<PAGE> 1
================================================================================
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 PERIOD ENDED FEBRUARY 28, 1997
-----------------
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 33-68412
---------------
AVONDALE INCORPORATED
(Exact name of registrant as specified in its charter)
GEORGIA 58-0477150
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
506 SOUTH BROAD STREET 30655
MONROE, GEORGIA (Zip code)
(Address of principal executive offices)
Registrant's telephone number, including area code: (770) 267-2226
Former name, former address and former fiscal year, if changed since last
report: N/A
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
--- ---
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
<TABLE>
<CAPTION>
Description As Of Shares Outstanding
-------------------- ------------- ------------------
<S> <C> <C>
Class A Common Stock April 4, 1997 12,312,034 Shares
Class B Common Stock April 4, 1997 978,939 Shares
</TABLE>
================================================================================
<PAGE> 2
FORM 10-Q
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION (UNAUDITED)
<S> <C>
Condensed Consolidated Balance Sheets at February 28, 1997 and August 30, 1
Condensed Consolidated Statements of Income for the Thirteen Weeks Ended
February 28, 1997 and February 23, 1996 2
Condensed Consolidated Statements of Income for the Twenty-Six Weeks Ended
February 28, 1997 and February 23, 1996 3
Condensed Consolidated Statements of Cash Flows for the Twenty-Six Weeks Ended
February 28, 1997 and February 23, 1996 4
Notes to Condensed Consolidated Financial Statements 5
Management's Discussion and Analysis of Financial Condition and Results of Operations 7
PART II - OTHER INFORMATION
Item 1: Legal Proceedings 11
Item 2: Changes in Securities 11
Item 3: Defaults upon Senior Securities 11
Item 4: Submission of Matters to a Vote of Security Holders 11
Item 5: Other Information 11
Item 6: Exhibits and Reports on Form 8-K 11
Signature 12
</TABLE>
<PAGE> 3
PART I. FINANCIAL INFORMATION
AVONDALE INCORPORATED
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
AUG. 30, FEB. 28,
1996 1997
---------- ----------
ASSETS
<S> <C> <C>
Current assets
Cash $ 7,253 $ 4,112
Accounts receivable, less allowance for doubtful
accounts of $4,920 in 1996 and $5,607 in 1997 84,428 87,195
Due from Triarc 7,250 --
Inventories 127,698 135,590
Prepaid expenses 2,792 7,394
---------- ----------
Total current assets 229,421 234,291
Property, plant and equipment
Land 8,490 8,490
Buildings 64,275 65,189
Machinery and equipment 355,155 363,624
---------- ----------
427,920 437,303
Less accumulated depreciation (190,838) (210,736)
---------- ----------
237,082 226,567
Other assets 26,576 21,048
---------- ----------
$ 493,079 $ 481,906
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable $ 47,045 $ 48,372
Accrued compensation, benefits and related expenses 20,182 15,106
Other accrued expenses 26,530 23,729
Long-term debt due in one year 3,250 2,250
Income taxes payable 88 --
---------- ----------
Total current liabilities 97,095 89,457
Long-term debt 299,850 294,150
Deferred income taxes and other long-term liabilities 28,622 31,006
Shareholders' equity
Preferred Stock
$.01 par value; 10,000 shares authorized -- --
Common Stock
Class A, $.01 par value; 100,000 shares
authorized, 12,312 issued and outstanding 123 123
Class B, $.01 par value; 5,000 shares
authorized, 979 issued and outstanding 10 10
Capital in excess of par value 41,844 41,844
Retained earnings 25,535 25,316
---------- ----------
Total shareholders' equity 67,512 67,293
---------- ----------
$ 493,079 $ 481,906
========== ==========
</TABLE>
See notes to condensed consolidated financial statements.
1
<PAGE> 4
AVONDALE INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
THIRTEEN WEEKS ENDED
--------------------
FEB. 23, FEB. 28,
1996 1997
--------- ----------
<S> <C> <C>
Net sales $ 114,547 $ 247,630
Operating costs and expenses
Cost of goods sold 96,605 215,228
Depreciation 6,379 10,282
Selling and administrative expenses 6,567 11,146
--------- ---------
Operating income 4,996 10,974
Interest expense 3,028 6,915
Discount and expenses on sale of receivables -- 1,625
Loss attributable to investment in Oneita -- 1,466
Other (income) expense, net (70) 171
--------- ---------
Income before income taxes 2,038 797
Provision for income taxes 795 326
--------- ---------
Net income $ 1,243 $ 471
========= =========
Per share data:
Net income $ .11 $ .04
========= =========
Dividends declared $ .07 $ .07
========= =========
Weighted average shares outstanding 11,069 13,400
========= =========
</TABLE>
See notes to condensed consolidated financial statements.
2
<PAGE> 5
AVONDALE INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
TWENTY-SIX WEEKS ENDED
----------------------
FEB. 23, FEB. 28,
1996 1997
---------- ----------
<S> <C> <C>
Net sales $ 243,496 $ 501,694
Operating costs and expenses
Cost of goods sold 205,565 433,531
Depreciation 12,607 20,561
Selling and administrative expenses 13,292 22,616
---------- ----------
Operating income 12,032 24,986
Interest expense 6,036 13,413
Discount and expenses on sale of receivables -- 3,236
Loss attributable to investment in Oneita -- 5,156
Other (income) expense, net (540) 429
---------- ----------
Income before income taxes 6,536 2,752
Provision for income taxes 2,540 1,110
---------- ----------
Net income $ 3,996 $ 1,642
========== ==========
Per share data:
Net income $ .36 $ .12
========== ==========
Dividends declared $ .14 $ .14
========== ==========
Weighted average shares outstanding 11,133 13,400
========== ==========
</TABLE>
See notes to condensed consolidated financial statements
3
<PAGE> 6
AVONDALE INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
TWENTY-SIX WEEKS ENDED
----------------------
FEB. 23, FEB. 28,
1996 1997
-------- --------
<S> <C> <C>
Operating activities
Net income $ 3,996 $ 1,642
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 12,629 20,586
Loss attributable to investment in Oneita -- 5,156
Provision for deferred income taxes 142 2,384
Interest expense on payment-in-kind notes 1,229 --
Gain on sale of equipment (639) (41)
Changes in operating assets and liabilities (18,447) (14,774)
-------- --------
Net cash provided by operating activities (1,090) 14,953
Investing activities
Purchases of property, plant and equipment (13,275) (9,599)
Proceeds from sale of property, plant and equipment 640 66
-------- --------
Net cash used in investing activities (12,635) (9,533)
Financing activities
Net additions to (payments on) revolving line of credit and long-term debt 16,825 (6,700)
Dividends paid (1,550) (1,861)
-------- --------
Net cash provided by (used in) financing activities 15,275 (8,561)
-------- --------
Increase (decrease) in cash 1,550 (3,141)
Cash at beginning of period 1,335 7,253
-------- --------
Cash at end of period $ 2,885 $ 4,112
======== ========
</TABLE>
See notes to condensed consolidated financial statements.
4
<PAGE> 7
AVONDALE INCORPORATED
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
FEBRUARY 28, 1997
1. Basis of Presentation: The accompanying unaudited condensed
consolidated financial statements include the accounts of Avondale Incorporated
and its wholly owned subsidiaries, Avondale Mills, Inc. and Avondale
Receivables Company (collectively, the "Company"). These statements have been
prepared in accordance with generally accepted accounting principles for
interim financial information. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. The August 30, 1996 balance sheet has been
derived from the audited financial statements at that date. Certain prior year
balances have been reclassified to conform to the current year's presentation.
The accounting policies and basis of presentation followed by the Company are
presented in Note 1 to the August 30, 1996 Audited Consolidated Financial
Statements.
Effective September 1, 1996, the Company adopted Statement of Financial
Accounting Standards No. 121 "Accounting for the Impairment of Long-lived
Assets and Long-Lived Assets to be Disposed Of." The adoption of this statement
had no impact on the Company's financial results.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
In the opinion of management, the accompanying unaudited condensed
consolidated financial statements contain all adjustments (consisting of normal
recurring accruals) necessary for a fair presentation. Operating results for
the thirteen weeks and twenty-six weeks ended February 28, 1997 are not
necessarily indicative of the results that may be expected for the fiscal year
ending August 29, 1997.
2. Inventories: Components of inventories are as follows (amounts in
thousands):
<TABLE>
<CAPTION>
AUG. 30, FEB. 28,
1996 1997
-------- --------
<S> <C> <C>
Finished goods $ 35,746 $ 39,910
Work in process 56,826 57,241
Raw materials 28,812 31,715
Dyes and chemicals 6,353 5,411
-------- --------
Inventories at FIFO 127,737 134,277
Less allowance to reduce carrying value to
LIFO basis (7,725) (6,925)
-------- --------
120,012 127,352
Supplies at average cost 7,686 8,238
-------- --------
$127,698 $135,590
======== ========
</TABLE>
5
<PAGE> 8
AVONDALE INCORPORATED
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONT.)
(UNAUDITED)
FEBRUARY 28, 1997
Valuation of the Company's inventories under the last-in, first-out (LIFO)
method at February 28, 1997 and the related impact on the statement of income
for the thirteen weeks and twenty-six weeks then ended has been determined
using estimated quantities and costs as of the fiscal 1997 year-end. As a
result, interim amounts are subject to the final year-end LIFO valuation.
3. Investment in securities: In January 1996, the Company purchased a
$7.5 million subordinated note due February 26, 1999, having convertible
features, from Oneita Industries, Inc. ("Oneita"). On August 27, 1996, the
Company converted the subordinated note plus accrued interest into 2,270,833
shares of common stock of Oneita, representing ownership of 24.8% of Oneita's
outstanding shares. This investment, which is accounted for under the equity
method, is included in Other assets in the Consolidated Balance Sheet.
The following summarizes the results of operations reported by Oneita for
its two fiscal quarters ended December 28, 1996 (amounts in thousands):
<TABLE>
<CAPTION>
Two Fiscal Quarters Ended
December 28, 1996
-------------------------
<S> <C>
Net Sales $ 68,608
=========
Loss from Operations $ (20,645)
=========
Net Loss $ (24,738)
=========
</TABLE>
During the thirteen weeks and twenty-six weeks ended February 28, 1997,
the Company recorded a loss of approximately $1.5 and $5.2 million,
respectively, attributable to its investment in Oneita. Such loss represented
the Company's pro rata share of the net loss incurred by Oneita for its two
fiscal quarters noted above.
4. Contingencies: The Company is involved in certain environmental
matters and claims. The Company has provided reserves to cover management's
estimates of the cost of investigating, monitoring and remediating these and
other environmental conditions. If more costly remediation measures are
necessary than those believed to be probable based on current facts and
circumstances, actual costs may exceed the reserves provided. However, based on
the information currently available, management does not believe that the
outcome of these matters will have a material adverse effect on its future
results of operations or financial position.
The Company is also a party to litigation incidental to its business from
time to time. The Company is not currently a party to any litigation that
management, in consultation with legal counsel, believes, if determined
adversely to the Company, would have a material adverse effect on the Company's
financial condition or results of operations.
6
<PAGE> 9
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Thirteen Weeks Ended February 28, 1997 Compared to Thirteen Weeks Ended
February 23, 1996
NET SALES. Net sales increased 116.2% to $247.6 million for the thirteen
weeks ended February 28, 1997 from $114.5 million for the thirteen weeks ended
February 23, 1996, primarily as a result of the Company's acquisition of
substantially all of the textile assets of Graniteville Company
("Graniteville") in April 1996.
Apparel fabric sales increased 251.8% to $167.7 million for the thirteen
weeks ended February 28, 1997 from $47.7 million for the thirteen weeks ended
February 23, 1996. This increase in sales reflected a 293.4% increase in yards
sold, which was partially offset by a 10.6% decline in average selling prices.
The increase in yards sold was primarily attributable to the acquisition of
Graniteville in April 1996. The decline in average selling prices resulted from
the inclusion of net sales attributable to Graniteville, which generally were
at lower average selling prices than the Company's other apparel fabric sales,
and softening market prices for certain denim fabrics caused by excess
inventories of denim fabric and garments within the industry, as well as
increased production capacity of domestic and Mexican suppliers.
Greige and specialty fabric sales increased 70.1% to $17.4 million for the
thirteen weeks ended February 28, 1997 from $10.2 million for the thirteen
weeks ended February 23, 1996. This increase in sales was primarily the result
of an increase in yards sold due to the inclusion of net sales attributable to
Graniteville, which was acquired in April 1996.
Yarn sales increased 10.3% to $62.5 million for the thirteen weeks ended
February 28, 1997 from $56.6 million for the thirteen weeks ended February 23,
1996. This increase reflected a 12.8% increase in pounds sold and a 2.2%
decrease in average selling prices. These fluctuations reflected a more
aggressive marketing strategy aimed at improving capacity utilization and
reducing unit conversion costs. Market prices remained very competitive,
reflecting continued excess production capacity within the yarn industry during
the thirteen weeks ended February 28, 1997.
COST OF GOODS SOLD. Cost of goods sold increased 122.8% to $215.2 million
for the thirteen weeks ended February 28, 1997 from $96.6 million for the
thirteen weeks ended February 23, 1996. Cost of goods sold as a percentage of
net sales increased to 86.9% for the thirteen weeks ended February 28, 1997
from 84.3% for the thirteen weeks ended February 23, 1996, primarily due to
higher production costs of certain Graniteville products and the impact of
lower average selling prices. Raw material costs as a percentage of net sales
decreased to 46.9% for the thirteen weeks ended February 28, 1997 from 50.0%
for the thirteen weeks ended February 23, 1996, while conversion costs as a
percentage of net sales increased to 40.1% for the thirteen weeks ended
February 28, 1997 from 34.4% for the thirteen weeks ended February 23, 1996.
SELLING AND ADMINISTRATIVE EXPENSES. Selling and administrative expenses
increased 69.7% to $11.1 million for the thirteen weeks ended February 28, 1997
from $6.6 million for the thirteen weeks ended February 23, 1996, primarily due
to additional expenses attributable to Graniteville. Selling and administrative
expenses as a percentage of net sales decreased to 4.5% for the thirteen weeks
ended February 28, 1997 from 5.7% for the thirteen weeks ended February 23,
1996.
INTEREST EXPENSE, NET. Interest expense, net increased 128.4% to $6.9
million for the thirteen weeks ended February 28, 1997 from $3.0 million for
the thirteen weeks ended February 23, 1996. This increase reflected a higher
average of outstanding borrowings during the thirteen weeks ended February 28,
1997 as a result of borrowings incurred to finance the acquisition of
Graniteville.
7
<PAGE> 10
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONT.)
RESULTS OF OPERATIONS (CONT.)
DISCOUNT AND EXPENSES ON SALE OF RECEIVABLES. Discount and expenses on
sale of receivables were $1.6 million for the thirteen weeks ended February 28,
1997, which related to the receivables securitization facility established by
the Company in April 1996.
LOSS ATTRIBUTABLE TO INVESTMENT IN ONEITA. During the thirteen weeks
ended February 28, 1997 the Company recorded a loss of approximately $1.5
million attributable to its investment in Oneita. Such loss represented the
Company's pro rata share of the net loss incurred by Oneita for its fiscal
quarter ended December 28, 1996. The carrying value of this investment at
February 28, 1997 was less than the aggregate market value of such investment
based upon the last reported close price of Oneita's common stock as reported
on the New York Stock Exchange as of February 28, 1997.
PROVISION FOR INCOME TAXES. Provision for income taxes decreased 59.0% to
$0.3 million for the thirteen weeks ended February 28, 1997 from $0.8 million
for the thirteen weeks ended February 23, 1996. The Company's effective tax
rate was 40.1% for the thirteen weeks ended February 28, 1997 compared to 39.0%
for the thirteen weeks ended February 23, 1996.
Twenty-Six Weeks Ended February 28, 1997 Compared to Twenty-Six Weeks Ended
February 23, 1996
NET SALES. Net sales increased 106.0% to $501.7 million for the
twenty-six weeks ended February 28, 1997 from $243.5 million for the twenty-six
weeks ended February 23, 1996, primarily as a result of the Company's
acquisition of substantially all of the textile assets of Graniteville.
Apparel fabric sales increased 248.3% to $346.3 million for the twenty-six
weeks ended February 28, 1997 from $99.4 million for the twenty-six weeks ended
February 23, 1996. This increase in sales reflected a 291.4% increase in yards
sold, which was partially offset by a 11.0% decline in average selling prices.
The increase in yards sold was primarily attributable to the acquisition of
Graniteville in April 1996. The decline in average selling prices resulted from
the inclusion of net sales attributable to Graniteville, which generally were
at lower average selling prices than the Company's other apparel fabric sales,
and softening market prices for certain denim fabrics caused by excess
inventories of denim fabric and garments within the industry, as well as
increased production capacity of domestic and Mexican suppliers.
Greige and specialty fabric sales increased 50.1% to $32.5 million for the
twenty-six weeks ended February 28, 1997 from $21.6 million for the twenty-six
weeks ended February 23, 1996. This increase in sales was primarily the result
of an increase in yards sold due to the inclusion of net sales attributable to
Graniteville, which was acquired in April 1996.
Yarn sales increased 0.4% to $122.9 million for the twenty-six weeks ended
February 28, 1997 from $122.4 million for the twenty-six weeks ended February
23, 1996. This increase reflected a 4.2% increase in pounds sold and a 3.7%
decrease in average selling prices. These fluctuations reflected a more
aggressive marketing strategy aimed at improving capacity utilization and
reducing unit conversion costs. Market prices remained very competitive,
reflecting continued excess production capacity within the yarn industry during
the twenty-six weeks ended February 28, 1997.
COST OF GOODS SOLD. Cost of goods sold increased 110.9% to $433.5 million
for the twenty-six weeks ended February 28, 1997 from $205.6 million for the
twenty-six weeks ended February 23, 1996. Cost of goods sold as a percentage of
net sales increased to 86.4% for the twenty-six weeks ended February 28, 1997
from 84.4% for the twenty-six weeks ended February 23, 1996, primarily due to
higher production costs of certain Graniteville
8
<PAGE> 11
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONT.)
RESULTS OF OPERATIONS (CONT.)
products and the impact of lower average selling prices. Raw material costs as
a percentage of net sales decreased to 48.5% for the twenty-six weeks ended
February 28, 1997 from 51.1% for the twenty-six weeks ended February 23, 1996,
while conversion costs as a percentage of net sales increased to 38.0% for the
twenty-six weeks ended February 28, 1997 from 33.3% for the twenty-six weeks
ended February 23, 1996.
SELLING AND ADMINISTRATIVE EXPENSES. Selling and administrative expenses
increased 70.1% to $22.6 million for the twenty-six weeks ended February 28,
1997 from $13.3 million for the twenty-six weeks ended February 23, 1996,
primarily due to additional expenses attributable to Graniteville. Selling and
administrative expenses as a percentage of net sales decreased to 4.5% for the
twenty-six weeks ended February 28, 1997 from 5.5% for the twenty-six weeks
ended February 23, 1996.
INTEREST EXPENSE, NET. Interest expense, net increased 122.2% to $13.4
million for the twenty-six weeks ended February 28, 1997 from $6.0 million for
the twenty-six weeks ended February 23, 1996. This increase reflected a higher
average of outstanding borrowings during the twenty-six weeks ended February
28, 1997 as a result of borrowings incurred to finance the acquisition of
Graniteville.
DISCOUNT AND EXPENSES ON SALE OF RECEIVABLES. Discount and expenses on
sale of receivables were $3.2 million for the twenty-six weeks ended February
28, 1997, which related to the receivables securitization facility established
by the Company in April 1996.
LOSS ATTRIBUTABLE TO INVESTMENT IN ONEITA. During the twenty-six weeks
ended February 28, 1997 the Company recorded a loss of approximately $5.2
million attributable to its investment in Oneita. Such loss represented the
Company's pro rata share of the net loss incurred by Oneita for its two fiscal
quarters ended December 28, 1996. The carrying value of this investment at
February 28, 1997 was less than the aggregate market value of such investment
based upon the last reported close price of Oneita's common stock as reported
on the New York Stock Exchange as of February 28, 1997.
PROVISION FOR INCOME TAXES. Provision for income taxes decreased 56.3% to
$1.1 million for the twenty-six weeks ended February 28, 1997 from $2.5 million
for the twenty-six weeks ended February 23, 1996. The Company's effective tax
rate was 40.3% for the twenty-six weeks ended February 28, 1997 compared to
38.9% for the twenty-six weeks ended February 23, 1996.
LIQUIDITY AND CAPITAL RESOURCES
Net cash provided by operating activities was $15.0 million for the
twenty-six weeks ended February 28, 1997. Principal working capital changes
included a $2.8 million increase in Accounts Receivable, a $7.9 million
increase in Inventories, and a $6.6 million decrease in Accounts Payable and
Accrued Expenses. The Company's investing activities included $9.6 million in
capital improvements relating to the ongoing modernization of the Company's
manufacturing facilities. Net cash used in financing activities aggregated $8.6
million, including $6.7 million to repay debt and $1.9 million to pay dividends
on outstanding capital stock.
At February 28, 1997, the Company had borrowings of $156.4 million
outstanding under its revolving line of credit and $68.6 million of borrowing
availability thereunder.
The Company's capital expenditures aggregated $9.6 million for the
twenty-six weeks ended February 28, 1997. These expenditures were primarily for
the expansion of the Company's denim manufacturing operations and other
equipment purchases. Management estimates that capital expenditures for the
balance of fiscal 1997 will be
9
<PAGE> 12
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONT.)
RESULTS OF OPERATIONS (CONT.)
approximately $30.0 million, and that such amounts will be used primarily to
upgrade weaving equipment and to improve fabric finishing facilities.
Management believes that cash generated from operations, together with
borrowings available under its revolving line of credit and proceeds received
in connection with sales of trade receivables, will be sufficient to meet the
Company's working capital and capital expenditure needs in the foreseeable
future. The Company will also continue to consider other options available to
it in connection with future working capital and capital expenditure needs,
including the issuance of additional debt and equity securities.
10
<PAGE> 13
AVONDALE INCORPORATED
<TABLE>
<CAPTION>
PART II - OTHER INFORMATION
<S> <C>
Item 1 Legal Proceedings
None
Item 2 Changes in Securities
None
Item 3 Defaults upon Senior Securities
None
Item 4 Submission of Matters to a Vote of Security Holders
None
Item 5 Other Information
None
Item 6 Exhibits and Reports on Form 8-K
(a) Exhibits
27. Financial Data Schedule
(b) Reports on Form 8-K
None
</TABLE>
11
<PAGE> 14
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.
AVONDALE INCORPORATED
By: /s/ G. STEPHEN FELKER
------------------------------------------------
G. Stephen Felker
Chairman, President, and Chief Executive Officer
By: /s/ JACK R. ALTHERR, JR.
------------------------------------------------
Jack R. Altherr, Jr.
Vice Chairman and Chief Financial Officer
Date: April 11, 1997
--------------
12
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS FOR THE QUARTER ENDED FEBRUARY 28, 1997 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> AUG-29-1997
<PERIOD-END> FEB-28-1997
<CASH> 4,112
<SECURITIES> 0
<RECEIVABLES> 87,195
<ALLOWANCES> 5,607
<INVENTORY> 135,590
<CURRENT-ASSETS> 234,291
<PP&E> 437,303
<DEPRECIATION> 210,736
<TOTAL-ASSETS> 481,906
<CURRENT-LIABILITIES> 89,457
<BONDS> 294,150
0
0
<COMMON> 133
<OTHER-SE> 67,160
<TOTAL-LIABILITY-AND-EQUITY> 481,906
<SALES> 501,694
<TOTAL-REVENUES> 501,694
<CGS> 433,531
<TOTAL-COSTS> 476,708
<OTHER-EXPENSES> 8,821
<LOSS-PROVISION> 607
<INTEREST-EXPENSE> 13,413
<INCOME-PRETAX> 2,752
<INCOME-TAX> 1,110
<INCOME-CONTINUING> 1,642
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,642
<EPS-PRIMARY> .12
<EPS-DILUTED> .12
</TABLE>