SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 8-K
Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 26, 1994
CLARK EQUIPMENT COMPANY
(Exact name of registrant as specified in its charter)
Delaware 1-5646 38-0425350
(State or other juris- (Commission (IRS Employer
diction of incorporation) File Number) Identification Number)
100 North Michigan Street
P. O. Box 7008
South Bend, Indiana
(Address of principal 46634
executive offices) (Zip Code)
Registrant's telephone number (219) 239-0100
including area code
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ITEM 5. OTHER EVENTS
On January 26, 1994, Registrant issued a press release regarding its
fourth quarter and full year 1993 results. A copy of this press
release is attached as Exhibit (99) and incorporated in this Item by
reference. The press release contains certain forward-looking
statements about Registrant as defined in paragraph (c) of Rule 3b-6,
"Liability for Certain Statements by Issuers" issued pursuant to the
Securities Exchange Act of 1934. The forward-looking statements of
Registrant published in the press release are reaffirmed hereby.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS
Exhibit (99) - Registrant's press release regarding its fourth quarter
and full year 1993 results issued January 26, 1994.
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.
CLARK EQUIPMENT COMPANY
/s/ John J. Moran, Jr.
John J. Moran, Jr.
Assistant Secretary
Date: January 26, 1994
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EXHIBIT (99)
NEWS RELEASE
Contact: Joe Fimbianti Release Date: IMMEDIATE
219/239-0176
CLARK REPORTS PROFITABLE 1993;
SIGNIFICANTLY IMPROVED RESULTS FROM OPERATIONS
SOUTH BEND, INDIANA, January 26, 1994 -- Clark Equipment Company (NYSE:
CKL) today announced net income of $48 million, or $2.76 per share,
for 1993. Included in 1993 results is a gain of $6.2 million, or
$0.35 per share, related to a change in accounting for income taxes
from the Company's investment in VME Group N.V. These results compare
to 1992 net income of $66 million, or $3.81 per share, which included a
one-time benefit of $92 million for an accounting change for deferred
taxes and a $1.5 million net benefit from the sale and operating losses
of Clark's forklift truck business. Sales for 1993 were $874.9
million, up 9 percent from $802.7 million in 1992. The announcement
was made by Leo J. McKernan, Clark chairman, president, and chief
executive officer.
Commenting on the year's performance, Mr. McKernan said, "Our operating
businesses made solid gains in 1993. Clark consolidated operations,
which include Melroe, Clark-Hurth Components, and Clark Automotive
Products, delivered profits of $34 million, up 68 percent from $20.2
million in 1992, on a 9 percent sales increase. Similarly, the
performance of VME Group N.V., Clark's 50-percent-owned joint venture,
improved $55.9 million, with Clark's share of net operating income
rising to $7.8 million, despite a 9 percent sales decline." In 1992,
Clark's share of VME's losses was $48.1 million.
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In fourth quarter 1993, Clark recorded net income of $18.4 million, or
$1.06 per share, on sales of $220.3 million, compared to a loss of $2.8
million, or $0.16 per share, on sales of $191.3 million in the prior-
year period. There was substantial improvement in the operating
earnings of Clark consolidated businesses and VME. There was no LIFO
income in 1993, compared to $1.8 million in fourth quarter 1992.
Two special charges combined to lower Clark 1993 fourth quarter net
income by $5.2 million. These included (1) an expense related to stock
appreciation rights due to an increase in Clark's share price and (2) a
charge to field retrofit one skid-steer loader model with an additional
hydraulic lock-out system to prevent potential misuse. The negative
impact of these special charges was reduced by decreased provisions for
taxes in the fourth quarter related to Clark's ability to utilize
capital loss carryforwards in the U.S. and Brazil.
Incoming orders in the fourth quarter 1993 were $207 million, compared
to $224 million in third quarter 1993 and $147 million in fourth
quarter 1992. Order backlogs at December 31, 1993, were $146 million,
compared to $123 million at year-end 1992.
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Commenting on the results of Clark's consolidated businesses, Mr.
McKernan said, "Clark-Hurth's fourth quarter sales were flat compared
to the third quarter. The European recession was largely responsible
for reducing overall 1993 sales by more than 10 percent. However,
during the fourth quarter, incoming order and backlog trends improved,
especially in the European axle and transmission businesses. Even
though the market outlook is relatively flat again in 1994, Clark-Hurth
has reduced its breakeven level significantly and should be profitable
at 1993 sales volumes."
Regarding Brazil-based Clark Automotive Products, Mr. McKernan said,
"The business remained profitable, even with the normal seasonal fourth
quarter sales decline. Sales, orders, and earnings for fourth quarter
1993 increased compared to the prior-year period." The automotive,
light truck, and industrial sectors in Brazil also continued to improve
compared to 1992. The agricultural tractor and heavy truck sectors also
grew, but remained well below normal sales levels. Improved sales of
replacement parts also benefited margins.
"At Melroe, sales and orders increased compared to an unusually strong
third quarter," said Mr. McKernan. "This growth is coming from the
strong North American market, where industry fourth quarter retail
sales were up by more than 20 percent over 1992. In 1993, Melroe
market share also improved over 1992." He added that the strength in
North American markets was partially offset by the continued
deterioration in Europe, where skid-steer sales declined. Bobcat mini-
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excavator 1993 sales increased, as the product line made continued
headway in North America and Europe.
Discussing the performance of VME Group, Mr. McKernan noted, "Clark's
share of VME's net income increased to $10.3 million in the fourth
quarter from $1.8 million in the third quarter and a reported loss of
$7.4 million in fourth quarter 1992. Sales improved in Scandinavia,
North America, and Brazil over the third quarter, offsetting continuing
weakness in most European markets. Fourth quarter 1993 sales were
virtually unchanged from the prior-year period, reflecting substantial
margin gains from cost reduction efforts in 1992 and 1993 and the
devaluation of the Swedish Krona."
Mr. McKernan also noted that VME strengthened its worldwide position in
mining equipment markets by forming a joint venture with Hitachi
Construction Machinery in the rigid hauler business. Hitachi, which
holds a substantial minority ownership in the venture, will distribute
rigid haulers in Japan and select markets in Asia and Oceania. Hitachi
will also distribute VME's Volvo BM line of articulated haulers and
large wheel loaders in Japan.
Looking ahead, Mr. McKernan said, "We're cautiously optimistic about
1994. While we expect earnings for first quarter 1994 to be below
fourth quarter 1993 for seasonal reasons, first quarter results should
improve compared to the prior-year period. Clark operations will make
performance gains in 1994, even if markets remain flat during the
remainder of the year. Results will improve as our businesses continue
to benefit from previous cost reduction programs. When worldwide
markets strengthen, particularly in Europe, we expect further gains in
financial performance."
Clark Equipment Company's business is the design, manufacture, and sale
of skid-steer loaders, construction machinery, transmissions for on-
highway vehicles, and axles and transmissions for off-highway
equipment.
# # # # #
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CLARK EQUIPMENT COMPANY AND CONSOLIDATED SUBSIDIARIES
STATEMENT OF INCOME AND RETAINED EARNINGS (AUDITED)
<CAPTION>
For the Period Ended December 31, 1993
(Amounts in Thousands, except per share data) Fourth Quarter Twelve Months
1993 1992 1993 1992
<S> <C> <C> <C> <C>
Net sales....................................$ 220,283 $ 191,270 $ 874,917 $ 802,716
Operating costs and expenses:
Cost of goods sold......................... 179,294 156,863 700,370 663,565
Selling, general and
administrative expenses................. 30,276 26,492 118,504 99,821
209,570 183,355 818,874 763,386
Operating income.............................. 10,713 7,915 56,043 39,330
Other income, net............................. 657 4,068 11,939 16,885
Interest expense.............................. (2,721) (5,661) (21,506) (25,631)
Pre-tax income from consolidated operations... 8,649 6,322 46,476 30,584
Provision for income taxes.................... 642 1,736 12,447 10,361
Income from consolidated operations........... 8,007 4,586 34,029 20,223
Equity in net income (loss)
of associated company...................... 10,387 (7,363) 7,840 (48,083)
Income (loss) from continuing operations...... 18,394 (2,777) 41,869 (27,860)
Discontinued operations:
Income (loss) from operations.............. 0 0 0 (6,701)
Gain on sale............................... 0 0 0 8,519
Income from discontinued operations........... 0 0 0 1,818
Income (loss) before effect of
change in accounting principle............. 18,394 (2,777) 41,869 (26,042)
Effect of accounting change--income taxes..... - - 6,150 92,000
Net income (loss)............................. 18,394 (2,777) 48,019 65,958
Add: Income retained (accumulated deficit)
at beginning of period..................... 74,471 47,836 44,869 (20,899)
Deduct: Excess cost of treasury shares issued
over the cost of certain employee benefits. 157 190 180 190
Income retained at end of period.............$ 92,708 $ 44,869 $ 92,708 $ 44,869
Income (loss) per share:
From continuing operations................$ 1.06 $ (.16)$ 2.41 $ (1.60)
From discontinued operations............... - - - .10
From effect of accounting change........... - - .35 5.31
Net income (loss).........................$ 1.06 $ (.16)$ 2.76 $ 3.81
Average number of shares...................... 17,425 17,349 17,421 17,334
Number of shares outstanding
at end of period........................... 17,402 17,351 17,402 17,351
Sales by classes of products (In millions):
Off-highway...............................$ 174.2 $ 157.4 $ 690.6 $ 657.5
On-highway................................. 46.1 33.9 184.3 145.2
Total net sales..............................$ 220.3 $ 191.3 $ 874.9 $ 802.7
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CLARK EQUIPMENT COMPANY AND CONSOLIDATED SUBSIDIARIES
CONDENSED BALANCE SHEET (AUDITED)
<CAPTION>
(Amounts in Thousands)
Dec.31 Dec.31
ASSETS 1993 1992
<S> <C> <C>
Current Assets:
Cash, equivalents, and short-term investments.......$ 235,828 $ 191,924
Accounts and notes receivable........................ 77,103 66,151
Accounts receivable from associated companies........ 2,041 1,046
Refundable income taxes.............................. 3,543 0
Inventories.......................................... 108,620 100,817
Investment in discontinued operations-
remaining insurance operations ................... 0 9,648
Deferred tax assets--net............................. 29,202 21,341
Other current assets................................. 5,434 5,198
Total current assets.............................. 461,771 396,125
Investments and advances--associated companies.......... 122,106 121,314
Deferred tax assets--net ............................... 107,901 101,831
Property, plant and equipment--net...................... 201,924 216,196
Assets held for sale.................................... 6,765 9,676
Goodwill................................................ 67,461 81,653
Other assets............................................ 40,890 31,896
Total assets.....................................$1,008,818 $ 958,691
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes payable.......................................$ 22,512 $ 23,821
Accounts payable and accrued liabilities............. 150,142 118,195
Income taxes payable................................. 4,139 3,320
Accrued postretirement benefits...................... 19,560 19,000
Deferred income taxes................................ 800 963
Current installments on long-term debt............... 9,612 21,570
Total current liabilities......................... 206,765 186,869
Long-term borrowings.................................... 204,770 186,629
Other non-current liabilities........................... 74,686 90,508
Accrued postretirement benefits......................... 233,239 229,903
Deferred income taxes................................... 21,205 12,195
Total liabilities................................. 740,665 706,104
Stockholders' Equity:
Capital stock........................................ 323,540 323,164
Retained earnings.................................... 92,708 44,869
Cumulative translation and other adjustments......... (67,083) (28,843)
Common stock held in treasury at cost................ (49,728) (50,951)
Leveraged Employee Stock Ownership
Plan shares....................................... (31,284) (35,652)
Total stockholders' equity........................ 268,153 252,587
Total liabilities and stockholders' equity.......$1,008,818 $ 958,691
Debt/Capitalization Ratio............................... 46.9% 47.9%
Year-to-date capital expenditures......................$ 29,877 $ 37,284
Year-to-date depreciation charges......................$ 36,379 $ 44,120
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