-----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, hv5klYLlAIrq1vo44WX3bxP/dasv02knIUgLCaYCCz2mMx4xJLwya2cv/jUojZSY G6A0ntCdSXyzJLQVJsUwow== 0000098677-94-000002.txt : 19940429 0000098677-94-000002.hdr.sgml : 19940429 ACCESSION NUMBER: 0000098677-94-000002 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19940402 FILED AS OF DATE: 19940428 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TOOTSIE ROLL INDUSTRIES INC CENTRAL INDEX KEY: 0000098677 STANDARD INDUSTRIAL CLASSIFICATION: 2060 IRS NUMBER: 221318955 STATE OF INCORPORATION: VA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-01361 FILM NUMBER: 94524964 BUSINESS ADDRESS: STREET 1: 7401 S CICERO AVE CITY: CHICAGO STATE: IL ZIP: 60629 BUSINESS PHONE: 3128383400 FORMER COMPANY: FORMER CONFORMED NAME: SWEETS CO OF AMERICA INC DATE OF NAME CHANGE: 19660921 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended April 2, 1994 Commission File Number 1 - 1361 TOOTSIE ROLL INDUSTRIES, INC. (Exact name of registrant as specified in its charter) VIRGINIA 22 - 1318955 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 7401 South Cicero Avenue Chicago, Illinois 60629 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (312) 838 - 3400 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 close of the period covered by this report. Class Outstanding Common Stock, $.69 4/9 par value 7,292,008 Class B Common Stock, $.69 4/9 par value 3,555,701
PART I - FINANCIAL INFORMATION TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED) ASSETS April 2 April 3 Dec. 31 CURRENT ASSETS 1994 1993 1993 Cash & Cash Equiv. $ 7,076,593 $ 1,930,248 $ 1,985,809 Marketable Securities 45,810,891 84,431,959 54,217,079 Accounts Receivable Less Allowances of $1,856,000,$1,581,000 & $2,075,000 24,104,898 13,585,991 20,656,006 Inventories at Cost (Last-in,First-out): Finished Goods & Work in Process 26,300,333 23,611,207 17,186,423 Raw Material & Supplies 11,294,067 11,762,990 12,107,728 Prepaid Expenses 4,518,666 2,822,383 3,666,901 Deferred Income Taxes 2,094,000 1,992,000 2,094,000 Total Current Assets 121,199,448 140,136,778 111,913,946 PROPERTY, PLANT & EQUIPMENT, (at Cost) Land 4,250,667 230,667 4,230,667 Building 25,347,199 4,861,047 25,347,199 Machinery & Equip. 107,900,222 79,460,759 107,685,361 Leasehold Impvts. 5,641 4,840,902 9,641 137,503,729 89,393,375 137,272,868 Less-Accumulated Deprec. and Amortization 52,230,589 46,067,539 50,573,679 85,273,140 43,325,836 86,699,189 OTHER ASSETS Intangibles 100,697,927 44,882,343 101,374,501 Miscellaneous Invest. 90,977 107,169 90,977 Misc. Other Assets 3,786,750 5,837,293 3,861,219 104,575,654 50,826,805 105,326,697 Total Assets $311,048,242 $234,289,419 $303,939,832
LIABILITIES AND SHAREHOLDERS' EQUITY April 2 April 3 Dec. 31 CURRENT LIABILITIES 1994 1993 1993 Bank Loans Short Term $ 20,000,000 $ -- $22 600,673 Accounts Payable 6,840,051 5,358,308 6,259,252 Dividends Payable 1,153,426 943,810 1,025,428 Accrued Liabilities 17,112,955 13,414,888 17,918,747 Fed. & State Income Taxes 6,920,753 6,624,335 3,057,290 Total Current Liabilities 52,027,185 26,341,341 50,861,390 NON-CURRENT LIABILITIES E.T.I. Term Loan 20,000,000 -- 20,000,000 Ind.Dev.Bonds Ser.1992 7,500,000 7,500,000 7,500,000 Post Retirement Benefits 4,630,487 4,101,280 4,497,834 Deferred Compensation 2,494,603 2,940,850 2,373,454 Deferred Fed.Inc.Taxes 6,263,422 5,925,453 6,363,886 Total Non-Current Liabilities 40,888,512 20,467,583 40,735,174 SHAREHOLDERS' EQUITY Common Stk., $.69-4/9 par value- 25,000,000 shares author. 7,292,008, 7,044,098 & 7,068,561 respectively, issued 5,063,759 4,891,600 4,908,588 Class B Common Stk $.69-4/9 par value- 10,000,000 shares author. 3,555,701, 3,489,478 & 3,465,015 respectively issued 2,469,171 2,423,182 2,406,194 Capital in Excess of Par Value 132,997,160 111,108,198 111,108,198 Retained Earnings 80,373,345 70,903,247 96,646,704 Cumulative Translation Adjustment (2,770,890) (1,845,732) (2,726,416) Total Shareholders' Equity 218,132,545 187,480,495 212,343,268 Total Liabilities and Shareholders' Equity $311,048,242 $234,289,419 $303,939,832
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS AND RETAINED EARNINGS (NOTE 1) (UNAUDITED) 13 Weeks Ended April 2, 1994 & April 3, 1993 1994 1993 NET SALES (Note 2) $ 56,370,043 $ 50,016,955 Cost of goods sold 28,248,858 24,736,353 Gross Margin 28,121,185 25,280,602 Operating Expenses: Marketing, Selling and Advertising 9,272,937 8,391,471 Distribution and Warehousing 4,110,656 3,780,765 General and Administrative 3,051,475 3,129,243 Goodwill amortization 676,575 312,927 17,111,643 15,614,406 Earnings from Operations 11,009,542 9,666,196 Other Income (Expense) Net 358,610 1,186,764 Earnings before Income Taxes 11,368,152 10,852,960 Provision for Income Taxes 4,406,000 4,157,000 Net Earnings (Note 5) 6,962,152 6,695,960 Retained Earnings at beginning of period 96,646,704 90,285,436 103,608,856 96,981,396 Deduct: Cash Dividends 1,000,709 767,168 Stock Dividends - 3% 22,234,802 25,310,981 23,235,511 26,078,149 Retained Earnings at end of period $ 80,373,345 $ 70,903,247 Net Earnings per Share (Note 3) $ .64 $ .62 Dividends Per Share * $ .095 $ .075 Average Number of Shares Outstanding (Notes 3 & 4) 10,847,709 10,847,709 *Does not include 3% Stock Dividend to Shareholders of Record on 3/11/94 and 3/18/93.
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) 13 Weeks Ended April 2, 1994 & April 3, 1993 1994 1993 CASH FLOWS FROM OPERATING ACTIVITIES: Net Earnings $ 6,962,152 $ 6,695,960 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization 2,893,329 1,614,077 (Increase) decrease in assets: Accounts receivable (3,448,892) (697,140) Inventories (8,300,249) (10,528,591) Prepaid expenses and other assets (851,765) 162,863 Increase (decrease) in liabilities: Accounts payable and accrued liabilities (224,993) 437,708 Income taxes payable and deferred 3,762,999 3,444,227 Postretirement health care and life insurance benefits 132,653 125,507 Other long term liabilities 121,149 135,161 Other (44,474) -- Net cash used in operating activities 1,001,909 1,389,772 CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures (778,678) (2,815,313) Investment purchases (5,748,525) (1,636,942) Investment sales 14,154,181 5,017,745 Net cash provided by investing activities 7,626,978 565,490 CASH FLOWS FROM FINANCING ACTIVITIES: Repayment under lines of credit agreements (2,600,673) -- Dividends paid in cash (1,000,403) (766,931) Other, net 62,973 (252,569) Net cash provided by (used in) financing activities (3,538,103) (1,019,500) Increase (decrease) in cash equivalents 5,090,784 935,762 Cash and cash equivalents-beginning of year 1,985,809 994,486 Cash and cash equivalents end of quarter $ 7,076,593 $ 1,930,248 Supplemental cash flow information: Income taxes paid $ 460,000 $ 472,000 Interest paid $ 693,000 $ 60,000
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS APRIL 2, 1994 (UNAUDITED) Note 1 - Foregoing data has been prepared from the unaudited financial records of the Company and in the opinion of Management all adjustments necessary for a fair statement of the results for the interim period have been reflected. Note 2 - The Company's unshipped orders at April 2, 1994 amounted to $6,884,000. Note 3 - Based on Average Shares outstanding adjusted for Stock Dividends. Note 4 - Includes 3% Stock Dividends distributed on April 22, 1994 and April 22, 1993. Note 5 - Results of operations for the period ended April 2, 1994 are not necessarily indicative of results to be expected for the year to end December 31, 1994 because of the seasonal nature of the Company's operations. Historically, the Third Quarter has been the Company's largest Sales Quarter due to Halloween Sales. Note 6 - Form 8-K was not required to be filed during the First Quarter of 1994. Note 7 - Sales of unregistered Securities - None. MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE CONSOLIDATED STATEMENTS OF EARNINGS The following is Management's discussion of the Company's operating results and analysis of factors which have affected the accompanying Statement of Earnings: NET SALES: First Quarter, 1994 First Quarter vs. 1994 1993 First Quarter, 1993 $56,370,043 $50,016,955 +12.7% First Quarter 1994 net sales of $56,370,043, a record, were up 12.7% from the First Quarter 1993 net sales of $50,016,955. Sales rose principally as a result of the inclusion of the former Warner Lambert Chocolate/Caramel Division acquired in the fourth quarter of 1993. Excluding the former Warner Lambert Brands, sales would have decreased by approximately 2%. This decrease is largely due to general softness in the candy industry as well as the effects of consolidation in the warehouse club class of trade which particularly affected the Charm's brands. First Quarter 1994 net sales of $56,370,043 were down from Fourth Quarter 1993 net sales of $62,413,610. This is not considered unusual as the First Quarter of the year is normally the company's lowest quarter in sales. COST OF SALES: Cost of Sales as a First Quarter Percentage of Net Sales 1994 1993 1st Qtr. 1994 1st Qtr. 1993 $28,248,858 $24,736,353 50.1% 49.5% Cost of sales as a percentage of net sales increased slightly from 49.5% for the First Quarter of 1993 to 50.1% for the First Quarter of 1994. This increase reflects some changes in the sales mix of products, increases in certain raw material costs, and minor increases in overall manufacturing overhead costs, principally depreciation and equipment leasing. NET EARNINGS: First Quarter, 1994 First Quarter vs. 1994 1993 First Quarter, 1993 $6,962,152 $6,695,960 +4.0% First Quarter 1994 net earnings of $6,962,152 or $0.64 per share, a record, were up 4.0% from net earnings of $6,695,960 or $0.62 per share for the First Quarter of 1993. Net earnings increased principally as a result of a 14% increase in earnings from operations which is principally attributable to the additional profit contribution from the former Warner Lambert Chocolate/Caramel Division. As a percentage of sales these earnings for the First Quarter, decreased from 13.4% in 1993 to 12.4% in 1994. The aforementioned reflects lower investment income, net of interest expense, due to the purchase of the former Warner Lambert Chocolate/Caramel Division in the fourth quarter of 1993. Net earnings for the First Quarter of 1994 of $6,962,152 decreased $58,352 or 0.8% from Fourth Quarter of 1993 net earnings of $7,020,504. PART II - OTHER INFORMATION TOOTSIE ROLL INDUSTRIES, INC AND SUBSIDIARIES - NONE - 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. TOOTSIE ROLL INDUSTRIES, INC. Date: April 28, 1994 BY: Melvin J. Gordon Chairman of the Board BY: G. Howard Ember Vice President - Finance -----END PRIVACY-ENHANCED MESSAGE-----