-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, pfflWIQ/QJokTfUmLGLx8lkVQ+LJ7utz4V1d6SNtGckNyH3w1JX2b6aMnxmxeUC4 mAbEegdMze5n5/OV6e3TGg== 0000093456-94-000004.txt : 19940823 0000093456-94-000004.hdr.sgml : 19940823 ACCESSION NUMBER: 0000093456-94-000004 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19940703 FILED AS OF DATE: 19940817 FILER: COMPANY DATA: COMPANY CONFORMED NAME: STANDARD REGISTER CO CENTRAL INDEX KEY: 0000093456 STANDARD INDUSTRIAL CLASSIFICATION: 2761 IRS NUMBER: 310455440 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-01097 FILM NUMBER: 94544704 BUSINESS ADDRESS: STREET 1: 600 ALBANY ST CITY: DAYTON STATE: OH ZIP: 45401 BUSINESS PHONE: 5134341000 MAIL ADDRESS: STREET 1: 600 ALBANY STREET STREET 2: P.O. BOX 1167 CITY: DAYTON STATE: OH ZIP: 45401-1167 10-Q 1 THE STANDARD REGISTER COMPANY [TEXT] 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended July 3, 1994 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 01-1097 THE STANDARD REGISTER COMPANY OHIO CORPORATION 31-0455440 600 ALBANY STREET, DAYTON, OHIO 45401 TELEPHONE NUMBER 513-443-1000 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Secu- rities Exchange 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 CLASS OUTSTANDING AS OF July 3, 1994 Common Stock - $1.00 Par Value 23,994,546 Class A Stock - $1.00 Par Value 4,725,000 - 1 of 9 - No Exhibits Filed 2 THE STANDARD REGISTER COMPANY INDEX Page No. PART I - FINANCIAL STATEMENTS Consolidated Balance Sheet July 3, 1994, January 2, 1994 3 Consolidated Statement of Income 26 Weeks Ended July 3, 1994 and July 4, 1993 4 Consolidated Statement of Cash Flows 26 Weeks Ended July 3, 1994 and July 4, 1993 5 The consolidated financial statements of the Registrant included herein have been prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Although certain information normally included in financial statements prepared in accordance with generally accepted accounting principles has been condensed or omitted, the Registrant believes that the disclosures are adequate to make the information presented not misleading. It is suggested that these consolidated financial statements be read in conjunction with the financial statements and notes thereto included in the Annual Report on Form 10-K of the Registrant for the year ended January 2, 1994. The consolidated financial statements included herein reflect all adjustments (consisting only of normal recurring accruals) which, in the opinion of management, are necessary to present a fair statement of the results for the interim periods. The results for interim periods are not necessarily indicative of trends or of results to be expected for a full year. Management's Discussion and Analysis of the Interim Financial Statements 6 PART II - OTHER INFORMATION AND SIGNATURE 8 - 2 - 3 THE STANDARD REGISTER COMPANY CONSOLIDATED BALANCE SHEET (Dollars in Thousands) (Unaudited)
July 3, January 2, 1994 1994 ASSETS CURRENT ASSETS Cash and Cash Equivalents $ 51,784 $ 78,994 Accounts Receivable, less Allowance for Losses 125,506 135,067 Inventories 99,965 98,248 Deferred Income Tax 10,860 10,860 Prepaid Expense 4,288 4,558 Total Current Assets $292,403 $327,727 PLANT AND EQUIPMENT Buildings and Improvements $ 58,452 $ 54,688 Machinery and Equipment 205,095 181,645 Office Equipment 37,461 36,041 Total 301,008 272,374 Less Accumulated Depreciation 130,502 118,411 Depreciated Cost 170,506 153,963 Construction in Process 23,427 17,801 Land 2,675 2,488 Total Plant and Equipment $196,608 $174,252 OTHER ASSETS Patents, Notes, and Other $ 2,605 $ 354 TOTAL ASSETS $491,616 $502,333 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Current Maturities of Long-Term Debt $ 6,471 $ 6,471 Accounts Payable 11,870 20,582 Dividends Payable - 4,874 Accrued Compensation 23,358 27,224 Accrued Retirement Expense 5,761 7,805 Accrued Other Expense (1,801) 1,223 Accrued Taxes, except Income 3,979 4,574 Income Taxes Payable 821 4,761 Deferred Service Contract Income 9,539 6,640 Total Current Liabilities $ 59,998 $ 84,154 LONG-TERM LIABILITIES Long-Term Debt $ 14,306 $ 17,546 Retiree Healthcare 24,482 24,482 Deferred Income Taxes 15,168 15,168 Total Long-Term Liabilities $ 53,956 $ 57,196 SHAREHOLDERS' EQUITY Common Stock, $1.00 Par Value 24,084,632 Shares Issued in 1994 $ 24,085 24,036,796 Shares Issued in 1993 $ 24,037 Class A Stock, $1.00 Par Value 4,725,000 Shares Outstanding 4,725 4,725 Capital in Excess of Stated Value 26,507 25,562 Retained Earnings 324,099 308,413 Treasury Stock, 90,086 Shares at Cost (1,754) (1,754) Total Shareholders' Equity $377,662 $360,983 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $491,616 $502,333 - 3 -
4 THE STANDARD REGISTER COMPANY CONSOLIDATED STATEMENT OF INCOME (In Thousands except Data Per Share) (Unaudited)
Second Quarter Six Months 13 Weeks Ended 26 Weeks Ended July 3, July 4, July 3, July 4, 1994 1993 1994 1993 TOTAL REVENUE $ 184,306 $ 174,728 $ 368,181 $ 344,023 COSTS AND EXPENSES Cost of Products Sold $ 114,806 $ 110,004 $ 231,064 $ 215,077 Engineering & Research 1,868 1,946 3,764 3,864 Selling and Administrative 43,352 40,598 85,737 81,101 Depreciation and Amortization 6,295 6,354 12,606 12,606 Interest 331 294 537 617 Total Costs and Expenses $ 166,652 $ 159,196 $ 333,708 $ 313,265 INCOME BEFORE INCOME TAXES $ 17,654 $ 15,532 $ 34,473 $ 30,758 Income Taxes 7,094 5,986 13,897 11,846 NET INCOME $ 10,560 $ 9,546 $ 20,576 $ 18,912 Average Number of Shares Outstanding (000) 28,713 28,746 28,713 28,746 DATA PER SHARE Net Income Primary and Fully Diluted $ 0.37 $ 0.33 $ 0.72 $ 0.66 Dividends Paid $ 0.17 $ 0.16 $ 0.34 $ 0.32 - 4 -
5 THE STANDARD REGISTER COMPANY CONSOLIDATED STATEMENT OF CASH FLOWS (Dollars in Thousands) (Unaudited)
Six Months 26 Wks Ended July 3, July 4, 1994 1993 CASH FLOWS FROM OPERATING ACTIVITIES Net Income $ 20,576 $ 18,912 Add (Deduct) Items not Affecting Cash: Depreciation and Amortization $ 12,606 $ 12,606 Loss on Sale of Facilities 88 12 Net Change to Post-Retirement Healthcare - 300 Increase (Decrease) in Cash Arising from Changes in Asset and Liabilities: Accounts Receivable 9,560 11,077 Inventories (1,717) (4,063) Other Assets 303 1,356 Accounts Payable (8,713) (7,912) Accrued Expenses (9,528) (11,683) Income Taxes Payable (3,940) ( 1,627) Deferred Service Income 2,899 2,839 Net Adjustments 1,558 2,905 Net Cash Provided by Operating Activities $ 22,134 $ 21,817 CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from Sale of Facilities $ 39 $ 74 Additions to Plant and Equipment (37,371) (11,174) Net Cash (Used in) Investing Activities $(37,332) $(11,100) CASH FLOWS FROM FINANCING ACTIVITIES Principal Payments on Long-Term Debt $ (3,240) $ (3,921) Proceeds from Issuance of Common Stock 993 909 Dividends Paid (9,765) (9,204) Repurchase of Common Stock - (262) Net Cash (Used in) by Financing Activities $(12,012) $(12,478) NET (DECREASE) IN CASH AND CASH EQUIVALENTS $(27,210) $ (1,761) Cash and Cash Equivalents at Beginning of Year $ 78,994 $ 86,203 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 51,784 $ 84,442 - 5 -
6 THE STANDARD REGISTER COMPANY MANAGEMENT DISCUSSION AND ANALYSIS OF THE INTERIM FINANCIAL STATEMENTS Net income for the second quarter 1994 was $10.6 million, a 10.6% increase compared to the second quarter 1993 result of $9.5 million; earnings per share were $.37 vs. $.33 a year earlier. For the six months year-to-date period, net income was $20.6 million or $.72 per share, an 8.8% increase compared to 1993's $18.9 million and $.66 per share result. Total revenue increased 5.5% and 7.0% for the quarter and year-to-date periods, respectively. Business forms shipments rose 4.8% and 7.3% for the respective reporting periods as the growth of pressure sensitive, Stanfast, Imprint, cut sheet, and forms management services overcame the continuing weakness in traditional custom continuous, stock, and unit set form categories. The 4.8% second quarter increase in business forms was a result of both higher unit shipment levels and an average 3.0% increase in net selling prices. Promotional direct mail shipments were off 2.3% in the quarter and were up a modest 1.7% for the six month period, reflecting an increasingly price competitive marketplace. Following a flat first quarter performance, equipment, supplies, and related maintenance services rose a healthy 17.5% for the quarter on the strength of continued expansion in third party maintenance services. 1994 pretax profit margins as a percent of revenue have improved vs. 1993 for both the quarter and year-to-date periods--from 8.9% to 9.6% in the quarter and 8.9% to 9.4% for the first half. For the second quarter this is attributed to improved gross margins driven by higher average pricing and improved manufacturing cost ratios. The favorable year-to-date comparison reflects a favorable spread between the growth rates of revenue and operating expenses. Paper costs, which represent approximately half the manufacturing cost of a typical business form, began to rise in June after eight months of weakness. By September, weighted average purchase prices for all material categories are expected to increase 12%. The company has announced a 5% price increase for the majority of its forms products effective August 1. The most recent general price increase for business forms was in July 1993 and the company expects to recover the August 1 forms price increase over the near term. The effective income tax rate was 40.2% for the second quarter 1994 vs. 38.6 for the 1993 quarter; the year-to-date comparisons show an almost identical disparity. The increased rates reflect higher state and local tax rates and the 1% rise in the federal tax rate that was adopted with a retroactive adjustment in the fourth quarter 1993. The total year effective tax rate for 1994 is expected to be similar to last year's 40.0%. - 6 - 7 The acquisition by the company of the Promotional Graphics Division of Uarco became effective June 30, 1994. This division, which markets promotional direct mail produced by its Eudora , Kansas plant, has been consolidated with Standard's COMMUNICOLOR Division. The acquisition provides the company with needed promotional printing capacity, a western manufacturing operation, an expanded product offering, experienced personnel, and a customer base that is expected initially to add approximately $20 million to annual revenues. Net cash flow for the first half 1994 was a negative $27.2 million vs. an outflow of $1.8 million for the same period of 1993. The $25.4 million greater outflow in 1994 resulted primarily from the acquisition of Promotional Graphics plus increased capital spending. 1994's capital spending includes projects to expand production capacity for growth products and the continuing development of internal systems to improve customer service and operating effectiveness. 1994 annual capital expenditures are expected to total approximately $55 million, including the Promotional Graphics acquisition. Cash flow from operations and financing activities was little changed from last year's first half result. At quarter-end, cash and equivalents stood at $51.8 million. Total debt, including current maturities, was $20.8 million, producing a net cash position of $31.0 million. Current assets were 4.9 times the level of current liabilities. The company believes that a combination of internally generated funds and current cash reserves will be adequate to meet operating and financing needs for the near term. - 7 - 8 THE STANDARD REGISTER COMPANY PART II - OTHER INFORMATION ITEMS 1 THRU 3 None ITEM 4. Submission of Matters to a Vote of Security Holders The Company's Annual Meeting of Shareholders was held on April 20, 1994. Following is the result of voting by the Shareholders regarding fixing and determining the number of Directors to be ten. IN FAVOR OPPOSED ABSTAINED 45,089,752 11,708 63,668 As a result of voting of the Shareholders, the following members were elected to the Company's Board of Directors to hold office for the ensuing year: NOMINEE IN FAVOR WITHHELD Roy W. Begley, Jr. 45,110,794 54,334 Ralph R. Burchenal 45,131,482 33,646 F. David Clarke, III 45,130,126 35,002 John K. Darragh 45,130,885 34,243 Paul H. Granzow 45,116,931 48,197 Mary C. Nushawg 45,113,517 51,611 Peter S. Redding 45,130,668 34,460 John J. Schiff, Jr. 45,131,843 33,285 Charles F. Sherman 45,114,199 50,929 John Q. Sherman, II 45,115,448 49,680 Following is a result of voting by the Shareholders regarding selection of Battelle & Battelle as the Corporation's Auditors for the year 1994. IN FAVOR OPPOSED ABSTAINED 45,092,731 31,547 40,850 No broker non-votes were recorded. ITEMS 5 THRU 6 NONE - 8 - 9 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. August 12, 1994 THE STANDARD REGISTER COMPANY /s/ C. J. Brown By C. J. Brown, Vice President- Finance, Treasurer & Chief Financial Officer (principal financial officer) - 9 - -----END PRIVACY-ENHANCED MESSAGE-----