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EXHIBIT 19
(LOGO)
AMERICAN
BUSINESS
PRODUCTS
INC.
QUARTERLY REPORT TO SHAREHOLDERS
3 MONTHS ENDED MARCH 31, 1994
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AMERICAN BUSINESS PRODUCTS, INC.
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[LOGO]
TO OUR SHAREHOLDERS:
Sales advanced to a new record for the first quarter while a combination of
factors contributed to lower earnings. Even so, the quarterly earnings have been
exceeded only once in a first quarter in the history of the Company.
The increase of 19.5% in our sales set an all-time high at $140.7 million.
Income before the effect of mandated accounting charges (FASB 112) was $4.3
million or $.40 per share compared with $4.7 million or $.44 per share for the
first quarter last year. After giving effect to the non-cash charge, net income
was $3.7 million or $.34 per share. This one-time accounting charge must be
taken in 1994 by all companies providing post-employment benefits.
Factors affecting profits included severe weather in the East and Midwest
combined with the California earthquake, disrupting production at 23 of our 41
production facilities and resulting in unusual labor costs to fulfill customer
service commitments. Other factors were strong pricing competition for some
product lines and a higher federal tax rate. With more normal conditions and
moderate growth in the economy, we expect a good year.
At the annual meeting of shareholders yesterday, four directors were elected to
new three-year terms; Duane Ackerman, John Aderhold, Thomas Keller and Marvin
Schmalzried. Following a succession plan announced last December, W. J. Biggers
retired as Chairman of the Board; CEO, Thomas R. Carmody was elected to that
position; and Chief Operating Officer, Robert W. Gundeck was promoted from
Executive Vice President to President of the Company.
The Directors approved a regular quarterly dividend of $.20 per share payable
June 15 to shareholders of record June 1.
Thomas R. Carmody Robert W. Gundeck
Chairman and President and
Chief Executive Officer Chief Operating Officer
April 28, 1994
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FINANCIAL HIGHLIGHTS FIRST QUARTER
PERIOD ENDED MARCH 31 1994 1993
Net sales $140,715,000 $117,749,000
Net income 3,661,000 4,670,000
Net income per common share .34 .44
Dividends per common share .20 .1875
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CONSOLIDATED INCOME STATEMENTS
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1994 1993
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QUARTER ENDED MARCH 31
Net Sales.................................................. $140,715,000 $117,749,000
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Cost of Goods Sold......................................... 98,790,000 81,753,000
Selling and Administrative Expenses........................ 32,773,000 28,092,000
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131,563,000 109,845,000
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Operating Income........................................... 9,152,000 7,904,000
Other Income (Expense)
Interest expense......................................... (2,366,000) (1,264,000)
Miscellaneous -- net..................................... 237,000 465,000
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Income Before Income Taxes and Cumulative Effect of Changes
in Accounting Principles................................. 7,023,000 7,105,000
Provision for Income Taxes................................. 2,757,000 2,435,000
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Income Before Cumulative Effect of Changes in Accounting
Principles............................................... 4,266,000 4,670,000
Cumulative Effect of Changes In Accounting Principles...... (605,000)
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Net Income................................................. $ 3,661,000 $ 4,670,000
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Per Common Share:
Income Before Cumulative Effect of Changes in Accounting
Principles............................................ $ .40 $ .44
Net Income............................................... .34 .44
Dividends Per Common Share................................. .20 .1875
Average Number of Common Shares Outstanding................ 10,682,195 10,686,076
(Unaudited)
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CONSOLIDATED BALANCE SHEETS
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MARCH 31, DECEMBER 31,
1994 1993
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Current Assets
Cash and cash equivalents............................... $ 24,799,000 $ 30,151,000
Accounts receivable, less allowances of $2,277,000 and
$2,218,000........................................... 68,872,000 65,000,000
Inventories............................................. 48,471,000 45,687,000
Other................................................... 809,000 930,000
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Total Current Assets............................ 142,951,000 141,768,000
Plant And Equipment -- At Cost
Land.................................................... 5,940,000 5,940,000
Buildings and improvements.............................. 48,603,000 48,475,000
Machinery and equipment................................. 124,136,000 121,805,000
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178,679,000 176,220,000
Less accumulated depreciation........................... 85,292,000 81,772,000
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93,387,000 94,448,000
Intangible Assets From Acquisitions
Goodwill, less amortization of $1,872,000 and
$1,651,000........................................... 32,245,000 31,634,000
Other, less amortization of $3,398,000 and $3,173,000... 3,049,000 3,274,000
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35,294,000 34,908,000
Deferred Income Taxes..................................... 8,263,000 7,963,000
Other Assets.............................................. 21,565,000 23,105,000
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$301,460,000 $302,192,000
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Current Liabilities
Accounts payable........................................ $ 34,510,000 $ 36,241,000
Salaries and wages...................................... 8,534,000 8,530,000
Profit sharing contributions............................ 1,196,000 4,106,000
Income taxes............................................ 1,299,000 200,000
Current maturities of long-term debt.................... 6,253,000 6,253,000
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Total Current Liabilities....................... 51,792,000 55,330,000
Long-Term Debt And Capital Leases......................... 85,202,000 85,580,000
Supplemental Retirement Benefits.......................... 13,552,000 12,880,000
Postretirement Benefits................................... 22,289,000 21,309,000
Stockholders' Equity
Common stock -- $2 par value; authorized 50,000,000
shares, issued 10,774,484 shares..................... 21,549,000 21,549,000
Retained earnings....................................... 109,246,000 107,728,000
Foreign currency translation adjustment................. (433,000) (433,000)
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130,362,000 128,844,000
Less 91,382 and 92,391 shares of Common Stock in
treasury -- at cost.................................. 1,737,000 1,751,000
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128,625,000 127,093,000
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$301,460,000 $302,192,000
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(Unaudited)
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ABP SHAREHOLDER INFORMATION
ABP has a Dividend Reinvestment Plan which is open to all shareholders of ABP
common stock. This Plan allows the reinvestment of dividends on a regular
quarterly basis and accepts optional cash investments from $10 to $1,000 per
month. If you would like more information on this program, you can write to
Diana Coursey, Investor Relations, American Business Products, Inc., P.O. Box
105684, Atlanta, Georgia 30348.
If you have a change of address, need to transfer shares or have other questions
regarding your current ABP holdings you can contact Wachovia Bank of North
Carolina, P.O. Box 3001, Winston-Salem, NC 27102-3001 or call 1 (800) 633-4236.
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(LOGO) AMERICAN BUSINESS PRODUCTS, INC.
2100 RIVEREDGE PARKWAY
SUITE 1200
ATLANTA, GA. 30328
404-953-8300
MAILING ADDRESS:
P.O. BOX 105684
ATLANTA, GA. 30348