-----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, B1fWUi0YOvGTZXR3nXon2wU68aRh2IcDRxsr5uGQGtRlfqIcBOloExAnaDCs1BdA gaXtk4BRURm85+T8EPQlIg== 0000887124-99-000008.txt : 19990616 0000887124-99-000008.hdr.sgml : 19990616 ACCESSION NUMBER: 0000887124-99-000008 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990501 FILED AS OF DATE: 19990615 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NINE WEST GROUP INC /DE CENTRAL INDEX KEY: 0000887124 STANDARD INDUSTRIAL CLASSIFICATION: FOOTWEAR, (NO RUBBER) [3140] IRS NUMBER: 061093855 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-11161 FILM NUMBER: 99646323 BUSINESS ADDRESS: STREET 1: NINE WEST PLAZA STREET 2: 1129 WESTCHESTER AVE CITY: WHITE PLAINS STATE: NY ZIP: 10604 BUSINESS PHONE: 3145798812 MAIL ADDRESS: STREET 1: NINE WEST PLAZA STREET 2: 1129 WESTCHESTER AVENUE CITY: WHITE PLAINS STATE: NY ZIP: 10604 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the thirteen weeks ended May 1, 1999 Commission File No. 1-11161 Nine West Group Inc. (Exact name of Registrant as specified in its charter) Delaware 06-1093855 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) Nine West Plaza 1129 Westchester Avenue White Plains, New York 10604 (Address of principal executive offices) (Zip Code) (314) 579-8812 (Registrant's telephone number, including area code) 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 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 Number of shares of Common Stock, $.01 par value, outstanding as of the close of business on May 1, 1999: 34,079,913. TABLE OF CONTENTS PART I - FINANCIAL INFORMATION Page ---- Item 1 Condensed Consolidated Financial Statements (Unaudited) Condensed Consolidated Statements of Income - 13 weeks ended May 1, 1999 and May 2, 1998 3 Condensed Consolidated Balance Sheets - May 1, 1999 and January 30, 1999 4 Condensed Consolidated Statements of Cash Flows - 13 weeks ended May 1, 1999 and May 2, 1998 5 Notes to Condensed Consolidated Financial Statements 6 Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations 14 Item 3 Quantitative and Qualitative Disclosures About Market Risk 19 PART II - OTHER INFORMATION Item 1 Legal Proceedings 20 Item 6 Exhibits and Reports on Form 8-K 20 Signatures 22 Index to Exhibits 23
NINE WEST GROUP INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (in thousands except per share data) (Unaudited) 13 Weeks Ended ---------------------- May 1 May 2 1999 1998 -------- -------- Net revenues......................................... $441,867 $448,282 Cost of goods sold................................... 245,409 257,222 -------- -------- Gross profit....................................... 196,458 191,060 Selling, general and administrative expenses............................. 165,805 161,799 Amortization of acquisition goodwill and other intangibles............................... 2,708 2,522 -------- -------- Operating income................................... 27,945 26,739 Interest expense..................................... 12,203 14,799 -------- -------- Income before income taxes......................... 15,742 11,940 Income tax expense................................... 6,139 4,657 -------- -------- Net income......................................... $ 9,603 $ 7,283 ======== ======== Weighted average common shares: Basic.............................................. 33,996 35,916 ======== ======== Diluted............................................ 34,037 35,962 ======== ======== Earnings per share: Basic.............................................. $ 0.28 $ 0.20 ======== ======== Diluted............................................ $ 0.28 $ 0.20 ======== ======== The accompanying Notes are an integral part of the Condensed Consolidated Financial Statements
NINE WEST GROUP INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands except share data) (Unaudited) May 1 January 30 1999 1999 ---------- ---------- ASSETS Current Assets: Cash.............................................. $ 29,637 $ 17,951 Accounts receivable including securitized interest in accounts receivable - net............ 90,416 86,494 Inventories....................................... 423,457 460,375 Prepaid expenses and other current assets......... 65,932 67,432 ---------- ---------- Total current assets............................ 609,442 632,252 Property and equipment - net........................ 161,887 164,006 Goodwill - net...................................... 228,621 230,237 Trademarks and trade names - net.................... 136,793 137,895 Other assets........................................ 51,579 52,739 ---------- ---------- Total assets.................................. $1,188,322 $1,217,129 ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable.................................. $ 73,666 $ 79,525 Accrued expenses and other current liabilities.... 85,510 99,067 Current portion of long-term debt................. 3,925 3,449 ---------- ---------- Total current liabilities....................... 163,101 182,041 Long-term debt...................................... 486,756 510,804 Other non-current liabilities....................... 67,458 66,220 ---------- ---------- Total liabilities............................. 717,315 759,065 ---------- ---------- Stockholders' Equity: Preferred stock ($0.01 par value, 25,000,000 shares authorized; none issued and outstanding).. - - Common stock ($0.01 par value, 100,000,000 shares authorized; 34,079,913 and 33,985,098 shares issued and outstanding, respectively)............ 360 359 Additional paid-in capital........................ 146,772 144,203 Retained earnings................................. 347,889 338,286 Accumulated other comprehensive income............ (4,023) (4,793) ---------- ---------- 490,998 478,055 Less treasury stock, at cost (1,952,900 shares). (19,991) (19,991) ---------- ---------- Total stockholders' equity.................... 471,007 458,064 ---------- ---------- Total liabilities and stockholders' equity.. $1,188,322 $1,217,129 ========== ========== The accompanying Notes are an integral part of the Condensed Consolidated Financial Statements
NINE WEST GROUP INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (Unaudited) 13 Weeks Ended ---------------------- May 1 May 2 1999 1998 ---------- ---------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income............................................ $ 9,603 $ 7,283 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization...................... 12,053 12,110 Deferred income taxes and other.................... 4,519 8,600 Changes in assets and liabilities: Accounts receivable including securitized interest in accounts receivable - net.......... (3,922) 18,082 Inventories..................................... 36,918 (4,502) Prepaid expenses and other assets............... (2,148) 11,052 Accounts payable................................ (5,859) (16,504) Accrued expenses and other liabilities.......... (12,319) (14,525) -------- -------- Net cash provided by operating activities............. 38,845 21,596 -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment................... (7,383) (7,361) Proceeds from sale of property and equipment.......... - 16,351 Business acquisition - net of cash acquired........... - (9,025) Other investing activities............................ 839 (53) -------- -------- Net cash used by investing activities................. (6,544) (88) -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES: Net repayments under financing agreements............. (23,955) (23,761) Net proceeds from issuance of stock and other......... 3,340 1,094 -------- -------- Net cash used by financing activities................. (20,615) (22,667) -------- -------- NET INCREASE (DECREASE)IN CASH........................ 11,686 (1,159) CASH, BEGINNING OF PERIOD............................. 17,951 23,674 -------- -------- CASH, END OF PERIOD................................... $ 29,637 $ 22,515 ======== ======== The accompanying Notes are an integral part of the Condensed Consolidated Financial Statements
NINE WEST GROUP INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. BASIS OF PRESENTATION The condensed consolidated financial statements include the accounts of Nine West Group Inc. (the "Company"), its wholly-owned subsidiaries and its controlled-interest joint ventures. The accompanying financial statements have been prepared in accordance with generally accepted accounting principles. In the opinion of management, such information contains all adjustments necessary for a fair presentation of the results of such periods. Certain prior year amounts have been reclassified to conform to the current presentation. All intercompany transactions and balances have been eliminated from the condensed consolidated financial statements for the periods presented. The results of operations for the 13 weeks ended May 1, 1999 are not necessarily indicative of the results to be expected for the 52 weeks ending January 29, 2000 ("1999"). Certain information and disclosures normally included in the notes to consolidated financial statements have been condensed or omitted as permitted by the rules and regulations of the Securities and Exchange Commission, although the Company believes the disclosure is adequate to make the information presented not misleading. The accompanying unaudited financial statements should be read in conjunction with the financial statements contained in the Company's Annual Report on Form 10-K for the 52 weeks ended January 30, 1999 ("1998"). 2. BUSINESS RESTRUCTURING CHARGE In the fourth quarter of 1998, the Company recorded a pre-tax charge of $18.0 million (the "1998 Restructuring Charge") related to the restructuring of the Company's manufacturing operations and the Company's decision to close its 9 & Co. retail stores. Inventory write-downs of $5.4 million associated with the charge were recorded as a component of costs of goods sold. The 1998 Restructuring Charge related to costs associated with: (1) the closure of one domestic manufacturing facility and one Caribbean-based component facility, and the reconfiguration and integration of certain operations at three other domestic manufacturing facilities (the "Manufacturing Restructuring"); and (2) the Company's decision to close all 63 9 & Co. stores in operation at January 30, 1999. The major components of the 1998 Restructuring Charge were: (1) asset write-downs of $12.9 million; (2) lease termination and facility closure costs of $3.5 million; and (3) severance and termination benefit costs of $1.6 million. Total cash outlays related to the 1998 Restructuring Charge are estimated to be $5.1 million and are to be substantially paid through 2000, with certain lease termination costs to be paid through 2002. During the fourth quarter of 1998, the Company substantially completed the activities associated with the Manufacturing Restructuring. During the first quarter of 1999, the Company closed 12 of the 9 & Co. stores. The Company anticipates that it will close approximately 50 of the 63 9 & Co. stores during 1999, and close the remaining 9 & Co. stores during 2000. As of May 1, 1999, charges against the 1998 Restructuring Charge accrual related to these actions included $12.9 million in asset write-downs, $0.5 million in severance and termination benefit payments ($0.3 million during the first quarter of 1999) and $0.4 million in lease termination and facility closure costs (all during the first quarter of 1999). The remaining balance of the 1998 Restructuring Charge accrual of $4.2 million is recorded in the balance sheet within the captions "Accrued expenses and other current liabilities" ($3.6 million) and "Other non- current liabilities" ($0.6 million) and consists primarily of cash outlays related to lease termination and facility closure costs ($3.1 million) and severance and termination benefits costs ($1.1 million). The initiatives outlined in the 1998 Restructuring Charge are expected to affect approximately 1,260 employees, of which 640 are manufacturing positions, 580 are 9 & Co. retail employees and 40 are managerial employees. Total severance and termination benefit costs associated with these initiatives are estimated to be $2.9 million, of which $1.6 million was included in the 1998 Restructuring Charge and $0.8 million was related to benefits provided by the Company's existing severance plans. The remaining $0.5 million is related to the 9 & Co. store closures. As of May 1, 1999, substantially all of the manufacturing and managerial and 41 of the 9 & Co. position eliminations were completed with $0.4 million in severance and termination benefit costs being charged against the existing severance plan liability. The severance and termination benefit payments associated with the 1998 Restructuring Charge will be substantially completed during 1999. 3. EARNINGS PER SHARE Following is a reconciliation of the earnings and shares used in the basic and diluted per share computations for net income (in thousands): 13 Weeks Ended ---------------------- May 1 May 2 1999 1998 -------- -------- Earnings: Income before extraordinary item (numerator for basic and diluted calculation).............................. $ 9,603 $ 7,283 ======= ======= Shares: Weighted average common shares outstanding (denominator for basic calculation)........................ 33,996 35,916 Effect of stock options..................... 41 46 ------- ------- Denominator for diluted calculation................................ 34,037 35,962 ======= ======= Earnings per share: Basic....................................... $ 0.28 $ 0.20 ======= ======= Diluted..................................... $ 0.28 $ 0.20 ======= ======= The impact of the convertible notes was excluded from the diluted earnings per share calculation for the 13 weeks ended May 1, 1999 and May 2, 1998 as its effect on the reported per share amounts was anti-dilutive. For the 13 weeks ended May 1, 1999 and May 2, 1998, certain outstanding stock options were not included in the computation of diluted earnings per share, because the respective exercise prices were greater than the average market price of the Common Stock. For the 13 weeks ended May 1, 1999 and May 2, 1998, the number of stock options whose impact was not included in the diluted computation was 5.3 million and 4.3 million, respectively. These options were outstanding at the end of each of the respective periods. 4. COMPREHENSIVE INCOME Comprehensive income, net of taxes, is comprised of (in thousands): 13 Weeks Ended ---------------------- May 1 May 2 1999 1998 -------- -------- Net income................................... $ 9,603 $7,283 Currency translation adjustment.............. 770 485 -------- -------- Comprehensive income.................... $10,373 $7,768 ======== ======== 5. ACCOUNTS RECEIVABLE INCLUDING SECURITIZED INTEREST IN ACCOUNTS RECEIVABLE - NET Accounts receivable including securitized interest in accounts receivable consists of (in thousands): May 1 January 30 1999 1999 ------- ---------- Securitized interest in accounts receivable.. $93,946 $85,957 Accounts receivable.......................... 46,696 51,153 Allowance for doubtful accounts and other allowances................................. (50,226) (50,616) ------- -------- Accounts receivable including securitized interest in accounts receivable - net.. $90,416 $86,494 ======= ======== 6. INVENTORIES Inventories are valued at the lower of cost or market. Approximately 53% and 57% of inventory values were determined by using the FIFO (first in, first out) method of valuation as of May 1, 1999 and January 30, 1999, respectively; the remainder was determined by using the weighted average cost method. Inventories are comprised of (in thousands): May 1 January 30 1999 1999 -------- ---------- Raw materials................................ $ 15,860 $ 16,967 Work in process.............................. 1,191 1,403 Finished goods............................... 406,406 442,005 -------- -------- Total inventories....................... $423,457 $460,375 ======== ======== 7. LONG-TERM DEBT The Company is permitted to borrow up to $500.0 million under the terms of its revolving credit facility, of which up to $150.0 million may be utilized for letters of credit and up to $250.0 million may be in the form of multicurrency borrowings. As of May 1, 1999, $14.6 million of multicurrency borrowings backed by letters of credit and $45.6 million of other letters of credit were outstanding on a revolving basis, and $439.8 million was available for future borrowing. 8. CASH FLOWS Cash paid for income taxes was $0.1 million for the 13 weeks ended May 1, 1999. The Company received income tax refunds of $0.2 million during the 13 weeks ended May 2, 1998. Cash paid for interest was $15.2 million and $21.9 million for the 13 weeks ended May 1, 1999 and May 2, 1998, respectively. 9. BUSINESS SEGMENT AND GEOGRAPHIC AREA INFORMATION The Company's operations are comprised of domestic wholesale, domestic retail and international segments. Information on segments and a reconciliation to amounts disclosed within the condensed consolidated financial statements are as follows (in thousands):
Quarter ended May 1, 1999: Domestic Domestic Inter- Corporate Wholesale Retail national and other Consolidated --------- -------- -------- --------- ------------ Net revenues........... $205,126 $164,694 $72,047 $ - $441,867 Segment profit......... 44,307 11,193 626 (28,181) 27,945 Interest expense....... 12,203 Income before income taxes................. 15,742 Quarter ended May 2, 1998: Domestic Domestic Inter- Corporate Wholesale Retail national and other Consolidated --------- -------- -------- --------- ------------ Net revenues........... $210,384 $170,370 $67,528 $ - $448,282 Segment profit......... 38,559 11,538 2,969 (26,327) 26,739 Interest expense....... 14,799 Income before income taxes................. 11,940 Total assets are as follows: May 1 January 30 1999 1999 ---------- ---------- Domestic wholesale...................................... $ 549,184 $ 508,532 Domestic retail......................................... 253,021 245,593 International........................................... 166,773 159,059 Corporate and other..................................... 219,344 303,945 ---------- ---------- Consolidated... ........................................ $1,188,322 $1,217,129 ========== ==========
10. MERGER AGREEMENT The Company, Jones Apparel Group, Inc. ("Jones"), a Pennsylvania corporation, and Jill Acquisition Sub Inc. ("Merger Sub"), a Delaware corporation and a wholly owned subsidiary of Jones, have entered into an Agreement and Plan of Merger, dated as of March 1, 1999 (the "Merger Agreement"), pursuant to which the Company will be merged with Merger Sub (the "Merger") and all outstanding shares of the Company's Common Stock, other than shares held by parties to the Merger Agreement or by dissenting shareholders who perfect their statutory appraisal rights under Delaware law, will be converted into the right to receive $13.00 in cash and .5011 shares of common stock of Jones (the "Jones Common Stock"), subject to the terms and conditions of the Merger Agreement. Based on an average daily closing price of Jones Common Stock over a valuation period consisting of the 15 trading days preceding June 14, 1999 of $31.21 per share, and including assumed debt, the transaction has a total value of approximately $1.5 billion. Jones is a designer and marketer of a broad array of products, including sportswear, jeanswear, suits and dresses. On June 14, 1999, the Company stockholders approved the adoption of the Merger Agreement. The Merger is expected to close on June 15, 1999. 11. CONDENSED CONSOLIDATING FINANCIAL INFORMATION Certain of the Company's debt is fully and unconditionally guaranteed on a joint and several basis by certain wholly-owned domestic subsidiaries of the Company. Accordingly, condensed consolidating balance sheets as of May 1, 1999 and January 30, 1999, and condensed consolidating statements of income and cash flows for the 13-week periods ended May 1, 1999 and May 2, 1998, respectively, for such guarantor subsidiaries are provided. These condensed consolidating financial statements have been prepared using the equity method of accounting in accordance with the requirements for presentation of such information. Separate financial statements and other disclosures concerning the guarantor subsidiaries are not presented because management has determined that they are not material to investors. There are no contractual restrictions on distributions from each of the guarantor subsidiaries to the Company. 11. CONDENSED CONSOLIDATING FINANCIAL INFORMATION Certain of the Company's debt is fully and unconditionally guaranteed on a joint and several basis by certain wholly-owned domestic subsidiaries of the Company. Accordingly, condensed consolidating balance sheets as of May 1, 1999 and January 30, 1999, and condensed consolidating statements of income and cash flows for the 13-week periods ended May 1, 1999 and May 2, 1998, respectively, for such guarantor subsidiaries are provided. These condensed consolidating financial statements have been prepared using the equity method of accounting in accordance with the requirements for presentation of such information. Separate financial statements and other disclosures concerning the guarantor subsidiaries are not presented because management has determined that they are not material to investors. There are no contractual restrictions on distributions from each of the guarantor subsidiaries to the Company.
CONDENSED CONSOLIDATING STATEMENTS OF INCOME 13 WEEKS ENDED MAY 1, 1999 (in thousands) Nine West Group Guarantor Non-Guarantor Elimination Inc. Subsidiaries Subsidiaries Entries Consolidated --------- ------------ ------------- ----------- ------------ Net revenues......................... $213,025 $499,218 $74,937 $(345,313) $441,867 Cost of goods sold................... 108,703 410,058 37,258 (310,610) 245,409 -------- -------- ------- --------- -------- Gross profit....................... 104,322 89,160 37,679 (34,703) 196,458 Selling, general and administrative expenses............. 100,440 66,467 33,601 (34,703) 165,805 Amortization of acquisition goodwill and other intangibles............... 1,413 929 366 - 2,708 -------- -------- ------- --------- -------- Operating income................... 2,469 21,764 3,712 - 27,945 Interest expense..................... 3,355 6,957 1,891 - 12,203 Equity in net earnings of subsidiaries........................ 10,748 - - (10,748) - -------- -------- ------- --------- -------- Income before income taxes......... 9,862 14,807 1,821 (10,748) 15,742 Income tax expense................... 259 5,457 423 - 6,139 -------- -------- ------- --------- -------- Net income......................... $ 9,603 $ 9,350 $ 1,398 $ (10,748) $ 9,603 ======== ======== ======= ========= ========
CONDENSED CONSOLIDATING STATEMENTS OF INCOME 13 WEEKS ENDED MAY 2, 1998 (in thousands) Nine West Group Guarantor Non-Guarantor Elimination Inc. Subsidiaries Subsidiaries Entries Consolidated -------- ------------ ------------- ----------- ------------ Net revenues......................... $209,130 $649,522 $77,663 $(488,033) $448,282 Cost of goods sold................... 109,087 558,753 39,491 (450,109) 257,222 -------- -------- ------- --------- -------- Gross profit....................... 100,043 90,769 38,172 (37,924) 191,060 Selling, general and administrative expenses............. 101,268 67,441 31,047 (37,957) 161,799 Amortization of acquisition goodwill and other intangibles............... 1,409 929 184 - 2,522 -------- -------- ------- --------- -------- Operating income................... (2,634) 22,399 6,941 33 26,739 Interest expense..................... 3,786 8,759 2,221 33 14,799 Equity in net earnings of subsidiaries........................ 12,261 - - (12,261) - -------- -------- ------- --------- -------- Income before income taxes......... 5,841 13,640 4,720 (12,261) 11,940 Income tax expense................... (1,442) 5,051 1,048 - 4,657 -------- -------- ------- --------- -------- Net income......................... $ 7,283 $ 8,589 $ 3,672 $ (12,261) $ 7,283 ======== ======== ======= ========= ========
CONDENSED CONSOLIDATING BALANCE SHEETS MAY 1, 1999 (in thousands) Nine West Group Guarantor Non-Guarantor Elimination Inc. Subsidiaries Subsidiaries Entries Consolidated ---------- ------------ ------------- ----------- ------------ ASSETS Current Assets: Cash............................... $ 12,998 $ 25 $ 16,614 $ - $ 29,637 Accounts receivable including securitized interest in accounts receivable - net................. 45,573 (68,331) 113,174 - 90,416 Inventories........................ 148,952 198,676 75,829 - 423,457 Prepaid expenses and other current assets.................... 34,434 22,962 8,536 - 65,932 Due (to) from affiliates........... (349,190) 382,481 (33,291) - - ---------- -------- -------- --------- ---------- Total current assets............. (107,233) 535,813 180,862 - 609,442 Property and equipment - net......... 117,696 16,636 27,555 - 161,887 Goodwill - net....................... 201,230 - 27,391 - 228,621 Trademarks and trade names - net..... 1,092 133,977 1,724 - 136,793 Other assets......................... 71,872 2,804 3,703 (26,800) 51,579 Investment in subsidiaries........... 794,531 - - (794,531) - ---------- -------- -------- --------- ---------- Total assets................... $1,079,188 $689,230 $241,235 $(821,331) $1,188,322 ========== ======== ======== ========= ========== LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable................... $ 17,366 $ 45,161 $ 11,139 $ - $ 73,666 Accrued expenses and other current liabilities....................... 56,134 13,216 16,160 - 85,510 Current portion of long-term debt.. - - 3,925 - 3,925 ---------- -------- -------- --------- ---------- Total current liabilities........ 73,500 58,377 31,224 - 163,101 Long-term debt....................... 467,127 - 19,629 - 486,756 Other non-current liabilities........ 63,544 2 30,014 (26,102) 67,458 ---------- -------- -------- --------- ---------- Total liabilities.............. 604,171 58,379 80,867 (26,102) 717,315 Stockholders' equity................. 475,017 630,851 160,368 (795,229) 471,007 ---------- -------- -------- --------- ---------- Total liabilities and stockholders' equity........ $1,079,188 $689,230 $241,235 $(821,331) $1,188,322 ========== ======== ======== ========= ==========
CONDENSED CONSOLIDATING BALANCE SHEETS JANUARY 30, 1999 (in thousands) Nine West Group Guarantor Non-Guarantor Elimination Inc. Subsidiaries Subsidiaries Entries Consolidated ---------- ------------ ------------- ----------- ------------ ASSETS Current Assets: Cash............................. $ 9,776 $ 26 $ 8,149 $ - $ 17,951 Accounts receivable including securitized interest in accounts receivable - net................ 34,363 (50,868) 102,999 - 86,494 Inventories...................... 140,112 246,634 73,629 - 460,375 Prepaid expenses and other current assets.................. 38,047 23,488 5,897 - 67,432 Due (to) from affiliates......... (285,991) 307,097 (21,106) - - ---------- -------- -------- --------- ---------- Total current assets........... (63,693) 526,377 169,568 - 632,252 Property and equipment - net....... 118,345 17,588 28,073 - 164,006 Goodwill - net..................... 202,635 - 27,602 - 230,237 Trademarks and trade names - net... 1,099 134,906 1,890 - 137,895 Other assets....................... 70,838 4,100 4,601 (26,800) 52,739 Investment in subsidiaries......... 783,782 - - (783,782) - ---------- -------- -------- --------- ---------- Total assets................. $1,113,006 $682,971 $231,734 $(810,582) $1,217,129 ---------- -------- -------- --------- ---------- LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable................. $ 19,027 $ 46,712 $ 13,786 $ - $ 79,525 Accrued expenses and other current liabilities............. 69,949 14,833 14,285 - 99,067 Current portion of long-term debt - - 3,449 - 3,449 ---------- -------- -------- --------- ---------- Total current liabilities...... 88,976 61,545 31,520 - 182,041 Long-term debt..................... 498,745 - 12,059 - 510,804 Other non-current liabilities...... 62,442 1 29,879 (26,102) 66,220 ---------- -------- -------- --------- ---------- Total liabilities............ 650,163 61,546 73,458 (26,102) 759,065 Stockholders' equity............... 462,843 621,425 158,276 (784,480) 458,064 ---------- -------- -------- --------- ---------- Total liabilities and stockholders' equity...... $1,113,006 $682,971 $231,734 $(810,582) $1,217,129 ========== ======== ======== ========= ==========
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS 13 WEEKS ENDED MAY 1, 1999 (in thousands) Nine West Group Guarantor Non-Guarantor Elimination Inc. Subsidiaries Subsidiaries Entries Consolidated --------- ------------ ------------- ----------- ------------ Net cash provided by operating activities.......................... $ 37,408 $ 312 $ 1,125 $ - $ 38,845 --------- --------- -------- -------- --------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment.. (5,288) (340) (1,755) - (7,383) Other investing activities........... 533 (49) 355 - 839 --------- --------- -------- -------- --------- Net cash used by investing activities.......................... (4,755) (389) (1,400) - (6,544) --------- --------- -------- -------- --------- CASH FLOWS FROM FINANCING ACTIVITIES: Net (repayments) borrowings under financing agreements................ (32,001) - 8,046 - (23,955) Net proceeds from issuance of stock and other........................... 2,570 76 694 - 3,340 --------- --------- -------- -------- --------- Net cash (used) provided by financing activities.......................... (29,431) 76 8,740 - (20,615) --------- --------- -------- -------- --------- NET INCREASE (DECREASE) IN CASH...... 3,222 (1) 8,465 - 11,686 CASH, BEGINNING OF PERIOD............ 9,776 26 8,149 - 17,951 --------- --------- -------- -------- --------- CASH, END OF PERIOD.................. $ 12,998 $ 25 $ 16,614 $ - $ 29,637 ========= ========= ======== ======== =========
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS 13 WEEKS ENDED MAY 2, 1998 (in thousands) Nine West Group Guarantor Non-Guarantor Elimination Inc. Subsidiaries Subsidiaries Entries Consolidated --------- ------------ ------------- ----------- ------------ Net cash provided (used) by operating activities.......................... $ 21,700 $ 194 $ (298) $ - $ 21,596 --------- --------- -------- -------- --------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment.. (4,839) (670) (1,852) - (7,361) Proceeds from sale of property and equipment........................... 16,351 - - - 16,351 Business acquisition - net of cash acquired............................ - - (9,025) - (9,025) Other investing activities........... (3,861) 383 3,425 - (53) --------- --------- -------- -------- --------- Net cash provided (used) by investing activities.......................... 7,651 (287) (7,452) - (88) --------- --------- -------- -------- --------- CASH FLOWS FROM FINANCING ACTIVITIES: Net repayments under financing agreements................ (24,861) - 1,100 - (23,761) Net proceeds from issuance of stock and other........................... 614 93 387 - 1,094 --------- --------- -------- -------- --------- Net cash (used) provided by financing activities.......................... (24,247) 93 1,487 - (22,667) --------- --------- -------- -------- --------- NET INCREASE (DECREASE) IN CASH...... 5,104 - (6,263) - (1,159) CASH, BEGINNING OF PERIOD............ 10,526 39 13,109 - 23,674 --------- --------- -------- -------- --------- CASH, END OF PERIOD.................. $ 15,630 $ 39 $ 6,846 $ - $ 22,515 ========= ========= ======== ======== =========
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. The following discussion and analysis should be read in conjunction with the Condensed Consolidated Financial Statements of the Company and the Notes thereto included in Item 1 of this report. RESULTS OF OPERATIONS NET INCOME. Net income for the first quarter of 1999 was $9.6 million, or $0.28 per diluted share, a 31.8% increase from net income of $7.3 million, or $0.20 per diluted share, for the first quarter of 1998. NET REVENUES. Net revenues were $441.9 million in the first quarter of 1999 compared to $448.3 million in the first quarter of 1998, a decrease of $6.4 million, or 1.4%. Domestic wholesale net revenues decreased by $5.3 million, or 2.5%, for the first quarter of 1999 due primarily to the weakness in consumer demand in the domestic retail footwear market. This decrease was offset in part by an increase in net revenues for the Company's wholesale accessories business of $11.9 million, or 61.8%, for the first quarter of 1999. Domestic retail net revenues decreased $5.7 million, or 3.3%, for the first quarter of 1999. The decrease in net revenues was due primarily to the Company's strategy of a slower, more controlled approach to retail growth which resulted in the closure (net of openings) of 18 domestic retail stores, and to a comparable store sales decrease of 3.1% due primarily to the weakness in consumer demand in the domestic retail footwear market noted above. International net revenues, which are primarily derived from retail operations, increased $4.5 million, or 6.7%, for the first quarter of 1999 due primarily to increased volume from 45 retail locations opened or acquired (net of closings) since May 2, 1998 ($4.9 million). During the first quarter of 1999, retail and wholesale operations accounted for 50.2% and 49.8% of the Company's consolidated net revenues, as compared to 49.5% and 50.5% for the comparable prior year period, respectively. Net revenues from the Company's international segment, which are included in the wholesale and retail percentages noted above, accounted for 16.3% of the Company's consolidated net revenues for the first quarter of 1999, compared to 15.1% of consolidated net revenues for the comparable prior year period. GROSS PROFIT. Gross profit was $196.5 million in the first quarter of 1999 compared to $191.1 million in the first quarter of 1998, an increase of $5.4 million, or 2.8%. Gross profit as a percentage of net revenues was 44.5% for the first quarter of 1999, compared to 42.6% for the comparable prior year period. The increase in gross profit as a percentage of net revenues was due primarily to increased gross margins in the Company's domestic wholesale and domestic retail businesses primarily attributable to improved inventory controls and better assortment of product offerings. SELLING, GENERAL & ADMINISTRATIVE EXPENSES. SG&A expenses were $165.8 million in the first quarter of 1999, compared to $161.8 million in the first quarter of 1998, an increase of $4.0 million, or 2.5%. SG&A expense expressed as a percentage of net revenues was 37.5% for the first quarter of 1999, up from 36.1% for the comparable prior year period. The increase in SG&A expenses as a percentage of net revenues was due primarily to increased net revenues in the Company's international retail business, which provides a higher gross profit margin but also carries a higher selling, general and administrative expense margin than domestic operations. INTEREST EXPENSE. Interest expense was $12.2 million in the first quarter of 1999, compared to $14.8 million in the first quarter of 1998, a decrease of $2.6 million, or 17.5%, due primarily to a decrease in the Company's weighted average debt. Weighted average debt outstanding was approximately $530 million for the first quarter of 1999, compared to approximately $705 million for the comparable prior year period. The decrease in weighted average debt for the first quarter of 1999 was attributable primarily to the increase in cash provided by operating activities discussed below. Weighted average interest rates were 7.5% and 7.2% for the first quarter of 1999 and 1998, respectively. LIQUIDITY AND CAPITAL RESOURCES The Company relies primarily upon cash flow from operating activities and borrowings under the Company's revolving credit facility to finance its operations and expansion. Cash provided by operating activities was $38.8 million for the first quarter of 1999, compared to $21.6 million for the first quarter of 1998. The increase in cash provided by operating activities was due primarily to inventory management improvements which resulted in a significant decrease in the Company's investment in inventory. Working capital was $446.3 million at May 1, 1999, compared to $450.2 million at January 30, 1999, a decrease of $3.9 million. Working capital may vary from time to time as a result of seasonal requirements, the timing of factory shipments and the Company's "open stock" and "quick response" wholesale programs, which require an increased investment in inventories. Cash used by investing activities was $6.5 million for the first quarter of 1999, compared to $0.1 million for the first quarter of 1998. Capital expenditures totaled $7.4 million for each of the first quarters of 1999 and 1998, and related primarily to the Company's retail location expansion and remodeling programs ($4.1 million and $4.0 million for the first quarters of 1999 and 1998, respectively. Cash used by investing activities during the first quarter of 1998 included $9.0 million for the purchase of Cable & Co. (UK) Limited, a United Kingdom-based footwear and accessories company, involving 25 retail locations situated primarily in the United Kingdom. Proceeds from the sale of property and equipment during the first quarter of 1998 included $16.4 million for the sale of certain office and warehouse facilities located in Cincinnati, Ohio, which the Company had acquired in connection with the acquisition of the Footwear Division of The United States Shoe Corporation. The Company estimates that its capital expenditures for 1999 will be approximately $30.0 million, relating primarily to the ongoing expansion of its domestic and international retail operations (approximately $15.0 million), and equipment for its distribution, manufacturing and management information systems (approximately $4.0 million). The actual amount of the Company's capital expenditures depends, in part, on the number of new retail locations opened, the number of retail locations remodeled, the amount of any construction allowances the Company may receive from the landlords of its new retail locations and any unexpected costs incurred in connection with year 2000 compliance (See "--Year 2000 Compliance"). The Company's ongoing evaluation of its retail operations has led to a decision to grow its retail network at a slower pace by applying rigorous standards to all retail location opening and closing decisions. The opening and success of new retail locations will be dependent upon, among other things, general economic and business conditions affecting consumer spending, the availability of desirable locations and the negotiation of acceptable lease terms for new locations. Cash used by financing activities was $20.6 million and $22.7 million during the first quarters of 1999 and 1998, respectively. Cash used by financing activities during the first quarter of 1999 included a $24.0 million reduction in borrowings under the Company's revolving credit facility primarily attributable to inventory management improvements which resulted in a significant decrease in the Company's investment in inventory. The Company is permitted to borrow up to $500.0 million under the terms of its revolving credit facility, of which up to $150.0 million may be utilized for letters of credit and up to $250.0 million may be in the form of multicurrency borrowings. As of May 1, 1999, $14.6 million of multicurrency borrowings backed by letters of credit and $45.6 million of other letters of credit were outstanding on a revolving basis, and $439.8 million was available for future borrowing. In the fourth quarter of 1998, the Company recorded a pre-tax charge of $18.0 million (the "1998 Restructuring Charge") related to the restructuring of the Company's manufacturing operations and the Company's decision to close its 9 & Co. retail stores. Inventory write-downs of $5.4 million associated with the charge were recorded as a component of costs of goods sold. The 1998 Restructuring Charge related to costs associated with: (1) the closure of one domestic manufacturing facility and one Caribbean-based component facility, and the reconfiguration and integration of certain operations at three other domestic manufacturing facilities (the "Manufacturing Restructuring"); and (2) the Company's decision to close all 63 9 & Co. stores in operation at January 30, 1999. The major components of the 1998 Restructuring Charge were: (1) asset write-downs of $12.9 million; (2) lease termination and facility closure costs of $3.5 million; and (3) severance and termination benefit costs of $1.6 million. Total cash outlays related to the 1998 Restructuring Charge are estimated to be $5.1 million and are to be substantially paid through 2000, with certain lease termination costs to be paid through 2002. During the fourth quarter of 1998, the Company substantially completed the activities associated with the Manufacturing Restructuring. During the first quarter of 1999, the Company closed 12 of the 9 & Co. stores. The Company anticipates that it will close approximately 50 of the 63 9 & Co. stores during 1999, and close the remaining 9 & Co. stores during 2000. As of May 1, 1999, cash outlays against the 1998 Restructuring Charge accrual were $0.9 million and included $0.5 million in severance and termination benefit payments ($0.3 million during the first quarter of 1999) and $0.4 million in lease termination and facility closure costs (all during the first quarter of 1999). The initiatives outlined in the 1998 Restructuring Charge are expected to affect approximately 1,260 employees, of which 640 are manufacturing positions, 580 are 9 & Co. retail employees and 40 are managerial employees. Total severance and termination benefit costs associated with these initiatives are estimated to be $2.9 million, of which $1.6 million was included in the 1998 Restructuring Charge and $0.8 million was related to benefits provided by the Company's existing severance plans. The remaining $0.5 million is related to the 9 & Co. store closures. As of May 1, 1999, substantially all of the manufacturing and managerial and 41 of the 9 & Co. position eliminations were completed with $0.4 million in severance and termination benefit costs being charged against the existing severance plan liability. The severance and termination benefit payments associated with the 1998 Restructuring Charge will be substantially completed during 1999. The Company expects that its current cash balances, cash provided by operations and borrowings under the revolving credit facility will continue to provide the capital flexibility necessary to fund future opportunities and expansion as well as to meet existing obligations. The Company continuously evaluates potential acquisitions of businesses which complement its existing operations. Depending on various factors, including, among others, the cash consideration required in such potential acquisitions and the market value of the Company's common stock, the Company may determine to finance any such transaction with its existing sources of liquidity. YEAR 2000 COMPLIANCE The Year 2000 issue is the result of computer programs being written using two digits rather than four to define the applicable year. The Company's computer equipment, software and devices with imbedded technology that are time- sensitive may recognize a date using "00" as the year 1900 rather than the year 2000. The Company has undertaken a comprehensive analysis and remediation program (the "Year 2000 Program") with respect to its information technology ("IT") systems and other systems and facilities in order to identify the systems that could be affected by the technical problems associated with the year 2000 (the "Year 2000 Issue") and to ensure that they will function properly with respect to dates in the year 2000 and thereafter. If modifications and replacements are not made in a timely manner, the Company could experience a temporary inability to process transactions, send invoices or engage in other important business activities due to system failures or miscalculations, the impact of which cannot be quantified at this time. The Company's Year 2000 Program is divided into the following four phases with the following estimated time frames: (1) Planning (fourth quarter of 1996 - second quarter of 1998) - Establishing a Year 2000 program team and developing a comprehensive strategy. (2) Assessment (third quarter of 1997 - first quarter of 1999) - Assessing the year 2000 impact on the Company through inventory and analysis of systems supporting the core business areas and processes, prioritizing their conversion or replacement and identifying and securing necessary resources to do so. This phase may include developing contingency plans, if necessary. (3) Renovation (fourth quarter of 1997 - second quarter of 1999) - Converting, replacing, or eliminating selected platforms, applications, databases and utilities and modifying interfaces. (4) Validation and Implementation (first quarter of 1998 - third quarter of 1999) - Testing, verifying and validating converted or replaced platforms, applications, databases and utilities in an operational environment and implementing contingency plans, if necessary. In the third quarter of 1997, the Company commenced the assessment of its domestic IT software and hardware. The Company expects to substantially complete the development, programming changes and unit testing including compatibility testing, with respect to its domestic IT systems in the second quarter of 1999. In the first quarter of 1998, the Company commenced the assessment of its international IT software and hardware. The Company expects to substantially complete the development, programming changes and unit testing, including compatibility testing, with respect to its international IT systems in the second quarter of 1999. The Company completed the assessment of its non- computer equipment that could be affected by the technical problems associated with the Year 2000 Issue in the first quarter of 1999 and plans to fully test such equipment by the end of the second quarter of 1999. As of May 31, 1999, the Company had completed approximately 80% of all phases of the Year 2000 Program, consistent with its timetable. Through May 1, 1999, the Company has expended approximately $5.0 million related to its global Year 2000 Program. The Company currently expects that the total costs of the Year 2000 Program, including both incremental spending and redeployed resources, will be approximately $6.0 million. The costs of the Year 2000 Program will be funded through existing sources of liquidity. Time and cost estimates are based on currently available information. Developments that could affect estimates include, but are not limited to, the availability and cost of trained personnel and the ability to locate and correct all relevant computer code and systems. The Company has been communicating, and continues to communicate, directly with selected key vendors, suppliers and customers regarding various critical systems. Additionally, to date the Company has mailed questionnaires to other identified significant third parties to determine the extent to which the Company is vulnerable to the failure of these third parties to become Year 2000 compliant. None of the third parties who have responded have disclosed Year 2000 issues which would have an adverse affect on the Company. However, third parties are under no contractual obligation to provide Year 2000 compliance information to the Company, and any failure of such third parties to become Year 2000 compliant involves risks and uncertainties. Based upon its assessment and remediation efforts to date, the Company is not aware of any material issues that would prevent it or its significant third party vendors, suppliers and customers from completing efforts necessary to achieve Year 2000 compliance on a timely basis. Accordingly, the Company has not developed a contingency plan for dealing with the most reasonably likely worst case scenario at this time. SEASONALITY The Company's footwear and accessories are marketed primarily for each of the four seasons, with the highest volume of products sold during the last three fiscal quarters. Because the timing of shipment of products for any season may vary from year to year, the results for any particular quarter may not be indicative of results for the full year. The Company has not had significant overhead and other costs generally associated with large seasonal variations. INFLATION The Company believes that the relatively moderate rate of inflation over the past few years has not had a significant impact on the Company's revenues or profitability. In the past, the Company has been able to maintain its profit margins during inflationary periods. FORWARD-LOOKING STATEMENTS Certain statements contained in this Report which are not historical facts contain forward-looking information with respect to the Company's plans, projections or future performance, the occurrence of which involve certain risks and uncertainties that could cause the Company's actual results or plans to differ materially from those expected by the Company. Certain of such risks and uncertainties relate to the overall strength of the general domestic and international retail environments; the continuation of certain trends in foreign currency exchange rates; the ability of the Company to predict and respond to changes in consumer demand and preferences in a timely manner; increased competition in the footwear and accessory industry and the Company's ability to remain competitive in the areas of style, price and quality; acceptance by consumers of new product lines; the ability of the Company to manage general and administrative costs; changes in the costs of leather and other raw materials, labor and advertising; the ability of the Company to secure and protect trademarks and other intellectual property rights; retail store construction delays; the availability of desirable retail locations and the negotiation of acceptable lease terms for such locations; and the ability of the Company to place its products in desirable sections of its department store customers. ITEM 3. QUANTATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. The market risk inherent in the Company's financial instruments represents the potential loss in fair value, earnings or cash flows arising from adverse changes in interest rates or foreign currency exchange rates. The Company manages this exposure through regular operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments. Company policy allows the use of derivative financial instruments for identi- fiable market risk exposures, including interest rate and foreign currency fluctuations. The Company does not enter into derivative financial contracts for trading or other speculative purposes. Since January 30, 1999, there have been no significant changes in the Company's interest rate and foreign currency exposures, changes in the types of derivative instruments used to hedge those exposures, or significant changes in underlying market conditions. PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS The Federal Trade Commission is currently conducting an inquiry with respect to the Company's resale pricing policies to determine whether the Company violated the federal antitrust laws by agreeing with others to restrain the prices at which retailers sell footwear and other products marketed by the Company. In addition, Attorneys General from the States of Florida, New York, Ohio and Texas are conducting similar inquiries. Since January 13, 1999, more than 25 putative class actions have been filed on behalf of purchasers of the Company's footwear in four separate fed- eral courts alleging that the Company violated Section 1 of the Sherman Act by engaging in a conspiracy with its retail distributors to fix the minimum prices at which the footwear marketed by the Company was sold to the public. Three of these class action complaints have been consolidated into a single action in the United States District Court for the Southern District of New York and seek injunctive relief, unspecified compensatory and treble damages, and attorneys' fees. The fourth federal action, originally filed in district court in Pennsylvania, is in the process of being transferred and consolidated with the federal action in New York. In addition, five putative class actions based on the same alleged conduct have been filed in state courts in New York, the District of Columbia, Wisconsin, California and Minnesota alleging violations of those states' respective antitrust laws. The five state actions likewise seek injunctive relief, unspecified compensatory and treble damages, and attorneys' fees. Based on the short period of time that has elapsed since the inception of the inquiries and the filing of the lawsuits, the Company's existing policies relating to resale pricing and the limited information available to the Company with respect to compliance with those policies, the Company does not anticipate that the inquiries or lawsuits will result in a material adverse financial effect on the Company. On March 3, 4 and 5, 1999, four purported stockholder class action suits were filed against the Company, the members of the Company's Board of Directors and Jones in the Delaware Court of Chancery. These complaints allege, among other things, that the defendants have breached their fiduciary duties to Company stockholders by failing to maximize stockholder value in connection with entering into the Merger Agreement with Jones. See Note 10 to the Con- densed Consolidated Financial Statements, "Merger Agreement," in Item 1. The complaints seek, among other things, an order enjoining completion of the merger. The Company and Jones believe that the complaints are without merit and plan to defend vigorously against the complaints. The Company has been named as a defendant in various actions and proceedings, including actions brought by certain terminated employees, arising from its ordinary business activities. Although the amount of any liability that could arise with respect to these actions cannot be accurately predicted, in the opinion of the Company, any such liability will not have a material adverse financial effect on the Company. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits: See Index to Exhibits (b) Reports on Form 8-K: The Company filed a Current Report on Form 8-K dated February 1, 1999, for the purpose of reporting under Item 5 thereof the issuance of a press release announcing that it was informed on that date by the staff of the United States Securities and Exchange Commission that its pending investigation of the Company had been terminated with no enforcement action being recommended against the Company. The Company had previously disclosed that the formal investigation, of which it was advised on May 1, 1997, related primarily to the Company's revenue recognition policies and practices and later examined the Company's importation of products manufactured in Brazil. A copy of the press release was filed therewith as Exhibit 20.1. The Company filed a Current Report on Form 8-K dated March 2, 1999, for the purpose of reporting under Item 5 thereof that on March 2, 1999, the Company, Jones and Merger Sub entered into the Merger Agreement and that, pursuant to a Stockholder Agreement, dated as of March 1, 1999 (the "Stockholder Agreement") among Vincent Camuto, Jerome Fisher (the "Holders") and Jones, the Holders had agreed, among other things, to vote their shares of common stock in favor of the Merger. See Note 10 to Condensed Consolidated Financial Statements, "Merger Agreement," in Item 1. Copies of the Merger Agreement, the Stockholder Agreement and a joint press release of the Company and Jones, dated March 2, 1999, were filed therewith as Exhibits 2, 99.1 and 99.2, respectively, and were incorporated therein by reference. 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. Nine West Group Inc. (Registrant) By: /s/ Robert C. Galvin --------------------------- Robert C. Galvin Executive Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer and Principal Accounting Officer) Date: June 14, 1999 INDEX TO EXHIBITS Exhibit Number Exhibit ------ ------- 27 Financial Data Schedule. EX-27 2
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE NINE WEST GROUP INC. CONDENSED CONSOLIDATED BALANCE SHEET AS OF MAY 1, 1999 AND THE CONDENSED CONSOLIDATED STATEMENT OF INCOME AND CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE THIRTEEN WEEKS THEN ENDED AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 3-MOS JAN-29-2000 MAY-01-1999 29,637 0 140,642 (50,226) 423,457 609,442 251,840 (89,953) 1,188,322 163,101 486,756 0 0 360 470,647 1,188,322 441,867 441,867 245,409 245,409 167,241 1,272 12,203 15,742 6,139 9,603 0 0 0 9,603 0.28 0.28
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