-----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, Liz2bNjVvcyvINLmye/U05EHZVl32hnCFyzDC8egcve5v5u28nz7o+2v+9cHPo6Z aqfv65eKGt3MYU9xoXZZTQ== 0000202356-95-000005.txt : 19951109 0000202356-95-000005.hdr.sgml : 19951109 ACCESSION NUMBER: 0000202356-95-000005 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951108 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: KYSOR INDUSTRIAL CORP /MI/ CENTRAL INDEX KEY: 0000202356 STANDARD INDUSTRIAL CLASSIFICATION: AIR COND & WARM AIR HEATING EQUIP & COMM & INDL REFRIG EQUIP [3585] IRS NUMBER: 381909000 STATE OF INCORPORATION: MI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-08973 FILM NUMBER: 95588111 BUSINESS ADDRESS: STREET 1: ONE MADISON AVE CITY: CADILLAC STATE: MI ZIP: 49601 BUSINESS PHONE: 6167792200 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One)* (x) Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended September 30, 1995 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 1-8973 KYSOR INDUSTRIAL CORPORATION (exact name of registrant as specified in its charter) Michigan (state or other jurisdiction of incorporation or organization) 38-1909000 (I.R.S. Employer Identification Number) One Madison Avenue, Cadillac, Michigan 49601 (Address of principal executive offices) ( Zip Code) (616) 779-2200 (Registrant's telephone number, including area code) 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 requirement 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, number of shares outstanding as of October 11, 1995: 5,579,260 KYSOR INDUSTRIAL CORPORATION Part I - FINANCIAL INFORMATION Item 1. Financial Statements The interim financial data presented herein is unaudited but, in the opinion of the management, reflects all adjustments (none of which was other than a normal recurring adjustment) necessary for a fair presentation of such information. Results for interim periods should not be considered indicative of results for a full year. There were no undisclosed material unusual charges or credits to income during the quarter ended September 30, 1995 nor was there a change in independent accountants during the period. Consolidated Statement of Income (Unaudited, amounts in thousands except per share data)
Quarter Ended Nine Months Ended September 30, September 30, 1995 1994 1995 1994 ___________ ___________ ____________ ____________ SALES AND REVENUES Net sales $ 90,019 $ 83,993 $ 274,819 $ 230,106 Interest and other revenues 976 548 2,066 1,270 ___________ ___________ ____________ ____________ TOTAL SALES AND REVENUES 90,995 84,541 276,885 231,376 ___________ ___________ ____________ ____________ COSTS AND EXPENSES Cost of sales 69,108 64,381 211,055 177,529 Selling and administrative expenses 13,553 11,908 41,751 35,351 Interest expense 398 459 1,320 1,499 Other expenses 307 230 898 836 ___________ ___________ ____________ ____________ TOTAL COSTS AND EXPENSES 83,366 76,978 255,024 215,215 ___________ ___________ ____________ ____________ INCOME BEFORE INCOME TAXES 7,629 7,563 21,861 16,161 INCOME TAXES 2,995 3,230 9,285 6,730 ___________ ___________ ____________ ____________ NET INCOME 4,634 4,333 12,576 9,431 DIVIDENDS ON PREFERRED STOCK (Net of income tax benefit) 243 244 730 734 ___________ ___________ ____________ ____________ EARNINGS APPLICABLE TO COMMON STOCK $ 4,391 $ 4,089 $ 11,846 $ 8,697 ___________ ___________ ____________ ____________ ___________ ___________ ____________ ____________ PRIMARY EARNINGS PER COMMON SHARE $ 0.75 $ 0.70 $ 2.01 $ 1.51 ___________ ___________ ____________ ____________ ___________ ___________ ____________ ____________ FULLY DILUTED EARNINGS PER COMMON SHARE $ 0.66 $ 0.60 $ 1.76 $ 1.29 ___________ ___________ ____________ ____________ ___________ ___________ ____________ ____________ Primary weighted average common shares and equivalents 5,835 5,818 5,900 5,758 ___________ ___________ ____________ ____________ ___________ ___________ ____________ ____________ Dividends declared per common share $ 0.15 $ 0.13 $ 0.45 $ 0.38 ___________ ___________ ____________ ____________ ___________ ___________ ____________ ____________ The accompanying notes are an integral part of the financial statements.
KYSOR INDUSTRIAL CORPORATION AND SUBSIDIARIES Consolidated Balance Sheet (Unaudited, dollars in thousands)
September 30, December 31, 1995 1994 ____________ ____________ CURRENT ASSETS Cash and equivalents $17,874 $15,850 Accounts receivable less $2,320 and $2,027 allowance for doubtful accounts 56,976 46,437 Finished goods inventory 8,605 6,362 Work-in-process inventory 10,729 10,039 Raw Material Inventory 18,098 19,864 Prepaid expenses 2,783 2,067 Deferred income tax charges 7,054 7,202 ____________ ____________ TOTAL CURRENT ASSETS 122,119 107,821 ____________ ____________ PROPERTY, PLANT AND EQUIPMENT Land 3,313 2,612 Buildings 33,892 31,103 Machinery and equipment 75,065 67,518 ____________ ____________ 112,270 101,233 Less accumulated depreciation 65,803 58,320 ____________ ____________ TOTAL PROPERTY, PLANT AND EQUIPMENT 46,467 42,913 ____________ ____________ OTHER ASSETS Goodwill, patents and other intangibles (net of amortization of $2,990 and $2,592) 4,218 4,616 Cash value of officers' life insurance 11,568 10,623 Deferred income tax charges 6,576 5,383 Miscellaneous receivables and other assets 5,633 6,155 ____________ ____________ TOTAL OTHER ASSETS 27,995 26,777 ____________ ____________ TOTAL ASSETS $196,581 $177,511 ____________ ____________ ____________ ____________ The accompanying notes are an integral part of the financial statements.
KYSOR INDUSTRIAL CORPORATION AND SUBSIDIARIES Consolidated Balance Sheet (continued) (Unaudited, dollars in thousands)
September 30, December 31, 1995 1994 ____________ ____________ CURRENT LIABILITIES Current maturities of long-term debt $10,987 $6,597 Accounts payable 22,128 21,122 Accrued income taxes payable 5,867 1,095 Accrued expenses and contingent liabilities 30,474 27,831 ____________ ____________ TOTAL CURRENT LIABILITIES 69,456 56,645 Long-term debt, less current maturities, plus guarantee of ESOP indebtedness 26,538 30,394 Accumulated postretirement benefit obligation 13,531 13,037 Other long-term liabilities 10,661 9,517 ____________ ____________ TOTAL LIABILITIES AND DEFERRED CREDITS 120,186 109,593 ____________ ____________ PREFERRED SHAREHOLDERS' EQUITY Employee Stock Ownership Plan Preferred Stock, shares authorized 5,000,000; outstanding 798,778 and 803,553 stated value of $24.375 19,470 19,587 Unearned deferred compensation under employee stock ownership plan (14,662) (15,311) ____________ ____________ TOTAL PREFERRED SHAREHOLDERS' EQUITY 4,808 4,276 ____________ ____________ COMMON SHAREHOLDERS' EQUITY Common stock, $1 par value, shares authorized 30,000,000, outstanding 5,570,038 and 5,640,881 5,570 5,641 Additional paid-in capital 3,067 5,386 Retained earnings 62,782 53,443 Translation adjustment 1,226 807 Notes receivable-common stock 78,122 and 96,705 shares (1,058) (1,286) Unearned deferred compensation under employee stock ownership plan - (349) ____________ ____________ TOTAL COMMON SHAREHOLDERS' EQUITY 71,587 63,642 ____________ ____________ TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $196,581 $177,511 ____________ ____________ ____________ ____________
KYSOR INDUSTRIAL CORPORATION CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited, amounts in thousands)
Nine Months Ended September 30, 1995 1994 CASH FLOWS PROVIDED (USED) BY OPERATING ACTIVITIES: Net income $12,576 $9,431 Adjustments to reconcile net income to net cash provided (used) by operating activities: Depreciation and amortization 6,777 6,821 Provision for losses on accounts receivable 362 392 (Gain) Loss on sales of fixed assets (53) (132) Deferred compensation (ESOP) 998 997 Deferred income taxes (1,045) (1,963) Changes in assets and liabilities providing (consuming) cash: Accounts receivable (10,901) (16,425) Inventories (1,167) (6,998) Prepaid expenses (716) (392) Accounts payable 1,298 7,176 Accrued expenses and contingent liabilities 2,642 4,355 Accrued income taxes payable 6,097 1,692 Other long-term liabilities 1,638 676 NET CASH PROVIDED BY OPERATING ACTIVITIES 18,506 5,630 CASH FLOWS PROVIDED (USED) BY INVESTING ACTIVITIES: Additions to property, plant and equipment (9,412) (5,524) Proceeds from sales of property, plant and equipment 72 185 Acquisitions, net of cash acquired - (4,128) Decrease (Increase) in other long-term assets (424) (1,035) Unrealized translation gain (loss) (120) 536 NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES (9,884) (9,966) CASH FLOWS PROVIDED (USED) BY FINANCING ACTIVITIES: Current borrowings 3,200 1,268 Principal payments against long-term debt (2,666) (2,521) Proceeds from issuance of common stock 2,620 1,399 Purchase of Common Stock (5,777) (234) Common stock and preferred stock dividends paid (3,975) (3,622) NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES (6,598) (3,710) NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS 2,024 (8,046) CASH AND EQUIVALENTS AT BEGINNING OF YEAR 15,850 21,339 CASH AND EQUIVALENTS AT END OF PERIOD $17,874 $13,293 The accompanying notes are an integral part of the financial statements.
Notes to the financial statements Note A - Basis of Presentation The accompanying unaudited consolidated condensed financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting solely of normal recurring accruals) considered necessary for fair presentation have been included. For further information, refer to the consolidated financial statements and footnotes included in the Company's annual report on Form 10-K for the fiscal year ended December 31, 1994. REPORT OF INDEPENDENT ACCOUNTANTS To the Board of Directors and Shareholders Kysor Industrial Corporation: We have reviewed the accompanying consolidated balance sheet of Kysor Industrial Corporation and Subsidiaries as of September 30, 1995, and the related consolidated statement of income for the three-month and nine-month periods ended September 30, 1995 and 1994 and the consolidated statement of cash flows for the nine-month periods ended September 30, 1995 and 1994. These financial statements are the responsibility of the company's management. We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements for them to be in conformity with generally accepted accounting principles. We have previously audited, in accordance with generally accepted auditing standards, the consolidated balance sheet of Kysor Industrial Corporation and Subsidiaries as of December 31, 1994 and the related consolidated statements of income, stockholders' equity and cash flows for the year then ended (none of which are presented herein); and in our report dated February 13, 1995 we expressed an unqualified opinion on those consolidated financial statements. By s/COOPERS & LYBRAND L.L.P. Coopers & Lybrand L.L.P. October 18, 1995 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations Kysor Industrial Corporation's sales and revenues for the third quarter 1995 increased to $91.0 million, from the $84.5 million reported for the same period in 1994. Net income for the third quarter of 1995 rose 7% to $4.6 million from $4.3 million reported for the same period last year. This equates to primary earnings per share of $.75 for the quarter ended September 30, 1995 compared to $.70 for the same period in 1994. The Transportation Products Group net sales were down 5% to $37.0 million for the third quarter of 1995 compared to the $39.0 million reported in the same period a year ago. Operating profit for the Transportation Products Group for the third quarter 1995 decreased 16% to $4.6 million from the $5.5 million reported for the same period in 1994. The Transportation Products Group backlog is beginning to reflect a downturn in incoming orders in the heavy-duty truck market, although truck manufacturers' current backlogs should be sufficient to provide increased overall production levels in 1995. The Commercial Products Group net sales increased 18% to $53.0 million for the third quarter of 1995 compared to $44.9 million reported for the same period a year ago. Operating profit for the Commercial Products Group for the third quarter of 1995 increased 24% to $6.3 million from the $5.0 million reported for the same period in 1994. In October 1995, the Company announced its decision to exit the commercial refrigeration operations located in Limburg, Germany by year end. It is anticipated that although costs to exit the German operations will be significant, the Company will obtain a U.S. tax benefit offsetting all of the anticipated exit costs. The Company is presently involved in certain environmental proceedings with respect to soil and groundwater contamination in Cadillac, Michigan, as described in Note 10, Contingent Liabilities, to the Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 1994 ("the Form 10-K"). In addition, as disclosed in Note 10 and under the heading "Legal Proceedings" in the Form 10-K and below, the Company is also involved in various other legal proceedings including certain proceedings involving allegedly contaminated sites to which the Company has been named a potentially responsible party ("PRP") under the Federal Superfund law or comparable state laws. Although discovery in certain of these proceedings has not been completed, subject to the contingencies discussed in Note 10, management does not believe, based on information presently available to it, that the ultimate aggregate cost to the Company of such proceedings would have a material adverse effect on its financial condition, results of operations, or liquidity. Liquidity and Capital Resources At September 30, 1995, the Company had cash and equivalents of $17.9 million compared to $15.9 million at December 31, 1994. Additions to property, plant and equipment for the nine-month period ended September 30, 1995, totaled $9.4 million compared to $5.5 million during the same period in 1994. Management believes working capital is sufficient for current requirements. At September 30, 1995, the Company had no outstanding borrowings on its $20.0 million revolving line of credit. KYSOR INDUSTRIAL CORPORATION FINANCIAL INFORMATION BY SEGMENT (Unaudited, amounts in thousands)
Quarter Ended Nine Months Ended September 30, September 30, _____________________ _____________________ 1995 1994 1995 1994 ________ ________ ________ ________ NET SALES Commercial Products United States $49,626 $40,844 $137,890 $106,990 Europe 3,368 4,104 13,082 11,288 ________ ________ ________ ________ Total Commercial Products 52,994 44,948 150,972 118,278 Transportation Products United States 33,725 36,677 113,496 105,487 Europe 3,300 2,368 10,351 6,341 ________ ________ ________ ________ Total Transportation Products 37,025 39,045 123,847 111,828 ________ ________ ________ ________ NET SALES $90,019 $83,993 $274,819 $230,106 ________ ________ ________ ________ ________ ________ ________ ________ OPERATING PROFIT Commercial Products United States $6,961 $5,001 $17,846 $10,653 Europe (700) 32 (2,745) (941) ________ ________ ________ ________ Total Commercial Products 6,261 5,033 15,101 9,712 Transportation Products United States 4,281 5,405 16,023 15,174 Europe 276 45 680 14 ________ ________ ________ ________ Total Transportation Products 4,557 5,450 16,703 15,188 ________ ________ ________ ________ TOTAL OPERATING PROFIT 10,818 10,483 31,804 24,900 Corporate Administrative Expense (Net) (2,791) (2,461) (8,623) (7,240) Interest Expense (398) (459) (1,320) (1,499) ________ ________ ________ ________ INCOME BEFORE INCOME TAXES $7,629 $7,563 $21,861 $16,161 ________ ________ ________ ________ ________ ________ ________ ________
PART II. OTHER INFORMATION Item 1. Legal Proceedings The Company is presently involved in various legal proceedings, including certain environmental proceedings, as described in Note 10, Contingent Liabilities, to the Financial Statements included in the Form 10-K and under the heading "Legal Proceedings" in the Form 10-K. Except as described in the Company's quarterly report on Form 10-Q for the quarter ended March 31, 1995, there have been no material changes in the legal proceedings described in the Form 10-K. Item 6. EXHIBITS AND REPORTS ON FORM 8-K (a) The following exhibits are filed as part of this report. 11 Statement Regarding Computation of Earnings Per Share 15 Letter from Coopers & Lybrand regarding unaudited Financial Statements 27 Financial Data Schedule (b) There were no reports on Form 8-K filed by the registrant during the quarter ended September 30, 1995. 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. KYSOR INDUSTRIAL CORPORATION Date: November 3, 1995 By s\Terry M. Murphy Terry M. Murphy Vice President, Chief Financial Officer (principal financial officer and duly authorized signatory for registrant) Date: November 3, 1995 By s\Robert L. Joseph Robert L. Joseph Comptroller (Chief Accounting Officer) EXHIBIT INDEX DESCRIPTION EXHIBIT NO. Statement Regarding Computation of Earnings Per Share 11 Letter from Coopers & Lybrand Regarding Unaudited Financial Statements 15 Financial Data Schedule 27 EX-11 2 EXHIBIT 11 - S-K Item 601 (b) (11) KYSOR INDUSTRIAL CORPORATION AND SUBSIDIARIES COMPUTATION OF CONSOLIDATED EARNINGS PER SHARE
Nine Months Ended September 30, 1995 1994 ---- ---- PRIMARY EARNINGS PER SHARE CALCULATION Net Income $12,575,876 $9,430,612 Less dividends on preferred stock 1,175,471 1,181,143 Plus tax benefit from preferred dividends 446,000 448,000 ---------- ---------- Earnings (Loss) applicable to common stock 11,846,405 8,697,469 ========== ========== Weighted average common shares outstanding 5,521,999 5,440,592 Dilutive effect assuming excercise of certain stock options applying the treasury stock method based on year to date average price 377,597 317,737 -------- -------- Weighted average common shares and common equivalent shares outstanding 5,899,596 5,758,329 ========= ========= Primary earnings per share $2.01 $1.51 ======== ======== FULLY DILUTED EARNINGS PER SHARE CALCULATION A. Weighted average common shares outstanding 5,521,999 5,440,592 Dilutive effect assuming excercise of certain stock options applying the treasury stock method based on the greater of year to date average or end of period price 383,199 406,129 -------- -------- Weighted average common shares and common equivalent shares outstanding 5,905,198 5,846,721 ======== ======== Fully diluted earnings per share (A) $2.01 $1.49 ======== ======== B. Assuming preferred stock converted to common Vested Preferred shares issued 199,344 168,388 Non-vested Preferred shares issued 599,434 636,990 ---------- ---------- Total Preferred shares issued 798,778 805,378 Vested Preferred shares issued 199,344 168,388 Guaranteed floor price for involuntary conversions $24.375 $24.375 ---------- ---------- Subtotal $4,859,003 $4,104,465 The lower of year to date average or end of period common stock price $21.5645 $17.5510 -------- -------- Required common shares to be issued assuming involuntary conversion of vested shares at guaranteed floor price 225,324 233,859 Required common shares to be issued assuming voluntary conversion of non-vested shares on one-for-one basis 599,434 636,990 Weighted average common shares and common equivalent shares outstanding for fully diluted Part A. 5,905,198 5,846,721 ---------- ---------- Weighted average common shares and common equivalent shares outstanding for fully diluted Part B. 6,729,956 6,717,570 ========== ========== Net Income $12,575,876 $9,430,612 Additional ESOP expense presently funded by preferred dividend (1,175,471) (1,181,143) Plus tax benefit on additional ESOP expense 70,376 60,424 Common stock dividends to reduce ESOP expense 371,000 331,000 -------- -------- Adjusted Net Income $11,841,781 $8,640,893 ========= ========= Fully diluted earnings per share (B) $1.76 $1.29 ======== ======== Fully diluted earnings (loss) per share (Lower of (A) or (B)) $1.76 $1.29 ======== ========
EX-15 3 To the Board of Directors and Shareholders Kysor Industrial Corporation Re: Kysor Industrial Corporation Registration Statement Nos. 2-67607, 2-86346, 2-99855, 33-18438, 33-30463, 33-27360, 33-59412 and 33-71758 on Form S-8 We are aware that our report dated October 18, 1995 on our review of interim financial information of Kysor Industrial Corporation and Subsidiaries for the periods ended September 30, 1995 and 1994 and included in the Company's quarterly report on Form 10-Q for the quarters then ended are incorporated by reference in these registration statements. Pursuant to Rule 436(c) under the Securities Act of 1933, this report should not be considered a part of the registration statements prepared or certified by us within the meaning of Sections 7 and 11 of that Act. By s/COOPERS & LYBRAND L.L.P. Coopers & Lybrand L.L.P. October 18, 1995 EX-27 4 ART. 5 FDS FOR 3RD QTR 10-Q
5 This Schedule contains summary financial information extracted from the unaudited consolidated condensed financial statements of Kysor Industrial Corporation and Subsidiaries for the quarter and nine months ended September 30, 1995 and is qualified in its entirety by reference to such financial statements. 1,000 US DOLLARS 9-MOS DEC-31-1995 SEP-30-1995 1 17,874 0 59,296 2,320 37,432 122,119 112,270 65,803 196,581 69,456 26,538 5,570 0 19,470 51,355 196,581 274,819 276,885 211,055 252,806 898 362 1,320 21,861 9,285 12,576 0 0 0 12,576 2.01 1.76
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