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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
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CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): OCTOBER 7, 1998
GORGES/QUIK-TO-FIX FOODS, INC.
(Exact name of registrant as specified in its charter)
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<S> <C> <C>
DELAWARE 333-20155 58-2263508
(State or other jurisdiction (Commission File Number) (IRS Employer Identification No.)
of incorporation)
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9441 LBJ FREEWAY
SUITE 214
DALLAS, TEXAS 75243
(Address of Principal Executive Offices)
972-690-7675
(Registrant's telephone number, including area code)
Page 1 of 6
Index to Exhibits on Page 4
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Item 5. OTHER EVENTS.
On October 7, 1998, Gorges/Quik-to-Fix Foods, Inc. (the "Company") issued a
press release announcing its intent to offer for sale one of its manufacturing
facilities in connection with its decision to exit the ground beef business.
The press release issued in connection therewith is filed herewith as Exhibit
99.1.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) Exhibits
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Exhibit No. Description
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99.1 Press Release of the Company dated October 7, 1998
2
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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 hereunto duly authorized.
GORGES/QUIK-TO-FIX FOODS, INC.
(Registrant)
Date: October 21, 1998 By /s/ A. Scott Letier
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A. Scott Letier
Chief Financial Officer
3
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INDEX TO EXHIBITS
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Exhibit
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99.1 Press Release of the Company dated October 7, 1998
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EXHIBIT 99.1
October 7, 1998
DALLAS, TX-- Gorges/Quik-to-Fix Foods, Inc., today announced its intent to exit
the raw ground beef business, citing higher costs of production, continued
ground beef margin pressure, and a desire to concentrate on its core value added
product offerings. The Company's ground beef product line primarily consists of
IQF (individually quick-frozen) raw hamburger patties, which in the current year
has generated approximately $54 million in sales on 60 million pounds in sales
volume. "Our operating costs have been increasing due to regulatory issues and
risks associated with the sale of raw ground beef, and there is no room in the
already slim margin to absorb the increased costs. We are one of the middle tier
producers of IQF raw ground beef, profitability has already been strained by
market conditions and consolidations, and the risks for us now far outweigh the
rewards." stated David Culwell, CEO of Gorges/Quik-to-Fix.
While the raw ground beef segment was approximately 40% of the Company's sales
volume, almost all of the Company's gross margin and operating cash flow is
generated by its value-added segment of fully cooked and ready to cook beef,
pork and poultry items. Mr. Culwell further stated, "This realignment of our
business will allow us to focus all of our available time and resources on the
part of the business we have always felt is the future of our Company."
The Company operates four plants, three dedicated totally to production of the
Company's signature lines of value added product, and one that is primarily a
raw ground beef facility. As a part of this decision, the Company has put up for
sale the facility that processes primarily ground beef, and is currently holding
discussions with potential buyers. "This approach will afford our Company's
employees the most orderly transition. Also, while we are anxious to devote our
full attention to the value added product line, which is the mainstay of our
business, we will not allow this decision to create a hardship for our valued
customers. Our three remaining plants are state of the art, have sufficient
capacity to meet foreseeable needs, and are more than capable of providing our
customers with the quality product they expect from us." said Mr. Culwell
The company anticipates a significant charge to earnings in its fiscal fourth
quarter as a result of this restructuring. Since the timing of any sale, the
amount of resulting proceeds, and final key dates in the realignment plan are
unknown, the amount of the charge can not be determined at this time.
GORGES/QUIK-TO-FIX FOODS, INC., is a leading producer, marketer and distributor
of quality value added processed fresh and frozen beef, pork and poultry
products supplied primarily to the foodservice industry under its GORGES(R) and
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QUIK-TO-FIX(R) brands. In addition, the Company co-packs a variety of products
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for the retail trade as well as other foodservice
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outlets, and is also a converter of protein products under the USDA Commodity
Reprocessing Program.
Certain statements in this news release regarding future expectations and
financial performance, other than historical information, may be regarded as
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Such statements are based on an assessment of a
variety of factors, contingencies and uncertainties deemed relevant by
management, including technological changes, competitive products and services,
management issues as well as risks described from time to time in the Company's
reports to the Securities and Exchange Commission, its annual report on Form 10-
K dated September 28, 1997 and subsequent filings on Form 10-Q. As a result, the
actual results realized by the Company could differ materially from the
statements made herein. For additional information on the Company's financial
condition and future plans see the company's quarterly report on form 10-Q for
the period ended June 27, 1998. Readers of these reports and this press release
are cautioned not to place undue reliance on the forward looking statements made
in this press release.
