-----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, VcIEND7tJvIjqnHl114vCD6ni2VWQSPBT1+JOoT8ceKJGKif5x9j12WYWWzeQ4hG Y0hzhtCLJVX9UDTFatM/qQ== 0001045969-00-000357.txt : 20000515 0001045969-00-000357.hdr.sgml : 20000515 ACCESSION NUMBER: 0001045969-00-000357 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20000401 FILED AS OF DATE: 20000512 FILER: COMPANY DATA: COMPANY CONFORMED NAME: JOSTENS INC CENTRAL INDEX KEY: 0000054050 STANDARD INDUSTRIAL CLASSIFICATION: JEWELRY, PRECIOUS METAL [3911] IRS NUMBER: 410343440 STATE OF INCORPORATION: MN FISCAL YEAR END: 0102 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-05064 FILM NUMBER: 628613 BUSINESS ADDRESS: STREET 1: 5501 NORMAN CTR DR CITY: MINNEAPOLIS STATE: MN ZIP: 55437 BUSINESS PHONE: 6128303300 MAIL ADDRESS: STREET 1: 5501 NORMAN CENTER DRIVE CITY: MINNEAPOLIS STATE: MN ZIP: 55437 10-Q 1 FORM 10-Q UNITED STATES 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 April 1, 2000 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 1-5064 Jostens, Inc. - -------------------------------------------------------------------------------- (Exact name of Registrant as specified in its charter) Minnesota 41-0343440 - ------------------------------- --------------------------------------- (State or other jurisdiction of (I.R.S. Employer Identification number) incorporation or organization) 5501 Norman Center Drive, Minneapolis, Minnesota 55437 - ------------------------------------------------ -------------------------- (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code: (952) 830-3300 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 [_] On May 1, 2000 there were 33,347,250 shares of the Registrant's common stock outstanding. JOSTENS, INC. AND SUBSIDIARIES Part I Financial Information Page - ---------------------------- ---- Item 1. Financial Statements Condensed Consolidated Statements of Operations for the Three months ended April 1, 2000 and April 3, 1999 3 Condensed Consolidated Balance Sheets as of April 1, 2000, April 3, 1999 and January 1, 2000 4 Condensed Consolidated Statements of Cash Flows for the Three months ended April 1, 2000 and April 3, 1999 5 Notes to Condensed Consolidated Financial Statements 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 9 Item 3. Quantitative and Qualitative Disclosures about Market Risk 14 Part II Other Information - ------------------------- Item 1. Legal Proceedings 15 Item 4. Submission of Matters to a Vote of Security Holders 15 Item 6. Exhibits and Reports on Form 8-K 15 Signatures 16 2 PART I FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS JOSTENS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) Three months ended --------------------------- April 1 April 3 In thousands, except per-share data 2000 1999 - ------------------------------------------------------------------------------ Net sales $174,589 $166,358 Cost of products sold 66,586 68,499 - ------------------------------------------------------------------------------ Gross profit 108,003 97,859 Selling and administrative expenses 87,253 83,302 - ------------------------------------------------------------------------------ Operating income 20,750 14,557 Net interest expense 1,727 1,039 - ------------------------------------------------------------------------------ Income before income taxes 19,023 13,518 Income taxes 7,704 5,475 - ------------------------------------------------------------------------------ Net income $ 11,319 $ 8,043 ============================================================================== Earnings per common share Basic $0.34 $0.23 Diluted $0.34 $0.23 Weighted average common shares outstanding Basic 33,263 34,816 Diluted 33,451 34,950 Cash dividends declared per common share $0.22 $0.22 See accompanying notes to condensed consolidated financial statements. 3 JOSTENS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) -------------------------------- April 1 April 3 January 1 In thousands, except per-share data 2000 1999 2000 - ------------------------------------------------------------------------------------------------------------------------ ASSETS Current assets Cash and cash equivalents $14,278 $5,206 $ 38,517 Accounts receivable, net of allowance of $6,405, $6,479 and $5,775, respectively 132,253 128,852 107,638 Inventories 109,619 122,962 87,839 Deferred income taxes 17,400 14,682 17,400 Salespersons overdrafts, net of allowance of $6,354, $7,045 and $6,332, respectively 24,220 21,026 26,194 Prepaid expenses and other current assets 9,848 6,255 8,721 - ------------------------------------------------------------------------------------------------------------------------ Total current assets 307,618 298,983 286,309 Other Assets Intangibles, net 18,629 27,616 18,895 Other 18,918 9,460 17,872 - ------------------------------------------------------------------------------------------------------------------------ Total other assets 37,547 37,076 36,767 Property and equipment 273,942 263,599 271,790 Less accumulated depreciation (193,192) (173,508) (187,150) - ------------------------------------------------------------------------------------------------------------------------ Property and equipment, net 80,750 90,091 84,640 - ------------------------------------------------------------------------------------------------------------------------ $425,915 $426,150 $407,716 ======================================================================================================================== LIABILITIES AND SHAREHOLDERS' INVESTMENT Current liabilities Short-term borrowings $ 74,960 $ 96,910 $117,608 Accounts payable 24,443 25,670 23,641 Employee compensation 25,234 22,731 29,478 Commissions payable 42,281 38,277 26,134 Customer deposits 155,826 146,672 112,958 Income taxes 22,725 8,471 17,223 Other accrued liabilities 27,007 21,907 30,100 - ------------------------------------------------------------------------------------------------------------------------ Total current liabilities 372,476 360,638 357,142 Other noncurrent liabilities 12,578 19,871 14,064 - ------------------------------------------------------------------------------------------------------------------------ Total liabilities 385,054 380,509 371,206 Commitments and contingencies Shareholders' investment Preferred shares, $1.00 par value: authorized 4,000 shares, none issued -- -- -- Common shares, $.33 1/3 par value: authorized 100,000 shares, issued April 1, 2000 - 33,339; April 3, 1999 - 34,506; January 1, 2000 - 33,324 11,113 11,502 11,108 Retained earnings 35,418 41,653 31,072 Accumulated other comprehensive loss (5,670) (7,514) (5,670) - ------------------------------------------------------------------------------------------------------------------------ Total shareholders' investment 40,861 45,641 36,510 - ------------------------------------------------------------------------------------------------------------------------ $425,915 $426,150 $407,716 ========================================================================================================================
See accompanying notes to condensed consolidated financial statements. 4 JOSTENS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Three months ended ---------------------------------- April 1 April 3 In thousands 2000 1999 - ---------------------------------------------------------------------------------------------- Operating activities Net income $ 11,319 $ 8,043 Depreciation 6,313 5,823 Amortization 268 549 Changes in assets and liabilities Accounts receivable (24,615) (22,505) Inventories (21,780) (32,468) Salespersons overdrafts 1,974 (337) Prepaid expenses and other current assets (1,127) (518) Accounts payable (3,712) 2,526 Employee compensation (4,244) (4,829) Commissions payable 16,147 16,146 Customer deposits 42,868 54,580 Income taxes 5,502 3,758 Other (4,631) (2,148) - ---------------------------------------------------------------------------------------------- Net cash provided by operating activities 24,282 28,620 - ---------------------------------------------------------------------------------------------- Investing activities Purchases of property and equipment (2,711) (7,267) Equity investments (1,103) -- Other 395 13 - ---------------------------------------------------------------------------------------------- Net cash used for investing activities (3,419) (7,254) - ---------------------------------------------------------------------------------------------- Financing activities Net short-term borrowings (repayments) (38,134) 2,450 Dividends paid (7,331) (7,716) Proceeds from exercise of stock options 363 1,527 Repurchases of common stock -- (15,016) - ---------------------------------------------------------------------------------------------- Net cash used for financing activities (45,102) (18,755) - ---------------------------------------------------------------------------------------------- Change in cash and cash equivalents (24,239) 2,611 Cash and cash equivalents, beginning of period 38,517 2,595 - ---------------------------------------------------------------------------------------------- Cash and cash equivalents, end of period $ 14,278 $ 5,206 ==============================================================================================
See accompanying notes to condensed consolidated financial statements. 5 JOSTENS, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 1. Basis of Presentation We prepared our accompanying unaudited condensed consolidated financial statements following the requirements of the Securities and Exchange Commission (SEC) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by generally accepted accounting principles can be condensed or omitted. Therefore, we suggest that these financial statements be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended January 1, 2000 ("1999 Form 10-K"). Revenues, expenses, assets and liabilities can vary during each quarter of the year. Therefore, the results and trends in these interim financial statements may not be the same as those for the full year. In our opinion, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of normal recurring items, considered necessary to present fairly, when read in conjunction with the 1999 Form 10-K, our financial position, results of operations and cash flows for the periods presented. 2. Earnings Per Common Share Basic earnings per share are computed by dividing net income by the weighted average number of common shares outstanding. Diluted earnings per share are computed by dividing net income by the average number of common shares outstanding, including the dilutive effects of options, restricted stock and contingently issuable shares. Unless otherwise noted, references are to diluted earnings per share. Basic and diluted earnings per share were calculated using the following: Three months ended -------------------- April 1 April 3 In thousands, except per-share data 2000 1999 --------------------------------------------------------------------------- Weighted average common shares outstanding - basic 33,263 34,816 Dilutive shares 188 134 --------------------------------------------------------------------------- Weighted average common shares outstanding - diluted 33,451 34,950 =========================================================================== Net income for basic and diluted earnings per share $11,319 $8,043 Earnings per share - basic $0.34 $0.23 Earnings per share - diluted $0.34 $0.23 6 JOSTENS, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)--(CONTINUED) 3. Special Charge During the fourth quarter of 1999, we recorded a special charge of $20.2 million. Cash outlays associated with the charge were $1.2 million in the first quarter of 2000. The components of the special charge and utilization in 1999 and the first three months of 2000 are as follows:
Utilization ---------------------- Three months Initial ended Balance In thousands accrual 1999 April 1, 2000 April 1, 2000 ------------------------------------------------------------------------------------------------- Employee termination benefits $ 4,910 $ -- $1,047 $3,863 Abandonment of internal use software under development 6,455 6,245 -- 210 Write-off of impaired goodwill related to retail class ring sales channel 4,560 4,560 -- -- Write-off of goodwill related to exiting the college alumni direct marketing business 3,086 3,086 -- -- Other costs related to exiting the college alumni direct marketing business 1,183 270 154 759 ------------------------------------------------------------------------------------------------- $20,194 $14,161 $1,201 $4,832 =================================================================================================
We expect to complete restructuring activities and utilize the remaining charge by the end of 2000. As a result of the special charge, the work force will be reduced by about 100 personnel, primarily in corporate staff and executive functions and in our college alumni direct marketing business. Cumulative terminations were 65 at April 1, 2000. 4. Inventories Inventories were comprised of the following: April 1 April 3 January 1 In thousands 2000 1999 2000 --------------------------------------------------------------------- Raw material and supplies $ 17,021 $ 27,305 $ 17,886 Work-in-process 60,921 61,762 29,772 Finished goods 31,677 33,895 40,181 --------------------------------------------------------------------- Total inventories $109,619 $122,962 $87,839 ===================================================================== 7 JOSTENS, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)--(CONTINUED) 5. Comprehensive Income Comprehensive income and its components, net of tax, are as follows: Three months ended ------------------------------ April 1 April 3 In thousands 2000 1999 --------------------------------------------------------------------------- Net income $11,319 $8,043 Change in cumulative translation adjustment -- 251 --------------------------------------------------------------------------- Comprehensive income $11,319 $8,294 =========================================================================== 6. Business Segments Financial information by reportable business segment is included in the following summary: Three months ended ------------------------------- April 1 April 3 In thousands 2000 1999 ----------------------------------------------------------------------- Net Sales From External Customers School Products $151,442 $142,788 Recognition 21,071 21,598 Other 2,076 1,972 ----------------------------------------------------------------------- Consolidated $174,589 $166,358 ======================================================================= Operating Income School Products $ 28,411 $ 24,458 Recognition (308) 129 Other (7,353) (10,030) ----------------------------------------------------------------------- Consolidated 20,750 14,557 Net interest expense 1,727 1,039 ----------------------------------------------------------------------- Income before income taxes $ 19,023 $ 13,518 ======================================================================= 7. Subsequent Event On May 9, 2000, our shareholders approved the merger and the Merger Agreement between Jostens, Inc. and Saturn Acquisition Corporation. 8 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Our disclosure and analysis in this report may contain some "forward-looking statements". Forward-looking statements give our current expectations or forecasts of future events. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," "expected," "intend," "estimate," "anticipate," "believe," "project," or "continue," or the negative thereof or similar words. From time to time, we also may provide oral or written forward-looking statements in other materials we release to the public. Any or all of our forward-looking statements in this report and in any public statements we make may turn out to be wrong. They can be affected by inaccurate assumptions we might make or by known or unknown risks or uncertainties. Consequently, no forward-looking statements can be guaranteed. Actual results may vary materially. Investors are cautioned not to place undue reliance on any forward-looking statements. Investors should also understand that it is not possible to predict or identify all such factors and should not consider the following list to be a complete statement of all potential risks and uncertainties. Any change in the following factors may impact the achievement of results: o the merger with Saturn Acquisition Corporation; o our ability to achieve the intended benefits of our corporate restructuring announced in the fourth quarter of 1999; o our relationship with our independent and employee sales representatives; o material litigation cases we are currently involved which, if decided against us, may adversely affect our financial results; o environmental regulations that could impose substantial costs upon us and may adversely affect our financial results; o the fluctuating prices of raw materials, primarily gold; o the seasonality of our School Products segment sales and operating income; o our dependence on a key supplier for our synthetic and semiprecious stones; and o fashion and demographic trends. The foregoing factors are not exhaustive, and new factors may emerge or changes to the foregoing factors may occur that would impact our business. 9 RESULTS OF OPERATIONS The following table sets forth selected information from our Condensed Consolidated Statements of Operations.
Three months ended ---------------------------------- April 1 April 3 Dollars in thousands 2000 1999 $ change % change - ---------------------------------------------------------------------------------------------------------------------------------- Net sales $174,589 $166,358 $ 8,231 4.9% % of net sales 100.0% 100.0% Cost of products sold 66,586 68,499 (1,913) (2.8%) % of net sales 38.1% 41.2% - ---------------------------------------------------------------------------------------------------------------------------------- Gross profit 108,003 97,859 10,144 10.4% % of net sales 61.9% 58.8% Selling and administrative expenses 87,253 83,302 3,951 4.7% % of net sales 50.0% 50.1% - ---------------------------------------------------------------------------------------------------------------------------------- Operating income 20,750 14,557 6,193 42.5% % of net sales 11.9% 8.8% Net interest expense 1,727 1,039 688 66.2% % of net sales 1.0% 0.6% - ---------------------------------------------------------------------------------------------------------------------------------- Income before income taxes 19,023 13,518 5,505 40.7% % of net sales 10.9% 8.1% Income taxes 7,704 5,475 2,229 40.7% % of net sales 4.4% 3.3% - ---------------------------------------------------------------------------------------------------------------------------------- Net income $11,319 $8,043 $3,276 40.7% ================================================================================================================================== % of net sales 6.5% 4.8%
Percentages in this table may reflect rounding adjustments. Net sales The components of the net sales increase were: % change from 1999 first quarter ------------------------------------------------------------- Price/Mix 2.0% Volume 2.8% Currency 0.1% ------------------------------------------------------------- Total net sales increase 4.9% ============================================================= 10 Net sales for the first quarter by segment and the changes from last year were as follows: Three months ended ----------------------------- April 1 April 3 In thousands 2000 1999 $ change % change - ------------------------------------------------------------------------------- School Products $151,442 $142,788 $8,654 6.1% Recognition 21,071 21,598 (527) (2.4%) Other 2,076 1,972 104 5.3% - ------------------------------------------------------------------------------- Consolidated $174,589 $166,358 $8,231 4.9% =============================================================================== o School Products sales increased primarily due to shorter production cycle times which allowed for earlier shipments of yearbooks and graduation products during the first quarter of 2000 compared with the prior year. These increases were offset by accelerated jewelry shipments in the fourth quarter of 1999 due to improved manufacturing efficiencies compared with the prior year, and a decline in commercial printing volume. o Recognition sales decreased primarily due to a change in product mix from jewelry to brand name merchandise. Gross Profit Gross margin for the three months ended April 1, 2000 was 61.9 percent, compared with 58.8 percent for the comparable period in 1999. The increase in gross margin was primarily due to: o favorable mix and price increases; o shorter production cycle times which allowed for earlier shipments of higher margin graduation products during the first quarter of 2000 compared with the prior year; o manufacturing efficiencies in our School Products segment in 2000; and o a $1.5 million charge in the first quarter of 1999 to close a facility in Mexico and realign all Jewelry operations in the United States. These increases were partially offset by: o a decline in Recognition segment sales due to a change in product mix from jewelry to brand name merchandise. Selling and Administrative Expenses Selling and administrative expenses increased 4.7 percent in the first quarter of 2000 over the prior year period. The increase reflects: o higher commission expense in 2000 due to increased sales; o higher selling expense in 2000 related to programs and initiatives intended to increase our sales; o higher bad debt expense in 2000; and o higher information system expense, primarily for depreciation. These increases were partially offset by: o lower amortization expense in 2000 related to our write-off of goodwill as part of the 1999 special charge; 11 o lower selling and administrative expenses as a result of exiting the college alumni direct marketing business in the fourth quarter of 1999; o reduced spending on temporary labor in our Recognition segment in 2000 compared with 1999 as we prepared for a system implementation in the first quarter of 1999; and o lower legal fees in 2000 compared with 1999 related to the lawsuit with Taylor Publishing. Operating Income Operating income (loss) for the first quarter by segment and the changes from last year were as follows: Three months ended -------------------------------- April 1 April 3 In thousands 2000 1999 $ change % change - ----------------------------------------------------------------------------- School Products $28,411 $24,458 $3,953 16.2% Recognition (308) 129 (437) (338.8%) Other (7,353) (10,030) 2,677 (26.7%) - ----------------------------------------------------------------------------- Consolidated $20,750 $14,557 $6,193 42.5% ============================================================================= School Products The increase in School Products operating income of $4.0 million was primarily due to: o favorable mix and price increases; o higher sales of graduation products due to shorter production cycle times which allowed for earlier shipments in the first quarter of 2000 compared with the prior year; o manufacturing efficiencies in 2000; o a $1.5 million charge in the first quarter of 1999 to close a facility in Mexico and realign all Jewelry operations in the United States; and o lower legal fees in 2000 compared with 1999 related to the lawsuit with Taylor Publishing. These increases were partially offset by: o timing of jewelry sales volume as shipments were accelerated in the fourth quarter of 1999 due to manufacturing efficiencies compared with the prior year; o a decline in commercial printing volume; o higher commission expense in 2000 due to increased sales; o higher selling and marketing expense in 2000 related to programs and initiatives intended to increase our sales; o higher bad debt expense in 2000; and o higher information system depreciation expense as a result of our 1999 systems implementations. 12 Recognition The decrease in Recognition operating income of $0.4 million was primarily due to: o a sales decline primarily due to a change in product mix from jewelry to brand name merchandise; and o higher information system depreciation expense as a result of our 1999 systems implementations. This decreases were partially offset by: o reduced spending on temporary labor in our Recognition segment in 2000 compared with 1999 as we prepared for a system implementation in the first quarter of 1999. Other The decrease in Other operating loss of $2.7 million was primarily due to: o lower selling and administrative expenses as a result of exiting the college alumni direct marketing business in the fourth quarter of 1999; o lower spending in 2000 compared with 1999 related to our new product and channel development group; and o lower information system expense due to decreased spending related to the year 2000 and Oracle system. Net Interest Expense Net interest expense increased $0.7 million in the first quarter of 2000 over the prior year period. The year-over-year increase reflects lower average borrowings offset by higher average interest rates in 2000. Income Taxes Income taxes for the first quarter of 2000 and 1999 were accrued at an overall effective rate of 40.5 percent. LIQUIDITY AND CAPITAL RESOURCES Cash generated from operating activities and availability under short-term borrowing agreements were our principal sources of liquidity for the quarter ended April 1, 2000. These funds covered our dividend payments, investments in property and equipment, and equity investments. Operating Activities Operating activities generated cash of $24.3 million in the first three months of 2000, compared with $28.6 million for the same period in the prior year. The decrease of $4.3 million was primarily due to the timing of customer deposits and accounts payable, offset by higher net income and reduced inventories. Investing Activities Capital expenditures for the first three months of 2000 were $2.7 million, compared with $7.3 million for the same period in 1999. The decrease of $4.6 million relates to higher capital expenditures in 1999 on information systems. Financing Activities Net cash used for financing activities in the first three months of 2000 was $45.1 million, compared with $18.8 million for the same period in 1999. The increase of $26.3 million was primarily due to repayments of short-term borrowings as a result of delaying these payments to ensure availability of funds until after the year 2000 date change. This increase was offset by the decrease in common stock repurchases. 13 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK There have been no material changes in our market risk during the three months ended April 1, 2000. For additional information, refer to Item 7A on page 17 of our 1999 Form 10-K. 14 PART II OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS On May 9, 2000, we agreed in principal to settle the three purported class action lawsuits that were filed in Minnesota district court for the County of Hennepin against Jostens and its directors alleging breaches of fiduciary duty by Jostens' directors in connection with the merger. The settlement is subject to court approval. There have been no other material developments in legal proceedings during the three months ended April 1, 2000. For additional information, refer to Item 3 on pages 6 and 7 of our 1999 Form 10-K. We are occasionally a party to litigation arising in the normal course of business. We regularly analyze current information and, as necessary, provide accruals for probable liabilities on the eventual disposition of these matters. We believe the effect on our consolidated results of operations and financial position, if any, for the disposition of all currently pending matters will not be material. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS At the special meeting of shareholders held on May 9, 2000, Jostens shareholders voted on the following item: 1. Approval of the merger and of the Merger Agreement between Jostens, Inc. and Saturn Acquisition Corporation. Votes were cast for approval of the merger and the Merger Agreement as follows: Votes For 23,734,518 Votes Against 1,209,304 Abstentions 147,193 ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits 12 Computation of Ratio of Earnings to Fixed Charges 27 Financial Data Schedule (b) Reports on Form 8-K A Form 8-K dated and filed on April 14, 2000, announcing that Jostens would hold a special meeting of shareholders on Tuesday, May 9, 2000, at 10:00 a.m. to vote on the proposed merger of Jostens with a company controlled by Investcorp, a global investment group, and its co-investors. Additionally, the special proxy in connection with the said special meeting of shareholders was mailed on April 7, 2000. A Form 8-K dated April 27, 2000 and filed on April 28, 2000, announcing earnings for the three months ended April 1, 2000. A Form 8-K dated May 11, 2000 and filed on May 12, 2000, announcing that our shareholders approved the pending merger with a company controlled by Investcorp, a global investment group, and its co-investors. 15 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, on May 12, 2000. JOSTENS, INC. Registrant By /s/ Robert C. Buhrmaster -------------------------------------- Robert C. Buhrmaster Chairman of the Board, President and Chief Executive Officer By /s/ William N. Priesmeyer -------------------------------------- William N. Priesmeyer Senior Vice President and Chief Financial Officer (Chief Accounting Officer) 16 EX-12 2 COMPUTATION OF RATIO OF EARNINGS EXHIBIT 12 JOSTENS, INC. AND SUBSIDIARIES COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (UNAUDITED)
Six months Three months ended Years ended ended Years ended ---------------------- ------------------------------- ------------ ----------------- April 1 April 3 January 1 January 2 January 3 December 28 June 30 June 30 Dollars in thousands 2000 1999 2000 1999 1998 1996 1996 1995 - -------------------------------------------------------------- ------------------------------- ------------ ------------------ Earnings Income from continuing operations before income taxes $19,023 $13,518 $74,659 $83,520 $93,383 $ 26 $87,479 $ 93,893 Interest expense (excluding capitalized interest) 1,916 1,122 7,312 7,014 6,854 4,324 9,296 5,350 Portion of rent expense under long-term operating leases representative of an interest factor 322 398 1,483 1,233 2,133 1,070 2,103 2,100 Amortization of debt expense 23 3 174 12 12 6 107 102 - -------------------------------------------------------------- ------------------------------- ------------ ------------------ Total earnings $21,284 $15,041 $83,628 $91,779 $102,382 $5,426 $98,985 $101,445 ============================================================== =============================== ============ ================== Fixed charges Interest expense (including capitalized interest) $ 1,916 $ 1,267 $ 7,713 $ 7,717 $ 6,854 $4,324 $ 9,296 $ 5,350 Portion of rent expense under long-term operating leases representative of an interest factor 322 398 1,483 1,233 2,133 1,070 2,103 2,100 Amortization of debt expense 23 3 174 12 12 6 107 102 - -------------------------------------------------------------- ------------------------------- ------------ ------------------ Total fixed charges $ 2,261 $ 1,668 $ 9,370 $ 8,962 $ 8,999 $5,400 $11,506 $ 7,552 ============================================================== =============================== ============ ================== Ratio of earnings to fixed charges 9.4 9.0 8.9 10.2 11.4 1.0 8.6 13.4
EX-27 3 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM JOSTENS, INC. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE THREE MONTH PERIOD ENDED APRIL 1, 2000, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 3-MOS DEC-30-2000 JAN-02-2000 APR-01-2000 14,278 0 138,658 (6,405) 109,619 307,618 273,942 (193,192) 425,915 372,476 3,600 0 0 11,113 29,748 425,915 174,589 174,589 66,586 66,586 87,253 594 1,727 19,023 7,704 11,319 0 0 0 11,319 0.34 0.34
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