SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) of
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended April 30, 1994 - Commission File No. 0-5091
LA-Z-BOY CHAIR COMPANY
(Exact name of registrant as specified in its charter)
MICHIGAN 38-0751137
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1284 N. Telegraph Road, Monroe, Michigan 48161
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number - Area Code (313) 242-1444
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
COMMON SHARES, $1.00 Par Value
(Title of Class)
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy
or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. X
-----
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, and (2) has been
subject to such filing requirements for the past 90 days.
Yes X No
----- -----
State the aggregate market value of the voting stock held by
nonaffiliates of the registrant as of June 17, 1994.
Common Shares, $1.00 Par Value - $533,081,370
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding at June 17, 1994
Common Shares, $1.00 Par Value 18,303,223
Documents Incorporated By Reference:
Portions of the Annual Report to Shareholders for the year ended
April 30, 1994 are incorporated by reference into Parts I, II, and IV.
Portions of the Annual Proxy Statement filed with the Securities and
Exchange Commission on June 24, 1994 are incorporated by reference into
Parts I and III.
TABLE OF CONTENTS
FORM 10-K ANNUAL REPORT - 1994
LA-Z-BOY CHAIR COMPANY
PART I Page
Item 1. Business.............................................1
Item 2. Properties...........................................5
Item 3. Legal Proceedings....................................8
Item 4. Submission of Matters to a Vote of Security Holders..9
PART II Items 5 through 9....................................9
PART III Items 10 through 13..................................9
PART IV
Item 14. Exhibits, Financial Statement Schedules and
Reports on Form 8-K..................................9
PART I
Item 1. Business
The information required in Part I, Item 1, sections (a), (b) is
contained in the Registrant's Annual Report, as shown in Exhibit I pages 1
thru 7, and is incorporated herein by reference.
(c)(1)(i) Principal Products
The Registrant operates in the furniture industry and as such does
not have differing segments. "Residential" dealers are those who resell
to individuals for their home use. "Contract" seating and casegood
products are sold to commercial dealers. Additional information
regarding products and market share data is contained in the
Registrant's Annual Report, as shown in Exhibit I page 22, and is
incorporated herein by reference.
(c)(1)(ii) Status of New Products or Segments
There were not any major new products or segments during the 1994
fiscal year.
(c)(1)(iii) Raw Materials
The principal raw materials used by the Registrant in the
manufacture of its products are hardwoods for solid wood dining room
and bedroom furniture, casegoods, occasional tables and for the frame
components of seating units; plywood and chipwood for internal parts;
veneers for dining room furniture, wall units, and occasional tables;
water-based and liquid finishes (stains, sealants, lacquers) for
external wood; steel for the mechanisms; leather, cotton, wool,
synthetic and vinyl fabrics for covers; and polyester batting and
non-chlorofluorocarbonated polyurethane foam for cushioning. Steel and
wood products are generally purchased from a number of sources, usually
in the vicinity of the particular plant, and product-covering fabrics
and polyurethane are purchased from a substantial number of sources on
a centralized basis. The Registrant fabricates the majority of the
parts in its products, largely because quality parts made to its exact
specifications are not obtainable at reasonable cost from outside
sources.
Raw materials costs historically have been about 35 percent of net
sales in the upholstery operations and a somewhat higher percentage in
the casegoods operations. Purchased fabric (which includes leather) is
the largest single raw material cost representing about 40 percent of total
upholstery product material costs. Polyurethane (poly) foam for cushions
and padding and lumber are the next two largest types of upholstery raw
material costs. Both fabric and poly are highly sensitive to changes in
the price of oil. Price increases for raw materials excluding lumber have
kept pace with the inflation rate in recent years and are expected to
continue to do so. Lumber prices have increased during the past year by
about 10 to 20 percent, depending on the species of lumber.
- 1 -
Lumber, like most commodities, historically has had sharp changes in
prices over the short term and long term. The Registrant is usually not as
affected by these changes as much as other furniture manufacturers due to
the large percentage of upholstered goods manufactured that do not require
as much lumber as casegoods. Also, wood substitutes, (e.g. steel, plastic)
can be used to some degree in upholstered products.
(c)(1)(iv) Patents, Licenses and Franchises or Concessions
The Registrant has a number of patents on its reclining chair and
rocking chair mechanisms which it believes were important to the early
success of the Registrant and to its present competitive position. It
believes, however, that since it is so firmly established in the
industry, the loss of any single or small group of patents would not
now materially or adversely affect the Registrant's business. The
Registrant has no material licenses, franchises or concessions.
(c)(1)(v) Seasonal Business
The Registrant generally experiences its lowest level of sales
during the first quarter. When possible, the scheduling of production
is designed to maintain generally uniform manufacturing activity
throughout the year, except for mid summer plant shutdowns to coincide
with slower sales.
(c)(1)(vi) Practices Regarding Working Capital Items
The Registrant does not carry significant amounts of upholstered
finished goods inventory to meet rapid delivery requirements of
customers or to assure itself of a continuous allotment of goods from
suppliers. Normal customer terms provide for one payment due within 45
days with a 1 percent discount within 30 days (one installment, 1
percent discount 30 net 45).
Most casegoods finished goods inventories are built to provide for
quicker delivery requirements of customers without installment credit
terms therefore, resulting in higher levels of finished product on hand
at any period in time than the upholstered products. Kincaid and
Hammary divisions primarily sell casegood products. Casegoods are also
sold through the Contract Division.
(c)(1)(vii) Customers
The Registrant distributes to over 12,000 locations. The
Registrant does not have any customer whose sales amount to 10 percent
or more of the Registrant's consolidated sales. The Registrant's
approximate dealer mix consists of 39 percent proprietary, 15 percent
to major dealers (Montgomery Ward and other department stores) and
46 percent to general dealers.
Proprietary stores consist of stores dedicated to the sale of
La-Z-Boy products and in-store dedicated galleries. The dedicated stores
include La-Z-Boy Furniture Galleries stores and Showcase Shoppes. In-
store dedicated galleries have been established for each of the Company's
divisions.
- 2 -
(c)(1)(viii) Orders and Backlog
It has been determined that the majority of the Registrant's
Residential Division orders were for dealer stock, with approximately 35
percent of orders being requested directly by customers. Furthermore,
about 20 percent of units produced at all divisions were built for the
Registrant's inventory. The remainder were "built-to-order" for dealers.
As of July 2, 1994, backlogs were approximately $73 million compared
to approximately $77 million on June 26, 1993. This represents less than
six weeks of sales. On average, orders are shipped in approximately five
weeks. Any measure of backlog at a point in time may not be indicative of
future sales performance. The Registrant does not rely on backlogs to
predict future sales since the sales cycle is only five weeks and backlog
can change a lot from week to week.
The decrease in backlogs from 1993 to 1994 can be attributed largely
to the unusually high backlog of orders at the end of 1993. At that time
the furniture industry was emerging from a four year recession and the
Registrant had just introduced many new products, such as the American
Home Collection.
The cancellation policy for La-Z-Boy Chair Company, in general,
is that an order cannot be cancelled after it has been put into
production. Orders from prebuilt stock though, may be cancelled up to the
time of shipment.
(c)(1)(ix) Renegotiation Contracts
The Registrant does not have any material portion of business
which may be subject to renegotiation of profits or termination of
contracts or subcontracts at the election of the Government.
(c)(1)(x) Competitive Conditions
The Registrant believes that it ranks third in the U.S. in dollar
volume of sales within the Residential furniture industry, which
includes manufacturers of bedroom, dining room and living room
furniture. Based on the most accurate statistics available, the
Registrant believes that it is the largest manufacturer of upholstered
products and solid wood bedroom/dining room products in the United
States.
The Registrant competes primarily by emphasis on quality of its
products, dealer support and a lifetime warranty on the reclining and
legrest mechanisms.
The Registrant has approximately fifteen major competitors in the
reclining or motion chair field and a substantially larger number of
competitors in the upholstery business as a whole and in the Casegoods
and Contract businesses.
The Registrant's best U.S. market share information (in dollars,
not units) indicates that it has about 30 to 35 percent of the
recliner market, above 8 percent of the residential upholstery market,
and less than 2 percent of the residential casegoods market. These
market shares have been increasing slightly over the last three years
in most lines.
- 3 -
(c)(1)(xi) Research & Developement
The Registrant spent $6.4 million in fiscal 1994 for new product
development, existing product improvement, quality control,
improvement of current manufacturing operations and research into the
use of new materials in the construction of its products. The
Registrant spent $6.2 million in fiscal 1993 on such activities and
$5.5 million on such activities in fiscal 1992. The Registrant's
customers do not engage in research with respect to the Registrant's
products.
(c)(1)(xii) Compliance with Environmental Regulations
The Registrant believes that its capital expenditures, earnings
and competitive position will not be materially affected by ongoing "de
minimus level" potentially responsible party (PRP) activities at three
clean-up sites, and that they will not be affected as a result of
maintaining necessary compliance with federal, state or local
environmental regulations.
The Registrant has kept abreast of ongoing activities at the three
clean-up sites. Over the past year, the costs to the Registrant La-Z-Boy
have been in keeping with its established status as a de minimus party,
and have been minor. For the future, ongoing costs at two of the sites
(Caldwell Systems - North Carolina RCRA closure; Organic Chemical -
Michigan NPL site closure) are projected to remain the same.
Activities at the third site (Seaboard Chemical - North Carolina RCRA
closure), have now been completed for the first phase. It is
anticipated that a Remedial Investigation/Feasibility Study (RI/FS)
will be performed to define activities required for subsequent clean-up
phases. Until the RI/FS is completed, and a remedy selected, it is not
possible to estimate the costs for this activity. However, the volume
of material generated and sent to this site by all the Registrant's
facilities is less than one-quarter of one percent of the total volume of
hazardous wastes accounted for at this site. On this basis, we would
reasonably anticipate that future activities will not have a
significant effect on capital expenditures, earnings or competitive
position.
The Registrant's current environmental compliance concerns are focused
on new regulations for Storm Water Pollution Prevention and the 1990
Clean Air Act Amendments. The Registrant has participated in a group storm
water permit program sponsored by its trade association (American
Furniture Manufacturers Association - AFMA); has contracted with a
consulting firm to provide assistance to its plants with the
development of Storm Water Pollution Prevention Plans; and has
contracted with another firm to conduct detailed air emission
inventories and assist in the preparation of timely and complete
operating permits for Clean Air Act compliance. The Registrant feels that
compliance with these issues is important for maintaining its ongoing
operations and competitive position. The Registrant does not anticipate
that this compliance effort will have a significant effect on capital
expenditures, earnings or competitive position.
(c)(1)(xiii) Number of Employees
The Registrant and its subsidiaries employed 9,370 persons as of
April 30, 1994 and 8,724 persons as of April 24, 1993.
- 4 -
(d) Financial Information about Foreign and Domestic Operations and
Export Sales.
The Registrant does not make any material amount of sales of
upholstered furniture to foreign customers. The Registrant sells
upholstered furniture to Canadian customers through its Canadian
subsidiary, La-Z-Boy Canada Limited.
The Registrant also derives an insignificant amount of royalty
revenues from the sale and licensing of its trademarks, tradenames and
patents to certain foreign manufacturers.
Export sales are increasing, but no specific sales objectives have
been set at this time.
Item 2. Properties
In the United States, the Registrant operates twenty-three
manufacturing plants (most with warehousing space), has an automated
fabric processing center and divisional and corporate offices. The
Registrant has one manufacturing plant in Canada.
The location of these plants, the approximate floor space,
principal operations conducted and the approximate number of employees
at such locations as of April 30, 1994 are as follows:
Floor Space Number of
Location (square feet) Operations Conducted Details Employees
-------- ------------- --------------------- ------- ---------
Monroe, 233,900 Corporate offices (1) 476
Michigan
Newton, 628,175 Manufacture, assembly, (2) 1,136
Mississippi leather cutting and
warehousing of upholstery
Redlands, 189,125 Upholstering, assembly (3) 267
California and warehousing of
upholstery
Florence, 414,920 Manufacture, assembly (4) 449
South Carolina and warehousing of
upholstery
Florence, 48,400 Fabric processing (5) 17
South Carolina center
Neosho, 560,640 Manufacture, assembly (6) 1,105
Missouri and warehousing of
upholstery
Dayton, 909,320 Manufacture, assembly (7) 1,808
Tennessee and warehousing of
upholstery
- 5 -
Floor Space Number of
Location (square feet) Operations Conducted Details Employees
------------ ------------ ---------------------- --------- ---------
Siloam Springs, 200,910 Manufacture and (8) 296
Arkansas assembly of upholstery
Tremonton, 672,770 Manufacture, assembly (9) 839
Utah and warehousing of
upholstery
Leland, 311,990 Manufacture, assembly and (10) 413
Mississippi warehousing of Contract
casegoods and upholstery
Waterloo, 257,340 Manufacture, assembly, (11) 412
Ontario and warehousing of
upholstery
Lincolnton, 373,830 Manufacture and (12) 393
North Carolina assembly of upholstery
Grand Rapids, 440,000 Manufacture and assembly (13) 117
Michigan of Contract office
furniture/systems
Lenoir area 554,770 Manufacture, assembly and (14) 467
(Hammary), warehousing of primarily
North Carolina Casegoods and some
upholstered products
Hudson area 1,045,050 Manufacture, assembly, (15) 1,175
(Kincaid), and warehousing of
North Carolina Casegoods
--------- -----
6,841,140 9,370
(1) On December 1, 1974, the Registrant purchased from Floral City
Furniture Company a 15,700 square foot showroom adjacent to
the Registrant's Home Office and a plant on Telegraph Road in
Monroe, Michigan. This facility was constructed in 1935 and
expanded in 1970 to a total square footage of 215,200. It was
brought to its present size by an addition of 18,700 square
feet in 1990.
(2) Originally built in 1961 with 274,200 square feet of space and
includes: 190,000 square foot addition started during 1986,
4,000 square feet added in 1990, 19,100 square feet
constructed in 1991 and 13,510 square feet added in 1992. In
1992, an 82,500 square foot woodworking facility was
constructed. During 1993, the manufacturing and warehouse
buildings were expanded a total of 43,200 square feet. In
1994, a chiller building and a conveyor pit were constructed.
- 6 -
(3) The original building of 158,670 square feet was constructed
in 1967. A 21,200 square foot warehouse addition was completed
in 1987 and a 9,255 square foot warehouse addition was completed
in 1992.
(4) 244,085 and 67,680 square feet represent additions constructed
in 1969 and 1973. In 1994, a 7,020 square foot batting storage
building was completed. The balance represents a building
constructed prior to 1930 and purchased in 1966.
(5) The original building of 24,900 square feet was completed in
1975. The Registrant completed construction of a 23,500
square foot addition to the Fabric Processing Center in 1980.
(6) This facility includes a 130,000 square foot addition completed in
1979, two dry kilns constructed in 1985 at a total square
footage of 4,300, a 72,000 square foot manufacturing addition
completed in 1987 and an addition made in 1990 of 25,000
square feet. During 1993, a 37,500 square foot metal stamping
room was added. The balance of 291,840 represents the original
building which was constructed in 1969.
(7) The original building of 320,420 square feet was constructed
in 1973. Additions include: a 48,800 square foot warehouse
addition completed in 1982, 195,000 square feet started during
1986, 68,700 square feet added in 1990, a major upholstery
plant of 274,600 square feet added in 1991, and an 1,800
square foot storage building completed in 1992.
(8) Includes 24,595 square feet from an addition constructed in
1973, 74,000 square feet represents an addition constructed in
1985, 11,310 square feet were added in 1986 and the balance
represents a building constructed in 1943 and purchased in
1973.
(9) The original building of 220,400 square feet was constructed in
1979. Additions include a 60,000 square foot warehouse addition
completed in 1982, a 121,960 square foot addition completed in
1984, 62,500 square feet of expansion during 1989 and an
upholstery plant addition of 207,910 square feet in 1991.
(10) In 1985, the Registrant acquired the net assets of Dillingham
Manufacturing Company, Inc., which included a 153,500 square
foot manufacturing plant located in Leland, Mississippi. This
building was originally constructed in 1959 and 1970. There
was a 153,035 square foot expansion done during 1990. In 1992,
a 7,300 square foot office addition was completed on the site
of the previous office and in 1993, a 1,450 square foot
maintenance shop was added.
(11) As of February 28, 1979, the Registrant acquired the net
assets of Deluxe Upholstering Limited from the Molson
Companies Limited, which included a 124,300 square foot
manufacturing plant located in Waterloo, Ontario, Canada. In
1985, the Registrant relocated its manufacturing plant in
Waterloo, to an existing facility of 209,820 square feet
within the same city and expanded it to its present size in
1989.
- 7 -
(12) In 1986, the net assets of Burris Industries were acquired,
which included a 373,830 square foot manufacturing plant
located in Lincolnton, North Carolina. The building parts were
constructed in 1963, 1965, 1969 and 1974.
(13) In 1986, the net assets of RoseJohnson Incorporated were
acquired, which included a three building total of 440,000
square feet located in Grand Rapids, Michigan. Two of the
buildings were constructed in the early 1900's. Of the two
buildings, one building contains 185,000 total square feet, while
the other building contains 145,000 square feet. The third
building, consisting of 110,000 square feet, was completed in 1960.
(14) In 1986, the operating assets of Hammary Furniture Company
were acquired, which included three maufacturing facilities:
one built in 1946 consisting of 136,500 square feet located in
Lenoir, North Carolina; another constructed in 1968 with
341,580 square feet, including a warehouse of 141,000 built in
1990, located in Granite Falls, North Carolina; and a third
facility in Sawmills, North Carolina, built in 1963 consisting
of 75,000 square feet. During 1993, a 4,000 square foot dry
lumber storage building was built to replace a 2,310 square
foot building that was torn down.
(15) In 1988, the net assets of Kincaid Furniture Company were
acquired, which included 730,000 square feet in six
manufacturing locations within North Carolina. A 237,500
square foot warehouse addition was completed in 1991 and a
5,000 square foot boiler building was added in 1993. During
1994, the completion of the following additions expanded
Kincaid by 72,550 square feet: a cafeteria, a rough mill
building, a dry shed building, and a finishing room.
The Monroe, Michigan; Redlands, California; Dayton, Tennessee; Siloam
Springs, Arkansas; Waterloo, Ontario, Canada; Lincolnton, North
Carolina; Grand Rapids, Michigan; Lenoir, North Carolina; Hudson, North
Carolina and Newton, Mississippi woodworking facility plants are owned
in fee by the Registrant. The Florence, South Carolina; Neosho,
Missouri; Newton, Mississippi and Tremonton, Utah plants as well as the
automated Fabric Processing Center were financed by the issuance of
industrial revenue bonds and are occupied under long-term leases with
government authorities. The Leland, Mississippi plant is under a long
term lease between the Board of Supervisors of Washington County,
Mississippi (lessor) and La-Z-Boy Chair Company (lessee). These leases
are capitalized on the Registrant's books. The Registrant believes
that its plants are well maintained, in good operating condition and
will be adequate to meet its present and near future business
requirements. The average age of the Registrants' properties is 25
years.
Item 3. Legal Proceedings
Information relating to certain legal proceedings (Note 9 of the
Consolidated Financial Statements in the Registrant's Annual Report to
Shareholders for 1994, as shown in Exhibit I page 21) is incorporated
herein by reference.
- 8 -
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable.
PART II
The information required in Part II (Items 5 thru 8) is contained
in the La-Z-Boy Chair Company's Annual Report to Shareholders for 1994,
Exhibit I pages 8 thru 29, and is incorporated herein by reference.
In reference to Item 9 (changes in and disagreements with accountants
on accounting and financial disclosure), a Form 8-K has not been filed
within the twenty-four month period preceding April 30, 1994.
PART III
The information required in Part III (Items 10 thru 13) is
contained in the Registrant's proxy statement dated June 24, 1994, as shown
in Exhibit II on pages 1 thru 14, and is incorporated herein by reference.
PART IV
Item 14. Exhibits, Financial Statements, Schedules and Reports on Form 8-K
Listed below are the documents filed as part of this report:
(a) Financial Statements
Consolidated Financial Statements and Schedules and report of Price
Waterhouse, as set forth in the accompanying Index to Financial
Statements.
(b) Reports on Form 8-K
News Release and Financial Information Release filed on Form 8-K, dated
June 2, 1994 (Commission File No. 0-5091) is incorporated herein by
reference.
(c) Exhibits
I. 1994 Annual Report to Shareholders
II. 1994 Proxy Statement
III. Articles of Incorporation filed on Form 10-K dated July 20,
1993 (Commission File No. 0-5091) is incorporated herein by
reference.
IV. By-laws filed on Form 10-K dated July 20, 1993 (Commission File
No. 0-5091) is incorporated herein by reference.
- 9 -
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
LA-Z-BOY CHAIR COMPANY
BY s\ C. T. Knabusch July 25, 1994
-----------------
C. T. Knabusch
Chairman of the Board, President
and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of
the Registrant and in the capacities and on the dates indicated.
s\ E. J. Shoemaker Executive Vice President of July 25, 1994
------------------- Engineering, Director and Vice
E. J. Shoemaker Chairman of the Board
s\ C. T. Knabusch Chairman of the Board, President July 25, 1994
------------------- and Chief Executive Officer
C. T. Knabusch
s\ G. M. Hardy Secretary and Treasurer, Principal July 25, 1994
------------------- Accounting Officer and Director
G. M. Hardy
s\ F. H. Jackson Vice President Finance, Principal July 25, 1994
------------------- Financial Officer and Director
F. H. Jackson
s\ P. H. Norton Senior Vice President Sales and July 25, 1994
------------------- Marketing and Director
P. H. Norton
s\ L. G. Stevens Director July 25, 1994
-------------------
L. G. Stevens
s\ J. F. Weaver Director July 25, 1994
-------------------
J. F. Weaver
s\ D. K. Hehl Director July 25, 1994
-------------------
D. K. Hehl
s\ R. E. Lipford Director July 25, 1994
-------------------
R. E. Lipford
s\ W. W. Gruber Director July 25, 1994
-------------------
W. W. Gruber
s\ J. W. Johnston Director, Mr. Johnston is the July 25, 1994
------------------- son-in-law of E. J. Shoemaker
J. W. Johnston
- 10 -
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statements on Form S-8 (Nos. 33-8996, 33-8997, 33-31502, and 33-50318) of
La-Z-Boy Chair Company of our report dated June 2, 1994 appearing in
the Annual Report to Shareholders, as shown in Exhibit I page 9, which is
incorporated in this Annual Report on Form 10-K. We also consent to the
incorporation by reference of our report on the Financial Statement
Schedules, which appears on page S-2 of this Form 10-K.
PRICE WATERHOUSE
Toledo, Ohio
July 22, 1994
- 11 -
ANNUAL REPORT ON FORM 10-K
ITEM 14(a) and ITEM 14(d)
LIST OF FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
YEARS ENDED APRIL 30, 1994, APRIL 24, 1993, AND APRIL 25, 1992
LA-Z-BOY CHAIR COMPANY
MONROE, MICHIGAN
- 12 -
INDEX TO FINANCIAL STATEMENTS
The financial statements, together with the report thereon of
Price Waterhouse dated June 2, 1994 appearing on pages 9 thru 29 of
Exhibit I, the 1994 Annual Report to Shareholders is incorporated by
reference in this Form 10-K Annual Report. With the exception of the
aforementioned information, and the information incorporated in Part II,
the 1994 Annual Report to Shareholders is not to be deemed filed as part of
this report. The following financial statement schedules should be read in
conjunction with the financial statements in such 1994 Annual Report to
Shareholders. Financial statement schedules not included in this Form 10-K
Annual Report have been omitted because they are not applicable or the
required information is shown in the financial statements or notes
thereto.
FINANCIAL STATEMENT SCHEDULES
1994, 1993, AND 1992
Page
---------
Report of Independent Accountants on
Financial Statement Schedules S-2
Schedule V Property, Plant and Equipment S-3
Schedule VI Accumulated Depreciation, Depletion and
Amortization of Property, Plant and Equipment S-4
Schedule VIII Valuation and Qualifying Accounts S-5
Schedule X Supplementary Income Statement Information S-6
S - 1
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REPORT OF INDEPENDENT ACCOUNTANTS
ON FINANCIAL STATEMENT SCHEDULES
To the Board of Directors of
La-Z-Boy Chair Company
Our audits of the consolidated financial statements referred to in our
report dated June 2, 1994 appearing in Exhibit I on page 9, of the 1994
Annual Report to Shareholders of La-Z-Boy Chair Company (which report and
consolidated financial statements are incorporated by reference in
this Annual Report on Form 10-K) also included an audit of the
Financial Statement Schedules listed in Item 14(a) of this Form 10-K.
In our opinion, these Financial Statement Schedules present fairly, in
all material respects, the information set forth therein when read in
conjunction with the related consolidated financial statements.
PRICE WATERHOUSE
Toledo, Ohio
June 2, 1994
S - 2
- 14 -
LA-Z-BOY CHAIR COMPANY AND SUBSIDIARIES
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT
(Dollars in thousands)
Foreign
Balance Currency Other
at Additions Trans- Adjust- Balance
Beginning & Reclass- Retire- lation ments at end of
Classification of Period ifications ments Adjustments (1) Period
- - -------------- --------- ---------- ------- ----------- ------ --------
Year ended April 30, 1994
Land and land
improvements $6,604 $543 $0 ($30) $0 $7,117
Buildings and
building
fixtures 88,669 4,551 (40) (460) 0 92,720
Machinery and
equipment 73,281 10,209 (237) (282) 0 82,971
Information
systems 10,523 1,736 (2,376) (24) 0 9,859
Other 12,092 446 (686) (63) 0 11,789
-------- ------- -------- ------ ------ --------
Total $191,169 $17,485 ($3,339) ($859) $0 $204,456
======== ======= ======== ====== ====== ========
Year ended April 24, 1993
Land and land
improvements $6,184 $562 ($120) ($22) $0 $6,604
Buildings and
building
fixtures 89,082 2,668 (2,749) (332) 0 88,669
Machinery and
equipment 67,519 7,149 (1,189) (198) 0 73,281
Information
systems 10,212 530 (202) (17) 0 10,523
Other 12,792 1,339 (1,992) (47) 0 12,092
-------- ------- -------- ------ ----- --------
Total $185,789 $12,248 ($6,252) ($616) $0 $191,169
======== ======= ======== ====== ===== ========
S - 3
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LA-Z-BOY CHAIR COMPANY AND SUBSIDIARIES
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT
(Dollars in thousands)
(continued)
Foreign
Balance Currency Other
at Additions Trans- Adjust- Balance
Beginning & Reclass- Retire- lation ments at end of
Classification of Period ifications ments Adjustments (1) Period
- - -------------- --------- ---------- ------- ----------- ------ --------
Year ended April 25, 1992
Land and land
improvements $5,724 $267 ($1) ($11) $205 $6,184
Buildings and
building
fixtures 84,318 2,760 (86) (163) 2,253 89,082
Machinery and
equipment 61,525 6,279 (1,073) (97) 885 67,519
Information
systems 10,393 1,202 (1,360) (23) 0 10,212
Other 11,928 1,679 (1,103) (8) 286 12,792
-------- ------- -------- ------ ------ --------
Total $173,888 $12,187 ($3,623) ($302) $3,629 $185,789
======== ======= ======== ====== ====== ========
NOTE: Land improvements, buildings and building fixtures, machinery and
equipment, information systems and other are depreciated using
primarily accelerated methods over the estimated useful lives of
the assets as follows:
Years
Land improvements 20
Buildings and building fixture 15 to 30
Machinery and equipment 10
Information systems 5
Other 3 to 10
(1): The other adjustments column reflects a non-cash write-up of
assets previously written down in fiscal year 1988. These assets
are physically still in use, therefore $3,639 in installed cost
and $3,361 in accumulated depreciation was added back. The net
book value write-up of $278 was recognized as a credit to
depreciation expense and a debit to accumulated depreciation in
fiscal year 1992 and is not shown in this 10-K but is included in
the cash flow statement.
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LA-Z-BOY CHAIR COMPANY AND SUBSIDIARIES
SCHEDULE VI - ACCUMULATED DEPRECIATION, DEPLETION, AND AMORTIZATION
OF PROPERTY, PLANT AND EQUIPMENT
(Dollars in thousands)
Foreign
Balance Currency Other
at Additions Trans- Adjust- Balance
Beginning & Reclass- Retire- lation ments at end of
Classification of Period ifications ments Adjustments (1) Period
- - -------------- --------- ---------- ------- ----------- ------ ---------
Year ended April 30, 1994
Land and
improvements $1,570 $209 $0 ($5) $0 $1,774
Buildings and
building
fixtures 35,919 3,903 (4) (146) 0 39,672
Machinery and
equipment 45,295 6,819 (180) (220) 0 51,714
Information
systems 8,986 1,034 (2,323) (22) 0 7,675
Other 8,992 1,065 (655) (58) 0 9,344
-------- ------- -------- ------ ----- --------
Total $100,762 $13,030 ($3,162) ($451) $0 $110,179
======== ======= ======== ====== ===== ========
Year ended April 24, 1993
Land and
improvements $1,495 $191 ($113) ($3) $0 $1,570
Buildings and
building
fixtures 32,917 3,950 (854) (94) 0 35,919
Machinery and
equipment 40,036 6,452 (1,046) (147) 0 45,295
Information
systems 8,065 1,134 (198) (15) 0 8,986
Other 9,836 1,134 (1,941) (37) 0 8,992
------- ------- -------- ------ ----- --------
Total $92,349 $12,861 ($4,152) ($296) $0 $100,762
======= ======= ======== ====== ===== ========
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LA-Z-BOY CHAIR COMPANY AND SUBSIDIARIES
SCHEDULE VI - ACCUMULATED DEPRECIATION, DEPLETION, AND AMORTIZATION
OF PROPERTY, PLANT AND EQUIPMENT
(Dollars in thousands)
(Continued)
Balance Foreign Other
at Additions Trans- Adjust- Balance
Beginning & Reclass- Retire- lation ments at end of
Classification of Period ifications ments Adjustments (1) Period
- - -------------- --------- ---------- ------- ----------- ------ -------
Year ended April 25, 1992
Land and land
improvements $1,251 $184 ($1) ($1) $62 $1,495
Buildings and
building
fixtures 26,959 3,918 (48) (40) 2,128 32,917
Machinery and
equipment 33,924 6,235 (935) (65) 877 40,036
Information
systems 7,170 1,971 (1,056) (20) 0 8,065
Other 9,076 1,543 (1,075) (2) 294 9,836
------- ------- -------- ------ ------ --------
Total $78,380 $13,851 ($3,115) ($128) $3,361 $92,349
======= ======= ======== ====== ====== ========
(1) The other adjustments column reflects a non-cash write-up of assets
previously written down in fiscal year 1988. These assets are
physically still in use, therefore $3,639 in installed cost and
$3,361 in accumulated depreciation was added back. The net book
value write-up of $278 was recognized as a credit to depreciation
expense and a debit to accumulated depreciation in fiscal year 1992
and is not shown in this 10-K but is included in the cash flow
statement.
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LA-Z-BOY CHAIR COMPANY AND SUBSIDIARIES
SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS
(Dollars in thousands)
Trade
accounts
Additions receivable
Balance at charged to "written off" Balance
beginning costs and net of at end of
Description of period expenses recoveries period
------------------- ---------- ---------- ------------- ---------
YEAR ENDED
APRIL 30, 1994:
Allowance for
doubtful accounts &
long-term notes $11,670 $7,578 $4,453 $14,795
Accrued Warranties $6,250 $400 $6,650
YEAR ENDED
APRIL 24, 1993:
Allowance for
doubtful accounts &
long-term notes $7,217 $7,891 $3,438 $11,670
Accrued Warranties $5,950 $300 $6,250
YEAR ENDED
APRIL 25, 1992:
Allowance for
doubtful accounts
receivable $11,351 $9,271 $13,397 $7,217
Accrued Warranties $5,650 $300 $5,950
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LA-Z-BOY CHAIR COMPANY AND SUBSIDIARIES
SCHEDULE X - SUPPLEMENTARY INCOME STATEMENT INFORMATION
(Dollars in thousands)
Charged to Costs
and Expenses
----------------
Year ended April 30, 1994
Maintenance and repairs $18,990
Advertising costs $19,558
Year ended April 24, 1993
Maintenance and repairs $16,360
Advertising costs $19,558
Year ended April 25, 1992
Maintenance and repairs $13,203
Advertising costs $19,041
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