TCR_Public/961031.MBX




InterNet Bankruptcy Library - News for October 31, 1996






Bankruptcy News For October 31, 1996



  1. SEER ANNOUNCES PRELIMINARY FISCAL FOURTH QUARTER RESULTS

  2. Cerplex announces third quarter results

  3. Eljer Industries announces record third quarter results and extension of debt agreement to 1998

  4. Egghead announces second-quarter results




SEER ANNOUNCES PRELIMINARY FISCAL FOURTH QUARTER RESULTS


CARY, N.C.--Oct. 31, 1996--Seer Technologies, Inc. (NASDAQ:SEER) today announced that based upon a
preliminary review of its results for the fiscal fourth quarter ended Sept. 30, 1996, the Company expects to report
total revenue of approximately $20 to $21 million and a net loss of approximately $16 to $17 million, or $1.39 to
$1.47 per share. For the same quarter a year ago, the Company posted revenue of $33.5 million and net income of
$2.4 million, or $.18 cents per share. Factors contributing to the loss include an approximately $7 million loss on
a write-down of assets resulting from a recent re-assessment of current operations by new management and the
fact that with the revenue shortfall, expenses for the period were out of alignment with the revenue base.


These are preliminary results. The Company plans to release final results for the quarter and the year on
November 7, 1996, which are subject to the completion of the independent annual audit.


"It is extremely disappointing to have to report these types of results," said Thomas A. Wilson, Seer's newly
appointed president and chief executive officer. "Lack of clear market definition, product plans and corporate
positioning over the past year has had a direct negative impact on sales."


"However, I have spent a great deal of time over the last six weeks meeting with customers, trade and financial
analysts, reviewing the current state of the business and analyzing the Company's performance for this past year.
We have begun our financial restructuring process to realign expenses with revenue and are working with
prominent trade analysts in defining our market position and strategy. The result of these efforts has given me a
high level of confidence about Seer's long-term future. I look forward to presenting more details about our plans
for next year in November," concluded Wilson.


Rob Minicucci, chairman of the board and general partner of Welsh, Carson, Anderson and Stowe, Seer's
majority stockholder, commented, "We are most supportive of Thomas' assessment of the business and are
confident that these initial steps, coupled with his future plans, will position the Company for success."


Except for any historical information contained herein, this news release contains forward looking statements that
involve risks and uncertainties, including the timely development, release and acceptance of new products and
alliances, the impact of competitive products and pricing, and the other risks detailed from time to time in the
Company's SEC reports, including the report on Form 10-K for the year ended September 30, 1995 and each of
the Company's 10-Qs filed in 1996. In particular, at its present stage of growth where its results depend upon a
small number of relatively large contracts, the Company is susceptible to potential significant variations in
quarterly revenues and net income as a result of the timing of contract closings.


CONTACT: Seer Technologies, Inc. Addie Kline, 919/380-5234




Cerplex announces third quarter results


TUSTIN, Calif.--Oct. 31, 1996-- The Cerplex Group Inc. (NASDAQ:CPLX), a leading provider of high
technology outsourcing services, on Thursday released results for the third quarter ended September 29, 1996.
Net sales increased 42.9% to $50.6 million from $35.4 million in the same quarter of fiscal 1995.


For the nine months ended September 29, 1996, net sales increased 40.1% to $142.8 million from $101.9 million
for the same period of fiscal 1995.For the third quarter ended September 29, 1996, the company reported a net
loss of $12.9 million or $.96 per share compared to a net loss of $25.0 million or $1.91 per share for the same
period of fiscal 1995.


For the nine months ended September 29, 1996, the company reported a net loss of $13.8 million or $1.04 per
share compared to a net loss of $23.9 million or $1.83 per share compared to the same period of fiscal 1995. The
losses reported for the same three months and nine months ended in fiscal 1995 include losses from discontinued
operations of $15.6 million and $15.4 million respectively.


The third quarter reflects, to a certain degree, the final resolution of several matters that have adversely impacted
the Company. In particular, the Company closed its unprofitable Texas operations and reached a settlement with
respect to the SpectraVision bankruptcy. The Company closed several other unprofitable operations and
businesses, resulting in restructuring charges and asset write downs.


Due to changes in the Company's business, or the business of third parties, the Company recorded charges for
inventory writedowns, uncollectable receivables and other assets. The losses in the third quarter are also
attributable to higher interest expenses and a variety of other factors.


Sales growth is primarily attributable to acquisitions completed earlier this year. North American sales
experienced a drop-off, primarily due to closing of unprofitable operations, product lines and related facility
consolidations.


As previously disclosed in its filings with the Securities and Exchange Commission, Cerplex also announced that
it was in violation of certain financial covenants under its senior credit agreement and subordinated note
agreements which constitutes an event of default under such agreements.


The Company has received waivers from these lenders through November 30, 1996, while the Company
negotiates amendments to these agreements. Further, the Company's tangible net worth has fallen below the
minimum requirements for listing on the Nasdaq National Market. Discussions have been initiated between
Cerplex and the NASD regarding this matter.


William A. Klein, Cerplex's Chairman, President and Chief Executive Officer, stated: "During 1995 and 1996,
the Company has been in the process of revising its service model. In 1995, the Company discontinued its
end-of-life business. During 1996, we began refocusing our operations on providing services which were less
inventory intensive while downsizing or closing unprofitable operations.


"In addition, due to collection problems with SpectraVision, which filed for bankruptcy, and several other
customers, we began tightening our credit standards and revising our targeted customer profile. While we believe
that these changes have provided the Company with an enhanced model and a more efficient platform to service
our customers, operational issues based on our former business model, and other factors have impacted, and will
in the near term continue to impact, our financial condition and results of operations."


Klein continued: "We strongly believe in the fundamentals of our industry and believe that our refocusing on a
revised service model to top quality customers is paying off. In the last quarter we have brought on-line our new
Ontario, Calif., hub with Hewlett-Packard as our anchor customer. We have commenced operations in our new
Louisville, Ky., hub and have started servicing new customers.


"We have also entered into a new agreement with Digital Equipment Corp. and are negotiating several other
agreements with other high quality customers. We believe that these new opportunities will alone provide in
excess of $25 million in business in fiscal 1997."


About Cerplex


Cerplex is a leading independent provider of service outsourcing, including repair and remanufacturing, and parts
and logistics services. The company has developed extensive capabilities in these areas, focusing on the
computer and peripherals, telecommunications and office automation markets. Cerplex offers custom developed
programs to OEM and TPM customers that help to reduce their service costs, shorten response times, and
improve customer satisfaction. The Company's headquarters is located in Tustin, Calif., with service facilities
throughout the United States and Europe. Visit Cerplex's homepage at www.cerplex.com.


NOTE: This news story contains forward-looking statements that involve risks and uncertainties. The Company's
actual results may differ significantly from the results discussed in the forward-looking statements.


Forward looking statements include statements regarding Cerplex's projected revenues next year, the
renegotiation of the Company's credit facilities and discussions with the NASD. There can be no assurances the
Company will be able to generate projected revenues in 1997, renegotiate its credit facilities or maintain its
Nasdaq National Market listing.


Factors that might cause such differences include, but are not limited to, the effect of losses and other factors on
the Company's credit facilities, business and results of operations; the Company's limited capital resources and
its ability to fulfill its existing obligations and ongoing capital needs; risks associated with excess or obsolete
inventory; the potential impairment of assets; the Company's dependence on key customers and their financial
viability; the impact of competition; and the Company's ability to effectively manage growth.


These and other risk factors are discussed in the Company's filing on Forms 8-K, 10-Q, and 10-K.


Executives at Cerplex are available for interview.


      

                          THE CERPLEX GROUP INC.
                             and Subsidiaries
        

                  CONSOLIDATED STATEMENTS OF OPERATIONS
                  (in thousands, except per share data)
        

                                   Three Months          Nine Months
                                  Ended Sept. 29       Ended Sept. 29
                                 1996       1995       1996       1995
        

        Net Sales                 $ 50,636   $ 35,381    $142,821   $101,870
        Cost of Sales               46,885     32,450     121,170     86,888
        Gross Profit                 3,751      2,931      21,651     14,982
        Selling, general &
          administrative expenses   12,233     13,191      27,872     22,502
        Restructuring charges        2,084                  2,084
        Operating income (loss)    (10,566)   (10,260)     (8,305)
        (7,520)
        Equity in earnings from
          joint venture                 --        347         357      1,506
        Gain on Sale of InCirT
          Division                      --                    450
        Interest expense             1,811      1,295       4,980      3,740
        Income (loss) from
          continuing operations
          before taxes             (12,377)   (11,208)    (12,478)
        (9,754)
        Income taxes                   563     (1,775)      1,333
        (1,281)
        Income (loss) from
          continuing operations    (12,940)    (9,433)    (13,811)
        (8,473)
        Discontinued operations,
          net of income taxes:
          Income (loss) from operations --     (2,118)
        --     (1,965)      
          Estimated loss from liquidation
        of discontinued operations  --    (13,446)         --    (13,446)   
          Income (loss) from
        discontinued operations     --    (15,564)         --    (15,411)
        Net income (loss)         $(12,940)  $(24,997)  $ (13,811)
        $(23,885)
        

        Income (loss) per share:
          Continuing operations   $  (0.96)  $  (0.72)  $   (1.04)  $
        (0.65)
          Discontinued operations       --      (1.19)
        --      (1.18)
        

        Net income (loss) 
          per share               $  (0.96)  $  (1.91)  $   (1.04)  $
        (1.83)
        

        Weight average common and 
          common equivalent shares  13,422     13,108      13,332     13,081
        

        -0-
        

                         THE CERPLEX GROUP, INC. 
                            and Subsidiaries
                       CONSOLIDATED BALANCE SHEET
                  (in thousands, except per share data)
        

                                        Sept. 29,           Dec. 31,
                                          1996                1995
        

                                 ASSETS
         

        Current Assets:
         Cash and cash equivalents          $ 26,521            $  3,807
         Accounts receivable, net             23,301              30,102
         Inventories                          22,674              27,789
         Net assets of discontinued
          operations                             412               2,597
         Prepaid expenses and other            7,116               2,267
         Total current assets             80,024              66,562
        

        Property, plant and equipment, net    28,390              17,988
        Investment in joint venture              ---               7,723
        Goodwill                               5,682               6,647
        Other long-term assets                 3,804               2,973
         Total assets                   $117,900            $101,893
        

               
                     LIABILITIES AND STOCKHOLDERS' EQUITY     
        

        Current liabilities:
         Accounts and notes payable         $ 24,410            $ 17,024
         Accrued liabilities                  24,990              13,622
         Short-term borrowings                45,188            
         Current portion of long-term debt       241                 536
         Income taxes payable                  1,296               2,161
         Total current liabilities        96,125              33,343
        

        Long-term debt, less current portion  18,033              68,382
        Other long-term liabilities            6,214
        

        Stockholders' Equity:
         Convertible Series B preferred stock,
          par value $.001; 8,000 shares
          authorized and outstanding           7,859
         Common stock, par value $.001;           13                  13
          30,000,000 shares authorized;
          13,440,011 and 13,127,680
          issued and outstanding in 1996
          and 1995                                                    
         Additional paid-in capital           50,645              47,528
         Notes receivable from stockholders     (139)               (226)
         Unearned compensation                   (90)               (143)
         Accumulated deficit                 (60,837)            (47,026)
         Cumulative translation adjustments       77                  22
          Total stockholders' equity          (2,472)                168
        

        Total liabilities and stockholders' 
         equity                             $117,900            $101,893
        

              

CONTACT: Cerplex, Tustin Ray Robidoux, Senior Vice President, Marketing 714/258-5644
rrobidou@cerplex.com




Eljer Industries announces record third quarter results and extension of debt agreement to 1998


DALLAS, TX--Oct. 31, 1996--Eljer Industries, Inc. (NYSE:ELJ) today reported record earnings for the third
quarter and nine months ended September 29, 1996.


For the third quarter, net income reached $7,390,000, or $1.03 per share, compared with net income in the third
quarter of 1995 of $4,522,000, or $0.63 per share. Income from operations increased 72% to $10,412,000 in the
third quarter of 1996 from $6,060,000 in the third quarter of 1995, excluding a one-time nonrecurring gain of $2.7
million resulting from pension plan amendments recorded in the third quarter of 1995. Net sales for the 1996
third quarter of $103,973,000, increased $1.2 million compared with $102,752,000 reported in the third quarter
of 1995.


For the first nine months of 1996, net income was $10,328,000, or $1.43 per share, on net sales of $290,370,000,
compared with net income of $2,434,000, or $0.34 per share, on net sales of $294,223,000 in the same period of
1995. Operating income was $21,509,000 compared with $14,378,000 in the first nine months of 1995.


Third quarter sales were favorably affected by continued strong U.S. housing starts, partially offset by the
lingering impact of the 11-week strike at our Salem, Ohio, cast iron facility earlier this year. The strike and
related shut-down resulted in a delay in the plant's ability to return to full capacity, negatively impacting
shipments of our cast iron product. Newly introduced products are proving to be very successful both in terms of
additional volume and higher margins. The QestPEX line of flexible plumbing systems introduced earlier this
year remains one of our strongest new products. We are successfully cross-marketing our products into existing
retail channels. Sales of our HVAC products through the retail market improved 82% in the third quarter of 1996
compared to the 1995 third quarter primarily as a result of selling these products to existing plumbingware retail
customers. Gross profit margins also improved as a result of a more stable raw material market and price
increases implemented last year in response to the substantially higher raw material prices experienced in early
1995.


Litigation costs decreased approximately $1.6 million in the third quarter of 1996 compared to the same period in
1995 due to reduced legal activity, including the settlement reached with Household International, Inc. in the
second quarter.


In Octob er the Bankruptcy Court for the bankruptcy proceedings of United States Brass Corporation, our indirect,
wholly-owned subsidiary, ordered deadlines for filing amendments or supplements to previous plans or for filing
new plans. New plans of reorganization and new disclosure statements or amendments to previously filed plans
of reorganization or disclosure statements are to be filed on or before November 29, 1996. Objections to any
amended or supplemental information contained in the disclosure statements must be filed by December 31, 1996
and a hearing will be held on the submitted disclosure statements on January 22, 1997. U.S. Brass is currently
preparing a Third Amended Brass Plan and Disclosure Statement embodying the terms of the tentative settlement
reached in connection with the previously disclosed national class action settlement agreement.


In addition, on October 30, 1996, the Company successfully completed negotiation of an amendment to the U.S.
term debt agreement extending the maturity of the debt to January 1998 from January 1997. At September 29,
1996, the Company had outstanding term debt of $50.9 million. Under the terms of the amendment, scheduled
principal payments totaling $5.0 million are due in 1997 with the balance becoming due on the January 31, 1998,
maturity date. A fee equal to approximately 1% of the outstanding loan balance was paid by Eljer at the closing
of the amendment to the agreement.


Scott Arbuckle, Chairman and Chief Executive Officer, commented: "We are very pleased with the strong
performance of all our business units during the quarter. The cross-marketing of our products into the retail and
wholesale channels are proving effective in expanding volume potential. In addition, the order rate of new
products continues to help our sales in the highly competitive U.S. market. We are pleased as well with our bank
group's ongoing cooperation evidenced by their extending the maturity date an additional year. Our primary goal
now is the final resolution of the U.S. Brass issues while continuing the momentum of improved earnings
performance."


Eljer Industries, Inc. is a leading manufacturer and marketer of high quality building products, including
plumbing, heating and ventilation products, for the residential and commercial construction, remodeling and
repair, and do-it-yourself markets.


                ELJER INDUSTRIES, INC. AND SUBSIDIARIES
                      CONDENSED STATEMENTS OF INCOME
                               (unaudited)
                (In thousands, except per share amounts)
        

                                    For the Three Months   For the Nine Months 
                                            Ended               Ended
                                     9/29/96   10/1/95    9/29/96    10/1/95
        

        NET SALES                       $103,973  $102,752   $290,370
        $294,223
        

        COST OF SALES                     73,138    74,016    213,124
        219,279
        

        GROSS PROFIT                      30,835    28,736     77,246
        74,944
        

        SELLING & ADMINISTRATIVE                                       
        EXPENSES                      18,744    17,679     56,373     56,098
        

        LITIGATION COSTS (SETTLEMENTS),
        net                              299     1,869     (2,868)     6,362
        

        UNUSUAL ITEM - U.S. BRASS
        BANKRUPTCY ADJUSTMENT          1,380       348       2,232    (1,894)
        

        INCOME FROM OPERATIONS            10,412     8,840      21,509
        14,378
        

        OTHER EXPENSE, net                   186       321         418
        1,252
        

        INTEREST EXPENSE, net              2,221     3,441       8,184
        10,106
        

        INCOME BEFORE INCOME 
        TAXES                          8,005     5,078      12,907     3,020
        

        INCOME TAX EXPENSE                   615       556       2,579
        586
        

        NET INCOME                      $  7,390  $  4,522    $ 10,328   $
        2,434
        

        NET INCOME PER SHARE            $   1.03  $   0.63    $   1.43   $
        0.34
        

        WEIGHTED AVERAGE NUMBER OF
         COMMON SHARES                 7,204     7,137       7,206     7,132
        

        


CONTACT: Eljer Industries, Inc. Brooks Sherman Chief Financial Officer (972) 407-2600 or Linda Pankewicz
(972) 407-2604 or Morgen-Walke Associates Lynn Morgen / June Filingeri Stan Froelich, Media Contact (212)
850-6500




Egghead announces second-quarter results


SPOKANE, Wash.--Oct. 31, 1996--Egghead Inc. (NASDAQ:EGGS) today reported results for its second quarter
ended Sept. 28, 1996. These results exclude the discontinued operations of the Corporate Government and
Educational division (CGE), which was sold on May 13, 1996.


The company's consolidated revenue from continuing operations for the second quarter was $80.0 million, a
decrease of 21% from the $100.6 million last year. Net loss for the second quarter from continuing operations
was $4.7 million, or $0.27 per share, compared to a net loss of $3.1 million, or $0.17 per share last year.


For the six months, the company's consolidated revenue from continuing operations was $158.6 million, a
decrease of 14% from the $185.3 million from last year. Net loss from continuing operations for the six months
was $12.2 million, or $0.70 per share, compared to a net loss of $6.3 million, or $0.37 per share last year.


Comparable store sales for the second quarter decreased 22.2% from last year. For the six months comparable
store sales decreased 15.1% from last year. Comparable store sales results only include Egghead's retail stores.
Excluded are sales through Direct Response and the Egghead Internet site (www.egghead.com).


Total and comparable store sales performance for the quarter was adversely affected by the launch of Windows
95 last year and a reduction in the average number of stores in operation this year. For the second quarter
comparable store sales decreased 17.2% excluding the sales of Windows 95 in both periods but not Windows 95
related products introduced during the Windows 95 launch period.


Analogously for the six months comparable store sales decreased 12.2% excluding the sales of Windows 95 in
both years. The average number of stores in operation during the second quarter this year was 157, down from
164 stores last year. At Sept. 28, 1996, there were 154 stores in operation.


During the second quarter Egghead formalized plans to remodel 12 of the company's previous new format (C-3)
stores to its C-4 format and convert one store to the C-4 format and open three new C-4 format stores in existing
markets. The C-4 format is a more open store whose fixture arrangement holds more merchandise and affords
greater flexibility in displaying and organizing each category. The company is also modifying an additional 12
stores, 10 of which consist of C-3 stores in new markets.


All 28 of these stores will carry broader merchandise assortments, including hardware, than the company's
traditional store. Several of them also serve as pilot sites for upgrade and installation departments and walk-in
sales from surrounding businesses. The hardware assortments include computer systems, notebook computers,
monitors, printers, scanners, and digital imaging devices. Management expects to effect these changes prior to the
upcoming holiday selling season.


As the company has previously stated, the performance of the remodeled and expanded stores in existing markets
is better on balance than that of new stores in new markets. Egghead's Chairman George P. Orban said, "With this
initiative we are moving to reposition some key stores in time for the holiday season. We are focusing our
attention on our new format stores which may serve as the model for redeveloping the rest of the chain as the
majority of the company's leases come up for renewal in the next 18 months."


Total gross margin for the quarter was $8.2 million or 10.2% of sales compared to $11.2 million or 11.1% of
sales last year. For the six months gross margin was $14.8 million or 9.3% of sales compared to $21.2 million or
11.4% of sales last year. For the quarter and six months the initial margin ratio was higher by 1.4 and 0.8
percentage points respectively, however, gross margin contribution was lower primarily due to the sales
decrease. Initial margin ratio in the prior year was negatively affected by the low gross margin associated with
Windows 95.


The company's selling, general and administrative expense (SG&A) for the quarter was $15.0 million, a decrease
of $0.3 million from the $15.3 million last year. The company has reduced its administrative and corporate
headquarters expenses, however, the recognition of co-op advertising reimbursements was below last year's
level.


For the six months SG&A expense was $33.0 million, an increase of $3.5 million from the $29.5 million last
year. Consistent with the results for the quarter, reduction in administration and corporate headquarters expense
were offset by lower co-op advertising reimbursements. Six-months results also include several one-time
restructure costs that were recorded in the first quarter this year.


The company's balance sheet remains strong primarily due to a cash balance of $81.9 million at Sept. 28, 1996.
For the six months the company's cash position has improved by $32.3 million primarily as a result of the sale of
CGE in the first quarter and the subsequent of collection of accounts receivable.


These improvements in the cash balance was partially offset by an increase in inventory as the company prepares
for the important upcoming holiday selling season, and a decline in accounts payable.


Egghead also announced that Edward S. Wozniak, the company's Vice President, Chief Financial Officer and
Secretary has accepted a position as Vice President, Chief Administrative Officer of another company. Egghead
is in discussion with a highly qualified candidate to replace Wozniak and expects to make an announcement
shortly.


This news release contains forward-looking statements that involve risks and uncertainties, including risks
related to the highly competitive nature of the computer software, hardware and other related products retailing
industry, the seasonality and quarterly fluctuation of financial results, the early stage of the company's new store
format, the dependence of the company's sales on the purchase and use of personal computers and software, and
the development stage of the company's subsidiary ELEKOM, and the risks detailed in the company's SEC
reports, including the report on Form 10-K for the year ended March 30, 1996 and the report on Form 10-Q for
the quarter ended June 29, 1996. Actual results may differ materially.


                         EGGHEAD INC. AND SUBSIDIARIES
                     Consolidated Statements of Operations
                  (Amounts in thousands, except per-share data)
        

                                 13 Weeks Ended        26 weeks Ended
                                   (unaudited)           (unaudited)
                                Sep 28,    Sep 30,    Sep 28,    Sep 30,
                                 1996       1995       1996       1995
        

        Net sales                   $79,971   $100,617   $158,617   $185,307
        Cost of sales, including
         certain buying, occupancy,
         and distribution
         costs                       71,786     89,418    143,822    164,136
        

        Gross margin                  8,185     11,199     14,795     21,171
        Selling, general, and
         administrative expense      15,015     15,256     32,949     29,542
        Depreciation and
         amortization expense, net
         of amounts included in
         cost of sales                1,766      1,815      3,513      3,616
        

        Operating income (loss)      (8,596)    (5,872)   (21,667)
        (11,987)
        Other income (expense):
         Interest income                992        890      1,791      1,583
          Interest expense               (9)       (16)       (22)
        (37)
          Other, net                    (23)        13       (154)        68
        Loss from continuing
         operations before income
         taxes                       (7,636)    (4,985)   (20,052)
        (10,373)
        

        Income tax benefit            2,978      1,933      7,820      4,035
        Net loss from continuing
         operations before effects of
         discontinued operations and
         cumulative effect
         of change in accounting
         principle                   (4,658)    (3,052)   (12,232)
        (6,338)
        Discontinued operations:
         Income (loss) from
         discontinued
         operations, net of tax                   (462)   (14,548)
        (338)
          Gain on disposal of
           discontinued operations,
           net of tax                                      22,286
        Income from discontinued
         operations                               (462)     7,738
        (338)
        

        Net income before cumulative 
         effect of change in
         accounting principles       (4,658)    (3,514)    (4,494)
        (6,676)
        Cumulative effect of change
         in accounting principles
         net of tax                                          (711)
        Net Income (loss)           $(4,658)   $(3,514)   $(5,205)
        $(6,676)
        

        Earnings (loss) per share:
          Continuing operations       (0.27)     (0.17)     (0.70)
        (0.37)
          Discontinued operations:
          Income (loss) from
           discontinued operations               (0.03)     (0.83)
        (0.02)
          Gain on disposal of
           discontinued operations                           1.27
          Change in accounting
           principle                                        (0.04)
        

        Earnings (loss) per
         share                       $(0.27)    $(0.20)    $(0.30)   $
        (0.39)
        Weighted average common
         shares and common
         equivalent
         shares outstanding          17,567     17,490     17,561     17,331
        

                            EGGHEAD INC. AND SUBSIDIARIES
                             Consolidated Balance Sheets
                                (Dollars in thousands)
        

        ASSETS
                                       Sep 28, 1996  Mar 30, 1996
        

        Current assets:
          Cash and cash equivalents          $  81,920     $  49,590
          Non-trade accounts receivables,
           net of allowance for
        doubtful accounts of
         $3,472 and $2,098,
          respectively                      17,534        24,079
          Merchandise inventories, net          99,232        84,712
          Prepaid expenses and other current
           assets                               13,129         9,455
          Current deferred income taxes          5,612         4,859
          Discontinued operations - net current
           assets                                2,392        74,473
        Total current assets               219,819       247,168
        

        Property and equipment, net             24,950        29,495
        Non-current deferred income taxes        4,221         4,221
        Other assets                               512         1,621
        Discontinued operations -
         net long-term assets                       --         1,727
                                         $ 249,502     $ 284,232
        

        LIABILITIES AND SHAREHOLDERS' EQUITY
        

        Current liabilities:
          Notes payable to banks             $      --     $      --
          Accounts payable                      82,722       119,341
          Accrued liabilities                   12,895        15,817
          Current portion of capital
           lease obligations                       307           295
          Liabilities related to CGE disposal   18,559         8,327
        Total current liabilities          114,483       143,780
        

        Capital lease obligations, 
         less current portion                       95           280
        Deferred rent                              709           903
        

          Total liabilities                    115,287       144,963
        

        Commitments and contingencies               --            --
        

        Shareholders' equity :
          Common stock, $.01 par value:
        50,000,000 shares authorized;
         17,573,920 and 17,546,548 shares
          issued and outstanding,
           respectively                        176           176
          Additional paid-in capital           124,295       124,104
          Retained earnings                      9,744        14,989
        Total shareholders' equity         134,215       139,269
                                         $ 249,502     $ 284,232
                      

CONTACT: Egghead Inc. Ed Wozniak, CFO, 509/891-4851 or Bob Sundmacher, Corporate Communications,
206/728-1778