CANTON, Mass. -- March 15, 1996 -- href="chap11.hills.html">Hills Stores
Company (NYSE:HDS) today released its fiscal 1995 fourth
quarter and
year end results.
Fiscal 1995 was a 53 week fiscal year for Hills with the fourth
quarter containing 14 weeks versus 13 weeks the prior fiscal year.
Total sales for the 14 week quarter ended Feb. 3, 1996 increased
3.9% over the previous year to $699.8 million and, excluding the
14th week, comparable sales decreased 4.7% to $625.8 million. Gross
profit decreased slightly to $188.9 million from $189.4 million and
declined as a percentage of sales from 28.1% to 27.0%. Selling and
administrative expenses increased by $0.9 million to $114.9 million
from $114.0 million in the fourth quarter of fiscal 1994 but
declined as a percentage of sales to 16.4% from 16.9%.
The Company recorded an adjustment of $9.4 million in the fourth
quarter of 1995 increasing the estimated cost associated with the
July change in control. These costs relate primarily to various
disbursements made to prior executives in July and the Company's
position relative to the recovery of those amounts. The Company
believes that a portion of these disbursements may be recoverable
and is pursuing its remedies. The increase in interest expense for
the quarter reflects additional borrowings associated with the
Company's repurchase of shares in the first fiscal quarter and the
payment of change in control costs. Other income in the prior year
fourth quarter earnings included $9.6 million of income related to a
reversal of liabilities established in "fresh-start" accounting
partially offset by $2.2 million of additional amortization of
deferred financing costs and $2.2 million paid to holders of the
Company's Senior Notes in connection with the Company's self-tender.
For the quarter, the Company generated net earnings of $7.4
million, or $0.66 per share on a fully-diluted basis, versus $33.5
million, or $2.26 per share the prior year. Fourth quarter earnings
before interest, taxes, depreciation and amortization, as defined in
Notes B and G to the 1995 Summary of Operations table that follows
("EBITDA"), were $76.7 million versus $75.6 million last year.
Total sales for the 53 week year ended Feb. 3, 1996 increased
1.5% over the previous year to $1,900.1 million and, excluding the
53rd week, comparable sales decreased 3.9% to $1,777.0 million.
Gross profit decreased to $515.7 million from $531.8 million and
declined as a percentage of sales from 28.4% to 27.1%. Selling and
administrative expenses increased by $9.5 million to $399.9 million
from $390.4 million but remained relatively flat as a percentage of
sales at 21.0% versus 20.9% last year. The prior year selling and
administrative expenses include a $4.5 million pension gain.
Excluding this item, the Company's selling and administrative
expenses increased $5.1 million and declined as a percentage of
sales to 21.0% from 21.1%.
The current year's earnings reflect a charge of $45.5 million in
costs related to the change in control. The increase in interest
expense for the year reflects additional borrowings associated with
the Company's repurchase of $75.0 million of stock in the first
fiscal quarter and the payment of the change in control costs. For
the year, the Company generated a net loss of $16.7 million, or
$1.66 per share versus earnings of $40.4 million, or $2.73 per share
the prior year. For fiscal 1995, EBITDA was $119.3 million versus
$138.1 million last year.
Gregory K. Raven, the President and Chief Executive Officer,
stated "Although we were disappointed with our sales in 1995, it was
a difficult year for many discount retailers, and we believe our
performance, relative to the industry as a whole, was above average.
Significant competitive pricing pressures in hardlines and a mix
shift due to softer sales than normal in the apparel business,
resulted in a decline in gross margin rates for the year. To offset
that decrease, the Company continued to aggressively manage its
expenses and was able to reduce its selling and administrative
expenses (after excluding the one-time pension gain of $4.5 million
in fiscal 1994) as a percentage of sales.
"Hills also actively adjusted its inventory purchases throughout
the year, resulting in inventory levels at year-end of $331.7
million, which was below plan. The inventory actions taken have
resulted in no significant clearance markdown exposure in the
Company's ending inventory. There were no borrowings under the
Company's credit facility at year-end and trade payables were $82.6
million.
"The 1995 results were generated during a year in which Hills
experienced significant non-business related distractions.
Excluding the cost of the change in control, Hills was profitable in
1995. We are entering 1996 with a strong balance sheet and the
financial resources, both internal and external, to drive the
business. We are confident that, with the support of our associates
and our vendors, Hills' strategies will enable the Company to
improve our operating results."
Hills Stores Company is a leading regional discount retailer
operating 164 stores in 12 Mid-Western and Mid-Atlantic states.
REGARDING
1995 Summary of Operations (unaudited)
($ in 000's, except per share amounts)
1995(a) 1994(e) $ Change % Change
Fourth quarter
Sales $699,785 $673,580 $26,205 3.9%
EBITDA 76,687(b) 75,598(g) 1,089 1.4%
Operating earnings 54,242 66,052 (11,810) -17.9%
Net earnings 7,405 33,467 (26,062) -77.9%
Earnings per share $0.66 $2.26 ($1.60) -70.8%
Shares outstanding 11,221 14,837 (3,616) -24.4%
1995(c) 1994(f)
Year
Sales $1,900,104 $1,872,021 $28,083 1.5%
EBITDA 119,344(b) 138,133(g)(18,789) -13.6%
Operating earnings 31,168 105,755 (74,587) -70.5%
Net earnings (loss) (16,666) 40,431 (57,097) -141.2%
Earnings (loss) per share ($1.66) $2.73 ($4.39) -160.8%
Shares outstanding (D) 10,029 14,832 (4,803) -32.4%
(a) Operating earnings, net earnings and earnings per share include
a $9.4 million pre-tax charge for costs, primarily additional taxes,
associated with the July 5, 1995 change of control.
(b) Represents FIFO earnings before interest, taxes, depreciation
and amortization, and change in control costs.
(c) Operating earnings, net loss and loss per share include a $45.5
million pre-tax charge related to severance expenses paid to certain
senior officers and employees of the Company, and legal and other
expenses, associated with the July 5, 1995 change of control.
(d) Fully diluted average shares outstanding for the year ended
February 3, 1996 do not include 1,231,795 shares of preferred stock
as their effect would be anti-dilutive.
(e) Net earnings and earnings per share include $9.6 million of
income related to a reversal of liabilities established in
"fresh-start" accounting, $2.2 million of additional amortization of
deferred financing costs and $2.2 million paid to holders of the
Company's Senior Notes in connection with the Company's self-tender.
(f) In addition to the items noted in (e) above, operating earnings,
net earnings and earnings per share include a gain of $4.5 million
from the elimination of the Company's pension benefit obligation.
(g) Represents FIFO earnings before interest, taxes, depreciation
and amortization; and also excludes a gain of $4.5 million from the
elimination of the Company's pension benefit obligation recorded in
the
first quarter of 1994, $9.6 million of income related to a reversal
of liabilities established in "fresh-start" accounting, $2.2 million
of additional amortization of deferred financing costs and $2.2
million paid to holders of the Company's Senior Notes in connection
with the Company's self-tender.
HILLS STORES COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
Quarter ended Year ended
February 3, January 28, February 3, January 28,
1996 1995 1996 1995
(14 weeks) (13 weeks) (53 weeks) (52 weeks)
(unaudited) (unaudited)
Net sales $699,785 $673,580 $1,900,104 $1,872,021
Cost of sales 510,847 484,194 1,384,421 1,340,221
Gross profit 188,938 189,386 515,683 531,800
Selling and
administrative
expenses 114,860 114,024 399,934 390,397
Depreciation
and amortization 8,494 7,064 31,297 26,662
Amortization of
reorganization
value in excess of
amounts allocable
to identifiable
assets 1,939 2,246 7,755 8,986
Costs related to
change in control 9,403 -- 45,529
--
Operating earnings 54,242 66,052 31,168 105,755
Other income
(expense): Interest expense on
capital leases (3,453) (3,622) (14,066)
(14,707)
Other interest
expense (9,364) (6,457) (35,431)
(24,005)
Other income, net 2,682 7,171 4,850 9,241
(10,135) (2,908) (44,647) (29,471)
Earnings (loss)
before income
taxes 44,107 63,144 (13,479) 76,284
Income tax
provision (36,702) (29,677) (3,187)
(35,853) Net earnings (loss)
applicable to
shareholders $7,405 $33,467 ($16,666) $40,431
Primary earnings
(loss) per common
share $0.66 $2.37 ($1.70) $2.87
Fully- diluted
earnings (loss) per
common share $0.66 $2.26 ($1.66) $2.73
Primary shares
outstanding 11,221 14,111 9,810 14,105
Fully-diluted shares
outstanding 11,221 14,837 10,029 14,832
EBITDA - FIFO
(unaudited) $76,687 $75,598 $119,344 $138,133
CONTACT: Hills Stores Co. Canton,
William K. Friend
617/821-1000, Ext. 1189
or
The Bromley Group Inc., New York
Alan Bromley
212/807-0878
BUFFALO GROVE, Ill., March 15, 1996 - Telular Corporation
(Nasdaq: WRLS) announced today, in response to numerous inquiries by
stockholders, that it is not, at this time, aware of any significant
adverse change in the Company's business or prospects that has not
been previously disclosed. Telular's stock has experienced a
significant decline, with the trading price ranging from $10.25 to
$2.00 since the first of the year. Telular believes that this
decline is attributable, to a considerable extent, to extensive
conversion and sale of shares pursuant to convertible debentures
issued by Telular in a Regulation S offering last December. Of the
$18 million in debentures issued in December, approximately $6
million representing roughly 2,000,000 shares have been converted as
of March 13, 1996.
Current Outlook
Telular also announced that while final results are not
available for the fiscal quarter ended March 31, 1996, the Company
currently expects revenues for the quarter to be in the range of
$4.0 to $6.0 million. This compares to revenues during the
comparable quarter of fiscal 1995 of $8.2 million. With lower
comparable revenues and higher costs, resulting primarily from
restructuring charges, the Company anticipates the loss for the
current quarter to be greater than the loss of seventeen cents per
share reported for the same quarter in fiscal 1995. The Company
expects that its cash reserves, with no short- term borrowings, to
be no less than $17.0 million at March 31, 1996. Earnings are
dependent, in part, on the amount and timing of orders that cannot
be predicted with assurance. Telular will announce final results
for the quarter when they become available.
Columbia Capital Principals Announce Intention to Purchase Shares
The Company also announced that it has been advised by Columbia
Capital Corporation, one of the Company's major stockholders, that
principals of Columbia Capital have begun to purchase stock in the
market in accordance with capital rule 10b-18 under the Securities
Exchange Act of 1934, in the belief that current market prices do
not reflect the real value of the Company. These principals expect
the amount and timing of their purchases to depend, in considerable
part, upon market conditions in effect from time to time.
Recent Announcements
The Company has previously announced a significant restructuring
of its operations and expects to incur $7-9 million in charges,
primarily of non-cash write-offs. The restructuring is in process
and completion is expected by June 30, 1996. Telular announced on
March 8, 1996 a purchase order of $25 million, under an existing
sales agreement with Motorola. During 1996, $19 million of its
PhoneCell SXH fixed wireless terminals are scheduled for deployment
in Hungary, with the balance slated for shipment in early calendar
1997.
Founded in 1986, Telular has developed telecommunications
interface technology that switches a standard phone system, fax,
computer modem or monitored alarm system to available wireless
service for either primary or back-up communications. The line of
fixed wireless products developed and marketed by Telular includes
the PhoneCell(TM) line of products, the modular PhoneCell CPX(TM),
the PCSone(TM) intelligent docking station and the AXCELL cellular
mobile data interface.
CONTACT: Timothy L. Walsh, Vice President and Treasurer, or Steve
McConnell, Vice President, Financial Analysis & Operations
Accounting, of Telular Corporation, 847-465-4500
TCBY reports improved operating results for first quarter
LITTLE ROCK, Ark. -- March 15, 1996 -- TCBY
Enterprises, Inc. (NYSE:TBY) announced its results improved from a
net loss of $4,435,290, or $.17 per share, in the first quarter of
fiscal 1995 to a net loss of $504,677, or $.02 per share, in the
first quarter of fiscal 1996.
First quarter 1995 results include a loss of $.06 per share due
to the adoption of a new accounting standard. The improvement in
results reflects a reduction in selling, general and administrative
costs primarily achieved through the Company's restructuring, the
sale of Company-owned stores, and a focus on geographic regions
where the Company's hardpack products can be delivered and marketed
in a more efficient manner. Sales and franchising revenues for the
first quarter of 1996 were $17,277,653 compared to $27,952,759 in
the first quarter of 1995. The decline in sales and franchising
revenues is primarily attributable to a decrease in sales to the
retail grocery trade as a result of the sale of the Company's
refrigerated yogurt line during the second quarter of fiscal 1995,
and the execution of the Company's decision to franchise or close
the 88 Company-owned stores in operation as of first quarter 1995.
As of February 29, 1996, there were 2,693 "TCBY"(R) locations
worldwide. These locations are comprised of 1,208 traditional
domestic stores, 1,267 non-traditional domestic locations, 192
international locations, and 26 Company-owned stores. The Company
continues to franchise its Company-owned stores as announced in
December 1995 and expects to complete this process in fiscal 1996.
Also in December, 1995, the Company announced the authorization
by its Board of Directors to purchase up to three million shares of
its outstanding common stock and has purchased over 325,000 shares
since that time. Purchases have been made utilizing the Company's
available cash resources.
"We are encouraged by our first quarter results in light of the
harsh winter experienced across the country," said Herren
Hickingbotham, President and Chief Operating Officer. "Many changes
were announced in December, and we are seeing immediate improvements
as a result of the implementation of these plans. We are also
excited about our development opportunities in 1996 through new
international and non-traditional locations, as well as through
continued conversions and expansion of the TCBY Treats program in
our traditional stores."
Subsequent to the close of the first quarter, the Company
announced its international division had finalized a franchise
agreement for Israel. In addition, it was announced that a national
development agreement had been reached with Citgo Petroleum
Corporation to pursue co-branding opportunities in Citgo locations
across the country.
The Board of Directors of the Company declared a $.05 per share
cash dividend payable on April 12, 1996 to stockholders of record as
of March 29, 1996.
TCBY Enterprises, Inc., through subsidiary companies,
manufactures and sells soft serve frozen yogurt, hardpack frozen
yogurt and ice cream, novelty products, and markets foodservice
equipment. The Company is the largest manufacturer-franchisor of
frozen yogurt in the world.
TCBY Enterprises, Inc.
Selected Financial Highlights
(In Thousands, Except Per Share Amounts)
(Unaudited)
Three Months Ended
February 29 February 28
1996 1995
Operating results
Sales & franchising revenues $ 17,278 $ 27,953
Net loss $ (505) $ (4,435)
Net loss per share $ (.02) $ (.17)
Average shares outstanding 25,564 25,596
Dividends paid per share $ .05 $ .05
February 29 November 30
1996 1995
Financial position
Current assets $ 47,697 $ 51,357
Current liabilities $ 13,349 $ 14,668
Property, plant & equipment, net $ 45,023 $ 45,710
Total assets $106,651 $111,625
Long-term debt $ 12,112 $ 12,641
Stockholders' equity $ 79,052 $ 82,179
Consolidated Balance Sheets
(Unaudited)
February 29 November 30
1996 1995
Current assets:
Cash and cash equivalents $ 500,558 $ 5,565,654
Short-term investments 11,275,252 8,824,163
Receivables:
Trade accounts 9,883,909 10,114,935
Notes 2,907,644 2,918,762
Allowance for doubtful accounts
and impaired notes (1,589,587) (1,592,607)
------------- -------------
11,201,966 11,441,090
Refundable income taxes 4,697,990 4,418,936
Deferred income taxes 2,463,089 2,463,089
Inventories 12,444,173 12,920,468
Prepaid expenses and other assets 2,266,520 2,098,366
Assets held for sale 2,847,756 3,625,375
Total current assets 47,697,304 51,357,141
Property, plant, and equipment:
Land 2,866,820 2,866,820
Buildings 23,710,187 23,402,389
Furniture, vehicles, and equipment 47,417,615 47,325,993
Leasehold improvements 3,319,745 3,214,117
Construction in progress 218,892 31,483
Allowance for depreciation and
amortization (32,510,728) (31,130,608)
------------- -------------
45,022,531 45,710,194
Other assets:
Notes receivable, less current portion
(less allowance for doubtful notes
of $9,484,673 in 1996 and $9,585,410
in 1995) 7,001,935 7,035,259
Intangibles (less amortization of
$1,561,773 in 1996 and $1,514,068
in 1995) 3,579,581 3,517,942
Other 3,349,377 4,004,707
------------- -------------
13,930,893 14,557,908
Total assets $106,650,728 $111,625,243
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 3,115,777 $ 2,455,127
Accrued expenses 7,061,569 9,041,380
Current portion of long-term
debt 3,171,448 3,171,448
Total current liabilities 13,348,794 14,667,955
Long-term debt, less current
portion 12,112,330 12,640,904
Deferred income taxes 2,137,617 2,137,617
Commitments and contingencies
Stockholders' Equity:
Preferred stock, par value $.10
per share; authorized 2,000,000
shares - -
Common stock, par value $.10
per share; authorized 50,000,000
shares; issued - 1996 - 27,062,345;
1995 - 27,062,345 2,706,235 2,706,235
Additional paid-in capital 25,547,184 25,547,184
Retained earnings 61,874,839 63,661,235
------------- -------------
90,128,258 91,914,654
Less treasury stock, at cost
(1,705,869 shares in 1996 and
1,387,069 in 1995) (11,076,271) (9,735,887)
Total stockholders' equity 79,051,987 82,178,767
Total liabilities and stockholders'
equity $106,650,728 $111,625,243
Consolidated Statements of Operations (Unaudited)
Three Months Ended
February 29
1996 1995
Sales $ 15,052,899 $ 26,036,075
Cost of sales 9,451,986 15,826,334
Gross profit 5,600,913 10,209,741
Franchising revenues:
Initial franchise and
license fees 532,750 195,900
Royalty income 1,692,004 1,720,784
Total franchising revenues 2,224,754 1,916,684
------------- -------------
7,825,667 12,126,425
Selling, general and
administrative expenses 8,659,113 16,465,479
Loan impairment charge - 2,466,922
------------- -------------
8,659,113 18,932,401
(Loss) income from operations (833,446) (6,805,976)
Other income (expense):
Interest expense (262,754) (298,451)
Interest income 275,778 274,440
Other income (expense) 43,996 25,444
------------- -------------
57,020 1,433
(Loss) income before income taxes (776,426) (6,804,543)
Income tax expense (benefit) (271,749) (2,369,253)
Net (loss) income $ (504,677) $ (4,435,290)
Net (loss) income per share $ (0.02) $ (0.17)
Average shares outstanding 25,563,836 25,595,638
Cash dividends paid per share $ 0.05 $ 0.05
CONTACT: TCBY Enterprises, Inc., Little Rock
Stacy Duckett, 501/688-8229
LOS ANGELES, March 15, 1996 - Kerr Group, Inc. (NYSE:
KGM), announced today the sale of certain assets of the Consumer
Products Business, a reduction of debt and extension of waivers by
lenders, a restructuring program, a new Chief Executive Officer, and
1995 financial results.
SALE OF ASSETS
Roger W. Norian, Chairman, President and Chief Executive
Officer, said that the Company had sold certain assets of the
Consumer Products Business to Alltrista Corporation for a purchase
price of $14.5 million. He said that the Company also expects to
receive approximately $16.5 million, primarily during the remainder
of 1996, from the Company's sale to its customers of the inventory
and from the collection of the accounts receivable of the Consumer
Products Business. These proceeds will be utilized for working
capital, to reduce debt, including $3.5 million of debt secured by
liens on certain fixed assets of the Company, and to fund costs of
the restructuring program.
DEBT REDUCTION
Mr. Norian said that the debt holders had agreed to extend,
until May 15, 1996, waivers with respect to defaults under certain
financial covenants in loan agreements with the Company and to
extend the maturity of a $6.0 million note due April 15, 1996, until
May 15, 1996. He also stated that discussions with the Company's
lenders were continuing regarding further amendments of terms,
including the further extension of the maturity of the $6.0 million
note, and additional reduction of indebtedness. He said that the
indebtedness of the Company is unsecured.
RESTRUCTURING PROGRAM
Mr. Norian said that he had recommended to the Board of
Directors a restructuring of the Company which would include moving
the corporate headquarters from Los Angeles, California to
Lancaster, Pennsylvania, where the Plastic Products Business is
headquartered, and the consolidation of certain manufacturing
facilities. He said this restructuring would result in annualized
cost savings of approximately $6.5 million. These savings will be
substantially realized in 1997.
Mr. Norian said that he had told the Board of Directors that,
after more than 20 years with the Company in its Los Angeles office,
first as Chief Financial Officer and then as Chief Executive
Officer, he had decided not to move to Lancaster. He said that he
had recommended that D. Gordon Strickland, Senior Vice President,
Chief Financial Officer and General Manager of the Consumer Products
Business, be elected as President, Chief Executive Officer, and a
Director of the Company. Mr. Norian said that the Board had
approved the restructuring program, accepted his decision not to
move to Lancaster, and approved his recommendation with respect to
Mr. Strickland. Mr. Norian said that effective today, he had been
succeeded by Mr. Strickland. Mr. Norian said that he would continue
as a Director but had resigned as Chairman.
In connection with the sale of Consumer Products Business assets
and the restructuring program, the Company will report in the first
quarter of 1996 a one time pretax charge of approximately $4.8
million, which is comprised of a $2.9 million gain on the sale of
the Consumer Products assets and a restructuring charge of $7.7
million. In addition to this charge, the Company will incur
additional non-recurring pretax charges of $2.4 million during 1996
and early 1997 for restructuring related costs that accounting rules
do not permit to be accrued at the time of announcement of a
restructuring.
1995 FINANCIAL RESULTS
Kerr reported a loss applicable to common stockholders of
$6,136,000 or $1.60 per common share for the year ended December 31,
1995, compared to earnings applicable to common stockholders for the
year ended December 31, 1994 of $2,575,000 or 70 cents per common
share. The loss in 1995 includes an unusual loss of $602,000 after
tax, or $0.16 cents per common share, related to the write-down in
the book value of land formerly used by the Company as a glass
container manufacturing plant.
The decline in earnings in 1995, as compared to 1994, was due
primarily to lower earnings in both the Plastic Products and
Consumer Products Businesses, and higher interest expense. Earnings
of the Plastic Products Business decreased in 1995 compared to 1994,
primarily due to cost-price pressures, including substantially
higher resin costs and competitive pricing.
The current price the Company is paying for resin has declined
significantly since July 1995.
Earnings of the Consumer Products Business decreased in 1995
compared to 1994, primarily due to the sale of higher cost inventory
produced during 1994, higher customer rebates, and lower sales
volume due to adverse weather conditions.
Net sales amounted to $138,995,000 in 1995 compared to
$139,156,000 in 1994.
Net sales of the Plastic Products Business increased to
$109,187,000 in 1995 compared to $106,792,000 in 1994. Segment
operating earnings of the Plastic Products Business decreased to
$4,842,000 in 1995, compared to $12,055,000 in 1994.
Net sales of the Consumer Products Business decreased to
$29,808,000 in 1995 from $32,364,000 in 1994. Segment operating
earnings of the Consumer Products Business decreased to a loss of
$1,590,000 in 1995, compared to earnings of $3,213,000 in 1994.
For the three months ended December 31, 1995, the Company had a
loss applicable to common stockholders of $3,744,000 or 95 cents per
common share, compared to earnings applicable to common stockholders
of $24,000 or 1 cent per common share in the three months ended
December 31, 1994. The decline in earnings in 1995 was primarily due
to lower earnings in both the Plastic Products and Consumer Products
Businesses. Earnings of the Plastic Products Business declined
primarily due to cost-price pressures and lower production volume.
Earnings of the Consumer Products Business decreased primarily due
to the sale of higher cost inventory produced in 1994, higher
customer rebates, and lower sales volume. The loss in the fourth
quarter of 1995 includes an unusual loss of $602,000 or $0.15 cents
per common share related to the write-down in the book value of
land.
Net sales were $27,692,000 in the fourth quarter of 1995 as
compared to $28,148,000 in the same period in 1994.
Kerr is a major producer of plastic packaging products.
KERR GROUP, INC.
Consolidated Statements of Earnings (Loss) for the
Three Months and Twelve Months Ended December 31, 1995 and 1994
(In Thousands)
Three Months Ended Twelve Months Ended
December 31, December 31,
1995 1994 1995 1994
(Unaudited) (Audited)
Net sales $27,692 $28,148 $138,995 $139,156
Cost of sales 24,101 19,607 108,964 96,356
Gross profit 3,591 8,541 30,031 42,800
Selling, warehouse,
general and
administrative expense 6,931 7,098 32,037 32,435
Loss on revaluation
of land (1) 1,000 0 1,000 0
Interest expense 1,587 1,258 6,047 4,985
Interest and other income (90) (72) (228) (369)
Earnings (loss)
before income taxes (5,837) 257 (8,825) 5,749
Provision (benefit)
for income taxes (2,301) 25 (3,518) 2,345
Net earnings (loss) $(3,536) $232 $(5,307) $3,404
Preferred stock dividends 208 208 829 829
Net earnings (loss)
applicable to
common stockholders $(3,744) $24 $(6,136) $2,575
Net earnings (loss)
per common share,
primary and
fully diluted:(2) $(0.95) $0.01 $(1.60) $0.70
(2) Weighted average number of common shares outstanding for
the three months and twelve months ended December 31, 1995 were
3,933,000 and 3,842,000, respectively, and for the three months and
twelve months ended December 31, 1994 were 3,677,000 and 3,674,000,
respectively. Fully diluted net earnings per common share reflect
when dilutive, a) the incremental common shares issuable upon the
assumed exercise of outstanding stock options, and b) the assumed
conversion of the Preferred Stock and the elimination of the related
Preferred Stock dividends. Antidilution occurred in the three
months and twelve months ended December 31, 1995 and 1994.
CONTACT: D. Gordon Strickland, President and Chief Executive
Officer of Kerr Group, 310-284-2585
PURCHASE, N.Y. March 15, 1996 - href="chap11.spectrum.html">Spectrum Information
Technologies, Inc. (Nasdaq-NNM: SPCL) today announced that the
Honorable Conrad B. Duberstein of the U.S. Bankruptcy Court of the
Eastern District of New York has authorized the Company to go
forward with its plan to seek creditor and shareholder approval of
its proposed plan of reorganization.
In a hearing yesterday, the court ruled that the Amended
Disclosure Statement describing the Amended Proposed Plan of
Reorganization filed by Spectrum for itself and its Spectrum
Cellular subsidiary was adequate for distribution. Accordingly,
Spectrum will mail the proposed plan, together with a disclosure
statement, to all of the company's creditors and shareholders on or
before March 22, 1996. The court has set a deadline of April 22,
1996 to receive any objections to the proposed plan. A hearing to
confirm the proposed plan has been scheduled for 9:30 a.m. on May 3,
1996.
Spectrum filed a voluntary Chapter 11 petition in the Bankruptcy
Court in January 1995 and has since been reorganizing its business.
The proposed plan of reorganization and disclosure statement
describe Spectrum's proposed business plan and recapitalization
immediately following confirmation of the plan. The disclosure
statement discusses Spectrum's strategy to shift its focus from a
licensing and royalty business to a mobile communications software
business.
Consistent with the agreement in principle on a framework to
settle the class action securities litigation that has been pending
against the Company since 1993, the proposed plan of reorganization,
if approved, would result in substantial dilution to holders of
Spectrum common stock. The proposed plan does not include outside
investment, which would have further diluted the current
shareholders' interests.
CONTACT: Media - Michael Freitag of Kekst and Company,
212-593-2655; or Investors - Spectrum Information Technologies,
Inc., Investor Relations, 914-251-1800, Ext. 182
BOSTON, MA -- March 15, 1996 -- BOSTON RESTAURANT
ASSOCIATES, INC. (NASDAQ: BRAI, BRAIW) (BSE: BNR, BNRW) today
announced the Company's third quarter results.
In the third quarter, BOSTON RESTAURANT ASSOCIATES, INC.
reported a $1,401,738 loss of which $821,598 is associated with the
closure of its Framingham location. This loss represents
depreciation, amortization and goodwill attributable to Capucino's
Framingham. In addition, overhead reflects legal fees associated
with various real estate transactions, including the closure of
restaurants in Cambridge, Brookline, and Wellesley locations. The
write down was the result of restructuring BOSTON RESTAURANT
ASSOCIATES, INC. which will concentrate on building Pizzeria
Regina's and refining the Polcari's North End concept.
George R. Chapdelaine, Chief Executive Officer of BOSTON
RESTAURANT ASSOCIATES, INC., said, "We have spent fiscal year 1996
restructuring BOSTON RESTAURANT ASSOCIATES, INC. for the future. In
an effort to maximize our resources and management we have
positioned BOSTON RESTAURANT ASSOCIATES, INC. to fuel growth through
the Pizzeria Regina concept. In February, we opened a Pizzeria
Regina in Brookline featuring brick oven pizza and a large selection
of microbrews. Sales to date have exceeded our forecast. In
addition, Polcari's North End Restaurant has seen positive results
from refinement in the concept and the additions of JP's Jukebox
Lounge. I believe with the completion of restructuring in 1996, we
can look forward to a strong future."
BOSTON RESTAURANT ASSOCIATES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Thirteen Weeks Ended Thirty-Nine Weeks Ended
January 28 January 29 January 28 January 29
1996 1995 1996 1995
Sales $2,325,664 $2,970,371 $8,407,824 $9,928,315
Cost Of Food
And Beverage $557,635 $741,567 $2,019,968 $2,474,645
Payroll $856,854 $1,075,063 $2,919,929 $3,489,464
Other Operating
Expenses $958,601 $1,075,549 $2,932,171 $3,165,773
General and
Administrative $531,349 $405,851 $1,371,415 $1,255,048
Loss From Store
Closure $821,598 $0 $821,598 $0
---------- ---------- ---------- -----------
Loss From
Operations ($1,400,373) ($327,659) ($1,657,257) ($456,615)
Other(income) ($3,355 $0 ($53,698) $0
Interest(income) ($2,144) ($37,864) ($5,305) ($50,275)
Interest Expense $6,864 $8,278 $17,098 $212,501
---------- ---------- ----------- ----------
Net Loss ($1,401,738) ($298,073) ($1,615,352) ($618,841)
Loss Per Share ($0.28) ($0.06) ($0.32) ($0.17)
BOSTON RESTAURANT ASSOCIATES, INC. owns and operates a chain of
eight pizzerias under the name Pizzeria Regina and two Italian
restaurants named Bel Canto and Polcari's North End. The
restaurants are located in the Boston area.
CONTACT: Boston Restaurant Associates Inc.
Fran V. Ross, (617) 720-5684
George R. Chapdelaine, (617) 720-5684
or
L.G. Zangani Inc.
Leonardo G. Zangani, (908) 788-9660
SUNNYVALE, Calif., March 15, 1996 - Atari Corporation
(AMEX: ATC) reported today its results for the year and fourth
quarter ended December 31, 1995.
For the year ended 1995, NET SALES were $14.6 million compared
to $38.7 million for the year ended 1994. The sales decrease was
due to the poor sales of Jaguar, the Company's 64-bit multi-media
interactive entertainment system, and related software. The Company
reported a NET LOSS for 1995 of $49.6 million compared to NET INCOME
for 1994 of $9.4 million. The loss for 1995 is principally
attributable to substantial writedowns of inventory and software
development costs as well as substantially lower sales for the
Jaguar and related software.
For the fourth quarter ended December 31, 1995, NET SALES were
$2.8 million compared to $14.9 million for the fourth quarter of
1994. The Company reported a NET LOSS for the fourth quarter of 1995
of $27.7 million compared to NET INCOME of $17.6 million in the
fourth quarter of 1994. The income in the fourth quarter of 1994
was primarily from licensing technology to Sega Enterprises. The
loss for the 1995 quarter is attributable to substantial writedowns
of inventory and software development costs as well as substantially
lower sales for the Jaguar and related software.
PRELIMINARY FIRST QUARTER NEWS
In the first quarter of 1996, the Company sold the remaining
balance of its holdings in a publicly traded security, and realized
a gain of $6.1 million. Sales of Jaguar in the first quarter of
1996 continue to be poor. The Company, in late 1995, reduced the
price of the Jaguar to $99.95 and is presently test marketing
different price points and software bundles for the Jaguar in an
attempt to sell its inventory of such products. The Company has
also substantially reduced its workforce and curtailed its sales and
marketing and research and development activities.
ATARI CORPORATION AND JTS CORPORATION TO MERGE
On February 13, 1996, Atari Corporation and JTS Corporation
announced plans to merge the two companies. JTS is a manufacturer
of personal computer hard disk drives. "This merger puts us in a
great position to capitalize an a very experienced management team
and a rapidly growing disk drive market. JTS is using innovative
technology, particularly in the 3" disk drive market, and we are
excited about its prospects," said Jack Tramiel, Chairman of Atari.
Under the terms of the agreement, the new corporation will operate
under the name of JTS Corporation and the officers of JTS will
become the officers of the merged company. The Atari entertainment
business and the JTS disk drive business will operate as separate
divisions of the new merged company.
In connection with the merger Atari has extended a bridge loan
to JTS in the amount of $25 million. In the event that the merger
is not consummated, the bridge loan may be convertible into shares
of JTS Series A Preferred Stock at the option of Atari or JTS and
subject to certain conditions.
As a result of the transaction, Atari stockholders will hold
approximately 60% of the outstanding shares of the new company
following the merger. The transaction is structured to qualify as a
tax-free reorganization and will be accounted for as a purchase.
The boards of directors of Atari and JTS have approved the
definitive merger agreement. The merger is subject to certain
shareholder and regulatory approvals and other conditions to
closing. It is anticipated that the transaction will close toward
the end of the second calendar quarter of 1996.
Atari Corporation markets Jaguar, the only American made,
advanced 64-bit entertainment system, and licenses and markets
software in the multi-platform, multimedia market. Atari is located
in Sunnyvale, California.
The above statements regarding the disk drive industry and JTS'
prospects are forward looking statements and involve a number of
risks and uncertainties. Among the factors that would cause actual
results to differ materially are the following: business conditions
and growth in the portable computer industry and in the general
economy; competitive factors, including pricing pressures;
availability of components from third parties; risks associated with
manufacturing of products in India or other overseas jurisdictions
and risks associated with JTS' ability to ramp its manufacturing
operations, including cost and yield issues.
ATARI CORPORATION
Condensed Consolidated Statements of Operations
(in thousands, except per share)
Quarter Ended Twelve Months Ended
Dec. 31, Dec. 31, Dec. 31, Dec. 31,
1995 1994 1995 1994
Net Sales $ 2,801 $ 14,921 $ 14,626 $ 38,748
Operating Income (loss) $(29,816) $(12,595) $(53,665) $(24,047)
Exchange Gain (loss) 15 (5) 13 1,184
Other Income (Expense) Net 1,543 77 2,670 484
Settlement of Patent
Litigation -- 29,812 -- 32,062
Interest Income Net Of
Interest (Expense) 28 316 824 (289)
Income (Loss) Before
Extraordinary Credit $(28,230) $ 17,605 $(50,158) $ 9,394
Extraordinary Credit - gain
on extinguishment of
convertible subordinated
debentures $ 535 $ -- $ 582 $ --
Net Income (loss) $(27,695) $ 17,605 $(49,576) $ 9,394
Earnings Per Common and
Equivalent Share:
Income (loss) before
extraordinary credit $ (0.44) $ 0.30 $ (0.79) $ 0.16
Net Income (loss) $ (0.43) $ 0.30 $ (0.78) $ 0.16
Weighted Average number of
shares used in computation 63,686 59,460 63,697 58,962
TRENTON, Mich., March 15, 1996 - href="chap11.mclouth.html">McLouth Steel Products
Corporation announced today that effective March 16, 1996, it
would
commence an orderly shutdown of its operations to a hot-idle stage.
The Company, which has been operating under Chapter 11 of the U. S.
Bankruptcy Code since September 29, 1995, said it had exhausted
funds available for a continued operation.
The Company also announced that it plans to fulfill all existing
customer orders for which steel has been produced and plans to ship
those orders in the coming weeks. The Company is currently in the
process of informing customers and other constituencies as to the
current developments.
Over the past months, McLouth Steel has been in discussions with
potential investors regarding an acquisition and modernization of
the Company's operating facilities. The Company said that these
investors are in the midst of their due diligence investigations and
will continue these efforts over the next weeks.
McLouth Steel, based in Trenton, Michigan, is an integrated
steel manufacturer with operations in Trenton and Gibraltar,
Michigan. The Company has annual steelmaking capacity of
approximately 1 million tons.
CONTACT: McLouth Corporate Offices, 313-246-4002
SAN FRANCISCO, CA -- March 15, 1996 -- U.S. Electricar
Inc. (Symbol:ECAR) today announced its financial results for the
second quarter of fiscal year 1996 which ended Jan. 31, 1996.
For the quarter ended Jan. 31, 1996, U.S. Electricar reported
net sales of $917,000 and a net loss of $2,456,000 or $0.04 per
share, compared with fiscal year 1995 second quarter net sales of
$3,715,000 and a net loss of $16,495,000 or $0.90 per share.
The company indicated that the decline in both sales and net
loss could be attributed to the lack of available funding for
marketing and production and corporate downsizing which has occurred
since the company announced a restructuring of its operations, in
March 1995.
The company also announced that to date, creditors representing
approximately 75 percent of the outstanding unsecured trade debt,
have submitted aceptances to the debt restructuring plan. The
company is currently processing these acceptances.
The company is also negotiating with its major lenders to extend
the maturity dates of the approximately $20.0 million in convertible
debt and accrued interest, much of which is secured by the assets of
U.S. Elctricar. A significant portion of this debt was previously
restructured and matures in March and April 1996.
U.S. Electricar develops and manufactures electric vehicles for
markets in the United States and internationally, with products
ranging from converted sedans and light trucks to transit buses and
indutrial/commercial vehicles.
U.S. Electricar Inc. & Subsidiaries
Consolidated Statements of Operations
(Unaudited)
(In thousands, except for per share and share data)
Three Months Ended Six Months Ended
Jan. 31, Jan. 31,
1995 1996 1995 1996
Net Sales $3,715 $ 917 $ 9,897 $ 3,011
Cost of Sales 7,725 1,168 15,089 3,489
Gross Margin (4,010) (251) (5,192) (478)
Other costs and expenses
Research & Development 2,512 380 4,977 716
Selling, general &
administrative 5,087 1,446 8,794 2,683
Interest and financing
fees 2,608 486 3,709 913
Provision for facility
closures, consolidation
of operations &
contract terminations 2,278 -- 2,778 --
Total other costs and
expenses 12,485 2,312 20,258 4,312
Loss before gain on
debt restructuring (16,495) (2,563) (25,450) (4,790)
Gain on debt
restructuring -- 107 -- 390
Net Loss $(16,495) $(2,456) $(25,450) $(4,400)
Per common share:
Loss before gain on
debt restructuring $ (0.90) $(0.044) $ (1.48) $(0.084)
Gain on debt
restructuring -- 0.002 -- 0.007
Net loss per
common share $ (0.90) $(0.042) $ (1.48) $(0.077)
Weighted average
shares outstanding 18,361,287 58,220,984 17,237,013 56,873,171
SAN ANTONIO, Texas, March 15, 1996 - Tesoro Petroleum
Corporation (NYSE: TSO) today said its Board of Directors is sending
a letter to all Tesoro shareholders, urging careful consideration of
the facts before acting upon materials recently mailed to them by a
dissident group led by Kevin Flannery. The board reiterated its
recommendation that shareholders support Tesoro's current leadership
and strategy, and to either not give consents or revoke any consents
given to the Flannery group.
In the letter, Tesoro President and Chief Executive Officer
Bruce A. Smith tells stockholders: "Don't let the Flannery Group
mislead you into giving them control of your investment. Don't give
them the keys to the company so they can generate wealth for
themselves!"
The full text of Tesoro's letter follows.
Tesoro Petroleum Corporation is a natural resource company
engaged in natural gas exploration and production, petroleum
refining and marketing, and marine services.
March 15, 1996
Dear Fellow Shareholder:
The Stockholders' Committee for New Management of Tesoro
Petroleum Corporation (the "Flannery Group") JUST DOESN'T
UNDERSTAND! Recently, they wrote to you raising several issues to
which we want to respond.
WHAT HAS HAPPENED TO THE VALUE OF OUR STOCK?
While shareholder value is ultimately measured by the increase
in the price of Tesoro's stock, most investors understand that the
drivers of value are future earnings and cash flow. Since your
board put this management team in place in 1992, earnings and cash
flow have increased each year to record levels in 1995. So why
hasn't the stock price increased? It has, almost tripling since
1992. But what the Flannery Group fails to tell you, or understand,
is the negative impact that the 1995 Tennessee Gas decision by the
Texas Supreme Court had on our stock price. We believe much of the
30% decline they talk about can be linked to this adverse decision's
expected effect on future earnings. They want to avoid the issue
because, in management's view, this litigation might have been
settled were it not for Flannery's interference which led Tennessee
Gas to suspend negotiations with the company and close a window of
opportunity to settle the matter. If they don't understand the
fundamental effect of this issue on the stock (and debt), do you
want them working for you to create shareholder value?
THE REFINING AND MARKETING BUSINESS
The Flannery Group criticizes expenditures for Tesoro's refining
and marketing business. In earlier communications, the group
criticized the high-return, quick-payback vacuum unit, which has had
a positive impact that resulted in a contribution of approximately
$14 million in 1995. Excluding capital expenditures related to the
vacuum unit, Tesoro has generated positive operating cash flow in
excess of expenditures during the last three years. They also
criticize the $90 million of debt attributed to the refinery. This
is another half-truth since two-thirds of that amount represents the
settlement of a claim by the State of Alaska against the company for
approximately $100 million which threatened to bankrupt the company
and would have left shareholders with little or no value!
THE BOB WEST FIELD
The Flannery Group provides more half-truths concerning the
company's sale of a part of its Bob West Field interests. First
they criticized the sale. Then they applauded the sale. Now, they
criticize the sale again because the buyer announced it had
successfully drilled two new wells. The Flannery Group doesn't
understand economics. A successful well doesn't mean an adequate
return on investment will be received by shareholders. In fact, the
sale looks even better today because the sold properties are
producing below what we predicted and new wells are not even being
drilled as quickly as we predicted. Aggregate production from the
sold properties is almost 25% below levels at the time we sold. Do
you really want the lack of understanding demonstrated by the
Flannery Group to be applied to your investment in Tesoro?
A NEW BOARD OF DIRECTORS
The Flannery Group criticizes the director retirement plan,
which many public corporations the size of Tesoro have. But he says
it will potentially prompt "what will amount to a boardroom exodus."
Yet, he wants your consent to throw out the entire current board!
What does he really want? Under the governance guidelines adopted
by your board, by the 1996 annual meeting, Tesoro's Board of
Directors is expected to be comprised of two directors elected in
1996, one director named in 1995, three directors named in 1992, and
one director named in 1983. This is a new board!
THE FLANNERY GROUP HAS NO CREDIBLE PLAN FOR TESORO PETROLEUM
-- JUST TALK
Their only recommendation for increasing shareholder value is:
"The Alaskan Refining Business Should be Divested."
Original Mailing to Shareholders by Flannery Group
Now, after reading the company's materials, the Flannery Group
has changed its mind calling for
"Disposition of the Refining Business at the appropriate time...."
Latest Mailing to Shareholders by Flannery Group
The Flannery Group has finally agreed with us that a refinery
sale under current industry conditions destroys shareholder value.
Tesoro's management and industry experts have said that selling a
refinery now is a bad idea. Our refining and marketing business can
add value and we have a strategy which focuses on higher margin
products and expanding our marketing efforts while minimizing future
capital investment. Good management finds ways to improve cash flow
and earnings - that increases shareholder value!
THE FLANNERY GROUP ADMITS ITS "PLAN" MAY PRODUCE NO RESULTS FOR
SHAREHOLDERS
They have stated in their mailing that "the trading price of the
Common Stock is, of course, influenced by many factors and,
therefore, it is impossible to say with certainty that its price
will increase or to predict the amount of any such increase that
might occur."
It's obvious from 1995 results that management is having an
impact on what is in its control, but the same external forces that
have impacted the stock price under Tesoro's current management
would undoubtedly have a similar influence for the Flannery Group.
SEND THE GREEN CARD NOW
Don't let the Flannery Group mislead you into giving them
control of your investment. Don't give them the keys to the company
so they can generate wealth for themselves!
THE BOARD URGES YOU NOT TO SUPPORT THE FLANNERY GROUP IN ITS
ATTEMPT TO REMOVE AND REPLACE YOUR BOARD OF DIRECTORS AND URGES YOU
TO REVOKE ANY WHITE CONSENT CARD THAT MAY HAVE BEEN GIVEN.
If you have previously returned a white consent card, you have
every right to change your mind and revoke your consent by signing,
dating and returning the accompanying GREEN revocation of consent
card, using the enclosed postage-paid envelope. Even if you have
not previously signed or returned a white consent card to the
Flannery Group, you may sign and return a GREEN revocation of
consent card to Tesoro, which will have no legal effect but would
assist us in monitoring the progress of the Flannery Group's consent
solicitation.
Thank you for your support,
/s/ Bruce A. Smith
Bruce A. Smith
President and Chief
Executive Officer
CONTACT: Greg Wright of Tesoro Petroleum Corporation, 210-283-2440