<PAGE>
UNITED STATES
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 quarterly period ended April 30, 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: 0-23214
---------
SAMSONITE CORPORATION
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 36-3511556
- ------------------------------- -------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
11200 East 45th Avenue, Denver, CO 80239
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(303) 373-2000
----------------------------------------------------
(Registrant's telephone number, including area code)
----------------------------------------------------
(Former name, 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 and (2) has been subject to such filing
requirements for the past 90 days.
X Yes No
--- ---
Indicate by check mark whether the registrant has filed all documents
and reports required to be filed by Section 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.
X Yes No
--- ---
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date. 20,352,003 shares of
common stock, par value $0.01 per share, as of June 1, 1997.
<PAGE>
FORM 10-Q
---------
CONTENTS
--------
<TABLE>
<CAPTION>
Page Number
-----------
PART I - FINANCIAL INFORMATION
---------------------
<S> <C>
Unaudited Consolidated Balance Sheets as of April 30, 1997
and January 31, 1997................................................. 1
Unaudited Consolidated Statements of Operations for the three months
ended April 30, 1997 and 1996........................................ 3
Unaudited Consolidated Statement of Stockholders' Equity
for the three months ended April 30, 1997............................ 4
Unaudited Consolidated Statements of Cash Flows for the three months
ended April 30, 1997 and 1996........................................ 5
Unaudited Notes to Consolidated Financial Statements................. 7
Management's Discussion and Analysis of Financial Condition
and Results of Operations............................................ 13
PART II - OTHER INFORMATION
-----------------
Item 1: Legal Proceedings........................................... 19
Item 2: Changes in Securities....................................... 19
Item 3: Defaults upon Senior Securities............................. 19
Item 4: Submission of Matters to a Vote of Security Holders......... 19
Item 5: Other Information........................................... 19
Item 6: Exhibits and Reports on Form 8-K............................ 19
Signature............................................................ 20
Index to Exhibits.................................................... 21
</TABLE>
<PAGE>
PART I - FINANCIAL INFORMATION
- ------------------------------
SAMSONITE CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE SHEETS
AS OF APRIL 30, 1997 AND JANUARY 31, 1997
(IN THOUSANDS)
<TABLE>
<CAPTION>
April 30, January 31,
Assets 1997 1997
- ------ ---------- -----------
<S> <C> <C>
Current assets:
Cash and cash equivalents....................................... $ 3,110 9,343
Trade receivables, net of allowances for doubtful accounts
of $8,170 and $7,431.......................................... 92,281 83,276
Notes and other receivables..................................... 7,889 9,045
Inventories (Note 2)............................................ 134,298 135,071
Deferred income tax assets...................................... 36,524 36,365
Prepaid expenses and other current assets....................... 15,675 13,012
Assets held for sale............................................ 8,932 9,002
--------- ----------
Total current assets...................................... 298,709 295,114
Investments in affiliates......................................... 2,927 2,989
Property, plant and equipment, net (Note 3)....................... 141,092 143,959
Intangible assets, less accumulated amortization of $39,564
and $37,822 (Note 4)............................................ 125,802 127,655
Other assets and long-term receivables, net of allowances
for doubtful accounts of $5,556................................. 20,874 22,941
--------- ----------
$ 589,404 592,658
========= ==========
(Continued)
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1
<PAGE>
SAMSONITE CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE SHEETS
AS OF APRIL 30, 1997 AND JANUARY 31, 1997
(IN THOUSANDS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
April 30, January 31,
Liabilities and Stockholders' Equity 1997 1997
- ------------------------------------ ---------- -----------
<S> <C> <C>
Current liabilities:
Short-term debt (Note 5)........................................ $ 1,355 2,095
Current installments of long-term obligations (Note 5).......... 11,899 22,862
Accounts payable................................................ 52,308 46,777
Accrued liabilities............................................. 94,473 117,985
--------- ----------
Total current liabilities............................... 160,035 189,719
Long-term obligations, less current installments (Note 5)......... 149,829 267,755
Deferred income tax liabilities................................... 28,870 30,921
Other noncurrent liabilities...................................... 71,858 75,125
--------- ----------
Total liabilities....................................... 410,592 563,520
--------- ----------
Minority interests in consolidated subsidiaries................... 5,044 4,140
Stockholders' equity (Notes 7 and 8):
Preferred stock ($.01 par value; 2,000,000 shares authorized;
no shares issued)............................................. -- --
Common stock ($.01 par value; 60,000,000 shares authorized;
20,351,079 and 16,033,833 shares issued and outstanding)...... 204 160
Additional paid-in capital...................................... 418,396 266,752
Accumulated deficit............................................. (234,004) (235,870)
Foreign currency translation adjustment......................... (10,258) (5,337)
Unearned compensation - restricted shares....................... (570) (707)
--------- ----------
Total stockholders' equity.............................. 173,768 24,998
--------- ----------
Commitments and contingencies (Note 1C)
$ 589,404 592,658
========= ==========
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
2
<PAGE>
SAMSONITE CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED APRIL 30, 1997 AND 1996
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Three Months Ended April 30,
------------------------------
1997 1996
---- ----
<S> <C> <C>
Net sales (Note 1F).................................................. $169,562 169,867
Cost of goods sold................................................... 99,293 101,202
------- -------
Gross profit....................................................... 70,269 68,665
Selling, general and administrative expenses (Note 1G)............... 54,056 53,405
Amortization of intangible assets (Note 4)........................... 1,824 15,998
------- -------
Operating income (loss)............................................ 14,389 (738)
Other income (expense):
Interest income.................................................... 465 542
Interest expense and amortization of debt issue costs.............. (6,207) (9,110)
Other - net (Note 6)............................................... 6,899 1,792
------- -------
Income (loss) before income taxes, minority interest,
and extraordinary item........................................... 15,546 (7,514)
Income tax expense................................................... (6,829) (2,997)
Minority interest in earnings of subsidiaries........................ (218) (291)
------- -------
Income (loss) before extraordinary item............................ 8,499 (10,802)
Extraordinary item - loss on extinguishment of debt,
net of income tax benefit of $4,609 (Note 5)....................... (6,633) --
------- -------
Net income (loss).................................................. $ 1,866 (10,802)
======= =======
Net income (loss) per share - primary and fully diluted (Note 1E):
Income (loss) before extraordinary item.......................... $ .41 (.68)
Extraordinary loss............................................... (.32) --
------- -------
Net income (loss).............................................. $ .09 (.68)
======= =======
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
3
<PAGE>
SAMSONITE CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE THREE MONTHS ENDED APRIL 30, 1997
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
<TABLE>
<CAPTION>
FOREIGN UNEARNED
ADDITIONAL CURRENCY COMPENSATION-
PREFERRED COMMON PAID-IN ACCUMULATED TRANSLATION RESTRICTED
STOCK STOCK CAPITAL DEFICIT ADJUSTMENT SHARES
--------- ------ ---------- ------------ ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
Balance, February 1, 1997 $ -- 160 266,752 (235,870) (5,337) (707)
Issuance of 3,300,000
shares of common stock in
public offering, net of
offering costs and
underwriting discount of
$8,303 -- 33 130,264 -- -- --
Issuance of 889 shares to
directors for services -- -- 44 -- -- --
Amortization of restricted
stock award to
compensation expense -- -- -- -- -- 137
Compensation expense
accrued for stock bonus
awards -- -- 177 -- -- --
Exercise of employee stock
options and related income
tax benefits, net of shares
exchanged -- 11 21,159 -- -- --
Foreign currency
translation adjustment -- -- -- -- (4,921) --
Net income -- -- -- 1,866 -- --
--------- ------ ---------- ------------ ------------ -------------
Balance, April 30, 1997 $ -- 204 418,396 (234,004) (10,258) (570)
========= ====== ========== ============ ============ =============
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
4
<PAGE>
SAMSONITE CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED APRIL 30, 1997 AND 1996
(IN THOUSANDS)
<TABLE>
<CAPTION>
Three Months Ended April 30,
------------------------------
1997 1996
---- ----
<S> <C> <C>
Cash flows provided by (used in) operating activities:
Net income (loss)................................................ $ 1,866 (10,802)
Adjustments to reconcile net income (loss) to net cash provided by
(used in) operating activities:
Loss on extinguishment of debt................................. 6,633 --
Loss (gain) on disposition of fixed assets..................... 8 (14)
Depreciation and amortization of property,
plant and equipment.......................................... 5,384 5,170
Amortization of intangible assets.............................. 1,824 15,998
Amortization of debt issue costs............................... 468 483
Provision for doubtful accounts................................ 1,052 676
Amortization of stock awards and stock issued for services..... 358 --
Adjustment of allowances for previous operations............... (1,458) --
Adjustment to restructuring reserve............................ (600) --
Changes in operating assets and liabilities:
Trade and other receivables.................................. (8,618) (13,293)
Inventories.................................................. 773 (7,696)
Prepaid expenses and other current assets.................... (2,593) (637)
Accounts payable............................................. 5,531 6,086
Accrued liabilities.......................................... (4,196) (2,621)
Other adjustments - net........................................ (2,352) 2,701
------- -------
Net cash provided by (used in) operating activities.............. 4,080 (3,949)
------- -------
(Continued)
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
5
<PAGE>
SAMSONITE CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED APRIL 30, 1997 AND 1996
(IN THOUSANDS)
<TABLE>
<CAPTION>
Three Months Ended April 30,
----------------------------
1997 1996
---- ----
Cash flows provided by (used in) investing activities:
<S> <C> <C>
Purchases of property, plant and equipment..................... $ (8,002) (6,259)
Net cash received from (used in) previous operations........... (1,350) 7,176
Proceeds received from sales of property, plant and equipment.. 305 144
------- -------
Net cash provided by (used in) investing activities......... (9,047) 1,061
------- -------
Cash flows provided by (used in) financing activities:
Proceeds from public stock offering, net of offering costs..... 130,297 --
Proceeds from exercise of employee stock options............... 7,258 --
Retirement of subordinated notes............................... (80,800) --
Redemption premium on retirement of subordinated notes......... (8,684) --
Net payments of short-term debt................................ (580) (2,262)
Net payments on long-term bank borrowings...................... (44,611) (5,716)
Other, net..................................................... 1,101 1,016
------- -------
Net cash provided by (used in) financing activities......... 3,981 (6,962)
------- -------
Effect of exchange rate changes on cash and cash equivalents... (5,247) (847)
------- -------
Net decrease in cash and cash equivalents................... (6,233) (10,697)
Cash and cash equivalents, beginning of period................... 9,343 15,179
------- -------
Cash and cash equivalents, end of period......................... $ 3,110 4,482
======= =======
Supplemental disclosures of cash flow information:
Cash paid during the period for interest....................... $ 2,851 2,136
======= =======
Cash paid during the period for income taxes, net.............. $ 1,132 3,732
======= =======
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
6
<PAGE>
SAMSONITE CORPORATION AND SUBSIDIARIES
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. GENERAL
A. BUSINESS
--------
Samsonite Corporation and subsidiaries (the "Company") was formerly known as
Astrum International Corp. ("Astrum"). On July 14, 1995, Astrum merged with
its wholly-owned subsidiary, Samsonite Corporation, and changed its name to
Samsonite Corporation. The Company is engaged in the manufacture and sale
of luggage and related products throughout the world, primarily under the
Samsonite, American Tourister, and Lark brand names. The principal
customers of the Company are department/specialty retail stores, mass
merchants, catalog showrooms and warehouse clubs. The Company also sells
its luggage and other travel related products through its Company-owned
stores.
B. BASIS OF PRESENTATION
---------------------
On May 25, 1993, the United States Bankruptcy Court for the Southern
District of New York confirmed the Amended Plan of Reorganization (the
"Plan") for Astrum. Pursuant to the terms of the Plan, which became
effective on June 8, 1993, Astrum completed a comprehensive financial
reorganization which reduced debt and annual interest expense (the
"Restructuring").
The Restructuring has been accounted for pursuant to the American Institute
of Certified Public Accountants Statement of Position 90-7, entitled
"Financial Reporting by Entities in Reorganization Under the Bankruptcy
Code" ("SOP 90-7"). SOP 90-7 requires that assets and liabilities be
adjusted to their fair values ("fresh-start" values) and that a new
reporting entity be created. On June 30, 1993, for accounting purposes, the
Plan was consummated and SOP 90-7 was adopted. The consolidated financial
statements include the ongoing effects of fresh-start reporting. The most
significant fresh start adjustment relates to recording Reorganization Value
in Excess of Identifiable Assets. In addition, the Company recorded fresh
start adjustments to reflect tradenames, licenses, patents and other
intangibles at their fair values.
C. INTERIM FINANCIAL STATEMENTS
----------------------------
The accompanying unaudited consolidated financial statements reflect all
adjustments, which are normal and recurring in nature, and which, in the
opinion of management, are necessary to a fair statement of the financial
position as of April 30, 1997 and results of operations for the three months
ended April 30, 1997 and 1996. These consolidated financial statements and
related notes should be read in conjunction with the consolidated financial
statements and related notes included in the Company's Annual Report on Form
10-K for the fiscal year ended January 31, 1997.
See Note 13 to the aforementioned consolidated financial statements included
in the 1997 Form 10-K for a description of litigation, commitments and
contingencies.
D. USE OF ESTIMATES
----------------
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 amount of revenues and expenses during the
reporting period. Actual results could differ significantly from those
estimates.
7
<PAGE>
SAMSONITE CORPORATION AND SUBSIDIARIES
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
E. PER SHARE DATA
--------------
Income per share for the three months ended April 30, 1997 is calculated by
dividing income by the weighted average number of shares (19,848,865)
adjusted for the potentially dilutive effect of stock options and awards of
841,445 shares. Primary and fully diluted amounts were the same for the
three months ended April 30, 1997. Loss per share for the three months ended
April 30, 1996 was calculated based on the weighted average number of shares
outstanding of 15,889,450. Because of the loss, the effect of stock options
and awards is antidultive.
Effective for interim and annual periods ending after December 15, 1997,
earnings per share will be computed in accordance with the provisions of
Statement of Financial Accounting Standards No. 128, Earnings per Share
("SFAS 128"). SFAS 128 requires the reporting of "basic" earnings per
share and "diluted" earnings per share. Basic earnings per share is computed
by dividing income available to common stockholders by the weighted average
number of common shares outstanding. Diluted earnings per share is computed
by dividing income available to common stockholders by the weighted average
number of shares outstanding increased for potentially dilutive common
shares outstanding during the period. The dilutive effect of options,
warrants, and their equivalents is calculated using the treasury stock
method.
Following is a reconciliation of pro forma basic and diluted earnings per
share for the three months ended April 30, 1997 as if the provisions of SFAS
128 were effective for such period:
<TABLE>
<CAPTION>
Pro Forma
Basic Earnings per Share Income Shares Per Share Amount
- ------------------------ ------ ------ ----------------
<S> <C> <C> <C>
Income before extraordinary item $8,499,000 19,848,865 $.43
===
Added dilutive effect of stock options and awards 841,445
Earnings per Share-Assuming Dilution
- ------------------------------------ ---------- ----------
Income before extraordinary item available to
common stockholders and shares including
assumed conversions $8,499,000 20,690,310 $.41
========= ========== ===
</TABLE>
F. ROYALTY REVENUES
----------------
The Company licenses its brand names to certain unrelated third parties as
well as certain foreign subsidiaries and joint ventures. Net sales include
royalties earned of $4,763,000 and $8,329,000 for the three months ended
April 30, 1997 and 1996, respectively. Included in royalties for the three
months ended April 30, 1996 is $4.0 million from the sale of apparel
tradename licenses in certain Asian countries.
G. RESTRUCTURING RESERVES
----------------------
During the three months ended April 30, 1997, the Company had charges for
cash expenditures of approximately $900,000 against its restructuring
reserves. Also, a $600,000 reversal of excess restructuring reserves was
recorded in selling, general and administrative expenses. See Note 3 to the
consolidated financial statements in the 1997 Form 10-K for a description of
the reserves.
8
<PAGE>
SAMSONITE CORPORATION AND SUBSIDIARIES
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
2. INVENTORIES
Inventories consisted of the following :
April 30, January 31,
1997 1997
--------- -----------
(In thousands)
Raw Materials............................... $ 36,013 38,532
Work in Process............................. 11,691 10,842
Finished Goods.............................. 86,594 85,697
--------- ---------
$ 134,298 135,071
========= =========
3. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment consisted of the following:
April 30, January 31,
1997 1997
--------- -----------
(In thousands)
Land........................................ $ 12,771 13,324
Buildings................................... 59,122 62,561
Machinery, equipment and other.............. 124,461 121,875
--------- ---------
196,354 197,760
Less accumulated amortization and
depreciation............................... (55,262) (53,801)
--------- ---------
$ 141,092 143,959
========= =========
Depreciation included in cost of goods sold and selling, general and
administrative expenses related to adjustments of assets and liabilities to
fair value in connection with the adoption of SOP 90-7 consisted of the
following (in thousands):
Three months ended April 30,
----------------------------
1997 1996
---- ----
(In thousands)
"Fresh Start" Depreciation in Cost
of Goods Sold............................ $685 737
"Fresh Start" Depreciation in Selling
General and Administrative Expenses...... 151 163
---- ----
Total "Fresh Start" Depreciation........ $836 900
==== ====
Property and equipment revalued in connection with the adoption of SOP 90-7
are being depreciated over their respective estimated useful lives,
primarily ranging from two to six years.
4. INTANGIBLE ASSETS
Intanngible assets, net of accumulated amortization, consisted of the
following:
April 30, January 31,
1997 1997
--------- -----------
(In thousands)
Trademarks...................................... $ 114,910 115,838
Licenses, Patents and Other..................... 10,892 11,817
--------- ---------
$ 125,802 127,655
========= =========
9
<PAGE>
SAMSONITE CORPORATION AND SUBSIDIARIES
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
Amortization of intangible assets, including amortization related to the
adjustments of assets and liabilities to fair value in connection with the
adoption of SOP 90-7, consisted of the following (in thousands):
Three Months Ended April 30,
---------------------------
1997 1996
---- ----
(In thousands)
"Fresh Start" Amortization:
Amortization of Reorganization Value in
Excess of Identifiable Assets.............. $ -- 13,768
Amortization of Tradenames, Licenses,
Patents and Other.......................... 1,607 1,994
------- -------
1,607 15,762
Other......................................... 217 236
------- -------
$ 1,824 15,998
======= =======
"Fresh Start" amortization represents the expense arising from the adoption
of "fresh start" accounting in accordance with SOP 90-7. The reorganization
value in excess of identifiable assets was amortized over a three-year
period ending June 1996; licenses, patents and other are amortized over a
period ranging from one to twenty-three years, and tradenames are amortized
primarily over a period of forty years.
5. DEBT
Debt consisted of the following:
April 30, January 31,
1997 1997
---------- ------------
(In thousands)
Series B Senior Subordinated Notes (a)........... $109,200 190,000
Senior Credit Facility (b)....................... 9,000 50,000
Capital lease obligations........................ 4,584 5,091
Other (c)........................................ 40,299 47,621
------- -------
Total debt..................................... 163,083 292,712
Less short-term debt and current installments of
long-term obligations........................... (13,254) (24,957)
------- -------
$149,829 267,755
======= =======
(a) The Series B Senior Subordinated Notes bear interest at 11 1/8% and have
a maturity date of July 15, 2005. During the three months ended April
30, 1997, the Company retired $80,800,000 principal amount of
subordinated notes out of the proceeds from the public offering of
common stock (see Note 8). Redemption premiums totaling $8,684,000 were
paid in connection with the retirement of the notes. The redemption
premiums and the write-off of $2,558,000 of deferred financing costs
related to the subordinated notes are classified as an extraordinary
item, net of tax effects, in the accompanying statement of operations.
10
<PAGE>
SAMSONITE CORPORATION AND SUBSIDIARIES
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(b) The Senior Credit Facility provides for a $175 million revolving credit
facility which matures July 14, 2000. The remaining term loan portion of
the facility of $45 million was repaid during the three months ended
April 30, 1997 out of the proceeds from the public offering of common
stock (see Note 8).
The following amounts were outstanding at April 30, 1997 under the
Senior Credit Facility:
Revolving Credit Borrowings $ 9.0 million
Letters of Credit $36.3 million
Available borrowings were $129.7 million at April 30, 1997.
The Senior Credit Facility is secured by substantially all the Company's
U.S. assets, the capital stock of its principal domestic subsidiaries,
and 66% of the stock of its principal foreign subsidiaries. The agreement
contains financial covenants which require the Company to maintain
certain financial ratios and minimum amounts of earnings, exclusive of
interest, taxes, and non-cash charges. The agreement also contains
covenants limiting the amount of capital expenditures, investments in
certain subsidiaries, and dividends, among other restrictions. Under the
agreement, the Company has no amount available for the payment of
dividends at April 30, 1997.
(c) Other obligations consist of various notes payable to banks by foreign
subsidiaries aggregating $35.9 million and a $4.4 secured financing
arrangement with a foreign bank. Included in letters of credit
outstanding is a $29.5 million standby letter of credit issued to secure
the debt of foreign subsidiaries.
6. OTHER INCOME (EXPENSE) - NET
Other income (expense) - net consisted of the following:
<TABLE>
<CAPTION>
Three Months Ended April 30,
----------------------------
1997 1996
-------------- ------------
(In thousands)
<S> <C> <C>
Foreign currency transaction income (a)................. $3,277 1,455
Rental income........................................... 522 394
Favorable settlement of claims (b)...................... 2,128 --
Adjustment of allowances for factored receivables from
previous operations (c)............................... 1,458 --
Other................................................... (486) (57)
------ -----
$6,899 1,792
====== =====
</TABLE>
(a) Foreign currency transaction income for the three months ended April 30,
1997 includes $2,729,000 of unrealized exchange gains related to open
forward exchange contracts entered into to reduce foreign currency exposure
on certain foreign operations.
(b) Other income of $2,128,000 resulted from the favorable settlement for
approximately $11,000, including legal expenses, of claims against the
Company. The Company had previously accrued $2,139,000 for such claims as
part of its reorganization in bankruptcy. The claims are part of the
Contingent Liability with Respect to the Old Notes described in Note 13 to
the consolidated financial statements in the 1997 Form 10-K and relate to
interest on overdue installments of interest occurring prior to the
bankruptcy of the Company's predecessor in 1993.
11
<PAGE>
SAMSONITE CORPORATION AND SUBSIDIARIES
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(c) During the three months ended April 30, 1997, the Company recorded other
income of $1,458,000 for the reversal of allowances for factored
receivables from previous operations which were no longer necessary upon
the favorable settlement of receivables for which such allowances were
established.
7. EMPLOYEE STOCK OPTIONS
The Company has authorized 2,550,000 shares for the granting of options under
the 1995 Stock Option and Award Plan. See Note 9 to the consolidated
financial statements included in the 1997 Form 10-K for a description of such
plan. In addition, the Company has outstanding options and stock bonus awards
to current executives in connection with employment agreements.
At April 30, 1997, the Company had outstanding options for a total of
2,754,718 shares at options prices ranging from $10.875 to $47.875 per share.
Options for 413,532 shares were exercisable at April 30, 1997. Options for
62,139 shares under the 1995 Stock Option and Award Plan were exercised at an
average exercise price of $12.45 per share during the three months ended
April 30, 1997.
The Company has granted stock bonuses for a total of 116,667 shares to
certain officers payable if the officer remains continually employed by the
Company through the earlier of May 15, 1999 or one year after a change of
control event. The Company is recognizing compensation expense equal to the
fair market value at the date of the grant ($18.25 per share) over the three-
year vesting period.
8. PUBLIC STOCK OFFERING
On February 11, 1997, the Company completed the sale of 3,300,000 shares of
its common stock in a public offering and received net proceeds therefrom of
approximately $130.3 million. In addition, the former CEO exercised options
for 1,853,668 common shares and sold these shares in the public offering. The
Company received approximately $6.6 million in cash from the exercise of
these options. The total of the proceeds from this offering and the exercise
of the stock options of approximately $137.0 million has been applied as
follows: (i) $89.5 million to redeem and purchase in the market $80.8 million
principal amount of Series B Notes, including $8.7 million for early
redemption and market premiums, (ii) $45.0 million to repay amounts
outstanding on the term loan under the Senior Credit Facility, and (iii) the
remainder of the offering proceeds was applied to accrued interest and to
repay revolving credit borrowings under the Senior Credit Facility.
12
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
- ---------------------
THREE MONTHS ENDED APRIL 30, 1997 ("FISCAL 1998" OR "CURRENT YEAR") COMPARED TO
THREE MONTHS ENDED APRIL 30, 1996 ("FISCAL 1997" OR "PRIOR YEAR")
General. The Company analyzes its net sales and operations by the following
categories: (1) "European operations" which consist of its European sales
manufacturing and distribution operations whose reporting currency is the
Belgian franc, (2) "the Americas operations" which include sales, manufacturing,
and distribution operations in the United States, Mexico, Canada, Latin America
and (3) "International operations" which include the sales, manufacturing and
distribution operations in Singapore, India, and China; exports to the Far East
and Middle East; and global licensing operations.
Results of European operations were translated from Belgian francs to U.S.
dollars in fiscal 1998 and fiscal 1997 at average rates of approximately 33.86
and 30.24 francs to the U.S. dollar, respectively. This decrease in the value
of the Belgian franc of approximately 11% resulted in decreases in reported
sales, cost of sales and other expenses in fiscal 1998 compared to fiscal 1997.
The most significant effects from the difference in exchange rates from last
year to the current year are noted in the following analysis and referred to as
an "exchange rate difference". The Company enters into forward foreign exchange
contracts and option contracts to reduce its economic exposure to fluctuations
in currency exchange rates for the Belgian franc and other foreign currencies.
Such instruments are marked to market at the end of each accounting period;
realized and unrealized gains and losses are recorded in other income. During
fiscal 1998, the Company had net gains from such instruments of $3.3 million;
during fiscal 1997, the Company had net gains on such instruments of $1.5
million.
Net Sales. Consolidated net sales decreased from $169.9 million in fiscal 1997
to $169.6 million in fiscal 1998, a decrease of $0.3 million. Fiscal 1998 sales
were adversely affected by the large decrease in the value of the Belgian franc
compared to the U.S. dollar in fiscal 1998 and nonrecurring revenues of $4.0
million from the sale of licenses in the prior year. Adjusted for the effect of
the exchange rate difference and the license sale in the prior year, fiscal 1998
sales increased by $11.5 million or approximately 7%.
Sales from European operations decreased from $67.3 million in fiscal 1997 to
$65.7 million in fiscal 1998, a decrease of $1.6 million. Expressed in Belgian
francs, fiscal 1998 sales increased by 9.3% or $6.3 million from fiscal 1997;
however, the increase was more than offset by a $7.9 million exchange rate
difference. This increase is generally attributable to strong sales in the
Scandinavian and UK countries. Sales of hardside products were flat compared to
the prior year while softside product sales increased by approximately 20%.
Sales from the Americas operations increased from $87.7 million in fiscal 1997
to $95.3 million in fiscal 1998, an increase of $7.6 million or 8.7%. The
increase was largely due to an increase in U.S. retail sales of $6.6 million or
49% from the prior year. Comparable store sales increased by 22% from fiscal
1997. U.S. wholesale sales were flat compared to the prior year, increasing by
$0.8 million or approximately 1.3%. U.S. sales were negatively affected by $9
million of backorders associated with manufacturing transition problems; new
product introductions were not scheduled until late in the quarter. Sales from
the other Americas operations, including Mexico, Canada and Latin America, were
higher than the prior year by an aggregate of $0.2 million.
Sales from International operations decreased from $14.9 million in fiscal 1997
to $8.6 million in fiscal 1998, a decrease of $6.3 million. This decrease was
due to a $4.0 million nonrecurring sale of licenses in the prior year and a
decrease in export sales to the Far East and Middle East of $2.3 million.
13
<PAGE>
Gross profit. Consolidated gross profit for fiscal 1998 increased from fiscal
1997 by $1.6 million. Gross margin increased by 2.4 percentage points, from
39.0% in fiscal 1997 (as adjusted for the $4.0 million license sale) to 41.4% in
fiscal 1998.
Gross margins from European operations increased by 2.4 percentage points, from
39.0% in fiscal 1997 to 41.4% in fiscal 1998. The improvement is due to price
increases in selected product lines and lower costs from standardized global
production sources.
Gross margins for the Americas increased from 38.0% in fiscal 1997 to 41.3% in
fiscal 1998. The primary cause of the improvement was an increase in U.S.
wholesale margins from 35.5% to 40.8% which resulted primarily from price
increases on most product lines effective for orders received after March 1,
1997 and product cost improvements from global sourcing and product design
improvements.
Selling, General and Administrative Expenses ("SG&A"). Consolidated SG&A
increased by $0.7 million from fiscal 1997 to fiscal 1998. As a percent of
sales, SG&A was 31.9% in fiscal 1998 and 31.4% in fiscal 1997. Excluding
nonrecurring revenue of $4.0 million in fiscal 1997, SG&A would have been 32.2%
of sales.
SG&A for European operations decreased by $1.1 million from fiscal 1997 to
fiscal 1998. The exchange rate difference caused SG&A to decrease by $2.1
million. The remainder, an increase of $1.0 million, resulted from an increase
in SG&A expressed in Belgian francs of 5.2%. The increase in SG&A from last
year was due to higher advertising expenses of $0.8 million to support new
product introductions and planned sales growth; increased variable selling
expenses of $0.3 million related to higher sales levels; decreased bad debt
expense of $0.3 million due to recoveries on specific accounts written off in
fiscal 1997; and net increases of $0.2 million in all other SG&A.
SG&A for the Americas operations increased by $2.1 million in fiscal 1998
compared to fiscal 1997. SG&A for U.S. wholesale operations increased by $1.3
million in fiscal 1998 compared to fiscal 1997; SG&A for U.S. retail operations
increased by $1.5 million; and SG&A for the other Americas operations and
corporate headquarters expenses were down by $0.7 million from fiscal 1997.
Factors contributing to the net increase in the U.S. wholesale SG&A of $1.3
million were higher bad debt expense accruals of $1.0 million for potential bad
debts; increased cost of incentives, commissions, sales promotion and freight
totaling $1.0 million; decreased salaries and employee benefits from workforce
reductions of $0.6 million; and other net decreases of $0.1 million.
The increase in SG&A of $1.5 million for U.S. retail operations is due to the
increase in sales volume and number of retail stores; as a percent of retail
sales, retail SG&A decreased from 56% in fiscal 1997 to 45% in fiscal 1998.
The decrease in SG&A for other Americas operations, including corporate
headquarters, of $0.7 million from the prior year was primarily due to $0.5
million of reserves reversed for a settled insurance claim, the reversal of $0.6
million of excess restructuring reserves set up in the fourth quarter of fiscal
1997, and other net increases of $0.4 million.
SG&A for International operations was less in fiscal 1998 than fiscal 1997 by
approximately $0.3 million primarily due to decreases caused by consolidation
and workforce downsizing in export and global licensing operations, net of
increases in the emerging market subsidiaries.
Amortization of intangible assets. The Company recorded significant intangible
assets as a result of its reorganization in 1993. See the comparative analysis
of amortization of intangibles included elsewhere herein.
14
<PAGE>
Reorganization value in excess of identifiable assets became fully amortized as
of June 30, 1996, which generally accounts for the decrease in amortization of
intangible assets from $16.0 million in fiscal 1997 to $1.8 million in fiscal
1998.
Operating income (loss). Operating results improved from a loss in fiscal 1997
of $0.7 million to income in fiscal 1998 of $14.4 million, an increase of $15.1
million. This increase is a result of improved margins which increased gross
profit by $1.6 million from last year, the decrease in amortization of
intangibles of $14.2 million, and the increase in SG&A of $0.7 million.
Interest income. Interest income was comparable to fiscal 1997, decreasing by
$0.1 million.
Interest expense and amortization of debt issue costs. Interest expense and
amortization of debt issue costs decreased from $9.1 million in fiscal 1997 to
$6.2 million in fiscal 1998. The decrease was caused primarily by the
retirement of $80.8 million of subordinated debt and $46.7 million of bank debt
from the proceeds of a public stock offering. See Note 8 to the consolidated
financial statements included elsewhere herein.
Other, net. See Note 6 to the consolidated financial statements included
elsewhere herein for a comparative analysis of other income (expense). The
Company has entered into certain forward exchange contracts to hedge its
exposures to changes in exchange rates. Other income for fiscal 1998 includes
income from foreign currency transactions of $3.3 million. In fiscal 1997, such
transactions resulted in income of $1.5 million. The income recorded for the
three months ended April 30, 1997 results primarily from forward exchange
contracts selling forward the Belgian franc which has declined significantly
against the U.S. dollar since the contracts were executed. Of the income
recorded through April 30, 1997, approximately $2.7 million is unrealized; the
ultimate realization of this amount is subject to fluctuations in the exchange
rate of the U.S. dollar against the Belgian franc. The Company's open forward
exchange contracts against the franc have maturity dates extending through
January 1998.
Other income in fiscal 1998 includes $2.1 million from favorable settlement of
claims for interest on overdue installments of interest accruing prior to the
commencement of the bankruptcy of the Company's predecessor in 1993. See Note
6(b) to the consolidated financial statements included elsewhere herein for
further discussion of this item.
Other income for the three months ended April 30, 1997 also includes income of
approximately $1.5 million for the reversal of allowances for factored
receivables from previous operations which were no longer necessary upon the
favorable settlement of the receivables for which such allowances were
established.
Income taxes. Income tax expense increased from $3.0 million in fiscal 1997 to
$6.8 million in fiscal 1998. The increase in tax expense is due primarily to
higher consolidated pretax earnings in fiscal 1998. The relationship between
the expected income tax benefit computed by applying the U.S. statutory rate to
pretax income (loss) and income tax expense recognized results primarily because
of (i) the nondeductibility for tax purposes of amortization of reorganization
value in excess of identifiable assets, (ii) foreign income tax expense provided
on foreign earnings, and (iii) state and local income taxes.
Extraordinary loss. The extraordinary loss for the three months ended April 30,
1997 resulted from redemption premiums of $8.7 million on the early retirement
of $80.8 million principal amount of the Company's 11 1/8% Series B Senior
Subordinated Notes and the write-off of related deferred financing costs of $2.6
million, net of the tax effect of the transactions. See Note 5(a) to the
consolidated financial statements included elsewhere herein.
15
<PAGE>
Net income (loss). The Company had a net loss in fiscal 1997 of $10.8 million
and net income in fiscal 1998 of $1.9 million. The increase in the net income
from the prior year of $12.7 million is caused by the effect of the increases in
operating and other income and the decrease in interest expense, offset by the
increase in income tax expense and extraordinary loss.
Effects of Reorganization and Restructuring on Results of Operations. As
described in Note 1B to the consolidated financial statements included elsewhere
herein, the results of operations include the ongoing effects of fresh-start
reporting. The effects of fresh-start reporting on operating income (loss) are
as follows:
<TABLE>
<CAPTION>
THREE MONTHS ENDED APRIL 30,
--------------------------------
1997 1996
---- ----
(In thousands)
<S> <C> <C>
Operating income (loss)............................ $14,389 (738)
Fresh Start Amortization and Depreciation.......... 2,443 16,662
------- ------
Operating income before Fresh Start Amortization
and Depreciation................................. $16,832 15,924
======= ======
</TABLE>
The impact of the Fresh Start amortization and depreciation on Net Income (Loss)
and Net Income (Loss) Per Share are summarized as follows:
<TABLE>
<CAPTION>
THREE MONTHS ENDED APRIL 30,
----------------------------------
1997 1996
---- ----
(In thousands except share amounts)
<S> <C> <C>
Fresh Start Amortization and Depreciation..... $ 2,443 16,662
Tax Benefit................................... (1,002) (1,187)
------- ------
After-Tax Impact on Net Income (Loss)......... 1,441 15,475
======= ======
Impact on Net Income (Loss) Per Share......... $ .07 .97
======= ======
</TABLE>
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
One measure of liquidity is commonly referred to as Operating Cash Flow.
Operating Cash Flow is defined as operating income (loss) adjusted for noncash
operating expenses, including amortization and depreciation. The Company
believes that Operating Cash Flow provides useful information regarding the
Company's ability to incur and service debt, but that it should not be
considered a substitute for operating income or cash flow from operations
determined in accordance with generally accepted accounting principles. Other
companies may calculate Operating Cash Flow in a different manner and the
Company's presentation of Operating Cash Flow may not be comparable to similar
presentations reported by other companies. Operating Cash Flow does not take
into consideration substantial costs of doing business, such as interest
expense, and should not be considered in isolation from or as a substitute for
other measures of performance. Operating Cash Flow does not represent funds
available for discretionary use by the Company because these funds are required
for debt service, capital expenditures to replace fixed assets, and other
commitments and contingencies. Operating Cash Flow for the three months ended
April 30, 1997 and 1996 was computed as follows:
16
<PAGE>
<TABLE>
<CAPTION>
Three Months Ended April 30,
---------------------------------
1997 1996
----------------- ---------------
(In thousands)
<S> <C> <C>
Operating income (loss) $14,389 (738)
Fresh start amortization and depreciation 2,443 16,662
------- ------
Operating income before fresh start amortization and
depreciation 16,832 15,924
Other amortization and depreciation 4,765 4,506
------- ------
Operating Cash Flow $21,597 20,430
======= ======
</TABLE>
Operating Cash Flow increased from $20.4 million in fiscal 1997 to $21.6 million
in fiscal 1998, an increase of $1.2 million, primarily as a result of the
increase in operating income described under Results of Operations. The Company
believes that the current level of Operating Cash Flow is adequate to support
its existing credit facilities and service the Company's Series B Senior
Subordinated Notes and other long-term obligations.
Another measure of liquidity is net cash from operating activities, as reflected
in the consolidated statements of cash flows included elsewhere herein. Net cash
provided by (used in) operating activities of $4.1 million in fiscal 1998 and
($4.0) million in fiscal 1997 reflects net cash from operations of the Company
available or used for the Company's liquidity needs, after taking into
consideration the substantial costs of doing business not reflected in Operating
Cash Flow.
Cash flows provided by (used in) operating activities increased by $8.0 million
in fiscal 1998 from fiscal 1997. Of this amount, $4.0 million resulted from a
decrease in cash flow applied for working capital and other operating assets,
while cash flows from net income, adjusted for nonoperating and noncash charges,
increased by $4.0 million.
Cash flow provided by (used in) investing activities decreased from cash
provided by investing activities in fiscal 1997 of $1.1 million to cash used in
investing activities in fiscal 1998 of $9.0 million, a decrease of $10.1
million. Capital expenditures were $8.0 million in fiscal 1998 compared to $6.3
million in fiscal 1997. In fiscal 1997, cash was provided by liquidating assets
in discontinued operations of $7.2 million while in fiscal 1998, cash of $1.4
million was used to liquidate certain obligations remaining related to
discontinued operations. It is expected that the Company will continue to use
cash to fund these remaining obligations totaling approximately $10 million
through calendar 2000.
Cash flows provided by (used in) financing activities increased from $7.0
million used in financing activities in fiscal 1997 to cash flows provided by
financing activities in fiscal 1998 of $4.0 million. On February 11, 1997, the
Company completed the sale of 3,300,000 shares of its common stock in a public
offering and received net proceeds therefrom of approximately $130.3 million.
In addition, the Company's former Chief Executive Officer exercised stock
options for which the Company received approximately $6.6 million. The total of
the proceeds from this offering and the exercise of the stock options of
approximately $137.0 million has been applied as follows: (i) the Company has
retired $80.8 million principal amount of its 11 1/8% Series B Senior
Subordinated Notes for $89.5 million (which included contractual and market
redemption premiums of $8.7 million), (ii) the Company paid $45.0 million on the
term loan portion of the U.S. Senior Credit Facility, and (iii) the remainder of
the offering proceeds was applied to accrued interest and to repay revolving
credit borrowings under the Senior Credit Facility. Net short-term and long-term
bank debt reductions were $0.6 million and $44.6 million, respectively, for the
three months ended April 30, 1997. The debt repayment accomplished with the
stock offering proceeds substantially improves the Company's liquidity and debt
position and will result in an estimated decrease in cash required for interest
expense of approximately $12.2 million annually. The revolving credit line
portion of the U.S. Senior Credit Facility of $175.0 million remains available
to the Company, and the improvement in the Company's liquidity has reduced
interest rates and other fees charged under the U.S. Senior Credit Facility.
17
<PAGE>
Management is currently renegotiating the Senior Credit Facility to reflect its
improved financial condition as a result of the public offering and anticipates
execution of a new worldwide credit facility in June 1997. If the Company is
successful in obtaining substantial modifications to the Senior Credit Facility,
deferred financing costs ($4.1 million at April 30, 1997) will be written off as
an extraordinary loss upon execution of the new agreement.
At April 30, 1997, the Company had working capital of $138.7 million compared to
$105.4 million at January 31, 1997, an increase of $33.3 million. Current assets
increased by $3.6 million primarily due to an increase in receivables of $7.8
million and an increase in prepaid expenses of $2.7 million, both of which were
offset by a net decrease in cash, inventories, and other current assets of $6.9
million. Receivables increased due to a higher sales level in the last part of
the quarter. Current liabilities decreased by $29.7 million primarily due to a
decrease in current maturities of long-term obligations of $11.0 million, a
decrease in accrued liabilities of $23.5 million, and other net increases of
$4.8 million.
The Company's cash flow from operations together with amounts available under
its credit facilities were sufficient to fund fiscal 1998 operations, scheduled
payments of principal and interest on indebtedness and capital expenditures.
Management of the Company believes that cash flow from operations and available
borrowings under its credit facilities and new credit facilities in emerging
markets will be adequate to fund operating requirements and expansion plans
during the next 12 months. In addition, management currently believes the
Company will be able to meet long-term cash flow obligations from cash provided
by operations and other existing resources.
The Company's principal foreign operations are located in Western Europe, the
economies of which are not considered to be highly inflationary. Effective
February 1, 1997, the Company changed its functional currency from the peso to
the U.S. dollar for its primary Mexican subsidiary as a result of organization
changes resulting in a significant portion of the Mexican subsidiary's
operations, cash flow and financing being transacted in U.S. dollars. The
Company enters into foreign exchange contracts in order to hedge its exposure on
certain foreign operations through the use of forward delivery commitments.
During the past several years, the Company's most effective hedge against
foreign currency changes has been the foreign currency denominated debt balances
maintained in respect to its foreign operations. Geographic concentrations of
credit risk with respect to trade receivables are not significant as a result of
the diverse geographic areas covered by the Company's operations.
EFFECT OF RECENTLY ISSUED ACCOUNTING STANDARD
- ---------------------------------------------
The Financial Accounting Standards Board has issued Statement of Financial
Accounting Standards No. 128, Earnings Per Share ("SFAS 128") which will be
effective for interim and annual periods ending after December 15, 1997 and
changes the computation and disclosure requirements for earnings per share. Had
earnings per share been reported under the provisions of SFAS 128 for the three
months ended April 30, 1997, basic earnings per share before extraordinary item
would have been $.43 per share and earnings per share before extraordinary item
assuming dilution would have been $.41 per share. See Note 1E to the
consolidated financial statements included elsewhere herein for further
discussion of the effects of SFAS 128.
18
<PAGE>
SAMSONITE CORPORATION
PART II - OTHER INFORMATION
- ---------------------------
Item I - Legal Proceedings
-----------------
Reference is made to Note 13 to the consolidated financial statements included
in the Company's Form 10-K Annual Report for the fiscal year ended January 31,
1997 which describes litigation, commitments and contingencies.
The Company and certain of its subsidiaries are subject to or are defendants in
various other claims and actions arising in the ordinary course of business.
While it is not possible to predict the outcome of such other claims or actions,
it is management's opinion that, after discussion with counsel, the ultimate
disposition of these other claims and actions will not have a material adverse
effect on the Company's consolidated financial position, results of operations
or liquidity.
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) See Exhibit Index.
(b) Reports on Form 8-K.
None.
19
<PAGE>
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.
SAMSONITE CORPORATION
(REGISTRANT)
BY /S/ Thomas R. Sandler
-------------------------------------------
Name: Thomas R. Sandler
Title: Senior Vice President, Chief
Financial Officer, and Treasurer
Date: June 4, 1997
------------------
20
<PAGE>
INDEX TO EXHIBITS
EXHIBIT DESCRIPTION
- --------- -----------
3.1 Amended and Restated Certificate of Incorporation of the Company./1/
3.2 Certificate of Ownership and Merger dated July 14, 1995./2/
3.3 By-Laws of the Company./1/
4.1 Indenture, dated as of July 14, 1995, between the Company and United
States Trust Company of New York./2/
4.2 Registration Rights Agreement dated July 14, 1995, by and among the
Company, Donaldson, Lufkin & Jenrette Securities Corporation, and
Bear, Sterns & Co., Inc./2/
4.3 Specimen of Notes described in the Indenture./2/
10.1 Amendment to Employment Agreement, dated May 2, 1997, between the
Company and Richard R. Nicolosi.
27 Financial Data Schedule.
___________________
/1/ Incorporated by reference from the Company's Annual Report on Form 10-K for
the fiscal year ended January 31, 1997 (File No. 0-23214).
/2/ Incorporated by reference from the Registration Statement on Form S-4
(Registration No. 33-95642).
21
<PAGE>
Exhibit 10.1
AMENDMENT TO EMPLOYMENT AGREEMENT
The Agreement ("Employment Agreement") between Samsonite Corporation, a Delaware
corporation ("the Company") and Richard R. Nicolosi ("the Executive"), dated as
of May 15, 1996, is hereby amended as follows:
SECTION 7(d) is amended by restating the first sentence thereof as
follows: "Except as otherwise provided in this Section 7(d), the
Restricted Shares shall vest, and the restrictions imposed thereon shall
lapse, as to all such shares, on the second anniversary of the Effective
Date; provided that if a Change of Control occurs during the Term and the
Executive remains continually employed by the Company from the date
hereof to the Change of Control Date (as defined in the Stock Option
Agreement), then all of the Restricted Shares that have not theretofore
vested shall become vested as of the Change of Control Date."
All other terms and conditions of the Employment Agreement shall remain
in full force and effect.
IN WITNESS WHEREOF, the Company has caused its name to be subscribed to this
amendment by its duly authorized representative and the Executive has executed
this amendment as of the 2nd day of May, 1997.
Samsonite Corporation By: /s/ John P. Murtagh
--------------------
Name: John P. Murtagh
Title: Senior Vice President
By: /s/ Richard R. Nicolosi
------------------------
Richard R. Nicolosi
22
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
consolidated financial statements as of and for the three months ended April 30,
1997 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> JAN-31-1998
<PERIOD-START> FEB-01-1997
<PERIOD-END> APR-30-1997
<CASH> 3,110
<SECURITIES> 0
<RECEIVABLES> 100,451
<ALLOWANCES> 8,170
<INVENTORY> 134,298
<CURRENT-ASSETS> 298,709
<PP&E> 196,354
<DEPRECIATION> 55,262
<TOTAL-ASSETS> 589,404
<CURRENT-LIABILITIES> 160,035
<BONDS> 149,829
0
0
<COMMON> 204
<OTHER-SE> 173,564
<TOTAL-LIABILITY-AND-EQUITY> 589,404
<SALES> 169,562
<TOTAL-REVENUES> 169,562
<CGS> 99,293
<TOTAL-COSTS> 99,293
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 1,052
<INTEREST-EXPENSE> 6,207
<INCOME-PRETAX> 15,546
<INCOME-TAX> 6,829
<INCOME-CONTINUING> 8,499
<DISCONTINUED> 0
<EXTRAORDINARY> (6,633)
<CHANGES> 0
<NET-INCOME> 1,866
<EPS-PRIMARY> .09
<EPS-DILUTED> .09
</TABLE>
