<PAGE> 1
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 September 2, 2000 or
( ) Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the transition period from __________________ to _______________________
Commission file number 0-6708
Nautica Enterprises, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 95-2431048
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
40 West 57th Street, New York, N.Y. 10019
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code (212) 541-5757
(Former Name, Former Address and Former Fiscal Year,
if Changed Since Last Report)
Indicate by check mark whether the registrant: (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (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 Section 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court
Yes ____ No ____
APPLICABLE ONLY TO CORPORATE ISSUERS
The number of shares of Common Stock outstanding as of October 12, 2000
was 31,621,371.
<PAGE> 2
NAUTICA ENTERPRISES, INC. AND SUBSIDIARIES
SEPTEMBER 2, 2000
(unaudited)
INDEX
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
Part I - Financial Information:
Item 1. Financial Statements (unaudited):
Condensed Consolidated Balance Sheets
As at September 2, 2000 and March 4, 2000 ........................ 2
Condensed Consolidated Statements of Earnings
For the Six and Three Month Periods Ended
September 2, 2000 and August 28, 1999 .......................... 3
Condensed Consolidated Statements of Cash Flows
For the Six Month Periods Ended
September 2, 2000 and August 28, 1999 .......................... 4
Notes to Condensed Consolidated Financial Statements .............. 5
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations ........... 8
Item 3. Quantitative and Qualitative Disclosures About Market Risk 11
Part II - Other Information ................................................ 12
</TABLE>
<PAGE> 3
NAUTICA ENTERPRISES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in thousands, except share data)
<TABLE>
<CAPTION>
ASSETS (unaudited)
September 2, March 4,
2000 2000
------------ ---------
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 29,750 $ 27,143
Short-term investments 5,340 33,991
Accounts receivable - net 108,647 88,784
Inventories 103,844 73,879
Prepaid expenses and other current assets 3,811 5,453
Deferred tax benefit 8,381 8,381
--------- ---------
Total current assets 259,773 237,631
Property, plant and equipment, net of
accumulated depreciation and amortization 80,012 81,674
Other assets 15,927 13,808
--------- ---------
$ 355,712 $ 333,113
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable - trade $ 57,989 $ 29,048
Accrued expenses and other current liabilities 33,555 30,559
Income taxes payable 12,369 9,793
--------- ---------
Total current liabilities 103,913 69,400
Stockholders' equity:
Preferred stock - par value $.01; authorized,
2,000,000 shares; no shares issued
Common stock - par value $.10; authorized, 100,000,000 shares; issued
43,112,000 shares at September 2, 2000 and 42,696,000 shares at
March 4, 2000 4,312 4,270
Additional paid-in capital 67,918 67,559
Retained earnings 338,552 322,045
--------- ---------
410,782 393,874
Less:
Common stock in treasury - at cost;
11,498,000 shares at September 2, 2000
and 8,964,000 shares at March 4, 2000 (158,983) (130,161)
--------- ---------
Total stockholders' equity 251,799 263,713
--------- ---------
$ 355,712 $ 333,113
========= =========
</TABLE>
The accompanying notes are an integral part of these statements.
-2-
<PAGE> 4
NAUTICA ENTERPRISES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(amounts in thousands, except share data)
<TABLE>
<CAPTION>
(unaudited) (unaudited)
Six Months Six Months Three Months Three Months
Ended Ended Ended Ended
September 2, 2000 August 28, 1999 September 2, 2000 August 28, 1999
------------------ --------------- ----------------- ---------------
<S> <C> <C> <C> <C>
Net Sales $ 290,601 $ 251,489 $ 169,409 $ 152,191
Cost of goods sold 170,545 145,272 99,534 87,413
------------ ------------ ------------ ------------
Gross profit 120,056 106,217 69,875 64,778
Selling, general and administrative expenses 98,232 79,663 50,762 43,424
Net royalty income (3,697) (2,841) (1,910) (1,424)
------------ ------------ ------------ ------------
Operating profit 25,521 29,395 21,023 22,778
Other expense (13) -- (13) --
Investment income, net 1,463 848 905 288
------------ ------------ ------------ ------------
Earnings before provision for income taxes 26,971 30,243 21,915 23,066
Provision for income taxes 10,465 11,855 8,503 9,042
------------ ------------ ------------ ------------
NET EARNINGS $ 16,506 $ 18,388 $ 13,412 $ 14,024
============ ============ ============ ============
Net earnings per share of common stock
Basic $ 0.51 $ 0.53 $ 0.43 $ 0.41
============ ============ ============ ============
Diluted $ 0.50 $ 0.50 $ 0.41 $ 0.38
============ ============ ============ ============
Weighted average number of
common shares outstanding
Basic 32,054,000 35,002,000 31,415,000 34,599,000
============ ============ ============ ============
Diluted 33,302,000 36,963,000 32,538,000 36,745,000
============ ============ ============ ============
Cash dividends per common share none none none none
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these statements.
-3-
<PAGE> 5
NAUTICA ENTERPRISES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in thousands)
<TABLE>
<CAPTION>
(unaudited)
Six Months Six Months
Ended Ended
September 2, 2000 August 28, 1999
----------------- ----------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings $ 16,506 $ 18,388
-------- --------
Adjustments to reconcile net earnings to net cash
provided by operating activities:
Deferred income taxes -- (231)
Depreciation and amortization 11,202 8,891
Provision for bad debts 514 603
Changes in operating assets and liabilities
Accounts receivable (20,377) (12,020)
Inventories (29,965) (14,329)
Prepaid expenses and other current assets 1,642 398
Other assets (2,553) (2,642)
Accounts payable - trade 28,941 3,994
Accrued expenses and other current liabilities 2,996 6,390
Income taxes payable 2,576 4,700
-------- --------
Total adjustments (5,024) (4,246)
-------- --------
Net cash provided by operating activities 11,482 14,142
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment (9,105) (15,735)
Sale of short-term investments 28,650 26,201
-------- --------
Net cash provided by investing activities 19,545 10,466
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Principal payments on long-term debt -- (100)
Purchase of treasury stock (28,822) (29,460)
Proceeds from issuance of common stock 402 339
-------- --------
Net cash used in financing activities (28,420) (29,221)
-------- --------
Increase/Decrease in cash and cash equivalents 2,607 (4,613)
Cash and cash equivalents at beginning of period 27,143 15,498
-------- --------
Cash and cash equivalents at end of period $ 29,750 $ 10,885
======== ========
Supplemental disclosure of cash flow information:
Cash paid during the period for income taxes $ 8,048 $ 7,135
======== ========
</TABLE>
The accompanying notes are an integral part of these statements.
-4-
<PAGE> 6
NAUTICA ENTERPRISES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 2, 2000
(unaudited)
(amounts in thousands)
NOTE 1 - The accompanying financial statements have been prepared
without audit pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations. These
statements include all adjustments, consisting only of normal
recurring accruals, considered necessary for a fair presentation of
financial position and results of operations. The financial
statements included herein should be read in conjunction with the
financial statements and notes thereto included in the latest annual
report on Form 10-K.
NOTE 2 - The results of operations for the six-month period ended
September 2, 2000 are not necessarily indicative of the results to
be expected for the full year.
NOTE 3 - During the six months ended September 2, 2000, the Company
changed its presentation of markdowns and promotional allowances
from a selling expense to a reduction of sales in an effort to be
consistent with industry-wide reporting practices. In addition, the
reserve for markdowns and promotional allowances has been
reclassified from accrued expenses to a reduction of accounts
receivable. Previously reported amounts have been reclassified to
conform with the current year's presentation. This change in
presentation has no impact on operating profit, earnings before
provision for income taxes or net earnings.
NOTE 4 - The Company utilized the last-in, first-out "LIFO" method for
certain wholesale inventories as at September 2, 2000 and March 4,
2000 and for the six and three month periods ended September 2, 2000
and August 28, 1999. The "LIFO" inventory for the six month periods
ended September 2, 2000 and August 28, 1999 are based upon end of
year estimates. Inventories at September 2, 2000 and March 4, 2000
consist primarily of finished goods.
NOTE 5 - The Company has adopted Statement of Financial Accounting
Standards No. 130 ("SFAS No. 130), "Reporting Comprehensive Income."
SFAS No. 130 establishes standards for reporting comprehensive
income and its components in a financial statement. Comprehensive
income as defined includes all changes in equity during a period
from non-owner sources, as follows:
<TABLE>
<CAPTION>
Six Six Three Three
Months Ended Months Ended Months Ended Months Ended
September 2, August 28, September 2, August 28,
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net earnings $16,506 $18,388 $13,412 $14,024
Changes in unrealized gains
and losses on securities,
net of tax -- (166) -- (61)
------- ------- ------- -------
Comprehensive Income $16,506 $18,222 $13,412 $13,963
======= ======= ======= =======
</TABLE>
-5-
<PAGE> 7
NAUTICA ENTERPRISES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
SEPTEMBER 2, 2000
(unaudited)
(amounts in thousands)
NOTE 6 - Short-term investments consist primarily of government and
agency bonds, tax exempt municipal bonds and corporate bonds. These
marketable securities are classified as trading and are adjusted to
market value at the end of each accounting period. Unrealized market
gains and losses, are included in earnings. Realized gains and
losses on sales of investments are determined on a specific
identification basis, and are included in earnings. For the six
months ended September 2, 2000 and August 28, 1999, gross realized
gains totaled $37 and $21 and gross realized losses totaled $49 and
$239, respectively. For the three months ended September 2, 2000 and
August 28, 1999, gross realized gains totaled $37 and $2 and gross
realized losses totaled $6 and $196, respectively.
The unrealized net gains which were included in earnings were $207
as of September 2, 2000 and the unrealized net losses which were
included in earnings were $470 as of March 4, 2000.
NOTE 7 - Basic net earnings per share excludes dilution and is computed
by dividing income available to common shareholders by the
weighted-average common shares outstanding for the period. Diluted
net earnings per share reflects the weighted-average common shares
outstanding plus the potential dilutive effect of options which are
convertible into common shares. Options which were excluded from the
calculation of diluted earnings per share because the exercise
prices of the options were greater than the average market price of
the common shares and, therefore, would be antidilutive, were
2,369,700 and 2,436,350 during the six months ended September 2,
2000 and August 28,1999, respectively.
NOTE 8 - The Company has adopted Statement of Financial Accounting
Standards No. 131, "Disclosures about Segments of an Enterprise and
Related Information," which established reporting and disclosure
standards for an enterprise's operating segments. Operating segments
are defined as components of an enterprise for which separate
financial information is available and regularly reviewed by the
Company's senior management.
The Company has the following two reportable segments: Wholesale and
Retail. The Wholesale segment designs, markets, sources and
distributes sportswear, activewear, outerwear, a jeans collection, a
tailored clothing collection, robes and sleepwear for men and a
jeans collection, and robes and sleepwear for women to retail store
customers. The Retail segment sells men's apparel and other
Nautica-branded products primarily through Retail store locations
directly to consumers.
-6-
<PAGE> 8
NAUTICA ENTERPRISES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
September 2, 2000
(unaudited)
(amounts in thousands)
Segment profit is based on earnings before income taxes. The
reportable segments are distinct business units and are
separately managed with different distribution channels.
<TABLE>
<CAPTION>
All Corporate/
Wholesale Retail Other Eliminations Totals
--------- ------ ----- ------------ ------
<S> <C> <C> <C> <C> <C>
FOR THE SIX MONTHS ENDED
SEPTEMBER 2, 2000
Net Sales $219,288 $71,313 $ -- $ -- $290,601
Earnings (loss) before provisions
for income taxes 16,348 9,948 4,232 (3,557) 26,971
Segment Assets 250,480 42,758 8,457 54,017 355,712
Depreciation expense 9,025 822 161 760 10,768
FOR THE SIX MONTHS ENDED
AUGUST 28, 1999
Net Sales $189,184 $62,305 $ -- $ - $251,489
Earnings (loss) before provisions
for income taxes 23,006 8,126 2,841 (3,730) 30,243
Segment Assets 212,759 45,744 9,267 55,620 323,390
Depreciation expense 7,403 499 219 312 8,433
</TABLE>
<TABLE>
<CAPTION>
All Corporate/
Wholesale Retail Other Eliminations Totals
--------- ------ ----- ------------ ------
<S> <C> <C> <C> <C> <C>
FOR THE THREE MONTHS ENDED
SEPTEMBER 2, 2000
Net Sales $125,031 $44,378 $ -- $ -- $169,409
Earnings (loss) before provisions
for income taxes 13,258 7,730 1,890 (963) 21,915
Segment Assets 250,480 42,758 8,457 54,017 355,712
Depreciation expense 4,641 443 15 401 5,500
FOR THE THREE MONTHS ENDED
AUGUST 28, 1999
Net Sales $113,293 $38,898 $ -- $ -- $152,191
Earnings (loss) before provisions
for income taxes 17,807 6,423 1,425 (2,589) 23,066
Segment Assets 212,759 45,744 9,267 55,620 323,390
Depreciation expense 3,733 260 137 156 4,286
</TABLE>
In the Corporate/Eliminations column the segment assets
primarily consist of the Company's cash and investment
portfolio and the segment operating loss consists of corporate
expenses offset by investment income earned.
- 7 -
<PAGE> 9
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS (unaudited)
RESULTS OF OPERATIONS
During the six months ended September 2, 2000, the Company changed its
presentation of markdowns and promotional allowances from a selling expense to a
reduction of sales in an effort to be consistent with industry-wide reporting
practices. In addition, the reserve for markdowns and promotional allowances has
been reclassified from accrued expenses to a reduction of accounts receivable.
Previously reported amounts have been reclassified to conform with the current
year's presentation. This change in presentation has no impact on operating
profit, earnings before provision for income taxes, or net earnings.
For the Six Months Ended September 2, 2000:
Net sales increased 15.6% to $290.6 million in the six months ended
September 2, 2000 from $251.5 million in the comparable prior year period. The
increase in sales is due primarily to increased unit volume rather than price
increases. The reported sales reflect a 15.9% increase in the Wholesale segment
to $219.2 million from $189.2 million and a 14.5% increase in the Retail segment
to $71.3 million from $62.3 million. The growth in the Wholesale segment was
driven by sales in new product lines and increases in core sportswear, men's
jeans and men's and ladies sleepwear sales. The overall Retail segment sales
increase is a result of sales from new stores opened since the second quarter of
last year, offset by lower comparable store sales.
Gross profit for the period was 41.3% compared to 42.2% in the
comparable prior year period. The decrease is due to the impact of lower margins
on new product lines, and markdowns associated with an increase in promotional
activity at retail.
Total selling, general and administrative expenses ("SG&A") increased
by $18.5 million to $98.2 million in Fiscal 2001 from $79.7 million in Fiscal
2000. SG&A expenses as a percentage of net sales increased to 33.8% from 31.7%
in Fiscal 2001. The increase is principally due to expenses incurred to support
the launch of new product lines.
Net royalty income increased by $.9 million to $3.7 million from $2.8
million in the comparable prior year period. The increase is primarily due to
the strength in children's apparel, eyewear, and women's swimwear. In addition,
the launch of a new men's fragrance contributed to the growth.
Investment income increased by $.6 million to $1.4 million from $.8
million in the comparable prior year period. The increase is due to higher rates
of return on investments.
The provision for income taxes decreased to 38.8% from 39.2% of
earnings before income taxes in the comparable prior year period. The decrease
is due primarily to a reduction in the effective state income tax rates.
Net earnings decreased 10.2% to $16.5 million from $18.4 million in the
comparable prior year period as a result of the factors discussed above.
-8-
<PAGE> 10
For the Three Months Ended September 2, 2000:
Net sales increased 11.3% to $169.4 million in the three months ended
September 2, 2000 from $152.2 million in the comparable prior year period. The
increase in sales is due primarily to increased unit volume rather than price
increases. The reported sales reflect a 10.4% increase in the Wholesale segment
to $125.0 million from $113.3 million and a 14.1% increase in the Retail segment
to $44.4 million from $38.9 million. The growth in the Wholesale segment was
driven by sales in new product lines and increases in core sportswear, men's
jeans and men's and ladies sleepwear sales. The overall Retail segment sales
increase is a result of sales from new stores opened since the second quarter of
last year, offset by lower comparable store sales.
Gross profit for the period was 41.2% compared to 42.6% in the
comparable prior year period. The decrease is due to the impact of lower margins
on new product lines, and markdowns associated with an increase in promotional
activity at retail.
Total selling, general and administrative expenses increased by $7.3
million to $50.8 million in Fiscal 2001 from $43.4 million in Fiscal 2000. SG&A
expenses as a percentage of net sales increased to 30.0% from 28.5% in Fiscal
2001. The increase is principally due to expenses incurred to support the launch
of new product lines.
Net royalty income increased by $.5 million to $1.9 million from $1.4
million in the comparable prior year period. The increase is primarily due to
the strength in children's apparel, eyewear, and women's swimwear. In addition,
the launch of a new men's fragrance contributed to the growth.
Investment income increased by $.6 million to $.9 million from $.3
million in the comparable prior year period. The increase is due to higher rates
of return on investments.
The provision for income taxes decreased to 38.8% from 39.2% of
earnings before income taxes in the comparable prior year period. The decrease
is due primarily to a reduction in the effective state income tax rates.
Net earnings decreased 4.4% to $13.4 million from $14.0 million in the
comparable prior year period as a result of the factors discussed above.
- 9 -
<PAGE> 11
LIQUIDITY AND CAPITAL RESOURCES
During the six months ended September 2, 2000, the Company generated
cash from operating activities of $11.5 million principally from net earnings.
Increases in accounts receivable and inventory of $20.4 and $30.0 million,
respectively, resulted from increased sales, and were financed principally by
cash generated from net earnings, and increases in accounts payable and accrued
expenses. Accounts receivable was 7.7% higher than the same period in the prior
year due to timing of shipments, with a greater percentage occurring in the last
part of the quarter. Inventory was 22.8% higher than the same period in the
prior year due to increased sales and the timing of merchandise received. During
the six months ended August 28, 1999, the Company generated cash from operating
activities of $14.1 million principally from net earnings. Increases in accounts
receivable and inventory of $12.0 and $14.3 million, respectively, resulted from
increased sales, and were financed principally by cash generated from net
earnings, and increases in accounts payable and accrued expenses. Accounts
receivable was 9.2% higher than the same period in the prior year due to timing
of shipments, with a greater percentage occurring in the last part of the
quarter. Inventory was 14.3% lower than the same period in the prior year due to
a shift by retailers in order delivery dates for the holiday season particularly
outerwear.
During the six months ended September 2, 2000, the Company's principal
investing activities related primarily to the continued expansion of the Nautica
in-store shop program. The Company expects to continue to incur capital
expenditures to expand the in-store shop program, and to open additional Retail
stores. The Company is planning the construction of a new distribution facility,
and is currently evaluating various financing vehicles for the project. At
September 2, 2000, there were no other material commitments for capital
expenditures.
During the six months ended September 2, 2000, the Board of Directors
authorized the Company to purchase 4,000,000 shares of its common stock. During
such period, the Company purchased 2,533,000 shares of its outstanding common
stock at a cost of $28.8 million.
The Company has a total of $150.0 million in lines of credit with four
commercial banks available for short-term borrowings and letters of credit.
These lines are collateralized by imported inventory and accounts receivable. At
September 2, 2000 and March 4, 2000, letters of credit outstanding under the
lines were $80.6 million and $50.5 million, respectively, and there were no
short-term borrowings outstanding.
Historically, the Company has experienced its highest level of sales in
the second and third quarters and its lowest level in the first and fourth
quarters due to seasonal patterns. In the future, the timing of seasonal
shipments may vary by quarter. The Company anticipates that internally generated
funds from operations, existing cash balances, short-term investments and the
Company's existing credit lines will be sufficient to satisfy its cash
requirements.
INFLATION AND CURRENCY FLUCTUATIONS
The Company believes that inflation and the effect of fluctuations of
the dollar against foreign currencies have not had a material effect on the cost
of imports or the Company's results of operations.
-10-
<PAGE> 12
FORWARD-LOOKING AND CAUTIONARY STATEMENTS
Certain statements in this Form 10-Q and in future filings by the
Company with the Securities and Exchange Commission, in the Company's press
releases, and in oral statements made by or with the approval of authorized
personnel constitute "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such forward-looking
statements are based on current expectations and are indicated by words such as
"believes," "anticipates," "estimates," and similar words or phrases and involve
known and unknown risks, uncertainties and other factors, which may cause the
actual results or performance of the Company to be materially different from any
future results or performance expressed or implied by such forward-looking
statements. Such risks, uncertainties and factors include, but are not limited
to, the following: the overall level of consumer spending on apparel; dependence
on sales to a limited number of large department store customers; risks related
to extending credit to customers; actions of existing or new competitors and
changes in economic or political conditions in the markets where the Company
sells or sources its products; risks associated with consolidations,
restructurings and other ownership changes in the retail industry; changes in
trends in the market segments in which the Company competes; risks associated
with uncertainty relating to the Company's ability to launch, support and
implement new product lines; and, other risks and uncertainties in the Company's
Securities and Exchange Commission filings, press releases or oral statements.
Readers are urged not to place undue reliance on these forward-looking
statements which speak only as of the date hereof. The Company undertakes no
obligation to republish revised forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Disclosure about interest rate risk
The Company has no long-term debt, and finances capital needs
through available capital, future earnings and bank lines of credit. The
Company's exposure to market risk for changes in interest rates is primarily in
its investment portfolio. The Company, pursuant to investing guidelines,
mitigates exposure by limiting maturity, placing investments with high credit
quality issuers and limiting the amount of credit exposure to any one issuer.
During the six months ended September 2, 2000, the Company earned investment
income of $1.5 million. If interest rates had been 1% lower than they were
during the year, investment income would have been $.3 million lower. The market
risks associated with the investment portfolio exposure has not changed
materially since March 4, 2000.
-11-
<PAGE> 13
PART II
OTHER INFORMATION
Items I through 9. - All items are inapplicable except:
Item 4. Submission of Matters to a Vote of Security-Holders
(a) The Annual Meeting of Stockholders of Nautica Enterprises, Inc. was
held on July 6, 2000.
(b) The directors named in the Proxy Statement constituting the entire
Board of Directors were elected to one-year terms expiring in 2001, as
follows:
<TABLE>
<CAPTION>
FOR WITHHELD
--- --------
<S> <C> <C>
Harvey Sanders 27,731,938 1,469,393
David Chu 27,732,388 1,468,943
George Greenberg 29,132,074 69,257
Robert B. Bank 29,138,822 62,509
Israel Rosenzweig 29,138,174 63,157
Charles Scherer 29,005,088 196,243
John Varvatos 28,138,372 62,959
Ronald G. Weiner 27,731,938 1,469,393
</TABLE>
The Notice of Annual Meeting of Stockholders and Proxy Statement for Nautica
Enterprises, Inc. dated June 6, 2000 was filed with the Securities and Exchange
Commission pursuant to Regulation 14A of the Act.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit Index
Exhibit No. Distribution
3(a) Registrant's By-laws as currently in effect are
incorporated herein by reference to Registrant's
Registration Statement on Form S-1 (Registration No.
33-21998).
3(b) Registrant's Restated Certificate of Incorporation is
incorporated by reference from the Registrant's Quarterly
Report on Form 10-Q for the fiscal quarter ended August
31, 1995, as amended by a Certificate of Amendment
incorporated by reference from the Registrant's Quarterly
Report on Form 10-Q for the quarter ended May 31, 1996.
10(iii)(a) Registrant's Executive Incentive Stock Option Plan is
incorporated by reference herein from the Registrant's
Registration Statements on Form S-8 (Registration Number
33-1488), as amended by the Company's Registration
Statement on Form S-8 (Registration Number 33-45823).
- 12 -
<PAGE> 14
10(iii)(b) Registrant's 1989 Employee Incentive Stock Plan is
incorporated by reference herein from the Registrant's
Registration Statement on Form S-8 (Registration Number
33-36040).
10(iii)(c) Registrant's 1996 Stock Incentive Plan is incorporated by
reference herein from Registrant's Registration Statement
on Form S-8 (Registration Number 333-55711).
10(iii)(d) Registrant's 1994 Incentive Compensation Plan is
incorporated herein from the Registrant's Annual Report on
Form 10-K for the fiscal year ended February 28, 1997.
10(iii)(e) Registrant's Deferred Compensation Plan is incorporated
herein by reference from the Registrant's Annual Report on
Form 10-K for the fiscal year ended February 28, 1998.
10(iii)(f) Option Agreement and Royalty Agreement, each dated July 1,
1987, by and among the Registrant and David Chu are
incorporated herein by reference from the Registrant's
Registration Statement on Form S-1 (Registration No.
33-21998), and letter agreement dated May 1, 1998 between
Mr. Chu and the Registrant is incorporated herein by
reference from the Registrant's Annual Report on Form 10-K
for the fiscal year ended February 28, 1998.
10(iii)(g) Employment Agreement, dated October 1, 1999, by and
between the Registrant and John Varvatos, and Split Dollar
Agreement, dated May 5, 2000, by and between the
Registrant and John Varvatos are incorporated herein by
reference from the Registrant's Annual Report on Form 10-K
for the fiscal year ended March 4, 2000.
27 Financial Data Schedule
(b) Reports on Form 8-K. None
- 13 -
<PAGE> 15
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.
NAUTICA ENTERPRISES, INC.
By: s/Harvey Sanders
---------------------------------
Harvey Sanders
Chairman of the Board
and President
Date: October 12, 2000
----------------------------
By: s/Wayne A. Marino
---------------------------------
Wayne A. Marino
Senior VP of Administration
and Chief Financial Officer
Date: October 12, 2000
-----------------------------
By: s/Lainie J. Goldstein
---------------------------------
Lainie J. Goldstein
Corporate Vice President -
Financial Controller
Date: October 12, 2000
-----------------------------
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