-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, NV9skWQipvGkbmpH2yY1UigLYK1RM141oaJalsm0WedOjFPw1WgGPWtAzWSepQY7 m8wD8BRX9qnyngkg4A88pw== 0000028917-95-000005.txt : 19950612 0000028917-95-000005.hdr.sgml : 19950612 ACCESSION NUMBER: 0000028917-95-000005 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19950429 FILED AS OF DATE: 19950609 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: DILLARD DEPARTMENT STORES INC CENTRAL INDEX KEY: 0000028917 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-DEPARTMENT STORES [5311] IRS NUMBER: 710388071 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-06140 FILM NUMBER: 95546225 BUSINESS ADDRESS: STREET 1: 1600 CANTRELL RD CITY: LITTLE ROCK STATE: AR ZIP: 72201 BUSINESS PHONE: 5013765200 10-Q 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended April 29, 1995 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 1-6140 DILLARD DEPARTMENT STORES, INC. (Exact name of registrant as specified in its charter) DELAWARE 71-0388071 (State or other (IRS Employer jurisdiction of incorporation Identification Number) or organization) 1600 CANTRELL ROAD, LITTLE ROCK, ARKANSAS 72201 (Address of principal executive offices) (Zip Code) (501) 376-5200 (Registrant's telephone number, including area code) Indicate by checkmark 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 Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. CLASS A COMMON STOCK as of April 29, 1995 109,028,595 CLASS B COMMON STOCK as of April 29, 1995 4,017,061 PART I FINANCIAL INFORMATION ITEM 1 Financial Statements CONSOLIDATED BALANCE SHEETS DILLARD DEPARTMENT STORES, INC. (Unaudited) (Thousands) April 29 January 28 April 30 1995 1995 1994 ASSETS CURRENT ASSETS Cash and cash equivalents $48,889 $51,095 $49,619 Trade accounts receivable 1,034,356 1,102,104 1,031,967 Merchandise inventories 1,584,719 1,362,756 1,480,884 Other current assets 9,410 8,847 5,086 TOTAL CURRENT ASSETS 2,677,374 2,524,802 2,567,556 INVESTMENTS AND OTHER ASSETS 75,653 68,810 68,038 PROPERTY AND EQUIPMENT, NET 1,942,851 1,911,453 1,874,578 CONSTRUCTION IN PROGRESS 33,399 49,469 19,293 BUILDINGS UNDER CAPITAL LEASES 22,831 23,223 24,788 $4,752,108 $4,577,757 $4,554,253 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Trade accounts payable and accrued expenses $660,364 $545,522 $633,105 Commercial paper 129,825 89,906 137,124 Federal and state income taxes 44,967 65,454 46,036 Current portion of long-term debt 55,865 55,903 65,082 Current portion of capital lease obligations 2,038 2,173 2,060 TOTAL CURRENT LIABILITIES 893,059 758,958 883,407 LONG-TERM DEBT 1,173,998 1,178,503 1,236,616 CAPITAL LEASE OBLIGATIONS 22,046 22,279 23,890 DEFERRED INCOME TAXES 294,450 294,450 282,648 STOCKHOLDERS' EQUITY Preferred Stock 440 440 440 Common Stock 1,130 1,130 1,130 Additional paid-in capital 624,086 624,086 622,634 Retained earnings 1,742,899 1,697,911 1,503,488 2,368,555 2,323,567 2,127,692 $4,752,108 $4,577,757 $4,554,253 See notes to consolidated financial statements. CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS DILLARD DEPARTMENT STORES, INC. (Unaudited) (Thousands, except per share data) Three Months Ended Twelve Months Ended April 30 May 1 April 30 May 1 1994 1993 1994 1993 Net sales (including leased departments) $1,326,754 $1,283,941 $5,588,616 $5,251,410 Service charges, interest, 47,522 48,022 182,285 182,393 and other 1,374,276 1,331,963 5,770,901 5,433,803 Cost and expenses: Cost of sales 881,928 853,079 3,643,477 3,405,886 Advertising, selling, administrative and general expenses 327,460 311,210 1,344,603 1,256,628 Depreciation and amortization 47,816 45,716 192,399 175,941 Rentals 11,629 13,395 63,150 65,487 Interest and debt expense 27,414 30,652 121,044 128,564 1,296,247 1,254,052 5,364,673 5,032,506 INCOME BEFORE INCOME TAXES 78,029 77,911 406,228 401,297 Federal and state income taxes 29,650 29,605 154,365 160,030 NET INCOME 48,379 48,306 251,863 241,267 Retained earnings at beginning of period 1,697,911 1,457,443 1,503,488 1,271,275 1,746,290 1,505,749 1,755,351 1,512,542 Cash dividends declared (3,391) (2,261) (12,452) (9,054) RETAINED EARNINGS AT END OF PERIOD $1,742,899 $1,503,488 $1,742,899 $1,503,488 Net income per common share $0.43 $0.43 $2.23 $2.14 Cash dividends declared per common share $0.03 $0.02 $0.08 $0.08 Average shares outstanding 113,046 113,001 112,888 112,888 See notes to consolidated financial statements. CONSOLIDATED STATEMENTS OF CASH FLOWS DILLARD DEPARTMENT STORES, INC. (Unaudited) (Thousands) Three Months Ended April 29 April 30 1995 1994 OPERATING ACTIVITITES Net income $48,379 $48,306 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 48,153 46,118 Changes in operating assets and liabilities: Decrease in trade accounts receivable 67,748 64,563 Increase in merchandise inventories and other current assets (222,526) (177,050) Increase in investments and other assets (7,180) (16,330) Increase in trade accounts payable and accrued expenses and income taxes 94,365 95,644 NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 28,939 61,251 INVESTING ACTIVITIES Purchase of property and equipment (62,752) (42,905) NET CASH USED IN INVESTING ACTIVITIES (62,752) (42,905) FINANCING ACTIVITIES Net increase (decrease) in commercial paper 39,919 (8,152) Principal payments on long-term debt and capital lease obligations (4,911) (9,569) Dividends paid (3,401) (2,250) NET CASH PROVIDED BY FINANCING ACTIVITIES 31,607 (19,971) DECREASE INCREASE IN CASH AND CASH EQUIVALENTS (2,206) (1,625) Cash and cash equivalents at beginning of period 51,095 51,244 CASH AND CASH EQUIVALENTS AT END OF PERIOD $48,889 $49,619 See notes to consolidated financial statements. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. The accompanying unaudited 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. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three month period ended April 29, 1995 are not necessarily indicative of the results that may be expected for the fiscal year ended February 3, 1996 due to the seasonal nature of the business. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's annual report on Form 10-K for the fiscal year ended January 28, 1995. 2. The retail last-in, first-out (LIFO) inventory method is used to value merchandise inventories. Under this method, at April 29, 1995, and April 30, 1994, the LIFO cost of merchandise inventories was approximately $500,000 and $14,500,000, respectively, less than the first-in, first-out (FIFO) cost. At January 28, 1995, the LIFO cost of merchandise inventories was approximately equal to FIFO cost. At January 29, 1994, the LIFO cost of merchandise inventories was approximately $13,200,000 less than FIFO cost. 3. Net sales include leased department sales of $7,300,000 and $8,900,000 for the quarters ending April 29, 1995 and April 30, 1994, respectively. Leased department sales for the twelve months ending April 29, 1995 and April 30, 1994 were $44,600,000 and $61,200,000, respectively. 4. On June 1, 1995, the Company issued $100,000,000 aggregate principal amount of its 6.875% coupon, (6.99% yeild to maturity) notes due June 1, 2005. The notes were sold in an underwritten public offering. ITEM 2 Management's Discussion And Analysis Of Financial Condition And Results Of Operations Results of Operations The following table sets forth operating results expressed as a percentage of net sales for the periods indicated: Three Months Ended Twelve Months Ended April 29 April 30 April 29 April 30 1995 1994 1995 1994 Net sales 100.0% 100.0% 100.0% 100.0% Cost of sales 66.5 66.4 65.2 64.9 Gross Profit 100.0 100.0 100.0 100.0 Advertising, selling, administrative and general expenses 24.7 24.2 24.1 23.9 Depreciation and amortization 3.6 3.6 3.4 3.4 Rentals 0.9 1.0 1.1 1.2 Interest and debt expense 2.0 2.4 2.2 2.4 Total operating expenses 31.2 31.2 30.8 30.9 Other income 3.6 3.7 3.3 3.5 Income before income taxes 5.9 6.1 7.3 7.7 Federal and state income taxes 2.2 2.3 2.8 3.1 Net income 3.7 3.8 4.5 4.6 Sales for the first quarter of 1995 were $1,326,754,000 as compared to $1,283,941,000 for the first quarter of 1994. This is an increase of 3%. The sales increase for comparable stores was 1%. The twelve month sales increase for 1995 over 1994 was 6%, for comparable stores the increase was 4%. Cost of sales increased from 66.4% of net sales for the first quarter of 1994 to 66.5% for the first quarter of 1995. For the twelve months ended April 29, 1995 and April 30, 1994, the increase was from 64.9% to 65.2%. These increases are due to a slightly higher level of markdowns than in the prior year. Advertising, selling, administrative and general expenses increased from 24.2% of net sales for the first quarter of 1994 to 24.7% for the first quarter of 1995, primarily due to an increase in payroll expense in the selling area. For the twelve months ended April 29, 1995 and April 30, 1994 the percent to net sales increased from 23.9% to 24.1%. Depreciation and amortization expense remained constant as a percentage of sales from 1994 in the three and twelve month periods ended April 29, 1995. Rental expense decreased slightly from 1% of net sales for the first quarter of 1994 to .9% of net sales in the three months ended April 29, 1995. For the twelve months ended April 29, 1995 rental expense as a percent of net sales decreased slightly from 1.2% of net sales to 1.1% of net sales in 1995. This was due to a higher proportion of the Company's properties being owned rather than leased. Interest and debt expense decreased from 2.4% of net sales for the first quarter of 1994 to 2.0% of net sales for the first quarter of 1995. For the twelve months ended April 29, 1995 interest and debt expense decreased slightly from 2.4% of net sales in 1994 to 2.2% of net sales in 1995. Interest and debt expense declined as a percentage of net sales due to an overall lower level of debt partially offset by higher interest rates on short-term debt. Service charges, interest and other income decreased to 3.6% of net sales in the first quarter of 1995 from 3.7% of net sales in 1994. For the twelve months ended April 29, 1995 this decreased to 3.3% of net sales from 3.5% of net sales in 1994. The effective federal and state income tax rate was 38% for the first quarter of 1995 and 38% for the first quarter of 1994. Financial Condition The Company's working capital was $1,784,315,000 at April 29, 1995, $1,765,844,000 at January 28, 1995, and $1,684,149,000 at April 30, 1994. The current ratio for these periods was 3.0, 3.3 and 2.9, respectively. The long-term debt to capitalization ratio was 33.6%, 34.1% and 37.2% at April 29, 1995, January 28, 1995, and April 30, 1994, respectively. On June 1, 1995, the Company issued $100,000,000 6.875% notes due June 1, 2005. The proceeds were used to reduce short term borrowings. The Company invested $62,752,000 in capital expenditures for the three months ended April 29, 1995 as compared to $42,905,000 for the three months ended April 30, 1994. In 1995, the Compnay plans to build eleven stores, two of which will be replacement stores and to remodel and expand eight additional stores. In 1994, the Company opened nine new stores, two of which were replacement stores and significantly remodeled and expanded two additional stores. Merchandise inventories increased by 7% from $1,480,884,000 at April 30, 1994 to $1,584,719,000 at April 29, 1995. This increase is due to the opening of seven new stores in 1994 and four stores in the first quarter of 1995. On a comparable store basis, the rate of increase in merchandise inventories was 2%. Fluctuations in certain other balance sheet accounts between January 28, 1995 and April 29, 1995 reflect normal seasonal variations within the retail industry. PART II OTHER INFORMATION ITEM 4 Submission of Matters to a Vote of Security Holders The annual meeting of stockholders of the Company was held on May 20, 1995. The matters submitted to a vote of the stockholders were the election of directors and a stockholder proposal requesting preparation of an employment practices report. The holders of Class A Common Stock elected five directors and the holders of Class B Common Stock elected ten directors. The individuals elected as directors and the votes received were as follows: Nominee For Against Class A Nominees Robert C. Connor 92,412,903 900,660 Will D. Davis 92,354,774 958,789 John Paul Hammerschmidt 92,112,274 1,201,289 William B. Harrison 92,422,169 891,394 J.M. Hessels 92,118,093 1,195,470 Class B Nominees William Dillard 3,998,568 0 Calvin N. Clyde 3,998,568 0 Drue Corbusier 3,998,568 0 Alex Dillard 3,998,568 0 Mike Dillard 3,998,568 0 William Dillard II 3,998,568 0 James I. Freeman 3,998,568 0 John H. Johnson 3,998,568 0 E. Ray Kemp 3,998,568 0 William H. Sutton 3,998,568 0 The voting for the stockholder proposal was as follows: For 10,524,179.92 Against 68,829,043.44 Abstain 10,811,635.64 ITEM 5 Other Information Ratio of Earnings to Fixed Charges The Company has calculated the ratio of earnings to fixed charges pursuant to Item 503 of Regulation S-K of the Securities and Exchange Commission as follows: Three Months Ended Fiscal Year Ended April 29 April 30 January 28 January 29 January 30 February 1 February 2 1995 1994 1995 1994 1993 1992 1991 3.36 3.19 3.72 3.57 3.59 3.40 3.38 ITEM 6 Exhibits and Reports on Form 8-K (a) Exhibit (11): Statement re: Computation of Per Share Earnings Exhibit (12): Statement re: Computation of Ratio of Earnings to Fixed Charges (b) Reports on Form 8-K filed during the first quarter: The Company filed a report dated May 24, 1995 relating to the issue of 6 7/8% Notes of $100,000,000 aggregate principal amount maturing on June 1, 2005. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. DILLARD DEPARTMENT STORES, INC. (Registrant) DATE: June 9, 1995 /s/ James I. Freeman James I. Freeman Senior Vice President & Chief Financial Officer (Principal Financial & Accounting Officer) EXHIBIT INDEX Exhibits to Form 10-Q Exhibit Number Exhibit 11 Statement re: Computation of Per Share Earnings 12 Statement re: Computation of Ratio of Earnings to Fixed Charges EX-11 2 EXHIBIT 11 - STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS Three Months Ended Twelve Months Ended April 29 April 30 April 29 April 30 1995 1994 1995 1994 Average shares outstanding 113,045,656 112,991,719 113,012,890 112,859,235 Net effect of dilutive stock options based on the treasury stock method using average market price 0 9,716 12,163 28,802 Total 113,045,656 113,001,435 113,025,053 112,888,037 Net Income $48,379,000 $48,306,000 $251,863,000 $241,267,000 Less preferred dividends (5,500) (5,500) (22,000) (22,000) Net income available to common shares $48,373,500 $48,300,500 $251,841,000 $241,245,000 Per share $0.43 $0.43 $2.23 $2.14 EX-12 3 EXHIBIT 12 - STATEMENT RE: COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (DOLLAR AMOUNTS IN THOUSANDS) (UNAUDITED) Three Months Ended Fiscal Year Ended April 29 April 30 January 28 January 29 January 30 February 1 February 2 1995 1994 1995 1994 1993 1992 1991 Consolidated pretax income $78,029 $77,911 $406,110 $399,534 $375,330 $322,157 $280,778 Fixed charges (less capitalized interest) 31,299 35,126 145,957 152,604 142,892 128,925 115,125 EARNINGS $109,328 $113,037 $552,067 $552,138 $518,222 $451,082 $395,903 Interest $27,414 $30,652 $124,282 $130,915 $121,940 $109,386 $97,032 Preferred stock dividends 9 9 36 36 35 34 34 Capitalized interest 1,195 301 2,545 1,882 1,646 3,574 1,928 Interest factor in rent expense 3,876 4,465 21,639 21,653 20,917 19,505 18,059 FIXED CHARGES $32,494 $35,427 $148,502 $154,486 $144,538 $132,499 $117,053 Ratio of earnings to fixed charges 3.36 3.19 3.72 3.57 3.59 3.40 3.38
EX-27 4
5 1,000 3-MOS FEB-3-1996 APR-29-1995 48,889 0 1,034,356 15,227 1,584,719 2,677,374 3,128,419 1,129,339 4,752,108 893,059 1,196,044 1,130 0 440 2,366,985 4,752,108 1,326,754 1,374,276 881,928 881,928 0 11,588 27,414 78,029 29,650 48,379 0 0 0 48,379 .43 .43
-----END PRIVACY-ENHANCED MESSAGE-----