-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, V2kevZ/fXo3dPAUzM510YD3WTeT/ewPs2Lv2+9L442oz3JueAajjT8I/w+nkq7Ui w1TmyuvyR7aXBp9HUjTTfw== 0000108721-96-000002.txt : 19960503 0000108721-96-000002.hdr.sgml : 19960503 ACCESSION NUMBER: 0000108721-96-000002 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960502 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: WYNNS INTERNATIONAL INC CENTRAL INDEX KEY: 0000108721 STANDARD INDUSTRIAL CLASSIFICATION: GASKETS, PACKAGING AND SEALING DEVICES & RUBBER & PLASTIC HOSE [3050] IRS NUMBER: 952854312 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-07200 FILM NUMBER: 96555008 BUSINESS ADDRESS: STREET 1: 500 NORTH STATE COLLEGE BLVD CITY: ORANGE STATE: CA ZIP: 92668 BUSINESS PHONE: 7149383700 MAIL ADDRESS: STREET 1: 500 NORTH STATE COLLEGE BLVD CITY: ORANGE STATE: CA ZIP: 92668 10-Q 1 FORM 10-Q DATED MARCH 31, 1996 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) [X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended March 31, 1996 or [ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from _________________ to _________________ Commission File No. 1-7200 Wynn's International, Inc. (Exact name of Registrant as specified in its charter) Delware 95-2854312 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 500 North State College Blvd., Ste. 700, Orange, CA 92668 (Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (714) 938-3700 _______________________________________________________________________________ Former name, former address & former fiscal year, if changed since last report. 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 [ ] At April 30, 1996, Registrant had 9,100,360 shares of common stock outstanding. WYNN'S INTERNATIONAL, INC. I N D E X ---------
Page No. -------- Part I - Financial Information Item 1 - Financial Statements: Consolidated Condensed Balance Sheets - March 31, 1996 (unaudited) and December 31, 1995 2 Unaudited Consolidated Condensed Statements of Income - Three Months Ended March 31, 1996 and 1995 3 Unaudited Consolidated Condensed Statements of Cash Flows - Three Months Ended March 31, 1996 and 1995 4 Notes to Unaudited Consolidated Condensed Financial Statements 5 Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations 6-8 Part II - Other Information Item 1 - Legal Proceedings 9 Item 6 - Exhibits and Reports on Form 8-K 10 Signatures 11 Exhibits Exhibit 11 - Computation of Net Income Per Common Share - Primary Exhibit 11 - Computation of Net Income Per Common Share - Assuming Full Dilution Exhibit 27 - Financial Data Schedule
WYNN'S INTERNATIONAL, INC. CONSOLIDATED CONDENSED BALANCE SHEETS (Dollars in Thousands, Except Per Share Amounts)
March 31 1996 December 31 (unaudited) 1995 ----------- ----------- ASSETS Current assets: Cash and cash equivalents $ 18,059 $ 23,127 Accounts receivable, less $1,389 allowance for doubtful accounts ($1,344 at December 31, 1995) 59,631 50,590 Inventories: Finished goods 22,399 22,074 Raw materials and work in process 15,811 15,771 -------- -------- 38,210 37,845 Prepaid expenses and other current assets (including deferred tax assets of $8,044 at March 31, 1996 and $7,442 at December 31, 1995) 16,349 15,140 -------- -------- Total current assets 132,249 126,702 Property, plant and equipment, at cost less accumulated depreciation and amortization 49,107 48,549 Other assets 6,444 6,514 -------- -------- $187,800 $181,765 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 21,333 $ 20,640 Dividends payable 3 789 Taxes based on income 3,447 2,289 Accrued liabilities 35,803 34,729 Long-term debt due within one year 90 91 -------- -------- Total current liabilities 60,676 58,538 Long-term debt due after one year 49 75 Deferred taxes based on income 6,948 6,919 Commitments and contingencies Stockholders' equity: Preferred stock, $1 par value; 500,000 shares authorized, none issued - - Common stock, $1 par value; 20,000,000 shares authorized, 9,614,523 shares issued (9,564,998 at December 31, 1995) 9,614 9,565 Capital in excess of par value 13,703 13,173 Retained earnings 102,469 98,619 Equity adjustment from foreign currency translation (1,807) (1,170) Unearned compensation (271) (373) Common stock held in treasury 520,875 shares, at cost (3,581) (3,581) -------- -------- Total stockholders' equity 120,127 116,233 -------- -------- $187,800 $181,765 ======== ========
See accompanying notes 2 WYNN'S INTERNATIONAL, INC. UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Dollars in Thousands, Except Per Share amounts)
Three Months Ended March 31 --------------------- 1996 1995 -------- -------- Revenues: Net sales $ 83,085 $ 78,074 Interest income 274 189 -------- -------- 83,359 78,263 -------- -------- Cost and expenses: Cost of sales 52,464 49,831 Selling, general & administrative 23,156 21,983 Interest expense 52 570 -------- -------- 75,672 72,384 -------- -------- Income before taxes based on income 7,687 5,879 Provision for taxes based on income 2,929 2,234 -------- -------- Net income $ 4,758 $ 3,645 ======== ======== Income per share of common stock: Primary $ .50 $ .42 ======== ======== Fully diluted $ .50 $ .40 ======== ======== Cash dividend per common share $ .10 $.0867 ======== ========
See accompanying notes 3 WYNN'S INTERNATIONAL, INC. UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Dollars in Thousands)
Three Months Ended March 31 ----------------------- 1996 1995 -------- -------- Cash flows from operating activities: Net income $ 4,758 $ 3,645 Adjustments to reconcile net income to net cash used in operating activities: Depreciation and amortization 2,120 1,970 Provision for uncollectible accounts 92 83 Amortization of stock compensation 102 102 Gain on sale of property, plant & equipment (13) (13) Benefit for deferred income taxes (381) (546) Changes in operating assets and liabilities: Accounts receivable (net) (9,133) (12,000) Inventories (750) (213) Prepaid expenses and other current assets (607) (911) Other assets (21) (107) Accounts payable 693 4,302 Product warranty program reserves 1,189 181 Taxes based on income 1,032 1,962 Accrued liabilities (115) (1,009) -------- -------- Net cash used in operating activities (1,034) (2,554) -------- -------- Cash flows from investing activities: Additions to property, plant and equipment (2,357) (2,144) Proceeds from sale of property, plant & equipment 44 234 Other - net - (37) -------- -------- Net cash used in investing activities (2,313) (1,947) -------- -------- Cash flows from financing activities: Borrowings under lines of credit - net - 1,826 Payments of long-term debt (27) (7,920) Dividends paid (1,694) (1,213) Proceeds from exercise of stock options 579 67 -------- -------- Net cash used in financing activities (1,142) (7,240) -------- -------- Effect of exchange rate changes (579) 1,183 -------- -------- Net decrease in cash and cash equivalents (5,068) (10,558) -------- -------- Cash and cash equivalents at beginning of year 23,127 16,446 -------- -------- Cash and cash equivalents at March 31 $ 18,059 $ 5,888 ======== ========
See accompanying notes 4 WYNN'S INTERNATIONAL, INC. NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS MARCH 31, 1996 AND 1995 1) The accompanying unaudited consolidated condensed financial statements include all adjustments which in the opinion of management are necessary to a fair presentation of the information for the interim period herein reported. These unaudited consolidated condensed financial statements should be read in conjunction with the consolidated financial statements included in the 1995 Annual Report to Stockholders. 2) The results of operations for the three months ended March 31, 1996 are not necessarily indicative of results of operations for the year ending December 31, 1996. Accounting measurements at interim dates inherently involve greater imprecision than at year-end, which is due, in part, to increased reliance on the use of estimates at interim dates. 3) Cash payments for interest and income taxes are as follows:
Three months ended March 31 --------------------------- 1996 1995 ---------- ---------- Interest $ 28,000 $1,187,000 Income taxes 2,278,000 818,000
In 1995, additional common stock was issued upon the conversion of $6,250,000 of long-term debt. 4) The number of shares used in the calculation of primary and fully diluted earnings per share information is as follows:
Three months ended March 31 --------------------------- 1996 1995 ---------- ---------- Primary 9,429,783 8,769,371 Fully diluted 9,471,973 9,209,117
The number of shares and the related earnings per share data for all periods have been adjusted retroactively to reflect the 3 for 2 stock split effected in December 1995. 5 WYNN'S INTERNATIONAL, INC. ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS - --------------------- Comparison of the three months ended March 31, 1996 and 1995 - ------------------------------------------------------------ Net sales for the first quarter of 1996 were $83.1 million, a 6% increase compared to $78.1 million in the first quarter of 1995. Sales of the Automotive Components Division, which is comprised of Wynn's-Precision, Inc. (Precision), a Lebanon, Tennessee-based supplier of O-rings, seals and molded rubber products, and Wynn's Climate Systems, Inc. (WCS), a Fort Worth, Texas-based supplier of automotive air conditioning products, remained approximately the same. Precision's revenues increased 2% in the first quarter of 1996 compared to the first quarter of 1995, reflecting higher sales volume at the Virginia, Arizona and Canadian operations, offset partially by lower sales volumes at the Tennessee operations. The reduction in sales at the Tennessee operation, which manufactures and sells primarily O-rings, was due to the decline in U.S. automotive production rates during the most recent quarter compared to the prior year. The increase in sales at the Virginia operation was due to growth in sales from the relatively new applications of its composite gasket product line. WCS experienced a small decrease in sales during the first quarter of 1996 compared to the first quarter of 1995. The revenue decline was attributable to decreased sales in its original equipment manufacturers ("OEM") division and lower sales to the U.S. aftermarket (including company-owned installation centers), partially offset by increased sales to WCS' European OEM customers. Sales at the Specialty Chemicals Division, principally car care products, increased 17% in the first quarter compared to the same quarter in 1995. Sales increased 35% in the U.S. compared to the prior year primarily due to higher sales of the division's product warranty programs and sales to direct export customers. Foreign subsidiary sales increased 6% from the prior year primarily due to higher sales from this Division's French, South African, U.K. and Canadian operations. Excluding the effect of foreign exchange rate fluctuations, total net sales of this Division would have increased 16% in the most recent quarter compared to the comparable quarter in 1995. Sales by the Builders Hardware Division, the relatively small regional builders hardware products wholesale distributor, increased 8% in the first quarter of 1996 compared to the first quarter of 1995. The consolidated cost of sales for the first quarter of 1996 was 63.1% of sales, an improvement from 63.8% in the first quarter of 1995. The increase in the consolidated gross margin percentage was due to the change in mix of revenues. The gross margin percentage increased at Precision due to the higher volumes at its Virginia operations, partially offset by lower volumes at Precision's Tennessee operations. The gross margin percentage remained unchanged at WCS. The gross margin percentage decreased at the Specialty Chemicals Division and the Builders Hardware Division due to a change in the sales mix. 6 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) - ------------------------------------------------- Selling, general and administrative expenses in the first quarter of 1996 were $23.2 million (27.9% of sales) compared to $22.0 million (28.2% of sales) for the first quarter of 1995. The increase in total selling, general and administrative expenses is primarily attributable to higher expenses at the Specialty Chemicals Division and Precision. The increase in selling, general and administrative expenses at the Specialty Chemicals Division reflects increased spending associated with higher revenues, but expenses declined as a percentage of sales. Operating expenses increased at Precision primarily due to higher personnel and related costs. Consolidated interest expense in the first quarter of 1996 declined compared to the first quarter of 1995 due to the elimination during 1995 of virtually all of the Company's interest-bearing debt. Income before taxes based on income increased 31% to $7.7 million in 1996 from $5.9 million in the first quarter of 1995. In the Automotive Components Division, Precision's operating profit increased slightly compared to the first quarter of 1995. WCS recorded a small operating profit in the first quarter of 1996, down slightly compared to the same period in 1995. The decline in operating profit was principally due to the lower sales. The Specialty Chemicals Division experienced a 46% increase in operating profit in the quarter ended March 31, 1996 due primarily to improved results at its U.S. and Western European based operations. The effective tax rate in the first quarter of 1996 was 38.1%, virtually unchanged from the 38.0% rate in the first quarter of 1995. Net income increased 31% to $4.8 million in the first quarter of 1996 compared to $3.6 million in the first quarter of 1995 as a result of the increase in pretax income. Primary income per share increased in the first quarter of 1996 to $.50 from $.42 in 1995 due to the higher net income. The number of shares used in the calculation of primary earnings per share increased 8% in 1996 due primarily to the conversion of convertible notes into 639,203 shares of the Company's common stock in March of 1995 and the exercise of stock options in 1995 and 1996. Fully diluted earnings per share increased 25% in 1996 compared to 1995 due to the increased net income. FINANCIAL CONDITION - ------------------- Working capital at the end of the first quarter was $71.6 million compared to $68.2 million at December 31, 1995. The current ratio was 2.18 to 1 at the end of the first quarter of this year compared to 2.16 to 1 at December 31, 1995. The Company has adequate cash and cash equivalents and lines of credit to meet foreseeable working capital requirements. Cash and cash equivalents were $18.1 million at March 31, 1996 compared to $23.1 million at December 31, 1995. The decrease in cash and cash equivalents was primarily due to the annual payment of employee incentive compensation, the funding of dividend payments and the increase in the Company's accounts receivable. Accounts receivable increased $9.0 million to $59.6 million at March 31, 1996 from $50.6 million at December 31, 1995. This increase was principally due to the higher sales at WCS, Precision and the Specialty Chemicals Division compared to the quarter 7 MANAGEMENT'S DISCUSSION AND ANLAYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) - ------------------------------------------------- ended December 31, 1995 and WCS' seasonal offering of extended terms to selected customers during the first quarter of the year. Inventories increased slightly to $38.2 million at the end of the first quarter of this year compared to $37.8 million at December 31, 1995. During the three months ended March 31, 1996, the Company purchased $2.4 million of new property, plant and equipment, primarily for the Automotive Components Division. The Company anticipates that in 1996 capital expenditures will be approximately $11 million. Stockholders' equity at March 31, 1996 was $120.1 million or $13.21 per share compared to $116.2 million or $12.85 per share at December 31, 1995. The increase of $3.9 million is attributable to net income of $4.8 million, $.5 million from common stock transactions and the amortization of $.1 million of unearned compensation, reduced by a $.6 million decrease in the foreign currency translation account and $.9 million of dividends declared. 8 PART II - OTHER INFORMATION WYNN'S INTERNATIONAL, INC. ITEM 1 - LEGAL PROCEEDINGS Various claims and actions, considered normal to the Company's business, have been asserted and are pending against the Company and its subsidiaries. The Company believes that such claims and actions should not have any material adverse effect upon the results of operations or the financial position of the Company based upon information presently known to the Company. 9 WYNN'S INTERNATIONAL, INC. ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits 11 - Computation of net income per common share - primary and assuming full dilution. 27 - Financial data schedule (b) Registrant has not filed any reports on Form 8-K during the quarter for which this report is filed. 10 WYNN'S INTERNATIONAL, INC. SIGNATURES 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. WYNN'S INTERNATIONAL, INC. ------------------------------------------ (Registrant) Date May 1, 1996 James Carroll ------------------- -------------------------------------------- James Carroll President and Chief Executive Officer Date May 1, 1996 Seymour A. Schlosser ------------------- -------------------------------------------- Seymour A. Schlosser Vice President-Finance (Principal Financial and Accounting Officer) 11 EX-11 2 EXHIBIT 11 - COMPUTATION OF NET INCOME PER COMMON SHARE Exhibit 11 WYNN'S INTERNATIONAL, INC. COMPUTATION OF NET INCOME PER COMMON SHARE - PRIMARY (Dollars in Thousands Except Per Share Amounts)
Three Months Ended March 31 ------------------------ 1996 1995 --------- --------- Net income $ 4,758 $ 3,645 ========= ========= Weighted average number of shares issued 9,080,230 8,577,315 Net shares assumed issued using the treasury stock method for stock options outstanding during each period based on average market price 349,553 192,056 --------- --------- Common and common equivalent shares 9,429,783 8,769,371 ========= ========= Income per common share $ .50 $ .42 ========= ========= COMPUTATION OF NET INCOME PER COMMON SHARE - ASSUMING FULL DILUTION (DOLLARS IN THOUSANDS EXCEPT PER SHARE AMOUNTS) Three Months Ended March 31 ------------------------ 1996 1995 --------- --------- Net income $ 4,758 $ 3,645 Net interest expense from convertible notes - 59 --------- --------- Adjusted net income $ 4,758 $ 3,704 ========= ========= Weighted average number of shares issued 9,080,230 8,577,315 Net shares assumed issued using the treasury stock method for stock options outstanding during each period based on average or ending market price, whichever is higher 391,743 212,770 Dilutive effect of assumed conversion of notes outstanding - 419,032 --------- --------- Fully diluted shares 9,471,973 9,209,117 ========= ========= Income per common share $ .50 $ .40 ========= =========
EX-27 3 EXHIBIT 27 - FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FINANCIAL STATEMENTS CONTAINED IN FORM 10-Q FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 3-MOS DEC-31-1996 MAR-31-1996 18,059 0 61,020 1,389 38,210 132,249 49,107 0 187,800 60,676 49 0 0 9,614 110,513 187,800 83,085 83,359 52,464 52,464 23,064 92 52 7,687 2,929 4,758 0 0 0 4,758 .50 .50 Property, Plant and Equipment, At Cost Less Accumulated Depreciation and Amortization
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