UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| For the quarterly period ended June 28, 2003 |
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 1-8884
BUSH INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 16-0837346 | |
| (State or other jurisdiction of incorporation of organization) |
(I.R.S. Employer Identification No.) |
One Mason Drive
P.O. Box 460
Jamestown, New York 14702-0460
(Address of principal executive offices)
(Zip Code)
(716) 665-2000
(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 ¨
Number of shares of Common Stock outstanding as of June 28, 2003: 10,428,189 shares of Class A Common Stock and 3,395,365 shares of Class B Common Stock.
BUSH INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
| JUNE 28, 2003 |
DECEMBER 28, 2002 |
|||||||
| (In thousands) | ||||||||
| ASSETS |
||||||||
| Current Assets: |
||||||||
| Cash |
$ | 4,494 | $ | 2,729 | ||||
| Accounts receivable |
10,074 | 16,544 | ||||||
| Inventories |
53,389 | 56,204 | ||||||
| Prepaid expenses and other current assets |
9,901 | 10,668 | ||||||
| Total Current Assets |
77,858 | 86,145 | ||||||
| Property, Plant and Equipment, Net |
190,174 | 196,922 | ||||||
| Other Assets |
28,274 | 27,038 | ||||||
| TOTAL ASSETS |
$ | 296,306 | $ | 310,105 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||
| Current Liabilities: |
||||||||
| Accounts payable |
$ | 22,390 | $ | 26,608 | ||||
| Other accrued liabilities |
20,779 | 24,274 | ||||||
| Current portion of long-term debt |
430 | 462 | ||||||
| Total Current Liabilities |
43,599 | 51,344 | ||||||
| Deferred Income Taxes |
8,376 | 14,923 | ||||||
| Other Long-term Liabilities |
8,180 | 7,530 | ||||||
| Long-term Debt |
114,453 | 100,223 | ||||||
| Total Liabilities |
174,608 | 174,020 | ||||||
| Stockholders’ Equity: |
||||||||
| Common Stock: |
||||||||
| Class A, $.10 par, 20,000,000 shares authorized, 10,837,983 shares issued |
1,084 | 1,084 | ||||||
| Class B, $.10 par, 6,000,000 shares authorized, 3,395,365 shares issued |
340 | 340 | ||||||
| Paid-in capital |
23,633 | 23,633 | ||||||
| Retained earnings |
105,905 | 118,940 | ||||||
| Accumulated other comprehensive (loss) income |
(174 | ) | 1,245 | |||||
| 130,788 | 145,242 | |||||||
| Less treasury stock, 409,794 and 393,578 Class A shares |
(5,903 | ) | (5,838 | ) | ||||
| Less notes receivable related to common stock |
(3,187 | ) | (3,319 | ) | ||||
| Total Stockholders’ Equity |
121,698 | 136,085 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
$ | 296,306 | $ | 310,105 | ||||
See notes to condensed consolidated financial statements.
2
BUSH INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| THIRTEEN WEEKS ENDED | ||||||
| JUNE 28, 2003 |
JUNE 29, 2002 | |||||
| (In thousands, except shares and per share data) | ||||||
| Net Sales |
$ | 70,831 | $ | 78,929 | ||
| Costs and Expenses: |
||||||
| Cost of sales |
51,976 | 56,449 | ||||
| Selling, general and administrative |
16,089 | 19,688 | ||||
| Interest expense |
1,886 | 1,861 | ||||
| Restructuring (See Note 7) |
725 | 0 | ||||
| 70,676 | 77,998 | |||||
| Earnings Before Income Taxes |
155 | 931 | ||||
| Income Taxes |
54 | 390 | ||||
| Net Earnings |
$ | 101 | $ | 541 | ||
| Earnings per Share |
||||||
| Basic |
$ | 0.01 | $ | 0.04 | ||
| Diluted |
$ | 0.01 | $ | 0.04 | ||
| Weighted Average Shares Outstanding |
||||||
| Basic |
13,826,923 | 13,821,388 | ||||
| Diluted |
13,826,936 | 14,120,256 | ||||
See notes to condensed consolidated financial statements.
3
BUSH INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| TWENTY-SIX WEEKS ENDED |
||||||||
| JUNE 28, 2003 |
JUNE 29, 2002 |
|||||||
| (In thousands, except shares and per share data) |
||||||||
| Net Sales |
$ | 145,693 | $ | 167,261 | ||||
| Costs and Expenses: |
||||||||
| Cost of sales |
117,268 | 120,124 | ||||||
| Selling, general and administrative |
35,516 | 40,782 | ||||||
| Interest |
3,649 | 3,586 | ||||||
| Restructuring (See Note 7) |
8,678 | 0 | ||||||
| 165,111 | 164,492 | |||||||
| (Loss) Earnings Before Income Taxes and Cumulative Effect of Accounting Change |
(19,418 | ) | 2,769 | |||||
| Income Tax (Benefit) Expense |
(6,383 | ) | 1,135 | |||||
| (Loss) Earnings Before Cumulative Effect of Accounting Change |
(13,035 | ) | 1,634 | |||||
| Cumulative Effect of Accounting Change |
0 | (2,398 | ) | |||||
| Net Loss |
$ | (13,035 | ) | $ | (764 | ) | ||
| Basic (Loss) Earnings per Share: |
||||||||
| Before cumulative effect of accounting change |
$ | (0.94 | ) | $ | 0.12 | |||
| Cumulative effect of accounting change |
0.00 | (0.17 | ) | |||||
| Net loss |
$ | (0.94 | ) | $ | (0.05 | ) | ||
| Diluted (Loss) Earnings per Share: |
||||||||
| Before cumulative effect of accounting change |
$ | (0.94 | ) | $ | 0.12 | |||
| Cumulative effect of accounting change |
0.00 | (0.17 | ) | |||||
| Net loss |
$ | (0.94 | ) | $ | (0.05 | ) | ||
| Weighted Average Shares Outstanding: |
||||||||
| Basic |
13,828,377 | 13,799,416 | ||||||
| Diluted |
13,828,377 | 14,100,538 | ||||||
See notes to condensed consolidated financial statements.
4
BUSH INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| TWENTY-SIX WEEKS ENDED |
||||||||
| JUNE 28, 2003 |
JUNE 29, 2002 |
|||||||
| (In thousands) | ||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||
| Net loss |
$ | (13,035 | ) | $ | (764 | ) | ||
| Adjustment to reconcile net loss to net cash (used for) provided by operating activities: |
||||||||
| Depreciation and amortization |
9,599 | 9,944 | ||||||
| Cumulative effect of accounting change |
0 | 2,398 | ||||||
| Impairment of idle assets |
3,896 | 0 | ||||||
| Deferred income taxes |
(6,456 | ) | 721 | |||||
| Change in assets and liabilities affecting cash flows: |
||||||||
| Accounts receivable |
6,786 | 1,991 | ||||||
| Inventories |
4,109 | (2,723 | ) | |||||
| Prepaid expenses and other current assets |
1,102 | 2,977 | ||||||
| Accounts payable |
(5,182 | ) | 5,440 | |||||
| Income taxes |
0 | 529 | ||||||
| Other accrued liabilities |
(4,827 | ) | (5,010 | ) | ||||
| Net cash (used for) provided by operating activities |
(4,008 | ) | 15,503 | |||||
| CASH FLOWS FROM INVESTING ACTIVITIES: |
||||||||
| Capital expenditures |
(1,314 | ) | (3,112 | ) | ||||
| Increase in other assets |
(1,421 | ) | (871 | ) | ||||
| Net cash used for investing activities |
(2,735 | ) | (3,983 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: |
||||||||
| Repayment of long-term debt |
(229 | ) | (10,272 | ) | ||||
| Proceeds from long-term debt |
8,386 | 0 | ||||||
| Purchase of Class A Stock for treasury |
(54 | ) | 0 | |||||
| Exercise of stock options by employees |
0 | 621 | ||||||
| Dividends paid |
0 | (1,381 | ) | |||||
| Payments received for notes receivable |
121 | 4 | ||||||
| Net cash provided by (used for) financing activities |
8,224 | (11,028 | ) | |||||
| EFFECT OF EXCHANGE RATE CHANGES ON CASH |
284 | 34 | ||||||
| NET INCREASE IN CASH |
1,765 | 526 | ||||||
| CASH AT BEGINNING OF PERIOD |
2,729 | 1,589 | ||||||
| CASH AT END OF PERIOD |
$ | 4,494 | $ | 2,115 | ||||
See notes to condensed consolidated financial statements.
5
BUSH INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Twenty-six weeks ended June 28, 2003
(Unaudited)
| 1. | The accounting policies used in preparing these statements are the same as those used in preparing the Company’s consolidated financial statements for the fiscal year ended December 28, 2002. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s annual report to stockholders for the fiscal year ended December 28, 2002. |
The foregoing financial information reflects all adjustments which are, in the opinion of management, of a normal and recurring nature and necessary for a fair presentation. The interim results are not necessarily indicative of the results which may be expected for a full year.
| 2. | The following tables set forth total comprehensive income (loss) for the 13 week and 26 week periods indicated below. |
| THIRTEEN WEEKS ENDED |
||||||||
| JUNE 28, 2003 |
JUNE 29, 2002 |
|||||||
| (In thousands) | ||||||||
| Net earnings |
$ | 101 | $ | 541 | ||||
| Accumulated other comprehensive loss |
(491 | ) | (64 | ) | ||||