SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 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 0-1349
Stanhome Inc.
___________________________________________________________________________
(Exact name of registrant as specified in its charter)
Massachusetts 04-1864170
____________________________________ ______________________
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
333 Western Avenue, Westfield, Massachusetts 01085
___________________________________________________________________________
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 413-562-3631
___________________________________________________________________________
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 [_]
June 30,
1996 1995
____ ____
Shares Outstanding:
Common Stock with
Associated Rights 17,898,467 18,791,638
Total number of pages
contained herein 28
Index to Exhibits is
on page 20
<PAGE>
<TABLE>
PART I. FINANCIAL INFORMATION
------------------------------
STANHOME INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
JUNE 30, 1996 and DECEMBER 31, 1995
(Unaudited)
<CAPTION>
June 30, December 31,
1996 1995
---- ----
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and certificates of deposit $ 20,477,816 $ 23,053,926
Notes and accounts receivable, net 195,200,578 158,572,959
Inventories 120,726,325 114,294,928
Prepaid advertising 35,089,298 39,665,306
Other prepaid expenses 10,229,615 6,784,465
------------ ------------
Total current assets 381,723,632 342,371,584
------------ ------------
PROPERTY, PLANT AND EQUIPMENT, at cost 132,359,252 131,795,141
Less - Accumulated depreciation and
amortization 73,494,942 70,947,871
------------ ------------
58,864,310 60,847,270
------------ ------------
OTHER ASSETS:
Goodwill and other intangibles, net 120,773,283 119,826,382
Other 13,063,529 11,420,987
------------ ------------
133,836,812 131,247,369
------------ ------------
$574,424,754 $534,466,223
============ ============
<FN>
The accompanying notes are an integral part of these condensed financial
statements.
</TABLE>
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<PAGE>
<TABLE>
STANHOME INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
JUNE 30, 1996 and DECEMBER 31, 1995
(Unaudited)
<CAPTION>
June 30, December 31,
1996 1995
---- ----
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes and loans payable $125,957,176 $ 74,864,065
Accounts payable 57,832,607 64,880,028
Federal, state and foreign taxes
on income 32,077,104 28,758,277
Accrued expenses--
Payroll and commissions 12,951,138 13,658,026
Royalties 9,987,908 8,587,986
Vacation, sick and postretirement
benefits 7,824,678 6,979,623
Pensions and profit sharing 6,046,753 8,610,616
Other 38,480,062 36,106,020
------------ ------------
Total current liabilities 291,157,426 242,444,641
------------ ------------
LONG-TERM LIABILITIES:
Foreign employee severance obligations 12,707,192 12,482,097
Postretirement benefits 12,789,255 12,749,258
------------ ------------
Total long-term liabilities 25,496,447 25,231,355
------------ ------------
SHAREHOLDERS' EQUITY:
Common stock 3,153,530 3,153,530
Capital in excess of par value 44,705,463 43,098,856
Retained earnings 390,412,975 385,008,394
Cumulative translation adjustments ( 28,612,995) ( 27,409,482)
------------ ------------
409,658,973 403,851,298
Less - Shares held in treasury, at cost 151,888,092 137,061,071
------------ ------------
Total shareholders' equity 257,770,881 266,790,227
------------ ------------
$574,424,754 $534,466,223
============ ============
<FN>
The accompanying notes are an integral part of these condensed financial
statements.
</TABLE>
-3-
<PAGE>
<TABLE>
STANHOME INC.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
FOR THE QUARTERS ENDED JUNE 30, 1996 and 1995 (Unaudited)
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
NET SALES $217,724,172 $209,489,366
COST OF SALES 95,095,791 88,567,476
------------ ------------
GROSS PROFIT 122,628,381 120,921,890
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSE 100,008,670 97,920,280
------------ ------------
OPERATING PROFIT 22,619,711 23,001,610
Interest expense ( 2,105,054) ( 1,936,735)
Other expense, net ( 783,212) ( 438,711)
------------ ------------
INCOME BEFORE INCOME TAXES 19,731,445 20,626,164
Income taxes 8,780,493 9,457,068
------------ ------------
NET INCOME $ 10,950,952 $ 11,169,096
============ ============
EARNINGS PER COMMON SHARE,
primary and fully diluted $ .60 $ .59
===== =====
<FN>
The accompanying notes are an integral part of these condensed financial
statements.
</TABLE>
-4-
<PAGE>
<TABLE>
STANHOME INC.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME AND RETAINED EARNINGS
FOR THE SIX MONTHS ENDED JUNE 30, 1996 and 1995 (Unaudited)
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
NET SALES $400,763,899 $394,358,528
COST OF SALES 173,188,356 165,993,464
------------ ------------
GROSS PROFIT 227,575,543 228,365,064
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSE 194,560,707 191,593,349
------------ ------------
OPERATING PROFIT 33,014,836 36,771,715
Interest expense ( 3,951,112) ( 3,279,032)
Other expense, net ( 1,582,937) ( 596,178)
------------ ------------
INCOME BEFORE INCOME TAXES 27,480,787 32,896,505
Income taxes 12,459,503 15,277,068
------------ ------------
NET INCOME 15,021,284 17,619,437
RETAINED EARNINGS, beginning of
period 385,008,394 362,946,840
Cash dividends, $.53 per share in
1996 and 1995 ( 9,616,703) ( 10,004,986)
------------ ------------
RETAINED EARNINGS, end of period $390,412,975 $370,561,291
============ ============
EARNINGS PER COMMON SHARE:
Primary and fully diluted $ .82 $ .93
===== =====
<FN>
The accompanying notes are an integral part of these condensed financial
statements.
</TABLE>
-5-
<PAGE>
<TABLE>
STANHOME INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1996 and 1995 (Unaudited)
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
OPERATING ACTIVITIES:
Net cash used by
operating activities ($25,884,695) ($18,802,821)
----------- -----------
INVESTING ACTIVITIES:
Purchase of property, plant
and equipment ( 3,910,264) ( 5,294,924)
Payments for acquisition of businesses,
net of cash acquired ( 1,484,383) ( 1,429,057)
Proceeds from sales of property,
plant and equipment 2,574,793 741,402
Other, principally marketable
securities - 114,243
----------- -----------
Net cash used by investing activities ( 2,819,854) ( 5,868,336)
----------- -----------
FINANCING ACTIVITIES:
Cash dividends ( 9,616,703) ( 10,004,986)
Exchanges and purchases of common stock ( 15,178,033) ( 11,800,149)
Notes and loans payable 49,650,150 65,075,904
Exercise of stock options 1,690,544 805,307
Other common stock issuance 267,075 342,512
----------- -----------
Net cash provided by
financing activities 26,813,033 44,418,588
----------- -----------
Effect of exchange rate changes on
cash and cash equivalents ( 684,594) 391,717
----------- -----------
Increase/(decrease) in cash and
cash equivalents ( 2,576,110) 20,139,148
Cash and cash equivalents,
beginning of year 23,051,926 19,349,839
----------- -----------
Cash and cash equivalents,
end of quarter $20,475,816 $39,488,987
=========== ===========
SUPPLEMENTAL CASH FLOW DATA
Cash paid for:
Interest $ 2,760,982 $ 2,646,470
Income taxes $ 9,237,855 $23,768,333
<FN>
The accompanying notes are an integral part of these condensed financial
statements.
</TABLE>
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<PAGE>
STANHOME INC.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
The consolidated condensed financial statements and related notes
included herein have been prepared by the Company, without audit except for
the December 31, 1995 condensed balance sheet, which was derived from the
Annual Report on Form 10-K, pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations, although the
Company believes that the disclosures are adequate to make the information
presented not misleading. The information furnished reflects all normal
recurring adjustments which are, in the opinion of management, necessary to
a fair statement of the results for the interim periods. It is suggested
that these condensed financial statements be read in conjunction with the
financial statements and related notes to consolidated financial statements
included in the Company's Annual Report on Form 10-K for the year ended
December 31, 1995.
1. ACCOUNTING POLICIES:
The Company's financial statements for the three and six months ended
June 30, 1996 have been prepared in accordance with the accounting policies
described in Note 1 to the December 31, 1995 consolidated financial
statements included in the Company's 1995 Annual Report on Form 10-K. The
Company considers all highly liquid securities, including certificates of
deposit with maturities of three months or less, when purchased, to be cash
equivalents. Notes and accounts receivable were net of reserves for
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<PAGE>
uncollectible accounts, returns and allowances of $23,124,000 at June 30,
1996 and $20,741,000 at December 31, 1995.
The Company recognizes revenue as merchandise is turned over to the
shipper and a provision for anticipated merchandise returns and allowances
is recorded based upon historical experience. Amounts billed to customers
for shipping and handling orders are netted against the associated costs.
2. INVENTORY CLASSES:
The major classes of inventories at June 30 and December 31 were as
follows (in thousands):
June 30, December 3l,
1996 1995
---- ----
Raw materials and supplies $ 7,546 $ 7,312
Work in process 1,258 1,237
Finished goods in transit 14,805 16,215
Finished goods 97,117 89,531
-------- --------
$120,726 $114,295
======== ========
3. OTHER EXPENSE, NET:
Other expense, net for the quarters and six months ended June 30,
1996 and 1995 consists of the following (in thousands):
Quarters Ended June 30
----------------------
1996 1995
---- ----
Interest income $ 733 $ 761
Other assets amortization ( 1,200) ( 1,008)
Other items, net ( 316) ( 191)
------ ------
($ 783) ($ 438)
====== ======
Six Months Ended June 30
------------------------
1996 1995
---- ----
Interest income $1,226 $1,506
Other assets amortization ( 2,353) ( 2,017)
Other items, net ( 456) ( 85)
------ ------
($1,583) ($ 596)
====== ======
-8-
<PAGE>
4. EARNINGS PER COMMON SHARE (BASIS OF CALCULATION):
Earnings per common share are based on the average number of common
shares outstanding and common share equivalents for the periods covered.
For both years, there was no difference in earnings per share between
primary and fully diluted earnings per share computations. For the second
quarter, the average number of shares utilized in the fully diluted
computation was 18,218,514 and 18,913,987 shares for 1996 and 1995,
respectively. The average number of shares utilized in the fully diluted
computation for the six months ended June 30 was 18,299,763 for 1996 and
19,034,754 for 1995. Both 1996 computations included common share
equivalents of 66,434 and both 1995 computations included common share
equivalents of 112,814. The lower average number of shares for the second
quarter and first six months of 1996 primarily resulted from the
repurchase of shares as part of the Company's repurchase program.
5. FINANCIAL INSTRUMENTS:
The Company enters into various short-term foreign exchange
agreements during the year, all of which are held for purposes other than
trading. The purpose of the Company's foreign currency hedging activities
is to protect the Company from risk that the eventual settlement of
foreign currency transactions will be adversely affected by changes in
exchange rates. The Company's various subsidiaries import products in
foreign currencies and from time to time will enter into agreements or
build foreign currency deposits as a partial hedge against currency
fluctuations on inventory purchases. Gains and losses on these agreements
are deferred and recorded as a component of cost of sales when the related
inventory is sold. At June 30, 1996, there were no open inventory
purchase agreements and deferred amounts were not material. The Company
-9-
<PAGE>
makes short-term foreign currency intercompany loans to various
international subsidiaries and utilizes agreements to fully hedge these
transactions against currency fluctuations. The cost of these agreements
is included in the interest charged to the subsidiaries and expensed
monthly as the interest is accrued. The intercompany interest eliminates
upon consolidation and any gains and losses on the agreements are recorded
as a component of other expense. All of the outstanding agreements as of
June 30, 1996 are to hedge intercompany loans. The Company receives
dividends, technical service fees, royalties and other payments from its
subsidiaries and licensees. From time to time, the Company will enter into
foreign currency forward agreements as a partial hedge against currency
fluctuations on these current receivables. Gains and losses are recognized
or the credit or debit offsets the foreign currency payables. As of June
30, 1996, net deferred amounts on outstanding agreements were not material.
The outstanding agreement amounts (notional value) at June 30, 1996, are as
follows (in thousands):
Canada $ 6,602
Germany 3,938
U.S. 1,900
-------
Total $12,440
=======
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<PAGE>
STANHOME INC.
QUARTER AND SIX MONTHS ENDED JUNE 30, 1996
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
BUSINESS SEGMENTS of the Company's operations are summarized on Page
18. A discussion and analysis of the segments follows:
GIFTWARE
Giftware Group sales increased 7% for the second quarter and 1% for
the first six months primarily due to unit volume growth in the United
States from existing lines. International sales decreased slightly and
represented 15% of year-to-date sales in both 1996 and 1995. Year-to-date
1996 sales of the Precious Moments line represented 44% of total sales
compared to 48% in 1995 and the Cherished Teddies line represented 17% of
year-to-date sales in 1996 compared to 10% in 1995. Operating profit for
the first six months as a percentage of sales was 12.7% in 1996 compared to
13.8% in 1995. The decrease was due to higher cost of sales (approximately
.7%) from an unfavorable product mix and to a higher percentage of selling,
general and administrative expenses. Most of the operating profit decrease
was from international markets. Operating profit in the United States was
down approximately 1%.
DIRECT RESPONSE
Direct Response Group sales decreased 5% in the second quarter but
were 4% higher for the six months due to unit volume growth from increased
product offerings primarily in the figural categories. Year-to-date doll
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<PAGE>
sales decreased to 19% of 1996 sales compared to 33% in 1995 and plate
sales decreased to 35% of sales in 1996 compared to 43% in 1995. The
Precious Moments line represented 10% of year-to-date 1996 sales compared
to 11% in 1995 and the Cherished Teddies line represented 10% of year-to-
date sales in both 1996 and 1995. International sales decreased and
operating losses increased for the quarter and year-to-date. International
sales represented 9% of the first six months sales compared to 10% in 1995.
Market conditions for the direct response businesses for the Company's
products continue to be soft and very competitive with many product
offerings and ads going against weakness in consumer spending. Operating
losses increased for the second quarter and first six months. For the
first six months, cost of sales as a percentage of sales increased 2.9% due
to product mix and higher product returns. For the first six months, total
selling, general and administrative expenses decreased as a percentage of
sales due to a lower percentage of advertising (47% of sales in 1996 versus
51% in 1995) due to product sales mix and a higher percentage of sales from
existing customer lists. Partially offsetting the improved advertising
ratio was a higher level of selling, general and administrative expenses,
including higher bad debts and approximately $460 thousand of expense
during the second quarter for new market testing.
DIRECT SELLING
Total Direct Selling sales for the quarter and first six months were
about level with 1995. Operating profit decreased for the quarter and
first six months of 1996. Operating profit for the first six months as a
percentage of sales was 10.0% in 1996 compared to 11.3% in 1995. The
decrease was due to higher cost of sales (approximately .5%) from product
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<PAGE>
mix and a higher percentage of selling, general and administrative
expenses.
European sales decreased 3% and 1% for the quarter and first six
months, respectively, and represented 87% of total 1996 sales for the
quarter and 88% for the year-to-date. Operating profit decreased 27% for
the second quarter and 17% for the first six months, and represented 82%
of total 1996 operating profit for the quarter and 88% for the year-to-
date. Operating profit for the first six months as a percentage of sales
for Europe was down 1.7% compared to 1995. The decrease was due to higher
levels of selling, general and administrative expense principally in Italy
and the impact of full six month expenses of the European headquarters.
The Italian government has introduced new social benefit taxes that have
become effective during the second quarter of 1996. This additional tax
burden has unfavorably impacted the Italian subsidiary's independent
Dealer force and its ability to recruit and retain Dealers. First six
months 1996 European local currency sales and operating profit translated
at 1995 average exchange rates would have resulted in a 3% sales decrease
and a 17% operating profit decrease. Sales for the Mexican and Venezuelan
group increased 33% and 13%, respectively, for the second quarter and
first six months resulting from improvement in Mexico. The group's second
quarter and year-to-date operating profit increased substantially from a
low base and benefited from higher sales in Mexico.
UNALLOCATED EXPENSES increased in the first six months due to higher
compensation, benefits and general expenses consistent with the Company
programs. Unallocated expenses are corporate expenses and other items not
directly related to the operations of the Groups.
-13-
<PAGE>
INTERNATIONAL ECONOMIES AND CURRENCY
The Latin American operations in Mexico and Venezuela have experienced
highly inflationary economies with rapidly changing prices in local
currencies. These conditions, with the resulting adverse impact on local
economies, have made it difficult for operations in these locations to
achieve adequate operating margins. In addition, the strengthening of the
dollar versus Latin American currencies has resulted in lower U.S. dollar
results for these operations. European operations were not materially
impacted by currency translation rates in 1996 compared to 1995. The value
of the U.S. dollar versus international currencies where the Company
conducts business will continue to impact the future results of these
businesses. In addition to the currency risks, the Company's international
operations, including sources of imported products, are subject to other
risks of doing business abroad, including import or export restrictions and
changes in economic and political climates.
The fluctuations in net sales and operating profit margins from
quarter to quarter are partially due to the seasonal characteristics of the
Company's business segments.
INTEREST EXPENSE AND OTHER EXPENSE, NET
Interest expense increased due to higher interest rates and higher
borrowing levels for general working capital and for stock buy backs.
Notes and loans payable going into 1996 were approximately $35.9 million
higher than at the start of 1995. Other assets amortization of goodwill
increased due to the continuing impact from the 1994 acquisitions. The
amortization for Giftware in 1996 was $2.0 million compared to $1.7
million in 1995 and the amortization for Direct Response was $.3 million
in 1996 and $.3 million in 1995.
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<PAGE>
THE EFFECTIVE TAX RATE of 45% was lower than the 46% in 1995 despite
higher non deductible goodwill in 1996. This was due principally to
earnings mix with a lower ratio of foreign income to United States income,
which has a lower rate.
FINANCIAL CONDITION
The Company has historically satisfied its capital requirements with
internally generated funds and short-term loans. Working capital
requirements have seasonal variations during the year and are generally
greatest during the third quarter.
The major sources of funds from operating activities in the first six
months of 1996 were from net income, depreciation, amortization, lower
prepaid expense (from less spending in the media) and higher accrued tax
levels (due to timing of payments). Prepaid expenses are down from June
of last year due principally to less media spending in 1996 by the Direct
Response Group since the focus for sales generation has been toward
existing customers. The major uses of funds were increased accounts
receivable which increased due to the higher sales volume, timing of sales
in the quarter and marketing programs, particularly in Giftware; increased
inventories to support the higher sales volume and from lower sales of in-
stock goods; increased other assets reflecting higher levels of funded
retirement benefits; and lower accounts payable and accrued expenses due
principally to timing and the payment of year end payrolls and benefits.
The June 30, 1996 increase in net accounts receivable compared to 1995 was
due to the timing of sales during the second quarter, more customers with
extended credit terms and higher sales volume. The increase in
inventories in 1996 compared to 1995 was due to increases to support
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<PAGE>
higher levels of sales, lower sales of in-stock goods for the Giftware
Group and higher inventories in the Direct Response Group to provide
customers with quicker fulfillment of orders.
The major uses of cash in investing activities in the first six
months of 1996 were for capital expenditures and the acquisition of a
small French giftware company. The acquisition was accounted for using
the purchase method with basically all of the purchase pricing allocated
to goodwill. The Company has an acquisition program, and may utilize
funds for this purpose in the future. Capital expenditure commitments for
$17 million are forecasted for 1996. Proceeds from the sale of property,
plant and equipment was primarily from the sale of a distribution center
in Charlotte, North Carolina. As of June 30, 1996, two other distribution
centers in the United States with a book value of $622 thousand remain to
be sold. The Italian subsidiary invests excess cash in short-term
investments which change from time to time based on availability and
rates. The level of changes of marketable securities from period to
period principally represents investment alternatives versus certificates
of deposit, time deposits, and intercompany loans.
The major uses of cash in financing activities in the first six
months of 1996 were for dividends to shareholders and purchases of common
stock. Purchases of common stock principally included shares repurchased
by the Company. During the first six months this year, the Company
repurchased 515 thousand shares for $15.2 million. The Company has an
authorized program to purchase shares of stock for the Company treasury
from time to time in the open market, depending on market conditions, and
may utilize funds for this purpose in the future. As of June 30, 1996,
.8 million shares remained available for purchase under the program. The
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<PAGE>
Company's earnings, cash flow, and available debt capacity have made and
make stock repurchases, in the Company's view, one of its best investment
alternatives. The major source of funds from financing activities was
from higher seasonal borrowings. Total stock options outstanding at the
exercise price amounted to $87 million at June 30, 1996 and the Company
could receive these funds in the future if the options are exercised.
Fluctuations in the value of the U.S. dollar versus international
currencies affect the U.S. dollar translation value of international
currency denominated balance sheet items. The changes in the balance sheet
dollar values due to international currency translation fluctuations are
recorded as a component of shareholders' equity. International currency
fluctuations of $1,204,000 increased the cumulative translation component
which contributed to the shareholders' equity decrease in the first six
months of 1996. The translation adjustments to the June 30, 1996 balance
sheet that produced the 1996 change in the cumulative translation component
of shareholders' equity were decreases in working capital by $885,000;
increases in net property, plant and equipment and other assets by
$110,000; and increases in long-term liabilities by $429,000. The Company
depends upon its international operations to pay dividends and to make
other payments to the Company. The Company's international operations are
subject to the risks of doing business abroad including currency, economic
and political.
The Company currently believes that cash from operations and available
financing alternatives are adequate to meet anticipated requirements for
working capital, dividends, capital expenditures, the stock repurchase
program and other needs. No liquidity problems are anticipated.
-17-
<PAGE>
STANHOME INC.
SALES AND OPERATING PROFIT BY BUSINESS SEGMENT
FOR THE SECOND QUARTER AND FIRST SIX MONTHS ENDED JUNE 30, 1996 AND 1995
(Unaudited)
(In Thousands)
<TABLE>
<CAPTION>
Second Quarter First Six Months
----------------------------- ------------------------------
1996 1995 Percent 1996 1995 Percent
Actual Actual Change Actual Actual Change
------ ------ ------- ------ ------ -------
<S> <C> <C> <C> <C> <C> <C>
Net Sales:
Giftware $130,823 $122,126 7% $230,435 $228,081 1%
Direct Response 35,094 37,019 ( 5) 71,781 68,825 4
Direct Selling 52,282 52,114 - 99,930 99,873 -
Eliminations ( 475) ( 1,769) ( 1,382) ( 2,420)
-------- -------- -------- --------
Total Net Sales $217,724 $209,490 4% $400,764 $394,359 2%
======== ======== ======== ========
Operating Profit:
Giftware $ 21,346 $ 19,913 7% $ 29,356 $ 31,412 ( 7%)
Direct Response ( 1,756) ( 852) (106) ( 1,049) ( 868) (21)
Direct Selling 5,512 6,586 (16) 10,015 11,335 (12)
Unallocated Expense ( 2,482) ( 2,645) 6 ( 5,307) ( 5,107) ( 4)
-------- -------- -------- --------
Total Operating Profit $ 22,620 $ 23,002 ( 2%) $ 33,015 $ 36,772 (10%)
======== ======== ======== ========
</TABLE>
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<PAGE>
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
- 1996 Stock Option Plan, as amended
- Financial Data Schedule
(b) Reports on Form 8-K
No reports on Form 8-K were filed by the Company during
the Quarter for which this report is filed.
All other items hereunder are omitted because either such item is
inapplicable or the response to it is negative.
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.
STANHOME INC.
(Registrant)
Date: August 13, 1996 /s/G. William Seawright
_____________________________________
G. William Seawright
President and Chief Executive Officer
Date: August 13, 1996 /s/Allan G. Keirstead
_____________________________________
Allan G. Keirstead
Chief Administrative and Financial
Officer
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EXHIBIT INDEX
<TABLE>
<CAPTION>
Reg. S-K
Item 601 Exhibit 10-Q Page No.
_________ _______ _____________
<S> <C> <C>
10 1996 Stock Option Plan, as amended 21
and restated through June 4, 1996
27 Financial Data Schedule 28
</TABLE>
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STANHOME INC.
1996 Stock Option Plan, as amended
Through June 4, 1996
1. Purpose. The purpose of this 1996 Stock Option Plan (the "Plan")
is to advance the interests of Stanhome Inc. (the "Company") by encouraging
key management employees of the Company and its subsidiaries and non-
employee directors of the Company to acquire a proprietary interest in the
Company through ownership of common stock of the Company. Such ownership
will encourage the optionees to remain with the Company and will help
attract other qualified persons to become employees and directors.
2. Administration. The Plan shall be administered by the
Compensation and Stock Option Committee of the Board of Directors (the
"Committee") which shall be composed of not less than three directors of
the Company elected or to be elected as members of the Committee from time
to time by the Board of Directors of the Company. Each member of the
Committee shall be a "disinterested person" within the meaning of Rule 16b-
3 under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and an "outside director" within the meaning of Section 162(m) of
the Internal Revenue Code of 1986, as amended (the "Code"). Subject to the
provisions of the Plan and the approval of the Board of Directors of the
Company, except that the Board of Directors shall have no discretion with
respect to the selection of officers within the meaning of Rule 16a-1(f),
directors or 10% or more shareholders ("Insiders") for participation and
decisions concerning the timing, pricing and amount of a grant or award to
such "Insiders", the Committee is authorized to grant options under the
Plan and to interpret the Plan and such options, to prescribe, amend and
rescind rules and regulations relating to the Plan and the options, and to
make other determinations necessary or advisable for the administration of
the Plan, all of which determinations shall be conclusive. The Committee
shall act pursuant to a majority vote or by unanimous written consent.
3. Types of Options. Options granted pursuant to the Plan may be
either incentive stock options under Section 422 of the Code ("Incentive
Stock Options") or options not qualifying under that section of the Code
("Non-qualified Stock Options"). It is the intent of the Company that Non-
qualified Stock Options granted under the Plan not be classified as
Incentive Stock Options, that the Incentive Stock Options granted under the
Plan be consistent with and contain or be deemed to contain all provisions
required under Section 422 and the other appropriate provisions of the Code
and any implementing regulations (and any successor provisions thereof),
and that any ambiguities in construction shall be interpreted in order to
effectuate such intent.
4. Eligibility. Options shall be granted under the Plan to such
selected key full-time salaried and commissioned employees (including
officers and directors if they are employees) of the Company or any of its
subsidiaries as the Committee shall determine from time to time. Options
shall also be granted under the Plan to the non-employee directors of the
Company (the "Non-employee Directors") pursuant to Section 9 hereof.
5. Stock Subject to Options. The aggregate number of shares which
may be issued or sold under options granted pursuant to the Plan (the
"Shares") shall not exceed 1,500,000 shares of the Company's common stock
$0.125 par value each. Such Shares shall be either authorized but unissued
shares of said common stock or issued shares of said common stock which
shall have been reacquired by the Company. Such aggregate number of Shares
may be adjusted under Sections 9 and 10 below. If any outstanding option
under the Plan expires or is terminated for any reason, the Shares
allocated to the unexercised portion of such option may again be subjected
to an option or options under the Plan.
<PAGE>
6. Allotment of Shares. Except as provided under Section 9 hereof,
the Committee shall determine the total number of Shares to be offered to
each optionee under the Plan; provided, however, that no optionee may be
granted options which exceed 300,000 Shares under the Plan.
7. Option Price. The Shares shall be offered from time to time
under the Plan at a price which shall be not less than the greater of (i)
100 percent of the Fair Market Value of the Company's common stock on the
date the option is granted, or (ii) the par value of the Company's common
stock subject to the option; provided, however, that the price shall be not
less than 110 percent of such Fair Market Value in the case of Shares
offered under any Incentive Stock Option granted to an individual who, at
the time the option is granted, owns stock possessing more than 10 percent
of the total combined voting power of all classes of stock of the Company
or of its subsidiaries.
8. Terms and Conditions of Options. The Committee shall have power,
subject to the limitations contained in the Plan, to prescribe the terms
and conditions of any option granted hereunder. Each such option shall be
evidenced by a certificate in such form as the Committee shall from time to
time determine, which certificate shall prescribe the following terms and
conditions and such other terms and conditions as the Committee may deem
necessary or advisable:
(a) Duration of Options. Except as hereinafter otherwise provided,
options granted under the Plan shall be exercisable for such period of time
as the Committee shall determine. An Incentive Stock Option shall not be
exercisable after the expiration of ten years from the date it is granted;
provided, however, that any Incentive Stock Option granted to an individual
who, at the time the option is granted, owns stock possessing more than 10
percent of the total combined voting power of all classes of stock of the
Company or of its subsidiaries shall by its terms not be exercisable after
the expiration of five years from the date of grant.
(b) Exercise of Options. Except as hereinafter otherwise provided,
each option granted under the Plan may be exercised only after six months
of continued employment by the Company or one of its subsidiaries
immediately following the date the option is granted, or the date of
Stockholder approval under Section 11 below if later, and only during the
continuance of the optionee's employment with the Company or one of its
subsidiaries and such additional period as may be provided in subsection
(e) below. No option shall be exercised for less than 10 Shares except as
a result of an adjustment under Sections 9 or 10 below. Subject to the
foregoing and to the limitations set forth under subsection 8(e) below,
each option granted under the provisions of this Section 8 may be exercised
at any time after six months from the date the option is granted or, if
later, six months after the date of approval of the Plan by the
Stockholders of the Company,(1) as to 50% of the Shares subject to the
option if the Fair Market Value of the common stock is at or above 125% of
the Option Price on each of at least ten consecutive Trading Days, (2) as
to the remaining 50% of the Shares subject to the option if, at any time at
or after the initial 50% of said Shares becomes exercisable, the Fair
Market Value of the common stock is at or above 150% of the Option Price on
each of at least ten consecutive Trading Days, or (3) after the eighth
anniversary of the date the option is granted.
(c) Payment. The purchase price of each Share purchased upon the
exercise of any option granted hereunder shall be paid in full at the time
of such purchase, and a stock certificate representing Shares so purchased
shall be delivered to the person entitled thereto. Until the stock
certificate for such Shares is issued in the optionee's name, he or she
shall have none of the rights of a stockholder. Payment may be made in
whole or in part in (i) cash or (ii) whole shares of the Company's common
stock acquired at least six months previously by the optionee, for which
the optionee has good title, free and clear of all liens and encumbrances,
<PAGE>
and evidenced by negotiable certificates, valued at their Fair Market Value
on the date preceding the date the option is exercised. If certificates
representing shares of common stock are used to pay all or part of the
purchase price of an option, separate certificates shall be delivered by
the Company representing the same number of shares as each certificate so
used and an additional certificate shall be delivered representing the
additional shares to which the option holder is entitled as a result of
exercise of the option. It shall be a condition to the performance of the
Company's obligation to issue or transfer Shares upon exercise of an option
or options that the optionee pay, or make provision satisfactory to the
Company for the payment of, any taxes (other than stock transfer taxes)
which the Company is obligated to collect with respect to the issue or
transfer upon such exercise. With respect to the exercise of Non-qualified
Stock Options granted pursuant to this Section 8, optionees may elect to
have the Company withhold a designated number of Shares otherwise issuable
upon the exercise of such stock options, or, in the case of "Insider"
optionees, to commit irrevocably at a time acceptable under the provisions
of Section 16 of the Exchange Act to have the Company withhold whole shares
of common stock to cover Federal and State tax obligations incident to such
exercise, or such other maximum amounts as may be determined by the
Committee.
(d) Nontransferability of Options. No option shall be transferable
by the optionee otherwise than (1) by will or the laws of descent and
distribution or pursuant to beneficiary designation procedures approved by
the Committee, (2) as otherwise permitted under Rule 16b-3 under the
Exchange Act from time to time and allowed by the Committee, or (3)
pursuant to a qualified domestic relations order as defined in Section
414(p) of the Code. Except to the extent permitted by the foregoing
sentence, each option shall be exercisable, during his or her lifetime,
only by the optionee or his or her guardian or legal representative(s).
(e) Termination of Options. (i) Disability, Retirement at or after
age 55, Termination without Substantial Cause, or Death. If the optionee's
employment with the Company or any subsidiary terminates by reason of
Disability, retirement at or after age 55, termination by the Company or
any subsidiary without Substantial Cause, death, or for any other reason
not set forth under clauses (ii) and (iii) below, if not sooner terminated
pursuant to their terms and subject to subsections (a) and (b) above, all
outstanding options then held by the optionee shall be exercisable during
the three year period following any such termination of employment by the
optionee or his or her guardian or legal representative(s), except further
that in the case of Incentive Stock Options the period for such exercise
following such termination shall be limited to three months, or, in the
case of a termination of employment by reason of disability, to twelve
months; (ii) Termination by Voluntary Resignation or Retirement before
reaching age 55. If the optionee's employment with the Company or any
subsidiary is terminated either by voluntary resignation or retirement
before reaching age 55, all outstanding options then held by the optionee
shall be exercisable during the three month period following any such
termination of employment by the optionee or his or her guardian or legal
representative(s); (iii) Termination for Substantial Cause. If the
optionee's employment with the Company or any subsidiary is terminated for
Substantial Cause, all outstanding options then held by the optionee shall
thereupon be forfeited by the optionee and canceled by the Company; and
(iv) Termination within Six Months of Grant. Notwithstanding the
foregoing, upon the optionee's employment with the Company or any
subsidiary terminating at any time for any reason, all outstanding options
granted within the last six months prior to the optionee's termination
shall thereupon be forfeited by the optionee and canceled by the Company.
Cessation of any corporation's relationship with the Company as a
subsidiary shall constitute a "termination without Substantial Cause"
hereunder as to individuals employed by that corporation, and options held
by such individuals shall be terminated in accordance with paragraph (i)
<PAGE>
above. For purposes of this subsection, the meaning of the word
"disability" shall be determined under the provisions of Section 422(c)(7)
of the Code or any successor provisions thereof.
(f) Fair Market Value. Fair Market Value shall mean the closing
transaction price of a share of common stock as reported in the New York
Stock Exchange Composite Transactions on the date as of which such value is
being determined, or, if the common stock is not listed on the New York
Stock Exchange, the closing transaction price of a share of common stock on
the principal national stock exchange on which the common stock is traded
on the date as of which such value is being determined; or, if there shall
be no reported transaction for such date, on the next preceding date for
which a transaction was reported; provided, however, that if Fair Market
Value for any date cannot be so determined, Fair Market Value shall be
determined by the Committee by whatever means or method as the Committee,
in the good faith exercise of its sole discretion, shall at such time deem
appropriate.
(g) "Trading Day". A Trading Day shall be a day on which the
Company's common stock may be traded on a stock exchange or, if the
Company's common stock is not listed on any exchange, in the Over The
Counter market.
(h) "Substantial Cause". Substantial Cause shall mean (1) the
willful and continued failure by optionee to perform substantially the
optionee's duties with the Company or a subsidiary (other than any such
failure resulting from the optionee's incapacity due to physical or mental
illness) after a written demand for substantial performance is delivered to
the optionee by the Board, which demand specifically identifies the manner
in which the Board believes that the optionee has not substantially
performed the optionee's duties or (2) the willful engagement by the
optionee in conduct which is demonstrably and materially injurious to the
Company or its subsidiaries, monetarily or otherwise. For purposes of
clauses (1) and (2) of this definition, no act or failure to act by a
optionee shall be deemed "willful" unless done, or omitted to be done, by
the optionee not in good faith and without reasonable belief that the
optionee's act or failure to act was in the best interests of the Company.
9. Non-employee Directors' Options. The Committee shall not have
any discretion with respect to the options granted to the Non-employee
Directors under the provisions of this Section 9. Except as hereinafter
otherwise provided, options granted pursuant to this Section 9 shall be
subject to the terms and conditions set forth in Section 8.
(a) Grant of Options. On the day following each of the 1996 through
and including the 1998 annual stockholders' meetings, each person who is a
Non-employee Director immediately after such meeting shall automatically be
granted an option to purchase 1,500 Shares. The maximum number of Shares
for which options may be granted to any Non-employee Director under the
Plan shall be 4,500. All such options shall be Non-qualified Stock
Options. The price at which each Share covered by such options shall be
purchased shall be the greater of (i) 100 percent of the Fair Market Value
of the Company's common stock on the date the option is granted, or (ii)
the par value of the Company's common stock subject to the option.
(b) Exercise of Options. (i) Except as hereinafter otherwise
provided, an option granted to the Non-employee Director may be exercised
only after six months of continued service as a Director of the Company
following the date the option is granted, or the date of Stockholder
approval under Section 11 below if later, and only during the continuance
of the optionee serving on the Board of Directors and such additional
period as is provided for below. The option may be exercised by the Non-
employee Director or his or her guardian or legal representative(s) during
the period that the Non-employee Director remains a member of the Board of
Directors and for a period of three years thereafter, subject to subsection
<PAGE>
8(a) and the conditions of exercise set forth below in this subsection 9(b)
and, provided further, that in no event shall the option be exercisable
more than ten years after the date of grant. Subject to the foregoing,
each option granted to the Non-employee Directors under the provisions of
this Section 9 may be exercised at any time after six months from the date
the option is granted or, if later, six months after the date of approval
of the Plan by the Stockholders of the Company, (1) as to 50% of the Shares
subject to the option if the Fair Market Value of the common stock is at
or above 125% of the Option Price on each of at least ten consecutive
Trading Days, (2) as to the remaining 50% of the Shares subject to the
option if, at any time at or after the initial 50% of said Shares becomes
exercisable, the Fair Market Value of the common stock is at or above 150%
of the Option Price on each of at least ten consecutive Trading Days, or
(3) after the eighth anniversary of the date the option is granted; and
(ii) Notwithstanding the foregoing, upon the Non-employee Director's
service as a Director of the Company terminating at any time for any
reason, all outstanding options granted within the last six months prior to
the Non-employee Director's termination shall thereupon be forfeited by the
Non-employee Director and canceled by the Company.
(c) Payment. An option granted to the Non-employee Director shall
be exercisable only upon payment to the Company in accordance with the
provisions of Section 8(c) of the full purchase price of the Shares with
respect to which the option is being exercised.
(d) Adjustment of Options. In the event of a stock dividend, split-
up or combination of shares, recapitalization, reclassification or merger
in which the Company is the surviving corporation, or other similar capital
or corporate structure change, the number of Shares at the time of such
change remaining subject to any option granted or to be granted pursuant to
the provisions of this Section 9 shall be increased or decreased, as the
case may be, in direct proportion to the increase or decrease in the number
of shares of common stock of the Company by reason of such change in
corporate structure, provided that the number of Shares shall always be a
whole number with any fractional Shares being deleted therefrom, and the
purchase price per Share of any outstanding options shall, in the case of
an increase in the number of Shares, be proportionately decreased, and in
the case of a decrease in the number of Shares, be proportionately
increased. In the event of a consolidation or merger in which the Company
is not the surviving corporation or of a "Change in Control" as defined in
Section 10, including, but not limited to, "Changes in Control" in which
the Company is the surviving corporation, and notwithstanding the preceding
sentence, each option outstanding under the provisions of this Section 9
shall thereupon terminate, provided that within ten days of the effective
date of any such consolidation, merger, or "Change in Control", the Company
shall pay in cash the difference between the exercise price of the
unpurchased Shares under the options and the value of consideration
receivable in the transaction by a holder of the number of shares of common
stock equal to the number subject to the options.
10. Changes in Stock. In the event of a stock dividend, split-up or
combination of shares, recapitalization, reclassification or merger in
which the Company is the surviving corporation, or other similar capital or
corporate structure change, the number and kind of Shares at the time of
such change remaining subject to the Plan and to any option granted or to
be granted pursuant to the Plan, except for options granted or to be
granted pursuant to Section 9, the option price and any other relevant
provisions shall be appropriately adjusted by the Board of Directors of the
Company, whose determination shall be binding on all persons. In the event
of a consolidation or merger in which the Company is not the surviving
corporation, (i) each option outstanding hereunder that is held by an
"Insider" optionee and that is not outstanding under the provisions of
Section 9 shall become immediately exercisable and (ii) each option
outstanding hereunder that is held by an optionee who is not an "Insider"
shall terminate, provided that at least twenty days prior to the effective
<PAGE>
date of any such consolidation or merger, the Board of Directors of the
Company shall do one of the following with respect to options held by
optionees who are not "Insiders": (1) make such options immediately
exercisable, (2) arrange to have the surviving or consolidated corporation
grant replacement options to the optionees involved, or (3) pay in cash the
difference between the exercise price of the unpurchased Shares under the
options and the value of consideration receivable in the transaction by a
holder of the number of shares of common stock equal to the number subject
to the options. No adjustment provided for in this Section 10 shall
require the Company to issue or sell a fractional share under any option
hereunder and any fractional share resulting from any such adjustment shall
be deleted from the option involved.
Notwithstanding anything herein to the contrary, and without regard
to subsections 8(e)(iv) and 9(b)(ii) and clauses 1, 2 and 3 of subsections
8(b) and 9(b), in the event of a "Change in Control" as defined below,
including certain consolidation or merger events otherwise giving rise to
the adjustments or alternatives described in the above paragraph, each
option outstanding under this Plan shall thereupon terminate, provided that
within ten days of the effective date of such Change in Control, the
Company shall pay in cash the difference between the exercise price of the
unpurchased Shares under the options and the value of consideration
receivable in the transaction by a holder of the number of shares of common
stock equal to the number subject to the options. As used herein, "Change
in Control" means a Change in Control of a nature that would, in the
opinion of the Company counsel, be required to be reported in response to
Item 6(e) of Schedule 14A of Regulation 14A promulgated under the Exchange
Act; provided that, without limitation, such a Change in Control shall be
deemed to have occurred if: (i) any "Person" (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act (other than the Company or any
subsidiary of the Company, any trustee or fiduciary holding securities
under an employee benefit plan of the Company or any of its subsidiaries or
a corporation owned, directly or indirectly, by the stockholders of the
Company in substantially the same proportions as their ownership of the
stock of the Company)) becomes the "beneficial owner" (as defined in Rule
13d-3 of the Exchange Act), directly or indirectly, of securities of the
Company representing 25% or more of the combined voting power of the
Company's then outstanding securities; or (ii) during any period of two
consecutive years (not including any period prior to the effective date of
this Plan), individuals who at the beginning of such period constitute the
Board of Directors and any new director (other than a director designated
by a Person who has entered into an agreement with the Company to effect a
transaction described in clause (i), (iii), or (iv) of this paragraph)
whose election by the Board of Directors or nomination for election by the
Company's stockholders was approved by a vote of at least two-thirds (2/3)
of the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election was
previously so approved cease for any reason to constitute a majority
thereof; or (iii) the stockholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than (A) a
merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting
securities of the surviving entity), in combination with the ownership of
any trustee or other fiduciary holding securities under an employee benefit
plan of the Company, at least 75% of the combined voting power of the
voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation, or (B) a merger or
consolidation effected to implement a recapitalization of the Company (or
similar transaction) in which no Person acquires 25% or more of the
combined voting power of the Company's then outstanding securities; or (iv)
the stockholders of the Company approve a plan of complete liquidation of
the Company or an agreement for the sale or disposition by the Company of
all or substantially all the Company's assets.
<PAGE>
With respect to all optionees other than the Non-employee Directors,
no Change in Control shall be deemed to have occurred if the optionee is a
member of a management group which first announces a proposal which
constitutes a Potential Change in Control, unless otherwise determined by a
majority of the members of the Board of Directors who are not members of
such management group. A "Potential Change in Control" shall be deemed to
have occurred if the conditions set forth in any one of the following
subsections shall have been satisfied: (i) the Company enters into an
agreement, the consummation of which would result in the occurrence of a
Change in Control; (ii) the Company or any Person publicly announces an
intention to take or to consider taking actions, which if consummated,
would constitute a Change in Control; (iii) any Person who is or becomes
the beneficial owner, directly or indirectly, of securities of the Company
representing 10% or more of the combined voting power of the Company's then
outstanding securities, increases such Person's beneficial ownership of
such securities by 5% or more over the percentage so owned by such Person
on the date hereof; or (iv) the Board of Directors adopts a resolution to
the effect that, for purposes of this Plan, a Potential Change in Control
has occurred.
11. Effective Date; Stockholder Approval; Term. The Plan was
adopted by the Board of Directors on January 24, 1996 and shall become
effective as of January 24, 1996 if the Plan is approved by the holders of
a majority of the common stock outstanding and entitled to vote at the
Annual Meeting of Stockholders scheduled for April 25, 1996. No option
hereunder shall be granted after January 23, 2006 or the earlier suspension
or termination of the Plan in accordance with its terms. The Plan shall
terminate on January 23, 2006 or on such earlier date as it may be
suspended or terminated under the provisions of Section 12 below or as of
which all Shares subject to options authorized to be granted under the Plan
shall have been acquired by exercise of such options.
12. Amendment or Discontinuance of the Plan. The Board of Directors
of the Company may, insofar as permitted by law, at any time or from time
to time, suspend or terminate the Plan or revise or amend it in any respect
whatsoever except that, without appropriate approval of the stockholders of
the common stock, no such revision or amendment shall increase the maximum
number of Shares subject to the Plan, change the designation of the class
of employees eligible to receive options, decrease the price at which
options may be granted or otherwise change the provisions of this Plan to
the extent approval of the holders of the common stock of the Company is
required under applicable laws, rules or regulations. Notwithstanding the
preceding sentence, amendments to change the provisions of Section 9(a)
shall not be made more frequently than once every six months other than to
comply with the Code or the Employee Retirement Income Security Act.
13. Applicable Laws or Regulations and Notification of Disposition.
The Company's obligation to sell and deliver Shares under an option is
subject to such compliance as the Company deems necessary or advisable with
federal and state laws, rules and regulations applying to the
authorization, issuance, listing or sale of securities. The Company may
also require in connection with any exercise of an Incentive Stock Option
that the optionee agree to notify the Company when making any disposition
of the Shares, whether by sale, gift, or otherwise, within two years of the
date of grant or within one year of the date of exercise.
14. No Employment Right; No Obligation to Exercise Option. Nothing
contained in the Plan, or in any option granted under it, shall confer upon
any optionee any right to continued employment by the Company or any of its
subsidiaries or to continued membership on the Board of Directors of the
Company or limit in any way the right of the Company or any subsidiary to
terminate the optionee's employment at any time. The granting of any
option hereunder shall impose no obligation upon the optionee to exercise
such option.
<TABLE> <S> <C>
<ARTICLE> 5 EXHIBIT 27
<S> <C> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 20,477,816
<SECURITIES> 0
<RECEIVABLES> 218,324,469
<ALLOWANCES> 23,123,891
<INVENTORY> 120,726,325
<CURRENT-ASSETS> 381,723,632
<PP&E> 132,359,252
<DEPRECIATION> 73,494,942
<TOTAL-ASSETS> 574,424,754
<CURRENT-LIABILITIES> 291,157,426
<BONDS> 0
0
0
<COMMON> 3,153,530
<OTHER-SE> 254,617,351
<TOTAL-LIABILITY-AND-EQUITY> 574,424,754
<SALES> 400,763,899
<TOTAL-REVENUES> 400,763,899
<CGS> 173,188,356
<TOTAL-COSTS> 173,188,356
<OTHER-EXPENSES> 192,177,413
<LOSS-PROVISION> 2,383,294
<INTEREST-EXPENSE> 3,951,112
<INCOME-PRETAX> 27,480,787
<INCOME-TAX> 12,459,503
<INCOME-CONTINUING> 15,021,284
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 15,021,284
<EPS-PRIMARY> .82
<EPS-DILUTED> .82
</TABLE>
