<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 JULY 29, 2000
|_| 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 68845-4915
(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
September 1, 2000 was 20,527,070 shares of Common Stock.
<PAGE> 2
THE BUCKLE, INC.
FORM 10-Q
INDEX
<TABLE>
<CAPTION>
Pages
-----
<S> <C> <C>
Part I. Financial Information (unaudited)
Item 1. Financial Statements 3
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
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 July 29, 2000
Signatures 14
</TABLE>
2
<PAGE> 3
THE BUCKLE, INC.
BALANCE SHEETS
(Columnar amounts in thousands)
(Unaudited)
<TABLE>
<CAPTION>
July 29, January 29,
ASSETS 2000 2000
------ ---------------- ---------------
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 25,747 $ 37,205
Short-term investments:
Held-to-maturity 32,387 40,357
Available-for-sale 4,533 4,002
Accounts receivable, net of
allowance of $175,000 and $225,000, respectively 2,316 3,430
Inventory 73,993 55,045
Prepaid expenses and other assets 4,173 2,387
---------------- ---------------
Total current assets 143,149 142,426
PROPERTY AND EQUIPMENT 99,351 91,735
Less accumulated depreciation 42,589 38,168
---------------- ---------------
56,762 53,567
OTHER ASSETS 2,744 2,553
---------------- ---------------
$ 202,655 $ 198,546
================ ===============
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES
Accounts payable $ 20,998 $ 15,773
Accrued employee compensation 6,379 12,587
Accrued store operating expenses 3,197 3,491
Gift certificates redeemable 1,427 1,925
Income taxes payable 1,183 1,068
---------------- ---------------
Total current liabilities 33,184 34,844
DEFERRED COMPENSATION 829 442
---------------- ---------------
Total liabilities 34,013 35,286
STOCKHOLDERS' EQUITY
Common stock, authorized 100,000,000 shares
of $.01 par value; issued 20,535,720 and
20,726,149 shares, respectively 205 207
Additional paid-in capital 13,990 17,131
Retained earnings 155,286 146,920
Unearned compensation -- restricted stock (659) (791)
Accumulated other comprehensive income (loss) (180) (207)
---------------- ---------------
Total stockholders' equity 168,642 163,260
---------------- ---------------
$ 202,655 $ 198,546
================ ===============
</TABLE>
See notes to financial statements.
3
<PAGE> 4
THE BUCKLE, INC.
STATEMENTS OF INCOME
(Amounts in thousands,
except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Thirteen Weeks Ended Twenty-six Weeks Ended
------------------------------------- ---------------------------------------
July 29, July 31, July 29, July 31,
2000 1999 2000 1999
------------------ ----------------- ------------------ -------------------
<S> <C> <C> <C> <C>
SALES, net of returns and allowances $ 77,111 $ 79,584 $ 155,612 $ 159,272
COST OF SALES (including buying,
distribution and occupancy costs) 54,994 52,958 109,564 105,545
------------------ ----------------- ------------------ -------------------
Gross profit 22,117 26,626 46,048 53,727
OPERATING EXPENSES:
Selling 14,401 14,331 28,867 29,144
General and administrative 2,335 2,425 4,649 4,920
-------------------------------------------------------------------------------
16,736 16,756 33,516 34,064
------------------ ----------------- ------------------ -------------------
Income from operations 5,381 9,870 12,532 19,663
OTHER INCOME 658 314 1,318 888
------------------ ----------------- ------------------ -------------------
Income before income taxes 6,039 10,184 13,850 20,551
Income tax expense 2,269 3,809 5,214 7,707
-------------------------------------------------------------------------------
Income before cumulative effect of
change in accounting 3,770 6,375 8,636 12,844
Cumulative effect of change in
accounting, net of taxes -- -- (270) --
------------------ ----------------- ------------------ -------------------
NET INCOME $ 3,770 $ 6,375 $ 8,366 $ 12,844
================== ================= ================== ===================
Per share amounts:
Basic income per share:
Income before cumulative effect of
change in accounting $0.18 $0.29 $0.42 $0.58
Cumulative effect of change in
accounting, net of taxes -- -- (.01) --
------------------ ----------------- ------------------ -------------------
Net income $0.18 $0.29 $0.41 $0.58
Diluted income per share:
Income before cumulative effect of
change in accounting $0.18 $0.27 $0.40 $0.55
Cumulative effect of change in
accounting, net of taxes -- -- (.01) --
------------------ ----------------- ------------------ -------------------
Net income $0.18 $0.27 $0.39 $0.55
</TABLE>
See notes to financial statements.
4
<PAGE> 5
THE BUCKLE, INC.
STATEMENTS OF CASH FLOWS
(Amounts in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Twenty-six Weeks Ended
-----------------------------------------
July 29, 2000 July 31, 1999
------------------- ------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 8,366 $ 12,844
Adjustments to reconcile net income to net cash
flows from operating activities
Depreciation 5,444 4,220
Loss on disposal of assets 179 395
Amortization of unearned compensation-restricted stock 132 132
Cumulative effect of change in accounting method 270
--
Changes in operating assets and liabilities
Accounts receivable (486) (245)
Inventory (17,908) (19,353)
Prepaid expenses and other assets (1,096) (301)
Accounts payable 4,825 6,583
Accrued employee compensation (6,208) (7,519)
Accrued store operating expenses (294) 113
Gift certificates redeemable (498) (349)
Income taxes payable 115 853
Deferred compensation 387
--
------------------- ------------------
Net cash flows from operating activities (6,772) (2,627)
CASH FLOWS FROM INVESTING ACTIVITIES
Change in short-term investments 7,466 (1,585)
Purchase of property and equipment (8,818) (16,026)
Change in other assets (191)
1,432
------------------- ------------------
Net cash flows from investing activities (1,543) (16,179)
CASH FLOWS FROM FINANCING ACTIVITIES
Purchases of common stock (3,781)
(641)
Proceeds from the exercise of stock options 638 502
------------------- ------------------
Net cash flows from financing activities (3,143) (139)
------------------- ------------------
Net decrease in cash and cash equivalents (11,458) (18,945)
Cash and cash equivalents, Beginning of period 37,205 61,705
------------------- ------------------
Cash and cash equivalents, End of period $ 25,747 $ 42,760
=================== ==================
</TABLE>
See notes to financial statements.
5
<PAGE> 6
THE BUCKLE, INC.
NOTES TO FINANCIAL STATEMENTS
THIRTEEN AND TWENTY-SIX WEEKS
ENDED JULY 29, 2000 AND JULY 31, 1999
(Unaudited)
1. Management Representation -- The accompanying unaudited financial
statements have been prepared in accordance with auditing standards
generally accepted in the United States of America for interim
financial information. Accordingly, they do not include all of the
information and footnotes required by auditing standards generally
accepted in the United States of America 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 29, 2000, included in The Buckle, Inc.'s 1999
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 their business as one reportable
industry segment. The Company had 269 stores located in 36 states
throughout the central, northwestern and southern areas of the United
States as of July 29, 2000, and 237 stores in 32 states as of July 31,
1999. During the second quarter of fiscal 2000, the Company opened
eight new stores and substantially renovated four stores. During the
second quarter of fiscal 1999, the Company opened six new stores and
substantially renovated three 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 Twenty-six Weeks Ended
---------------------------- ----------------------------
Merchandise Group July 29, 2000 July 31, 1999 July 29, 2000 July 31, 1999
----------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Denims 19.7% 16.0% 22.3% 18.1%
Slacks/Casual bottoms 4.0% 4.2% 4.1% 4.3%
Tops (incl. sweaters) 33.4% 35.9% 32.6% 33.9%
Sportswear/Fashions 14.4% 17.7% 13.4% 16.2%
Outerwear 1.0% .6% 1.0% .7%
Accessories 8.0% 6.7% 7.3% 6.0%
Footwear 17.2% 17.3% 16.9% 19.0%
Little Guys/Gals 2.1% 1.7% 2.2% 1.7%
Other .2% .1% .2% .1%
------ ------ ------ ------
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. During the quarter ended July 29,
2000, the Company repurchased and retired 158,200 shares of its common
stock pursuant to authorized buy-back programs.
6
<PAGE> 7
THE BUCKLE, INC.
NOTES TO FINANCIAL STATEMENTS
THIRTEEN WEEKS ENDED APRIL 29, 2000 AND MAY 1, 1999
(Unaudited)
4. Accounting Pronouncements -- In June 1998, the FASB issued Statement
No. 133, "Accounting for Derivative Instruments and Hedging Activities"
which would have been effective January 30, 2000. In June 1999, the
FASB issued SFAS No. 137, "Accounting for Derivative Instruments and
Hedging Activities-Deferral of the Effective Date of FASB Statement No.
133, postponing the effective date for implementing SFAS No. 133 to
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.
5. Change in Accounting -- On January 30, 2000, the Company changed its
revenue recognition policy related to layaway sales in accordance with
the guidance and interpretations provided by the SEC's Staff Accounting
Bulletin (SAB) No. 101 - Revenue Recognition. This SAB affected the
Company's recognition of layaway sales, which requires recognition of
revenue from sales made under its layaway program upon delivery of the
merchandise to the customer. In the first quarter of fiscal 2000, the
Company recorded a $0.3 million cumulative effect adjustment for the
change in this accounting principle in accordance with APB Opinion No.
20, Accounting Changes. If SAB No. 101 had been adopted prior to fiscal
2000, the net income for the first six months of fiscal 1999 would have
been $12.5 million versus the $12.8 million as reported.
6. Comprehensive Income -- Unrealized gains and losses on the Company's
available-for-sale securities are included in other comprehensive
income, net of related taxes.
<TABLE>
<CAPTION>
Thirteen Weeks Ended Twenty-six Weeks Ended
------------------------------------- ---------------------------------------
July 29, July 31, July 29, July 31,
2000 1999 2000 1999
------------------ ----------------- ------------------ -------------------
<S> <C> <C> <C> <C>
Net Income $ 3,770 $ 6,375 $ 8,366 $ 12,844
Unrealized gain on available for sale
securities, net of taxes -- -- 27 --
------------------ ----------------- ------------------ -------------------
Total Comprehensive Income $ 3,770 $ 6,375 $ 8,393 $ 12,844
================== ================= ================== ===================
</TABLE>
7
<PAGE> 8
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
twenty-six week periods ended July 29, 2000, and July 31, 1999:
THE BUCKLE, INC.
RESULTS OF OPERATIONS
<TABLE>
<CAPTION>
Percentage of Net Sales Percentage of Net Sales
------------------------- --------------------------
Thirteen weeks ended Twenty-six weeks ended
-------------------------- Percentage -------------------------- Percentage
July 29, July 31, increase July 29, July 31, increase
2000 1999 (decrease) 2000 1999 (decrease)
------------ ------------- ------------- ------------ ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Net sales 100.0% 100.0% (3.1)% 100.0% 100.0% (2.3)%
Cost of sales (including
buying, distribution and
occupancy costs) 71.3% 66.5% 3.8% 70.4% 66.3% 3.8%
------------ ------------- ------------- ------------ ------------- -------------
Gross profit 28.7% 33.5% (16.9)% 29.6% 33.7% (14.3)%
Selling expenses 18.7% 18.0% .5% 18.6% 18.3% (1.0)%
General and
administrative expenses 3.0% 3.1% (3.7)% 3.0% 3.1% (5.5)%
------------ ------------- ------------- ------------ ------------- -------------
Income from operations 7.0% 12.4% (45.5)% 8.1% 12.3% (36.3)%
Other income .8% .4% 109.6% .8% .6% 48.4%
------------ ------------- ------------- ------------ ------------- -------------
Income before income
taxes 7.8% 12.8% (40.7)% 8.9% 12.9% (32.6)%
Income tax expense 2.9% 4.8% (40.4)% 3.4% 4.8% (32.4)%
------------ ------------- ------------- ------------ ------------- -------------
Income before cumulative effect
of change in accounting
4.9% 8.0% (40.9)% 5.5% 8.1% (32.8)%
============ ============= ============= ============ ============= =============
</TABLE>
Net sales decreased from $79.6 million in the second quarter of fiscal 1999 to
$77.1 million in the second quarter of fiscal 2000, a 3.1% decrease. Comparable
store sales decreased from the second quarter of fiscal 1999 to the second
quarter of fiscal 2000 by $8.6 million or 11.1%. The comparable store sales
decrease resulted partially from a 4.7% decrease in the average price per piece
of merchandise sold compared with the fiscal 1999 second quarter. Comparable
store sales for the second quarter decreased 0.3% due to the change in the
method of revenue recognition for layaways sales in accordance with the guidance
and interpretations provided by the SEC's SAB No. 101-Revenue Recognition.
8
<PAGE> 9
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Net sales decreased from $159.3 million in the first six months of fiscal 1999
to $155.6 million for the first six months of fiscal 2000, a 2.3% decrease.
Comparable store sales for the twenty-six weeks ended July 29, 2000 compared to
the twenty-six weeks ended July 31, 1999 decreased $15.8 million or 10.3%. The
comparable store sales decrease for the first six months of fiscal 2000 resulted
partially from a 6.2% decrease in the average price per piece of merchandise
sold compared with the same period last year. The change in the method of
revenue recognition for layaways sales in accordance with the guidance and
interpretations provided by the SEC's SAB No. 101-Revenue Recognition had no
impact on comparable stores sales for the first six months of fiscal 2000
compared fiscal 1999. Sales growth of 8.0% for this twenty-six week period was
attributable to the inclusion of a full six months of operating results for the
15 stores opened in 1999 and the opening of 20 new stores in the first
twenty-six weeks of fiscal 2000. Average sales per square foot decreased 13.8%
from $144.30 to $124.40 for the six months ended July 29, 2000.
Gross profit after buying, occupancy, and distribution expenses decreased $4.5
million in the second quarter of fiscal 2000 to $22.1 million, a 16.9% decrease.
As a percentage of net sales, gross profit decreased from 33.5% in the second
quarter of fiscal 1999 to 28.7% in the second quarter of fiscal 2000. Gross
profit decreased $7.7 million for the first twenty-six weeks of fiscal 2000 to
$46.0 million, a 14.3% decrease. As a percentage of net sales, gross profit in
the first six months decreased from 33.7% for fiscal 1999, to 29.6% for fiscal
2000. The decrease in gross profit as a percentage of net sales for both the
three and six month periods of fiscal 2000 compared to the same periods of
fiscal 1999 was primarily attributable to an increase in occupancy costs. Lower
actual merchandise margins for the three and six months of fiscal 2000 compared
to the same periods of fiscal 1999 also contributed to the decline. A third
factor contributing to the decline in fiscal 2000 are the higher depreciation
costs due to the fiscal 1999 rollout of new point of sale systems to every
store.
Selling expenses increased from $14.3 million for the second quarter of fiscal
1999 to $14.4 million for the second quarter of fiscal 2000, a 0.5% increase.
Selling expenses as a percentage of net sales increased from 18.0% for fiscal
1999 to 18.7% for fiscal 2000. Year-to-date selling expense fell 1.0% from $29.1
million through the first half of fiscal 1999 to $28.9 million for the first
half of fiscal 2000. As a percentage of net sales, selling expense in the first
six months increased from 18.3% for fiscal 1999, to 18.6% for fiscal 2000. The
increase was primarily attributable to higher sales salaries and higher selling
supplies as a percentage of net sales due to a decline in leverage provided by
comparable store sales.
General and administrative expenses decreased from $2.4 million in the second
quarter of fiscal 1999 to $2.3 million in the second quarter of fiscal 2000, a
3.7% decrease. As a percentage of net sales, general and administrative expenses
decreased to 3.0% for the second quarter of fiscal 2000 compared to 3.1% for the
second quarter of fiscal 1999. For the first half of fiscal 2000, general and
administrative expense fell 5.5% from $4.9 million for the six months ended July
31, 1999, to $4.6 million for the six months ended July 29, 2000. As a
percentage of net sales, general and administrative expense decreased to 3.0%
for the first half of fiscal 2000 compared to 3.1% for the first half of fiscal
1999. Decreases in general and administrative expenses for the first six months,
as a percentage of net sales, resulted primarily from leverage provided by the
restructuring of the Company's executive compensation plan.
9
<PAGE> 10
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
As a result of the above changes, the Company's income from operations decreased
$4.5 million to $5.4 million for the second quarter of fiscal 2000 compared to
$9.9 million for the second quarter of fiscal 1999, a 45.5% decrease. Income
from operations was 7.0% of net sales in the second quarter of fiscal 2000
compared to 12.4% in the second quarter of fiscal 1999. Income from operations,
year-to-date through July 29, 2000, was $12.5 million, a $7.1 million decrease
from the first half of the prior year. Income from operations was 8.1% of net
sales for the first six months of fiscal 2000 compared to 12.3% for the first
six months of fiscal 1999.
For the quarter ended July 29, 2000, other income increased $0.3 million. For
the six months ended July 29, 2000, other income increased $0.4 million. Other
income increased in the first six months of fiscal 2000 due to additional
interest income as well as income received from state tax incentive programs.
Income tax expense as a percentage of pre-tax income was 37.6% in the first half
of fiscal 2000 compared to 37.5% in the first half of fiscal 1999.
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. However, the first half of
each fiscal year is typically a period of decreasing cash flows created by
various operating, investing, and financing activities. During the first half of
fiscal 2000, the Company's had negative cash flow from operating activities of
$6.8 million. During the first half of fiscal 1999, the Company's had negative
cash flow from operating activities of $2.6 million.
The uses of cash for both twenty-six week periods include payment of annual
bonuses accrued at fiscal year end, changes in inventory and accounts payable
for build up of inventory levels, construction costs for opening new stores and
purchase of the Company's common stock. The primary differences creating a lower
use of cash this year versus last year are a lesser build up of inventory, a
lower level of capital expenditures, a lower level of bonuses paid and greater
reduction of held-to-maturity investments.
The Company has available an unsecured line of credit of $7.5 million and a $7.5
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 July 29, 2000, the Company had working capital of $110.0 million,
including $25.7 million of cash and cash equivalents and short-term investments
of $36.9 million. The Company has, from time to time, borrowed against these
lines during periods of peak inventory build-up. There were no bank borrowings
during the first half of fiscal 2000 and minor bank borrowings during the first
half of fiscal 1999.
During the first half of fiscal 2000 and 1999 the Company invested $8.4 million
and $10.5 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 $0.4
10
<PAGE> 11
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
million and $1.9 million in the first half of fiscal 2000 and 1999,
respectively, 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 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 was completed during the fourth
quarter of fiscal 1999. During the second quarter of fiscal 1999, the Company
also purchased a second corporate aircraft at a cost of $3.6 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 2000, the Company anticipates completing
approximately twelve additional store construction projects, including
approximately eight new stores and approximately four stores to be remodeled
and/or relocated. As of July 29, 2000, eight additional lease contracts have
been signed, and additional leases are in various stages of negotiation.
Management now estimates that total capital expenditures during fiscal 2000 will
be approximately $20.0 million before any landlord allowances, estimated to be
at approximately $3.0 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 1997, 1998, and 1999, 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
twenty-six week periods ended July 29, 2000, and July 31, 1999.
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
11
<PAGE> 12
THE BUCKLE, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
in fashion trends, competitive factors and general economic conditions, economic
conditions in the retail apparel industry, 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 and Use of Proceeds: None
Item 3. Defaults Upon Senior Securities: None
Item 4. Submission of Matters to a Vote of Security Holders:
(a) June 2, 2000, Annual Meeting
(b) Board of Directors:
Daniel J. Hirschfeld Robert E. Campbell
Dennis H. Nelson William D. Orr
Karen B. Rhoads Ralph M. Tysdal
Bill L. Fairfield Bruce Hoberman
<TABLE>
<CAPTION>
NUMBER OF SHARES*
-----------------
For Against Abstain Del N-Vote
----------- ------- ------- ----------
<S> <C> <C> <C> <C>
(c) 1. Election of Board of Directors:
Daniel J. Hirschfeld 19,576,547 0 62,053
Dennis H. Nelson 19,560,085 0 78,515
Karen B. Rhoads 19,575,547 0 63,053
Bill L. Fairfield 19,575,312 0 63,288
Robert E. Campbell 19,557,625 0 80,975
William D. Orr 19,576,237 0 62,363
Ralph M. Tysdal 19,556,995 0 81,605
Bruce Hoberman
2. Appoint Deloitte & Touche LLP
as independent accountants. 19,590,367 11,484 36,749
(d) None
</TABLE>
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 July 29, 2000.
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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: September 11, 2000 /s/ DENNIS H. NELSON
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DENNIS H. NELSON, President and CEO
Dated: September 11, 2000 /s/ KAREN B. RHOADS
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KAREN B. RHOADS, Vice President
of Finance and CFO
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