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): February 20, 1997
COLLINS & AIKMAN CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-10218 13-3489233
(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification No.)
incorporation)
701 McCullough Drive
Charlotte, North Carolina 28262
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (704) 547-8500
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ITEM 5. OTHER EVENTS
On February 20, 1997, Collins & Aikman Corporation (the "Company") reported
operating results for the fiscal year ended December 28, 1996. The fiscal year
ended December 28, 1996 was 11 months due to the Company's change in its fiscal
year end from the last Saturday in January to the last Saturday in December.
For comparative purposes, the Company also reported selected unaudited financial
data for additional periods (including, among others, the eleven months ended
December 23, 1995 and the twelve months ended December 28, 1996).
For further information, see the Company's Press Release dated February 20,
1997, which is hereby incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) The exhibits furnished in connection with this Report are as follows:
Exhibit
Number Description
99.1 Press Release dated February 20, 1997.
1
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SIGNATURE
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.
COLLINS & AIKMAN CORPORATION
(Registrant)
Date: February 20, 1997 By:/s/ J. Michael Stepp
J. Michael Stepp
Executive Vice President
& Chief Financial Officer
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NEWS RELEASE
Contact: A. Dennis Mahedy
Treasurer
(704) 548-2072
J. Michael Stepp
Executive Vice President
& Chief Financial Officer
(704) 548-2395
COLLINS & AIKMAN REPORTS 29% REVENUE GAIN FOR 11 MONTHS
ENDED DECEMBER 28
Charlotte, North Carolina - February 20, 1997 - Collins & Aikman
Corporation (NYSE: CKC) today reported that net sales for the 11-months ended
December 28, 1996 rose 29% to $1,056 million from $816 million for the
comparable 11-month period a year before. Operating income for the 1996 period
was $102 million, a 15% increase from $89 million for the comparable 1995
period. EBITDA for the 11-months in 1996 was $135 million versus $110 million
in the comparable year-ago period, a 23% increase.
The 11-month period ended December 28, 1996 reflects, as previously
reported, the Company's change to a fiscal year ending the last Saturday in
December from the last Saturday in January previously. Both 11-month periods
reflect the Mastercraft Group as a discontinued operation. The Company
announced on December 4, 1996 that it was considering the sale of the
Mastercraft Group.
Thomas E. Hannah, Chief Executive Officer of Collins & Aikman Corporation,
said "The 11-month period ended December 28, 1996 was a watershed time for our
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Company. We completed several transactions and set others in motion which
effectively have transformed Collins & Aikman from a diversified textile
manufacturer into a highly competitive global supplier of automotive interior
systems. In the 11-months, we acquired JPS Automotive, Perstorp Components and
BTR Fatati, while agreeing to sell our Floorcoverings subsidiary and announcing
our intention to sell our Mastercraft Group and to spin off Imperial
Wallcoverings to our shareholders. In addition, we went to the market with a
highly successful placement of $400 million in subordinated notes which greatly
strengthened our capital structure, enabling us to make the major acquisitions
we did in 1996 while placing us in a financial position that allows us to
compete head-on with the other auto interior systems integrators."
Hannah continued, "For the 11-months, our Canadian and Mexican Automotive
Carpet groups operated at a record sales and income pace, and U.S. Auto Carpet
marked record income. The Convertible Systems business in Mexico brought in both
record sales and profit and the Akro floor mat group also performed extremely
well, with record sales and a strong operating profit performance."
Income from continuing operations for the 11-months totaled $33 million,
versus $55 million in the 1995 11-month period. The change reflected
approximately $21 million in higher interest expense, related to the Company's
$400 million offering of Senior Subordinated Notes in June 1996, and to
generally higher average borrowing levels related to the Company's acquisition
activities. Also the Company's effective tax rate in the 1996 11-month period
was 42.5%, versus 14.4% in 1995 due to the recognition of a $150 million
deferred tax asset in January 1996.
Net earnings were $41 million, or $.58 per share, versus $76 million or
$1.06 per share in the comparable 11-month period of 1995. The change was due
to the higher interest and taxes cited above, as well as to a $6 million
reduction in earnings from discontinued operations and a $.09 per share
extraordinary charge in June 1996 related to the Company's $400 million
subordinated debt offering.
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The Company said that the change in its fiscal year will align the
financial reporting cycle with its automotive systems supply peer companies and
with major customers. Sales for the 11-month period reflect the inclusion of
approximately two weeks results from JPS Automotive and Perstorp Components,
both of which were acquired by Collins & Aikman in December 1996.
The Company also reported that revenues for continuing operations for the
11-month period were negatively impacted by approximately $34 million related to
strikes at General Motors facilities, and stated that in December, Manchester
Plastics recorded one time charges amounting to approximately $4.0 million.
Attached to this release are the following financial data:
. Comparable Consolidated Statements of Operations for the 11-month
periods ended December 1996 and 1995.
. Consolidated Balance Sheets as of December 28, 1996 and January 27,
1996.
. Restated Quarterly Consolidated Statements of Operations for the
calendar years ended December 1996 and 1995.
Collins & Aikman is a major supplier of automotive interior systems -
textile and plastic trim, acoustics and convertible tops - to the global
automotive industry.
###
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COLLINS & AIKMAN CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except for per share data)
Eleven Months Ended
December 28, December 23,
1996 1995
Net sales...................... $1,055,931 $ 815,811
Cost of goods sold............. 867,257 667,899
Selling, general and administrative
expenses ..................... 86,625 59,145
953,882 727,044
Operating income............... 102,049 88,767
Interest expense, net.......... 39,850 18,598
Loss on sale of receivables.... 4,533 5,742
Other expense.................. 113 -
Income from continuing operations
before income taxes .......... 57,553 64,427
Income taxes................... 24,442 9,247
Income from continuing operations 33,111 55,180
Income from discontinued operations,
net of income taxes .......... 14,323 20,440
Income before extraordinary loss 47,434 75,620
Extraordinary loss, net of income
taxes ........................ (6,610) -
Net income..................... $ 40,824 $ 75,620
Net income per primary and fully
diluted common share:
Continuing operations ........ $ .47 $ .77
Discontinued operations ...... .20 .29
Extraordinary item ........... (.09) -
Net income ................... $ .58 $ 1.06
Average common shares outstanding:
Primary ...................... 69,908 71,299
Fully diluted ................ 69,938 71,342
EBITDA......................... $ 134,581 $ 110,236
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COLLINS & AIKMAN CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands)
December 28, January 27,
1996 1996
ASSETS
Current Assets:
Cash and cash equivalents ........ $ 14,316 $ 977
Accounts and notes receivable, net 210,263 127,376
Inventories ...................... 129,860 96,928
Net assets of discontinued operations 212,039 161,025
Other ............................ 129,065 70,666
Total current assets ............ 695,543 456,972
Property, plant and equipment, net. 375,974 193,438
Deferred tax assets................ 92,011 132,294
Goodwill, net...................... 298,239 159,347
Other assets....................... 74,713 49,310
$ 1,536,480 $ 991,361
LIABILITIES AND COMMON STOCKHOLDERS' DEFICIT
Current Liabilities:
Notes payable .................... $ 1,920 $ 2,101
Current maturities of long-term debt 38,190 49,228
Accounts payable ................. 126,927 93,603
Accrued expenses ................. 177,462 87,001
Total current liabilities ....... 344,499 231,933
Long-term debt..................... 1,138,029 710,738
Other, including postretirement benefit
obligation....................... 248,530 276,542
Commitments and contingencies......
Common stock (150,000 shares authorized,
70,521 shares issued and 67,723 shares
outstanding at December 28, 1996 and 70,521
shares issued and 69,074 outstanding at
January 27, 1996) ................ 705 705
Other paid-in capital.............. 585,207 585,469
Accumulated deficit................ (729,315) (770,139)
Foreign currency translation adjustments (20,798) (23,719)
Pension equity adjustment.......... (10,165) (9,090)
Treasury stock, at cost (2,798 shares at
December 28, 1996 and 1,447 shares at
January 27, 1996) ................ (20,212) (11,078)
Total common stockholders' deficit (194,578) (227,852)
$ 1,536,480 $ 991,361
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COLLINS & AIKMAN CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except for per share data)
<TABLE>
<CAPTION>
Quarter Ended Year Ended
March 23, June 22, September 21, December 28, December 28,
1996 1996 1996 1996 1996
<S> <C> <C> <C> <C> <C>
Net sales........................ $ 257,677 $302,831 $ 266,903 $ 314,726 $1,142,137
Cost of goods sold............... 211,090 242,455 220,495 262,976 937,016
Selling, general and 23,965 22,607 21,680 27,928 96,180
administrative expenses ........ 235,055 265,062 242,175 290,904 1,033,196
Operating income................. 22,622 37,769 24,728 23,822 108,941
Interest expense, net............ 8,059 8,827 11,631 14,885 43,402
Loss on sale of receivables...... 1,366 1,218 1,084 1,369 5,037
Other expense (income)........... (1,059) 672 (15) 515 113
Income from continuing operations
before income taxes ............ 14,256 27,052 12,028 7,053 60,389
Income taxes..................... (144,150) 11,298 5,141 2,947 (124,764)
Income from continuing operations 158,406 15,754 6,887 4,106 185,153
Income (loss) from discontinued
operations, net of income taxes (22,042) 4,980 4,791 5,374 (6,897)
Income before extraordinary loss 136,364 20,734 11,678 9,480 178,256
Extraordinary loss, net of income
taxes .......................... - (6,610) - - (6,610)
Net income....................... $ 136,364 $ 14,124 $ 11,678 $ 9,480 $ 171,646
Net income per primary and fully
diluted common share:
Continuing operations .......... $ 2.26 $ .22 $ .10 $ .06 $ 2.64
Discontinued operations ........ (.31) .07 .07 .08 (.10)
Extraordinary item ............. - (.09) - - (.09)
Net income ..................... $ 1.95 $ .20 $ .17 $ .14 $2.45
Average common shares outstanding:
Primary ........................ 70,093 70,031 69,925 69,692 69,935
Fully diluted .................. 70,093 70,031 69,937 69,692 69,938
EBITDA:
Continuing operations .......... $ 30,144 $46,214 $ 33,166 $ 33,944 $ 143,468
Mastercraft Group .............. $ 8,064 $11,010 $ 11,161 $ 13,623 $ 43,857
Floorcoverings ................. $ 3,614 $ 7,313 $ 7,883 $ 6,869 $ 25,679
</TABLE>
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COLLINS & AIKMAN CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except for per share data)
<TABLE>
<CAPTION>
Quarter Ended Year Ended
March 25, June 24, September 23, December 23, December 23,
1995 1995 1995 1995 1995
<S> <C> <C> <C> <C> <C>
Net sales........................ $ 236,144 $231,547 $ 199,325 $ 231,958 $ 898,974
Cost of goods sold............... 191,348 190,353 164,668 188,211 734,580
Selling, general and 15,218 16,183 16,457 17,106 64,964
administrative expenses ........
206,566 206,536 181,125 205,317 799,544
Operating income................. 29,578 25,011 18,200 26,641 99,430
Interest expense, net............ 4,229 5,123 5,628 5,464 20,444
Loss on sale of receivables...... 1,954 1,650 1,454 1,331 6,389
Income from continuing operations
before income taxes.............. 23,395 18,238 11,118 19,846 72,597
Income taxes..................... 2,653 2,404 2,590 2,466 10,113
Income from continuing operations 20,742 15,834 8,528 17,380 62,484
Income from discontinued
operations, net of income taxes . 5,995 8,046 5,068 5,256 24,365
Net income....................... $ 26,737 $ 23,880 $ 13,596 $ 22,636 $ 86,849
Net income per primary and fully
diluted common share:
Continuing operations .......... $ .29 $ .22 $ .12 $ .25 $ .88
Discontinued operations ........ .08 .11 .07 .07 .34
Net income ..................... $ .37 $ .33 $ .19 $ .32 $ 1.22
Average common shares outstanding:
Primary ........................ 71,802 71,613 71,335 70,697 71,362
Fully diluted .................. 71,802 71,613 71,348 70,697 71,365
EBITDA:
Continuing operations .......... $ 35,366 $ 31,171 $ 24,116 $ 32,172 $ 122,825
Mastercraft Group .............. $ 13,222 $ 10,084 $ 8,370 $ 11,853 $ 43,529
Floorcoverings ................. $ 3,884 $ 6,835 $ 8,475 $ 5,975 $ 25,169
</TABLE>
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