UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[ X ]/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarterly period ended: March 31,June 30, 1997
---------------------------
OR
[ ]/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission file number: 0-23804
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Simpson Manufacturing Co., Inc.
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(Exact name of registrant as specified in its charter)
California 94-3196943
------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4637 Chabot Drive, Suite 200, Pleasanton, CA 94588
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(Address of principal executive offices)
(Registrant's telephone number, including area code): (510)460-9912
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
----- -----
The number of shares of the Registrant's Common Stock outstanding as
of March 31,June 30, 1997: 11,456,71611,472,965
----------
PART I -- FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
SIMPSON MANUFACTURING CO., INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
March 31,June 30, December 31,
---------------------------------------------------------
(Unaudited)
1997 1996 1996
------------ ------------ ------------
ASSETS
ASSETS
Current assets
Cash and cash equivalents $ 3,812,2054,698,928 $ 6,191,48712,875,191 $ 19,815,297
Short-term investments - - 3,896,428
Trade accounts receivable, net 31,334,018 26,280,55039,701,166 30,521,398 20,930,490
Inventories 53,716,313 34,335,99053,373,606 34,823,846 42,247,777
Deferred income taxes 3,192,455 2,357,4553,923,455 2,493,455 2,919,455
Other current assets 1,528,651 1,361,9231,258,106 950,650 956,565
------------ ------------ ------------
Total current assets 93,583,642 70,527,405102,955,261 81,664,540 90,766,012
Net property, plant and equipment 35,335,825 26,233,56536,055,534 25,656,317 28,687,635
Investments 507,127 1,329,715557,331 1,355,336 1,382,578
Other noncurrent assets 3,141,989 1,824,9592,971,392 1,774,287 1,684,548
------------ ------------ ------------
Total assets $132,568,583 $ 99,915,644$142,539,518 $110,450,480 $122,520,773
============ ============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Notes Payable $ 280,89526,091 $ - $ -
Trade accounts payable 10,919,997 5,869,96811,033,264 8,408,694 10,063,828
Accrued liabilities 3,525,075 3,112,2784,855,687 3,426,457 4,137,648
Income taxes payable 3,381,161 951,3932,837,187 868,164 341,626
Accrued profit sharing trust contributions 3,142,402 2,626,2263,876,283 3,302,741 2,446,001
Accrued cash profit sharing and commissions 2,346,768 1,307,1253,866,504 3,012,877 2,292,057
Accrued workers' compensation 809,272 842,125809,272 809,272
------------ ------------ ------------
Total current liabilities 24,405,570 14,709,11527,304,288 19,828,205 20,090,432
Deferred income taxes and long-term liabilities 1,152,981 133,7831,027,037 100,783 133,333
------------ ------------ ------------
Total liabilities 25,558,551 14,842,89828,331,325 19,928,988 20,223,765
------------ ------------ ------------
Commitments and contingencies (Notes 5 and 6)
Shareholders' equity
Common stock 31,298,619 30,789,60731,551,350 30,993,676 31,233,648
Retained earnings 75,620,180 54,404,77282,641,173 59,572,621 70,862,906
Cumulative translation adjustment 91,233 (121,633)15,670 (44,805) 200,454
------------ ------------ ------------
Total shareholders' equity 107,010,032 85,072,746114,208,193 90,521,492 102,297,008
------------ ------------ ------------
Total liabilities and shareholders' equity $132,568,583 $ 99,915,644$142,539,518 $110,450,480 $122,520,773
============ ============ ============
The accompanying notes are an integral part of these
condensed consolidated financial statements.
SIMPSON MANUFACTURING CO., INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)(UNAUDITED)
Three Months Ended March 31,
----------------------------Six Months Ended
June 30, June 30,
1997 1996 1997 1996
------------ ------------ ------------ ------------
Net sales $ 51,927,22265,554,874 $ 43,457,44851,759,610 $117,482,096 $ 95,217,057
Cost of sales 32,608,564 28,355,99239,228,286 31,508,992 71,836,850 59,864,983
------------ ------------ ------------ ------------
Gross profit 19,318,658 15,101,45626,326,588 20,250,618 45,645,246 35,352,074
------------ ------------ ------------ ------------
Operating expenses:
Selling 5,208,264 4,510,0336,366,762 5,462,644 11,575,025 9,972,678
General and administrative 6,226,376 5,128,4468,077,667 6,225,481 14,304,043 11,353,926
------------ ------------ 11,434,640 9,638,479------------ ------------
14,444,429 11,688,125 25,879,068 21,326,604
------------ ------------ ------------ ------------
Income from operations 7,884,018 5,462,97711,882,159 8,562,493 19,766,178 14,025,470
Interest income (expense), net 160,256 53,527(18,166) 97,356 142,089 150,883
------------ ------------ ------------ ------------
Income before income taxes 8,044,274 5,516,50411,863,993 8,659,849 19,908,267 14,176,353
Provision for income taxes 3,287,000 2,254,0004,843,000 3,492,000 8,130,000 5,746,000
------------ ------------ ------------ ------------
Net income $ 4,757,2747,020,993 $ 3,262,5045,167,849 $ 11,778,267 $ 8,430,353
============ ============ ============ ============
Net income per common share $ 0.400.59 $ 0.280.44 $ 0.99 $ 0.72
============ ============ ============ ============
Weighted average shares outstanding 11,881,875 11,621,42911,901,328 11,747,506 11,892,487 11,691,673
============ ============ ============ ============
The accompanying notes are an integral part of these
condensed consolidated financial statements.
SIMPSON MANUFACTURING CO., INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three(UNAUDITED)
Six Months
Ended March 31,
----------------------------June 30,
1997 1996
------------ ------------
Cash flows from operating activities
Net income $ 4,757,27411,778,267 $ 3,262,504
------------ ------------8,430,353
Adjustments to reconcile net income to net cash
provided by operating activities:
Gain on sale of capital equipment (5,000) (20,397)(13,194) (15,827)
Depreciation and amortization 1,875,006 1,445,2413,817,462 2,875,084
Deferred income taxes and long-term liabilities (273,000) 350,000(1,129,944) 181,000
Equity in (income) lossesincome of affiliates (58,000) 16,000(110,000) (33,000)
Changes in operating assets and liabilities, net of
effects of acquisitions:
Trade accounts receivable (9,086,908) (5,609,415)(17,521,910) (9,807,467)
Inventories (5,397,833) 135,260(4,973,420) (371,546)
Other current assets (525,526) (127,310)(235,056) 283,963
Other noncurrent assets 257,531 (27,450)296,903 (40,430)
Trade accounts payable (264,230) (1,566,792)(275,372) 1,033,680
Accrued liabilities (1,477,517) (274,249)(165,525) 75,029
Accrued profit sharing trust contributions 696,401 626,4871,430,282 1,303,002
Accrued cash profit sharing and commissions 54,711 17,9811,574,447 1,723,733
Income taxes payable 3,081,975 1,703,2272,632,769 1,789,446
Accrued workers' compensation - (32,853)
------------ ------------
Total adjustments (11,122,390) (3,331,417)(14,672,558) (1,036,186)
------------ ------------
Net cash used inprovided by (used in) operating activities (6,365,116) (68,913)(2,894,291) 7,394,167
------------ ------------
Cash flows from investing activities
Capital expenditures (4,758,625) (1,067,445)(6,803,126) (1,858,062)
Proceeds from sale of equipment 5,000 29,84012,730 41,560
Proceeds from sale of short-term investments 3,995,333 -
Acquisitions, net of cash acquired and equity interest
already owned (9,183,110)(9,352,706) -
Equity investments - (11,637)
------------ ------------
Net cash used in investing activities (9,941,402) (1,049,242)(12,147,769) (1,828,139)
------------ ------------
Cash flows from financing activities
Issuance of debt 280,895 -
Repayment of debt -(254,804) (20,037)
Issuance of Company's common stock 22,531 373,891180,495 373,412
------------ ------------
Net cash provided by (used in) financing activities 303,426 353,854(74,309) 353,375
------------ ------------
Net decreaseincrease (decrease) in cash and cash equivalents (16,003,092) (764,301)(15,116,369) 5,919,403
Cash and cash equivalents at beginning of period 19,815,297 6,955,788
------------ ------------
Cash and cash equivalents at end of period $ 3,812,2054,698,928 $ 6,191,48712,875,191
============ ============
The accompanying notes are an integral part of these
condensed consolidated financial statements.
SIMPSON MANUFACTURING CO., INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
Interim Period Reporting
The accompanying unaudited interim condensed consolidated financial
statements have been prepared pursuant to the rules and regulations for
reporting on Form 10-Q. Accordingly, certain information and footnotes
required by generally accepted accounting principles have been condensed or
omitted. These interim statements should be read in conjunction with the
consolidated financial statements and the notes thereto included in Simpson
Manufacturing Co., Inc.'s (the "Company's") 1996 Annual Report on Form 10-K
(the "1996 Annual Report").
The unaudited quarterly condensed consolidated financial statements have
been prepared on the same basis as the audited annual consolidated
financial statements, and in the opinion of management, contain all
adjustments (consisting of only normal recurring adjustments) necessary to
present fairly the financial information set forth therein, in accordance
with generally accepted accounting principles. The year-end condensed
consolidated balance sheet data was derived from audited financial
statements, but does not include all disclosures required by generally
accepted accounting principles. The Company's quarterly results may be
subject to fluctuations. As a result, the Company believes the results of
operations for the interim periods are not necessarily indicative of the
results to be expected for any future period.
Net Income Per Common Share
Net income per common share is computed based upon the weighted average
number of common shares outstanding. Common equivalent shares, using the
treasury stock method, are included in the per-share calculations for all
periods since the effect of their inclusion is dilutive.
The number of shares used in computing primary and fully diluted net income
per common share did not differ materially for the three and six months
ended March
31,June 30, 1997 and 1996.
Newly Issued Accounting Standards
In February 1997, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 128, "Earnings Per
Share" and No. 129, "Disclosure of Information about Capital Structure."
SFAS No. 128 establishes standards for computing and presenting earnings
per share ("EPS"), replacing the presentation of primary EPS with a
presentation of basic EPS. SFAS No. 129 consolidates the existing
disclosure requirements regarding an entity's capital structure. SFAS No.
128 and 129 are effective for financial statements issued for periods
ending after December 15, 1997, and accordingly, management has not
determined the impacteffect, if any, on the Company's financial statements for
the quarterthree and six months ended March 31,June 30, 1997.
In June 1997, the FASB issued SFAS No. 130, "Reporting Comprehensive
Income", and SFAS No. 131, "Disclosures About Segments of an Enterprise and
Related Information." SFAS No. 130 established standards for reporting and
display of comprehensive income and its components. SFAS No. 131 specifies
revised guidelines for determining an entity's operating segments and the
type and level of financial information to be disclosed. SFAS No. 130 and
131 are effective for financial statements issued for periods beginning
after December 15, 1997, and accordingly, management has not determined the
effect, if any, on the Company's financial statements for the three and six
months ended June 30, 1997.
2. Trade Accounts Receivable
Trade accounts receivable consist of the following:
March 31,At June 30, At
----------------------------- December 31,
----------------------------
1997 1996 1996
------------ ------------ ------------
Trade accounts receivable $ 33,020,43741,721,912 $ 27,522,71632,029,660 $ 22,242,827
Allowance for doubtful accounts (1,386,684) (1,039,728)(1,505,868) (1,053,448) (1,108,950)
Allowance for sales discounts (299,735) (202,438)(514,878) (454,814) (203,387)
------------ ------------ ------------
$ 31,334,01839,701,166 $ 26,280,55030,521,398 $ 20,930,490
============ ============ ============
3. Inventories The components of inventories consist
of the following:
March 31,At June 30, At
----------------------------- December 31,
----------------------------
1997 1996 1996
------------ ------------ ------------
Raw materials $ 17,577,34317,426,108 $ 12,043,22312,206,175 $ 15,107,660
In-process products 4,431,115 3,716,7195,530,391 3,164,225 3,763,634
Finished products 31,707,855 18,576,04830,417,107 19,453,446 23,376,483
------------ ------------ ------------
$ 53,716,31353,373,606 $ 34,335,99034,823,846 $ 42,247,777
============ ============ ============
Approximately 90%91% of the Company's inventories are valued using the LIFO
(last-in, first-out) method. Because inventory determination under the LIFO
method is only made at the end of each year based on the inventory levels
and costs at that time, interim LIFO determinations must necessarily be
based on management's estimates of expected year-end inventory levels and
costs. Since future estimates of inventory levels and costs are subject to
change, interim financial results reflect the Company's most recent
estimate of the effect of inflation and are subject to final year-end LIFO
inventory amounts. At March 31,June 30, 1997 and 1996, and December 31, 1996, the
replacement value of LIFO inventories exceeded LIFO cost by approximately
$1,186,000, $3,793,000$886,000, $3,077,000 and $1,186,000, respectively.
4. Net Property, Plant and Equipment
Net property, plant and equipment consists of the following:
March 31,At June 30, At
----------------------------- December 31,
----------------------------
1997 1996 1996
------------ ------------ ------------
Land $ 2,440,682 $ 2,065,682 $ 2,065,682
Buildings and site improvements 12,584,599 10,382,03912,652,353 10,382,076 10,379,901
Leasehold improvements 2,953,492 2,859,0532,909,671 2,859,204 2,869,612
Machinery and equipment 49,633,900 40,806,55853,188,221 42,271,683 46,311,624
------------ ------------ ------------
67,612,673 56,113,33271,190,927 57,578,645 61,626,819
Less accumulated depreciation
and amortization (37,646,354) (31,546,682)(39,480,105) (32,866,366) (35,916,354)
------------ ------------ ------------
29,966,319 24,566,65031,710,822 24,712,279 25,710,465
Capital projects in progress 5,369,506 1,666,9154,344,712 944,038 2,977,170
------------ ------------ ------------
$ 35,335,82536,055,534 $ 26,233,56525,656,317 $ 28,687,635
============ ============ ============
5. Debt The outstanding debt at March 31,June 30, 1997 and 1996, and the available
credit at March 31,June 30, 1997, consisted of the following:
Available Debt Outstanding
Credit at at March 31,
March 31, ----------------------------June 30,
June 30, -----------------------------
1997 1997 1996
------------ ------------ ------------
Revolving line of credit, interest
at bank's reference rate (at March 31,June
30, 1997, the bank's reference
rate was 8.50%), expires June 19971998 $ 12,931,75313,537,128 $ - $ -
Revolving line of credit, interest
at bank's prime rate (at March 31,June 30,
1997, the bank's prime rate was
8.50%), expires June 1997 4,783,7151998 4,937,129 - -
Revolving term commitment, interest
at bank's prime rate (at March 31,June 30,
1997, the bank's prime rate was
8.50%), expires June 19971998 4,000,000 - -
Revolving linesline of credit, interest
rate at the bank's base rate of
interest plus 2%, expires June 1997 410,8751998 416,075 - -
Standby letter of credit facilities 1,284,533525,744 - -
Other notes payable - 280,89526,091 -
------------ ------------ ------------
Total credit facilities $ 23,410,87623,416,076 $ 280,89526,091 $ -
============ ============
Standby letters of credit issued
and outstanding (1,284,533)(525,744)
------------
Total credit available $ 22,126,34322,890,332
============
The Company has threetwo outstanding standby letters of credit. Two of theseThese letters of
credit, in the aggregate amount of $832,570,$525,744, are used to support the
Company's self-insured workers' compensation insurance requirements
while the other, in the amount of $451,963, is used to support the working
capital needs of its European operations.requirements. Other
notes payable represent debt associated with foreign businesses acquired during the quarter.in
March 1997.
6. Commitments and Contingencies
Note 10 to the consolidated financial statements in the Company's 1996
Annual Report provides information concerning commitments and contingencies
relating to pending or possible claims, legal actions and proceedings
against the Company and its subsidiaries. Management believes that the
final resolution of these matters, individually or in the aggregate, is not
expected to have a material adverse effect on the financial position of the
Company.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
The following is a discussion and analysis of the consolidated financial
condition and results of operations for the Company for the three and six
months ended March 31,June 30, 1997 and 1996. The following should be read in
conjunction with the interim Condensed Consolidated Financial Statements
and related Notes appearing elsewhere herein.
Results of Operations for the Three Months Ended March 31,RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED JUNE 30, 1997, Compared
with the Three Months Ended March 31,COMPARED
WITH THE THREE MONTHS ENDED JUNE 30, 1996
Net sales increased 19.5%26.7% from the firstsecond quarter of 1996 to the firstsecond
quarter of 1997. The increase reflected growth throughout the United
States, with above average increases in the Northeast andparticularly in California. In addition, approximately 4% of the
sales for the quarter resulted from the acquisitions in March 1997 of
Patrick Bellion, S.A., of France ("Bellion"), and the Isometric Group, of
Canada ("Isometric"). Simpson Strong-Tie's firstsecond quarter sales increased
23.3%27.9% over the same quarter last year while Simpson Dura-Vent's sales
increased 7.4%21.7%. HomecentersContractor distributors and contractor distributorshomecenters were the fastest
growing connector sales channels, while dealer distributor sales increased
but at a slower rate than overall sales during the quarter. The growth rate
of Simpson Strong-Tie's engineered wood, seismic and epoxy product sales
remained strong, while Simpson Dura-Vent sales of Direct-Vent products,
sold both to OEMs and through distributors, continued to experience strong
growth.
Income from operations increased 44.3%38.8% from $5,462,977$8,562,493 in the firstsecond
quarter of 1996 to $7,884,018$11,882,159 in the firstsecond quarter of 1997. This increase
was primarily due to higher gross margins that resulted from lower laboroverhead
costs as a percentage of sales, despite an increase in depreciation and
facility charges which resulted principally from expansion during 1996. The
increase in gross margins was offset somewhat by the lower margins at the
recently acquired businesses. Selling expenses increased 16.6% from
$5,462,644 in the second quarter of 1996 to $6,366,762 in the second
quarter of 1997, but decreased somewhat as a percentage of sales. The
increase was primarily due to higher promotional expenses associated with
the retail business and an increase in the number of salespeople. General
and administrative expenses increased 29.8% from $6,225,481 in the second
quarter of 1996 to $8,077,667 in the second quarter of 1997. The increase
in selling, general and administrative expenses was primarily due to
increased cash profit sharing, as a result of higher operating profit, as
well as additional administrative costs associated with the two
acquisitions earlier in the year. The effective tax rate was 40.8% in the
second quarter of 1997, consistent with the first quarter of 1997.
RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED JUNE 30, 1997, COMPARED
WITH THE SIX MONTHS ENDED JUNE 30, 1996
Net sales increased 23.4% from the first half of 1996 to the first half of
1997. The increase reflected growth throughout the United States. The
largest percentage increase was in the Northeastern region of the country;
California showed the next largest percentage increase and the largest
dollar increase in sales. Simpson Strong-Tie's sales for the first half of
1997 increased 25.9% over the same period last year while Simpson Dura-
Vent's sales increased 14.5%. Homecenters and contractor distributors were
the fastest growing connector sales channels. The growth rate of Simpson
Strong-Tie's engineered wood, seismic and epoxy product sales remained
strong, while Simpson Dura-Vent sales of Direct-Vent products, sold both to
OEMs and through distributors, continued to experience above average
growth.
Income from operations increased 40.9% from $14,025,470 in the first six
months of 1996 to $19,766,178 in the first six months of 1997. This
increase was primarily due to higher gross margins that resulted from lower
overhead costs as a percentage of sales, despite an increase in
depreciation charges which resulted principally from equipment purchased
during 1996. Selling general and administrative expenses increased 16.1% from $9,638,479$9,972,678 in the first
quarterhalf of 1996 to $11,434,640$11,575,025 in the first quarterhalf of 1997, but decreased
slightly as a percentage of sales. As was the case in the second quarter,
the increase was primarily due to higher promotional expenses and an
increase in the number of salespeople. General and administrative expenses
increased 26.0% from $11,353,926 in the first half of 1996 to $14,304,043
in the first half of 1997. The increase in selling, general and
administrative expenses was primarily due to increased cash profit sharing,
as a result of higher operating profit. The effective
tax rate remained constant at 40.9% inprofit, as well as additional
administrative costs associated with the first quarter of 1997.
On March 11, 1997, a subsidiary of the Company completed the purchase of
three Canadian companies and a related U.S. company, known as the Isometric
Group, which manufacture and distribute a line of mechanical anchors and
other related products. The acquisition price was approximately $7.3
million in cash plus an earnout based on future sales increases. Also on
March 11, 1997, another of the Company's subsidiaries completed the
purchase, for approximately $1.7 million in cash, of the remaining 66% of
the equity of Patrick Bellion, S.A. ("Bellion"), a French manufacturer of
connector products. Bellion is now a wholly-owned subsidiary of the
Company. These two acquisitions extend the Company's products and
distribution in North America and continental Europe.March 1997.
Liquidity and Sources of CapitalLIQUIDITY AND SOURCES OF CAPITAL
As of March 31,June 30, 1997, working capital was $69.2$75.7 million as compared to $55.8$61.8
million at March 31,June 30, 1996, and $70.7 million at December 31, 1996. The
principal components of the decreaseincrease in working capital from December 31,
1996, were increases in the Company's trade accounts receivable and
inventory balances totaling nearly $29.9 million as a result of higher
sales levels and seasonal buying programs. In addition, the increase in
these balances were also affected by the purchases of Bellion and Isometric
in March of 1997. This increase was offset somewhat by decreases in cash
and cash equivalents and short-term investments which, in the aggregate,
decreased a total of $19.9$19.0 million, a large portion of which was used in
the two acquisitions and to purchase the Isometric Group, Bellion and capital equipment. In addition, income taxes payable increased approximately $3.0
million. These decreases were offset by increasesFurther offsetting
the increase in the Company's trade accounts receivable and inventory balances totaling nearly $21.9were increases in
income taxes payable, accrued cash profit sharing and commissions and
accrued contributions to the Company's profit sharing trust of
approximately $2.5 million, as
a result$1.6 million and $1.4 million, respectively.
The balance of the two acquisitions, higher sales levelschange in working capital was due to the fluctuation of
various other asset and seasonal buying
programs.liability accounts, including trade accounts
payable and deferred taxes. Without giving effect to the two acquisitions,
which are included in investing activities, the decrease in working capital was partially
offset bychange
combined with higher net income and noncash expenses, such as depreciation
and amortization, totaling approximately $6.6$15.6 million, and resulted in a net
use of cash of $6.4$2.9 million. As of March 31,June 30, 1997, the Company had unused
credit facilities available of approximately $22.1$22.9 million.
The Company used $9.9$12.1 million in its investing activities, primarily to
complete the two acquisitions and to purchase capital equipment. The
Company has made $4.8$6.8 million in capital equipment purchases in the first
quarterhalf of 1997 to expand its capacity. The Company plans to continue this
expansion in 1997.throughout the remainder of the year. Partially offsetting these
expenditures, the Company sold its short-term investments, which matured in
March, for approximately $4.0 million.
The Company believes that cash generated by operations and borrowings
available under its existing credit agreements will be sufficient for the
Company's working capital needs and planned capital expenditures through
the remainder of 1997. Depending on the Company's future growth, it may
become necessary to secure additional sources of financing.
PART II -- OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
The Company is involved in various legal proceedings and other matters
arising in the normal course of business. In the opinion of management,
none of such matters when ultimately resolved will have a material adverse
effect on the Company's financial position or results of operations.
ITEM 2. CHANGES IN SECURITIES.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.The Annual Meeting of Shareholders ("Annual Meeting") was held on May 15,
1997. The following seven nominees were reelected as director by the votes
indicated:
Total Votes
Total Votes Withheld
For Each From Each
Name Director Director
- ------------------------ ------------ ------------
Earl F. Cheit 10,952,557 16,686
Thomas J Fitzmyers 10,952,957 16,286
Stephen B. Lamson 10,952,657 16,586
Alan R. McKay 10,953,257 15,986
Sunne Wright McPeak 10,949,957 19,286
Barclay Simpson 10,951,136 18,107
Barry Lawson Williams 10,950,457 18,786
The following proposals were also adopted at the Annual Meeting by the vote
indicated:
Broker
Proposal For Against Abstain Non-Vote
- ------------------------------------ ------------ ------------ ------------ ------------
To increase by 300,000 shares (from
1,200,000 to 1,500,000) the number
of shares of Common Stock reserved
for issuance under the Simpson
Manufacturing Co., Inc. 1994 Stock
Option Plan 10,343,141 591,917 34,185 -
To ratify the appointment of Coopers
& Lybrand L.L.P. as independent
auditors of the Company for 1997 10,935,035 1,157 33,051 -
ITEM 5. OTHER INFORMATION.
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
a. Exhibits.
EXHIBIT
NO DESCRIPTION
------- --------------------------------------------------------------------------------------------------------------
10.1 Application for Amendment to Letter of Credit, dated
May 19, 1997, between Simpson Manufacturing Co.,
Inc. and Wells Fargo HSBC Trade Bank, N.A.
10.2 Credit Agreement, dated June 20, 1997, between
Barclays Bank PLC and Simpson Strong-Tie
International, Inc.
10.3 Tri-Party Agreement, First Amendment to Lease and
Purchase and Sale Agreement, dated July 25, 1997,
between Vacaville Investors, Simpson Manufacturing
Co., Inc. and Simpson Dura-Vent Company, Inc.
11 Statements re computation of earnings per share
27 Financial DateData Schedule, which is submitted
electronically to the Securities and Exchange
Commission for information only and not filed.
b. Reports on Form 8-K
ReportNo reports on Form 8-K dated January 7, 1997, reporting under Item 5were filed during the purchase by Simpson Strong-Tie International, Inc. of the assets of
the Builders Products Division of MiTek Industries Ltd. ("MiTek") and
the signing of a separate supply agreement with MiTek.
Report on Form 8-K dated March 21, 1997, reporting under Item 5 the
purchase by Simpson Strong-Tie Canada, Limited of the Isometric Group
and the purchase by Simpson Strong-Tie France, Limited of Patrick
Bellion, S.A.quarter for which
this report is filed.
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.
Simpson Manufacturing Co., Inc.
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(Registrant)
DATE: May 14,August 13, 1997 By: /s/Stephen B. Lamson
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Stephen B. Lamson
Chief Financial Officer