-----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, SS6fKZYkWk0kwSxgr/4CP42zv2zhTv1UZHNxBugQ9d+LZqLYnkZG0BP0B7aVX9hC XznSxg5FeC0L1WPI4MKkQw== 0000950131-96-005504.txt : 19961106 0000950131-96-005504.hdr.sgml : 19961106 ACCESSION NUMBER: 0000950131-96-005504 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19960930 FILED AS OF DATE: 19961105 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: RIVAL CO CENTRAL INDEX KEY: 0000860194 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC HOUSEWARES & FANS [3634] IRS NUMBER: 133327021 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-20274 FILM NUMBER: 96654401 BUSINESS ADDRESS: STREET 1: 800 E 101ST TERRACE CITY: KANSAS CITY STATE: MO ZIP: 64131 BUSINESS PHONE: 8169434100 MAIL ADDRESS: STREET 1: 800 E 101ST TERRACE CITY: KANSAS CITY STATE: MO ZIP: 64131 10-Q 1 FORM 10-Q 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, 1996. 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 0-20274 ------- THE RIVAL COMPANY - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 43-0794462 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 800 E. 101st Terrace, Kansas City, MO 64131 - ---------------------------------------------- --------------------------- (Address of principal executive offices) (Zip Code) (816) 943-4100 - -------------------------------------------------------------------------------- (Registrant's telephone number, including area code) 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. (l) Yes X No ----- ----- (2) Yes X No ----- ----- Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practical date. As of September 30, 1996, the registrant had 9,732,792 shares of common stock, par value $.01 per share, outstanding. THE RIVAL COMPANY FORM 10-Q QUARTER ENDED SEPTEMBER 30, 1996 INDEX PART I. - FINANCIAL INFORMATION Page ITEM 1. Financial Statements (1) Condensed Consolidated Financial Statements (unaudited): Condensed Consolidated Balance Sheets as of September 30, 1996, September 30, 1995 and June 30, 1996. 3 Condensed Consolidated Statements of Earnings for the three months ended September 30, 1996 and September 30, 1995. 4 Condensed Consolidated Statements of Cash Flows for the three months ended September 30, 1996 and September 30, 1995. 5 (2) Notes to Condensed Consolidated Financial Statements. 6 ITEM 2. - Management's Discussion and Analysis of Financial Condition and Results of Operations. 6 PART II. - OTHER INFORMATION ITEM 6. Exhibits and Reports on Form 8-K 7 2 PART I - FINANCIAL INFORMATION THE RIVAL COMPANY AND SUBSIDIARIES ----------------------- CONDENSED CONSOLIDATED BALANCE SHEETS September 30, 1996 and 1995 and June 30, 1996 (amounts in thousands) (unaudited)
9/30/96 9/30/95 6/30/96 ------- ------- ------- ASSETS Currents assets: Cash $ 195 $ 432 $ 1,503 Accounts receivable 90,583 64,226 74,103 Inventories 116,385 84,498 102,030 Deferred income taxes 1,602 860 1,602 Prepaid expenses 3,149 1,105 2,142 -------- -------- -------- Total current assets 211,914 151,121 181,380 Property, plant and equipment, net 41,823 27,525 40,345 Goodwill 59,562 47,780 60,086 Other assets 6,074 2,859 6,440 -------- -------- -------- $319,373 $229,285 $288,251 ======== ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Notes payable to banks $ 69,306 $ 51,327 $ 51,896 Current portion of long-term debt 4,000 4,000 4,000 Trade accounts payable 25,172 17,305 20,354 Income taxes payable 3,592 3,795 197 Other payables and accrued expenses 14,226 10,031 13,537 -------- -------- -------- Total current liabilities 116,296 86,458 89,984 Long-term debt, less current portion 88,000 42,000 88,000 Deferred income taxes and other liabilities 4,232 2,372 4,119 Stockholders' equity: Common stock 98 97 97 Paid-in capital 45,519 45,368 45,488 Retained earnings 66,032 53,654 61,341 Treasury stock, at cost (310) (310) (310) Foreign currency translation adjustments (494) (354) (468) -------- -------- -------- Total stockholders' equity 110,845 98,455 106,148 -------- -------- -------- $319,373 $229,285 $288,251 ======== ======== ========
See accompanying notes to condensed consolidated financial statements. 3 THE RIVAL COMPANY AND SUBSIDIARIES ----------------------- CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS Three months ended September 30, 1996 and September 30, 1995 (amounts in thousands, except per share amounts) (unaudited)
Three months ended ------------------ 9/30/96 9/30/95 ------- ------- Net sales $99,650 $73,897 Cost of sales 71,067 52,481 ------- ------- Gross profit 28,583 21,416 Selling expenses 13,309 8,586 General and Administrative expenses 3,523 2,598 Amortization of goodwill 523 406 ------- ------- Operating income 11,228 9,826 Interest expense (2,491) (1,476) Other expense, net 18 (11) ------- ------- Earnings before income taxes 8,755 8,339 Income tax expense 3,479 3,246 ------- ------- Net earnings $ 5,276 $ 5,093 ======= ======= Weighted average common and common equivalent shares outstanding 9,948 9,921 ======= ======= Net earnings per common share $ 0.53 $ 0.51 ======= =======
See accompanying notes to condensed consolidated financial statements. 4 THE RIVAL COMPANY AND SUBSIDIARIES ----------------------- CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS Three months ended September 30, 1996 and September 30, 1995 (amounts in thousands) (unaudited)
Three months ended ------------------ 9/30/96 9/30/95 -------- -------- Cash flows from operating activities: Net earnings $ 5,276 $ 5,093 Adjustments to reconcile net earnings to net cash used by operating activities: Depreciation and amortization 2,465 1,693 Other 113 -- Changes in assets and liabilities: Accounts receivable (16,480) (20,734) Inventories (14,355) (3,394) Prepaid expenses (1,007) (270) Accounts payable and accruals 5,507 3,349 Income taxes payable 3,395 3,218 -------- -------- Net cash used by operating activities (15,086) (11,045) -------- -------- Cash flows from investing activities: Capital expenditures (3,167) (1,600) Other 88 (312) -------- -------- Net cash used by investing activities (3,079) (1,912) -------- -------- Cash flows from financing activities: Net borrowings under working capital loans 17,410 13,700 Dividends paid (585) (486) Other 32 (18) -------- ------- Net cash provided by financing activities 16,857 13,196 -------- ------- Net increase (decrease) in cash (1,308) 239 Cash at beginning of period 1,503 193 -------- ------- Cash at end of period $ 195 $ 432 ======== =======
See accompanying notes to condensed consolidated financial statements. 5 THE RIVAL COMPANY AND SUBSIDIARIES ----------------------- Notes to Condensed Consolidated Financial Statements Three Months Ended September 30, 1996 and September 30, 1995 Note 1 - ------ In the opinion of Management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (consisting of normal recurring accruals) considered necessary to present fairly the financial position of the Company as of September 30, 1996, and the results of its operations and its cash flows for the three months ended September 30, 1996 and September 30, 1995. The June 30, 1996, condensed consolidated balance sheet has been derived from the audited consolidated financial statements as of that date. These financial statements have been prepared in accordance with the instructions to Form 10-Q. To the extent that information and footnotes required by generally accepted accounting principles for complete financial statements are contained in or consistent with the audited consolidated financial statements incorporated by reference in the Company's Form 10-K for the year ended June 30, 1996, such information and footnotes have not been duplicated herein. Note 2 - ------ The results of operations for the three months ended September 30, are not indicative of the results to be expected for the full year due to the seasonal nature of the Company's operations. Note 3 Inventories - ------------------ The following is a summary of inventories at September 30, 1996 and 1995 and June 30, 1996 (in thousands):
Sept. 30, 1996 Sept. 30, 1995 June 30, 1996 -------------- -------------- ------------- Raw Materials $ 41,214 $31,318 $ 37,442 Work in progress 4,580 3,401 5,028 Finished goods 75,360 54,086 64,103 -------- ------- -------- 121,154 88,805 106,573 Less LIFO allowance (4,769) (4,307) (4,543) -------- ------- -------- $116,385 $84,498 $102,030 ======== ======= ========
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS Net sales were $99.7 million for the quarter ended September 30, 1996 compared to $73.9 million in the prior year. The higher sales were primarily the result of the acquisitions of Fasco Consumer Products, Inc. in January 1996 and Bionaire, Inc. in April 1996. The Company generated internal growth of 11% from its kitchen electrics and personal care products due to strong sales of Crock Pot(R) slow cookers and specialty massagers. Sales increases in other business units resulted primarily from the acquisitions. 6 Net sales by business unit were as follows (in millions):
9/30/96 9/30/95 ------- ------- Kitchen Electrics & Personal Care $49.8 $44.7 Home Environment 33.1 21.3 Industrial/Building Supply 9.7 5.3 International 7.1 2.6 ----- ----- $99.7 $73.9
Gross profit was $28.6 million (28.7% of sales) for the quarter ended September 30, 1996 compared to $21.4 million (29.0% of sales) in the prior year. The decline in margins as a percentage of sales was the result of excess plant capacity. During the quarter, plans to discontinue manufacturing in the Peru, Indiana plant and curtail production at the Sweet Springs, Missouri plant were announced. Neither action will result in a significant charge to earnings. Selling expenses were $13.3 million (13.4% of sales) for the current quarter compared to $8.6 million (11.6% of sales) in the prior year. The industrial and international business units had incremental sales due to the Bionaire and Fasco acquisitions and these businesses have higher selling costs than the Company's other business units. Additionally, shipping expenses have increased as a percentage of sales due to rental of outside warehouses to support growth and increased special handling demands of the Company's retail customers. General and administrative expenses were $3.5 million (3.5% of sales) in the current quarter compared to $2.6 million (3.5% of sales) in the prior year. The increase in general and administrative expenses includes a $.4 million increase in research and development spending, $.3 million in other G&A costs relative to Bionaire's Canadian operation and increased personnel to support the growth of the Company's domestic operations. Interest expense increased from $1.5 million to $2.5 million, primarily as a result of increased borrowings to finance recent acquisitions. Average interest rates were also slightly higher. Net earnings for the quarter ended September 30, 1996 were $5.3 million ($.53 per share) compared to $5.1 million ($.51 per share) for the same period in the prior year. LIQUIDITY AND CAPITAL RESOURCES As of September 30, 1996 the Company had $92 million in long term debt (including $4 million current portion) and $85 million in revolving loan commitments. Revolving credit loans outstanding were $69.3 million as of such date. The long term debt requires periodic principal payments including $4.0 million for each of the next two years and has a final maturity in 2008. The revolving credit facilities include a $75 million U.S. bank line and a Canadian facility for the Canadian dollar equivalent of U.S. $10.0 million. The U.S. revolving credit facility expires in June 1999 and currently bears interest at a floating rate of LIBOR plus .75%. During the three months ended September 30, 1996, the Company used $15.1 million of cash for operating activities. The Company historically requires a significant amount of cash each fall to fund its build-up in inventories and accounts receivable during its peak selling season. These cash requirements are funded through borrowings on the working capital line. The Company plans to make capital expenditures of approximately $10.0 million during fiscal 1997, including $4 million for a new distribution center. Management believes that cash generated from operations and its bank credit facility will be sufficient to meet its cash requirements for the foreseeable future. 7 PART II - OTHER INFORMATION --------------------------- Item 6. Exhibits and Reports on Form 8-K -------------------------------- (a) Exhibits. 11 Schedule regarding computation of per share earnings. (b) Reports on Form 8-K. None 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. THE RIVAL COMPANY By: -------------------------------- Dated: October 31, 1996 William L. Yager President, Chief Operating Officer (Duly Authorized Officer) 8 EX-11 2 SCHEDULE RE: COMPUTATION OF PER SHARE EARNINGS THE RIVAL COMPANY AND SUBSIDIARIES EXHIBIT 11 EARNINGS PER SHARE (in thousands except per share data)
Three Months ended September 30,* -------------- 1996 1995 ------ ------ Net earnings $5,276 $5,093 ====== ====== Weighted average common and common equivalent shares outstanding 9,948 9,921 ====== ====== Earnings per common and common equivalent shares $ 0.53 $ 0.51 ====== ====== Computation of weighted average common and common equivalent shares outstanding: Average common shares outstanding 9,730 9,717 Average number of options outstanding 684 538 Less treasury shares acquired with proceeds from exercise of options (446) (334) ------ ------ Weighted average common and common equivalent shares outstanding 9,948 9,921 ====== ======
* Fully diluted earnings per share is equal to primary earnings per share for both periods presented. EX-27 3 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10 FOR THE RIVAL COMPANY AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 3-MOS 3-MOS JUN-30-1997 JUN-30-1996 JUL-01-1996 JUL-01-1995 SEP-30-1996 SEP-30-1995 195 432 0 0 93,751 66,395 3,168 2,169 116,385 84,498 211,914 151,121 73,222 50,253 31,399 22,728 319,373 229,285 116,296 86,458 88,000 42,000 98 97 0 0 0 0 110,747 98,358 319,373 229,285 99,650 73,897 99,650 73,897 71,067 52,481 71,067 52,481 17,355 11,590 208 113 2,491 1,476 8,755 8,339 3,479 3,246 5,276 5,093 0 0 0 0 0 0 5,276 5,093 0.53 0.51 0.53 0.51
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