| Circuit City Stores Inc - Carmax Group | |||
| Ticker: | KMX | 9950 Mayland Drive | |
| Exchange: | New York Stock Exchange | Richmond, VA 23233 | |
| Industry: | Retail (SIC Code 5521) | (804) 527-4000 | |
| Type of Shares: | Common Shares | Filing Date: | 11/13/96 | |
| U.S. Shares: | 21,860,000 | Offer Date: | 2/4/97 | |
| Non-U.S. Shares: | 0 | Filing Range: | $18.00 - $20.00 | |
| Primary Shares: | 21,860,000 | Offer Price: | $20.00 | |
| Secondary Shares: | 0 | Gross Spread: | $1.10 | |
| Offering Amount: | $415,340,000 | Selling: | $0.66 | |
| Expenses: | $1,297,360 | Reallowance: | $0.10 | |
| Shares Out After: | - |
| Manager | Tier | Phone |
| Morgan Stanley & Co. Incorporated | Lead Manager | (212) 761-5900 |
| Goldman, Sachs & Co. | Co-manager | (212) 902-5959 |
| Wheat First Butcher & Singer Capital Markets | Co-manager | (804) 782-3278 |
| Issuer's Law Firm: | McGuire Woods Battle & Boothe |
| Bank's Law Firm: | Simpson, Thacher & Bartlett |
Dollar amounts in U.S. millions except for per share data | |||||
| 6 Month Ending Financials | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 2/29/96 | 8/31/96 | 8/31/95 | 8/31/96 | ||
| Revenue: | $276.00 | $257.00 | $128.00 | Assets: | $137.00 |
| Net Income: | $5.00 | $1.00 | $2.00 | Curr Assets: | |
| EPS: | Liabilities: | $149.00 | |||
| Prior EPS: | Curr Liabilities: | ||||
| Cash Flow/Oper: | Equity: | -$12.00 | |||
| Cash Flow/Fin: | Cash: | ||||
| Cash Flow/Inv: | |||||
| Business Description |
| The company is a leading retailer of used cars and light trucks in the United States with six stores located in the Southeast and one vehicle reconditioning center in Orlando Florida. The company purchases, reconditions and sells used vehicles at each of its stores and sells used vehicles at each of its stores and sells new vehicles at one of its Atlanta, Georgia locations under a franchise agreement with Chrysler Corporation. CarMax provides its customers with a full range of related services, including the financing of vehicle purchases through its own financing unit, First North American Credit Corporation, and through third parties, and the sale of service policies. Since opening of the first store in Richmond, Virginia in October 1993, CarMax's retail operations have grown rapidly, with total revenues of $77 million during the first full fiscal year and $257 million for the six months ended August 31, 1996. |
| Competition |
| The automotive retailing industry is highly competitive. Consumers typically have many choices in deciding where to purchase a used or new vehicle, particularly in the larger markets that the company intends to target as part of its expansion plan. In both the used- and new-vehicle markets, Car Max seeks to distinguish itself from traditional dealerships through its sales approach and other innovative operating strategies. |
| Business Plan |
| The company believes its operating strategies and the extensive experience of its senior management team will enable it to capitalize on the significant opportunities available in the large, highly-fragmented automotive retailing industry. The company intends to aggressively grow its business through 1) a rapid rollout of used-vehicle stores; 2) the expansion of retail repair service operations; and 3) the addition of selected new-vehicle franchises. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used to finance part of the company's expansion plans for the CarMax Group and to repay the CarMax Group's allocated portion of company indebtedness that was incurred to finance CarMax's growth to date. |