-----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, BLTz34S9XXjKCL35dprXVhiBufVemUP//Fj78waRbCR/Wi5K7PPygnTRunR0B9sO AbQMndzVU8K2b8FszxWq7w== 0000899243-00-000192.txt : 20000209 0000899243-00-000192.hdr.sgml : 20000209 ACCESSION NUMBER: 0000899243-00-000192 CONFORMED SUBMISSION TYPE: 10-Q/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19990930 FILED AS OF DATE: 20000208 FILER: COMPANY DATA: COMPANY CONFORMED NAME: US CONCRETE INC CENTRAL INDEX KEY: 0001073429 STANDARD INDUSTRIAL CLASSIFICATION: CONCRETE PRODUCTS, EXCEPT BLOCK & BRICK [3272] IRS NUMBER: 760688680 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q/A SEC ACT: SEC FILE NUMBER: 000-26025 FILM NUMBER: 527501 BUSINESS ADDRESS: STREET 1: 1360 POST OAK BLVD STREET 2: SUITE 800 CITY: HOUSTON STATE: TX ZIP: 77065 BUSINESS PHONE: 7133506000 MAIL ADDRESS: STREET 1: 1360 POST OAK BLVD STREET 2: SUITE 800 CITY: HOUSTON STATE: TX ZIP: 77065 FORMER COMPANY: FORMER CONFORMED NAME: RMX INDUSTRIES INC DATE OF NAME CHANGE: 19981113 10-Q/A 1 QUARTERLY REPORT FOR PERIOD ENDED SEPT. 30 1999 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q/A ----------- (MARK ONE) [X] Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended September 30, 1999 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 1-12977 ----------------------------------------------------- U.S. CONCRETE, INC. - -------------------------------------------------------------------------------- (exact name of registrant as specified in its charter) Delaware 76-0586680 - -------------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1300 Post Oak Blvd., Suite 1220, Houston, Texas 77056 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code: (713) 499-6200 -------------- 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 the filing requirements for at least the past 90 days. Yes X No _______ ------ U.S. Concrete, Inc. had 18,633,609 shares of its Common Stock, par value $.001 per share, outstanding at February 7, 2000. This Amendment No. 1 on Form 10-Q/A amends Item 1 of the Quarterly Report on Form 10-Q of U.S. Concrete, Inc. for the quarter ended September 30, 1999, to revise our previously reported balances for goodwill, accounts payable and accrued liabilities and retained earnings as reflected on our consolidated balance sheet as of September 30, 1999 and our consolidated statement of cash flows for the nine months ended September 30, 1999. This revision reflects an adjustment to record an additional liability for taxes and purchase price adjustments related to acquisitions. This revision has no impact on our previously reported historical or pro forma results of operations for any periods presented. In accordance with Rule 12b-15 under the Securities Exchange Act of 1934, this Amendment No. 1 sets forth the complete text to Item 1 of Part I of our Form 10- Q for the quarter ended September 30, 1999, as amended. PART I Item 1. Financial Statements PRO FORMA COMBINED FINANCIAL INFORMATION ORGANIZATION AND BASIS OF PRESENTATION U.S. Concrete, Inc., a Delaware corporation, was founded in July 1997 to create a leading provider of ready-mixed concrete and related products and services to the construction industry in major markets in the United States. It did not conduct any operations prior to May 1999. On May 28, 1999, it completed an initial public offering of its common stock and concurrently acquired six operating businesses. From the date of its IPO through September 30, 1999, U.S. Concrete acquired four additional operating businesses for approximately $13.2 million in cash and 1.7 million shares of common stock. U.S. Concrete intends to acquire additional companies to expand its operations. For financial statement presentation purposes, (1) Central Concrete Supply Co., Inc., one of the acquired businesses, is presented as the acquirer of the other acquired businesses and U.S. Concrete, (2) these acquisitions are accounted for in accordance with the purchase method of accounting and (3) the effective date of the initial acquisitions is May 31, 1999. As used in this report, the term "Company" means (1) Central prior to June 1, 1999 and (2) U.S. Concrete and its consolidated subsidiaries on that date and thereafter. The accompanying unaudited pro forma combined statements of operations for the three and nine months ended September 30, 1999 and 1998, respectively, assume that U.S. Concrete completed the following transactions on January 1 in each period presented: . its issuance and sale in the IPO of 4.4 million shares of its common stock (including shares it sold on the exercise of its underwriters' over-allotment option) at $8.00 per share; . its application of its net proceeds from the IPO; . its acquisition of the 10 operating businesses and its payment of the purchase prices for those businesses; and . its refinancing with borrowings under its credit facility of the indebtedness it assumed as a result of the acquisitions. These statements also reflect pro forma adjustments for: . certain contractual reductions in salaries, bonuses and benefits to former owners of the operating businesses; . elimination of legal, accounting and other professional fees incurred in connection with the acquisitions of businesses; . amortization of goodwill resulting from the acquisitions of businesses; . reduction in interest expense, net of interest expense on borrowings to fund S corporation distributions by certain businesses; and . adjustments to the federal and state income tax provision based on pro forma operating results. These statements do not reflect the operations of the two businesses acquired by the Company subsequent to September 30, 1999. You should read the accompanying unaudited pro forma combined statements of operations together with the Company's historical unaudited financial statements and notes thereto this report includes. The pro forma adjustments are based on estimates, available information and certain assumptions which may be revised as additional information becomes available. The pro forma financial information does not purport to represent what the Company's combined financial position or results of operations would actually have been if such transactions had in fact occurred when assumed and are 2 not necessarily representative of the Company's financial position or results of operations for any future period. Since U.S. Concrete and its acquired businesses were not under common control or management for all or a portion of the periods presented, historical combined results may not be comparable to, or indicative of, future performance. 3 U.S. CONCRETE, INC. AND SUBSIDIARIES PRO FORMA COMBINED STATEMENTS OF OPERATIONS (in thousands, except per share amounts; unaudited)
Three Months Nine Months Ended September 30, Ended September 30, ------------------------------- ------------------------------- 1999 1998 1999 1998 ------------- -------------- ------------- -------------- Sales $69,531 $71,085 $175,897 $170,639 Cost of goods sold 55,016 56,489 139,442 137,149 ------------- -------------- ------------- -------------- Gross profit 14,515 14,596 36,455 33,490 Selling, general and administrative expenses 3,444 4,972 13,536 13,571 Stock compensation charge -- -- 2,880 -- Depreciation and amortization 1,483 1,461 4,384 4,384 ------------- -------------- ------------- -------------- Income from operations 9,588 8,163 15,655 15,535 Interest expense, net (670) (1,088) (2,271) (3,263) Other income, net 339 199 1,256 455 ------------- -------------- ------------- -------------- Income before income tax provision 9,257 7,274 14,640 12,727 Income tax provision 3,675 2,888 6,910 5,053 ------------- -------------- ------------- -------------- Net income $ 5,582 $ 4,386 $ 7,730 $ 7,674 ============= ============== ============= ============== Net income per share: Basic $ 0.31 $ 0.24 $ 0.43 $ 0.43 ============= ============== ============= ============== Diluted $ 0.31 $ 0.24 $ 0.43 $ 0.43 ============= ============== ============= ============== Number of shares used in calculating net income per share: Basic 17,945 17,945 17,945 17,945 ============= ============== ============= ============== Diluted 18,036 17,945 18,018 17,945 ============= ============== ============= ==============
The accompanying notes are an integral part of these pro forma combined financial statements. 4 U.S. CONCRETE, INC. AND SUBSIDIARIES NOTES TO PRO FORMA COMBINED STATEMENTS OF OPERATIONS (unaudited) 1. SHARES USED IN COMPUTING PRO FORMA NET INCOME PER SHARE The following table summarizes the number of shares (in thousands) of common stock used in calculating pro forma net income per share:
Three Months Nine Months Ended September 30, Ended September 30, ---------------------------- ---------------------------- 1999 1998 1999 1998 ------------- ------------ ------------- ------------ Shares issued to Central's owners 3,120 3,120 3,120 3,120 Shares issued to owners of acquired businesses other than Central 7,602 7,602 7,602 7,602 Shares issued to the initial stockholders and certain management personnel of U.S. Concrete 2,853 2,853 2,853 2,853 Shares issued in the IPO 4,370 4,370 4,370 4,370 ------------- ------------ ------------- ------------ Number of shares used in calculating basic net income per share 17,945 17,945 17,945 17,945 Effect of shares issuable under stock options and warrants based on the treasury stock method 91 -- 73 -- ------------- ------------ ------------- ------------ Number of shares used in calculating diluted net income per share 18,036 17,945 18,018 17,945 ============= ============ ============= ============
5 U.S. CONCRETE, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands)
September 30, December 31, 1999 1998 --------------------- --------------------- (unaudited) ASSETS Current assets: Cash and cash equivalents $ 5,994 $ 4,213 Trade accounts receivable, net 40,192 7,641 Receivables from related parties 1,658 2,712 Inventories 3,408 792 Prepaid expenses 2,333 833 Deferred tax asset 157 -- Other current assets 833 156 --------------------- --------------------- Total current assets 54,575 16,347 --------------------- --------------------- Property, plant and equipment, net 49,079 9,138 Goodwill, net 74,555 -- Cash surrender value of life insurance -- 1,155 Other assets 1,007 -- --------------------- --------------------- Total assets $179,216 $26,640 ===================== ===================== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current maturities of long-term debt $ 136 $ 1,006 Accounts payable and accrued liabilities 36,881 7,910 --------------------- --------------------- Total current liabilities 37,017 8,916 --------------------- --------------------- Long-term debt, net of current maturities 32,222 2,524 Deferred income taxes 6,704 46 --------------------- --------------------- Total liabilities 75,943 11,486 --------------------- --------------------- Stockholders' equity Common stock 18 70 Additional paid-in capital 101,082 554 Retained earnings 2,173 14,530 --------------------- --------------------- Total stockholders' equity 103,273 15,154 --------------------- --------------------- Total liabilities and stockholders' equity $179,216 $26,640 ===================== =====================
The accompanying notes are an integral part of these condensed consolidated financial statements. 6 U.S. CONCRETE, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts; unaudited)
Three Months Nine Months Ended September 30, Ended September 30, -------------------------------- -------------------------------- 1999 1998 1999 1998 -------------- -------------- -------------- -------------- Sales $59,803 $21,482 $100,407 $47,175 Cost of goods sold 48,078 17,161 80,853 38,491 -------------- -------------- -------------- -------------- Gross profit 11,725 4,321 19,554 8,684 Selling, general and administrative expenses 2,281 1,712 5,738 3,368 Stock compensation charge -- -- 2,880 -- Depreciation and amortization 1,148 219 2,106 679 -------------- -------------- -------------- -------------- Income from operations 8,296 2,390 8,830 4,637 Interest expense, net (463) (35) (742) (12) Other income, net 292 22 626 50 -------------- -------------- -------------- -------------- Income before income tax provision 8,125 2,377 8,714 4,675 Income tax provision 3,212 37 4,854 68 -------------- -------------- -------------- -------------- Net income $ 4,913 $ 2,340 $ 3,860 $ 4,607 ============== ============== ============== ============== Net income per share: Basic $ 0.30 $ 0.75 $ 0.40 $ 1.48 ============== ============== ============== ============== Diluted $ 0.30 $ 0.75 $ 0.40 $ 1.48 ============== ============== ============== ============== Number of shares used in calculating net income per share: Basic 16,498 3,120 9,562 3,120 ============== ============== ============== ============== Diluted 16,589 3,120 9,636 3,120 ============== ============== ============== ==============
The accompanying notes are an integral part of these condensed consolidated financial statements. 7 U.S. CONCRETE, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands; unaudited)
Nine Months Ended September 30, --------------------------------------- 1999 1998 ----------------- ----------------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 3,860 $ 4,607 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 2,106 679 Net gain on sale of property, plant and equipment (217) 13 Deferred income tax provision 924 -- Change in allowance for doubtful accounts 242 16 Stock compensation charge 2,880 -- Changes in assets and liabilities, excluding effects of acquisitions: Trade accounts receivable (9,322) (1,853) Prepaid expenses and other current assets (1,608) 154 Accounts payable and accrued liabilities 9,108 2,961 ----------------- ----------------- Net cash provided by operating activities 7,973 6,577 ----------------- ----------------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property, plant and equipment (2,847) (2,860) Payments for acquisitions accounted for as purchases, net of cash received of $10,078 (55,661) -- Proceeds from disposals of property, plant and equipment 2,330 14 Increase in cash surrender value of life insurance -- (106) ----------------- ----------------- Net cash used in investing activities (56,178) (2,952) ----------------- ----------------- CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from borrowings 32,148 1,857 Repayments of borrowings (3,501) (706) Proceeds from issuances of common stock 32,512 -- Cash paid related to common stock issuance costs (3,459) -- Distributions to stockholders (7,714) (1,801) ----------------- ----------------- Net cash provided by (used in) financing activities 49,986 (650) ----------------- ----------------- NET INCREASE IN CASH AND CASH EQUIVALENTS 1,781 2,975 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 4,213 1,945 ----------------- ----------------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 5,994 $ 4,920 ================= ================= SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid during the period for interest $ 705 $ 262 Cash paid during the period for income taxes $ 370 $ -- NONCASH FINANCING ACTIVITY: Distribution of cash surrender value of life insurance to stockholder $ 1,155 $ --
The accompanying notes are an integral part of these condensed consolidated financial statements. 8 U.S. CONCRETE, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited) 1. ORGANIZATION AND BASIS OF PRESENTATION U.S. Concrete, Inc., a Delaware corporation, was founded in July 1997 to create a leading provider of ready-mixed concrete and related products and services to the construction industry in major markets in the United States. It did not conduct any operations prior to May 1999. On May 28, 1999, it completed an initial public offering of its common stock and concurrently acquired six operating businesses. From the date of its IPO through September 30, 1999, U.S. Concrete acquired four additional operating businesses for approximately $13.2 million in cash and 1.7 million shares of common stock. U.S. Concrete intends to acquire additional companies to expand its operations. For financial statement presentation purposes, (1) Central Concrete Supply Co., Inc., one of the acquired businesses, is presented as the acquirer of the other acquired businesses and U.S. Concrete, (2) these acquisitions are accounted for in accordance with the purchase method of accounting and (3) the effective date of the initial acquisitions is May 31, 1999. As used in this report, the term "Company" means (1) Central prior to June 1, 1999 and (2) U.S. Concrete and its consolidated subsidiaries on that date and thereafter. Under applicable regulations of the SEC, the historical financial statements in this report are unaudited and omit information and footnote disclosures that financial statements prepared in accordance with generally accepted accounting principles normally would include. In the opinion of management, (1) the disclosures herein are adequate to make the information presented not misleading and (2) the financial statements reflect all elimination entries and normal adjustments that are necessary for a fair presentation of the results for the interim periods presented. Operating results for interim periods are not necessarily indicative of the results for full years. You should read these condensed consolidated financial statements together with the audited financial statements and related notes, which U.S. Concrete's registration statement for its IPO includes. 2. SIGNIFICANT ACCOUNTING POLICIES The Company has not added to or changed its accounting policies significantly since December 31, 1998. For a description of these policies, see Note 2 of Notes to Financial Statements of Central in U.S. Concrete's IPO registration statement. 3. SUBSEQUENT BUSINESS COMBINATIONS From October 1, 1999 through November 12, 1999, U.S. Concrete has acquired two additional operating businesses for approximately $15.3 million in cash and 550,000 shares of common stock. 9 4. SHARES USED IN COMPUTING NET INCOME (LOSS) PER SHARE The following table summarizes the number of shares (in thousands) of common stock we have used on a weighted average basis in calculating net income or loss per share:
Three Months Nine Months Ended September 30, Ended September 30, ---------------------------- ------------------------- 1999 1998 1999 1998 ------------- ------------ ---------- ----------- Shares issued to Central's owners 3,120 3,120 3,120 3,120 Shares issued to owners of acquired businesses other than Central 6,155 -- 2,782 -- Shares issued to the initial stockholders and certain management personnel of U.S. Concrete 2,853 -- 1,688 -- Shares issued in the IPO 4,370 -- 1,972 -- ------------- ------------ ---------- ----------- Number of shares used in calculating basic net income per share 16,498 3,120 9,562 3,120 Effect of shares issuable under stock options and warrants based on the treasury stock method 91 -- 74 -- ------------- ------------ ---------- ----------- Number of shares used in calculating diluted net income per share 16,589 3,120 9,636 3,120 ============= ============ ========== ===========
5. LONG-TERM DEBT A summary of long-term debt is as follows (dollars in thousands):
September 30, December 31, 1999 1998 -------------------- ------------------- Secured revolving credit facility $32,050 $ -- Notes payable to various financial institutions, secured by mixer trucks, maturing in varying amounts through May 2003, with interest ranging from 7.0% to 9.7% -- 2,860 Notes payable to various financial institutions, secured by various equipment and guaranteed by stockholders, maturing in varying amounts through September 2003, with interest ranging from 4.7% to 8.8% -- 670 Other 308 -- -------------------- ------------------- 32,358 3,530 Less: current maturities (136) (1,006) -------------------- ------------------- Long-term debt, net of current maturities $32,222 $ 2,524 ==================== ===================
On May 28, 1999, U.S. Concrete entered into a three-year $75 million revolving credit facility with a group of banks. The Company may use this facility for working capital, to finance acquisitions and for other general corporate purposes. Availability under the facility is tied to the Company's cash flow and liquidity. Advances bear interest, at the Company's option, at a prime rate or LIBOR, in each case plus a margin keyed to the ratio of the Company's indebtedness to cash flow. Commitment fees are due on any unused borrowing capacity. The facility requires the Company to maintain financial covenants regarding net worth, coverage ratios and additional indebtedness and prohibits dividends by U.S. Concrete. Subsidiary guarantees and pledges of substantially all the Company's fixed assets secure the payment of all obligations owing under the facility. 6. INCOME TAXES Prior to their respective acquisitions, Central and certain other acquired businesses were S corporations and were not subject to federal income taxes. Effective with their acquisition they became C corporations subject to those taxes, and we have recorded an estimated deferred tax liability to provide for the Company's estimated future income tax liability as a result of the difference between the book and tax bases of the net assets of these corporations. For purposes of these consolidated financial statements, federal and previously inapplicable state income taxes have been provided for the post- acquisition periods. 10 7. SEGMENT REPORTING SFAS No. 131 "Disclosures about Segments of an Enterprise and Related Information" requires that companies report separately information about each significant operating segment reviewed by the chief operating decision maker. All segments that meet a threshold of 10% of revenues, reported profit or loss, or combined assets are defined as significant segments. The Company currently operates under one segment and all operations and long-lived assets are in the United States. 11 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. U.S. CONCRETE, INC. Dated: February 7, 2000 /s/ MICHAEL W. HARLAN --------------------------------- By: Michael W. Harlan Senior Vice President -- Chief Financial Officer 12 -----END PRIVACY-ENHANCED MESSAGE-----