<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment 1 on Form 10-Q/A *
Quarterly Report Under Section 13 or 15 (d)
of the Securities and Exchange Act of 1934
For the Quarter Ended March 31, 1997
Commission file number 0-4714
United Parcel Service of America, Inc.
(Exact name of registrant specified in its charter)
Delaware 95-1732075
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
55 Glenlake Parkway, NE
Atlanta, Georgia 30328
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code (404) 828-6000
Not Applicable
Former name, address and 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 and Exchange Act of 1934
during the preceding 12 months, and (2) has been subject to such filing
requirements of the past 90 days.
YES X NO
Common Stock, par value $.10 per share
(Title of Class)
570,000,000 shares
Outstanding as of May 14, 1997
* The purpose of this Amendment 1 on Form 10-Q/A is to amend Item 1 to
correct certain formatting errors.
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PART I. FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
UNITED PARCEL SERVICE OF AMERICA, INC., AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 31, 1997 (unaudited) and December 31, 1996
(In millions except share amounts)
ASSETS 1997 1996
------ ------
CURRENT ASSETS:
Cash and short-term investments $ 479 $ 392
Accounts receivable 2,352 2,341
Prepaid employee benefit costs 657 401
Materials, supplies and prepaid expenses 607 581
Common stock held for stock plans 475 540
------ ------
TOTAL CURRENT ASSETS 4,570 4,255
PROPERTY, PLANT AND EQUIPMENT (including aircraft
under capitalized lease obligations)- at
cost, net of accumulated depreciation and
amortization of $6,944 in 1997 and $6,778 in
1996 10,239 10,230
OTHER ASSETS 452 469
------ ------
$15,261 $14,954
LIABILITIES AND SHAREOWNERS' EQUITY ====== ======
CURRANT LIABILITIES:
Accounts payable $ 1,113 $ 1,155
Accrued wages and withholdings 1,033 1,201
Dividends payable - 194
Deferred income taxes 149 149
Other current liabilities 605 459
------ ------
TOTAL CURRENT LIABILITIES 2,900 3,158
LONG-TERM DEBT (including capitalized lease
obligations), net of current maturities
of $20 in 1997 and $18 in 1996 2,766 2,573
------ ------
ACCUMULATED POSTRETIREMENT BENEFIT
OBLIGATION, NET 869 841
------ ------
DEFERRED TAXES, CREDITS AND OTHER LIABILITIES 2,629 2,481
------ ------
SHAREOWNERS' EQUITY:
Preferred stock, no par value,
Authorized 200,000,000 shares, none issued - -
Common stock, par value $.10 per share,
Authorized 900,000,000 shares, issued
570,000,000, net of 10,000,000 in treasury 57 57
Additional paid-in capital 111 95
Retained earnings 5,956 5,728
Cumulative foreign currency adjustments (27) 21
------ ------
6,097 5,901
------ ------
$15,261 $14,954
====== ======
See notes to consolidated financial statements.
<PAGE>
UNITED PARCEL SERVICE OF AMERICA, INC., AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended March 31, 1997 and 1996
(in millions except per share amounts)
(unaudited)
Three Months Ended
1997 1996
------ ------
Revenue $ 5,664 $ 5,335
Operating Expenses:
Compensation and benefits 3,405 3,259
Other 1,833 1,651
----- -----
5,238 4,910
Operating Profit 426 425
------ ------
Other income and (expense):
Interest income 10 9
Interest expense (41) (23)
Miscellaneous, net (7) (9)
------ ------
(38) (23)
Income before income taxes 388 402
Income taxes 160 161
------ ------
Net income $ 228 $ 241
====== ======
Net income per share $ 0.40 $ 0.42
====== ======
See notes to consolidated financial statements.
<PAGE>
UNITED PARCEL SERVICE OF AMERICA, INC., AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREOWNERS' EQUITY
Three Months Ended March 31, 1997
(In millions)
(unaudited)
Cumulative
Additional Foreign Total
Common Stock Paid-In Retained Currency Shareowners'
Shares Amount Capital Earnings Adjustments Equity
Balance, January 1, 570 $57 $95 $5,728 $21 $5,901
1997
Net income - - - 228 - 228
Gain on issuance of
common stock held
for stock plans - - 16 - - 16
Foreign currency
adjustments - - - - (48) (48)
--- --- --- ------ ---- ------
Balance, March 31, 570 $57 $111 $5,956 $(27) $6,097
1997
See notes to consolidated financial statements.
<PAGE>
UNITED PARCEL SERVICE OF AMERICA, INC., AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Ended March 31, 1997 and 1996
(In millions)
(unaudited)
1997 1996
Cash flows from operating activities: ------- -------
Net income $ 228 $ 241
Adjustments to reconcile net income to net
cash provided from operating activities:
Depreciation and amortization 249 228
Postretirement benefits 28 26
Deferred taxes, credits, and other 140 74
Changes in assets and liabilities:
Accounts receivable (11) (129)
Prepaid employee benefit costs (256) (127)
Materials, supplies and prepaid
expenses (28) (92)
Common stock held for stock plans 65 24
Accounts payable (42) 87
Accrued wages and withholdings (168) (148)
Dividends payable (194) (178)
Other current liabilities 144 170
------ ------
Net cash provided from operating activities 155 176
------ ------
Cash flows from investing activities:
Capital expenditures (322) (318)
Disposals of property, plant and equipment 30 18
Other asset receipts 14 20
------ ------
Net cash (used in) investing activities (278) (280)
------ ------
Cash flows from financing activities:
Proceeds from borrowings 343 293
Repayment of borrowings (148) (56)
Other transactions 16 16
------ ------
Net cash provided from financing activities 211 253
------ ------
Effect of exchange rate changes on cash (1) (5)
------ ------
Net increase in cash and short-term investments 87 144
Cash and short-term investments:
Beginning of period 392 211
------ ------
End of period $ 479 $ 355
------ ------
Cash paid during the period for:
Interest (net of amount capitalized) $ 21 $ 4
====== ======
Income taxes $ 5 $ 30
====== ======
See notes to consolidated financial statements.
<PAGE>
UNITED PARCEL SERVICE OF AMERICA, INC., AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Three Months Ended March 31, 1997 and 1996
(unaudited)
1. For interim consolidated financial statement purposes, UPS computes its
tax provision on the basis of its estimated annual effective income tax rate,
and provides for accruals under its various employee benefit plans based on
one quarter of the estimated annual expense for each three month period.
Net income per share is based on 570,000,000 shares in 1997 and 1996,
including common stock held for stock plans.
2. In the opinion of management, the accompanying interim, unaudited,
consolidated financial statements contain all adjustments (consisting of
normal recurring accruals) necessary to present fairly the financial position
as of March 31, 1997, the results of operations for the three months ended
March 31, 1997 and 1996, and cash flows for the three months ended March 31,
1997 and 1996.
3. During the second quarter of 1995, the Company received a Notice of
Deficiency from the United States Internal Revenue Service (IRS) asserting
that it is liable for additional tax for the 1983 and 1984 tax years. The
Notice of Deficiency is based in large part on the theory that UPS is liable
for tax on income of Overseas Partners Ltd., a Bermuda company, which has
reinsured excess value package insurance purchased by UPS's customers from
unrelated insurers. The deficiency sought by the IRS relating to package
insurance is based on a number of inconsistent theories and ranges from $8
million to $35 million of tax, plus penalties and interest for 1984.
Agents for the IRS have also asserted in reports that UPS is liable for
additional tax for the 1985 through 1987 tax years. The additional tax sought
by the agents relating to package insurance for this period ranges from $89
million to $148 million, plus penalties and interest, and are based on the
same theories included in the above described Notice of Deficiency.
In addition, the IRS and its agents have raised a number of other issues
relating to the timing of deductions; the characterization of expenses as
capital rather than ordinary; and UPS's entitlement to the Investment Tax
Credit in the 1983 through 1987 tax years. These issues total $32 million
in tax for the 1983 and 1984 tax years and $95 million in tax for the 1985
through 1987 tax years. Penalties and interest are in addition to these
amounts. The majority of these adjustments would reverse in future years.
<PAGE>
UNITED PARCEL SERVICE OF AMERICA, INC., AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Three Months Ended March 31, 1997 and 1996
(unaudited)
In August 1995, the Company filed a petition in Tax Court in opposition
to the Notice of Deficiency related to the 1983 and 1984 tax years. The trial
date is set for September 8, 1997. After consultation with tax legal experts,
management believes there is no merit to any material issues raised by the IRS
and that the eventual resolution of these matters will not have a material
impact on the Company. The Company has appealed with the IRS all material
issues related to the 1985 through 1987 tax years. The IRS may take positions
similar to those in the reports described above for periods after 1987.
4. Certain prior period amounts have been reclassified to conform to the
current period presentation.
<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.
UNITED PARCEL SERVICE OF AMERICA, INC.
(Registrant)
By: __________________________
Maurice M. Agresta
Assistant Secretary and
Assistant Treasurer
Date: May 20, 1997
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<PERIOD-END> MAR-31-1997
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<PP&E> 17,183
<DEPRECIATION> 6,944
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<CURRENT-LIABILITIES> 2,900
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0
0
<COMMON> 57
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<SALES> 5,664
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<INCOME-TAX> 160
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