-----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, DGMpqh9R7o1Jvk+u5mA8gJRgDsImLhk+wrUqHH2qxLuSjZ+G6nxuTTmKVj10gnfY pPQKUir6GzWNiqqUPQN24g== /in/edgar/work/20000804/0000950159-00-000295/0000950159-00-000295.txt : 20000921 0000950159-00-000295.hdr.sgml : 20000921 ACCESSION NUMBER: 0000950159-00-000295 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000726 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20000804 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IOS CAPITAL INC CENTRAL INDEX KEY: 0000922255 STANDARD INDUSTRIAL CLASSIFICATION: [5110 ] IRS NUMBER: 232493042 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-20405 FILM NUMBER: 686127 BUSINESS ADDRESS: STREET 1: 1738 BASS RD CITY: MACON STATE: GA ZIP: 31210 BUSINESS PHONE: 9124712300 MAIL ADDRESS: STREET 1: 1738 BASS RD CITY: MACON STATE: GA ZIP: 31210 FORMER COMPANY: FORMER CONFORMED NAME: IKON CAPITAL INC DATE OF NAME CHANGE: 19980113 FORMER COMPANY: FORMER CONFORMED NAME: ALCO CAPITAL RESOURCE INC DATE OF NAME CHANGE: 19940425 8-K 1 0001.txt SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) July 26, 2000 IOS Capital, Inc. (Exact name of registrant as specified in its charter) --------------------------------------- DELAWARE File No. 0-20405 23-2493042 ------------ --------------------- ------------------ (State or other (Commission File (IRS Employer jurisdiction of Number) Identification incorporation) Number) 1738 Bass Road, Macon, Georgia 31210 Registrant's telephone number, including area code: (912) 471-2300 -------------- Not Applicable ---------------------------------------------------------------- (Former name or former address, if changed since last report) Item 5. Other Events. ------------ On July 26, 2000, the Registrant's parent, IKON Office Solutions, Inc. ("IKON"), announced results for the third quarter of fiscal year 2000. IKON's press release dated July 26, 2000 containing further detail is attached. This Report includes or incorporates by reference information about the Registrant and/or IKON which may constitute forward-looking statements within the meaning of the federal securities laws, including, but not limited to: statements concerning expected growth from IKON's investments; expected results of Ikon's growth initiatives; and IKON's fourth quarter outlook. Although the Registrant believes the expectations contained in such forward-looking statements are reasonable, it can give no assurances that such expectations will prove correct. Such forward-looking statements are based upon the Registrant's and/or IKON's current plans or expectations and are subject to a number of risks and uncertainties applicable to both the Registrant and IKON, including, but not limited to, risks and uncertainties relating to conducting operations in a competitive environment and a changing industry; delays, difficulties, management transitions and employment issues associated with consolidation of, and/or changes in business operations; managing the integration of existing and acquired companies; risks and uncertainties associated with existing or future vendor relationships; and general economic conditions. Certain additional risks and uncertainties are set forth in the Registrant's 1999 Annual Report on Form 10-K/A filed with the Securities and Exchange Commission. As a consequence of these and other risks and uncertainties, the Registrant's current plans, anticipated actions and future financial condition and results may differ materially from those expressed in any forward-looking statements. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. ------------------------------------------------------------------ c. The following exhibits are furnished in accordance with the provisions of Item 601 of Regulation S-K: (99) Press Release dated July 26, 2000 SIGNATURE 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. IOS CAPITAL, INC. By: /s/ HARRY KOZEE -------------------------- Harry Kozee Vice President - Finance Dated: August 4, 2000 EX-99 2 0002.txt Exhibit 99 Contacts: Veronica L. Rosa Steven K. Eck Investor Relations Media Relations 610-408-7196 610-408-7295 vrosa@ikon.com seck@ikon.com IKON OFFICE SOLUTIONS ANNOUNCES THIRD QUARTER RESULTS Cites Double-Digit Growth in Office Equipment Sales Continues Expansion of Product and Services Portfolio Valley Forge, Pennsylvania - July 26, 2000 - IKON Office Solutions (NYSE: IKN) today reported results for the third quarter of fiscal 2000. For the quarter ended June 30, 2000, IKON reported net income of $31.6 million, or $.21 per common share, including onetime gains from early extinguishment of debt and the sale of investments totaling $.02 per common share. This compares to net income of $27.3 million, or $.18 per common share, for the same period in 1999. Revenues for the quarter were $1.42 billion, a 2% increase from the prior year. Without the negative effect of foreign currency translation, revenue growth would have been 3%. "The quarter was characterized by double-digit growth in office equipment sales and continued investment in our growth initiatives designed to deliver a broader range of differentiated products and services to our customers," said James J. Forese, Chairman and Chief Executive Officer of IKON Office Solutions. "Amid tough competition industry-wide, we continued to produce strong growth in sales of office equipment, especially digital, color and high-end technology, registering 15% growth compared to a year ago. Digital revenues were 85% of total equipment revenues, evidence that IKON has a strong sales organization with a tremendous potential to seize the growing opportunities in the digital marketplace. We believe our growth in this marketplace will continue to benefit from the investments we have made in realigning our sales force for more consultative and integrated solution selling. Adding further to our growth potential, we continue to invest in new products and services, thus adding to our array of state-of-the-art solutions that help customers communicate business information more effectively." In terms of IKON's total revenue, the Company's strong growth in equipment sales was partially offset by declines in technology services and outsourcing revenue compared to a year ago. "This largely reflects the closing of certain non-strategic locations as part of our restructuring program," Forese stated. "Also, the demand for technology services was unusually high in the third quarter of last year." Ongoing Actions to Diversify Revenue Base Forese noted that IKON has been responding to industry-wide changes in distribution models and customer applications by taking a number of decisive steps to diversify its revenue base. "We are broadening the range of solutions we offer and entering new markets that offer significant opportunity," he stated. "For example, we are moving aggressively to become a leading e-services provider with offerings like IKON's Digital Express(R) 2000, which allows customers to access our nationwide network of digital print production centers via the Internet, and Virtual File Room(TM), IKON's Web-based document repository designed to support a collaborative, distributed work process for complex litigation. We are also extending our reach in the high-opportunity markets that we have targeted by expanding our range of strategic alliances, joining forces with leading solutions providers whose capabilities align with ours. "In addition, we are developing comprehensive e-business solutions to enhance our competitive position and make it easier for our customers to do business with us. This includes a pilot program currently underway for major-account customers, allowing the purchase of contracted equipment and supplies, and access to customer service via the Web," Forese stated. Forese said that IKON will continue to leverage its broad base of capabilities and expertise to stay ahead in a rapidly evolving marketplace, and will continue to invest in the latest technologies and support that customers require, building customized solutions that differentiate IKON in the market. For example, during the current fiscal year, IKON has: o Expanded sales coverage by an additional 475 sales representatives since the beginning of the fiscal year against a full year goal of 400-500, with a focus on key growth areas; o Expanded its high-end, digital product offerings for the production market by introducing state-of-the-art imaging systems, including the Canon imageRUNNER 110 and the Ricoh Aficio 850, using the T/R Systems MicroPress for cluster printing; o Aligned its outsourcing operations to leverage organizational synergies and to expand its share of the customer's business, through on-site facilities management, outsourced commercial printing and increased attention to the legal market, including corporate legal departments; o Introduced Digital Express 2000, IKON's solution for e-procurement in the production print market, and formed alliances with print e-procurement providers like Fatbrain.com and iPrint.com, leveraging their front-end, order-taking capabilities to expand the revenue base of IKON's network of digital print production centers; o Introduced Virtual File Room, an internally developed, secure Web-based document repository; o Partnered with leading vendors to enhance its digital technology offerings - including Splash Technology for office color, Adobe for hardcopy/softcopy convergence, and Solimar and RSA for handling data center print streams; and o Announced the merger of its network integration resources into its core business to optimize IKON's ability to deliver fully integrated business communications solutions. In addition, during the third quarter, the Company completed the repurchase of the remaining 2.2 million shares under its 1997 share repurchase authorization. The Company is currently executing the stock repurchase program authorized by the Board of Directors on June 23, 2000, which allowed for up to $75 million of the Company's common stock to be repurchased. Fourth Quarter Outlook "We believe we are making the right investments to expand our existing business and capture opportunities in new markets, such as print-on-demand services, production printing and e-procurement of printed documents - all markets with double-digit growth rates. We will continue to make these investments. However, going into the fourth quarter, we anticipate increased industry competition. Given intensifying competitive pressure and the impact of repositioning IKON's technology services, our fourth quarter earnings should remain flat on a sequential basis, but with substantial improvement year over year," stated Forese. "We anticipate revenue growth in the fourth quarter should be in the 4% - - 6% range year over year, fueled by continued growth in equipment sales. "I think it is clear that our industry is in a period of transition," Forese stated. "No player in this industry can stand still and stay wedded to old ways of doing business. Each player has to leverage its existing strengths to generate new opportunities. IKON is doing just that." IKON Office Solutions (www.ikon.com) is one of the world's leading providers of products and services that help businesses communicate. IKON provides customers with total business solutions for every office, production and outsourcing need, including copiers and printers, color solutions, distributed printing, facilities management, imaging and legal outsourcing solutions, as well as network design and consulting, e-business development and technology training. With fiscal 1999 revenues of $5.5 billion, IKON has approximately 900 locations worldwide including the United States, Canada, Mexico, the United Kingdom, France, Germany, Ireland, and Denmark. This news release includes information which may constitute forward-looking statements within the meaning of the federal securities laws, including, but not limited to: statements concerning expected growth from the company's investments; expected results of IKON's growth initiatives and IKON's fourth quarter outlook. Although IKON believes the expectations contained in such forward-looking statements are reasonable, it can give no assurances that such expectations will prove correct. Such forward-looking statements are based upon management's current plans or expectations and are subject to a number of risks and uncertainties, including, but not limited to, risks and uncertainties relating to conducting operations in a competitive environment and a changing industry; delays, difficulties, management transitions and employment issues associated with consolidation of, and/or changes in business operations; managing the integration of existing and acquired companies; risks and uncertainties associated with existing or future vendor relationships; and general economic conditions. Certain additional risks and uncertainties are set forth in IKON's 1999 Annual Report on Form 10-K/A filed with the Securities and Exchange Commission. As a consequence of these and other risks and uncertainties, IKON's current plans, anticipated actions and future financial condition and results may differ materially from those expressed in any forward-looking statements. IKON Office Solutions, Inc. FINANCIAL SUMMARY (in thousands, except earnings per share)
Third Quarter Fiscal ------------------------------------ 2000 1999 % Change --------------- ---------------- ----------------- Revenues Net sales $ 740,959 $ 719,047 3.0 % Service and rentals 583,524 595,573 (2.0) Finance income 92,922 70,847 31.2 - --------------------------------------------------------------------------------------------- 1,417,405 1,385,467 2.3 - --------------------------------------------------------------------------------------------- Costs and Expenses Cost of goods sold 503,809 500,614 0.6 Service and rental costs 349,438 338,498 3.2 Finance interest expense 43,889 30,553 43.6 Selling and administrative 451,797 447,785 0.9 - --------------------------------------------------------------------------------------------- 1,348,933 1,317,450 2.4 - --------------------------------------------------------------------------------------------- Operating income 68,472 68,017 0.7 Gain on sale of investment 3,288 Interest expense 18,314 17,031 7.5 - --------------------------------------------------------------------------------------------- Income before income taxes 53,446 50,986 4.8 Income taxes 23,525 23,708 (0.8) - --------------------------------------------------------------------------------------------- Income before extraordinary gain 29,921 27,278 9.7 Extraordinary gain from early extinguishment of debt, net of tax benefit 1,707 - --------------------------------------------------------------------------------------------- Net income $ 31,628 $ 27,278 15.9 =============== ================ Basic Earnings Per Common Share $0.21 $0.18 =============== ================ Diluted Earnings Per Common Share $0.21 $0.18 =============== ================ Weighted Average Common Shares Outstanding, Basic 148,922 148,787 =============== ================ Weighted Average Common Shares Outstanding, Diluted 148,941 149,115 =============== ================ Operations Analysis: Gross profit %, net sales 32.0% 30.4% Gross profit %, service and rentals 40.1% 43.2% Gross profit %, finance subsidiaries 52.8% 56.9% Total gross profit % 36.7% 37.2% Selling and administrative as a % of revenue 31.9% 32.3% Operating income as a % of revenue 4.8% 4.9%
IKON Office Solutions, Inc. FINANCIAL SUMMARY (in thousands, except earnings per share) EXCLUDING SPECIAL ITEMS
Third Quarter Fiscal ------------------------------------ 2000 * 1999 % Change --------------- ---------------- ----------------- Revenues Net sales $ 740,959 $ 719,047 3.0 % Service and rentals 583,524 595,573 (2.0) Finance income 92,922 70,847 31.2 - ----------------------------------------------------------------------------------------------- 1,417,405 1,385,467 2.3 - ----------------------------------------------------------------------------------------------- Costs and Expenses Cost of goods sold 503,809 500,614 0.6 Service and rental costs 349,438 338,498 3.2 Finance interest expense 43,889 30,553 43.6 Selling and administrative 451,797 447,785 0.9 - ----------------------------------------------------------------------------------------------- 1,348,933 1,317,450 2.4 - ----------------------------------------------------------------------------------------------- Operating income 68,472 68,017 0.7 Interest expense 18,314 17,031 7.5 - ----------------------------------------------------------------------------------------------- Income before income taxes 50,158 50,986 (1.6) Income taxes 22,078 23,708 (6.9) - ----------------------------------------------------------------------------------------------- Net income $ 28,080 $ 27,278 2.9 =============== ================ Basic Earnings Per Common Share $0.19 $0.18 =============== ================ Diluted Earnings Per Common Share $0.19 $0.18 =============== ================ Weighted Average Common Shares Outstanding, Basic 148,922 148,787 =============== ================ Weighted Average Common Shares Outstanding, Diluted 148,941 149,115 =============== ================ Operations Analysis: Gross profit %, net sales 32.0% 30.4% Gross profit %, service and rentals 40.1% 43.2% Gross profit %, finance subsidiaries 52.8% 56.9% Total gross profit % 36.7% 37.2% Selling and administrative as a % of revenue 31.9% 32.3% Operating income as a % of revenue 4.8% 4.9%
* Third quarter fiscal 2000 excludes $3,288 gain on sale of investment and $3,049 extraordinary gain on early retirment of debt ($1,707 after-tax). This information is provided for additional analysis and is not intended to be a presentation in accordance with generally accepted accounting principles. IKON Office Solutions, Inc. FINANCIAL SUMMARY (in thousands, except earnings per share)
Year To Date Fiscal ------------------------------- 2000 1999 % Change ------------- ------------- --------------- Revenues Net sales $ 2,137,370 $ 2,146,828 (0.4)% Service and rentals 1,737,774 1,782,494 (2.5) Finance income 255,089 225,212 13.3 - -------------------------------------------------------------------------------------------------- 4,130,233 4,154,534 (0.6) - -------------------------------------------------------------------------------------------------- Costs and Expenses Cost of goods sold 1,438,975 1,464,723 (1.8) Service and rental costs 1,048,707 1,031,211 1.7 Finance interest expense 122,849 92,539 32.8 Selling and administrative 1,314,579 1,370,636 (4.1) Restructuring and asset impairment charge 105,340 - -------------------------------------------------------------------------------------------------- 4,030,450 3,959,109 1.8 - -------------------------------------------------------------------------------------------------- Operating income 99,783 195,425 (48.9) Gain on sale of investment 3,288 Interest expense 51,934 55,573 (6.5) - -------------------------------------------------------------------------------------------------- Income before income taxes 51,137 139,852 (63.4) Income taxes 41,999 61,031 (31.2) - -------------------------------------------------------------------------------------------------- Income before extraordinary gain 9,138 78,821 (88.4) Extraordinary gain from early extinguishment of debt, net of tax benefit 1,707 - -------------------------------------------------------------------------------------------------- Net income $ 10,845 $ 78,821 (86.2) ============= ============= Basic Earnings Per Common Share $0.07 $0.53 ============= ============= Diluted Earnings Per Common Share $0.07 $0.53 ============= ============= Weighted Average Common Shares Outstanding, Basic 149,158 148,576 ============= ============= Weighted Average Common Shares Outstanding, Diluted 149,317 148,961 ============= ============= Operations Analysis: Gross profit %, net sales 32.7% 31.8% Gross profit %, service and rentals 39.7% 42.1% Gross profit %, finance subsidiaries 51.8% 58.9% Total gross profit % 36.8% 37.7% Selling and administrative as a % of revenue 31.8% 33.0% Operating income as a % of revenue 2.4% 4.7%
IKON Office Solutions, Inc. FINANCIAL SUMMARY (in thousands, except earnings per share) EXCLUDING SPECIAL ITEMS
Year To Date Fiscal ----------------------------------- 2000 * 1999 ** % Change --------------- --------------- ----------------- Revenues Net sales $ 2,137,370 $ 2,146,828 (0.4)% Service and rentals 1,737,774 1,782,494 (2.5) Finance income 255,089 210,879 21.0 - ----------------------------------------------------------------------------------------------- 4,130,233 4,140,201 (0.2) - ----------------------------------------------------------------------------------------------- Costs and Expenses Cost of goods sold 1,438,975 1,464,723 (1.8) Service and rental costs 1,048,707 1,031,211 1.7 Finance interest expense 122,849 92,539 32.8 Selling and administrative 1,331,579 1,370,636 (2.8) - ----------------------------------------------------------------------------------------------- 3,942,110 3,959,109 (0.4) - ----------------------------------------------------------------------------------------------- Operating income 188,123 181,092 3.9 Interest expense 51,934 55,573 (6.5) - ----------------------------------------------------------------------------------------------- Income before income taxes 136,189 125,519 8.5 Income taxes 59,923 55,298 8.4 - ----------------------------------------------------------------------------------------------- Net income $ 76,266 $ 70,221 8.6 =============== =============== Basic Earnings Per Common Share $0.51 $0.47 =============== =============== Diluted Earnings Per Common Share $0.51 $0.47 =============== =============== Weighted Average Common Shares Outstanding, Basic 149,158 148,576 =============== =============== Weighted Average Common Shares Outstanding, Diluted 149,317 148,961 =============== =============== Operations Analysis: Gross profit %, net sales 32.7% 31.8% Gross profit %, service and rentals 39.7% 42.1% Gross profit %, finance subsidiaries 51.8% 56.1% Total gross profit % 36.8% 37.5% Selling and administrative as a % of revenue 32.2% 33.1% Operating income as a % of revenue 4.6% 4.4%
* Fiscal 2000 excludes $3,288 gain on sale of investment, $3,049 extraordinary gain from the early retirement of debt ($1,707 after-tax), $17,000 of shareholder litigation insurance proceeds and $105,340 restructuring and asset impairment charge. ** Fiscal 1999 excludes $14,333 gain on asset securitization. This information is provided for additional analysis and is not intended to be a presentation in accordance with generally accepted accounting principles. -----END PRIVACY-ENHANCED MESSAGE-----