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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):
July 21, 1999
AMERICAN BUSINESS PRODUCTS, INC.
(Exact name of registrant as specified in its charter)
GEORGIA 1-7088 58-1030529
(State of (Commission File No.) (I.R.S. Employer
incorporation) Identification No.)
2100 RIVEREDGE PARKWAY, SUITE 1200
ATLANTA, GEORGIA 30328
(Address of principal executive offices, including zip code)
(770) 953-8300
(Registrant's telephone number, including area code)
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ITEM 5. OTHER EVENTS.
On July 21, 1999, the Registrant announced that Larry Gellerstedt,
Chairman and Chief Executive Officer, will take a temporary leave of
absence to care for a medical condition.
Details are contained in the Press Release, issued July 21, 1999 filed
as Exhibit 99 hereto and incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits:
The following exhibit is filed herewith:
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EXHIBIT NO. DESCRIPTION
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99 Press Release, issued July 21, 1999 (without
financial statements)
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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, thereunto duly authorized.
AMERICAN BUSINESS PRODUCTS, INC.
Dated: July 26, 1999 /s/ Richard G. Smith
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Vice President and Chief Financial Officer
2
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EXHIBIT INDEX
The following exhibits are filed as part of this Report.
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EXHIBIT NO. DESCRIPTION PAGE NO.
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99 Press Release, issued July 21, 1999
(without financial statements)
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EXHIBIT 99
AMERICAN BUSINESS PRODUCTS, INC.
POST OFFICE BOX 105684 ATLANTA, GEORGIA 30348
(770) 953-8300 FAX (770) 952-2343
Contact:
Richard G. Smith
Financial Officer
American Business Products
(770) 953-8300
FOR IMMEDIATE RELEASE
Investors: Robert P. Jones/Theresa Schillero
Media Contact: Eileen King/Stacey Reed
Morgen-Walke Associates, Inc.
(212) 850-5600
AMERICAN BUSINESS PRODUCTS ANNOUNCES SECOND QUARTER RESULTS
- Chairman and CEO to Take Temporary Leave of Absence -
Atlanta, GA, July 21, 1999 - American Business Products (NYSE:ABP)
today announced financial results for the second quarter ended June 30, 1999.
Total revenues from continuing operations for the second quarter were
up slightly to $116.7 million compared to $113.3 million in the same quarter
last year. Net income from continuing operations for the quarter was $4.6
million, or $0.31 per diluted share. In the second quarter of 1998, the Company
reported pro forma net income from continuing operations of $6.1 million, or
$0.38 per diluted share.
The Company stated that the revenue increase is attributable to higher
sales in its specialty packaging business, accounting for 62% of revenue,
partially offset by the printed office products business which continues to be
in a period of transition as the Company implements revenue generating
initiatives. The Company also stated that the revenue decline at its printed
office products business resulted in lower than anticipated earnings in the
quarter.
Larry Gellerstedt, Chairman and Chief Executive commented, "We are very
pleased with the progress we made during the second quarter. In our specialty
packaging business, which includes soft packaging, labels and extrusion coating,
we experienced an increased demand for core products to both our new e-commerce
and silicone coating customers and many of our traditional clients. More
- more -
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importantly, the initiatives we have taken to grow the top line at our printed
office products business resulted in a slow down in the revenue decline for the
third consecutive quarter."
He added, "We are encouraged by these results and remain committed to
making the investments necessary to strengthen our specialty packaging business.
We will also continue to focus on programs to increase revenues through improved
sales force effectiveness, national account development, and core product sales
at our printed office products business."
For the six month period ended June 30, 1999, the Company reported
total revenues from continuing operations of $228.7 million compared to $232.4
million in the same period last year. Revenue in the specialty packaging
business grew to $146.8 million from $141.3 million in the first half of 1998.
In the printed office products business, the Company reported revenue of $88.4
million over $97.4 million in the comparable period last year. Net income from
continuing operations was $9.4 million, or $0.62 per diluted share, for the
first six months of 1999 compared to pro forma net income from continuing
operations of $12.8 million, or $0.78 per diluted share, in the same period in
1998.
Separately, the Company announced that, effective immediately, Larry
Gellerstedt, Chairman and Chief Executive Officer, will take a temporary leave
of absence to care for a medical condition. "On the advice of my doctors, I have
asked the Board for a three-month leave of absence. My condition is treatable
and not life threatening, and I expect to return full time to my
responsibilities as Chairman and CEO," said Mr. Gellerstedt.
The Board of Directors has authorized its Executive Committee to
oversee the operations and strategic direction of the Company in Mr.
Gellerstedt's absence. This Committee is comprised of Daniel W. McGlaughlin, G.
Harold Northrop, and W. Stell Huie. Mr. McGlaughlin is the former President and
CEO of Equifax, Inc. (NYSE:EFX) and current Chairman of S2 Corporation, Mr.
Northrop was previously President and CEO of Callaway Gardens, and Mr. Huie is
Senior Counsel of the law firm Long Aldridge & Norman LLP.
Mr. McGlaughlin stated, "Since joining ABP last year, Larry's main
objective has been to leverage the Company's strengths - focusing on our core
specialty packaging and printing capabilities and selling our non-core assets.
Larry undertook these efforts with the full support of the Board of Directors,
and has made great strides in that time. We are confident that the strong
management team that Larry has built will continue to implement the Company's
strategic plan. Larry has the Board's full support, and we look forward to his
return."
- more -
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The Company also stated that it had repurchased approximately 500,000
shares of its common stock in the first half of 1999 and approximately 1.6
million shares since the inception of the plan in December 1997. Under its
repurchase program, American Business Products is authorized to purchase 3.7
million shares, or approximately 23% of the common stock outstanding at the
inception of the program.
On June 1, the Company completed the sale of BookCrafters USA, its book
manufacturing business, and reported breakeven results for the discontinued
operation for the quarter.
American Business Products, Inc. is a leading supplier of specialty
packaging and printed office products. ABP's specialty packaging companies
include: Jen-Coat, Inc., a leader in extrusion coating and laminating of
packaging and other products; International Envelope Company, the world's
largest converter of Tyvek(R) mailers and other soft packages; and Discount
Labels, Inc., the largest short-run custom label producer in the U.S. ABP's
printed office products business, Curtis 1000 Inc., is a leader in
direct-to-user marketing of custom-printed envelopes and labels, digital
document services and business forms. Information on American Business Products
can be found on the Company's website at www.goabp.com.
This press release contains certain forward-looking statements, including
statements relating to the future financial results of the Company. Caution
should be taken in relying upon forward-looking statements in this release
because they involve a number of risks and uncertainties that could cause actual
results to differ materially from any such statements. These risks and
uncertainties include the Company's ability to successfully implement its
revenue enhancement strategies in its Printed Office Products business, develop
and implement strategic initiatives and new products in its Specialty Packaging
business, penetrate new distribution channels, and implement its Specialty
Packaging acquisition strategy. Additional risk factors are detailed in the
Company's periodic filings with the Securities and Exchange Commission,
including those risks identified in the section captioned, "Management's
Discussion and Analysis of Financial Condition and Results of Operations" in the
Company's annual report on Form 10-K for the year ended December 31, 1998, and
its quarterly report on Form 10-Q for the quarter ended March 31, 1999, which
discussion is incorporated in this release by reference.
(TABLES TO FOLLOW)
