SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________________
FORM 10-Q
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended July 30, 1994
-------------
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________________________ to ____________________
Commission file number 1-8344
------
THE LIMITED, INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 31-1029810
- - -------------------------------- ----------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
Three Limited Parkway, P.O. Box 16000, Columbus, OH 43230
---------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (614) 479-7000
----------------------------
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 (or for such shorter period that the registrant
was required to file such reports), 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 of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at September 2, 1994
- - -------------------------------------- ----------------------------------
Common Stock, $.50 Par Value Shares 358,146,619
THE LIMITED, INC.
TABLE OF CONTENTS
Page No.
--------
Part I. Financial Information
Item 1. Financial Statements
Consolidated Statements of Income
Thirteen and Twenty-six Weeks Ended
July 30, 1994 and July 31, 1993. . . . . . . . . . 3
Consolidated Balance Sheets
July 30, 1994 and January 29, 1994 . . . . . . . . 4
Consolidated Statements of Cash Flows
Twenty-six Weeks Ended
July 30, 1994 and July 31, 1993. . . . . . . . . . 5
Notes to Consolidated Financial Statements . . . . . . . . . 6
Item 2. Management's Discussion and Analysis of
Results of Operations and Financial Condition. . . . . . 10
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . 16
PART I - FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
THE LIMITED, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Thousands except per share amounts)
(Unaudited)
Thirteen Weeks Ended Twenty-six Weeks Ended
-------------------- ----------------------
July 30, July 31, July 30, July 31,
1994 1993 1994 1993
---------- ---------- ---------- ----------
NET SALES $1,585,392 $1,689,055 $3,067,020 $3,207,616
Cost of Goods Sold, Occupancy
and Buying Costs 1,182,726 1,261,345 2,279,423 2,399,179
---------- ---------- ---------- ----------
GROSS INCOME 402,666 427,710 787,597 808,437
General, Administrative and
Store Operating Expenses 300,400 301,416 594,161 596,654
---------- ---------- ---------- ----------
OPERATING INCOME 102,266 126,294 193,436 211,783
Interest Expense (14,750) (16,349) (29,420) (31,337)
Other Income, net 1,316 1,287 4,092 3,011
---------- ---------- ---------- ----------
INCOME BEFORE INCOME
TAXES 88,832 111,232 168,108 183,457
Provision for Income Taxes 35,000 43,000 67,000 71,000
---------- ---------- ---------- ----------
NET INCOME $ 53,832 $ 68,232 $ 101,108 $ 112,457
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
NET INCOME PER SHARE $.15 $.19 $.28 $.31
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
DIVIDENDS PER SHARE $.09 $.09 $.18 $.18
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
WEIGHTED AVERAGE
SHARES OUTSTANDING 358,634 363,889 358,599 363,972
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
The accompanying notes are an integral part of these consolidated financial
statements.
3
THE LIMITED, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Thousands)
July 30, January 29,
ASSETS 1994 1994
------ ---------- ----------
(Unaudited)
CURRENT ASSETS:
Cash and Equivalents $ 108,250 $ 320,558
Accounts Receivable 1,120,038 1,056,911
Inventories 867,316 733,700
Other 133,187 109,456
---------- ----------
TOTAL CURRENT ASSETS 2,228,791 2,220,625
PROPERTY AND EQUIPMENT, NET 1,666,527 1,666,588
OTHER ASSETS 302,465 247,892
---------- ----------
TOTAL ASSETS $4,197,783 $4,135,105
---------- ----------
---------- ----------
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES:
Accounts Payable 320,008 250,363
Accrued Expenses 364,658 347,892
Certificates of Deposit 23,000 15,700
Income Taxes 29,798 93,489
---------- ----------
TOTAL CURRENT LIABILITIES 737,464 707,444
LONG-TERM DEBT 650,000 650,000
DEFERRED INCOME TAXES 266,077 275,101
OTHER LONG-TERM LIABILITIES 60,217 61,267
SHAREHOLDERS' EQUITY:
Common Stock 189,727 189,727
Paid-in Capital 130,401 128,906
Retained Earnings 2,433,788 2,397,112
---------- ----------
2,753,916 2,715,745
Less Treasury Stock,
at average cost (269,891) (274,452)
---------- ----------
TOTAL SHAREHOLDERS' EQUITY 2,484,025 2,441,293
---------- ----------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $4,197,783 $4,135,105
---------- ----------
---------- ----------
The accompanying notes are an integral part of these consolidated financial
statements.
4
THE LIMITED, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Thousands)
(Unaudited)
Twenty-six Weeks Ended
----------------------
July 30, July 31,
1994 1993
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $101,108 $112,457
Impact of other operating activities on cash flows:
Depreciation and amortization 127,928 139,029
Changes in assets and liabilities:
Accounts receivable (63,127) (27,367)
Inventories (133,616) (100,691)
Accounts payable and accrued expenses 86,411 101
Income taxes (63,691) (66,605)
Other assets and liabilities (73,656) (32,290)
-------- --------
NET CASH (USED FOR) PROVIDED FROM OPERATING
ACTIVITIES (18,643) 24,634
-------- --------
CASH USED FOR INVESTING ACTIVITIES
Capital expenditures (142,588) (161,952)
-------- --------
FINANCING ACTIVITIES:
Net proceeds of (repayments) commercial paper
borrowings and certificates of deposit 7,300 (28,222)
Proceeds from issuance of unsecured notes - 250,000
Dividends paid (64,433) (65,299)
Stock options and other 6,056 3,002
-------- --------
NET CASH (USED FOR) PROVIDED FROM FINANCING
ACTIVITIES (51,077) 159,481
-------- --------
NET (DECREASE) INCREASE IN CASH AND
EQUIVALENTS (212,308) 22,163
Cash and equivalents, beginning of year 320,558 41,235
-------- --------
CASH AND EQUIVALENTS, END OF PERIOD $108,250 $63,398
-------- --------
-------- --------
The accompanying notes are an integral part of these consolidated financial
statements.
5
THE LIMITED, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. BASIS OF PRESENTATION
The consolidated financial statements include the accounts of The Limited,
Inc. (the "Company") and all significant subsidiaries which are more than
50 percent owned and controlled. All significant intercompany balances and
transactions have been eliminated in consolidation.
Investments in other entities (including joint ventures) which are more
than 20 percent owned are accounted for on the equity method.
The consolidated financial statements as of and for the periods ended July
30, 1994 and July 31, 1993 are unaudited and are presented pursuant to the
rules and regulations of the Securities and Exchange Commission.
Accordingly, the consolidated financial statements should be read in
conjunction with the financial statement disclosures contained in the
Company's 1993 Annual Report. In the opinion of management, the
accompanying consolidated financial statements reflect all adjustments
(which are of a normal recurring nature) necessary to present fairly the
financial position and results of operations and cash flows for the interim
periods, but are not necessarily indicative of the results of operations
for a full fiscal year.
The consolidated financial statements as of July 30, 1994 and for the
thirteen and twenty-six week periods ended July 30, 1994 and July 31, 1993
included herein have been reviewed by the independent accounting firm of
Coopers & Lybrand and the report of such firm follows the notes to
consolidated financial statements.
2. INVENTORIES
The fiscal year of the Company and its subsidiaries is comprised of two
principal selling seasons: Spring (the first and second quarters) and Fall
(the third and fourth quarters). Valuation of finished goods inventories
is based principally upon the lower of average cost or market determined on
a first-in, first-out basis utilizing the retail method. Inventory
valuation at the end of the first and third quarters reflects adjustments
for inventory markdowns and shrinkage estimates for the total selling
season.
3. INCOME TAXES
The provision for income taxes is based on the current estimate of the
annual effective tax rate. Income taxes paid during the twenty-six weeks
ended July 30, 1994 and July 31, 1993 approximated $130.4 million and
$136.1 million.
The Internal Revenue Service has assessed the Company for additional taxes
and interest for 1989 and 1990. The assessment was based primarily on the
treatment of transactions involving the Company's foreign operations and
construction allowances. The Company strongly disagrees with the
assessment and is vigorously contesting the matter. Management believes
resolution of this matter will not have a material adverse effect on the
Company's results of operations or financial condition.
6
4. FINANCING ARRANGEMENTS
Long-term debt consisted of ($000):
July 30, January 29,
1994 1994
-------- -----------
7 1/2% Debentures due March, 2023 $250,000 $250,000
7.80% Notes due May, 2002 150,000 150,000
9 1/8% Notes due February, 2001 150,000 150,000
8 7/8% Notes due August, 1999 100,000 100,000
-------- --------
$650,000 $650,000
-------- --------
-------- --------
Effective April 28, 1994, the Company amended its two revolving credit
agreements (the "Agreements") totaling $840 million. One Agreement
provides the Company available borrowings of up to $490 million. The other
Agreement provides World Financial Network National Bank, a wholly-owned
consolidated subsidiary, available borrowings of up to $350 million.
Borrowings outstanding under the Agreements are due December 4, 1999.
However, the revolving terms of each of the Agreements may be extended an
additional two years upon notification by the Company at least 60 days
prior to December 4, 1996, subject to the approval of the lending banks.
Both Agreements have similar borrowing options, including interest rates
which are based on either the lender's "Base Rate", as defined, LIBOR, CD
based options or at a rate submitted under a bidding process. Aggregate
commitment and facility fees for the Agreements approximate 0.11% of the
total commitment. The Agreements place restrictions on the amount of the
Company's working capital, debt and net worth. No amounts were outstanding
under the Agreements at July 30, 1994.
The Agreements support the Company's commercial paper program which funds
working capital and other general corporate requirements. No commercial
paper was outstanding at July 30, 1994.
Under the Company's shelf registration statement, up to $250 million of
debt securities and warrants to purchase debt securities may be issued.
All long-term debt outstanding at July 30, 1994 and January 29, 1994 is
unsecured.
Interest paid during the twenty-six weeks ended July 30, 1994 and July 31,
1993 approximated $24.1 million and $21.7 million.
7
5. PROPERTY AND EQUIPMENT, NET
Property and equipment, net, consisted of ($000):
July 30, January 29,
1994 1994
---------- -----------
Property and equipment, at cost $2,710,479 $2,638,197
Accumulated depreciation and amortization (1,043,952) (971,609)
---------- ----------
Property and equipment, net $1,666,527 $1,666,588
---------- ----------
---------- ----------
6. SPECIAL AND NONRECURRING ITEMS
During the third quarter of 1993, the Company approved a plan which
includes the following components: the sale of a 60% interest in the
Brylane mail order business; the acceleration of the store remodeling,
downsizing and closing program at the Limited Stores and Lerner divisions;
and the refocusing of the merchandise strategy at the Henri Bendel
division.
The remodeling, downsizing and closing program includes approximately 360
Limited and Lerner stores and is expected to be completed by the end of
1995. The Company had closed approximately 85 of these stores and
remodeled approximately 95 of these stores as of July 30, 1994.
The net impact of the plan is anticipated to be immaterial to future
operations.
8
[COOPERS & LYBRAND LETTERHEAD]
REPORT OF INDEPENDENT ACCOUNTANTS
To the Audit Committee of
The Board of Directors of
The Limited, Inc.
We have reviewed the condensed consolidated balance sheet of The Limited, Inc.
and Subsidiaries at July 30, 1994, and the related condensed consolidated
statements of income and cash flows for the thirteen-week and twenty-six-week
periods ended July 30, 1994 and July 31, 1993. These financial statements are
the responsibility of the Company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the accompanying financial statements for them to be in conformity
with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet as of January 29, 1994, and the
related consolidated statements of income, shareholders' equity, and cash flows
for the year then ended (not presented herein); and in our report dated February
14, 1994 we expressed an unqualified opinion on those consolidated financial
statements. In our opinion, the information set forth in the accompanying
condensed consolidated balance sheet as of January 29, 1994, is fairly stated,
in all material respects, in relation to the consolidated balance sheet from
which it has been derived.
/s/ Coopers & Lybrand L.L.P
COOPERS & LYBRAND L.L.P.
Columbus, Ohio
September 8, 1994
9
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION
RESULTS OF OPERATIONS
During the second quarter of 1994, net sales increased 1% to $1.585 billion
compared to $1.563 billion a year ago (excluding Brylane sales). Net income for
the quarter was $53.8 million compared to $68.2 million last year and earnings
per share were $.15 compared to $.19 per share in 1993.
Divisional highlights include the following:
Victoria's Secret Stores operating income was up significantly over last
year and was their best ever second quarter operating income rate.
Victoria's Secret Catalogue generated significant sales and operating
income increases.
Structure continued to produce strong sales gains.
Abercrombie & Fitch improved margins dramatically and, as a consequence,
had a significantly improved bottom line.
Bath & Body Works delivered a significant increase in sales and the highest
store-for-store sales gains in the Company.
Limited Too produced meaningful sales and operating income improvements.
The comparable store sales of the women's apparel businesses (Express, Lerner,
Limited Stores, Lane Bryant and Henri Bendel) decreased 13%, consistent with the
sales pattern seen in the first quarter. As a consequence, these businesses, in
aggregate, produced lower second quarter operating income than last year.
Sales for the twenty-six weeks ended July 30, 1994 increased 3% over the same
period in 1993 (excluding Brylane sales). Operating income decreased 9% to
$193.4 million, while net income decreased 10% to $101.1 million. Earnings per
share decreased 10% to $.28 per share.
10
FINANCIAL SUMMARY
The following summarized financial data compares the thirteen and twenty-six
week periods ended July 30, 1994 to the comparable periods for 1993:
Change Change
From From
Second Quarter Prior Year-to-Date Prior
1994 1993 Period 1994 1993 Period
------ ------ ------ ------- ------- ------
Retail Sales (millions) $1,445 $1,460 (1%) $2,804 $2,758 2%
Catalogue Sales (millions) 140 229 (39%) 263 450 (42%)
------ ------ ------ ------ ------ ------
Total Net Sales (millions) $1,585 $1,689 (6%) $3,067 $3,208 (4%)
------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------
Increase (Decrease) in
Comparable Store Sales (7%) 4% (4%) 1%
Retail Sales Increase
Attributable to New and
Remodeled Stores 6% 9% 6% 8%
Retail Sales per Average
Selling Square Foot $58.52 $62.62 (7%) $113.86 $119.06 (4%)
Retail Sales per Average Store
(thousands) $310 $327 (5%) $602 $619 (3%)
Average Store Size at End of
Quarter (square feet) 5,287 5,237 1%
Number of Stores:
Beginning of Period 4,641 4,457 4% 4,623 4,425 4%
Opened 71 58 121 116
Closed (16) (34) (48) (60)
----- ----- ------ ------ ------ ------
End of Period 4,696 4,481 5% 4,696 4,481 5%
----- ----- ------ ------ ------ ------
----- ----- ------ ------ ------ ------
11
NET SALES
Retail sales for the second quarter of 1994 decreased 1% from the second quarter
of 1993 primarily due to the decline in sales productivity at the Company's
women's apparel divisions where comparable store sales decreased 13%. The non-
women's apparel businesses (lingerie, men's, girl's and personal care) had
comparable store sales increases of over 10%.
The year-to-date 1994 retail sales increase of 2% is a result of a 15% increase
in comparable store sales at the non-women's apparel businesses combined with 6%
increase in sales attributable to new and remodeled stores. Women's apparel
comparable store sales for the year-to-date period declined 10%.
Catalogue sales decreased 39% in the second quarter due to Brylane sales being
excluded in the second quarter of 1994. Had the second quarter of 1993 excluded
Brylane, catalogue sales would have increased 37% as the number of books mailed
increased significantly and was somewhat offset by a slight decline in the
average demand per book.
Year-to-date catalogue sales decreased 42% due to Brylane sales being excluded
in the 1994 year-to-date results. Had 1993 excluded Brylane, catalogue sales
would have increased over 26% as the number of books mailed increased
significantly and average demand per book also increased slightly.
# of Stores Selling Sq. Ft. (000's)
-------------------------- --------------------------
Change Change
From From
July 30, July 31, Prior July 30, July 31, Prior
1994 1993 Period 1994 1993 Period
-------- -------- ------ -------- -------- ------
Express 690 650 40 4,090 3,609 481
Lerner 864 897 (33) 6,694 6,897 (203)
Limited Stores 726 748 (22) 4,444 4,352 92
Lane Bryant 815 813 2 3,858 3,815 43
Henri Bendel 4 4 0 93 93 0
Victoria's Secret Stores 578 559 19 2,430 2,155 275
Cacique 109 92 17 324 260 64
Structure 417 355 62 1,523 1,225 298
Abercrombie & Fitch 56 41 15 462 343 119
Bath & Body Works 244 131 113 338 146 192
Penhaligon's 7 6 1 3 3 0
Limited Too 186 185 1 570 568 2
----- ----- --- ------ ------ -----
Total Stores and
Selling Square
Feet 4,696 4,481 215 24,829 23,466 1,363
----- ----- --- ------ ------ -----
----- ----- --- ------ ------ -----
12
GROSS INCOME
Gross income increased as a percentage of sales to 25.4% for the second quarter
of 1994 from 25.3% for the same period in 1993. Merchandise margins, expressed
as a percentage of sales, increased 2.2% as the Company continued to be less
price promotional than a year earlier. Buying and occupancy costs, which
increased 2.1% as a percentage of sales, somewhat offset this impact, due to
lower sales productivity associated with the 7% decrease in comparable store
sales.
The 1994 year-to-date gross income rate increased .5% to 25.7% as compared to
1993. Merchandise margins, expressed as a percentage of sales, increased 2.5%
due to the Company's less promotional pricing strategy, offset somewhat by an
increase in buying and occupancy costs resulting from a 4% decline in sales
productivity.
GENERAL, ADMINISTRATIVE AND STORE OPERATING EXPENSES
General, administrative and store operating expenses decreased in absolute
dollars but increased as a percentage of sales to 18.9% in the second quarter of
1994 from 17.8% for the same period in 1993. Sales productivity which is
initially lower in new and remodeled stores was also lower in existing stores.
The Company continues to maintain its high level of customer service,
particularly at its women apparel businesses even though comparable store sales
were down 13%.
Year-to-date general, administrative and store operating expenses were also
lower in absolute dollars but as a percentage of sales were 19.4% in 1994
compared to 18.6% in 1993. This increase was due to lower sales productivity at
both existing stores and new, remodeled and expanded stores. The Company
expects to continue its policy of maintaining a high level of customer service.
OPERATING INCOME
Year-to-date operating income, as a percentage of sales, was 6.3% and 6.6% in
1994 and 1993. The Company incurred higher general, administrative and store
operating expenses that were not entirely offset by higher merchandise margins.
INTEREST EXPENSE
Second Quarter Year-to-Date
--------------- ----------------
1994 1993 1994 1993
------ ------ ------ ------
Average Borrowings $678.3 $854.0 $679.8 $814.3
(in millions)
Average Effective Interest Rate 8.70% 7.66% 8.66% 7.70%
Interest expense decreased in the second quarter and year-to-date periods of
1994 as compared to the comparable periods of 1993. Higher interest rates
increased interest costs approximately $1.8 million and $3.3 million during the
second quarter and year-to-date periods. Lower borrowing levels reduced
interest costs approximately $3.4 million and $5.2 million during the second
quarter and year-to-date periods.
13
FINANCIAL CONDITION
LIQUIDITY AND CAPITAL RESOURCES
Cash provided from operating activities, commercial paper backed by funds
available under committed long-term credit agreements and the Company's capital
structure continue to provide the resources to support operations, including
projected growth, seasonal requirements and capital expenditures. A summary of
the Company's working capital position and capitalization follows ($000):
July 30, January 29,
1994 1994
---------- ----------
Working Capital $1,491,327 $1,513,181
---------- ----------
---------- ----------
Capitalization -
Long-term debt $ 650,000 $ 650,000
Deferred income taxes 266,077 275,101
Shareholders' equity 2,484,025 2,441,293
---------- ----------
Total Capitalization $3,400,102 $3,366,394
---------- ----------
---------- ----------
Additional amounts available under committed
long-term credit agreements $ 840,000 $ 840,000
---------- ----------
---------- ----------
Net cash used for operating activities was $18.6 million for the twenty-six
weeks ended July 30, 1994 versus $24.6 million net cash provided from operating
activities for the same period of 1993. Cash requirements for accounts
receivable grew in the twenty-six weeks ended July 30, 1994 compared to the same
period in 1993 due to the introduction of proprietary credit cards at Limited
Stores and Structure in the Fall of 1993. Additionally, cash requirements for
inventories were primarily due to the net addition of approximately 1.4 million
selling square feet which was somewhat offset by conservatively planned
inventory levels at our women's apparel businesses. Cash requirements for other
assets and liabilities related primarily to a deposit made to the Internal
Revenue Service in connection with an assessment for additional taxes and
interest for 1989 and 1990 which is described in note 3 to the financial
statements.
14
CAPITAL EXPENDITURES
Capital expenditures totaled $142.6 million during the twenty-six weeks ended
July 30, 1994, compared to $162.0 million for the comparable period of 1993.
The Company anticipates spending approximately $350 - $375 million for capital
expenditures in 1994, of which approximately $250 - $275 million will be for new
stores, the remodeling of existing stores, and fixturing and related
improvements for the retail businesses. The Company anticipates spending
approximately $10 million for a 24-hour telephone catalogue sales center in
Kettering, Ohio to expand Victoria's Secret Catalogue operations.
Through the end of the second quarter, a total of 0.4 million net selling square
feet was added. Based upon current store design and construction schedules, the
Company expects to add approximately 1.2 million net additional selling square
feet over the balance of the year.
The Company presently anticipates that substantially all 1994 capital
expenditures will be funded by net cash provided from operating activities. In
addition, the Company presently has available $840 million under committed,
unsecured long-term credit agreements as well as the ability to offer up to $250
million of additional debt securities and warrants to purchase debt securities
under its shelf registration statement authorization.
15
PART II - OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS.
4. Instruments Defining the Rights of Security Holders.
4.1. Copy of the form of Global Security representing the
Company's 7 1/2% Debentures due 2023, incorporated by
reference to Exhibit 1 to the Company's Current Report on
Form 8-K dated March 4, 1993.
4.2. $900,000,000 Credit Agreement dated as of August 30, 1990
(the "Credit Agreement") among the Company, Morgan Guaranty
Trust Company of New York and certain other banks
(collectively, the "Banks"), incorporated by reference to
Exhibit 4.7 to the Company's Quarterly Report on Form 10-Q
for the quarter ended August 4, 1990, as amended by
Amendment No. 1 dated as of December 4, 1992 (reducing the
aggregate amount to $560,000,000), incorporated by reference
to Exhibit 4.8 to the Company's Quarterly Report on Form
10-Q for the quarter ended October 31, 1992.
4.3. $280,000,000 Credit Agreement dated as of December 4, 1992
(the "WFNNB Credit Agreement") among the World Financial
Network National Bank, the Company, the Banks and Morgan
Guaranty Trust Company of New York, incorporated by
reference to Exhibit 4.9 to the Company's Quarterly Report
on Form 10-Q for the quarter ended October 31, 1992.
4.4. Conformed copy of the Indenture dated as of March 15, 1988
between the Company and The Bank of New York, incorporated
by reference to Exhibit 4.1(a) to the Company's Current
Report on Form 8-K dated March 21, 1989.
4.5. Copy of the form of Global Security representing the
Company's 8 7/8% Notes due August 15, 1999 incorporated by
reference to Exhibit 4.1 to the Company's Current Report on
Form 8-K dated August 14, 1989.
4.6. Copy of the form of Global Security representing the
Company's 9 1/8% Notes due February 1, 2001 incorporated by
reference to Exhibit 4.1 to the Company's Current Report on
Form 8-K dated February 6, 1991.
4.7. Proposed form of Debt Warrant Agreement for Warrants
attached to Debt Securities, with proposed form of Debt
Warrant Certificate incorporated by reference to Exhibit 4.2
to the Company's Registration Statement on Form S-3 (File
no. 33-53366) originally filed with the Securities and
Exchange Commission (the "Commission") on October 16, 1992
as amended by Amendment No. 1 thereto, filed with the
Commission on February 23, 1993 (the "1993 Form S-3").
4.8. Proposed form of Debt Warrant Agreement for Warrants not
attached to Debt Securities, with proposed form of Debt
Warrant Certificate incorporated by reference to Exhibit 4.3
to the 1993 Form S-3.
16
4.9. Amendment No. 2 dated as of April 28, 1994 to the Credit
Agreement among the Company, Morgan Guaranty Trust Company
of New York and the Banks.
4.10. Amendment No. 1 dated as of April 28, 1994 to the WFNNB
Credit Agreement among the Company, Morgan Guaranty Trust
Company of New York and the Banks.
11. Statement re: Computation of Per Share Earnings.
12. Statement re: Computation of Ratio of Earnings to Fixed Charges.
15. Letter re: Unaudited Interim Financial Information to Securities and
Exchange Commission re: Incorporation of Accountants' Report.
27. Financial Data Schedule.
(b) REPORTS ON FORM 8-K.
None.
17
SIGNATURE
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 thereunto duly authorized.
THE LIMITED, INC.
(Registrant)
By: /S/ Kenneth B. Gilman
-----------------------------------
Kenneth B. Gilman,
Vice Chairman and Chief
Financial Officer*
Date: September 9, 1994
- - -------------------------------------
* Mr. Gilman is the principal financial officer and has been duly authorized to
sign on behalf of the Registrant.
18
EXHIBIT INDEX
Exhibit No. Document
- - ----------- -------------------------------------------------------
11 Statement re: Computation of
Per Share Earnings.
12 Statement re: Ratio of
Earnings to Fixed Charges.
15 Letter re: Unaudited Interim Financial Information re:
Incorporation of Report of Independent Accountants
27 Financial Data Schedule
19
EXHIBIT 11
THE LIMITED, INC. AND SUBSIDIARIES
COMPUTATION OF PER SHARE EARNINGS
(Thousands except per share amounts)
Thirteen Weeks Ended
---------------------
July 30, July 31,
1994 1993
-------- --------
Net income $ 53,832 $ 68,232
-------- --------
-------- --------
Common shares outstanding:
Weighted average 379,454 379,454
Dilutive effect of stock options 553 1,022
Weighted average treasury shares (21,373) (16,587)
-------- --------
Weighted average used to calculate
net income per share 358,634 363,889
-------- --------
-------- --------
Net income per share $.15 $.19
-------- --------
-------- --------
Twenty-six Weeks Ended
----------------------
July 30, July 31,
1994 1993
-------- ---------
Net income $101,108 $112,457
-------- --------
-------- --------
Common shares outstanding:
Weighted average 379,454 379,454
Dilutive effect of stock options 612 1,173
Weighted average treasury shares (21,467) (16,655)
-------- --------
Weighted average used to calculate
net income per share 358,599 363,972
-------- --------
-------- --------
Net income per share $.28 $.31
-------- --------
-------- --------
20
EXHIBIT 12
THE LIMITED, INC. AND SUBSIDIARIES
RATIO OF EARNINGS TO FIXED CHARGES
(Thousands except ratio amounts)
Twenty-six Weeks Ended
------------------------
July 30, July 31,
1994 1993
-------- --------
ADJUSTED EARNINGS
Income before income taxes $168,108 $183,457
Portion of minimum rent ($303,864 in 1994
and $286,364 in 1993) representative
of interest 101,288 95,455
Interest on indebtedness 29,420 31,337
-------- --------
Total Earnings as Adjusted $298,816 $310,249
-------- --------
-------- --------
FIXED CHARGES
Portion of minimum rent representative
of interest $101,288 $ 95,455
Interest on indebtedness 29,420 31,337
-------- --------
Total Fixed Charges $130,708 $126,792
-------- --------
-------- --------
Ratio of Earnings to Fixed Charges 2.29x 2.45x
-------- --------
-------- --------
21
EXHIBIT 15
[COOPERS & LYBRAND LETTERHEAD]
Securities and Exchange Commission
450 5th Street, N.W.
Judiciary Plaza
Washington, D.C. 20549
We are aware that our report dated September 8, 1994, on our review of the
interim consolidated financial information of The Limited, Inc. and Subsidiaries
for the thirteen-week and twenty-six-week periods ended July 30, 1994 and
included in this Form 10-Q is incorporated by reference in the Company's
registration statements on Form S-8, Registration Nos. 33-18533, 33-25005,
2-92277, 33-24829, 33-24507, 33-24828, 2-95788, 2-88919, 33-24518, 33-6965,
33-14049, 33-22844, 33-44041, 33-49871, and the registration statements on Form
S-3, Registration Nos. 33-20788, 33-31540, 33-43832, and 33-53366. Pursuant to
Rule 436(c) under the Securities Act of 1933, this report should not be
considered a part of the registration statement prepared or certified by us
within the meaning of Sections 7 and 11 of that Act.
/s/ Coopers & Lybrand L.L.P
COOPERS & LYBRAND L.L.P.
Columbus, Ohio
September 8, 1994
22
5
1,000
6-MOS
JAN-29-1994
JAN-30-1994
JUL-30-1994
108,250
0
1,154,789
34,751
867,316
2,228,791
2,710,479
1,043,952
4,197,783
737,464
650,000
189,727
0
0
2,294,298
4,197,783
3,067,020
3,067,020
2,279,423
0
590,069
0
(29,420)
168,108
67,000
101,108
0
0
0
101,108
.28
0
