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FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported) October 25, 1995
ANHEUSER-BUSCH COMPANIES, INC.
(Exact name of registrant as specified in charter)
DELAWARE 1-7823 43-1162835
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
ONE BUSCH PLACE, ST. LOUIS, MISSOURI 63118
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 314-577-2000
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ITEM 5 - OTHER EVENTS
Attached hereto as an exhibit is a press release issued by
Anheuser-Busch Companies, Inc. on October 25, 1995.
ITEM 7 - FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION
AND EXHIBITS
(c) Exhibit
99 - Press Release issued by Anheuser-Busch Companies,
Inc. on October 25, 1995
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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.
ANHEUSER-BUSCH COMPANIES, INC.
(Registrant)
BY: /s/ JoBeth G. Brown
--------------------------
JoBeth G. Brown
Vice President and Secretary
Dated: October 31, 1995
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INDEX TO EXHIBITS
Exhibit No. Exhibit
- ----------- -------
99 Press release issued by Anheuser-Busch Companies,
Inc. on October 25, 1995
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Exhibit 99
ANHEUSER-BUSCH COMPANIES NEWS
From: Fleishman-Hillard, Inc.
200 North Broadway
St. Louis, Missouri 63102
(314)982-1700 FAX 314-231-2313
For more information, contact
Paul Wagman or Barry Murov
at (314) 982-1700
FOR IMMEDIATE RELEASE
- ---------------------
ANHEUSER-BUSCH ANNOUNCES RECORD SALES AND EARNINGS,
AND INITIATIVES TO ENHANCE SHAREHOLDER VALUE
HIGHLIGHTS OF ANHEUSER-BUSCH COMPANIES
THIRD QUARTER EARNINGS RELEASE
- - Anheuser-Busch achieved record sales, earnings and beer market share in
the Third Quarter and first nine months of the year. The company
outperformed the brewing industry as a whole, which experienced sales
declines during the first nine months. Anheuser-Busch achieved higher
increases in beer volume and share than any other major brewer for the
first nine months of 1995.
- In a series of moves to enhance shareholder value, Anheuser-Busch
announced the following initiatives:
1. Selling the snack food business.
2. Consolidating brewing capacity for greater efficiency, resulting in
the closing of the company's Tampa brewery.
3. Selling the St. Louis National Baseball Club (Cardinals).
4. Lowering beer wholesaler inventories in order to achieve greater
system-wide efficiencies and reduce costs.
# # #
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ANHEUSER-BUSCH COMPANIES NEWS
From: Fleishman-Hillard, Inc.
200 North Broadway
St. Louis, Missouri 63102
(314) 982-1700 FAX 314-231-2313
ST. LOUIS, Mo., October 25, 1995 -- Anheuser-Busch Companies, Inc.
achieved record sales and earnings for the Third Quarter and first nine
months of 1995, it was announced today by August A. Busch III, Chairman of
the Board and President. The company also achieved record beer sales volume
and share for the first nine months of 1995, despite an estimated .3 percent
decline in overall brewing industry sales for the period.
The company also announced a series of moves to enhance shareholder
value. When coupled with the spin-off of Campbell Taggart, these actions
will improve the company's cash position in excess of $200 million. These
moves are summarized in this Earnings Release and are further detailed in a
separate press release.
"Anheuser-Busch's sales-to-retailers were up over 1 percent in the
Third Quarter, with August being a record month for sales-to-retailers," said
Mr. Busch. "We are seeing increasing momentum in our core brands, the
Budweiser and Michelob families, with Bud Light and Michelob Light both
growing at double-digit rates. Bud Ice sales have grown since its February
introduction, and several new brands were introduced during the Third
Quarter. This is occurring in conjunction with an improved pricing outlook."
Operating profits for the company's international brewing, packaging and
theme park operations continued to grow at a double-digit pace during the
Third Quarter. These results were partially offset by underperformance at
Eagle Snacks and one-time charges for plant consolidations and other
productivity enhancement initiatives at Campbell Taggart.
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Anheuser-Busch/Add One
Third Quarter 1995 Financial Results
- ------------------------------------
Key financial results for the Third Quarter of 1995 compared to the
Third Quarter of 1994 are summarized below:
- ----------------------------------------------------------------------------
Third Quarter Ended September 30,
------------------------------------------
($ In Millions, Except Per Share) | 1995 vs. 1994
|---------------------
1995 1994 | $ | %
---- ---- | - | -
Gross Sales $3,898 $3,759 | Up $139 | Up 3.7
Net Sales 3,436 3,298 | Up 138 | Up 4.2
Operating Income 602 600 | Up 2 | Up 0.4
Pretax Income 560 549 | Up 11 | Up 1.9
Net Income 340 329 | Up 11 | Up 3.1
Fully-diluted Earnings Per Share 1.31 1.24 | Up .07 | Up 5.6
- ----------------------------------------------------------------------------
Highlights for the Third Quarter 1995 were as follows:
- - Net sales rose $138 million, a 4.2 percent increase compared with the
Third Quarter of 1994. The increase was driven primarily by higher
international beer revenues and higher sales by the company's packaging
and theme park operations.
- - Operating income increased $2 million, or 0.4 percent, in the quarter.
Higher beer packaging material costs, losses at Eagle Snacks and one-
time charges by Campbell Taggart were offset by earnings growth in the
company's other businesses.
- - Net income grew $11 million, or 3.1 percent, and was favorably impacted
by a slightly lower effective tax rate.
- - Earnings per share, on a fully-diluted basis, rose $.07, or 5.6 percent,
to $1.31 per share, compared with $1.24 per share for the Third Quarter
of 1994.
Earnings per share growth continues to benefit from fewer shares
outstanding due to the company's ongoing share repurchase program.
Fully-diluted earnings per share assume conversion of the company's
convertible debentures and elimination of the related after-tax interest
expense. - more -
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Anheuser-Busch/Add Two
Nine Months 1995 Financial Results
- ----------------------------------
Key financial results for the first nine months of 1995 as compared to
1994 are summarized below:
- ----------------------------------------------------------------------------
Nine Months Ended September 30,
------------------------------------------
($ In Millions, Except Per Share) | 1995 vs. 1994
|---------------------
1995 1994 | $ | %
---- ---- | - | -
Gross Sales $10,780 $10,383 | Up $397 | Up 3.8
Net Sales 9,485 9,095 | Up 390 | Up 4.3
Operating Income 1,601 1,562 | Up 39 | Up 2.5
Pretax Income 1,458 1,418 | Up 40 | Up 2.8
Net Income 885 856 | Up 29 | Up 3.3
Fully-diluted Earnings Per Share 3.40 3.20 | Up .20 | Up 6.3
- -----------------------------------------------------------------------------
Highlights for the first nine months of 1995 were as follows:
- - Net sales increased $390 million, or 4.3 percent, for the first nine
months of 1995, reflecting the higher beer sales volume level, higher
revenue per barrel, stronger international beer revenues and higher
sales by the company's packaging and theme park operations.
- - Operating income rose $39 million, or 2.5 percent, compared to the same
period of 1994. The company's beer, packaging and theme park operations
were solid contributors to consolidated growth during the period, offset
partially by the underperformance of Eagle Snacks and one-time charges
at Campbell Taggart.
- - Net income grew $29 million, or 3.3 percent.
- - Fully-diluted earnings per share increased $.20, or 6.3 percent,
compared to the same period in 1994. Earnings per share for the first
nine months also benefited from the company's ongoing share repurchase
program.
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Anheuser-Busch/Add Three
Beer Volume and Market Share
- ----------------------------
Anheuser-Busch, Inc., the company's brewing subsidiary, reported record
Third Quarter sales-to-wholesalers of 24.2 million barrels, up slightly
compared to the Third Quarter of 1994. Sales-to-wholesalers for the first
nine months of 1995 were a record 68.1 million barrels compared to 67.8
million barrels during the first nine months of 1994, an increase of 0.4
percent. The previously announced fall price increases have been implemented
in seven states, and the environment appears favorable for the company's
planned February 1996 price increase in the remainder of the country.
International beer performance increased during the first nine months,
led by continuing sales expansion in the United Kingdom and Ireland.
International brewing's contribution to company profitability for the first
nine months of 1995 increased at a double-digit pace versus the same period
in 1994.
The company has recently introduced or announced seven new beer brands
this year. Busch Ice and Natural Ice were introduced in selected regional
markets. Michelob Amber Bock has been introduced to the national market and
a special Christmas Brew will be added for the important holiday season.
Three "American Original" specialty beers (Faust, Muenchener and Black &
Tan), based on recipes of beers originally brewed by Adolphus Busch in the
late 1800s, were introduced for test marketing in Seattle and Denver.
For the first nine months of 1995, Anheuser-Busch's beer volume
sales-to-wholesalers accounted for 44.3 percent of total U.S. brewing
industry sales (including imports and exports), as estimated from information
provided by The Beer Institute. This compares to a share of 44.0 percent
for the same period last year, an increase of .3 share points.
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Anheuser-Busch/Add Four
Selected Subsidiary Operations
- ------------------------------
Campbell Taggart, the company's baking subsidiary, experienced lower
profits for both the Third Quarter and first nine months of 1995 compared to
the previous year. However, this was primarily because of higher raw
material costs, costs associated with the restructuring of unprofitable
bakery locations and increased expenses related to implementing productivity
improvements. Underlying profit margins for this subsidiary's core businesses
and international operations are up for both the Third Quarter and first nine
months of 1995.
As announced in the second quarter, Campbell Taggart is preparing for
its spin-off from Anheuser-Busch. In anticipation of the spin-off, Campbell
Taggart is continuing to restructure its bakery operations and focus on its
core businesses. The spin-off is on schedule for completion in the first
half of 1996.
Eagle Snacks, the company's snack foods subsidiary, reported operating
losses for the Third Quarter and first nine months of 1995.
Initiatives to Enhance Shareholder Value
- ----------------------------------------
In order to enhance future profitability and devote maximum attention to
the company's core domestic and international beer businesses, the following
initiatives were approved by the Board of Directors today:
1. Selling the Snack Food Business
-------------------------------
Anheuser-Busch has decided to sell the snack food business. The
company has received serious expressions of interest to purchase Eagle
Snacks from qualified parties. "The quality of our snack foods is
second to none, and our production facilities are among the best in
the industry," Mr. Busch said.
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Anheuser-Busch/Add Five
It is anticipated that the sale of Eagle Snacks will result in a
substantial write-off which will be recognized in the Fourth Quarter of
1995. The book value of Eagle Snacks is $240 million and the company
will lose $25 million in 1995. The sale of Eagle Snacks, along with the
spin-off of Campbell Taggart, effectively eliminates Anheuser-Busch's
food products segment, thereby allowing the company to devote maximum
attention to its core businesses.
2. Consolidation of Brewing Capacity
---------------------------------
Through full production at the Cartersville brewery and its
ongoing efficiency program, Anheuser-Busch has been able to add a
significant amount of efficient, lower cost capacity. The Tampa
brewery is the company's highest cost per barrel brewery.
Accordingly, the Tampa brewery will be closed and cease
production by the end of the year resulting in an estimated pretax
write-off in the Fourth Quarter of approximately $150 million ($.36 per
share), but will result in $33 million a year in operational cost savings.
"Earlier this year, our Cartersville brewery --- the most
efficient facility of its kind in the world --- brought 3 million
barrels of expansion capacity on stream," Mr. Busch said. "As
previously announced, Anheuser-Busch will spend $2 billion on a
benchmarking program to bring all production facilities as near as
possible to the efficiency levels we have achieved at our Cartersville
brewery."
3. Sale of St. Louis National Baseball Club (Cardinals)
----------------------------------------------------
Anheuser-Busch has decided to sell the St. Louis National
Baseball Club (Cardinals) in order to better focus attention on its core
businesses. Sale of the club will include Busch Memorial Stadium and
several nearby parking garages owned by the company's Civic Center Corp.
subsidiary in downtown St. Louis. - more -
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Anheuser-Busch/Add Six
In 1995, because of a strike shortened season and the team's
performance, the Cardinals will incur an operating loss of $12 million.
"It is our objective to keep the Cardinals in St. Louis, and the
company will remain a sponsor of major league baseball," Mr. Busch said.
"The question is whether our corporate objectives, which are highly
focused on producing value for Anheuser-Busch shareholders, are
consistent with the needs of the baseball team," he added. "Similarly,
continued ownership of the club diverts significant management efforts
away from the needs of our core businesses."
"We concluded that it is in the best interests of everyone,
including the Cardinals, and the fans, to seek a new owner for the
team," he added.
It is anticipated that the sale of the Cardinals will result in
a substantial gain which will be recognized when the sale is completed.
4. Beer Wholesaler Inventory Reduction Program
-------------------------------------------
In a move that will minimize inventory system costs, the company
will reduce wholesaler inventories during the final two months of the
year.
This lower inventory level will result in a $12 million
system-wide cost savings by both Anheuser-Busch and wholesalers through
improved scheduling, lower transportation costs and reduced working
capital requirements.
"Today's marketplace demands that we take every step we can to be
as efficient as possible," Mr. Busch said. "This step will not only
provide significant savings, but will improve production scheduling at
our breweries and ensure that we continue to have the freshest beer in
the market. Thus, it provides a competitive advantage as well."
- more -
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Anheuser-Busch/Add Seven
Lowering wholesaler inventories will require a one-time reduction
in production levels at the company's breweries. As a result, total
shipments will be down approximately 1.1 million barrels, or 5 percent,
in the Fourth Quarter which will reduce operating profits by
approximately $71 million. For all of 1995, shipments will be reduced
about 1 percent. However, sales-to-retailers --- a more accurate measure
of consumer demand --- will not be affected and will reflect record
levels for the year.
Conclusion
- ----------
"As a result of the moves announced today, and the spin off of Campbell
Taggart, Anheuser-Busch will be a more focused and competitive company,"
Mr. Busch said.
"We plan to achieve three major objectives in coming years," Mr. Busch
stated. "First, we will continue to gain an increased share of the brewing
industry margin pool in the United States. Second, we will continue to
globalize our beer operations. Finally, we will support the growth of our
entertainment and packaging subsidiaries.
"Focus on these objectives will permit the company to capitalize on its
market leadership and competitive advantages in its core brewing business,
enhance profitability through the entertainment of more than 20 million
guests annually, and gain efficiencies through the manufacture of beverage
containers," Busch added.
# # #
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COMPARATIVE STATEMENT OF EARNINGS
THIRD QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
---------------------------------------------------------------
(IN MILLIONS, EXCEPT PER SHARE)
Third Quarter | Year-to-Date
------------- | ------------
1995 1994 | 1995 1994
---- ---- | ---- ----
|
Gross Sales $ 3,897.5 $ 3,759.3 | $ 10,780.2 $ 10,383.3
Excise Taxes (461.3) (461.4) | (1,295.4) (1,288.7)
---------- ---------- | ----------- -----------
Net Sales 3,436.2 3,297.9 | 9,484.8 9,094.6
Cost of Products & Services 2,180.1 2,062.0 | 6,091.5 5,808.4
Marketing, Distribution and |
Administrative Expenses 653.7 635.7 | 1,792.8 1,724.4
--------- ---------- | ----------- -----------
Operating Income 602.4 600.2 | 1,600.5 1,561.8
Interest Expense (54.7) (54.3) | (169.2) (165.1)
Interest Capitalized 6.0 5.6 | 16.8 15.2
Interest Income 2.3 1.3 | 6.6 2.7
Other Income/(Expense), Net 3.9 (3.5) | 3.0 3.2
---------- ---------- | ----------- -----------
Income Before Income Taxes 559.9 549.3 | 1,457.7 1,417.8
Income Taxes (220.2) (219.9) | (572.8) (561.4)
---------- ---------- | ----------- -----------
Net Income $ 339.7 $ 329.4 | $ 884.9 $ 856.4
========== ========== | =========== ===========
Primary Earnings Per Share $ 1.32 $ 1.26 | $ 3.43 $ 3.23
========== ========== | =========== ===========
Fully-Diluted Earnings Per |
Share $ 1.31 $ 1.24 | $ 3.40 $ 3.20
========== ========== | =========== ===========
Capital Expenditures $ 279.6 $ 181.1 | $ 752.6 $ 542.2
========== ========== | =========== ===========
Depreciation and |
Amortization $ 168.8 $ 153.4 | $ 482.6 $ 465.7
========== ========== | =========== ===========
Weighted Average Shares |
Outstanding-Primary 256.7 262.4 | 258.1 265.4
========== ========== | =========== ===========
Weighted Average Shares |
Outstanding-Fully-Diluted 260.9 267.4 | 262.6 270.4
========== ========== | =========== ===========
