-----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, KRX9rLWvwfI257Wak8MSegcnGRfDKp3qpkW4w1nDgSteTP+HQynwGqz6KuxWExo0 O/v4yDqGIqKVMvq9dHAgkQ== 0000818479-97-000011.txt : 19970815 0000818479-97-000011.hdr.sgml : 19970815 ACCESSION NUMBER: 0000818479-97-000011 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19970814 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: DENTSPLY INTERNATIONAL INC /DE/ CENTRAL INDEX KEY: 0000818479 STANDARD INDUSTRIAL CLASSIFICATION: DENTAL EQUIPMENT & SUPPLIES [3843] IRS NUMBER: 391434669 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-16211 FILM NUMBER: 97661566 BUSINESS ADDRESS: STREET 1: 570 W COLLEGE AVE CITY: YORK STATE: PA ZIP: 17405 BUSINESS PHONE: 7178460256 MAIL ADDRESS: STREET 1: 570 W COLLEGE AVE CITY: YORK STATE: PA ZIP: 17405 FORMER COMPANY: FORMER CONFORMED NAME: GENDEX CORP DATE OF NAME CHANGE: 19920703 10-Q 1 10-Q 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 June 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 0-16211 DENTSPLY International Inc. - ----------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 39-1434669 - ----------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 570 West College Avenue, P. O. Box 872, York, PA 17405-0872 - ----------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (717) 845-7511 ---------------------- (Registrant's telephone number, including area code) 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. ( X ) Yes ( ) No Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: At August 6, 1997 the Company had 26,999,378 shares of Common Stock outstanding, with a par value of $.01 per share. Page 1 of 19 ---- Exhibit Index at Page 17 ---- DENTSPLY INTERNATIONAL INC. FORM 10-Q For Quarter Ended June 30, 1997 ------------------------ INDEX ----- Page No. -------- PART I - FINANCIAL INFORMATION (unaudited) Item 1 - Financial Statements Consolidated Condensed Balance Sheets............ 3 Consolidated Condensed Statements of Income...... 4 Consolidated Condensed Statements of Cash Flows.. 5 Consolidated Condensed Statement of Stockholders' Equity........................... 7 Notes to Unaudited Consolidated Condensed Financial Statements........................... 8 Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations.... 12 PART II - OTHER INFORMATION Item 1 - Legal Proceedings............................ 15 Item 4 - Submission of Matters to a Vote of Security Holders........................... 15 Item 6 - Exhibits and Reports on Form 8-K............. 15 Signatures........................................... 16 2 PART I FINANCIAL INFORMATION Item 1. FINANCIAL STATEMENTS DENTSPLY INTERNATIONAL INC. CONSOLIDATED CONDENSED BALANCE SHEETS (unaudited) June 30, December 31, 1997 1996 ASSETS ------------ ------------ Current assets: (in thousands) Cash and cash equivalents $ 7,791 $ 5,619 Accounts and notes receivable-trade, net 107,258 101,977 Inventories 117,574 125,398 Prepaid expenses and other current assets 34,210 23,752 --------- --------- Total Current Assets 266,833 256,746 Property, plant and equipment, net 142,418 141,458 Other noncurrent assets, net 13,170 13,259 Identifiable intangible assets, net 91,405 59,787 Costs in excess of fair value of net assets acquired, net 226,224 196,412 --------- --------- Total Assets $ 740,050 $ 667,662 LIABILITIES AND STOCKHOLDERS' EQUITY ========= ========= Current liabilities: Accounts payable and accrued liabilities $ 94,789 $ 86,224 Income taxes payable 28,962 30,264 Notes payable and current portion of long-term debt 25,435 26,711 --------- --------- Total Current Liabilities 149,186 143,199 Long-term debt 121,899 75,109 Deferred income taxes 29,225 30,000 Other liabilities 46,030 49,467 --------- --------- Total Liabilities 346,340 297,775 --------- --------- Minority interests in consolidated subsidiaries 3,964 4,297 Stockholders' equity: --------- --------- Preferred stock, $.01 par value; .25 million shares authorized; no shares issued - - Common stock, $.01 par value; 100 million shares authorized; 27.1 million shares issued at June 30, 1997 and December 31,1996 271 271 Capital in excess of par value 150,223 150,031 Retained earnings 267,082 237,300 Cumulative translation adjustment (12,661) (4,278) Employee stock ownership plan reserve (10,256) (11,016) Treasury stock, at cost, .1 million shares at June 30, 1997 and .2 million shares at December 31, 1996 (4,913) (6,718) --------- --------- Total Stockholders' Equity 389,746 365,590 --------- --------- Total Liabilities and Stockholders' Equity $ 740,050 $ 667,662 ========= ========= See accompanying notes to unaudited consolidated condensed financial statements. 3 DENTSPLY INTERNATIONAL INC. CONSOLIDATED CONDENSED STATEMENTS OF INCOME (unaudited) Three Months Ended Six Months Ended June 30, June 30, -------------------- -------------------- 1997 1996 1997 1996 -------- -------- -------- -------- (in thousands, except per share data) Net sales $178,307 $165,029 $350,666 $320,939 Cost of products sold 87,536 83,389 171,845 162,371 -------- -------- -------- -------- 90,771 81,640 178,821 158,568 Selling, general and administrative expenses 58,252 50,412 118,247 100,439 -------- -------- -------- -------- Operating income 32,519 31,228 60,574 58,129 Interest expense 3,466 2,631 6,217 5,726 Interest income (466) (404) (891) (621) Other (income) expense, net 180 (441) (1,905) (1,507) -------- -------- -------- -------- Income before income taxes 29,339 29,442 57,153 54,531 Provision for income taxes 11,496 11,672 22,386 21,774 -------- -------- -------- -------- Net income $ 17,843 $ 17,770 $ 34,767 $ 32,757 ======== ======== ======== ======== Earnings per common share $.66 $.66 $1.29 $1.22 Dividends per common share $.0925 $.0825 $.185 $.165 Weighted average common shares outstanding 26,945 26,958 26,934 26,955 See accompanying notes to unaudited consolidated condensed financial statements. 4 DENTSPLY INTERNATIONAL INC. CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (unaudited) Six Months Ended June 30, ------------------- 1997 1996 -------- -------- (in thousands) Cash flows from operating activities: Net income $ 34,767 $ 32,757 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 7,975 7,596 Amortization 8,046 6,584 Other, net (16,354) (9,263) -------- -------- Net cash provided by operating activities 34,434 37,674 -------- -------- Cash flows from investing activities: Acquisition of businesses, net of cash acquired (58,510) (77,317) Property, plant and equipment additions (17,096) (8,960) Proceeds from disposal of Medical business - 7,500 Other, net 713 (294) -------- -------- Net cash used in investing activities (74,893) (79,071) -------- -------- Cash flows from financing activities: Debt repayment (30,842) (28,904) Proceeds from long-term debt 83,616 71,307 Increase (decrease) in bank overdrafts and other short-term debt (7,097) 4,821 Other, net (2,219) (3,399) -------- -------- Net cash provided by financing activities 43,458 43,825 -------- -------- Effect of exchange rate changes on cash and cash equivalents (827) (954) -------- -------- Net increase in cash and cash equivalents 2,172 1,474 Cash and cash equivalents at beginning of period 5,619 3,974 -------- -------- Cash and cash equivalents at end of period $ 7,791 $ 5,448 ======== ======== Supplemental disclosures of cash flow information: Interest paid $ 3,898 $ 3,032 Income taxes paid 20,909 18,327 Non-cash transactions: Note receivable for inventory and fixed assets associated with arbitration ruling terminating the Implant Distribution Agreement 6,814 - Cancellation of loan receivable from acquired subsidiary 2,900 - Liabilities assumed from acquisitions 28,057 3,451 See accompanying notes to unaudited consolidated condensed financial statements. 5 DENTSPLY INTERNATIONAL INC. CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (unaudited) Supplemental disclosures of noncash transactions (in thousands): In January 1997, the Company purchased the assets of DW Industries, Inc. ("DW Industries") for $16.3 million and all of the capital stock of Laboratoire SPAD, S.A. ("SPAD") for $36.0 million. In March 1997, the Company purchased all of the capital stock of New Image Industries, Inc. ("New Image") for $10.9 million. In conjunction with the acquisitions, liabilities were assumed as follows: DW Industries SPAD New Image ------------- -------- --------- Fair value of assets acquired $ 16,629 $ 42,571 $ 32,123 Cash paid for assets or capital stock 16,253 35,992 10,858 -------- -------- -------- Liabilities assumed $ 376 $ 6,579 $ 21,265 ======== ======== ======== In January 1996, the Company purchased certain net assets of Tulsa Dental Products LLC for $75 million. In conjunction with the acquisition, liabilities were assumed as follows: Fair value of assets acquired $ 78,451 Cash paid for assets 75,000 -------- Liabilities assumed $ 3,451 ======== See accompanying notes to unaudited consolidated condensed financial statements. 6 DENTSPLY INTERNATIONAL INC. CONSOLIDATED CONDENSED STATEMENT OF STOCKHOLDERS' EQUITY (unaudited)
Capital in Cumulative Total Common Excess of Retained Translation Treasury Stockholders' Stock Par Value Earnings Adjustment ESOP Reserve Stock Equity (in thousands) ------ ----------- -------- ----------- ------------ --------- ------------ Balance at December 31, 1996 $ 271 $150,031 $237,300 $ (4,278) $(11,016) $ (6,718) $365,590 Exercise of stock options and warrants - (302) - - - 2,733 2,431 Tax benefit related to stock options and warrants exercised - 494 - - - - 494 Cash dividends declared, $.185 per share - - (4,985) - - - (4,985) Repurchase of 20,000 shares of common stock - - - - - (928) (928) Translation adjustment - - - (8,383) - - (8,383) Net change in ESOP reserve - - - - 760 - 760 Net income - - 34,767 - - - 34,767 ------ -------- -------- -------- -------- -------- -------- Balance at June 30, 1997 $ 271 $150,223 $267,082 $(12,661) $(10,256) $ (4,913) $389,746 ====== ======== ======== ======== ======== ======== ======== See accompanying notes to unaudited consolidated condensed financial statements.
7 DENTSPLY INTERNATIONAL INC. NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS -------------------------------------------------------------- JUNE 30, 1997 ------------- The accompanying interim consolidated condensed financial statements reflect all adjustments (consisting only of normal recurring adjustments) which in the opinion of management are necessary for a fair presentation of financial position, results of operations and cash flows for the interim periods. These interim financial statements conform with the requirements for interim financial statements and consequently do not include all the disclosures normally required by generally accepted accounting principles. Disclosures are updated where appropriate. NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES - ---------------------------------------- Principles of Consolidation - --------------------------- The interim consolidated condensed financial statements include the accounts of DENTSPLY International Inc. (the "Company") and its subsidiaries. Minority interests in net income of consolidated subsidiaries is not material and is included in other (income) expense, net. Inventories - ----------- Inventories are stated at the lower of cost or market. At June 30, 1997 and December 31, 1996, the cost of $11.7 million or 10% and $10.0 million or 8%, respectively, of inventories was determined by the last-in, first-out (LIFO) method. The cost of other inventories was determined by the first-in, first-out (FIFO) or average cost method. Property, Plant and Equipment - ----------------------------- Property, plant and equipment are stated at cost, net of accumulated depreciation. Except for leasehold improvements, depreciation for financial reporting purposes is computed by the straight-line method over the following estimated useful lives: buildings - generally 40 years; and machinery and equipment - 4 to 15 years. The cost of leasehold improvements is amortized over the shorter of the estimated useful life or the term of the lease. For income tax purposes, depreciation is computed using various methods. 8 Earnings per Common Share - ------------------------- Earnings per common share are based on the weighted average number of common shares outstanding. Common stock equivalents (options and warrants) had no material effect on the earnings per common share computation. All shares held by the DENTSPLY Employee Stock Ownership Plan are considered outstanding and are included in the earnings per common share computation. NOTE 2 - BUSINESS ACQUISITIONS - ------------------------------ In January 1997, the Company purchased the assets of DW Industries in a cash transaction valued at approximately $16.3 million and an earn-out based on the sales growth of the business. Headquartered in Las Vegas, Nevada, DW Industries is the leading manufacturer of disposable air-water syringe tips for use in clinical dental office procedures. Also in January 1997, the Company purchased all of the outstanding capital stock of Laboratoire SPAD for FF199.5 million in a cash transaction valued at approximately $36.0 million. SPAD, a division of GROUP MONOT, S.A. , is a leading French manufacturer and distributor of dental anesthetic and other dental products. In March 1997, the Company purchased all of the capital stock of New Image for $2.00 per share or approximately $10.9 million pursuant to a tender offer. New Image, which designs, develops, manufactures, and distributes intraoral cameras and computer imaging systems and related software exclusively for the dental market, is located in Carlsbad, California. The DW Industries, SPAD, and New Image acquisitions were accounted for under the purchase method of accounting. Accordingly, the results of operations of DW Industries, SPAD and New Image are included in the accompanying financial statements since the respective dates of the acquisitions. The purchase prices plus direct acquisition costs have been allocated on the basis of preliminary estimates of the fair values of assets acquired and liabilities assumed. The excess of acquisition cost over net assets acquired of $1.4 million for DW Industries, $31.4 million for SPAD, and $3.0 million for New Image is being amortized over 25 years. These acquisitions, individually and in the aggregate, are not expected to have a material impact on the Company's 1997 results; accordingly, pro forma information has been omitted. In July 1997, the Company purchased the dental assets of EFOS Corporation ("EFOS") for CDN $20.7 million in a cash transaction valued at approximately $15 million. EFOS, located in Toronto, Canada, is the developer and manufacturer of DENTSPLY's worldwide range of dental curing lights and amalgamators. Additionally, EFOS serves the dental market with protective eyewear products, replacement parts and curing light repair and service. Also in July 1997, the Company purchased the outstanding capital stock of SIMFRA S.A. ("SIMFRA") for FF23 million in a cash transaction valued at approximately $4 million. Located in Paris, SIMFRA is the exclusive importer of Maillefer instruments in France. 9 NOTE 3 - INVENTORIES - -------------------- Inventories consist of the following: June 30, December 31, 1997 1996 ------------ ------------ (in thousands) Finished goods $ 63,086 $ 73,650 Work-in-process 23,648 23,936 Raw materials and supplies 30,840 27,812 -------- -------- $117,574 $125,398 ======== ======== Pre-tax income was $.2 million lower in the six months ended June 30, 1997 as a result of using the LIFO method compared to the first-in, first- out (FIFO) method. If the FIFO method had been used to determine the cost of the LIFO inventories, the amounts at which net inventory is stated would be lower than reported at June 30, 1997 and December 31, 1996 by $1.5 million and $1.7 million, respectively. NOTE 4 - PROPERTY, PLANT AND EQUIPMENT - -------------------------------------- Property, plant and equipment consist of the following: June 30, December 31, 1997 1996 ------------ ------------ Assets, at cost: (in thousands) Land $ 15,040 $ 17,222 Buildings and improvements 68,080 68,185 Machinery and equipment 109,553 103,887 Construction in progress 10,743 8,505 -------- -------- 203,416 197,799 Less: Accumulated depreciation 60,998 56,341 -------- -------- $142,418 $141,458 ======== ======== NOTE 5 - NOTES PAYABLE AND LONG-TERM DEBT - ----------------------------------------- The increase from December 31, 1996 in Long-term debt ($46.8 million) was primarily due to utilization of the Company's credit facilities for the acquisition of DW, SPAD, and New Image (see Note 2). 10 NOTE 6 - IMPLANT BUSINESS - ------------------------- In March 1997, the American Arbitration Association's Commercial Arbitration Tribunal ordered a judgment in favor of the Company terminating, effective March 19, 1997, the Implant Distribution Agreement between Core-Vent Corporation and DENTSPLY's Implant Division. The sales, distribution and administrative functions acquired by the Company under the Implant Distribution Agreement, along with certain assets of the implant business, have been transferred back to Core-Vent Corporation. The noncancellable purchase commitment related to the Implant Distribution Agreement, described in footnote 13 in the Company's consolidated financial statements included in the 1996 Form 10-K, has been terminated. Sales for the Company's implant business were approximately $28 million in 1996. The implant business did not contribute to the profitability of the Company in 1996. The financial impact on 1997 earnings from transferring the implant business back to Core-Vent Corporation as a result of the judgment cannot be reasonably estimated at this time. 11 DENTSPLY INTERNATIONAL INC. Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations RESULTS OF OPERATIONS Quarter Ended June 30, 1997 Compared to Quarter Ended June 30, 1996 In the quarter ended June 30, 1997, net sales increased by $13.3 million, or 8.0%, to $178.3 million from $165.0 million in the same period of 1996. The growth came primarily from acquisitions. Excluding acquisitions, sales in the United States were flat primarily due to the relocation of the Preventive Care Division's manufacturing facilities to a new plant in York, Pennsylvania which had a significant adverse impact on shipments. Sales in the United States were also adversely impacted by the arbitration ruling in the first quarter of 1997 which terminated the Implant Distribution Agreement between Core-Vent Corporation and DENTSPLY's Implant Division. Sales in Europe, excluding acquisitions, increased slightly despite a significant adverse impact on sales caused by the strong U.S. dollar. Strong sales growth continued in Latin America and the Pacific Rim. Gross profit increased $9.1 million, or 11.2%, to $90.8 million from $81.7 million in the second quarter of 1996 as a result of higher net sales. As a percentage of sales, gross profit increased from 49.5% in the second quarter of 1996 to 50.9% in the same period of 1997. In 1996 acquisition accounting for Maillefer and Tulsa had an adverse impact on the gross profit percentage while the percentage improved in 1997 due to improved operating performance in several United States and European manufacturing locations and a favorable mix of higher margin products in the Pacific Rim and Latin America. Selling, general and administrative expenses increased $7.8 million, or 15.6%. As a percentage of sales, expenses increased from 30.5% in the second quarter of 1996 to 32.7% for the same period in 1997. A large part of the percentage increase was from businesses acquired in 1997, principally the New Image business. Excluding 1997 acquisitions, selling, general and administrative expenses increased from 30.5% of sales in the second quarter of 1996 to 30.9% of sales in the same period of 1997. Expenses for legal proceedings associated with the Tycom Corporation litigation, which has been ongoing since 1996, were significantly higher in 1997. Without acquisitions and the Tycom litigation, expenses as a percentage of sales in the second quarter of 1997 were equal to the same period in 1996. The $.8 million increase in interest expense is primarily due to debt related to acquisitions made in the first half of 1997. Income before income taxes, net income and earnings per share were flat compared to the second quarter of 1996 principally due to the relocation of the Preventive Care Division, the negative impact of the strong U.S. dollar on the translation of sales and earnings, and the New Image business. 12 Six Months Ended June 30, 1997 Compared to Six Months Ended June 30, 1996 For the six months ended June 30, 1997, net sales increased $29.8 million, or 9.3%, to $350.7 million from $320.9 million in the same period of 1996. The increase primarily came from acquisitions. Sales in the U.S. increased slightly but were negatively impacted by the relocation of the Preventive Care Division's manufacturing facilities to a new plant in York, Pennsylvania and the termination of the Implant Distribution Agreement between Core-Vent Corporation and DENTSPLY's Implant Division. Sales in Europe showed a small increase despite a significant adverse impact on sales caused by the strong U.S. dollar. Sales growth in the Pacific Rim and Latin America continued to be strong. Gross profit increased $20.3 million, or 12.8%, to $178.8 million from $158.5 million in the first six months of 1996 as a result of higher net sales. As a percentage of net sales, gross profit increased from 49.4% in the first six months of 1996 to 51.0% for the same period in 1997. In 1996 acquisition accounting for Maillefer and Tulsa had an adverse impact on the gross profit percentage while the percentage improved in 1997 due to improved operating performance in several United States and European manufacturing locations and a favorable mix of higher margin products in the Pacific Rim and Latin America. Selling, general and administrative expenses increased $17.8 million or 17.7%. As a percentage of sales, expenses increased from 31.3% in the first six months of 1996 to 33.7% for the same period of 1997. Expenses increased as a percentage of sales due to the higher ratio of expenses to sales in the New Image business; expansion of the endodontic salesforce and start-up expenses for the group practices business unit in the United States; continued emphasis on upgrading the information systems in the United States and Europe; increased spending for the new China location in the Pacific Rim; increased research and development expenses; and increased costs associated with the Tycom Corporation legal proceedings. Income before income taxes increased $2.6 million, or 4.8%, while net income increased $2.0 million, or 6.1%, from the first six months of 1996. Earnings per common share increased from $1.22 in 1996 to $1.29 in 1997, or 5.7%. LIQUIDITY AND CAPITAL RESOURCES In January 1997, the Company acquired the assets of DW Industries for $16.3 million in cash and all of the outstanding shares of SPAD for $36.0 million in cash. In March 1997, the Company acquired all of the outstanding shares of New Image for $10.9 million. These transactions were funded from the Company's existing $175.0 million Bank Revolving Loan Facility and short- term bank borrowings. Investing activities for the six months ended June 30, 1997 include capital expenditures of $17.1 million. The Company's current ratio was 1.8 with working capital of $117.6 million at June 30, 1997. This compares with a current ratio of 1.8 and working capital of $113.5 million at December 31, 1996. 13 The Company expects to be able to finance cash requirements, including capital expenditures, the acquisition of EFOS and SIMFRA, stock repurchases and debt service from funds generated from operations and amounts available under the existing Bank Revolving Loan Facility. For the six months ended June 30, 1997, cash flows from operating activities were $34.4 million compared to $37.7 million for the six months ended June 30, 1996. The decrease of $3.3 million results primarily from higher income tax payments and increases in prepaid and other current assets in 1997. IMPACT OF INFLATION The Company has generally offset the impact of inflation on wages and the cost of purchased materials by improving operating efficiencies and increasing selling prices to the extent permitted by market conditions. EARNINGS PER SHARE In February 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 128, Earnings per Share ("SFAS 128"). This Statement simplifies the standards for computing earnings per share ("EPS") and makes them comparable to international EPS standards. It replaces the presentation of primary EPS with a presentation of basic EPS and requires dual presentation of basic and diluted EPS on the face of the income statement of all entities with complex capital structures. SFAS 128 also requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. Since the Company's stock options do not dilute EPS by more than three percent, they have been excluded from the denominator of earnings per common share as reported in the accompanying financial statements; thus, earnings per common share is equal to basic EPS as computed under SFAS 128. Had SFAS 128 been adopted in the first six months of 1997, diluted EPS would have been computed as follows (in thousands, except per share amounts): Income Shares Per Share (Numerator) (Denominator) Amount ----------- ------------- --------- Basic EPS $ 34,767 26,934 $1.29 Incremental shares from assumed exercise of dilutive options and warrants - 130 - -------- ------ Diluted EPS $ 34,767 27,064 $1.28 ======== ====== Item 3 - Quantitative and Qualitative Disclosures About Market Risk Not required. 14 PART II OTHER INFORMATION Item 1 - Legal Proceedings DENTSPLY and its subsidiaries are from time to time parties to lawsuits arising out of their respective operations. The Company believes that pending litigation to which DENTSPLY is a party will not have a material adverse effect upon its consolidated financial position or results of operations. Item 4 - Submission of Matters to a Vote of Security Holders (a) On May 21, 1997, the Company held its 1997 Annual Meeting of Stockholders. (b) Not applicable. (c) The following matters were voted upon at the Annual Meeting, with the results indicated: 1. Election of Class II Directors: Votes Authority Broker For Withheld Non-Votes ---------- --------- --------- Leslie A. Jones 23,610,010 783,840 -0- Edgar H. Schollmaier 23,627,321 766,529 -0- 2. Proposal to ratify the appointment of KPMG Peat Marwick LLP, independent certified accountants, to audit the books and accounts of the Company for the year ending December 31, 1997: Votes For: 24,342,803 Votes Against: 39,832 Abstentions: 11,215 Broker Non-Votes: -0- (d) Not applicable. Item 6 - Exhibits and Reports on Form 8-K (a) Exhibits. The following exhibits are filed herewith: --------- Number Description ------ ----------- 11 Statement regarding computation of earnings per share. 27 Financial Data Schedule (pursuant to Item 601(c)(1)(iv) of Regulation S-K, this exhibit shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended) (b) Reports on Form 8-K ------------------- No reports on Form 8-K were filed by the Company during the quarter ended June 30, 1997. 15 Signatures - ---------- Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. DENTSPLY INTERNATIONAL INC. August 14, 1997 /s/ John C. Miles II - -------------------- ----------------------------------- Date John C. Miles II Vice Chairman and Chief Executive Officer August 14, 1997 /s/ Edward D. Yates - -------------------- ----------------------------------- Date Edward D. Yates Senior Vice President and Chief Financial Officer 16 EXHIBIT INDEX ------------- Number Description Sequential Page No. ------ ----------- ------------------- 11 Statement regarding computation 18 of earnings per share. 27 Financial Data Schedule 19 (pursuant to Item 601(c)(1)(iv) of Regulation S-K, this exhibit shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended) 17 EX-11 2 EX-11 DENTSPLY INTERNATIONAL INC. EXHIBIT 11 COMPUTATION OF EARNINGS PER COMMON SHARE Earnings per common share: - -------------------------- Three Months Ended Six Months Ended June 30, June 30, ------------------ ------------------- 1997 1996 1997 1996 -------- -------- -------- -------- (in thousands, except per share data) Weighted average common shares outstanding 26,945 26,958 26,934 26,955 Net income $17,843 $17,770 $34,767 $32,757 Earnings per common share $.66 $.66 $1.29 $1.22 18 EX-27 3 FDS --
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS OF DENTSPLY INTERNATIONAL INC. AT JUNE 30, 1997 AND FOR THE FISCAL QUARTER THEN ENDED, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1000 6-MOS DEC-31-1997 JAN-01-1997 JUN-30-1997 7791 0 107258 0 117574 266833 203416 60998 740050 149186 121899 0 0 271 389475 740050 350666 350666 171845 171845 118247 0 6217 57153 22386 34767 0 0 0 34767 1.29 1.29
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