-----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, Gy5qxUwfkQB7OhvJ5D/8QLFT84HhJUpzd8RN4W6DfrBJywX0xY2T0mu/mKSOAC5V ZB814eiPaZ4O7n+8vIjaWQ== 0000950123-99-004720.txt : 19990517 0000950123-99-004720.hdr.sgml : 19990517 ACCESSION NUMBER: 0000950123-99-004720 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990331 FILED AS OF DATE: 19990514 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RUSS BERRIE & CO INC CENTRAL INDEX KEY: 0000739878 STANDARD INDUSTRIAL CLASSIFICATION: DOLLS & STUFFED TOYS [3942] IRS NUMBER: 221815337 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-08681 FILM NUMBER: 99624012 BUSINESS ADDRESS: STREET 1: 111 BAUER DR CITY: OAKLAND STATE: NJ ZIP: 07436 BUSINESS PHONE: 2013379000 MAIL ADDRESS: STREET 2: 111 BAUER DRIVE CITY: OAKLAND STATE: NJ ZIP: 07436 FORMER COMPANY: FORMER CONFORMED NAME: BERRIE RUSS & CO INC DATE OF NAME CHANGE: 19920703 10-Q 1 RUSS BERRIE AND COMPANY, INC. 1 UNITED STATES 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 March 31, 1999 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 1-8681 RUSS BERRIE AND COMPANY, INC. (Exact name of registrant as specified in its charter) New Jersey 22-1815337 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 111 Bauer Drive, Oakland, New Jersey 07436 (Address of principal executive offices) (Zip Code) (201) 337-9000 (Registrant's telephone number, including area code) ________________________________________________________________________________ (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. CLASS OUTSTANDING AT MAY 5, 1999 Common stock, $0.10 stated value 21,238,089 2 RUSS BERRIE AND COMPANY, INC. INDEX PAGE PART I - FINANCIAL INFORMATION NUMBER Item 1. Financial Statements Consolidated Balance Sheet as of March 31, 1999 and December 31, 1998 3 Consolidated Statement of Income for the three months ended March 31, 1999 and 1998 4 Consolidated Statement of Cash Flows for the three months ended March 31, 1999 and 1998 5 Notes to Interim Consolidated Financial Statements 6 and 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 8 - 12 PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K 13 Signatures 14 2 3 PART 1 - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS RUSS BERRIE AND COMPANY, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (DOLLARS IN THOUSANDS)
(UNAUDITED) MARCH 31, DECEMBER 31, ASSETS 1999 1998 --------- --------- Current assets Cash and cash equivalents .......................... $ 57,238 $ 73,064 Marketable securities .............................. 149,971 152,759 Accounts receivable, trade, less allowances of $3,045 in 1999 and $2,722 in 1998 ............... 64,451 54,861 Inventories - net .................................. 36,548 45,201 Prepaid expenses and other current assets .......... 2,881 3,006 Deferred income taxes .............................. 5,421 5,325 --------- --------- TOTAL CURRENT ASSETS ...................... 316,510 334,216 Property, plant and equipment - net .................. 35,943 35,340 Other assets ......................................... 8,958 8,900 --------- --------- TOTAL ASSETS .............................. $ 361,411 $ 378,456 ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Accounts payable ................................... $ 3,633 $ 4,249 Accrued expenses ................................... 22,312 23,067 Accrued income taxes ............................... 10,794 7,205 --------- --------- TOTAL CURRENT LIABILITIES ................. 36,739 34,521 Commitments and contingencies Shareholders' equity Common stock: $.10 stated value; authorized 50,000,000 shares; issued 1999, 25,249,037 shares; 1998, 25,202,261 shares .................. 2,525 2,520 Additional paid in capital ......................... 59,366 58,553 Retained earnings .................................. 339,158 331,727 Accumulated other comprehensive (loss) ............. (1,375) (511) Treasury stock, at cost (4,031,414 shares at March 31, 1999 and 2,957,214 shares at December 31, 1998) ............................... (75,002) (48,354) --------- --------- TOTAL SHAREHOLDERS' EQUITY ................ 324,672 343,935 --------- --------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 361,411 $ 378,456 ========= =========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE CONSOLIDATED FINANCIAL STATEMENTS. 3 4 RUSS BERRIE AND COMPANY, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF INCOME (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED) THREE MONTHS ENDED MARCH 31, 1999 1998 ------- ------- Net sales ............................................ $75,403 $74,636 Cost of sales ........................................ 30,277 32,737 ------- ------- GROSS PROFIT ....................................... 45,126 41,899 Selling, general and administrative expense .......... 28,768 29,859 Investment and other income-net ...................... 2,022 3,176 ------- ------- INCOME BEFORE TAXES ............................... 18,380 15,216 Provision for income taxes ........................... 6,546 5,283 ------- ------- NET INCOME ........................................... $11,834 $ 9,933 ======= ======= NET INCOME PER SHARE: Basic .......................................... $ .54 $ .45 ======= ======= Diluted ........................................ $ .53 $ .44 ======= =======
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE CONSOLIDATED FINANCIAL STATEMENTS. 4 5 RUSS BERRIE AND COMPANY, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOWS (DOLLARS IN THOUSANDS)
(UNAUDITED) THREE MONTHS ENDED MARCH 31, 1999 1998 -------- -------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income ................................................... $ 11,834 $ 9,933 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation ............................................. 718 602 Amortization of intangible assets ........................ 30 30 Provision for accounts receivable reserves ............... 597 595 Deferred income taxes .................................... 106 109 Net (gain) loss from sale or disposal of fixed assets .... 163 (26) Changes in assets and liabilities: Accounts receivable ................................ (10,188) (11,734) Inventories - net .................................. 8,653 8,451 Prepaid expenses and other current assets .......... 123 (686) Other assets ....................................... (87) 31 Accounts payable ................................... (616) (239) Accrued expenses ................................... (754) (1,211) Accrued income taxes ............................... 3,389 (2,708) -------- -------- Total adjustments ................................ 2,134 (6,786) -------- -------- Net cash provided by operating activities . 13,968 3,147 CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of marketable securities ............................ (11,689) (71,763) Proceeds from sale of marketable securities .................. 14,246 49,125 Proceeds from sale of fixed assets ........................... 18 139 Capital expenditures ......................................... (1,652) (2,305) Net proceeds from sale of discontinued operations ............ -- 1,313 -------- -------- Net cash provided by (used in) investing activities .................... 923 (23,491) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from issuance of common stock ....................... 818 3,612 Dividends paid to shareholders ............................... (4,403) (4,212) Purchase of treasury stock ................................... (26,648) (948) -------- -------- Net cash (used in) financing activities ... (30,233) (1,548) Effect of exchange rates ..................................... (484) 468 -------- -------- Net (decrease) in cash and cash equivalents .................. (15,826) (21,424) Cash and cash equivalents at beginning of period ............. 73,064 93,443 -------- -------- Cash and cash equivalents at end of period ................... $ 57,238 $ 72,019 ======== ======== CASH PAID DURING THE PERIOD FOR: Interest ................................................ $ 35 $ 46 Income taxes ............................................ $ 2,671 $ 7,992
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE CONSOLIDATED FINANCIAL STATEMENTS. 5 6 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 - INTERIM CONSOLIDATED FINANCIAL STATEMENTS The accompanying unaudited interim consolidated financial statements have been prepared by Russ Berrie and Company, Inc. and Subsidiaries (the "Company") in accordance with generally accepted accounting principles for interim financial reporting and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared under generally accepted accounting principles have been condensed or omitted pursuant to such principles and regulations. The information furnished reflects all adjustments which are, in the opinion of management, necessary for a fair presentation of the Company's financial position, results of operations and cash flows for the interim periods presented. Results for interim periods are not necessarily an indication of results to be expected for the year. This report on Form 10-Q for the three months ended March 31, 1999 should be read in conjunction with the Company's annual report on Form 10-K for its year ended December 31, 1998. Certain prior year amounts have been reclassified to conform with current year's presentation. Investment and other income-net for the three months ended March 31, 1998 includes income of $1,828,000 before tax or $1,152,000 ($0.05 per share) after tax for the completion of a transitional agreement related to the sale of the Company's subsidiary Papel/Freelance, Inc. NOTE 2 - EARNINGS PER SHARE A reconciliation of weighted average common shares outstanding to weighted average common shares outstanding assuming dilution is as follows:
THREE MONTHS ENDED MARCH 31, 1999 1998 ---------- ---------- Average common shares outstanding .................... 22,008,000 22,135,000 Dilutive effect of common shares issuable (1) ........ 158,000 273,000 ---------- ---------- Average common shares outstanding assuming dilution .. 22,166,000 22,408,000 ========== ==========
(1) Issuable under stock option plans. The Notes to these consolidated financial statements reflect basic earnings per share unless otherwise stated or indicated. NOTE 3 - DIVIDENDS Cash dividends of $4,403,005 ($0.20 per share) were paid on March 15, 1999 to shareholders of record of the Company's Common Stock on March 1, 1999. Cash dividends of $4,211,952 ($0.19 per share) were paid in the three month period ended March 31, 1998. 6 7 NOTE 4 - COMPREHENSIVE INCOME Effective January 1, 1998, the Company adopted the provisions of Statement No. 130, Reporting Comprehensive Income, which modifies the financial statement presentation of comprehensive income and its components. Comprehensive income, representing all changes in Shareholders' equity during the period other than changes resulting from issuance or repurchase of the Company's common stock and payment of dividends, is reconciled to net income for the three months ended March 31, 1999 and 1998 as follows:
1999 1998 ------------ ------------ Net income ............................................... $ 11,834,000 $ 9,933,000 Other comprehensive income (loss), net of taxes Foreign currency translation adjustments ........... (1,577,000) (536,000) Net unrealized gain on securities available-for-sale 202,000 186,000 ------------ ------------ Other comprehensive (loss) ............................... (1,375,000) (350,000) ------------ ------------ Comprehensive income ..................................... $ 10,459,000 $ 9,583,000 ============ ============
NOTE 5 - PENDING ACCOUNTING CHANGE In June 1998, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities" (SFAS 133) which establishes accounting and reporting standards requiring that every derivative instrument (including certain derivative instruments embedded in other contracts) be recorded in the balance sheet as either an asset or liability measured at its fair value. SFAS 133 requires that changes in the derivative's fair value be recognized currently in earnings unless specific hedge accounting criteria are met. Special accounting for qualifying hedges allows a derivative's gains and losses to offset related results on the hedged item in the income statement, and requires that a company must formally document, designate, and assess the effectiveness of transactions that receive hedge accounting. SFAS 133 is effective for fiscal years beginning after June 15, 1999. A company may also implement SFAS 133 as of the beginning of any fiscal quarter after issuance (that is, fiscal quarters beginning June 16, 1998 and thereafter). SFAS 133 cannot be applied retroactively. SFAS 133 must be applied to (a) derivative instruments and (b) certain derivative instruments embedded in hybrid contracts that were issued, acquired, or substantively modified after December 31, 1997 (and, at the Company's election, before January 1, 1998). The Company has not yet quantified the impacts of adopting SFAS 133 on the financial statements and has not determined the timing of or method of adoption, however, such adoption could increase volatility in earnings and other comprehensive income. 7 8 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 1998 The Company's net sales for the three months ended March 31, 1999 were $75,403,000 compared to $74,636,000 for the three months ended March 31, 1998. This represents an increase of $767,000 or 1.0 %. Net sales in the quarter ended March 31, 1999 reflect the continued positive response of customers to the Company's product line focusing on coordinated themes of product offerings while the Company has become more account-driven, selling its products line, in depth, to fewer customers with a reduced salesforce. Cost of sales were 40.2% of net sales for the three months ended March 31, 1999 compared to 43.9% for the same period in 1998. This percentage decrease primarily reflects higher gross profit margins on sales of certain of the Company's product line concepts and the successful efforts to manage inventory levels, resulting in a reduced need to effect sales through other than normal distribution channels and lower provisions required for inventory. Selling, general and administrative expense was $28,768,000 or 38.2% of net sales for the three months ended March 31, 1999 compared to $29,859,000 or 40.0% of net sales for the three months ended March 31, 1998, a decrease of $1,091,000 or 3.7% compared to the prior year. This decrease is due primarily to lower costs of the reduced salesforce and realization of cost savings from the closing of its Petaluma, California administrative operations. Investment and other income of $2,022,000 for the three months ended March 31, 1999 compares to $3,176,000 for the three months ended March 31, 1998. Included in investment and other income for the three months ended March 31, 1998 is income of $1,828,000 for the completion of a transitional agreement related to the sale of the Company's subsidiary, Papel/Freelance, Inc. Excluding the income from this transitional agreement, investment and other income increased $674,000. This increase can be primarily related to increased investment income attributable to the Company's investment portfolio resulting from higher investment balances. The provision for income taxes as a percent of income before taxes for the three months ended March 31, 1999 was 35.6% compared to 34.7% in the same period in the prior year. Net income for the three months ended March 31, 1999 of $11,834,000 compares to net income of $9,933,000 for the same period last year. Included in the results for the three months ended March 31, 1998 is income of $1,152,000, after tax, for the completion of a transitional agreement related to the sale of the Company's subsidiary Papel/Freelance, Inc. Excluding the income from this transitional agreement, net income from operations increased $3,053,000 or 34.8%. This increase is attributed to the slight increase in net sales, improved gross profit margins, the decrease in selling, general and administrative expense and increased investment income. 8 9 YEAR 2000 COMPLIANCE The Company is dependent upon Information Technology (IT) systems in many aspects of its business and relies upon third parties who are also dependent on IT systems. Many existing IT programs use only two digits to identify a year in the date field and were designed and developed without considering the impact of the upcoming Year 2000. If not corrected or replaced, many computer applications could fail or create inaccurate results by or at the Year 2000 or in computations utilizing the date field (i.e. read the year 2000 as 1900 or something else). The Company has a program (Year 2000 Program) underway, more fully described below, intended to timely identify, mitigate and/or prevent the adverse effects of the Year 2000 issue through an analysis of its own IT and non-IT systems, and to pursue the Year 2000 compliance of its critical third-party relationships. STATE OF READINESS: The Company has completed a comprehensive review of its IT systems and is still analyzing its non-IT systems and critical third-party relationships to identify those that may be affected by the Year 2000 issue. The Company's current Year 2000 status is as follows: - - The Company has undertaken a project to implement a new packaged computer software system for the global organization. The new enterprise-wide system will replace the current custom and packaged software that the Company utilizes to operate and manage its business. Improvements in the Company's operational efficiency are expected. The new enterprise software system is Year 2000 compliant and the Company has obtained Year 2000 warranties or certifications from the major software suppliers involved with its new computer system. The implementation is expected to be completed by the end of the second quarter of 1999 for the Company's domestic operations and by the end of 1999 for the Canadian and European operations. The Company's Far East operations have modified its legacy systems and are expected to complete the installation and testing of Year 2000 Compliance by the end of the second quarter of 1999. Certain of the Company's domestic information will continue to be analyzed and certain historical information will be maintained using portions of the Company's current legacy systems which are being modified and tested to become Year 2000 compliant. - - The Company has developed a process for analyzing its non-IT systems and critical third-party relationships for Year 2000 compliance and expects to complete substantially all of such analysis by the end of the second quarter of 1999. The Company has inquired as to the Year 2000 readiness of each of such parties determined by management to be critical or important to the Company's business and is seeking certifications of Year 2000 compliance from them. The Company will continue to pursue such Year 2000 compliance certification from each critical third-party relationship and, if necessary, begin its contingency plan of identifying alternative goods or service providers that are able to certify Year 2000 compliance. Despite the Company's specific efforts with respect to non-IT systems and critical third-party relationships, there is no absolute assurance that Year 2000 risks from non-IT systems and critical third-party relationships will be completely eliminated and will, therefore, not have a material adverse effect on the Company's operations and financial condition. 9 10 COST: The total cost of the project including hardware, packaged software and project implementation is expected to be approximately $20,000,000 including the Company's foreign operations. Hardware, software and certain project costs will be capitalized as fixed assets and amortized over their useful lives. The remainder of the costs will be expensed as incurred. At March 31, 1999, approximately $16,200,000 has been incurred of which $10,200,000 and $6,000,000 have been capitalized and expensed, respectively. All historical and future costs have been and will continue to be funded out of existing cash and cash flows from operations. RISKS: The inability of IT and non-IT systems, in general, to accommodate dates after 1999 may cause disruptions throughout the world in the telecommunication, banking, credit card, transportation, utility, manufacturing, and other industries, as well as, many governmental services. If such disruptions occur, it is possible they could have a material adverse effect on businesses in general and on the Company in particular. Based upon currently available information, management believes that the Company will meet its compliance goals with respect to its IT systems and does not anticipate that the cost of effecting Year 2000 compliance, in excess of that described above, will have a material impact on the Company's financial condition, results of operations or liquidity. Nevertheless, achieving Year 2000 compliance is dependent upon many factors, some of which are not completely within the Company's control. Should either the Company's internal IT or non-IT systems or the internal systems of one of more of its critical third-party relationships, or their critical third-party relationships, fail to achieve Year 2000 compliance, there could be a material adverse effect on the Company's business and its results of operations. Since the Company has not completed the data gathering phase, with respect to non-IT systems and critical third parties, of its Year 2000 Program, it cannot yet quantify the costs, if any, that may be required to remedy those non-IT systems or incurred in identifying and switching to compliant third parties, if necessary. The Company does rely heavily on numerous, foreign manufacturers with approximately 88% of its inventory purchases being produced in the Far East. The Company is currently assessing the status of such manufacturers and their dependence upon IT or non-IT systems, which it expects to complete by the end of the second quarter of 1999. There is no absolute assurance that the Company's business operations will not be disrupted if certain of these manufacturers are unable to timely deliver product to the Company in the Year 2000; however, during 1998 no individual supplier accounted for more than 9% and the five largest suppliers in the aggregate did not account for more than 32% of the Company's purchases. CONTINGENCY PLANS: The Company has certain contingency options that are available in the event its Year 2000 Program for internal IT is not successful. If the Company cannot be assured during the second quarter of 1999, that the worldwide implementation of its enterprise-wide system, will be completed in the required timeframe, the Company will make a decision whether to complete the modifications already begun of its current legacy systems to become compliant. The Company estimates that the incremental effort to complete further evaluation, make the necessary modifications of active programs, and test and implement such changes would be completed by the end of the third quarter of 1999. 10 11 If the Company determines that either its non-IT systems or critical third-party relationships will not be compliant, it will either obtain alternative non-IT systems, or in the case of third parties, switch to other vendors or suppliers which are Year 2000 compliant, if necessary. While there are no contingency plans that cover every possible failure, the Company intends to monitor and update its contingency plans and develop additional potential solutions throughout the implementation of its Year 2000 Program. The Company is expending a significant amount of effort and resources towards its Year 2000 Program; however, based upon the risks previously identified, there is no absolute assurance that Year 2000 risks will not have a material adverse effect on the Company's operations and financial condition regardless of the efforts of its Year 2000 Program and various contingency plans. LIQUIDITY AND CAPITAL RESOURCES At March 31, 1999, the Company had cash and cash equivalents and marketable securities of $207,209,000 compared to cash and cash equivalents and marketable securities of $225,823,000 at December 31, 1998. Working capital requirements during the three months ended March 31, 1999 were met entirely through internally generated funds. The Company remains in a highly liquid position and believes that the resources available from investments, operations and bank lines of credit are sufficient to meet the foreseeable requirements of its business. At March 31, 1999, the Company had marketable securities of $149,971,000. These investments consist of U.S. government obligations, municipal obligations and preferred stock. The objective of the investment portfolio is to maximize after tax returns while minimizing risk. The Company's portfolio of preferred securities investments are subject to market fluctuations based largely, but not exclusively, on the securities' sensitivity to changes in interest rates. By maintaining an economic hedge consisting of government futures contracts and options, the Company seeks to reduce interest rate related risk. The portfolio of preferred securities and futures contracts and options position are intended to produce offsetting capital gains and losses as interest change. The Company enters into forward exchange contracts and currency options, principally to serve as economic hedges of the currency risk associated with the purchase of inventory and the repayment of intercompany loans by its European and Canadian operations. Gains and losses, related to contracts accounted for as hedges, are reported as a component of the related transactions. The Company does not anticipate any material adverse impact on its results of operations or financial position from these contracts. In January 1999, the Board of Directors authorized the Company to repurchase an additional 1,000,000 shares of common stock for a total authorization of 5,000,000 shares. During the three months ended March 31, 1999, the Company repurchased 1,074,200 shares for $26,648,000. As of March 31, 1999, 4,025,300 shares have been repurchased since the beginning of the Company's stock repurchase program in March, 1990. 11 12 FACTORS THAT MAY AFFECT FUTURE RESULTS AND FINANCIAL CONDITION This filing of the Form 10-Q contains forward-looking statements. Additional written and oral forward-looking statements may be made by the Company from time to time. The Private Securities Litigation Reform Act of 1995 provides a safe-harbor for forward-looking statements. The Company cautions readers that results predicted by forward-looking statements, including, without limitation, those relating to the Company's future business prospects, revenues, working capital, liquidity, capital needs, interest costs, and income are subject to certain risks and uncertainties that could cause actual results to differ materially from those indicated in the forward-looking statements. Specific risks and uncertainties include, but are not limited to, the Company's ability to continue to manufacture its products in the Far East, the seasonality of revenues, the actions of competitors, ability to increase production capacity, price competition, the effects of government regulation, possible delays in the introduction of new products, customer acceptance of products, the possible effects of Year 2000 issues and other factors. 12 13 PART II - OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K a) Documents filed as part of this Report. 27.1 Financial Data Schedule. b) During the quarter ended March 31, 1999, no reports on Form 8-K were filed. 13 14 SIGNATURES Pursuant to the requirements of Section 13 or 15 (d) 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. RUSS BERRIE AND COMPANY, INC. (Registrant) 5/14/99 By /s/ Eric R. Lohwasser - --------------------- ------------------------------- Date Eric R. Lohwasser Vice President - Finance, Chief Financial Officer 14 EX-27.1 2 FINANCIAL DATA SCHEDULE
5 1,000 3-MOS DEC-31-1999 JAN-01-1999 MAR-31-1999 57,238 149,971 67,496 3,045 36,548 316,510 62,004 26,061 361,411 36,739 0 0 0 2,525 322,147 361,411 75,403 75,403 0 30,277 0 0 0 18,380 6,546 11,834 0 0 0 11,834 0.54 0.53
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