<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------
FORM 10-Q
-------------
Quarterly report pursuant to Section 13 or 15 (d) of the Securities
Exchange Act of 1934
FOR QUARTER ENDED SEPTEMBER 30, 1994
COMMISSION FILE NUMBER 1-4199
CPC INTERNATIONAL INC.
(Exact name of Registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation or organization)
36-2385545
(I.R.S. Employer Identification Number)
INTERNATIONAL PLAZA, P.O. BOX 8000
ENGLEWOOD CLIFFS, N.J. 07632-9976
(Address of principal executive office) (Zip Code)
(201)-894-4000
(Registrant's telephone number, including area code)
Former name, former address and former fiscal year, if changed
since last report.
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 the number of shares outstanding of each of the
registrant's classes of common stock, as of latest
practicable date.
CLASS OUTSTANDING AT SEPTEMBER 30, 1994
Common Stock, $.25 par value 147,670,408 shares
<PAGE> 2
PART I FINANCIAL INFORMATION
ITEM 1. Financial Statements
CPC INTERNATIONAL INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
($ MILLIONS EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ ------------------
1994 1993 1994 1993
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Net sales $1,812.9 $1,664.1 $5,406.9 $4,990.1
-------- -------- -------- --------
Cost of sales 1,111.5 998.0 3,314.3 3,009.2
Operating expenses 459.1 435.8 1,421.4 1,342.3
Restructuring charge -- -- 227.0 --
-------- -------- -------- --------
1,570.6 1,433.8 4,962.7 4,351.5
-------- -------- -------- --------
Operating income 242.3 230.3 444.2 638.6
-------- -------- -------- --------
Financing costs 25.0 21.6 68.8 67.6
-------- -------- -------- --------
Income before income taxes 217.3 208.7 375.4 571.0
Provision for income taxes 85.8 83.1 148.3 228.0
-------- -------- -------- --------
131.5 125.6 227.1 343.0
Minority stockholders'
interest 6.1 3.6 18.5 13.7
-------- -------- -------- --------
Net income $ 125.4 $ 122.0 $ 208.6 $ 329.3
======== ======== ======== ========
Average common shares
outstanding 148.1 150.4 148.8 150.5
Earnings per common
share based on net income
reduced by "ESOP" preferred
stock dividends, net of taxes $ .83 $ .79 $1.35 $2.13
Cash dividends declared
per common share $ .34 $ .32 $1.02 $ .96
</TABLE>
- -----------
See notes to financial statements.
1
<PAGE> 3
CPC INTERNATIONAL INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
($ MILLIONS)
<TABLE>
<CAPTION>
Sept. 30, 1994 Dec. 31, 1993
-------------- -------------
(unaudited)
<S> <C> <C>
ASSETS
- ------
Current assets
Cash and cash equivalents $ 131.0 $ 166.3
Notes and accounts receivable, net 988.9 899.7
Inventories 977.2 830.2
Prepaid expenses 100.2 75.7
-------- --------
Total current assets 2,197.3 1,971.9
-------- --------
Investments in unconsolidated
affiliates 79.8 69.9
-------- --------
Plant and properties 4,434.6 4,080.8
Less accumulated depreciation 2,232.4 1,960.1
-------- --------
2,202.2 2,120.7
-------- --------
Excess cost over net assets of
businesses acquired and other
intangible assets (net of accumulated
amortization of $164.4 and $132.3) 899.8 774.7
-------- --------
Other assets 141.3 123.6
-------- --------
$5,520.4 $5,060.8
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
Current liabilities
Notes and drafts payable $ 786.2 $ 375.0
Accounts payable and accrued items 1,126.3 1,016.3
Income taxes payable 107.7 144.2
Dividends payable 50.2 47.9
------- -------
Total current liabilities 2,070.4 1,583.4
------- -------
Non-current liabilities 770.1 673.6
------- -------
Long-term debt 891.3 897.7
------- -------
Deferred taxes on income (38.0) 42.1
------- -------
Minority interest 134.1 94.9
------- -------
Stockholders' equity
Preferred stock, authorized 25,000,000
shares $1 par value -- --
Designations: Series A ESOP convertible
3,000,000 shares designated - 2,178,743
shares issued at stated value (1993:
2,192,237 shares) 194.4 195.6
Series A Junior Participating 600,000
shares designated - none issued -- --
Common stock authorized 900,000,000
shares $.25 par value - issued 195,271,444 48.8 48.8
Capital in excess of par value of stock 154.7 150.5
Retained earnings 2,826.3 2,774.5
Unearned ESOP compensation (148.2) (155.2)
Cumulative translation adjustment (200.5) (172.6)
Common stock in treasury at cost -
47,601,036 shares (1993: 45,454,592 shares) (1,183.0) (1,072.5)
-------- --------
Total stockholders' equity 1,692.5 1,769.1
-------- --------
$5,520.4 $5,060.8
======== ========
</TABLE>
- -------
See notes to financial statements.
2
<PAGE> 4
CPC INTERNATIONAL INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
($ MILLIONS)
<TABLE>
<CAPTION>
For Nine Months Ended
September 30,
----------------------------
1994 1993
------- --------
<S> <C> <C>
Cash Flows from (used for) operating activities
- -----------------------------------------------
Net income $ 208.6 $ 329.3
Non-cash charges (credits) to net income
Restructuring charge, net of taxes 137.3 --
Depreciation and amortization 217.4 197.9
Deferred taxes 3.7 (6.9)
Translation losses -- 2.9
Other, net (2.3) 15.8
Changes in trade working capital:
Notes and accounts receivable (12.1) 5.9
Inventories (94.5) (83.6)
Accounts payable and accrued items (66.4) (7.2)
------- ------
Net cash flows from operating activities 391.7 454.1
------- ------
Cash Flows from (used for) investing activities
- -----------------------------------------------
Capital expenditures paid (279.9) (221.0)
Disposal of plants and properties 8.9 14.5
Businesses acquired (199.0) (44.0)
------- -------
Net cash flows used for investing activities (470.0) (250.5)
------- -------
Net cash flows after investments (78.3) 203.6
------- -------
Cash Flows from (used for) financing activities
- -----------------------------------------------
Purchase of treasury stock (116.1) (27.1)
Repayment of long-term debt (53.3) (213.6)
New long-term debt 81.9 71.9
Net change in short-term debt 281.0 136.3
Dividends paid on common stock (149.1) (141.5)
Dividends paid on preferred stock (7.8) (7.9)
Common stock issued 5.6 4.5
Other liabilities (deposits) (1.1) (13.6)
------- -------
Net cash flows (used for) financing activities 41.1 (191.0)
------- -------
Effects of exchange rate changes on cash 1.9 (10.1)
------- -------
Increase (decrease) in cash and cash equivalents (35.3) 2.5
------- -------
Cash and cash equivalents, beginning of year 166.3 158.0
------- -------
Cash and cash equivalents, end of period $ 131.0 $ 160.5
======= =======
</TABLE>
- -------
See notes to the financial statements.
3
<PAGE> 5
CPC INTERNATIONAL INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN
STOCKHOLDERS' EQUITY
(UNAUDITED)
($ MILLION)
<TABLE>
<CAPTION>
Preferred
Stock Capital in Unearned Cumulative
Series A Common Excess of Treasury ESOP Translation Retained
ESOP Stock Par Value Stock Compensation Adjustment Earnings
-------- ------ --------- -------- ------------ ----------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1993 $195.6 $48.8 $150.5 $(1,072.5) $(155.2) $(172.6) $2,774.5
Net income for the period 208.6
ESOP compensation earned 7.0
ESOP shares redeemed (1.2)
Common dividends (151.4)
Series A ESOP preferred
stock dividends,
net of taxes (5.4)
Translation adjustment for
the period (27.9)
Shares issued for:
Stock options,
deferred compensation and
restricted stock awards 4.2 5.6
Treasury stock acquired (116.1)
---------------------------------------------------------------------------
Balance, Sept. 30, 1994 $194.4 $48.8 $154.7 $(1,183.0) $(148.2) $(200.5) $2,826.3
===========================================================================
</TABLE>
- -------
See notes to financial statements.
4
<PAGE> 6
CPC INTERNATIONAL INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. INTERIM FINANCIAL STATEMENTS
The unaudited consolidated interim financial statements included herein
were prepared by management and reflect all adjustments (consisting solely of
normal recurring items) which are, in the opinion of management, necessary to
present a fair statement of results of operations for the interim periods ended
September 30, 1994 and 1993 and the financial position as of September 30, 1994
and December 31, 1993.
References to "the Company" are to CPC International Inc. and its
consolidated subsidiaries. These statements should be read in conjunction
with the consolidated financial statements and the related footnotes to these
statements contained in the Company's Annual Report to Stockholders which
notes were incorporated by reference in Form 10-K for the fiscal year ended
December 31, 1993.
2. ACQUISITIONS AND MERGERS
In the first quarter of 1994, the Company acquired an 85% interest in a
European producer and marketer of brand-name potato products. In addition, the
Company acquired the jams, juices and related food products business of a
Company in Sri Lanka. The total costs of these investments amounted to $195
million including assumed debt.
In the second quarter of 1994 the Company purchased the majority
interest of a newly formed company which manufactures and markets selected CPC
food brands in South Africa and exports CPC products to sub-Saharan Africa.
This investment cost about $20 million. Also in the second quarter, the
Company acquired three consumer foods businesses located in the United States,
for a total cost of approximately $67 million. These businesses include;
Western, a brand of salad dressing and specialty sauces, Iberia, a marketer of
Hispanic products in the United States and a smaller business which produces
snacks.
On October 28, 1994, the Company announced that it's Mexican corn
refining business had reached an agreement to form a joint venture with
Arancia, S.A. de C.V. another corn refining company located in Mexico. The
venture expects to have combined sales of approximately $250 million. This
venture will be accounted for on the equity basis.
3. INVENTORIES
Inventories are summarized as follow:
Sept. 30, 1994 Dec. 31,1993
-------------- ------------
Finished and goods in process $631.6 $491.6
Raw materials 202.9 202.6
Supplies 142.7 136.0
------ ------
$977.2 $830.2
====== ======
5
<PAGE> 7
4. LONG-TERM DEBT
A summary of long-term debt is as follows:
<TABLE>
<CAPTION>
Sept. 30, 1994 Dec.31,1993
-------------- -----------
<S> <C> <C>
7.78% ESOP guaranteed notes due
December 2004 $ 178.2 $ 183.3
5.625% -- 6.75% pollution control
revenue bonds due 2007-2016 15.3 15.3
5.02% medium term notes
due 1994-1996 50.0 --
8.5% sinking fund debentures due
April 2016 100.0 100.0
5.75% Swiss franc debentures 149.3 140.8
6.75% German mark debentures 125.8 122.7
Commercial paper supported by revolving
credit agreements 100.0 100.0
Other secured and unsecured notes
and loans at various rates and
due dates 274.8 298.9
------- -------
993.4 961.0
------- -------
Less current maturities 102.1 63.3
------- -------
$ 891.3 $ 897.7
======= =======
</TABLE>
5. CONSOLIDATED STATEMENTS OF CASH FLOWS
Supplementary information for the consolidated statements of cash flows is
set forth below:
<TABLE>
<CAPTION>
For the Nine Months Ended
September 30,
------------------------
<S> <C> <C>
Cash paid during the period for: 1994 1993
---- ----
Interest $ 75.0 $ 70.5
Income taxes 274.4 227.6
Details of businesses acquired
were as follows:
Fair value of assets acquired $460.0 $ 27.6
Less: Liabilities assumed 261.0 2.0
------ -------
Cash paid $199.0 $ 25.6
====== =======
</TABLE>
The details of businesses acquired as shown above, are based on estimates
which will be finalized at year end. In 1993, the Company also acquired the
remaining minority interests in certain companies at a cost of $13.4 million
and made equity contributions of approximately $5 million.
6. FINANCIAL INSTRUMENTS
FOREIGN EXCHANGE CONTRACTS - The Company's policy is to hedge its exposure
in foreign currencies resulting from transactions that comprise mainly planned
dividends, fees and royalties, and intercompany loans. These exposures relate
primarily to the currencies of the major European countries in which the
Company operates, namely Germany, France, the Netherlands, Switzerland and the
United Kingdom. The Company also hedges certain investments in its foreign
operations with similar instruments or with loans denominated in the particular
foreign currency.
6
<PAGE> 8
As a matter of policy, the Company does not speculate in foreign
currencies. Gains and losses, both realized and unrealized, on financial
instruments that hedge operating activities and related cashflows, flow through
income in the same period as the items being hedged.
Gains and losses, both realized and unrealized, on financial instruments
that hedge the Company's investments in foreign operations are recognized as
part of the cumulative translation adjustment in shareholders' equity.
At December 31, 1993 the Company had forward exchange contracts, maturing
in 1994, to deliver $376 million of foreign currencies comprised of $192
million German marks, $90 million British pounds, $35 million French francs,
$33 million Dutch guilders and $26 million of various other currencies
including Belgian francs, Canadian dollars, Danish kroner, Japanese yen and
Spanish peseta. The Company also had, at December 31, 1993, contracts to
purchase $31 million of foreign currencies, primarily German marks.
As of September 30, 1994, the Company had forward exchange contracts to
deliver $240 million of foreign currencies comprised of $70 million British
pounds, $17 million Swiss francs, $71 million Italian lire, $47 million Dutch
guilders, $12 million French francs and $23 million of various other currencies
including Belgian francs, German marks, Canadian dollars, Danish kroner,
Japanese yen and Spanish peseta.
Most of the forward currency contracts outstanding mature within 90 days of
the respective balance sheets, at December 31, 1993 and September 30, 1994.
INTEREST RATE SWAPS - The Company utilizes interest rate swap agreements to
minimize its financing costs and to balance its current and non-current asset
levels with floating interest rate and fixed interest rate debt positions. The
Company's risk on swap agreements is limited to the cost of replacing such
agreements at current market rates. The Company continually monitors its
positions and credit ratings of its counterparties and limits the number of
agreements it enters into with any one party. Management believes the risk of
incurring a material loss is remote.
At December 31, 1993, the Company had $300 million notional amount of
interest rate swap agreements outstanding. A portion of these agreements with
maturity dates through 1995 effectively converted an aggregate principal amount
of $100 million fixed interest rate debt into variable interest rate debt with
a weighted average receive rate of 7.21% and a weighted average pay rate of
3.44%. The remaining agreements with maturity dates through 2000, also
effectively converted $200 million of floating interest rate debt into a fixed
interest rate debt with a weighted average receive rate of 5.88% and a
weighted average pay rate of 5.09%.
7
<PAGE> 9
At September 30, 1994, the Company had $290 million notional amount of
interest rate swap agreements outstanding. A portion of the Company's fixed
rate debt position was hedged with $90 million notional amount of swap
agreements with a weighted average receive rate of 5.65% and a weighted average
pay rate of 4.95%. The remaining agreements with maturity dates through 2000
also effectively converted floating interest rate debt into fixed interest rate
debt with a weighted average receive rate of 5.88% and a weighted average pay
rate of 5.09%.
COMMODITIES - The Company follows a policy of fixing the cost, with
commodities futures contracts, of certain of its key domestic raw material
purchases in line with production requirements to minimize cost risk due to
market fluctuations. Certain domestic raw materials may or may not be hedged
at any given time based on managements decisions as to the need to fix the cost
of such raw materials. In addition, commodity futures contracts are employed
to fix the raw material cost of certain fixed price sales contracts of the corn
refining business. Gains and losses arising from such hedging transactions are
included with the cost of raw material purchases.
The Company's products are manufactured from a number of raw materials,
including soybean and other edible oils, peanuts, corn and wheat, all of which
are, and are expected to continue to be, in adequate supply. However, as
market prices of these materials depend on a number of unpredictable factors
such as farm plantings and weather, resulting fluctuations may have an effect
on the Company's earnings to the extent such fluctuations cannot, for
competitive reasons, always be passed on immediately through pricing
adjustments of the Company's products. It is the possible exposure to such
relatively short term cost/pricing imbalances that the Company attempts to
cover through fixing, when appropriate, the costs of certain commodities in the
short term by using commodities futures contracts. Such contracts are also
employed to fix the commodities' cost of certain fixed price sales contracts of
the corn refining business.
At December 31, 1993 and September 30, 1994 the Company had commodity
futures contracts to purchase primarily corn totaling $111 million and $66
million respectively. The commodity futures contracts at September 30, 1994
primarily call for delivery in the period December 1994 to May 1995. Contracts
for delivery beyond December 31, 1994 aggregate to about $41 million.
Management believes the risk of incurring a material loss from its commodity
contract positions at September 30, 1994 is remote.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
RESULTS OF OPERATIONS
Third quarter earnings per share advanced 5.1% to $.83 from $.79 in the
third quarter last year. Net income of $125.4 million was 2.8% higher than the
$122 million earned in the third quarter of 1993.
8
<PAGE> 10
For the first nine months, excluding a 1994 second quarter restructuring
charge of $.92 per share, E.P.S. increased 6.6% to $2.27 from $2.13. Net
income for the nine month period, excluding the second quarter charge, rose 5%
to $345.9 million from $329.3 million for the same period in 1993.
Worldwide sales for the third quarter advanced 8.9% to $1.81 billion from
$1.66 billion in the third quarter of 1993. Added volumes from acquisitions in
the Company's North American and European consumer foods businesses, and strong
performance in CPC's Asian consumer foods operations and its corn refining
business contributed to the gain.
Worldwide operating income rose 5.2% in the quarter of $242.3 million,
compared to $230.3 million in the third quarter last year. Unfavorable values
of European currencies through most of the quarter restrained the gain
somewhat.
Increased borrowings in connection with acquisition activities and CPC's
ongoing stock buy-back program resulted in somewhat higher financing charges.
The fewer shares outstanding resulting from the buy-back program benefited
earnings per share.
C.R. Shoemate, chairman and chief executive officer, said, "The Brazilian
problem, which as we earlier announced has impacted our third quarter results,
is now behind us, and today our business there is in good shape. Brazilian
volumes are growing well and margins are good. Also, Best Foods is now
experiencing more normal trade conditions, after recently weak volumes mainly
related to trade inventory and pricing situations in their traditional
business.
"With strong margins and profit growth in Europe, Asia, corn refining, and
the rest of our Latin American consumer foods operations, we are confident that
we will achieve our recent estimate for 1994 earnings of $3.16 per share,
excluding the second quarter 1994 restructuring charge."
Mr. Shoemate also said that the Company's restructuring program is
progressing on schedule.
In the nine-month period, worldwide sales rose to $5.41 billion, 8.4%
higher than the $5 billion in sales achieved in the same period last year.
Operating income for the nine months, before the restructuring charge, advanced
5.1% to $671.2 million from $638.6 million for the period last year.
CONSUMER FOODS
Third quarter sales of consumer foods increased 8.7% to $1.5 billion from
$1.4 billion in the third quarter 1993, driven by higher volumes from
acquisitions in North America and Europe. Operating income from consumer
foods, chiefly reflecting substantially lower margins in Brazil, was 1.4% lower
for the quarter.
For the nine-month period, sales from consumer foods rose 7.9% compared to
the same period last year. Operating income for the period was 2.6% higher.
9
<PAGE> 11
Best foods, CPC's North American consumer foods business, reported third
quarter sales growth of 7.6%, as added volumes form acquisitions and favorable
pricing overcame volume declines in several traditional businesses. Best
Foods' operating income for the quarter was flat.
Volumes of Hellmann's mayonnaise and Mazola corn oil were significantly
lower, chiefly due to trade inventory reductions. Skippy peanut butter
volumes, boosted by CPC's new Skippy reduced fat product, rose solidly.
Volumes of Knorr products, Mueller's pasta, and Karo syrup improved, while the
division's bakery products business reported slightly lower volumes.
For the nine-month period, Best Foods' sales rose 7.7%, and operating
income growth was 1.3% higher.
In Europe, CPC's operations recorded an 11.5% sales gain and operating
income of 10.2%, in spite of unfavorable currencies during the quarter. The
gains were largely the result of added volumes from acquisitions and better
margins, which reflected lower costs achieved through the division's cost
reduction and rationalization programs of the last several years. For the nine
months, European sales were up 9% and operating income for the period rose 13%
compared to the same period in 1993.
CPC's Latin American consumer foods operations, reflecting the severe
impact of the Brazilian economic situation, had marginally higher sales, but
operating income dropped 28% in the quarter. In virtually all of its Latin
American consumer foods operations, other than Brazil, CPC's operations grew
strongly. Over the first nine months of 1994, sales from Latin American
consumer foods advanced 4.1%, while operating income was 17% lower.
CPC's Asian consumer foods operations posted excellent results for the
third quarter, with sales and operating income gains of 19% and 20%,
respectively, on a 22% volume gain. The Company's fledgling operations in
China and Sri Lanka are developing well, according to Mr. Shoemate, but as
expected they are not yet contributing to the profit advances. For the first
nine months, sales and earnings from Asia rose 10.6% and 9.3%, respectively.
Corn Refining
CPC's corn refining business, benefiting from favorable pricing, lower
costs, and solidly growing volumes, posted a sales advance of 9.9%, while
operating income grew 30%. These results compare favorably to results in the
same period last year when higher costs and floods in the Midwest had a
significantly negative impact. Both CPC's North American and Latin American
corn refining operations contributed strongly to the gains in this year's third
quarter.
Nine-month results for CPC's corn refining business show a 10.9% sales
increase and a 16% increase in operating income.
10
<PAGE> 12
RESTRUCTURING CHARGE
On June 23, 1994 the Company announced that it had taken a restructuring
charge of $227 million ($137.3 million after taxes) to recognize the cost of
restructuring activities around the world which are being compressed into a
period of 18 to 24 months from that date in order to anticipate now the
competitive needs of the increasingly unified market of the late 1990's.
The majority of the charge relates to the Company's European and North American
consumer food businesses. The restructuring charge is summarized below:
<TABLE>
<CAPTION>
TOTAL CHARGE UTILIZED CHARGE USED IN TO BE UTILIZED
CHARGE IN PRIOR PERIOD CURRENT PERIOD IN FUTURE PERIODS
------ --------------- -------------- -----------------
<S> <C> <C> <C> <C>
Employee severance $102 $ - $ 1 $101
Plant and support
facilities 114 109 5
Other 11 - 1 10
--- --- --- ---
$227 $109 $ 2 $116
=== === === ===
</TABLE>
Since June 30, 1994 is the end of the third quarter for the international
businesses and there was no restructuring utilization to be reported on.
The charge is designed to cover the cost of a phased reduction of about
2,600 employees worldwide combined with the realignment of manufacturing
capacity. The realignment will be achieved through a combination of plant
closures, scale backs and relocations of production. In total, twenty-four
consumer food plants and four corn refining plants will be affected by the
restructuring.
The time period for completion of the restructuring is from a few months
at some sites to two years at others where alternative production sites are to
be constructed.
At September 30, 1994, $57 million of this charge was included in current
liabilities.
LIQUIDITY AND CAPITAL RESOURCES
The Company's primary sources and uses of funds as well as its general
financial policy are discussed on pages 27-30 of the 1993 Annual Report to
Stockholders which were incorporated by reference in Form 10-K for the year
ended December 31, 1993.
The Company's capital expenditures are expected to be approximately $375
million in 1994.
- ----------
Note: The brand names shown on page 9 in distinctive type are trademarks of
CPC International Inc. and its affiliates.
11
<PAGE> 13
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
There have been no material developments in the legal proceedings as
previously reported in Form 10-K for the year ended December 31, 1993.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits pursuant to Item 601 of Regulation S-K.
Exhibit 11 - Statements re: computation of earnings per common share
(Part I data)
b) Reports on Form 8-K.
There were no reports filed on Form 8-K for the quarter ended
September 30, 1994.
12
<PAGE> 14
CPC INTERNATIONAL INC. AND SUBSIDIARIES
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.
CPC INTERNATIONAL, INC.
DATE: November 4, 1994
/S/ KONRAD SCHLATTER
-----------------------------
(Konrad Schlatter)
Senior Vice President &
Chief Financial Officer
DATE: November 4, 1994
/S/ JAMES E. HEALEY
-----------------------------
(James E. Healey)
Comptroller & Chief
Accounting Officer
13
<PAGE> 15
EXHIBIT INDEX
Exhibit 11 - Statements re: computation of earnings per common share
(Part I data)
Exhibit 27 - Financial Data Schedule
<PAGE> 1
EXHIBIT 11
CPC INTERNATIONAL INC. AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER COMMON SHARE
NINE MONTHS ENDED SEPTEMBER 30, 1994 AND 1993
Earnings per common share for CPC International Inc. is based on net income
available to common stockholders and the average number of common shares
outstanding during each period. Net income available to common shareholders
has been reduced by the pro rata ESOP preferred stock dividend net of the tax
benefit. A potentially dilutive effect on earnings per common share results
from the operation of the 1993 and 1984 Stock and Performance Plans and the
Deferred Compensation Plan for Outside Directors. The effect on earnings per
common share resulting from the assumed exercise of outstanding options and
delivery of deferred stock awards under these programs is not material. The
maximum number of shares of common stock issuable and deliverable under such
assumptions, without giving effect to the assumed reacquisitions of common
stock with the proceeds from options exercised, amounted to the following
percentages of the average number of shares of common stock outstanding at
September 30:
1994 1993
---- ----
1.9% 1.5%
Since the dilution resulting from deferred stock awards and stock options is
less than 3%, these items have not been considered in the computation of shares
outstanding. Furthermore, the potentially dilutive effect derived from using
the if-converted method in calculating fully diluted earnings per share for the
ESOP would not cause the dilution to exceed 3% even when considered with the
aforementioned programs.
14
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-01-1994
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0
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