SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
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Date of Report
(Date of earliest
event reported): February 13, 2001
SCHULTZ SAV-O STORES, INC.
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(Exact name of registrant as specified in its charter)
Wisconsin 0-549 39-0600405
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(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
2215 Union Avenue, Sheboygan, Wisconsin 53081
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(Address of principal executive offices, including zip code)
(920) 457-4433
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(Registrant's telephone number)
Item 9. Regulation FD Disclosure.
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On February 13, 2001, the Registrant issued the following press release,
which it is hereby furnishing in this Form 8-K.
Contacts: Elwood F. Winn Armand C. Go
President and Vice President and
Chief Executive Officer Chief Financial Officer
920-208-4109 920-208-4200
FOR IMMEDIATE RELEASE:
SCHULTZ SAV-O STORES REPORTS FISCAL 2000 RESULTS; FIRST QUARTER DIVIDEND
DECLARED
SHEBOYGAN, WI, FEBRUARY 13, 2001 Schultz Sav-O Stores, Inc. (Nasdaq: SAVO) today
reported that diluted earnings per share increased 2.3% to a record $1.33 in
2000, up from $1.30 in 1999. Net earnings for fiscal 2000 decreased 5.3% to
$7,913,000, compared to $8,358,000 in 1999. Net sales for the 52-week fiscal
year ended December 30, 2000 increased nominally to $502,056,000 compared to
$496,959,000 in the prior fiscal year. This is the first time in the Company's
history that the half-billion dollar annual sales volume milestone was reached.
As a result of significant Company stock repurchases in 1999 and 2000, the
weighted average common shares and equivalents were 5,951,000 and 6,438,000 for
2000 and 1999, respectively.
For the 12-week fourth quarter of 2000, diluted earnings per share decreased
4.3% to $0.44 in 2000 from $0.46 in 1999. Net earnings for the fourth quarter
decreased 8.2% to $2,586,000 compared to $2,816,000 for 1999. Sales for the
12-week fourth quarter of 2000 increased 0.1% to $121,568,000, compared to
$121,478,000 for 1999. Although total quarter sales only increased nominally,
the Company is pleased with the sales volume inasmuch as this was compared to
the prior year's fourth quarter when the Company had the successful 50th
anniversary of Piggly Wiggly promotion.
The Company's fourth quarter operational results at year-end were consistent
with trends that started in early 2000. The Company's gross margin for the
fourth quarter of 2000 increased to 16.4% compared to 16.0% for the fourth
quarter of 1999. For the year ended December 30, 2000, the Company's gross
margin increased to 16.5% compared to 16.2% for fiscal 1999. This improvement,
primarily due to retail operations, continued to be attributable to
merchandising and product promotional mix changes that were initiated at the
beginning of 2000. This gross margin improvement was, however, offset by
increased operating and administrative expenses. During 2000, the Company
incurred additional retail health and accident insurance costs of nearly $1.1
million, incremental distribution payroll approximating $500,000, and one-time
professional fees of approximately $400,000.
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Retail sales for the fourth quarter of 2000 decreased 3.4% to $49,197,000,
compared to $50,913,000 for the same quarter of 1999. Total fiscal 2000 retail
sales decreased 0.4% to $207,529,000, compared to $208,422,000 for fiscal 1999.
This decrease was primarily attributable to several of the Company's retail
stores experiencing intense competitive pressures.
Net wholesale sales for the fourth quarter of 2000 increased 2.6% to
$72,371,000, compared to $70,565,000 for the same quarter of 1999. Total fiscal
2000 net wholesale sales increased 2.1% to $294,527,000, compared to
$288,537,000 for fiscal 1999. The net wholesale sales improvement was
attributable to: (1) the successful conversion to the Piggly Wiggly program of
two new market Wisconsin franchise stores from other wholesalers during the
third quarter of 1999; (2) the successful conversion to the Piggly Wiggly
program of one new market Wisconsin franchise unit from another wholesaler in
January 2000; and (3) the opening of one new market franchise supermarket in
Kewaskum, Wisconsin in June 2000. The conversion of one franchise supermarket
into a corporate store in November 1999 and additional competitive activities in
certain franchise market areas offset some of the net wholesale sales volume
increase.
Elwood F. Winn, President and Chief Executive Officer said, "Though continuing
pressures kept us from reporting a more desirable bottom line, the year was a
major success as a result of having eclipsed the long sought after half-billion
dollar annual sales plateau. We are currently pursuing a number of opportunities
to work more aggressively toward the next half-billion dollars in sales. In that
regard, I am very pleased that the Kohler Company has decided to convert the
supermarket it owns and operates in Kohler, WI into a Piggly Wiggly franchise
unit before the end of the second quarter of 2001. The 28,000 square foot store,
which will undergo an interior expansion and remodel, will be a very welcome
addition to our "virtual chain". I also look forward to the unveiling of our
60,000 square foot prototype corporate Piggly Wiggly store scheduled to open mid
to late summer 2001. This store will not only generate additional sales volume,
but also will create tremendous excitement as a model store in the Sheboygan, WI
community as well as throughout our system of franchise and corporate stores. I
look forward to an exciting 2001."
The Company expects to further expand its "virtual chain" during 2001. In
January 2001, a new 55,000 square foot franchise replacement supermarket was
opened in Slinger, WI. Additionally, the Company has store expansion and
remodeling projects currently underway with completion dates scheduled
throughout 2001. These projects include one replacement franchise unit in
Campbellsport, WI, one expanded franchise store in Mequon, WI and two
replacement corporate stores in Sheboygan, WI and Zion, IL, respectively. On an
aggregate basis, these projects, along with the new Slinger supermarket, will
increase square footage by nearly 40%. As of December 30, 2000, the Company
franchised 71 stores and operated 19 corporate retail supermarkets. In spite of
the Company's continued efforts to expand its "virtual chain" concept, the
Company's operating performance continues to be adversely impacted by
competitive openings within the Company's market areas and the under-performance
of certain franchise and corporate retail stores.
Also, separately, the Company announced that its Board of Directors on February
12, 2001 declared a first quarter 2001 cash dividend on its common stock of
$0.09 per share. The dividend is payable on March 9, 2001 to shareholders of
record as of February 27, 2001.
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As a follow-up to this press release, the Company is setting up a conference
call scheduled for Friday, February 16th, at 9:00 a.m. CST. Any interest parties
are invited to call 1-800-619-2425 (press 7286 as a passcode) at such time.
Schultz Sav-O Stores, Inc. is engaged in the food distribution business through
franchised and corporate-owned retail supermarkets and as a wholesaler to
independent food stores. The franchised and corporate-owned retail supermarkets
operate under the name of Piggly Wiggly(R).
ATTACHMENT
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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain matters discussed in this press release are "forward-looking statements"
intended to qualify for the safe harbors from liability established by the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements can generally be identified as such because the context of the
statement will include words such as the Company "believes," "anticipates,"
"expects" or words of similar import. Similarly, statements that describe the
Company's future plans, objectives, strategies or goals are also forward-looking
statements. Such forward-looking statements are subject to certain risks and
uncertainties including, but not limited, to the following: (1) presence of
intense competitive market activity in the Company's market areas; (2) ability
to identify and develop new market locations for expansion purposes; (3)
continuing ability to obtain reasonable vendor marketing funds for promotional
purposes; (4) ongoing advancing information technology requirements; (5) ongoing
absence of food price inflation; (6) the Company's ability to continue to
recruit, train and retain quality franchise and corporate retail store
operators; and (7) the potential recognition of repositioning charges resulting
from potential closures, conversions and consolidations of retail stores due
principally to the competitive nature of the industry and to the quality of the
Company's retail store operators. Shareholders, potential investors and other
readers are urged to consider these factors carefully in evaluating the
forward-looking statements and are cautioned not to place undue reliance on such
forward-looking statements. The forward-looking statements made herein are only
made as of the date of this release and the Company undertakes no obligation to
publicly update such forward-looking statements to reflect subsequent events or
circumstances.
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SCHULTZ SAV-O STORES, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
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For the 12-weeks ended For the 52-weeks ended
December 30, January 1, December 30, January 1,
2000 2000 2000 2000
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Net sales $121,568,000 $121,478,000 $502,056,000 $496,959,000
Costs and expenses:
Cost of products sold 101,588,000 102,025,000 419,303,000 416,609,000
Operating and
administrative expenses 16,011,000 14,883,000 70,488,000 67,108,000
Operating income 3,969,000 4,570,000 12,265,000 13,242,000
Interest income 399,000 202,000 1,349,000 1,175,000
Interest expense (197,000) (171,000) (852,000) (761,000)
Earnings before income taxes 4,171,000 4,601,000 12,762,000 13,656,000
Provision for income taxes 1,585,000 1,785,000 4,849,000 5,298,000
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Net earnings $ 2,586,000 $ 2,816,000 $ 7,913,000 $ 8,358,000
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Earnings per share - diluted $ 0.44 $ 0.46 $ 1.33 $ 1.30
Cash dividends paid per
share of common stock $ 0.09 $ 0.09 $ 0.36 $ 0.34
Weighted average common
shares and equivalents 5,916,000 6,095,000 5,951,000 6,438,000
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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 hereunto duly authorized.
SCHULTZ SAV-O STORES, INC.
Date: February 13, 2001 By: /s/ Armand C. Go
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Armand C. Go
Vice President and Chief
Financial Officer
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