SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report: January 26, 1999
RALSTON PURINA COMPANY
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(Exact name of Registrant as specified in its charter)
MISSOURI 1-4582 No. 43-0470580
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(State or Other (Commission (IRS Employer
Jurisdiction of File Number) Identification Number)
Incorporation)
CHECKERBOARD SQUARE, ST. LOUIS, MISSOURI 63164
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(Address of Principal Executive Offices) (Zip Code)
(314) 982-1000
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(Registrant's telephone number, including area code)
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Item 5. Other Events
CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR"
PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995
Ralston Purina Company and its representatives may from time to time make
written or verbal statements, including statements regarding its businesses and
their respective markets, projections of future performance, statements of
management's plans and objectives, forecasts of market trends and other matters,
which to the extent they are not historical fact, may constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995. Such statements may be contained in the Company's filings with the
Securities and Exchange Commission, press releases, and written or oral
presentations made by representatives of the Company to analysts, rating
agencies, shareholders, news organizations and others. No assurance can be
given that the results in any forward-looking statements will be achieved and
actual results could be affected by one or more factors which could cause them
to differ materially. Therefore, the Company wishes to ensure that any written
or oral forward-looking statements made by it or on its behalf, are accompanied
by, or referenced to, meaningful cautionary statements in order to maximize to
the fullest extent possible the protections of the safe harbor established in
the Private Securities Litigation Reform Act of 1995.
All forward-looking statements made by or on behalf of the Company are
hereby qualified in their entirety by reference to the following important
factors, among others, that could affect the Company's businesses and cause
actual results to differ materially from those projected. Any forward-looking
statement speaks only as of the date on which such statement is made, and the
Company undertakes no obligation to update such statement to reflect events or
circumstances arising after such date.
General Business Considerations
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The Company's financial results can be significantly affected by general
economic conditions, inflationary pressures, high labor costs and unforeseen
changes in consumer demand or buying patterns. Potential limitations on the
Company's ability to generate sufficient internal cash flows, interest rate
fluctuations and other capital market conditions may negatively affect the
Company's ability to support capital expansion plans, share repurchase programs,
general operations and research and development and advertising and promotional
activities. Changes in accounting standards applicable to the Company may also
have a negative impact on its results of operations. Uncertainty surrounding
possible political candidates and elections in the year 2000, and other
political uncertainties, including the effects of the impeachment of President
Clinton, may have a negative impact on economic conditions, and the economic
crisis in the Asia Pacific and Latin American regions may result in a decline in
economic growth in the United States.
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Raw Materials
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Volatility in the market prices of commodities and other raw materials
utilized by the Company may negatively impact the Company's results of
operations, particularly if increases in such market prices cannot be passed on
by increases in the prices of the Company's products. Although the Company
tries to limit its exposure to changes in such market prices by hedging certain
of its ingredient requirements, there can be no assurance that such efforts will
be effective.
Competition
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The Company's businesses face intense product and price competition from
other global as well as regional and local manufacturers. To the extent
competitors are better able to manage expenses, whether by sourcing of lower
cost raw materials, lower labor or other operating expenses, or local currency
advantages, they could subject the Company to adverse pricing pressures. Other
competitive pressures, including, but not limited to, the introduction of new
technologies, industry consolidation, large-scale advertising or sales promotion
campaigns, consolidation of retailers and retail pressure from large-scale
buyers may affect the Company's ability to gain or maintain share of sales in
certain markets, and may materially affect operating results. Sales
reorganization activities or changes in promotional policies may result in
confusion or alienation among significant customers, which could have a negative
impact on sales. The sales decline of rechargeable batteries could continue as
lower-priced foreign competitors increase their share of that market and new
technologies emerge.
Foreign Sales
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A significant portion of the Company's revenues are generated from
international business operations. Changes in trade or monetary policies, rates
of taxation or tariffs and regulatory requirements of the United States and
other nations, as well as political, economic or social instability in certain
regions may affect the Company's international businesses. For the past several
years, negative economic and competitive conditions in Europe have significantly
affected battery product operations in that region, and more recent economic
upheavals in the Asia Pacific and Latin American regions, along with associated
currency devaluations, have had a negative effect on profitability in those
areas. Concerns associated with animal diseases such as BSE may affect sales of
pet products. Hyperinflationary conditions and exchange rate fluctuations in
particular countries may also affect the Company's overall financial
performance. The Company's plans to address issues involved with the
introduction of the Euro throughout the European Union may be inadequate to
address the complex impact of that introduction, and may be affected by economic
or political instability associated with the introduction.
Year 2000 Readiness
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The Company has developed plans and projects to achieve Year 2000
readiness. The evaluation and remediation process which the Company has
implemented may not be sufficiently timely or thorough to avoid major business
interruptions, given the difficulty, in particular, of dealing with imbedded
chip technologies. The remaining expenditures necessary to complete such plans
and projects may be more significant than the Company currently anticipates.
Because of the Company's inability to fully determine the readiness of all
critical suppliers and customers as well as governmental agencies, the failure
of any of such parties to achieve Year 2000 readiness may be more significant
than the Company presently projects.
Legal and Administrative Matters
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Although no significant litigation is now pending or threatened, legal and
administrative proceedings related to the operation of the Company's businesses,
including product liability claims, environmental claims and employment claims,
may be brought in the future, which could be adverse to the Company. The
Company maintains internal controls and compliance programs to prevent
violations which could give rise to such claims, but there can be no assurance
that such controls will be effective. In addition, new laws and regulations,
policies on enforcement, or judicial and administrative interpretations of
existing laws or regulations, may have an adverse impact on the Company's
results of operations.
Restructuring Activities
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The Company has announced plans to close various battery production
facilities and consolidate production capacity in remaining facilities, and has
recorded provisions for restructuring which have reduced current earnings. The
recorded provisions may not be sufficient to cover unanticipated expense which
may be generated by such restructuring, and additional charges may have to be
recorded. The Company may also be unable to realize the cost reductions and tax
and other benefits it anticipates from such restructuring. Significant
additional expenses or failure to achieve anticipated benefits resulting from
such restructuring may have an adverse effect on future financial results.
Company Investments
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In July of 1995, upon the sale of the Company's Continental Baking Company
subsidiary, the Company acquired approximately 47% of the outstanding common
stock of Interstate Bakeries Corporation, which the Company accounts for under
the equity method of accounting. The Company is required, by agreement with
Interstate, to dispose of all but 14.9% of the outstanding Interstate Stock by
July of 2000. In December of 1997, upon the sale of its international protein
technologies business, the Company acquired approximately 22.5 million shares of
the outstanding common stock of E.I. duPont de Nemours and Company. The market
prices of both the Interstate Stock and the DuPont Stock have generally
increased since their acquisition, although such prices have been subject to
market fluctuations. There can be no assurance that the past performance of
these investments will continue, nor that the Company will realize any gain in
the value of such investments at the time it elects to divest its shares of
Interstate Stock or DuPont Stock. The Company may also incur significant
capital gains tax upon their divestiture.
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Summary
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The foregoing list of potential risk factors is not exhaustive, and new
factors may emerge which could significantly impact the Company's businesses.
Such additional factors, including, but not limited to, factors discussed from
time to time in the Company's reports filed with the Securities and Exchange
Commission, could also affect the Company's actual results and cause those
results to differ materially from those expressed in any forward-looking
statements issued by the Company or its representatives. It is impossible for
the Company's management to predict such factors, or the likelihood of the
factors listed above, and therefore forward-looking statements should not be
relied upon as a prediction of actual future results.
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 hereunto duly authorized.
RALSTON PURINA COMPANY
By: /s/ James M. Neville
James M. Neville
Vice President and General Counsel
Dated: January 26, 1999