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 13 weeks ended March 30, 1996
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: (847) 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 May 9, 1996, 61,899,455 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
March 30, 1996 and April 1, 1995................. 2
Condensed Consolidated Balance Sheet
(Unaudited) as of March 30, 1996 and
December 30, 1995................................ 3
Condensed Consolidated Statement of Cash Flows
(Unaudited) for the 13 week periods ended
March 30, 1996 and April 1, 1995................. 5
Notes to Condensed Consolidated
Financial Statements (Unaudited)................. 6
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 general 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 30, 1995.
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
-------------------
March 30, April 1,
1996 1995
-------- --------
(In millions, except per share data)
Net sales................................... $ 528.7 $ 519.6
-------- --------
Costs and expenses:
Cost of products sold..................... 340.7 333.1
Delivery, sales, and
administrative expense.................. 163.6 158.1
Interest expense.......................... 5.7 5.6
Interest income........................... (0.2) (0.4)
Other income, net......................... (0.1) -
-------- --------
Total costs and expenses............... 509.7 496.4
-------- --------
Income before income taxes.................. 19.0 23.2
Provision for income taxes.................. 7.2 9.0
-------- --------
Income from continuing operations........... 11.8 14.2
Income from discontinued operations......... 32.8 32.3
-------- --------
Net income.................................. 44.6 46.5
Retained earnings, beginning of period...... 735.7 579.8
Cash dividends declared..................... (16.6) (12.2)
Cost of treasury stock issued
in excess of option exercise prices....... (12.0) (2.7)
-------- --------
Retained earnings, end of period............ $ 751.7 $ 611.4
======== ========
Income per common and common
equivalent share:
Continuing operations................... $ 0.19 $ 0.22
Discontinued operations................. 0.52 0.49
-------- --------
Net income per common and
common equivalent share................... $ 0.71 $ 0.71
======== ========
Average number of
common and common equivalent
shares outstanding........................ 63.2 65.3
======== ========
Dividends declared per common share......... $ 0.27 $ 0.20
======== ========
See accompanying Notes to Condensed Consolidated Financial Statements
(Unaudited).
- 2 -
<PAGE>
PREMARK INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
ASSETS
(UNAUDITED)
March 30, December 30,
1996 1995
--------- ---------
(In millions)
Cash and cash equivalents.................. $ 18.1 $ 19.8
Accounts and notes receivable.............. 360.5 397.5
Less allowances for
doubtful accounts...................... (20.0) (19.7)
--------- ---------
340.5 377.8
Inventories................................ 353.8 347.6
Recoverable income taxes................... 12.7 12.3
Deferred income tax benefits............... 74.9 77.2
Prepaid expenses........................... 47.0 45.0
--------- ---------
Total current assets................... 847.0 879.7
--------- ---------
Property, plant, and equipment............. 948.0 939.0
Less accumulated depreciation............ (525.2) (514.3)
--------- ---------
422.8 424.7
Intangibles, net of accumulated
amortization............................. 167.2 168.7
Other assets............................... 75.0 73.0
Net assets of discontinued operations...... 471.8 415.2
--------- ---------
Total assets........................... $1,983.8 $1,961.3
========= =========
See accompanying Notes to Condensed Consolidated Financial Statements
(Unaudited).
- 3 -
<PAGE>
PREMARK INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
LIABILITIES AND SHAREHOLDERS' EQUITY
(UNAUDITED)
March 30, December 30,
1996 1995
--------- ---------
(In millions)
Accounts payable........................... $ 96.2 $ 104.4
Short-term borrowings and current
portion of long-term debt................ 165.0 133.0
Accrued liabilities........................ 350.5 365.7
--------- ---------
Total current liabilities.............. 611.7 603.1
--------- ---------
Long-term debt............................. 121.6 121.7
Accrued postretirement benefit cost........ 121.8 120.1
Other liabilities.......................... 91.4 107.6
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............................ 590.3 590.3
Retained earnings.......................... 751.7 735.7
Treasury stock, 7,280,287 shares at
March 30, 1996 and 7,857,080 shares
at December 30, 1995, at cost............ (240.4) (258.0)
Unearned portion of restricted
stock issued for future service.......... (1.5) (1.0)
Cumulative foreign currency adjustments.... (131.8) (127.2)
--------- ---------
Total shareholders' equity............. 1,037.3 1,008.8
--------- ---------
Total liabilities and
shareholders' equity................. $1,983.8 $1,961.3
========= =========
See accompanying Notes to Condensed Consolidated Financial Statements
(Unaudited).
- 4 -
<PAGE>
PREMARK INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
13 Weeks Ended
-------------------
March 30, April 1,
1996 1995
-------- --------
(In millions)
Cash flows from operating activities:
Net income................................ $ 44.6 $ 46.5
Adjustments to reconcile net income to
net cash provided by (used in)
operating activities from continuing
operations:
Income from discontinued operations... (32.8) (32.3)
Depreciation and amortization......... 17.4 17.6
Changes in assets and liabilities:
Decrease in accounts
and notes receivable................ 34.8 30.5
Increase in inventory................. (7.8) (34.1)
Decrease in accounts payable
and accrued liabilities............. (19.2) (40.8)
Decrease in income taxes payable...... (0.1) (5.7)
Decrease (increase) in
deferred income taxes............... 1.1 (1.4)
Increase in prepaid expenses.......... (2.1) (4.2)
Other, net................................ (11.6) (8.5)
-------- --------
Net cash provided by (used in)
operating activities from
continuing operations.............. 24.3 (32.4)
-------- --------
Cash flows from investing activities:
Capital expenditures...................... (15.3) (17.5)
Other..................................... (0.3) (5.6)
-------- --------
Net cash used in investing
activities from continuing
operations......................... (15.6) (23.1)
-------- --------
Cash flows from financing activities:
Net increase in short-term debt........... 32.6 184.0
Repayment of long-term debt............... (0.2) (0.2)
Proceeds from exercise of stock options... 9.7 2.7
Purchase of treasury stock................ (7.3) (147.3)
Payment of dividends...................... (16.6) (12.8)
-------- --------
Net cash provided by financing
activities from continuing
operations......................... 18.2 26.4
-------- --------
Effect of exchange rate changes on cash
and cash equivalents...................... (0.3) 1.0
Net cash (used in) provided by
discontinued operations................... (28.3) 23.6
-------- --------
Net decrease in cash and
cash equivalents.......................... $ (1.7) $ (4.5)
======== ========
See accompanying Notes to Condensed Consolidated Financial Statements
(Unaudited).
- 5 -
<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 the 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. 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):
March 30, December 30,
1996 1995
----------- -----------
Finished goods.................. $ 177.1 $ 169.8
Work in process................. 45.2 37.9
Raw materials and supplies...... 131.5 139.9
-------- --------
Total inventories $ 353.8 $ 347.6
======== ========
Note 3: Pro Rata Distribution of Tupperware Stock
On November 1, 1995, the company's board of directors authorized
management to establish its Tupperware business 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 favorable outcome of
a ruling requested from the Internal Revenue Service as to the
qualification of the Distribution as a tax-free event or the receipt
of an acceptable opinion from outside legal counsel as to the non-
taxability of the event. The Distribution is expected to be effected
by the end of the second quarter of 1996. Net sales of Tupperware
were $329.5 million and $330.1 million for the 13 week periods ended
March 30, 1996 and April 1, 1995, respectively. As of March 30, 1996
and April 1, 1995, respectively, Tupperware had $152.0 million and
$85.7 million of net current assets.
Under the Distribution Agreement, immediately prior to the
Distribution, Dart Industries Inc., a subsidiary of Tupperware, will
pay a special dividend to Premark. While the amount of this dividend
is dependent upon Premark's financial position immediately prior to
the Distribution, it would have been $218.4 million at March 30, 1996,
based on Premark's financial condition at that date. Had the dividend
occurred as of the end of the first quarter of each year, Premark's
total debt less cash would have been $50 million as of both March 30,
1996 and April 1, 1995. If the Distribution had occurred as of the
beginning of the first quarter of 1996 and 1995, pro forma interest
expense and net income would have been $2.4 million and $13.9 million,
respectively, in 1996, and $3.6 million and $15.4, respectively, in
1995.
- 6 -
<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 ended March 30, 1996, compared with the 13 weeks ended April 1,
1995, and changes in financial condition during the 13 weeks ended
March 30, 1996.
Overall
In late 1995, the company's board of directors authorized management
to proceed with a plan to establish Tupperware as an independent
company through a stock distribution to Premark's shareholders. The
Distribution is subject to final approval by the board of directors
and the favorable outcome of a ruling requested from the Internal
Revenue Service as to the qualification of the Distribution as a tax-
free event or the receipt of an acceptable opinion from outside legal
counsel as to the non-taxability of the event. The Distribution is
expected to be effected by the end of the second quarter of 1996.
Tupperware has been reported as a discontinued operation in these
financial statements.
Net Income
Net income decreased 4 percent to $44.6 million, or 19 cents per
share, in 1996 from $46.5 million, or 22 cents per share, in 1995.
Continuing Operations
Net Sales and Income from Operations
Net sales from continuing operations for the first quarter of 1996
were $528.7 million, an increase of nearly 2 percent compared with net
sales of $519.6 million in 1995. Improvements at Precor, Wilsonart
and Hartco were mostly offset by declines at Florida Tile and West
Bend. The Food Equipment Group segment was essentially flat as a
decline in Europe was offset by growth in the other foreign and U.S.
regions.
Income from continuing operations decreased 17 percent to $11.8
million, or 19 cents per share, in 1996 from $14.2 million, or 22
cents per share, in 1995. The decrease in 1996's first quarter
reflects a significant decrease in segment profit at the Food
Equipment Group, which includes a $1.9 million provision for a
European reduction in force, and at Florida Tile. Partially
offsetting these factors was a return to profitability of West Bend as
well as a sharp increase in the profitability of Precor. Prior year's
results for West Bend included an $8 million pretax provision for a
product recall. Absent that provision, West Bend would have reported
a substantial shortfall from 1995.
Costs and Expenses
Cost of products sold as a percentage of net sales was 64.4 percent
for the first quarter of 1996 compared with 64.1 percent in the first
quarter of 1995. Delivery, sales, and administrative expenses as a
percentage of net sales was 30.9 percent in 1996, comparable with 30.4
percent in the first quarter of 1995.
Tax Rate
The effective tax rate was 38.0 percent for the first quarter of 1996,
compared with 38.8 percent for the first quarter of 1995, and 34.4
percent for the year ended December 30, 1995. The lower 1995 rate
primarily reflects a change in the estimate of the cost of
repatriating foreign earnings to the United States, as well as the
impact of lower foreign income taxes.
Net Interest Expense
Interest expense, net of interest income, was $5.5 million in the
first quarter of 1996 versus $5.2 million in the first quarter of
1995. Net interest expense reflects interest accrued and earned on
all of Premark's borrowings and invested cash, excluding amounts that
are owed or held by Tupperware, respectively.
The special dividend to be paid to Premark by Dart immediately prior
to the Distribution, as described in Note 3 to the condensed
consolidated financial statements, will be used to substantially
reduce Premark's outstanding debt.
Segment results
Food Equipment Group
Net sales for the first quarter of 1996 were $293.1 million, an
increase of less than 1 percent compared with $291.5 million in 1995.
Growth in the U.S. and other foreign operations was almost entirely
offset by declines in most European operations. Segment profit was
$12.7 million, a decrease of 36 percent from $19.7 million reported in
1995, driven by declines in Europe and the United States.
International operations accounted for 41 percent of segment sales and
none of the segment profit for the quarter.
U.S. sales rose 1 percent to $172.0 million as a stronger foodservice
market was offset by the absence of sales arising from the 1994
nutritional label law changes. Segment profit fell, however, by 14
percent from the first quarter of 1995. An unfavorable sales mix and
lower production volume drove the decline.
European sales were down 3 percent for the first quarter despite the
addition of Ungermann, which was acquired in the second quarter of
1995, as a result of difficult economies in most markets as well as
the unfavorable impact of foreign exchange. Excluding both
acquisition and foreign exchange impacts, European sales dropped 7
percent for the quarter. A segment loss was incurred in the quarter,
versus a segment profit in 1995. Lower sales and production volumes,
increased operating expenses from the inclusion of Ungermann and a
$1.9 million provision for a reduction in force all contributed to the
loss.
Sales of the other international operations grew by almost 15 percent
in the first quarter. The addition of Brazil, plus improvements in
Japan, Australia and Mexico, more than offset a slight decline in
Canada. Segment profit for the first quarter grew substantially over
a breakeven position last year driven by higher pricing in Canada,
sales related gains in Australia and Japan, and lower foreign exchange
losses in Mexico.
Decorative Products
Net sales were $176.2 million for the first quarter of 1996, an
increase of almost 4 percent compared with $170.3 million in 1995.
However, segment profit for the quarter was $12.3 million, a decrease
of 22 percent from $15.8 million in 1995. Wilsonart's sales in 1996
were almost 4 percent ahead of 1995, reflecting slightly higher sales
prices offset by slightly lower volume. Segment profit for the
quarter decreased slightly, as the higher sales prices were offset by
the impact of lower production volume as well as marketing expenses
associated with new product development. Florida Tile's sales for the
quarter declined modestly, reflecting competitive pricing pressures
and lower volume. The unit reported a segment loss for the quarter
versus a profit in 1995. Lower sales as well as higher manufacturing
costs contributed to the decrease. Hartco sales for the quarter grew
significantly, driven by higher volume in the do-it-yourself channel.
A breakeven segment profit was reported versus a slight segment profit
in 1995, as a result of unfavorable sales mix and higher manufacturing
costs.
Consumer Products
Net sales were $59.4 million for the first quarter of 1996, an
increase of nearly 3 percent compared with $57.8 million in 1995.
Segment profit for the quarter was $4.1 million versus a loss last
year of $2.0 million. Last year's results include an $8 million
charge for a bread maker recall by West Bend.
West Bend's sales declined 12 percent from 1995. Housewares sales
fell significantly due to a soft retail environment and lower volume
and competitive pricing of bread makers. Direct-to-the-home cookware
sales increased significantly, but did not offset the shortfall at
Housewares. Segment profit increased substantially due to the bread
maker provision made in 1995. Excluding that charge, profits fell
significantly compared with 1995, due to the lower sales and
production volumes in Housewares. Precor had substantial growth in
sales on the strength of a pickup in both the retail and commercial
markets as well as the introduction of new products. The unit's
segment profit improved substantially from 1995 as a result of the
higher volume.
Discontinued Operations (Tupperware)
Net Sales and Income from Operations
Net sales for the first quarter of 1996 were $329.5 million, $0.7
million or 0.2 percent lower than 1995 sales of $330.1 million.
Income from operations increased by $0.5 million to $32.8 million,
which was a 2 percent improvement from 1995 income from operations of
$32.3 million. The modest variations from the prior year reflect
lower performance by Europe, Africa and the Middle East, which was
offset by improvement in all other regions. The only region in which
foreign exchange had a significant impact on the year-to-year
variation was Asia Pacific.
Costs and Expenses
The cost of products sold in relation to sales was 36.6 percent and
34.5 percent in 1996 and 1995, respectively. The 1996 increase
reflects a lower level of U.S. production to more closely match sales
demand, and higher product costs in Latin America due to increased
third party product sourcing. Delivery, sales and administrative
expense as a percentage of sales was 49.4 percent in 1996 compared
with 52.3 percent in 1995. The improvement was due to lower
promotional spending and operating expenses in the Americas and Asia
Pacific.
Tax Rate
The effective tax rate for the first quarter of 1996 was 26.7 percent,
compared with effective tax rates of 24.4 percent for the first
quarter and all of 1995. The increase in the rate is due to the
absence of the 1995 benefit from the resolution of certain tax audit
contingencies and a lower 1996 benefit from repatriating foreign
earnings. These factors were only partially offset by the 1996
benefit from reducing the valuation allowance for U.S. federal
deferred tax assets.
Net Interest
In the first quarters of 1996 and 1995, Tupperware had net interest
income of $0.3 million and $0.7 million, respectively. As a
subsidiary of Premark, Tupperware's income only reflects interest on
legal obligations owed or on amounts held by Tupperware. As outlined
above, Dart will pay a special dividend to Premark immediately prior
to the Distribution, which will substantially increase the debt of
Tupperware.
Regional Results
Europe, Africa and the Middle East
Sales decreased by 15 percent in the first quarter of 1996 to $146.8
million from $173.4 million in 1995. The decrease resulted from
reduced volume in Germany, reflecting weak economic conditions. The
region's sales represented 45 percent and 52 percent of Tupperware's
total sales in the first quarter of 1996 and 1995, respectively.
Segment profit in the region was $30.2 million in 1996, which
represented a $13.8 million, or 31 percent, decrease compared with
1995's segment profit of $44.0 million. The decrease reflects the
lower sales in Germany.
The Americas
Sales in the Americas totaled $106.0 million in the first quarter of
1996, which was a 25 percent improvement compared with 1995 sales of
$84.8 million. Segment profit in 1996 was $7.3 million compared with
a loss of $1.6 million in 1995. The region's sales accounted for 32
percent and 26 percent of Tupperware's total in 1996 and 1995,
respectively.
U.S. sales were $43.8 million in 1996, $0.8 million higher than 1995
sales of $43.0 million. However, the U.S. segment loss decreased
sharply to $2.0 million in 1996 from $4.6 million in 1995, reflecting
a more efficient use of promotional expenditures and a lower
administrative cost structure. During the quarter, the U.S. business
implemented several strategic initiatives to simplify operations,
increase sales force productivity and improve profitability.
In the Americas, excluding the United States, sales increased by 51
percent to $62.2 million in 1996 from $41.2 million in 1995. Mexico
was the biggest factor in the improvement, where sales increased
sharply. Sales in Brazil increased substantially, with the
improvements in both Mexico and Brazil resulting from successful
programs to boost the size of the sales force. Segment profit in the
Americas, excluding the United States, rose by $6.2 million to $9.2
million in 1996 from $3.0 million in 1995. Substantial improvements
in Mexico and Brazil, reflecting the higher sales, were the largest
factors in the increase. Also, Argentina had a profit in 1996 versus
a loss in 1995, reflecting higher volume from a much larger sales
force and lower selling and administrative costs.
Asia Pacific
Sales in Asia Pacific were $76.2 million in 1996, which was an
improvement of $4.2 million or 6 percent, from 1995 sales of $72.0
million. Foreign exchange had a $4.2 million negative impact on the
comparison. Excluding foreign exchange, sales in Japan increased
significantly due to the impact in 1995 of the Kobe earthquake.
However, the negative impact of foreign exchange in Japan offset a
large part of the increase. Sales in Korea increased substantially,
but Taiwan had a significant sales decrease. The sales fluctuations
were due to an increase in the size of the active sales force in Korea
and a decrease in Taiwan, reflecting the results of recruiting
programs in those countries. The region's sales represented 23
percent and 22 percent of Tupperware's total sales in the first
quarter of 1996 and 1995, respectively.
Segment profit in the region increased by 87 percent to $9.3 million
in 1996 from $5.0 million in 1995. Foreign exchange had a minor
impact on the comparison. A substantial increase in Korea and a sharp
improvement in Japan, reflecting the higher sales along with the
absence of costs related to the 1995 earthquake in Japan, were the
main reasons for the increase. Taiwan's segment profit fell
substantially as a result of its lower sales.
Financial Condition of Premark
Under the Distribution Agreement between Premark, Tupperware and Dart,
immediately prior to the Distribution, Dart will pay a special
dividend to Premark. The amount of the special dividend is dependent
upon Premark's financial position immediately prior to the
Distribution. Based upon Premark's financial position as of March 30,
1996, the dividend would have been calculated to be $218.4 million on
that date.
Net cash provided by operating activities in the first quarter of 1996
was $24.3 million compared with a use of cash of $32.4 million in the
first quarter of 1995. The higher cash generation in 1996 primarily
reflects a smaller increase in inventories and a smaller decrease in
accounts payable and accrued liabilities than in 1995.
Net cash used in investing activities was primarily for capital
expenditures and totaled $15.6 million and $23.1 million in 1996 and
1995, respectively. Cash provided by financing activities was $18.2
million in the first quarter of 1996 versus $26.4 million in the first
quarter of 1995. The large variation in the net decrease in short
term debt primarily reflects the financing of a higher level of
working capital in 1995 as well as the funding for the stock
repurchase program last year.
The total debt-to-capital ratio, including debt of discontinued
operations, at the end of the first quarter of 1996 was 25.4 percent,
compared with 32.3 percent at the end of the first quarter of 1995,
and 25.1 percent as of December 30, 1995. The lower ratio as of
March 30, 1996, compared with last year's first quarter, reflects a
paydown of borrowings with cash generated by operating activities plus
the effect of net income on the ratio.
Working capital as of March 30, 1996, decreased by $41.3 million from
December 30, 1995. The largest change among the components of working
capital was a decrease in accounts and notes receivable.
As of March 30, 1996, the company had unused lines of credit of $689.6
million, of which $199.9 million was foreign lines for Tupperware. Of
the $489.7 million of lines of credit for continuing operations, $250
million was under an unsecured revolving credit facility, which
expires in May, 1999. Prior to the Distribution, Premark expects to
enter into a new credit agreement that, along with continuing
uncommitted lines of credit and other borrowing sources, is 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, prior to March 30, 1996, and May 10, 1996, the company had
repurchased 588,000 shares at an average cost of $51 per share,
including repurchases in 1996 of 92,000 shares at an average cost of
$50 per share. Share repurchases have been suspended pending the
upcoming spinoff of Tupperware. Subsequent to the Distribution, both
Premark and Tupperware will evaluate whether to implement share
repurchase programs.
<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 first quarter of
1996 is filed as an exhibit to this Report
(b) Reports on Form 8-K
During the quarter, the Registrant did not file any current
reports on Form 8-K.
<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: Lawrence B. Skatoff
-------------------------
Senior Vice President and
Chief Financial Officer
Deerfield, Illinois
May 10, 1996
Exhibit 11
PREMARK INTERNATIONAL, INC.
Statement of Computation of Per Share Earnings
(Unaudited)
13 Weeks Ended
-------------------
March 30, April 1,
1996 1995
(Dollars in millions, shares in thousands) -------- --------
Earnings
Income from continuing operations $ 11.8 $ 14.2
Income from discontinued operations 32.8 32.3
-------- --------
Net income $ 44.6 $ 46.5
======== ========
PRIMARY METHOD
Shares
Cumulative average outstanding shares 61,409 62,839
Common equivalent shares 1,785 2,417
-------- --------
Weighted average number of common
shares and common equivalent
shares outstanding 63,194 65,256
======== ========
Primary earnings per share:
Continuing operations $ 0.19 $ 0.22
Discontinued operations 0.52 0.49
-------- --------
Net income per share $ 0.71 $ 0.71
======== ========
FULLY DILUTED METHOD
Shares
Cumulative average outstanding shares 61,409 62,839
Common equivalent shares 1,805 2,430
-------- --------
Weighted average number of common
shares and common equivalent
shares outstanding 63,214 65,269
======== ========
Fully diluted earnings per share:
Continuing operations $ 0.19 $ 0.22
Discontinued operations 0.52 0.49
-------- --------
Net income per share $ 0.71 $ 0.71
======== ========
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM PREMARK
INTERNATIONAL, INC.'S FIRST QUARTER 1996 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> 3-MOS
<FISCAL-YEAR-END> DEC-28-1996
<PERIOD-START> DEC-31-1995
<PERIOD-END> MAR-30-1996
<CASH> 18,100
<SECURITIES> 0
<RECEIVABLES> 360,500
<ALLOWANCES> 20,000
<INVENTORY> 353,800
<CURRENT-ASSETS> 847,000
<PP&E> 948,000
<DEPRECIATION> 525,200
<TOTAL-ASSETS> 1,983,800
<CURRENT-LIABILITIES> 611,700
<BONDS> 121,600
0
0
<COMMON> 69,000
<OTHER-SE> 968,300
<TOTAL-LIABILITY-AND-EQUITY> 1,983,800
<SALES> 528,700
<TOTAL-REVENUES> 528,700
<CGS> 340,700
<TOTAL-COSTS> 340,700
<OTHER-EXPENSES> (100)
<LOSS-PROVISION> 1,100
<INTEREST-EXPENSE> 5,700
<INCOME-PRETAX> 19,000
<INCOME-TAX> 7,200
<INCOME-CONTINUING> 11,800
<DISCONTINUED> 32,800
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 44,600
<EPS-PRIMARY> .71
<EPS-DILUTED> 0
</TABLE>
