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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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): August 31, 2004
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ZALE CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 001-04129 75-0675400
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
901 West Walnut Hill Lane, Irving, Texas 75038-1003
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(Address of principle executive offices) (Zip code)
Registrant's telephone number, including area code: (972) 580-4000
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Not Applicable
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(Former name or former address, if changed since last report)
ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On August 31, 2004, Zale Corporation issued a press release reporting
its financial results for its fourth fiscal quarter and year ended July 31,
2004. A copy of the press release is hereby furnished as Exhibit 99.1 and
incorporated herein by reference.
The attached press release includes a presentation of earnings and
earnings per share, for the fiscal quarter ended July 31, 2003, that excludes
costs associated with redeeming the Company's senior notes in the fourth quarter
of fiscal year 2003. In addition, the attached press release includes a
presentation of earnings and earnings per share, for the fiscal year ended July
31, 2003, that excludes the senior note redemption costs as well as a non-cash
goodwill impairment charge incurred during the second quarter of fiscal year
2003. Such measures are not measures of financial performance under GAAP and
should not be considered as alternatives to net earnings and earnings per share
as computed under GAAP for the applicable period. The Company considers net
earnings and earnings per share to be the most comparable GAAP measures and has
presented reconciling information in the first and second paragraphs of the
press release.
The Company believes that these non-GAAP financial measures are
helpful, when presented in conjunction with the comparable GAAP measures.
Management uses earnings measures adjusted to exclude the charges as part of its
evaluation of the performance of the Company. Further, the Company believes
these measures provide useful information to investors because the charges
excluded relate to events that resulted in a significant impact during the
second and fourth quarters of fiscal year 2003 and will recur with unpredictable
frequency. Non-cash goodwill impairment charges may occur in the future, as the
Company reviews its goodwill each year under SFAS 142; however, such charges
will vary in size and frequency. Unusual financing charges, such as the costs
associated with redeeming the senior notes, occur more regularly in the
Company's business, but vary in size and frequency.
In addition, the attached press release includes a presentation of
"free operating cash flow." Free operating cash flow is a non-GAAP financial
measure and is defined as cash flows from operating activities (in accordance
with GAAP) less net capital expenditures. The Company considers cash flows from
operating activities to be the most comparable GAAP financial measure, and has
included in the press release a reconciliation of cash flows from operating
activities to free operating cash flow.
The Company believes the presentation of free operating cash flow
presents useful information about the amount of cash generated from operations
after making capital investments to support growth initiatives. Free operating
cash flow should not be considered as an alternative to cash flows from
operating, financing or investing activities or as a measure of liquidity.
Further, free operating cash flow does not represent the total increase or
decrease in the cash balance for the period. Readers are encouraged to review
the Statement of Cash Flows included in the attached press release for
information regarding the Company's cash flows from operating, financing and
investing activities under GAAP.
The information set forth under this Item 2.02 is being furnished and
shall not be deemed "filed" for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended, nor shall it be deemed incorporated by
reference in any filing under the Securities Act of 1933, as amended, except as
shall be expressly set forth by specific reference in such filing.
EXHIBIT INDEX
99.1 Press Release of Zale Corporation issued August 31, 2004.
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.
ZALE CORPORATION
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Registrant
Date: August 31, 2004 By: /s/ Cynthia T. Gordon
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Cynthia T. Gordon
Senior Vice President,
Controller
(principle accounting officer
of the registrant)
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