Mercantile Stores Co Inc – ‘10-K’ for 1/31/98

As of:  Monday, 4/27/98   ·   For:  1/31/98   ·   Accession #:  64923-98-5   ·   File #:  1-03339

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Annual Report   —   Form 10-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-K        Annual Report                                         10     39K 
 2: EX-13       Annual or Quarterly Report to Security Holders        27    131K 
 3: EX-21       Subsidiaries of the Registrant                         1      7K 
 4: EX-23       Consent of Experts or Counsel                          1      5K 
 5: EX-24       Power of Attorney                                      1      6K 
 6: EX-27       Financial Data Schedule (Pre-XBRL)                     1      8K 

10-K   —   Annual Report
Document Table of Contents

10-K
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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 January 31, 1998      

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 1-3339         
MERCANTILE STORES COMPANY, INC.       
(Exact name of registrant as specified in its charter)        

Delaware        
(State or other jurisdiction of incorporation)    

51-0032941      
(I.R.S. Employer Identification No.)    

9450 Seward Road Fairfield, Ohio                        45014     
(Address of principal executive offices)                    (Zip Code)          

Registrant's telephone number, including area code:         (513) 881-8000    

Securities registered pursuant to Section 12 (b) of the Act:        

                                          Name of each exchange on
      Title of each class                     which registered
         ___________________               _________________________
   Common stock $ .14 2/3 par value        The New York Stock Exchange

Securities registered pursuant to Section 12 (g) of the Act:   NONE       

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.   [ X ]                                            

The aggregate market value of the Company's voting stock held by                
non-affiliates based on the closing price on the New York Stock Exchange        
at April 20, 1998 was $1,506,355,740.                                           

The number of shares outstanding of the registrant's common stock,              
$ .14 2/3 par value was 36,748,550 at April 23, 1998.                           

DOCUMENTS INCORPORATED BY REFERENCE       

1.  Portions of Registrant's 1997 Annual Report to Stockholders are             
incorporated into Parts I and II.                                       

2.  Portions of Registrant's Proxy Statement, dated April 24, 1998,             
relating to the Annual Meeting of Stockholders to be held on            
May 27, 1998 filed pursuant to Regulation 14A, are incorporated         
by reference into Part III of this Form 10-K.                           

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PART I        

Item 1.    Business.                                                            

Mercantile Stores Company, Inc.  ("Company" or "Registrant") was incorporated   
under the laws of the State of Delaware on January 10, 1919.  The Company is    
listed on the New York Stock Exchange (NYSE designation of MST) and is engaged  
in general merchandise department store retailing.                              

The Company's business is highly competitive.  The Company's retailing          
strategy is to cater to middle and upper income customers by carrying wide      
assortments of national brand items and goods sold under the Company's private  
labels, with emphasis on apparel, accessories and fashion home products.        
Its stores compete with other national, regional and local retail               
establishments, including department stores, mass merchants, specialty stores   
and discount stores which carry similar lines of merchandise.  The Company's    
competitive methodology focuses on value, customer service, fashion, selection, 
marketing and store location.                                                   

The retail business is highly seasonal.  The fourth quarter, which includes     
the Christmas season, is the most significant selling period.  For the year     
ended January 31, 1998, the fourth quarter accounted for approximately 32% of   
consolidated retail sales and 56% of consolidated net income.                   

The Company regularly employs, on a full or part-time basis, an average of      
approximately 34,200 associates, of which approximately 19,500 are considered   
full-time equivalents.                                                          

The following portions from the Registrant's Annual Report to Stockholders for  
the fiscal year ended January 31, 1998 are incorporated herein by reference:    
Financial Highlights (page 1); Management's Discussion and Analysis             
(pages 5-8); Note 1 (pages 15-16) and Note 2 (page 16) of Notes to              
Consolidated Financial Statements; Five-Year Selected Financial Data            
(pages 24-25); Store Divisions and Locations (pages 26-27).                     

Item 2.    Properties.                                                          

The Company's typical store averages 170,000 square feet.  These stores are     
located in seventeen different states and operate under thirteen different      
names.  The following table summarizes the property ownership and applicable    
square footage of the 102 department stores and 16 home fashion stores          
operated by the Company as of January 31, 1998:                                 

          Home
      Department       Fashion      Square
         Stores          Units       Footage

Owned Stores              61              2        9,932,508              
Leased Stores             41             14        7,397,998              
        ________        ________    __________
Total            102             16       17,330,506      

Management's Discussion and Analysis (pages 5-8), Note 1 (pages 15-16) of       
Notes to Consolidated Financial Statements and Store Divisions and Locations    
(pages 26-27) from the Registrant's Annual Report to Stockholders for the       
fiscal year ended January 31, 1998 are incorporated herein by reference.        

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Item 3.    Legal Proceedings.                                                   

None.                                                                           

Item 4.    Submission of Matters to a Vote of Security Holders.                 

None.                                                                           

PART II       

Item 5.    Market for Registrant's Common Equity and Related Stockholder        
Matters.                                                  

Market and Dividend Information (page 9) and Stockholder Information            
(inside back cover) from the Registrant's Annual Report to Stockholders         
for the fiscal year ended January 31, 1998 are incorporated herein by           
reference.                                                                      

Item 6.    Selected Financial Data.                                             

The Five-Year Selected Financial Data (pages 24-25) and Notes to Consolidated   
Financial Statements (pages 15-22) from the Registrant's Annual Report to       
Stockholders for the fiscal year ended January 31, 1998 are incorporated        
herein by reference.                                                            

Item 7.    Management's Discussion and Analysis of Financial Condition and      
Results of Operations.                                    

Management's Discussion and Analysis (pages 5-8) from the Registrant's Annual   
Report to Stockholders for the fiscal year ended January 31, 1998 are           
incorporated herein by reference.                                               

Item 7A.   Quantitative and Qualitative Disclosures About Market Risk.          

Not applicable.                                                                 

Item 8.    Financial Statements and Supplementary Data.                         

The Consolidated Financial Statements (pages 11-14), Notes to Consolidated      
Financial Statements (pages 15-22), Report of Independent Public Accountants    
(page 10) and Quarterly Results (page 23) from the Registrant's Annual Report   
to Stockholders for the fiscal year ended January 31, 1998 are incorporated     
herein by reference.                                                            

Item 9.    Changes in and Disagreements with Accountants on Accounting and      
Financial Disclosures.                                    

None.                                                                           
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PART III        

Item 10.   Directors and Executive Officers of the Registrant.                  

The information set forth under the captions "Election of Directors",           
"Stock Ownership of Management", "Other Executive Officers" and "Section 16(a)  
Beneficial Ownership Reporting Compliance" included in the Registrant's         
definitive Proxy Statement, dated April 24, 1998, relating to the Annual        
Meeting of Stockholders to be held on May 27, 1998 and filed pursuant to        
Regulation 14A, is incorporated herein by reference.                            

Item 11.   Executive Compensation.                                              

The information set forth under the caption "Management Remuneration",          
included in the Registrant's definitive Proxy Statement, dated April 24, 1998,  
relating to the Annual Meeting of Stockholders to be held on May 27, 1998       
and filed pursuant to Regulation 14A, is incorporated herein by reference.      
Notwithstanding the foregoing, the information set forth under the captions     
"Report of the Compensation Committee" and "Performance Graph" in said Proxy    
Statement, is not incorporated herein by reference or in any other filing of    
the Registrant.                                                                 

Item 12.  Security Ownership of Certain Beneficial Owners and Management.       

The information set forth under the captions "Stock Ownership of Management"    
and "Stock Ownership of Certain Beneficial Owners" included in the Registrant's 
definitive Proxy Statement, dated April 24, 1998, relating to the Annual        
Meeting of Stockholders to be held on May 27, 1998 and filed pursuant to        
Regulation 14A, is incorporated herein by reference.                            

Item 13.   Certain Relationships and Related Transactions.                      

The information set forth under the caption "Transactions with Management and   
Others" included in the Registrant's definitive Proxy Statement, dated          
April 24, 1998, relating to the Annual Meeting of Stockholders to be held on    
May 27, 1998 and filed pursuant to Regulation 14A, is incorporated herein by    
reference.                                                                      

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PART IV       

Item 14.   Exhibits, Financial Statement Schedules and Reports on Form 8-K.     

A.   1.  The following Consolidated Financial Statements of Mercantile          
  Stores Company, Inc., Notes to Consolidated Financial Statements
     and Report of Independent Public Accountants, from the Registrant's
Annual Report to Stockholders for the fiscal year ended       
January 31, 1998 are incorporated herein by reference:        

 (a)   Statements of Consolidated Income and Retained Earnings for
     the fiscal years ended January 31, 1998, February 1, 1997
and February 3, 1996 - page 11.                     

(b)   Consolidated Balance Sheets as of January 31, 1998 and    
February 1, 1997 - pages 12 and 13.                 

(c)   Statements of Consolidated Cash Flows for the fiscal years
         ended January 31, 1998, February 1, 1997 and February 3, 1996
- page 14.                                          

(d)   Notes to Consolidated Financial Statements - pages 15-22. 

(e)   Report of Independent Public Accountants,  page - 10.     

2.  Financial Statement Schedules of the Registrant and Consolidated  
Subsidiaries included herein:                                 

(a)   Report of Independent Public Accountants on the schedule  
listed below.                                       

(b)   Schedule II -  Valuation and Qualifying Accounts          

All other schedules have been omitted as they are inapplicable or the           
information required is shown in the Consolidated Financial Statements          
or the Notes thereto.                                                           

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3.  Exhibits:                                                         

     (3a) - The Restated Certificate of Incorporation of Mercantile Stores
            Company, Inc., as amended, is incorporated herein by reference
       from the Registrant's Form 10-K for the fiscal year ended
January 31, 1989.                                 

   (3b) - The Registrant's Bylaws, as amended, are incorporated herein
         by reference from the Registrant's Form 10-K for the fiscal
year ended January 31, 1989.                      

  (4) - The Indenture agreement between Mercantile Stores Company,
    Inc. and The Fifth Third Bank, as Trustee, dated as of
    July 1, 1992, is incorporated herein by reference from
Registration Statement No.33-50604, Exhibit 4.1.  

*  (10.a) - The Form of Severance Protection Agreement, dated as of       
       May 1, 1995, between David L. Nichols and the Company, is
    incorporated herein by reference from the Registrant's
   Form 10-K for the fiscal year ended February 3, 1996.

*  (10.b) - The Form of Severance Protection Agreement, dated as of       
            May 1, 1995, between the Company and each of James M. McVicker
      and Randolph L. Burnette and, dated as of April 1, 1997,
      between the Company and each of Kathryn M. Muldowney and
            Louis L. Ripley,  is incorporated herein by reference from the
Registrant's Form 10-K for the fiscal year ended  
February 3, 1996.                                 

*  (10.c) - Mercantile Stores Company, Inc. 1996 Stock Option Plan.       

(13) - The Registrant's Annual Report to Stockholders for the   
fiscal year ended January 31, 1998.               

(21) - A listing of the subsidiaries of the Registrant.         

(23) - Consent of Independent Public Accountants.               

(24) - Power of Attorney.                                       

(27) - Financial Data Schedule.                                 

______________________________________________________        

*  -  Management contract or compensatory plan.                           

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B.   No reports on Form 8-K have been filed during the fourth quarter of the    
fiscal year ended January 31, 1998.                                   

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.                    

           MERCANTILE STORES COMPANY, INC.
            (Registrant)

        BY:      s/ David L. Nichols
                ____________________________________
                David L. Nichols
                 Chairman of the Board

Date: April 23, 1998.                                                           

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Pursuant to the requirements of the Securities and 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/ David L. Nichols                                                     
David L. Nichols                              * Lawrence R. Pugh  
(Chairman of the Board)                              (Director)       
As Principal Executive Officer                                              

s/ James M. McVicker                                                  
  James M. McVicker                            * Gerrish H. Milliken
(Senior Vice President and                          (Director)      
Chief Financial Officer)                                        

* John A. Herdeg                                * Minot K. Milliken   
(Director)                                        (Director)    

* Roger K. Smith                                * Roger Milliken      
(Director)                                        (Director)    

  * Francis G. Rodgers                            * H. Keith H. Brodie, MD
(Director)                                        (Director)    

* Thomas J. Malone                                                    
(Director)                                                      

*BY:   s/ David L. Nichols                                                      
____________________________________                                            
David L. Nichols                                                

Date:    April 23, 1998                                                         

An original Power of Attorney authorizing David L. Nichols, James M. McVicker   
and William A. Carr and each of them to sign this report hereto as Attorneys    
for Directors of the Registrant is being filed concurrently with the Securities 
and Exchange Commission.                                                        

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Report of Independent Public Accounts       

To the Stockholders and Board of Directors of                         
Mercantile Stores Company, Inc.:                                      

We have audited, in accordance with generally accepted auditing       
 standards, the consolidated financial statements included in Mercantile
Stores Company, Inc.'s annual report to stockholders incorporated by  
reference in this Form 10-K, and have issued our report thereon dated 
  April 3, 1998.  Our audit was made for the purpose of forming an opinion
   on those statements taken as a whole.  The schedule listed under Part IV,
Item 14(A)(2)(b) is the responsibility of the Company's management and
 is presented for purposes of complying with the Securities and Exchange
 Commission's rules and is not a part of the basic financial statements.
This schedule has been subjected to the auditing procedures applied in
 the audit of the basic financial statements and, in our opinion, fairly
states in all material respects the financial data required to be set 
forth therein in relation to the basic financial statements taken as a
whole.                                                                

 Cincinnati, Ohio                                    ARTHUR ANDERSEN LLP
April 3, 1998                                                         

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                     MERCANTILE STORES COMPANY, INC.                                        
                               SCHEDULE II                                                  
                    VALUATION AND QUALIFYING ACCOUNTS                                       
                             (in thousands)                                                 


     Column A            Column B        Column C - Additions      Column D       Column E  
                         Balance at     Charged to     Charged to  Deductions     Balance at
                         beginning      costs and       other      write offs net     end of
Description              of period       expenses      accounts    of recoveries     period 

                                                                                            
Allowance for                                                                               
 Doubtful Accounts:                                                                         

Year Ended                                                                                  
  January 31, 1998       $16,425        $19,541           $0        $17,888        $18,078  

Year Ended                                                                                  
  February 1, 1997       $16,499        $16,817           $0        $16,891        $16,425  

Year Ended                                                                                  
  February 3, 1996       $ 3,100        $20,282           $0        $ 6,883         $16,499 

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Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘10-K’ Filing		Date		First		Last			Other Filings
		5/27/98		1		4			8-K
Filed on:		4/27/98
		4/24/98		1		4
		4/23/98		1		8			DEF 14A
		4/20/98		1
		4/3/98		9
For Period End:		1/31/98		1		10			DEF 14A
		4/1/97		6
		2/1/97		5		10			10-K,  DEF 14A
		2/3/96		5		10			10-K,  DEF 14A
		5/1/95		6
		7/1/92		6
									List all Filings