<PAGE> 1
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 quarterly period ended JUNE 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 is 0-4197
UNITED STATES LIME & MINERALS, INC.
-----------------------------------
(Exact name of registrant as specified in its charter)
TEXAS 75-0789226
----- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
12221 MERIT DRIVE, SUITE 500, DALLAS, TX 75251
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(214) 991-8400
--------------
(Registrant's telephone number, including area code)
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
----- -----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: As of July 12, 1996,
3,921,853 shares of common stock, $.10 par value, were outstanding.
<PAGE> 2
PART I. FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS
UNITED STATES LIME & MINERALS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands of dollars)
(Unaudited)
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
ASSETS 1996 1995
------------ -------------
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 541 $ 1,161
Trade receivables 7,023 5,509
Inventories 5,516 5,332
Prepaid expenses and other assets 783 234
------------ -------------
Total current assets 13,863 12,236
------------ -------------
Property, plant and equipment at cost: 56,801 53,927
Less accumulated depreciation (39,240) (37,503)
------------ -------------
Net property, plant and equipment 17,561 16,424
------------ -------------
Other assets, net 1,181 1,133
------------ -------------
Total assets $ 32,605 $ 29,793
============ =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current installments of long-term debt $ 1,143 $ 1,143
Accounts payable-trade 3,171 2,568
Accrued expenses 2,356 2,369
------------ -------------
Total current liabilities 6,670 6,080
Long-term debt, excluding current installment 4,459 4,381
Other liabilities 578 583
Stockholders' equity:
Common stock 529 529
Additional paid-in capital 15,306 15,848
Retained earnings 19,625 17,844
------------ -------------
35,460 34,221
Less treasury stock at cost;
1,372,212 and 1,458,002 shares of common stock (14,562) (15,472)
------------ -------------
Total stockholders' equity 20,898 18,749
------------ -------------
Total liabilities and stockholders' equity $ 32,605 $ 29,793
============ =============
</TABLE>
See accompanying notes to condensed consolidated financial statements
2
<PAGE> 3
UNITED STATES LIME & MINERALS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands of dollars, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
June 30, 1996 June 30, 1995 June 30, 1996 June 30, 1995
---------------- --------------- --------------- --------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues $ 11,583 100.0% $ 11,458 100.0% $ 20,106 100.0% $20,107 100.0%
Cost of revenues:
Labor and other operating expenses 7,549 65.2% 7,536 65.7% 13,421 66.8% 13,464 67.0%
Depreciation, depletion and amortization 971 8.4% 774 6.8% 1,812 9.0% 1,576 7.8%
---------------- --------------- --------------- --------------
8,520 73.6% 8,310 72.5% 15,233 75.8% 15,040 74.8%
---------------- --------------- --------------- --------------
GROSS PROFIT 3,063 26.4% 3,148 27.5% 4,873 24.2% 5,067 25.2%
Selling, general and admin. expenses 1,153 9.9% 1,179 10.3% 2,258 11.2% 2,397 11.9%
---------------- --------------- --------------- --------------
OPERATING PROFIT 1,910 16.5% 1,969 17.2% 2,615 13.0% 2,670 13.3%
---------------- --------------- --------------- --------------
Other deductions (income):
Interest expense 162 1.4% 177 1.6% 296 1.4% 352 1.7%
Other, net (71) -0.6% 2 0.0% (129) -0.6% (7) -0.0%
---------------- --------------- --------------- --------------
91 0.8% 179 1.6% 167 0.8% 345 1.7%
---------------- --------------- --------------- --------------
NET INCOME BEFORE INCOME TAXES 1,819 15.7% 1,790 15.6% 2,448 12.2% 2,325 11.6%
Federal and state income taxes 348 3.0% 350 3.1% 474 2.4% 459 2.3%
---------------- --------------- --------------- --------------
NET INCOME $ 1,471 12.7% $ 1,440 12.6% 1,974 9.8% 1,866 9.3%
======== ======== ======== =======
NET INCOME PER SHARE:
Primary $ 0.38 $ 0.38 $ 0.51 $ 0.49
======== ======== ======== =======
Fully diluted $ 0.36 $ - $ 0.49 $ -
======== ======== ======== =======
</TABLE>
See accompanying notes to condensed consolidated financial statements.
3
<PAGE> 4
UNITED STATES LIME & MINERALS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands of dollars)
(Unaudited)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
----------------------
June 30,
1996 1995
-------- --------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 1,974 $ 1,866
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation, depletion and amortization 1,813 1,648
Amortization of financing costs 50 37
Loss on sale of property - 28
Current assets (net change) [1] (2,247) (1,172)
Other assets (98) (166)
Current liabilities (net change) [2] 590 1,101
Other liabilities (5) 371
-------- --------
Net cash provided by operating activities 2,077 3,713
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment (2,950) (3,117)
Proceeds from sale of property, plant and equipment - 10
-------- --------
Net cash (used in) investing activities (2,950) (3,107)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of stock options 368 -
Payment of common stock dividends (193) (95)
Proceeds from borrowings 650 1,600
Principal payments of debt (572) (1,471)
-------- --------
Net cash (used in) financing activities 253 34
-------- --------
Net increase (decrease) in cash (620) 640
Cash at beginning of period 1,161 23
-------- --------
Cash at end of period $ 541 $ 663
======== ========
Supplemental cash flow information:
Interest paid $ 227 $ 311
======== ========
Income taxes paid $ 531 $ 297
======== ========
</TABLE>
[1] Exclusive of net change in cash.
[2] Exclusive of net change in debt and lease obligations.
See accompanying notes to condensed consolidated financial statements.
4
<PAGE> 5
UNITED STATES LIME & MINERALS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
1. Basis of Presentation
The condensed consolidated financial statements included
herein have been prepared by the Company without independent
audit. In the opinion of the Company's management, all
adjustments of a normal and recurring nature necessary to
present fairly the financial position, results of operations
and cash flows for the periods presented have been made.
Certain information and footnote disclosures normally included
in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted.
It is suggested that these condensed consolidated financial
statements be read in conjunction with the consolidated
financial statements and notes thereto included in the
Company's Annual Report on Form 10-K for the period ended
December 31, 1995. The results of operations for the periods
ended June 30, 1996 are not necessarily indicative of what the
operating results for the full year will be. Certain prior
year amounts have been reclassified for comparison purposes.
2. Inventories
Inventories consist of the following at:
<TABLE>
<CAPTION>
June 30, December 31,
1996 1995
------------- --------------
(In thousands of dollars)
<S> <C> <C>
Raw materials $ 774 $ 1,000
Finished goods 2,787 2,436
Service parts 1,955 1,896
------------- ------------
Total Inventories $ 5,516 $ 5,332
============= ============
</TABLE>
3. Prepaid Expenses
At June 30, 1996, prepaid expenses included $353,000 of
deferred costs that will be absorbed in inventory by the end
of the year based on units of production method. The
deferred costs at June 30, 1995 were $216,000. The 1996 costs
relate to a planned aggregates production shut-down of one of
the plant facilities during the first quarter of 1996.
Deferred costs include maintenance and other expenses incurred
during the first quarter that will contribute towards revenues
in subsequent quarters.
5
<PAGE> 6
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
Net cash provided by operating activities was $2,077,000 for the
six months ended June 30, 1996, as compared to $3,713,000 for the six
months ended June 30, 1995. The decrease in net cash provided by
operating activities was primarily attributed to the increase in
current assets and reductions of current liabilities. The Company has
in place and utilizes its Revolver Loan facility to cover these
fluctuations.
The Company has completed the feasibility studies for a new kiln at
the Arkansas plant and has decided to proceed with this project. The
new kiln will complement the existing shaft kilns by allowing the
Company to expand its customer base. The lime produced on the new
kiln will meet the specific chemical needs of both the existing
customer base and customers the Company currently is unable to serve.
The project is expected to cost approximately $9-10 million. The
Company's progress on this project has been slowed due to the state
regulatory authorities requiring the Arkansas plant to apply for and
obtain a new plant-wide permit. The new permit replaced the existing
permit and now allows the Company to proceed with the permitting
process of the new kiln. This permit is expected to be secured by the
end of 1996. The new kiln will be financed by internally generated
funds and/or alternative sources of financing.
RESULTS OF OPERATIONS
Revenues increased from $11,458,000 in the second quarter of 1995 to
$11,583,000 in the second quarter of 1996, an increase of $125,000 or
1.1%. This resulted from a 3.2% decrease in sales volume and a 4.3%
increase in prices. Revenues for the six months ended June 30, 1996
of $20,106,000 were almost identical to last year's revenues of
$20,107,000 for the same period. This was caused by a 5.5% decrease
in sales volume and a 5.5% increase in price.
The Company's gross profit was $3,063,000 in the second quarter of
1996, compared to $3,148,000 in the second quarter of 1995, a 2.7%
decrease. Gross profit margin for the second quarter of 1996
decreased to 26.4%, from 27.5% in 1995. The lower gross profit and
gross profit margins were attributed to decreased production volumes
in the second quarter. Gross profit decreased to $4,873,000 for the
first six months of 1996, from $5,067,000 in the first six months of
1995, a 3.8% decrease. Gross profit margin for the six months ended
June 30, 1996 decreased to 24.2%, from 25.2% in 1995. The decreased
production volumes negatively impacted both gross profit and gross
profit margins.
Selling, general and administrative expenses (SG&A) decreased 2.2% to
$1,153,000 in the second quarter of 1996, compared to $1,179,000 in
the second quarter of 1995. SG&A as a percentage of sales decreased
to 9.9%, from 10.3% a year earlier. The reduction in SG&A was due
primarily to lower professional fees. SG&A decreased by $139,000 or
5.8%, in the first six months of 1996, compared to 1995, and as a
percentage of sales decreased to 11.2%, from 11.9%.
6
<PAGE> 7
Other, net increased by $73,000 in the second quarter of 1996,
compared to the second quarter of 1995. The increase was mainly due
to the sale of timber at one of the plants and royalties from a lease
agreement signed in the first quarter. Other, net increased by
$122,000 in the first six months of 1996, as compared to the first six
months of 1995.
Interest expense decreased both in the second quarter and first six
months of 1996 over 1995 by $15,000 and $56,000, respectively. This
decrease was due primarily to lower balances outstanding.
The Company reported net income of $1,471,000, ($0.38 per share /
$0.36 fully diluted) during the second quarter of 1996, compared to
net income of $1,440,000, ($0.38 per share) during the second quarter
of 1995. For the first six months of 1996, the Company recorded net
income of $1,974,000 ($0.51 per share / $0.49 fully diluted), as
compared to net income of $1,866,000 ($0.49 per share) in the first
six months of 1995.
PART II. OTHER INFORMATION
ITEM 4: SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Annual Meeting of Shareholders was held on May 17, 1996, in
Dallas, Texas. The table below briefly describes the proposal
submitted to Shareholders in the Company's Proxy Statement dated March
22, 1996, and the results of the Shareholder vote:
Election of Directors
<TABLE>
<CAPTION>
FOR WITHHELD
--- --------
<S> <C> <C>
John J. Brown 3,718,218 6,786
Timothy W. Byrne 3,721,468 3,536
Antoine M. Doumet 3,720,718 4,286
Wallace G. Irmscher 3,721,568 3,436
Robert F. Kizer 3,721,564 3,440
Edward A. Odishaw 3,721,568 3,436
Robert J. Smith 3,718,218 6,786
</TABLE>
There were no broker non-votes.
ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits:
11 Statement re computation of per share earnings
27 Financial Data Schedule
b. Reports on Form 8-K:
The Company filed no Reports on Form 8-K during the quarter
ended June 30, 1996.
7
<PAGE> 8
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 STATES LIME & MINERALS, INC.
July 18, 1996 By:/s/ Robert F. Kizer
-------------------------------------
Robert F. Kizer
President and Chief Executive Officer
July 18, 1996 By:/s/ Timothy W. Byrne
-------------------------------------
Timothy W. Byrne
Senior Vice President
and Chief Financial Officer
8
<PAGE> 9
UNITED STATES LIME & MINERALS, INC.
Quarterly Report on Form 10-Q
Quarter Ended
June 30, 1996
Index to Exhibits
Exhibit No. Exhibit
----------- ----------------------------------------------
11 Statement re computation of per share earnings
27 Financial Data Schedule
<PAGE> 1
Exhibit 11
STATEMENT RE COMPUTATION
OF PER SHARE EARNINGS
<TABLE>
<CAPTION>
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
--------------------------- -------------------------
1996 1995 1996 1995
------------ --------- ---------- ---------
<S> <C> <C> <C> <C>
Net income $ 1,471,000 1,440,000 1,974,000 1,866,000
=========== ========= ========= =========
Net income per share: (1)
Primary $ 0.38 0.38 0.51 0.49
=========== ========= ========= =========
Fully diluted $ 0.36 - 0.49 -
=========== ========= ========= =========
Weighted average
shares outstanding: (1)
Primary 3,872,073 3,836,063 3,859,097 3,836,063
=========== ========= ========= =========
Fully diluted 4,031,202 - 4,018,225 -
=========== ========= ========= =========
</TABLE>
(1) The Company is showing both primary and fully diluted earnings per
share for the second quarter and first half of 1996. These
calculations, required under generally accepted accounting principles,
reflect the effects of recent increases in the market prices for the
Company's shares in determining the dilution resulting from the
assumed exercise of the Company's employee stock options.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> APR-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 541
<SECURITIES> 0
<RECEIVABLES> 7,023
<ALLOWANCES> 0
<INVENTORY> 5,516
<CURRENT-ASSETS> 13,863
<PP&E> 56,801
<DEPRECIATION> 39,240
<TOTAL-ASSETS> 32,605
<CURRENT-LIABILITIES> 6,670
<BONDS> 0
<COMMON> 529
0
0
<OTHER-SE> 20,369
<TOTAL-LIABILITY-AND-EQUITY> 32,605
<SALES> 11,583
<TOTAL-REVENUES> 11,583
<CGS> 8,520
<TOTAL-COSTS> 8,520
<OTHER-EXPENSES> 1,082
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 162
<INCOME-PRETAX> 1,819
<INCOME-TAX> 348
<INCOME-CONTINUING> 1,471
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,471
<EPS-PRIMARY> .38
<EPS-DILUTED> .36
</TABLE>
