SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter ended December 31, 1994 Commission File Number 0-1437
THE FIRST REPUBLIC CORPORATION OF AMERICA
(Exact name of registrant as specified in its charter)
DELAWARE 13-1938454
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
302 Fifth Avenue, New York, N.Y. 10001
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code (212) 279-6100
Former name, former address and former fiscal year, if changed since last
report:
Indicate by checkmark whether the registrant (1) has filed all reports
required to be filed by Sections 13 and 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months and (2) has been subject to such
filing requirements for the past 90 days:
Yes X No
As of February 14, 1995 there were 673,720 shares of common stock
outstanding.
<PAGE>
PART I. FINANCIAL INFORMATION
THE FIRST REPUBLIC CORPORATION OF AMERICA
AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
December 31, June 30,
1994 1994
----------- ---------
(UNAUDITED) (SEE NOTE
BELOW)
Assets
Current Assets
Cash and Cash Equivalents $ 812,125 $ 1,316,144
Accounts Receivable 6,772,420 6,231,881
Inventories (Note 2) 4,964,175 4,731,545
Other Current Assets 2,696,081 1,695,785
----------- ----------
Total Current Assets 15,244,801 13,975,355
----------- ----------
Property, Plant and Equipment 72,768,293 69,431,186
Less: Accumulated Depreciation 31,597,598 29,276,551
----------- -----------
Net Properties 41,170,695 40,154,635
----------- -----------
Other Assets 27,292,124 26,033,638
----------- -----------
TOTAL ASSETS $ 83,707,620 $ 80,163,628
============ ============
Liabilities & Stockholders' Equity
- ----------------------------------
Current Liabilities $ 9,622,837 $ 9,412,274
------------ -----------
Long Term Debt 26,211,678 23,870,298
------------ -----------
Other Liabilities and Deferred Credits 4,655,178 4,617,340
------------ -----------
Stockholders' Equity:
Common Stock 1,175,261 1,175,261
Other Stockholders' Equity 42,042,666 41,088,455
----------- ----------
Total Stockholders' Equity 43,217,927 42,263,716
----------- ----------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 83,707,620 $ 80,163,628
============ ============
NOTE: The balance sheet at June 30, 1994
has been derived and condensed from
the audited financial statements at
that date.
SEE NOTES TO CONDENSED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
<PAGE>
THE FIRST REPUBLIC CORPORATION OF AMERICA
-----------------------------------------
AND SUBSIDIARIES
----------------
CONSOLIDATED STATEMENT OF OPERATIONS
------------------------------------
(UNAUDITED)
-----------
Six months ended Three months ended
December 31, December 31,
1994 1993 1994 1993
Revenues
Net Sales-Products $10,979,772 $11,397,939 $5,070,301 $4,732,567
Real Estate and
Hotel operations 10,768,820 10,759,769 5,426,589 5,717,351
Other 827,305 1,795,023 463,653 75,401
------------------------------------------------
Total Revenues 22,575,897 23,952,731 10,960,543 10,525,319
------------------------------------------------
Expenses
Cost of Sales 8,857,985 9,944,719 4,241,733 4,328,552
Operating-real estate
and hotel 4,961,074 5,068,084 2,520,416 2,650,143
Selling, general &
administrative 3,011,735 3,364,973 1,453,928 1,793,412
Depreciation and
amortization 1,833,499 1,844,929 909,943 875,750
Real estate taxes 1,311,941 1,388,119 641,862 788,617
Interest 1,442,188 1,170,932 740,510 594,531
----------- ---------- --------- ---------
Total Expenses 21,418,422 22,781,756 10,508,392 11,031,005
----------- ---------- ---------- ----------
Income(loss) before
income taxes, minority
interests and cumulative
effect of change in
accounting for
income taxes 1,157,475 1,170,975 452,151 (505,686)
Income taxes - Note 3 (322,000) (306,000) (105,000) 31,000
Minority interests 132,668 246,802 125,370 174,047
----------- ---------- --------- ---------
Income (loss) before
cumulative effect of
accounting change 968,143 1,111,777 472,521 (300,639)
Cumulative effect as of
July 1, 1993 of change
in method of accounting
for income taxes - Note 4 - 1,173,000 - -
--------- ----------- --------- ----------
Net Income (Loss) $ 968,143 $ 2,284,777 $ 472,521 $(300,639)
========= =========== ========= ==========
Earnings(loss) per share:
Income(loss) before
cumulative effect
of accounting change $ 1.44 $ 1.64 $ .70 $ (.44)
Cumulative effect of
accounting change - 1.74 - -
------ ------ ----- -------
Net Income(Loss) $ 1.44 $ 3.38 $ .70 $ (.44)
====== ====== ===== =======
Average shares outstanding 674,057 676,943 674,007 676,492
SEE NOTES TO CONDENSED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
<PAGE>
THE FIRST REPUBLIC CORPORATION OF AMERICA
-----------------------------------------
AND SUBSIDIARIES
----------------
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
----------------------------------------------
UNAUDITED
---------
Six Months ended
December 31,
1994 1993
---- ----
OPERATING ACTIVITIES
Net Income $ 968,143 $ 2,284,777
Adjustments to Reconcile Income to Net
Cash Provided by Operating Activities:
Depreciation and Amortization 1,833,499 1,844,929
Minority Interests' share of Loss in
Subsidiaries (132,668) (246,802)
Change in Method of Accounting for Income Taxes - (1,173,000)
Changes in Operating Assets and Liabilities
(Increase) Decrease in Accounts and
Other Receivables (920,539) 248,219
Increase in Inventories (232,630) (402,597)
Increase in Other Assets (1,000,296) (843,836)
Increase in Accounts Payable 1,310,563 272,750
Increase (Decrease) in Other Liabilities 37,838 (130,358)
---------- ----------
CASH PROVIDED BY OPERATIONS 1,863,910 1,854,082
---------- ----------
INVESTING ACTIVITIES
Purchases of Property Plant and Equipment (2,849,559) (1,755,396)
Investment in and Advances to Affiliated
Entities - Net (1,125,818) (700,000)
Payments Received on Mortgages Receivable 380,000 90,000
----------- ----------
NET CASH USED BY INVESTING ACTIVITIES (3,595,377) (2,365,396)
------------ ----------
FINANCING ACTIVITIES
Proceeds from Mortgages and Notes Payable-Net 2,400,000 756,399
Payments on Long Term Debt (1,158,620) (854,241)
Other Financing Activities (13,932) (161,388)
----------- ---------
NET CASH PROVIDED(USED) BY FINANCING ACTIVITIES 1,227,448 (259,230)
----------- ---------
DECREASE IN CASH AND CASH EQUIVALENTS (504,019) (770,554)
Cash and Cash Equivalents at
Beginning of Period 1,316,144 1,504,799
---------- ---------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 812,125 $ 734,255
========== ==========
SEE NOTES TO CONDENSED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
<PAGE>
THE FIRST REPUBLIC CORPORATION OF AMERICA
AND SUBSIDIARIES
NOTES TO CONDENSED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The condensed consolidated balance sheet as of December 31, 1994
and the consolidated statements of operations and cash flows for
the six month periods ended December 31, 1994 and 1993, have been
prepared by the Company, without audit. In the opinion of
management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position,
results of operations and cash flows at December 31, 1994 and for
all periods presented, have been made.
2. INVENTORIES
December 31, June 30,
1994 1994
Work-in process and ---- ----
raw materials $ 2,250,763 $ 1,978,575
Finished goods 2,713,412 2,752,970
----------- -----------
$ 4,964,175 $ 4,731,545
----------- -----------
3. INCOME TAXES
Six Months Ended
December 31,
1994 1993
---- ----
Federal $ 100,000 $ -
State 222,000 306,000
--------- ---------
$ 322,000 $ 306,000
--------- ---------
4. CHANGE IN METHOD OF ACCOUNTING FOR INCOME TAXES
Effective July 1, 1993, the Company adopted FASB Statement No. 109,
"Accounting for Income Taxes." Under Statement 109, the liability
method is used in accounting for income taxes. Under this method,
deferred tax assets and liabilities are determined based on
differences between financial reporting and tax bases of assets and
liabilities and are measured using the enacted tax rates and laws
that will be in effect when the differences are expected to
reverse. Prior to the adoption of Statement 109, income tax
expense was determined using the deferred method. Deferred tax
expense was based on items of income and expense that were reported
in different years in the financial statements and tax returns and
were measured at the tax rate in effect in the year the difference
originated. As permitted by Statement 109, the Company has elected
not to restate the financial statements of any prior years.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATION
(IN THOUSANDS)
Liquidity and Capital Resources
Working capital for the six months ended December 31, 1994
increased by approximately $1,059. Net cash provided by operating
activities was approximately $1,864. Net cash provided by
financing activities was approximately $1,227. Net cash of
approximately $3,595 was used for investing activities.
The Company has a $10,000 term loan and a $3,000 revolving line of
credit with its principal lender, collateralized by a mortgage on
the East Newark Industrial Center. At December 31, 1994, $1,700 is
outstanding under the line of credit. The term loan, which has an
outstanding balance of $8,444 at December 31, 1994, requires
monthly principal payments of $56 and matures on August 1, 1997
when the remaining unpaid principal balance of $6,667 will become
due. The revolving line, which is renewable annually, is due in
January 1996. The interest rate on both facilities is one percent
in excess of the lender's prime rate.
On November 30, 1994 the Company obtained a $3,500 mortgage loan
collateralized by the Jefferson National Bank building it owns in
Miami Beach, Florida. This loan bears interest at one percent in
excess of the lender's prime rate and provides for 78 payments of
$29 plus interest commencing January 1, 1995 and expiring June 1,
2001 when the remaining unpaid balance of $1,225 will become due.
Results of Operations
- ---------------------
Six months ended December 31, 1994 and 1993
-------------------------------------------
Income from operations before income taxes and minority interests
decreased $14. The components are as follows:
(Decrease)
1994 1993 Increase
---- ---- --------
Real Estate $ 2,468 $ 2,490 $ (22)
Hotel 223 307 (84)
Seafood (6) (646) 640
Textile 385 (271) 656
Corporate 1,913) (709) (1,204)
--------- -------- ----------
$ 1,157 $ 1,171 $ (14)
--------- -------- ----------
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATION - CONTINUED
(IN THOUSANDS)
REAL ESTATE
Revenues increased $148. While expenses increased $170 there
were no significant variations in any expense category.
HOTEL
Revenues decreased $138. Hotel earnings decreased $84 as a
result of the lower revenues.
SEAFOOD
Revenues decreased $394 in the current period. Earnings
increased $640 for the seafood division due primarily to increased
profits from sales of shrimp which resulted from higher operating
margins, and the recognition of approximately $100 of income from
the Company's scallop investment.
TEXTILES
Hanora Spinning's earnings increased $68 to $458 for the year
due to higher gross profits. Hanora South and J & M Dyers
recognized combined profits of $155 compared to last years loss of
$383 due to higher revenues and gross profits earned at J & M.
Whitlock Combing which sold its equipment and substantially ceased
operations in June 1992, incurred a loss of $228 in the current
period as compared to a loss of $278 last year. Overall, textile
revenues increased $229.
CORPORATE
Corporate, which includes the Giftware operations had an
expense of $1,913 as compared to last years expense of $709, the
difference is due substantially to income of $1,322 recognized last
year when the Company terminated a royalty agreement it had with
the purchaser of the Towle Silvermiths assets.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATION - CONTINUED
(IN THOUSANDS)
Three months ended December 31, 1994 and 1993
Income from operations before income taxes and minority interests
increased $958. The components are as follows:
(Decrease)
1994 1993 Increase
Real Estate $ 1,178 $ 1,366 $ (188)
Hotel 153 186 (33)
Seafood (285) (609) 324
Textile 246 (318) 564
Corporate (840) (1,131) 291
-------- --------- ----------
$ 452 $ (506) $ 958
-------- --------- ----------
REAL ESTATE
Revenues decreased $137. There were no significant variations
in any expense category.
HOTEL
Hotel earnings decreased $33, due to an approximately 10
percent decrease in revenues.
SEAFOOD
Earnings increased $324 primarily due to reduced losses from
shrimp operations in Ecuador of $260.
TEXTILES
Earnings increased $564. Hanora Spinning's earnings increased
$143. Hanora South and J & M Dyers recognized combined earnings of $102
as compared to last year's losses of $267 due substantially to increased
revenues of $546 and earnings of $303 at J & M Dyers as a result of a
substantial contract received from a new customer that expired in
December 1994. Whitlock Combing had a $52 decrease in losses due to the
closing of the wool combing plant in June 1992.
CORPORATE
Corporate losses decreased $291, due primarily to reduced
professional fees of $197.
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K.
Exhibits: None
Reports: There were no reports on Form 8-K filed
during the quarter ended December 31,
1994.
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.
The First Republic Corporation of America
-----------------------------------------
Registrant
Date: February 16, 1995 /s/ Norman A. Halper
-------------------------------
Norman A. Halper
President
Date: February 16, 1995 /s/ Harry Bergmann
-------------------------------
Harry Bergman
Treasurer
<PAGE>
The First Republic Corporation of America
and Subsidiaries
Article 5 FDS - 10-Q
At December 31, 1994 and for the six months then ended
December 31, 1994
Item Description
Cash and cash items $ 812,125
Marketable securities -
Notes and accounts receivable-trade 6,955,600
Allowances for doubtful accounts 183,180
Inventory 4,964,175
Total current assets 15,244,801
Property, plant and equipment 72,768,293
Accumulated depreciation 31,597,598
Total assets 83,707,620
Total current liabilities 9,622,837
Bonds, mortgages and similar debt 26,211,678
Preferred stock-mandatory redemption -
Preferred stock-no mandatory redemption -
Common stock 1, 175,261
Other stockholders' equity 42,042,666
Total liabilities and stockholders' equity 83,707,620
Net sales of tangible products 10,979,772
Total revenues 22,575,897
Cost of tangible goods sold 8,857,985
Total costs and expenses applicable to sales and revenues 11,088,249
Other costs and expenses -
Provision for doubtful accounts and notes 30,000
Interest and amortization of debt discount 1,442,188
Income before taxes and other items 1,157,475
Income tax expense 322,000
Income continuing operations 968,143
Discontinued operations -
Extraordinary items -
Cumulative effect-changes in accounting principles -
Net income or loss 968,143
Earnings per share-primary 1.44
Earnings per share-fully diluted 1.44
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The First Republic Corporation of America
and Subsidiaries
Article 5 FDS - 10-Q
At December 31, 1994 and for the six months ended
December 31, 1994
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1994
<PERIOD-START> JUL-01-1994
<PERIOD-END> DEC-31-1994
<CASH> 812
<SECURITIES> 0
<RECEIVABLES> 6956
<ALLOWANCES> 183
<INVENTORY> 4964
<CURRENT-ASSETS> 15245
<PP&E> 72768
<DEPRECIATION> 31598
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<CURRENT-LIABILITIES> 9623
<BONDS> 26212
<COMMON> 1175
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<OTHER-SE> 42043
<TOTAL-LIABILITY-AND-EQUITY> 83708
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