-----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, mylnoDxW9do/yLwuB+d0xZekRRXt1gMP8FnRHc2JkSS6PFYcAVGqxa0+dIb7skzc eUzWq70voZyGbys3ucxAsQ== 0000024491-94-000010.txt : 19940518 0000024491-94-000010.hdr.sgml : 19940518 ACCESSION NUMBER: 0000024491-94-000010 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19940331 FILED AS OF DATE: 19940427 FILER: COMPANY DATA: COMPANY CONFORMED NAME: COOPER TIRE & RUBBER CO CENTRAL INDEX KEY: 0000024491 STANDARD INDUSTRIAL CLASSIFICATION: 3011 IRS NUMBER: 344297750 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-04329 FILM NUMBER: 94524592 BUSINESS ADDRESS: STREET 1: LIMA & WESTERN AVENUES CITY: FINDLAY STATE: OH ZIP: 45840 BUSINESS PHONE: 4194231321 10-Q 1 10-Q FOR PERIOD ENDING MARCH 31, 1994 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM 10-Q (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1994 OR ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 Commission File No. 1-4329 COOPER TIRE & RUBBER COMPANY (Exact name of registrant as specified in its charter) DELAWARE 34-4297750 (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification no.) Lima and Western Avenues, Findlay, Ohio 45840 (Address of principal executive offices) (Zip code) (419) 423-1321 (Registrant's telephone number, including area code) 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 ( ) Number of shares of common stock of registrant outstanding at April 22, 1994: 83,623,872 1 Part I. FINANCIAL INFORMATION Item 1. FINANCIAL STATEMENTS COOPER TIRE & RUBBER COMPANY BALANCE SHEETS
March 31, December 31, 1994 1993 (Unaudited) (Audited) ----------- ------------ ASSETS Current assets: Cash, including short-term investments of $5,500,000 ($15,000,000 in 1993) $ 17,225,749 $ 25,798,746 Accounts receivable, less allowances of $3,400,000 ($3,100,000 in 1993) 225,186,818 182,203,436 Inventories at lower of cost (last-in, first-out) or market: Finished goods 79,192,241 81,066,480 Work in process 9,435,470 10,381,354 Raw materials and supplies 19,975,683 19,663,017 ----------- ----------- 108,603,394 111,110,851 Prepaid expenses and deferred taxes 12,465,794 12,904,058 ----------- ----------- Total current assets 363,481,755 332,017,091 Property, plant and equipment - net 535,054,325 527,949,046 Other assets 29,520,530 29,618,164 ----------- ----------- $928,056,610 $889,584,301 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 72,705,844 $ 65,685,355 Accrued liabilities 47,052,535 50,063,327 Income taxes 13,199,140 6,066,283 Current portion of debt 5,359,000 5,345,000 ----------- ----------- Total current liabilities 138,316,519 127,159,965 Long-term debt 38,532,644 38,729,367 Postretirement benefits other than pensions 120,575,680 118,542,360 Other long-term liabilities 36,316,559 36,015,019 Deferred income taxes 21,878,000 18,952,000 Stockholders' equity: Preferred stock, $1 par value; 5,000,000 shares authorized; none issued - - Common stock, $1 par value; 300,000,000 shares authorized; 83,617,872 shares outstanding (83,581,768 in 1993) 83,617,872 83,581,768 Capital in excess of par value 1,523,357 1,215,181 Retained earnings 487,295,979 465,388,641 ----------- ----------- Total stockholders' equity 572,437,208 550,185,590 ----------- ----------- $928,056,610 $889,584,301 =========== =========== See accompanying notes.
2 COOPER TIRE & RUBBER COMPANY STATEMENTS OF INCOME THREE MONTHS ENDED MARCH 31, 1994 AND 1993 (Unaudited)
1994 1993 ---- ---- Revenues: Net sales $329,132,121 $280,099,599 Other income 215,207 276,641 ----------- ----------- 329,347,328 280,376,240 Costs and expenses: Cost of products sold 267,643,868 223,428,159 Selling, general and administrative 18,245,561 16,249,941 Interest and debt expense 721,741 491,981 ----------- ----------- 286,611,170 240,170,081 Income before income taxes 42,736,158 40,206,159 Provision for income taxes 16,230,000 15,010,000 ----------- ----------- Net income $ 26,506,158 $25,196,159 =========== ========== Net income per share $.32 $.30 ==== ==== Average number of shares outstanding 83,609,505 83,530,994 ========== ========== Dividends per share $.055 $.045 ===== ===== See accompanying notes.
3 COOPER TIRE & RUBBER COMPANY STATEMENTS OF CASH FLOWS THREE MONTHS ENDED MARCH 31, 1994 AND 1993 (Unaudited)
1994 1993 ---- ---- Operating activities: Net income $26,506,158 $25,196,159 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 13,794,420 11,920,094 Deferred taxes 2,588,000 1,728,000 Postretirement benefits other than pensions 2,253,320 2,569,612 Increase in accounts receivable (42,983,382) ( 3,494,127) Decrease (increase) in inventories and prepaid expenses 2,945,721 (47,339,491) Increase (decrease) in accounts payable and accrued liabilities 4,009,698 ( 4,741,753) Increase in other long- term liabilities and other 7,695,803 14,737,754 ---------- ---------- Net cash provided by operating activities 16,809,738 576,248 Investing activities: Additions to property, plant and equipment (20,969,600) (28,418,741) Other 24,129 23,213 ---------- ---------- Net cash used in investing activities (20,945,471) (28,395,528) Financing activities: Issuance of debt - - Payments on debt (182,723) ( 198,828) Issuance of common stock 344,280 295,363 Dividends paid (4,598,821) ( 3,759,283) ---------- ---------- Net cash used in financing activities (4,437,264) ( 3,662,748) ---------- ---------- Decrease in cash and short-term investments (8,572,997) (31,482,028) Cash and short-term investments at beginning of year 25,798,746 55,111,255 ---------- ---------- Cash and short-term investments at end of period $17,225,749 $23,629,227 ========== ========== Cash payments for interest $ 1,759,433 $ 147,774 ========== ========== Cash payments for income taxes $ 6,509,143 $ 8,157,578 ========== ========== See accompanying notes.
4 COOPER TIRE & RUBBER COMPANY NOTES TO FINANCIAL STATEMENTS 1. The financial statements at March 31, 1994 and for the three-month periods ended March 31, 1994 and 1993 are unaudited and include all adjustments, consisting only of normal recurring accruals, which the Company considers necessary for a fair presentation of financial position and operating results. The condensed unaudited financial statements have been prepared in accordance with Article 10 of Regulation S-X and, therefore, do not contain all information and footnotes normally contained in annual financial statements; accordingly, they should be read in conjunction with the Financial Statements and notes thereto appearing in the Annual Report on Form 10-K of the Company for the year ended December 31, 1993. 2. Certain amounts for 1993 have been reclassified to conform with 1994 presentations. 3. The results of operations for the three-month period ended March 31, 1994 are not necessarily indicative of those to be expected for the full year. REVIEW BY INDEPENDENT AUDITORS The condensed financial statements included in this filing on Form 10-Q have been reviewed by the Company's independent auditors, Ernst & Young, and their report thereon is attached hereto as Part I - Exhibit 1. All adjustments or additional disclosures proposed by the Company's independent auditors have been reflected in the data presented. 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Net sales for the first quarter of 1994 increased 17.5% when compared to the first quarter of 1993. Sales of both tires and engineered rubber products were higher than for the three month period one year ago. Other income was lower than for the corresponding 1993 period due to decreased investments of cash reserves. Cost of products sold, as a percent of net sales, was higher in the first quarter of 1994 as compared to the first quarter of 1993 due primarily to intense pricing pressure in the replacement tire industry and less favorable operating levels. Selling, general and administrative expenses increased 12.3% compared to the 1993 quarter due to inflation and increased expenditures for advertising. Interest and debt expense was higher than for the first quarter of 1993, reflecting lower amounts of capitalized interest. Income before income taxes increased 6.3% from the quarter one year ago. The impact of the increase in sales was partially offset by intense pricing competition in the replacement tire industry. The financial position of the Company at March 31, 1994 is excellent. Working capital of $225.2 million is up $20.3 million since year end and up $34.6 million from March 31, 1993. The current ratio of 2.6 is unchanged from December 31, 1993 and compares favorably with a current ratio of 2.3 at March 31, 1993. Accounts receivable are up $43.0 million from year-end and up $40.5 million from the balance one year ago reflecting higher sales levels. Inventories are down $2.5 million from year-end and are down $6.7 million from one year ago primarily reflecting decreases in finished goods inventories. 6 PART II. OTHER INFORMATION Item 6(a). Exhibits. (15) Letter regarding unaudited interim financial information. Item 6(b). Reports on Form 8-K. No Form 8-K has been filed. 7 INDEX TO EXHIBITS DESCRIPTION Part I. Exhibit 1. Independent Accountants' Review Report. Part II. Item 6(a). (15) Letter from Ernst & Young, independent accountants, dated April 27, 1994 regarding unaudited interim financial information. 8 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. COOPER TIRE & RUBBER COMPANY /S/ J. Alec Reinhardt --------------------- J. Alec Reinhardt Executive Vice President and Chief Financial Officer (Principal Financial Officer) /S/ J. A. Faisant ----------------- J. A. Faisant Vice President and Corporate Controller (Principal Accounting Officer) April 27, 1994 -------------- (Date) 9 Part I Exhibit 1 INDEPENDENT ACCOUNTANTS' REVIEW REPORT The Board of Directors Cooper Tire & Rubber Company We have reviewed the accompanying balance sheet of Cooper Tire & Rubber Company as of March 31, 1994, and the related statements of income and cash flows for the three-month periods ended March 31, 1994 and 1993. These financial statements are the responsibility of the Company's management. We conducted our reviews in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data, and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, which will be performed for the full year with the objective of expressing an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our reviews, we are not aware of any material modifications that should be made to the accompanying financial statements referred to above for them to be in conformity with generally accepted accounting principles. We have previously audited, in accordance with generally accepted auditing standards, the balance sheet of Cooper Tire & Rubber Company as of December 31, 1993, and the related statements of income, stockholders' equity, and cash flows for the year then ended (not presented herein) and in our report dated February 14, 1994, we expressed an unqualified opinion on those financial statements. In our opinion, the information set forth in the accompanying balance sheet as of December 31, 1993, is fairly stated, in all material respects, in relation to the balance sheet from which it has been derived. /S/ Ernst & Young ----------------- ERNST & YOUNG Toledo, Ohio April 13, 1994 10 Part II Exhibit (15) April 27, 1994 Securities and Exchange Commission Washington, D.C. 20549 We are aware of the incorporation by reference in the registration statements (Form S-3 No. 33-44159 and Form S-8 Nos. 2-58577, 2-77400, 33-5483, 33-35071, 33-47979, 33-47980, 33-47981, 33-47982, 33-52499 and 33-52505) of Cooper Tire & Rubber Company for the registration of its common stock of our report dated April 13, 1994, relating to the unaudited interim financial statements of Cooper Tire & Rubber Company which are included in its Form 10-Q for the quarter ended March 31, 1994. Pursuant to Rule 436(c) of the Securities Act of 1933 our report is not a part of the registration statement prepared or certified by accountants within the meaning of Section 7 or 11 of the Securities Act of 1933. Very truly yours, /S/ Ernst & Young ----------------- ERNST & YOUNG Toledo, Ohio 11 -----END PRIVACY-ENHANCED MESSAGE-----