0000093456-95-000003.txt : 19950816
0000093456-95-000003.hdr.sgml : 19950816
ACCESSION NUMBER: 0000093456-95-000003
CONFORMED SUBMISSION TYPE: 10-Q
PUBLIC DOCUMENT COUNT: 2
CONFORMED PERIOD OF REPORT: 19950702
FILED AS OF DATE: 19950815
SROS: NASD
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: STANDARD REGISTER CO
CENTRAL INDEX KEY: 0000093456
STANDARD INDUSTRIAL CLASSIFICATION: MANIFOLD BUSINESS FORMS [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: 95564262
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
1
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 Quarter Ended July 2, 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 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
Securities 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 2, 1995
Common Stock - $1.00 Par Value 23,940,017
Class A Stock - $1.00 Par Value 4,725,000
- 1 of 10 -
2
THE STANDARD REGISTER COMPANY
INDEX
Page
No.
PART I - FINANCIAL STATEMENTS
Consolidated Balance Sheet
July 2, 1995, January 1, 1995 3
Consolidated Statement of Income
13 Weeks Ended July 2, 1995 and July 3, 1994 4
26 Weeks Ended July 2, 1995 and July 3, 1994
Consolidated Statement of Cash Flows
26 Weeks Ended July 2, 1995 and July 3, 1994 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 1, 1995.
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
Financial Condition and Results of Operations 6-7
PART II - OTHER INFORMATION AND SIGNATURE 8-10
- 2 -
3
THE STANDARD REGISTER COMPANY
CONSOLIDATED BALANCE SHEET
(Dollars in Thousands)
(Unaudited)
July 2, January 1,
1995 1995
ASSETS
CURRENT ASSETS
Cash and Cash Equivalents $ 32,583 $ 55,235
Accounts Receivable, less Allowance
for Losses 153,360 151,952
Inventories 117,780 100,673
Deferred Income Tax 9,592 9,592
Prepaid Expense 5,548 4,039
Total Current Assets $318,863 $321,491
PLANT AND EQUIPMENT
Buildings and Improvements $ 59,608 $ 57,472
Machinery and Equipment 208,343 193,187
Office Equipment 37,231 37,904
Total 305,182 288,563
Less Accumulated Depreciation 135,140 121,267
Depreciated Cost 170,042 167,296
Construction in Process 35,808 28,720
Land 3,318 2,789
Total Plant and Equipment $209,168 $198,805
OTHER ASSETS
Goodwill, Patents, and Other 2,969 2,391
Investment in Polyforms Joint Venture 4,218 2,972
Total Other Assets $ 7,187 $ 5,363
TOTAL ASSETS $535,218 $525,659
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Current Maturities of Long-Term Debt $ 6,471 $ 6,471
Accounts Payable 16,689 19,071
Dividends Payable - 5,149
Accrued Compensation 24,942 27,994
Accrued Retirement Expense 6,146 4,139
Accrued Other Expense 207 2,230
Accrued Taxes, except Income 4,250 5,181
Income Taxes Payable 74 2,278
Customer Deposits 15,040 9,807
Deferred Service Contract Income 9,897 7,360
Total Current Liabilities $ 83,716 $ 89,680
LONG-TERM LIABILITIES
Long-Term Debt $ 7,835 $ 11,071
Retiree Healthcare 25,232 25,125
Deferred Income Taxes 15,817 15,817
Total Long-Term Liabilities $ 48,884 $ 52,013
SHAREHOLDERS' EQUITY
Common Stock, $1.00 Par Value
24,141,758 Shares Issued in 1995 $ 24,142
24,084,632 Shares Issued in 1994 $ 24,085
Class A Stock, $1.00 Par Value
4,725,000 Shares Outstanding 4,725 4,725
Capital in Excess of Stated Value 27,450 26,507
Retained Earnings 350,153 332,501
Treasury Stock, 201,741 Shares at Cost (3,852) (3,852)
Total Shareholders' Equity $402,618 $383,966
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY $535,218 $525,659
- 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 2, July 3, July 2, July 3,
1995 1994 1995 1994
TOTAL REVENUE $ 222,523 $ 184,306 $ 427,022 $ 368,181
COSTS AND EXPENSES
Cost of Products Sold $ 145,433 $ 114,806 $ 275,423 $ 231,064
Engineering & Research 1,912 1,868 3,924 3,764
Selling and Administrative 47,158 43,352 93,963 85,737
Depreciation and Amortization 7,543 6,295 14,918 12,606
Interest 263 331 540 537
Total Costs and Expenses $ 202,309 $ 166,652 $ 388,768 $ 333,708
INCOME BEFORE INCOME TAXES $ 20,214 $ 17,654 $ 38,254 $ 34,473
Income Taxes 8,173 7,094 15,432 13,897
NET INCOME $ 12,041 $ 10,560 $ 22,822 $ 20,576
Average Number of Shares
Outstanding (000) 28,657 28,713 28,657 28,713
DATA PER SHARE
Net Income Primary and
Fully Diluted $ 0.42 $ 0.37 $ 0.80 $ 0.72
Dividends Paid $ 0.18 $ 0.17 $ 0.36 $ 0.34
- 4 -
5
THE STANDARD REGISTER COMPANY
CONSOLIDATED STATEMENT OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
Six Months
26 Wks Ended
July 2, July 3,
1995 1994
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $ 22,822 $ 20,576
Add Items not Affecting Cash:
Depreciation and Amortization $ 14,918 $ 12,606
Loss on Sale of Facilities 52 88
Net Change to Post-Retirement Healthcare 106 -
Increase (Decrease) in Cash Arising from
Changes in Asset and Liabilities:
Accounts Receivable (1,408) 9,560
Inventories (17,107) (1,717)
Other Assets (2,167) 303
Accounts Payable (2,381) (8,713)
Accrued Expenses (3,998) (9,528)
Income Taxes Payable (2,204) (3,940)
Customer Deposits 5,231 -
Deferred Service Income 2,537 2,899
Net Adjustments (6,421) 1,558
Net Cash Provided by Operating Activities $ 16,401 $ 22,134
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from Sale of Facilities $ 71 $ 39
Additions to Plant and Equipment (25,324) (37,371)
Investment in Polyforms Joint Venture (1,246) -
Net Cash Used in Investing Activities $(26,499) $(37,332)
CASH FLOWS FROM FINANCING ACTIVITIES
Principal Payments on Long-Term Debt $ (3,235) $ (3,240)
Proceeds from Issuance of Common Stock 1,000 993
Dividends Paid (10,319) (9,765)
Net Cash Used in Financing Activities $(12,554) $(12,012)
NET DECREASE IN CASH AND
CASH EQUIVALENTS $(22,652) $(27,210)
Cash and Cash Equivalents, Beginning $ 55,235 $ 78,994
CASH AND CASH EQUIVALENTS, ENDING $ 32,583 $ 51,784
- 5 -
6
THE STANDARD REGISTER COMPANY
MANAGEMENT DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Net income for the second quarter 1995 was $12.0 million, a 14.0%
increase compared to the $10.6 million result for the comparable
quarter of 1994; earnings per share were $.42 vs. $.37 a year earlier.
For the six months year-to-date period, net income was $22.8 million or
$.80 per share, a 10.9% increase compared to 1994's $20.6 million and
$.72 per share result.
Total revenue increased 20.7% and 16.0% for the quarter and year-to-
date periods, respectively. Business forms products, representing 76%
of all revenue, increased 18.7% and 13.4% for the respective reporting
periods. The 18.7% second quarter increase in business forms was a
result of higher unit shipment levels and an average 17.6% increase in
net selling prices due to rising paper prices. Revenue from
promotional direct mail, representing 13% of all revenue, was up 62.5%
and 48.7% for the quarter and year-to-date periods, respectively, in
major part as a result of the mid-year 1994 acquisition of the
Promotional Graphics Division of UARCO. Equipment and related
maintenance services and supplies decreased .5% for the quarter which
lowered the year-to-date revenue increase for these products and
services to 5.2%.
The Company experienced paper price increases in the second quarter of
1995, continuing the sharp rise in paper prices begun in June, 1994.
During the quarter the Company raised forms prices in order to recover
the higher paper costs. The Company has historically been successful
in realizing the majority of its forms price increases.
As a result of higher paper prices, the Company continues to expect an
unfavorable LIFO charge to pretax earnings in 1995. The second quarter
pretax LIFO charge was $5.0 million or $.11 per share after tax which
increased the year-to-date pre-tax LIFO charge to $7.5 million or $.16
per share after tax. Additional LIFO adjustments are expected for the
balance of 1995.
Excluding the effects of LIFO, gross margin (revenue less cost of
products sold) increased $12.6 million and $22.0 million for the
quarter and year-to-date periods, respectively. Gross margin as
percentage of revenue was down only .8% for the quarter, 36.9% versus a
prior year of 37.7%, and improved a modest .1% on a year-to-date basis,
37.3% versus a prior year of 37.2%, reflecting the Company's generally
successful efforts to recover increased paper costs.
The total of selling, administrative, and R&D expenses increased 8.5%
and 9.4% for the quarter and year-to-date periods, below the comparable
20.7% and 16.0% rates of revenue growth. Depreciation
- 6 -
7
expense rose 18% year-to-date, reflecting higher capital spending and
the effects of the Promotional Graphics and the FCA Division of Capital
Graphics, Inc. acquisitions. Despite a $6.5 million lower average debt
balance in 1995, interest expense through six months was approximately
equal to the comparable period of 1994 as a result of higher interest
rates.
Net cash flow for the first half 1995 was a negative $22.7 million,
resulting primarily from the FCA acquitision and increased working
capital due to higher paper costs. 1995 capital expenditures are
forecasted at $44 million dollars, including acquisition of the FCA and
the recently announced $3.5 million equity investment in F3 Software
Corporation. The F3 Software Corporation develops and markets forms
design and forms automation software, a key building block for the
Company's electronic products offering to customers.
At quarter-end, cash and cash equivalents stood at $32.6 million.
Total debt, including current maturities, was $14.3 million, producing
a net cash position of $18.3 million. Current assets were 3.8 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 5
None
ITEM 6 -
(a) Exhibits
Exhibit No. Description
27 Financial Data Schedule
(b) There have been no reports on Form 8-K filed during the
quarter for which this report on Form 10-Q is being filed.
- 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 7, 1995
THE STANDARD REGISTER COMPANY
/s/ C. J. Brown
By C. J. Brown, Senior Vice President-
Administration, Treasurer
& Chief Financial Officer
- 9 -
10
EXHIBIT INDEX
Number Description
27 Financial Data Schedule
- 10 -
EX-27
2
5
1,000
6-MOS
Dec-31-1995
Jul-02-1995
32,583
0
157,339
5,164
117,780
318,863
209,168
135,140
535,218
83,716
14,306
28,867
0
0
373,751
535,218
426,146
427,022
275,423
388,768
0
1,738
540
38,254
15,432
22,822
0
0
0
22,822
0.80
0.80