-----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, Gvay+N7Fvi9SSyP9Npn1lgQSwhEV4DwfpgsOyidjwOIaKoaK9yl+cq1LfCNKjTqB Y2EblPsyYMHjmaKsi8sT4g== 0000007084-95-000031.txt : 19951120 0000007084-95-000031.hdr.sgml : 19951120 ACCESSION NUMBER: 0000007084-95-000031 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951114 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: ARCHER DANIELS MIDLAND CO CENTRAL INDEX KEY: 0000007084 STANDARD INDUSTRIAL CLASSIFICATION: FATS & OILS [2070] IRS NUMBER: 410129150 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-00044 FILM NUMBER: 95593078 BUSINESS ADDRESS: STREET 1: 4666 FARIES PKWY CITY: DECATUR STATE: IL ZIP: 62526 BUSINESS PHONE: 2174245200 10-Q 1 10-Q FOR 09/30/95 PAGE 1 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 September 30, 1995 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 1-44 ARCHER-DANIELS-MIDLAND COMPANY (Exact name of registrant as specified in its charter) Delaware 41-0129150 (State or other jurisdiction of (I. R. S. Employer incorporation or organization) Identification No.) 4666 Faries Parkway Box 1470 Decatur, Illinois 62525 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code217-424-5200 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 latest practicable date. Common Stock, no par value--530,169,008 shares (September 30, 1995) 1 PAGE 2 PART I - FINANCIAL INFORMATION ARCHER DANIELS MIDLAND COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)
THREE MONTHS ENDED SEPTEMBER 30, 1995 1994 ______________________ (In thousands, except per share amounts) Net sales and other operating income $3,120,738 $3,015,223 Cost of products sold and other operating costs 2,796,407 2,670,404 _________ _________ Gross Profit 324,331 344,819 Selling, general and administrative 98,721 100,309 expenses _________ _________ Earnings From Operations 225,610 244,510 Other income (expense) 21,515 (15,556) _________ _________ Earnings Before Income Taxes 247,125 228,954 Income taxes 84,023 74,410 _________ _________ Net Earnings $163,102 $154,544 ========= ========= Average number of shares outstanding 530,744 541,334 Net earnings per common share $.31 $.28 Dividends per common share $.024 $.015
See notes to consolidated financial statements. 2 PAGE 3 ARCHER DANIELS MIDLAND COMPANY AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited)
SEPTEMBER 30, JUNE 30, 1995 1995 (In thousands) ASSETS Current Assets Cash and cash equivalents $ 658,828 $454,593 Marketable securities 482,326 664,690 Receivables 1,062,352 1,013,562 Inventories 1,585,897 1,473,896 Prepaid expenses 122,556 105,904 _________ _________ _ _ Total Current Assets 3,911,959 3,712,645 Investments and Other Assets Investments in and advances to 505,999 502,698 affiliates Long-term marketable securities 1,688,353 1,604,219 Other assets 195,576 175,044 _________ _________ _ _ 2,389,928 2,281,961 Property, Plant and Equipment Land 112,282 113,098 Buildings 1,117,506 1,109,249 Machinery and equipment 5,489,504 5,443,561 Construction in progress 727,967 642,825 Less allowances for depreciation (3,614,981) (3,546,452) _________ _________ _ _ 3,832,278 3,762,281 _________ _________ _ _ $10,134,165 $9,756,887 ========= =========
See notes to consolidated financial statements. 3 PAGE 4 ARCHER DANIELS MIDLAND COMPANY AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited)
SEPTEMBER 30,JUNE 30, 1995 1995 (In thousands) LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Short-term debt $ 52,193 $ - Accounts payable 863,960 725,046 Accrued expenses 478,873 431,725 Current maturities of long-term debt 17,207 15,614 __________ _________ Total Current Liabilities 1,412,233 1,172,385 Long-Term Debt 2,069,697 2,070,095 Deferred Credits 560,819 538,351 Income taxes 102,211 121,891 Other __________ __________ 663,030 660,242 Shareholders' Equity Common stock 3,632,447 3,668,977 Reinvested earnings 2,356,758 2,185,188 __________ __________ 5,989,205 5,854,165 __________ __________ $10,134,165 $ 9,756,887 ========== ==========
See notes to consolidated financial statements. 4 PAGE 5 ARCHER DANIELS MIDLAND COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
THREE MONTHS ENDED SEPTEMBER 30, 1995 1994 ______________________ (In thousands) Operating Activities Net earnings $ 163,102 $ 154,544 Adjustments to reconcile to net cash provided by operations Depreciation and amortization 96,453 95,069 Deferred income taxes 4,229 3,501 Amortization of long-term debt discount 6,149 5,297 Other (22,313) 9,872 Changes in operating assets and liabilities Receivables (78,735) (28,580) Inventories (127,907) 100,104 Prepaid expenses (16,806) (21,070) Accounts payable and accrued expenses201,840 109,103 _______ _______ Total Operating Activities 226,012 427,840 Investing Activities Purchases of property, plant and equipment(176,370) (146,352) Business acquisitions (23,390) - Investments in and advances to affiliates(13,864) (20,819) Purchases of marketable securities (219,351) (778,761) Proceeds from sales of marketable securities415,838 462,376 Other (1,241) _______ _______ Total Investing Activities (18,378) (483,556) Financing Activities Long-term debt borrowings 6,305 - Long-term debt payments (5,103) (17,986) Net borrowings under line of credit agreements54,193 76,287 Purchases of treasury stock (46,404) (1) Cash dividends and other (12,390) (8,425) _______ _______ Total Financing Activities (3,399) 49,875 _______ _______ Increase (Decrease) In Cash and Cash Equivalents204,235(5,841) Cash and Cash Equivalents Beginning of Period454,593 316,394 _______ _______ Cash and Cash Equivalents End of Period$ 658,828 $ 310,553 ======= =======
See notes to consolidated financial statements. 5 PAGE 6 ARCHER DANIELS MIDLAND COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1.The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the quarter ended September 30, 1995 are not necessarily indicative of the results that may be expected for the year ending June 30, 1996. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's annual report on Form 10-K for the year ended June 30, 1995. Note 2. Other Income (Expense)
THREE MONTHS ENDED SEPTEMBER 30, 1995 1994 __________________ (In thousands) Investment income $41,823 $ 32,262 Interest expense (40,077) (42,769) Gain (loss) on marketable securities transactions 688 (4,824) Other, including equity in earnings of affiliates 19,081 (225) ______ ______ $21,515 $(15,556) ====== ======
Note 3. Per Share Data All references to share and per share information have been adjusted for the 5 percent stock dividend paid September 18, 1995. 6 PAGE 7 Note 4. Antitrust Investigation and Related Litigation The Company, along with a number of other domestic and foreign companies, is the subject of a grand jury investigation into possible violations of federal antitrust laws and possible related crimes in the food additives industry. The investigation is directed towards possible price-fixing with respect to lysine, citric acid and high fructose corn syrup. Neither the Company nor any director, officer or employee has been charged in connection with the investigation. Following public announcement of the investigation, the Company and certain of its directors and executive officers were named as defendants in a number of putative class actions alleging violations of antitrust and securities laws relating to the Company's marketing practices in the food additives industry, specifically with respect to lysine, citric acid and high fructose corn syrup. The plaintiffs generally request unspecified compensatory and punitive damages, costs expenses and unspecified relief. The Company and the individuals named as defendants intend to vigorously defend these class actions. These matters could result in the Company being subject to monetary damages, fines, penalties and other sanctions and expenses. However, because of the early stage of the investigation, the ultimate outcome of the investigation and the putative class actions cannot presently be determined. Accordingly, no provision for any liability that may result therefrom has been made in the accompanying consolidated financial statements. Shareholder derivative actions also have been filed against certain of the Company's directors and executive officers and nominally against the Company alleging that the individuals named as defendants breached their fiduciary duties to the Company and seeking monetary damages and other relief on behalf of the Company from the individuals named as defendants. The Company intends to seek dismissal of these derivative actions on the ground that they cannot be maintained unless the plaintiffs first brought their complaints to the Company's Board of Directors, which they did not. The Company from time to time, in the ordinary course of business, is named as a defendant in various other lawsuits. In management's opinion, the gross liability from such other lawsuits, including environmental exposure, with or without insurance recoveries is not considered to be material to the Company's financial condition or results of operations. 7 PAGE 8 ARCHER DANIELS MIDLAND COMPANY AND SUBSIDIARIES MANAGEMENT'S DISCUSSION OF OPERATIONS AND FINANCIAL CONDITIONS The Company is in one business segment - procuring, transporting, storing, processing and merchandising agricultural commodities and products. The availability and price of agricultural commodities are subject to wide fluctuations due to unpredictable factors such as: weather; plantings; government (domestic and foreign) farm programs and policies; changes in global demand created by population growth and higher standards of living; and global production of similar and competitive crops. Generally, changes in the price of agricultural commodities can be passed through to the price of processed products. Ethanol is one of a limited few of the Company's processed products which must be priced to compete with products produced from other raw materials. The Company follows a policy of hedging substantially all inventory and related purchase and sale contracts. In addition, the Company from time to time will hedge anticipated production, generally not exceeding six months requirements. These hedges are made to reduce price risk of market fluctuations and risk of crop failure. The instruments used are principally readily marketable exchange traded futures contracts which are designated as hedges. The changes in market value of such contracts have a high correlation to the price changes of the hedged commodity. Also, the underlying commodity can be delivered against such contracts. To obtain a proper matching of revenue and expense, gains or losses arising from open and closed hedging transactions are included in inventory as a cost of the commodities and reflected in the income statement when the product is sold. Inflation, over time, has an impact on agricultural commodity prices. The Company's business is capital intensive and inflation could impact the cost of capital investment. OPERATIONS Net sales and other operating income increased $106 million to $3.1 billion for the quarter from $3 billion last year due primarily to a 7 percent increase in volume of products sold. This increase was partially offset by a 1 percent decrease in average selling prices, the sale of the Company's British Arkady and Supreme Sugar subsidiaries and the contribution of the Company's formula feed operation to an unconsolidated joint venture. A summary of net sales and other operating income by classes of products and services is as follows:
THREE MONTHS ENDED SEPTEMBER 30, 1995 1994 (In millions) Oilseed products $1,856 $ 1,677 Corn products 616 675 Wheat and other milled products 403 353 Other products 246 310 _____ _____ $3,121 $ 3,015
===== ===== 8 PAGE 9 Sales of oilseed products increased 11% to $1.9 billion due primarily to increased volume, including sales of acquired businesses, as good demand for meal products both in the export and domestic markets contributed to favorable oilseed processing market conditions. Sales of corn products decreased 9% to $616 million due primarily to reduced sales volumes and to a lesser extent lower average selling prices. Sales of wheat and other milled products increased 14% due principally to increased average selling prices of wheat flour which resulted from the higher cost of raw materials. The decrease in sales of other products was due to the sale of the Company's Supreme Sugar subsidiary and British Arkady bakery ingredient business as well as the contribution of the Company's formula feed operation to an unconsolidated joint venture. Cost of products sold and other operating costs increased $126 million to $2.8 billion for the quarter due primarily to the 7% increased in volume of products sold and to a lesser extent higher corn and wheat raw materials commodity prices. The $20 million decrease in gross profit for the quarter to $324 million can be attributed to a $25 million decrease due to the combined effect of higher raw material commodity prices and lower average selling prices and a $15 million decrease due to divested operations. These decreases were partially offset by a $20 million increase in gross profit due to higher sales volumes. Selling, general and administrative expenses decreased $2 million to $99 million due primarily to $11 million of expense attributable to recently divested operations which were partially offset by general cost increases in support of increased sales volumes. The increase in other income (expense) for the quarter resulted primarily from the $15 million gain on the sale of the Company's Supreme Sugar Company subsidiary and to a lesser extent increased investment income, due to both higher levels of invested funds and higher interest rates, increased gains on marketable securities transactions and increased equity in earnings of unconsolidated affiliates. The increase in income taxes for the quarter resulted primarily from higher pretax earnings. The Company's effective income tax rate for the quarter was 34 percent compared to 33 percent last year. LIQUIDITY AND CAPITAL RESOURCES During the three months ended September 30, 1995, the Company's liquidity continued to improve as cash and marketable securities net of short-term debt increased $54 million to $2.8 billion and its capital resources were strengthened by a $135 million increase in net worth to $6 billion. The Company's ratio of long-term liabilities to total capital at September 30, 1995 was approximately 24 percent. As discussed in Note 4 to the consolidated financial statements, the Company, along with a number of other domestic and foreign companies, is the subject of a grand jury investigation into possible violations of federal antitrust laws and possible related crimes in the food additives industry. Neither the Company nor any director, officer or employee has been charged in connection with the investigation. In addition, related civil class actions are pending. These matters could result in the Company being subject to monetary damages, fines, penalties and other sanctions and expenses. However, because of the early stage of the investigation, the ultimate outcome of these matters cannot presently be determined. Accordingly, no provision for any liability that may result therefrom has been made in the accompanying consolidated financial statements. 9 PAGE 10 PART II - OTHER INFORMATION Item 1. Legal Proceedings The Company, along with a number of other domestic and foreign companies, is the subject of an investigation being conducted by a grand jury in the Northern District of Illinois in Chicago, into possible violations of federal antitrust laws and possible related crimes in the food additives industry. This investigation is directed towards possible price- fixing with respect to lysine, citric acid, and high fructose corn syrup. Federal grand juries in other jurisdictions also may have been convened to investigate certain of these matters. Neither the Company nor any director, officer or employee of the Company has been charged in connection with this investigation. Following public announcement in June 1995 of the investigation, the Company and certain of its directors and executive officers were named as defendants in at least seventeen putative class action suits on behalf of all purchasers of securities of the Company during the period between certain dates in 1992 and 1995. Fourteen of these suits were consolidated under the name IN Re Archer-Daniels- Midland Company Securities Litigation, United States District Court, Northern District of Illinois, Civil Action No. 95-C-3979, and a consolidated complaint was filed on September 22, 1995. The consolidated complaint alleges that the defendants made material omissions with respect to the Company and its operations and with respect to actions of the Company and its officers regarding antitrust violations, as a result of which market prices of the Company's securities were artificially inflated during the putative class period. The consolidated complaint alleges that the conduct complained of violates federal securities laws. The plaintiffs request unspecified compensatory damages, costs (including attorneys and expert fees), expenses and other unspecified relief on behalf of the putative class. On October 31, 1995, the Court granted the defendants' motion to transfer the consolidated action to the Central District of Illinois where at least three similar actions are also pending. The Company and the individual defendants have moved to dismiss this consolidated complaint. The Company, along with other companies, has been named as a defendant in at least twenty-one putative class action antitrust suits involving the sale of high fructose corn syrup. Seventeen of these actions allege violations of federal antitrust laws, including allegations that the defendants agreed to fix, stabilize and maintain at artificially high levels the prices of high fructose corn syrup, and seek injunctions against continued alleged illegal conduct, treble damages of an unspecified amount, attorneys fees and costs, and other unspecified relief. 10 PAGE 11 The putative classes in these cases comprise certain direct purchasers of high fructose corn syrup during certain periods in the 1990s. One such action was filed on July 21, 1995 in the United States District Court for the Northern District of Alabama and is encaptioned Golden Eagle, Inc. v. Archer-Daniels- Midland Co., et al., Civil Action No. 95-B-1888-J. The Company, along with other companies, also has been named as a defendant in at least four putative class action antitrust suits filed in California state court involving the sale of high fructose corn syrup. These actions allege violations of the California antitrust and unfair competition laws, including allegations that the defendants agreed to fix, stabilize and maintain at artificially high levels the prices of high fructose corn syrup, and seek treble damages of an unspecified amount, attorneys fees and costs, restitution and other unspecified relief. Two of the putative classes comprise certain direct purchasers of high fructose corn syrup in the State of California during certain periods in the 1990s. One such action was filed on October 17, 1995 in Superior Court for the County of Stanislaus, California and is encaptioned St. Stan's Brewing Co. v. Archer-Daniels- Midland Co., et al., Civil Action No. 37237. The other two putative classes comprise certain indirect purchasers of high fructose corn syrup in the State of California during certain periods in the 1990s. One such action was filed on July 21, 1995 in the Superior Court of the County of Los Angeles, California and is encaptioned Borgeson v. Archer-Daniels-Midland Co., et al., Civil Action No. BC131940. The Company has been named as a defendant in at least eleven putative class action antitrust suits involving the sale of lysine. Nine of these actions allege violations of federal antitrust laws, including allegations that certain entities agreed to fix, stabilize and maintain at artificially high levels the prices of lysine, and seek injunctions against continued alleged illegal conduct, treble damages of an unspecified amount, attorneys fees and costs, and other unspecified relief. The putative classes in these cases comprise certain direct purchasers of lysine for certain periods in the 1990s. One such action was filed on July 26, 1995 in the United States District Court for the Central District of Illinois and is encaptioned Walker Farms, Inc. v. Archer- Daniels-Midland Co., Civil Action No. 95-2186. The Company also has been named as a defendant in at least one putative class action antitrust suit filed in California state court and at least one putative class action antitrust suit filed in Alabama state court involving the sale of lysine. The California action alleges violations of the California antitrust and unfair competition laws, including allegations that the defendants agreed to fix, stabilize and maintain at artificially high levels the prices of lysine, and seeks an injunction against continued alleged illegal conduct, treble damages of an unspecified amount, attorneys fees and costs, restitution and other unspecified relief. The putative class in the California action comprises certain indirect purchasers of lysine in the State of California from February 1992 until at least September 1995. This action was filed on September 29, 1995 in the Superior Court of the County of San Diego, California, and is encaptioned Equine Competition Products, Inc. v. Archer-Daniels-Midland Co. et al., Civil Action No. 693014. The Alabama action alleges violations of the Alabama antitrust laws, including allegations that the defendants agreed to fix, stabilize and maintain at artificially high levels the prices of lysine, and seeks an injunction against continued alleged illegal conduct, damages of an unspecified amount, attorneys fees and costs, and other unspecified relief. The Alabama putative class comprises certain indirect purchasers of lysine from August 1993 until August 1995. This action was filed on August 17, 1995 in the Circuit Court of DeKalb County, Alabama, and is encaptioned Ashley v. Archer-Daniels-Midland Co. et al., Civil Action No. 95-336. The Company, along with other companies, has been named as a defendant in at least four putative class action antitrust suits involving the sale of citric acid. Three of these actions allege violations of federal antitrust laws, including allegations that the defendants agreed to fix, stabilize and maintain at artificially high levels the prices of citric acid, and seek injunctions against continued alleged illegal conduct, treble damages of an unspecified amount, attorneys fees and costs, and other unspecified relief. The putative classes in these cases comprise certain direct purchasers of citric acid for certain period in the 1990s. One such action was filed on August 18, 1995 in the United States District Court for the Northern District of California, and is encaptioned 7-Up Bottling Co. of Philadelphia, Inc. v. Archer-Daniels-Midland Co. et al., Civil Action No. 95- 2963. The Company, along with other companies, also has been named as a defendant in at least one putative class action antitrust suit filed in Alabama state court involving the sale of citric acid. This action alleges violations of the Alabama antitrust laws, including allegations that the defendants agreed to fix, stabilize and maintain at artificially high levels the prices of citric acid, and seeks an injunction against continued alleged illegal conduct, damages of an unspecified amount, attorneys fees and costs, and other unspecified relief. The putative class in the Alabama action comprises certain indirect purchasers of citric acid in the State of Alabama from July 1993 until July 1995. This action was filed on July 27, 1995 in Circuit Court of Walker County, Alabama and is encaptioned Seven Up Bottling Co. of Jasper, Inc. v. Archer-Daniels-Midland Co., et al., Civil Action No. 95-436. The Company, along with other companies, has been named as a defendant in at least two putative class action antitrust suits involving the sale of both high fructose corn syrup and citric acid. One of these actions alleges violations of the California antitrust and unfair competition laws, including allegations that the defendants agreed to fix, stabilize and maintain at 11 PAGE 12 artificially high levels the prices of high fructose corn syrup and citric acid, and seeks treble damages of an unspecified amount, attorneys fees and costs, restitution and other unspecified relief. The putative class in this case comprises certain direct purchasers of high fructose corn syrup and citric acid in the State of California from January 1992 until at least October 1995. This action was filed on October 11, 1995 in the Superior Court of Stanislaus County, California and is entitled Gangi Bros. Packing Co. v. Archer-Daniels-Midland Co., et al., Civil Action No. 37217. The Company, along with other companies, also has been named as a defendant in at least one putative class action antitrust suit filed in West Virginia state court involving the sale of high fructose corn syrup and citric acid. This action alleges violations of the West Virginia antitrust laws, including allegations that the defendants agreed to fix, stabilize and maintain at artificially high levels the prices of high fructose corn syrup and citric acid, and seeks treble damages of an unspecified amount, attorneys fees and costs, and other unspecified relief. The putative class in the West Virginia action comprises certain entities within the State of West Virginia that purchased products containing high fructose corn syrup and/or citric acid for resale from at least 1992 until 1994. This action was filed on October 26, 1995 in the Circuit Court of Boone County, West Virginia, and is encaptioned Freda's v. Archer- Daniels-Midland Co., et al., Civil Action No. 95-C- 125. Also following the public announcement of the grand jury investigation in June 1995, three shareholder derivative suits were filed against certain of the Company's directors and executive officers and nominally against the Company in the United States District Court for the Northern District of Illinois and at least fourteen similar shareholder derivative suits were filed in the Delaware Court of Chancery. The derivative suits filed in federal court in Illinois were consolidated under the name Felzen, et al. v. Andreas, et al, Civil Action Nos. 95-C-4006, 95- C-4535, and a consolidated amended derivative complaint was filed on September 29, 1995. This complaint names all current directors of the Company and one former director as defendants and names the Company as a nominal defendant. It alleges breach of fiduciary duty, waste of corporate assets, abuse of control and gross mismanagement, based on the antitrust allegations described above as well as other alleged wrongdoing. On October 31, 1995, the Court granted the defendants' motion to transfer the Illinois consolidated derivative action to the Central District of Illinois. The Company and the individual defendants have moved to dismiss this consolidated complaint. The Company and its directors also have been named as defendants in a putative class action suit encaptioned Loudon v. Archer-Daniels-Midland Co., et al., Civil Action No. 14638, filed in the Delaware Court of Chancery on October 20, 1995. This action alleges violations of Delaware state law and seeks invalidation of the election of the Company's directors on the basis of alleged omissions from the proxy statement issued by the Company prior to its October 19, 1995 annual meeting. The Company and the individual defendants have moved to dismiss this complaint. The Company and its directors also have been named as defendants in a similar suit filed on November 1, 1995 in the United States District Court for the Central District of Illinois, encaptioned Buckley v. Archer-Daniels-Midland Co., et al. Civil Action No. 95-C-2269, alleging violations of analogous provisions of federal securities law. The Company and the individual defendants named in the actions described above intend to vigorously defend them. These actions could result in the Company being subject to monetary damages, fines, penalties and other sanctions and expenses. However, because of the early stage of the investigation and civil litigation, the ultimate outcome of the investigation and the putative class actions cannot be determined. Accordingly, no provision for any liability that may result therefrom has been made in the consolidated financial statements. Reference is made to Item 3 to the Company's Annual Report on Form 10-K for the year ended June 30, 1995 for a discussion of additional legal proceedings. 12 PAGE 13 Item 2. Changes in Securities a) In July, 1995 the Board of Directors declared a 5 percent stock dividend which was paid on September 18, 1995, to shareholders of record on August 21, 1995. Item 6. Exhibits and Reports on Form 8-K a) Form 8-K reports were filed with the Securities and Exchange Commission on July 3, 1995 as amended on Form 8-K/A on July 26, 1995, setting forth information regarding the investigation into possible violations of federal antitrust laws in the food additives industry, specifically citric acid, high fructose corn syrup and lysine, and on July 20, 1995, as amended on Form 8-K/A on July 26, 1995, setting forth information regarding: (1) various shareholder derivative actions and putative class action suits filed against the Company and certain of its directors and executive officers; (2) formation of a committee of nine outside directors to direct the Company's response to matters related to the government investigations; and (3) authorization by the Board of Directors to purchase up to 20 million shares of the Company's issued and outstanding common stock. SIGNATURES Pursuant to the requirements of the Securities Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. ARCHER-DANIELS-MIDLAND COMPANY /s/ D. J. Schmalz D. J. Schmalz Vice President and Chief Financial Officer /s/ R. P. Reising R. P. Reising Vice President, Secretary and General Counsel Dated: November 14, 1995 13 EX-27 2 FINANCIAL DATA SCHEDULE FOR 10-Q 03/31/95
5 3-MOS JUN-30-1996 SEP-30-1995 658,828 482,326 1,062,352 0 1,585,897 3,911,959 7,447,259 3,614,981 10,134,165 1,412,233 2,069,697 3,632,447 0 0 2,356,758 10,134,165 3,120,738 3,120,738 2,796,407 2,796,407 0 0 40,077 247,125 84,023 163,102 0 0 0 163,102 .31 .31
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