-----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, mhKgGGrxwUTIks++Lc8epnOZRFVH3DqGEqAGyaHpq0Kn8DcPz1qmyHyNNrpoLOWL W1Kx/JYYukCUX6kykmSZFg== 0000051734-94-000004.txt : 19940617 0000051734-94-000004.hdr.sgml : 19940617 ACCESSION NUMBER: 0000051734-94-000004 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19940430 FILED AS OF DATE: 19940607 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TOYS R US INC CENTRAL INDEX KEY: 0000051734 STANDARD INDUSTRIAL CLASSIFICATION: 5945 IRS NUMBER: 135159250 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-01117 FILM NUMBER: 94533170 BUSINESS ADDRESS: STREET 1: 461 FROM RD CITY: PARAMUS STATE: NJ ZIP: 07652 BUSINESS PHONE: 2012627800 FORMER COMPANY: FORMER CONFORMED NAME: INTERSTATE STORES INC DATE OF NAME CHANGE: 19780525 FORMER COMPANY: FORMER CONFORMED NAME: INTERSTATE DEPARTMENT STORES INC DATE OF NAME CHANGE: 19700702 10-Q 1 FIRST QUARTER 10-Q FILING UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended April 30, 1994 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 1-1117 TOYS "R" US, INC. (Exact name of registrant as specified in its charter) Delaware 13-5159250 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 461 From Road, Paramus, New Jersey 07652 (Address of principal executive offices) (Zip Code) (201) 262-7800 (Registrant's telephone number, including area code) (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 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. As of May 23, 1994, 287,553,496 shares of common stock were outstanding. INDEX PAGE PART I - FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Balance Sheets....................... 3 Consolidated Statements of Earnings............... 4 Consolidated Statements of Cash Flows............. 5 Notes to Consolidated Financial Statements........ 6 Item 2. Management's Discussion - Results of Operations and Financial Condition...................... 7 PART II - OTHER INFORMATION............................ 8 SIGNATURES............................................. 9 Page 3 TOYS "R" US, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands)
April 30, May 1, January 29, 1994 1993 1994 ASSETS Current assets: Cash and cash equivalents $ 238,189 $ 261,907 $ 791,893 Accounts and other receivables 92,912 70,690 98,534 Merchandise inventories 2,025,726 1,745,312 1,777,569 Prepaid expenses and other 57,472 46,341 40,400 Total current assets 2,414,299 2,124,250 2,708,396 Property, equipment and other assets 3,557,299 3,008,563 3,441,213 $ 5,971,598 $ 5,132,813 $ 6,149,609 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Short-term borrowings $ 410,456 $ 146,402 $ 239,862 Accounts payable 1,055,931 909,440 1,156,411 Accrued expenses and other 348,822 289,453 471,782 Income taxes payable 67,437 29,067 206,996 Total current liabilities 1,882,646 1,374,362 2,075,051 Deferred income taxes 221,906 188,178 202,663 Long-term debt 738,725 694,057 723,613 Stockholders' equity: Common stock 29,794 29,794 29,794 Additional paid-in capital 449,325 471,558 454,061 Retained earnings 3,050,386 2,565,288 3,012,806 Foreign currency translation adjustments (45,754) 12,912 (56,021) Treasury shares, at cost (355,430) (203,336) (292,358) 3,128,321 2,876,216 3,148,282 $ 5,971,598 $ 5,132,813 $ 6,149,609 See notes to consolidated financial statements.
Page 4 TOYS "R" US, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited) (In thousands except per share information)
13 Weeks Ended April 30, May 1, 1994 1993 Net sales $ 1,461,933 $ 1,286,479 Costs and expenses: Cost of sales 1,001,203 882,876 Selling, advertising, general & administrative 350,232 308,413 Depreciation and amortization 36,445 30,572 Interest expense - net 14,402 9,249 1,402,282 1,231,110 Earnings before taxes on income 59,651 55,369 Taxes on income 22,071 19,933 Net earnings $ 37,580 $ 35,436 Earnings per share $.13 $.12 Common and common equivalent shares 292,741 298,511 See notes to consolidated financial statements.
Page 5 TOYS "R" US, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands)
13 Weeks Ended April 30, May 1, 1994 1993 Cash flows from operating activities: Net earnings $ 37,580 $ 35,436 Adjustments to reconcile net earnings to net cash used by operating activities: Depreciation and amortization 36,445 30,572 Deferred income taxes 4,926 4,987 Changes in operating assets and liabilities: Accounts and other receivables 5,622 (1,305) Merchandise inventories (248,157) (246,641) Prepaid expenses and other operating assets (20,622) 7,724 Accounts payable, accrued expenses and taxes (362,999) (238,917) Total adjustments (584,785) (443,580) Net cash used by operating activities (547,205) (408,144) Cash flows from investing activities: Capital expenditures-net (100,437) (64,891) Other assets (5,869) (9,675) Net cash used by investing activities (106,306) (74,566) Cash flows from financing activities: Short-term borrowings, net 170,594 25,630 Long-term borrowings 1,218 900 Long-term debt repayments (221) (236) Exercise of stock options 3,194 6,273 Share repurchase program (71,002) (53,109) Net cash provided (used) by financing activities 103,783 (20,542) Effect of exchange rate changes on cash and cash equivalents (3,976) 1,438 Cash and cash equivalents: Decrease during period (553,704) (501,814) Beginning of period 791,893 763,721 End of period $ 238,189 $ 261,907 P Supplemental disclosures of cash flow information: The Company considers all highly liquid investments purchased as part of its daily cash management activities to be cash equivalents. During the thirteen weeks ended April 30, 1994 and May 1, 1993, the Company made income tax payments of $154,727 and $144,995 and interest payments (net of amounts capitalized) of $18,896 and $16,185, respectively. See notes to consolidated financial statements.
Page 6 TOYS "R" US, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. Interim Reporting The interim financial statements are unaudited and are subject to year-end adjustments. However, in the opinion of management, all known adjustments (which consist only of normal recurring accruals) have been made to present fairly the consolidated operating results for the unaudited periods. Because of the seasonal nature of the Company's business, results for interim periods are not indicative of results to be expected for the fiscal year. 2. Earnings Per Share Earnings per share for the thirteen weeks ended April 30, 1994 and May 1, 1993 are computed by dividing net earnings by the weighted average number of common shares outstanding, after reduction for treasury shares and assuming exercise of dilutive stock options computed by the treasury stock method using the average market price during the period. Page 7 MANAGEMENT'S DISCUSSION - RESULTS OF OPERATIONS AND FINANCIAL CONDITION Results of Operations Sales increased by $175,454,000 or 13.6% in the first quarter over the prior year's comparable quarter due primarily to sales from 109 new toy stores and 10 children's clothing stores opened in 1993 and 1994, offset by the closing of 18 children's clothing stores over the same period. Comparable USA toy store sales increased by 6.6% for the quarter. International toy store comparable sales decreased due to adverse local economic conditions. Cost of sales as a percentage of sales decreased from 68.6% in the first quarter of 1993 to 68.5% in the first quarter of 1994 due to a more favorable product mix and reduced markdowns associated with strong inventory controls. Selling, advertising, general and administrative expenses remained constant at 24% of sales in the first quarter of 1994 and 1993. Net interest expense increased in the quarter compared to the prior years quarter, as a result of a decrease in interest income ($4,651,000 in 1994 and $6,823,000 in 1993) and higher average short term borrowings. Our effective tax rate increased from 36% in the first quarter of 1993 to 37% in the first quarter of 1994 due to a 1% increase in the U.S. federal corporate income tax rate. Financial Condition Plans are underway for approximately 40 U.S.A. and 65 international toy stores including our first stores in Denmark and Sweden, and 10 Kids "R" Us children's clothing stores. The Company has closed 14 of the 20 Kids "R" Us stores that were anticipated to be closed this year, with no significant impact on the Company's financial condition. Seasonal cash requirements will continue to be met through operations, the issuance of short-term commercial paper, bank borrowings for certain foreign subsidiaries and the issuance of long-term debt, if advantageous. Page 8 PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Not applicable. (b) The Company was not required to file any reports on Form 8-K during the 13 weeks ended April 30, 1994. Page 9 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. Date: June 6, 1994 Toys "R" Us, Inc. (Registrant) s/Louis Lipschitz (Signature) Louis Lipschitz Senior Vice President - Finance and Chief Financial Officer -----END PRIVACY-ENHANCED MESSAGE-----