-----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, AE3qn8shVCBjQajGWx0nynW9K+AnlHHmKUzwMpQ5MjYiZDQ+qo7KZJEtqyq6ZZTT FNkh/9G506jILJIDlbLQVA== 0000098677-96-000005.txt : 19960508 0000098677-96-000005.hdr.sgml : 19960508 ACCESSION NUMBER: 0000098677-96-000005 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960330 FILED AS OF DATE: 19960507 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: TOOTSIE ROLL INDUSTRIES INC CENTRAL INDEX KEY: 0000098677 STANDARD INDUSTRIAL CLASSIFICATION: SUGAR & CONFECTIONERY PRODUCTS [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: 96557152 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 TOOTSIE ROLL INDUSTRIES, INC. 10-Q ENDING 03/30/96 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 March 30, 1996 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 15,574,428 Class B Common Stock, $.69 4/9 par value 7,429,625 2 PART I - FINANCIAL INFORMATION TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED)
ASSETS March 30 April 1 Dec. 31 CURRENT ASSETS 1996 1995 1995 Cash & Cash Equiv. $ 30,835,259 $ 22,411,874 $ 47,523,986 Marketable Securities 72,343,386 40,130,450 55,925,732 Accounts Receivable Less Allowances of $1,962,000,$1,476,000 & $1,774,000 23,195,231 22,606,310 23,553,517 Inventories at Cost (Last-in,First-out): Finished Goods & Work in Process 24,802,427 23,582,547 19,584,849 Raw Material & Supplies 14,750,274 14,647,277 12,624,820 Prepaid Expenses 4,638,565 3,077,542 2,812,763 Deferred Income Taxes 2,923,000 2,455,583 2,923,000 Total Current Assets 173,488,142 128,911,583 164,948,667 PROPERTY, PLANT & EQUIPMENT, (at Cost) Land 6,906,137 6,936,880 6,899,832 Building 28,270,993 27,254,752 28,259,052 Machinery & Equip. 117,799,121 109,437,699 111,660,755 152,976,251 143,629,331 146,819,639 Less-Accumulated Deprec. and Amortization 66,586,207 59,146,475 64,820,354 86,390,044 84,482,856 81,999,285 OTHER ASSETS Intangibles 95,285,327 97,991,627 95,961,902 Miscellaneous Investment 52,535 52,535 52,535 Misc. Other Assets 10,946,532 6,836,845 10,853,931 106,284,394 104,881,007 106,868,368 Total Assets $366,162,580 $318,275,446 $353,816,320 -2-
3
(UNAUDITED) LIABILITIES AND SHAREHOLDERS' EQUITY March 30 April 1 Dec. 31 CURRENT LIABILITIES 1996 1995 1995 Notes Payable to Banks $ 20,000,000 $ -- $ 20 000 000 Accounts Payable 8,675,287 6,303,796 5,911,910 Dividends Payable 1,479,368 1,333,885 1,424,014 Accrued Liabilities 19,482,384 16,426,836 21,531,891 Fed. & State Income Taxes 10,918,211 6,452,654 6,438,353 Total Current Liabilities 60,555,250 30,517,171 55,306,168 NON-CURRENT LIABILITIES E.T.I. Term Loan -- 20,000,000 -- Ind.Dev.Bonds Ser.1992 7,500,000 7,500,000 7,500,000 Post Retirement Benefits 5,479,722 5,096,401 5,385,539 Deferred Compensation 4,435,990 3,296,721 4,526,936 Deferred Fed.Inc.Taxes 9,053,268 7,366,000 8,911,222 Total Non-Current Liabilities 26,468,980 43,259,122 26,323,697 SHAREHOLDERS' EQUITY Common Stk., $.69-4/9 par value- 25,000,000 shares author. 15,574,428, 7,535,142 & 15,108,790 respectively, issued 10,815,436 5,232,602 10,492,076 Class B Common Stk $.69-4/9 par value- 10,000,000 shares author. 7,429,625, 3,636,190 & 7,233,874 respectively issued 5,159,395 2,525,067 5,023,457 Capital in Excess of Par Value 171,588,958 153,929,275 146,171,411 Retained Earnings 102,266,617 92,616,954 121,476,879 Cumulative Translation Adjustment (10,692,056) (9,804,745) (10,977,368) Total Shareholders' Equity 279,138,350 244,499,153 272,186,455 Total Liabilities and Shareholders' Equity $366,162,580 $318,275,446 $ 353,816,320 -2-
4 TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS AND RETAINED EARNINGS (NOTE 1) (UNAUDITED)
13 Weeks Ended March 30, 1996 & April 1, 1995 1996 1995 NET SALES (Note 2) $ 63,264,854 $ 60,269,205 Cost of goods sold 32,578,259 30,702,860 Gross Margin 30,686,595 29,566,345 Operating Expenses: Marketing, Selling and Advertising 9,620,514 9,770,951 Distribution and Warehousing 4,831,342 4,787,283 General and Administrative 3,620,941 3,286,297 Goodwill amortization 676,575 676,575 18,749,372 18,521,106 Earnings from Operations 11,937,223 11,045,239 Other Income (Expense) Net 1,057,739 706,231 Earnings before Income Taxes 12,994,962 11,751,470 Provision for Income Taxes 4,877,000 4,433,000 Net Earnings (Note 5) 8,117,962 7,318,470 Retained Earnings at beginning of period 121,476,879 107,762,823 129,594,841 115,081,293 Deduct: Cash Dividends 1,368,038 1,193,248 Stock Dividends - 3% 25,960,186 21,271,091 27,328,224 22,464,339 Retained Earnings at end of period $102,266,617 $ 92,616,954 Net Earnings per Share (Note 3) $ .35 $ .32 Dividends Per Share * $ .0625 $ .055 Average Number of Shares Outstanding (Notes 3 & 4) 23,004,053 23,004,053 *Does not include 3% Stock Dividend to Shareholders of Record on 3/11/96 and 3/10/95 and has been restated for the 2- for 1- Stock Split to Shareholders of Record 6/22/95.
-3- 5 TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
13 Weeks Ended March 30, 1996 & April 1, 1995 1996 1995 CASH FLOWS FROM OPERATING ACTIVITIES: Net Earnings $ 8,117,962 $ 7,318,470 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization 2,772,611 2,332,863 (Increase) decrease in assets: Accounts receivable 422,191 (2,733,373) Inventories (7,241,236) (8,858,292) Prepaid expenses and other assets (118,206) 47,453 Increase (decrease) in liabilities: Accounts payable and accrued liabilities 686,722 (431,464) Income taxes payable and deferred 2,933,948 3,972,551 Postretirement health care and life insurance benefits 94,183 103,682 Other long term liabilities (90,946) 145,157 Other 119,150 -- Net cash provided by operating activities 7,696,379 1,897,047 CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures (6,571,427) (531,411) Investment purchases (21,625,851) (4,760,586) Investment sales 5,208,198 10,491,056 Net cash provided by (used in) investing activities (22,989,080) 5,199,059 CASH FLOWS FROM FINANCING ACTIVITIES: Dividends paid in cash (1,396,026) (1,192,891) Net cash used in financing activities (1,396,026) (1,192,891) Increase (decrease) in cash and cash equivalents (16,688,727) 5,903,215 Cash and cash equivalents-beginning of year 47,523,986 16,508,659 Cash and cash equivalents end of quarter $30,835,259 $22,411,874 Supplemental cash flow information: Income taxes paid $ 301,000 $ 308,000 Interest paid $ 372,000 $ 459,000
6 TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS MARCH 30, 1996 (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. All adjustments were of a normal and recurring nature. Note 2 - The Company's unshipped orders at March 30, 1996 amounted to $13,200,000. Note 3 - Based on Average Shares outstanding adjusted for Stock Dividends and the 2 - for - 1 Stock Split in 1995. Note 4 - Includes 3% Stock Dividends distributed on April 23, 1996 and April 21, 1995 and the 2 - for 1 - Stock Split effective on July 11, 1995. Note 5 - Results of operations for the period ended March 30, 1996 are not necessarily indicative of results to be expected for the year to end December 31, 1996 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 1996. Note 7 - Sales of unregistered Securities - None. 7 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, 1996 First Quarter vs. 1996 1995 First Quarter, 1995 $63,264,854 $60,269,205 +5.0% First Quarter 1996 net sales of $63,264,854, a record, were up 5.0% from First Quarter 1995 net sales of $60,269,205. Sales rose as a result of successful promotional programs, product line extensions and the introduction of new products into the distribution channels. Consolidated sales were also favorably affected by improved results in Mexico. First Quarter 1996 net sales of $63,264,854 were down from Fourth Quarter 1995 net sales of $67,145,159. This is not considered unusual as the First Quarter of the year is normally the company's lowest quarter in sales and is consistent with the historical trend. COST OF SALES: Cost of Sales as a First Quarter Percentage of Net Sales 1996 1995 1st Qtr. 1996 1st Qtr. 1995 $32,578,259 $30,702,860 51.5% 50.9% Cost of sales as a percentage of net sales increased slightly from 50.9% for First Quarter 1995 to 51.5% for First Quarter 1996. This increase principally reflects increases in certain ingredients costs. NET EARNINGS: First Quarter, 1996 First Quarter vs. 1996 1995 First Quarter, 1995 $8,117,962 $7,318,470 +10.9% First Quarter 1996 net earnings of $8,117,962 or $0.35 per share, a record, were up 10.9% from net earnings of $7,318,470 or $0.32 per share for the First Quarter 1995. The increase in net earnings reflects higher sales, control of operating expenses resulting in improved margins from operations and increased net investment income. - -6- First Quarter 1996 net earnings of $8,117,962 decreased $372,377 or 4.4% from Fourth Quarter of 1995 net earnings of $8,490,339, which reflects the lower level of sales in the First Quarter 1996 compared to the Fourth Quarter 1995. This is consistent with historical trends. -6 A- 8 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: May 1, 1996 BY: Melvin J. Gordon Chairman of the Board BY: G. Howard Ember Vice President - Finance -7- EX-27 2 ARTICLE 5 FIN. DATA SCHEDULE FOR 1ST QTR 10-Q
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION AND CONSOLIDATED STATEMENTS OF EARNINGS AND RETAINED EARNINGS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 Dec-31-1996 Jan-01-1996 Mar-30-1996 3-MOS 30,835 72,343 25,157 1,962 39,553 173,488 152,976 66,586 366,163 60,555 7,500 00 00 15,975 263,164 366,163 63,265 63,265 32,578 18,749 (1,058) 130 369 12,995 4,877 8,118 0 0 0 8,118 .35 .35
-----END PRIVACY-ENHANCED MESSAGE-----