<PAGE> EXHIBIT INDEX ON PAGE 3
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 14, 1996
CARSON PIRIE SCOTT & CO.
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(Exact name of registrant as specified in its charter)
Illinois
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(State or other jurisdiction of incorporation)
0-22682 37-0175980
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Commission File Number (IRS Employer Identification No.)
331 West Wisconsin Avenue, Milwaukee, Wisconsin 53203
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(Address of principal executive offices) (Zip Code)
(414) 347-4141
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Registrant's Telephone Number
Page 1
Item 5. Other Events.
On November 14, 1996, Carson Pirie Scott & Co. reported its
earnings for the third quarter in a news release, a copy of which
is attached as Exhibit 1.
Item 7. Exhibits.
See Exhibit Index on page 3 of this Current Report on Form 8-K.
SIGNATURE
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.
Dated November 19, 1996.
CARSON PIRIE SCOTT & CO.
By: /s/ Charles J. Hansen
------------------------
Charles J. Hansen
Vice President,
General Counsel,
and Secretary
Page 2
EXHIBIT INDEX
1. News release, dated November 14, 1996.
Page 3
EXHIBIT 1
Investors Media
- ----------- -------
Darren R. Jackson Edward P. Carroll, Jr.
V.P.--Chief Financial Officer Executive V.P. Marketing
(414) 278-5787 (414) 347-5340
FOR IMMEDIATE RELEASE THURSDAY, November 14, 1996
CARSON PIRIE SCOTT & CO. THIRD QUARTER OPERATING
EARNINGS INCREASE 30% TO $0.31 PER SHARE
MILWAUKEE, WISCONSIN, NOVEMBER 14, 1996 - Carson Pirie Scott & Co. (NYSE:CRP),
today reported its third quarter financial results. Stanton J. Bluestone,
Chairman and Chief Executive Officer of Carson Pirie Scott & Co. commented:
"I am pleased to report our sixth consecutive quarter of improvement in
operating earnings per share. The 30% earnings improvement was driven by
strong sales results in our targeted merchandise categories, an 0.8 percentage
point improvement in gross margin rate and diligent operating expense control.
Our total sales increased 7.0% for the quarter; comparable store sales
increased 3.5% and our four new stores added 3.5%. Women's and Men's apparel,
Coats, Cosmetics and Furniture generated strong sales and margin results for
the quarter. In addition, we maintained our operating expense rate at 30.3%
of sales despite a $2.2 million charge related to our new store openings. A
50% reduction in bad debt expense and productivity gains throughout the
Company offset these incremental store preopening expenses."
"I am upbeat about our prospects for the upcoming holiday season. While I
recognize that a very competitive retail environment and five fewer holiday
shopping days will pose a challenge, I believe the exciting merchandise
offerings and marketing programs that we have in place for the upcoming
holiday season will help us overcome these factors. In addition, I believe
that our customers will reward us for the convenience of our locations during
this shorter holiday season."
1996 Third Quarter Results Summary
-----------------------------------------
($ in millions, Net Net
except EPS) Sales EBITDA Income EPS
- ----------------- ----- ------ ------ -----
OPERATING RESULTS(1) $266.2 $17.0 $5.2 $0.31
NON-RECURRING ITEM:
County Seat Write-Down - - (6.4) (0.38)
---------------------------------------------
TOTAL COMPANY $266.2 $17.0 ($1.2) ($0.07)
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---------------------------------------------
(1) Excludes non-recurring and one-time items.
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Page 4
1995 Third Quarter Results Summary
------------------------------------------
($ in millions, Net Net
except EPS) Sales EBITDA Income EPS
- ------------------ ----- ------ ------ -----
OPERATING RESULTS(1) $248.9 $13.9 $4.1 $0.24
NON-RECURRING ITEM:
County-Seat Write-Down - - - -
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TOTAL COMPANY $248.9 $13.9 $4.1 $0.24
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(1) Excludes non-recurring and one-time items.
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THIRD QUARTER RESULTS: Operating results exclude from Total Company results
the impact of non-recurring items. Sales increased 7.0% to $266.2 million in
the third quarter of 1996 from the prior year's sales of $248.9 million.
Sales increased 3.5% on a same-store basis. Operating earnings before
interest, taxes, depreciation, amortization and other non-cash items
("EBITDA") increased 22% to $17.0 million in 1996 from $13.9 million in 1995.
Excluding the impact of preopening expenses, EBITDA increased 38% to $19.2
million. Operating net income increased $1.1 million in the quarter versus
the prior year third quarter as a result of the improved EBITDA performance.
Operating earnings per share ("EPS") improved 30% from $0.24 to $0.31 per
share.
On a Total Company basis, the Company recorded a loss of $0.07 per share due
to a previously disclosed $0.38 per share write-down of the Company's interest
in 9% Junior Subordinated Debentures of County Seat, Inc. ("County Seat
Write-Down"). The Company received the debentures as part of the sale price
for the Company's 1989 divestiture of County Seat to a management led buyout
group.
1996 Year to Date Results Summary
------------------------------------------
($ in millions, Net Net
except EPS) Sales EBITDA Income EPS
- --------------------- ----- ------ ------ -----
OPERATING RESULTS(1) $728.0 $40.9 $10.4 $0.61
NON-RECURRING ITEMS:
Minnesota
clearance sales - - - -
Minnesota sale gain - - - -
Write-off of loan fees - - (0.2) (0.01)
Sale of Proffitt's stock - - 9.0 0.54
County Seat Write-Down - - (6.4) (0.38)
Charitable contribution - - (1.5) (0.09)
----------------------------------------------
TOTAL COMPANY $728.0 $40.9 $11.3 $0.67
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----------------------------------------------
(1) Excludes the results of the 8 stores sold to Mervyns in March 1995 and
non-recurring items.
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Page 5
1995 Year to Date Results Summary
--------------------------------------
($ in millions, Net Net
except EPS) Sales EBITDA Income EPS
- ------------------ ----- ------ ------ ---
OPERATING RESULTS(1) $694.0 $35.5 $8.1 $0.47
NON-RECURRING ITEMS:
Minnesota
clearance sales 25.0 - - -
Minnesota sale gain - - 33.0 1.90
Write-off of loan fees - - - -
Sale of Proffitt's stock - - - -
County Seat Write-Down - - - -
Charitable contribution - - - -
------------------------------------------------
TOTAL COMPANY $719.0 $35.5 $41.1 $2.37
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------------------------------------------------
(1) Excludes the results of the 8 stores sold to Mervyns in March 1995 and
non-recurring items.
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OPERATING RESULTS: Operating results exclude from Total Company results the
operations of the eight-store Minnesota Division sold to Mervyn's in March
1995 and non-recurring items. Operating sales increased 4.9% to $728.0
million in 1996 from the prior year's sales of $694.0 million. Sales
increased 2.6% on a same-store basis. Operating EBITDA increased 15% to
$40.9 million in 1996 from $35.5 million in 1995. Operating net income
increased 28% to $10.4 million in 1996 as a result of the improved EBITDA
performance. Operating EPS improved by 30% from $0.47 to $0.61 per share.
TOTAL COMPANY RESULTS: Total Company sales increased $9.0 million in 1996.
The sales increase was mitigated by the sale of the Minnesota division. The
Minnesota Division contributed $25.0 million in sales to the 1995 results that
were absent in 1996. These sales were clearance sales and did not generate
incremental EBITDA.
Total Company net income declined $29.8 million and EPS was lower by
$1.70 in 1996 compared to 1995. The decreases are a result of lower net
non-recurring gains in the 1996 nine month period compared to the
non-recurring gain recorded in the same period of last year. The 1995 period
included a net non-recurring after-tax gain of $33.0 million or $1.90 per
share from the sale of the Minnesota division.
SHARE REPURCHASE PROGRAM: During the third quarter, the Company
repurchased 150,000 shares of its common stock for $3.7 million. Year to
date, the Company has repurchased 466,100 shares, or 2.8% of outstanding
shares, for $11.1 million under a $20 million buyback program.
Carson Pirie Scott & Co., a major department store retailer, operates 53
traditional department stores and 4 furniture stores: 32 Carson Pirie Scott
stores in greater Chicago, Indiana and Minnesota; 13 Bergner's in central
Illinois, and 12 Boston Stores in Wisconsin.
Page 6
CARSON PIRIE SCOTT & CO. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
ASSETS November 2, 1996 October 28, 1995
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Current assets:
Cash and cash equivalents $ 20,103 $ 36,979
Receivables, net 237,364 219,262
Inventories 255,658 237,010
Other current assets 20,344 19,139
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Total current assets 533,469 512,390
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Property and equipment, net 167,677 136,735
Other assets 53,046 69,963
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$754,192 719,088
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LIABILITIES AND SHAREHOLDERS' EQUITY
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Current liabilities:
Current maturities of
long-term debt $ 2,809 $ 3,066
Accounts payable and
accrued liabilities 202,569 180,885
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Total current liabilities 205,378 183,951
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Other liabilities 43,924 50,724
Accounts receivable securitization 142,788 122,749
Long-term debt, less
current maturities 46,752 89,507
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Total liabilities 438,842 446,931
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Shareholders' equity:
Common stock 160 164
Paid-in capital and
unamortized stock compensation 161,855 148,583
Unrealized gain on
investments 93 4,872
Retained earnings 153,242 118,538
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Total shareholders' equity 315,350 272,157
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$754,192 719,088
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Balance Sheet Statistics:
Net Debt/Capitalization (1) 35.3% 39.6%
Net Debt/Capitalization (1) (excluding
A/R debt) 8.5% 17.0%
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(1) Net Debt = Long-term debt + A/R Securitization - Cash
Page 7
CARSON PIRIE SCOTT & CO. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
(dollars in thousands, except per-share amounts)
Three months ended
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November 2, 1996 October 28, 1995
-------------------------------------------------
Net sales $266,238 $248,853
Cost of sales (168,565) (159,563)
Selling, general and
administrative expense (78,504) (75,362)
Store preopening costs (2,157) -
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EBITDA 17,012 13,928
Depreciation and
amortization expense (4,057) (2,646)
Other (321) (220)
Non-recurring items - -
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Income from operations 12,634 11,062
Non-recurring items (10,525) -
Acquisition expense - -
Interest expense, net (4,072) (4,259)
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Income (loss) before income
taxes (1,963) 6,803
Income tax expense 774 (2,726)
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Net income(loss) ($1,189) $4,077
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Net income (loss) per share:
Operating earnings per
share $0.31 $0.24
Primary $0.07 $0.24
Fully diluted $0.07 $0.24
Shares Outstanding
(in 000's) 16,578 16,730
Statistics:
Same-store sales increase 3.5% 0.2%
Gross margin rate (r) 36.7% 35.9%
Gross margin rate (o) 36.7% 35.9%
Net SG&A rate (r) (30.3%) (30.3%)
Net SG&A rate (o) (30.3%) (30.3%)
EBITDA rate (r) 6.4% 5.6%
EBITDA rate (o) 6.4% 5.6%
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(r) Total Company rates as reported.
(o) Ongoing Operations rates which exclude the impact of eight stores sold
to Mervyn's in 1995 and non-recurring items.
Page 8
Nine months ended
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November 2, 1996 October 28, 1995
--------------------------------------------------
Net sales $727,992 $718,960
Cost of sales (463,770) (469,770)
Selling, general and
administrative expense (220,357) (213,691)
Store preopening costs (3,014) -
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EBITDA 40,851 35,499
Depreciation and
amortization expense (12,120) (8,815)
Other (456) (179)
Non-recurring items - 55,000
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Income from operations 28,275 81,505
Non-recurring items 1,540 -
Acquisition expense - -
Interest expense, net (11,207) (12,978)
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Income (loss) before income
taxes 18,608 68,527
Income tax expense (7,331) (27,413)
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Net income (loss) $11,277 $41,114
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Net income (loss) per share:
Operating earnings per
share $0.61 $0.47
Primary $0.67 $2.37
Fully diluted $0.67 $2.37
Shares Outstanding
(in 000's) 16,720 17,378
Statistics:
Same-store sales increase 2.6% 2.4%
Gross margin rate (r) 36.3% 34.7%
Gross margin rate (o) 36.3% 35.9%
Net SG&A rate (r) (30.7%) (29.7%)
Net SG&A rate (o) (30.7%) (30.8%)
EBITDA rate (r) 5.6% 4.9%
EBITDA rate (o) 5.6% 5.1%
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(r) Total Company rates as reported.
(o) Ongoing Operations rates which exclude the impact of eight stores sold
to Mervyn's in 1995 and non-recurring items.
Page 9
Trailing twelve months ended
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November 2, 1996 October 28, 1995
------------------------------------------------
Net sales $1,092,844 $1,111,865
Cost of sales (694,435) (723,970)
Selling, general and
administrative expense (302,067) (296,648)
Store preopening costs (3,337) (229)
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EBITDA 93,005 91,018
Depreciation and
amortization expense (14,697) (10,211)
Other (65) 866
Non-recurring items 904 71,171
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Income from operations 79,147 152,844
Non-recurring items 1,540 -
Acquisition expense (6,835) -
Interest expense, net (16,203) (17,806)
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Income before income taxes 57,649 135,038
Income tax expense (22,945) (54,019)
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Net income (loss) $34,704 $81,019
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Statistics:
Same-store sales increase 2.8% 3.3%
Gross margin rate (r) 36.5% 34.9%
Gross margin rate (o) 36.5% 35.7%
Net SG&A rate (r) (27.9%) (26.7%)
Net SG&A rate (o) (27.9%) (27.3%)
EBITDA rate (r) 8.5% 8.2%
EBITDA rate (o) 8.5% 8.4%
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(r) Total Company rates as reported.
(o) Ongoing Operations rates which exclude the impact of eight stores sold
to Mervyn's in 1995 and non-recurring items.
Page 10
