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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): NOVEMBER 12, 2001
MICHAELS STORES, INC.
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 001-09338 75-1943604
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
8000 BENT BRANCH DRIVE
IRVING, TEXAS 75063-6041
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (972) 409-1300
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ITEM 5. OTHER EVENTS.
(a) SELECTED FINANCIAL DATA.
On October 31, 2001, the Board of Directors of Michaels Stores, Inc. (the
"Company") declared a two-for-one common stock split effected in the form of
a stock dividend to stockholders of record as of the close of business on
November 12, 2001, payable on November 26, 2001. The selected financial data
set forth below reflects earnings per share amounts adjusted to reflect the
stock split on a retroactive basis.
FISCAL YEAR
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2000 (1)(2) 1999 1998 1997 1996 (1)(3)
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(IN THOUSANDS EXCEPT PER SHARE AND STORE DATA)
RESULTS OF OPERATIONS:
Net sales.............................. $2,249,440 $1,882,522 $1,573,965 $1,456,524 $1,378,277
Operating income (loss)................ 148,417 122,672 89,112 68,942 (20,987)
Net income (loss)...................... 78,589 62,301 43,601 30,077 (31,233)
Diluted earnings (loss) per common
share (4)............................ 1.15 1.00 0.71 0.52 (0.67)
BALANCE SHEET DATA:
Cash and equivalents................... $ 28,191 $ 77,398 $ 96,124 $ 162,283 $ 59,069
Merchandise inventories................ 663,700 615,065 501,239 385,580 351,208
Total current assets................... 729,816 722,987 621,928 573,183 437,543
Total assets........................... 1,158,436 1,096,703 962,650 908,494 784,435
Working capital........................ 440,808 452,011 391,227 358,691 239,812
Long-term debt......................... 125,145 224,635 230,896 234,889 238,608
Total liabilities...................... 453,790 529,905 481,671 466,583 451,633
Stockholders' equity................... 704,646 566,798 480,979 441,911 332,802
OTHER FINANCIAL DATA:
Cash flow from operating activities.... $ 146,758 $ 60,770 $ 6,038 $ 77,907 $ 29,749
Cash flow from investing activities.... (120,084) (90,759) (59,567) (38,988) (32,312)
Cash flow from financing activities.... (75,881) 11,263 (12,630) 64,295 58,762
EBITDA (5)............................. 217,425 184,251 143,255 117,589 21,694
STORES OPEN AT END OF YEAR:
Michaels............................... 628 559 496 452 453
Aaron Brothers......................... 119 95 78 74 72
Star Wholesale......................... 1 - - - -
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Total stores open at end of year....... 748 654 574 526 525
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(1) Fiscal 2000 and 1996 were both 53-week fiscal years. All other fiscal
years included in the above table were 52-week fiscal years.
(2) Fiscal 2000 net income and diluted earnings per common share include the
cumulative effect of a change in accounting principle, net of tax, in the
amount of $1.9 million, or $0.06 per diluted share. EBITDA for fiscal
2000 includes the pretax cumulative effect of a change in accounting
principle of $3.1 million. See Note 2 of Notes to Consolidated Financial
Statements included in the Company's Annual Report on Form 10-K for the
fiscal year ended February 3, 2001.
(3) Operating income in fiscal 1996 includes the effect of an unusual pre-tax
charge of $41.2 million for costs associated with the sale to liquidate
merchandise that was eliminated following store resets, markdowns on
discontinued furniture and other home decor merchandise, and reserves for
the closure of four stores and the write-down of leasehold improvements
in three stores.
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(4) On October 31, 2001, the Company's Board of Directors declared a
two-for-one common stock split effected in the form of a stock dividend
to stockholders of record as of the close of business on November 12,
2001, payable on November 26, 2001. All references to earnings per share
amounts in the above table have been adjusted to reflect the stock split
on a retroactive basis.
(5) EBITDA is calculated as income before income taxes plus interest,
depreciation, and amortization. EBITDA is presented because it is a
widely accepted financial indicator of a company's ability to incur and
service debt, but is not a financial measurement recognized by generally
accepted accounting principles, and therefore, may not be comparable to
similarly titled measures used by other entities. EBITDA should not be
considered by an investor as an alternative to net income, as an
indicator of the operating performance of the Company, or as an
alternative to cash flow as a measure of liquidity.
(b) LITIGATION.
On February 1, 2002, the Company issued a press release announcing that
its subsidiary, Aaron Brothers, Inc., has reached a tentative agreement to
settle the COLLINS V. AARON BROTHERS, INC. lawsuit previously disclosed in
the Company's periodic filings with the Securities and Exchange Commission.
The settlement is subject to final documentation and court approval.
A copy of the press release is filed as Exhibit 99.1 to this Form 8-K.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) EXHIBITS.
Exhibit
Number Description
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99.1 Press Release, dated February 1, 2002.
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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.
MICHAELS STORES, INC.
By: /s/ Bryan M. DeCordova
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Bryan M. DeCordova, Executive Vice
President -- Chief Financial Officer
Date: March 8, 2002
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INDEX TO EXHIBITS
Exhibit
Number Description
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99.1 Press Release, dated February 1, 2002.
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