UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
Movie Gallery, Inc.
(Exact name of registrant as specified in its charter)
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Delaware |
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63-1120122 |
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(State or other
jurisdiction of |
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(I.R.S. Employer |
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900 West Main Street, Dothan, Alabama |
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36301 |
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(Address of principal executive offices) |
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(Zip Code) |
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(334) 677-2108 |
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(Registrant’s telephone number, including area code) |
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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 filing requirements for the past 90 days. YES ý NO o
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).
YES ý NO o
The number of shares outstanding of the registrant’s common stock as of November 12, 2003 was 32,663,705.
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Part I. |
Financial Information |
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Item 1. |
Consolidated Financial Statements (Unaudited) |
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Consolidated Balance Sheets – January 5, 2003 and October 5, 2003 |
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Consolidated Statements of Cash Flows – Thirty-nine weeks ended October 6, 2002 and October 5, 2003 |
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Notes to Consolidated Financial Statements – October 5, 2003 |
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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Movie Gallery, Inc.
(in thousands)
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January 5, |
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October 5, |
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(Unaudited) |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
39,526 |
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$ |
19,411 |
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Merchandise inventory |
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18,646 |
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17,620 |
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Prepaid expenses |
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1,533 |
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2,107 |
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Store supplies and other |
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7,585 |
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8,978 |
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Total current assets |
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67,290 |
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48,116 |
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Rental inventory, net |
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82,880 |
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95,453 |
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Property, furnishings and equipment, net |
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86,993 |
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106,835 |
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Goodwill |
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116,119 |
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132,710 |
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Other intangibles, net |
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6,677 |
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8,419 |
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Deposits and other assets |
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3,615 |
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6,983 |
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Total assets |
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$ |
363,574 |
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$ |
398,516 |
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Liabilities and stockholders’ equity |
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Current liabilities: |
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Accounts payable |
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$ |
66,996 |
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$ |
49,272 |
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Accrued liabilities |
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23,524 |
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25,004 |
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Deferred revenue |
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9,636 |
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7,028 |
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Deferred income taxes |
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742 |
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844 |
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Total current liabilities |
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100,898 |
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82,148 |
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Other accrued liabilities |
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249 |
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190 |
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Deferred income taxes |
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3,376 |
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15,217 |
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Stockholders’ equity: |
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Preferred stock, $.10 par value; 2,000,000 shares authorized, no shares issued or outstanding |
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— |
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— |
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Common stock, $.001 par value; 65,000,000 shares authorized, 32,061,871 and 32,647,426 shares issued and outstanding, respectively |
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32 |
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33 |
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Additional paid-in capital |
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216,631 |
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223,533 |
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Retained earnings |
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42,647 |
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74,623 |
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Accumulated other comprehensive income (loss) |
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(259 |
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2,772 |
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Total stockholders’ equity |
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259,051 |
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300,961 |
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Total liabilities and stockholders’ equity |
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$ |
363,574 |
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$ |
398,516 |
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See accompanying notes.
1
Movie Gallery, Inc.
Consolidated Statements of Income
(Unaudited)
(in thousands, except per share data)
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Thirteen Weeks Ended |
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Thirty-Nine Weeks Ended |
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October 6, |
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October 5, |
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October 6, |
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October 5, |
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Revenues: |
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Rentals |
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$ |
122,246 |
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$ |
154,565 |
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$ |
354,298 |
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$ |
456,322 |
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Product sales |
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8,189 |
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12,674 |
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21,845 |
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40,564 |
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Total revenues |
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130,435 |
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167,239 |
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376,143 |
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496,886 |
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Cost of sales: |
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Cost of rental revenues |
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34,551 |
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44,559 |
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99,285 |
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134,966 |
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Cost of product sales |
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5,481 |
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10,005 |
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15,403 |
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32,447 |
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Gross margin |
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90,403 |
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112,675 |
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261,455 |
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329,473 |
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Operating costs and expenses: |
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Store operating expenses |
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65,062 |
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84,902 |
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185,737 |
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238,801 |
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General and administrative |
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9,339 |
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11,956 |
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31,476 |
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34,461 |
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Amortization of intangibles |
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416 |
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493 |
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1,113 |
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1,389 |
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Stock option compensation |
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(151 |
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128 |
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795 |
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1,626 |
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