Back to GetFilings.com




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 April 23, 2005
 
 
 
OR
 
 
[ ]
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
 
SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to _______.

Commission file number 1-13740

BORDERS GROUP, INC.
(Exact name of registrant as specified in its charter)

MICHIGAN
  
38-3294588
(State or other jurisdiction of
  
(I.R.S. Employer
incorporation or organization)
  
Identification No.)

100 Phoenix Drive, Ann Arbor, Michigan 48108
(Address of principal executive offices)
(zip code)

(734) 477-1100
(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 _  
 
   
Shares Outstanding As of
Title of Class
 
May 20, 2005
Common Stock
 
71,085,811
 
 
 




BORDERS GROUP, INC.

INDEX
         
         
 
    
Page 
  
Part I - Financial Information
        
         
Item 1.    Financial Statements
    
1
  
Item 2.    Management's Discussion and Analysis of
        
        Financial Condition and Results of
        
Operations
    
10
  
Item 3.    Quantitative and Qualitative Disclosures about
        
Market Risk
    
19
  
Item 4.    Controls and Procedures
    
20
  
         
Part II - Other information
        
         
Item 1.    Legal Proceedings
    
20
  
Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds
    
20
  
Item 3.    Defaults Upon Senior Securities
    
N/A
  
Item 4.    Submission of Matters to a Vote of
    
N/A
  
        Securityholders
    
 
Item 5.     Other Information
    
N/A
  
Item 6.     Exhibits
   
21
  
         
Signatures
    
22
  



ii


BORDERS GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(dollars in millions except per share data)
(UNAUDITED)


   
13  Weeks Ended
  
 
      
(Restated)
  
 
 
  
April 23,
2005
  
April 25,
2004
  
Sales
  
$
847.2
  
$
830.8
  
Other revenue
    
5.8
    
7.3
  
Total revenue
    
853.0
    
838.1
  
               
Cost of merchandise sold (includes occupancy)
    
639.2
    
627.8
  
Gross margin
    
213.8
    
210.3
  
               
Selling, general and administrative expenses
    
218.5
    
203.6
  
Pre-opening expense
    
1.2
    
0.7
  
Asset impairments and other writedowns
    
0.3
    
0.4
  
Operating income (loss)
   
(6.2
)
  
5.6
  
               
Interest expense
    
2.2
    
1.9
  
Income (loss) before income tax
    
(8.4
)
  
3.7
  
               
Income tax provision (benefit)
   
(3.1
)
  
1.4
  
Net income (loss)
 
$
(5.3
)
$
2.3
  
               
Earnings (loss) per common share data
              
 Diluted:
              
Income (loss) per common share
  
$
(0.07
)
$
0.03
  
Weighted average common shares outstanding (in millions)
   
73.2
    
79.8
  
 Basic:
              
Income (loss) per common share
  
$
(0.07
)
$
0.03
  
Weighted average common shares outstanding (in millions)
   
73.2
    
78.2
  
               
Dividends declared per common share
  
$
0.09
  
$
0.08
  


See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.


1

BORDERS GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in millions except per share data)
(UNAUDITED)


 
  
 
  
(Restated)
      
 
 
  
April 23,
2005
  
April 25,
2004
  
January 23,
2005
  
Assets
              
Current assets:
              
Cash and cash equivalents
  
$
94.4
  
$
229.4
  
$
244.8
  
Investments
    
-
    
5.0
    
95.4
  
Merchandise inventories
    
1,335.7
    
1,271.7
    
1,306.9
  
Accounts receivable and other current assets
    
121.1
    
95.6
    
118.3
  
Total current assets
    
1,551.2
    
1,601.7
    
1,765.4
  
Property and equipment, net of accumulated depreciation of
                    
$943.3, $831.7 and $912.2 at April 23, 2005, April 25,
                    
2004 and January 23, 2005, respectively
    
648.4
    
619.1
    
635.6
  
Other assets
   
86.8
    
72.3
    
84.8
  
Deferred income taxes
    
14.6
    
29.0
    
14.4
  
Goodwill
    
130.2
    
102.5
    
128.6
  
Total assets
  
$
2,431.2
  
$
2,424.6
  
$
2,628.8
  
 
                    
 Liabilities, Minority Interest and Stockholders’ Equity
                    
Current liabilities:
                    
Short-term borrowings and current portion of long-term debt
  
$
147.0
  
$
130.1
  
$
141.2
  
Trade accounts payable
    
562.7
    
576.5
    
615.1
  
Accrued payroll and other liabilities
    
261.6
    
249.9
    
306.4
  
Taxes, including income taxes
    
59.2
    
56.8
    
118.3
  
Deferred income taxes
    
15.0