-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, IA9VlvhQCEewRsfcPPvAs+o0zMDvILfVX9S2UnqNGpYBLZPokuc5V601WrhW1tqj 77IH7RJGyxXj/Vn9UxRKsw== 0000101063-95-000027.txt : 19950814 0000101063-95-000027.hdr.sgml : 19950814 ACCESSION NUMBER: 0000101063-95-000027 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19950630 FILED AS OF DATE: 19950811 SROS: AMEX SROS: BSE SROS: NYSE SROS: PSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHIQUITA BRANDS INTERNATIONAL INC CENTRAL INDEX KEY: 0000101063 STANDARD INDUSTRIAL CLASSIFICATION: MEAT PACKING PLANTS [2011] IRS NUMBER: 041923360 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-01550 FILM NUMBER: 95561472 BUSINESS ADDRESS: STREET 1: 250 E FIFTH ST CITY: CINCINNATI STATE: OH ZIP: 45202 BUSINESS PHONE: 5137848011 FORMER COMPANY: FORMER CONFORMED NAME: UNITED BRANDS CO DATE OF NAME CHANGE: 19900403 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarterly Period Ended Commission File June 30, 1995 Number 1-1550 CHIQUITA BRANDS INTERNATIONAL, INC. Incorporated under the IRS Employer I.D. Laws of New Jersey No. 04-1923360 250 East Fifth Street, Cincinnati, Ohio 45202 (513) 784-8011 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, and (2) has been subject to such filing requirements for the past 90 days. YES X NO As of August 1, 1995, there were 50,369,567 shares of Common Stock outstanding. Page 1 of 12 Pages CHIQUITA BRANDS INTERNATIONAL, INC. TABLE OF CONTENTS Page PART I - Financial Information Consolidated Statement of Income for the quarters and six months ended June 30, 1995 and 1994 . . . . . . 3 Consolidated Balance Sheet as of June 30, 1995, December 31, 1994 and June 30, 1994 . . . . . . . . 4 Consolidated Statement of Cash Flow for the six months ended June 30, 1995 and 1994 . . . . . . . . . . . 5 Notes to Consolidated Financial Statements . . . . . 6 Management's Analysis of Operations and Financial Condition . . . . . . . . . . . . . . . . 7 PART II - Other Information Item 1 - Legal Proceedings . . . . . . . . . . . . . 8 Item 4 - Submission of Matters to a Vote of Security Holders . . . . . . . . . . . . . . . . . 8 Item 6 - Exhibits and Reports on Form 8-K . . . . . . 9 Signature . . . . . . . . . . . . . . . . . . . . . . . . 10 Part I - Financial Information CHIQUITA BRANDS INTERNATIONAL, INC. CONSOLIDATED STATEMENT OF INCOME (Unaudited) (In thousands, except per share amounts)
Quarter Ended June 30, Six Months Ended June 30, 1995 1994 1995 1994 --------- --------- --------- --------- Net sales $ 1,086,072 $1,007,121 $ 2,114,435 $ 2,063,368 Operating expenses Cost of sales 876,985 793,517 1,698,236 1,634,473 Selling, general and administrative 110,130 114,337 210,282 219,216 Depreciation 26,511 28,766 53,044 57,193 --------- --------- --------- --------- 1,013,626 936,620 1,961,562 1,910,882 --------- --------- --------- --------- Operating income 72,446 70,501 152,873 152,486 Interest income 8,541 5,571 15,349 10,741 Interest expense (41,806) (41,357) (83,534) (85,627) Other income, net 549 1,730 970 2,379 --------- --------- --------- --------- Income before income taxes and extraordinary item 39,730 36,445 85,658 79,979 Income taxes (5,600) (5,500) (13,900) (13,500) --------- --------- --------- --------- Income before extraordinary item 34,130 30,945 71,758 66,479 Extraordinary loss from refinancing of debt (4,713) -- (4,713) (22,840) --------- --------- --------- --------- Net income $ 29,417 $ 30,945 $ 67,045 $ 43,639 ========= ========= ========= ========= Weighted average number of common shares outstanding (see Exhibit 11) 53,907 53,011 53,694 53,094 ========= ========= ========= ========= Earnings (loss) per common share: Primary - Income before extraordinary item $ .59 $ .54 $ 1.26 $ 1.19 - Extraordinary item (.08) -- (.09) (.43) - Net income $ .51 $ .54 $ 1.17 $ .76 Fully - Income before diluted extraordinary item $ .55 $ .51 $ 1.17 $ 1.13 - Extraordinary item (.07) -- (.08) (.39) - Net income $ .48 $ .51 $ 1.09 $ .74 Dividends per common share $ .05 $ .05 $ .10 $ .10
See Notes to Consolidated Financial Statements. CHIQUITA BRANDS INTERNATIONAL, INC. CONSOLIDATED BALANCE SHEET (Unaudited) (In thousands, except share amounts)
June 30, December 31, June 30, 1995 1994 1994 --------- --------- --------- ASSETS Current assets Cash and equivalents $ 227,787 $ 178,855 $ 269,159 Trade receivables (less allowances of $15,860, $14,149 and $13,086) 302,030 257,777 294,837 Other receivables, net 94,310 95,948 98,448 Inventories 341,006 351,730 340,313 Other current assets 34,505 33,932 29,319 --------- --------- --------- Total current assets 999,638 918,242 1,032,076 Restricted cash 77,530 75,030 52,520 Property, plant and equipment, net 1,390,510 1,433,858 1,486,945 Investments and other assets 333,645 309,721 304,627 Intangibles, net 161,930 165,170 170,640 Total assets $ 2,963,253 $2,902,021 $ 3,046,808 ========= ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Notes and loans payable $ 120,821 $ 130,163 $ 129,624 Long-term debt due within one year 76,700 91,032 83,882 Accounts payable 284,902 270,033 256,879 Accrued liabilities 161,383 162,589 148,668 Total current liabilities 643,806 653,817 619,053 Long-term debt of parent company 840,644 840,377 840,125 Long-term debt of subsidiaries 533,062 524,500 550,083 Accrued pension and other employee benefits 121,972 120,325 130,799 Other liabilities 115,230 118,193 145,147 Total liabilities 2,254,714 2,257,212 2,285,207 --------- --------- --------- Shareholders' equity Preferred and preference stock 190,639 190,639 190,639 Capital stock, $.33 par value (50,384,019, 49,300,881 and 48,779,465 shares) 16,795 16,434 16,260 Capital surplus 513,398 505,800 499,225 Retained earnings (deficit) 2,831 (52,940) 73,406 Minimum pension liability adjustment (15,124) (15,124) (17,929) --------- --------- --------- Total shareholders' equity 708,539 644,809 761,601 Total liabilities and shareholders' equity $ 2,963,253 $2,902,021 $ 3,046,808 ========= ========= =========
See Notes to Consolidated Financial Statements. CHIQUITA BRANDS INTERNATIONAL, INC. CONSOLIDATED STATEMENT OF CASH FLOW (Unaudited) (In thousands)
Six Months Ended June 30, 1995 1994 --------- --------- Cash provided (used) by: Operations Income before extraordinary item $ 71,758 $ 66,479 Depreciation and amortization 56,072 60,557 Changes in current assets and liabilities (32,280) (39,061) Other 323 (2,009) -------- --------- Cash flow from operations 95,873 85,966 --------- --------- Investing Capital expenditures (34,801) (71,471) Restricted cash deposits (2,500) (1,500) Proceeds from sale of containers 6,830 -- Proceeds from sales of businesses 5,378 52,700 Other 1,217 (2,297) --------- --------- Cash flow from investing (23,876) (22,568) --------- --------- Financing Debt transactions Issuances of long-term debt 196,697 212,662 Repayments of long-term debt (209,142) (284,573) Decrease in notes and loans payable (2,420) (7,447) Stock transactions Issuance of preferred stock -- 138,369 Issuances of capital stock 942 2,943 Dividends (9,142) (7,419) --------- --------- Cash flow from financing (23,065) 54,535 --------- --------- Increase in cash and equivalents 48,932 117,933 Balance at beginning of period 178,855 151,226 --------- --------- Balance at end of period $ 227,787 $ 269,159 ========= =========
See Notes to Consolidated Financial Statements. CHIQUITA BRANDS INTERNATIONAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Interim results are subject to significant seasonal variations and are not necessarily indicative of the results of operations for a full fiscal year. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary for a fair statement of the results of the interim periods shown have been made. See Notes to Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 1994 for additional information relating to the Company's financial statements. Inventories consist of the following (in thousands):
June 30, December 31, June 30, 1995 1994 1994 ----------- ------------- ------------ Bananas and other fresh produce $ 36,767 $ 47,592 $ 43,374 Meat 43,928 35,165 43,752 Other food products 46,711 63,565 40,296 Growing crops 115,730 115,177 120,002 Materials and supplies 83,054 76,078 79,968 Other 14,816 14,153 12,921 --------- --------- --------- $ 341,006 $ 351,730 $ 340,313 ========= ========= =========
During the second quarter of 1995, the Company replaced $153 million of ship loans with loans having longer maturities totaling $187 million resulting in an extraordinary loss of $4.7 million. The Company also negotiated an extension of the maturities on another $23 million ship loan. In the first quarter of 1994, the Company completed the sale of $175 million principal amount of 9-1/8% Senior Notes due 2004 and 2,875,000 shares of $2.875 Non-Voting Cumulative Preferred Stock, Series A. Most of the net proceeds from the offerings were used to prepay higher rate subordinated debentures. These refinancings resulted in an extraordinary loss of $22.8 million. In accordance with its long-standing policy to periodically hedge transactions denominated in foreign currencies, at June 30, 1995, the Company had foreign exchange forward contracts to ensure conversion of approximately $150 million of foreign sales commitments for the remainder of 1995 at an average exchange rate of 1.52 Deutsche marks per dollar. The fair value of these contracts, based on quoted market prices, was approximately $16 million. The Company also had option contracts which ensure conversion through 1996 of approximately $130 million of foreign sales at a rate not higher than 1.45 Deutsche marks per dollar and approximately $120 million of foreign sales at a rate not higher than 1.43 Deutsche marks per dollar or lower than 1.29 Deutsche marks per dollar. The fair value of the option contracts, based on quoted market prices, was not significant. CHIQUITA BRANDS INTERNATIONAL, INC. MANAGEMENT'S ANALYSIS OF OPERATIONS AND FINANCIAL CONDITION OPERATIONS Net sales for the quarter ended June 30, 1995 increased 7.8% from the same quarter last year primarily as a result of higher prices for fresh fruit. Net sales for the first half of 1995 increased 2.5% from the prior year level primarily as a result of these higher prices, partially offset by a 2.6% decrease in sales for the first quarter of 1995 as a result of the sale of the Company's specialty meat operations during the prior year first quarter. Operating income for the quarter and six months was $72.4 million and $152.9 million in 1995 compared to $70.5 million and $152.5 million in 1994, with lower earnings from the sale of bananas offset by improved earnings from other food products within the Chiquita operations segment. Higher banana operating costs, including the impact of higher paper prices, implementation of the banana Framework Agreement between the European Union, Colombia and Costa Rica, and reduced first quarter Honduran production, offset the benefit of a higher average worldwide banana price. Although improved, second quarter and first half operating income for the Company's Meat Division held for sale was not significant in either 1995 or 1994. Net interest expense for the quarter and first half decreased from the prior year as a result of a higher average yield earned on invested cash balances during 1995 and debt refinancing and reduction activities since the beginning of 1994. The Company's effective tax rate is affected by the level and mix of income between various domestic and foreign jurisdictions in which the Company operates. FINANCIAL CONDITION The $49 million increase in cash and equivalents during the first half of 1995 resulted primarily from operating cash flow. Cash used for capital expenditures was $35 million and proceeds from the sales of container equipment and the Company's New Zealand fresh produce distribution business amounted to $12 million. Part II - Other Information Item 1 - Legal Proceedings Reference is made to (a) Part I, Item 1 - "Business-Meat Division Held for Sale-Labor relations" in the Company's 1994 Form 10-K, (b) Note 2 to the Company's Consolidated Financial Statements included in the Company's 1994 Annual Report to Shareholders and (c) Part II, Item 1 - "Legal Proceedings" in the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 1995 and the discussion of the case concerning medical benefits for retired hourly employees. In June 1995, the United States Supreme Court denied the union's request for a review of the matter and, therefore, the lower court decisions in favor of Morrell stand. Reference is made to Part I, Item 3 - "Legal Proceedings" in the Company's 1994 Form 10-K and the discussion of the cases pending in U.S. District Courts in Texas alleging injuries as a result of exposure to DBCP, an agricultural chemical. In all of the cases, motions have been filed by defendants for dismissal of the cases from U.S. federal court to a more appropriate forum in the foreign countries where the plaintiffs reside. Concurrently, the plaintiffs filed motions to remand the cases to Texas state court. In July 1995, two of the cases were remanded to Texas state court while the remaining cases were dismissed in favor of actions in the plaintiffs' home countries (subject to various conditions, including the defendants submitting to jurisdiction in the plaintiffs' home countries). The Company continues to vigorously defend itself in these cases. Item 4 - Submission of Matters to a Vote of Security Holders In connection with the election of eight directors of the Company, proxies were solicited pursuant to Regulation 14 under the Securities Exchange Act of 1934 and the following votes were made at the Company's Annual Meeting of Shareholders held on May 10, 1995:
Name Votes For Votes Withheld Carl H. Lindner 44,910,167 584,733 Keith E. Lindner 44,969,764 525,136 S. Craig Lindner 44,931,184 563,716 Fred J. Runk 44,942,667 552,233 Jean Head Sisco 44,963,580 531,320 William W. Verity 44,948,222 546,678 Oliver W. Waddell 44,990,468 504,432 Ronald F. Walker 44,955,734 539,166
Proxies representing 7,972,068 shares were not voted. Item 6 - Exhibits and Reports on Form 8-K Page Numbers (a) Exhibit 11 - Computation of Earnings Per Common Share . . . . . . . . . . . . . . . 11-12 Exhibit 27 - Financial Data Schedule . . . ** ** Copy omitted from this Quarterly Report on Form 10-Q. Copy included in report filed electronically with the Securities and Exchange Commission. (b) The following report on Form 8-K was filed during the quarter ended June 30, 1995: April 27, 1995 -to report the Company's announcement of results of operations for the quarter ended March 31, 1995. 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 thereunto duly authorized. CHIQUITA BRANDS INTERNATIONAL, INC. By: /s/ William A. Tsacalis William A. Tsacalis Vice President and Controller (Chief Accounting Officer) August 11, 1995 EX-11 2 Exhibit 11 CHIQUITA BRANDS INTERNATIONAL, INC. COMPUTATION OF EARNINGS PER COMMON SHARE (Unaudited) (In thousands, except per share amounts)
Quarter Ended Six Months Ended June 30, June 30, 1995 1994 1995 1994 --------- --------- --------- --------- A. Primary earnings (loss) per common share Income used to calculate primary earnings (loss) per common share: Income before extraordinary item $ 34,130 $ 30,945 $ 71,758 $ 66,479 Dividends on Series A Preferred Stock (2,066) (2,066) (4,133) (3,100) --------- --------- --------- --------- Income available to common shares before extraordinary item 32,064 28,879 67,625 63,379 Extraordinary loss from refinancing of debt (4,713) -- (4,713) (22,840) --------- --------- --------- --------- Net income available to common shares $ 27,351 $ 28,879 $ 62,912 $ 40,539 ========= ========= ========= ========= Shares used to calculate primary earnings (loss) per common share: Weighted average common and equivalent Series C preference shares outstanding 53,512 51,956 53,279 51,882 Less restricted common shares (419) -- (405) -- Dilutive effect of assumed exercise of stock options and warrants 814 1,055 820 1,212 --------- --------- --------- --------- 53,907 53,011 53,694 53,094 ========= ========= ========= ========= Primary earnings (loss) per common share: Income before extraordinary item $ .59 $ .54 $ 1.26 $ 1.19 Extraordinary item (.08) -- (.09) (.43) --------- --------- --------- --------- Net income $ .51 $ .54 $ 1.17 $ .76 ========= ========= ========= ========= /TABLE Exhibit 11 (continued) CHIQUITA BRANDS INTERNATIONAL, INC. COMPUTATION OF EARNINGS PER COMMON SHARE (Unaudited) (In thousands, except per share amounts)
Six Months Ended June 30, June 30, 1995 1994 1995 1994 --------- --------- --------- --------- B. Fully diluted earnings (loss) per common share Income used to calculate fully diluted earnings (loss) per common share: Income before extraordinary item $ 34,130 $ 30,945 $ 71,758 $ 66,479 Extraordinary loss from refinancing of debt (4,713) -- (4,713) (22,840) --------- --------- --------- --------- Net income $ 29,417 $ 30,945 $ 67,045 $ 43,639 ========= ========= ========= ========= Shares used to calculate fully diluted earnings (loss) per common share: Weighted average common and equivalent Series C preference shares outstanding 53,512 51,956 53,279 51,882 Less restricted common shares (399) -- (384) -- Dilutive effect of assumed exercise of stock options and warrants 1,036 1,055 938 1,382 Dilutive effect of assumed conversion of Series A Preferred Stock 7,566 7,566 7,566 5,675 --------- --------- --------- --------- 61,715 60,577 61,399 58,939 ========= ========= ========= ========= Fully diluted earnings (loss) per common share: Income before extraordinary item $ .55 $ .51 $ 1.17 $ 1.13 Extraordinary item (.07) -- (.08) (.39) --------- --------- --------- --------- Net income $ .48 $ .51 $ 1.09 $ .74 ========= ========= ========= ========= /TABLE EX-27 3
5 The schedule contains summary financial information extracted from the Chiquita Brands International, Inc. Form 10-Q for the quarterly period ended June 30, 1995 and is qualified in its entirety by reference to such financial statements. 1,000 6-MOS DEC-31-1995 JUN-30-1995 227,787 0 317,890 15,860 341,006 999,638 2,066,110 675,600 2,963,253 643,806 1,373,706 16,795 0 190,639 501,105 2,963,253 2,114,435 2,114,435 1,698,236 1,698,236 53,044 0 83,534 85,658 13,900 71,758 0 (4,713) 0 67,045 1.17 1.09 Amounts include an extraordinary loss of $.09 per share ($.08 per share fully diluted) resulting from refinancing of debt in the second quarter.
-----END PRIVACY-ENHANCED MESSAGE-----