Annual Report (Form 10-K), fiscal year 1994

Item 1. Business.
Strawbridge & Clothier (the "Company") operates 13 department stores at its original location in Philadelphia and in the surrounding Delaware Valley area of Pennsylvania, New Jersey and Delaware. The Company also operates, under the Clover name, 25 discount stores in the same market area as well as in the Lehigh Valley and Lancaster areas of Pennsylvania. The Company is the successor to a business begun in 1868.
All of the Company's department stores carry most of the classes of general merchandise usually offered by full-line department stores. Among the principal types of merchandise sold are men's, women's and children's apparel, including men's and boys' clothing, furnishings and footwear, women's coats, suits, dresses, furs, sportswear, intimate apparel, accessories, shoes and jewelry and infants' and children's clothing and accessories; smallwares, including cosmetics, stationery and candy; home furnishings, including domestics, draperies, lamps, housewares, furniture, rugs, television sets, audio equipment, china, glassware and silverware; and gifts. The department stores also provide various services such as interior decorating, beauty salons, restaurants, jewelry repair and fur storage. The Company has arrangements with several common carriers for the delivery by truck of merchandise to its department store customers throughout the Company's trading area.
The Clover stores offer a complete range of general merchandise exclusive of major appliances and furniture. No home delivery or other services are provided except for cafeteria- style restaurant service in two stores, snack bars in all stores, pharmacies in eight stores and beauty salons in nine stores.
The Company's merchandise is sold under a broad variety of brand names including the Company's own brand names, manufacturers' brand names, and several brand names owned by the Associated Merchandising Corporation, of which the Company is a member.
Strawbridge & Clothier charge cards, VISA, MasterCard, American Express and Discover cards are accepted at both the department stores and Clover stores.
In the fiscal year ended January 29, 1994, approximately 37% of sales were on a cash basis and 63% of sales were credit sales. The Company's stores have sales activity throughout the year. Approximately 30% of annual sales are made in the peak period of November and December.
As of January 29, 1994, the Company had 5,351 full time employees, 1,969 regular part time employees and 4,784 contingent employees who are scheduled as needed.
There has not been any significant change in the kinds of services rendered, or in the markets or methods of distribution, since the beginning of the fiscal year ended January 29, 1994.
The general merchandise business in the Company's principal market of downtown Philadelphia and the surrounding Delaware Valley area of southeastern Pennsylvania, southern New Jersey and northern Delaware is highly competitive. The Company competes on the basis of quality of merchandise, customer service, price and store location. The Company's department and discount stores are in active competition with national chain, regional chain and local retail stores within their market areas, including conventional and discount department stores, specialty stores and mail order companies. Many of the Company's competitors have considerably larger national sales and financial resources than the Company.
Item 2.



Item 2. Properties.
The Company's main department store is in downtown Philadelphia and its 12 suburban branch department stores are located in the surrounding Delaware Valley area of southeastern Pennsylvania (seven stores), southern New Jersey (three stores) and northern Delaware (two stores). The Philadelphia department store contains approximately 1,065,000 square feet of floor area. The suburban branch department stores generally contain from 150,000 to 255,000 square feet, with one store containing 108,000 square feet of floor area. All of the branch department stores are located in shopping centers or malls. The Company's 25 Clover discount stores are located in the same market area as its department stores (15 in southeastern Pennsylvania, six in southern New Jersey and one in northern Delaware), as well as in the Lehigh Valley (two stores) and Lancaster (one store) areas of Pennsylvania. The Clover stores contain from 70,000 to 157,000 square feet of floor area. The Company owns 15 of its stores, of which two are on leased land and six are subject to mortgages or similar liens. The Company leases the remainder of the stores from third parties with, in most cases, long-term renewal rights or an option to purchase. The Company also maintains warehouse and distribution facilities in Philadelphia and New Jersey.
Item 3.

Item 3. Legal Proceedings.
There are no material pending legal proceedings to which the Company or its subsidiaries is a party or of which any of their property is subject. The Company is a party to ordinary
routine legal proceedings incidental to the conduct of its business, none of which are material.
Item 4.

Item 4. Submission of Matters to a Vote of Security Holders.
This item is not applicable because there were no matters submitted to a vote of security holders during the fourth quarter of fiscal year 1993.
Executive Officers of the Registrant.
Office Held Name Age Office(1) Since (2)
Francis R. 56 Chairman of the Board 1984 Strawbridge, III(3) Peter S. Strawbridge(3) 55 President 1979
Warren W. White 62 Executive Vice 1979 President
Steven L. 50 Vice President, Strawbridge(3) Treasurer and 1982 Secretary Ronald B. Avellino 55 Vice President 1987
Louis F. Busico 59 Vice President 1979 Harry T. Hinkel 55 Vice President 1993
Robert A. Hoffner 51 Vice President 1984
Charles D. Hollander 63 Vice President 1988 Alexander B. Jervis 50 Vice President 1992
Alice T. Kanigowski 55 Vice President 1986 John J. Leahy 63 Vice President 1969
Robert G. Muskas 55 Vice President 1980
Thelma A. Newman 54 Vice President 1994 E. Spencer Quill 52 Vice President 1990
Thomas S. Rittenhouse 52 Vice President 1978 G. Leonard Shea 60 Vice President 1977
David W. Strawbridge(3) 54 Vice President 1978
William A. Timmons 58 Vice President 1979
__________
(1) Each executive officer has been employed by the Company as an executive officer for at least the past five years, except for E. Spencer Quill who was Director of Administration and Distribution prior to his election in 1990; Alexander B. Jervis who was Director of Assets Protection prior to his election in 1992; Harry T. Hinkel who was a Store Manager prior to his election in 1993; and Thelma A. Newman who was a Divisional Merchandise Manager prior to her election in 1994.
(2) The executive officers of the Company are elected annually to hold office until the annual organization meeting of the Board of Directors and until their respective successors shall have been duly elected and qualified.
(3) Peter S. Strawbridge and Steven L. Strawbridge are brothers and are first cousins of Francis R. Strawbridge, III and David W. Strawbridge, who also are brothers.
PART II
Item 5.

Item 5. Market for the Registrant's Common Equity and Related Stockholder Matters.
The information appearing in the section captioned "Market and Dividend Information" from the portions of the Company's 1993 Annual Report to shareholders filed as Exhibit 13 to this Form 10-K is incorporated herein by reference.
Item 6.

Item 6. Selected Financial Data.
The information appearing in the section captioned "Ten-Year Financial Summary" from the portions of the Company's 1993 Annual Report to shareholders filed as Exhibit 13 to this Form 10-K is incorporated herein by reference.
Item 7.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.
The information appearing in the section captioned "Management's Discussion and Analysis of Financial Condition and Results of Operations" from the portions of the Company's 1993 Annual Report to shareholders filed as Exhibit 13 to this Form 10-K is incorporated herein by reference.
Item 8.


Item 8. Financial Statements and Supplementary Data.
The information appearing in the sections captioned "Consolidated Statements of Operations," "Consolidated Balance Sheets," "Consolidated Statements of Cash Flows," "Consolidated
Statements of Common Shareholders' Equity," "Notes to Consolidated Financial Statements," "Statement of Management Responsibility" and "Report of Ernst & Young, Independent Auditors" from the portions of the Company's 1993 Annual Report to shareholders filed as Exhibit 13 to this Form 10-K are incorporated herein by reference.
The information appearing in the section captioned "Quarterly Results of Operations" from the portions of the Company's 1993 Annual Report to shareholders filed as Exhibit 13 to this Form 10-K is incorporated herein by reference.
Item 9.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
This item is not applicable.
PART III
Item 10.



Item 10. Directors and Executive Officers of the Registrant.
The information as to directors required by this item is incorporated herein by reference from the section captioned "Election of Directors" in the Company's definitive 1994 annual meeting proxy statement which has been filed pursuant to Regulation 14A. The required information as to executive officers is set forth in Part I hereof and incorporated herein by reference.
Item 11.

Item 11. Executive Compensation.
The information required by this item is incorporated herein by reference from the section captioned "Executive Compensation" in the Company's definitive 1994 annual meeting proxy statement which has been filed pursuant to Regulation 14A.
Item 12.

Item 12. Security Ownership of Certain Beneficial Owners and Management.
The information called for by this item is incorporated herein by reference from the section captioned "Beneficial Ownership of Voting Securities" in the Company's definitive 1994 annual meeting proxy statement which has been filed pursuant to Regulation 14A.
Item 13.

Item 13. Certain Relationships and Related Transactions.
None.
PART IV
Item 14.

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K.
(a) All financial statements and schedules.
A list of the financial statements and supporting schedules included in this Report appears on page hereof.
(b) Reports on Form 8-K.
No reports on Form 8-K were filed during the last fiscal quarter of the fiscal year covered by this Report.
(c) Exhibits.
(3) (i) Restated Articles of the Company filed on January 3, 1990 with the Department of State of the Commonwealth of Pennsylvania, as filed as Exhibit 3(a) to Form 10-K for the fiscal year ended February 3, 1990, are incorporated herein by reference.
(ii) By-Laws, effective October 1, 1989, as filed as Exhibit 3(b) to Form 10-K for the fiscal year ended February 3, 1990, are incorporated herein by reference.
(4.1) Note Purchase Agreement dated as of November 1, 1977 relating to 8 1/2% Secured Notes of S&C, Center Square, Inc. due August 1, 2003.*
(4.2) Note Agreement dated November 22, 1985 relating to 11.50% Senior Notes of Strawbridge & Clothier due November 15, 2000.*
(4.3) Indenture dated as of October 15, 1993 relating to 6 5/8% Notes of Strawbridge & Clothier due October 15, 2003.*
(4.4) Note Agreement dated September 14, 1989 relating to Strawbridge & Clothier Senior Notes, 9.20% Series A due
* Pursuant to Item 601(b)(4)(iii) of Regulation S-K, the document listed is not filed with this Report. Registrant agrees to furnish a copy of such document to the Commission upon request.
September 30, 2004 and 9.00% Series B due September 30, 1999.*
(4.5) Note Agreement dated October 13, 1992 relating to Strawbridge & Clothier 7.04% Senior Notes due October 15, 1997.*
(10) Management Contracts or Compensatory Plans or Arrangements Required to be filed as Exhibits:
(10.1) Deferred Compensation Plan for Key Executive Employees of Strawbridge & Clothier as amended and restated effective February 1, 1985, as filed as Exhibit (10) to Form 10-K for the fiscal year ended February 2, 1985, is incorporated herein by reference.
(10.2) 1985 Stock Option Plan of Strawbridge & Clothier as amended effective February 22, 1989, as filed as Exhibit 10(b) to Form 10-K for the fiscal year ended January 28, 1989, is incorporated herein by reference.
(10.3) 1991 Stock Option Plan of Strawbridge & Clothier, as filed as Exhibit 10(c) to Form 10-K for the fiscal year ended February 1, 1992, is incorporated herein by reference.
(10.4.1) Form of Employment Agreement for executive officers of the Company as filed as Exhibit 10.4.1 to Form 10-K for the fiscal year ended January 30, 1993, is incorporated herein by reference.
(10.4.2) Schedule of certain terms of Employment Agreements for the executive officers named in the Company's Summary Compensation Table for the fiscal year ended January 29, 1994.
(11) Statement re: Computation of per share earnings.
(13) Portions of the 1993 Annual Report to Shareholders, included as part of this Report.
(21) Subsidiaries of the Registrant, as filed as Exhibit 21 to Form 10-K for the fiscal year ended January 30, 1993, is incorporated herein by reference.
(23) Consent of Ernst & Young, Independent Auditors.
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.
STRAWBRIDGE & CLOTHIER (Registrant)
By /s/Francis R. Strawbridge, III Francis R. Strawbridge, III Chairman of the Board
Dated: April 27, 1994
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.
Margaret S. Clews 04/27/1994 Isaac H. Clothier, IV 04/27/1994 Margaret S. Clews Isaac H. Clothier, IV Director Director
James M. Gassaway 04/27/1994 Richard H. Hall 04/27/1994 James M. Gassaway Richard H. Hall Director Director
Thomas B. Harvey, Jr. 04/27/1994 Anne C. Longstreth 04/27/1994 Thomas B. Harvey, Jr. Anne C. Longstreth Director Director
Paul E. Shipley 04/27/1994 David W. Strawbridge 04/27/1994 Paul E. Shipley David W. Strawbridge Director Director and Vice President
Francis R. Strawbridge, III 04/27/1994 Francis R. Strawbridge, III Director and Chairman of the Board (co-principal executive officer)
Peter S. Strawbridge 04/27/1994 Steven L. Strawbridge 04/27/1994 Peter S. Strawbridge Steven L. Strawbridge Director and President Director, Vice President (co-principal executive officer) Treasurer and Secretary (principal financial officer)
Thomas S. Rittenhouse 04/27/1994 Warren W. White 04/27/1994 Thomas S. Rittenhouse Warren W. White Vice President and Controller Director and Executive (principal accounting officer) Vice President
FORM 10-K -- ITEM 14(a)(1) and (2)
LIST OF FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
STRAWBRIDGE & CLOTHIER AND SUBSIDIARIES
The following consolidated financial statements of Strawbridge & Clothier and subsidiaries and the report of independent auditors thereon and a statement of management responsibility, included in the 1993 Annual Report to shareholders, are incorporated by reference in Item 8:
Consolidated Statements of Operations--Fiscal years ended January 29, 1994, January 30, 1993 and February 1, 1992
Consolidated Balance Sheets--January 29, 1994 and January 30, 1993
Consolidated Statements of Cash Flows--Fiscal years ended January 29, 1994, January 30, 1993 and February 1, 1992
Consolidated Statements of Common Shareholders' Equity-- Fiscal years ended January 29, 1994, January 30, 1993 and February 1, 1992
Notes to Consolidated Financial Statements
The following consolidated financial statement schedules of Strawbridge & Clothier and subsidiaries are included herein:
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.
Strawbridge & Clothier and Subsidiaries
Schedule X--Supplementary Income Statement Information
(in thousands)
COL. A COL. B
Item Charged to Costs and Expenses
Fiscal Year 1993 1992 1991
Advertising costs $28,835 $25,886 $25,971
Amounts for maintenance and repairs, depreciation and amortization of intangible assets, taxes, other than payroll and income taxes, and royalties are not presented because the registrant does not incur such expenses or because such amounts are less than 1% of total sales and revenues.
Exhibit Index
Exhibit No. Page No.
(10.4.2) Schedule of certain terms of Employment Agreements for the executive officers named in the Company's Summary Compensation Table for the fiscal year ended January 29, 1994.
(11) Statement re: Computation of per share earnings.
(13) Portions of the 1993 Annual Report to Shareholders, included as part of this Report.
(23) Consent of Ernst & Young, Independent Auditors.