-----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, GwHki45l1hAKEraCLTctaDvzqbfErBTWJSlBSKZmqf5SYcLv7RJ2/pmbeVNDIa/k XUyJpkhsVnSqDeVGytcRGg== 0000950123-02-010360.txt : 20021108 0000950123-02-010360.hdr.sgml : 20021108 20021108080642 ACCESSION NUMBER: 0000950123-02-010360 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20021107 ITEM INFORMATION: FILED AS OF DATE: 20021108 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HANOVER DIRECT INC CENTRAL INDEX KEY: 0000320333 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-CATALOG & MAIL-ORDER HOUSES [5961] IRS NUMBER: 138053260 STATE OF INCORPORATION: DE FISCAL YEAR END: 1227 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-08056 FILM NUMBER: 02813257 BUSINESS ADDRESS: STREET 1: 1500 HARBOR BLVD CITY: WEEHAWKEN STATE: NJ ZIP: 07087 BUSINESS PHONE: 2018653800 MAIL ADDRESS: STREET 1: 1500 HARBOR BLVD CITY: WEEHAWKEN STATE: NJ ZIP: 07087 FORMER COMPANY: FORMER CONFORMED NAME: HORN & HARDART CO /NV/ DATE OF NAME CHANGE: 19920703 8-K 1 y65340e8vk.txt HANOVER DIRECT, INC. FORM 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ----------------------------------------------------------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of report (Date of earliest event reported): November 7, 2002 -------------------------------------------------------------- Hanover Direct, Inc. ------------------------------------------------------------- (Exact Name of Registrant as Specified in Charter) 1-12082 ---------------------------------- (Commission File Number) Delaware 13-0853260 - ----------------------------------- ----------------------------- (State or Other Jurisdiction (I.R.S. Employer of Incorporation) Identification Number) 115 River Road Edgewater, New Jersey 07020 - ----------------------------------- -------------- (Address of Principal (Zip Code) Executive Offices) Registrant's telephone number, including area code: (201) 863-7300 ------------------- - -------------------------------------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) ITEM 9. REGULATION FD DISCLOSURE. On November 7, 2002, Hanover Direct, Inc. (the "Company") issued a press release announcing operating results for the thirteen and thirty-nine weeks ended September 28, 2002. A copy of such press release is furnished under this Form 8-K pursuant to Regulation FD. EXHIBITS Exhibit 20.1 Press Release dated November 7, 2002, announcing operating results for the thirteen and thirty-nine weeks ended September 28, 2002. 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 hereunto duly authorized. HANOVER DIRECT, INC. -------------------------------------- (Registrant) November 7, 2002 By: /s/ Edward M. Lambert -------------------------------------- Name: Edward M. Lambert Title: Executive Vice President and Chief Financial Officer EX-20.1 3 y65340exv20w1.txt PRESS RELEASE DATED NOVEMBER 7, 2002 EXHIBIT 20.1 [HANOVER DIRECT LOGO] FOR IMMEDIATE RELEASE CONTACT: Hanover Direct, Inc. The MWW Group Thomas C. Shull Rich Tauberman President & Chief Executive Officer Tel: (201) 507-9500 Tel: (201) 272-3106 Hanover Direct Announces Improvement in Third Quarter Results EDGEWATER, NJ, November 8, 2002 -Hanover Direct, Inc. today announced operating results for the 13- and 39-weeks ended September 28, 2002. Hanover Direct reported a net loss of $(4.2) million for the 13- weeks ended September 28, 2002, an improvement of $2.6 million from the net loss of $(6.8) million for the comparable period last year. EBITDA improved over the comparable period in 2001 by $1.9 million to a loss of $(1.4) million for the 13-weeks ended September 28, 2002. The Company reported a net loss of $(4.2) million for the 39-weeks ended September 28, 2002 compared with a net loss of $(1.7) million for the comparable period last year. The net loss was identical for the 13- and 39- weeks, due to the breakeven results for the first half of 2002. The results for the 39-week periods ended September 28, 2002 and September 29, 2001 include $0.3 million and $24.3 million, respectively, in after tax gains resulting from the sale of the Improvements business and the Kindig Lane Property. Without consideration of these gains, net loss for the 39-weeks ended September 28, 2002 improved by $21.5 million over the comparable period in 2001. EBITDA for the 39-weeks ended September 28, 2002 was $5.0 million versus $16.9 million for the comparable period in the prior year and, prior to the recognition of the Improvements and Kindig Lane gains, increased by $18.3 million over the comparable period in 2001. Net revenues decreased $11.4 million (9.7%) for the 13-week period ended September 28, 2002 to $106.0 million from $117.4 million for the comparable period in 2001. The decrease in net revenues is due principally to softness in demand primarily related to certain brands and reductions in unprofitable circulation. For the 39-week period ended September 28, 2002, net revenues decreased $65.8 million (16.7%) to $329.4 million from $395.2 million for the comparable period in 2001. This decrease was due in part to the sale of the Improvements business on June 29, 2001, which accounted for $34.1 million of the reduction. The discontinuance of the Domestications Kitchen & Garden, Kitchen & Home, Encore and Turiya catalogs contributed an additional $6.2 million to the reduction. The remaining balance of the decrease in net revenues can be attributed to softness in demand primarily related to certain brands and reductions in unprofitable circulation. Net (loss) per common share was $(.06) and $(.11) for the 13- and 39-weeks ended September 28, 2002, respectively. The per share amounts were calculated after deducting the Series B Preferred Stock redemption price increase of $4.2 million for the 13- weeks period and $10.6 million for the 39- weeks period. The weighted average number of shares outstanding used in the per share calculation was 138,315,800 for the 13-week period and 138,268,327 for the 39-week period ended September 28, 2002. A conference call with the management of Hanover Direct, Inc. to review the Fiscal 2002 third quarter and year-to-date operating results will be held on Friday, November 8, 2002 at 10:00 a.m. Eastern Time. If you would like to participate in the call, please call 800-633-8538 (domestic) or 212-346-6439 (international) between 9:50 a.m. and 9:55 a.m. Eastern Time. A replay of the conference call will be available one hour after the call until 11:00 p.m. Eastern Time on November 9, 2002 and can be accessed by calling 800-633-8284 (domestic) or 402-977-9140 (international), Access Code #21014285. ABOUT HANOVER DIRECT, INC. Hanover Direct, Inc. (AMEX: HNV) and its business units provide quality, branded merchandise through a portfolio of catalogs and e-commerce platforms to consumers, as well as a comprehensive range of Internet, e-commerce, and fulfillment services to businesses. Hanover Brands, Inc. is comprised of the Company's catalog and e-commerce web site portfolio of home fashions, apparel and gift brands, including Domestications, The Company Store, Company Kids, Silhouettes, International Male, Scandia Down, and Gump's By Mail. The Company owns Gump's, a retail store based in San Francisco. Each brand can be accessed on the Internet individually by name. erizon, Inc. is comprised of Keystone Internet Services, Inc. (WWW.KEYSTONEINTERNET.COM), the Company's third party fulfillment operation, and also provides the logistical, IT and fulfillment needs of Hanover Brands, Inc. Information on Hanover Direct, including each of its subsidiaries, can be accessed on the Internet at WWW.HANOVERDIRECT.COM. ================================================================================ HANOVER DIRECT, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands of dollars, except share amounts) September 28, December 29, 2002 2001 ------------ --------- (Unaudited) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 959 $ 1,121 Accounts receivable, net 15,593 19,456 Inventories 58,251 59,223 Prepaid catalog costs 18,851 14,620 Deferred tax asset, net 3,300 3,300 Other current assets 3,169 3,000 --------- --------- Total Current Assets 100,123 100,720 --------- --------- PROPERTY AND EQUIPMENT, AT COST: Land 4,395 4,509 Buildings and building improvements 18,205 18,205 Leasehold improvements 9,917 12,466 Furniture, fixtures and equipment 56,489 59,287 --------- --------- 89,006 94,467 Accumulated depreciation and amortization (58,556) (60,235) --------- --------- Property and equipment, net 30,450 34,232 --------- --------- Goodwill, net 9,278 9,278 Deferred tax asset, net 11,700 11,700 Other assets 1,152 1,731 --------- --------- Total Assets $ 152,703 $ 157,661 ========= =========
HANOVER DIRECT, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Continued) (In thousands of dollars, except share amounts)
September 28, December 29, 2002 2001 ------------- ---------- (Unaudited) LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIENCY) CURRENT LIABILITIES: Current portion of long-term debt and capital lease obligations $ 3,802 $ 3,162 Accounts payable 45,488 46,348 Accrued liabilities 19,440 25,132 Customer prepayments and credits 7,398 5,143 --------- --------- Total Current Liabilities 76,128 79,785 --------- --------- NON-CURRENT LIABILITIES: Long-term debt 30,400 26,548 Other 8,319 10,233 --------- --------- Total Non-current Liabilities 38,719 36,781 --------- --------- Total Liabilities 114,847 116,566 --------- --------- SERIES B PARTICIPATING PREFERRED STOCK, authorized, issued and outstanding, 1,622,111 shares at September 28, 2002 and December 29, 2001 87,416 76,823 SHAREHOLDERS' EQUITY (DEFICIENCY): Common Stock, $.66 2/3 par value, 300,000,000 shares authorized; 140,436,729 shares issued and outstanding at September 28, 2002 and 140,336,729 shares issued and outstanding at December 29, 2001 93,625 93,558 Capital in excess of par value 341,864 351,558 Accumulated deficit (481,703) (477,497) --------- --------- (46,214) (32,381) --------- --------- Less: Treasury stock, at cost (2,120,929 shares at September 28, 2002 and 2,100,929 shares at December 29, 2001) (2,996) (2,942) Notes receivable from sale of Common Stock (350) (405) --------- --------- Total Shareholders' Deficiency (49,560) (35,728) --------- --------- Total Liabilities and Shareholders' Equity $ 152,703 $ 157,661 ========= =========
HANOVER DIRECT, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) (In thousands of dollars, except per share amounts) (Unaudited)
For the 13- Weeks Ended For the 39- Weeks Ended ---------------------------- --------------------------- September 28, September 29, September 28, September 29 2002 2001 2002 2001 ------------- ------------ --------- --------- NET REVENUES $ 106,030 $ 117,431 $ 329,393 $ 395,232 --------- --------- --------- --------- OPERATING COSTS AND EXPENSES: Cost of sales and operating expenses 68,890 76,887 210,379 252,502 Special charges 1,463 - 1,696 6,081 Selling expenses 25,355 30,435 76,554 107,491 General and administrative expenses 11,834 13,654 36,806 44,350 Depreciation and amortization 1,393 1,780 4,376 5,679 --------- --------- --------- --------- 108,935 122,756 329,811 416,103 --------- --------- --------- --------- LOSS FROM OPERATIONS (2,905) (5,325) (418) (20,871) Gain on sale of Improvements - - 318 22,818 Gain on sale of Kindig Lane - - - 1,529 --------- --------- --------- --------- (LOSS) INCOME BEFORE INTEREST AND INCOME TAXES (2,905) (5,325) (100) 3,476 Interest expense, net 1,277 1,451 4,016 5,102 --------- --------- --------- --------- LOSS BEFORE INCOME TAXES (4,182) (6,776) (4,116) (1,626) Income tax provision 30 30 90 90 --------- --------- --------- --------- NET LOSS AND COMPREHENSIVE LOSS (4,212) (6,806) (4,206) (1,716) Preferred stock dividends and accretion 4,185 3,092 10,593 8,956 --------- --------- --------- --------- NET LOSS APPLICABLE TO COMMON SHAREHOLDERS $ (8,397) $ (9,898) $ (14,799) $ (10,672) ========= ========= ========= ========= NET LOSS PER COMMON SHARE: Net loss per common share - basic and diluted $ (.06) $ (.05) $ (.11) $ (.05) ========= ========= ========= ========= Weighted average common shares outstanding - basic (thousands) 138,316 212,186 138,268 212,280 ========= ========= ========= ========= Weighted average common shares outstanding - diluted (thousands) 138,316 212,186 138,268 212,280 ========= ========= ========= =========
HANOVER DIRECT, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands of dollars) (Unaudited)
For the 39- Weeks Ended ---------------------------------- September 28, September 29, 2002 2001 -------------- ------------- CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ (4,206) $ (1,716) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization, including deferred fees 5,483 6,147 Special charges -- 2,389 Gain on sale of Improvements (318) (22,818) Gain on sale of Kindig Lane -- (1,529) Compensation expense related to stock options 724 1,601 Changes in assets and liabilities, net of sale of business: Accounts receivable, net 3,863 9,729 Inventories 972 (56) Prepaid catalog costs (4,231) (2,300) Accounts payable (860) (10,245) Accrued liabilities (5,692) (12,101) Customer prepayments and credits 2,255 931 Other non-current liabilities (1,914) (2,070) Other, net (692) 14 -------- -------- Net cash used in operating activities (4,616) (32,024) -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES: Acquisitions of property and equipment (597) (1,459) Proceeds from sale of Improvements 318 30,235 Proceeds from sale of Kindig Lane -- 4,671 -------- -------- Net cash (used) provided by investing activities (279) 33,447 -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES: Net borrowings under Congress revolving loan facility 3,419 4,674 Borrowings under Congress Tranche B term loan facility 3,500 -- Payments under Congress Tranche A term loan facility (1,493) (4,710) Payments under Congress Tranche B term loan facility (864) (801) Payments under capital lease obligations (102) (91) Borrowings under capital lease obligations 32 -- Series B Preferred Stock Transaction Cost Adjustment 216 -- Redemption of 7.5% Convertible Debentures -- (751) Other, net 25 (28) -------- -------- Net cash provided (used) by financing activities 4,733 (1,707) -------- -------- Net decrease in cash and cash equivalents (162) (284) Cash and cash equivalents at the beginning of the year 1,121 1,691 -------- -------- Cash and cash equivalents at the end of the period $ 959 $ 1,407 ======== ======== Supplemental Disclosures of Cash Flow Information: Cash paid for: Interest $ 2,451 $ 4,064 ======== ======== Income taxes $ 193 $ 122 ======== ======== Non-cash investing and financing activities: Series B Participating Preferred Stock redemption price increase $ 10,593 $ -- ======== ======== Stock dividend and accretion of Series A Cumulative Participating Preferred Stock $ -- $ 8,956 ======== ========
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