SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 10-K/A
(Mark One)
(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended June 30, 1994
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
Commission File Number 0-12954
CADMUS COMMUNICATIONS CORPORATION
(Exact Name of Registrant as specified in its charter)
VIRGINIA 54-1274108
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6620 West Broad Street, Suite 500
Richmond, Virginia 23230
(Address of principal executive offices, including zip code)
____________
Registrant's telephone number, including area code: (804)287-5680
PART I
ITEM 1. BUSINESS
Introduction
Cadmus Communications Corporation ("the Company" or
"Cadmus") is a graphic communications company which, through its
subsidiaries, provides printing, marketing, and publishing
services. The Company is a Virginia corporation headquartered at
6620 West Broad Street, Suite 500, Richmond, Virginia 23230.
Cadmus was formed in 1984 when The William Byrd Press,
Incorporated ("Byrd"), a leading regional publications printer,
combined its operations with Washburn Graphics, Inc.
("Washburn"), a vertically integrated graphic arts firm. Byrd,
in operation since 1904, is based in Richmond, Virginia and
Washburn, in operation since 1902, is based in Charlotte, North
Carolina.
Since its inception in 1984, Cadmus has grown primarily
through acquisitions of companies which either complement or
expand the capabilities the Company offers its customers. On
June 30, 1986, Cadmus acquired American Graphics, Inc.
("American"), a full-service graphic arts firm specializing in
promotional printing and the production of point-of-sale
advertising materials which is based in Atlanta, Georgia. Cadmus
Direct Marketing, Inc. ("CDMI"), formerly Washburn Direct
Marketing, Inc., was incorporated on January 1, 1990, having
previously operated as a division of Washburn. CDMI provides
direct marketing and database management services.
During fiscal year 1988, Cadmus acquired three additional
companies: Three Score, Inc. ("3 Score"), an Atlanta, Georgia
company engaged in retail and other direct mail catalog
production services; Garamond/Pridemark Press, Inc. ("Garamond"),
located in Baltimore, Maryland; and Vaughan Printers,
Incorporated ("Vaughan"), located in Orlando, Florida. Both
Garamond and Vaughan are smaller commercial printing companies
specializing in products similar to those at Washburn.
In fiscal year 1992, the Company acquired Tuff Stuff
Publications, Inc. ("Tuff Stuff") a Richmond, Virginia based
publisher of pricing guide magazines for various trading card
collectors and other related products. During fiscal year 1993,
the Company completed a joint venture arrangement with The Lanman
Companies, Inc. ("Lanman") whereby the operations of Vaughan were
combined with those of Central Florida Press, a division of
Lanman. This new company, Central Florida Press, L.C. ("CFP"),
located in Orlando, Florida, has both sheetfed and half-web print
capabilities. Also during the year, the Company acquired
Marblehead Communications, Inc. ("Marblehead"), based in Boston,
Massachusetts, which is a contract/custom publisher that
produces magazines and newsletters.
During fiscal year 1994, the Company acquired the net assets
of Waverly Press from Waverly, Inc. Waverly Press is a Maryland-
based premier printer of scientific, scholarly and medical
journals and now operates under the name Cadmus Journal Services,
Inc ("Cadmus Journal Services").
Printing and Marketing
Printing and marketing services account for approximately
92.5% of Cadmus revenues. Printing operations provide a full
range of services to customers which include state-of-the-art
data imaging, electronic prepress, multicolor printing, custom
binding and distribution services. The following is a list of
major printed materials produced with some examples of each:
Research Journals Medical and Biomedical, Technical and Scientific,
Learned and Scholarly, and Mathematics Journals
Specialty Periodicals Professional, Trade, Corporate and Consumer Magazines
Financial Documents Debt and Equity Offerings, Proxy Statements,
Annual Reports, and Quarterly Reports
Promotional Materials Catalogs, Directories, Brochures, Product
Literature, and Point-of-Sale Materials
Specialty Packaging Cartons, Portfolio Folders, 3-D Mailers and Video
Sleeves
Through our marketing services we provide our clients
complete creative, production, mailing, and fulfillment services
for direct marketing programs and marketing information systems.
Cadmus integrates direct marketing functions, ranging from
consumer market research and agency services to database
management and marketing information analysis, with the resulting
ability to implement tactical direct response campaigns and
programs for our clients. Cadmus also provides turn-key catalog
services from original design conception through the final
product for retail department stores, direct marketing retailers,
and industrial customers.
Publishing
Publishing services account for approximately 7.5% of Cadmus
revenues. There are two major types of published products:
Consumer Products Tuff Stuff publishes special interest
magazines which target specific
consumers. Currently there are four
such Cadmus-owned publications:
Tuff Stuff
Tuff Stuff's Collect!
Kenner Guide
Mid-Atlantic Soccer
Contract Products Marblehead publishes magazines for
clients under contract whereby the
client retains ownership of the title.
Cadmus contract services include design,
editorial, advertising sales,
production, and distribution of titles.
Other Factors Affecting the Business of Cadmus
Seasonal Fluctuations
Seasonal fluctuations occur in the overall demand for
printing. Printing of both periodicals for the educational and
scholarly market and promotional materials tends to decline in
the summer months. However, consumer publications tend to peak
before Christmas and before Easter. Printing of interim
financial statements clusters around the end of the first month
in each calendar quarter and printing of annual reports tends to
fall into the first and second calendar quarters. All of these
factors combine to give Cadmus a modest seasonal pattern with the
months October through June producing volumes slightly greater
than the months July through September.
Raw Materials
The principal raw material used in Cadmus' business is
paper. Significant stock inventories are not maintained except
at Byrd and Cadmus Journal Services, where a supply of roll paper
stock is required to operate the web presses. The other
companies generally purchase paper on a direct order basis for
specific jobs. Cadmus purchases its paper requirements under
agreements that guarantee tonnage and provide short range price
protection for three to six month intervals. The price of paper
charged to customers is subject to escalation so that, except in
rare instances, Cadmus does not have exposure to changes in the
cost of paper.
All Cadmus subsidiaries use a variety of other raw materials
including ink, film, offset plates, chemicals and solvents, glue,
wire, and subcontracted components. In general, none of the
subsidiaries have experienced any significant difficulty in
obtaining raw materials.
Competition
Cadmus is subject to competition from a large number of
companies, some of which have greater resources and capacity. In
recent years there has been an excess of capacity in the printing
industry which has increased competition. Rapid technological
change has brought new competitors to the marketplace.
The markets served by Cadmus face competition based on a
combination of factors including quality, service levels and
price.
Employees
As of June 30, 1994, Cadmus and its subsidiaries employed
approximately 2,400 persons. No employees are currently covered
by a collective bargaining agreement. Cadmus believes its
relationship with employees is excellent.
Regulation
The printing business uses or generates substantial
quantities of inks, solvents, and other waste products which
require disposal. The subsidiaries usually return salvageable
waste ink to their suppliers, and contract for the removal of
other waste products.
Cadmus believes its subsidiaries are in substantial
compliance with all applicable air quality, waste disposal, and
other environmental-related rules and regulations, as well as
with other general employee health and safety laws and
regulations.
The Virginia State Air Pollution Control Board (the "Board")
has expressed concern about excessive levels of certain air
pollutant emissions throughout the metropolitan Richmond area
from a number of sources, including automobiles and local
industries, such as Byrd. The Board has made no decision whether
further emission reductions will be required by automotive or
industry emissions controls. Depending on any future action by
the Board and in conjunction with the Clean Air Act Amendments of
1990, several industries, including Byrd, will be required to
take further actions to reduce emission levels, which may include
the installation of additional air pollution control equipment.
The amount of the expenditures necessitated by any such actions
is not anticipated to be material.
________________
See pages 6 through 9 and 12 through 17 of the 1994 Annual Report
to Shareholders (the "Annual Report") for additional information
on the business of Cadmus and its subsidiaries, which information
is incorporated herein by reference.
Signatures
Pursuant to the requirements of Section 13 or 15(d) 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, as of the 29th day of September, 1994.
CADMUS COMMUNICATIONS CORPORATION
/s/ C. Stephenson Gillispie, Jr.
C. Stephenson Gillispie, Jr.
President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act
of 1934, this report has been signed below by the following
persons on behalf of the Registrant and in their capacities, as
of the 29th day of September, 1994.
Signature Title
/s/ C. Stephenson Gillispie, Jr. President, Chief Executive Officer and Director
C. Stephenson Gillispie, Jr. (Principal Executive Officer)
/s/ Michael Dinkins Vice President and Chief Financial Officer
Michael Dinkins (Principal Financial and Accounting Officer)
*/s/ Robert I. Dalton, Jr. Director
Robert I. Dalton, Jr.
*/s/ Lee P. Dudley Director
Lee P. Dudley
*/s/ Price H. Gwynn, III Director
Price H. Gwynn, III
*/s/ Frank G. Louthan, Jr. Director
Frank G. Louthan, Jr.
*/s/ John D. Munford, II Director
John D. Munford, II
*/s/ John C. Purnell, Jr. Director
John C. Purnell, Jr.
*/s/ Russell M. Robinson, II Director
Russell M. Robinson, II
*/s/ John W. Rosenblum Director
John W. Rosenblum
*/s/ Wallace Stettinius Chariman of the Board and Director
Wallace Stettinius
*/s/ Bruce A. Walker Director
Bruce A. Walker
*By /s/ C. Stephenson Gillispie, Jr.
C. Stephenson Gillispie, Jr.
Attorney-in-fact