-----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, Hh9YVVlIgG+IJyuNItRHya8d7W2uuQnlZVHtjB6mE9ZC+inKTqNsWKrE8cjTFzP7 i3bvFEOi1lCs2Hlp9796Tg== 0000310354-96-000002.txt : 19960213 0000310354-96-000002.hdr.sgml : 19960213 ACCESSION NUMBER: 0000310354-96-000002 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19951231 FILED AS OF DATE: 19960212 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: STANDEX INTERNATIONAL CORP/DE/ CENTRAL INDEX KEY: 0000310354 STANDARD INDUSTRIAL CLASSIFICATION: REFRIGERATION & SERVICE INDUSTRY MACHINERY [3580] IRS NUMBER: 310596149 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-07233 FILM NUMBER: 96515228 BUSINESS ADDRESS: STREET 1: 6 MANOR PKWY CITY: SALEM STATE: NH ZIP: 03079 BUSINESS PHONE: 6038939701 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Quarterly Report under Section 13 or 15(d) of the Securities Exchange Act of 1934 For Quarter Ended December 31, 1995 Commission file number 1-7233 Standex International Corporation (Exact name of Registrant as specified in its charter) Delaware 31-0596149 (State or other jurisdiction of (I.R.S. Employer Identification Number) incorporation or organization) 6 Manor Parkway, Salem, New Hampshire 03079 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (603) 893-9701 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 report), and (2) has been subject to such filing requirements for the past 90 days. Yes X . No . The number of shares of Registrant's Common Stock outstanding on December 31, 1995 was 13,853,222. STANDEX INTERNATIONAL CORPORATION I N D E X Page No. PART I. FINANCIAL INFORMATION: Statements of Consolidated Income for the Three and Six Months Ended December 31, 1995 and 1994 ................. 2 Consolidated Balance Sheet, December 31, 1995 and June 30, 1995 ........................................... 3 Statement of Consolidated Cash Flows for the Six Months Ended December 31, 1995 and 1994 ........................ 4 Notes to Financial Information. ........................... 5 Management's Discussion and Analysis....................... 6-8 PART II. OTHER INFORMATION.................................. 9 Form 10-Q PART I. FINANCIAL INFORMATION STANDEX INTERNATIONAL CORPORATION Statement of Consolidated Income (000 Omitted)
Three Months Ended Six Months Ended December 31 December 31 Net Sales $154,101 $143,937 $296,336 $284,528 Cost of Products Sold 102,675 93,412 197,624 188,048 Gross Profit Margin 51,426 50,525 98,712 96,480 Selling, General & Adminis- trative Expenses 34,872 35,125 65,191 65,499 Income from Operations 16,554 15,400 33,521 30,981 Other Income/(Expense): Net gain on Disposition of Businesses and Product Lines - 346 - 5,426 Interest Expense (2,513) (1,951) (4,696) (3,804) Interest Income 120 160 242 279 Other Income/(Expense) - net (2,393) (1,445) (4,454) 1,901 Income Before Income Taxes 14,161 13,955 29,067 32,882 Provision for Income Taxes 4,984 4,929 10,580 12,055 Net Income $ 9,177 $ 9,026 $ 18,487 $ 20,827 Earnings Per Share $ .65 $ .62 $ 1.31 $ 1.42 Cash Dividends per Share $ .18 $ .16 $ .35 $ .30
STANDEX INTERNATIONAL CORPORATION Consolidated Balance Sheet (000 Omitted)
December 31 June 30 1995 1995 ASSETS CURRENT ASSETS: Cash $ 5,951 $ 9,543 Receivables, net of allowances for doubtful accounts 91,961 90,492 Inventories (approximately 40% finished goods, 25% work in process, and 35% raw material and supplies) 110,055 116,417 Prepaid expenses 6,876 3,895 Total current assets 214,843 220,347 PROPERTY, PLANT AND EQUIPMENT 217,123 210,139 Less accumulated depreciation 129,406 125,611 Total 87,717 84,528 OTHER ASSETS Goodwill, net 15,063 15,297 Prepaid pension and other 24,448 22,530 Total 39,511 37,827 TOTAL $342,071 $342,702 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Notes payable and current portion of long-term debt $ 2,054 $ 3,321 Accounts payable 32,656 36,414 Income taxes 4,508 4,472 Accrued expenses 33,201 33,005 Total current liabilities 72,419 77,212 LONG-TERM DEBT (less current portion included above) 111,265 111,845 DEFERRED INCOME TAXES AND OTHER LIABILITIES 17,902 21,293 STOCKHOLDERS' EQUITY Common stock 41,976 41,976 Paid-in Capital 2,740 2,129 Retained earnings 289,632 276,031 Cumulative translation adjustment 1,025 338 Less cost of treasury shares (194,888) (188,122) Total stockholders' equity 140,485 132,352 TOTAL $342,071 $342,702
INTERNATIONAL CORPORATION Statement of Consolidated Cash Flows (000 Omitted)
Six Months Ended December 31 1995 1994 Cash Flows from Operating Activities: Net income $ 18,487 $ 20,827 Depreciation and amortization 6,059 6,040 Net gain on dispositions of business and product lines - (5,426) Net changes in assets and liabilities (6,685) (5,261) Net Cash Provided by Operating Activities 17,861 16,180 Cash Flows from Investing Activities: Expenditures for property and equipment (8,764) (7,090) Proceeds from dispositions of businesses - 13,589 Other 86 123 Net Cash (Used for)/Provided by Investing Activities (8,678) 6,622 Cash Flows from Financing Activities: Proceeds from additional borrowings 50,000 7,495 Net Payments of debt (51,846) (13,391) Cash dividends paid (4,886) (4,332) Purchase of treasury stock (7,721) (11,014) Other, net 1,566 1,336 Net Cash Used for Financing Activities (12,887) (19,906) Effect of Exchange Rate Changes on Cash 112 433 Net Change in Cash and Cash Equivalents (3,592) 3,329 Cash and Cash Equivalents at Beginning of Year 9,543 5,023 Cash and Cash Equivalents at December 31 $ 5,951 $ 8,352 Supplemental Disclosure of Cash Flow Information: Cash paid during the six months for: Interest 4,069 3,565 Income taxes 10,544 10,682
NOTES TO FINANCIAL INFORMATION 1. Management Statement The financial statements as reported in Form 10-Q reflect all adjustments (including those of a normal recurring nature) which are, in the opinion of management, necessary to a fair statement of results for the three and six months ended December 31, 1995 and 1994. 2. Per Share Calculation Shares (in thousands) used in per share data are as follows: December 31 1995 1994 Earnings 14,164 14,717 Cash Dividends 13,960 14,438 Earnings per share have been computed according to generally accepted accounting principles. Cash dividends per share have been computed based on the shares outstanding at the time the dividends were paid. 3. Contingencies The Company is a party to various claims and legal proceedings related to environmental matters generally incidental to its business. Management has evaluated each matter based, in part, upon the advice of its independent environmental consultants and has recorded an appropriate provision for the resolution of such matters in accordance with Statement of Financial Accounting Standards (SFAS) No. 5, "Accounting for Contingencies." Management believes that such provision is sufficient to cover any future payments, including legal costs, under such proceedings. 4. Additional Borrowings In September, the Company negotiated a $50,000,000 unsecured loan agreement with an institutional lender. The loan has a fixed interest rate of 7.13% and is repayable in level, annual principal payments beginning September, 1999 and ending September, 2005. The financial covenants of the new loan agreement are similar to those under the Company's revolving credit agreement. The proceeds of the loan were used to reduce borrowings under the revolving credit agreement. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS MATERIAL CHANGES IN FINANCIAL CONDITION During the six months ended December 31, 1995, the Company negotiated a $50 million unsecured loan agreement with an institutional lender. The loan has a fixed interest rate of 7.13% and is repayable in level, annual principal payments beginning September, 1999 and ending September, 2005. The financial covenants of the new loan agreement are similar to those under the Company's revolving credit agreement. Net Income of $18.5 million and the proceeds from the new loan agreement were used to reduce borrowings under the Company's revolving credit agreement, fund operating activities, invest $8.8 million in plant and equipment, purchase $7.7 million of the Company's Common Stock and pay out $4.9 million of cash dividends to the Company's shareholders. The Company believes that existing cash flows, along with current credit and loan agreements, are sufficient to meet its anticipated cash requirements for the foreseeable future. In October 1995, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards (SFAS) No. 123, "Accounting for Stock-Based Compensation." Although this standard will require additional disclosure within the Company's financial statements, it will not affect the Company's financial condition or operating results. OPERATIONS Quarter Ended December 31, 1995 as compared to the Quarter Ended December 31, 1994 Net Sales reached record levels for the quarter ended December 31, 1995. As compared to the same quarter of fiscal 1995, Net Sales rose $10.2 million. In the latter portion of the prior fiscal year, a number of divisions raised sales prices to help offset material price increases. Although it is difficult to quantify the impact of the sales price increases on Net Sales, management believes the majority of the growth in Net Sales is due to growth in unit volumes. In addition, although changes in the average foreign exchange rates from December 31, 1994 to December 31, 1995 have had a positive impact on Net Sales during the quarter, the total effect was not significant. The Company has experienced some softening in domestic business. However, all three of the Company's segments reported growth in Net Sales due mainly to improvements in customer demand reported by the foreign divisions. The Graphics/Mail Order segment registered an increase in Net Sales of $4.5 million with the Institutional segment reporting growth of $3.2 million. Net Sales for the Industrial segment rose $2.5 million. OPERATIONS (Continued) The Gross Profit Margin Percentage declined 1.7% from 35.1% reported in the second quarter of fiscal 1995 to 33.4% for the three months ended December 31, 1995. All three segments registered a modest decline in the Gross Profit Margin Percentage due to higher material costs at some units along with a few instances of increased competitive pressures on pricing. Selling, General and Administrative Expenses (SG&A) decreased slightly for the three months ended December 31, 1995 when compared to the same period of fiscal 1995. All three segments reported only slight increases and decreases in SG&A, none of which was individually significant. Interest Expense rose 28.8%, or $562,000, as compared to the second quarter of fiscal 1995 due to higher interest rates than those experienced during the same period of the prior year. The above factors resulted in a $205,000, or 1.5%, increase in Income Before Income Taxes as compared to the same period of the prior year. The effective tax rate for the quarter ended December 31, 1995 is equal to that reported in the same period of fiscal 1995. Net Income for the second quarter of fiscal 1996 rose $151,000, or 1.7%, over the same quarter last year due to the factors described above. Six Months Ended December 31, 1995 as compared to the Six Months Ended December 31, 1994 Net Sales for the six months ended December 31, 1995 reached record levels. An increase in Net Sales of $11.8 million was reported. As indicated in the discussion of quarterly results, management believes the majority of this growth is related to increases in unit volumes. Also, the effect of changes in average foreign exchange rates on operating results was not significant. Net Sales for the Institutional and Graphics/Mail Order segments rose $7.3 and $5.4 million, respectively, for the reasons described in the discussion of quarterly results. Despite gains reported by several foreign divisions within the Industrial segment, a slight decline in Net Sales was reported due to the sale of a German subsidiary in the first quarter of the prior fiscal year. The Gross Profit Margin Percentage for the six month period declined modestly from 33.9% for the same period of fiscal 1995 to 33.3% for the six months ended December 31, 1995. All three segments registered slight declines in the Gross Profit Margin Percentage, none of which was individually significant. Selling, General and Administrative Expenses (SG&A) declined slightly for the six months ended December 31, 1995 when compared to the same period of fiscal 1995. All three segments reported only slight increases and decreases in SG&A, none of which was individually significant. OPERATIONS (Continued) Interest Expense rose 23.4%, or $892,000, for the six months ended December 31, 1995 due to higher interest rates than those experienced in the same period of the prior fiscal year. During the six months ended December 31, 1994, a net gain of $5.4 million was reported due to the disposition of certain businesses and product lines. This prior year gain, in addition to the factors described above, resulted in a $3.8 million decrease in Income Before Income Taxes for the six months ended December 31, 1995. The effective tax rate for the six months ended December 31, 1995 is slightly less than that reported in the same period of fiscal 1995. Due to the factors described above, Net Income for the six months ended December 31, 1995 decreased $2.3 million, or 11.2%, over the same period of the prior year. PART II. OTHER INFORMATION ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. The Annual Meeting of Shareholders of the Company was held on October 31, 1995. Two matters were voted upon at the meeting: the election of directors and the approval of the appointment of independent auditors of the Company. The name of each director elected at the meeting and the number of votes cast as to each matter are as follows:
Proposal 1 (Election of Directors) Nominee For Withheld William L. Brown 11,221,858 145,941 Thomas L. King 11,113,062 254,737 Sol Sackel 11,187,755 180,044 Lindsay M. Sedwick 11,112,506 255,293
Proposal 2 (Appointment of Auditors) For Against Abstain 11,306,783 14,516 46,500
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits 27. Financial Data Schedule (b) Reports on Form 8-K The Company filed no reports on Form 8-K with the Securities and Exchange Commission during the quarter ended December 31, 1995. ALL OTHER ITEMS ARE INAPPLICABLE Form 10-Q STANDEX INTERNATIONAL CORPORATION 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. STANDEX INTERNATIONAL CORPORATION Date: February 12, 1996 /s/ Robert R. Kettinger Robert R. Kettinger, Corporate Controller Date: February 12, 1996 /s/ Lindsay M. Sedwick Lindsay M. Sedwick, Senior Vice President of Finance/CFO EX-27 2
5 6-MOS JUN-30-1996 DEC-31-1995 5,951 0 94,987 3,025 110,054 214,843 217,123 129,406 342,071 72,419 111,265 0 0 41,976 98,509 140,485 296,336 296,578 197,624 197,624 0 0 4,696 29,067 10,580 0 0 0 0 18,487 1.31 0
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