See accompanying notes to consolidated financial statements.
ASSETS
| March 31,
2001
| December 31,
2000
|
| | | |
| Cash | $35,163 | $28,910 |
| Accounts receivable - net | 300,921 | 301,974 |
| Inventories | 297,128 | 274,323 |
| Prepaid expenses and deferred charges | 31,850
| 34,752
|
| Total current assets | 665,062
| 639,959
|
Property and equipment, net |
832,396
|
825,754
|
Goodwill |
291,617 |
297,898 |
| Intangible assets, deferred charges, and other assets | 126,748
| 125,032
|
| Total | 418,365
| 422,930
|
TOTAL ASSETS |
$1,915,823
|
$1,888,643
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
Current portion of long-term debt |
$202,054 |
$227,459 |
| Short-term borrowings | 4,994 | 7,353 |
| Accounts payable | 223,556 | 207,115 |
| Accrued salaries and wages | 31,614 | 43,661 |
| Accrued income and other taxes | 20,112
| 9,509
|
| Total current liabilities | 482,330 | 495,097 |
Long-term debt, less current portion |
449,881 |
437,952 |
| Deferred taxes | 106,200 | 103,621 |
| Other liabilities and deferred credits | 55,193
| 51,646
|
| Total liabilities | 1,093,604
| 1,088,316
|
Minority interest |
1,618
|
1,570
|
| Stockholders' equity: | | |
| Common stock issued and outstanding (61,175,883 and 60,972,802 shares) | 6,117 | 6,097 |
| Capital in excess of par value | 242,302 | 237,100 |
| Retained income | 870,990 | 854,506 |
| Other comprehensive loss | (49,717) | (49,855) |
| Common stock held in treasury at cost (8,370,388 and 8,370,388 shares) | (249,091)
| (249,091)
|
| Total stockholders' equity | 820,601
| 798,757
|
| | | |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $1,915,823
| $1,888,643
|
See accompanying notes to consolidated financial statements.
| | Three Months Ended
March 31,
|
| | 2001
| 2000
|
Cash flows from operating activities
| | |
| Net income | $29,687 | $29,643 |
| Non-cash items: | | |
| Depreciation and amortization | 31,947 | 26,402 |
| Minority interest in net income | 99 | 46 |
| Deferred income taxes, non-current portion | 2,338 | 655 |
| Losses of unconsolidated affiliated companies | 693 | 623 |
| Tax benefits related to stock incentive programs | 920 | (7) |
| Loss (gain) on sale of property and equipment | 46 | (11) |
| Changes in working capital, net of effects of acquisitions and dispositions | 1,915 | (1,322) |
| Net change in deferred charges and credits | (966)
| (5,854)
|
Net cash provided by operating activities |
66,679
|
50,175
|
Cash flows from investing activities
|
|
|
| Additions to property and equipment | (32,135) | (27,814) |
| Business acquisitions | (200) | (3,355) |
| Proceeds from sale of property and equipment | 968 | 195 |
| Other | (28)
| 1
|
Net cash used in investing activities |
(31,395)
|
(30,973)
|
Cash flows from financing activities
| | |
| Change in long-term debt excluding debt assumed in business acquisition | 12,234 | 22,946 |
| Change in short-term debt | (27,536) | (1,140) |
| Cash dividends paid | (13,203) | (12,870) |
| Common stock purchased for the treasury | | (25,065) |
| Stock incentive programs | (920)
| 7
|
Net cash used by financing activities |
(29,425)
|
(16,122)
|
Effect of exchange rates on cash |
394
|
(755)
|
Net increase in cash |
6,253
|
2,325
|
Cash balance at beginning of year |
28,910
|
18,187
|
Cash balance at end of period |
$35,163
|
$20,512
|
See accompanying notes to consolidated financial statements.
EXHIBIT 19 - FINANCIAL STATEMENTS - UNAUDITED
BEMIS COMPANY, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(dollars in thousands, except
per share amounts)
| Common
Stock
| Capital In
Excess Of
Par Value
| Retained
Earnings
| Accumulated
Other
Comprehensive
Income (Loss)
| Common
Stock Held
In Treasury
| Total
Stockholders'
Equity
|
| Balance at December 31, 1998 | $5,906 | $181,908 | $708,362 | $(6,116) | $(202,206) | $687,854 |
Net income for 1999 | | |
114,775 | | |
114,775 |
| Translation adjustment for 1999 | | | | (24,353) | | (24,353) |
Pension liability adjustment, net of $(536) tax benefit
| | | | (175)
| | (175)
|
| Total comprehensive income | | | | | | 90,247
|
| Cash dividends paid on common stock $.92 per share | | | (48,126) | | | (48,126) |
| Stock incentive programs and related tax effects | 4 | 49 | | | | 53 |
| Purchase of 122,599 shares of common stock |
|
|
|
| (4,133)
| (4,133)
|
Balance at December 31, 1999 |
5,910 |
181,957 |
775,011 |
(30,644) |
(206,339) |
725,895 |
Net income for 2000 | | |
130,602 | | |
130,602 |
| Translation adjustment for 2000 | | | | (19,178) | | (19,178) |
Pension liability adjustment, net of $(642) tax benefit
| | | | (33)
| | (33)
|
| Total comprehensive income | | | | | | 111,391
|
| Cash dividends paid on common stock $.96 per share | | | (51,107) | | | (51,107) |
| 1,730,952 shares of common stock issued in acquisition of minority interest | 173 | 54,676 | | | | 54,849 |
| Stock incentive programs and related tax effects | 14 | 467 | | | | 481 |
| Purchase of 1,460,900 shares of common stock |
|
|
|
| (42,752)
| (42,752)
|
Balance at December 31, 2000 |
6,097 |
237,100 |
854,506 |
(49,855) |
(249,091) |
798,757 |
Net income for first three months of 2001 | | |
29,687 | | |
29,687 |
Translation adjustment for the first three months of 2001
| | | | 138
| | 138
|
| Total comprehensive income* | | | | | | 29,825
|
| Cash dividends paid on common stock, $.25 per share | | | (13,203) | | | (13,203) |
| Stock incentive programs and related tax effects | 20
| 5,202
|
|
|
| 5,222
|
Balance at March 31, 2001 |
$6,117
|
$242,302
|
$870,990
|
$(49,717)
|
$(249,091)
|
$820,601
|
*Total comprehensive income for the first three months of 2000 was $27,374.
See accompanying notes to consolidated financial statements.
EXHIBIT 19 - - FINANCIAL STATEMENTS - UNAUDITED
BEMIS COMPANY, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1 - Basis of Presentation
The accompanying unaudited consolidated financial statements have been prepared by Bemis Company, Inc. (the Company) in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position and results of operations. It is management’s opinion, however, that all material adjustments (consisting of normal recurring accruals) have been made which are necessary for a fair financial statement presentation. The results for the interim period are not necessarily indicative of the results to be expected for the year.
During 2000, the Financial Accounting Standards Board (FASB) through its Emerging Issues Task Force (EITF) reached a consensus that amounts billed for shipping and handling should be included in revenue and costs incurred by the seller for shipping and handling should be classified as cost of products sold. Accordingly, net sales and cost of products sold have been restated. Previously, the Company had recorded both revenue and costs of shipping and handling in net sales.
For further information, refer to the consolidated financial statements and footnotes included in the Company’s annual report on Form 10-K for the year ended December 31, 2000.
Note 2. New Accounting Pronouncements
Effective January 1, 2001, the Company adopted Statement of Financial Accounting Standards (SFAS) No. 133, “Accounting for Derivative Instruments and Hedging Activities,” as amended by SFAS No. 138. This new accounting standard requires that all derivative instruments be recorded on the balance sheet at fair value and establishes criteria for designation and effectiveness of hedging relationships. The effect of adopting this standard was not material to the Company’s consolidated financial statements. Upon adoption, the Company recorded the immaterial impact as interest expense.
The Company enters into forward foreign currency exchange contracts to offset movements in certain foreign currency denominated receivables and payables. Forward foreign currency exchange contracts generally have maturities of less than nine months and relate primarily to major Western European currencies. Counterparties to the forward foreign currency exchange contracts are major financial institutions. Credit loss from counterparty nonperformance is not anticipated.
The Company has elected to not use hedge accounting for their current derivative instruments and, therefore, the gains or losses on the derivative instruments are recognized currently in earnings. This income statement impact for the quarter ended March 31, 2001, is immaterial.
Note 3 - Segments of Business
The Company’s business activities are organized around its two principal business segments, Flexible Packaging and Pressure Sensitive Materials. Both internal and external reporting conform to this organizational structure with no significant differences in accounting policies applied. The Company evaluates the performance of its segments and allocates resources to them based on operating profit, which is defined as profit before general corporate expense, interest expense, income taxes, and minority interest. A summary of the Company’s business activities reported by its two business segments follows:
| | For the Quarter Ended
March 31,
|
Business Segments (in millions)
| 2001
| 2000
|
| Net Sales to Unaffiliated Customers: | | |
| Flexible Packaging | $451.3 | $392.5 |
| Pressure Sensitive Materials | 126.5 | 120.6 |
Intersegment Sales: | | |
| Flexible Packaging | (0.4) | (0.4) |
| Pressure Sensitive Materials |
| (0.1)
|
| Total | $577.4
| $512.6
|
Operating Profit and Pretax Profit: | | |
| Flexible Packaging | $ 61.9 | $49.3 |
| Pressure Sensitive Materials | 4.4
| 11.4
|
| Total operating profit | 66.3 | 60.7 |
General corporate expenses | (7.3) | (7.2) |
| Interest expense | (10.7) | (5.7) |
| Minority interest in net income | (.1)
| (0.1)
|
| Income before income taxes | $48.2
| $47.7
|
Identifiable Assets: | | |
| Flexible Packaging | $1,498.9 | $1,204.8 |
| Pressure Sensitive Materials | 361.9
| 323.5
|
| Total identifiable assets | 1,860.8 | 1,528.3 |
| Corporate assets | 55.0
| 44.5
|
| Total | $1,915.8
| $1,572.8
|
Note 4 - Taxes Based On Income
The Company's 2001 effective tax rate of 38% differs from the federal statutory rate of 35% primarily due to state and local income taxes.
Note 5 - Inventories
The Company’s inventories are valued at the lower of cost, determined by the first-in, first-out (FIFO) method, or market. Inventories are summarized as follows:
(in thousands) | March 31,
2001
| December 31,
2000
|
| | | |
| Raw materials and supplies | $94,941 | $84,867 |
| Work in process and finished goods | 202,187
| 189,456
|
Total inventories |
$297,128
|
$274,323
|
Note 6 - Earnings Per Share Computations
| | Three Months Ended
March 31,
|
| | 2001
| 2000
|
| | | |
| Income available to common stockholders (numerator) | $29,687,000 | $29,643,000 |
| Weighted-average common shares outstanding (denominator) | 52,803,239 | 53,474,831 |
Basic earnings per share of common stock |
$0.56 |
$0.55 |
| Dilutive effects of stock option and stock awards, net of windfall tax benefits | 155,496 | 211,692 |
| Weighted-average common shares and common stock equivalents outstanding (denominator) | 52,958,735 | 53,686,523 |
Diluted earnings per share of common stock |
$0.56 |
$0.55 |
Certain options outstanding at March 31, 2001 and 2000, were not included in the computation of diluted earnings per share because they would not have had a dilutive effect (832,251 shares of common stock for the three months ended March 31, 2001; 880, 316 shares of common stock for the three months ended March 31, 2000).
