FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark one)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended June 30, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File Number 1-7159
FLORIDA ROCK INDUSTRIES, INC.
(exact name of registrant as specified in its charter)
Florida 59-0573002
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
155 East 21st Street, Jacksonville, Florida 32206
(Address of principal executive offices)
(Zip Code)
904/355-1781
(Registrant's telephone number, including area code)
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
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of August 1, 1995: 9,487,128 shares of $.10 par value
common stock.<PAGE>
FLORIDA ROCK INDUSTRIES, INC.
CONSOLIDATED CONDENSED BALANCE SHEET
(In thousands)
(Unaudited)
June 30, September 30,
1995 1994
ASSETS
Current assets:
Cash and cash equivalents $ 1,316 $ 804
Accounts and notes receivable, less
allowance for doubtful accounts of
$1,969 ($1,627 at September 30, 1994) 47,528 49,109
Inventories:
Finished products 17,245 16,329
Raw materials 3,549 3,249
Parts and supplies 1,178 1,037
Total inventories 21,972 20,615
Prepaid expenses and other 6,392 5,192
Total current assets 77,208 75,720
Other assets 27,624 26,794
Property, plant and equipment, at cost:
Land 107,349 105,345
Plant and equipment 380,756 358,250
488,105 463,595
Less accumulated depreciation,
depletion and amortization (266,601) (255,519)
Net property, plant and equipment 221,504 208,076
$ 326,336 $ 310,590
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term notes payable to banks $ 15,500 $ 6,700
Accounts payable 26,367 25,176
Dividends Payable 2,372 -
Accrued income taxes 2,982 2,218
Accrued liabilities 14,378 12,543
Long-term debt due within one year 3,858 2,661
Total current liabilities 65,457 49,298
Long-term debt 10,044 23,116
Deferred income taxes 29,947 30,441
Other accrued liabilities 17,062 15,645
Stockholders' equity:
Preferred stock, no par value;
10,000,000 shares authorized - -
Common stock, $.10 par value;
50,000,000 shares authorized,
9,487,309 shares issued 949 949
Capital in excess of par value 17,400 17,400
Retained earnings 185,482 173,743
Less cost of treasury stock, 181
shares (87 shares at September 30,
1994) (5) (2)
Total stockholders' equity 203,826 192,090
$ 326,336 $ 310,590
See accompanying notes.<PAGE>
FLORIDA ROCK INDUSTRIES, INC.
CONSOLIDATED CONDENSED STATEMENT OF INCOME
(Dollars in thousands except per share amounts)
(Unaudited)
Three Months ended Nine Months ended
June 30 June 30
1995 1994 1995 1994
Net sales $98,256 $95,598 $272,554 $238,499
Cost of sales 78,350 75,492 220,876 197,720
Gross profit 19,906 20,106 51,678 40,779
Selling, general and
administrative expense 8,751 8,842 25,785 23,906
Operating profit 11,155 11,264 25,893 16,873
Interest expense (625) (536) (1,601) (1,683)
Interest income 159 116 441 334
Other income, net 140 20 432 97
Income before income taxes 10,829 10,864 25,165 15,621
Provision for income taxes 3,736 3,806 8,682 5,387
Net income $ 7,093 $ 7,058 $16,483 $10,234
Per common share:
Income $.74 $.74 $1.73 $1.08
Cash dividends $.25 $.25 $.50 $.50
Weighted average number
of shares 9,533,333 9,492,660 9,526,356 9,478,275
See accompanying notes.<PAGE>
FLORIDA ROCK INDUSTRIES, INC.
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
NINE MONTHS ENDED JUNE 30, 1995 AND 1994
(In thousands)
(Unaudited)
1995 1994
Cash flows from operating activities:
Net income $16,483 $10,234
Adjustments to reconcile net income to net
cash provided from operating activities:
Depreciation, depletion and amortization 19,439 19,165
Net changes in operating assets and
liabilities:
(Increase) Decrease in accounts receivable 1,430 (7,686)
(Increase) Decrease in inventories (1,357) 508
(Increase) in prepaid expenses and other (637) (795)
Increase (Decrease) in accounts payable
and accrued liabilities 5,207 7,893
Decrease in deferred income taxes (1,058) (2,673)
Gain on disposition of property, plant and
equipment (659) (385)
Other, net (282) 282
Net cash provided from operating activities 38,566 26,543
Cash flows from investing activities:
Purchase of property, plant and equipment (32,440) (16,848)
Proceeds from the sale of property, plant and
equipment 952 552
Proceeds from the disposition of other assets 68 694
Additions to notes receivable - (57)
Collections of notes receivable 206 2,854
Additions to other assets (1,283) (1,034)
Net cash used in investing activities (32,497) (13,839)
Cash flows from financing activities:
Net increase in short-term debt 8,800 3,100
Repayment of debt (11,983) (16,018)
Exercise of employee stock options - 10
Repurchase of Company stock (2) (1)
Payment of dividends (2,372) (2,372)
Net cash used in financing activities (5,557) (15,281)
Net increase (decrease) in cash and
cash equivalents 512 (2,577)
Cash and cash equivalents at beginning of year 804 4,069
Cash and cash equivalents at end of period $ 1,316 $ 1,492
See accompanying notes.<PAGE>
FLORIDA ROCK INDUSTRIES, INC.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
JUNE 30, 1995
(Unaudited)
(1) Basis of Presentation
The accompanying consolidated condensed financial statements include the
accounts of the Company and its subsidiaries. These statements have been
prepared in accordance with generally accepted accounting principles for
interim financial information and the instructions to Form 10-Q and do
not include all the information and footnotes required by generally
accepted accounting principles for complete financial statements. In the
opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation of the results for
the interim period have been included. Operating results for the nine
months ended June 30, 1995, are not necessarily indicative of the results
that may be expected for the year ended September 30, 1995. The
accompanying consolidated financial statements and the information
included under the heading "Management's Discussion and Analysis" should
be read in conjunction with the consolidated financial statements and
related notes of Florida Rock Industries, Inc. for the year ended
September 30, 1994.
(2) Earnings Per Share
Earnings per share are based on the weighted average number of common
shares outstanding and common stock equivalents, where applicable, during
the periods. Fully diluted earnings per share are not reported because
their effect would have been less than 3% dilutive.
(3) Supplemental Disclosures of Cash Flow Information
Cash paid during the nine months ended June 30, 1995 and 1994 for certain
expense items are (in thousands):
1995 1994
Interest expense, net of
amount capitalized $1,722 $2,284
Income taxes $8,977 $6,873
The following schedule summarizes noncash investing and financing
activities for the nine months ended June 30, 1995 and 1994 for certain
items are (in thousands):
1995 1994
Additions to property, plant
and equipment from:
Exchanges $ 48 $ 269
Issuing debt $ 107 -
Issuing of common stock in
payment of note payable - $8,000
Additions to notes receivable
from the sale of property,
plant and equipment $ 440<PAGE>
(4) The Company and its subsidiaries are subject to legal proceedings
and claims arising out of their businesses that cover a wide range
of matters. Additional information concerning these matters is
presented in Note 12 to the consolidated financial statements
included in the Company's 1994 Annual Report to stockholders, in
Item 3 "Legal Proceedings" of the Company's Form 10-K for fiscal
1994, and in Part II, Item 1 "Legal Proceedings" of the Company's
Form 10-Q for the quarters ended December 31, 1994 and March 31,
1995 and of this Form 10-Q and such information is incorporated
herein by reference.
MANAGEMENT'S DISCUSSION AND ANALYSIS
Operating Results
For the third quarter of fiscal 1995 consolidated net sales
increased 3% from the same quarter last year. The increase in
sales was due to increased prices that were partially offset by
lower unit volumes due principally to lower demand from the
residential markets. Gross profit and gross profit margin for the
current quarter were down slightly as the impact of lower unit
volume and cost increases offset the price increases.
Selling, general and administrative expenses for the current
quarter were moderately lower due to the decrease in profit sharing
and incentive compensation that are linked to profitability.
For the first nine months of fiscal 1995 net sales increased 14%
from the same period last year. The increase was due principally
to increased volumes in the first six months coupled with increased
prices. Gross profit and gross profit margin were up due
principally to the sales increase and favorable leverage inherent
in the business when volumes increase.
Selling, general and administrative expense increased in the
current nine month period when compared with the same period last
year due primarily to increased sales and increased profit sharing
and profit based incentive programs.
Interest expense increased in the third quarter as compared to the
same quarter last year due to an increase in the average interest
rate which was offset by a decrease in the average debt
outstanding. The decrease in interest expense in the first nine
months of fiscal 1995 as compared to the same period last year was
due to a decrease in the average debt outstanding which was
substantially offset by an increase in the average interest rate.
<PAGE>
The slowing expected in the construction markets is taking place.
Commercial and multifamily construction continues to respond to
demand as much of the excess capacity has been absorbed in many of
the Company's markets. Residential construction has been declining
as increased interest rates have slowed demand. Infrastructure
programs continue to grow modestly.
Financial Condition
The Company continues to maintain its sound financial condition
with sufficient resources to meet anticipated capital expenditures
and other operating requirements.
While the Company is affected by environmental regulations, such
regulations are not expected to have a major effect on the
Company's capital expenditures or operating results. Additional
information concerning environmental and other matters is presented
in Note 12 to the consolidated financial statements included in the
Company's 1994 Annual Report to stockholders, in Part I, Item 3
"Legal Proceedings" of the Company's Form 10-K for fiscal 1994 and
in Part II, Item 1 "Legal Proceedings" of the Company's Form 10-Q
for the quarters ended December 31, 1994 and March 31, 1995 and of
this Form 10-Q, and such information is incorporated herein by
reference.
PART II OTHER INFORMATION
Item 1. Legal Proceedings
The Company has been advised of soil and groundwater contamination
on or near a site used by the Company as a concrete block
manufacturing facility in Kissimmee, Florida. The alleged
contamination by petroleum products apparently resulted from a
leaking underground storage tank on the site. The contaminated
soil and groundwater will have to be remediated in accordance with
state and federal laws. An environmental consulting firm is
investigating the site and has submitted a Contamination Assessment
Report ("CAR") to the Florida Department of Environmental
Protection ("DEP") for their review and approval. By letter dated
July 12, 1995, the DEP advised that additional site information was
needed before the CAR could be approved. The Company intends to
comply with the DEP request. Following DEP approval of the CAR, a
Remedial Action Plan will be developed and submitted to the DEP for
approval. The Company will seek reimbursement of site clean up
costs from the Florida Petroleum Liability Insurance and
Restoration Program and/or the Florida Abandoned Tank Restoration
Program. This matter was previously reported in the Form 10-K for
the year ending September 30, 1994.<PAGE>
A personal injury action was brought against the Company and CSX
Transportation, Inc. by Timothy Joe Cupp who was injured while
unloading aggregates from a railroad hopper car leased by the
Company. The case is styled Timothy Joe Cupp vs Florida Rock
Industries, Inc. and CSX Transportation, Inc., Case No. CV 294-54,
in the U.S. District Court for the Souther District of Georgia.
The complaint seeks compensatory damages in an unspecified amount
and punitive damages. A jury trial was held on June 12, 1995. The
jury awarded Plaintiff $10,000 in compensatory damages and no
punitive damages. Judgment was entered on July 6, 1995 and
Plaintiff has until August 5, 1995 to file a notice of appeal.
This case has been previously reported in the Form 10-K for the
year ending September 30, 1994.
Note 12 to the consolidated financial statements included in the
Company's 1994 Annual Report to stockholders, Item 3 "Legal
Proceedings" of the Company's Form 10-K for fiscal 1994 and Part
II, Item 1 "Legal Proceedings" of the Company's Form 10-Q for the
quarter ended December 31, 1994 are incorporated herein by
reference.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits. The response to this item is submitted as a
separate section entitled "Exhibit Index" starting on the next
page of this Form 10-Q.
(b) Reports on Form 8-K. There were no reports on Form 8-K filed
during the three months ended June 30, 1995.
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.
August 1, 1995 FLORIDA ROCK INDUSTRIES, INC.
RUGGLES B. CARLSON
Ruggles B. Carlson
Vice President-Finance
and Treasurer
(Principal Financial and
Accounting Officer)<PAGE>
FLORIDA ROCK INDUSTRIES, INC.
FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 1995
EXHIBIT INDEX
Page No. in
Sequential
Numbering
(2)(a) Agreement and Plan of Reorganization entered
into as of March 5, 1986 between the Company
and Florida Rock & Tank Lines, Inc. ("FRTL")
pursuant to the distribution pro rata to the
Company's stockholders of 100% of the
outstanding stock of FRTL has previously been
filed as Appendix I to the Company's Proxy
Statement dated June 11, 1986. File No. 1-
7159.
(3)(i)(a) Restated Articles of Incorporation of Florida
Rock Industries, Inc., filed with the
Secretary of State of Florida on May 9, 1986.
Previously filed with Form 10-Q for the
quarter ended December 31, 1986. File No. 1-
7159.
(3)(i)(b) Amendment to the Articles of Incorporation of
Florida Rock Industries, Inc. filed with the
Secretary of State of Florida on February 19,
1992. Previously filed with Form 10-K for the
fiscal year ended September 30, 1993. File
No. 1-7159.
(3)(ii)(a) Restated Bylaws of Florida Rock
Industries, Inc., adopted December 1, 1993.
Previously filed with Form 10-K for the fiscal
year ended September 30, 1993. File No. 1-
7159.
(3)(ii)(b) Amendment to the Bylaws of Florida Rock
Industries, Inc. adopted October 5, 1994.
Previously filed with Form 10-K for the fiscal
year ended September 30, 1994. File No. 1-
7159.
(4)(a) Articles III, VII, and XIII of the Articles of
Incorporation of Florida Rock Industries, Inc.
Previously filed with Form 10-Q for the
<PAGE>
Page No. in
Sequential
Numbering
quarter ended December 31, 1986 and Form 10-K
for the fiscal year ended September 30, 1993.
File No. 1-7159.
(4)(b) Amended and Restated Revolving Credit and Term
Loan Agreement dated as of December 5, 1990,
among Florida Rock Industries, Inc.;
Continental Bank, N.A.; Barnett Bank of
Jacksonville, N. A.; Sun Bank, National
Association; Crestar Bank; First Union
National Bank of Florida; The First National
Bank of Maryland; Southeast Bank, N. A.; and
Maryland National Bank. Previously filed with
Form 10-K for the fiscal year ended September
30, 1990. File No. 1-7159.
(4)(c) First Amendment dated as of September 30, 1992
to the Amended and Restated Revolving Credit
and Term Loan Agreement dated as of December
5, 1990. Previously filed with Form 10-K for
the fiscal year ended September 30, 1992.
File No. 1-7159.
(4)(d) Second Amendment dated as of June 30, 1994 to
the Amended and Restated Revolving Credit and
Term Loan Agreement dated as of December 5,
1990. Previously filed with Form 10-K for the
fiscal year ended September 30, 1994. File No.
1-7159.
(4)(e) The Company and its consolidated subsidiaries
have other long-term debt agreements which do
not exceed 10% of the total consolidated
assets of the Company and its subsidiaries,
and the Company agrees to furnish copies of
such agreements and constituent documents to
the Commission upon request.
(10)(a) Retirement Benefits Agreement between Florida
Rock Products Corporation and Thompson S.
Baker dated September 30, 1964. Previously
filed with Form S-1 dated June 29, 1972. File
No. 2-44839.
(10)(b) Retirement Benefits Agreement between Shands
& Baker, Inc., and Thompson S. Baker dated<PAGE>
Page No. in
Sequential
Numbering
September 30, 1964 and amendment thereto dated
September 22, 1970. Previously filed with
Form S-1 dated June 29, 1972. File No. 2-
44839.
(10)(c) Employment Agreement dated June 12, 1972
between Florida Rock Industries, Inc. and
Charles J. Shepherdson, Sr. and form of
Addendum thereto. Previously filed with Form
S-1 dated June 29, 1972. File No. 2-44839
(10)(d) Addendums dated April 3, 1974 and November 18,
1975 to Employment Agreement dated June 12,
1972 between Florida Rock Industries, Inc.,
and Charles J. Shepherdson, Sr. Previously
filed with Form 10-K for the fiscal year ended
September 30, 1975. File No. 1-7159.
(10)(e) Florida Rock Industries, Inc. 1981 Stock
Option Plan. Previously filed with Form S-8
dated March 3, 1982. File No. 2-76407.
(10)(f) Amended Medical Reimbursement Plan of Florida
Rock Industries, Inc., effective May 24, 1976.
Previously filed with Form 10-K for the fiscal
year ended September 30, 1980. File No. 1-
7159.
(10)(g) Amendment No. 1 to Amended Medical
Reimbursement Plan of Florida Rock Industries,
Inc. effective July 16, 1976. Previously
filed with Form 10-K for the fiscal year ended
September 30, 1980. File No. 1-7159
(10)(h) Tax Service Reimbursement Plan of Florida Rock
Industries, Inc. effective October 1, 1976.
Previously filed with Form 10-K for the fiscal
year ended September 30, 1980. File No. 1-
7159.
(10)(i) Amendment No. 1 to Tax Service Reimbursement
Plan of Florida Rock Industries, Inc.
Previously filed with Form 10-K for the fiscal
year ended September 30, 1981. File No. 1-
7159.<PAGE>
Page No. in
Sequential
Numbering
(10)(j) Amendment No. 2 to Tax Service Reimbursement
Plan of Florida Rock Industries, Inc.
Previously filed with Form 10-K for the fiscal
year ended September 30, 1985. File No. 1-
7159.
(10)(k) Summary of Management Incentive Compensation
Plan as amended effective October 1, 1992.
Previously filed with Form 10-K for the fiscal
year ended September 30, 1993. File No. 1-
7159.
(10)(l) Florida Rock Industries, Inc. Management
Security Plan. Previously filed with Form 10-
K for the fiscal year ended September 30,
1985. File No. 1-7159.
(10)(m) Various mining royalty agreements with FRTL or
its subsidiary, none of which are presently
believed to be material individually, but all
of which may be material in the aggregate.
Previously filed with Form 10-K for the fiscal
year ended September 30, 1986. File No. 1-
7159.
(10)(n) Florida Rock Industries, Inc. 1991 Stock
Option Plan. Previously filed with Form 10-K
for the fiscal year ended September 30, 1992.
File No. 107159.
(10)(o) Split Dollar Insurance Agreement dated January
24, 1994 between Edward L. Baker and Florida
Rock Industries, Inc. Previously filed with
Form 10-K for the fiscal year ended September
30, 1994. File No. 1-7159.
(10)(p) Split Dollar Insurance Agreement dated January
24, 1994 between John D. Baker II and Florida
Rock Industries, Inc. Previously filed with
Form 10-K for the fiscal year ended September
30, 1994. File No. 1-7159.
(11) Computation of Earnings Per Common Share.
(27) Financial Data Schedule <PAGE>
Exhibit (11)
FLORIDA ROCK INDUSTRIES, INC.
COMPUTATION OF EARNINGS PER COMMON SHARE
THREE MONTHS NINE MONTHS
ENDED JUNE 30 ENDED JUNE 30
1995 1994 1995 1994
Net income $7,093,000 $7,058,000 $16,483,000 $10,234,000
Common shares:
Weighted average shares
outstanding during the
period 9,487,128 9,486,767 9,487,168 9,437,613
Shares issuable under
stock options which are
potentially dillutive
and affect primary
earnings per share 46,205 5,893 39,188 40,662
Maximum potential shares
includable in computa-
tion of primary earnings
per share 9,533,333 9,492,660 9,526,356 9,478,275
Additional shares issu-
able under stock options
which are potentially
dillutive and affect
fully dilluted earnings
per share - - 5,150 -
Maximum potential shares
included in computation
of fully diluted
earnings per share 9,533,333 9,492,660 9,531,506 9,478,275
Primary earnings per
common share $.74 $.74 $1.73 $1.08
Fully diluted earnings
per common share (a) $.74 $.74 $1.73 $1.08
(a) Fully diluted earnings per common share are not presented on the
income statement since the potential effect would have been less
than 3% dilutive.
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<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1995
<PERIOD-END> JUN-30-1995
<CASH> 1,316
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<RECEIVABLES> 49,497
<ALLOWANCES> 1,969
<INVENTORY> 21,972
<CURRENT-ASSETS> 77,208
<PP&E> 488,105
<DEPRECIATION> 266,601
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<BONDS> 0
<COMMON> 949
0
0
<OTHER-SE> 202,877
<TOTAL-LIABILITY-AND-EQUITY> 326,366
<SALES> 272,554
<TOTAL-REVENUES> 272,554
<CGS> 220,876
<TOTAL-COSTS> 220,876
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