EXHIBIT INDEX ON PAGE 3
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
Date of Report (Date of earliest event reported): May 14, 1997
CARSON PIRIE SCOTT & CO.
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(Exact name of registrant as specified in its charter)
Illinois
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(State or other jurisdiction of incorporation)
0-22682 37-0175980
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Commission File Number (IRS Employer Identification No.)
331 West Wisconsin Avenue, Milwaukee, Wisconsin 53203
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(Address of principal executive offices) (Zip Code)
(414) 347-4141
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Registrant's Telephone Number
Page 1 of 8
Item 5. Other Events.
On May 14, 1996, Carson Pirie Scott & Co. reported its earnings
for the first quarter in a news release, a copy of which is attached
as Exhibit 1.
Item 7. Exhibits.
See Exhibit Index on page 3 of this Current Report on Form 8-K.
SIGNATURE
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.
Dated May 16, 1997.
CARSON PIRIE SCOTT & CO.
By: /s/ Charles J. Hansen
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Charles J. Hansen
Vice President,
General Counsel,
and Secretary
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EXHIBIT INDEX
1. News release, dated May 14, 1997.
Page 3 of 8
Exhibit 1
Investors Media
James L. Stoffel Edward P. Carroll, Jr.
V.P. - Treasurer Executive V.P. Marketing
(414) 278-5769 (414) 347-5340
FOR IMMEDIATE RELEASE WEDNESDAY, MAY 14, 1997
CARSON PIRIE SCOTT & CO. FIRST QUARTER OPERATING
EARNINGS INCREASE 20% TO $0.18 PER SHARE
Milwaukee, Wisconsin, May 14, 1997 - Carson Pirie Scott & Co. (NYSE:CRP) today
reported its first quarter financial results. Stanton J. Bluestone, Chairman and
Chief Executive Officer of Carson Pirie Scott & Co., commented:
"I am pleased to report our eighth consecutive quarter of improvement in
operating earnings per share. A combination of solid sales growth and diligent
expense control generated the operating EPS gains in the quarter."
"Our top line grew 9.0% by virtue of a 4.0% comparable store sales gain and a
5.0 percentage point contribution from the new stores that we opened in 1996.
Our 4.0% comparable store sales growth was broad-based. The feminine sportswear
area continued to be our strongest performer with a 12% sales gain in the
quarter. In addition, the Men's area benefited from the continued rollout of the
American Designer better sportswear lines. Cosmetics, Shoes, Home Textiles,
Luggage and Furniture also recorded healthy sales gains in the quarter."
"Our margin rate held steady during the first quarter and our expense rate
improved a half percentage point moving from 30.1% in 1996 to 29.6% in 1997. The
expense rate improvement reflected good expense control and the spreading of
fixed expenses across a substantially larger sales base. These operating
improvements resulted in a 20% improvement in both EBITDA and operating EPS."
"Based on the sales trends in our core merchandise categories and the
performance of our new and renovated stores, I am guardedly optimistic about our
prospects for the remainder of the year."
Carson Pirie Scott & Co., a major department store retailer, operates 52
traditional department stores and 4 furniture stores: 31 Carson Pirie Scott
stores in greater Chicago, Indiana and Minnesota; 13 Bergner's in central
Illinois; and 12 Boston Stores in Wisconsin.
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CARSON PIRIE SCOTT & CO. AND SUBSIDIARIES
Consolidated Statements of Operations
(dollars in thousands, except per share amounts)
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Three Months Ended Trailing Twelve Months
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May 3, May 4, May 3, May 4,
1997 1996 1997 1996
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Net sales $258,134 $236,769 $1,124,191 $1,071,225
Cost of sales (167,755) (153,742) (714,093) (684,492)
Selling, general and administrative expenses (76,292) (71,240) (312,185) (296,458)
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EBITDA 14,087 11,787 97,913 90,275
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Depreciation and amortization expense (5,047) (4,032) (16,536) (12,370)
Other 60 (93) 341 126
Nonrecurring items (517) 0 (517) 904
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Income from operations 8,583 7,662 81,201 78,935
Nonrecurring items 0 12,065 (10,525) 5,230
Interest expense, net (4,263) (3,744) (16,429) (17,914)
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Income before income taxes 4,320 15,983 54,247 66,251
Income tax expense (1,711) (6,297) (21,514) (26,404)
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Net income $2,609 $9,686 $32,733 $39,847
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Shares outstanding (in 000's) 16,510 16,800
Net income per share:
Operating $0.18 $0.15
Primary $0.16 $0.58
Fully diluted $0.16 $0.57
Statistics:
Same-store sales increase 4.0% 4.6%
Gross margin rate 35.0% 35.1% 36.5% 36.1%
SG&A rate (29.6%) (30.1%) (27.8%) (27.7%)
EBITDA rate 5.5% 5.0% 8.7% 8.4%
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The Company provided the following highlights for the first quarter results:
1997 First Quarter Results Summary 1996 First Quarter Results Summary
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Net Net Net Net
($ in millions, except EPS) Sales EBITDA Income EPS Sales EBITDA Income EPS
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Operating results <F1> $258.1 $14.1 $2.9 $0.18 $236.8 $11.8 $2.4 $0.15
Nonrecurring Items:
Sales of Proffitt's stock - - - - - - $9.0 0.53
Charitable contribution - - - - - - ($1.5) (0.09)
Year 2000 costs - - ($0.4) (0.02) - - - -
Gain on sale of investment - - $0.1 0.00 - - - -
Write-off of loan fees - - - - - - (0.2) (0.01)
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Total Company $258.1 $14.1 $2.6 $0.16 $236.8 $11.8 $9.7 $0.58
=========================================== =============================================
<FN>
<F1>
(1) Excludes nonrecurring items.
</FN>
Sales: Sales increased 9.0% to $258.1 million in the first quarter of 1997
from the prior year's sales of $236.8 million. Sales rose 4.0% on a comparable-
store basis.
EBITDA: Earnings before interest, taxes, depreciation, amortization and other
non-cash items ("EBITDA") increased 20% to $14.1 million in 1997 from $11.8
million in 1996. The EBITDA rate for the first quarter increased 50 basis points
from 5.0% in 1996 to 5.5% in 1997. The EBITDA improvement resulted from improved
leveraging of fixed expenses across a substantially larger sales base.
Depreciation and amortization: The Company's depreciation and amortization
expense increased from $4.0 million in 1996 to $5.0 million in 1997. The $1.0
million increase resulted from the higher fixed asset balances created through
the Company's capital expenditure program and new store openings. The Company is
anticipating a similar dollar increase to depreciation and amortization expense
in each of the remaining quarters of 1997.
Interest Expense: Interest expense increased to $4.3 million in 1997 from $3.7
million in 1996. The increase occurred because the 1997 results did not include
$0.5 million of interest income recorded in 1996 on an investment in County Seat
Holdings, Inc., which was written down to zero in the third quarter of 1996.
Earnings per share ("EPS") results: Net income excluding nonrecurring items
increased $0.5 million in the quarter versus the prior year first quarter. The
improved EBITDA performance was offset by higher depreciation and interest
charges. Operating EPS improved 20% from $0.15 to $0.18 per share. On a Total
Company basis, EPS was $0.16 in 1997. The $0.02 difference versus operating EPS
of $0.18 related to Year 2000 system preparation costs. Total EPS was $0.58 in
1996 primarily due to a net non-recurring gain from the sale of an investment in
Proffitt's stock.
Page 6 of 8
Share Repurchase Program: During the first quarter, the Company repurchased
150,000 shares of its common stock for $4.5 million under a January 1997 $20
million share repurchase authorization.
Announced Store Opening: The Company announced that it will open a 110,000
square foot Carson Pirie Scott full-line department store in DeKalb, Illinois.
The store will be opened as part of a 680,000 square foot regional mall
development that will be co-anchored by Sears and other proposed co-anchors. The
mall will open in Spring 1999. The Company also announced that it closed its
Hillside, Illinois location during the first quarter of 1997.
Executive Appointments: During the first quarter, two senior executive committee
positions at the Company were filled. Anthony Buccina - Executive Vice President
of Merchandising will report to Stanton Bluestone, Chairman and CEO, and Alan
Noel - Executive Vice President of Human Resources will report to Michael
MacDonald, President and Chief Operating Officer.
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CARSON PIRIE SCOTT & CO. AND SUBSIDIARIES
Consolidated Balance Sheets
(dollars in thousands)
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May 3, May 4,
Assets 1997 1996
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Cash and cash equivalents $ 23,070 $ 34,092
Receivables, net 252,828 223,901
Inventories 204,971 191,641
Other current assets 19,649 20,476
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Total current assets 500,518 470,110
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Property and equipment, net 183,388 145,369
Net deferred tax assets 44,806 40,462
Other assets 11,023 24,823
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$ 739,735 $ 680,764
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Liabilities and Shareholders' Equity
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Current maturities of long-term debt $ 2,867 $ 3,162
Accounts payable and accrued liabilities 177,500 156,718
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Total current liabilities 180,367 159,880
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Other liabilities 47,866 44,828
Accounts receivable securitization 107,800 107,000
Long-term debt, less current maturities 45,463 48,046
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Total liabilities 381,496 359,754
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Shareholders' equity:
Common stock and paid-in-capital 173,855 169,359
Retained earnings 184,384 151,651
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Total shareholders' equity 358,239 321,010
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$ 739,735 $ 680,764
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Net Debt / Capitalization 27.1% 27.9%
Net Debt / Capitalization (excluding A/R debt) 6.6% 5.1%
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