-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Tce6UqTShreDd2c2UJnIBkX3v8NKtxdbk34PnYBM7gPmksp98WnqQ8YOTQzry2g1 80flzlKSoPUbK2jDRC81gQ== /in/edgar/work/0000950137-00-004633/0000950137-00-004633.txt : 20001107 0000950137-00-004633.hdr.sgml : 20001107 ACCESSION NUMBER: 0000950137-00-004633 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000930 FILED AS OF DATE: 20001106 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TRUSERV CORP CENTRAL INDEX KEY: 0000025095 STANDARD INDUSTRIAL CLASSIFICATION: [5072 ] IRS NUMBER: 362099896 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-18397 FILM NUMBER: 753817 BUSINESS ADDRESS: STREET 1: 8600 WEST BRYN MAWR AVE CITY: CHICAGO STATE: IL ZIP: 60631 BUSINESS PHONE: 7736955000 MAIL ADDRESS: STREET 1: 8600 W. BRYN MAWR AVENUE CITY: CHICAGO STATE: IL ZIP: 60631-3505 FORMER COMPANY: FORMER CONFORMED NAME: COTTER & CO DATE OF NAME CHANGE: 19920703 10-Q 1 c58275e10-q.txt QUARTERLY REPORT 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2000 or ------------------ ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ---------------- ---------------- Commission file number 2-20910 ----------------------------------------- TRUSERV CORPORATION - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) DELAWARE 36-2099896 - ------------------------------- ------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 8600 West Bryn Mawr Avenue Chicago, Illinois 60631-3505 - --------------------------- ------------- (Address of principal executive offices) (Zip Code) (773) 695-5000 ---------------------------------------------------- (Registrant's telephone number, including area code) Not applicable ---------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No --- --- The number of shares outstanding of each of the issuer's classes of common stock, as of October 28, 2000. Class A Common Stock, $100 Par Value. 473,109 Shares Class B Common Stock, $100 Par Value. 1,720,552 Shares 1 2 PART I - FINANCIAL INFORMATION Item 1. FINANCIAL STATEMENTS TRUSERV CORPORATION CONDENSED CONSOLIDATED BALANCE SHEET (In thousands)
September 30, December 31, 2000 1999 ------------ ----------- (UNAUDITED) ASSETS Current assets: Cash and cash equivalents $ 1,745 $ 1,815 Accounts and notes receivable, net of allowance for doubtful account of $9,767 and $5,613 438,747 460,419 Inventories (note 5) 487,109 482,415 Other current assets 26,071 9,937 ---------- ---------- Total current assets 953,672 954,586 Properties, net 222,005 244,845 Goodwill, net 112,247 114,537 Other assets 29,859 34,179 ---------- ---------- TOTAL ASSETS $1,317,783 $1,348,147 ========== ==========
See Notes to Condensed Consolidated Financial Statements. 2 3 TRUSERV CORPORATION CONDENSED CONSOLIDATED BALANCE SHEET (In thousands, except share data)
September 30, December 31, 2000 1999 ------------ ----------- (UNAUDITED) LIABILITIES AND CAPITALIZATION Current liabilities: Accounts payable $ 459,814 $ 544,904 Accrued expenses 86,312 75,347 Short-term borrowings 218,118 167,007 Current maturities of notes, long-term debt and capital lease obligations 84,739 88,088 ----------- ----------- Total current liabilities 848,983 875,346 ----------- ----------- Long-term debt and obligations under capital leases 302,633 309,796 ----------- ----------- Capitalization: Promissory (subordinated) and installment notes 83,037 83,804 Class A common stock, net of subscriptions receivable of $3,734 and $3,874; 750,000 shares authorized; 509,340 and 511,440 shares issued and subscribed 47,200 47,270 Class B nonvoting common stock and paid-in capital; 4,000,000 shares authorized; 1,720,552 and 1,764,797 shares issued and fully paid 182,314 177,779 Loss allocation to Members (note 3) (113,918) - Deferred patronage dividends (13,782) (14,063) Retained earnings (accumulated deficit) (17,655) (130,939) Accumulated other comprehensive income (1,029) (846) ----------- ----------- Total capitalization 166,167 163,005 ----------- ----------- TOTAL LIABILITIES AND CAPITALIZATION $ 1,317,783 $ 1,348,147 =========== ===========
See Notes to Condensed Consolidated Financial Statements. 3 4 TRUSERV CORPORATION CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (In thousands) (UNAUDITED)
FOR THE THIRTEEN FOR THE THIRTY-NINE WEEKS ENDED WEEKS ENDED -------------------------------- -------------------------------- September 30, October 2, September 30, October 2, 2000 1999 2000 1999 ------------ ----------- ------------ ----------- Revenues $ 944,269 $ 1,117,496 $ 3,109,136 $ 3,452,496 Costs and expenses: Cost of revenues 872,388 1,047,249 2,897,681 3,246,326 Logistics and manufacturing expenses 21,986 23,485 68,520 76,119 Selling, general and administrative expenses 27,532 29,039 86,079 87,609 Interest paid to Members 2,776 3,779 8,407 10,532 Other interest expense 14,981 12,569 42,906 34,906 Gain on sale of properties (233) (3,459) (1,300) (9,307) Other (income) loss, net (note 4) (4,824) 436 (5,891) (55) ----------- ----------- ----------- ----------- 934,606 1,113,098 3,096,402 3,446,130 ----------- ----------- ----------- ----------- Net margin before income taxes and cumulative effect of a change in accounting principle 9,663 4,398 12,734 6,366 Income tax expense (benefit) 216 (1,381) 288 298 ----------- ----------- ----------- ----------- Net margin before cumulative effect of a change in accounting principle 9,447 5,779 12,446 6,068 Cumulative effect on prior years of a change in accounting principle --- --- --- 6,484 ----------- ----------- ----------- ----------- Net margin (loss) $ 9,447 $ 5,779 $ 12,446 $ (416) =========== =========== =========== ===========
See Notes to Condensed Consolidated Financial Statements. 4 5 TRUSERV CORPORATION CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (In thousands) (UNAUDITED)
FOR THE THIRTY-NINE WEEKS ENDED ------------------------------- September 30, October 2, 2000 1999 ------------ --------- Operating activities: Net margin before cumulative effect of a change in account principle $ 12,446 $ 6,068 Cumulative effect on prior years of a change in accounting principle --- (6,484) Adjustments to reconcile net margin to cash and cash equivalents used for operating activities: Depreciation and amortization 32,915 28,381 Provision for allowance for doubtful accounts 7,372 2,711 Net change in working capital components (86,357) (31,976) -------- -------- Net cash and cash equivalents used for operating activities (33,624) (1,300) -------- -------- Investing activities: Additions to properties owned (10,053) (39,754) Proceeds from sale of properties owned 8,165 26,764 Changes in other assets (733) (6,078) -------- -------- Net cash and cash equivalents used for investing activities (2,621) (19,068) -------- -------- Financing activities: Proceeds from short-term borrowings, net of repayments 51,110 55,993 Proceeds from long-term borrowings 1,068 703 Annual patronage dividend paid --- (14,507) Payment of notes, long-term debt, lease obligations and common stock (16,003) (15,989) -------- -------- Net cash and cash equivalents provided by financing activities 36,175 26,200 -------- -------- Net increase (decrease) in cash and cash equivalents (70) 5,832 Cash and cash equivalents at beginning of period 1,815 1,650 -------- -------- Cash and cash equivalents at end of period $ 1,745 $ 7,482 ======== ========
See Notes to Condensed Consolidated Financial Statements. 5 6 TRUSERV CORPORATION NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) NOTE 1 - GENERAL The condensed consolidated balance sheet at September 30, 2000 and the condensed consolidated statement of operations and statement of cash flows for the thirteen and thirty-nine weeks ended September 30, 2000 and October 2, 1999 are unaudited and, in the opinion of the management of the Company, include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of financial position, results of operations and cash flows for the respective interim periods. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. This financial information should be read in conjunction with the consolidated financial statements for the year ended December 31, 1999 included in the Company's 1999 Annual Report on Form 10-K. NOTE 2 - RECLASSIFICATIONS Certain reclassifications have been made to the prior period financial statements to conform with the current presentation. These reclassifications had no effect on net margin (loss) for any period. NOTE 3 - ESTIMATED PATRONAGE DIVIDENDS AND LOSS ALLOCATION TO MEMBERS If financial and operating conditions permit, patronage dividends are declared and paid by the Company after the close of each fiscal year. No annual patronage dividend was declared for 1999. The most recent annual patronage dividend was distributed through a payment of approximately 40% of the total distribution in cash, with the balance being paid through the issuance of the Company's Class B nonvoting common stock. The estimated patronage dividend accrued for the period ended September 30, 2000 is $12,799,000. There was no estimated patronage dividend for the corresponding period in 1999. During the third quarter of fiscal year 2000, management developed, and the Board of Directors approved, a plan to equitably allocate to Members the loss incurred in 1999. This loss was previously recorded as a decrease to Retained Earnings as of December 31, 1999, resulting in an Accumulated Deficit. The Company has allocated the 1999 loss by establishing a Loss Allocation account as a contra-equity account in the condensed consolidated balance sheet with the offsetting increase recorded to Retained Earnings (Accumulated Deficit). The Loss Allocation account reflects the sum of each Member's proportionate share of the 1999 loss, after being reduced by certain amounts that are not allocable to Members. The Loss Allocation account is not a receivable from Members and does not represent an amount currently due from Members. Rather, the Loss Allocation 6 7 account will be satisfied, on a Member by Member basis, by withholding the portion of future patronage dividends that would have been paid in Qualified B Stock, at par value, and applying such amount as a reduction in the Loss Allocation account until fully satisfied. The current levels of Members' stock investments in the Company will not be affected. However, in the event a Member should terminate as a shareholder of the Company, any unsatisfied portion of that Member's Loss Allocation account will be satisfied by reducing the redemption amount of the Member's stock investment in the Company. The accrual of the estimated patronage dividend of $12,799,000 and the establishment of the Loss Allocation account of $113,918,000 are non-cash financing activities. NOTE 4 - OTHER INCOME During the third quarter of fiscal year 2000, the Company purchased from an insurance company non-participating annuity contracts to satisfy pension obligations related to certain former employees who were fully vested in their pension benefits. As a result of this transaction, the Company recognized as a pre-tax gain in the third quarter of fiscal year 2000 approximately $5 million related to the settlement of these pension obligations. Such gain has been recorded as Other income, net. NOTE 5 - INVENTORIES Inventories consisted of: September 30, December 31, 2000 1999 ---- ---- (UNAUDITED) (In thousands) Manufacturing inventories Raw materials $ 3,228 $ 2,473 Work-in-process and finished goods 32,271 33,508 ---------- ---------- 35,499 35,981 Merchandise inventories 451,610 446,434 ---------- ---------- Total $ 487,109 $ 482,415 ========== ========== Inventories are stated at the lower of cost, determined on the "first-in, first-out" basis, or market. The Company performs periodic physical inventory counts at its distribution centers; adjustments to recorded inventory quantities and amounts resulting from such counts are recorded after the amount and composition of such adjustments have been analyzed. An extensive review of the physical inventory quantities and amounts will be conducted and adjustments recorded during the fourth quarter of fiscal year 2000. NOTE 6 - SEGMENT INFORMATION The Company operates as a single reportable segment as the largest Member-owned wholesaler cooperative of hardware, lumber and building materials and related merchandise in the United States. Operations outside the United States were immaterial for the periods ended September 30, 2000 and October 2, 1999. The 7 8 Company's sales to its Members are divided into three categories, as follows: (1) warehouse shipment sales (approximately 40% of total sales); (2) direct shipment sales (approximately 57% of total sales); and (3) relay sales (approximately 3% of total sales). Warehouse shipment sales are sales of products purchased, warehoused and resold by the Company upon orders from the Members. Direct shipment sales are sales of products purchased by the Company but delivered directly to Members from manufacturers. Relay sales are sales of products purchased by the Company in response to the requests of several Members for a product which is (i) included in future promotions, (ii) not normally held in inventory and (iii) not susceptible to direct shipment. Generally, the Company will give notice to all Members of its intention to purchase products for relay shipment and then purchase only as many of such products as the Members order. When the product shipment arrives at the Company, it is not warehoused; rather, the Company breaks up the shipment and "relays" the appropriate quantities to the Members who placed orders. The Company's product offering, comprised of more than 63,000 stockkeeping units ("SKUs"), may be divided into seven classes of merchandise which are set forth, with their corresponding percentage of total revenue, in the following table: For the Thirty-nine Weeks Ended ------------------------------- September 30, October 2, 2000 1999 ---- ---- Lumber and Buildings Materials 31.2% 33.6% Farm and Garden 17.1% 16.9% Hardware Goods 16.2% 15.5% Electrical and Plumbing 12.5% 11.9% Painting and Cleaning 10.6% 10.0% Appliance and Housewares 8.3% 8.1% Sporting Goods and Toys 4.1% 4.0% NOTE 7 - CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING PRINCIPLE In April 1998, the American Institute of Certified Public Accountants issued Statement of Position 98-5, "Reporting the Costs of Start-Up Activities", which requires that costs related to start-up activities be expensed as incurred. Prior to 1999, the Company capitalized its costs incurred in connection with opening new distribution centers. The Company adopted the provisions of the SOP in its financial statements for the fiscal year ended December 31, 1999. The effect of the adoption of SOP 98-5 was to record a charge for the cumulative effect of a change in accounting principle of $6,484,000 in order to expense unamortized costs that had been previously capitalized prior to 1999. NOTE 8 - SUBSEQUENT EVENTS The Company signed a letter of intent with an unrelated third party to sell the Company's Lumber and Building Materials division. This sale is expected to close during the fourth quarter of fiscal year 2000. 8 9 Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS THIRTEEN WEEKS ENDED SEPTEMBER 30, 2000 COMPARED TO THIRTEEN WEEKS ENDED OCTOBER 2, 1999 RESULTS OF OPERATIONS: Revenues for the thirteen weeks ended September 30, 2000 totaled $944,269,000. This represented a decrease of $173,227,000, or 15.5%, compared to the comparable period last year. The revenue decrease is predominately attributable to lower revenue in lumber and building materials, which declined $120,676,000, or 30.6%, compared to the same quarter last year. The decline is due to the negative impact of industry wide trends towards lower pricing and unit volume. Gross margins increased by $1,634,000, or 2.3%, and as a percentage of revenues, increased to 7.6% from 6.3% for the comparable period last year. The increase in gross margin percentage resulted from decreased revenues in lumber and building materials, which are direct shipped to Members with lower gross margin percentages. In addition to the shift in sales mix, the gross margin was positively impacted from the reduced transportation costs due to the consolidation of the distribution network and a reduction in estimated capitalizable inventory-related costs. Logistics and manufacturing expenses as a percentage of revenues increased to 2.3% from 2.1% compared to the prior year, primarily as a result of the decrease in revenues. However, such expenses were down $1,499,000, or 6.4%, as the company benefited from prior year initiatives to consolidate the distribution network. Selling, general and administrative (S,G&A) expenses decreased $1,507,000, or 5.2%, and would have been greater except for the reduction in the capitalization of costs to inventory of $7,054,000 as a result of reduced operating expenses subject to the capitalization calculation. S,G&A expenses as a percentage of revenues increased to 2.9% from 2.6% compared to the prior year , primarily as a result of the decrease in revenues. The reduced expenses were generated by the savings from the company's headcount reductions in corporate staff functions, decreased usage of outside services, and reduced travel expenses. Interest paid to Members decreased by $1,003,000, or 26.5%, primarily due to a lower principal balance. Other interest expense increased $2,412,000, or 19.2%, due to higher interest rates. Other income increased by $5,260,000, primarily attributable to the settlement gain recognized upon the purchase of pension annuities to satisfy the pension benefit obligation related to certain retirees. The combinations of margin improvement, reduced logistics and manufacturing and SG&A expenses, and the positive impact recorded in other income related to the pension settlement gain, resulted in a net margin of $9,447,000 for the third quarter of 2000 as compared to a net margin of $5,779,000 for the third quarter of 1999. 9 10 THIRTY-NINE WEEKS ENDED SEPTEMBER 30, 2000 COMPARED TO THIRTY-NINE WEEKS ENDED OCTOBER 2, 1999 RESULTS OF OPERATIONS: Revenues for the thirty-nine weeks ended September 30, 2000 totaled $3,109,136,000 and represented a decrease of $343,360,000, or 9.9%, compared to the comparable period last year. The decrease is attributable to lower revenues in lumber and building materials ($187,258,000 or 17.1%), farm & garden supplies ($53,420,000 or 9.7%) and hardware ($32,108,000 or 6.4%). The lumber and building material sales were negatively impacted by industry wide trends towards lower pricing and unit volumes. Gross margins increased by $5,285,000, or 2.6%, and as a percentage of revenues, increased to 6.8% from 6.0% for the comparable period last year. The increase in gross margin percentage resulted from a decrease in revenues of lumber and building materials, which are direct shipped to Members and have lower gross margin percentages. In addition to the shift in sales mix, the gross margin was positively impacted from the reduced transportation costs due to the consolidation of the distribution network and a reduction in estimated capitalizable inventory-related costs. Logistics and manufacturing expenses as a percentage of revenues remained flat at 2.2% compared to the prior year. Such expenses were down $7,599,000, or 10.0%, as the company benefited from prior year initiatives to consolidate the distribution network. Selling, general and administrative expenses as a percentage of revenues increased to 2.8% from 2.5% compared to the prior year, primarily as a result of the decrease in revenues. Expenses were down $1,530,000, or 1.7%, even after a reduction of $17,946,000 in the capitalization of costs to inventory as a result of reduced operating expenses subject to the capitalization calculation. These reductions are due to the savings from the company's headcount reductions in corporate staff functions and the full period benefit of prior year reductions to consolidate staff functions. In addition, the company responded to weaker sales through programs to further reduce headcount, defer hiring, reduce travel expenses, and reduce spending on outside services. Interest paid to Members decreased by $2,125,000, or 20.2%, primarily due to lower outstanding principal balances. Other interest expense increased $8,000,000, or 22.9%, due to higher interest rates. Other income increased by $5,836,000 primarily attributable to the pension settlement gain. For the fiscal year ended December 31, 1999, the cumulative effect on prior years of a change in accounting principle of $6,484,000 reflects the write-off of start-up costs of converting the systems used by ServiStar Coast to Coast Corporation's distribution centers prior to the merger to those systems currently used by the Company. The write-off is in compliance with SOP 98-5, "Reporting the Costs of Start-up Activities". 10 11 Despite the decrease in revenues of 9.9%, the Company improved its overall operating performance by increasing net margin before the cumulative effect of a change in accounting principle by $6,378,000 as compared to the comparable period last year. In addition to the operating performance improvement, the elimination of the change in accounting principle increased net margin for the thirty-nine weeks ended September 30, 2000 to $12,446,000 as compared to a net loss of $416,000 for the comparable period last year. THIRTY-NINE WEEKS ENDED SEPTEMBER 30, 2000 COMPARED WITH THE YEAR ENDED DECEMBER 31, 1999 LIQUIDITY AND CAPITAL RESOURCES: Cash used in operations in the thirty-nine weeks ended September 30, 2000 was $33,624,000. Inventories increased by $4,694,000 since December 31, 1999 as a result of supporting orders for seasonal merchandise (Inventories decreased by $74,491,000 as compared to October 2, 1999, which is a result of the continued consolidation of the distribution network). Accounts and notes receivable decreased by $21,672,000 since December 31, 1999 (decreased by $106,347,000 as compared to October 2, 1999) as a result of the decrease in revenue. Accounts payable decreased by $85,090,000 since December 31, 1999 as a result of the seasonal terms obtained from vendors causing amounts to become due in the third quarter of 2000. At September 30, 2000, net working capital increased to $104,689,000 from $79,240,000 at December 31, 1999 primarily as a result of decreased accounts payable. The current ratio increased to 1.12 at September 30, 2000 compared to 1.09 at December 31, 1999. At July 1, 1997, the Company had established a $300,000,000 five-year revolving credit facility with a group of banks. These agreements were amended in April 2000. The amended debt agreement includes increased interest rates, new financial ratios and covenants, and the collateralization of the Company's assets. Borrowings outstanding under these agreements were $201,000,000 and $135,000,000 at September 30, 2000 and December 31, 1999, respectively. Under the senior notes and revolving credit facility, the Company is required to meet certain financial ratios and covenants. As of September 30, 2000, the Company was in compliance with the lenders' financial ratios and covenants requirements. The Company's capital is primarily comprised of Class A common stock and retained earnings (accumulated deficit), together with promissory (subordinated) notes and nonvoting Class B common stock issued in connection with the Company's annual patronage dividend. The Company has initiated a moratorium on the redemption of its stock, which the Board of Directors will review from time to time in light of the financial circumstances of the Company, but the Company believes the funds obtained from these capital resources, as well as operations and the credit facilities noted above, will be sufficient to satisfy future capital needs. 11 12 Total capital expenditures, including those made under capital leases, have been reduced significantly compared to the comparable period in 1999. For the thirty-nine weeks ended September 30, 2000 and October 2, 1999, capital expenditures were $10,053,000 and $39,754,000, respectively. Capital expenditures relate primarily to additional equipment and technological improvements at the regional distribution centers and at the corporate headquarters. In early October, the Company has announced plans to sell its Lumber and Building Material division to Builder Marts of America, Inc. The Lumber and Building Materials division generates over 30% of the Company's revenue; however, the sale of the division will not materially impact net margin. This transaction is expected to close in the fourth quarter of fiscal year 2000, with net proceeds reducing total debt outstanding and strengthening the capital structure of the company. Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK The Company's operations are subject to certain market risks, primarily interest rate risk and credit risk. Interest rate risk pertains to the Company's variable rate debt, which totals approximately $215 million at September 30, 2000. A 50 basis point movement in the interest rates would result in an approximate $1.075 million annualized change in interest expense and cash flows. For the most part, interest rate risk is managed through a combination of variable and fixed-rate debt instruments with varying maturities. Credit risk pertains mostly to the Company's trade receivables. The Company extends credit to its members as part of its day-to-day operations. The Company believes that as no specific receivable or group of receivables comprises a significant percentage of total trade receivables, its risk with respect to trade receivables is limited. Additionally, the Company believes that its allowance for doubtful accounts is adequate with respect to member credit risks. 12 13 PART II - OTHER INFORMATION Item 1. LEGAL PROCEEDINGS NONE Item 2. CHANGES IN SECURITIES AND USE OF PROCEEDS NONE Item 3. DEFAULTS UPON SENIOR SECURITIES NONE Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS NONE Item 5. OTHER INFORMATION. NONE Item 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits 27.1 Financial Data Schedule (b) Reports on Form 8-K 1) Current Reports on Form 8-K, filed July 6, 2000 and September 28, 2000. 13 14 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. TRUSERV CORPORATION Date: November 6, 2000 By /s/LEONARD G. KUHR ---------------- ------------------ Leonard G. Kuhr Senior Vice President and Chief Financial Officer (Mr. Kuhr is the principal financial officer and has been duly authorized to sign on behalf of the Registrant.) 14 EX-27.1 2 c58275ex27-1.txt FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONDENSED CONSOLIDATED BALANCE SHEET AND STATEMENT OF OPERATIONS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 9-MOS DEC-31-2000 JAN-01-2000 SEP-30-2000 1,745 0 448,514 9,767 487,109 953,672 489,134 267,129 1,317,783 848,983 302,633 0 0 229,514 (63,347) 1,317,783 3,109,136 3,109,136 2,897,681 2,897,681 147,408 0 51,313 12,734 288 12,446 0 0 0 12,446 0 0
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