UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from...........to....................
Commission file number.............333-18755............................
..............................Pluma, Inc.................
(Exact name of registrant as specified in its charter)
North Carolina 56-1541893
(State or other jurisdiction of incorporation (I.R.S. Employer
or organization) Identification No.)
...................................................................
(Address of principal executive offices)
(Zip Code)
.....................801 Fieldcrest Road, Eden, North Carolina 27289.........
(Registrant's telephone number, including area code)
...............................(336) 635-4000.................................
(Former name, former address and former fiscal year,
if changed since lastreport)
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 (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.......
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date 8,109,152 shares of common
stock, no par value, as of August 11, 1998.
1
PLUMA, INC.
INDEX TO FORM 10-Q
- ------------------------------------------------------------------------------
PART I - FINANCIAL INFORMATION PAGE
Item 1. Financial Statements
Balance Sheets - June 30, 1998 and December 31, 1997 3
Statements of Operations - Three Months and Six Months
Ended June 30, 1998 and 1997 4
Statements of Cash Flows - Six Months Ended June 30, 1998
and 1997 5
Notes to Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 8
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 11
2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
PLUMA, INC.
BALANCE SHEETS
- --------------------------------------------------------------------------------
(UNAUDITED)
JUNE 30, DECEMBER 31,
1998 1997
ASSETS
Current assets:
Cash $ 1,234,256 $ 1,875,992
Accounts receivable (less allowance -
1998, $2,358,044; 1997, $2,353,577) 38,196,397 32,001,332
Refundable income taxes 2,578,844 1,952,796
Other receivables - 1,906,178
Deferred income taxes 1,259,461 1,539,385
Inventories 64,280,472 51,177,900
Other current assets 920,479 1,168,663
-------------- ------------
Total current assets 108,469,909 91,622,246
-------------- ------------
Property, plant and equipment:
Land 929,689 929,689
Land improvements 719,699 719,699
Buildings and improvements 16,737,550 16,663,608
Machinery and equipment 39,199,987 36,420,561
Construction in process 9,897,381 4,762,235
-------------- -------------
Total property, plant and equipment 67,484,306 59,495,792
Less accumulated depreciation 23,481,000 21,496,857
-------------- -------------
Property, plant and equipment, net 44,003,306 37,998,935
-------------- -------------
Other assets:
Goodwill (less accumulated amortization -
1998, $898,112; 1997, $26,655 33,960,189 34,831,646
Other 2,451,949 1,533,840
-------------- -------------
Total other assets 36,412,138 36,365,486
-------------- -------------
Total $ 188,885,353 $ 165,986,667
============== =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt 100,727,000 44,117,982
Accounts payable 18,809,426 12,057,069
Accrued expenses 4,390,334 2,472,458
-------------- -------------
Total current liabilities 123,926,760 58,647,509
-------------- -------------
Long-term debt - 40,000,000
-------------- -------------
Deferred income taxes 3,890,715 3,671,301
-------------- -------------
Commitments and contingencies
Shareholders' equity:
Preferred stock, no par value, 1,000,000
shares authorized
Common stock, no par value, 15,000,000
shares authorized, shares issued and
outstanding - 1998, 8,109,152;
1997, 8,109,152 36,849,127 36,849,127
Retained earnings 24,218,751 26,818,730
-------------- -------------
Total shareholders' equity 61,067,878 63,667,857
-------------- -------------
Total $ 188,885,353 $ 165,986,667
============== =============
The accompanying notes are an integral part of these statements.
3
PLUMA, INC.
STATEMENTS OF OPERATIONS
- -------------------------------------------------------------------------------------------------
(UNAUDITED) (UNAUDITED)
THREE MONTHS SIX MONTHS
ENDED JUNE 30, ENDED JUNE 30,
1998 1997 1998 1997
Net sales $ 51,059,701 $ 33,226,268 $ 90,256,136 $ 60,511,998
Cost of goods sold 46,428,171 28,053,506 81,610,435 50,646,665
------------- ------------- ------------- -----------
Gross profit 4,631,530 5,172,762 8,645,701 9,865,333
Selling, general and administrative expenses 5,185,240 2,531,845 9,018,065 5,305,472
------------- ------------- ------------- -----------
Income (loss) from operations (553,710) 2,640,917 (372,364) 4,559,861
------------- ------------- ------------- -----------
Other income (expenses):
Interest expense (1,862,555) (500,193) (3,330,837) (1,178,172)
Amortization of goodwill (435,729) - (871,457) -
Other income, net 150,270 122,925 486,640 249,739
------------- ------------- ------------- -----------
Total other expenses, net (2,148,014) (377,268) (3,715,654) (928,433)
------------- ------------- ------------- -----------
Income (loss) before income taxes (2,701,724) 2,263,649 (4,088,018) 3,631,428
------------- ------------- ------------- -----------
Income taxes (benefit) (983,428) 833,022 (1,488,039) 1,336,366
------------- ------------- ------------- -----------
Net income (loss) $ (1,718,296) $ 1,430,627 $ (2,599,979) $ 2,295,062
============= ============ ============= ===========
Earnings (loss) per common share -
basic and diluted $ (.21) $ .18 $ (.32) $ .33
============= ============ ============= ===========
Weighted average number of shares outstanding 8,109,152 8,067,252 8,109,152 6,989,208
============= ============ ============= ===========
The accompanying notes are an integral part of this statement.
4
PLUMA, INC.
STATEMENTS OF CASH FLOWS
- ------------------------------------------------------------------------------------------
(UNAUDITED)
SIX MONTHS ENDED
JUNE 30,
1998 1997
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (2,599,979) $ 2,295,062
Adjustments to reconcile net income (loss) to
net cash used in operating activities:
Provision for depreciation 2,142,293 2,005,474
Provision for amortization 921,459 -
Other, net 9,622 (1,162)
Increase in accounts receivable (6,195,065) (10,269,022)
Decrease in other receivables 1,906,178 -
Increase (decrease) in deferred income taxes 499,338 (169,050)
Increase in inventories (13,102,572) (6,259,414)
(Increase) decrease in other current assets 248,184 471,845
Increase in accounts payable 6,752,357 2,349,832
(Increase) decrease in refundable income taxes (626,048) (547,584)
Increase in accrued expenses 1,917,876 1,018,742
------------ -----------
Net cash used in operating activities (8,126,357) (9,105,277)
------------ -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment (8,156,286) (5,475,838)
Other, net (968,111) (145,569)
------------ -----------
Net cash used in investing activities (9,124,397) (5,621,407)
------------ -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of long-term debt (849,640) (849,640)
Proceeds from issuance of long-term debt 58,727,000 326,155
Net repayments of revolving loan (41,268,342) (14,431,768)
Net proceeds from sale of common stock - 29,663,978
Payment of dividends - (144,451)
------------ -----------
Net cash provided by financing activities 16,609,018 14,564,274
------------ -----------
Net decrease in cash (641,736) (162,410)
Cash, beginning of period 1,875,992 291,488
------------ -----------
Cash, end of period $ 1,234,256 $ 129,078
============ ===========
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest $ 2,591,774 $ 1,448,773
Income taxes 57,500 2,053,000
Cash received during the period for:
Income taxes $ 1,400,829 -
The accompanying notes are an integral part of these statements.
5
PLUMA, INC.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED) JUNE 30, 1998
- --------------------------------------------------------------------------------
1. ACCOUNTING POLICIES
The accompanying unaudited financial statements of Pluma, Inc. (the
"Company") have been prepared in accordance with generally accepted
accounting principles for interim periods.
In the opinion of management, these financial statements include all
adjustments, including all normal recurring accruals, necessary for a fair
presentation of the financial position at June 30, 1998 and December 31,
1997, the results of operations for the three months and six months ended
June 30, 1998 and 1997 and cash flows for the six months ended June 30, 1998
and 1997.
The operating results for the three months and six months ended June 30,
1998 are not necessarily indicative of the results to be expected for the
full year ending December 31, 1998.
In December 1997, the Company purchased certain assets and assumed certain
liabilities of Stardust Corporation ("Stardust") and Frank L. Robinson
Company ("FLR"). The acquisitions have been accounted for as purchases.
Accordingly, the assets, liabilities, revenues and expenses of the acquired
businesses are included in the financial statements as of December 31, 1997,
and for the three months and six months ended June 30, 1998.
2. INVENTORIES
Inventories consist of the following:
(UNAUDITED)
JUNE 30, DECEMBER 31
1998 1997
At FIFO cost:
Raw materials $ 1,633,508 $ 1,429,371
Work-in-progress 8,804,563 6,077,538
Finished goods 56,746,004 45,885,484
Production supplies 1,268,780 953,147
---------- -----------
68,452,855 54,345,540
Excess of FIFO over LIFO cost (2,394,616) (1,846,435)
=========== ===========
66,058,239 52,499,105
Excess of cost over market (1,777,767) (1,321,205)
----------- -----------
$64,280,472 $51,177,900
=========== ===========
3. CAPITAL STOCK
On January 28, 1997, the Board of Directors declared a 0.736-for-one reverse
common stock split for shareholders of record on February 3, 1997. All
references in the accompanying financial statements to the number of common
shares and per share amounts reflect the reverse stock split.
6
In March 1997, the Company completed its initial public offering of
2,500,000 shares of Common Stock at $12.00 per share. The $26,416,906 net
proceeds were used to reduce debt.
In April 1997, the Underwriters' over-allotment option for 293,300 shares of
Common Stock at $12.00 per share was exercised. The $3,209,671 net proceeds
were used to reduce debt.
4. STOCK OPTIONS
In May 1995, the Company adopted the 1995 Stock Option Plan in which 515,200
shares of the Company's Common Stock may be issued. The exercise price of
the options may not be less than the fair value of the Common Stock on the
date of grant. The options granted become exercisable at such time or times
as shall be determined by the Compensation Committee of the Board of
Directors (the "Committee"). The Committee may at any time accelerate the
exercisability of all or any portion of any stock option. These options
expire, if not exercised, ten years from the date of grant. Participants in
the Plan may be independent contractors or employees of independent
contractors, full or part-time officers and other employees of the Company,
or independent directors of the Company.
In April 1996 and October 1995, the Company granted 32,384 and 379,776
options, respectively, to purchase Common Stock at an exercise price of
$13.077 per share of which 181,352 and 180,763 options are exercisable as of
June 30, 1998 and December 31, 1997, respectively. Forfeited options were
40,627 as of June 30, 1998 and 31,795 as of December 31, 1997. Expired
options were 6,477 shares as of June 30, 1998 and 589 shares as of December
31, 1997. The remaining 183,704 options become exercisable on the
anniversary dates of the grants as follows:
YEAR SHARES
1998 54,759
1999 61,236
2000 61,234
2001 6,475
-------
Total 183,704
=======
The Company applies APB Opinion No. 25 and related interpretations in
accounting for the 1995 Stock Option Plan. Accordingly, no compensation cost
has been recognized since the exercise price approximates the fair value of
the stock price at the grant dates. Had compensation cost been determined
based on the fair value at the grant date consistent with the method of
Statement of Financial Accounting Standards No. 123, "Accounting for
Stock-Based Compensation," the Company's net income and earnings per common
share would have been effected for the three months ended March 31, 1998 and
1997 as indicated below:
THREE MONTHS SIX MONTHS
ENDED JUNE 30, ENDED JUNE 30,
1998 1997 1998 1997
Net Income:
As reported $(1,718,296) $1,430,627 $(2,599,979) $2,295,062
Pro forma $(1,746,466) $1,379,313 $(2,658,740) $2,192,435
Earnings per Share:
7
As reported $ (.21) $ .18 $ (.32) $ .33
Pro forma $ (.22) $ .17 $ (.33) $ .31
5. EARNINGS PER COMMON SHARE
In February 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 128, "Earnings per Share" ("SFAS 128")
which changes the method of computing and presenting earnings per share.
SFAS 128 requires the presentation of basic earnings per share and diluted
earnings per share ("EPS") on the face of the income statement for all
entities with complex capital structures and requires a reconciliation of
the numerator and denominator of the basic EPS computation to the numerator
and denominator of the diluted EPS computation. Basic earnings per share is
computed by dividing the net income available to common shareholders by the
weighted average shares of outstanding common stock. The calculation of
diluted earnings per share is similar to basic earnings per share except
that the denominator includes dilutive common stock equivalents such as
stock options and warrants. SFAS 128 is effective for financial statements
for periods ending after December 15, 1997 and early adoption is not
permitted.
Outstanding options to purchase shares of common stock were not included in
the computation of diluted EPS because the options' exercise prices were
greater than the average market prices of the common shares during the three
months and six months ended June 30, 1998 and 1997. Accordingly, there were
no differences in the numerators and denominators used in the basic EPS and
diluted EPS computations.
6. LONG-TERM DEBT
In April 1998, the Company replaced its existing debt with a $115.0 million
syndicated credit facility (the "Syndicated Credit Facility"). The
Syndicated Credit Facility permits revolving loans of up to $70.0 million
(the "Revolving Loans") and term loans of up to $45.0 million (the "Term
Loans"). Any amounts outstanding under the Revolving Loans mature in April,
2003. Term Loan borrowings will be due in specified quarterly installments
beginning in April, 1999 with a final maturity in January, 2003.
Among the various provisions, limitations and restrictions contained in the
Syndicated Credit Facility, the Company must meet specified consolidated net
worth, leverage ratio, fixed charge coverage ratio, funded debt to total
capitalization ratio and consolidated earnings before the effect of interest
expense, income taxes depreciation and amortization requirements. Under the
Syndicated Credit Facility, the Company is restricted in the amount of its
capital expenditures, indebtedness to certain other parties, payment of
dividends, or redemption of its stock that would create an event of default.
In the event of default, unless a waiver is obtained, any unpaid principal
and accrued interest may be declared immediately due and payable. The
Syndicated Credit Facility may be terminated at any time upon the occurrence
of an event of default. The Company retains the right to remedy certain
events of default within 30 days after notice. The Company was not in
compliance with certain covenants and had not obtained the respective
waivers as of June 30, 1998. Accordingly, all debt as of June 30, 1998 has
been classified as current.
7. NEW ACCOUNTING STANDARDS
In June 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 130, "Comprehensive Income" ("SFAS 130"),
which established standards for the reporting and display of comprehensive
income and its components in a full set of general-purpose financial
statements. This statement divides comprehensive income into net income and
other comprehensive income. For the three months and six months ended June
30, 1998 and 1997, the Company had no items of other comprehensive income.
In June 1997, SFAS No. 131 "Disclosures about Segments of an Enterprise and
Related Information," was issued, establishing standards for the way public
enterprises report information about operating segments in annual financial
statements. This statement also requires that those enterprises report
selected information about operating segments in interim financial reports
issued to shareholders. The Company will be required to apply the provisions
of this statement beginning with the annual report issued for the year
ending December 31, 1998.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
8
GENERAL
The following discussion and analysis should be read in conjunction with the
financial statements and related notes of this Quarterly Report on Form 10-Q
and should be read in conjunction with the Company's 1997 Annual Report.
RESULTS OF OPERATIONS
The following table presents the major components of the Company's Statement
of Operations as a percentage of net sales:
(UNAUDITED) (UNAUDITED)
THREE MONTHS SIX MONTHS
ENDED JUNE 30, ENDED JUNE 30,
1998 1997 1998 1997
Net sales 100.0% 100.0% 100.0% 100.0%
Cost of goods sold 90.9 84.5 90.4 83.7
------ ------- ------- -------
Gross profit 9.1 15.5 9.6 16.3
Selling, general and
administrative expenses 10.1 7.6 10.0 8.7
------ ------- ------- -------
Income (loss) from operations (1.0) 7.9 (.4) 7.6
Other expenses, net (4.2) (1.1) (4.1) (1.5)
------ ------- ------- -------
Income (loss) before income taxes (5.2) 6.8 (4.5) 6.1
Income taxes (benefit) (1.9) 2.5 (1.6) 2.2
------ ------- ------- -------
Net income (loss) (3.3)% 4.3% (2.9)% 3.9%
====== ======= ======= =======
THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 1998 ("1998"), COMPARED TO THREE
MONTHS AND SIX MONTHS ENDED JUNE 30, 1997 ("1997")
NET SALES
Net sales for the six months ended June 30, 1998 were $90.3 million, an
increase of $29.8 million, or 49.2%, over net sales of $60.5 million for the
first six months of 1997. This increase in net sales was attributable to the
inclusion of sales from FLR and Stardust which were acquired by the Company
in December of 1997. However, sales from these divisions were lower than
anticipated due to a temporary disruption of inventory supply to them.
GROSS MARGINS Gross Margins declined to 9.1% and 9.6% for the second quarter
and first six months of 1998, respectively, from 15.5% and 16.3% in the
comparable periods of 1997. The decline was the result of higher than
anticipated manufacturing expenses including lower fabric yield, a shift in
product mix, and an increase in supplies expense. Fabric yield was adversely
impacted due to problems associated with system design and procedural
aspects of the SAP management information system which is currently being
implemented by the Company resulting in excess waste. Steps have been or are
being taken to correct this problem. Orders for product shifted to a higher
percentage of larger sized goods during the second quarter of 1998 relative
to the same period in 1997. Due to a competitive market environment, the
Company is not always able to offset the higher production costs associated
with larger sized product with higher selling prices. In addition, the
Company sold a higher percentage of jersey relative to fleece product during
the first six months of 1998 compared to the same period of 1997. Jersey
product, on average, provides a lower gross profit percentage than fleece
product. Supplies expense increased as the Company provided
9
manufacturing and shipping supplies to a greater number of outside
contractors during the second quarter of 1998 than had been utilized in
the same period of 1997.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES ("SG&A")
For the first six months, SG&A expenses increased 69.8% to $9.0 million in
1998 from $5.3 million in 1997. SG&A as a percentage of sales for 1998 was
10.0% compared to 8.7% in 1997. This increase in SG&A expense is primarily
attributable to the inclusion of expenses from FLR and Stardust in the first
six months of 1998.
OTHER EXPENSES, NET
Other expenses, net, increased 425% to $2.1 million in the second quarter of
1998 and 311.1% to $3.7 million in the first six months of 1998. This
increase was due to an increase in interest expense and amortization expense
associated with the acquisitions made in December of 1997.
INCOME TAXES
The effective tax rate was 36.4% in 1998 and 36.8% in 1997.
LIQUIDITY AND CAPITAL RESOURCES
PRINCIPAL SOURCES OF LIQUIDITY
Principal sources of liquidity have been net proceeds from the Company's
initial public offering and bank financing. In March 1997, the Company
completed its initial public offering of 2,500,000 shares of common stock at
$12.00 per share. Upon the exercise of an overallotment option in April
1997, the Company issued an additional 293,300 shares at $12.00 per share.
The 29.6 million in net proceeds from the issuance of Common Stock was used
to reduce debt.
The Company entered into a $115.0 million syndicated credit facility (the
"Syndicated Credit Facility") in April, 1998. The Syndicated Credit Facility
permits revolving loans of up to $70.0 million (the "Revolving Loans") and
term loans of up to $45.0 million (the "Term Loans"). Any amounts
outstanding under the Revolving Loans mature in April, 2003. Term Loan
borrowings will be due in specified quarterly installments beginning in
April, 1999 with a final maturity in January, 2003.
Among the various provisions, limitations and restrictions contained in the
Syndicated Credit Facility, the Company must meet specified consolidated net
worth, leverage ratio, fixed charge coverage ratio, funded debt to total
capitalization ratio and consolidated earnings before the effect of interest
expense, income taxes, depreciation and amortization requirements. Under the
Syndicated Credit Facility, the Company is restricted in the amount of its
capital expenditures, indebtedness to certain other parties, payment of
dividends, or redemption of its stock that would create an event of default.
In the event of default, unless a waiver is obtained, any unpaid principal
and accrued interest may be declared immediately due and payable. the
Syndicated Credit Facility may be terminated at any time upon the occurrence
of an event of default. The Company retains the right to remedy certain
events of default within 30 days after notice.
The Company was not in compliance with certain covenants and had not
obtained the respective waivers as of June 30, 1998. As of June 30, 1998,
the Company was required to have a consolidated net worth greater than or
equal to $62.5 million, a fixed charge coverage ratio less than or equal to
1.25, and consolidated earnings before the effect of interest expense,
income taxes, depreciation and amortization greater than or equal to $15
million. As of June 30, 1998, the Company had a consolidated net worth of
$61.1 million, a fixed charge coverage ratio of(0.23), and consolidated
earnings before the effect of interest expense, income taxes, depreciation
and amortization of $8.4 million. Although the Company has requested these
waivers, there can be no assurance that these waivers will be obtained.
CASH FLOWS FROM OPERATING ACTIVITIES
For the six months ended June 30, 1998 and 1997, net cash used in operating
activities totaled $8.1 million and $9.1 million, respectively. Accounts
receivable, net increased $6.2 million from December 31, 1997 to June 30,
1998 due to increased sales volume and the seasonality of activewear
shipments. Inventories increased $13.1 million from December 31, 1997 to
June 30, 1998 in order to support shipments due in the last six months of
the year. These uses of cash were offset primarily by an increase in
accounts payable of $6.8 million.
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures were $8.2 million for the six months ended June 30,
1997. These capital expenditures were primarily to enhance manufacturing and
management information systems capabilities.
CASH FLOWS FROM FINANCING ACTIVITIES
For the six months ended June 30, 1998, the Company had net borrowings of
$16.6 million to help meet working capital and capital expenditure financing
needs.
10
FORWARD LOOKING STATEMENTS
Information in this Form 10-Q may contain certain forward looking
statements. These statements involve risks and uncertainties that could
cause actual results to differ materially, including without limitation, the
actual costs of operating the Company's business, actual operating
performance, the ability to maintain large client contracts or to enter into
new contracts and the level of demand for the Company's product. Additional
factors that could cause actual results to differ are discussed in the
Company's recent filings with the Securities Exchange Commission.
11
PART II - OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES
On January 28, 1997, the Board of Directors declared a 0.736-for-one
reverse Common Stock split for shareholders of record on February 3, 1997.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
An annual meeting of the Shareholders was held on June 2, 1998, in Bassett,
Virginia. Two matters were submitted to a vote on that date. The first
matter was a recommendation by the Company's Board of Directors to elect R.
Duke Ferrell, Jr., Barry A. Bowles and R. Stephens Pannill as directors to
hold office until the Annual Meeting of Shareholders to be held in 2001 and
until their successors are elected and qualified. The Board of Directors
currently consists of eleven members which are divided into three classes,
each class serving a three year term. George G. Wade, G. Walker Box, C.
Monroe Light, Ronald A. Norelli, J. Robert Philpott, William K. Mileski,
John D. Adams and Kemp D. Box continued as Directors of the Company.
The second matter submitted to a vote of the Shareholders was the
ratification of Deloitte & Touche LLP to serve as independent auditors of
the Company for the fiscal year ending December 31, 1998.
The number of votes cast for these matters are summarized below:
AUTHORITY BROKER
DIRECTOR FOR WITHHELD ABSTAIN NON-VOTES
R. Duke Ferrell Jr. 7,237,447 19,700 0
Barry A. Bowles 7,225,447 31,700 0
R. Stephens Pannill 7,220,627 36,520 0
INDEPENDENT AUTHORITY BROKER
ACCOUNTANT FOR WITHHELD ABSTAIN NON-VOTES
Deloitte & Touche LLP 7,202,585 49,512 5,050 0
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits
Exhibit
Number Filed Herewith (*)
------
10.1 Credit Agreement dated April 23, 1998 *
11.1 Computation of Earnings per Share *
b. Reports on Form 8-K
None
12
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.
Pluma, Inc.
-----------------------------------
R. Duke Ferrell, Jr.
President, Chief Executive Officer
and Director
-----------------------------------
Forrest H. Truitt II
Executive Vice President, Treasurer
and Chief Financial Officer
13