SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) March 31, 1994
TRIARC COMPANIES, INC.
(Exact name of registrant as specified in its charter)
OHIO 1-2207 38-0471180
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(State or other (Commission (I.R.S. Employer
jurisdiction of File No.) Identification No.)
incorporation of
organization)
777 South Flagler Drive
Suite 1000E
West Palm Beach, FL 33401
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(Address of principal executive office) (Zip code)
Registrant's telephone number, including area code: (407) 653-4000
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Item 5. Other Events.
On March 31, 1994, the Registrant filed with the Commission
Form 12b-25, stating that for reasons set forth in such Form, the
consolidated financial statements of the Registrant for the
transition period from May 1, 1993 to December 31, 1993 (the
"Transition Period") have not been completed. The Registrant's
form 12b-25 indicated that the Registrant expected its earnings and
other financial results for such period to be as follows:
The Registrant expects to report in its Transition Report on
Form 10-K for the Transition Period revenues of $703.5 million
compared to revenues of $715.9 million in the comparable 1992
period, an operating profit of $30.0 million compared to an
operating profit of $51.1 million in the comparable 1992 period and
a net loss of $39.5 million compared to a net loss of $10.3 million
in the comparable 1992 period. The decrease in revenues of $12.4
million is principally due to the lack of revenues in the 1993
period of operations previously sold or held for sale. The
decrease in operating profit of $21.1 million is principally due to
(i) a $15.4 million increase in advertising and marketing expenses
in the Company's soft drink segment, (ii) a $10.0 million provision
(without tax benefit) in the Transition Period for estimated
insurance loss reserves based on the reviews and recommendations of
the Company's insurance consulting actuaries and new insurance
management company and (iii) a $2.3 million increase in reserves
for legal matters principally for a claim by a former affiliate.
The increase in the net loss of $29.2 million is principally due to
the after-tax effects of the items affecting operating profit noted
above ($20.8 million) as well as (i) a decrease of $11.8 million in
the results of discontinued operations including a $12.4 million
after-tax charge ($8.8 million after minority interests) in the
Transition Period principally to provide for the estimated loss on
the sale of such operations from a previously estimated break-even
position and (ii) a $7.2 million increase in reserves for income
tax contingencies.
In addition, the Registrant also has announced its earnings
and results of operations for such Transition Period in a press
release, which is incorporated herein and a copy of which is
annexed hereto.
Item 7. Financial Statements, ProForma Financial Information and
Exhibits.
(c) Exhibits.
99.1 Press release dated March 31, 1994.
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Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
TRIARC COMPANIES, INC.
Date: April 4, 1994 By: Anthony W. Graziano, Jr.
Anthony W. Graziano, Jr.
Executive Vice President and
General Counsel, and Assistant
Secretary
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Exhibit Index
Exhibit
No. Description Page No.
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99.1 Press Release dated March 31, 1994 5
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Contact: Jerry Hostetter FOR IMMEDIATE RELEASE
(212) 230-3185
TRIARC COMPANIES REPORTS RESULTS
FOR TRANSITION PERIOD UNDER NEW MANAGEMENT
NEW YORK (March 31, 1994)--Triarc Companies, Inc. (NYSE:TRY)
today reported results for the eight-month period ended December
31. As previously reported, the company has adopted December 31 as
the fiscal year-end for each of its businesses. Accordingly, the
company is reporting results for an eight-month "transition
period." Previously, Triarc's fiscal year ended on April 30.
For this 1993 transition period, operating results for the four
core businesses are included as follows: Royal Crown and Arby's,
April 1 to November 30; Graniteville, March 1 to October 31; and
National Propane, May 1 to December 31. The December 1993 after-
tax results for Royal Crown and Arby's and the November-December
1993 after-tax results for Graniteville, not separately included in
results of operations for the transition period, are reported
directly to retained earnings. Previously, Royal Crown, Arby's and
Graniteville were on different fiscal years than Triarc, making
meaningful analysis of the company's results and comparisons to
prior periods difficult.
"Simplifying reporting of the company's results to investors
is essential," said Nelson Peltz, chairman and chief executive
officer. "We will report results by segment for the first calendar
quarter of 1994 and provide investors with worthwhile, comparative
insights into our businesses." Mr. Peltz and Peter May acquired
a controlling interest in DWG Corporation on April 23, 1993. They
changed the name of the company to Triarc in October and listed the
company's stock on the New York Stock Exchange in November.
Triarc also reported that since April 1993 it has made major
progress in implementing new business strategies for each of its
business units, which include: Royal Crown, a major producer of
soft drinks; Arby's, a leading restaurant chain; Graniteville, a
textile manufacturer; and National Propane, a distributor of
liquified petroleum gas.
Mr. Peltz said: "The strategic restructuring we launched last
year to transform Triarc into a successful company is making
excellent progress. Triarc is now focused on four core businesses,
each of which has exciting growth potential."
Major actions to date cited by Mr. Peltz include:
o Raising and committing capital required to support the
growth strategies of the company's core businesses;
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o Successfully divested several peripheral businesses;
o Restructuring the company and incurring the associated
relocation and restructuring charges to properly position
it for long-term profitability and growth; and
o Recruiting new operating management teams at three of the
company's four core businesses and appointing a new chief
executive at the fourth unit.
Peter W. May, president and chief operating officer of Triarc,
said: "Finding superior new management to lead the core businesses
confidently into the future is, without question, our most
important accomplishment to date. We are particularly proud of the
world-class executives who now head our core businesses."
The senior executives now running Triarc's core businesses
include: John Carson, former president of Cadbury Beverages, North
America, now President/CEO of Royal Crown; Don Pierce, former head
of PepsiCo's KFC International, now President/CEO of Arby's; Ron
Paliughi, previously a senior executive at AmeriGas, now
President/CEO of National Propane; and Doug Kingsmore, formerly
executive vice president/COO of Graniteville, who was promoted to
chief executive.
1993 Transition Period
During the eight-month transition period, revenues of Triarc's
four core businesses rose six percent. However, this was more than
offset by the loss of revenues associated with operations
previously sold or held for sale. Triarc recorded revenues of
$703.5 million compared to $715.9 million in the comparable 1992
period, and operating profit of $30.0 million compared to $51.1
million in 1992 and a net loss of $39.5 million versus a net loss
of $10.3 million in 1992.
The lower operating profit in the eight-month transition
period in 1993 is due principally to (i) a $15.4 million increase
in advertising and marketing expenses in the Company's soft drink
segment to generate future growth, (ii) a $10.0 million (without
tax benefit) increase in loss reserves by the Company's captive
insurance subsidiary which stopped writing insurance of any kind
for periods subsequent to September 30, and (iii) a $2.3 million
increase in reserves for legal matters, principally for a claim by
a former affiliate.
The net loss of $39.5 million reflects the after-tax effects
($20.8 million) of the items noted above as well as (i) an $8.8
million provision (after minority interests) principally to provide
for the estimated loss on the sale of discontinued operations, (ii)
a $7.2 million provision for income tax contingencies and (iii) a
$3.8 million provision (without tax benefit) for settlement of the
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last outstanding shareholder derivative litigation brought against
the former management.
"The results for the transition period reflect an effort to
put all issues associated with the company's prior management
behind us so that we can invest in our core businesses and produce
a profitable 1994 and beyond," said Mr. Peltz.
Summary of core business activity in calendar 1993
Each of the company's core businesses has made solid progress
since last April and is well-positioned for further progress in
1994 and beyond.
Royal Crown
Unit sales of private label concentrate doubled during the
year and international unit sales of branded products also were
well above the prior year. Royal Crown domestic branded unit sales
declined in calendar 1993 reflecting, in part, previous
management's ineffective marketing programs and new management's
previously-announced decision to discontinue the practice of year-
end loading of extra, discounted concentrate shipments to bottlers.
In January, Royal Crown signed a worldwide agreement with Cott
Corporation calling for Royal Crown to be Cott's exclusive supplier
for all cola concentrates for retailer-branded beverages
and,wherever possible, to supply Cott's requirements for non-cola
concentrates. Cott has agreed to purchase at least 75 percent of
its total worldwide requirements for all concentrates from Royal
Crown.
Mr. May said that Royal Crown's goal for 1994 and beyond is
domestic unit growth of its branded products of at least 6 percent,
in a market expected to grow about 2 percent. In 1994, Royal Crown
will introduce new packaging for most products and begin the
company's first national television advertising campaign in many
years. RC will provide 9,300 new vending machines to its bottlers
this year. This is four times as many vending machines than
bottlers have placed in the last five years combined.
International and private label unit sales should record strong
progress as well, he said.
"We plan to build the business domestically and
internationally with outstanding brands, solid bottler
relationships, and innovative marketing and advertising," Mr. May
said.
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Arby's
Arby's revenues rose 10 percent in calendar 1993 as same store
sales grew 11 percent. Store margins increased 45 percent,
reflecting new management's emphasis on operational improvement and
the reorganization of field management. Arby's ended the year with
2,682 restaurants, of which 259 were company-owned.
Arby's is planning its first-ever national advertising
campaign, which will begin later this year. Also, programs are in
place to further increase average restaurant sales and continue
margin improvement at the store level. Arby's will commit $40
million in 1994 to build 25 company-owned stores, remodel 80
restaurants and improve operating efficiencies.
Graniteville
In calendar 1993, Graniteville achieved one of the best years
in its 150-year history in terms of sales and operating profits, in
spite of a denim market downturn which began in September. The
company experienced strong results in all four of its product
areas: Utility wear, piece-dyed cotton fabrics for sportswear,
indigo-dyed fabrics for jeans and dyes and specialty chemicals for
the textile industry.
Graniteville is still experiencing a slump in denim demand
and, as a consequence, results for the first half of 1994 at
Graniteville may be below last year. However, the denim market is
expected to begin a recovery in the third quarter. Graniteville
will continue to emphasize value-added products and to invest in
plant modernization to enhance productivity, particularly at C.H.
Patrick, its specialty dye and chemical subsidiary which has had
several years of continued sales and earnings growth.
National Propane
National Propane operating profits in calendar 1993 exceeded
those of 1992, as late in the year the company began to benefit
from the efficiencies of combining seven regional companies into a
centralized organization. As a result of the reorganization, the
company reduced its headcount by 10 percent. "National Propane's
margins will expand dramatically this year as more efficiencies
from its restructuring are realized," said Mr. May. "Graniteville
will have a very good year in 1994," he said.
Triarc vice chairman Leon Kalvaria concluded: "At Triarc,
this has been a year of revolutionary change, of recruiting
outstanding managers, identifying issues and assembling building
blocks for future growth. Now, each of our businesses has new
leadership and growth strategies in place. These plans will
develop and mature in 1994 and produce positive results for
shareholders.
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Triarc Companies, Inc. and Subsidiaries
Condensed Consolidated Results of Operations
(in thousands except per share data)
Eight Months Ended
December 31
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1993 1992
(a) (unaudited)
Revenues $703,541 $715,852
Operating profit 29,969 51,073
Loss from continuing operations (30,210) (6,925)
Income (loss) from discontinued operations (8,820) 3,030
Extraordinary items (448) -
Cumulative effect of changes in
accounting principles - (6,388)
Net loss $(39,478) $(10,283)
Loss per share:
Continuing operations $(1.60) $(.27)
Discontinued operations (.42) .12
Extraordinary item (.02) -
Cumulative effect of changes
in accounting principles - (.25)
Net loss $(2.04) $(.40)
(a) Derived from audited financial statements.
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