<PAGE>
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the fiscal year ended April 30, 1995
Commission file number 0-10146
-------
ABRAMS INDUSTRIES, INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
GEORGIA 58-0522129
------------------------------- ---------------
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
5775-A Glenridge Drive, N.E., Suite 202, Atlanta, GA 30328
- ---------------------------------------------------- -----
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
Registrant's telephone number, including area code: (404) 256-9785
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Name of each exchange on
Title of each class: which registered:
NONE NONE
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
Common Stock, $1.00 Par Value Per Share
(Title of Class)
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 by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained to
the best of the Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. X
---
THE AGGREGATE MARKET VALUE OF THE VOTING STOCK HELD BY NONAFFILIATES OF THE
REGISTRANT AS OF JUNE 30, 1995, WAS $7,280,890. SEE PART III. THE NUMBER OF
SHARES OF COMMON STOCK OF THE REGISTRANT OUTSTANDING AS OF JUNE 30, 1995, WAS
2,992,940.
DOCUMENTS INCORPORATED BY REFERENCE
THE INFORMATION CALLED FOR BY PART III (ITEMS 10, 11, 12 AND 13) IS
INCORPORATED HEREIN BY REFERENCE TO THE REGISTRANT'S DEFINITIVE PROXY
STATEMENT FOR THE 1995 ANNUAL MEETING OF SHAREHOLDERS WHICH IS TO BE FILED
PURSUANT TO REGULATION 14A.
7
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
PART I
ITEM 1. BUSINESS.
Abrams Industries, Inc. engages in (i) construction of retail and
commercial projects; (ii) manufacturing store fixtures and display units for
retail outlets; and (iii) developing income-producing properties for
investment or sale, and providing management services for such properties.
The Company was organized under Delaware law in 1960 to succeed to
the business of A. R. Abrams, Inc., which was founded in 1925 by Alfred R.
Abrams as a sole proprietorship. In 1984, the Company changed its state of
incorporation to Georgia. As used herein, the term "Company" refers to Abrams
Industries, Inc. and its subsidiaries and predecessors, unless the context
indicates otherwise.
Financial information by industry segment is set forth in Note 10 to
the Consolidated Financial Statements of the Company.
CONSTRUCTION SEGMENT
The Company, through its wholly-owned subsidiary, Abrams
Construction, Inc., has engaged in the construction business since 1925.
Although the Company does work throughout much of the United States, it
concentrates its activities principally in the South. Construction activities
consist primarily of new construction of, expansion of, and remodeling of
retail store buildings, warehouses, banks, and shopping centers.
Construction contracts are obtained by competitive bid and by
negotiation. Generally, purchasing of materials and services for the
Company's construction operations is done on a project-by-project basis.
MANUFACTURING SEGMENT
The Company, through its wholly-owned subsidiary, Abrams Fixture
Corporation, has engaged in manufacturing and selling store fixtures since
1946, and has been designing and producing point-of-purchase and other
displays since 1975. The Company engineers and fabricates displays, check-out
counters, cabinets, tables and other store fixtures of wood, metal and
plastic laminate for sale primarily to several of the larger national retail
store chains. Substantially all the store fixtures are fabricated to meet the
customer's requirements for type, size, shape and color and are generally
produced against specific orders.
Abrams Fixture Corporation also produces both standardized and
custom-designed point-of-purchase display units which are sold to carpet and
wallcovering manufacturers, distributors, and retailers. Several types of
home furnishing displays are manufactured and sold under the marketing title
of Abrams International Merchandising Systems (AIMS).
The Company maintains raw material inventories of items such as
lumber, plywood, metals, particle board, laminates, and hardware. In the
opinion of management, the raw materials and supplies utilized by this
segment of the Company are available from numerous sources.
REAL ESTATE SEGMENT
The Company, through its wholly-owned subsidiary, Abrams Properties,
Inc., has engaged in real estate development activities since 1960. These
activities involve primarily the development of shopping centers in the
Southeast and Midwest. Development activities include selecting, optioning
and acquiring sites, preparing market studies, arranging construction
financing and long-term financing, contracting for design and construction,
negotiating leases and managing the property upon completion of construction.
Since 1973, the principal tenant of these developed shopping centers has been
Kmart Corporation. The Company develops properties for sale to others, for
fees and for its own investment purposes.
The Company developed and currently owns 12 shopping centers which
are held as long-term investments and were developed by the Company for that
purpose. See "ITEM 2. PROPERTIES - Owned Shopping Centers". At April 30,
1995, the Company also was lessee and manager of 10 Company-developed
shopping centers which were sold and leased back by the Company for
subleasing. See "ITEM 2. PROPERTIES - Leaseback Shopping Centers".
EMPLOYEES AND EMPLOYEE RELATIONS
At April 30, 1995, the Company employed 142 salaried employees, which
included administrative, professional, and executive personnel, 13 hourly
paid foremen, and 136 hourly employees.
The hourly employees at Abrams Fixture Corporation are represented by
one union. On May 1, 1992, the Company and the union reached a four-year
agreement concerning wages and benefits. The Company has no other union
agreements. On its construction jobs, the Company utilizes local labor
whenever practicable, paying the prevailing wage scale. The Company believes
that its relations with its employees are good.
8<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
SEASONAL NATURE OF BUSINESS
The Company's business has generally been seasonal, with the highest
revenues generally occurring in the second and fourth quarters of the
Company's fiscal year. This seasonal nature results primarily from the
businesses of the Construction Segment and the Manufacturing Segment, which,
in addition to weather factors, are affected by customers' desires generally
to build or remodel retail outlets so that work will be completed by the
spring or fall. The business of the Real Estate Segment is generally less
seasonal.
COMPETITION
The businesses of the Company are highly competitive. In its
construction work and store fixture and display manufacturing business, the
Company competes with a large number of national and local construction
companies and fixture manufacturers and suppliers, many of which have greater
financial resources than the Company. The Company also competes with smaller
specialized companies. The real estate development area is also extremely
competitive, with numerous companies competing for available financing,
sites, tenants and purchasers.
PRINCIPAL CUSTOMERS
During fiscal 1995, the Company derived approximately 43%
($52,708,000) of its consolidated revenues from direct transactions with The
Home Depot, Inc. These revenues resulted from construction activities and
sales of manufactured store fixtures. During fiscal 1995, the Company derived
approximately 16% ($18,942,000) of its consolidated revenues from
construction activities for Baby Superstore, Inc. Also, during fiscal 1995,
the Company derived approximately 11% ($13,737,000) of its consolidated
revenues from direct transactions with Kmart Corporation. These revenues
resulted from store rentals (approximately $7,020,000), construction
activities, and the sales of manufactured store fixtures. See "ITEM 2.
PROPERTIES" and Note 10 to the Consolidated Financial Statements of the
Company. No other single customer accounted for 10% or more of the Company's
consolidated revenues during the year.
BACKLOG
The following table indicates the backlog of contracts and orders by
industry segment:
<TABLE>
<CAPTION>
April 30, April 30,
1995 1994
--------------------------------------
<S> <C> <C>
Construction $34,284,000 $28,154,000
Manufacturing 7,300,000 6,178,000
Real Estate 10,083,000 10,763,000
---------------------------------------
Total Backlog $51,667,000 $45,095,000
========================================
</TABLE>
The Company estimates that most of the backlog at April 30, 1995 will
be completed prior to April 30, 1996. No assurance can be given as to future
backlog levels or whether the Company will realize earnings from the revenues
resulting from the backlog at April 30, 1995.
REGULATION
The Company is subject to the authority of various state and local
regulatory agencies concerned with the licensing of contractors, but it has
experienced no material difficulty in complying with such requirements. The
Company is also subject to local zoning regulations and building codes in
performing its construction and real estate activities. Management believes
that it is in substantial compliance with all such governmental regulations.
Management believes that compliance with federal, state and local provisions
which have been enacted or adopted for regulating the discharge of materials
into the environment does not have a material effect upon the capital
expenditures, earnings and competitive position of the Company.
9
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
EXECUTIVE OFFICERS OF THE REGISTRANT
The Executive Officers of the Company are as follows:
<TABLE>
<CAPTION>
Name and Age Positions with the Company Officer Since
- --------------------------------------------------------------------------------------------------------------------------------
<S> <S> <C>
Bernard W. Abrams (70) Chairman of the Board of Directors 1952
and Chief Executive Officer
Edward M. Abrams (68) Director, President and Treasurer 1953
Joseph H. Rubin (52) Director, Executive Vice President 1979
and Secretary
Alan R. Abrams (40) President, Abrams Properties, Inc. 1988
since 1994. Prior to that he served
as Vice President of Abrams Properties, Inc.
B. Michael Merritt (45) President, Abrams Construction, Inc. 1986
since May, 1995. Prior to that he served
as Executive Vice President of
Abrams Construction, Inc.
Richard V. Priegel (42) President, Abrams Fixture Corporation 1981
</TABLE>
Executive Officers of the Company are elected by the Board of
Directors of the Company or the Board of Directors of the respective
subsidiary to serve at the pleasure of the Board. Bernard W. Abrams and
Edward M. Abrams are brothers. Alan R. Abrams and J. Andrew Abrams, who serve
on the Board of Directors of the Company, are sons of Edward M. Abrams and
nephews of Bernard W. Abrams. There are no other family relationships between
any Executive Officer or Director and any other Executive Officer or Director
of the Company.
ITEM 2. PROPERTIES.
The Company leases executive offices containing approximately 18,000
square feet in the Lakeside Office Park, 5775-A Glenridge Drive, in suburban
Atlanta, Georgia. These offices are also used by the Company's Real Estate
Segment and Construction Segment.
The primary Manufacturing Segment facility contains approximately
255,000 square feet and is used for wood manufacturing and warehousing. There
is a separate metal fabrication and warehousing facility, containing
approximately 104,000 square feet. Both of these facilities are owned by the
Company. The Company also leases one facility containing approximately 60,000
square feet, in which 48,000 square feet are used for warehousing and 12,000
square feet are used for manufacturing. These properties are all located near
downtown Atlanta.
The Company also owns, or has an interest in, the following
properties:
OWNED SHOPPING CENTERS
The Company, through its Real Estate Segment, owns 12 shopping
centers which it developed. Except for the centers in Oakwood and Newnan,
Georgia, and Englewood and North Fort Myers, Florida, all are leased
exclusively to Kmart. Anchor lease terms for the other than exclusively Kmart
centers are shown in the table below.
<TABLE>
<CAPTION>
Lease Options Options
Anchor Square Expiration To To
Location Tenant Footage Date Renew Cancel (1)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <S> <C> <C> <C> <C>
Oakwood, GA A & P 44,664 2013 (4) 5 Year
- ------------------------------------------------------------------------------------------------------------------------------
Newnan, GA Goody's 24,986 1997 (2) 5 Year
Kmart 82,779 2017 (10) 5 Year
Kroger 49,319 2012 (6) 5 Year
- ------------------------------------------------------------------------------------------------------------------------------
Englewood, FL Beall's 31,255 2006 (4) 5 Year
Kmart 86,479 2015 (10) 5 Year
Publix 48,555 2010 (4) 5 Year
Walgreens 13,500 2040 (6) 5 Year
- ------------------------------------------------------------------------------------------------------------------------------
North Fort Myers, FL Beall's 35,600 2009 (9) 5 Year
Fashion Bug 9,600 2004 (4) 5 Year
Food Lion 33,000 2013 (4) 5 Year
Jo-Ann Fabrics 16,000 2003 (3) 5 Year
Kmart 107,806 2018 (10) 5 Year
- -----------------------------------------------------------------------------------------------------------------------------
(1) Walgreens' six five-year cancellation options commence in 2010.
</TABLE>
10<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
In the shopping centers leased solely to Kmart, the leases expire
from 1997 to 2017 and contain 8 to 10 five-year renewal options. With the
exception of the Kmart leases in Columbus and Warner Robins, Georgia; Niles,
Michigan; and Shawnee, Oklahoma; all of the anchor tenant leases provide for
contingent rentals if sales exceed specified amounts. Most major tenants have
rights to offset those contingent rentals against certain annual operating
expenses paid by them. In fiscal 1995, the Company received $64,037 in
contingent rentals, net of offsets, which are included in the aggregate
rentals set forth below.
Typically, tenants are responsible for their pro rata share of ad
valorem taxes, insurance and common area maintenance (subject to the right of
offset discussed above). With the exception of the centers in Morton,
Illinois; Warner Robins and Columbus, Georgia; Niles, Michigan; and Shawnee,
Oklahoma, where Kmart has complete maintenance responsibility, the Company
has responsibility for structural and roof maintenance of the buildings. The
Company also has responsibility for parking lots and driveways, except
routine upkeep, which is the responsibility of the tenants.
The following chart provides relevant information relating to the
owned shopping centers:
<TABLE>
<CAPTION>
===================================================================================================================================
Principal
Annual Amount of
Rents Cash Mortgage Mortgage Debt
Square Received: Flow: Payments: Outstanding
Feet In Year Fiscal Fiscal Fiscal As Of April 30,
Lcation Acres Building(s) Completed 1995 1995 (1) 1995 (2) 1995 (3)
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C> <C>
1100 W. Argyle Street 11.4 105,022 1972 $ 299,192 $ 273,449 $ 254,701 $ 609,740
Jackson, MI
- -----------------------------------------------------------------------------------------------------------------------------------
2707 S. 11th Street 11.7 105,155 1974, 1993 288,814 287,538 261,648 2,523,567
Niles, MI
- -----------------------------------------------------------------------------------------------------------------------------------
100 Virginia Avenue 9.7 84,686 1974, 1991 206,173 205,913 162,408 892,166
Tifton, GA
- -----------------------------------------------------------------------------------------------------------------------------------
44-56 Bullsboro Drive 16.3 174,059 1974, 1987, 851,296 833,467 668,042 5,812,678
Newnan, GA 1989
- -----------------------------------------------------------------------------------------------------------------------------------
2063 Watson Boulevard 12.1 104,224 1975 354,000 352,507 329,529 2,656,871
Warner Robins, GA
- -----------------------------------------------------------------------------------------------------------------------------------
2323-2327 N. Harrison 8.0 83,552 1979, 1991 385,893 384,511 358,453 2,912,783
Shawnee, OK
- -----------------------------------------------------------------------------------------------------------------------------------
315 Deo Drive 7.1 68,337 1979 240,500 238,122 204,404 1,525,000
Newark, OH
- -----------------------------------------------------------------------------------------------------------------------------------
1075 W. Jackson Street 7.3 92,120 1980, 1992 463,225 430,511 406,036 3,499,231
Morton, IL (4)
- -----------------------------------------------------------------------------------------------------------------------------------
2500 Airport Thruway 8.0 87,543 1980, 1988 441,286 400,408 392,169 3,315,702
Columbus, GA (4)
- -----------------------------------------------------------------------------------------------------------------------------------
3715 Mundy Mill Road 10.0 71,514 1988 719,162 688,097 482,290 4,736,899
Oakwood, GA
- -----------------------------------------------------------------------------------------------------------------------------------
1500 Placida Road 28.7 213,739 1990 1,577,397 1,542,243 1,352,167 13,186,617
Englewood, FL
- -----------------------------------------------------------------------------------------------------------------------------------
15201 N. Cleveland 72.3 226,735 1993 1,501,679 1,284,296 1,073,817 9,915,245
North Fort Myers, FL
===================================================================================================================================
(1) Annual cash flow is net operating income before depreciation, amortization of loan and lease costs, interest and
principal payments on mortgage notes and bonds payable.
(2) Includes principal and interest, but excludes mortgage refinancings and costs associated therewith.
(3) Exculpatory provisions limit the Company's liability to the respective mortgaged properties, except for
the North Fort Myers, Florida loan which has been guaranteed by Abrams Properties, Inc. See Notes 6 and 7
to the Consolidated Financial Statements of the Company.
(4) Land is leased, not owned. The Columbus, Georgia center is owned by Abrams/Columbus Limited Partnership,
in which Abrams Properties, Inc. serves as general partner and owns an 80% interest.
</TABLE>
11<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
LEASEBACK SHOPPING CENTERS
The Company, through its Real Estate Segment, is lessee of 10
shopping centers which it developed, sold and leased back under leases
expiring from years 2001 to 2014. The 10 centers are subleased by the Company
to Kmart Corporation for periods corresponding to the Company's leases. The
Kmart subleases provide for contingent rentals if sales exceed specified
amounts, and contain 10 five-year renewal options, except Jacksonville,
Florida, which has eight five-year renewal options. The Company's leases with
the fee owners contain renewal options coextensive with Kmart's renewal
options. Kmart is responsible for insurance and ad valorem taxes, but has the
right to offset against contingent rentals any such taxes paid in excess of
specified amounts. In fiscal 1995, the Company received $38,630 in contingent
rentals, net of offsets, which is included in the aggregate annual rentals
set forth below. The Company has responsibility for structural and roof
maintenance of the buildings. The Company also has responsibility for parking
lots and driveways, except routine upkeep, which is the responsibility of the
tenant, Kmart. The Company's leases contain exculpatory provisions which
limit the Company's liability to its interest in the respective subleases.
The following chart provides certain information relating to the
leaseback shopping centers:
<TABLE>
<CAPTION>
=================================================================================================================================
Rents Rent
Square Received: Expense:
Feet In Year Fiscal Fiscal
Location Acres Building(s) Completed 1995 1995
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Bayonet Point, FL 10.8 109,340 1976 $336,886 $269,568
- ---------------------------------------------------------------------------------------------------------------------------------
Orange Park, FL 9.4 84,180 1976 264,000 226,796
- ---------------------------------------------------------------------------------------------------------------------------------
Rock Island, IL 9.8 84,180 1976 297,600 268,786
- ---------------------------------------------------------------------------------------------------------------------------------
Davenport, IA 10.0 84,180 1977 267,052 208,153
- ---------------------------------------------------------------------------------------------------------------------------------
Minneapolis, MN 7.1 84,180 1978 342,920 230,570
- ---------------------------------------------------------------------------------------------------------------------------------
West St. Paul, MN 10.0 84,180 1978 298,465 229,630
- ---------------------------------------------------------------------------------------------------------------------------------
Ft. Smith, AR 9.2 106,141 1979 255,350 223,195
- ---------------------------------------------------------------------------------------------------------------------------------
Jacksonville, FL 11.6 97,032 1979 303,419 258,858
- ---------------------------------------------------------------------------------------------------------------------------------
Louisville, KY 9.3 72,897 1979 290,000 251,279
- ---------------------------------------------------------------------------------------------------------------------------------
Richfield, MN 5.7 74,217 1979 300,274 241,904
=================================================================================================================================
</TABLE>
<PAGE>
LAND HELD FOR INVESTMENT
The Company, through its Real Estate Segment, owns or has an interest
in the following undeveloped land held for investment:
<TABLE>
<CAPTION>
=============================================================================================================================
Year Intended
Location Acres Acquired Use (1)
- -----------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <S>
2707 S. 11th Street 2.9 1973 Food store and/or retail shops
Niles, MI
- ------------------------------------------------------------------------------------------------------------------------------
Kimberly Road & Fairmont Street 6.0 1977 Outlot, plus food store and/or retail
Davenport, IA
- ------------------------------------------------------------------------------------------------------------------------------
Dixie Highway 4.7 1979 Food store and/or retail shops
Louisville, KY
- ------------------------------------------------------------------------------------------------------------------------------
West 15th Street 1.4 1979 Two outlots (2)
Washington, NC
- ------------------------------------------------------------------------------------------------------------------------------
Mundy Mill Road 7.7 1987 Retail shops and/or five outlots
Oakwood, GA
- ------------------------------------------------------------------------------------------------------------------------------
Placida Road 0.7 1989 One outlot
Englewood, FL
- ------------------------------------------------------------------------------------------------------------------------------
North Cleveland Avenue 13.6 1993 Seven outlots and retail shops
North Fort Myers, FL
===============================================================================================================================
(1) "Outlot" as used herein refers to a small parcel of land reserved from the original shopping center
parcel and is generally sold for, leased for, or developed as, a fast-food operation, bank or similar use.
(2) Leased under leases terminating in years 2005 and 2010 with a right to extend for three additional five-year
periods. Both outlots are sub-leased for terms coextensive with the Company's lease.
</TABLE>
There is no mortgage debt on any of the properties, except for the
North Fort Myers, Florida retail shop land. See Note 7 to the Consolidated
Financial Statements of the Company. The Company will either develop the
properties described above or will hold them for sale to others.
12
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
ITEM 3. LEGAL PROCEEDINGS.
The Company is not a party to, nor is any of its property the subject
of, any material pending legal proceedings, other than ordinary routine
proceedings incidental to the business of the Company. To the knowledge of
the management of the Company, there are no material legal proceedings
contemplated or threatened against it.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER
MATTERS.
COMMON STOCK DATA
<TABLE>
<CAPTION>
=================================================================================================================================
DIVIDENDS PAID
CLOSING MARKET PRICES PER SHARE
- ---------------------------------------------------------------------------------------------------------------------------------
FISCAL FISCAL FISCAL FISCAL
1995 1994 1995 1994
- ---------------------------------------------------------------------------------------------------------------------------------
HIGH LOW HIGH LOW
<S> <C> <C> <C> <C> <C> <C>
First Quarter $6.250 $5.500 $6.000 $4.625 $.03 $.02
- ---------------------------------------------------------------------------------------------------------------------------------
Second Quarter 6.375 4.500 6.500 5.500 .03 .03
- ---------------------------------------------------------------------------------------------------------------------------------
Third Quarter 5.250 4.500 7.750 5.250 .03 .03
- ---------------------------------------------------------------------------------------------------------------------------------
Fourth Quarter 5.000 4.000 7.875 5.750 .03 .03
=================================================================================================================================
</TABLE>
The common stock of Abrams Industries, Inc. is traded
over-the-counter in the NASDAQ/National Market System (Symbol: ABRI). The
approximate number of holders of common stock was 528 (including shareholders
of record and shares held in street name) at May 31, 1995.
The following firms were listed as Abrams Industries, Inc. market
makers in the April 30, 1995, NASDAQ/NMS Monthly Statistical Report:
* The Chicago Corporation - Chicago, Illinois
* Herzog, Heine & Geduld - New York, New York
* Interstate/Johnson Lane, Corp. - Atlanta, Georgia
* Mackie, R.A. & Co., Inc. - Irvington, New York
* Robinson Humphrey Co., Inc. - Atlanta, Georgia
* Robotti & Eng - New York, New York
* Sherwood Securities - New York, New York
* T.R. Winston & Co., Inc. - Far Hills, New Jersey
* Troster Singer Corporation - Jersey City, New Jersey
13
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
ITEM 6. SELECTED FINANCIAL DATA.
The following table sets forth selected financial data for the
Company and should be read in conjunction with the consolidated financial
statements and notes thereto
<TABLE>
1995 1994 1993 1992 1991
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Consolidated Revenues $122,608,682 $123,602,954 $82,878,911 $83,818,090 $78,020,796
- ---------------------------------------------------------------------------------------------------------------------------------
Net Earnings (Loss) $ (331,019) $ 1,359,408 $ 1,710,381 $ 1,021,303 $ 1,027,373
- ---------------------------------------------------------------------------------------------------------------------------------
Net Earnings (Loss) Per Share* $ (.11) $ .46 $ .57 $ .34 $ .34
- ---------------------------------------------------------------------------------------------------------------------------------
Actual Shares Outstanding at Year-End 2,993,540 2,993,540 2,977,540 2,977,540 2,977,540
- ---------------------------------------------------------------------------------------------------------------------------------
Cash Dividends Paid Per Share $ .12 $ .11 $ .11 $ .20 $ .20
- ---------------------------------------------------------------------------------------------------------------------------------
Shareholders' Equity $ 20,872,035 $ 21,562,279 $20,484,880 $19,102,028 $18,676,233
- ---------------------------------------------------------------------------------------------------------------------------------
Shareholders' Equity Per Share* $ 6.97 $ 7.20 $ 6.84 $ 6.38 $ 6.24
- ---------------------------------------------------------------------------------------------------------------------------------
Working Capital $ 10,901,752 $ 9,445,073 $ 8,030,898 $ 2,783,427 $ 3,140,650
- ---------------------------------------------------------------------------------------------------------------------------------
Depreciation and Amortization Expense $ 3,078,878 $ 2,787,078 $ 2,162,472 $ 2,106,703 $ 1,938,687
- ---------------------------------------------------------------------------------------------------------------------------------
Total Assets $ 88,576,745 $ 92,732,567 $ 90,537,249 $78,260,810 $76,606,498
- ---------------------------------------------------------------------------------------------------------------------------------
Income-Producing Property Under
Development, Income-Producing
Properties and Property, Plant
and Equipment, net $ 55,065,157 $ 56,787,858 $64,340,348 $52,976,540 $49,999,625
- ---------------------------------------------------------------------------------------------------------------------------------
Long-Term Debt $ 51,580,229 $ 52,637,298 $55,197,178 $41,513,804 $39,104,720
- ---------------------------------------------------------------------------------------------------------------------------------
Return on Average Shareholders' Equity (1.6%) 6.5% 8.6% 5.4% 5.6%
- ---------------------------------------------------------------------------------------------------------------------------------
Return on Total Assets (.4%) 1.5% 1.9% 1.3% 1.3%
=================================================================================================================================
<CAPTION>
1990 1989 1988 1987 1986 1985
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Consolidated Revenues $54,887,568 $50,331,871 $51,032,736 $46,773,124 $45,962,053 $61,480,691
- -----------------------------------------------------------------------------------------------------------------------------
Net Earnings (Loss) $ 1,534,063 $ 1,435,567 $ 1,082,883 $ 969,326 $ 582,741 $ 1,232,331
- ----------------------------------------------------------------------------------------------------------------------------
Net Earnings (Loss Per Share)* $ .51 $ .48 $ .36 $ .33 $ .20 $ .41
- ----------------------------------------------------------------------------------------------------------------------------
Actual Shares Outstanding at Year-End 2,994,039 2,978,039 1,787,000 1,787,000 1,782,452 1,779,610
- ----------------------------------------------------------------------------------------------------------------------------
Cash Dividends Paid Per Share $ .20 $ .18 $ .14 $ .14 $ .14 $ .13
- ----------------------------------------------------------------------------------------------------------------------------
Shareholders' Equity $18,304,102 $17,310,146 $16,402,538 $15,748,535 $15,192,735 $15,028,358
- ----------------------------------------------------------------------------------------------------------------------------
Shareholders' Equity Per Share* $ 6.11 $ 5.78 $ 5.48 $ 5.26 $ 5.08 $ 5.02
- ----------------------------------------------------------------------------------------------------------------------------
Working Capital $21,575,826 $18,830,026 $12,955,259 $ 9,089,467 $11,092,309 $15,849,468
- ----------------------------------------------------------------------------------------------------------------------------
Depreciation and Amortization Expense $ 1,707,985 $ 1,668,105 $ 1,491,401 $ 1,364,970 $ 1,210,321 $ 1,173,564
- ----------------------------------------------------------------------------------------------------------------------------
Total Assets $64,047,108 $56,318,968 $51,178,946 $44,957,055 $43,361,213 $44,258,623
- ----------------------------------------------------------------------------------------------------------------------------
Income-Producing Property Under
Development, Income-Producing
Properties and Property, Plant
and Equipment, net $22,797,353 $24,088,285 $21,069,833 $17,058,000 $17,208,946 $15,820,514
- ----------------------------------------------------------------------------------------------------------------------------
Long-Term Debt $29,955,918 $30,071,322 $23,337,984 $19,387,624 $20,226,001 $17,982,297
- ----------------------------------------------------------------------------------------------------------------------------
Return on Average Shareholders' Equity 8.6% 8.5% 6.7% 6.3% 3.9% 8.4%
- ----------------------------------------------------------------------------------------------------------------------------
Return on Total Assets 2.4% 2.5% 2.1% 2.2% 1.3% 2.8%
=================================================================================================================================
*Adjusted to reflect stock dividends and stock splits.
</TABLE>
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS FOR FISCAL YEARS ENDED APRIL 30, 1995, 1994 AND 1993.
RESULTS OF OPERATIONS
REVENUES
Company Revenues for 1995 were $122,608,682, compared to $123,602,954
and $82,878,911 for 1994 and 1993, respectively. This represents a decrease
in REVENUES of 1% from those of 1994 and an increase in REVENUES of 48% from
those of 1993. The Company Revenues include Interest income of $406,302,
$307,220 and $217,797 for 1995, 1994 and 1993, respectively, and include
Other income of $53,495, $145,410 and $175,334 for 1995, 1994 and 1993,
respectively. The figures in Chart A below do not include Interest income,
Other income or Intersegment revenues. When more than one segment is
involved, REVENUES are reported by the segment that ultimately sells to the
purchaser outside the Company.
<TABLE>
<CAPTION>
REVENUE SUMMARY BY SEGMENT
(Dollars in Thousands)
CHART A
Years Ended Increase Years Ended Increase
April 30, (Decrease) April 30, (Decrease)
----------------------------------------------------------------------------------------------------------
1995 1994 Amount Percent 1995 1993 Amount Percent
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Construction (1) $ 94,040 $ 86,774 $ 7,266 8 $ 94,040 $ 54,742 $39,298 72
Manufacturing (2) 16,348 19,530 (3,182) (16) 16,348 16,518 (170) (1)
Real Estate (3) 11,761 16,846 (5,085) (30) 11,761 11,226 535 5
--------------------------------------- ------------------------------------
Total $122,149 $123,150 $ (1,001) (1) $122,149 $ 82,486 $39,663 48
======================================= ====================================
</TABLE>
14<PAGE>
<PAGE>
NOTES:
(1) The growth in revenues in 1995 from those in 1994 and 1993 is
the result of increased levels of activity in the construction of new
buildings and expansions of others for existing and new customers. The
amounts reported exclude $-0- in 1995, $1,020,000 in 1994, and $10,216,000 in
1993 related to construction work at a shopping center developed by the Real
Estate Segment.
(2) Sales to one of the Company's primary customers were $2,935,000
in 1995, compared to $5,396,000 in 1994 and $9,526,000 in 1993. These
decreases are attributable to that customer's reevaluation of its new store,
store expansion and remodeling programs. Sales of fixtures and displays to
other customers were $13,413,000 in 1995, compared to $14,134,000 in 1994 and
$6,992,000 in 1993.
(3) Rental revenues for 1995 were $11,131,000, compared to
$10,435,000 in 1994 and $9,255,000 in 1993. The increase is primarily
attributable to rents received from a Company-developed and owned shopping
center which opened during fiscal 1994. Revenues from sales of real estate
amounted to $630,000 in 1995, $6,411,000 in 1994, and $1,971,000 in 1993.
COSTS: APPLICABLE TO SEGMENT REVENUES
As a percentage of total Segment REVENUES (See Chart A), the
applicable total Segment COSTS (See Chart B) of $108,102,114 for 1995,
$105,259,598 for 1994 and $68,640,340 for 1993 were 89%, 85% and 83%,
respectively.
15
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
<TABLE>
COSTS APPLICABLE TO REVENUES SUMMARY BY SEGMENT
(Dollars in Thousands)
CHART B
<CAPTION>
Percent of
Segment Revenues
Years Ended For Years Ended
April 30, April 30,
-------------------------------------------------- --------------------------------
1995 1994 1993 1995 1994 1993
-------------------------------------------------- --------------------------------
<S> <C> <C> <C> <C> <C> <C>
Construction $88,847 $81,902 $50,742 94 94 93
Manufacturing (1) 12,896 12,773 11,227 79 65 68
Real Estate (2) 6,359 10,585 6,671 54 63 59
--------------------------------------------------
Total $108,102 $105,260 $68,640 89 85 83
==================================================
</TABLE>
NOTES:
(1) The percentage of Manufacturing Costs Applicable to Segment
REVENUES increased in 1995, as compared to both 1994 and 1993. The increase
is primarily attributable to (a) increased labor and material costs; (b) the
product mix of fixtures sold; (c) underabsorption of plant overhead; and (d)
increased aged inventory reserves. The underabsorption of plant overhead in
1995 amounted to approximately $900,000. The increase in inventory reserves
in 1995 amounted to approximately $288,000. These costs were not able to be
offset because of lower sales.
(2) The decrease in both the dollar and percentage of Real Estate
Costs Applicable to REVENUES is primarily attributable to the cost of real
estate sold that amounted to $313,000 in 1995, $5,249,000 in 1994, and
$1,781,000 in 1993.
SELLING, SHIPPING, GENERAL AND ADMINISTRATIVE EXPENSES BY SEGMENT
For the years 1995, 1994 and 1993, Selling, Shipping, General and
Administrative Expenses (See Chart C) were $10,207,016, $11,509,660 and
$9,571,435, respectively. As a percentage of Consolidated Revenues, these
expenses were 8% for 1995, 9% for 1994 and 12% for 1993. In reviewing Chart
C, the reader should recognize that the volume of revenues usually affects
these amounts and percentages. The percentages in Chart C are based on
expenses as they relate to segment revenues in Chart A, except that parent
expenses and total expenses relate to Consolidated Revenues.
<TABLE>
SELLING, SHIPPING, GENERAL AND ADMINISTRATIVE EXPENSES BY SEGMENT
(Dollars in Thousands)
CHART C
<CAPTION>
Percent of
Segment Revenues
Years Ended For Years Ended
April 30, April 30,
---------------------------------------------------- ---------------------------------------
1995 1994 1993 1995 1994 1993
---------------------------------------------------- ---------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Construction (1) $ 2,727 $ 2,637 $2,169 3 3 4
Manufacturing (2) 3,824 5,004 3,877 23 26 23
Real Estate (3) 1,629 1,873 1,755 14 11 16
Parent (4) 2,027 1,996 1,770 2 2 2
----------------------------------------------------
Total $ 10,207 $11,510 $9,571 8 9 12
====================================================
</TABLE>
NOTES:
(1) On a dollar basis comparison, Selling, Shipping, General and
Administrative Expenses were higher in 1995 as compared to 1994 and 1993.
This increase is attributable to new projects estimating expenses.
(2) On both a dollar and percentage basis comparison, Selling,
Shipping, General and Administrative Expenses were lower in 1995 as compared
to 1994, because of decreased incentive plan expenses, which are based on
segment profits.
(3) On a dollar basis comparison, the Selling, Shipping, General and
Administrative Expenses were lower in 1995 as compared to 1994 and 1993. The
decrease is attributable to no shopping center opening expenses incurred in
1995 ($166,000 in 1994); and decreased incentive plan expenses ($85,000 less
than 1994), which are based on segment profits.
(4) On a dollar basis comparison, Selling, Shipping, General and
Administrative Expenses were higher in 1995 as compared to 1994 and 1993,
because of increased personnel costs.
16
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
INTEREST COSTS
The majority of interest costs expensed of $4,806,571, $4,598,288 and
$2,642,043 in 1995, 1994 and 1993, respectively, are related to the ownership
of shopping centers and utilization of lines of credit. Interest costs of
$-0-, $536,000 and $1,920,000 relating to properties under development in
1995, 1994 and 1993, respectively, were capitalized.
LIQUIDITY AND CAPITAL RESOURCES
Except for certain real estate construction loans and occasional
short-term loans, the Company normally has been able to finance its working
capital needs through funds generated internally. If funds are not generated
through normal operations, the Company has available bank lines of credit.
The Company has also developed relationships with various banks through which
other short-term and long-term financing could be available if required.
Working capital increased to $10,901,752 at the end of 1995, as compared to
$9,445,073 and $8,030,898 of working capital at the end of 1994 and 1993,
respectively. Operating activities provided cash of $3,134,826. Investing
activities used cash of $484,794 primarily for purchasing new equipment and
computers to increase productivity. Financing activities used cash of
$1,506,517 primarily for debt repayment.
In April 1992, the Company secured a construction loan for the North
Fort Myers development from Trust Company Bank of Atlanta, Georgia. The loan
was modified during April 1994. The term of the construction financing is
five years, and the loan may be extended for one additional year upon the
satisfaction of certain conditions. The maximum amount to be funded will be
determined by a formula based on future development. The Company entered into
an interest rate swap agreement with Trust Company Bank effective January 4,
1994, and which terminates July 1, 1997. The notional amount reduces monthly
from approximately $10 million at April 30, 1995, to $9.5 million prior to
expiration of the agreement. The agreement effectively sets a cap and floor
interest rate of 8% and 6%, respectively, on the construction loan which had
an outstanding balance of $9,915,245 at April 30, 1995, and carries a
floating interest rate of prime plus 3/8%. The Company expects the
counterparty to the agreement to abide by the terms of the agreement. A
determination is made each reporting period whether amounts are receivable
from or payable to the counterparty under the agreement and such accrual is
made in the Company's financial statements.
At April 30, 1995, the Company and its subsidiaries had bank lines of
credit of $13,000,000, of which $361,000 was outstanding.
EFFECTS OF INFLATION ON REVENUES AND OPERATING PROFITS
The effects of inflation upon the Company's operating results are
varied. Except for the current year, inflation in the past three years has
been modest and has had minimal effect on the Company. The Construction
Segment subcontracts most of its work at fixed prices, which normally will
help that segment to protect its profit margin percentage.
During the current year the Manufacturing Segment experienced
increased costs, especially in the area of wood and wood products. As a
result, profit margins have decreased. This segment is now noticing a
stabilizing in raw materials prices.
In the Real Estate Segment, the majority of leases are long-term
(over 20 years) with fixed rents except for contingent rent provisions by
which the Company may earn additional rent as a result of increases in
tenants' sales. The contingent rent provisions, however, permit the tenant in
most cases to offset against contingent rents any increases in ad valorem
taxes over a specified amount. If inflation were to rise, ad valorem taxes
would probably increase which, in turn, would cause a decrease in the continge
nt rents. Furthermore, the Company has certain repair obligations and the
costs of repairs increase with inflation.
Inflation causes a rise in interest rates, which has a positive
effect on investment income, but has a negative effect on profit margins
because of the increased costs of production. Overall, inflation will tend to
limit the Company's markets and, in turn, will reduce revenues as well as
operating profits.
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
<TABLE>
<S> <C>
Page
Independent Auditors' Report 18
Consolidated Balance Sheets - April 30, 1995 and 1994 19
Consolidated Statements of Operations - For the years ended April 30, 1995, 1994 and 1993 20
Consolidated Statements of Shareholders' Equity - For the years ended April 30, 1995, 1994 and 1993 21
Consolidated Statements of Cash Flow - For the years ended April 30, 1995, 1994 and 1993 22
Notes to Consolidated Financial Statements - April 30, 1995, 1994 and 1993 23-30
Schedules:
SCHEDULE NUMBER
---------------
II Valuation and Qualifiying Accounts 31
III Real Estate and Accumulated Depreciation 32-33
</TABLE>
17
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Shareholders
Abrams Industries, Inc.
We have audited the consolidated financial statements of Abrams
Industries, Inc. and subsidiaries as listed in the accompanying index. In
connection with our audits of the consolidated financial statements, we also
have audited the financial statement schedules as listed in the accompanying
index. These consolidated financial statements and financial statement
schedules are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements and financial statement schedules based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit also includes assessing the
accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to
above present fairly, in all material respects, the financial position of
Abrams Industries, Inc. and subsidiaries as of April 30, 1995 and 1994, and
the results of their operations and cash flows for each of the years in the
three-year period ended April 30, 1995, in conformity with generally accepted
accounting principles. Also in our opinion, the related financial statement
schedules, when considered in relation to the basic consolidated financial
statements taken as a whole, present fairly, in all material respects, the
information set forth therein.
As discussed in Note 8 to the consolidated financial statements, the
Company adopted the provisions of the Financial Accounting Standards Board's
Statement of Financial Accounting Standards No. 109, ACCOUNTING FOR INCOME
TAXES, in 1993.
/s/ KPMG Peat Marwick
June 9, 1995
Atlanta, Georgia
18
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
April 30,
------------------------------------------
1995 1994
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 8,270,703 $ 7,127,188
Receivables-
Trade notes and accounts, net 2,281,440 3,699,176
Contracts, net, including retained amounts of
$3,054,467 in 1995 and $3,065,516 in 1994 8,401,281 10,350,991
Inventories (Note 2) 2,655,906 2,362,231
Costs and earnings in excess of billings (Note 3) 1,568,845 1,489,344
Deferred income taxes (Note 8) 1,212,791 754,625
Other 388,079 372,639
- -------------------------------------------------------------------------------------------------------------------------------
Total current assets 24,779,045 26,156,194
- -------------------------------------------------------------------------------------------------------------------------------
INCOME-PRODUCING PROPERTIES (Notes 4, 6 and 7) 50,784,045 52,745,604
PROPERTY, PLANT AND EQUIPMENT (Notes 5 and 7) 4,281,112 4,042,254
OTHER ASSETS:
Land held for investment 4,950,293 5,231,272
Notes receivable 783,293 1,405,000
Cash surrender value of life insurance on officers, net 889,712 820,554
Deferred loan costs, net 1,128,040 1,334,697
Other 981,205 996,992
- -------------------------------------------------------------------------------------------------------------------------------
$ 88,576,745 $92,732,567
===============================================================================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Trade and subcontractors payables, including
retained amounts of $1,249,840 in 1995 and
$1,440,000 in 1994 $ 7,859,614 $ 8,368,374
Billings in excess of costs and earnings (Note 3) 500,468 699,558
Accrued cash and deferred profit-sharing (Note 9) 1,493,481 2,702,113
Accrued expenses 2,553,271 2,580,239
Current maturities of long-term debt (Notes 6 and 7) 1,510,122 1,595,572
Income taxes payable (Note 8) -- 765,265
- --------------------------------------------------------------------------------------------------------------------------------
Total current liabilities 13,916,956 16,711,121
- ---------------------------------------------------------------------------------------------------------------------------------
DEFERRED INCOME TAXES (Note 8) 2,207,525 1,821,869
MORTGAGE NOTES AND BONDS PAYABLE, less
current maturities (Note 6) 40,518,332 41,704,344
OTHER LONG-TERM DEBT, less current maturities (Note 7) 11,061,897 10,932,954
- --------------------------------------------------------------------------------------------------------------------------------
Total liabilities 67,704,710 71,170,288
- --------------------------------------------------------------------------------------------------------------------------------
COMMITMENTS AND CONTINGENCIES (Notes 6 and 7)
SHAREHOLDERS' EQUITY (Note 9):
Common stock, $1 par value; authorized
5,000,000 shares; 3,010,039 issued and
2,993,540 outstanding 3,010,039 3,010,039
Additional paid-in capital 2,012,190 2,012,190
Retained earnings 15,906,239 16,596,483
- --------------------------------------------------------------------------------------------------------------------------------
Total paid-in capital and retained earnings 20,928,468 21,618,712
Less cost of treasury stock (16,499 shares) 56,433 56,433
- --------------------------------------------------------------------------------------------------------------------------------
Total shareholders' equity 20,872,035 21,562,279
- ---------------------------------------------------------------------------------------------------------------------------------
$88,576,745 $92,732,567
=================================================================================================================================
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
</TABLE>
19
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Years Ended April 30,
- ----------------------------------------------------------------------------------------------------------------------------------
1995 1994 1993
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
REVENUES
Construction $ 94,039,455 $ 86,773,819 $54,742,242
Manufacturing 16,348,294 19,530,240 16,517,697
Rental income 11,131,136 10,435,407 9,254,641
Real estate sales 630,000 6,410,858 1,971,200
Interest 406,302 307,220 217,797
Other 53,495 145,410 175,334
- ----------------------------------------------------------------------------------------------------------------------------------
122,608,682 123,602,954 82,878,911
- ----------------------------------------------------------------------------------------------------------------------------------
COSTS AND EXPENSES
Applicable to revenues -
Construction 88,847,494 81,901,979 50,741,843
Manufacturing 12,895,856 12,772,836 11,227,153
Rental property operating
expenses, exclusive of interest 6,046,094 5,335,651 4,890,530
Cost of real estate sold 312,670 5,249,132 1,780,814
- ------------------------------------------------------------------------------------------------------------------------------
108,102,114 105,259,598 68,640,340
- ------------------------------------------------------------------------------------------------------------------------------
Selling, shipping, general and administrative 10,207,016 11,509,660 9,571,435
Interest costs incurred, less interest capitalized
of $536,000 and $1,920,000 in 1994 and 1993,
respectively 4,806,571 4,598,288 2,642,043
- ------------------------------------------------------------------------------------------------------------------------------
123,115,701 121,367,546 80,853,818
- ------------------------------------------------------------------------------------------------------------------------------
EARNINGS (LOSS) BEFORE INCOME TAXES AND CUMULATIVE
EFFECT OF CHANGE IN METHOD OF ACCOUNTING
FOR INCOME TAXES (507,019) 2,235,408 2,025,093
- ------------------------------------------------------------------------------------------------------------------------------
INCOME TAXES (Note 8)
Current (103,490) 1,033,846 550,285
Deferred (72,510) (157,846) 200,715
- -------------------------------------------------------------------------------------------------------------------------------
(176,000) 876,000 751,000
- -------------------------------------------------------------------------------------------------------------------------------
Earnings (loss) before cumulative effect of
change in method of accounting for income taxes (331,019) 1,359,408 1,274,093
Cumulative effect of change in method of
accounting for income taxes (Note 8) -- -- 436,288
- -------------------------------------------------------------------------------------------------------------------------------
NET EARNINGS (LOSS) $ (331,019) $ 1,359,408 $ 1,710,381
===============================================================================================================================
NET EARNINGS (LOSS) PER SHARE, based on weighted average
outstanding shares of 2,993,540, 2,981,762 and
2,977,540 in 1995, 1994 and 1993, respectively:
Net earnings (loss) before cumulative effect of change in
method of accounting for income taxes $ (.11) $ .46 $ .42
Cumulative effect per share of change in method of
accounting for income taxes (Note 8) -- -- $ .15
- --------------------------------------------------------------------------------------------------------------------------------
NET EARNINGS (LOSS) PER SHARE $ (.11) $ .46 $ .57
=================================================================================================================================
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
</TABLE>
20
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
<TABLE>
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
<CAPTION>
Common Stock Additional
----------------------- Paid-In Retained Treasury
Shares Amount Capital Earnings Stock Total
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
BALANCES at April 30, 1992 2,994,039 $2,994,039 $ 1,982,190 $14,182,232 $ (56,433) $19,102,028
Net earnings -- -- -- 1,710,381 -- 1,710,381
Cash dividends declared -
$.11 per share -- -- -- (327,529) -- (327,529)
- -----------------------------------------------------------------------------------------------------------------------------------
BALANCES at April 30, 1993 2,994,039 2,994,039 1,982,190 15,565,084 (56,433) 20,484,880
Net earnings -- -- -- 1,359,408 -- 1,359,408
Cash dividends declared -
$.11 per share -- -- -- (328,009) -- (328,009)
Proceeds from exercise of
stock options 16,000 16,000 30,000 -- -- 46,000
- -----------------------------------------------------------------------------------------------------------------------------------
BALANCES at April 30, 1994 3,010,039 3,010,039 2,012,190 16,596,483 (56,433) 21,562,279
Net loss -- -- -- (331,019) -- (331,019)
Cash dividends declared -
$.12 per share -- -- -- (359,225) -- (359,225)
===================================================================================================================================
BALANCES at April 30, 1995 3,010,039 $3,010,039 $ 2,012,190 $15,906,239 $ (56,433) $20,872,035
===================================================================================================================================
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
</TABLE>
21
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOW
<TABLE>
<CAPTION>
Years Ended April 30,
----------------------------------------------------------
1995 1994 1993
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net earnings (loss) $ (331,019) $ 1,359,408 $1,710,381
Adjustments to reconcile net earnings (loss) to net
cash provided by (used in) operating activities:
Depreciation and amortization 3,078,878 2,787,078 2,162,472
Deferred tax expense (benefit) (72,510) (157,846) 200,715
Cumulative effect of change in method of
accounting for income taxes -- -- (436,288)
Gain on sales of real estate (317,330) (1,161,726) (190,385)
Decrease (increase) in assets:
Receivables 3,367,446 (4,101,502) (298,453)
Inventories (293,675) (139,250) 2,076,458
Costs and earnings in excess of billings (79,501) (789,048) 219,500
Other current assets (15,440) 51,065 48,031
Other assets 506,692 (1,581,143) 603,500
Increase (decrease) in liabilities:
Accounts payable (508,760) 1,717,055 1,213,510
Accrued cash and deferred profit-sharing (1,208,632) 969,465 100,313
Billings in excess of costs and earnings (199,090) (242,358) 275,888
Accrued expenses (26,968) 341,740 (1,087,572)
Income taxes payable (765,265) 469,956 (280,695)
- -----------------------------------------------------------------------------------------------------------------------------------
Net cash provided by (used in) operating activities 3,134,826 (477,106) 6,317,375
- -----------------------------------------------------------------------------------------------------------------------------------
Cash flows from investing activities:
Proceeds from sales of real estate 630,000 6,410,858 1,971,200
Additions to properties, property, plant and
equipment, net (1,114,794) (2,696,947) (13,947,100)
- ------------------------------------------------------------------------------------------------------------------------------------
Net cash provided by (used in) investing activities (484,794) 3,713,911 (11,975,900)
- ------------------------------------------------------------------------------------------------------------------------------------
Cash flows from financing activities:
Debt proceeds 5,951,000 10,512,657 26,261,046
Debt repayments (7,093,519) (12,516,829) (15,319,886)
Additions to deferred loan costs (4,773) (727,697) (149,423)
Cash dividends (359,225) (328,009) (327,529)
Proceeds from exercise of stock options -- 46,000 --
- ------------------------------------------------------------------------------------------------------------------------------------
Net cash provided by (used in) financing activities (1,506,517) (3,013,878) 10,464,208
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase in cash and cash equivalents 1,143,515 222,927 4,805,683
Cash and cash equivalents at beginning of year 7,127,188 6,904,261 2,098,578
- -----------------------------------------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of year $ 8,270,703 $ 7,127,188 $ 6,904,261
===================================================================================================================================
Supplemental schedule of cash flow information:
Interest paid, net of amount capitalized $ 4,756,176 $ 4,922,260 $ 2,608,325
===================================================================================================================================
Income taxes paid $ 696,712 $ 734,663 $ 941,541
===================================================================================================================================
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
</TABLE>
22
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
April 30, 1995, 1994 and 1993
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(A) PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION
The consolidated financial statements include the accounts of
Abrams Industries, Inc., its wholly-owned subsidiaries and its 80%
investment in Abrams-Columbus Limited Partnership (Company). All
significant intercompany balances, transactions and profits have
been eliminated in consolidation. Revenues and costs are reported
by the segment which is the ultimate seller to an outside party.
(B) CASH EQUIVALENTS
Cash equivalents of $7,913,434 and $6,542,297 at April 30, 1995
and 1994, respectively, consist of certificates of deposit and other
financial instruments. For purposes of the statements of cash flows,
the Company considers all highly liquid debt instruments with original
maturities of three months or less to be cash equivalents.
(C) CAPITALIZATION POLICIES
The Company capitalizes interest and other carrying costs on
development properties and income-producing properties while they
are under construction or development. Costs of planning, development
and construction are also capitalized. Capitalization of interest and
other carrying costs is discontinued when a project is substantially
completed or if active development ceases.
(D) DEVELOPMENT AND INVESTMENT PROPERTIES
Development and investment properties are carried at the lower
of cost or estimated net realizable value. Management monitors
each property on a periodic basis. Valuation allowances for estimated
losses on development and investment properties are provided when a
significant and permanent decline in value occurs.
(E) INCOME RECOGNITION
Construction revenues and costs are reported on the
percentage-of-completion method, using costs incurred to date in
relation to estimated total costs of the contracts to measure the
stage of completion. The cumulative effects of changes in estimated
total contract costs and revenues are recorded in the period in which
the facts requiring the revisions become known. At the time it is
determined that a contract will result in a loss, the entire estimated
loss is recorded.
Revenues from the sales of real estate are recognized at the time
of closing. When a portion or unit of a development property is
sold, a proportionate share of the projected total cost of the
development is charged to cost of sales. Costs of sales related
to real estate are based on the specific property sold.
(F) INVENTORIES
Inventories are valued at the lower of cost (first-in,
first-out method) or market. To reflect the inventory at the lower
of cost or market, valuation reserves are established. Management
periodically evaluates the adequacy of the reserves based on aging,
sales and other relevant factors.
(G) INCOME-PRODUCING PROPERTIES AND PROPERTY, PLANT AND EQUIPMENT
Income-producing properties and property, plant and equipment
are recorded at cost and are depreciated and amortized for financial
reporting purposes using the straight-line method over the estimated
useful lives of the assets. Significant additions which extend asset
lives are capitalized. Normal maintenance and repair costs are expensed
as incurred.
(H) INCOME TAXES
In February 1992, the Financial Accounting Standards Board
issued Statement of Financial Accounting Standards No. 109,
Accounting for Income Taxes (Statement 109). Statement 109
requires a change from the deferred method of accounting for income
taxes of APB Opinion 11 to the asset and liability method of accounting
for income taxes. Under the asset and liability method of Statement 109,
deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective
tax bases. Deferred tax assets and liabilities are measured using
enacted tax rates expected to apply to taxable income in the years
in which those temporary differences are expected to be recovered
or settled. Under Statement 109, the effect on deferred tax assets
and liabilities of a change in tax rates is recognized in income in the
period that includes the enactment date.
23
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
Effective May 1, 1992, the Company adopted Statement 109 and
has reported the cumulative effect of that change in the method
of accounting for income taxes in the 1993 consolidated statement
of earnings.
(I) RECENT ACCOUNTING PRONOUNCEMENTS
The Company currently provides no benefits to former employees
after employment but before retirement, and therefore, Statement of
Financial Accounting Standard No. 112, Employers' Accounting for
Post-Employment Benefits, has no effect on the Company.
In December 1992, the Financial Accounting Standards Board
issued Statement of Financial Accounting Standards No. 107
(Statement 107), Disclosures About Fair Value of Financial Instruments,
which require all entities to disclose the fair value of financial
instruments, both assets and liabilities recognized and not recognized
in the statement of financial position, for which it is practicable to
estimate fair value. The provisions of Statement 107 are currently not
effective for financial statements issued by the Company until fiscal
years ending after December 15, 1995.
(J) EARNINGS PER SHARE
Earnings per share are computed by dividing net earnings by the
weighted average number of shares of common stock outstanding
during the year. Shares issuable in connection with the Company's
stock plans are not included in average outstanding shares. No
material dilution in earnings per share would result if all the
options were exercised.
(K) RECLASSIFICATIONS
Certain reclassifications have been made to the 1994 and 1993
consolidated financial statements to conform with classifications
adopted in 1995.
(2) INVENTORIES
The classes of inventory at April 30 were:
<TABLE>
<CAPTION>
1995 1994
---------------------------
<S> <C> <C>
Finished goods $ 1,790,849 $1,270,903
Work in progress 552,803 479,631
Raw materials 312,254 611,697
---------------------------
$ 2,655,906 $2,362,231
===========================
</TABLE>
(3) CONTRACTS IN PROGRESS
Assets and liabilities related to contracts in progress are included in
current assets and current liabilities as they will be liquidated in the
normal course of contract completion, although this may require more than one
year. Amounts billed and costs recognized on contracts in progress at April
30 were:
<TABLE>
<CAPTION>
1995 1994
---------------------------
<S> <C> <C>
Costs and earnings in excess of billings:
Accumulated costs and earnings $17,337,720 $28,908,876
Amounts billed 15,768,875 27,419,532
---------------------------
$ 1,568,845 $ 1,489,344
===========================
Billings in excess of costs and earnings:
Amounts billed $24,873,830 $10,540,528
Accumulated costs and earnings 24,373,362 9,840,970
---------------------------
$ 500,468 $ 699,558
===========================
</TABLE>
24
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
(4) INCOME-PRODUCING PROPERTIES
Substantially all income-producing properties are pledged as collateral
against mortgage notes and bonds payable. Income-producing properties and
their estimated useful lives at April 30 were:
<TABLE>
<CAPTION>
Estimated
useful lives 1995 1994
---------------------------------------------------------------------
<S> <C> <C> <C>
Land $14,832,628 $14,832,628
Buildings and
improvements 23 - 31.5 years 53,984,904 53,863,653
--------------------------------------
68,817,532 68,696,281
Less - Accumulated
depreciation
and amortization 18,033,487 15,950,677
--------------------------------------
$50,784,045 $52,745,604
======================================
</TABLE>
(5) PROPERTY, PLANT AND EQUIPMENT
The major components of property, plant and equipment and their estimated
useful lives at April 30 were:
<TABLE>
<CAPTION>
Estimated
useful lives 1995 1994
------------------------------------------------------------------
<S> <C> <C> <C>
Land $ 529,224 $ 529,224
Buildings and
improvements 3 - 31.5 years 4,805,509 4,706,750
Machinery and
equipment 3 - 10 years 5,542,580 4,982,075
--------------------------------------
10,877,313 10,218,049
Less - Accumulated
depreciation 6,596,201 6,175,795
--------------------------------------
$ 4,281,112 $ 4,042,254
======================================
</TABLE>
(6) MORTGAGE NOTES AND BONDS PAYABLE AND LEASES
The Company owns 12 shopping centers which are pledged as collateral on
related mortgage notes and bonds payable. It is also lessee of 10 shopping
centers under sale/leaseback arrangements expiring from 2001 to 2014. Each
note, bond and sale/leaseback arrangement contains an exculpatory provision
which limits the Company's liability to its interest in the mortgaged
property or lease, except for one note which has been guaranteed by a
subsidiary of the Company.
Both types of centers are primarily leased to the same tenant. The owned
centers are leased for periods expiring from 1997 to 2018 and the leased
centers for periods corresponding to the leaseback period. All leases are
operating leases. The leases typically require that the tenant make fixed
rental payments over a 23 - 25 year period and provide for renewal options
and for contingent rentals if the tenants' sales volumes exceed predetermined
amounts. In some cases, the leases provide that the tenant bear the cost of
insurance, repairs, maintenance and taxes. Base rental revenue received from
owned centers in 1995, 1994 and 1993 was approximately $7,261,000, $6,891,000
and $5,647,000, respectively. Base rental revenue received from
sale/leaseback centers in 1995, 1994 and 1993 was approximately $2,917,000,
$2,917,000 and $3,082,000, respectively. Contingent rentals received on all
centers in 1995, 1994 and 1993 were approximately $103,000, $94,000 and
$125,000, respectively.
25
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
Approximate future minimum annual rentals to be received on all centers are:
<TABLE>
<CAPTION>
Owned Leaseback
------------------------------------
Years Ending April 30, Rental Receipts
- ----------------------------------------------------------------------------------------------------
<C> <C> <C>
1996 $7,150,000 $2,917,000
1997 6,989,000 2,917,000
1998 6,854,000 2,917,000
1999 6,634,000 2,917,000
2000 6,417,000 2,850,000
2001 and thereafter 82,597,000 8,649,000
- ----------------------------------------------------------------------------------------------------
$116,641,000 $23,167,000
====================================================================================================
</TABLE>
Pertinent information on future payments on mortgage notes and bonds on owned
centers and approximate minimum rentals to be paid on leaseback centers are
as follows:
<TABLE>
<CAPTION>
Owned Centers Leaseback
Mortgage Payments Centers
-------------------------------- Rental
Years Ending April 30, Principal Interest Payments
- -----------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C>
1996 $ 1,153,000 $ 3,727,000 $2,405,000
1997 1,252,000 3,625,000 2,405,000
1998 1,279,000 3,516,000 2,405,000
1999 1,215,000 3,411,000 2,405,000
2000 1,315,000 3,302,000 2,405,000
2001 and thereafter 35,457,000 17,925,000 7,420,000
- -----------------------------------------------------------------------------------------------------------------------
$41,671,000 $35,506,000 $19,445,000
=======================================================================================================================
</TABLE>
The notes and bonds are due at various dates between January 1, 1998 and
April 1, 2017, and bear interest at rates ranging from 7.3% to 10%, with a
weighted average rate of 9.0% at April 30, 1995.
(7) OTHER LONG-TERM DEBT AND CREDIT FACILITIES
Other long term debt at April 30 was:
<TABLE>
<CAPTION>
1995 1994
----------------------------
<C> <C> <C>
79% of prime rate (7.11% at April 30, 1995), industrial
development bond payable in quarterly installments
of $57,143 principal plus interest, final payment due
March 1, 2000; secured by real property $ 1,142,852 $ 1,371,424
Prime rate plus 3/8% (9.375% at April 30, 1995), construction
mortgage loan; monthly principal and interest payments
of $87,729 required with principal due April 28, 1997
with an option for a one year extension; secured by
income-producing property and assignment of leases
and rents; a subsidiary of the Company has guaranteed
the outstanding amount of the construction mortgage loan 9,915,245 10,132,102
Prime rate (9% at April 30, 1995), $3,000,000 unsecured bank
line of credit; quarterly interest payments required with
principal due October 31, 1996 361,000 --
-----------------------------
Total other long-term debt 11,419,097 11,503,526
Less - Current maturities 357,200 570,572
-----------------------------
Total other long-term debt,
excluding current maturities $11,061,897 $10,932,954
=============================
</TABLE>
26
<PAGE>
ABRAMS INDUSTRIES, INC.
The aggregate maturities of other long-term debt are as follows:
<TABLE>
<CAPTION>
Years Ending April 30, Amount
--------------------------------------------------------------------------------------------------
<C> <C>
1996 $ 357,200
1997 10,376,189
1998 228,572
1999 228,572
2000 228,564
--------------------------------------------------------------------------------------------------
$11,419,097
==================================================================================================
</TABLE>
The Company entered into an interest rate swap agreement with the lender of
the construction mortgage loan effective January 4, 1994, and which
terminates July 1, 1997. The notional amount reduces monthly from
approximately $10 million at April 30, 1995, to $9.5 million prior to
expiration of the agreement. The agreement effectively sets a cap and floor
interest rate of 8% and 6%, respectively.
At April 30, 1995, the Company had available bank lines of credit of
$13,000,000, of which $361,000 was outstanding. These lines of credit which
expire during fiscal years 1996 and 1997 bear interest at the prime rate (9%
at April 30, 1995) and have a 3/8% commitment fee on the unused portion.
(8) INCOME TAXES
As discussed in Note 1, the Company adopted Statement 109 as of May 1, 1992.
The cumulative effect of this change in accounting for income taxes of
$436,288 was determined as of May 1, 1992 and was reported separately in the
statement of earnings for the year ended April 30, 1993.
<TABLE>
<CAPTION>
Income tax expense (benefit) consists of:
Current Deferred Total
-------------------------------------------------
<S> <C> <C> <C>
Year ended April 30, 1995:
U.S. federal $ (98,786) $ (58,681) $(157,467)
State and local (4,704) (13,829) (18,533)
-------------------------------------------------
$ (103,490) $ (72,510) $(176,000)
Year ended April 30, 1994:
U.S. federal $ 925,020 $(141,231) $ 783,789
State and local 108,826 (16,615) 92,211
------------------------------------------------
$1,033,846 $(157,846) $ 876,000
=================================================
Year ended April 30, 1993:
U.S. federal $ 492,360 $ 179,587 $ 671,947
State and local 57,925 21,128 79,053
$ 550,285 $ 200,715 $ 751,000
=================================================
</TABLE>
Income tax expense (benefit) was $(176,000), $876,000, and $751,000 for the
years ended April 30, 1995, 1994 and 1993, respectively, and differed from
the amounts computed by applying the U.S. federal income tax rate of 34
percent to pretax income from continuing operations as a result of the
following:
<TABLE>
<CAPTION>
1995 1994 1993
-------------------------------------------
<S> <C> <C> <C>
Computed "expected" tax expense (benefit) $(172,386) $760,039 $688,531
Increase in income taxes resulting from:
State and local income taxes, net
of federal income tax benefit (12,232) 60,859 52,175
Other, net 8,618 55,102 10,294
--------------------------------------------
$(176,000) $876,000 $751,000
============================================
</TABLE>
27
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (continued)
The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and deferred tax liabilities at April 30,
1995 and 1994 are presented below:
<TABLE>
<CAPTION>
1995 1994
-----------------------------------
<S> <C> <C>
Deferred tax assets:
Inventories, primarily because
of additional costs capitalized
for tax purposes and the
allowance for decline in
net realizable value $ 447,373 $ 374,240
Accrued directors' fees not
deductible for tax purposes 158,063 177,299
Compensated absences,
not deductible for
tax purposes 108,040 117,956
Other accrued expenses not deductible
for tax purposes 400,121 288,686
Other 318,488 128,202
------------------------------------
Total gross deferred tax assets 1,432,085 1,086,383
------------------------------------
Deferred tax liabilities:
Properties, plant and equipment,
principally because of
differences in depreciation
and capitalized interest 2,208,442 1,855,876
Profit related to installment sale 204,159 217,240
Other 14,218 80,511
------------------------------------
Total gross deferred tax liabilities 2,426,819 2,153,627
------------------------------------
Net deferred tax liability $ 994,734 $1,067,244
====================================
The valuation allowance was $0 at April 30, 1995 and 1994.
</TABLE>
28
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
(9) STOCK OPTION PLAN AND DEFERRED PROFIT-SHARING PLAN
In 1986, the Company adopted a Key Employee Incentive Stock Option Plan which
provides that stock options may be awarded to officers and key employees with
exercise prices no less than the fair market value of the common stock at the
date of grant. Information relating to the Company's stock option plan, as
adjusted for stock dividends, is summarized as follows:
<TABLE>
<CAPTION>
1995 1994 1993
-------------------------------------------------
<S> <C> <C> <C>
Options outstanding
at beginning of year 24,332 40,332 40,332
Options granted -- 6,666 --
Options cancelled -- 6,666 --
Options exercised -- 16,000 --
-------------------------------------------------
Options outstanding
at end of year 24,332 24,332 40,332
=================================================
Option prices per share:
Options granted during
the year $ -- $ 4.6875 $ --
=================================================
Options cancelled $ -- $ 4.6875 $ --
=================================================
Options exercised $ -- $ 2.875 $ --
=================================================
Options outstanding
at end of year $2.875 - 4.50 $2.875 - 4.50 $2.875 - 4.50
</TABLE>
At April 30, 1995, there were 78,002 shares available for options which may
be granted pursuant to the Key Employee Incentive Stock Option Plan.
The Company has a deferred Profit-Sharing Plan ("Plan") which covers
substantially all of its employees. Funded employer contributions to the Plan
for 1995, 1994 and l993 were approximately $571,000, $985,000 and $679,000,
respectively. The net assets in the Plan, which is administered by an
independent trustee, were approximately $11,600,000 at April 30, 1995 and
$11,750,000 at April 30, 1994.
(10) SEGMENT REPORTING
The Company operates in three industry segments: Construction, Manufacturing
and Real Estate.
The construction segment provides construction services for commercial and
industrial projects. The manufacturing segment produces store fixtures for
retail outlets, display fixtures for point-of-sale merchandising and other
products. The real estate segment develops income-producing properties for
sale or for investment. The Company provides property management for some of
the properties after development.
Total revenue by industry segment includes both revenues from unaffiliated
customers, as reported in the Company's consolidated statements of earnings,
and intersegment revenues, which are generally at prices negotiated between
segments.
Identifiable assets are those that are used in the Company's operations in
each segment including receivables due from other segments. The parent
company's identifiable assets are primarily cash and cash equivalents, cash
surrender value of life insurance, and receivables and notes receivable due
from subsidiaries.
The three segments had revenues from one customer aggregating 11%,15% and
30%, of consolidated revenues in 1995, 1994 and 1993, respectively. The
Company had revenues from another customer, primarily representing revenues
in the Construction Segment, aggregating 43%, 53% and 44% of consolidated
revenues in 1995, 1994 and 1993, respectively. In 1995, revenues from another
customer constituted 16% of consolidated revenues. Also, in 1994, revenues
from another customer constituted 10% of consolidated revenues.
Operating profit (loss) is total revenue less operating expenses. In
computing operating profit (loss) of segments, allocated parent expenses and
income taxes have not been deducted.
29<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (continued)
<TABLE>
<CAPTION>
Construction Manufacturing Real Estate Parent Eliminations Consolidated
- ----------------------------------------------------------------------------------------------------------------------------------
1995
<S> <C> <C> <C> <C> <C> <C>
Revenues from unaffiliated customers $94,039,455 $16,348,294 $11,761,136 $ -- $ -- $122,148,885
Interest and other income 89,340 8,245 221,394 316,732 (175,914) 459,797
Intersegment revenue -- -- -- 558,040 (558,040) --
- -----------------------------------------------------------------------------------------------------------------------------------
Total Revenue $94,128,795 $16,356,539 $11,982,530 $ 874,772 $ (733,954) $122,608,682
===================================================================================================================================
Operating profit (loss) $ 2,550,806 $ (478,235) $ (900,864) $(1,228,482) $ (450,244) $ (507,019)
===================================================================================================================================
Identifiable assets $14,188,426 $ 9,385,838 $62,444,725 $ 7,616,258 $(5,058,502) $ 88,576,745
===================================================================================================================================
Depreciation $ 160,916 $ 528,328 $ 2,184,539 $ 16,777 $ (84,756) $ 2,805,804
===================================================================================================================================
Capital expenditures $ 196,801 $ 773,348 $ 140,890 $ 3,755 $ -- $ 1,114,794
===================================================================================================================================
1994
Revenues from unaffiliated customers $86,773,819 $19,530,240 $16,846,265 $ -- $ -- $123,150,324
Interest and other income 85,884 24,618 265,095 275,448 (198,415) 452,630
Intersegment revenue 1,019,898 -- 12,193 1,273,040 (2,305,131) --
- -----------------------------------------------------------------------------------------------------------------------------------
Total Revenue $87,879,601 $19,554,858 $17,123,553 $1,548,488 $ (2,503,546) $123,602,954
===================================================================================================================================
Operating profit (loss) $ 2,535,597 $ 1,680,087 $ (66,350) $ (519,260) $ (1,394,666) $ 2,235,408
===================================================================================================================================
Identifiable assets $14,503,124 $10,858,140 $64,670,299 $7,364,713 $ (4,663,709) $ 92,732,567
===================================================================================================================================
Depreciation $ 117,448 $ 443,758 $ 2,022,860 $ 20,451 $ (81,505) $ 2,523,012
===================================================================================================================================
Capital expenditures $ 230,030 $ 426,446 $ 2,248,230 $ 25,524 $ (233,283) $ 2,696,947
===================================================================================================================================
1993
Revenues from unaffiliated customers $54,742,242 $16,517,697 $11,225,841 $ -- $ -- $ 82,485,780
Interest and other income 82,071 13,196 223,813 331,744 (257,693) 393,131
Intersegment revenue 10,215,871 -- -- 1,674,435 (11,890,306) --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Revenue $65,040,184 $16,530,893 $11,449,654 $2,006,179 $(12,147,999) $ 82,878,911
====================================================================================================================================
Operating profit (loss) $ 2,012,578 $ 1,297,374 $ 236,279 $ 160,910 $ (1,682,048) $ 2,025,093
====================================================================================================================================
Identifiable assets $12,128,142 $ 9,130,329 $70,060,176 $2,020,878 $ (2,802,276) $ 90,537,249
====================================================================================================================================
Depreciation $ 91,636 $ 423,627 $ 1,556,708 $ 24,823 $ (71,580) $ 2,025,214
====================================================================================================================================
Capital expenditures $ 53,890 $ 303,946 $13,627,361 $ -- $ (38,097) $ 13,947,100
====================================================================================================================================
</TABLE>
30
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
<TABLE>
SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS
<CAPTION>
Additions
------------------------------
Balance at Charged to Charged to Balance
Beginning Costs and Other at End
Description of Year Expenses Accounts Deductions of Year
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ALLOWANCE FOR DOUBTFUL ACCOUNTS
Year ended
April 30, 1995 $ 41,041 $ 63,559 $ -- $ 4,411(1) $100,189
===================================================================================================================================
Year ended
April 30, 1994 $ 80,934 $ 254,061 $ -- $ 293,954(1) $ 41,041
- -----------------------------------------------------------------------------------------------------------------------------------
Year ended
April 30, 1993 $ 73,482 $ 163,257 $ -- $ 155,805(1) $ 80,934
- -----------------------------------------------------------------------------------------------------------------------------------
INVENTORY RESERVES
Year ended
April 30, 1995 $ 485,859 $ 287,596 $ -- $ -- $773,455
==================================================================================================================================
Year ended
April 30, 1994 $ 675,000 $1,040,384 $ -- $1,229,525(2) $485,859
- ----------------------------------------------------------------------------------------------------------------------------------
Year ended
April 30, 1993 $ 429,056 $1,504,282 $ -- $1,258,338(2) $675,000
- ----------------------------------------------------------------------------------------------------------------------------------
PROPERTY VALUATION RESERVE
Year ended
April 30, 1995 $ -- $ -- $ -- $ -- $ --
==================================================================================================================================
Year ended
April 30, 1994 $ 399,807 $ 102,453 $ -- $ 502,260(3) $ --
- ----------------------------------------------------------------------------------------------------------------------------------
Year ended
April 30, 1993 $ 399,807 $ -- $ -- $ -- $399,807
- ----------------------------------------------------------------------------------------------------------------------------------
(1) Allowance for doubtful accounts deductions resulted from the subsequent
writeoff and/or recovery of the related receivable.
(2) Inventory reserve deductions resulted from the subsequent sale and/or
writeoff of the related inventory.
(3) Land reserve deductions resulted from the subsequent sale of the related
land.
</TABLE>
31
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
<TABLE>
SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION
April 30, 1995
<CAPTION>
Costs
Capitalized
Subsequent
Initial Cost to Company to Acquisition
---------------------------- -------------- ---------
Building
and
Description Encumbrances Land Improvements Improvements Land
<S> <C> <C> <C> <C> <C>
INCOME-PRODUCING PROPERTIES:
Kmart - Jackson, Michigan $ 609,740 $ 401,195 $ 1,788,183 $ 42,152 $ 401,195
Kmart - Niles, Michigan 2,523,567 191,674 1,616,099 107,431 191,674
Kmart - Tifton, Georgia 892,166 132,894 1,418,266 127,677 132,894
Shopping Center - Newnan, Georgia 5,812,678 696,829 5,291,120 233,719 696,829
Kmart - Warner Robins, Georgia 2,656,871 249,994 1,916,557 94,418 249,994
Kmart - Shawnee, Oklahoma 2,912,783 407,063 1,667,091 1,342,757 407,063
Kmart - Newark, Ohio 1,525,000 153,900 2,296,100 -- 153,900
Kmart - Morton, Illinois 3,499,231 18,005 2,767,765 -- 18,005
Kmart - Columbus, Georgia 3,315,702 11,710 2,356,920 10,078 11,710
Shopping Center - Oakwood, Georgia 4,736,899 556,416 3,568,163 45,944 556,416
Shopping Center - Englewood, FL 13,186,617 6,072,805 8,823,506 (138,153) 6,072,805
Shopping Center - N Ft. Myers, FL 9,915,245 5,940,143 11,290,778 (1,370) 5,940,143
Leaseback Shopping Center - Davenport, IA -- -- 2,150 -- --
Leaseback Shopping Center - Rock Island, IL -- -- 142,986 -- --
Leaseback Shopping Center - Jacksonville, FL -- -- 42,151 -- --
Leaseback Shopping Center - Orange Park, FL -- -- 127,486 -- --
- ----------------------------------------------------------------------------------------------------------------------------------
51,586,499 14,832,628 45,115,321 1,864,653 14,832,628
- ----------------------------------------------------------------------------------------------------------------------------------
LAND HELD FOR INVESTMENT:
Davenport, Iowa -- 183,572 -- -- 183,572
Louisville, Kentucky -- 80,011 -- -- 80,011
Oakwood, Georgia -- 245,112 -- 478,502 723,614
Englewood, Florida -- 504,032 -- -- 504,032
North Fort Myers, Florida -- 3,740,043 -- (280,979) 3,459,064
- ---------------------------------------------------------------------------------------------------------------------------------
-- 4,752,770 -- 197,523 4,950,293
- ---------------------------------------------------------------------------------------------------------------------------------
$51,586,499 $19,585,398 $45,115,321 $2,062,176 $19,782,921
=================================================================================================================================
</TABLE>
NOTE: Reconciliations of total real estate carrying value and accumulated
depreciation for the three years ended April 30, 1995
are as follows:
<TABLE>
Real Estate Accumulated Depreciation
----------------------------------------- ---------------------------------------
1995 1994 1993 1995 1994 1993
------------------------------------------ ---------------------------------------
<S> <C> <C> <C> <C> <C> <C>
BALANCE AT BEGINNING OF YEAR $73,927,553 $77,344,688 $65,537,049 $15,950,677 $14,043,121 $12,575,359
------------------------------------------ ---------------------------------------
ADDITIONS DURING YEAR
Additions 182,539 1,831,997(2) 14,046,392(2) -- -- --
Depreciation -- -- -- 2,082,810 1,907,556 1,467,762
------------------------------------------ ---------------------------------------
182,539 1,831,997 14,046,392 2,082,810 1,907,556 1,467,762
------------------------------------------ ---------------------------------------
DEDUCTIONS DURING YEAR
Carrying value of real estate
sold and retirements 342,267(3) 5,249,132(3) 2,238,753(4) -- -- --
Valuation reserve on
unimproved land -- -- -- -- -- --
------------------------------------------- ---------------------------------------
342,267 5,249,132 2,238,753 -- -- --
------------------------------------------- ---------------------------------------
BALANCE AT CLOSE OF YEAR $73,767,825 $73,927,553 $ 77,344,688 $18,033,487 $15,950,677 $14,043,121
=========================================== =======================================
NOTES:
(1) The aggregated cost for land and building and improvements for federal
income tax purposes at April 30, 1995 is $71,604,164.
(2) Primarily represent additions to a shopping center developed in North
Fort Myers, Florida.
(3) Primarily represents sales of land held for investment in North Fort
Myers, Florida; Atlanta, Georgia; and Gwinnett County, Georgia.
(4) Primarily represents sales of land under development in North Fort
Myers, Florida and land held for investment in Englewood, Florida.
</TABLE>
32
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
<TABLE>
<CAPTION>
Life on Which
Gross Amounts at Which Depreciation
Carried at Close of Year In Latest
Building Net Earnings
and Capitalized Accumulated Date of Date Statement
Improvements Interest Total (1) Depreciation Construction Acquired is Computed
- -----------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <S> <C>
$1,830,335 $ 32,658 $2,264,188 $1,781,252 1972 -- 23 years
1,723,530 75,466 1,990,670 1,410,674 1974,1993 -- 25 years
1,545,943 88,237 1,767,074 1,263,570 1974, 1991 -- 25 years
5,524,839 311,528 6,533,196 2,321,456 1974,1987,1989 -- 31.5 years
2,010,975 76,618 2,337,587 1,674,075 1975 -- 25 years
3,009,848 -- 3,416,911 1,199,537 1979,1991 -- 25 years
2,296,100 -- 2,450,000 1,423,272 1979 -- 25 years
2,767,765 -- 2,785,770 1,660,694 1980,1992 -- 25 years
2,366,998 238,970 2,617,678 1,514,325 1980,1988 -- 25 years
3,614,107 384,700 4,555,223 1,076,189 1988 -- 31.5 years
8,685,353 1,346,273 16,104,431 1,602,644 1990 -- 31.5 years
11,289,408 4,450,480 21,680,031 1,068,124 1993 -- 31.5 years
2,150 -- 2,150 -- 1995 -- 39 years
142,986 -- 142,986 22,577 1994 -- 8 years
42,151 -- 42,151 4,215 1994 -- 25 years
127,486 -- 127,486 10,883 1995 -- 7 years
- -------------------------------------------------------------------
46,979,974 7,004,930 68,817,532 18,033,487
- -------------------------------------------------------------------
-- -- 183,572 -- -- 1977 --
-- -- 80,011 -- -- 1979 --
-- -- 723,614 -- -- 1987 --
-- -- 504,032 -- -- 1989 --
-- -- 3,459,064 -- -- 1993 --
- --------------------------------------------------------------------
-- -- 4,950,293 --
- --------------------------------------------------------------------
$46,979,974 $7,004,930 $73,767,825 $18,033,487
====================================================================
</TABLE>
33
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH INDEPENDENT AUDITORS
ON ACCOUNTING AND FINANCIAL DISCLOSURE.
Not applicable.
PART III
ITEMS 10-13.
The information contained under the headings "Nomination and Election
of Directors," "Principal Holders of the Company's Securities" and
"Compensation of Executive Officers and Directors" in the Company's
definitive proxy materials for its 1995 Annual Meeting of Shareholders, filed
with the Securities and Exchange Commission contemporaneously herewith, is
incorporated herein by reference.
For purposes of determining the aggregate market value of the
Company's voting stock held by nonaffiliates, shares held directly or
indirectly by all Directors of the Company have been excluded. The exclusion
of such shares is not intended to, and shall not, constitute a determination
as to which persons or entities may be "affiliates" of the Company as defined
by the Securities and Exchange Commission.
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
(a) The following documents are filed as part of this Annual Report
on Form 10-K:
1. Financial Statements:
Independent Auditors' Report
Consolidated Balance Sheets at April 30, 1995 and 1994
Consolidated Statements of Operations for the Years Ended April 30,
1995, 1994 and 1993
Consolidated Statements of Shareholders' Equity for the Years Ended
April 30, 1995, 1994 and 1993
Consolidated Statements of Cash Flows for the Years Ended April 30,
1995, 1994 and 1993
Notes to Consolidated Financial Statements
2. Financial Statement Schedules:
Schedule II -- Valuation and Qualifying Accounts
Schedule III -- Real Estate and Accumulated Depreciation
3. Exhibits:
Exhibit No.
3a. Articles of Incorporation*
3b. By-Laws*
10a. Project Financing Agreement by and among Development Authority
of Fulton County, Abrams Fixture Corporation, and
Trust Company Bank, dated as of June 3, 1985**
10b. Abrams Industries, Inc. 1986 Key Employee Incentive Stock
Option Plan***, as amended by Amendment No. 1 to Abrams
Industries, Inc. 1986 Key Employee Stock Option Plan, dated
May 24, 1988#
10c. Directors' Deferred Compensation Plan****#
10d. Edward M. Abrams Split Dollar Life Insurance Agreements
dated July 29, 1991***** #
10e. Joseph H. Rubin Split Dollar Life Insurance Agreement
dated August 27, 1991***** #
10f. Bernard W. Abrams Split Dollar Life Insurance Agreement
dated July 16, 1993****** #
13. Annual Report to Shareholders for the fiscal year ended
April 30, 1995
21. List of the Company's Subsidiaries
* These exhibits are incorporated by reference to the
Company's Form 10-K for the year ended April 30, 1985.
** This exhibit is incorporated by reference to the
Company's Form 10-Q for the quarter ended July 31, 1985.
*** This exhibit is incorporated by reference to the
Company's Form 10-K for the year ended April 30, 1986.
**** This exhibit is incorporated by reference to the Company's
Form 10-K for the year ended April 30, 1991.
***** These exhibits are incorporated by reference to the
Company's Form 10-K for the year ended April 30, 1993.
****** This exhibit is incorporated by reference to the Company's
Form 10-K for the year ended April 30, 1994.
# Management compensatory plans or arrangement.
(b) Reports on Form 8-K: None filed during the fourth quarter of
fiscal 1995.
(c) The Company hereby files as exhibits to this Annual Report on
Form 10-K the exhibits set forth in Item 14(a)3 hereof.
(d) The Company hereby files as financial statement schedules to this
Annual Report on Form 10-K the financial statement schedules set
forth in Item 14(a)2 hereof.
34
<PAGE>
<PAGE>
ABRAMS INDUSTRIES, INC.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
<TABLE>
ABRAMS INDUSTRIES, INC.
<S> <C>
Dated: July 17, 1995 By: /s/ Bernard W. Abrams
---------------------------------------------
Bernard W. Abrams
Chairman of the Board of Directors
and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
Dated: July 17, 1995 /s/ Bernard W. Abrams
-----------------------------------------------
Bernard W. Abrams
Director, Chairman of the Board of Direcctors
and Chief Executive Officer
Dated: July 17, 1995 /s/ Edward M. Abrams
-----------------------------------------------
Edward M. Abrams
Director, President and Treasurer
Dated: July 17, 1995 /s/ Joseph H. Rubin
------------------------------------------------
Joseph H. Rubin
Director, Executive Vice President, Secretary,
Chief Financial Officer, and Chief Accounting Officer
Dated: July 17, 1995 /s/ Alan R. Abrams
------------------------------------------------
Alan R. Abrams
Director
Dated: July 17, 1995 /s/ J. Andrew Abrams
-------------------------------------------------
J. Andrew Abrams
Director
Dated: July 14, 1995 /s/ Richard H. Danielson
-------------------------------------------------
Richard H. Danielson
Director
Dated: July 17, 1995 /s/ Paula Lawton Bevington
-------------------------------------------------
Paula Lawton Bevington
Director
Dated: July 17, 1995 /s/ Donald W. MacLeod
-------------------------------------------------
Donald W. MacLeod
Director
Dated: July 17, 1995 /s/ Anthony Montag
-------------------------------------------------
Anthony Montag
Director
Dated: July 17, 1995 /s/ Felker W. Ward, Jr.
-------------------------------------------------
Felker W. Ward, Jr.
Director
</TABLE>
35
<PAGE>
EXHIBIT 21
-----------
ABRAMS INDUSTRIES, INC.
Abrams Construction, Inc.
Abrams Fixture Corporation
Abrams Properties, Inc.
Merchants Crossing of Englewood, Inc.
Merchants Crossing of North Fort Myers, Inc.
Merchants Crossing, Inc.
South Elmec, Inc.
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000001923
<NAME> ABRAMS INDUSTRIES INC.
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> APR-30-1995
<PERIOD-START> MAY-01-1994
<PERIOD-END> APR-30-1995
<CASH> 8,270,703
<SECURITIES> 0
<RECEIVABLES> 10,782,910
<ALLOWANCES> 100,189
<INVENTORY> 2,655,906
<CURRENT-ASSETS> 24,779,045
<PP&E> 79,694,845
<DEPRECIATION> 24,629,688
<TOTAL-ASSETS> 88,576,745
<CURRENT-LIABILITIES> 13,916,956
<BONDS> 51,580,229
<COMMON> 2,993,540
0
0
<OTHER-SE> 17,878,495
<TOTAL-LIABILITY-AND-EQUITY> 88,576,745
<SALES> 122,148,885
<TOTAL-REVENUES> 122,608,682
<CGS> 108,102,114
<TOTAL-COSTS> 108,102,114
<OTHER-EXPENSES> 10,147,868
<LOSS-PROVISION> 59,148
<INTEREST-EXPENSE> 4,806,571
<INCOME-PRETAX> (507,019)
<INCOME-TAX> (176,000)
<INCOME-CONTINUING> (331,019)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (331,019)
<EPS-PRIMARY> (.11)
<EPS-DILUTED> 0
</TABLE>
