SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
September 10, 1996
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(Date of earliest event reported)
STOKELY USA, INC.
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(Exact name of registrant as specified in its charter)
Commission File No. 0-13943
Wisconsin 39-0513230
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(State or other jurisdiction (I.R.S. Employer
of incorporation) Identification No.)
1055 Corporate Center Drive
Oconomowoc, Wisconsin 53066
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(Address of principal executive offices) (Zip Code)
(414) 569-1800
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(Registrant's telephone number, including area code)
ITEM 5. OTHER EVENTS
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Stokely USA, Inc. issued a press release on September 10,
1996, announcing a major restructuring of its core canned
vegetable business. The action is designed to substantially
improve operating margins in the Company's core business in order
to achieve consistently profitable operating results. The margin
improvement initiatives will be implemented through a combination
of customer value analysis, production consolidation and related
reductions in general and administrative areas. Four of the
Company's nine processing facilities will be affected by the
consolidation moves with two being closed and two expanded. The
consolidation moves will increase efficiency while new state-of-the-art
equipment in the expanded facilities will further enhance product quality.
The Company believes the combined effect of the initiatives,
when fully implemented, will improve the operating results of its
canned vegetable business by over $14 million compared to fiscal
1996. The actions will reduce total employment at the Company by
approximately 15% by the end of the current fiscal year. There
will be a severance package for all affected full-time employees.
The Company will record a nonrecurring charge of $13.1 million in
the second quarter ending September 30 related to the
restructure. The charge is substantially non-cash.
Commenting on the announcement, Stokely President and CEO
Stephen W. Theobald said, "Clearly Stokely has struggled with the
extremely difficult conditions prevailing in our industry during
the past several years. Prior efforts to improve the Company's
performance by eliminating non-core products and distribution
channels were significant and necessary actions. However, in an
intensely competitive industry, our actions must go further, they
must also attack the way we operate our core business. Our goal
here is to build a stronger Company that can better serve its key
customer base and build value for its owners. We are embarking
on this undertaking despite improving industry dynamics and
market conditions because it will make us a stronger player under
any circumstances.
"This core business restructure focuses on the needs of our
best customers, and then determines how we can meet those needs
most efficiently. We've used a comprehensive approach to
improving performance that has affected every line of the income
statement. This is a departure from the cost driven approach
used in the past, and a difference that I believe substantially
improves the outcome. We're changing our approach to market
segments and distribution channels to improve the quality of our
revenue stream. We've identified major changes in our
manufacturing configuration that reduce cost and, at the same
time, further improve product quality. And, we've simplified
general corporate support. These initiatives affect virtually
every part of our business. When we have completed their
implementation, we believe we will have a solid foundation on
which to build for the future."
The discussion in this Form 8-K includes certain forward-
looking statements based on current management expectations.
Factors which could cause future results to differ from these
expectations include the following: general economic conditions;
vegetable processing industry conditions and price and volume
fluctuations; competitive pressures and pricing pressures;
inventory risks; supply-related risks; demand-related risks;
third party lender actions; and results of Company-specific cost
containment and profit enhancement initiatives. Additional
factors are described in the Company's other reports filed with
the Securities and Exchange Commission.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION
AND EXHIBITS.
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Not Applicable
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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.
STOKELY USA, INC.
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Registrant
Date: September 23, 1996 /s/ Stephen W. Theobald
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Stephen W. Theobald
President and Chief Executive
Officer
Date: September 23, 1996 /s/ Leslie J. Wilson
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Leslie J. Wilson
Vice President - Finance
(Principal Financial Officer)
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.
STOKELY USA, INC.
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Registrant
Date: September 23, 1996
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Stephen W. Theobald
President and Chief Executive
Officer
Date: September 23, 1996
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Leslie J. Wilson
Vice President - Finance
(Principal Financial Officer)
