-----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, BB3UI5xNcZtz6aFLwuh4h9li8PUj3japJMBvSjRpbLBUN/VHAi0tdrkzg+3Fxkzc Pss7DQ3Ii2iuoLPNjEo+Wg== 0000950110-96-000587.txt : 19960517 0000950110-96-000587.hdr.sgml : 19960517 ACCESSION NUMBER: 0000950110-96-000587 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960515 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERNATIONAL FLAVORS & FRAGRANCES INC CENTRAL INDEX KEY: 0000051253 STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL ORGANIC CHEMICALS [2860] IRS NUMBER: 131432060 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-04858 FILM NUMBER: 96564773 BUSINESS ADDRESS: STREET 1: 521 W 57TH ST CITY: NEW YORK STATE: NY ZIP: 10019 BUSINESS PHONE: 2127655500 MAIL ADDRESS: STREET 2: 521 W 57TH ST CITY: NEW YORK STATE: NY ZIP: 10019 FORMER COMPANY: FORMER CONFORMED NAME: VANAMERIGEN HAEBLER INC DATE OF NAME CHANGE: 19680426 10-Q 1 QUARTERLY REPORT SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended March 31, 1996 Commission file number 1-4858 INTERNATIONAL FLAVORS & FRAGRANCES INC. (Exact Name of Registrant as specified in its charter) New York 13-1432060 - ---------------------------------------------- ------------------- (State or other jurisdiction of incorporation (IRS Employer or organization) identification No.) 521 West 57th Street, New York, N.Y. 10019-2960 - ----------------------------------------- ------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (212) 765-5500 Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Sections 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding twelve 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 --- --- Number of shares outstanding as of May 6, 1996: 111,022,501 1 PART I. FINANCIAL INFORMATION Item 1. Financial Statements INTERNATIONAL FLAVORS & FRAGRANCES INC. CONSOLIDATED BALANCE SHEET (Dollars in thousands) 3/31/96 12/31/95 ---------- ---------- Assets Current Assets: Cash & Cash Equivalents ...................... $ 230,246 $ 251,430 Short-term Investments ....................... 54,882 45,503 Trade Receivables ............................ 294,164 253,913 Allowance For Doubtful Accounts .............. (8,027) (8,602) Inventories: Raw Materials ................... 228,101 233,759 Work in Process ................. 25,059 27,739 Finished Goods .................. 146,509 153,049 ---------- ---------- Total Inventories ............... 399,669 414,547 Other Current Assets ......................... 72,022 79,186 ---------- ---------- Total Current Assets ......................... 1,042,956 1,035,977 ---------- ---------- Property, Plant & Equipment, At Cost ........... 847,469 839,206 Accumulated Depreciation ....................... (375,751) (370,621) ---------- ---------- 471,718 468,585 Other Assets ................................... 30,325 29,707 ---------- ---------- Total Assets ................................... $1,544,999 $1,534,269 ========== ========== Liabilities and Shareholders' Equity Current Liabilities: Bank Loans ................................... $ 15,055 $ 12,185 Accounts Payable-Trade ....................... 63,215 63,282 Dividends Payable ............................ 37,754 37,749 Income Taxes ................................. 76,717 70,471 Other Current Liabilities .................... 79,870 92,714 ---------- ---------- Total Current Liabilities .................... 272,611 276,401 ---------- ---------- Other Liabilities: Deferred Income Taxes ........................ 13,596 13,420 Long-term Debt ............................... 10,283 11,616 Other ........................................ 117,252 116,272 ---------- ---------- Total Other Liabilities ........................ 141,131 141,308 ---------- ---------- Shareholders' Equity: Common Stock (115,761,840 shares issued in '96 and in '95) ......................... 14,470 14,470 Capital in Excess of Par Value ............... 141,447 142,476 Retained Earnings ............................ 1,097,831 1,069,421 Cumulative Translation Adjustment ............ 58,330 75,049 ---------- ---------- 1,312,078 1,301,416 Treasury Stock, at cost--4,702,539 shares in '96 and 4,808,005 in '95 ................ (180,821) (184,856) ---------- ---------- Total Shareholders' Equity ................... 1,131,257 1,116,560 ---------- ---------- Total Liabilities and Shareholders' Equity ..... $1,544,999 $1,534,269 ========== ========== See Notes to Consolidated Financial Statements 2 INTERNATIONAL FLAVORS & FRAGRANCES INC. CONSOLIDATED STATEMENT OF INCOME (Dollars in thousands except per share amounts) 3 Months Ended 3/31 ------------------------ 1996 1995 -------- -------- Net Sales ......................................... $382,767 $373,594 -------- -------- Cost of Goods Sold ................................ 204,071 190,784 Research and Development Expenses ................. 22,949 22,141 Selling and Administrative Expenses ............... 55,321 53,562 Interest Expense .................................. 546 565 Other (Income) Expense, Net ....................... (4,414) (4,500) -------- -------- 278,473 262,552 -------- -------- Income Before Taxes on Income ..................... 104,294 111,042 Taxes on Income ................................... 38,130 41,086 -------- -------- Net Income ........................................ $ 66,164 $ 69,956 ======== ======== Earnings Per Share ................................ $0.60 $0.63 Average Number of Shares Outstanding (000) ........ 111,000 111,531 Dividends Paid Per Share .......................... $0.34 $0.31 See Notes to Consolidated Financial Statements 3 INTERNATIONAL FLAVORS & FRAGRANCES INC. CONSOLIDATED STATEMENT OF CASH FLOWS (Dollars in thousands) 3 Months Ended 3/31 -------------------- 1996 1995 -------- -------- Cash Flows From Operating Activities: Net Income ............................................ $ 66,164 $ 69,956 Adjustments to Reconcile to Net Cash Provided by Operations: Depreciation ...................................... 11,660 9,724 Deferred Income Taxes ............................. 7,301 1,350 Changes in Assets and Liabilities: Current Receivables ............................. (42,780) (53,797) Inventories ..................................... 10,179 (21,384) Current Payables ................................ (5,168) 27,168 Other, Net ...................................... (341) (6,436) -------- -------- Net Cash Provided by Operations ....................... 47,015 26,581 -------- -------- Cash Flows From Investing Activities: Proceeds From Sales/Maturities of Short-term Investments .............................. 2,033 19,473 Purchases of Short-term Investments ................... (12,336) (25,051) Additions to Property, Plant & Equipment, Net of Minor Disposals ............................ (20,915) (18,059) -------- -------- Net Cash Used in Investing Activities ................. (31,218) (23,637) -------- -------- Cash Flows From Financing Activities: Cash Dividends Paid to Shareholders ................... (37,749) (34,554) Increase in Bank Loans ................................ 2,986 820 Decrease in Long-term Debt ............................ (998) (1,054) Proceeds From Issuance of Stock Under Stock Option Plans ........................................ 2,987 3,852 Purchase of Treasury Stock ............................ (96) 0 -------- -------- Net Cash Used In Financing Activities ................. (32,870) (30,936) -------- -------- Effect of Exchange Rate Changes on Cash and Cash Equivalents .................................... (4,111) 17,063 -------- -------- Net Change in Cash and Cash Equivalents ............... (21,184) (10,929) Cash and Cash Equivalents at Beginning of Year ........ 251,430 230,581 -------- -------- Cash and Cash Equivalents at End of Period ............ $230,246 $219,652 ======== ======== Interest Paid ......................................... $ 572 $ 717 Income Taxes Paid ..................................... $ 23,279 $ 27,121 See Notes to Consolidated Financial Statements 4 Note to Consolidated Financial Statements These interim statements and management's related discussion and analysis should be read in conjunction with the consolidated financial statements and their related notes, and management's discussion and analysis of results of operations and financial condition included in the Company's 1995 Annual Report to Shareholders. In the opinion of the Company's management, all normal recurring adjustments necessary for a fair statement of the results for the interim periods have been made. Item 2. Management's Discussion and Analysis of Results of Operations and Financial Condition Operations Worldwide net sales for the first quarter of 1996 increased 2% over the prior year to $382,767,000. The Company's first quarter sales reached a new high against a record performance in the first quarter of 1995. The sales increase in the first quarter of 1996 was not significantly affected by translation. Net income for the first quarter of 1996 totaled $66,164,000 compared to $69,956,000 in the prior year first quarter. Earnings per share for the quarter were $.60, as compared to $.63 in the prior year quarter. Sales and earnings were affected by slow reordering patterns for fragrances, resulting from sluggish retail sales during the 1995 holiday season, both in Europe and the United States. The resumption of normal fragrance reordering patterns, as well as the introduction of several new fragrance products, will result in stronger sales and earnings during the second half of the year. The percentage relationship of cost of goods sold and other operating expenses to sales for the first quarter 1996 and 1995 are as detailed below. First Quarter ------------------------ 1996 1995 ----- ----- Cost of Goods Sold 53.3% 51.1% Research and Development Expense 6.0% 5.9% Selling and Administrative Expense 14.5% 14.3% The effective tax rate for the first quarter 1996 was 36.6% as compared to 37.0% for the same period in 1995. The lower effective tax rate reflects the effects of lower tax rates in various tax jurisdictions in which the Company operates. Financial Condition The financial condition of the Company continued to be strong during the first quarter. Cash, cash equivalents and short-term investments totaled $285,128,000 at March 31, 1996. At March 31, 1996, working capital was $770,345,000 compared to $759,576,000 at December 31, 1995. Gross additions to property, plant and equipment during the first quarter of 1996 were $21,239,000. 5 In January 1996, the Company's cash dividend was increased 9.7% to an annual rate of $1.36 per share, and $.34 per share was paid to shareholders in the first quarter of 1996. The Company anticipates that its growth, capital expenditure programs and share repurchase program will be funded from internal sources. The cumulative translation adjustment component of Shareholders' Equity at March 31, 1996 was $58,330,000 compared to $75,049,000 at December 31, 1995. Changes in the component result from translating the net assets of the majority of the Company's foreign subsidiaries into U.S. dollars at current exchange rates as required by the Statement of Financial Accounting Standards No. 52 on accounting for foreign currency translation. 6 PART II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Exhibits Exhibit 27 - Financial Data Schedule (b) Reports on Form 8-K Registrant filed no report on Form 8-K during the quarter for which this report on Form 10-Q is filed. 7 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. INTERNATIONAL FLAVORS & FRAGRANCES INC. Dated: May 14, 1996 By:____________________________________________________ Thomas H. Hoppel, Vice-President and Chief Financial Officer Dated: May 14, 1996 By:____________________________________________________ Stephen A. Block, Vice-President Law and Secretary EX-27 2 FINANCIAL DATA SCHEDULE
5 The schedule contains summary financial information extracted from the Consolidated Balance Sheet & Consolidated Statement of Income and is qualified in its entirety by reference to such financial statements. Amounts in thousands of dollars, except per share amounts. 1000 3-MOS DEC-31-1996 MAR-31-1996 230,246 54,882 294,164 (8,027) 399,669 1,042,956 847,469 (375,751) 1,544,999 272,611 10,283 14,470 0 0 1,116,787 1,544,999 382,767 382,767 204,071 282,341 (4,414) 0 546 104,294 38,130 66,164 0 0 0 66,164 $0.60 $0.60
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