SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
____
|_X__| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1994
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 33-28812
HYSTER - YALE MATERIALS HANDLING, INC.
(Exact name of registrant as specified in its charter).
Delaware 34-1617886
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(State or other jurisdiction of (IRS Employeridentification No.)
incorporation or organization)
2701 NW Vaughn, Portland, Oregon 97210
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (503) 721-6000
NONE
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Former name, former address and former fiscal year, if changed since last
report
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, and (2) has been subject to
such filing requirements for the last 90 days.
Yes X No
--- ---
Number of shares of Common Stock outstanding at April 30,1994: 5,598.857
<PAGE>
HYSTER-YALE MATERIALS HANDLING, INC.
TABLE OF CONTENTS
PAGE NO.
Part I. FINANCIAL INFORMATION
Item 1 - Financial Statements
Unaudited Consolidated Balance Sheets - March 31, 1994
and December 31, 1993................................. 3
Unaudited Consolidated Statements of Income - for the Three
Months ended March 31, 1994 and 1993..................... 4
Unaudited Consolidated Statements of Cash Flows - for the
Three Months ended March 31, 1994 and 1993..................... 5
Notes to Unaudited Consolidated Financial Statements..... 6
Item 2 - Management's Discussion and Analysis of Results of
Operations and Financial Condition........................ 7 - 9
Part II. OTHER INFORMATION............................... 10 - 11
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<PAGE>
PART I
ITEM 1 - Financial Statements
<TABLE>
HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE SHEETS
<CAPTION>
MARCH 31 DECEMBER 31
1994 1993
---- ----
ASSETS (In thousands)
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 10,609 $ 20,255
Accounts receivable, net 107,062 104,959
Inventories 173,473 151,216
Assets held for sale 11,969 11,991
Deferred income taxes 6,769 6,639
Prepaid expenses and other 7,448 7,547
------- -------
317,330 302,607
Other Assets, net 9,230 9,969
Property, Plant and Equipment, net 122,815 121,732
Deferred Charges:
Goodwill, net 381,208 383,927
Other, net 14,142 14,800
------- -------
395,350 398,727
------- -------
$844,725 $833,035
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $111,413 $ 97,753
Short-term obligations 9,609 7,853
Current maturities of-
long-term obligations 32,758 28,388
Accrued expenses 62,172 66,664
Deferred income taxes 1,770 2,383
Accrued income taxes 18,443 22,266
------- -------
236,165 225,307
Other Liabilities 45,846 46,079
Deferred Income Taxes 13,890 14,180
Long-Term Obligations 289,864 290,343
Stockholders' Equity:
Common Stock 6 6
Capital in excess of par value 178,192 178,192
Retained income 83,738 82,875
Foreign currency translation-
adjustment and other (2,976) (3,947)
------- -------
258,960 257,126
------- -------
$844,725 $833,035
======== ========
<FN>
See notes to unaudited consolidated financial statements.
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</TABLE>
<PAGE>
<TABLE>
HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
<CAPTION>
THREE MONTHS ENDED
MARCH 31
------------------
(In thousands)
1994 1993
---- ----
<S> <C> <C>
Net sales $245,328 $214,680
Cost of sales 194,798 169,707
------- -------
Gross profit 50,530 44,973
Selling, administrative and
general expenses 36,744 32,711
Goodwill amortization 2,711 2,711
------ -----
Operating profit 11,075 9,551
Other income (expense):
Interest income 146 123
Interest expense (8,726) (10,453)
Other, net (640) (637)
------- --------
(9,220) (10,967)
------- --------
Income (loss) before income
taxes 1,855 (1,416)
Income tax provision (benefit) 993 (645)
----- -------
Net income (loss) $ 862 $ (771)
===== =======
<FN>
See notes to unaudited consolidated financial statements.
</TABLE>
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<PAGE>
<TABLE>
HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
THREE MONTHS ENDED
MARCH 31
------------------
1994 1993
---- -----
(In thousands)
<S> <C> <C>
Operating Activities:
Net income (loss) $ 862 $( 771)
Adjustment to reconcile net loss to net
cash provided (used) by operating-
activities
Depreciation and amortization 8,058 7,971
Deferred income taxes (1,018) (749)
Reserves for self-insurance (146) 1,726
Other, net 639 466
Working Capital Changes:
Accounts receivable (1,393) (6,379)
Inventories (21,182) (1,784)
Other current assets 158 (1,272)
Current liabilities 4,375 ( 16,639)
-------- ---------
Net cash provided (used) by operating-
activities (9,647) (17,431)
------- --------
Investing Activities:
Expenditures for property, plant and-
equipment (6,308) (4,460)
Other 250 552
--- ---
Net cash provided (used) by-
investing activities (6,058) (3,908)
------- -------
Financing Activities:
Additions to long-term obligations - 29
Reduction of long-term obligations (6,810) (505)
Revolving credit facilities, net 10,700 27,600
Short-term obligations, net 1,518 (4,700)
Other 496 766
--- ---
Net cash provided (used) by
financing activities 5,904 23,190
----- ------
Effect of exchange rate changes on cash 155 (53)
--- ----
Cash and Cash Equivalents:
Increase (decrease) for the period (9,646) 1,798
Balance at the beginning of the period 20,255 7,865
------ -----
Balance at the end of the period $10,609 $ 9,663
======= =======
<FN>
See notes to unaudited consolidated financial statements.
</TABLE>
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<PAGE>
HYSTER-YALE MATERIALS HANDLING, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1994
Note A - Basis of Presentation
The accompanying unaudited consolidated financial statements
of Hyster-Yale Materials Handling, Inc. and subsidiaries (the
Company) include the accounts of Hyster-Yale Materials Handling,
Inc. (Hyster-Yale), a 97% owned subsidiary of NACCO
Industries, Inc. (NACCO), and its wholly-owned subsidiaries
NACCO Materials Handling Group, Inc. and NACCO Materials Handling
Holding Co. The Company primarily does business as NACCO
Materials Handling Group, Inc. with two product brands, Hyster
and Yale.
These financial statements have been prepared in accordance with
generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Article 10
of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted
accounting principles for complete financial statements. In the
opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation
of the financial position of the Company as of March 31, 1994,
and the results of its operations and cash flows for the three
month periods ended March 31, 1994 and 1993 have been included.
Operating results for the three month period ended March 31, 1994
are not necessarily indicative of the results that may be
expected for the year ended December 31, 1994. For further
information, refer to the consolidated financial statements and
footnotes thereto included in the Company's annual report on Form
10-K for the year ended December 31, 1993.
Operating profit in prior periods' consolidated financial
statements has been restated to reflect the reclassification of
goodwill amortization as a component of operating expenses.
Certain other amounts in the prior periods' unaudited
consolidated financial statements have been reclassified to
conform to the current periods' presentation.
Note B - Inventories
Inventories are summarized as follows:
MARCH 31 DECEMBER 31
1994 1993
---- ----
(In thousands)
Finished goods and service-
parts $ 82,395 $ 81,549
Raw materials and work-
in progress 102,569 80,304
LIFO Reserve (11,491) (10,637)
--------- --------
Total $173,473 $151,216
========= ========
The cost of inventories has been determined by the last-in first-
out (LIFO) method for 60% and 61% of such inventories as of March
31, 1994 and December 31, 1993, respectively.
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<PAGE>
ITEM 2 - Management's Discussion and Analysis of Results of
Operations and Financial Condition
FINANCIAL REVIEW
Sales and Operating Profits
First quarter 1994 net sales were $245.3 million, up 14.3% over
the first quarter of 1993. Operating profit was $11.1 million,
up 15.6% from $9.6 million reported in 1993. The following
schedule details the components of the changes in net sales and
operating profit and net income (loss) for the three month period
of 1994 compared with 1993:
<TABLE>
<CAPTION>
Net
Net Operating Income
Sales Profit (Loss)
(In millions)
<S> <C> <C> <C>
1993 $214.7 $9.6 $(0.8)
Increase (Decrease) in 1994 from:
Lift truck unit volume 24.6 4.5 3.0
Sales mix 2.0 1.1 0.7
Average sales price 1.5 1.5 1.0
Service parts 4.0 1.4 0.9
Manufacturing cost 1.1 0.7
Other operating expense (4.1) (2.7)
Foreign currency (1.5) (4.0) (3.0)
Other income and expense 0.9
Differences between effective-
and statutory tax rates 0.5
Change in statutory tax rates (0.3)
------ ------ -----
1994 $245.3 $11.1 $0.9
====== ===== ====
</TABLE>
Increased unit volume in 1994 reflects the continued economic
improvement in North America and improvements in global market
share. European volume continues to be impacted by the European
recession. While price discounting continues to be prevalent in
the forklift industry, pricing has improved slightly in 1994 over
1993. Sales mix changes to higher margin products have
positively affected results of operations in 1994. Service parts
volume and income continues to improve in North America and
Europe due to the improving economy in North America and new
dealers in Europe.
Manufacturing costs decreased in first quarter 1994 compared to
1993 due to higher production volumes which resulted in increased
overhead absorption. New product introductions also increased
1993 manufacturing costs. Other operating expenses were higher
in 1994 due primarily to new marketing programs. First Quarter
1994 operating profits were also adversely affected by the
stronger Japanese Yen which increased the cost of purchases
sourced from Japan.
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<PAGE>
FINANCIAL REVIEW (Continued)
The Company's backlog of orders at March 31, 1994 was
approximately 18,500 units compared to the 12,000 units at
December 31, 1993. Backlog has increased due to a significant
increase in orders from dealers both in North America and Europe.
The market in Europe, however, is still at historically low
levels. The strong first quarter 1994 order rate has resulted in
longer lead times for selected models.
Geographic Segment Data
The following table presents the results of the Company on a
geographic basis for the periods ended March 31, 1994 and 1993
respectively.
<TABLE>
<CAPTION>
For the Three Months Ended March 31
Americas Europe Other Int'l Corp/Elims Total
-------- ------ ----------- ---------- -----
(In Millions)
<S> <C> <C> <C> <C> <C>
Net Sales
1994 $174.1 $ 58.2 $ 13.0 $ 0.0 $245.3
1993 $155.5 $ 49.1 $ 10.1 $ 0.0 $214.7
Operating Profit (loss)
1994 $ 9.7 $ 0.7 $ 1.1 $ (0.4) $ 11.1
1993 $ 9.7 $ (1.4) $ 0.5 $ 0.8 $ 9.6
</TABLE>
Other
- - -----
Interest expense during the three month period of 1994 was $8.7
million compared to $10.4 million in the same period a year ago.
Lower 1994 interest expense is primarily due to lower debt levels
resulting from the July 1993 retirement of $50 million 12 3/8%
subordinated debentures.
The Company has entered into unsecured interest rate swap
agreements for a portion of its floating rate debt to provide
protection against significant increases in interest rates. At
March 31, 1994, the Company had outstanding interest rate swap
agreements with total notional principal amounts of $125 million.
The Company will continue to evaluate its exposure to floating
rate debt.
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<PAGE>
FINANCIAL REVIEW (Continued)
Items included in other-net expense are as follows:
<TABLE>
<CAPTION>
Three Months Ended
March 31
(In Thousands)
1994 1993
---- ----
<S> <C> <C>
Currency transaction gains (losses) $ (0.3) $ 0.3
Equity in losses of
unconsolidated subsidiaries (0.5) (0.5)
Miscellaneous 0.2 (0.4)
----- -----
$ (0.6) $ (0.6)
===== =====
</TABLE>
The equity losses in unconsolidated subsidiaries primarily result
from recording 50% of the operating losses of the Company's
Sumitomo-Yale (S-Y) joint venture. The losses in 1994 and 1993
are due to the strong yen and depressed Japanese domestic market.
Provision for Income Taxes
The Company recorded a tax provision of $1.0 million on pretax
income of $1.9 million in 1994 for an effective tax rate of
53.5%. The higher than statutory rate results primarily from the
nondeductibility of goodwill amortization. This compares to a
benefit of $0.6 million on a pretax loss of $1.4 million in the
first quarter of 1993 for an effective tax rate of 45.5%. The
lower tax rate in 1993 primarily reflects tax benefits on the
sale of property in 1993 not expected in 1994.
LIQUIDITY AND CAPITAL RESOURCES
The Company believes it can adequately meet all of its current
and long-term commitments and operating needs through internally
generated funds and borrowings available under revolving credit
agreements. As of March 31, 1994 there was $89.3 million
available under the senior bank revolving credit facility.
Expenditures for property, plant and equipment were $6.3 million
for the first three months of 1994. The majority of these
expenditures were for manufacturing expansion and tooling related
to future production of new products. Estimated capital
expenditures for the remainder of 1994 will be approximately
$18.7 million. Principal sources of financing these capital
expenditures are internally generated funds, bank borrowings and
assistance grants from local development boards.
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<PAGE>
PART II
Item 1 - Legal Proceedings
None
Item 2 - Change in Securities
None
Item 3 - Defaults Upon Senior Securities
None
Item 4 - Submission of Matters to a Vote of Security Holders
None
Item 5 - Other Information
None
Item 6 - Exhibits and Reports on Form 8-K
None
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<PAGE>
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.
Hyster-Yale Materials
Handling, Inc.
(Registrant)
Roger A. Jensen
Roger A. Jensen
Controller
(Chief Accounting Officer)
Date: May , 1994
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