-----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, QKR2hU7KxV8iRDdmOZbJ+6U7T5z7J1CqD3BnwSl6dD8HY+es0vSGvAWFB7Mcnroz Tc9oSrSZZ1Slg8tVkinTvg== 0000950159-01-500063.txt : 20010504 0000950159-01-500063.hdr.sgml : 20010504 ACCESSION NUMBER: 0000950159-01-500063 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20010426 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20010503 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IOS CAPITAL INC CENTRAL INDEX KEY: 0000922255 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-PAPER AND PAPER PRODUCTS [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: 1621063 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 ios8k5-2.txt IOS CAPITAL, INC. FORM 8-K 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) April 26, 2001 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 April 26, 2001, the Registrant's parent, IKON Office Solutions, Inc. ("IKON" or the "Company"), announced results for the second quarter of fiscal year 2001. IKON's press release dated April 26, 2001 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. These forward-looking statements include, but are not limited to, statements relating to the Company's outlook for the third quarter and the full year and the Company's long-term returns from its investments. 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. 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. Certain additional risks and uncertainties are set forth in IKON's 2000 Annual Report on Form 10-K/A filed with the Securities and Exchange Commission. 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 April 26, 2001 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: May 3, 2001 EX-99 2 iosex99.txt EXHIBIT 99 Exhibit 99 IKON OFFICE SOLUTIONS ANNOUNCES SECOND QUARTER RESULTS Earnings on Target Cash Flow Outlook Remains Strong Valley Forge, Pennsylvania - April 26, 2001 - IKON Office Solutions (NYSE:IKN) today announced results for the second fiscal quarter ended March 31, 2001. Earnings for the second quarter were $16.7 million, or $.12 per share. For the same period in 2000, earnings were $.17 per share, or $.23 per share including a one-time gain from insurance proceeds. Revenues for the second quarter of fiscal 2001 were $1.36 billion, comparable to the same period in 2000. Without the negative effect of foreign currency, revenue growth for the second quarter of fiscal 2001 would have been 1%. "Our revenues and earnings results were solid this quarter, despite a tough competitive and economic climate," stated James J. Forese, Chairman and Chief Executive Officer. "Earnings of $.12 per share were in line with our expectations and reflect the ongoing investments we are making to continue to position the Company for stronger, long-term returns. We feel that these ongoing investments, which have impacted our earnings, are a necessity for long-term revenue growth and operating margin improvement. In addition, our balance sheet and cash flow position remain strong. During the second quarter, we achieved greater asset productivity as evidenced in our days sales outstanding and inventory turn measurements, and based on first half results, our free cash flow outlook for the year remains on target at $170 - $185 million." Revenues of $1.36 billion included continued growth in the Company's targeted markets, including outsourcing and the high-volume, Segment 5 and 6 copier/printer equipment for the production market. IKON's principal outsourcing offering, facilities management, secured its fifth sequential quarter of double-digit growth. However, revenue growth was offset by declines in other markets that the Company has de-emphasized, such as low-margin technology hardware. "Our high-end equipment sales and outsourcing results are representative of IKON's response to our customers' needs for a partner that can provide a host of services on a strong equipment platform," stated Mr. Forese. "With more complex technologies and a greater variety of document management applications available from many vendors today, IKON's multi-vendor product portfolio, our proven technical service support, and our array of integrated outsourcing offerings serve to make IKON a valuable partner for any customer." Net Sales, which include the sale of copier/printer equipment, supplies, and technology hardware, declined 0.5% from the prior year. Positive growth in copier/printer equipment sales was offset by the anticipated decline in certain technology hardware. Copier/printer equipment sales were led by the placement of new, higher-volume digital technologies not available in the prior year, primarily the Ricoh Aficio 850 and 1050 and the Canon imageRUNNER 110. Gross profit margin on Net Sales was slightly up from the prior year, reflecting a mix of increased competitive pressures offset by the benefit of less low-margin technology hardware in current year results. Service & Rentals, which include revenues from the servicing of copier/printer equipment, outsourcing, technology services, and rentals, declined 1.5% from the prior year. Growth in outsourcing was offset by declines in equipment service and rental revenues, as the Company's overall Service & Rentals revenue base transitions to higher-end, digital technologies and outsourcing. Service & Rentals gross profit margin remained stable from the prior year reflecting excellent improvement in the margins associated with equipment service. Finance Income generated by the Company's captive leasing organizations grew 15.9% from the prior year reflecting the Company's ongoing success in utilizing leasing as a competitive differentiator. Gross profit margin on Finance Income was essentially unchanged from the prior year. Operating margins of 3.6% improved sequentially but were down from the prior year primarily due to increased Selling and Administrative expenses. Selling and Administrative expenses have increased as the Company accelerated certain targeted investments designed to improve its infrastructure and competitive edge long-term. These investments include the continued development of e-services such as Digital Express(R) 2000; expanded sales coverage and training directed toward integrated solutions and major accounts; the Company's comprehensive e-commerce initiative; and additional infrastructure technology costs to support the Company's ongoing productivity programs. The Company's productivity programs are designed to generate continued savings over the next 18 to 24 months. "Our outlook for the long-term continues to be positive," stated Mr. Forese. "However, we realize that today's economic climate dictates a more conservative program, as companies focus on the quality of their balance sheets, cash flows, and cost structures. Accordingly, while we will remain committed to continuing our investments that have facilitated the great progress IKON has made in converting to an integrated, services-oriented operating company, for the second half of our fiscal year we will be taking more aggressive actions to minimize our costs. "For the third quarter, we expect our earnings per share to show sequential improvement, but a decline from the prior year (excluding special items) due to the higher level of investments this year," continued Mr. Forese. "IKON's reputation has solidified as a strong and established company that is able to provide customers with innovative, comprehensive business communications solutions. We will continue to differentiate IKON from our competitors to ensure our position as a valuable partner to our customers," concluded Mr. Forese. ================================================================================ ================================================================================ 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 document solutions, as well as network design and consulting, e-business development, telecommunications services and technology training. With fiscal 2000 revenues of $5.4 billion, IKON has approximately 800 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. These forward-looking statements include, but are not limited to, statements relating to the Company's outlook for the third quarter and the full year and the Company's long-term returns from its investments. 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. 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. Certain additional risks and uncertainties are set forth in IKON's 2000 Annual Report on Form 10-K/A filed with the Securities and Exchange Commission. # # # Exhibit 99 IKON Office Solutions, Inc. - --------------------------- FINANCIAL SUMMARY (in thousands, except earnings per share)
Second Quarter Fiscal ----------------------------- 2001 2000 % Change ---------- ---------- -------------- Revenues Net sales $ 704,719 $ 708,467 (0.5)% Service and rentals 562,520 571,329 (1.5) Finance income 93,987 81,070 15.9 - ---------------------------------------------------------------------------------------- 1,361,226 1,360,866 0.0 - ---------------------------------------------------------------------------------------- Costs and Expenses Cost of goods sold 460,619 464,612 Service and rental costs 348,891 353,831 Finance interest expense 44,363 39,508 Selling and administrative 458,356 424,559 - ---------------------------------------------------------------------------------------- 1,312,229 1,282,510 - ---------------------------------------------------------------------------------------- Operating income 48,997 78,356 Interest expense 19,123 17,626 - ---------------------------------------------------------------------------------------- Income before income taxes 29,874 60,730 Income taxes 13,144 25,877 - ---------------------------------------------------------------------------------------- Net income $ 16,730 $ 34,853 ========== ========== Basic and Diluted Earnings Per Common Share $ 0.12 $ 0.23 ========== ========== Weighted Average Common Shares Outstanding, Basic 141,402 149,297 ========== ========== Weighted Average Common Shares Outstanding, Diluted 143,262 149,592 ========== ========== Operations Analysis: Gross profit %, net sales 34.6% 34.4% Gross profit %, service and rentals 38.0% 38.1% Gross profit %, finance subsidiaries 52.8% 51.3% Total gross profit % 37.3% 37.0% Selling and administrative as a % of revenue 33.7% 31.2% Operating income as a % of revenue 3.6% 5.8%
Exhibit 99 IKON Office Solutions, Inc. - --------------------------- FINANCIAL SUMMARY (in thousands, except earnings per share) Excluding Special Items
Second Quarter Fiscal ----------------------------- 2001 2000 % Change ---------- ---------- ---------- Revenues Net sales $ 704,719 $ 708,467 (0.5)% Service and rentals 562,520 571,329 (1.5) Finance income 93,987 81,070 15.9 - ---------------------------------------------------------------------------------------- 1,361,226 1,360,866 0.0 - ---------------------------------------------------------------------------------------- Costs and Expenses Cost of goods sold 460,619 464,612 Service and rental costs 348,891 353,831 Finance interest expense 44,363 39,508 Selling and administrative 458,356 441,559 * - ---------------------------------------------------------------------------------------- 1,312,229 1,299,510 - ---------------------------------------------------------------------------------------- Operating income 48,997 61,356 Interest expense 19,123 17,626 - ---------------------------------------------------------------------------------------- Income before income taxes 29,874 43,730 Income taxes 13,144 18,387 - ---------------------------------------------------------------------------------------- Net income $ 16,730 $ 25,343 ========== ========== Basic and Diluted Earnings Per Common Share $ 0.12 $ 0.17 ========== ========== Weighted Average Common Shares Outstanding, Basic 141,402 149,297 ========== ========== Weighted Average Common Shares Outstanding, Diluted 143,262 149,592 ========== ========== Operations Analysis: Gross profit %, net sales 34.6% 34.4% Gross profit %, service and rentals 38.0% 38.1% Gross profit %, finance subsidiaries 52.8% 51.3% Total gross profit % 37.3% 37.0% Selling and administrative as a % of revenue 33.7% 32.4% Operating income as a % of revenue 3.6% 4.5% * Excludes $17,000 of insurance proceeds related to the shareholder litigation settlement.
Exhibit 99 IKON Office Solutions, Inc. - --------------------------- FINANCIAL SUMMARY (in thousands, except earnings per share)
Year to Date Fiscal ------------------------------- 2001 2000 % Change ----------- ----------- ---------- Revenues Net sales $ 1,359,790 $ 1,360,570 (0.1)% Service and rentals 1,132,133 1,154,250 (1.9) Finance income 187,354 162,167 15.5 - --------------------------------------------------------------------------------------------------- 2,679,277 2,676,987 0.1 - --------------------------------------------------------------------------------------------------- Costs and Expenses Cost of goods sold 895,612 899,325 Service and rental costs 690,945 699,269 Finance interest expense 90,567 78,960 Selling and administrative 907,511 862,782 Restructuring and asset impairment charge 105,340 - --------------------------------------------------------------------------------------------------- 2,584,635 2,645,676 - --------------------------------------------------------------------------------------------------- Operating income 94,642 31,311 Interest expense 35,877 33,620 - --------------------------------------------------------------------------------------------------- Income (loss) from continuing operations before income taxes 58,765 (2,309) Income taxes 25,856 18,474 - --------------------------------------------------------------------------------------------------- Income (loss) from continuing operations 32,909 (20,783) Discontinued operations, net of income taxes 1,200 - --------------------------------------------------------------------------------------------------- Net income (loss) $ 34,109 $ (20,783) =========== =========== Basic and Diluted Earnings (Loss) Per Common Share Continuing operations $ 0.23 ($ 0.14) Discontinued operations 0.01 =========== =========== Net income (loss) $ 0.24 ($ 0.14) =========== =========== Weighted Average Common Shares Outstanding, Basic 142,087 149,283 =========== =========== Weighted Average Common Shares Outstanding, Diluted 143,005 149,283 =========== =========== Operations Analysis: Gross profit %, net sales 34.1% 33.9% Gross profit %, service and rentals 39.0% 39.4% Gross profit %, finance subsidiaries 51.7% 51.3% Total gross profit % 37.4% 37.3% Selling and administrative as a % of revenue 33.9% 32.2% Operating income as a % of revenue 3.5% 1.2%
Exhibit 99 IKON Office Solutions, Inc. - --------------------------- FINANCIAL SUMMARY (in thousands, except earnings per share) Excluding Special Items
Year to Date Fiscal ----------------------------- 2001 2000 % Change ---------- ---------- ---------- Revenues Net sales $1,359,790 $1,360,570 (0.1)% Service and rentals 1,132,133 1,154,250 (1.9) Finance income 187,354 162,167 15.5 - ---------------------------------------------------------------------------------------- 2,679,277 2,676,987 0.1 - ---------------------------------------------------------------------------------------- Costs and Expenses Cost of goods sold 895,612 899,325 Service and rental costs 690,945 699,269 Finance interest expense 90,567 78,960 Selling and administrative 907,511 879,782 - ---------------------------------------------------------------------------------------- 2,584,635 2,557,336 * - ---------------------------------------------------------------------------------------- Operating income 94,642 119,651 Interest expense 35,877 33,620 - ---------------------------------------------------------------------------------------- Income before income taxes 58,765 86,031 Income taxes 25,856 37,845 - ---------------------------------------------------------------------------------------- Net income $ 32,909 $ 48,186 ========== ========== Basic and Diluted Earnings Per Common Share $ 0.23 $ 0.32 ========== ========== Weighted Average Common Shares Outstanding, Basic 142,087 149,283 ========== ========== Weighted Average Common Shares Outstanding, Diluted 143,005 149,513 ** ========== ========== Operations Analysis: Gross profit %, net sales 34.1% 33.9% Gross profit %, service and rentals 39.0% 39.4% Gross profit %, finance subsidiaries 51.7% 51.3% Total gross profit % 37.4% 37.3% Selling and administrative as a % of revenue 33.9% 32.9% Operating income as a % of revenue 3.5% 4.5% * Excludes $17,000 of insurance proceeds related to the shareholder litigation settlement and $105,340 restructuring and asset impairment charge. ** The exclusion of the special items results in net income; therefore, shares that were previously excluded because of a net loss are now included in the diluted earnings per share calculation.
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