UNITED STEELWORKERS OF AMERICA LOCAL 2243 OF COPPERWELD STEEL
COMPANY RATIFIES LABOR AGREEMENT
WARREN, Ohio,--Aug. 17, 1995--
Copperweld Steel Company announced today that United Steelworkers of America, Local
2243, soundly ratified a basic labor agreement to become effective upon
the Company's emergence from bankruptcy and the finalization of the
acquisition of the Company's assets by Hamlin Holdings Inc. The
actual vote count was 464 for and 259 against ratifying the
"The provisions of this labor agreement were negotiated by the
parties to meet the needs of our production and maintenance
employees, as well as to better position our company to remain an
efficient, quality-oriented steel bar producer," said Donald J.
Caiazza, Copperweld Steel's President and Chief Executive Officer.
"This is a major step towards our successful reorganization and the
closing of the Hamlin deal which will ultimately benefit our
employees, our customers, and our entire community."
Copperweld Steel Company is a Warren, Ohio based producer of
steel bar products with 1,250 employees, approximately 1,000 of
which are represented by United Steelworkers of America, Local 2243.
The Company has been operating under Chapter 11 since November 1993.
The ratification of this U.S.W.A. labor agreement was one of a few
final milestones necessary to complete the Hamlin transaction, which
is now expected to be accomplished by mid-October 1995.
/CONTACT: William J. Pounds, Vice President, Human Resources, of
Copperweld Steel Company, 216-841-6512/
Grand Union announces first quarter results
WAYNE, N.J.--August 18, 1995--The Grand Union
Company, a regional retail food company, announced that sales for
the 16 weeks ended July 22, 1995, totaled $720.5 million, compared
with sales of $747.7 million for the 16 weeks ended July 23, 1994.
Operating Cash Flow (EBITDA) was $44.3 million, or 6.1% of
sales, for the 16 weeks ended July 22, 1995, compared to EBITDA of
$60.1 million, or 8.0% of sales, for the 16 weeks ended July 23,
Grand Union filed a voluntary petition for protection under
Chapter 11 of the U.S. Bankruptcy Code on January 25, 1995. The
company's Plan of Reorganization was confirmed by the Court on May
31, 1995, and the Company emerged from bankruptcy on June 15, 1995.
For financial reporting purposes, the results of the company's
operations for the 11 weeks prior to June 15, 1995 are separated
from the results of operations for the five weeks subsequent to June
15, 1995 because of a change in the reporting basis of the company
as discussed below. The financial information included herein
combines the results of operations for the entire quarter. However,
as a result of the bankruptcy, the results of operations for the 16
weeks ended July 22, 1995 are not directly comparable to the results
of operations of the 16 weeks ended July 23, 1994.
The sales decline for the 16 weeks ended July 22, 1995, compared
with the prior year, principally resulted from the sale or closure
of 24 stores last year which were not replaced, partially offset by
sales of incremental new stores and a 0.1% same store sales
The 0.1% same store sales increase was favorably influenced by
(a) the timing of the pre-Easter holiday shopping period which was
included in the 16 weeks ended July 22, 1995, but not in the
comparable quarter last year, (b) the closure or sale of under-
performing stores as mentioned above and (c) the full implementation
on May 1, 1995 of a marketing program in the company's Northern
Region, begun on a limited basis last year, which includes both
lower everyday prices and stronger sales promotion programs.
EBITDA (defined as earnings before LIFO provision, depreciation
and amortization, amortization of excess reorganization value,
reorganization items, interest expense, income taxes and
extraordinary item) for the 16 weeks ended July 22, 1995 was
affected by several factors related to the bankruptcy proceedings
including (a) the effect of the company's inability to be fully
invested in forward buy inventory throughout most of last year's
fourth quarter which negatively impacted gross profit in the first
quarter, (b) lower vendor promotional allowances in the early part
of the quarter and (c) increased store labor and fringe costs
resulting from store closures. Additional factors affecting EBITDA
were reducing margins and increased advertising costs associated
with the previously mentioned Northern Region marketing program and
gains on store sales of $3.6 million compared to gains of $1.8
million last year.
The company reported net income of $815.9 million for the 16
weeks ended July 22, 1995, which included an extraordinary gain on
debt discharge of $854.8 million, amortization of excess
reorganization value of $10.1 million and reorganization expenses of
Joseph J. McCaig, president and chief executive officer, said,
"The first quarter still reflects some effects of operating in
bankruptcy and should not be viewed as representative of results for
the full fiscal year." McCaig went on to say, "Late in the first
quarter, we began the conversion of the distribution of product in
the Northern Region from our Waterford, N.Y. Distribution Center to
C&S Wholesale Grocers Inc. of Brattleboro, Vt. The conversion has
progressed very smoothly and is now virtually completed. We expect
that the savings from this change will begin to offset the cost of
our Northern Region marketing program in the second quarter.
Additionally, during the second quarter, the Company will implement
`special voluntary resignation incentive' programs in both of its
operating regions. The programs are designed to induce higher wage
scale employees to accept a bonus package to voluntarily terminate
their employment. We expect that this program will moderate store
labor costs over the remainder of the year."
Roger E. Stangeland, chairman of the company's new board of
directors, noted that the company had substantially deleveraged its
capital structure in the reorganization and expressed confidence in
the steps being taken by management to increase profitability.
Stangeland said that the measures being adopted by the company
should enhance its competitive position and long term profitability.
McCaig said the company currently has under construction
replacement stores in Valatie, N.Y., and Morrisville, Vt., an
incremental new store in Tannersville, N.Y., and store enlargements
in Darien, Conn., and West Islip and Lake Placid, N.Y. The company
expects capital spending this year to be approximately $50 million,
including capitalized leases other than real estate leases.
As of June 15, 1995, the company adopted "fresh-start"
accounting in accordance with American Institute of Certified Public
Accountants Statement of Position 90-7, "Financial Reporting by
Entities in Reorganization under the Bankruptcy Code." Adoption of
fresh-start accounting resulted in an adjustment of the basis of
assets, liabilities and equity to their respective fair values.
Grand Union currently operates 231 retail food stores in six
Northeastern states. Its common stock is traded under the GUCO
symbol on the NASDAQ National Market. -0-
THE GRAND UNION COMPANY
CONSOLIDATED STATEMENT OF OPERATIONS
(in thousands of dollars)
16 Weeks 16 Weeks
July 22, July 23,
Sales $ 720,545 $ 747,692
Gross profit (a) 217,321 231,116
Operating and administrative
expense (a) (173,036) (170,969)
Earnings before LIFO provision,
depreciation and amortization,
amortization of excess
reorganization items, interest
expense, income taxes and
extraordinary gain on debt
discharge (EBITDA) 44,285 60,147
LIFO provision (400) (300)
Depreciation and amortization (24,170) (25,262)
Amortization of excess
reorganization value (10,110) --
Reorganization items (18,627) --
Earnings (loss) before interest
expense, income taxes and
extraordinary gain on debt discharge (9,022) 34,585
Interest expense (29,337) (59,567)
Loss before income taxes and
extraordinary gain on debt discharge (38,359) (24,982)
Income tax provision (500) --
Loss before extraordinary gain on
debt discharge (38,859) (24,982)
Extraordinary gain on debt discharge 854,785 --
Net income (loss) 815,926 (24,982)
Accrued preferred stock dividends -- (5,293)
Net income (loss) applicable to
common stock $815,926 $(30,275)
(a) Gross profit and operating and administrative expense reflect
certain reclassifications made for the 16 weeks ended July 23, 1994
to conform to current year presentation.
CONTACT: The Grand Union Company
Donald C. Vaillancourt, 201/890-6100
AUTOZONE TO ASSUME NATIONWISE LEASES
MEMPHIS, Tenn.,--Aug. 18, 1995--J.R. Hyde III, chairman
and chief executive officer of AutoZone Inc. (NYSE: AZO), announced
today that the company will assume the leases of 44 locations and
purchase one location belonging to Nationwise
Automotive Inc., a Columbus, Ohio-based auto parts chain. AutoZone will also
purchase certain inventories and fixtures. Nationwise today filed for
reorganization under Chapter 11 of the Bankruptcy Code - the
transaction between the two companies is subject to bankruptcy court
approval. Once approval has been granted, the 45 locations in
Indiana, Kentucky, Ohio, Tennessee and West Virginia will be
converted to AutoZone stores.
/CONTACT: (Financial) Sheila Stuewe, 901-325-4458, or (Media) Laura
Nevins, 901-325-6647, both of AutoZone/
MORTGAGE AND REALTY TRUST ANNOUNCES AGREEMENT IN PRINCIPLE ON
ELKINS PARK, Pa.,--Aug. 18, 1995--
Mortgage and Realty Trust (NYSE: MRT) announced today that it had closed its
consent solicitation for its prepackaged plan of reorganization and had
commenced a case under chapter 11 of the bankruptcy code to
implement the prepackaged plan of reorganization. The company had
overwhelming support in the consent solicitation in favor of the
prepackaged plan of reorganization.
MRT is a self-administered real estate investment trust with a
portfolio of over 72 commercial, industrial and other real estate
assets. MRT has offices in Elkins Park, Pennsylvania, and Burbank,
/CONTACT: Daniel F. Hennessey, Treasurer of Mortgage and Realty
Nationwise Automotive Inc. makes announcement
COLUMBUS, Ohio--Aug. 18, 1995--
Nationwise Automotive Inc. announced today that it has concurrently (1) signed
an agreement to sell a significant number of its stores to AutoZone
Inc., (2) filed for reorganization under Chapter 11 of the
Bankruptcy Code, as contemplated by the AutoZone agreement, and (3)
arranged additional, ``debtor-in-possession'' financing through its
senior secured lender, Foothill Capital Corp.
The sale to AutoZone involves the transfer of store sites,
fixtures and inventory. Bankruptcy court approval is required
before the transaction can be finalized.
``We are pleased our efforts produced the deal with AutoZone,
and hopeful a reorganization and/or sale of our other assets can be
achieved through Chapter 11,'' the board of directors of Nationwise
stated. ``This course of action is the best alternative available
to maximize results for our creditors, customers, employees and
Nationwise will now immediately pursue both approval of the
AutoZone transaction through a bankruptcy-court-approved process,
and reorganization and/or sale of its other assets. Nationwise's
financial advisor, Gordian Group, L.P., will continue the process to
obtain new investment in, or sale of, the company, as well as to
evaluate reorganization alternatives.
CONTACT: Gordian Group, L.P.
Peter S. Kaufman or
Barbara S. Scholl, 614/239-5116 or