Document_And_Entity_Informatio
Document And Entity Information (USD $) | 12 Months Ended | |||
In Millions, except Share data, unless otherwise specified | Feb. 01, 2014 | Aug. 03, 2013 | Apr. 11, 2014 | Apr. 11, 2014 |
Common stock, Class A voting | Common stock, Class B nonvoting | |||
Document Information [Line Items] | ' | ' | ' | ' |
Entity Registrant Name | 'FREDS INC | ' | ' | ' |
Entity Central Index Key | '0000724571 | ' | ' | ' |
Current Fiscal Year End Date | '--02-01 | ' | ' | ' |
Entity Filer Category | 'Accelerated Filer | ' | ' | ' |
Trading Symbol | 'FRED | ' | ' | ' |
Entity Common Stock, Shares Outstanding | ' | ' | 36,798,897 | 0 |
Document Type | '10-K | ' | ' | ' |
Amendment Flag | 'false | ' | ' | ' |
Document Period End Date | 1-Feb-14 | ' | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' | ' |
Entity Voluntary Filers | 'No | ' | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' | ' |
Entity Public Float | ' | $635 | ' | ' |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Feb. 01, 2014 | Feb. 02, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $6,725 | $8,129 |
Receivables, less allowance for doubtful accounts of $2,097 and $1,994, respectively | 35,161 | 35,438 |
Inventories | 361,993 | 353,266 |
Other non-trade receivables | 37,490 | 33,273 |
Prepaid expenses and other current assets | 13,245 | 13,134 |
Total current assets | 454,614 | 443,240 |
Property and equipment, less accumulated depreciation and amortization | 153,363 | 158,394 |
Equipment under capital leases, less accumulated amortization of $5,111 and $5,077, respectively | 29 | 63 |
Intangible assets, net | 54,580 | 41,873 |
Other noncurrent assets, net | 3,582 | 3,078 |
Total assets | 666,168 | 646,648 |
Current liabilities: | ' | ' |
Accounts payable | 125,925 | 115,325 |
Current portion of indebtedness | 1,640 | 1,263 |
Accrued expenses and other | 44,618 | 44,000 |
Deferred income taxes | 24,446 | 24,234 |
Total current liabilities | 196,629 | 184,822 |
Long-term portion of indebtedness | 3,578 | 12,241 |
Deferred income taxes | 0 | 4,732 |
Other noncurrent liabilities | 14,413 | 13,581 |
Total liabilities | 214,620 | 215,376 |
Commitments and contingencies (see Note 3-Indebtedness, Note 6-Long-Term Leases and Note 10-Other Commitments and Contingencies) | ' | ' |
Shareholders' equity: | ' | ' |
Retained earnings | 348,321 | 331,136 |
Accumulated other comprehensive income | 703 | 794 |
Total shareholdersb equity | 451,548 | 431,272 |
Total liabilities and shareholders' equity | 666,168 | 646,648 |
Preferred stock, nonvoting | ' | ' |
Shareholders' equity: | ' | ' |
Preferred stock | 0 | 0 |
Preferred stock, Series A junior participating nonvoting | ' | ' |
Shareholders' equity: | ' | ' |
Preferred stock | 0 | 0 |
Common stock, Class A voting | ' | ' |
Shareholders' equity: | ' | ' |
Common stock | 102,524 | 99,342 |
Common stock, Class B nonvoting | ' | ' |
Shareholders' equity: | ' | ' |
Common stock | $0 | $0 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Feb. 01, 2014 | Feb. 02, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Receivables, allowance for doubtful accounts (in dollars) | $2,097 | $1,994 |
Equipment under capital leases, accumulated amortization (in dollars) | $5,111 | $5,077 |
Preferred stock, nonvoting | ' | ' |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, outstanding | 0 | 0 |
Preferred stock, Series A junior participating nonvoting | ' | ' |
Preferred stock, shares authorized | 224,594 | 224,594 |
Preferred stock, outstanding | 0 | 0 |
Common stock, Class A voting | ' | ' |
Common stock, shares authorized | 60,000,000 | 60,000,000 |
Common stock, shares issued | 36,791,279 | 36,680,060 |
Common stock, shares outstanding | 36,791,279 | 36,680,060 |
Common stock, Class B nonvoting | ' | ' |
Common stock, shares authorized | 11,500,000 | 11,500,000 |
Common stock, shares outstanding | 0 | 0 |
CONSOLIDATED_STATEMENTS_OF_INC
CONSOLIDATED STATEMENTS OF INCOME (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 |
Net sales | $1,939,246 | $1,955,275 | $1,879,059 |
Cost of goods sold | 1,378,405 | 1,388,943 | 1,340,519 |
Gross profit | 560,841 | 566,332 | 538,540 |
Depreciation and amortization | 41,047 | 39,541 | 34,190 |
Selling, general and administrative expenses | 480,596 | 487,713 | 453,195 |
Operating income | 39,198 | 39,078 | 51,155 |
Interest income | 0 | 0 | -156 |
Interest expense | 487 | 549 | 553 |
Income before income taxes | 38,711 | 38,529 | 50,758 |
Provision for income taxes | 12,696 | 8,900 | 17,330 |
Net income | 26,015 | 29,629 | 33,428 |
Net income per share | ' | ' | ' |
Basic (in dollars per share) | $0.71 | $0.81 | $0.88 |
Diluted (in dollars per share) | $0.71 | $0.81 | $0.87 |
Weighted average common shares outstanding | ' | ' | ' |
Basic (in shares) | 36,558 | 36,584 | 38,176 |
Effect of dilutive stock options (in shares) | 162 | 127 | 92 |
Diluted (in shares) | 36,720 | 36,711 | 38,268 |
Comprehensive income: | ' | ' | ' |
Net income | 26,015 | 29,629 | 33,428 |
Other comprehensive income (expense), net of tax Postretirement plan adjustment | -91 | -70 | -8 |
Comprehensive income | $25,924 | $29,559 | $33,420 |
CONSOLIDATED_STATEMENTS_OF_CHA
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (USD $) | Total | Common Stock [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
In Thousands, except Share data | ||||
Balance at Jan. 29, 2011 | $423,888 | $131,367 | $291,649 | $872 |
Balance (in shares) at Jan. 29, 2011 | ' | 39,300,872 | ' | ' |
Cash dividends paid | -7,713 | ' | -7,713 | ' |
Restricted stock grants, cancellations and withholdings, net | -285 | -285 | ' | ' |
Restricted stock grants, cancellations and withholdings, net (in shares) | ' | 280,156 | ' | ' |
Issuance of shares under employee stock purchase plan | 571 | 571 | ' | ' |
Issuance of shares under employee stock purchase plan (in shares) | ' | 52,526 | ' | ' |
Repurchased and cancelled shares | -28,482 | -28,482 | ' | ' |
Repurchased and cancelled shares (in shares) | ' | -2,447,823 | ' | ' |
Stock-based compensation | 2,075 | 2,075 | ' | ' |
Exercises of stock options | 165 | 165 | ' | ' |
Exercises of stock options (in shares) | 18,063 | 18,063 | ' | ' |
Income tax benefit/expense on exercise of stock options | -27 | -27 | ' | ' |
Adjustment for postretirement benefits (net of tax) | -8 | ' | ' | -8 |
Net income | 33,428 | ' | 33,428 | ' |
Balance at Jan. 28, 2012 | 423,612 | 105,384 | 317,364 | 864 |
Balance (in shares) at Jan. 28, 2012 | ' | 37,203,794 | ' | ' |
Cash dividends paid | -15,857 | ' | -15,857 | ' |
Restricted stock grants, cancellations and withholdings, net | -481 | -481 | ' | ' |
Restricted stock grants, cancellations and withholdings, net (in shares) | ' | 3,743 | ' | ' |
Issuance of shares under employee stock purchase plan | 657 | 657 | ' | ' |
Issuance of shares under employee stock purchase plan (in shares) | ' | 54,830 | ' | ' |
Repurchased and cancelled shares | -9,176 | -9,176 | ' | ' |
Repurchased and cancelled shares (in shares) | ' | -649,219 | ' | ' |
Stock-based compensation | 2,055 | 2,055 | ' | ' |
Exercises of stock options | 933 | 933 | ' | ' |
Exercises of stock options (in shares) | 66,912 | 66,912 | ' | ' |
Income tax benefit/expense on exercise of stock options | -30 | -30 | ' | ' |
Adjustment for postretirement benefits (net of tax) | -70 | ' | ' | -70 |
Net income | 29,629 | ' | 29,629 | ' |
Balance at Feb. 02, 2013 | 431,272 | 99,342 | 331,136 | 794 |
Balance (in shares) at Feb. 02, 2013 | ' | 36,680,060 | ' | ' |
Cash dividends paid | -8,830 | ' | -8,830 | ' |
Restricted stock grants, cancellations and withholdings, net | -342 | -342 | ' | ' |
Restricted stock grants, cancellations and withholdings, net (in shares) | ' | -31,062 | ' | ' |
Issuance of shares under employee stock purchase plan | 712 | 712 | ' | ' |
Issuance of shares under employee stock purchase plan (in shares) | ' | 60,912 | ' | ' |
Stock-based compensation | 1,791 | 1,791 | ' | ' |
Exercises of stock options | 998 | 998 | ' | ' |
Exercises of stock options (in shares) | 81,369 | 81,369 | ' | ' |
Income tax benefit/expense on exercise of stock options | 23 | 23 | ' | ' |
Adjustment for postretirement benefits (net of tax) | -91 | ' | ' | -91 |
Net income | 26,015 | ' | 26,015 | ' |
Balance at Feb. 01, 2014 | $451,548 | $102,524 | $348,321 | $703 |
Balance (in shares) at Feb. 01, 2014 | ' | 36,791,279 | ' | ' |
CONSOLIDATED_STATEMENTS_OF_CHA1
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||
Feb. 01, 2014 | Nov. 02, 2013 | Aug. 03, 2013 | 4-May-13 | Feb. 02, 2013 | Oct. 27, 2012 | Jul. 28, 2012 | Apr. 28, 2012 | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 | |||||
Cash dividends paid (in dollars per share) | $0.06 | $0.06 | $0.06 | $0.06 | $0.25 | [1] | $0.06 | [1] | $0.06 | [1] | $0.06 | [1] | $0.24 | $0.43 | $0.20 |
[1] | The $0.25 cash dividend per share paid in the fourth quarter of 2012 consists of a one-time special dividend of $0.19 and the $0.06 regular quarterly dividend. |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 |
Cash flows from operating activities: | ' | ' | ' |
Net income | $26,015 | $29,629 | $33,428 |
Adjustments to reconcile net income to net cash flows from operating activities: | ' | ' | ' |
Depreciation and amortization | 41,047 | 39,541 | 34,190 |
Net (gain) loss on asset disposition | -3,972 | -471 | -2,761 |
Provision (recovery) for store closures and asset impairment | 1,700 | -67 | 112 |
Stock-based compensation | 1,791 | 2,055 | 2,075 |
Provision (recovery) for uncollectible receivables | 103 | -106 | 447 |
LIFO reserve increase | 4,526 | 3,937 | 2,792 |
Deferred income tax (benefit) expense | -5,165 | -583 | 6,462 |
Income tax (charge) benefit upon exercise of stock options | -23 | 30 | 27 |
Benefit for postretirement medical | -82 | -91 | -85 |
(Increase) decrease in operating assets: | ' | ' | ' |
Trade and non-trade receivables | -3,596 | -7,490 | -8,313 |
Insurance receivables | 298 | -273 | 205 |
Inventories | -14,953 | -25,254 | -21,402 |
Other assets | -111 | -615 | 607 |
Increase (decrease) in operating liabilities: | ' | ' | ' |
Accounts payable and accrued expenses | 11,218 | 8,068 | 25,464 |
Income taxes payable | -921 | 2,627 | -1,719 |
Other noncurrent liabilities | 986 | -6,187 | 1,801 |
Net cash provided by operating activities | 58,861 | 44,750 | 73,330 |
Cash flows from investing activities: | ' | ' | ' |
Capital expenditures | -25,918 | -27,391 | -45,681 |
Proceeds from asset dispositions | 6,267 | 1,593 | 3,354 |
Insurance recoveries for replacement assets | 176 | 0 | 0 |
Asset acquisitions, net (primarily intangibles) | -25,066 | -20,203 | -16,770 |
Net cash used in investing activities | -44,541 | -46,001 | -59,097 |
Cash flows from financing activities: | ' | ' | ' |
Payments of indebtedness and capital lease obligations | -1,308 | -693 | -514 |
Proceeds from revolving line of credit | 235,270 | 78,444 | 0 |
Payments on revolving line of credit | -242,247 | -71,547 | 0 |
Excess tax benefit (charges) from stock-based compensation | 23 | -30 | -27 |
Proceeds from exercise of stock options and employee stock purchase plan | 1,368 | 1,109 | 451 |
Repurchase of shares | 0 | -9,176 | -28,482 |
Cash dividends paid | -8,830 | -15,857 | -7,713 |
Net cash used in financing activities | -15,724 | -17,750 | -36,285 |
Decrease in cash and cash equivalents | -1,404 | -19,001 | -22,052 |
Cash and cash equivalents: | ' | ' | ' |
Beginning of year | 8,129 | 27,130 | 49,182 |
End of year | 6,725 | 8,129 | 27,130 |
Supplemental disclosures of cash flow information: | ' | ' | ' |
Interest paid | 487 | 549 | 397 |
Income taxes paid | 19,831 | 15,447 | 13,126 |
Non-cash investing and financial activities: | ' | ' | ' |
Assets acquired through term loan | 0 | 0 | 3,497 |
Restricted stock issued for the aquistion of intangible assets | $0 | $0 | $135 |
DESCRIPTION_OF_BUSINESS_AND_SU
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | |||
Feb. 01, 2014 | ||||
Accounting Policies [Abstract] | ' | |||
Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block] | ' | |||
NOTE 1 — DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||
Description of business. The primary business of Fred's, Inc. and its subsidiaries ("Fred's", “We”, “Our”, “Us” or “Company”) is the sale of general merchandise through its retail discount stores and full service pharmacies. In addition, the Company sells general merchandise to its 21 franchisees. As of February 1, 2014, the Company had 704 retail stores, 355 pharmacies, and 1 specialty pharmacy facility located in 15 states mainly in the Southeastern United States. | ||||
Consolidated Financial Statements. The Consolidated Financial Statements include the accounts of Fred's, Inc. and its subsidiaries. All significant intercompany accounts and transactions are eliminated. Amounts are in thousands unless otherwise noted. | ||||
Subsequent Events. The Company has evaluated events subsequent to the balance sheet date. Based on this evaluation, we are not aware of any events or transactions requiring recognition or disclosure in our consolidated financial statements. | ||||
Fiscal year. The Company utilizes a 52 - 53 week accounting period which ends on the Saturday closest to January 31. Fiscal years 2013, 2012 and 2011, as used herein, refer to the years ended February 1, 2014, February 2, 2013 and January 28, 2012, respectively. Fiscal year 2012 had 53 weeks, and fiscal years 2013 and 2011 each had 52 weeks. | ||||
Use of estimates. The preparation of financial statements in accordance with U.S. Generally Accepted Accounting Principles ("U.S. GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates and such differences could be material to the financial statements. | ||||
Cash and cash equivalents. Cash on hand and in banks, together with other highly liquid investments which are subject to market fluctuations and having original maturities of three months or less, are classified as cash and cash equivalents. | ||||
Allowance for doubtful accounts. The Company is reimbursed for drugs sold by its pharmacies by many different payors including insurance companies, Medicare and various state Medicaid programs. The Company estimates the allowance for doubtful accounts based on the aging of receivables and additionally uses payor-specific information to assess collection risk, given its interpretation of the contract terms or applicable regulations. However, the reimbursement rates are often subject to interpretations that could result in payments that differ from the Company’s estimates. Additionally, updated regulations and contract negotiations occur frequently, necessitating the Company’s continual review and assessment of the estimation process. Senior management reviews accounts receivable on a quarterly basis to determine if any receivables are potentially uncollectible. The Company includes any accounts receivable balances that are determined to be uncollectible in its overall allowance for doubtful accounts. After all attempts to collect a receivable have failed, the receivable is written off against the allowance account. | ||||
Inventories. Merchandise inventories are stated at the lower of cost or market using the retail first-in, first-out method for goods in our stores and the cost first-in, first-out method for goods in our distribution centers. The retail inventory method is a reverse mark-up, averaging method which has been widely used in the retail industry for many years. This method calculates a cost-to-retail ratio that is applied to the retail value of inventory to determine the cost value of inventory and the resulting cost of goods sold and gross margin. The assumption that the retail inventory method provides for valuation at lower of cost or market and the inherent uncertainties therein are discussed in the following paragraphs. | ||||
In order to assure valuation at the lower of cost or market, the retail value of our inventory is adjusted on a consistent basis to reflect current market conditions. These adjustments include increases to the retail value of inventory for initial markups to set the selling price of goods or additional markups to adjust pricing for inflation and decreases to the retail value of inventory for markdowns associated with promotional, seasonal or other declines in the market value. Because these adjustments are made on a consistent basis and are based on current prevailing market conditions, they approximate the carrying value of the inventory at net realizable value. Therefore, after applying the cost to retail ratio, the cost value of our inventory is stated at the lower of cost or market as is prescribed by U.S. GAAP. In the fourth quarter of 2014, the Company recorded an inventory markdown reserve totaling $1.7 million or $0.03 per diluted share related to general merchandise categories (footwear, select indoor furniture and electronics, primarily televisions) the Company has chosen to exit. | ||||
Because the approximation of net realizable value under the retail inventory method is based on estimates such as markups, markdowns and inventory losses (shrink), there exists an inherent uncertainty in the final determination of inventory cost and gross margin. In order to mitigate that uncertainty, the Company has a formal review by product class which considers such variables as current market trends, seasonality, weather patterns and age of merchandise to ensure that markdowns are taken currently, or a markdown reserve is established to cover future anticipated markdowns. This review also considers current pricing trends and inflation to ensure that markups are taken if necessary. The estimation of inventory losses is a significant element in approximating the carrying value of inventory at net realizable value, and as such the following paragraph describes our estimation method as well as the steps we take to mitigate the risk that this estimate has in the determination of the cost value of inventory. | ||||
The Company calculates inventory losses based on actual inventory losses occurring as a result of physical inventory counts during each fiscal period and estimated inventory losses occurring between yearly physical inventory counts. The estimate for shrink occurring in the interim period between physical counts is calculated on a store-specific basis and is based on history, as well as performance on the most recent physical count. It is calculated by multiplying each store’s shrink rate, which is based on the previously mentioned factors, by the interim period’s sales for each store. Additionally, the overall estimate for shrink is adjusted at the corporate level to a three-year historical average to ensure that the overall shrink estimate is the most accurate approximation of shrink based on the Company’s overall history of shrink. The three-year historical estimate is calculated by dividing the “book to physical” inventory adjustments for the trailing 36 months by the related sales for the same period. In order to reduce the uncertainty inherent in the shrink calculation, the Company first performs the calculation at the lowest practical level (by store) using the most current performance indicators. This ensures a more reliable number, as opposed to using a higher level aggregation or percentage method. The second portion of the calculation ensures that the extreme negative or positive performance of any particular store or group of stores does not skew the overall estimation of shrink. This portion of the calculation removes additional uncertainty by eliminating short-term peaks and valleys that could otherwise cause the underlying carrying value of inventory to fluctuate unnecessarily. The methodology that we have applied in estimating shrink has resulted in variability in result that is not material to our financial statements. The Company has experienced improvement in reducing shrink as a percentage of sales from year to year due to improved inventory control measures, which includes the chain-wide utilization of the NEX/DEX technology. | ||||
Management believes that the Company’s retail inventory method provides an inventory valuation which reasonably approximates cost and results in valuing inventory at the lower of cost or market. For pharmacy department inventories, which were approximately $40.4 million, and $33.8 million at February 1, 2014 and February 2, 2013, respectively, cost was determined using the retail LIFO ("last-in, first-out") method in which inventory cost is maintained using the retail inventory method, then adjusted by application of the highly inflationary Producer Price Index published by the U.S. Department of Labor for the cumulative annual periods. The current cost of inventories exceeded the LIFO cost by approximately $35.2 million at February 1, 2014 and $30.7 million at February 2, 2013. The LIFO reserve increased by approximately $4.5 million and $3.9 million during 2013 and 2012, respectively. | ||||
The Company has historically included an estimate of inbound freight and certain general and administrative costs in merchandise inventory as prescribed by U.S. GAAP. These costs include activities surrounding the procurement and storage of merchandise inventory such as merchandise planning and buying, warehousing, accounting, information technology and human resources, as well as inbound freight. The total amount of procurement and storage costs and inbound freight included in merchandise inventory at February 1, 2014 is $21.6 million compared to $21.6 million at February 2, 2013. | ||||
The Company did not record any below-cost inventory adjustments during the years ended February 1, 2014, February 2, 2013 and January 28, 2012 in connection with planned store closures (see Note 12 - Exit and Disposal Activity). | ||||
Property and equipment. Property and equipment are carried at cost. Depreciation is recorded using the straight-line method over the estimated useful lives of the assets and presented in selling, general and administrative expenses. Improvements to leased premises are amortized using the straight-line method over the shorter of the initial term of the lease or the useful life of the improvement. Leasehold improvements added late in the lease term are amortized over the lesser of the remaining term of the lease (including the upcoming renewal option, if the renewal is reasonably assured) or the estimated useful life of the improvement. Gains or losses on the sale of assets are recorded at disposal. The following average estimated useful lives are generally applied: | ||||
Estimated Useful Lives | ||||
Building and building improvements | 8 - 31.5 years | |||
Furniture, fixtures and equipment | 3 - 10 years | |||
Leasehold improvements | 3 - 10 years or term of lease, if shorter | |||
Automobiles and vehicles | 3 - 10 years | |||
Airplane | 9 years | |||
Assets under capital lease are amortized in accordance with the Company’s normal depreciation policy for owned assets or over the lease term (regardless of renewal options), if shorter, and the charge to earnings is included in depreciation expense in the Consolidated Financial Statements. Amortization expense on assets under capital lease for 2013 was $34 thousand. | ||||
Leases. Certain operating leases include rent increases during the initial lease term. For these leases, the Company recognizes the related rental expense on a straight-line basis over the term of the lease (which includes the pre-opening period of construction, renovation, fixturing and merchandise placement) and records the difference between the amounts charged to operations and amounts paid as a rent liability. Rent expense is recognized on a straight-line basis over the lease term, which includes any rent holiday period. | ||||
The Company recognizes contingent rental expense when the achievement of specified sales targets are considered probable in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 840 “Leases”. The amount expensed but not paid was $0.8 million and $0.7 million at February 1, 2014 and February 2, 2013, respectively, and is included in “Accrued expenses and other” in the consolidated balance sheet (See Note 2 - Detail of Certain Balance Sheet Accounts). | ||||
The Company occasionally receives reimbursements from landlords to be used towards construction of the store the Company intends to lease. The reimbursement is primarily for the purpose of performing work required to divide a much larger location into smaller segments, one of which the Company will use for its store. This work could include the addition or demolition of walls, separation of plumbing, utilities, electrical work, entrances (front and back) and other work as required. Leasehold improvements are recorded at their gross costs including items reimbursed by landlords. The reimbursements are initially recorded as a deferred credit and then amortized as a reduction of rent expense over the initial lease term. | ||||
Based upon an overall analysis of store performance and expected trends, we periodically evaluate the need to close underperforming stores. When we determine that an underperforming store should be closed and a lease obligation still exists, we record the estimated future liability associated with the rental obligation on the date the store is closed in accordance with FASB ASC 420, “Exit or Disposal Cost Obligations.” Liabilities are computed based at the point of closure for the present value of any remaining operating lease obligations, net of estimated sublease income, and at the communication date for severance and other exit costs, as prescribed by FASB ASC 420. The assumptions in calculating the liability include the timeframe expected to terminate the lease agreement, estimates related to the sublease of potential closed locations, and estimation of other related exit costs. If the actual timing and the potential termination costs or realization of sublease income differ from our estimates, the resulting liabilities could vary from recorded amounts. We periodically review the liability for closed stores and make adjustments when necessary. | ||||
Impairment of long-lived assets. The Company’s policy is to review the carrying value of all property and equipment as well as purchased intangible assets subject to amortization for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. In accordance with FASB ASC 360, “Impairment or Disposal of Long-Lived Assets,” we review for impairment all stores open at least 3 years or remodeled for more than two years. Impairment results when the carrying value of the assets exceeds the undiscounted future cash flows over the life of the lease, or 10 years for owned stores. Our estimate of undiscounted future cash flows over the lease term is based upon historical operations of the stores and estimates of future store profitability which encompasses many factors that are subject to management’s judgment and are difficult to predict. If a long-lived asset is found to be impaired, the amount recognized for impairment is equal to the difference between the carrying value and the asset’s fair value. The fair value is based on estimated market values for similar assets or other reasonable estimates of fair market value based upon using a discounted cash flow model. | ||||
No impairments were recognized in 2013, 2012 or 2011. | ||||
Revenue recognition. The Company markets goods and services through 683 company-owned stores and 21 franchised stores as of February 1, 2014. Net sales includes sales of merchandise from company-owned stores, net of returns and exclusive of sales taxes. Sales to franchised stores are recorded when the merchandise is shipped from the Company’s warehouse. Revenues resulting from layaway sales are recorded upon delivery of the merchandise to the customer. | ||||
The Company also sells gift cards for which the revenue is recognized at time of redemption. The Company records a gift card liability on the date the gift card is issued to the customer. Revenue is recognized and the gift card liability is reduced as the customer redeems the gift card. The Company will recognize aged liabilities as revenue when the likelihood of the gift card being redeemed is remote. The Company has not recognized any revenue from gift card breakage since the inception of the program in May 2004 and does not expect to record any gift card breakage revenue until there is more certainty regarding our ability to retain such amounts in light of current consumer protection and state escheatment laws. | ||||
In addition, the Company charges the franchised stores a fee based on a percentage of their purchases from the Company. These fees represent a reimbursement for use of the Fred's name and other administrative costs incurred on behalf of the franchised stores and are therefore netted against selling, general and administrative expenses. Total franchise income for 2013, 2012 and 2011 was $1.6 million, $1.7 million and $1.8 million, respectively. | ||||
Cost of goods sold. Cost of goods sold includes the purchase cost of inventory and the freight costs to the Company’s distribution centers. Warehouse and occupancy costs, including depreciation and amortization, are not included in cost of goods sold, but are included as a component of selling, general and administrative expenses. | ||||
Vendor rebates and allowances. The Company receives rebates for a variety of merchandising activities, such as volume commitment rebates, relief for temporary and permanent price reductions, cooperative advertising programs, and for the introduction of new products in our stores. FASB ASC 605-50 “Customer Payments and Incentives” addresses the accounting and income statement classification for consideration given by a vendor to a retailer in connection with the sale of the vendor’s products or for the promotion of sales of the vendor’s products. Such consideration received from vendors is reflected as a decrease in prices paid for inventory and recognized in cost of sales as the related inventory is sold, unless specific criteria are met qualifying the consideration for treatment as reimbursement of specific, identifiable incremental costs. | ||||
Selling, general and administrative expenses. The Company includes buying, warehousing, distribution, advertising, depreciation and amortization and occupancy costs in selling, general and administrative expenses. | ||||
Advertising. In accordance with FASB ASC 720-35 “Advertising Costs”, the Company charges advertising, including production costs, to selling, general and administrative expense on the first day of the advertising period. Gross advertising expenses for 2013, 2012 and 2011, were $22.8 million, $24.0 million and $21.9 million, respectively. Gross advertising expenses were reduced by vendor cooperative advertising allowances of $2.8 million, $2.4 million and $2.4 million, for 2013, 2012 and 2011, respectively. It would be the Company’s intention to incur a similar amount of advertising expense as in prior years and in support of our stores even if we did not receive support from our vendors in the form of cooperative advertising programs. | ||||
Preopening costs. The Company charges to expense the preopening costs of new stores as incurred. These costs are primarily labor to stock the store, rent, preopening advertising, store supplies and other expendable items. | ||||
Intangible assets. Other identifiable intangible assets primarily represent customer lists associated with acquired pharmacies and are being amortized on a straight-line basis over seven years. After testing the retention rate of customers obtained in acquisitions over the last eight years, the Company changed the estimated life of customer lists associated with acquired pharmacies from five to seven years in the fourth quarter of 2013. Based on the Company's historical experience, seven years is a closer approximation of the actual lives of these assets. The change in estimate is applied prospectively. Expenses for the fourth quarter of 2013 were favorably impacted by approximately $1.5 million ($.03 per diluted share) as a result of this change. The Company expects this change in estimate to have a positive effect on earnings across all four quarters of 2014. Intangibles, net of accumulated amortization, totaled $54.6 million at February 1, 2014, and $41.9 million at February 2, 2013. Accumulated amortization at February 1, 2014 and February 2, 2013 totaled $54.3 million and $42.2 million, respectively. Amortization expense for 2013, 2012 and 2011, was $12.1 million, $10.5 million and $6.9 million, respectively. Estimated amortization expense for the assets recognized as of February 1, 2014, in millions for each of the next 7 years is as follows: 2014 - $9.8 million, 2015 - $9.7 million, 2016 - $9.5 million, 2017 - $8.7 million, 2018 - $7.5 million, 2019 - $5.1 million and 2020 - $2.8 million. | ||||
Fair value of financial instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy, as defined below, gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. | ||||
⋅ | Level 1, defined as quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date. | |||
⋅ | Level 2, defined as Inputs other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly. | |||
⋅ | Level 3, defined as unobservable inputs for the asset or liability. | |||
At February 1, 2014, the Company did not have any outstanding derivative instruments. The recorded value of the Company’s financial instruments, which include cash and cash equivalents, receivables, accounts payable and indebtedness, approximates fair value. The following methods and assumptions were used to estimate fair value of each class of financial instrument: (1) the carrying amounts of current assets and liabilities approximate fair value because of the short maturity of those instruments and (2) the fair value of the Company’s indebtedness is estimated based on the current borrowing rates available to the Company for bank loans with similar terms and average maturities. Most of our indebtedness is under variable interest rates. | ||||
Insurance reserves. The Company is largely self-insured for workers compensation, general liability and employee medical insurance. The Company’s liability for self-insurance is determined based on claims known at the time of determination of the reserve and estimates for future payments against incurred losses and claims that have been incurred but not reported. Estimates for future claims costs include uncertainty because of the variability of the factors involved, such as the type of injury or claim, required services by the providers, healing time, age of claimant, case management costs, location of the claimant, and governmental regulations. These uncertainties or a deviation in future claims trends from recent historical patterns could result in the Company recording additional expenses or expense reductions that might be material to the Company’s results of operations. The Company’s worker's compensation and general liability insurance policy coverages run August 1 through July 31 of each fiscal year. Our employee medical insurance policy coverage runs from January 1 through December 31. The Company purchases excess insurance coverage for certain of its self-insured liabilities, or stop loss coverage. The stop loss limits for excessive or catastrophic claims for general liability remained at $350,000, worker’s compensation remained at $500,000 and employee medical remained at $175,000. The Company’s insurance reserve was $10.5 million and $10.1 million on February 1, 2014 and February 2, 2013, respectively. Changes in the reserve for the year ended February 1, 2014, over that time period were attributable to additional reserve requirements of $41.9 million netted with payments of $41.5 million. | ||||
Stock-based compensation. The Company uses the fair value recognition provisions of FASB ASC 718, “Compensation – Stock Compensation”, whereby the Company recognizes share-based payments to employees and directors in the Consolidated Statements of Income on a straight-line basis over the requisite service period based on the fair value of the award. | ||||
Effective January 29, 2006, the Company elected to adopt the alternative transition method provided in FASB ASC 718 for calculating the income tax effects of stock-based compensation. The alternative transition method includes simplified methods to establish the beginning balance of the additional paid-in-capital pool (“APIC Pool”) related to the income tax effects of stock based compensation, and for determining the subsequent impact on the APIC pool and consolidated statements of cash flows of the income tax effects of stock-based compensation awards that are outstanding upon adoption of FASB ASC 718. | ||||
FASB ASC 718 also requires the benefits of income tax deductions in excess of recognized compensation cost to be reported as a financing cash flow, rather than as an operating cash flow. The impact of adopting FASB ASC 718 on future results will depend on, among other things, levels of share-based payments granted in the future, actual forfeiture rates and the timing of option exercises. | ||||
Stock-based compensation expense, post adoption of FASB ASC 718, is based on awards ultimately expected to vest, and therefore has been reduced for estimated forfeitures. Forfeitures are estimated at the time of grant based on the Company’s historical forfeiture experience and will be revised in subsequent periods if actual forfeitures differ from those estimates. | ||||
Income taxes. The Company reports income taxes in accordance with FASB ASC 740, “Income Taxes.” Under FASB ASC 740, the asset and liability method is used for computing future income tax consequences of events, which have been recognized in the Company’s Consolidated Financial Statements or income tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred income tax expense or benefit is the net change during the year in the Company’s deferred income tax assets and liabilities (see Note 5 – Income Taxes). | ||||
The Company also applies the guidance of FASB ASC 740-10-25, Income Taxes, Uncertain Tax Positions, which clarifies the accounting for uncertainties in income taxes recognized in the Company’s financial statements in accordance with FASB ASC 740 by defining the criterion that an individual tax position must meet in order to be recognized in the financial statements. FASB ASC 740 requires that the tax effects of a position be recognized only if it is “more-likely-than-not” to be sustained based solely on the technical merits as of the reporting date (see Note 5 – Income Taxes). | ||||
Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. Significant judgment is required in evaluating the need for and magnitude of appropriate valuation allowances against deferred tax assets. The realization of these assets is dependent on generating future taxable income, as well as successful implementation of various tax planning strategies. | ||||
While Fred’s believes that these judgments and estimates are appropriate and reasonable under the circumstances, actual resolution of these matters may differ from recorded estimated amounts. | ||||
Business segments. The Company manages the business on the basis of one operating segment and therefore, has only one reportable segment. All operations are located in the United States. | ||||
Comprehensive income. Comprehensive income consists of two components, net income and other comprehensive income (loss). Other comprehensive income (loss) refers to gains and losses that under generally accepted accounting principles are recorded as an element of shareholders’ equity but are excluded from net income. The Company’s accumulated other comprehensive income includes the effect of adopting SFAS No. 158, Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No. 87, 88, 106, and 132(R)(“SFAS No. 158”) codified in FASB ASC 715 “Compensation – Retirement Benefits”. See Note 10, Commitments and Contingencies, in the Notes to Consolidated Financial Statements for further discussion. | ||||
Reclassifications. Certain prior year amounts have been reclassified to conform to the 2013 presentation. | ||||
Recent Accounting Pronouncements. In June 2011, the Financial Accounting Standards Board issued ASU 2011-05, Comprehensive Income (Topic 22): Presentation of Comprehensive Income, which revised the current practice of including other comprehensive income within the equity section of the statement of financial position and requires disclosure of other comprehensive income either in a single continuous statement of comprehensive income or in a separate statement. This guidance became effective in fiscal 2012. The adoption of ASU 2011-05 did not have an impact on the Company’s consolidated net earnings, cash flows or financial position, but the adoption did change the presentation of other comprehensive income in the Company’s consolidated financial statements. In February 2013, an update was issued regarding ASU 2011-05, which requires an entity to present, either on the face of the income statement or as a separate disclosure in the notes to the consolidated financial statements, the effects on net income of significant amounts reclassified out of each component of accumulated other comprehensive income if those amounts all are required under other Topics to be reclassified to net income in their entirety in the same reporting period. The update of ASU 2011-05 did not have an impact on the Company’s consolidated net earnings, cash flows or financial position. | ||||
In July 2013, the Financial Accounting Standards Board issued ASU 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Task Force). This guidance will be effective in the first quarter of 2014. The amendments in this ASU state that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. We do not expect this guidance will require a change in the current presentation of unrecognized tax benefits. | ||||
DETAIL_OF_CERTAIN_BALANCE_SHEE
DETAIL OF CERTAIN BALANCE SHEET ACCOUNTS | 12 Months Ended | |||||||
Feb. 01, 2014 | ||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||||
Supplemental Balance Sheet Disclosures [Text Block] | ' | |||||||
NOTE 2 – DETAIL OF CERTAIN BALANCE SHEET ACCOUNTS | ||||||||
Details of certain balance sheet accounts as of February 1, 2014 and February 2, 2013 are as follows: | ||||||||
(in thousands) | ||||||||
Property and equipment, at cost: | 2013 | 2012 | ||||||
Buildings and building improvements | $ | 114,688 | $ | 113,164 | ||||
Leasehold improvements | 78,101 | 74,552 | ||||||
Automobiles and vehicles | 5,459 | 5,601 | ||||||
Airplane | 4,697 | 4,697 | ||||||
Furniture, fixtures and equipment | 268,771 | 265,916 | ||||||
471,716 | 463,930 | |||||||
Less: Accumulated depreciation and amortization | -328,686 | -315,175 | ||||||
143,030 | 148,755 | |||||||
Construction in progress | 1,729 | 1,035 | ||||||
Land | 8,604 | 8,604 | ||||||
Total Property and equipment, at depreciated cost | $ | 153,363 | $ | 158,394 | ||||
Depreciation expense totaled $28.9 million, $29.0 million and $27.3 million for 2013, 2012 and 2011, respectively. | ||||||||
(in thousands) | ||||||||
Other non-trade receivables: | 2013 | 2012 | ||||||
Vendor receivables | $ | 30,431 | $ | 26,728 | ||||
Income tax receivable | 3,159 | 2,217 | ||||||
Franchise stores receivable | 1,537 | 1,157 | ||||||
Insurance claims receivable | - | 474 | ||||||
Coupon receivable | 400 | 457 | ||||||
Other | 1,963 | 2,240 | ||||||
Total other non-trade receivable | $ | 37,490 | $ | 33,273 | ||||
Prepaid expenses and other current assets: | 2013 | 2012 | ||||||
Prepaid rent | $ | 4,505 | $ | 4,496 | ||||
Supplies | 4,473 | 4,479 | ||||||
Prepaid insurance | 1,644 | 1,546 | ||||||
Prepaid advertising | 806 | 693 | ||||||
Other | 1,817 | 1,920 | ||||||
Total prepaid expenses and other current assets | $ | 13,245 | $ | 13,134 | ||||
Accrued expenses and other: | 2013 | 2012 | ||||||
Insurance reserves | $ | 10,474 | $ | 10,094 | ||||
Payroll and benefits | 9,661 | 9,289 | ||||||
Sales and use tax | 4,586 | 6,647 | ||||||
Deferred / contingent rent | 2,904 | 3,086 | ||||||
Real estate tax | 1,858 | 1,777 | ||||||
Giftcard liability | 1,473 | 1,325 | ||||||
Utilities | 1,358 | 821 | ||||||
Warehouse freight and fuel | 1,315 | 1,735 | ||||||
Personal property tax | 1,080 | 959 | ||||||
Franchise stores payable | 1,000 | 625 | ||||||
Repairs and maintenance | 862 | 344 | ||||||
Lease liability | 117 | 210 | ||||||
Other | 7,930 | 7,088 | ||||||
Total accrued expenses and other | $ | 44,618 | $ | 44,000 | ||||
Other noncurrent liabilities: | 2103 | 2012 | ||||||
Deferred income (see Note 1 - Vendor Rebates and Allowances) | $ | 13,084 | $ | 11,469 | ||||
Uncertain tax positions | 1,329 | 2,112 | ||||||
$ | 14,413 | $ | 13,581 | |||||
INDEBTEDNESS
INDEBTEDNESS | 12 Months Ended | ||||||||||||||||||||||
Feb. 01, 2014 | |||||||||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||||||||
Debt Disclosure [Text Block] | ' | ||||||||||||||||||||||
NOTE 3 — INDEBTEDNESS | |||||||||||||||||||||||
On January 25, 2013, the Company entered into a new Revolving Loan and Credit Agreement (the "Agreement") with Regions Bank and Bank of America to replace the April 3, 2000 Revolving Loan and Credit Agreement, which was last amended September 27, 2010. The Agreement provides for a $50 million revolving line of credit, and the term of the Agreement extends to January 25, 2016. Three borrowing options are available in the Agreement, which bear interest at our option, on a sliding scale from 1.00% - 1.625% plus LIBOR, or an alternative base rate. For borrowings under $20 million, advances occur automatically via a sweep account. If borrowings exceed $20 million, notice of the borrowing must be given on the same day as the requested advance or three days prior to the requested advance, depending on the borrowing option chosen. The Agreement also bears a credit facility fee which will be amortized over the Agreement term. The Agreement contains certain restrictive financial covenants, and at February 1, 2014, the Company was in compliance with all loan covenants. | |||||||||||||||||||||||
Borrowings and the unused fees under the Agreement bear interest at a tiered rate based on the Company’s previous four quarter average of the Fixed Charge Coverage Ratio. Currently, the Company’s rates are 137.5 basis points over LIBOR for borrowings and 25.0 basis points over LIBOR for the unused portion of the credit line. There were no borrowings under the Agreement at February 1, 2014 and $6.9 million of borrowings outstanding at February 2, 2013. The weighted average interest rate on borrowings outstanding at February 2, 2013 was 1.33%. | |||||||||||||||||||||||
During the second and third quarter of fiscal 2007, the Company acquired the land and buildings, occupied by 7 Fred's stores which we had previously leased. In consideration for the 7 properties, the Company assumed debt that has fixed interest rates from 6.31% to 7.40%. On March 30, 2011, Fred’s purchased ten properties leased from Atlantic Retail Investors, LLC, one of which has an additional parcel that is leased to an unrelated party, for $7.5 million in cash and assumed mortgage debt of $3.5 million on 6 of these locations (see Note 6 – Long-Term Leases) with fixed interest rates from 6.65% to 7.40%. The debt is collateralized by the land and buildings. The table below shows the long term debt related to these properties due for the next five years as of February 1, 2014: | |||||||||||||||||||||||
(in thousands) | 2014 | 2015 | 2016 | 2017 | 2018 | Thereafter | Total | ||||||||||||||||
Mortgage loans on land & buildings | $ | 1,640 | $ | 1,412 | $ | 623 | $ | 60 | $ | 70 | $ | 1,514 | $ | 5,319 | |||||||||
The Company financed the construction of its Dublin, Georgia distribution center with taxable industrial development revenue bonds issued by the City of Dublin and County of Laurens Development Authority. The Company purchased 100% of the issued bonds and intends to hold them to maturity, effectively financing the construction with internal cash flow. Because a legal right of offset exists, the Company has offset the investment in the bonds ($34.6 million) against the related liability and neither is reflected on the consolidated balance sheet. | |||||||||||||||||||||||
FAIR_VALUE_MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended | |||||||||||||
Feb. 01, 2014 | ||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||
Fair Value Disclosures [Text Block] | ' | |||||||||||||
NOTE 4 — FAIR VALUE MEASUREMENTS | ||||||||||||||
Due to their short-term nature, the Company’s financial instruments, which include cash and cash equivalents, receivables, accounts payable and indebtedness, are a reasonable estimate of their fair value as of February 1, 2014 and February 2, 2013. The fair value of the revolving line of credit is consistent with the carrying amount as repayments are short-term in nature. Although not due until fiscal 2016, all borrowings on the revolving line of credit that existed at the balance sheet date have been subsequently repaid prior to the April 17, 2014 filing date. The fair value of the revolving line of credit and our mortgage loans are estimated using Level 2 inputs based on the Company's current incremental borrowing rate for comparable borrowing arrangements. | ||||||||||||||
The table below details the fair value and carrying values for the revolving line of credit and mortgage loans as of the following years: | ||||||||||||||
February 1, 2014 | February 2, 2013 | |||||||||||||
(dollars in thousands) | Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||
Revolving line of credit | $ | - | $ | - | $ | 6,977 | $ | 6,977 | ||||||
Mortgage loans on land & buildings | 5,319 | 5,581 | 6,628 | 6,987 | ||||||||||
INCOME_TAXES
INCOME TAXES | 12 Months Ended | ||||||||||||
Feb. 01, 2014 | |||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||
Income Tax Disclosure [Text Block] | ' | ||||||||||||
NOTE 5 — INCOME TAXES | |||||||||||||
The provision for income taxes consists of the following for the years ended February 1, 2014, February 2, 2013 and January 28, 2012: | |||||||||||||
(dollars in thousands) | 2013 | 2012 | 2011 | ||||||||||
Current | |||||||||||||
Federal | $ | 17,079 | $ | 11,298 | $ | 9,953 | |||||||
State | 1,489 | 834 | 915 | ||||||||||
18,568 | 12,132 | 10,868 | |||||||||||
Deferred | |||||||||||||
Federal | -5,060 | -3,865 | 6,886 | ||||||||||
State | -812 | 633 | -424 | ||||||||||
-5,872 | -3,232 | 6,462 | |||||||||||
$ | 12,696 | $ | 8,900 | $ | 17,330 | ||||||||
The income tax effects of temporary differences that give rise to significant portions of the deferred income tax assets and deferred income tax liabilities as of year-end are presented below: | |||||||||||||
(dollars in thousands) | 2013 | 2012 | |||||||||||
Deferred income tax assets: | |||||||||||||
Accrual for incentive compensation | $ | 528 | $ | 241 | |||||||||
Allowance for doubtful accounts | 1,017 | 752 | |||||||||||
Insurance accruals | 2,545 | 2,320 | |||||||||||
Other accruals | 19 | 40 | |||||||||||
Net operating loss carryforwards | 4,498 | 4,803 | |||||||||||
Postretirement benefits other than pensions | - | - | |||||||||||
Deferred revenue | 755 | 657 | |||||||||||
Federal benefit on state reserves | 311 | 584 | |||||||||||
Amortization of intangibles | 13,076 | 10,821 | |||||||||||
Total deferred income tax assets | 22,749 | 20,218 | |||||||||||
Less: Valuation allowance | 2,051 | 1,995 | |||||||||||
Deferred income tax assets, net of valuation allowance | 20,698 | 18,223 | |||||||||||
Deferred income tax liabilities: | |||||||||||||
Postretirement benefits | -144 | -287 | |||||||||||
Property, plant and equipment | -15,767 | -18,996 | |||||||||||
Inventory valuation | -28,542 | -27,906 | |||||||||||
Prepaid expenses | -170 | - | |||||||||||
Total deferred income tax liabilities | -44,623 | -47,189 | |||||||||||
Net deferred income tax liabilities | $ | -23,925 | $ | -28,966 | |||||||||
The net operating loss carryforwards are available to reduce state income taxes in future years. These carry-forwards total approximately $102.5 million for state income tax purposes and expire at various times during the fiscal years 2014 through 2034. | |||||||||||||
We maintain a valuation allowance for state net operating losses that we do not expect to utilize prior to their expiration. During 2013, the valuation allowance increased $0.1 million, and during 2012, the valuation allowance increased $0.4 million. Based upon expected future income, management believes that it is more likely than not that the results of operations will generate sufficient taxable income to realize the deferred income tax asset after giving consideration to the valuation allowance. | |||||||||||||
A reconciliation of the statutory federal income tax rate to the effective income tax rate is as follows: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Income tax provision at statutory rate | 35 | % | 35 | % | 35 | % | |||||||
Tax credits, principally jobs | -2.9 | -1 | -2.3 | ||||||||||
State income taxes, net of federal benefit | 2.2 | 4.7 | -0.2 | ||||||||||
Permanent differences | 0.4 | 0.3 | 0.5 | ||||||||||
Uncertain tax provisions | -1.3 | -12.7 | 0.3 | ||||||||||
Change in state valuation allowance | 0.2 | -2.2 | 0.8 | ||||||||||
Other | -0.8 | -1 | - | ||||||||||
Effective income tax rate | 32.8 | % | 23.1 | % | 34.1 | % | |||||||
A reconciliation of the beginning and ending amount of the unrecognized tax benefits is as follows: | |||||||||||||
(in millions) | 2013 | 2012 | 2011 | ||||||||||
Beginning balance | $ | 2.1 | $ | 9.6 | $ | 9.3 | |||||||
Additions for tax position during the current year | 0.2 | 0.1 | 1.1 | ||||||||||
Additions for tax positions of prior years | 0.1 | 0.1 | 0.3 | ||||||||||
Reductions for tax positions of prior years from lapse of statue | -1.1 | -0.9 | -1.1 | ||||||||||
Reductions for settlements of prior year tax positions | - | -6.8 | - | ||||||||||
Ending balance | $ | 1.3 | $ | 2.1 | $ | 9.6 | |||||||
As of February 2, 2013, our liability for unrecognized tax benefits totaled $2.1 million, of which $1.1 million was recognized as income tax benefit during the periods in the 3rd and 4th quarter of 2013. We had additions of $0.3 million during fiscal 2013, $0.2 million of which resulted from state tax positions during the current year. As of February 1, 2014, our liability for unrecognized tax benefits totaled $1.3 million and is recorded in our Consolidated Balance Sheet within “Other noncurrent liabilities,” all of which, if recognized, would affect our effective tax rate. Examinations by the state jurisdictions are expected to be completed within the next 12 months which could result in a change to our unrecognized tax benefits. | |||||||||||||
FASB ASC 740 further requires that interest and penalties required to be paid by the tax law on the underpayment of taxes should be accrued on the difference between the amount claimed or expected to be claimed on the tax return and the tax benefit recognized in the financial statements. The Company includes potential interest and penalties recognized in accordance with FASB ASC 740 in the financial statements as a component of income tax expense. As of February 1, 2014, accrued interest and penalties related to our unrecognized tax benefits totaled $0.2 million and $0.1 million, respectively. As of February 2, 2013, accrued interest and penalties related to our unrecognized tax benefits totaled $0.4 million and $0.1 million, respectively. Both accrued interest and penalties are recorded in the Consolidated Balance Sheet within “Other noncurrent liabilities.” | |||||||||||||
The Company files numerous consolidated and separate company income tax returns in the U.S. federal jurisdiction and in many U.S. state jurisdictions. With few exceptions, we are subject to U.S. federal, state, and local income tax examinations by tax authorities for years 2010-2012. However, tax authorities have the ability to review years prior to these to the extent we utilized tax attributes carried forward from those prior years. | |||||||||||||
LONGTERM_LEASES
LONG-TERM LEASES | 12 Months Ended | ||||
Feb. 01, 2014 | |||||
Leases [Abstract] | ' | ||||
Leases of Lessor Disclosure [Text Block] | ' | ||||
NOTE 6 — LONG-TERM LEASES | |||||
The Company leases certain of its store locations under noncancelable operating leases that require monthly rental payments primarily at fixed rates (although a number of the leases provide for additional rent based upon sales) expiring at various dates through fiscal 2029. None of our operating leases contain residual value guarantees. Many of these leases contain renewal options and require the Company to pay taxes, maintenance, insurance and certain other operating expenses applicable to the leased properties. In addition, the Company leases various equipment under noncancelable operating leases. Total rent expense under operating leases was $60.0 million, $57.2 million and $53.2 million, for 2013, 2012 and 2011, respectively. Total contingent rentals included in operating leases above was $0.8 million for 2013, $0.7 million for 2012 and $1.0 million for 2011. Future minimum rental payments under all operating leases as of February 1, 2014 are as follows: | |||||
(in thousands) | Operating Leases | ||||
2014 | $ | 46,423 | |||
2015 | 39,293 | ||||
2016 | 32,782 | ||||
2017 | 25,354 | ||||
2018 | 15,962 | ||||
Thereafter | 50,060 | ||||
Total minimum lease payments | $ | 209,874 | |||
The gross amount of property and equipment under capital leases was $5.1 million at both February 1, 2014 and February 2, 2013. Accumulated amortization on property and equipment under capital leases was $5.1 million at both February 1, 2014 and February 2,2013. We did not incur any amortization expense on assets under capital lease for 2010 as the assets were fully amortized. Amortization expense on assets under capital lease for both 2013 and 2012 was $34 thousand. | |||||
Related Party Transactions | |||||
Atlantic Retail Investors, LLC, which is partially owned by Michael J. Hayes, a director of the Company, owned the land and buildings occupied by thirteen Fred’s stores, until 2011, when ten of these properties were purchased by the Company. The terms and conditions regarding the leases on these locations were consistent in all material respects with other stores leases of the Company with unrelated landlords. | |||||
Fred’s Inc. is leasing three properties from Atlantic Retail Investors, LLC, and the total rental payments for related party leases were $301.0 thousand for the year ended February 1, 2014 and $326.1 thousand and $451.2 thousand for the years ended February 2, 2013 and January 28, 2012, respectively. | |||||
SHAREHOLDERS_EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Feb. 01, 2014 | |
Stockholders' Equity Note [Abstract] | ' |
Stockholders Equity Note Disclosure [Text Block] | ' |
NOTE 7 — SHAREHOLDERS’ EQUITY | |
In 1998, the Company adopted a Shareholders Rights Plan which granted a dividend of one preferred share purchase right (a “Right”) for each common share outstanding at that date. Each Right represents the right to purchase one-hundredth of a preferred share of stock at a preset price to be exercised when any one individual, firm, corporation or other entity acquires 15% or more of the Company’s common stock. The Rights become dilutive at the time of exercise. At the annual shareholders meeting in 2012, the shareholders voted not to continue the Shareholders Rights Plan. As a result of that vote, the Shareholders Rights Plan terminated December 31, 2013. | |
Purchases of Equity Securities by the Issuer and Affiliated Purchasers. On August 27, 2007, the Board of Directors approved a plan that authorized stock repurchases of up to 4.0 million shares of the Company’s common stock, of which 90.0 thousand shares remained at January 28, 2012. On February 16, 2012, Fred's Board authorized the expansion of the Company's existing stock re-purchase program by increasing the authorization to repurchase an additional 3.6 million shares. Under the plan, the Company may repurchase its common stock in open market or privately negotiated transactions at such times and at such prices as determined to be in the Company’s best interest. These purchases may be commenced or suspended without prior notice depending on then-existing business or market conditions and other factors. As of February 2, 2013, there were 3.0 million shares available for repurchase under the plan. No repurchases were made in fiscal year 2013, leaving 3.0 million shares available for repurchase at February 1, 2014. | |
EQUITY_INCENTIVE_PLANS
EQUITY INCENTIVE PLANS | 12 Months Ended | |||||||||||||
Feb. 01, 2014 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | ' | |||||||||||||
NOTE 8 – EQUITY INCENTIVE PLANS | ||||||||||||||
Incentive stock option plan. The Company has a long-term incentive plan, which was reapproved by Fred's stockholders at the 2012 annual shareholders meeting. The 2012 plan is substantially identical to the prior plan. The 2012 plan increases the number of shares of the Company’s common stock authorized for issuance by 600,000 shares, from the 2,400,000 which was available under the prior plan to 3,000,000 shares. The plan expires March 18, 2022, and Section 10 of the 2002 plan, which provides for supplemental cash payments or loans to individuals in connection with all or any part of an award under the plan, has been removed and is not part of the 2012 plan. Shares available to be granted under the long-term incentive plan were 1,273,395 as of February 1, 2014 (1,343,795 shares as of February 2, 2013). Options issued under the 2002 and 2012 plans expire five to eight years from the date of grant. Options outstanding at February 1, 2014 expire in fiscal 2014 through fiscal 2021. | ||||||||||||||
The Company grants stock options to key employees including executive officers, as well as other employees, as prescribed by the Compensation Committee (the “Committee”) of the Board of Directors. The number of options granted is directly linked to the employee’s job classification. Options, which include non-qualified stock options and incentive stock options, are rights to purchase a specified number of shares of Fred's common stock at a price fixed by the Committee. Stock options granted have an exercise price equal to the market price of Fred's common stock on the date of grant. The exercise price for stock options issued under the plan that qualify as incentive stock options within the meaning of Section 422(b) of the Code shall not be less than 100% of the fair value as of the date of grant. The option exercise price may be satisfied in cash or by exchanging shares of Fred's common stock owned by the optionee for at least six months, or a combination of cash and shares. Options have a maximum term of five to eight years from the date of grant. Options granted under the plan generally become exercisable ratably over five years or ten percent during each of the first four years on the anniversary date and sixty percent on the fifth anniversary date. The rest vest ratably over the requisite service period. Stock option expense is generally recognized using the graded vesting attribution method. The plan contains a non-compete provision and a provision that if the Company meets or exceeds a specified operating income margin during the most recently completed fiscal year that the annual vesting percentage will accelerate from ten to twenty percent during that vesting period. The plan also provides for annual stock grants at the market price of the common stock on the grant date to non-employee directors according to a non-discretionary formula. The number of shares granted is dependent upon current director compensation levels. | ||||||||||||||
Employee Stock Purchase Plan. The 2004 Employee Stock Purchase Plan ("ESSP") (the “2004 Plan”), which was approved by Fred's stockholders, permits eligible employees to purchase shares of our common stock through payroll deductions at the lower of 85% of the fair market value of the stock at the time of grant or 85% of the market price at the time of exercise. There were 60,912, 54,830 and 52,526 shares issued during fiscal years 2013, 2012 and 2011, respectively. There are 1,410,928 shares approved to be issued under the 2004 Plan and as of February 1, 2014 there were 858,565 shares available. | ||||||||||||||
The following represents total stock based compensation expense (a component of selling, general and administrative expenses) recognized in the consolidated financial statements (in thousands): | ||||||||||||||
(in thousands) | 2013 | 2012 | 2011 | |||||||||||
Stock option expense | $ | 610 | $ | 600 | $ | 455 | ||||||||
Restricted stock expense | 984 | 1,258 | 1,446 | |||||||||||
ESPP expense | 197 | 197 | 174 | |||||||||||
Total stock-based compensation | $ | 1,791 | $ | 2,055 | $ | 2,075 | ||||||||
Income tax benefit on stock-based compensation | $ | 473 | $ | 565 | $ | 573 | ||||||||
The Company uses the Modified Black-Scholes Option Valuation Model (“BSM”) to measure the fair value of stock options granted to employees. The BSM option valuation model was developed for use in estimating the fair value of traded options, which have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions including the expected stock volatility and option life. Because the Company’s employee stock options have characteristics significantly different from those of traded options, and because changes in the subjective assumptions can materially affect the fair value estimate, in management’s opinion, the existing models do not necessarily provide a reliable single measure of the fair value of its employee stock options. | ||||||||||||||
The fair value of each option granted is estimated on the date of grant using the BSM with the following weighted average assumptions: | ||||||||||||||
Stock Options | 2013 | 2012 | 2011 | |||||||||||
Expected volatility | 32.1 | % | 39.7 | % | 41.2 | % | ||||||||
Risk-free interest rate | 1.2 | % | 0.5 | % | 1.8 | % | ||||||||
Expected option life (in years) | 4.73 | 4.16 | 5.13 | |||||||||||
Expected dividend yield | 1.7 | % | 1.3 | % | 0.9 | % | ||||||||
Weighted average fair value at grant date | $ | 3.81 | $ | 3.95 | $ | 4.35 | ||||||||
Employee Stock Purchase Plan | ||||||||||||||
Expected volatility | 22.7 | % | 33.2 | % | 27.6 | % | ||||||||
Risk-free interest rate | 0.2 | % | 0.1 | % | 0.3 | % | ||||||||
Expected option life (in years) | 0.63 | 0.63 | 0.63 | |||||||||||
Expected dividend yield | 1.1 | % | 1 | % | 0.9 | % | ||||||||
Weighted average fair value at grant date | $ | 3.02 | $ | 3.6 | $ | 3.32 | ||||||||
The following is a summary of the methodology applied to develop each assumption: | ||||||||||||||
Expected Volatility — This is a measure of the amount by which a price has fluctuated or is expected to fluctuate. The Company uses actual historical changes in the market value of our stock to calculate expected price volatility because management believes that this is the best indicator of future volatility. The Company calculates weekly market value changes from the date of grant over a past period representative of the expected life of the options to determine volatility. An increase in the expected volatility will increase compensation expense. | ||||||||||||||
Risk-free Interest Rate — This is the yield of a U.S. Treasury zero-coupon bond issue effective at the grant date with a remaining term equal to the expected life of the option. An increase in the risk-free interest rate will increase compensation expense. | ||||||||||||||
Expected Lives — This is the period of time over which the options granted are expected to remain outstanding and is based on historical experience. Options granted have a maximum term of seven and one-half years. An increase in the expected life will increase compensation expense. | ||||||||||||||
Dividend Yield — This is based on the historical yield for a period equivalent to the expected life of the option. An increase in the dividend yield will decrease compensation expense. | ||||||||||||||
Forfeiture Rate — This is the estimated percentage of options granted that are expected to be forfeited or cancelled before becoming fully vested. This estimate is based on historical experience. An increase in the forfeiture rate will decrease compensation expense. | ||||||||||||||
Stock Options. The following table summarizes stock option activity from January 29, 2011 through February 1, 2014: | ||||||||||||||
Options | Weighted- | Weighted- | Aggregate | |||||||||||
Average | Averaged | Intrinsic | ||||||||||||
Exercise Price | Contractual | Value (000s) | ||||||||||||
Life (years) | ||||||||||||||
Outstanding at January 29, 2011 | 918,462 | $ | 12.15 | 3.2 | $ | 1,524 | ||||||||
Granted | 113,821 | 11.96 | ||||||||||||
Forfeited / Cancelled | -218,844 | 14.39 | ||||||||||||
Exercised | -18,063 | 12.12 | ||||||||||||
Outstanding at January 28, 2012 | 795,376 | $ | 11.52 | 3 | $ | 2,831 | ||||||||
Granted | 441,791 | 13.65 | ||||||||||||
Forfeited / Cancelled | -24,600 | 14.54 | ||||||||||||
Exercised | -66,912 | 13.14 | ||||||||||||
Outstanding at February 2, 2013 | 1,145,655 | $ | 12.18 | 3.2 | $ | 1,467 | ||||||||
Granted | 213,859 | 15.26 | ||||||||||||
Forfeited / Cancelled | -135,716 | 13.18 | ||||||||||||
Exercised | -81,369 | 12.26 | ||||||||||||
Outstanding at February 1, 2014 | 1,142,429 | $ | 12.63 | 3 | $ | 5,539 | ||||||||
Exercisable at February 1, 2014 | 458,056 | $ | 10.74 | 1.4 | $ | 3,089 | ||||||||
The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the excess of Fred's closing stock price on the last trading day of the fiscal year end and the exercise price of the option multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on that date. This amount changes based on changes in the market value of Fred's stock. As of February 1, 2014, total unrecognized stock-based compensation expense net of estimated forfeitures related to non-vested stock options was approximately $1.5 million, which is expected to be recognized over a weighted average period of approximately 3.1 years. | ||||||||||||||
Other information relative to option activity during 2013, 2012 and 2011 is as follows: | ||||||||||||||
(dollars in thousands) | 2013 | 2012 | 2011 | |||||||||||
Total fair value of stock options vested | $ | 353 | $ | 543 | $ | 642 | ||||||||
Total pretax intrinsic value of stock options exercised | $ | 266 | $ | 76 | $ | 42 | ||||||||
The following table summarizes information about stock options outstanding at February 1, 2014: | ||||||||||||||
Options Outstanding | Options Exercisable | |||||||||||||
Range of Exercise Prices | Shares | Weighted- | Weighted- | Shares | Weighted- | |||||||||
Averaged | Average | Average | ||||||||||||
Contractual | Exercise Price | Exercise Price | ||||||||||||
Life (years) | ||||||||||||||
$ 8.66 - $12.75 | 455,769 | 1.4 | $ | 10.35 | 403,762 | $ | 10.36 | |||||||
$13.00 - $13.64 | 470,207 | 3.6 | $ | 13.57 | 34,924 | $ | 13.11 | |||||||
$13.72 - $18.03 | 216,453 | 5.2 | $ | 15.41 | 19,370 | $ | 14.3 | |||||||
1,142,429 | 458,056 | |||||||||||||
Restricted Stock. The Company’s equity incentive plans also allow for granting of restricted stock having a fixed number of shares at a purchase price that is set by the Compensation Committee of the Company’s Board of Directors, which purchase price may be set at zero, to certain executive officers, directors and key employees. The Company calculates compensation expense as the difference between the market price of the underlying stock on the date of grant and the purchase price if any. Restricted shares granted under the plan have various vesting types, which include cliff vesting and graded vesting with a requisite service period of three to ten years. Restricted stock has a maximum term of five to ten years from grant date. Compensation expense is recorded on a straight-line basis for shares that cliff vest and under the graded vesting attribution method for those that have graded vesting. If certain performance metrics are met, vesting may be accelerated and is recognized once achievement of the performance metric is considered probable. | ||||||||||||||
The following table summarizes restricted stock from January 29, 2011 through February 1, 2014: | ||||||||||||||
Shares | Weighted-Average | |||||||||||||
Grant Date | ||||||||||||||
Fair Value | ||||||||||||||
Non-vested Restricted Stock at January 29, 2011 | 472,927 | $ | 12.55 | |||||||||||
Granted | 396,830 | 12.59 | ||||||||||||
Forfeited / Cancelled | -91,375 | 12.12 | ||||||||||||
Exercised | -66,782 | 12.29 | ||||||||||||
Non-vested Restricted Stock at January 28, 2012 | 711,600 | $ | 12.56 | |||||||||||
Granted | 133,979 | 14.45 | ||||||||||||
Forfeited / Cancelled | -94,796 | 12.16 | ||||||||||||
Exercised | -129,774 | 12.26 | ||||||||||||
Non-vested Restricted Stock at February 2, 2013 | 621,009 | $ | 13.09 | |||||||||||
Granted | 113,943 | 14.72 | ||||||||||||
Forfeited / Cancelled | -125,686 | 13.22 | ||||||||||||
Exercised | -58,253 | 11.83 | ||||||||||||
Non-vested Restricted Stock at February 1, 2014 | 551,013 | $ | 13.53 | |||||||||||
The aggregate pre-tax intrinsic value of restricted stock outstanding as of February 1, 2014 is $9.6 million with a weighted average remaining contractual life of 5.2 years. The unrecognized compensation expense net of estimated forfeitures, related to the outstanding restricted stock is approximately $4.1 million, which is expected to be recognized over a weighted average period of approximately 6.2 years. The total fair value of restricted stock awards that vested for the years ended February 1, 2014, February 2, 2013 and January 28, 2012 was $0.7 million, $1.5 million and $0.9 million, respectively. | ||||||||||||||
There were no significant modifications to the Company’s share-based compensation plans during fiscal 2013, 2012 or 2011. | ||||||||||||||
NET_INCOME_PER_SHARE
NET INCOME PER SHARE | 12 Months Ended |
Feb. 01, 2014 | |
Earnings Per Share [Abstract] | ' |
Earnings Per Share [Text Block] | ' |
NOTE 9 — NET INCOME PER SHARE | |
Basic earnings per share excludes dilution and is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted earnings per share reflects the potential dilution that could occur if options to issue common stock were exercised into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. Restricted stock is a participating security and is therefore included in the computation of basic earnings per share. | |
Options to purchase shares of common stock that were outstanding at the end of the respective fiscal year were not included in the computation of diluted earnings per share when the options’ exercise prices were greater than the average market price of the common shares. There were 2,500, 482,588 and 2,500 such options outstanding at February 1, 2014, February 2, 2013 and January 28, 2012, respectively. | |
OTHER_COMMITMENTS_AND_CONTINGE
OTHER COMMITMENTS AND CONTINGENCIES | 12 Months Ended | ||||||||||
Feb. 01, 2014 | |||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||||||||
Commitments and Contingencies Disclosure [Text Block] | ' | ||||||||||
NOTE 10 — OTHER COMMITMENTS AND CONTINGENCIES | |||||||||||
Commitments. The Company had commitments approximating $5.6 million at February 1, 2014 and $7.4 million at February 2, 2013 on issued letters of credit and open accounts, which support purchase orders for merchandise. Additionally, the Company had outstanding letters of credit aggregating approximately $9.8 million at February 1, 2014 and $12.2 million at February 2, 2013 utilized as collateral for its risk management programs. | |||||||||||
Salary reduction profit sharing plan. The Company has defined contribution profit sharing plans for the benefit of qualifying employees who have completed three months of service and attained the age of 21. Participants may elect to make contributions to the plans up to 60% of their compensation or a maximum of $17,000. Company contributions are made at the discretion of the Company’s Board of Directors. Participants are 100% vested in their contributions and earnings thereon. Contributions by the Company and earnings thereon are fully vested upon completion of six years of service. The Company’s contributions for 2013, 2012 and 2011, were $0.2 million, $0.2 million and $0.2 million, respectively. | |||||||||||
Postretirement benefits. The Company provides certain health care benefits to its full-time employees that retire between the ages of 62 and 65 with certain specified levels of credited service. Health care coverage options for retirees under the plan are the same as those available to active employees. | |||||||||||
Effective February 3, 2007, the Company began recognizing the funded status of its postretirement benefits plan in accordance with FASB ASC 715, "Compensation Retirement Benefits". In accordance with FASB ASC 715 the Company is required to display the net over-or–underfunded position of a defined benefit postretirement plan as an asset or liability, with any unrecognized prior service costs, transition obligations or actuarial gains/losses reported as a component of accumulated other comprehensive income in shareholders’ equity. The measurement date for the plan in January 31. | |||||||||||
The Company’s change in benefit obligation based upon an actuarial valuation is as follows: | |||||||||||
For the Years Ended | |||||||||||
(in thousands) | February 1, | February 2, | January 28, | ||||||||
2014 | 2013 | 2012 | |||||||||
Benefit obligation at beginning of year | $ | 440 | $ | 472 | $ | 492 | |||||
Service cost | 29 | 22 | 25 | ||||||||
Interest cost | 17 | 15 | 20 | ||||||||
Actuarial loss (gain) | 122 | -35 | -33 | ||||||||
Benefits paid | -49 | -33 | -32 | ||||||||
Benefit obligation at end of year | $ | 559 | $ | 440 | $ | 472 | |||||
The Company’s components of net accumulated other comprehensive income were as follows: | |||||||||||
For the Years Ended | |||||||||||
(in thousands) | February 1, | February 2, | January 28, | ||||||||
2014 | 2013 | 2012 | |||||||||
Accumulated other comprehensive income | $ | 1,045 | $ | 1,246 | $ | 1,306 | |||||
Deferred tax | -342 | -452 | -442 | ||||||||
Accumulated other comprehensive income, net | $ | 703 | $ | 794 | $ | 864 | |||||
The medical care cost trend used in determining this obligation is 7.2% at February 1, 2014, decreasing annually throughout the actuarial projection period. The below table illustrates a one-percentage-point increase or decrease in the healthcare cost trend rate assumed for postretirement benefits: | |||||||||||
(in thousands) | February 1, | February 2, | January 28, | ||||||||
2014 | 2013 | 2012 | |||||||||
Effect of health care trend rate | |||||||||||
1% increase effect on accumulated benefit obligations | $ | 43 | $ | 36 | 40 | ||||||
1% increase effect on periodic cost | 5 | 4 | 5 | ||||||||
1% decrease effect on accumulated benefit obligations | -39 | -33 | -36 | ||||||||
1% decrease effect on periodic cost | -5 | -4 | -5 | ||||||||
The discount rate used in calculating the obligation was 3.6% in 2013 and 3.1% in 2012. | |||||||||||
The annual net postretirement cost is as follows: | |||||||||||
(in thousands) | February 1, | February 2, | January 28, | ||||||||
2014 | 2013 | 2012 | |||||||||
Service cost | $ | 29 | $ | 22 | $ | 25 | |||||
Interest cost | 17 | 15 | 20 | ||||||||
Amortization of prior service cost | -13 | -13 | -13 | ||||||||
Amortization of unrecognized prior service costs | -66 | -82 | -85 | ||||||||
Net periodic postretirement benefit cost | $ | -33 | $ | -58 | $ | -53 | |||||
The Company’s policy is to fund claims as incurred. Information about the expected cash flows for the postretirement medical plan follows: | |||||||||||
(in thousands) | Postretirement | ||||||||||
Medical Plan | |||||||||||
Expected Benefit Payments, net of retiree contributions | |||||||||||
2014 | $ | 51 | |||||||||
2015 | 50 | ||||||||||
2016 | 49 | ||||||||||
2017 | 48 | ||||||||||
2018 | 49 | ||||||||||
Next 5 years | 249 | ||||||||||
Litigation. In July 2008, a lawsuit styled Jessica Chapman, on behalf of herself and others similarly situated, v. Fred's Stores of Tennessee, Inc. was filed in the United States District Court for the Northern District of Alabama, Southern Division, in which the plaintiff alleges that she and other female assistant store managers are paid less than comparable males and seeks compensable damages, liquidated damages, attorney fees and court costs. The plaintiff filed a motion seeking collective action. On or about March 15, 2013, the Magistrate Judge issued a Report and Recommendation that the case be conditionally certified as a collective action, which the District Court Judge affirmed. As a result, notice of a collective action was sent to the appropriate class as required by the Court. Approximately 194 plaintiffs have opted into the suit. The Company believes that all of its assistant managers have been properly paid and that the matter is not appropriate for collective action treatment. The Company is and will continue to vigorously defend this matter; however, it is not possible to predict whether Chapman will ultimately be able to proceed collectively and no assurances can be given that the Company will be successful in the defense of the action on the merits or otherwise. In accordance with FASB ASC 450, “Contingencies”, the Company does not believe at this time that a loss in this matter is probable. For these reasons, the Company is unable to estimate any potential loss or range of loss in the matter. The Company has tendered the matter to its Employment Practices Liability Insurance (“EPLI”) carrier for coverage under its EPLI policy. At this time, the Company expects that the EPLI carrier will participate in the defense or resolution of part or all of the potential claims. | |||||||||||
In addition to the matters disclosed above, the Company is party to several pending legal proceedings and claims arising in the normal course of business. Although the outcome of the proceedings and claims cannot be determined with certainty, management of the Company is of the opinion that these proceedings and claims should not have a material adverse effect on the financial statements as a whole. However, litigation involves an element of uncertainty. Future developments could cause these actions or claims, individually or in aggregate, to have a material adverse effect on the financial statements as a whole. | |||||||||||
SALES_MIX
SALES MIX | 12 Months Ended | |||||||||
Feb. 01, 2014 | ||||||||||
Segment Reporting [Abstract] | ' | |||||||||
Segment Reporting Disclosure [Text Block] | ' | |||||||||
NOTE 11 – SALES MIX | ||||||||||
The Company manages its business on the basis of one reportable segment. See Note 1 – “Description of Business and Summary of Significant Accounting Policies” for a brief description of the Company’s business. As of February 1, 2014, all of the Company’s operations were located within the United States. The following data is presented in accordance with FASB ASC 280, “Segment Reporting.” | ||||||||||
The Company’s sales mix by major category during the last 3 years was as follows: | ||||||||||
For the Years Ended | ||||||||||
February 1, | February 2, | January | ||||||||
2014 | 2013 | 28, 2012 | ||||||||
Pharmaceuticals | 37.7 | % | 36.3 | % | 34.9 | % | ||||
Household Goods | 21.8 | % | 22.6 | % | 23.3 | % | ||||
Food and Tobacco Products | 17.6 | % | 16.7 | % | 16.8 | % | ||||
Paper and Cleaning Supplies | 8.4 | % | 8.8 | % | 8.7 | % | ||||
Health and Beauty Aids | 7 | % | 7.5 | % | 7.4 | % | ||||
Apparel and Linens | 5.8 | % | 6.3 | % | 6.9 | % | ||||
Sales to Franchised Fred's Stores | 1.7 | % | 1.8 | % | 2 | % | ||||
Total Sales Mix | 100 | % | 100 | % | 100 | % | ||||
EXIT_AND_DISPOSAL_ACTIVITY
EXIT AND DISPOSAL ACTIVITY | 12 Months Ended | |||||||||
Feb. 01, 2014 | ||||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | |||||||||
Disposal Groups Including Discontinued Operations Disclosure [Text Block] | ' | |||||||||
NOTE 12 – EXIT AND DISPOSAL ACTIVITY | ||||||||||
Lease Termination | ||||||||||
For store closures where a lease obligation exists, we record the estimated future liability associated with the rental obligation on the cease use date (when the stores were closed). The lease obligations are established at the cease use date for the present value of any remaining operating lease obligations, net of estimated sublease income, and at the communication date for severance and other exit costs, as prescribed by FASB ASC 420, “Exit or Disposal Cost Obligations”. Key assumptions in calculating the liability include the timeframe expected to terminate lease agreements, estimates related to the sublease potential of closed locations, and estimates of other related exit costs. If actual timing and potential termination costs or realization of sublease income differ from our estimates, the resulting liabilities could vary from recorded amounts. These liabilities are reviewed periodically and adjusted when necessary. | ||||||||||
During fiscal 2013, we utilized $0.1 million of the remaining lease liability for the fiscal 2008 store closures, leaving $0.1 million in the reserve at February 1, 2014. | ||||||||||
The following table illustrates the exit and disposal activity related to the store closures discussed in the previous paragraphs (in millions): | ||||||||||
(in millions) | Beginning | Additions | Utilized | Ending | ||||||
Balance | FY13 | FY13 | Balance | |||||||
February 2, | February 1, | |||||||||
2013 | 2014 | |||||||||
Lease contract termination liability | 0.2 | - | -0.1 | 0.1 | ||||||
QUARTERLY_FINANCIAL_DATA_UNAUD
QUARTERLY FINANCIAL DATA (UNAUDITED) | 12 Months Ended | |||||||||||||
Feb. 01, 2014 | ||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | |||||||||||||
Quarterly Financial Information [Text Block] | ' | |||||||||||||
NOTE 13 – QUARTERLY FINANCIAL DATA (UNAUDITED) | ||||||||||||||
The Company’s unaudited quarterly financial information for the fiscal years ended February 1, 2014 and February 2, 2013 is reported below: | ||||||||||||||
(in thousands, except per share data) | First Quarter | Second | Third | Fourth | ||||||||||
Quarter | Quarter | Quarter | ||||||||||||
Year ended February 1, 2014 | ||||||||||||||
Net sales | $ | 501,495 | $ | 482,176 | $ | 460,542 | $ | 495,033 | ||||||
Gross profit | 151,019 | 135,985 | 140,237 | 133,600 | ||||||||||
Net income | 11,411 | 3,330 | 7,308 | 3,966 | ||||||||||
Net income per share | ||||||||||||||
Basic | $ | 0.31 | $ | 0.09 | $ | 0.2 | $ | 0.11 | ||||||
Diluted | $ | 0.31 | $ | 0.09 | $ | 0.2 | $ | 0.11 | ||||||
Cash dividends paid per common share | $ | 0.06 | $ | 0.06 | $ | 0.06 | $ | 0.06 | ||||||
Year ended February 2, 2013 | ||||||||||||||
Net sales | $ | 500,505 | $ | 470,816 | $ | 450,574 | $ | 533,380 | ||||||
Gross profit | 147,842 | 131,758 | 138,133 | 148,599 | ||||||||||
Net income | 10,458 | 6,054 | 6,561 | 6,556 | ||||||||||
Net income per share | ||||||||||||||
Basic | $ | 0.28 | $ | 0.17 | $ | 0.18 | $ | 0.18 | ||||||
Diluted | $ | 0.28 | $ | 0.17 | $ | 0.18 | $ | 0.18 | ||||||
Cash dividends paid per common share 1 | $ | 0.06 | $ | 0.06 | $ | 0.06 | $ | 0.25 | ||||||
1. The $0.25 cash dividend per share paid in the fourth quarter of 2012 consists of a one-time special dividend of $0.19 and the $0.06 regular quarterly dividend. | ||||||||||||||
CUMULATIVE_EFFECT_OF_A_CORRECT
CUMULATIVE EFFECT OF A CORRECTION OF AN ERROR IN THE CASH FLOW STATEMENT | 12 Months Ended |
Feb. 01, 2014 | |
Accounting Changes and Error Corrections [Abstract] | ' |
Accounting Changes and Error Corrections [Text Block] | ' |
NOTE 14: CUMULATIVE EFFECT OF A CORRECTION OF AN ERROR IN THE CASH FLOW STATEMENT | |
In the second quarter of 2013, the Condensed Consolidated Statements of Cash Flows (Cash Flows Statement), as presented in our filed Form 10-Q, was changed to correct the presentation of proceeds received and net gain resulting from the sale of pharmacy department prescription files. From time-to-time, the Company closes an underperforming pharmacy department and sells the related prescription files. In previous filings, the proceeds received and gain resulting from the sale of pharmacy department prescription files were neither presented on the face of the Cash Flows Statement as an addition to cash flows provided by investing activities nor as a reduction to cash flows provided by operating activities. Prospectively, the proceeds received from the sale of pharmacy prescription files will be shown on the face of the Cash Flows Statement as part of proceeds from asset dispositions in investing activities, and the net gain from the sale will be presented as a part of net loss (gain) on asset disposition in operating activities. | |
In accordance with Staff Accounting Bulletin 99, quantifying the impact of the corrected presentation on our Cash Flows Statement, we have determined that the quantitative impact on the Cash Flows Statement was immaterial to both the net cash provided by operating activities and the net cash used by investing activities. In addition, qualitatively, this misstatement had no effect on the Consolidated Income Statements or Consolidated Balance Sheets presented in our filed Form 10-Qs or Form 10-Ks from fiscal year 2011 through the first quarter of 2013. Additionally, there was no impact on our debt covenant requirements or our previous Liquidity and Capital Resources disclosures. | |
Schedule_II_Valuation_and_Qual
Schedule II - Valuation and Qualifying Accounts | 12 Months Ended | |||||||||||||
Feb. 01, 2014 | ||||||||||||||
Valuation and Qualifying Accounts [Abstract] | ' | |||||||||||||
Schedule of Valuation and Qualifying Accounts Disclosure [Text Block] | ' | |||||||||||||
Schedule II — Valuation and Qualifying Accounts | ||||||||||||||
(dollars in thousands) | Beginning Balance | Additions Charged | Deductions and | Ending Balance | ||||||||||
to Costs and | Reclass | |||||||||||||
Expenses | Adjustments | |||||||||||||
Deducted from applicable assets: | ||||||||||||||
Allowance for doubtful accounts | ||||||||||||||
Year ended February 1, 2014 | $ | 1,994 | $ | 1,198 | $ | 1,095 | $ | 2,097 | ||||||
Year ended February 2, 2013 | $ | 2,100 | $ | 627 | $ | 733 | $ | 1,994 | ||||||
Year ended January 28, 2012 | $ | 1,652 | $ | 841 | $ | 393 | $ | 2,100 | ||||||
Insurance reserves | ||||||||||||||
Year ended February 1, 2014 | $ | 10,094 | $ | 41,917 | $ | 41,537 | $ | 10,474 | ||||||
Year ended February 2, 2013 | $ | 10,291 | $ | 43,761 | $ | 43,958 | $ | 10,094 | ||||||
Year ended January 28, 2012 | $ | 10,252 | $ | 49,058 | $ | 49,019 | $ | 10,291 | ||||||
DESCRIPTION_OF_BUSINESS_AND_SU1
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | |||
Feb. 01, 2014 | ||||
Accounting Policies [Abstract] | ' | |||
Consolidation, Policy [Policy Text Block] | ' | |||
Consolidated Financial Statements. The Consolidated Financial Statements include the accounts of Fred's, Inc. and its subsidiaries. All significant intercompany accounts and transactions are eliminated. Amounts are in thousands unless otherwise noted. | ||||
Subsequent Events, Policy [Policy Text Block] | ' | |||
Subsequent Events. The Company has evaluated events subsequent to the balance sheet date. Based on this evaluation, we are not aware of any events or transactions requiring recognition or disclosure in our consolidated financial statements. | ||||
Fiscal Period, Policy [Policy Text Block] | ' | |||
Fiscal year. The Company utilizes a 52 - 53 week accounting period which ends on the Saturday closest to January 31. Fiscal years 2013, 2012 and 2011, as used herein, refer to the years ended February 1, 2014, February 2, 2013 and January 28, 2012, respectively. Fiscal year 2012 had 53 weeks, and fiscal years 2013 and 2011 each had 52 weeks. | ||||
Use of Estimates, Policy [Policy Text Block] | ' | |||
Use of estimates. The preparation of financial statements in accordance with U.S. Generally Accepted Accounting Principles ("U.S. GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates and such differences could be material to the financial statements. | ||||
Cash and Cash Equivalents, Policy [Policy Text Block] | ' | |||
Cash and cash equivalents. Cash on hand and in banks, together with other highly liquid investments which are subject to market fluctuations and having original maturities of three months or less, are classified as cash and cash equivalents. | ||||
Premiums Receivable, Allowance for Doubtful Accounts, Estimation Methodology, Policy [Policy Text Block] | ' | |||
Allowance for doubtful accounts. The Company is reimbursed for drugs sold by its pharmacies by many different payors including insurance companies, Medicare and various state Medicaid programs. The Company estimates the allowance for doubtful accounts based on the aging of receivables and additionally uses payor-specific information to assess collection risk, given its interpretation of the contract terms or applicable regulations. However, the reimbursement rates are often subject to interpretations that could result in payments that differ from the Company’s estimates. Additionally, updated regulations and contract negotiations occur frequently, necessitating the Company’s continual review and assessment of the estimation process. Senior management reviews accounts receivable on a quarterly basis to determine if any receivables are potentially uncollectible. The Company includes any accounts receivable balances that are determined to be uncollectible in its overall allowance for doubtful accounts. After all attempts to collect a receivable have failed, the receivable is written off against the allowance account. | ||||
Inventory, Policy [Policy Text Block] | ' | |||
Inventories. Merchandise inventories are stated at the lower of cost or market using the retail first-in, first-out method for goods in our stores and the cost first-in, first-out method for goods in our distribution centers. The retail inventory method is a reverse mark-up, averaging method which has been widely used in the retail industry for many years. This method calculates a cost-to-retail ratio that is applied to the retail value of inventory to determine the cost value of inventory and the resulting cost of goods sold and gross margin. The assumption that the retail inventory method provides for valuation at lower of cost or market and the inherent uncertainties therein are discussed in the following paragraphs. | ||||
In order to assure valuation at the lower of cost or market, the retail value of our inventory is adjusted on a consistent basis to reflect current market conditions. These adjustments include increases to the retail value of inventory for initial markups to set the selling price of goods or additional markups to adjust pricing for inflation and decreases to the retail value of inventory for markdowns associated with promotional, seasonal or other declines in the market value. Because these adjustments are made on a consistent basis and are based on current prevailing market conditions, they approximate the carrying value of the inventory at net realizable value. Therefore, after applying the cost to retail ratio, the cost value of our inventory is stated at the lower of cost or market as is prescribed by U.S. GAAP. In the fourth quarter of 2014, the Company recorded an inventory markdown reserve totaling $1.7 million or $0.03 per diluted share related to general merchandise categories (footwear, select indoor furniture and electronics, primarily televisions) the Company has chosen to exit. | ||||
Because the approximation of net realizable value under the retail inventory method is based on estimates such as markups, markdowns and inventory losses (shrink), there exists an inherent uncertainty in the final determination of inventory cost and gross margin. In order to mitigate that uncertainty, the Company has a formal review by product class which considers such variables as current market trends, seasonality, weather patterns and age of merchandise to ensure that markdowns are taken currently, or a markdown reserve is established to cover future anticipated markdowns. This review also considers current pricing trends and inflation to ensure that markups are taken if necessary. The estimation of inventory losses is a significant element in approximating the carrying value of inventory at net realizable value, and as such the following paragraph describes our estimation method as well as the steps we take to mitigate the risk that this estimate has in the determination of the cost value of inventory. | ||||
The Company calculates inventory losses based on actual inventory losses occurring as a result of physical inventory counts during each fiscal period and estimated inventory losses occurring between yearly physical inventory counts. The estimate for shrink occurring in the interim period between physical counts is calculated on a store-specific basis and is based on history, as well as performance on the most recent physical count. It is calculated by multiplying each store’s shrink rate, which is based on the previously mentioned factors, by the interim period’s sales for each store. Additionally, the overall estimate for shrink is adjusted at the corporate level to a three-year historical average to ensure that the overall shrink estimate is the most accurate approximation of shrink based on the Company’s overall history of shrink. The three-year historical estimate is calculated by dividing the “book to physical” inventory adjustments for the trailing 36 months by the related sales for the same period. In order to reduce the uncertainty inherent in the shrink calculation, the Company first performs the calculation at the lowest practical level (by store) using the most current performance indicators. This ensures a more reliable number, as opposed to using a higher level aggregation or percentage method. The second portion of the calculation ensures that the extreme negative or positive performance of any particular store or group of stores does not skew the overall estimation of shrink. This portion of the calculation removes additional uncertainty by eliminating short-term peaks and valleys that could otherwise cause the underlying carrying value of inventory to fluctuate unnecessarily. The methodology that we have applied in estimating shrink has resulted in variability in result that is not material to our financial statements. The Company has experienced improvement in reducing shrink as a percentage of sales from year to year due to improved inventory control measures, which includes the chain-wide utilization of the NEX/DEX technology. | ||||
Management believes that the Company’s retail inventory method provides an inventory valuation which reasonably approximates cost and results in valuing inventory at the lower of cost or market. For pharmacy department inventories, which were approximately $40.4 million, and $33.8 million at February 1, 2014 and February 2, 2013, respectively, cost was determined using the retail LIFO ("last-in, first-out") method in which inventory cost is maintained using the retail inventory method, then adjusted by application of the highly inflationary Producer Price Index published by the U.S. Department of Labor for the cumulative annual periods. The current cost of inventories exceeded the LIFO cost by approximately $35.2 million at February 1, 2014 and $30.7 million at February 2, 2013. The LIFO reserve increased by approximately $4.5 million and $3.9 million during 2013 and 2012, respectively. | ||||
The Company has historically included an estimate of inbound freight and certain general and administrative costs in merchandise inventory as prescribed by U.S. GAAP. These costs include activities surrounding the procurement and storage of merchandise inventory such as merchandise planning and buying, warehousing, accounting, information technology and human resources, as well as inbound freight. The total amount of procurement and storage costs and inbound freight included in merchandise inventory at February 1, 2014 is $21.6 million compared to $21.6 million at February 2, 2013. | ||||
The Company did not record any below-cost inventory adjustments during the years ended February 1, 2014, February 2, 2013 and January 28, 2012 in connection with planned store closures (see Note 12 - Exit and Disposal Activity). | ||||
Property, Plant and Equipment, Policy [Policy Text Block] | ' | |||
Property and equipment. Property and equipment are carried at cost. Depreciation is recorded using the straight-line method over the estimated useful lives of the assets and presented in selling, general and administrative expenses. Improvements to leased premises are amortized using the straight-line method over the shorter of the initial term of the lease or the useful life of the improvement. Leasehold improvements added late in the lease term are amortized over the lesser of the remaining term of the lease (including the upcoming renewal option, if the renewal is reasonably assured) or the estimated useful life of the improvement. Gains or losses on the sale of assets are recorded at disposal. The following average estimated useful lives are generally applied: | ||||
Estimated Useful Lives | ||||
Building and building improvements | 8 - 31.5 years | |||
Furniture, fixtures and equipment | 3 - 10 years | |||
Leasehold improvements | 3 - 10 years or term of lease, if shorter | |||
Automobiles and vehicles | 3 - 10 years | |||
Airplane | 9 years | |||
Assets under capital lease are amortized in accordance with the Company’s normal depreciation policy for owned assets or over the lease term (regardless of renewal options), if shorter, and the charge to earnings is included in depreciation expense in the Consolidated Financial Statements. Amortization expense on assets under capital lease for 2013 was $34 thousand. | ||||
Lease, Policy [Policy Text Block] | ' | |||
Leases. Certain operating leases include rent increases during the initial lease term. For these leases, the Company recognizes the related rental expense on a straight-line basis over the term of the lease (which includes the pre-opening period of construction, renovation, fixturing and merchandise placement) and records the difference between the amounts charged to operations and amounts paid as a rent liability. Rent expense is recognized on a straight-line basis over the lease term, which includes any rent holiday period. | ||||
The Company recognizes contingent rental expense when the achievement of specified sales targets are considered probable in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 840 “Leases”. The amount expensed but not paid was $0.8 million and $0.7 million at February 1, 2014 and February 2, 2013, respectively, and is included in “Accrued expenses and other” in the consolidated balance sheet (See Note 2 - Detail of Certain Balance Sheet Accounts). | ||||
The Company occasionally receives reimbursements from landlords to be used towards construction of the store the Company intends to lease. The reimbursement is primarily for the purpose of performing work required to divide a much larger location into smaller segments, one of which the Company will use for its store. This work could include the addition or demolition of walls, separation of plumbing, utilities, electrical work, entrances (front and back) and other work as required. Leasehold improvements are recorded at their gross costs including items reimbursed by landlords. The reimbursements are initially recorded as a deferred credit and then amortized as a reduction of rent expense over the initial lease term. | ||||
Based upon an overall analysis of store performance and expected trends, we periodically evaluate the need to close underperforming stores. When we determine that an underperforming store should be closed and a lease obligation still exists, we record the estimated future liability associated with the rental obligation on the date the store is closed in accordance with FASB ASC 420, “Exit or Disposal Cost Obligations.” Liabilities are computed based at the point of closure for the present value of any remaining operating lease obligations, net of estimated sublease income, and at the communication date for severance and other exit costs, as prescribed by FASB ASC 420. The assumptions in calculating the liability include the timeframe expected to terminate the lease agreement, estimates related to the sublease of potential closed locations, and estimation of other related exit costs. If the actual timing and the potential termination costs or realization of sublease income differ from our estimates, the resulting liabilities could vary from recorded amounts. We periodically review the liability for closed stores and make adjustments when necessary. | ||||
Impairment or Disposal of Long-Lived Assets, Including Intangible Assets, Policy [Policy Text Block] | ' | |||
Impairment of long-lived assets. The Company’s policy is to review the carrying value of all property and equipment as well as purchased intangible assets subject to amortization for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. In accordance with FASB ASC 360, “Impairment or Disposal of Long-Lived Assets,” we review for impairment all stores open at least 3 years or remodeled for more than two years. Impairment results when the carrying value of the assets exceeds the undiscounted future cash flows over the life of the lease, or 10 years for owned stores. Our estimate of undiscounted future cash flows over the lease term is based upon historical operations of the stores and estimates of future store profitability which encompasses many factors that are subject to management’s judgment and are difficult to predict. If a long-lived asset is found to be impaired, the amount recognized for impairment is equal to the difference between the carrying value and the asset’s fair value. The fair value is based on estimated market values for similar assets or other reasonable estimates of fair market value based upon using a discounted cash flow model. | ||||
No impairments were recognized in 2013, 2012 or 2011. | ||||
Revenue Recognition, Policy [Policy Text Block] | ' | |||
Revenue recognition. The Company markets goods and services through 683 company-owned stores and 21 franchised stores as of February 1, 2014. Net sales includes sales of merchandise from company-owned stores, net of returns and exclusive of sales taxes. Sales to franchised stores are recorded when the merchandise is shipped from the Company’s warehouse. Revenues resulting from layaway sales are recorded upon delivery of the merchandise to the customer. | ||||
The Company also sells gift cards for which the revenue is recognized at time of redemption. The Company records a gift card liability on the date the gift card is issued to the customer. Revenue is recognized and the gift card liability is reduced as the customer redeems the gift card. The Company will recognize aged liabilities as revenue when the likelihood of the gift card being redeemed is remote. The Company has not recognized any revenue from gift card breakage since the inception of the program in May 2004 and does not expect to record any gift card breakage revenue until there is more certainty regarding our ability to retain such amounts in light of current consumer protection and state escheatment laws. | ||||
In addition, the Company charges the franchised stores a fee based on a percentage of their purchases from the Company. These fees represent a reimbursement for use of the Fred's name and other administrative costs incurred on behalf of the franchised stores and are therefore netted against selling, general and administrative expenses. Total franchise income for 2013, 2012 and 2011 was $1.6 million, $1.7 million and $1.8 million, respectively. | ||||
Cost of Goods Sold [Policy Text Block] | ' | |||
Cost of goods sold. Cost of goods sold includes the purchase cost of inventory and the freight costs to the Company’s distribution centers. Warehouse and occupancy costs, including depreciation and amortization, are not included in cost of goods sold, but are included as a component of selling, general and administrative expenses. | ||||
Cost of Sales, Vendor Allowances, Policy [Policy Text Block] | ' | |||
Vendor rebates and allowances. The Company receives rebates for a variety of merchandising activities, such as volume commitment rebates, relief for temporary and permanent price reductions, cooperative advertising programs, and for the introduction of new products in our stores. FASB ASC 605-50 “Customer Payments and Incentives” addresses the accounting and income statement classification for consideration given by a vendor to a retailer in connection with the sale of the vendor’s products or for the promotion of sales of the vendor’s products. Such consideration received from vendors is reflected as a decrease in prices paid for inventory and recognized in cost of sales as the related inventory is sold, unless specific criteria are met qualifying the consideration for treatment as reimbursement of specific, identifiable incremental costs. | ||||
Selling, General and Administrative Expenses, Policy [Policy Text Block] | ' | |||
Selling, general and administrative expenses. The Company includes buying, warehousing, distribution, advertising, depreciation and amortization and occupancy costs in selling, general and administrative expenses. | ||||
Advertising Costs, Policy [Policy Text Block] | ' | |||
Advertising. In accordance with FASB ASC 720-35 “Advertising Costs”, the Company charges advertising, including production costs, to selling, general and administrative expense on the first day of the advertising period. Gross advertising expenses for 2013, 2012 and 2011, were $22.8 million, $24.0 million and $21.9 million, respectively. Gross advertising expenses were reduced by vendor cooperative advertising allowances of $2.8 million, $2.4 million and $2.4 million, for 2013, 2012 and 2011, respectively. It would be the Company’s intention to incur a similar amount of advertising expense as in prior years and in support of our stores even if we did not receive support from our vendors in the form of cooperative advertising programs. | ||||
Preopening Costs [Policy Text Block] | ' | |||
Preopening costs. The Company charges to expense the preopening costs of new stores as incurred. These costs are primarily labor to stock the store, rent, preopening advertising, store supplies and other expendable items. | ||||
Intangible Assets, Finite-Lived, Policy [Policy Text Block] | ' | |||
Intangible assets. Other identifiable intangible assets primarily represent customer lists associated with acquired pharmacies and are being amortized on a straight-line basis over seven years. After testing the retention rate of customers obtained in acquisitions over the last eight years, the Company changed the estimated life of customer lists associated with acquired pharmacies from five to seven years in the fourth quarter of 2013. Based on the Company's historical experience, seven years is a closer approximation of the actual lives of these assets. The change in estimate is applied prospectively. Expenses for the fourth quarter of 2013 were favorably impacted by approximately $1.5 million ($.03 per diluted share) as a result of this change. The Company expects this change in estimate to have a positive effect on earnings across all four quarters of 2014. Intangibles, net of accumulated amortization, totaled $54.6 million at February 1, 2014, and $41.9 million at February 2, 2013. Accumulated amortization at February 1, 2014 and February 2, 2013 totaled $54.3 million and $42.2 million, respectively. Amortization expense for 2013, 2012 and 2011, was $12.1 million, $10.5 million and $6.9 million, respectively. Estimated amortization expense for the assets recognized as of February 1, 2014, in millions for each of the next 7 years is as follows: 2014 - $9.8 million, 2015 - $9.7 million, 2016 - $9.5 million, 2017 - $8.7 million, 2018 - $7.5 million, 2019 - $5.1 million and 2020 - $2.8 million. | ||||
Fair Value of Financial Instruments, Policy [Policy Text Block] | ' | |||
Fair value of financial instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy, as defined below, gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. | ||||
⋅ | Level 1, defined as quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date. | |||
⋅ | Level 2, defined as Inputs other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly. | |||
⋅ | Level 3, defined as unobservable inputs for the asset or liability. | |||
At February 1, 2014, the Company did not have any outstanding derivative instruments. The recorded value of the Company’s financial instruments, which include cash and cash equivalents, receivables, accounts payable and indebtedness, approximates fair value. The following methods and assumptions were used to estimate fair value of each class of financial instrument: (1) the carrying amounts of current assets and liabilities approximate fair value because of the short maturity of those instruments and (2) the fair value of the Company’s indebtedness is estimated based on the current borrowing rates available to the Company for bank loans with similar terms and average maturities. Most of our indebtedness is under variable interest rates. | ||||
Self Insurance Reserve [Policy Text Block] | ' | |||
Insurance reserves. The Company is largely self-insured for workers compensation, general liability and employee medical insurance. The Company’s liability for self-insurance is determined based on claims known at the time of determination of the reserve and estimates for future payments against incurred losses and claims that have been incurred but not reported. Estimates for future claims costs include uncertainty because of the variability of the factors involved, such as the type of injury or claim, required services by the providers, healing time, age of claimant, case management costs, location of the claimant, and governmental regulations. These uncertainties or a deviation in future claims trends from recent historical patterns could result in the Company recording additional expenses or expense reductions that might be material to the Company’s results of operations. The Company’s worker's compensation and general liability insurance policy coverages run August 1 through July 31 of each fiscal year. Our employee medical insurance policy coverage runs from January 1 through December 31. The Company purchases excess insurance coverage for certain of its self-insured liabilities, or stop loss coverage. The stop loss limits for excessive or catastrophic claims for general liability remained at $350,000, worker’s compensation remained at $500,000 and employee medical remained at $175,000. The Company’s insurance reserve was $10.5 million and $10.1 million on February 1, 2014 and February 2, 2013, respectively. Changes in the reserve for the year ended February 1, 2014, over that time period were attributable to additional reserve requirements of $41.9 million netted with payments of $41.5 million. | ||||
Compensation Related Costs, Policy [Policy Text Block] | ' | |||
Stock-based compensation. The Company uses the fair value recognition provisions of FASB ASC 718, “Compensation – Stock Compensation”, whereby the Company recognizes share-based payments to employees and directors in the Consolidated Statements of Income on a straight-line basis over the requisite service period based on the fair value of the award. | ||||
Effective January 29, 2006, the Company elected to adopt the alternative transition method provided in FASB ASC 718 for calculating the income tax effects of stock-based compensation. The alternative transition method includes simplified methods to establish the beginning balance of the additional paid-in-capital pool (“APIC Pool”) related to the income tax effects of stock based compensation, and for determining the subsequent impact on the APIC pool and consolidated statements of cash flows of the income tax effects of stock-based compensation awards that are outstanding upon adoption of FASB ASC 718. | ||||
FASB ASC 718 also requires the benefits of income tax deductions in excess of recognized compensation cost to be reported as a financing cash flow, rather than as an operating cash flow. The impact of adopting FASB ASC 718 on future results will depend on, among other things, levels of share-based payments granted in the future, actual forfeiture rates and the timing of option exercises. | ||||
Stock-based compensation expense, post adoption of FASB ASC 718, is based on awards ultimately expected to vest, and therefore has been reduced for estimated forfeitures. Forfeitures are estimated at the time of grant based on the Company’s historical forfeiture experience and will be revised in subsequent periods if actual forfeitures differ from those estimates. | ||||
Income Tax, Policy [Policy Text Block] | ' | |||
Income taxes. The Company reports income taxes in accordance with FASB ASC 740, “Income Taxes.” Under FASB ASC 740, the asset and liability method is used for computing future income tax consequences of events, which have been recognized in the Company’s Consolidated Financial Statements or income tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred income tax expense or benefit is the net change during the year in the Company’s deferred income tax assets and liabilities (see Note 5 – Income Taxes). | ||||
The Company also applies the guidance of FASB ASC 740-10-25, Income Taxes, Uncertain Tax Positions, which clarifies the accounting for uncertainties in income taxes recognized in the Company’s financial statements in accordance with FASB ASC 740 by defining the criterion that an individual tax position must meet in order to be recognized in the financial statements. FASB ASC 740 requires that the tax effects of a position be recognized only if it is “more-likely-than-not” to be sustained based solely on the technical merits as of the reporting date (see Note 5 – Income Taxes). | ||||
Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. Significant judgment is required in evaluating the need for and magnitude of appropriate valuation allowances against deferred tax assets. The realization of these assets is dependent on generating future taxable income, as well as successful implementation of various tax planning strategies. | ||||
While Fred’s believes that these judgments and estimates are appropriate and reasonable under the circumstances, actual resolution of these matters may differ from recorded estimated amounts. | ||||
Segment Reporting, Policy [Policy Text Block] | ' | |||
Business segments. The Company manages the business on the basis of one operating segment and therefore, has only one reportable segment. All operations are located in the United States. | ||||
Comprehensive Income, Policy [Policy Text Block] | ' | |||
Comprehensive income. Comprehensive income consists of two components, net income and other comprehensive income (loss). Other comprehensive income (loss) refers to gains and losses that under generally accepted accounting principles are recorded as an element of shareholders’ equity but are excluded from net income. The Company’s accumulated other comprehensive income includes the effect of adopting SFAS No. 158, Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No. 87, 88, 106, and 132(R)(“SFAS No. 158”) codified in FASB ASC 715 “Compensation – Retirement Benefits”. See Note 10, Commitments and Contingencies, in the Notes to Consolidated Financial Statements for further discussion. | ||||
Reclassification, Policy [Policy Text Block] | ' | |||
Reclassifications. Certain prior year amounts have been reclassified to conform to the 2013 presentation. | ||||
New Accounting Pronouncements, Policy [Policy Text Block] | ' | |||
Recent Accounting Pronouncements. In June 2011, the Financial Accounting Standards Board issued ASU 2011-05, Comprehensive Income (Topic 22): Presentation of Comprehensive Income, which revised the current practice of including other comprehensive income within the equity section of the statement of financial position and requires disclosure of other comprehensive income either in a single continuous statement of comprehensive income or in a separate statement. This guidance became effective in fiscal 2012. The adoption of ASU 2011-05 did not have an impact on the Company’s consolidated net earnings, cash flows or financial position, but the adoption did change the presentation of other comprehensive income in the Company’s consolidated financial statements. In February 2013, an update was issued regarding ASU 2011-05, which requires an entity to present, either on the face of the income statement or as a separate disclosure in the notes to the consolidated financial statements, the effects on net income of significant amounts reclassified out of each component of accumulated other comprehensive income if those amounts all are required under other Topics to be reclassified to net income in their entirety in the same reporting period. The update of ASU 2011-05 did not have an impact on the Company’s consolidated net earnings, cash flows or financial position. | ||||
In July 2013, the Financial Accounting Standards Board issued ASU 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Task Force). This guidance will be effective in the first quarter of 2014. The amendments in this ASU state that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. We do not expect this guidance will require a change in the current presentation of unrecognized tax benefits. | ||||
DESCRIPTION_OF_BUSINESS_AND_SU2
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(Tables) | 12 Months Ended | |||
Feb. 01, 2014 | ||||
Accounting Policies [Abstract] | ' | |||
Property, Plant and Equipment [Table Text Block] | ' | |||
The following average estimated useful lives are generally applied: | ||||
Estimated Useful Lives | ||||
Building and building improvements | 8 - 31.5 years | |||
Furniture, fixtures and equipment | 3 - 10 years | |||
Leasehold improvements | 3 - 10 years or term of lease, if shorter | |||
Automobiles and vehicles | 3 - 10 years | |||
Airplane | 9 years | |||
DETAIL_OF_CERTAIN_BALANCE_SHEE1
DETAIL OF CERTAIN BALANCE SHEET ACCOUNTS (Tables) | 12 Months Ended | |||||||
Feb. 01, 2014 | ||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |||||||
Schedule of Details of Certain Balance Sheet Accounts [Table Text Block] | ' | |||||||
Details of certain balance sheet accounts as of February 1, 2014 and February 2, 2013 are as follows: | ||||||||
(in thousands) | ||||||||
Property and equipment, at cost: | 2013 | 2012 | ||||||
Buildings and building improvements | $ | 114,688 | $ | 113,164 | ||||
Leasehold improvements | 78,101 | 74,552 | ||||||
Automobiles and vehicles | 5,459 | 5,601 | ||||||
Airplane | 4,697 | 4,697 | ||||||
Furniture, fixtures and equipment | 268,771 | 265,916 | ||||||
471,716 | 463,930 | |||||||
Less: Accumulated depreciation and amortization | -328,686 | -315,175 | ||||||
143,030 | 148,755 | |||||||
Construction in progress | 1,729 | 1,035 | ||||||
Land | 8,604 | 8,604 | ||||||
Total Property and equipment, at depreciated cost | $ | 153,363 | $ | 158,394 | ||||
(in thousands) | ||||||||
Other non-trade receivables: | 2013 | 2012 | ||||||
Vendor receivables | $ | 30,431 | $ | 26,728 | ||||
Income tax receivable | 3,159 | 2,217 | ||||||
Franchise stores receivable | 1,537 | 1,157 | ||||||
Insurance claims receivable | - | 474 | ||||||
Coupon receivable | 400 | 457 | ||||||
Other | 1,963 | 2,240 | ||||||
Total other non-trade receivable | $ | 37,490 | $ | 33,273 | ||||
Prepaid expenses and other current assets: | 2013 | 2012 | ||||||
Prepaid rent | $ | 4,505 | $ | 4,496 | ||||
Supplies | 4,473 | 4,479 | ||||||
Prepaid insurance | 1,644 | 1,546 | ||||||
Prepaid advertising | 806 | 693 | ||||||
Other | 1,817 | 1,920 | ||||||
Total prepaid expenses and other current assets | $ | 13,245 | $ | 13,134 | ||||
Accrued expenses and other: | 2013 | 2012 | ||||||
Insurance reserves | $ | 10,474 | $ | 10,094 | ||||
Payroll and benefits | 9,661 | 9,289 | ||||||
Sales and use tax | 4,586 | 6,647 | ||||||
Deferred / contingent rent | 2,904 | 3,086 | ||||||
Real estate tax | 1,858 | 1,777 | ||||||
Giftcard liability | 1,473 | 1,325 | ||||||
Utilities | 1,358 | 821 | ||||||
Warehouse freight and fuel | 1,315 | 1,735 | ||||||
Personal property tax | 1,080 | 959 | ||||||
Franchise stores payable | 1,000 | 625 | ||||||
Repairs and maintenance | 862 | 344 | ||||||
Lease liability | 117 | 210 | ||||||
Other | 7,930 | 7,088 | ||||||
Total accrued expenses and other | $ | 44,618 | $ | 44,000 | ||||
Other noncurrent liabilities: | 2103 | 2012 | ||||||
Deferred income (see Note 1 - Vendor Rebates and Allowances) | $ | 13,084 | $ | 11,469 | ||||
Uncertain tax positions | 1,329 | 2,112 | ||||||
$ | 14,413 | $ | 13,581 | |||||
INDEBTEDNESS_Tables
INDEBTEDNESS (Tables) | 12 Months Ended | ||||||||||||||||||||||
Feb. 01, 2014 | |||||||||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||||||||
Schedule of Long-term Debt Instruments [Table Text Block] | ' | ||||||||||||||||||||||
The table below shows the long term debt related to these properties due for the next five years as of February 1, 2014: | |||||||||||||||||||||||
(in thousands) | 2014 | 2015 | 2016 | 2017 | 2018 | Thereafter | Total | ||||||||||||||||
Mortgage loans on land & buildings | $ | 1,640 | $ | 1,412 | $ | 623 | $ | 60 | $ | 70 | $ | 1,514 | $ | 5,319 | |||||||||
FAIR_VALUE_MEASUREMENTS_Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended | |||||||||||||
Feb. 01, 2014 | ||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments [Table Text Block] | ' | |||||||||||||
The table below details the fair value and carrying values for the revolving line of credit and mortgage loans as of the following years: | ||||||||||||||
February 1, 2014 | February 2, 2013 | |||||||||||||
(dollars in thousands) | Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||
Revolving line of credit | $ | - | $ | - | $ | 6,977 | $ | 6,977 | ||||||
Mortgage loans on land & buildings | 5,319 | 5,581 | 6,628 | 6,987 | ||||||||||
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | ||||||||||||
Feb. 01, 2014 | |||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | ' | ||||||||||||
The provision for income taxes consists of the following for the years ended February 1, 2014, February 2, 2013 and January 28, 2012: | |||||||||||||
(dollars in thousands) | 2013 | 2012 | 2011 | ||||||||||
Current | |||||||||||||
Federal | $ | 17,079 | $ | 11,298 | $ | 9,953 | |||||||
State | 1,489 | 834 | 915 | ||||||||||
18,568 | 12,132 | 10,868 | |||||||||||
Deferred | |||||||||||||
Federal | -5,060 | -3,865 | 6,886 | ||||||||||
State | -812 | 633 | -424 | ||||||||||
-5,872 | -3,232 | 6,462 | |||||||||||
$ | 12,696 | $ | 8,900 | $ | 17,330 | ||||||||
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | ' | ||||||||||||
The income tax effects of temporary differences that give rise to significant portions of the deferred income tax assets and deferred income tax liabilities as of year-end are presented below: | |||||||||||||
(dollars in thousands) | 2013 | 2012 | |||||||||||
Deferred income tax assets: | |||||||||||||
Accrual for incentive compensation | $ | 528 | $ | 241 | |||||||||
Allowance for doubtful accounts | 1,017 | 752 | |||||||||||
Insurance accruals | 2,545 | 2,320 | |||||||||||
Other accruals | 19 | 40 | |||||||||||
Net operating loss carryforwards | 4,498 | 4,803 | |||||||||||
Postretirement benefits other than pensions | - | - | |||||||||||
Deferred revenue | 755 | 657 | |||||||||||
Federal benefit on state reserves | 311 | 584 | |||||||||||
Amortization of intangibles | 13,076 | 10,821 | |||||||||||
Total deferred income tax assets | 22,749 | 20,218 | |||||||||||
Less: Valuation allowance | 2,051 | 1,995 | |||||||||||
Deferred income tax assets, net of valuation allowance | 20,698 | 18,223 | |||||||||||
Deferred income tax liabilities: | |||||||||||||
Postretirement benefits | -144 | -287 | |||||||||||
Property, plant and equipment | -15,767 | -18,996 | |||||||||||
Inventory valuation | -28,542 | -27,906 | |||||||||||
Prepaid expenses | -170 | - | |||||||||||
Total deferred income tax liabilities | -44,623 | -47,189 | |||||||||||
Net deferred income tax liabilities | $ | -23,925 | $ | -28,966 | |||||||||
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | ' | ||||||||||||
A reconciliation of the statutory federal income tax rate to the effective income tax rate is as follows: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Income tax provision at statutory rate | 35 | % | 35 | % | 35 | % | |||||||
Tax credits, principally jobs | -2.9 | -1 | -2.3 | ||||||||||
State income taxes, net of federal benefit | 2.2 | 4.7 | -0.2 | ||||||||||
Permanent differences | 0.4 | 0.3 | 0.5 | ||||||||||
Uncertain tax provisions | -1.3 | -12.7 | 0.3 | ||||||||||
Change in state valuation allowance | 0.2 | -2.2 | 0.8 | ||||||||||
Other | -0.8 | -1 | - | ||||||||||
Effective income tax rate | 32.8 | % | 23.1 | % | 34.1 | % | |||||||
Schedule of Unrecognized Tax Benefits Roll Forward [Table Text Block] | ' | ||||||||||||
A reconciliation of the beginning and ending amount of the unrecognized tax benefits is as follows: | |||||||||||||
(in millions) | 2013 | 2012 | 2011 | ||||||||||
Beginning balance | $ | 2.1 | $ | 9.6 | $ | 9.3 | |||||||
Additions for tax position during the current year | 0.2 | 0.1 | 1.1 | ||||||||||
Additions for tax positions of prior years | 0.1 | 0.1 | 0.3 | ||||||||||
Reductions for tax positions of prior years from lapse of statue | -1.1 | -0.9 | -1.1 | ||||||||||
Reductions for settlements of prior year tax positions | - | -6.8 | - | ||||||||||
Ending balance | $ | 1.3 | $ | 2.1 | $ | 9.6 | |||||||
LONGTERM_LEASES_Tables
LONG-TERM LEASES (Tables) | 12 Months Ended | ||||
Feb. 01, 2014 | |||||
Leases [Abstract] | ' | ||||
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | ' | ||||
Future minimum rental payments under all operating leases as of February 1, 2014 are as follows: | |||||
(in thousands) | Operating Leases | ||||
2014 | $ | 46,423 | |||
2015 | 39,293 | ||||
2016 | 32,782 | ||||
2017 | 25,354 | ||||
2018 | 15,962 | ||||
Thereafter | 50,060 | ||||
Total minimum lease payments | $ | 209,874 | |||
EQUITY_INCENTIVE_PLANS_Tables
EQUITY INCENTIVE PLANS (Tables) | 12 Months Ended | |||||||||||||
Feb. 01, 2014 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||
Schedule of Share-based Compensation, Activity [Table Text Block] | ' | |||||||||||||
The following represents total stock based compensation expense (a component of selling, general and administrative expenses) recognized in the consolidated financial statements (in thousands): | ||||||||||||||
(in thousands) | 2013 | 2012 | 2011 | |||||||||||
Stock option expense | $ | 610 | $ | 600 | $ | 455 | ||||||||
Restricted stock expense | 984 | 1,258 | 1,446 | |||||||||||
ESPP expense | 197 | 197 | 174 | |||||||||||
Total stock-based compensation | $ | 1,791 | $ | 2,055 | $ | 2,075 | ||||||||
Income tax benefit on stock-based compensation | $ | 473 | $ | 565 | $ | 573 | ||||||||
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | ' | |||||||||||||
The fair value of each option granted is estimated on the date of grant using the BSM with the following weighted average assumptions: | ||||||||||||||
Stock Options | 2013 | 2012 | 2011 | |||||||||||
Expected volatility | 32.1 | % | 39.7 | % | 41.2 | % | ||||||||
Risk-free interest rate | 1.2 | % | 0.5 | % | 1.8 | % | ||||||||
Expected option life (in years) | 4.73 | 4.16 | 5.13 | |||||||||||
Expected dividend yield | 1.7 | % | 1.3 | % | 0.9 | % | ||||||||
Weighted average fair value at grant date | $ | 3.81 | $ | 3.95 | $ | 4.35 | ||||||||
Employee Stock Purchase Plan | ||||||||||||||
Expected volatility | 22.7 | % | 33.2 | % | 27.6 | % | ||||||||
Risk-free interest rate | 0.2 | % | 0.1 | % | 0.3 | % | ||||||||
Expected option life (in years) | 0.63 | 0.63 | 0.63 | |||||||||||
Expected dividend yield | 1.1 | % | 1 | % | 0.9 | % | ||||||||
Weighted average fair value at grant date | $ | 3.02 | $ | 3.6 | $ | 3.32 | ||||||||
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | ' | |||||||||||||
The following table summarizes stock option activity from January 29, 2011 through February 1, 2014: | ||||||||||||||
Options | Weighted- | Weighted- | Aggregate | |||||||||||
Average | Averaged | Intrinsic | ||||||||||||
Exercise Price | Contractual | Value (000s) | ||||||||||||
Life (years) | ||||||||||||||
Outstanding at January 29, 2011 | 918,462 | $ | 12.15 | 3.2 | $ | 1,524 | ||||||||
Granted | 113,821 | 11.96 | ||||||||||||
Forfeited / Cancelled | -218,844 | 14.39 | ||||||||||||
Exercised | -18,063 | 12.12 | ||||||||||||
Outstanding at January 28, 2012 | 795,376 | $ | 11.52 | 3 | $ | 2,831 | ||||||||
Granted | 441,791 | 13.65 | ||||||||||||
Forfeited / Cancelled | -24,600 | 14.54 | ||||||||||||
Exercised | -66,912 | 13.14 | ||||||||||||
Outstanding at February 2, 2013 | 1,145,655 | $ | 12.18 | 3.2 | $ | 1,467 | ||||||||
Granted | 213,859 | 15.26 | ||||||||||||
Forfeited / Cancelled | -135,716 | 13.18 | ||||||||||||
Exercised | -81,369 | 12.26 | ||||||||||||
Outstanding at February 1, 2014 | 1,142,429 | $ | 12.63 | 3 | $ | 5,539 | ||||||||
Exercisable at February 1, 2014 | 458,056 | $ | 10.74 | 1.4 | $ | 3,089 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Fair Value [Table Text Block] | ' | |||||||||||||
Other information relative to option activity during 2013, 2012 and 2011 is as follows: | ||||||||||||||
(dollars in thousands) | 2013 | 2012 | 2011 | |||||||||||
Total fair value of stock options vested | $ | 353 | $ | 543 | $ | 642 | ||||||||
Total pretax intrinsic value of stock options exercised | $ | 266 | $ | 76 | $ | 42 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding and Exercisable [Table Text Block] | ' | |||||||||||||
The following table summarizes information about stock options outstanding at February 1, 2014: | ||||||||||||||
Options Outstanding | Options Exercisable | |||||||||||||
Range of Exercise Prices | Shares | Weighted- | Weighted- | Shares | Weighted- | |||||||||
Averaged | Average | Average | ||||||||||||
Contractual | Exercise Price | Exercise Price | ||||||||||||
Life (years) | ||||||||||||||
$ 8.66 - $12.75 | 455,769 | 1.4 | $ | 10.35 | 403,762 | $ | 10.36 | |||||||
$13.00 - $13.64 | 470,207 | 3.6 | $ | 13.57 | 34,924 | $ | 13.11 | |||||||
$13.72 - $18.03 | 216,453 | 5.2 | $ | 15.41 | 19,370 | $ | 14.3 | |||||||
1,142,429 | 458,056 | |||||||||||||
Schedule of Nonvested Restricted Stock Units Activity [Table Text Block] | ' | |||||||||||||
The following table summarizes restricted stock from January 29, 2011 through February 1, 2014: | ||||||||||||||
Shares | Weighted-Average | |||||||||||||
Grant Date | ||||||||||||||
Fair Value | ||||||||||||||
Non-vested Restricted Stock at January 29, 2011 | 472,927 | $ | 12.55 | |||||||||||
Granted | 396,830 | 12.59 | ||||||||||||
Forfeited / Cancelled | -91,375 | 12.12 | ||||||||||||
Exercised | -66,782 | 12.29 | ||||||||||||
Non-vested Restricted Stock at January 28, 2012 | 711,600 | $ | 12.56 | |||||||||||
Granted | 133,979 | 14.45 | ||||||||||||
Forfeited / Cancelled | -94,796 | 12.16 | ||||||||||||
Exercised | -129,774 | 12.26 | ||||||||||||
Non-vested Restricted Stock at February 2, 2013 | 621,009 | $ | 13.09 | |||||||||||
Granted | 113,943 | 14.72 | ||||||||||||
Forfeited / Cancelled | -125,686 | 13.22 | ||||||||||||
Exercised | -58,253 | 11.83 | ||||||||||||
Non-vested Restricted Stock at February 1, 2014 | 551,013 | $ | 13.53 | |||||||||||
OTHER_COMMITMENTS_AND_CONTINGE1
OTHER COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | ||||||||||
Feb. 01, 2014 | |||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||||||||
Schedule of Defined Benefit Plans Disclosures [Table Text Block] | ' | ||||||||||
The Company’s change in benefit obligation based upon an actuarial valuation is as follows: | |||||||||||
For the Years Ended | |||||||||||
(in thousands) | February 1, | February 2, | January 28, | ||||||||
2014 | 2013 | 2012 | |||||||||
Benefit obligation at beginning of year | $ | 440 | $ | 472 | $ | 492 | |||||
Service cost | 29 | 22 | 25 | ||||||||
Interest cost | 17 | 15 | 20 | ||||||||
Actuarial loss (gain) | 122 | -35 | -33 | ||||||||
Benefits paid | -49 | -33 | -32 | ||||||||
Benefit obligation at end of year | $ | 559 | $ | 440 | $ | 472 | |||||
Schedule of Amounts Recognized in Other Comprehensive Income (Loss) [Table Text Block] | ' | ||||||||||
The Company’s components of net accumulated other comprehensive income were as follows: | |||||||||||
For the Years Ended | |||||||||||
(in thousands) | February 1, | February 2, | January 28, | ||||||||
2014 | 2013 | 2012 | |||||||||
Accumulated other comprehensive income | $ | 1,045 | $ | 1,246 | $ | 1,306 | |||||
Deferred tax | -342 | -452 | -442 | ||||||||
Accumulated other comprehensive income, net | $ | 703 | $ | 794 | $ | 864 | |||||
Schedule of Effect of One-Percentage-Point Change in Assumed Health Care Cost Trend Rates [Table Text Block] | ' | ||||||||||
The below table illustrates a one-percentage-point increase or decrease in the healthcare cost trend rate assumed for postretirement benefits: | |||||||||||
(in thousands) | February 1, | February 2, | January 28, | ||||||||
2014 | 2013 | 2012 | |||||||||
Effect of health care trend rate | |||||||||||
1% increase effect on accumulated benefit obligations | $ | 43 | $ | 36 | 40 | ||||||
1% increase effect on periodic cost | 5 | 4 | 5 | ||||||||
1% decrease effect on accumulated benefit obligations | -39 | -33 | -36 | ||||||||
1% decrease effect on periodic cost | -5 | -4 | -5 | ||||||||
Schedule of Costs of Retirement Plans [Table Text Block] | ' | ||||||||||
The annual net postretirement cost is as follows: | |||||||||||
(in thousands) | February 1, | February 2, | January 28, | ||||||||
2014 | 2013 | 2012 | |||||||||
Service cost | $ | 29 | $ | 22 | $ | 25 | |||||
Interest cost | 17 | 15 | 20 | ||||||||
Amortization of prior service cost | -13 | -13 | -13 | ||||||||
Amortization of unrecognized prior service costs | -66 | -82 | -85 | ||||||||
Net periodic postretirement benefit cost | $ | -33 | $ | -58 | $ | -53 | |||||
Schedule of Changes in Accumulated Postemployment Benefit Obligations [Table Text Block] | ' | ||||||||||
The Company’s policy is to fund claims as incurred. Information about the expected cash flows for the postretirement medical plan follows: | |||||||||||
(in thousands) | Postretirement | ||||||||||
Medical Plan | |||||||||||
Expected Benefit Payments, net of retiree contributions | |||||||||||
2014 | $ | 51 | |||||||||
2015 | 50 | ||||||||||
2016 | 49 | ||||||||||
2017 | 48 | ||||||||||
2018 | 49 | ||||||||||
Next 5 years | 249 | ||||||||||
SALES_MIX_Tables
SALES MIX (Tables) | 12 Months Ended | |||||||||
Feb. 01, 2014 | ||||||||||
Segment Reporting [Abstract] | ' | |||||||||
Schedule of Segment Reporting Information, by Segment [Table Text Block] | ' | |||||||||
The Company’s sales mix by major category during the last 3 years was as follows: | ||||||||||
For the Years Ended | ||||||||||
February 1, | February 2, | January | ||||||||
2014 | 2013 | 28, 2012 | ||||||||
Pharmaceuticals | 37.7 | % | 36.3 | % | 34.9 | % | ||||
Household Goods | 21.8 | % | 22.6 | % | 23.3 | % | ||||
Food and Tobacco Products | 17.6 | % | 16.7 | % | 16.8 | % | ||||
Paper and Cleaning Supplies | 8.4 | % | 8.8 | % | 8.7 | % | ||||
Health and Beauty Aids | 7 | % | 7.5 | % | 7.4 | % | ||||
Apparel and Linens | 5.8 | % | 6.3 | % | 6.9 | % | ||||
Sales to Franchised Fred's Stores | 1.7 | % | 1.8 | % | 2 | % | ||||
Total Sales Mix | 100 | % | 100 | % | 100 | % | ||||
EXIT_AND_DISPOSAL_ACTIVITY_Tab
EXIT AND DISPOSAL ACTIVITY (Tables) | 12 Months Ended | |||||||||
Feb. 01, 2014 | ||||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | |||||||||
Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures [Table Text Block] | ' | |||||||||
The following table illustrates the exit and disposal activity related to the store closures discussed in the previous paragraphs (in millions): | ||||||||||
(in millions) | Beginning | Additions | Utilized | Ending | ||||||
Balance | FY13 | FY13 | Balance | |||||||
February 2, | February 1, | |||||||||
2013 | 2014 | |||||||||
Lease contract termination liability | 0.2 | - | -0.1 | 0.1 | ||||||
QUARTERLY_FINANCIAL_DATA_UNAUD1
QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables) | 12 Months Ended | |||||||||||||
Feb. 01, 2014 | ||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | |||||||||||||
Schedule of Quarterly Financial Information [Table Text Block] | ' | |||||||||||||
The Company’s unaudited quarterly financial information for the fiscal years ended February 1, 2014 and February 2, 2013 is reported below: | ||||||||||||||
(in thousands, except per share data) | First Quarter | Second | Third | Fourth | ||||||||||
Quarter | Quarter | Quarter | ||||||||||||
Year ended February 1, 2014 | ||||||||||||||
Net sales | $ | 501,495 | $ | 482,176 | $ | 460,542 | $ | 495,033 | ||||||
Gross profit | 151,019 | 135,985 | 140,237 | 133,600 | ||||||||||
Net income | 11,411 | 3,330 | 7,308 | 3,966 | ||||||||||
Net income per share | ||||||||||||||
Basic | $ | 0.31 | $ | 0.09 | $ | 0.2 | $ | 0.11 | ||||||
Diluted | $ | 0.31 | $ | 0.09 | $ | 0.2 | $ | 0.11 | ||||||
Cash dividends paid per common share | $ | 0.06 | $ | 0.06 | $ | 0.06 | $ | 0.06 | ||||||
Year ended February 2, 2013 | ||||||||||||||
Net sales | $ | 500,505 | $ | 470,816 | $ | 450,574 | $ | 533,380 | ||||||
Gross profit | 147,842 | 131,758 | 138,133 | 148,599 | ||||||||||
Net income | 10,458 | 6,054 | 6,561 | 6,556 | ||||||||||
Net income per share | ||||||||||||||
Basic | $ | 0.28 | $ | 0.17 | $ | 0.18 | $ | 0.18 | ||||||
Diluted | $ | 0.28 | $ | 0.17 | $ | 0.18 | $ | 0.18 | ||||||
Cash dividends paid per common share 1 | $ | 0.06 | $ | 0.06 | $ | 0.06 | $ | 0.25 | ||||||
1. The $0.25 cash dividend per share paid in the fourth quarter of 2012 consists of a one-time special dividend of $0.19 and the $0.06 regular quarterly dividend. | ||||||||||||||
DESCRIPTION_OF_BUSINESS_AND_SU3
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 12 Months Ended |
Feb. 01, 2014 | |
Building and Building Improvements [Member] | Maximum [Member] | ' |
Property, Plant and Equipment, Useful Life | '31 years 6 months |
Building and Building Improvements [Member] | Minimum [Member] | ' |
Property, Plant and Equipment, Useful Life | '8 years |
Furniture, Fixtures and Equipment [Member] | Maximum [Member] | ' |
Property, Plant and Equipment, Useful Life | '10 years |
Furniture, Fixtures and Equipment [Member] | Minimum [Member] | ' |
Property, Plant and Equipment, Useful Life | '3 years |
Leasehold Improvements [Member] | Maximum [Member] | ' |
Property, Plant and Equipment, Useful Life | '10 years |
Leasehold Improvements [Member] | Minimum [Member] | ' |
Property, Plant and Equipment, Useful Life | '3 years |
Automobiles and Vehicles [Member] | Maximum [Member] | ' |
Property, Plant and Equipment, Useful Life | '10 years |
Automobiles and Vehicles [Member] | Minimum [Member] | ' |
Property, Plant and Equipment, Useful Life | '3 years |
Airplane [Member] | ' |
Property, Plant and Equipment, Useful Life | '9 years |
DESCRIPTION_OF_BUSINESS_AND_SU4
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textual) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||
Feb. 01, 2014 | Nov. 02, 2013 | Aug. 03, 2013 | 4-May-13 | Feb. 02, 2013 | Oct. 27, 2012 | Jul. 28, 2012 | Apr. 28, 2012 | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 | Jan. 29, 2011 | |
Inventory, Net | $361,993,000 | ' | ' | ' | $353,266,000 | ' | ' | ' | $361,993,000 | $353,266,000 | ' | ' |
Increase (Decrease) in LIFO Reserve | ' | ' | ' | ' | ' | ' | ' | ' | 4,500,000 | 3,900,000 | ' | ' |
Amortization of Leased Asset | ' | ' | ' | ' | ' | ' | ' | ' | ' | 34,000 | ' | ' |
Operating Leases, Rent Expense | ' | ' | ' | ' | ' | ' | ' | ' | 800,000 | 700,000 | ' | ' |
Franchise Revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,600,000 | 1,700,000 | 1,800,000 |
Advertising Expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | 22,800,000 | 24,000,000 | 21,900,000 |
Reduction of Advertising Expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,800,000 | 2,400,000 | 2,400,000 |
Intangible Assets, Net (Excluding Goodwill) | 54,580,000 | ' | ' | ' | 41,873,000 | ' | ' | ' | 54,580,000 | 41,873,000 | ' | ' |
Finite-Lived Intangible Assets, Accumulated Amortization | 54,300,000 | ' | ' | ' | 42,200,000 | ' | ' | ' | 54,300,000 | 42,200,000 | ' | ' |
Amortization of Intangible Assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12,100,000 | 10,500,000 | 6,900,000 |
Finite-Lived Intangible Assets, Amortization Expense, Next Twelve Months | 9,800,000 | ' | ' | ' | ' | ' | ' | ' | 9,800,000 | ' | ' | ' |
Finite-Lived Intangible Assets, Amortization Expense, Year Two | 9,700,000 | ' | ' | ' | ' | ' | ' | ' | 9,700,000 | ' | ' | ' |
Finite-Lived Intangible Assets, Amortization Expense, Year Three | 9,500,000 | ' | ' | ' | ' | ' | ' | ' | 9,500,000 | ' | ' | ' |
Finite-Lived Intangible Assets, Amortization Expense, Year Four | 8,700,000 | ' | ' | ' | ' | ' | ' | ' | 8,700,000 | ' | ' | ' |
Finite-Lived Intangible Assets, Amortization Expense, Year Five | 7,500,000 | ' | ' | ' | ' | ' | ' | ' | 7,500,000 | ' | ' | ' |
Finite Lived Intangible Assets Amortization Expense, Year Six | 5,100,000 | ' | ' | ' | ' | ' | ' | ' | 5,100,000 | ' | ' | ' |
Finite Lived Intangible Assets Amortization Expense, Year Seven | 2,800,000 | ' | ' | ' | ' | ' | ' | ' | 2,800,000 | ' | ' | ' |
Workers Compensation Stop Loss Limit | ' | ' | ' | ' | ' | ' | ' | ' | 500,000 | ' | ' | ' |
Increase (Decrease) in Self Insurance Reserve | ' | ' | ' | ' | ' | ' | ' | ' | 41,900,000 | 41,500,000 | ' | ' |
Self Insurance Reserve | 10,500,000 | ' | ' | ' | 10,100,000 | ' | ' | ' | 10,500,000 | 10,100,000 | ' | ' |
Earnings Per Share, Diluted | $0.11 | $0.20 | $0.09 | $0.31 | $0.18 | $0.18 | $0.17 | $0.28 | $0.71 | $0.81 | $0.87 | ' |
Impaired Long-Lived Assets Held and Used, Asset Description | ' | ' | ' | ' | ' | ' | ' | ' | 'Impairment or Disposal of Long-Lived Assets, we review for impairment all stores open at least 3 years or remodeled for more than two years. Impairment results when the carrying value of the assets exceeds the undiscounted future cash flows over the life of the lease, or 10 years for owned stores. | ' | ' | ' |
Other Intangible Assets [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating Expenses | 1,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Earnings Per Share, Diluted | $0.03 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Customer Lists [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Finite-Lived Intangible Asset, Useful Life | ' | ' | ' | ' | ' | ' | ' | ' | '7 years | ' | ' | ' |
Customer Lists [Member] | Minimum [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Finite-Lived Intangible Asset, Useful Life | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Customer Lists [Member] | Maximum [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Finite-Lived Intangible Asset, Useful Life | '7 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Pharmacy Inventory [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Inventory, Net | 40,400,000 | ' | ' | ' | 33,800,000 | ' | ' | ' | 40,400,000 | 33,800,000 | ' | ' |
LIFO Inventory Amount | 35,200,000 | ' | ' | ' | 30,700,000 | ' | ' | ' | 35,200,000 | 30,700,000 | ' | ' |
Merchandise Inventory [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Inventory, Net | 21,600,000 | ' | ' | ' | 21,600,000 | ' | ' | ' | 21,600,000 | 21,600,000 | ' | ' |
Inventory Valuation Reserves | 1,700,000 | ' | ' | ' | ' | ' | ' | ' | 1,700,000 | ' | ' | ' |
Catastrophic Claims [Member] | Maximum [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase (Decrease) in Insurance Liabilities | ' | ' | ' | ' | ' | ' | ' | ' | 350,000 | ' | ' | ' |
Medical Insurance [Member] | Minimum [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase (Decrease) in Insurance Liabilities | ' | ' | ' | ' | ' | ' | ' | ' | $175,000 | ' | ' | ' |
DETAIL_OF_CERTAIN_BALANCE_SHEE2
DETAIL OF CERTAIN BALANCE SHEET ACCOUNTS (Details) (USD $) | Feb. 01, 2014 | Feb. 02, 2013 |
In Thousands, unless otherwise specified | ||
Property and equipment, at cost: | ' | ' |
Property, Plant and Equipment | $471,716 | $463,930 |
Less: Accumulated depreciation and amortization | -328,686 | -315,175 |
Property Plant and Equipment Net | 143,030 | 148,755 |
Construction in Progress, Gross | 1,729 | 1,035 |
Land | 8,604 | 8,604 |
Total Property and equipment, at depreciated cost | 153,363 | 158,394 |
Other non-trade receivables: | ' | ' |
Vendor receivables | 30,431 | 26,728 |
Income tax receivable | 3,159 | 2,217 |
Franchise stores receivable | 1,537 | 1,157 |
Insurance claims receivable | 0 | 474 |
Coupon receivable | 400 | 457 |
Other | 1,963 | 2,240 |
Total other non-trade receivable | 37,490 | 33,273 |
Prepaid expenses and other current assets: | ' | ' |
Prepaid rent | 4,505 | 4,496 |
Supplies | 4,473 | 4,479 |
Prepaid insurance | 1,644 | 1,546 |
Prepaid advertising | 806 | 693 |
Other | 1,817 | 1,920 |
Total prepaid expenses and other current assets | 13,245 | 13,134 |
Accrued expenses and other: | ' | ' |
Insurance reserves | 10,474 | 10,094 |
Payroll and benefits | 9,661 | 9,289 |
Sales and use tax | 4,586 | 6,647 |
Deferred / contingent rent | 2,904 | 3,086 |
Real estate tax | 1,858 | 1,777 |
Giftcard liability | 1,473 | 1,325 |
Utilities | 1,358 | 821 |
Warehouse freight and fuel | 1,315 | 1,735 |
Personal property tax | 1,080 | 959 |
Franchise stores payable | 1,000 | 625 |
Repairs and maintenance | 862 | 344 |
Lease liability | 117 | 210 |
Other | 7,930 | 7,088 |
Total accrued expenses and other | 44,618 | 44,000 |
Other noncurrent liabilities: | ' | ' |
Deferred income (see Note 1 - Vendor Rebates and Allowances) | 13,084 | 11,469 |
Uncertain tax positions | 1,329 | 2,112 |
Other Liabilities, Noncurrent | 14,413 | 13,581 |
Building Improvements [Member] | ' | ' |
Property and equipment, at cost: | ' | ' |
Property, Plant and Equipment | 114,688 | 113,164 |
Leasehold Improvements [Member] | ' | ' |
Property and equipment, at cost: | ' | ' |
Property, Plant and Equipment | 78,101 | 74,552 |
Automobiles and Vehicles [Member] | ' | ' |
Property and equipment, at cost: | ' | ' |
Property, Plant and Equipment | 5,459 | 5,601 |
Airplane [Member] | ' | ' |
Property and equipment, at cost: | ' | ' |
Property, Plant and Equipment | 4,697 | 4,697 |
Furniture and Fixtures [Member] | ' | ' |
Property and equipment, at cost: | ' | ' |
Property, Plant and Equipment | $268,771 | $265,916 |
DETAIL_OF_CERTAIN_BALANCE_SHEE3
DETAIL OF CERTAIN BALANCE SHEET ACCOUNTS (Details Textual) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Feb. 02, 2013 | Jan. 28, 2012 | Jan. 29, 2011 |
DETAIL OF CERTAIN BALANCE SHEET ACCOUNTS [Line Items] | ' | ' | ' |
Depreciation | $28.90 | $29 | $27.30 |
INDEBTEDNESS_Details
INDEBTEDNESS (Details) (USD $) | Feb. 01, 2014 | Feb. 02, 2013 |
In Thousands, unless otherwise specified | ||
Maturities of Long Term Debt [Line Items] | ' | ' |
2014 | $1,640 | ' |
2015 | 1,412 | ' |
2016 | 623 | ' |
2017 | 60 | ' |
2018 | 70 | ' |
Thereafter | 1,514 | ' |
Total | $5,319 | $6,628 |
INDEBTEDNESS_Details_Textual
INDEBTEDNESS (Details Textual) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Feb. 01, 2014 | Dec. 31, 2007 | Feb. 02, 2013 |
INDEBTEDNESS [Line Items] | ' | ' | ' |
Long-term Line of Credit | $5.60 | ' | $7.40 |
Purchase Of Lease Property For Cash | 7.5 | ' | ' |
Purchase Of Lease Property For Mortgage Bond | 3.5 | ' | ' |
Bonds Purchased Percentage | 100.00% | ' | ' |
Offset Value For Investment In Bonds | 34.6 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Minimum | 6.65% | 6.31% | ' |
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Maximum | 7.40% | 7.40% | ' |
Revolving Credit Facility [Member] | ' | ' | ' |
INDEBTEDNESS [Line Items] | ' | ' | ' |
Line of Credit Facility, Maximum Borrowing Capacity | 20 | ' | ' |
Line of Credit Facility, Interest Rate Description | '1.00% - 1.625% plus LIBOR | ' | ' |
Debt, Weighted Average Interest Rate | ' | ' | 1.33% |
Line of Credit Facility, Expiration Date | 25-Jan-16 | ' | ' |
Revolving Credit Facility [Member] | Minimum [Member] | ' | ' | ' |
INDEBTEDNESS [Line Items] | ' | ' | ' |
Long-term Line of Credit | 50 | ' | ' |
Current Portion Of Line Of Credit [Member] | ' | ' | ' |
INDEBTEDNESS [Line Items] | ' | ' | ' |
Line of Credit Facility, Interest Rate Description | 'Currently, the Companys rates are 137.5 basis points over LIBOR for borrowings | ' | ' |
Long-term Line of Credit | ' | ' | $6.90 |
Unused Portion Of Line Of Credit [Member] | ' | ' | ' |
INDEBTEDNESS [Line Items] | ' | ' | ' |
Line of Credit Facility, Interest Rate Description | '25.0 basis points over LIBOR for the unused portion of the credit line | ' | ' |
FAIR_VALUE_MEASUREMENTS_Detail
FAIR VALUE MEASUREMENTS (Details) (USD $) | Feb. 01, 2014 | Feb. 02, 2013 |
In Thousands, unless otherwise specified | ||
Mortgage loans on land & buildings, Carrying Value | $5,319 | $6,628 |
Mortgage loans on land & buildings, Fair Value | 5,581 | 6,987 |
Revolving Credit Facility [Member] | ' | ' |
Revolving line of credit, Carrying value | 0 | 6,977 |
Revolving line of credit, Fair value | $0 | $6,977 |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||
In Thousands, unless otherwise specified | Feb. 01, 2014 | Nov. 02, 2013 | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 |
Current | ' | ' | ' | ' | ' |
Federal | ' | ' | $17,079 | $11,298 | $9,953 |
State | ' | ' | 1,489 | 834 | 915 |
Current Income Tax Expense (Benefit) | ' | ' | 18,568 | 12,132 | 10,868 |
Deferred | ' | ' | ' | ' | ' |
Federal | ' | ' | -5,060 | -3,865 | 6,886 |
State | ' | ' | -812 | 633 | -424 |
Deferred Income Tax Expense (Benefit) | ' | ' | -5,872 | -3,232 | 6,462 |
Income Tax Expense (Benefit) | $1,100 | $1,100 | $12,696 | $8,900 | $17,330 |
INCOME_TAXES_Details_1
INCOME TAXES (Details 1) (USD $) | Feb. 01, 2014 | Feb. 02, 2013 |
In Thousands, unless otherwise specified | ||
Deferred income tax assets: | ' | ' |
Accrual for incentive compensation | $528 | $241 |
Allowance for doubtful accounts | 1,017 | 752 |
Insurance accruals | 2,545 | 2,320 |
Other accruals | 19 | 40 |
Net operating loss carryforwards | 4,498 | 4,803 |
Postretirement benefits other than pensions | 0 | 0 |
Deferred revenue | 755 | 657 |
Federal benefit on state reserves | 311 | 584 |
Amortization of intangibles | 13,076 | 10,821 |
Total deferred income tax assets | 22,749 | 20,218 |
Less: Valuation allowance | 2,051 | 1,995 |
Deferred income tax assets, net of valuation allowance | 20,698 | 18,223 |
Deferred income tax liabilities: | ' | ' |
Postretirement benefits | -144 | -287 |
Property, plant and equipment | -15,767 | -18,996 |
Inventory valuation | -28,542 | -27,906 |
Prepaid expenses | -170 | 0 |
Total deferred income tax liabilities | -44,623 | -47,189 |
Net deferred income tax liabilities | ($23,925) | ($28,966) |
INCOME_TAXES_Details_2
INCOME TAXES (Details 2) | 12 Months Ended | ||
Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 | |
Income tax provision at statutory rate | 35.00% | 35.00% | 35.00% |
Tax credits, principally jobs | -2.90% | -1.00% | -2.30% |
State income taxes, net of federal benefit | 2.20% | 4.70% | -0.20% |
Permanent differences | 0.40% | 0.30% | 0.50% |
Uncertain tax provisions | -1.30% | -12.70% | 0.30% |
Change in state valuation allowance | 0.20% | -2.20% | 0.80% |
Other | -0.80% | -1.00% | 0.00% |
Effective income tax rate | 32.80% | 23.10% | 34.10% |
INCOME_TAXES_Details_3
INCOME TAXES (Details 3) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 |
Beginning balance | $2.10 | $9.60 | $9.30 |
Additions for tax position during the current year | 0.2 | 0.1 | 1.1 |
Additions for tax positions of prior years | 0.1 | 0.1 | 0.3 |
Reductions for tax positions of prior years from lapse of statue | -1.1 | -0.9 | -1.1 |
Reductions for settlements of prior year tax positions | 0 | -6.8 | 0 |
Ending balance | $1.30 | $2.10 | $9.60 |
INCOME_TAXES_Details_Textual
INCOME TAXES (Details Textual) (USD $) | 3 Months Ended | 12 Months Ended | |||
Feb. 01, 2014 | Nov. 02, 2013 | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 | |
Income Tax Disclosure [Abstract] | ' | ' | ' | ' | ' |
Valuation Allowance, Deferred Tax Asset, Change in Amount | ' | ' | $100,000 | $400,000 | ' |
Income Tax Expense (Benefit) | 1,100,000 | 1,100,000 | 12,696,000 | 8,900,000 | 17,330,000 |
Unrecognized Tax Benefits, Increase Resulting from Prior Period Tax Positions | ' | ' | 100,000 | 100,000 | 300,000 |
Unrecognized Tax Benefits, Interest on Income Taxes Accrued | 200,000 | ' | 200,000 | 400,000 | ' |
Unrecognized Tax Benefits, Income Tax Penalties Accrued | 100,000 | ' | 100,000 | 100,000 | ' |
Net Operating Loss Carryforwards, Expiration Period | ' | ' | '2014 through 2034 | ' | ' |
State and Local Jurisdiction [Member] | ' | ' | ' | ' | ' |
Income Tax Disclosure [Abstract] | ' | ' | ' | ' | ' |
Operating Loss Carryforwards | 102,500,000 | ' | 102,500,000 | ' | ' |
Unrecognized Tax Benefits, Increase Resulting from Prior Period Tax Positions | ' | ' | $200,000 | $300,000 | ' |
LONGTERM_LEASES_Details
LONG-TERM LEASES (Details) (USD $) | Feb. 01, 2014 |
In Thousands, unless otherwise specified | |
Operating Leased Assets [Line Items] | ' |
2014 | $46,423 |
2015 | 39,293 |
2016 | 32,782 |
2017 | 25,354 |
2018 | 15,962 |
Thereafter | 50,060 |
Total minimum lease payments | $209,874 |
LONGTERM_LEASES_Details_Textua
LONG-TERM LEASES (Details Textual) (USD $) | 12 Months Ended | |||
Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 | Jan. 29, 2011 | |
Operating Leased Assets [Line Items] | ' | ' | ' | ' |
Operating Leases, Rent Expense, Net | ' | $60,000,000 | $57,200,000 | $53,200,000 |
Operating Leases, Rent Expense, Contingent Rentals | ' | 800,000 | 700,000 | 1,000,000 |
Capital Leased Assets, Gross | 5,100,000 | 5,100,000 | ' | ' |
Capital Leases, Lessee Balance Sheet, Assets by Major Class, Accumulated Depreciation | 5,111,000 | 5,077,000 | ' | ' |
Capital Leases, Income Statement, Amortization Expense | 34,000 | 34,000 | ' | ' |
Capital Leases, Contingent Rental Payments Due | $301,000 | $326,100 | $451,200 | ' |
Atlantic Retail Investors Llc [Member] | ' | ' | ' | ' |
Operating Leased Assets [Line Items] | ' | ' | ' | ' |
Number of Properties Subject to Ground Leases | 3 | ' | ' | ' |
SHAREHOLDERS_EQUITY_Details_Te
SHAREHOLDERS' EQUITY (Details Textual) | 12 Months Ended | ||||
Feb. 01, 2014 | Feb. 02, 2013 | Feb. 16, 2012 | Jan. 28, 2012 | Aug. 27, 2007 | |
Common Stock Outstanding Roll Forward [Line Items] | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Plan Modification, Description and Terms | 'Each Right represents the right to purchase one-hundredth of a preferred share of stock at a preset price to be exercised when any one individual, firm, corporation or other entity acquires 15% or more of the Companys common stock. | ' | ' | ' | ' |
Stock Repurchase Program, Number of Shares Authorized to be Repurchased | ' | ' | ' | ' | 4,000,000 |
Stock Repurchase Program, Remaining Number of Shares Authorized to be Repurchased | ' | ' | 3,600,000 | ' | ' |
Maximum Number of Shares That May Yet Be Purchased Under the Plans or Program | ' | ' | ' | 90,000 | ' |
Stock Repurchase Program Number Of Shares Available For Repurchase | 3,000,000 | 3,000,000 | ' | ' | ' |
EQUITY_INCENTIVE_PLANS_Details
EQUITY INCENTIVE PLANS (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Share-based Compensation | $1,791 | $2,055 | $2,075 |
Income tax benefit on stock-based compensation | 473 | 565 | 573 |
Employee Stock Purchase Plan (ESPP) [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Share-based Compensation | 197 | 197 | 174 |
Restricted Stock Expense [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Share-based Compensation | 984 | 1,258 | 1,446 |
Stock Option Expense [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Share-based Compensation | $610 | $600 | $455 |
EQUITY_INCENTIVE_PLANS_Details1
EQUITY INCENTIVE PLANS (Details 1) (USD $) | 12 Months Ended | ||
Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 | |
Stock Option [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | ' | ' | ' |
Expected volatility | 32.10% | 39.70% | 41.20% |
Risk-free interest rate | 1.20% | 0.50% | 1.80% |
Expected option life (in years) | '4 years 8 months 23 days | '4 years 1 month 28 days | '5 years 1 month 17 days |
Expected dividend yield | 1.70% | 1.30% | 0.90% |
Weighted average fair value at grant date | $3.81 | $3.95 | $4.35 |
Employee Stock Purchase Plan (ESPP) [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | ' | ' | ' |
Expected volatility | 22.70% | 33.20% | 27.60% |
Risk-free interest rate | 0.20% | 0.10% | 0.30% |
Expected option life (in years) | '7 months 17 days | '7 months 17 days | '7 months 17 days |
Expected dividend yield | 1.10% | 1.00% | 0.90% |
Weighted average fair value at grant date | $3.02 | $3.60 | $3.32 |
EQUITY_INCENTIVE_PLANS_Details2
EQUITY INCENTIVE PLANS (Details 2) (USD $) | 12 Months Ended | |||
Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 | Jan. 29, 2011 | |
Options, Outstanding Beginning Period (in shares) | 1,145,655 | 795,376 | 918,462 | ' |
Options, Granted (in shares) | 213,859 | 441,791 | 113,821 | ' |
Options, Forfeited / Cancelled (in shares) | -135,716 | -24,600 | -218,844 | ' |
Options, Exercised (in shares) | -81,369 | -66,912 | -18,063 | ' |
Options, Outstanding Ending Period (in shares) | 1,142,429 | 1,145,655 | 795,376 | 918,462 |
Options, Exercisable (in shares) | 458,056 | ' | ' | ' |
Weighted Average Exercise Price, Outstanding Beginning Period (in dollars per share) | $12.18 | $11.52 | $12.15 | ' |
Weighted Average Exercise Price, Granted (in dollars per share) | $15.26 | $13.65 | $11.96 | ' |
Weighted Average Exercise Price, Forfeited / Cancelled (in dollars per share) | $13.18 | $14.54 | $14.39 | ' |
Weighted Average Exercise Price, Exercised (in dollars per share) | $12.26 | $13.14 | $12.12 | ' |
Weighted Average Exercise Price, Outstanding Ending Period (in dollars per share) | $12.63 | $12.18 | $11.52 | $12.15 |
Weighted Average Exercise Price, Exercisable (in dollars per share) | $10.74 | ' | ' | ' |
Weighted Average Remaining Contractual Life (Years), Outstanding | '3 years | '3 years 2 months 12 days | '3 years | '3 years 2 months 12 days |
Weighted Average Remaining Contractual Life (Years), Exercisable | '1 year 4 months 24 days | ' | ' | ' |
Aggregate Intrinsic Value, Outstanding Beginning Period (in dollars) | $1,467 | $2,831 | $1,524 | ' |
Aggregate Intrinsic Value, Outstanding Ending Period (in dollars) | 5,539 | 1,467 | 2,831 | 1,524 |
Aggregate Intrinsic Value, Exercisable (in dollars) | $3,089 | ' | ' | ' |
EQUITY_INCENTIVE_PLANS_Details3
EQUITY INCENTIVE PLANS (Details 3) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 |
Share Based Compensation Arrangement By Share Based Payment Award Options [Line Items] | ' | ' | ' |
Total fair value of stock options vested | $353 | $543 | $642 |
Total pretax intrinsic value of stock options exercised | $266 | $76 | $42 |
EQUITY_INCENTIVE_PLANS_Details4
EQUITY INCENTIVE PLANS (Details 4) (USD $) | 12 Months Ended |
Feb. 01, 2014 | |
Share Based Compensation Stock Options Outstanding And Exercisable [Line Items] | ' |
Options outstanding, Shares | 1,142,429 |
Options Exercisable, Shares | 458,056 |
Stock Options Range Of Exercis Price 1 [Member] | ' |
Share Based Compensation Stock Options Outstanding And Exercisable [Line Items] | ' |
Options outstanding, Exercise Price Minimum | $8.66 |
Options outstanding, Exercise Price Maximum | $12.75 |
Options outstanding, Shares | 455,769 |
Options Outstanding, Weighted Average Remaining Contractual Life (years) | '1 year 4 months 24 days |
Options Outstanding, Weighted Average Exercise Price | $10.35 |
Options Exercisable, Shares | 403,762 |
Options Exercisable, Weighted Average Exercise Price | $10.36 |
Stock Options Range Of Exercise Prices 2 [Member] | ' |
Share Based Compensation Stock Options Outstanding And Exercisable [Line Items] | ' |
Options outstanding, Exercise Price Minimum | $13 |
Options outstanding, Exercise Price Maximum | $13.64 |
Options outstanding, Shares | 470,207 |
Options Outstanding, Weighted Average Remaining Contractual Life (years) | '3 years 7 months 6 days |
Options Outstanding, Weighted Average Exercise Price | $13.57 |
Options Exercisable, Shares | 34,924 |
Options Exercisable, Weighted Average Exercise Price | $13.11 |
Stock Options Range Of Exercise Prices 3 [Member] | ' |
Share Based Compensation Stock Options Outstanding And Exercisable [Line Items] | ' |
Options outstanding, Exercise Price Minimum | $13.72 |
Options outstanding, Exercise Price Maximum | $18.03 |
Options outstanding, Shares | 216,453 |
Options Outstanding, Weighted Average Remaining Contractual Life (years) | '5 years 2 months 12 days |
Options Outstanding, Weighted Average Exercise Price | $15.41 |
Options Exercisable, Shares | 19,370 |
Options Exercisable, Weighted Average Exercise Price | $14.30 |
EQUITY_INCENTIVE_PLANS_Details5
EQUITY INCENTIVE PLANS (Details 5) (Restricted Stock [Member], USD $) | 12 Months Ended | ||
Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 | |
Restricted Stock [Member] | ' | ' | ' |
Options, Non-vested Restricted Stock Beginning Period (in shares) | 621,009 | 711,600 | 472,927 |
Options, Granted (in shares) | 113,943 | 133,979 | 396,830 |
Options, Forfeited / Cancelled (in shares) | -125,686 | -94,796 | -91,375 |
Options, Exercised (in shares) | -58,253 | -129,774 | -66,782 |
Options, Non-vested Restricted Stock (in shares) Ending Period | 551,013 | 621,009 | 711,600 |
Weighted Average Grant Date Fair Value, Non-vested Restricted Stock (in dollars per share) Beginning Period | $13.09 | $12.56 | $12.55 |
Weighted Average Grant Date Fair Value, Granted (in dollars per share) | $14.72 | $14.45 | $12.59 |
Weighted Average Grant Date Fair Value, Forfeited / Cancelled (in dollars per share) | $13.22 | $12.16 | $12.12 |
Weighted Average Grant Date Fair Value, Exercised (in dollars per share) | $11.83 | $12.26 | $12.29 |
Weighted Average Grant Date Fair Value, Non-vested Restricted Stock (in dollars per share) Ending Period | $13.53 | $13.09 | $12.56 |
EQUITY_INCENTIVE_PLANS_Details6
EQUITY INCENTIVE PLANS (Details Textual) (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 |
Incentive Stock Option Plan [Member] | ' | ' | ' |
Share-Based Compensation Arrangement By Share-Based Payment Award, Number Of Shares Authorized | 3,000,000 | 2,400,000 | ' |
Share-Based Compensation Arrangement By Share-Based Payment Award, Number Of Shares Available For Grant | 1,273,395 | 1,343,795 | ' |
Exercise Price For Stock Options Issued Of Fair Value | 100.00% | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized | 600,000 | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Terms of Award | 'expire five to eight years | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Date | 18-Mar-22 | ' | ' |
Employee Stock Purchase Plan (ESPP) [Member] | ' | ' | ' |
Employee Stock Purchase Plan Eligible Employees To Purchase Shares, Description | 'The 2004 Employee Stock Purchase Plan ("ESSP") (the 2004 Plan), which was approved by Fred's stockholders, permits eligible employees to purchase shares of our common stock through payroll deductions at the lower of 85% of the fair market value of the stock at the time of grant or 85% of the market price at the time of exercise. | ' | ' |
Share-Based Compensation Arrangement By Share-Based Payment Award, Shares Issued In Period | 60,912 | 54,830 | 52,526 |
Share-Based Compensation Arrangement By Share-Based Payment Award, Number Of Shares Authorized | 1,410,928 | ' | ' |
Share-Based Compensation Arrangement By Share-Based Payment Award, Number Of Shares Available For Grant | 858,565 | ' | ' |
Stock Option [Member] | ' | ' | ' |
Employee Service Share-Based Compensation, Nonvested Awards, Total Compensation Cost Not Yet Recognized, Stock Options | 1.5 | ' | ' |
Employee Service Share-Based Compensation, Nonvested Awards, Total Compensation Cost Not Yet Recognized, Period For Recognition | '3 years 1 month 6 days | ' | ' |
Restricted Stock [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Aggregate Intrinsic Value, Outstanding | 9.6 | ' | ' |
Share-Based Compensation Arrangement By Share-Based Payment Award, Equity Instruments Other Than Options, Outstanding, Weighted Average Remaining Contractual Terms | '5 years 2 months 12 days | ' | ' |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options | 4.1 | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award, Equity Instruments Other Than Options, Forfeited Weighted Average Remaining Contractual Term | '6 years 2 months 12 days | ' | ' |
Share-Based Compensation Arrangement By Share-Based Payment Award, Equity Instruments Other Than Options, Vested In Period, Total Fair Value | 0.7 | 1.5 | 0.9 |
NET_INCOME_PER_SHARE_Details_T
NET INCOME PER SHARE (Details Textual) | 12 Months Ended | ||
Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2,500 | 482,588 | 2,500 |
OTHER_COMMITMENTS_AND_CONTINGE2
OTHER COMMITMENTS AND CONTINGENCIES (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 |
Loss Contingencies [Line Items] | ' | ' | ' |
Benefit obligation at beginning of year | $440 | $472 | $492 |
Service cost | 29 | 22 | 25 |
Interest cost | 17 | 15 | 20 |
Actuarial loss (gain) | 122 | -35 | -33 |
Benefits paid | -49 | -33 | -32 |
Benefit obligation at end of year | $559 | $440 | $472 |
OTHER_COMMITMENTS_AND_CONTINGE3
OTHER COMMITMENTS AND CONTINGENCIES (Details 1) (USD $) | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 |
In Thousands, unless otherwise specified | |||
Loss Contingencies [Line Items] | ' | ' | ' |
Accumulated other comprehensive income | $1,045 | $1,246 | $1,306 |
Deferred tax | -342 | -452 | -442 |
Accumulated other comprehensive income, net | $703 | $794 | $864 |
OTHER_COMMITMENTS_AND_CONTINGE4
OTHER COMMITMENTS AND CONTINGENCIES (Details 2) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 |
Effect of health care trend rate | ' | ' | ' |
1% increase effect on accumulated benefit obligations | $43 | $36 | $40 |
1% increase effect on periodic cost | 5 | 4 | 5 |
1% decrease effect on accumulated benefit obligations | -39 | -33 | -36 |
1% decrease effect on periodic cost | ($5) | ($4) | ($5) |
OTHER_COMMITMENTS_AND_CONTINGE5
OTHER COMMITMENTS AND CONTINGENCIES (Details 3) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 |
Loss Contingencies [Line Items] | ' | ' | ' |
Service cost | $29 | $22 | $25 |
Interest cost | 17 | 15 | 20 |
Amortization of prior service cost | -13 | -13 | -13 |
Amortization of unrecognized prior service costs | -66 | -82 | -85 |
Net periodic postretirement benefit cost | ($33) | ($58) | ($53) |
OTHER_COMMITMENTS_AND_CONTINGE6
OTHER COMMITMENTS AND CONTINGENCIES (Details 4) (USD $) | Feb. 01, 2014 |
In Thousands, unless otherwise specified | |
Expected Benefit Payments, net of retiree contributions | ' |
2014 | $51 |
2015 | 50 |
2016 | 49 |
2017 | 48 |
2018 | 49 |
Next 5 years | $249 |
OTHER_COMMITMENTS_AND_CONTINGE7
OTHER COMMITMENTS AND CONTINGENCIES (Details Textual) (USD $) | 12 Months Ended | ||
Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 | |
Loss Contingencies [Line Items] | ' | ' | ' |
Long-term Line of Credit | $5,600,000 | $7,400,000 | ' |
Letters of Credit Outstanding, Amount | 9,800,000 | 12,200,000 | ' |
Defined Contribution Plan, Maximum Annual Contributions Per Employee, Percent | 60.00% | ' | ' |
Defined Contribution Plan, Maximum Annual Contributions Per Employee, Amount | 17,000 | ' | ' |
Defined Contribution Plan, Employers Matching Contribution, Annual Vesting Percentage | 100.00% | ' | ' |
Defined Contribution Plan, Employer Discretionary Contribution Amount | $200,000 | $200,000 | $200,000 |
Defined Benefit Plan, Ultimate Health Care Cost Trend Rate | 7.20% | ' | ' |
Defined Benefit Plan, Assumptions Used Calculating Benefit Obligation, Discount Rate | 3.60% | 3.10% | ' |
SALES_MIX_Details
SALES MIX (Details) | 12 Months Ended | ||
Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 | |
Segment Reporting Information [Line Items] | ' | ' | ' |
Sales Mix Percentage | 100.00% | 100.00% | 100.00% |
Pharmaceuticals [Member] | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Sales Mix Percentage | 37.70% | 36.30% | 34.90% |
Household Goods [Member] | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Sales Mix Percentage | 21.80% | 22.60% | 23.30% |
Food and Tobacco Products [Member] | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Sales Mix Percentage | 17.60% | 16.70% | 16.80% |
Paper and Cleaning Supplies [Member] | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Sales Mix Percentage | 8.40% | 8.80% | 8.70% |
Health and Beauty Aids [Member] | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Sales Mix Percentage | 7.00% | 7.50% | 7.40% |
Apparel and Linens [Member] | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Sales Mix Percentage | 5.80% | 6.30% | 6.90% |
Sales to Franchised Fred's Stores [Member] | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Sales Mix Percentage | 1.70% | 1.80% | 2.00% |
EXIT_AND_DISPOSAL_ACTIVITY_Det
EXIT AND DISPOSAL ACTIVITY (Details) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Feb. 01, 2014 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' |
Lease contract termination liability, Ending Balance | $0.10 |
Lease Contract Termination Liability [Member] | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' |
Lease contract termination liability, Beginning Balance | 0.2 |
Lease contract termination liability, Additions | 0 |
Lease contract termination liability, Utilized | -0.1 |
Lease contract termination liability, Ending Balance | $0.10 |
EXIT_AND_DISPOSAL_ACTIVITY_Det1
EXIT AND DISPOSAL ACTIVITY (Details Textual) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Feb. 01, 2014 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' |
Lease and Rental Expense, Utilized | $0.10 |
Restructuring Reserve | $0.10 |
QUARTERLY_FINANCIAL_DATA_UNAUD2
QUARTERLY FINANCIAL DATA (UNAUDITED) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||
In Thousands, except Per Share data, unless otherwise specified | Feb. 01, 2014 | Nov. 02, 2013 | Aug. 03, 2013 | 4-May-13 | Feb. 02, 2013 | Oct. 27, 2012 | Jul. 28, 2012 | Apr. 28, 2012 | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 | ||||
Quarterly Financial Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Net sales | $495,033 | $460,542 | $482,176 | $501,495 | $533,380 | $450,574 | $470,816 | $500,505 | $1,939,246 | $1,955,275 | $1,879,059 | ||||
Gross profit | 133,600 | 140,237 | 135,985 | 151,019 | 148,599 | 138,133 | 131,758 | 147,842 | 560,841 | 566,332 | 538,540 | ||||
Net income | $3,966 | $7,308 | $3,330 | $11,411 | $6,556 | $6,561 | $6,054 | $10,458 | $26,015 | $29,629 | $33,428 | ||||
Net income per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Basic (in dollars per share) | $0.11 | $0.20 | $0.09 | $0.31 | $0.18 | $0.18 | $0.17 | $0.28 | $0.71 | $0.81 | $0.88 | ||||
Diluted (in dollars per share) | $0.11 | $0.20 | $0.09 | $0.31 | $0.18 | $0.18 | $0.17 | $0.28 | $0.71 | $0.81 | $0.87 | ||||
Cash dividends paid per common share (in dollars per share) | $0.06 | $0.06 | $0.06 | $0.06 | $0.25 | [1] | $0.06 | [1] | $0.06 | [1] | $0.06 | [1] | $0.24 | $0.43 | $0.20 |
[1] | The $0.25 cash dividend per share paid in the fourth quarter of 2012 consists of a one-time special dividend of $0.19 and the $0.06 regular quarterly dividend. |
QUARTERLY_FINANCIAL_DATA_UNAUD3
QUARTERLY FINANCIAL DATA (UNAUDITED) (Details Textual) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||
Feb. 01, 2014 | Nov. 02, 2013 | Aug. 03, 2013 | 4-May-13 | Feb. 02, 2013 | Oct. 27, 2012 | Jul. 28, 2012 | Apr. 28, 2012 | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 | |||||
Quarterly Financial Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Common Stock, Dividends, Per Share, Cash Paid (in dollars per share) | $0.06 | $0.06 | $0.06 | $0.06 | $0.25 | [1] | $0.06 | [1] | $0.06 | [1] | $0.06 | [1] | $0.24 | $0.43 | $0.20 |
Special Dividend [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Quarterly Financial Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Common Stock, Dividends, Per Share, Cash Paid (in dollars per share) | ' | ' | ' | ' | $0.19 | ' | ' | ' | ' | ' | ' | ||||
Quarterly Dividend [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Quarterly Financial Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||
Common Stock, Dividends, Per Share, Cash Paid (in dollars per share) | ' | ' | ' | ' | $0.06 | ' | ' | ' | ' | ' | ' | ||||
[1] | The $0.25 cash dividend per share paid in the fourth quarter of 2012 consists of a one-time special dividend of $0.19 and the $0.06 regular quarterly dividend. |
Schedule_II_Valuation_and_Qual1
Schedule II - Valuation and Qualifying Accounts (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 01, 2014 | Feb. 02, 2013 | Jan. 28, 2012 |
Allowance for Doubtful Accounts [Member] | ' | ' | ' |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' |
Beginning Balance | $1,994 | $2,100 | $1,652 |
Additions Charged to Costs and Expenses | 1,198 | 627 | 841 |
Deductions and Reclass Adjustments | 1,095 | 733 | 393 |
Ending Balance | 2,097 | 1,994 | 2,100 |
Allowance for Insurance Reserves [Member] | ' | ' | ' |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' |
Beginning Balance | 10,094 | 10,291 | 10,252 |
Additions Charged to Costs and Expenses | 41,917 | 43,761 | 49,058 |
Deductions and Reclass Adjustments | 41,537 | 43,958 | 49,019 |
Ending Balance | $10,474 | $10,094 | $10,291 |