-----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, LNYpSrPmSucy1zqiPeIqEYm4ZjsewE6P36NU6kG1GCsqU41JbrUxP8b4PtjxQ3sK DB5pPukn/0LUu4jTD/q/jA== 0000912057-95-006343.txt : 19950814 0000912057-95-006343.hdr.sgml : 19950814 ACCESSION NUMBER: 0000912057-95-006343 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19950630 FILED AS OF DATE: 19950811 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: BEMIS CO INC CENTRAL INDEX KEY: 0000011199 STANDARD INDUSTRIAL CLASSIFICATION: CONVERTED PAPER & PAPERBOARD PRODS (NO CONTAINERS/BOXES) [2670] IRS NUMBER: 430178130 STATE OF INCORPORATION: MO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-05277 FILM NUMBER: 95561837 BUSINESS ADDRESS: STREET 1: 222 S 9TH ST STE 2300 CITY: MINNEAPOLIS STATE: MN ZIP: 55402-4099 BUSINESS PHONE: 6123763000 MAIL ADDRESS: STREET 2: 222 S 9TH STREET SUITE 2300 CITY: MINNEAPOLIS STATE: MN ZIP: 55402-4099 10-Q 1 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OF THE SECURITIES EXCHANGE ACT OF 1934 For the Six Months Ended June 30, 1995 Commission File Number 1-5277 BEMIS COMPANY, INC. (Exact name of registrant as specified in its charter) Missouri 43-0178130 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 222 South 9th Street, Suite 2300 Minneapolis, Minnesota 55402-4099 (Address of principal executive offices) (Zip Code) Registrant's telephone number including area code (612) 376-3000 Indicate by check mark whether the registrant has filed all reports required to be filed by Section 13 of the Securities Exchange Act of 1934 during the preceding 12 months and has been subject to such filing requirements for the past 90 days. YES X NO ------- ------- Indicate the number of shares outstanding of each of the issurer's classes of common stock, as of the latest practicable date. 51,490,961 shares of Common Stock, $.10 par value on July 28, 1995 PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS The financial statements (enclosed as Exhibit 19) are incorporated by reference in this Form 10-Q. In the opinion of management, the financial statements reflect all adjustments necessary to a fair statement of the results for the six months ended June 30, 1995. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS - SECOND QUARTER 1995 Net Sales for the second quarter of 1995 were $383.2 million compared to $337.7 million for the second quarter of 1994, an increase of 13.5% or $45.5 million. Net Income was $21.1 million for the second quarter of 1995 and $18.7 million for the same quarter in 1994. Both the Flexible Packaging and the Specialty Coated and Graphics Products Lines of Business had increases in Sales and Operating Profits over the second quarter of 1994 as well as the first quarter of 1995. Overall, the level of business activity is less robust then it was late last year and early this year, but we continue to successfully penetrate new accounts and strengthen our competitive position in the marketplace. Addressing the Statement of Income line item changes of consequence. Cost of Products sold increased 14.2% compared to Net Sales increases of 13.5%. Sales price increases effected in 1994 and lower manufacturing overhead compared to 1994 have improved gross margins over the first quarter of 1995. However, to date we have not fully offset the full impact of multiple raw material price increases incurred during 1994. While raw material costs continued to rise in the first half of 1995, the rate of increases has been less severe than in 1994. Selling, General, and Administrative Expenses were 11.3% of Net Sales for the current quarter compared to 11.7% in the second quarter of 1994 on a 13.5% increase in Net Sales, reflecting cost control efforts and economies available through increasing volume. Lower Research and Development expenditures resulted from reduced product development expense in our Pressure-Sensitive Materials and Packaging Machinery business segments. Increasing interest rates account for the $.8 million rise in Interest Expense compared to the second quarter of 1994. - 2 - PART I - FINANCIAL INFORMATION Other Income decreased $.1 million largely due to an increase in currency exchange losses experienced in the second quarter of 1995 versus the second quarter of 1994. Minority Interest increases reflect improvements in our Pressure-Sensitive Materials business segment. Income Tax expense increased $1.3 million or 11.4%. The effective tax rate for the second quarter of 1995 and 1994 was 37.5% and 37.9%, respectively. RESULTS OF OPERATIONS - SIX MONTHS ENDED JUNE 30, 1995 Net Sales for the six-month period of 1995 were $751.7 million compared to $661.0 million for the same period in 1994, an increase of 13.7%. Net Income was $37.2 million for 1995 compared to $32.3 million for the same six-month period in 1994, an increase of 15.2%. Cost of Products sold increased 15.0% compared to Net Sales increases of 13.7%. Multiple raw material price increases experienced during 1994 and 1995 have not been fully offset by our own selling price increases. Reduced Research and Development expenditures occurred principally in our Packaging Machinery business segment. Increasing interest rates and a higher average debt level, required to sustain increased working capital and our capital equipment expenditure program, account for the $2.2 million rise in Interest Expense. Other Income increased $.3 million due to reduced currency exchange losses experienced in the first half of 1995 compared to the same period in 1994. The increase in Minority Interest reflects the continuing improvements in our Pressure-Sensitive Materials business segment. In the third quarter of 1993, a restructuring plan was announced for our Flexible Packaging Products line of business. The objective of this plan was to increase profitability through improved operating efficiency. This plan resulted in a $21 million pretax charge to Other Costs in the third quarter of 1993 and was expected to produce annual pretax savings of $8 million when fully implemented. Key aspects of the plan included redeployment of assets in both the domestic and international packaging machinery businesses ($7.2 million), the closedown of a U.S. nylon resin production facility ($6.2 million), the consolidation of two paper packaging plants into larger facilities ($5.0 million), and $2.6 million for all other expenses principally related to the write-off of nonproductive assets in the coated and laminated film business. All facility closures and consolidations were essentially completed as of the end of 1994 with the balance completed in the first half of 1995. The remaining minor sublease and severance payments are contractual in nature and have been accrued. We consider the restructuring effort to be completed. - 3 - PART I - FINANCIAL INFORMATION Of the $21 million estimated restructuring expense, we expected $11.4 million of non-cash cost and $9.6 million of net cash expense, all of which would be internally generated. Actual cash cost was $5.6 million and total non- cash cost was $15.3 million. The remaining $.1 million reserve has been restored to income in June 1995, since this project is complete. On July 5, 1995, we completed the placement of $100 million of 6.7% Notes Due July 1, 2005. The total proceeds were used to repay outstanding Commercial Paper. These debt securities are part of the $200 million registration filed with the Securities and Exchange Commission on Form S-3 on June 15, 1995. FINANCIAL CONDITION A statement of cash flow for the six months ended June 30, 1995, is as follows:
Millions -------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income. . . . . . . . . . . . . . . . . . . . . . . . . $ 37.2 Non-cash items: Depreciation and amortization . . . . . . . . . . . . . 29.8 Minority interest . . . . . . . . . . . . . . . . . . . 2.1 Deferred income taxes, non-current portion. . . . . . . 2.4 Net increase in working capital items . . . . . . . . . (12.1) Net change in deferred charges and credits. . . . . . . 1.7 Other. . . . . . . . . . . . . . . . . . . . . . . . . 0.5 ------- Net cash provided by operating activities . . . . . . . . . 61.6 ------- Cash flows from investing activities: Additions to property and equipment . . . . . . . . . . . . (48.1) Proceeds from sale of property and equipment. . . . . . . . 1.7 ------- Net cash used in investing activities. . . . . . . . . . . . . (46.4) ------- Cash flows from financing activities: Change in long-term debt. . . . . . . . . . . . . . . . . . (0.2) Change in short-term debt . . . . . . . . . . . . . . . . . (0.6) Cash dividends paid . . . . . . . . . . . . . . . . . . . . (16.5) Stock incentive programs. . . . . . . . . . . . . . . . . . 3.5 ------- Net cash provided by financing activities. . . . . . . . . . . (13.8) ------- Effect of exchange rates . . . . . . . . . . . . . . . . . . . 2.0 ------- Net increase in cash . . . . . . . . . . . . . . . . . . . . . $ 3.4 ------- -------
- 4 - PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS There have been no significant changes during the six months ended June 30, 1995. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K EXHIBITS (a) The following documents are filed as part of this report: 3(a) Articles of Incorporation of the Registrant, as amended. (1) 3(b) By-Laws of the Registrant, as amended.(4) 4(a) Rights Agreement, dated as of August 3, 1989, between Bemis Company, Inc. and Norwest Bank Minnesota, National Association. (2) 4(b) Form of Indenture dated as of June 15, 1995, between the Registrant and First Trust National Association, as Trustee. (5) 10(a) Bemis Company, Inc. 1987 Stock Option Plan. *(1) 10(b) Bemis Company, Inc. 1994 Stock Incentive Plan. *(3) 10(c) Bemis Company, Inc. 1984 Stock Award Plan.*(4) 10(d) Bemis Retirement Plan, as amended effective January 1, 1994.*(4) 10(e) Bemis Company, Inc. Supplemental Retirement Plan dated October 20, 1988.*(4) 10(f) Bemis Executive Incentive Plan dated April 1, 1990.*(4) 10(g) Bemis Company, Inc. Long Term Deferred Compensation Plan.*(4) 10(h) Amended and Restated Credit Agreement among Bemis Company, Inc., the Banks Listed therein and Morgan Guaranty Trust Company of New York, as Agent, originally dated as of August 1, 1986, Amended and Restated as of August 1, 1991, as amended by amendment No. 1 dated as of May 1, 1992, as amended by Amendment No. 2 dated December 1, 1992, as amended by Amendment No. 3 dated January 22, 1993, as amended by Amendment No. 4 dated March 15, 1994, as amended by Amendment No. 5 dated June 1, 1994; and as amended by Amendment No. 6 dated February 1, 1995. (4) 10(i) Form of Underwriting Agreement dated June 28, 1995. (5) 19 Financial Statements Furnished to Security Holders. 27 Financial Data Schedule (EDGAR electronic filing only). - 5 - PART II - OTHER INFORMATION (b) A Form 8-K was filed June 30, 1995, reporting the following: On June 28, 1995, the Registrant agreed to sell $100,000,000 principal amount of its 6.70% Notes Due 2005 (the "Notes"), pursuant to the Underwriting Agreement dated June 28, 1995, among the Registrant, Goldman, Sachs & Co. and J. P. Morgan Securities, Inc. The Notes are the subject of a Registrant Statement on Form S-3 (File No. 33-60253) filed by the Registrant with the Securities and Exchange Commission. _____________ *Management contract, compensatory plan or arrangement filed pursuant to Rule 601(b)(10)(iii)(A) of Regulation S-K under the Securities Exchange Act of 1934. (1) Incorporated by reference to the Registrant's Registration Statement on Form S-8 (File No. 33-50560). (2) Incorporated by reference to the Registrant's Registration Statement on Form 8-A dated August 4, 1989 (File No. 0-1387). (3) Incorporated by reference to the Registrant's Registration Statement on Form S-8 (File No. 33-80666). (4) Incorporated by reference to the Registrant's Annual Report on Form 10-K/A for the year ended December 31, 1994 (File No. 1-5277). (5) Incorporated by reference to the Registrant's Current Report on Form 8-K dated June 30, 1995 (File No. 1-5277). 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. BEMIS COMPANY, INC. Date August 10, 1995 S\ LeRoy F. Bazany ----------------- ----------------------------------- LeRoy F. Bazany, Vice President and Controller Date August 10, 1995 S\ B. R. Field, III ----------------- ----------------------------------- Benjamin R. Field, III, Senior Vice President, Chief Financial Officer and Treasurer - 6 - EX-19 2 EXHIBIT 19 EXHIBIT 19 - FINANCIAL STATEMENTS FURNISHED TO SECURITY HOLDERS BEMIS COMPANY, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF INCOME (IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
Three Months Ended Six Months Ended June 30 June 30 ------------------ -------------------- 1995 1994 1995 1994 ---- ---- ---- ---- Net sales. . . . . . . . . . . . . . . . . . . . . $383,180 $337,744 $751,731 $661,021 Costs and expenses: Cost of products sold . . . . . . . . . . . . . 299,650 262,300 590,342 513,278 Selling, general and administrative expenses . . . . . . . . . . . 43,232 39,471 88,565 83,965 Research and development. . . . . . . . . . . . 2,851 3,451 6,108 7,249 Interest expense. . . . . . . . . . . . . . . . 2,738 1,916 5,767 3,532 Other (income). . . . . . . . . . . . . . . . . (265) (344) (803) (543) Minority interest in net income . . . . . . . . 1,144 866 2,132 1,468 -------- -------- -------- -------- Income before income taxes . . . . . . . . . . . 33,830 30,084 59,620 52,072 Taxes based on income - cash. . . . . . . . . 12,404 10,866 19,992 18,828 Taxes based on income - deferred. . . . . . . 296 534 2,408 972 -------- -------- -------- -------- Net income . . . . . . . . . . . . . . . . . . . . $ 21,130 $ 18,684 $ 37,220 $ 32,272 -------- -------- -------- -------- -------- -------- -------- -------- Earnings per share of common stock . . . . . . . . $.41 $ .36 $.72 $.62 ---- ----- ---- ---- ---- ----- ---- ---- Cash dividends paid. . . . . . . . . . . . . . . . $.16 $.135 $.32 $.27 ---- ----- ---- ---- ---- ----- ---- ---- Average common shares and common stock equivalents outstanding . . . . . . . . . 52,018 51,941 51,948 51,916 -------- -------- -------- -------- -------- -------- -------- --------
EXHIBIT 19 - FINANCIAL STATEMENTS FURNISHED TO SECURITY HOLDERS BEMIS COMPANY, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (IN THOUSANDS OF DOLLARS)
Jun 30 Dec 31 ASSETS 1995 1994 ---- ---- Cash . . . . . . . . . . . . . . . . . . . . . . . . . $ 16,137 $ 12,726 Accounts receivable - net. . . . . . . . . . . . . . . 202,210 197,164 Inventories. . . . . . . . . . . . . . . . . . . . . . 165,189 168,153 Prepaid expenses and deferred charges. . . . . . . . . 42,325 40,829 -------- -------- Total current assets . . . . . . . . . . . . . . . . 425,861 418,872 -------- -------- Property and equipment, net. . . . . . . . . . . . . . 482,266 461,316 Excess of cost of investments in subsidiaries over net assets acquired . . . . . . . 29,372 29,743 Other assets . . . . . . . . . . . . . . . . . . . . . 13,551 13,408 -------- -------- Total. . . . . . . . . . . . . . . . . . . . . . . . 42,923 43,151 -------- -------- TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . $951,050 $923,339 -------- -------- -------- -------- LIABILITIES AND STOCKHOLDERS' EQUITY Short-term borrowings. . . . . . . . . . . . . . . . . $ 1,671 $ 1,671 Current portion of long-term debt. . . . . . . . . . . 5 753 Accounts payable . . . . . . . . . . . . . . . . . . . 151,469 159,272 Accrued salaries and wages . . . . . . . . . . . . . . 25,509 31,956 Accrued income and other taxes . . . . . . . . . . . . 21,819 17,166 -------- -------- Total current liabilities. . . . . . . . . . . . . . 200,473 210,818 Long-term debt, less current portion . . . . . . . . . 171,810 171,728 Deferred taxes . . . . . . . . . . . . . . . . . . . . 42,576 40,013 Other liabilities and deferred credits . . . . . . . . 60,345 58,823 -------- -------- Total liabilities. . . . . . . . . . . . . . . . . . 475,204 481,382 -------- -------- Minority interest. . . . . . . . . . . . . . . . . . . 26,993 23,930 STOCKHOLDERS' EQUITY: Common stock (56,003,366 and 55,723,731 shares). . 5,600 5,572 Capital in excess of par value . . . . . . . . . . 104,711 101,290 Retained income. . . . . . . . . . . . . . . . . . 460,107 439,364 Cumulative translation adjustment. . . . . . . . . 11,928 5,294 Common stock held in treasury (4,512,405 shares) . (133,493) (133,493) -------- -------- Total stockholders' equity . . . . . . . . . . . . . 448,853 418,027 -------- -------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY . . . . . . $951,050 $923,339 -------- -------- -------- --------
EXHIBIT 19 - FINANCIAL STATEMENTS FURNISHED TO SECURITY HOLDERS BEMIS COMPANY, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOWS (IN THOUSANDS OF DOLLARS)
Six Months Ended June 30 ------------------ 1995 1994 ---- ---- CASH FLOWS FROM OPERATING ACTIVITIES Net income . . . . . . . . . . . . . . . . . . . . . . . . . $ 37,220 $ 32,272 NON-CASH ITEMS: Depreciation and amortization. . . . . . . . . . . . . . 29,822 26,882 Minority interest. . . . . . . . . . . . . . . . . . . . 2,132 1,468 Deferred income taxes, non-current portion . . . . . . . 2,443 971 Loss on sale of property and equipment . . . . . . . . . 20 305 -------- -------- Cash provided by operations. . . . . . . . . . . . . . . . . 71,637 61,898 -------- -------- Net change in receivables, inventories, prepaid expenses and payables . . . . . . . . . . . . . . (12,176) (5,134) Net change in deferred charges and credits . . . . . . . . . 1,646 (2,713) Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . 482 53 -------- -------- Net cash provided by operating activities. . . . . . . . . . 61,589 54,104 -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES Additions to property and equipment. . . . . . . . . . . . . (48,143) (50,796) Business acquisitions. . . . . . . . . . . . . . . . . . . . (33,248) Proceeds from sale of property and equipment . . . . . . . . 1,752 433 Change in long-term receivables. . . . . . . . . . . . . . . (17) 106 -------- -------- Net cash used in investing activities. . . . . . . . . . . . (46,408) (83,505) -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES Change in long-term debt . . . . . . . . . . . . . . . . . . (163) 48,543 Change in short-term debt. . . . . . . . . . . . . . . . . . (630) 203 Cash dividends paid. . . . . . . . . . . . . . . . . . . . . (16,477) (13,827) Stock incentive programs . . . . . . . . . . . . . . . . . . 3,449 83 -------- -------- Net cash (used) provided by financing activities . . . . . . (13,821) 35,002 -------- -------- Effect of exchange rates on cash . . . . . . . . . . . . . . 2,051 1,248 -------- -------- Net increase in cash . . . . . . . . . . . . . . . . . . . . $ 3,411 $ 6,849 -------- -------- -------- --------
EXHIBIT 19 - FINANCIAL STATEMENTS FURNISHED TO SECURITY HOLDERS BEMIS COMPANY, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS TAXES BASED ON INCOME The Company's 1995 effective tax rate of 38% differs from the federal statutory rate of 35% primarily due to state and local income taxes. EX-27 3 EXHIBIT 27
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE JUNE 30, 1995, CONSOLIDATED STATEMENT OF INCOME AND CONSOLIDATED BALANCE SHEET AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 6-MOS DEC-31-1994 JAN-01-1995 JUN-30-1995 16,137 0 202,210 0 165,189 425,861 750,610 (268,344) 951,050 200,473 171,810 5,600 0 0 443,253 951,050 751,731 751,731 590,342 590,342 (803) 0 5,767 59,620 22,400 37,220 0 0 0 37,220 .72 .72
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