10-K405 1 10K-405 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ FORM 10-K (MARK ONE) /X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED] FOR THE FISCAL YEAR ENDED DECEMBER 31, 1994 OR / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] FOR THE TRANSITION PERIOD FROM TO
Commission File Number 1-4455 DOLE FOOD COMPANY, INC. ______(Exact name of registrant as specified in its charter)______ HAWAII 99-0035300 (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification number)
31355 OAK CREST DRIVE WESTLAKE VILLAGE, CALIFORNIA 91361 (Address of principal executive offices) Registrant's telephone number, including area code: (818) 879-6600 Securities registered pursuant to Section 12(b) of the Act: NAME OF EACH EXCHANGE ON WHICH REGISTERED TITLE OF EACH CLASS ------------------------------- --------------------------------------- Common Stock, No Par Value New York Stock Exchange Pacific Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark whether 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 by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive Proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendments to this Form 10-K. /X/ The aggregate market value of the voting stock held by non-affiliates of the registrant as of March 17, 1995 was approximately $1,620,846,568. The number of shares of Common Stock outstanding as of March 17, 1995 was 59,480,608. DOCUMENTS INCORPORATED BY REFERENCE Portions of the registrant's 1994 Annual Report to Stockholders for the year ended December 31, 1994 are incorporated by reference into Parts I, II and IV. Portions of the registrant's definitive Proxy Statement for its 1995 Annual Meeting of Stockholders are incorporated by reference into Part III. -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- DOLE FOOD COMPANY, INC. FORM 10-K FISCAL YEAR ENDED DECEMBER 31, 1994 TABLE OF CONTENTS
ITEM NUMBER IN FORM 10-K PAGE -------------------------------------------------------------------------------------------------------- ------------- PART I 1. Business..................................................................................... 1 2. Properties................................................................................... 9 3. Legal Proceedings............................................................................ 11 4. Submission of Matters to a Vote of Security Holders Executive Officers of the Registrant....................................................... 12 PART II 5. Market for the Registrant's Common Equity and Related Stockholder Matters.................... 13 6. Selected Financial Data...................................................................... 13 7. Management's Discussion and Analysis of Financial Condition and Results of Operations........ 13 8. Financial Statements and Supplementary Data.................................................. 13 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure......... 13 PART III 10. Directors and Executive Officers of the Registrant........................................... 14 11. Executive Compensation....................................................................... 14 12. Security Ownership of Certain Beneficial Owners and Management............................... 14 13. Certain Relationships and Related Transactions............................................... 14 PART IV 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K.............................. 14 (a) 1. Index to Financial Statements........................................................ 14 2. Index to Financial Statement Schedules.................................................... 14 3. Index to Exhibits......................................................................... 15 (b) Reports on Form 8-K..................................................................... 16 Signatures.............................................................................................. 17 Financial Statements and Financial Statement Schedules.................................................. F- - F-
ii PART I ITEM 1. BUSINESS Dole Food Company, Inc. was founded in Hawaii in 1851 and was incorporated under the laws of Hawaii in 1894. Unless the context otherwise requires, Dole Food Company, Inc. and its consolidated subsidiaries are referred to herein as the "Company". The Company's principal executive offices are located at 31355 Oak Crest Drive, Westlake Village, California 91361, telephone (818) 879-6600. At December 31, 1994, the Company had approximately 46,000 full-time employees worldwide. The Company is engaged in three principal businesses: food production and distribution, real estate development, and resorts. The Company is one of the largest companies engaged in the worldwide sourcing, processing, distributing and marketing of high quality, branded food products. The Company's food operations are conducted through the Company's food group ("Dole"), which sources, grows, processes and markets fruits, vegetables, nuts and juices in the following locations: North America; Latin America, principally Chile, Colombia, Costa Rica, Ecuador, Honduras and Panama; Asia, principally Japan, the Philippines and Thailand; and Europe, principally Germany, France and Italy. The Company's real estate operations are primarily conducted under the "Castle & Cooke" name through the Company's real estate group which holds, develops, operates and sells residential, commercial, industrial and retail properties in Hawaii, California, Arizona, North Carolina, Georgia and Mississippi. In December 1994, the Company completed a tender offer for the publicly traded shares of its homebuilding and residential development subsidiary, Castle & Cooke Homes, Inc. The Company's resort operations are located on the Hawaiian Island of Lana'i and include two luxury resorts: The Lodge at Koele and The Manele Bay Hotel. The Company's food, real estate development and resort operations are described below. For detailed financial information with respect to the revenue, operating income and assets of the Company's food products, real estate and resort segments, and its operations in various geographic areas, see the Company's Consolidated Financial Statements and the related Notes to Consolidated Financial Statements, which are included in its 1994 Annual Report for the fiscal year ended December 31, 1994 (the "Dole Annual Report") and incorporated by reference in Part II of this report. FOOD GENERAL Dole is engaged in the worldwide sourcing, processing, distributing and marketing of high quality branded food products. Dole provides retail and institutional customers and other food product companies with high quality products bearing the DOLE-Registered Trademark- name which are produced and improved through research, agricultural assistance and advanced harvesting, processing, packing, cooling, shipping and marketing techniques. Dole is one of the world's largest producers of bananas and pineapples. Dole is also a major marketer of citrus and table grapes worldwide and an industry leader in iceberg lettuce, celery, cauliflower and broccoli. Dole is the second largest processor of California raisins and processes significant amounts of California's almond, pistachio and date crops. On March 7, 1995, the Company signed a letter of intent to sell its California-based raisin, date and prune business to Sun-Diamond Growers of California, a grower cooperative, for approximately $100 million. It is a major participant in the chilled, shelf-stable and frozen juice markets with DOLE-Registered Trademark- 100% pineapple juice and 100% blended juice varieties. On January 5, 1995, the Company signed a letter of intent to sell its worldwide juice business (except for the canned pineapple juice business) to The Seagram Company Ltd., owner of Tropicana Products, Inc., for approximately $285 million. Dole's fresh food products are produced both directly on Company-owned or leased land and through associated producer and independent grower arrangements pursuant to which Dole provides varying degrees of farming, harvesting, packing, storing, shipping, stevedoring and marketing services, as well as financing through advances to growers of certain products. Fresh fruit and vegetable products, dried fruit and nuts and processed pineapple products are, for the most part, packed and/or processed directly by Dole. 1 Other processed foods, such as fruit juices, are obtained through co-production arrangements with independent manufacturers. Co-producers manufacture these products pursuant to strict specifications and under Company supervision designed to ensure consistently high product quality. Dole utilizes product quality, brand recognition, competitive pricing, effective customer service and consumer marketing programs to enhance its position within the highly competitive food industry. Consumer and institutional recognition of DOLE-Registered Trademark- and related brands and the association of these brands with high quality food products contribute significantly to Dole's ability to compete in the markets for fresh fruit and vegetables, packaged foods and dried fruit and nuts. The Company owns these trademarks in the United States, Canada and in other countries in which it conducts business and regards them as important corporate assets with high recognition and acceptance. The markets for all of Dole's products are highly competitive. In order to compete successfully, Dole sources products of high quality and seeks to distribute them in worldwide markets on a timely basis. Dole's competitors in the fresh fruit business include a limited number of large international food distribution companies, as well as a large number of smaller independent distributors, including grower cooperatives and foreign government-sponsored producers which have intensified competition in recent years. With respect to vegetables, a limited number of grower-shippers in the United States and Mexico supply a significant portion of the domestic fresh produce market. However, numerous smaller independent distributors also compete with Dole in the market for fresh vegetables. With respect to packaged products, Dole competes against a number of large U.S. companies, as well as a substantial number of smaller independent canners; Dole's processed pineapple also competes against a significant volume of product processed abroad by foreign competitors. Dole's citrus and dried fruit and nut products compete in North America primarily against large grower cooperatives with strong brand recognition. Dole's earnings from its fresh fruit, vegetable and dried fruit and nut operations, and its packaged foods operations are sensitive to fluctuations in the volatile market prices for these products. Excess supplies often cause severe price competition. Growing conditions in various parts of the world, particularly weather conditions such as floods, droughts and freezes, and diseases and pests are primary factors affecting market prices because of their influence on supply and quality of product. Other factors affecting Dole's operations include the seasonality of its supplies, the ability to process products during critical harvest periods, the timing and effects of ripening, the degree of perishability, the effectiveness of worldwide distribution systems, the terms of various federal and state marketing orders (particularly for dried fruit, nuts and citrus), total worldwide industry volumes, the seasonality of consumer demand, foreign currency exchange fluctuations, foreign importation restrictions and foreign political risks. PRODUCTS Dole sources, distributes and markets fresh fruit products including bananas, pineapples, table grapes, apples, pears, plums, oranges, grapefruit, lemons, mangos, kiwi, tangelos, melons, cherries and other deciduous, tropical and citrus fruits. Dole sources, harvests, cools, distributes and markets approximately 25 different types of fresh vegetable products, including iceberg lettuce, red and green leaf lettuce, romaine lettuce, butter lettuce, celery, cauliflower, green cauliflower, broccoli, carrots, brussels sprouts, spinach, red and green onions, asparagus, snow peas, artichokes, strawberries and raspberries. Dole also markets value-added products such as iceberg lettuce based salad mixes, complete salad kits which include dressing and condiments, blends of specialty lettuces, red and green cabbage, mini peeled carrots, coleslaw, vegetable combinations and broccoli and cauliflower florets. Dole sources, processes and markets raisins, dates, prunes, almonds, pistachios and trail mixes. Dole's fresh fruit and vegetable products and its consumer dried fruit and nut products are marketed under the DOLE-Registered Trademark- brand, under other brand names owned by the Company, and, in some cases, under private labels. 2 Dole produces and markets processed food products including sliced, chunk, tidbit and crushed pineapple in cans, as well as tropical fruit salad, and markets mandarin oranges. Dole also markets DOLE-Registered Trademark- juice drinks and DOLEWHIP-Registered Trademark- soft-serve, non-dairy dessert. Dole's products are marketed through 27 direct selling offices in North America, 19 in Europe, four in Japan, one each in Hong Kong, Korea, the Middle East, the Philippines and Taiwan, as well as through independent brokers. DOLE NORTH AMERICA DOLE NORTH AMERICA sources, distributes and markets DOLE-Registered Trademark- fresh fruits and vegetables, dried fruit and nuts and other processed food products, including processed pineapple, juices and juice concentrates, in North America. Dole North America markets bananas grown in Latin America, table grapes grown in the United States, Chile and Mexico, apples and pears grown in the United States and Chile, melons grown in Ecuador and citrus fruit grown in the United States, as well as other deciduous and tropical fruit grown in the United States, Chile, Costa Rica, Mexico and New Zealand. Fresh pineapple destined for North America is grown by Dole North America in Hawaii. These products are sold primarily to wholesalers and retail chains, which in turn resell or distribute them to retail food stores. Fresh vegetables marketed by Dole are generally grown by independent growers in California, Arizona, Colorado and northern and central Mexico. The vegetables are generally field packed and transported to Dole's central cooling and distribution facilities. The products are sold to customers in North America, Asia and Western Europe. Dole has an agreement with Nestle Dairy Systems, Inc., a subsidiary of Nestle USA, Inc., in which Dole has licensed to Nestle its rights to market and manufacture processed products in key segments of the frozen novelty business in the United States and Canada, including FRUIT 'N JUICE-REGISTERED TRADEMARK-, SUNTOPS-TM-, FRESH LITES-REGISTERED TRADEMARK-, FRUIT 'N YOGURT-TM- and FRUIT 'N CREAM-TM- bars and, in the premium novelty category, Fruit Sorbet. Dried fruit and nut products are sourced from independent growers and, to a lesser extent, produced by Dole North America. They are packaged for the retail consumer and in bulk for cereal, confectionery and other food processors and for food service use. Raisins are acquired from growers and dehydrators located in the San Joaquin Valley of California. These products are marketed domestically and overseas, primarily in Western Europe and Asia. Approximately 60% of all production is sold to other food processors for eventual use in other food products. Raisins account for the largest portion of dried fruit and nut sales. On January 5, 1995, the Company signed a letter of intent to sell its worldwide juice business (except for the canned pineapple juice business) to The Seagram Company Ltd., owner of Tropicana Products, Inc., for approximately $285 million. On March 7, 1995, the Company signed a letter of intent to sell its California-based raisin, date and prune business to Sun-Diamond Growers of California, a grower cooperative, for approximately $100 million. DOLE LATIN AMERICA DOLE LATIN AMERICA sources and transports bananas grown in Costa Rica, Colombia, Ecuador, Guatemala, Honduras, Nicaragua and Panama for markets principally in North America, Europe and the Mediterranean. Fresh pineapples destined for the North American and Western European markets are grown by Dole Latin America on plantations in Honduras and the Dominican Republic and sourced from independent producers in Costa Rica. Dole Latin America sources table grapes, apples, pears and other deciduous fruit grown in Chile, melons grown in Ecuador, citrus fruit grown in Honduras and Argentina, and mangoes from Mexico, Peru and Venezuela for markets in North America, Western Europe and Asia. 3 Dole operates a fleet of approximately 33 refrigerated vessels, of which 14 are Company-owned and the remainder are chartered. From time to time, excess capacity may be chartered or subchartered to others. In January 1995 Dole took delivery of the last of four new breakbulk refrigerated vessels built by a Polish shipbuilder. Dole Latin America conducts other food and beverage operations in Honduras, including an approximately 80% interest in a beer and soft drink bottling operation, a bottle crown plant, a plastic injection facility used primarily for the manufacture of beer and soft drink plastic cases, a sugar mill and sugar cane plantations, as well as a majority interest in an edible oils refinery, a laundry soap factory, a palm oil extraction operation and a palm oil plantation. The beer and soft drink bottling operation, which sells its products primarily in Honduras, competes against other local soft drink bottlers. Competition focuses on product quality, consumer marketing programs and the effectiveness of the distribution system. DOLE ASIA Bananas and pineapples grown in the Philippines are transported to markets principally in Asia and the Middle East. Pineapples used for processed products are grown primarily in Thailand and the Philippines. DOLE ASIA also sources DOLE-Registered Trademark- and Mountain-Registered Trademark- asparagus from the Philippines and distributes and markets these products in Japan and other Asian countries. Snow Dole Co., Ltd., a joint venture of Dole and Snow Brand Milk Products Co., Ltd. of Japan, processes and distributes a full line of 100% fruit juices, frozen desserts and canned pineapple in Japan. The juice component of this joint venture is part of the Company's proposed sale of its juice business to The Seagram Company Ltd., owner of Tropicana Products, Inc. Dole Asia, with joint venture partners, is developing citrus orchards and juice processing facilities in mainland China. The juice processing facility is part of the Company's proposed sale of its juice business to The Seagram Company Ltd., owner of Tropicana Products, Inc. Dole Asia also produces leather-leaf ferns, anthuriums and other tropical flowers in the Philippines for export to Japan. The winding down of Dole Asia's shrimp farming operation in the Philippines is continuing. DOLE EUROPE DOLE EUROPE is a major importer of bananas and other fresh fruits, dried fruits, nuts, canned fruits and juices in Europe and the Near East. Dole Europe operates four regional banana ripening and distribution companies in France which complement the Company's investment in the largest French banana producer, with banana plantations in Cameroon, import operations in France and Spain, and banana ripening in seven regional facilities in France and three in Spain. Dole Europe is a minority partner with the Jamaican Producer Group (the largest banana producer in Jamaica), in the Jamaican Producers Fruit Distributors Ltd. in the United Kingdom. This banana ripening and fruit distribution company operates five facilities in the United Kingdom. This joint venture distributes Dole fresh fruits and bananas as well as Jamaican bananas, fruits and vegetables direct to retail in the UK. Dole Europe is the majority partner, with the Livorno Stevedore Company C.I.L.P., in a major port discharge and distribution facility in the Italian port of Livorno. This facility provides reefer container service utilizing feeder vessels to distribute fruit to Mediterranean markets. A distribution facility in Turkey is under construction. Dole Europe operates a European dried fruit and nut business which sources products from around the world for processing and packaging in France and distribution in France and to other European markets. This business distributes a line of dried fruit and nut products sold throughout Europe. In 1994, Dole purchased a prune processor, packer and distributor in France. These businesses are not part of the Company's proposed sale of its California-based raisin, date and prune business to Sun-Diamond Growers of California. 4 The Company owns affiliated fruit juice businesses which produce and distribute juice products in Europe and the United States under the Looza-Registered Trademark-, Fruvita-Registered Trademark- and Juice Bowl-Registered Trademark- brands. Looza-Registered Trademark- is a leader in shelf-stable juices and nectars in its market sector. Fruvita-Registered Trademark- is the leader in the chilled fruit juice category in continental Europe. Juice Bowl-Registered Trademark- brand juice products are distributed in the United States. These businesses are part of the Company's proposed sale of its juice business to The Seagram Company Ltd., owner of Tropicana Products, Inc. RESEARCH AND DEVELOPMENT Dole's research and development programs concentrate on the development of new value-added products and new uses for existing products, as well as agricultural research and packaging design for improving product quality. New product development and packaging research activities are conducted primarily at Dole's research technical center in San Jose, California. Agricultural research is directed toward improving product yields and product quality by examining and improving agricultural practices in all phases of production (such as development of specifically adapted plant varieties, land preparation, fertilization, cultural practices, pest and disease control, and post-harvesting, packing, and shipping procedures), and includes on-site technical services and the implementation and monitoring of recommended agricultural practices. Specialized machinery is also developed for various phases of agricultural production and packaging which reduces labor, improves productivity and efficiency and increases product quality. Agricultural research is conducted at field facilities primarily in California, Hawaii, Latin America and Asia. FOREIGN OPERATIONS Dole has significant food sourcing and related operations in Chile, Colombia, Costa Rica, the Dominican Republic, Ecuador, Honduras, the Philippines and Thailand. Dole also sources food products in Algeria, Argentina, Australia, Cameroon, China, Greece, Guatemala, Italy, Ivory Coast, Mexico, New Zealand, Nicaragua, Panama, Peru, Spain, Syria, Tunisia, Turkey and Venezuela. Significant volumes of Dole's fresh fruit and packaged products are marketed in Canada, Western Europe and Japan, with lesser volumes marketed in New Zealand, Hong Kong, South Korea, Australia and certain countries in Asia, Eastern Europe, Scandinavia, the Middle East and Central and South America. Exports of Dole's products to these countries, particularly Japan, South Korea and Taiwan, are subject to various restrictions which may be increased or reduced in response to international political pressures, thus affecting Dole's ability to compete in these markets. Some of Dole's dried fruit and nut products are marketed to Asia and Western Europe. The European Union ("EU") banana regulations which impose quotas and tariffs on bananas were in full effect in 1994 and continue to be in effect in 1995. In addition, beginning in 1995, four Latin American countries (Costa Rica, Colombia, Nicaragua and Venezuela) will implement an agreement with the EU to receive a guaranteed share of the import quotas. Regulations governing this agreement are expected to be published in the first quarter of 1995 and could result in higher costs of operations for the Company due to additional license requirements and export fees that may be imposed. As part of the agreement, the basic EU import quota will be increased 10% and the tariff decreased approximately 35%. The EU quota will receive a second increase to accommodate an additional 20 million consumers when Norway, Sweden and Austria join the EU effective January 1995. Regulations governing the issuance of licenses to control this new volume are also expected to be published in the first quarter of 1995. The net impact of these changing regulations on Dole's future results of operations is not determinable at this time. Dole's foreign operations are subject to risks of expropriation, civil disturbances, political unrest, increases in taxes and other restrictive governmental policies, such as import quotas. Loss of one or more of its foreign operations could have a material adverse effect on Dole's operating results. Dole attempts to maintain a cordial working relationship in each country where it operates. Because Dole's operations are a significant factor in the economies of certain countries, its activities are subject to intense public and governmental scrutiny, and may be affected by changes in the status of the host economies, the makeup of the government or even public opinion in a particular country. Dole's international sales are usually transacted in U.S. dollars and major European and Asian currencies, while many of its costs are incurred in currencies different from those that are received from the sale of the product. As the Company has not 5 historically entered into forward foreign exchange contracts, results of operations may be significantly affected by fluctuations in currency exchange rates in both the sourcing and selling locations. The overall net impact of foreign currency fluctuations was immaterial to the results of operations in 1993 and 1994. ENVIRONMENTAL AND REGULATORY MATTERS Dole's agricultural operations are subject to a broad range of evolving environmental laws and regulations in each country in which it operates. In the United States, these laws and regulations include the Clean Air Act, the Clean Water Act, the Resource Conservation and Recovery Act, the Federal Insecticide, Fungicide and Rodenticide Act and the Comprehensive Environmental Response, Compensation and Liability Act. Compliance with these foreign and domestic laws and related regulations is an ongoing process which is not currently expected to have a material effect on Dole's capital expenditures, earnings or competitive position. Environmental concerns are, however, inherent in most major agricultural operations, including those conducted by Dole, and there can be no assurance that the cost of compliance with environmental laws and regulations will not be material. Moreover, it is possible that future developments, such as increasingly strict environmental laws and enforcement policies thereunder, and further restrictions on the use of agricultural chemicals could result in increased compliance costs. Dole's food operations are also subject to regulations enforced by, among others, the U.S. Food and Drug Administration and state, local and foreign equivalents and to inspection by the U.S. Department of Agriculture and other federal, state, local and foreign environmental and health authorities. Among other things, the U.S. Food and Drug Administration enforces statutory standards regarding the branding and safety of food products, establishes ingredients and manufacturing procedures for certain foods, establishes standards of identity for foods and determines the safety of food substances in the United States. Similar functions are performed by state, local and foreign governmental entities with respect to food products produced or distributed in their respective jurisdictions. Several of Dole's products, including but not limited to dried fruit, nuts and citrus fruit, are or in the future may be subject to, federal and state marketing orders which may affect the quantities of such products that can be sold at any one time, the amount of such products that must be held in reserve, the manner in which such products can be processed, quality standards for such products and various other matters relating to the marketing and sale of such products. SOURCES AND AVAILABILITY OF RAW MATERIALS The major raw material and operating supplies used by Dole are seed and other planting materials, fuels for transportation, agricultural chemicals, packaging materials and tinplate. Generally, all of these items are readily available from a number of sources; however, operations would be affected by any substantial reductions in supply. REAL ESTATE The Company conducts real estate activities, including residential, commercial and/or industrial real estate projects, in Hawaii, California, Arizona, North Carolina, Georgia and Mississippi. The Company generally competes against a number of large, well-capitalized real estate developers for residential, commercial and industrial projects. The Company competes for residential sales with other developers, homebuilders and individuals reselling existing residential housing in the greater metropolitan areas in which it conducts business. The Company competes primarily on the basis of location, prices, quality and design. The Company also competes with other developers and homebuilders for desirable properties, financing, raw materials and skilled labor. The Company's real estate operations are subject to a variety of risks including increases in mortgage interest rates, shifts in population, real estate market fluctuations, changes in the desirability and preferences for residential, commercial and industrial areas, and the effects of changes in tax laws. Land use planning, management and development are also subject to local zoning, economic and political constraints. 6 RESIDENTIAL REAL ESTATE OPERATIONS In December 1994, the Company completed a tender offer for the publicly traded shares of Castle & Cooke Homes, Inc. ("CKI"), its homebuilding and residential development subsidiary. Prior to completion of the tender offer, the Company owned approximately an 82% interest in CKI, which was listed on the New York Stock Exchange under the symbol "CKI". In Hawaii, Mililani Town, located in central Oahu, is being developed as a 3,500-acre master-planned community, complete with homes, parks, recreation centers, schools, shopping centers and a library. In Mililani Makai, the first section of the community to be developed, approximately 9,300 units on approximately 2,300 acres of land have been sold. Mililani Mauka is the section of Mililani Town now undergoing development; current plans call for the development of approximately 6,600 units on 1,200 acres over the next eight years. The necessary land use and zoning approvals for the first phase of 4,500 units on approximately 790 acres in Mililani Mauka have been received, and approximately 1,665 units have been built and sold through December 31, 1994. Other active Hawaii developments include Royal Kunia and The Crowne at Wailuna. Royal Kunia is a 270-acre master-planned community to be built on the Ewa Plain in central Oahu. Royal Kunia is owned by a limited partnership in which a wholly-owned subsidiary of the Company is the sole general partner and holds a 50% interest. The development, when completed in accordance with the master plan, will offer single-family and multi-family housing adjacent to commercial properties, parks and recreational facilities. The master plan provides for 1,748 units, of which 160 were sold in 1994. The Crowne at Wailuna is the fourth and final phase of a planned residential community above Pearl City on the island of Oahu. This 26-acre parcel was purchased by the Company in 1993. It is planned to include 158 detached homes developed under condominium ownership. Construction is currently underway. As of December 31, 1994, 30 units had been sold. In December 1994, the Company purchased the Kaluanui 1 parcel, an approximately 22-acre site in Hawaii Kai in East Oahu. The Company is entitled to develop up to 290 units on the parcel. The project is currently undergoing design development to include townhouses and flats under fee simple condominium ownership. Construction is anticipated to start in late 1995, with first deliveries anticipated in early 1996. In Bakersfield, California, planned residential communities are being developed on approximately 4,840 acres. The property was in various stages of development when acquired in late 1987. Approximately 1,305 acres are currently zoned for development, portions of which have been master-planned and subdivided, with roadways and utilities constructed to each subdivision. In Bakersfield, lots are sold to independent builders for single family projects, and homes are also sold in a few developments. Current residential development activities in Bakersfield include Silver Creek, Seven Oaks, Brimhall, The Oaks and Haggin Oaks. Silver Creek is a master-planned community encompassing approximately 600 acres. Homes and homesites are offered at three price levels. Approximately 1,120 homes and homesites remain to be developed on approximately 420 acres. Seven Oaks is a master-planned community on approximately 1,000 acres and is designed to be the premier residential development in Bakersfield. Seven Oaks surrounds an 18-hole golf course and country club developed by the Company, which will be contributed to a nonprofit mutual benefit corporation. The Company sells homesites in Seven Oaks. Approximately 1,275 home and homesites on approximately 500 acres remain to be developed. Brimhall is a 285-acre residential community designed to attract entry-level, middle-market and custom homebuyers. Development commenced in 1991. An additional 940 acres are currently being master-planned to complete the Brimhall community. The Company currently plans to develop approximately 4,040 homesites on the approximately 1,200 remaining acres. Other developments include The Oaks and Haggin Oaks in Bakersfield, California, and Sierra Vista, Arizona. Approximately 240 single family lots remain to be developed in The Oaks and an additional 63 7 single family lots in Haggin Oaks. The Sierra Vista, Arizona project contains single-family and multi-family homesites for sale to builders and individuals. Approximately 3,500 homesites remain to be developed on approximately 1,280 acres. In March 1995, the Company sold a 320-unit apartment complex in Bakersfield that it had developed to a third party. The Company also owns and operates a 192-unit apartment complex in Charlotte, North Carolina, a 360-unit apartment complex in Jackson, Mississippi, a 204-unit apartment complex in Southaven, Mississippi, and a 252-unit apartment complex in Horn Lake, Mississippi. COMMERCIAL, INDUSTRIAL AND RETAIL REAL ESTATE OPERATIONS The Company's commercial, industrial and retail real estate operations are conducted through wholly-owned subsidiaries of the Company. In Hawaii, the Company is constructing a shopping center in Mililani Town on approximately 40 acres, of which approximately 400,000 square feet of building space have been completed, including Hawaii's first Walmart store. In addition, the Company is developing Mililani Technology Park, a 256-acre, campus-like business/research office park currently zoned and designed primarily for high technology companies. As of December 31, 1994, 49 acres had been sold. The Company also operates a Company-owned mixed-use complex at Dole's former cannery facility in Honolulu and a tourist attraction at Dole's pineapple plantation in central Oahu. In Bakersfield, California, the Company has three industrial parks in various stages of development. The Company also owns two office buildings, a 150,000 square foot industrial warehouse and a 50% general partnership interest in a partnership owning a shopping center. The Company also owns and operates a 188,000 square foot commercial office building in Atlanta, Georgia, a 167,000 square foot commercial office building in Raleigh, North Carolina, a 81,000 square foot commercial office building in Raleigh, North Carolina and a 62,000 square foot commercial office building in Tempe, Arizona. The construction work conducted by the Company's residential, commercial, industrial and retail real estate operations is largely performed by independent contractors, subcontractors and suppliers, and the materials and supplies are secured by these contractors, subcontractors and suppliers from customary trade sources. Although certain products are subject to supply limitations from time to time, such limitations have not significantly impaired the Company's ability to conduct its business in the past. RESORTS The Company owns and operates two luxury hotels on the Hawaiian island of Lana'i. The Lodge at Koele is a two story, 102-room luxury lodge set in the wooded highlands of Koele, Lana'i. It includes an 18-hole golf course called The Experience at Koele. The Manele Bay Hotel is a luxury, oceanfront hotel with 249 guest rooms and suites. A conference center for The Manele Bay Hotel was completed in 1992. The Challenge at Manele, an 18-hole golf course immediately adjacent to The Manele Bay Hotel, was completed in 1993. The Company is also planning to develop the property contiguous to the Lodge and golf course sites on Lana'i as residential homesites. The Company began marketing golf course frontage townhomes and single family lots at Koele in early 1995. Development of homesites at Manele is awaiting final land use and zoning approvals. The Company's resort operations are subject to the risks of changes in the desirability and preference for resort areas and economic and local political constraints. ENVIRONMENTAL AND REGULATORY MATTERS The Company's real estate and resort operations are subject to a broad range of evolving federal, state and local environmental laws and regulations. Management is not currently aware of any environmental compliance issues that are expected to have a material effect on the Company's capital expenditures, earnings or competitive position. 8 ITEM 2. PROPERTIES The Company maintains executive offices in Westlake Village, California and auxiliary executive offices in Los Angeles, California and New York, New York, each of which is leased from third parties. Dole's various divisions also maintain headquarters offices in Westlake Village and Salinas, California, which are leased from third parties, and in Fresno, California, Wahiawa, Hawaii and Wenatchee, Washington, which are owned by the Company. The Company owns the headquarters building of Dole Fresh Fruit International, Limited in Costa Rica, as well as offices in Colombia and Honduras. Dole Europe maintains its European headquarters in Paris, France as well as regional offices in Hamburg, Germany, Brussels, Belgium, Genoa, Italy and Istanbul, Turkey, which are leased from third parties. In addition, the Company's Hawaii real estate operations maintain offices in Honolulu, Hawaii in a building which is owned by the Company. The Company's California real estate operations and its California fresh fruit and citrus operations are headquartered in Bakersfield, California in a building owned by the Company. The Company's resort operations maintain offices on the Island of Lana'i in buildings owned by the Company. The inability to renew any of the above office leases by the Company would not have a material adverse effect on the Company's operating results. The Company and each of its subsidiaries believe that their property and equipment are generally well maintained, in good operating condition and adequate for their present needs. The following is a description of the food and real estate operations' significant properties. DOLE DOLE NORTH AMERICA Dole's Hawaii pineapple operations for the fresh produce market are located on the island of Oahu and total approximately 7,000 acres owned by the Company. Dole produces citrus on approximately 11,000 acres in the San Joaquin and Coachella Valleys of California owned directly, through agricultural partnerships or under management arrangements, as well as through independent growing arrangements. Dole also provides care and management services for approximately 9,000 citrus acres in Florida. Citrus is packed in seven Company-owned or leased packing houses -- five in California, one in Florida and one in Arizona. Dole, through a joint venture, operates a 175,000 square foot packing house in southwest Florida with two multi-variety production lines. Domestic table grapes are sourced from approximately 6,000 acres on four Company-owned vineyards, one located in the Coachella Valley and three located in the San Joaquin Valley. Domestic table grapes are fumigated and cooled in three Company-owned facilities, two are located in the San Joaquin Valley and one is located in the Coachella Valley. Dole produces wine grapes on approximately 2,000 acres of vineyards, and stone fruit on approximately 800 acres of Company-owned property in the San Joaquin Valley. The Company owns a cherry packing and processing facility in Victor, California. Dole produces apples and pears directly from seven Company-owned orchards on approximately 1,800 productive acres in Wenatchee and Chelan, Washington as well as through independent growing arrangements. The Company also owns apple and pear storage, processing and packing facilities in Wenatchee and Chelan. The Company owns approximately 1,400 acres of farmland in California and Arizona, and leases approximately 11,400 acres of farmland in California and another 5,300 acres in Arizona in connection with Dole's vegetable operations. The majority of this acreage is farmed under joint growing arrangements with independent growers, while the remainder is farmed by Dole. The Company owns cooling, packing and shipping facilities in Yuma, Arizona and the following California cities: Marina, Holtville, Guadalupe, Gonzales and Huron. Additionally, the Company has partnership interests in facilities in Yuma, Arizona and Mexico, and leases facilities in Oxnard, California. The Company owns state-of-the-art, value-added processing plants in Yuma, Arizona and Soledad, California. Dole produces almonds from approximately 4,200 acres and pistachios from approximately 3,100 acres of orchards in the San Joaquin Valley, owned directly or through agricultural partnerships or leased. The Company leases approximately 50 acres of date gardens in the Coachella Valley. 9 The Company owns and operates one almond processing and packing plant, three almond receiving and storage facilities, one pistachio processing plant and two raisin and prune processing plants, all of which are located in the San Joaquin and Sacramento Valleys. The Company owns and operates a date processing plant in the Coachella Valley. Hawaii sugar operations include a mill which produces raw sugar and a plantation on the island of Oahu, although a phase-out of this operation was announced in 1994. Approximately 12,000 acres (approximately 6,100 acres of which are owned and the remainder of which are leased) are used for crops. Portions of the Company's fresh fruit and vegetable farm properties are irrigated by surface water supplied by local government agencies using facilities financed by federal or state agencies, as well as from underground sources. Water received through federal facilities is subject to acreage limitations under the 1982 Reclamation Reform Act. The quantity and quality of these water supplies varies depending on weather conditions and government regulations. The Company believes that under normal conditions these water supplies are adequate for current production needs. DOLE LATIN AMERICA Dole produces bananas directly from Company-owned plantations in Costa Rica, Colombia and Honduras as well as through associated producers or independent growing arrangements in those countries and in Ecuador, Guatemala, Panama and Nicaragua. The Company owns approximately 40,400 acres in Honduras, 32,400 acres in Costa Rica and 3,600 acres in Colombia. Dole also grows pineapple on approximately 6,000 acres of owned land in Honduras, primarily for the fresh produce market, and owns a juice concentrate plant in Honduras for pineapple and citrus. Dole grows pineapple on approximately 11,000 acres of leased land in the Dominican Republic and owns a juice concentrate plant located adjacent to the leased acreage. Dole produces citrus on approximately 650 acres of Company-owned land and operates a grapefruit packing house in Honduras. Dole also produces grapes, stonefruit, kiwi and pears on approximately 900 acres in Chile. Dole operates Company-owned corrugated box plants in Chile, Colombia, Costa Rica, Ecuador and Honduras. The Company has an interest in the following properties in Honduras: an approximately 80% interest in a beer and soft drink bottling operation, a bottle crown plant, a plastic injection facility used primarily for the manufacture of beer and soft drink plastic cases and a sugar mill, as well as a majority interest in an edible oils refinery, a laundry soap factory, a palm oil extraction operation and 3,400 acres of palm oil plantation. Dole operates a fleet of approximately 33 refrigerated vessels, of which 14 are Company-owned and the remainder are chartered. From time to time, excess capacity may be chartered or subchartered to others. Dole enters into spot charters as necessary to supplement its transportation resources. In January 1995, Dole took delivery of the last of four new breakbulk refrigerated vessels built by a Polish shipbuilder. DOLE ASIA Dole operates a pineapple plantation of approximately 30,200 acres in the Philippines. Originally covered by a grower agreement between Dole and a government-owned and controlled corporation, approximately 22,100 acres of the plantation have been transferred to a cooperative of Dole employees that will acquire the land pursuant to an agrarian reform law. The remaining acreage in the Philippines is farmed pursuant to farm management contracts. A cannery, chillroom, juice concentrate plant, corrugated box plant and can manufacturing plant, each owned by Dole, are proximately located to the plantation. Through a subsidiary in Thailand controlled by Dole, Dole grows pineapple on approximately 5,000 acres of leased land and purchases additional supplies of pineapple in Thailand on the open market. Dole's Thailand subsidiary owns and operates a cannery, can plant and juice concentrate plant located adjacent to the leased acreage in central Thailand, and a second multi-fruit cannery in southern Thailand. 10 Dole also produces bananas through associated producers or independent growing arrangements in the Philippines, and, with a joint venture partner, is developing approximately 6,400 acres of citrus orchards in China. DOLE EUROPE Dole owns four banana ripening and fruit distribution facilities in France and one in Barcelona, Spain. The Company has an interest in a French company which has seven banana ripening and fruit distribution facilities in France and three in Spain. This French company owns a majority interest in banana plantations in Cameroon and pineapple plantations in Ivory Coast, with banana producing joint interests in Ivory Coast. Dole owns an interest in a United Kingdom banana ripening and fruit distribution company with five facilities in the United Kingdom. Dole Europe is the majority owner in a port terminal and marine distribution facility in Livorno, Italy. The Company owns land and has begun construction of a banana ripening and fruit distribution facility in Istanbul, Turkey. Dole owns two affiliated fruit juice companies which have production facilities in Belgium, France and Florida. These companies are part of the Company's proposed sale of its juice business to The Seagram Company Ltd., owner of Tropicana Products, Inc. In France, the Company owns a dried fruit and nut processing, packaging and warehousing facility in Vitrolles, a date processing and packing plant in Marseille and a prune processing and packaging plant in Agen. These facilities are not part of the Company's proposed sale of its California-based raisin, date and prune business to Sun-Diamond Growers of California. REAL ESTATE AND RESORTS The Company owns an aggregate of approximately 129,000 acres of land in Hawaii. Of that total, approximately 40,400 acres are located on the island of Oahu, of which approximately 13,600 acres currently are used for the cultivation of pineapple, approximately 12,000 acres are leased or rented to approximately 94 tenants and approximately 5,600 acres are held for real estate development. Approximately 88,600 acres are located on the Island of Lana'i, of which the Company uses approximately 1,300 acres for resort and residential development. In addition, approximately 15,100 acres on Lana'i are being used or are available for diversified agricultural operations, including pasture land for livestock. In California, the Company owns approximately 10,950 acres, including approximately 3,200 acres near San Jose, 7,400 acres near Bakersfield and 350 acres at the Mountaingate development in West Los Angeles. The Company also owns approximately 6,800 acres in Cochise County, Arizona. The Company also owns and operates four office buildings located in North Carolina, Georgia and Arizona, and three apartment complexes located in Mississippi and one apartment complex located in North Carolina. ITEM 3. LEGAL PROCEEDINGS Lawsuits have been filed in Texas against the manufacturers of a formerly widely used agricultural chemical called DBCP and against the Company. Plaintiffs are foreign nationals who claim they were employees or independent contract growers of Company subsidiaries during the 1970's. Damages are claimed for alleged personal injuries caused by contact with DBCP approximately 15 to 20 years ago. The Company has denied liability and asserted substantial defenses. Similar lawsuits with a different group of plaintiffs have been settled. The portion paid by the Company was covered by insurance and immaterial to the Company. In the opinion of management, after consultation with outside counsel, these pending lawsuits are not expected to have a material adverse effect on the Company. The Company is involved from time to time in other various claims and legal actions incident to its operations, both as plaintiff and defendant. In the opinion of management, after consultation with outside counsel, none of the claims or actions to which the Company is a party is expected to have a material adverse effect on the Company. 11 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS There were no matters submitted to a vote of security holders during the quarter ended December 31, 1994. EXECUTIVE OFFICERS OF THE REGISTRANT Below is a list of the names and ages of all executive officers of the Company as of March 15, 1995 indicating their positions with the Company and their principal occupations during the past five years. The current terms of the executive officers will expire at the next organizational meeting of the Company's Board of Directors or at such time as their successors are elected.
NAME AND AGE POSITIONS WITH THE COMPANY AND SUBSIDIARIES AND FIVE-YEAR EMPLOYMENT HISTORY ------------------------------ -------------------------------------------------------------------------------- David H. Murdock (71) Chairman of the Board, Chief Executive Officer and Director of the Company since July 1985. Since June 1982, Chairman of the Board and Chief Executive Officer of Flexi-Van Corporation, a Delaware corporation wholly-owned by Mr. Murdock. Sole owner and developer of the Sherwood Country Club in Ventura County, California, and numerous other real estate developments; also sole stockholder of numerous corporations engaged in a variety of business ventures and in the manufacture of textile-related products and industrial and building products. David A. DeLorenzo (48) President of Dole Food Company -- International since September 1993 and Executive Vice President and Member of the Office of the Chairman of the Company since July 1990. Director of the Company since February 1991. President of Dole Fresh Fruit Company from September 1986 to June 1992. Gerald W. LaFleur (62) Executive Vice President and Member of the Office of the Chairman of the Company since April 1992. Executive Vice President of Pacific Holding Company (a sole proprietorship of Mr. Murdock) since July 1991. Prior to July 1991, partner in Arthur Andersen LLP. Alan B. Sellers (47) Executive Vice President and Member of the Office of the Chairman of the Company since January 1990. Chief Financial Officer of the Company from March 1992 to February 1995 and Chief Administrative Officer of the Company from July 1990 to February 1995. Senior Vice President and General Counsel of the Company from February 1988 to January 1990. Corporate Secretary of the Company since February 1986. Vice President-Legal Affairs of Flexi-Van Corporation (a corporation wholly owned by Mr. Murdock) from August 1987 to December 1993; Corporate Secretary of Flexi-Van Corporation and General Counsel of Pacific Holding Company (a sole proprietorship of Mr. Murdock) from August 1986 to December 1993. Ernest W. Townsend (49) Executive Vice President, Member of the Office of the Chairman of the Company and President of Dole Food Company -- North America since September 1993. President of Dole Fresh Fruit and Vegetables (North America) since June 1992. President and Chief Executive Officer of the All-American Gourmet division of Kraft/General Foods from March 1989 to May 1992. President of Frozen Food Group of Kraft, Inc. from January 1988 to March 1989. George R. Horne (58) Vice President of the Company since October 1982. Vice President-Human Resources of Dole since February 1986.
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POSITIONS WITH THE COMPANY AND SUBSIDIARIES AND FIVE-YEAR NAME AND AGE EMPLOYMENT HISTORY ------------------------ ---------------------------------------------------------------- Michael S. Karsner (36) Vice President - Treasurer and Chief Financial Officer of the Company since February 1995. Vice President and Treasurer of the Company from January 1994 to February 1995. Vice President and Treasurer of The Black & Decker Corporation from January 1990 to January 1994. Vice President - Corporate Development of The Black and Decker Corporation from March 1989 to January 1990. Thomas C. Leppert (40) Vice President of the Company and President of Castle & Cooke Properties, Inc. since March 1989. Patricia A. McKay (37) Vice President - Finance and Controller of the Company since February 1995. Vice President - Controller of the Company from August 1991 to February 1995. Controller of Dole Fresh Fruit Company since October 1988. Patrick A. Nielson (44) Vice President and General Counsel - Food Operations of the Company since May 1994. General Counsel - Food Operations of the Company from July 1991 to May 1994. Vice President and General Counsel of Dole Fresh Fruit Company since 1983. J. Brett Tibbitts (39) Vice President and Corporate General Counsel of the Company since May 1994. General Counsel - Corporate of the Company from June 1992 to May 1994. Deputy General Counsel of the Company from January 1990 to June 1992. Assistant General Counsel of the Company from January 1988 to June 1990. Roberta Wieman (51) Vice President since February 1995. Executive Assistant to the Chairman of the Board and Chief Executive Officer from November 1991 to February 1995. Joint proprietor of sportswear outlet from 1986 to October 1991.
PART II ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS As of March 17, 1995, there were approximately 15,501 holders of record of the Company's Common Stock. Additional information required by Item 5 is contained on pages 26, 27, 30, 35 and 37 of the Dole Annual Report. Such information is incorporated herein by reference. ITEM 6. SELECTED FINANCIAL DATA There is hereby incorporated by reference the information appearing under the caption "Results of Operations and Selected Financial Data" on page 35 of the Dole Annual Report. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS There is hereby incorporated by reference the information appearing under the caption "Management's Discussion and Analysis of Results of Operations and Financial Position" on pages 32, 33 and 34 of the Dole Annual Report. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA There is hereby incorporated by reference the information appearing on pages 19 through 31 of the Dole Annual Report. See also Item 14 of this report. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE There have been no changes in the Company's independent auditors for the 1994 and 1993 fiscal years nor have there been any disagreements with the Company's independent auditors on accounting principles or practices for financial statement disclosures. 13 PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT There is hereby incorporated by reference the information regarding the Company's directors to appear under the caption "Election of Directors" in the Company's definitive proxy statement for its 1995 Annual Meeting of Stockholders (the "1995 Proxy Statement"). See the list of the Company's executive officers and related information under "Executive Officers of the Registrant", which is set forth in Part I hereof. ITEM 11. EXECUTIVE COMPENSATION There is hereby incorporated by reference the information to appear under the captions "Remuneration of Directors" and "Compensation of Executive Officers" in the 1995 Proxy Statement. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT There is hereby incorporated by reference the information with respect to security ownership to appear under the captions "General Information", "Beneficial Ownership of Certain Stockholders" and "Security Ownership of Directors and Executive Officers" in the 1995 Proxy Statement. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS There is hereby incorporated by reference the information to appear under the caption "Certain Transactions" in the 1995 Proxy Statement. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K (A) 1. FINANCIAL STATEMENTS: The following consolidated financial statements are included in the Dole Annual Report and are incorporated herein by reference:
ANNUAL REPORT PAGES ----------- Consolidated Statements of Income -- fiscal years ended December 31, 1994, January 1, 1994 and January 2, 1993............................................................................... 19 Consolidated Balance Sheets -- December 31, 1994 and January 1, 1994........................... 20 Consolidated Statements of Cash Flow -- fiscal years ended December 31, 1994, January 1, 1994 and January 2, 1993........................................................................... 21 Notes to Consolidated Financial Statements..................................................... 22-30 Report of Independent Public Accountants....................................................... 31
2. FINANCIAL STATEMENT SCHEDULES:
FORM 10-K PAGES ----------- Independent Public Accountants' Report on Financial Statement Schedule...................... F-1 Schedule II -- Valuation and Qualifying Accounts............................................ F-2
All other schedules are omitted because they are not applicable, not required or the information is included elsewhere in the financial statements or notes thereto. 14 3. EXHIBITS:
EXHIBIT NO. --------- 3.1 The Restated Articles of Association of the Company, as amended through July 30, 1991. Incorporated by reference to Exhibit 3(a) to the Company's Annual Report on Form 10-K for the fiscal year ended December 28, 1991, File No. 1-4455. 3.2 By-Laws of the Company, as amended through March 25, 1993. Incorporated by reference to Exhibit 3.2 to the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1994, File No. 1-4455. 4.1 Credit Agreement dated as of May 10, 1994 among the Company, Citicorp USA, Inc., as Administrative Agent and Lender and the financial institutions which are Lenders thereunder, relating to the Company's $1 billion revolving credit facility. Incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended June 18, 1994, File No.1-4455. 4.2 Indenture dated as of April 15, 1993 between the Company and Chemical Trust Company of California, relating to $300 million of the Company's senior notes. Incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K, event date May 6, 1993, File No. 1-4455. 4.3 Indenture dated as of July 15, 1993 between the Company and Chemical Trust Company of California, relating to $400 million of the Company's senior notes. Incorporated by reference to Exhibit 4 to the Company's Current Report on Form 8-K, event date July 15, 1993, File No. 1-4455. 4.4 The Company agrees to furnish to the Securities and Exchange Commission upon request a copy of each instrument with respect to issues of long-term debt of the Company and its subsidiaries, the authorized principal amount of which does not exceed 10% of the consolidated assets of the Company and its subsidiaries. Executive Compensation Plans and Arrangements -- Exhibits 10.1 - 10.10: 10.1 The Company's 1991 Stock Option and Award Plan. Incorporated by reference to Exhibit 10(a) to the Company's Annual Report on Form 10-K for the fiscal year ended December 28, 1991, File No. 1-4455. 10.2 The Company's 1982 Stock Option and Award Plan, as amended. Incorporated by reference to Exhibit 28(a) to the Company's Report on Form S-8 filed on May 22, 1989, Registration No. 33-28782. 10.3 Dole Food Company, Inc. Executive Supplementary Retirement Plan (effective January 1, 1989), First Restatement. Incorporated by reference to Exhibit 10(c) to Company's Annual Report on Form 10-K for the fiscal year ended December 29, 1990, File No. 1-4455. 10.4 Bonus Agreement dated as of August 30, 1991 by and between the Company and David A. DeLorenzo, with promissory note dated September 5, 1991 in the principal amount of $500,000 by David A. DeLorenzo in favor of the Company. Incorporated by reference to Exhibit 10(e) to the Company's Annual Report on Form 10-K for the fiscal year ended December 28, 1991, File No. 1-4455. 10.5 Employment Agreement between the Company and Gerald W. LaFleur. Incorporated by reference to Exhibit 10(k) to the Company's Annual Report on Form 10-K for the fiscal year ended January 2, 1993, File No. 1-4455.
15
EXHIBIT NO. --------- 10.6 Board of Directors Deferred Compensation Plan. Incorporated by reference to Exhibit 10.12 to the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1994, File No. 1-4455. 10.7 Dole Food Company, Inc. Annual Incentive Plan. Incorporated by reference to Exhibit 10.15 to the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1994, File No. 1-4455. 10.8 Dole Food Company, Inc. Long-Term Incentive Plan. Incorporated by reference to Exhibit 10.16 to the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1994, File No. 1-4455. 10.9 Dole Food Company, Inc. Executive Deferred Compensation Plan. 11 Computations of earnings per common share. 13 Dole Food Company, Inc. 1994 Annual Report for the fiscal year ended December 31, 1994. (This Report is furnished for information of the Commission and, except for those portions thereof which are expressly incorporated by reference herein, is not "filed" as a part of this Annual Report on Form 10-K.) 22 Subsidiaries of Dole Food Company, Inc. 23 Consent of Arthur Andersen LLP.
(b) REPORTS ON FORM 8-K: No current reports on Form 8-K were filed by the Company during the last quarter of the year ended December 31, 1994. 16 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) 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. DOLE FOOD COMPANY, INC. Registrant March 24, 1995 By /s/ DAVID H. MURDOCK ------------------------------------ David H. Murdock Chairman of the Board and Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. /s/ DAVID H. MURDOCK ---------------------------------------- Chairman of the Board and Chief March 24, 1995 David H. Murdock Executive Officer and Director /s/ DAVID A. DeLORENZO ---------------------------------------- Executive Vice President and Director March 24, 1995 David A. DeLorenzo /s/ MICHAEL S. KARSNER Vice President -- Treasurer and Chief ---------------------------------------- Financial and (Principal Financial March 24, 1995 Michael S. Karsner Officer) /s/ PATRICIA A. McKAY ---------------------------------------- Vice President -- Finance and Controller March 24, 1995 Patricia A. McKay (Principal Accounting Officer) /s/ ELAINE L. CHAO ---------------------------------------- Director March 24, 1995 Elaine L. Chao /s/ MIKE CURB ---------------------------------------- Director March 24, 1995 Mike Curb /s/ RICHARD M. FERRY ---------------------------------------- Director March 24, 1995 Richard M. Ferry /s/ JAMES F. GARY ---------------------------------------- Director March 24, 1995 James F. Gary /s/ FRANK J. HATA ---------------------------------------- Director March 24, 1995 Frank J. Hata
17 EXHIBIT INDEX
EXHIBIT NO. PAGE --------- ----- 3.1 The Restated Articles of Association of the Company, as amended through July 30, 1991. Incorporated by reference to Exhibit 3(a) to the Company's Annual Report on Form 10-K for the fiscal year ended December 28, 1991, File No. 1-4455. ............................................ 3.2 By-Laws of the Company, as amended through March 25, 1993. Incorporated by reference to Exhibit 3.2 to the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1994, File No. 1-4455. ...................................................................................... 4.1 Credit Agreement dated as of May 10, 1994 among the Company, Citicorp USA, Inc., as Administrative Agent and Lender and the financial institutions which are Lenders thereunder, relating to the Company's $1 billion revolving credit facility. Incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended June 18, 1994, File No.1-4455. ..... 4.2 Indenture dated as of April 15, 1993 between the Company and Chemical Trust Company of California, relating to $300 million of the Company's senior notes. Incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K, event date May 6, 1993, File No. 1-4455. ............ 4.3 Indenture dated as of July 15, 1993 between the Company and Chemical Trust Company of California, relating to $400 million of the Company's senior notes. Incorporated by reference to Exhibit 4 to the Company's Current Report on Form 8-K, event date July 15, 1993, File No. 1-4455. ............. 4.4 The Company agrees to furnish to the Securities and Exchange Commission upon request a copy of each instrument with respect to issues of long-term debt of the Company and its subsidiaries, the authorized principal amount of which does not exceed 10% of the consolidated assets of the Company and its subsidiaries. ............................................................................ Executive Compensation Plans and Arrangements -- Exhibits 10.1 - 10.10: 10.1 The Company's 1991 Stock Option and Award Plan. Incorporated by reference to Exhibit 10(a) to the Company's Annual Report on Form 10-K for the fiscal year ended December 28, 1991, File No. 1-4455. .......................................................................................... 10.2 The Company's 1982 Stock Option and Award Plan, as amended. Incorporated by reference to Exhibit 28(a) to the Company's Report on Form S-8 filed on May 22, 1989, Registration No. 33-28782. ...... 10.3 Dole Food Company, Inc. Executive Supplementary Retirement Plan (effective January 1, 1989), First Restatement. Incorporated by reference to Exhibit 10(c) to Company's Annual Report on Form 10-K for the fiscal year ended December 29, 1990, File No. 1-4455. .................................... 10.4 Bonus Agreement dated as of August 30, 1991 by and between the Company and David A. DeLorenzo, with promissory note dated September 5, 1991 in the principal amount of $500,000 by David A. DeLorenzo in favor of the Company. Incorporated by reference to Exhibit 10(e) to the Company's Annual Report on Form 10-K for the fiscal year ended December 28, 1991, File No. 1-4455. ......... 10.5 Employment Agreement between the Company and Gerald W. LaFleur. Incorporated by reference to Exhibit 10(k) to the Company's Annual Report on Form 10-K for the fiscal year ended January 2, 1993, File No. 1-4455. ........................................................................... 10.6 Board of Directors Deferred Compensation Plan. Incorporated by reference to Exhibit 10.12 to the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1994, File No. 1-4455. ..........................................................................................
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EXHIBIT NO. PAGE --------- ----- 10.7 Dole Food Company, Inc. Annual Incentive Plan. Incorporated by reference to Exhibit 10.15 to the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1994, File No. 1-4455. .......................................................................................... 10.8 Dole Food Company, Inc. Long-Term Incentive Plan. Incorporated by reference to Exhibit 10.16 to the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1994, File No. 1-4455. .......................................................................................... 10.9 Dole Food Company, Inc. Executive Deferred Compensation Plan. .................................... 10.15 Incorporated by reference to Exhibit 10.12 to the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1994, File No. 1-4455. .............................................. 10.16 Incorporated by reference to Exhibit 10.12 to the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1994, File No. 1-4455. .............................................. 11 Computations of earnings per common share. ....................................................... 13 Dole Food Company, Inc. 1994 Annual Report for the fiscal year ended December 31, 1994. (This Report is furnished for information of the Commission and, except for those portions thereof which are expressly incorporated by reference herein, is not "filed" as a part of this Annual Report on Form 10-K.) ...................................................................................... 22 Subsidiaries of Dole Food Company, Inc. .......................................................... 23 Consent of Arthur Andersen LLP. ..................................................................
19 INDEPENDENT PUBLIC ACCOUNTANTS REPORT ON FINANCIAL STATEMENT SCHEDULE To the Shareholders and Board of Directors of Dole Food Company, Inc.: We have audited in accordance with generally accepted auditing standards, the consolidated financial statements included in Dole Food Company, Inc.'s annual report to shareholders incorporated by reference in this Form 10-K, and have issued our report thereon dated January 30, 1995. Our audit was made for the purpose of forming an opinion on those statements taken as a whole. The schedule listed in the preceding index is the responsibility of the Company's management and presented for purposes of complying with the Securities and Exchange Commission's rules and not part of the basic financial statements. This schedule has been subjected to the auditing procedures applied in the audit of the basic financial statements, and in our opinion, fairly states in all material respects the financial data required to be set forth therein in relation to the basic financial statements taken as a whole. Arthur Andersen LLP Los Angeles, California January 30, 1995 F-1 SCHEDULE II DOLE FOOD COMPANY, INC. AND SUBSIDIARIES VALUATION AND QUALIFYING ACCOUNTS
ADDITIONS BALANCE AT CHARGED TO BEGINNING COSTS AND BALANCE AT OF YEAR EXPENSES DEDUCTIONS(A) END OF YEAR ----------- ----------- -------------- ----------- (IN THOUSANDS) Year Ended December 31, 1994 Allowance for doubtful accounts Trade receivables...................................... $ 18,396 $ 11,023 $ 4,198 25,221 Notes and other current receivables.................... 9,153 2,562 1,038 10,677 Long-term receivables.................................. 19,384 5,821 11,246 13,959 Year Ended January 1, 1994 Allowance for doubtful accounts Trade receivables...................................... $ 15,203 $ 7,733 $ 4,540 18,396 Notes and other current receivables.................... 9,706 1,083 1,636 9,153 Long-term receivables.................................. 27,838 4,572 13,026 19,384 Year Ended January 2, 1993 Allowance for doubtful accounts Trade receivables...................................... $ 13,681 $ 3,148 $ 1,626 15,203 Notes and and other current receivables................ 11,974 3,031 5,299 9,706 Long-term receivables.................................. 22,401 6,633 1,196 27,838 ------------------------ Note: (A) Write-off of uncollectible amounts.
F-2 EX-10.9 2 EXH 10.9 EXEC. DEFERRED COMP PLAN EXHIBIT 10.9 DOLE FOOD COMPANY, INC. EXECUTIVE DEFERRED COMPENSATION PLAN ADOPTED: FEBRUARY 2, 1995 TABLE OF CONTENTS Article 1 Purpose............................................................................... 1 Article 2 Definitions and Certain Provisions.................................................... 2 2.1 Annual Salary................................................................. 2 2.2 Annual Bonus.................................................................. 2 2.3 Beneficiary................................................................... 2 2.4 Board......................................................................... 2 2.5 Committee..................................................................... 2 2.6 Compensation.................................................................. 2 2.7 Declared Rate................................................................. 2 2.8 Deferral Account.............................................................. 2 2.9 Eligible Executive............................................................ 2 2.10 Enrollment Agreement.......................................................... 2 2.11 Excess Deferrals.............................................................. 2 2.12 Participant................................................................... 2 2.13 Payout Date................................................................... 2 2.14 Plan Year..................................................................... 2 2.15 Termination................................................................... 3 2.16 IRC Section401(a)17........................................................... 3 Article 3 Administration of the Plan............................................................ 4 3.1 Charter of the Committee...................................................... 4 3.2 Plan Interpretations Following a Change In Control............................ 4 Article 4 Participation......................................................................... 5 4.1 Election To Participate....................................................... 5 4.2 Deferral Options.............................................................. 5 4.3 Deferral Accounts............................................................. 5 4.4 Valuation of Accounts......................................................... 6 4.5 Statement of Accounts......................................................... 6 4.6 Refund of Deferrals........................................................... 6 Article 5 Benefits.............................................................................. 7 5.1 Benefit....................................................................... 7 5.2 Benefit Reelection............................................................ 7 5.3 Survivor Benefit.............................................................. 7 5.4 Emergency Benefit............................................................. 8 5.5 Early Payout.................................................................. 8 5.6 Small Benefit................................................................. 8 5.7 Withholding; Employment Taxes................................................. 8 Article 6 Beneficiary Designation............................................................... 9 Article 7 Arbitration........................................................................... 10 7.1................................................................................. 10
i Article 8 Amendment and Termination of the Plan................................................. 12 8.1 Amendment..................................................................... 12 8.2 Termination................................................................... 12 Article 9 Miscellaneous......................................................................... 13 9.1 Unsecured General Creditor.................................................... 13 9.2 Obligations to Company........................................................ 13 9.3 Nonassignability.............................................................. 13 9.4 Protective Provisions......................................................... 13 9.5 Gender, Singular, and Plural.................................................. 13 9.6 Captions...................................................................... 13 9.7 Validity...................................................................... 13 9.8 Notice........................................................................ 14 9.9 Applicable Law................................................................ 14
ii ARTICLE 1 PURPOSE The purpose of the Dole Food Company, Inc. Executive Deferred Compensation Plan (the "Plan") is to provide a means whereby Dole Food Company, Inc. (the "Company") may extend the opportunity to defer salary and bonus on a pretax basis to certain members of management. The Plan is effective as of March 1, 1995. It shall have no application to any persons who terminated their service prior to January 1, 1995, except as otherwise expressly determined by the Committee. 1 ARTICLE 2 DEFINITIONS AND CERTAIN PROVISIONS 2.1 ANNUAL SALARY. "Annual Salary" means base pay. 2.2 ANNUAL BONUS. "Annual Bonus" means the short-term incentive payout made under the Dole Food Company, Inc. Annual Incentive Plan. 2.3 BENEFICIARY. "Beneficiary" means the person or persons designated as such in accordance with Article 6. 2.4 BOARD. "Board" means the Board of Directors of the Company. 2.5 COMMITTEE. "Committee" means the Corporate Compensation & Benefits Committee of the Board appointed to administer the Plan pursuant to Article 3. 2.6 COMPENSATION. "Compensation" means earnings as defined in the Retirement Plan for Salaried Employees of Dole Food Company, Inc. and Participating Divisions and Subsidiaries, excluding severance pay and ignoring any IRS limitations, less deferrals under the Plan. 2.7 DECLARED RATE. "Declared Rate" means the interest rate for each Plan Year established by the Committee in accordance with Article 4.3(a). 2.8 DEFERRAL ACCOUNT. "Deferral Account" means the account maintained on the books of account of the Company for each Participant pursuant to Article 4.3. 2.9 ELIGIBLE EXECUTIVE. "Eligible Executive" means an employee designated by the Committee who is expected to earn salary and bonus in excess of $150,000 (as indexed under IRC Section401(a)17). 2.10 ENROLLMENT AGREEMENT. "Enrollment Agreement" means the election form that an Eligible Executive files with the Company to participate in the Plan. 2.11 EXCESS DEFERRALS. "Excess Deferrals" means deferrals which cause Compensation to fall below the IRC Section401(a)17 limitation. 2.12 PARTICIPANT. "Participant" means an executive who has filed a completed and executed Enrollment Agreement with the Committee and is participating in the Plan in accordance with the provisions of Article 4. 2.13 PAYOUT DATE. "Payout Date" means the date on which the Participant elected (in his enrollment form) to commence receiving deferred monies, but in no event later than Termination. 2.14 PLAN YEAR. "Plan Year" means the calendar year beginning January 1 and ending December 31. 2.15 TERMINATION. "Termination" means termination of employment or retirement other than by reason of death. 2.16 IRC SECTION401(A)17. "IRC Section401(a)17" refers to the section of the Internal Revenue Code which limits earnings under qualified pension plans. 2 ARTICLE 3 ADMINISTRATION OF THE PLAN 3.1 CHARTER OF THE COMMITTEE. This Plan shall be administered according to the Revised Charter of the Corporate Compensation & Benefits Committee. The provisions of the Revised Charter of the Corporate Compensation & Benefits Committee, including any amendments thereto subsequently adopted, are incorporated herein by reference as if set forth fully herein. 3.2 PLAN INTERPRETATIONS FOLLOWING A CHANGE IN CONTROL. Following a Change in Control or an Event, any provisions of this Plan or the Revised Charter of the Corporate Compensation & Benefits Committee which allow or purport to allow the Plan Committee, any Company, or any fiduciary of the Plan discretionary authority or power to construe and interpret the terms of the Plan shall be void as applied to any dispute involving benefits which accrued under this Plan prior to the Change in Control or Event. Accordingly, as to such disputes, an arbitrator or court shall, following a Change in Control or Event, interpret the Plan on a DE NOVO basis. 3 ARTICLE 4 PARTICIPATION 4.1 ELECTION TO PARTICIPATE. An Eligible Executive may elect to participate in the Plan effective as of the first day of the Plan Year by filing a completed and fully executed Enrollment Agreement with the Committee prior to the beginning of such Plan Year. The Committee also may permit any person who first becomes an Eligible Executive on or after the first day of a Plan Year to enroll in the Plan within 30 days following his eligibility. A separate Enrollment Agreement must be completed for each Plan Year in which a Participant makes deferrals under the Plan. Pursuant to such Enrollment Agreement, the Participant shall irrevocably elect the deferral option(s) in which he chooses to participate in accordance with Article 4.2. 4.2 DEFERRAL OPTIONS. The following deferral options will be available to Eligible Executives under the Plan, subject to the limitations and conditions herein stated and such other limitations and conditions as the Committee may impose, from time to time, in its complete and sole discretion. (a) ANNUAL SALARY. An Eligible Executive may elect to defer a specified percentage of his Annual Salary to be earned the following year. A minimum deferral of ten percent (10%) of the Participant's Annual Salary is required, and the maximum deferral allowed is one hundred percent (100%) of the Participant's Annual Salary. Deferral elections between 10% and 100% may be made in whole increments of 10%. (b) ANNUAL BONUS. An Eligible Executive may elect to defer a specified percentage of his Annual Bonus to be earned the following year. A minimum deferral of ten percent (10%) of the Participant's Annual Bonus is required, and the maximum deferral allowed is one hundred percent (100%) of the Participant's Annual Bonus. Deferral elections between 10% and 100% may be made in whole increments of 10%. An Eligible Executive may elect deferral option (a) only, deferral option (b) only, or deferral options (a) and (b). A Participant may elect to discontinue deferrals during the year if he satisfies the criteria set forth in Article 5.3 for receiving an Emergency Benefit. 4.3 DEFERRAL ACCOUNTS. The Committee shall establish and maintain separate Deferral Accounts for each Participant and every Payout Date. The amount of a Participant's Annual Salary or Annual Bonus that is deferred in accordance with Article 4.2 shall be credited to the Participant's Deferral Accounts no later than the first day of the month following the month in which such Annual Bonus and/or Annual Salary otherwise would have been paid. The Deferral Accounts shall be debited by the amount of any payments made to the Participant or the Participant's Beneficiary with respect to such Deferral Accounts pursuant to the Plan. (a) INTEREST ON DEFERRAL ACCOUNTS. Prior to the beginning of each Plan Year a Declared Rate of interest will be established by the Committee for that Plan Year. Interest will be credited on December 31 by multiplying the annual Declared Rate by the average balance in the Deferral Accounts during the preceding 12 months. The Declared Rate for a Plan Year applies both to the amounts initially deferred for such Plan Year and to the amounts previously credited to Deferral Accounts for previous Plan Years. The Declared Rate will be established on an annual basis by the Committee. 4.4 VALUATION OF ACCOUNTS. The value of a Deferral Account as of any date shall equal the amounts theretofore credited to such account, plus the interest deemed to be earned on such account in accordance with Article 4.3 through the day preceding such date, less the amounts theretofore debited to such account. 4 4.5 STATEMENT OF ACCOUNTS. The Committee shall submit to each Participant, within one hundred twenty (120) days after the close of each Plan Year, a statement in such form as the Committee deems desirable setting forth the balance standing to the credit of each Participant in each of his Deferral Accounts. 4.6 REFUND OF DEFERRALS. If at the earlier of December 31 of any year and Termination a Participant's Excess Deferrals are greater than zero, Excess Deferrals will be refunded no later than December 31 in an amount sufficient to cause Compensation to exceed the IRC Section401(a)17 limitation. 5 ARTICLE 5 BENEFITS 5.1 BENEFIT. A Participant is eligible for a benefit under the Plan when he has reached a Payout Date (as defined in Article 2). The benefit will be based on the total value of the Participant's Deferral Accounts. The benefit attributable to the amounts deferred for any Plan Year will be paid at the time and in the manner that the Participant elects pursuant to the Enrollment Agreement applicable to such Plan Year. Enrollment Agreements are irrevocable. The Enrollment Agreement shall provide that a Participant may elect a benefit Payout Date with respect to each year's deferral either: (a) Commencing January 1 in any year of the Participant's choosing other than the year for which the deferrals are made; or (b) Commencing the January 1 following his Termination, if later. The Enrollment Agreement also shall provide that a Participant may further elect to receive his retirement benefit in either a lump sum or annual installments over 5, 10, or 15 years. If the Participant elects to receive annual installments, the amount of each installment will equal his Deferral Account amortized on a level basis at the Declared Rate in effect immediately preceding the Payout Date. 5.2 BENEFIT REELECTION. Notwithstanding the Participant's Payout Date election under Article 5.1, a Participant, prior to the occurrence of a Payout Date, may elect to change said Payout Date to any subsequent January 1, provided such re-election is made at least two years prior to the original payout date. A Participant may make a Benefit Reelection only one time with respect to each Payout Date. 5.3 SURVIVOR BENEFIT. (a) If a Participant dies before the commencement of payment of his retirement benefit, the Company will pay to the Participant's Beneficiary the retirement benefit the Participant would have received had the Participant terminated his service with the Company on the day prior to such Participant's death, irrespective of when the Participant had elected to receive payment of his retirement benefit. Such payment shall be made in accordance with the method of payment (i.e., lump sum or installments) that the Participant had elected for payment of his retirement benefit. (b) If a Participant dies after the commencement of a payment of his retirement benefit, the Company will pay to the Participant's Beneficiary the remaining installments of any such benefit that would have been paid to the Participant had the Participant survived. 5.4 EMERGENCY BENEFIT. In the event that the Committee, on written petition of the Participant, determines, in its sole discretion, that the Participant has suffered an unforeseeable financial emergency, the Company shall pay to the Participant, as soon as practicable following such determination, an amount up to the balance of his Deferral Account as necessary to meet the emergency (the "Emergency Benefit"). For purposes of the Plan, an unforeseeable financial emergency is an unexpected need for cash arising from an illness, casualty loss, sudden financial reversal, or other such unforeseeable occurrence. The amount of the benefits otherwise payable under the Plan shall thereafter be adjusted to reflect the payment of the Emergency Benefit. Applications for Emergency Benefits and the determinations thereon by the Committee shall be in writing, and a Participant may be 6 required to furnish written proof of the financial emergency. Any Participant who receives an Emergency Benefit will be precluded from electing to make new deferrals under the Plan until the next enrollment period that occurs at least twelve (12) months following payment of the Emergency Benefit. 5.5 EARLY PAYOUT. Notwithstanding a Participant's election under Article 5.1, a Participant may elect to receive his entire Deferral Account in a single lump-sum payment less fifteen percent (15%) immediately. Such Participant will cease to become an Eligible Executive for the 12-month period commencing on the Early Payout. 5.6 SMALL BENEFIT. In the event the Committee determines that the balance of a Participant's Deferral Account is less than $25,000 at the time of commencement of payment of his benefit, or that the portion of the balance of the Participant's Deferral Account payable to any Beneficiary is less than $25,000 at the time of commencement of payment of a survivor benefit to such Beneficiary, the Company may pay the benefit in the form of a lump sum payment, notwithstanding any provision of this Article 5 to the contrary. Such lump sum payment shall be equal to the balance of the Participant's Deferral Account or the portion thereof payable to a Beneficiary. 5.7 WITHHOLDING; EMPLOYMENT TAXES. To the extent required by the law in effect at the time payments of deferred amounts are made, the Company shall withhold from payments made hereunder the minimum taxes required to be withheld by the federal or any state or local government. 7 ARTICLE 6 BENEFICIARY DESIGNATION Each Participant shall have the right, at any time, to designate any person or persons as Beneficiary or Beneficiaries to whom payments under the Plan shall be made in the event of the Participant's death prior to complete distribution to the Participant of the benefits due under the Plan. Each Beneficiary designation shall become effective only when filed in writing with the Committee on a form prescribed or accepted by the Committee. Any Participant shall have the right to designate a new Beneficiary at any time by filing with the Committee a written request for such change, but any such change shall become effective only on receipt of such request by the Committee. On receipt by the Committee of such request, the change shall relate back to and take effect as of the date the Participant signs such request, whether or not the Participant is living at the time the Committee receives such request. If there is no designated Beneficiary living at the death of the Participant when any payment hereunder shall be payable to a Beneficiary, then such payment shall be made as follows: To such Participant's wife or husband if living, and, if not living, to such Participant's executors or administrators. 8 ARTICLE 7 ARBITRATION 7.1(a) A Participant or, following the Participant's death, a Beneficiary (collectively referred to in this section as "Claimant") may, if he desires, submit any claim for payment under the Plan or any dispute regarding the interpretation of the Plan to arbitration. This right to select arbitration shall be solely that of the Claimant, and the Claimant may decide whether or not to arbitrate in his discretion. The "right to select arbitration" does not impose on the Claimant a requirement to submit a dispute for arbitration. The Claimant may, in lieu of arbitration, bring an action in appropriate civil court. The Claimant retains the right to select arbitration, even if a civil action (including, without limitation, an action for declatory relief) is brought by the Company or any other fiduciary of the Plan prior to the commencement of arbitration. If arbitration is selected by the Claimant after a civil action concerning the Claimant's dispute has been brought by a person other than the Claimant, the Company, the trustee of any grantor trust that holds assets for the purpose of making benefit payments under the Plan ("Trustee"), and the Claimant shall take such actions as are necessary or appropriate, including dismissal of the civil action, so that the arbitration can be timely heard. Once an arbitration is commenced, it may not be discontinued without the unanimous consent of all parties to the arbitration. During the lifetime of the Participant only he can use the arbitration procedure set forth in this section. (b) Any claim for arbitration may be submitted as follows: if the Claimant disagrees with an interpretation of the Plan by the Company or any fiduciary of the Plan, or disagrees with the calculation of his benefit under the Plan, such claim may be filed in writing with an arbitrator of the Claimant's choice who is selected by the method described in the next four sentences. The first step of the selection shall consist of the Claimant submitting in writing a list of five potential arbitrators to the Company and to the Trustee. Each of the five arbitrators must be either (1) a member of the National Academy of Arbitrators located in the state of the Claimant's principal residence or (2) a retired California Superior Court or Appellate Court judge. Within one week after receipt of the list, the Trustee and the Company shall jointly select one of the five arbitrators as the arbitrator of the dispute in question. If the Trustee and Company fail to select an arbitrator in a timely manner (including failure to select an arbitrator by reason of disagreement between the Trustee and the Company as to the arbitrator to be selected), the Claimant then shall designate one of the five arbitrators as the arbitrator of the dispute in question. (c) The arbitration hearing shall be held within seven days (or as soon thereafter as possible) after the selection of the arbitrator. No continuance of said hearing shall be allowed without the mutual consent of the Claimant, the Trustee, and the Company. Absence from or nonparticipation at the hearing by any party shall not prevent the issuance of an award. Hearing procedures that will expedite the hearing may be ordered at the arbitrator's discretion, and the arbitrator may close the hearing in his sole discretion when he decides he has heard sufficient evidence to justify issuance of an award. (d) The arbitrator's award shall be rendered as expeditiously as possible and in no event later than one week after the close of the hearing. In the event the arbitrator finds that the Claimant is entitled to the benefits he claimed, the arbitrator shall order the Company and/or the Trustee to pay such benefits, in the amounts and at such time as the arbitrator determines. The obligation of the Trustee to pay such benefits shall not, however, exceed the assets of the trust, and the Company shall be jointly and severally liable for any amount that the Trustee is ordered to pay. The award of the arbitrator shall be final and binding on the parties. The Company shall thereupon pay the Claimant immediately the amount that the arbitrator orders to be paid in the manner described in the award. The award may be enforced in any appropriate court as soon as possible after its rendition. If any action is brought to confirm the award, no appeal shall be taken by any party from any decision rendered in such action. 9 (e) If the arbitrator determines either that the Claimant is entitled to the claimed benefits or that the claim by the Claimant was made in good faith, the arbitrator shall direct the Company to pay to the Claimant, and Company agrees to pay to the Claimant in accordance with such order, an amount equal to the Claimant's expenses in pursuing the claim, including attorneys' fees. 10 ARTICLE 8 AMENDMENT AND TERMINATION OF THE PLAN 8.1 AMENDMENT. The Board may at any time amend the Plan in whole or in part; provided, however, that (1) no such amendment shall be effective to decrease the benefits accrued by any Participant prior to the date of such amendment; (2) no such amendment shall, without the written consent of a Participant, delay the date on which payment of the Participant's benefit is to be made; and (3) no amendment shall modify the procedure set forth under Article 8.2(b), except as may apply to a Participant who consents in writing to such amendment. Written notice of any amendment shall be given to each Participant in the Plan. 8.2 TERMINATION. (a) COMPANY'S RIGHT TO TERMINATE. The Board may at any time terminate the Plan. (b) PAYMENTS ON TERMINATION. On any termination of the Plan under this Article 8.2, the Participants will be deemed to have voluntarily terminated their participation under the Plan as of the date of such termination. Annual Salary and Annual Bonus shall prospectively cease to be deferred for the current Plan Year, and the Company will pay to each Participant the value of each of the Participants' Deferral Accounts, determined as if each had reached a Payout Date on the January 1 following the date of such termination of the Plan. 11 ARTICLE 9 MISCELLANEOUS 9.1 UNSECURED GENERAL CREDITOR. Participants and their Beneficiaries, heirs, successors, and assigns shall have no legal or equitable rights, claims, or interests in any specific property or assets of the Company, nor shall they be, as a result of the Plan, beneficiaries of or have any rights, claims, or interest in any life insurance policies, annuity contracts, or the proceeds therefrom that may hereafter be owned or acquired by the Company ("Policies"). Such Policies or assets of the Company shall not be held under any trust for the benefit of Participants, their Beneficiaries, heirs, successors, or assigns, or held in any way as collateral security for the fulfilling of the obligations of the Company under the Plan. Any and all of the Company's assets and Policies shall be, and remain, the general, unpledged, unrestricted assets of the Company. The Company's obligation under the Plan shall be merely that of any unfunded and unsecured promise of the Company to pay money in the future. 9.2 OBLIGATIONS TO COMPANY. If a Participant becomes entitled to a distribution of benefits under the Plan, and if at such time the Participant has outstanding any debt, obligation, or other liability representing an amount owing to the Company, then the Company may offset such amount owed to it against the amount of benefits otherwise distributable. Such determination shall be made by the Committee. 9.3 NONASSIGNABILITY. Neither a Participant nor any other person shall have any right to commute, sell, assign, transfer, pledge, anticipate, mortgage, or otherwise encumber, hypothecate, or convey in advance of actual receipt the amounts, if any, payable hereunder, or any part thereof, or interest therein that are, and all rights to which are expressly declared to be unassignable and nontransferable. No part of the amounts payable shall, prior to actual payment, be subject to seizure or sequestration for the payment of any debts, judgments, alimony, or separate maintenance owed by a Participant or any other person, or be transferable by operation of law in the event of a Participant's or any other person's bankruptcy or insolvency. 9.4 PROTECTIVE PROVISIONS. Each Participant shall cooperate with the Company by furnishing any and all information requested by the Company to facilitate the payment of benefits hereunder. 9.5 GENDER, SINGULAR, AND PLURAL. All pronouns and any variations thereof shall be deemed to refer to the masculine, feminine, or neuter, as the identity of the person or persons may require. As the context may require, the singular may be read as the plural and the plural as the singular. 9.6 CAPTIONS. The captions of the articles, sections, and paragraphs of the Plan are for convenience only and shall not control or affect the meaning or construction of any of its provisions. 9.7 VALIDITY. In the event any provision of the Plan is held invalid, void, or unenforceable, the same shall not affect, in any respect whatsoever, the validity of any other provision of the Plan. 9.8 NOTICE. Any notice or filing required or permitted to be given to the Committee under the Plan shall be sufficient if in writing and hand delivered, or sent by registered or certified mail, to the principal office of the Company, directed to the attention of the Vice President - Human Resources of the Company. Such notice shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification. 9.9 APPLICABLE LAW. The Plan shall be governed and construed in accordance with the laws of the State of California. 12 EX-11 3 EXHIBIT 11 COMPUTATION EXHIBIT 11 DOLE FOOD COMPANY, INC. AND SUBSIDIARIES Computation of Earnings Per Common Share (in thousands, except per share data)
1994 1993 1992 -------- -------- -------- PRIMARY Income before cumulative effect of change in accounting principle $ 67,883 $ 77,889 $ 65,213 Cumulative effect of change in accounting principle -- -- (49,492) -------- -------- -------- Net income applicable to common shares $ 67,883 $ 77,889 $ 15,721 -------- -------- -------- -------- -------- -------- Average number of common shares outstanding during the year 59,472 59,441 59,408 Shares issuable upon exercise of stock options at average prices during the year 208 261 253 -------- -------- -------- Total primary shares 59,680 59,702 59,661 -------- -------- -------- -------- -------- -------- Primary earnings per common share Income before cumulative effect of change in accounting principle $ 1.14 $ 1.30 $ 1.09 Cumulative effect of change in accounting principle -- -- (0.83) -------- -------- -------- Net income $ 1.14 $ 1.30 $ 0.26 -------- -------- -------- -------- -------- -------- FULLY DILUTED Income before cumulative effect of change in accounting principle $ 67,883 $ 77,889 $ 65,213 Cumulative effect of change in accounting principle -- -- (49,492) -------- -------- -------- Net income applicable to common shares $ 67,883 $ 77,889 $ 15,721 -------- -------- -------- -------- -------- -------- Average number of common shares outstanding during the year 59,472 59,441 59,408 Shares issuable upon exercise of stock options at higher of average prices or end of year prices 208 261 262 -------- -------- -------- Total fully diluted shares 59,680 59,702 59,670 -------- -------- -------- -------- -------- -------- Fully diluted earnings per common share Income before cumulative effect of change in accounting principle $ 1.14 $ 1.30 $ 1.09 Cumulative effect of change in accounting principle -- -- (0.83) -------- -------- -------- Net income $ 1.14 $ 1.30 $ 0.26 -------- -------- -------- -------- -------- --------
EX-13 4 EXHIBIT 13 ANNUAL REPORT DOLE FOOD COMPANY, INC. CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA) 1994 1993 1992 ---------------------------------------------------------------------------------------------------------------------------- Revenue $3,841,566 $3,430,521 $3,375,492 Cost of products sold 3,239,041 2,880,502 2,862,729 ---------------------------------------------------------------------------------------------------------------------------- Gross margin 602,525 550,019 512,763 Selling, marketing and administrative expenses 428,578 365,250 327,985 Cost reduction program -- 42,500 45,700 ---------------------------------------------------------------------------------------------------------------------------- Operating income 173,947 142,269 139,078 Interest expense (88,930) (71,682) (72,777) Interest income 11,907 12,464 15,846 Gain on sale of 18% of common stock of subsidiary -- 30,853 -- Other expense -- net (8,741) (15,815) (10,534) ---------------------------------------------------------------------------------------------------------------------------- Income before income taxes and cumulative effect of change in accounting principle 88,183 98,089 71,613 Income taxes (20,300) (20,200) (6,400) ---------------------------------------------------------------------------------------------------------------------------- Income before cumulative effect of change in accounting principle 67,883 77,889 65,213 Cumulative effect of change in accounting principle -- -- (49,492) ---------------------------------------------------------------------------------------------------------------------------- Net income $ 67,883 $ 77,889 $ 15,721 ---------------------------------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------------------------------- Earnings per common share, primary and fully diluted Income before cumulative effect of change in accounting principle $ 1.14 $ 1.30 $ 1.09 Cumulative effect of change in accounting principle -- -- (.83) ---------------------------------------------------------------------------------------------------------------------------- Net income $ 1.14 $ 1.30 $ .26 ---------------------------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------------------------
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS. 19 DOLE FOOD COMPANY, INC. CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARES OUTSTANDING) 1994 1993 ---------------------------------------------------------------------------------------------------------------------------- Current assets Cash and short-term investments $ 46,566 $ 37,497 Receivables -- net 510,221 407,554 Inventories 558,400 553,428 Real estate development inventory 183,492 105,900 Prepaid expenses 47,320 37,970 ---------------------------------------------------------------------------------------------------------------------------- Total current assets 1,345,999 1,142,349 Real estate developments 341,526 288,217 Investments 65,633 34,071 Property, plant and equipment -- net 1,926,453 1,767,089 Long-term receivables -- net 54,487 70,653 Other assets 114,584 85,540 ---------------------------------------------------------------------------------------------------------------------------- $3,848,682 $3,387,919 ---------------------------------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------------------------------- Current liabilities Notes payable $ 50,366 $ 64,050 Current portion of long-term debt 3,450 14,612 Accounts payable 212,859 163,966 Accrued liabilities 438,451 417,524 ---------------------------------------------------------------------------------------------------------------------------- Total current liabilities 705,126 660,152 Long-term debt 1,554,504 1,158,297 Deferred income taxes and other long-term liabilities 483,730 430,014 Minority interests 24,681 87,342 Common shareholders' equity Common stock (shares outstanding: 1994 -- 59,478,108; 1993 -- 59,455,918) 320,121 320,099 Additional paid-in capital 165,541 164,908 Retained earnings 634,717 596,573 Cumulative foreign currency translation adjustment (39,738) (29,466) ---------------------------------------------------------------------------------------------------------------------------- Total common shareholders' equity 1,080,641 1,052,114 ---------------------------------------------------------------------------------------------------------------------------- $3,848,682 $3,387,919 ---------------------------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------------------------
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS. 20 DOLE FOOD COMPANY, INC. CONSOLIDATED STATEMENTS OF CASH FLOW
(IN THOUSANDS) 1994 1993 1992 ---------------------------------------------------------------------------------------------------------------------------- Operating activities Net income $ 67,883 $ 77,889 $ 15,721 Adjustments to net income Depreciation and amortization 147,670 132,623 109,631 Undistributed equity earnings (2,470) (3,306) (1,880) Gain on sale of subsidiary stock -- (30,853) -- Provision (benefit) for deferred income taxes 8,530 649 (33,408) Cumulative effect of accounting change -- -- 49,492 Charge for cost reduction program -- 42,500 45,700 Other 1,232 (963) (585) Change in operating assets and liabilities, net of effects from acquisitions Receivables -- net (107,540) (18,603) (22,024) Inventories 2,007 16,477 4,609 Prepaid expenses (9,062) (8,222) 1,947 Real estate developments (77,032) (22,598) (86,990) Other assets (28,673) (23,145) (14,345) Accounts payable and accrued liabilities 53,460 (31,296) (35,113) Income taxes payable 8,558 (5,636) 13,929 Other 5,010 5,146 (13,043) ---------------------------------------------------------------------------------------------------------------------------- Cash flow from operations 69,573 130,662 33,641 Investing activities Proceeds from property disposals 17,657 17,140 5,917 Capital additions (239,717) (218,659) (191,745) Purchase price of acquisitions, net of acquired cash (93,115) (107,996) (14,342) Purchases of investments -- net (3,286) (181) (5,002) Purchase of minority interest in subsidiary (85,000) -- -- Other (614) 1,659 2,776 ---------------------------------------------------------------------------------------------------------------------------- Cash flow used in investing activities (404,075) (308,037) (202,396) Financing activities Short-term borrowings 54,213 78,244 149,184 Repayments of short-term debt (69,202) (117,014) (134,313) Long-term borrowings 415,185 687,782 359,480 Repayments of long-term debt (34,004) (542,487) (166,734) Cash dividends paid (23,791) (23,784) (23,763) Net proceeds on sale of subsidiary common stock -- 73,595 -- Other 1,170 1,264 568 ---------------------------------------------------------------------------------------------------------------------------- Cash flow from financing activities 343,571 157,600 184,422 Increase (decrease) in cash and short-term investments 9,069 (19,775) 15,667 Cash and short-term investments at beginning of year 37,497 57,272 41,605 ---------------------------------------------------------------------------------------------------------------------------- Cash and short-term investments at end of year $ 46,566 $ 37,497 $ 57,272 ---------------------------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------------------------
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS. 21 DOLE FOOD COMPANY, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 -- SUMMARY OF ACCOUNTING POLICIES PRINCIPLES OF CONSOLIDATION -- The consolidated financial statements include the accounts of Dole Food Company, Inc. and all significant majority-owned subsidiaries ("the Company"). ANNUAL CLOSING DATE -- The Company's fiscal year ends on the Saturday closest to December 31. Fiscal years 1994, 1993 and 1992 ended on December 31, 1994, January 1, 1994 and January 2, 1993, respectively. Fiscal years 1994 and 1993 each had 52 weeks and fiscal year 1992 had 53 weeks. INVENTORIES -- Inventories are stated at the lower of cost or market. Cost is determined principally on a first-in, first-out basis. Specific identification and average cost methods are also used for packing materials and operating supplies. AGRICULTURAL COSTS -- The costs of growing bananas and pineapples are charged to operations as incurred. Growing costs related to other crops are recognized when the crops are harvested and sold. REAL ESTATE DEVELOPMENTS -- Real estate developments are carried at cost, not in excess of net realizable value. Costs which are directly related to land development and construction are capitalized and amortized to cost of sales as closings occur. Profit from the sale of land and residential units is recognized when closings have occurred and other criteria for sale and profit recognition are satisfied in accordance with generally accepted accounting principles. INVESTMENTS -- Investments in affiliates with ownership of 20% to 50% are generally recorded on the equity method. PROPERTY, PLANT AND EQUIPMENT -- Property, plant and equipment are stated at cost, less accumulated depreciation. Depreciation is computed principally by the straight-line method over the estimated useful lives of the assets. FOREIGN EXCHANGE -- The U.S. dollar is the functional currency for substantially all of Dole's consolidated operations. Net foreign exchange gains or losses for companies with the U.S. dollar as their functional currency are included in determining net income and resulted in net losses of $3.5 million, $3.6 million and $2.4 million, for 1994, 1993 and 1992, respectively. Net exchange gains or losses resulting from the translation of assets and liabilities of foreign subsidiaries whose local currency is the functional currency are accumulated in a separate component of common shareholders' equity. INCOME TAXES -- Deferred income taxes are recognized for the tax consequences of temporary differences by applying enacted statutory tax rates to the differences between financial statement carrying amounts and the tax bases of assets and liabilities. The income taxes which would be due upon the distribution of foreign subsidiary earnings have not been provided where the undistributed earnings are considered permanently invested. EARNINGS PER COMMON SHARE -- Primary earnings per common share are based on the weighted average number of shares outstanding during the period after consideration of the dilutive effect of stock options and restricted stock awards. The primary weighted average number of common shares outstanding was 59.7 million for 1994, 1993 and 1992. CASH AND SHORT-TERM INVESTMENTS -- Cash and short-term investments include cash on hand and time deposits. Such short-term investments generally have maturities of three months or less at the time of purchase. FAIR VALUE OF FINANCIAL INSTRUMENTS -- For short-term financial instruments, the historical carrying amount is a reasonable estimate of fair value. For long-term financial instruments not readily marketable, fair values were estimated based upon discounted future cash flows at prevailing market interest rates. Based on these assumptions, management believes the fair market values of the Company's financial instruments other than certain debt instruments (see Note 6) are not materially different from their recorded amounts as of December 31, 1994 and January 1, 1994. RECLASSIFICATIONS -- Certain prior year amounts have been reclassified to conform to the 1994 presentation. 22 NOTE 2 -- ACQUISITIONS During 1994, the Company acquired certain businesses for an aggregate purchase price of approximately $94 million. These acquisitions included a 35% interest in a produce distribution company in the United Kingdom, as well as various other food and food related operations. The Company also purchased three commercial real estate properties. In 1993, the Company invested $117 million to acquire various businesses including a French dried fruit and nut business, three French banana ripening and distribution companies, two affiliated fruit juice businesses and five commercial real estate properties. The purchase agreement related to the 1993 acquisition of the fruit juice businesses provides for potential additional consideration to be paid based upon future operating results. Each of these acquisitions was accounted for as a purchase and, accordingly, the purchase price was allocated to the net assets acquired based upon their estimated fair values at the date of acquisition. The fair values of assets acquired and liabilities assumed in connection with the 1994 acquisitions totaled $121 million (including cash of $1 million) and $27 million, respectively, and $200 million (including cash of $9 million) and $83 million, respectively, for the 1993 acquisitions. NOTE 3 -- SUBSIDIARY STOCK TRANSACTIONS During the first quarter of 1993, approximately 18% or 5.4 million shares of the common stock of the Company's residential real estate development company, Castle & Cooke Homes, Inc., was sold at $15 per share through an initial public offering. Net proceeds from the sale totaled approximately $74 million and resulted in a gain of approximately $31 million ($18 million, net of tax). During the fourth quarter of 1994, the Company acquired the minority shareholders' interest in Castle & Cooke Homes, Inc. through a cash tender offer for $15.75 per share, or for an aggregate purchase price of $85 million including related expenses. This transaction was accounted for as a purchase. The excess of the purchase price over the book basis of the minority interest acquired, after consideration of related tax effects, was allocated to real estate developments. NOTE 4 -- CURRENT ASSETS AND LIABILITIES Short-term investments of $8.3 million and $11.7 million in 1994 and 1993, respectively, consisted principally of time deposits. Outstanding checks which are funded as presented for payment totaled $38.9 million and $31.7 million in 1994 and 1993, respectively, and were included in accounts payable. Details of certain current assets were as follows:
(IN THOUSANDS) 1994 1993 -------------------------------------------------------- Receivables Trade $394,806 $290,507 Notes and other 144,019 130,253 Affiliated operations 7,294 14,343 -------------------------------------------------------- 546,119 435,103 Allowance for doubtful accounts (35,898) (27,549) -------------------------------------------------------- $510,221 $407,554 -------------------------------------------------------- -------------------------------------------------------- Inventories Finished products $205,922 $213,753 Raw materials and work in progress 138,152 160,635 Growing crop costs 36,605 38,509 Packing materials 96,729 69,843 Operating supplies and other 80,992 70,688 -------------------------------------------------------- $558,400 $553,428 -------------------------------------------------------- --------------------------------------------------------
Accrued liabilities in 1994 and 1993 included approximately $84.6 million and $104.6 million, respectively, of amounts due to growers. In 1992, the Company implemented a worldwide cost reduction program which involved employee reductions, facility consolidations and aggressive efforts to reduce procurement and other costs and to enhance productivity. The Company recorded a charge in the fourth quarter of 1992 of $45.7 million for severance and costs associated with these undertakings. In 1993, in line with its continued cost reduction and profit improvement efforts, the Company targeted additional operations for closure and consolidation, resulting in a fourth quarter charge of $42.5 million. Accrued liabilities in 1994 and 1993 reflected approximately $12.2 million and $45.9 million, respectively, of amounts related to these programs. 23 NOTE 5 -- PROPERTY, PLANT AND EQUIPMENT Major classes of property, plant and equipment were as follows:
(IN THOUSANDS) 1994 1993 ------------------------------------------------------ Land and land improvements $ 769,315 $ 681,353 Buildings and improvements 619,918 499,680 Machinery and equipment 1,038,734 921,031 Construction in progress 95,238 153,934 ------------------------------------------------------ 2,523,205 2,255,998 Accumulated depreciation (596,752) (488,909) ------------------------------------------------------ $1,926,453 $1,767,089 ------------------------------------------------------ ------------------------------------------------------
Depreciation expense for 1994, 1993 and 1992 totaled $134.3 million, $120.8 million and $106.6 million, respectively. At December 31, 1994, the Company had remaining commitments to spend approximately $12 million for vessels for its fresh fruit operations. NOTE 6 -- DEBT Notes payable consisted primarily of short-term borrowings required to fund certain foreign operations and totaled $50.4 million with a weighted average interest rate of 6.2% at the end of 1994, and $64.1 million with a weighted average interest rate of 9.6% at the end of 1993. Long-term debt consisted of:
(IN THOUSANDS) 1994 1993 ----------------------------------------------------------- Unsecured debt Notes payable to banks at an average interest rate of 6.2% (3.9% -- 1993) $ 835,598 $ 397,807 6.75% notes due 2000 225,000 225,000 7% notes due 2003 300,000 300,000 7.875% debentures due 2013 175,000 175,000 Various other notes due 1995 -- 2006 at an average interest rate of 5.2% (7.2% -- 1993) 7,840 16,604 Secured debt Mortgages, contracts and notes due 1995-2007, at an average interest rate of 9.6% (6.7% -- 1993) 17,608 61,967 Unamortized debt discount and issue costs (3,092) (3,469) ----------------------------------------------------------- 1,557,954 1,172,909 Current maturities (3,450) (14,612) ----------------------------------------------------------- $1,554,504 $1,158,297 ----------------------------------------------------------- -----------------------------------------------------------
On May 6, 1993 and July 27, 1993, the Company sold $300 million and $400 million, respectively, of unsecured noncallable notes in public offerings. The $300 million notes bear interest at 7% and mature in 2003. The $400 million issuance is comprised of $225 million notes bearing interest at 6.75% and maturing in 2000 and $175 million notes bearing interest at 7.875% and maturing in 2013. The Company estimates the fair value of its fixed interest rate unsecured debt based on current quoted market prices. The estimated fair value was $628 million at December 31, 1994. At January 1, 1994, the estimated fair value approximated book value. In November 1993, the Company entered into a $400 million, 364-day revolving credit facility. There were no borrowings outstanding under this facility at January 1, 1994. In May 1994, the Company replaced its $400 million facility with a $1 billion, 5-year revolving credit facility ("Facility"). At the Company's option, borrowings under the Facility bear interest at the agent's prime rate or at a certain percentage over the London Interbank Offered Rate ("LIBOR"). Provisions under the Facility require the Company to comply with certain financial covenants which include a maximum permitted ratio of consolidated debt to net worth and a minimum required fixed charge coverage ratio. At December 31, 1994, net borrowings outstanding under this Facility totaled approximately $771 million. The Company may also borrow under uncommitted lines of credit at rates offered from time to time by various banks that may or may not be lenders under the Facility. Net borrowings outstanding under the uncommitted lines of credit totaled $65.0 million and $397.8 million at December 31, 1994 and January 1, 1994, respectively. At January 1, 1994, Castle & Cooke Homes, Inc. had borrowings under its $100 million revolving credit facility totaling $47.7 million with a weighted average interest rate of 5.5%. During 1994, this credit facility was amended to increase available borrowings from $100 million to $135 million. In December 1994, in conjunction with the Company's tender offer, all borrowings outstanding under this credit agreement were refinanced using the Company's Facility, at which time the Castle & Cooke Homes, Inc. credit facility was terminated. Sinking fund requirements and maturities with respect to long-term debt at December 31, 1994 were as follows (in millions): 1996 -- $4.5; 1997 -- $2.1; 1998 -- $1.9; 1999 -- $837.4; and thereafter -- $708.6. 24 Interest payments during 1994, 1993 and 1992, net of amounts capitalized, totaled $90.2 million, $60.0 million and $75.9 million, respectively. Interest costs of $7.0 million, $4.4 million and $5.4 million were capitalized in 1994, 1993 and 1992, respectively, pertaining to constructed assets. NOTE 7 -- EMPLOYEE BENEFIT PLANS The Company has qualified defined benefit pension plans covering certain full-time employees. Benefits under these plans are generally based on each employee's eligible compensation, except for certain hourly plans which are based on negotiated benefits and years of service. For U.S. plans, the Company's funding policy is to fund the net periodic pension cost plus a 15-year amortization of the unfunded liability. The plans covering foreign employees are generally not funded. The status of the plans was as follows:
(IN THOUSANDS) 1994 1993 ------------------------------------------------------------- Actuarial present value of accumulated benefit obligation Vested $233,202 $248,492 Non-vested 14,001 16,866 ------------------------------------------------------------- $247,203 $265,358 ------------------------------------------------------------- Actuarial present value of projected benefit obligation $265,158 $282,765 Plan assets at fair value, primarily stocks and bonds 220,229 241,262 ------------------------------------------------------------- Projected benefit obligation in excess of plan assets (44,929) (41,503) Unrecognized net transition obligation 2,646 2,167 Unrecognized prior service cost 6,244 6,763 Unrecognized net loss 17,447 13,320 Additional minimum liability (11,612) (9,120) ------------------------------------------------------------- Accrued pension liability $(30,204) $(28,373) ------------------------------------------------------------- -------------------------------------------------------------
For U.S. plans, the projected benefit obligation was determined using an assumed discount rate of 8.5% in 1994 and 7.25% in 1993, and an assumed rate of increase in future compensation levels of 5% in both 1994 and 1993. The expected long-term rate of return on assets was 9% in both years. For non-U.S. plans, the projected benefit obligation was determined using assumed discount rates of 12% to 20% in 1994 and 12% to 15% in 1993, and assumed rates of increase in future compensation levels of 10% to 17.5% in 1994 and 10% to 13% in 1993. The expected long-term rate of return on assets for non-U.S. plans was 12% to 20% in 1994 and 12% to 15% in 1993. Pension expense included the following components:
(IN THOUSANDS) 1994 1993 1992 ----------------------------------------------------------- Service cost-benefits earned during the year $ 8,049 $ 6,600 $ 6,691 Interest cost on projected benefit obligation 21,232 21,737 20,894 Actual (return) loss on plan assets 4,954 (33,136) (16,675) Net amortization and deferral (24,325) 14,125 (2,085) ----------------------------------------------------------- $ 9,910 $ 9,326 $ 8,825 ----------------------------------------------------------- -----------------------------------------------------------
The Company has several 401(k) plans generally covering full-time U.S. employees with at least one year of continuous service. Eligible employees may defer a percentage of their annual compensation up to a maximum allowable under federal income tax law to supplement their retirement income. These plans provide for Company contributions based on a certain percentage of each participant's contribution. Total Company contributions to these plans for 1994, 1993 and 1992 were $4.9 million, $4.8 million and $4.3 million, respectively. The Company is also a party to various industrywide collective bargaining agreements which also provide pension benefits. Total contributions to these plans plus direct payments to pensioners were $1.5 million in 1994, $1.9 million in 1993 and $3.0 million in 1992. In addition to providing pension benefits, the Company provides certain health care and life insurance benefits for eligible retired employees. Certain employees may become eligible for such benefits if they fulfill established requirements upon reaching retirement age. In 1992, the Company implemented Statement of Financial Accounting Standards No. 106, "Employers' Accounting for Postretirement Benefits Other Than Pensions." This statement, among other changes, requires companies to accrue the projected costs of retiree benefits during the employee's active service period. The Company elected to immediately recognize the accumulated postretirement benefit obligation as of December 29, 1991 of $82.5 million ($49.5 million, net of tax). 25 The status of the plans was as follows:
(IN THOUSANDS) 1994 1993 ------------------------------------------------------ Accumulated postretirement benefit obligation ("APBO") Retirees $63,809 $61,993 Fully eligible actives 9,886 20,560 Other actives 9,042 15,511 ------------------------------------------------------ 82,737 98,064 Unrecognized prior service cost 1,516 (92) Unrecognized net gain (loss) 4,447 (9,347) ------------------------------------------------------ Accrued postretirement benefit liability $88,700 $88,625 ------------------------------------------------------ ------------------------------------------------------
Net periodic postretirement benefit cost included the following components:
(IN THOUSANDS) 1994 1993 ------------------------------------------------------------ Service cost -- benefits earned during the year $ 609 $ 852 Interest cost on APBO 7,044 7,751 Net amortization and deferral 35 5 ------------------------------------------------------------ Net periodic postretirement benefit cost $7,688 $8,608 ------------------------------------------------------------ ------------------------------------------------------------
For U.S. plans, an annual rate of increase in the per capita cost of covered health care benefits of 13.0% in 1995 decreasing to 5.5% in 2010 and thereafter was assumed in determining the APBO for 1994, and 13.5% in 1994 decreasing to 5.5% in 2010 was assumed in determining the APBO for 1993. For the Company's foreign plan, the assumed health care cost trend rate was 20% in 1994 and 15% in 1993. The health care cost trend rate assumption has a significant effect on the amounts reported. Increasing the assumed health care cost trend rate by one percentage point in each year would have resulted in an increase in the Company's APBO as of December 31, 1994 of approximately $8.9 million and the aggregate of the service and interest cost components of net periodic postretirement benefit cost for 1994 of approximately $1.0 million. The weighted average discount rate used in determining the APBO was 8.5% in 1994 and 7.25% in 1993 for U.S. plans and 20% in 1994 and 15% in 1993 for the foreign plan. The plans are not funded. The Company provides postemployment benefits to certain former and inactive employees. The Company adopted Statement of Financial Accounting Standards No. 112, "Employers' Accounting for Postemployment Benefits" as of the beginning of 1994. This accounting standard requires the accrual of the cost of postemployment benefits over the employees' years of service. The cumulative effect of adopting this new standard was not significant. NOTE 8 -- STOCK OPTIONS AND AWARDS Under the 1991 and 1982 Stock Option and Award Plans ("the Plans"), the Company can grant incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock awards and performance share awards to officers and key employees of the Company. Stock options may be exercised for up to ten years from the date of grant with or without stock appreciation rights, as determined by the committee of the Company's Board of Directors administering the Plans. No stock appreciation rights or performance share awards were outstanding at December 31, 1994. Changes in outstanding stock options were as follows:
AVERAGE SHARES PRICE ------------------------------------------------------- Outstanding, December 28, 1991 1,517,349 $29.91 Granted 40,000 32.14 Exercised (9,717) 27.96 Cancelled (51,902) 38.00 ------------------------------------------------------- Outstanding, January 2, 1993 1,495,730 29.70 Granted 411,850 33.12 Exercised (41,733) 27.88 Cancelled (146,065) 36.52 ------------------------------------------------------- Outstanding, January 1, 1994 1,719,782 29.98 Granted 508,500 29.07 Exercised (12,117) 26.69 Cancelled (160,401) 34.39 ------------------------------------------------------- Outstanding, December 31, 1994 2,055,764 $29.43 ------------------------------------------------------- ------------------------------------------------------- Exercisable, December 31, 1994 1,345,619 $28.94 ------------------------------------------------------- -------------------------------------------------------
During 1992, the Company granted 27,500 restricted stock awards to key employees. These awards become fully vested over a five-year period from the date of grant. At December 31, 1994, 15,000 restricted stock awards were outstanding. NOTE 9 -- SHAREHOLDERS' EQUITY Authorized capital at December 31, 1994 consisted of 80 million shares of no par value common stock and 30 million shares of no par value preferred stock, issuable in series. At December 31, 1994, approximately 3.7 million shares of common stock were reserved for issuance under the Company's Stock Option and Award Plans. There was no preferred stock outstanding. The Company's dividend policy is to pay quarterly dividends on common shares at an annual rate of 40 cents per share. Dividends declared in 1994 included the regular 10 cents per share dividend related to the first quarter of 1995. 26 Changes in shareholders' equity were as follows:
CUMULATIVE FOREIGN TOTAL ADDITIONAL CURRENCY COMMON COMMON COMMON PAID-IN RETAINED TRANSLATION SHAREHOLDERS' SHARES (IN THOUSANDS, EXCEPT SHARE DATA) STOCK CAPITAL EARNINGS ADJUSTMENT EQUITY OUTSTANDING ----------------------------------------------------------------------------------------------------------------------------- Balance, December 28, 1991 $320,036 $163,139 $550,510 $(24,245) $1,009,440 59,393,943 Net income -- -- 15,721 -- 15,721 -- Cash dividends declared ($.40 per share) -- -- (23,763) -- (23,763) -- Translation adjustments -- -- -- (948) (948) -- Other 21 547 -- -- 568 20,712 ----------------------------------------------------------------------------------------------------------------------------- Balance, January 2, 1993 320,057 163,686 542,468 (25,193) 1,001,018 59,414,655 Net income -- -- 77,889 -- 77,889 -- Cash dividends declared ($.40 per share) -- -- (23,784) -- (23,784) -- Translation adjustments -- -- -- (4,273) (4,273) -- Other 42 1,222 -- -- 1,264 41,263 ----------------------------------------------------------------------------------------------------------------------------- Balance, January 1, 1994 320,099 164,908 596,573 (29,466) 1,052,114 59,455,918 Net income -- -- 67,883 -- 67,883 -- Cash dividends declared ($.50 per share) -- -- (29,739) -- (29,739) -- Translation adjustments -- -- -- (10,272) (10,272) -- Other 22 633 -- -- 655 22,190 ----------------------------------------------------------------------------------------------------------------------------- Balance, December 31, 1994 $320,121 $165,541 $634,717 $(39,738) $1,080,641 59,478,108 ----------------------------------------------------------------------------------------------------------------------------- -----------------------------------------------------------------------------------------------------------------------------
NOTE 10 -- CONTINGENCIES The Company is contingently liable as joint indemnitors on surety bonds related to its real estate development operations. Outstanding bond commitments approximated $143 million at December 31, 1994. The Company was contingently liable for guarantees of indebtedness aggregating approximately $46 million at December 31, 1994. These guarantees were issued on behalf of certain key fruit suppliers. The Company is involved from time to time in various claims and legal actions incident to its operations, both as plaintiff and defendant. In the opinion of management, after consultation with legal counsel, none of such claims is expected to have a material adverse effect on the Company. NOTE 11 -- LEASE COMMITMENTS The Company has obligations under non-cancelable operating leases, primarily for ship charters and containers, and certain equipment and office facilities. Lease terms are generally for less than the economic life of the property. Certain agricultural land leases provide for increases in minimum rentals based on production. Total rental expense was $178.7 million, $168.5 million and $171.1 million (net of sublease income of $13.3 million, $19.1 million and $39.2 million) for 1994, 1993 and 1992, respectively. At December 31, 1994, the aggregate minimum rental commitments, before future sublease income, were as follows (in millions): 1995 -- $99.1; 1996 -- $66.8; 1997 -- $43.6; 1998 -- $15.2; 1999 -- $10.6 and thereafter -- $57.1. Future sublease income totaled $21.5 million. 27 NOTE 12 -- INCOME TAXES In 1992, the Company adopted Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes" and elected to apply the provisions retroactively to 1989. Accordingly, retained earnings at December 30, 1989 were reduced by $31.7 million, the cumulative effect of the change in the method of accounting for income taxes. Income tax expense (benefit) was as follows:
(IN THOUSANDS) 1994 1993 1992 -------------------------------------------------------------- Current Federal, state and local $ (9,651) $ 5,926 $ 20,472 Foreign 21,421 13,625 19,336 -------------------------------------------------------------- 11,770 19,551 39,808 -------------------------------------------------------------- Deferred Federal, state and local 3,446 6,034 (33,408) Foreign 5,084 (5,385) -- -------------------------------------------------------------- 8,530 649 (33,408) -------------------------------------------------------------- $20,300 $20,200 $ 6,400 -------------------------------------------------------------- --------------------------------------------------------------
Pretax earnings attributable to foreign operations were $165 million, $145 million and $163 million for 1994, 1993 and 1992, respectively. Undistributed earnings of foreign subsidiaries, which have been or are intended to be permanently invested, aggregated $909 million at December 31, 1994. The Company's reported income tax expense varied from the expense calculated using the U.S. federal statutory tax rate for the following reasons:
(IN THOUSANDS) 1994 1993 1992 -------------------------------------------------------------- Expense computed at U.S. federal statutory income tax rate $ 30,864 $ 34,331 $ 24,348 Foreign income taxed at different rates (11,036) (24,014) (21,431) Dividends from subsidiaries 187 341 425 State and local income tax, net of federal income tax benefit 932 1,715 1,532 Impact of tax rate change -- 2,510 -- Other (647) 5,317 1,526 -------------------------------------------------------------- Reported income tax expense $ 20,300 $ 20,200 $ 6,400 -------------------------------------------------------------- --------------------------------------------------------------
Total income tax payments, net of refunds, in 1994, 1993 and 1992 were $3.1 million, $23.7 million and $29.4 million, respectively. Deferred tax assets (liabilities) were comprised of the following:
(IN THOUSANDS) 1994 1993 1992 -------------------------------------------------------------- Operating reserves $ 6,677 $ 16,769 $ 17,919 Accelerated depreciation (38,213) (41,703) (42,613) Inventory valuation methods 16,667 10,083 14,437 Effect of differences between book values assigned in prior acquisitions and historical tax values (116,668) (109,953) (104,245) Postretirement benefits 33,988 36,336 34,234 Current year acquisitions (23,098) (8,603) -- Tax credit carryforward 30,509 39,075 -- Net operating loss carryforward 10,998 3,115 16,042 Gain on sale of subsidiary stock (12,650) (12,650) -- Other (37,462) (30,053) (24,125) -------------------------------------------------------------- $(129,252) $ (97,584) $ (88,351) -------------------------------------------------------------- --------------------------------------------------------------
The tax credit carryforward amount is primarily comprised of alternative minimum tax credits which can be utilized to reduce regular tax liabilities and may be carried forward indefinitely. The remaining credits expire from 1998 to 2009. Total deferred tax assets and deferred tax liabilities were as follows:
(IN THOUSANDS) 1994 1993 1992 ----------------------------------------------------------- Deferred tax assets $ 210,972 $ 200,249 $ 190,546 Deferred tax liabilities (340,224) (297,833) (278,897) ----------------------------------------------------------- $(129,252) $ (97,584) $ (88,351) ----------------------------------------------------------- -----------------------------------------------------------
The Company remains contingently liable with respect to certain tax credits sold with recourse by Flexi-Van Corporation ("Flexi-Van"), the Company's former transportation equipment leasing business, to a third party in 1981. These credits which have been contested by the Internal Revenue Service continue to be litigated by Flexi-Van. Flexi-Van, which separated from the Company in 1987 and was subsequently acquired by David H. Murdock, has indemnified the Company against obligations that might result from the resolution of this matter. 28 NOTE 13 -- INDUSTRY AND GEOGRAPHIC AREA SEGMENT INFORMATION The Company's major operations are in Food Products, Real Estate and Resorts. The Food Products segment procures, grows, processes and markets fruits, vegetables and nuts in the following locations: (1) North America; (2) Latin America -- principally Chile, Colombia, Costa Rica, Ecuador, Honduras and Panama; (3) Asia -- principally Japan, the Philippines and Thailand; and (4) Europe -- principally Germany, France and Italy. Real estate activities are conducted in the United States and consist primarily of holding, developing, operating and selling residential and commercial real estate. Resorts include two luxury hotels on the Island of Lana'i in Hawaii. Revenue, operating income, identifiable assets, capital expenditures and depreciation and amortization pertaining to the industries and geographic areas in which the Company operates are presented below. Product transfers between geographic areas are accounted for based on the estimated fair market value of the products.
(IN MILLIONS) 1994 1993 1992 ---------------------------------------------------------- Revenue Food Products North America $1,933 $1,890 $1,997 Latin America 677 640 924 Asia 842 700 648 Europe 777 577 488 Intercompany elimination (731) (699) (937) ---------------------------------------------------------- Total Food Products 3,498 3,108 3,120 Real Estate 297 284 230 Resorts 47 39 26 ---------------------------------------------------------- $3,842 $3,431 $3,376 ---------------------------------------------------------- ---------------------------------------------------------- Operating Income Food Products North America $ (8) $ 39 $ 40 Latin America 131 62 64 Asia 16 77 83 Europe 13 -- 10 ---------------------------------------------------------- Total Food Products 152 178 197 Real Estate 73 64 53 Resorts (37) (40) (41) Corporate and unallocated (14) (17) (24) Cost reduction program -- (43) (46) ---------------------------------------------------------- $ 174 $ 142 $ 139 ---------------------------------------------------------- ----------------------------------------------------------
(IN MILLIONS) 1994 1993 1992 ---------------------------------------------------------- Identifiable Assets Food Products North America $1,065 $1,043 $ 999 Latin America 776 707 695 Asia 332 266 248 Europe 339 211 85 --------------------------------------------------------- Total Food Products 2,512 2,227 2,027 Real Estate 946 788 715 Resorts 336 316 301 Corporate 55 57 52 --------------------------------------------------------- $3,849 $3,388 $3,095 --------------------------------------------------------- --------------------------------------------------------- Capital Expenditures Food Products $ 212 $ 174 $ 164 Real Estate 9 9 18 Resorts 19 36 10 --------------------------------------------------------- $ 240 $ 219 $ 192 --------------------------------------------------------- --------------------------------------------------------- Depreciation and Amortization Food Products $ 117 $ 100 $ 88 Real Estate 10 12 5 Resorts 18 16 15 Corporate and unallocated 3 5 2 --------------------------------------------------------- $ 148 $ 133 $ 110 --------------------------------------------------------- ---------------------------------------------------------
NOTES: FOOD PRODUCTS REVENUE INCLUDES INTER-AREA TRANSFERS FROM LATIN AMERICA TO NORTH AMERICA, ASIA AND EUROPE OF $444 MILLION IN 1994, $418 MILLION IN 1993 AND $731 MILLION IN 1992; INTER-AREA TRANSFERS FROM ASIA TO NORTH AMERICA AND EUROPE OF $190 MILLION IN 1994, $227 MILLION IN 1993 AND $206 MILLION IN 1992; INTER-AREA TRANSFERS FROM NORTH AMERICA TO ASIA AND EUROPE OF $77 MILLION IN 1994, $38 MILLION IN 1993 AND ZERO IN 1992; AND INTER-AREA TRANSFERS FROM EUROPE TO NORTH AMERICA, ASIA AND LATIN AMERICA OF $20 MILLION IN 1994, $16 MILLION IN 1993 AND ZERO IN 1992. THE COST REDUCTION PROGRAM CHARGE INCLUDED IN OPERATING INCOME FOR 1993 IS RELATED TO THE FOOD PRODUCTS SEGMENT. THE COST REDUCTION PROGRAM CHARGE INCLUDED IN OPERATING INCOME FOR 1992 IS ALLOCABLE TO THE FOLLOWING SEGMENTS: FOOD PRODUCTS -- $43 MILLION, REAL ESTATE -- $3 MILLION. 29 NOTE 14 -- QUARTERLY FINANCIAL INFORMATION (UNAUDITED) The following table presents summarized quarterly results.
FIRST SECOND THIRD FOURTH (IN THOUSANDS, EXCEPT PER SHARE DATA) QUARTER QUARTER QUARTER QUARTER YEAR ------------------------------------------------------------------------------------------------------------- 1994 Revenue $818,782 $986,947 $1,081,362 $954,475 $3,841,566 Gross margin 146,479 167,594 160,541 127,911 602,525 Net income 29,749 35,653 1,285 1,196 67,883 ------------------------------------------------------------------------------------------------------------- Earnings per common share $ .50 $ .60 $ .02 $ .02 $ 1.14 ------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------- 1993 Revenue $766,488 $863,653 $1,005,791 $794,589 $3,430,521 Gross margin 131,791 159,307 149,203 109,718 550,019 Net income (loss) 53,258 39,656 5,103 (20,128) 77,889 ------------------------------------------------------------------------------------------------------------- Earnings (loss) per common share $ .89 $ .66 $ .09 $ (.34) $ 1.30 ------------------------------------------------------------------------------------------------------------- -------------------------------------------------------------------------------------------------------------
OPERATING RESULTS FOR THE FOURTH QUARTER OF 1993 INCLUDE A $42.5 MILLION ($26.7 MILLION, NET OF TAX) CHARGE FOR THE COMPANY'S COST REDUCTION PROGRAM. ALL QUARTERS HAVE TWELVE WEEKS, EXCEPT THE THIRD QUARTERS OF BOTH YEARS WHICH HAVE SIXTEEN WEEKS. NOTE 15 -- COMMON STOCK DATA (UNAUDITED) The following table shows the market price range of the Company's common stock for each quarter in 1994 and 1993.
HIGH LOW ------------------------------------------------------------ 1994 First Quarter $35 1/2 $26 3/8 Second Quarter 34 1/2 26 1/8 Third Quarter 30 3/4 26 1/4 Fourth Quarter 28 3/8 22 1/2 ------------------------------------------------------------ Year $35 1/2 $22 1/2 ------------------------------------------------------------ ------------------------------------------------------------ 1993 First Quarter $35 1/2 $30 1/4 Second Quarter 37 7/8 32 1/4 Third Quarter 37 1/2 30 3/8 Fourth Quarter 31 3/4 25 7/8 ------------------------------------------------------------ Year $37 7/8 $25 7/8 ------------------------------------------------------------ ------------------------------------------------------------
NOTE 16 -- SUBSEQUENT EVENTS On January 5, 1995, the Company signed a letter of intent to sell its worldwide fruit juice business (except for its canned pineapple juice business) to The Seagram Company Ltd., owner of Tropicana Products, Inc., for approximately $285 million. In connection with the transaction, the Company will license the Dole brand name to Tropicana. The transaction, which is subject to negotiating a definitive purchase agreement and appropriate government approvals, is expected to close during the second quarter of 1995 and result in a substantial gain. Net proceeds from the proposed sale will be used to repay outstanding bank indebtedness. Revenues related to the fruit juice business totaled approximately $300 million in 1994. On March 7, 1995, the Company signed a letter of intent to sell its California-based dried fruit business to Sun Diamond Growers of California, a grower cooperative, for approximately $100 million. The Company will license the Dole brand name to Sun Diamond for raisins, prunes and dates. The sale, which is subject to negotiating a definitive purchase agreement and appropriate government approvals, is expected to close during the second quarter of 1995. Net proceeds from the proposed sale will be used to repay outstanding bank indebtedness. Revenues related to the California-based dried fruit business totaled approximately $140 million in 1994. 30 DOLE FOOD COMPANY, INC. REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Shareholders and Board of Directors of Dole Food Company, Inc.: We have audited the accompanying consolidated balance sheets of Dole Food Company, Inc., (a Hawaii corporation) and subsidiaries as of December 31, 1994 and January 1, 1994, and the related consolidated statements of income and cash flow for the years ended December 31, 1994, January 1, 1994 and January 2, 1993. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Dole Food Company, Inc. and subsidiaries as of December 31, 1994 and January 1, 1994, and the results of their operations and their cash flow for the years ended December 31, 1994, January 1, 1994 and January 2, 1993, in conformity with generally accepted accounting principles. /s/ Arthur Andersen LLP Los Angeles, California January 30, 1995 (except with respect to the matter discussed in Note 16, as to which the date is March 7, 1995) 31 DOLE FOOD COMPANY, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL POSITION 1994 COMPARED WITH 1993 -- REVENUE -- Consolidated revenue for 1994 increased $411 million, or 12% over the prior year, reaching a record $3.8 billion compared to $3.4 billion for 1993. The Company's food operations contributed approximately $390 million in revenue growth in 1994. This increase was primarily attributable to new businesses acquired at the end of 1993 and in 1994 which added approximately $130 million of revenues, and to expansions of existing product lines. Revenues for the Company's real estate operations were higher in 1994 primarily related to increased home closings and higher average prices for the Hawaiian residential developments. SELLING, MARKETING AND ADMINISTRATIVE EXPENSES -- Selling, marketing and administrative expenses increased from $365 million in 1993 to $429 million in 1994, largely due to the effects of acquired businesses and other business expansions, as well as additional promotions and marketing programs for the fresh vegetable and packaged foods operations. OPERATING INCOME -- Consolidated operating income totaled $174 million in 1994 and $185 million in 1993 before the 1993 pretax charge of $43 million for the Company's cost reduction program. Operating income for the Company's food operations, net of corporate general and administrative expenses, totaled $138 million in 1994 compared to $161 million in 1993 before the cost reduction charge. Worldwide banana results increased in 1994, despite the weak Pacific Rim banana market which resulted from a continued oversupply of product. In early 1995, market conditions in the Pacific Rim continued to be weak. The European Union ("EU") banana regulations which impose quotas and tariffs on bananas were in full effect in 1994 and continue to be in effect in 1995. In addition, beginning in 1995, four Latin American countries (Costa Rica, Colombia, Nicaragua and Venezuela) will implement an agreement with the EU to receive a guaranteed share of the import quotas. Regulations governing this agreement are expected to be published in the first quarter of 1995 and could result in higher costs of operations for the Company due to additional license requirements and export fees that may be imposed. As part of the agreement, the basic EU import quota will be increased 10% and the tariff decreased approximately 35%. The EU quota will receive a second increase to accommodate an additional 20 million consumers when Norway, Sweden and Austria join the EU effective January 1995. Regulations governing the issuance of licenses to control this new volume are also expected to be published in the first quarter of 1995. The net impact of these changing regulations on Dole's future results of operations is not determinable at this time. The improvement in banana earnings was offset by declines in other food operations. The fresh vegetable group reported lower results in 1994 primarily due to poor market conditions for lettuce and celery which existed for the first three quarters of the year. Due to their susceptibility to market fluctuations, program sizes for lettuce and celery have been reduced. Results for processed pineapple were also lower in 1994 compared to 1993, although price pressures resulting from heavy industry supplies experienced in the prior year and for most of 1994 began to improve at the end of 1994. Lower operating income in 1994 was also attributable to the dried fruit and nut operations. In addition, operating income for 1993 included a pretax gain of approximately $9 million related to the sale of the Company's interest in the California and Hawaiian Sugar Company. Dole distributes its products in more than 80 countries throughout the world. Its international sales are usually transacted in U.S. dollars and major European and Asian currencies, while many of its costs are incurred in currencies different from those that are received from the sale of the product. As the Company has not historically entered into forward foreign exchange contracts, results of operations may be significantly affected by fluctuations of currency exchange rates in both the sourcing and selling locations. The overall net impact of foreign currency fluctuations was immaterial to the results of operations in 1994 and 1993. Operating income for the Company's real estate operations totaled $73 million in 1994 and $64 million in 1993. Residential real estate development operations reported operating income for 1994 of $61 million compared to $56 million for 1993. The higher earnings were primarily attributable to increased home closings in the Hawaiian developments, as well as an increase in lot deliveries in California. While strong earnings were posted in 1994, a soft Hawaiian economy, combined with an increase in mortgage interest rates and competition, could impact results for the residential real estate operations in 1995. The Lana'i resort operations continued to report improved occupancy rates at both hotels, resulting in an operating loss before depreciation of $19 million for 1994 as compared to $24 million in 1993. Depreciation expense was $18 million and $16 million in 1994 and 1993, respectively. INTEREST EXPENSE, NET -- Interest expense, net of interest income and capitalized interest, increased to $77 million in 1994 from $59 million in 1993 due to higher average debt levels and higher interest rates. OTHER EXPENSE, NET -- Other expense decreased in 1994, primarily the result of lower minority interest expense due to a smaller minority share at the Company's Latin American beverage operation and lower earnings for the Company's citrus operations. INCOME TAXES -- The Company's effective income tax rate increased to 23.0% in 1994 from 20.6% in 1993, primarily as a result of an increase in earnings reported in higher tax rate jurisdictions relative to total earnings before tax. 32 1993 COMPARED WITH 1992 -- REVENUE -- Consolidated revenue increased $55 million from 1992 to 1993, to over $3.4 billion. Revenues for the food operations in 1993 and 1992 were level, accounting for just over 90% of consolidated net sales. New businesses acquired in early 1993 accounted for approximately $100 million of revenue growth. Banana revenues generated in the Company's North America and Pacific Rim markets were down in 1993 due to lower prices. Revenues in the European market were also lower as volumes into the European Union were limited due to the new EU banana regulations. Overall, the Company's worldwide banana volumes were comparable in 1993 and 1992. Improvements in 1993 revenue were noted for the fresh vegetable business, attributable to higher lettuce and celery prices. This increase was offset by declines in citrus revenues due to lower volumes and in fresh and packaged pineapple sales due to lower prices. The Company's residential real estate operations reported higher revenue in 1993 as home deliveries for both Hawaii and California increased by 46% in 1993 compared to 1992, partially offset by lower average home prices. SELLING, MARKETING AND ADMINISTRATIVE EXPENSES -- Selling, marketing and administrative expenses increased 11% from $328 million in 1992 to $365 million in 1993. The effect of new acquisitions, plus additional spending for new products and marketing programs for the fresh vegetable and packaged foods operations more than offset savings achieved through cost reduction measures. COST REDUCTION PROGRAM -- As part of its emphasis on cost reduction efforts, Dole targeted the closure of certain of its businesses which had suffered continuing losses. These included its Hawaiian sugar operations, its Argentina deciduous operation, its Philippine shrimp farming operation and a vegetable packing house. In addition, under Dole's newly implemented management structure, certain functions within each of four global regions, North America, Latin America, Asia and Europe, were streamlined and consolidated, resulting in labor savings. One-time costs associated with the above mentioned operational closures and other actions totaled $43 million on a pretax basis and were recorded in the 1993 fourth quarter results. The charge included provisions for severance payments and other employee related expenses, facilities consolidation costs, and other related expenses, as well as write-downs of non-recoverable assets resulting from the decision to close the above operations. OPERATING INCOME -- Consolidated operating income, before cost reduction charges, was $185 million in both 1993 and 1992. Operating income for the Company's food operations, net of corporate general and administrative expenses and before the 1993 and 1992 charges for cost reduction programs, totaled $161 million in 1993 compared to $173 million in 1992. During 1993, the food operations experienced price pressures on some of its products, resulting in lower earnings. However, the successful implementation of cost reduction efforts throughout the Company partially offset a portion of these earnings declines. Cost reductions achieved during 1993 were significant, totaling approximately $130 million, including a substantial reduction in the Company's worldwide labor force. Marginally productive banana lands were abandoned and various agricultural and harvesting practices were modified to be more cost effective. The efficiency of the Company's shipping service between Latin America and North America was significantly improved. The Company's citrus and deciduous businesses were consolidated in Bakersfield, several citrus packing houses and an underutilized facility in Bakersfield were closed, and the packaged foods headquarters were relocated from San Francisco to Westlake Village, California. Tighter inventory controls and new supplier contracts also contributed significantly to 1993's cost reductions. Banana earnings, which accounted for a significant portion of operating income were lower than in 1992 due to several factors. The new EU banana regulations which impose quotas on bananas exported from Latin America to the EU were implemented on July 1, 1993. These regulations disrupted traditional trading patterns causing banana volumes displaced by the EU restrictions to be shipped into North American and non-EU European banana markets, resulting in lower prices in the affected markets. Earnings were also lower in the Pacific Rim markets due to the recession in Japan and increased industry volumes. Another condition which affected the 1993 banana results was an outbreak in the Company's farms in Honduras of sigatoka, a fungus which attacks banana plants. This resulted in reduced volumes and increased fruit costs from that source in the second half of 1993. Steps were taken to control the disease and by year-end 1993, growing costs had returned to more normal levels. In addition, operating income for the fourth quarter of 1992 included an insurance recovery of approximately $15 million related to the 1991 Costa Rican earthquake. The packaged foods and fresh pineapple operations also reported lower earnings in 1993. Price pressures for canned pineapple resulted from heavy industry supplies and a drop in demand in Europe and Japan due to recessions in those areas. Prices were also lower in 1993 for Dole's beverage products due to strong competition from lower-priced orange juice, and for fresh pineapple due to the recession. Lower 1993 earnings for bananas and pineapples were partially offset by the strong performance of the fresh vegetable operations resulting primarily from higher lettuce and celery prices and improvements in cost structure. Improved 1993 results were also reported for California table grapes as sales prices were up from 1992 levels. Operating income for the Company's real estate operations totaled $64 million in 1993 and $53 million in 1992. Residential real estate operations reported operating income for 1993 of $56 million compared to $52 million for 1992. Higher earnings in 1993 were primarily attributable to an increase in the number of units sold at the Hawaiian developments, partially offset by lower earnings for the California developments. 33 The Lana'i resorts operations reported an operating loss before depreciation of $24 million for 1993 as compared to $26 million in 1992, with improved occupancy rates for both hotels in 1993. Depreciation expense was approximately $16 million and $15 million in 1993 and 1992, respectively. GAIN ON SALE OF SUBSIDIARY COMMON STOCK -- On March 4, 1993, approximately 18% of the common stock of Castle & Cooke Homes, Inc. was sold at $15 per share through an initial public offering. Net proceeds from the sale totaled approximately $74 million and resulted in a gain of approximately $31 million ($18 million, net of tax). INTEREST EXPENSE, NET -- Interest expense, net of interest income and capitalized interest, increased to $59 million in 1993 from $57 million in 1992, primarily attributable to higher average debt levels offset by a lower weighted average borrowing rate, and a decline in interest income. INCOME TAXES -- The Company's effective income tax rate increased to 20.6% for 1993 from 8.9% in 1992, primarily as a result of a change in the mix of domestic and foreign earnings, largely due to the inclusion of the gain on the initial public offering of Castle & Cooke Homes, Inc. In addition, the higher federal income tax rates enacted in August 1993 required the Company to provide additional taxes on its 1993 domestic earnings, as well as on its net deferred tax liability. LIQUIDITY AND CAPITAL RESOURCES In 1994, the Company's operational needs and investment activities were financed through a combination of internally generated funds and external borrowings. Cash and short-term investments totaled $47 million at December 31, 1994 and $37 million at January 1, 1994. Cash flow provided by operations totaled $70 million for 1994 compared to $131 million in 1993. The decrease was primarily attributable to higher receivable levels related to increased sales, partially offset by higher accounts payable and accrued liabilities related to the increased activity levels. In addition, in 1994 there was increased spending for real estate developments, primarily in Hawaii for infrastructure at the Royal Kunia development and for the acquisition of a 22 acre parcel on Oahu for approximately $12 million. The Company's working capital increased to $641 million at the end of 1994 compared to $482 million at the end of 1993. Cash flow from financing activities totaled $344 million in 1994 compared to $158 million in 1993. On May 10, 1994, the Company entered into a $1 billion revolving credit agreement ("Facility") for a five-year term which replaced the previous $400 million credit facility. At the Company's option, borrowings under the Facility bear interest at the agent's prime rate or at a certain percentage over the London Interbank Offered Rate ("LIBOR"). At December 31, 1994, the Company had approximately $200 million of borrowing capacity under the Facility. The Company also borrows under uncommitted lines of credit at rates offered from time to time by various banks that may or may not be lenders under the $1 billion credit facility. At December 31, 1994, net borrowings under the uncommitted lines of credit totaled approximately $65 million. As discussed in the Notes to Consolidated Financial Statements, the Company also had outstanding at December 31, 1994, $700 million of public unsecured notes which were issued in 1993. These notes bear interest at 6.75%, 7% and 7.875% and mature in years 2000, 2003 and 2013. In connection with the 1993 initial public offering, Castle & Cooke Homes, Inc. entered into a $100 million revolving credit facility with a group of banks. The credit facility was subsequently amended to increase available borrowings from $100 million to $135 million. During the fourth quarter of 1994, amounts outstanding under this facility were refinanced with borrowings from the Company's $1 billion credit facility, at which time the Castle & Cooke Homes, Inc. revolving credit agreement was terminated. Funds expended for the Company's investment activities in 1994 totaled $404 million. During the fourth quarter, the Company acquired the minority shareholders' interest in Castle & Cooke Homes, Inc. through a cash tender offer for $15.75 per share, or for an aggregate purchase price of $85 million including related expenses. Capital expenditures for 1994 totaled approximately $240 million, of which $212 million was invested in the Company's food operations for infrastructure, further development and modernization of new and existing facilities, and new vessels. The Company also invested $19 million for the Lana'i resort project, primarily for the completion of the Manele Bay Golf Course and clubhouse. During 1994, the Company acquired various businesses for an aggregate purchase price of approximately $94 million. These acquisitions included a 35% interest in a produce distribution company in the United Kingdom, as well as various other food and food related operations. The Company also purchased three commercial real estate properties. The Company paid four quarterly dividends of 10 cents per share on its common stock totaling approximately $24 million in 1994. On January 5, 1995, the Company signed a letter of intent to sell its worldwide fruit juice business (except for its canned pineapple juice business) to The Seagram Company Ltd., owner of Tropicana Products, Inc., for approximately $285 million. In connection with the transaction, the Company will license the Dole brand name to Tropicana. The transaction, which is subject to negotiating a definitive purchase agreement and appropriate government approvals, is expected to close during the second quarter of 1995 and result in a substantial gain. Net proceeds from the proposed sale will be used to repay outstanding bank indebtedness. Revenues related to the fruit juice business totaled approximately $300 million in 1994. On March 7, 1995, the Company signed a letter of intent to sell its California-based dried fruit business to Sun Diamond Growers of California, a grower cooperative, for approximately $100 million. The Company will license the Dole brand name to Sun Diamond for raisins, prunes and dates. The sale, which is subject to negotiating a definitive purchase agreement and appropriate government approvals, is expected to close during the second quarter of 1995. Net proceeds from the proposed sale will be used to repay outstanding bank indebtedness. Revenues related to the California-based dried fruit business totaled approximately $140 million in 1994. 34 DOLE FOOD COMPANY, INC. RESULTS OF OPERATIONS AND SELECTED FINANCIAL DATA
(IN MILLIONS, EXCEPT PER SHARE DATA) 1994 1993 1992 1991 1990 ----------------------------------------------------------------------------------------------------------- Revenue $3,842 $3,431 $3,376 $3,216 $3,003 Cost of products sold 3,239 2,881 2,863 2,636 2,419 ----------------------------------------------------------------------------------------------------------- Gross margin 603 550 513 580 584 Selling, marketing and administrative expenses 429 365 328 356 355 Cost reduction program -- 43 46 -- -- ----------------------------------------------------------------------------------------------------------- Operating income 174 142 139 224 229 Interest expense -- net (77) (59) (57) (50) (42) Gain on sale of subsidiary stock or investment -- 31 -- -- 8 Other expense -- net (9) (16) (11) (5) (7) ----------------------------------------------------------------------------------------------------------- Income before income taxes and accounting change 88 98 71 169 188 Income taxes (20) (20) (6) (35) (68) ----------------------------------------------------------------------------------------------------------- Income before accounting change 68 78 65 134 120 Cumulative effect of accounting change -- -- (49) -- -- ----------------------------------------------------------------------------------------------------------- Net income $ 68 $ 78 $ 16 $ 134 $ 120 ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- Earnings per common share, fully diluted Income before accounting change $ 1.14 $ 1.30 $ 1.09 $ 2.24 $ 2.03 Cumulative effect of accounting change -- -- (.83) -- -- ----------------------------------------------------------------------------------------------------------- Net income $ 1.14 $ 1.30 $ .26 $ 2.24 $ 2.03 ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- Other statistics Working capital $ 641 $ 482 $ 421 $ 466 $ 309 Total assets 3,849 3,388 3,095 2,878 2,499 Long-term debt 1,555 1,158 988 813 542 Total debt 1,609 1,237 1,102 889 638 Common shareholders' equity 1,081 1,052 1,001 1,009 897 Annual cash dividends per common share .40 .40 .40 .40 .10 Capital additions 240 219 192 325 247 Depreciation and amortization 148 133 110 87 72 ----------------------------------------------------------------------------------------------------------- -----------------------------------------------------------------------------------------------------------
35 COMPANY AND SHAREHOLDER INFORMATION THE COMPANY Founded in Hawaii in 1851, Dole Food Company, Inc. is the world's largest producer and marketer of fresh fruits and vegetables, and markets a growing line of packaged foods. It is also a major real estate owner and developer in Hawaii, California and Arizona. The Company does business in more than 80 countries and employs approximately 46,000 full-time people worldwide. CORPORATE HEADQUARTERS 31355 Oak Crest Drive Westlake Village, CA 91361 (818) 879-6600 AUDITORS Arthur Andersen LLP 633 West Fifth Street Los Angeles, CA 90071 SECURITIES TRANSFER AGENT The First National Bank of Boston P.O. Box 644 Boston, MA 02102 SHAREHOLDER INQUIRIES Shareholders and members of the investment industry should direct inquiries to: Office of the Corporate Secretary Dole Food Company, Inc. 31355 Oak Crest Drive Westlake Village, CA 91361 (818) 879-6600 FORM 10-K A copy of Dole Food Company, Inc.'s Form 10-K, a corporate operational and financial report filed annually with the Securities and Exchange Commission, is available upon request without charge. STOCK EXCHANGE Dole Food Company, Inc.'s common stock (DOL) is traded on the New York and Pacific Stock Exchanges. The financial pages of this annual report are printed on recycled paper. Dole is a registered trademark of Dole Food Company, Inc. Made In Nature, Dromedary Dried Fruit Company, Looza Distribution N.V., Juice Bowl Products, Inc., The Lodge at Koele, The Manele Bay Hotel, The Experience at Koele and The Challenge at Manele are trademarks and service marks of Dole Food Company, Inc. and/or its affiliates. -C- 1995 Dole Food Company, Inc. All rights reserved. EX-22 5 EXHIBIT 22 SUBSIDIARIES OF DOLE EXHIBIT 22 SUBSIDIARIES OF DOLE FOOD COMPANY, INC. --------------------------------------- There are no parents of the Registrant. Registrant's consolidated subsidiaries are shown below together with the percentage of voting securities owned and the state or jurisdiction of organization of each subsidiary. The names have been omitted for subsidiaries which, if considered in the aggregate as a single subsidiary, do not constitute a significant subsidiary. Subsidiaries of subsidiaries are indented in the following table: Percent of Outstanding Voting Securities Owned as of Subsidiaries of Registrant December 31, 1994 -------------------------- -------------------- Castle & Cooke Fresh Fruit Company 100% (Nevada) ABA Holding,Inc. 100% (New Jersey) Juice Bowl Products, Inc. 100% (Florida) Looza Distribution N.V. 100% (Belgium) Beebe Orchard Company 100% (Delaware) Dole Citrus 100% (California) Dole Fresh Fruit Company 100% (Nevada) Dole Europe Company 100% (Delaware) 1 Percent of Outstanding Voting Securities Owned as of Subsidiaries of Registrant December 31, 1994 -------------------------- ------------------ Castle & Cooke Fresh Fruit Company (cont'd) Dole Fresh Fruit Europe Ltd. & Co. 100% (Federal Republic of Germany) Dole Fresh Fruit International, Inc. 100% (Panama) Standard Fruit Company 100% (Delaware) Cerveceria Hondurena, S.A. 80% (Honduras) Standard Fruit Company de Costa Rica, S.A. 100% (Costa Rica) Standard Fruit and Steamship Company 100% (Delaware) Wells & Wade Fruit Company 100% (Washington) Castle & Cooke Worldwide Limited 100% (Hong Kong) Dole Fresh Fruit International, Limited 100% (Liberia) Solvest, Ltd. 100% (Bermuda) 2 Percent of Outstanding Voting Securities Owned as of Subsidiaries of Registrant December 31, 1994 -------------------------- -------------------- Castle & Cooke Worldwide Limited (cont'd) Standard Fruit de Honduras, S.A. 100% (Honduras) Dole Europe B.V. 100% (Netherlands) Soleil Holding France S.A. 100% (France) SAMICA, S.A. 100% (France) Dole Chile S.A. 100% (Chile) Dole Thailand Limited 64% (Thailand) Compania Financiera de Costa Rica, S.A. 100% (Costa Rica) Dole Bakersfield, Inc. 100% (California) Dole Dried Fruit and Nut Company 100% (California) Dole Fresh Vegetables, Inc. 100% (California) Bud Antle, Inc. 100% (California) 3 Percent of Outstanding Voting Securities Owned as of Subsidiaries of Registrant December 31, 1994 -------------------------- -------------------- Dole Carrot Company 100% (California) Royal Packing Co. 100% (California) Dole Japan, Ltd. 100% (Japan) Dole Land Company, Inc. 100% (Hawaii) Dole Mega Holding Corp. 100% (Hawaii) Mega Properties Partnership 1% (a Delaware general partnership) Dole Mega Trust 99% (a Delaware business trust) Mega Properties Partnership 99% (a Delaware general partnership) Dole Philippines, Inc. 99% (Republic of the Philippines) Earlibest Orange Association, Inc. 100% (California) S & J Ranch, Inc. 100% (California) Dole Nut Company 100% (California) 4 Percent of Outstanding Voting Securities Owned as of Subsidiaries of Registrant December 31, 1994 -------------------------- -------------------- M K Development, Inc. 100% (Hawaii) Lana'i Resort Partners 98% (a California general partnership) Castle & Cooke Properties, Inc. 100% (Hawaii) Castle & Cooke Homes, Inc. 61% (Hawaii) Castle & Cooke Homes Hawaii, Inc. 100% (Hawaii) Castle & Cooke California, Inc. 100% (California) Castle & Cooke Communities, Inc. 100% (Hawaii) Castle & Cooke Bakersfield Holdings, Inc. 100% (Delaware) Castle & Cooke Homes, Inc. 39% (Hawaii) Castle & Cooke Homes, Inc. 100% (California) Waialua Sugar Company, Inc. 100% (Hawaii) 5 EX-23 6 EXHIBIT 23 CONSENT OF ARTHUR ANDERSON Exhibit 23 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation of our reports included (or incorporated by reference) in this Form 10-K into Dole Food Company, Inc.'s previously filed Registration Statements on Form S-3 Registration Nos. 33-41480 and 33-64984 and Form S-8 Registration Nos. 2-87475, 33-594, 33-28782 and 33-42152. Arthur Andersen LLP Los Angeles, California March 30, 1995 EX-27 7 EXHIBIT 27 FINANCIAL DATA SCHEDULE
5 1,000 12-MOS DEC-31-1994 JAN-02-1994 DEC-31-1994 46,566 0 394,806 35,898 558,400 1,345,999 2,523,205 596,752 3,848,682 705,126 1,554,504 320,121 0 0 760,520 3,848,682 3,841,566 3,841,566 3,239,041 3,239,041 0 13,585 88,930 88,183 20,300 67,883 0 0 0 67,883 1.14 1.14 THE COMPANY'S FISCAL YEAR ENDS ON THE SATURDAY CLOSEST TO DECEMBER 31. FISCAL YEAR 1994 CONSISTED OF 52 WEEKS AND ENDED ON DECEMBER 31, 1994. ALL QUARTERS IN 1994 HAVE 12 WEEKS, EXCEPT THE THIRD QUARTER OF 1994 WHICH HAS 16 WEEKS. INCLUDES TRADE RECEIVABLES ONLY. INCLUDES AMOUNTS RELATED TO TRADE RECEIVABLES AND CURRENT NOTES RECEIVABLE.