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SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
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FORM 10-Q
Quarterly Report pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quarter Ended July 28, 1996
(First Quarter)
Commission File Number 0-22252
CATTLEMAN'S, INC.
(Exact name of registrant as specified in its charter)
Delaware 38-3012740
(State or other jurisdiction (IRS. Employer
of incorporation or organization) Identification Number)
1825 Scott Street
Detroit, Michigan 48207
(Address of executive offices) (Zip Code)
Company's telephone number, including area code: (313) 833-2700
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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 twelve months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
requirements for the past 90 days.
YES X NO
--- ---
Indicate the number of share outstanding of each of the Registrant's classes of
common stock, as of the latest practicable date.
Class Outstanding at August 30, 1996
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Common stock, $.001 per share 3,541,583
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Part 1: Financial Information
Cattleman's, Inc.
Item 1 Financial Statements
Condensed Consolidated Balance Sheet
(unaudited)
<TABLE>
<CAPTION>
($ in Thousands)
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July 28, 1996 April 28, 1996
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ASSETS
<S> <C> <C>
Current Assets
Cash $ 130 $ 738
Accounts Receivable 4,971 4,700
Inventory - Finished Goods 3,668 4,798
Inventory - Supplies 216 202
Prepaids 432 580
Income Tax Refundable 283 334
Deferred Income Taxes 113 113
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Current Assets 9,813 11,464
Property, Plant & Equipment 11,439 11,038
Accumulated Depreciation (5,261) (4,984)
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Net 6,178 6,054
Other Assets
Goodwill 336 329
Loans receivable, officers 296 295
Other 225 226
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Other Assets 857 850
$ 16,848 $ 18,368
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LIABILITIES
Accounts Payable $ 4,191 $ 4,220
Accrued Expenses 724 876
Current Portion, long-term debt 621 637
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Current Liabilities 5,536 5,733
Long-term Debt 5,998 7,416
Deferred Income Tax 181 181
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6,179 7,597
Total Liabilities 11,715 13,330
EQUITY
Capital 794 794
Retained Earnings 4,339 4,244
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5,133 5,038
$ 16,848 $ 18,368
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</TABLE>
The accompanying notes are an integral part of the consolidated statements.
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Cattleman's, Inc.
Item 1 Financial Statements
Condensed Consolidated Statement of Operations
(unaudited)
<TABLE>
<CAPTION>
($ in thousands except per share data)
THIRTEEN WEEKS ENDED
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July 28, 1996 July 30, 1995
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<S> <C> <C> <C> <C>
Sales $ 32,473 100.0% $ 33,103 100.0%
Cost of Goods Sold 31,010 95.5% 31,386 94.8%
Selling, General & Admin. 1,140 3.5% 1,109 3.4%
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Earnings From Operations 323 1.0% 608 1.8%
Interest 175 0.5% 155 0.5%
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Income Before Taxes 148 0.5% 453 1.4%
Income Tax 53 0.2% 163 0.5%
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Net Earnings $ 95 0.3% $ 290 0.9%
======================== ===========================
Earnings Per Share $0.03 $0.09
============ =============
Average Shares Outstanding 3,291,583 3,279,583
============ =============
</TABLE>
The accompanying notes are an integral part of the consolidated statements.
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Cattleman's, Inc.
Item 1 Financial Statements
Condensed Consolidated Statement of Cash Flows
(unaudited)
<TABLE>
<CAPTION>
($ in Thousands) Thirteen Weeks Ended
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July 28, 1996 July 30, 1995
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<S> <C> <C>
CASH FLOW FROM OPERATIONS $ 1,228 $ 1,370
INVESTING ACTIVITIES
Capital Expenditures & Other (402) (123)
FINANCING ACTIVITIES
Net Repayments on debt (1,434) (1,937)
Change in Cash (608) (690)
Beginning Cash 738 1,148
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Ending Cash $ 130 $ 458
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SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the period for:
Interest $ 182 $ 168
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Income Taxes $ 0 $ 0
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</TABLE>
The accompanying notes are an integral part of the consolidated statements.
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CATTLEMAN'S, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
The accompanying consolidated financial statements of Cattleman's, Inc.
("Cattleman's") have been prepared in accordance with the instructions for Form
10-Q and are unaudited. The statements include all adjustments (consisting of
normal recurring accruals) which Cattleman's considers necessary for a fair
presentation of the interim periods. The accounting policies followed by
Cattleman's and additional footnotes are included in Cattleman's fiscal 1996
annual report on Form 10-K.
This 10-Q is written with the presumption that the users of the interim
financial statements have read or have access to Cattleman's Form 10-K, which
contains the latest audited financial statements and notes thereto, together
with Management's Discussion and Analysis of Financial Condition and Results of
Operations as of April 28, 1996 and for the year then ended. Only material
changes in financial condition and results of operations are discussed in the
remainder of Part I.
Cattleman's interim operating results may be subject to substantial
fluctuations which do not necessarily occur or recur on a seasonal basis. Such
fluctuations are normally caused by competitive and other conditions in the
cattle and boxed beef markets over which Cattleman's has little or no control.
Therefore, the results of operations for the interim periods presented are not
necessarily indicative of the results to be attained for the full fiscal year.
2. COMMITMENTS AND CONTINGENCIES
Cattleman's is involved in various disputes incident to the ordinary course of
its business. In the opinion of management, any liability for which provision
has not been made relative to the various lawsuits, claims or administrative
proceedings pending against Cattleman's should not have a material adverse
effect on its financial position.
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CATTLEMAN'S, INC.
ITEM 2 Management's Discussion and Analysis of Financial Condition and
Results of Operations - First Quarter - Fiscal 1997
COMPARISON OF THIRTEEN WEEKS ENDED JULY 28, 1996 TO THIRTEEN WEEKS ENDED JULY
30, 1995
RESULTS OF OPERATIONS
Sales for the thirteen weeks ended July 28, 1996 and July 30, 1995 were
$32,473,000 and $33,103,000, respectively. Sales dollars dropped 2% due to a
decrease in gross tonnage sold offset by an increase in the sales price per
pound. Retail sales, as a percent of total sales, increased approximately 1.0
percent over the prior period.
Cost of Goods Sold for the thirteen weeks ended July 28, 1996 and July 30, 1995
was $31,011,000 and $31,386,000, respectively, a decrease of $378,000. This
represents 95.5% and 94.8% of sales for the respective periods. This increase
of .7% resulted primarily from higher prices for beef carcasses during the
quarter ended July 28, 1996.
Selling, General and Administrative Expenses for the thirteen weeks ended July
28, 1996 and July 30, 1995 were $1,139,000 and $1,109,000, respectively. These
costs remained relatively stable.
Earnings from operations totaled $323,000 for this quarter as compared to
$608,000 for the quarter ended July 30, 1995.
Interest expense totaled $176,000 for the thirteen weeks ended July 28, 1996,
up from $155,000 for the thirteen weeks ended July 30, 1995. The increase
resulted primarily from higher average interest rates and higher average
balances on our long and short-term debt instruments.
Net Income for the thirteen weeks ended July 28, 1996 totaled $95,000 compared
to $290,000 for the thirteen weeks ended July 30, 1995. The $195,000 decrease
resulted primarily from lower margins in both the processing and retail
operations.
FINANCIAL CONDITION
Cash Provided From Operations for the thirteen weeks ended July 28, 1996,
totaled $1.2 million dollars. These monies were generated mainly from net
income ($.1 million), seasonal decreases in inventory ($1.1 million), decreases
in prepaids ($.2 million) offset by an increase in accounts receivable ($.3
million) and a decrease in accrued expenses ($.1 million). Cash provided from
operations was primarily used to reduce the long-term debt. Cash provided from
operations in the thirteen weeks ended July 30, 1995 totaled $1.4 million.
These funds were primarily used to reduce the long-term debt.
Investing Activity for the thirteen weeks ended July 28, 1996 and July 30, 1995
was $402,000 and $123,000, respectively. Funds were used primarily for
improvements to and equipment in the processing facility.
Financing Activity During the thirteen weeks ended July 28, 1996 Cattleman's
repaid $1.4 million of debt, net of borrowings.
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PART II. Other Information
CATTLEMAN'S, INC.
ITEM 1. LEGAL PROCEEDINGS
None material
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULT UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8 - K
None
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Quarterly Report on Form 10 - Q for the
thirteen weeks ended July 28, 1996 to be signed on its behalf by the
undersigned thereunto duly authorized.
CATTLEMAN's, INC.
DATE: September 13, 1996 David S. Rohtbart
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David S. Rohtbart
President and Chief Executive Officer
Matthew G. Martin
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Matthew G. Martin
Chief Operating and Financial Officer
