<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended March 31, 2000 Commission File Number 0-8894
-------------- -------------
BENJAMIN MOORE & CO.
(Exact Name of registrant as specified in its charter)
New Jersey 13-5256230
- -------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
51 Chestnut Ridge Road, Montvale, New Jersey 07645
- -------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (201) 573-9600
----------------------------
None
- -------------------------------------------------------------------------------
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
--- ---
As of May 5, 2000, 26,562,038 shares of Common Stock of the registrant were
issued and outstanding.
-1-
(Page 1 of 15 Pages)
<PAGE>
BENJAMIN MOORE & CO. and Subsidiaries
INDEX
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
Part I. Financial Information
Condensed Consolidated Statements of Income and
Comprehensive Income-
Three Months Ended March 31, 2000 and 1999................................... 3
Condensed Consolidated Balance Sheets -
March 31, 2000 and December 31, 1999......................................... 4
Condensed Consolidated Statements of Cash Flows -
Three Months Ended March 31, 2000 and 1999................................... 5
Notes to Condensed Consolidated Financial Statements............................. 6 - 8
Management's Discussion and Analysis of Financial
Condition and Results of Operations.......................................... 9 - 12
Part II. Other Information........................................................... 12 - 13
</TABLE>
-2-
<PAGE>
PART I. FINANCIAL INFORMATION
BENJAMIN MOORE & CO. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE
INCOME (Unaudited)
(Dollars in Thousands Except Per Share Amounts)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------
2000 1999
------ (As Adjusted)
-------------
<S> <C> <C>
Net sales................................................. $182,902 $170,526
-------- --------
Costs and expenses:
Cost of products sold................................. 105,767 99,344
Selling, general and administrative................... 55,863 51,252
Restructuring......................................... 38,598 -
Other income, net..................................... (1,236) (1,589)
---------- ----------
Total costs and expenses.......................... 198,992 149,007
-------- --------
(Loss)/income before taxes and minority
interest............................................... (16,090) 21,519
Income tax benefit (provision)............................ 6,470 (8,932)
Minority interest in net loss/(income) of
subsidiaries .......................................... 415 (276)
----------- -----------
Net (loss)/income......................................... $ (9,205) $ 12,311
--------- --------
Other comprehensive (loss)/income, net of tax:
Foreign currency translation adjustment
(Net of tax of $(403) and $(581) for March
2000 and 1999, respectively).......................... (491) (777)
Unrealized loss on securities
(Net of tax of $72 for March 2000).................... 108 -
---------- -----------
Other comprehensive (loss)................................ (491) (777)
---------- -----------
Comprehensive (loss)/income............................... $ (9,696) $ 11,534
========= ========
Cash dividends declared per share of
common stock........................................... $ .19 $.17
===== ====
Basic and diluted net (loss)/income per
share (Note 3)......................................... $(.35) $.46
====== ====
</TABLE>
See accompanying notes to condensed consolidated financial statements.
-3-
<PAGE>
BENJAMIN MOORE & CO. and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollars in Thousands)
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
(As Adjusted)
--------- -------------
(a)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents.......................................... $ 10,432 $ 70,553
--------- ---------
Trading securities................................................. 40,230 29,871
---------- ----------
Accounts and notes receivable - net................................ 123,734 91,817
--------- ----------
Inventories:
Finished goods, net............................................... 63,448 56,040
Raw materials and supplies........................................ 28,948 25,376
--------- ---------
Net............................................................ 92,396 81,416
Prepaid expenses and other current assets.......................... 22,752 25,870
--------- ---------
Total current assets........................................... 289,544 299,527
Property, plant and equipment - net.................................... 107,631 104,988
Other non-current assets............................................... 79,771 72,882
--------- ---------
Total assets................................................... $476,946 $477,397
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term debt and current portion of long-term debt.............. $ 11,051 $ 634
Accounts payable................................................... 35,462 35,642
Other liabilities and accrued expenses............................. 46,460 51,136
--------- ---------
Total current liabilities...................................... 92,973 87,412
--------- ---------
Pension and other long-term benefits................................... 37,872 30,180
--------- ---------
Long-term obligations.................................................. 23,842 20,945
--------- ---------
Minority shareholders' interest in net
assets of subsidiaries.............................................. 9,936 10,407
---------- ---------
Shareholders' equity:
Preferred stock, $10 par value - authorized
500,000 shares; issued - none
Common stock, $3.33 1/3 par value - authorized
120,000,000 shares; issued 39,492,936 shares.................... 131,643 131,643
Additional paid-in capital........................................ 47,042 46,967
Retained earnings................................................. 307,859 322,189
Accumulated other comprehensive income............................ (5,766) (5,275)
Cost of treasury stock; 12,904,248 shares at
March 31, 2000 and 12,807,593 shares at
December 31, 1999............................................... (157,705) (155,021)
Employees' stock ownership and stock purchase
plan notes...................................................... (10,750) (12,050)
--------- ---------
Shareholders' equity - net..................................... 312,323 328,453
--------- ---------
Total liabilities and shareholders' equity..................... $476,946 $477,397
======== ========
</TABLE>
(a) The condensed consolidated balance sheet at December 31, 1999 has been
derived from the audited financial statements at that date.
See accompanying notes to condensed consolidated financial statements.
-4-
<PAGE>
BENJAMIN MOORE & CO. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(Dollars in Thousands)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------
2000 1999
(as adjusted)
------ -------------
<S> <C> <C>
Cash flows from operating activities:
Net (loss)/income.................................................. $ (9,205) $ 12,311
Adjustments to reconcile net income to net cash
(used in) provided by operating activities:
Restructuring charge............................................ 38,092 -
Depreciation and amortization................................... 3,472 3,192
Minority interest in net (loss)/income of
subsidiaries.................................................. (415) 276
Deferred taxes.................................................. (8,533) 1,218
Other........................................................... 1,909 2,054
Change in assets and liabilities, net of assets sold:
Increase in accounts and notes receivable................... (32,213) (32,044)
(Increase) decrease in inventories.......................... (11,949) 670
(Decrease) increase in other current liabilities............ (17,387) 19,906
Other....................................................... 65 (4,220)
---------- --------
Net cash (used in) provided by
operating activities................................. (36,164) 3,363
-------- ---------
Cash flows from investing activities:
Purchase of securities (10,000) -
Payments for purchase of property, plant and
equipment and acquisitions........................................ (13,510) (5,454)
Proceeds from sale of White Knight assets.......................... - 3,654
Other.............................................................. (339) (43)
----------- -----------
Net cash used in investing activities.................. (23,849) (1,843)
--------- --------
Cash flows from financing activities:
Net proceeds (repayments) from short-term debt..................... 10,000 (1,367)
Payment of dividends............................................... (8,041) (4,324)
Purchase of treasury stock......................................... (2,690) (1,269)
Other.............................................................. 1,079 922
--------- ----------
Net cash provided by (used in) financing
activities........................................... 348 (6,038)
---------- ----------
Effect of exchange rate changes on cash................................ (456) (418)
---------- ----------
Net decrease in cash................................................... (60,121) (4,936)
Cash and cash equivalents at beginning of period....................... 70,553 97,249
--------- ---------
Cash and cash equivalents at end of period............................. $ 10,432 $ 92,313
======== ========
Supplemental disclosures of cash flow information:
Interest paid...................................................... $ 12 $ 82
Income taxes paid.................................................. $ 13,891 $ 3,519
</TABLE>
See accompanying notes to condensed consolidated financial statements.
-5-
<PAGE>
BENJAMIN MOORE & CO. and Subsidiaries
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands Except Share Amounts)
1. In the opinion of the Company, the accompanying unaudited condensed
consolidated financial statements contain all adjustments (consisting only
of normal recurring accruals) necessary for a fair presentation of its
financial position as of March 31, 2000 and the results of operations for
the three month periods ended March 31, 2000 and 1999, and changes in cash
flows for the three months ended March 31, 2000 and 1999. It is suggested
that these condensed consolidated financial statements be read in
conjunction with the financial statements and notes thereto included in the
Company's Annual Report on Form 10-K for the year ended December 31, 1999.
The results of operations for the three month period ended March 31, 2000
are not necessarily indicative of operations for the entire year.
2. Certain reclassifications have been made in the 1999 financial statements
to conform to the method of presentation used in 2000.
3. The components of the denominator for basic earnings per common share and
diluted earnings per common share are as follows:
<TABLE>
<CAPTION>
Quarter Ended March 31,
2000 1999
------------------------------------------------------------------------------------------------
<S> <C> <C>
BASIC EARNINGS PER COMMON SHARE:
Weighted average common shares outstanding 26,637,016 26,642,085
DILUTED EARNINGS PER COMMON SHARE:
Plus stock options assumed to be exercised 51,556 33,768
---------------------------
Denominator for diluted earnings per common share 26,688,572 26,657,853
===========================
</TABLE>
4. During the first quarter of 2000, the Board of Directors approved a
restructuring of U.S. and Canadian manufacturing operations and offered a
voluntary early retirement program. This plan was designed to lower
manufacturing costs and maximize efficient means of distribution. These
actions resulted in a first quarter pre-tax charge of $38,598, primarily
consisting of enhanced benefits associated with the voluntary early
retirement program of $12,365, severance and benefits of $14,585, asset
write-offs and plant closure costs of $9,348 and other charges of $2,300.
As a result of this restructuring, the Company will have reduced its North
American manufacturing facilities from sixteen to eight and reconfigured
its distribution centers.
The voluntary early retirement program and employee separation packages
resulting from the cessation of manufacturing and/or distribution at
certain facilities and other organization changes affected over 300
employees. Plant closure costs consist of the write-down of property, plant
and equipment, and maintenance costs. The Company expects all separations
to be substantially completed by the end of 2000. The restructuring charge
reduced net income for the quarter ended March 31, 2000 by $22,236 or $.84
per share.
-6-
<PAGE>
5. During the first quarter of 2000, the Company changed its method of
determining the cost of its inventories at its two Canadian subsidiaries
from the last-in, first-out ("LIFO") to the first-in, first-out ("FIFO")
method. The Company believes the FIFO method provides a better matching of
inventory costs with sales in the Canadian market. All previously reported
results have been restated to reflect the retroactive application of this
accounting change as required by generally accepted accounting principles.
The accounting change increased net income by $238 for the quarter ended
March 31, 2000. Net earnings previously reported for the first quarter of
1999 were increased by $543.
6. The Company manufactures and sells coatings for use by the general public
and industrial and commercial users in the U.S. and Canada. As discussed in
Note(s) 7 and 8, during the first quarter of 1999, and in April 2000 the
Company sold certain assets of its Australian and New Zealand subsidiaries.
Transfers between segments and geographic areas are eliminated in
consolidation. The Company has three reportable segments - (1) U.S.
Coatings Manufacturing, (2) U.S. Retail and (3) Canadian Coatings
Manufacturing. Business groups within these three segments are Trade Sales
Coatings, Production Finishes Coatings, and Retail.
Segment data includes intersegment net sales. The Company evaluates the
performance of its U.S. Coatings Manufacturing segment based upon net sales
to external customers and U.S. Retail and net income (loss). The Company
evaluates the performance of its U.S. Retail and Canadian Coatings
Manufacturing segments based upon net sales to external customers and net
income (loss).
The Company does not have any customers to which sales exceed 10% of total
sales.
Operating results by reportable segment and geographic area for the quarter
ending March 31 are as follows:
<TABLE>
<CAPTION>
US Canadian
Coatings US Coatings All Reconciling Consolidated
2000 Manufacturing Retail Manufacturing Others Items Totals
------------- ------ ------------- ------ ----- ------
<S> <C> <C> <C> <C> <C>
Net Sales $140,532 $31,840 $20,675 - $(10,145) $182,902
Net Sales to External
Customers and US
Retail $140,149 $31,840 $19,855 - $ (8,942) $182,902
Net Sales to External
Customers $131,207 $31,840 $19,855 - - $182,902
Net Income (Loss) $ (5,167) $ (441) $ (2,409) - $ (1,188) $ (9,205)
1999
Net Sales $140,777 $12,591 $18,332 $4,071 $(5,245) $170,526
Net Sales to External
Customers and US
Retail $140,396 $12,591 $16,835 $4,071 $(3,367) $170,526
Net Sales to External
Customers $137,029 $12,591 $16,835 $4,071 - $170,526
Net Income (Loss) $ 11,764 $ (482) $ 1,521 $ (457) $ (35) $ 12,311
</TABLE>
-7-
<PAGE>
Reconciling items primarily consist of the elimination of sales and cost of
sales between segments.
The decrease in Net Sales to External Customers (above) and Trade Sales
Coatings (below) over the prior year is due to acquisitions of former
external customers.
The following table represents net sales to external customers by business
group:
<TABLE>
<CAPTION>
2000 1999
------ ------
<S> <C> <C>
Trade Sales Coatings $136,756 $144,712
Production Finishes Coatings 14,306 13,223
Retail 31,840 12,591
----------------------
Total $182,902 $170,526
======================
</TABLE>
7. During the first quarter of 1999, the Company sold certain assets
consisting of inventory and property of the White Knight Paints Pty Limited
subsidiary in Australia.
8. The Company completed the sale of its New Zealand operating subsidiary on
April 6, 2000. New Zealand assets held for sale are recorded in Other
Current Assets within the Consolidated Balance Sheet.
-8-
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
- -------------------------------------------------------------------------------
(Dollars in thousands, except per share amounts)
OPERATING RESULTS 2000 VS. 1999
First quarter 2000 Consolidated Net Sales increased 7.3 percent over 1999,
to $182,902, due to increased Canadian Coatings Manufacturing and U.S. Retail
Segment sales. U.S. Coatings Manufacturing first quarter Net Sales to External
Customers and the U.S. Retail Segment were flat as compared to the first quarter
of 1999. Also, during the first quarter of 2000, the Company sold its New
Zealand subsidiary resulting in no Net Sales within the All Others Segment.
Excluding the impact of acquisitions and divestitures, first quarter 2000 Net
Sales increased 2.5 percent over 1999.
U.S. Coatings Manufacturing Segment Net Sales to External Customers and the
U.S. Retail Segment decreased .2 percent to $140,149 in the first quarter of
2000. By business group within this segment, Trade Sales Coatings Net Sales to
External Customers and the U.S. Retail Segment decreased .4 percent to $128,497
and Production Finishes Coatings Net Sales increased 1.9 percent to $11,652. As
compared to the first quarter 1999, the slight decrease in Trade Sales Coatings
and essentially flat unit volume, is due to the first quarter of 1999 being
favorably impacted by strong dealer purchasing in anticipation of the announced
March 1, 1999 price increase across all Do-It-Yourself product lines. The
increase in Production Finishes Coatings Net Sales in the first quarter of 2000
is primarily attributed to unit volume growth.
Net Sales in the U.S. Retail Segment increased 152.9 percent to $31,840 in
the first quarter due primarily to the effect of acquisitions. As of March 31,
2000, the Company operated 88 owned-retail stores as compared to 39 at March 31,
1999. Comparable store sales increased 8.7% in the first quarter over the prior
year. This increase was due primarily to increased paint sales combined with
sales gains in each of the remaining major product lines (wallcoverings, window
treatments and associated products).
Net Sales to External Customers in the Canadian Coatings Manufacturing
Segment increased 17.9 percent to $19,855 in the first quarter of 2000.
Excluding the effect of exchange rate fluctuations, 2000 Canadian Coatings
Manufacturing first quarter Net Sales to External Customers increased by 13.5
percent as compared to 1999. By business group within this segment, Trade Sales
Coatings increased 14.3 percent to $17,200 and Production Finishes Coatings
increased 48.6 percent to $2,655. As compared to 1999, the increase in Trade
Sales Coatings Net Sales is due to unit volume growth of 10.3 percent and the
benefit of the price increase instituted in 1999. The increase in Production
Finishes Coatings Net Sales as compared to the 1999 first quarter is
attributable to unit volume growth.
As mentioned above, there were no Net Sales within the All Others Segment
in 2000 as a result of the New Zealand subsidiary being sold in 2000 and the
Australian subsidiary being sold in April of 1999. All Others Segment Net Sales
in the first quarter of 1999 were $4,071.
-9-
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
- -------------------------------------------------------------------------------
(Dollars in thousands, except per share amounts)
Consolidated Gross Margin increased in the first quarter from 41.7 percent
in 1999 to 42.2 percent in 2000. The improved gross margin results from
continued manufacturing and purchasing efficiencies in the U.S. Coatings
Manufacturing segment as well as the benefit from the sale of the New Zealand
and Australian subsidiaries which historically reported significantly lower
gross margins. However, this margin improvement was partially offset by a shift
in product mix towards contractor lines within the U.S. and Canadian Coatings
Manufacturing Segments as well as the effect of additional U.S. Retail Segment
operations included in 2000 results which have lower margins than the U.S. and
Canadian Coatings Manufacturing Segments.
Consolidated Selling, General and Administrative expenses ("SG&A") of
$55,863 increased by $4,611 as compared to 1999. SG&A as a percentage of sales
was 30.5 percent in 2000 as compared to 30.1 percent in 1999. The increase in
SG&A resulted from a higher SG&A ratio which is typically associated with retail
operations as well as additional sales and marketing spending attributed to the
Color PreviewTM System introduced in the U.S.
During the first quarter of 2000, the Board of Directors approved a
restructuring of U.S. and Canadian operations and offered an early retirement
program. This plan is designed to lower manufacturing costs and maximize
efficient means of distribution in both the U.S and Canadian Coatings
Manufacturing Segments. This plan resulted in the Company recording a pre-tax
2000 first quarter charge of $38,598 including employee separation costs of
$26,950 and asset impairments and other charges of $11,648.
As a result of the restructuring, the Company will reduce its North
American manufacturing facilities from sixteen to eight and reconfigure its
distribution centers. The Company expects cost reductions of approximately
$13,000 pre-tax in 2001 and approximately $17,000 pre-tax annually thereafter
(an approximate two percentage point improvement in gross profit margin on a
consolidated basis).
The decrease in "Other income, net" is primarily due to decreased interest
income on a lower average cash position for the first quarter of 2000 as
compared to 1999.
Income before taxes and minority interest was a loss of $16,090 for the
first quarter of 2000, a decrease of $37,609 compared to 1999. Excluding the
impact of the 2000 restructuring charge, Income before taxes and minority
interest would have been $22,508, an increase of $989, or 4.6 percent as
compared to last year. The resulting effective income tax rate for the quarter
was 40.2 percent in 2000 as compared to 41.5 percent in 1999. As a result of the
foregoing, the Company generated a net loss of $9,205 for the first quarter of
2000 and, excluding the restructuring charge, net income would have been $13,031
as compared to $12,311 in 1999.
Basic and diluted net loss per share for the first quarter of 2000 was
$.35, and, excluding the restructuring charge, basic and diluted net income per
share would have been $.49, an increase of $.03 as compared to 1999.
-10-
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
- -------------------------------------------------------------------------------
(Dollars in thousands, except per share amounts)
FINANCIAL POSITION AND LIQUIDITY
Net cash flows used in operating activities were $36,164 for the first
quarter ended March 31, 2000 as compared to the net cash flows provided by
operating activities of $3,363 in the first quarter of 1999. The increase in
inventory is primarily due to the build-up of inventory prior to the plant
closings which were announced in the 2000 restructuring. The Company also
made larger tax payments and bonus payments in the first quarter as compared
to 1999.
Net cash flows used in investing activities were $23,849 in the first
quarter of 2000, an increase of $22,006 compared to 1999. Capital spending
increased for the 2000 first quarter by $5,277 as compared to first quarter last
year, driven by continuing initiatives to improve manufacturing productivity. In
addition, the Company invested $10,000 in trading securities as well as
purchased two smaller retail operations for $2,780 in the first quarter 2000.
During the first quarter of 1999, the Company sold certain assets of its White
Knight Paints Pty Limited subsidiary resulting in proceeds of $3,654.
Net cash flows provided by financing activities of $348 in the first
quarter of 2000 are compared to the cash flows used in financing activities of
$6,038 in the first quarter of 1999. Cash flows relating to financing activities
were principally used for payment of dividends and the purchase of treasury
stock. The Company borrowed $10,000 on its line of credit in the first quarter
of 2000 as compared to repayments of borrowings of $1,367 last year. There were
no facility or line of credit borrowings by the Canadian Coatings segment at
March 31, 2000.
Working capital decreased to $196,571 at March 31, 2000 and the current
ratio decreased to 3.1:1 from 3.4:1 for the comparable period last year. This
primarily results from the Company's restructuring initiatives and additional
capital spending to increase manufacturing efficiences and increase batch sizes.
Cash, cash equivalents and short-term investments were $50,662 at March 31,
2000, as compared to $92,313 at March 31, 1999. The Company maintains excellent
relations with its banks and other financial institutions that may serve as
available resources for future growth opportunities, if the need arises.
-11-
<PAGE>
YEAR 2000
The Company has completed its Year 2000 remediation efforts and, since
January 1, 2000, has not experienced any significant problems internally or with
suppliers and customers in connection with this event. Nevertheless, the Company
will continue to monitor its systems in order to stay compliant.
The Company spent approximately $2,000 on its Year 2000 remediation
efforts. No significant future costs are anticipated.
Because the Company has not, to date, experienced any significant problems
in the Year 2000, it does not anticipate any major impact on its operations.
The foregoing discussion contains forward-looking statements as defined in
the Private Securities Litigation Reform Act of 1995. Any statement containing
words, such as, "believes", "anticipates", "should", "plans", "expects",
"estimates" or similiar words, is forward-looking; these statements involve
risks and uncertainties and are based on currect expectations and management's
best estimates derived utilizing numerous assumptions of future events. Factors
that could cause actual results to differ materially from those suggested by any
such statements include, but are not limited to, general business conditions;
strength of the retail economy and the growth in the coatings industry; unusual
weather conditions and competition in the coatings business. There can be no
guarantee that these results will be achieved and actual results could differ
materially from those contemplated estimates.
Part II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO VOTE OF SECURITYHOLDERS
The only matters which were submitted to a vote of shareholders to date
during the 2000 fiscal year were the following, which were acted upon at the
Annual Meeting of Shareholders held on April 27, 2000.
Election of Directors: - The following person was elected as a Class I
Director of the Company to serve for a one year term and received the indicated
votes:
Name For Withheld
---- --- --------
Ward C. Belcher 23,991,145.502 329,457.498
The following persons were elected as Class III Directors of the Company to
serve for a three year term and received the indicated votes:
Name For Withheld
---- --- --------
Frederick J. Costello 24,131,878.932 188,724.068
John C. Moore, Jr. 24,131,878.932 188,724.068
Richard Roob 23,988,862.599 331,740.401
The following persons continue in office as Directors: Class I Directors: -
Benjamin M. Belcher, Jr., Yvan Dupuy and Gerald W. Moore. Class II Directors: -
Charles H. Bergmann, Jr., Robert H. Mundheim, Charles C. Vail and Sara B.
Wardell.
-12-
<PAGE>
ITEM 5. OTHER INFORMATION
At the meeting on April 27, 2000, the Board of Directors of the Company
elected Yvan Dupuy, President and Chief Operating Officer, to the position of
Chief Executive Officer. Mr. Dupuy will serve as President and Chief Executive
Officer and continue as Director. Richard Roob, who will continue to serve as
Chairman of the Board of Directors, previously held the position of Chief
Executive Officer. The position of Chief Operating Officer will remain vacant.
The Board of Directors also declared a regular quarterly dividend of
tweny-one cents per share payable July 3, 2000 to the shareholders of record on
June 1, 2000. This represents an increase of two cents per share in the regular
quarterly dividend.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) The following is an index of the exhibits included in this Form 10-Q:
Exhibit 18 Letter re: Change in Accounting Principles
Exhibit 27 Financial Data Schedule
(b) Reports on Form 8-K - On Form 8-K filed February 15, 2000, the Company
announced record year-end results. Consolidated net sales were $779,517 and
consolidated net income was $78,004. Basic and diluted net income per share was
$2.93. The Company also announced a restructuring of U.S. and Canadian
operations and an early retirement program.
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.
BENJAMIN MOORE & CO.
---------------------------------------
(Registrant)
Date May 15, 2000 /s/ Yvan Dupuy
---------------------------------------
Yvan Dupuy
President and Chief Executive Officer
Date May 15, 2000 /s/ Donald E. Devine II
---------------------------------------
Donald E. Devine II
Chief Financial Officer and
Vice President - Finance
-13-
<PAGE>
EXHIBIT 18
Benjamin Moore & Co.
Letter re: Change in Accounting Principles
For the Three Months Ended March 31, 2000
May 12, 2000
Benjamin Moore & Co.
51 Chestnut Ridge Road
Montvale, New Jersey 07645
Dear Sirs:
At your request, we have read the description included in your Quarterly Report
on Form 10-Q to the Securities and Exchange Commission for the quarter ended
March 31, 2000, of the facts relating to your change in method of determining
the cost of inventories at your two Canadian subsidiaries from the last-in,
first-out ("LIFO") to the first-in, first-out ("FIFO") method. We believe, on
the basis of the facts so set forth and other information furnished to us by
appropriate officials of the Company, that the accounting change described in
your Form 10-Q is to an alternative accounting principle that is preferable
under the circumstances.
We have not audited any consolidated financial statements of Benjamin Moore &
Co. and Subsidiaries as of any date or for any period subsequent to December
31, 1999. Therefore, we are unable to express, and we do not express, an
opinion on the facts set forth in the above-mentioned Form 10-Q, on the
related information furnished to us by officials of the Company, or on the
financial position, results of operations, or cash flows of Benjamin Moore &
Co. and Subsidiaries as of any date or for any period subsequent to December
31, 1999.
Yours truly,
/s/ DELOITTE & TOUCHE LLP
Parsippany, New Jersey
-14-
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION FOR THE THREE MONTHS ENDED
MARCH 31, 2000 EXTRACTED FROM THE CONDENSED CONSOLIDATED STATEMENT OF INCOME AND
COMPREHENSIVE INCOME, CONDENSED CONSOLIDATED BALANCE SHEET, CONDENSED
CONSOLIDATED STATEMENT OF CASH FLOWS AND THE NOTES THERETO AND IS QUALIFIED IN
ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-END> MAR-31-2000
<CASH> 10,432
<SECURITIES> 40,230
<RECEIVABLES> 136,384
<ALLOWANCES> (12,650)
<INVENTORY> 92,396
<CURRENT-ASSETS> 289,544
<PP&E> 220,376
<DEPRECIATION> 112,745
<TOTAL-ASSETS> 476,946
<CURRENT-LIABILITIES> 92,973
<BONDS> 594
0
0
<COMMON> 131,643
<OTHER-SE> 180,680
<TOTAL-LIABILITY-AND-EQUITY> 476,946
<SALES> 182,902
<TOTAL-REVENUES> 182,902
<CGS> 105,767
<TOTAL-COSTS> 200,228
<OTHER-EXPENSES> (1,236)
<LOSS-PROVISION> 1,141
<INTEREST-EXPENSE> (587)
<INCOME-PRETAX> (16,090)
<INCOME-TAX> (6,470)
<INCOME-CONTINUING> (9,205)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (9,205)
<EPS-BASIC> (.35)
<EPS-DILUTED> (.35)
</TABLE>
