-----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, BPKyDQOFf8kKIsvGaZAxTzjluC74PGT5uI3O2RFgFChSITevbNq5HkjrqpzBiM6c 8iYu+6etmu7wr5s0Yje9YA== 0000912057-95-003687.txt : 19950530 0000912057-95-003687.hdr.sgml : 19950530 ACCESSION NUMBER: 0000912057-95-003687 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950331 FILED AS OF DATE: 19950512 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: WESTERN BEEF INC /DE/ CENTRAL INDEX KEY: 0000081942 STANDARD INDUSTRIAL CLASSIFICATION: 5411 IRS NUMBER: 112042612 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-04485 FILM NUMBER: 95538290 BUSINESS ADDRESS: STREET 1: 47 05 METROPOLITAN AVE CITY: RIDGEWOOD STATE: NY ZIP: 11385 BUSINESS PHONE: 7188210011 FORMER COMPANY: FORMER CONFORMED NAME: QUAREX INDUSTRIES INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: RANCHERS PACKING CORP DATE OF NAME CHANGE: 19830713 10-Q 1 10-Q FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarter Ended March 31, 1995 -------------- Commission File Number 0-4485 ------ WESTERN BEEF, INC. - - - - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 13-3266114 - - - - ------------------------------- ------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization.) Identification No.) 47-05 Metropolitan Avenue, Ridgewood, New York 11385 - - - - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (718)417-3770 ------------- Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 12 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months 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. 5,463,317 SHARES OF COMMON STOCK, $.05 PAR VALUE AS OF MAY 5, 1995 INDEX WESTERN BEEF, INC. AND SUBSIDIARIES PAGE ---- PART I-FINANCIAL INFORMATION Item 1. Financial statements. Condensed consolidated balance sheets as of March 31, 1995 and December 30, 1994. 2 Condensed consolidated statements of income and retained earnings for the thirteen weeks ended March 31, 1995 and April 1, 1994. 3 Condensed consolidated statements of cash flows for the thirteen weeks ended March 31, 1995 and April 1, 1994. 4 Note to the condensed consolidated financial statements. 5 Item 2. Management's discussion and analysis of financial condition and results of operations. 6 PART II-OTHER INFORMATION 7 Item 1. Legal Proceedings Item 2. Changes in Securities Item 3. Defaults upon Senior Securities Item 4. Submission of Matters to a Vote of Security Holders Item 5. Other Information Item 6. Exhibits and Reports on Form 8-K SIGNATURES 8 WESTERN BEEF,INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except par value)
March 31, DECEMBER 30, 1995 1994 ----------- ------------ (Unaudited) Current assets: Cash and cash equivalents $ 3,744 $ 4,311 Accounts receivable, net of allowance for doubtful accounts ($272 and $142) 7,181 6,907 Inventories 13,967 13,339 Prepaid expenses and other current assets 2,254 2,390 Deferred income taxes 896 907 --------- --------- Total current assets 28,042 27,854 Property, plant and equipment, net of accumulated depreciation and amortization ($15,026 and $14,437) 26,959 25,276 Deferred income taxes 200 176 Other assets 921 887 --------- --------- Total assets $ 56,122 $ 54,193 --------- --------- --------- --------- LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Current portion of long-term debt $ 1,520 $ 1,563 Current portion of obligations under capital leases 103 101 Accounts payable 13,471 12,597 Accrued expenses and other liabilities 1,896 1,482 Income taxes payable 391 -- --------- --------- Total current liabilities 17,381 15,743 Long-term debt, net of current portion 5,300 5,779 Obligations under capital leases, net of current portion 1,418 1,445 --------- --------- Total liabilities 24,099 22,967 --------- --------- Shareholders' equity: Preferred stock, $.05 par value-shares authorized 2,000; none issued -- -- Common stock, $0.05 par value; 15,000,000 shares authorized; 5,463,317 shares issued and outstanding 273 273 Capital in excess of par value 11,516 11,516 Retained earnings 20,234 19,437 --------- --------- Total shareholders'equity 32,023 31,226 --------- --------- Total liabilities and shareholders'equity $ 56,122 $ 54,193 --------- --------- --------- ---------
See accompanying note to condensed consolidated financial statements. -2- WESTERN BEEF, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS (Unaudited) (In thousands, except per share data)
Thirteen Weeks Ended ----------------------------- March 31, 1995 April 1, 1994 -------------- ------------- Net sales $ 67,574 $ 71,088 Cost of sales 52,048 54,412 --------- --------- Gross profit on sales 15,526 16,676 --------- --------- Operating expenses: Rent expense-affiliates 698 596 Interest expense 195 183 Selling, general and administrative expenses 13,119 14,460 --------- --------- Total operating expenses 14,012 15,239 --------- --------- Income before income taxes 1,514 1,437 Provision for income taxes 717 625 --------- --------- Net income 797 812 Retained earnings -beginning of period 19,437 14,664 --------- --------- Retained earnings -end of period $ 20,234 $ 15,476 --------- --------- --------- --------- Weighted average number of common shares outstanding 5,463 $ 5,463 --------- --------- --------- --------- Earnings per common share $ .15 $ .15 --------- --------- --------- ---------
See accompanying note to condensed consolidated financial statements -3- WESTERN BEEF, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands)
Thirteen Weeks Ended ---------------------------------- March 31, 1995 April 1, 1994 -------------- ------------- Cash flows from operating activities: Net income $ 797 $ 812 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 596 679 Deferred income tax benefit (13) -- Provision for losses on accounts receivable 130 100 (Increase) decrease in assets: Accounts receivable (404) 477 Inventories (628) (866) Prepaid expenses and other current assets 136 107 Prepaid income taxes -- (54) Other assets (34) 12 (Decrease) increase in liabilities: Accounts payable 874 (777) Accrued expenses and other liabilities 414 799 Income taxes payable 391 -- Net cash provided by operating activities 2,259 1,289 ------- -------- Cash flows from investing activities: Capital expenditures (2,279) (633) ------- -------- Net cash used in investing activities (2,279) (633) ------- -------- Cash flows from financing activities: Net repayments under line of credit agreement -- (200) Payments on long-term debt and capital leases (547) (267) Payment of loans from affiliates and shareholders -- (349) Net cash used in financing activities (547) (816) ------- -------- Net decrease in cash and cash equivalents (567) (160) Cash and cash equivalents, beginning of period 4,311 1,080 ------- -------- Cash and cash equivalents, end of period $ 3,744 $ 920 ------- -------- ------- -------- Cash paid during the thirteen weeks for: Interest $ 195 $ 183 Income taxes $ 320 $ 680
See accompanying note to condensed consolidated financial statements -4- WESTERN BEEF, INC. AND SUBSIDIARIES NOTE TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS. (1) Basis of Presentation: The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting solely of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the thirteen weeks ended March 31, 1995 are not necessarily indicative of the results that may be expected for the year ending December 29, 1995. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's annual report on Form 10-K for the year ended December 30, 1994. -5- ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS: For the thirteen weeks ended March 31, 1995, Western Beef, Inc., ("the Company") achieved net income of $797,000 or $0.15 per share on net sales of $67,574,000, as compared to net income of $812,000, or $0.15 per share on net sales of $71,088,000 for the thirteen weeks ended April 1, 1994. Cost of sales, as a percentage of net sales, increased to 77% from 76.5% with a resultant decrease in the gross profit percentage to 23% from 23.5%. The decrease in sales, cost of sales and gross profits are mainly attributable to the decline in same store sales for the thirteen weeks ended March 31, 1995 as compared with the corresponding period in 1994. The Easter holiday which was celebrated in the first quarter of 1994 and which will be celebrated in the second quarter of 1995, accounted for almost 25% of the decline in sales. The balance of the decline results from competition from other supermarket chains. Selling, general and administrative expenses, including rent expense - affiliates, and interest expense, as a percentage of sales decreased to 20.7% for the thirteen weeks ended March 31, 1995 from 21.4% for the similar period in 1994 principally as a result of greater labor efficiency and lower insurance and utility costs. The success of the cost reduction and efficiency plans implemented during the past ten months is the principal reason for the decline. Although pre-tax income for the thirteen weeks ended March 31, 1995 was greater than that for the thirteen weeks ended April 1, 1994, net income was lower as a result of the termination of the Federal Targeted Jobs Credit program at the end of 1994. Liquidity and Capital Resources: Cash flows from operations were $2,259,000 for the thirteen weeks ended March 31, 1995 as compared to $1,289,000 for the comparable period of 1994. The increases in accounts receivable and inventory were more than offset by increases in accounts payable, accrued expenses and taxes payable. Cash flow from operations plus cash on hand were sufficient to pay for capital expenditures and long-term debt requirements. Most of the capital expenditures incurred were made in connection with the three new stores under construction. These stores are expected to be open by the end of June 1995. The Company believes that cash on hand and its $3,000,000 bank line of credit which expires on June 30, 1995 and which is expected to be renewed by the bank, will be sufficient to meet its operational needs and to fund the remaining costs to open the new stores. The Company also has several financial institutions that would be available to refinance new store equipment, usually over a five year period. -6- PART II OTHER INFORMATION Item 1. Legal Proceedings The Company has various outstanding litigation matters which it considers to be in the ordinary course of business. In the opinion of management, the outcome of these litigation matters will not materially, adversely affect the Company's financial position. In April 1991 in New York Supreme Court, Putnam County, an action was commenced against the Company to prevent a scheduled foreclosure of certain collateral held by the Company as security for its loan to one of the plaintiffs in the original principal amount of $85,000 of which approximately $65,000 was outstanding. Thereafter, in a complaint served in March 1992, plaintiffs interposed three causes of action on behalf of themselves and a previously unnamed plaintiff, C.B. Foods, Inc., which was owned by the plaintiffs and was a customer of the Company's wholesale business, seeking (1) a declaration that the loan had been repaid; (2) compensatory damages of $30,000,000 and exemplary damages of $10,000,000 for fraud allegedly committed by the Company; and (3) compensatory damages of $2,000,000 and exemplary damages of $10,000,000 for abuse of process allegedly committed by the Company. In its answer, the Company denied liability and all material allegations of the complaint. Following a motion by the Company, the court ordered plaintiffs' third cause of action for abuse of process dismissed for failure to state a claim and ordered all claims of C.B. Foods, Inc. struck from the complaint on the ground that it was not a party to the action. Plaintiffs have appealed the court's order. By order made on the record on January 19, 1994, the court dismissed the complaint for plaintiff's disobedience of prior court orders and their failure to prosecute their claims. Plaintiffs have moved to modify the January 19, 1994 order. If they are not successful, an appeal is anticipated, which the Company would vigorously defend. The Company believes the resolution of this matter will not adversely affect its financial position. Item 2. Changes in Securities None Item 3. Defaults upon Senior Securities None Item 4. Submission of Matters to a Vote of Security holders. None Item 5. Other Information None Item 6. Exhibits and Reports on Form 8-K The registrant has not filed a report on Form 8-K during the quarter just ended. -7- 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. WESTERN BEEF, INC. By: /s/Robert C. Ludlow -------------------- Robert C. Ludlow Treasurer and Chief Financial Officer (Principal Financial and Accounting Officer) DATE: May 9, 1995 -8- EX-27 2 EXHIBIT 27
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE WESTERN BEEF, INC. QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 3-MOS DEC-29-1995 DEC-31-1994 MAR-31-1995 3,744 0 7453 272 13967 28042 41985 15026 56122 17381 6718 273 0 0 31750 56122 67574 67574 52048 52048 13817 0 195 1514 717 797 0 0 0 797 .15 .15
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