-----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, jnuIwqf/He2TDHkDMtwfw7c4CbohtEbDNPO6Yd//9FPkr3xrUQN4W1ibIybG0ADl KUaj9tbr4aj/C/+N7PzRAQ== 0000037914-95-000007.txt : 19950615 0000037914-95-000007.hdr.sgml : 19950615 ACCESSION NUMBER: 0000037914-95-000007 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950128 FILED AS OF DATE: 19950315 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: FOODARAMA SUPERMARKETS INC CENTRAL INDEX KEY: 0000037914 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-GROCERY STORES [5411] IRS NUMBER: 210717108 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1102 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-05745 FILM NUMBER: 95520725 BUSINESS ADDRESS: STREET 1: 922 HIGHWAY 33, STREET 2: BLDG 6 CITY: FREEHOLD STATE: NJ ZIP: 07728 BUSINESS PHONE: 908-462-4700 MAIL ADDRESS: STREET 1: 922 HIGHWAY 33 STREET 2: BLDG 6 CITY: FREEHOLD STATE: NJ ZIP: 07728 10-Q 1 10Q -1ST QTR 1995 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 January 28, 1995 Commission file number 1-5745-1 FOODARAMA SUPERMARKETS, INC. Building 6, Suite 1 922 Highway 33 Freehold, N.J. 07728 I.D. # 21-0717108 Telephone #908-462-4700 Indicate by check mark whether the Registrant (1) has filed all annual, quarterly and other reports required to be filed with the Commission and (2) has been subject to the filing require- ments for at least 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 close of the period covered by this report. OUTSTANDING AT CLASS January 28, 1995 Common Stock 1,118,150 shares $1 par value FOODARAMA SUPERMARKETS, INC. PART I. FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Balance Sheets January 28, 1995 and October 29, 1994 Consolidated Statements of Operations For the thirteen weeks ended January 28, 1995 and January 29, 1994 Consolidated Statements of Cash Flows for the thirteen weeks ended January 28, 1995 and January 29, 1994 Notes to the Consolidated Financial Statements Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K PART I FINANCIAL INFORMATION FOODARAMA SUPERMARKETS, INC AND SUBSIDIARIES Consolidated Balance Sheets (IN THOUSANDS) January 28, October 29, 1995 1994 (Unaudited) (Audited) ASSETS Current assets: Cash and cash equivalents $ 4,971 $ 5,542 Merchandise inventories 29,811 29,800 Receivables and other current assets 5,919 6,276 Patronage dividend receivable 604 3,717 Total current assets 41,305 45,335 Property and equipment: Land 1,762 1,762 Buildings and improvements 2,132 2,132 Leaseholds and leasehold improvements 33,103 33,146 Equipment 49,644 50,860 Property under capital leases 9,649 9,649 Equipment under capital leases 5,592 7,140 101,882 104,689 Less accumulated depreciation and amortization including $8,424, 1995 and $9,397, 1994 relating to property and equipment under capital leases 44,873 45,612 57,009 59,077 Other assets: Investments in related party 9,215 9,215 Intangibles 7,406 7,508 Other 10,243 9,686 26,864 26,409 $125,178 $130,821 (continued) See accompanying notes to consolidated financial statements. FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES Consolidated Balance Sheets (IN THOUSANDS EXCEPT SHARE DATA) January 28, October 29, 1995 1994 (Unaudited) (Audited) LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Current portion of long-term debt $ 10,799 $ 10,830 Current portion of long-term debt, related party 345 349 Current portion of obligations under capital leases 776 813 Accounts payable: Related party 19,554 20,538 Others 7,531 11,005 Accrued expenses 9,108 8,464 Deferred income tax liability 2,010 2,010 Total current liabilities 50,123 54,009 Long-term debt 26,990 27,817 Long-term debt, related party 615 767 Obligations under capital leases 8,599 8,855 Deferred income taxes 2,730 2,730 Other long term liabilities 5,605 5,959 Total long-term liabilities 44,539 46,128 Mandatory redeemable preferred stock $12.50 par; authorized 1,000,000 shares; issued 136,000 shares 1,700 1,700 Shareholders' equity: Common stock, $1.00 par; authorized 2,500,000 shares; issued 1,621,627 shares 1,622 1,622 Capital in excess of par 2,351 2,351 Retained earnings 32,150 32,318 Minimum pension liability adjustment (685) (685) 35,483 35,606 Less 503,477 shares, held in treasury, at cost 6,622 6,622 28,816 28,984 $ 125,178 $ 130,821 See accompanying notes to consolidated financial statements. FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES Consolidated Statements of Operations - Unaudited (IN THOUSANDS - EXCEPT PER SHARE DATA) 13 Weeks Ended January 28, January 29, 1995 1994 Sales $ 151,748 $ 157,491 Cost of merchandise sold 114,124 118,789 Gross profit 37,624 38,702 Store operating, general and administrative expenses 36,316 37,400 Income from operations 1,308 1,302 Interest - net 1,298 1,236 Income before taxes 10 66 Income tax 3 26 Income before cumulative effect of change in accounting 7 40 Cumulative effect of change in accounting, (net of taxes of $61) ( 175) - Net (loss) income $ ( 168) $ 40 (Loss) income per share before cumulative effect of change in accounting $ ( .02) $ .01 Cumulative effect of change in accounting, net of taxes ( .16) 0 Net (loss)income per share $ ( .18) $ .01 Weighted average number of common shares outstanding 1,118,150 1,118,150 Dividends per share -0- -0- See accompanying notes to consolidated financial statements. FOODARAMA SUPERMARKETS, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows - Unaudited (IN THOUSANDS) Oct.30,1994 Oct.31,1993 to Jan.28,1995 to Jan.29,1994 Cash flows from operating activities: Net (loss) income $ ( 168) $ 40 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 2,211 2,272 Amortization, intangibles 185 397 Amortization, deferred financing costs 43 147 Amortization, escalation rents 148 151 Amortization, other assets 32 204 Changes in assets and liabilities: (Increase) decrease in inventories ( 11) 1,396 Decrease in receivables and other assets 357 2,559 (Increase) in other assets ( 715) ( 16) Decrease in patronage dividend 3,113 3,390 (Decrease)in accounts payable (4,458) ( 3,234) Increase (decrease) in other liabilities 142 ( 3,367) Net cash provided by operating activities 879 3,939 Cash flows from investing activities: Purchase of property and equipment ( 143) ( 3,225) Net cash used in investing activities ( 143) ( 3,225) Cash flows from financing activities: Principal payments under long-term debt (1,014) ( 658) Principal payments under capital lease obligations ( 293) ( 370) Net cash used in financing activities (1,307) ( 1,028) NET INCREASE (DECREASE)IN CASH AND CASH EQUIVALENTS (571) ( 314) CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 5,542 4,765 CASH AND CASH EQUIVALENTS, END OF PERIOD $ 4,971 $ 4,451 See accompanying notes to consolidated financial statements. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Note 1 Basis of Presentation The unaudited condensed Consolidated Financial Statements as of January 28, 1995, have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and rule 10-01. The balance sheet at October 29, 1994 has been taken from the audited financial statements at that date. In the opinion of the management of the Registrant, all adjustments (consisting only of normal recurring accruals) which the Registrant considers necessary for a fair presentation of the results of operations for the period have been made. Certain financial information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. The reader is referred to the consolidated financial statements and notes thereto included in the Registrant's annual report on Form 10-K/A for the year ended October 29, 1994. The Registrant has classified its debt to institutional lenders as of January 28, 1995 and October 29, 1994 according to the payment schedules in the original loan agreements. While the Registrant was in default of these agreements, it concluded a refinancing on February 15, 1995 and repaid those lenders. These results are not necessarily indicative of the results for the entire fiscal year. Note 2 Adoption of Accounting Standards Employee Benefit plans Effective October 30, 1994, the Registrant adopted Statement of Financial Accounting Standards No. 112, "Employers' Accounting for Postemployment Benefits." SFAS No. 112 requires the accrual for postemployment benefits provided to former or inactive employees. The effect of this change resulted in a pre tax charge of $236,000 and an after tax charge of $175,000 or $.16 per share. The registrant previously charged these amounts to expense on a cash basis. Effective October 31, 1993, the Registrant adopted Statement of Financial Accounting Standards (SFAS) No. 106, "Employers' Accounting for Postretirement Benefits other than Pensions." The Registrant provides limited postretirement medical benefits to certain individuals under deferred compensation agreements. SFAS No. 106 requires the Registrant to accrue the estimated cost of retiree benefit payments during the years the employee provides services. The Registrant previously expensed the costs of such benefits as incurred. The Registrant recognized the cumulative effect of this liability on the immediate recognition basis. The cumulative effects as of January 29, 1994, of adopting SFAS No. 106 were an increase in accrued postretirement benefits and a decrease in pre tax earnings of $146,000 ($.08 per share), which have been included in the Registrant's financial statements for the fiscal quarter ended January 29, 1994. The Registrant's liability for such postretirement benefits are not funded. The effect of SFAS No. 106 on earnings for the fiscal quarter ended January 28, 1995 was not material. Income Taxes In the fiscal quarter ended January 29, 1994, the Registrant adopted statement of Financial Accounting Standards (SFAS) No. 109. "Accounting for Income Taxes". The effect of adopting SFAS No. 109 on the Registrant's financial statements was immaterial. Part I - Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations Financial Condition and Liquidity On February 15, 1995, the Company entered into a Revolving Credit and Term Loan Agreement ("the Agreement") with a group of banks providing for a total commitment of $38,000,000, secured by substantially all of the Company's assets. The proceeds from this financing were utilized to repay the Company's Senior notes and bank debt which at January 28, 1995 totaled $34,300,000 and to provide for a working capital facility to fund future operations and capital expenditures, as necessary. The Company was in default under the old loan agreements since July 31, 1993. The Agreement consist of three Term Loans (A, B and C) and a Revolving Note. Term Loan A totals $2,000,000, bears interest at 2% over prime, and is due within six months from closing. Term Loan B totals $8,500,000, bears interest at 2% over prime and is due within 1 year from closing. Term Loans A an B are expected to be repaid from asset sales or equipment refinancing. Term Loan C totals $12,500,000 and bears interest at 2% over prime until Term Loans A and B are repaid, at which time interest is reduced to 1.25% over prime. Term Loan C is payable in quarterly installments commencing March 31, 1996 thru December 31, 1998. The Revolving Note, with a total availability of $15,000,000 bears interest at 1.5% over prime until Term Loans A and B are repaid, at which time interest is reduced to 1.25% over prime. A commitment fee of 1/2 of 1 percent is charged on the unused portion of the Revolving Note. Pursuant to the provisions of the existing loan agreements, the Company is required to pay a special premium totaling $1,100,000. Additionally, the Company is required to pay the new lenders a facility fee of $1,000,000 and an annual administrative fee of $150,000. The Company expects to record a write off of approximately $1,600,000 in the second quarter of 1995 on the early extinguishment of debt. The Agreement contains certain affirmative and negative covenants which, among other matters will, (i) restrict capital expenditures, (ii) require the maintenance of certain levels of net worth and earnings before interest, taxes, depreciation and amortization, and maintenance of (iii) fixed charge coverage and total liabilities to net worth ratios. The Company expects to be in compliance with such covenants through fiscal 1995. Working Capital At January 28, 1995, the Registrant had a working capital deficiency of $8,818 compared to a deficiency of $8,674 at October 29, 1994 and a deficiency of $30,644 at January 29, 1994 which was the result of reflecting $28,379 of debt in default as a current liability. Working capital ratios were as follows: January 28, 1995 0.8 to 1.0 October 29, 1994 0.8 to 1.0 January 29, 1994 0.6 to 1.0 Cash flows (in millions) were as follows: 1/28/95 1/29/94 Operating activities... $ 0.9 $ 3.9 Investing activities... (0.1) (3.2) Financing activities... (1.3) (1.0) Totals $(0.5) $(1.0) At January 28, 1995, the Registrant had no available lines of credit, which condition changed on February 15, 1995 as a result of the refinancing noted above. No cash dividends have been paid on the Registrant's common stock since 1979. The Registrant is prohibited from payment of same under its loan agreement and the terms of the Preferred Stock held by Wakefern Food Corporation. No cash dividends have been paid on the Preferred Stock which was issued in February 1993. Fiscal 1995 capital expenditures are projected at $7.6 million with depreciation of approximately $8.7 million. Results of Operations (13 weeks ended January 28, 1995 compared to 13 weeks ended January 29, 1994) Sales: Same store sales from the twenty stores in operation in both periods decreased 2.17% in the current year period versus the prior year period. Gross Profit: Gross profit on sales increased slightly to 24.8% of sales compared to 24.6% in the prior year period. Patronage dividends, applied as a reduction of the cost of merchandise sold, were $1.2 million compared to $.9 million in the prior year period. Operating Expenses: Store operating, general and administrative expenses as a percent of sales were 23.9% versus 23.7% in the prior year period. Although the reduction in sales in the current period contributed to the increase in percent, in dollars the current period reflects a reduction of $1.1 million. Interest Expense: Interest expense rose slightly to $1.319 million from $1.247 million while interest income was $21,000 compared to $11,000 for the prior period. The prime interest rate was 8 1/2% during the current period versus 6% in the prior year period which contributed to the increase in interest expense. Income Taxes: An income tax rate of 26% has been used in the current period based on the full fiscal 1994 year rate while a rate of 40% was used in the prior year period. Net Income: Net income before the cumulative effect of a change in accounting in the current period was $7,000 and after the cumulative effect of a change in accounting was a loss of $168,000, compared to $40,000 in the prior year period. (Loss)earnings per share (after preferred stock dividends of $34,000 in both periods) was $(.02) compared to $0.1 in the prior year period. Total shares outstanding were 1,118,150 in both periods. PART II OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Exhibits: NONE (b) No reports on Form 8-K were required to be filed for the 13 weeks ended January 28, 1995. 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. FOODARAMA SUPERMARKETS, INC. (Registrant) Date: March 14, 1995 /S/ MICHAEL SHAPIRO (Signature) Michael Shapiro Senior Vice President Chief Financial Officer Date: March 14, 1995 /S/ JOSEPH C. TROILO (Signature) Joseph C. Troilo Senior Vice President Principal Accounting Officer EX-27 2
5 1,000 3-MOS YEAR OCT-28-1995 OCT-29-1994 JAN-28-1995 OCT-29-1994 4971 5542 0 0 6575 0 (884) 0 29811 29800 41305 45335 101882 104689 (44873) (45612) 125178 130821 50123 54009 0 0 1622 1622 1700 1700 0 0 27194 27362 125178 130821 151748 157491 0 0 114124 118789 0 0 36316 37400 0 0 1298 1236 10 66 3 26 7 40 0 0 0 0 (175) 0 (168) 40 (.02) .01 0 0
-----END PRIVACY-ENHANCED MESSAGE-----