-----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, TdKLumQKzA9k71GgDU1GNUiJyw1juMlLdDdUmOzuQoh9DK7dMHvweuSO1XfI9+K+ l5F2INnmitn0R0OSAN4dUw== 0000897069-96-000033.txt : 19960216 0000897069-96-000033.hdr.sgml : 19960216 ACCESSION NUMBER: 0000897069-96-000033 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19951231 FILED AS OF DATE: 19960214 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNIVERSAL FOODS CORP CENTRAL INDEX KEY: 0000310142 STANDARD INDUSTRIAL CLASSIFICATION: FOOD & KINDRED PRODUCTS [2000] IRS NUMBER: 390561070 STATE OF INCORPORATION: WI FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-07626 FILM NUMBER: 96519585 BUSINESS ADDRESS: STREET 1: 433 EAST MICHIGAN ST CITY: MILWAUKEE STATE: WI ZIP: 53202 BUSINESS PHONE: 4142716755 MAIL ADDRESS: STREET 1: PO BOX 737 CITY: MILWAUKEE STATE: WI ZIP: 53201 10-Q 1 UNIVERSAL FOODS CORPORATION FORM 10-Q CONFORMED ========================================================================= UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 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: December 31, 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: 1-7626 UNIVERSAL FOODS CORPORATION (Exact name of registrant as specified in its charter) Wisconsin 39-0561070 (State or other jurisdiction of (I.R.S. Employer Identification incorporation or organization) Number) 433 East Michigan Street, Milwaukee, Wisconsin 53202 (Address of principal executive offices) Registrant's telephone number, including area code: (414) 271-6755 NONE (Former name, former address and 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 such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for at least the past 90 days. Yes X No Indicate the number of shares outstanding of each of the issuer's classes of Common Stock as of the latest practicable date. Class Outstanding at December 31, 1995 Common Stock, par value $0.10 per share 26,095,138 shares ========================================================================= UNIVERSAL FOODS CORPORATION INDEX Page No. PART I, FINANCIAL INFORMATION: Consolidated Condensed Balance Sheets - December 31, 1995 and September 30, 1995. 1 Consolidated Condensed Statements of Earnings - Three Months Ended December 31, 1995 and 1994. 2 Consolidated Condensed Statements of Cash Flows - Three Months Ended December 31, 1995 and 1994. 3 Notes to Consolidated Condensed Financial Statements. 4 Management's Discussion and Analysis of Results of Operations, Financial Condition and Forward Looking Information. 5 PART II, OTHER INFORMATION: Item 4, Submission of Matters to a Vote of Security Holders. 7 Item 6, Exhibits and Reports on Form 8-K. 8 Signatures. 9 PART I FINANCIAL INFORMATION UNIVERSAL FOODS CORPORATION CONSOLIDATED CONDENSED BALANCE SHEETS ($000's Omitted) December 31 1995 September 30 ASSETS (Unaudited) 1995 CURRENT ASSETS: Cash and cash equivalents $ 6,844 $ 8,717 Trade accounts receivable 98,066 105,847 Inventories: Finished and in-process products 122,543 119,885 Raw materials and supplies 54,765 59,135 Prepaid expenses and other current assets 33,718 32,780 -------- -------- TOTAL CURRENT ASSETS 315,936 326,364 INVESTMENTS AND OTHER ASSETS 42,592 42,164 INTANGIBLES 147,214 148,654 PROPERTY, PLANT AND EQUIPMENT: Cost: Land and buildings 138,993 139,177 Machinery and equipment 316,862 308,204 -------- -------- 455,855 447,381 Less accumulated depreciation 194,698 187,693 -------- -------- 261,157 259,688 -------- -------- TOTAL ASSETS $766,899 $776,870 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Short-term borrowings $ 2,705 $ 7,108 Accounts payable, accrued expenses and other liabilities 113,063 133,637 Federal and state income taxes 25,465 20,755 Current maturities on long-term debt 18,572 21,100 -------- ------- TOTAL CURRENT LIABILITIES 159,805 182,600 DEFERRED INCOME TAXES 14,421 14,514 OTHER DEFERRED LIABILITIES 19,449 19,198 ACCRUED EMPLOYEE AND RETIREE BENEFITS 38,672 38,100 LONG-TERM DEBT 169,695 160,678 SHAREHOLDERS' EQUITY: Common stock 2,698 2,698 Additional paid-in capital 78,749 78,955 Earnings reinvested in the business 321,846 314,883 -------- -------- 403,293 396,536 Less: Treasury stock, at cost 25,095 24,770 Other 13,341 9,986 -------- -------- 364,857 361,780 -------- -------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $766,899 $776,870 ======== ======== See Accompanying Notes to Consolidated Condensed Financial Statements. UNIVERSAL FOODS CORPORATION CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS ($000's Omitted Except Per Share Amounts) (Unaudited) Three Months Ended December 31 1995 1994 Revenue $193,446 $187,724 Cost of products sold 126,467 122,371 ------- ------- Gross profit 66,979 65,353 Selling and administrative expenses 41,995 42,229 Unusual item - gain on sale of Frozen Foods business --- (49,560) -------- --------- Operating income 24,984 72,684 Interest expense 3,906 3,968 -------- -------- Earnings before income taxes 21,078 68,716 Income taxes 7,588 33,134 -------- -------- Net earnings $ 13,490 $ 35,582 ======== ======== Weighted average number of common shares outstanding 26,103,000 26,061,000 ========== ========== Net earnings per common share $.52 $1.37 ==== ===== Dividends per common share $.25 $.24 ==== ==== See Accompanying Notes to Consolidated Condensed Financial Statements. UNIVERSAL FOODS CORPORATION CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS ($000's Omitted) (Unaudited) Three Months Ended December 31 1995 1994 Net cash provided by (used in) operating activities $ 13,292 $ (30,216) Cash flows from investing activities: Acquisition of property, plant and equipment (10,397) (9,150) Acquisition of new business - net of cash acquired (529) --- Proceeds from disposition of business and equipment --- 41,609 Other items, net 504 173 ------- ------- Net cash (used in) provided by investing activities (10,422) 32,632 Cash flows from financing activities: Proceeds from additional borrowings 50,032 28,856 Reductions in debt (47,717) (11,255) Other shareholders' equity transactions 315 269 Purchase of treasury stock (846) (1,759) Dividends paid (6,527) (6,257) -------- ------- Net cash (used in) provided by financing activities (4,743) 9,854 Net (decrease) increase in cash and cash equivalents (1,873) 12,270 Cash and cash equivalents at beginning of period 8,717 43,430 -------- -------- Cash and cash equivalents at end of period $ 6,844 $ 55,700 ======== ======== Supplemental Disclosure of Cash Flow Information: Cash paid during the period for: Interest $ 4,003 $ 3,979 Income taxes 3,216 34,254 See Accompanying Notes to Consolidated Condensed Financial Statements. UNIVERSAL FOODS CORPORATION NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS 1. In the opinion of the Company, the accompanying unaudited consolidated condensed financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the financial position as of December 31, 1995 and September 30, 1995, and the results of operations and cash flows for the three month periods ended December 31, 1995 and 1994. The results of operations for any interim period are not necessarily indicative of the results to be expected for the full fiscal year. 2. Refer to the footnotes in the Company's financial statements for the year ended September 30, 1995, for a description of the accounting policies, which have been continued without change, and additional details of the Company's financial condition. The details in those notes have not changed except as a result of normal transactions in the interim. 3. Expenses are charged to operations in the year incurred. However, for interim reporting purposes, certain of these expenses are charged to operations based on an estimate rather than as expenses are actually incurred. 4. During the three months ended December 31, 1995 and 1994, the Company repurchased 24,500 and 65,000 shares of common stock, respectively, for an aggregate price of $846,000 and, $1,759,000 respectively. 5. For the three months ended December 31, 1995, depreciation and amortization were $8,102,000 and $1,466,000, respectively. For the three months ended December 31, 1994, depreciation and amortization were $7,771,000 and $1,644,000, respectively. 6. On January 8, 1996, the Company issued two senior notes of $15,000,000 each, one bearing interest at 6.77%, due January 2010 and the other bearing interest at 6.68%, amortizing in seven equal principal payments beginning January 2005. Proceeds will be used for general corporate purposes. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS, FINANCIAL CONDITION AND FORWARD LOOKING INFORMATION RESULTS OF OPERATIONS: Revenue from operations was $193,446,000 during the three months ended December 31, 1995, compared with $187,724,000 a year ago. The revenue increase from the Color and Dehydrated operations was slightly offset by lower revenues in the Flavor Division as a result of eliminating some lower margin business. Gross profit margins remained relatively flat at 34.6% of revenue during the three months ended December 31, 1995 compared to 34.8% for the same period last year. The Company's continued focus on cost reduction resulted in a decrease of selling and administrative expenses to 21.7% of revenue during the three months ended December 31, 1995 compared to 22.5% for the same period last year. The effective income tax rate for the first three months of 1996 exceeded the 34% statutory rate primarily as a result of state income taxes. The effective income tax rate in 1995 exceeded 34% as a result of a higher than normal effective rate on the gain from the sale of the Frozen Foods business and state income taxes. FINANCIAL CONDITION: The current ratio increased to 2.0 at December 31, 1995, compared with 1.8 at September 30, 1995. Net working capital increased $12,367,000 to $156,131,000 at December 31, 1995 from $143,764,000 at September 30, 1995. Net cash provided by operating activities was $13,292,000 for the quarter ended December 31, 1995 compared to $30,216,000 used in operating activities for the quarter ended December 31, 1994. The use of cash in fiscal 1995 is primarily attributable to the tax payments as a result of the sale of the Frozen Foods business. Net cash used in investing activities was $10,422,000 for the three months ended December 31, 1995. Included in investing activities are capital additions of $10,397,000. The capital expenditure program reflects the Company's continuing commitment to maintain and enhance product quality, further automate and upgrade manufacturing processes, and expand the business through internal growth. Major projects in- process include construction of a new aroma chemical and fragrance facility in Spain and a BioProducts facility in France. Net cash used in financing activities was $4,743,000 for the quarter compared with $9,854,000 provided by financing in the comparable period last year. Proceeds from additional borrowings, including the $40,000,000 of senior notes relating to the debt agreement entered into in June 1995, were substantially offset by maturing obligations. In 1995, proceeds from new borrowings exceeded repayments by $17,601,000. Dividends of $6,527,000 were paid in the quarter. FORWARD LOOKING INFORMATION: Net earnings from the Company's continuing operations were up 10.5% for the first three months of fiscal 1996 compared with fiscal 1995. The Company continues to focus on profitability improvement as product categories are upgraded to more sophisticated flavorings and colors for foods and other applications. PART II OTHER INFORMATION Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS The Annual Meeting of Shareholders of Universal Foods Corporation was held on Thursday, January 25, 1996. At the meeting the following matters were voted upon by the Shareholders. 26,113,937 shares were entitled to vote at the meeting, and 23,692,154 shares (90.73%) were voted. The following persons were elected to a three year term as Directors of the Company: For Against James L. Forbes 23,287,741 404,413 James H. Keyes 23,292,918 399,236 Dr. Carol I. Waslien Ghazaii 23,270,035 422,119 The following persons continued in office as Directors in accordance with their previous election: Michael E. Batten John F. Bergstrom Leon T. Kendall Kenneth P. Manning Charles S. McNeer Guy A. Osborn William U. Parfet Essie Whitelaw The Shareholders ratified the appointment of Deloitte & Touche LLP, certified public accountants, as the independent auditors of the Company for 1996. Of the 26,113,937 shares entitled to vote at the meeting, 23,561,594 shares voted for ratification, 63,358 shares voted against ratification and 67,202 shares abstained. There were no broker non-votes at the Annual Meeting. Item 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibit 27 - Financial Data Schedule. (b) No reports on Form 8-K were required to be filed during the quarter ended December 31, 1995. 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. UNIVERSAL FOODS CORPORATION Date: February 13, 1996 By: /s/ Terrence M. O'Reilly Terrence M. O'Reilly, Vice President, Secretary and General Counsel Date: February 13, 1996 By: /s/ Michael L. Hennen Michael L. Hennen, Corporate Controller EXHIBIT INDEX Exhibit No. Description 27 Financial Data Schedule EX-27 2 EXHIBIT 27 FINANCIAL DATA SCHEDULE
5 THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS OF UNIVERSAL FOODS CORPORATION AS OF AND FOR THE THREE MONTHS ENDED DECEMBER 31, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 3-MOS SEP-30-1996 OCT-01-1995 DEC-31-1995 6,844 0 101,098 3,032 177,308 315,936 455,855 194,698 766,899 159,805 169,695 0 0 2,698 362,159 766,899 193,446 193,446 126,467 126,467 0 (237) 3,906 21,078 7,588 13,490 0 0 0 13,490 .52 .52
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