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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2000 Commission file number 1-878
BLAIR CORPORATION
Incorporated in Delaware I.R.S. Employer Identification Number:
220 Hickory Street 25-0691670
Warren, Pennsylvania 16366
(814) 723-3600
Securities registered pursuant to Section 12(b) of the Act:
NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
Common Stock, without nominal or par value American Stock Exchange
Securities registered pursuant to Section 12(g) None
of the Act:
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 by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of the 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 nonaffiliates of
the registrant as of February 23, 2001 was $136,734,712. There were 7,968,844
shares of common stock outstanding as of February 23, 2001, which amount
represents the figure reported outstanding by the Company's transfer agent as of
the record date.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Annual Report to Stockholders for the fiscal year ended
December 31, 2000 (the "Annual Report") are incorporated by reference into Part
II and Part IV of this Form 10-K. Portions of the Proxy Statement for the 2001
Annual Meeting of Stockholders (the "Proxy Statement") are incorporated by
reference into Part III of this Form 10-K.
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PART I
ITEM 1. BUSINESS
(a) GENERAL.
Blair Corporation (the "Company") was founded in 1910 by John L. Blair,
Sr., and was incorporated in 1924 under the laws of the State of Delaware. The
Company's business consists of the sale of fashion apparel for men and women,
plus a wide range of home products, primarily through direct mail merchandising.
The Company operates three retail stores, two in Pennsylvania and one in
Delaware, and two outlet stores in Pennsylvania. The Company employs
approximately 2,500 people. None of the Company's employees are subject to
collective bargaining agreements.
(b) INFORMATION REGARDING INDUSTRY SEGMENTS.
The Company's business consists of only one industry segment, which is
the direct mail and retail merchandising of men's and women's fashion apparel
and home products.
(c) DESCRIPTION OF BUSINESS.
The Company markets a wide range of merchandise, manufactured by a
number of independent suppliers, both domestic and foreign. Most of these
suppliers have been associated with the Company for many years and manufacture
products based upon the Company's specifications. Suppliers are selected in
accordance with their ability to produce high quality products in a
cost-effective manner.
The Company markets its products mainly by direct mail. Catalogs and
letters containing color folders, depict the current styles of womenswear (such
as coordinates, dresses, tops, pants, skirts, lingerie, sportswear, suits,
jackets, outerwear and shoes), menswear (such as suits, shirts, outerwear,
active wear, slacks, shoes, and accessories), and home products (such as
bedspread ensembles, draperies, furniture covers, area rugs, bath accessories,
kitchenware, gifts, collectibles and personal care items) and are mailed
directly to existing and prospective customers. Sales of the menswear and
womenswear products, including the new Crossing Pointe product line, accounted
for approximately 86% of the Company's total sales in 2000, and sales of home
products accounted for the remaining 14% (approximately). Media and co-op
prospect advertising programs continue to be used as components of the Company's
customer acquisition strategy. The Company had minimal presence on the Internet
in 2000, approximately $2 million in sales, but will be expanding its Internet
presence in 2001. The Company launched its own e-commerce website
(www.blair.com) in the fall of 2000 and redesigned the site at the beginning of
2001.
Catalog mailings are mailed from commercial printers engaged by the
Company and letter mailings originate from the Company's Mailing Center in
nearby Irvine, Pennsylvania. Orders for merchandise are processed at the
Company's corporate offices in Warren, Pennsylvania (telephone orders via the
call centers) and orders are filled and mailed from the Company's Distribution
Center in Irvine, Pennsylvania. The Company serves customers throughout the
fifty states.
The Company's outlet stores enable it to more efficiently promote and
liquidate discontinued, overstocked and returned merchandise. The Delaware
retail store is the only Company retail facility located outside of its home
state of Pennsylvania.
The Company considers its merchandise to be low/medium-priced and
competes for sales with other direct marketers, retail department stores,
specialty shops, discount store chains and e-commerce and multi-channel
marketers. The Company competes based on its sales expertise - it's unique
combination of product, quality, price, credit, guarantee and service.
During 2000, the Company continued to broaden its customer information
database systems. The marketing and credit departments are continually updated
in order to enhance the Company's ability to market to both customers and
prospects.
(d) FOREIGN OPERATIONS AND EXPORT SALES.
The Company does not derive any revenue from sales of merchandise
outside of the United States.
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ITEM 2. PROPERTIES
The Company owns the following properties:
1. Blair Headquarters (220 Hickory Street, Warren, Pennsylvania).
2. Blair Distribution Center (Route 62, Irvine, Pennsylvania).
3. Blair Mailing Center (Route 62, Irvine, Pennsylvania).
4. Blair Warehouse Outlet (Route 62, Starbrick, Pennsylvania).
5. Blair Warehouse Outlet (Millcreek Mall, Erie, Pennsylvania).
6. Bell Warehouse Building (Liberty Street, Warren, Pennsylvania).
7. Starbrick Warehouse Building (Route 62, Starbrick, Pennsylvania).
The Company leases the following properties:
1. Blair Retail Store (Wilmington, Delaware).
2. Warehouse Building (Route 62, Starbrick, Pennsylvania).
3. Telephone Call Center (Erie, Pennsylvania).
4. Telephone Call Center (Franklin, Pennsylvania).
5. Blair Retail Store (Grove City, Pennsylvania).
In addition, two of the Company's wholly-owned subsidiaries lease
office space in Newark, Delaware, which they use as their principal offices.
Management believes that these properties are capable of meeting the
Company's anticipated needs for the near future once the previously announced
$23 million modernization and expansion of the Company's merchandise fulfillment
capabilities is completed. The Company's marketing strategy and potential sales
growth may require expansion of the Company's customer service and call center
capabilities.
ITEM 3. LEGAL PROCEEDINGS
The Company is not involved in any pending legal proceedings other than
legal proceedings occurring in the ordinary course of business. Management
believes that none of these legal proceedings, individually or in the aggregate,
will have a material adverse impact on the results of operations or financial
condition of the Company.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders, through the
solicitation of proxies or otherwise, during the fourth quarter of the fiscal
year covered by this report.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
The information required by this item is incorporated by reference to
page 12 of the Company's 2000 Annual Report to Stockholders.
ITEM 6. SELECTED FINANCIAL DATA
The information required by this item is incorporated by reference to
page 12 of the Company's 2000 Annual Report to Stockholders.
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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The information required by this item is incorporated by reference to
pages 13 through 16 of the Company's 2000 Annual Report to Stockholders.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information required by this item is incorporated by reference to
pages 6 through 12 of the Company's 2000 Annual Report to Stockholders.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY
Information regarding directors and executive officers of the Company
appearing under the caption "Election of Directors" in the Company's Proxy
Statement for the 2001 Annual Meeting of Stockholders filed with the Securities
and Exchange Commission on March 16, 2001 (the "2001 Proxy Statement") is hereby
incorporated by reference.
ITEM 11. EXECUTIVE COMPENSATION
Information appearing under the caption "Executive Compensation" in the
2001 Proxy Statement is hereby incorporated by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Information setting forth the security ownership of certain beneficial
owners and management appearing under the captions "Security Ownership of
Certain Beneficial Owners" and "Security Ownership of Management" in the 2001
Proxy Statement is hereby incorporated by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Not applicable.
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PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) EXHIBITS AND FINANCIAL STATEMENTS AND SCHEDULES.
(1) Financial Statements. The Company's consolidated financial
statements to be included in Part II, Item 8 are incorporated herein by
reference to the Company's 2000 Annual Report to Stockholders, a copy of which
accompanies this report on Form 10-K.
(2) Financial Statement Schedules. SCHEDULE II -- VALUATION AND
QUALIFYING ACCOUNTS is being filed as part of this report on Form 10-K, and
should be read in conjunction with the consolidated financial statements of the
Company described in Item 14(a)(1) above.
All other schedules set forth in the applicable accounting regulations
of the Securities and Exchange Commission either are not required under the
related instructions or are not applicable and, therefore, have been omitted.
(3) List of Exhibits.
The exhibits filed as a part of this Form 10-K are as follows (filed
herewith unless otherwise noted):
3 (i) Restated Certificate of Incorporation of the Company*
3 (ii) Bylaws of the Company**
4 Form of Specimen Common Stock Certificate of Blair
Corporation***
10.1 Stock Accumulation and Deferred Compensation Plan for
Directors****
10.2 Blair Corporation 2000 Omnibus Stock Plan*****
11 Computation of Earnings per Share (incorporated by reference to
page 6 of the 2000 Annual Report to Stockholders)
13 2000 Annual Report to Stockholders
21 Subsidiaries of Registrant
23 Consents of Experts and Counsel
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* Incorporated herein by reference to Exhibit A to the Company's Quarterly
Report on Form 10-Q filed with the SEC on August 10, 1995 (SEC File No.
1-878).
** Incorporated herein by reference to Exhibit 4.3 to the Company's
Registration Statement on Form S-8 filed with the SEC on July 19, 2000
(SEC File No. 333-41772).
*** Incorporated herein by reference to Exhibit 4.1 to the Company's
Registration Statement on Form S-8 filed with the SEC on July 19, 2000
(SEC File No. 333-41772).
**** Incorporated herein by reference to Exhibit A to the Company's Proxy
Statement filed with the SEC on March 20, 1998 (SEC File No. 1-878).
***** Incorporated herein by reference to Exhibit A to the Company's Proxy
Statement filed with the SEC on March 17, 2000 (SEC File No. 1-878).
(b) REPORTS ON FORM 8-K.
The registrant has filed no Forms 8-K during the quarter ended December
31, 2000.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
BLAIR CORPORATION
(Registrant)
Date: March 16, 2001 By: /s/ KENT R. SIVILLO
-------------------------------------
Kent R. Sivillo
Vice President and Treasurer
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this report has been signed below by the following persons on behalf of
the registrant and in the capacities and on the date indicated.
Date: March 16, 2001 By: /s/ MURRAY K. MCCOMAS
-------------------------------------
Murray K. McComas
Chairman of the Board of Directors
Date: March 16, 2001 By: /s/ JOHN E. ZAWACKI
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John E. Zawacki
President, Chief Executive Officer
and Director
(Principal Executive Officer)
Date: March 16, 2001 By: /s/ BLAIR T. SMOULDER
-------------------------------------
Blair T. Smoulder
Executive Vice President
and Director
Date: March 16, 2001 By: /s/ STEVEN M. BLAIR
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Steven M. Blair
Vice President, Customer
Services, and Director
Date: March 16, 2001 By: /s/ DAVID A. BLAIR
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David A. Blair
Secretary and Director
Date: March 16, 2001 By: /s/ KENT R. SIVILLO
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Kent R. Sivillo
Vice President,
Treasurer and Director
(Principal Financial and
Accounting Officer)
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Date: March 16, 2001 By: /s/ ROBERT D. CROWLEY
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Robert D. Crowley
Vice President, Menswear,
and Director
Date: March 16, 2001 By: /s/ THOMAS P. MCKEEVER
-------------------------------------
Thomas P. McKeever
Vice President, Corporate Affairs
and Human Resources, and Director
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Annual Report on Form 10-K
Item 14(a) (1) and (2), and (d)
List of Financial Statements and Financial Statement Schedules
Blair Corporation and Subsidiaries
Warren, Pennsylvania
Year ended December 31, 2000
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Blair Corporation and Subsidiaries
List of Financial Statements and Financial Statement Schedules
Form 10-K -- Item 14(a)(1) and (2), and (d)
The following consolidated financial statements of Blair Corporation, included
in the annual report of the registrant to its stockholders for the year ended
December 31, 2000, are incorporated by reference in Item 8:
-- Consolidated Balance Sheets -- December 31, 2000 and 1999
-- Consolidated Statements of Income -- Years ended December 31, 2000,
1999 and 1998
-- Consolidated Statements of Stockholders' Equity -- Years ended
December 31, 2000, 1999 and 1998
-- Consolidated Statements of Cash Flows -- Years ended December 31,
2000, 1999 and 1998
-- Notes to Consolidated Financial Statements -- December 31, 2000
The following financial statement schedule of Blair Corporation is included in
Item 14(d):
-- Schedule II -- Valuation and Qualifying Accounts
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.
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Blair Corporation and Subsidiaries
Schedule II
Valuation and Qualifying Accounts
December 31, 2000
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
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ADDITIONS-
BALANCE AT CHARGED TO BALANCE
DESCRIPTION BEGINNING COSTS AND DEDUCTIONS- AT END
- ----------- OF PERIOD EXPENSES DESCRIBE OF PERIOD
--------- -------- -------- ---------
Year ended December 31, 2000:
Allowance deducted from
asset account (customer
accounts receivable):
For doubtful accounts $31,489,153 $ 35,932,526(A) $ 27,650,006(B) $39,771,673
For estimated loss on returns 6,431,673 84,955,671 84,394,344(C) 6,993,000
----------- ------------ ------------ -----------
Totals $37,920,826 $120,888,197 $112,044,350 $46,764,673
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Year ended December 31, 1999:
Allowance deducted from
asset account (customer
accounts receivable):
For doubtful accounts $29,224,323 $ 22,468,075(A) $ 20,203,245(B) $31,489,153
For estimated loss on returns 6,250,000 83,262,638 83,080,965(C) 6,431,673
----------- ------------ ------------ -----------
Totals $35,474,323 $105,730,713 $103,284,210 $37,920,826
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Year ended December 31, 1998:
Allowance deducted from
asset account (customer
accounts receivable):
For doubtful accounts $31,984,888 $ 22,033,466(A) $ 24,794,032(B) $29,224,323
For estimated loss on returns 6,495,000 88,927,593 89,172,593(C) 6,250,000
----------- ------------ ------------ -----------
Totals $38,479,888 $110,961,059 $113,966,625 $35,474,323
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Note (A) -- Current year provision for doubtful accounts, charged against
income.
Note (B) -- Accounts charged off, net of recoveries.
Note (C) -- Sales value of merchandise returned.
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