-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CUtlddMZZCWznVVtAJRDLnDhCdqBCMmVLY8q9b7IJiFVBqU3hgA3tDSfbJSSuvTk hssetIOl+PkifOsQHxlC+g== 0000897069-98-000291.txt : 19980515 0000897069-98-000291.hdr.sgml : 19980515 ACCESSION NUMBER: 0000897069-98-000291 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980331 FILED AS OF DATE: 19980514 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHRISTIANA COMPANIES INC CENTRAL INDEX KEY: 0000020104 STANDARD INDUSTRIAL CLASSIFICATION: PUBLIC WAREHOUSING & STORAGE [4220] IRS NUMBER: 951928079 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-03846 FILM NUMBER: 98619560 BUSINESS ADDRESS: STREET 1: 777 E WISCONSIN AVE STE 3380 CITY: MILWAUKEE STATE: WI ZIP: 53202 BUSINESS PHONE: 4142919000 FORMER COMPANY: FORMER CONFORMED NAME: CHRISTIANA OIL COMPANIES DATE OF NAME CHANGE: 19711004 FORMER COMPANY: FORMER CONFORMED NAME: CHRISTIANA OIL CORP DATE OF NAME CHANGE: 19710420 10-Q 1 CHRISTIANA COMPANIES, INC. SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 Form 10-Q x QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended March 31, 1998 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the transition period from ________________to _______________ Commission File Number 1-3846 CHRISTIANA COMPANIES, INC. (Exact name of registrant as specified in its charter.) Wisconsin 95-1928079 (State of Incorporation) (IRS Employer Identification No.) 700 N. Water Street, Suite 1200, Milwaukee, WI 53202 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (414) 291-9000 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Common Stock $1.00 par value 5,149,330 (Class) (Outstanding at May 12, 1998) Page 1 of 12 total pages No exhibits are filed with this report. PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS CHRISTIANA COMPANIES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited) (Audited) March 31, June 30, 1998 1997 ASSETS: Cash and cash equivalents $ 5,290,000 $ 2,888,000 Short-term investments - 4,611,000 Accounts receivable 8,169,000 7,649,000 Prepaids and other current assets 1,734,000 1,729,000 ------------ ----------- Total Current Assets 15,193,000 16,877,000 ------------ ----------- Long-Term Assets: Investment in EVI, Inc. 47,268,000 41,257,000 Mortgage notes receivable 1,231,000 1,749,000 Fixed assets, net 72,301,000 75,604,000 Other long-term assets 6,771,000 6,869,000 ------------ ----------- Total Long-Term Assets 127,571,000 125,479,000 ------------ ----------- $142,764,000 $142,356,000 ============ =========== LIABILITIES AND SHAREHOLDERS' EQUITY: Current Liabilities: Accounts payable 4,081,000 3,526,000 Accrued liabilities 4,815,000 5,562,000 Short term debt 159,000 - Current portion of long-term debt 1,245,000 3,531,000 ------------ ----------- Total Current Liabilities 10,300,000 12,619,000 ------------ ----------- Long-Term Liabilities Long-term debt 31,167,000 36,149,000 Deferred federal and state income taxes 23,518,000 20,289,000 Other liabilities 1,181,000 1,214,000 ------------ ----------- Total Long-Term Liabilities 55,866,000 57,652,000 ------------ ----------- Total Liabilities 66,166,000 70,271,000 ------------ ----------- Shareholders' Equity: Preferred Stock - - Common stock, par value $1 per share; Authorized 12,000,000 shares; Issued 5,208,330 5,209,000 5,196,000 Additional paid-in capital 12,346,000 12,022,000 Less: Treasury stock, at cost (1,236,000) (1,236,000) Retained earnings 60,279,000 56,103,000 ------------ ----------- Total Shareholders' Equity 76,598,000 72,085,000 ------------ ----------- $142,764,000 $142,356,000 ============ =========== See notes to consolidated financial statements. CHRISTIANA COMPANIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Nine Months Ended Three Months Ended March 31, March 31, 1998 1997 1998 1997 Revenues: Warehousing and logistic services $68,579,000 $63,271,000 $21,865,000 $22,450,000 ----------- ----------- ----------- ----------- Costs and Expenses: Warehousing and logistic services 57,843,000 53,051,000 18,526,000 19,138,000 Selling, general and administrative 6,615,000 6,114,000 2,273,000 2,219,000 ----------- ------------ ---------- ----------- 64,458,000 59,165,000 20,799,000 21,357,000 ----------- ------------ ---------- ----------- Earnings from Operations 4,121,000 4,106,000 1,066,000 1,093,000 Other Income (Expense): Interest income 349,000 376,000 101,000 119,000 Interest expense (2,150,000) (2,437,000) (658,000) (770,000) Gain (losses) on sales of real estate - 279,000 - - Equity in earnings of EVI, Inc. 6,011,000 8,855,000 2,564,000 1,219,000 Loss on disposal of assets (17,000) (1,281,000) (24,000) - Other income (expenses), net (1,434,000) (336,000) (48,000) 10,000 ------------ ----------- ----------- ----------- 2,759,000 5,456,000 1,935,000 578,000 ------------ ----------- ----------- ----------- Earnings before income taxes 6,880,000 9,562,000 3,001,000 1,671,000 Income tax provision 2,704,000 3,731,000 1,168,000 652,000 ------------ ----------- ----------- ----------- Net earnings $ 4,176,000 $ 5,831,000 $ 1,833,000 $ 1,019,000 ============ =========== =========== =========== Basic earnings per share $0.81 $1.14 $0.36 $0.20 ============ =========== =========== =========== Diluted earnings per share $0.80 $1.13 $0.35 $0.20 ============ =========== =========== =========== Average number of shares outstanding 5,142,980 5,136,630 5,149,330 5,136,630 See notes to consolidated financial statements.
CHRISTIANA COMPANIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
Additional Common Stock Treasury Stock Paid-in Retained Shares Amount Shares Amount Capital Earnings Balance, June 30, 1996 5,195,630 $5,196,000 (59,000) $(1,236,000) $12,022,000 $45,095,000 --------- ---------- --------- ------------ ----------- ----------- EVI stock issuance - - - - - 4,345,000 Net earnings - - - - - 6,663,000 --------- ---------- --------- ------------ ----------- ----------- Balance, June 30, 1997 5,195,630 $5,196,000 (59,000) $(1,236,000) $12,022,000 $56,103,000 Common shares issued 12,700 13,000 - - 324,000 - Net earnings (Unaudited) - - - - - 4,176,000 --------- ---------- --------- ------------ ----------- ----------- Balance, March 31, 1998 5,208,330 $5,209,000 (59,000) $(1,236,000) $12,346,000 $60,279,000 ========= ========== ========= ============ =========== =========== See notes to consolidated financial statements.
CHRISTIANA COMPANIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) Nine Months Ended March 31, 1998 1997 CASH FLOWS FROM OPERATING ACTIVITIES: Net earnings $4,176,000 $ 5,831,000 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization 4,951,000 5,432,000 Loss on sales of assets 17,000 1,002,000 Deferred income tax expenses 3,229,000 3,693,000 Equity in earnings of EVI, Inc. (6,011,000) (8,855,000) Changes in assets and liabilities: (Increase) in accounts receivable (520,000) (637,000) Decrease in other assets 6,000 580,000 (Decrease) in accounts payable and accrued liabilities (192,000) (713,000) ------------ ------------ Net cash provided by operating activities 5,656,000 6,333,000 CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from sale of assets 308,000 2,242,000 Decrease in mortgage notes receivable 518,000 1,477,000 (Increase) decrease in short-term investments, net 4,611,000 (5,621,000) Capital expenditures (1,919,000) (2,306,000) ------------ ------------ Net cash provided by (used in) investing activities 3,518,000 (4,208,000) CASH FLOWS FROM FINANCING ACTIVITIES: Net borrowings (repayments) on long-term notes and credit lines 159,000 (1,684,000) Payments of notes and loans payable (7,268,000) (3,447,000) Issuance of common stock 337,000 - ------------ ------------ Net cash (used in) financing activities (6,772,000) (5,131,000) ------------ ------------ NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 2,402,000 (3,006,000) BEGINNING CASH AND CASH EQUIVALENTS, July 1 2,888,000 3,728,000 ------------ ------------ ENDING CASH AND CASH EQUIVALENTS, March 31 $ 5,290,000 $ 722,000 ============ ============ Supplemental disclosures of cash flow information: Interest paid $ 2,150,000 $ 2,398,000 Income taxes paid $ 395,000 $ 381,000 See notes to consolidated financial statements. CHRISTIANA COMPANIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 - ACCOUNTING POLICIES The accompanying unaudited financial statements reflect all adjustments which are, in the opinion of management, necessary to fairly present the results for the interim periods presented and should be read in conjunction with the Company's 1997 Annual Report. NOTE 2 - ENERGY VENTURES, INC. STOCK ISSUANCE The Company accounts for its investment in EVI under the equity method of accounting. In July 1996, the Company's share of the underlying net assets of EVI increased $7,146,000 as a result of a public offering of EVI's common stock. This was recorded as an increase of $4,345,000 in retained earnings, and a $2,801,000 increase in deferred income taxes. NOTE 3 MERGER AGREEMENT The Company and EVI, Inc. executed a definitive merger agreement, dated December 12, 1997, under which EVI will acquire all the outstanding common shares of the Company. The terms of the merger provide that each Christiana common share will be converted into approximately .74193 shares of EVI common stock, cash in the approximate amount of $3.60, depending on the balance of certain assets and liabilities at the time of closing and a contingent cash payment of approximately $1.92 after five years, subject to the incurrance of any indemnity claims by EVI during this period. The merger transaction is subject to the approval of shareholders of both EVI and the Company as well as customary regulatory approvals. Completion of the merger is expected in July 1998. NOTE 4 ACCOUNTING PRONOUNCEMENTS Effective January 1, 1998, the Company adopted Statement of Accounting Standards ("SFAS") No. 130, "Reporting Comprehensive Income." This statement established standards for reporting and display of comprehensive income and its components. Components of comprehensive income are net income and all other non-owner changes in equity. Because the Company has no comprehensive income components other than net income, comprehensive income and net income are identical for all periods presented. Effective January 1, 1998, the Company adopted Statement of Position ("SOP") No. 98-1, "Accounting for the Costs of Computer Software Developed or Obtained for Internal Use." The Company's accounting for costs of computer software developed or obtained for internal use is consistent with the guidance established in the SOP. As a result, adoption of this statement did not have a material impact on the Company's financial position or results of operations. Effective January 1, 1998, the Company adopted SOP 98-5, "Reporting on the Costs of Start-up Activities." This SOP provides guidance on the financial reporting of start-up costs and organization costs. It requires costs of start-up activities and organization costs to be expensed as incurred. Adoption of this statement did not have a material impact on the Company's financial position or results of operations. NOTE 5 EARNINGS PER SHARE
Three Months Ended March 31, Nine Months Ended March 31, 1998 1997 1998 1997 Basic earnings per share: Net income available to common shareholders $1,833,000 $1,019,000 $4,176,000 $5,831,000 ========== ========== ========== ========== Average shares of common stock outstanding 5,149,330 5,136,630 5,142,980 5,136,630 Basic earnings per share $ 0.36 $ 0.20 $ 0.81 $ 1.14 ========== ========== ========== ========== Diluted earnings per share: Average shares of common stock outstanding 5,149,330 5,136,630 5,142,980 5,136,630 Incremental common shares applicable to common stock options 57,434 32,356 68,854 8,402 ---------- --------- ---------- --------- Average common shares assuming full dilution 5,206,764 5,168,986 5,211,834 5,145,032 Diluted earnings per share $ 0.35 $ 0.20 $ 0.80 $ 1.13 ========== ========= ========== =========
ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Operations Christiana Companies consolidated revenues for the three months ended March 31, 1998 were $21,865,000 versus $22,450,000 reported for the comparable period a year ago, a decrease of 2.6%. The decrease in revenues was primarily attributable to reduced dry warehousing operations due to the closure of two facilities in fiscal 1997. Revenues from both refrigerated warehousing and logistic operations increased year to year due to improved utilization of the company's warehouses and transportation equipment. Operating earnings for the quarter were $1,066,000 versus $1,093,000 generated in the comparable period a year ago. The 2.5% decrease in operating earnings is primarily attributable to added expenses in the sales department and reduced gross margin in Dry Warehousing operations. For the third quarter ended March 31, 1998, Equity in Earnings from EVI totaled $2,564,000 attributable to an 8.52% weighted average ownership interest compared to $1,219,000 in the previous year, a 110% increase. The Company's consolidated net earnings for the quarter were $1,833,000 or $0.36 per share ($0.35 diluted) compared with $1,019,000 or $0.20 per share ($0.20 diluted) for the same period a year ago. Net earnings were higher this period due primarily to the increase in Equity in Earnings of EVI. For the first nine months of fiscal 1998, consolidated revenues were $68,579,000 versus $63,271,000 for the comparable period last year, an increase of $5,308,000 or 8.4%. Volume increases in Transportation and Refrigerated Warehousing operations were the principal factors contributing to the increase. Consolidated net earnings for the nine months ended March 31, 1998 were $4,176,000 or $0.81 per share ($0.80 diluted) versus $5,831,000 or $1.14 per share ($1.13 diluted) reported for the comparable period last year. For the nine months ended March 31, 1998, the Company recognized Equity in Earnings from Energy Ventures of $6,011,000 compared to $8,855,000 in the previous year. Prior year results included $5,715,000 attributable to the gain reported by EVI on the sale of Mallard Bay Drilling. Net earnings attributable to the Company's warehousing and logistic operations were $1,588,000 for the nine months ended March 31, 1998 compared to $766,000 for the same period last year. Financial Condition Cash equivalents and short-term investments as of March 31, 1998 totaled $5,290,000 compared to $7,499,000 at June 30, 1997, a decrease of $2,209,000. Christiana's working capital at March 31, 1998 was $4,893,000 compared to $4,258,000 at June 30, 1997. Cash provided by operating activities of $5,656,000 was attributable primarily to net earnings and depreciation, offset by Equity in Earnings of EVI. Cash provided by investment activities of $3,518,000 resulted from a decrease in short-term investments of $4,611,000, capital expenditures of $1,919,000 primarily attributable to warehousing and logistics operations, proceeds from asset sales of $308,000, and the payment of mortgage notes receivable in the amount of $518,000. In the nine month period ended March 31, 1998, funded debt all of which is attributable to Total Logistic Control was reduced by $7,268,000, which was generated by internal cash flow from its operations. In addition, the exercise of stock options resulted in cash flow of $337,000. Christiana's balance sheet at March 31, 1998 reflects $47,268,000 as its carrying value for 3,897,462 shares of EVI common stock. At March 31, 1998, these shares had a market value of $180,501,209 or $35.05 per Christiana share. At March 31, 1998, the Company has no commitments for any material capital projects. PART II - OTHER INFORMATION Item 1. Not applicable. Item 2. Not applicable. Item 3. Not applicable. Item 4. See Item 4 of Form 10-Q for quarter ended 9/30/97. Item 5. Not applicable. Item 6. Exhibits and Reports on Form 8-K None SIGNATURES: Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. CHRISTIANA COMPANIES, INC. (Registrant) Date: May 12, 1998 /s/ Sheldon B. Lubar Sheldon B. Lubar Chairman and Chief Executive Officer Date May 12, 1998 /s/ William T. Donovan William T. Donovan President and Chief Financial Officer EX-27 2
5 1 9-MOS JUN-30-1998 JAN-01-1998 MAR-31-1998 5,290,000 0 485,000 316,000 757,000 15,193,000 102,154,000 29,853,000 142,764,000 10,300,000 31,167,000 0 0 5,209,000 71,389,000 142,764,000 0 21,865,000 0 18,526,000 2,273,000 0 658,000 3,001,000 1,168,000 1,833,000 0 0 0 1,833,000 .36 .35
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