-----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, GriU7T09a4TH8yEgxge9ZQSiWRPMCVibPeE64dlJuniMUwdlQi9LChvJ7B9Cs/2l YZPCVpPK0NPyaffLHive2w== 0000927016-98-000080.txt : 19980114 0000927016-98-000080.hdr.sgml : 19980114 ACCESSION NUMBER: 0000927016-98-000080 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19971129 FILED AS OF DATE: 19980113 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: TREND LINES INC CENTRAL INDEX KEY: 0000922978 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-CATALOG & MAIL-ORDER HOUSES [5961] IRS NUMBER: 042722797 STATE OF INCORPORATION: MA FISCAL YEAR END: 0228 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-24390 FILM NUMBER: 98505548 BUSINESS ADDRESS: STREET 1: 135 AMERICAN LEGION HWY CITY: REVERE STATE: MA ZIP: 02151 BUSINESS PHONE: 6178530900 MAIL ADDRESS: STREET 1: 135 AMERICAN LEGION HWY CITY: REVERE STATE: MA ZIP: 02151 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED NOVEMBER 29, 1997 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ------------------ TO ----------------- 0-24390 Commission file number . . . . . . . . . . . . . . . . . TREND - LINES, INC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (Exact name of registrant as specified in its charter) Massachusetts 04-2722797 . . . . . . . . . . . . . . . . . . . . . . . . . . (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 135 American Legion Highway, Revere , Massachusetts 02151 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (Address of principal executive office) (Zip Code) (617) 853 - 0900 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (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...... Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.
CLASS NUMBER OF SHARES OUTSTANDING JANAURY 12, 1997 -------------- --------------------------------------------- Class A Common Stock, $.01 par value 5,863,598 Class B Common Stock, $.01 par value 4,750,026
TREND-LINES, INC. AND SUBSIDIARY INDEX Page ---- Part I - Financial Information Item 1. Financial Statements Condensed Consolidated Balance Sheets November 29, 1997 (Unaudited) and March 1, 1997 3 Condensed Consolidated Statements of Operations Three Months Ended and Nine Months Ended November 29, 1997 and November 30, 1996 (Unaudited) 4 Condensed Consolidated Statements of Cash Flows Nine Months Ended November 29, 1997 and November 30, 1996 (Unaudited) 5 Notes to Condensed Consolidated Financial Statements 6-9 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 10-13 Part II - Other Information 14 Item 1. Legal Proceedings 14 Item 2. Changes in Securities 14 Item 3. Defaults Upon Senior Securities 14 Item 4. Submission of Matters to a Vote of Security Holders 14 Item 5. Other Information 14 Item 6. Exhibits and Reports on Form 8-K 14 Signatures 15 2 PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS TREND-LINES, INC. AND SUBSIDIARY CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT SHARE AMOUNTS)
ASSETS (UNAUDITED) NOVEMBER 29, MARCH 1, 1997 1997 ------------------ ----------------- CURRENT ASSETS: Cash and cash equivalents $ 279 $ 1,006 Accounts receivable, net 15,705 12,155 Inventories 88,987 85,909 Prepaid expenses and other current assets 6,372 6,462 -------- -------- Total current assets 111,343 105,532 PROPERTY AND EQUIPMENT, NET 17,694 14,753 OTHER ASSETS 634 769 -------- -------- $129,671 $121,054 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Bank credit facility $ 43,607 $ 25,196 Current portion of capital lease obligations 854 686 Accounts payable 32,518 43,900 Accrued expenses 6,228 5,690 -------- -------- Total current liabilities 83,207 75,472 -------- -------- CAPITAL LEASE OBLIGATIONS, NET OF CURRENT PORTION 1,235 1,875 -------- -------- DEFERRED INCOME TAX LIABILITIES 301 301 -------- -------- STOCKHOLDERS' EQUITY: Common stock, $.01 par value Class A- Issued--6,348,568 and 6,302,534 shares at November 29, 1997 and March 1, 1997, respectively 63 63 Class B- Issued and Outstanding--4,750,026 shares at November 29, 1997 and March 1, 1997 47 47 Additional paid-in capital 41,459 41,318 Retained earnings 5,819 4,128 Less: 500,000 and 440,000 Class A shares held in treasury at November 29,1997 and March 1, 1997, respectively, at cost (2,460) (2,150) -------- -------- Total stockholders' equity 44,928 43,406 -------- -------- $129,671 $121,054 ======== ========
See notes to condensed consolidated financial statements. 3 TREND-LINES, INC. AND SUBSIDIARY CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (Unaudited)
--Three months ended-- --Nine months ended-- November 29, November 30, November 29, November 30, 1997 1996 1997 1996 ------- ------- -------- -------- NET SALES $52,357 $49,100 $160,265 $145,238 COST OF SALES 36,141 33,083 108,704 97,582 ------- ------- -------- -------- Gross Profit 16,216 16,017 51,561 47,656 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 13,872 14,249 46,416 44,175 ------- ------- -------- -------- Income from operations 2,344 1,768 5,145 3,481 INTEREST EXPENSE, net of interest income 943 693 2,374 1,718 ------- ------- -------- -------- Income before provision for income taxes 1,401 1,075 2,771 1,763 PROVISION FOR INCOME TAXES 546 435 1,080 714 ------- ------- -------- -------- Net income $ 855 $ 640 $ 1,691 $ 1,049 ======= ======= ======== ======== NET INCOME PER COMMON SHARE $0.08 $0.06 $0.15 $0.09 ======= ======= ======== ======== WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 11,175 11,305 11,120 11,294 ======= ======= ======== ========
See notes to condensed consolidated financial statements 4 TREND-LINES, INC. AND SUBSIDIARY CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (IN THOUSANDS) (Unaudited)
----NINE MONTHS ENDED---- NOVEMBER 29, NOVEMBER 30, 1997 1996 ------------------ ----------------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 1,691 $ 1,049 Adjustments to reconcile net income to net cash used in operating activities Depreciation and amortization 1,951 1,292 Gain on sale of property and equipment - (18) Changes in current assets and liabilities Accounts receivable (3,549) (3,417) Refundable income taxes - 2,840 Inventories (3,078) (8,222) Prepaid expenses and other current assets 89 (1,442) Accounts payable (11,382) (4,012) Accrued expenses 538 (489) -------- -------- Net cash used in operating activities (13,740) (12,419) -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment (4,859) (2,023) Proceeds from sale of property and equipment 9 - (Increase) decrease in other assets 135 (312) -------- -------- Net cash used in investing activities (4,715) (2,335) -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES: Net proceeds from exercise of stock options - 10 Net borrowings under bank credit facilities 18,411 15,865 Payments on capital lease obligations (514) (417) Proceeds from exercise of stock options 141 - Purchases of treasury stock (310) (771) -------- -------- Net cash provided by financing activities 17,728 14,687 -------- -------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (727) (67) CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 1,006 436 -------- -------- CASH AND CASH EQUIVALENTS, END OF PERIOD $ 279 $ 369 ======== ======== SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid for- Interest $ 2,289 $ 1,220 ======== ======== Income taxes $ 1,622 $ 170 ======== ========
See notes to condensed consolidated financial statements 5 TREND-LINES, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 1. BASIS OF PRESENTATION - ------------------------ The information set forth in these financial statements is unaudited and may be subject to normal year end adjustments. In the opinion of management, the information reflects all adjustments, which consist of normal recurring accruals, that are considered necessary to present a fair statement of the results of operations of Trend-Lines, Inc. (the Company) for the interim periods presented. The operating results for the nine months ended November 29, 1997 are not necessarily indicative of the results to be expected for the fiscal year ending February 28, 1998. The financial statements presented herein should be read in conjunction with the financial statements included in the Company's Annual Report on Form 10-K for the year ended March 1, 1997. Certain information in footnote disclosures normally included in financial statements have been condensed or omitted in accordance with the rules and regulations of the Securities and Exchange Commission. 2. EARNINGS PER SHARE DATA - -------------------------- Net income per share for the nine months ended November 29, 1997 and November 30, 1996 is computed by dividing net income by the weighted average number of shares of common stock and common stock equivalents outstanding during the period. Common stock equivalents are calculated using the treasury stock method and consist of common stock issuable upon the exercise of outstanding stock options. In February 1997, the Financial Accounting Standards Board issued SFAS No. 128, Earnings Per Share. SFAS No. 128 establishes standards for computing and presenting earnings per share and applies to entities with publicly held common stock or potential common stock. This statement is effective for the fiscal years ending after December 15, 1997 and early adoption is not permitted. When adopted, the statement will require restatement of prior years' earnings per share. The Company will adopt this statement for its fiscal year ending February 28, 1998. 6 Pro forma calculations of basic and diluted earnings per share as required by SFAS No. 128 are as follows (in thousands, except per share data):
----THREE MONTHS ENDED---- ----NINE MONTHS ENDED---- NOVEMBER 29, NOVEMBER 30, NOVEMBER 29, NOVEMBER 30, 1997 1996 1997 1996 ---- ---- ---- ---- Basic EPS Net income $ 855 $ 640 $ 1,691 $ 1,049 Weighted average common shares outstanding 10,589 11,014 10,581 11,035 ------- ------- ------- ------- Basic EPS $ .08 $ .06 $ .16 $ .10 ======= ======= ======= ======= Diluted EPS Net income $ 855 $ 640 $ 1,691 $ 1,049 Weighted average common and common equivalent shares outstanding 11,175 11,305 11,120 11,294 ------- ------- ------- ------- Diluted EPS $ .08 $ .06 $ .15 $ .09 ======= ======= ======= =======
3. BANK CREDIT FACILITY - ------------------------ During fiscal 1996, the Company entered into a secured line of credit agreement with a bank that expires on July 3, 1999. The facility bears interest at the bank's reference rate plus .75% (9.0% at November 29, 1997) or LIBOR plus 2.25% (7.74% at November 29, 1997). If for any 12 month rolling period, effective as of March 1, 1997, the fixed charges ratio exceeds certain limits, as defined, the bank's interest rate on the facility is decreased by .25% for the period immediately following such rolling period. Since March 1, 1997 the Company has exceeded the fixed charges ratio. A commitment fee of .375% per year of the average unused commitment amount, as defined, is payable monthly. Effective June 16, 1997 the Company's revolving credit facility line of credit was increased from $40 million to $50 million (borrowings include amounts reserved for outstanding letters of credit and a foreign exchange facility). Borrowings are based on a formula related to inventory levels, as defined. As of December 31, 1997 , the Company's revolving credit facility was amended to increase the line of credit from $50 million to $80 million (borrowings include 50% of the amounts reserved for outstanding letters of credit). This amendment also extends the facility to expire on December 31, 2000. 7 At November 29, 1997, the Company had approximately $43.5 million of borrowings outstanding and approximately $1.1 million of letters of credit outstanding. The Company had approximately $5.4 million in available borrowings under this facility at November 29, 1997, based on the $50 million line of credit. The maximum and average outstanding loan balances during fiscal 1997 under this facility were $45.7 million and $38.2 million, respectively. The bank has a security interest in substantially all assets of the Company. The bank credit facility agreement contains certain restrictive covenants, including, but not limited to, maintenance of certain levels of tangible net worth, interest coverage ratio's and limitations on capital expenditures. The Company was in compliance with all bank covenants at November 29, 1997. 4. RESTRUCTURING CHARGE - ------------------------ In the fourth quarter of fiscal 1995, the Company recorded a restructuring charge of approximately $1.4 million, representing the costs associated with reorganizing its operations. These costs included a $954,000 charge for the rent and related expenses for closing 12 retail store locations and the severance and related benefits for terminated employees. Additionally, $443,000 was charged for the consolidation of the Company's distribution centers. As of November 29, 1997, the 12 retail store locations were closed, as anticipated when the restructuring reserve was established. For the nine months ended November 29, 1997, approximately $0.1 million was charged against the restructuring reserve for store closing related activities and approximately $0.2 million associated with the consolidation of the Company's distribution centers were also charged against the restructuring reserve. As of March 1, 1997, approximately $0.3 million of restructuring costs are included in accrued expenses in the accompanying consolidated balance sheets. There were no non-cash adjustments to the accrual during the nine months ended November 29,1997. As of November 29, 1997 the restructuring reserve had no remaining accrued balance. 5. TREASURY STOCK - ------------------ On August 15, 1996, the Company's Board of Directors approved a stock repurchase plan, whereby the Company may purchase up to 500,000 shares of common stock at fair market value, to be used for future stock option programs, investment and / or other corporate purposes. As of April 15, 1997, the Company had purchased 500,000 shares of Class A common stock for approximately $2.5 million, which completed the stock repurchase plan. 8 6. EMPLOYEE BENEFIT PLANS - --------------------------- On July 15, 1997 the Company's Board of Directors approved an Employee Stock Purchase Plan under which eligible employees of the Company would have the opportunity to purchase without commissions shares of the Company's Class A Common Stock through payroll deductions up to 10% of their base pay compensation. Under the Plan, stock will be purchased from the Company, in open market transactions or a combination thereof. The Plan became effective on October 1, 1997. At the Company's Annual Meeting of stockholders held July 15,1997,stockholders approved an amendment to the Company's 1993 Employee Stock Option Plan to increase the total number of shares of the Company's Class A Common Stock from 1,275,000 to 1,525,000 for issuance thereunder. On July 15, 1997, the Company's Board of Directors also authorized the grant of an aggregate of 91,300 incentive stock options under the Company's 1993 Employee Stock Option Plan. These grants were made primarily to store management and office personnel. 7. SUBSEQUENT EVENT - --------------------- On January 7, 1998 the Company entered into a definitive agreement to acquire 13 Nevada Bob's franchised golf stores located in the New England area from a private investment partnership. The Company purchased the net assets, not including Nevada Bob's franchise rights, for approximately $5.5 million, subject to an adjustment for audited operating results. 9 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Results of Operations - --------------------- Net sales for the third quarter of fiscal 1997 increased by $3.3 million, or 6.7%, from $49.1 million for the third quarter of fiscal 1996 to $52.4 million. Net catalog sales for the third quarter of fiscal 1997 decreased $2.0 million or 13.6%, from $14.7 million for the third quarter of fiscal 1996 to $12.7 million for the third quarter of fiscal 1997. Net retail sales for the third quarter of 1997 increased $5.3 million or 15.4% from $34.4 million for the third quarter of fiscal 1996 to $39.7 million. The decrease in net catalog sales was primarily attributable to the Company's opening of retail stores in areas previously only served by its catalogs. The revenue growth of retail stores is attributable to the maturation and expansion of the Company's retail store base. The store base expanded over 19.0% from 147 locations at the end of the third quarter of fiscal 1996 to 175 locations at the end of the third quarter of fiscal 1997. Comparable net store sales for Woodworkers Warehouse / Post Tool stores and Golf Day stores for the third quarter of fiscal 1997 increased by 4.1% as compared to the third quarter of fiscal 1996. Net sales for the first nine months of fiscal 1997 increased by $15.1 million, or 10.4%, from $145.2 million for the first nine months of fiscal 1996 to $160.3 million for the first nine months of fiscal 1997. Comparable net store sales for Woodworkers Warehouse / Post Tool Stores and Golf Day for the first nine months of fiscal 1997 increased by 10.7% as compared to the first nine months of fiscal 1996. Catalog sales for the first nine months of fiscal 1997 decreased $5.5 million , or 11.5%, from $48.0 million for the first nine months of fiscal 1996 to $42.5 million for the first nine months of fiscal 1997, while retail sales increased $20.5 million, or 21.1%, as compared to the first nine months of fiscal 1996. The decrease in net catalog sales was primarily attributable to the Company's opening of retail stores in areas previously only served by its catalog. The revenue growth of retail stores is attributed to the maturation and expansion of the Company's retail base. Gross profit for the third quarter of fiscal 1997 increased 1.2% from $16.0 million for the third quarter of fiscal 1996 to $16.2 million for the third quarter of fiscal 1997. As a percentage of net sales, gross profit decreased 1.6% from 32.6% of net sales for the third quarter of fiscal 1996 to 31.0% of net sales in the third quarter of fiscal 1997. The decrease in the Company's gross profit percentage is primarily the result of the Company's changing sales mix, which is caused by the increase in retail sales as a percentage of total sales (retail store sales generally have lower overall gross margins than catalog sales). Gross profit for the first nine months of fiscal 1997 increased 8.2% from $47.7 million for the first nine months of fiscal 1996 to $51.6 million for the first nine months of fiscal 1997. As a percentage of net sales, gross profit decreased .6% from 32.8% of net sales for first nine months of fiscal 1996 to 32.2% of net sales for the first nine months of fiscal 1997. The decrease in the 10 Company's gross profit percentage was primarily the result of the Company's changing sales mix, which is caused by the increase in retail sales as a percentage of total sales. Selling, general and administrative expenses for the third quarter of fiscal 1997 decreased 2.6%, or $.3 million from $14.2 million for the third quarter of fiscal 1996 to $13.9 million for the third quarter of fiscal 1997. As a percentage of net sales, selling, general and administrative expenses decreased from 29.0% of net sales in the third quarter of fiscal 1996 to 26.5% of net sales in the third quarter of fiscal 1997. The decrease in selling, general and administrative expenses as a percentage of net sales is primarily attributable to the maturation of the store sales base (and associated comparable store sales gains), as well as lower operating costs of retail stores as compared to the catalog business. Selling, general and administrative expenses for the first nine months of fiscal 1997 increased 5.1%, or $2.2 million, from $44.2 million for the first nine months of fiscal 1996 to $46.4 million for the first nine months of fiscal 1997. As a percentage of net sales, selling, general and administrative expenses decreased 1.4% from 30.4% of net sales for the first nine months of fiscal 1996 to 29.0% of net sales for the first nine months of fiscal 1997. The dollar increases in selling, general and administrative expenses are primarily related to the Company's continuing retail expansion. As the result of the above factors, income from operations for the third quarter of fiscal 1997 increased by $.5 million, or 32.6%, from $1.8 million in the third quarter of fiscal 1996 to $2.3 million in the third quarter of fiscal 1997. As a percentage of net sales, income from operations increased from 3.6% of net sales in the third quarter of fiscal 1996 to 4.5% of net sales in the third quarter of fiscal 1997. As the result of the above factors income from operations for the first nine months of fiscal 1997 increased $1.6 million, or 47.8% from $3.5 million in the first nine months of fiscal 1996 to $5.1 million in the first nine months of fiscal 1997. As a percent of net sales, income from operations increased 0.8% from 2.4% of net sales in the first nine months of 1996 to 3.2% of the net sales in the first nine months of fiscal 1997. Interest expense, net of interest income, for the third quarter of fiscal 1997 increased by $250,000 from $693,000 in the third quarter of fiscal 1996 to $943,000 in the third quarter of fiscal 1997. The increase in interest expense is attributable to the increase in the Company's borrowings under its bank credit facility. Interest expense, net of interest income, for the first nine months of fiscal 1997 increased by $656,000 from $1,718,000 in the first nine months of fiscal 1996 to $2,374,000 in the first nine months of fiscal 1997, caused by increased borrowing. 11 Liquidity and Capital Resources - -------------------------------- The Company's working capital decreased by $2.0 million, from $30.1 million as of March 1, 1997 to $28.1 million as of November 29, 1997. During the first nine months of fiscal 1997, net cash used in operating activities was approximately $13.7 million, net cash used in investing activities was approximately $4.7 million and net cash provided by financing activities was approximately $17.7 million. The net cash used in operating activities resulted primarily from a $11.4 million decrease in accounts payable, a $3.5 million increase in accounts receivable and a $3.1 million increase in inventories and that was only partially offset by $3.6 million provided by net income and depreciation. The net cash used in investing activities was primarily related the purchase of property and equipment required for the Company's retail expansion. During the first nine months of fiscal 1997, the net cash provided from financing activities was primarily attributable to $18.4 million in net borrowings under the Company's bank credit facility, offset by $.5 million in payments under capital leases. The Company anticipates that in fiscal 1997, it will continue to invest in leasehold improvements and equipment to support its retail store expansion plans. In addition, the Company's expansion plans will require the use of cash to fund increased inventories associated with the operation of additional retail stores. The Company opened eight stores and closed one store in the third quarter. For fiscal 1997, the Company currently plans to open approximately 35 to 45 retail stores in addition to the 13 Nevada Bob's franchise stores, acquired as discussed below. On January 7, 1998 the Company entered into a definitive agreement to acquire 13 Nevada Bob's franchised golf stores located in the New England area from a private investment partnership. The Company purchased the net assets, not including Nevada Bob's franchise rights, for approximately $5.5 million, subject to an adjustment for audited operating results. Total sales of the 13 stores during 1996 were approximately $20 million. As of December 31, 1997 , the Company's revolving credit facility was amended to increase the line of credit from $50 million to $80 million (borrowings include 50% of the amounts reserved for outstanding letters of credit). This amendment also extends the term of the facility to December 31, 2000. The Company believes that the cash generated from operating activities, trade credit and available bank borrowings will be sufficient to fund its operations and its retail store expansion program for the next twelve months. Impact of Inflation - ------------------- The Company does not believe that inflation has had a material impact on its net sales or results of operations. Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 - -------------------------------------------------------------------------------- 12 Statements included in this report that do not relate to present or historical conditions are "forward-looking statements" within the meaning of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Additional oral or written forward-looking statements may be made by the Company from time to time, and such statements may be included in documents other than this report that are filed with the Securities and Exchange Commission. Such forward-looking statements involve risks and uncertainties that could cause results or outcomes to differ materially from those expressed in such forward- looking statements. Forward-looking statements in this report and elsewhere may include without limitation, statements relating to the Company's plans, strategies, objectives, expectations, intentions and adequacy of resources and are intended to be made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words such as "believes," "forecasts," "intends," "possible," "expects," "estimates," "anticipates," or "plans" and similar expressions are intended to identify forward-looking statements. Investors are cautioned that such forward-looking statements involve risks and uncertainties including without limitation the following: (i) the Company's plans, strategies, objectives, expectations and intentions are subject to change at any time at the discretion of the Company; (ii) the Company's ability to open the planned number of stores will depend upon a number of other factors, including securing desirable locations, negotiating leases with acceptable terms, and hiring, training and retaining qualified personnel; (iii) the Company's plans and results of operations will be affected by the Company's ability to manage its growth and inventory; (iv) the Company's tool and golf businesses are highly competitive and the entrance of new competitors into or the expansion of the operations by existing competitors in the Company's markets and other changes in the tool or golf retail climate could adversely affect the Company's plans and results of operations; and (v) other risks and uncertainties indicated from time to time in the Company's filings with the Securities and Exchange Commission. 13 TREND - LINES, INC. AND SUBSIDIARY Part II - Other Information Item 1. Legal Proceedings Not applicable Item 2. Changes in Securities Not applicable Item 3. Defaults Upon Senior Securities Not applicable Item 4. Submission of Matters to a vote of Security Holders Not applicable Item 5. Other Information Not applicable Item 6. Exhibits and Reports on Form 8-K (a) Exhibits - not applicable (b) Reports on Form 8-K - not applicable 14 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 thereunto duly authorized. TREND-LINES, INC ------------------- Registrant Date: January 12, 1997 /s/ Stanley D. Black ____________________ Stanley D. Black (Chief Executive Officer) /s/ Karl P. Sniady ____________________ Karl P. Sniady (Executive Vice President, Chief Financial Officer) 15 EX-27 2 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONDENSED CONSOLIDATED FINANCIAL STATEMENT OF FINANCIAL CONDITION AT NOVEMBER 29, 1997 (UNAUDITED) AND THE RESULTS OF OPERATIONS FOR THE NINE MONTHS ENDED NOVEMBER 29, 1997 (UNAUDITED) AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 9-MOS YEAR FEB-28-1998 MAR-01-1997 MAR-02-1997 MAR-03-1996 NOV-29-1997 MAR-01-1997 279 1,006 0 0 15,705 12,555 0 0 88,987 85,909 111,343 105,532 17,694 14,753 0 0 129,671 121,054 83,207 75,472 0 0 0 0 0 0 110 110 44,818 43,296 129,671 121,054 160,265 208,582 160,265 208,582 108,704 139,871 108,704 139,871 46,416 61,045 0 0 2,374 2,355 2,771 5,311 0 0 1,691 3,250 0 0 0 0 0 0 1,691 3,250 0 0 .15 .29
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