<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 1-12619
RALCORP HOLDINGS, INC.
SAVINGS INVESTMENT PLAN
RALCORP HOLDINGS, INC.
SUITE 2900
800 MARKET STREET
ST. LOUIS, MISSOURI 63101
<PAGE> 2
RALCORP HOLDINGS, INC.
SAVINGS INVESTMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
(in thousands)
<TABLE>
<CAPTION>
December 31, 1997
---------------------
Participant Directed
---------------------
U.S. Growth
Ralcorp Fixed Equity Government and
Stock Income Index Money Income Balanced
Fund Fund Fund Market Fund Fund
------------ ------- ------- ----------- ------- ---------
<S> <C> <C> <C> <C> <C> <C>
Assets
Investments:
Shares in registered investment
companies $ - $ 4,938 $17,981 $ 8,026 $15,171 $ 12,162
Common stock
Ralcorp Stock 28,029
General Mills Stock
Insurance company contracts 312
Notes receivable from participants
Total investments 28,029 5,250 17,981 8,026 15,171 12,162
------------ ------- ------- ----------- ------- ---------
Contributions receivable
Interest and dividends receivable
Total Assets 28,029 5,250 17,981 8,026 15,171 12,162
------------ ------- ------- ----------- ------- ---------
Liabilities
Fees payable 4
------------
Total Liabilities 4 - - - - -
------------ ------- ------- ----------- ------- ---------
Net Assets Available for Benefits $ 28,025 $ 5,250 $17,981 $ 8,026 $15,171 $ 12,162
============ ======= ======= =========== ======= =========
See accompanying notes to financial statements.
Inter- Parti-
Aggressive national Bond General cipant
Growth Growth Index Mills Loan
Fund Fund Fund Fund Fund Total
----------- --------- ------ -------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Assets
Investments:
Shares in registered investment
companies $ 4,669 $ 4,496 $ 554 $ 67,997
Common stock
Ralcorp Stock 28,029
General Mills Stock $ 6,547 6,547
Insurance company contracts 312
Notes receivable from participants $ 5,371 5,371
------- --------
Total investments 4,669 4,496 554 6,547 5,371 108,256
----------- --------- ------ -------- ------- --------
Contributions receivable -
Interest and dividends receivable -
--------
Total Assets 4,669 4,496 554 6,547 5,371 108,256
----------- --------- ------ -------- ------- --------
Liabilities
Fees payable 4
--------
Total Liabilities - - - - - 4
----------- --------- ------ -------- ------- --------
Net Assets Available for Benefits $ 4,669 $ 4,496 $ 554 $ 6,547 $ 5,371 $108,252
=========== ========= ====== ======== ======= ========
<FN>
See accompanying notes to financial statements.
</TABLE>
<PAGE> 3
<TABLE>
<CAPTION>
RALCORP HOLDINGS, INC.
SAVINGS INVESTMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
(in thousands)
December 31, 1996
---------------------
Participant Directed
---------------------
U.S. Growth
Ralcorp Fixed Equity Government and Aggressive
Stock Income Index Money Income Balanced Growth
Fund Fund Fund Market Fund Fund Fund
----------- ------- ------- ----------- ------- --------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets
Investments:
Shares in registered investment
companies $ 473 $ 6,118 $12,613 $ 7,167 $ 9,730 $ 9,553 $ 4,386
Common stock
Ralcorp Stock 37,942
Insurance company contracts 729
Notes receivable from participants
Total investments 38,415 6,847 12,613 7,167 9,730 9,553 4,386
----------- ------- ------- ----------- ------- --------- -----------
Contributions receivable 1 1 1 2 1
Interest and dividends receivable 1
-----------
Total Assets 38,416 6,847 12,614 7,168 9,731 9,555 4,387
----------- ------- ------- ----------- ------- --------- -----------
Liabilities
Fees payable 5
-----------
Total Liabilities 5 - - - - - -
----------- ------- ------- ----------- ------- --------- -----------
Net Assets Available for Benefits $ 38,411 $ 6,847 $12,614 $ 7,168 $ 9,731 $ 9,555 $ 4,387
=========== ======= ======= =========== ======= ========= ===========
Inter- Parti-
national cipant
Growth Loan
Fund Fund Total
--------- ------- --------
<S> <C> <C> <C>
Assets
Investments:
Shares in registered investment
companies $ 5,180 $ 55,220
Common stock
Ralcorp Stock 37,942
Insurance company contracts 729
Notes receivable from participants $ 6,454 6,454
------- --------
Total investments 5,180 6,454 100,345
--------- ------- --------
Contributions receivable 1 7
Interest and dividends receivable 1
--------
Total Assets 5,181 6,454 100,353
--------- ------- --------
Liabilities
Fees payable 5
--------
Total Liabilities - - 5
--------- ------- --------
Net Assets Available for Benefits $ 5,181 $ 6,454 $100,348
========= ======= ========
<FN>
See accompanying notes to financial statements.
</TABLE>
<PAGE>4
<TABLE>
<CAPTION>
RALCORP HOLDINGS, INC.
SAVINGS INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
(in thousands)
Year Ended December 31, 1997
------------------------------
Participant Directed
------------------------------
U.S. Growth
Ralcorp Fixed Equity Government and
Stock Income Index Money Income
Fund Fund Fund Market Fund
-------------------- -------- -------- ------------ --------
<S> <C> <C> <C> <C> <C>
Additions To Net Assets:
Contributions:
Participants $ 1,723 $ 135 $ 523 $ 744 $ 621
Employer 2,015
--------------------
3,738 135 523 744 621
-------------------- -------- -------- ------------ --------
Investment income:
Dividends and interest 99 331 372 376 1,351
Net appreciation (depreciation) in fair
value of investments 8,694 (5) 3,928 1,990
Other additions 9 9 17 (16) 15
-------------------- -------- -------- ------------ --------
8,802 335 4,317 360 3,356
-------------------- -------- -------- ------------ --------
Total Additions 12,540 470 4,840 1,104 3,977
-------------------- -------- -------- ------------ --------
Deductions From Net Assets:
Distribution to participants (2,715) (1,122) (1,785) (1,930) (1,419)
Administrative expenses (24) (1) (4) (4) (4)
-------------------- -------- -------- ------------ --------
(2,739) (1,123) (1,789) (1,934) (1,423)
-------------------- -------- -------- ------------ --------
Net Increase (Decrease) Prior to Transfers 9,801 (653) 3,051 (830) 2,554
Transfer to Ralston Resorts Savings
Investment Plan (844) (477) (1,247) (432) (1,452)
Interfund transfers (19,343) (467) 3,563 2,120 4,338
-------------------- -------- -------- ------------ --------
Net increase (decrease) (10,386) (1,597) 5,367 858 5,440
-------------------- -------- -------- ------------ --------
Net assets, beginning of period 38,411 6,847 12,614 7,168 9,731
-------------------- -------- -------- ------------ --------
Net assets, end of period $ 28,025 $ 5,250 $17,981 $ 8,026 $15,171
==================== ======== ======== ============ ========
Inter- Parti-
Aggressive national Bond General cipant
Balanced Growth Growth Index Mills Loan
Fund Fund Fund Fund Fund Fund Total
---------- ------------ ---------- ------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Additions To Net Assets:
Contributions:
Participants $ 464 $ 295 $ 250 $ 45 $ 4,800
Employer 2,015
---------
464 295 250 45 - - 6,815
---------- ------------ ---------- ------- --------- -------- ---------
Investment income:
Dividends and interest 1,014 458 202 16 $ 311 $ 431 4,961
Net appreciation (depreciation) in fair
value of investments 1,111 38 (35) 14 2,298 18,033
Other additions 12 22 16 84
---------- ------------ ---------- ---------
2,137 518 183 30 2,609 431 23,078
---------- ------------ ---------- ------- --------- -------- ---------
Total Additions 2,601 813 433 75 2,609 431 29,893
---------- ------------ ---------- ------- --------- -------- ---------
Deductions From Net Assets:
Distribution to participants (1,401) (536) (697) (3) (1,569) (1,295) (14,472)
Administrative expenses (3) (1) (1) (6) (48)
---------- ------------ ---------- --------- ---------
(1,404) (537) (698) (3) (1,575) (1,295) (14,520)
---------- ------------ ---------- ------- --------- -------- ---------
Net Increase (Decrease) Prior to Transfers 1,197 276 (265) 72 1,034 (864) 15,373
Transfer to Ralston Resorts Savings
Investment Plan (837) (501) (776) (903) (7,469)
Interfund transfers 2,247 507 356 482 6,416 (219) -
---------- ------------ ---------- ------- --------- -------- ---------
Net increase (decrease) 2,607 282 (685) 554 6,547 (1,083) 7,904
---------- ------------ ---------- ------- --------- -------- ---------
Net assets, beginning of period 9,555 4,387 5,181 - - 6,454 100,348
---------- ------------ ---------- ------- --------- -------- ---------
Net assets, end of period $ 12,162 $ 4,669 $ 4,496 $ 554 $ 6,547 $ 5,371 $108,252
========== ============ ========== ======= ========= ======== =========
<FN>
See accompanying notes to financial statements.
</TABLE>
<PAGE>6
<TABLE>
<CAPTION>
RALCORP HOLDINGS, INC.
SAVINGS INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
(in thousands)
Year Ended December 31, 1996
------------------------------------------------------------
Participant Directed
------------------------------------------------------------
U.S. Growth
Ralcorp Fixed Equity Government and
Stock Income Index Money Income
Fund Fund Fund Market Fund
--------------- -------- -------- ------------ --------
<S> <C> <C> <C> <C> <C>
Additions To Net Assets:
Contributions:
Participants $ 5,582 $ 142 $ 290 $ 127 $ 340
Employer 4,866
---------------
10,448 142 290 127 340
--------------- -------- -------- ------------ --------
Investment income:
Dividends and interest 438 279 357 695
Net appreciation (depreciation) in fair
value of investments (5,803) (23) 2,136 1,267
--------------- -------- -------- --------
(5,803) 415 2,415 357 1,962
--------------- -------- -------- ------------ --------
Total Additions 4,645 557 2,705 484 2,302
--------------- -------- -------- ------------ --------
Deductions From Net Assets:
Distribution to Participants (4,890) (1,382) (1,628) (1,605) (1,132)
Administrative expenses (27) (2) (4) (4) (3)
--------------- -------- -------- ------------ --------
(4,917) (1,384) (1,632) (1,609) (1,135)
--------------- -------- -------- ------------ --------
Net Increase (Decrease) Prior to Transfers (272) (827) 1,073 (1,125) 1,167
Transfer to American Redemption Systems
Savings Investment Plan (229) (120) (263) (162) (99)
Interfund transfers (4,173) 26 1,263 1,293 705
--------------- -------- -------- ------------ --------
Net increase (decrease) (4,674) (921) 2,073 6 1,773
--------------- -------- -------- ------------ --------
Net assets, beginning of period 43,085 7,768 10,541 7,162 7,958
--------------- -------- -------- ------------ --------
Net assets, end of period $ 38,411 $ 6,847 $12,614 $ 7,168 $ 9,731
=============== ======== ======== ============ ========
Inter- Parti-
Aggressive national cipant
Balanced Growth Growth Loan
Fund Fund Fund Fund Total
---------- ------------ ---------- -------- ---------
<S> <C> <C> <C> <C> <C>
Additions To Net Assets:
Contributions:
Participants $ 318 $ 269 $ 265 $ 7,333
Employer 4,866
---------
318 269 265 - 12,199
---------- ------------ ---------- -------- ---------
Investment income:
Dividends and interest 762 244 223 $ 535 3,533
Net appreciation (depreciation) in fair
value of investments 649 274 462 (1,038)
---------- ------------ ---------- ---------
1,411 518 685 535 2,495
---------- ------------ ---------- -------- ---------
Total Additions 1,729 787 950 535 14,694
---------- ------------ ---------- -------- ---------
Deductions From Net Assets:
Distribution to Participants (1,275) (560) (660) (1,285) (14,417)
Administrative expenses (4) (2) (2) (48)
---------- ------------ ---------- ---------
(1,279) (562) (662) (1,285) (14,465)
---------- ------------ ---------- -------- ---------
Net Increase (Decrease) Prior to Transfers 450 225 288 (750) 229
Transfer to American Redemption Systems
Savings Investment Plan (66) (39) (87) (136) (1,201)
Interfund transfers 129 507 254 (4) -
---------- ------------ ---------- -------- ---------
Net increase (decrease) 513 693 455 (890) (972)
---------- ------------ ---------- -------- ---------
Net assets, beginning of period 9,042 3,694 4,726 7,344 101,320
---------- ------------ ---------- -------- ---------
Net assets, end of period $ 9,555 $ 4,387 $ 5,181 $ 6,454 $100,348
========== ============ ========== ======== =========
<FN>
See accompanying notes to financial statements.
</TABLE>
<PAGE>8
<TABLE>
<CAPTION>
SCHEDULE I
RALCORP HOLDINGS, INC.
SAVINGS INVESTMENT PLAN
ITEM 27A - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
December 31, 1997
Identity of issue, ----------------------
borrower, lessor or Fair
similar party Description of Investment Cost Value
- ----------------------- ---------------------------------------------- -------- --------
($in thousands)
<S> <C> <C> <C>
* Ralcorp Common Stock $ 20,293 $ 28,029
-------- --------
* Vanguard Wellington Fund 9,916 12,162
* Vanguard Explorer Fund 4,309 4,669
* Vanguard Money Market Reserve Fund - Federal Portfolio 8,026 8,026
* Vanguard Bond Index Fund 544 554
* Vanguard Index Trust - 500 Portfolio 11,740 17,981
* Vanguard Windsor II Fund 12,049 15,171
* Vanguard International Growth Portfolio 4,213 4,496
* Vanguard Retirement Savings Trust 4,714 4,724
* Vanguard Short Term Corporate Bond Fund 214 214
General Mills Common Stock 5,573 6,547
-------- --------
Total Investment in Shares in Registered
Investment Company 61,298 74,544
-------- --------
American International Insurance Contracts 312 312
Life Assurance
Total Insurance Company Contracts 312 312
-------- --------
* Participant Loan Fund Participant loans interest rate 6.5% - 11.5% 5,371 5,371
-------- --------
$ 87,274 $108,256
======== ========
<FN>
* Party in interest
</TABLE>
<PAGE>9
<TABLE>
<CAPTION>
SCHEDULE II
ITEM 27D - SCHEDULE OF REPORTABLE TRANSACTIONS*
RALCORP HOLDINGS, INC.
SAVINGS INVESTMENT PLAN
01/01/97 THROUGH 12/31/97
CURRENT VALUE OF
IDENTITY OF PARTY INVOLVED/ PURCHASE SELLING ASSET ON
DESCRIPTION OF ASSET PRICE PRICE COST OF ASSET TRANSACTION DATE GAIN OR (LOSS)
<S> <C> <C> <C> <C> <C>
RALCORP COMMON STOCK FUND $10,752,031.02 $ 10,752,031.02
$12,979,706.20 $11,824,509.16 12,979,706.20 $ 1,155,197.04
FIXED INCOME FUND 2,244,137.67 2,244,137.67
3,845,278.35 3,830,651.02 3,845,278.35 14,627.33
VANGUARD WELLINGTON FUND 4,750,280.23 4,750,280.23
3,263,411.99 2,668,802.47 3,263,411.99 594,609.52
VANGUARD EXPLORER FUND 2,659,685.10 2,659,685.10
2,435,967.90 2,299,647.70 2,435,967.90 136,320.20
VMMR FEDERAL PORTFOLIO 7,820,685.07 7,820,685.07
6,945,837.96 6,945,837.96 6,945,837.96 -
VANGUARD INDEX 500 PORTFOLIO 7,157,782.22 7,157,782.22
5,735,385.29 4,217,227.59 5,735,385.29 1,518,157.70
VANGUARD WINDSOR II 7,815,000.23 7,815,000.23
4,378,656.91 3,547,618.96 4,378,656.91 831,037.95
VANGUARD INTERNATIONAL GROWTH PORTFOLIO 2,137,692.02 2,137,692.02
2,803,706.72 2,467,397.83 2,803,706.72 336,308.89
GENERAL MILLS STOCK FUND 318,652.20 318,652.20
12,927,603.98 11,600,315.30 12,927,603.98 1,327,288.68
-------------- -------------- ----------------- ---------------
<FN>
* Transactions or series of transactions in excess of 5% of the current value of the Plan's assets as of the beginning of
the plan year as defined in Section 2520.103-6 of the Department of Labor Rules and Regulations for Reporting and
Disclosure of ERISA.
</TABLE>
<PAGE>10
RALCORP HOLDINGS, INC.
SAVINGS INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE 1: PRESENTATION OF FINANCIAL STATEMENTS
The Statement of Net Assets Available for Benefits with Fund Information
reflects actual balances as of December 31, 1997 and 1996, and the Statement
of Changes in Net Assets Available for Benefits with Fund Information reflects
the activity occurring during the years ended December 31, 1997 and 1996.
NOTE 2: DESCRIPTION OF PLAN
The following description of the Ralcorp Holdings, Inc. (Ralcorp or the
Company) Savings Investment Plan (the Plan) provides only general information.
Participants should refer to the Plan Document for a more complete description
of the Plan's provisions.
Plan Purpose. The Plan is a Defined Contribution Plan whose purpose is to
permit deferrals of compensation by eligible employees of the Company and its
subsidiaries, to enable them to share in the Company's performance through
participation in the Ralcorp Stock Fund and to provide them with an
attractive, convenient vehicle for accumulating capital for their future
economic security.
The Plan is subject to certain provisions of the Employee Retirement Income
Security Act of 1974, as amended (ERISA). The Plan is designed to meet
ERISA's reporting and disclosure and fiduciary responsibility requirements, as
well as meet the minimum standards for participation and vesting. The Plan is
not, however, subject to ERISA's minimum funding standards, nor are benefits
under the Plan eligible for termination insurance provided by the Pension
Benefit Guaranty Corporation (PBGC).
Eligibility. All regular sales, administrative and clerical employees and
certain production employees, depending on the terms and conditions of
employment, who receive regular compensation from a payroll subject to FICA in
the United States are eligible to participate to the extent permitted by the
Plan or applicable law. In addition, the Plan requires completion of one year
of credited service with the Company prior to participation in the Plan. At
December 31, 1997 and 1996, there were a total of 2,052 and 2,576
participants, respectively, in the Plan.
Plan Administration. The Plan is administered by the Company. Except as to
matters required by the terms of the Plan to be decided by the Company's Board
of Directors (the Board), the Company's Benefits Administration Committee
(BAC) has the right to interpret the Plan and to decide certain matters
arising under the Plan. The Board has designated the Company's Employee
Benefit Trustees Committee (EBTC) as having certain rights and obligations to
control and manage Plan assets, to select investment funds available for
investment by Plan participants, and to appoint and remove the Trustee and any
investment managers retained in connection with the investment of Plan assets.
Plan Contributions. Participants may make maximum contributions to the Plan
equal to the lesser of $30,000 or 15% of their compensation for that year.
Subject to such limitations, participants may make basic contributions of 2%
to 12% of their compensation, in 1% increments, on a pre-tax basis. For
employees first hired by Ralston Purina Company (Ralston) before June 30, 1993
and who were employed by the Company on April 1, 1994, the Company will make a
100% matching contribution on the first 6% of such participant's basic
contributions; both the participant's basic contribution, up to 6% of their
compensation, and the Company match are invested solely in the Ralcorp Stock
Fund. Participant basic contributions in excess of 6% of their compensation
may be invested in any of the other Plan investment funds. For employees not
meeting the hiring date criteria, the Company match each year will be 20% of
that year's current maximum Company match for each year of service, reaching
100% after five years. Effective on April 1, 1997, for each dollar contributed
by participants, up to 6% of pre-tax earnings, the Company will contribute
$.50. Also effective on this date, participant contributions may be invested
<PAGE>11
RALCORP HOLDINGS, INC.
SAVINGS INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
in any of the available investment funds, while the Company match will be
invested solely in the Ralcorp Stock Fund. Company match will be graduated
based on years of service as follows: one year of service equates to a 15%
Company match, two years of service equates to a 30% Company match and three
or more years of service entitles the employee to the maximum Company match of
50%. Participant basic contributions in excess of 6% of their compensation
may be invested in any of the other Plan investment funds. Participant
contributions and earnings thereon are vested and non-forfeitable from the
time made. Company matching contributions and earnings thereon will vest at a
rate of 25% for each year of credited Company service (including service prior
to April 1, 1994 with Ralston Purina Company) by the participant.
Participants may also, subject to the $30,000 and 15% limitations, make
supplemental, unmatched contributions of 1% to 10% of their compensation, in
1% increments. Such contributions are made on an after-tax basis and are
immediately vested.
Employees of several of the Company's production facilities are subject to
different matching contribution levels and are not eligible to make
supplemental contributions.
Investment of Funds. All contributions will be deposited by the Company in a
Trust Fund held by Vanguard Fiduciary Trust Company (Trustee) or any successor
selected by the EBTC. The value of the Trust Funds will change according to
increases or decreases in market value of the assets, gain or loss on sale of
assets and income from dividends and interest held therein. In addition,
Vanguard performs all record keeping functions for the Plan.
The Trustee will maintain as many separate Investment Funds within its Trust
Funds, with such different investment objectives, as the EBTC deems advisable.
As of December 31, 1997, the following funds have been established for
participants: the Ralcorp Stock Fund, the Fixed Income Fund, the Equity Index
Fund, the U.S. Government Money Market Fund, the Growth and Income Fund, the
Balanced Fund, the Aggressive Growth Fund, the International Growth Fund,
the General Mills Fund and the Bond Index Fund.
Plan Withdrawals, Loans and Forfeitures. Upon termination of a participant,
retirement, disability, or death, or in the event of termination of the Plan
without establishment of a successor plan, the amount in the Trust Fund
credited to each participant which is vested will be distributed to him, his
beneficiary or other legal representative. Under the Plan, a participant may
elect from several payment alternatives on the timing and nature of
distributions. Plan withdrawals may be made prior to termination or
retirement for cases of hardship. Such distributions are limited to the
amount required to meet the need created by the hardship and are made in
accordance with guidelines determined by the Company.
The Company may, subject to certain rules and regulations, permit a
participant to borrow from the Trust Funds. Such loans will be permitted for
any purpose provided certain Plan conditions and certain other conditions as
prescribed by federal law are met.
Upon termination, any Company matching contribution and the earnings thereon
which are not vested will be forfeited, but will be restored if the
participant again becomes an eligible employee within five years after
termination. Amounts forfeited will be used to reduce Company matching
contributions required under the Plan. Forfeitures net of amounts restored
during the years ended December 31, 1997 and 1996 were approximately $26,269
and $41,800, respectively, and are included in employer contributions on the
statements of changes in net assets available for benefits with fund
information for the years ended December 31, 1997 and 1996.
<PAGE>12
RALCORP HOLDINGS, INC.
SAVINGS INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
Plan Amendments and Termination. The Board, and in certain limited
circumstances the EBTC and the Chief Executive Officer of the Company, may
amend the Plan. The Board may also terminate the Plan or direct that Company
matching contributions cease. In such cases, non-forfeitable rights to the
Company matching contributions credited to a participant's account shall
automatically vest in such participant. Under the Plan, a participant may
elect from several alternative rules on the timing and nature of distribution.
NOTE 3: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies followed by the Plan are described below:
Basis of Accounting. The accompanying financial statements of the Plan are
prepared using the accrual basis of accounting.
Use of Estimates. The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of additions to and deductions from net
assets, during the reporting period. Actual results could differ from these
estimates.
Investments. Plan investments in common stock and shares of registered
investment companies are carried at fair market value based on closing prices
on the last business day of the Plan year. Realized gains and losses are
determined using the average cost method. Interest income is recognized as
earned and dividend income is recognized on the date of record. Plan
investments in various insurance company contracts are carried at contract
value, which approximates fair value. Participant loans are valued at cost
which approximates fair value. Net appreciation in fair value of investments
is comprised of the change in market value compared to the cost of investments
retained in the Plan, and realized gains and losses on security transactions
which represents the difference between proceeds and costs.
Payment of Benefits. Benefits are recorded when paid.
NOTE 4: INVESTMENTS
Except for its investment contract with an insurance company, the Plan's
investments are held in a trust fund. The following table presents
investments. Investments that represent 5 percent or more of the Plan's net
assets are separately identified.
<TABLE>
<CAPTION>
December 31,
1997 1996
---------- --------
<S> <C> <C>
INVESTMENTS AT FAIR VALUE AS DETERMINED BY ($in thousands)
QUOTED MARKET PRICE
Common stocks:
Ralcorp Holdings, Inc. $ 28,029 $ 38,415
General Mills, Inc. 6,547 -
Mutual funds:
Vanguard Index Trust - 500 Portfolio 17,981 12,613
Vanguard Money Market Reserves -
Federal Portfolio 8,026 7,167
Vanguard Wellington Fund 12,162 9,553
Vanguard Windsor II 15,171 9,730
Other 14,657 15,684
---------- --------
102,573 93,162
---------- --------
INVESTMENTS AT ESTIMATED FAIR VALUE
Participant Loans 5,371 6,454
---------- --------
INVESTMENTS AT CONTRACT VALUE
Investment contract with American International
Life Asssurance 312 729
---------- --------
Total Investments $ 108,256 $100,345
========== ========
</TABLE>
<PAGE>13
RALCORP HOLDINGS, INC.
SAVINGS INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
During 1997 the Plan's investments (including investments bought, sold, and
held during the year) appreciated in value by $18,032,494 as follows:
<TABLE>
<CAPTION>
NET CHANGE IN FAIR VALUE
Year Ended
December 31, 1997
-------------------
<S> <C>
INVESTMENTS AT FAIR VALUE AS DETERMINED BY QUOTED ($in thousands)
MARKET PRICE
Common stock $ 10,992
Mutual funds 7,041
-------------------
Net change in fair value $ 18,033
===================
</TABLE>
NOTE 5: RELATED PARTY TRANSACTIONS
Certain Plan investments are shares of Ralcorp common stock. Ralcorp is the
Plan sponsor and, therefore, these transactions qualify as party-in-interest.
At December 31, 1997 these shares had a total cost of $20,292,662 and market
value of $28,028,544. During the year, the Plan purchased $10,752,031 and
sold $12,979,706 of such assets.
Certain Plan investments are shares of mutual funds managed by Vanguard.
Vanguard is the trustee as defined by the Plan and, therefore, these
transactions qualify as party-in-interest. At December 31, 1997 these shares
had a total cost of $55,725,180 and market value of $67,996,768. During the
year, the Plan purchased $32,341,125 and sold $25,562,967 of such assets.
Fees paid by the Plan for the investment management services amounted to
$48,000 for the year ended December 31, 1997.
NOTE 6: INCOME TAX STATUS
The Plan has received a determination letter from the Internal Revenue Service
that the Plan does in fact constitute a qualified plan and that the trust is
exempt from income tax under the Internal Revenue Code of 1986, as amended.
Participants' basic contributions, Company matching contributions and earnings
of Plan investments are not subject to federal income tax until distributed
from the Plan. Supplemental contributions are made from a participant's
after-tax compensation. Earnings related to these supplemental contributions
are not, however, subject to federal income tax as long as they remain in the
Plan.
NOTE 7: PLAN TRANSFERS
On January 31, 1997 the Company sold its Branded Cereal and Snack Business
(Branded Business) to General Mills, Inc. (General Mills). This transaction
resulted in a distribution of General Mills stock to Ralcorp shareholders of
record on January 31, 1997. The Plan received its distribution of General
Mills stock, which is reported in the financial statements as an interfund
transfer, and created the General Mills Stock Fund to hold the stock.
Participants were allocated their respective shares of General Mills stock
based on their Ralcorp Stock Fund balance. No contributions or transfers to
the fund are permitted by the Plan.
<PAGE>14
RALCORP HOLDINGS, INC.
SAVINGS INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
The assets of former Ralcorp employees which were hired by General Mills, as a
result of the sale of the Branded Business, are maintained by the Plan. These
participants are permitted to transfer assets among Plan funds, but are not
permitted to make contributions or receive new loans.
The account balances of certain Plan participants who were employed by the
Company's all-season resort subsidiary, Ralston Resorts, were transferred to
the Ralston Resorts Savings Investment Plan (Resorts SIP). Prior to this
transfer, sponsorship of the Resorts SIP had been transferred to Vail Resorts,
Inc., which had acquired Ralston Resorts on January 3, 1997. The amount of
such transfers is reflected on the Statement of Changes in Net Assets
Available for Benefits with Fund Information for the year ended December 31,
1997.
On February 29, 1996, the Company completed the sale of its American
Redemption Systems, Inc. (ARS) subsidiary to NuWorld Marketing Limited. As a
result, account balances (including non-vested portions) related to ARS
employees were transferred from the Plan to an ARS Savings Investment Plan.
The amount of such transfers is reflected on the Statement of Changes in Net
Assets Available for Benefits with Fund Information for the year ended
December 31, 1996.
NOTE 8: SUBSEQUENT EVENT
On January 30, 1998 assets in the General Mills Stock Fund were liquidated.
The proceeds resulting from the sale of these assets were transferred to the
U.S. Government Money Market fund.
<PAGE>15
REPORT OF INDEPENDENT ACCOUNTANTS
June 24, 1998
To the Participants and the
Plan Administrator of the
Ralcorp Holdings, Inc.
Savings Investment Plan
In our opinion, the accompanying statements of net assets available for
benefits and the related statements of changes in net assets available for
benefits present fairly, in all material respects, the net assets available
for benefits of the Ralcorp Holdings, Inc. Savings Investment Plan at December
31, 1997 and 1996, and the changes in net assets available for benefits for
the plan years then ended, in conformity with generally accepted accounting
principles. These financial statements are the responsibility of the plan's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these statements
in accordance with generally accepted auditing standards which 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, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for the opinion expressed above.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The additional information included in
the supplemental schedules is presented for purposes of additional analysis
and is not a required part of the basic financial statements but is additional
information required by ERISA. The fund information in the statements of net
assets available for benefits and the statements of changes in net assets
available for benefits is presented for purposes of additional analysis rather
than to present the net assets available for benefits and changes in net
assets available for benefits of each fund. The supplemental schedules and
fund information have been subjected to the auditing procedures applied in the
audits of the basic financial statements and, in our opinion, are fairly
stated in all material respects in relation to the basic financial statements
taken as a whole.
PRICE WATERHOUSE LLP
St. Louis, Missouri
<PAGE>16
SIGNATURE
The Plan.
Pursuant to the requirements of the Securities Exchange Act of 1934, the
members of the Ralcorp Holdings, Inc. Employee Benefit Trustees Committee have
duly caused this annual report to be signed by the undersigned hereunto duly
authorized.
RALCORP HOLDINGS, INC.
EMPLOYEE BENEFIT TRUSTEES COMMITTEE
By /s/ D. J. SESCLEIFER
----------------------
D. J. Sescleifer, Chairman
Ralcorp Holdings, Inc.
Employee Benefit Trustees Committee
June 26, 1998
<PAGE>1
EXHIBIT INDEX
Exhibits
- --------
23 Consent of Independent Accounts
<PAGE>2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 333-20881) of Ralcorp Holdings, Inc. of our report
dated June 24, 1998 appearing on page 15 of the Ralcorp Holdings, Inc. Savings
Investment Plan's Annual Report on Form 11-K for the Plan year ended December
31, 1997.
PRICE WATERHOUSE LLP
St. Louis, Missouri
June 25, 1998
