UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------------------
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
---
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
OR
___ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 1-483
------------------------------
MALLINCKRODT GROUP INC.
(Exact name of registrant as specified in its charter)
New York 36-1263901
(State or other jurisdiction (I.R.S. Employer
incorporation or organization) Identification No.)
7733 Forsyth Boulevard
St. Louis, Missouri 63105-1820
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 314-854-5200
---------------------------------
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 the latest practicable date. 74,158,200 shares excluding
12,958,089 treasury shares as of April 30, 1996.
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED).
The accompanying interim condensed consolidated financial statements of
Mallinckrodt Group Inc. (the Company or Mallinckrodt) do not include all
disclosures normally provided in annual financial statements. These financial
statements, which should be read in conjunction with the consolidated financial
statements contained in Mallinckrodt's 1995 Annual Report to Shareholders, are
unaudited but include all adjustments which Mallinckrodt's management considers
necessary for a fair presentation. These adjustments consist of normal
recurring accruals except as discussed in Notes 1 and 2 of the Notes to
Condensed Consolidated Financial Statements. Interim results are not
necessarily indicative of the results for the fiscal year. All references to
years are to fiscal years ended June 30 unless otherwise stated.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In millions except per share amounts)
Quarter Ended Nine Months Ended
March 31, March 31,
----------------- -------------------
1996 1995 1996 1995
------ ------ -------- --------
Net sales $572.6 $529.2 $1,592.9 $1,449.3
Operating costs and expenses:
Cost of goods sold 311.0 286.9 868.4 785.2
Selling, administrative and
general expenses 146.7 138.3 426.6 395.8
Research and development expenses 28.9 23.6 84.5 71.3
Other operating (income)
expense, net (2.0) .7 (9.4) (3.2)
------- ------- --------- ---------
Total operating costs and expenses 484.6 449.5 1,370.1 1,249.1
------- ------- --------- ---------
Operating earnings 88.0 79.7 222.8 200.2
Equity in pre-tax earnings of
joint venture 8.0 6.3 21.2 16.5
Interest and other nonoperating
expense, net (.8) (.2) (1.7) (1.0)
Interest expense (14.8) (17.7) (43.5) (41.5)
------- ------- --------- ---------
Earnings from continuing
operations before income taxes 80.4 68.1 198.8 174.2
Income tax provision 29.7 25.0 74.1 65.3
------- ------- --------- ---------
Earnings from continuing
operations 50.7 43.1 124.7 108.9
Discontinued operations (2.3) 3.9 20.2 11.8
------- ------- --------- ---------
Net earnings 48.4 47.0 144.9 120.7
Preferred stock dividends (.1) (.1) (.3) (.3)
------- ------- --------- ---------
Available for common shareholders $ 48.3 $ 46.9 $ 144.6 $ 120.4
======= ======= ========= =========
Earnings per common share:
Continuing operations $.67 $.56 $1.62 $1.41
Discontinued operations (.03) .05 .26 .15
----- ---- ----- -----
Net earnings $.64 $.61 $1.88 $1.56
===== ==== ===== =====
(See Notes to Condensed Consolidated Financial Statements on page 5.)
1
<PAGE>
CONDENSED CONSOLIDATED BALANCE SHEET
(In millions except share and per share amounts)
March 31, June 30,
1996 1995
--------- ---------
ASSETS
Current assets:
Cash and cash equivalents $ 86.4 $ 60.9
Trade receivables, less allowances of $12.8
at March 31 and $13.5 at June 30 425.5 392.5
Inventories 483.5 415.5
Net current assets of discontinued operations 15.8
Deferred income taxes 54.0 53.1
Other current assets 65.5 56.9
--------- ---------
Total current assets 1,114.9 994.7
Investments and long-term receivables,
less allowances of $13.1 at March 31
and $17.0 at June 30 156.4 165.5
Property, plant and equipment, net 1,023.0 978.0
Intangible assets 651.6 527.6
Net noncurrent assets of discontinued operations 26.6
Deferred income taxes .8 .7
--------- ---------
Total assets $2,946.7 $2,693.1
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term debt $ 243.5 $ 197.5
Accounts payable 177.4 182.8
Accrued liabilities 360.3 332.1
Income taxes payable 27.4 7.7
Deferred income taxes 2.0 2.7
--------- ---------
Total current liabilities 810.6 722.8
Long-term debt, less current maturities 592.7 501.5
Deferred income taxes 99.5 76.9
Postretirement benefits 152.7 142.7
Other noncurrent liabilities and deferred
credits 127.0 77.7
--------- ---------
Total liabilities 1,782.5 1,521.6
Shareholders' equity:
4 Percent cumulative preferred stock 11.0 11.0
Common stock, par value $1, authorized
300,000,000 shares; issued 87,116,289
shares as of March 31 and June 30 87.1 87.1
Capital in excess of par value 280.7 274.1
Reinvested earnings 1,095.3 984.5
Foreign currency translation (21.0) (9.3)
Treasury stock, at cost (288.9) (175.9)
--------- ---------
Total shareholders' equity 1,164.2 1,171.5
--------- ---------
Total liabilities and shareholders' equity $2,946.7 $2,693.1
========= =========
(See Notes to Condensed Consolidated Financial Statements on page 5.)
2
<PAGE>
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(In millions)
Nine Months Ended
March 31,
-----------------
1996 1995
------- ------
CASH FLOW - OPERATING ACTIVITIES
Net earnings $144.9 $120.7
Adjustments to reconcile net earnings
to net cash provided by operating activities:
Depreciation and amortization 107.2 88.1
Postretirement benefits 8.4 8.7
Undistributed equity in earnings of joint venture (16.1) (11.9)
Deferred income taxes 20.4 19.5
Gains on disposals of assets (53.4) (.8)
Other, net 36.2 58.2
------- -------
247.6 282.5
Changes in non-cash operating working capital:
Accounts receivable (39.3) (40.5)
Inventories (63.8) (36.5)
Accounts payable, accrued
liabilities and income taxes, net 18.7 (13.9)
Other, net (3.3) (4.2)
------- -------
Net cash provided by operating activities 159.9 187.4
CASH FLOWS - INVESTING ACTIVITIES
Capital expenditures (124.4) (111.7)
Acquisition spending (152.9) (99.2)
Proceeds from asset disposals 118.9 17.6
Other, net 25.9 (5.0)
------- -------
Net cash used by investing activities (132.5) (198.3)
CASH FLOWS - FINANCING ACTIVITIES
Increase in short-term debt 46.1 57.4
Proceeds from long-term debt 199.6 3.0
Payments on long-term debt (107.1) (15.3)
Issuance of Mallinckrodt common stock 24.1 4.1
Acquisition of treasury stock (130.5) (14.7)
Dividends paid (34.1) (31.3)
------- -------
Net cash provided (used) by financing activities (1.9) 3.2
------- -------
Increase (decrease) in cash and cash equivalents 25.5 (7.7)
Cash and cash equivalents at beginning of period 60.9 86.2
------- -------
Cash and cash equivalents at end of period $ 86.4 $ 78.5
======= =======
(See Notes to Condensed Consolidated Financial Statements on page 5.)
3
<PAGE>
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
(In millions except per share amounts)
1996 1995
--------- ---------
4 Percent cumulative preferred stock:
Balance at June 30 and March 31 $ 11.0 $ 11.0
Common stock:
Balance at June 30 and March 31 87.1 87.1
Capital in excess of par value:
Balance at June 30 274.1 268.2
Stock options exercised 6.6 .8
--------- ---------
Balance at March 31 280.7 269.0
Reinvested earnings:
Balance at June 30 984.5 846.4
Net earnings 144.9 120.7
Dividends:
4 Percent cumulative preferred stock ($3.00 per share) (.3) (.3)
Common stock ($.45 per share in 1996
and $.405 per share in 1995) (33.8) (31.0)
--------- --------
Balance at March 31 1,095.3 935.8
Foreign currency translation:
Balance at June 30 (9.3) (34.2)
Translation adjustment (11.7) 22.0
--------- --------
Balance at March 31 (21.0) (12.2)
Treasury stock:
Balance at June 30 (175.9) (162.6)
Purchase of common stock (130.5) (14.7)
Stock options exercised 17.5 3.3
Restricted stock awards (4.2)
--------- ---------
Balance at March 31 (288.9) (178.2)
--------- ---------
Total shareholders' equity $1,164.2 $1,112.5
========= =========
(See Notes to Condensed Consolidated Financial Statements on page 5.)
4
<PAGE>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Results for the nine months ended March 31, 1996 included a non-cash charge
for write-off of purchased research and development of $3.7 million, $2.3
million after taxes, or 3 cents per share, relating to Mallinckrodt
Veterinary's acquisition of Syntro Corporation. The charge was recorded as
research and development expenses.
2. Included in discontinued operations for the nine months ended March 31,
1996, are earnings, net of taxes, from the divested feed ingredients
business of $4.3 million. Corresponding amounts were $5.0 million and $14.5
million for the quarter and nine months ended March 31, 1995, respectively.
Other principal factors affecting discontinued operations were an after tax
gain of $34.2 million on the sale of the feed ingredients business and an
after tax provision for additional environmental costs of $15.6 million.
3. Provisions for income taxes were based on estimated annual effective tax
rates for each fiscal year. The Company's effective tax rate for the first
nine months was 37.3 percent, compared to last year's 37.5 percent. This
decrease reflects an earnings mix toward lower statutory tax rate
jurisdictions and the utilization of certain operating losses.
4. The Company is subject to various investigations, claims and legal
proceedings covering a wide range of matters that arise in the ordinary
course of its business activities. In addition, in connection with laws
and regulations pertaining to the protection of the environment, the
Company is a party to several environmental remediation investigations and
clean-ups and, along with other companies, has been named a "potentially
responsible party" for certain waste disposal sites. Each of these matters
is subject to various uncertainties, and it is possible that some of these
matters will be decided unfavorably against the Company. The Company has
established accruals for matters that are in its view probable and
reasonably estimable. Based on information presently available, management
believes that existing accruals are sufficient to satisfy any known
environmental liabilities. Further, any additional liability that may
ultimately result from the resolution of these maters is not expected to
have a material effect on Mallinckrodt's business, financial condition or
results of operations.
5. Earnings per common share were based on the weighted average number of
common and common equivalent shares outstanding (76,670,336 and 77,389,344
for the nine months ended March 31, 1996 and 1995, and 75,525,393 and
77,276,374 for the quarters ended March 31, 1996 and 1995, respectively).
6. The components of inventory include the following as of March 31, 1996:
(In millions)
Raw materials and supplies $160.6
Work in process 100.2
Finished goods 222.7
------
$483.5
======
7. As of March 31, 1996, the Company has authorized and issued 100,000 shares,
par value $100, 4 Percent cumulative preferred stock of which 98,330 shares
are outstanding. Mallinckrodt also has authorized 1,400,000 shares, par
value $1, of Series preferred stock, none of which is outstanding.
Shares included in treasury stock were:
March 31, June 30,
1996 1995
---------- --------------
Common stock 13,019,651 10,365,203
4 Percent cumulative preferred stock 1,670 1,670
5
<PAGE>
8. At March 31, 1996, common shares reserved were:
Exercise of common stock purchase rights 84,170,914
Exercise of stock options and granting of stock awards 10,074,276
----------
Total 94,245,190
==========
9. Supplemental cash flow information for the nine months ended March 31
included:
(In millions)
1996 1995
------ ------
Interest paid $35.6 $34.7
Income taxes paid $54.6 $40.8
Noncash investing and financing activities:
Assumption of liabilities related to acquisitions $21.7 $ 1.8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS [1]
RESULTS OF OPERATIONS
General
- -------
Earnings from continuing operations for the third quarter ended March 31, 1996
were $51 million, or 67 cents per share. This represents a 20 percent increase
over the comparable 56 cents per share for the prior year. Net sales for the
quarter were up 8 percent to $573 million, compared to $529 million a year ago.
Net earnings for the third quarter were $48 million, or 64 cents per share,
compared with $47 million, or 61 cents per share, during the same period a year
ago. Net earnings for the prior year third quarter include $5.0 million of
earnings, net of taxes, from the divested feed ingredients business.
For the nine months, earnings from continuing operations were $125 million, or
$1.62 per share, up 15 percent from the corresponding prior year per share
amount. These results reflect a non-cash charge of $3.7 million, $2.3 million
after taxes, or 3 cents per share, associated with the acquisition of Syntro
Corporation. Excluding this charge, earnings from continuing operations were
$1.65 per share, a 17 percent increase over the comparable $1.41 per share for
the prior year. Net sales for the nine months were up 10 percent to $1.6
billion, compared to $1.4 billion last year. Net earnings for the nine months
were $145 million, or $1.88 per share, compared with $121 million, or $1.56 per
share, last year. Fiscal 1996 net earnings include the gain resulting from the
sale of the feed ingredients business in the second quarter, partially offset by
a second quarter adjustment of provisions for environmental costs related to
discontinued operations. Also included in net earnings are earnings from the
divested feed ingredients business amounting to $4.3 million and $14.5 million,
net of taxes, for the nine months ended March 31, 1996 and March 31, 1995,
respectively.
- ------------------------
[1] The Private Securities Litigation Reform Act of 1995 provides a "safe
harbor" for forward-looking statements, so long as those statements are
identified as forward-looking and are accompanied by meaningful cautionary
statements identifying important factors that could cause actual results to
differ materially from those discussed in the statement. Certain statements
contained herein are forward-looking, particularly the statements appearing
under Part 1. Item 2. "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and Part II. Item 1. "Legal Proceedings."
Among the factors that could cause actual results to differ materially are the
following: the effect of business and economic conditions; constraints on
supplies of raw materials used in manufacturing certain of the Company's
products; capacity constraints limiting the production of certain products;
difficulties or delays in the development, production, testing and marketing of
products; difficulties or delays in receiving required governmental or
regulatory approvals; market acceptance issues, including the failure of
products to generate anticipated sales levels; the effects of, and changes in,
trade, monetary and fiscal policies, laws and regulations; foreign exchange
rates and fluctuations in those rates; the costs and effects of legal and
administrative proceedings, including the environmental proceedings involving
the Company; and the risk factors reported from time to time in the Company's
SEC reports.
6
<PAGE>
A comparison of sales and operating earnings follows:
(In millions) Quarter Ended Nine Months Ended
March 31, March 31,
------------- -------------------
1996 1995 1996 1995
---- ----- ------ -------
Sales
- -----
Mallinckrodt Chemical $190 $159 $ 510 $ 392
Mallinckrodt Medical 270 256 754 726
Mallinckrodt Veterinary 112 115 329 332
Intersegment sales 1 (1) (1)
---- ----- ------ -------
$573 $529 $1,593 $1,449
==== ===== ====== =======
Operating earnings
- ------------------
Mallinckrodt Chemical $ 24 $ 20 $ 48 $ 42
Mallinckrodt Medical 65 58 181 160
Mallinckrodt Veterinary 8 8 17 18
Corporate (9) (6) (23) (20)
----- ----- ------- -------
$ 88 $ 80 $ 223 $ 200
===== ===== ======= =======
Business Segments
- -----------------
MALLINCKRODT CHEMICAL
Net Sales Quarter Ended Nine Months Ended
(In millions) March 31, March 31,
------------- -------------------
1996 1995 1996 1995
---- ---- ---- ----
Catalyst, Performance & Lab Chemicals $109 $ 86 $307 $206
Pharmaceutical Specialties 81 73 203 186
---- ---- ---- ----
$190 $159 $510 $392
==== ==== ==== ====
Mallinckrodt Chemical's earnings were $32.3 million and $69.2 million for the
third quarter and nine months, respectively, representing increases of 21
percent and 18 percent over the same prior year periods. These results include
the equity in the earnings of Tastemaker, the Company's flavors joint venture,
of $8.0 million and $21.2 million for the quarter and nine months, respectively.
Corresponding prior year amounts for Tastemaker were $6.3 million for the
quarter and $16.5 million for the nine months. Net sales increased 19 percent
and 30 percent compared to the corresponding prior year quarter and nine months,
respectively. Catalyst, performance and lab chemicals sales increased 26
percent for the quarter and 49 percent for the nine months, primarily from the
acquisition of J.T. Baker in February 1995. Pharmaceutical specialties sales
increased by 12 percent and 9 percent for the quarter and nine months,
respectively. Continued strength in sales of medicinal narcotics and increased
acetaminophen (APAP) volume were the main contributors to the higher sales.
MALLINCKRODT MEDICAL
Net Sales Quarter Ended Nine Months Ended
(In millions) March 31, March 31,
------------- -------------------
1996 1995 1996 1995
---- ---- ---- ----
Imaging $183 $173 $511 $497
Anesthesiology & Critical Care 87 83 243 229
---- ---- ---- ----
$270 $256 $754 $726
==== ==== ==== ====
7
<PAGE>
Mallinckrodt Medical's operating earnings increased 12 percent for the quarter,
compared to the same prior year period, to $64.5 million and 13 percent for the
nine months to $181.1 million. Net sales improved 6 percent and 4 percent for
the quarter and nine months, respectively, compared to the corresponding prior
year periods. Sales volume improvements, dampened by competitive pricing,
characterized Medical's sales performance. Imaging sales for the quarter were 6
percent higher than the prior year and sales for the nine months were up 3
percent, primarily from the acquisition of Liebel-Flarsheim in January 1996.
Anesthesiology and critical care sales for the quarter and nine months increased
5 percent and 6 percent, respectively, driven largely by respiratory therapy
products. Productivity programs initiated during the last several years helped
earnings improve at a faster rate than sales.
MALLINCKRODT VETERINARY
Net Sales Quarter Ended Nine Months Ended
(In millions) March 31, March 31,
------------- -------------------
1996 1995 1996 1995
---- ---- ---- ----
Animal Health $112 $115 $329 $332
==== ==== ==== ====
Mallinckrodt Veterinary's operating earnings for the third quarter decreased 10
percent to $7.6 million due to adverse weather conditions and higher research
and development costs. Operating earnings for the nine months were $16.8
million, reflecting the same business influences as the second quarter.
Excluding a second quarter non-cash pre-tax charge of $3.7 million for write-off
of purchased research and development associated with the acquisition of Syntro
Corporation, nine months operating earnings improved 11 percent over the $18.4
million recorded last year. Net sales decreased 2 percent and 1 percent for the
quarter and nine months, respectively, compared to the corresponding prior year
periods. Higher third quarter sales volumes in Asia due to a new distribution
agreement were more than offset by volume declines throughout the rest of the
world. Sales for both comparative periods also reflect the exit of certain
Latin American distributorships last fiscal year.
Corporate Matters
- -----------------
Corporate expense increased $1.9 million for the quarter and $2.7 million for
the nine months compared to last year, primarily due to consulting expenses
associated with the strategic change initiative announced in December, 1995.
The effective tax rate for the nine months was 37.3 percent, compared to last
year's 37.5 percent. This decrease reflects an earnings mix toward lower
statutory tax rate jurisdictions and the utilization of certain operating
losses.
FINANCIAL CONDITION
The Company's financial resources are expected to continue to be adequate to
support existing businesses and fund new opportunities. Since June 30, 1995,
cash and cash equivalents increased $26 million. Operations provided $160
million of cash, while acquisition and capital spending totaled $277 million.
The Company's current ratio at March 31, 1996, was 1.4:1. Debt as a percentage
of invested capital was 42 percent.
The Company's Board of Directors previously authorized repurchase of a total of
42 million shares of its common stock. Thirty-three million shares have been
repurchased under this authorization, 3.5 million during the nine months ended
March 31, 1996.
In September 1995 and November 1995, the Company issued $100 million of 6.75%
notes due September 15, 2005, and $100 million of 6.5% notes due November 15,
2007, respectively, from the $250 million shelf registration statement filed in
February of 1995. As of March 31, 1996, $50 million of securities under this
shelf and $50 million of securities under a shelf registration statement filed
with the SEC in 1992 remain unissued.
The Company has a $550 million private-placement commercial paper program. This
program is backed by $550 million of U.S. lines of credit available until
November 1999. At March 31, 1996, commercial paper borrowings amounted to $196
million. There were no outstanding borrowings under the U.S. lines of credit at
March 31, 1996. At March 31, 1996, non-U.S. lines of credit totaling $218
million were also available and borrowings under these lines amounted to $39
million. The non-U.S. lines are cancellable at any time.
8
<PAGE>
Estimated capital spending for the year ending June 30, 1996, is approximately
$200 million.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
The Company is subject to various investigations, claims and legal proceedings
covering a wide range of matters that arise in the ordinary course of its
business activities. In addition, in connection with laws and regulations
pertaining to the protection of the environment, the Company is a party to
several environmental remediation investigations and clean-ups and, along with
other companies, has been named a "potentially responsible party" for certain
waste disposal sites. Each of these matters is subject to various
uncertainties, and it is possible that some of these matters will be decided
unfavorably against the Company. The Company has established accruals for
matters that are in its view probable and reasonably estimable. Based on
information presently available, management believes that existing accruals are
sufficient to satisfy any known environmental liabilities. Further, any
additional liability that may ultimately result from the resolution of these
matters is not expected to have a material effect on Mallinckrodt's business,
financial condition or results of operations.
Previously Reported Matters
- ---------------------------
The following is a discussion of material developments in proceedings previously
reported in the Company's Form 10-K for its fiscal year ended June 30, 1995, as
amended by the Company's reports on Form 10-Q for its fiscal quarters ended
September 30, 1995 and December 31, 1995:
Ashtabula County, Ohio -- The Company has accepted the previously described
buy-out settlement in this matter. Court approval of the settlement was
obtained in April 1996. The Company does not anticipate making any further
reports on this matter.
Pierce County, Washington -- The plaintiff in this matter, Centrum Properties,
Inc., has filed a motion for summary judgment; the Company's response is due in
May 1996. The Company is currently scheduling a meeting with the Washington
Department of Ecology to review proposed terms of an agreed order for clean-up
for the site.
Springville, Utah -- The Company has negotiated an interim settlement agreement
with Ensign-Bickford Industries, Inc., and Ensign Bickford Company to share
costs of remediating groundwater that allegedly has been impacted by nitrates
and explosive compounds emanating from an explosives plant in Springville, Utah.
ITEM 2. CHANGES IN SECURITIES.
Not applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
ITEM 5. OTHER INFORMATION
Not applicable.
9
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
4.6 Amended and Restated Rights Agreement dated as of February 19, 1996,
incorporated herein by reference to Exhibit 2 to Amendment to
Registration Statement on Form 8-A/A, dated February 26, 1996.
11.1 Primary earnings per share computation for the nine months ended
March 31, 1996 and 1995.
11.2 Fully diluted earnings per share computation for the nine months ended
March 31, 1996 and 1995.
11.3 Primary earnings per share computation for the quarters ended March
31, 1996 and 1995.
11.4 Fully diluted earnings per share computation for the quarters ended
March 31, 1996 and 1995.
27 Financial Data Schedule.
(b) Reports on Form 8-K.
During the quarter and through the date of this report, the following
reports on Form 8-K were filed.
- Report dated February 19, 1996, under Item 5 regarding the extension,
amendment and restatement of the Company's existing Rights Agreement
between the Company and First National Bank of Chicago.
- Report dated March 26, 1996, under Item 5 regarding the Premier
agreement.
- Report dated March 27, 1996, under Item 5 regarding presentation of
results of Phase 2 FS069 myocardial contrast echo at the American College
of Cardiology.
- Report dated April 1, 1996, under Item 5 regarding the completion of
Phase 3 clinical trial on ultrasound contrast agent, FS069.
* * * * * * * * * * * * * * * *
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
Mallinckrodt Group Inc.
_______________________________
Registrant
By: MICHAEL A. ROCCA By: WILLIAM B. STONE
____________________________ ______________________________
Michael A. Rocca William B. Stone
Senior Vice President and Vice President and Controller
Chief Financial Officer
Date: May 13, 1996
<PAGE>
<TABLE>
Exhibit 11.1
EARNINGS PER SHARE
PRIMARY COMPUTATION
($ in millions except share and per share amounts)
<CAPTION>
Nine Months Ended
March 31,
1996 1995
- --------------------------------------------------------------------
<S> <C> <C>
Basis for computation of earnings per
common and common equivalent shares:
Earnings from continuing operations $124.7 $108.9
Deduct dividends on 4 Percent
cumulative preferred stock (.3) (.3)
------- -------
Earnings from continuing operations
available to common shareholders 124.4 108.6
Discontinued operations 20.2 11.8
------- -------
Available for common shareholders $144.6 $120.4
======= =======
Number of shares:
Weighted average shares outstanding 75,508,512 76,681,341
Shares issuable upon exercise of
stock options, net of shares assumed
to be repurchased 1,161,824 708,003
---------- ----------
76,670,336 77,389,344
========== ==========
Earnings per common share:
Continuing operations $1.62 $1.41
Discontinued operations .26 .15
----- -----
Net earnings $1.88 $1.56
====== ======
</TABLE>
<PAGE>
<TABLE>
Exhibit 11.2
EARNINGS PER SHARE
FULLY DILUTED COMPUTATION
($ in millions except share and per share amounts)
<CAPTION>
Nine Months Ended
March 31,
1996 1995
- --------------------------------------------------------------------
<S> <C> <C>
Basis for computation of earnings per
common and common equivalent shares:
Earnings from continuing operations $124.7 $108.9
Deduct dividends on 4 Percent
cumulative preferred stock (.3) (.3)
------- -------
Earnings from continuing operations
available to common shareholders 124.4 108.6
Discontinued operations 20.2 11.8
------- -------
Available for common shareholders $144.6 $120.4
======= =======
Number of shares:
Weighted average shares outstanding 75,508,512 76,681,341
Shares issuable upon exercise of
stock options, net of shares assumed
to be repurchased 1,170,582 961,800
---------- ----------
76,679,094 77,643,141
========== ==========
Earnings per common share:
Continuing operations $1.62 $1.40
Discontinued operations .26 .15
----- -----
Net earnings $1.88 $1.55
===== =====
</TABLE>
<PAGE>
<TABLE>
Exhibit 11.3
EARNINGS PER SHARE
PRIMARY COMPUTATION
($ in millions except share and per share amounts)
<CAPTION>
Quarter Ended
March 31,
1996 1995
- ------------------------------------------------------------------------------------
<S> <C> <C>
Basis for computation of earnings per
common and common equivalent shares:
Earnings from continuing operations $ 50.7 $ 43.1
Deduct dividends on 4 Percent
cumulative preferred stock (.1) (.1)
------- -------
Earnings from continuing operations
available to common shareholders 50.6 43.0
Loss from discontinued operations (2.3) 3.9
------- -------
Available for common shareholders $ 48.3 $ 46.9
======= =======
Number of shares:
Weighted average shares outstanding 77,328,561 76,528,138
Shares issuable upon exercise of stock options,
net of shares assumed to be repurchased 1,196,832 748,236
---------- ----------
75,525,393 77,276,374
========== ==========
Earnings per common share:
Continuing operations $ .67 $ .56
Discontinued operations (.03) .05
------- -------
Net earnings $ .64 $ .61
======= =======
</TABLE>
<PAGE>
<TABLE>
Exhibit 11.4
EARNINGS PER SHARE
FULLY DILUTED COMPUTATION
($ in millions except share and per share amounts)
<CAPTION>
Quarter Ended
March 31,
1996 1995
- ------------------------------------------------------------------------------------
<S> <C> <C>
Basis for computation of earnings per
common and common equivalent shares:
Earnings from continuing operations $ 50.7 $ 43.1
Deduct dividends on 4 Percent
cumulative preferred stock (.1) (.1)
------- -------
Earnings from continuing operations
available to common shareholders 50.6 43.0
Discontinued operations (2.3) 3.9
------- -------
Available for common shareholders $ 48.3 $ 46.9
======= =======
Number of shares:
Weighted average shares outstanding 74,328,561 76,528,138
Shares issuable upon exercise of stock options,
net of shares assumed to be repurchased 1,170,581 961,800
---------- ----------
75,499,142 77,489,938
========== ==========
Earnings per common share:
Continuing operations $ .67 $ .56
Discontinued operations (.03) .05
------- -------
Net earnings $ .64 $ .61
======= =======
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
balance sheet and income statement, and is qualified in its entirety by
reference to such financial schedules.
</LEGEND>
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1996
<PERIOD-END> MAR-31-1996
<CASH> 86
<SECURITIES> 0
<RECEIVABLES> 438
<ALLOWANCES> 13
<INVENTORY> 484
<CURRENT-ASSETS> 1,115
<PP&E> 1,568
<DEPRECIATION> 545
<TOTAL-ASSETS> 2,947
<CURRENT-LIABILITIES> 811
<BONDS> 593
0
11
<COMMON> 87
<OTHER-SE> 1,066
<TOTAL-LIABILITY-AND-EQUITY> 2,947
<SALES> 1,593
<TOTAL-REVENUES> 1,593
<CGS> 868
<TOTAL-COSTS> 1,370
<OTHER-EXPENSES> 2
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 44
<INCOME-PRETAX> 199
<INCOME-TAX> 74
<INCOME-CONTINUING> 125
<DISCONTINUED> 20
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 145
<EPS-PRIMARY> 1.62
<EPS-DILUTED> 1.62
</TABLE>
