UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(X) Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended ....... October 31, 1999
OR
( ) Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Commission file Number 0-20269
DUCKWALL-ALCO STORES, INC.
(Exact name of registrant as specified in its charter.)
Kansas 48-0201080
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
401 Cottage Avenue
Abilene, Kansas 67410-2832
(Address of principal executive offices (Zip Code)
Registrant's telephone number, including area code:
(785) 263-3350
Indicate by check mark whether the registrant(1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES [X] NO [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS:
4,772,299 shares of common stock, $.0001 par value (the issuer's
only class of common stock), were outstanding as of October 31, 1999.
PART I. Financial Information.
ITEM 1. Financial Statements.
Duckwall-ALCO Stores, Inc.
And Subsidiaries
Consolidated Balance Sheets
(Dollars in Thousands)
October 31, January 31,
1999 1999
(Unaudited)
___________ __________
ASSETS
Current assets:
Cash and cash equivalents $ 5,826 $10,423
Receivables 3,648 3,557
Inventories 134,422 113,225
Prepaid expenses and other current
assets 1,000 359
Total current assets 144,896 127,564
Property and equipment 78,560 73,967
Less accumulated depreciation 39,181 35,340
Net property and equipment 39,379 38,627
Property under capital leases 20,407 20,407
Less accumulated amortization 14,878 14,428
Net property under capital leases 5,529 5,979
Other non-current assets 258 304
Total assets $190,062 $172,474
<FN>
See accompanying notes to unaudited consolidated financial statements.
Duckwall-ALCO Stores, Inc.
And Subsidiaries
Consolidated Balance Sheets
(Dollars in Thousands)
October 31, January 31,
1999 1999
(unaudited)
___________ ____________
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of:
Long term debt $1,420 $1,556
Capital lease obligations 540 540
Accounts payable 37,523 20,488
Income taxes payable 0 1,780
Accrued salaries and commissions 3,655 4,705
Accrued taxes other than income 4,386 3,520
Other current liabilities 1,713 2,643
Deferred income taxes 2,256 2,256
Total current liabilities 51,493 37,488
Notes payable under revolving loan 35,040 30,598
Long term debt
less current maturities 3,788 4,825
Capital lease obligations
less current maturities 7,684 8,089
Other noncurrent liabilities 1,440 1,484
Deferred revenue 908 1,075
Deferred income taxes 2,489 2,489
Total liabilities 102,842 86,048
Stockholders' equity:
Common stock, $.0001 par value, authorized
20,000,000 shares; issued and outstanding
4,772,299 shares and 5,092,324 shares
respectively 1 1
Additional paid-in capital 51,481 54,247
Retained earnings since June 2, 1991 35,738 32,178
Total stockholders' equity 87,220 86,426
Total liabilities and
stockholders' equity $190,062 $172,474
<FN>
See accompanying notes to unaudited consolidated financial statements.
Duckwall-ALCO Stores, Inc.
And Subsidiaries
Consolidated Statements of Operations
(Dollars in Thousands Except Per Share Amounts)
(Unaudited)
For the Thirteen Week For the Thirty-Nine Week
Periods Ended Periods Ended
October 31, November 1, October 31, November 1,
1999 1998 1999 1998
___________ ___________ ___________ __________
Net sales ............................... $87,624 $85,308 $268,796 $256,720
Cost of sales ........................... 56,975 56,018 177,115 168,670
Gross margin .................. 30,649 29,290 91,681 88,050
Selling, general
and administrative ................. 26,502 24,854 78,418 74,060
Depreciation
and amortization ................... 1,597 1,568 4,757 4,506
Total operating expenses ...... 28,099 26,422 83,175 78,566
Income from operations .................. 2,550 2,868 8,506 9,484
Interest expense......................... 915 1,083 2,762 3,177
Earnings before income taxes ............ 1,635 1,785 5,744 6,307
Income tax expense ...................... 621 666 2,184 2,401
Earnings before cumulative effect of
accounting change ................... 1,014 1,119 3,560 3,906
Cumulative effect of accounting
change (net of tax) ................. 0 0 0 (956)
Net earnings ............................ $1,014 $1,119 $3,560 $2,950
Per share data - basic
Earnings before cumulative effect of
accounting change ................... $ 0.20 $ 0.22 $ 0.71 $ 0.76
Cumulative effect of accounting change .. .00 0.00 0.00 (0.19)
Net earnings ............................ $ 0.20 $ 0.22 $ 0.71 $ 0.57
Per share data - diluted
Earnings before cumulative effect of
accounting change ................... $ 0.20 $ 0.22 $ 0.71 $ 0.76
Cumulative effect of accounting change .. .00 0.00 0.00 (0.19)
Net earnings ............................ $ 0.20 $ 0.22 $ 0.71 $ 0.57
<FN>
See accompanying notes to unaudited consolidated financial statements.
Duckwall-ALCO Stores, Inc.
And Subsidiaries
Consolidated Statements of Cash Flow
(Dollars in Thousands)
(Unaudited)
For the Thirty-Nine Week
Periods Ended
October 31, 1999 November 1, 1998
---------------- ----------------
Cash flows from operating activities:
Net Earnings $3,560 $2,950
Adjustments to reconcile
net earnings to net cash
used in operating activities
Cumulative effect of accounting
change, net of income tax benefit 0 956
Amortization of debt financing costs 88 92
Depreciation and amortization 4,757 4,506
LIFO expense 374 0
Increase in inventories (21,571) (24,753)
Increase in accounts payable 17,035 16,247
Increase in receivables (91) (897)
Decrease (increase) in prepaid expenses
and other current assets (641) 111
Increase in accrued taxes other than
income 866 669
Decrease in accrued salary and
commissions (1,050) (1,345)
Decrease in income taxes payable (1,780) (1,661)
Decrease in other liabilities (1,141) (840)
Net cash provided by (used in) operating
activities 406 (3,965)
Cash flow from investing activities:
Capital expenditures (5,087) (7,484)
Increase in other assets (14) 0
Net cash used in investing activities (5,101) (7,484)
Cash flow from financing activities:
Proceeds from exercise of outstanding
stock options 70 372
Common stock retired thru buyback
program (2,836) (668)
Increase in revolving loan 4,442 17,497
Principal payments on long term notes (1,173) (1,078)
Principal payments on capital leases (405) (389)
Debt issue costs 0 (344)
Net cash provided by financing activities 98 15,390
Net increase (decrease) in cash and cash
equivalents (4,597) 3,941
Cash and cash equivalents at beginning of
period 10,423 2,555
Cash and cash equivalents at end of period $5,826 $6,496
<FN>
See accompanying notes to unaudited consolidated financial statements.
Duckwall-ALCO Stores, Inc.
And Subsidiaries
Notes to Unaudited Consolidated Financial Statements
(1) Basis of Presentation
The accompanying unaudited consolidated financial
statements are for interim periods and, consequently, do not
include all disclosures required by generally accepted
accounting principles for annual financial statements. It is
suggested that the accompanying unaudited consolidated
financial statements be read in conjunction with the
consolidated financial statements included in the Company's
fiscal 1999 Annual Report. In the opinion of management of
Duckwall-ALCO Stores, Inc., the accompanying unaudited
consolidated financial statements reflect all adjustments
(consisting of normal recurring accruals) necessary to present
fairly the financial position of the Company and the results of
its operations and cash flows for the interim periods.
(2) Principles of Consolidation
The consolidated financial statements include the accounts
of Duckwall-ALCO Stores, Inc. and its wholly-owned subsidiaries.
All significant intercompany transactions and balances have
been eliminated in consolidation.
(3) Earnings Per Share
Earnings per share has been computed based on the weighted
average number of common shares outstanding during the period
plus common stock equivalents, when dilutive, consisting of
stock options.
The average number of shares used in computing earnings
per share was as follows:
Thirteen Weeks Ending Basic Diluted
October 31, 1999 4,966,609 4,966,609
November 1, 1998 5,119,654 5,147,930
Thirty-Nine Weeks Ending
October 31, 1999 5,032,341 5,032,341
November 1, 1998 5,119,681 5,171,450
Duckwall-ALCO Stores, Inc.
And Subsidiaries
[CAPTION]
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
(Dollars in thousands)
The thirteen weeks ended October 31, 1999 and November 1, 1998 are referred
to herein as the third quarter of fiscal 2000 and 1999, respectively.
As used below the term "competitive market" refers to any market wherein
there is one or more national or regional full-line discount stores located
in the market served by the Company. The term "non-competitive market"
refers to any market where there is no national or regional full-line
discount store located in the market served by the Company. Even in a
non-competitive market, the Company faces competition from a variety of
sources.
RESULTS OF OPERATIONS
The Company continues to execute its basic strategy of opening stores in
under-served markets that have no competition from national or regional
full-line discount retailers. During the third quarter of fiscal 2000, the
Company opened 2 ALCO stores and 2 Duckwall stores, all of which were in new,
non-competitive markets, resulting in a quarter end total of 266 stores.
For the thirty-nine week period ending October 31, 1999, the Company opened
17 stores and closed 8 stores. As of October 31, 1999, over 80% of the
stores are in non-competitive markets.
Net sales for the third quarter of fiscal 2000 increased $2,316 or 2.7% to
$87,624 compared to $85,308 for the third quarter of fiscal 1999. Net sales
for the prototype Class 18 ALCO stores open the full period in both the third
quarter of fiscal 2000 and fiscal 1999 (comparable stores) decreased $301 or
1.0%. The Duckwall variety stores produced a decrease of $63 or 1.3%
compared to the third quarter of the prior fiscal year. Net sales for all
stores open the full period decreased $1,458 or 1.9% compared to the third
quarter of the prior fiscal year. Same store sales were impacted by the
planned elimination of three advertising circulars as part of the
implementation of the Company's new pricing strategy "New Low Prices
Everyday" (NLPE).
Net sales for the thirty-nine week period ending October 31, 1999 increased
$12,076 or 4.7% to $268,796 compared to $256,720 in the comparable
thirty-nine week period of the prior fiscal year. Net sales of comparable
class 18 ALCO stores increased by $736 or .8% for the thirty-nine week period
ending October 31, 1999 compared to the thirty-nine week period of the prior
fiscal year. Same store sales were impacted by the elimination of eight
advertising circulars and three promotional handouts as part of the
implementation of NLPE.
Gross margin for the third quarter of fiscal 2000 increased $1,359 or 4.6%
to $30,649 compared to $29,290 in the third quarter of fiscal 1999. Gross
margin as a percentage of sales was 35.0% for the third quarter of fiscal
2000 compared to 34.3% for the third quarter of fiscal 1999. The higher gross
margin percent this thirteen week period was due to lower product costs
compared to the thirteen week period of the prior fiscal year.
Gross margin for the thirty-nine week period ended October 31, 1999 was
$91,681, which was $3,631 or 4.1% higher than last year's thirty-nine week
gross margin of $88,050. As a percent of net sales, gross margin for the
thirty-nine week period ended October 31, 1999 was 34.1% compared to 34.3%
in the thirty-nine week period of the prior fiscal year.
Selling, general and administrative expense increased $1,648 or 6.6% to
$26,502 in the third quarter of fiscal 2000 compared to $24,854 in the
third quarter of fiscal 1999, primarily due to the increase in total stores.
As a percentage of net sales, selling, general and administrative expenses
in the third quarter of fiscal 2000 was 30.2%, compared to 29.1% in the third
quarter of fiscal 1999. The increase was due primarily to expense
inflation, which offset the planned lower advertising costs. Selling,
general and administrative expense was also unfavorably impacted by the
sale-leaseback that was completed in the fourth quarter of fiscal 1999.
The sale-leaseback impacts selling, general and administrative expense
through higher store rent expense, with a corresponding reduction in
depreciation and interest expense.
Selling, general and administrative expense increased $4,358 or 5.9% to
$78,418 for the thirty-nine week period ended October 31, 1999 compared to
$74,060 for the comparable thirty-nine week period of the prior fiscal year.
Selling, general and administrative expense as a percent of net sales was
29.2% for the thirty-nine week period ended October 31, 1999 compared to
28.8% in the comparable thirty-nine week period last year. The increase
in selling, general and administrative expense in fiscal 2000 is primarily
due to an increase in the number of stores as well as expense inflation and
the sale-leaseback described earlier.
Depreciation and amortization expense increased $29 or 1.8% to $1,597 in the
third quarter of fiscal 2000 compared to $1,568 in the third quarter of
fiscal 1999. The increase is due to additional buildings and equipment
associated with the store expansion program.
Income from operations decreased $318 or 11.1% to $2,550 in the third
quarter of fiscal 2000 compared to $2,868 in the third quarter of fiscal
1999. Income from operations as a percentage of net sales was 2.9% in the
third quarter of fiscal 2000 compared to 3.4% in the third quarter of fiscal
1999.
Income from operations decreased $978 or 10.3% to $8,506 for the thirty-nine
week period ended October 31, 1999 compared to $9,484 in the comparable
thirty-nine week period of the prior fiscal year.
Interest expense decreased $168 or 15.5% in the third quarter of fiscal
2000 compared to the third quarter of fiscal 1999.
Net earnings for the third quarter of fiscal 2000 were $1,014, a decrease of
$105 or 9.4% over the net earnings of $1,119 for the third quarter of fiscal
1999.
LIQUIDITY AND CAPITAL RESOURCES
The Company's primary sources of funds are cash flow from operations,
borrowings under its revolving loan credit facility, mortgage financing, and
vendor trade credit financing (increases in accounts payable).
At October 31, 1999 working capital (defined as current assets less current
liabilities) was $93,403 compared to $90,076 at the end of fiscal 1999.
Cash generated (used) by operating activities in the first three quarters
of fiscal 2000 and 1999 was $406 and ($3,965) respectively. The decrease
in the amount of cash used by operating activities in the first three
quarters of fiscal 2000 compared to the first three quarters of fiscal 1999
was primarily due to a larger increase in the trade accounts payable build
up relative to the overall increase in inventory levels.
The Company generated cash from financing activities in the first three
quarters of fiscal 2000 and 1999 of $98 and $15,390, respectively. This
was generated by borrowing under the revolving loan credit facility, as well
as a $1,870 mortgage secured by certain company fixed assets in fiscal 1999.
Cash used for investing activities in the first three quarters of fiscal 2000
and 1999 totaled $5,101 and $7,484, respectively. Total anticipated cash
payments for acquisition of property and equipment in fiscal 2000,
principally for store buildings and store and warehouse fixtures and
equipment, are approximately $9,000.
During the third quarter of fiscal 1999 the Company's Board of Directors
authorized a stock repurchase program. The Company has been authorized to
purchase up to 411,000 shares, or 8% of its outstanding common stock. A total
of 276,900 shares of stock were purchased during the third quarter of the
current fiscal year under this program. The cumulative total number of
shares repurchased under this program was 387,600 as of October 31, 1999.
On November 18, 1999, the Company's Board of Directors authorized an
additional 1,000,000 shares for repurchase.
THE YEAR 2000
The information in this Year 2000 section is a Year 2000 Readiness Disclosure
under the Year 2000 Information Readiness and Disclosure Act.
INTERNAL CONSIDERATIONS
The Company has been evaluating and adjusting all of its known date-sensitive
systems and equipment for Year 2000 readiness. The assessment phase of the
Year 2000 project is substantially complete and mission critical systems have
been substantially remediated or replaced. The assessment phase of the
project included information technology systems as well as non-information
technology equipment. The Company estimates that over 99% of the required
coding conversions on information technology have occurred to-date. The
Company has completed the majority of all known coding conversions, and
returned, or placed these systems into production. This occurred during
the first half of fiscal 2000 as scheduled. Virtually all of the Company's
remediation efforts have been and will continue to be performed by Company
associates and a limited number of selected software and hardware providers.
As systems have been replaced or remediated, system testing has been
conducted prior to return to production. Enterprise wide system testing
will be conducted throughout calendar 1999 and through the end of fiscal
2000.
Rollout of Y2K ready store systems was completed in June of 1999. At this
point the Company believes the store systems to be Y2K ready, however,
additional testing and monitoring continues as deemed necessary.
COSTS RELATED TO YEAR 2000
The total estimated cost of the Company's Year 2000 project is $1,000.
To-date the Company has spent approximately $479 on hardware and software
upgrades (excluding internal costs), and expects to spend as much as an
additional $221. Additionally the Company has or will incur as much as $300
in internal and external programming costs. Additional resources are
providing the Company with some enhancements to proprietary systems, and
project planning has begun for future enhancements.
All expenditures related to the Company's Year 2000 readiness initiatives
have been or will be funded by cash flows from operations, borrowing under
the Company's line of credit, or other financing sources, and have been or
will be capitalized or expensed depending on the classification of the
expenditure according to generally accepted accounting principles.
EXTERNAL CONSIDERATIONS
In addition to internal Year 2000 activities, the Company is communicating
with other companies with which its systems interface or rely upon.
Conversion, testing and implementation of Year 2000 ready EDI transaction is
substantially completed. To-date we have converted 329 out of 341 trading
partners. Nine (9) trading partners are either in test or have been
scheduled for test prior to December 15, 1999, and three (3) trading partners
have been identified as problem vendors. The problem vendors and possibly a
small percentage of the vendors either in test or scheduled for test will be
forced to return to paper/fax transactions. The total annual purchases for
these problem vendors are immaterial. Contingency plans are being developed
where possible and practical for those vendors who appear to be unlikely to
achieve Y2K readiness by December 15, 1999.
There can be no assurance that there will not be adverse effects on the
Company if third parties, such as utility companies or merchandise suppliers,
do not convert their systems in a timely manner and in a way that is
compatible with the Company's systems. However, management believes that
ongoing communications with and assessment of these third parties will
minimize these risks.
The Company recognizes the risks of business disruption resulting from the
noncompliance of service and merchandise suppliers. Possible consequences
include, but are not limited to, loss of basic utilities within certain
locations, inability to process transactions, send or transmit purchase
orders, or engage in similar normal business activities. Additionally, due
to the lack of a uniform definition of Year 2000 compliance, the Company
recognizes the potential of an increase in sales returns of merchandise that
contain embedded chips, or hardware or software components. Due to the
Company's product mix, and the anticipated cooperation from the Company's
suppliers, if returns of merchandise increase, such returns are not expected
to be material to the Company's financial condition.
CONTINGENCY PLANS
To-date the Company has determined areas where contingency planning is
appropriate, and contingency plans and policies have been filed with the
project management office. External dependency contingency planning
continues to be based on ongoing communications with the Company's suppliers
and service providers. Based upon public information available from the
utility companies, the Company considers it unlikely that it will suffer
any extended outage period on the basic utilities. Therefore, the Company
has not prepared a contingency plan to cover extended outages of basic
utilities, because the costs would far outweigh the expected benefits given
the perceived low risk.
SUMMARY
The Company believes its IT systems will be ready for the Year 2000. Should
incidences of non-compliance occur the Company will dedicate both internal
and external resources to resolve any problems. Although the Company is
taking the steps it deems reasonable to mitigate external Year 2000 issues,
many elements of these risks, and the ability to definitively mitigate them,
are outside the control of the Company. Given the importance of certain key
service providers, the inability of these business partners to provide their
services to the Company on a timely basis could have a material adverse effect
on the Company's operations and financial results. Ongoing communications
with the Company's service providers should help mitigate these risks. No
single merchandise vendor accounts for a significant total of the Company's
purchases.
The cost of the conversions and the completion dates are based on management's
best estimates and may be updated as additional information becomes available.
BUSINESS OPERATIONS AND SEGMENT INFORMATION
The Company's business activities include operation of ALCO discount stores
in towns with populations which are typically less than 5,000 not served by
other regional or national full-line discount chains and Duckwall variety
stores that offer a more limited selection of merchandise which are primarily
located in communities of less than 2,500 residents.
For financial reporting purposes, the Company has established two operating
segments: "ALCO Discount Stores", and "All Other", which includes the Duckwall
variety stores and other business activities, such as general office,
warehouse and distribution activities.
For The Thirteen Week For The Thirty-Nine Week
Periods Ended Periods Ended
October 31, November 1, October 31, November 1,
1999 1998 1999 1998
Segment Information
Net Sales:
ALCO Discount Stores $79,785 $77,905 $244,460 $233,574
All Other
External 7,839 7,403 24,336 23,146
Intercompany 57,119 55,696 153,330 152,953
$144,743 $141,004 $422,126 $409,673
Depreciation and Amortization
ALCO Discount Stores $1,010 $849 $2,982 $2,461
All Other 587 719 1,775 2,045
$1,597 $1,568 $4,757 $4,506
Income (expense) from Operations:
ALCO Discount Stores $6,020 $5,892 $21,082 $19,738
All Other (3,485) (3,241) (12,247) (10,863)
$2,535 $2,651 $8,835 $8,875
Capital Expenditures:
ALCO Discount Stores $2,107 $1,382 $3,920 $4,555
All Other 228 702 1,167 2,929
$2,335 $2,084 $5,087 $7,484
Identifiable Assets:
ALCO Discount Stores $142,518 $147,803 $142,518 $147,803
All Other 46,286 40,667 46,286 40,667
$188,804 $188,470 $188,804 $188,470
Income from operations as reflected in the above segment information has been
determined differently than income from operations in the accompanying
consolidated statements of operations as follows:
Intercompany Sales
Intercompany sales represent transfers of merchandise from the warehouse to
ALCO discount stores and Duckwall variety stores.
Intercompany Expense Allocations
General and administrative expenses incurred at the general office have not
been allocated to the ALCO Discount Stores for purposes of determining income
from operations for the segment information.
Warehousing and distribution costs including freight applicable to merchandise
purchases, have been allocated to the ALCO Discount Stores segment based on
the Company's customary method of allocation for such costs (primarily as a
stipulated percentage of merchandise purchases).
Inventories
Inventories are based on the FIFO method for segment information purposes and
on the LIFO method for the consolidated statements of operations.
Property Costs
In fiscal 1999, for ALCO stores for which the Company owns the store building,
rent expense was charged to, and the applicable depreciation expense was
excluded from income from operations for purposes of determining the segment
information for the ALCO Discount Stores. In fiscal 2000, for most such ALCO
stores, no rent expense was charged to, and applicable depreciation expense
was included in income from operations. This change in accounting method
resulted in a $121 increase in income from operations for the ALCO Discount
Store segment in fiscal 2000. There was no effect on income from operations
as reflected in the accompanying consolidated statements of operations.
Leases
All leases are accounted for as operating leases for purposes of determining
income from operations for purposes of determining the segment information
for the ALCO Discount Stores whereas capital leases are accounted for as such
in the consolidated statements of operations.
Identifiable assets as reflected in the above segment information include
cash and cash equivalents, receivables, inventory, property and equipment,
and property under capital leases.
A reconciliation of the segment information to the amounts reported in the
consolidated financial statements is presented below:
For The Thirteen Week For The Thirty-Nine Week
Periods Ended Periods Ended
October 31, November 1, October 31, November 1,
1999 1998 1999 1998
Net sales per above segment information $144,743 $141,004 $422,126 $409,673
Intercompany elimination (57,119) (55,696) (153,330) (152,953)
Net sales per consolidated statements $87,624 $85,308 $268,796 $256,720
of operations
Income from operations per above segment information $2,535 $2,651 $8,835 $8,875
Inventory method 0 0 (373) 0
Property costs 29 241 88 683
Leases (14) (24) (44) (74)
Income from operations per consolidated $2,550 $2,868 $8,506 $9,484
statements of operations
OTHER INFORMATION
PART II
Item 1. Legal Proceedings
No legal proceedings except those covered by insurance occurred
during the thirteen week period ended October 31, 1999.
Item 2. Changes in Securities
Not applicable
Item 3. Defaults Upon Senior Securities
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
Not Applicable
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) None
(b) Reports on Form 8-K
No reports filed
Duckwall-ALCO Stores, Inc.
And Subsidiary
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934
the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
DUCKWALL-ALCO STORES, INC.
(Registrant)
Date, December 10, 1999 /s/Richard A. Mansfield
Richard A. Mansfield
Vice President - Finance
Chief Financial Officer
Signing on behalf of the
registrant and as principal
financial officer