<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 THE QUARTERLY PERIOD ENDED MARCH 31, 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 1-6615
SUPERIOR INDUSTRIES INTERNATIONAL, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
CALIFORNIA 95-2594729
------------------------------ -----------------
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
7800 WOODLEY AVENUE
VAN NUYS, CALIFORNIA 91406
- ---------------------------------------- -----------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
(818) 781-4973
--------------
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
NOT APPLICABLE
(FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR,
IF CHANGE 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 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 LAST PRACTICABLE DATE.
<TABLE>
<CAPTION>
OUTSTANDING AT
CLASS OF COMMON STOCK MAY 2, 1995
--------------------- ---------------
<S> <C>
$.50 PAR VALUE 29,622,724
</TABLE>
-1-
<PAGE> 2
PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
---------------------------------------
SUPERIOR INDUSTRIES INTERNATIONAL, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited)
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1995 1994
--------- ------------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and equivalents $ 3,501 $ 5,884
Marketable securities, at the
lower of cost or market 14,927 21,158
Receivables, net 105,687 81,323
Inventories
Raw materials 15,253 18,210
Work in process 10,884 8,965
Finished goods 22,010 17,571
-------- --------
48,147 44,746
Other current assets 7,683 7,660
-------- --------
Total current assets 179,945 160,771
-------- --------
PROPERTY, PLANT AND EQUIPMENT, net 186,585 185,853
OTHER ASSETS 10,517 11,059
-------- --------
$377,047 $357,683
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes payable and current portion
of long-term debt $ 34,065 $ 39,201
Accounts payable 53,666 46,135
Accrued liabilities 20,609 20,008
Income taxes payable 4,093 1,579
-------- --------
Total current liabilities 112,433 106,923
-------- --------
LONG-TERM DEBT, net 23,024 23,075
OTHER LONG-TERM LIABILITIES 16,788 16,897
DEFERRED INCOME TAXES 10,606 10,606
SHAREHOLDERS' EQUITY 214,196 200,182
-------- --------
$377,047 $357,683
======== ========
</TABLE>
See notes to consolidated condensed financial statements.
-2-
<PAGE> 3
SUPERIOR INDUSTRIES INTERNATIONAL, INC.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(Unaudited)
(DOLLARS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1995 1994
----------- -----------
<S> <C> <C>
NET SALES $ 134,360 $ 105,938
Cost of Sales 102,941 81,364
----------- -----------
Gross Profit 31,419 24,574
Selling, general and administrative
expenses 5,121 4,214
----------- -----------
INCOME FROM OPERATIONS 26,298 20,360
Other Income (Expense):
Interest expense (598) (678)
Miscellaneous, net (369) 504
----------- -----------
(967) (174)
----------- -----------
INCOME BEFORE INCOME TAXES 25,331 20,186
Income Taxes 9,606 7,671
----------- -----------
NET INCOME $ 15,725 $ 12,515
=========== ===========
EARNINGS PER SHARE $ 0.53 $ 0.41
=========== ===========
Weighted Average and Equivalent
Shares Outstanding 29,914,000 30,828,000
=========== ===========
</TABLE>
See notes to consolidated condensed financial statements.
-3-
<PAGE> 4
SUPERIOR INDUSTRIES INTERNATIONAL, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1995 1994
-------- --------
<S> <C> <C>
NET CASH PROVIDED BY OPERATING ACTIVITIES $ 5,127 $ 17,863
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments of short-term borrowings (4,567) -
Stock options exercised 235 1,097
Payments of long-term debt (620) (44)
Cash dividends (1,332) (901)
Repurchases of common stock (754) (2,201)
-------- --------
NET CASH USED IN FINANCING ACTIVITIES (7,038) (2,049)
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property, plant and
equipment, net (7,844) (18,029)
Purchases of marketable securities - (19,775)
Proceeds from sales of marketable
securities 7,372 20,010
-------- --------
NET CASH USED IN INVESTING ACTIVITIES (472) (17,794)
-------- --------
Net Decrease in Cash and Equivalents (2,383) (1,980)
Cash and Equivalents at Beginning of Period 5,884 8,274
-------- --------
Cash and Equivalents at End of Period $ 3,501 $ 6,294
======== ========
</TABLE>
See notes to consolidated condensed financial statements.
-4-
<PAGE> 5
SUPERIOR INDUSTRIES INTERNATIONAL, INC.
CONSOLIDATED CONDENSED STATEMENTS OF SHAREHOLDERS' EQUITY
(Unaudited)
(DOLLARS IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Valuation
Adjustment
Common Stock to
---------------------- Additional Cumulative Marketable
Number of Paid-In Translation Securities Retained
Shares Amount Capital Adjustment Portfolio Earnings Total
---------- --------- ---------- ----------- ---------- --------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Balances at
December 31, 1994 29,611,635 $14,806 $55,555 $(10,572) $(2,500) $142,893 $200,182
Net income - - - - - 15,725 15,725
Foreign Currency
translation, including
related tax benefit - - - (660) - - (660)
Cash dividends
($.045/share) - - - - - (1,332) (1,332)
Repurchases of common stock (29,500) (15) (739) - - - (754)
Stock options exercised,
including related tax
benefit 17,839 9 226 - - - 235
Valuation adjustment to
marketable securities
portfolio - - - - 800 - 800
---------- ------- ------- -------- ------- -------- --------
Balances at
March 31, 1995 29,599,974 $14,800 $55,042 $(11,232) $(1,700) $157,286 $214,196
========== ======= ======= ======== ======= ======== ========
</TABLE>
See notes to consolidated condensed financial statements.
-5-
<PAGE> 6
SUPERIOR INDUSTRIES INTERNATIONAL, INC.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Unaudited)
1. During interim periods, the Company follows the
accounting policies set forth in its Annual Report
to Stockholders and applies appropriate interim financial
reporting standards, including the use of estimated
annual effective tax rates. Users of financial information
produced for interim periods are encouraged to refer to the
notes contained in the Annual Report to Stockholders when reviewing
interim financial results.
In the opinion of Management, the accompanying
unaudited consolidated condensed financial statements
of Superior Industries International, Inc. and subsidiaries
(the "Company") contain all the adjustments necessary to present fairly
the financial position of the Company as of March 31, 1995, and 1994,
and the results of its operations and cash flows for the three
months ended March 31, 1995 and 1994.
2. Per share amounts are based on the weighted average
number of shares of common stock outstanding and common stock
equivalents, when dilutive, during the period.
3. Interest paid, net of amounts capitalized, was
$257,000 and taxes paid was $1,073,000, for the three months ended
March 31, 1995.
-6-
<PAGE> 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Summary of Net Sales by Product Line
(000's)
<TABLE>
<CAPTION>
Increase
For The Three Months Ended March 31, 1995 1994 Over 1994
------------------------------------ ---------- ---------- ---------
<S> <C> <C> <C>
OEM Cast Aluminum Road Wheels $ 124,543 $ 97,779 27.4%
Aftermarket 9,817 8,159 20.3%
---------- ----------
$ 134,360 $ 105,938 26.8%
========== ==========
</TABLE>
Results of Operations
Net sales for the quarter ended March 31, 1995 were $134.4 million
compared with $105.9 million in 1994. This $28.4 million, or 26.8%
increase in net sales resulted, primarily from the adjustment of the
aluminum content of selling prices to reflect current market
conditions, as well as increases in both OEM and aftermarket roadwheel
shipments. Unit shipments of OEM cast aluminum wheels increased 4.7%
over the comparable period in 1994 and were generally equivalent to
the overall increase in North American auto production.
Net sales in the aftermarket business increased 20.3% over 1994 to
$9.8 million, representing the continued success of the Company's
"Streetwear" product line of aluminum and chrome-plated aluminum
wheels, and favorable customer response to several new styles of
aftermarket wheels.
Gross profit was 23.4% of net sales in the first quarter of 1995
compared to 24.2% in 1994, after factoring out the $1.1 million impact
of the January 17, 1994 Northridge, California earthquake. Lower
gross profit margin percentages reflect the impact that higher
aluminum costs bear on selling prices, but which do not impact the
Company's profitability in absolute dollars. The negative impact of
higher aluminum costs on gross profit percentages more than offset the
operating efficiencies achieved during the first quarter.
Selling, general and administrative expenses, measured as a percentage
of net sales, decreased to 3.8% for the first quarter versus 4.0% in
the comparable quarter of 1994 and increased $907,000 in absolute
dollars. The increase in absolute dollars is a result of the
additional resources required to manage the Company's expanding range
of business activities.
-7-
<PAGE> 8
Reduced interest expense reflects $453,000 of capitalized interest
recognized in 1995 related to construction of the Fayetteville,
Arkansas chrome-plating facility verses $267,000 of capitalized
interest recognized for the Chihuahua, Mexico OEM plant construction
in 1994. Partially offsetting this reduction to interest expense was
higher interest relating to greater short-term borrowings required to
manage the increased working capital requirements.
Miscellaneous, net decreased $873,000 as the Company incurred $600,000
of pre-production costs for the new chrome-plating facility.
Additionally, lower levels of interest income were realized relative
to the prior year as the Company liquidated short-term investments to
fund extensive plant expansion activities over the past year.
Liquidity and Capital Resources
Net cash provided by operating activities was $5.1 million in the
first quarter of 1995 versus $17.9 million for the comparable period
in 1994. Supplementing cash flows were the liquidation of $7.4
million in marketable securities. Lower levels of cash provided by
operations were primarily caused by the build-up of receivables and
inventories, offset somewhat by the timing of payments on trade
payables. Cash was utilized to fund $7.8 million of capital
expenditures for the Fayetteville chrome-plating facility, the
Chihuahua, Mexico second phase plant expansion and on-going facility
enhancements. Additionally, cash was utilized to reduce outstanding
lines of credit.
Working capital and current ratio were $67.5 million and 1.6:1 versus
$53.8 million and 1.5:1 at March 31, 1995 and December 31, 1994,
respectively. The long-term debt to total capitalization ratio
improved to 9.7% at the end of the first quarter versus 10.3% at the
end of 1994.
-8-
<PAGE> 9
PART II OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits - Exhibit-27, Financial Data Schedule
(b) Reports on Form 8-K - There were no reports filed during the
quarter ended March 31, 1995.
(This space intentionally left blank.)
-9-
<PAGE> 10
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.
SUPERIOR INDUSTRIES INTERNATIONAL, INC.
(Registrant)
Date 05/12/95 /s/ Louis L. Borick
-----------------------------------
Louis L. Borick
President and Chairman of the Board
Date 05/12/95 /s/ R. Jeffrey Ornstein
-----------------------------------
R. Jeffrey Ornstein
Vice President and CFO
-10-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET AS OF MARCH 31, 1995 AND THE
UNAUDITED CONDENSED STATEMENT OF OPERATIONS FOR THE THREE MONTHS THEN ENDED.
THIS SCHEDULE IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH UNAUDITED
CONDENSED FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1995
<CASH> 3,501
<SECURITIES> 14,927
<RECEIVABLES> 85,063
<ALLOWANCES> 518
<INVENTORY> 48,147
<CURRENT-ASSETS> 179,945
<PP&E> 299,713
<DEPRECIATION> 113,128
<TOTAL-ASSETS> 377,047
<CURRENT-LIABILITIES> 112,433
<BONDS> 3,372
<COMMON> 14,800
0
0
<OTHER-SE> 199,396
<TOTAL-LIABILITY-AND-EQUITY> 377,047
<SALES> 134,360
<TOTAL-REVENUES> 134,747
<CGS> 102,941
<TOTAL-COSTS> 108,062
<OTHER-EXPENSES> 756<F1>
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 598
<INCOME-PRETAX> 25,331
<INCOME-TAX> 9,606
<INCOME-CONTINUING> 15,725
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 15,725
<EPS-PRIMARY> 0.53
<EPS-DILUTED> 0
<FN>
<F1>OTHER EXPENSES INCLUDE MISCELLANEOUS EXPENSE.
</FN>
</TABLE>
