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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1998
Commission File Number
33-88628
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FLORISTS' TRANSWORLD DELIVERY, INC.
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(Exact Name of Registrant as Specified in its Charter)
MICHIGAN 38-0546960
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(State or Other Jurisdiction of (I.R.S. Employer
Incorporation of Organization) Identification No.)
3113 WOODCREEK DRIVE
DOWNERS GROVE, ILLINOIS 60515-5420
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(Address of Principal Executive Offices) (Zip Code)
(630) 719-7800
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(Registrant's Telephone Number, Including Area Code)
Indicate by check whether the registrant (1) has filed all reports
required to be filed by Section 13 and 15(d) of the Securities Exchange Action
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
- -
As of May 1, 1998, there were outstanding 100 shares of the
Registrant's Common Stock, par value $0.01 per share, which is the only class of
Common Stock of the Registrant.
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FLORISTS' TRANSWORLD DELIVERY, INC.
INDEX
PAGE
Part I. Financial Information
Item 1. Financial Statements
Consolidated Condensed Balance Sheets at March 31, 1998
and June 30, 1997 3
Consolidated Condensed Statements of Operations
for the Three and Nine Month periods Ended
March 31, 1998 and 1997 4
Consolidated Condensed Statements of Cash Flows for the
Nine Months Ended March 31, 1998 and 1997 5
Notes to Consolidated Condensed Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
Part II. Other Information 14
Item 6. Exhibits and Reports on Form 8-K
Signatures 15
Exhibit Index 16
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PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
FLORISTS' TRANSWORLD DELIVERY, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
MARCH 31,
1998 JUNE 30,
ASSETS (UNAUDITED) 1997
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(In thousands)
CURRENT ASSETS:
Cash and cash equivalents $4,564 $28,294
Accounts receivable, less allowance for doubtful accounts
of $2,698 at March 31, 1998 and $2,211 at June 30, 1997 30,074 24,979
Inventories, principally finished goods, net 10,805 14,992
Deferred income taxes 7,242 7,242
Other current assets 1,935 2,034
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TOTAL CURRENT ASSETS 54,620 77,541
Property and equipment, less accumulated depreciation
of $29,494 at March 31, 1998 and $23,925 at June 30, 1997 15,438 20,580
OTHER ASSETS:
Deferred financing costs, less accumulated amortization
of $4,595 at March 31, 1998 and $2,724 at June 30, 1997 2,884 3,394
Other noncurrent assets 4,023 1,979
Goodwill and other intangibles, less accumulated amortization
of $9,832 at March 31, 1998 and $7,528 at June 30, 1997 75,927 78,230
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TOTAL OTHER ASSETS 82,834 83,603
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TOTAL ASSETS $152,892 $181,724
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current maturities of long-term debt $ - $9,297
Accounts payable 28,764 31,346
Accrued member incentive programs 13,130 13,816
Accrued severance costs 593 1,245
Other accrued liabilities 9,531 5,759
Members' deposits 10,031 9,991
Unearned income 1,184 2,724
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TOTAL CURRENT LIABILITIES 63,233 74,178
Long-term debt, less current maturities 58,029 73,103
Post-retirement benefits, less current portion 6,577 6,577
Accrued pension obligations, less current portion 497 876
Deferred income taxes 1,488 1,765
Minority interest in subsidiary - 156
STOCKHOLDERS' EQUITY:
Common stock:
Class A
Class B
Paid-in capital 33,000 33,000
Accumulated deficit (9,932) (7,931)
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TOTAL STOCKHOLDERS' EQUITY 23,068 25,069
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $152,892 $181,724
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See accompanying notes to consolidated condensed financial statements.
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FLORISTS' TRANSWORLD DELIVERY, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Nine Months
Ended Ended
March 31, March 31,
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1998 1997 1998 1997
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(In thousands)
REVENUES:
Marketplace $14,751 $18,837 $40,768 $43,531
Clearinghouse 8,629 9,248 25,532 27,088
Mercury Network 8,398 9,298 25,620 27,698
Other 10,409 10,130 28,427 27,905
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Total revenues 42,187 47,513 120,347 126,222
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COSTS:
Products and distribution 11,423 12,354 31,569 30,215
Floral order transmissions and processing services 5,654 7,450 19,278 21,643
Member programs 8,189 7,411 22,430 23,585
-------------- -------------- -------------- --------------
Total cost of goods sold and services
provided 25,266 27,215 73,277 75,443
Selling, general and administrative expense 14,517 13,506 40,451 40,120
-------------- -------------- -------------- --------------
Income from operations 2,404 6,792 6,619 10,659
OTHER INCOME AND EXPENSES:
Interest expense (net of interest income) 2,257 2,847 7,438 8,729
-------------- -------------- -------------- --------------
Net income (loss) before income tax expense
minority interest and extraordinary item 147 3,945 (819) 1,930
Income tax expense 187 1,615 324 1,308
Minority interest in income (loss) of subsidiary - 22 (1) (7)
-------------- -------------- -------------- --------------
Net income (loss) before extraordinary item (40) 2,308 (1,142) 629
EXTRAORDINARY ITEM:
Loss on extinguishment of debt (net of $490 income tax benefit) - - (835) -
-------------- -------------- -------------- --------------
Net income (loss) ($40) $2,308 ($1,977) $629
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See accompanying notes to consolidated condensed financial statements.
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FLORISTS' TRANSWORLD DELIVERY, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Nine Months Nine Months
Ended Ended
March 31, March 31,
1998 1997
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(In thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash provided by operating activities $5,456 $15,580
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital Expenditures (3,634) (2,339)
Net proceeds on sale of Property, Plant & Equipment 578 -
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Net cash used in investing activities (3,056) (2,339)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds of revolving credit borrowings 28,546 -
Repayments of long-term debt (54,652) (5,751)
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Net cash used in financing activities (26,106) (5,751)
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Effect of exchange rate changes on cash (24) (62)
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NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS (23,730) 7,428
CASH AND CASH EQUIVALENTS:
BEGINNING OF PERIOD 28,294 26,536
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END OF PERIOD $4,564 $33,964
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SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Interest paid $5,283 $6,610
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Income taxes paid $107 $194
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See accompanying notes to consolidated condensed financial statements.
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FLORISTS' TRANSWORLD DELIVERY, INC.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1. Basis of Presentation
The unaudited consolidated condensed financial statements at
March 31, 1998, include the accounts of Florists' Transworld Delivery,
Inc. (the "Company" or "FTD"). These financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information pursuant to the rules and regulations of the Securities and
Exchange Commission and do not contain all information included in the audited
consolidated financial statements and notes for the year ended June 30, 1997.
The interim financial statements should be read in conjunction with the
financial statements and notes thereto included in the Company's latest Annual
Report on Form 10-K. In the opinion of FTD management, all adjustments
necessary for a fair presentation of the financial position and results of
operations have been included (and any such adjustments are of a normal,
recurring nature, except as disclosed herein). Due to seasonal variations in
FTD's business, operating results for the three and nine month periods ended
March 31, 1998 are not necessarily indicative of the results that might be
expected for the year ended June 30, 1998.
Certain amounts in the March 31, 1997 consolidated condensed financial
statements have been reclassified to conform to the current period presentation.
Note 2. Accrued Severance and Related Costs
The following table reflects the changes to accrued severance, asset
impairment loss, and other reserves relating to the Company's facility
consolidation for the nine month period ended March 31, 1998 (in thousands):
Severance Relocation
Benefits Costs Other Total
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Liability as of June 30, 1997 $792 $119 $334 $1,245
Costs paid during the nine month period ended
March 31, 1998 $498 $26 $128 $652
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Liability as of March 31, 1998 $294 $93 $206 $593
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Note 3. Employee Benefit Obligations
Effective January 1, 1997, amendments to FTD's defined benefit pension
plan were adopted, including the elimination of the accrual of future benefits
under the plan. As a result of these amendments, and the corresponding
remeasurement of the accumulated and projected benefit obligations under the
plan, a pre-tax pension curtailment gain of $0.5 million was recognized through
a reduction in selling, general and administrative costs during the nine month
period ended March 31, 1998.
Note 4. Extinguishment of Long-Term Debt
In November, 1997 FTD entered into a new credit agreement with First
Chicago Capital Markets, Inc. who arranged a $100 million financing package
("the Bank Credit Facilities") with The First National Bank of Chicago acting as
Administrative Agent. The Bank Credit Facilities consist of a $50 million
Revolving Credit Facility and a $50 million Multiple Draw Term Loan Facility,
both maturing on December 31, 2003. The proceeds of the Revolving Credit were
used to provide funds for the refinancing of then existing debt totaling $24.6
million. As a result of entering into the Bank Credit Facilities, $1.3 million
of unamortized deferred financing costs associated with then existing debt were
expensed in November 1997. The related income tax benefit attributable to the
extinguishment of the existing debt was $0.5 million, resulting in a net loss on
extinguishment of debt of $0.8 million which is reflected as an extraordinary
item in the consolidated condensed statements of operations.
Note 5. New Accounting Pronouncements
The Accounting Standards Executive Committee of the American Institute
of Certified Public Accountants issued Statement of Position ("SOP") 98-1
"Accounting for the Costs of Computer Software Developed or Obtained for
Internal Use" on March 4, 1998. This SOP applies to all non-governmental
entities and is effective for financial statements for fiscal years beginning
after December 15, 1998. The Company intends to adopt this SOP in the fourth
quarter of fiscal 1998 when it begins incurring substantial costs related to
the implementation of its new computer software package.
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Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Except for the historical information contained in this report,
certain statements made herein are forward-looking statements that reflect the
Company's expectations regarding its future growth, results of operations,
performance and business prospects and opportunities. Words such as
"anticipates," "believes," "plans," "expects," "estimates," and similar
expressions have been used to identify these forward looking statements, but
are not the exclusive means of identifying these statements. These statements
reflect the Company's current beliefs and are based on information currently
available to the Company. Accordingly, these statements are subject to known
and unknown risks, uncertainties and other factors that could cause the
Company's actual growth, results, performance and business prospects and
opportunities to differ from those expressed in, or implied by, these
statements. These risks, uncertainties and other factors include the Company's
ability to develop and market existing and acquired products, the Company's
ability to adjust to changes in technology, customer preferences, enhanced
competition and new competitors in the floral services industry, current
exchange rate fluctuations, collection of receivables and risks associated with
general economic and business conditions, which may reduce or delay customers'
purchases of the Company's products and services. The Company is not obligated
to update or revise these foward-looking statements to reflect new events or
circumstances.
FTD generates its revenue from four principal areas of operation.
Marketplace represents FTD's wholesale distribution of hardgoods to retail
florists in North America. FTD's Clearinghouse operation provides order billing
and collection services to both the sending and receiving florists, and FTD
receives a percentage of the sales price for this service. Mercury Network is
FTD's proprietary telecommunications network used by florists to transmit orders
through FTD or through competing clearinghouses. Other revenue is derived from
the 1-800-SEND-FTD direct marketing business, FTD's Florists' Online Internet
site (www.ftd.com), credit card authorization and processing, publications
and FTD's Flowers After Hours order taking service.
THREE MONTH PERIOD ENDED MARCH 31, 1998, COMPARED TO THREE MONTH PERIOD
ENDED MARCH 31, 1997
The following is a discussion of changes in the Company's financial
condition and results of operations for the three month period ended March 31,
1998, compared with the three month period ended March 31, 1997.
Revenue decreased by $5.3 million, or 11.2%, to $42.2 million for the
three month period ended March 31, 1998, compared to $47.5 million for the three
month period ended March 31, 1997. This decrease in revenue was primarily the
result of decreases in Marketplace, Clearinghouse and Mercury Network revenue
offset, in part, by an increase in Other revenue.
Marketplace revenue decreased by $4.1 million, or 21.8%, to $14.7
million for the three month period ended March 31, 1998 compared to $18.8
million for the three month period ended March 31, 1997. This decrease is
primarily due to the earlier shipment of Valentines Day holiday product to
customers which occurred in the second quarter of fiscal 1998 as compared to the
third quarter in fiscal 1997. Marketplace revenue was 34.8% and 39.6% of total
revenue for the three months ended March 31, 1998 and 1997, respectively.
Clearinghouse revenue decreased by $0.6 million, or 6.5%, to $8.6
million for the three month period ended March 31, 1998 from $9.2 million for
the three month period ended March 31, 1997. This decrease is primarily due to a
decrease in clearinghouse advances due to the timing of the Easter holiday from
the comparable period of the prior year.
Mercury Network revenue decreased by $0.9 million, or 9.7%, to $8.4
million for the three months ended March 31, 1998 from $9.3 million for the
three month period ended March 31, 1997.
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This decrease is primarily due to a decrease in sales of Advantage Business
Systems and a decrease in transmissions income as a result of the timing of
the Easter holiday from the comparable period of the prior year.
Other revenue increased by $0.3 million, or 3.0%, to $10.4 million for
the three month period ended March 31, 1998 from $10.1 million for the three
month period ended March 31, 1997. This increase is primarily due to an increase
in the monthly fee charged to FTD member florists of $0.6 million partially
offset by a decrease of $0.2 million relating to FTD's direct marketing
business.
The cost of goods sold and services provided decreased by $1.9 million,
or 7.0%, to $25.3 million for the three month period ended March 31, 1998 from
$27.2 million for the three month period ended March 31, 1997. This decrease is
primarily a result of a decrease in product and distribution costs and floral
order transmissions and processing services partially offset by an increase in
costs relating to member programs. As a percent of revenue, cost of goods sold
and services provided increased 2.7% to 60.0% for the three month period ended
March 31, 1998 from 57.3% for the three month period ended March 31, 1997. Cost
of goods sold and services provided is a greater percent of revenue for the
three months ended March 31, 1998 as compared to the three months ended March
31, 1997 as a result of a reduced gross margin in FTD's effort to offer
competitively priced products to FTD member florists.
Product and distribution costs decreased $0.9 million, or 7.3%, to
$11.4 million for the three month period ended March 31, 1998 from $12.3
million for the three month period ended March 31, 1997. This decrease is
primarily the result of proportionately lower cost of goods sold relating to
decreases in Marketplace holiday-product sales and decreases in the related
distribution costs due to the earlier shipments of Valentines Day holiday
product to customers. In the comparable period of the prior year, Valentines
Day holiday product shipped to customers during the third quarter which
increased the length of time that FTD possessed the product and therefore
increased the costs FTD incurred for storage and distribution.
Costs relating to floral order transmissions and processing services
decreased $1.8 million, or 24.0%, to $5.7 million for the three month period
ended March 31, 1998 from $7.5 million for the three month period ended March
31, 1997. This decrease is primarily attributable to a decrease in depreciation
expense relating to fully depreciated equipment as of the third quarter of
fiscal 1998.
Costs relating to member programs increased $0.8 million, or 10.8%, to
$8.2 million for the three month period ended March 31, 1998 from $7.4 million
for the three month period ended March 31, 1997. This increase is primarily due
to an increase in base order dollars earned by member florists who participate
in FTD's member incentive program as well as an increase in administrative
expenses associated with the member incentive program.
Selling, general and administrative expense increased $1.0 million, or
7.4%, to $14.5 million for the three month period ended March 31, 1998
from $13.5 million for the three month period ended March 31, 1997. This
increase is primarily due to increased costs associated with data processing,
field services and human resources as well as $0.5 million less in pre-tax
pension curtailment credits during the third quarter of fiscal 1998 as compared
to the third quarter of fiscal
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1997.
Net interest expense for the three month period ended March 31, 1998
was $2.3 million as compared to $2.8 million for the three month period ended
March 31, 1997. The decrease of $0.5 million was attributable to lower average
debt outstanding as well as lower average interest rates resulting from the
implementation of a new credit agreement which became effective in November 1997
(see Liquidity and Capital Resources).
Income taxes for the three month period ended March 31, 1998 were an
expense of $0.2 million compared to an expense of $1.6 million for the
comparable three month period ended March 31, 1997. This change resulted from
the decrease in taxable income.
Net loss was $0.04 million for the three month period ended March 31,
1998, a decrease of $2.34 million, from a profit of $2.3 million for the three
month period ended March 31, 1997. The change is attributable to the factors
previously discussed.
NINE MONTHS ENDED MARCH 31, 1998 COMPARED TO NINE MONTHS ENDED MARCH 31, 1997
The following is a discussion of the changes in the Company's financial
condition and results of operations for the nine month period ended March 31,
1998, compared with the nine month period ended March 31, 1997.
Revenue decreased $5.9 million, or 4.7%, to $120.3 million for the
nine month period ended March 31, 1998, compared to $126.2 million for the nine
month period ended March 31, 1997. This decline in revenue is primarily due to
decreases in Marketplace, Clearinghouse and Mercury Network revenue offset, in
part, by an increase in Other revenue.
Marketplace revenue decreased $2.7 million, or 6.2%, to $40.8 million
for the nine month period ended March 31, 1998 from $43.5 million for the nine
month period ended March 31, 1997. This decrease is primarily due to the lower
sales volume of holiday product.
Clearinghouse revenue decreased $1.6 million, or 5.9%, to $25.5 million
for the nine month period ended March 31, 1998 from $27.1 million for the nine
month period ended March 31, 1997. This decrease in revenue is primarily due to
decreases in clearinghouse advances.
Mercury Network revenue decreased by $2.1 million, or 7.6%, to $25.6
million for the nine month period ended March 31, 1998 from $27.7 million for
the nine month period ended March 31, 1997. This decrease in revenue is
primarily due to decreases in sales of Advantage Business Systems, floral order
transmissions and mercury console rental revenue.
Other revenue increased $0.5 million, or 1.8%, to $28.4 million for the
nine month period ended March 31, 1998 from $27.9 million for the nine month
period ended March 31, 1997. This is primarily due to an increase in the monthly
fee charged to FTD member florists.
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The cost of goods sold and services provided decreased $2.1 million, or
2.8%, to $73.3 million for the nine months ended March 31, 1998 from $75.4
million for the nine months ended March 31, 1997. This is primarily due to
decreased costs relating to floral order transmissions and processing services
and member programs offset, in part, by an increase in product and distribution
costs. As a percent of revenue, cost of goods sold and services provided
increased 1.2% to 60.9% for the nine month period ended March 31, 1998 from
59.7% for the nine month period ended March 31, 1997.
Costs relating to floral order transmissions and processing services
decreased $2.4 million, or 11.1%, to $19.3 million for the nine month period
ended March 31, 1998 from $21.6 million for the nine month period ended March
31, 1997. This decrease is primarily attributable to a decrease in depreciation
expense relating to fully depreciated equipment as of the third quarter of
fiscal 1998.
Costs relating to member programs decreased $1.2 million, or 5.1%, to
$22.4 million for the nine month period ended March 31, 1998 from $23.6 million
for the nine month period ended March 31, 1997. This is primarily due to
decreased costs associated with the FTD Directory being published on a quarterly
basis in fiscal 1998 versus five times per year in fiscal 1997. The FTD
Directory was published three times in the nine month period ended March 31,
1998 as compared to four times in the nine month period ended March 31, 1997.
Product and distribution costs increased $1.4 million, or 4.6%, to
$31.6 million for the nine month period ended March 31, 1998 from $30.2 million
for the nine month period ended March 31, 1997. This increase is primarily due
to increased costs associated with the Marketplace branded product line.
Selling, general and administrative expense increased by $0.4
million, or 0.7%, to $40.5 million for the nine month period ended
March 31, 1998 from $40.1 million for the nine month period ended March 31,
1997. This increase is primarily attributable to an increase in consumer
advertising as compared to the same period of the prior year.
Net interest expense for the nine months ended March 31, 1998 was $7.4
million as compared to $8.7 million in the comparable period of the prior year.
The decrease is attributable to lower average debt outstanding as well as lower
average interest rates resulting from the implementation of a new credit
agreement which became effective in November, 1997 (see Liquidity and Capital
Resources).
Income taxes for the nine month period ended March 31, 1998 were an
expense of $0.3 million as compared to an expense of $1.3 million in the
comparable period of the prior year. The income tax expense of $0.3 million for
the nine month period ended March 31, 1998 consists of a benefit of $0.5 million
relating to the extinguishment of long-term debt (see Liquidity and Capital
Resources), partially offset by $0.2 million of income tax benefit due to the
change in taxable income.
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Net loss increased $2.6 million to $2.0 million for the nine month
period ended March 31, 1998 as compared to a net profit of $0.6 million for the
nine month period ended March 31, 1997. The change is attributable to the
factors previously discussed.
LIQUIDITY AND CAPITAL RESOURCES
Interest payments on the Company's $60.0 million aggregate principal
amount of 14% Senior Subordinated Notes (the "Notes") and interest
under the Bank Credit Facilities represent significant liquidity requirements
for FTD. Borrowings under the Bank Credit Facilities bear interest at floating
rates and require interest payments on varying dates depending on the interest
rate option selected by FTD. Borrowings available under the Bank Credit
Facilities consist of a $50.0 million Multiple Draw Term Loan Facility ( the
"Term Loan Facilities") and a $50.0 million Revolving Credit Facility ( the
"Revolving Credit Facilities") to finance working capital, acquisitions,
certain expenses and letter of credit needs. FTD repaid $24.6 million of
existing loans thereunder in the nine month period ended March 31, 1998. At
March 31, 1998, the Company did not have any borrowings outstanding under the
Revolving Credit Facilities. Any loan outstanding under the Revolving Credit
Facilities will mature on December 31, 2003. The Company believes, based on
current circumstances, that its cash flow, together with borrowings under the
Revolving Credit Facilities, will be sufficient to fund its working capital
needs, capital expenditures, and potential acquisitions, and to repay the term
loans and make interest payments as they become due through the term of the
Notes and the Bank Credit Facilities.
The Company has conducted a review of its computer systems and has
identified the systems that could be affected by the "Year 2000" issue. The
year 2000 issue is the result of computer programs being written using two
digits rather than four to define the applicable year. Any of the Company's
programs that have time-sensitive software may recognize a date using "00" as
the year 1900 rather than the year 2000. This could result in a major system
failure or miscalculations. As of March 31, 1998, FTD has contracted with an
outside consulting firm which has assisted FTD in the evaluation and selection
of a compatible software package based on FTD's system requirements. FTD is
currently developing an implementation and training schedule to have the
software package installed on a timely basis. This new software package will
allow the Company to improve its execution and efficiencies in recording
information in addition to providing a solution for the year 2000 issue.
During the implementation of the software package the Company will
incur internal staff costs as well as consulting and other costs. The total
cost of the software system project as well as the related potential effect on
the Company's earnings is not expected to have a material effect on its
financial position or results of operations. The total estimated cost to
complete the project over the next twelve to eighteen months is expected to
range between $10.0 and $12.0 million of which approximately $8.0 to $10.0
million of these expenditures are expected to be capital expenditures. The
capitalized items include costs related to hardware, software and other
external direct costs of material and services consumed in developing or
obtaining the internal-use computer software.
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Capital expenditures were budgeted to be $5.0 million for fiscal 1998.
For the nine month period ended March 31, 1998 capital expenditures totaled
$3.7 million and consist primarily of the acquisition of a marketing license to
advertise through a search engine on the Internet.
For the nine month period ended March 31, 1998, FTD used cash in the
amount of $23.7 million, as compared to a $7.4 million increase in cash for the
nine month period ended March 31, 1997.
Cash provided by operating activities was $5.5 million for the nine
month period ended March 31, 1998, compared to cash provided by operating
activities of $15.6 million for the nine month period ended March 31, 1997.
Depreciation and amortization was $8.5 million for the nine month period ended
March 31, 1998, and $10.7 million for the nine month period ended March 31,
1997. The decrease in cash is primarily due to the timing of the Easter holiday
credit card transactions which during the comparable period of the prior year
caused a decrease in accounts receivable and an increase in accounts payable of
FTD's floral customers.
Cash used in investing activities, consisting of capital expenditures
net of disposal of assets, was $3.1 million for the nine month period ended
March 31, 1998 compared to $2.3 million for the nine month period ended March
31, 1997. This increase is primarily due to the purchase of a marketing license
during the third quarter of fiscal 1998.
Net cash used in financing activities for the nine month period ended
March 31, 1998 was $26.1 million compared to net cash used of $5.8 million for
the nine month period ended March 31, 1997. This increase primarily consists of
$28.5 million of net proceeds of long-term debt as a result of the new Bank
Credit Facilities and repayments of $54.6 million of principal on the term
loans.
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PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
Exhibit No. Description
- ----------- -----------
(a) Exhibits
27 Financial Data Schedule
(b) Reports on Form 8-K
FTD did not file any reports on Form 8-K during the three month period
ended March 31, 1998.
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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 thereunto duly authorized on the 11th day of May, 1998.
FLORISTS' TRANSWORLD DELIVERY, INC.
By: /s/ Francis C. Piccirillo
-------------------------
Francis C. Piccirillo
Vice President and Chief Financial Officer
(Principal financial officer and officer duly
authorized to sign on behalf of registrant)
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EXHIBIT INDEX
Paper (P)
or
Exhibit Description Electronic (E)
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27 Financial Data Schedule E
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