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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13
[X] OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended MARCH 31, 1994
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OR
TRANSITION REPORT PURSUANT TO SECTION 13
[ ] OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission file number 1-9278
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CARLISLE COMPANIES INCORPORATED
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(Exact name of registrant as specified in its charter)
DELAWARE 31-1168055
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(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
250 SOUTH CLINTON STREET, SUITE 201, SYRACUSE, NEW YORK 13202
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(Address of principal executive offices) (Zip code)
315-474-2500
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(Registrant's telephone number, including area code)
Indicate by check mark whether 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
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Shares of common stock outstanding at May 1, 1994 15,269,029
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PART I. FINANCIAL INFORMATION
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CARLISLE COMPANIES INCORPORATED AND SUBSIDIARIES
Condensed Statements of Consolidated Earnings
Three Months ended March 31, 1994 and 1993
(Dollars in thousands except per share amounts)
<TABLE>
<CAPTION>
1994 1993
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<S> <C> <C>
Net Sales $ 154,700 $ 138,420
Cost and expenses:
Cost of goods sold 115,233 103,246
Selling and administrative expenses 24,943 22,290
Research and development expenses 2,940 2,565
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143,116 128,101
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Operating profit 11,584 10,319
Other income (deductions):
Investment income 738 953
Interest expense (1,043) (1,300)
Other, net (108) (218)
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(413) (565)
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Earnings before income taxes 11,171 9,754
Income taxes 4,413 3,853
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Net earnings $ 6,758 $ 5,901
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Average common shares outstanding 15,505 15,411
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Net earnings per share $ .44 $ .38
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Dividends declared and paid per share $ .18 $ .17
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</TABLE>
See accompanying notes to interim financial statements.
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CARLISLE COMPANIES INCORPORATED AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
March 31, 1994 and December 31, 1993
(Dollars in thousands except share amounts)
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1994 1993
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<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 36,854 $ 51,802
Receivables, less allowances of
$4,002 in 1994 and $3,906 in 1993 108,205 91,158
Inventories 73,518 64,976
Deferred Income Taxes 16,616 16,456
Prepaid expenses and other 11,369 12,287
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TOTAL CURRENT ASSETS 246,562 236,679
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PROPERTY, PLANT AND EQUIPMENT 323,623 318,794
Less accumulated depreciation 179,837 176,565
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NET PROPERTY,PLANT AND EQUIPMENT 143,786 142,229
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OTHER ASSETS
Patents and other intangibles 15,327 15,831
Investments and advances to affiliates 14,018 17,780
Receivables and other assets 7,721 7,889
Deferred income taxes 3,550 2,955
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TOTAL OTHER ASSETS 40,616 41,455
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$430,964 $420,363
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 35,898 $ 28,681
Accrued expenses 62,034 63,524
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TOTAL CURRENT LIABILITIES 97,932 92,205
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LONG-TERM LIABILITIES
Long-term debt 59,498 59,548
Product warranties 47,344 46,803
Deferred compensation and other liabilities 1,339 1,284
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TOTAL LONG-TERM LIABILITIES 108,181 107,635
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STOCKHOLDERS' EQUITY:
Common stock, $1 par value. Authorized
25,000,000 shares; issued 19,665,312 shares 19,665 19,665
Additional paid-in capital 440 132
Retained earnings 262,966 258,956
Cost of shares in treasury (1994 - 4,399,981
shares; 1993 - 4,412,188 shares) (58,220) (58,230)
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TOTAL STOCKHOLDERS' EQUITY 224,851 220,523
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$430,964 $420,363
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</TABLE>
See accompanying notes to interim financial statements.
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CARLISLE COMPANIES INCORPORATED AND SUBSIDIARIES
Condensed Statements of Consolidated Cash Flows
Three Months ended March 31, 1994 and 1993
(Dollars in thousands)
<TABLE>
<CAPTION>
1994 1993
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<S> <C> <C>
OPERATING ACTIVITIES
Net earnings $ 6,758 $ 5,901
Reconciliation of net earnings to cash flows:
Depreciation 4,456 4,530
Amortization 644 321
Changes in assets and liabilities excluding
effects of acquisitions:
Current and long-term receivables (16,246) (23,863)
Inventories (8,542) (3,564)
Accounts payable and accrued expenses 2,311 12,411
Prepaid, deferred and current income taxes 2,613 1,997
Long-term liabilities 596 (250)
Other 636 935
Net assets of discontinued operations -- (363)
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(6,774) (1,945)
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INVESTING ACTIVITIES
Capital expenditures (6,137) (9,422)
Acquisitions, net of cash -- (12,333)
Other 761 (265)
Net activities of discontinued operations -- 527
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(5,376) (21,493)
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FINANCING ACTIVITIES
Reductions of long-term debt (50) (12,050)
Dividends (2,748) (2,600)
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(2,798) (14,650)
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CHANGE IN CASH AND CASH EQUIVALENTS (14,948) (38,088)
CASH AND CASH EQUIVALENTS
Beginning of period 51,802 90,605
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End of period $36,854 $52,517
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</TABLE>
See accompanying notes to interim financial statements.
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
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Three Months Ended March 31, 1994 and 1993
(1) The accompanying unaudited condensed consolidated financial statements
include the accounts of Carlisle Companies Incorporated and its wholly-
owned subsidiaries (together, the "Company"). Intercompany transactions
and balances have been eliminated in consolidation. The unaudited condensed
consolidated financial statements have been prepared in accordance with
Article 10-01 of Regulation S-X of the Securities and Exchange Commission
and, as such, do not include all information required by generally accepted
accounting principles. However, in the opinion of the Company, these
financial statements contain all adjustments, consisting of only normal
recurring adjustments, necessary to present fairly the financial position
as of March 31, 1994 and December 31, 1993, the results of its operations
for the three months ended March 31, 1994 and 1993, and its cash flows for
the three months ended March 31, 1994 and 1993.
While the Company believes that the disclosures presented are adequate to
make the information not misleading, it is suggested that these financial
statements be read in conjunction with the financial statements and notes
included in the Company's 1993 Annual Report to Stockholders.
(2) The components of inventories are as follows:
<TABLE>
<CAPTION>
3/31/94 12/31/93
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(000)'s
<S> <C> <C>
First-in, first-out (FIFO) costs:
Finished goods $49,601 $43,714
Work in process 9,537 8,761
Raw materials 29,261 27,212
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88,399 79,687
Excess of FIFO cost over Last-in,
First-out (LIFO) inventory value (14,881) (14,711)
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LIFO inventory value $73,518 $64,976
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</TABLE>
(3) Net earnings per share of common stock are based on the weighted average
number of shares outstanding of 15,504,903 for the three months ended
March 31, 1994, assuming the exercise of dilutive stock options.
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
Carlisle Companies Incorporated achieved a record first quarter in sales with
revenues of $154.7 million in the first three months of 1994 compared to $138.4
million in 1993, a 12% increase. First quarter net earnings improved to $6.8
million, or $0.44 a share, a 15% increase over 1993's earnings of $5.9 million,
or $0.38 a share. Poor weather conditions in the first two months of 1994
resulted in a slow start in most of the company's major operations but sales
improved as weather returned to normal. First quarter results were driven by
sales increases and a continuation of controlled expenses across the company.
Construction Materials Segment sales were $48.3 million in the first quarter of
1994, a 10% improvement over the prior year. Although restricted by severe
weather, domestic roofing products sales increased in the first quarter of 1994.
Higher sales from Carlisle Engineered Metals and Versico, both purchased in the
first quarter of 1993, contributed to the segment sales increase in 1994.
Earnings for this segment improved 17% in the first quarter of 1994 compared to
1993. A more favorable mix of products sold combined with the increased
absorption of overhead expense from higher production levels to improve margins
in 1994 versus 1993. These gross margin improvements drove the strong financial
performance for this segment in the first three months of 1994 despite slightly
higher expense levels due to 1993 acquisitions.
Sales from the Transportation Products segment increased 13% in the first
quarter of 1994 to $51.9 million compared to $45.8 million in 1993. Segment
earnings improved to $4.0 million, a 16% increase over the first quarter of
1993. Higher sales of custom rubber and plastic products to automobile
equipment manufacturers were achieved in the first quarter of 1994, maintaining
the momentum gained in the latter part of 1993. Margin comparisons, however,
continue to reflect the pricing pressures which have been placed on suppliers to
the automotive industry. Heavy duty friction operations achieved record sales
in the first quarter of 1994 despite the effects of severe weather. Continuing
strong demand for new trucks and trailers as well as market share gains at the
original equipment manufacturers level were the primary reasons for heavy duty
friction sales gains. Industrial friction operations had a strong first quarter
as sales improved with new product introductions while braking systems sales
levels declined. An unfavorable product mix and competitive pricing pressures
within friction and braking markets brought lower gross margins, but continued
lowering of expenses resulted in the strong earnings performance.
General Industry segment sales totaled $54.5 million in the first quarter of
1994 compared to $48.7 million in 1993, a 12% increase. Segment earnings
improved 11% to $6.3 million in the first three months of 1994 compared to $5.7
million in 1993. First quarter sales of specialty tires and wheels were the
highest quarterly sales ever recorded, exceeding last year's sales by 12%.
Coming off of a record performance in 1993, demand in both the original
equipment and replacement markets remained strong. Competitive pricing
pressures were overcome through increased production, which improved overhead
absorption, and expense control to result in an increase in earnings of 15% over
1993. Foodservice plastics operations finished the quarter strongly as demand
increased in March after a slow first two months of 1994. International sales
have increased after establishing expanded distribution capabilities in Europe.
Earnings from foodservice plastics operations improved on better margin and
expense ratios despite absorbing costs associated with the relocation of product
lines and production machinery to improve efficiency. The segment also absorbed
higher levels of research and development expenditures to accelerate efforts to
commercialize the company's proprietary technology for the multilayer ceramic
capacitors market (Vistatech).
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Order backlog levels of $84.7 million at the end of the first quarter 1994
compare with a balance of $85.0 million from a year ago. Higher backlog levels
in specialty tires and wheels as well as custom molded automotive plastics were
offset by a significantly reduced backlog for aircraft wire from a level that
was excessive in 1993.
Working capital was $148.6 million at March 31, 1994. This compares to working
capital levels of $144.5 million at December 31, 1993 and $148.1 million at
March 31, 1993. The $4.1 million increase in the quarter is the positive result
of general operating performance.
There are no trends, demands, commitments, events or uncertainties that will
result in or that are reasonably likely to result in the company's liquidity
increasing or decreasing in any material way nor are there any known material
trends, favorable or unfavorable in the company's capital resources.
Long-term debt remained at $59.5 million at March 31, 1994 equal with the
balance at year-end 1993. Cash balances declined in the quarter to $36.9 million
at March 31, 1994 compared to $51.8 million at December 31, 1993. Strong March
sales drove quarter-end receivable balances higher and inventory levels were
increased to meet anticipated demand.
Carlisle's earnings performance in the first quarter was impeded by an
especially difficult winter. Indications are that second quarter earnings will
benefit from an accelerating trend after a slow start early in the first
quarter. Strong demand for our roofing products and continuing strong momentum
in our general industry segment coupled with emerging improvement in our
transportation products segment should result in another strong year for
Carlisle.
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PART II. OTHER INFORMATION
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Item 6. Exhibits and Reports on Form 8-K
(a) No exhibits are included for the quarter which this report on
Form 10-Q is filed.
(b) Report on Form 8-K, dated March 4, 1994, and filed with the
Commission on March 9, 1994 and Report on Form 8-K/A, dated March
4, 1994, and filed with the Commission on March 30, 1994, are
incorporated herein by reference.
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SIGNATURE
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Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Carlisle Companies Incorporated
Date MAY 10, 1994 By /s/Dennis J. Hall
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Dennis J. Hall
Executive Vice President,
Treasurer, and Chief
Financial Officer
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