<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended December 26, 1998
----------------------------------------------
or
[ ] TRANSITION REPORT PURSUANT OF SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
------------------------- --------------------
Commission File Number: 0 - 20242
--------------------------------------------------------
CENTRAL GARDEN & PET COMPANY
- --------------------------------------------------------------------------------
Delaware 68-0275553
- --------------------------------------------------------------------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
3697 Mt. Diablo Blvd., Suite 310, Lafayette, California 94549
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(Address of principle executive offices)
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(925) 283-4573
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(Registrant's telephone number, including area code)
- --------------------------------------------------------------------------------
(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. [X] Yes [ ] No
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
[ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common Stock Outstanding as of December 26, 1998 27,625,490
Class B Stock Outstanding as of December 26, 1998 1,661,762
<PAGE>
CENTRAL GARDEN & PET COMPANY FORM 10-Q
TABLE OF CONTENTS
PART 1. FINANCIAL INFORMATION
-------------------------------
1. Financial Statements
Condensed Consolidated Balance Sheets
September 26, 1998 and December 26, 1998
Consolidated Statements of Cash Flows
Three Months Ended December 27, 1997 and December 26, 1998
Consolidated Statements of Operations
Three Months Ended
December 27, 1997 and December 26, 1998
Notes to Consolidated Financial Statements
2. Management's Discussion and Analysis of Financial Condition and Results of
Operations
3. Quantitative and Qualitative Disclosures About Market Risk
PART II. OTHER INFORMATION
----------------------------
1. Legal Proceedings
2. Changes in Securities and Use of Proceeds
3. Defaults Upon Senior Securities
4. Submission of Matter to a Vote of Securities Holders
5. Other Information
6. Exhibits and Reports on Form 8-K
<PAGE>
CENTRAL GARDEN & PET COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands, except share amounts)
<TABLE>
<CAPTION>
September 26, December 26,
1998 1998
-------------------- --------------------
<S> <C> <C>
ASSETS
Current Assets:
Cash & cash equivalents $ 10,328 $ 2,891
Accounts receivable (less allowance for doubtful
accounts of $6,458 and $6,475) 142,293 133,150
Inventories 292,809 410,442
Prepaid expenses and other assets 26,884 25,534
-------------------- --------------------
Total current assets 472,314 572,017
Land, Buildings, Improvements and Equipment - net 86,382 89,026
Goodwill - net 339,430 337,317
Other Assets 30,574 42,792
-------------------- --------------------
Total $928,700 $1,041,152
==================== ====================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Notes payable $ 6,956 $ 38,681
Accounts payable 153,739 260,649
Accrued expenses 32,767 33,788
Current portion of long-term debt 1,139 1,120
-------------------- --------------------
Total current liabilities 194,601 334,238
Long-Term Debt 125,125 124,786
Deferred Income Taxes and Other Long-Term
Obligations 20,200 20,191
Commitments and Contingencies - -
Shareholders' Equity:
Preferred stock, $.01 par value: 1,000,000 shares
authorized; no shares outstanding September 26,
1998 and December 26, 1998 - -
Class B stock, $.01 par value: 1,661,762 shares outstanding
September 26, 1998 and December 26, 1998 16 16
Common stock, $.01 par value: 29,718,530 issued and 29,646,530
outstanding September 26, 1998; 29,772,490 issued and
27,625,490 outstanding December 26, 1998 298 298
Additional paid-in capital 519,933 520,186
Retained earnings 69,984 69,549
Treasury Stock, at cost (1,418) (28,091)
Restricted stock deferred compensation (39) (21)
-------------------- --------------------
Total shareholders' equity 588,774 561,937
-------------------- --------------------
Total $928,700 $1,041,152
==================== ====================
</TABLE>
See notes to consolidated financial statements
<PAGE>
CENTRAL GARDEN & PET COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
<TABLE>
<CAPTION>
Three Months Ended
December 27, December 26,
1997 1998
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<S> <C> <C>
Cash Flows From Operating Activities:
Net Loss $ (519) $ (435)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation and amortization 1,701 5,112
Change in assets and liabilities:
Receivables (5,465) 9,143
Inventories (71,190) (117,633)
Prepaid expenses and other assets (2,047) 2,157
Accounts payable 20,137 106,910
Accrued expenses and other liabilities (590) 1,012
------------------ --------------------
Net cash provided (used) in operating activities (57,973) 6,266
Cash Flows From Investing Activities:
Additions to land, buildings, improvements and equipment (1,767) (5,393)
Payment to acquire company, held in escrow account - (13,275)
Payments to acquire companies, net of cash acquired (137,911) -
------------------ --------------------
Net cash used in investing activities (139,678) (18,668)
Cash Flows From Financing Activities:
Proceeds from (repayments of) notes payable - net 39 31,725
Repayments of long-term debt - (358)
Proceeds from issuance of stock - net 175,343 253
Payments to reacquire stock - (26,655)
------------------ --------------------
Net cash provided by financing activities 175,382 4,965
Net Decrease in Cash (22,269) (7,437)
Cash at Beginning of Period 100,125 10,328
------------------ --------------------
Cash at End of Period $ 77,856 $ 2,891
================== ====================
Supplemental Information:
Cash paid for interest $ 210 $ 288
Cash paid for income taxes 147 42
Assets (excluding cash) acquired through purchase of
companies 63,562 -
Liabilities assumed through purchase of companies 49,112 -
</TABLE>
See notes to consolidated financial statements
<PAGE>
CENTRAL GARDEN & PET COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended
December 27, December 26,
1997 1998
------------------------- -------------------------
<S> <C> <C>
Net Sales $138,827 $228,021
Cost of Goods Sold and Occupancy 105,505 171,540
------------------------- -------------------------
Gross profit 33,322 56,481
Selling, General and
Administrative Expenses 33,289 54,891
------------------------- -------------------------
Income from Operations 33 1,590
Interest Expense - Net 927 2,341
------------------------- -------------------------
Loss before income taxes (894) (751)
Income Taxes (375) (316)
------------------------- -------------------------
Net Loss $ (519) $ (435)
========================= =========================
Net Loss per Share
Basic and Diluted $ (0.02) $ (0.01)
========================= =========================
</TABLE>
<PAGE>
Central Garden & Pet Company
Notes to Consolidated Financial Statements
Three Months Ended December 26, 1998
(Unaudited)
1. Basis of Presentation
---------------------
The condensed consolidated balance sheet as of December 26, 1998 and the
consolidated statements of operations and cash flows for the three months
ended December 26, 1998 and December 27, 1997 have been prepared by the
Company, without audit. The condensed consolidated balance sheet as of
September 26, 1998 has been derived from the audited financial statements
of the Company for the year ended September 26, 1998. In the opinion of
management, all adjustments (which include only normal recurring
adjustments) considered necessary to present fairly the financial position,
results of operations and cash flows of the Company for the periods
mentioned above, have been made.
Due to the seasonal nature of the Company's business, the results of
operations for the three months ended December 26, 1998 are not indicative
of the operating results that may be expected for the year ending September
25, 1999.
It is suggested that these interim financial statements be read
in conjunction with the annual audited financial statements, accounting
policies and financial notes thereto, included in the Company's 1998 Annual
Report which has previously been filed with the Securities and Exchange
Commission.
2. Share Repurchase Program
------------------------
On December 18, 1998, the Company's Board of Directors authorized the
Company to increase the share repurchase program up to a maximum of $55
million of common shares. During the three-month period ended December 26,
1998, the Company repurchased 2,100,000 shares for a total of $26.7
million. As of February 8, 1999, the Company had purchased an additional
1,060,000 shares for a total of $14.0 million.
3. Earnings Per Share
------------------
The following is a reconciliation of the numerators and denominators of the
basic and diluted per-share computations for income from continuing
operations:
For the Three-Month Period Ended December 26, 1998
Net Per-Share
Loss Shares Amount
Basic and Diluted EPS $(435,000) 31,227,000 $(0.01)
<PAGE>
For the Three-Month Period Ended December 27, 1997
Net Per-Share
Loss Shares Amount
Basic and Diluted EPS $(519,000) 21,318,000 $(0.02)
Options to purchase 2,037,930 and 1,388,308 shares of common stock at
prices ranging from $1.30 to $33.94 per share were outstanding during the
three-month periods ended December 26, 1998 and December 27, 1997,
respectively, but were not included in the computation of diluted EPS
because the assumed exercise would have been anti-dilutive in each period.
Shares of common stock from the assumed conversion of the Company's
convertible securities totaling 4,107,143 were also not included in the
computation of diluted EPS for the three-month periods ended December 26,
1998 and December 27, 1997 because the assumed conversion would have been
anti-dilutive.
4. Prior Year Acquisitions
-----------------------
The following table summarizes on a pro forma basis the combined results of
operations of the Company as if the Kaytee Products, TFH Publications and
Pennington Seed, Inc. acquisitions made during fiscal 1998 had occurred
on September 29, 1996. The pro forma results of operations also reflects
pro forma adjustments for cash paid and stock issued to facilitate the
acquisitions and for the amortization of goodwill. Although this pro
forma combined information includes the results of operations of the
acquisitions, it does not necessarily reflect the results of operations
that would have occurred had the companies been managed by the Company
prior to their acquisition.
Three Months Ended
December 27,
1997
------------------
(In thousands,
except per
share amounts)
Net Sales $208,156
Gross profit 55,738
Income from operations 612
Loss before income taxes (5,276)
Net Loss $ (3,069)
Net Loss per Share
Basic and Diluted $ (0.14)
<PAGE>
5. New Accounting Pronouncements
-----------------------------
In June 1998, the Financial Accounting Standards Board issued SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities." SFAS No.
133 establishes accounting and reporting standards for derivative
instruments, including certain derivative instruments embedded in either
assets or liabilities. This statement is effective for fiscal years
beginning after June 15, 1999 and is not to be applied retroactively to
financial statements for prior periods. If adopted at December 26, 1998,
the application of the standard would not have had a material effect on the
Company's consolidated financial position or results of operations.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Overview
The Company entered into an agreement effective October 1, 1995 with Solaris to
become both the master agent and master distributor for sales of Solaris
products nationwide. Management believes that the relationship with Solaris
embodied in the Solaris Agreement has had a substantial impact on the Company's
results of operations. Under the Solaris Agreement, which runs through
September 30, 1999, the Company, in addition to serving as the master agent and
master distributor for sales of Solaris products, provides a wide range of
value-added services including logistics, order processing and fulfillment,
inventory distribution and merchandising. However, Solaris continues to
negotiate its sales prices directly with its direct sales accounts. As a
result of the Solaris Agreement, a majority of the Company's sales of Solaris
products are derived from servicing direct sales accounts, whereas in 1995 and
prior, a majority of the Company's sales of Solaris products were made by the
Company as a traditional distributor. A substantial portion of these sales
consists of large shipments to retail distribution centers which are
characterized by lower gross profit as a percentage of net sales compared with
sales made by the Company as a traditional distributor. The Company believes
that the operating expenses associated with this type of sale are lower than the
operating expenses associated with sales made by the Company as a traditional
distributor. The Company believes that the gross profit as a percentage of net
sales associated with the Company's services to Solaris direct sales accounts is
higher than the gross profit as a percentage of net sales associated with the
Company's historical agency sales due to the greater services provided pursuant
to the Solaris Agreement.
In addition, under the Solaris Agreement, the Company's inventories of Solaris
products have increased significantly since the Company is not only carrying
inventories to support its own sales of Solaris products but also certain
inventory previously carried by Solaris as well as additional inventories to
support sales of Solaris products by the Company's network of independent
distributors.
The Solaris Agreement provides for the Company to be reimbursed for costs
incurred in connection with services provided to Solaris' direct sales accounts
and to receive payments based on the growth of sales of Solaris products. The
Company also shares with Solaris in the economic benefits of certain cost
reductions, to the extent achieved. As a result, management believes that the
Company's profitability is more directly attributable to the success of Solaris
than it has been in the past.
Monsanto has announced that it sold its Solaris lawn and garden business
exclusive of its Roundup herbicide products for consumer use to The Scotts
Company ("Scotts") and that it has entered into a separate, long-term, exclusive
agreement pursuant to which Monsanto will continue to make Roundup herbicide
products for consumer use and Scotts will market the products. Scotts has been
for many years a substantial supplier to the Company and, in connection with its
direct sales, a substantial purchaser of the Company's services.
The Company expects to enter into a new relationship with Scotts effective
October 1, 1999. Since Scotts will then be the Company's largest lawn and
garden customer by a substantial margin, the terms of this new arrangement will
have a substantial impact on the Company's future profitability. There can be
no assurance that the Company will be successful in negotiating and implementing
a new relationship with Scotts or that the new relationship with Scotts will
provide the Company with
<PAGE>
comparable profitability to the profitability it has experienced from its prior
relationships with Solaris and Scotts.
The sale of the Solaris business by Monsanto and the approaching end of the
Solaris Agreement subject the Company's lawn and garden business to significant
uncertainties. These include the negotiation of new relationships with Scotts
and the final accounting for all issues between the Company and Monsanto under
the Solaris Agreement, such as the amounts receivable from Monsanto for cost
reimbursements, payments for cost reductions and payments for services; the
amounts payable to Monsanto for inventory; and responsibility for obsolete
inventory and for non-payment by Solaris' direct sales accounts. The resolution
of such uncertainties could have a material effect, either positive or negative,
on the Company's results of operations.
Three Months Ended December 26, 1998
Compared with Three Months Ended December 27, 1997
Net sales for the three months ended December 26, 1998 increased by 64.2% or
$89.2 million from $138.8 million for the comparable fiscal 1998 period. The
$89.2 million increase includes approximately $74.8 million attributable to
companies acquired subsequent to November 1997. The sales increase related to
existing operations, $14.4 million, was largely attributable to the sale of lawn
and garden products of which a substantial portion were shipped to retail
distribution centers.
Gross profit increased by 69.5% or $23.2 million from $33.3 million during the
three months ended December 27, 1997 to $56.5 million for the three months ended
December 26, 1998. The increase in gross profit relates principally to the
newly acquired operations. Gross profit as a percentage of net sales increased
from 24.0% in the quarter ended December 27, 1997 to 24.8% for the comparable
fiscal 1999 period. The increase in gross margin as a percentage of net sales
was attributable to the newly acquired branded products businesses which
generate a higher gross margin percent by lawn and garden and pet supplies
products. Gross margin as a percentage of net sales related to lawn and garden
products decreased from 18.6% in the quarter ended December 27, 1997 to 16.8%
in the comparable fiscal 1999 quarter. The decrease is primarily the result of
significantly greater sales to retail distribution centers which carry a lower
gross margin. As future sales to retail distribution centers decrease in
relation to total lawn and garden sales, gross profit as a percentage of net
sales of lawn and garden products should return to historical levels.
For the three months ended December 26, 1998, selling, general and
administrative expenses increased by $21.6 million from $33.3 million for the
comparable fiscal 1999 quarter. A majority of the increase is attributable to
the newly acquired businesses. As a percentage of net sales, these expenses
increased slightly from 24.0% during the quarter ended December 27, 1997 to
24.1% for the quarter ended December 26, 1998. Selling, general and
administrative expenses as a percentage of net sales attributable to existing
operations was 23.1% for the fiscal 1999 quarter.
Net interest expense for the quarter ended December 26, 1998 increased by $1.4
million from $.9 million for the three months ended December 27, 1997 to $2.3
million. The increase is net interest expense is the result of a reduction in
interest income and an increase in interest expense due to cash used, and
borrowings incurred, associated with the newly acquired businesses. Funds
which were invested in short-term securities during the first fiscal quarter
of 1998 were subsequently used to acquire the new operations. Average short-
term borrowings for the
<PAGE>
three months ended December 26, 1998 were $14.0 million compared with $5.3
million for the similar fiscal 1998 quarter. Average interest rates on short-
term borrowings were 8.2% and 9.4%, respectively.
The Company's effective income tax rate was 42.0% for both periods.
Impact of Year 2000
State of Readiness. In early 1998, the Company conducted an overall assessment
of its computer systems, including Year 2000 readiness. Based on this
assessment, the Company has developed a plan to deal with the Year 2000 Issue,
which covers both systems and vendor/customer issues. The plan includes both
upgrades to or replacement of current systems to bring all of the Company's
systems into compliance. Many of the existing information systems used by
subsidiaries or divisions acquired by the Company are being replaced, primarily
in response to business reasons apart from the Year 2000 Issue.
The Company will use primarily internal resources to reprogram or replace and
test its information systems for Year 2000 compliance. In addition, the Company
will use certain external resources to replace outdated information systems at
certain of its subsidiaries' operations. The Company expects that the majority
of the systems changes will be completed by June of 1999, and that the remaining
issues will be resolved by the summer of 1999.
The plan developed to address vendor and customer issues includes systems
integration, testing and communication strategies. The Company has begun the
process of initiating formal communications with significant vendors and
customers to determine the extent to which the Company may be vulnerable to a
failure by any of these third parties to remediate their own Year 2000 Issues.
The Company is currently testing electronic data transmissions to and from its
major vendors and customers to ensure Year 2000 compliance. The Company expects
to conclude this testing by early 1999. In addition to vendors and customers,
the Company also relies upon governmental agencies, utility companies,
telecommunication service companies and other service providers outside of the
Company's control. There can be no assurance that the Company's vendors or
customers, governmental agencies or other third parties will not suffer a Year
2000 business disruption that could have a material adverse effect on the
Company's results of operations or financial position.
Costs to Address the Year 2000 Issue. To date, the Company has incurred no
significant incremental costs addressing Year 2000 Issues, although it has
incurred costs, independent of the Year 2000 Issue, relating to the
implementation of new systems for certain subsidiaries. The Company has no
separate budget and none is currently planned for Year 2000 Issues. The Company
does not expect expenditures relating to the Year 2000 Issue to be material or
to have a significant impact on the Company's results of operations or financial
position.
Risks Presented by the Year 2000 Issue. The Company presently believes that
with the planned upgrades and implementation of new systems and software, the
Year 2000 Issue will not pose significant operational problems for its computer
systems. However, if such conversions are not made, or are not completed in a
timely manner, the Year 2000 Issue could have a material impact on the
operations of the Company. In addition, if any third parties who provide goods
or services essential to
<PAGE>
the Company's business activities fail to address appropriately their Year 2000
Issues, such failure could have a material adverse effect on the Company's
results of operations or financial position.
Contingency Plans. The Company's Year 2000 plan includes the development of
contingency plans in the event that the Company has not completed all of its
remediation plans in a timely manner or any third parties who provide goods or
services essential to the Company's business fail to appropriately address their
Year 2000 issues. The Company expects to conclude the development of these
contingency plans by the end of the third quarter of 1999.
<PAGE>
Liquidity and Capital Resources
The Company has financed its growth through a combination of bank borrowings,
supplier credit, internally generated funds and sales of securities to the
public. The Company received net proceeds (after offering expenses) of
approximately $431.0 million from its five public offerings of common stock in
July 1993, November 1995, July 1996, August 1997 and January 1998. In November
1996, the Company completed the sale of $115 million 6% subordinated convertible
notes generating approximately $112 million net of underwriting commissions.
The Company's business is highly seasonal and its working capital requirements
and capital resources track closely to this seasonal pattern. During the first
fiscal quarter accounts receivable reach their lowest level while inventory,
accounts payable and short-term borrowings begin to increase. Since the
Company's short-term credit line fluctuates based upon a specified asset
borrowing base, this quarter is typically the period when the asset borrowing
base is at its lowest and consequently the Company's ability to borrow is at its
lowest. During the second fiscal quarter, receivables, accounts payable and
short-term borrowings begin to increase, reflecting the build-up of inventory
and related payables in anticipation of the peak selling season. During the
third fiscal quarter, principally due to the Solaris Agreement, inventory levels
remain relatively constant while accounts receivable peak and short-term
borrowings start to decline as cash collections are received during the peak-
selling season. During the fourth fiscal quarter, inventory levels are at their
lowest, and accounts receivable and payables are substantially reduced through
conversion of receivables to cash.
For the three months ended December 26, 1998, the Company generated cash from
operating activities of $6.3 million principally relating to the normal cycle of
accounts receviable collection, offset by inventory build up. Net cash used in
investing activities of $18.7 million resulted from a $13.3 million payment
held in escrow in December 1998 for an acquisition completed in January 1999,
and from the acquisition of office and warehouse equipment. Cash generated
from financing activities of $5.0 million consisted principally of borrowings
of $31.7 million of short-term debt offset by repayments of $26.7 million to
acquire treasury shares.
The Company has a $100 million line of credit with Congress Financial
Corporation (Western). The available amount under the line of credit fluctuates
based upon a specific asset borrowing base. The line of credit bears interest
at a rate equal to the prime rate per annum and is secured by substantially all
of the Company's assets. At December 26, 1998, the Company had $38.8 million
outstanding borrowings and had $61.2 million of available borrowing capacity
under this line. The Company's line of credit contains certain financial
covenants such as minimum net worth and minimum working capital requirements.
The line also requires the lender's prior written consent to any acquisition of
a business. In connection with the acquisition of one company in fiscal 1998,
the Company assumed a $60.0 million line of credit, of which $60.0 million was
available at December 26, 1998.
The Company believes that cash flow from operations, funds available under its
line of credit and arrangements with suppliers will be adequate to fund its
presently anticipated working capital requirements for the foreseeable future.
The Company anticipates that its capital expenditures will not exceed $15.0
million for the next 12 months.
<PAGE>
As part of its growth strategy, the Company has engaged in acquisition
discussions with a number of companies in the past and it anticipates it will
continue to evaluate potential acquisition candidates. If one or more potential
acquisition opportunities, including those that would be material, become
available in the near future, the Company may require additional external
capital. In addition, such acquisitions would subject the Company to the
general risks associated with acquiring companies, particularly if the
acquisitions are relatively large.
Weather and Seasonality
Historically, the Company's sales of lawn and garden products have been
influenced by weather and climate conditions in the markets it serves. For
example, during the first six months of both 1993 and 1995 and the first three
months of the calendar year in 1996, the Company's results of operations were
negatively affected by severe weather conditions in many parts of the country.
Additionally, the Company's business is highly seasonal. In fiscal 1998,
approximately 66% of the Company's sales occurred in the first six months of the
calendar year. Substantially all of the Company's operating income is typically
generated in this period which has historically offset the operating losses
incurred during the first fiscal quarter of the year.
ITEM 3. Quantitative and Qualitative Disclosure About Market Risk
The Company believes there has been no material change in its exposure to market
risk from that discussed in the Company's 1998 Consolidated Financial
Statements and Annual Report on Form 10-K for the year ended September 26, 1998.
<PAGE>
CENTRAL GARDEN & PET COMPANY FORM 10-Q
PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings
Not Applicable
ITEM 2. Changes in Securities and Use of Proceeds
Not Applicable
ITEM 3. Defaults Upon Senior Securities
Not Applicable
ITEM 4. Submission of Matter to a Vote of Securities Holders
Not Applicable
ITEM 5. Other Information
Not Applicable
ITEM 6. Exhibits and Reports on Form 8-K
(a) The following report on Form 8-K was filed during the quarter
ended December 26, 1998.
(1) On December 21, 1998, the Company filed a report on Form 8-K
dated December 18, 1998, disclosing that the Company' Board
of Directors has authorized an increase of $30 million in the
Company's share repurchase program, bringing the existing
program from $25 million to $55 million.
<PAGE>
CENTRAL GARDEN & PET COMPANY FORM 10-Q
SIGNATURES
----------
Pursuant to the requirements of the Securities Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunder
duly authorized.
CENTRAL GARDEN & PET COMPANY
-------------------------------------------
Registrant
Dated: February 9, 1999
-------------------------------------------
William E. Brown, Chairman of the Board and
Chief Executive Officer
/s/ Robert B. Jones
-------------------------------------------
Robert B. Jones, Vice President-Finance and
Chief Financial Officer
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM 10Q AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-25-1999
<PERIOD-START> SEP-27-1998
<PERIOD-END> DEC-26-1998
<CASH> 2,891
<SECURITIES> 0
<RECEIVABLES> 133,150
<ALLOWANCES> 6,475
<INVENTORY> 410,442
<CURRENT-ASSETS> 572,017
<PP&E> 89,026
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,041,152
<CURRENT-LIABILITIES> 334,238
<BONDS> 115,000
0
0
<COMMON> 298
<OTHER-SE> 16
<TOTAL-LIABILITY-AND-EQUITY> 1,041,152
<SALES> 228,021
<TOTAL-REVENUES> 228,021
<CGS> 171,540
<TOTAL-COSTS> 54,891
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,341
<INCOME-PRETAX> (751)
<INCOME-TAX> (316)
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (435)
<EPS-PRIMARY> (.01)
<EPS-DILUTED> (.01)
</TABLE>
