0000950152-95-002054.txt : 19950914 0000950152-95-002054.hdr.sgml : 19950914 ACCESSION NUMBER: 0000950152-95-002054 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950731 FILED AS OF DATE: 19950912 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: SMUCKER J M CO CENTRAL INDEX KEY: 0000091419 STANDARD INDUSTRIAL CLASSIFICATION: CANNED, FRUITS, VEG & PRESERVES, JAMS & JELLIES [2033] IRS NUMBER: 340538550 STATE OF INCORPORATION: OH FISCAL YEAR END: 0430 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-05111 FILM NUMBER: 95573158 BUSINESS ADDRESS: STREET 1: STRAWBERRY LN CITY: ORRVILLE STATE: OH ZIP: 44667 BUSINESS PHONE: 2166823000 MAIL ADDRESS: STREET 1: STRAWBERRY LANE, P.O. BOX 280 CITY: ORRVILLE STATE: OH ZIP: 44667 10-Q 1 SMUCKERS 10-Q 1 THIS COPY IS BEING SUBMITTED PURSUANT Sequential Page TO RULE 901(D) OF REGULATION S-T. No. 1 of 9 Pages 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 July 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 1-5111 ------------------------------ THE J. M. SMUCKER COMPANY Ohio 34-0538550 ---------------------- --------------------- State of Incorporation IRS Identification No. STRAWBERRY LANE ORRVILLE, OHIO 44667 (216) 682-3000 The Company has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the precedings and has been subject to such filing requirements for the past 90 days. The Company had 14,384,839 Class A Common Shares and 14,778,839 Class B Common Shares outstanding on July 31, 1995. The Exhibit Index is located at Sequential Page No. 9. 2 Sequential Page No. 2 PART I. FINANCIAL INFORMATION THE J. M. SMUCKER COMPANY CONDENSED STATEMENTS OF CONSOLIDATED INCOME (Unaudited) Item 1. Financial Statements --------------------
Three Months Ended July 31, ------------------------ 1995 1994 -------- --------- (Dollars in thousands, except per share data) Net Sales $147,965 $144,347 Cost of products sold 94,619 93,403 -------- -------- 53,346 50,944 Selling, distribution, and administrative expenses 36,984 35,739 -------- -------- 16,362 15,205 Interest income 156 196 Other income - net 874 699 -------- -------- 17,392 16,100 Interest expense 1,201 739 -------- -------- INCOME BEFORE INCOME TAXES 16,191 15,361 Income taxes 6,667 6,146 -------- -------- NET INCOME $ 9,524 $ 9,215 ======== ======= Net income per Common Share* $ .33 $ .32 ===== ====== Dividends declared on Class A Common Shares $ .13 $ .125 ===== ====== Dividends declared on Class B Common Shares $ .13 $ .125 ===== ====== * Computed on the weighted average number of Class A Common Shares and Class B Common Shares out- standing, namely 29,163,678 29,131,744
See notes to condensed, consolidated financial statements. 3 Sequential Page No. 3 THE J. M. SMUCKER COMPANY CONDENSED CONSOLIDATED BALANCE SHEETS
July 31, 1995 April 30, 1995 (Unaudited) (Audited) ----------- ------------ ASSETS (Dollars in Thousands) CURRENT ASSETS Cash and cash equivalents $14,464 $ 11,244 Trade receivables, less allowances 55,455 53,600 Inventories: Finished products 68,090 49,825 Raw materials, containers, and supplies 80,718 60,849 -------- -------- 148,808 110,674 Other current assets 13,512 16,318 -------- -------- Total Current Assets 232,239 191,836 PROPERTY, PLANT, AND EQUIPMENT Land and land improvements 14,747 14,260 Buildings and fixtures 72,002 72,079 Machinery and equipment 149,276 144,141 Construction in progress 7,997 5,605 ------- ------- 244,022 236,085 Less allowances for depreciation (99,553) (95,960) -------- -------- Total Property, Plant and Equipment 144,469 140,125 OTHER NONCURRENT ASSETS Goodwill 40,241 40,621 Trademarks and patents 39,689 40,019 Other assets 10,169 8,416 -------- -------- Total Other Noncurrent Assets 90,099 89,056 -------- -------- $466,807 $421,017 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $ 50,049 $ 40,527 Notes payable 24,500 0 Salaries, wages, and additional compensation 9,551 10,235 Accrued marketing and merchandising 14,527 14,260 Income taxes 8,317 3,858 Other current liabilities 12,567 10,963 ------- ------- Total Current Liabilities 119,511 79,843 NONCURRENT LIABILITIES 83,569 83,182 SHAREHOLDERS' EQUITY Class A Common Shares, outstanding shares: 3,596 3,596 14,384,839 at stated value Class B Common Shares (Non-voting),out- 3,695 3,695 standing shares: 14,778,839 at stated value Additional capital 10,963 10,963 Retained income 260,600 254,854 Less: Deferred compensation (1,151) (1,292) Amount due from ESOP Trust (10,441) (10,441) Currency translation adjustment (3,535) (3,383) -------- --------- Total Shareholders' Equity 263,727 257,992 -------- -------- $466,807 $421,017 ======== ========
See notes to condensed, consolidated financial statements. 4 Sequential Page No. 4 THE J. M. SMUCKER COMPANY CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Three Months Ended July 31 ------------------------------ (Dollars in Thousands) 1995 1994 --------- --------- NET CASH USED FOR OPERATING ACTIVITIES $ (9,124) $(19,923) CASH FLOWS FROM INVESTING ACTIVITIES Business acquired - net of cash -0- (22,282) Additions to property, plant, and equipment (8,697) (4,806) Proceeds from the sale of property, plant, and equipment 121 159 Other - net -0- (39) -------- -------- NET CASH USED FOR INVESTING ACTIVITIES (8,576) (26,968) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from short-term debt 24,500 42,000 Dividends paid (3,779) (3,634) Other - net 159 (185) -------- -------- NET CASH PROVIDED BY FINANCING ACTIVITIES 20,880 38,181 Effect of exchange rate changes 40 114 Net Increase/(Decrease) in Cash and Cash Equivalents 3,220 (8,596) Cash and Cash Equivalents at Beginning of Period 11,244 14,059 ------- ------- Cash and Cash Equivalents at End of Period $14,464 $ 5,463 ======= ======= ( ) Denotes use of cash
See notes to condensed, consolidated financial statements. 5 Sequential Page No. 5 THE J. M. SMUCKER COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note A - Basis of Presentation --------------------- The accompanying unaudited, condensed, consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The seasonal nature of the Mrs. Smith's business will have its most significant impact on the Company's business during the second and third quarters. For further information, reference is made to the consolidated financial statements and footnotes included in the Company's Annual Report on Form 10-K for the year ended April 30, 1995. Note B - Common Shares ------------- At July 31, 1995, 35,000,000 Class A Common Shares and 35,000,000 Class B Common Shares were authorized. Outstanding shares of each class are shown net of 1,827,449 Class A and 1,433,449 Class B treasury shares at both July 31, 1995 and April 30, 1995. Note C - Accounting Reclassifications ---------------------------- Certain prior year amounts have been reclassified to conform to current year classifications. Note D - Income Per Share ---------------- Income per share has been computed based on the weighted average number of shares of the Class A Common Shares and Class B Common Shares considered outstanding during the period. * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Item 2. Management's Discussion and Analysis ------------------------------------ This discussion and analysis deals with comparisons of material changes in the condensed, consolidated financial statements for the three-month periods ended July 31, 1995 and 1994, respectively. 6 Sequential Page No. 6 Results of Operations --------------------- Sales for the first quarter ended July 31, 1995 were $147,965,000, up approximately 3% over the same period last year. Sales were up over the prior year in the Consumer, Beverage, Foodservice, Industrial, and International business areas. In the Consumer area, the growth was led by increases in sales of Simply Fruit and Low Sugar fruit spreads and Sundae Syrups ice cream toppings, plus the addition of the Laura Scudder's natural peanut butter business, which was acquired in the third quarter of fiscal 1995. The increase in the Beverage area was the result of the inclusion of a full quarter's sales of the After The Fall business, acquired in July 1994. In the International area, most of the increase came from higher sales of Smucker's branded products in Latin America and Eastern Europe. Sales of Mrs. Smith's products were down from the first quarter of last fiscal year, primarily due to the discontinuation of the SmartStyle line, which was in national distribution last year. Earnings for the quarter were $9,524,000, or $.33 per share, compared to $9,215,000, or $.32 per share for the same period last year. All business areas, with the exception of International, contributed to the earnings growth during the quarter. Mrs. Smith's earnings were up modestly for the quarter, despite lower sales. With respect to Mrs. Smith's, new marketing and sales initiatives are in place for the upcoming holiday season, which will focus on reinforcing both the brand's home-baked image and its value perception with consumers. Although this will result in somewhat higher expenditures for Mrs. Smith's than during the holiday season last year and, as a result, reduce the Mrs. Smith's contribution to earnings during the second and third quarters, this is consistent with the Company's long-term plans to support the brand and generate continuing growth of Mrs. Smith's sales and share of market. Cost of products sold during the quarter decreased as a percentage of sales compared to the same period last year. The decrease was a result of lower raw material costs on certain key fruits and a change in mix of products sold as a result of a shift in timing of certain grocery promotions. Selling, distribution, and administration costs increased at a rate slightly higher than the increase in sales due primarily to increased distribution and selling expenses associated with the After The Fall business. Interest expense was up over the same period last year due to an increase in the average outstanding debt balance. Debt was higher because of the fiscal 1995 acquisitions of the After The Fall and Laura Scudder's businesses for cash. This additional expense was partially offset by an increase in other non-operating income, notably increased profits on the sale of excess fruit inventories. Income taxes increased at a slightly greater rate than income before tax (8.5% vs. 5.4%), due to a higher estimated effective federal tax rate and increased state and local taxes. 7 Sequential Page No. 7 Financial Condition - Liquidity and Capital Resources ----------------------------------------------------- The Company's financial position continues to be strong despite the increase in debt during the first quarter. The increase in debt since April 30, 1995, was primarily to fund the seasonal procurement of fruit. The majority of fruit purchases occur during the first half of the year. Other significant uses of cash during the quarter were capital expenditures and the payment of dividends. During the second quarter, the Company will continue to borrow against its revolving credit line in order to finance remaining fruit purchases and other working capital requirements. The Company expects that borrowings will peak during the quarter but remain within the $125 million maximum under the credit line. Despite the current debt level, the Company anticipates that, in the absence of future acquisitions or similar unplanned events, cash from continuing operations this year will be sufficient to reduce the outstanding fiscal year-end debt balance to a lower level than at the prior year-end. Item 6. Exhibits and Reports on Form 8-K -------------------------------- (a) Exhibits -------- See the Index of Exhibits that appears on Sequential Page No. 9 of this report. (b) Reports on Form 8-K ------------------- No Reports on Form 8-K were required to be filed during the quarter for which this report is filed. 8 Sequential Page No. 8 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. September 12, 1995 THE J. M. SMUCKER COMPANY BY STEVEN J. ELLCESSOR Secretary AND RICHARD K. SMUCKER President 9 Sequential Page No. 9 INDEX OF EXHIBITS That are filed with the Commission and the New York Stock Exchange
Assigned Sequential Exhibit No. * Description Page No. ---------------------------------------------------------------------------------------- 4 (a) Industrial Development Revenue Bond Project ** Agreement dated as of December 1, 1986. (b) Revolving credit agreement between The J. M. Smucker Company and Society National Bank (individually and as Agent), National City Bank, and the First National Bank of Chicago dated as of April 27, 1994, incorporated by reference to the Quarterly Report on Form 10-Q for the period ended July 31, 1994. (c) First Amendment to the revolving credit agreement between The J. M. Smucker Company and Society National Bank (individually and as Agent), National City Bank, and the First National Bank of Chicago dated as of April 25, 1995, incorporated by reference to the Annual Report on Form 10-K for the period ended April 30, 1995. 27 Financial data schedules pursuant to Article 5 in Regulation S-X. * Exhibits 2, 10, 11, 15, 18, 19, 22, 23, and 24 are either inapplicable to the Company or require no answer. ** As permitted by Item 601(b)(4)(iii) of Regulation S-K, no copy of this instrument is filed; however, a copy will be furnished to the Commission upon request.
EX-27 2 SMUCKERS 10-Q EX-27
5 1,000 3-MOS APR-30-1995 MAY-01-1995 JUL-31-1995 14,464 0 57,674 2,219 148,808 232,239 244,022 99,553 466,807 119,511 0 7,291 0 0 256,436 466,807 147,965 147,965 94,619 94,619 36,984 0 1,201 16,191 6,667 9,524 0 0 0 9,524 .33 .33