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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): January 24, 1997
RALCORP HOLDINGS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Missouri 1-12766 43-1664297
(State or other (Commission (I.R.S. Employer
Jurisdiction of File Number) Identification No.)
Incorporation)
800 Market Street, Suite 2900
St. Louis, MO 63101
(Address of principal (Zip Code)
executive offices)
(314) 877-7000
(Registrant's telephone number, including area code)
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Item 5. Other Events.
In a Press Release dated January 24, 1997, a copy of which is attached hereto
as Exhibit 99.1 and the text of which is incorporated by reference herein, the
Registrant announced earnings for its first quarter ended December 31, 1996.
Item 7. Financial Statements and Exhibits.
Exhibit 99.1 Press Release dated January 24, 1997.
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.
RALCORP HOLDINGS, INC.
(Registrant)
Date: January 24, 1997 By: /s/ Joe R. Micheletto
---------------------------
Joe R. Micheletto
Chief Executive Officer
and President
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[RALCORP HOLDINGS, INC. LETTERHEAD]
PRESS RELEASE
EXHIBIT 99.1
FOR RELEASE: Immediate
CONTACT: Patrick T. Farrell
(314) 877-7095
RALCORP HOLDINGS REPORTS FIRST QUARTER 1997 EARNINGS
ST. LOUIS, MO., JANUARY 24, 1997 . . . Ralcorp Holdings, Inc., today reported
sales and net earnings for the first quarter ended December 31, 1996 of $292.9
million and $16.0 million compared to $295.3 million and $15.3 million for the
same quarter last year, excluding restructuring charges in both quarters.
Earnings per share for both this year's and last year's first quarters,
excluding charges, were $.49 and $.46, respectively.
The restructuring charge in this year's first quarter covers expenses related
to severance costs for certain employees whose jobs were eliminated in recent
downsizing initiatives. The charge of $4.6 million ($2.9 million after tax)
reduces earnings per share for the quarter to $.40. The $.9 million ($.6
million after-tax) charge in last year's first quarter was for costs related to
the elimination of 100 manufacturing jobs at a Company plant in Cedar Rapids,
IA., and reduced earnings per share for the quarter to $.44.
The accompanying Unaudited Pro Forma Combined Statement of Earnings reflects
pro forma quarterly numbers for both years which assume that the announced
sales of the Company's branded cereal and snack business and its ski resort
operations were completed as of the beginning of those periods presented. The
ski sale was completed on January 3, 1997 and the branded cereal and snack sale
is expected to close on January 31, 1997. The pro forma presentation may not
reflect future results, primarily because it removes the earnings of the
divested operations from those periods, but the corresponding cost structure
associated with supporting the larger branded cereal and snack operation has
not been removed.
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BUSINESS SEGMENT INFORMATION
Three Months Ended December 31,
<TABLE>
<CAPTION>
Sales Operating Profit
------------------------- ---------------------------
1996 1995 1996 1995
------ ------ ------ ------
<S> <C> <C> <C> <C>
Consumer Foods $263.7 $267.9 $36.2 * $33.2 **
Resort Operations 29.2 27.4 (1.3) .6
------ ------ ----- -----
Total $292.9 $295.3 $34.9 $33.8
====== ====== ===== =====
</TABLE>
* Excludes $4.6 million pre-tax restructuring charge related to employee
severance.
** Excludes $.9 million pre-tax Cedar Rapids restructuring charge.
CONSUMER FOODS
- --------------
Consumer Foods sales were down $4.2 million for the quarter, primarily on lower
branded and private label cereal sales, partially offset by a continued strong
performance from the CHEX Snack Mix product line and volume gains at the
Bremner private label cracker and cookie and Beech-Nut baby food operations.
Although private label cereal volume declined approximately 4.5 percent in the
quarter, it faced a difficult comparison due to an exceptionally strong volume
performance in last year's first quarter. A strong CHEX Party Mix promotion
resulted in comparable year over year mainline CHEX volume. The branded cereal
decline came primarily from the smaller fractional share brands.
Consumer Foods operating profit, excluding charges, improved $3.0 million in
this year's first quarter versus the same period in 1996, primarily on
performance improvements in the CHEX Snack Mix product line, partially offset
by higher advertising and promotion spending and declines in branded and
private label cereal. Baby food operating profit was even with last year with
volume increases being offset by higher cost of goods.
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RESORT OPERATIONS
- -----------------
Resort Operations, which were sold to Vail Resorts, Inc. shortly after the end
of the first quarter, recorded an operating loss of $1.3 million, compared to a
$.6 million operating profit last year, as an increase in skier visits was more
than offset by higher operating costs and lower room nights. Bitterly cold
temperatures over the important Christmas holiday and the fact that Christmas
fell mid-week, also hampered performance.
Following the sale to Vail, Ralcorp retained an approximate 25 percent
ownership level in the new ski company, which is now the largest in North
America. The management of Vail is actively working to bring the resort to the
public market, and anticipates that the company could begin trading on the New
York Stock Exchange sometime in mid to late February. Post IPO, Ralcorp's
ownership level in Vail will be approximately 22%.
BRANDED CEREAL AND SNACK SALE
- -----------------------------
A special meeting of Ralcorp shareholders will be held on January 31, 1997, to
complete the vote on the proposed merger of the branded cereal and snack
operation with General Mills, Inc., and the spin-off to shareholders of the
remaining Ralcorp operations. If the transaction is approved on that date,
shareholders of record at the close of business on January 31, will receive one
share of New Ralcorp stock for every share of Ralcorp owned and the appropriate
number of shares of General Mills stock. Also, Ralcorp will redeem its
Shareholder Rights Plan on January 31, by distributing $.05 per share of
Ralcorp stock to each shareholder of record at the close of business on January
31. The New Ralcorp stock certificates and the redemption checks will be
mailed on or about February 13, 1997.
The value shareholders receive in General Mills stock will be determined by a
10-day volume weighted average price for General Mills stock for the dates
January 16 - 29, and
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the amount of Ralcorp debt assumed by General Mills. A range in value for
General Mills stock of between $10.00 and $10.90 for every share of Ralcorp
stock owned, was given at the time the deal was announced in August 1996. The
actual amount will be announced on January 31, 1997.
See attached schedules and notes for additional information on the quarterly
results for both years.
# # #
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RALCORP HOLDINGS, INC.
CONSOLIDATED STATEMENT OF EARNINGS
(IN MILLIONS EXCEPT PER SHARE DATA)
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended
December 31,
---------------------------
1996 1995
------ ------
Net Sales $292.9 $295.3
------ ------
<S> <C> <C>
Costs and Expenses
Cost of products sold 141.2 142.3
Selling, general and administrative 38.4 43.7
Advertising and promotion 80.3 77.4
Interest expense 6.9 7.0
Restructuring charge 4.6 .9
Other (income)/expense, net -
------ ------
271.4 271.3
------ ------
Earnings before Income Taxes 21.5 24.0
Income Taxes 8.4 9.3
------ ------
Net Earnings $ 13.1 $ 14.7
====== ======
Earnings per Common Share $ .40 $ .44
====== ======
Average Shares Outstanding 32.9 33.1
</TABLE>
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RALCORP HOLDINGS, INC.
UNAUDITED PRO FORMA COMBINED STATEMENT OF EARNINGS
(in millions except per share data)
<TABLE>
<CAPTION>
Three Months Ended
December 31,
-------------------------
1996 1995
------ ------
Net Sales $121.8 $124.5
------ ------
<S> <C> <C>
Costs and Expenses
Cost of products sold 81.8 84.2
Selling, general and administrative 25.6 30.9
Advertising and promotion 12.4 14.9
Equity earnings in Vail Resorts (1.2) (.6)
Interest expense .3 .3
Restructuring charge 4.6 .9
Other (income)/expense, net -
------ ------
123.5 130.6
------ ------
Earnings before Income Taxes (1.7) (6.1)
Income Taxes (.6) (2.2)
------ ------
Net Earnings $ (1.1) $ (3.9)
====== ======
Earnings per Common Share $ (.03) $ (.12)
====== ======
Average Shares Outstanding 32.9 33.1
</TABLE>
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NOTES:
1. During the quarter ended December 31, 1996, the Company recorded a
restructuring charge to cover expenses related to the severance packages
received by certain separated employees. The amount of the charge was
$4.6 million ($2.9 million after taxes) and reduced earnings per common
share for the quarter by $.09.
2. The accompanying comparative unaudited pro forma combined statements of
earnings for the three month periods ended December 31, 1996 and 1995 are
presented to reflect the results of operations assuming the sale of the
Company's Resort Operations to Vail Resorts and the sale of the Company's
branded cereal and snack business to General Mills had been completed as
of the beginning of those periods. These pro forma statements of earnings
are for informational purposes only and may not necessarily reflect future
results of operations or what the results of operations would have been
had the sale transactions been completed during the periods shown.
3. During the quarter ended December 31, 1995, the Company recorded
nonrecurring charges to cover employee related expenses in relation to the
elimination of approximately 100 jobs at the Company's manufacturing
facility in Cedar Rapids, IA. The amount of the charges were $.9 million
($.6 million after taxes) and had the effect of reducing earnings per
common share for the quarter by $.02.
4.
The average shares outstanding used to compute earnings per common share
for the quarters ended December 31, 1996 and 1995 are based on the average
number of Ralcorp Stock shares outstanding for the periods then ended.
5.
Operating results for any quarter are not necessarily indicative of the
results for any other quarter or for the full year.
