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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended September 30, 2000
Commission File Number 0-16960
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THE GENLYTE GROUP INCORPORATED
AND SUBSIDIARIES
4360 BROWNSBORO ROAD
LOUISVILLE, KY 40207
(502) 893-4600
Incorporated in Delaware I.R.S. Employer
Identification No. 22-2584333
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 [_]
THE NUMBER OF SHARES OUTSTANDING OF THE ISSUER'S COMMON STOCK AS OF NOVEMBER 9,
2000 WAS 13,234,425.
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THE GENLYTE GROUP INCORPORATED AND SUBSIDIARIES
FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 2000
INDEX
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Consolidated Statements of Income for the three
months ended September 30, 2000 and October 2,
1999..............................................................1
Consolidated Statements of Income for the nine months
ended September 30, 2000 and October 2,
1999..............................................................2
Consolidated Balance Sheets as of
September 30, 2000 and December 31, 1999..........................3
Consolidated Statements of Cash Flows for the nine
months ended September 30, 2000 and October 2, 1999...............4
Notes to Consolidated Interim Financial Statements..................5
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS.........................10
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF
SECURITY HOLDERS.............................................13
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.............................13
Signatures...........................................................14
Exhibit 27: Financial Data Schedule..................................15
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
THE GENLYTE GROUP INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2000 AND OCTOBER 2, 1999
(000'S OMITTED, EXCEPT PER SHARE DATA)
(Unaudited)
2000 1999
-------- --------
Net sales $257,308 $257,811
Cost of sales 170,142 170,003
-------- --------
Gross profit 87,166 87,808
Selling and administrative expenses 62,821 63,532
-------- --------
Operating profit 24,345 24,276
Interest expense, net 587 1,393
Minority interest 7,086 6,880
-------- --------
Income before income taxes 16,672 16,003
Income tax provision 6,801 6,745
-------- --------
Net income $ 9,871 $ 9,258
======== ========
Earnings per share
Basic $ 0.73 $ 0.67
Diluted $ 0.73 $ 0.66
The accompanying notes are an integral part of these consolidated financial
statements.
1
THE GENLYTE GROUP INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 AND OCTOBER 2, 1999
(000'S OMITTED, EXCEPT PER SHARE DATA)
(Unaudited)
2000 1999
-------- --------
Net sales $753,299 $738,932
Cost of sales 500,644 494,276
-------- --------
Gross profit 252,655 244,656
Selling and administrative expenses 186,444 180,424
-------- --------
Operating profit 66,211 64,232
Interest expense, net 2,127 3,664
Minority interest 19,351 18,575
-------- --------
Income before income taxes 44,733 41,993
Income tax provision 18,587 17,920
-------- --------
Net income $ 26,146 $ 24,073
======== ========
Earnings per share
Basic $ 1.92 $ 1.74
Diluted $ 1.91 $ 1.73
The accompanying notes are an integral part of these consolidated financial
statements.
2
THE GENLYTE GROUP INCORPORATED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 2000 AND DECEMBER 31, 1999
(000'S OMITTED)
(Unaudited)
9/30/2000 12/31/1999
------------- -------------
ASSETS:
CURRENT ASSETS:
Cash and cash equivalents $ 41,948 $ 22,660
Accounts receivable, less allowance for doubtful
accounts of $13,019 and $14,910, respectively 166,757 155,428
Inventories:
Raw materials 54,339 46,717
Work in process 12,328 14,027
Finished goods 73,404 75,297
------------- -------------
Total inventories 140,071 136,041
Other current assets 30,887 29,938
------------- -------------
Total current assets 379,663 344,067
Plant and equipment, at cost 337,494 322,867
Less: accumulated depreciation and amortization 231,175 217,878
------------- -------------
Net plant and equipment 106,319 104,989
Cost in excess of net assets of acquired businesses 116,487 111,426
Other assets 10,697 15,228
------------- -------------
TOTAL ASSETS $ 613,166 $ 575,710
============= =============
LIABILITIES & STOCKHOLDERS' INVESTMENT:
CURRENT LIABILITIES:
Short-term borrowings and current portion of long-term debt $ 2,130 $ 1,647
Accounts payable 92,622 86,717
Accrued expenses 74,380 80,001
------------- -------------
Total current liabilities 169,132 168,365
Long-term debt 65,306 53,964
Deferred income taxes 31,732 31,797
Minority interest 110,023 98,940
Other liabilities 19,862 20,102
------------- -------------
Total liabilities 396,055 373,168
STOCKHOLDERS' INVESTMENT:
Common stock 133 137
Additional paid-in capital 7,598 17,761
Retained earnings 179,453 153,307
Accumulated other comprehensive income 29,927 31,337
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Total stockholders' investment 217,111 202,542
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TOTAL LIABILITIES & STOCKHOLDERS' INVESTMENT $ 613,166 $ 575,710
============= =============
The accompanying notes are an integral part of these consolidated financial
statements.
3
THE GENLYTE GROUP INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2000 AND OCTOBER 2, 1999
(000'S OMITTED)
(Unaudited)
2000 1999
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 26,146 $ 24,073
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 20,337 17,180
Net loss from disposals of plant and equipment 578 194
Changes in assets and liabilities, net of effect of acquisitions:
Accounts receivable (9,575) (28,848)
Inventories (2,628) 2,795
Other current assets (924) (3,903)
Other assets 890 (22,770)
Accounts payable and accrued expenses (914) 31,714
Deferred income taxes (65) (872)
Minority interest 11,083 12,111
Other liabilities (297) 1,415
Minimum pension liability -- 230
All other, net 683 592
---------- ----------
Net cash provided by operating activities 45,314 33,911
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisitions, net of cash acquired (6,173) (31,392)
Purchases of plant and equipment (19,520) (14,605)
---------- ----------
Net cash used in investing activities (25,693) (45,997)
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Decrease in short-term borrowings (30) --
Proceeds from long-term debt 12,600 10,505
Reductions in long-term debt (1,326) --
Purchases of treasury stock (11,155) (271)
Stock options exercised 988 1,442
---------- ----------
Net cash provided by financing activities 1,077 11,676
---------- ----------
Effect of exchange rate changes on cash and cash equivalents (1,410) 926
---------- ----------
Net increase in cash and cash equivalents 19,288 516
Cash and cash equivalents at beginning of period 22,660 8,555
---------- ----------
Cash and cash equivalents at end of period $ 41,948 $ 9,071
========== ==========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest $ 1,934 $ 3,377
Income taxes $ 21,081 $ 14,302
The accompanying notes are an integral part of these consolidated
financial statements.
4
THE GENLYTE GROUP INCORPORATED AND SUBSIDIARIES
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS
AS OF SEPTEMBER 30, 2000
(000'S OMITTED, EXCEPT PER SHARE DATA)
(Unaudited)
1. BASIS OF PRESENTATION
Throughout this Form 10-Q, the term "Company" as used herein refers to
The Genlyte Group Incorporated, including the consolidation of The
Genlyte Group Incorporated and all majority-owned subsidiaries. The
term "Genlyte" as used herein refers only to The Genlyte Group
Incorporated.
The financial information presented is unaudited (except that as of
December 31, 1999), however, such information reflects all adjustments,
consisting solely of normal recurring adjustments, which are, in the
opinion of management, necessary for a fair statement of results for
the interim periods. The financial information has been prepared in
accordance with rules and regulations of the Securities and Exchange
Commission for Form 10-Q. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with
generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations. For further information refer
to the consolidated financial statements and notes thereto included in
the Company's Annual Report on Form 10-K for the year ended December
31, 1999.
The results of operations for the nine-month period ended September 30,
2000 are not necessarily indicative of the results to be expected for
the full year.
2. USE OF ESTIMATES
Management of the Company has made a number of estimates and
assumptions relating to the reporting of assets and liabilities and the
disclosure of contingent assets and liabilities to prepare these
financial statements in conformity with generally accepted accounting
principles. Actual results could differ from these estimates.
3. COMPREHENSIVE INCOME
For the three months ended September 30, 2000 and October 2, 1999 total
comprehensive income was $9,328 and $8,926, respectively. For the nine
months ended September 30, 2000 and October 2, 1999 total comprehensive
income was $24,736 and $24,815, respectively.
5
4. EARNINGS PER SHARE
The calculation of the average common shares outstanding assuming
dilution for the three months ended September 30, 2000 and October 2,
1999 follows:
2000 1999
------ ------
Average common shares outstanding 13,456 13,891
Incremental common shares issuable:
Stock option plans 118 38
------ ------
Average common shares outstanding
assuming dilution 13,574 13,929
====== ======
The calculation of the average common shares outstanding assuming
dilution for the nine months ended September 30, 2000 and October 2,
1999 follows:
2000 1999
------ ------
Average common shares outstanding 13,606 13,814
Incremental common shares issuable:
Stock option plans 118 17
------ ------
Average common shares outstanding
assuming dilution 13,724 13,831
====== ======
5. ACQUISITION OF TRANSLITE
As of September 14, 2000 the Company acquired Translite Limited
("Translite"), a San Carlos, California based manufacturer of
low-voltage cable and track lighting systems and decorative
architectural glass lighting. Earlier this year, the Company had
announced signing a letter of intent to acquire Translite Systems, Inc.
Since that announcement, Translite Systems, Inc. expanded its
operations by merging with Sonoma Lighting Limited, which had been a
manufacturer of decorative architectural glass lighting. The Company
purchased all of the outstanding capital stock of Translite for $6,247,
borrowing $5,000 from the revolving credit facility and funding the
remainder from cash on hand.
The Translite acquisition has been accounted for using the purchase
method of accounting. The preliminary determination of the excess of
the purchase price over the fair market value of net assets acquired of
$4,633 is being amortized on a straight-line basis over 30 years. The
determination of the fair market value as reflected in the balance
sheet is subject to change. The operating results of Translite have
been included in the Company's consolidated financial statements since
the date of acquisition.
6. INVESTMENT IN FIBRE LIGHT AND ACQUISITION OF LEDALITE
On May 10, 1999, the Company acquired a 2% interest (with rights to
acquire an additional 6%) in Fibre Light International, based in
Burleigh Heads, Queensland, Australia. Fibre Light International is in
the business of commercializing fiber optic lighting technology. The
two companies then formed a jointly owned limited liability company
named Fibre Light U.S. LLC ("Fibre Light"), of which the Company owns
80%. Fibre Light manufactures, markets, and sells fiber optic lighting
systems in the U.S.
6
On June 30, 1999, the Company acquired the assets and liabilities of
privately held Ledalite Architectural Products Inc. ("Ledalite"),
located in Vancouver, Canada. Ledalite designs, manufactures, and sells
architectural linear lighting systems for offices, schools,
transportation facilities, and other commercial buildings. The purchase
price of these acquisitions totaled $31,469 (including costs of
acquisition), consisting of approximately $8.5 million in cash payments
and approximately $23 million in borrowings.
The Ledalite acquisition has been accounted for using the purchase
method of accounting. The excess of the purchase price over the fair
market value of net assets acquired of $27,068 is being amortized on a
straight-line basis over 30 years. The purchase agreement provides for
additional payments contingent upon future operating results of the
acquired entity. The additional consideration, if and when paid, will
be recorded as additional cost in excess of net assets of acquired
businesses.
The operating results of Fibre Light and Ledalite have been included in
the Company's consolidated financial statements since the dates of
acquisition. On an unaudited pro forma basis, assuming these
acquisitions had occurred at the beginning of 1999, the Company's
results would have been:
Nine Months Ended
9/30/2000 10/2/1999
Actual Pro Forma
--------- ---------
Net sales $ 753,299 $ 750,956
Net income 26,146 23,784
Earnings per share $ 1.91 $ 1.71
The pro forma results do not purport to state exactly what the
Company's results of operations would have been had the acquisitions in
fact been consummated as of the assumed date and for the periods
presented, nor are they necessarily indicative of future consolidated
results.
7. SEGMENT REPORTING
Reportable operating segments include the Commercial, Residential, and
Industrial and Other segments. Inter-segment sales are eliminated in
consolidation and therefore not presented in the table below. Results
for certain product lines were reclassified from the Commercial segment
to the Residential and to the Industrial and Other segments at the end
of 1999. All 1999 amounts have been restated to conform to the current
year classification. For the three months ended September 30, 2000 and
October 2, 1999:
Industrial
Commercial Residential and Other Total
----------- ----------- ----------- -----------
2000
Net sales $ 182,003 $ 34,278 $ 41,027 $ 257,308
Operating profit $ 17,890 $ 2,712 $ 3,743 $ 24,345
1999
Net sales $ 183,053 $ 34,758 $ 40,000 $ 257,811
Operating profit $ 18,728 $ 1,940 $ 3,608 $ 24,276
7
For the nine months ended September 30, 2000 and October 2, 1999:
Industrial
Commercial Residential and Other Total
----------- ----------- ----------- -----------
2000
Net sales $ 536,860 $ 104,294 $ 112,145 $ 753,299
Operating profit $ 48,507 $ 7,454 $ 10,250 $ 66,211
1999
Net sales $ 512,893 $ 107,977 $ 118,062 $ 738,932
Operating profit $ 48,073 $ 5,740 $ 10,419 $ 64,232
The Company has operations throughout North America. Information about
the Company's operations by geographical area for the three months
ended September 30, 2000 and October 2, 1999 follows. Foreign balances
represent activity in Canadian operations.
United States Foreign Total
------------- -------- --------
2000
Net sales $ 220,910 $ 36,398 $ 257,308
Operating profit $ 18,810 $ 5,535 $ 24,345
1999
Net sales $ 223,919 $ 33,892 $ 257,811
Operating profit $ 19,508 $ 4,768 $ 24,276
Information about the Company's operations by geographical area for the
nine months ended September 30, 2000 and October 2, 1999 follows:
United States Foreign Total
------------- -------- --------
2000
Net sales $ 654,140 $ 99,159 $ 753,299
Operating profit $ 54,859 $ 11,352 $ 66,211
1999
Net sales $ 648,276 $ 90,656 $ 738,932
Operating profit $ 55,390 $ 8,842 $ 64,232
No material changes have occurred in total assets since December 31,
1999.
8
8. SUBSEQUENT EVENT
As of October 1, 2000, the Company acquired the assets of the US Safety
System Division of Chloride Power Electronics, Inc., from the Chloride
Group, PLC, headquartered in London, England. The purchase includes the
US Chloride Safety Systems and LightGuard Emergency Lighting brands.
The purchase price was $52 million in cash plus the assumption of $2.8
million in liabilities. The revolving credit facility was used to
borrow $35 million and cash on hand was used to pay the remaining $17
million. The US Safety System Division manufacturing, sales, and
administrative personnel will remain located in Burgaw, North Carolina.
9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
COMPARISON OF THIRD QUARTER 2000 TO THIRD QUARTER 1999
Net sales for the third quarter of 2000 were $257.3 million, flat compared to
1999 third quarter sales of $257.8 million. Net sales in 2000 have been
negatively impacted by three primary factors. First, in the Commercial segment,
by management's decision not to participate in some low margin fluorescent
business. Second, in the Residential segment, by continuing our strategy to
withdraw from lower margin do-it-yourself business. Third, the Company
experienced some manufacturing disruptions and service problems while executing
the production transfers from the Milan, Illinois facility to San Marcos, Texas
and from Kent, Washington to Langley, British Columbia. Management expects these
manufacturing start-up inefficiencies and service problems to abate during the
fourth quarter. Sales for the third quarter of 2000 and the third quarter of
1999 both included Ledalite Architectural Products, which was purchased at the
end of June 1999. Ledalite contributed approximately 2.8 percent and 3.3 percent
of sales for the third quarter of 2000 and 1999, respectively.
Net income for the third quarter of 2000 was $9,871,000 ($0.73 per share), a 6.6
percent increase over the third quarter 1999 net income of $9,258,000 ($0.66 per
share). Because of lower outstanding shares due to our share repurchase program,
earnings per share increased a greater percentage (10.6 percent) than net
income. The Company purchased 344 thousand shares of stock at an average price
of $22.88 during the third quarter of 2000.
Cost of sales for the third quarter of 2000 was 66.1 percent of net sales,
compared to 65.9 percent in the third quarter of 1999. The manufacturing
start-up inefficiencies mentioned above contributed to this increase. Selling
and administrative expenses for the third quarter of 2000 were 24.4 percent of
net sales, compared to 24.6 percent in the third quarter of 1999. Net interest
expense decreased 58 percent to $587,000 in the third quarter of 2000 from
$1,393,000 in the third quarter of 1999. The net decrease was the result of both
a reduction in debt, reducing interest expense, and an increase in cash and cash
equivalents, increasing interest income.
The effective tax rate was 40.8 percent for the third quarter of 2000 compared
to 42.1 percent for the third quarter of 1999. The decrease in the effective
rate is due to research and development tax credits in Canada, state tax credits
in the U.S., and state tax planning strategies involving restructuring of legal
entities.
COMPARISON OF FIRST NINE MONTHS 2000 TO FIRST NINE MONTHS 1999
Net sales for the first nine months of 2000 were $753.3 million, an increase of
1.9 percent from the first nine months of 1999. Net sales have been negatively
impacted in the first nine months of 2000 by the same three factors mentioned
above. Sales for the period included Ledalite Architectural Products for all
nine months in 2000, but only three months in 1999. Ledalite contributed
approximately 3.1 percent of sales for the first nine months of 2000.
Net income for the first nine months of 2000 was $26,146,000 ($1.91 per share),
an 8.6 percent increase over 1999 net income of $24,073,000 ($1.73 per share)
for the comparable period. Because of lower outstanding shares due to our share
repurchase program, earnings per share increased a greater percentage (10.4
percent) than net income. The Company purchased 511 thousand shares of stock at
10
an average price of $21.85 during the first nine months of 2000.
Cost of sales for the first nine months of 2000 was 66.5 percent of net sales,
compared to 66.9 percent in the first nine months of 1999. This decrease is
primarily attributed to continuing raw material cost savings resulting from the
combination of Genlyte and Thomas Lighting, as well as cost savings realized
from plant consolidations during 1999.
Selling and administrative expenses increased to 24.8 percent of sales in the
first nine months of 2000 from 24.4 percent in the first nine months of 1999.
These expenses at companies acquired last year are considerably higher as a
percentage of sales than the average for the rest of the Company. Excluding
companies acquired last year, selling and administgrative expenses as a
percentage of sales were 0.3 percent lower in 2000 than in 1999.
Net interest expense decreased 42 percent to $2,127,000 in the first nine months
of 2000 from $3,664,000 in the first nine months of 1999. The net decrease was
the result of both a reduction in debt, reducing interest expense, and an
increase in cash and cash equivalents, increasing interest income.
The effective tax rate was 41.6 percent for the first nine months of 2000
compared to 42.7 percent for the first nine months of 1999. The decrease in the
effective rate is due to research and development tax credits in Canada, state
tax credits in the U.S., and state tax planning strategies involving
restructuring of legal entities.
LIQUIDITY AND CAPITAL RESOURCES
The Company focuses on its level of net debt (total debt minus cash and cash
equivalents), its level of working capital, and its current ratio as its most
important measures of short-term liquidity. For long-term liquidity, the Company
considers its ratio of total debt to total capital employed (total debt plus
total stockholders' investment) and trends in net debt and cash provided by
operating activities to be the most important measures. From both a short-term
and a long-term perspective, the Company's liquidity is very strong.
Net debt decreased to $25.5 million at September 30, 2000, compared to $32.9
million at December 31, 1999. Total debt increased to $67.4 million at September
30, 2000, compared to $55.6 million at December 31, 1999, while cash and cash
equivalents increased to $41.9 million at September 30, 2000, compared to $22.7
million at December 31, 1999. The increase in borrowings was mainly due to the
addition of a $7.6 million industrial revenue bond in the second quarter to
finance a plant expansion and paint line at one of our divisions and $5 million
borrowed from the revolving credit facility in the third quarter to pay for the
Translite acquisition. Working capital at September 30, 2000 was $210.5 million,
compared to $175.7 million at December 31, 1999. This increase was primarily due
to the increase in cash as explained in paragraphs below, increases in accounts
receivable and inventory. Due to seasonal tendencies of the Company's business,
accounts receivable increased during the first nine months of 2000, although
this increase was much less than the comparable period of the last two years.
The current ratio increased to 2.2 at September 30, 2000 from 2.0 at December
31, 1999.
The ratio of total debt to total capital employed remained very low at 23.7
percent compared to 21.5 percent at December 31, 1999. Net debt has been
trending down year by year ever since the formation of Genlyte Thomas, and is
now lower than the levels before the merger. Cash provided by operating
activities during the first nine months of 2000 is greater than any comparable
period in the Company's history.
11
Cash provided by operating activities during the first nine months of 2000 was
$45.3 million, compared to $33.9 million in the first nine months last year. Net
income and depreciation and amortization were both higher in 2000 than in 1999,
but the main reason for the increase in cash provided by operating activities
was because of differences in the changes in assets and liabilities. Accounts
receivable increased a much smaller amount in 2000 than it did in 1999. Accounts
receivable increased to an unusually high amount in 1999 because of collection
problems at certain divisions that have been improved in 2000. Other assets
decreased slightly in 2000 compared to a large increase in 1999 that was due to
an increase in cost in excess of net assets of acquired businesses. Offsetting
the impact of these two assets was a slight decrease in accounts payable and
accrued expenses in 2000 compared to a large increase in 1999.
Cash used in investing activities is comprised of acquisitions of businesses and
purchases of plant and equipment. During the first nine months of 2000, the net
amount paid for the Translite acquisition was $6.2 million, compared to $31.4
million paid for the Ledalite acquisition and the investment in Fibre Light in
1999. Purchases of plant and equipment in the first nine months of 2000 were
$4.9 million higher than the comparable period last year.
As of October 1, 2000 the Company acquired the assets of the US Safety System
Division of Chloride Power Electronics, Inc., from the Chloride Group, PLC,
headquartered in London, England. The purchase price was $52 million in cash
plus the assumption of approximately $2.8 million in liabilities. The revolving
credit facility was used to borrow $35 million and cash on hand was used to pay
the remaining $17 million. This transaction will be recorded in the fourth
quarter. Also, the Company has plans to spend approximately $30 million (with
less than $2 million anticipated to be spent in the fourth quarter of 2000) to
build and relocate into a new 300,000 square foot HID (high intensity discharge)
manufacturing plant in San Marcos, Texas. The facility, which is scheduled to
open late next year, will provide world class manufacturing capability and
replace current multiple facilities.
Cash provided by financing activities during the first nine months of 2000 was
$1.1 million, with $1 million provided by stock options exercised, and the
increase in total debt virtually offset by the $11.2 million purchases of
treasury stock. Cash provided by financing activities in 1999 was $11.7 million,
from new debt and stock options exercised, but very little purchases of treasury
stock.
The Company has a $150 million revolving credit facility with Bank of America
that matures in August 2003. At September 30, 2000 the Company had $5 million in
borrowings and $47.2 million in outstanding letters of credit under this
facility. The Company's remaining long-term debt at September 30, 2000 consisted
of $19.0 million in Canadian dollar notes from the Ledalite acquisition, $22.3
million payable to Thomas Industries Inc., $18.1 million in industrial revenue
bonds, and $0.9 million in capital leases and other. The Company is in
compliance with all of its debt covenants.
Management believes that currently available cash and borrowing facilities,
combined with internally generated funds, should be sufficient to fund capital
expenditures as well as any increase in working capital required to accommodate
business needs in the foreseeable future. The Company continues to seek
opportunities to acquire businesses that fit its strategic growth plans.
Management believes adequate financing for any such investments will be
available through future borrowings.
For the nine months ended September 30, 2000 and October 2, 1999, 13.2 percent
and 12.3 percent, respectively, of the Company's net sales were generated from
operations in Canada. In addition, the Company has production facilities in
Mexico. International operations are subject to fluctuations in currency
exchange rates. The Company monitors its currency exposure in each country, but
it has not entered into forward exchange contracts to hedge risks. Management
cannot predict future foreign currency fluctuations, which have and will
continue to affect the Company's balance sheet and results of operations.
FORWARD-LOOKING STATEMENTS
The statements in this document with respect to future results, future
expectations, and plans for future activities may be regarded as forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995, and actual results may differ materially from those currently expected.
The Company makes no commitment to disclose any revision to forward-looking
statements, or any facts, events or circumstances after the date hereof that may
bear upon forward-looking statements.
12
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibit 27: Financial Data Schedule
(b) Reports on Form 8-K: None
13
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, Genlyte has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
THE GENLYTE GROUP INCORPORATED
(Registrant)
Date: November 14, 2000 /s/ LARRY K. POWERS
-------------------------------
Larry K. Powers
Chairman, President & CEO
Date: November 14, 2000 /s/ WILLIAM G. FERKO
-------------------------------
William G. Ferko
V. P. Finance - CFO & Treasurer
14