SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended August 31, 1995
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-4903
PREMIER INDUSTRIAL CORPORATION
(Exact name of registrant as specified in its charter)
Ohio 34-0661122
(State or other jurisdiction of (I.R.S. employer identification no.)
incorporation or organization)
4500 Euclid Avenue, Cleveland, Ohio P.O. Box 94884 44101-4884
(Address of principal executive offices) (Zip code)
(216) 391-8300
(Registrant's telephone number, including area code)
None
(Former name, former address and former fiscal year, if changed since last
report)
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
Number of shares of Common Stock outstanding at October 9, 1995: 83,041,915
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PREMIER INDUSTRIAL CORPORATION
Table of Contents
Part I. Financial Information
Item 1 - Financial Statements:
Consolidated Statement of Earnings for the three months
ended August 31, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . 3
Consolidated Balance Sheet at August 31, 1995 and
May 31, 1995 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Consolidated Statement of Cash Flows for the three months
ended August 31, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . 5
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . 6
Item 2 - Management's Discussion and Analysis of Financial Condition
and Results of Operations:
Results of Operations. . . . . . . . . . . . . . . . . . . . . . . . . 7
Liquidity, Capital Resources and Cash Flows (Financial Condition). . . 7
Part II. Other Information
Item 6 - Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . . . 8
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements
PREMIER INDUSTRIAL CORPORATION AND SUBSIDIARIES
Consolidated Statement of Earnings
(Unaudited)
(In thousands of dollars, except per share data)
Three Months Ended
August 31,
1995 1994
Operating revenues $ 213,854 $ 198,372
Other income, net 2,038 779
215,892 199,151
Cost and expenses:
Cost of sales 119,049 108,059
Selling, administrative and general 49,577 47,973
Depreciation 2,223 1,946
Amortization of other assets 98 98
Interest 95 74
171,042 158,150
Earnings before income taxes 44,850 41,001
Income taxes 16,683 15,609
Net earnings $ 28,167 $ 25,392
Net earnings per share $ .34 $ .30
Dividends per share $ .11 $ .10
Average number of common shares and
common stock equivalents outstanding 83,694,998 84,943,853
See accompanying Notes to Consolidated Financial Statements.
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PREMIER INDUSTRIAL CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheet
(In thousands of dollars)
August 31, May 31,
1995 1994
(Unaudited) (Audited)
Current assets:
Cash and equivalents $ 30,290 $ 43,413
Temporary investments 126,693 116,574
Receivables, less allowance 117,576 115,037
Inventories 174,891 164,238
Prepaid expenses and deferred income taxes 10,505 10,587
Total current assets 459,955 449,849
Property, plant and equipment, at cost,
less accumulated depreciation 66,175 62,728
Other assets, at cost, less accumulated
amortization 44,805 43,451
$ 570,935 $ 556,028
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Payables $ 34,265 $ 29,291
Accrued liabilities 38,476 26,171
Total current liabilities 72,741 55,462
Deferred income taxes 20,469 20,469
Long-term debt 6,500 6,500
Shareholders' Equity:
Serial preferred stock, without par value;
1,500,000 shares authorized but unissued - -
Common stock, without par value;
stated value $1 per share; 100,000,000
shares authorized, 87,076,327
issued 87,076 87,076
Retained earnings 479,320 460,393
Foreign currency translation adjustment 1,288 1,384
Treasury shares at cost (3,945,612 and
3,073,732 shares at August 31, 1995 and
May 31, 1995, respectively) (96,459) (75,256)
471,225 473,597
$ 570,935 $ 556,028
See accompanying Notes to Consolidated Financial Statements.
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PREMIER INDUSTRIAL CORPORATION AND SUBSIDIARIES
Consolidated Statement of Cash Flows
(Unaudited)
(In thousands of dollars)
Three Months Ended
August 31,
1995 1994
Cash and equivalents at beginning of period $ 43,413 $ 42,122
Cash flows from operating activities:
Net earnings 28,167 25,392
Adjustments to reconcile net earnings
to net cash provided by operating activities:
Depreciation and amortization 2,321 2,044
Deferred income taxes - 1,610
Changes in:
Receivables (2,539) 223
Inventories (10,653) (6,285)
Prepaid expenses 82 (296)
Payables 6,129 4,791
Accrued liabilities 12,305 13,015
Other (2,721) (660)
Net cash provided by operating activities 33,091 39,834
Cash flows from investing activities:
Net additions to property, plant and
equipment (5,670) (3,298)
Purchase of temporary investments (187,243) (241,026)
Sale of temporary investments 177,124 224,555
Other 20 (107)
Net cash used in investing activities (15,769) (19,876)
Cash flows from financing activities:
Dividends paid (9,240) (8,484)
Purchase of treasury shares (21,208) (2,327)
Proceeds from stock plans 3 19
Net cash used in financing activities (30,445) (10,792)
Cash and equivalents at end of period $ 30,290 $ 51,288
See accompanying Notes to Consolidated Financial Statements.
<PAGE>
PREMIER INDUSTRIAL CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
1. The accompanying unaudited consolidated financial statements contain
all adjustments (consisting only of normal recurring adjustments) which,
in the opinion of management, are necessary to present fairly the
consolidated financial position of Premier Industrial Corporation and
subsidiaries (the "Company") as of August 31, 1995 and the results of
their operations and cash flows for the three month periods ended
August 31, 1995 and 1994.
2. The Company's inventories consist primarily of finished goods. Cost of
certain inventories is determined using the dollar value LIFO method.
If all inventory costs were determined on a FIFO basis, inventories
would have been $6,646,000 and $7,111,000 higher than reported at
August 31, 1995 and May 31, 1995, respectively.
<PAGE>
Item 2 - Management's Discussion and Analysis of Financial
Condition and Results of Operations
Results Of Operations
First Quarter Ended August 31, 1995 versus First Quarter Ended
August 31, 1994
Operating revenues of $213,854,000 were 8%, or $15,482,000, ahead of the
$198,372,000 reported for the same period last year. The increase in
revenues reflects continued gains in both business segments as a result of,
among other things, good demand and expanded product offerings.
Other income increased $1,259,000 mainly due to increased investment income
on a higher level of cash and temporary investments. Cost of sales of
$119,049,000 increased 10%, primarily related to the revenue gain and changes
in product mix. Selling, administrative, and general expenses remained under
good control, increasing only 3%, or $1,604,000. Higher levels of payroll
and operating costs relating to the increased sales activity, partially
offset by expense control efforts, accounted for the majority of the
increase.
Primarily as a result of the above-noted factors, net earnings increased
11%, while earnings per share rose 13%.
Liquidity, Capital Resources and Cash Flows (Financial Condition)
The Company continues to maintain a solid financial condition. At
August 31, 1995, working capital was $387,214,000 compared with $394,387,000
at May 31, 1995. The ratio of current assets to current liabilities was
6.3 to 1 at August 31, 1995. The Company requires significant funds to
carry extensive product inventories, as product availability and customer
service, including rapid delivery, are key factors in maintaining a strong
competitive position in each business segment. In addition, the Company
maintains cash and invested funds to meet growth opportunities, including
business expansion, new division start-ups and acquisitions, and to have
internal capital available for distribution to shareholders. The Company
continues to develop growth plans and to search for suitable acquisitions.
The Company's long-term debt of $6,500,000 in variable rate Industrial
Development Bonds continues to represent less than 2% of total
capitalization at August 31, 1995.
The Company's principal source of cash continues to be that provided by
operating activities. Net cash provided by operating activities fluctuates
as a result of variations in operating income, receivable and inventory
levels and the timing of payment of liabilities and taxes. The Company
expects that net earnings generally will provide sufficient cash to meet
the Company's presently anticipated needs for cash, including funds for
investing and financing activities.
Net cash used in investing activities during the first three months of
fiscal 1996 consisted principally of a net increase of $10,119,000 in
temporary investments retained for future business use. Net cash used in
financing activities for the three-month period included cash dividends
paid to shareholders of $9,240,000. During the quarter, the Company
purchased approximately 872,000 of its shares for $21,208,000. As a
result of these activities, coupled with cash generated from operations,
cash and equivalents decreased $13,123,000.
<PAGE>
PART II - OTHER INFORMATION
Item 6 - Exhibits and Reports on Form 8-K
(a) Exhibits. None.
(b) Reports on Form 8-K. No reports on Form 8-K were filed during the
quarter ended August 31, 1995.
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 thereunto duly authorized.
Date: October 9, 1995 PREMIER INDUSTRIAL CORPORATION
(Registrant)
/s/ Philip S. Sims
Philip S. Sims, Vice Chairman of the Board
(Principal Financial Officer and Duly
Authorized Signatory on Behalf of
Registrant)
<PAGE>
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