10-Q 1 0001.txt QUARTERLY REPORT SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2000 Commission File Number 1-12381 Linens 'n Things, Inc. (Exact name of Registrant as specified in its charter) Delaware 22-3463939 -------- ---------- (State or other jurisdiction of (I.R.S. Employer Identification Number) incorporation or organization) 6 Brighton Road, Clifton, New Jersey 07015 ------------------------------------ ----- (Address of principal executive offices) (Zip Code) (973) 778-1300 -------------- (Registrant's telephone number, including area code) Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ----- ----- Number of shares outstanding of the issuer's Common Stock: Class Outstanding at November 6, 2000 ----- ------------------------------- Common Stock, $0.01 par value 40,005,834
INDEX Part I. Financial Information Page No. -------- Item 1. Financial Statements Consolidated Statements of Operations for the Thirteen and Thirty-Nine Weeks Ended September 30, 2000 (Unaudited) and October 2, 1999 (Unaudited) 3 Consolidated Balance Sheets as of September 30, 2000 (Unaudited), January 1, 2000 and October 2, 1999 (Unaudited) 4 Consolidated Statements of Cash Flows for the Thirty-Nine Weeks Ended September 30, 2000 (Unaudited) and October 2, 1999 (Unaudited) 5 Notes to Consolidated Financial Statements 6-7 Independent Auditors' Review Report 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 9-12 Item 3. Quantitative and Qualitative Disclosures about Market Risk 12 Part II. Other Information Item 1. Legal Proceedings 13 Item 6. Exhibits and Reports on Form 8-K 13 (a) Exhibit Index 13 (b) Reports on Form 8-K 13
PART I - FINANCIAL INFORMATION Item 1. Financial Statements
LINENS 'N THINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) (Unaudited) Thirteen Weeks Ended Thirty-Nine Weeks Ended ---------------------------------- -------------------------------- September 30, October 2, September 30, October 2, 2000 1999 2000 1999 --------------- ------------- ---------------- ------------- Net sales $ 410,371 $341,122 $1,077,002 $886,290 Cost of sales, including buying and warehousing costs 244,285 203,886 642,932 531,467 --------------- ------------- ---------------- ------------- Gross profit 166,086 137,236 434,070 354,823 Selling, general and administrative expenses 135,576 113,361 383,546 316,858 --------------- ------------- ---------------- ------------- Operating profit 30,510 23,875 50,524 37,965 Interest expense (income), net 663 34 1,223 (21) --------------- ------------- ---------------- ------------- Income before provision for income taxes 29,847 23,841 49,301 37,986 Provision for income taxes 11,441 9,179 18,893 14,626 --------------- ------------- ---------------- ------------- Net income $ 18,406 $ 14,662 $ 30,408 $ 23,360 =============== ============= ================ ============= Per share of common stock: Basic Net income per share $0.46 $0.37 $0.77 $0.59 Weighted average shares outstanding 39,965 39,395 39,706 39,305 Diluted Net income per share $0.45 $0.36 $0.75 $0.57 Weighted average shares outstanding 40,811 40,940 40,616 40,959
See accompanying notes to consolidated financial statements.
LINENS 'N THINGS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands, except share amounts) September 30, January 1, October 2, 2000 2000 1999 ------------------ ------------------ ----------------- (Unaudited) (Unaudited) Assets Current assets: Cash and cash equivalents $ 6,039 $ 45,751 $ 18,408 Accounts receivable, net 26,489 20,836 20,877 Inventories 475,224 342,681 369,255 Prepaid expenses and other current assets 23,816 21,410 21,009 ------------------ ------------------ ----------------- Total current assets 531,568 430,678 429,549 Property and equipment, net 260,990 223,725 215,787 Goodwill, net 19,189 19,826 20,039 Deferred charges and other noncurrent assets, net 6,898 5,687 5,353 ------------------ ------------------ ----------------- Total assets $ 818,645 $ 679,916 $ 670,728 ================== ================== ================= Liabilities and Shareholders' Equity Current liabilities: Accounts payable $ 216,987 $ 144,884 $ 180,898 Accrued expenses and other current liabilities 109,800 104,414 95,006 Short-term borrowings 15,100 -- -- ------------------ ------------------ ----------------- Total current liabilities 341,887 249,298 275,904 Deferred income taxes and other long-term liabilities 54,518 46,656 41,691 Shareholders' equity: Preferred stock, $0.01 par value; 1,000,000 shares authorized; none issued and outstanding -- -- -- Common stock, $0.01 par value; 135,000,000 shares authorized at September 30, 2000, January 1, 2000 and October 2, 1999; 40,074,906 shares issued and 39,968,429 outstanding at September 30, 2000; 39,555,259 shares issued and 39,478,782 outstanding at January 1, 2000; 39,473,234 shares issued and 39,396,757 outstanding at October 2, 1999 401 396 395 Additional paid-in capital 229,738 220,751 218,615 Retained earnings 195,657 165,249 136,557 Accumulated other comprehensive income (308) -- -- Treasury stock, at cost, 106,477 shares at September 30, 2000; 76,477 shares at January 1, 2000 and October 2, 1999 (3,248) (2,434) (2,434) ------------------ ------------------ ----------------- Total shareholders' equity 422,240 383,962 353,133 ------------------ ------------------ ----------------- Total liabilities and shareholders' equity $ 818,645 $ 679,916 $670,728 ================== ================== ================= See accompanying notes to consolidated financial statements
LINENS 'N THINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) Thirty-Nine Weeks Ended ----------------------------------------- September 30, October 2, 2000 1999 ------------------- ------------------ (Unaudited) Cash flows from operating activities: Net income $ 30,408 $ 23,360 Adjustments to reconcile net income to net cash (used in) provided by operating activities: Depreciation and amortization 23,816 19,851 Deferred income taxes 2,507 1,784 Loss on disposal of assets 791 553 Federal tax benefit from common stock exercised under stock incentive plans 2,776 4,106 Changes in assets and liabilities: (Increase) decrease in accounts receivable (5,653) 1,937 Increase in inventories (132,543) (97,866) Decrease (increase) in prepaid expenses and other current assets 58 (1,640) Increase in deferred charges (1,654) (569) Increase in accounts payable 58,871 61,941 Increase (decrease) in accrued expenses and other liabilities 18,333 (8,841) ------------------- ------------------ Net cash (used in) provided by operating activities (2,290) 4,616 ------------------- ------------------ Cash flows from investing activities: Additions to property and equipment (60,791) (55,055) ------------------- ------------------ Cash flows from financing activities: Proceeds from common stock exercised under stock incentive plans 6,216 3,135 Purchase of treasury stock (814) (1,044) Increase in book overdrafts 2,867 24,118 Increase in short-term borrowings 15,100 -- ------------------- ----------------- Net cash provided by financing activities 23,369 26,209 ------------------- ----------------- Net decrease in cash and cash equivalents (39,712) (24,230) Cash and cash equivalents at beginning of year 45,751 42,638 ------------------- ----------------- Cash and cash equivalents at end of period $ 6,039 $ 18,408 =================== =================
See accompanying notes to consolidated financial statements. LINENS 'N THINGS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. Basis of Presentation The accompanying consolidated financial statements, except for the January 1, 2000 consolidated balance sheet, are unaudited. In the opinion of management, the accompanying consolidated financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the financial position of the Company as of September 30, 2000 and the results of operations for the respective thirteen and thirty-nine weeks then ended and cash flows for the thirty-nine weeks then ended. Because of the seasonality of the specialty retailing business, operating results of the Company on a quarterly basis may not be indicative of operating results for the full year. These consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements for the year ended January 1, 2000, included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission. All significant intercompany accounts and transactions have been eliminated. The January 1, 2000 consolidated balance sheet amounts have been derived from the Company's audited consolidated balance sheet amounts. 2. Short-Term Borrowing Arrangements The Company has available a three-year, $90 million senior revolving credit facility agreement (the "Credit Agreement") with third party institutional lenders which was due to expire March 31, 2001. The amount of borrowings under that Credit Agreement could be increased up to $125 million provided certain terms and conditions contained in the Credit Agreement were met. The Credit Agreement contained certain financial covenants, including those relating to the maintenance of a minimum tangible net worth, a minimum fixed charge coverage ratio, and a maximum leverage ratio, as defined in the Credit Agreement. As of September 30, 2000, the Company was in compliance with the terms and conditions of the Credit Agreement. The Credit Agreement also allowed for up to $25 million in borrowings from uncommitted lines of credit outside of the Credit Agreement. As of September 30, 2000, the Company had no borrowings under the Credit Agreement and had $15.1 million in borrowings against the uncommitted lines of credit. See Note 5, "Subsequent Event", as to the $140 million replacement credit facility entered into by the Company on October 20, 2000. 3. Recent Accounting Pronouncements The Company is required to adopt Statement of Financial Standards ("SFAS") No. 133 "Accounting for Derivative Instruments and Hedging Activities" ("SFAS No. 133"). This statement is effective for fiscal years beginning after June 15, 1999. The Company has determined that the implementation of SFAS No. 133 is not expected to have a significant effect on its results of operations or financial position. This statement is not required to be applied retroactively to financial statements of prior periods. Financial Accounting Standards Board ("FASB") Interpretation No. 44, "Accounting for Certain Transactions Involving Stock Compensation" ("FIN No. 44") provides guidance for applying Accounting Pronouncements Board ("APB") Opinion No. 25, "Accounting for Stock Issued to Employees". With certain exceptions, FIN No. 44 applies prospectively to new awards, exchanges of awards in a business combination, modifications to outstanding awards and changes in grantee status on or after July 1, 2000. The Company has determined that the implementation of FIN No. 44 is not expected to have a significant effect on its results of operations or financial position. At a recent FASB Emerging Issues Task Force ("EITF") meeting, a consensus was reached with respect to the issue of "Accounting for Certain Sales Incentives," including point of sale coupons, rebates and free merchandise. The consensus included a conclusion that the value of such sales incentives that result in a reduction of the price paid by the customer should be netted against sales and not classified as a sales or marketing expense. The adoption of the EITF is required in the fourth quarter of the Company's current year. The Company already includes such sales incentives against sales and records free merchandise in cost of goods sold as required by the new EITF consensus. 4. Comprehensive Income Statement of Financial Accounting Standards ("SFAS") No. 130, "Reporting Comprehensive Income" ("SFAS No. 130"), requires that items defined as other comprehensive income, such as foreign currency translation adjustments, be separately classified in the financial statements and that the accumulated balance of other comprehensive income be reported separately from retained earnings and additional paid-in capital in the equity section of the balance sheet. The components of comprehensive income for the thirteen and thirty-nine week periods ended September 30, 2000 are as follows:
Thirteen Weeks Ended Thirty-nine Weeks Ended September 30, 2000 September 30, 2000 ----------------------- ----------------------------- Comprehensive Income: Net Income $ 18,406 $ 30,408 Other comprehensive income -- Foreign currency translation adjustment (142) (308) ------------------------ ----------------------------- Comprehensive income $ 18,264 $ 30,100 ======================== =============================
5. Subsequent Event On October 20, 2000, the Company entered into a $140 million Credit Agreement with Fleet Bank and the lenders party thereto (the "Agreement"). The Agreement replaces the Credit Agreement dated as of March 31, 1998 by and among the Company, each subsidiary party thereto, the lenders party thereto and The Bank of New York. The terms of the new Credit Agreement include, among other things, an option to increase the size of the facility to $150 million if certain conditions are met. The Agreement also allows for up to $40 million in borrowings from uncommitted lines of credit. Independent Auditors' Review Report The Board of Directors and Shareholders Linens 'n Things, Inc.: We have reviewed the consolidated balance sheets of Linens 'n Things, Inc. and subsidiaries as of September 30, 2000 and October 2, 1999, and the related consolidated statements of operations for the thirteen and thirty-nine week periods then ended and the related consolidated statements of cash flows for the thirty-nine week periods ended September 30, 2000 and October 2, 1999. These consolidated financial statements are the responsibility of the Company's management. We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical review procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to the consolidated financial statements referred to above for them to be in conformity with generally accepted accounting principles. We have previously audited, in accordance with generally accepted auditing standards, the consolidated balance sheet of Linens 'n Things, Inc. and subsidiaries as of January 1, 2000 and the related consolidated statements of operations, shareholders' equity, and cash flows for the year then ended (not presented herein); and in our report dated February 2, 2000 we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of January 1, 2000, is fairly presented, in all material respects, in relation to the consolidated balance sheet from which it has been derived. KPMG LLP New York, New York October 18, 2000, except as to Notes 2 and 5 which are as of October 20, 2000 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations LINENS 'N THINGS, INC. AND SUBSIDIARIES MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis should be read in conjunction with the consolidated financial statements of the Company and the notes thereto appearing elsewhere in this document. Results of Operations Thirteen Weeks Ended September 30, 2000 Compared with Thirteen Weeks Ended October 2, 1999 Net sales increased 20.3% to $410.4 million for the thirteen weeks ended September 30, 2000, up from $341.1 million for the same period in 1999, primarily as a result of new store openings since October 2, 1999. Net sales were also driven by a healthy mix of core businesses, a positive response to new fashions in the Company's textile business and growth of the Company's new product offerings in the "things" business. The Company continues to increase its penetration of the "things" business, which represents approximately 40% of total net sales. Comparable store net sales for the thirteen weeks ended September 30, 2000 increased 4.0% as compared with an increase of 5.2% for the same period last year. During the thirteen weeks ended September 30, 2000, the Company opened 23 stores and closed no stores, compared with opening 15 stores and closing two stores during the same period last year. At September 30, 2000, the Company operated 267 stores, compared with 217 stores, at October 2, 1999. Store square footage increased 24.6% to 9,255,000 at September 30, 2000 compared with 7,425,000 at October 2, 1999. Gross profit for the thirteen weeks ended September 30, 2000 was $166.1 million, or 40.5% of net sales, compared with $137.2 million, or 40.2% of net sales, for the same period last year. The increase in gross profit was due primarily to improved mark-on as a result of overall selling mix, increased penetration of seasonal products and improved buying. In addition, logistics costs as a percentage of net sales were lower than last year as the Company continues to leverage these costs through its distribution network. Furthermore, as the Company's logistics network continues to mature, the Company recognizes such benefits as lower freight costs, improved store operational efficiencies and improvements in pipeline management. Selling, general and administrative expenses for the thirteen weeks ended September 30, 2000 were $135.6 million, or 33.0% of net sales, compared with $113.4 million, or 33.2% of net sales, for the same period last year. Although the Company opened 23 stores this quarter versus 15 stores for the same quarter last year, the pre-opening costs associated with these eight additional stores was more than offset by the leveraging of occupancy costs, promotional expenditures and administrative expenses. Operating profit for the thirteen weeks ended September 30, 2000 increased to $30.5 million, or 7.4% of net sales, compared with $23.9 million, or 7.0% of net sales, for the same period last year. The Company incurred net interest expense of approximately $663,000 (including the amortization of commitment fees in connection with the Company's $90 million credit agreement) for the thirteen weeks ended September 30, 2000, compared with approximately $34,000 for the same period in 1999. The higher interest expense is predominately due to increased average borrowings as compared to the same period last year and increased average interest rates. The Company's income tax expense for the thirteen weeks ended September 30, 2000 was approximately $11.4 million as compared with $9.2 million for the same period last year. The Company's effective tax rate was 38.3% for the thirteen weeks ending September 30, 2000 as compared with 38.5% for the same period in 1999. The decrease in tax rate is primarily attributable to an increase in earnings before taxes while book to tax permanent differences remained constant. LINENS 'N THINGS, INC. AND SUBSIDIARIES MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS As a result of the factors described above, net income for the thirteen weeks ended September 30, 2000 increased to $18.4 million, or $0.45 per share, compared with $14.7 million, or $0.36 per share, for the same period last year. Thirty-Nine Weeks Ended September 30, 2000 Compared with Thirty-Nine Weeks Ended October 2, 1999 Net sales increased 21.5% to $1,077.0 million for the thirty-nine weeks ended September 30, 2000, up from $886.3 million for the same period in 1999, primarily as a result of new store openings since October 2, 1999. Comparable store net sales for the thirty-nine weeks ended September 30, 2000 increased 4.3% as compared with an increase of 5.7% for the same period last year. The Company continues to increase its penetration of the "things" business, which represents approximately 40% of total net sales. During the thirty-nine weeks ended September 30, 2000, the Company opened 40 stores and closed 3 stores, compared with opening 29 stores and closing 8 stores during the same period last year. Gross profit for the thirty-nine weeks ended September 30, 2000 was $434.1 million, or 40.3% of net sales, compared with $354.8 million, or 40.0% of net sales, for the same period last year. The increase in gross profit was due primarily to improvements in selling mix, which included an increased penetration of higher margin seasonal merchandise, improved buying and the leveraging of logistics costs through the use of the Company's distribution network. Selling, general and administrative expenses for the thirty-nine weeks ended September 30, 2000 were $383.5 million, or 35.6% of net sales, compared with $316.9 million, or 35.8% of net sales, for the same period last year. This decrease as a percentage of net sales is primarily due to the leveraging of occupancy costs and administrative expenses, offset in part by continued investment in store payroll in order to improve guest service levels. Operating profit for the thirty-nine weeks ended September 30, 2000 increased to $50.5 million, or 4.7% of net sales, compared with $38.0 million, or 4.3% of net sales, for the same period last year. The Company had net interest expense of approximately $1.2 million (including the amortization of commitment fees in connection with the Company's $90 million credit agreement) for the thirty-nine weeks ended September 30, 2000, compared with approximately $21,000 of net interest income for the same period in 1999. The higher interest expense is predominately due to increased average borrowings and higher average interest rates. The Company's income tax expense for the thirty-nine weeks ended September 30, 2000 was $18.9 million as compared with $14.6 million for the same period last year. The Company's effective tax rate was 38.3% for the thirty-nine weeks ending September 30, 2000 compared to 38.5% for the same period last year. The decrease in tax rate is primarily attributable to an increase in earnings before taxes while book to tax permanent differences remained constant. As a result of the factors described above, net income for the thirty-nine weeks ended September 30, 2000 increased to $30.4 million, or $0.75 per share, compared with $23.4 million, or $0.57 per share, for the same period last year. Liquidity and Capital Resources The Company's capital requirements are primarily investments in new stores, new store inventory purchases and seasonal working capital. These requirements are funded through a combination of internally generated cash from operations, credit extended by suppliers and short-term borrowings. On October 20, 2000, the Company entered into a $140 million Credit Agreement with Fleet Bank and the lenders party thereto (the "Agreement"). The Agreement replaces the Credit Agreement dated as of March 31, 1998 by and among the Company, each subsidiary party thereto, the lenders party thereto and The Bank of New York. The terms of the Agreement include, among other things, an option to increase the size of the facility to $150 million if certain conditions are met. The Agreement also allows for up to $40 million in borrowings from uncommitted lines of credit. Net cash used in operating activities for the thirty-nine weeks ended September 30, 2000 was $2.3 million compared with net cash provided by operating activities of $4.6 million for the same period last year. The net cash used in operating activities was primarily attributable to an increase in inventory as a result of an increase in the number of new store openings since October 2, 1999, offset in part by an increase in accrued expenses due to the timing and settlement of vendor payments. Net cash used in investing activities during the thirty-nine weeks ended September 30, 2000 was $60.8 million compared with $55.1 million for the same period last year. The increase is associated with the opening of 11 more stores this year versus the same period last year, which was offset by capital expenditures incurred through the third quarter of 1999 for the second distribution center. Net cash provided by financing activities during the thirty-nine weeks ended September 30, 2000 was $23.4 million compared with $26.2 million for the same period last year. Net cash provided by financing activities during the thirty-nine weeks ended September 30, 2000 was primarily the result of an increase in short-term borrowings of $15.1 million. Management currently believes that the Company's cash flows from operations, credit extended by suppliers, the revolving credit facility and the uncommitted lines of credit will be sufficient to fund anticipated capital expenditures and working capital requirements in the foreseeable future. LINENS `N THINGS, INC. AND SUBSIDIARIES MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Inflation The Company does not believe that its operating results have been materially affected by inflation during the preceding three years. There can be no assurance, however, that the Company's operating results will not be affected by inflation in the future. Seasonality The Company's business is subject to substantial seasonal variations. Historically, the Company has realized a significant portion of its net sales and net income for the year during the third and fourth quarters. The Company's quarterly results of operations may also fluctuate significantly as a result of a variety of other factors, including the timing of new store openings. The Company believes this is the general pattern associated with its segment of the retail industry and expects this pattern will continue in the future. Consequently, comparisons between quarters are not necessarily meaningful and the results for any quarter are not necessarily indicative of future results. Forward-Looking Statements The foregoing contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. The statements were made a number of times and have been identified by such forward-looking terminology as "expect," "believe," "may," "will," "intend," "plan," "target" and similar statements or variations of such terms. Such forward-looking statements are based on our current expectations, assumptions, estimates and projections about our Company and involve certain significant risks and uncertainties including levels of sales, store traffic, acceptance of product offerings and fashions, the success of our new business concepts and seasonal concepts, competitive pressures from other home furnishings retailers, the success of the Canadian expansion, availability of suitable future store locations and schedule of store expansion. These and other important factors that may cause actual results to differ materially from such forward-looking statements are included in the "Risk Factors" section of the Company's Registration Statement on Form S-1 as filed with the Securities and Exchange Commission on May 29, 1997, and may be contained in subsequent reports filed with the Securities and Exchange Commission. You are urged to consider all such factors. In light of the uncertainty inherent in such forward-looking statements, you should not consider their inclusion to be a representation that such forward-looking matters will be achieved. The Company assumes no obligation for updating any such forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting such forward-looking statements. Item 3. Quantitative and Qualitative Disclosures about Market Risk. In the normal course of operations, the Company is exposed to market risk arising from adverse changes in interest rates. The Company is exposed to interest rate risks primarily through borrowings under the Credit Agreement. The Company does not hedge these interest rate risks. As of September 30, 2000, the Company had no borrowings under the Credit Agreement and had $15.1 million in borrowings against the uncommitted lines of credit at a variable rate. PART II - OTHER INFORMATION Item 1. Legal Proceedings The Company is a defendant in a California state court litigation brought as a class action on behalf of certain managers of Company stores located in California seeking overtime pay as well as a claim for accrued vacation pay on behalf of certain former employees. In the event such claims for overtime pay and/or vaction pay are determined adversely to the Company, management of the Company does not believe such claims, if so adversely determined, would have a material adverse effect on the Company's financial position, liquidity or results of operations. Item 6. Exhibits and Reports on Form 8-K (a) EXHIBIT INDEX Exhibit Number Description ------ ----------- 11 Computation of Net Income Per Common Share 15 Letter re unaudited interim financial information 27 Financial Data Schedule (filed electronically with SEC only) (b) Reports on Form 8-K: There were no current reports on Form 8-K filed with the Securities and Exchange Commission during the third quarter of 2000. SIGNATURE 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. LINENS 'N THINGS, INC. (Registrant) WILLIAM T. GILES By: ---------------------------------- William T. Giles Senior Vice President, Chief Financial Officer (Duly authorized officer and principal financial officer) Date: November 14, 2000