Form 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
[x] Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter Ended June 30, 1994
[ ] Transition Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Commission File Number - 0-12321
ANUHCO, INC.
State of Incorporation - Delaware
IRS Employer Identification No. - 46-0278762
9393 West 110th Street, Suite 100, Overland Park, Kansas 66210
Telephone Number - (913) 451-2800
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.___.
Indicate the number of shares outstanding of each of the issuer's
classes of common stock.
Anuhco, Inc.
Common Stock, $0.01 par value
7,543,470 shares outstanding
as of June 30, 1994
Form 10-Q
Contains 11 pages
<PAGE>
PART I - FINANCIAL INFORMATION
<TABLE>
Item 1. Financial Statements
ANUHCO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
For the Periods Ended June 30
(In Thousands, Except Per Share Data)
<CAPTION>
Second Quarter First Half
1994 1993 1994 1993
<S> <C> <C> <C> <C>
Operating Revenue.............. $25,174 $18,896 $46,357 $36,900
Operating Expense.............. 23,330 18,269 43,778 35,951
Operating Income............... 1,844 627 2,579 949
Nonoperating Income (Expense)
Interest income.............. 63 34 112 63
Interest expense............. ( 39) ( 50) ( 79) (117)
Gain on sale of property and
equipment, net............. 7 -- 14 1
Other, net................... -- 50 1 100
Total nonoperating income
(expense)... 3 34 48 47
Income from Continuing Operations
before Income Taxes.......... 1,875 661 2,627 996
Income Tax Provision (Note 2).. -- -- -- --
Income from Continuing Operations. 1,875 661 2,627 996
Income from Discontinued Operations
(Note 6)....................... 1,250 2,500 1,250 2,500
Net Income....................... $3,125 $ 3,161 $ 3,877 $ 3,496
Average Common Shares Outstanding
(Note 5)........................ 7,543 7,542 7,543 7,542
Net Income Per Share from Continuing
Operations.................... $0.25 $0.09 $0.35 $0.13
Net Income Per Share from Discontinued
Operations.................... $0.16 $0.33 $0.16 $0.33
Net Income Per Share............. $0.41 $0.42 $0.51 $0.46
</TABLE>
[FN]
The accompanying notes to consolidated financial statements
are an integral part of these statements.
<PAGE>
<TABLE>
ANUHCO, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<CAPTION>
June 30 Dec. 31
1994 1993
ASSETS (In Thousands)
<S> <C> <C>
Current Assets
Cash and temporary cash investments........... $ 4,207 $ 4,708
Accounts receivable, less allowance for doubt-
ful accounts of $432 and $358 respectively. 8,839 6,731
Insurance refund receivable................... 564 574
Inventories................................... 395 380
Prepayments................................... 485 249
Total current assets....................... 14,490 12,642
Operating Property, at Cost
Revenue equipment............................. 15,155 14,775
Land.......................................... 2,753 1,500
Structures and improvements................... 6,411 3,913
Other operating property...................... 3,952 3,705
28,271 23,893
Less accumulated depreciation.............. (14,175) (13,353)
Net property & equipment................. 14,096 10,540
Long-Term Obligation Receivable................. 1,225 1,180
Other Assets.................................... 45 122
Discontinued Operations (Note 6)................ -- --
$29,856 $24,484
</TABLE>
<TABLE>
LIABILITIES AND SHAREHOLDERS' EQUITY
<S> <C> <C>
Current Liabilities
Current maturities of long-term debt.......... $ -- $ --
Accounts payable.............................. 1,183 1,187
Accrued payroll and fringes................... 5,987 3,934
Claims and insurance accruals................. 186 142
Income tax payable............................ ( 99) --
Other accrued expenses........................ 361 303
Total current liabilities.................. 7,618 5,566
Long-Term Debt, Net of Current Maturities....... 1,300 1,860
Shareholders' Equity
Preferred stock with $0.01 par value, author-
ized 1,000,000 shares, none outstanding..... -- --
Common stock with $0.01 par value, authorized
13,000,000 shares, outstanding 7,543,470
shares (Note 5)............................. 75 75
Paid-in capital (Note 5)...................... 5,322 5,319
Retained earnings............................. 15,541 11,664
Total shareholders' equity................. 20,938 17,058
$29,856 $24,484
</TABLE>
[FN]
The accompanying notes to consolidated financial statements
are an integral part of this statement.
<PAGE>
<TABLE>
ANUHCO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the First Half Ended June 30
<CAPTION>
1994 1993
(In Thousands)
<S> <C> <C>
Cash Flows From Operating Activities -
Net income................................... $ 3,877 $ 3,496
Adjustments to reconcile net income to net
cash generated in operating activities -
Gain on sale of assets..................... ( 14) ( 1)
Depreciation and amortization.............. 1,112 977
Net increase (decrease) from change in
other working capital items affecting
operating activities.................... ( 289) ( 206)
Effect of discontinued operations (Note 6). (1,250) (2,500)
Total adjustments..................... ( 441) (1,730)
Net Cash Generated (Used)...................... 3,436 1,766
Cash Flows from Investing Activities -
Proceeds from discontinued operations
(Note 6)................................... 1,250 2,500
Purchase of operating property............... (4,627) (1,392)
Cash Flows from Financing Activities -
Repayment of Debt............................ ( 560) (1,597)
Net Increase (Decrease) In Cash and
temporary cash investments................... ( 501) 1,277
Cash and Temporary Cash Investments at
beginning of period.......................... 4,708 1,230
Cash and Temporary Cash Investments
at end of period............................. $ 4,207 $ 2,507
Cash Paid During the Period for:
Interest..................................... $ 79 $ 71
Income Tax................................... 43 27
</TABLE>
[FN]
The accompanying notes to consolidated financial statements
are an integral part of these statements.
<PAGE>
<TABLE>
ANUHCO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
For the Periods Ended June 30
<CAPTION>
Second Quarter First Half
1994 1993 1994 1993
(In Thousands)
<S> <C> <C> <C> <C>
Common Stock -
Balance at beginning of period.. $ 75 $ 5,394 $ 75 $ 5,394
Effect of the change in par value
(Note 5)...................... -- (5,319) -- (5,319)
Balance at end of period........ $ 75 $ 75 75 $ 75
Paid-in Capital -
Balance at beginning of period... $5,321 $ -- $5,319 $ --
Issuance of common shares under the
Incentive Stock Plan.......... 1 -- 3 --
Effect of the change in par value
(Note 5)...................... -- 5,319 -- 5,319
Balance at end of period......... $5,322 $5,319 $ 5,322 $5,319
Retained Earnings -
Balance at beginning of period.... $12,416 $5,563 $11,664 $5,228
Income from continuing operations. 1,875 661 2,627 996
Income from discontinued operations
(Note 6)....................... 1,250 2,500 1,250 2,500
Balance at end of period.......... $15,541 $8,724 $15,541 $8,724
</TABLE>
[FN]
The accompanying notes to consolidated financial statements
are an integral part of these statements.
<PAGE>
ANUHCO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Principles of Consolidation
The consolidated financial statements include Anuhco and all of
its subsidiary companies ("the Company"). All significant
intercompany accounts and transactions have been eliminated in
consolidation. The condensed financial statements included herein
have been prepared pursuant to the rules and regulations of the
Securities and Exchange Commission ("SEC") and have not been
examined or reviewed by independent public accountants. In the
opinion of management, all adjustments necessary to present fairly
the results of operations have been made.
Pursuant to SEC rules and regulations, certain information and
footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting
principles have been condensed or omitted from these statements
unless significant changes have taken place since the end of the
most recent fiscal year. Anuhco believes that the disclosures
contained herein, when read in conjunction with the financial
statements and notes included, or incorporated by reference, in
Anuhco's Form 10-K, filed with the SEC on March 2, 1994, are
adequate to make the information presented not misleading. It is
suggested, therefore, that these statements be read in conjunction
with the statements and notes included, or incorporated by
reference, in the aforementioned report on Form 10-K.
2. Income Taxes
During the first quarter of 1993, the Company adopted Statement
of Financial Accounting Standard No. 109, Accounting for Income
Taxes ("SFAS 109"). SFAS 109 requires the recognition of deferred
tax assets, net of applicable reserve, related to net operating
loss ("NOL") carryforwards and certain temporary differences.
Although the Company has NOL carryforwards and temporary
differences in excess of $32 million, no asset recognition is
provided in these consolidated financial statements, as the
realization of such an asset within the next several years is not
reasonably assured based on the information currently available to
the Company. Such an asset may be recognized in future periods
based upon the facts and circumstances at that time.
<PAGE>
3. Profit Sharing
In September 1988, the employees of Crouse Cartage Company
("Crouse Cartage") approved the establishment of a profit sharing
plan ("the Plan"). The Plan is structured to allow all employees
(union and non-union) to ratably share 50 percent of income before
income taxes (excluding extraordinary items and gains or losses on
the sale of assets) in return for a 15 percent reduction in their
wages. Plan distributions are made on a quarterly basis. The Plan
was recertified in 1991 and 1994, and shall continue in effect at
least through March 31, 1998, or until a replacement of the
Collective Bargaining Agreement is reached between Crouse Cartage
and its union employees, whichever is the later. The accompanying
consolidated balance sheet for the period ended June 30, 1994
includes an accrual for profit sharing costs of $1,984,082. The
accompanying consolidated statements of income includes profit
sharing costs of $1,984,082 and $2,872,003 for the second quarter
and first half, respectively.
4. Revolving Credit Agreement
In September 1988, Crouse Cartage entered into a five-year credit
agreement with a commercial bank which provided for maximum
borrowings equaling the lesser of $2,500,000 or the sum of 80
percent of the net depreciated value of Crouse Cartage's revenue
equipment. In June, 1994 the term of this agreement was extended
to June 30, 1996. There was no outstanding balance on this
revolving line of credit at June 30, 1994.
5. Shareholders' Equity
In accordance with a resolution to amend the Company's
Certificate of Incorporation, duly prepared and adopted at the
Company's 1993 Annual Shareholders' Meeting, the capital stock of
the Company was changed from stock without par value to $0.01 par
value per share. Such change has no impact on total shareholders'
equity but did require a reclassification of a portion of capital
stock to paid-in capital. This amendment provided a cost savings
on certain franchise taxes.
Income per share is based on the average number of common shares
outstanding during each period. The average number of common
shares so computed was 7,543,470 and 7,543,006 for the quarter and
year to date for the periods ending June 30, 1994 and 7,542,270 for
the quarter and year to date periods ending June 30, 1993.
<PAGE>
6. Discontinued Operations
Under the provisions of a Joint Plan of Reorganization ("the
Joint Plan"), American Freight System, Inc. ("AFS") is responsible
for the continued resolution of pre-July 11, 1991 creditor claims
and conversion of assets owned before that date. As claims are
allowed and sufficient cash is available, distributions to the
creditors and Anuhco will occur.
On April 29, 1994, AFS made an interim distribution under the
Joint Plan of 5% of each allowed unsecured claim. Anuhco's
participation in this distribution was $1.25 million.
To date AFS has achieved more favorable results than were assumed
in the March 21, 1991 disclosure statement relating to the Joint
Plan. Such results are due to favorable (i) settlements of certain
claims, (ii) court decisions and (iii) asset realizations. A
revised projection is that total distributions to Anuhco (including
the $7.25 million previously distributed during 1992, 1993 and
1994) will exceed $10 million, excluding any proceeds which may
result from a judgment against Westinghouse Electric Corporation
("WEC"). This revised projection continues to include the
assumptions enumerated in the disclosure statement regarding
conditions and contingencies. Due to the number and value of
claims to be resolved and assets to be converted to cash, the
timing and amount of additional interim distributions and the
timing of the final distribution have not been included in the
revised projection.
On February 23, 1993, a judgment in favor of Anuhco and AFS was
entered in the Circuit Court of Jackson County, Missouri, at Kansas
City, Missouri ("the Court"). This judgment was entered in a case
filed by Anuhco and AFS against WEC seeking damages as a result of
WEC's failure to provide financing pursuant to a loan commitment
issued on June 3, 1988. The judgment awarded $70 million in actual
damages to be paid to Anuhco and AFS. WEC filed motions with the
Court to have this judgment set aside or to have a new trial
granted. On April 8, 1993 WEC's motions were overruled. WEC filed
a notice of appeal of this judgment to the Missouri Court of
Appeals, Western District. On July 12, 1994, the Missouri Court of
Appeals issued a unanimous opinion affirming the Court's judgment
in favor of Anuhco and AFS. WEC filed a motion for rehearing
before the Missouri Court of Appeals and in the alternative, a
motion for transfer to the Missouri Supreme Court on July 27, 1994.
A surety bond in support of such judgment, accrued interest (9%
simple interest) and other costs has been posted by WEC in the
amount of $79.5 million.
<PAGE>
Proceeds of the judgment, assuming no modification in such
rehearing or transfer, net of trial expenses, will be remitted to
AFS. AFS will distribute such proceeds under the Joint Plan
adopted in 1991. Payments received by Anuhco as a result of
distributions under the Joint Plan are recorded by it as income
from discontinued operations. Based on our current estimates, if
the $70 million judgment plus accrued interest is substantially or
fully collected, and both the remaining AFS assets are converted to
cash and the remaining claims against AFS are resolved in
accordance with expectations, Anuhco would ultimately receive net
proceeds of $38 million to $45 million. This represents $5 to $6
per share on Anuhco's outstanding shares. Assuming the motions
before the Missouri Court of Appeals are denied and the Missouri
Supreme Court refuses transfer of the case, the proceeds of the
judgment could be received before the end of 1994. Anuhco and AFS
are unable to predict when or how this matter will ultimately be
resolved.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
<TABLE>
RESULTS OF OPERATIONS
First Half 1994 Compared to First Half 1993
A comparative summary of consolidated operating expenses as a
percent of consolidated operating revenue for the six months ended
June 30, 1994 and 1993 is:
<CAPTION>
Percent of Operating Revenue
First Half Increase
1994 1993 (Decrease)
<S> <C> <C> <C>
Salaries, wages and employee benefits. 53.9% 54.6% (0.7)%
Operating supplies and expenses....... 11.1 12.3 (1.2)
Operating taxes and licenses.......... 2.8 2.8 -
Insurance and claims.................. 2.3 2.3 -
Depreciation.......................... 2.4 2.7 (0.3)
Purchased transportation.............. 21.9 22.7 (0.8)
Total operating expenses............ 94.4% 97.4% (3.0)%
</TABLE>
Anuhco's first half 1994 consolidated operating revenue and
performance were favorably effected by continued regional economic
recovery, a teamsters union strike against several competitors, and
the closing of a regional carrier within the Company's operating
area, as compared to the first half of 1993. Total tonnage of year
to date shipments increased 13.7% to 425,703 tons; on an increase
of 24.9% in tonnage of shipments of less than 10,000 pounds and a
increase of 10.4% in tonnage of shipments 10,000 pounds and over.
For shipments of less than 10,000 pounds average revenue per
shipment increased 6.3% to $102.50 and average weight of shipment
increased 3.9% to 1,072 pounds. For shipments of 10,000 pounds
and over, average revenue per shipment increased 1.6% to $642.91
and average weight of shipment decreased 3.9% to 29,663 pounds.
<TABLE>
Second Quarter 1994 Compared to Second Quarter 1993
A comparative summary of consolidated operating expenses as a
percent of consolidated operating revenue for the second quarter
ended June 30, 1994 and 1993 is:
<CAPTION>
Percent of Operating Revenue
Second Quarter Increase
1994 1993 (Decrease)
<S> <C> <C> <C>
Salaries, wages and employee
benefits.................. 53.7% 54.6% (0.9)%
Operating supplies and
expenses.................. 10.4 12.1 (1.7)
Operating taxes and licenses.. 2.6 2.6 -
Insurance and claims.......... 2.2 2.3 (0.1)
Depreciation.................. 2.4 2.4 -
Purchased transportation...... 21.4 22.7 (1.3)
Total operating expenses.... 92.7% 96.7% (4.0)%
</TABLE>
Anuhco's second quarter 1994 consolidated operating revenue and
performance were favorably effected by continued regional economic
recovery, a teamsters union strike against several competitors, and
the closing of a regional carrier within the Company's operating
area, offset somewhat by wage increases, as compared to the second
quarter 1993. Total tonnage of second quarter shipments increased
21.5% to 225,552 tons; on an increase of 32.6% in tonnage of
shipments of less than 10,000 pounds and an increase of 13.3% in
tonnage of shipments 10,000 pounds and over. For shipments of less
than 10,000 pounds average revenue per shipment increased 8.7% to
$103.87 and average weight of shipment increased 5.8% to 1,080
pounds. For shipments of 10,000 pounds and over, average revenue
per shipment increased 2.2% to $645.01 and average weight of
shipment decreased 2.9% to 29,717 pounds.
FINANCIAL CONDITION
The Company's financial condition was strengthened during the
first half of 1994. Shareholders' equity increased by $3.9 million
as a result of $2.6 million net income from continuing operations
and a $1.25 million distribution from discontinued operations.
Loan payments from working capital reduced the Company's long-term
debt net of current maturities, by $560,000 from December 31, 1993.
In addition, Crouse Cartage closed on various purchases of
operating property for $4.6 million, paid from working capital.
<PAGE>
Item 4. Submission of Matters to a Vote of Security Holders
(a) Annual Meeting of Shareholders was held on May 24, 1994.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
20(a) - Report to Shareholders for the Second
Quarter, 1994, dated August 15, 1994, included
herewith.
(b) Reports on Form 8-K
None
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.
Anuhco, Inc.
Registrant
By: /s/ John P. Bigger
John P. Bigger, President,
Chief Executive Officer, and
Chief Financial Officer
Date: August 15, 1994
<PAGE>
Exhibit 20(a)
Page 1 of 2
ANUHCO, INC.
REPORT TO SHAREHOLDERS
SECOND QUARTER 1994
Second quarter 1994 consolidated net income from continuing
operations was $1,875,000 or $0.25 per share on revenue of $25.2
million, as compared with second quarter 1993 consolidated net
income from continuing operations of $661,000 or 0.09 per share on
revenue of $18.9 million. This increase reflects a continued
improvement in the economy, the impact of the teamsters union
strike against some competitors, and the closing of a regional
carrier within Crouse's operating territory. Additional income of
$1.25 million and $2.5 million from discontinued operations
increased consolidated net income to $3.1 million and $3.2 million
for the second quarter of 1994 and 1993, respectively.
Crouse Cartage Company, Anuhco's general commodity motor carrier,
had operating income of $1,947,000 on revenues of $25.2 million for
the second quarter 1994; as compared to operating income of
$782,000 on revenues of $18.9 million for the second quarter 1993.
Crouse Cartage's negotiations with the International Brotherhood of
Teamsters were completed with the signing of a 4 year contract and
the ratification by the teamsters and other employees of the
Company's profit sharing plan covering the same period.
Other news, at the 1994 Annual Meeting of the Shareholders, all
members of the Board of Directors were re-elected and the selection
of Arthur Andersen & Co. as independent public accountants for 1994
was ratified with 80% of the outstanding Anuhco shares voting.
Also, on July 12, 1994 the Missouri Court of Appeals issued a
unanimous opinion affirming the $70 million judgment in favor of
Anuhco and American Freight System ("AFS") against Westinghouse
Electric Corporation ("WEC"). WEC filed a motion on July 27, 1994
for rehearing before the Missouri Court of Appeals and in the
alternative, a motion for transfer to the Missouri Supreme Court.
The surety bond posted in support of this judgment and other costs
was increased by WEC to $79.5 million. If the $70 million judgment
plus accrued interest is substantially or fully collected, and both
the remaining AFS assets are converted to cash and the remaining
claims against AFS are resolved in accordance with expectations,
Anuhco would ultimately receive net proceeds of $38 million to $45
million. This represents $5 to $6 per share on Anuhco's
outstanding shares. Assuming the motions before the Missouri Court
of Appeals are denied and the Missouri Supreme Court refuses
transfer of the case, the proceeds of the judgment could be
received before the end of 1994. Anuhco and AFS are unable to
predict when or how this matter will ultimately be resolved.
/s/ John P. Bigger /s/ Roy R. Laborde,
John P. Bigger, Roy R. Laborde,
President & CEO Chairman
August 15, 1994
<PAGE>
Exhibit 20(a)
Page 2 of 2
<TABLE>
<CAPTION>
UNAUDITED SUMMARY FINANCIAL STATEMENTS
(in thousands, except per share data)
CONSOLIDATED STATEMENTS OF INCOME
Periods Ended June 30
Second Quarter Year to Date
1994 1993 1994 1993
<S> <C> <C> <C> <C>
Operating Revenue........ $25,174 $18,896 $46,357 $36,900
Operating Income ........ 1,844 627 2,579 949
Net Income -
Continuing Operations. 1,875 661 2,627 996
Discontinued Operations 1,250 2,500 1,250 2,500
Total.............. 3,125 3,161 3,877 3,496
Income Per Share -
Continuing Operations..$ 0.25 $ 0.09 $ 0.35 $ 0.13
Discontinued Operations 0.16 0.33 0.16 0.33
Total..............$ 0.41 $ 0.42 $ 0.51 $ 0.46
Average Common Shares
Outstanding............ 7,543 7,542 7,543 7,542
</TABLE>
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEETS
06/30/94 12/31/93
ASSETS
<S> <C> <C>
Current Assets..................... $14,490 $12,642
Operating Property (net)........... 14,096 10,540
Other Assets....................... 1,270 1,302
$29,856 $24,484
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND SHAREHOLDERS' EQUITY
<S> <C> <C>
Current Liabilities................ $ 7,618 $ 5,566
Long-Term Debt..................... 1,300 1,860
Shareholders' Equity............... 20,938 17,058
$29,856 $24,484
</TABLE>
