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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 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): February 1, 1999
TRIARC COMPANIES, INC.
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(Exact Name of Registrant as Specified in its Charter)
Delaware 1-2207 38-0471180
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation
280 Park Avenue
New York, New York 10017
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (212) 451-3000
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(Former Name or Former Address, if
Changed Since Last Report)
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<PAGE>
ITEM 5. OTHER EVENTS.
On January 15, 1999 Triarc Companies, Inc. ("Triarc") formed Triarc
Consumer Products Group, LLC ("TCPG"), a wholly-owned subsidiary that will
acquire Triarc's premium beverage (Snapple(R), Mistic(R), and Stewart's(R)),
soft drink concentrate (Royal Crown(R)) and restaurant franchising (Arby's(R),
T.J. Cinnamon's(R), Pasta Connection(TM)) businesses (collectively, the
"Consumer Products Businesses" and, together with TCPG, "TCPG and Related
Companies"). TCPG and Related Companies plan to issue combined financial
statements for their fiscal years 1995, 1996 and 1997 and the nine months ended
September 27, 1998.
Business Segments
Triarc reported its segment disclosures in its Annual Report on Form 10-K
for the fiscal year ended December 28, 1997 ("Triarc's Form 10-K") in accordance
with Statement of Financial Accounting Standards ("SFAS") No. 14 ("SFAS 14")
"Financial Reporting for Segments of a Business Enterprise" which utilized an
industry approach to segment disclosures. In accordance with that approach the
Consumer Products Businesses were reported as two segments in Triarc's Form
10-K: beverages and restaurants. SFAS 14 is being superseded by SFAS No. 131
("SFAS 131") "Disclosures about Segments of an Enterprise and Related
Information" effective for fiscal years ending after December 15, 1998 although
earlier adoption is permitted. Accordingly, Triarc will report its segment
disclosure in its annual report on Form 10-K for the fiscal year ended January
3, 1999 in accordance with SFAS 131. SFAS 131 utilizes a management approach to
define operating segments along the lines used by management internally for
evaluating segment performance and deciding resource allocation to segments. In
accordance therewith, Triarc will now report its former beverage segment as two
segments: premium beverages and soft drink concentrates. Further, SFAS 131
requires the reporting of financial information on the basis that is used
internally for evaluating segment performance and deciding how to allocate
resources to segments. In accordance therewith, Triarc will now report earnings
before interest, taxes, depreciation and amortization ("EBITDA") by segment with
a reconciliation to operating profit or loss by segment. TCPG plans to early
adopt SFAS 131 effective with the issuance of its combined financial statements
for fiscal years 1995, 1996 and 1997 and the nine months ended September 27,
1998.
Aggregate operating profit of the premium beverage and soft drink
concentrate segments to be reported by TCPG and Related Companies in their
combined financial statements for the fiscal years 1995, 1996 and 1997 is
greater than the operating profit of the beverage segment as reported in
Triarc's Form 10-K for the corresponding years by $800,000, $900,000 and
$2,000,000, respectively, due to certain charges recorded at Triarc (parent
company) that will not be included in the combined results of operations of TCPG
and Related Companies. In addition, the operating loss of the restaurant segment
which will be reported by TCPG for 1996 is $5,400,000 less than as reported by
Triarc due to the write-off of a Triarc (parent company) restaurant investment
that will not be included in the combined results of operations of TCPG and
Related Companies. General corporate, reduction in carrying value of long-lived
assets impaired or to be disposed, interest expense, gain (loss) on sale of
businesses, net and other income (expense), net will differ between TCPG and
Triarc principally due to Triarc's segment information including those items as
they related to Triarc Parent as well as the results of Triarc's propane and
textile segments.
The following is a summary of the segment information of TCPG and Related
Companies which will be included in the combined financial statements of TCPG
and Related Companies for the fiscal years 1995, 1996 and 1997 and the nine
months ended September 27, 1998 (in thousands):
<PAGE>
<TABLE>
<CAPTION>
SEPTEMBER 27,
1995 1996 1997 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenues:
Premium beverages.........................$ 41,943 $ 131,083 $ 408,841 $ 495,817
Soft drink concentrates................... 172,644 178,059 146,882 99,166
Restaurants............................... 272,739 288,293 140,429 56,992
------------ ------------ ----------- -----------
Combined revenues....................$ 487,326 $ 597,435 $ 696,152 $ 651,975
============ ============ =========== ===========
EBITDA:
Premium beverages.........................$ 6,387 $ 13,381 $ 7,561 $ 57,470
Soft drink concentrates................... 8,700 18,418 18,504 13,232
Restaurants............................... 24,569 31,819 31,200 29,356
General corporate......................... (171) (189) (149) (100)
------------ ------------ ----------- -----------
Combined EBITDA...................... 39,485 63,429 57,116 99,958
------------ ------------ ----------- -----------
Less depreciation and amortization:
Premium beverages ........................ 2,777 7,233 16,236 16,385
Soft drink concentrates................... 6,848 6,471 6,340 6,832
Restaurants............................... 16,359 16,260 2,668 1,757
General corporate......................... -- -- -- --
------------ ------------ ----------- ----------
Combined depreciation and
amortization..................... 25,984 29,964 25,244 $ 24,974
------------ ------------ ----------- -----------
Less reduction in carrying
value of long-lived assets
impaired or to be disposed:
Restaurants............................... 14,647 58,900 -- --
------------ ------------ ----------- ----------
Operating profit (loss):
Premium beverages ........................ 3,610 6,148 (8,675) 41,085
Soft drink concentrates................... 1,852 11,947 12,164 6,400
Restaurants............................... (6,437) (43,341) 28,532 27,599
General corporate......................... (171) (189) (149) (100)
------------ ------------ ----------- -----------
Combined operating profit (loss)..... (1,146) (25,435) 31,872 74,984
Interest expense............................... (42,386) (50,031) (58,019) (44,658)
Gain (loss) on sale of businesses, net......... (1,000) -- (3,513) 4,934
Other income (expense), net.................... (1,074) 470 5,532 3,703
------------ ------------ ----------- -----------
Combined income (loss) before
income taxes and extraordinary
charges...........................$ (45,606) $ (74,996) $ (24,128) $ 38,963
============ ============ =========== ===========
Identifiable assets:
Premium beverages ........................$ 111,276 $ 110,950 $ 586,731 $ 597,813
Soft drink concentrates................... 205,966 203,847 194,603 183,916
Restaurants............................... 187,631 154,410 53,759 54,039
General corporate ........................ 10,502 11,385 18,868 27,923
------------ ------------ ----------- -----------
Total identifiable assets............$ 515,375 $ 480,592 $ 853,961 $ 863,691
============ ============ =========== ===========
</TABLE>
Recent Developments
Triarc and the Consumer Products Businesses are in the process of closing
their accounting records for the consolidated financial statements of Triarc and
its subsidiaries ("Triarc's Financial Statements") and the combined financial
statements of TCPG and Related Companies ("TCPG's Financial Statements") for the
fiscal 1998 year-end and fourth quarter. While the results of operations of the
Consumer Products Businesses are not the same as those of Triarc, they represent
all of Triarc's 1998 revenues and are a significant component of Triarc's 1998
results of operations. Such estimates of preliminary 1998 fourth quarter results
are subject to any adjustments that may result from completion of the 1998
fiscal year-end closing of the accounting records and the preparation of
Triarc's and TCPG's Financial Statements and the audits thereon. Accordingly,
the estimates for the 1998 fiscal fourth quarter of TCPG and Related Companies
set forth below are subject to material adjustment. Undue reliance should not be
placed on these estimates.
Based on preliminary unaudited operating results for the Consumer Products
Businesses, the initial unaudited estimate of revenues for the Consumer Products
Businesses for the fiscal quarter ended January 3, 1999 (comprised of 14 weeks)
is $163.0 million and the initial unaudited estimate of EBITDA for the Consumer
Products Businesses for such quarter falls within a range of $33.0 million to
$38.0 million. Revenues for the Consumer Products Businesses for the fourth
fiscal quarter of 1997 (comprised of 13 weeks) were $158.2 million and EBITDA
was $25.5 million.
<PAGE>
SIGNATURE
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.
(Registrant)
Date: February 3, 1999 By: /s/ JOHN L. BARNES, JR.
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John L. Barnes, Jr.
Executive Vice President
and Chief Financial Officer
