-----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, PdD1HiWEj14DeK/NBUM059X7cl4RW+N8GsfN6w1SPQ7t8wA3NKBdJMMbIamqYeJr ZQKr4zj6+yDaw4HJ7/iV3Q== 0000893220-97-000913.txt : 19970509 0000893220-97-000913.hdr.sgml : 19970509 ACCESSION NUMBER: 0000893220-97-000913 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970330 FILED AS OF DATE: 19970508 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: TELEFLEX INC CENTRAL INDEX KEY: 0000096943 STANDARD INDUSTRIAL CLASSIFICATION: SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841] IRS NUMBER: 231147939 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-05353 FILM NUMBER: 97598000 BUSINESS ADDRESS: STREET 1: 630 W GERMANTOWN PK STE 450 STREET 2: SUITE 450 CITY: PLYMOUTH MEETING STATE: PA ZIP: 19462 BUSINESS PHONE: 2158346301 MAIL ADDRESS: STREET 1: 630 WEST GERMANTOWN PIKE STREET 2: SUITE 450 CITY: PLYMOUTH MEETING STATE: PA ZIP: 19462 10-Q 1 FORM 10-Q FOR TELEFLEX INCORPORATED 1 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 the quarterly period ended March 30, 1997 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 1-5353 TELEFLEX INCORPORATED (Exact Name of Registrant as Specified in its Charter) Delaware 23-1147939 (State of Incorporation) (IRS Employer Identification Number) 630 West Germantown Pike, Suite 450 Plymouth Meeting, PA 19462 (Address of Principal Executive Office) (Zip Code) (610) 834-6301 (Telephone Number Including Area Code) None (Former Name, Former Address and Former Fiscal Year, If Changed Since Last Report) 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 --- --- Indicate the number of shares outstanding of each of the issuer's classes of Common Stock as of the latest practicable date. Class Outstanding at March 30,1997 Common Stock, $1.00 Par Value 18,148,611 2 Teleflex Incorporated Condensed Consolidated Balance Sheet (Dollars in Thousands)
Assets Mar. 30, Dec. 29, 1997 1996 -------- -------- Current assets Cash and cash equivalents $ 67,885 $ 68,618 Accounts receivable less allowance for doubtful accounts 214,435 193,587 Inventories Raw materials 74,835 72,704 Work-in-process 30,950 35,010 Finished goods 86,106 82,982 Prepaid expenses 12,237 13,120 -------- -------- 486,448 466,021 Property, plant and equipment, at cost, less accumulated depreciation 291,010 291,787 Investments in affiliates 23,773 17,356 Intangibles and other assets 89,535 82,690 -------- -------- $890,766 $857,854 ======== ======== Liabilities and shareholders' equity Current liabilities Current portion of borrowings and demand loans $ 68,900 $ 70,587 Accounts payable and accrued expenses 112,686 108,922 Estimated income taxes payable 23,846 17,157 -------- -------- 205,432 196,666 Long-term borrowings 190,042 195,945 Deferred income taxes and other 71,831 56,067 -------- -------- 467,305 448,678 Shareholders' equity 423,461 409,176 -------- -------- $890,766 $857,854 ======== ========
3 Teleflex Incorporated Condensed Consolidated Statement of Income (Dollars and Shares in Thousands, Except Per Share)
Three Months Ended -------------------------------------------- Mar. 30, Mar. 31, 1997 1996 --------------------- ------------------- Revenues $269,344 $234,448 --------------------- ------------------- Cost of sales 186,139 161,110 Operating expenses 54,271 46,588 Interest expense 3,356 3,934 --------------------- ------------------- 243,766 211,632 --------------------- ------------------- Income before taxes 25,578 22,816 Provision for taxes on income 8,901 7,964 --------------------- ------------------- Net income $16,677 $14,852 ===================== =================== Earnings per share $0.90 $0.83 Dividends per share $0.175 $0.155 Average number of common and common equivalent shares outstanding 18,576 17,907
4 Teleflex Incorporated Condensed Consolidated Statement of Cash Flows (Dollars in Thousands)
Three Months Ended --------------------------------------------------- Mar. 30, Mar. 31, 1997 1996 ----------------------- ------------------------- Cash flows from operating activities: Net income $16,677 $14,852 Adjustments to reconcile net income to cash flows from operating activities: Depreciation and amortization 11,337 9,067 (Increase) in accounts receivable (21,311) (13,137) (Increase) decrease in inventory (1,132) 1,380 Decrease in prepaid expenses 707 2,057 Increase (decrease) in accounts payable and accrued expenses 5,498 (4,635) Increase in estimated income taxes payable 6,972 2,611 Gain on sale of businesses and assets (2,055) ----------------------- ------------------------- 18,748 10,140 ----------------------- ------------------------- Cash flows from financing activities: Reduction in long-term borrowings (1,393) (2,369) Increase in current borrowings and demand loans 4,012 5,766 Proceeds from stock compensation plans and distribution of treasury shares 1,010 1,754 Dividends (3,222) (2,721) ----------------------- ------------------------- 407 2,430 ----------------------- ------------------------- Cash flows from investing activities: Expenditures for plant assets (14,794) (7,230) Payments for businesses acquired (349) Proceeds from sale of businesses and assets 32,140 Investments in affiliates (6,650) (160) Other 1,905 1,531 ----------------------- ------------------------- (19,888) 26,281 ----------------------- ------------------------- Net (decrease) increase in cash and cash equivalents (733) 38,851 Cash and cash equivalents at the beginning of the period 68,618 55,654 ----------------------- ------------------------- Cash and cash equivalents at the end of the period $67,885 $94,505 ======================= =========================
5 Teleflex Incorporated Notes to Condensed Consolidated Financial Statements Note 1 The accompanying unaudited condensed consolidated financial statements for the three months ended March 30, 1997 and March 31, 1996 contain all adjustments, consisting only of normal recurring adjustments, which in the opinion of management are necessary to present fairly the financial position, results of operations and cash flows for the periods then ended in accordance with the current requirements for Form 10-Q. Note 2 At March 30, 1997, 1,848,147 shares of common stock were reserved for issuance under the company's stock compensation plans. Note 3 On April 25, 1997, the Board of Directors approved a two-for-one split of the Company's common stock to be effected in the form of a 100% stock dividend to holders of record at the close of business on May 23, 1997. The per share data included in this report has not been adjusted to reflect this prospective stock dividend. Note 4 Business segment information:
Three months ended (000) March 30, 1997 March 31, 1996 Sales Commercial Products $122,740 $111,462 Medical Products 79,568 75,834 Aerospace Products 67,036 47,152 -------- -------- Total $269,344 $234,448 ======== ======== Operating profit Commercial Products $16,107 $15,167 Medical Products 8,588 8,554 Aerospace Products 7,736 6,016 ------- ------- Total $32,431 $29,737 ======= =======
6 Management's Analysis of Quarterly Financial Data Results of Operations: Revenues increased 15% in the first quarter of 1997 to $269.3 million from $234.4 million in 1996. The increase resulted from gains in all three segments, Commercial, Medical and, primarily Aerospace. Nearly one-half of the growth was the result of acquisitions, primarily in the Aerospace Segment, while the remainder resulted from increases in the company's existing product lines. The Commercial, Medical and Aerospace segments comprised 46%, 29% and 25% of the company's net sales, respectively. Gross profit margin decreased to 30.9% in 1997 compared with 31.3% in 1996. A reduction in the proportion of sales from the Medical Segment, which has a higher gross margin compared with the other segments, resulted in the decrease. Operating expenses as a percentage of sales increased slightly to 20.1% in 1997 from 19.9% in 1996 as an increase in the Medical and Commercial segments offset a decline in the Aerospace Segment. Operating profit increased 9% in the first quarter of 1997 from $29.7 million to $32.4 million. Excluding the gain of $2.0 million in the first quarter of 1996 from the disposition of product lines in the Aerospace Segment, operating profit increased 17% and operating margin improved to 12.0% from 11.8%. Operating profit increased in the Aerospace and Commercial segments while the Medical Segment operating profit was unchanged from 1996. An increase in the Aerospace Segment operating margin offset declines in the Commercial and Medical segments. Industry Segment Review: Sales in the Commercial Segment increased 10% from $111.5 million in 1996 to $122.7 million in 1997. The increase resulted from gains in all three product lines: marine, automotive and industrial. The increase was due in part to sales from a small acquisition in the fourth quarter of 1996 within the automotive product line. Operating profit in 1997 of $16.1 million represents a 6% increase compared with 1996; however, operating margin declined from 13.6% to 13.1% due to a decrease in the automotive product line. Additional operating expenses in connection with business expansion efforts and lower margin contribution of the acquisition, resulted in the operating margin decline. 7 The Medical Segment sales increased 5% from $75.8 million to $79.6 million in the first quarter of 1997, compared with 1996 as a result of an increase in the hospital supply product line. Operating profit remained unchanged from the prior year while operating margin declined from 11.3% in 1996 to 10.8% in 1997. Increases in hospital supply operating profit and margin offset declines in surgical devices. The surgical devices product line is in the process of being segregated into market-focused business units, one of which contains the operations of a ligation clip business acquired in the first quarter of 1997. Both the segregation and integration of the acquisition resulted in additional expenses which lowered operating profits and margins in the first quarter. The Aerospace Segment sales increased 42% from $47.2 million in 1996 to $67.0 million in 1997. Sales increased in all product lines in the Segment: cargo handling systems and the turbo-machinery coatings, repairs and component manufacturing businesses. The fourth quarter 1996 addition of an electro-chemical machining company contributed approximately half of the sales growth in the Segment. Excluding the first quarter 1996 gain on the dispositions of two product lines, operating profit increased over 90% and operating margin improved to 11.5% from 8.4%. The increases in both operating profit and margin are due primarily to the higher volume. Cash flow from operations increased $8.6 million during the period ended March 30, 1997 compared with 1996 due to higher net income and depreciation and, the timing of income tax payments. Working capital increased from $269.4 million at December 29, 1996, to $281.0 million at March 30, 1997. The ratio of current assets to current liabilities was 2.4 to 1 at both March 30, 1997 and December 29, 1996. Expenditures for plant assets increased $7.6 million in the first quarter over the same period in 1996. The increase is primarily within the Aerospace Segment where construction of a turbomachinery repairs facility in Singapore is beginning, and where additional equipment is necessary to meet the higher sales volume. Long-term borrowings decreased by $5.9 million from $195.9 million at December 29, 1996, to $190.0 million at March 30, 1997. The decline was due to the effects of lower foreign currency translation rates and, to a lesser extent, repayments. The combination of the decline in long-term borrowings and the increase in shareholders' equity resulted in an improvement in the ratio of long-term borrowings to total capitalization from 32% at December 29, 1996 to 31% at March 30, 1997. 8 Teleflex Incorporated Part II Other Information Item 6. Exhibits and Reports on Form 8-K ----------------------------------------- (A) Reports on form 8-K. No reports on form 8-K were filed during the quarter. 9 Teleflex Incorporated Signatures 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. TELEFLEX INCORPORATED /s/ Harold L. Zuber, Jr. ------------------------ Harold L. Zuber, Jr. (Principal Financial and Accounting Officer) /s/ Steven K. Chance ------------------------ Steven K. Chance (Vice President) May 8, 1997 EX-27 2 FINANCIAL DATA SCHEDULE
5 1000 3-MOS DEC-28-1997 DEC-30-1996 MAR-30-1997 67,885 0 214,435 0 191,891 486,448 291,010 0 890,766 205,432 190,042 0 0 18,149 405,312 890,766 269,344 269,344 186,139 186,139 54,271 0 3,356 25,578 8,901 16,677 0 0 0 16,677 .90 .90
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