-----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, GkVAaOQd/dW1i1fPzHrfRSxSYxg3KiUFVHOj1h3ok0A+zzjIVYiqPdbiM3Rfc4KH uWtq+AUoLCujA1wv+aLVig== 0000950152-97-007709.txt : 19971110 0000950152-97-007709.hdr.sgml : 19971110 ACCESSION NUMBER: 0000950152-97-007709 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970930 FILED AS OF DATE: 19971107 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: MYERS INDUSTRIES INC CENTRAL INDEX KEY: 0000069488 STANDARD INDUSTRIAL CLASSIFICATION: PLASTICS PRODUCTS, NEC [3089] IRS NUMBER: 340778636 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-08524 FILM NUMBER: 97710422 BUSINESS ADDRESS: STREET 1: 1293 S MAIN ST CITY: AKRON STATE: OH ZIP: 44301 BUSINESS PHONE: 2162535592 MAIL ADDRESS: STREET 1: 1293 SOUTH MAIN STREET CITY: AKRON STATE: OH ZIP: 44301 FORMER COMPANY: FORMER CONFORMED NAME: MYERS TIRE SUPPLY CO DATE OF NAME CHANGE: 19720609 10-Q 1 MYERS INDUSTRIES, INC. QUARTERLY REPORT/FORM 10-Q 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 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 September 30, 1997 ------------------------------------------------ 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 I-8524 ----------------- MYERS INDUSTRIES, INC. ------------------------------------------------------ (Exact name of registrant as specified in its charter) OHIO #34-0778636 - -------------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1293 SOUTH MAIN STREET, AKRON, OHIO 44301 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (330) 253-5592 ------------------------ Indicate 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 . ---------- ----------- Applicable Only to Issuers Involved in Bankruptcy Proceedings During the Preceding Five Years Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes . No . ----- ----- As of October 31, 1997, the number of shares outstanding of the issuer's Common Stock was: 18,269,181 ========== 2 -1- PART I FINANCIAL INFORMATION ---------------------------- MYERS INDUSTRIES, INC. ---------------------- CONDENSED STATEMENT OF CONSOLIDATED FINANCIAL POSITION AS OF SEPTEMBER 30, 1997 AND DECEMBER 31, 1996 ------------------------------------------------------
September 30, December 31, ASSETS 1997 1996 ------------ ------------ CURRENT ASSETS Cash and temporary cash investments $ 543,179 $ 5,600,349 Accounts receivable-less allowances of $2,211,000 and $2,213,000, respectively 52,547,617 57,604,506 Inventories Finished and in-process products 33,953,476 33,042,266 Raw materials and supplies 6,687,362 6,788,086 ------------ ------------ 40,640,838 39,830,352 Prepaid expenses 3,912,799 3,274,673 ------------ ------------ TOTAL CURRENT ASSETS 97,644,433 106,309,880 OTHER ASSETS Excess of cost over fair value of net assets of companies acquired 20,721,544 14,328,410 Patents and other intangible assets 2,508,358 2,750,530 Other 2,673,733 3,072,974 ------------ ------------ 25,903,635 20,151,914 PROPERTY, PLANT & EQUIPMENT, AT COST Land 2,476,194 2,547,509 Buildings and leasehold improvements 41,215,698 38,918,648 Machinery and equipment 125,462,356 108,594,273 ------------ ------------ 169,154,248 150,060,430 Less allowances for depreciation and amortization 77,828,085 69,400,497 ------------ ------------ 91,326,163 80,659,933 ------------ ------------ $214,874,231 $207,121,727 ============ ============
3 -2- PART I - FINANCIAL INFORMATION ------------------------------ MYERS INDUSTRIES, INC. ---------------------- CONDENSED STATEMENT OF CONSOLIDATED FINANCIAL POSITION AS OF SEPTEMBER 30, 1997 AND DECEMBER 31, 1996 ------------------------------------------------------
September 30, December 31, LIABILITIES AND SHAREHOLDERS' EQUITY 1997 1996 ------------- ------------- CURRENT LIABILITIES Accounts payable $ 14,733,464 $ 15,189,488 Employee compensation and related items 8,725,229 10,562,313 Accrued expenses Taxes, other than income taxes 1,349,846 1,062,498 Income taxes (1,147,706) 1,452,107 Other 9,678,352 8,066,838 Current portion of long-term debt 957,755 519,769 ------------- ------------- TOTAL CURRENT LIABILITIES 34,296,940 36,853,013 LONG-TERM DEBT, less current portion 8,176,476 4,569,396 DEFERRED INCOME TAXES 3,253,927 3,254,327 SHAREHOLDERS' EQUITY Serial Preferred Shares (authorized 1,000,000) -- -- Common Shares, without par value (authorized 30,000,000 shares; outstanding 18,257,270 and 18,539,982, respectively)* 6,820,982 10,659,714 Additional paid-in capital 137,827,334 109,864,137 Foreign currency translation adjustment (360,218) (213,572) Retained income 24,858,790 42,134,712 ------------- ------------- 169,146,888 162,444,991 ------------- ------------- $ 214,874,231 $ 207,121,727 ============= =============
*Adjusted for a ten percent stock dividend in August, 1997. 4 -3- PART I - FINANCIAL INFORMATION ------------------------------ MYERS INDUSTRIES, INC. ---------------------- CONDENSED STATEMENT OF CONSOLIDATED INCOME ------------------------------------------
FOR THE THREE FOR THE NINE MONTHS ENDED MONTHS ENDED ----------------------------- ------------------------------ September 30, September 30, September 30, September 30, 1997 1996 1997 1996 ----------- ----------- ------------ ------------ Net sales $81,141,353 $77,879,982 $244,115,071 $230,385,397 Costs and expenses Cost of sales 57,072,104 55,207,594 169,286,385 157,774,466 Operating expenses 17,347,176 16,337,585 50,759,866 47,681,893 Interest expense, net 55,369 47,556 162,144 301,868 ----------- ----------- ------------ ------------ Total costs & expenses 74,474,649 71,592,735 220,208,395 205,758,227 Income before income taxes 6,666,704 6,287,247 23,906,676 24,627,170 Income taxes 2,734,000 2,578,000 9,852,000 10,097,000 ----------- ----------- ------------ ------------ Net income $ 3,932,704 $ 3,709,247 $ 14,054,676 $ 14,530,170 =========== =========== ============ ============ Net income per Common Share* $ .21 $ .20 $ .76 $ .78 Dividends per Common Share* $ .05 $ .045 $ .14 $ .12 Weighted average number of Common Shares outstanding* 18,496,143 18,639,360 18,529,742 18,628,000
*Adjusted for a ten percent stock dividend in August, 1997. 5 -4- PART I - FINANCIAL INFORMATION ------------------------------ MYERS INDUSTRIES, INC. ---------------------- STATEMENTS OF CONSOLIDATED CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996 -----------------------------------------------------
Sept. 30, Sept. 30, 1997 1996 CASH FLOWS FROM OPERATING ACTIVITIES ------------ ------------ Net income $ 14,054,676 $ 14,530,170 Items not affecting use of cash Depreciation 8,925,178 8,046,707 Amortization of excess of cost over fair value of net assets of companies acquired 556,380 416,520 Amortization of other intangible assets 409,917 357,752 Cash flow provided by (used for) working capital Accounts receivable 5,588,688 (1,037,260) Inventories (385,923) 2,777,840 Prepaid expenses (730,245) 1,438,333 Accounts payable and accrued expenses (3,165,769) (495,111) ------------ ------------ Net cash provided by operating activities 25,252,902 26,034,951 CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of business, net of cash acquired (7,955,077) -- Additions to property, plant and equipment, net (18,868,810) (13,639,879) Other 168,441 (24,503) ------------ ------------ Net cash used for investing activities (26,655,446) (13,664,382) CASH FLOWS FROM FINANCING ACTIVITIES Borrowings (repayments) - net 3,540,801 (9,178,573) Cash dividends paid (2,614,897) (2,202,350) Proceeds from issuance of common stock 596,308 564,993 Repurchase of common stock (5,176,838) (273,072) ------------ ------------ Net cash provided by (used for) financing activities (3,654,626) (11,089,002) (DECREASE) INCREASE IN CASH AND TEMPORARY CASH INVESTMENTS (5,057,170) 1,281,567 CASH AND TEMPORARY CASH INVESTMENTS JANUARY 1 5,600,349 3,387,562 ------------ ------------ CASH AND TEMPORARY CASH INVESTMENTS SEPTEMBER 30 $ 543,179 $ 4,669,129 ============ ============
6 -5- PART I - FINANCIAL INFORMATION ------------------------------ MYERS INDUSTRIES, INC. ---------------------- NOTES TO FINANCIAL STATEMENTS ----------------------------- (1) Statement of Accounting Policy ------------------------------ The accompanying financial statements include the accounts of Myers Industries, Inc. and subsidiaries (Company), and have been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures are adequate to make the information not misleading. It is suggested that these financial statements be read in conjunction with the financial statements and notes thereto included in the Company's latest annual report on Form 10-K. In the opinion of the Company, the accompanying financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the financial position as of September 30, 1997, and the results of operations and cash flows for the three months and nine months ended September 30, 1997 and 1996. (2) Supplemental Disclosure of Cash Flow Information ------------------------------------------------ The Company made cash payments for interest expense of $197,064 and $135,583 for the three months ended September 30, 1997 and 1996, respectively. Cash payments for interest expense were $397,848 and $653,239 for the nine months ended September 30, 1997 and 1996, respectively. Cash payments for income taxes for the three months ended September 30, 1997 and September 30, 1996 were $4,901,731 and $3,616,502, respectively. For the nine month period the payments for income taxes were $12,610,677 for 1997 and $13,328,805 for 1996. 7 -6- (3) Acquisition ----------- On April 25, 1997, the Company acquired substantially all of the assets of Molded Solutions, Inc., a manufacturer of custom engineered molded rubber products. The Asset Purchase Agreement provides for payment of additional consideration contingent upon the earnings of Molded Solutions during the 12 month period ending April 25, 1998. The acquisition has been accounted for using the purchase method and, accordingly, Molded Solution's results of operations, the amounts of which are not material, have been included in the Company's consolidated financial statements since the date of acquisition. The purchase price allocation has been based on preliminary estimates with the excess of purchase price over the fair value of assets acquired being amortized on a straight line basis over 15 years. 8 -7- PART I - FINANCIAL INFORMATION ------------------------------ MYERS INDUSTRIES, INC. ---------------------- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS --------------------------------------------- RESULTS OF OPERATIONS - --------------------- Myers Industries, Inc. reported increased sales for both the quarter and nine month period ended September 30, 1997. Sales rose 4.2 percent to $81.1 million for the quarter as compared to $77.9 million in 1996. In the first nine months, sales increased to $244.1 million, an increase of 6.0 percent from $230.4 million a year ago. Net income for the third quarter ended September 30, 1997 was $3.9 million an increase of 6 percent from $3.7 million in the prior year. Net income per share was $.21 for the quarter, an increase of 5 percent from the $.20 per share reported in 1996. Earnings in the first nine months were $14.1 million or $.76 per share, a decrease of 3 percent compared with the $14.5 million and $.78 per share in 1996. For the quarter net sales increased primarily on the strength of unit volume increases in the Distribution segment. For the quarter, sales in the Distribution segment increased 9.6 percent while sales in the Manufacturing segment were basically flat. Year to date, sales in the Distribution segment are up 9.7 percent and Manufacturing segment sales have increased 3.8 percent. Cost of sales increased 3.4 percent or $1.9 million for the quarter and $11.5 million or 7.3 percent for the nine months ended September 30, 1997. Gross profit, expressed as a percentage of sales, increased to 29.7 percent for the quarter and decreased to 30.7 percent for the nine month period compared to 29.1 percent and 31.5 percent for the same periods in 1996. The year-to-date decline in gross profit margin is primarily due to higher raw material costs, principally plastic resins, used in the Manufacturing segment. Operating expenses increased $1.0 million or 6.2 percent for the quarter and $3.1 million or 6.5 percent for the nine month period ended September 30, 1997. Operating expenses, expressed as a percentage of sales, increased slightly to 21.4 percent for the quarter compared with 21.0 percent in the same quarter of 1996. For the nine month period, operating expenses as a percentage of sales also increased slightly to 20.8 percent from 20.7 percent in the prior year. Net interest expense for the quarter increased to $55,369 from $47,556 in 1996 reflecting higher borrowing levels as a result of the Molded Solutions acquisition. For the nine month period, net interest expense decreased to $162,144 from $301,868 based on lower average borrowing levels. 9 -8- Results of Operations (Con't) - ----------------------------- In February 1997, the Financial Accounting Standards Board (FASB) issued Statement No. 128, "Earnings per Share" which eliminates the concept of common stock equivalents and replaces the existing "primary" earnings per share with "basic" earnings per share. Basic earnings per share excludes potential dilution and is calculated by dividing income available to common shareholders by the weighted average shares outstanding. The new statement also changes the calculation of diluted earnings per share and replaces the existing fully diluted earnings per share requirement. FASB Statement No. 128 is effective for periods ending December 15, 1997, and requires that all prior period earnings per share presented be restated. The Company does not expect the new standard, when implemented, to have a material effect on the current or historical earnings per share amounts presented. LIQUIDITY AND CAPITAL RESOURCES - ------------------------------- Cash provided by operating activities is the primary source of liquidity and amounted to $25.3 million for the nine months ended September 30, 1997. Long-term debt increased by $3.6 million during the nine months of 1997 and debt as a percentage of total capitalization increased to 5.1 percent compared to 3.0 percent at December 31, 1996. Working capital decreased to $63.3 million at September 30, 1997 from $69.5 million at December 31, 1996. Capital expenditures for the nine months ended September 30, 1997 were $18.9 million. The Company currently anticipates annual capital expenditures in the range of $15.0 to $20.0 million over the next five years. Management believes that anticipated cash flows from operations and available credit facilities will be sufficient to fund capital expenditures and meet its short-term and long-term needs. 10 -9- PART II - OTHER INFORMATION --------------------------- MYERS INDUSTRIES, INC. ---------------------- Item 6. Exhibits and Reports on Form 8-K -------------------------------- (a) Financial Data Schedule (b) Form 8-K None SIGNATURE --------- 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. MYERS INDUSTRIES, INC. 11/7/97 By: \s\ Gregory J. Stodnick - ----------------------------- --------------------------- Date Gregory J. Stodnick Vice President-Finance Financial Officer (Duly Authorized Officer and Principal Financial and Accounting Officer) EX-27 2 EXHIBIT 27
5 9-MOS DEC-31-1997 JAN-01-1997 SEP-30-1997 543,179 0 54,758,617 2,211,000 40,640,838 97,644,433 169,154,248 77,828,085 214,874,231 34,296,940 0 0 0 6,820,982 162,325,906 214,874,231 244,115,071 244,115,071 169,286,385 220,208,395 28,231,475 2,211,000 162,144 23,906,676 9,852,000 14,054,676 0 0 0 14,054,676 0.76 0.76
-----END PRIVACY-ENHANCED MESSAGE-----