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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date or earliest event reported) March 17, 1995
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LDI CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 0-15994 31-1179824
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(State or other (Commission (IRS Employer
jurisdiction) File Number) Identification No.)
4770 Hinckley Industrial Parkway, Cleveland, Ohio 44109
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(Address of principal executive offices)(Zip Code)
Registrant's telephone number including area code (216) 661-5400
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Not Applicable
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS. On March 17, 1995, LDI Corporation ("LDI") issued a
press release which stated the following:
LDI CORPORATION TO TAKE SPECIAL CHARGES
CLEVELAND, Ohio--March 17, 1995--LDI Corporation (NASDAQ:LDIC)
today announced that it will record special charges for its fiscal
year ended January 31, 1995.
The charges are estimated to have an after-tax effect of
between $13 and $15 million. They result from fourth quarter actions
to revise residual values on certain categories of leased equipment,
adjust receivables and residual values for equipment leases to
customers with deteriorating credit quality, and reduce the valuation
for equipment in the Company's PC rental operation.
LDI's year-end financial statements are being finalized and
audited. This process of completing the financial results for the
fourth quarter and full fiscal year, and preparation of the annual
report on Form 10-K, will be completed during the next three to six
week period.
"The actions that resulted in the charges reflect the
Company's continued movement to more disciplined policies and
procedures," said Floyd S. Robinson, president and chief executive
officer. "We believe these efforts, which include refocusing on our
core business of equipment leasing, technology services and PC
rentals, position LDI to return to profitable growth."
"The strategic repositioning LDI has undergone in the past
year has made us a leaner, more focused company," said Robinson, who
was brought in as the Company's chief executive officer in August of
1994 as a part of the repositioning. "For our shareholders, the
result should be a more stable and predictable stream of earnings in
the future."
Organizational Progress
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LDI announced a major strategic repositioning in March 1994.
As part of that plan, the Company divested or exited a variety of
non-core businesses, including its wholesale and retail PC
distribution units. The divested businesses accounted for
approximately 40 percent of revenues and 10 percent of assets in the
prior fiscal year.
In conjunction with these divestitures and other cost-saving
measures in its core business, the Company also reduced its workforce
from approximately 900 employees to 330 employees.
Since these actions commenced, LDI has reduced its annualized
general and administrative costs in the core business by $8 million,
or 25%. Additionally, LDI has restructured operations, significantly
reduced its indebtedness and adopted more stringent operating
guidelines.
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Commenting on the special charges, Frank G. Skedel, who
assumed the position of executive vice president and chief financial
officer in July 1994, said, "During the fourth quarter we analyzed all
significant residual values of our leased equipment portfolio. We are
recording charges not only for the leases terminated during the
quarter, but also to write down residual values for similar equipment
leases which will expire in the future. We also are writing down the
carrying values of assets leased to certain customers with
deteriorated credit quality. Finally, we are reducing the value of
our PC rental equipment due to changes in technology which caused
declines in asset values and expected future rental revenue. These
special charges relate to events culminating during the fourth quarter
which affected previously recorded asset values. Approximately
one-half of the special charges relate to receivables and lease
residuals which will mature in future periods."
"We do not believe that these charges are indicative of future
operating results," said Skedel.
Robinson added, "Our senior recourse lenders have been
informed of the special charges and have revised LDI's loan agreements
to accommodate the impact of the charges."
Sea-Tech Sale Completed
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The Company also announced the completion of the sale of
Sea-Tech Communications, a venture providing ship-to-shore satellite
services to the cruise ship industry. Terms of the sale were not
disclosed. The Company did not incur any additional charge as a
result of the sale.
The core business of LDI Corporation, which was founded in
1972, is equipment leasing, related technology services for computers
and other high-technology equipment, and short-term PC rentals.
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.
LDI CORPORATION
By: Frank G. Skedel
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Frank G. Skedel
Executive Vice President,
Chief Financial Officer,
Treasurer and Secretary
Date: March 22, 1995
