SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549-1004 FORM 10-Q Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 FOR QUARTER ENDED July 27, 1996 COMMISSION FILE NUMBER 1-9656 LA-Z-BOY CHAIR COMPANY (Exact name of registrant as specified in its charter) MICHIGAN 38-0751137 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1284 North Telegraph Road, Monroe, Michigan 48162-3390 (Address of principal executive offices) (Zip Code) REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (313) 241-4414 None Former name, former address and former fiscal year, if changed since last report. 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 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 issuer's classes of common stock, as of the last practicable date: Class Outstanding at July 27, 1996 Common Shares, $1.00 par value 18,164,437
Part I. Financial Information The Consolidated Balance Sheet and Consolidated Statement of Income required for Part I are contained in the Registrant's Financial Information Release dated August 14, 1996 and are incorporated herein by reference.
LA-Z-BOY CHAIR COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (Unaudited, dollar amounts in thousands) Three Months Ended ------------------ July 27, July 29, 1996 1995 ------- -------- Cash Flows from Operating Activities Net income $4,598 $3,175 Adjustments to reconcile net income to net cash provided by operating activities Depreciation and amortization 4,855 4,684 Change in receivables 44,935 37,849 Change in inventories (12,928) (4,393) Change in other assets and liab. (19,136) (15,846) Change in deferred taxes - - -------- -------- Total adjustments 17,726 22,294 -------- -------- Cash Provided by Operating Activities 22,324 25,469 Cash Flows from Investing Activities Proceeds from disposals of assets 113 133 Capital expenditures (4,580) (3,160) Change in other investments (5,621) 959 --------- -------- Cash Used for Investing Activities (10,201) (2,068) Cash Flows from Financing Activities Short-term debt - - Long-term debt - - Retirements of debt (2,940) (4,072) Capital leasees - - Capital lease principal payments (565) (517) Stock for stock option plans 1,470 1,268 Stock for 401(k) employee plans 383 305 Purchase of La-Z-Boy stock (7,126) (4,392) Payment of cash dividends (3,482) (3,155) --------- -------- Cash Used for Financing Activities (12,260) (10,563) Effect of exch. rate changes on cash (53) (78) --------- -------- Net change in cash and equivalents (190) 12,760 Cash and equiv. at beginning of period 27,060 27,048 --------- -------- Cash and equiv. at end of period $26,870 $39,808 ========= ======== Cash paid during period - Income taxes $2,257 $1,657 - Interest $833 $1,110 For purposes of the Statement of Cash Flows, the Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents. The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.
LA-Z-BOY CHAIR COMPANY AND OPERATING DIVISIONS NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 1. Basis of Presentation The financial information is prepared in conformity with generally accepted accounting principles and such principles are applied on a basis consistent with those reflected in the 1996 Annual Report filed with the Securities and Exchange Commission. The financial information included herein, other than the consolidated condensed balance sheet as of April 27, 1996, has been prepared by management without audit by independent certified public accountants who do not express an opinion thereon. The consolidated condensed balance sheet as of July 27, 1996 has been derived from, but does not include all the disclosures contained in, the audited consolidated financial statements for the year ended April 27, 1996. The information furnished includes all adjustments and accruals consisting only of normal recurring accrual adjustments which are, in the opinion of management, necessary for a fair presentation of results for the interim period. 2. Interim Results The foregoing interim results are not necessarily indicative of the results of operations for the full fiscal year ending April 26, 1997. 3. Commitments and Contingencies There has been no significant change from the prior fiscal year end audited financial statements. LA-Z-BOY CHAIR COMPANY AND OPERATING DIVISIONS MANAGEMENT DISCUSSION La-Z-Boy's sales and profits historically have been weakest in the first quarter of the fiscal year due to the Company's two-week vacation shutdown which coincides with the slowest sales period. Therefore, first quarter comparison to the prior year's first quarter may not be indicative of trends that will continue in the remaining quarters of the fiscal year. Due to the cyclical nature of the Company's business, comparison of operations between the most recently completed quarter and the immediate preceding quarter would not be meaningful and could be misleading to the reader of these financial statements. For further Management Discussion, see attached Exhibit 99 The Company's strong financial position is reflected in the debt to capital percentage of 16% and a current ratio of 3.9 to 1 at the end of the first quarter. At April 27, 1996, the debt to capital percentage was 20% and the current ratio was 3.7 to 1. At the end of the preceding year's first quarter, the debt to capital percentage was 20% and the current ratio was 4.0 to 1. As of July 27, 1996, there was $63 million of unused lines of credit available under several credit arrangements. Approximately 29% of the 3 million shares of Company stock authorized for purchase on the open market are still available for purchase by the Company. The Company plans to be in the market for its shares as changes in its stock price and other factors present appropriate opportunities. PART II. OTHER INFORMATION Item 4. Submission of Matters to a Vote of Security Holders The Annual Meeting of Shareholders of La-Z-Boy Chair Company was held on July 29, 1996, for the purposes of electing four members to the board of directors, amending and restating the Company's 1993 Performance-Based Stock Plan and amending the Company's Articles of Incorporation to change the Company's name to "La-Z-Boy Incorporated". Proxies for the meeting were solicited pursuant to Section 14(a) of the Securities and Exchange Act of 1934 and there was no solicitation in opposition of Management's solicitations. The Shareholders elected all of Management's nominees for directors as listed in the proxy statement and approved amending and restating the stock plan and changing the Company name. The name change is expected to become effective August 30, 1996. Item 6. Exhibits and Reports on Form 8-K (a) (27) Financial Data Schedule (EDGAR only) (99) News Release and Financial Information Release: re Actual first quarter results and Management Discussion dated August 14, 1996. (b) An 8-K was filed on May 30, 1996 releasing fourth quarter and full year financial results. This release also included the financial section of the 1996 Annual Report. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused the Quarterly Report on Form 10-Q for the quarter ended July 27, 1996 to be signed on its behalf by the undersigned thereunto duly authorized. LA-Z-BOY CHAIR COMPANY (Registrant) /s/ James J. Korsnack Date August 14, 1996 James J. Korsnack Corporate Controller