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 January 25, 1997 COMMISSION FILE NUMBER 1-9656 LA-Z-BOY INCORPORATED (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 LA-Z-BOY CHAIR COMPANY 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 January 25, 1997 Common Shares, $1.00 par value 17,960,888
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 February 5, 1997 and are incorporated herein by reference.
LA-Z-BOY INCORPORATED CONSOLIDATED STATEMENTS OF CASH FLOWS INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (Unaudited, dollar amounts in thousands) Three Months Ended Nine Months Ended ------------------- ------------------ Jan. 25, Jan. 27 Jan. 25, Jan. 27, 1997 1996 1997 1996 -------- -------- ------- -------- Cash Flows from Operating Activities Net income $9,801 $7,784 $29,651 $25,215 Adjustments to reconcile net income to net cash provided by operating activities Depreciation and amortization 5,189 4,886 15,215 14,305 Change in receivables 37,106 36,039 27,312 22,362 Change in inventories (1,978) (4,871) (12,994) (8,101) Change in other assets and liab. (11,979) (6,871) (1,035) (796) Change in deferred taxes (439) (770) 1,317 (1,659) --------- -------- -------- -------- Total adjustments 27,899 28,413 27,181 26,111 --------- -------- -------- -------- Cash Provided by Operating Activities 37,700 36,197 56,832 51,326 Cash Flows from Investing Activities Proceeds from disposals of assets (167) 193 554 971 Capital expenditures (4,580) (3,351) (12,803) (12,590) Change in other investments (571) (2,918) (6,013) (1,830) ---------- -------- ------- ------- Cash Used for Investing Activities (5,318) (6,076) (18,262) (13,449) Cash Flows from Financing Activities Short-term debt - 280 - 280 Long-term debt - - - - Retirements of debt (64) (65) (3,068) (10,616) Capital leases - - - 1,161 Capital lease principal payments (509) (578) (1,587) (1,655) Stock for stock option plans 1,005 428 2,851 2,503 Stock for 401(k) employee plans 276 344 944 987 Purchase of La-Z-Boy stock (6,993) (52) (17,361) (4,485) Payment of cash dividends (3,446) (3,523) (9,909) (10,183) ---------- -------- -------- -------- Cash Used for Financing Activities (9,731) (3,166) (28,130) (22,008) Effect of exch. rate changes on cash (53) (69) 54 (87) ---------- -------- -------- -------- Net change in cash and equivalents 22,598 26,886 10,494 15,782 Cash and equiv. at beginning of period 14,956 15,944 27,060 27,048 ---------- -------- -------- -------- Cash and equiv. at end of period $37,554 $42,830 $37,554 $42,830 ========== ======== ======== ======== Cash paid during period - Income taxes $12,461 $11,668 $23,231 $20,479 - Interest $948 $923 $2,918 $3,434 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 INCORPORATED 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 January 25, 1997 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 INCORPORATED AND OPERATING DIVISIONS MANAGEMENT DISCUSSION 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 3.4 to 1 at the end of the third quarter. At April 27, 1996, the debt to capital percentage was 17% and the current ratio was 3.5 to 1. At the end of the preceding year's third quarter, the debt to capital percentage was 18% and the current ratio was 3.6 to 1. As of January 25, 1997, there was $87 million of unused lines of credit available under several credit arrangements. Approximately 19% 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 6. Exhibits and Reports on Form 8-K (a) (27) Financial Data Schedule (EDGAR only) (99) News Release and Financial Information Release: re Actual third quarter results and Management Discussion dated February 5, 1997. 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 January 25, 1997 to be signed on its behalf by the undersigned thereunto duly authorized. LA-Z-BOY INCORPORATED (Registrant) /s/ James J. Korsnack Date February 5, 1997 James J. Korsnack Corporate Controller