6% 10.5%
Accessories 6.3% 5.5% 6.1% 5.4%
Footwear 14.9% 15.4% 17.4% 18.3%
Other 7.8% 5.2% 4.7% 2.7%
------ ------ ------ ------
100.0% 100.0% 100.0% 100.0%
====== ====== ====== ======
</TABLE>
3. Net Income Per Share - Basic earnings per share data are based on the
weighted average outstanding common shares during the period. Diluted
earnings per share data are based on the weighted average outstanding
common shares and the effect of all dilutive potential common shares,
including stock options and warrants.
4. Accounting Pronouncements - In June 1998, the FASB issued Statement No.
133, "Accounting for Derivative Instruments and Hedging Activities" which
will be effective for fiscal years beginning after June 15, 2000. The
Company will adopt this Statement effective February 4, 2001. At this time,
the Company believes the impact of adopting this Statement should not be
significant to the results of operations or financial position.
6
<PAGE> 7
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following is management's discussion and analysis of certain significant
factors which have affected the Company's financial condition and results of
operations during the periods included in the accompanying financial statements.
RESULTS OF OPERATIONS
- ---------------------
The table below sets forth the percentage relationships of sales and various
expense categories in the Statements of Income for each of the thirteen and
thirty-nine week periods ended October 30, 1999, and October 31, 1998:
<TABLE>
<CAPTION>
THE BUCKLE, INC.
RESULTS OF OPERATIONS
Percentage of Net Sales Percentage of Net Sales
----------------------- -----------------------
Thirteen weeks ended Percentage Thirty-nine weeks ended Percentage
Oct. 30, Oct. 31, increase Oct. 30, Oct. 31, increase
1999 1998 (decrease) 1999 1998 (decrease)
-----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Sales 100.0% 100.0% 11.0% 100.0% 100.0% 13.8%
Cost of sales (including
buying, distribution and
occupancy costs) 64.1% 63.3% 12.5% 65.4% 64.8% 14.9%
--------------------------------- --------------------------------
Gross profit 35.9% 36.7% 8.4% 34.6% 35.2% 11.8%
Selling expenses 16.5% 17.0% 7.6% 17.6% 18.0% 11.0%
General and
administrative expenses 2.7% 2.7% 9.1% 2.9% 3.0% 11.3%
--------------------------------- --------------------------------
Income from operations 16.7% 17.0% 9.1% 14.1% 14.2% 12.9%
Other income .5% .5% 7.1% .5% .6% 5.1%
--------------------------------- --------------------------------
Income before provision
for income taxes 17.2% 17.5% 9.0% 14.6% 14.8% 12.5%
Provision for income taxes 6.5% 6.6% 9.1% 5.5% 5.6% 12.3%
--------------------------------- --------------------------------
Net Income 10.7% 10.9% 9.1% 9.1% 9.2% 12.7%
================================= ================================
</TABLE>
Net sales increased from $96.8 million in the third quarter of fiscal 1998 to
$107.5 million in the third quarter of fiscal 1999, an 11.0% increase.
Comparable store sales increased from the third quarter of fiscal 1998 to the
third quarter of fiscal 1999 by $1.4 million or 1.5%.
Net sales increased from $234.4 million in the first nine months of fiscal 1998
to $266.7 million for the first nine months of fiscal 1999, a 13.8% increase.
Comparable store sales for the thirty-nine weeks ended October 30, 1999 compared
to the thirty-nine weeks ended October 31, 1998 increased $6.2 million or 2.7%.
Sales growth of 11.1% for this thirty-nine week period was attributable to the
inclusion of a full nine months of operating results for the 24 stores opened in
1998 and the opening of 25 new stores in the first thirty-nine weeks of fiscal
1999. Average sales per square foot decreased .8% from $240 to $238.
7
<PAGE> 8
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Gross profit after buying, occupancy, and distribution expenses increased $3.0
million in the third quarter of fiscal 1999 to $38.6 million, an 8.4% increase.
As a percentage of net sales, gross profit decreased from 36.7% in the third
quarter of fiscal 1998 to 35.9% in the third quarter of fiscal 1999. Gross
profit increased $9.7 million for the first thirty-nine weeks of fiscal 1999 to
$92.3 million, an 11.8% increase. As a percentage of net sales, gross profit in
the first nine months decreased from 35.2% for fiscal 1998, to 34.6% for fiscal
1999. The quarter and year-to-date decreases were attributable to higher
occupancy costs as a percentage of net sales due to the decline in leverage
provided by comparable store sales. For the nine month period ended October 30,
1999, there was also increased cost associated with depreciation expense for the
distribution center recorded during the first five months of fiscal 1999 that
had not been incurred during the first five months of fiscal 1998.
Selling expenses increased from $16.4 million for the third quarter of fiscal
1998 to $17.7 million for the third quarter of fiscal 1999, a 7.6% increase.
Selling expenses as a percentage of net sales decreased from 17.0% for the third
quarter fiscal 1998, to 16.5% for the third quarter of fiscal 1999. Year-to-date
selling expense rose 11.0% from $42.2 million through the first nine months of
fiscal 1998 to $46.8 million for the first nine months of fiscal 1999. As a
percentage of net sales, selling expense for the first nine months decreased
from 18.0% in fiscal 1998, to 17.6% in the fiscal 1999 nine-month period. The
primary reason for the improvement in selling expenses as a percentage of net
sales is leverage provided by the adoption of the Company's 1999 Management
Incentive Program.
General and administrative expenses increased from $2.7 million in the third
quarter of fiscal 1998 to $2.9 million in the third quarter of fiscal 1999, a
9.1% increase. As a percentage of net sales, general and administrative expenses
for the 13 weeks ended October 30, 1999 remained the same at 2.7% for both
fiscal 1998 and fiscal 1999. For the first nine months of fiscal 1999, general
and administrative expense rose 11.3% from $7.1 million for the three quarters
ended October 31, 1998, to $7.9 million for the three quarters ended October 30,
1999. As a percentage of net sales, general and administrative expense decreased
to 2.9% for the first nine months of fiscal 1999 compared to 3.0% for the first
nine months of fiscal 1998. Decreases in general and administrative expenses for
the first nine months, as a percentage of net sales, resulted primarily from
leverage provided by the adoption of the Company's 1999 Management Incentive
Program, partially offset by slight increases in various expense categories.
As a result of the above changes, the Company's income from operations increased
$1.5 million to $18.0 million for the third quarter of fiscal 1999 compared to
$16.5 million for the third quarter of fiscal 1998, a 9.1% increase. Income from
operations was 16.7% of net sales in the third quarter of fiscal 1999 compared
to 17.0% in the third quarter of fiscal 1998. Income from operations,
year-to-date through October 30, 1999, was $37.6 million, up $4.3 million or
12.9% from the prior year first nine months. Income from operations was 14.1% as
a percentage of net sales for the first nine months of fiscal 1999 compared to
14.2% for the first nine months of fiscal 1998.
8
<PAGE> 9
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
For the quarter ended October 30, 1999, other income increased 7.1%. For the
nine months ended October 30, 1999, other income increased 5.1%. The increase
year-to-date is primarily due to additional interest income, as the average
level of cash and short-term investments was greater than in the same period of
fiscal 1998. The increase is partially offset by the loss on disposal of fixed
assets related to write-offs recorded from the rollout of new point of sale
systems and store and corporate office remodels.
Income tax expense as a percentage of pre-tax income was 37.6% in the first nine
months of fiscal 1999 compared to 37.7% in the first nine months of fiscal 1998.
The primary reason for the lower effective income tax rate is the growth in the
amount of federal and/or state tax-exempt interest income.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
The Company's primary ongoing cash requirements are for inventory, payroll, new
store expansion, and remodeling. Historically, the Company's primary source of
working capital has been cash flow from operations. During the first three
quarters of fiscal 1999 and 1998, the Company's cash flow provided by operating
activities was $15.3 million and $18.1 million, respectively.
The uses of cash for both thirty-nine week periods include payment of annual
bonuses accrued at fiscal year end, changes in inventory and accounts payable
for build up of inventory levels, and construction costs for opening new stores.
The primary differences creating greater usage of cash this year versus last
year are a greater build up of inventory, a higher level of capital
expenditures, a higher level of bonuses paid, and a higher level of financing
activity for Company stock repurchases during the first three quarters of fiscal
1999 compared to fiscal 1998.
The Company has available an unsecured line of credit of $5.0 million and a $5.0
million line of credit for foreign and domestic letters of credit, with First
National Bank and Trust Company of Kearney, Nebraska. Borrowings under the
lending arrangements provide for interest to be paid at a rate equal to the
prime rate published in the Wall Street Journal on the date of the borrowings.
As of October 30, 1999, the Company had working capital of $106.3 million,
including $38.2 million of cash and cash equivalents and short-term investments
of $34.1 million. There were minor bank borrowings during the first nine months
of fiscal 1999 and no bank borrowings during the first nine months of fiscal
1998.
During the first three quarters of fiscal 1999 and 1998 the Company invested
$14.3 million and $7.6 million, respectively, in new store construction, store
renovation and upgrading store technology, net of any construction allowances
received from landlords. The Company also spent approximately $2.3 million and
$5.9 million, respectively, in the first three quarters of fiscal 1999 and 1998
in capital expenditures for the corporate headquarters and distribution center.
During fiscal 1998, the Company completed its expansion to the corporate
headquarters and distribution facility. The addition is approximately 124,000
square feet, added to the existing 55,000 square foot building. The majority of
the space is used for the distribution center, with approximately
9
<PAGE> 10
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
7,800 square feet of new office space. The distribution center was completed in
June 1998 and the new office space was completed in December 1998. The former
distribution area was remodeled for use as store supply warehousing and offices,
merchandising and advertising offices as well as new workroom, showroom and
conference room space. The remodel of this phase was completed in March 1999.
The next remodeling phase included remodeling and reorganization of the existing
office space and was completed during the third quarter of fiscal 1999. The
final phase of the remodel project is estimated to be complete during fiscal
1999. The total cost of the expansion plus all phases of the remodel project is
estimated to be $8.8 million, of which approximately $6.5 million was incurred
during fiscal 1998. Also during the second quarter of fiscal 1999, the Company
purchased a second corporate aircraft at a cost of $3.5 million. The Company
believes that existing cash and cash flow from operations will be sufficient to
fund current and long-term anticipated capital expenditures and working capital
requirements for the next several years.
During the remainder of fiscal 1999, the Company anticipates completing
approximately eight additional store construction projects, including two new
stores and approximately six stores to be remodeled and/or relocated. As of
October 30, 1999, thirteen additional lease contracts have been signed, and
additional leases are in various stages of negotiation. Management now estimates
that total capital expenditures during fiscal 1999 will be approximately $22.5
million net of any landlord allowances, estimated to be over $2.0 million.
SEASONALITY AND INFLATION
- -------------------------
The Company's business is seasonal, with the Christmas season (from
approximately November 15 to December 30) and the back-to-school season (from
approximately July 15 to September 1) historically contributing the greatest
volume of net sales. For fiscal years 1996, 1997, and 1998, the Christmas and
back-to-school seasons accounted for an average of approximately 40% of the
Company's fiscal year net sales. Although the operations of the Company are
influenced by general economic conditions, the Company does not believe that
inflation has had a material effect on the results of operations during the
thirty-nine week periods ended October 30, 1999, and October 31, 1998.
YEAR 2000 MATTERS
- ------------------
Year 2000 Background - The Company recognizes that the arrival of the year 2000
poses a unique worldwide technological challenge as all computer information
systems will require the ability to recognize the date change from December 31,
1999 to January 1, 2000 and forward to properly process transactions. Computer
programs and hardware as well as software products that are date sensitive may
recognize a date using "00" as the Year 1900 rather than the Year 2000. This
could result in system failure or miscalculations causing disruptions of
operations, including, among other things, a temporary inability to process
transactions or engage in normal business activities.
The Company's goal is to be Year 2000 compliant, meaning critical systems,
devices, applications or business relationships have been evaluated and are
expected to be suitable for continued use into and beyond the Year 2000, or
contingency plans are in place. The Company has assessed its business computer
systems, such as general ledger, payroll, accounts payable and inventory
control, including distribution center functions. The majority of these systems,
which
10
<PAGE> 11
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
are internally developed computer programs, have been corrected. The stores'
point-of-sale systems are not internally developed but rather operate via
third-party software systems.
During August 1997, the Company entered into an agreement with a third-party
provider to prepare the customized software necessary to bring the stores'
Point-of-Sale system into Year 2000 compliance. This system has been rolled out
to the retail outlets, which was completed in July of 1999.
The Company presently believes that with modifications to its internally
developed programs and with new third-party software, the Year 2000 issue will
not pose significant operational problems for the Company. However, if such
modification and replacements are not made, or not completed on time, the Year
2000 issue could have a material impact on the company.
Year 2000 Costs - Total costs of this project to date have been incurred and
expensed or capitalized in the normal course of operations of the Company. The
total remaining cost of the Year 2000 project is estimated at less than
$100,000. The majority of such cost is for the purchase of new software and
hardware for replacement of all stores' Point-of-Sale systems and has been
capitalized and paid for with cash flow from operations. The hardware and
software replacement would have been done regardless of the Year 2000 issue to
improve the technology in the retail stores. The remaining costs of the project
are based upon the management's best estimates, using currently available
information and making assumptions regarding future events including the
continued availability of certain resources, third-party readiness and other
factors.
Risk Assessment - At this time, the Company believes its most reasonably likely
worst case scenarios are: (1) the stores are unable to authorize bankcard sales
electronically at the Point-of-Sale terminals nor verify checks tendered; and
(2) that principal suppliers are not Year 2000 ready and cannot timely deliver
their products. Although the Company does not believe that this scenario will
occur, it has assessed the effect of such an event and does not expect that it
would have a material adverse effect on the Company's financial condition and
results of operations.
The Company currently operates 249 retail stores in 35 states, has many
suppliers, and believes that this will help mitigate any adverse impact. The
company assessed this risk and believes that its contingency plans would
mitigate the long-term effect of this scenario. In the event that a temporary
disruption does occur, the Company does not expect that it would have a material
adverse effect on its financial condition and results of operations.
Contingency Plans - Contingency plans will be prepared so that the Company's
critical business processes can be expected to continue to function on January
1, 2000 and beyond. The Company's contingency plans will be structured to
address both remediation of systems and their components and overall business
operating risk. These plans are intended to mitigate both internal risks and
potential risks in the supply chain of the Company's suppliers.
11
<PAGE> 12
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FORWARD LOOKING STATEMENTS
- --------------------------
Information in this report, other than historical information, may be considered
to be forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 (the "1995 Act"). Such statements are made in good
faith by the Company pursuant to the safe-harbor provisions of the 1995 Act. In
connection with these safe-harbor provisions, this management's discussion and
analysis contains certain forward-looking statements, which reflect management's
current views and estimates of future economic conditions, company performance
and financial results. The statements are based on many assumptions and factors
that could cause future results to differ materially. Such factors include, but
are not limited to, changes in product mix, changes in fashion trends,
competitive factors and general economic conditions, economic conditions in the
retail apparel industry, year 2000 issues, as well as other risks and
uncertainties inherent in the Company's business and the retail industry in
general. Any changes in these factors could result in significantly different
results for the Company. The Company further cautions that the forward-looking
information contained herein is not exhaustive or exclusive. The Company does
not undertake to update any forward-looking statements, which may be made from
time to time by or on behalf of the Company.
ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company has evaluated the disclosure requirements of Item 305 of S-K
"Quantitative and Qualitative Disclosures about Market Risk," and has concluded
that the Company has no market risk sensitive instruments for which these
additional disclosures are required.
12
<PAGE> 13
THE BUCKLE, INC.
PART II -- OTHER INFORMATION
Item 1. Legal Proceedings: None
Item 2. Changes in Securities: None
Item 3. Defaults Upon Senior Securities: None
Item 4. Submission of Matters to a Vote of Security Holders: None
Item 5. Other Information: None
Item 6. Exhibits and Reports on Form 8-K:
(a) See Exhibit 11, statement regarding computation of earnings per
share.
(b) No reports on Form 8-K were filed by the Company during the
quarter ended October 30, 1999.
13
<PAGE> 14
THE BUCKLE, INC.
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.
THE BUCKLE, INC.
Dated: December 9, 1999 /s/ DENNIS H. NELSON
-----------------------------------
DENNIS H. NELSON, President and CEO
Dated: December 9, 1999 /s/ KAREN B. RHOADS
----------------------------------
KAREN B. RHOADS, Vice President
of Finance and CFO
14
<PAGE> 1
Exhibit 11
----------
THE BUCKLE, INC.
COMPUTATIONS OF EARNINGS PER SHARE
(dollar amounts in thousands, except per share data)
<TABLE>
<CAPTION>
Thirteen Weeks Ended Thirteen Weeks Ended
October 30, 1999 October 31, 1998
----------------------------------- ---------------------------------
Income Shares Per Share Income Shares Per Share
Amount Amount
<S> <C> <C> <C> <C> <C> <C>
Basic EPS
Net Income $11,552 21,530 $ 0.54 $ 10,592 21,958 $ 0.48
Effect of Dilutive Securities
Stock Options 980 1,041
----------------------------------- ---------------------------------
Diluted EPS $11,552 22,510 $ 0.51 $ 10,592 22,999 $ 0.46
----------------------------------- ---------------------------------
<CAPTION>
Thirty-nine Weeks Ended Thirty-nine Weeks Ended
October 30, 1999 October 31, 1998
----------------------------------- ---------------------------------
Income Shares Per Share Income Shares Per Share
Amount Amount
<S> <C> <C> <C> <C> <C> <C>
Basic EPS
Net Income $24,396 21,884 $ 1.11 $ 21,644 21,963 $ 0.99
----------------------------------- ---------------------------------
Effect of Dilutive Securities
Stock Options 1,194 1,170
----------------------------------- ---------------------------------
Diluted EPS $24,396 23,078 $ 1.06 $ 21,644 23,133 $ 0.94
=================================== =================================
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-29-2000
<PERIOD-START> AUG-01-1999
<PERIOD-END> OCT-30-1999
<CASH> 38,231
<SECURITIES> 34,116
<RECEIVABLES> 4,832
<ALLOWANCES> 300
<INVENTORY> 67,558
<CURRENT-ASSETS> 146,761
<PP&E> 89,847
<DEPRECIATION> 36,566
<TOTAL-ASSETS> 201,460
<CURRENT-LIABILITIES> 40,506
<BONDS> 0
0
0
<COMMON> 215
<OTHER-SE> 160,739
<TOTAL-LIABILITY-AND-EQUITY> 201,460
<SALES> 107,463
<TOTAL-REVENUES> 107,463
<CGS> 68,905
<TOTAL-COSTS> 20,603
<OTHER-EXPENSES> (588)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 18,543
<INCOME-TAX> 6,991
<INCOME-CONTINUING> 11,552
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 11,552
<EPS-BASIC> .54
<EPS-DILUTED> .51
</TABLE>
