Bradlees Reports Improved
Second-Quarter Results
BRAINTREE, Mass., Aug. 20, 1997 -
significantly reduced operating and net losses for the second
quarter (13 weeks) ended August 2, 1997, compared with the second
quarter (13 weeks) ended August 3, 1996.
Bradlees reported a second-quarter loss before interest and
reorganization items of $11.1 million, compared with a loss of
$39.4 million last year. The EBITDA (earnings before interest,
taxes, depreciation and amortization, and net restructuring
payments) loss was $2.0 million, compared with an EBITDA loss of
$23.1 million in the prior-year period. The net loss was $16.9
million, or $1.48 per share, compared with a net loss of $82.8
million, or $7.25 per share, last year. Last year's results
included charges totalling $45.8 million primarily associated
with 14 closing stores of which $39.9 million was classified as
reorganization items and the remainder included in cost of goods
sold.
The loss before interest and reorganization items was $37.1
million for the 26 weeks ended August 3, 1997, compared with
$83.1 million last year. The EBITDA loss was $18.6 million,
compared with an EBITDA loss of $55.8 million in the prior-year
period. The year-to-date net loss was $48.8 million, or $4.29 per
share, compared with a net loss of $136.5 million, or $11.96 per
share, last year.
Total sales for the second quarter were $311.5 million,
compared with $386.2 million, reflecting the closing of 15 stores
since the end of last year's second quarter (12 stores were
closed during last year's second quarter), and a
comparable-store sales decline of 7.3 percent, reflecting, in
part, the continued de- emphasis of the aggressive promotional
activity of last year. Total sales for the year-to-date period
were $588.3 million, compared with $736.1 million last year,
reflecting the closing of 27 stores since the beginning of last
year's second quarter, and a comparable-store sales decline of
6.9 percent.
Peter Thorner, Chairman and Chief Executive Officer, said,
"Entering the busiest selling period of the year, we are
halfway to the year-over-year EBITDA improvement of $76 million
forecasted in our 1997 business plan. This significant
improvement in operational results is a result of management's
focus on improving gross margin rates and reducing expenses.
"We are continuing to make modifications to Bradlees'
marketing strategy, merchandising mix and presentation. Among
these changes are the gradual re-establishment of lower opening
price points in selective merchandise categories, and the
increase in the item intensity and price-point orientation of the
weekly advertising circulars. We have also seen immediate
positive customer response to the reintroduction of certain basic
health, beauty, convenience and commodity items - which customers
expect to be carried by discount stores. Additionally, initial
results from the late-July reinstatement of the layaway program
are very encouraging," Mr. Thorner said. "We anticipate
that the implementation of these and other evolutionary changes
during the coming months will lead to improved sales performance
by enhancing customer awareness of the quality and value of
Bradlees' merchandise offerings, while increasing customer
traffic and avoiding costly promotions," Mr. Thorner said.
Bradlees operates 109 stores in seven Northeastern states and
is one of the nation's largest discount retailers with annual
total sales of more than $1.5 billion.
BRADLEES,
INC.
(Operating as
Debtor-In-Possession)
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars in thousands except
per share amounts)
13 Weeks ended
26
Weeks
ended
Aug. 2, 1997 Aug. 3,
1996 Aug. 2, 1997
Aug. 3, 1996
Total sales $311,507 $386,195
$588,346
$736,086
Leased sales l4,091 16,617
23,559
28,805
Net sales 297,416 369,578
564,787
707,281
Cost of goods sold 204,480 268,182
392,192
503,371
Gross margin 92,936 101,396
172,595
203,910
Leased department and
other operating income 3,l45 3,931
5,440
6,957
96,081 105,327
178,035
210,867
Selling, store operating,
administrative and
distribution expenses 98,134 134,281
196,869
272,497
Depreciation and
amortization expense 9,038 10,459
l8,222
21,476
Loss before interest and
reorganization items(11,091) (39,413)
(37,056)
(83,106)
Interest and
debt expense 3,702 2,444
6,983
4,959
Reorganization items 2,071 40,928
4,818
48,466
Net loss ($16,864) ($82,785)
($48,857)
($136,531)
Net loss per share ($1.48) ($7.25)
($4.29)
($11.96)
BRADLEES INC. AND
SUBSIDIARIES
(Operating as
Debtor-In-Possession)
CONDENSED CONSOLIDATED
BALANCE SHEETS
(Unaudited)
(Dollars in
thousands)
ASSETS
8/2/97
2/1/97 8/3/96
Current assets:
Unrestricted cash and cash equivalents
$10,858 $10,025
$17,318
Restricted cash and cash equivalents
9,334 9,126
7,350
Total cash and cash equivalents
20,192 19,151
24,668
Accounts receivable
10,453 8,240
13,737
Inventories
253,993 236,920
256,402
Prepaid expenses
8,887 8,466
9,709
Assets held for sale
7,754 8,419
8,954
Total current assets
301,279 281,196
313,470
Property excluding capital leases, net
136,975 139,246
145,567
Property under capital leases, net
22,681 24,395
30,118
Total property, plant and equipment, net
159,656 163,641
175,685
Lease interests at fair value and lease
acquisition costs, net
146,570 150,229
182,042
Assets held for sale
5,250 5,250
10,153
Other, net
4,432 3,884
3,757
Total other assets
156,252 159,363
195,952
Total Assets
$617,187 $604,200
$685,107
BRADLEES, INC. AND
SUBSIDIARIES
(Operating as
Debtor-In-Possession)
CONDENSED CONSOLIDATED
BALANCE SHEETS
(Unaudited)
(Dollars in
thousands)
LIABILITIES AND
STOCKHOLDERS' EQUITY (DEFICIENCY)
8/2/97 2/1/97
8/3/96
Current liabilities:
Accounts payable
$139,410 $115,315
$147,216
Accrued expenses
41,389 45,924
40,736
Short-term debt
89,000 42,500
---
Self-insurance reserves
7,378 7,086
8,511
Current portion of capital
lease obligations
1,966 1,722
2,226
Total current liabilities
279,143 212,547
198,689
Long-term liabilities:
Obligations under capital leases
32,224 33,296
48,069
Deferred income taxes
8,581 8,581
8,581
Self-insurance reserves
14,979 14,386
17,024
Other long-term liabilities
26,976 27,642
24,095
Total long-term liabilities
82,760 83,905
97,769
Liabilities subject to settlement under
the reorganization case
567,365 571,041
569,955
Stockholders equity (deficiency):
Common stock
Par value
115 115
115
Additional paid-in capital
137,951 137,951
137,951
Unearned compensation
--- (167)
(420)
Accumulated deficit
(449,382) (400,525)
(318,297)
Treasury stock, at cost
(765) (667)
(655)
Total stockholders' deficiency
(312,081) (263,293)
(181,306)
Total Liabilities and Stockholders'
Deficiency
$617,187 $604,200
$685,107
SOURCE Bradlees, Inc. /CONTACT: Bill Roberts of Bradlees,
617-380-8354/
Grossman's Releases Second Quarter
Results and Balance Sheets
CANTON, Mass.---Aug. 20, 1997--Grossman's
Inc. (NASDAQ:GROSQ) released consolidated balance sheets as
of June 30, 1997 and statements of operations for the three
months and six months ended June 30, 1997. The Company reported a
net loss for the 1997 second quarter of $7.6 million versus a net
loss of $2.9 million in the second quarter of 1996. The net loss
per share in the second quarter of 1997 was 27 cents versus a net
loss per share of 11 cents in 1996.
For the six month period ended June 30, 1997, the Company
reported a net loss of $19.6 million, or 70 cents per share,
versus a net loss of $57.6 million, or $2.21 per share, in 1996.
The 1996 results include a first quarter restructuring charge of
$40.2 million.
Sales from ongoing operations for the three months ended June
1997 totalled $55.7 million, 36.5% below the $87.7 million for
the same period in 1996. Comparable store sales for the second
quarter were 37.7% below the 1996 level.
Sales from ongoing operations for the six months ended June
1997 totalled $105.1 million, 31.3% below the $152.7 million for
the same period in 1996. Comparable store sales for the six month
period were 34.0% below the 1996 level.
Statements contained in this release that are not based on
historical fact are "forward-looking" statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Important factors, beyond the company's control, that could
cause actual results to differ materially from those in the
forward-looking statements include, but are not limited to, the
need for approvals by the Bankruptcy Court, competition,
stability of customer demand, and the sufficiency of its capital
resources. Undue reliance should not be placed on these forward
looking statements, which speak only as of the date hereof. The
company undertakes no obligation to publicly release revisions to
these forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence
of unanticipated events.
Grossman's operates 15 stores under the name Contractors'
Warehouse in California, Indiana, Kentucky and Ohio, and 28
stores under the name Mr. 2nd's Bargain Outlet in Massachusetts,
New York and Rhode Island.
Grossman's Inc. press releases and public filings can be
accessed on the Internet through Business Wire's Home Page:
http://www.businesswire.com/cnn/gros.htm
The Bargain Outlet Division maintains a web site for product
information, store locations and feedback:
http://www.bargain-outlets.com
GROSSMAN'S INC. AND
SUBSIDIARIES
(DEBTOR-IN-POSSESSION
)
CONSOLIDATED BALANCE
SHEETS
(in thousands, except per
share data)
(Unaudited)
JUNE 30,
DECEMBER
31, JUNE
30,
1997
1996
1996
--------
----------
-
---------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 128
$ 1,058 $ 679 Receivables, less
allowance of
$2,209 at June 30, 1997
$2,810 at December 31, 1996
and $745 at June 30, 1996 3,050
10,710 14,548
Inventories 59,922
56,662 61,229 Property held for sale
8,819 15,199 4,802 Other
current assets 2,464
1,559 3,884
--------
--------
--------
Total current assets 74,383
85,188 85,142
PROPERTY, PLANT AND EQUIPMENT,
net of accumulated depreciation
of $17,416 at June 30, 1997,
$16,114 at December 31, 1996
and $15,220 on June 30, 1996 23,035
25,549 30,324
PROPERTY HELD FOR SALE -
- 38,232 PREPAID PENSION ASSET
9,691 9,536 125 OTHER
ASSETS 3,109
3,168 927
--------
--------
--------
TOTAL ASSETS $110,218
$123,441 $154,750
-0-
GROSSMAN'S INC. AND
SUBSIDIARIES
(DEBTOR-IN-POSSESSION
)
CONSOLIDATED BALANCE
SHEETS
(in thousands, except per
share data)
(Unaudited)
JUNE 30,
DECEMBER 31,
JUNE
30,
1997
1996
1996
--------
--------
--------
LIABILITIES AND STOCKHOLDERS
INVESTMENT
CURRENT LIABILITIES
Accounts payable and accrued
liabilities $ 25,630
$ 60,229 $ 71,444
Liabilities subject to Compromise 46,202
-- -- Accrued interest
500 397 410
Revolving term note payable 32,443
30,024 -- Current portion of long-term
debt
and capital lease obligations 2,860
12,228 7,095
--------
--------
--------
Total current liabilities 107,635
102,878 78,949
REVOLVING TERM NOTE PAYABLE --
-- 20,310
LONG-TERM DEBT AND CAPITAL LEASE
OBLIGATIONS 140
634 22,117
PENSION LIABILITY --
-- 8,247
OTHER LIABILITIES 9,173
7,241 8,390
--------
--------
--------
Total liabilities 116,948
110,753 138,013
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' INVESTMENT
Common stock, $.01 par value,
Shares authorized - 50,000
Shares issued - 28,000 in 1997,
27,676 at December 31, 1996 and
26,519 at June 30, 1996 281
277 265
Additional paid-in-capital 157,992
157,825 156,229
Retained earnings (deficit) (165,003)
(145,414) (121,839) Minimum pension liability
-- -- (16,476)
Cumulative foreign currency
translation adjustment
-- -- (1,442)
--------
--------
--------
Total Stockholders'
Investment (6,730)
12,688 16,737
--------
--------
--------
TOTAL LIABILITIES AND
STOCKHOLDERS'
INVESTMENT $110,218
$123,441 $154,750
-0-
GROSSMAN'S INC. AND
SUBSIDIARIES
(DEBTOR-IN-POSSESS
ION)
CONSOLIDATED STATEMENTS OF
OPERATIONS (in thousands,
except per share data)
(Unaudited)
THREE MONTHS
SIX
MONTHS ENDED
JUNE 30,
ENDED JUNE 30,
----------------
-
----------------
-
1997 1996
1997
1996 ----
---- ----
----
SALES $ 55,749 $ 87,704
$105,124 $200,685 COST OF SALES
42,479 66,833 81,986 153,844
-------- --------
-------- --------
Gross Profit 13,270 20,871
23,138
46,841
OPERATING EXPENSES
Selling and
administration 18,386 22,929
39,250
60,963
Depreciation and
amortization 949
997 1,971 2,846
Store closing expense
- - - 40,150
Preopening expense 64 395
198
756
-------- --------
-------- --------
19,399
24,321
41,419
104,715
--------
--------
--------
--------
OPERATING (LOSS) (6,129) (3,450)
(18,281) (57,874)
OTHER EXPENSES (INCOME)
Interest expense 712 1,016
1,399
2,636
Net gain on disposals of
property
- - - (27)
Other (1,595) (1,628)
(2,413)
(3,166)
--------
--------
--------
--------
(883) (612)
(1,014)
(557)
EQUITY IN NET LOSS OF
UNCONSOLIDATED AFFILIATE - 108
- 316
--------
--------
--------
--------
(LOSS) BEFORE REORGANIZATION
ITEMS AND INCOME TAXES (5,246) (2,946)
(17,267)
(57,633)
REORGANIZATION ITEMS 2,322 -
2,322 -
-------- --------
-------- --------
(LOSS) BEFORE INCOME TAXES (7,568) (2,946)
(19,589) (57,633) PROVISION FOR INCOME TAXES
- - - -
--------
--------
--------
--------
NET (LOSS) $ (7,568) $ (2,946)
$(19,589) $(57,633)
NET (LOSS) PER COMMON SHARE
(PRIMARY) $(0.27) $(0.11)
$(0.70)
$(2.21)
WEIGHTED AVERAGE SHARES AND
EQUIVALENT SHARES OUTSTANDING
(Primary) 28,024 26,458
27,941
26,276
CONTACT: Grossman's Inc. Arthur S. Ryan (617) 830-4081
Jayhawk Acceptance Corporation Announces
Filing of Joint Plan of Reorganization
DALLAS, TX - Aug. 20, 1997 - Jayhawk
Acceptance Corporation (Nasdaq: JACCQ) today stated that as a
result of its previously announced discussions with the Official
Committee of Unsecured Creditors in its Chapter 11 Case, a Joint
Plan of Reorganization proposed by both the Company and the
Committee has been filed. The U. S. Bankruptcy Court for the
Northern District of Texas, at Dallas has approved a disclosure
statement relating to the Joint Plan, and the Company will begin
soliciting votes on the Joint Plan in the next few days. The
Bankruptcy Court has scheduled a hearing to consider confirmation
of the Joint Plan for September 29, 1997. Although discussions
are continuing with its secured lender and other necessary
parties, the Company anticipates it will reach agreement with
such parties to support the Joint Plan.
Except for the historical information contained herein, the
matters discussed in this press release, including the matters
relating to the Joint Plan and any beliefs with respect thereto,
are forward looking statements that are dependent upon a number
of risks and uncertainties that could cause actual results to
differ materially. These risks and uncertainties include the
unpredictability of the results of legal proceedings and
negotiations, and the risk factors identified in the Company's
SEC filings. The Company does not intend to provide updated
information about the matters referred to in these forward
looking statements, other than in the context of management's
discussion and analysis in the Company's quarterly and annual
reports on Form 10-Q and 10-K.
Jayhawk Acceptance Corporation is a specialized financial
services company headquartered in Dallas, Texas.
SOURCE Jayhawk Acceptance Corporation /CONTACT: Virginia L.
Cleveland of Jayhawk Acceptance Corporation, 214-754-1016/
LOT$OFF Corporation Announces Planned
Store Conversions
SAN ANTONIO, TX - Aug. 20, 1997 - San Antonio-based LOT$OFF
Corporation (OTC Bulletin Board: LOTS, LOTSP) announced today
that it was proceeding with its previously announced store
conversion program, from an off-price ("50-OFF") to a
close-out ("LOT$OFF") retailing concept, at 17 store
locations in 13 markets. Next week, such conversions will be
implemented at the Company's store locations in Brownsville,
Harlingen, Pharr, McAllen, Roma and Laredo, Texas with
"Grand Re-Openings" scheduled for Saturday, August 30,
and running through Labor Day Weekend. The balance of the
conversions (in Albuquerque, Baton Rouge, Bossier City, El Paso,
Memphis, New Orleans and Shreveport) are scheduled for the week
of September 28 with "Grand Re- Openings" planned for
Saturday, October 4. Upon completion of these conversions, the
Company will have all 41 of its stores (Texas, Louisiana,
Oklahoma, New Mexico and Tennessee) converted to the Company's
new store name ("LOT$OFF") and retailing concept.
Coincident and consistent with the implementation of this
conversion program has been a change in the mix of products
carried in the Company's converted stores, historically a
majority in family apparel, to a majority in non-apparel
merchandise, principally through the addition of new product
categories to the Company's historical non-apparel offerings
which included cosmetics, housewares and giftware, home
furnishings, shelf-stable food products, toys, luggage, footwear,
stationery and health and beauty aids. New categories include
sporting goods, automotive, greeting cards, jewelry, books, party
goods, seasonal items, pet supplies and hardware, among others.
The Company will continue to maintain a healthy showing of basic,
family apparel products in the LOT$OFF stores. The actual
merchandise mix will fluctuate by category, by season and by
store based on customer needs and buying trends, demographics and
the availability of products at close-out prices. This
merchandising concept is designed to appeal to value- conscious
shoppers and other "bargain hunters," and management is
hopeful its implementation will lead to increased store traffic
and improved operating results.
LOT$OFF Corporation (formerly 50-OFF Stores, Inc.), which had
net sales of $22.3 million during the first half of fiscal 1998
while reorganizing in a Chapter 11 bankruptcy, emerged from
bankruptcy on June 16, 1997 and expects a substantial increase in
sales and a return to profitability in its fiscal second half
ending January 30, 1998.
SOURCE LOT$OFF Corporation /CONTACT: Charles Fuhrmann, CEO, of
LOT$OFF Corporation, 210- 804-4904/
Payless Cashways Receives Court Approval
on Permanent DIP Financing
KANSAS CITY, Mo., Aug. 20, 1997 -
(OTC Bulletin Board: PYLSQ) said today that it has received final
Court approval of the Company's $125 million debtor-in-possession
(DIP) financing agreement.
The DIP agreement calls for a group of financial institutions
led by Canadian Imperial Bank of Commerce to provide $125 million
in post-petition financing to Payless Cashways to be used to
purchase merchandise and fund the Company's ongoing operating
needs during the restructuring process. The Company filed its
Chapter 11 petition and plan of reorganization in the U.S.
Bankruptcy Court for the Western District of Missouri in Kansas
City on July 21, 1997.
"The DIP financing agreement will provide more than
adequate financial resources for our merchandising and other
operating requirements as Payless Cashways moves forward in its
restructuring," said David Stanley, chairman and chief
executive officer.
In other action, the Court also approved the Company's
proposed employee retention plan, developed to ensure that
critical employees remain with the Company during its
restructuring. Consideration of a motion by the Company to
establish the procedure for handling reclamation claims was
continued to September 17, 1997 at the request of the Official
Committee of Unsecured Creditors and with the concurrence of
Payless Cashways.
"We continue to make progress on our restructuring
efforts, and with the continued and increasing support of the
Company's suppliers and the hard work of its employees, we are
optimistic Payless Cashways will emerge from the reorganization
process by the end of this year as a stronger, profitable, more
competitive enterprise," Mr. Stanley stated.
Payless Cashways, Inc. is a full-line building materials
specialty retailer concentrating on remodelers, residential and
commercial contractors, property management and industrial firms,
and do-it-yourselfers. The Company currently operates 194
building materials stores in 22 states located in the Midwestern,
Southwestern, Pacific Coast, Rocky Mountain, and New England
areas. The stores operate under the names of Payless Cashways,
Furrow, Lumberjack, Hugh M. Woods, Somerville Lumber, Knox
Lumber, and Contractor Supply. Payless Cashways currently employs
approximately 17,000 people in its stores, headquarters offices
and distribution centers.
This paragraph is included in this release to comply with the
safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. There are certain important factors that
could cause results to differ materially from those anticipated
by the forward- looking statements made above. Investors are
cautioned that all forward-looking statements involve risk and
uncertainty. Among the factors that could cause different results
are: consumer spending and debt levels, interest rates, housing
activity, lumber prices, product mix, growth of certain market
segments, competitor activities, an excess of retail space
devoted to the sale of building materials, success of the Dual
Path strategy, the need for Bankruptcy Court approvals, the
adequacy of and compliance with the DIP financing, stability of
customer demand and supplier support, and the many uncertainties
involved in operating a business in a Chapter 11 bankruptcy
environment. Additional information concerning those and other
factors is contained in the company's SEC filings, copies of
which are available from the Company without charge or on the
Company's web site, payless.cashways.com.
SOURCE Payless Cashways, Inc. /CONTACT: Sandra Sternberg or
Ann Julsen, 816-234-6183, 310- 788-2850, both of Sitrick And
Company/
Tapistron International, Inc. Emerges
from Chapter 11 Bankruptcy
RINGGOLD, Ga.--Aug. 20, 1997--Tapistron International, Inc.
(NASDAQ Bulletin Board: TAPIQ) Tapistron International, Inc.
today announced that the U.S. District Bankruptcy court in
Atlanta confirmed the company's reorganization plan on August 18.
This order clears the way for Tapistron to emerge from Chapter 11
status.
"This is a great day for everyone associated with the
company," declared Darwin Poe, President and Chief Executive
Officer. "We've worked long and hard to put into place a new
financial structure that will allow the company to prosper going
forward. I'm proud of our employees and management team whose
dedication and persistence were principally responsible for this
achievement."
"We are, in addition, particularly thankful to our many
customers, suppliers, and partners around the world who have
supported us during this challenging period and allowed Tapistron
to complete the restructuring in a relatively short amount of
time. We can now focus on objectives that benefit everyone
associated with the company," Poe stated.
Tapistron plans not only to repay 100% of all its debt with
interest but also expects to continue doing business with many of
its present creditors. Poe mentioned that the full repayment of
debt-which was an essential part of the company's long term
strategy of maintaining goodwill and strong relationships-was
enabled by a substantial recapitalization of the company as well
as increased machine sales.
Poe stated, "The CYP technology throughout this period
has not been questioned; in fact, its reputation has grown due to
machine enhancements and close customer relationships. It should
be noted that during the past twelve months more CYP systems were
sold than in any other fiscal year. Continuing sales to carpet
manufacturers worldwide enabled us to maintain our production
operations, and negotiations with new and current customers are
increasing in frequency and providing us with confidence in
another year of exceptional results."
"Today's events are important for two reasons," Poe
concluded. "First, it will bring renewed energy and focus to
serving our customers, who truly believe in our technology.
Second, it better positions us to make investments in new,
complementary products and services. We still have a lot of
opportunities and challenges ahead, and this was an important
step forward."
Tapistron International., Inc. manufactures the unique and
proprietary CYP (Computerized Yarn Placement) Machine for
producing pattern tufted carpets and rugs. Corporate and
manufacturing offices are located in Ringgold, Georgia.
CONTACT: Tapistron International, Inc. Floyd Koegler, Chief
Financial Officer Roger Ensley, Controller 706-965-9300
706-965-9310 fax