SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q/A
Amendment No. 1 to Form 10-Q
x QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended September 30, 1995
OR
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934.
For the transition period from to
Commission File Number 1-3846
CHRISTIANA COMPANIES, INC.
(Exact name of registrant as specified in its charter.)
Wisconsin 95-1928079
(State of Incorporation) (IRS Employer Identification No.)
777 East Wisconsin Avenue, Suite 3380, Milwaukee, Wisconsin 53202
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (414) 291-9000
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. [X] Yes
[_] No
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date:
5,186,630
<PAGE>
The undersigned registrant hereby amends the following items, financial
statements, exhibits or other portions of its Quarterly Report on Form
10-Q for the quarter ended September 31, 1995, as set forth herein:
Part I Item 1. Financial Statements. As discussed at Note 2, the
Consolidated Financial Statements of Christiana Companies, Inc. have been
amended to reflect the adjustment required to change the method of
accounting for the investment in Energy Ventures, Inc. ("EVI") from the
cost method to the equity method.
Part I Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations. This section has been amended as a
result of the matter described above in Item 1.
Part II Item 6. Exhibits and Reports on Form 8-K. The list of exhibits
has been amended to file a financial data schedule reflecting the change
in accounting discussed above.
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CHRISTIANA COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited) (Audited)
Restated
September 30, June 30,
1995 1995
ASSETS:
Cash and cash equivalents $ 194,000 $ 375,000
Short-term investments 4,115,000 2,822,000
Accounts receivable 10,808,000 10,310,000
Inventories 547,000 248,000
----------- -----------
Total Current Assets 15,664,000 13,755,000
----------- -----------
Long-Term Assets:
Investment in Energy Ventures, Inc. 22,290,000 21,886,000
Mortgage notes receivable 3,340,000 3,205,000
Rental properties, net 3,114,000 3,610,000
Fixed assets, net 70,615,000 71,104,000
Other assets 7,983,000 8,182,000
----------- -----------
Total Long-Term Assets 107,342,000 107,987,000
----------- -----------
$123,006,000 $121,742,000
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Current Liabilities:
Accounts payable $ 4,230,000 $ 2,774,000
Accrued liabilities 4,999,000 5,347,000
Short term debt 706,000 1,844,000
Current portion of long-term debt 2,631,000 1,679,000
----------- -----------
Total Current Liabilities 12,566,000 11,644,000
----------- -----------
Long-Term Liabilities:
Long-term debt 36,339,000 38,256,000
Deferred federal and state
income taxes 12,539,000 11,866,000
Other liabilities 1,214,000 1,266,000
----------- -----------
Total Long-Term Liabilities 50,092,000 51,388,000
----------- -----------
Total Liabilities 62,658,000 63,032,000
----------- -----------
Shareholders' Equity:
Preferred stock - -
Common stock, par value $1 per share;
authorized 12,000,000 shares;
issued 5,195,630 5,196,000 5,196,000
Additional paid-in capital 12,022,000 12,022,000
Retained earnings 43,130,000 41,492,000
----------- -----------
Total Shareholders' Equity 60,348,000 58,710,000
----------- -----------
$123,006,000 $121,742,000
=========== ===========
See notes to consolidated financial statements.
<PAGE>
CHRISTIANA COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended
September 30,
1995 1994
Revenues:
Product sales $ - $12,900,000
Warehousing, rental and related
services 19,937,000 19,169,000
---------- ----------
19,937,000 32,069,000
---------- ----------
Costs and Expenses:
Cost of product sales - 10,956,000
Warehousing, rental and related
expenses 16,083,000 14,497,000
Selling, general and administrative 1,801,000 2,643,000
---------- ----------
17,884,000 28,096,000
---------- ----------
Earnings from Operations 2,053,000 3,973,000
Other Income (Expense):
Interest income 128,000 293,000
Interest expense (773,000) (1,114,000)
Gain on sales of real estate 840,000 1,437,000
Equity in earnings of EVI 404,000 -
Other income (expense), net 42,000 (198,000)
---------- -----------
641,000 418,000
---------- -----------
Earnings before income taxes
and minority interest 2,694,000 4,391,000
Income tax provision 1,056,000 1,710,000
---------- -----------
Net earnings before minority
interest 1,638,000 2,681,000
Minority interest - (166,000)
----------- ------------
Net Earnings $ 1,638,000 $ 2,515,000
=========== ============
Net earnings per share $ 0.32 $ 0.46
========= =========
Average number of shares outstanding 5,195,630 5,440,899
See notes to consolidated financial statements.
<PAGE>
<TABLE>
CHRISTIANA COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
<CAPTION>
Additional
Common Stock Paid-in Gain,
Shares Amount Capital Earnings
<S> <C> <C> <C> <C>
Balance, June 30, 1994 5,440,899 $5,441,000 $18,217,000 $36,430,000
Repurchase of Stock (245,269) (245,000) (6,195,000) -
Net Earnings for the Year - - - 5,062,000
--------- --------- ---------- ----------
Balance, June 30, 1995 5,195,630 $5,196,000 $12,022,000 $41,492,000
Net earnings for the
three months ended
September 30, 1995 (unaudited) - - - 1,638,000
--------- --------- ---------- ----------
Balance, September 30, 1995 5,195,630 $5,196,000 $12,022,000 $43,130,000
========= ========= ========== ==========
</TABLE>
See notes to consolidated financial statements.
<PAGE>
CHRISTIANA COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW
(unaudited)
Three Months Ended
September 30,
1995 1994
CASH FLOW FROM OPERATING ACTIVITIES:
Net earnings $1,638,000 $2,515,000
Adjustments to reconcile net earnings
to net cash provided by operating
activities:
Depreciation and amortization 1,936,000 1,977,000
Gains on sales of real estate (1,030,000) (1,433,000)
Deferred income tax expenses 513,000 (418,000)
Minority interest in consolidated
income of subsidiaries - 166,000
Income of unconsolidated affiliate,
net (244,000) -
Changes in assets and liabilities:
(Increase) in accounts receivable (784,000) (4,103,000)
(Increase) decrease in inventory (299,000) 81,000
Decrease in other assets 69,000 122,000
Increase in accounts payable
and accrued liabilities 1,108,000 2,120,000
---------- ----------
Net cash provided by operating activities 2,907,000 1,027,000
CASH FLOW FROM INVESTING ACTIVITIES:
(Increase) decrease in short-term
investments (1,293,000) 1,180,000
Capital expenditures (1,830,000) (3,823,000)
Proceeds from sale of assets 2,273,000 2,777,000
(Increase) in mortgages receivable (135,000) (365,000)
--------- ----------
Net cash (used in) investing
activities (985,000) (231,000)
CASH FLOW FROM FINANCING ACTIVITIES:
Net borrowings (repayments) on
credit lines (1,139,000) 3,870,000
Net payments of notes and
loans payable (964,000) (2,727,000)
---------- -----------
Net cash provided by (used in)
financing activities (2,103,000) 1,143,000
---------- -----------
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS (181,000) 1,939,000
BEGINNING CASH AND CASH
EQUIVALENTS, July 1 375,000 3,929,000
---------- ----------
ENDING CASH AND CASH EQUIVALENTS,
September 30 $ 194,000 $5,868,000
========== =========
Supplemental disclosures of cash
flow information:
Interest paid 738,000 1,107,000
Income taxes paid - -
See notes to consolidated financial statements.
<PAGE>
CHRISTIANA COMPANIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - ACCOUNTING POLICIES
The accompanying unaudited financial statements reflect all adjustments
which are, in the opinion of management, necessary to fairly present the
results for the interim periods presented and should be read in
conjunction with the Company's 1995 Annual Report.
NOTE 2 - RESTATEMENT
The Company has restated its previously issued September 30, 1995
financial statements to reflect the adjustments required to account for
the Company's investment in Energy Ventures, Inc. ("EVI") under the equity
method of accounting instead of the cost method, as was previously
reported.
The restated September 30, 1995 Balance Sheet no longer reports the
Investment in EVI as an available for sale security. Accordingly, the
originally reported "Unrealized Investment Gain, Net of Tax" of $8,128,000
and the related deferred tax components have been removed from the
restated September 30, 1995 Balance Sheet.
The impact of the restatement is as follows:
(Unaudited)
Quarter Ended
September 30, 1995
Earnings Before Income Taxes
and Minority Interest
As previously reported $2,290,000
As restated $2,694,000
Net Earnings
As previously reported $1,394,000
As restated $1,638,000
Earnings Per Share
As previously reported $0.27
As restated $0.32
Shareholders' Equity At 9/30/95
As previously reported $73,615,000
As restated $60,348,000
NOTE 3 - PRO FORMA OPERATING RESULTS
On June 30, 1995, Prideco, Inc. ("Prideco"), a majority-owned subsidiary
of the Company, merged with Grant Acquisition Company, a wholly-owned
subsidiary of Energy Ventures, Inc. ("EVI"). In the merger, the Company's
shares of Prideco were converted into 1,035,858 shares of Common Stock,
$1.00 par value, of EVI. EVI's common stock is listed and traded on the
New York Stock Exchange (NYSE:EVI). Accordingly, the individual accounts
of Prideco have been eliminated from the Company's June 30, 1995 Balance
Sheet which reflects the effect of the merger. Prideco's results of
operations are included in the Company's Consolidated Statement of
Earnings through June 30, 1995, the date of the merger. Concurrently with
the merger, the Company acquired an additional 912,873 shares of EVI
common stock directly from EVI and the minority shareholders of Prideco
for an aggregate cash price of $13,291,000.
The following summarizes the unaudited consolidated pro forma operating
results of the Company as if the merger of Prideco, Inc. and the
acquisition of EVI shares had occurred as of July 1, 1994 the beginning of
the periods.
(In thousands except per share data.)
Three Months Ended
September 30, 1994
Net Revenues $19,169
Net Earnings $ 2,278
Earnings per share $ 0.42
Pro forma results are not necessarily indicative of results that would
have occurred had the merger been made at July 1, 1994, or of results
which may occur in the future.
NOTE 4 - ENERGY VENTURES, INC. SUMMARY FINANCIAL INFORMATION (UNAUDITED)
EVI's fiscal year ends December 31. Summary financial information for
EVI, which is accounted for under the equity method in the Company's
financial statements, is as follows:
THREE MONTHS ENDED
(In Thousands) 9/30/95
Revenues $93,797
Gross Profit 24,256
Income before Income Taxes 4,685
Net Income 3,556
<PAGE>
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Operations
Christiana Companies consolidated revenues for the three months ended
September 30, 1995 were $19,397,000 versus $32,069,000 reported for the
comparable period a year ago. Revenues were lower this period due to the
completed merger of Prideco with a unit of Energy Ventures, Inc.
(NYSE:EVI) on June 30, 1995. Revenues attributable to Warehousing, Rental
and Logistic services increased 4% to $19,937,000 in the first quarter
fiscal 1996 compared with $19,169,000 for the same period last year.
Revenue growth this quarter within this segment occurred at The TLC Group
aided by increased warehousing capacity and marketing efforts directed at
building dedicated transportation volume. Revenues at Wiscold were lower
by 4% due to reduced vegetable freezing volume resulting from poor
regional growing conditions this season.
Operating earnings for the quarter were $2,053,000 versus $3,973,000
generated in the comparable period a year ago. The reduction in operating
earnings is primarily attributable to the absence of Prideco's operations
this quarter and to a lesser extent reduced vegetable freezing volume at
Wiscold.
Sales of 14 condominium homes were completed in the first quarter of
fiscal 1996 which generated a pretax gain of $840,000 compared with sales
of 20 homes in the same period last year which contributed pretax earnings
of $1,437,000.
For the quarter ended September 30, 1995, the Company recognized earnings
from EVI of $404,000 attributable to its 12.9% weighted average ownership
interest.
Consolidated net earnings for the quarter were $1,638,000 or $0.32 per
share compared with $2,515,000 or $0.46 per share for the same period a
year ago. Net earnings were lower this period due to six fewer home
sales, reduced vegetable freezing volume, and reduced interest income
resulting from the use of $13.3 million of interest earning short-term
investments to fund the purchase of 912,873 shares of Energy Ventures,
Inc. in connection with the Prideco transaction.
Financial Condition
Cash equivalents and short term investments totaled $4,309,000 as of
September 30, 1995 compared with $3,197,000 at June 30, 1995, an increase
of $1,112,000. Cash provided by operating activities of $2,907,000 was
attributable primarily to net earnings, depreciation, amortization and
deferred taxes. Cash used in investing activities of $985,000 resulted
from capital expenditures of $1,830,000 primarily attributable to
warehousing and logistics operations and an increase of $1,293,000 in
short term investments offset by proceeds from asset sales, primarily real
estate, of $2,273,000 in this year's first fiscal quarter.
Christiana's operating units have capital commitments to construct new
distribution oriented warehousing capacity. Wiscold is constructing a new
3.5 million cubic foot refrigerated distribution center in Rochelle,
Illinois with an expected cost of $11.5 million. The new facility is
being built on company owned property at the site of its existing 10.6
million cubic foot refrigerated distribution center. This facility is
expected to be completed and operational in the fourth quarter of fiscal
1996.
The TLC Group is expanding its newest dry distribution center in Zeeland,
Michigan by 106,000 sq. ft. When completed during the third quarter of
fiscal 1996, this facility will total 220,000 sq. ft. of dry distribution
capacity. Construction costs of this expansion are expected to be $2.3
million.
The construction of these facilities is expected to be funded primarily by
subsidiary issued term debt.
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
27 Financial data schedule
(b) Reports on Form 8-K
No reports on Form 8-K were filed for the quarter covered by
this report.
<PAGE>
SIGNATURES:
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CHRISTIANA COMPANIES, INC.
(Registrant)
Date: 7/15/96
/s/ Sheldon B. Lubar
Sheldon B. Lubar
Chairman and
Chief Executive Officer
Date: 7/15/96
/s/ William T. Donovan
William T. Donovan
Executive Vice President and
Chief Financial Officer
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED FINANCIAL STATEMENTS OF CHRISTIANA COMPANIES, INC. AS OF AND
FOR THE QUARTER ENDED SEPTEMBER 30, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1996
<PERIOD-START> JUL-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 194,000
<SECURITIES> 4,115,000
<RECEIVABLES> 8,997,000
<ALLOWANCES> 141,182
<INVENTORY> 547,000
<CURRENT-ASSETS> 15,664,000
<PP&E> 92,390,000
<DEPRECIATION> 18,661,000
<TOTAL-ASSETS> 123,006,000
<CURRENT-LIABILITIES> 12,556,000
<BONDS> 38,970,000
0
0
<COMMON> 17,218,000
<OTHER-SE> 43,130,000
<TOTAL-LIABILITY-AND-EQUITY> 123,006,000
<SALES> 0
<TOTAL-REVENUES> 19,937,000
<CGS> 0
<TOTAL-COSTS> 16,083,000
<OTHER-EXPENSES> 1,801,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 773,000
<INCOME-PRETAX> 2,694,000
<INCOME-TAX> 1,056,000
<INCOME-CONTINUING> 1,638,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,638,000
<EPS-PRIMARY> .32
<EPS-DILUTED> .32
</TABLE>
