-----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, OC0kihY/uU41vWtMi2jzZ51LFH7CVWPBwvs7NJpjQSeOl3hP7/mJPnq/UPhqmzrr 6mpVCEMAj6R8c5xj11TJ1w== 0000950152-95-002408.txt : 19951026 0000950152-95-002408.hdr.sgml : 19951026 ACCESSION NUMBER: 0000950152-95-002408 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951025 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: DIEBOLD INC CENTRAL INDEX KEY: 0000028823 STANDARD INDUSTRIAL CLASSIFICATION: CALCULATING & ACCOUNTING MACHINES (NO ELECTRONIC COMPUTERS) [3578] IRS NUMBER: 340183970 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-04879 FILM NUMBER: 95583666 BUSINESS ADDRESS: STREET 1: P.O. BOX 8230 CITY: CANTON STATE: OH ZIP: 44711-8230 BUSINESS PHONE: 2164894000 MAIL ADDRESS: STREET 1: PO BOX 8230 CITY: CANTON STATE: OH ZIP: 44711-8230 10-Q 1 DIEBOLD, INC. 10-Q 1 - -------------------------------------------------------------------------------- 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 September 30, 1995 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 number 1-4879 ------ DIEBOLD, INCORPORATED ---------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Ohio 34-0183970 - -------------------------------- ------------------------------------ (State or other jurisdiction of (IRS Employer Identification Number) incorporation or organization) P. O. Box 8230, Canton, Ohio 44711-8230 - ---------------------------------------- ------------------ (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (216) 489-4000 - -------------------------------------------------------------------------------- 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 --- --- Indicate the number of shares outstanding of each of the issuer's classes of Common Shares, as of the latest practicable date. Class Outstanding at October 20, 1995 ----- ------------------------------- Common Shares $1.25 Par Value 30,528,472 Shares - ------------------------------ ------------------ -1- 2 DIEBOLD, INCORPORATED AND SUBSIDIARIES FORM 10-Q INDEX
Page No. -------- PART I. FINANCIAL INFORMATION ITEM 1. Financial Statements Condensed Consolidated Balance Sheets - September 30, 1995 and December 31, 1994 3 Condensed Consolidated Statements of Income - Three Months and Nine Months Ended September 30, 1995 and 1994 4 Condensed Consolidated Statements of Cash Flows - Nine Months Ended September 30, 1995 and 1994 5 Notes to Condensed Consolidated Financial Statements 6 ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 7 PART II. OTHER INFORMATION ITEM 6. Exhibits and Reports on Form 8-K 8 SIGNATURES 10 INDEX TO EXHIBITS 11
-2- 3 DIEBOLD, INCORPORATED AND SUBSIDIARIES FORM 10-Q PART I - FINANCIAL INFORMATION ITEM 1. - FINANCIAL STATEMENTS CONDENSED CONSOLIDATED BALANCE SHEETS ------------------------------------- (Dollars in thousands except per share amounts)
(Unaudited) September 30, December 31, ASSETS 1995 1994 - ------ ------------ ---------------- Current assets Cash and cash equivalents $ 42,730 $ 17,285 Short-term investments 29,262 38,400 Trade receivables 178,115 153,107 Inventories 85,071 85,543 Prepaid expenses and other current assets 31,746 31,754 --------- --------- Total current assets 366,924 326,089 Securities and other investments 150,585 155,800 Property, plant and equipment, at cost 173,113 152,314 Less accumulated depreciation and amortization 94,047 87,601 ---------- ---------- 79,066 64,713 Deferred income taxes 4,433 5,042 Other assets 118,254 110,239 ---------- ---------- $ 719,262 $ 661,883 ========== ========= LIABILITIES AND SHAREHOLDERS' EQUITY - ------------------------------------ Current liabilities Accounts payable and other current liabilities $ 119,401 $ 108,994 Deferred income 55,311 46,470 ---------- -------- Total current liabilities 174,712 155,464 Pensions 15,333 10,545 Postretirement benefits 21,707 21,627 Minority interest 14,290 15,028 Shareholders' equity Preferred Shares, no par value, authorized 1,000,000 shares, none issued Common Shares, par value $1.25, authorized 50,000,000, issued 30,609,638 and 30,515,146 shares, respectively 38,262 38,144 Additional capital 70,319 68,320 Retained earnings 398,226 365,513 Treasury shares, at cost (83,731 and 55,100 shares, respectively) (3,749) (3,186) Other (9,838) (9,572) ---------- --------- Total shareholders' equity 493,220 459,219 ---------- --------- $ 719,262 $ 661,883 ========= ========= See accompanying notes to condensed consolidated financial statements.
-3- 4 DIEBOLD, INCORPORATED AND SUBSIDIARIES FORM 10-Q CONDENSED CONSOLIDATED STATEMENTS OF INCOME ------------------------------------------- (Unaudited) (In thousands except per share amounts)
Three Months Ended Nine Months Ended September 30 September 30 ---------------------- ---------------------- Net sales 1995 1994 1995 1994 -------- --------- -------- -------- Products $138,720 $ 117,711 $392,063 $347,090 Services 77,280 70,488 227,884 205,954 -------- --------- -------- -------- 216,000 188,199 619,947 553,044 Cost of sales Products 85,972 76,438 245,013 225,492 Services 55,738 47,820 163,152 142,776 -------- -------- -------- -------- 141,710 124,258 408,165 368,268 -------- -------- -------- -------- Gross profit 74,290 63,941 211,782 184,776 Selling and administrative expense 34,535 31,732 102,964 92,543 Research, development and engineering expense 11,170 9,339 31,316 26,336 -------- -------- -------- -------- 45,705 41,071 134,280 118,879 -------- -------- -------- -------- Operating profit 28,585 22,870 77,502 65,897 Investment income 5,101 3,323 11,412 8,190 Miscellaneous, net (2,951) (1,281) (6,593) (4,978) Minority interest (77) 81 (715) (1,327) -------- -------- ---------- ---------- Income before taxes 30,658 24,993 81,606 67,782 Taxes on income 10,115 8,282 26,930 22,192 -------- -------- --------- --------- Net income $ 20,543 $ 16,711 $ 54,676 $ 45,590 ======== ======== ========= ======== Weighted average number of Common Shares outstanding 30,521 30,321 30,503 30,310 Net income per Common Share $ 0.67 $ 0.55 $ 1.79 $ 1.50 ======== ======== ========= ======== Cash dividends paid per Common Share $ 0.24 $ 0.22 $ 0.72 $ 0.66 ======== ======== ======== ======== See accompanying notes to condensed consolidated financial statements.
-4- 5 DIEBOLD, INCORPORATED AND SUBSIDIARIES FORM 10-Q CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS ----------------------------------------------- (Unaudited) (Dollars in thousands)
Nine Months Ended September 30, ------------------------- 1995 1994 --------- --------- Cash flow from operating activities: Net income $54,676 $ 45,590 Adjustments to reconcile net income to cash provided by operating activities: Minority share of income 715 1,327 Depreciation and amortization 10,289 9,795 Other charges and amortization 12,305 12,275 Cash used by changes in certain current assets and liabilities (17,077) (16,822) Changes in deferred income 8,841 (252) Other (3,517) (8,525) --------- --------- Total adjustments 11,556 (2,202) -------- -------- Net cash provided by operating activities 66,232 43,388 Cash flow from investing activities: Proceeds from maturities of investments 62,857 50,220 Payments for purchases of investments (49,670) (47,477) Capital expenditures (25,419) (15,199) Increase in certain other assets (6,808) (30,396) Other 116 593 -------- -------- Net cash used in investing activities (18,924) (42,259) Cash flow from financing activities: Dividends paid (21,963) (20,007) Proceeds from issuance of Common Shares 1,554 3,597 Other (1,454) (897) --------- ---------- Net cash used in financing activities (21,863) (17,307) ---------- ----------- Increase/(Decrease) in cash and cash equivalents 25,445 (16,178) Cash and cash equivalents at the beginning of the period 17,285 39,006 -------- --------- Cash and cash equivalents at the end of the period $ 42,730 $ 22,828 ======== ========= See accompanying notes to condensed consolidated financial statements.
-5- 6 DIEBOLD, INCORPORATED AND SUBSIDIARIES FORM 10-Q NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ---------------------------------------------------- (Unaudited) (Dollars in thousands) 1. The financial information included herein is unaudited; however, such information reflects all adjustments (consisting solely of normal recurring adjustments) which are, in the opinion of Management, necessary for a fair statement of the results for the interim periods. 2. The results of operations for the three month and nine month periods ended September 30, 1995 are not necessarily indicative of results to be expected for the full year. 3. The Net income per Common Share computations in the condensed consolidated statements of income are based on the weighted average number of shares outstanding during each period reported.
4. Inventory detail at: September 30, 1995 December 31, 1994 ------------------ ----------------- Finished goods and service parts $ 18,466 $ 20,786 Work in process 66,449 64,617 Raw materials 156 140 --------- --------- Total inventory $ 85,071 $ 85,543 ======== ========
5. The Registrant has reclassified the presentation of certain prior-year information to conform with the current presentation format. 6. On October 20, 1995, the Registrant entered into a merger agreement to purchase the stock of Griffin Technology Incorporated (Griffin) based in Farmington, New York. Griffin shares are traded on the NASDAQ National Market under the symbol of GRIF. Pursuant to the merger agreement, the Registrant will commence a tender offer for all issued and outstanding shares of Griffin for $7.75 per share in cash. -6- 7 DIEBOLD, INCORPORATED AND SUBSIDIARIES FORM 10-Q ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS As of September 30, 1995 (Unaudited) (Dollars in thousands except for per share data) Changes in Financial Condition - ------------------------------ The balance sheet of the Registrant continued to reflect a strong financial position at September 30, 1995. Cash, cash equivalents and short-term investments increased to $71,992 at September 30, 1995 compared to $55,685 at December 31, 1994. These assets along with securities and other investments accounted for 31% and 32% of total assets at September 30, 1995 and December 31, 1994, respectively. Securities and other investments consist principally of tax-free municipal bonds, preferred stock, and other investments. Trade receivables have increased consistent with the increase in volumes. As a percentage of consolidated net sales for the prior 12 months, trade receivables are at 21 percent at September 30, 1995 compared to 20 percent at December 31, 1994. Increase in property plant and equipment, at cost is primarily due to new construction and remodeling of facilities and the purchase of equipment to support increased engineering efforts. Future capital expenditures and increases in working capital are expected to be financed through internally generated funds. The Registrant's investment portfolio is available for funding needs if required. External financing is also available if needed through the Registrant's lines of credit. At September 30, 1995, the Registrant had unused lines of credit approximating $40,000 and the Registrant is not restricted as to the use of funds borrowed under these credit agreements. Therefore, such commitments represent an additional and immediate source of liquidity. The Registrant's strong financial position enhances its ability to obtain additional funds if required. Shareholders' equity per Common Share at September 30, 1995 improved to $16.16 from $15.08 at December 31, 1994. The third quarter cash dividend of $.24 per share was paid on September 8, 1995 to shareholders of record on August 18, 1995. On October 17, 1995 the fourth quarter cash dividend of $.24 per share was declared payable on December 8, 1995 to shareholders of record on November 17, 1995. Diebold, Incorporated shares are listed on the New York Stock Exchange under the symbol of DBD. The market price during the first nine months of 1995 fluctuated within the range of $33.00 and $49.38. Results of Operations - --------------------- Third Quarter 1995 Comparison to Third Quarter 1994 - --------------------------------------------------- Consolidated net sales for the third quarter of 1995 increased from the same period in 1994 by $27,801 or 15%. Total gross profit increased $10,349 or 16% over third quarter's performance for 1994. Product gross profit accounted for this increase resulting from the increased sales volume of self service systems and continuing cost containment efforts. Operating expenses increased $4,634 or 11% over the same period in 1994 largely due to an increase of 20% in expenditures related to research and development of new products. There was also higher selling and administrative expenses associated with the increase in sales activity. Operating profit increased $5,715 or 25% over third quarter 1994's performance. -7- 8 DIEBOLD, INCORPORATED AND SUBSIDIARIES FORM 10-Q ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) As of September 30, 1995 (Unaudited) (Dollars in thousands) Nine-Month 1995 Comparison to Nine-Month 1994 - --------------------------------------------- Consolidated net sales for the nine months ended 1995 exceeded the same period in 1994 by $66,903 or 12%. Total gross profit increased $27,006 or 15% over 1994's performance. Product gross profit continued to account for the majority of this increase in total gross profit due to the increased sales volume and reduction of costs resulting from manufacturing improvements. Operating expenses increased $15,401 or 13% over the same period in 1994 due to a 19% increase in expenditures related to the research and development of new products. There was also higher selling and administrative expenses associated with the increase in sales activity. Operating profit for the nine months ended September 30, 1995 exceeded the same period in 1994 by $11,605 or 18%. The Registrant's backlog of unfilled orders was $169,308 at September 30, 1995 compared to $147,268 at September 30, 1994, a $22,040 or 15% increase. The Registrant believes, however, that order backlog information is not, by itself, a meaningful indicator of future revenue streams. There are numerous factors which influence the amount and timing of revenue recognized in future periods. PART II. OTHER INFORMATION ITEM 6. Exhibits and Reports on Form 8-K (a) Exhibits 3.1(i) Amended and Restated Articles of Incorporation of Diebold, Incorporated -- incorporated by reference to Exhibit 3.1(i) of Registrant's Annual Report on Form 10-K for the year ended December 31, 1994. 3.1(ii) Code of Regulations -- incorporated by reference to Exhibit 4(c) to Registrant's Post-Effective Amendment No. 1 to Form S-8 Registration Statement No. 33-32960. 3.2 Certificate of Amendment by Shareholders to Amended Articles of Incorporation of Diebold, Incorporated -- incorporated by reference to Exhibit 3.1 to Registrant's Annual Report on Form 10-K for the year ended December 31, 1992. 4. Rights Agreement dated as of February 10, 1989 between Diebold, Incorporated and Ameritrust Company National Association -- incorporated by reference to Exhibit 2.1 to Registrant's Registration Statement on Form 8-A dated February 10, 1989. -8- 9 ITEM 6. Exhibits and Reports on Form 8-K (continued) * 10.1 Form of Employment Agreement as amended and restated as of September 13, 1990 -- incorporated by reference to Exhibit 10.1 to Registrant's Annual Report on Form 10-K for the year ended December 31, 1990. * 10.2 Schedule of Certain Officers who are Parties to Employment Agreements in the form of Exhibit 10.1. -- incorporated by reference to Exhibit 10.2 to Registrant's Annual Report on Form 10-K for the year ended December 31, 1992. * 10.3 Supplemental Pension Agreement with Raymond Koontz -- incorporated by reference to Exhibit 10.3 of Registrant's Annual Report on Form 10-K for the year ended December 31, 1994. * 10.4 Supplemental Retirement Benefit Agreement with Robert W. Mahoney -- incorporated by reference to Exhibit 10.4 of Registrant's Annual Report on Form 10-K for the year ended December 31, 1994. * 10.5 Supplemental Employee Retirement Plan (as amended January 1, 1994) -- incorporated by reference to Exhibit 10.5 of Registrant's Annual Report on Form 10-K for the year ended December 31, 1994. 10.6 Amended and Restated Partnership Agreement dated as of September 12, 1990 -- incorporated by reference to Exhibit 10 to Registrant's Form 8-K dated September 26, 1990. * 10.7 1985 Deferred Compensation Plan for Directors of Diebold, Incorporated -- incorporated by reference to Exhibit 10.7 to Registrant's Annual Report on Form 10-K for the year ended December 31, 1992. * 10.8 1991 Equity and Performance Incentive Plan -- incorporated by reference to Exhibit 4(a) to Registrant's Form S-8 Registration Statement No. 33-39988. * 10.9 Long-Term Executive Incentive Plan -- incorporated by reference to Exhibit 10.9 of Registrant's Annual Report on Form 10-K for the year ended December 31, 1993. * 10.10 1992 Deferred Incentive Compensation Plan (as amended and restated as of July 1, 1993) -- incorporated by reference to Exhibit 10.10 to Registrant's Annual Report on Form 10-K for the year ended December 31, 1993. * 10.11 Annual Incentive Plan -- incorporated by reference to Exhibit 10.11 to Registrant's Annual Report on Form 10-K for the year ended December 31, 1992. * 10.12 Employment Agreement with Robert P. Barone -- incorporated by reference to Exhibit 10.12 to Registrant's Form 10-Q for the quarter ended September 30, 1994. 27. Financial Data Schedule. (b) Reports on Form 8-K. No reports have been filed by the Registrant on Form 8-K during the period covered by this report. * Reflects management contract or other compensatory arrangement. -9- 10 DIEBOLD, INCORPORATED AND SUBSIDIARIES FORM 10-Q 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. DIEBOLD, INCORPORATED ------------------------ (Registrant) Date: October 24, 1995 By: /s/Robert W. Mahoney ----------------- ----------------------------------- Robert W. Mahoney Chairman of the Board, President and Chief Executive Officer Date: October 24, 1995 By: /s/Gerald F. Morris ----------------- ----------------------------------- Gerald F. Morris Executive Vice President and Chief Financial Officer (Principal Accounting and Financial Officer) -10- 11 DIEBOLD, INCORPORATED FORM 10-Q INDEX TO EXHIBITS
EXHIBIT NO. PAGE NO. - ----------- -------- 3.1 (i) Amended and Restated Articles of Incorporation of Diebold, Incorporated -- incorporated by reference to Exhibit 3.1(i) of Registrant's Annual Report on Form 10-K for the year ended December 31, 1994. -- 3.1 (ii) Code of Regulations -- incorporated by reference to Exhibit 4(c) to Registrant's Post-Effective Amendment No. 1 to Form S-8 Registration Statement No. 33-32960. -- 3.2 Certificate of Amendment by Shareholders to Amended Articles of Incorporation of Diebold, Incorporated -- incorporated by reference to Exhibit 3.1 to Registrant's Annual Report on Form 10-K for the year ended December 31, 1992. -- 4. Rights Agreement dated as of February 10, 1989 between Diebold, Incorporated and Ameritrust Company National Association -- incorporated by reference to Exhibit 2.1 to Registrant's Registration Statement on Form 8-A dated February 10, 1989. -- 10.1 Form of Employment Agreement as amended and restated as of September 13, 1990 -- incorporated by reference to Exhibit 10.1 to Registrant's Annual Report on Form 10-K for the year ended December 31, 1990. -- 10.2 Schedule of Certain Officers who are Parties to Employment Agreements in the form of Exhibit 10.1. -- incorporated by reference to Exhibit 10.2 to Registrant's Annual Report on Form 10-K for the year ended December 31, 1992. -- 10.3 Supplemental Pension Agreement with Raymond Koontz -- incorporated by reference to Exhibit 10.3 of Registrant's Annual Report on Form 10-K for the year ended December 31, 1994. -- 10.4 Supplemental Retirement Benefit Agreement with Robert W. Mahoney -- incorporated by reference to Exhibit 10.4 of Registrant's Annual Report on Form 10-K for the year ended December 31, 1994. --
-11- 12
EXHIBIT NO. PAGE NO. ----------- -------- 10.5 Supplemental Employee Retirement Plan (as amended January 1, 1994) -- incorporated by reference to Exhibit 10.5 of Registrant's Annual Report on Form 10-K for the year ended December 31, 1994. -- 10.6 Amended and Restated Partnership Agreement dated as of September 12, 1990 -- incorporated by reference to Exhibit 10 to Registrant's Form 8-K dated September 26, 1990. -- 10.7 1985 Deferred Compensation Plan for Directors of Diebold, Incorporated -- incorporated by reference to Exhibit 10.7 to Registrant's Annual Report on Form 10-K for the year ended December 31, 1992. -- 10.8 1991 Equity and Performance Incentive Plan -- incorporated by reference to Exhibit 4(a) to Registrant's Form S-8 Registration Statement No. 33-39988. -- 10.9 Long-Term Executive Incentive Plan -- incorporated by reference to Exhibit 10.9 of Registrant's Annual Report on Form 10-K for the year ended December 31, 1993. -- 10.10 1992 Deferred Incentive Compensation Plan (as amended and restated as of July 1, 1993) -- incorporated by reference to Exhibit 10.10 to Registrant's Annual Report on Form 10-K for the year ended December 31, 1993. -- 10.11 Annual Incentive Plan -- incorporated by reference to Exhibit 10.11 to Registrant's Annual Report on Form 10-K for the year ended December 31, 1992. -- 10.12 Employment Agreement with Robert P. Barone -- incorporated by reference to Exhibit 10.12 to Registrant's Form 10-Q for the quarter ended September 30, 1994. -- 27. Financial Data Schedule. 13
-12- EX-27 2 EXHIBIT 27
5 1,000 9-MOS DEC-31-1995 JAN-01-1995 SEP-30-1995 42,730 29,262 178,115 0 85,071 366,924 173,113 94,047 719,262 174,712 0 38,262 0 0 468,545 719,262 392,063 619,947 245,013 408,165 134,280 0 0 81,606 26,930 54,676 0 0 0 54,676 1.79 1.79
-----END PRIVACY-ENHANCED MESSAGE-----