-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, PSOYukWqmp9PL8Wajw4FWR8u50y91Dwtvs+7XgDwlFvKw2d1QWxh09ZBjBu1mayg Mun8SKRe7RrLft1Fzku1EA== 0000920049-95-000058.txt : 19950516 0000920049-95-000058.hdr.sgml : 19950516 ACCESSION NUMBER: 0000920049-95-000058 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950331 FILED AS OF DATE: 19950515 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: QUAKER CHEMICAL CORP CENTRAL INDEX KEY: 0000081362 STANDARD INDUSTRIAL CLASSIFICATION: MISCELLANEOUS PRODUCTS OF PETROLEUM & COAL [2990] IRS NUMBER: 230993790 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-07154 FILM NUMBER: 95539124 BUSINESS ADDRESS: STREET 1: ELM AND LEE STS CITY: CONSHOHOCKEN STATE: PA ZIP: 19428 BUSINESS PHONE: 2158324000 MAIL ADDRESS: STREET 1: ELM & LEE STS CITY: CONSHOHOCKEN STATE: PA ZIP: 19428 10-Q 1 QUARTERLY REPORT 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 March 31, 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 0-7154 ------ QUAKER CHEMICAL CORPORATION ------------------------------------------------------- (Exact name of registrant as specified in its charter) Pennsylvania 23-0993790 - ---------------------------------- -------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) Elm and Lee Streets, Conshohocken, Pennsylvania 19428-0809 ----------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code 610-832-4000 -------------- Not Applicable ----------------------------------------------------------------- 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 ----- ----- APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Number of Shares of Common Stock Outstanding on April 28, 1995 8,801,305 -------------- PART I. FINANCIAL INFORMATION QUAKER CHEMICAL CORPORATION AND CONSOLIDATED SUBSIDIARIES CONDENSED FINANCIAL INFORMATION The following condensed financial statements are filed as part of this quarterly report on Form 10-Q: Consolidated Balance Sheet at March 31, 1995 and December 31, 1994 Consolidated Statement of Income for the three months ended March 31, 1995 and 1994 Consolidated Statement of Cash Flows for the three months ended March 31, 1995 and 1994 * * * * * * * * * * NOTE TO CONDENSED FINANCIAL INFORMATION The attached condensed financial information has been prepared in accordance with instructions for Form 10-Q and, therefore, does not include all financial note information which might be necessary for a fair presentation in accordance with generally accepted accounting principles. Such condensed financial information is unaudited, but in the opinion of management, includes all adjustments, consisting only of normal recurring adjustments and accruals, necessary for a fair presentation of results for the periods indicated. The net income reported for the periods should not necessarily be regarded as indicative of net income on an annualized basis; however, significant variations from the results for the same period of the previous year, if any, have been disclosed in the accompanying management's discussion and analysis. - 2 - Quaker Chemical Corporation Consolidated Balance Sheet (dollars in thousands) March 31, December 31, 1995 1994 (Unaudited) * - ------------------------------------------------------------------------------- Assets Current assets Cash and cash equivalents $ 5,633 $ 11,345 Accounts receivable 48,951 43,841 Inventories Raw materials and supplies 8,794 8,795 Work in process and finished goods 10,791 9,042 Deferred income taxes 1,873 1,473 Prepaid expenses and other current assets 6,259 8,904 -------- -------- 82,301 83,400 -------- -------- Investments in and advances to associated companies 10,821 9,885 -------- -------- Property, plant and equipment, at cost Land 7,002 6,702 Buildings and improvements 36,495 34,529 Machinery and equipment 65,373 63,403 Construction in progress 2,927 1,015 -------- -------- 111,797 105,649 Less accumulated depreciation 57,555 53,955 -------- -------- 54,242 51,694 -------- -------- Excess of cost over net assets of acquired companies 12,825 12,262 Deferred income taxes 4,986 4,971 Other noncurrent assets 7,701 7,960 -------- -------- 25,512 25,193 -------- -------- $172,876 $170,172 ======== ======== * Condensed from audited financial statements. - 3 - Quaker Chemical Corporation Consolidated Balance Sheet (dollars in thousands) March 31, December 31, 1995 1994 (Unaudited) * - ------------------------------------------------------------------------------- Liabilities Current liabilities Short-term borrowings and current portions of long-term debt and capital leases $ 9,831 $ 8,062 Accounts payable 22,000 20,575 Dividends payable 1,500 Accrued liabilities 9,700 12,850 Estimated taxes on income 103 440 -------- -------- Total current liabilities 41,634 43,427 -------- -------- Long-term debt and capital leases 10,571 12,207 Deferred income taxes 3,101 3,081 Accrued postretirement benefits 8,818 8,767 Other noncurrent liabilities 6,395 6,410 -------- -------- Total noncurrent liabilities 28,885 30,465 -------- -------- 70,519 73,892 -------- -------- Minority interest in equity of subsidiary 2,548 2,603 -------- -------- Shareholders' equity Common stock, $1 par value; authorized 30,000,000 shares; issued (including treasury shares) 9,664,009 shares 9,664 9,664 Capital in excess of par value 759 649 Retained earnings 89,052 87,137 Foreign currency translation adjustments 14,347 9,856 -------- -------- 113,822 107,306 Treasury stock, shares held at cost; 1995 - 860,291, 1994 - 844,691 (14,013) (13,629) -------- -------- 99,809 93,677 -------- -------- $172,876 $170,172 ======== ======== * Condensed from audited financial statements - 4 - Quaker Chemical Corporation Consolidated Statement of Income Three Months Ended March 31, Unaudited (dollars in thousands except per share data) 1995 1994 - ------------------------------------------------------------------------------- Income Net sales $ 54,527 $ 45,093 Other income, net 154 358 -------- -------- 54,681 45,451 -------- -------- Costs and expenses Cost of goods sold 32,724 25,383 Selling, administrative and general expenses 18,521 16,354 -------- -------- 51,245 41,737 -------- -------- Income from operations 3,436 3,714 Interest expense (332) (330) Interest income 89 136 -------- -------- Income before taxes 3,193 3,520 -------- -------- Taxes on income 1,261 1,408 -------- -------- 1,932 2,112 Equity in net income of associated companies 90 237 Minority interest in net income of subsidiary (107) (100) -------- -------- Net income $ 1,915 $ 2,249 ======== ======== Per share data: Net income $0.22 $0.24 Dividends declared $0.17 $0.16 Based on weighted average number of shares outstanding 8,823,989 9,252,727 - 5 - Quaker Chemical Corporation Consolidated Statement of Cash Flows For the Three Months Ended March 31, 1995 1994 - ------------------------------------------------------------------------------- Cash flows from operating activities: Net income $ 1,915 $ 2,249 Adjustments to reconcile net income to net cash used in operating activities: Depreciation 1,708 1,820 Amortization 408 208 Equity in net income of associated companies (90) (237) Minority interest in earnings of subsidiary 107 100 Deferred income taxes (20) 400 Deferred compensation and other postretirement benefits 92 152 Net change in repositioning liability (367) (848) Other (243) 158 Increase (decrease) in cash from changes in current assets and liabilities net of acquisitions and divestitures: Accounts receivable (3,492) (2,575) Inventories (1,012) 347 Prepaid expenses (including taxes) and other current assets 567 693 Accounts payable and accrued liabilities (2,960) (3,286) Estimated taxes on income (323) (286) -------- -------- Net cash used in operating activities (3,710) (1,105) -------- -------- Cash flows from investing activities: Short-term investments 1,000 Dividends from associated companies 551 Investments in property, plant, equipment and other assets (2,033) (3,319) Companies/businesses acquired excluding cash (2,147) Investments in and advances to associated companies (323) Proceeds from the sale of patent, production technology and other related assets 2,000 Other 47 -------- -------- Net cash used in investing activities (356) (3,868) -------- -------- Cash flows from financing activities: Net increase in short-term borrowings 1,827 3,951 Repayment of long-term debt and capital leases (1,679) (1,768) Dividends paid (1,500) (1,433) Treasury stock (acquired) issued (274) 256 Other (3) -------- -------- Net cash (used in) provided by financing activities (1,626) 1,003 -------- -------- Effect of exchange rate changes on cash (20) 31 -------- -------- Net decrease in cash and cash equivalents (5,712) (3,939) Cash and cash equivalents at beginning of period 11,345 19,293 -------- -------- Cash and cash equivalents at end of period $ 5,633 $ 15,354 ======== ======== Supplemental cash flow information Cash paid for income taxes and interest was as follows: Income taxes $ 1,958 $ 1,264 Interest 560 556 -6- Management's Discussion and Analysis of Financial Condition and Results of Operations Liquidity and Capital Resources The working capital ratio at March 31, 1995 was 2.0 to 1 as compared to 1.9 to 1 at December 31, 1994, reflecting the continuation of an adequate level of liquidity necessary to support operations. The company's net cash position (cash and cash equivalents plus short-term investments less short-term borrowings and current portion of long-term debt and capital lease) declined $7.5 million during the quarter. This was due primarily to increased short-term borrowings associated with (i) seasonal cash needs, (ii) the replacement of maturing long-term obligations with short-term debt and (iii) increases in non-cash working capital (primarily increases in accounts receivable generated from higher sales). Working capital increased $.7 million during the quarter mainly as a result of the aforementioned increases in non-cash working capital. Other major sources and uses of cash in the quarter were a receipt of $2.0 million related to the 1993 sale of the SULFA-SCRUB (registered trademark) patents and technology, and dividend payments of $1.5 million. Comparison of First Quarter 1995 with First Quarter 1994 Consolidated net sales for the first quarter of 1995 increased $9.4 million (21%) due mainly to increased sales volume, particularly in Europe, and the appreciation of European currencies versus the U.S. dollar. However, income from operations and net income were each $.3 million lower than the same quarter in 1994 largely as a result of the short-term dampening effect of raw material cost inflation on margins. The increase in sales was due to a 12% increase in volume; a 7% improvement associated with currency translation; and an increase of 2% from an acquisition of a European metalworking business. Operating margins as a percentage of sales declined due to the aforementioned negative effect of rising raw material costs. Other income decreased mainly as a result of foreign exchange transaction losses on dollar denominated sales from the company's European operations. These losses offset in large part the first quarter positive impact of currency translation which approximated $.03 per share. The decrease in equity in net income from associated companies was primarily due to business development investment costs in the company's Fluid Recycling Services joint venture. The company continues to be encouraged by sales growth trends, especially in Europe. In addition, programs have been and are still being implemented to increase prices (the effect of which should be more evident toward the end of the second quarter) in order to recover margin losses associated with raw material cost inflation. - 7 - PART II. OTHER INFORMATION Items 1-5 are inapplicable and have been omitted. Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits. Exhibit 27-Financial Data Schedule (b) Reports on Form 8-K. No report on Form 8-K was filed during the quarter for which this report is filed. * * * * * * * * * 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. QUAKER CHEMICAL CORPORATION ------------------------------ (Registrant) RICHARD J. FAGAN ----------------------------- Richard J. Fagan, officer duly authorized to sign this report, Corporate Controller, Acting Corporate Treasurer and Principal Financial and Chief Accounting Officer Date: May 15, 1995 - 9 - EX-27 2 ART. 5 FDS FOR 1ST QUARTER 10-Q
5 UNAUDITED 1,000 3-MOS DEC-31-1995 MAR-31-1995 5,633 0 49,509 558 19,585 82,301 111,797 57,555 172,876 41,634 5,000 9,664 0 0 90,145 172,876 54,527 54,681 32,724 51,245 0 0 332 3,193 1,261 1,915 0 0 0 1,915 .22 .22
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