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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 (Date of earliest event reported) March 9, 2000
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WRP Corporation
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(Exact name of registrant as specified in its charter)
Maryland 0-17458 73-1326131
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) Number)
500 Park Boulevard, Suite 1260, Itasca, Illinois 60143
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (630) 285-9191
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N/A
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS.
WRP Corporation (the "Company") has reported results for its fourth
quarter and year ended December 31, 1999. Net sales for the fourth quarter of
1999 were $17.3 million, a decrease of 3% below the prior year's fourth quarter
sales of $17.8 million. Net income for the quarter was $0.3 million, or $.04 per
diluted share, compared to $2.0 million, or $.29 per diluted share, in the same
prior year period.
Net sales for the year ended December 31, 1999 totaled $65.3 million,
an increase of less than 1% compared to the prior year sales of $65.0 million.
Net income for 1999 was $2.5 million, or $.35 per diluted share, compared to
$5.9 million, or $.93 per diluted share in the previous year period.
Gross profit margin for the 1999 year was 25.5% of sales compared to
27.9% in 1998, reflecting lower industry-wide selling prices caused by
over-capacity and competition in the marketplace. The impact on gross profit
margin was offset by lower cost of goods.
Earnings for the 1999 year were impacted by reduced profit margins, the
reduction in sales of $2.3 million in the second quarter for an inventory
consignment arrangement with a major customer and increased operating expenses.
Operating expenses during 1999 were $12.3 million compared to 1998 expenses of
$10.0 million. The increase was primarily the result of increased selling
expenses of $1.8 million due to the expansion in 1999 of the medical division
sales force and the addition of a telesales sales force. General and
administrative expenses increased $0.4 million in 1999, reflecting increased
depreciation and informational technology related expenses.
"Several aspects of our 1999 performance were strong," said Edward J.
Marteka, President of WRP Corporation and American Health Products Corporation.
"First, our unit growth in our medical division was a healthy 16% increase in
case volume over 1998 and our product mix continues to reflect increased
powder-free latex and synthetic gloves. The Amerinet contract, which was awarded
to American Health Products in 1999, contributed sales of over $1.0 million
during its launch period which commenced in the third quarter of 1999. We look
forward to rapid growth from this contract in 2000."
"We face challenges as a result of the loss of the Novation contract.
We have built solid customer relationships with end users and distributors which
will lessen the impact of the Novation contract termination. However, it is too
early to quantify the impact. We are aggressively seeking to penetrate new
segments of the marketplace to achieve a strengthened leadership position in the
glove market," said Mr. Marteka.
In addition to the Company's fourth quarter and year-end results, WRP
Corporation also announced that its Board of Directors has authorized a program
to repurchase up to 10% of the Company's public common stock. These purchases
may be made in the open market and in block transactions over a two-year period.
The program is subject to market conditions and its impact on share price as
well as other investment options that WRPC may consider to enhance shareholder
value.
"This repurchase program reflects our confidence in the success of the
Company's aggressive growth plans and the continued growth of the disposable
examination glove market," Mr. Marteka said. "The Board of Directors recognizes
that at current prices our common stock represents an attractive investment
opportunity, and we believe this repurchase program will assist WRPC in
maximizing shareholder value."
ITEM 8. CHANGE IN FISCAL YEAR.
2
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On March 4, 2000, the Company's Board of Directors approved a change in
the Company's fiscal year end to June 30, which corresponds to the year-end of
its majority shareholder, WRP Asia Pacific. This fiscal year-end change will be
effective June 30, 2000. The Company intends to file a Form 10-KSB covering the
transition.
3
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EXHIBITS
99. ADDITIONAL EXHIBITS.
1. Press Release dated March __, 2000.
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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.
WRP Corporation
(Registrant)
DATE: March 10, 2000 By: /s/ Edward J. Marteka
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Name: Edward J. Marteka
Title: President
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EXHIBIT 99.1
FOR IMMEDIATE RELEASE
WRP CORPORATION ANNOUNCES FOURTH QUARTER AND 1999 YEAR END RESULTS
ITASCA, IL, MARCH 9, 2000 - WRP Corporation (Nasdaq: WRPC), a leading
distributor and manufacturer of high quality, disposable latex and synthetic
gloves for the healthcare and foodservice industries, today reported results for
its fourth quarter and year ended December 31, 1999. Net sales for the fourth
quarter of 1999 were of $17.3 million, a decrease of 3% below the prior year's
fourth quarter sales of $17.8 million. Net income for the quarter was $0.3
million, or $.04 per diluted share, compared to $2.0 million, or $.29 per
diluted share, in the same prior year period.
Net sales for the year ended December 31, 1999 totaled $65.3 million, an
increase of less than 1% compared to the prior year sales of $65.0 million. Net
income for 1999 was $2.5 million, or $.35 per diluted share, compared to $5.9
million, or $.93 per diluted share in the previous year period.
Gross profit margin for the 1999 year was 25.5% of sales compared to 27.9% in
1998, reflecting lower industry-wide selling prices caused by over-capacity and
competition in the marketplace. The impact on gross profit market was offset by
lower cost of goods.
Earnings for the 1999 year were impacted by reduced profit margins, the
reduction in sales of $2.3 million in the second quarter for an inventory
consignment arrangement with a major customer, and increased operating expenses.
Operating expenses during 1999 were $12.3 million compared to 1998 of $10.0
million. The increase was primarily the result of increased selling expenses of
$1.8 million due to the expansion in 1999 of the medical division sales force
and the addition of a telesales sales force. General and administrative expenses
increased $0.4 million in 1999, reflecting increased depreciation and
informational technology related expenses.
"Several aspects of our 1999 performance were strong," said Edward J. Marteka,
President of WRP Corporation and American Health Products Corporation. "First,
our unit growth in our medical division was a healthy 16% increase in case
volume over 1998, and our product mix continues to reflect increased powder-free
latex and synthetic gloves. The Amerinet contract, which was awarded to American
Health Products in 1999, contributed sales of over $1.0 million during its
launch period which commenced in the third quarter of 1999. We look forward to
rapid growth from this contract in 2000."
"We face challenges as a result of the loss of the Novation contract. We have
built solid customer relationships with end users and distributors which will
lessen the impact of the Novation contract termination. However, it is too early
to quantify the impact. We are aggressively seeking to penetrate new segments of
the marketplace to achieve a strengthened leadership position in the glove
market," said Mr. Marteka.
In addition to the Company's fourth quarter and year-end results, WRP
Corporation also announced that its Board of Directors has authorized a program
to repurchase up to 10% of the Company's public common stock. These purchases
may be made in the open market and in block transactions over a two-year period.
The program is subject to market conditions and its impact on share price as
well as other investment options that WRPC may consider to enhance shareholder
value.
"This repurchase program reflects our confidence in the success of the Company's
aggressive growth plans and the continued growth of the disposable examination
glove market," Mr. Marteka said. "The Board of Directors recognizes that at
current prices our common stock represents an attractive investment opportunity,
and we believe this repurchase program will assist WRPC in maximizing
shareholder value."
<PAGE> 2
The Company's Board of Directors also approved a change in the Company's fiscal
year end to June 30, which corresponds to the year-end of its majority
shareholder, WRP Asia Pacific. This fiscal year-end change will be effective
June 30, 2000.
WRP Corporation, headquartered in Itasca, Illinois, is a manufacturer and
marketer of disposable examination gloves. The Company's U.S. glove distribution
arm, American Health Products Corporation, is a leading supplier of branded and
private label examination gloves to the medical, dental, food service and retail
markets nationwide. The Company is a principal supplier of powder-free latex
examination gloves through its strong alliance with Malaysia-based WRP Asia
Pacific, a top-three glove manufacturer in the world.
This press release contains forward-looking statements, which involve numerous
risks and uncertainties. The Company's actual results could differ materially
from those anticipated in such forward looking statements as a result of certain
factors, including those set forth in the Company's filings with the Securities
and Exchange Commission.
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WRP CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended For the Year Ended
December 31, December 31,
1999 1998 1999 1998
<S> <C> <C> <C> <C>
Net Sales $ 17,265,610 $ 17,811,201 $ 65,280,105 $ 64,968,401
Cost of Goods Sold 12,910,648 13,517,803 48,645,076 46,857,229
Gross Profit 4,354,962 4,293,398 16,635,029 18,111,172
Operating Expenses 3,571,373 2,213,267 12,295,192 9,954,785
Income from Operations 783,589 2,080,131 4,339,837 8,156,387
Other Expenses, Net 138,207 210,533 720,971 1,325,081
Income before Taxes 645,382 1,869,598 3,618,866 6,831,306
Income Tax Provision (Benefit) 367,970 (149,007) 1,166,121 952,146
Net Income 277,412 $ 2,018,605 2,452,745 $ 5,879,160
Diluted Earnings Per Share: $ 0.04 $ 0.29 $ 0.35 $ 0.93
Diluted Weighted Average Common
Shares Outstanding 6,928,546 6,965,836 6,964,856 6,333,510
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