-----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, VZlfVEMBBS0UEzKOaE3LcHwZ3OIKWsxl7j5315mok72/7UXrKkatYzGX5Vv+8EQt 8CssurzIlrvkMPk5RpA3dQ== 0000098559-94-000032.txt : 19941018 0000098559-94-000032.hdr.sgml : 19941018 ACCESSION NUMBER: 0000098559-94-000032 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19940831 FILED AS OF DATE: 19941017 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: TOKHEIM CORP CENTRAL INDEX KEY: 0000098559 STANDARD INDUSTRIAL CLASSIFICATION: 3580 IRS NUMBER: 350712500 STATE OF INCORPORATION: IN FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-06018 FILM NUMBER: 94552945 BUSINESS ADDRESS: STREET 1: P O BOX 360 CITY: FORT WAYNE STATE: IN ZIP: 46801-0360 BUSINESS PHONE: 2194232552 10-Q 1 October 14, 1994 Securities & Exchange Commission Division of Corporate Finance 500 North Capitol Street Washington, D.C. 20549 Gentlemen: Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934, enclosed is Tokheim's Form 10-Q for the period ended August 31, 1994. Sincerely, TOKHEIM CORPORATION Jess B. Ford Vice President, Finance Secretary, and Chief Financial Officer Enclosure pc: New York Stock Exchange Division of Stock List - 2 Fred Axley - McDermott, Will & Emery Louis Pach - Coopers & Lybrand FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 (Mark One) (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended AUGUST 31, 1994 -------------------- ( ) 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 1-6018 ------ TOKHEIM CORPORATION -------------------------------------------------------- (Exact name of registrant as specified in its charter) INDIANA 35-0712500 - ------------------------------------ ---------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 10501 CORPORATE DR., FORT WAYNE, IN 46845 - ------------------------------------------- ------------------ (Address of principal executive offices) (Zip Code) (Registrant's telephone number including area code) (219) 470-4600 --------------- NOT APPLICABLE - -------------------------------------------------------------------- (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 --- --- As of August 31, 1994, 7,833,483 shares of voting common stock were outstanding. In addition, 828,442 shares of convertible preferred stock were held by the Retirement Savings Plan for Employees of Tokheim Corporation and Subsidiaries. The exhibit index is located on page 7. 1 PART I. FINANCIAL INFORMATION TOKHEIM CORPORATION ITEM 1. FINANCIAL STATEMENTS CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS (AMOUNTS IN THOUSANDS EXCEPT AMOUNTS PER SHARE) Three Months Ended Nine Months Ended ------------------------------------------------ August 31, August 31, August 31, August 31, 1994 1993 1994 1993 ---------------------- ----------------------- NET SALES........................................ $ 47,931 $41,386 $143,075 $118,014 Cost of sales, exclusive of items listed below... 37,610 32,840 109,369 92,691 Selling, general, and administrative expenses.... 9,778 8,187 27,781 25,814 Depreciation and amortization.................... 1,129 1,290 3,470 4,013 Interest expense (net of interest income of $53 and $192 in 1994 and $93 and $256 in 1993 for the three-month and nine-month periods, respectively).................................. 609 709 1,890 2,183 Foreign currency gains (losses).................. 95 (143) 148 (555) Other income (expense), net ..................... (158) 113 (405) (413) Loss before income taxes and cumulative effect of change in method of accounting for postretirement benefits other than pensions.... (1,258) (1,670) 308 (7,655) Income taxes..................................... 215 268 475 600 Loss before cumulative effect of change in method of accounting for post- retirement benefits other than pensions........ (1,473) (1,938) (167) (8,255) Cumulative effect of change in method of accounting for postretirement benefits other than pensions.................................. -- -- (13,416) -- NET LOSS ........................................ $ (1,473) $(1,938) $(13,583) $(8,255) Preferred stock dividends........................ $ 401 $ 414 $ 1,215 $ 1,252 Net loss applicable to common stock.............. $ (1,874) $(2,352) $(14,798) $(9,507) Loss per common share: Primary: Before cumulative effect of change in method of accounting for postretirement benefits other than pensions............... $ (0.24) $ (0.33) $ (0.18) $ (1.42) Cumulative effect of change in method of accounting for postretirement benefits other than pensions........................ -- -- (1.72) -- Net loss..................................... $ (0.24) $ (0.33) $ (1.90) $ (1.42) Weighted average shares outstanding.......... 7,823 7,140 7,790 6,708
2 NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS In the opinion of the Company, the accompanying unaudited consolidated condensed financial statements contain all adjustments (consisting of only normal recurring items) necessary to present fairly its financial position as of August 31, 1994, and the results of operations and cash flows for the three-month periods and nine-month periods ended August 31, 1994 and 1993. Amounts for interim periods are unaudited. Amounts for the year ended November 30, 1993, were derived from audited financial statements included in the 1993 Annual Report to Stockholders. Certain prior year amounts in these financial statements have been reclassified to conform with current year presentation. Effective December 1, 1993, the Company adopted Statement of Financial Accounting Standards No. 106, "Employers' Accounting for Postretirement Benefits Other Than Pensions," which requires that certain postretirement medical and life insurance benefits be accounted for on an accrual basis. The domestic portion of notes payable, banks has been classified as a long-term liability, reflecting the three-year term of the underlying financing agreement. Fully diluted loss per share is considered to be the same as primary loss per share, since the effect of certain potentially dilutive securities would be antidilutive. See financial statements and accompanying notes in the Company's 1993 Annual Report. 3 CONSOLIDATED CONDENSED BALANCE SHEET (IN THOUSANDS) August 31, November 30, 1994 1993 ------------- -------------- ASSETS Current assets: Cash and cash equivalents.................... $ 3,315 $ 9,097 Receivables, net............................. 31,014 36,644 Inventories: Raw materials and supplies................ 9,844 6,295 Work in process........................... 25,457 22,864 Finished goods............................ 7,292 8,644 42,593 37,803 Less amount necessary to reduce certain inventories to LIFO method.............. 2,995 2,932 39,598 34,871 Prepaid expenses............................. 2,470 2,527 Total current assets......................... 76,397 83,139 Property, plant, and equipment, net.......... 27,432 29,004 Other assets and deferred charges............ 5,437 4,922 Total assets................................. $109,266 $117,065 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current maturities of long-term debt......... $ 1,070 $ 1,237 Notes payable, banks......................... 2,005 18,684 Accounts payable............................. 14,356 19,333 Accrued expenses............................. 15,886 14,471 Total current liabilities.................... 33,317 53,725 Long-term debt............................... 18,679 5,374 Guaranteed Employees' Stock Ownership Plan obligation........................... 17,438 19,206 Post retirement benefit liability............ 13,285 -- Minimum pension liability.................... 3,348 3,348 Other long-term liabilities.................. 150 150 Deferred income taxes........................ 1,607 1,622 87,824 83,425 Redeemable convertible preferred stock....... 24,000 24,000 Guaranteed Employees' Stock Ownership Plan obligation........................... (16,196) (17,533) Treasury stock, at cost...................... (3,289) (2,789) 4,515 3,678 Common stock................................. 19,410 19,594 Guaranteed Employees' Stock Ownership Plan obligation........................... (1,242) (1,673) Minimum pension liability.................... (3,348) (3,348) Foreign currency translation adjustments..... (3,571) (4,037) Retained earnings............................ 7,739 22,829 18,988 33,365 Less treasury stock, at cost................. 2,061 3,403 16,927 29,962 Total liabilities and stockholders' equity... $109,266 $117,065
4 CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS (IN THOUSANDS) Nine Months Ended August 31 August 31 1994 1993 ----------- ----------- CASH FLOWS FROM OPERATING ACTIVITIES: Net loss..................................... $(13,583) $(8,255) Adjustments to reconcile net loss to cash provided from (used in) operations: Cumulative effect of change in method of accounting for postretirement benefits other than pensions............. 13,416 -- Depreciation and amortization............ 3,470 4,013 Loss on sale of property, plant, and equipment............................. 1 428 Deferred income taxes................... (85) (54) Changes in assets and liabilities: Receivables, net..................... 6,204 (142) Inventories.......................... (4,592) 1,854 Prepaid expenses..................... 66 (312) Accounts payable..................... (5,431) (2,555) Accrued expenses..................... 1,397 (4,464) U.S. and foreign income taxes........ (142) 756 Other................................ (582) 385 Net cash provided from (used in) operations.. 139 (8,346) CASH FLOWS FROM INVESTING AND OTHER ACTIVITIES: Plant and equipment additions................ (1,631) (1,828) Proceeds from sale of property, plant, and equipment................................ 158 2,385 Net cash provided from (used in) investing and other activities....................... (1,473) 557 CASH FLOWS FROM FINANCING ACTIVITIES: Decrease in term debt........................ (3,797) (2,105) Decrease notes payable, banks................ (163) (11,259) Proceeds from issuance of common stock....... 49 11,485 Treasury stock, net.......................... 550 277 Cash dividends............................... (1,215) (1,252) Net cash used in financing activities........ (4,576) (2,854) EFFECT OF TRANSLATION ADJUSTMENT ON CASH................................... 128 (163) CASH AND CASH EQUIVALENTS: Decrease in cash............................. (5,782) (10,806) Beginning of year............................ 9,097 15,517 End of period................................ $ 3,315 $ 4,711
5 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The combined financial impact of a decision to maintain plant employment levels in the face of a temporary downturn in the equipment demand curve and recent competitive pricing pressures resulted in our reporting a loss for the quarter. SALES: Consolidated sales for the fiscal 1994 third quarter were $47,931,000, an increase of 16% from sales of $41,386,000 reported in the comparable period in 1993. Sales of $143,075,000 for the first nine months were up 21% over sales of $118,014,000 reported in the same period last year. EARNINGS: The consolidated net loss for the fiscal 1994 third quarter was $1,473,000, or $0.24 per share, slightly narrower than the loss of $1,938,000, or $0.33 per share, reported in the previous year's third quarter. Nine months consolidated loss was $167,000, or $0.18 per share, before the cumulative effect of an accounting change, a sharp improvement from the loss of $8,255,000, or $1.42 per share, for the same period last year. The net loss, after giving effect to the mandatory noncash accounting change reflecting the 1994 first quarter adoption of Statement of Financial Accounting Standards (SFAS) No. 106 governing accounting for nonpension retiree benefit costs, was $13,583,000, or $1.90 per share. COSTS AND EXPENSES: Gross margin as a percent of sales improved to 21.5%, up from 20.6% reported in the fiscal 1993 third quarter, due to the combined effect of reduced costs and improved product mix. Selling, General, and Administrative expenses increased $1.6 million over the prior year's third quarter to 20.4% of sales versus 19.8% of sales in 1993. The increase was primarily related to costs incurred in connection with the Amoco and VeriFone alliances and increased international marketing efforts. Interest expense was below the prior year due to lower levels of debt throughout the 1994 third quarter and a lower interest rate resulting from a new financing agreement. OTHER: Cash provided from operations for the nine-month period ended August 31, 1994 was $139,000 versus a cash deficit of $8,346,000 in the prior-year nine-month period. The improvement relative to the prior year resulted primarily from the higher sales level and improved receivables collections. Funds used in investing and other activities, were $1,473,000 in 1994 representing $1,631,000 in capital expenditures less $158,000 of proceeds from sale of equipment. Cash provided from investing and other activities in the 1993 nine-month period was $557,000 reflecting $1,828,000 in capital expenditures offset by $2,385,000 of proceeds from the sale of property, plant, and equipment. Cash used in financing activities of $4,576,000, principally representing debt reduction and preferred stock dividend payments, was $1,722,000 greater than the prior year. DIVIDENDS: Financial covenants of Tokheim's current bank agreement preclude the payment of cash dividends on common stock throughout the 1994 fiscal year. 6 OTHER DEVELOPMENTS: Margins were impacted during the third quarter by our conscious decision to maintain plant employment levels and build inventories in anticipation of a sustained upturn in the equipment demand curve. The order rate actually dipped in the third quarter causing manufacturing inefficiencies as production rates were reduced. Soft demand also brought about industry pricing pressures during the past few months. The market is still showing considerable improvement over the prior year. However, a temporary slowdown in order activity during the third quarter, caused by the impact of oil pricing on the profitability of major domestic oil company operations and specific restructuring initiatives undertaken by some of our major oil customers, resulted in our falling short of previously anticipated levels of sales volume and profitability. We have taken action to improve performance in the fourth quarter by trimming manpower levels and accelerating the implementation of cost-reduction value engineering projects. While the collective effect of increased costs and soft pricing resulted in a third quarter loss, the fiscal year continues to show substantial improvement over 1993. Ignoring the effect of the noncash accounting change, on a year-to-date basis, our net operating results are approximately $8,000,000 ahead of last year. That marked improvement stems primarily from increased margins from manufacturing efficiencies achieved and the added impact of higher sales volumes and lower operating expenses as a percent of sales reflecting cost-reduction actions taken in all areas of the business. Order rates have picked up sharply over the past few weeks and are presently running well ahead of last year. The increase in order activity has come from both domestic and international sources. Our expectations are high for a strong fourth quarter and the achievement of our goal of a return to profitability for the year as a whole. I am pleased to announce that John A. Todd has joined the Company as director of engineering. Mr. Todd brings to Tokheim over 20 years of petroleum dispensing and systems engineering experience. For the last 12 years, he has been serving as vice president of engineering of the Wayne Pump Division of Dresser Industries. He will assume responsibility for Tokheim's high-priority Value Engineering Program designed to enhance the manufacturing cost and functional efficiency of product design for both domestic and export products as well as new product development and sustaining engineering. PART II. OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits: (11) Details supporting the computation of primary and fully diluted earnings per share (27) Financial Data Schedule (b) Reports on Form 8-K - None. 7 SIGNATURES 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 thereunto duly authorized. TOKHEIM CORPORATION -------------------------------------- Date October 14, 1994 Douglas K. Pinner ----------------------- -------------------------------------- President and Chief Executive Officer Date October 14, 1994 Jess B. Ford ------------------------ -------------------------------------- Vice President, Finance, Secretary, and Chief Financial Officer 8 TOKHEIM CORPORATION AND SUBSIDIARIES EXHIBIT (11) - EARNINGS PER SHARE FOR THE THREE MONTH AND NINE MONTH PERIODS ENDED AUGUST 31, 1994, AND AUGUST 31, 1993 Primary earnings per share are based on the weighted average number of shares outstanding during each year and the assumed exercise of dilutive employees' stock options less the number of treasury shares assumed to be purchased from the proceeds using the average market price of the Company's common stock. The following table presents information necessary to calculate loss per share for the three-month and nine-month periods ended August 31, 1994 and August 31, 1993: PRIMARY ----------------------------------------------------- Three Months Ended Nine Months Ended August 31, August 31, August 31, August 31, 1994 1993 1994 1993 ----------------------------------------------------- Shares outstanding (in thousands): Weighted average outstanding...................... 7,823 7,069 7,790 6,637 Share equivalents............................... -- 71 -- 71 Adjusted outstanding............................ 7,823 7,140 7,790 6,708 Net loss: Loss before cumulative effect of change in method of accounting for postretirement postretirement benefits other than pensions... $(1,473) $(1,938) $ (167) $ (8,255) Cumulative effect of change in method of accounting for postretirement benefits other than pensions........................... -- -- (13,416) -- Net loss........................................ (1,473) (1,938) (13,583) (8,255) Less preferred stock dividend................... 401 414 1,215 1,252 Net loss applicable to common stock............. $(1,874) $(2,352) $(14,798) $ (9,507) Net loss per common share: Loss before cumulative effect of change in method of accounting for postretirement benefits other than pensions.................. $ (0.24) $ (0.33) $ (0.18) $ (1.42) Cumulative effect of change in method of accounting for postretirement benefits other than pensions........................... -- -- (1.72) -- Net loss per common share....................... $ (0.24) $ (0.33) $ (1.90) $ (1.42)
9 TOKHEIM CORPORATION AND SUBSIDIARIES EXHIBIT (11) - EARNINGS PER SHARE FOR THE THREE MONTH AND NINE MONTH PERIODS ENDED AUGUST 31, 1994, AND AUGUST 31, 1993 For financial reporting purposes, the loss per share, assuming full dilution, is considered to be the same as primary since the effect of the common stock equivalents would be antidilutive. Fully Diluted ----------------------------------------------------- Three Months Ended Nine Months Ended August 31, August 31, August 31, August 31, 1994 1993 1994 1993 ----------------------------------------------------- Shares outstanding (in thousands): Weighted average outstanding.................... 7,823 7,069 7,790 6,637 Share equivalents............................... 52 77 71 77 Weighted conversion of preferred stock.......... 1,371 859 1,280 875 Adjusted outstanding............................ 9,246 8,005 9,141 7,589 Net loss: Loss before cumulative effect of change in method of accounting for postretirement benefits other than pensions.................. $(1,473) $(1,938) $ (167) $ (8,255) Cumulative effect of change in method of accounting for postretirement benefits other than pensions........................... -- -- (13,416) -- Net loss........................................ (1,473) (1,938) (13,583) (8,255) Less preferred stock dividend................... 401 414 1,215 1,252 Net loss applicable to common stock............. $(1,874) $(2,352) $(14,798) $(9,507) Net loss per common share: Loss before cumulative effect of change in method of accounting for postretirement benefits other than pensions.................. $ (0.20) $ (0.29) $ (0.15) $ (1.25) Cumulative effect of change in method of accounting for postretirement benefits other than pensions........................... -- -- (1.47) -- Net loss per common share....................... $ (0.20) $ (0.29) $ (1.62) $ (1.25)
10 EX-27 2
5 This schedule contains summary financial information extracted from Tokheim Corporation's August 31, 1994, interim financial statements and is qualified in its entirety by reference to such financial statements. 0000098559 TOKHEIM CORPORATION 1000 9-MOS NOV-30-1994 AUG-31-1994 3315 0 32332 1318 39598 76397 81229 53796 109266 33317 0 16107 4515 0 820 109266 143075 143075 109369 109369 0 0 1890 308 475 (167) 0 0 (13416) (13583) (1.90) (1.90) Represents gross inventory net of LIFO and loss reserves. Represents gross PP&E. Represents common stock of $19,410 less Guaranteed ESOP of $1,242 and treasury stock of $2,061. Represents redeemable preferred stock of $24,000 less Guaranteed ESOP of $16,196 and treasury stock of $3,289. Represents retained earnings of $7,739 less minimum pension liability of $3,348 and foreign currency translation adjustments of $3,571. Includes product development expenses and excludes depreciation and amortization. Represents adoption of SFAS No. 106, "Employers' Accounting for Postretirement Benefits Other Than Pensions". Fully diluted earnings per share is considered to be the same as primary earnings per share, since the effect of certain potentially dilutive securities would be antidilutive.
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