<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
Form 10-Q
(Mark One)*
[X] Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange
Act of 1934 for the quarterly period ended March 31, 1995 or [_] Transition
--------------
report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934
for the transition period from _________ to ________
Commission file number 1-5964
-------------------
ALCO STANDARD CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
OHIO 23-0334400
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Box 834, Valley Forge, Pennsylvania 19482
- --------------------------------------------------------------------------------
(Address of principal executive offices)
(Zip Code)
(610) 296-8000
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
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 ___
---
* Applicable only to issuers involved in bankruptcy proceedings during the
preceding five years:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
Yes ___ No ___
* Applicable only to corporate issuers:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of April 30, 1995.
Common Stock, no par value 54,988,788 shares
<PAGE>
INDEX
ALCO STANDARD CORPORATION
PART I. FINANCIAL INFORMATION
- ------------------------------
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheets--March 31, 1995
and September 30, 1994
Consolidated Statements of Income--Three months
ended March 31, 1995 and March 31, 1994
Six months ended March 31, 1995 and March 31, 1994
Consolidated Statements of Cash Flows--Six
months ended March 31, 1995 and March 31, 1994
Notes to Consolidated Financial Statements--
March 31, 1995
Item 2. Management's Discussion and Analysis of Results
of Operations and Financial Condition and Liquidity
PART II. OTHER INFORMATION
- ---------------------------
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES
- ----------
<PAGE>
PART I. FINANCIAL INFORMATION
---------------------------------
ITEM 1: FINANCIAL STATEMENTS (UNAUDITED)
- ----------------------------------------
ALCO STANDARD CORPORATION
CONSOLIDATED BALANCE SHEETS
( IN THOUSANDS )
<TABLE>
<CAPTION>
MARCH 31 SEPTEMBER 30
ASSETS 1995 1994
- ------ ---------------- ----------------
<S> <C> <C>
CURRENT ASSETS
Cash $ 43,849 $ 53,369
Accounts receivable less allowance for doubtful accounts:
3/95 - $34,305; 9/94 - $29,428 1,013,723 915,495
Inventories 720,355 609,974
Prepaid expenses and deferred taxes 136,076 131,638
------------ ------------
Total current assets 1,914,003 1,710,476
------------ ------------
INVESTMENTS AND LONG-TERM RECEIVABLES 49,520 68,472
PROPERTY AND EQUIPMENT, AT COST 676,851 653,722
Less accumulated depreciation 320,883 299,775
------------ ------------
355,968 353,947
------------ ------------
OTHER ASSETS
Excess of cost of acquired companies over equity 823,462 747,629
Miscellaneous 88,208 59,331
------------ ------------
911,670 806,960
------------ ------------
FINANCE SUBSIDIARIES ASSETS 756,824 562,403
------------ ------------
$ 3,987,985 $ 3,502,258
============ ============
</TABLE>
See notes to consolidated financial statements.
<PAGE>
ALCO STANDARD CORPORATION
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
MARCH 31 SEPTEMBER 30
LIABILITIES AND SHAREHOLDERS' EQUITY 1995 1994
- ------------------------------------ ------------- ------------
<S> <C> <C>
CURRENT LIABILITIES
Current portion of long-term debt $ 14,953 $ 12,299
Notes payable 232,168 91,999
Trade accounts payable 467,461 500,166
Accrued salaries, wages and
commissions 80,015 96,987
Deferred revenues 145,724 134,485
Restructuring costs 51,178 56,971
Other accrued expenses 234,062 164,023
-------------- -------------
Total current liabilities 1,225,561 1,056,930
-------------- -------------
LONG-TERM DEBT 441,321 340,771
OTHER LIABILITIES
Deferred taxes 36,332 32,192
Restructuring costs 34,000 50,000
Workers' compensation and other 164,040 156,511
-------------- -------------
234,372 238,703
-------------- -------------
FINANCE SUBSIDIARIES LIABILITIES;
including debt of: 3/95 - $616,555; 655,338 498,710
9/94 - $464,882
SHAREHOLDERS' EQUITY
Series AA convertible preferred
stock, no par value, 4,025
depositary shares issued and 200,918 199,912
outstanding
Common stock, no par value:
Authorized 3/95 - 150,000 shares;
9/94 - 75,000 shares
Issued 3/95 - 55,082 shares; 9/94
- 54,522 shares 588,011 551,215
Retained earnings 687,747 642,634
Foreign currency translation
adjustment (31,782) (22,550)
Cost of common shares in treasury:
3/95 - 214 shares; 9/94 - 74 shares (13,501) (4,067)
-------------- -------------
1,431,393 1,367,144
-------------- -------------
$ 3,987,985 $ 3,502,258
============== =============
</TABLE>
See notes to consolidated financial statements.
<PAGE>
ALCO STANDARD CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
MARCH 31 MARCH 31
----------------------- -----------------------
1995 1994 1995 1994
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
REVENUES
Net sales $ 2,425,354 $ 1,952,627 $ 4,586,145 $ 3,858,616
Dividends, interest and other income 692 899 1,562 1,849
Finance subsidiaries 19,788 15,898 39,728 30,739
----------- ----------- ----------- -----------
2,445,834 1,969,424 4,627,435 3,891,204
----------- ----------- ----------- -----------
COSTS AND EXPENSES
Cost of goods sold 1,819,279 1,451,184 3,425,488 2,881,318
Selling and administrative 522,656 437,343 1,001,930 856,440
Interest 15,047 10,138 26,997 22,281
Finance subsidiaries interest 6,978 6,535 16,597 12,827
----------- ----------- ----------- -----------
2,363,960 1,905,200 4,471,012 3,772,866
----------- ----------- ----------- -----------
LOSS FROM UNCONSOLIDATED AFFILIATE (1,157) (1,893)
----------- ----------- ----------- -----------
INCOME BEFORE TAXES 81,874 63,067 156,423 116,445
TAXES ON INCOME 32,749 25,046 61,829 46,570
----------- ----------- ----------- -----------
NET INCOME 49,125 38,021 94,594 69,875
PREFERRED DIVIDENDS 2,893 2,893 5,786 5,786
----------- ----------- ----------- -----------
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS $ 46,232 $ 35,128 $ 88,808 $ 64,089
=========== =========== =========== ===========
EARNINGS PER SHARE (1) $0.83 $0.64 $1.60 $1.24
=========== =========== =========== ===========
CASH DIVIDENDS PER SHARE OF COMMON STOCK $0.26 $0.25 $0.52 $0.50
=========== =========== =========== ===========
</TABLE>
(1) See Exhibit 11 for computation of earnings per share.
See notes to consolidated financial statements.
<PAGE>
ALCO STANDARD CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
MARCH 31,
------------------------
1995 1994
---------- ----------
<S> <C> <C>
OPERATING ACTIVITIES
Net income $ 94,594 $ 69,875
Additions (deductions) to reconcile
net income to net
cash (used) provided by operating
activities:
Depreciation 36,368 34,352
Amortization 15,800 12,073
Payment of Restructuring costs (16,356)
Provision for losses on accounts 12,217 10,473
receivable
Changes in operating assets and
liabilities, net
of effects from acquisitions and
divestures:
Decrease (increase) in accounts (95,084) 9
receivable
Increase in inventories (92,009) (30,936)
Increase in prepaid expenses (5,620) (30,974)
Increase (decrease) in accounts
payable, deferred
revenues and accrued expenses 21,156 (50,320)
Miscellaneous (4,990) (4,588)
---------- ----------
Net cash (used) provided (33,924) 9,964
INVESTING ACTIVITIES
Proceeds from sale of property and 13,624 9,417
equipment
Payments received on long-term 1,943 6,970
receivables
Cost of companies acquired, net of (81,971) (18,357)
cash acquired
Expenditures for property and (47,058) (51,432)
equipment
Purchases of miscellaneous assets (29,817) (3,579)
Finance subsidiaries receivables - (310,643) (162,304)
additions
Finance subsidiaries receivables - 141,638 98,339
collections
---------- ----------
Net cash used (312,284) (120,946)
FINANCING ACTIVITIES
Proceeds (repayments) from short-term 135,000 (3,278)
borrowings, net
Proceeds from issuance of long-term 121,826 107,995
debt
Proceeds from option exercises and 40,600 37,165
sale of treasury shares
Proceeds from issuance of common 293,511
stock, net
Long-term debt repayments (24,177) (318,340)
Finance subsidiaries debt - additions 204,246 57,143
Finance subsidiaries debt - repayments (52,573) (15,308)
Dividends paid (33,160) (27,611)
Purchase of treasury shares (55,074) (23,655)
---------- ----------
Net cash provided 336,688 107,622
---------- ----------
NET DECREASE IN CASH (9,520) (3,360)
CASH AT BEGINNING OF YEAR 53,369 36,495
---------- ----------
CASH AT END OF PERIOD $ 43,849 $ 33,135
========== ==========
See notes to consolidated financial statements.
</TABLE>
<PAGE>
ALCO STANDARD CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1995
Note 1: Basis of Presentation
---------------------
The accompanying unaudited condensed consolidated financial statements
have been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q and
Rule 10-01 of Regulation S-X. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. For further information, refer to the
consolidated financial statements and footnotes thereto included in the
Company's annual report on Form 10-K for the year ended September 30, 1994.
Note 2: Debt
----
On December 1, 1994, the Company entered into a credit agreement with 14
banks to borrow up to $500 million. This multi-currency facility replaced three
other lines of credit amounting to approximately $415 million. The agreement has
two parts: $350 million is subject to termination on December 1, 1999; the other
$150 million is available for 364 days subject to annual renewal for successive
364-day periods. Facility fees of 10 basis points per annum on the five-year
portion and 8 basis points per annum on the 364-day portion are charged for
these commitments. The agreement provides that loans may be made under either
domestic or Eurocurrency notes at rates computed under a selection of rate
formulas including prime or Eurocurrency rates. At the same time, the Company
has reduced the commitment under another agreement from $200 million to $100
million.
Note 3: Supplemental Information to Statements of Cash Flows
----------------------------------------------------
The Company has presented statements of cash flows for the periods ended
March 31, 1995 and 1994 in accordance with SFAS No. 95.
Interest paid for the six months ended March 31, 1995 was $38.2 million.
Interest paid for the six months ended March 31, 1994 was $34.6 million.
Income tax payments of $17 million and $40.5 million were made during
the six months ended March 31, 1995 and 1994, respectively.
The total assets for acquisitions amounted to $146 million during the
six months ended March 31, 1995 and $43 million during the six months ended
March 31, 1994. The excess of cost over acquired equity included in these assets
was $92.8 million and $21.4 million, respectively.
<PAGE>
Item 2: Management's Discussion and Analysis of Results of Operations and
- -------------------------------------------------------------------------
Financial Condition and Liquidity
---------------------------------
Results of Operations
---------------------
Three Months Ended March 31, 1995
Compared with Three Months Ended March 31, 1994
-----------------------------------------------
Revenues and income before taxes for the second quarter of fiscal 1995
versus the second quarter of fiscal 1994 were as follows:
<TABLE>
<CAPTION>
Revenues Income Before Taxes
-------------------------- -------------------------
March 31 % March 31 %
--------------- -------------
1995 1994 Change 1995 1994 Change
----- ---- ------ ---- ---- ------
<S> <C> <C> <C> <C> <C> <C>
(in millions)
Alco Office Products $ 698 $ 544 28.3% $ 59.0 $47.8 23.4%
Unisource
United States 1,551 1,268 22.3 42.4 34.3 23.6
Canada 199 159 25.2 10.6 2.9
------ ------ ----- ----
Total Unisource 1,750 1,427 22.6 53.0 37.2 42.5
------ ------ ----- ----
Operating 2,448 1,971 24.2 112.0 85.0 31.8
Unconsolidated affiliate (1.2)
Interest (15.0) (10.1)
Eliminations and
non-Allocated (2) (2) (15.1) (10.6)
------ ------ ----- ----
$2,446 $1,969 24.2 $ 81.9 $63.1 29.8
====== ====== ===== ====
</TABLE>
The Company's revenues for the second quarter of fiscal year 1995 were
$2.4 billion, 24.2% ahead of the comparable period in the prior year. Income
before taxes increased to $81.9 million from $63.1 million reported in the
second quarter of fiscal year 1994. Earnings per share of $.83 were 29.7% higher
than the $.64 reported in the prior year.
Alco Office Products generated $154 million in increased revenues of
which $85 million related to AOP's base companies and $69 million to current and
prior year acquisitions. Internal growth in AOP's base companies continues to be
across all revenue segments but primarily in equipment sales and the facilities
management businesses. Revenues from Unisource's U.S. operations increased by
$283 million. All but $19 million, which related to current and prior year
acquisitions was the result of the strong internal growth within Unisource.
Unisource's Canadian operations increased their revenues by $40 million despite
a $10 million negative impact from foreign exchange rates. The improvement in
Unisource's revenues reflects both price and volume increases in its fine paper
and supply systems businesses.
AOP's operating income increased by $11.2 million. Current and prior
year acquisitions contributed $5.7 million. The remaining $5.5 million
represents the internal growth from its base companies. This growth primarily
represents higher operating contributions from the service, supply and
facilities management areas of AOP's businesses, but also includes increased
operating income related to its leasing activities through Alco Capital
Resource, Inc.(Alco Capital).
Alco Office Products has initiated a three year program to change its
organization into a more cohesive and efficient network by building a uniform
information technology system and implementing best practices for critically
important management functions throughout the AOP companies. The initiative will
include the exploration of new vendor alliances, the establishment of a national
identity for the group, and a targeted national accounts program.
<PAGE>
Operating income from Unisource's U.S. paper operations increased $8.1
million which includes $7.1 million from its base companies and $1 million from
current and prior year acquisitions. The increase in operating income was due to
cost reductions gained as a result of Unisource's ongoing restructuring,
productivity gains and the impact from price and volume increases realized
during the quarter. The increase of $7.7 million in the Canadian paper
distribution business represents the positive effects of price increases and
gains in market share in the printing paper business along with cost reductions
resulting from restructuring.
Revenues from the Company's paper and office products operations outside
the U.S. were $271 million for the second quarter of fiscal 1995 compared to
$208 million for the same period of the prior fiscal year. The increase includes
$40 million from the Canadian paper distribution business and $4 million of
internal growth in the AOP Canadian operations. It also includes $19 million
relating to the European operations of Erskine and two companies acquired in
September 1994. The Company incurred an equity loss of $1.2 million from IMM
Office Systems GmbH (IMMOS) in the second quarter of fiscal 1994. The investment
in IMMOS was sold in September 1994. Income from foreign operations was $16
million for the three months ended March 31, 1995, up $9 million from the prior
year, primarily attributable to the Canadian paper distribution business.
Interest expense increased overall by approximately $4.9 million, the
net effect of increased borrowing levels and interest rates during fiscal 1995.
Income before taxes increased by $18.8 million primarily reflecting the combined
result of improved operations from base companies along with earnings
contributed by acquisitions. The effective income tax rate for the second
quarter was 40% compared with 39.7% for the comparative period in fiscal 1994.
Weighted average shares of 55.7 million for the second quarter of fiscal 1995
were 1.1 million shares greater than the 54.6 million for the prior year's
second quarter, primarily a result of shares issued in connection with
acquisitions.
As previously indicated the Company was in arbitration with a former
subsidiary, which had asserted that the Company was liable for certain
liabilities arising under the Coal Industry Health Benefit Act of 1992. The
Company has agreed to pay $10 million to the former subsidiary to settle claims
arising under this claim, which primarily has been charged against existing
reserves for discontinued operations. The Company has paid $5 million during the
second quarter of fiscal 1995 with the remaining $5 million to be paid over the
next four years.
Six Months Ended March 31, 1995
Compared with Six Months Ended March 31, 1994
---------------------------------------------
Revenues and income before taxes for the first half of fiscal 1995
versus the first half of fiscal 1994 were as follows:
<TABLE>
<CAPTION>
Revenues Income Before Taxes
------------------------ ---------------------
March 31 % March 31 %
------------- ------------
1995 1994 Change 1995 1994 Change
---- ---- ------ ------------ ------
<S> <C> <C> <C> <C> <C> <C>
(in millions)
Alco Office Products $1,334 $1,042 28.0% $114.2 $90.3 26.5%
Unisource
United States 2,918 2,534 15.2 78.5 63.2 24.2
Canada 379 319 18.8 17.1 5.1
------ ------ ----- -----
Total Unisource 3,297 2,853 15.6 95.6 68.3 40.0
------ ------ ----- -----
Operating 4,631 3,895 18.9 209.8 158.6 32.3
Unconsolidated affiliate (1.9)
Interest (27.0) (22.3)
Eliminations and
non-Allocated (3) (4) (26.4) (18.0)
------ ----- ----- -----
$4,628 $3,891 18.9% $156.4 $116.4 34.4%
====== ===== ====== =====
</TABLE>
<PAGE>
Alco Office Products contributed $292 million of additional revenues, of
which $73 million related to fiscal 1994 acquisitions and $37 million to fiscal
1995 acquisitions. The remaining $182 million increase reflects continued
internal growth in all revenue areas of AOP's base companies, but particularly
in its equipment sales, service and facilities management businesses. The $384
million increase in revenues from Unisource's U.S. operations includes $6
million from prior year acquisitions and $17 million from current acquisitions.
The remaining $361 million increase reflects internal growth from its base
companies. The $60 million revenue increase in the Unisource Canadian paper
businesses is attributable to price and volume increases in the fine paper and
supply systems businesses and is despite the negative impact from foreign
exchange rates.
AOP's operating income increase of $23.9 million includes $6.3 million
from prior year acquisitions and $3.2 million from current acquisitions. The
remaining $14.4 million increase reflects internal growth from its base
companies which is primarily the result of higher operating contributions from
the service, facilities management and supply areas of AOP's businesses, along
with increased operating income related to its leasing activities through Alco
Capital. Operating income from Unisource's U.S. paper operations increased $15.3
million. This increase represents a contribution of $1.2 million from current
and prior year acquisitions. The remaining $14.1 million is from its base
companies which reflects the impact of price and volume increases along with the
cost reductions realized from the restructuring. The Canadian paper distribution
business increase in operating income of $12 million is the result of the growth
and price increases in the fine paper distribution business and cost reductions
which combined more than offset any negative fluctuations in the Canadian
foreign exchange rates.
Geographically, revenues from the Company's paper and office products
operations outside the U.S. was $518 million for the first half of fiscal 1995
compared to $413 million for the same period in the prior fiscal year. The
increase reflects $60 million from the Canadian paper distribution business and
$7 million of internal growth in the AOP Canadian operations. It also reflects
$38 million relating to the European operations of Erskine and two companies
acquired in September 1994.
Operating income from foreign operations was $26 million for the six
months ended March 31, 1995 up $14 million from the prior year primarily the
result of the increase in operating income of the Canadian paper distribution
business. For the first six months of fiscal 1994, the Company incurred a $1.9
million loss from its investment in an unconsolidated affiliate, IMM Office
Systems GmbH.
Interest expense increased by $4.7 million from the comparable period in
fiscal 1994, a result of higher borrowing levels and interest rates during
fiscal 1995, offset by the effect of the debt reduction resulting from the
Company's common stock offering in December 1993. The increase in income before
taxes of 34.4% or $40 million is a combined result of improved operations from
our base companies along with the earnings contributed by acquisitions. The
effective income tax rate for the current period was 39.5% compared with 40% in
fiscal 1994. At March 31, 1995 weighted average shares were 3.9 million shares
greater than the 52 million shares at March 31, 1994. This increase includes the
impact of a public offering of common stock in December, 1993 and acquisition
activity.
The major components of the Unisource restructuring plan are proceeding
as planned. Unisource management has reduced the pace at which changes are being
made in order to better control the transformation process, thereby affecting
the pace of planned headcount reductions and the timing of originally
anticipated cost reductions. Unisource does expect to achieve in fiscal 1997 the
full benefit of the projected $100 million net cost reductions resulting from
the completion of the restructuring. The restructuring reserve at March 31, 1995
is $85.2 million, which management continues to believe is adequate to complete
the restructuring plan.
<PAGE>
Financial Condition and Liquidity
---------------------------------
Debt, excluding finance subsidiaries, was $688 million at March 31,
1995, an increase of $243 million from the Company's debt balance at September
30, 1994 of $445 million. This increase in borrowing levels was primarily to
satisfy the Company's working capital and acquisition requirements. On December
1, 1994, the Company entered into a new credit agreement to borrow up to $500
million. This multi-currency facility replaced three other lines of credit
amounting to approximately $415 million. At the same time, the Company also
reduced the commitment under another agreement from $200 million to $100
million. The Company had a total of $600 million in bank credit commitments as
of March 31, 1995 of which $273 million were unused and available. At March 31,
1995, debt as a percentage of capitalization was 32.5% and the current ratio was
1.6 to 1.
On April 13, Erskine Limited, Alco's U.K. subsidiary, announced that it
had reached agreement on the terms of a recommended cash offer to acquire all of
the outstanding shares of Southern Business Group PLC, a publicly held U.K.
company. The offer price for the shares is approximately $130 million. Southern
sells, leases, services and remanufactures copiers and other office equipment in
Southern England.
The Company's change in cash from operating activities during the first
six months of fiscal 1995 primarily relates to working capital requirements.
Unisource's working capital primarily reflects the effects of substantial price
increases presently being experienced in the paper business along with the
increased sales volume. Changes relating to AOP primarily relate to inventory
resulting from both growth in the business along with supplier price increases.
The Company estimates that total cash expenditures in connection with
the Unisource restructuring plan will amount to $148 million. In addition to the
$52 million spent in fiscal 1994, $16 million was expended in the first half of
fiscal 1995, totaling $68 million spent to date. Unisource anticipates spending
an additional $37 million during the remainder of fiscal 1995.
Finance subsidiaries debt grew by $152 million from September 30, 1994,
a result of increased leasing activity. During the six months ended March 31,
1995, Alco Capital had issued an additional $203 million under its Medium Term
Notes Program which began in July 1994. At March 31, 1995, $308 million of the
$500 million available under this program was outstanding. Alco Capital under
its $125 million asset securitization agreement commenced in September 1994,
sold an additional $38 million in direct financing leases during the first half
of fiscal 1995, replacing those leases liquidated and leaving the total amount
of contracts sold unchanged.
The Company believes that its operating cash flow together with unused
lines of credit and other financing arrangements will be sufficient to finance
current operating requirements including capital expenditure, acquisition and
restructuring programs.
<PAGE>
PART II. OTHER INFORMATION
---------------------------
Item 6. Exhibits and Reports on Form 8-K
- -----------------------------------------
(a) The following Exhibits are furnished pursuant to Item 601 of
Regulation S-K:
Exhibit No. (11) Computation of Earnings Per Share
Exhibit No. (23) Consent of Ernst & Young LLP relating
to Registration Statement No. 33-52285
Exhibit No. (27) Financial Data Schedule
<PAGE>
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. This report has also been signed by the
undersigned in his capacity as the chief accounting officer of the Registrant.
ALCO STANDARD CORPORATION
Date May 4, 1995 /s/ Michael J. Dillon
--------------- ---------------------
Michael J. Dillon
Vice President and Controller
(Chief Accounting Officer)
<PAGE>
INDEX TO EXHIBITS
-----------------
Exhibit Number
- --------------
(11) Computation of Earnings Per Share
(23) Consent of Ernst & Young LLP relating to Registration
Statement No. 33-52285
(27) Financial Data Schedule
<PAGE>
EXHIBIT 11
- ----------
ALCO STANDARD CORPORATION
COMPUTATIONS OF EARNINGS PER SHARE
(IN THOUSANDS, EXCEPT EARNINGS PER SHARE)
<TABLE>
<CAPTION>
1995 1994
--------------------------- ---------------------------
FULLY FULLY
PRIMARY DILUTED(1) PRIMARY DILUTED(1)
--------- ---------- --------- ----------
<S> <C> <C> <C> <C>
THREE MONTHS ENDED MARCH 31
AVERAGE SHARES OUTSTANDING
Common shares 54,654 54,654 53,569 53,569
Preferred stock
Considered common equivalents 7 7
Senior Securities 4,508 4,508
Options 1,005 1,084 1,054 1,054
--------- ---------- --------- ----------
Total shares 55,659 60,246 54,630 59,138
========= ========== ========= ==========
INCOME
Net income $ 49,125 $ 49,125 $ 38,021 $ 38,021
Less: Preferred dividends 2,893 2,893
--------- ---------- --------- ----------
Income available to common shareholders $ 46,232 $ 49,125 $ 35,128 $ 38,021
========= ========== ========= ==========
EARNINGS PER SHARE $0.83 $0.82 $0.64 $0.64
========= ========== ========= ==========
SIX MONTHS ENDED MARCH 31
AVERAGE SHARES OUTSTANDING
- --------------------------
Common shares 54,594 54,594 50,774 50,774
Preferred stock
Considered common equivalents 9 9
Senior securities 4,508 4,508
Options 1,044 1,135 968 1,044
--------- ---------- --------- ----------
Total shares 55,638 60,237 51,751 56,335
========= ========== ========= ==========
INCOME
- ------
Net Income $ 94,594 $ 94,594 $ 69,875 $ 69,875
Less: Preferred dividends 5,786 5,786
--------- ---------- --------- ----------
Income available to common shareholders $ 88,808 $ 94,594 $ 64,089 $ 69,875
========= ========== ========= ==========
EARNINGS PER SHARE $1.60 $1.57 $1.24 $1.24
========= ========== ========= ==========
</TABLE>
(1) This calculation is submitted in accordance with Regulation S-K item 601 (b)
(11) although not required by footnote 2 to paragraph 14 of APB Opinion No.
15 because it results in dilution of less than 3%.
<PAGE>
Exhibit 23
Consent of Ernst & Young LLP, Independent Auditors
We consent to the incorporation by reference in the Registration Statement (Form
S-3 No. 33-52285) of Alco Standard Corporation and in the related Prospectus of
our report dated October 17, 1994, with respect to the consolidated financial
statements and schedules of Alco Standard Corporation incorporated by reference
in the Annual Report (Form 10-K) for the year ended September 30, 1994 (as
amended by the 10-K/A filed November 30, 1995).
ERNST & YOUNG LLP
November 29, 1994
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
consolidated financial statements of Alco Standard Corporation and subsidiaries
and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAR-31-1995
<PERIOD-START> SEP-30-1994
<PERIOD-END> MAR-31-1995
<CASH> $43,849,000
<SECURITIES> 0
<RECEIVABLES> 1,048,028,000
<ALLOWANCES> 34,305,000
<INVENTORY> 720,355,000
<CURRENT-ASSETS> 1,914,003,000
<PP&E> 676,851,000
<DEPRECIATION> 320,883,000
<TOTAL-ASSETS> 3,987,985,000<F2>
<CURRENT-LIABILITIES> 1,225,561,000
<BONDS> 441,321,000
<COMMON> 588,011,000
0
200,918,000<F1>
<OTHER-SE> 642,464,000
<TOTAL-LIABILITY-AND-EQUITY> 3,987,985,000<F3>
<SALES> 4,586,145,000
<TOTAL-REVENUES> 4,627,435,000
<CGS> 3,425,488,000
<TOTAL-COSTS> 3,442,085,000<F4>
<OTHER-EXPENSES> 1,001,930,000<F5>
<LOSS-PROVISION> 12,217,000
<INTEREST-EXPENSE> 26,997,000
<INCOME-PRETAX> 156,423,000
<INCOME-TAX> 61,829,000
<INCOME-CONTINUING> 94,594,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 94,594,000
<EPS-PRIMARY> 1.60
<EPS-DILUTED> 1.57
<FN>
<F1>(1) Redeemable solely at the Company's option.
<F2>(2) Includes Finance Subsidiaries assets (primarily lease receivables) of
$756,824,000
<F3>(3) Includes Finance Subsidiaries liabilities (primarily debt) of
$655,338,000
<F4>(4) Includes Finance Subsidiaries interest of $16,597,000
<F5>(5) Represents selling, general and administrative expenses.
</FN>
</TABLE>
