SOLO SERVE CORPORATION REPORTS MAY SALES, FIRST QUARTER OPERATING
RESULTS
The Closing of the Montgomery, Alabama Store, and the Approval of
the Proposed Disclosure Statement
SAN ANTONIO, Texas--June 1, 1995--Solo Serve
Corporation (Nasdaq: SOLOQ) today reported sales of $8.3 million for the four
week period ended May 27, 1995, on the 30 Solo Serve stores
continuing in operation, all of which were in operation in May 1994.
The Company's comparable store sales decreased 2.9 percent during
the four week period ended May 27, 1995, as compared with the same
period in 1994. Total store sales in May 1994, when the Company
operated 39 Solo Serve stores and 8 Half & More stores, were $11.7
million, of which $3.0 million was associated with stores that are
now closed. Early in May, one of the Company's stores located in
the New Orleans, La. area was closed due to flooding and was
excluded from the comparable store sales calculation for the month
of May. The Company anticipates this store will be closed several
weeks while repairs are being made.
Separately, the Company also reported a net loss for the first
quarter ended April 29, 1995, of $2.6 million or $.46 per share,
compared to net loss of $1.6 million, or $.29 per share for the same
period last year.
The Company's year-to-date sales of $33.5 million for the 17
weeks ended May 27, 1995 represents a decrease of 32.9 percent from
sales of $49.9 million for the same period in 1994. The Company's
year-to-date comparable store sales decreased 11 percent. Net sales
for the first quarter ended April 29, 1995 decreased 34.0 percent
from the prior year first quarter to $25.2 million from $38.2
million, of which $9.1 million was associated with stores that are
now closed. For the quarter ended April 29, 1995, comparable store
sales in continuing stores were down 13.5 percent from the
comparable period of the prior year.
The Company also announced that it has closed its one store in
Montgomery, Ala. During the three quarters following the voluntary
petition under Chapter 11 of the Bankruptcy Code, the direct pre-tax
operating loss attributable to the Montgomery store, including
buying and distribution costs, was approximately $338,000 or $.06
per share. The Company plans to transfer the inventory, furniture
and fixtures in the Montgomery store to other Solo Serve stores.
The Company will establish a reserve of approximately $300,000 to
$500,000 during the second quarter of 1995 for estimated closing
costs associated with the Montgomery store. The provision will be
established to cover leasehold and other write-offs, inventory
adjustments, and employee costs, excluding the impact of any claim
arising from the rejection of the store lease which may be allowed
by the Bankruptcy Court.
The Company also reported that on May 17, 1995, the United
States Bankruptcy Court for the Western District of Texas entered an
order approving the Company's proposed Disclosure Statement
describing the terms of its Plan of Reorganization, as amended (the
"Plan"). The amended Plan provides for a $2.5 million equity
infusion by General Atlantic Corporation, the Company's principal
stockholder, and a distribution to unsecured creditors of $.725 per
dollar of allowed unsecured claims. Under the Plan, existing
stockholders, other than General Atlantic Corporation, would retain
approximately 66 percent of their current equity ownership
percentage in the post-reorganization equity of the Company,
exclusive of shares reserved for issuance pursuant to stock
incentive plans for senior management and directors. The Plan is
supported by the Official Committee of Unsecured Creditors as well
as by Texas Commerce Bank, N.A., the Company's largest creditor.
In accordance with Bankruptcy Court procedures, the Plan and
Disclosure Statement will be furnished to creditors, stockholders
and other parties in interest for their consideration and vote.
Copies of the Plan, the related Disclosure Statement and ballots
relating to the Plan are currently being distributed to stockholders
of record on May 17, 1995 and creditors of the Company. Ballots are
expected to be due on or before June 26, 1995, and a hearing on
confirmation of the proposed Plan has been scheduled for 9:00 a.m.
on July 6, 1995.
Solo Serve Corporation operates a chain of off-price retail
stores offering a wide selection of name brand and other merchandise
at prices substantially below traditional department and specialty
stores. The Company currently has 29 Solo Serve stores in Texas,
Louisiana and Alabama.
SOLO SERVE CORPORATION
(DEBTOR-IN-POSSESSION)
CONDENSED BALANCE SHEET
(unaudited)
April 29, April 28,
1995 1994
($ in thousands)
Assets
Current Assets:
Cash and time deposits $ 9,790 $ 931
Inventory 22,291 25,619
Other current assets 2,151 6,883
Total current assets 34,232 33,433
Property and equipment, net 17,387 25,664
Goodwill and service marks, net 500 625
Deferred income taxes, net -- 1,770
Receivable from factors 1,590 --
Total Assets $ 53,709 $ 61,492
Liabilities and Stockholders' Equity
Liabilities not subject to compromise:
Current liabilities:
Current portion of
long-term debt $ -- $ 2,487
Accounts payable and
accrued expenses 11,015 14,050
Total current liabilities 11,015 16,537
Long-term debt 5 18,497
Post-retirement benefit obligation 501 414
Liabilities subject to compromise 32,680 --
Total Liabilities 44,201 35,448
Total Stockholders' Equity 9,508 26,044
Total Liabilities and
Stockholders' Equity $ 53,709 $ 61,492
SOLO SERVE CORPORATION
(DEBTOR-IN-POSSESSION)
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
Thirteen Weeks Ended
April 29, April 28,
1995 1994
($ in thousands, except per share amounts)
Net sales $ 25,176 $ 38,166
Cost of goods sold (including
buying and distribution,
excluding depreciation
shown below) 19,094 26,838
Gross Profit 6,082 11,328
Selling, general, and
administrative expenses 7,427 11,523
Depreciation and amortization
expense 757 1,094
Operating Loss (2,102) (1,289)
Interest expense 165 352
Loss before reorganization
items and taxes (2,267) (1,641)
Reorganization items 373 --
Loss before income taxes (2,640) (1,641)
Provision for income taxes -- --
Net Loss $ (2,640) $ (1,641)
Net Loss per common share $ (.46) $ (.29)
Weighted average common
shares outstanding 5,699,734 5,747,502
-0- 6/1/95
/CONTACT: Timothy L. Grady of Solo Serve Corporation, 210-662-6262/
(AMER-GAMING-&-ENTERTNMNT)(AGEL) American Gaming & Entertainment
makes announcement
ATLANTIC CITY, N.J.--June 2, 1995--American Gaming
& Entertainment, Ltd. (OTC:"AGEL") announced that
American Gaming
and Resorts of Mississippi Inc. (formerly known as American Gaming
Corporation) ("AGRM"), a wholly owned subsidiary of AGEL, has filed
a voluntary petition for reorganization under Chapter 11 of the U.S.
Bankruptcy Code with the U.S. Bankruptcy Court, Southern District of
Mississippi.
AGRM owns and leases property in Vicksburg, Miss. which could be
utilized as a possible casino site.
CONTACT: American Gaming & Entertainment, Atlantic City
Alfred J. Luciani, 609/272-7700
NATURE'S ELEMENTS HOLDING CORPORATION RELEASES FIRST QUARTER
RESULTS
EDGEWATER, N.J.--June 2, 1995--Nature's
Elements Holding
Corporation (NELMQ) announced today that Net Sales for the three
months ended April 29, 1995, were $3,305,000 compared to $2,032,000
in the first quarter of 1994. Comparable store sales increased 2%
for the same period. While Direct Store Expense increased to
$2,587,000 (78% of sales) from $1,498,000 (74% of sales), expense
per store week declined 12% to $3,981. General and administrative
expenses declined from $699,000 to $593,000 in the comparable
period. As a percent of sales, general and administrative expenses
declined by 48% from 34% to 18%. The above reductions reflect the
cost control measures implemented in the fourth quarter of 1994.
While operating loss increased to $870,000 from $838,000 in the
comparable period, the loss per average store week declined 46% to
$1,338 from $2,473 in the comparable period. After accounting for
interest income and expense, a $635,000 recapitalization charge in
last year's first quarter and dividends on preferred stock, the net
loss applicable to shareholders of common stock decreased from
$1,546,000, or $0.39 per share to $927,000, or $0.15 per share.
The company was operating 50 stores at April 29, 1995 compared to 26
at April 30, 1994.
As announced earlier, the company filed for protection under
Chapter 11 of the Bankruptcy Code on April 3, 1995. As part of the
options available to the company under the Code, it elected not to
open seven (7) stores for which leases had been signed in 1994.
Currently, the company does not anticipate opening any new stores
during 1995.
/CONTACT: Rocky Smith, Senior Vice President-CFO of Nature's
Elements, 201-945-2640/
BANKRUPTCY COURT HEARING POSTPONED; EPE/PUCT ENTER INTO STIPULATED
AGREEMENT
EL PASO, Texas--June 2, 1995--The hearing before Federal
Bankruptcy Judge Frank Monroe on El Paso
Electric's preliminary
injunction request against the Public Utility Commission of Texas
(PUCT) scheduled for June 5, 1995, has been postponed by joint
agreement between El Paso Electric (EPE) and the PUCT until a later
date if necessary.
EPE announced today it has filed a motion in U.S. Bankruptcy
Court for the Western District of Texas in Austin to approve a
stipulated agreement with the PUCT which will result in the
Commission once again placing Docket 12700 on its final order
meeting agenda, for June 21, 1995, to be continued, if necessary on
July 19, 1995. The stipulation was agreed to by EPE and the PUCT
and filed with the Court on June 1, 1995.
On June 5, 1995, the Court was to hold a hearing on a request
made by El Paso Electric on May 11, 1995, which asked the Court to
enter an injunction prohibiting the PUCT from entering an order
inconsistent with the terms and provisions of the Court's
Confirmation order and Confirmation Findings, including failing to
provide EPE recovery of 100 percent of its Palo Verde Unit 3 cost in
rates without further proof as to the prudent investment in or the
used and useful character of that property pursuant to an annual
inventory plan adopted in Docket 9945.
The PUCT had postponed hearings on El Paso Electric and Central
and South West's rate and merger case on may 16, after EPE had made
its filing for the temporary restraining order in Bankruptcy Court.
EPE filed a voluntary petition under Chapter 11 of the United
States Bankruptcy Code on Jan. 8, 1992, and on Dec. 8, 1993, the
Bankruptcy Court confirmed a plan of reorganization. The plan,
which provides for the acquisition of EPE by Central and South West
Corporation (CSW), a registered public utility holding company based
in Dallas, Texas, will not become effective until regulatory
approvals are obtained and other conditions are satisfied.
/CONTACT: National and regional media: Alan Lee Bunnell, corporate
spokesperson, for El Paso Electric, 915-543-5823; or Local media:
Henry
Quintana Jr., supervisor of corporate communications, 915-543-5824;
or
Financial analysts: John Droubay, treasurer, 915-543-5710; or
Stockbrokers and shareholders: Office of the Secretary, 800-592-1634
or
800-351-1621, all of El Paso Electric/