-----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, IGQe2TPi4vlwF4rBjSY3Cz8mut4y0YQ2fRh1BOB4gMlWHtOsMvcKbsv0aD3gBXiA /Lw9k08s/soLCdovmLqGtg== 0000039917-96-000013.txt : 19960814 0000039917-96-000013.hdr.sgml : 19960814 ACCESSION NUMBER: 0000039917-96-000013 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960813 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: GARAN INC CENTRAL INDEX KEY: 0000039917 STANDARD INDUSTRIAL CLASSIFICATION: APPAREL & OTHER FINISHED PRODS OF FABRICS & SIMILAR MATERIAL [2300] IRS NUMBER: 135665557 STATE OF INCORPORATION: VA FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-04506 FILM NUMBER: 96609811 BUSINESS ADDRESS: STREET 1: 350 FIFTH AVE CITY: NEW YORK STATE: NY ZIP: 10118 BUSINESS PHONE: 2125632000 MAIL ADDRESS: STREET 1: 350 FIFTH AVENUE CITY: NEW YORK STATE: NY ZIP: 10118 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended June 30, 1996 Commission File No 1-4506 GARAN, INCORPORATED (Exact name of registrant as specified in its charter) VIRGINIA 13-5665557 (State of Incorporation) (I.R.S. Employer Identification No.) 350 Fifth Avenue, New York, NY 10118 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (212) 563-2000 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 than 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 close of the period covered by this report. Class Outstanding June 30, 1996 Common Stock (no par value) 5,069,892 shares PART I. - FINANCIAL INFORMATION GARAN, INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)
THREE MONTHS ENDED ---------------- 6/30/96 6/30/95 ------------- ------------- Net sales $ 37,218,000 $ 33,040,000 Cost of sales 28,085,000 25,948,000 ------------- ------------- Gross margin on sales 9,133,000 7,092,000 Selling and administrative expenses 6,265,000 5,429,000 Interest on capitalized leases 31,000 35,000 Interest income (580,000) (674,000) ------------- ------------- Earnings before provision for income taxes 3,417,000 2,302,000 Provision for income taxes 1,350,000 898,000 ------------- ------------- Net earnings $ 2,067,000 $ 1,404,000 ============ ============= Earnings per share data: Earnings per share $ 0.41 $ 0.28 Average common shares outstanding 5,070,000 5,070,000 Dividends paid per share $ 0.20 $ 0.20
GARAN, INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)
NINE MONTHS ENDED --------------- 6/30/96 6/30/95 ------------- ------------- Net sales $ 97,124,000 $100,088,000 Cost of sales 75,542,000 79,004,000 ------------- ------------- Gross margin on sales 21,582,000 21,084,000 Selling and administrative expenses 16,099,000 17,060,000 Interest on capitalized leases 90,000 104,000 Interest income (1,896,000) (1,946,000) ------------- ------------- Earnings before provision for income taxes 7,289,000 5,866,000 Provision for income taxes 2,879,000 2,288,000 ------------- ------------- Net earnings $ 4,410,000 $ 3,578,000 ============= ============= Earnings per share data: Earnings per share $ 0.87 $ 0.71 Average common shares outstanding 5,070,000 5,070,000 Dividends paid per share $ 0.80 $ 0.80
GARAN, INCORPORATED AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED)
6/30/96 9/30/95 -------------- -------------- ASSETS - ------ Current Assets: Cash and cash equivalents $ 2,790,000 $ 8,649,000 U.S. Government securities - short-term 10,476,000 20,424,000 Accounts receivable, less estimated uncollectibles of $514,000 at 6/30/96 and 9/30/95 26,434,000 25,746,000 Inventories 41,603,000 29,454,000 Other current assets 6,634,000 4,412,000 -------------- -------------- Total current assets 87,937,000 88,685,000 U.S. Government Securities - long-term 12,015,000 12,015,000 Property, plant and equipment, less accumulated depreciation and amortization 15,302,000 15,069,000 Other assets 4,146,000 4,662,000 -------------- -------------- TOTAL $ 119,400,000 $ 120,431,000 ============== ==============
LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities: Accounts payable $ 4,757,000 $ 6,851,000 Accrued liabilities 11,356,000 11,005,000 Federal and state income taxes payable 2,644,000 2,227,000 Current portion of capitalized leases 154,000 154,000 -------------- -------------- Total current liabilities 18,911,000 20,237,000 -------------- -------------- Capitalized lease obligations, net of current portion 2,942,000 3,061,000 Deferred income taxes 2,878,000 2,818,000 -------------- -------------- Shareholders' Equity: Preferred stock ($10 par value) 500,000 shares authorized; none issued Common stock (no par value) 15,000,000 shares authorized; 5,069,892 issued at 6/30/96 and 9/30/95 2,535,000 2,535,000 Additional paid-in-capital 5,821,000 5,821,000 Retained earnings 86,313,000 85,959,000 -------------- -------------- Total shareholders' equity 94,669,000 94,315,000 -------------- -------------- TOTAL $ 119,400,000 $ 120,431,000 ============== ==============
GARAN, INCORPORATED AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
NINE MONTHS ENDED 6/30/96 6/30/95 -------------- -------------- Cash Flows From Operating Activities: Net earnings $ 4,410,000 $ 3,578,000 Non cash items included in earnings: Depreciation and amortization 2,630,000 2,681,000 Provision for losses on accounts receivable 23,000 93,000 Deferred income taxes 60,000 70,000 Changes in assets and liabilities: U.S. Government Securities - short-term 9,948,000 (13,301,000) Accounts receivable (711,000) 18,382,000 Inventories (12,149,000) (6,838,000) Other current assets (2,222,000) 250,000 Accounts payable (2,094,000) (1,427,000) Accrued liabilities 241,000 (2,050,000) Income taxes payable 417,000 37,000 Other assets 516,000 (573,000) -------------- -------------- Net Cash Flows From Operating Activities 1,069,000 902,000 -------------- -------------- Cash Flows From Investing Activities: Sale of U.S. Gov't securities - long-term 0 3,000,000 Purchase of U.S. Gov't securities - long-term 0 (987,000) Additions to property plant and equipment (3,035,000) (2,192,000) Proceeds from sales of property, plant and equipment 282,000 365,000 -------------- -------------- Net Cash Flows From Investing Activities (2,753,000) 186,000 -------------- -------------- Cash Flows From Financing Activities: Payment of dividends (4,056,000) (4,056,000) Repayment of capitalized lease obligations (119,000) (526,000) -------------- -------------- Net Cash Flows From Financing Activities (4,175,000) (4,582,000) -------------- -------------- Decrease in Cash and Cash Equivalents (5,859,000) (3,494,000) Cash and Cash Equivalents At Beginning of Period 8,649,000 7,664,000 -------------- -------------- Cash and Cash Equivalents At End of Period $ 2,790,000 $ 4,170,000 ============== ============== Supplemental Disclosures Cash Paid During The Period For: Interest $ 90,000 $ 104,000 Income taxes 3,432,000 1,597,000 ============== ==============
GARAN, INCORPORATED AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 1996 (UNAUDITED) 1. In the opinion of management, all adjustments necessary to a fair statement of the results of operations have been reflected. 2. Earnings per share are calculated on the basis of the weighted average number of common shares outstanding during the period. 3. Inventories consist of the following:
6/30/96 09/30/95 ------------- ------------- Raw Materials $ 5,809,000 $ 5,135,000 Work in process 9,580,000 9,374,000 Finished Goods 26,214,000 14,945,000 ------------- ------------- $ 41,603,000 $ 29,454,000 ============= =============
ITEM 2. GARAN, INCORPORATED AND SUBSIDIARIES MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FINANCIAL CONDITION At June 30, 1996, working capital was $69,026,000, an increase of $578,000 from September 30, 1995, working capital of $68,448,000. Shareholders' equity at June 30, 1996, was $94,669,000, or $18.67 book value per share, as compared to $94,315,000, or $18.60 book value per share, at September 30, 1995. The increase in book value was a result of the net income for the first nine months of fiscal 1996 offset by the payments of both the 1995 fiscal year-end special dividend and the 1996 regular quarterly dividends. RESULTS OF OPERATIONS Three and Nine Month Periods Ended June 30, 1996 and June 30, 1995 Net sales for the three month period ended June 30, 1996, were $37,218,000 compared to $33,040,000 for the same period last year. Net earnings for the three month period were $2,067,000, equal to $0.41 per share, compared to $1,404,000, or $0.28 per share, last year. The increase in net sales was primarily the result of increased units shipped, particularly in our Disney division. Net sales for the nine month period ended June 30, 1996, were $97,124,000 compared to $100,088,000 last year. Net earnings for the nine month period were $4,410,000, or $0.87 per share, as compared to $3,578,000, or $0.71 per share, last year. The sales decrease was the result of competitive conditions in the marketplace which caused a decline in overall average unit selling prices. The increases in net earnings for both the three and nine month periods were primarily the result of reduced selling and administrative expenses and the increases in grosss margin. Gross margin for the three months ended June 30, 1996, was $9,133,000, or 24.5% of net sales, compared to $7,092,000, or 21.5% of net sales, for the comparable period last year. The increase in gross margin for the period was primarily due to the sales increase in our Disney division, which historically maintains a higher gross margin than our other divisions. (The gross margin for the Disney division is higher than for other divisions, but net sales for this division is subject to a royalty expense which is included in selling and administrative expenses.) Gross margin for the nine months ended June 30, 1996, was $21,582,000, or 22.2% of net sales, as compared to $21,084,000, or 21.1% of net sales, for the comparable period last year. The increase in gross margin as a percentage of sales was the result of improved cost absorption relating to manufacturing expenses. Selling and administrative expenses for the three months ended June 30, 1996, were $6,265,000, or 16.8% of net sales, as compared to $5,429,000, or 16.4% of net sales, for the comparable period last year. Selling and administrative expenses for the nine months ended June 30, 1996, were $16,099,000, or 16.6% of net sales, as compared to $17,060,000, or 17.0% of net sales, for the comparable period last year. The selling and administrative expense increase for the three month period was a result of increased royalty expenses associated with icreased sales in our Disney division. Selling and administrative expenses decreased on an overall basis for the nine month period due to reductions in general overhead expenses. PART II. - OTHER INFORMATION ITEM 6. Exhibits and Reports on Form 8-K. a. Exhibits Exhibit 27. Financial Data Schedule b. Reports on Form 8-K No reports have been filed on Form 8-K during the quarter ended June 30, 1996. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on it's behalf by the undersigned thereunto duly authorized. GARAN, INCORPORATED BY:Seymour Lichtenstein Seymour Lichtenstein Principal Executive Officer BY:William J. Wilson William J. Wilson Principal Financial Officer DATE: August 13, 1996 EX-27 2
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED STATEMENTS OF EARNINGS AND BALANCE SHEETS OF GARAN, INCORPORATED AND SUBSIDIARIES ANNEXED HERETO AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 0000039917 GARAN, INCORPORATED 3-MOS 9-MOS SEP-30-1995 SEP-30-1995 APR-1-1996 OCT-1-1995 JUN-30-1996 JUN-30-1996 2,790,000 2,790,000 10,476,000 10,476,000 26,948,000 26,948,000 514,000 514,000 41,603,000 41,603,000 87,937,000 87,937,000 35,571,000 35,571,000 20,269,000 20,269,000 119,400,000 119,400,000 18,911,000 18,911,000 2,942,000 2,942,000 2,535,000 2,535,000 0 0 0 0 94,669,000 94,669,000 119,400,000 119,400,000 37,218,000 97,124,000 37,218,000 97,124,000 28,085,000 75,542,000 28,085,000 75,542,000 0 0 0 0 31,000 90,000 3,417,000 7,289,000 1,350,000 2,879,000 0 0 0 0 0 0 0 0 2,067,000 4,410,000 0.41 0.87 0 0
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