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
August 23, 1994 (August 8, 1994)
Date of report (Date of earliest event reported)
MORRISON RESTAURANTS INC.
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE
(State or Other Jurisdiction of Incorporation)
1-12454 63-0475239
(Commission File Number) (I.R.S. Employer
Identification No.)
4721 Morrison Drive
P.O.Box 160266
Mobile, Alabama 36625
(Address of Principal Executive Offices) (Zip Code)
(205) 344-3000
(Registrant's Telephone Number)
N/A
(Former Name or Former Address, if Changed Since Last Report)
Item 2. Acquisition or Disposition of Assets.
On August 8, 1994, the Registrant sold certain education,
business and industry (B&I) contracts and assets of its contract
food-service business to Gardner Merchant Food Services, Inc., a
wholly owned subsidiary of Gardner Merchant Ltd., for a cash
payment of $100 million. The Registrant will close the remaining
B&I accounts. The sale of the B&I accounts and the
discontinuance of the remaining accounts is expected to result in
a net pre-tax gain of approximately $35 million.
The sale of B&I is part of the Registrant's strategy to
invest in high growth businesses that have or can attain a
dominant market position in their respective categories.
Proceeds from the sale will be used to fund accelerated growth
and for previously authorized share repurchases.
Item 7(b). Financial Statements, Pro Forma Financial
Information and Exhibits.
(b) Pro Forma Financial Information:
MORRISON RESTAURANTS INC.
PRO FORMA FINANCIAL INFORMATION
The unaudited pro forma financial information set forth below is
presented in order to illustrate the estimated effects of the
sale of certain education, business and industry (B&I) accounts
to Gardner Merchant Food Services, Inc. and the closure of the
remaining B&I accounts.
The pro forma financial statements for the Registrant assume for
statement of income purposes that the education, business and
industry transactions were consummated as of the first day of the
periods reported and assume for balance sheet purposes that the
transactions were consummated on March 5, 1994, the last day of
the period reported.
The pro forma financial information is presented for
informational purposes only and is not necessarily indicative of
the Registrant's results of operations or financial position in
the future or of what the Registrant's results of operations or
financial position would have been had the transactions been
consummated on or as of the dates referred to above. The pro
forma financial information should be read in conjunction with
the consolidated financial statements of the Registrant and the
notes thereto included in the Registrant's Fiscal 1993 Form 10-K.
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ITEM 7(b) - CONTINUED
MORRISON RESTAURANTS INC.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
<CAPTION>
March 5, 1994
Pro Forma
B&I Adjustments Pro Forma
Historical (i) (ii) Results
<S> <C> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and short-term investments......... $ 18,919 ($ 2,228) $ 16,691
Receivables - Accounts and Notes (net).. 37,188 (14,505) 22,683
Inventories............................. 17,010 (4,895) 12,115
Prepaid expenses and other
current assets........................ 23,634 (3,961) 19,673
Total current assets.................... 96,751 (25,589) 71,162
PROPERTY AND EQUIPMENT - at cost........ 491,878 (28,274) 463,604
Less accumulated depreciation
and amortization...................... 233,849 (13,316) 220,533
258,029 (14,958) 243,071
OTHER INVESTMENTS....................... 8,450 (72) 8,378
COST IN EXCESS OF NET ASSETS ACQUIRED... 22,772 (6,911) 15,861
OTHER ASSETS............................ 44,912 (9,639) 35,273
TOTAL ASSETS............................ $430,914 ($57,169) $373,745
See page 8 for a description of balance sheet pro forma adjustments.
See Notes to Pro Forma Consolidated Financial Statements.
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ITEM 7(b) - CONTINUED
MORRISON RESTAURANTS INC.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
<CAPTION>
March 5, 1994
Pro Forma
B&I Adjustments Pro Forma
Historical (i) (ii) Results
<S> <C> <C> <C>
LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts and notes payable.............. $40,930 ($8,711) $32,219
Other current liabilities............... 73,263 (19,179) 54,084
Total Current Liabilities............... 114,193 (27,890) 86,303
LONG-TERM DEBT.......................... 9,008 0 9,008
OTHER DEFERRED LIABILITIES.............. 75,795 (5,655) 70,140
STOCKHOLDERS' EQUITY:
Common Stock, $.01 par value
(authorized: 50,000 shares;
issued: 03/05/94 - 43,644 shares)...... 436 0 436
Capital in excess of par value.......... 78,093 0 78,093
Retained earnings....................... 238,776 (23,624) 215,152
317,305 (23,624) 293,681
Less common stock held in
treasury - at cost
(7,562 shares @ 03/05/94)............... 85,387 0 85,387
231,918 (23,624) 208,294
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $430,914 ($57,169) $373,745
See page 8 for a description of balance sheet pro forma adjustments.
See Notes to Pro Forma Consolidated Financial Statements.
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ITEM 7(b) - CONTINUED
MORRISON RESTAURANTS INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands)
(Unaudited)
For the Thirty-Nine Weeks Ended March 5, 1994
<CAPTION>
Pro Forma
B&I Adjustments Pro Forma
Historical (i) (ii) Results
<S> <C> <C> <C>
SALES................................... $902,469 $(186,536) $715,933
COST AND EXPENSES:
Cost of Merchandise.................. 281,437 (69,286) 212,151
Payroll and related costs............ 325,881 (70,831) 255,050
Other operating costs................ 157,204 (28,305) 128,899
Selling, general and administrative.. 55,956 (10,142) 45,814
Depreciation......................... 29,208 (2,350) 26,858
Interest expense net of interest
income............................. 283 0 283
849,969 (180,914) 669,055
Income Before Provision for Income
Taxes and Cumulative Effect
of Accounting Changes............... 52,500 (5,622) 46,878
Provision for Federal and State
Income Taxes........................ 20,053 (2,231) 17,822
Net Income.............................. $ 32,447 $ (3,391) $ 29,056
Earnings Per Common and Common
Equivalent Share:
Primary.............................. $0.87 ($0.09) $0.78
Fully Diluted........................ $0.87 ($0.09) $0.78
Weighted average shares used in
earnings per common and common
equivalent shares computation:
Primary.............................. 37,481 37,481 37,481
Fully Diluted........................ 37,510 37,510 37,510
See page 8 for a description of Statement of Income Pro Forma Adjustments.
See Notes to Pro Forma Consolidated Financial Statements.
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ITEM 7(b) - CONTINUED
MORRISON RESTAURANTS INC. AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENTS OF INCOME
(In thousands)
(Unaudited)
For the Fifty-Two Weeks Ended June 5, 1993
<CAPTION>
Pro Forma
B&I Adjustments Pro Forma
Historical (i) (ii) Results
<S> <C> <C> <C>
REVENUES:
Net Sales and Operating Revenues.... $1,098,268 $(221,033) $877,235
Other Revenues...................... 1,577 (1,369) 208
1,099,845 (222,402) 877,443
OPERATING COSTS AND EXPENSES:
Cost of merchandise................. 352,043 (83,126) 268,917
Payroll and related costs........... 398,077 (85,919) 312,158
Other............................... 191,846 (31,744) 160,102
Selling, general and administrative. 61,229 (11,829) 49,400
Depreciation and amortization....... 35,449 (2,871) 32,578
Interest expense net of interest
income totaling $1,822............. 317 0 317
1,038,961 (215,489) 823,472
Income Before Provision for Income
Taxes and Cumulative Effect
of Accounting Changes............... 60,884 (6,913) 53,971
Provision for Federal and State
Income Taxes........................ 22,725 (2,686) 20,039
Income Before Cumulative Effect
of Accounting Changes............... $ 38,159 $ (4,227) $ 33,932
Earnings Per Common and Common
Equivalent Share Before Cumulative
Effect of Accounting Changes:
Primary............................. $1.01 ($0.11) $0.90
Fully Diluted....................... $1.01 ($0.11) $0.90
Weighted average shares used in
earnings per common and common
equivalent shares computation:
Primary............................. 38,078 38,078 38,078
Fully Diluted....................... 38,151 38,151 38,151
See page 8 for a description of Statement of Income Pro Forma Adjustments.
See Notes to Pro Forma Consolidated Financial Statements.
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ITEM 7(b) - CONTINUED
MORRISON RESTAURANTS INC.
Pro Forma Adjustments
The pro forma adjustments give effect to the items described
below:
(i) Adjustments reflect the removal of education, business and
industry (B&I) net assets and net income.
(ii) The following items are not included in the proforma
adjustments due to their non-recurring nature or uncertain
amounts:
* Net gain on sale and discontinuance of B&I contracts and
assets of approximately $35 million pre-tax which includes
certain expenses incurred in relation to the divestiture of
B&I.
ITEM 7(c) Exhibits
The following exhibit is filed with this Report.
2 Asset Purchase Agreement dated June 27, 1994 by and
among Morrison Restaurants Inc. and Gardner Merchant
Food Services, Inc. and the related exhibits to such
agreement. Schedules to this exhibit have been omitted
pursuant to Item 601(b)(2) of Regulation S-K. The
Registrant hereby undertakes to furnish supplementally
a copy of any omitted schedule to the Commission upon
request.<F1>
<F1>
Incorporated herein by reference to Exhibit 2 of Current Report
on Form 8-K dated July 27, 1994 of Commission File No. 1-12454.
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.
MORRISON RESTAURANTS INC.
(Registrant)
08/23/94 /s/ J. Russell Mothershed
DATE J. RUSSELL MOTHERSHED
Senior Vice President, Finance
(Senior Vice President and
Principal Accounting Officer)
