SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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
Commission file No. 1-13710
AID AUTO STORES, INC.
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE 11-2254654
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
275 Grand Boulevard, Westbury, New York 11590
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (516) 338 - 7889
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 ninety days.
Yes X No
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practical date.
Common stock, par value of $.001 per share: 3,957,596 shares as of
August 1, 1996
AID AUTO STORES, INC.
CONTENTS
PART I FINANCIAL INFORMATION PAGE
Item 1 Consolidated Condensed Financial Statements:
Balance Sheets as of June 30, 1996 and
December 31, 1995 . . . . . . . . . . . . . . . . . . . . . . 3
Statements of Operations for the Six Months Ended
June 30, 1996 and 1995. . . . . . . . . . . . . . . . . . . . 4
Statements of Operations for the Three Months Ended
June 30, 1996 and 1995. . . . . . . . . . . . . . . . . . . . 5
Statements of Cash Flows for the Six Months Ended
June 30, 1996 and 1995. . . . . . . . . . . . . . . . . . . . 6
Notes to Financial Statements . . . . . . . . . . . . . . . . 7
Item 2 Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . . . . 8
PART II OTHER INFORMATION
Item 6 Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . . 15
SIGNATURES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
AID AUTO STORES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
ASSETS
June 30, 1996 Dec. 31, 1995
(unaudited) (audited)
CURRENT ASSETS:
Cash and cash equivalents. . . . . . . . $ 460,255 $4,766,893
Accounts receivable-trade, net of
allowances for doubtful accounts
of $670,000 and $612,000 at June
30, 1996 and December 31, 1995,
respectively . . . . . . . . . . . . . 1,937,215 2,991,012
Inventories . . . . . . . . . . . . . . 11,990,610 9,372,480
Prepaid expenses and other current assets 1,494,805 1,400,703
Notes receivable, net of allowance for
doubtful accounts of $190,000 at
June 30, 1996 and December 31, 1995. . 281,445 245,014
Deferred income taxes 268,000 268,000
Total current assets . . . . . . . . 16,432,330 19,044,102
FIXED ASSETS, NET. . . . . . . . . . . 2,673,278 1,754,124
COSTS IN EXCESS OF NET ASSETS ACQUIRED,
NET. . . . . . . . . . . . . . . . . . 3,734,795 3,929,376
OTHER ASSETS:
Intangible assets. . . . . . . . . . . . 13,977 36,863
Notes receivable - net of current portion 148,589 218,824
Deferred income taxes 175,000 175,000
Security deposits & other assets . . . . 158,365 143,433
TOTAL ASSETS . . . . . . . . . . . . . $ 23,336,334 $25,301,722
LIABILITIES AND SHAREHOLDER'S EQUITY
CURRENT LIABILITIES
Note payable - bank. . . . . . . . . . . $ 5,085,530 $ 5,011,200
Accounts payable . . . . . . . . . . . . 4,270,269 4,315,842
Accrued expenses . . . . . . . . . . . . 378,369 487,386
Current portion of long-term debt. . . . 235,097 2,208,225
Note payable - officer . . . . . . . . . 660,000 468,750
Total current liabilities. . . . . . . 10,629,265 12,491,403
LONG-TERM DEBT. . . . . . . . . . . . . 1,768,016 1,582,373
DEFERRED OCCUPANCY COSTS . . . . . . . 136,775 157,995
NOTE PAYABLE - OFFICER . . . . . . . . . 1,683,750 2,031,250
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY
Preferred stock, $.001 par value;
authorized 2,000,000 shares;
none issued . . . . . . . . . . . . - -
Common stock, $.001 par value;
authorized, 15,000,000 shares;
3,957,596 shares issued and
outstanding at June 30, 1996 and
December 31, 1995. . . . . . . . . . 3,958 3,958
Additional paid-in capital . . . . . . . 8,994,049 9,006,809
Retained earnings. . . . . . . . . . . . 120,521 27,934
9,118,439 9,038,701
Total liabilities and shareholders'
equity . . . . . . . . . . . . . . . . $ 23,336,334 $ 25,301,722
See Notes to Consolidated Condensed Financial Statements
AID AUTO STORES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
Six Months Ended June 30,
Revenues 1996 1995
Net Sales . . . . . . . . . . . . . . $13,509,362 $9,489,677
Franchise Fees . . . . . . . . . . . 100,319 135,530
13,609,681 9,625,207
Costs and expenses:
Cost of sales . . . . . . . . . . . . 8,093,152 6,814,647
Selling and shipping . . . . . . . . 2,817,806 1,348,735
General and administrative . . . . . 2,353,608 1,461,800
$13,264,566 $9,625,182
Income from operations . . . . . . 345,115 25
Interest Expense . . . . . . . . . . . (395,946) (356,464)
Interest and other income . . . . . . . 175,033 112,162
Income (loss) from operations
before income taxes . . . . . . 124,202 (244,277)
Provision for income taxes . . . . . . 31,615 86,000
NET INCOME (LOSS). . . . . . . . . $ 92,587 $ (330,277)
Income (loss) per common share
Income (loss) from operations
before income taxes . . . . . . $.02 $(.09)
Net Income (loss) per common share $.02 $(.12)
Weighted average common shares outstanding 3,957,596 2,815,469
See Notes to Consolidated Condensed Financial Statements
AID AUTO STORES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended June 30,
Revenues 1996 1995
Net Sales . . . . . . . . . . . . . . . $6,987,669 $5,473,608
Franchise Fees . . . . . . . . . . . . 47,975 64,330
7,035,644 5,537,938
Costs and expenses:
Cost of sales . . . . . . . . . . . . . 4,082,676 3,966,041
Selling and shipping. . . . . . . . . . 1,131,118 731,575
General and administrative. . . . . . . 1,671,551 785,834
$6,885,345 $5,483,450
Income from operations . . . . . . . 150,299 54,488
Interest Expense . . . . . . . . . . . . (199,679) (162,372)
Interest and other income . . . . . . . . 123,364 78,320
Income (loss) from operations before
income taxes . . . . . . . . . . . 73,984 (29,564)
Provision for income taxes . . . . . . . 23,000 46,000
NET INCOME (LOSS) . . . . . . . . . . . $ 50,984 $ (75,564)
Income (loss) per common share
Income (loss) from operations before
income taxes . . . . . . . . . . . $.01 $(.01)
Net Income (loss) per common share . $.01 $(.02)
Weighted average common shares outstanding 3,957,596 3,621,978
See Notes to Consolidated Condensed Financial Statements
AID AUTO STORES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended June 30,
1996 1995
Cash flows from operating activities
Net income (loss) . . . . . . . . . . . . . $92,587 $(330,277)
Adjustments to reconcile net income
(loss) to net cash used in operating
activities
Depreciation and amortization . . . . 336,283 203,525
Provision for losses on accounts
receivable . . . . . . . . . . . . . 58,000 66,000
Deferred occupancy costs . . . . . . . (21,220) 31,889
(Increase) decrease in operating assets
Accounts Receivable . . . . . . . . . 995,797 (851,637)
Notes Receivable . . . . . . . . . . . 33,804 74,705
Inventories . . . . . . . . . . . . . (2,618,130) (1,659,798)
Prepaid expenses & other current
assets . . . . . . . . . . . . . . . (94,102) (317,804)
Security deposits. . . . . . . . . . . (14,932) 1,000
Deferred income taxes. . . . . . . . . - 86,322
Increase (decrease) in operating liabilities
Accounts payable . . . . . . . . . . . (58,333) 1,271,553
Accrued expenses . . . . . . . . . . . (109,017) 26,990
Income taxes payable . . . . . . . . . - (115,950)
Net cash used in operating activities. . . (1,399,263) (1,513,482)
Cash flows from investing activities
Capital expenditures . . . . . . . . . . . $(1,037,970) $ (34,108)
Net cash used in investing activities. . . $(1,037,970) $ (34,108)
Cash flows from financing activities
Net borrowings under revolving credit line 74,330 (390,811)
Principal payments of long-term debt . . . (1,787,485) (21,134)
Repayment of officers' loans . . . . . . . (156,250) (551,951)
Net proceeds from issuance of common stock - 7,297,366
Net cash (used in) provided by financing
activities . . . . . . . . . . . . . . . (1,869,405) 6,333,470
Net (decrease) increase in cash and cash
equivalents. . . . . . . . . . . . . . . (4,306,638) 4,785,880
Cash and cash equivalents, at beginning
of year . . . . . . . . . . . . . . . . . . 4,766,893 359,584
Cash and cash equivalents, at end of year . . $ 460,255 $ 5,145,464
Supplemental disclosures of cash flow
information:
Cash paid during the year for
Interest . . . . . . . . . . . . . . 378,100 303,460
Income taxes . . . . . . . . . . . . 119,228 161,999
See Notes to Consolidated Condensed Financial Statements
AID AUTO STORES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Unaudited)
A. CONSOLIDATED FINANCIAL STATEMENTS:
The consolidated balance sheet as of June 30, 1996 and the consolidated
statements of operations and cash flows for the three and six month
periods ended June 30, 1996 and June 30, 1995 have been prepared by
the Company without audit. In the opinion of management, all
adjustments (which included only normal recurring adjustments)
necessary to present fairly the financial position at June 30, 1996,
and the results of operations and cash flows for the periods presented
have been made. Results of operations for the three and six month
periods ended June 30, 1996 are not necessarily indicative of the
operating results to be expected for the full year.
For information concerning the Company's significant accounting policies,
reference is made to the Company's audited financial statements for the
year ended December 31, 1995 contained in the Company's Annual Report
on Form 10-K filed with the Securities and Exchange Commission. While
the Company believes that the disclosures presented are adequate to
make the information contained herein not misleading, it is suggested
that these statements be read in conjunction with the consolidated
financial statements and notes included in the Form 10-K.
B. INVENTORIES
Inventories consist primarily of merchandise purchased for resale.
AID AUTO STORES, INC.
Management's Discussion and Analysis of
Financial Condition and Results of Operations
General:
Aid Auto Stores, Inc. (the "Company"), formed in 1953, is a
franchisor, retailer and wholesaler of automotive parts and
accessories. As of June 30, 1996, the Company supplied products to 59
Aid Auto Stores, including 41 franchised stores and 18 Company-owned
stores, and, through its wholly-owned subsidiary, Ames Automotive
Warehouse, Inc. ("Ames"), to hundreds of non-automotive chain stores
and independent jobbers and installers in New York, New Jersey and
Connecticut. The Aid Auto stores sell an extensive variety of name-brand
automotive parts, accessories and chemicals, as well as an assortment of
products marketed under the "Aid" and "Perfect Choice" brands to both
do-it-yourself ("DIY") and commercial customers. In 1994, in
anticipation of commencing its Company-owned mini-warehouse Superstore
growth strategy, the Company curtailed the granting of new franchises,
so as to preserve favorable locations for Company-owned Superstores.
In April 1995, the Company consummated its Initial Public Offering,
the net proceeds of which were approximately $7,300,000. As of June
30, 1996, the Company had opened four new Superstores and had acquired
(in December, 1995) ten franchised Aid Auto Stores located in Long
Island, New York, of which it currently intends to convert nine to
Superstores. The Company currently anticipates the opening of up to
48 to 60 Superstores in the five-year period following the April 1995
Initial Public Offering. The number of stores to be opened during
this period is subject to substantial variation depending upon, among
other factors, the availability of adequate financing to fund the cost
of adding the additional stores, the level of success of the initial
Superstores, the availability of suitable store sites or acquisition
candidates, and the timely development and construction of new stores.
The anticipated favorable financial performance of the Company is tied,
to a large extent, to the transition of the Company to the Superstore
program and the strong future potential of that program. The
Company's operating expenses have increased significantly, and are
expected to continue to increase, in connection with the Superstore
growth program. Accordingly, the Company's future profitability will
depend upon corresponding increases in revenue from Superstore
operations, of which there can be no assurance.
On July 22, 1995, the Company held the Grand Opening of its first new
Company-owned Superstore. The store is located in Long Island City,
in the New York City Borough of Queens. As of June 30, 1996, the
Company opened Superstore locations on main thoroughfares in Brooklyn
and Queens, New York and in a major shopping mall in Staten Island,
New York.
The Company has also sought to grow its operations by means of acquiring
other companies, including Aid franchisees, having parts and
accessories retail stores. On December 15, 1995, the Company acquired
ten franchised Aid Auto stores located in Long Island, New York.
Following the acquisition, the Company commenced converting up to nine
of the ten stores into Aid Auto Superstores.
Results of Operations:
Six Months Ended June 30, 1996 Compared to Six Months Ended June 30, 1995.
Three Months Ended June 30, 1996 Compared to Three Months Ended June 30, 1995.
The Company's operating revenues are primarily derived from net sales
consisting of both retail and wholesale sales. Retail sales are made
from the Company-owned Aid Auto Stores of which 18 existed at June 30,
1996 and four existed at June 30, 1995. Wholesale sales include sales
to the Company's franchised Aid Auto Stores, of which 41 existed at
June 30, 1996 and 69 existed at June 30, 1995, and through Ames, to
hundred of other customers. Revenues increased by $3,985,000 or 41.4%
from $9,625,000 for the six months ended June 30, 1995 to $13,610,000
for the six months ended June 30, 1996 and by $1,498,000 or 27.0% from
$5,538,000 for the three months ended June 30, 1995 to $7,036,000 for
the three months ended June 30, 1996. The increase in revenues in
1996 was primarily due to the increase of $6,538,000 and $3,821,000 in
sales from Company-owned stores from $1,240,000 to $ 7,778,000 for the
six months ended June 30, 1995 and 1996, respectively, and $ 555,000
to $ 4,376,000 for the three months ended June 30, 1995 and 1996,
respectively. Subsequent to the second quarter of 1995, the Company
acquired ten franchised Aid Auto Stores located in Long Island, New
York, and opened four new Superstores. In addition, the seasonal cold
and wet winter of 1995-1996 resulted in the increase in the sale of
certain items (e.g. anti-freeze and other winter chemicals) and an
increased need for other winter maintenance items (especially when
compared to the exceptionally mild, auto-friendly winter weather in
1994-1995 which resulted in a decrease in the sale of winter items).
Revenue increases were offset in part by a decrease in sales to
franchisees, reflecting the Company's decision consistent with its
Superstore growth strategy to generally not grant new franchises
(which results in a loss of sales to new franchisees). Furthermore, an
additional seven franchised stores were terminated in the first half
of 1996.
Cost of sales increased by $1,278,000 or 18.8%, and $117,000 or 2.9%,
from $6,815,000 to $8,093,000 for the six months ended June 30, 1995
and 1996, respectively, and from $3,966,000 to $4,083,000 for the
three months ended June 30, 1995 and 1996, respectively. The increase
in cost of sales in absolute dollars was attributable to the increased
volume of sales in 1996. As a percentage of net sales, cost of sales
declined from 71.8% and 72.5% for the six and three month periods
ended June 30, 1995, respectively, to 59.9% and 58.4% for the
comparable periods in 1996, reflecting the significantly higher
margins on retail sales from the new Superstores (as compared to lower
margin on wholesale sales).
Selling and shipping expenses increased by $1,469,000 or 108.9% from
$1,349,000 or 14.2% of net sales for the six months ended June 30,
1995 to $2,818,000 or 20.9% of net sales for the six months ended June
30, 1996. Selling and shipping expenses increased by $399,000 or 54.5%
from $732,000 or 13.4% of net sales for the second quarter of 1995 to
$1,131,000 or 16.2% of net sales for the second quarter of 1996. The
increase as an absolute amount and as a percentage of net sales for
the three and six month periods was due primarily to a substantial
increase of selling expense, reflecting a greater Company
infrastructure and a significant increase in the Company's retail
operations. Selling expense is higher for a retail operation than for
a wholesale operation, reflecting the nature of these operations. As a
result of the Company's strong efforts to control costs, the shipping
expense dollars remained essentially constant despite the large
increase in sales volume.
General and administrative expenses increased by $892,000 or 61.0%, from
$1,462,000 or 15.4% of net sales for the six months ended June 30,
1995 to $2,354,000 or 17.4% of net sales for the six months ended June
30, 1996. General and administrative expenses increased by $886,000 or
113.0% from $786,000 or 14.4% of net sales for the second quarter of
1995 to $ 1,672,000 or 23.9% of net sales for the second quarter of
1996. The increase as an absolute amount and as a percentage of net
sales for the three and six month periods was due to the additional
infrastructure needed in connection with the increased volume of
business for the additional Company-owned stores.
Interest expense increased $39,000, from $357,000 for the six months
ended June 30, 1995 to $396,000 for the comparable period of 1996.
Interest expense increased $38,000 from $162,000 for the second
quarter ended June 30, 1995 to $200,000 for the second quarter ended
June 30, 1996. This nominal increase was due to increased borrowings
from the Company's bank as well as interest incurred in connection
with the acquisition of the ten stores.
The increase in income from operations and net income for the three
and six month periods ended June 30, 1996 as compared to comparable
periods in 1995 is a result of the above aforementioned factors.
Liquidity and Capital Resources:
The Company had working capital of $5,803,000 at June 30, 1996, as
compared to $6,553,000 at December 31, 1995, reflecting the decrease
in the accounts receivable-trade associated with the Aid Auto
franchisees as the Company changes its operations to a retail from a
wholesale environment. Through June 30, 1996, the Company had financed
its capital requirements predominantly through a bank loan and credit
facility, currently with Israel Discount Bank of New York (the
"Bank"), through loans from one of its officers, and through the
Company's Initial Public Offering, the net proceeds of which were
approximately $7,300,000.
Net cash used in operating activities was $1,513,000 for the first six
months of 1995 and $1,399,000 for the first six months of 1996. The
decrease in 1996 was attributable primarily to increases in
inventories, as a result of the increase in the number of retail
stores, and decreases in accounts payable, offset by decreases in
accounts receivable, as well as the generation of net income in the
first half of 1996 as compared to a loss in the same period of 1995.
Net cash utilized in investing activities was $34,000 and $1,038,000
in the first six months of 1995 and 1996, respectively, the increase
reflecting increased expenditures on fixed assets in connection with
the Superstore expansion program. Net cash of $6,333,000 was
provided by financing activities in the first six months of 1995
compared to $1,869,000 used in financing activities in the first six
months of 1996. The shift was primarily attributable to the receipt
of the net proceeds of the Initial Public Offering in the first half
of 1995 and to the use of a short term note in connection with the
acquisition of the ten store locations.
Effective September 1, 1995, the Company entered into a new loan
agreement with the Bank for a two year revolving credit line of up to
an aggregate of $6,000,000 with an interest rate equal to the prime
rate. As of June 30, 1996, $5,085,530 was outstanding under the line
of credit. In connection with the entry into the new loan agreement,
the Bank released the personal guarantee of Philip L. Stephen, the
Company's Chairman, Chief Executive Officer, President, and majority
shareholder, and also released the subordination of his loan to the
Company to the loan by the Bank. In March, 1996, the subordination was
reinstated for $425,000, which is less than the full amount of the loan.
Substantially all of the Company's assets are pledged to the Bank as
collateral, and the Company is prohibited from granting a security
interest to any party other than the Bank, which could limit the
Company's ability to obtain debt financing to implement its proposed
expansion. In addition, the Company's agreement with the Bank limits
or prohibits the Company, subject to certain exceptions, from merging
or consolidating with another corporation or selling all or
substantially all of its assets. As of June 30, 1996, the Company was
in compliance with all of the covenants contained in the loan agreement
with the Bank. In the event that the Company is unable to make
payment on its line of credit when due on August 31, 1997, the Bank
could foreclose on the collateral, which would have a material adverse
effect on the Company.
At June 30, 1996, the Company was indebted to Mr. Stephen in the
aggregate amount of $2,343,750. The $2,343,750 loan is evidenced by
two promissory notes. The notes initially bear interest at seven
percent (7%) per annum, payable monthly, with principal payable in
quarterly installments commencing May 1, 1996 through February 1,
2000. On January 31, 1996, the interest rate converted to the
interest rate charged by the Company's bank. The note provides for
immediate payment thereof upon, among other things, a change in a
majority of the continuing directors of the Company (as defined in the
note) or a demand by the Bank of payment in full of outstanding Bank
indebtedness.
The Company's accounts receivable, less allowances for doubtful
accounts, at June 30, 1996, were $1,937,000, as compared to $2,991,000
at December 31, 1995. The decrease was due to a decrease in the
amount of wholesale sales on credit terms in 1996 as compared to 1995.
At June 30, 1996, the Company's allowance for doubtful accounts was
$670,000, which the Company believes is currently adequate for the
size and nature of its receivables. At June 30, 1996, notes
receivable, less allowance for doubtful accounts, were $430,000, as
compared to $464,000 at December 31, 1995. The decrease in notes
receivable primarily reflects collections on the promissory notes.
Currently, eight franchisees are obligated under notes. Their
inability to pay for purchases under standard payment terms is due
primarily to a downturn in their business during the recessionary
economy of 1991 to 1993 (in some cases exacerbated by road
construction making access to the stores difficult). It is the
Company's policy to convert accounts receivable to a note when a
franchisee has demonstrated an inability to pay its account on a
timely basis. Delays in collection or uncollectability of accounts
and notes receivable could have an adverse effect on the Company's
liquidity and working capital position.
At June 30, 1996, the Company had deferred tax assets of $443,000. The
Company, after considering its previous pattern of profitability and
its anticipated future taxable income, believes that it is more likely
than not that the deferred tax assets will be realized. In this
respect, the Company estimates that $1,100,000 of future taxable
income will be required to realize the deferred tax assets, with the
majority of such assets anticipated to be recovered over the next
five years.
As of the date hereof, other than in connection with the
implementation of the Superstore growth program, the Company has no
material commitments for capital expenditures. In connection with the
acquisition of the ten stores described above, the Company was
obligated to expend $2,000,000 in cash on January 2, 1996 in repayment
of short term notes. In addition as part of the purchase price of the
acquisition, the Company assumed $1,000,000 of trade payables, as well
as issued 157,596 shares of common stock of the Company and a
promissory note in the amount of $1,507,396.
The Company has used a substantial portion of the net proceeds of the
Initial Public Offering to implement its proposed Superstore growth
program. The Company will need to seek additional debt or equity
financing, as the Company does not anticipate that its current
resources and cash flow from operations will be sufficient to fund the
continuing cost of its growth program to open 48 to 60 Superstores.
To the extent that the Company seeks financing through the issuance of
equity securities, any such issuance of equity securities would result
in dilution to the interests of the Company's stockholders.
Additionally, to the extent that the Company incurs indebtedness to
fund increased levels of accounts receivable or to finance the
acquisition of capital equipment or issues debt securities to fund the
Superstore growth program, the Company will be subject to risks
associated with incurring substantial indebtedness, including the
risks that interest rates may fluctuate and cash flow may be
insufficient to pay principal and interest on any such indebtedness.
Other than the Company's existing line of credit with the Bank, the
Company has no current arrangements with respect to, or sources of,
additional financing and it is not anticipated that the existing
majority stockholder will provide any portion of the Company's future
financing requirements or further personal guarantees. There can be no
assurance that additional financing will be available to the Company on
acceptable terms, or at all.
Seasonality:
The Company's business is seasonal to some extent primarily as a
result of the impact of weather conditions on store sales. Store
sales and profits have historically been higher in the second and
third quarters (April through September) of each year than in the
first and fourth quarters, for which the Company generally achieves
only nominal profits or incurs net losses. Weather extremes tend to
enhance sales by causing a higher incidence of parts failure and
increasing sales of seasonal products. However, extremely severe winter
weather or rainy conditions tend to reduce sales by causing deferral
of elective maintenance.
Impact of Inflation:
Inflation has not had a material effect on the Company's operations.
AID AUTO STORES, INC.
Part II OTHER INFORMATION
Item 6 Exhibits and 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 by the
undersigned thereunto duly authorized.
AID AUTO STORES, INC.
(Registrant)
Date: August 14, 1996
Philip L. Stephen, Chairman, Chief
Executive Officer and President
Date: August 14, 1996
Frank Mangano
Chief Financial Officer
(principal financial officer)
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.
AID AUTO STORES, INC.
(Registrant)
Date: August 14, 1996 /s/ Philip L. Stephen
Philip L. Stephen, Chairman, Chief
Executive Officer and President
Date: August 14, 1996 /s/ Frank Mangano
Frank Mangano
Chief Financial Officer
(Principal Financial Officer)
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<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
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0
0
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