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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: January 9, 1998 (December 17, 1997)
Commission file number 1-11803
AMERICAN PAD & PAPER COMPANY
(Exact name of registrant as specified in its charter)
Delaware 04-3164298
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
17304 Preston Road, Suite 700, Dallas, TX 75252-5613
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (972) 733-6200
Commission file number 333-3006
AMERICAN PAD & PAPER COMPANY OF DELAWARE, INC.
(Exact name of registrant as specified in its charter)
Delaware 25-1512956
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
17304 Preston Road, Suite 700, Dallas, TX 75252-5613
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (972) 733-6200
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Item 5. Other Events.
On December 17, 1997, American Pad & Paper Company (the "Company") issued a
press release stating that, based on preliminary estimates, it expects to
report a net loss per share of approximately $0.46 - $0.50 for the fourth
quarter ended December 31, 1997 and a corresponding net loss of $0.06 - $0.10
for the full year. The Company also announced that Gregory M. Benson, who
served as the Company's Chief Financial Officer from 1992 through 1996, has
agreed at the request of the Board of Directors ("Board"), to resume that
position on an interim basis until a replacement is named for Kevin McAleer,
who resigned on October 31, 1997. Mr. Benson will continue to serve as a
member of the Board. That press release is incorporated herein as Exhibit
99.1.
Exhibit
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99.1 Press release by the Company dated December 17, 1997.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrants have duly caused this report to be signed on their behalf by the
undersigned hereunto duly authorized.
American Pad & Paper Company
American Pad & Paper Company of Delaware, Inc.
/s/ William W. Solomon, Jr. January 9, 1998
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William W. Solomon, Jr. Date
Chief Accounting Officer
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Exhibit 99.1
CONTACT: Gregory Benson
American Pad & Paper Co.
(972) 733-5421
FOR IMMEDIATE RELEASE
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Robert P. Jones/Stacy Lipschitz
Stan Froelich - Press
Morgen-Walke Associates
(212) 850-5600
AMERICAN PAD AND PAPER COMPANY
COMMENTS ON ESTIMATED FOURTH QUARTER EARNINGS
-ANNOUNCES THAT GREGORY BENSON WILL SERVE AS INTERIM CFO-
DALLAS, Texas, December 17, 1997 -- Based on preliminary estimates, American
Pad & Paper Company (NYSE:AGP) said today that it expects to report a net loss
per share of approximately $0.46 - $0.50 for the fourth quarter ended December
31, 1997 and a corresponding net loss per share of approximately $0.06 - $0.10
for the full year.
Fourth quarter results will be negatively impacted by the recording of
accounting charges aggregating approximately $11.6 million (after-tax),
including a $5.9 million (after-tax) charge to increase the Company's LIFO
reserve to reflect the anticipated impact of the three paper price increases
that were implemented during 1997. Other charges relate to adjustments to the
Company's cost of goods sold and assumed effective tax rate. In addition, the
Company has experienced lower than expected gross margin levels in the fourth
quarter, due primarily to a delay in the implementation of price increases by
the Company, changes in product mix and an increase in the percentage of
promotional sales.
The Company also announced that Gregory M. Benson, who served as the
Company's Chief Financial Officer from 1992 through 1996, has agreed at the
request of the Board, to resume that position on an interim basis until a
replacement is named for Kevin McAleer, who resigned on October 31, 1997. Mr.
Benson will continue to serve as a member of the Board of Directors.
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"We believe that the recent margin pressure will be alleviated somewhat
as the impact of the Company's December 1997 price increase takes hold," said
Charles G. Hanson III, Chairman and Chief Executive Officer. "In an effort to
return margins to their appropriate levels, the Company has formulated a
strategy that includes price increases on additional products, which are
expected to be implemented in the first quarter of 1998."
Mr. Hanson continued, "We are extremely pleased that Mr. Benson has
agreed to resume the role of Chief Financial Officer. Mr. Benson's unique
experience in managing the Company's growth during his prior tenure will be
critical to the Company's performance during this period."
American Pad & Paper Co., which invented the legal pad in 1888, is a
leading manufacturer and marketer of paper-based office products in North
America. In its 21 U.S. facilities, the Company manufactures and distributes
writing pads, file folders, machine papers, envelopes and other office
products. Name brands include: Ampad, Century, Embassy, Gold Fibre, Huxley,
Karolton, Kent, Peel & Seel, SCM, Williamhouse and World Fibre.
This release contains forward-looking statements relating to future
financial results. Actual results may differ as a result of factors over which
the Company has no control, including the strength of domestic and foreign
economies, sales declines or slower than anticipated sales growth, price and
product competition and increases in raw material costs. Additional
information which could affect the Company's financial results is included in
the Company's prospectus on file with the Securities and Exchange Commission.
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