-----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, Q7XYBaNGH9SgFHl9mJ55QEqkyesL7cmm0arnxCmQU6BY7K/tC3Ci6a5gmyqxHrfi dNeqZPqpMEjcU/lUOQme1g== 0000215419-03-000004.txt : 20030423 0000215419-03-000004.hdr.sgml : 20030423 20030423172631 ACCESSION NUMBER: 0000215419-03-000004 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030330 ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20030423 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHECKPOINT SYSTEMS INC CENTRAL INDEX KEY: 0000215419 STANDARD INDUSTRIAL CLASSIFICATION: COMMUNICATIONS EQUIPMENT, NEC [3669] IRS NUMBER: 221895850 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-11257 FILM NUMBER: 03660758 BUSINESS ADDRESS: STREET 1: 101 WOLF DR STREET 2: P O 188 CITY: THOROFARE STATE: NJ ZIP: 08086 BUSINESS PHONE: 856-384-2460 MAIL ADDRESS: STREET 1: 101 WOLF DRIVE CITY: THOROFARE, STATE: NJ ZIP: 08086 8-K 1 april038k.txt FORM 8-K PRESS RELEASE SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM 8-K AMENDMENT TO CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): April 22, 2003 Checkpoint Systems, Inc. -------------------------------------------------------------- (Exact name of registrant as specified in its charter) Pennsylvania ------------------------------------------------------------ (State or other jurisdiction of incorporation or organization) 1-11257 22-1895850 ------------------------ -------------------------------- (Commission File Number) (I.R.S. Employer Identification No.) 101 Wolf Drive, P.O. Box 188, Thorofare, New Jersey 08086 ------------------------------------------------------------------- (Address of principal executive offices) (856) 848-1800 ----------------------------------------------------------------- (Registrant's telephone number, including area code) N/A ------------------------------------------------------------------ (Former name or address, if changed since last report) Item 7. Financial Statements and Exhibits (c) Press release dated April 22, 2003 announcing the Company's financial results for the first quarter of 2003. Item 9. Regulation FD Disclosure; and Item 12. Results of Operations and Financial Condition On April 22, 2003, the Registrant issued a press release announcing its financial results for the first quarter of 2003. A copy of the press release is furnished as Exhibit 99.1 to this report and is incorporated by reference. Signature --------- Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Date: April 23, 2003 Checkpoint Systems, Inc. /s/George W. Off - ------------------------ George W. Off Chairman and Chief Executive Officer EXHIBIT INDEX ------------- EXHIBIT NO. DESCRIPTION OF EXHIBITS - ------------ ------------------------- 99.1 Press release dated April 22, 2003. EX-99.1 3 press.txt PRESS RELEASE COMPANY CONTACT: Checkpoint Systems, Inc. Craig Burns Executive Vice President, Chief Financial Officer, Finance and Operations (856) 848-1800 INVESTOR RELATIONS CONTACTS: Christine Mohrmann, Lindsay Hatton FD Morgen-Walke (212) 850-5600 PRESS CONTACT: Jason Rando FOR IMMEDIATE RELEASE FD Morgen-Walke - --------------------- (212) 850-5600 Checkpoint SYSTEMS, INC. announces 2003 FIRST Quarter Results Thorofare, New Jersey, April 22, 2003 - Checkpoint Systems, Inc. (NYSE: CKP) today reported financial results for the first quarter ended March 30, 2003. The Company's first quarter 2003 net earnings were $4.2 million, or $0.13 per diluted share, compared to a net loss of $68.7 million, or $1.73 per diluted share, in the first quarter 2002. Included in the net loss for the first quarter 2002 is a goodwill impairment charge of $72.9 million, which reflected the cumulative effect of the change in accounting principle from the Company's adoption of Statement of Financial Accounting Standards No. 142 (SFAS 142) "Goodwill and Other Intangible Assets." The first quarter 2002 earnings before cumulative effect of change in accounting principle was $4.1 million, or $0.13 per diluted share. Revenues for the first quarter 2003 were $156.4 million versus $143.5 million for the first quarter 2002. Foreign exchange had a positive impact on revenues of approximately $15.2 million in the first quarter of 2003 as compared to the first quarter of 2002. "Our results for the first quarter reflect the strength of our business model in the face of continued economic difficulties," commented George Off, Chairman and Chief Executive Officer of Checkpoint. "Our security segment performed well in Europe and Asia Pacific, partially offsetting the anticipated decline in the European retail merchandising segment. The security segment in the U.S. performed well, primarily due to increased closed-circuit television (CCTV) activity, which offset a decline in electronic article surveillance (EAS) sales." Gross profit for the first quarter 2003 was $63.1 million, or 40.4% of revenues, compared to $59.4 million, or 41.4% of revenues, for the first quarter 2002. Selling, general, and administrative expenses (SG&A) were $54.9 million, or 35.1% of revenues, for the first quarter 2003, compared to $49.8 million, or 34.7% of revenues, in the same period last year. Operating income was $8.3 million in the first quarter 2003, or 5.3% of revenues, compared to operating income of $9.6 million, or 6.7% of revenues, in the first quarter 2002. Cash flow from operations for the first quarter 2003 was $2.7 million versus $8.9 million in the first quarter 2002. As of March 30, 2003, cash and cash equivalents were $35.8 million, working capital was $101.0 million and total debt was $194.0 million. Capital expenditures in the first quarter were $5.8 million, compared to $1.3 million a year ago. Craig Burns, Executive Vice President, Chief Financial Officer, Finance and Operations, commented, "During the first quarter, we paid down a net amount of $17.5 million in debt, which puts us on target for our full-year 2003 debt repayment goal of between $50 million and $60 million. Our balance sheet remains strong and we remain confident in the underlying fundamentals of the business." Mr. Off stated, "During the first quarter of 2003, Checkpoint announced several exciting new developments. We successfully launched our new Liberty(TM) antenna platform and have already installed over 1,200 new antennas this year. Also during the quarter, Bill Antle joined our Board of Directors. As the former Chairman, President, and Chief Executive Officer of Oak Industries, Inc., a manufacturer of leading-edge communications components, his experience in managing a technology growth company will be an invaluable contribution to the Checkpoint team." Mr. Off continued, "On the litigation front, the federal judge in the ID Security Systems Canada Inc. litigation vacated the anti-trust verdict against Checkpoint and reduced the damages on the tortious interference and unfair competition claim. We are still assessing our appeal strategy on the remaining award." Mr. Off concluded, "Looking forward, the uncertainty in the economy and the fluctuations in currency exchange rates make our results difficult to predict. However, we believe that we are on track for our previously disclosed guidance for 2003, which anticipates earnings growth of between 5% and 10%, with 2003 revenues comparable to 2002. While we cannot foresee an end to the current economic downturn, we are confident that our plan to lower interest expense and management costs, while expanding investments in research and development, and sales and marketing, will help us maximize our Company's potential while effectively containing costs." Checkpoint Systems will host a conference call today, April 22, 2003, at 10:00 a.m. Eastern Time, to discuss its 2003 first quarter results. The conference call will be simultaneously broadcast live over the Internet. Listeners may access the live webcast at the Company's homepage, www.checkpointsystems.com, by clicking on the "Conference Calls" link or entering the "Investors" section of this site. Please allow 15 minutes prior to the call to visit the site and download and install any necessary audio software. The webcast will be archived at the Company's homepage beginning approximately 90 minutes after the call ends until the next quarterly conference call. Checkpoint Systems, Inc. is a multinational company that manufactures and markets labeling systems designed to improve efficiency, reduce costs and provide value-added label solutions for customers across many markets and industries. Checkpoint is a leading provider of EAS and RFID systems, source tagging, barcode labeling systems, hand-held labeling systems and retail merchandising systems. Applications include automatic identification, retail security and pricing and promotional labels. Operating directly in 30 countries, Checkpoint has a global network of subsidiaries and provides professional customer service and technical support around the world. Checkpoint Systems, Inc.'s web site is located at www.checkpointsystems.com. Safe Harbor Statement This press release may include information that could constitute forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements may involve risk and uncertainties that could cause actual results to differ materially from any future results encompassed within the forward-looking statements. Factors that could cause or contribute to such differences include those matters disclosed in the Company's Security and Exchange Commission filings. (Two Tables Follow) Checkpoint Systems, Inc. Consolidated Statements of Operations (Thousands except per share amounts) (unaudited) Quarter Ended (13 weeks) March 30, March 31, 2003 2002 ---- ---- Net revenues $156,417 $143,454 Cost of revenues 93,268 84,022 ------- ------ Gross profit 63,149 59,432 Selling, general, and administrative expenses 54,897 49,832 ------ ------- Operating income 8,252 9,600 Interest income 339 415 Interest expense 3,043 3,725 Other gain/(loss), net 748 (231) ------ ------ Earnings before income taxes 6,296 6,059 Income taxes 2,078 1,939 Minority interest 17 6 ----- ------ Earnings before cumulative effect of change in accounting principle 4,201 4,114 Cumulative effect of change in accounting principle - (72,861) ----- -------- Net earnings/(loss) $ 4,201 $(68,747) ======== ========= Earnings per share before cumulative effect of change in accounting principle: Basic $ 0.13 $ 0.13 Diluted $ 0.13 $ 0.13 Net earnings/(loss) per share: Basic $ 0.13 $ (2.15) Diluted $ 0.13 $ (1.73) Weighted average common stock outstanding 32,723 31,944 Weighted average common stock and dilutive stock outstanding 32,814 32,679 (CONTINUED) Checkpoint Systems, Inc. Summary Consolidated Balance Sheet (Thousands) March 30, December 29, 2003 2002 ---- ----- (unaudited) preliminary Cash and Cash Equivalents $ 35,834 $ 54,670 Working Capital $101,039 $111,187 Current Assets $281,596 $297,866 Total Debt $194,020 $209,325 Shareholders' Equity $234,517 $225,246 Total Assets $670,855 $678,382 # # # -----END PRIVACY-ENHANCED MESSAGE-----