<PAGE>
FORM 10-Q
__________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
( X ) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended July 31, 1994
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to .
-------------------- -------------------
Commission file number 0-21182
-------------
ORCHARD SUPPLY HARDWARE STORES CORPORATION
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 95-4214109
- - ------------------------------- -----------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
6450 Via Del Oro, San Jose, California 95119
- - -------------------------------------- ------------------------------------
(Address of principal executive offices) (Zip Code)
(408) 281-3500
- - ------------------------------
(Registrant's telephone number,
including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (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
---- ----
At July 31, 1994 there were 6,983,121 shares of the registrant's Common Stock,
$0.01 par value, outstanding.
Page 1 of 14
<PAGE>
ORCHARD SUPPLY HARDWARE STORES CORPORATION AND SUBSIDIARY
INDEX
PART I. FINANCIAL INFORMATION PAGE NO.
Item 1. Financial Statements
Condensed Consolidated Balance Sheets:
July 31, 1994 and January 30, 1994 3
Condensed Consolidated Statements of Income:
Three Month and Six Month Periods Ended
July 31, 1994 and August 1, 1993 4
Condensed Consolidated Statements of Cash Flows:
Six Month Periods Ended July 31, 1994 and
August 1, 1993 5
Notes to Condensed Consolidated Financial
Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 13
Signatures 14
2
<PAGE>
PART 1 - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENT
ORCHARD SUPPLY HARDWARE STORES CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)
<TABLE>
<CAPTION>
July 31, January 30,
1994 1994
------------ -------------
(Unaudited)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 27,795 $ 75,588
Accounts receivable, net 15,739 13,245
Inventories 89,283 82,494
Prepaid expenses and other 9,213 6,575
Assets held for disposal 6,133 6,133
----------- ------------
Total current assets 148,163 184,035
PROPERTY, PLANT AND EQUIPMENT, net 120,479 105,874
OTHER ASSETS, net 20,810 19,826
----------- ------------
Total assets $ 289,452 $ 309,735
----------- ------------
----------- ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable, accrued and other liabilities $ 65,536 $ 56,818
Notes payable 1,592 1,494
Current portion of capital leases
and long term debt 1,680 30,727
----------- ------------
Total current liabilities 68,808 89,039
OTHER LIABILITIES, net of current portion 1,583 2,596
CAPITAL LEASES AND LONG-TERM DEBT,
net of current portion 135,645 156,273
----------- ------------
Total liabilities 206,036 247,908
----------- ------------
STOCKHOLDERS' EQUITY:
Common stock 70 69
Preferred stock 8 --
Additional paid-in-capital 91,452 72,275
Less notes receivable from
sale of common stock (156) (171)
Accumulated deficit (7,958) (10,346)
----------- ------------
Total equity 83,416 61,827
----------- ------------
Total liabilities and stockholders' equity $ 289,452 $ 309,735
----------- ------------
----------- ------------
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.
3
<PAGE>
ORCHARD SUPPLY HARDWARE STORES CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In Thousands, Except Per Share Data)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
----------------------- ------------------------
July 31, August 1, July 31, August 1,
1994 1993 1994 1993
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Sales $ 125,566 $ 101,206 $ 222,121 $ 191,567
Cost of goods sold 80,596 65,465 142,545 123,878
---------- --------- --------- ---------
Gross margin 44,970 35,741 79,576 67,689
Selling, general and administrative expenses 35,941 26,747 64,759 52,385
Pre-opening expenses 2,612 1,086 6,378 1,247
---------- --------- --------- ---------
Operating income 6,417 7,908 8,439 14,057
Interest expense 3,112 2,368 6,051 6,531
---------- --------- --------- ---------
Income before provision for income taxes
and extraordinary item 3,305 5,540 2,388 7,526
Income tax provision -- -- -- --
---------- --------- --------- ---------
Income before extraordinary item 3,305 5,540 2,388 7,526
Extraordinary item -- -- -- (5,363)
---------- --------- --------- ---------
Net income 3,305 5,540 2,388 2,163
Preferred stock dividends 303 -- 520 814
---------- --------- --------- ---------
Net income available to common stock $ 3,002 $ 5,540 $ 1,868 $ 1,349
---------- --------- --------- ---------
---------- --------- --------- ---------
Income per common and equivalent share:
Income before extraordinary item $ 0.43 $ 0.80 $ 0.27 $ 1.36
Extraordinary item -- -- -- (1.09)
---------- --------- --------- ---------
Net income $ 0.43 $ 0.80 $ 0.27 $ 0.27
---------- --------- --------- ---------
---------- --------- --------- ---------
Weighted average number of common and
common equivalent shares outstanding 6,998 6,940 6,983 4,934
---------- --------- --------- ---------
---------- --------- --------- ---------
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.
4
<PAGE>
ORCHARD SUPPLY HARDWARE STORES CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In Thousands)
<TABLE>
<CAPTION>
Six Months Ended
------------------------------
July 31, 1994 August 1, 1993
-------------- --------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 2,388 $ 2,163
Non-cash adjustments to net income--
Depreciation and amortization 3,887 3,323
Accretion of debt discount -- 38
Loss on asset disposals 758 23
Write-off of deferred financing costs -- 1,315
Premium on repayment of subordinated debentures -- 4,048
Changes in assets and liabilities--
Increase in accounts receivable (2,494) (1,655)
(Increase) decrease in inventories (6,789) 3,622
Increase in prepaid expenses and other (2,638) (503)
Increase in accounts payable, accrued and other liabilities 9,992 1,947
----------- -----------
Total Adjustments 2,716 12,158
----------- -----------
Net cash provided by operating activities 5,104 14,321
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property, plant and equipment, net (19,846) (4,656)
----------- -----------
Net cash used in investing activities (19,846) (4,656)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from public stock offering -- 48,529
Proceeds from issuance of preferred stock 19,400 --
Common stock issued upon exercise of warrants and options 439 19
Payment of notes receivable from sale of capital stock 15 3
Principal payments on capital leases and long-term debt (49,675) (44,860)
Premium on redemption of long term debt (2,287) (4,048)
Payment of preferred stock dividend (360) (2,500)
Transaction costs (681) (44)
Proceeds (repayment) of notes payable, net 98 (436)
Repurchase of capital stock -- (6)
----------- -----------
Net cash provided by (used in) financing activities 33,051 (3,343)
----------- -----------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (47,793) 6,322
CASH AND CASH EQUIVALENTS, beginning of period 75,588 4,475
----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ 27,795 $ 10,797
----------- -----------
----------- -----------
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.
5
<PAGE>
ORCHARD SUPPLY HARDWARE STORES CORPORATION AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. BASIS OF PRESENTATION
The condensed consolidated financial statements included herein have been
prepared by the Company, without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission (SEC). Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations. However, the Company believes that the
disclosures are adequate to make the information presented not misleading.
These condensed consolidated financial statements should be read in conjunction
with the financial statements and the notes thereto for the year ended January
30, 1994 included in the Company's Form 10-K.
The unaudited condensed consolidated financial statements included herein
reflect all adjustments (which include only normal, recurring adjustments) that
are, in the opinion of management, necessary to state fairly the results for the
periods presented. The results for such periods are not necessarily indicative
of the results to be expected for the full fiscal year.
2. EARNINGS PER SHARE
Net income (loss) per common and equivalent share is computed by dividing net
income (loss) available to common stock (net income less preferred stock
dividend requirements) by the weighted average number of common and equivalent
shares. Common and equivalent shares include common stock issuable upon
exercise of stock options and warrants (using the treasury stock method) less
shares assumed repurchased with the proceeds from the management notes.
Equivalents included in the weighted average number of shares assume the
conversion of options outstanding under the Nonqualified Stock Option Plan and
the warrants, unless antidilutive. Certain options granted to the President are
excluded from the calculation due to their contingent nature.
Pursuant to Securities and Exchange Commission Staff Accounting Bulletin No. 83,
common stock issued by the Company during the 12-month period prior to the
initial public offering and stock options and warrants granted during the same
period for which a measurement date has been established have been included in
the calculation of common and common equivalent shares using the treasury stock
method as if they were outstanding for all applicable periods.
6
<PAGE>
ORCHARD SUPPLY HARDWARE STORES CORPORATION AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
3. PREFERRED STOCK ISSUANCE AND REDEMPTION OF LONG-TERM DEBT
On February 25, 1994, the Company consummated a series of transactions
consisting of the following:
1. Issuance to an affiliate of 800,000 shares of 6% Cumulative Convertible
Preferred Stock at a price of $24.25 per share ("Preferred Stock
Offering").
2. Retirement of the remaining $19.3 million 14.5% Senior Subordinated
Discount Notes with the proceeds from the Preferred Stock Offering.
3. Retirement of $30.0 million 9.0% Senior Notes ("Old Senior Notes") with
proceeds from the offering of 9 3/8% Senior Notes ("Notes") which were
issued in January, 1994.
4. INCREASE IN AUTHORIZED SHARES OF STOCK
On May 20, 1994 the stockholders approved an increase in the number of shares of
Common Stock that the Company is authorized to issue from 8,000,000 to
16,000,000.
5. PRE-OPENING EXPENSES
Costs relating to the preparation and opening of new stores are expensed as
incurred. These expenses consist principally of store merchandising and
stocking expenses, personnel recruitment and training costs and grand opening
advertising and promotional expenses.
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
GENERAL
The Company completed the acquisition of six former Builders Emporium store
sites (Pasadena, Burbank, Van Nuys and Hollywood in metropolitan Los Angeles,
and Pismo Beach and Redding in Central and Northern California, respectively) on
November 16, 1993 and completed the acquisition of three other sites (South
Pasadena and West Los Angeles in metropolitan Los Angeles and Goleta in the
Santa Barbara area) on December 22, 1993 (the "Expansion").
The Company has incurred substantial pre-opening expenses in connection with
opening the nine Expansion store sites which will approximate $5.1 million in
fiscal 1994. Four of these stores were opened late in the first quarter of
fiscal 1994 and the five remaining stores were opened in May, 1994. These pre-
opening expenses, which consist principally of store merchandising and stocking
expenses, personnel recruitment and training costs and grand-opening advertising
and promotional expenses, commenced in the fourth quarter of fiscal 1993 and
continued into the second quarter of 1994.
As the Company accelerates its new store opening program, operating expenses as
a percent of sales for the new stores will initially be higher, adversely
affecting overall operating margins until these new stores achieve sales
maturity. In addition, the Company expects that it will generally experience
higher marketing, distribution and occupancy costs in its new stores in the
metropolitan Los Angeles market. The Company believes, however, that these
higher expenses will be offset by higher sales at these stores than are typical
of mature Orchard stores in Northern and Central California. The Company
expects that the impact of these factors will be to reduce operating margins in
fiscal 1994 and thereafter so long as the Company continues to open a large
number of stores relative to its existing store base.
8
<PAGE>
RESULTS OF OPERATIONS
The following table sets forth selected results of operations as percentages of
sales for the periods indicated:
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
-------------------- --------------------
July 31, August 1, July 31, August 1,
1994 1993 1994 1993
-------- --------- -------- ---------
<S> <C> <C> <C> <C>
Sales 100.0% 100.0% 100.0% 100.0%
Gross margin 35.8 35.3 35.8 35.3
Selling general and
administrative
expenses 28.6 26.4 29.2 27.3
Pre-opening expense 2.1 1.1 2.9 0.7
----- ----- ----- -----
Operating income 5.1 7.8 3.8 7.3
Interest expense, net 2.5 2.3 2.7 3.4
----- ----- ----- -----
Income before provision
for income taxes and
extraordinary item 2.6 5.5 1.1 3.9
Income tax provision - - - -
----- ----- ----- -----
Income before extra-
ordinary items 2.6 5.5 1.1 3.9
Extraordinary items - - - (2.8)
----- ----- ----- -----
Net income 2.6% 5.5% 1.1% 1.1%
----- ----- ----- -----
----- ----- ----- -----
</TABLE>
THREE MONTHS ENDED JULY 31, 1994 AND AUGUST 1, 1993
Sales for the second quarter ended July 31, 1994 increased by 24.1% to $125.6
million from $101.2 million in the second quarter of 1993. Increased sales from
14 new stores opened since the second quarter of last year were partially offset
by a 3.0% decrease in comparable store sales. The comparable store sales
decrease reflects both the unseasonably rainy weather in Northern California
during the first three weeks of May, 1994 and the impact of eight competing
warehouse home centers that opened in Orchard markets, principally in the second
half of 1993.
Gross margin increased $9.2 million from $35.7 million for the second quarter of
fiscal 1993 to $45.0 million for the comparable period this year. Gross margin
as a percent of sales increased from 35.3% for the second quarter of fiscal 1993
to 35.8% for the second quarter of fiscal 1994. The increase in gross margin
percentage resulted from an increase in purchase markup due mainly to a
reduction in the cost of merchandise as well as reduced permanent markdowns and
inventory shrinkage provision.
9
<PAGE>
Selling, general and administrative expenses for the second quarter of fiscal
1994 were 28.6% of sales compared with 26.4% of sales for the second quarter of
fiscal 1993, an increase of 2.2% of sales. The increase is partially
attributable to higher rent and payroll costs as a percent of sales of the
fourteen new stores opened since the first quarter of fiscal 1993 which have not
yet achieved sales maturity. The negative impact of the comparable store sales
decline on the sales base also contributed to higher selling, general and
administrative expenses as a percent of sales.
Operating income decreased by $1.5 million from $7.9 million for the second
quarter of 1993 to $6.4 million for the comparable period of 1994, primarily due
to a $1.5 million increase in pre-opening expenses associated with the Company's
increased expansion program. Pre-opening expenses are expensed as incurred.
Interest expense increased from $2.4 million for the second quarter of fiscal
1993 to $3.1 million for the second quarter of fiscal 1994. The increase is due
primarily to additional interest resulting from the issuance by the Company in
January 1994 of $100 million aggregate principal amount of 9 3/8% Notes which
was partially offset by reduced interest due to the retirement of $19.3 million
of 14.5% Senior Subordinated Discount Notes and $30.0 million of 9% Old Senior
Notes on February 25, 1994.
The Company did not record a tax provision or tax benefit as a result of the
benefit of net operating loss carry forwards against which a valuation allowance
has previously been provided.
SIX MONTHS ENDED JULY 31, 1994 AND AUGUST 1, 1993
Sales for the six months ended July 31, 1994 increased by 15.9% to $222.1
million from $191.6 million in the comparable period of 1993. Comparable store
sales declined 2.3% in the first half of 1994 due to unfavorable weather
conditions in Northern California during a five week period in April and May
1994 and the impact of the eight warehouse home centers opened in 1993.
Gross margin increased $11.9 million from $67.7 million for the first six months
of fiscal 1993 to $79.6 million for the comparable period of fiscal 1994. As a
percentage of sales gross margin increased from 35.3% for the first six months
of fiscal 1993 to 35.8% for the first six months of fiscal 1994. The increase
in gross margin percentage resulted from an increase in purchase markup due
mainly to a reduction in the cost of merchandise, as well as reduced permanent
markdowns and inventory shrinkage provision.
Selling, general and administrative expenses for the first six months of fiscal
1994 were 29.2% of sales compared with 27.3% of sales for the first six months
of fiscal 1993, an increase of 1.9% of sales. The increase is partially
attributable to higher rent and payroll costs as a percent of sales of the 14
new stores opened since the first six months of fiscal 1993 which have not yet
achieved sales maturity. The negative impact of the comparable store sales
decline on the sales base also contributed to higher selling, general and
administrative expenses as a percentage of sales.
10
<PAGE>
Operating income decreased by $5.6 million from $14.1 million for the first six
months of 1993 to $8.4 million for the comparable period of 1994, primarily due
to a $5.1 million increase in pre-opening expenses associated with the Company's
increased expansion program. Pre-opening expenses are expensed as incurred.
Interest expense decreased from $6.5 million for the first six months of 1993 to
$6.1 million for the first six months of 1994. Additional interest expense of
$0.7 million resulted from an increase in outstanding long term debt as
discussed above. However, the Company capitalized $0.8 million of construction
period interest of new store construction projects completed in the first and
second quarters of 1994. The first six months of 1994 included additional
interest income of $0.4 million.
The Company did not record a tax provision or tax benefit as a result of the
benefit of net operating loss carryforwards against which a valuation allowance
has previously been provided.
The results of operations for the first six months of fiscal 1993 include an
extraordinary charge of $5.4 million from the early extinguishment of $44.7
million of 14.5% Subordinated Notes on April 30, 1993.
LIQUIDITY AND CAPITAL RESOURCES
The Company's liquidity needs arise primarily from the funding of the Company's
capital expenditures, working capital requirements, ongoing expansion program,
and debt service on indebtedness.
The Company's wholly-owned subsidiary, Orchard Supply Hardware Corporation
("Orchard Supply"), has funded debt obligations including (i) up to $20.0
million of revolving credit availability under Orchard Supply's senior
revolving credit facility (the "Financing Agreement") (with an $8.0 million
sublimit for guarantees of letters of credit) of which no borrowings and $6.3
million of guarantees of letters of credit were outstanding as of July 31,
1994, (ii) $21.0 million outstanding under a store mortgage facility, (iii)
$13.7 million aggregate principal amount of warehouse mortgage notes, (iv)
$1.0 million of store mortgages assumed in connection with the acquisition of
a former Builders Emporium store site and (v) $100.0 million aggregate
principal amount of Notes. Orchard Supply's debt instruments contain financial
and operating covenants including, among other things, requirements that the
company maintain certain financial ratios and satisfy certain financial tests
and limitations on the Company's ability to make capital expenditures, to
incur other indebtedness, and to pay dividends. As of July 31, 1994, the
Company and Orchard Supply were in compliance with all covenants contained in
such debt instruments.
On February 25, 1994, the Company used the proceeds of the Preferred Stock
Offering to redeem the remaining 14.5% Subordinated Notes at their stated
redemption price of 107.25% of their principal amount, resulting in a call
premium of $1.4 million which was
11
<PAGE>
paid with available cash from operations. The net proceeds from the Notes were
applied as follows: (i) $30.9 million to retire the Old Senior Notes at their
stated redemption price of 103.0% of the principal amount thereof, (ii) $20.0
million to repay additional borrowings under the Financing Agreement used to
finance the Expansion, (iii) $35.0 million to fund additional investments
required to open the nine Expansion stores and (iv) the remainder for general
corporate purposes. Aggregate scheduled principal repayments on the Company's
long term debt for fiscal 1994, 1995 and 1996 are $0.7 million, $1.7 million and
$2.0 million, respectively.
The Company's business strategy requires that it maintain broad product lines
and large inventories, however, the effect of this strategy on working capital
is somewhat minimized through the receipt of trade credit. The Company's
working capital is also affected by accounts receivable arising from its
proprietary credit card which had an average monthly balance for fiscal 1993 of
$11.3 million. The Company will fund its working capital needs through a
combination of funds from operations and borrowings under the Financing
Agreement. The Financing Agreement permits borrowings based on percentages of
the Company's eligible inventory and accounts receivable and is to be used for
working capital and general corporate purposes. As of July 31, 1994, Orchard
Supply had no outstanding borrowings and $6.3 million in guarantees of letters
of credit and had additional borrowing capacity under the Financing Agreement of
$13.7 million. The Financing Agreement remains effective through October 29,
1995.
In connection with Orchard's expansion plans, the Company anticipates capital
expenditures of approximately $900,000 for furniture, fixtures and equipment for
each new store opened, a portion of which may be leased under operating leases.
Pre-opening expenses for the nine Expansion stores (approximately $5.3 million
in the aggregate) averaged approximately $650,000 for the six metropolitan Los
Angeles stores and $450,000 for the remaining stores. The Company expects that
for its subsequent metropolitan Los Angeles stores, pre-opening expenses will
average approximately $600,000 (compared to $450,00 in its Northern and Central
California markets). The initial inventory requirement for new stores net of
trade credit is estimated at $900,000 per store. In the event that the Company
is responsible for the renovation or remodeling of the existing space to be
leased, the Company anticipates incurring additional capital expenditures of
approximately $500,000 to $1,200,000 per store. If the Company elects to
purchase the real estate, the capital expenditure would range from approximately
$2,500,000 for owned store improvements constructed on leased land to $4,000,000
- - - $6,000,000 if the entire property were to be owned by the Company. The
Company's capital expenditure plan for fiscal 1994 includes three owned stores,
10 leased stores and the construction of one store on a ground lease.
The Company's three-year capital expenditure plan for fiscal 1994, 1995 and 1996
provides for annual capital expenditures of $26.0 million, $10.9 million to
$12.8 million (depending on the actual number of stores opened during the
period) and $13.5 million, respectively. The 1994 plan includes approximately
$2.2 million for furniture, fixtures and equipment and $7.4 million for tenant
improvements for all the Expansion stores combined. This capital expenditure
plan includes the expenditures of approximately $4.0 million to $4.5 million
annually for the maintenance of existing facilities. The remainder of the
annual budgeted amounts will be used primarily for the opening of
12
<PAGE>
other new stores, including fixtures and leasehold improvements with respect to
the new stores, and computer equipment. The Company has historically financed
some of its equipment through operating leases, and expects to be able to
procure such financing in the future. The inability of the Company to procure
such financing for its capital expenditure program may have a negative impact on
the ability of the company to make capital expenditures.
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
Exhibit
Number
-------
27.1 Financial Data Schedule for the Six Month
Period Ended July 31, 1994.
(b) Reports on Form 8-K
None.
13
<PAGE>
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.
ORCHARD SUPPLY HARDWARE STORES CORPORATION
Date: September 12, 1994 By: /s/ Maynard Jenkins
-------------------------------- ----------------------------
Maynard Jenkins
Chief Executive Officer
Date: September 12, 1994 By: /s/ Stephen M. Hilberg
-------------------------------- ----------------------------
Stephen M. Hilberg
Chief Financial Officer and
Vice President Finance
14
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
- - ------- -----------
<S> <C>
27.1 Financial Data Schedule for the Six Month Period
Ended July 31, 1994.
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONDENSED CONSOLIDATED BALANCE SHEETS AND CONDENSED CONSOLIDATED STATEMENTS OF
INCOME ON PAGES 3 AND 4 OF THE COMPANY'S FORM 10-Q FOR THE QUARTER ENDED JULY
31, 1994 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JAN-29-1995
<PERIOD-START> JAN-31-1994
<PERIOD-END> JUL-31-1994
<CASH> 27,795
<SECURITIES> 0
<RECEIVABLES> 16,947
<ALLOWANCES> 1,208
<INVENTORY> 89,283
<CURRENT-ASSETS> 148,163
<PP&E> 146,161
<DEPRECIATION> 25,682
<TOTAL-ASSETS> 289,452
<CURRENT-LIABILITIES> 68,808
<BONDS> 135,645
<COMMON> 70
0
8
<OTHER-SE> 83,338
<TOTAL-LIABILITY-AND-EQUITY> 289,452
<SALES> 222,121
<TOTAL-REVENUES> 222,121
<CGS> 142,545
<TOTAL-COSTS> 142,545
<OTHER-EXPENSES> 71,137
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 6,051
<INCOME-PRETAX> 2,388
<INCOME-TAX> 0
<INCOME-CONTINUING> 2,388
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,388
<EPS-PRIMARY> 0.27
<EPS-DILUTED> 0.27
</TABLE>
