BALA CYNWYD, Pa. -- May 23, 1996 -- Holly Products
Inc. (NASDAQ:HOPR, HOPRW, AND HOPRR; BSE:HOP, HOPP) announced today
that the U.S. Bankruptcy Court, District of Colorado, has granted
the company's subsidiary, Country
World Casino Inc.'s motion to
extend the time to close on its previously approved $5,000,000
financing package.
The court gave Country World until June 17, 1996 to close on the
financing and resolve all disputes concerning prior secured and
unsecured debt.
The purpose for the extension was to allow Country World the
necessary time to resolve certain title issues and to replace one of
the lenders associated with the financing.
Holly Products' chairman has committed over $2,000,000 of his
personal funds to replace such lenders. Accordingly, the chairman's
loan, combined with the loan from Kennedy Funding Inc. will be
sufficient to complete the court approved financing on a timely
basis. Closing is scheduled for early June.
William Patrowicz, president of Holly Products Inc. stated,
"Again, our chairman has stepped up to the plate to do what is best
for the company. His support at this crucial time will ensure a
speedy resolve to the bankruptcy issues and allow us to get on with
the building of the casino."
Holly Products Inc. headquartered in Bala Cynwyd, Pa., has a
wholly owned subsidiary, Navtech Industries Inc. of Blanding, Utah,
and a majority owned subsidiary, Country World Casinos Inc., of
Denver. Navtech is a manufacturer and tester of electronic
components for casino equipment, hotel equipment, and signage.
Country World Casinos Inc. is a development corporation, whose plan
is to construct a casino in Black Hawk, Colorado, as well as a hotel
complex.
CONTACT: Martin E. Janis & Co. Inc., Chicago
Elliott Jacobson, 312/943-1100
WAYNE, N.J. -- May 23, 1996 -- The
Grand Union
Company announced that sales for the 12 week (the 'fourth
quarter')
and 52 week (the 'fiscal year') periods ended March 30, 1996 totaled
$519.9 million and $2,307.8 million, respectively, compared to
$524.1 million and $2,391.7 million for the 12 week and 52 week
periods ended April 1, 1995.
Same store sales increased 0.4% for the fourth quarter, while
declining 0.9% for the fiscal year.
EBITDA totaled $35.9 million, or 6.9% of sales, and $144.3
million, or 6.3% of sales for the fourth quarter and the fiscal
year, respectively, compared to $14.9 million, or 2.8% of sales, and
$135.6 million, or 5.7% of sales for the comparable periods of the
prior year.
Roger E. Stangeland, Chairman of the Board, said that he was
especially pleased with the actions management has taken this year,
working jointly with the Board, to develop a dynamic, customer
focused strategic plan designed for long-term growth. "Grand Union
is in the process of implementing its strategy which has two primary
objectives," Stangeland said. "First, the company is committed to
building sales by reducing costs in areas the customer doesn't see
and reinvesting those savings in areas the customer sees every day.
Secondly, Grand Union will focus much of its attention on developing
even further the strengths it currently has in perishable and
service department merchandising."
Stangeland said that he was encouraged with the modest same
store sales increases for the fourth quarter, only the second
quarterly increase since the first quarter of fiscal 1992. "The
progress in same store sales this year, culminating in the positive
fourth quarter comparison, demonstrates that our strategy is on
target with the customer."
Joseph J. McCaig, president and chief executive officer, said,
"During the past year we made a number of important and positive
changes in the way we operate our business under the two main
headings of our strategic plan. To reduce costs the customer
doesn't see, we closed three distribution centers and entered into
agreements with C&S Wholesale Grocers to supply product to our
stores. Additionally, we completed the store voluntary resignation
incentive programs which reduced average hourly pay. Finally, we
made our organizational structure more effective by eliminating
costly redundant regional organizations, centralizing store support
services and decentralizing operational control over stores."
"We reinvested those savings in programs the customer sees every
day," McCaig said. "We repositioned the pricing in most of our
stores and implemented exciting new marketing and customer service
programs in select areas which emphasize our perishables
merchandising strengths."
McCaig went on to say, "During the fourth quarter we completed
the renovation of two stores, West Nyack and Monroe, NY, which are
the first stores to completely incorporate the concepts of our
'MASTERS' (Maximize All Space, Totally Expand the Right Stuff)
strategy. The total sales increases and favorable mix changes in
both of these stores have met or exceeded our expectations. During
the fourth quarter, we also completed an enlargement of our Lake
Placid, NY store and acquired a store in Millerton, NY."
The company reported that total chain sales declined during this
year's fourth quarter and fiscal year compared to the same periods
of the prior year as a result of the sale or closure of 24 stores
last year which were not replaced, partially offset by the effects
of incremental new stores. Additionally, as noted above, same store
sales increased for the fourth quarter and declined for the fiscal
year.
The same store sales increase for the fourth quarter of 0.4%
principally resulted from the positive impact of the 'More Lower
Prices' price repositioning program implemented in most of the
company's stores during the year, additional marketing and customer
service programs introduced this year in the metropolitan Albany, NY
and Bergen County, NJ areas and minor effects of the bankruptcy
proceedings on last year's sales. In addition, the fiscal year was
positively impacted by the severe snowstorms which struck the New
York metropolitan area in late December and early January and
negatively impacted by strong promotional programs during last
year's second and third quarters and the effects of closing the
company's two New York metropolitan area distribution centers.
EBITDA (earnings before LIFO provision, depreciation,
amortization, unusual items, interest expense, income taxes and
extraordinary gain) for the fourth quarter and the fiscal year, as a
percentage of sales, was positively influenced by the savings
generated by closing three distribution centers and entering into
agreements with C&S Wholesale Grocers Inc. to supply product to
Grand Union's stores, by the restoration this year of vendor
promotional allowances and other vendor support which were not
available to the company during the bankruptcy process last year and
by gains from the sale of stores ($1.5 million for the quarter and
$5.4 million for the fiscal year compared to none and $2.5 million
for the same periods of the prior year). EBITDA was negatively
influenced, as a percentage of sales, by reduced gross margins and
increased advertising costs associated with the price repositioning
program and increased store labor principally related to the
company's metropolitan Albany and Bergen County marketing programs.
In addition to the two 'MASTERS' renovations, the company opened
two new and two replacement stores and completed three enlargements
and four major renovations this year. Capital spending for the
fiscal year, including capitalized leases other than real estate
leases, totaled $46 million. The company anticipates capital
spending of $45 to $50 million during fiscal 1997. Grand Union
currently has under construction three replacement stores in Malta
and Niskayuna, NY and Dumont, NJ, and a new store in Berlin, VT.
The company reported a net loss of $29.3 million for the fourth
quarter ($2.93 per share). Included in the loss was a provision of
$2.5 million relating to Grand Union's organizational restucturing.
The Company's loss for the fourth quarter before amortization of
excess reorganization value was $4.7 million ($.47 per share). Net
income for the fiscal year totaled $715.6 million and included an
extraordinary gain on debt discharge of $854.8 million.
Grand Union emerged from bankruptcy on June 15, 1995, whereupon
it adopted "fresh-start" reporting in accordance with American
Institute of Certified Public Accountants Statement of Position 90-
7, "Financial Reporting by Entities in Reorganization under the
Bankruptcy Code." Adoption of fresh-start reporting resulted in an
adjustment of the basis of assets, liabilities and equity to their
respective fair values. Under fresh-start reporting, the company is
required to separate the results of its pre emergence operations
from its post-emergence operations. Accordingly, pre-emergance
periods are not comparable with post-emergance periods. The company
has combined the pre-emergence and post-emergence operations for
press release purposes and, because of the lack of comparability of
net earnings, the company has chosen to discuss Sales and EBITDA
since these measures are generally unaffected by the restructuring.
Grand Union is a regional retail food company which currently
operates 229 retail food stores in six Northeastern states. Its
common stock is traded under the GUCO symbol on the NASDAQ National
Market.
THE GRAND UNION COMPANY
CONSOLIDATED STATEMENT OF OPERATIONS
(unaudited)
(in thousands of dollars)
12 Weeks Ended 52 Weeks Ended
March 30, April 1, March 30, April 1,
1996 1995 1996 1995
Sales $ 519,937 $ 524,060 $2,307,810 $2,391,696
Gross profit (a) 168,076 150,302 715,497 707,231
Operating and
administrative
expense (a) (132,161) (135,390) (571,164)
(571,640)
Earnings before LIFO
provision, depreciation,
amortization, unusual
items, interest expense,
income tax benefit and
extraordinary gain on
debt discharge
(EBITDA) 35,915 14,912 144,333 135,591
LIFO provision (800) 1,860 (1,800) 1,110
Depreciation and
amortization (19,336) (19,874) (77,055)
(87,098)
Amortization of excess
reorganization value (24,580) -- (83,985) --
Unusual items (b) (2,500) (14,905) (40,627)
(27,417)
Earnings (loss) before
interest expense,
income tax benefit and
extraordinary gain on
debt discharge (11,301) (18,007) (59,134) 22,186
Interest expense (23,678) (27,858) (98,985)
(182,016)
Loss before income
tax benefit and
extraordinary gain
on debt discharge (34,979) (45,865) (158,119)
(159,830)
Income tax benefit 5,715 -- 18,927 --
Loss before
extraordinary gain
on debt discharge (29,264) (45,865) (139,192)
(159,830)
Extraordinary gain
on debt discharge -- -- 854,785 --
Net income (loss) (29,264) (45,865) 715,593
(159,830)
Accrued preferred
stock dividends -- (1,307)
-- (19,480)
Net income (loss)
applicable to
common stock $ (29,264) $ (47,172) $ 715,593 $
(179,310)
(b) Unusual items consist of (i) a $2,500 provision related to
organizational restructuring for the 12 and 52 weeks ended March 30,
1996, (ii) a $3,747 charge related to pension settlements and early
retirement programs for the 12 and 52 weeks ended April 1, 1995,
(iii) a $8,888 and $10,770 charge for reorganization expenses for
the 12 and 52 weeks ended April 1, 1995, respectively, (iv), a
$2,270 and $12,900 provision for store closures for the 12 and 52
weeks ended April 1, 1995, respectively, (v) a $15,000 warehouse
closure provision for the 52 weeks ended March 30, 1996 (vii)
$18,627 of reorganization expense for the 52 weeks ended March 30,
1996, and (viii) a $4,500 provision for voluntary resignation
incentives for the 52 weeks ended March 30, 1996.
CONTACT: Grand Union, Wayne
Donald C. Vaillancourt, 201/890-6100
CHATSWORTH, Calif. -- May 23, 1996 -- ChatCom Inc.
(NASDAQ: CHAT) announced Thursday the completion of a Regulation D
6% convertible preferred stock offering totaling $3.0 million.
The company is in the process of registering with the Securities
and Exchange Commission the common stock which may be issued upon
the conversion or redemption of the preferred stock.
James Mariner, president and CEO, reports that the proceeds
replace debt and provide for additional working capital. "The
company is now debt free with a strong balance sheet to support the
product positioning the company is undertaking in the market place."
Mariner further stated: "The company expects to report a loss
for the year ended March 31, 1996 of approximately $2 million
(including $320,000 for a restructuring charge), which approximates
the loss for the prior fiscal year.
"During the fourth quarter, the company experienced a
significant drop in revenues. The company believes that the drop in
revenues was in part attributable to decreased government revenues.
The decline is also associated with cash shortages the company
experienced during the third and fourth quarter which restricted
advertising and marketing for those periods, both vital for revenue
generation.
"Advertising and marketing have been restarted with a brand new
vigor and orders for new products during the company's current
quarter are very encouraging. The performance of the ChatTwin (a
single slot board with dual independent processors and disk drives)
already installed at U.S. Robotics, our launch customer, combined
with other new products to be released in June, will make our
company a strong contender everywhere a high density, high
availability global information systems platform is required."
CONTACT: ChatCom Inc. -
James B. Mariner/John R. Grady, 818/709-1778
NEW YORK, May 23, 1996 - Keene
Corporation (OTC Bulletin
Board: KEENQ) today announced that each voting class of its
creditors and its stockholders has voted to accept Keene
Corporation's Fourth Amended Plan of Reorganization, dated March 11,
1996 (the "Plan"). In addition, asbestos-related creditors voted to
accept the Plan in a majority sufficient to meet the requirements
for the issuance of a Permanent Channeling Injunction under Section
524(g) of the Bankruptcy Code. The Bankruptcy Court has scheduled a
confirmation hearing for June 12, 1996.
CONTACT: Janice B. Grubin of Berlack, Israels & Liberman, LLP,
212-704-0100
SHERMAN OAKS, Calif., May 23, 1996 - href="chap11.hf.html">House of Fabrics,
Inc. (NYSE: HF) announced today that it has obtained a commitment
for $60 million in financing from The CIT Group. The new financing
becomes effective at the end of July, when the company anticipates
that it will successfully complete its restructuring and emerge from
Chapter 11.
Under the terms of the new financing agreement, The CIT Group
will provide a $60 million revolving line of credit for an initial
period of three-years. The financing is part of the company's
revised plan of reorganization, which has the support of the
company's major constituencies, including its bank group, led by
Bank America as agent, and the official committees of unsecured
creditors and equity holders.
"With this new financing, we are confident that House of Fabrics
will be successful in its timely emergence from Chapter 11," said
Gary L. Larkins, president and chief executive officer of House of
Fabrics.
"We are extremely pleased with the terms of the facility CIT has
agreed to," said Mr. Larkins. "The new financing, in combination
with recent reductions in company debt, provides the liquidity and
operating options the company needs to continue to rebuild and
revitalize its business."
Freddie Reiss, managing partner and head of the restructuring
practice of Price Waterhouse LLP, who serves as financial advisor
for the official committee representing the company's unsecured
creditors, said, "The new financing supports the company's
consensual Plan of Reorganization and provides House of Fabrics with
the opportunity to emerge from Chapter 11 with a fresh, new start."
A hearing will be held later today to consider the proposed
disclosure statement for the plan. The acceptance of the disclosure
statement by the Bankruptcy Court will pave the way for the company
to begin solicitation of creditors and equity holders for approval
of the plan.
House of Fabrics filed to restructure under Chapter 11 on
November 2, 1994.
CONTACT: Sandra Sternberg or Rivian Bell, both of Sitrick and
Company, 310-788-2850