>
<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 March 31, 1996
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 March 31, 1996
Common Stock - $1.00 Par Value 23,969,867
Class A Stock - $1.00 Par Value 4,725,000
- 1 of 10 -
<PAGE> 2
THE STANDARD REGISTER COMPANY
INDEX
Page
No.
PART I - FINANCIAL STATEMENTS
Balance Sheet
March 31, 1996, December 31, 1995 3
Statement of Income
13 Weeks Ended March 31, 1996 and April 2, 1995 4
Statement of Cash Flows
13 Weeks Ended March 31, 1996 and April 2, 1995 5
The 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 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
December 31, 1995.
The 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 6-7
PART II - OTHER INFORMATION AND SIGNATURE 8-10
- 2 -
<PAGE> 3
<TABLE>
THE STANDARD REGISTER COMPANY
BALANCE SHEET
(Dollars in Thousands)
(Unaudited)
<CAPTION>
March 31, December 31,
1996 1995
ASSETS
<S> <C> <C>
CURRENT ASSETS
Cash and Cash Equivalents $ 63,559 $ 33,646
Investment held to maturity 1,315 1,330
Accounts Receivable, less Allowance
for Losses 164,445 181,709
Inventories 97,069 97,817
Deferred Income Tax 10,610 10,611
Prepaid Expense 5,218 3,878
Total Current Assets 342,216 328,991
PLANT AND EQUIPMENT
Buildings and Improvements 57,500 57,340
Machinery and Equipment 215,060 212,221
Office Equipment 48,210 43,945
Total 320,770 313,506
Less Accumulated Depreciation 136,042 127,871
Depreciated Cost 184,728 185,635
Construction in Process 32,155 27,027
Land 3,312 3,312
Total Plant and Equipment 220,195 215,974
OTHER ASSETS
Goodwill, Patents, and Other 2,790 2,842
Investment in F3 2,760 3,150
Investment in Polyforms Joint Venture 4,610 4,546
Total Other Assets 10,160 10,538
TOTAL ASSETS 572,571 555,503
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Current Maturities of Long-Term Debt 6,471 6,471
Accounts Payable 19,309 19,025
Dividends Payable - 5,441
Accrued Compensation 23,687 31,973
Accrued Retirement Expense 4,871 2,886
Accrued Other Expense 4,116 6,774
Accrued Taxes, except Income 6,211 5,140
Income Taxes Payable 9,163 2,534
Customer Deposits 14,838 8,334
Deferred Service Contract Income 10,765 8,455
Total Current Liabilities 99,431 97,033
LONG-TERM LIABILITIES
Long-Term Debt 4,600 4,600
Retiree Healthcare 26,101 26,101
Deferred Income Taxes 16,552 16,552
Total Long-Term Liabilities 47,253 47,253
SHAREHOLDERS' EQUITY
Common Stock, $1.00 Par Value
24,197,313 Shares Issued in 1996 24,197
24,141,758 Shares Issued in 1995 24,142
Class A Stock, $1.00 Par Value
4,725,000 Shares Outstanding 4,725 4,725
Capital in Excess of Stated Value 28,513 27,450
Retained Earnings 372,886 359,334
Treasury Stock, 201,741 Shares at Cost (4,434) (4,434)
Total Shareholders' Equity 425,887 411,217
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY $572,571 $555,503
- 3 -
</TABLE>
<PAGE> 4
<TABLE>
THE STANDARD REGISTER COMPANY
STATEMENT OF INCOME
(In Thousands except Data Per Share)
(Unaudited)
<CAPTION>
First Quarter
13 Weeks Ended
March 31, April 2,
1996 1995
<S> <C> <C>
TOTAL REVENUE $229,673 $204,499
COSTS AND EXPENSES
Cost of Products Sold 144,383 129,990
Engineering & Research 2,019 2,012
Selling and Administrative 52,168 46,805
Depreciation and Amortization 8,255 7,375
Interest 165 277
Total Costs and Expenses 206,990 186,459
INCOME BEFORE INCOME TAXES 22,683 18,040
Income Taxes 9,120 7,259
NET INCOME $ 13,563 $ 10,781
Average Number of Shares
Outstanding (000) 28,687 28,657
DATA PER SHARE
Net Income Primary and
Fully Diluted $ 0.47 $ 0.38
Dividends Paid 0.19 0.18
- 4 -
</TABLE>
<PAGE> 5
<TABLE>
THE STANDARD REGISTER COMPANY
STATEMENT OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
<CAPTION>
First Quarter
13 Wks Ended
March 31, April 2,
1996 1995
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $ 13,563 $ 10,781
Add Items not Affecting Cash:
Depreciation and Amortization 8,255 7,375
Loss on Sale of Facilities 1 5
Net change to Investments 390 -
Increase (Decrease) in Cash Arising from
Changes in Asset and Liabilities:
Accounts Receivable 17,264 8,534
Inventories 749 (12,892)
Other Assets (1,329) (2,061)
Accounts Payable 284 (2,241)
Accrued Expenses (7,887) (7,747)
Income Taxes Payable 6,629 4,177
Customer Deposits 6,504 (2,995)
Deferred Service Income 2,310 3,752
Net Adjustments 33,170 (4,093)
Net Cash Provided by Operating Activities 46,733 6,688
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from Sale of Facilities 18 57
Proceeds from Sale of Short-term investments 15 -
Additions to Plant and Equipment (12,455) (15,974)
Investment in Polyforms Joint Venture (64) (710)
Net Cash (Used in) Investing Activities (12,486) (16,627)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from Issuance of Common Stock 1,118 1,000
Dividends Paid (5,452) (5,160)
Net Cash (Used in) by Financing Activities (4,334) (4,160)
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS 29,913 (14,099)
Cash and Cash Equivalents, Beginning 33,646 55,235
CASH AND CASH EQUIVALENTS, ENDING $ 63,559 $ 41,136
- 5 -
</TABLE>
<PAGE> 6
THE STANDARD REGISTER COMPANY
MANAGEMENT DISCUSSION AND ANALYSIS
OF THE INTERIM FINANCIAL STATEMENTS
Net income from the first quarter 1996 was $13.6 million, a 26% increase
compared to the $10.8 million result for the comparable quarter of 1995;
earnings per share were $.47 vs. $.38 a year earlier. The growth in net
income was attributed to increased revenue, up 12% overall, and lower
paper costs.
The Document Management Division's revenue increased 15% to $181 million.
Unit growth was 5%. Revenues from targeted growth segments, including
Pressure Sensitive, Imaging, Stanfast, Distribution , and Electronic
products and services were up 30%. By comparison, revenues from
traditional business forms products rose 3%.
Communicolor's revenue was $25 million, unchanged as a result of softened
demand in the promotional mail market. Management expects the promotional
mail market to improve during the second half of the year. The Document
Systems Division's revenue rose 5% to $23 million resulting from a 9%
increase in both equipment and supplies revenue and a 2% increase in
maintenance revenue.
Gross margin was 37.1% of revenue in the first quarter of 1996, compared
to 36.4% in the comparable period of the prior year. The improvement was
primarily attributable to a decrease in paper price levels and the absence
of a LIFO inventory adjustment in the current quarter. The Company
recorded a pretax LIFO inventory charge of $2.5 million or $.05 per share
in the first quarter of 1995. At this writing, paper companies have
announced increases in paper prices which will become effective over the
next several months. Paper prices are expected to remain below year-end
1995 levels, however. Under this scenario, the Company would expect its
year-end LIFO inventory adjustment to be favorable.
Selling, administrative, and R&D expenses increased 11% overall reflecting
higher sales commissions and increased sales support expenses associated
with the 12% increase in revenue. Depreciation expense rose 12%,
reflecting higher capital spending and the effect of the March, 1995
acquisition of FCA, a division of Capital Graphics, Inc. Interest expense
decreased 40% as a result of a $6.5 million decrease in outstanding debt.
The Company's financial condition remains exceptionally strong. Cash and
investments exceeded total debt at the end of the quarter by $54 million;
this net cash position compares favorably to $24 million at year-end 1995.
- 6 -
<PAGE> 7
This $30 million increase resulted from record first quarter net income,
a 9% reduction in accounts receivable outstanding, and a $6.5 million
increase in customer deposits.
At quarter-end, cash and cash equivalents stood at $63.6 million. Current
assets were 3.4 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.
- 7 -
<PAGE> 8
THE STANDARD REGISTER COMPANY
PART II - OTHER INFORMATION
ITEMS 1 THRU 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.
- 8 -
<PAGE> 9
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.
April 30, 1996
THE STANDARD REGISTER COMPANY
/s/ C. J. Brown
By C. J. Brown, Sr. Vice President, Administration,
Treasurer & Chief Financial Officer
- 9 -
<PAGE> 10
EXHIBIT INDEX
Number Description
27 Financial Data Schedule
- 10 -
<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
March 31, 1996, and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> Dec-29-1996
<PERIOD-END> Mar-31-1996
<CASH> 63,559
<SECURITIES> 1,315
<RECEIVABLES> 170,526
<ALLOWANCES> 6,081
<INVENTORY> 97,069
<CURRENT-ASSETS> 342,216
<PP&E> 356,237
<DEPRECIATION> 136,042
<TOTAL-ASSETS> 572,571
<CURRENT-LIABILITIES> 99,431
<BONDS> 11,071
<COMMON> 28,922
0
0
<OTHER-SE> 396,965
<TOTAL-LIABILITY-AND-EQUITY> 572,571
<SALES> 229,197
<TOTAL-REVENUES> 229,673
<CGS> 144,383
<TOTAL-COSTS> 206,990
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 455
<INTEREST-EXPENSE> 165
<INCOME-PRETAX> 22,683
<INCOME-TAX> 9,120
<INCOME-CONTINUING> 13,563
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 13,563
<EPS-PRIMARY> 0.47
<EPS-DILUTED> 0.47
</TABLE>
