Federated Reports Fourth Quarter Results; Company Earns $2.15 Per Diluted Share, Excluding Restructuring Charges.Business Editors CINCINNATI--(BUSINESS WIRE)--Feb. 27, 2001 Federated Connected and treated as one. See federated database and federated directories. Department Stores This is a list of department stores. In the case of department store groups the location of the flagship store is given. This list does not include large specialist stores, which sometimes resemble department stores. , Inc. (NYSE NYSE See: New York Stock Exchange :FD) today reported fourth quarter and fiscal 2000 results. Diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of were $2.15 for the fourth quarter and $3.08 for the year, excluding asset impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. and restructuring charges restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. related to the downsizing (1) Converting mainframe and mini-based systems to client/server LANs. (2) To reduce equipment and associated costs by switching to a less-expensive system. (jargon) downsizing of Fingerhut and the closing of the company's Stern's Stern's was a regional department store chain serving the U.S. states of New York, Pennsylvania, and New Jersey. The chain was in business for more than 130 years, prior to its 2001 integration into Macy's and Bloomingdale's. department store division. "This has been a disappointing year overall, primarily due to the negative impact of the Fingerhut credit problem on Federated's earnings performance," said James James, person in the Bible James, in the Gospel of St. Luke, kinsman of St. Jude. The original does not specify the relationship. James, rivers, United States James. M. Zimmerman Zimmerman may refer to: People
Zimmerman went on to say that while Federated's profit results were below the company's expectations, cash flow performance exceeded expectations. "We are confronting the difficulties in our direct-to-customer segment in general, and our Macy's Macy's formerly R.H. Macy & Co., Inc. Major U.S. department-store chain. Its former flagship, an 11-story store that occupies a city block in New York City's Herald Square, was for many years the largest single store in the country. Rowland H. and Bloomingdale's This article or section needs sources or references that appear in reliable, third-party publications. Alone, primary sources and sources affiliated with the subject of this article are not sufficient for an accurate encyclopedia article. e-commerce e-commerce, commerce conducted over the Internet, most often via the World Wide Web. E-commerce can apply to purchases made through the Web or to business-to-business activities such as inventory transfers. businesses are making good progress," Zimmerman said. "While 2001 will not be an easy year, we do expect it to be consistent with our previously targeted $4.00 to $4.25 per share earnings estimate." Net Income/Cash Flow For the 14-week fourth quarter ended February February: see month. 3, 2001, Federated's net income was $332 million, compared to $448 million for the 13-week period last year. Excluding the one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. charges, diluted earnings per share for the fourth quarter of 2000 were $2.15 compared to $2.04 last year, representing a 5.4 percent increase for the quarter. Federated posted a loss of $184 million for the 53 weeks of fiscal 2000, compared to earnings of $795 million for the 52 weeks of fiscal 1999. The loss on the year reflects one-time asset impairment and restructuring charges of $962 million primarily related to the Fingerhut downsizing and the announced closing of Stern's. On a diluted-share basis, the company lost 90 cents a share in fiscal 2000 compared to earnings of $3.62 a share last year. Excluding the one-time charges, the company's diluted earnings per share in 2000 were $3.08. Federated also produced stronger than anticipated cash flow in fiscal 2000 -- $481 million this year compared to $370 million in fiscal 1999, before financing and costs of the Fingerhut acquisition. The company used $603 million of excess cash to repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. 17.6 million shares of Federated common stock in the last year. Department Store Segment Department store operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for the 14-week fourth quarter of 2000 was $939 million or 17.0 percent of sales, excluding one-time charges, compared to operating income of $872 million or 16.8 percent of sales in the 13-week quarter of 1999. Department store operating income for the 53 weeks of fiscal 2000 was $2.004 billion or 12.2 percent of sales, excluding one-time charges, compared to operating income of $1.871 billion or 11.8 percent of sales in the 52-week prior year. Including charges related to the closing of Stern's, the company's operating income for fiscal 2000 was $1.950 billion. For the 14-week fourth quarter, department store sales totaled $5.540 billion, an increase of 6.6 percent over total department store sales of $5.198 billion for the 13-week fourth quarter of 1999. On a comparable-store, comparable 13-week basis, Federated's fourth quarter department store sales increased 1.6 percent. The company labeled its department store segment performance as acceptable given the difficult fourth-quarter economy, noting that the fourth quarter's 1.6 percent comp-store sales increase came on top of comp-sales increases averaging about 4.0 percent in the fourth quarter for each of the prior two years. Sales in the department store segment for the 53 weeks of fiscal 2000 totaled $16.467 billion, an increase of 3.9 percent over 52-week sales of $15.850 billion in the prior year. On a comparable-store, comparable 52-week basis, Federated's annual department store sales increased 2.0 percent. Direct-to-Customer Segment Operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. in the direct-to-customer segment for the 14-week fourth quarter of 2000 totaled $48 million, compared to operating income of $55 million in the 13-week quarter of 1999. Excluding Fingerhut asset impairment and restructuring charges, the operating loss in this segment would have been $6 million in the fourth quarter of 2000. Direct-to-customer operating income for the 53 weeks of fiscal 2000 showed a loss of $392 million, compared to operating income of $51 million in the 52-week prior year. Excluding asset impairment and restructuring charges related to Fingerhut, the company's direct-to-customer operating loss for fiscal 2000 would have been $288 million. Federated said direct-to-customer losses in the second half of the year totaled approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $82 million, which was somewhat worse than the $20-70 million that had been forecast at mid-year. The company noted, however, that Fingerhut's operating income was within the range of expectations, with the segment being significantly impacted by the poor performance of its Bloomingdale's By Mail operation. For the 14-week fourth quarter, direct-to-customer sales totaled $575 million, a decrease of 25.9 percent from total sales of $775 million in this segment during the 13-week fourth quarter of 1999. This reflected unexpectedly weak sales resulting in inventory liquidation The collection of assets belonging to a debtor to be applied to the discharge of his or her outstanding debts. A type of proceeding pursuant to federal Bankruptcy at the Bloomingdale's By Mail catalog catalog, descriptive list, on cards or in a book, of the contents of a library. Assurbanipal's library at Nineveh was cataloged on shelves of slate. The first known subject catalog was compiled by Callimachus at the Alexandrian Library in the 3d cent. B.C. , as well as anticipated lower sales resulting from downsizing Fingerhut's operations. Sales in the direct-to-customer segment for the 53 weeks of fiscal 2000 totaled $1.940 billion, up 3.9 percent from 52-week sales of $1.866 billion in the prior year. Restructuring Charges Asset impairment and restructuring charges for the fourth quarter of fiscal 2000 break down as follows: -- $54 million related to the closing of Stern's (with the remainder of the expected $130-150 million to be taken in fiscal 2001); -- $42 million related to the downsizing of Fingerhut operations (bringing the total Fingerhut-related charges for the year to $86 million, which is consistent with prior company forecasts of $75-$100 million); and -- $71 million related to the further non-cash write-down of certain Internet- related and other minority investments. 2001 Forecast Federated said it expects to achieve its targeted earnings per share goal of $4.00 to $4.25 a share in fiscal 2001 -- 37-42 cents a share for the first quarter of 2000, 75-80 cents a share for the second quarter, and $2.90-$3.05 a share for the second half of the year ending February 2, 2002. A comp-store sales increase of 2 percent is forecast for the department store segment in the new fiscal year, and the company expects to open a total of 11 new stores in 2001, including two new furniture stores. The company also noted that it is changing its segment reporting segment reporting A type of financial reporting in which the firm discloses information by identifiable industry segments. For example, Union Pacific Corporation reports revenues, income, assets, depreciation, and capital expenditures for each of four to better reflect how it is operating. Going forward, the company will report two segments -- department stores, which will include related catalog and e-commerce operations, and Fingerhut. This segmentation will be reflected in Federated's 2001 sales and earnings reports, and other performance assessments. A chart of restated segment operating results for fiscal 1999 and fiscal 2000 is included with this release for analytical analytical, analytic pertaining to or emanating from analysis. analytical control control of confounding by analysis of the results of a trial or test. purposes. Federated, with corporate offices in Cincinnati Cincinnati (sĭnsənăt`ē, –năt`ə), city (1990 pop. 364,040), seat of Hamilton co., extreme SW Ohio, on the Ohio River opposite Newport and Covington, Ky.; inc. as a city 1819. and New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , is one of the nation's leading department store retailers, with annual sales of more than $18.4 billion. Federated currently operates more than 400 department stores in 33 states and Puerto Rico Puerto Rico (pwār`tō rē`kō), island (2005 est. pop. 3,917,000), 3,508 sq mi (9,086 sq km), West Indies, c.1,000 mi (1,610 km) SE of Miami, Fla. under the names of Bloomingdale's, The Bon Marche Marche, region, Italy Marche (mär`kā) or the Marches, region (1991 pop. 1,429,205), 3,742 sq mi (9,692 sq km), E central Italy, extending from the eastern slopes of the Apennines to the Adriatic Sea. , Burdines The references in this article would be clearer with a different and/or consistent style of citation, footnoting or external linking. Burdines was a leading department store chain in the state of Florida that was part of Federated Department Stores, Inc. , Goldsmith's Goldsmith's was a department store founded in Memphis, Tennessee in 1870 by German immigrant brothers Jacob and Isaac Goldsmith, who, with a $500 investment, opened a dry goods store on a muddy lane called Beale Street. , Lazarus Lazarus (lăz`ərəs) [Gr.,=Heb., Eleazar], in the New Testament. 1 Brother of Mary and Martha of Bethany who, after four days in the tomb, was brought back to life by Jesus. , Macy's, Rich's
Rich's was a major department store retail chain, headquartered in Atlanta, Georgia, that operated in the southern U.S. and Stern's, as well as Bloomingdale's By Mail, Macy's By Mail, macys.com and bloomingdales.com. Federated also operates the Fingerhut catalog and e-commerce subsidiary. (NOTE: This release contains certain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that reflect current views of the financial performance and future events of Federated. The words "expect," "plan," "think," "believe" and other similar expressions identify forward-looking statements. Any such forward-looking statements are subject to risks and uncertainties. Future results of the operations of Federated could differ materially from historical results or current expectations because of a variety of factors that affect the company, including transaction costs Transaction Costs Costs incurred when buying or selling securities. These include brokers' commissions and spreads (the difference between the price the dealer paid for a security and the price they can sell it). associated with the renovation, conversion and transitioning of company retail stores in regional markets; the outcome and timing of sales and leasing in conjunction conjunction, in astronomy conjunction, in astronomy, alignment of two celestial bodies as seen from the earth. Conjunction of the moon and the planets is often determined by reference to the sun. with the disposition Act of disposing; transferring to the care or possession of another. The parting with, alienation of, or giving up of property. The final settlement of a matter and, with reference to decisions announced by a court, a judge's ruling is commonly referred to as disposition, regardless of of company retail store properties; the retention, reintegration reintegration /re·in·te·gra·tion/ (-in-te-gra´shun) 1. biological integration after a state of disruption. 2. restoration of harmonious mental function after disintegration of the personality in mental illness. and transitioning of displaced displaced see displacement. company employees; and competitive pressures from department and specialty stores Noun 1. specialty store - a store that sells only one kind of merchandise shop, store - a mercantile establishment for the retail sale of goods or services; "he bought it at a shop on Cape Cod" , general merchandise MERCHANDISE. By this term is understood all those things which merchants sell either wholesale or retail, as dry goods, hardware, groceries, drugs, &c. It is usually applied to personal chattels only, and to those which are not required for food or immediate support, but such as remain stores, manufacturers' outlets, off-price off-price adj. 1. Of, relating to, or being a retail store that sells merchandise at prices lower than usual. 2. For sale at prices lower than usual: off-price assortments of women's clothing. and discount stores, and all other retail channels; and general consumer-spending levels, including the impact of the availability and level of consumer debt, and the effects of weather.) Information on Federated and its operating divisions is available on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at www.federated-fds.com. The company also will provide a live webcast of its yearend earnings conference call with analysts at 10:30 a.m. ET today. The webcast can be accessed through the Federated website, and pre-registration is requested. The webcast will be archived for subsequent replay beginning approximately two hours after the live call concludes.)
FEDERATED DEPARTMENT STORES, INC.
Consolidated Statements of Operations (Unaudited)
(All amounts in millions except percentages and per share figures)
14 Weeks 13 Weeks 53 Weeks 52 Weeks
Ended Ended Ended Ended
February 3, January 29, February 3, January 29,
2001 2000 2001 2000
----------- ----------- ----------- -----------
Net Sales $ 6,115 $ 5,973 $ 18,407 $ 17,716
-------- -------- -------- --------
Cost of Sales:
Recurring
(Note 1) 3,583 3,496 10,872 10,443
Inventory valuation
adjustments
related to Fingerhut
restructuring - - 35 -
-------- -------- -------- --------
Total cost of sales 3,583 3,496 10,907 10,443
Percent to sales 58.6% 58.5% 59.3% 58.9%
Selling, general and
administrative
expenses 1,697 1,621 6,023 5,572
Percent to sales 27.8% 27.1% 32.7% 31.5%
Asset impairment and
restructuring
charges (Note 2) 167 - 927 -
Percent to sales 2.7% -% 5.0% -%
-------- -------- -------- --------
Operating Income 668 856 550 1,701
Percent to sales 10.9% 14.4% 3.0% 9.6%
Interest expense - net (119) (104) (437) (355)
-------- -------- -------- --------
Income Before Income
Taxes 549 752 113 1,346
Federal, state and
local income
tax expense (217) (304) (297) (551)
-------- -------- -------- --------
Net Income (Loss) $ 332 $ 448 $ (184) $ 795
-------- -------- -------- --------
-------- -------- -------- --------
FEDERATED DEPARTMENT STORES, INC.
Consolidated Statements of Operations (Unaudited)
14 Weeks 13 Weeks 53 Weeks 52 Weeks
Ended Ended Ended Ended
February 3, January 29, February 3, January 29,
2001 2000 2001 2000
----------- ----------- ----------- -----------
Basic Earnings (Loss)
per share
(Note 3) $1.67 $ 2.11 $ (.90) $ 3.78
-------- -------- -------- --------
-------- -------- -------- --------
Diluted Earnings (Loss)
per share
(Note 3) $1.65 $ 2.04 $ (.90) $ 3.62
-------- -------- -------- --------
-------- -------- -------- --------
Analytical Diluted
Earnings per share
(Notes 3 and 4) $2.15 $ 2.04 $3.08 $ 3.62
-------- -------- -------- --------
-------- -------- -------- --------
Notes:
(1) Substantially all department store merchandise inventories are
valued by the retail method and stated on the LIFO (last-in,
first-out) basis, which is generally lower than market.
Application of this method did not impact cost of sales for the
14 and 53 weeks ended February 3, 2001 or the 13 and 52 weeks
ended January 29, 2000. Direct-to-customer merchandise
inventories are stated at the lower of FIFO (first-in, first-out)
cost or market.
(2) Asset impairment and restructuring charges for the 14 weeks ended
February 3, 2001 represent the write-down of certain Fingerhut
Internet-related and other venture capital investments totaling
$71 million, severance costs, facility closing costs and asset
write-downs related to the downsizing of Fingerhut operations
totaling $42 million and asset write-downs related to the closure
of the Stern's department store division and the planned
disposition of certain of its properties totaling $54 million.
Asset impairment and restructuring charges for the 53 weeks ended
February 3, 2001 represent the write-down of intangible assets
related to the Fingerhut acquisition totaling $673 million, the
write-down of certain Fingerhut Internet-related and other
venture capital investments totaling $131 million, the write-down
of Fingerhut fixed assets totaling $18 million, severance costs,
facility closing costs and asset write-downs related to the
downsizing of Fingerhut operations totaling $51 million and asset
write-downs related to the closure of the Stern's department
store division and the planned disposition of certain of its
properties totaling $54 million.
(3) Common shares outstanding used in computing basic earnings (loss)
per share were 198.7 million and 212.3 million for the 14 weeks
ended February 3, 2001 and the 13 weeks ended January 29, 2000,
respectively, and 204.8 million and 210.4 million for the 53
weeks ended February 3, 2001 and the 52 weeks ended January 29,
2000, respectively. Potential common shares used in computing
diluted earnings (loss) per share were 201.6 million and 219.9
million for the 14 weeks ended February 3, 2001 and the 13 weeks
ended January 29, 2000, respectively, and 204.8 million (207.0
million on an analytical basis) and 219.6 million for the 53
weeks ended February 3, 2001 and the 52 weeks ended January 29,
2000, respectively.
(4) Excludes the impact of inventory valuation adjustments related to
the Fingerhut restructuring and the asset impairment and
restructuring charges (see Note 2).
FEDERATED DEPARTMENT STORES, INC.
Operating Segment Data (Unaudited)
----------------------------------
(millions)
14 Weeks 13 Weeks 53 Weeks 52 Weeks
Ended Ended Ended Ended
February 3, January 29, February 3, January 29,
2001 2000 2001 2000
----------- ----------- ----------- -----------
Net Sales
Department Stores $5,540 $5,198 $16,467 $15,850
Direct-to-Customer 575 775 1,940 1,866
----------- ----------- ----------- -----------
Total $6,115 $5,973 $18,407 $17,716
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Operating income
Department Stores:
Recurring $ 939 $ 872 $ 2,004 $ 1,871
Asset impairment
and restructuring
charges (Note 1) (54) - (54) -
----------- ----------- ----------- -----------
Total Department Stores 885 872 1,950 1,871
Direct-to-Customer:
Recurring (6) 55 (288) 51
Asset impairment
and restructuring
charges (Note 2) (42) - (104) -
----------- ----------- ----------- -----------
Total Direct-to-Customer (48) 55 (392) 51
Corporate and other:
Recurring (Note 3) (98) (71) (204) (221)
Asset impairment
and restructuring
charges (Note 4) (71) - (804) -
----------- ----------- ----------- -----------
Total corporate and other (169) (71) (1,008) (221)
----------- ----------- ----------- -----------
Total $ 668 $ 856 $ 550 $ 1,701
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
FEDERATED DEPARTMENT STORES, INC.
Operating Segment Data (Unaudited)
----------------------------------
(millions)
14 Weeks 13 Weeks 53 Weeks 52 Weeks
Ended Ended Ended Ended
February 3, January 29, February 3, January 29,
2001 2000 2001 2000
----------- ----------- ----------- -----------
Depreciation and
amortization expense
Department Stores $ 155 $ 158 $ 606 $ 619
Direct-to-Customer 11 5 44 33
Corporate and
other (Note 2) 14 24 83 86
----------- ----------- ----------- -----------
Total $ 180 $ 187 $ 733 $ 738
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Notes:
(1) Asset impairment and restructuring charges in the Department Store
segment represent asset write-downs related to the closure of the
Stern's department store division and the planned disposition of
certain of its properties totaling $54 million.
(2) Asset impairment and restructuring charges for the 14 weeks ended
February 3, 2001 in the Direct-to-customer segment represent
severance costs, facility closing costs and asset write-downs
related to the downsizing of Fingerhut operations totaling
$42 million. Asset impairment and restructuring charges for the
53 weeks ended February 3, 2001 in the Direct-to-customer segment
represent the write-down of fixed assets totaling $18 million and
other restructuring charges totaling $86 million, consisting of
severance costs, facility closing costs and asset write-downs
related to the downsizing of Fingerhut operations totaling
$51 million and $35 million of inventory valuation adjustments
related to the Fingerhut restructuring.
(3) Corporate and other consists of the income or expense associated
with the corporate office and certain items managed on a
company-wide basis (e.g. intangibles, financial instruments,
investments, retirement benefits and properties held for sale or
disposition).
(4) Asset impairment and restructuring charges for the 14 weeks ended
February 3, 2001 in the Corporate and other segment represent the
write-down of certain Fingerhut Internet-related and other venture
capital investments totaling $71 million. Asset impairment and
restructuring charges for the 53 weeks ended February 3, 2001 in
the Corporate and other segment represent the write-down of
intangible assets related to the Fingerhut acquisition totaling
$673 million and the write down of certain Fingerhut
Internet-related and other venture capital investments totaling
$131 million.
FEDERATED DEPARTMENT STORES, INC.
Consolidated Balance Sheets (Unaudited)
---------------------------------------
(All amounts in millions except percentages)
February 3, 2001 January 29, 2000
---------------- ----------------
ASSETS:
Current Assets:
Cash $ 322 $ 218
Accounts receivable (Note 1) 4,072 4,313
Merchandise inventories 3,812 3,589
Supplies and prepaid expenses 200 230
Deferred income tax assets 294 172
---------------- ----------------
Total Current Assets 8,700 8,522
Property and Equipment - net 6,830 6,828
Intangible Assets - net 896 1,735
Other Assets 586 607
---------------- ----------------
Total Assets $ 17,012 $ 17,692
---------------- ----------------
---------------- ----------------
LIABILITIES AND SHAREHOLDERS' EQUITY:
Current Liabilities:
Short-term debt $ 1,722 $ 1,284
Accounts payable and
accrued liabilities 2,903 3,043
Income taxes 244 225
---------------- ----------------
Total Current Liabilities 4,869 4,552
Long-Term Debt 4,374 4,589
Deferred Income Taxes 1,393 1,444
Other Liabilities 554 555
Shareholders' Equity 5,822 6,552
---------------- ----------------
Total Liabilities and
Shareholders' Equity $ 17,012 $ 17,692
---------------- ----------------
---------------- ----------------
Ratio of debt to total capitalization 51.1% 47.3%
---------------- ----------------
---------------- ----------------
Return on gross investment (Note 2) 14.6% 16.8%
---------------- ----------------
---------------- ----------------
Notes:
1. Consists of $1,637 million of Fingerhut accounts receivable,
net of $584 million of allowance for doubtful accounts and
$2,435 million of other Federated accounts receivable, net of
$71 million of allowance for doubtful accounts as of February
3, 2001; and $1,978 million of Fingerhut accounts receivable,
net of $295 million of allowance for doubtful accounts and
$2,335 million of other Federated accounts receivable, net of
$63 million of allowance for doubtful accounts as of January
29, 2000.
2. Operating income, excluding inventory valuation adjustments
relating to the Fingerhut restructuring, asset impairment and
restructuring charges, depreciation, amortization and gross
rent expense divided by gross investment. Gross investment is
defined as average gross fixed assets, including
capitalization of operating leases, and the average balances
of all other assets and liabilities excluding debt, intangible
assets and income taxes.
FEDERATED DEPARTMENT STORES, INC.
Consolidated Statements of Cash Flows (Unaudited)
(millions)
53 Weeks Ended 52 Weeks Ended
February 3, 2001 January 29, 2000
---------------- ----------------
Cash flows from operating activities:
Net income (loss) $ (184) $ 795
Adjustments to reconcile net income
(loss) to net cash provided by
operating activities:
Depreciation and amortization 653 657
Amortization of intangible assets 74 78
Amortization of financing costs 7 7
Amortization of unearned restricted
stock 6 3
Asset impairment and restructuring
charges 962 -
Changes in assets and liabilities:
(Increase) decrease in accounts
receivable 225 (473)
Increase in merchandise
inventories (256) (164)
(Increase) decrease in supplies
and prepaid expenses 30 (27)
Increase in other assets not
separately identified (17) (8)
Increase (decrease) in accounts
payable and accrued liabilities
not separately identified (154) 194
Increase in current income taxes 22 128
Increase (decrease) in deferred
income taxes (77) 64
Increase (decrease) in other
liabilities not separately
identified (6) 9
----- -----
Net cash provided by
operating activities 1,285 1,263
----- -----
Cash flows from investing activities:
Purchase of property and equipment (742) (770)
Capitalized software (100) (52)
Investments in companies (34) (117)
Acquisition of Fingerhut Companies,
Inc., net of cash acquired - (1,539)
Disposition of property and equipment 72 46
----- -----
Net cash used by investing
activities (804) (2,432)
----- -----
Cash flows from financing activities:
Debt issued 750 1,684
Financing costs (6) (10)
Debt repaid (528) (650)
Increase (decrease) in outstanding
checks (43) 33
Acquisition of treasury stock (603) (267)
Issuance of common stock 53 290
----- -----
Net cash provided (used) by
financing activities (377) 1,080
----- -----
Net increase (decrease) in cash 104 (89)
Cash beginning of period 218 307
----- -----
Cash end of period $ 322 $ 218
----- -----
----- -----
FEDERATED DEPARTMENT STORES, INC.
Restated Segment Operating Results (Note 1)
(millions)
Fiscal 2000
--------------------------------------------------
1st Qtr. 2nd Qtr. 3rd Qtr. 4th Qtr. Annual
-------- -------- -------- -------- --------
Net Sales
Department Stores $ 3,573 $ 3,679 $ 3,782 $ 5,604 $ 16,638
Fingerhut 459 386 413 511 1,769
------- ------- ------- ------- --------
Total $ 4,032 $ 4,065 $ 4,195 $ 6,115 $ 18,407
------- ------- ------- ------- --------
------- ------- ------- ------- --------
Operating income
(Note 2)
Department Stores $ 288 $ 413 $ 300 $ 917 $ 1,918
Fingerhut (3) (168) (47) 16 (202)
Corporate and other
(Note 3) (32) (25) (49) (98) (204)
------- ------- ------- ------- --------
Total $ 253 $ 220 $ 204 $ 835 $ 1,512
------- ------- ------- ------- --------
------- ------- ------- ------- --------
Depreciation and
amortization
expense
Department Stores $ 151 $ 151 $ 155 $ 157 $ 614
Fingerhut 10 8 9 9 36
Corporate and other 24 23 22 14 83
------- ------- ------- ------- --------
Total $ 185 $ 182 $ 186 $ 180 $ 733
------- ------- ------- ------- --------
------- ------- ------- ------- --------
Fiscal 1999
--------------------------------------------------
1st Qtr. 2nd Qtr. 3rd Qtr. 4th Qtr. Annual
-------- -------- -------- -------- --------
Net Sales
Department Stores $ 3,470 $ 3,609 $ 3,691 $ 5,259 $ 16,029
Fingerhut 130 397 446 714 1,687
------- ------- ------- ------- --------
Total $ 3,600 $ 4,006 $ 4,137 $ 5,973 $ 17,716
------- ------- ------- ------- --------
------- ------- ------- ------- --------
Operating income
(Note 2)
Department Stores $ 259 $ 394 $ 323 $ 867 $ 1,843
Fingerhut 12 (23) 30 60 79
Corporate and other
(Note 3) (46) (53) (51) (71) (221)
------- ------- ------- ------- --------
Total $ 225 $ 318 $ 302 $ 856 $ 1,701
------- ------- ------- ------- --------
------- ------- ------- ------- --------
Depreciation and
amortization expense
Department Stores $ 153 $ 153 $ 158 $ 159 $ 623
Fingerhut 3 12 10 4 29
Corporate and other 17 22 23 24 86
------- ------- ------- ------- --------
Total $ 173 $ 187 $ 191 $ 187 $ 738
------- ------- ------- ------- --------
------- ------- ------- ------- --------
Notes:
(1) The Company is reorganizing its business segments for making
operating decisions and assessing performance for fiscal 2001.
The Company will conduct its business through two operating
segments: the department store segment, including related by-mail
and Internet operations, and Fingerhut. The above historical data
has been restated to reflect this change for analytical purposes.
(2) Operating income for fiscal 2000 excludes the impact of inventory
valuation adjustments related to the Fingerhut restructuring and
the asset impairment and restructuring charges.
(3) Corporate and other consists of the income or expense associated
with the corporate office and certain items managed on a
company-wide basis (e.g. intangibles, financial instruments,
investments, retirement benefits and properties held for sale or
disposition).
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