-----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, RIumG7JelIoDuxSNrVIWKn7gc9MaxBu4+odTMUWoJrjLPfb36WJgecSoMP6zAPIP tGzBG2QJBHcRcEdkhVcrug== 0000950123-04-006190.txt : 20040512 0000950123-04-006190.hdr.sgml : 20040512 20040511214539 ACCESSION NUMBER: 0000950123-04-006190 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040511 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20040512 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: 04797645 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 y97412e8vk.txt 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): MAY 11, 2004 HANOVER DIRECT, INC. -------------------------------------------------- (EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER) 1-08056 ------------------------ (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 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL STATEMENTS AND EXHIBITS. (c) Exhibits Exhibit 99.1 Press Release, dated May 11, 2004, announcing operating results for the thirteen weeks ended March 27, 2004. ITEM 9. REGULATION FD DISCLOSURE On May 11, 2004, Hanover Direct, Inc. (the "Company") issued a press release announcing operating results for the thirteen weeks ended March 27, 2004. A copy of such press release is furnished as an exhibit to this Form 8-K. ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION. On May 11, 2004, the Company issued a press release announcing operating results for the thirteen weeks ended March 27, 2004. A copy of such press release is furnished as an exhibit to this Form 8-K. 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) May 11, 2004 By: /s/ Charles E. Blue -------------------------------- Name: Charles E. Blue Title: Senior Vice President and Chief Financial Officer EX-99.1 2 y97412exv99w1.txt PRESS RELEASE EXHIBIT 99.1 [HANOVER GRAPHIC] FOR IMMEDIATE RELEASE CONTACT: Hanover Direct, Inc The MWW Group Charles Blue Rich Tauberman S.V.P. & Chief Financial Officer Tel: (201) 507-9500 Tel: (201) 272-3389 HANOVER DIRECT REPORTS PROFITABLE FIRST QUARTER EDGEWATER, NJ, May 11, 2004 -Hanover Direct, Inc. today announced operating results for the 13- week period ended March 27, 2004. The Company reported net income applicable to common shareholders of $0.4 million for the 13- weeks ended March 27, 2004, an improvement of $3.9 million over a reported loss of $3.5 million for the comparable period in 2003. The improvement is primarily attributable to the elimination of the preferred stock dividend accretion related to the Series B Participating Preferred Stock, which was part of the Chelsey Recapitalization consummated on November 30, 2003. Total net revenues for the 13- weeks ended March 27, 2004 were $95.3 million, a decrease of $7.2 million (7.0%), from the comparable period in the prior year. The decline was primarily attributable to a reduction in circulation for one of the Company's brands in order to limit the investment in catalog production costs and working capital necessary to maintain inventory for this brand. The majority of this reduction occurred in the first quarter of 2004; however, it is expected that there will be a continuation of this trend, albeit at a lower rate of decline in sales, for the balance of 2004. The Company reported a net income applicable to common shareholders of $0.4 million, or $0.00 per share, for the 13- weeks ended March 27, 2004, compared with a net loss of $3.4 million, or $0.02 per share, for the comparable period in the prior year. These amounts were calculated after deducting earnings attributable to preferred stockholders of $1,000 and preferred dividends and accretion of $3.6 million for the 13- weeks ended March 27, 2004 and March 29, 2003, respectively. The weighted average number of shares of common stock outstanding was 220,173,633 and 138,315,800 for the 13-week period ended March 27, 2004 and March 29, 2003, respectively. This increase in weighted average shares was primarily a result of the Chelsey Recapitalization. The $3.9 million increase in net income was primarily due to: o A favorable impact of $3.6 million due to the Chelsey Recapitalization and exchange of the Series B Participating Preferred Stock for the Series C Participating Preferred Stock with Chelsey. During the 13- weeks ended March 29, 2003 Preferred Stock dividends and accretion were recorded relating to the Series B Participating Preferred Stock. The Series C Participating Preferred Stock has been recorded at the maximum amount of future cash payments; thus, the Company is currently not required to record interest expense relating to the Series C Participating Preferred Stock; o A favorable impact of $1.8 million comprising continued reductions in cost of sales and operating expenses and general and administrative expenses and a decrease in depreciation and amortization; o A favorable impact of $0.5 million due to reductions in interest resulting from lower average borrowings and deferred amendment fees which have become fully amortized relating to the Congress Credit Facility; and o A favorable impact of $0.3 million due to a reduction of special charges recorded. Partially offset by: o An unfavorable impact of $1.9 million due to the non-recurring deferred gain related to the June 29, 2001 sale of the Company's Improvements business recognized during the 13- weeks ended March 29, 2003; and o An unfavorable impact of $0.4 million due to reduction in variable contribution associated with the decline in net revenues. The Company reported that Internet sales continue to demonstrate growth over the prior year reaching 32.2% of total Internet and catalog revenues for the 13- week period ended March 27, 2004. Internet net revenues for the 13- weeks ended March 27, 2004 were $28.6 million, or 12.1% above the comparable fiscal period in 2003. Due to recent changes in management, the Company is postponing the 2004 Annual Meeting of Stockholders scheduled to be held on June 3, 2004 until later in the summer. The Company intends to review the Fiscal 2004 first half operating results at that time rather than at a conference call at this time. 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. The Company's catalog and Internet portfolio of home fashions, apparel and gift brands include 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. Keystone Internet Services, LLC (www.keystoneinternet.com), the Company's third party fulfillment operation, also provides the logistical, IT and fulfillment needs of the Company's catalogs and web sites. 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)
MARCH 27, DECEMBER 27, 2004 2003 ----------- ------------ (UNAUDITED) ASSETS CURRENT ASSETS: Cash and cash equivalents ..................................................... $ 2,434 $ 2,282 Accounts receivable, net of allowance for doubtful accounts of $1,069 and $1,105, respectively ............................................ 12,614 14,335 Inventories ................................................................... 37,646 41,576 Prepaid catalog costs ......................................................... 15,305 11,808 Other current assets .......................................................... 3,294 3,951 -------- -------- Total Current Assets ....................................................... 71,293 73,952 -------- -------- PROPERTY AND EQUIPMENT, AT COST: Land .......................................................................... 4,361 4,361 Buildings and building improvements ........................................... 18,210 18,210 Leasehold improvements ........................................................ 10,108 10,108 Furniture, fixtures and equipment ............................................. 53,331 53,212 -------- -------- 86,010 85,891 Accumulated depreciation and amortization ..................................... (59,125) (58,113) -------- -------- Property and equipment, net ................................................ 26,885 27,778 -------- -------- Goodwill ............................................................................ 9,278 9,278 Deferred tax assets ................................................................. 2,213 2,213 Other assets ........................................................................ 1,742 1,575 -------- -------- Total Assets ............................................................... $111,411 $114,796 ======== ========
Continued on next page. HANOVER DIRECT, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED) (IN THOUSANDS OF DOLLARS, EXCEPT SHARE AMOUNTS)
MARCH 27, DECEMBER 27, 2004 2003 ----------- ------------ (UNAUDITED) LIABILITIES AND SHAREHOLDERS' DEFICIENCY CURRENT LIABILITIES: Short-term debt and capital lease obligations .............................. $ 15,135 $ 13,468 Accounts payable ........................................................... 38,499 41,880 Accrued liabilities ........................................................ 11,997 12,918 Customer prepayments and credits ........................................... 5,866 5,485 Deferred tax liability ..................................................... 2,213 2,213 -------- -------- Total Current Liabilities .............................................. 73,710 75,964 -------- -------- NON-CURRENT LIABILITIES: Long-term debt ............................................................. 8,001 9,042 Series C Participating Preferred Stock, authorized, issued and outstanding 564,819 shares; liquidation preference of $56,482 .......... 72,689 72,689 Other ...................................................................... 4,097 4,609 -------- -------- Total Non-current Liabilities .......................................... 84,787 86,340 -------- -------- Total Liabilities ...................................................... 158,497 162,304 -------- -------- SHAREHOLDERS' DEFICIENCY: Common Stock, $0.66 2/3 par value, authorized 300,000,000 shares; 222,294,562 shares issued and 220,173,633 shares outstanding ... 148,197 148,197 Capital in excess of par value ............................................. 302,436 302,432 Accumulated deficit ........................................................ (494,373) (494,791) -------- -------- (43,740) (44,162) -------- -------- Less: Treasury stock, at cost (2,120,929 shares) ............................. (2,996) (2,996) Notes receivable from sale of Common Stock ................................. (350) (350) -------- -------- Total Shareholders' Deficiency ......................................... (47,086) (47,508) -------- -------- Total Liabilities and Shareholders' Deficiency ......................... $111,411 $114,796 ======== ========
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 ------------------------------ MARCH 27, DECEMBER 27, 2004 2003 ----------- ------------ (UNAUDITED) NET REVENUES .................................................................... $ 95,312 $102,474 -------- -------- OPERATING COSTS AND EXPENSES: Cost of sales and operating expenses ....................................... 59,243 65,539 Special charges (income) ................................................... (31) 277 Selling expenses ........................................................... 23,276 24,453 General and administrative expenses ........................................ 10,367 11,278 Depreciation and amortization .............................................. 1,012 1,183 -------- -------- 93,867 102,730 -------- -------- INCOME (LOSS) FROM OPERATIONS ................................................... 1,445 (256) Gain on sale of Improvements ............................................... -- 1,911 -------- -------- INCOME BEFORE INTEREST AND INCOME TAXES ......................................... 1,445 1,655 Interest expense, net ...................................................... 922 1,448 -------- -------- INCOME BEFORE INCOME TAXES ...................................................... 523 207 Provision for Federal income taxes ......................................... 63 -- Provision for state income taxes ........................................... 42 15 -------- -------- NET INCOME AND COMPREHENSIVE INCOME ............................................. 418 192 Preferred stock dividends .................................................. -- 3,632 Earnings Applicable to Preferred Stock ..................................... 1 -- -------- -------- NET INCOME (LOSS) APPLICABLE TO COMMON SHAREHOLDERS .............................................................. $ 417 $ (3,440) ======== ======== NET INCOME (LOSS) PER COMMON SHARE: Net income (loss) per common share - basic and diluted ..................... $ .00 $ (.02) ======== ======== Weighted average common shares outstanding - basic (thousands) ........................................................ 220,174 138,316 ======== ======== Weighted average common shares outstanding - diluted (thousands) ...................................................... 220,666 138,316 ======== ========
HANOVER DIRECT, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (IN THOUSANDS OF DOLLARS) (UNAUDITED)
FOR THE 13-WEEKS ENDED ------------------------------ MARCH 27, DECEMBER 27, 2004 2003 ----------- ------------ (UNAUDITED) CASH FLOWS FROM OPERATING ACTIVITIES: Net income ....................................................................... $ 418 $ 192 Adjustments to reconcile net income to net cash used by operating activities: Depreciation and amortization, including deferred fees ...................... 1,077 1,680 Provision for doubtful accounts ............................................. 87 179 Special charges (income) .................................................... (31) 277 Gain on the sale of Improvements ............................................ -- (1,911) Gain on the sale of property and equipment .................................. -- (2) Compensation expense related to stock options ............................... 4 177 Changes in assets and liabilities: Accounts receivable ......................................................... 1,634 3,186 Inventories ................................................................. 3,930 (294) Prepaid catalog costs ....................................................... (3,497) (3,763) Accounts payable ............................................................ (3,381) 1,708 Accrued liabilities ......................................................... (890) (6,648) Customer prepayments and credits ............................................ 381 2,178 Other, net .................................................................. (309) (455) -------- -------- Net cash used by operating activities ............................................ (577) (3,496) -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES: Acquisitions of property and equipment ...................................... (119) (546) Proceeds from sale of Improvements .......................................... -- 2,000 Costs related to the early release of escrow funds .......................... -- (89) Proceeds from disposal of property and equipment ............................ -- 2 -------- -------- Net cash (used) provided by investing activities ................................. (119) 1,367 -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES: Net borrowings under Congress revolving loan facility ....................... 1,759 5,270 Payments under Congress Tranche A term loan facility ........................ (498) (497) Payments under Congress Tranche B term loan facility ........................ (450) (450) Payments of long-term debt and capital lease obligations .................... (185) (4) Payment of debt issuance costs .............................................. (125) (34) Refund (payment) of estimated Richemont tax obligation on Series B Participating Preferred Stock accretion ....................... 347 (347) -------- -------- Net cash provided by financing activities ........................................ 848 3,938 -------- -------- Net increase in cash and cash equivalents ........................................ 152 1,809 Cash and cash equivalents at the beginning of the year ........................... 2,282 785 -------- -------- Cash and cash equivalents at the end of the period ............................... $ 2,434 $ 2,594 ======== ======== SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid for: Interest .................................................................... $ 733 $ 806 Income taxes ................................................................ $ 6 $ 196 Non-cash investing and financing activities: Series B Participating Preferred Stock redemption price increase ............ $ -- $ 3,285
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