<PAGE>
FORM 10-Q
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
[*] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended August 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _____________ to ______________
Commission File Numbers: 33-87930, 33-87930-0, 333-18475
ICON Health & Fitness, Inc.
IHF Holdings, Inc.
ICON Fitness Corporation
(Exact name of registrant as specified in its charter)
Delaware 87-0531206, 87-0531209, 87-0566936
(State or other jurisdiction of (I.R.S. Employer Identification Nos.)
incorporation or organization)
1500 South 1000 West Logan, Utah 84321
(Address and zip code of principal executive offices)
(801) 750-5000
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year,
if change since last report)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (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
--- ---
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a
plan confirmed by a court. Yes No
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date:
ICON Health & Fitness, Inc. 1,000 shares,
IHF Holdings, Inc. 1,000 shares,
ICON Fitness Corporation 100 shares.<PAGE>
<PAGE>
ICON Fitness Corporation
and its wholly-owned subsidiary, IHF Holdings, Inc.
and its wholly-owned subsidiary, ICON Health & Fitness, Inc.
FORM 10-Q INDEX
Page No.
--------
PART I - FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . 3
Item 1. Financial Statements . . . . . . . . . . . . . . . . . . . . . 3-6
Consolidated Condensed Balance
Sheets as of August 30, 1997 and
May 31, 1997 . . . . . . . . . . . . . . . . . . . . . . . . . 3-4
Consolidated Condensed Statements
of Operations for the three months
ended August 30, 1997 and August 31, 1996 . . . . . . . . . . . 5
Consolidated Condensed Statements
of Cash Flows for the three months
ended August 30, 1997 and August 31, 1996 . . . . . . . . . . . 6
Notes to Consolidated Condensed
Financial Statements . . . . . . . . . . . . . . . . . . . . . . 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations . . . . . . . . . . . . . . . . . . . . . . . . . 7-10
PART II - OTHER INFORMATION . . . . . . . . . . . . . . . . . . . . . . 10
Item 1. Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . 10
Item 2. Changes in Securities . . . . . . . . . . . . . . . . . . . . 10
Item 3. Defaults Upon Senior Securities . . . . . . . . . . . . . . . 10
Item 4. Submission of Matters to a Vote of Securities Holders . . . . 11
Item 5. Other Information . . . . . . . . . . . . . . . . . . . . . . 11
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . 11
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
<PAGE>
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements
ICON Fitness Corporation and its wholly-owned subsidiary,
IHF Holdings, Inc. and its wholly-owned subsidiary,
ICON Health & Fitness, Inc.
CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited)
(In Thousands)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
ICON Fitness IHF ICON Health ICON Fitness IHF Holding, ICON Health
Corporation Holdings, Inc. & Fitness, Inc. Corporation Inc. &Fitness,Inc.
August 30, August 30, August 30, May 31, 1997 May 31,1997 May 31,1997
1997 1997 1997
____________ ______________ _______________ ____________ ____________ ____________
Assets
Current assets
Cash $5,671 $5,671 $5,671 $5,560 $5,560 $5,560
Accounts receivable-net 143,706 143,706 143,706 192,825 192,825 192,825
Inventories:
Raw materials 36,747 36,747 36,747 27,974 27,974 27,974
Finished goods 125,322 125,322 125,322 93,864 93,864 93,864
Deferred income taxes 14,919 14,777 14,409 8,401 8,301 8,006
Other current assets 10,595 10,595 10,595 12,895 12,895 12,895
Asset held for sale 17,080 17,080 17,080 17,080 17,080 17,080
Income tax receivable 7,440 7,440 7,440 7,429 7,429 7,429
------- ------- ------- ------- ------- -------
Total current assets 361,480 361,338 360,970 366,028 365,928 365,633
Property and equipment
Land 2,371 2,371 2,371 2,371 2,371 2,371
Building 17,130 17,130 17,130 17,391 17,391 17,391
Machinery and equipment 61,904 61,904 61,904 59,318 59,318 59,318
------- ------- ------- -------- -------- --------
Total 81,405 81,405 81,405 79,080 79,080 79,080
Less:accum depreciation (30,817) (30,817) (30,817) (27,342) (27,342) (27,342)
-------- -------- -------- -------- -------- --------
Property & equipment-net 50,588 50,588 50,588 51,738 51,738 51,738
Receivable from parent 2,307 2,307 2,307 2,307 2,307 2,307
Trademarks,ne 18,024 18,024 18,024 18,236 18,236 18,236
Deferred income taxes 10,587 7,622 8,338 6,405 --
Other assets 30,516 26,594 21,910 28,157 24,066 19,029
-------- -------- -------- -------- --------
Total assets $473,502 $466,473 $453,799 $474,804 $468,680 $456,943
======== ======== ======== ======== ======== ========
</TABLE>
See notes to consolidated condensed financial statements.
<PAGE>
ICON Fitness Corporation and its wholly-owned subsidiary,
IHF Holdings, Inc. and its wholly-owned subsidiary,
ICON Health & Fitness, Inc.
CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited) (Continued)
(In Thousands)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
ICON Fitness IHF ICON Health ICON Fitness IHF Holding, ICON Health
Corporation Holdings, Inc. & Fitness, Inc. Corporation Inc. &Fitness,Inc.
August 30, August 30, August 30, May 31, 1997 May 31,1997 May 31,1997
1997 1997 1997
____________ ______________ _______________ ____________ ____________ _____________
Liabilities and
Stockholders' Equity
(Deficit)
Current liabilities
Current portion of
long-term debt $5,607 $5,607 $5,607 $5,401 $5,401 $5,401
Accounts payable 117,850 117,850 117,850 112,079 112,079 112,079
Interest payable 2,668 2,668 2,668 6,220 6,220 6,220
Accrued expenses 19,995 19,995 19,995 20,696 20,696 20,696
Income taxes payable 1,641 1,641 1,641 1,165 1,165 1,165
------- ------- ------- ------- ------- -------
Total current liabilities 147,761 147,761 147,761 145,561 145,561 145,561
Long term-debt 499,760 408,532 325,875 489,400 401,196 321,625
Deferred income taxes -- -- 245 -- -- 501
Other liabilities 1,464 1,464 1,464 -- -- --
Stockholders' equity (deficit)
Common stock & additional
paid-in capital 49,698 127,767 166,184 49,699 127,767 166,184
Receivable from officers
for purchase of equity (656) (656) (656) (656) (656) (656)
Cumulative translation
adjustment (389) (389) (389) (506) (506) (506)
Retained earnings(deficit) (224,136) (218,006) (186,685) (208,694) (204,682) (175,766)
--------- --------- --------- --------- --------- ---------
Total Stockholders' Equity (175,483) (91,284) (21,546) (160,157) (78,077) (10,744)
--------- --------- --------- --------- --------- ---------
Total liabilities and
stockholders' equity $473,502 $466,473 $453,799 $474,804 $468,680 $456,943
========== ========== ========== ========== ========== ==========
</TABLE>
See notes to consolidated condensed financial statements.
<PAGE>
ICON Fitness Corporation and its wholly-owned subsidiary,
IHF Holdings, Inc. and its wholly-owned subsidiary,
ICON Health & Fitness, Inc.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (Unaudited)
(In Thousands)
<TABLE>
<CAPTION> For The Three Months Ended
<S> <C> <C> <C> <C> <C> <C>
ICON Fitness IHF ICON Health ICON Fitness IHF Holding, ICON Health
Corporation Holdings, Inc. & Fitness, Inc. Corporation Inc. &Fitness,Inc.
August 30, August 30, August 30, August 31, August 31, August 31,
1997 1997 1997 1996 1996 1996
____________ ______________ _______________ ____________ ____________ _____________
Net sales $127,482 $127,482 $127,482 $125,810 $125,810 $125,810
Cost of goods sold 92,334 92,334 92,334 90,581 90,581 90,581
Cost of goods sold-
revaluation of HealthRider,
Weider Sports and CanCo
inventory 326 326 326 1,865 1,865 1,865
-------- -------- -------- --------- ------- -------
Gross profit 34,822 34,822 34,822 33,364 33,364 33,364
-------- -------- -------- --------- ------- -------
Operating expenses:
Selling expenses 26,645 26,645 26,645 18,813 18,813 18,813
Research and development 1,920 1,920 1,920 1,639 1,639 1,639
General and administrative 13,837 13,837 13,837 10,887 10,887 10,887
------ ------ ------ ------ ------ ------
Total operating expenses 42,402 42,402 42,402 31,339 31,339 31,339
------ ------ ------ ------ ------ ------
Operating income (loss) (7,580) (7,580) (7,580) 2,025 2,025 2,025
Interest expense 14,591 11,569 8,482 8,773 8,773 6,167
Dividend on cumulative
redeemable preferred
stock of Subsidiary -- -- -- 1,275 -- --
Amortization of deferred
financing fees 1,758 1,588 1,236 949 949 652
-------- -------- -------- ------- -------- --------
Loss before income tax (23,929) (20,737) (17,298) (8,972) (7,697) (4,794)
Benefit from income taxes (8,487) (7,413) (6,379) (1,875) (1,875) (1,173)
--------- --------- --------- -------- -------- --------
Net loss ($15,442) ($13,324) ($10,919) ($7,097) ($5,822) ($3,621)
========= ========= ========= ======== ======== ========
</TABLE>
See notes to consolidated condensed financial statements.
<PAGE>
ICON Fitness Corporation and its wholly-owned subsidiary,
IHF Holdings, Inc. and its wholly-owned subsidiary,
ICON Health & Fitness, Inc.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)
(In Thousands)
<TABLE>
<CAPTION> For The Three Months Ended
<S> <C> <C> <C> <C> <C> <C>
ICON Fitness IHF ICON Health ICON Fitness IHF Holding, ICON Health
Corporation Holdings, Inc. & Fitness, Inc. Corporation Inc. &Fitness,Inc.
August 30, August 30, August 30, August 31, August 31, August 31,
1997 1997 1997 1996 1996 1996
____________ ______________ _______________ ____________ ____________ _____________
OPERATING ACTIVITIES:
Net income/(loss) ($15,442) ($13,324) ($10,919) ($7,097) ($5,822) ($3,621)
Adjustments to reconcile net
income to net cash provided
by operating activity:
Provision for bad debt and
advertising allowance 4,641 4,641 4,641 2,792 2,792 2,792
Provision/(benefit)for
deferred taxes (8,767) (7,693) (6,659) (140) (140) --
Amortization of debt
discount and deferred
financing fees 7,944 4,752 1,313 3,607 3,607 703
Depreciation & amortization 3,966 3,966 3,966 2,284 2,284 2,284
Inventory revaluation 326 326 326 -- -- --
Interest expense attributable
to dividends on preferred
stock -- -- -- 1,275 -- --
Changes in operating assets
and liabilities:
Accounts receivable 44,556 44,556 44,556 9,360 9,360 9,360
Inventory (40,558) (40,558) (40,558) (37,004) (37,004) (37,004)
Other assets (2,166) (2,166) (2,166) 387 387 950
Account payable and
accrued expenses 3,441 3,441 3,441 (7,079) (7,079) (7,079)
-------- -------- -------- -------- -------- --------
Net cash received from/(used in)
operating activities (2,059) (2,059) (2,059) (31,615) (31,615) (31,615)
INVESTING ACTIVITIES:
Payments for acquisitions -- -- -- (28,203) (28,203) (28,203)
Purchases of property
and equipment (2,325) (2,325) (2,325) (6,598) (6,598) (6,598)
------- ------- ------- -------- -------- --------
Net cash received from /(used in)
investing activities (2,325) (2,325) (2,325) (34,801) (34,801) (34,801)
------- ------- ------- -------- -------- --------
FINANCING ACTIVITIES:
Proceeds from long-term debt,
net of payments 4,378 4,378 4,378 51,924 51,924 51,924
----- ----- ----- ------ -------- --------
Net cash received from/
(used in) financing
activities 4,378 4,378 4,378 51,924 51,924 51,924
----- ----- ----- ------ -------- --------
Effect of exchange rate
change on cash 117 117 117 (234) (234) (234)
----- ----- ----- -------- -------- --------
Net increase/(decrease)in cash 111 111 111 (14,726) (14,726) (14,726)
Cash at beginning of period 5,560 5,560 5,560 19,313 19,313 19,313
------ ------ ------ -------- -------- --------
Cash at end of period $5,671 $5,671 $5,671 $4,587 $4,587 $4,587
====== ====== ====== ====== ======== ========
SUPPLEMENTAL DISCLOSURES:
Cash paid (received)
during the year for:
Interest $11,481 $11,481 $11,481 $9,073 $9,073 $9,073
Income taxes ($174) ($174) ($174) $35 $35 $35
</TABLE>
See notes to consolidated condensed financial statements. <PAGE>
<PAGE>
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
Basis of Presentation
IHF Holdings, Inc. ("IHF Holdings") is a holding company whose principal
asset is all of the capital stock of ICON Health & Fitness, Inc. ("ICON
Health"). ICON Fitness Corporation ("ICON Fitness") is a holding company
whose principal asset is all of the capital stock of IHF Holdings. IHF
Capital, Inc. ("IHF Capital") which is not a registrant, is a holding
company whose principal asset is all of the common stock of IHF Fitness.
Unless the context requires otherwise, all references herein to the
"Company" refer to the combined operations of the companies.
The accompanying consolidated condensed financial statements and notes
should be read in conjunction with the financial statements contained in
the Company's Annual Report on Form 10-K. In the opinion of management, the
accompanying consolidated condensed financial statements include all
adjustments necessary for a fair presentation of the results of the interim
periods presented and all such adjustments are of a normal recurring
nature. The home fitness industry is seasonal in nature and the results of
operations for the interim periods presented may not be indicative of the
results for the full year.
The preparation of consolidated financial statements in accordance with
generally accepted accounting principles requires the Company to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingencies at the date of the consolidated
financial statements and the reported amount of revenues and expenses
during the period. Actual results could differ from those estimates.
Item 2 Management's Discussion and Analysis of Financial Condition and
Results of Operations.
This Quarterly Report on Form 10-Q contains forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934. For this purpose, any
statements contained herein that are not statements of historical fact may
be deemed to be forward-looking statements. Without limiting the foregoing,
the words, "believes," "anticipates," "plans," "expects," "intends" and
similar expressions are intended to identify forward-looking statements.
The Company's actual results could differ materially from those set forth
in the forward-looking statements.
Seasonality
The Company has historically sold the majority of its products to customers
in its second and third fiscal quarters (i.e., from September through
February). Increased sales and distribution typically have occurred in the
Christmas retail season and the beginning of a new calendar year because of
increased customer promotions and customer purchases. While this
seasonality has been the trend, it may not be indicative of the results to
be expected for this fiscal year or any future years. The following table
reflects the Company's net sales for the first quarter of fiscal 1998 and
for each quarter in fiscal 1997 and fiscal 1996.
<PAGE>
First Second Third Fourth
Quarter Quarter Quarter Quarter
------- ------- ------- -------
Fiscal 1998 $127.5 -- -- --
Fiscal 1997 $125.8 $249.5 $248.7 $212.2
Fiscal 1996 $124.8 $228.5 $240.9 $153.4
Operating Results for the First Quarters of 1998 and 1997
---------------------------------------------------------
Net sales were $127.5 million in the first quarter of fiscal 1998, compared
to $125.8 million in the first quarter of fiscal 1997. Domestic treadmill
sales increased $23.8 million in the first quarter of fiscal 1998 to $67.3
million compared to $43.5 million in the first quarter of fiscal 1997.
Domestic treadmill sales accounted for approximately 52.8% and 34.6% of
total net sales during the first quarter of fiscal 1998 and 1997. Sales of
the Company's line of upright rowers decreased $19.4 million to $1.6
million from $21.0 million in the first quarter of 1997. Sales of
trampolines decreased $4.3 million in the first quarter of 1998 to $13.1
million from $17.4 million in the first quarter of fiscal 1997. The
Company has introduced several new products which include Airwalkers, home
spas, relaxation chairs and elliptical products which generated $7.0
million of sales in the first quarter of fiscal 1998 compared to $.8
million in the first quarter of fiscal 1997.
Gross profit for the first quarter of fiscal 1998 was $34.8 million, or
27.3% of net sales, compared to $33.4 million, or 26.6% of net sales, for
the first quarter of fiscal 1997. The step-up of HealthRider inventory
increased cost of sales by $.3 million in the first quarter of fiscal 1998
and $1.9 million in the first quarter of fiscal 1997. Without these
charges, the gross profit would have been 27.5%, and 28.1% for the first
quarter of fiscal 1998 and 1997 respectively. This decrease is attributed
to the changes in product mix.
Selling expenses were $26.6 million, or 20.9% of net sales, in the first
quarter of fiscal 1998 compared to $18.8 million, or 14.9% of net sales,
for the first quarter of fiscal 1997. This increase of $7.8 million over
the same period last year is primarily due to the increase of selling
expenses of HealthRider from $2.5 million for two weeks of operation
included in the first quarter of 1997 to $5.5 million for the first quarter
of fiscal 1998. Other increases include freight charges of $1.8 million,
customer service and warranty expenses of $1.2 million and bad debt
expenses of $1.0 million.
Research and development expenses were $1.9 million or 1.5% of net sales,
for the first quarter of 1998 compared to $1.6 million, or 1.3% of net
sales, for the first quarter 1997.
General and administrative expenses totaled $13.8 million, or 10.8% of net
sales, for the first quarter of 1998 compared to $10.9 million, or 8.7% of
net sales, for the first quarter of 1997. This increase in general and
administrative expenses as a percentage of sales can be attributed in part
to the inclusion of the operating results of HealthRider and ICON of Canada
for the entire first quarter of fiscal 1998. These costs were $.4 million
<PAGE>
for the first quarter of 1997 compared to $1.5 for the first quarter of
1998. The balance of $1.8 million is due to the higher costs associated
with operating the Company's business.
As a result of the foregoing factors, the operating loss was $7.6 million
in the first quarter of fiscal 1998, compared to operating income of $2.0
million in the first quarter of fiscal 1997.
Interest expense, including amortization of deferred financing fees, was
$9.7 million for ICON Health, $13.2 million for IHF Holdings and $16.3
million for ICON Fitness in the first quarter of fiscal 1998 compared to
$6.8 million for ICON Health and $9.7 million for IHF Holdings and ICON
Fitness for the first quarter of fiscal 1997. In the first quarter of
fisal 1997, ICON Fitness recorded an additional $1.3 million of interest
expense related to dividends accruing on the IHF Holdings preferred stock
issued in connection with the Recapitalization and which was held by
affiliates of the Company. The IHF Holdings preferred stock was redeemed
with the proceeds of the 14% Series A Senior Secured Discount Notes issued
in November 1996. Interest expense has increased due to the interest
associated with these Senior Discount Notes, the Company's growth and the
high level of borrowing incurred in connection with the HealthRider
Acquisition, the WHF Settlement the Weider Sports and CanCo Acquisitions.
The income tax benefit was $6.4 million for ICON Health, $7.4 million for
IHF Holdings, and $8.5 million for ICON Fitness for the first quarter of
1998 compared with a tax benefit of $1.2 million for ICON Health and a tax
benefit of $1.9 million for IHF Holdings and ICON Fitness during the first
quarter of fiscal 1997. This is a result of the increase in the loss
before income tax during the first quarter of 1998 compared to the same
period in the preceding year.
As a result of the foregoing factors, the net operating loss was $10.9
million for ICON Health and $13.3 million for IHF Holdings and $15.4
million for ICON Fitness for the first quarter of 1998 compared to net
operating loss of $3.6 million for ICON Health, $5.8 million for IHF
Holdings and $7.1 million for ICON Fitness during the same period for
fiscal 1997.
Advertising allowances with retail customers have increased by $3.2 million
to $6.1 million at August 30, 1997 from $2.9 million at May 31, 1997.
Advertising allowances are generally a fixed percentage of sales to
customers. Fluctuations in the balance of this allowance are attributable
to changes in customer sales mix and the timing of when allowances are
taken.
Bad debt allowances totaled $3.3 million at August 30, 1997 compared to
$2.6 at May 31, 1997. This increase in the allowance is primarily due to
additional amounts allocated to the Montgomery Ward provision. Montgomery
Ward recently filed for protection under Chapter 11 of the Bankruptcy Code.
Terms with retail customers remained unchanged from previous periods.
<PAGE>
Liquidity and Capital Resources
-------------------------------
As a result of the Company's Recapitalization on November 14, 1994, the
Company's cash needs have changed significantly. Management believes that
cash flows from operations and ICON Health's ability to make revolving
credit borrowings under the amended Credit Agreement will provide adequate
funds for working capital, planned capital expenditures and debt service
obligations for the foreseeable future. Nevertheless, the Company is
highly leveraged, and the ability to fund operations, make planned capital
expenditures, make scheduled debt payments and refinance indebtedness
depends on future operating performance and cash flows, which in turn, are
subject to prevailing economic conditions and to financial, business and
other factors, some of which are beyond the Company's control.
In the first three months of fiscal 1998, the Company used $2.1 million of
cash in operating activities primarily as a result of increased inventory
in preparation of the Company's peak selling season. During the first three
months of fiscal 1998, the Company had a net increase in cash of $.1
million. The Company also used $2.3 million of cash in the first three
months of fiscal 1998 for capital expenditures primarily related to tooling
and manufacturing equipment.
At August 30, 1997, ICON Health had $184.5 million of revolving credit
borrowings under the Credit Agreement. At the close of the quarter
additional availability under this Credit Agreement was $16.4 million.
Management believes that availability under this amended Credit Agreement
is adequate to meet the Company's obligations. The revolving credit
borrowings have increased by $5.7 million from $178.8 million reported at
the end of fiscal 1997. Line of Credit borrowings have historically been
used to fund increased inventory levels, finance normal trade credit for
customers, finance acquisitions, make interest payment on debt issued in
connection with the Company's Recapitalization and to fund capital
expenditures.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
The Company is party to a variety of non-product liability commercial suits
involving contract claims and intellectual property claims. The Company
believes that potential adverse resolution of these suits will not have a
material adverse effect on the Company. The Company is also involved in
several patent infringement claims, arising in the ordinary course of its
business. The Company believes that the ultimate outcome of these matters
will not have a material adverse effect on the Company.
Item 2. Changes in Securities.
None.
Item 3. Defaults Upon Senior Securities.
None.
<PAGE>
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
Exhibits.
27.1 Financial Data Scheduled for ICON Fitness Corporation
27.2 Financial Data Schedule for IHF Holdings, Inc.
27.3 Financial Data Schedule for ICON Health & Fitness, Inc.
Reports on Form 8-K.
None.
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 of the
undersigned thereunto duly authorized.
ICON Fitness Corporation
IHF Holdings,Inc.
ICON Health & Fitness, Inc.
(Registrants)
Date: October 14, 1997
_________________ By /s/ Gary Stevenson
________________________________
Gary Stevenson, President
By /s/ S. Fred Beck
______________________________________
S. Fred Beck, Chief Accounting Officer
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
SCHEDULE 27.1
This schedule contains summary financial information extracted from the
August 30, 1997 Financial Statements included in the Company's Form 10-Q and
is qualified in its entirety by reference to such Form 10-Q.
</LEGEND>
<CIK> 0001029294
<NAME> ICON Health Fitness Corporation
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAY-31-1998
<PERIOD-START> JUN-01-1997
<PERIOD-END> AUG-30-1997
<CASH> 5671
<SECURITIES> 0
<RECEIVABLES> 156498
<ALLOWANCES> 12792
<INVENTORY> 162069
<CURRENT-ASSETS> 361480
<PP&E> 81405
<DEPRECIATION> 30817
<TOTAL-ASSETS> 473502
<CURRENT-LIABILITIES> 147761
<BONDS> 499760
0
0
<COMMON> 49698
<OTHER-SE> (225181)
<TOTAL-LIABILITY-AND-EQUITY> 473502
<SALES> 127482
<TOTAL-REVENUES> 127482
<CGS> 92660
<TOTAL-COSTS> 42402
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 14591
<INCOME-PRETAX> (23929)
<INCOME-TAX> (8487)
<INCOME-CONTINUING> (15442)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (15442)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
SCHEDULE 27.2
This schedule contains summary financial information extracted from the
August 30, 1997 Financial Statements included in the Company's Form 10-Q and
is qualified in its entirety by reference to such Form 10-Q.
</LEGEND>
<CIK> 0000934799
<NAME> IHF Holdings Inc
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAY-31-1998
<PERIOD-START> JUN-01-1997
<PERIOD-END> AUG-30-1997
<CASH> 5671
<SECURITIES> 0
<RECEIVABLES> 156498
<ALLOWANCES> 12792
<INVENTORY> 162069
<CURRENT-ASSETS> 361338
<PP&E> 81405
<DEPRECIATION> 30817
<TOTAL-ASSETS> 466473
<CURRENT-LIABILITIES> 147761
<BONDS> 408532
0
0
<COMMON> 127767
<OTHER-SE> (219051)
<TOTAL-LIABILITY-AND-EQUITY> 466473
<SALES> 127482
<TOTAL-REVENUES> 127482
<CGS> 92660
<TOTAL-COSTS> 42402
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 11569
<INCOME-PRETAX> (20737)
<INCOME-TAX> (7413)
<INCOME-CONTINUING> (13324)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (13324)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
SCHEDULE 27.3
This schedule contains summary financial information extracted from the
August 30, 1997 Financial Statements included in the Company's Form 10-Q and
is qualified in its entirety by reference to such Form 10-Q.
</LEGEND>
<CIK> 0000934798
<NAME> ICON Health & Fitness Inc
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAY-31-1998
<PERIOD-START> JUN-01-1997
<PERIOD-END> AUG-30-1997
<CASH> 5671
<SECURITIES> 0
<RECEIVABLES> 156498
<ALLOWANCES> 12792
<INVENTORY> 162069
<CURRENT-ASSETS> 360970
<PP&E> 81405
<DEPRECIATION> 30817
<TOTAL-ASSETS> 453799
<CURRENT-LIABILITIES> 147761
<BONDS> 325875
0
0
<COMMON> 166184
<OTHER-SE> (187730)
<TOTAL-LIABILITY-AND-EQUITY> 453799
<SALES> 127482
<TOTAL-REVENUES> 127482
<CGS> 92660
<TOTAL-COSTS> 42402
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 8482
<INCOME-PRETAX> (17298)
<INCOME-TAX> (6374)
<INCOME-CONTINUING> (10919)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (10919)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
