8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  November 20, 2003

SHOPKO STORES, INC.

(Exact name of registrant as specified in its charter)

       Wisconsin

1-10876

41-0985054  

(State or other jurisdiction

(Commission file number)

(IRS Employer  

      of incorporation)

Identification No.)

700 Pilgrim Way

Green Bay, Wisconsin 54304

(Address of principal executive offices)

Registrant’s telephone number, including area code: (920) 429-2211

Item 7.

Financial Statements and Exhibits

(c)

Exhibits

This exhibit is furnished pursuant to Item 12 and shall not be deemed to be “filed.”

Exhibit No.

Description

99.1

Press Release Dated November 20, 2003

Item 12.

Results of Operations and Financial Condition

On November 20, 2003, Shopko Stores, Inc. (“Shopko”) issued a press release announcing its financial results for the quarter ended November 1, 2003.  A copy of the press release is attached hereto as exhibit 99.1.

The information in this Report, including the exhibit attached hereto, is furnished solely pursuant to Item 12 of this Form 8-K.  Consequently, it is not deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liabilities of that section. It may only be incorporated by reference in another filing under the Securities Act of 1933 or the Exchange Act of 1934 if such subsequent filing specifically references this Form 8-K.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

SHOPKO STORES, INC.

Date:  November 20, 2003

  /s/ Peter G. Vandenhouten                   

Peter G. Vandenhouten

Assistant General Counsel

and Secretary

EXHIBIT INDEX

Exhibit No.

Description

99.1

Press Release dated November 20, 2003

EX-99.1

Exhibit 99.1

NEWS RELEASE

Contacts:

Media - John Vigeland

(920) 429-4132

Investors - R. John Pindred

(920) 429-7039

SHOPKO REPORTS THIRD QUARTER RESULTS

(Company Maintains Fiscal 2003 Guidance)

GREEN BAY, Wis. (November 20, 2003) ShopKo Stores, Inc., (NYSE: SKO), today announced financial results for the third quarter ended November 1, 2003. Diluted earnings per share for the third quarter were $0.03 compared with earnings per share of $0.03 last year. Net income for the third quarter was $1.0 million compared with net income of $0.9 million last year.

Consolidated sales for the third quarter were $758.5 million compared with $769.6 million last year. Consolidated comparable store sales for the third quarter decreased 1.3 percent.

Commenting on the quarter, ShopKo Stores, Inc. President and Chief Executive Officer Sam Duncan said, "We are pleased to report earnings that were flat compared with last year, despite disappointing sales at the ShopKo division. Pamida posted its third consecutive quarter of positive comp sales as customers frequent our convenient pharmacies and embrace our Hometown Values offering."

Consolidated gross margin as a percent of sales for the third quarter was 25.3 percent compared with 24.8 percent last year. This improvement is primarily attributable to the adoption of EITF No. 02-16 and reduced shrinkage, partially offset by lower merchandise margins.

Consolidated selling, general and administrative expenses (SG&A) as a percent of sales for the third quarter were 21.8 percent compared with 20.6 percent last year. The SG&A rate increase was primarily attributable to the adoption of EITF No. 02-16 and lower sales.

Other Factors

Interest expense was $8.0 million compared with $13.3 million last year, a reduction of $5.3 million, due primarily to reduced debt levels. Debt declined by $89.4 million from the third quarter of 2002.

The effective tax rate remained at 39.7 percent for the quarter.

Year to Date 2003

For the thirty-nine weeks ended November 1, 2003, consolidated sales were $2,231.1 million compared with $2,281.7 million last year. Net income was $7.6 million compared with last year's income of $8.6 million, before the cumulative effect of an accounting change related to the adoption of SFAS No. 142 in fiscal 2002. Diluted earnings per share were $0.26 compared with earnings of $0.29 before the cumulative effect of adopting SFAS No. 142 last year.

Fourth Quarter/Fiscal 2003 Outlook

Despite the improving economy, the company remains cautious in its outlook and therefore expects consolidated comparable store sales for the fourth quarter ending January 31, 2004 to be flat compared with last year. Fourth quarter earnings per share are expected to be at the low end of the $1.15 to $1.25 range.

For the fiscal year ending January 31, 2004, the company continues to expect earnings per share to be at the low end of the $1.40 to $1.50 range.

2004 Capital

As previously announced, the company anticipates capital spending of approximately $100.0 million in fiscal 2004. These funds will provide for up to ten ShopKo remodels, three new ShopKo Express Rx™ stores, 50 Pamida remodels, 16 new Pamida pharmacies, completion of the Omaha DC consolidation project, and significant investments in technology infrastructure.

Third Quarter Conference Call Information

ShopKo Stores, Inc. will host a conference call and real-time webcast November 20, 2003, at 10:30 a.m. Central Standard Time (CST) to discuss third quarter results and fiscal 2003 business outlook. Participants may access the conference by dialing 1-800-860-2442 and asking for the ShopKo Stores, Inc. conference call. The webcast will be archived for two weeks at www.shopko.com.

The call will be rebroadcast immediately following the call through November 30, 2003. The replay can be accessed by dialing 1-877-344-7529 or 412-858-1440. When prompted for an account number dial 364#, then dial 1 for the recorded conference. When prompted for the conference number dial 330820#, then press 1 to begin the playback.

ShopKo Stores, Inc., a Fortune 500 company headquartered in Green Bay, Wis., is a customer-driven retailer of quality goods and services in two distinct market environments. The company operates 361 stores in 23 states throughout the Midwest, Western Mountain and Pacific Northwest. One hundred forty-one multi department ShopKo stores are located in mid-sized to larger cities and 220 convenient one-stop Pamida stores provide Hometown Values to customers in smaller communities of rural America. For more information about ShopKo or Pamida visit our website at www.shopko.com.

This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements regarding expected sales, earnings per share, capital expenditure plans and other financial results. Such statements are subject to important factors that could cause ShopKo's actual results to differ materially from those anticipated by the forward-looking statements including those referenced in ShopKo's current annual report on Form 10-K or as may be described from time to time in ShopKo's subsequent SEC filings; and such factors are incorporated by reference.

#####

Consolidated Sales Summary (dollars in millions)

Third Quarter

Business Segments	08/03/03- 11/01/03 (13 weeks)	08/04/02- 11/02/02 (13 weeks)	Change Total**	Change Comp* (13 weeks vs. 13 weeks)
ShopKo	$568.5	$584.1	(2.7)%	(2.7)%
Pamida*	190.0	185.5	2.4%	3.3%
Consolidated	$758.5	$769.6	(1.4)%	(1.3)%

*Comparable store sales represent sales of those stores open during both fiscal years.

**Pamida division total sales variance reflects sales in the prior year periods from seven locations, which have been closed and not replaced, and two new Pamida locations opened in the month of September.

ShopKo Stores, Inc. and
Subsidiaries
Consolidated Statements of Operations
Third Quarter and Year to Date

		13 Weeks		13 Weeks		39 Weeks		39 Weeks
		Ended		Ended		Ended		Ended
		November 1,		November 2,		November 1,		November 2,
(In thousands, except per share data)		2003		2002		2003		2002
Revenues:
Net sales	$	758,543		769,610	$	2,231,152	$	2,281,743
Licensed department rentals and other income		3,483		3,351		9,770		9,674
		762,026		772,961		2,240,922		2,291,417
Costs and expenses:
Cost of sales		566,739		578,707		1,654,953		1,706,448
Gross margin		191,804		190,903		576,199		575,295
Selling, general and administrative expenses		165,165		158,799		482,097		469,313
Depreciation and amortization expenses		20,490		20,667		62,068		62,276
		185,655		179,466		544,165		531,589
Income from operations		9,632		14,788		41,804		53,380
Interest expense - net		8,033		13,334		29,249		39,204
Earnings before income taxes and accounting change		1,599		1,454		12,555		14,176
Provision for income taxes		635		577		4,987		5,622
Earnings before accounting change		964		877		7,568		8,554
Cumulative effect of accounting change		-		-		-		(186,052)
Net earnings (loss)	$	964		877	$	7,568	$	(177,498)
		=======		======		=======		=======
Basic earnings (loss) per share of common stock:
Earnings before cumulative effect of accounting change	$	0.03		0.03	$	0.26	$	0.30
Cumulative effect of accounting change		-		-		-		(6.46)
Net earnings (loss)	$	0.03		0.03	$	0.26	$	(6.17)
		=======		======		=======		=======
Diluted earnings (loss) per share of common stock:
Earnings before cumulative effect of accounting change	$	0.03		0.03	$	0.26	$	0.29
Cumulative effect of accounting change		-		-		-		(6.36)
Net earnings (loss)	$	0.03		0.03	$	0.26	$	(6.07)
		=======		======		=======		=======
Weighted average number of common
shares outstanding - basic		29,034		28,827		28,980		28,788
Weighted average number of common
shares outstanding - diluted		29,379		29,267		29,261		29,265
ShopKo Stores, Inc. and Subsidiaries Consolidated Statements of Operations Percents of Sales Third Quarter and Year to Date
		13 Weeks		13 Weeks		39 Weeks		39 Weeks
		Ended		Ended		Ended		Ended
		November 1,		November 2,		November 1,		November 2,
		2003		2002		2003		2002
Revenues:
Net sales		100.0		100.0		100.0		100.0
Licensed department rentals and other income		0.5		0.4		0.4		0.4
		100.5		100.4		100.4		100.4
Costs and expenses:
Cost of sales		74.7		75.2		74.2		74.8
Gross margin		25.3		24.8		25.8		25.2
Selling, general and administrative expenses		21.8		20.6		21.6		20.6
Depreciation and amortization expenses		2.7		2.7		2.8		2.7
		24.5		23.3		24.4		23.3
Income from operations		1.3		1.9		1.9		2.3
Interest expense - net		1.1		1.7		1.3		1.7
Earnings before income taxes and accounting change		0.2		0.2		0.6		0.6
Provision for income taxes		0.1		0.1		0.2		0.2
Earnings before accounting change		0.1		0.1		0.3		0.4
		=======		======		=======		=======
ShopKo Stores, Inc. and Subsidiaries Business Segment Information Third Quarter and Year to Date
		13 Weeks		13 Weeks		39 Weeks		39 Weeks
		Ended		Ended		Ended		Ended
		November 1,		November 2,		November 1,		November 2,
(Dollars in thousands)		2003		2002		2003		2002
ShopKo Retail Segment
Net sales	$	568,492	$	584,099	$	1,657,829	$	1,719,852
Licensed department rentals and other income		3,120		3,036		8,743		8,659
		571,612		587,135		1,666,572		1,728,511
Costs and expenses:
Cost of sales		422,549		440,294		1,228,189		1,284,055
Gross Margin		145,943		143,805		429,640		435,797
Selling, general and administrative expenses		116,376		108,871		335,379		322,516
Depreciation and amortization expenses		14,809		14,736		44,455		45,019
		131,185		123,607		379,834		367,535
Income from operations	$	17,878	$	23,234	$	58,549	$	76,921
		========		=======		========		========
Pamida Retail Segment
Net sales	$	190,051	$	185,511	$	573,323	$	561,891
Licensed department rentals and other income		363		315		1,027		1,015
		190,414		185,826		574,350		562,906
Costs and expenses:
Cost of sales		144,190		138,413		426,764		422,393
Gross Margin		45,861		47,098		146,559		139,498
Selling, general and administrative expenses		43,990		42,940		128,785		124,085
Depreciation and amortization expenses		5,576		5,783		17,211		16,766
		49,566		48,723		145,996		140,851
Income from operations	$	(3,342)	$	(1,310)	$	1,590	$	(338)
		=========		========		=========		=========
Corporate Segment
Net sales	$	-	$	-	$	-	$	-
Licensed department rentals and other income		-		-		-		-
		-				-		-
Costs and expenses:
Selling, general and administrative expenses		4,799		6,988		17,933		22,712
Depreciation and amortization expenses		105		148		402		491
		4,904		7,136		18,335		23,203
Loss from operations	$	(4,904)	$	(7,136)	$	(18,335)	$	(23,203)
		=======		======		=======		=======
Consolidated
Income from operations	$	9,632	$	14,788	$	41,804	$	53,380
		=======		======		=======		=======
ShopKo Stores, Inc. and Subsidiaries Business Segment Information Percents of Sales Third Quarter and Year to Date
		13 Weeks		13 Weeks		39 Weeks		39 Weeks
		Ended		Ended		Ended		Ended
		November 1,		November 2,		November 1,		November 2,
		2003		2002		2003		2002
ShopKo Retail Segment
Net sales		100.0		100.0		100.0		100.0
Licensed department rentals and other income		0.5		0.5		0.5		0.5
		100.5		100.5		100.5		100.5
Costs and expenses:
Cost of sales		74.3		75.4		74.1		74.7
Gross Margin		25.7		24.6		25.9		25.3
Selling, general and administrative expenses		20.5		18.6		20.2		18.8
Depreciation and amortization expenses		2.6		2.5		2.7		2.6
		23.1		21.2		22.9		21.4
Income from operations		3.1		4.0		3.5		4.5
		=======		======		=======		=======
		13 Weeks		13 Weeks		39 Weeks		39 Weeks
		Ended		Ended		Ended		Ended
		November 1,		November 2,		November 1,		November 2,
		2003		2002		2003		2002
Pamida Retail Segment
Net sales		100.0		100.0		100.0		100.0
Licensed department rentals and other income		0.2		0.2		0.2		0.2
		100.2		100.2		100.2		100.2
Costs and expenses:
Cost of sales		75.9		74.6		74.4		75.2
Gross Margin		24.1		25.4		25.6		24.8
Selling, general and administrative expenses		23.1		23.1		22.5		22.1
Depreciation and amortization expenses		2.9		3.1		3.0		3.0
		26.0		26.3		25.5		25.1
Income from operations		(1.7)		(0.7)		0.3		(0.1)
		=======		======		=======		=======
Consolidated
Income from operations		1.3		1.9		1.9		2.3
		=======		======		=======		=======
ShopKo Stores, Inc. and Subsidiaries Consolidated Condensed Balance Sheet (In thousands
		November 1,		November 2,
		2003		2002
Cash and cash equivalents	$	58,453		35,069
Receivables, less allowances		49,195		53,560
Merchandise inventories		708,312		718,637
Other current assets		11,597		15,915
Total current assets		827,557		823,181
Other assets and deferred charges		12,087		10,897
Intangible assets		24,217		22,157
Net property and equipment		780,664		829,465
Total assets	$	1,644,525		1,685,700
		=========		=========
Short-term debt	$	205,048		79,511
Accounts payable - trade		326,242		335,349
Accrued liabilities		203,295		196,554
Current portion of long-term obligations		6,890		96,910
Total current liabilities		741,475		708,324
Long-term obligations		304,389		429,348
Other long-term obligations		15,793		3,365
Deferred income taxes		25,186		30,355
Shareholders' equity		557,682		514,308
Total liabilities and shareholders' equity	$	1,644,525		1,685,700
		=========		=========