-----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, W2PGslsxjGOmpdJSdo2mzOr/KrtzMz/Qo72f6GPXTPOU52V7T5O28wza9w0JIoB3 znznDlEfnMbabr0DsxX1pQ== 0000043920-97-000010.txt : 19970929 0000043920-97-000010.hdr.sgml : 19970929 ACCESSION NUMBER: 0000043920-97-000010 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19970731 FILED AS OF DATE: 19970911 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: GREIF BROTHERS CORP CENTRAL INDEX KEY: 0000043920 STANDARD INDUSTRIAL CLASSIFICATION: PAPERBOARD CONTAINERS & BOXES [2650] IRS NUMBER: 314388903 STATE OF INCORPORATION: DE FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-00566 FILM NUMBER: 97678669 BUSINESS ADDRESS: STREET 1: 621 PENNSYLVANIA AVE CITY: DELAWARE STATE: OH ZIP: 43015 BUSINESS PHONE: 6143631271 MAIL ADDRESS: STREET 1: 621 PENNSYLVANIA AVE CITY: DELAWARE STATE: OH ZIP: 43015 FORMER COMPANY: FORMER CONFORMED NAME: GREIF BROTHERS COOPERAGE CORP DATE OF NAME CHANGE: 19690820 10-Q 1 U.S. SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended July 31, 1997 Commission File Number 1-566 GREIF BROS. CORPORATION (Exact name of registrant as specified in its charter) Delaware 31-4388903 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 425 Winter Road, Delaware, Ohio 43015 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code 614-549-6000 621 Pennsylvania Avenue, Delaware, Ohio (Former address, 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 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 stock, as of the close of the period covered by this report: Class A Common Stock 10,878,672 shares Class B Common Stock 12,001,793 shares EX-99.FINANCIALSTATE 2 CONSOLIDATED FINANCIAL STATEMENTS PART I. FINANCIAL INFORMATION GREIF BROS. CORPORATION AND SUBSIDIARY COMPANIES CONSOLIDATED STATEMENTS OF INCOME (Dollars in thousands, except per share amounts)
Three Months Nine Months Ended July 31, Ended July 31, 1997 1996 1997 1996 Net sales $167,062 $155,994 $471,961 $474,949 Other income: Interest and other 1,698 1,535 8,814 3,563 Gain on timber sales 3,781 3,084 7,378 6,081 172,541 160,613 488,153 484,593 Costs and expenses: Cost of products sold 144,869 128,865 411,119 389,460 Selling, general and administrative 19,275 16,116 54,299 50,882 Interest 1,063 196 2,736 710 165,207 145,177 468,154 441,052 Income before income taxes 7,334 15,436 19,999 43,541 Taxes on income 2,652 5,800 7,252 16,500 Net income $ 4,682 $ 9,636 $ 12,747 $ 27,041 Net income per share (based on the average number of shares outstanding during the period): Based on the assumption that earnings were allocated to Class A and Class B Common Stock to the extent that dividends were actually paid for the year and the remainder were allocated as they would be received by shareholders in the event of liquidation, that is, equally to Class A and Class B shares, share and share alike: Class A Common Stock $ .18 $ .40 $ .44 $1.08 Class B Common Stock $ .24 $ .44 $ .67 $1.27 Due to the special characteristics of the Company's two classes of stock (see Note 1), earnings per share can be calculated upon the basis of varying assumptions, none of which, in the opinion of management, would be free from the claim that it fails fully and accurately to represent the true interest of the shareholders of each class of stock and in the retained earnings. See accompanying Notes to the Consolidated Financial Statements.
GREIF BROS. CORPORATION AND SUBSIDIARY COMPANIES CONSOLIDATED BALANCE SHEETS (Dollars in thousands) ASSETS
July 31, October 31, 1997 1996 CURRENT ASSETS Cash and cash equivalents $ 15,378 $ 26,560 Canadian government securities 8,255 19,479 Trade accounts receivable--less allowance of $882 for doubtful items ($826 in 1996) 74,632 73,987 Inventories 54,635 49,290 Prepaid expenses and other 23,112 16,131 Total current assets 176,012 185,447 LONG TERM ASSETS Cash surrender value of life insurance 3,163 2,982 Goodwill -- less amortization 15,513 4,617 Other long term assets 12,426 7,116 31,102 14,715 PROPERTIES, PLANTS AND EQUIPMENT--at cost Timber properties--less depletion 6,204 6,112 Land 11,675 10,771 Buildings 131,473 125,132 Machinery, equipment, etc. 401,683 385,834 Construction in progress 58,007 33,450 Less accumulated depreciation (264,287) (249,123) 344,755 312,176 $551,869 $512,338 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $ 32,516 $ 31,609 Current portion of long term obligations 27,790 2,455 Accrued payrolls and employee benefits 6,935 8,989 Accrued taxes--general 1,433 1,949 Taxes on income 3,659 5,678 Total current liabilities 72,333 50,680 LONG-TERM OBLIGATIONS 38,504 22,748 OTHER LONG-TERM LIABILITIES 15,681 15,406 DEFERRED INCOME TAXES 26,768 22,872 Total long-term liabilities 80,953 61,026 SHAREHOLDERS' EQUITY (Note 1) Capital stock, without par value 9,192 9,034 Class A Common Stock: Authorized 32,000,000 shares; issued 21,140,960 shares; outstanding 10,878,672 shares (10,873,172 in 1996) Class B Common Stock: Authorized and issued 17,280,000 shares; outstanding 12,001,793 shares Treasury Stock, at cost (41,891) (41,867) Class A Common Stock: 10,262,288 shares (10,267,788 in 1996) Class B Common Stock: 5,278,207 shares Retained earnings 435,679 436,672 Cumulative translation adjustment (4,397) (3,207) 398,583 400,632 $551,869 $512,338 See accompanying Notes to the Consolidated Financial Statements.
GREIF BROS. CORPORATION AND SUBSIDIARY COMPANIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands)
For the nine months ended July 31, 1997 1996 Cash flows from operating activities: Net income $12,747 $27,041 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation, depletion and amortization 23,771 19,360 Deferred income taxes 3,907 4,786 Increase (decrease) in cash from changes in certain assets and liabilities, net of effects from acquisitions: Trade accounts receivable 6,181 14,081 Inventories (83) 17,700 Prepaid expenses and other (6,667) 2,207 Other long-term assets (4,786) 373 Accounts payable (3,065) (12,504) Accrued payrolls and employee benefits (2,437) (2,786) Accrued taxes - general (535) (238) Taxes on income (2,055) 4,267 Other long-term liabilities (1,929) 457 Net cash provided by operating activities 25,049 74,744 Cash flows from investing activities: Acquisitions of companies, net of cash acquired (7,514) (479) Net sales of investments in government securities 11,224 135 Purchase of properties, plants and equipment (34,464) (49,027) Net cash used by investing activities (30,754) (49,371) Cash flows from financing activities: Net proceeds (payments) on long-term debt 9,091 (2,548) Acquisition of treasury stock (24) -- Exercise of stock options 158 -- Dividends paid (13,740) (11,430) Net cash used by financing activities (4,515) (13,978) Foreign currency translation adjustment (962) (815) Net (decrease) increase in cash and cash equivalents (11,182) 10,580 Cash and cash equivalents at beginning of period 26,560 31,612 Cash and cash equivalents at end of period $15,378 $42,192 See accompanying Notes to the Consolidated Financial Statements.
EX-99.NOTES 3 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS GREIF BROS. CORPORATION AND SUBSIDIARY COMPANIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 1997 NOTE 1 - CAPITAL STOCK AND RETAINED EARNINGS Class A Common Stock is entitled to cumulative dividends of 1 cent a share per year after which Class B Common Stock is entitled to non-cumulative dividends up to 1/2 cent a share per year. Further distribution in any year must be made in proportion of 1 cent a share for Class A Common Stock to 1-1/2 cents a share for Class B Common Stock. The Class A Common Stock shall have no voting power nor shall it be entitled to notice of meetings of the stockholders, all rights to vote and all voting power being vested exclusively in the Class B Common Stock unless four quarterly cumulative dividends upon the Class A Common Stock are in arrears. There is no cumulative voting. NOTE 2 - DIVIDENDS PER SHARE The following dividends per share were paid during the period indicated:
Three Months Ended Nine Months Ended July 31, July 31, 1997 1996 1997 1996 Class A Common Stock $.12 $.08 $.48 $.40 Class B Common Stock $.18 $.12 $.71 $.59
NOTE 3 - CALCULATION OF NET INCOME PER SHARE Net income per share was calculated using the following number of shares for the periods presented: Three Months Ended Nine Months Ended July 31, July 31, Class A Common Stock 10,874,038 shares 10,873,461 shares Class B Common Stock 12,001,793 shares 12,001,793 shares NOTE 4 - INVENTORIES Inventories are comprised principally of raw materials and are stated at the lower of cost (principally on last-in, first-out basis) or market. NOTE 5 - ACQUISITIONS On May 9, 1997, the Company purchased all of the outstanding common stock of Independent Container, Inc., a corrugated container company, located in Louisville, Kentucky, Ferdinand, Indiana and Erlanger, Kentucky. On June 30, 1997, the Company acquired all of the outstanding common stock of Centralia Container, Inc., a corrugated container company, located in Centralia, Illinois. These acquisitions have been accounted for using the purchase method of accounting, and accordingly, the purchase price has been allocated to the assets purchased and liabilities assumed based upon the fair values at the date of acquisition. The excess of the purchase price over the fair values of the net assets acquired has been recorded as goodwill. The Consolidated Financial Statements include the operating results of each business from the date of acquisition. Pro forma results of operations have not been presented because the effect of these acquisitions were not significant. NOTE 6 - SUBSEQUENT EVENTS On August 4, 1997, the Company sold its wood component operations, which manufacture door panels, wood moldings and window and door parts, with locations in Kentucky, California, Washington and Oregon. At the present time, it is not expected that the transaction will have a material impact on the results of operations. NOTE 7 - RECLASSIFICATIONS Certain prior year amounts have been reclassified to conform to the 1997 presentation. MANAGEMENT'S DISCUSSION AND ANALYSIS Results of Operations Historically, revenues or earnings may or may not be representative of future operations because of various economic factors. The following comparative information is presented for the 9-month periods ended July 31, 1997 and July 31, 1996. Net sales decreased during the current period compared to the previous period primarily due to lower sales in the containerboard segment, which was significantly affected by lower sales prices of its products. The lower prices were caused by the continued weakness in the containerboard market resulting from excess capacity of containerboard. The sales price decreases were partially offset by the seven corrugated container plants which were acquired subsequent to the third quarter of 1996. The net sales of the shipping containers segment increased since the prior year due to the addition of two steel drum manufacturing plants during the second quarter of 1997. The increase in other income was primarily due to a gain on the sale of an office building and an injection molding facility during 1997. The cost of products sold as a percentage of sales increased from 82.0% in 1996 to 87.1% in 1997. This increase is primarily the result of lower net sales of the containerboard segment without a corresponding reduction in the cost of products sold. The increase in interest expense is due to more long-term obligations than the prior year. Liquidity and Capital Resources As indicated in the Consolidated Balance Sheet, elsewhere in this report and discussed in greater detail in the 1996 Annual Report to Shareholders, the Company is dedicated to maintaining a strong financial position. It is our belief that this dedication is extremely important during all economic times. As discussed in the 1996 Annual Report, the Company is subject to the economic conditions of the market in which it operates. During this period, the Company has been able to utilize its developed financial position to meet its continued business needs. The current ratio as of July 31, 1997 is an indication of the continuation of the Company's strong liquidity. Capital expenditures were $34,464,000, after eliminating the effect of the acquisitions, during the nine months ended July 31, 1997. These capital expenditures were principally needed to replace and improve equipment. In May 1997, the Company acquired the stock of Independent Container, Inc, a manufacturer of corrugated containers, located in Louisville, Kentucky, Ferdinand, Indiana and Erlanger, Kentucky. In June 1997, the Company purchased the stock of Centralia Container, Inc., a corrugated container company, located in Centralia, Illinois. The Company has approved future purchases, primarily for equipment, of approximately $11 million. Self-financing and borrowing has been the primary source for financing such capital expenditures. The increase in long-term obligations since year-end is primarily due to the purchase of three corrugated container companies, two steel drum operations, improvement related to Greif Board Corporation's machinery and equipment and other capital expenditures. Subsequent to July 1997, the Company sold its wood component operations, located in Kentucky, California, Washington and Oregon. These locations manufacture door panels, wood moldings and window and door parts. PART II. OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS There are no material developments with respect to pending legal proceedings. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a.) Exhibits. None. (b.) Reports on Form 8-K. No events occurred requiring Form 8-K to be filed. OTHER COMMENTS The information furnished herein reflects all adjustments which are, in the opinion of management, necessary for a fair presentation of the consolidated balance sheet as of July 31, 1997, the consolidated statements of income for the 9-month periods ended July 31, 1997 and 1996, and the consolidated statements of cash flows for the 9-month periods then ended. These financial statements are unaudited; however, at year-end an audit will be made for the fiscal year by our independent accountants. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Greif Bros. Corporation (Registrant) Date September 10, 1997 Joseph W. Reed Chief Financial Officer EX-27 4 ART.5 FDS FOR THE 3RD QUARTER FORM 10-Q
5 This schedule contains summary financial information extracted from the Form 10-Q and is qualified in its entirety by reference to such Form 10-Q. 1,000 9-MOS OCT-31-1997 JUL-31-1997 15,378 8,255 75,514 (882) 54,635 176,012 609,042 (264,287) 551,869 72,333 38,504 0 0 9,192 389,391 551,869 471,961 488,153 411,119 411,119 54,299 0 2,736 19,999 7,252 12,747 0 0 0 12,747 0.44 0.44 Amount represents the earnings per share for the Class A Common Stock. The earnings per share for the Class B Common Stock are $0.67.
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