FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT
OF 1934.
For the Quarterly Period Ended September 30, 1994
------------------
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
Commission file number 1-4743
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Standard Motor Products, Inc.
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(Exact name of registrant as specified in its charter)
New York 11-1362020
- --------------------------------- -----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
37-18 Northern Blvd., Long Island City, N.Y. 11101
- ---------------------------------------------- -----------------------
(Address of principal executive offices) (Zip Code)
(718) 392-0200
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(Registrant's telephone number, including area code)
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 (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:
Date Class Shares Outstanding
- -------------------- ----------------- ---------------------------
September 30, 1994 Common Stock 13,120,826
- -------------------- ----------------- ---------------------------
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
INDEX TO FINANCIAL AND OTHER INFORMATION
SEPTEMBER 30, 1994
PART 1 - FINANCIAL INFORMATION
------------------------------
Item 1 Page No.
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CONSOLIDATED BALANCE SHEETS
September 30, 1994 and December 31, 1993 2 & 3
CONSOLIDATED STATEMENTS OF EARNINGS AND
RETAINED EARNINGS for the Three-Month and 4
Nine-Month periods ended September 30, 1994 and 1993
CONSOLIDATED STATEMENTS OF CASH FLOWS for the Nine-Month
periods ended September 30, 1994 and 1993 5 & 6
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 7 - 10
Item 2
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL 11 & 12
CONDITION AND RESULTS OF OPERATIONS
PART II - OTHER INFORMATION
---------------------------
Item 6
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Exhibits and Reports on Form 8K 13
Signature 13
- 1 -
[CAPTION]
<TABLE>
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
ASSETS
------
<CAPTION>
September 30, December 31,
1994 1993
------------- ------------
(Unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 3,301 $ 12,346
Marketable securities (Note 2) 6,435 11
Accounts and notes receivable, net of
allowance for doubtful accounts and
discounts of $7,408 (1993 - $5,536) 131,829 97,754
Inventories (Note 3) 168,775 164,150
Prepaid taxes based on earnings - 974
Deferred income taxes 17,460 17,460
Prepaid expenses and other current assets 5,783 11,100
----------- ----------
Total current assets 333,583 303,795
Property, plant and equipment, net of
accumulated depreciation (Note 4) 102,602 103,004
Other assets:
Receivables due after one year 499 2,645
Sundry (Note 9) 15,128 13,893
------------ ------------
Total assets $ 451,812 $ 423,337
------------ ------------
------------ ------------
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
-2-
[CAPTION]
<TABLE>
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
<CAPTION>
September 30, December 31,
1994 1993
------------- ------------
(Unaudited)
<S> <C> <C>
Current liabilities:
Notes payable - banks $ 23,000 $ 5,100
Current portion of long-term debt (Note 7) 4,972 4,935
Accounts payable 33,689 41,373
Sundry payables and accrued expenses 44,848 32,033
Taxes based on earnings 1,490 4,617
Taxes (other than those based on earnings) 1,167 1,332
Payroll and commissions 9,525 10,173
------------ ------------
Total current liabilities 118,691 99,563
Long-term debt (Note 7) 125,356 130,514
Deferred income taxes 3,625 3,625
Postretirement benefits other than pensions 12,464 11,452
------------ ------------
Total liabilities 260,136 245,154
Commitments and contingencies (Note 7)
Stockholders' equity (Notes 6, 7 and 8):
Common stock-par value $2.00 per share
Authorized - 30,000,000 shares
Issued - 13,324,476 shares in 1994
and 13,309,976 shares in 1993
(including 203,650 and 5,000 shares held as 26,649 26,620
treasury shares in 1994 and 1993, respectively)
Capital in excess of par value 2,183 2,120
Loan to E.S.O.P. (6,705) (8,385)
Minimum pension liability adjustment (581) (581)
Retained earnings 173,979 158,456
Foreign currency translation adjustment 122 69
------------ ------------
195,647 178,299
Less: treasury stock-at cost 3,971 116
------------ ------------
Total stockholders' equity 191,676 178,183
------------ ------------
Total liabilities and stockholders' equity $ 451,812 $ 423,337
------------ ------------
------------ ------------
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
-3-
[CAPTION]
<TABLE>
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS AND RETAINED EARNINGS
(Dollars in thousands, except for shares and per share data)
(Unaudited)
<CAPTION>
For the Three Months Ended For the Nine Months Ended
September 30, September 30,
---------------------------- ----------------------------
1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net sales $ 168,291 $ 161,340 $ 503,062 $ 450,296
Cost of sales 109,466 104,554 330,022 291,066
------------ ------------ ------------ ------------
Gross profit on sales 58,825 56,786 173,040 159,230
Selling, general and
administrative expenses 44,396 45,116 137,152 128,007
Provision for restructuring charges
(Note 10) - 440 - 1,000
------------ ------------ ------------ ------------
14,429 11,230 35,888 30,223
Other income (expense) - net 444 261 721 894
------------ ------------ ------------ ------------
14,873 11,491 36,609 31,117
Interest expense 3,165 3,047 9,265 9,271
------------ ------------ ------------ ------------
Earnings before taxes and cumulative
effect of changes in accounting
principles 11,708 8,444 27,344 21,846
Taxes based on earnings (Note 5) 3,978 2,741 8,653 6,511
------------ ------------ ------------ ------------
Earnings before cumulative effect
of changes in accounting principles 7,730 5,703 18,691 15,335
Cumulative effect of changes in
accounting for postretirement
benefits and income taxes, net - - - (1,090)
------------ ------------ ------------ ------------
Net earnings $ 7,730 $ 5,703 $ 18,691 $ 14,245
Retained earnings
at beginning of period 167,299 151,602 158,456 145,159
------------ ------------ ------------ ------------
175,029 157,305 177,147 159,404
Less: cash dividends for period 1,050 1,053 3,168 3,152
------------ ------------ ------------ ------------
Retained earnings at end of period $ 173,979 $ 156,252 $ 173,979 $ 156,252
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
Per share data:
- ---------------
Earnings before cumulative effect
of changes in accounting principles $.59 $.43 $1.42 $1.16
Cumulative effect of changes in
accounting principles - - - (.09)
---- ---- ----- -----
Net earnings per share $.59 $.43 $1.42 $1.07
---- ---- ----- -----
---- ---- ----- -----
Dividends per common share $.08 $.08 $.24 $.24
---- ---- ---- ----
Average number of common and
common equivalent shares
(Note 8) 13,121,932 13,295,617 13,184,576 13,255,590
---------- ---------- ---------- ----------
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
-4-
[CAPTION]
<TABLE>
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
<CAPTION>
For the Nine Months Ended
September 30,
-------------------------
1994 1993
-------- ---------
<S> <C> <C>
Cash flows from operating activities:
Net earnings $ 18,691 $ 14,245
Adjustments to reconcile net earnings to net
cash provided by (used in) operating activities:
Cumulative effect of changes in accounting
for postretirement benefits and income taxes, net - 1,090
Depreciation and amortization 8,430 7,993
Loss on sale of property,plant & equipment 118 98
(Gain) loss on sale of marketable securities 50 (252)
Change in assets and liabilities:
(Increase) in accounts receivable, net (34,097) (39,784)
(Increase) decrease in inventories (4,693) 8,642
Decrease in prepaid taxes based on earnings 974 1,233
(Increase) decrease in other assets 824 (7,731)
Increase (decrease) in accounts payable (7,681) 13,562
(Decrease) in taxes based on earnings (3,127) (1,024)
Increase (decrease) in other current assets and liabilities 4,704 (4,423)
Increase in sundry payables and accrued expenses 13,857 14,498
----------- ----------
Total adjustments (20,641) (6,098)
----------- ----------
Net cash provided by (used in) operating activities (1,950) 8,147
Cash flows from investing activities:
Proceeds from sales of marketable securities 4,453 10,221
Purchases of marketable securities (10,927) (15,978)
Sale of fixed assets 6 61
Capital expenditures (8,152) (7,427)
----------- ----------
Net cash used in investing activities (14,620) (13,123)
Cash flows from financing activities:
Net borrowings under line-of-credit agreements 17,900 6,200
Principal payments of long-term debt (5,121) (14,660)
Reduction of loan to E.S.O.P. 1,680 1,680
Proceeds from exercise of employee stock options 538 1,726
Purchase of treasury stock (4,301) -
Dividends paid (3,168) (3,152)
----------- ----------
Net cash provided by (used in) financing activities $ 7,528 $ (8,206)
----------- ----------
</TABLE>
-5-
[CAPTION]
<TABLE>
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
<CAPTION>
For the Nine Months Ended
September 30,
------------------------------
1994 1993
------------- ------------
<S> <C> <C>
Effect of exchange rate changes on cash $ (3) $ (1)
------------- ------------
Net decrease in cash (9,045) (13,183)
Cash and cash equivalents at beginning of the period 12,346 17,025
------------- ------------
Cash and cash equivalents at end of the period $ 3,301 $ 3,842
------------- ------------
------------- ------------
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest $ 7,212 $ 7,077
Income taxes 10,806 6,301
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
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STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1
The accompanying financial information should be read in conjunction with the
consolidated financial statements, including the notes thereto, for the year
ended December 31, 1993.
Management acknowledges its responsibility for the preparation of the
accompanying interim consolidated financial statements which reflect all
adjustments considered necessary, in the opinion of management, for a fair
statement of the results of interim periods presented. The results of
operations for the interim periods are not necessarily indicative of the results
of operations for the entire year.
Effective January 1, 1994 the Company adopted Statement of Financial
Accounting Standards (SFAS) No. 112, "Employers' Accounting for
Postemployment Benefits". This standard requires that the cost of benefits
provided to former or inactive employees be recognized on the accrual basis
of accounting. The standard had an immaterial impact on the Company's
financial position and results of operations for the nine months ended
September 30, 1994.
Note 2
Effective January 1, 1994, the Company adopted Statement of Financial
Accounting Standards (SFAS) No. 115, "Accounting for Certain Investments in
Debt and Equity Securities". Trading Marketable Securities are stated at
market value and Held-to-Maturity Marketable Securities are stated at
amortized cost. The basis on which cost is determined in calculating realized
gains or losses is the first-in, first-out method. The standard had an
immaterial impact on the Company's financial position and results of
operations for the nine months ended September 30, 1994.
Note 3
Inventories
-----------
(Dollars in thousands)
September 30, December 31,
1994 1993
------------- ------------
(Unaudited)
Finished goods $ 103,882 $ 103,886
Work in process 17,608 18,249
Raw materials 47,285 42,015
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Total inventories $ 168,775 $ 164,150
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------------ -------------
Note 4
Property, Plant and Equipment
-----------------------------
(Dollars in thousands)
September 30, December 31,
1994 1993
------------- ------------
(Unaudited)
Land and buildings $ 67,483 $ 67,470
Machinery and equipment 59,180 55,341
Tools, dies and auxiliary equipment 6,663 6,526
Furniture and fixtures 14,539 13,756
Leasehold improvements 4,636 4,622
Construction in progress 11,200 8,147
------------ ------------
163,701 155,862
Less accumulated depreciation
and amortization 61,099 52,858
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Total property, plant and equipment-net $ 102,602 $ 103,004
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STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 5
The provision for taxes is less than the normal statutory rate primarily because
earnings of a subsidiary operating in Puerto Rico, amounting to approximately
$5,555,000 in 1994 and approximately $4,704,000 in 1993, are exempt from
United States income taxes and are partially exempt from Puerto Rican income
taxes. Income earned (losses) incurred by foreign subsidiaries not eliminated
in consolidation amounted to approximately $509,000 and ($169,000) for the
nine months ended September 30, 1994 and 1993.
Note 6
On May 26, 1994, the Board approved, to reserve for issuance, 400,000
shares of the Company's common stock for the Company's 1994 Omnibus
Stock Option Plan. The Company granted 250,000 options whose exercise
price was at the stock's fair market value at the time of issuance.
At September 30, 1994 there were 446,350 shares of common stock reserved
for the exercise of stock options.
Note 7
Long Term Debt
--------------
(Dollars in thousands)
September 30, December 31,
1994 1993
------------- ------------
(Unaudited)
Long term debt consists of:
7.85% senior notes payable $ 65,000 $ 65,000
10.75% - 11.50% senior notes payable 4,000 6,000
9.47% senior notes payable 30,000 30,000
6.01% senior notes payable 15,000 15,000
Credit Agreement 6,714 8,394
7.35% - 12.875% purchase obligations 8,602 9,862
Floating rate purchase obligation 950 1,100
9.50% mortgage payable 62 93
------------ -------------
130,328 135,449
Less current portion 4,972 4,935
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$ 125,356 $ 130,514
------------ -------------
------------ -------------
Under the terms of the $65,000,000 senior note agreement, the Company is
required to repay the loan in seven equal annual installments beginning in 1996.
Under the terms of the $4,000,000 senior note agreement, the Company is
required to repay the remaining loan in equal annual installments in 1995
and 1996.
Under the terms of the $30,000,000 senior note agreement, the Company is
required to repay the loan in seven varying annual installments beginning in
1998. Subject to certain restrictions, the Company may make prepayments
without premium beginning in 1998.
Under the terms of the $15,000,000 senior note agreement, the Company is
required to repay the loan in full in 1995. The Company also entered into an
interest rate swap agreement. The swap agreement modifies the interest rate
on the $15,000,000 senior note agreement, adjusted favorably or unfavorably
for the spread between 5.66% and the 6-month reserve unadjusted London
Interbank Offering Rate ("LIBOR").
- 8 -
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 7 (Continued)
The Credit Agreement matures in equal annual installments through 1998 and
bears interest at the lower of 91% of prime rate, or 91% of the "LIBOR" plus
1.092%. The Company also entered into an interest rate swap agreement to
reduce the impact of changes in interest rates on its Credit Agreement. The
swap agreement modifies the interest rate on $6,750,000 of the Credit
Agreement, adjusted favorably or unfavorably for the spread between 77.52% of
the 3-month reserve unadjusted "LIBOR" and 7.69%. The proceeds of such
note were loaned to the Company's Employee Stock Ownership Plan (ESOP) to
purchase 1,000,000 shares of the Company's common stock to be distributed in
accordance with the terms of the ESOP established in 1989.
The purchase obligations, due under agreements with municipalities, mature in
annual installments through 2003, and are secured by certain property, plant,
and equipment. An optional prepayment of $600,000 was made on July 1, 1994.
The floating rate purchase obligation matures in annual installments through
1999, bears interest at sixty-five percent of prime, and is secured by certain
property, plant and equipment.
The mortgage payable is due in installments through 1995.
The loan agreements require the maintenance of a specified amount of working
capital and limit, among other items, investments, leases, indebtedness and
distributions for the payment of dividends and the acquisition of capital stock.
Effective September 30, 1994, the Company had unrestricted retained earnings of
$10,756,000.
Note 8
The average number of common and common equivalent shares used in the
computation of per share data is summarized as follows:
[CAPTION]
<TABLE>
(Unaudited)
For the Three Months Ended For the Nine Months Ended
September 30, September 30,
---------------------------- ---------------------------
<CAPTION>
1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Weighted average
number of shares 13,119,427 13,175,015 13,180,644 13,140,252
Shares issuable
upon assumed exercise
of stock options
(Treasury Stock Method) 2,505 120,602 3,932 115,338
------------ ------------ ------------ -----------
Number of shares to
be used 13,121,932 13,295,617 13,184,576 13,255,590
------------ ------------ ------------ -----------
------------ ------------ ------------ -----------
</TABLE>
The calculations on a fully diluted basis are not presented since the
alternative computation resulted in an insignificant change in the number
of shares and it did not result in any change in earnings per share.
- 9 -
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 9
Other assets - sundry consists of unamortized customer supply agreements,
long-term investments, pension assets, equity in joint ventures and deferred
charges.
Note 10
During 1993, the Company recorded a $2,781,000 provision for restructuring
charges. Included in the restructuring plan are charges for the expected costs
of facility consolidations, asset retirements, employee separations, relocations
and related costs.
- 10 -
STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
----------------------------------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
-------------------------------------------------
CONDITION AND RESULTS OF OPERATIONS
-----------------------------------
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
As of September 30, 1994, the Company was in a liquid position with
stockholders' equity of $191,676,000 and working capital of $214,892,000. The
Company expects capital expenditures to be approximately $4,000,000 for new
machinery and equipment for the remainder of 1994. At September 30, 1994,
the Company had unused lines of credit aggregating approximately $82,000,000
which will be used as a source of funding working capital requirements and
capital expenditures. The Company anticipates that its present sources of funds
will continue to be adequate to meet its needs.
As part of an ongoing operating strategy, the Company is reviewing potential
acquisition candidates in related automotive component businesses. If such
an acquisition is made, additional sources of capital could be required. It
presently is anticipated that any such acquisition could be funded in the
short term by presently available lines of credit with new long term financing
to follow.
Restructuring plans started in 1993 were substantially completed at the end
of the third quarter of 1994.
INTERIM RESULTS OF OPERATIONS
- -----------------------------
Comparison of the three months ended September 30, 1994 to the three months
- ---------------------------------------------------------------------------
ended September 30, 1993.
- -------------------------
Net sales for the current quarter increased $6,951,000 or 4.3% from the
comparable quarter in 1993. The largest percentage increase was at the
Canadian Division. The increase in sales was predominantly due to volume
increases.
Cost of goods sold as a percentage of net sales for the third quarter of 1994 of
65% was slightly higher than the 64.8% during the comparable quarter in 1993.
This 65% cost of goods sold percentage in the third quarter was lower than the
65.9% cost of goods sold percentage of the first six months as a result of
slightly higher unit pricing and the Company's continuing cost reduction
efforts.
Selling, general and administrative (S.G. & A.) expenses decreased by
$720,000 over the comparable period in 1993. As a percentage of net sales,
S.G.& A. expenses were 26.4% in 1994 compared to 28% in 1993. This decrease
in expenses reflects reductions in new customer acquisition costs and provisions
for bad debts during the third quarter partially offset by higher shipping
costs due to increased sales.
The provision for restructuring charges includes costs for facilities
consolidations. An additional $440,000 was provided for in the third quarter of
1993. (See note 10.)
Other income - net increased by $183,000 primarily due to higher earnings at
Blue Streak Electronics, Inc., the Canadian joint venture, partially offset by a
lower rate of return on investments.
Interest expense increased by $118,000 due to an increased level of
borrowings in 1994, partially offset by a lower average effective borrowing
rate on total borrowings.
Taxes based on earnings increased by $1,237,000 due to both a higher
effective tax rate of 34% in 1994 as compared to 32.5% in 1993 and higher
earnings. The higher effective tax rate in 1994 was primarily due to lower
earnings of the Company's Puerto Rican and Hong Kong subsidiaries and
higher earnings of the Company's Canadian Division.
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STANDARD MOTOR PRODUCTS, INC. AND SUBSIDIARIES
----------------------------------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
-------------------------------------------------
CONDITION AND RESULTS OF OPERATIONS
-----------------------------------
Comparison of the nine months ended September 30, 1994 to the nine months
- -------------------------------------------------------------------------
ended September 30, 1993.
- -------------------------
Net sales for the nine months increased $52,766,000 or 11.7% from the comparable
period in 1993. Sales increases were evident in all divisions with the largest
percentage increases at the Temperature Control Division and the Canadian
Division. The increase in sales was predominantly due to volume increases.
Cost of goods sold as a percentage of net sales for the nine months ended
September 30, 1994 of 65.6% was higher than the 64.6% during the comparable
period in 1993. The increase reflects the required price reductions implemented
early in the first quarter to respond to competitive actions. It also reflects
the continuing shift of sales mix to lower margin segments. The Company
is aggressively implementing cost reduction programs, and although the
results of these programs have had a positive impact upon third quarter
gross margins, many of these programs have not yet achieved their full
impact. However, any favorable impacts could be offset by an acceleration of
material inflation or a further shift to lower margin segments.
Selling, general and administrative (S.G. & A.) expenses increased by $9,145,000
over the comparable period in 1993. As a percentage of net sales, S.G.& A.
expenses were 27.3% in 1994 compared to 28.4% in 1993. The expense increase
was primarily due to increased new customer acquisition costs, higher variable
costs due to increased sales and costs to support the service line expansion.
New customer acquisition costs decreased during the third quarter of 1994.
The provision for restructuring charges includes costs for facilities
consolidations. The Company began this process in the second quarter of 1993,
recording $560,000, ans subsequently provided an additional $440,000 in the
third quarter and $1,781,000 in the fourth quarter totaling $2,781,000 in
1993. (See note 10.)
Other income - net decreased by $173,000 primarily due to realized gains on
investments sold in the second quarter of 1993 and a lower rate of return on
investments in 1994, partially offset in 1994 by higher earnings at Blue Streak
Electronics, Inc., the Canadian joint venture.
Taxes based on earnings increased by $2,142,000 due to both a higher
effective tax rate of 31.6% in 1994 compared to 29.8% in 1993 and higher
earnings. The higher effective tax rate in 1994 was primarily due to lower
earnings of the Company's Hong Kong subsidiary and higher earnings of the
Company's U.S. and Canadian Divisions.
Cumulative effect of changes in accounting for postretirement benefits and
income taxes, net is the result of the Company adopting, as of January 1, 1993,
two changes in accounting principles, Statement of Financial Accounting
Standards (SFAS) No. 106 - "Employers' Accounting for Postretirement Benefits
Other Than Pensions" and SFAS No. 109 - "Accounting for Income Taxes".
The after-tax charge for SFAS No. 106 of $6,135,000 (after an income tax benefit
of $4,090,000), combined with the tax benefit for SFAS No. 109 of $5,045,000
reduced net earnings by $1,090,000 in the first quarter of 1993.
- 12 -
PART II - OTHER INFORMATION
---------------------------
Item 6. Exhibits and Reports on Form 8-K
- ------------------------------------------
On July 6, 1994 the Company filed Form 8-K reporting that it had terminated
David Berdon & Co. as the independent accountant and engaged KPMG Peat
Marwick LLP as its new independent accountant.
This change was not due to disagreements between the Registrant and David
Berdon & Co.
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.
STANDARD MOTOR PRODUCTS, INC.
-----------------------------
(Registrant)
November 14, 1994 Michael J. Bailey
- ----------------- -----------------------------------
(Date) Vice President Finance,
Chief Financial Officer
- 13 -
