HILLENBRAND INDUSTRIES, INC. AND SUBSIDIARIES EXHIBIT 1
FINANCIAL STATEMENTS (Unaudited)
Consolidated Cash Flows
(In Thousands)
Nine Months Ended
08/27/94 08/28/93
Cash flows from operating activities:
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 48,909 $100,921
Adjustments to reconcile net income to net cash flows from
operating activities:
Depreciation and amortization. . . . . . . . . . . . . . . . . . . 70,640 73,066
Change in noncurrent deferred income taxes . . . . . . . . . . . . (9,442) (14,332)
Change in net working capital excluding cash, current debt,
acquisitions and litigation settlement. . . . . . . . . . . . . . (26,257) (16,538)
Accrued litigation settlement net of income taxes (Note) . . . . . 52,545 --
Change in insurance items:
Benefit reserves. . . . . . . . . . . . . . . . . . . . . . . . . 170,947 132,283
Unearned revenue. . . . . . . . . . . . . . . . . . . . . . . . . 66,630 58,352
Deferred acquisition costs. . . . . . . . . . . . . . . . . . . . (47,228) (36,160)
Investments, net. . . . . . . . . . . . . . . . . . . . . . . . . (187,556) (175,173)
Other, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . (19,248) 24,303
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Net cash flows from operating activities . . . . . . . . . . . . . . . 119,940 146,722
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Cash flows from investing activities:
Capital expenditures, net. . . . . . . . . . . . . . . . . . . . . . (83,654) (70,261)
Acquisition of businesses. . . . . . . . . . . . . . . . . . . . . . (37,589) (21,205)
Other investments. . . . . . . . . . . . . . . . . . . . . . . . . . (13,000) --
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Net cash flows from investing activities . . . . . . . . . . . . . . . (134,243) (91,466)
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Cash flows from financing activities:
Additions (reductions)to debt, net . . . . . . . . . . . . . . . . . 28,424 (24,078)
Payment of cash dividends. . . . . . . . . . . . . . . . . . . . . . (30,507) (24,120)
Treasury stock acquisitions. . . . . . . . . . . . . . . . . . . . . (12,646) (14,701)
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- 206
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Net cash flows from financing activities . . . . . . . . . . . . . . . (14,729) (62,693)
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Total cash flows . . . . . . . . . . . . . . . . . . . . . . . . . . . (29,032) (7,437)
Cash and cash equivalents:
At beginning of period. . . . . . . . . . . . . . . . . . . . . . . . 210,157 149,989
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At end of period. . . . . . . . . . . . . . . . . . . . . . . . . . . $181,125 $142,552
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NOTE TO FINANCIAL STATEMENTS - UNUSUAL CHARGE
On September 19, 1994, the Company settled a patent infringement suit brought
by Kinetic Concepts, Inc. against Support Systems International, Inc. and SSI
Medical Services, Inc., wholly owned subsidiaries of the Company, for a cash
payment of $84.8 million. The settlement resulted in an unusual charge to
operations of $84.8 million, or $52.5 million after taxes, in the third
quarter. Payment was made in the fourth quarter of 1994.
Consolidated Income
(In Thousands Except Per Share Data)
Three Months Ended Nine Months Ended
08/27/94 08/28/93 08/27/94 08/28/93
Net revenues . . . . . . . . . . . . . . . . . . . $377,815 $340,599 $1,137,926 $1,054,429
Cost of revenues . . . . . . . . . . . . . . . . . 207,197 179,229 610,193 551,172
Administrative, dist. and selling expenses . . . . 117,046 109,738 351,269 330,924
Unusual charge (Note). . . . . . . . . . . . . . . 84,750 -- 84,750 --
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Operating profit (loss). . . . . . . . . . . . . . (31,178) 51,632 91,714 172,333
Interest expense . . . . . . . . . . . . . . . . . (5,555) (4,979) (17,045) (15,860)
Other income, net. . . . . . . . . . . . . . . . . 1,514 1,913 4,108 5,561
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Income (loss) from continuing operations
before income taxes . . . . . . . . . . . . . . . (35,219) 48,566 78,777 162,034
Income taxes . . . . . . . . . . . . . . . . . . . (13,679) 19,790 29,868 62,891
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Income (loss) from continuing operations . . . . . (21,540) 28,776 48,909 99,143
Income from discontinued operations net of
income taxes. . . . . . . . . . . . . . . . . . . -- 1,199 -- 1,778
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Net income (loss). . . . . . . . . . . . . . . . . $(21,540) $ 29,975 $ 48,909 $ 100,921
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Earnings/common share:
Income (loss) from continuing operations . . . . . $ (.30) $ .41 $ .69 $ 1.39
Income from discontinued operations net of
income taxes. . . . . . . . . . . . . . . . . . . -- .01 -- .02
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Net income (loss)/common share . . . . . . . . . . $ (.30) $ .42 $ .69 $ 1.41
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Dividends/common share . . . . . . . . . . . . . . $ .1425 $ .1125 $ .4275 $ .3375
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Consolidated Balance Sheet
ASSETS (In Thousands)
08/27/94 11/27/93
Current assets:
Cash and cash equivalents. . . . . . . . . . . . . $ 181,125 $ 210,157
Trade receivables. . . . . . . . . . . . . . . . . 257,782 253,818
Inventories. . . . . . . . . . . . . . . . . . . . 108,597 90,900
Other. . . . . . . . . . . . . . . . . . . . . . . 18,684 19,151
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Total current assets. . . . . . . . . . . . . . . 566,188 574,026
Equipment leased to others, net. . . . . . . . . . . 71,857 58,405
Property, net. . . . . . . . . . . . . . . . . . . . 285,651 268,383
Other assets:
Intangible assets, net . . . . . . . . . . . . . . 182,517 138,384
Other assets . . . . . . . . . . . . . . . . . . . 39,333 19,116
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Total other assets. . . . . . . . . . . . . . . . 221,850 157,500
Insurance assets:
Investments. . . . . . . . . . . . . . . . . . . . 1,133,118 934,029
Deferred acquisition costs . . . . . . . . . . . . 265,031 217,803
Deferred income taxes. . . . . . . . . . . . . . . 42,118 33,649
Other. . . . . . . . . . . . . . . . . . . . . . . 28,782 26,952
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Total insurance assets. . . . . . . . . . . . . . 1,469,049 1,212,433
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Total assets . . . . . . . . . . . . . . . . . . . . $2,614,595 $2,270,747
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LIABILITIES (In Thousands)
08/27/94 11/27/93
Current liabilities:
Short-term debt. . . . . . . . . . . . . . . . . . $ 17,466 $ 12,708
Current portion of long-term debt. . . . . . . . . 254 77,318
Trade accounts payable . . . . . . . . . . . . . . 44,213 47,768
Accrued expenses (Note). . . . . . . . . . . . . . 195,503 152,234
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Total current liabilities . . . . . . . . . . . . 257,436 290,028
Other liabilities:
Long-term debt . . . . . . . . . . . . . . . . . . 215,418 107,887
Other long-term liabilities. . . . . . . . . . . . 83,035 72,780
Deferred income taxes. . . . . . . . . . . . . . . 19,660 20,633
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Total other liabilities . . . . . . . . . . . . . 318,113 201,300
Insurance liabilities:
Benefit reserves . . . . . . . . . . . . . . . . . 998,762 827,815
Unearned revenue . . . . . . . . . . . . . . . . . 359,216 292,586
General liabilities. . . . . . . . . . . . . . . . 16,895 19,086
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Total insurance liabilities . . . . . . . . . . . 1,374,873 1,139,487
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Total liabilities. . . . . . . . . . . . . . . . . . 1,950,422 1,630,815
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SHAREHOLDERS' EQUITY
Common stock . . . . . . . . . . . . . . . . . . . 4,442 4,442
Additional paid-in capital . . . . . . . . . . . . 11,593 3,900
Retained earnings. . . . . . . . . . . . . . . . . 798,325 779,923
Foreign currency translation adjustment. . . . . . 4,426 (1,643)
Treasury stock . . . . . . . . . . . . . . . . . . (154,613) (146,690)
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Total shareholders' equity. . . . . . . . . . . . 664,173 639,932
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Total liabilities and shareholders' equity . . . . . $2,614,595 $2,270,747
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