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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended July 2,1994
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 1-10095
DELTA WOODSIDE INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
South Carolina 57-0535180
(State of Incorporation) (I.R.S. Employer Identification No.)
233 N. Main Street, Hammond Square, Suite 200
Greenville, South Carolina
29601
(Address of principal executive offices) (Zip code)
803/232-8301
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
Common Stock, Par Value $.01 New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
Title of each class
None
1
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
Exhibit Index at Page No.__19
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K ( 229.405 of this chapter)
is not contained herein, and will not be contained, to be best of
registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-
K or any amendment to this Form 10-K [ ].
The aggregate market value of the voting stock held by non-
affiliates of the registrant as of September 7, 1994 was :
Common Stock, $.01 par value - $170,101,772
The number of shares outstanding of each of the registrant's
classes of Common Stock, as of September 7, 1994 was:
Common Stock, par value $.01 24,305,122 shares
DOCUMENTS INCORPORATED BY REFERENCE: Portions of the Company's
Annual Report to shareholders for the fiscal year ended July 2,
1994 are incorporated by reference into Parts I and II.
Portions of the Company's definitive Proxy Statement to be filed
pursuant to Regulation 14A for the annual shareholders' meeting
to be held on November 10, 1994, are incorporated by reference
into Part III.
2
Part I
Item 1. BUSINESS
General
Delta Woodside Industries, Inc. ("Delta Woodside" or the
"Company") is a South Carolina corporation with its principal
executive offices located at 233 North Main Street, Hammond
Square, Suite 200, Greenville, South Carolina 29601 (telephone
number: 803-232-8301). All references herein to Delta Woodside
or the Company refer to Delta Woodside Industries, Inc., its
subsidiaries and its predecessor, Delta Woodside Industries,
Inc., a Delaware corporation (which was incorporated in 1986),
unless the context otherwise indicates.
The Company manufactures and markets woven and knitted
fabrics and apparel. The Company's textile segment produces a
range of cotton, synthetic and blended fabrics, woven and knit,
which are sold for the ultimate production of apparel, home
furnishings and other products. The Company's apparel segment
produces woven and knit apparel, including the "Duck Head" (Reg.
trademark) line of casualwear marketed primarily in the
Southeastern United States to department stores and specialty
apparel retailers. The Company also operates 36 retail apparel
outlet stores that sell primarily closeout and irregular "Duck
Head" products and other woven and knit casualwear produced by
the "Duck Head" division and other manufacturers. The Company
also manufactures and distributes physical fitness equipment
under the "Nautilus" (Reg. trademark) name. In June 1994, the
Company sold its office products business. The Company has
operations in 15 states and Costa Rica and employs approximately
8,100 employees.
Products, Marketing and Manufacturing
The Company conducts its textile fabrics operations through
the Delta Mills Marketing (woven fabrics) and Stevcoknit (knitted
fabrics) divisions. It conducts its woven and its knit apparel
operations through the "Duck Head" and "Delta Apparel" (Reg.
trademark) divisions. Certain retail sales of "Duck Head" and
other manufacturers' products are made through the "Duck Head"
Retail outlet stores. Each division has its own management and
employees and operates independently of the other divisions.
Inter-segment sales in fiscal 1994, fiscal 1993 and 1992
accounted for no more than approximately 4%, 3% and 3%,
respectively, of the total sales of any segment.
Fabrics produced by Delta Woodside are either woven or
knitted and are manufactured from cotton, wool or synthetic
fibers or from synthetic filament yarns. Cotton and wool are
purchased from
numerous suppliers. Synthetic fiber and synthetic filament yarns
are purchased from a smaller number of competitive suppliers.
4
The Company sells its woven fabrics primarily to numerous
apparel manufacturers and apparel and fabric resellers, including
Levi, Haggar and Farah and private label apparel manufacturers
for J. C. Penney, Sears and other retailers. The Company's
knitted fabrics are sold for production of apparel for ultimate
sales to catalogue companies, as well as to other branded and
private label manufacturers. Apparel products are sold primarily
to department and specialty retailers under the Company's "Duck
Head" label, to private label apparel resellers and to screen
printers.
Textile Segment
The textile segment manufactures and markets woven and
knitted fabrics to manufacturers of apparel and home furnishings
and other products. The Company's net sales of woven fabrics
were $288.6 million, $325.1 million and $336.9 million and the
Company's net sales of knit fabrics were $102.8 million, $119.9
million and $135.9 million, during fiscal 1994, 1993 and 1992,
respectively.
Delta Mills Marketing Company (Woven Fabrics). Delta Mills
Marketing Company produces finished and unfinished woven fabrics
used in the production of apparel, home furnishings and other
products. "Finished" fabric refers to fabric which has been
treated by washing, bleaching, dyeing and applying certain
chemical finishes. Finished apparel fabric is ready to be cut
and sewn into garments and is typically sold to manufacturers of
apparel.
Unfinished fabric, commonly referred to as "greige" (pronounced
"gray") goods, is typically sold to converters who subsequently
finish the fabric and sell it to manufacturers of apparel, home
furnishings and other products. Through fiscal 1990, the
Company's finished and unfinished woven fabric businesses
operated as separate divisions under the names "Delta Mills
Marketing Company" and "Woodside Mills, Inc." The two businesses
together now comprise Delta Mills Marketing Company.
Item 1 (Continued)
Finished Woven Fabrics. The Company's finished woven
fabrics operation, through 7 of its plants, manufactures medium-
weight woven fabrics sold in a finished state for use in the
manufacture of men's and women's apparel and professional
uniforms.
Finished woven fabrics produced by the division are
primarily sold directly to major apparel manufacturers. The
division's marketing efforts focus on four primary apparel
manufacturing groups: women's apparel, including fashion
apparel; men's apparel; career apparel and uniforms; and military
5
and other government uniforms and apparel. The division also
engages in commission finishing, whereby it finishes fabric for
converters. The finished woven fabrics operation sells and
distributes its fabrics through Delta Mills Sales Company, a
marketing office based in New York City, with sales personnel
also operating from Atlanta, Chicago, Dallas, Los Angeles, San
Francisco and London.
Approximately 65% of the division's finished woven fabrics
are made from cotton or cotton/synthetic blends, while
approximately 35% are made from spun synthetics, including
varying blends of rayon, polyester and wool. Finished woven
fabrics are principally woven according to projected sales based
on strong indications from major customers, but finished
according to specific purchase orders. The division's production
of cotton and cotton/synthetic blend finished woven fabrics is
largely integrated, with the division performing most of its own
spinning and substantially all of its own weaving and finishing.
The production of spun synthetic finished woven fabrics is fully
integrated, with various plants in the division involved in
spinning, weaving and finishing. With its printing capability,
the Company believes that the division is the only substantially
vertically integrated producer of camouflage military fabrics in
the United States. The Company expects that its finished woven
all cotton facilities will run at or near full capacity during
fiscal 1995. However, woven synthetic and greige goods
facilities are not expected to run full schedules for at least
the first half of fiscal 1995.
Unfinished Woven Fabrics. The division, through the three
plants included in its Woodside operation, produces a variety of
unfinished light-weight woven fabrics sold for ultimate use in
manufacturing apparel such as blouses, dresses and pajamas, and
in manufacturing home furnishings, including draperies, curtains
and comforters, and in medical and industrial products.
The Woodside operation sells its products primarily to
converters who arrange for the dyeing, printing and finishing of
the fabric before ultimately selling the fabric to apparel, home
furnishing and other manufacturers. Woodside's marketing and
sales are also performed by Delta Mills Sales Company, through
its offices in New York City and additional sales personnel in
the Boston, Massachusetts area. The Company sells to more than
150 converters and other customers. Woodside's operations are
designed to allow for changes in production to different items in
its various product lines, thus allowing it to respond to shifts
in market demand. Orders generally are received three to six
months in advance, with products generally made to customer
specifications.
Fabrics sold by the Woodside operation include 100% cotton,
polyester/cotton blends, 100% polyester, 100% rayon,
polyester/rayon blends, textured polyester and other "semifancy"
fabrics of more complicated construction. The Woodside operation
also produces acetate fabrics used for apparel linings, surgical
6
tapes and other industrial and home furnishing uses. Woodside's
operations are largely integrated. All of the operation's plants
weave fabrics and one of the plants spins some of the yarn used
to manufacture these fabrics. The Woodside operation currently
is operating at less than full production capacity.
Stevcoknit (Knitted Fabrics). Stevcoknit, through its 5
plants, spins yarn, knits and finishes a wide range of circular
knit fabrics for use in the manufacture of knit apparel, and also
provides yarn to the Company's apparel segment.
Stevcoknit products are marketed to numerous apparel
manufacturers through marketing staffs employed by Stevcoknit
Marketing Company in New York City and Los Angeles, with sales
personnel also located in North Carolina, Dallas and San
Francisco. To further promote sales of Stevcoknit's fabrics to
apparel manufacturers, the marketing staff of Stevcoknit
Marketing Company also contacts major retailers of products
manufactured from the division's knitted fabrics. Discussions
with these retailers provide information relating to fabric
quality and trends in style and color. In addition to its sales
to apparel manufacturers, the division also sells prepared for
print fabrics to converters through a broker. Certain knitting
operations are scheduled according to projected sales, but most
knitting and finishing of the fabrics are performed to specific
customer orders.
The operations within the knitted fabrics operation are
largely integrated. Various plants are equipped to perform all
stages of the manufacturing process, from carding the raw fiber
stock, to dyeing and finishing the final fabric product. The
fabrics produced by this segment are manufactured by using
Item 1 (Continued)
100% cotton, polyester/cotton blends and 100% polyester. The
Company believes that its knit textile facilities will run at or
near full capacity during fiscal 1995.
Apparel Segment
The apparel segment produces and markets both woven apparel
and knit apparel. The segment's products include the "Duck Head"
line of men's and boys' casualwear, which includes pants,
shorts and shirts. The knit apparel business includes T-shirts
and sweatshirts which are sold under the labels of "Duck Head",
"Delta Apparel", and various private labels.
"Duck Head" Division. The division produces a line of men's
and boys' casual apparel, sold under the "Duck Head" label,
including pants, shorts, shirts, skirts and accessories. This
division also sells a relatively small amount of men's and boys'
woven workwear, sportswear and casualwear under the private
labels of its customers. In fiscal 1994 the division began
licensing various other categories of apparel and accessories.
7
"Duck Head" labeled products are primarily marketed by sales
staff employed by Duck Head Marketing Company to regional and
national retailers with stores in the South and South Atlantic
regions. The "Duck Head" trademark has been associated with
apparel for many decades, but has traditionally been marketed
primarily to a Southeastern customer base. The Company acquired
the brand in February 1989.
The division sells its "Duck Head" products primarily to
regional and national department store chains as well as
specialty apparel retailers and through Company-operated outlet
stores. The division currently displays "Duck Head" products in
"Duck Head" specialty departments within some department stores.
The "specialty department" display format permits the
presentation of an entire line of clothing in a dedicated section
of a store's clothing department, and has been increasingly used
in department stores by the major national clothing brands. The
Company believes that these specialty
department displays will continue to increase recognition of the
"Duck Head" name and logo and expand consumer acceptance of the
line. Gross sales of "Duck Head" labeled products were
approximately $130.4 million in fiscal 1992, $137.3 million in
fiscal 1993, and $95.4 million in fiscal 1994.
"Duck Head" Apparel operates a total of 9 facilities located
in Georgia, Tennessee and Costa Rica. The division purchases the
fabrics used in its products from a number of producers. "Duck
Head" is now acquiring less than one-half of its finished
products from other companies throughout the world. This outside
production takes the form of sewing fabric parts cut at "Duck
Head" facilities, cutting and sewing with fabric and patterns
supplied by "Duck Head", or providing finished garments made to
"Duck Head" specifications. The division maintains a staff of
quality specialists who consistently monitor work in process at
outside companies. The Company believes that there is ample
capacity among outside contractors worldwide to meet its future
production requirements. The majority of the products is
warehoused in the division's leased facilities.
"Duck Head" labeled apparel items are generally required to
be inventoried to permit quick shipment and to level production
schedules, and customer private label apparel items are generally
made only to order. The division's products are manufactured
primarily from 100% cotton. The division's marketing office is
based in Winder, Georgia with regional sales managers and sales
personnel located throughout the country.
"Delta Apparel". "Delta Apparel", which is headquartered in
Duluth, Georgia, operates a total of 9 facilities and produces
knitted T-shirts and sweatshirts. The division markets its
products primarily to companies that screen print shirts for
resale, and to department stores and other clothing stores for
resale under the customer's private labels or under the Company's
"Delta Apparel" label.
8
The division's knit apparel marketing is performed by sales
personnel of Delta Apparel Marketing Company with sales personnel
located throughout the country. Sales personnel call directly on
the retail trade, contacting department stores and the mass
markets such as discount houses. This operation utilizes
independent sales representatives to sell to screen printing
companies. Some knit apparel items are required to be
inventoried to permit quick shipment and to level production
schedules. Special fashion knit apparel items and customer
private label knit apparel styles generally are made only to
order.
Of the yarn used by the Company's knit apparel operation,
approximately one-third is produced by Stevcoknit with the
remainder purchased from outside vendors; the knit apparel
operation is otherwise largely vertically integrated. The
business manufactures its own knitted fabrics, utilizing
Item 1 (Continued)
knitting, dyeing and finishing processes, and cuts and sews its
finished knitted fabrics into apparel. The fabrics used by the
division are either polyester/cotton blends or 100% cotton.
Retail Apparel. The Company has 36 outlet stores in 13
states that sell principally closeout and irregular "Duck Head"
products. These stores also sell a small amount of apparel items
manufactured by other companies.
Fitness Equipment
"Nautilus" Fitness Equipment. Nautilus produces weight
resistance and aerobic equipment for the institutional, medical
and home markets. The current product line in the weight
resistance category is called the "Next Generation", which
consists of 40 individual machines that exercise the various
muscle groups. Nautilus also produces an exclusive line of 25
weight resistance machines for women called "Nautilus for Women".
As a supplement to the weight resistance line, Nautilus produces
five versions of a multi-station machine that serves those
markets that have space and budget limitations. Nautilus
currently produces, for the institutional market, five aerobic
machines, two recumbent bikes, two stairclimbers and a treadmill.
Nautilus historically has been focused on the institutional
market. During the last six months Nautilus has launched a
concerted effort to penetrate the home and medical market.
Nautilus historically targets health clubs, the public sector,
YMCAs and similar institutions and the medical, amenity and
corporate markets. In fiscal 1995, Nautilus plans to enter the
consumer market in the strength and aerobic areas, as well as
expand its efforts in the medical markets to the areas of
diagnosis (exercise components with the ability to measure the
9
strength of a particular muscle and muscle group) and
rehabilitation.
The manufacturing operations at Nautilus are vertically
integrated, including metal fabrication, upholstery, and a vacuum
formed and injection molded plastics process. Raw material is
inventoried, but finished machines are generally manufactured
against customer orders. All manufacturing is done in
Independence, Virginia. The Company believes that the
manufacturing operation is currently operating at approximately
75% of present capacity.
Competition
The cyclical nature of the textile and apparel industries,
characterized by rapid shifts in fashion, consumer demand and
competitive pressures, results in both price and demand
volatility. The demand for any particular product varies from
time to time based largely upon changes in consumer preferences
and general economic conditions affecting the textile and apparel
industries, such as consumer expenditures for nondurables. The
textile and apparel industries are also cyclical because the
supply of particular products changes as competitors enter or
leave the market. The cyclical nature of the various businesses
in which the Company operates was a contributing factor to the
business downturn experienced by the Company in fiscal 1994 and
1993 and the varying manner in which each division's results in
one fiscal year differs from its results in another fiscal year.
See "Management's Discussion and Analysis of Results of
Operations and Financial Condition."
The Company sells primarily to domestic customers and
competes with numerous competitors, both domestic and foreign.
The principal competitive factors are price, service, delivery
time, quality and flexibility, with the significance of each
factor depending upon the product involved. The Company's
competitive position varies among the different goods produced.
There are several major domestic competitors in the finished
cotton and cotton/polyester blend woven fabrics area, none of
which dominates the market. The Company believes that it has a
strong competitive position with respect to the manufacture of
spun synthetic slack-weight and skirt-weight woven fabrics, as
well as wrinkle-resistant all cotton sportswear fabrics.
The woven fabrics' Woodside operation is a major supplier of
both polyester/rayon print cloth used in home furnishings and
women's blouses and acetate fabric used in apparel linings and
surgical tapes. There are several major domestic competitors in
the Company's acetate linings business and its
unfinished cotton and cotton/polyester blend print cloth
business, but no company dominates any of these businesses.
The knitted fabrics business in which Stevcoknit competes is
highly competitive with several large competitors. However, the
10
significant vertical integration of Stevcoknit's manufacturing
operations
Item 1 (Continued)
and its experience in performing the more complicated
manufacturing techniques required in the production of 100%
cotton fabrics provide the Company with certain competitive
advantages. The industry, nevertheless, remains highly
competitive.
The apparel segment competes with numerous domestic and
foreign manufacturers of branded and private label apparel.
Foreign competition has been an increasingly significant factor
in the apparel manufacturing industry, particularly with respect
to items that require labor-intensive production, such as shirts
and jackets, and high cost luxury items. Although domestic
apparel companies must compete to some extent on a price basis
with foreign competition, the Company's management believes that
domestic apparel companies can best compete by selling branded
products, by manufacturing off-shore, by offering product
flexibility, by responding quickly to changes in consumer demand
and by providing more timely deliveries. The latter
characteristics permit retailers to reduce their inventory costs
and lower the risk that product availability will not match
consumer demand. The Company's operations are oriented toward
providing its apparel segment and the customers of its textile
segment with all or some of these competitive advantages. The
Company believes that it and its domestic customers can address
quality control problems more easily than can manufacturers and
distributors of foreign products. Furthermore, the customers of
foreign suppliers generally face letter of credit fees, and
occasionally face delivery delays and claims resolution
difficulties.
Nautilus competes in the institutional fitness market which
is fragmented and highly competitive. Nautilus competes with
several national and local companies. The fitness equipment
industry generally competes for business on price, quality,
specifications and service. Management of the Company believes
that Nautilus has a strong competitive position because of its
high name recognition in markets and its reputation for high
quality, durable equipment.
The Company believes that several aspects of its operations
may mitigate some of the problems posed by competition within the
domestic textile and apparel industries. The variety of the
Company's products offers some degree of protection against the
cyclical nature of the business of individual products.
Management of the Company believes that the percentage of its
production cost attributable to labor is comparable to that of
its competitors. Other competitive strengths include: the
ability to produce special fabrics such as textured blends; the
11
modern equipment in several of its plants; and the Company's
achievement of substantial vertical integration in its various
divisions.
Employees
The Company has approximately 8,100 employees. The
Company's employees are not represented by unions. The Company
believes that its relations with its employees are good.
Environmental and Regulatory Matters
Delta Woodside is subject to federal, state and local
environmental laws and regulations concerning, among other
things, wastewater discharges, storm water flows, air emissions,
ozone depletion and solid waste disposal. Delta Woodside's
plants generate very small quantities of hazardous waste which
are either recycled or disposed of off-site. Most of its plants
are required to possess one or more discharge permits.
The subsidiary which conducts the finished woven fabrics
operations is subject to a Consent Order with the South Carolina
Department of Health and Environmental Control dated September
26, 1985, which was executed prior to Delta Woodside's
acquisition of the business. Pursuant to the Consent Order,
which arose from a determination that several private drinking
wells in the area of two of the subsidiary's plants had been
contaminated, the subsidiary has discontinued the operation near
these plants of a large spray field into which waste water sludge
had been disposed and has placed into operation for such purpose
a new and larger spray field. Delta Woodside expects that any
continuing expenditures to comply with the Consent Order will be
immaterial in amount.
Some of the Company's plants have been unable to comply with
the acute toxicity limits contained in the National Pollutant
Discharge Elimination System (NPDES) permits held by the Company.
With respect to certain such plants in North Carolina, the
Company has signed a Special Order by Consent with the North
Carolina Department of Environmental Health and Natural Resources
(DEHNR) which will require the plants to achieve compliance with
the acute toxicity limits by July 1995. By a March 1992 letter,
the Natural Resources Defense Council notified the Company of its
intent to institute a "citizens' suit" under the Clean Water Act
for certain alleged NPDES violations in North Carolina. No such
suit has been initiated to date. By reason of the Special Order,
the Company
Item 1 (Continued)
believes that any such suit, and compliance with the Special
Order, would not have a material adverse impact on the Company.
With respect to certain South Carolina plants, the Company is
working with
12
the appropriate state agency in developing a corrective action
plan for addressing the toxicity issue. The Company is examining
several courses of action to achieve compliance with its NPDES
permits and does not believe that the matter will have a material
adverse impact on the Company.
Generally, the environmental rules applicable to the Company
are becoming increasingly stringent. The Company incurs capital
and other expenditures in each year that are aimed at achieving
compliance with current and future environmental standards. The
Company does not expect that the amount of such expenditures will
have a material adverse effect on its operations or financial
condition. There can be no assurance, however, that changes in
federal, state or local regulations, changes in regulatory policy
or the discovery of currently unknown problems or conditions will
not require substantial additional expenditures. Similarly, the
extent of Delta Woodside's liability, if any, for past failures
to comply with laws, regulations and permits applicable to its
operations cannot be determined.
Information contained under the subheading "Environmental
Matters" in Management's Discussion and Analysis of Results of
Operations and Financial Condition--Liquidity and Sources of
Capital incorporated into Item 7 of this Form 10-K is
incorporated herein by reference.
Industry Segment Information
Segment information in Note G of the Company's consolidated
financial statements for the fiscal year ended July 2, 1994 is
incorporated herein by reference.
Other
Information concerning order backlogs in Management's
Discussion and Analysis of Results of Operations and Financial
Condition - "Results of Operations, Consolidated Company Results,
Fiscal 1994 versus Fiscal 1993" incorporated into Item 7 of this
Form 10-K is incorporated herein by reference.
13
Item 2. PROPERTIES
The following table provides a description of Delta Woodside's
production and warehouse facilities.
Approximate
Square Approximate
Location Utilization Footage Acreage
Textile Segment
Beattie Plant, Fountain Inn, SC (9) spin/weave 390,000 112
Furman Plant, Fountain Inn, SC (9) weave 116,000 21
Haynsworth Plant, Anderson, SC (9) weave 155,000 16
Distribution Center, Greenville, SC (9) warehouse 88,000 12
Estes Plant, Piedmont, SC (9) spin/weave 332,000 114
Greer Plant, Greer SC (9) weave 255,000 10
Delta 3 Plant, Wallace, SC (9) dye/finish 555,000 527
Cypress Plant, Pamplico, SC (9) spin 144,000 4
Pamplico Plant, Pamplico, SC (9) spin/weave 275,000 520
Delta 2 Plant, Wallace, SC (9) dye/finish 347,000 295
Catawba Plant, Maiden, NC spin 115,000 34
Fayetteville Plant, Fayetteville, NC (7) unused 238,000 15
Carter Plant, Wallace, NC dye/finish 485,000 72
Greensboro Plant, Greensboro, NC knit 195,000 10
Holly Plant, Wallace, NC knit/finish 224,000 3
Edgefield Plant, Edgefield, SC (4) unused 129,000 21
Rainsford Plant, Edgefield, SC spin 296,000 43
Mickel Plant, Spartanburg, SC spin 207,000 14
Apparel Segment
Maiden Plant, Maiden NC knit/dye
finish/cut 305,000 45
Washington Plant, Washington, GA sew 129,800 6
Sandersville Plant, Sandersville, GA sew 27,000 5
Knoxville Plant, Knoxville, TN (2) distribution 550,000 21
Decatur Plant, Decatur, TN (2) sew 75,000 11
Tellico Plains Plant, Tellico
Plains, TN (8) sew 100,000 17
Sparta Plant, Sparta, GA (1) sew 21,000 2
Baldwin Plant, Baldwin, GA (8) press/
distribution 148,000 24
Monroe #3, Monroe, GA cut 52,000 7
Monroe #2, Monroe, GA sew/
distribution 93,000 8
Winder Plant, Winder, GA (3)(8) warehouse/
retail 119,000 3
Jellico Plant, Jellico, TN sew 56,000 5
Harmony Plant, San Jose, Costa Rica sew 14,000
San Jose Plant, San Jose, Costa Rica (1) sew 60,000
6
Jupiter Plant, San Jose, Costa Rica sew 25,000
Ashburn Plant, Ashburn, GA (1) sew 43,000 7
Winder, GA warehouse 10,000
Various (5) warehouse
Various (6) stores
Fitness Equipment Division
Independence, VA manufacturing 254,000 54
Independence, VA (1) manufacturing 30,000
14
Galax, VA (1) manufacturing 40,000
Item 2 (Continued
_____________
(1) Leased facility.
(2) "Duck Head" Outlet Stores lease a portion of the facility for
retail sales.
(3) Approximately 40,000 square feet are currently not used.
(4) The knitted fabrics operation closed this facility during fiscal
1992.
(5) The apparel segment leases certain additional warehouse space from
time to time.
Approximately 226,000 square feet is leased currently with leases
expiring through November 1994.
(6) The "Duck Head" Outlet Stores Operation leases 36 facilities in 13
states, which leased space is Approximately 130,000 square feet.
These leases expire at various dates through 1998.
(7) The knitted fabrics operation closed this facility during fiscal
1993.
(8) These locations will be closed in fiscal 1995.
(9) Title to these facilities are held by the county under a fee-in-
lieu arrangement.
Except as noted above all of the above production and warehouse
facilities are owned by Delta Woodside and its subsidiaries, subject in
certain cases to various outstanding mortgages and security interests.
The apparel segment's Sparta plant, Sparta, Georgia and San Jose plant
in San Jose, Costa Rica are leased on a month-to-month basis, and the
Ashburn Plant in Ashburn, Georgia has a lease which expires `in February
1999. The lease of the Tellico Plains Plant has expired and the Company
is in the process of acquiring the facility for a nominal price. The
fitness division leases manufacturing capacity in Independence, Virginia
which lease expires in July 1998.
Delta Woodside leases corporate and division administrative offices
in Greenville, South Carolina. The lease on the corporate offices
expires December 1997 and leases on the administrative offices expire in
2008. Sales offices are leased in Charlotte, New York, Chicago,
Raleigh, Newport Beach, San Francisco and Los Angeles with leases
expiring through February 1998.
At the date of execution of this Form 10-K, the Company believes
that its finished woven all cotton plants and its knit textile plants
are operating virtually at full production capacity while its finished
woven synthetic and unfinished woven fabrics operations are operating at
slightly less than full production capacity. Various factors affect the
relative use by the Company's apparel segment of its own facilities and
outside contractors in the various apparel production phases. This
segment is currently using all its internal productive capacity. The
fitness equipment operation is operating at approximately 75% of its
production capacity as a result of new building space in excess of
current volume.
16
Item 3. LEGAL PROCEEDINGS
In its Form 8-K, dated January 11, 1994, and Forms 10-Q for
the fiscal quarters ended January 1, 1994 and April 2, 1994, the
Company has previously reported the award on November 24, 1993 by
a jury in the Circuit Court of Montgomery County, Alabama (the
"Circuit Court"), of $29,056,000 to a former Duck Head
independent sales representative (Ken Hoots) and two of his
salesmen (Terry Long and Bill Pace) against a subsidiary of the
Company in a suit captioned "Ken Hoots, Terry Long and Bill Pace
v. Duck Head Apparel Company Inc. et. al. (the "Hoots Suit").
The Hoots Suit commenced on March 17, 1993.
After a hearing, the Circuit Court judge reduced the verdict
to $22,852,000 and entered
judgment against the Company's subsidiary on March 28, 1994 as
follows:
(a) $852,000 to the plaintiffs on their claim of breach of
contract respecting alleged unpaid commissions,
(b) $4,000,000 to Ken Hoots, $2,000,000 to Terry Long, and
$1,000,000 to Bill Pace for mental anguish on their
claim for fraud, and
(c) $15,000,000 to the plaintiffs as punitive damages on
their claim of fraud.
The Company believes that the verdict is fundamentally
unjust and intends vigorously to seek its reversal on appeal. On
April 9, 1994, the Company's subsidiary filed a notice of appeal
of judgment with the Alabama Supreme Court.
In order to prevent execution of the judgment during the
appellate process, the Company has guaranteed payment of the
final adjudicated award and posted bond in the amount of
$28,565,000.
The Company is seeking recovery of a portion of the award
under certain of its insurance policies. At this time, however,
there is no assurance that any portion of the award will be
recovered by the Company through insurance.
Alabama law permits the plaintiffs to recover interest at
the rate of 12% per annum on the amount of the final adjudicated
award from the date the original judgment was entered (November
24, 1993) until the date that any final adjudicated award is paid
to the plaintiffs.
The Company made a charge to income during fiscal 1994 to
establish reserves which it feels are sufficient in order to
cover payment of any final adjudicated award.
A lawsuit with allegations similar to those in the Hoots
Suit is pending against a subsidiary of the Company in the United
States District Court for Western District of Kentucky brought by
an individual (Donnie Cecil) who previously served as an
17
independent sales representative for the Duck Head division. The
suit was filed on October 1, 1993. The amount of damages claimed
in the suit has not yet been determined, and the ultimate impact
of the suit on the Company is as yet unknown.
In addition to those actions noted above, from time to time
the Company and its subsidiaries are defendants in legal actions
arising if the normal course of its business, including product
liability claims. The Company believes that, as a result of its
legal defenses, insurance arrangements and indemnification
provisions with parties believed by the Company to be financially
capable, none of these actions, if decided adversely, should have
a material adverse effect on its results of operations or
financial condition taken as a whole.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS
No matter was submitted to a vote of security holders during
the fourth quarter of the Company's 1994 fiscal year.
18
PART II
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND
RELATED STOCKHOLDER MATTERS
The material under the heading "Common Stock Market Prices
and Dividends" on the inside front cover of the Company's annual
shareholders' report for the year ended July 2, 1994 is
incorporated herein by reference.
Item 6. SELECTED FINANCIAL DATA
The material under the heading "Selected Financial Data" on
page 1 of the Company's annual shareholders' report for the year
ended July 2, 1994 is incorporated herein by reference.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The material under the heading "Management's Discussion and
Analysis of Results of Operations and Financial Condition" on
pages 4 through 11 (exclusive of graphs) of the Company's annual
shareholders' report for the year ended July 2, 1994 is
incorporated herein by reference.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The consolidated financial statements included on pages 15
through 28 of the Company's annual shareholders' report for the
year ended July 2, 1994 are incorporated herein by reference.
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
The Company filed a Form 8-K on August 25, 1994 reporting a
change in accountants.
19
PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information required by this Item is incorporated herein
by reference from the portions of the definitive Proxy Statement
to be filed with the Securities and Exchange Commission on or
prior to 120 days following the end of the Company's fiscal year
under the headings "Election of Directors", "Executive Officers",
and "Stock Ownership of Principal Shareholders and Management".
Item 11. EXECUTIVE COMPENSATION
The information required by this Item is incorporated herein
by reference from the portions of the definitive Proxy Statement
to be filed with the Securities and Exchange Commission on or
prior to 120 days following the end of the Company's fiscal year
under the headings "Management Compensation" and "Compensation
Committee Interlocks and Insider Participation".
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The information required by this Item is incorporated herein
by reference from the portion of the definitive Proxy Statement
to be filed with the Securities and Exchange Commission on or
prior to 120 days following the end of the Company's fiscal year
under the heading "Stock Ownership of Principal Shareholders and
Management".
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required by this Item is incorporated herein
by reference from the portion of the definitive Proxy Statement
to be filed with the Securities and Exchange Commission on or
20
prior to 120 days following the end of the Company's fiscal year
under the heading "Related Party Transactions".
21
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
FORM 8-K
(a) (1) and (2) Financial Statements and Financial
Statement Schedules
The response to this portion of Item 14 is set forth on page F-2
included herein, which response is incorporated herein by
reference.
(3) Listing of Exhibits:*
3.1 Articles of Incorporation of the Company, as
amended through February 5, 1989: Incorporated by
reference to Exhibit 3.1 to the Registration
Statement on Form S-4 of RSI Corporation and
Porter Brothers, Inc., File No. 33-30247 (the
"Form S-4").
3.1.1 Articles of Amendment to Articles of
Incorporation of the Company: Incorporated by
reference to Exhibit 3.1.2 to the Form S-4.
3.1.2 Articles of Merger of Harper Brothers, Inc.
into RSI Corporation: Incorporated by reference
to Exhibit 4.1.1 to the Registration Statement of
the Company on Form S-8, File No. 33-33116 (the
"1990 Form S-8").
3.1.3 Articles of Merger of Delta Woodside
Industries, Inc., a Delaware corporation, into RSI
Corporation: Incorporated by reference to Exhibit
4.1.2 to the 1990 Form S-8.
3.1.4 Articles of Merger of Duncan Office Supplies,
Inc., into Delta Woodside Industries, Inc:
Incorporated by reference to Exhibit 3.1 to the
Company's Form 10-Q for the quarterly period ended
December 29, 1990 (the "December 1990 10-Q").
3.1.5 Articles of Amendment to the Articles of
Incorporation of Delta Woodside Industries, Inc.,
filed with the South Carolina Secretary of State
on November 15, 1991: Incorporated by reference
to Exhibit 4.6 to the Form 10-Q of the Company for
the quarterly period ended December 28, 1991.
3.2 By-laws of the Company, as amended: Incorporated
by reference to Exhibit 3.1.1 to the Form S-4.
3.2.1 Amendments to By-laws of the Company:
Incorporated by reference to Exhibit 3.2 to the
December 1990 10-Q.
22
3.2.2 Amendment to By-laws of the Company, adopted
as of June 29, 1992: Incorporated by reference to
Exhibit 3.2.2 to the Company's Form 10-K for the
fiscal year ended June 27, 1992 (the "1992 10-K").
4.1 See Exhibits 3.1, 3.1.1, 3.1.2, 3.1.3, 3.1.4,
3.1.5, 3.2, 3.2.1. and 3.2.2.
4.1.1 Specimen of Certificate for the Company's
Common Stock: Incorporated by reference to
Exhibit 4.7 to the Company's Registration
Statement on Form S-3, File No. 33-42710 (the
"Form S-3").
Item 14 (Continued)
4.2.1 Credit Agreement dated as of June 24, 1992
among Delta Woodside Industries,
Inc., the Lenders named therein, and The First
National Bank of Boston, as Agent (with exhibits
and schedules omitted) together with forms of
Promissory
Note, Subsidiary Guaranty, Contribution Agreement
and certain other documents: Incorporated by
reference to Exhibit 4.2.1 to the 1992 10-K. The
Company agrees to furnish supplementally to the
Securities and Exchange Commission a copy of any
omitted schedule, exhibit or annex to the Credit
Agreement or any of its amendments upon request of
the Commission. This Credit Agreement, as
amended, terminated as of September 7, 1994.
4.2.2 Amendment No. 1 dated as of September 1993 to
Credit Agreement dated as of June 24, 1992:
Incorporated by reference to Exhibit 4.2.2 to the
Form 10-K of the Company for the fiscal year ended
July 3, 1993.
4.2.3 Waiver and Amendment No. 2 to Credit
Agreement (excluding Annex 1 and Annex 2):
Incorporated by reference to Exhibit 4.2.4 to the
Form 10-Q of the Company for the quarterly period
ended January 1, 1994.
4.2.4 Waiver and Amendment No. 3 to Credit
Agreement: Incorporated by reference to Exhibit
4.2.4 to the Form 10-Q of the Company for the
quarterly period ended April 2, 1994.
4.3 Credit Agreement dated as of September 7, 1994
among Delta Woodside Industries, Inc., the Lenders
named therein, and NationsBank of North Carolina,
N.A., as Agent (with exhibits and schedules
omitted) together with forms of Promissory Note,
23
Subsidiary Guaranty and certain other documents.
The Company agrees to furnish supplementally to
the Securities and Exchange Commission a copy of
any omitted schedule or exhibit to the Credit
Agreement upon request of the Commission.
4.4 The Company hereby agrees to furnish to the
Commission upon request of the Commission a copy
of any instrument with respect to long-term debt
not being registered in a principal amount less
than 10% of the total assets of the Company and
its subsidiaries on a consolidated basis.
10.1 Lease, dated December 27, 1987 by and between
Hammond Square, Ltd. and the Company:
Incorporated by reference to Exhibit 10.10 to
Registration Statement No. 33-22563 on Form S-4 of
Delta Woodside Industries, Inc., a Delaware
corporation ("Registration Statement No. 33-
22563").
10.2** Delta Woodside Deferred Compensation Plan for
Key Employees: Incorporated by reference to
Exhibit 10.6 to the Form 10-Q of the Company for
the quarterly period ended December 30, 1989.
10.3** Incentive Stock Award Plan effective July 1,
1990: Incorporated by reference to Exhibit 10.1
to the Form 10-Q of the Company for the fiscal
quarter ended March 31, 1990.
10.4.1** Stock Option Plan effective as of July 1,
1990: Incorporated by reference to Exhibit 10.11
to the Company's Form 10-K for the fiscal year
ended June 30, 1990.
10.4.2** Amendment No. 1 to Stock Option Plan:
Incorporated by reference to Exhibit 10.1 to the
December 1990 10-Q.
Item 14 (Continued)
10.4.3** Amendment to Stock Option Plan: Incorporated
by reference to Exhibit 10.9.2 to the Company's
Form 10-K for the fiscal year ended June 29, 1991
(the "1991 10-K").
10.5 Stock Transfer Restrictions and Right of First
Refusal Agreement between the Company and E. Erwin
Maddrey, II: Incorporated by reference to Exhibit
10.2 to the December 1990 10-Q.
10.6 Stock Transfer Restrictions and Right of First
Refusal Agreement between the Company and Bettis
C. Rainsford: Incorporated by reference to
Exhibit 10.3 to the December 1990 10-Q.
24
10.7** Summary of Delta Woodside Industries, Inc.,
Director Charitable Giving Program: Incorporated
by reference to Exhibit 10.11 to the 1992 10-K.
10.8.1** Directors Stock Acquisition Plan: Incorporated by
reference to Exhibit 10.14 to the 1991 10-K.
10.8.2** Amendment of Director Stock Acquisition Plan,
dated April 30, 1992: Incorporated by reference
to Exhibit 10.12.2 to the 1992 10-K.
10.9 See Exhibits 4.2.1, 4.2.2, 4.2.3,4.2.4 and 4.3.
13 Annual Report to Shareholders of the Company for
the fiscal year ended July 2, 1994.
22 Subsidiaries of the Company.
23 Consent of independent auditors.
27 Financial Data Schedule
* All reports previously filed by the Company with
the Commission pursuant to the Exchange Act, and
the rules and regulations promulgated thereunder,
exhibits of which are incorporated to this Report
by reference thereto, were filed under Commission
File Number 1-10095.
** This is a management contract or compensatory plan
or arrangement.
(b) Reports on Form 8-K
The Company did not file any report on Form 8-K during
the fourth quarter of the fiscal year ended July 2,
1994.
(c) Exhibits
The response to this portion of Item 14 is submitted as
a separate section of this report.
(d) Financial Statement Schedules
The response to this portion of Item 14 is submitted as
a separate section of this report.
25
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
DELTA WOODSIDE INDUSTRIES,INC.
8/30/94 /s/ E. Erwin Maddrey,II
Date E. Erwin Maddrey,II
President and Chief
Executive Officer
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated.
/s/ C. C. Guy 9/7/94 /s/ E. Erwin Maddrey, II 8/30/94
C. C. Guy Date E.Erwin Maddrey, II Date
Director President and
Chief Executive Officer
/s/ James F. Kane 9/12/94 /s/ Bettis C.Rainsford 9/26/94
James F. Kane Date Bettis C. Rainsford Date
Director Executive Vice President,
Chief Financial Officer and
Treasurer
/s/ Max Lennon 9/16/94 /s/ Douglas J.Stevens 8/29/94
Max Lennon Date Douglas J. Stevens Date
Director Controller and Assistant
Secretary
/s/ Buck A. Mickel 9/20/94
Buck A. Mickel Date
Director
/s/ Buck Mickel 9/20/94
Buck Mickel Date
Director
27
ANNUAL REPORT ON FORM 10-K
ITEM 14(a) (1) and (2), (c) and (d)
LIST OF FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
CERTAIN EXHIBITS
FINANCIAL STATEMENT SCHEDULES
YEAR ENDED JULY 2, 1994
DELTA WOODSIDE INDUSTRIES, INC.
GREENVILLE, SOUTH CAROLINA
F-1
FORM 10-K--ITEM 14(a)(1) AND (2)
DELTA WOODSIDE INDUSTRIES, INC.
LIST OF FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
The following consolidated financial statements of Delta Woodside
Industries, Inc. and subsidiaries included in the Annual Report
of the Registrant to its shareholders for the Year ended July 2,
1994 are incorporated by reference in Item 8:
Consolidated balance sheets--July 2, 1994 and July 3, 1993.
Consolidated statements of operations--Years ended July 2,
1994, July 3, 1993, and June 27, 1992.
Consolidated statements of shareholders' equity--Years ended
July 2, 1994, July 3, 1993 and June 27, 1992.
Consolidated statements of cash flows--Years ended July 2,
1994, July 3, 1993 and June 27, 1992.
Notes to consolidated financial statements--July 2,1994.
The following consolidated financial statement schedules of Delta
Woodside Industries, Inc. are included in Item 14(d):
Schedule V - Property, plant and equipment
Schedule VI - Accumulated depreciation, depletion and
amortization of property, plant and equipment
Schedule VIII - Valuation and qualifying accounts
Schedule IX - Short-term borrowings
Schedule X - Supplementary income statement information
All other schedules for which provision is made in the applicable
accounting regulation of the Securities and Exchange Commission
are not required under the related instructions or are
inapplicable, and therefore have been omitted. Columns omitted
from schedules filed have been omitted because the information is
not applicable.
F-2
SCHEDULE V--PROPERTY, PLANT AND EQUIPMENT
DELTA WOODSIDE INDUSTRIES, INC.
COL. A COL. B COL. C COL. D COL. E COL.F
Balance at Other
CLASSIFICATION Beginning of Additions at Changes-Add Balance at end
of Period Cost Retirements (Deduct) Describe of Period
Year Ended July 2, 1994:
Land and land improvements $ 5,149,000 $ 213,000 $ (44,000) $ 5,318,000
Buildings 59,782,000 5,274,000(1)(7) (559,000) 64,497,000
Machinery and equipment 171,900,000 22,088,000(1) (2,721,000) 191,267,000
Furniture and fixtures 5,984,000 1,237,000 (278,000) 6,943,000
Leasehold improvements 2,903,000 167,000 (553,000) 2,517,000
Construction in progress 8,397,000 877,000(4) (3,000) 9,271,000
Totals $254,115,000 $ 29,856,000 $(4,158,000)(6) $279,813,000
Year Ended July 3, 1993:
Land and land improvements $ 3,763,000 $ 1,419,000 $ ( 33,000) $ 5,149,000
Buildings 47,189,000 14,033,000(2) (1,440,000) 59,782,000
Machinery and equipment 127,214,000 48,201,000(2) (3,515,000) 171,900,000
Furniture and fixtures 3,572,000 2,692,000 (280,000) 5,984,000
Leasehold improvements 1,824,000 1,079,000 2,903,000
Construction in progress 20,078,000 (11,681,000)(2)(4) 8,397,000
Totals $203,640,000 $ 55,743,000(5) $(5,268,000) $254,115,000
SCHEDULE V--PROPERTY, PLANT AND EQUIPMENT
DELTA WOODSIDE INDUSTRIES, INC.
COL. A COL. B COL. C COL. D COL. E COL.F
Balance at Other
CLASSIFICATION Beginning of Additions at Changes-Add Balance at end
of Period Cost Retirements (Deduct) Describe of Period
Year Ended June 27, 1992:
Land and land improvements $ 3,825,000 $ 38,000 $ (100,000) $ 3,763,000
Buildings 41,796,000 5,602,000(3) (209,000) 47,189,000
Machinery & equipment 105,664,000 24,495,000(3) (2,945,000) 127,214,000
Furniture and fixtures 3,047,000 565,000 (40,000) 3,572,000
Leasehold improvements 1,700,000 124,000 1,824,000
Construction in progress 7,986,000 12,092,000(3)(4) 20,078,000
Totals $164,018,000 $42,916,000 $ (3,294,000) $203,640,000
__________
NOTES:
(1) Includes $13,079,000 and $6,626,000 for plant modernization in the knitted fabrics division and
the woven fabrics division, respectively.
(2) Includes $9,026,000 and $31,143,000 for building and machinery and equipment for the open-end
yarn plant in the knitted fabrics operations.
(3) Includes $19,390,000 in loom projects for the woven fabrics operations and $18,323,000 for the
open-end yarn plant in the knitted fabrics operations.
(4) Includes $864,000, $1,694,000, and $6,610,000 of purchases payable for the years ended July 2,
1994, July 3, 1993, and June, 27, 1992 respectively.
(5) Includes assets acquired through a business acquisition of $6,168,000 during the year ended
July 3, 1993.
(6) Includes the sale of the office product division effective June 4, 1994.
SCHEDULE V--PROPERTY, PLANT AND EQUIPMENT
DELTA WOODSIDE INDUSTRIES, INC.
COL. A COL. B COL. C COL. D COL. E COL.F
Balance at Other
CLASSIFICATION Beginning of Additions at Changes-Add Balance at end
of Period Cost Retirements (Deduct) Describe of Period
(7) The annual provisions for depreciation have been computed principally in accordance with the
following range of rates.
Buildings and land improvements 3% to 7%
Machinery and equipment 7% to 33%
Furniture and fixtures 10% to 25%
Leasehold improvements 5% to 20%
SCHEDULE VI--ACCUMULATED DEPRECIATION, DEPLETION AND AMORTIZATION
OF PROPERTY, PLANT AND EQUIPMENT
DELTA WOODSIDE INDUSTRIES, INC.
COL. A COL. B COL. C COL. D COL. E COL. F
Balance at Additions Other
DESCRIPTION Beginning of Charged to Cost Changes-Add Balance at end
of Period and Expenses Retirements (Deduct) Describe of Period
Year Ended July 2, 1994:
Buildings and land improvements $14,019,000 $ 2,898,000 $ (127,000) $1,992,000 $18,782,000
Machinery and equipment 51,206,000 17,178,000 (2,134,000) 66,250,000
Furniture and fixtures 2,649,000 1,091,000 (165,000) 149,000 3,724,000
Leasehold improvements 1,095,000 177,000 (246,000) 1,026,000
Totals $68,969,000 $21,344,000 $(2,672,000) $2,141,000(1) $89,782,000
Year Ended July 3, 1993:
Buildings and land improvements $11,427,000 $ 2,636,000 $ (44,000) $14,019,000
Machinery and equipment 40,250,000 13,211,000 (2,255,000) 51,206,000
Furniture and fixtures 1,770,000 886,000 (7,000) 2,649,000
Leasehold improvements 738,000 357,000 1,095,000
Totals $54,185,000 $17,090,000 $(2,306,000) $68,969,000
SCHEDULE VI--ACCUMULATED DEPRECIATION, DEPLETION AND AMORTIZATION
OF PROPERTY, PLANT AND EQUIPMENT
DELTA WOODSIDE INDUSTRIES, INC.
COL. A COL. B COL. C COL. D COL. E COL. F
Balance at Additions Other
DESCRIPTION Beginning of Charged to Cost Changes-Add Balance at end
of Period and Expenses Retirements (Deduct) Describe of Period
Year Ended June 27, 1992:
Buildings and land improvements $ 9,165,000 $ 2,294,000 $ (32,000) $11,427,000
Machinery and equipment 32,409,000 10,700,000 (2,859,000) 40,250,000
Furniture and fixtures 1,247,000 534,000 (11,000) 1,770,000
Leasehold improvements 555,000 183,000 738,000
Totals $43,376,000 $13,711,000 $(2,902,000) $54,185,000
(1) Writedowns of property, plant and equipment in connection with the restructuring charge.
SCHEDULE VIII--VALUATION AND QUALIFYING ACCOUNTS
DELTA WOODSIDE INDUSTRIES, INC.
COL. A COL. B COL. C COL. D COL. E
ADDITIONS
Balance at
DESCRIPTION Beginning (1) (2) Deductions Balance at End
of Period Charged to Costs Charged to Other -Describe of Period
and Expenses Accounts-Describe
Year Ended July 2, 1994:
Deducted from asset accounts:
Allowance for doubtful
accounts and sales
allowances $5,537,000 $3,886,000 $(1,658,000)(2) $4,490,000(1) $3,275,000
Year Ended July 3, 1993:
Deducted from asset accounts:
Allowance for doubtful
accounts and sales
allowances $5,413,000 $2,025,000 $353,000(2) $2,254,000(1) $5,537,000
SCHEDULE VIII--VALUATION AND QUALIFYING ACCOUNTS
DELTA WOODSIDE INDUSTRIES, INC.
COL. A COL. B COL. C COL. D COL. E
ADDITIONS
Balance at
DESCRIPTION Beginning (1) (2) Deductions Balance at End
of Period Charged to Costs Charged to Other -Describe of Period
and Expenses Accounts-Describe
Year Ended June 27, 1992:
Deducted from asset accounts:
Due from factor $ 95,000 $ (39,000) $ 56,000
Allowance for doubtful
accounts and sales
allowances 2,277,000 3,389,000 $1,774,000 2,027,000(1) $5,413,000
Totals $2,372,000 $3,350,000 $1,774,000(2) $2,083,000 $5,413,000
__________
NOTES:
(1) Uncollectible accounts written off.
(2) Net change in sales allowances charged to income as a reduction of sales.
SCHEDULE IX--SHORT-TERM BORROWINGS
DELTA WOODSIDE INDUSTRIES, INC.
COL. A COL. B COL. C COL. D COL. E COL. F
Weighted Maximum Amount Average Amount Weighted Average
CATEGORY OF AGGREGATE Balance at End Average Outstanding Outstanding Interest Rate
SHORT-TERM BORROWINGS of Period Interest During the During the During the
Rate Period Period(5) Period(4)
Year Ended July 2, 1994:
Notes payable to banks:
Line of credit (1) $ -0- 0% $ 41,364,000 $ 23,162,000 4.1%
Year Ended July 3, 1993:
Notes payable to banks:
Line of credit $ -0- 0% $ 12,087,000 $ 3,568,000 3.8%
Year Ended June 27, 1992:
Notes payable to banks:
Line of Credit
secured (2)(3) $ -0- 0% $114,023,000 $ 47,310,000 7.7%
SCHEDULE IX--SHORT-TERM BORROWINGS
DELTA WOODSIDE INDUSTRIES, INC.
COL. A COL. B COL. C COL. D COL. E COL. F
Weighted Maximum Amount Average Amount Weighted Average
CATEGORY OF AGGREGATE Balance at End Average Outstanding Outstanding Interest Rate
SHORT-TERM BORROWINGS of Period Interest During the During the During the
Rate Period Period(5) Period(4)
NOTES:
(1) The line of credit ($10,347,000) was refinanced with a long-term credit facility on September
7, 1994.
(2) The line of credit was converted to a long-term credit facility on June 24, 1992.
(3) Line of credit secured by assigned receivables of certain subsidiaries of the Company.
(4) The weighted average interest rate during the period was computed by dividing actual
interest expense by average short-term debt outstanding.
(5) The average amount outstanding during the period was computed by averaging the month-end
outstanding principal balances.
SCHEDULE X--SUPPLEMENTARY INCOME STATEMENT INFORMATION
DELTA WOODSIDE INDUSTRIES, INC.
COL. A COL. B
ITEM CHARGED TO COSTS AND EXPENSES
______________Year Ended________________
July 2, July 3, June 27,
1994__ 1993__ 1992__
Maintenance and repairs $24,064,000 $24,341,000 $21,517,000
Advertising $ 7,036,000 $ 7,021,000 $ 2,943,000
_______________
NOTE:
The amounts for amortization of intangible assets, pre-operating costs
and similar deferrals, taxes (other than payroll and income taxes) and
royalties for the years ended July 2, 1994, July 3, 1993 and June 27,
1992 are not presented as such amounts are less than 1% of net sales.
F-12
EXHIBIT INDEX
4.3 Credit Agreement dated as of September 7, 1994
among Delta Woodside Industries, Inc., the Lenders
named therein, and NationsBank of North Carolina,
N.A., as Agent (with exhibits and schedules
omitted) together with forms of Promissory Note,
Subsidiary Guaranty and certain other documents.
The Company agrees to furnish supplementally to
the Securities and Exchange Commission a copy of
any omitted schedule or exhibit to the Credit
Agreement upon request of the Commission.
13 Annual Report to Shareholders of the Company for
the fiscal year ended July 2, 1994.
22 Subsidiaries of the Company.
23 Consent of independent auditors.
27 Financial Data Schedule