SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
{ X } Annual report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the fiscal year ended January 29, 1994
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 0-1308
STRAWBRIDGE & CLOTHIER
(Exact name of registrant as specified in its charter)
Pennsylvania 23-1131660
(State or other jurisdiction (I.R.S. Employer
of Identification No.)
incorporation or organization)
801 Market Street
Philadelphia, Pennsylvania 19107-3199
(Address of principal (Zip Code)
executive offices)
Registrant's telephone number, including area code (215) 629-6000
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each
exchange on which registered
None None
Securities registered pursuant to Section 12(g) of the Act:
Series A Common Stock, par value $1 per share
(Title of class)
$5 Cumulative Preferred Stock, par value $100 per share
(Title of class)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports) and (2) has been subject to such filing
requirements for the past 90 days.
YES X NO _____
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Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. /X/
The aggregate market value of the Series A Common Stock and the
Series B Common Stock, par value $1 per share, of the registrant
held by nonaffiliates of the registrant as of April 7, 1994 was
$215,517,862.
The number of shares of Series A Common Stock, par value $1 per
share, of the registrant outstanding at April 7, 1994 was
7,152,172.
The number of shares of Series B Common Stock, par value $1 per
share, of the registrant outstanding at April 7, 1994 was
3,234,231.
DOCUMENTS INCORPORATED BY REFERENCE
(1) Portions of the 1993 Annual Report to shareholders are
incorporated by reference in Part II.
(2) Portions of the definitive 1994 annual meeting proxy
statement filed with the Securities and Exchange Commission on
April 21, 1994 pursuant to Regulation 14A are incorporporated
by reference in Part III.
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PART I
Item 1. Business.
Strawbridge & Clothier (the "Company") operates 13
department stores at its original location in Philadelphia and in
the surrounding Delaware Valley area of Pennsylvania, New Jersey
and Delaware. The Company also operates, under the Clover name,
25 discount stores in the same market area as well as in the
Lehigh Valley and Lancaster areas of Pennsylvania. The Company
is the successor to a business begun in 1868.
All of the Company's department stores carry most of
the classes of general merchandise usually offered by full-line
department stores. Among the principal types of merchandise sold
are men's, women's and children's apparel, including men's and
boys' clothing, furnishings and footwear, women's coats, suits,
dresses, furs, sportswear, intimate apparel, accessories, shoes
and jewelry and infants' and children's clothing and accessories;
smallwares, including cosmetics, stationery and candy; home
furnishings, including domestics, draperies, lamps, housewares,
furniture, rugs, television sets, audio equipment, china,
glassware and silverware; and gifts. The department stores also
provide various services such as interior decorating, beauty
salons, restaurants, jewelry repair and fur storage. The Company
has arrangements with several common carriers for the delivery by
truck of merchandise to its department store customers throughout
the Company's trading area.
The Clover stores offer a complete range of general
merchandise exclusive of major appliances and furniture. No home
delivery or other services are provided except for cafeteria-
style restaurant service in two stores, snack bars in all stores,
pharmacies in eight stores and beauty salons in nine stores.
The Company's merchandise is sold under a broad variety
of brand names including the Company's own brand names,
manufacturers' brand names, and several brand names owned by the
Associated Merchandising Corporation, of which the Company is a
member.
Strawbridge & Clothier charge cards, VISA, MasterCard,
American Express and Discover cards are accepted at both the
department stores and Clover stores.
In the fiscal year ended January 29, 1994,
approximately 37% of sales were on a cash basis and 63% of sales
were credit sales. The Company's stores have sales activity
throughout the year. Approximately 30% of annual sales are made
in the peak period of November and December.
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As of January 29, 1994, the Company had 5,351 full time
employees, 1,969 regular part time employees and 4,784 contingent
employees who are scheduled as needed.
There has not been any significant change in the kinds
of services rendered, or in the markets or methods of
distribution, since the beginning of the fiscal year ended
January 29, 1994.
The general merchandise business in the Company's
principal market of downtown Philadelphia and the surrounding
Delaware Valley area of southeastern Pennsylvania, southern New
Jersey and northern Delaware is highly competitive. The Company
competes on the basis of quality of merchandise, customer
service, price and store location. The Company's department and
discount stores are in active competition with national chain,
regional chain and local retail stores within their market areas,
including conventional and discount department stores, specialty
stores and mail order companies. Many of the Company's
competitors have considerably larger national sales and financial
resources than the Company.
Item 2. Properties.
The Company's main department store is in downtown
Philadelphia and its 12 suburban branch department stores are
located in the surrounding Delaware Valley area of southeastern
Pennsylvania (seven stores), southern New Jersey (three stores)
and northern Delaware (two stores). The Philadelphia department
store contains approximately 1,065,000 square feet of floor area.
The suburban branch department stores generally contain from
150,000 to 255,000 square feet, with one store containing 108,000
square feet of floor area. All of the branch department stores
are located in shopping centers or malls. The Company's 25
Clover discount stores are located in the same market area as its
department stores (15 in southeastern Pennsylvania, six in
southern New Jersey and one in northern Delaware), as well as in
the Lehigh Valley (two stores) and Lancaster (one store) areas of
Pennsylvania. The Clover stores contain from 70,000 to 157,000
square feet of floor area. The Company owns 15 of its stores, of
which two are on leased land and six are subject to mortgages or
similar liens. The Company leases the remainder of the stores
from third parties with, in most cases, long-term renewal rights
or an option to purchase. The Company also maintains warehouse
and distribution facilities in Philadelphia and New Jersey.
Item 3. Legal Proceedings.
There are no material pending legal proceedings to
which the Company or its subsidiaries is a party or of which any
of their property is subject. The Company is a party to ordinary
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routine legal proceedings incidental to the conduct of its
business, none of which are material.
Item 4. Submission of Matters to a Vote of Security
Holders.
This item is not applicable because there were no
matters submitted to a vote of security holders during the fourth
quarter of fiscal year 1993.
Executive Officers of the Registrant.
Office
Held
Name Age Office(1) Since (2)
Francis R. 56 Chairman of the Board 1984
Strawbridge, III(3)
Peter S. Strawbridge(3) 55 President 1979
Warren W. White 62 Executive Vice 1979
President
Steven L. 50 Vice President,
Strawbridge(3) Treasurer and 1982
Secretary
Ronald B. Avellino 55 Vice President 1987
Louis F. Busico 59 Vice President 1979
Harry T. Hinkel 55 Vice President 1993
Robert A. Hoffner 51 Vice President 1984
Charles D. Hollander 63 Vice President 1988
Alexander B. Jervis 50 Vice President 1992
Alice T. Kanigowski 55 Vice President 1986
John J. Leahy 63 Vice President 1969
Robert G. Muskas 55 Vice President 1980
Thelma A. Newman 54 Vice President 1994
E. Spencer Quill 52 Vice President 1990
Thomas S. Rittenhouse 52 Vice President 1978
G. Leonard Shea 60 Vice President 1977
David W. Strawbridge(3) 54 Vice President 1978
William A. Timmons 58 Vice President 1979
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__________
(1) Each executive officer has been employed by the Company as
an executive officer for at least the past five years,
except for E. Spencer Quill who was Director of
Administration and Distribution prior to his election in
1990; Alexander B. Jervis who was Director of Assets
Protection prior to his election in 1992; Harry T. Hinkel
who was a Store Manager prior to his election in 1993; and
Thelma A. Newman who was a Divisional Merchandise Manager
prior to her election in 1994.
(2) The executive officers of the Company are elected annually
to hold office until the annual organization meeting of the
Board of Directors and until their respective successors
shall have been duly elected and qualified.
(3) Peter S. Strawbridge and Steven L. Strawbridge are brothers
and are first cousins of Francis R. Strawbridge, III and
David W. Strawbridge, who also are brothers.
PART II
Item 5. Market for the Registrant's Common Equity and
Related Stockholder Matters.
The information appearing in the section captioned
"Market and Dividend Information" from the portions of the
Company's 1993 Annual Report to shareholders filed as Exhibit 13
to this Form 10-K is incorporated herein by reference.
Item 6. Selected Financial Data.
The information appearing in the section captioned
"Ten-Year Financial Summary" from the portions of the Company's
1993 Annual Report to shareholders filed as Exhibit 13 to this
Form 10-K is incorporated herein by reference.
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
The information appearing in the section captioned
"Management's Discussion and Analysis of Financial Condition and
Results of Operations" from the portions of the Company's 1993
Annual Report to shareholders filed as Exhibit 13 to this Form
10-K is incorporated herein by reference.
Item 8. Financial Statements and Supplementary Data.
The information appearing in the sections captioned
"Consolidated Statements of Operations," "Consolidated Balance
Sheets," "Consolidated Statements of Cash Flows," "Consolidated
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Statements of Common Shareholders' Equity," "Notes to
Consolidated Financial Statements," "Statement of Management
Responsibility" and "Report of Ernst & Young, Independent
Auditors" from the portions of the Company's 1993 Annual Report
to shareholders filed as Exhibit 13 to this Form 10-K are
incorporated herein by reference.
The information appearing in the section captioned
"Quarterly Results of Operations" from the portions of the
Company's 1993 Annual Report to shareholders filed as Exhibit 13
to this Form 10-K is incorporated herein by reference.
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure.
This item is not applicable.
PART III
Item 10. Directors and Executive Officers of the Registrant.
The information as to directors required by this item
is incorporated herein by reference from the section captioned
"Election of Directors" in the Company's definitive 1994 annual
meeting proxy statement which has been filed pursuant to
Regulation 14A. The required information as to executive
officers is set forth in Part I hereof and incorporated herein by
reference.
Item 11. Executive Compensation.
The information required by this item is incorporated
herein by reference from the section captioned "Executive
Compensation" in the Company's definitive 1994 annual meeting
proxy statement which has been filed pursuant to Regulation 14A.
Item 12. Security Ownership of Certain Beneficial Owners and
Management.
The information called for by this item is incorporated
herein by reference from the section captioned "Beneficial
Ownership of Voting Securities" in the Company's definitive 1994
annual meeting proxy statement which has been filed pursuant to
Regulation 14A.
Item 13. Certain Relationships and Related Transactions.
None.
PART IV
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Item 14. Exhibits, Financial Statement Schedules and Reports on
Form 8-K.
(a) All financial statements and schedules.
A list of the financial statements and supporting
schedules included in this Report appears on page F-1
hereof.
(b) Reports on Form 8-K.
No reports on Form 8-K were filed during the last
fiscal quarter of the fiscal year covered by this
Report.
(c) Exhibits.
(3) (i) Restated Articles of the Company filed on
January 3, 1990 with the Department of State
of the Commonwealth of Pennsylvania, as filed
as Exhibit 3(a) to Form 10-K for the fiscal
year ended February 3, 1990, are incorporated
herein by reference.
(ii) By-Laws, effective October 1, 1989, as filed
as Exhibit 3(b) to Form 10-K for the fiscal
year ended February 3, 1990, are incorporated
herein by reference.
(4.1) Note Purchase Agreement dated as of
November 1, 1977 relating to 8 1/2%
Secured Notes of S&C, Center Square,
Inc. due August 1, 2003.*
(4.2) Note Agreement dated November 22, 1985
relating to 11.50% Senior Notes of
Strawbridge & Clothier due November 15,
2000.*
(4.3) Indenture dated as of October 15, 1993
relating to 6 5/8% Notes of Strawbridge
& Clothier due October 15, 2003.*
(4.4) Note Agreement dated September 14, 1989
relating to Strawbridge & Clothier
Senior Notes, 9.20% Series A due
* Pursuant to Item 601(b)(4)(iii) of Regulation S-K, the
document listed is not filed with this Report. Registrant
agrees to furnish a copy of such document to the Commission
upon request.
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September 30, 2004 and 9.00% Series B
due September 30, 1999.*
(4.5) Note Agreement dated October 13, 1992
relating to Strawbridge & Clothier 7.04%
Senior Notes due October 15, 1997.*
(10) Management Contracts or Compensatory Plans or
Arrangements Required to be filed as
Exhibits:
(10.1) Deferred Compensation Plan for Key
Executive Employees of Strawbridge &
Clothier as amended and restated
effective February 1, 1985, as filed as
Exhibit (10) to Form 10-K for the fiscal
year ended February 2, 1985, is
incorporated herein by reference.
(10.2) 1985 Stock Option Plan of Strawbridge &
Clothier as amended effective February
22, 1989, as filed as Exhibit 10(b) to
Form 10-K for the fiscal year ended
January 28, 1989, is incorporated herein
by reference.
(10.3) 1991 Stock Option Plan of Strawbridge &
Clothier, as filed as Exhibit 10(c) to
Form 10-K for the fiscal year ended
February 1, 1992, is incorporated herein
by reference.
(10.4.1) Form of Employment Agreement for
executive officers of the Company as
filed as Exhibit 10.4.1 to Form 10-K for
the fiscal year ended January 30, 1993,
is incorporated herein by reference.
(10.4.2) Schedule of certain terms of Employment
Agreements for the executive officers
named in the Company's Summary
Compensation Table for the fiscal year
ended January 29, 1994.
(11) Statement re: Computation of per share
earnings.
(13) Portions of the 1993 Annual Report to
Shareholders, included as part of this
Report.
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(21) Subsidiaries of the Registrant, as filed as
Exhibit 21 to Form 10-K for the fiscal year
ended January 30, 1993, is incorporated
herein by reference.
(23) Consent of Ernst & Young, Independent
Auditors.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
STRAWBRIDGE & CLOTHIER
(Registrant)
By /s/Francis R. Strawbridge, III
Francis R. Strawbridge, III
Chairman of the Board
Dated: April 27, 1994
Pursuant to the requirements of the Securities Exchange Act
of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on
the dates indicated.
Margaret S. Clews 04/27/1994 Isaac H. Clothier, IV 04/27/1994
Margaret S. Clews Isaac H. Clothier, IV
Director Director
James M. Gassaway 04/27/1994 Richard H. Hall 04/27/1994
James M. Gassaway Richard H. Hall
Director Director
Thomas B. Harvey, Jr. 04/27/1994 Anne C. Longstreth 04/27/1994
Thomas B. Harvey, Jr. Anne C. Longstreth
Director Director
Paul E. Shipley 04/27/1994 David W. Strawbridge 04/27/1994
Paul E. Shipley David W. Strawbridge
Director Director and Vice President
Francis R. Strawbridge, III 04/27/1994
Francis R. Strawbridge, III
Director and Chairman of the Board
(co-principal executive officer)
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Peter S. Strawbridge 04/27/1994 Steven L. Strawbridge 04/27/1994
Peter S. Strawbridge Steven L. Strawbridge
Director and President Director, Vice President
(co-principal executive officer) Treasurer and Secretary
(principal financial officer)
Thomas S. Rittenhouse 04/27/1994 Warren W. White 04/27/1994
Thomas S. Rittenhouse Warren W. White
Vice President and Controller Director and Executive
(principal accounting officer) Vice President
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FORM 10-K -- ITEM 14(a)(1) and (2)
LIST OF FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
STRAWBRIDGE & CLOTHIER AND SUBSIDIARIES
The following consolidated financial statements of Strawbridge &
Clothier and subsidiaries and the report of independent auditors
thereon and a statement of management responsibility, included in
the 1993 Annual Report to shareholders, are incorporated by
reference in Item 8:
Consolidated Statements of Operations--Fiscal years ended
January 29, 1994, January 30, 1993 and February 1, 1992
Consolidated Balance Sheets--January 29, 1994 and January
30, 1993
Consolidated Statements of Cash Flows--Fiscal years ended
January 29, 1994, January 30, 1993 and February 1, 1992
Consolidated Statements of Common Shareholders' Equity--
Fiscal years ended January 29, 1994, January 30, 1993 and
February 1, 1992
Notes to Consolidated Financial Statements
The following consolidated financial statement schedules of
Strawbridge & Clothier and subsidiaries are included herein:
Schedule V--Property, Plant and Equipment
Schedule VI--Accumulated Depreciation, Depletion and
Amortization of Property, Plant and Equipment
Schedule VIII--Valuation and Qualifying Accounts
Schedule IX--Short-Term Borrowings
Schedule X--Supplementary Income Statement Information
All other schedules for which provision is made in the applicable
accounting regulation of the Securities and Exchange Commission
are not required under the related instructions or are
inapplicable, and therefore have been omitted.
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<TABLE>
Strawbridge & Clothier and Subsidiaries
Schedule V--Property, Plant, and Equipment
(in thousands)
<CAPTION>
COL. A COL. B COL. C COL. D COL. E COL. F
Balance at Other Changes Balance at
Classification Beginning Additions Add (Deduct)-- End
of Period at Cost Retirements Describe (1) of Period
<S> <C> <C> <C> <C> <C>
Fiscal year ended
January 29, 1994
Land $ 20,363 $ $ $ $ 20,363
Buildings 285,026 4,684 180 57 289,587
Fixtures and equipment 215,057 11,934 2,385 741 225,347
Transportation equipment 563 105 42 626
Leasehold improvements 44,432 4,941 339 41 49,075
Construction in progress 4,141 1,085 436 (839) 3,951
Totals $569,582 $22,749 $3,382 $ $588,949
Fiscal year ended
January 30, 1993
Land $ 20,363 $ $ $ $ 20,363
Buildings 271,009 11,563 2,454 285,026
Fixtures and equipment 205,288 7,877 485 2,377 215,057
Transportation equipment 562 49 48 563
Leasehold improvements 43,520 779 36 169 44,432
Construction in progress 6,797 2,649 305 (5,000) 4,141
Totals $547,539 $22,917 $874 $ $569,582
<PAGE>
Fiscal year ended
February 1, 1992
Land $ 19,538 $ 825 $ $ $ 20,363
Buildings 259,964 9,099 112 2,058 271,009
Fixtures and equipment 197,776 9,806 5,536 3,242 205,288
Transportation equipment 544 41 23 562
Leasehold improvements 40,784 1,595 1,141 43,520
Construction in progress 13,633 3,852 218 (10,470) (2) 6,797
Totals
$532,239 $25,218 $5,889 $( 4,029) $547,539
<FN>
(1) Transfers between property accounts.
(2) Includes reimbursement by lessor of $4,029 for new store construction.
Note: The annual provisions for depreciation have been computed based upon the
following ranges of useful lives:
Buildings and leasehold improvements - 5 to 60 years
Fixtures and equipment and transportation equipment - 4 to 16-2/3 years
</TABLE>
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<TABLE>
Strawbridge & Clothier and Subsidiaries
Schedule VI--Accumulated Depreciation, Depletion, and
Amortization of Property, Plant, and Equipment
(in thousands)
<CAPTION>
COL. A COL. B COL. C COL. D COL. E COL.F
Other
Additions Changes
Balance at Charged to Add Balanceat
Beginning Costs and (Deduct)-- End
Description of Period Expenses Retirements Describe ofPeriod
<S> <C> <C> <C> <C> <C>
Fiscal year ended Janaury
29, 1994
Buildings $ 99,274 $ 9,834 $ 186 $ $108,922
Fixtures and equipment 146,296 16,512 2,124 160,684
Transportation equipment 409 75 28 456
Leasehold improvements 16,446 2,408 335 18,519
Totals $262,425 $28,829 $2,673 $ $288,581
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Fiscal year ended January
30, 1993
Buildings $ 89,985 $ 9,289 $ $ $99,274
Fixtures and equipment 130,145 16,635 484 146,296
Transportation equipment 386 71 48 409
Leasehold improvements 14,147 2,327 28 16,446
Totals $234,663 $28,322 $560 $ $262,425
Fiscal year ended February
1, 1992
Buildings $ 81,294 $ 8,740 $ 49 $ $89,985
Fixtures and equipment 116,597 17,703 4,155 130,145
Transportation equipment 335 74 23 386
Leasehold improvements 11,954 2,193 14,147
Totals $210,180 $28,710 $4,227 $ $234,663
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</TABLE>
<TABLE>
Strawbridge & Clothier and Subsidiaries
Schedule VIII--Valuation and Qualifying Accounts
(in thousands)
<CAPTION>
COL. A COL. B COL. C COL. D COL. E
Additions
Balance at Charged to Charged to Balance at
Description Beginning Costs and Other Deductions- End
of Period Expenses Accounts-- - of Period
Describe Describe
<S> <C> <C> <C> <C> <C>
Fiscal year ended
January 29, 1994
Reserves and allowances
deducted
From asset accounts:
Allowance for doubtful
accounts $5,000 $4,724 $ $4,724 (1) $5,000
Fiscal year ended
January 30, 1993
Reserves and allowances
deducted
from asset accounts:
Allowance for doubtful
accounts $5,000 $6,638 $ $6,638 (1) $5,000
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Fiscal year ended
February 1, 1992
Reserves and allowances
deducted
from asset accounts:
Allowance for doubtful
accounts $4,200 $7,332 $ $6,532 (1) $5,000
<FN>
(1) Accounts written off during year, net of recoveries.
</TABLE>
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<TABLE>
Strawbridge & Clothier and Subsidiaries
Schedule IX--Short-Term Borrowings
(in thousands)
<CAPTION>
COL. A COL. B COL. C COL. D COL. E COL. F
Maximum Average Weighted
Weighted Amount Amount Average
Balance at Average Outstanding Outstanding Interest Rate
Category of Aggregate End Interest During the During the During the
Short-Term Borrowings of Period Rate Period Period (2) Period (3)
<S> <C> <C> <C> <C> <C>
Fiscal year ended January
29, 1994
Notes payable to banks (1) $43,500 3.59% $96,500 $50,578 3.72%
Fiscal year ended January
30, 1993
Notes payable to banks (1) $27,500 3.71% $86,000 $53,665 4.51%
Fiscal year ended February
1, 1992
Notes payable to banks (1) $32,000 5.05% $73,000 $42,402 6.12%
8 <PAGE>
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<FN>
(1) Represents amounts outstanding under short-term
bank credit lines which have no termination date, but are reviewed periodically for
renewal.
(2) The average amount outstanding during the period
is the daily average of outstanding principal balances.
(3) The weighted average interest rate during the
period was computed by dividing the actual interest expense by average short-term
debt outstanding.
</TABLE>
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Strawbridge & Clothier and Subsidiaries
Schedule X--Supplementary Income Statement Information
(in thousands)
COL. A COL. B
Item Charged to Costs and Expenses
Fiscal Year
1993 1992 1991
Advertising costs $28,835 $25,886 $25,971
Amounts for maintenance and repairs, depreciation and
amortization of intangible assets, taxes, other than payroll and
income taxes, and royalties are not presented because the
registrant does not incur such expenses or because such amounts
are less than 1% of total sales and revenues.
10 <PAGE>
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Exhibit Index
Exhibit No. Page No.
(10.4.2)
Schedule of certain terms of
Employment Agreements for the
executive officers named in the
Company's Summary Compensation Table
for the fiscal year ended January 29,
1994.
(11)
Statement re: Computation of per
share earnings.
(13)
Portions of the 1993 Annual Report to
Shareholders, included as part of this
Report.
(23)
Consent of Ernst & Young, Independent
Auditors.
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EXHIBIT 10.4.2
SCHEDULE OF CERTAIN TERMS OF
EMPLOYMENT AGREEMENTS FOR THE EXECUTIVE
OFFICERS NAMED IN THE COMPANY'S SUMMARY COMPENSATION
TABLE FOR THE FISCAL YEAR ENDED JANUARY 29, 1994
Three-Year Term
Executive Officer Salary Commencing
Peter S. Strawbridge $310,000 January 31,
1993
Francis R. Strawbridge, III 300,000
January 31,
Warren W. White 260,000 1993
Robert G. Muskas 180,000 January 31,
1993
Natalie B. Weintraub 177,000
January 31,
1993
January 31,
1993
<PAGE>
<TABLE>
Strawbridge & Clothier and Subsidiaries
Exhibit 11--Statement re: Computation of Per Share Earnings
<CAPTION>
Year ended
January 29, January 30, February 1,
1994 1993 1992
(in thousands, except per share data)
<S> <C> <C> <C>
Primary
Average shares outstanding 10,316 10,196 10,074
Net effect of dilutive stock options--based on
the treasury stock method using average market price 8 20 25
Total 10,324 10,216 10,099
Earnings before cumulative effect of accounting changes $17,727 $18,020 $13,568
Less: preferred stock dividends 17 26 35
17,710 17,994 13,533
Cumulative effect of accounting changes (16,850)
Total $17,710 $ 1,144 $13,533
Earnings per share:
Before cumulative effect of accounting changes $1.71 $1.76 $1.34
Cumulative effect of accounting changes (1.65)
Net earnings $1.71 $.11 $1.34
Fully diluted
Average shares outstanding 10,316 10,196 10,074
Net effect of dilutive stock options--based on
the treasury stock method using the year-end market
price, if higher than average market price 9 23 25
<PAGE>
Total 10,325 10,219 10,099
Earnings before cumulative effect of accounting changes $17,727 $18,020 $13,568
Less: preferred stock dividends 17 26 35
17,710 17,994 13,533
Cumulative effect of accounting changes (16,850)
Total $17,710 $ 1,144 $13,533
Earnings per share:
Before cumulative effect of accounting changes $1.71 $ 1.76 $1.34
Cumulative effect of accounting changes (1.65)
Net earnings (1) $1.71 $.11 $1.34
<FN>
(1) This calculation is submitted in accordance with the
requirements of Regulation S-K although not required by APB
Opinion No. 15 because it results in dilution of less than 3%.
</TABLE>
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Exhibit 23
Consent of Ernst & Young, Independent Auditors
We consent to the incorporation by reference in this Annual
Report (Form 10-K) of Strawbridge & Clothier of our report dated
March 23, 1994, included in the 1993 Annual Report to
Shareholders of Strawbridge & Clothier.
Our audits also included the financial statement schedules of
Strawbridge & Clothier listed in Item 14(a). These schedules are
the responsibility of the Company's management. Our
responsibility is to express an opinion on these schedules based
on our audits. In our opinion, the financial statement schedules
referred to above, when considered in relation to the basic
financial statements taken as a whole, present fairly in all
material respects the information set forth therein.
We consent to the incorporation by reference in Registration
Statement No. 2-99396 on Form S-8 dated August 22, 1985,
Registration Statement No. 33-37675 on Form S-8 dated November 8,
1990, Registration Statement No. 33-40928 on Form S-8 dated May
29, 1991, and Registration Statement No. 33-55782 on Form S-3
dated December 15, 1992, and the related Prospectuses of
Strawbridge & Clothier of our report dated March 23, 1994, with
respect to the consolidated financial statements incorporated
herein by reference and our report included in the preceding
paragraph with respect to the financial statement schedules
included in the 1993 Annual Report (Form 10-K) of Strawbridge &
Clothier.
ERNST & YOUNG
Philadelphia, Pennsylvania
April 22, 1994
1 <PAGE>
<PAGE>
STRAWBRIDGE & CLOTHIER
PORTIONS OF THE
1993 ANNUAL REPORT TO SHAREHOLDERS
CONSOLIDATED STATEMENTS
OF OPERATIONS
(in thousands, except number of shares and per share data)
- ------------------------------------------------------------------------------
Year Ended
----------------------------------------
JANUARY 29 January 30 February 1
1994 1993 1992
---------- ---------- ----------
Net sales, including leased
department sales ................. $984,615 $967,794 $967,786
Other income, net of other
deductions ....................... 2,412 1,061 842
-------- -------- --------
987,027 968,855 968,628
Deduct:
Cost of sales, including occupancy
and buying costs ............... 733,901 718,582 718,927
Selling and administrative
expenses, net of finance
charges ........................ 171,835 166,678 169,897
Depreciation ..................... 28,829 28,322 28,710
Interest ......................... 20,909 21,446 23,048
Provision for doubtful accounts .. 4,724 6,638 7,332
-------- -------- --------
960,198 941,666 947,914
-------- -------- --------
Earnings before income taxes and
cumulative effect of accounting
changes .......................... 26,829 27,189 20,714
Income taxes ....................... 9,102 9,169 7,146
-------- -------- --------
Earnings before cumulative effect
of accounting changes ............ 17,727 18,020 13,568
Cumulative effect of accounting
changes:
Income taxes ................... -0- 9,750 -0-
Retiree health care, net of
$13,600 income taxes ......... -0- (26,600) -0-
-------- -------- --------
-0- (16,850) -0-
-------- -------- --------
NET EARNINGS ....................... $ 17,727 $ 1,170 $ 13,568
======== ======== ========
Earnings per share:
Before cumulative effect of
accounting changes ............. $1.71 $1.76 $1.34
Accounting changes ............... -0- (1.65) -0-
-------- -------- --------
Net earnings ..................... $1.71 $ .11 $1.34
======== ======== ========
Average shares outstanding ......... 10,324,048 10,215,742 10,099,214
See accompanying notes.
3
<PAGE>
CONSOLIDATED
BALANCE SHEETS
(in thousands, except number of shares and per share data)
- ------------------------------------------------------------------------------
Assets
JANUARY 29 January 30
1994 1993
---------- ----------
CURRENT ASSETS
Cash and equivalents ............................. $ 2,860 $ 5,372
Accounts receivable .............................. 205,433 184,417
Allowance for doubtful accounts ................ (5,000) (5,000)
-------- --------
200,433 179,417
Merchandise inventories .......................... 143,132 144,961
Deferred income taxes ............................ 2,397 4,642
Prepaid expenses and other ....................... 7,379 8,072
-------- --------
TOTAL CURRENT ASSETS ............................. 356,201 342,464
PROPERTY, FIXTURES AND EQUIPMENT --
on the basis of cost
Land ............................................. 20,363 20,363
Buildings and improvements ....................... 338,662 329,458
Store fixtures, furniture and equipment .......... 225,973 215,620
Allowance for depreciation (deduction) ........... (288,581) (262,424)
-------- --------
296,417 303,017
Construction in progress ......................... 3,951 4,141
-------- --------
300,368 307,158
OTHER ASSETS ..................................... 6,483 4,317
-------- --------
$663,052 $653,939
======== ========
4
<PAGE>
- ------------------------------------------------------------------------------
Liabilities, Preferred Stock
and Common Shareholders' Equity JANUARY 29 January 30
1994 1993
---------- ----------
CURRENT LIABILITIES
Notes payable to banks ........................... $ 43,500 $ 27,500
Accounts payable ................................. 60,138 61,084
Accrued expenses ................................. 20,724 20,743
Federal, state and local taxes ................... 11,203 10,689
Long-term debt and capital lease obligations
due within one year ............................ 11,055 9,934
-------- --------
TOTAL CURRENT LIABILITIES ........................ 146,620 129,950
LONG-TERM DEBT -- due after one year ............. 162,254 171,617
CAPITAL LEASE OBLIGATIONS -- due after one year .. 43,554 52,030
ACCRUED RETIREMENT COSTS ......................... 49,795 46,700
DEFERRED INCOME TAXES ............................ 3,355 5,135
OTHER LIABILITIES ................................ 4,976 5,194
PREFERRED STOCK .................................. 296 474
SERIES PREFERRED STOCK -- no par value:
authorized -- 2,000,000 shares; none issued .... -0- -0-
COMMON SHAREHOLDERS' EQUITY
Series A Common Stock -- par value $1 a share:
authorized -- 20,000,000 shares; issued and
outstanding 1993 -- 7,151,254 shares, 1992 --
6,761,104 shares ............................... 7,151 6,761
Series B Common Stock -- par value $1 a share,
convertible: authorized -- 20,000,000 shares;
issued and outstanding 1993 -- 3,235,149 shares,
1992 -- 3,196,369 shares ....................... 3,235 3,196
Capital in addition to par value of shares ....... 167,024 157,591
Retained earnings ................................ 74,792 75,291
-------- --------
TOTAL COMMON SHAREHOLDERS' EQUITY ................ 252,202 242,839
-------- --------
$663,052 $653,939
======== ========
See accompanying notes.
5
<PAGE>
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(in thousands)
- ------------------------------------------------------------------------------
Year Ended
----------------------------------------
JANUARY 29 January 30 February 1
1994 1993 1992
---------- ---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings ....................... $ 17,727 $ 1,170 $ 13,568
Adjustments to reconcile net
earnings to cash flows from
operating activities:
Provision for depreciation ..... 28,829 28,322 28,710
Provision for deferred income
taxes ........................ 502 (1,309) (2,113)
Cumulative effect of accounting
changes ...................... -0- 16,850 -0-
Changes in:
Accounts receivable .......... (21,016) (11,443) (5,327)
Merchandise inventories ...... 1,829 (11,690) 5,561
Accounts payable and accrued
expenses ................... (965) 4,021 1,029
Federal, state and local
taxes ...................... 514 2,713 (396)
Other ........................ 4,240 (461) 2,906
-------- -------- --------
TOTAL .............................. 31,660 28,173 43,938
-------- -------- --------
NET CASH USED FOR
INVESTING ACTIVITIES
Acquisition of property, fixtures
and equipment .................... (22,076) (22,588) (16,362)
Changes in other assets ............ (879) 389 3,225
-------- -------- --------
TOTAL .............................. (22,955) (22,199) (13,137)
-------- -------- --------
NET CASH USED FOR
FINANCING ACTIVITIES
Additional borrowings .............. 49,255 25,000 9,395
Payment of long-term debt and
capital lease obligations ........ (66,718) (12,303) (19,348)
Increase (decrease) in short-term
notes payable .................... 16,000 (4,500) (13,500)
Purchase of preferred stock and
treasury stock ................... (205) (190) (174)
Proceeds from issuance of common
stock ............................ 1,431 1,658 1,871
Cash dividends ..................... (10,980) (13,080) (7,550)
-------- -------- --------
TOTAL .............................. (11,217) (3,415) (29,306)
-------- -------- --------
CHANGE IN CASH AND EQUIVALENTS ..... (2,512) 2,559 1,495
Cash and equivalents at beginning
of year .......................... 5,372 2,813 1,318
-------- -------- --------
CASH AND EQUIVALENTS AT END
OF YEAR .......................... $ 2,860 $ 5,372 $ 2,813
======== ======== ========
See accompanying notes.
6
<PAGE>
CONSOLIDATED STATEMENTS OF
COMMON SHAREHOLDERS' EQUITY
(in thousands, except per share data)
- ------------------------------------------------------------------------------
CAPITAL
IN
SERIES SERIES ADDITION TREASURY
A B TO PAR STOCK
COMMON COMMON VALUE OF RETAINED (DEDUC-
STOCK STOCK SHARES EARNINGS TION) TOTAL
------ ------ -------- -------- ------- --------
Balance, February 2, 1991..$5,916 $3,241 $139,077 $ 95,919 $ -0- $244,153
Net earnings .............. 13,568 13,568
Cash dividends --
common (per share:
$1.03 Series A;
$.92 Series B) .......... (10,067) (10,067)
Cash dividends --
preferred ................ (35) (35)
Stock dividend (three
percent) ................. 178 97 7,349 (7,624) -0-
Exercise of stock options,
employee stock purchases,
and contribution to
Retirement Savings Plan... 146 1 2,782 8 2,937
Conversions ............... 48 (48) -0-
Treasury stock purchases... (8) (8)
------ ------ -------- -------- ----- --------
Balance, February 1, 1992.. 6,288 3,291 149,208 91,761 -0- 250,548
Net earnings .............. 1,170 1,170
Cash dividends --
common (per share:
$1.07 Series A;
$.96 Series B) .......... (10,502) (10,502)
Cash dividends --
preferred ................ (26) (26)
Stock dividend (three
percent) ................. 193 94 6,825 (7,112) -0-
Exercise of stock options
and employee stock
purchases ................ 91 1,558 1 1,650
Conversions ............... 189 (189) -0-
Treasury stock purchases... (1) (1)
------ ------ -------- -------- ----- --------
Balance, January 30, 1993.. 6,761 3,196 157,591 75,291 -0- 242,839
Net earnings .............. 17,727 17,727
Cash dividends --
common (per share:
$1.08 Series A;
$.99 Series B)............ (10,963) (10,963)
Cash dividends --
preferred ................ (17) (17)
Stock dividend (three
percent) ................. 203 96 6,947 (7,246) -0-
Exercise of stock options,
employee stock purchases,
and contribution to
Retirement Savings Plan... 127 3 2,486 18 2,634
Conversions ............... 60 (60) -0-
Treasury stock purchases... (18) (18)
------ ------ -------- -------- ----- --------
Balance, January 29, 1994..$7,151 $3,235 $167,024 $ 74,792 $ -0- $252,202
====== ====== ======== ======== ===== ========
See accompanying notes.
7
<PAGE>
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
The Company operates 38 retail stores, including department and self-service
stores, which sell general merchandise in Philadelphia and the surrounding
Delaware Valley area of Southeastern Pennsylvania, Southern New Jersey and
Northern Delaware. The Company grants credit to customers, substantially all
of whom are residents of its trading area.
1. SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation: The consolidated financial statements include the
accounts of the Company and its wholly-owned subsidiaries. All intercompany
transactions have been eliminated.
Inventories: Merchandise inventories are priced at cost on the last-in,
first-out method.
Store Preopening Costs: Such costs are charged to expense in the year
incurred.
Property, Fixtures and Equipment: Property, fixtures and equipment are
recorded at cost, which is depreciated by the straight-line method over the
estimated useful lives of the assets.
Cash Equivalents: For purposes of the statement of cash flows, the Company
considers all highly liquid investments with maturities of three months or
less when purchased to be cash equivalents.
Per Share Data: Earnings per share amounts are based on the weighted average
number of shares of common stock and common stock equivalents (employee stock
options) outstanding during each fiscal year, after recognition of Preferred
Stock dividends.
Accounting Changes: During 1992, the Company changed its methods of accounting
for LIFO inventories (Note 2), retiree health care benefits (Note 4) and
income taxes (Note 7).
2. INVENTORIES
If the first-in, first-out method of determining inventory cost had been used,
inventories would have been $34,180,000 and $35,420,000 higher than reported
at January 29, 1994 and January 30, 1993, respectively.
During 1992, the Company changed its method of determining retail price
indices used in the valuation of most of its LIFO inventories. Prior to 1992,
the Company used the U.S. Department of Labor's Department Store Price
Indexes to measure inflation in retail prices for all inventories. In 1992,
the Company developed and used internal price indices to measure inflation in
the retail prices of certain merchandise inventories. The Company believes
internal indices more accurately measure inflation in the Company's retail
prices for these inventories. This change reduced 1992 cost of sales by
$3,948,000 compared to the prior method, resulting in an after-tax benefit of
$2,606,000, or $.26 per share. The Company was not able to determine the
cumulative effect of this change nor the impact on any individual year prior
to 1992.
3. LONG-TERM DEBT AND SHORT-TERM BORROWINGS
Long-term debt -- due after one year consists of the following (in thousands):
JANUARY 29 January 30
1994 1993
---------- ----------
6.625% notes due October 15, 2003 ................ $ 49,580 $ -0-
8.75% notes due November 15, 1996 ................ -0- 50,000
Series A Senior Notes, maturing equally from
1994 to 2004 with interest at 9.2% ............. 27,273 30,000
Series B Senior Notes, due September 30, 1999
with interest at 9.0% .......................... 20,000 20,000
Mortgage notes payable, at rates ranging from
8.50% to 10%, due in installments of $2,922
annually, including principal and interest,
maturing from 4 to 14 years .................... 16,310 21,162
Senior Note, due October 15, 1997 with
interest at 7.04% .............................. 25,000 25,000
Notes payable to bank under revolving credit
agreement with interest at 3.80% at January
29, 1994 and 3.71% at January 30, 1993 ......... 20,000 20,000
Senior Notes maturing equally from 1994 to
1997 with interest at 11.5% .................... 4,091 5,455
-------- --------
$162,254 $171,617
======== ========
Among other things, certain loan agreements require that the Company
maintain a ratio of current assets to current liabilities of not less
than 1.5.
8
<PAGE>
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (CONTINUED)
- ------------------------------------------------------------------------------
Certain agreements restrict transactions reducing shareholders' equity and
the amount available for such transactions at January 29, 1994 is
$42,315,000. Fixed assets with a net book value of $32,890,000 are
mortgaged by certain agreements.
The carrying amounts of the Company's borrowings under its short-term bank
credit lines approximate their fair values. The fair value of the
Company's long-term debt (including the current portion thereof) is
approximately $170,000,000 at January 29, 1994 while the carrying amount is
$167,723,000. Fair values were estimated using discounted cash flow
analyses, based on the Company's incremental borrowing rates for similar
types of borrowing arrangements. The excess of fair values over recorded
amounts results because contractual borrowing rates exceed current rates on
certain loans.
Under the revolving credit agreement, the Company may borrow up to
$20,000,000 through October 31, 1995 with various interest rate options.
The Company pays a commitment fee equal to 1/4% per annum on the unused
portion of the total commitment.
The Company has unused short-term bank credit lines which are subject to
annual confirmation and which aggregated $8,000,000 at January 29, 1994.
There are no compensating balance arrangements in connection with debt or
credit lines.
Maturities of long-term debt for the next five fiscal years are as follows:
1994 -- $5,469,000; 1995 -- $25,733,000; 1996 -- $5,744,000; 1997 --
$30,592,000; 1998 -- $4,032,000.
Interest paid, net of amounts capitalized, was: 1993 -- $21,050,000; 1992 --
$21,242,000; 1991 -- $23,156,000.
During 1991, the Company purchased land and a building for $4,600,000, the
cost of which was financed by the seller.
4. RETIREMENT BENEFITS
Defined Benefit Plans: The Company provides pension benefits for
substantially all regular employees under noncontributory defined benefit
pension plans. Benefits are determined based on average compensation or
years of service. The Company's funding policy is to contribute amounts
consistent with the minimum funding standards of the Employee Retirement
Income Security Act of 1974. Plan assets consist primarily of common
equity funds, stocks and fixed income securities.
Net pension cost included the following components (in thousands):
1993 1992 1991
-------- -------- --------
Service cost -- benefits earned
during the period .................. $ 2,488 $ 2,263 $ 1,874
Interest cost on projected benefit
obligation ......................... 6,562 6,137 5,685
Actual (return) on plan assets ....... (10,164) (7,887) (15,663)
Net amortization and deferral ........ 3,601 1,595 10,475
-------- -------- --------
Net pension cost ..................... $ 2,487 $ 2,108 $ 2,371
======== ======== ========
The expected long-term rate of return on plan assets used in determining
net pension cost was 9 percent.
The following table sets forth the funded status and amounts recognized in
the Company's consolidated balance sheets for the Strawbridge & Clothier
Employees Retirement Benefit Plan (in thousands):
1993 1992
------- --------
Actuarial present value of benefit obligations:
Vested ......................................... $65,593 $ 58,212
======= ========
Accumulated .................................... $67,004 $ 59,464
======= ========
Projected ...................................... $80,084 $ 72,106
Plan assets at fair value......................... 82,989 77,300
------- --------
Plan assets in excess of projected benefit
obligation ..................................... 2,905 5,194
Items not yet recognized:
Net gain ....................................... (9,165) (10,793)
Net obligation at transition ................... 394 450
Prior service cost ............................. 2,940 3,254
------- --------
Accrued pension cost included in consolidated
balance sheets ................................. $(2,926) $ (1,895)
======= ========
The following assumptions were used in determining the actuarial present
value of the projected benefit obligation:
1993 1992
------- --------
Weighted average discount rate ................... 7.50% 8.25%
Rate of increase in compensation levels .......... 5.5% 6%
9
<PAGE>
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (CONTINUED)
- ------------------------------------------------------------------------------
The Company also sponsors an unfunded, nonqualified Deferred Compensation
Plan, which provides retirement benefits for certain key executive
officers. The accrued liability for this plan is included in accrued
retirement costs in the accompanying balance sheets. At December 31, 1993,
the accumulated benefit obligation for this plan was $8,569,000, and the
projected benefit obligation was $8,942,000.
401(k) Plan: The Company has a 401(k) Retirement Savings Plan, under which
employees may defer a portion of their compensation. Contingent upon there
having been an increase in the Company's net earnings, as defined under the
Plan, for the fiscal year ending within the Plan year, employee
contributions not in excess of 4% of a participant's compensation will be
matched by the Company at the rate of $.50 for each $1.00 contributed.
Matching expense was $479,000, $732,000 and $420,000 for 1993, 1992 and
1991, respectively. All Company matching contributions are invested in a
separate fund comprised of the Company's Series A Common Stock, 250,000
shares of which have been reserved for use under the 401(k) Plan.
Retiree Health Care Plan: The Company provides certain health care benefits
for eligible retired employees. The retiree health care plan is
noncontributory for retirees who were full-time regular employees of the
Company and retired prior to January 1, 1993. For eligible employees
retiring on or after January 1, 1993, with fifteen years of service, the
plan is contributory with retiree contributions based on years of service.
Cost-sharing features include deductibles and co-payment provisions. For
certain participants, the Plan limits the amount of future cost increases
that will be paid by the Company. Employees hired on or after January 1,
1993 are not eligible for retiree health care benefits. The Plan is funded
on a pay-as-you-go basis.
Effective February 2, 1992, the Company adopted the provisions of FASB
Statement No. 106, "Employers' Accounting for Postretirement Benefits Other
Than Pensions." This new statement requires that the expected cost of
retiree health care benefits be charged to expense during the years that
the employees render service. The Company's past practice was to recognize
these costs on a cash basis. As part of adopting the new standard, as of
February 2, 1992, the Company recorded a one-time, noncash charge against
earnings of $40,200,000 before taxes and $26,600,000 after taxes, or $2.60
per share. This cumulative catch-up adjustment as of February 2, 1992
represents the discounted present value of expected future retiree health
care benefits attributed to employees' service rendered prior to that date.
Also, the new standard resulted in additional annual expense for 1992 of
$1,300,000 before taxes and $860,000 after taxes, or $0.08 per share.
Prior-year financial statements have not been restated to apply the new
standard. Postretirement benefit expense for 1991, recorded on the cash
basis, was $1,700,000.
The following table presents the status of the Plan and the amounts
recognized in the Company's consolidated balance sheets (in thousands):
1993 1992
------- --------
Actuarial present value of accumulated
postretirement benefit obligation:
Retirees ..................................... $25,013 $32,580
Active plan participants ..................... 6,905 8,920
------- -------
31,918 41,500
Unrecognized net actuarial gain................... 11,203 -0-
------- =======
Accrued postretirement benefit cost included
in consolidated balance sheets ................. $43,121 $41,500
======= =======
Postretirement benefit expense included the following components (in
thousands):
1993 1992
------- -------
Service cost ................................. $ 603 $ 580
Interest cost ................................ 3,437 3,310
------- -------
$ 4,040 $ 3,890
======= =======
The following assumptions were used in determining the accumulated
postretirement benefit obligation:
1993 1992
------- -------
Discount rate ................................. 7.5% 8.5%
Health care cost trend rate:
Initial rate 13.0% 13.4%
Ultimate rate ................................ 6.0% 7.0%
Period to ultimate rate ...................... 7 YEARS 9 years
The health care cost trend rate assumption has a significant effect on the
amounts reported. For example, increasing the assumed health care cost
trend
10
<PAGE>
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (CONTINUED)
- ------------------------------------------------------------------------------
rates by one percentage point would increase the accumulated
postretirement benefit obligation as of January 29, 1994 by $2,777,000 and
the aggregate of the service and interest cost components of postretirement
benefit expense for 1993 by $326,000.
5. PREFERRED STOCK
The Preferred Stock ($100 par value) provides for $5 cumulative dividends
and redemption at $105 per share (1993 -- $311,000; 1992 -- $498,000).
Sinking fund provisions require that on April 1 of each year, the Company
shall redeem shares of at least $179,900 in par value. Par value of shares
redeemed and retired was as follows: 1993 -- $180,300; 1992 -- $180,200;
1991 -- $186,200. Outstanding shares at fiscal year ends were: 1993 --
2,961; 1992 -- 4,742; 1991 -- 6,549.
6. COMMON STOCK
Series A and Series B shares are entitled to one and ten votes per share,
respectively. Series B shares are convertible on a share-for-share basis
into Series A shares. Series A shares are freely transferable while Series
B shares are only transferable to certain permitted transferees. Series A
Common Stock is entitled to cash dividends at least 10% higher than any
cash dividend declared on Series B Common Stock.
The Company offers Series A Common Stock to employees for purchase through
payroll deductions under its 1991 Employee Stock Purchase Plan. The
purchase price is 85% of the closing market price on the offering date or
the purchase date, whichever is lower. During fiscal 1993, 1992 and 1991,
respectively, 74,499, 91,183 and 105,686 shares were issued under the Plan
at average prices of $19.23, $18.19 and $17.38. As of January 29, 1994,
478,598 shares of Series A Common Stock were available for use under
the Plan.
The Company also has stock option plans which provide for granting to key
employees qualified and nonqualified options to purchase common stock of
the Company. Generally, options are granted for a term of ten years and
become exercisable immediately. During fiscal 1993, 1992 and 1991,
respectively, 3,154 shares, 95 shares and 1,542 shares were issued upon
exercise of options at average prices of $22.46, $23.53 and $23.53.
Options to purchase 469,581 shares of Series A Common Stock and 146,020
shares of Series B Common Stock at an average exercise price of $25.15 were
outstanding at January 29, 1994, of which 456,850 and 146,020 options,
respectively, were exercisable. As of January 29, 1994, 69,210 shares of
Series A Common Stock remain available for grant of options.
Effective in fiscal 1993, the Company established a dividend reinvestment
and stock purchase plan, whereby shareholders may invest cash dividends and
optional cash payments in Series A Common Stock. The Company has
registered 2,060,000 shares for issuance under the plan, of which 2,050,513
remain available for issuance at January 29, 1994.
7. INCOME TAXES
Effective February 2, 1992, the Company changed its method of accounting
for income taxes from the deferred method to the liability method required
by FASB Statement No. 109, "Accounting for Income Taxes." As permitted
under the new rules, prior years' financial statements were not restated.
The cumulative effect of adopting Statement 109 as of February 2, 1992 was
to increase 1992 net earnings by $9,750,000, or $.95 per share.
Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes. The
components of deferred tax liabilities and assets are as follows (in
thousands):
1993 1992
------- -------
Deferred tax liabilities:
Depreciation ................................ $22,334 $23,295
Other -- net ................................ 3,747 741
------- -------
26,081 24,036
Deferred tax assets:
Retiree health care obligation .............. 15,096 14,042
Accruals and reserves ....................... 10,027 9,501
------- -------
25,123 23,543
------- -------
Net deferred tax liabilities .................... $ 958 $ 493
======= =======
11
<PAGE>
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS (CONTINUED)
- ------------------------------------------------------------------------------
The components of income tax expense attributable to earnings before
cumulative effect of accounting changes are as follows (in thousands):
Deferred
Liability Method Method
1993 1992 1991
--------- ------ --------
Current:
Federal ....................... $8,299 $10,172 $ 7,837
State ......................... 301 306 1,422
------ ------- -------
8,600 10,478 9,259
Deferred:
Federal ....................... 146 (1,163) (1,641)
State ......................... 356 (146) (472)
------ ------- -------
502 (1,309) (2,113)
------ ------- -------
$9,102 $ 9,169 $ 7,146
====== ======= =======
The components of the deferred income tax benefit for fiscal 1991 are as
follows (in thousands):
1991
-------
Depreciation .................................. $ (413)
Other, principally nondeductible expenses ..... (1,700)
-------
$(2,113)
=======
A reconciliation of the effective income tax rate with the statutory
federal income tax rate is as follows:
Deferred
Liability Method Method
1993 1992 1991
--------- ------ --------
Federal tax rate ................. 35.0% 34.0% 34.0%
State taxes, net of federal
benefit......................... 1.6 0.4 3.0
Jobs tax credit .................. (1.9) (1.2) (2.9)
Other ............................ (0.8) 0.5 0.4
---- ---- ----
33.9% 33.7% 34.5%
==== ==== ====
Income taxes paid were as follows: 1993 -- $8,587,000; 1992 -- $8,465,000;
1991 -- $9,978,000.
8. COMMITMENTS
Leases:
Capital lease assets, which are included in property, fixtures and
equipment, are as follows (in thousands):
JANUARY 29 January 30
1994 1993
---------- ----------
Land ........................................ $ 2,696 $ 2,926
Buildings ................................... 75,027 78,823
Store fixtures and equipment ................ 3,887 5,288
-------- --------
81,610 87,037
Allowance for amortization
(deduction) ............................... (36,550) (36,844)
-------- --------
$ 45,060 $ 50,193
======== ========
Amortization of capital lease assets is included in depreciation expense.
Future minimum rental commitments as of January 29, 1994, for all
noncancelable leases are as follows (in thousands):
Capital Operating
Fiscal Year Leases* Leases*
- ----------- -------- ---------
1994 ...................... $ 9,618 $ 5,090
1995 ...................... 6,471 4,407
1996 ...................... 6,502 3,620
1997 ...................... 6,523 3,199
1998 ...................... 6,556 3,146
Thereafter ................ 44,872 20,655
-------- -------
Total minimum rental
commitments ............. 80,542 $40,117
=======
Estimated executory costs.. (1,296)
Imputed interest .......... (30,106)
--------
Present value of net
minimum lease payments .. $ 49,140
========
*These amounts have not been reduced by future noncancelable sublease
rentals of $6,956.
All real estate leases include renewal options for periods ranging from
5 to 100 years. Most of these leases include options to purchase at
specified times. In most instances, the Company pays real estate taxes,
insurance and maintenance costs. There are no guarantees, related
obligations or restrictions in connection with the lease agreements.
Total net rental expense amounted to (in thousands):
1993 1992 1991
------ ------ -------
Minimum rentals ...................... $5,861 $6,802 $ 5,949
Contingent rentals, based on sales ... 1,288 1,276 1,284
Sublease rentals ..................... (831) (659) (913)
------ ------ -------
$6,318 $7,419 $ 6,320
====== ====== =======
Other:
Estimated cost to complete construction in progress at January 29, 1994 is
approximately $3,300,000.
12
<PAGE>
STATEMENT OF MANAGEMENT RESPONSIBILITY
- ------------------------------------------------------------------------------
Strawbridge & Clothier management is responsible for the financial
statements and information presented in this Annual Report. The financial
statements have been prepared in conformity with generally accepted
accounting principles and include certain amounts based on management's
best estimates and judgements.
The Company maintains a system of internal accounting controls, which
provides for appropriate division of responsibility and the application of
written policies and procedures. The system is designed to provide
reasonable assurance, at suitable costs, that assets are safeguarded and
that transactions are executed in accordance with appropriate authorization
and are recorded and reported properly. An important element of the
internal control environment is an ongoing internal audit program.
The financial statements have been audited by Ernst & Young, independent
auditors, whose report appears below. Their audit includes an evaluation
of the internal control structure and selected tests of transactions and
records. Their audit is intended to provide a reasonable level of
assurance that the financial statements are free of material misstatement.
The Audit Committee of the Board of Directors is responsible for
recommending the independent auditors to be retained for the coming year,
subject to shareholder approval. The Audit Committee meets periodically
with the independent auditors and the internal auditors to consider the
scope and results of their audits and to discuss other significant matters
regarding internal accounting controls and financial reporting. The
independent auditors and the internal auditors have unrestricted access to
the Audit Committee.
REPORT OF ERNST & YOUNG, INDEPENDENT AUDITORS
- ------------------------------------------------------------------------------
To the Shareholders of
Strawbridge & Clothier
We have audited the accompanying consolidated balance sheets of Strawbridge
& Clothier as of January 29, 1994 and January 30, 1993, and the related
consolidated statements of operations, common shareholders' equity, and
cash flows for each of the three fiscal years in the period ended January
29, 1994. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of
Strawbridge & Clothier at January 29, 1994 and January 30, 1993, and the
consolidated results of its operations and its cash flows for each of the
three fiscal years in the period ended January 29, 1994, in conformity with
generally accepted accounting principles.
As discussed in Notes 2, 4, and 7 to the financial statements, in 1992 the
Company changed its method of determining retail price indices used in the
valuation of LIFO inventories, and changed its methods of accounting for
postretirement benefits other than pensions and for income taxes.
Philadelphia, Pennsylvania
March 23, 1994 ERNST & YOUNG
13
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
- ------------------------------------------------------------------------------
OPERATIONS
Sales for fiscal 1993 were $984,615,000, an increase of 1.7% over sales
of $967,794,000 in fiscal 1992, which were virtually even with sales in
fiscal 1991. The 1993 sales result reflects a strong Christmas selling
season, offset by poor weather conditions in the Company's trading area
during much of the first quarter of fiscal 1993 and January 1994. Sales
for all three years were affected by an economic slowdown in the northeast
section of the country. Early fiscal 1994 sales results have also been
adversely impacted by severe weather conditions, but there are indications
that consumer buying patterns in the Company's trading area could improve
as fiscal 1994 progresses.
Earnings for fiscal year 1993 were $17,727,000, a decrease of 1.6% from
1992 earnings of $18,020,000 before accounting changes. Earnings for 1991
were $13,568,000. The slight decline in fiscal 1993 can be attributed to
increased markdowns taken to stimulate sales, a reduced LIFO benefit and
increased advertising expenses. These items were partially offset by
decreases in bad debt write-offs and interest expense. The improvement in
1992 earnings before accounting changes reflected higher finance charge
income, lower interest expense and a change in the Company's method of
accounting for LIFO inventories, which is discussed below. In 1992, the
Company early-adopted two significant new accounting rules, in both cases
following the cumulative effect approach. The Company changed to the
accrual method of accounting for retiree health care benefits, as required
by FASB Statement No. 106, "Employers' Accounting for Postretirement
Benefits Other Than Pensions," which resulted in a one-time, noncash charge
against earnings upon adoption of $26,600,000, after taxes, or $2.60 per
share and an additional expense in 1992 of $860,000 after taxes, or $.08
per share. The Company also adopted the liability method of accounting for
income taxes which resulted in an increase to net earnings of $9,750,000,
or $.95 per share. (See Notes 4 and 7 to the accompanying financial
statements regarding these changes.)
Cost of sales, including occupancy and buying costs, was 74.5% of sales
in 1993, compared to 74.2% in 1992 and 74.3% in 1991. Cost of sales for
1993 and 1992 was negatively impacted by increased markdowns taken to
stimulate sales and respond to competitive pressures in a difficult
economic climate. This negative impact was partially offset in 1993 by a
reduction in occupancy and buying costs. The impact of the LIFO method of
accounting for inventories (benefits of $1,239,000 and $2,380,000 in 1993
and 1992 and a charge of $3,325,000 in 1991) is reflected in cost of sales.
In 1992, the Company changed to the use of internal price indices for
purposes of determining certain LIFO inventories. The Company believes the
internal indices more accurately measure inflation in its inventories than
the government indices previously used. This change reduced 1992 cost of
sales by $3,948,000 compared to the prior method. (See Note 2 to the
accompanying financial statements regarding this change.)
Selling and administrative expenses, net of finance charges, were 17.5%
of sales in 1993, compared to 17.2% of sales in 1992 and 17.6% of sales in
1991. The 1993 increase reflects a planned increase in advertising
expenses to stimulate sales and tight control of other operating expenses.
Both 1993 and 1992 reflect increased finance charge income in relation to
1991, which resulted from reduced minimum payment requirements on the
Company's flexible charge accounts.
Depreciation expense as a percentage of sales was comparable for all
three years, at 2.9% of sales in 1993 and 1992 and 3.0% of sales in 1991.
Interest expense was 2.1% of sales in 1993 compared with 2.2% in 1992 and
2.4% in 1991. Interest expense has declined due to a combination of
refinancing high-rate long-term debt and lower interest rates on short-term
borrowings. Short-term borrowing rates are expected to increase in 1994.
The 1993 provision for doubtful accounts decreased $1,914,000 compared to
1992, which had decreased from 1991 by $694,000. This result reflects
decreased write-offs of accounts receivable as a result of improved aging
due in part to a change in payment policy. The increase in the effective
tax rate to 33.9% in 1993 from 33.7% in 1992 resulted from the increase in
the statutory federal income tax rate from 34.0% to 35.0%, partially offset
by increased jobs tax credits.
14
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS (CONTINUED)
- ------------------------------------------------------------------------------
FINANCIAL CONDITION AND LIQUIDITY
Cash provided by operating activities for 1993 was $31.7 million
compared to $28.2 million in 1992 and $43.9 million in 1991. The slight
increase in 1993 was a result of careful control of inventory levels,
partially offset by reduced collections of accounts receivable as a result
of lower, more competitive, minimum payment requirements on the Company's
charge accounts. Cash provided by operating activities in 1992 decreased
from 1991 due to increased inventory purchases and reduced accounts
receivable collections.
The Company's capital expenditures were $22.1 million, $22.6 million
and $16.4 million in fiscal 1993, 1992 and 1991, respectively. Capital
expenditures for 1993 included the renovation of the women's apparel area
of the Philadelphia store, the total renovation of the Marlton and
Blackwood Clover stores and other smaller renovation projects.
Cash used for financing activities was $11.2 million, $3.4 million and
$29.3 million in fiscal 1993, 1992 and 1991, respectively. In October
1993, the Company completed a public offering of $50,000,000 of 6.625%
Notes due 2003. The net proceeds of $49,255,000 were used, together with
other short-term borrowings, to redeem $50,000,000 of the Company's 8.75%
Notes due 1996 at a price equal to their principal amount plus interest
accrued to the redemption date. This refinancing will result in annual
interest expense savings in excess of $1.0 million.
The Company has $30.0 million in confirmed bank credit lines. At
January 29, 1994, $22.0 million of these confirmed lines were in use, in
addition to $21.5 million of unconfirmed lines. Long-term debt and capital
lease obligations were 44.9% of capitalization at the end of fiscal 1993,
compared to 47.9% at the end of the prior fiscal year.
Anticipated capital expenditures for 1994 of $26.2 million include the
renovation of the Mercerville and Cheltenham Clover stores and the
renovation of the fourth floor of the Philadelphia department store. An
additional $24.6 million is planned for capital expenditures in 1995, which
includes the opening of one Clover store and the renovation of three Clover
stores. The funding for these capital expenditures is expected to be
generated from operations and additional long-term financing. The Company
continually investigates potential sites for new stores, and capital
expenditure plans may change as opportunities for new stores develop.
The Company believes its relations with banks and other credit sources
are good and that it has considerable flexibility in deciding how to fund
future capital expenditures and maturities of long-term debt.
- ------------------------------------------------------------------------------
ANNUAL MEETING
The Annual Meeting of shareholders will be held on Wednesday, May 25, 1994,
at 11:00 AM in the auditorium on the eighth floor of the Company's
Main Store at 801 Market Street, Philadelphia, PA. All shareholders are
cordially invited to attend.
Corporate Headquarters
801 Market Street
Philadelphia, PA 19107-3199
Phone (215) 629-6000
Independent Auditors
Ernst & Young
General Counsel
Morgan, Lewis & Bockius
TRANSFER AGENTS
Shareholder inquiries for the Common Stock and the Preferred Stock
should be directed to:
Mellon Bank, N.A.
P.O. Box 444
Pittsburgh, PA 15230
Phone 1-800-526-0801
15
<PAGE>
TEN-YEAR FINANCIAL SUMMARY
(amounts in thousands, except per share data)
<TABLE>
<CAPTION>
1993 1992 1991 1990 1989(1) 1988 1987 1986 1985 1984(1)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
OPERATING RESULTS
Net Sales ......... $984,615 $967,794 $967,786 $981,668 $950,306 $904,196 $814,313 $739,117 $686,929 $630,497
- ----------------------------------------------------------------------------------------------------------------------
Cost of Sales ..... 733,901 718,582 718,927 730,048 687,713 660,412 592,309 536,932 494,936 452,954
- ----------------------------------------------------------------------------------------------------------------------
Interest Expense .. 20,909 21,446 23,048 25,481 25,386 22,112 17,694 17,066 18,258 15,114
- ----------------------------------------------------------------------------------------------------------------------
Earnings Before
Income Taxes and
Cumulative Effect
of Accounting
Changes .......... 26,829 27,189 20,714 28,606 51,726 45,026 48,739 41,734 46,755 49,286
- ----------------------------------------------------------------------------------------------------------------------
Income Taxes ...... 9,102 9,169 7,146 11,385 20,567 17,756 21,725 21,042 22,669 24,611
- ----------------------------------------------------------------------------------------------------------------------
Earnings Before
Cumulative Effect
of Accounting
Changes .......... 17,727 18,020 13,568 17,221 31,159 27,270 27,014 20,692 24,086 24,675
- ----------------------------------------------------------------------------------------------------------------------
Net Earnings ...... 17,727 1,170(3) 13,568 17,221 31,159 27,270 27,014 20,692 24,086 24,675
OTHER OPERATING DATA
Depreciation ...... $ 28,829 $ 28,322 $ 28,710 $ 27,910 $ 24,565 $ 21,904 $ 18,812 $ 16,911 $ 14,815 $ 13,396
- ----------------------------------------------------------------------------------------------------------------------
Rent .............. 6,318 7,419 6,320 4,475 4,088 4,229 3,704 3,183 2,596 2,254
- ----------------------------------------------------------------------------------------------------------------------
Taxes Other Than
Income Taxes ..... 25,050 25,164 25,627 25,020 23,777 21,965 20,581 18,896 17,691 16,818
- ----------------------------------------------------------------------------------------------------------------------
Cash Dividends:
Preferred Stock .. 17 26 35 43 53 62 69 70 72 77
- ----------------------------------------------------------------------------------------------------------------------
Common Stock ..... 10,963 10,502 10,067 9,540 8,837 8,178 6,365 5,631 4,662 4,106
- ----------------------------------------------------------------------------------------------------------------------
Stock Dividends on
Common Stock 3% 3% 3% 7% 7% 7% 7% 7% 7% 7%
PER SHARE OF
COMMON STOCK(2)
Earnings Before
Cumulative Effect
of Accounting
Changes .......... $ 1.71 $ 1.76 $ 1.34 $ 1.72 $ 3.13 $ 2.77 $ 2.76 $ 2.12 $ 2.52 $ 2.17
- ----------------------------------------------------------------------------------------------------------------------
Net Earnings ...... 1.71 .11(3) 1.34 1.72 3.13 2.77 2.76 2.12 2.52 2.17
- ----------------------------------------------------------------------------------------------------------------------
Cash Dividends on
Series A Common
Stock ............ 1.08 1.07 1.03 .99 .92 .84 .68 .33 -- --
- ----------------------------------------------------------------------------------------------------------------------
Cash Dividends on
Series B Common
Stock ............ .99 .96 .92 .90 .85 .79 .60 .29 -- --
- ----------------------------------------------------------------------------------------------------------------------
Cash Dividends on
Common Stock ..... -- -- -- -- -- -- -- .27 .49 .36
- ----------------------------------------------------------------------------------------------------------------------
Book Value ........ 24.28 23.68 24.66 24.40 23.69 21.43 19.50 17.39 15.79 13.75
FINANCIAL DATA
Working Capital ... $209,581 $212,514 $184,641 $171,504 $188,411 $178,906 $186,028 $165,418 $148,973 $126,201
- ----------------------------------------------------------------------------------------------------------------------
Property, Fixtures
& Equipment --
Net .............. 300,368 307,158 312,876 322,059 301,228 279,337 233,508 197,801 188,468 184,922
- ----------------------------------------------------------------------------------------------------------------------
Total Assets ...... 663,052 653,939 631,987 645,603 618,546 593,278 518,289 472,639 454,811 430,633
- ----------------------------------------------------------------------------------------------------------------------
Long-Term Debt .... 162,254 171,617 156,237 158,880 167,188 154,267 128,685 115,271 105,790 101,032
- ----------------------------------------------------------------------------------------------------------------------
Capital Lease
Obligations ...... 43,554 52,030 55,481 59,370 59,179 63,773 63,351 58,780 61,565 65,551
- ----------------------------------------------------------------------------------------------------------------------
Redeemable
Preferred Stock .. 296 474 655 814 1,022 1,199 1,384 1,384 1,431 1,444
- ----------------------------------------------------------------------------------------------------------------------
Common Shareholders'
Equity ........... 252,202 242,839 250,548 244,153 234,777 210,761 190,050 167,922 151,504 130,982
- ----------------------------------------------------------------------------------------------------------------------
Number of
Common Shares
Outstanding ...... 10,386 9,957 9,579 9,157 8,478 7,860 7,281 6,744 6,259 3,873
- ----------------------------------------------------------------------------------------------------------------------
Square Feet of
Store Space 5,744 5,744 5,744 5,674 5,591 5,487 5,088 5,088 5,007 4,922
</TABLE>
(1) 53-week fiscal year
(2) Weighted average shares outstanding were: 1993 -- 10,324; 1992 --
10,216; 1991 -- 10,099; 1990 -- 9,988; 1989 -- 9,965; 1988 -- 9,835;
1987 -- 9,780; 1986 -- 9,744; 1985 -- 9,569; 1984 -- 11,387. Net earnings
give effect to dividend requirements of the preferred stock.
(3) Includes cumulative effect adjustments relating to accounting changes
for income taxes ($9,750 benefit; $.95 per share) and retiree health
care benefits ($26,600 charge; $2.60 per share) and reduced cost of
sales of $3,948 as a result of a change in LIFO accounting method,
resulting in an after-tax benefit of $2,606 or $.26 per share.
16 17
<PAGE>
<TABLE>
QUARTERLY RESULTS
OF OPERATIONS
(in thousands, except per share data)
- -------------------------------------------------------------------------------------------------
<CAPTION>
FIRST SECOND THIRD FOURTH
1993 1992 1993 1992 1993 1992 1993 1992
---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net sales ........ $197,151 $205,608 $225,018 $214,425 $223,639 $215,737 $338,807 $332,024
Gross profit ..... 44,414 50,430 51,384 49,207 56,698 53,892 98,218 95,683
Earnings (loss)
before cumulative
effect of
accounting
changes ......... (4,255) (1,144) (1,425) (1,792) 69 (1,332) 23,338 22,288
Net earnings
(loss)(1)(2) .... (4,255) (17,994) (1,425) (1,792) 69 (1,332) 23,338 22,288
Earnings (loss)
per common share:
Before cumulative
effect of
acounting
changes ......... (.41) (.11) (.14) (.17) .01 (.13) 2.25 2.17
Net earnings
(loss)(1)(2) .... (.41) (1.76) (.14) (.17) .01 (.13) 2.25 2.17
</TABLE>
(1) First quarter 1992 results reflect the cumulative effect of a change in
accounting for retiree medical benefits of ($26,600) or ($2.60) per
share and the $9,750 or $.95 per share cumulative effect of a change in
accounting for income taxes.
(2) Provision for the LIFO method of accounting for inventories and cost of
sales had the effect of increasing earnings per common share by $.20
and $.28 for the 1993 and 1992 fourth quarters, respectively.
MARKET AND DIVIDEND
INFORMATION
- ------------------------------------------------------------------------------
The Company's Series A Common Stock is traded on the over-the-counter
market. There is no trading market for Series B Common Stock but it is
readily convertible at any time into Series A Common Stock on a
share-for-share basis. The number of shareholders of record as of January
3, 1994 was 5,668 for Series A and 253 for Series B. The following table
indicates quarterly cash dividends per common share and the range of high
and low price quotations for the Series A Common Stock by quarter during
the last two fiscal years, as obtained through NASDAQ.
FIRST SECOND THIRD FOURTH
1993 1992 1993 1992 1993 1992 1993 1992
---- ---- ---- ---- ---- ---- ---- ----
Cash dividends
per common
share:
Series A .. $ .27 $ .26 $ .27 $ .27 $ .27 $ .27 $ .27 $ .27
Series B .. .24 .24 .25 .24 .25 .24 .25 .24
Common stock
price range:
High ..... 25.50 26.75 24.75 25.75 21.75 22.50 23.50 25.50
Low ...... 23.25 22.50 21.00 20.00 19.25 18.75 20.75 21.50
18
