SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20579
_______________________
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) June 1, 1994
Doskocil Companies Incorporated
(Exact name of registrant as specified in its charter)
Delaware 0-7803 13-2535513
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
2601 Northwest Expressway, Suite 1000W, Oklahoma City, OK 73112
(Address of principal executive offices) (Zip Code)
(405)879-5500
Registrant's telephone number, including area code:
_________________________________________________________________
(Former name or former address, if changed since last report)
<PAGE>
Item 7. Financial Statements, Pro Forma Information and Exhibits
(a) Financial Statements of Business Acquired.
The balance sheet of the Frozen Specialty
Foods Division ("Frozen Specialty Foods") of International
Multifoods Corporation as of May 31, 1994 and November 27, 1993
and the related statements of operations and cash flows for the
six months ended May 31, 1994 and 1993 are attached hereto as
Exhibit 1 and are incorporated herein by reference.
(b) Pro Forma Financial Information.
The following pro forma condensed consolidated
statement of operations for the six months ended July 2, 1994,
has been prepared assuming the acquisition (the "Acquisition") of
Frozen Specialty Foods, which was consummated on June 1, 1994,
had been consummated on January 2, 1994. The pro forma condensed
consolidated statement of operations for the six months ended
July 2, 1994 includes the historical consolidated results of
operations of Doskocil Companies Incorporated (the "Company") for
the six months ended July 2, 1994 and the historical results of
Frozen Specialty Foods for the five months ended May 31, 1994.
The pro forma combined results of operations are not
necessarily indicative of results of operations that would have
resulted had the Acquisition actually occurred on January 2,
1994, nor are they necessarily indicative of future results of
operations.
(c) Exhibits
(1) Balance Sheet of the Frozen Specialty Foods
Business (a unit of the Prepared Foods Division of
International Multifoods Corporation) as of May
31, 1994 and November 27, 1993 and the related
statements of operations and cash flows for the
six months ended May 31, 1994 and 1993.
<PAGE>
<TABLE>
DOSKOCIL COMPANIES INCORPORATED
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share amounts)
<CAPTION>
Historical
____________________________________
Doskocil
Companies Frozen Specialty
Six months Foods
ended Five months ended Pro Forma Adjustments Pro Forma
July 2, 1994 May 31, 1994 Increase Decrease Combined
____________ _________________ ________ ________ _________
<S> <C> <C> <C> <C> <C>
Net sales $322,925 $78,914 $401,839
Cost of sales 265,518 56,905 854(a) 321,569
________ _______ ________
Gross profit 57,407 22,009 80,270
Selling expenses 34,831 15,974 50,805
General and
administrative
expenses 13,381 1,814 12(a) 15,183
Amortization of
intangible assets 3,244 677 836(b) 677(b) 4,080
________ _______ ________
Operating income 5,951 3,544 10,202
Other income (expense):
Interest and
financing costs (8,062) (7) 3,600(c) (11,669)
________ _______ ________
Other, net (312) (29) (341)
Income(loss) before
income taxes (2,423) 3,508 (1,808)
Income tax
benefit (expense) 1,164 (1,476) 1,157(d) 845
________ _______ ________
Income (loss) before
extraordinary item ($1,259) $ 2,032 $ (963)
======= ======= ========
Earnings (loss)
per share, before
extraordinary item $ (.16) $ (.12)
======= ========
<FN>
See notes to the Pro Forma Condensed Consolidated Statement of Operations
</TABLE>
<PAGE>
DOSKOCIL COMPANIES INCORPORATED
Notes to Pro Forma Condensed Consolidated
Statement of Operations
Note 1. Basis of Presentation
The pro forma condensed consolidated statement of
operations for the six months ended July 2, 1994, has been
prepared assuming the Acquisition had been consummated on
January 2, 1994, and includes the historical consolidated
results of operations of the Company for the six months
ended July 2, 1994, and the historical results of Frozen
Specialty Foods for the five months ended May 31, 1994. The
pro forma combined results of operations are not necessarily
indicative of results of operations that would have resulted
had the Acquisition actually occurred on January 2, 1994 nor
are they necessarily indicative of future results of
operations.
The pro forma combined statement of operations does not
give effect to the $1 million extraordinary net loss
resulting from the consummation of a new bank term loan and
revolving line of credit and related early extinguishment of
the existing revolving line of credit.
Note 2. Pro Forma Adjustments
(a) To record the net change in depreciation expenses based
on the fair value of depreciable assets, versus their
historical cost, using the straight line method over
their estimated useful lives.
(b) To record amortization of trademarks over 25 years and
goodwill over a period of 40 years, and eliminate
amortization of the historical goodwill of Frozen
Specialty Foods.
(c) To record additional interest attributable to the
increase in bank debt to finance the Acquisition,
record amortization of debt issue costs over the term
of the new bank debt and eliminate amortization of debt
issue costs attributable to debt which was
extinguished.
(d) To record the tax benefit attributable to the net pro
forma adjustments based on the statutory (federal and
state) tax rate of 40%. The effective tax rate in
future years is expected to be in excess of the
statutory rate due to non-deductible amortization of
previously recorded intangible assets.
(e) The weighted average number of common and common
equivalent shares used in the pro forma earnings per
share computation were 7,921,000 (historical).
<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 hereunto duly authorized.
DOSKOCIL COMPANIES INCORPORATED
By:/s/ William L. Brady
William L. Brady
Vice President and Controller
Dated: August 18, 1994
<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
1 Balance Sheet of the Frozen Specialty Foods
Business (a unit of the Prepared Foods Division of
International Multifoods Corporation) as of May
31, 1994 and November 27, 1993 and the related
statements of operations and cash flows for the
six months ended May 31, 1994 and 1993.
EXHIBIT 1
<TABLE>
FROZEN SPECIALTY FOODS BUSINESS
(A UNIT OF THE PREPARED FOODS DIVISION
OF INTERNATIONAL MULTIFOODS CORPORATION)
Condensed Balance Sheets
(In thousands)
<CAPTION>
May 31, November 27,
ASSETS 1994 1993
___________ ____________
(Unaudited)
<S> <C> <C>
Current assets:
Cash $ 5 $ 5
Trade accounts receivable, net 9,521 9,401
Inventories 22,375 23,083
Other current assets 370 2,450
________ ________
Total current assets 32,271 34,939
Property, plant and equipment, net 43,598 45,284
Intangibles, net - 29,820
________ ________
Total assets $ 75,869 $110,043
======== ========
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND INVESTMENT AND ADVANCES BY PARENT
<S> <C> <C>
Current liabilities:
Current portion of long-term debt $ 172 $ 171
Accounts payable 5,234 5,429
Accrued expenses 5,076 7,576
________ ________
Total current liabilities 10,482 13,176
Long-term debt, net of current portion - 172
Deferred income taxes - 9,807
Employee benefits and other non-current
liabilities - 6,221
________ ________
Total liabilities 10,482 29,376
________ ________
Investment and advances by parent 65,387 80,667
________ ________
Total liabilities and investment and
advances by parent $ 75,869 $110,043
======== ========
<FN>
See accompanying notes to condensed financial statements.
</TABLE>
<PAGE>
<TABLE>
FROZEN SPECIALTY FOODS BUSINESS
(A UNIT OF THE PREPARED FOODS DIVISION
OF INTERNATIONAL MULTIFOODS CORPORATION)
Condensed Statements of Earnings - Unaudited
(In thousands)
<CAPTION>
Three Months Ended Six Months Ended
__________________ ________________
May 31, May 31, May 31, May 31,
1994 1993 1994 1993
_______ _______ _______ _______
<S> <C> <C> <C> <C>
Net sales $46,327 $45,574 $92,774 $90,575
Cost of sales 34,799 32,528 66,973 65,534
_______ _______ _______ _______
Gross profit 11,528 13,046 25,801 25,041
Selling expenses 9,192 8,977 18,462 16,109
General and administrative
expenses 1,301 1,495 2,215 3,072
Amortization of intangibles 408 408 811 818
Other income 41 (9) 10 (29)
Interest expense 4 7 8 14
_______ _______ _______ _______
Earnings before income taxes 582 2,168 4,295 5,057
Income taxes 245 913 1,807 2,057
_______ _______ _______ _______
Net earnings $ 337 $ 1,255 $ 2,488 $ 3,000
======= ======= ======= =======
<FN>
See accompanying notes to condensed financial statements.
</TABLE>
<PAGE>
<TABLE>
FROZEN SPECIALTY FOODS BUSINESS
(A UNIT OF THE PREPARED FOODS DIVISION
OF INTERNATIONAL MULTIFOODS CORPORATION)
Condensed Statements of Cash Flows - Unaudited
(In thousands)
<CAPTION>
Six Months Ended
____________________
May 31, May 31,
1994 1993
_______ _______
<S> <C> <C>
Cash flows from operations:
Net earnings $ 2,488 $ 3,000
Adjustments to reconcile net earnings
to net cash flows from operations:
Depreciation and amortization 3,394 3,465
Deferred income tax expense 145 315
Loss on property disposals 24 (94)
Changes in operating assets and
liabilities:
(Increase) decrease in accounts
receivable (120) 724
(Increase) decrease in inventories 708 (478)
(Increase) decrease in other current
assets 245 (1,015)
Increase (decrease) in accounts payable (195) (2,266)
Increase (decrease) in accrued expenses (798) 3,404
Increase (decrease) in employee benefits
and other non-current liabilities - (559)
_______ _______
Net cash flows provided by operations 5,891 6,496
_______ _______
Cash flows from investing activities:
Capital expenditures (921) (1,088)
_______ _______
Net cash flows used for investing (921) (1,088)
_______ _______
Cash flows from financing activities:
Decrease in intercompany account (4,799) (4,830)
Payments on long-term debt (171) (578)
_______ _______
Net cash flows used for financing (4,970) (5,408)
_______ _______
Increase (decrease) in cash - -
Cash at beginning of period 5 4
_______ _______
Cash at end of period $ 5 $ 4
======= =======
<FN>
See accompanying notes to condensed financial statements.
</TABLE>
<PAGE>
FROZEN SPECIALTY FOODS BUSINESS
(A UNIT OF THE PREPARED FOODS DIVISION
OF INTERNATIONAL MULTIFOODS CORPORATION)
Notes to Condensed Financial Statements - Unaudited
May 31, 1994 and 1993
(In thousands)
(1) Summary of Significant Accounting Policies
General Information and Basis of Presentation
Frozen Specialty Foods Business ("Frozen Specialty" or the
"Company") is a unit of the Prepared Foods Business Division
(the "Division") of International Multifoods Corporation
("Multifoods" or the "Corporation"). Frozen Specialty is a
nationwide processor of prepared frozen foods products for
the United States foodservice and consumer markets.
The accompanying condensed financial statements have been
prepared without audit. The Balance Sheet at November 27,
1993, has been derived from audited financial statements as
of November 27, 1993 and for the nine months then ended. In
the opinion of the Company, the accompanying unaudited
condensed financial statements contain all adjustments
(adjustments are of a normal, recurring nature) necessary
for a fair presentation of the financial position as of May
31, 1994, and the results of operations and cash flows for
the three months and six months ended May 31, 1994 and 1993.
The accompanying financial statements do not necessarily
reflect the financial position and results of operations of
Frozen Specialty in the future, or what the financial
position and results of operations would have been had it
been an independent entity during the periods presented.
The financial statements should be read in conjunction with
the Company's audited financial statements as of November
27, 1993 and for the nine months then ended.
<PAGE>
FROZEN SPECIALTY FOODS BUSINESS
(A UNIT OF THE PREPARED FOODS DIVISION
OF INTERNATIONAL MULTIFOODS CORPORATION)
Notes to Condensed Financial Statements - Unaudited
(2) Inventories
Inventories at May 31, 1994 and November 27, 1993 are
summarized as follows:
May 31, November 27,
1994 1993
_______ ____________
Raw materials $ 4,616 $ 4,283
Finished and in-process goods 14,901 15,745
Packaging and supplies 2,858 3,055
_______ _______
Total inventories $22,375 $23,083
======= =======
(3) Related Party Transactions
Transactions with Multifoods includes certain disbursements
by Multifoods made on behalf of Frozen Specialty and charges
for certain operating expenses.
Expenses are charged based upon the specific identification
of applicable costs, and in certain instances, a
proportional cost allocation. Management believes that the
basis of all such charges is reasonable. The amount of
operating expenses charged by Multifoods to Frozen Specialty
are as follows:
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
__________________ ________________
May 31, May 31, May 31, May 31,
1994 1993 1994 1993
_______ _______ _______ _______
<S> <C> <C> <C> <C>
Cost of sales $599 $ 969 $1,049 $1,484
Selling expenses - 417 180 586
General and administrative - 201 120 319
____ ______ ______ ______
$599 $1,587 $1,349 $2,389
==== ====== ====== ======
</TABLE>
Sales to and purchases from other Multifoods business units
amounted to the following for each period presented:
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
__________________ _________________
May 31, May 31, May 31, May 31,
1994 1993 1994 1993
_______ _______ _______ _______
<S> <C> <C> <C> <C>
Sales $855 $1,146 $1,596 $1,888
==== ====== ====== ======
Purchases $203 $ 375 $ 340 $ 566
==== ====== ====== ======
</TABLE>
(4) Income Taxes
The Company files a consolidated federal income tax return
with Multifoods and is allocated a federal tax provision as
if the Company filed a separate return. The state tax
provision is allocated by applying a weighted-average state
tax rate to the Company's federal taxable income.
Additional tax provision items pertaining to the Company are
maintained in the Multifoods financial statements.
<TABLE>
Income tax expense was allocated as follows:
<CAPTION>
Three Months Ended Six Months Ended
__________________ _________________
May 31, May 31, May 31, May 31,
1994 1993 1994 1993
_______ _______ _______ _______
<S> <C> <C> <C> <C>
Current:
Federal $187 $597 $1,379 $1,345
State 38 122 280 275
____ ____ ______ ______
$225 $719 $1,659 $1,620
==== ==== ====== ======
Deferred:
Federal $ 18 $172 $ 137 $ 388
State 2 22 11 49
____ ____ ______ ______
$ 20 $194 $ 148 $ 437
==== ==== ====== ======
</TABLE>
Deferred income tax expense reflects the impact of temporary
differences between amounts of assets and liabilities for
financial reporting purposes and such amounts as measured by
currently enacted tax laws.
(5) Subsequent Event
On June 1, 1994, Multifoods sold all the outstanding stock
of Frozen Specialty to Doskocil Companies Incorporated
("Doskocil") for approximately $135.8 million in cash and
the assumption by Doskocil of approximately $10.5 million of
liabilities. Prior to the sale, all intangible assets,
deferred income taxes and other liabilities not assumed by
Doskocil were transferred from Frozen Specialty to
Multifoods through the Investment and advances by
parent account.
