UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the 39 weeks ended September 30, 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 1-9256
__________________
PREMARK INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Delaware 36-3461320
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1717 Deerfield Road, Deerfield, Illinois 60015
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (708)
405-6000
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_______
As of November 10, 1995, 61,211,645 shares of the Common Stock,
$1.00 par value, of the Registrant were outstanding.
<PAGE>
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements
a) Financial Statements of Registrant
Page
Index Number
Condensed Consolidated Statement of Income
(Unaudited) for the 13 week periods ended
September 30, 1995 and October 1, 1994........... 2
Condensed Consolidated Statement of Income
(Unaudited) for the 39 week period ended
September 30, 1995 and the 40 week period
ended October 1, 1994............................ 3
Condensed Consolidated Balance Sheet
(Unaudited) as of September 30, 1995 and
December 31, 1994................................ 4
Condensed Consolidated Statement of Cash Flows
(Unaudited) for the 39 week period ended
September 30, 1995 and the 40 week period
ended October 1, 1994............................ 6
Notes to Condensed Consolidated
Financial Statements (Unaudited)................. 7
The condensed consolidated financial statements of the
Registrant included herein have been prepared, without audit,
pursuant to the rules and regulations of the Securities and
Exchange Commission. Although certain information normally
included in financial statements prepared in accordance with
generally accepted accounting principles has been condensed or
omitted, the Registrant believes that the disclosures are
adequate to make the information presented not misleading. It
is suggested that these condensed consolidated financial
statements be read in conjunction with the financial statements
and the notes thereto included in the Annual Report on Form 10-K
of the Registrant for its fiscal year ended December 31, 1994.
The condensed consolidated financial statements included herein
reflect all adjustments, consisting only of normal recurring
items, which, in the opinion of management, are necessary to
present a fair statement of the results for the interim periods
presented.
The results for interim periods are not necessarily indicative
of trends or of results to be expected for a full year.
<PAGE>
PREMARK INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
13 Weeks Ended
------------------
Sept. 30, Oct. 1,
1995 1994<F1>
(In millions, except per share data) -------- --------
Net sales.................................... $ 848.6 $ 812.2
-------- --------
Costs and expenses:
Cost of products sold...................... 465.5 448.8
Delivery, sales, and
administrative expense................... 313.2 302.7
Interest expense........................... 8.0 6.1
Interest income............................ (1.5) (1.2)
Other expense, net......................... 1.8 0.2
-------- --------
Total costs and expenses................ 787.0 756.6
-------- --------
Income before income taxes................... 61.6 55.6
Provision for income taxes................... 14.8 14.7
-------- --------
Net income................................... 46.8 40.9
Retained earnings, beginning of period....... 656.7 482.9
Cash dividends declared...................... (16.5) (12.7)
Cost of treasury stock issued
in excess of option exercise proceeds...... (4.0) (2.9)
-------- --------
Retained earnings, end of period............. $ 683.0 $ 508.2
======== ========
Net income per common and
common equivalent share.................... $ 0.74 $ 0.62
======== ========
Average number of common and common
equivalent shares outstanding.............. 63.5 66.4
======== ========
Dividends declared per common share.......... $ 0.27 $ 0.20
======== ========
<F1> Net sales and cost of products sold have been restated to
reflect the reclassification of certain promotional items
from delivery, sales, and administrative expense.
See accompanying Notes to Condensed Consolidated Financial
Statements (Unaudited).
- 2 -
<PAGE>
PREMARK INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
39 Weeks 40 Weeks
Ended Ended
Sept. 30, Oct. 1,
1995 1994<F1>
(In millions, except per share data) --------- ---------
Net sales.................................. $2,588.2 $2,421.0
--------- ---------
Costs and expenses:
Cost of products sold.................... 1,376.9 1,314.2
Delivery, sales, and
administrative expense................. 971.2 904.7
Interest expense......................... 22.2 18.4
Interest income.......................... (4.7) (4.1)
Other expense, net....................... 0.8 2.1
--------- ---------
Total costs and expenses.............. 2,366.4 2,235.3
--------- ---------
Income before income taxes................. 221.8 185.7
Provision for income taxes................. 61.4 50.1
--------- ---------
Net income................................. 160.4 135.6
Retained earnings, beginning of period..... 579.8 418.7
Cash dividends declared.................... (45.2) (34.3)
Cost of treasury stock issued
in excess of option exercise proceeds.... (12.0) (11.8)
--------- ---------
Retained earnings, end of period........... $ 683.0 $ 508.2
========= =========
Net income per common and
common equivalent share.................. $ 2.51 $ 2.04
========= =========
Average number of common and common
equivalent shares outstanding............ 64.0 66.5
========= =========
Dividends declared per common share........ $ 0.74 $ 0.54
========= =========
<F1> Net sales and cost of products sold have been restated to
reflect the reclassification of certain promotional items
from delivery, sales, and administrative expense.
See accompanying Notes to Condensed Consolidated Financial
Statements (Unaudited).
- 3 -
<PAGE>
PREMARK INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
ASSETS
(Unaudited)
Sept. 30, Dec. 31,
1995 1994
(In millions) --------- ---------
Cash and cash equivalents.............. $ 88.8 $ 120.8
Accounts and notes receivable.......... 563.8 509.1
Less allowances for
doubtful accounts.................. (45.5) (43.5)
--------- ---------
518.3 465.6
Inventories............................ 597.7 512.5
Deferred income tax benefits........... 125.7 120.9
Prepaid expenses....................... 72.9 54.3
--------- ---------
Total current assets................. 1,403.4 1,274.1
--------- ---------
Investments, long-term receivables,
and deferred charges................. 210.1 217.5
Less allowances for
doubtful accounts.................. (28.9) (22.7)
--------- ---------
181.2 194.8
Property, plant and equipment.......... 1,857.5 1,753.2
Less accumulated depreciation........ (1,128.2) (1,041.4)
--------- ---------
729.3 711.8
Intangibles, less accumulated
amortization......................... 175.6 177.2
--------- ---------
Total assets........................... $2,489.5 $2,357.9
========= =========
See accompanying Notes to Condensed Consolidated Financial
Statements (Unaudited).
- 4 -
<PAGE>
PREMARK INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
LIABILITIES AND SHAREHOLDERS' EQUITY
(Unaudited)
Sept. 30, Dec. 31,
(Dollars in millions 1995 1994
except per share amounts) --------- --------
Accounts payable......................... $ 175.7 $ 218.8
Short-term borrowings and current
portion of long-term debt.............. 206.5 83.6
Accrued liabilities...................... 630.3 618.2
--------- ---------
Total current liabilities.............. 1,012.5 920.6
--------- ---------
Long-term debt........................... 197.6 122.3
Accrued postretirement
benefit cost........................... 155.1 151.4
Deferred income taxes.................... 13.1 9.9
Other liabilities........................ 155.2 181.4
Shareholders' equity:
Preferred stock, $1.00 par value,
authorized 50,000,000 shares;
issued -- none....................... - -
Common stock, $1.00 par value,
authorized 200,000,000 shares;
issued -- 69,003,840 shares.......... 69.0 69.0
Capital surplus........................ 571.7 571.7
Retained earnings...................... 683.0 579.8
Treasury stock, 7,806,575 shares
at September 30, 1995, and 5,105,347
shares at December 31, 1994,
at cost.............................. (247.5) (125.6)
Unearned portion of restricted
stock issued for future service...... (1.0) (0.3)
Cumulative foreign currency
adjustments.......................... (119.2) (122.3)
--------- ---------
Total shareholders' equity............. 956.0 972.3
--------- ---------
Total liabilities and
shareholders' equity................. $2,489.5 $2,357.9
========= =========
See accompanying Notes to Condensed Consolidated Financial
Statements (Unaudited).
- 5 -
<PAGE>
PREMARK INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
39 Weeks 40 Weeks
Ended Ended
Sept. 30, Oct. 1,
1995 1994
(In millions) --------- ---------
Cash flows from operating activities:
Net income............................ $ 160.4 $ 135.6
Adjustment to reconcile net
income to net cash provided
by operating activities:
Depreciation and amortization..... 98.4 91.7
Changes in assets and liabilities:
Increase in accounts
and notes receivable............ (45.2) (19.4)
Increase in inventory............. (80.3) (66.9)
Decrease in accounts payable
and accrued liabilities......... (64.7) (5.4)
(Decrease) increase in
income taxes payable............ (13.7) 3.5
Increase in deferred
income taxes.................... (4.0) (2.7)
Decrease (increase) in
prepaid expenses................ 3.3 (36.6)
Other................................. 0.5 (3.8)
-------- --------
Net cash provided by
operating activities............ 54.7 96.0
-------- --------
Cash flows from investing activities:
Capital expenditures.................. (106.2) (98.5)
Other................................. (5.0) (9.4)
-------- --------
Net cash used in
investing activities............ (111.2) (107.9)
-------- --------
Cash flows from financing activities:
Net increase
in short-term debt.................. 200.6 158.1
Repayment of long-term debt........... (0.1) (151.1)
Proceeds from exercise of
stock options....................... 9.1 8.9
Purchase of treasury stock............ (148.1) (49.8)
Payment of dividends.................. (41.5) (30.6)
-------- --------
Net cash provided by (used in)
financing activities............ 20.0 (64.5)
-------- --------
Effect of exchange rate changes on
cash and cash equivalents.......... 4.5 (2.2)
-------- --------
Net decrease in cash
and cash equivalents............... $ (32.0) $ (78.6)
======== ========
See accompanying Notes to Condensed Consolidated Financial
Statements (Unaudited).
- 6 -
<PAGE>
PREMARK INTERNATIONAL, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1: Basis of Presentation
The accompanying unaudited condensed consolidated financial
statements have been prepared in accordance with the instructions
to Form 10-Q and therefore do not include all information and
footnotes necessary for a fair presentation of financial
position, results of operations, and changes in financial
position in conformity with generally accepted accounting
principles. In the opinion of management, the unaudited
condensed consolidated financial statements include all
adjustments, consisting only of normal recurring items, necessary
for a fair presentation of financial position and results of
operations. The results of operations of any interim period are
not necessarily indicative of the results that may be expected
for a full fiscal year.
Premark's (the Company) fiscal year ends on the last Saturday of
December. Fiscal 1995 will consist of 52 weeks compared with 53
weeks in 1994. As a result, the first three quarters include 39
weeks in 1995 compared with 40 weeks in 1994. Certain prior year
amounts have been reclassified to conform with the current year's
presentation.
Note 2: Inventories
Inventories, by component, are summarized as follows (in
millions):
September 30, December 31,
1995 1994
-------- --------
Finished goods.................... $ 310.2 $ 257.0
Work in process................... 80.2 62.5
Raw materials and supplies........ 207.3 193.0
-------- --------
Total inventories............. $ 597.7 $ 512.5
======== ========
Note 3: Stock Repurchase
In August 1995, the Company announced the authorization by its board of
directors of the repurchase of 6 million of its shares of common stock,
with volume and timing to depend on market conditions. The shares
acquired will be used for general corporate purposes. Through September
30, 1995, and November 10, 1995, 30,000 shares and 110,000 shares at an
average cost of $52 and $50, respectively, had been repurchased under
this program. The Company completed its previous share repurchase,
which was announced in May 1993, in March 1995. Under that program 6
million shares were repurchased including 3,396,600 shares in 1995's
first quarter.
Note 4: Pro Rata Distribution of Tupperware Stock
On November 1, 1995, the Company's board of directors authorized
management to establish its Tupperware subsidiary as an independent
company through a stock distribution to Premark shareholders. The
distribution is subject to approval by the board of directors of
definitive agreements for the separation and the outcome of a ruling
request from the Internal Revenue Service as to the qualification of the
distribution as a tax-free event.
- 7 -
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
The following is a discussion of the results of operations for the 13
weeks and 39 weeks ended September 30, 1995, compared with the 13 weeks
and 40 weeks ended October 1, 1994, and changes in financial condition
during the 39 weeks ended September 30, 1995. The prior year's first
three quarters included 40 weeks because the Company's fiscal year ends
on the last Saturday of December and included 53 weeks in 1994. Certain
prior year amounts have been reclassified to conform with the current
year's presentation.
Net Sales
Net sales for the third quarter of 1995 were $848.6 million, an increase
of almost 5 percent compared with net sales of $812.2 million in 1994.
In the first nine months of 1995, net sales rose to $2.6 billion, which
was an improvement of 7 percent from 1994's net sales of $2.4 billion.
All three segments contributed to the net sales increases for both the
three and nine month periods, with the Food Equipment Group and
Tupperware accounting for the majority of the improvement.
Costs and Expenses
Cost of products sold as a percentage of net sales was 54.9 percent for
the third quarter of 1995 compared with 55.2 percent for the third
quarter of 1994. For the first three quarters, the rate was 53.2
percent in 1995 and 54.3 percent in 1994. The decreases result from the
absence of 1994's provision for adhesive claims at Wilsonart. Delivery,
sales, and administrative expense as a percentage of net sales was 36.9
percent in 1995's third quarter compared with 37.3 percent in 1994. For
the year to date period, the rates were 37.5 percent and 37.4 percent in
1995 and 1994, respectively.
Provision for Income Taxes
The effective tax rate for the third quarter and first three quarters of
1995 was 24.1 percent and 27.7 percent, respectively, compared with 26.5
percent and 27.0, respectively in the 1994 periods and 27.5 percent for
all of 1994. The lower rate for the third quarter of 1995 reflects the
favorable resolution of certain tax contingencies.
Net Income
Net income for the third quarter of 1995 rose 15 percent to $46.8
million, or 74 cents per share, from $40.9 million, or 62 cents per
share in 1994. For the first three quarters of 1995, net income rose to
$160.4 million, or $2.51 per share, from $135.6 million, or $2.04 per
share in 1994. For the quarter, the improvement was led by Tupperware's
international operations along with the absence of 1994's provision by
Wilsonart for adhesives claims. These favorable factors were only
partially offset by a loss at Tupperware U.S. due to lower sales, lower
volume at Wilsonart, and higher interest expense. The year-to-date
increase reflects improvement at Tupperware Latin America and Europe and
the Food Equipment Group in the U.S., improved profitability at Florida
Tile, and the absence of the Wilsonart adhesive provision. Partially
offsetting these factors were the impact of lower volume at Tupperware
U.S. and Wilsonart and the first quarter provision for the West Bend
bread maker recall. Foreign exchange accounted for 4 percentage points
of the 18 percent increase for the first three quarters, and was not
significant in the quarterly comparison.
Segment Results
Tupperware
Net sales for the third quarter of 1995 were $292.3 million, an increase
of 4 percent from $280.1 million in 1994. The 1995 increase was from
improvement internationally, which offset a decline in the U.S. For the
first three quarters, net sales increased 8 percent from $898.7 million
in 1994 to $973.3 million in 1995. The increase was primarily due to
favorable foreign exchange in Europe and Asia Pacific, along with
improved operating performance in Latin America, partially offset by a
decline in the United States. Tupperware's international operations
accounted for 85 percent of its sales in both the third quarter and
first three quarters of 1995.
Segment profit for the third quarter of 1995 was $25.3 million, a 3
percent improvement over $24.6 million last year. For the first three
quarters of 1995, segment profit was $134.1 million, an increase of 18
percent from $113.4 million in 1994. Excluding foreign exchange, profit
rose 9 percent and 12 percent in the third quarter and year-to-date
periods, respectively, on improved performance by international
operations, which was partially offset by losses in the U.S.
For the quarter, Tupperware's European sales increased 6 percent to
$107.1 million, and profits increased by 31 percent. Excluding foreign
exchange, sales were even with 1994 as volume related increases in
Austria, Italy, and some of the smaller markets were offset by lower
volume in Germany, France, and Scandinavia. Segment profit was 19
percent higher in 1995, after excluding the favorable impact of foreign
exchange, due to the benefit of lower regional administrative expenses
and a lower operating expense structure in the United Kingdom. Asia
Pacific sales increased 9 percent to $86.9 million, and segment profit
grew by 21 percent. The sales increase was mainly the result of higher
volume in Japan, the Philippines, and Korea. The profit increase
resulted from the higher sales volume, which outweighed higher operating
expenses in Japan and lower margins in the Philippines. The U.S., with
sales of $45.2 million in 1995, compared with $56.3 million in 1994, had
a segment loss of $4.6 million in 1995, compared with segment profit of
$2.5 million in 1994. The 1995 segment loss reflects lower volume from a
smaller, less productive sales force and ineffective promotions. Latin
American sales for the quarter rose 27 percent to $47.3 million. Profit
was up sharply due to continued strength in Brazil and Venezuela, and
despite the continuing impact of unfavorable foreign exchange rate
fluctuations in Mexico. In Mexico, sales were again significantly
higher in local currency terms as a result of strong promotional
programs and price increases, but dollar sales and segment profit were
both lower due to the peso's weakness.
For the first nine months, Tupperware Europe reported a 12 percent sales
increase to $421.2 million. After excluding the impact of foreign
exchange, sales were even with 1994 as increased volume in Germany,
Austria, Italy, and South Africa was offset by lower volume in the
United Kingdom, Scandinavia, and France. Segment profit rose by 29
percent in 1995. Excluding the impact of foreign exchange, segment
profit increased by 12 percent as a result of higher sales in Germany,
along with lower regional administrative expenses and a lower operating
expense structure in the United Kingdom. Asia Pacific sales increased
by 11 percent to $257.1 million primarily due to the weaker U.S. dollar,
but also as a result of higher volume in the Philippines, Korea, and
Malaysia. Segment profit rose by 9 percent, also from the effect of
foreign exchange fluctuations. Sales in the U.S. decreased by 7 percent
to $149.5 million and the segment loss was $1.3 million compared with
segment income of $5.6 million in 1995. The change from 1994 was
primarily from the weaker third quarter. Latin America had a sales
increase of 16 percent to $126.4 million, and segment profit improved by
54 percent, attributable to volume improvements in Brazil and Venezuela,
which more than offset a decline in Mexico in dollar terms.
Food Equipment Group
Net sales for the third quarter of 1995 were $310.8 million, an increase
of 5 percent compared with $295.4 million in 1994. The improvement for
the quarter was attributable to gains in most European operations and
the addition of Ungermann in Europe. For the first three quarters, net
sales increased by 11 percent from $826.7 million in 1994 to $914.9
million in 1995. The increase resulted from favorable foreign exchange
fluctuations and higher volume in both Europe and the U.S.
International operations accounted for 42 percent of segment sales in
both the third quarter and first three quarters of 1995.
For the third quarter, segment profit of $23.6 million was 3 percent
higher than 1994's $22.9 million. For the nine months, segment profit
grew to $64.7 million from $51.9 million in 1994 due to a significant
improvement in U.S. results. International operations accounted for 25
percent and 22 percent of segment profit for the third quarter and first
three quarters, respectively.
U.S. sales declined 1 percent in the third quarter and increased by 5
percent in the first three quarters. The decrease for the quarter was
from the absence of sales related to the 1994 nutritional label law
changes and a slightly softer foodservice market. For the first three
quarters, modest volume increases and nominal price increases accounted
for the improvement. Segment profit increased by 1 percent and 32
percent, respectively, over the third quarter and first three quarters
of 1994. The substantial improvement for the year-to-date period was
from the higher volume and nominal price increases.
European sales were up 18 percent and 22 percent, respectively, for the
third quarter and first three quarters, largely due to the Ungermann
acquisition and the favorable impact of foreign exchange. Excluding
both acquisition and foreign exchange impacts, sales increased by 6
percent for the quarter and 7 percent for the first three quarters as
sales improved throughout the region. Despite the sales improvements,
profits increased by only 1 percent and 6 percent for the quarter and
nine months, respectively, as the result of higher raw material and
production costs. Sales of the other international operations grew by 5
percent and 11 percent in the third quarter and first three quarters,
respectively. For the quarter, the addition of Brazil and improvement
in Canada were partially offset by a slowdown in Mexico and Japan. For
the nine month period, the improvement came from Australia, Canada,
Japan, and Brazil, which was only partially offset by weaker sales in
Mexico. Segment profit in the third quarter increased by 25 percent
from the prior year on improvement in Canada, but for the nine months
decreased by 1 percent as the result of the weakness in Mexico, which
more than offset improvements in Canada, Japan, and Australia.
Consumer and Decorative Products
Net sales were $245.5 million for the third quarter of 1995, an increase
of 4% compared with $236.7 million in 1994. For the first three quarters,
sales increased 1 percent from $695.6 million in 1994 to $700.0 million
in 1995. Segment profit for the quarter was $25.1 million, an increase
of 27 percent from $19.7 million in 1994. For the nine months, segment
profit grew 10 percent to $59.5 million from $54.2 million in 1994.
The third quarter sales growth was primarily from West Bend. Wilsonart
had slightly higher sales, while Florida Tile, Hartco, and Precor all
had slightly lower sales for the quarter. The improvement in third
quarter profit was primarily from the absence of Wilsonart's 1994
provision of $6 million for adhesive claims. Excluding this item,
segment profit declined by 2 percent from the effect of higher raw
material and marketing costs at Wilsonart and lower volume and higher
costs at Hartco and Precor. These factors more than offset the benefit
of lower costs at Florida Tile and the effect of higher volume at West
Bend.
West Bend also had a strong increase in sales for the nine month period.
This factor along with slightly higher sales at Wilsonart offset
decreases at Precor and Hartco resulting in the slight overall
improvement. The year-to-date profit improvement was due to the absence
of 1994's provision of $18 million for adhesives claims. Before
considering this benefit, profits decreased by 18 percent for the three
quarters from higher costs at Wilsonart, the $8 million provision in the
first quarter for West Bend's bread maker recall, and a volume related
decline at Precor. Lower costs at Florida Tile partially offset the
negative factors.
Financial Condition
Net cash provided by operating activities in the first three quarters of
1995 was $54.7 million compared with $96.0 million in the first three
quarters of 1994. The lower cash generation in 1995 primarily reflects
a larger increase in accounts receivable and a larger decrease in
accounts payable and accrued liabilities than in 1994, which more than
offset 1995's higher net income.
Net cash used in investing activities was primarily for capital
expenditures and totaled $111.2 million and $107.9 million in 1995 and
1994, respectively. Cash provided by financing activities was $20.0
million in the first three quarters of 1995 compared with cash used in
financing activities of $64.5 million in the first three quarters of
1994. The variation in net cash flows associated with financing
activities primarily reflects the financing of a higher level of working
capital in 1995 as compared with 1994.
The total debt-to-capital ratio at the end of the third quarter of 1995
was 29.7 percent, compared with 26.4 percent at the end of the third
quarter of 1994, and 17.5 percent as of December 31, 1994. The higher
ratio as of September 30, 1995, is mainly due to stock repurchases under
the Company's plans, which were funded through borrowings. This factor
more than offset the effect of net income on the ratio. As of September
30, 1995, $75 million of the Company's commercial paper borrowings were
classified as long term. This amount represents the portion of such
borrowings expected to be outstanding throughout the succeeding twelve
months. Working capital as of September 30, 1995, increased by $37.4
million from December 31, 1994. The most significant changes among the
components of working capital were increases in accounts and notes
receivable, inventories, and short-term borrowings, and a decrease in
accounts payable.
As of September 30, 1995, unused lines of credit were approximately $630
million, including $250 million under an unsecured revolving credit
facility that expires in May 1999. Future cash flows, lines of credit,
and other short-term financing are expected to be adequate to fund
operating and investing requirements.
In August 1995, the Company announced the authorization by its board of
directors of the repurchase of 6 million of its shares of common stock,
with volume and timing to depend on market conditions. Under this plan,
through September 30, 1995, and November 10, 1995, the Company had
repurchased 30,000 shares and 110,000 shares at an average cost of $52
and $50, respectively.
The Company's previous stock repurchase plan was announced in May 1993
and completed on March 14, 1995. Under the plan, the Company
repurchased a total of 6 million of its shares of common stock at an
average cost of $41 per share. Of the total, 3,396,600 shares at an
average cost of $42 per share were repurchased during the first quarter
of 1995.
<PAGE>
PART II
OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits (numbered in accordance with Item 601 of
Regulation S-K)
(11) A statement of computation of per share earnings
is filed as an exhibit to this Report.
(27) A Financial Data Schedule for the third fiscal
quarter of 1995 is filed as an exhibit to this
Report.
(b) Reports on Form 8-K
During the quarter, the Registrant filed the following
current report on Form 8-K:
Dated August 4, 1995, pertaining to the plan to repurchase
6 million shares of the Company's common stock.
<PAGE>
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.
PREMARK INTERNATIONAL, INC.
By: John M. Costigan
------------------------
Senior Vice President,
General Counsel and Secretary
By: Robert W. Hoaglund
------------------------
Vice President, Control
and Information Systems
(Principal Accounting Officer)
Deerfield, Illinois
November 14, 1995
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
(11) A statement of the computation
of per share earnings is filed
as an exhibit to this Report.
(27) A Financial Data Schedule for
the third fiscal quarter of 1995
is filed as an exhibit to this
Report.
Exhibit 11
PREMARK INTERNATIONAL, INC.
Statement of Computation of Per Share Earnings
(Unaudited)
13 Weeks Ended
-------------------
Sept. 30, Oct. 1,
1995 1994
(Dollars in millions, shares in thousands) -------- --------
Earnings $ 46.8 $ 40.9
======== ========
PRIMARY METHOD
Shares
Cumulative average outstanding shares 61,116 63,608
Common equivalent shares 2,376 2,822
-------- --------
Weighted average number of common
and common equivalent shares
outstanding 63,492 66,430
======== ========
Primary earnings per share $ 0.74 $ 0.62
======== ========
FULLY DILUTED METHOD
Shares
Cumulative average outstanding shares 61,116 63,608
Common equivalent shares 2,388 2,837
-------- --------
Weighted average number of common
and common equivalent shares
outstanding 63,504 66,445
======== ========
Fully diluted earnings per share $ 0.74 $ 0.62
======== ========
<PAGE>
Exhibit 11
PREMARK INTERNATIONAL, INC.
Statement of Computation of Per Share Earnings
(Unaudited)
39 Weeks 40 Weeks
Ended Ended
Sept. 30, Oct. 1,
1995 1994
(Dollars in millions, shares in thousands) -------- --------
Earnings $ 160.4 $ 135.6
======== ========
PRIMARY METHOD
Shares
Cumulative average outstanding shares 61,616 63,582
Common equivalent shares 2,390 2,948
-------- --------
Weighted average number of common
and common equivalent shares
outstanding 64,006 66,530
======== ========
Primary earnings per share $ 2.51 $ 2.04
======== ========
FULLY DILUTED METHOD
Shares
Cumulative average outstanding shares 61,616 63,582
Common equivalent shares 2,415 2,991
-------- --------
Weighted average number of common
and common equivalent shares
outstanding 64,031 66,573
======== ========
Fully diluted earnings per share $ 2.51 $ 2.04
======== ========
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM PREMARK INTERNATIONAL, INC.'S THIRD QUARTER 1995 FINANCIAL
STATEMENTS AS FILED IN ITS QUARTERLY REPORT ON FORM 10-Q AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-30-1995
<PERIOD-START> DEC-31-1994
<PERIOD-END> SEP-30-1995
<CASH> 88,800
<SECURITIES> 0
<RECEIVABLES> 563,800
<ALLOWANCES> 45,500
<INVENTORY> 597,700
<CURRENT-ASSETS> 1,403,400
<PP&E> 1,857,500
<DEPRECIATION> 1,128,200
<TOTAL-ASSETS> 2,489,500
<CURRENT-LIABILITIES> 1,012,500
<BONDS> 197,600
<COMMON> 69,000
0
0
<OTHER-SE> 887,000
<TOTAL-LIABILITY-AND-EQUITY> 2,489,500
<SALES> 2,588,200
<TOTAL-REVENUES> 2,588,200
<CGS> 1,376,900
<TOTAL-COSTS> 1,376,900
<OTHER-EXPENSES> 800
<LOSS-PROVISION> 9,200
<INTEREST-EXPENSE> 22,200
<INCOME-PRETAX> 221,800
<INCOME-TAX> 61,400
<INCOME-CONTINUING> 160,400
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 160,400
<EPS-PRIMARY> 2.51
<EPS-DILUTED> 0
</TABLE>
