8-K 1 march018k.txt FDS YEAR END 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: March 22, 2001 FEDERATED DEPARTMENT STORES, INC. 7 West Seventh Street, Cincinnati, Ohio 45202 (513) 579-7000 -and- 151 West 34th St., New York, New York 10001 (212) 494-1602 Delaware 1-13536 13-3324058 (State of Incorporation) (Commission File No.) (IRS Id. No.) Item 5. Other Events This Current Report on Form 8-K is being filed with the Securities and Exchange Commission by Federated Department Stores, Inc. ("Federated") for the purpose of filing, as exhibits hereto, the Unaudited Consolidated Statements of Operations and the Unaudited Operating Segment Data of Federated for the 14 weeks and 53 weeks ended February 3, 2001 and for the 13 weeks and 52 weeks ended January 29, 2000, the Unaudited Consolidated Balance Sheets of Federated as of February 3, 2001 and January 29, 2000 and the Unaudited Consolidated Statements of Cash Flows for Federated for the 53 weeks ended February 3, 2001 and for the 52 weeks ended January 29, 2000. The exhibits filed herewith should be read in conjunction with the consolidated financial statements, the notes thereto and the other information contained in Federated's Annual Report on Form 10-K for the fiscal year ended January 29, 2000. On December 7, 2000, Prime Receivables Corporation, a subsidiary of Federated, issued and sold $400,000,000 aggregate stated principal amount of 6.70% Class A Asset Backed Certificates, Series 2000-1. These certficiates represent undivided interests in the Prime Credit Card Master Trust and are expected to mature on November 15, 2005. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. The following exhibits are filed herewith: 99.1 Unaudited Consolidated Statements of Operations of Federated for the 14 weeks and 53 weeks ended February 3, 2001 and for the 13 weeks and 52 weeks ended January 29, 2000. 99.2 Unaudited Operating Segment Data of Federated for the 14 weeks and 53 weeks ended February 3, 2001 and for the 13 weeks and 52 weeks ended January 29, 2000. 99.3 Unaudited Consolidated Balance Sheets of Federated as of February 3, 2001 and January 29, 2000. 99.4 Unaudited Consolidated Statements of Cash Flows of Federated for the 53 weeks ended February 3, 2001 and for the 52 weeks ended January 29, 2000. 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. FEDERATED DEPARTMENT STORES, INC. Date: March 22, 2001 /s/ Dennis J. Broderick Dennis J. Broderick Senior Vice President, General Counsel and Secretary EXHIBIT INDEX Exhibit Number 99.1 Unaudited Consolidated Statements of Operations of Federated for the 14 weeks and 53 weeks ended February 3, 2001 and for the 13 weeks and 52 weeks ended January 29, 2000. 99.2 Unaudited Operating Segment Data of Federated for the 14 weeks and 53 weeks ended February 3, 2001 and for the 13 weeks and 52 weeks ended January 29, 2000. 99.3 Unaudited Consolidated Balance Sheets of Federated as of February 3, 2001 and January 29, 2000. 99.4 Unaudited Consolidated Statements of Cash Flows of Federated for the 53 weeks ended February 3, 2001 and for the 52 weeks ended January 29, 2000. Exhibit 99.1 FEDERATED DEPARTMENT STORES, INC. Consolidated Statements of Operations (Unaudited) (All amounts in millions except percentages and per share figures) 14 Weeks 13 Weeks 53 Weeks 52 Weeks Ended Ended Ended Ended February 3, January 29, February 3, January 29, 2001 2000 2001 2000 Net Sales $ 6,115 $ 5,973 $ 18,407 $ 17,716 Cost of Sales: Recurring (Note 1) 3,583 3,496 10,872 10,443 Inventory valuation adjustments related to Fingerhut restructuring - - 35 - Total cost of sales 3,583 3,496 10,907 10,443 Percent to sales 58.6% 58.5% 59.3% 58.9% Selling, general and administrative expenses 1,697 1,621 6,023 5,572 Percent to sales 27.8% 27.1% 32.7% 31.5% Asset impairment and restructuring charges (Note 2) 167 - 927 - Percent to sales 2.7% -% 5.0% -% Operating Income 668 856 550 1,701 Percent to sales 10.9% 14.4% 3.0% 9.6% Interest expense - net (119) (104) (437) (355) Income Before Income Taxes 549 752 113 1,346 Federal, state and local income tax expense (217) (304) (297) (551) Net Income (Loss) $ 332 $ 448 $ (184) $ 795 Basic Earnings (Loss) per share (Note 3) $ 1.67 $ 2.11 $ (.90) $ 3.78 Diluted Earnings (Loss) per share (Note 3) $ 1.65 $ 2.04 $ (.90) $ 3.62 Analytical Diluted Earnings per share (Notes 3 and 4) $ 2.15 $ 2.04 $ 3.08 $ 3.62 Notes: (1) Substantially all department store merchandise inventories are valued by the retail method and stated on the LIFO (last-in, first- out) basis, which is generally lower than market. Application of this method did not impact cost of sales for the 14 and 53 weeks ended February 3, 2001 or the 13 and 52 weeks ended January 29, 2000. Direct-to-customer merchandise inventories are stated at the lower of FIFO (first-in, first-out) cost or market. (2) Asset impairment and restructuring charges for the 14 weeks ended February 3, 2001 represent the write-down of certain Fingerhut Internet-related and other venture capital investments totaling $71 million, severance costs, facility closing costs and asset write- downs related to the downsizing of Fingerhut operations totaling $42 million and asset write-downs related to the closure of the Stern's department store division and the planned disposition of certain of its properties totaling $54 million. Asset impairment and restructuring charges for the 53 weeks ended February 3, 2001 represent the write-down of intangible assets related to the Fingerhut acquisition totaling $673 million, the write-down of certain Fingerhut Internet-related and other venture capital investments totaling $131 million, the write-down of Fingerhut fixed assets totaling $18 million, severance costs, facility closing costs and asset write-downs related to the downsizing of Fingerhut operations totaling $51 million and asset write-downs related to the closure of the Stern's department store division and the planned disposition of certain of its properties totaling $54 million. (3) Common shares outstanding used in computing basic earnings (loss) per share were 198.7 million and 212.3 million for the 14 weeks ended February 3, 2001 and the 13 weeks ended January 29, 2000, respectively, and 204.8 million and 210.4 million for the 53 weeks ended February 3, 2001 and the 52 weeks ended January 29, 2000, respectively. Potential common shares used in computing diluted earnings (loss) per share were 201.6 million and 219.9 million for the 14 weeks ended February 3, 2001 and the 13 weeks ended January 29, 2000, respectively, and 204.8 million (207.0 million on an analytical basis) and 219.6 million for the 53 weeks ended February 3, 2001 and the 52 weeks ended January 29, 2000, respectively. (4) Excludes the impact of inventory valuation adjustments related to the Fingerhut restructuring and the asset impairment and restructuring charges (see Note 2). Exhibit 99.2 FEDERATED DEPARTMENT STORES, INC. Operating Segment Data (Unaudited) (millions) 14 Weeks 13 Weeks 53 Weeks 52 Weeks Ended Ended Ended Ended February 3, January 29, February 3, January 29, 2001 2000 2001 2000 Net Sales Department Stores $ 5,540 $ 5,198 $ 16,467 $ 15,850 Direct-to-Customer 575 775 1,940 1,866 Total $ 6,115 $ 5,973 $ 18,407 $ 17,716 Operating income Department Stores: Recurring $ 939 $ 872 $ 2,004 $ 1,871 Asset impairment and restructuring charges (Note 1) (54) - (54) - Total Department Stores 885 872 1,950 1,871 Direct-to-Customer: Recurring (6) 55 (288) 51 Asset impairment and restructuring charges (Note 2) (42) - (104) - Total Direct-to-Customer (48) 55 (392) 51 Corporate and other: Recurring (Note 3) (98) (71) (204) (221) Asset impairment and restructuring charges (Note 4) (71) - (804) - Total corporate and other (169) (71) (1,008) (221) Total $ 668 $ 856 $ 550 $ 1,701 Depreciation and amortization expense Department Stores $ 155 $ 158 $ 606 $ 619 Direct-to-Customer 11 5 44 33 Corporate and other (Note 2) 14 24 83 86 Total $ 180 $ 187 $ 733 $ 738 Notes: (1) Asset impairment and restructuring charges in the Department Store segment represent asset write-downs related to the closure of the Stern's department store division and the planned disposition of certain of its properties totaling $54 million. (2) Asset impairment and restructuring charges for the 14 weeks ended February 3, 2001 in the Direct-to-customer segment represent severance costs, facility closing costs and asset write-downs related to the downsizing of Fingerhut operations totaling $42 million. Asset impairment and restructuring charges for the 53 weeks ended February 3, 2001 in the Direct-to-customer segment represent the write-down of fixed assets totaling $18 million and other restructuring charges totaling $86 million, consisting of severance costs, facility closing costs and asset write-downs related to the downsizing of Fingerhut operations totaling $51 million and $35 million of inventory valuation adjustments related to the Fingerhut restructuring. (3) Corporate and other consists of the income or expense associated with the corporate office and certain items managed on a company-wide basis (e.g. intangibles, financial instruments, investments, retirement benefits and properties held for sale or disposition). (4) Asset impairment and restructuring charges for the 14 weeks ended February 3, 2001 in the Corporate and other segment represent the write-down of certain Fingerhut Internet-related and other venture capital investments totaling $71 million. Asset impairment and restructuring charges for the 53 weeks ended February 3, 2001 in the Corporate and other segment represent the write-down of intangible assets related to the Fingerhut acquisition totaling $673 million and the write down of certain Fingerhut Internet-related and other venture capital investments totaling $131 million. Exhibit 99.3 FEDERATED DEPARTMENT STORES, INC. Consolidated Balance Sheets (Unaudited) (millions) February 3, 2001 January 29, 2000 ASSETS: Current Assets: Cash $ 322 $ 218 Accounts receivable (Note 1) 4,072 4,313 Merchandise inventories 3,812 3,589 Supplies and prepaid expenses 200 230 Deferred income tax assets 294 172 Total Current Assets 8,700 8,522 Property and Equipment - net 6,830 6,828 Intangible Assets - net 896 1,735 Other Assets 586 607 Total Assets $17,012 $17,692 LIABILITIES AND SHAREHOLDERS' EQUITY: Current Liabilities: Short-term debt $ 1,722 $ 1,284 Accounts payable and accrued liabilities 2,903 3,043 Income taxes 244 225 Total Current Liabilities 4,869 4,552 Long-Term Debt 4,374 4,589 Deferred Income Taxes 1,393 1,444 Other Liabilities 554 555 Shareholders' Equity 5,822 6,552 Total Liabilities and Shareholders' Equity $ 17,012 $ 17,692 Note: 1. Consists of $1,637 million of Fingerhut accounts receivable, net of $584 million of allowance for doubtful accounts and $2,435 million of other Federated accounts receivable, net of $71 million of allowance for doubtful accounts as of February 3, 2001; and $1,978 million of Fingerhut accounts receivable, net of $295 million of allowance for doubtful accounts and $2,335 million of other Federated accounts receivable, net of $63 million of allowance for doubtful accounts as of January 29, 2000. Exhibit 99.4 FEDERATED DEPARTMENT STORES, INC. Consolidated Statements of Cash Flows (Unaudited) (millions) 53 Weeks Ended 52 Weeks Ended February 3, 2001 January 29, 2000 Cash flows from operating activities: Net income (loss) $ (184) $ 795 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 653 657 Amortization of intangible assets 74 78 Amortization of financing costs 7 7 Amortization of unearned restricted stock 6 3 Asset impairment and restructuring charges 962 - Changes in assets and liabilities: (Increase) decrease in accounts receivable 225 (473) Increase in merchandise inventories (256) (164) (Increase) decrease in supplies and prepaid expenses 30 (27) Increase in other assets not separately identified (17) (8) Increase (decrease) in accounts payable and accrued liabilities not separately identified (154) 194 Increase in current income taxes 22 128 Increase (decrease) in deferred income taxes (77) 64 Increase (decrease) in other liabilities not separately identified (6) 9 Net cash provided by operating activities 1,285 1,263 Cash flows from investing activities: Purchase of property and equipment (742) (770) Capitalized software (100) (52) Investments in companies (34) (117) Acquisition of Fingerhut Companies, Inc., net of cash acquired - (1,539) Disposition of property and equipment 72 46 Net cash used by investing activities (804) (2,432) Cash flows from financing activities: Debt issued 750 1,684 Financing costs (6) (10) Debt repaid (528) (650) Increase (decrease) in outstanding checks (43) 33 Acquisition of treasury stock (603) (267) Issuance of common stock 53 290 Net cash provided (used) by financing activities (377) 1,080 Net increase (decrease) in cash 104 (89) Cash beginning of period 218 307 Cash end of period $ 322 $ 218