SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 JUNE 30, 1996
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 1-13066
MIKASA, INC.
(Exact name of Registrant as specified in its charter)
Delaware 33-0099676
------------------------------- ----------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
20633 South Fordyce Ave., Long Beach, California 90810
------------------------------------------------ ----------
(Address of principal executive offices) (Zip Code)
(310) 886-3700
--------------
Registrant's telephone number, including area code
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
---- ----
As of June 30, 1996, a total of 22,280,490 shares of the
Registrant's Common Stock, $0.01 par value, were outstanding.
Manually Signed Original
Exhibit Index on Page 19
Page 1 of 20 pages
Page 1 of 20 <PAGE>
MIKASA, INC.
TABLE OF CONTENTS
Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets as of
June 30, 1996 and December 31, 1995 3
Consolidated Statements of Income
for the three months ended June 30,
1996 and 1995, and six months ended
June 30, 1996 and 1995 5
Consolidated Statements of Cash Flows
for the six months ended June 30,
1996 and 1995 6
Notes to Consolidated Financial
Statements 8
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of
Operations 9
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of
Security Holders 16
Item 6. Exhibits and Reports on Form 8-K 17
Signatures 18
Page 2 of 20 <PAGE>
<TABLE> PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
MIKASA, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
<CAPTION>
June 30, December 31,
1996 1995
----------- ------------
(Unaudited)
ASSETS
<S> <C> <C>
Cash, cash equivalents and short-term investments $ 44,708 $ 73,726
Accounts receivable trade, net 22,669 23,436
Inventories 164,012 152,679
Prepaid expenses and other current assets 6,566 6,906
-------- --------
Total current assets 237,955 256,747
Property and equipment, net 47,762 36,076
Notes receivable and other assets 679 769
Intangible assets, net 5,285 5,420
-------- --------
Total assets $291,681 $299,012
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts and notes payable $ 13,871 $ 17,824
Other current liabilities 16,330 19,656
-------- --------
Total current liabilities 30,201 37,480
Deferred income taxes 1,464 1,464
Notes payable 60,000 60,000
-------- --------
Total liabilities 91,665 98,944
-------- --------
Page 3 of 20 <PAGE>
Preferred stock, undesignated, $0.01 par value;
authorized 20,000 shares; none issued and outstanding -- --
Common stock, $0.01 par value; authorized 80,000
shares; issued and outstanding 22,280 shares 49,532 49,532
Cumulative translation adjustment 720 1,026
Retained earnings 149,764 149,510
-------- --------
Total stockholders' equity 200,016 200,068
-------- --------
Total liabilities and stockholders' equity $291,681 $299,012
======== ========
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
Page 4 of 20 <PAGE>
<TABLE> MIKASA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share data)
<CAPTION>
For The Three Months For The Six Months
Ended June 30, Ended June 30,
--------------------- ---------------------
1996 1995 1996 1995
-------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net sales $ 76,476 $ 76,855 $145,696 $146,674
Cost of sales 42,089 42,845 80,560 82,104
-------- -------- -------- --------
Gross profit 34,387 34,010 65,136 64,570
Selling, general and administrative
expenses 31,193 26,284 60,065 51,026
Store closure charge 4,100 --- 4,100 ---
-------- -------- -------- --------
Income (loss) from operations (906) 7,726 971 13,544
Interest expense (income), net 339 101 551 (146)
-------- -------- -------- ---------
Income (loss) before income taxes (1,245) 7,625 420 13,690
Income tax provision (benefit) (492) 2,982 166 5,353
-------- -------- -------- --------
Net income (loss) $ (753) $ 4,643 $ 254 $ 8,337
======== ======== ======== ========
Net income (loss) per share of
common stock $ (0.03) $ 0.21 $ 0.01 $ 0.37
======== ======== ======== ========
Weighted average number of shares of
common stock and common stock
equivalents outstanding 22,280 22,280 22,280 22,280
======== ======= ======== ======
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
Page 5 of 20 <PAGE>
<TABLE> MIKASA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
<CAPTION>
For The Six Months Ended
June 30,
---------------------------
1996 1995
----------- ---------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 254 $ 8,337
Adjustments to reconcile net income to net
cash used in operating activities:
Depreciation and amortization 2,282 1,723
Changes in operating assets and liabilities (17,542) (28,631)
----------- ---------
Net cash used in operating activities (15,006) (18,571)
----------- ---------
Cash flows from investing activities:
Capital expenditures (14,014) (2,618)
Decrease in notes receivable 151 1,430
----------- ---------
Net cash used in investing activities (13,863) (1,188)
----------- ---------
Cash flows from financing activities:
Net payments of short-term debt (11) (323)
----------- ---------
Net cash used in financing activities (11) (323)
----------- ---------
Effect of exchange rate changes on cash
and cash equivalents (138) 773
----------- ---------
Net decrease in cash, cash equivalents
and short-term investments (29,018) (19,309)
Page 6 of 20 <PAGE>
Cash, cash equivalents and short-term
investments, beginning of period 73,726 76,885
----------- ---------
Cash, cash equivalents and short-term
investments, end of period $ 44,708 $ 57,576
=========== =========
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
Page 7 of 20 <PAGE>
MIKASA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(In thousands)
1. Interim Financial Statements:
-----------------------------
The accompanying consolidated financial statements of
Mikasa, Inc. and its wholly-owned and majority-owned subsidiaries
(the "Company") have not been audited by independent accountants,
except for the balance sheet as of December 31, 1995. In the
opinion of management, all adjustments (consisting of normal
recurring adjustments) considered necessary for a fair
presentation have been included. Operating results for the six
months ended June 30, 1996 are not necessarily indicative of the
results that may be expected for the year ending December 31,
1996.
2. Income Taxes:
-------------
For the six months ended June 30, 1996, income taxes have
been provided at an estimated annual rate of 39.5% of income
before taxes. For the six months ended June 30, 1995, income
taxes have been provided at an estimated annual rate of 39.1% of
income before taxes.
3. Accounts Receivable, Trade:
---------------------------
Receivables are net of allowances for uncollectible accounts
of $567 at June 30, 1996 and $614 at December 31, 1995.
4. Property and Equipment:
-----------------------
Property and equipment, at cost, are net of accumulated
depreciation and amortization of $21,058 at June 30, 1996 and
$19,098 at December 31, 1995.
5. Intangible Assets:
------------------
Intangible assets are net of accumulated amortization of
$2,023 at June 30, 1996 and $1,888 at December 31, 1995.
6. Store Closures Charge:
----------------------
For the second quarter ended June 30, 1996, the Company has
decided to close ten stores that were not performing up to its
expectations. The Company recognized an estimated $4,100 in
non-recurring pre-tax charges related to these anticipated store
closures in the current period, or $0.11 per share after tax.
These stores are expected to close over the next 12 months.
Page 8 of 20 <PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Results of Operations
---------------------
The following table sets forth certain financial and
operations data for the periods indicated:
Three Months Ended
June 30,
-------------------
1996 1995
------ ------
Net Sales by Channel of Distribution:
Direct to consumers $ 40,846 $ 38,569
Retail accounts 29,930 34,472
International 5,700 3,814
---------- ---------
Total $ 76,476 $ 76,855
========== =========
Operations Data:
Stores open at beginning of period 121 101
U. S. stores opened during period 3 6
Canadian store opened during period 1 --
Stores closed during period <F1> -- --
---------- ---------
Stores open at end of period 125 107
========== =========
Percentage increase (decrease) in (4.5%) 0.1%
comparable store net sales
As of June 30,
-------------------
1996 1995
------ ------
Total U. S. store gross square footage 1,149,900 991,600
--------------------
<F1> The Company has decided to close ten stores that were not
performing up to its expectations. See "Management's
Discussion and Analysis of Financial Condition and Results
of Operations-Store Closures Charge."
THREE MONTHS ENDED JUNE 30, 1996 COMPARED TO THREE MONTHS ENDED
JUNE 30, 1995
---------------------------------------------------------------
NET SALES. Net sales for the three months ended June 30,
1996 (the "current period") were $76.5 million, a decrease of
Page 9 of 20 <PAGE>
$0.3 million or 0.5% from net sales of $76.8 million for the
three months ended June 30, 1995 (the "prior period"). Net sales
generated from United States operations decreased to $70.8
million in the current period from $73.0 million in the prior
period, a decrease of $2.2 million or 3.1%. Of the Company's net
sales decline in the United States, a decrease of $4.5 million or
13.2% from the prior period was accounted for by the retail
account channel of distribution which was offset by an increase
of $2.3 million or 5.9% over the prior period by the direct
consumer channel of distribution. The Company's international
business contributed $5.7 million in net sales in the current
period, an increase of $1.9 million or 49.4% over the prior
period net sales of $3.8 million. Sales to retail accounts
during the current period were below the prior period because
of several factors, including reduced orders resulting from
the consolidation in the department store and mass merchant
markets and the election of certain customers to switch to
electronic data interchange. The decrease in net sales from
the domestic operations discussed above resulted from a
decrease in the number of units sold which was partially
offset by an increase in prices.
GROSS PROFIT. Gross profit for the current period was $34.4
million, an increase of $0.4 million or 1.1% over the prior
period's gross profit of $34.0 million. Gross profit as a
percentage of net sales increased to 45.0% in the current period
from 44.3% in the prior period. The gross profit increase as a
percentage of net sales was primarily due to the heavier
weighting of more profitable direct consumer and international
business.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. Selling,
general and administrative expenses in the current period were
$31.1 million, an increase of $4.9 million or 18.7% over the
prior period selling, general and administrative expenses of
$26.2 million. As a percentage of net sales, such expenses
increased to 40.8% in the current period from 34.2% in the prior
period. During the current period, expenses associated with
stores opened less than one year accounted for $2.5 million of
the increase in selling, general and administrative expenses. The
Company follows the practice of expensing all costs associated
with new store openings in the period incurred. Such pre-opening
expenses were $0.6 million for both the current period and the
prior period.
STORE CLOSURES CHARGE. The Company has decided to close ten
stores of which nine have been operating for more than one year
that were not performing up to its expectations. The Company
recognized an estimated $4.1 million in non-recurring pre-tax
charges related to these anticipated store closures in the
current period, or $0.11 per share after tax. These stores are
expected to close over the next 12 months. The Company believes
these closures should have a positive impact on future earnings.
The Company will continue to review its store performances to
identify stores that are not performing to the Company's
expectations.
Page 10 of 20 <PAGE>
The preceding forward-looking statement involves risks and
uncertainties inherent in the Company's business. The
anticipated positive impact on future earnings of store closures
is subject to risks and uncertainties as to whether the Company
will be able to accomplish store closures within the current time
table for closure and within the parameters of the loss
provision, which are based on current estimates of closure costs.
Actual closure costs may vary.
INCOME (LOSS) FROM OPERATIONS. (Loss) from operations in
the current period was ($0.9) million, a decrease of $8.6 million
from the prior period's income from operations of $7.7 million.
This represented a decrease as a percentage of net sales to 1.2%
in the current period from 10.1% in the prior period. This
decrease was primarily attributable to expenses related to
anticipated store closures and the increase in selling, general
and administrative expenses as a percentage of net sales,
partially offset by the increase in gross profit as a percentage
of net sales. Additionally, the combined effect of higher
anticipated operating expenses associated with the Company's
expanded retail store base and lower than expected domestic sales
contributed to the decline in income from operations.
INTEREST EXPENSE, NET. Net interest expense was $0.3
million in the current period, an increase of $0.2 million from
the prior period net interest expense of $0.1 million. The
increase in net interest expense was primarily due to decreased
interest income in the current period as a result of less cash
available for investment and lower earnings yields.
SIX MONTHS ENDED JUNE 30, 1996 COMPARED TO SIX MONTHS ENDED
JUNE 30, 1995
-----------------------------------------------------------
NET SALES. Net sales for the six months ended June 30, 1996
(the "current period") were $145.7 million, a decrease of $0.9
million or 0.7% over net sales of $146.6 million for the six
months ended June 30, 1995 (the "prior period"). Net sales
generated from United States operations decreased to $134.2
million in the current period from $138.1 million in the prior
period, a decrease of $3.9 million or 2.8%. Of the Company's net
sales decline in the United States, a decrease of $11.3 million
or 15.9% from the prior period was accounted for by the retail
account channel of distribution which was offset by an increase
of $7.4 million or 11.1% over the prior period by the direct
consumer channel of distribution. The Company's international
business contributed $11.5 million in net sales in the current
period, an increase of $3.0 million or 33.2% over the prior
period net sales of $8.5 million. Sales to retail accounts
during the current period were below the prior period because
of several factors, including reduced orders resulting from
the continued consolidation in the department store and mass
merchant markets and the election of certain customers to
switch to electronic data interchange. The decrease in net
sales from domestic operations discussed above resulted
Page 11 of 20 <PAGE>
from a decrease in the number of units sold which was
partially offset by an increase in prices.
GROSS PROFIT. Gross profit for the current period was $65.1
million, an increase of $0.6 million or 0.9% over the prior
period's gross profit of $64.5 million. Gross profit as a
percentage of net sales increased to 44.7% in the current period
from 44.0% in the prior period. The gross profit increase as a
percentage of net sales was due to the heavier weighting of more
profitable direct consumer and international business.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. Selling,
general and administrative expenses in the current period were
$60.0 million, an increase of $9.0 million or 17.7% over the
prior period selling, general and administrative expenses of
$51.0 million. As a percentage of net sales, such expenses
increased to 41.2% in the current period from 34.8% in the prior
period. During the current period, expenses associated with
stores opened less than one year accounted for $5.1 million of
the increase in selling, general and administrative expenses. The
Company follows the practice of expensing all costs associated
with new store openings in the period incurred. Such pre-opening
expenses were $1.1 million for both the current period and the
prior period.
STORE CLOSURES CHARGE. The Company has decided to close
ten stores of which nine have been operating for more than one
year that were not performing up to its expectations. The
Company recognized an estimated $4.1 million in non-recurring
pre-tax charges related to these anticipated store closures in
the current period, or $0.11 per share after-tax. These stores
are expected to close over the next 12 months. The Company
believes these closures should have a positive impact on future
earnings. The Company will continue to review its store
performances to identify stores that are not performing to the
Company's expectations.
The preceding forward-looking statement involves risks and
uncertainties inherent in the Company's business. The
anticipated positive impact on future earnings of store closures
is subject to risks and uncertainties as to whether the Company
will be able to accomplish store closures within the current time
table for closure and within the parameters of the loss
provision, which are based on current estimates of closure costs.
Actual closure costs may vary.
INCOME (LOSS) FROM OPERATIONS. Income from operations in
the current period was $1.0 million, a decrease of $12.5 million
from the prior period's income from operations of $13.5 million.
This represented a decrease as a percentage of net sales to 0.7%
in the current period from 9.2% in the prior period. This
decrease was primarily attributable to the expenses related to
certain anticipated store closures and the increase in selling,
general and administrative expenses as a percentage of net sales,
partially offset by the increase in gross profit as a percentage
Page 12 of 20 <PAGE>
of net sales. Additionally, the combined effect of higher
anticipated operating expenses associated with the Company's
expanded retail store base and lower than expected domestic sales
contributed to the decline in income from operations.
INTEREST EXPENSE, NET. Net interest expense was $0.6
million in the current period, an increase of $0.7 million from
the prior period net interest income of ($0.1) million. The
increase in net interest expense was due to decreased interest
income in the current period which was primarily the result of
less cash available for investment and lower earnings yields.
LIQUIDITY AND CAPITAL RESOURCES
-------------------------------
Historically, the Company has used cash from operations and
debt financing to fund working capital requirements and capital
expenditures. On June 2, 1994, the Company obtained $23.1
million in net proceeds from its initial public offering. Also,
on May 19, 1993, the Company obtained $60.0 million in a
placement of unsecured senior notes with a group of insurance
companies and a $50.0 million unsecured revolving credit facility
provided by two banks. The senior notes bear interest at the
rate of 6.66% per annum payable semi-annually and mature on May
19, 2003. Principal payments of $10.0 million per year will be
due annually, commencing on May 19, 1998. The maturity date of
the revolving credit facility is May 19, 1998, subject to
automatic extensions in one year increments at the end of each
commitment year, unless either bank delivers a notice of
intention not to extend the maturity date. As of June 30, 1996,
$4.0 million had been used for letters of credit under the
revolving credit facility, and $46.0 million was unused and
available.
The Company had working capital of $207.8 million at
June 30, 1996 and working capital of $219.3 million at
December 31, 1995. Net cash used in operating activities was
$15.0 million and $18.6 million in the six months ended June 30,
1996 and 1995, respectively. The decrease in net cash used in
operating activities in the six months ended June 30, 1996
compared to the same period of 1995 is attributable to the
reduction in inventory purchases partially offset by the decrease
in net income, income taxes payable and prepaid expenses. During
1995, the Company purchased inventory at a level greater than its
rate of sale which resulted in a higher inventory level and
higher use of cash in operating activities of $34.9 million for
fiscal year 1995. The Company has decreased its inventory
purchases during 1996 and expects to continue such decreased
purchase levels until the inventory balance is restored to an
acceptable balance for its business without impairing its
expansion plans. Use of cash in operating activities for
inventory for the six months ended June 30, 1996 increased by
$11.4 million compared to an increase of $25.5 million for the
six months ended June 30, 1995.
Page 13 of 20 <PAGE>
Net cash used in investing activities was $13.9 million and
$1.2 million in the six months ended June 30, 1996 and 1995,
respectively. The Company made capital expenditures of $14.0
million in the six months ended June 30, 1996 (consisting
primarily of the construction of the new distribution center in
South Carolina, new retail stores' fixtures and leasehold
improvements, distribution facilities' fixtures and renovation of
existing retail stores) and $2.6 million in the six months ended
June 30, 1995 (consisting primarily of new retail stores'
fixtures and leasehold improvements and distribution facilities'
fixtures).
Certain monetary assets and liabilities of the Company are
in foreign currencies and may be subject to foreign exchange
risk. Foreign currency exchange losses have not in the past had
a material effect on the Company's financial condition since
these assets and liabilities are not material to its consolidated
monetary assets and liabilities. As such, these items have not
been hedged by the Company.
The Company's inventory purchases in 1995 were approximately
31% from Japanese factories and approximately 32% from Germany
and Austria combined. The significant portion of the inventory
purchases in foreign currencies exposes the Company to foreign
currency fluctuations that can affect the Company's gross profit
margin. The U.S. dollar has stabilized recently in relation to
the Japanese yen and German mark from its substantial weakening
early in 1995. To hedge against the foreign currency swings, the
Company has strategies in place which are intended to minimize
the adverse impact of foreign currency on its business. These
strategies are: (i) Currency risk sharing arrangements with
certain of the Company's suppliers; (ii) Forward exchange
contract coverage on part of its German mark related purchases;
(iii) Sourcing of products from currencies other than Japanese
and German where feasible; and (iv) Converting certain purchases
from foreign currency to U.S. dollar denominations. The currency
risk sharing arrangements are intended to minimize the impact of
currency swings by the equal sharing of currency exposures
against inventory purchases denominated in Japanese yen between
the suppliers and the Company. Future fluctuations of the U.S.
dollar in relation to foreign currencies can impact earnings in
future periods.
The Company has two primary distribution centers in the
United States, located in Secaucus, New Jersey and Long Beach,
California. While the Secaucus facility is owned, the Long Beach
facility is leased pursuant to a lease expiring in January 1998
which includes two one-year extension options. The Company also
leases additional off-site warehouse space on a short-term and
mid-term basis in separate buildings to augment each of these
primary facilities. In March 1996, the Company announced plans
to construct a new distribution facility in South Carolina.
Construction of the 580,000 square foot facility commenced in the
second quarter of 1996 and is anticipated to be completed in the
latter part of 1997. Capital commitments associated with the
Page 14 of 20 <PAGE>
facility are estimated at approximately $60 million, to be
financed principally with existing funds and cash generated from
operations. The Company is also evaluating possible alternative
methods of financing the facility. The new facility should
enable the Company to eliminate the need for offsite facilities
in Long Beach and Secaucus and accommodate substantially
increased volume. The Company believes that the use of state of
the art distribution technology in the new facility and relief
from inefficiencies resulting from overcrowding of existing
facilities should provide long term benefits. The Company
anticipates certain transition costs in the mid-term which may
impact earnings at that time.
As of the close of the second quarter of 1996, Company owned
stores increased to 125, the number of states in which the
Company operates stores increased to 41, and the Company opened
its first Canadian store in June 1996. The Company plans to
continue to pursue expansion of its store network. Present plans
include opening between 20 and 30 stores in each of 1996 and
1997, including the 7 stores already opened during 1996. Each
store requires a commitment of inventory, fixtures, equipment and
pre-opening store expenses. Additional capital will be required
in order to meet the inventory needs of the Company's expanding
retail store network.
The Company currently estimates that its aggregate capital
expenditures in 1996 and 1997 will approximate up to $90 million,
including the $60 million estimated for the construction of the
new distribution facility, expansion of its retail store network
(including initial investments in inventory) and for expansion of
its international operations. In each of these cases, there can
be no assurance that the Company's capital expenditures will not
exceed this estimated amount.
SEASONALITY AND QUARTERLY FLUCTUATIONS
--------------------------------------
Historically, the Company's operations have been seasonal,
with higher sales and net income occurring in the third and
fourth quarters, reflecting increased demand during the year-end
holiday selling season. Since the biggest retail selling season
is the year-end holiday season, and as more of the Company's
principal department store customers adopt electronic data
interchange which allows them to defer shipments until later in
the selling season, future sales are expected to be more heavily
weighted toward the third and fourth quarters. In addition, the
Company's retail stores experience a seasonal selling pattern
similar to that of department stores although, in the case of the
Company, sales are more heavily weighted toward the fourth
quarter. As a result, as the Company increases the number of
stores, the shift of sales volume toward the latter part of the
year is expected to continue.
The Company's results of operations may also fluctuate from
quarter to quarter in the future as a result of the amount and
timing of sales contributed by, and expenses related to the
Page 15 of 20 <PAGE>
opening of, new retail stores and the integration of such stores
into the operations of the Company, as well as other factors.
The addition of a significant number of retail stores, as is
anticipated with the Company's store expansion program, can
therefore significantly affect results of operations on a
quarter-to-quarter basis.
FORWARD-LOOKING INFORMATION
---------------------------
Certain statements or assumptions in Management's Discussion
and Analysis contain or are based on "forward-looking"
information (as defined in the Private Securities Litigation and
Reform Act of 1995) that involves risk and uncertainties inherent
in the Company's business. Actual outcomes are dependent upon
the Company's successful performance of internal plans, its
ability to control inventory levels, customer changes in short
range and long range plans, domestic and international
competition in the Company's product areas, successful completion
of construction within current cost estimates, continued
acceptance of existing products and the development and
acceptance of new products, performance issues with key
suppliers, changes in government import and export policies,
risks related to international transactions and hedging
strategies, as well as general economic risks and uncertainties.
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
------- ---------------------------------------------------
At the Company's Annual Meeting of Stockholders held on
May 29, 1996, the following members were re-elected to the Board
of Directors:
Raymond B. Dingman
Norman R. Higo
Michael Lax
Page 16 of 20 <PAGE>
<TABLE>The following proposals were approved at the Company's Annual Meeting:
<CAPTION>
<S> <C> <C> <C>
Votes Against or
For Withheld Abstentions
---------- ---------- -----------
1. Re-election of three of its
directors to the Board of
Directors
Raymond B. Dingman 19,913,405 16,423
Norman R. Higo 19,913,505 16,323
Michael Lax 19,913,405 16,423
2. Ratification of appointment of
Coopers & Lybrand L.L.P. as
independent accountants for
the 1996 fiscal year 19,926,997 1,677 1,154
There were no broker non-votes with respect to Items 1 and 2 above.
</TABLE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
------ --------------------------------
(a) Exhibits
(27) Financial Data Schedule
(b) Reports on Form 8-K
None.
Page 17 of 20 <PAGE>
SIGNATURES
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.
MIKASA, INC.
(Registrant)
Date: August __, 1996 /s/ Raymond B. Dingman
-------------------------------------
Raymond B. Dingman
President and Chief Operating Officer
/s/ Brenda W. Flores
-------------------------------------
Brenda W. Flores
Vice President and Chief Financial
Officer
(Principal Financial and
Accounting Officer)
Page 18 of 20 <PAGE>
EXHIBIT INDEX
-------------
Exhibit
No. Description Page
---------------------------------------------------------------
27 Financial Data Schedule 20
Page 19 of 20 <PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 44,708
<SECURITIES> 0
<RECEIVABLES> 23,236
<ALLOWANCES> 567
<INVENTORY> 164,012
<CURRENT-ASSETS> 237,955
<PP&E> 68,820
<DEPRECIATION> 21,058
<TOTAL-ASSETS> 291,681
<CURRENT-LIABILITIES> 30,201
<BONDS> 60,000
0
0
<COMMON> 22,280
<OTHER-SE> 150,484
<TOTAL-LIABILITY-AND-EQUITY> 291,681
<SALES> 145,696
<TOTAL-REVENUES> 145,696
<CGS> 80,560
<TOTAL-COSTS> 140,625
<OTHER-EXPENSES> 4,100
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 551
<INCOME-PRETAX> 420
<INCOME-TAX> 166
<INCOME-CONTINUING> 254
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 254
<EPS-PRIMARY> 0.01
<EPS-DILUTED> 0.01
</TABLE>
