-----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, H/Pq2iltkH4SD4bt0M91KWDv6Qx92ADtiBrIzByS9VxD4tb14rBrkTgu3dwCgt5E Vy9z+g755QfkeLdcF/vUrw== 0000086082-95-000010.txt : 19951119 0000086082-95-000010.hdr.sgml : 19951119 ACCESSION NUMBER: 0000086082-95-000010 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951114 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: SADLIER WILLIAM H INC CENTRAL INDEX KEY: 0000086082 STANDARD INDUSTRIAL CLASSIFICATION: BOOKS: PUBLISHING OR PUBLISHING AND PRINTING [2731] IRS NUMBER: 135363840 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-03037 FILM NUMBER: 95591052 BUSINESS ADDRESS: STREET 1: 9 PINE ST CITY: NEW YORK STATE: NY ZIP: 10005-1002 BUSINESS PHONE: 2122272120 MAIL ADDRESS: STREET 2: 9 PINE ST CITY: NEW YORK STATE: NY ZIP: 10005-1002 10-Q 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 ___________ Commission file number _________ 0-3037 _____________ _________________________ WILLIAM H. SADLIER, INC. ______________________ (Exact name of registrant as specified in its charter) _____________ New York __________ ________ 13-5363840 __________ (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) __ 9 Pine Street, New York, New York ______________ 10005-1002 __________ (Address of principal executive office) (Zip Code) Registrant's telephone number, including area code ___ (212) 227-2120 ___ _______________________________ 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 ________ Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of October 31, 1995. Common stock, par value $0.25 per share: 894,296 shares outstanding. PART I. FINANCIAL INFORMATION Item 1. Financial Statements
WILLIAM H. SADLIER, INC. AND SUBSIDIARY CONDENSED CONSOLIDATED BALANCE SHEETS _____ September 30, ______ December 31, ___ 1995 ___ ___ 1994 ___ ___ 1994 ___ (Unaudited) (Note) ASSETS: Cash and cash equivalents $ 1,905,960 $ 1,561,123 $ 871,515 Accounts receivable 9,698,288 8,922,939 2,185,333 Inventories: Bound books and merchandise 2,170,673 1,403,074 1,652,782 Sheet stock and work in process 10,560 85,410 55,657 Paper ____175,232 _____51,648_ _____79,895_ 2,356,465 1,540,132 1,788,334 Prepaid expenses 376,971 433,120 333,035 Deferred income taxes ____645,200_ ____650,200_ ____645,200_ Total current assets 14,982,884 13,107,514 5,823,417 Fixed assets--net 1,049,447 1,204,101 1,163,009 Deferred pre-publication costs 6,833,395 6,500,952 6,801,832 Other assets ____762,414_ ____639,954_ ____751,927_ $23,628,140 $21,452,521 $14,540,185 ============ ============ ============ LIABILITIES AND SHAREHOLDERS' EQUITY: Current portion of long-term debt $ 100,000 $ - $ 100,000 Notes payable--banks 5,800,000 5,300,000 - Accounts payable 816,663 957,908 986,436 Accrued royalties 1,144,987 981,954 1,082,481 Other liabilities and accrued expenses __2,606,514_ __2,057,689_ ____868,837_ Total current liabilities 10,468,164 9,297,551 3,037,754 Long-term debt 225,000 - 300,000 Deferred income taxes 41,800 32,900 41,800 Shareholders' equity: Common shares 225,000 225,000 225,000 Retained earnings _12,699,909_ _11,928,803_ _10,967,364_ 12,924,909 12,153,803 11,192,364 Less treasury shares, at cost ____(31,733) ____(31,733) ____(31,733) _12,893,176_ _12,122,070_ _11,160,631_ $23,628,140 $21,452,521 $14,540,185 ============ ============ ============ Note: The balance sheet at December 31, 1994 has been taken from the audited financial statements at that date and condensed.
WILLIAM H. SADLIER, INC. AND SUBSIDIARY CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND RETAINED EARNINGS (Unaudited) Nine months ended Three months ended September 30, September 30, ____1995____ ____1994____ ____1995____ ____1994____ Net sales $20,882,112 $19,041,467 $13,899,951 $13,041,111 Operating costs and expenses: Manufacturing, royalty and amortization 6,873,704 5,755,331 3,962,515 3,348,578 Editorial and distribution 2,675,031 3,263,935 669,252 963,389 Selling, general and administrative __7,737,623_ __7,749,268_ __2,569,457_ __2,443,073 _17,286,358_ _16,768,534_ __7,201,224_ __6,755,040_ Operating income 3,595,754 2,272,933 6,698,727 6,286,071 Other income (expense): Interest income 685 9,181 163 478 Other income 21,169 13,020 880 7,996 Interest expense ___(421,633) ___(256,862) ___(219,201) ___(155,614) ___(399,779) ___(234,661) ___(218,158) ___(147,140) Income before income taxes 3,195,975 2,038,272 6,480,569 6,138,931 Provision for income taxes __1,374,000_ ____876,000_ __2,786,000_ __2,639,000_ Net income 1,821,975 1,162,272 3,694,569 3,499,931 Retained earnings at beginning of period 10,967,364 10,945,390 9,094,770 8,607,731 Cash dividends, $.10 and $.20 per share in 1995 and 1994, repectively ____(89,430) ___(178,859) ____(89,430) ___(178,859) Retained earnings at end of period $12,699,909 $11,928,803 $12,699,909 $11,928,803 ============ ============ ============ ============ Income per common share $ 2.04 $ 1.30 $ 4.13 $ 3.91 ============ ============ ============ ============ Average common shares outstanding 894,296 895,796 894,296 894,296 ============ ============ ============ ============
WILLIAM H. SADLIER, INC. AND SUBSIDIARY CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Nine months ended September 30, _____1995____ _____1994____ CASH FLOW USED IN OPERATIONS: Cash used in operations $ (2,698,335) $ (3,107,764) CASH FLOW USED IN INVESTING ACTIVITIES: Proceeds from sale of short-term investments - 695,880 Capital expenditures (41,227) (140,752) Prepublication cost expenditures (1,861,563) (3,010,738) Purchase of textbook series ________-____ ____(360,000) Cash used in investing activities __(1,902,790) __(2,815,610) CASH FLOW FROM FINANCING ACTIVITIES: Net borrowings under lines of credit 5,800,000 5,300,000 Dividends paid (89,430) (178,859) Repayment of long-term debt (75,000) - Purchase of treasury shares ________-____ _____(25,000) Cash provided by financing activities ___5,635,570_ ___5,096,141_ Increase (decrease) in cash and cash equivalents 1,034,445 (827,233) Cash and cash equivalents at beginning of period _____871,515_ ___2,388,356_ Cash and cash equivalents at end of period $ 1,905,960 $ 1,561,123 ============= ============= OTHER CASH FLOW INFORMATION: Depreciation and amortization $ 2,003,384 $ 1,830,226 ============= ============
WILLIAM H. SADLIER, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. Condensed Consolidated Financial Statements The condensed consolidated balance sheets as of September 30, 1995 and 1994, and both the condensed consolidated statements of operations and retained earnings and the condensed consolidated statements of cash flows for the nine- month and three-month periods then ended have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and changes in cash flows for all periods presented have been made. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these condensed consolidated financial statements be read in conjunction with the financial statements and related notes included in the Company's Annual Report for the year ended December 31, 1994. 2. Seasonality Historically, educational publishing has been subject to the seasonality associated with the educational year, resulting in a concentration of sales in the third calendar quarter. Therefore, the results of operations for the nine months ended September 30, 1995 should not necessarily be considered indicative of the results for the year ending December 31, 1995. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations In the nine months ended September 30, 1995, net sales rose by 10% over the comparable period in 1994. The Catholic School and Parish Editions of Coming to Faith, and New Progress in Mathematics and Vocabulary Workshop all continued to exhibit strong sales growth. Their increases more than offset the sales generated by the Catechism of the Catholic Church in 1994. Increased paper prices resulted in higher manufacturing costs in 1995. During the third quarter of 1995, the Company increased the prices of most of its products and expects to recover most of these higher costs. Editorial expenses continued to be lower in 1995 due to the completion of the revisions of several major series. Selling and promotional expenses directly affected by the higher sales level increased in the three months ended September 30, 1995. General and administrative expenses also rose slightly in that period. Interest expense increased in 1995 due to higher levels of borrowing and higher interest rates, while interest income decreased because of a reduction in funds available for investment. Cash discounts related to increased paper purchases in 1995 accounted for most of the change in "other income." The credits and provision for income taxes in 1995 and 1994 were based on the effective tax rates estimated for each full year. Liquidity and Capital Resourses Cash and cash equivalents and working capital at September 30, 1995 increased by $345,000 and $705,000, respectively, from the comparable date in 1994, primarily due to reduced prepublication cost and editorial expenditures in 1995. Because of the reduced availability of paper in 1995, the Company purchased more paper for inventory than it normally does to ensure an adequate supply for its printing requirements. Inventory levels also reflected the increased printing requirements of the newly revised series. Cash flow provided by operations has generally been sufficient to finance investment in new products, equipment and facilities, dividends paid to shareholders and the repayment of short-term bank borrowing. Management believes this will continue to be true in 1995. In July of 1995, the Company increased its lines of credit with its banks, from $9,000,000 to $10,500,000. Each year, because of the seasonality associated with educational publishing, the Company must draw on its lines of credit. During the latter part of each year, such borrowing is repaid and excess funds are available for investment in cash equivalents and short-term securities. At September 30, 1995 and 1994, such short-term borrowing amounted to $5,800,000 and $5,300,000, respectively. The Company's peak borrowing was $10,000,000 in 1995 and $8,600,000 in 1994. PART II. OTHER INFORMATION All items required hereunder have been omitted because they are inapplicable or would result in negative answers. 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. _____WILLIAM H. SADLIER, INC.____ (Registrant) __November 6, 1995__ By: ___/s/ Frank S. Dinger____ (Date) Frank S. Dinger Chairman of the Board and Chief Operating Officer __November 6, 1995__ By: ___/s/ Henry E. Christel__ (Date) Henry E. Christel Vice President, Treasurer Principal Financial Officer EX-27 2
5 This shedule contains financial information extracted from the Condensed Consolidated Balance Sheets and Condensed Consolidated Statements of Operations and Retained Earnings in accordance with Article 5 of Regulation S-X. 9-MOS 3-MOS DEC-31-1995 DEC-31-1995 SEP-30-1995 SEP-30-1995 1,905,960 1,905,960 0 0 10,269,980 10,269,980 571,692 571,692 2,356,465 2,356,465 14,982,884 14,982,884 1,978,962 1,978,962 929,515 929,515 23,628,140 23,628,140 10,468,164 10,468,164 0 0 225,000 225,000 0 0 0 0 12,668,176 12,668,176 23,628,140 23,628,140 0 0 20,882,112 13,899,951 6,873,704 3,962,515 17,286,358 7,201,224 0 0 0 0 421,633 219,201 3,195,975 6,480,569 1,374,000 2,786,000 1,821,975 3,694,569 0 0 0 0 0 0 1,821,975 3,694,569 2.04 4.13 2.04 4.13
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