<PAGE> 1
UNITED STATES
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 Quarter Ended April 2, 1995
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 01-1097
THE STANDARD REGISTER COMPANY
OHIO CORPORATION 31-0455440
600 ALBANY STREET, DAYTON, OHIO 45401
TELEPHONE NUMBER 513-443-1000
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Secu-
rities 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. .
CLASS OUTSTANDING AS OF April 2, 1995
Common Stock - $1.00 Par Value 23,940,017
Class A Stock - $1.00 Par Value 4,725,000
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THE STANDARD REGISTER COMPANY
INDEX
Page
No.
PART I - FINANCIAL STATEMENTS
Consolidated Balance Sheet
April 2, 1995, January 1, 1995 3
Consolidated Statement of Income
13 Weeks Ended April 2, 1995 and April 3, 1994 4
Consolidated Statement of Cash Flows
13 Weeks Ended April 2, 1995 and April 3, 1994 5
The consolidated financial statements of the Registrant included
herein have been prepared, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Although
certain information normally included in financial statements
prepared in accordance with generally accepted accounting
principles has been condensed or omitted, the Registrant believes
that the disclosures are adequate to make the information presented
not misleading. It is suggested that these consolidated financial
statements be read in conjunction with the financial statements and
notes thereto included in the Annual Report on Form 10-K of the
Registrant for the year ended January 1, 1995.
The consolidated financial statements included herein reflect all
adjustments (consisting only of normal recurring accruals) which,
in the opinion of management, are necessary to present a fair
statement of the results for the interim periods.
The results for interim periods are not necessarily indicative of
trends or of results to be expected for a full year.
Management's Discussion and Analysis of the Interim
Financial Statements 6
PART II - OTHER INFORMATION AND SIGNATURE 8-10
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<TABLE>
THE STANDARD REGISTER COMPANY
CONSOLIDATED BALANCE SHEET
(Dollars in Thousands)
(Unaudited)
<CAPTION>
April 2, January 1,
1995 1995
ASSETS
<S> <C> <C>
CURRENT ASSETS
Cash and Cash Equivalents $ 41,136 $ 55,235
Accounts Receivable, less Allowance
for Losses 143,418 151,952
Inventories 113,565 100,673
Deferred Income Tax 9,592 9,592
Prepaid Expense 5,459 4,039
Total Current Assets $313,170 $321,491
PLANT AND EQUIPMENT
Buildings and Improvements $ 59,404 $ 57,472
Machinery and Equipment 203,451 193,187
Office Equipment 35,583 37,904
Total 298,438 288,563
Less Accumulated Depreciation 128,568 121,267
Depreciated Cost 169,870 167,296
Construction in Process 34,224 28,720
Land 3,289 2,789
Total Plant and Equipment $207,383 $198,805
OTHER ASSETS
Goodwill, Patents, and Other 2,992 2,391
Investment in Polyforms Joint Venture 3,682 2,972
Total Other Assets $ 6,674 $ 5,363
TOTAL ASSETS $527,227 $525,659
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Current Maturities of Long-Term Debt $ 6,471 $ 6,471
Accounts Payable 16,829 19,071
Dividends Payable - 5,149
Accrued Compensation 21,671 27,994
Accrued Retirement Expense 4,320 4,139
Accrued Other Expense 804 2,230
Accrued Taxes, except Income 5,002 5,181
Income Taxes Payable 6,455 2,278
Customer Deposits 6,813 9,807
Deferred Service Contract Income 11,112 7,360
Total Current Liabilities $ 79,477 $ 89,680
LONG-TERM LIABILITIES
Long-Term Debt $ 11,071 $ 11,071
Retiree Healthcare 25,125 25,125
Deferred Income Taxes 15,817 15,817
Total Long-Term Liabilities $ 52,013 $ 52,013
SHAREHOLDERS' EQUITY
Common Stock, $1.00 Par Value
24,141,758 Shares Issued in 1995 $ 24,142
24,084,632 Shares Issued in 1994 $ 24,085
Class A Stock, $1.00 Par Value
4,725,000 Shares Outstanding 4,725 4,725
Capital in Excess of Stated Value 27,450 26,507
Retained Earnings 343,272 332,501
Treasury Stock, 201,741 Shares at Cost (3,852) (3,852)
Total Shareholders' Equity $395,737 $383,966
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY $527,227 $525,659
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</TABLE>
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<TABLE>
THE STANDARD REGISTER COMPANY
CONSOLIDATED STATEMENT OF INCOME
(In Thousands except Data Per Share)
(Unaudited)
<CAPTION>
First Quarter
13 Weeks Ended
April 2, April 3,
1995 1994
<S> <C> <C>
TOTAL REVENUE $ 204,499 $ 183,875
COSTS AND EXPENSES
Cost of Products Sold $ 129,990 $ 116,258
Engineering & Research 2,012 1,896
Selling and Administrative 46,805 42,385
Depreciation and Amortization 7,375 6,311
Interest 277 206
Total Costs and Expenses $ 186,459 $ 167,056
INCOME BEFORE INCOME TAXES $ 18,040 $ 16,819
Income Taxes 7,259 6,803
NET INCOME $ 10,781 $ 10,016
Average Number of Shares
Outstanding (000) 28,657 28,713
DATA PER SHARE
Net Income Primary and
Fully Diluted $ 0.38 $ 0.35
Dividends Paid $ 0.18 $ 0.17
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</TABLE>
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<TABLE>
THE STANDARD REGISTER COMPANY
CONSOLIDATED STATEMENT OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
<CAPTION>
First Quarter
13 Wks Ended
April 2, April 3,
1995 1994
<S>
CASH FLOWS FROM OPERATING ACTIVITIES <C> <C>
Net Income $ 10,781 $ 10,016
Add Items not Affecting Cash:
Depreciation and Amortization $ 7,375 $ 6,311
Loss on Sale of Facilities 5 33
Increase (Decrease) in Cash Arising from
Changes in Asset and Liabilities:
Accounts Receivable 8,534 6,774
Inventories (12,892) (2,680)
Other Assets (2,061) (215)
Accounts Payable (2,242) (5,830)
Accrued Expenses (7,747) (12,578)
Income Taxes Payable 4,177 1,852
Customer Deposits (2,994) -
Deferred Service Income 3,752 3,749
Net Adjustments (4,093 (2,584)
Net Cash Provided by Operating Activities $ 6,688 $ 7,432
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from Sale of Facilities $ 57 $ 2
Additions to Plant and Equipment (15,974) (7,950)
Investment in Polyforms Joint Venture (710) -
Net Cash (Used in) Investing Activities $(16,627) $ (7,948)
CASH FLOWS FROM FINANCING ACTIVITIES
Principal Payments on Long-Term Debt $ - $ (2)
Proceeds from Issuance of Common Stock 1,000 993
Dividends Paid (5,160) (4,882)
Net Cash (Used in) by Financing Activities $ (4,160) $ (3,891)
NET (DECREASE) IN CASH AND
CASH EQUIVALENTS $(14,099) $ (4,407)
Cash and Cash Equivalents, Beginning $ 55,235 $ 78,994
CASH AND CASH EQUIVALENTS, ENDING $ 41,136 $ 74,587
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</TABLE>
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THE STANDARD REGISTER COMPANY
MANAGEMENT DISCUSSION AND ANALYSIS
OF THE INTERIM FINANCIAL STATEMENTS
Net income from the first quarter 1995 was $10.8 million, a 7.6%
increase compared to the $10.0 million result for the comparable
quarter of 1994; earnings per share were $.38 vs. $.35 a year earlier.
Total revenue increased 11.2%, reflecting strong shipment levels in all
major product groups. Business forms products, representing 77% of all
revenue, increased 8%. Revenue from promotional direct mail,
representing 12% of all revenue, was up 35% in major part as a result
of the mid-year 1994 acquisition of the Promotional Graphics Division
of UARCO. Equipment and related maintenance services and supplies
increased 12%, contributing 11% of total revenue.
The Company experienced paper price increases in the first quarter of
1995 continuing the sharp rise in paper prices begun in June 1994.
Additional paper price increases were announced in April 1995 and the
Company expects that further price increases will occur. During the
quarter the Company raised forms prices in order to recover these
higher paper costs and expects that effort will be successful over the
long term. However, the effects of forms price increases will
generally lag behind the effects of increases in paper costs and there
can be no assurances that the Company will be successful in recovering
these cost increases.
As a result of higher paper prices, the Company expects an unfavorable
charge to pretax earnings in 1995. The first quarter pretax charge was
$2.5 million or $.05 per share after tax. Additional LIFO adjustments
are expected for the balance of 1995.
Gross margin, revenue less cost of products sold, increased $6.9
million but represented a lesser percentage of revenue - 36.4% versus a
prior year of 36.8%. Excluding the unfavorable LIFO adjustment, the
gross margin would have improved as a percentage of revenue by .8%.
Selling, administrative, and R&D expenses increased 10.2% overall,
below the 11.2% rate of revenue growth. Depreciation expense rose 17%,
reflecting higher capital spending and the effect of the Promotional
Graphics acquisition. While debt was $6.5 million lower compared to
first quarter 1994, interest expense was higher due to a higher
interest rate environment.
The acquisition by the Company of the FCA Division of Capital Graphics,
Inc., a subsidiary of Household International, Inc. was effective on
March 17, 1995. The acquisition provides the Company with increased
capacity to meet heavy demand for value-added business forms products
such as secure documents, mailers, roll forms, form/label combination
products and laser forms. This division, which had 1994 revenues in
excess of $16 million, will be consolidated with the Company's other
forms plants.
Net cash flow for the first quarter 1995 was a negative $14.1 million
vs. an outflow of $4.4 million for the same period of 1994. The $9.7
million greater outflow in 1995 resulted primarily from the FCA
acquisition and increased capital spending. 1995 capital expenditures
are forecasted at $40 million, including the FCA acquisition.
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At quarter-end, cash and cash equivalents stood at $41.1 million.
Total debt, including current maturities, was $17.5 million, producing
a net cash position of $23.6 million. Current assets were 3.9 times
the level of current liabilities. The Company believes that a
combination of internally generated funds and current cash reserves
will be adequate to meet operating and financing needs for the near
term.
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THE STANDARD REGISTER COMPANY
PART II - OTHER INFORMATION
ITEMS 1 THRU 3
None
ITEM 4 Submission of Matters to a Vote of Security Holders
The Company's Annual Meeting of Shareholders was held on April 19, 1995.
Following is the result of voting by the Shareholders regarding fixing and
determining the number of Directors to be ten.
IN FAVOR OPPOSED ABSTAINED
45,624,229 26,808 37,013
As a result of voting of the Shareholders, the following were elected to
the Company's Board of Directors to hold office for the ensuing year.
NOMINEE IN FAVOR WITHHELD
Roy W. Begley, Jr. 45,582,187 105,863
Ralph R. Burchenal 45,638,707 49,343
F. David Clarke, III 45,636,664 51,386
John K. Darragh 45,605,934 82,116
Paul H. Granzow 45,604,671 83,379
Mary C. Nushawg 45,581,922 106,128
Peter S. Redding 45,606,837 81,213
John J. Schiff, Jr. 45,639,437 48,613
Charles F. Sherman 45,603,922 84,128
John Q. Sherman 45,605,099 82,951
The following is the tabulation of Shareholder votes on the proposal to
amend Article Fourth of the Amended Articles of Incorporation of the
Company to increase the authorized number of shares of stock from
35,225,000 with a par value of $1.00 each, of which 30,500,000 are known
and designated as common stock and of which 4,725,000 are known and
designated as Class A stock to 55,225,000 shares of stock with a par value
of $1.00 each, of which 50,500,000 will be known and designated as common
stock and which 4,725,000 will be known and designated as Class A stock.
IN FAVOR OPPOSED ABSTAINED
44,918,490 730,107 40,247
Following is the result of voting by the Shareholders regarding selection
of Battelle & Battelle as the Corporation's Auditors for the year 1995.
IN FAVOR OPPOSED ABSTAINED
45,663,457 37,040 17,553
No broker non-votes were recorded.
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ITEM 5 - None
ITEM 6 -
(a) Exhibits
Exhibit No. Description
27 Financial Data Schedule
(b) There have been no reports on Form 8-K filed during the
quarter for which this report on Form 10-Q is being filed.
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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.
May 17, 1995
THE STANDARD REGISTER COMPANY
/s/ C. J. Brown
By C. J. Brown, Senior Vice President-
Administration, Finance,
Treasurer & Chief Financial
Officer
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EXHIBIT INDEX
Number Description
27 Financial Data Schedule
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The Standard Register Company
Financial Data Schedule
This schedule contains summary financial information extracted from the
Standard Register Company financial statements for the quarter ended April
2, 1995, and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-START> Jan-02-1995
<FISCAL-YEAR-END> Dec-31-1995
<PERIOD-END> Apr-02-1995
<CASH> 41,136
<SECURITIES> 0
<RECEIVABLES> 147,917
<ALLOWANCES> 4,499
<INVENTORY> 113,565
<CURRENT-ASSETS> 313,170
<PP&E> 335,951
<DEPRECIATION> 128,568
<TOTAL-ASSETS> 527,227
<CURRENT-LIABILITIES> 79,477
<BONDS> 17,542
<COMMON> 28,867
0
0
<OTHER-SE> 366,870
<TOTAL-LIABILITY-AND-EQUITY> 527,227
<SALES> 204,024
<TOTAL-REVENUES> 204,499
<CGS> 129,990
<TOTAL-COSTS> 186,459
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 712
<INTEREST-EXPENSE> 277
<INCOME-PRETAX> 18,040
<INCOME-TAX> 7,259
<INCOME-CONTINUING> 10,781
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 10,781
<EPS-PRIMARY> 0.38
<EPS-DILUTED> 0.38
</TABLE>
