1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q/A
QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR QUARTER ENDED January 31, 1997 COMMISSION FILE NUMBER 1-9235
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THOR INDUSTRIES, INC.
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(Exact name of registrant as specified in its charter)
Delaware 93-0768752
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(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
419 West Pike Street, Jackson Center, OH 45334-0629
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (937) 596-6849
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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
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Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at 1/31/97
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Common stock, par value 8,143,489 shares
$.10 per share
2
THOR INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(AS RESTATED, SEE NOTE #3)
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ASSETS
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(UNAUDITED)
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JANUARY 31, 1997 JULY 31, 1996
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Current assets:
Cash and cash equivalents $4,141,490 $12,737,778
Accounts receivable:
Trade 46,652,217 48,147,482
Other 498,904 811,173
Inventories 58,836,606 62,566,455
Prepaid expenses 3,982,216 3,706,461
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Total current assets 114,111,433 127,969,349
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Property:
Land 1,259,801 1,212,024
Buildings and improvements 12,403,339 11,978,857
Machinery and equipment 14,579,462 15,182,013
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Total cost 28,242,602 28,372,894
Accumulated depreciation and amortization 11,302,145 11,167,142
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Property, net 16,940,457 17,205,752
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Other assets:
Goodwill 14,856,864 15,175,617
Non compete 4,431,516 4,912,964
Trademarks 2,696,166 2,858,835
Other 5,682,610 5,695,368
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Total other assets 27,667,156 28,642,784
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TOTAL ASSETS $158,719,046 $173,817,885
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LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current liabilities:
Accounts payable $19,981,164 $27,901,604
Line of credit 14,280,000 6,515,000
Accrued liabilities:
Compensation and related items 5,493,664 11,704,885
Product warranties 6,222,725 6,345,670
Other 1,308,645 1,739,731
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Total current liabilities 47,286,198 54,206,890
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Other liabilities 1,002,958 1,672,041
Stockholders' equity:
Common stock - authorized 10,000,000 shares;
issued 9,099,247 shares @ 1/31/97 and 9,099,247
shares @ 7/31/96; par value of $.10 per share 909,925 909,925
Additional paid in capital 25,105,120 25,105,120
Foreign currency translation (566,709) (641,856)
Retained earnings 104,357,802 98,380,961
Cost of treasury shares 955,758 shares @ 1/31/97;
412,439 shares @ 7/31/96 (19,376,248) (5,815,196)
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Total stockholders' equity 110,429,890 117,938,954
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $158,719,046 $173,817,885
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See notes to consolidated financial statements
3
THOR INDUSTRIES, INC. AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED INCOME
FOR THE THREE MONTHS AND SIX MONTHS ENDED JANUARY 31, 1997 AND 1996
(AS RESTATED, SEE NOTE #3)
--------------------------
THREE MONTHS ENDED JANUARY 31 SIX MONTHS ENDED JANUARY 31
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1997 1996 1997 1996
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Net sales $123,525,067 $119,780,958 $274,021,888 $271,300,162
Cost of products sold 112,069,018 107,680,280 246,423,249 242,888,855
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Gross profit 11,456,049 12,100,678 27,598,639 28,411,307
Selling, general, and
administrative expenses 8,185,152 8,921,903 16,702,136 18,329,621
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Operating income 3,270,897 3,178,775 10,896,503 10,081,686
Interest income 198,381 254,846 435,019 496,572
Interest expense (310,200) (163,451) (521,933) (250,091)
Other income (expense) (220,354) 4,923 164,608 91,177
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Income before income taxes 2,938,724 3,275,093 10,974,197 10,419,344
Provision for income taxes 1,247,020 1,392,622 4,492,446 4,316,173
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Net income $1,691,704 $1,882,471 $6,481,751 $6,103,171
========== ========== ========== ==========
Average common shares outstanding 8,258,377 8,888,062 8,464,984 8,895,894
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Earnings per common share $.20 $.21 $.77 $.69
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Dividends paid per common share $.03 $.03 $.06 $.06
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See notes to consolidated financial statements
4
THOR INDUSTRIES, INC. AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CASH FLOWS
FOR THE SIX MONTHS ENDED JANUARY 31, 1997 AND 1996
(AS RESTATED, SEE NOTE #3)
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(UNAUDITED)
1997 1996
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CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $6,481,751 $6,103,171
Adjustments to reconcile net income to net cash
used in operating activities:
Depreciation 1,171,022 1,105,654
Amortization 1,082,870 1,432,749
Changes in non cash assets and liabilities
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Accounts receivable 1,807,534 (2,518,692)
Inventories 3,729,849 386,906
Prepaid expenses and other (432,534) (1,467,338)
Accounts payable (7,920,440) (391,577)
Accrued liabilities (7,434,336) (4,921,012)
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Net cash used in operating activities (1,514,284) (270,139)
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CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant & equipment (1,020,790) (2,458,269)
Disposals of property, plant & equipment 164,600 33,632
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Net cash used in investing activities (856,190) (2,424,637)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Cash dividends (504,909) (533,730)
Net proceeds from line of credit 7,765,000 1,400,000
Purchase of treasury stock (13,561,052) (441,450)
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Net cash (used in) provided by financing activities (6,300,961) 424,820
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EFFECT OF EXCHANGE RATE CHANGES ON CASH 75,147 121,560
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Net decrease in cash and equivalents (8,596,288) (2,148,396)
Cash and equivalents, beginning of year 12,737,778 6,820,796
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CASH AND EQUIVALENTS, END OF PERIOD $4,141,490 $4,672,400
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SUPPLEMENTAL CASH FLOW INFORMATION:
Income taxes paid $4,284,000 $4,664,300
Interest paid 521,933 250,091
See notes to consolidated financial statements
5
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(AS RESTATED, SEE NOTE #3)
--------------------------
1. The accompanying consolidated financial statements, which are unaudited,
reflect all adjustments consisting of only normal recurring adjustments,
which are, in the opinion of management, necessary to present fairly the
consolidated operating results for such unaudited periods.
2. Major classifications of inventories (as restated) are:
(Unaudited)
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January 31, 1997 July 31, 1996
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Raw materials $37,419,970 $46,254,841
Work in process 11,562,455 12,400,652
Finished goods 12,874,383 6,529,164
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Total 61,856,808 65,184,657
Less excess of FIFO costs over LIFO costs 3,020,202 2,618,202
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Total inventories $58,836,606 $62,566,455
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3. During April 1998, the Company's management determined that the
accounting records at the General Coach - Brown City location were
incorrectly stated for all periods subsequent to July 31, 1995. The
balances specifically affected were cash, accounts receivable, inventory,
other accrued liabilities, cost of products sold and the provision for
taxes. As a result, the Company's financial statements as of January 31,
1997 and July 31, 1996 and for the three and six months ended January 31,
1997 and January 31, 1996 have been restated from the amounts previously
reported to correct the cash, accounts receivable, inventory, other
accrued liabilities, and its related effect on earnings.
The effects of the restatement are as follows:
Three Months Ended January 31, 1997 Three Months Ended January 31, 1996
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As Previously As As Previously As
Reported Restated Reported Restated
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Net Sales $123,525,067 $123,525,067 $119,780,958 $119,780,958
Cost of Products Sold 111,517,777 112,069,018 107,541,336 107,680,280
----------- ----------- ----------- -----------
Gross Profit 12,007,290 11,456,049 12,239,622 12,100,678
Selling General and
Administrative Exp. 8,185,152 8,185,152 8,921,903 8,921,903
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Operating Income 3,822,138 3,270,897 3,317,719 3,178,775
Other Income(Expense) (332,173) (332,173) 96,318 96,318
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Income before Tax 3,489,965 2,938,724 3,414,037 3,275,093
Provision for Taxes 1,470,824 1,247,020 1,449,589 1,392,622
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Net Income $2,019,141 $1,691,704 $1,964,448 $1,882,471
========== ========== ========== ==========
Earnings Per
Common Share $.24 $.20 $.22 $.21
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6
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(AS RESTATED, SEE NOTE #3)
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The effects of the restatement are as follows (Continued):
Six Months Ended January 31, 1997 Six Months Ended January 31, 1996
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As Previously As As Previously As
Reported Restated Reported Restated
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Net Sales $274,021,888 $274,021,888 $271,300,162 $271,300,162
Cost of Product Sold 245,324,688 246,423,249 242,425,254 242,888,855
----------- ----------- ----------- -----------
Gross Profit 28,697,200 27,598,639 28,874,908 28,411,307
Selling General and
Administrative Exp. 16,702,136 16,702,136 17,847,242 18,329,621
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Operating Income 11,995,064 10,896,503 11,027,666 10,081,686
Other Income(Expense) 77,694 77,694 (144,721) 337,658
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Income before Tax 12,072,758 10,974,197 10,882,945 10,419,344
Provision for Taxes 4,938,462 4,492,446 4,506,249 4,316,173
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Net Income $7,134,296 $6,481,751 $6,376,696 $6,103,171
========== ========== ========== ==========
Earnings Per
Common Share $.84 $.77 $.72 $.69
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January 31, 1997 July 31, 1996
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As Previously As As Previously As
Reported Restated Reported Restated
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Cash & Cash Equivalents $4,614,818 $4,141,490 $13,061,981 $12,737,778
Accounts Receivable 47,988,572 46,652,217 48,962,786 48,147,482
Other Receivables 498,904 498,904 811,173 811,173
Inventories 60,192,060 58,836,606 63,493,523 62,566,455
Prepaid Exp. & Other 3,982,216 3,982,216 3,706,461 3,706,461
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Total Current Assets 117,276,570 114,111,433 130,035,924 127,969,349
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Property, Plant & Eq.(Net) 16,940,457 16,940,457 17,205,752 17,205,752
Other Assets 27,667,156 27,667,156 28,642,784 28,642,784
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Total Assets 161,884,183 158,719,046 175,884,460 173,817,885
=========== =========== =========== ===========
Accounts Payable 19,981,164 19,981,164 27,901,604 27,901,604
Line of Credit 14,280,000 14,280,000 6,515,000 6,515,000
Accrued Liabilities 14,318,346 13,025,034 20,637,582 19,790,286
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Total Current Liabilities 48,579,510 47,286,198 55,054,186 54,206,890
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Other liabilities 1,002,958 1,002,958 1,672,041 1,672,041
Total stockholders' equity 112,301,715 110,429,890 119,158,233 117,938,954
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Total Liabilities & Equity $161,884,183 $158,719,046 $175,884,460 $173,817,885
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7
MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
(AS RESTATED, SEE NOTE #3)
--------------------------
Quarter Ended January 31, 1997 vs. Quarter Ended January 31, 1996
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Net sales for the second quarter totaled $123,525,067, up 3.1% from $119,780,958
in the same period last year. Income before income taxes was $2,938,724 compared
to $3,275,093 in the same period last year. This increase was primarily due to
reduction in selling, general and administrative expenses. In general, the
Company did not adjust its sales prices during the second quarter of fiscal
1997. Recreation vehicle revenues of $88,823,259 were 7.2% lower than last year
and were 71.9% of total company revenues compared to 79.9% last year. Bus
revenues of $34,701,808 were 44.2% higher than last year and were 28.1% of total
company revenues compared to 20.1% last year. Manufacturing gross profit was
9.3% of sales compared to 10.1% last year.
Operating income totaled $3,270,897, up 2.9% from $3,178,775 in the same period
last year. Selling, general and administrative expenses decreased to $8,185,152,
6.6% of sales, from $8,921,903, 7.4% of sales. Interest income decreased by
$56,465 and interest expense increased by $146,749. This increase in interest
expense was due primarily to additional borrowing for the purchase of 503,319
shares of treasury stock. The combined income tax rate was 42.4% compared to
42.5% last year.
Six Months Ended January 31, 1997 vs. Six Months Ended January 31, 1996
- -----------------------------------------------------------------------
Net sales for the six months totaled $274,021,888, up 1.0% from $271,300,162 in
the same period last year. Income before income taxes was $10,974,197 compared
to $10,419,344 in the same period last year. This increase was due primarily to
reduction in selling, general and administrative expenses. Recreation vehicle
revenues of $206,392,070 were 6.4% lower than last year and were 75.3% of total
company revenues compared to 81.3% last year. Bus revenues of $67,629,818 were
33.2% higher than last year and were 24.7% of total company revenues compared to
18.7% last year. Manufacturing gross profit was 10.1% of sales compared to 10.5%
last year.
Operating income totaled $10,896,503, up 8.1% from $10,081,686 in the same
period last year. Selling, general and administrative expenses decreased to
$16,702,136, 6.1% of sales, from $18,329,621, 6.8% of sales. An adjustment to
deferred compensation in the first quarter of fiscal 1997 accounted for $669,000
reduction in administrative expense. Interest income decreased by $61,553 and
interest expense increased by $271,842. This increase in interest expense was
due primarily to additional borrowings for the purchase of 543,319 shares of
treasury stock. The combined income tax rate was 40.9% compared to 41.4% last
year.
Financial Condition and Liquidity
- ---------------------------------
As of January 31, 1997, Thor had $4,141,490 in cash and cash equivalents,
compared to $12,737,778 on July 31, 1996. Working capital at January 31, 1997
was $66,825,235 compared to $73,762,459 at July 31, 1996. Inventory valued at
current cost at January 31, 1997 exceeded the LIFO inventory by $3,020,202.
On January 31, 1997, the Company had a $30,000,000 revolving line of credit with
Harris Trust and Savings Bank and Bank One. The amount borrowed under this line
as of January 31, 1997 was $14,280,000. The loan agreement contains certain
covenants, including restrictions on additional indebtedness, and the Company
must maintain certain financial ratios. The line of credit bears interest at
negotiated rates below prime and expires on November 30, 1997. The Company had
no long term debt as of January 31, 1997. Amortization of intangibles decreased
from $1,432,749 through January 31, 1996 to $1,082,870 through January 31, 1997
due to certain intangibles being fully amortized.
During the six months of fiscal 1997, Thor purchased 543,319 shares of its
common stock, increasing treasury stock by $13,561,052.
The Company believes internally generated funds and the revolving credit
agreement already in place will be sufficient to meet current operating needs
and anticipated capital requirements. The Company does not anticipate
significant capital expenditures for fiscal 1997.
8
PART II
Item 4. Submission of Matters to a Vote of Security Holders
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Annual Meeting of Shareholders on December 9, 1996
Matters Voted on by Shareholders:
---------------------------------
1.) Election of Director: Wade F. B. Thompson
Results of Voting by Shareholders:
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For Against Abstain
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Item 1 8,253,140 -0- 29,625
SIGNATURES
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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.
THOR INDUSTRIES, INC.
(Registrant)
DATE June 9, 1998 (Signed) /s/ Wade F. B. Thompson
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Wade F. B. Thompson, Chairman of the Board,
President and Chief Executive Officer
DATE June 9, 1998 (Signed) /s/ Walter L. Bennett
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Walter L. Bennett, Senior Vice President,
Secretary (Chief Accounting Officer)