Delaware | 000-51515 | 20-1489747 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
395 Oyster Point Boulevard, Suite 415 South San Francisco, California | 94080 |
(Address of principal executive offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Number | Description | |
99.1 | Press Release of Core-Mark Holding Company, Inc. dated May 10, 2016 with attachments. |
CORE-MARK HOLDING COMPANY, INC. | ||||
Date: | May 10, 2016 | By: | /s/ CHRISTOPHER M. MILLER | |
Name: | Christopher M. Miller | |||
Title: | Chief Financial Officer |
Number | Description | |
99.1 | Press Release of Core-Mark Holding Company, Inc. dated May 10, 2016 with attachments. |
• | Record First Quarter Sales of $3.0 Billion |
• | Fresh Sales Increased 16.4%; Total Non-cigarette Sales Increased 11.1% |
• | Diluted EPS was $0.24 Per Share, or $0.33 Per Share Excluding LIFO Expense |
• | Announced $0.16 Dividend Payable June 15, 2016 |
RECONCILIATION OF GROSS PROFIT TO REMAINING GROSS PROFIT | ||||||||||
(Unaudited and $ in millions) | ||||||||||
For the Three Months Ended March 31, | ||||||||||
2016 | 2015 | % Change | ||||||||
Gross profit | $ | 151.1 | $ | 137.3 | 10.1 | % | ||||
Cigarette inventory holding gains | (1.0 | ) | (1.0 | ) | ||||||
OTP tax items | — | (0.9 | ) | |||||||
LIFO expense | 3.4 | 2.4 | ||||||||
Remaining gross profit | $ | 153.5 | $ | 137.8 | 11.4 | % |
RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA | ||||||||||
(Unaudited and $ in millions) | ||||||||||
For the Three Months Ended March 31, | ||||||||||
2016 | 2015 | % Change | ||||||||
Net income | $ | 5.7 | $ | 5.5 | 3.6 | % | ||||
Interest expense, net (1) | 0.7 | 0.4 | ||||||||
Provision for income taxes | 3.5 | 3.6 | ||||||||
Depreciation & amortization | 9.6 | 8.7 | ||||||||
LIFO expense | 3.4 | 2.4 | ||||||||
Stock-based compensation expense | 1.9 | 1.9 | ||||||||
Foreign currency transaction losses (gains), net | (0.7 | ) | 0.4 | |||||||
Adjusted EBITDA | $ | 24.1 | $ | 22.9 | 5.2 | % |
CORE-MARK HOLDING COMPANY, INC. AND SUBSIDIARIES | |||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||
(In millions, except share and per share data) | |||||||
(Unaudited) | |||||||
March 31, | December 31, | ||||||
2016 | 2015 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 11.5 | $ | 12.5 | |||
Restricted cash | 8.7 | 8.5 | |||||
Accounts receivable, net of allowance for doubtful accounts of $11.3 and $10.9 as of March 31, 2016 and December 31, 2015, respectively | 337.2 | 272.7 | |||||
Other receivables, net | 71.5 | 69.4 | |||||
Inventories, net | 389.3 | 407.4 | |||||
Deposits and prepayments | 78.4 | 65.0 | |||||
Deferred income taxes | 1.8 | 1.8 | |||||
Total current assets | 898.4 | 837.3 | |||||
Property and equipment, net | 158.2 | 159.5 | |||||
Goodwill | 22.9 | 22.9 | |||||
Other intangible assets, net | 30.0 | 29.5 | |||||
Other non-current assets, net | 28.3 | 28.1 | |||||
Total assets | $ | 1,137.8 | $ | 1,077.3 | |||
Liabilities and Stockholders’ Equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 201.3 | $ | 129.6 | |||
Book overdrafts | 30.2 | 29.2 | |||||
Cigarette and tobacco taxes payable | 190.2 | 193.6 | |||||
Accrued liabilities | 128.3 | 106.9 | |||||
Deferred income taxes | 0.3 | 0.3 | |||||
Total current liabilities | 550.3 | 459.6 | |||||
Long-term debt | 28.0 | 60.4 | |||||
Deferred income taxes | 19.4 | 18.6 | |||||
Other long-term liabilities | 10.5 | 10.6 | |||||
Claims liabilities | 26.8 | 26.6 | |||||
Pension liabilities | 7.4 | 7.5 | |||||
Total liabilities | 642.4 | 583.3 | |||||
Contingencies | |||||||
Stockholders’ equity: | |||||||
Common stock, $0.01 par value (100,000,000 shares authorized, 26,097,193 and 25,976,677 shares issued; 23,156,234 and 23,058,335 shares outstanding at March 31, 2016 and December 31, 2015, respectively) | 0.3 | 0.3 | |||||
Additional paid-in capital | 271.0 | 271.8 | |||||
Treasury stock at cost (2,940,959 and 2,918,342 shares of common stock at March 31, 2016 and December 31, 2015, respectively) | (63.5 | ) | (61.8 | ) | |||
Retained earnings | 301.9 | 300.0 | |||||
Accumulated other comprehensive loss | (14.3 | ) | (16.3 | ) | |||
Total stockholders’ equity | 495.4 | 494.0 | |||||
Total liabilities and stockholders’ equity | $ | 1,137.8 | $ | 1,077.3 |
CORE-MARK HOLDING COMPANY, INC. AND SUBSIDIARIES | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||
(In millions, except per share data) | |||||||
(Unaudited) | |||||||
Three Months Ended | |||||||
March 31, | |||||||
2016 | 2015 | ||||||
Net sales | $ | 3,011.3 | $ | 2,452.3 | |||
Cost of goods sold | 2,860.2 | 2,315.0 | |||||
Gross profit | 151.1 | 137.3 | |||||
Warehousing and distribution expenses | 91.6 | 79.5 | |||||
Selling, general and administrative expenses | 49.4 | 47.3 | |||||
Amortization of intangible assets | 0.9 | 0.6 | |||||
Total operating expenses | 141.9 | 127.4 | |||||
Income from operations | 9.2 | 9.9 | |||||
Interest expense | (0.8 | ) | (0.6 | ) | |||
Interest income | 0.1 | 0.2 | |||||
Foreign currency transaction gains (losses), net | 0.7 | (0.4 | ) | ||||
Income before income taxes | 9.2 | 9.1 | |||||
Provision for income taxes | (3.5 | ) | (3.6 | ) | |||
Net income | $ | 5.7 | $ | 5.5 | |||
Basic and diluted net income per common share (1) | $ | 0.24 | $ | 0.24 | |||
Basic weighted-average shares | 23.2 | 23.2 | |||||
Diluted weighted-average shares | 23.3 | 23.3 | |||||
Dividends declared and paid per common share | $ | 0.16 | $ | 0.13 | |||
(1) Basic and diluted earnings per share are calculated based on unrounded actual amounts. |
CORE-MARK HOLDING COMPANY, INC. AND SUBSIDIARIES | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
(In millions) | |||||||
(Unaudited) | |||||||
Three Months Ended | |||||||
March 31, | |||||||
2016 | 2015 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 5.7 | $ | 5.5 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
LIFO and inventory provisions | 3.4 | 2.4 | |||||
Amortization of debt issuance costs | 0.1 | 0.1 | |||||
Stock-based compensation expense | 1.9 | 1.9 | |||||
Bad debt expense, net | 0.4 | 0.5 | |||||
Depreciation and amortization | 9.6 | 8.7 | |||||
Foreign currency transaction (gains)/losses, net | (0.7 | ) | 0.4 | ||||
Deferred income taxes | 0.8 | (0.7 | ) | ||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable, net | (63.6 | ) | (6.2 | ) | |||
Other receivables, net | (0.1 | ) | 0.1 | ||||
Inventories, net | 17.1 | 116.9 | |||||
Deposits, prepayments and other non-current assets | (13.6 | ) | (14.0 | ) | |||
Excess tax deductions associated with stock-based compensation | (2.4 | ) | (1.9 | ) | |||
Accounts payable | 70.3 | 13.4 | |||||
Cigarette and tobacco taxes payable | (5.2 | ) | (36.1 | ) | |||
Pension, claims, accrued and other long-term liabilities | 25.5 | (8.9 | ) | ||||
Net cash provided by operating activities | 49.2 | 82.1 | |||||
Cash flows from investing activities: | |||||||
Acquisition of business, net of cash acquired | — | (8.0 | ) | ||||
Change in restricted cash | (0.1 | ) | 2.0 | ||||
Additions to property and equipment, net | (8.8 | ) | (2.7 | ) | |||
Capitalization of software and related development costs | (2.2 | ) | (1.9 | ) | |||
Proceeds from sale of fixed assets | — | 0.3 | |||||
Net cash used in investing activities | (11.1 | ) | (10.3 | ) | |||
Cash flows from financing activities: | |||||||
Repayments under revolving credit facility, net | (32.3 | ) | (54.9 | ) | |||
Dividends paid | (3.8 | ) | (3.1 | ) | |||
Payments on capital leases | (0.6 | ) | (0.6 | ) | |||
Repurchases of common stock | (1.7 | ) | (3.0 | ) | |||
Proceeds from exercise of common stock options | — | 0.3 | |||||
Tax withholdings related to net share settlements of restricted stock units | (5.1 | ) | (3.1 | ) | |||
Excess tax deductions associated with stock-based compensation | 2.4 | 1.9 | |||||
Increase (decrease) in book overdrafts | 1.0 | (6.2 | ) | ||||
Net cash used in financing activities | (40.1 | ) | (68.7 | ) | |||
Effects of changes in foreign exchange rates | 1.0 | (1.0 | ) | ||||
Change in cash and cash equivalents | (1.0 | ) | 2.1 | ||||
Cash and cash equivalents, beginning of period | 12.5 | 14.4 | |||||
Cash and cash equivalents, end of period | $ | 11.5 | $ | 16.5 | |||
Supplemental disclosures: | |||||||
Cash paid during the period for: | |||||||
Income taxes, net | $ | 0.3 | $ | 0.8 | |||
Interest | $ | 0.5 | $ | 0.3 | |||
Non-cash capital lease obligations incurred | $ | 0.2 | $ | 5.2 | |||
Unpaid property and equipment purchases included in accrued liabilities | $ | 1.4 | $ | 0.4 |
CORE-MARK HOLDING COMPANY, INC. AND SUBSIDIARIES | ||||||||||
SUPPLEMENTAL SCHEDULE FOR ITEMS IMPACTING DILUTED EPS | ||||||||||
(In millions, except per share data) | ||||||||||
(Unaudited) | ||||||||||
Three Months Ended March 31, | ||||||||||
2016 (a)(b) | 2015 (a)(b) | % Change | ||||||||
Net income | $ | 5.7 | $ | 5.5 | 3.6 | % | ||||
Diluted shares | 23.3 | 23.3 | ||||||||
Diluted EPS | $ | 0.24 | $ | 0.24 | ||||||
LIFO expense | 0.09 | 0.06 | ||||||||
Diluted EPS excluding LIFO expense | $ | 0.33 | $ | 0.30 | 10.0 | % | ||||
Additional Items Impacting Diluted EPS: | ||||||||||
Cigarette inventory holding gains (1) | $ | 0.03 | $ | 0.03 | ||||||
Net Other Tobacco Product (OTP) tax items (2) | — | 0.02 | ||||||||
Business expansion and integration costs (3) | (0.05 | ) | (0.01 | ) | ||||||
Legacy legal settlement (4) | 0.05 | — | ||||||||
Foreign exchange gains / (losses) (5) | 0.02 | (0.01 | ) | |||||||
(a) Amounts and percentages have been rounded for presentation purposes and might differ from unrounded results. (b) The per share impacts of the above items were calculated using a normal tax rate of approximately 38.0% and 39.6% for the three months ended March 31, 2016 and 2015, respectively. | ||||||||||
(1) Cigarette inventory holding gains | ||||||||||
Cigarette inventory holding gains were $1.0 million for both the three months ended March 31, 2016 and 2015. | ||||||||||
(2) Net OTP tax items | ||||||||||
For the three months ended March 31, 2015, the Company recognized OTP tax refunds of $0.9 million related to prior years’ taxes, net of fees and interest. | ||||||||||
(3) Business expansion and integration costs | ||||||||||
During the three months ended March 31, 2016, we incurred approximately $1.9 million in business expansion and integration expenses related to the onboarding of Murphy USA and the pending acquisition of Pine State Trading Company's Convenience Division. During the three months ended March 31, 2015, we incurred approximately $0.3 million in business expansion and integration expenses as related to the acquisition of Karrys Bros. Limited. | ||||||||||
(4) Legacy legal settlement | ||||||||||
During the three months ended March 31, 2016, the Company recorded a gain of approximately $2.0 million, net of legal costs, related to the settlement of a legacy legal proceeding with Sonitrol Corporation. | ||||||||||
(5) Foreign exchange gains / (losses) | ||||||||||
During the three months ended March 31, 2016, the Company recognized foreign exchange transaction gains of $0.7 million. The Company recognized a foreign exchange transaction loss of $0.4 million for the three month period ended March 31, 2015. |
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