8-K 1 form8kq12008earnings.txt FORM 8-K Q1 2008 EARNINGS UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES ACT OF 1934 Date of Report (Date of earliest event reported) January 18, 2008 ------------------------------------------------------------------- AMCON DISTRIBUTING COMPANY -------------------------- (Exact name of registrant as specified in its charter) DELAWARE 1-15589 47-0702918 ------------------------------------------------------------------------------ (State or other (Commission (IRS Employer jurisdiction of File Number) Identification No.) incorporation) 7405 Irvington Road, Omaha, NE 68122 ------------------------------------ (Address of principal executive offices) (Zip Code) (402) 331-3727 -------------- (Registrant's telephone number, including area code) Not Applicable -------------- (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: Written communications pursuant to Rule 425 under the Securities Act (17 ---- CFR 230.425) Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR ---- 240.14a-12) Pre-commencement communications pursuant to Rule 14d-2(b) under the ---- Exchange Act (17 CFR 240.14d-2(b)) Pre-commencement communications pursuant to Rule 13e-4(c) under the ---- Exchange Act (17 CFO 240.13e-4(c)) Item 2.02 Results of Operations and Financial Condition. On January 18, 2008, AMCON Distributing Company ("AMCON or "Company") issued a press release announcing its financial results for the first fiscal quarter ended December 31, 2007. A copy of the press release is attached to this report as an exhibit and is incorporated herein by reference. The information in this report (including the exhibit) shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information set forth in this report (including the exhibit) shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing. ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS EXHIBIT NO. DESCRIPTION 99.1 Press release, dated January 18, 2008, issued by AMCON Distributing Company announcing financial results for the first fiscal quarter ended December 31, 2007 SIGNATURE Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. AMCON DISTRIBUTING COMPANY (Registrant) Date: January 18, 2008 By: Andrew C. Plummer ------------------------- Name: Andrew C. Plummer Title: Vice President & Chief Financial Officer EXHIBIT INDEX ------------- Exhibit Description 99.1 Press release, dated January 18, 2008, issued by AMCON Distributing Company announcing financial results for the first fiscal quarter ended December 31, 2007 Exhibit 99.1 AMCON DISTRIBUTING COMPANY REPORTS FULLY DILUTED EARNINGS PER SHARE OF $1.12 FOR THE FIRST FISCAL QUARTER ENDED DECEMBER 31, 2007 NEWS RELEASE Chicago, IL, January 18, 2008 - AMCON Distributing Company ("AMCON") (AMEX:DIT), an Omaha, Nebraska based consumer products company is pleased to announce diluted earnings per share of $1.12 for the first fiscal quarter ended December 31, 2007. "We continue to make steady progress on our strategic plan," commented Christopher H. Atayan, AMCON's Chief Executive Officer. Atayan added "Both of our business segments performed well this quarter. We have a highly cohesive organization that is focused on delivering superior service to our wholesale and retail customers. Our focus on fundamentals leads directly to value creation for our shareholders. Moreover, this philosophy positions us well in a period of economic volatility." For the first fiscal quarter of 2008, AMCON's Wholesale Distribution segment generated revenues of $201.1 million and operating income before depreciation and amortization of $3.0 million. AMCON's Retail Health Food segment generated revenues of $9.5 million and operating income before depreciation and amortization of $0.9 million. "Our Customer First philosophy led to several new business awards during the quarter and we continue to manage the business as efficiently as possible," commented Kathleen Evans, President of AMCON's Wholesale Distribution Segment. "We continue to offer our consumers a wide variety of quality products and strong customer service, which we believe continues to differentiate us from our competitors," commented Eric Hinkefent, President of AMCON's Retail Health Food segment. "Income from continuing operations for the first fiscal quarter of 2008 was $1.0 million as compared to $0.6 million in the comparable prior period on lower operating and interest costs. Our fully diluted results from the prior period also included a gain of $0.9 million in connection with the sale of the assets of Hawaiian Natural Water Company" commented Andrew Plummer, AMCON's Chief Financial Officer. Plummer added, "We continue to maintain a high degree of liquidity, which facilitates our ability to take advantage of opportunities that benefit our customers." AMCON is a leading wholesale distributor of consumer products, including beverages, candy, tobacco, groceries, food service, frozen and chilled foods, and health and beauty care products with distribution centers in Illinois, Missouri, Nebraska, North Dakota and South Dakota. Chamberlin's Natural Foods, Inc. and Health Food Associates, Inc., both wholly-owned subsidiaries of The Healthy Edge, Inc., operate health and natural product retail stores in central Florida (6), Kansas, Missouri, Nebraska and Oklahoma (4). The retail stores operate under the names Chamberlin's Market & Cafe and Akins Natural Foods Market. This news release contains forward-looking statements that are subject to risks and uncertainties and which reflect management's current beliefs and estimates of future economic circumstances, industry conditions, Company performance and financial results. A number of factors could affect the future results of the Company and could cause those results to differ materially from those expressed in the Company's forward-looking statements including, without limitation, availability of sufficient cash resources to conduct its business and meet its capital expenditures needs. Moreover, past financial performance should not be considered a reliable indicator of future performance. Accordingly, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 with respect to all such forward-looking statements. Visit AMCON Distributing Company's web site at: www.amcon.com For Further Information Contact: Christopher H. Atayan AMCON Distributing Company Ph 312-327-1770 Fax: 312-527-3964
AMCON Distributing Company and Subsidiaries Condensed Consolidated Balance Sheets December 31, 2007 and September 30, 2007 ---------------------------------------------------------------------------------------------------- December 2007 September (Unaudited) 2007 ------------ ------------ ASSETS Current assets: Cash $ 300,908 $ 717,554 Accounts receivable, less allowance for doubtful accounts of $0.3 million and $0.3 million, respectively 24,564,218 27,848,938 Inventories, net 34,057,251 29,738,727 Deferred income taxes 1,290,020 1,446,389 Current assets of discontinued operations 13,743 18,897 Prepaid and other current assets 5,176,195 5,935,208 ------------ ------------ Total current assets 65,402,335 65,705,713 Property and equipment, net 11,157,673 11,190,768 Goodwill 5,848,808 5,848,808 Other intangible assets, net 3,390,137 3,400,070 Deferred income taxes 2,270,436 2,768,043 Non-current assets of discontinued operations 2,057,033 2,057,033 Other assets 1,531,789 1,093,150 ------------ ------------ $ 91,658,211 $ 92,063,585 ============ ============ LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 12,872,541 $ 15,253,562 Accrued expenses 4,954,751 5,293,923 Accrued wages, salaries and bonuses 1,244,147 2,202,594 Income taxes payable 194,201 367,773 Current liabilities of discontinued operations 4,031,778 4,035,863 Current maturities of credit facility 3,046,000 3,046,000 Current maturities of long-term debt 623,278 568,024 ------------ ------------ Total current liabilities 26,966,696 30,767,739 Credit facility, less current maturities 38,331,796 35,808,180 Long-term debt, less current maturities 6,989,239 7,123,453 Noncurrent liabilities of discontinued operations 6,542,310 6,542,310 Series A cumulative, convertible preferred stock, $.01 par value 100,000 shares authorized and issued, liquidation preference $25.00 per share 2,438,355 2,438,355 Series B cumulative, convertible preferred stock, $.01 par value 80,000 shares authorized and issued, liquidation preference $25.00 per share 1,857,645 1,857,645 Series C cumulative, convertible preferred stock, $.01 par value 80,000 shares authorized and issued, liquidation preference $25.00 per share 1,982,372 1,982,372 Commitments and contingencies Shareholders' equity: Preferred stock, $0.01 par, 1,000,000 shares authorized, 260,000 shares outstanding and issued in Series A, B and C referred to above - - Common stock, $.01 par value, 3,000,000 shares authorized, 537,064 shares outstanding for December 2007 and 529,436 shares outstanding for September 2007 5,372 5,295 Additional paid-in capital 6,558,641 6,396,131 Accumulated deficit (14,215) (857,895) ------------ ------------ Total shareholders' equity 6,549,798 5,543,531 ------------ ------------ $ 91,658,211 $ 92,063,585 ============ ============
AMCON Distributing Company and Subsidiaries Condensed Consolidated Unaudited Statements of Operations for the three months ended December 31, 2007 and 2006 --------------------------------------------------------------------------------------------------------- 2007 2006 As restated/1/ ------------- ------------- Sales (including excise taxes of $51.6 million and $49.5 million, respectively) $ 210,663,237 $ 209,366,149 Cost of sales 195,467,389 194,271,875 ------------- ------------- Gross profit 15,195,848 15,094,274 ------------- ------------- Selling, general and administrative expenses 12,210,575 12,405,083 Depreciation and amortization 362,474 457,843 ------------- ------------- 12,573,049 12,862,926 ------------- ------------- Operating income 2,622,799 2,231,348 ------------- ------------- Other expense (income): Interest expense 969,802 1,268,662 Other (income), net (33,211) (31,081) ------------- ------------- 936,591 1,237,581 ------------- ------------- Income from continuing operations before income taxes 1,686,208 993,767 Income tax expense 641,000 383,000 ------------- ------------- Income from continuing operations 1,045,208 610,767 ------------- ------------- Discontinued operations Gain on disposal of discontinued operations, net of income tax expense of $0.7 million - 895,588 (Loss) from discontinued operations, net of income tax (benefit) of ($0.06) million and ($0.2) million, respectively (95,995) (258,047) ------------- ------------- (Loss) income on discontinued operations (95,995) 637,541 ------------- ------------- Net income 949,213 1,248,308 Preferred stock dividend requirements (105,533) (105,533) ------------- ------------- Net income available to common shareholders $ 843,680 $ 1,142,775 ============= ============= Basic earnings (loss) per share available to common shareholders: Continuing operations $ 1.76 $ 0.96 Discontinued operations (0.18) 1.21 ------------- ------------- Net basic earnings per share available to common shareholders $ 1.58 $ 2.17 ============= ============= Diluted earnings (loss) per share available to common shareholders: Continuing operations $ 1.23 $ 0.71 Discontinued operations (0.11) 0.75 ------------- ------------- Net diluted earnings per share available to common shareholders $ 1.12 $ 1.46 ============= ============= Weighted average shares outstanding: Basic 533,900 527,062 Diluted 849,187 854,427
AMCON Distributing Company and Subsidiaries Condensed Consolidated Unaudited Statements of Cash Flows for the three months ended December 31, 2007 and 2006 ---------------------------------------------------------------------------------------------------- 2007 2006 As restated/1/ ------------ ------------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 949,213 $ 1,248,308 Deduct: (Loss) income from discontinued operations, net of tax (95,995) 637,541 ------------ ------------ Income from continuing operations 1,045,208 610,767 Adjustments to reconcile net income from continuing operations to net cash flows from operating activities: Depreciation 352,541 447,909 Amortization 9,933 9,934 (Gain) on sale of property and equipment (1,625) (11,116) Stock based compensation 42,950 3,000 Deferred income taxes 653,976 899,251 Provision (benefit) for losses on doubtful accounts 44,000 (76,196) Provision for losses on inventory obsolescence 160,885 172,503 Changes in assets and liabilities: Accounts receivable 3,240,720 (315,381) Inventories (4,479,409) (2,074,042) Other current assets 759,013 314,707 Other assets (438,639) (66,286) Accounts payable (2,381,021) (802,790) Accrued expenses and accrued wages, salaries and bonuses (1,297,619) (721,203) Income tax payable and receivable (173,572) (98,949) ------------ ------------ Net cash flows from operating activities - continuing operations (2,462,659) (1,707,892) Net cash flows from operating activities - discontinued operations (94,926) (1,808,062) ------------ ------------ Net cash flows from operating activities (2,557,585) (3,515,954) CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment (280,619) (170,809) Proceeds from sales of property and equipment 888 14,200 ------------ ------------ Net cash flows from investing activities - continuing operations (279,731) (156,609) Net cash flows from investing activities - discontinued operations - 3,753,394 ------------ ------------ Net cash flows from investing activities (279,731) 3,596,785 CASH FLOWS FROM FINANCING ACTIVITIES: Net borrowings on bank credit agreements 2,523,616 733,644 Dividends paid on preferred stock (105,533) (105,533) Proceeds from exercise of stock options 119,637 - Principal payments on long-term debt (117,050) (161,467) ------------ ------------ Net cash flows from financing activities - continuing operations 2,420,670 466,644 Net cash flows from financing activities - discontinued operations - (595,048) ------------ ------------ Net cash flows from financing activities 2,420,670 (128,404) ------------ ------------ Net change in cash (416,646) (47,573) Cash, beginning of period 717,554 481,138 ------------ ------------ Cash, end of period $ 300,908 $ 433,565 ============ ============ Supplemental disclosure of cash flow information: Cash paid during the period for interest $ 992,518 $ 1,262,202 Cash paid during the period for income taxes 101,595 98,949 Supplemental disclosure of non-cash information: Buyer's assumption of HNWC lease in connection with the sale of HNWC's assets - discontinued operations - (225,502) Acquisition of equipment through capital leases 38,090 - /1/ As previously disclosed in the Company's Fiscal 2007 Annual Report on Form 10-K, during the fourth quarter of fiscal 2007, the Company changed its inventory valuation method from the Last-In First-Out (LIFO) method to the First-In First-Out (FIFO) method. As required by U.S. generally accepted accounting principles, this change in accounting principle was reflected in the Company's financials statements through the retroactive application of the FIFO method and the restatement of prior fiscal periods, including the three month fiscal period ended December 2006.