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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended September 25, 1999
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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 000-23314
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TRACTOR SUPPLY COMPANY
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(Exact Name of Registrant as Specified in Its Charter)
Delaware 13-3139732
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(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
320 Plus Park Boulevard, Nashville, Tennessee 37217
- ---------------------------------------------- -----------------------------
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (615) 366-4600
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Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 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
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Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of the latest practicable date.
Class Outstanding at October 23, 1999
- ---------------------------------- --------------------------------------
Common Stock, $.008 par value 8,769,106
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TRACTOR SUPPLY COMPANY
INDEX
<TABLE>
<CAPTION>
Page No.
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<S> <C>
Part I. Financial Information:
Item 1. Financial Statements:
Balance Sheets -
September 25, 1999 and December 26, 1998 3
Statements of Income -
For the Fiscal Three and Nine Months Ended
September 25, 1999 and September 26, 1998 4
Statements of Cash Flows -
For the Fiscal Nine Months Ended
September 25, 1999 and September 26, 1998 5
Notes to Unaudited Financial Statements 6 - 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8 - 11
Item 3. Quantitative and Qualitative
Disclosures About Market Risk 11
Part II. Other Information:
Item 5. Other Information 12
Item 6. Exhibits and Reports on Form 8-K 12
</TABLE>
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
TRACTOR SUPPLY COMPANY
BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
<TABLE>
<CAPTION>
SEPT. 25, DECEMBER 26,
1999 1998
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(UNAUDITED)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents....................................................... $ 8,152 $ 18,201
Accounts receivable, net........................................................ 10,393 5,578
Inventories..................................................................... 234,831 171,749
Other current assets............................................................ 3,880 6,301
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Total current assets..................................................... 257,256 201,829
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Land.............................................................................. 6,654 6,871
Buildings and improvements........................................................ 54,367 49,437
Machinery and equipment........................................................... 37,811 23,121
Construction in progress.......................................................... 3,159 8,818
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101,991 88,247
Accumulated depreciation and amortization......................................... (33,116) (28,339)
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Property and equipment, net..................................................... 68,875 59,908
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Deferred income taxes............................................................. 1,426 1,426
Other assets...................................................................... 1,822 1,486
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Total assets............................................................. $ 329,379 $ 264,649
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable................................................................ $ 75,605 $ 60,900
Accrued expenses................................................................ 30,076 29,610
Short-term note payable......................................................... 15,000 --
Current maturities of long-term debt............................................ 3,138 3,138
Current portion of capital lease obligations.................................... 369 553
Income taxes currently payable.................................................. 1,298 4,134
Deferred income taxes........................................................... 7,964 7,964
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Total current liabilities................................................ 133,450 106,299
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Revolving credit loan............................................................. 47,210 19,000
Term loan......................................................................... 10,179 11,786
Other long-term debt.............................................................. 3,756 4,361
Capital lease obligations......................................................... 1,713 1,985
Other long-term liabilities....................................................... 507 527
Excess of fair value of assets acquired over cost less accumulated
amortization of $3,010 and $2,875, respectively................................. 580 715
Stockholders' equity:
Common stock, 100,000,000 shares authorized; $.008 par value; 8,764,278
and 8,748,105 shares issued and outstanding in 1999 and 1998, respectively.... 70 70
Additional paid-in capital...................................................... 42,589 42,213
Retained earnings............................................................... 89,325 77,693
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Total stockholders' equity.................................................... 131,984 119,976
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Total liabilities and stockholders' equity............................... $ 329,379 $ 264,649
=========== ===========
</TABLE>
The accompanying notes are an integral part of this statement.
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TRACTOR SUPPLY COMPANY
STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
FOR THE FISCAL FOR THE FISCAL
THREE MONTHS ENDED NINE MONTHS ENDED
---------------------------- ---------------------------
SEPT. 25, SEPT. 26, SEPT. 25, SEPT. 26,
1999 1998 1999 1998
---------------------------- ---------------------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
Net sales........................................ $ 160,214 $ 140,628 $ 499,985 $ 442,296
Cost of merchandise sold......................... 118,591 104,195 370,651 330,126
---------- ---------- ---------- ---------
Gross margin.................................. 41,623 36,433 129,334 112,170
Selling, general and administrative expenses..... 34,058 30,577 101,826 89,157
Depreciation and amortization.................... 1,941 1,370 5,204 3,964
---------- ---------- ---------- ---------
Income from operations........................ 5,624 4,486 22,304 19,049
Interest expense, net............................ 1,137 850 2,589 2,368
---------- ---------- ---------- ---------
Income before income taxes.................... 4,487 3,636 19,715 16,681
Income tax provision............................. 1,840 1,499 8,083 6,878
---------- ---------- ---------- ---------
Net income.................................... $ 2,647 $ 2,137 $ 11,632 $ 9,803
========== ========== ========== =========
Net income per share - basic.................. $ 0.30 $ 0.24 $ 1.33 $ 1.12
========== ========== ========== =========
Net income per share - assuming dilution...... $ 0.30 $ 0.24 $ 1.31 $ 1.11
========== ========== ========== =========
</TABLE>
The accompanying notes are an integral part of this statement.
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TRACTOR SUPPLY COMPANY
STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE FISCAL NINE MONTHS ENDED
--------------------------------
SEPT. 25, SEPT. 26,
1999 1998
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(UNAUDITED)
<S> <C> <C>
Cash flows from operating activities:
Net income........................................................... $ 11,632 $ 9,803
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization expense............................ 5,204 3,964
Loss (gain) on sale of property and equipment.................... (103) 134
Change in assets and liabilities:
Accounts receivable............................................ (4,815) (3,545)
Inventories.................................................... (63,082) (36,088)
Other current assets........................................... 2,410 (603)
Accounts payable............................................... 14,705 16,147
Accrued expenses............................................... 466 6,457
Income taxes currently payable................................. (2,836) (1,762)
Other.......................................................... (393) (131)
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Net cash used in operating activities.................................. (36,812) (5,624)
----------- ---------
Cash flows from investing activities:
Capital expenditures............................................... (14,698) (9,617)
Proceeds from sale of property and equipment....................... 543 233
---------- ---------
Net cash used in investing activities.................................. (14,155) (9,384)
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Cash flows from financing activities:
Net borrowings (repayments) under revolving credit loan............ 28,210 (838)
Borrowings under term loan agreement............................... -- 15,000
Repayments under short-term loan agreement......................... (1,607) (357)
Borrowings under short-term note payable........................... 15,000 --
Principal payments under capital lease obligations................. (456) (572)
Repayment of long-term debt........................................ (605) (545)
Proceeds from issuance of common stock............................. 376 215
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Net cash provided by financing activities.............................. 40,918 12,903
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Net decrease in cash and cash equivalents.............................. (10,049) (2,105)
Cash and cash equivalents at beginning of period....................... 18,201 8,477
---------- ---------
Cash and cash equivalents at end of period............................. $ 8,152 $ 6,372
========== =========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest............................................................. $ 2,560 $ 2,350
Income taxes......................................................... 10,918 8,533
</TABLE>
The accompanying notes are an integral part of this statement.
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TRACTOR SUPPLY COMPANY
NOTES TO UNAUDITED FINANCIAL STATEMENTS
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES:
The accompanying interim financial statements have been prepared without audit,
and certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted, although the Company believes that the
disclosures herein are adequate to make the information presented not
misleading. These statements should be read in conjunction with the Company's
annual report on Form 10-K for the fiscal year ended December 26, 1998. The
results of operations for the fiscal three and nine-month periods are not
necessarily indicative of results for the full fiscal year.
In the opinion of management, the accompanying interim financial statements
contain all adjustments (consisting only of normal recurring accruals) necessary
for a fair statement of the Company's financial position as of September 25,
1999 and its results of operations and its cash flows for the fiscal three and
nine-month periods ended September 25, 1999 and September 26, 1998.
Inventories
The accompanying unaudited financial statements have been prepared without full
physical inventories. The value of the Company's inventories was determined
using the lower of last-in, first-out (LIFO) cost or market. If the first-in,
first-out (FIFO) method of accounting for inventory had been used, inventories
would have been approximately $7,039,000 and $6,497,000 higher than reported at
September 25, 1999 and December 26, 1998, respectively. Since LIFO costs can
only be determined at the end of each fiscal year when inflation rates and
inventory levels are finalized, estimates of LIFO inventory costs are used for
interim financial reporting.
Net Income Per Share
Net income per share is calculated as follows (in thousands, except per share
amounts):
<TABLE>
<CAPTION>
1999
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THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 25, 1999 SEPTEMBER 25, 1999
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PER SHARE PER SHARE
INCOME SHARES AMOUNT INCOME SHARES AMOUNT
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Basic net income per share:
Net income $ 2,647 8,761 $ 0.30 $ 11,632 8,757 $ 1.33
======== =======
Stock options outstanding 52 106
------- ------ -------- ------
Diluted net income per share $ 2,647 8,813 $ 0.30 $ 11,632 8,863 $ 1.31
======= ====== ======== ======== ====== =======
</TABLE>
<TABLE>
<CAPTION>
1998
------------------------------------------------------------------------
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 26, 1998 SEPTEMBER 26, 1998
------------------------------------------------------------------------
PER SHARE PER SHARE
INCOME SHARES AMOUNT INCOME SHARES AMOUNT
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Basic net income per share:
Net income $ 2,137 8,741 $ 0.24 $ 9,803 8,740 $ 1.12
======= =======
Stock options outstanding 94 61
------- ------ -------- ------
Diluted net income per share $ 2,137 8,835 $ 0.24 $ 9,803 8,801 $ 1.11
======= ====== ======== ======== ====== =======
</TABLE>
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NOTE 2 - SEASONALITY:
The Company's business is highly seasonal, with a significant portion of its
sales and a majority of its income generated in the second fiscal quarter. The
Company typically operates at a loss in the first fiscal quarter.
NOTE 3 - SHORT-TERM NOTE PAYABLE:
In September 1999, the Company entered into an unsecured term note (the "Term
Note") with SunTrust Bank, Nashville, N.A. ("SunTrust") pursuant to which the
Company borrowed $15 million. The Term Note was pursuant to the Company's
existing loan agreement with SunTrust (the "Loan Agreement") and bears interest
at approximately 6.15% per year until its maturity in November 1999. There are
no compensating balance requirements associated with the Loan Agreement. The
Loan Agreement contains certain restrictions regarding additional indebtedness;
employee loans; business operations; guarantees; investments; mergers,
consolidations and sales of assets; transactions with subsidiaries; and liens.
In addition, the Company must comply with certain quarterly restrictions
regarding net worth, working capital, ratios of total liabilities to net worth
and interest coverage and current ratio requirements.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion and analysis describes certain factors affecting
Tractor Supply Company's (the "Company") results of operations for the fiscal
three and nine-month periods ended September 25, 1999 and September 26, 1998,
and significant developments affecting its financial condition since the end of
the fiscal year, December 26, 1998, and should be read in conjunction with the
Company's annual report on Form 10-K for the fiscal year ended December 26,
1998. The following discussion and analysis also contains certain historical and
forward-looking information. The forward-looking statements are made pursuant to
the safe harbor provisions of the Private Securities Litigation Reform Act of
1995 ("the Act"). All statements, other than statements of historical facts,
which address activities, events or developments that the Company expects or
anticipates will or may occur in the future, including such things as future
capital expenditures (including the amount and nature thereof), business
strategy, expansion and growth of the Company's business operations and other
such matters are forward-looking statements. To take advantage of the safe
harbor provided by the Act, the Company is identifying certain factors that
could cause actual results to differ materially from those expressed in any
forward-looking statements, whether oral or written, made by or on behalf of the
Company.
All phases of the Company's operations are subject to influences outside its
control. Any one, or a combination, of these factors could materially affect the
results of the Company's operations. These factors include general economic
cycles affecting consumer spending, weather factors, operating factors affecting
customer satisfaction, consumer debt levels, pricing and other competitive
factors, the ability to identify suitable locations and negotiate favorable
lease agreements on new and relocated stores and distribution facilities, the
timing and acceptance of new products in the stores, the mix of goods sold, the
continued availability of favorable credit sources and other capital market
conditions and the seasonality of the Company's business. Forward-looking
statements made by or on behalf of the Company are based on a knowledge of its
business and the environment in which it operates, but because of the factors
listed above, actual results could differ materially from those reflected by any
forward-looking statements. Consequently, all of the forward-looking statements
made are qualified by these cautionary statements and there can be no assurance
that the actual results or developments anticipated by the Company will be
realized or, even if substantially realized, that they will have the expected
consequences to or effects on the Company or its business and operations.
RESULTS OF OPERATIONS
The Fiscal Three Months (Third Quarter) and Nine Months Ended September 25, 1999
and September 26, 1998
Net sales increased 13.9% to $160.2 million for the third quarter of fiscal 1999
from $140.6 million for the third quarter of fiscal 1998. Net sales rose 13.0%
to $500.0 million for the first nine months of fiscal 1999 from $442.3 million
for the first nine months of fiscal 1998. The sales increases resulted primarily
from new stores as comparable store sales (excluding relocations, using all
stores open at least one year) increased 5.4% for the third quarter of fiscal
1999 and 6.0% for the first nine months of fiscal 1999 over the corresponding
periods in the prior fiscal year. The Company opened 24 new retail farm stores
(nine in the third quarter of fiscal 1999) and relocated one store during the
first nine months of fiscal 1999. The Company opened 12 new retail farm stores
(one in the third quarter of fiscal 1998) during the first nine months of fiscal
1998. Comparable store sales for the third quarter of fiscal 1999 increased 5.4%
despite (i) cycling the prior year's comparable store sales increase of 12.0%
and (ii) soft sales in late September (primarily attributable to drought
conditions in Texas and the Ohio valley). Other contributing factors included:
(a) the group of product departments remerchandised in the first quarter of 1999
reflected a comparable store sales increase of over 9% for the third quarter and
(b) the top core basic sales categories that represent more than a third of the
Company's business reflected a comparable store sales increase of over 10% for
the third quarter. At September 25, 1999, the Company operated 266 retail farm
stores (in 26 states) versus 240 stores (in 26 states) at September 26, 1998.
The Company's current plans call for the opening of approximately six additional
new stores in the fourth quarter of fiscal 1999. The Company is also well
positioned to achieve its goal of opening 33 new stores in fiscal 2000.
As part of the Company's on-going efforts to continually focus on improving its
comparable store sales, the Company is planning to undertake several new
merchandising initiatives in 2000, including (i) the remerchandising of our tool
corral (consisting primarily of compressors, welders, pressure washers,
generators, hand tools, and all related accessories), (ii) greater product
assortment in fencing and core agricultural maintenance products and (iii)
further enhancement of product offerings in equine, pet and bird feeding
departments. Further, planned marketing initiatives and research efforts include
(i) expanded use of television media, featuring Company spokesmen George
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Strait and John Lyons, (ii) increased coverage of key markets using targeted
newspaper circulars and radio, (iii) expanded event marketing and (iv)
data-based marketing.
The gross margin rate increased .1 percentage point to 26.0% of sales for the
third quarter of fiscal 1999 and increased .5 percentage points to 25.9% of
sales for the first nine months of fiscal 1999 compared with the corresponding
periods in the prior fiscal year. The gross margin rate increase for the third
quarter of fiscal 1999 was primarily due to improved product costs and new
higher margin products and product lines associated with the remerchandising
effort completed in the first quarter of fiscal 1999, as well as an increase in
volume purchase rebates.
As a percent of sales, selling, general and administrative ("SG&A") expenses
decreased .4 percentage points to 21.3% of sales in the third quarter of fiscal
1999 and increased .2 percentage points to 20.4% of sales for the first nine
months of fiscal 1999 primarily due to the Company's on-going efforts to control
operating expenses. On an absolute basis, SG&A expenses increased 11.4% to $34.1
million in the third quarter of fiscal 1999 and increased 14.2% to $101.8
million for the first nine months of fiscal 1999. The increased dollar amount
was primarily attributable to costs associated with new store openings (new
stores have considerably higher occupancy costs, primarily rent, than the
existing store base) and the incremental costs of certain planned infrastructure
investments. Depreciation and amortization expense increased 41.7% and 31.3%
over the prior year for the third quarter and the first nine months of fiscal
1999, respectively, due mainly to costs associated with new stores, costs
associated with the Company's installation of its new SAP merchandising and
distribution computer systems, and, to a lesser extent, from fixture costs
associated with the remerchandising effort completed during the first quarter of
fiscal 1999. Net interest expense increased 33.8% to $1.1 million in the third
quarter of fiscal 1999 and increased 9.3% to $2.6 million in the first nine
months of fiscal 1999 primarily due to additional borrowings under the Credit
Agreement and the Company's growth and expansion plans, including additional
inventory as discussed below.
The Company's effective tax rate decreased to 41.0% for both the third quarter
of fiscal 1999 and the first nine months of fiscal 1999, compared with 41.2% for
both the third quarter of fiscal 1998 and the first nine months of fiscal 1998,
primarily due to a lower effective state income tax rate in fiscal 1999.
As a result of the foregoing factors, net income for the third quarter of fiscal
1999 increased 23.9% to $2.6 million from $2.1 million for the third quarter of
fiscal 1998 and net income per share (assuming dilution) for the third quarter
of fiscal 1999 increased 25.0% to $.30 per share from $.24 per share for the
third quarter of last year. Net income for the first nine months of fiscal 1999
increased 18.7% to $11.6 million from $9.8 million for the first nine months of
fiscal 1998 and net income per share (assuming dilution) for the first nine
months of fiscal 1999 increased 18.0% to $1.31 per share from $1.11 per share
last year. As a percentage of sales, net income increased .2 percentage points
to 1.7% of sales for the third quarter of fiscal 1999 from 1.5% of sales for the
third quarter of fiscal 1998 and increased .1 percentage point to 2.3% of sales
for the first nine months of fiscal 1999 from 2.2% of sales for the first nine
months of fiscal 1998.
LIQUIDITY AND CAPITAL RESOURCES
In addition to normal operating expenses, the Company's primary ongoing cash
requirements are those necessary for the Company's expansion, remodeling and
relocation programs, including inventory purchases and capital expenditures. The
Company's primary ongoing sources of liquidity are funds provided from
operations, commitments available under its revolving credit agreement (the
"Credit Agreement") and short-term trade credit.
In September 1999, the Company entered into an unsecured term note (the "Term
Note") with SunTrust Bank, Nashville, N.A. ("SunTrust") pursuant to which the
Company borrowed $15 million. The Term Note was pursuant to the Company's
existing loan agreement with SunTrust (the "Loan Agreement") and bears interest
at approximately 6.15% per year until its maturity in November 1999. There are
no compensating balance requirements associated with the Loan Agreement. The
Loan Agreement contains certain restrictions regarding additional indebtedness;
employee loans; business operations; guarantees; investments; mergers,
consolidations and sales of assets; transactions with subsidiaries; and liens.
In addition, the Company must comply with certain quarterly restrictions
regarding net worth, working capital, ratios of total liabilities to net worth
and interest coverage and current ratio requirements.
The Company's inventory and accounts payable levels typically build in the first
fiscal quarter and again in the third fiscal quarter in anticipation of the
spring and fall selling seasons. At September 25, 1999, the Company's
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inventories had increased $63.1 million to $234.8 million from $171.7 million at
December 26, 1998. This increase resulted primarily from additional inventory
for new stores, planned inventory increases in seasonal product lines, as well
as unplanned inventory increases in certain basic goods. As a result of certain
complications relating to the Company's implementation of a new merchandising
and distribution computer system in the first quarter of 1999, the in-stock
position in many key categories of the Company's stores was compromised. In the
Company's attempt to rectify this situation, it over corrected the ordering of
these goods. While a significant reduction (approximately 25%) in the overstock
position was achieved during the third quarter, and further significant
reductions are expected through the fourth quarter, certain overstocks are not
expected to be fully resolved until the second quarter of 2000. The Company
believes these reductions can be achieved without taking significant incremental
markdowns. Short-term trade credit, which represents a source of financing for
inventory, increased $14.7 million to $75.6 million at September 25, 1999 from
$60.9 million at December 26, 1998. Trade credit arises from the Company's
vendors granting extended payment terms for inventory purchases. Payment terms
vary from 30 days to 180 days depending on the inventory product.
At September 25, 1999, the Company had working capital of $123.8 million, which
represented a $28.3 million increase from December 26, 1998. This increase
resulted primarily from an increase in inventories without a corresponding
increase in accounts payable and an increase in trade accounts receivable
(mainly due to commitments from vendors respecting the Company's 1999 marketing
campaign), partially offset by an increase in accrued expenses (mainly due to
deferred vendor support payments relating to the Company's 1999 marketing
campaign and, to a lesser extent, timing of payments).
Operations used net cash of $36.8 million and $5.6 million in the first nine
months of fiscal 1999 and 1998, respectively. The increase in net cash used in
the first nine months of fiscal 1999 resulted primarily from inventories
increasing at a faster rate than accounts payable in the first nine months of
fiscal 1999 compared to the first nine months of fiscal 1998, a smaller increase
in accrued expenses in the first nine months of fiscal 1999 compared to the
first nine months of fiscal 1998 (mainly due to the level of net deferred vendor
support payments relating to the Company's 1999 marketing campaign compared with
the increase experienced in the prior year, the first year of the program, and,
to a lesser extent, timing of payments) as well as a larger increase in trade
accounts receivable compared to the prior year (mainly due to commitments from
vendors respecting the Company's 1999 marketing campaign compared with the
increase experienced in the prior year, the first year of the program) and an
increase in income taxes payable (primarily due to timing of payments),
partially offset by the timing of certain prepaid expenses.
Cash used in investing activities of $14.2 million for the first nine months of
fiscal 1999 represented a $4.8 million increase over cash used in the first nine
months of fiscal 1998 of $9.4 million. The increase in cash used for capital
expenditures during the first nine months of fiscal 1999 compared to the prior
year primarily reflects expenditures for new stores (24 new stores were opened
and one store was relocated during the first nine months of fiscal 1999 compared
with 12 new store openings during the first nine months of fiscal 1998), costs
associated with the Company's installation of its SAP merchandising and
distribution computer systems, and, to a lesser extent, fixture costs associated
with the Company's remerchandising efforts.
Financing activities in the first nine months of fiscal 1999 provided $40.9
million in cash, which represented a $28.0 million, increase in net cash
provided over the $12.9 million in net cash provided in the first nine months of
fiscal 1998. This increase in net cash provided resulted primarily from net
short-term borrowings under the Credit Agreement of approximately $28.2 million
during the first nine months of fiscal 1999 compared to net repayments of
approximately $.8 million during the first nine months of fiscal 1998, as well
as short-term borrowings of $15.0 million under the Term Note, offset, in part,
by repayments under the Term Loan of approximately $1.6 million during the first
nine months of fiscal 1999.
The Company believes that its cash flow from operations, borrowings available
under its Credit Agreement and short-term trade credit will be sufficient to
fund the Company's operations and its growth and expansion plans for the next
several years.
YEAR 2000 READINESS PLANS
The Company previously reported that during the first fiscal quarter of 1999 it
had concluded the remaining conversion effort and completed its installation of
a new merchandise and warehouse management system, thus achieving full Year 2000
compliance for its remaining processing systems. That installation had been the
one
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remaining significant requirement for the Company to achieve Year 2000
compliance prior to the need to execute transactions with Year 2000 implications
(the processing concern created by the change in the century and the traditional
two-digit year fields embedded in most data processing systems is commonly
referred to as the "Year 2000" issue). The total estimated cost of the Company's
Year 2000 remediation efforts, of which the installation of the new system was
the major component, is approximately $10.0 million.
The Company's point-of-sale systems (the "POS systems") are supported by
numerous personal computers and servers that utilize standard operating system
software and hardware. Certain elements of this hardware and software required
upgrade and/or replacement to be fully Year 2000 compliant (collectively, the
"Year 2000 upgrades"). The Company completed the development and testing of
these Year 2000 upgrades for its POS systems during the second quarter of fiscal
1999, and completed the rollout thereof, during the third quarter of fiscal
1999. The Year 2000 upgrades, approximating $300,000, are a component of the
total estimated cost of the Company's Year 2000 remediation efforts indicated
above.
As a fundamental business consideration, the Company depends heavily on its
vendors to meet the purchasing requirements dictated by the Company's business
needs. To that end, the Company continues to work with each of its critical
vendors to determine the impact the Year 2000 issue will have on their ability
to source products for the Company and process purchase orders with delivery
requirements and terms involving the Year 2000. The Company continues to expect
each of these vendors will likewise take measures to address the risks imposed
by the Year 2000 and adequately prepare their own processing systems so that
their businesses will not be interrupted as a result of this issue. Accordingly,
the Company does not expect any significant interruption in its ability to
source its product needs with existing vendors. As an ongoing measure, the
Company will continue to address this risk with each new vendor to ensure
similar safeguards.
The Company further recognizes the potential impact the Year 2000 issue may have
relative to its customers, creditors and other service providers. The Company
has reviewed its exposure to business interruption or substantial loss in these
areas and believes no risk of material adverse consequences presently exists and
that any other risks previously identified will be resolved before the end of
fiscal 1999.
Finally, the Company engaged a consulting firm to perform an independent review
of its overall Year 2000 readiness plans and assist with any final remediation
efforts as appropriate. That independent review was completed during the third
quarter and divulged certain areas of varying exposure to the Company. The
Company has reviewed each of these areas and assessed the relative risks to its
business needs. While there were no significant areas of risk identified, the
Company will complete a final review during the fourth quarter of fiscal 1999 to
minimize the risk that any significant interruption in the business will occur.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company had no holdings of derivative financial or commodity instruments at
September 25, 1999. The Company is exposed to financial market risks, including
changes in interest rates. All borrowings under the Company's credit agreement
bear interest at a variable rate based on the prime rate or the London Interbank
Offered Rate. An increase in interest rates of 100 basis points would not
significantly affect the Company's net income. All of the Company's business is
transacted in U.S. dollars and, accordingly, foreign exchange rate fluctuations
have never had a significant impact on the Company, and they are not expected to
in the foreseeable future.
11 of 13
<PAGE> 12
PART II. OTHER INFORMATION
ITEM 5. OTHER INFORMATION
Effective as of September 1, 1999, Thomas O. Flood retired from his position as
Senior Vice President-Administration and Finance and Chief Financial Officer of
the Company, but remains a director of the Company.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
10.47 Term Note, dated as of September 2, 1999, issued by the
Company to SunTrust Bank, Nashville, N.A., a national banking
association, in the aggregate amount of $15 million.
10.48 Noncompetition Agreement, dated as of August 31, 1999, between
the Company and Thomas O. Flood.
10.49 Consulting Agreement, dated as of August 31, 1999, between the
Company and Thomas O. Flood.
27.1 Financial Data Schedule (only submitted to SEC in electronic
format).
(b) Reports on Form 8-K
There were no reports on Form 8-K filed by the Company during the fiscal
quarter ended September 25, 1999.
12 of 13
<PAGE> 13
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.
TRACTOR SUPPLY COMPANY
Date: October 29, 1999 By: /s/ Joseph H. Scarlett, Jr.
---------------------- ---------------------------------------
Joseph H. Scarlett, Jr.
Chairman of the Board,
President, Treasurer and
Chief Executive Officer
(Duly Authorized Officer &
Principal Financial Officer)
13 of 13
<PAGE> 1
EXHIBIT 10.47
TERM NOTE
Nashville, Tennessee $15,000,000.00
September 2, 1999
FOR VALUE RECEIVED, TRACTOR SUPPLY COMPANY, a Delaware corporation (the
"Borrower"), promises and agrees to pay to the order of SUNTRUST BANK,
NASHVILLE, N.A., a national bank (the "Lender"), at its offices in Nashville,
Tennessee, or at such other place as may be designated in writing by the holder,
in lawful money of the United States of America, the principal sum of up to
Fifteen Million and no/100 Dollars ($15,000,000.00) together with interest from
the date hereof on the unpaid principal balance outstanding, from time to time
hereon computed at a variable rate of interest equal to 75 basis points above
the 30 Day LIBOR Rate. As used herein, the 30-Day LIBOR Rate means the 30-day
LIBOR Rate depicted in Lender's Fund Management, Cost of Funds Report published
each Business Day for Lender by Telerate, Inc. The interest rate hereunder shall
be calculated based upon a year of 360 days for the actual number of days
elapsed.
This Note shall be payable as follows: on the 2nd day of November, 1999
this Note shall mature and the Borrower shall pay to the Lender an amount equal
to all outstanding principal, plus all then accrued interest.
This Note may be prepaid in whole or in part without penalty or
premium.
Notwithstanding any provision to the contrary, it is the intent of the
Lender, the Borrower, and all parties liable on this Note, that neither the
Lender nor any subsequent holder shall be entitled to receive, collect, reserve
or apply, as interest, any amount in excess of the maximum lawful rate of
interest permitted to be charged by applicable law or regulations, as amended or
enacted from time to time. In the event the Note calls for an interest payment
that exceeds the maximum lawful rate of interest then applicable, such interest
shall not be received, collected, charged, or reserved until such time as that
interest, together with all other interest then payable, falls within the then
applicable maximum lawful rate of interest. In the event the Lender, or any
subsequent holder, receives any such interest in excess of the then maximum
lawful rate of interest, such amount which would be excessive interest shall be
deemed a partial prepayment of principal and treated hereunder as such, or, if
the principal indebtedness evidenced hereby is paid in full, any remaining
excess funds shall immediately be paid to the Borrower. In determining whether
or not the interest paid or payable, under any specific contingency, exceeds the
maximum lawful rate of interest, the Borrower and the Lender shall, to the
maximum extent permitted under applicable law, (a) exclude voluntary prepayments
and the effects thereof, and (b) amortize, prorate, allocate, and spread, in
equal parts, the total amount of interest throughout the entire term of the
indebtedness; provided that if the indebtedness is paid in full prior to the end
of the full contemplated term hereof, and if the interest received for the
actual period of existence hereof exceeds the maximum lawful rate of interest,
the holder of the Note shall refund to the Borrower the amount of such excess or
credit the amount of such excess against the principal portion of the
indebtedness as of the date it was received, and, in such event, the Lender
shall not be subject to any penalties provided by any laws for contracting for,
charging, reserving, collecting or receiving interest in excess of the maximum
lawful rate of interest.
Following any default in payment of principal or interest, the
outstanding principal and unpaid interest shall bear interest at the Default
Rate (as such term is defined in that certain Loan Agreement executed by
Borrower and Lender dated June 30, 1998) until such default is cured or waived.
In case of suit, or if this obligation is placed in an attorney's hands for
collection or to protect the Lender's rights or security under this agreement,
the undersigned Borrower will pay all costs of collection and litigation,
including a reasonable attorney's fee.
Subject to any applicable notice and cure periods contained in that
certain Loan Agreement executed by Borrower and Lender dated June 30, 1998,
together with any amendments thereto (the "Loan Agreement"), upon the occurrence
of an Event of Default as defined in the Loan Agreement or upon the failure of
the Borrower to comply with its agreements as contained herein, the Lender may
declare all principal and interest outstanding hereunder to be due, payable and
collectible then or thereafter, without notice, as the holder may elect,
regardless of the date of maturity. The holder may waive any default before or
after the same has been declared and restore this Note to full force and effect
without impairing any rights hereunder, such right or waiver being a continuing
one.
The makers, endorsers, guarantors and all parties to this Note and all
who may become liable for same, jointly and severally waive presentment for
payment, protest, notice of protest, notice of nonpayment of this Note, demand
and all legal diligence in enforcing collection, and hereby expressly agree that
the lawful owner or holder of this Note may defer or postpone collection of the
<PAGE> 2
whole or any part thereof, either principal and/or interest, or may extend or
renew the whole or any part thereof, either principal and/or interest, or may
accept additional collateral or security for the payment of this Note, or may
release the whole or any part of any collateral security and/or liens given to
secure the payment of this Note, or may release from liability on account of
this Note any one or more of the makers, endorsers, guarantors and/or other
parties thereto, all without notice to them or any of them; and such deferment,
postponement, renewal, extension, acceptance of additional collateral or
security and/or release shall not in any way affect or change the obligation of
any such maker, endorser, guarantor or other party to this Note, or of any who
may become liable for the payment thereof.
This Note has been executed and delivered in, and shall be governed by
and construed according to the laws of the State of Tennessee except to the
extent pre-empted by applicable laws of the United States of America.
This Note may not be changed or terminated without the prior written
approval of the Lender and the Borrower. No waiver of any term or provision
hereof shall be valid unless in writing signed by the holder.
Executed as of the 2nd day of September, 1999.
BORROWER:
TRACTOR SUPPLY COMPANY
By: /s/ Joseph H. Scarlett, Jr.
---------------------------------------
Title: Chairman
------------------------------------
2
<PAGE> 1
EXHIBIT 10.48
NONCOMPETITION AGREEMENT
- --------------------------------------------------------------------------------
NONCOMPETITION AGREEMENT, dated as of this 31st day of August,
1999 (the "Agreement"), by and between Tractor Supply Company, a Delaware
corporation (the "Company"), and Thomas O. Flood (the "Executive").
W I T N E S S E T H:
WHEREAS, the Executive is the former Chief Financial Officer
and Senior Vice-President of Finance of the Company and has been actively
involved in, and has been instrumental in the success of, the business of the
Company;
WHEREAS, the Executive resigned from his position effective
September 1, 1999, but continues to serve on the Company's Board of Directors;
and
WHEREAS, the Company desires that the Executive not compete
with the Company, for a limited period of time, upon the terms and conditions
hereinafter provided.
NOW, THEREFORE, for and in consideration of the premises,
mutual covenants and agreements contained herein, and intending to be legally
bound hereby, the parties hereto hereby agree as follows:
1. NONCOMPETITION. During the period commencing on September
1, 1999 and ending on January 1, 2005 (the "Noncompetition Term"), the Executive
shall not, directly or indirectly, be associated with any entity whose primary
business is that of, or personally engage, whether as a director, officer,
employee, agent, consultant, partner, owner, independent contractor or
otherwise, in the business of, selling to the public on a retail basis goods of
the type then sold by the Company in any geographical area in which the Company
is then engaged in such business; provided, however, that notwithstanding the
foregoing, the Executive may own stock representing an aggregate of up to two
and one-half percent (2 1/2%) of the total equity of any corporation engaged in
such business in such geographical area whose securities are listed on a
national securities exchange or are traded in an over-the-counter market.
<PAGE> 2
2. HEALTH BENEFITS.
(A) COVERAGE. During the Noncompetition Term, the Company
shall either provide, or reimburse, at its option, the Executive or the
Executive's Eligible Dependents (as hereinafter defined) for the cost of, health
insurance coverage for the Executive and the Executive's Eligible Dependents
comparable to that provided by the Company to its senior executives from time to
time ("Health Benefits"). Notwithstanding the foregoing, in the event that any
person eligible for Health Benefits pursuant to this Section 2(a) shall also be
entitled to Medicare or other government or private third party health insurance
coverage ("Other Coverage"), such person shall promptly notify the Company in
writing of the terms of such Other Coverage. The Company's obligations with
respect to such person under this Section 2(a) may, at the Company's option, be
limited to (i) reimbursing such person for any premiums payable by such person
with respect to such Other Coverage, and (ii) providing, or reimbursing such
person for the cost of, any supplementary health insurance coverage necessary to
provide such person with aggregate health insurance coverage comparable to the
Health Benefits otherwise required by this Section 2(a).
(B) ELIGIBLE DEPENDENTS. For purposes of this Agreement,
an Eligible Dependent shall mean the Executive's spouse and any other dependent
of the Executive who would be eligible for coverage under any health insurance
plan maintained by the Company from time to time for its senior executives if
the Executive were then employed by the Company in a senior executive position.
3. OTHER COVENANTS.
(A) CONFIDENTIALITY.
(i) The Executive acknowledges and understands that the
Confidential Information (as hereinafter defined) of the Company is
valuable, special and unique to the business of the Company, that such
business depends on such Confidential Information and that the Company
desires to protect such Confidential Information by keeping it
confidential for the use and benefit of the Company. Based on the
foregoing, the Executive shall undertake the following obligations with
respect to such Confidential Information during the Noncompetition
Term: (A) the Executive shall keep any and all Confidential Information
in trust for the use and benefit of the Company, (B) except as required
by applicable law or as authorized in writing by the Board, (C) except
any information that shall become generally known to the industry
through no fault of Executive, (D) except any information that shall be
disclosed to Executive by a third party (other than an officer,
employee, agent or representative of the
-2-
<PAGE> 3
Company or any division subsidiary or affiliate of the Company) having
legitimate and unrestricted possession thereof and the unrestricted
right to make such disclosure, the Executive shall not disclose,
directly or indirectly, any Confidential Information of the Company,
(E) the Executive shall use his best efforts to ensure that all
Confidential Information is kept confidential for the use and benefit
of the Company, and (F) upon termination of this Agreement or at any
other time that the Company may in writing so request, the Executive
shall promptly deliver to the Company all materials constituting
Confidential Information (including all copies thereof) that are in
his possession or under his control.
(ii) For purposes of this Agreement, "Confidential
Information" shall mean any and all information developed by or for the
Company or any of its affiliates of which the Executive gains knowledge
during the Noncompetition Term (or gained knowledge prior to the
Noncompetition Term by reason of his employment with the Company) that
is (x) not generally known in any industry in which the Company or any
of its affiliates is or may become engaged, or (y) not publicly
available. Confidential Information includes, but is not limited to,
any information developed by or for the Company or any of its
affiliates concerning plans, marketing and sales methods, materials,
processes, business forms, procedures, devices, management information
services, computer programs and software, plans for development of
products or services or for expansion into new areas or markets,
internal operations and any trade secrets and proprietary information
of any type owned by the Company or any of its affiliates, together
with all written, graphic and other materials relating to all or any
part thereof.
(B) NON-SOLICITATION OF EMPLOYEES AND CUSTOMERS. During the
Noncompetition Term, the Executive shall not, and shall use his best efforts to
cause each business or entity with which he shall become associated not to, (i)
solicit for employment or employ any person who is then employed or during the
previous six months was employed in an executive or management position by the
Company, or (ii) solicit then-existing customers of the Company.
4. REMEDIES.
(A) INJUNCTIVE RELIEF. The Executive acknowledges that the
covenants and obligations of the Executive contained in Sections 1 and 3 hereof
relate to special, unique and extraordinary matters and are reasonable and
necessary to protect the legitimate interests of the Company, that a breach of
any of the terms of such covenants or obligations will cause the Company
irreparable injury for which adequate remedies at law are not available, and
that the Company shall be entitled to an injunction, restraining
-3-
<PAGE> 4
order or other equitable relief from any court of competent jurisdiction
restraining the Executive from any such breach.
(B) REMEDIES CUMULATIVE. The rights and remedies of the
Company under this Section 4 are cumulative and are in addition to any other
rights and remedies the Company may have at law or in equity.
5. NOTICES.
(a) All notices, requests, demands and other communications
required or permitted under this Agreement shall be in writing (including
telefax, telegraphic, telex or cable communication) and mailed, telefaxed,
telegraphed, telexed, cabled or delivered:
(i) If to the Executive, to:
502 Waxwood Drive
Brentwood, TN 37027
(ii) If to the Company, to:
Tractor Supply Company
320 Plus Park Boulevard
Nashville, Tennessee 37217
Facsimile: (615) 366-4686
Attention: Chief Executive Officer
(b) All notices and other communications required or
permitted under this Agreement which are addressed as provided in this Section 5
(i) if delivered personally against proper receipt or by confirmed telefax or
telex, shall be effective upon delivery, and (ii) if delivered (A) by certified
or registered mail with postage prepaid, (B) by Federal Express or similar
courier service with courier fees paid by the sender, or (C) by telegraph or
cable, shall be effective two business days following the date when mailed,
couriered, telegraphed or cabled, as the case may be. Either party hereto may
from time to time change its address for the purpose of notices to that party by
a similar notice specifying a new address, but no such change shall be deemed to
have been given until it is actually received by the party sought to be charged
with its contents.
-4-
<PAGE> 5
6. ASSIGNMENT.
(A) THE COMPANY. This Agreement and all of the terms and
provisions hereof shall be binding upon and inure to the benefit of the Company
and its successors and permitted assigns. The Company may not assign this
Agreement or any of its rights, interests or obligations hereunder without the
prior written consent of the Executive, except that it may make such an
assignment to any of its affiliates or to any successor to its business without
such consent.
(B) THE EXECUTIVE. This Agreement shall be binding upon and
inure to the benefit of the Executive, his Eligible Dependents, and their
respective heirs, beneficiaries, executors, administrators and legal
representatives; provided, however, that neither this Agreement nor any of the
rights, interests or obligations hereunder may be assigned by any such person
without the prior written consent of the Company.
7. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Tennessee,
without giving effect to the conflict of laws principles thereof.
8. MISCELLANEOUS.
(A) COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
when taken together shall constitute one and the same instrument.
(B) HEADINGS. The headings contained in this Agreement are
for convenience of reference only and shall not constitute a part hereof or
define, limit or otherwise affect the meaning or interpretation of any of the
terms or provisions hereof.
(C) ENTIRE AGREEMENT. This Agreement embodies the entire
agreement and understanding between the parties hereto with respect to the
subject matter hereof and supersedes all prior agreements, commitments,
arrangements or understandings, whether oral or written, between the parties
with respect thereto. There are no agreements, covenants, undertakings,
representations or warranties with respect to the subject matter of this
Agreement other than those expressly set forth or referred to herein.
(D) SEVERABILITY. Each term and provision of this Agreement
constitutes a separate and distinct undertaking, covenant, term and provision
hereof. In the event that any term or provision of this Agreement shall be
determined to be unenforceable, invalid or illegal in any respect, such
unenforceability, invalidity or
-5-
<PAGE> 6
illegality shall not affect any other term or provision of this Agreement, but
this Agreement shall be construed as if such unenforceable, invalid or illegal
term or provision had never been contained herein. Moreover, if any term or
provision of this Agreement shall for any reason be held to be excessively broad
as to time, duration, scope, activity or subject, it shall be construed, by
limiting and reducing it, so as to be enforceable to the extent permitted under
applicable law as it shall then exist.
(E) AMENDMENT; WAIVER. Neither this Agreement, nor any of
the terms or provisions hereof, may be amended, modified, supplemented or
waived, except by an instrument in writing signed by the parties hereto (or, in
the case of a waiver, by the party granting such waiver). No waiver of any of
the provisions of this Agreement shall be deemed or shall constitute a waiver of
any other provision hereof (whether or not similar), nor shall such waiver
constitute a continuing waiver. No failure of either party hereto to insist upon
strict compliance by the other party with any obligation, covenant, agreement or
condition contained in this Agreement shall operate as a waiver of, or estoppel
with respect to, any subsequent or other failure.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
TRACTOR SUPPLY COMPANY
By: /s/ Joe Scarlett
---------------------------------------
Joe Scarlett
Chairman &
Chief Executive Officer
EXECUTIVE:
/s/ Thomas O. Flood
----------------------------------------
Thomas O. Flood
-6-
<PAGE> 1
EXHIBIT 10.49
AGREEMENT
THIS AGREEMENT made and entered into on this 31st day of August, 1999, by and
between Tractor Supply Company (hereinafter referred to as "TSC") and Thomas O.
Flood (hereinafter referred to as "Consultant").
W I T N E S S E T H
1. CONSULTANT SERVICES. Consultant and TSC hereby agree that Consultant will
provide services on request for TSC as an independent contractor for the
period of time from January 1, 2000 through December 31, 2000. Consultant
warrants he exercises sole and exclusive control over the manner and means
he will use in providing consultant services to TSC. Commencing on the date
of this Agreement, Consultant warrants that he is an independent
contractor, solely responsible for (1) selecting and controlling the means
and facilities used to perform consultant services to TSC and (2)
satisfying all federal, state and local tax and other obligations related
to his earnings.
2. INDEMNIFICATION. Consultant agrees to indemnify TSC from any and all
liabilities, including, but not limited to, attorney's fees, incident to
any claim, loss, damage, or injury to the person or property of Consultant
injured through Consultant's acts or omissions.
3. AUTHORIZATION. Consultant agrees that he is not authorized to enter into
any contracts on behalf of, or in the name of, TSC without the prior
express written consent of TSC. Consultant acknowledges that when he is
performing services for TSC, he is to present himself as a consultant to,
rather than as a representative of, TSC. During the term of the Agreement,
Consultant will at all times represent to third parties and the public that
he is a consultant to, and not an employee of, TSC.
<PAGE> 2
4. COMPENSATION. TSC shall pay Consultant, and Consultant shall accept from
TSC, a fee of Sixteen Thousand six hundred sixty-six & 00/100 Dollars
($16,666.00) per month (not to exceed 20 hours per month) or as otherwise
agreed by the parties, for services rendered by Consultant, which services
have been assigned by TSC. Consultant agrees that he shall provide any
documentation and/or reports regarding his services as TSC may require.
5. MISCELLANEOUS EXPENSES. Consultant agrees he must submit any miscellaneous
expenses for reimbursement. Consultant agrees to follow TSC policies when
incurring expenses.
6. SEVERABILITY/BLUE PENCILING. Each provision of this Agreement shall be
considered severable from the rest. If a court of competent jurisdiction
should declare any provision of this Agreement unenforceable for any
reason, then the parties hereby acknowledge and agree that such court shall
have the express authority to reform the covenant to provide for reasonable
restrictions and/or to grant TSC such other relief at law or in equity as
reasonable or necessary to protect the interests of TSC.
7. ENTIRE AGREEMENT. TSC and Consultant agree that this Agreement contains the
complete agreement concerning the parties' relationship, written or oral,
between them. Both parties acknowledge having read and fully understand
this Agreement, and have voluntarily entered into this Agreement.
8. MODIFICATION. This Agreement shall not be modified or amended except by a
writing duly executed by both parties. No waiver of any provision of this
Agreement shall be effective unless the waiver is in writing and duly
executed by both parties.
<PAGE> 3
9. CHOICE OF LAW. This Agreement shall be governed and construed in accordance
with the laws of the State of Tennessee, and any dispute regarding this
Agreement shall be resolved in the federal or state courts located in
Davidson County, Tennessee.
IN WITNESS WHEREOF, the parties have caused this Agreement of be executed
and delivered this 31st day of August, 1999.
TRACTOR SUPPLY COMPANY
By: /s/ Joe Scarlett
-----------------------------------
Joe Scarlett
Chairman &
Chief Executive Officer
EXECUTIVE:
/s/ Thomas O. Flood
------------------------------------
Thomas O. Flood
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF TRACTOR SUPPLY COMPANY FOR THE NINE MONTHS ENDED
SEPTEMBER 25, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JAN-01-2000
<PERIOD-START> DEC-27-1998
<PERIOD-END> SEP-25-1999
<CASH> 8,152
<SECURITIES> 0
<RECEIVABLES> 10,493
<ALLOWANCES> 0
<INVENTORY> 234,831
<CURRENT-ASSETS> 257,256
<PP&E> 101,991
<DEPRECIATION> 33,116
<TOTAL-ASSETS> 329,379
<CURRENT-LIABILITIES> 133,450
<BONDS> 61,145
0
0
<COMMON> 70
<OTHER-SE> 131,914
<TOTAL-LIABILITY-AND-EQUITY> 329,379
<SALES> 499,985
<TOTAL-REVENUES> 499,985
<CGS> 370,651
<TOTAL-COSTS> 370,651
<OTHER-EXPENSES> 107,030
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,589
<INCOME-PRETAX> 19,715
<INCOME-TAX> 8,083
<INCOME-CONTINUING> 11,632
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 11,632
<EPS-BASIC> 1.33
<EPS-DILUTED> 1.31
</TABLE>
