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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1994
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
For Quarter Ended March 31, 1994 Commission file number 1-800
WM. WRIGLEY JR. COMPANY
(Exact name of registrant as specified in its charter)
DELAWARE 36-1988190
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
410 North Michigan Avenue
Chicago, Illinois 60611
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code) 312-644-2121
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 .
90,811,623 shares of Common Stock and 25,562,495 shares of Class B
Common Stock were outstanding as of April 15, 1994.
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FORM 10-Q
PART I - FINANCIAL INFORMATION - ITEM 1
WM. WRIGLEY JR. COMPANY
STATEMENT OF CONSOLIDATED EARNINGS (CONDENSED)
Three Months Ended
March 31
1994 1993
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Revenues:
Net sales $ 378,557 332,333
Investment and other income 2,551 2,140
Nonrecurring gain on sale of
Singapore property 38,102 -
Total revenues 419,210 334,473
Costs and expenses:
Cost of sales 162,936 145,113
Selling, distribution, and
general administrative 137,059 122,240
Interest 582 240
Total costs and expenses 300,577 267,593
Earnings before income taxes 118,633 66,880
Income taxes 42,691 24,520
Net earnings $ 75,942 42,360
Net earnings per average share of
common stock $ .65 .36
Dividends declared per share of
common stock $ .12 .10
Average number of shares
outstanding for the period 116,393,296 116,696,424
All dollar amounts in thousands except for per share values.
SEE ACCOMPANYING NOTES ON PAGE 5
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FORM 10-Q
PART I - FINANCIAL INFORMATION - ITEM 1 (Cont'd)
WM. WRIGLEY JR. COMPANY
STATEMENT OF CONSOLIDATED CASH FLOWS (CONDENSED)
Three Months Ended
March 31,
1994 1993
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CASH FLOWS - OPERATING ACTIVITIES
Net earnings $ 75,942 42,360
Adjustments to reconcile net earnings to net
cash flows from operating activities:
Depreciation 9,016 7,270
(Gain) Loss on sales of property, plant, and
equipment (38,321) 149
(Increase) decrease in:
Accounts receivable (34,034) (36,224)
Inventories (17,533) (7,203)
Other current assets (240) (3,696)
Other assets and deferred charges 11,378 (3,940)
Increase (decrease) in:
Accounts payable 2,549 8,004
Accrued expenses 1,686 12,764
Income and other taxes payable 39,543 9,578
Deferred taxes (6,725) (124)
Other noncurrent liabilities 3,120 632
Net cash flows - operating activities 46,381 29,570
CASH FLOWS - INVESTING ACTIVITIES
Additions to property, plant, and equipment (9,675) (16,819)
Proceeds from property retirements 39,163 868
Purchases of short-term investments (81,971) -
Maturities of short-term investments 86,890 -
Net (increase) decrease in short-term investments - 9,426
Net cash flows - investing activities 34,407 (6,525)
CASH FLOWS - FINANCING ACTIVITIES
Dividends paid (11,640) (11,668)
Common stock purchased (5,600) (5,291)
Net cash flows - financing activities (17,240) (16,959)
Effect of exchange rate changes on cash and
cash equivalents 673 1,998
Net increase in cash and cash equivalents 64,221 8,084
Cash and cash equivalents at beginning of period 86,290 84,144
Cash and cash equivalents at end of period $ 150,511 92,228
SUPPLEMENTAL CASH FLOW INFORMATION
Income taxes paid $ 10,105 16,289
Interest paid $ 577 237
Interest and dividends received $ 2,224 2,264
All dollar amounts in thousands.
SEE ACCOMPANYING NOTES ON PAGE 5
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<TABLE>
FORM 10-Q
PART I - FINANCIAL INFORMATION - ITEM 1 (Cont'd)
WM. WRIGLEY JR. COMPANY
CONSOLIDATED BALANCE SHEET (CONDENSED)
March 31, December 31,
1994 1993
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Current assets:
Cash and cash equivalents $ 150,511 86,290
Short-term investments 98,615 103,556
Accounts receivable 153,921 118,222
(less allowance for doubtful accounts;
3/31/94-$4,896; 12/31/93-$4,407)
Inventories -
Finished goods 54,266 47,471
Raw materials and supplies 141,392 129,325
195,658 176,796
Other current assets 11,888 11,511
Deferred income taxes - current 5,901 5,918
Total current assets 616,494 502,293
Marketable equity securities at fair value 30,038 31,417
Other assets and deferred charges 18,823 25,881
Deferred income taxes - noncurrent 20,918 15,865
Property, plant and equipment, at cost 558,684 550,877
Less accumulated depreciation 318,565 311,009
240,119 239,868
Total assets $ 926,392 815,324
Current liabilities:
Accounts payable $ 65,696 62,621
Accrued expenses 69,680 67,137
Dividends payable 13,965 11,640
Income and other taxes payable 57,302 17,127
Deferred income taxes - current 470 636
Total current liabilities 207,113 159,161
Deferred income taxes - noncurrent 20,685 22,716
Other noncurrent liabilities 61,804 58,265
Stockholders' equity:
Preferred stock - no par value
Authorized - 20,000,000 shares
Issued - None
Common stock - no par value
Authorized - 400,000,000 shares
Issued - 90,811,623 shares at 3/31/94;
90,588,065 shares at 12/31/93 12,082 12,078
Class B Common Stock - convertible
Authorized - 80,000,000 shares
Issued and outstanding -
25,562,495 shares at 3/31/94;
25,812,424 shares at 12/31/93 3,438 3,442
Additional paid-in capital 1,457 1,467
Retained earnings 626,617 564,640
Foreign currency translation adjustment (22,885) (24,757)
Unrealized holding gains on marketable equity
securities 17,415 18,312
Common Stock in treasury, at cost - 26,371
shares at 3/31/94; 0 shares at 12/31/93 (1,334) -
Total stockholders' equity 636,790 575,182
Total liabilities & stockholders' equity $ 926,392 815,324
All dollar amounts in thousands.
SEE ACCOMPANYING NOTES ON PAGE 5.
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FORM 10-Q
PART I - FINANCIAL INFORMATION - ITEM 1 (Cont'd)
WM. WRIGLEY JR. COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONDENSED)
1. The Statement of Consolidated Earnings (Condensed) for the
three month periods ended March 31, 1994 and 1993, the
Statement of Consolidated Cash Flows (Condensed) for the
three month periods ended March 31, 1994 and 1993, and the
Consolidated Balance Sheet (Condensed) at March 31, 1994 are
unaudited. In the Company's opinion, the accompanying
financial statements reflect all adjustments (which include
only normal recurring adjustments) necessary to present fairly
the results for the periods, and have been prepared on a basis
consistent with the 1993 audited consolidated financial
statements. These condensed financial statements should be
read in conjunction with the 1993 consolidated financial
statements and related notes.
2. An analysis of the cumulative foreign currency translation
adjustment follows (in thousands of dollars).
Decrease (Increase) to
Stockholders' Equity
First Quarter 1994 1993
Balance at January 1 $24,757 9,692
Translation adjustment for the
first quarter (1,872) 3,002
Balance at March 31 $22,885 12,694
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FORM 10-Q
PART I - FINANCIAL INFORMATION - ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
RESULTS OF OPERATIONS
Revenues
Net Sales
The 1994 first quarter net sales of $378.6 million was an increase of
nearly 14% from the prior year. This increase was primarily due to
higher worldwide volume with overseas sales being a major contributor
to the gain. This increase was moderated somewhat by translation to
a stronger U.S. Dollar.
Investment and Other Income
The 1994 first quarter investment and other income increased by 19%
due primarily to larger amounts invested.
Costs and Expenses
Cost of Sales
Cost of sales for the first quarter 1994 increased $17.8 million
or 12% compared to the prior year. This was mainly due to higher
international shipment volume and the continued trend toward more
sugarfree products.
The consolidated gross profit percentage for the first quarter of
1994 was 57.0%, compared to 56.3% for the prior year. Lower unit
product cost, mainly in the U.S., contributed to the gross margin
improvement.
Selling, Distribution, and General Administrative
The selling, distribution, and general administrative expenses for
the first quarter of 1994 increased $14.8 million or 12.1% from the
prior year. Advertising expenses accounted for a substantial amount
of the increase.
Net Earnings
In January 1994, the Company sold its real estate holdings in
Singapore for a pre-tax gain of $38.1 million. This nonrecurring
gain increased net earnings by an after-tax amount of $24.8 million
or $.21 per share.
Total net earnings for the first quarter of 1994 were $75.9 million,
an increase of $33.6 million or 79%. On a per share basis, earnings
were $.65, an increase of $.29 or 81%. Excluding the nonrecurring
Singapore gain, the earnings increases were $8.8 million or 21% and
$.08 per share or 22%.
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FORM 10-Q
PART I - FINANCIAL INFORMATION - ITEM 2 (Cont'd)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 1994 the Company's cash and cash equivalents and short-
term investments totaled $249.1 million compared to $189.8 million at
December 31, 1993 - an increase of $59.2 million. The ratio of
current assets to liabilities (current ratio) at March 31, 1994 was
3.0 to 1 compared to 3.2 to 1 at December 31, 1993.
Capital expenditures for 1994 are expected to be higher than 1993's
expenditures of $63.1 million and are expected to be funded from the
Company's operations and internal sources including the proceeds from
the sale of real estate holdings in Singapore.
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FORM 10-Q
PART II - OTHER INFORMATION
Item 4 - Submission of Matters to Vote of Security Holders
The Annual Meeting of Stockholders of the Wm. Wrigley Jr. Company
was held on March 8, 1994 to consider the following proposals: 1,
the election of nine directors to serve for the ensuing year; and 2,
ratification of the appointment of Ernst & Young as the Company's
independent auditors for 1994. The results of the voting on each
matter, as determined by the independent inspectors of election, are
as follows:
Proposal 1. Election of nine directors. With each class of
stock voting together, a total of 348,469,854 votes were
eligible to be cast and a total of 313,404,926 were submitted
with respect to each nominee as follows:
Nominee For % For Withheld
Charles F. Allison III 313,021,702 99.88 383,224
Lee Phillip Bell 313,099,334 99.90 305,592
Robert P. Billingsley 313,045,175 99.89 359,751
R.D. Ewers 313,158,945 99.92 245,981
Gary E. Gardner 313,072,361 99.89 332,565
Penny Sue Pritzker 313,072,167 99.89 332,759
Richard K. Smucker 313,083,308 99.90 321,618
William Wrigley 313,158,056 99.92 246,870
William Wrigley, Jr. 313,145,749 99.92 259,177
Proposal 2. Ratification of Auditors. With each class of
stock voting together, a total of 348,469,854 votes were
eligible to be cast and a total of 313,404,926 were submitted
as follows:
For Against Abstain
312,568,573 449,069 387,284
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FORM 10-Q
PART II - OTHER INFORMATION
Item 5 - Other Information
At its meeting of August 18, 1993, the Board of Directors
adopted a resolution authorizing the Company to purchase from
time to time shares of the Company's Common Stock not to exceed
$100,000,000 in aggregate price.
The Company's Management Incentive Plan (MIP) authorizes the
granting of up to 5,400,000 shares of the Company's Common Stock
(including 492,222 shares issued under the predecessor 1984 Stock
Award Plan) to key managers in various forms including stock
grants and stock appreciation rights. Shares so awarded may be
issued from the Company Treasury or purchased in the open market.
The Company Stock Retirement Plan for Non-employee Directors
authorizes award of up to 300,000 shares in the aggregate to
non-employee directors upon their retirement from the Board.
Shares so awarded may be issued from the Company Treasury or
purchased in the open market.
During the first quarter of 1994, 120,000 shares were purchased
under the above resolutions at an aggregate purchase price of
$5,600,150. Of these 93,629 shares were awarded under employee
benefit programs, and 26,371 shares were retained as Treasury
Stock by the Company for future uses to be determined.
Item 6 - Exhibits and Reports on Form 8-K
(b) The Company has not filed a Form 8-K for the three month period
ended March 31, 1994.
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FORM 10-Q
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.
WM. WRIGLEY JR. COMPANY
(Registrant)
By
Dennis J. Yarbrough
Corporate Controller
By
Dushan Petrovich
Vice President - Treasurer
Date May 13, 1994
