8-K 1 l03145ae8vk.txt COLE NATIONAL CORPORATION | FORM 8-K UNITED STATES 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): September 23, 2003 (September 15, 2003) COLE NATIONAL CORPORATION (Exact Name of Registrant as Specified in Charter) DELAWARE 1-12814 34-1453189 (State or Other Jurisdiction (Commission (IRS Employer of Incorporation) File Number) Identification No.) 1925 ENTERPRISE PARKWAY TWINSBURG, OHIO 44087 (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (330) 486-3100 Not Applicable (Former Name or Former Address, if Changed Since Last Report) ITEM 5. OTHER EVENTS AND REGULATION FD DISCLOSURE. In the Company's most recent Form 10-Q for the quarter ended August 2, 2003, filed on September 15, 2003, managed care claims expense was reclassified to cost of revenues from operating expenses for all periods presented to provide improved transparency to Cole Vision's gross margin. The following tables present the Company's consolidated statements of operations and its results of operations for each quarter of fiscal 2002 and the first quarter of fiscal 2003 adjusted to reflect the reclassification of managed care claims expense to cost of revenues as well as certain other reclassifications to conform those periods to the current quarter's presentation. These tables should be read in conjunction with the condensed consolidated financial statements included in the Company's most recent Form 10-Q and the consolidated financial statements and related notes included in the Company's Annual Report on Form 10-K for the fiscal year ended February 1, 2003.
CONSOLIDATED STATEMENTS OF OPERATIONS ------------------------------------- (Dollars in thousands, except per share amounts) FISCAL 2002 ----------------------------------------------------------------------- FISCAL 2003 FIRST SECOND THIRD FOURTH FULL FIRST QUARTER QUARTER QUARTER QUARTER YEAR QUARTER ----------- ----------- ----------- ----------- ----------- ----------- Net revenue $ 285,441 $ 292,390 $ 275,501 $ 294,787 $ 1,148,119 $ 288,249 Costs and expenses: Cost of revenues 100,007 103,020 97,511 108,437 408,975 105,913 Operating expenses 177,056 179,500 178,446 177,145 712,147 184,867 ----------- ----------- ----------- ----------- ----------- ----------- Total costs and expenses 277,063 282,520 275,957 285,582 1,121,122 290,780 ----------- ----------- ----------- ----------- ----------- ----------- Operating income (loss) 8,378 9,870 (456) 9,205 26,997 (2,531) Interest and other (income) expense, net: Interest expense 7,100 6,784 6,501 6,450 26,835 6,388 Interest and other income, net (1,611) (2,098) (536) (2,581) (6,826) (907) Loss on early extinguishment of debt -- 11,141 -- -- 11,141 -- ----------- ----------- ----------- ----------- ----------- ----------- Total interest and other (income) expense, net 5,489 15,827 5,965 3,869 31,150 5,481 ----------- ----------- ----------- ----------- ----------- ----------- Income (loss) before income taxes 2,889 (5,957) (6,421) 5,336 (4,153) (8,012) Income tax provision (benefit) 2,023 (271) (4,494) 3,738 996 (1,601) ----------- ----------- ----------- ----------- ----------- ----------- Net income (loss) $ 866 $ (5,686) $ (1,927) $ 1,598 $ (5,149) $ (6,411) =========== =========== =========== =========== =========== =========== Earnings (loss) per common share: Basic $ 0.05 $ (0.35) $ (0.12) $ 0.10 $ (0.32) $ (0.39) Diluted $ 0.05 $ (0.35) $ (0.12) $ 0.10 $ (0.32) $ (0.39) Weighted avaerage shares: Basic 16,128 16,212 16,276 16,277 16,223 16,304 Diluted 16,588 16,212 16,276 16,466 16,223 16,304
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RESULTS OF OPERATIONS (Dollars in millions) FISCAL 2002 ---------------------------------------------------------------------- FISCAL 2003 FIRST SECOND THIRD FOURTH FULL FIRST QUARTER QUARTER QUARTER QUARTER YEAR QUARTER ---------------------------------------------------------------------- -------- Net revenue: Cole Vision $ 232.9 $ 218.1 $ 221.8 $ 204.7 $ 877.5 $ 233.5 Things Remembered 52.5 74.3 53.7 90.1 270.6 54.7 ---------------------------------------------------------------------- -------- Total net revenue $ 285.4 $ 292.4 $ 275.5 $ 294.8 $ 1,148.1 $ 288.2 Gross margin: Cole Vision $ 146.8 $ 135.7 $ 138.4 $ 126.1 $ 547.0 $ 142.7 Things Remembered 38.6 53.7 39.6 60.2 192.1 39.7 ---------------------------------------------------------------------- -------- Total gross margin $ 185.4 $ 189.4 $ 178.0 $ 186.3 $ 739.1 $ 182.4 Operating expenses: Cole Vision $ 133.5 $ 132.8 $ 132.3 $ 117.8 $ 516.4 $ 133.5 Things Remembered 40.4 43.9 42.3 50.4 177.0 42.2 Unallocated corporate expenses 3.1 2.8 3.9 8.9 18.7 9.2 ---------------------------------------------------------------------- -------- Total operating expenses $ 177.0 $ 179.5 $ 178.5 $ 177.1 $ 712.1 $ 184.9 Operating income (loss): Cole Vision $ 13.3 $ 2.9 $ 6.1 $ 8.3 $ 30.6 $ 9.2 Things Remembered (1.8) 9.8 (2.7) 9.8 15.1 (2.5) Unallocated corporate expenses (3.1) (2.8) (3.9) (8.9) (18.7) (9.2) ---------------------------------------------------------------------- -------- Total operating income (loss) $ 8.4 $ 9.9 $ (0.5) $ 9.2 $ 27.0 $ (2.5) ====================================================================== ======== Percentage of net revenue: Gross margin 65.0% 64.8% 64.6% 63.2% 64.4% 63.3% Operating expenses 62.0% 61.4% 64.8% 60.1% 62.0% 64.1% Operating income (loss) 2.9% 3.4% (0.2)% 3.1% 2.4% (0.9)%
2 SIGNATURE 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. COLE NATIONAL CORPORATION By: /s/ Lawrence E. Hyatt ----------------------------------- Name: Lawrence E. Hyatt Title: Executive Vice President and Chief Financial Officer Date: September 23, 2003 3