SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-1004
FORM 10-Q
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
FOR QUARTER ENDED July 27, 1996 COMMISSION FILE NUMBER 1-9656
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 North Telegraph Road, Monroe, Michigan 48162-3390
(Address of principal executive offices) (Zip Code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (313) 241-4414
None
Former name, former address and former fiscal year, if changed since last
report.
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 [ ]
Indicate the number of shares outstanding of each issuer's classes of common
stock, as of the last practicable date:
Class Outstanding at July 27, 1996
Common Shares, $1.00 par value 18,164,437
Part I. Financial Information
The Consolidated Balance Sheet and Consolidated Statement of Income required
for Part I are contained in the Registrant's Financial Information Release
dated August 14, 1996 and are incorporated herein by reference.
LA-Z-BOY CHAIR COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(Unaudited, dollar amounts in thousands)
Three Months Ended
------------------
July 27, July 29,
1996 1995
------- --------
Cash Flows from Operating Activities
Net income $4,598 $3,175
Adjustments to reconcile net income
to net cash provided by operating
activities
Depreciation and amortization 4,855 4,684
Change in receivables 44,935 37,849
Change in inventories (12,928) (4,393)
Change in other assets and liab. (19,136) (15,846)
Change in deferred taxes - -
-------- --------
Total adjustments 17,726 22,294
-------- --------
Cash Provided by Operating
Activities 22,324 25,469
Cash Flows from Investing Activities
Proceeds from disposals of assets 113 133
Capital expenditures (4,580) (3,160)
Change in other investments (5,621) 959
--------- --------
Cash Used for Investing Activities (10,201) (2,068)
Cash Flows from Financing Activities
Short-term debt - -
Long-term debt - -
Retirements of debt (2,940) (4,072)
Capital leasees - -
Capital lease principal payments (565) (517)
Stock for stock option plans 1,470 1,268
Stock for 401(k) employee plans 383 305
Purchase of La-Z-Boy stock (7,126) (4,392)
Payment of cash dividends (3,482) (3,155)
--------- --------
Cash Used for Financing Activities (12,260) (10,563)
Effect of exch. rate changes on cash (53) (78)
--------- --------
Net change in cash and equivalents (190) 12,760
Cash and equiv. at beginning of period 27,060 27,048
--------- --------
Cash and equiv. at end of period $26,870 $39,808
========= ========
Cash paid during period - Income taxes $2,257 $1,657
- Interest $833 $1,110
For purposes of the Statement of Cash Flows, the Company considers all highly
liquid debt instruments purchased with a maturity of three months or less to
be cash equivalents.
The accompanying Notes to Condensed Consolidated Financial Statements are an
integral part of these statements.
LA-Z-BOY CHAIR COMPANY AND OPERATING DIVISIONS
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
The financial information is prepared in conformity with generally
accepted accounting principles and such principles are applied on a basis
consistent with those reflected in the 1996 Annual Report filed with the
Securities and Exchange Commission. The financial information included
herein, other than the consolidated condensed balance sheet as of April
27, 1996, has been prepared by management without audit by independent
certified public accountants who do not express an opinion thereon. The
consolidated condensed balance sheet as of July 27, 1996 has been derived
from, but does not include all the disclosures contained in, the audited
consolidated financial statements for the year ended April 27, 1996. The
information furnished includes all adjustments and accruals consisting
only of normal recurring accrual adjustments which are, in the opinion of
management, necessary for a fair presentation of results for the interim
period.
2. Interim Results
The foregoing interim results are not necessarily indicative of the
results of operations for the full fiscal year ending April 26, 1997.
3. Commitments and Contingencies
There has been no significant change from the prior fiscal year end
audited financial statements.
LA-Z-BOY CHAIR COMPANY AND OPERATING DIVISIONS
MANAGEMENT DISCUSSION
La-Z-Boy's sales and profits historically have been weakest in the first
quarter of the fiscal year due to the Company's two-week vacation shutdown
which coincides with the slowest sales period. Therefore, first quarter
comparison to the prior year's first quarter may not be indicative of trends
that will continue in the remaining quarters of the fiscal year.
Due to the cyclical nature of the Company's business, comparison of
operations between the most recently completed quarter and the immediate
preceding quarter would not be meaningful and could be misleading to the
reader of these financial statements.
For further Management Discussion, see attached Exhibit 99
The Company's strong financial position is reflected in the debt to capital
percentage of 16% and a current ratio of 3.9 to 1 at the end of the first
quarter. At April 27, 1996, the debt to capital percentage was 20% and the
current ratio was 3.7 to 1. At the end of the preceding year's first
quarter, the debt to capital percentage was 20% and the current ratio was
4.0 to 1. As of July 27, 1996, there was $63 million of unused lines of
credit available under several credit arrangements.
Approximately 29% of the 3 million shares of Company stock authorized for
purchase on the open market are still available for purchase by the Company.
The Company plans to be in the market for its shares as changes in its stock
price and other factors present appropriate opportunities.
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
The Annual Meeting of Shareholders of La-Z-Boy Chair Company was held on
July 29, 1996, for the purposes of electing four members to the board of
directors, amending and restating the Company's 1993 Performance-Based Stock
Plan and amending the Company's Articles of Incorporation to change the
Company's name to "La-Z-Boy Incorporated". Proxies for the meeting were
solicited pursuant to Section 14(a) of the Securities and Exchange Act of
1934 and there was no solicitation in opposition of Management's
solicitations. The Shareholders elected all of Management's nominees for
directors as listed in the proxy statement and approved amending and
restating the stock plan and changing the Company name. The name change is
expected to become effective August 30, 1996.
Item 6. Exhibits and Reports on Form 8-K
(a) (27) Financial Data Schedule (EDGAR only)
(99) News Release and Financial Information Release: re Actual
first quarter results and Management Discussion dated
August 14, 1996.
(b) An 8-K was filed on May 30, 1996 releasing fourth quarter and
full year financial results. This release also included the financial
section of the 1996 Annual Report.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused the Quarterly Report on Form 10-Q for the quarter
ended July 27, 1996 to be signed on its behalf by the undersigned thereunto
duly authorized.
LA-Z-BOY CHAIR COMPANY
(Registrant)
/s/ James J. Korsnack
Date August 14, 1996 James J. Korsnack
Corporate Controller