-----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, H0X5KxKNeeuYrPSzYd6GjjzpVG2CHkE973L89H0McUZukMpm/7gQBn5+bPfAQ16K yQtsV1/7LEldSAFIDlGKzw== 0000893220-96-001826.txt : 19961113 0000893220-96-001826.hdr.sgml : 19961113 ACCESSION NUMBER: 0000893220-96-001826 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960929 FILED AS OF DATE: 19961112 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: TELEFLEX INC CENTRAL INDEX KEY: 0000096943 STANDARD INDUSTRIAL CLASSIFICATION: SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841] IRS NUMBER: 231147939 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-05353 FILM NUMBER: 96659640 BUSINESS ADDRESS: STREET 1: 630 W GERMANTOWN PK STE 450 STREET 2: SUITE 450 CITY: PLYMOUTH MEETING STATE: PA ZIP: 19462 BUSINESS PHONE: 2158346301 MAIL ADDRESS: STREET 1: 630 WEST GERMANTOWN PIKE STREET 2: SUITE 450 CITY: PLYMOUTH MEETING STATE: PA ZIP: 19462 10-Q 1 FORM 10-Q, TELEFLEX INCORPORATED 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 29, 1996 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 1-5353 TELEFLEX INCORPORATED ----------------------------------------------------- (Exact Name of Registrant as Specified in its Charter) Delaware 23-1147939 - ----------------------- ----------------------------------- (State of Incorporation) (IRS Employer Identification Number) 630 West Germantown Pike, Suite 450 Plymouth Meeting, PA 19462 - -------------------------------------- ---------- (Address of Principal Executive Office) (Zip Code) (610) 834-6301 ------------------------------------- (Telephone Number Including Area Code) None ---------------------------------------------------- (Former Name, Former Address and Former Fiscal Year, If Changed Since Last Report) 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. Class Outstanding at September 29, 1996 - ----------------------------- --------------------------------- Common Stock, $1.00 Par Value 17,672,416 2 Teleflex Incorporated Condensed Consolidated Balance Sheet (Dollars in Thousands)
Assets Sept. 29, Dec. 31, 1996 1995 --------- -------- Current assets Cash and cash equivalents $115,004 $ 55,654 Accounts receivable less allowance for doubtful accounts 182,773 186,077 Inventories Raw materials 68,917 74,281 Work-in-process 31,096 40,694 Finished goods 84,907 77,547 Prepaid expenses 8,318 11,553 -------- -------- 491,015 445,806 Property, plant and equipment, at cost, less accumulated depreciation 260,815 271,786 Investments in affiliates 14,612 13,557 Intangibles and other assets 57,095 54,022 -------- -------- $823,537 $785,171 ======== ======== Liabilities and shareholders' equity Current liabilities Current portion of borrowings and demand loans $ 72,035 $ 74,218 Accounts payable and accrued expenses 97,741 101,405 Estimated income taxes payable 16,970 17,532 -------- -------- 186,746 193,155 Long-term borrowings 192,811 196,844 Deferred income taxes and other 53,274 39,808 -------- -------- 432,831 429,807 Shareholders' equity 390,706 355,364 -------- -------- $823,537 $785,171 ======== ========
3 Teleflex Incorporated Condensed Consolidated Statement of Income (Dollars in Thousands Except Per Share)
Three Months Ended Nine Months Ended ------------------------ ------------------------ Sept. 29, Sept. 24, Sept. 29, Sept. 24, 1996 1995 1996 1995 -------- -------- -------- -------- Revenues $215,144 $210,340 $687,986 $671,121 -------- -------- -------- -------- Cost of sales 148,773 145,876 473,173 460,659 Operating expenses 47,597 47,076 142,558 143,978 Interest expense 3,361 4,692 10,845 14,347 -------- -------- -------- -------- 199,731 197,644 626,576 618,984 -------- -------- -------- -------- Income before taxes 15,413 12,696 61,410 52,137 Provision for taxes on income 5,364 4,444 21,372 18,248 -------- -------- -------- -------- Net income $ 10,049 $ 8,252 $ 40,038 $ 33,889 ======== ======== ======== ======== Earnings per share $ 0.56 $ 0.46 $ 2.23 $ 1.91 Dividends per share $ 0.175 $ 0.155 $ 0.505 $ 0.445 Average number of common and common equivalent shares outstanding 18,026 17,829 17,974 17,758
4 Teleflex Incorporated Condensed Consolidated Statement of Cash Flows (Dollars in Thousands)
Nine Months Ended ------------------------- Sept. 29, Sept. 24, 1996 1995 -------- --------- Cash flows from operating activities: Net income $ 40,038 $ 33,889 Adjustments to reconcile net income to cash flows from operating activities: Depreciation and amortization 28,900 27,049 (Increase) decrease in accounts receivable (3,391) 4,946 (Increase) in inventories (8,063) (15,947) Decrease in prepaid expenses 2,537 4,213 (Decrease) in accounts payable and accrued expenses (2,602) (9,360) (Decrease) increase in estimated income taxes payable (340) 7,873 Gain on sale of businesses and assets (2,055) -------- -------- 55,024 52,663 -------- -------- Cash flows from financing activities: Proceeds from new borrowings 20,030 3,580 Reduction in long-term borrowings (18,817) (15,553) (Decrease) increase in current borrowings and demand loans (512) 11,706 Proceeds from stock compensation plans and distribution of treasury shares 4,167 4,961 Dividends (8,891) (7,742) -------- -------- (4,023) (3,048) -------- -------- Cash flows from investing activities: Expenditures for plant assets 24,134 20,648 Payments for businesses acquired 8,176 Proceeds from sale of businesses and assets (32,140) Investments in affiliates 444 690 Other, including translation (787) 993 -------- -------- (8,349) 30,507 -------- -------- Net increase in cash and cash equivalents 59,350 19,108 Cash and cash equivalents at the beginning of the period 55,654 24,094 -------- -------- Cash and cash equivalents at the end of the period $115,004 $ 43,202 ======== ========
5 Teleflex Incorporated Notes to Condensed Consolidated Financial Statements Note 1 The accompanying unaudited condensed consolidated financial statements for the three months ended September 29, 1996 and September 24, 1995 contain all adjustments, consisting only of normal recurring adjustments, which in the opinion of management are necessary to present fairly the financial position, results of operations and cash flows for the periods then ended in accordance with the current requirements for Form 10-Q. Note 2 At September 29, 1996, 1,905,947 shares of common stock were reserved for issuance under the company's stock compensation plans. Note 3 Business segment information:
Three months ended (000) Sept. 29, 1996 Sept. 24, 1995 Sales Commercial Products $ 93,110 $ 87,701 Medical Products 75,524 72,612 Aerospace Products and Services 46,510 50,027 -------- -------- Total $215,144 $210,340 ======== ======== Operating profit Commercial Products $ 9,855 $ 10,864 Medical Products 7,811 6,410 Aerospace Products and Services 4,380 2,686 -------- -------- Total $ 22,046 $ 19,960 ======== ======== Nine months ended (000) Sept. 29, 1996 Sept. 24, 1995 Sales Commercial Products $317,742 $299,158 Medical Products 229,095 217,182 Aerospace Products and Services 141,149 154,781 -------- -------- Total $687,986 $671,121 ======== ======== Operating profit Commercial Products $ 41,950 $ 44,815 Medical Products 25,533 21,916 Aerospace Products and Services 14,243 7,116 -------- -------- Total $ 81,726 $ 73,847 ======== ========
6 Management's Analysis of Quarterly Financial Data Sale of Product Lines: During the first quarter of 1996, the company sold two product lines in the Aerospace Segment for $37.5 million ($32 million in cash and $5.5 million in notes receivable) resulting in a $2 million pre-tax gain or, $.07 per share. The gain has been reported as a reduction in operating expenses in the Statement of Income and is included in the Aerospace Segment operating profit. The product lines had combined sales and operating profit in the third quarter of 1995 of $13 million and $800,000, respectively. Results of Operations: Revenues increased 2% in the third quarter of 1996 to $215.1 million from $210.3 million in 1995. The increase resulted from gains in the Commercial and Medical segments which offset a decline in the Aerospace Segment. The increase was the result of internal growth in the company's core businesses, offset partially by the decline from the sale of two Aerospace product lines in the first quarter of 1996. The increase in sales excluding the 1995 results of the product lines sold was approximately 9%. The Commercial, Medical and Aerospace segments comprised 43%, 35% and 22% of the company's net sales, respectively. Gross profit margin increased slightly to 30.8% in 1996 compared with 30.6% in 1995. An increase in the gross profit margin in the Medical and Aerospace segments was offset by a decline in the Commercial Segment. Operating expenses as a percentage of sales declined to 22.1% in 1996 from 22.4% in 1995 as an increase in the Aerospace Segment was more than offset by declines in the Medical and Commercial segments. Operating profit increased 10% in the third quarter of 1996 from $20.0 million to $22.0 million and operating margin increased from 9.5% of sales to 10.2%. Operating profit and operating margin increases in the Aerospace and Medical segments offset declines in the Commercial Segment. Industry Segment Review: Sales in the Commercial Segment increased 6% from $87.7 million in 1995 to $93.1 million in 1996. The increase resulted from a gain in the Automotive product line while the Marine and Industrial product lines were essentially flat. Within the Marine product line, a decline in sales of electronic products was offset by an increase in sales of marine controls. Operating profit in 1996 of $9.9 million represents a 9% decrease compared 7 with 1995 and operating margin declined from 12.4% to 10.6% due to decreases in the marine and industrial product lines. Medical Segment sales increased 4% from $72.6 million to $75.5 million in the third quarter of 1996 compared with 1995. Both the hospital supply and surgical instruments product lines achieved higher volume despite exchange rate decreases. Operating profit increased 22% from $6.4 million in 1995 to $7.8 million in 1996 and operating margin improved from 8.8% to 10.3% as a result of improvements in the surgical instruments product line. Operating profit in the third quarter of 1995 included a $1.2 million pre-tax charge for severance. The Aerospace Segment sales declined 7% from $50.0 million in 1995 to $46.5 million in 1996. The decline resulted from the sale of two product lines in the first quarter of 1996 which had combined revenues and operating profit of approximately $13 million and $800,000, respectively, in the third quarter of 1995. Excluding the dispositions, sales increased over 25% from growth in core Aerospace product lines, primarily the Sermatech coatings, repairs and blade manufacturing businesses. Operating profit increased 63% from $2.7 million in 1995 to $4.4 million in 1996 and operating margin increased from 5.4% to 9.4% of sales. The gains were the result of higher volume in the Sermatech and aerospace controls product lines. Cash flow from operations increased $2.4 million during the period ended September 29, 1996 compared with 1995 due to higher net income and improvements in working capital levels, offset by the timing of income tax payments. The increase in the cash balance reflects the $32 million cash proceeds from the sale of two Aerospace product lines. Working capital increased from $252.7 million at December 31, 1995, to $304.3 million at September 29, 1996. The ratio of current assets to current liabilities was 2.6 to 1 at September 29, 1996 compared with 2.3 to 1 at December 31, 1995. Long-term borrowings decreased by $4.0 million from $196.8 million at December 31, 1995, to $192.8 million at September 29, 1996. The decline was due to the effects of lower foreign currency translation rates which offset an increase in net borrowings. The combination of the decline in long-term borrowings and the increase in shareholders' equity resulted in an improvement in the ratio of long-term borrowings to total capitalization from 36% at December 31, 1995 to 33% at September 29, 1996. 8 Teleflex Incorporated Part II Other Information Item 6. Exhibits and Reports on Form 8-K (A) Reports on form 8-K. No reports on form 8-K were filed during the quarter. 9 Teleflex Incorporated 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. TELEFLEX INCORPORATED /s/ Harold L. Zuber, Jr. -------------------------- Harold L. Zuber, Jr. (Principal Financial and Accounting Officer) /s/ Steven K. Chance -------------------------- Steven K. Chance (Vice President) November 7, 1996 EX-27 2 FINANCIAL DATA SCHEDULE
5 1,000 9-MOS DEC-29-1996 JAN-01-1996 SEP-29-1996 115,004 0 182,773 0 184,920 491,015 260,815 0 823,537 186,746 192,811 0 0 17,672 373,034 823,537 215,144 215,144 148,773 148,773 47,597 0 3,361 15,413 5,364 10,049 0 0 0 10,049 .56 .56
-----END PRIVACY-ENHANCED MESSAGE-----