-----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, Ba64YxhkO5fJQ4Nb2z3djxIz/WC6GgAsXIdVVgwfumTClYMpCvFpviNTRqabocyY f66vrcGi/tkrmMo3uCMgyg== 0000088948-95-000011.txt : 19951119 0000088948-95-000011.hdr.sgml : 19951119 ACCESSION NUMBER: 0000088948-95-000011 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951114 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: SENECA FOODS CORP /NY/ CENTRAL INDEX KEY: 0000088948 STANDARD INDUSTRIAL CLASSIFICATION: CANNED, FRUITS, VEG & PRESERVES, JAMS & JELLIES [2033] IRS NUMBER: 160733425 STATE OF INCORPORATION: NY FISCAL YEAR END: 0731 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-01989 FILM NUMBER: 95591881 BUSINESS ADDRESS: STREET 1: 1162 PITTSFORD VICTOR RD CITY: PITTSFORD STATE: NY ZIP: 14534 BUSINESS PHONE: 7163859500 FORMER COMPANY: FORMER CONFORMED NAME: PIERCE S S COMPANY INC DATE OF NAME CHANGE: 19861210 FORMER COMPANY: FORMER CONFORMED NAME: SENECA FOODS CORP DATE OF NAME CHANGE: 19780425 FORMER COMPANY: FORMER CONFORMED NAME: SENECA GRAPE JUICE CORP DATE OF NAME CHANGE: 19710419 10-Q 1 Form 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 QUARTERLY REPORT UNDER SECTION 13 OF 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarter Ended September 30, 1995 Commission File Number 0-1989 Seneca Foods Corporation (Exact name of registrant as specified in its charter) New York 16-0733425 (State or other jurisdiction of (I. R. S. Employer incorporation or organization) Identification No.) 1162 Pittsford-Victor Road, Pittsford, New York 14534 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code 716/385-9500 Not Applicable Former name, former address and former fiscal year, if changed since last report Check mark indicates whether registrant (1) has filed all reports required to be filed by Section 13 of 15(d) of the Securities 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 The number of shares outstanding of each of the issuer's classes of common stock at the latest practical date are: Class Shares Outstanding at October 31, 1995 Common Stock Class A, $.125 Par 2,796,555 Common Stock Class B, $.125 Par 2,796,555 PART I FINANCIAL INFORMATION SENECA FOODS CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS (In Thousands of Dollars)
9/30/95 3/31/95 _______ _______ ASSETS Current Assets: Cash and Short-term Investments $ 10,740 $ 26,538 Accounts Receivable, Net 41,065 32,601 Inventories: Finished Goods 281,325 64,613 Work in Process 17,605 19,531 Raw Materials 37,729 48,260 ------- ------- 336,659 132,404 Off-Season Reserve (Note 3) (36,631) - Deferred Tax (Net) 1,933 1,933 Other Current Assets 7,497 801 -------------- --------------- Total Current Assets 361,263 194,277 Property, Plant and Equipment, Net 228,734 179,718 Common Stock of Moog Inc. 10,857 7,494 Other Assets 348 237 -------------- --------------- $ 601,202 $ 381,726 ============== =============== LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Notes Payable $ 109,100 $ - Accounts Payable 145,791 36,089 Accrued Expenses 18,446 19,599 Income Taxes - 125 Current Portion of Long-Term Debt and Capital Lease Obligations 1,305 5,594 --------------- --------------- Total Current Liabilities 274,642 61,407 Long-Term Debt 225,024 220,677 Capital Lease Obligations 9,677 803 Deferred Income Taxes 12,698 11,490 10% Preferred Stock, Series A, Voting, Cumulative, Convertible, $.025 Par Value Per Share 10 10 10% Preferred Stock, Series B, Voting, Cumulative, Convertible, $.025 Par Value Per Share 10 10 6% Preferred Stock, Voting, Cumulative, $.25 Par Value Per Share 50 50 Common Stock 1,880 1,880 Net Unrealized Gain on Available-For-Sale Securities 3,010 892 Retained Earnings 74,201 84,507 --------------- --------------- Stockholders' Equity 79,161 87,349 --------------- --------------- $601,202 $ 381,726 =============== =============== The accompanying notes are an integral part of these financial statements.
SENECA FOODS CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Unaudited) (In Thousands, except Share Data)
Three Months Ended __________________ 9/30/95 9/24/94 _______ _______ Net Sales $ 131,979 $ 72,325 Costs and Expenses: Cost of Product Sold 118,324 63,904 Selling, General, and Administrative 8,185 6,503 Interest Expense 6,820 1,373 Nonrecurring Charge (See Notes) 15,078 - ------------------ ----------------- Total Costs and Expenses 148,407 71,780 ------------------ ----------------- Earnings Before Income Taxes (16,428) 545 Income Taxes (6,079) (66) ------------------ ----------------- Earnings (loss) from Continuing Operations (10,349) 611 Earnings from Discontinued Operations - 5 Gain on the Sale of Discontinued Operations Net of Income Taxes - 138 Extraordinary Losses Net of Income Taxes - (606) ------------------ ----------------- Net Earnings (Loss) $ (10,349) $ 148 ================== ================= Net Earnings from Continuing Operations Applicable to Common Stock $ (10,355) $ 605 Net Earnings Applicable to Common Stock (10,355) 142 Weighted Average Common Shares Outstanding 5,593,110 5,593,110 Primary and Fully Diluted Earnings Per Share of Common Stock (Exhibit II): Earnings from Continuing Operations $ (1.85) $ .11 Earnings from Discontinued Operations - .00 Gain on the Sales of Discontinued Operations - .03 Extraordinary Loss - (.11) ------------------ --------------- Net Earnings (Loss) $ (1.85) $ .03 ================== =============== The accompanying notes are an integral part of these condensed financial statements.
SENECA FOODS CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Unaudited) (In Thousands, except Share Data)
Six Months Ended ________________ 9/30/95 9/24/94 _______ _______ Net Sales $ 213,924 $ 143,086 Costs and Expenses: Cost of Product Sold 186,853 123,872 Selling, General, and Administrative 15,968 13,709 Interest Expense 12,365 2,729 Nonrecurring Charge (See Notes) 15,078 - ------------------ ----------------- Total Costs and Expenses 230,264 140,310 ------------------ ----------------- Earnings Before Income Taxes (16,340) 2,776 Income Taxes (6,046) 739 ------------------ ----------------- Earnings (loss) from Continuing Operations (10,294) 2,037 Earnings from Discontinued Operations - 6 Gain on the Sale of Discontinued Operations Net of Income Taxes - 172 Extraordinary Losses Net of Income Taxes - (606) ------------------ ----------------- Net Earnings (Loss) $ (10,294) $ 1,609 ================== ================= Net Earnings from Continuing Operations Applicable to Common Stock $ (10,306) $ 2,025 Net Earnings Applicable to Common Stock (10,306) 1,597 Weighted Average Common Shares Outstanding 5,593,110 5,593,860 Primary and Fully Diluted Earnings Per Share of Common Stock (Exhibit II): Earnings from Continuing Operations $ (1.84) $ .37 Earnings from Discontinued Operations - .00 Gain on the Sales of Discontinued Operations - .03 Extraordinary Loss - (.11) ------------------ --------------- Net Earnings (Loss) $ (1.84) $ .29 ================== =============== The accompanying notes are an integral part of these condensed financial statements.
SENECA FOODS CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) (In Thousands)
Three Months Ended __________________ 9/30/95 9/24/94 _______ _______ Cash Flows From Operating Activities: Net Earnings $ (10,349) $ 148 Adjustments to Reconcile Net Earnings to Net Cash Provided by Operating Activities: Depreciation and Amortization 5,862 2,623 Deferred Income Taxes (13) (134) Changes in Working Capital: Accounts Receivable (10,621) (11,495) Inventories (98,374) (64,150) Off-Season Reserve (18,715) 13,957 Other Current Assets (195) 2,426 Income Taxes (6,711) (2,345) Accounts Payable and Accrued Expenses 99,853 26,762 ------------------ ----------------- Net Cash Used in Operations (39,263) (32,208) ------------------ ----------------- Cash Flows From Investing Activities: Additions to Property, Plant, and Equipment (22,617) (2,008) Acquisition - (3,769) Disposals of Property, Plant, and Equipment 33 859 ------------------ ----------------- Net Cash Used in Investing Activities (22,584) (4,918) ------------------ ----------------- Cash Flows From Financing Activities: Notes Payable 61,100 27,900 Long-Term Borrowing 9,258 - Payments and Current Portion of Long-Term Debt and Capital Lease Obligations (15) (16,679) Other (87) 3 Dividends - - Common Stock Retirement - (2) ------------------ ------------------ Net Cash Provided by Financing Activities 70,256 11,222 ------------------ ----------------- Net Increase (Decrease) in Cash and Short- Term Investments 8,409 (25,904) Cash and Short-Term Investments, Beginning of Period 2,331 27,402 ------------------ ----------------- Cash and Short-Term Investments, End of Period $ 10,740 $ 1,498 ================== ================== The accompanying notes are an integral part of these condensed financial statements.
SENECA FOODS CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) (In Thousands)
Six Months Ended ________________ 9/30/95 9/24/94 _______ _______ Cash Flows From Operating Activities: Net Earnings $ (10,294) $ 1,609 Adjustments to Reconcile Net Earnings to Net Cash Provided by Operating Activities: Depreciation and Amortization 10,358 4,956 Deferred Income Taxes (35) 1,424 Changes in Working Capital: Accounts Receivable (8,464) (4,590) Inventories (130,993) (56,034) Off-Season Reserve (36,631) 7,705 Other Current Assets 43 (736) Income Taxes (6,864) (4,165) Accounts Payable and Accrued Expenses 108,549 27,234 ------------------ ----------------- Net Cash Used in Operations (74,331) (22,597) ------------------ ----------------- Cash Flows From Investing Activities: Additions to Property, Plant, and Equipment (59,409) (3,646) Acquisition - (3,769) Disposals of Property, Plant, and Equipment 33 859 ------------------ ----------------- Net Cash Used in Investing Activities (59,376) (6,556) ------------------ ----------------- Cash Flows From Financing Activities: Notes Payable 109,100 27,900 Long-Term Borrowing 9,258 - Payments and Current Portion of Long-Term Debt and Capital Lease Obligations (326) (17,561) Other (111) 6 Dividends (12) (12) Common Stock Retirement - (1,880) ------------------ ------------------ Net Cash Provided by Financing Activities 117,909 8,453 ------------------ ----------------- Net Decrease in Cash and Short- Term Investments (15,798) (20,700) Cash and Short-Term Investments, Beginning of Period 26,538 22,198 ------------------ ----------------- Cash and Short-Term Investments, End of Period $ 10,740 $ 1,498 ================== ================== The accompanying notes are an integral part of these condensed financial statements.
SENECA FOODS CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS September 30, 1995 1. Consolidated Condensed Financial Statements In the opinion of management, the accompanying unaudited consolidated condensed financial statements contain all adjustments, which are normal and recurring in nature, necessary to present fairly the financial position of the Registrant as of September 30, 1995 and March 31, 1995 and results of operations for the three and six month periods ended September 30, 1995 and September 24, 1994. All significant intercompany transactions and accounts have been eliminated in consolidation. The March 31, 1995 balance sheet was derived from audited financial statements. The results of operations for the three month periods ended September 30, 1995 and September 24, 1994 are not necessarily indicative of the results to be expected for the full year. The accounting policies followed by the Registrant are set forth in Note 1 to the Registrant's financial statements in the 1995 Seneca Foods Corporation Annual Report and 10-K. Other 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 consolidated condensed financial statements be read in conjunction with the financial statements and notes included in the Registrant's March 31, 1995 financial report. 2. Primary earnings per share are based on the weighted average number of common shares outstanding, as the effect of common stock equivalents is immaterial. The difference between primary and fully diluted earnings per share is immaterial. 3. Off-Season Reserve is the excess of absorbed expenses over incurred expenses to date. The seasonal nature of the Registrant's Food Processing business results in a timing difference between expenses (primarily overhead expenses) incurred and absorbed into product cost. All Off-Season Reserve balances are zero at fiscal year end. 4. The Registrant changed its fiscal year end from July 31 to March 31 during Fiscal 1995. These financial statements reflect the prior year as if the fiscal year ended March 31. SENECA FOODS CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Continued) September 30, 1995 5. A proposed amendment to the Registrant's Certificate of Incorporation which effected a recapitalization of the Registrant by creating a second class of Common Stock (which is being distributed to all common shareholders in the form of a stock dividend) was adopted at the Annual Meeting held on August 5, 1995. This recapitalization amendment (i) reclassifies the existing Common Stock as Class B Common Stock, (ii) authorizes a new class of 10,000,000 shares designated as Class A Common Stock and (iii) establishes the express terms of the Class A Common Stock and the Class B Common Stock. The Class A Common Stock and the Class B Common Stock have substantially identical rights with respect to any dividends or distributions of cash or property declared on shares of common stock and rank equally as to the right to receive proceeds on liquidation or dissolution of the Registrant after payment of the Registrant's indebtedness and liquidation right to the holders of preferred shares. However, holders of Class B Common Stock retain full vote per share whereas the holders of Class A Common Stock have voting rights of 1/20th of one vote per share on all matters as to which shareholders of the Registrant are entitled to vote. 6. The second quarter results include a nonrecurring charge of $15,078,000, before income tax benefit, due to combination of start-up costs related to the Pillsbury Alliance and severe drought conditions that New York State suffered during the entire summer. The Registrant undertook an ambitious capital expenditure program related to the Pillsbury Alliance. In the relatively short time between the February 1995 closing of the Pillsbury Alliance deal and the beginning of the 1995 vegetable pack, 37 separate major capital projects needed to be completed. There was some unforeseen problems related to a few of these projects, mostly in the New York plants. Some of the used equipment transferred from the closed plants had operating difficulties and was not always easily repaired, causing downtime. As a result, plant throughput and yields were poor at some plants causing unfavorable manufacturing variances. The problems were magnified when drought and hot weather conditions forced the uneven timing of maturities of vegetables. 7. During the quarter, Pillsbury agreed to delay the first two principal payments on the $73,025,000 subordinated promissory note until October 1998 with an option to convert the payments into the Registrant's equity. Each payment was to be $3,000,000. SENECA FOODS CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Continued) September 30, 1995 8. During the quarter, the Registrant entered into a Sale/Leaseback transaction where three of its wastewater facilities in New York State were sold to the Wayne County Water and Sewer Authority with net proceeds of $9,000,000. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION RESULTS OF OPERATIONS September 30, 1995 Results of Operations: Sales: Sales reflect an increase of 80.0% for the second quarter versus 1994. The higher sales, in large part, are due to higher canned vegetables quantities sold than the previous period and acquisitions made within the last year. Costs and Expenses: The following table shows cost and expenses as a percentage of sales: Three Months Ended Six Months Ended __________________ ________________ 9/30/95 9/24/94 9/30/95 9/24/94 _______ _______ _______ _______ Cost of Product Sold 89.6% 88.3% 87.3% 86.6% Selling 4.5 5.3 5.5 6.2 Administrative 1.7 3.7 2.0 3.4 Interest Expense 5.2 1.9 5.8 1.9 Nonrecurring Charge 11.4 - 7.0 - ------------------------------------------ 112.4% 99.2% 107.6% 98.1% ========================================== Higher Cost of Product Sold percentages (i.e. lower Gross Margins) reflect, in part, higher costs for vegetable and apple products than in the prior year due to the relatively short packs of vegetables throughout the U. S. and a worldwide shortage of apple. The Interest Expense is higher largely due to the debt issued to finance the acquisitions made over the last year. Refer to the footnotes for the discussion of the Nonrecurring Charge. Income Taxes: The effective tax rate used in fiscal 1996 is 37% and in fiscal 1995 it is 26.6%. 1995 effective tax rate reflects a year-end adjustment to arrive at a 34.5% annual rate. Financial Condition: The financial condition of the Registrant is summarized in the following table and explanatory review (In Thousands):
For the Quarter For the Year Ended September Ended March _______________ ____________ 1995 1994 1995 1994 ____ ____ ____ ____ Working Capital Balance $86,621 $60,950 $132,870 $78,180 Quarter Change (13,662) 18,641 - - Notes Payable 109,100 27,900 - - Long-Term Debt 234,701 51,428 221,480 68,546 Current Ratio 1.32:1 1.62:1 3.16:1 2.67:1 Inventory (Average) Turnover 1.6 2.3 1.9 1.8
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION RESULTS OF OPERATIONS September 30, 1995 The change in the Working Capital for the quarter from the prior year is largely due to acquisition of Green Giant assets in the prior year and the capital expenditure program needed for the Registrant's plants to take on some of the canned vegetable volume added by the acquisition. When the Registrant acquired the Green Giant assets, it did not acquire the Finished Goods. Therefore, as the Registrant produces finished goods for Pillsbury, working capital needs increase accordingly. Capital Expenditures related to the Pillsbury Alliance exceeded their original projected costs due to unforeseen issues and time constraints. Overtime and outside contractor costs were high in an effort to complete the projects by the pack season (see footnotes for discussion of Nonrecurring Charge). As part of the Alliance with Pillsbury (see 1995 Annual Report for details), Pillsbury takes Green Giant inventory as it needs it or at least by the take-or-pay date (varies by commodity). Due to the industrywide high carry-in inventory, Pillsbury began taking the Green Giant inventory in significant quantities later than expected. This has reduced the Registrant's sales and increased its inventories and associated borrowing needs for the second quarter of 1996. The Registrant was not in compliance with certain debt covenants related to Short-Term and Long-Term Debt. However, all provisions have been met or waived. The Registrant is in the process of renegotiating certain of its debt covenants. See Consolidated Statements of Cash Flows for further details. PART II - OTHER INFORMATION Item 1. Legal Proceedings None. Item 2. Changes in Securities None. Item 3. Defaults on Senior Securities None. Item 4. Submission of Matters to a Vote of Security Holders None. Item 5. Other Information None. Item 6. Exhibits and Reports on Form 8-K (a) Exhibit 11 - (11) Computation of earnings per share (b) Exhibit 27 - (27) Financial Data Schedules (c) Reports on Form 8-K - An 8-K/A was filed in August 1995 related to an amendment to an 8-K previously filed. 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. Seneca Foods Corporation (Registrant) /s/Kraig H. Kayser ___________________ November 14, 1995 Kraig H. Kayser President and Chief Executive Officer /s/Jeffrey L. Van Riper _______________________ November 14, 1995 Jeffrey L. Van Riper Controller and Chief Accounting Officer EX-11 2 EXHIBIT 11 SENECA FOODS CORPORATION AND SUBSIDIARIES COMPUTATION OF EARNINGS PER SHARE (In thousands except share data)
Three Months Ended Six Months Ended __________________ ________________ 9/30/95 9/24/94 9/30/95 9/24/94 _______ _______ _______ _______ Net Earnings Applicable to Common Stock: Net Earnings $ (10,349) $ 148 $ (10,294) $ 1,609 Deduct Preferred Cash Dividends 6 6 12 12 ------------------------------------------------------------------- Net Earnings Applicable to Common Stock $ (10,355) $ 142 $ (10,306) $ 1,597 ==================================================================== Weighted Average Common Shares Outstanding 5,593,110 5,593,110 5,593,110 5,593,860 Effect of Common Stock Equivalent - - - - ------------------------------------------------------------------- Weighted Average Common Shares Out- standing for Primary 5,593,110 5,593,110 5,593,110 5,593,860 =================================================================== Primary and Fully Diluted Earnings Per Share $ (1.85) $ .03 $ (1.84) $ .29 ===================================================================
EX-27 3
5 Commercial and Industrial Companies Article 5 of Regulation S-X 1000 6-MOS MAR-31-1996 SEP-30-1995 10740 0 41305 240 336659 361263 346001 117267 601202 274642 234701 1880 0 70 79091 601202 213924 213924 186853 186853 31046 0 12365 (16340) (6046) (10294) 0 0 0 (10294) (1.84) (1.84) OTHER-EXPENSES is Selling, General and Administrative Expenses 15968 and Nonrecurring charge 15078.
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