UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the quarterly period ended April 3, 2004 |
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the transition period from to . |
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Commission file number: 0-23633 |
1-800 CONTACTS, INC.
(Exact name of registrant as specified in its charter)
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Delaware |
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87-0571643 |
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(State or other
jurisdiction of |
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(I.R.S. Employer Identification No.) |
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66 E. Wadsworth Park Drive, 3rd
Floor |
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84020 |
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(Address of principal executive offices) |
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(Zip Code) |
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(801) 924-9800 |
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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 such filing requirements for the past 90 days.
ý Yes o No
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange act).
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As of May 5, 2004, the Registrant had 13,285,501 shares of Common Stock, par value $0.01 per share, outstanding.
1-800 CONTACTS, INC.
INDEX
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Condensed
Consolidated Balance Sheets as of January 3, 2004 and |
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Management’s
Discussion and Analysis of Financial Condition |
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PART 1. FINANCIAL INFORMATION
1-800 CONTACTS, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in thousands)
(unaudited)
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January 3, |
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April 3, |
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ASSETS |
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CURRENT ASSETS: |
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Cash |
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$ |
1,075 |
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$ |
957 |
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Accounts receivable |
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944 |
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1,160 |
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Inventories, net |
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24,127 |
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26,574 |
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Prepaid income taxes |
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797 |
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797 |
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Deferred income taxes |
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548 |
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1,023 |
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Other current assets |
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1,752 |
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2,932 |
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Total current assets |
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29,243 |
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33,443 |
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PROPERTY AND EQUIPMENT, net |
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13,183 |
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16,518 |
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DEFERRED INCOME TAX ASSETS |
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710 |
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804 |
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GOODWILL |
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33,853 |
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33,990 |
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DEFINITE-LIVED INTANGIBLE ASSETS, net |
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9,207 |
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17,113 |
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OTHER ASSETS |
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735 |
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672 |
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Total assets |
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$ |
86,931 |
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$ |
102,540 |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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CURRENT LIABILITIES: |
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Current portion of long-term debt |
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3,381 |
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1,122 |
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Current portion of capital lease obligations |
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191 |
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176 |
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Accounts payable |
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8,558 |
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9,668 |
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Accrued liabilities |
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4,847 |
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7,071 |
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Total current liabilities |
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16,977 |
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18,037 |
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LONG-TERM LIABILITIES: |
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Line of credit |
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— |
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15,555 |
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Long-term debt, less current portion |
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14,683 |
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9,114 |
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Capital lease obligations, less current portion |
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64 |
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127 |
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Deferred income tax liabilities |
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— |
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3,324 |
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Total long-term liabilities |
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14,747 |
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28,120 |
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STOCKHOLDERS’ EQUITY: |
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Common stock, 13,113 and 13,285 outstanding, respectively |
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131 |
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133 |
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Additional paid-in capital |
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42,346 |
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45,749 |
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Retained earnings |
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12,834 |
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10,628 |
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Accumulated other comprehensive loss |
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(104 |
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(127 |
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Total stockholders’ equity |
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55,207 |
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56,383 |
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Total liabilities and stockholders’ equity |
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$ |
86,931 |
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$ |
102,540 |
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See accompanying notes to condensed consolidated financial statements.
3
1-800 CONTACTS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
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Quarter Ended |
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March 29, |
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April 3, |
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NET SALES |
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$ |
46,662 |
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$ |
50,849 |
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COST OF GOODS SOLD |
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30,560 |
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31,553 |
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Gross profit |
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16,102 |
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19,296 |
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OPERATING EXPENSES: |
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Advertising |
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3,794 |
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8,815 |
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Legal and professional |
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1,621 |
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1,840 |
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Research and development |
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1,803 |
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892 |
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Purchased in-process research and development |
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— |
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83 |
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Other operating |
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8,649 |
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9,882 |
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Total operating expenses |
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15,867 |
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21,512 |
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INCOME (LOSS) FROM OPERATIONS |
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235 |
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(2,216 |
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OTHER EXPENSE, net |
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(500 |
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(356 |
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LOSS
BEFORE BENEFIT (PROVISION) |
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(265 |
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(2,572 |
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BENEFIT (PROVISION) FOR INCOME TAXES |
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(223 |
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366 |
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NET LOSS |
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$ |
(488 |
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(2,206 |
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PER SHARE INFORMATION: |
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Basic and diluted net loss per common share |
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$ |
(0.04 |
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(0.17 |
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See accompanying notes to condensed consolidated financial statements.
4
1-800 CONTACTS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands)
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Quarter Ended |
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March 29, |
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April 3, |
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CASH FLOWS FROM OPERATING ACTIVITIES: |
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Net loss |
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$ |
(488 |
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(2,206 |
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Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |
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