LANCASTER COLONY CORP
FORM 10-K (Annual Report)
Filed 9/22/1995 For Period Ending 6/30/1995
Address
37 W. BROAD STREET 5TH FLOOR COLUMBUS, Ohio 43215
Telephone
614-224-7141
CIK
0000057515
Industry
Food Processing
Sector
Consumer/Non-Cyclical
Fiscal Year
06/30
SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549
FORM 10-K (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, 1995 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from................. to ................. COMMISSION FILE NUMBER 0-4065-1
LANCASTER COLONY CORPORATION (Exact name of registrant as specified in its charter) OHIO 13-1955943 (State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
37 WEST BROAD STREET, COLUMBUS, OHIO (Address of principal executive offices) 614-224-7141 (Registrant's telephone number)
43215 (Zip Code)
Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to Section 12(g) of the Act: Title of each class COMMON STOCK--NO PAR VALUE PER SHARE (INCLUDING SERIES A PARTICIPATING PREFERRED STOCK PURCHASE RIGHTS) Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. 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 aggregate market value of Common Stock held by non-affiliates on September 1, 1995 was approximately $768,000,000. As of September 1, 1995, there were approximately 29,583,000 shares of Common Stock, no par value per share, outstanding. DOCUMENTS INCORPORATED BY REFERENCE Portions of the following documents are incorporated by reference to this annual report: Registrant's 1995 Annual Report to Shareholders Parts I and II. Proxy Statement for the Annual Meeting of Shareholders to be held November 20, 1995; to be filed - Part III. The 1995 Annual Report to Shareholders and 1995 Proxy Statement shall be deemed to have been "filed" only to the extent portions thereof are expressly incorporated by
reference. EXHIBIT INDEX ON PAGE 12. 1
PART I Item 1. Business General Development of Business Lancaster Colony Corporation was reincorporated in Ohio effective January 2, 1992. Prior to this date Lancaster Colony Corporation had been a Delaware Corporation organized in 1961. As used herein the term "registrant," unless the context otherwise requires, refers to Lancaster Colony Corporation and its subsidiaries. Description of and Financial Information About Business Segments The registrant operates in three business segments - specialty foods, automotive, and glassware and candles - which accounted for approximately 39%, 31% and 30%, respectively, of consolidated net sales for the fiscal year ended June 30, 1995. The financial information relating to business segments for the three years ended June 30, 1995, appearing in Exhibit 13 in this Form 10-K Annual Report, is incorporated herein by reference. Further description of each business segment the registrant operates within is provided below. Specialty Foods The food products manufactured and sold by the registrant include salad dressings and sauces marketed under the brand names "Marzetti," "Pfeiffer" and "Girard's"; frozen unbaked pies marketed under the brand names "Mountain Top" and "Reames"; hearth-baked frozen breads marketed under the brand name "New York Frozen Foods"; refrigerated chip and produce dips, dairy snacks and desserts marketed under the brand names "Oak Lake Farms," "Allen" and/or "Marzetti"; premium dry egg noodles marketed under the brand names "Inn Maid" and "Amish Kitchen"; frozen specialty noodles, pastas, and breaded specialty items marketed under the brand name "Reames" and caviar marketed under the brand name "Romanoff" and "Poriloff." The salad dressings and sauces are manufactured in Columbus, Ohio; Wilson, New York; Atlanta, Georgia and Milpitas, California. The dressings are sold in various metropolitan areas with sales being made both to retail and foodservice markets. The frozen unbaked pies are marketed principally in the midwestern United States through salesmen and food brokers to institutional distributors and retail outlets. A significant portion of the frozen bread sales is directed to the foodservice market. The refrigerated chip and produce dips, dairy snacks and desserts are sold through food brokers and distributors in most major markets in the United States. The dry egg noodles are marketed by brokers principally in Ohio, Michigan, Indiana and Kentucky. The "Reames" line is sold through brokers and distributors in various metropolitan areas principally in the central and midwestern United States. This segment is not dependent upon a single customer or a few customers, the loss of any one or more of which would have a significant adverse effect on operating results. Although the Company is a leading producer of salad dressings, all of the markets in which the registrant sells food products are highly competitive in the areas of price, quality and customer service. During fiscal year 1995, the registrant obtained adequate supplies of raw materials for this segment. 2
The registrant's firm order backlog at June 30, 1995, in this business segment, was approximately $4,238,000 as compared to a backlog of approximately $3,089,000 as of the end of the preceding fiscal year. It is expected that all of these orders will be filled during the current fiscal year. The operations of this segment are not affected to any material extent by seasonal fluctuations. The registrant does not utilize any franchises or concessions in this business segment. The trade names under which it operates are significant to the overall success of this segment. However, the patents and licenses under which it operates are not essential to the overall success of this segment. Automotive The registrant manufactures and sells a complete line of rubber, vinyl and carpeted car mats both in the aftermarket and to original equipment manufacturers. Other products are pickup truck bed mats, running boards, bed liners and other accessories for pickup trucks and vans, truck and trailer splash guards and quarter fenders, accessories such as cup holders, litter caddies and oil drain pans and funnels. The automotive aftermarket products are marketed primarily through mass merchandisers and automotive outlets under the name "Rubber Queen" and the registrant sells bed liners under the "Protecta" trademark, running boards under the "Dee Zee" name, as well as under private labels. Although minor, rubber matting sales are also included in this segment. The aggregate sales of two customers accounted for approximately 32% of this segment's total net sales during 1995 and 1994. No other customer accounted for more than 10% of this segment's total net sales. Although the Company is a market leader in many of its product lines, all the markets in which the registrant sells automotive products are highly competitive in the areas of design, price, quality and customer service. During fiscal year 1995, the registrant obtained adequate supplies of raw materials for this segment. The registrant's firm order backlog at June 30, 1995, in this business segment, was approximately $6,594,000 as compared to a backlog of approximately $12,503,000 as of the end of the preceding fiscal year. It is expected that all of these orders will be filled during the current fiscal year. The operations of this segment are not affected to any material extent by seasonal fluctuations. The registrant does not utilize any significant franchises or concessions in this segment. The patents, trademarks and licenses under which it operates are generally not essential to the overall success of this segment. Glassware and Candles Glass products include a broad range of machine pressed and machine blown consumer glassware and technical glass products such as cathode ray tubes, lighting components, lenses and silvered reflectors. Consumer glassware includes a diverse line of decorative and ornamental products such as tumblers, bowls, pitchers, jars and barware. These products are marketed under a variety of trademarks, the most important of which are "Indiana Glass," "Tiara," "Colony" and "Fostoria." The registrant also purchases domestic and imported blown glassware which is sold through Colony, a marketing division, and some domestic handcrafted ware sold through its Tiara home party marketing plan. Glass vases and containers are sold both in the retail and wholesale florist markets under the trade name "Brody" as well as under private label. Candles of all sizes, forms and scents are primarily sold in the mass merchandise markets as well as to supermarkets, drug stores and specialty shops under the name "Candle-lite." A portion of the registrant's candle business is marketed under private label. 3
The registrant's glass products are sold to discount, department, variety and drug stores, as well as to jobbers and directly to retail customers. Commercial markets such as foodservice, hotels, hospitals and schools are also served by this segment's products. All the markets in which the registrant sells houseware products are highly competitive in the areas of design, price, quality and customer service. Sales of glassware and candles to one customer accounted for approximately 17% and 12% of this segment's total net sales during 1995 and 1994, respectively. No other customer accounted for more than 10% of this segment's total net sales. During fiscal year 1995, the registrant obtained adequate supplies of raw materials for this business segment. The registrant's firm order backlog at June 30, 1995, in this business segment, was approximately $33,896,000 as compared to approximately $24,229,000 as of the end of the preceding fiscal year. It is expected that all of these orders will be filled during the current fiscal year. Seasonal retail stocking patterns cause certain of this segment's products to experience increased sales in the first half of the fiscal year. The registrant does not use any franchises or concessions in this segment. The patents and licenses under which it operates are not essential to the overall success of this segment. However, certain trademarks are important to this segment's marketing efforts. Net Sales by Class of Products The following table sets forth business segment information with respect to the percentage of net sales contributed by each class of similar products which accounted for at least 10% of the Company's consolidated net sales in any fiscal year from 1993 through 1995. 1995 1994 1993 -----------------------------------------------------------------------Specialty Foods: Retail 22% 25% 26% Foodservice 17% 15% 14% Automotive 31% 33% 32% Glassware and Candles: Consumer Table and Giftware 25% 22% 22%
General Business Research and Development The estimated amount spent during each of the last three fiscal years on research and development activities determined in accordance with generally accepted accounting principles is not considered material. Environmental Matters Certain of the registrant's operations are subject to compliance with various air emission standards promulgated under Title V of the Federal Clean Air Act. The effective date of compliance with such standards is scheduled to occur in the registrant's fiscal year ending June 30, 1996. The registrant is currently developing a compliance strategy to submit to the related Federal agency for approval. Based upon available information, compliance with the Federal Clean Air Act provisions, as well as other various Federal, state and local environmental protection laws and regulations, is not expected to have a material adverse effect upon the level of capital expenditures, earnings or the competitive position of the registrant for the remainder of the current and succeeding fiscal year. See also Item 3 for discussions relating to environmental matters. Employees The registrant has approximately 6,000 employees. 4
Foreign Operations and Export Sales Financial information relating to foreign operations and export sales have not been significant in the past and are not expected to be significant in the future based on existing operations. Item 2. Properties The registrant uses approximately 5,907,000 square feet of space for its operations. Of this space, approximately 1,922,000 square feet are leased. The following table summarizes facilities exceeding 75,000 square feet of space and which are considered the principal manufacturing and warehousing operations of the registrant:
Location -------Blue Ash, OH (1) Cincinnati, OH(2) Columbus, OH(3) Coshocton, OH Des Moines, IA (4) Dunkirk, IN Elkhart, IN Jackson, OH LaGrange, GA Lancaster, OH Leesburg, OH Milpitas, CA (5) Muncie, IN Newark, OH(2) Newport, TN (6) Sapulpa, OK (7) Wapakoneta, OH (8) Waycross, GA Wilson, NY
Business Segment(s) ------------------Glassware and Candles Glassware and Candles Specialty Foods Automotive Automotive Glassware and Candles Automotive Automotive and Glassware and Candles Automotive Glassware and Candles Glassware and Candles Specialty Foods Glassware and Candles Automotive Automotive Glassware and Candles Automotive Automotive Specialty Foods
Approximate Square Feet ----------200,000 139,700 277,788 591,400 392,000 933,700 96,000 223,000 207,000 465,300 297,900 130,400 153,000 75,000 82,000 668,500 178,100 122,500 80,000
(1)
Leased for term expiring 1996.
(2)
Leased on monthly basis.
(3)
Part leased for term expiring 1997. Part leased for term expiring 1998.
(4)
Part subject to capital lease expiring 1996.
(5)
Part leased for term expiring 1997.
(6)
Leased for term expiring 1996.
(7)
Part leased for term expiring in 1999.
(8)
Part leased for term expiring 2003 with ownership passing to registrant at lease expiration. basis.
Part leased for term expiring 1995.
5
Part leased for term expiring 1996.
Part leased on monthly
Item 3. Legal Proceedings On January 28, 1991, a cost recovery action under Section 107 of the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA") was filed against Pretty Products, Inc. ("Pretty Products") and the registrant in the United States District Court ("Court") for the Southern District of Ohio in a proceeding styled United States vs. Pretty Products, et al. The complaint sought recovery of response costs allegedly incurred or to be incurred by the United States Environmental Protection Agency ("EPA") in connection with the cleanup of the Coshocton City Landfill. During the second quarter of fiscal 1995, the parties reached a settlement for all claims in an amount totaling $1,750,000 plus interest from July 1, 1994. The settlement was approved and entered by the Court on January 4, 1995 and the registrant paid approximately $1,800,000 in February 1995 to the EPA as settlement of this obligation. Of this settlement, $1,700,000 had been accrued by the registrant as of June 30, 1994, with the balance recognized in the second quarter of fiscal 1995. Item 4. Submission of Matters to a Vote of Security Holders None EXECUTIVE OFFICERS OF THE REGISTRANT Pursuant to General Instruction G(3) of Form 10-K, the following list is included as an unnumbered item in Part I of this Report in lieu of being included in the Proxy Statement for the Annual Meeting of Shareholders to be held November 20, 1995. The following is a list of names and ages of all of the executive officers of the registrant indicating all positions and offices with the registrant held by such person and each person's principal occupation or employment during the past five years. No person other than those listed below has been chosen to become an executive officer of the registrant.
Age as of September 1 1995 ----------68
Name ---John B. Gerlach
John L. Boylan
40
John B. Gerlach, Jr.
Larry G. Noble
Offices and Positions Held -------------Chairman and Chief Executive Officer
41
59
First Elected an Executive Officer ---------
1961
Treasurer and Assistant Secretary
1990
President, Chief Operating Officer and Secretary
1982
Vice President
1985
The above named officers were re-elected to their present position at the annual meeting of the Board of Directors on November 21, 1994. All such persons have been elected to serve until the next annual election of officers, which shall occur on November 20, 1995 and their successors are elected or until their earlier resignation or removal. John B. Gerlach, Jr. is the son of John B. Gerlach. 6
PART II Item 5. Market for the Registrant's Common Stock and Related Stockholder Matters Reference is made to the "Selected Quarterly Financial Data", appearing in Exhibit 13 of this Form 10-K Annual Report, for information concerning market prices and related security holder matters on the registrant's common shares during 1995 and 1994. Such information is incorporated herein by reference. Item 6. Selected Financial Data The presentation of selected financial data as of and for the five years ended June 30, 1995 is included in the "Operations" and "Financial Position" sections of the "Five Year Financial Summary" appearing in Exhibit 13 of this Form 10-K Annual Report and is incorporated herein by reference. Item 7. Management's Discussion and Analysis of Results of Operations and Financial Condition Reference is made to the "Management's Discussion and Analysis of Results of Operations and Financial Condition" appearing in Exhibit 13 of this Form 10-K Annual Report. Such information is incorporated herein by reference. Item 8. Financial Statements and Supplementary Data The financial statements and supplementary financial information are set forth in Exhibit 13 of this Form 10-K Annual Report and are incorporated herein by reference. Item 9. Disagreements on Accounting and Financial Disclosure None PART III Item 10. Directors and Executive Officers of the Registrant For information with respect to the executive officers of the registrant, see "Executive Officers of the Registrant" at the end of Part I of this report. For information with respect to the Directors of the registrant, see "Nomination and Election of Directors" in the Proxy Statement for the Annual Meeting of Shareholders to be held November 20, 1995, which is incorporated herein by reference. Item 11. Executive Compensation Information set forth under the caption "Executive Compensation" in the Proxy Statement for the Annual Meeting of Shareholders to be held November 20, 1995 is incorporated herein by reference. Item 12. Security Ownership of Certain Beneficial Owners and Management Information set forth under the captions "Nomination and Election of Directors" and "Security Ownership of Certain Beneficial Owners" in the Proxy Statement for the Annual Meeting of Shareholders to be held November 20, 1995 is incorporated herein by reference. Item 13. Certain Relationships and Related Transactions For information with respect to certain transactions with Directors of the registrant, see "Other Transactions" in the Proxy Statement for the Annual Meeting of Shareholders to be held November 20, 1995, which is incorporated herein by reference. 7
PART IV Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K (a) 1. Financial Statements The consolidated financial statements as of June 30, 1995 and 1994 and for each of the three years in the period ended June 30, 1995, together with the report thereon of Deloitte & Touche LLP dated August 29, 1995, appearing in Exhibit 13 of this Form 10-K Annual Report are incorporated herein by reference. Index to Financial Statements Consolidated Statements of Income for the years ended June 30, 1995, 1994 and 1993 Consolidated Balance Sheets at June 30, 1995 and 1994 Consolidated Statements of Cash Flows for the years ended June 30, 1995, 1994 and 1993 Consolidated Statements of Shareholders' Equity for the years ended June 30, 1995, 1994 and 1993 Notes to Consolidated Financial Statements Independent Auditors' Report (a) 2. Financial Statement Schedules Required by Items 8 and 14(d) Included in Part IV of this report is the following additional financial data which should be read in conjunction with the consolidated financial statements in the 1995 Annual Report to Shareholders: Independent Auditors' Report Schedule II - Valuation and Qualifying Accounts for each of the three years ended June 30, 1995 Supplemental schedules not included with the additional financial data have been omitted because they are not applicable or the required information is shown in the financial statements or notes thereto. (a) 3. Exhibits Required by Item 601 of Regulation S-K and Item 14(c) See Index to Exhibits attached. (b) Reports on Form 8-K No reports on Form 8-K were filed during the fourth quarter of the year ended June 30, 1995. 8
SIGNATURES Pursuant to the requirements of Section 13 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 on this 21st day of September, 1995. LANCASTER COLONY CORPORATION (Registrant) By /S/ John B. Gerlach -------------------John B. Gerlach Chairman, Chief Executive Officer and Principal Financial 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 the capacities and on the dates indicated. Signatures ---------/S/ John B. Gerlach --------------------------John B. Gerlach
Title ----Chairman, Chief Executive Officer and Principal Financial Officer
Date ---September 21, 1995 ------------------
/S/ John B. Gerlach, Jr. --------------------------John B. Gerlach, Jr.
President, Chief Operating Officer and Secretary
September 19, 1995 ------------------
/S/ John L. Boylan --------------------------John L. Boylan
Treasurer, Assistant Secretary and Principal Accounting Officer
September 18, 1995 ------------------
Director --------------------------Frank W. Batsch /S/ Robert L. Fox --------------------------Robert L. Fox
------------------
Director
September 14, 1995 ------------------
Director --------------------------Morris S. Halpern
------------------
/S/ Robert S. Hamilton --------------------------Robert S. Hamilton
Director
September 16, 1995 ------------------
/S/ Edward H. Jennings --------------------------Edward H. Jennings
Director
September 15, 1995 ------------------
/S/ Richard R. Murphey, Jr. --------------------------Richard R. Murphey, Jr.
Director
September 14, 1995 ------------------
/S/ Henry M. O'Neill, Jr. --------------------------Henry M. O'Neill, Jr.
Director
September 18, 1995 ------------------
/S/ David J. Zuver --------------------------David J. Zuver
Director
September 14, 1995 ------------------
9
INDEPENDENT AUDITORS' REPORT To the Directors and Shareholders of Lancaster Colony Corporation: We have audited the consolidated financial statements of Lancaster Colony Corporation and its subsidiaries as of June 30, 1995 and 1994, and for each of the three years in the period ended June 30, 1995, and have issued our report thereon dated August 29, 1995; such financial statements and report are included in your 1995 Annual Report to Shareholders and are incorporated herein by reference. Our audits also included the consolidated financial statement schedule of Lancaster Colony Corporation and its subsidiaries, listed in Item 14. This financial statement schedule is the responsibility of the Company's management. Our responsibility is to express an opinion based on our audits. In our opinion, such consolidated financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly in all material respects the information set forth therein. /S/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP Columbus, Ohio August 29, 1995 10
SCHEDULE II
LANCASTER COLONY CORPORATION AND SUBSIDIARIES =============================
VALUATION AND QUALIFYING ACCOUNTS FOR THE THREE YEARS ENDED JUNE 30, 1995 --------------------------------------------------------------------------------------------------------------------COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E -----------------------------------ADDITIONS BALANCE AT CHARGED TO BALANCE BEGINNING COSTS AND AT END DESCRIPTION OF YEAR EXPENSES DEDUCTIONS OF YEAR ---------------------------------------------------------------------------------------------------------------------RESERVES DEDUCTED FROM ASSET TO WHICH THEY APPLY - Allowance for doubtful accounts:
(A)
Year ended June 30, 1993.................
$1,885,000 $2,096,000 $1,111,000(A) $2,870,000 ========================================================================
Year ended June 30, 1994.................
$2,870,000 $1,029,000 $1,560,000(A) $2,339,000 ========================================================================
Year ended June 30, 1995.................
$2,339,000 $ 614,000 $1,006,000(A) $1,947,000 ========================================================================
Represents uncollectible accounts written off net of recoveries.
11
LANCASTER COLONY CORPORATION FORM 10-K JUNE 30, 1995 INDEX TO EXHIBITS Exhibit Number ------3.1
.2
.3
4.1 .2
10.1 .2
.3
.4
.5
.6
.7
Description ----------Certificate of Incorporation of the registrant approved by the shareholders November 18, 1991.
Located at ------------(a)
By-laws of the registrant as amended through November 18, 1991.
(a)
Certificate of Designation, Rights and Preferences of the Series A Participating Preferred Stock of Lancaster Colony Corporation.
(b)
Specimen Certificate of Common Stock.
(i)
Rights Agreement dated as of April 20, 1990 between Lancaster Colony Corporation and The Huntington Trust Company, N.A.
(c)
1981 Incentive Stock Option Plan.
(d)
Resolution by the Board of Directors to amend registrant's 1981 Incentive Stock Option Plan, approved by the shareholders November 21, 1983.
(e)
Resolution by the Board of Directors to amend registrant's 1981 Incentive Stock Option Plan approved by the shareholders November 18, 1985.
(f)
Employee Stock Ownership Plan and Trust Agreement.
(g)
Resolution by the Board of Directors to amend registrant's 1981 Incentive Stock Option Plan approved by the shareholders November 19, 1990.
(h)
Key Employee Severance Agreement between Lancaster Colony Corporation and John L. Boylan.
(h)
Consulting Agreement by and between Lancaster Colony Corporation and Morris S. Halpern.
(j)
13.
Annual Report to Shareholders.
1995 Form 10-K
21.
Significant Subsidiaries of Registrant.
1995 Form 10-K
23.
The consent of Deloitte & Touche LLP to the incorporation by reference in Registration Statement No. 33-39102 on Form S-8 of their reports dated August 29, 1995, appearing in this Annual Report on Form 10-K of Lancaster Colony Corporation for the year ended June 30, 1995.
1995 Form 10-K
Financial Data Schedule
1995 Form 10-K
27.
12
(a)
Indicates the exhibit is incorporated by reference from filing as an annex to the proxy statement of Lancaster Colony Corporation for the annual meeting of stockholders held November 18, 1991.
(b)
Indicates the exhibit is incorporated by reference from filing as an exhibit to the Lancaster Colony Corporation report on Form 10-Q for the quarter ended March 31, 1990.
(c)
Indicates the exhibit is incorporated by reference from filing as an exhibit to the Lancaster Colony Corporation report on Form 8-K filed April 20, 1990.
(d)
Indicates the exhibit is incorporated by reference from filing as an exhibit to the Lancaster Colony Corporation report on Form 10-K for the year ended June 30, 1982.
(e)
Indicates the exhibit is incorporated by reference from filing as an exhibit to the Lancaster Colony Corporation report on Form 10-K for the year ended June 30, 1984.
(f)
Indicates the exhibit is incorporated by reference from filing as an exhibit to the Lancaster Colony Corporation report on Form 10-K for the year ended June 30, 1985.
(g)
Indicates the exhibit is incorporated by reference from filing as an exhibit to the Lancaster Colony Corporation report on Form 10-K for the year ended June 30, 1987.
(h)
Indicates the exhibit is incorporated by reference from filing as an exhibit to the Lancaster Colony Corporation report on Form 10-K for the year ended June 30, 1991.
(i)
Indicates the exhibit is incorporated by reference from filing as an exhibit to the Lancaster Colony Corporation report on Form 10-K for the year ended June 30, 1992.
(j)
Indicates the exhibit is incorporated by reference from filing as an exhibit to the Lancaster Colony Corporation report on Form 10-K for the year ended June 30, 1993.
Note(1)
The registrant and certain of its subsidiaries are parties to various long-term debt instruments. The amount of securities authorized under such debt instruments does not, in any case, exceed 10% of the total assets of the registrant and its subsidiaries on a consolidated basis. The registrant agrees to furnish a copy of any such long-term debt instrument to the Commission upon request.
Note(2)
The registrant has included in Exhibit 13 only the specific Financial Statements and notes thereto of its 1995 Annual Report to Shareholders which are incorporated by reference in this Form 10-K Annual Report. The registrant agrees to furnish a complete copy of its 1995 Annual Report to Shareholders to the Commission upon request.
13
Exhibit 13 LANCASTER COLONY CORPORATION 1995 ANNUAL REPORT MANAGEMENT'S DISCUSSION AND ANALYSIS of Results of Operations and Financial Condition REVIEW OF CONSOLIDATED OPERATIONS For its fiscal year ended June 30, 1995, Lancaster Colony Corporation again achieved record levels of net sales and net income. Net sales of $795,126,000 in the most recent year increased 10% over 1994 levels while net income of $70,524,000 increased 18%. The previous record totals of net sales and net income were attained by the Company in fiscal 1994 and such totals increased by 14% and 29%, respectively, over the comparable amounts reported for fiscal 1993. During the last two years, each of the three operating segments have achieved net sales increases with the Glassware and Candles segment providing the greatest impetus to the growth of consolidated operating income. Over the past five years, the Company's consolidated net sales and net income have grown at compounded annual rates of 10% and 34%, respectively. The relative proportion of sales and operating income contributed by each of the Company's operating segments can impact a year-to-year comparison of the consolidated statements of income. The following table summarizes the sales mix and related operating income percentages achieved by the operating segments over each of the last three years: SEGMENT SALES MIX(1): 1995 1994 1993 ------------------------------------------------------------------------------------Specialty Foods 39% 40% 40% Automotive 31% 33% 32% Glassware and Candles 30% 27% 28% OPERATING INCOME(2): ------------------------------------------------------------------------------------Specialty Foods 13% 15% 15% Automotive 11% 13% 12% Glassware and Candles 22% 16% 12% (1) Expressed as a percentage of consolidated net sales. (2) Expressed as a percentage of the related segment's net sales.
On a consolidated basis, the Company's gross profit margin in 1995 declined to 31.2% of net sales compared to 32.2% attained in both 1994 and 1993. The current year decrease resulted from a less favorable sales mix and continued high material costs present within the Specialty Foods segment, as well as increases incurred in raw material costs within the Automotive segment. These factors were partially offset by higher margins being present in the Glassware and Candles segment that resulted from an improved sales mix and better manufacturing efficiencies. Gross margins reported for 1994 were favorably affected by an improved sales mix and productivity improvements although these factors were moderated by significantly higher material costs occurring within the Specialty Foods segment. As a percentage of net sales, the Company's selling, general and administrative expenses have declined from 19.8% in fiscal 1993 to 18.2% in 1994 and 16.5% in 1995. This decline resulted from the effects of greater sales volume, a changing sales mix and also the Specialty Foods segment's curtailment of selected promotional activities which occurred in the latter half of fiscal 1994 and continued throughout fiscal 1995. Operating income of $116,518,000 for 1995 increased 16% over the comparable 1994 total of $100,668,000. Greater sales volume and improved operating margins in the Glassware and Candles segment were largely responsible for this improvement. Increased sales and improved operating efficiencies permitted 1994 operating income to increase 29% over 1993 levels. Stated as a percentage of income before income taxes, the Company's effective tax rate of 39% remained unchanged compared to 1994. The effective rate for 1993 was 38%. The increased rate over the last two years principally reflects the 1% increase in the Federal statutory rate enacted by law in August 1993. The 1994 expense also includes a charge of $343,000 for the retroactive provisions of the legislation enacting this tax increase.
SEGMENT REVIEW - SPECIALTY FOODS For fiscal 1995, net sales within the Specialty Foods segment of $309,622,000 rose 7% over the 1994 total of $289,734,000. This increase resulted from greater sales to foodservice customers stemming from the acquisition of new accounts as well as the expansion of existing relationships. Sales to foodservice accounts now comprise approximately 44% of this segment's total sales compared to 38% in 1994. Retail sales in 1995 were assisted by selected product line extensions, although such sales were adversely impacted by factors such as increased lettuce costs paid by consumers during the latter half of 1995 as well as heightened competition present in certain of this segment's markets. Net sales in 1994 were 15% above 1993 sales of $252,288,000. Leading this growth was the segment's continued geographic expansion of both its retail and foodservice sales across the United States and Canada. New foodservice accounts assisted this growth as did the July 1993 acquisition of Romanoff caviar and related product lines. This segment's 1995 operating income of $40,704,000 declined 4% from the 1994 level of $42,542,000. As a percentage of net sales, such income also declined from 15% to 13%. In general, the segment's increasing proportion of foodservice sales has tended to lower operating margins as such sales typically provide lower margins than that provided by retail sales. Margins have also been adversely affected by higher costs for several raw materials and an increase in competitive pricing pressures.
In comparison to fiscal 1993, fiscal 1994 operating income increased 11% primarily reflecting higher sales volume. Increases in soybean oil costs were minimized by the reduction of certain promotional activities as well as by the implementation of selected price increases. Over the last five years, net sales and operating income of the Specialty Foods segment have grown at respective annual compound growth rates of 14% and 12%. In addition to exploring ways to further increase this segment's sales volume, including through complementary strategic business acquisitions, management will continue to consider opportunities to more efficiently manufacture and distribute products throughout fiscal 1996. SEGMENT REVIEW - GLASSWARE AND CANDLES Annual sales growth within the Glassware and Candles segment totaled 21% in 1995 and 12% in 1994. Total net sales reached $237,320,000 in 1995 compared to $196,711,000 in 1994 and $175,260,000 in 1993. Leading this segment's growth throughout this period has been the sale of candle products, particularly wax-filled glass items. Net sales for 1994 also reflected improved industrial glassware volumes as influenced by improving economic conditions. Operating income for 1995 rose 66% to $52,147,000 compared to $31,353,000 in 1994 and $20,546,000 in 1993. This segment's sales over the last two years have trended toward a mix of higher-margined products. The segment's significant sales growth has also provided for significant volume-driven efficiencies that have been further magnified by the acquisition of more efficient manufacturing equipment. An additional factor contributing to this trend has been the more efficient loading of the glass factories resulting from the manufacture of glass components utilized in the production of the wax-filled glass lines.
SEGMENT REVIEW - AUTOMOTIVE Net sales of $248,184,000 for the Automotive segment for 1995 increased by 5% from the $235,287,000 recorded in 1994. During 1994, net sales increased by 16% over the 1993 net sales of $203,079,000. Each of the last two years has benefited by a trend of growth in domestic new vehicle sales which continued into the first half of fiscal 1995. Sales of the Company's line of truck and van accessories were particularly strong due to the increasing popularity of these vehicles. Specifically contributing to the 1995 increase were greater sales of aluminum accessories to original equipment manufacturers, cost-driven increases in selling prices and a greater sales volume of heavy truck accessories. This segment's operating income totaled $28,027,000 in 1995 compared to $31,305,000 in 1994 and $24,280,000 in 1993. The most recent year was adversely affected by significant cost increases in a number of raw materials including plastic resins, aluminum, corrugated and rubberrelated products. Where it has been competitively possible, price increases have been implemented to offset the effects of these higher costs, but such increases have generally lagged in time and amount the impact of the rise in costs. Sales of the Automotive segment will continue to face significant market competition and generally remain sensitive to the level of domestic new vehicle sales. As noted in prior years, restrictive pricing programs present in the ongoing relationships with most original equipment manufacturers make it difficult to improve operating margins through increased pricing.
LIQUIDITY AND CAPITAL RESOURCES The Company's financial position in recent years has clearly benefited from the continuing increases in profitability. Just five years ago, longterm debt as a percentage of shareholders' equity was 47% compared to 11% at June 30, 1995. This improvement developed during a period of time in which return on average equity also increased from 12% in 1990 to over 27% in 1995 despite shareholders' equity having more than doubled. Cash generated from operating activities during 1995 totaled $46,725,000 compared to $61,092,000 in 1994. Although net income increased from $59,860,000 to $70,524,000 in this period, an increase in net working capital of $25,709,000 was required, in part, to support the recent strong growth of the Glassware and Candles segment. This segment typically begins to build seasonal inventories in early summer that are shipped during the fall. Automotive inventories also increased somewhat as influenced by rising material costs and scheduling considerations. The Company's investment in capital expenditures reached record levels in 1995 and totaled $31,745,000 compared to $23,532,000 in 1994. It is anticipated that fiscal 1996 expenditures will exceed that of the past year. This increase will largely result from continuing plans of the Glassware and Candles segment to significantly expand capacity, improve certain manufacturing processes and, with respect to the candle facility in Leesburg, Ohio, also enlarge and enhance distribution capabilities. Additionally, if considered of strategic value, the Company will continue to invest in the acquisition of businesses which are considered complementary in function to that of existing product lines. The Company's financing activities during 1995 included treasury share purchases of $17,814,000 compared to $7,718,000 in 1994. The corporate benefit of further treasury share purchases will be evaluated from time to time by management and the Company's Board of Directors. In a transaction consummated in August 1995, the Company reacquired 250,000 common shares for a total purchase price of $8,952,000. Also of significance to the Company's financing activities was the Company's increased dividend rate during 1995 of $.55 per share compared to $.44 in 1994. This higher rate served to increase total dividends paid during 1995 by 23% over 1994 levels. Management anticipates that cash flows from operations, combined with the occasional use of short-term borrowings available under discretionary bank lines of credit, will be adequate to meet foreseeable cash requirements. With increasingly stringent environmental regulations being brought to bear upon the Company's operations, the Company will continue to incur costs for regulatory compliance and, upon occasion, remediation. The extent to which such costs are ongoing is generally difficult to estimate but, to date, the Company's expenditures in this area have not been material to the results of operations or financial condition. The future level of anticipated expenditure is not currently expected to increase materially from present levels. Reference is made to Note 12 to the accompanying financial statements for further discussion as to the accounting for such costs. IMPACT OF INFLATION During 1995, significant increases were noted in the cost of many raw materials, particularly those within the Automotive segment. In addition, higher corrugated packaging costs were prevalent throughout all segments. The margins of the Specialty Foods segment were affected during 1994 by increased average market prices for soybean oil, a primary ingredient in several product lines of this segment. Such market prices remained high during fiscal 1995 as well. The Company generally attempts to adjust its selling prices to offset the effects of increased raw material costs. However, these adjustments have historically been difficult to implement on a timely basis relative to the increase in costs incurred. Minimizing the exposure to such increased costs is the Company's diversity of operations and its ongoing efforts to achieve greater manufacturing and distribution efficiencies through the improvement of work processes.
FIVE YEAR FINANCIAL SUMMARY Lancaster Colony Corporation and Subsidiaries (Thousands Except Per Share Figures) 1995 1994 1993 1992 1991 -----------------------------------------------------------------------------------------------------------------------------------OPERATIONS Net Sales $795,126 $721,732 $630,627 $555,793 $500,475 Gross Margin $247,942 $232,096 $203,106 $175,226 $150,373 Percent of sales 31.2% 32.2% 32.2% 31.5% 30.0% Interest Expense $ 2,736 $ 2,849 $ 3,625 $ 5,584 $ 8,735 Percent of sales 0.3% 0.4% 0.6% 1.0% 1.7% Income Before Income Taxes $114,808 $ 98,093 $ 74,319 $ 53,852 $ 33,817(1) Percent of sales 14.4% 13.6% 11.8% 9.7% 6.8% Taxes Based on Income $ 44,284 $ 38,233 $ 28,094 $ 21,481 $ 12,623 Net Income $ 70,524 $ 59,860 $ 46,225 $ 32,371 $ 20,184(2) Percent of sales 8.9% 8.3% 7.3% 5.8% 4.0% Per Common Share:(3) Net income $ 2.35 $ 1.97 $ 1.52 $ 1.06 $ .65(2) Cash dividends $ 0.55 $ .44 $ .37 $ .32 $ .30 -----------------------------------------------------------------------------------------------------------------------------------FINANCIAL POSITION Total Assets $379,904 $355,445 $302,050 $289,951 $286,989 Working Capital $189,255 $163,546 $126,648 $ 97,007 $ 93,570 Property, Plant and Equipment-Net $113,187 $101,570 $ 98,597 $ 99,457 $ 98,139 Long-Term Debt $ 31,840 $ 32,933 $ 34,586 $ 39,984 $ 57,176 Property Additions $ 31,745 $ 23,532 $ 18,921 $ 17,040 $ 13,517 Provision for Depreciation $ 20,440 $ 20,145 $ 19,486 $ 18,821 $ 17,458 Shareholders' Equity $277,148 $236,847 $192,010 $159,416 $139,385 Per Common Share(3) $ 9.29 $ 7.83 $ 6.34 $ 5.25 $ 4.55 Weighted Average Common Shares Outstanding(3) 30,038 30,317 30,483 30,502 30,825 -----------------------------------------------------------------------------------------------------------------------------------STATISTICS Price-Earnings Ratio at Year End 15.2 18.0 18.9 15.5 11.9 Current Ratio 4.1 3.2 3.1 2.3 2.3 Long-Term Debt as a Percent of Shareholders' Equity 11.5% 13.9% 18.0% 25.1% 41.0% Dividends Paid as a Percent of Net Income 23.4% 22.3% 24.5% 30.5% 45.2% Return on Average Equity 27.4% 27.9% 26.3% 21.7% 15.0% -----------------------------------------------------------------------------------------------------------------------------------(1) Net of a pretax charge of $3,000 for a write-down related to property held for sale. (2) The year's income, before a charge for the cumulative effect of accounting changes of $1,010 or $.04 per share, totaled $21,194 or $.69 per share. (3) Adjusted for 4-for-3 stock splits paid July 1994 and April 1993 and the 3-for-2 stock split paid April 1992.
BUSINESS SEGMENTS For the Years Ended 1995, 1994 and 1993 The Company operates in three business segments - Specialty Foods, Automotive, and Glassware and Candles. The net sales of each segment are principally domestic, and no single customer accounts for 10% or more of consolidated net sales. A further description of each business segment follows: SPECIALTY FOODS-includes production and marketing of a family of pourable and refrigerated produce salad dressings, sauces, refrigerated produce vegetable dips, chip dips, dairy snacks and desserts, dry and frozen egg noodles, caviar, frozen ready-to-bake pies and frozen hearthbaked breads. The salad dressings, sauces and frozen bread products are sold to both retail and foodservice markets. The remaining products of this business segment are primarily directed to retail markets. AUTOMOTIVE-includes production and marketing of rubber, vinyl and carpet-on-rubber car mats both for original equipment manufacturers and importers and for the auto aftermarket; truck and trailer splash guards; pickup truck bed mats and liners; aluminum running boards for pickup trucks and vans; and a broad line of auto accessories. GLASSWARE AND CANDLES-includes the production and marketing of table and giftware consisting of domestic glassware, both machine pressed and machine blown, imported glassware and candles in all popular sizes, shapes and scents; industrial glass and lighting components; and glass floral containers. The Company's glass and candle products are sold primarily to mass merchandisers, discount and department stores. Operating income represents net sales less operating expenses related to the business segments. Expenses of a general corporate nature, including interest expense and income taxes, have not been allocated to business segments. Identifiable assets for each segment include those assets used in its operations and intangible assets allocated to purchased businesses. Corporate assets consist principally of cash, cash equivalents and deferred income taxes. The 1995 capital expenditures of the Specialty Foods and Automotive segments include property relating to business acquisitions totaling $36,000 and $1,500,000, respectively. The following sets forth certain financial information attributable to the Company's business segments for the three years ended June 30, 1995, 1994 and 1993: (Dollars in Thousands) 1995 1994 1993 ----------------------------------------------------------------------------------NET SALES Specialty Foods $ 309,622 $ 289,734 $ 252,288 Automotive 248,184 235,287 203,079 Glassware and Candles 237,320 196,711 175,260 ----------------------------------------------------------------------------------Total $ 795,126 $ 721,732 $ 630,627 ==================================================================================== OPERATING INCOME Specialty Foods $ 40,704 $ 42,542 $ 38,282 Automotive 28,027 31,305 24,280 Glassware and Candles 52,147 31,353 20,546 ----------------------------------------------------------------------------------Total 120,878 105,200 83,108 Corporate expenses (6,070) (7,107) (8,789) ----------------------------------------------------------------------------------Income Before Income Taxes $ 114,808 $ 98,093 $ 74,319 ==================================================================================== IDENTIFIABLE ASSETS Specialty Foods $ 79,297 $ 71,274 $ 59,933 Automotive 126,654 108,597 99,984 Glassware and Candles 155,484 136,789 118,498 Corporate 18,469 38,785 23,635 ----------------------------------------------------------------------------------Total $ 379,904 $ 355,445 $ 302,050 ==================================================================================== CAPITAL EXPENDITURES Specialty Foods $ 6,582 $ 4,516 $ 3,414 Automotive 9,473 7,419 6,857 Glassware and Candles 17,182 11,565 8,592 Corporate 44 32 58 ----------------------------------------------------------------------------------Total $ 33,281 $ 23,532 $ 18,921 ==================================================================================== DEPRECIATION AND AMORTIZATION Specialty Foods $ 4,439 $ 3,512 $ 3,199 Automotive 8,338 8,778 8,633 Glassware and Candles 9,802 10,027 9,913 Corporate 138 86 82 ----------------------------------------------------------------------------------Total $ 22,717 $ 22,403 $ 21,827
====================================================================================
CONSOLIDATED STATEMENTS OF INCOME Lancaster Colony Corporation and Subsidiaries For the Years Ended June 30, 1995, 1994 and 1993 Years Ended June 30 1995 1994 1993 ----------------------------------------------------------------------------------------------------------------------NET SALES $795,126,000 $721,732,000 $630,627,000 COST OF SALES 547,184,000 489,636,000 427,521,000 ----------------------------------------------------------------------------------------------------------------------GROSS MARGIN 247,942,000 232,096,000 203,106,000 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 131,424,000 131,428,000 125,079,000 ----------------------------------------------------------------------------------------------------------------------OPERATING INCOME 116,518,000 100,668,000 78,027,000 OTHER INCOME (EXPENSE): Interest expense (2,736,000) (2,849,000) (3,625,000) Interest income and other-net 1,026,000 274,000 (83,000) ----------------------------------------------------------------------------------------------------------------------INCOME BEFORE INCOME TAXES 114,808,000 98,093,000 74,319,000 TAXES BASED ON INCOME 44,284,000 38,233,000 28,094,000 ----------------------------------------------------------------------------------------------------------------------NET INCOME $ 70,524,000 $ 59,860,000 $ 46,225,000 ======================================================================================================================= NET INCOME PER COMMON SHARE $2.35 $1.97 $1.52 ======================================================================================================================= WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 30,038,000 30,317,000 30,483,000 ======================================================================================================================= See Notes to Consolidated Financial Statements
CONSOLIDATED BALANCE SHEETS Lancaster Colony Corporation and Subsidiaries As of June 30, 1995 and 1994 June 30 ASSETS 1995 1994 ---------------------------------------------------------------------------------------------------------------------------CURRENT ASSETS: Cash and equivalents $ 8,239,000 $ 30,423,000 Receivables (less allowance for doubtful accounts, 1995-$1,947,000; 1994-$2,339,000) 88,416,000 80,737,000 Inventories: Raw materials and supplies 34,020,000 27,614,000 Finished goods and work in process 107,866,000 90,034,000 ---------------------------------------------------------------------------------------------------------------------------Total inventories 141,886,000 117,648,000 Prepaid expenses and other current assets 11,226,000 8,995,000 ---------------------------------------------------------------------------------------------------------------------------Total current assets 249,767,000 237,803,000 PROPERTY, PLANT AND EQUIPMENT: Land, buildings and improvements 73,371,000 69,723,000 Machinery and equipment 209,154,000 194,974,000 ---------------------------------------------------------------------------------------------------------------------------Total cost 282,525,000 264,697,000 Less accumulated depreciation 169,338,000 163,127,000 ---------------------------------------------------------------------------------------------------------------------------Property, plant and equipment-net 113,187,000 101,570,000 OTHER ASSETS 16,950,000 16,072,000 ---------------------------------------------------------------------------------------------------------------------------TOTAL $379,904,000 $355,445,000 ============================================================================================================================ LIABILITIES AND SHAREHOLDERS' EQUITY ---------------------------------------------------------------------------------------------------------------------------CURRENT LIABILITIES: Current portion of long-term debt $ 1,026,000 $ 1,301,000 Accounts payable 26,322,000 31,054,000 Accrued liabilities 33,164,000 41,902,000 ---------------------------------------------------------------------------------------------------------------------------Total current liabilities 60,512,000 74,257,000 LONG-TERM DEBT-Less current portion 31,840,000 32,933,000 OTHER NONCURRENT LIABILITIES 8,223,000 8,093,000 DEFERRED INCOME TAXES 2,181,000 3,315,000 SHAREHOLDERS' EQUITY: Preferred stock-authorized 2,650,000 shares; Outstanding-none Common stock-authorized 35,000,000 shares; 28,086,000 25,437,000 Shares outstanding, 1995 - 29,829,000; 1994 - 22,674,020 Retained earnings 280,538,000 226,412,000 Foreign currency translation adjustment 501,000 440,000 ---------------------------------------------------------------------------------------------------------------------------Total 309,125,000 252,289,000 Less: Common stock in treasury, at cost 29,420,000 11,606,000 Amount due from ESOP 2,557,000 3,836,000 ---------------------------------------------------------------------------------------------------------------------------Total shareholders' equity 277,148,000 236,847,000 ---------------------------------------------------------------------------------------------------------------------------TOTAL $379,904,000 $355,445,000 ============================================================================================================================ See Notes to Consolidated Financial Statements
CONSOLIDATED STATEMENTS OF CASH FLOWS Lancaster Colony Corporation and Subsidiaries For the Years Ended June 30, 1995, 1994 and 1993 Years Ended June 30 1995 1994 1993 --------------------------------------------------------------------------------------------------------------------------CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 70,524,000 $59,860,000 $46,225,000 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 22,717,000 22,403,000 21,827,000 Provision for losses on accounts receivable 614,000 1,029,000 2,096,000 Deferred income taxes and other noncash charges (2,086,000) (437,000) 364,000 Loss on sale of property 235,000 254,000 83,000 Changes in operating assets and liabilities: Receivables (7,273,000) (13,792,000) (5,253,000) Inventories (23,475,000) (20,752,000) (2,542,000) Prepaid expenses and other current assets (1,061,000) 216,000 (1,232,000) Accounts payable and accrued liabilities (13,470,000) 12,311,000 165,000 --------------------------------------------------------------------------------------------------------------------------Net cash provided by operating activities 46,725,000 61,092,000 61,733,000 --------------------------------------------------------------------------------------------------------------------------CASH FLOWS FROM INVESTING ACTIVITIES: Payments on property additions (31,745,000) (23,532,000) (18,921,000) Acquisitions net of cash acquired (5,054,000) (5,438,000) Proceeds from sale of property 1,002,000 412,000 41,000 Other-net (1,420,000) (1,506,000) (1,022,000) --------------------------------------------------------------------------------------------------------------------------Net cash used in investing activities (37,217,000) (30,064,000) (19,902,000) --------------------------------------------------------------------------------------------------------------------------CASH FLOWS FROM FINANCING ACTIVITIES: Payment of dividends (16,486,000) (13,378,000) (11,336,000) Purchase of treasury stock (17,814,000) (7,718,000) (3,888,000) Payments on long-term debt (1,368,000) (2,149,000) (6,689,000) Reduction of ESOP debt 1,279,000 1,278,000 1,279,000 Common stock issued upon exercise of stock options including related tax benefits 2,649,000 4,865,000 501,000 Reduction of short-term bank loans (12,500,000) --------------------------------------------------------------------------------------------------------------------------Net cash used in financing activities (31,740,000) (17,102,000) (32,633,000) --------------------------------------------------------------------------------------------------------------------------Effect of exchange rate changes on cash 48,000 (5,000) (114,000) --------------------------------------------------------------------------------------------------------------------------Net change in cash and equivalents (22,184,000) 13,921,000 9,084,000 Cash and equivalents at beginning of year 30,423,000 16,502,000 7,418,000 --------------------------------------------------------------------------------------------------------------------------Cash and equivalents at end of year $ 8,239,000 $30,423,000 $16,502,000 =========================================================================================================================== See Notes to Consolidated Financial Statements
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY Lancaster Colony Corporation and Subsidiaries For the Years Ended June 30, 1995, 1994 and 1993
Outstanding Shares
Common Stock
Retained Earnings
Foreign Currency Translation Adjustment
Treasury Stock
Amount due from ESOP
-----------------------------------------------------------------------------------------------------------------------------------BALANCE, JUNE 30, 1992 17,088,936 $ 20,071,000 $ 144,861,000 $ 877,000 $ 0 $ 6,393,000 YEAR ENDED JUNE 30, 1993 : Net income 46,225,000 Cash dividends-common stock ($.3725 per share) (11,336,000) Purchase of treasury shares (114,000) 3,888,000 Shares issued upon exercise of stock options including related tax benefits 37,037 501,000 Shares issued in connection with four-for-three stock split 5,704,707 Cash paid in lieu of fractional shares in connection with four-for-three stock split (12,000) Tax benefit of cash dividends paid on ESOP unallocated shares 97,000 Reduction of ESOP debt (1,279,000) Translation adjustment (272,000) -----------------------------------------------------------------------------------------------------------------------------------BALANCE, JUNE 30, 1993 22,716,680 20,572,000 179,835,000 605,000 3,888,000 5,114,000 -----------------------------------------------------------------------------------------------------------------------------------YEAR ENDED JUNE 30, 1994 : Net income 59,860,000 Cash dividends-common stock ($.4425 per share) (13,378,000) Purchase of treasury shares (189,000) 7,718,000 Shares issued upon exercise of stock options including related tax benefits 146,340 4,865,000 Tax benefit of cash dividends paid on ESOP unallocated shares 95,000 Reduction of ESOP debt (1,278,000) Translation adjustment (165,000) -----------------------------------------------------------------------------------------------------------------------------------BALANCE, JUNE 30, 1994 22,674,020 25,437,000 226,412,000 440,000 11,606,000 3,836,000 -----------------------------------------------------------------------------------------------------------------------------------YEAR ENDED JUNE 30, 1995 : Net income 70,524,000 Cash dividends-common stock ($.55 per share) (16,465,000) Purchase of treasury shares (530,800) 17,814,000 Shares issued upon exercise of stock options including related tax benefits 130,026 2,649,000 Shares issued in connection with four-for-three stock split 7,555,754 Cash paid in lieu of fractional shares in connection with four-for-three stock split (21,000) Tax benefit of cash dividends paid on ESOP unallocated shares 88,000 Reduction of ESOP debt (1,279,000) Translation adjustment 61,000 -----------------------------------------------------------------------------------------------------------------------------------BALANCE, JUNE 30, 1995 29,829,000 $28,086,000 $280,538,000 $501,000 $29,420,000 $2,557,000 ==================================================================================================================================== See Notes to Consolidated Financial Statements
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Lancaster Colony Corporation and Subsidiaries 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES PRINCIPLES OF CONSOLIDATION The accompanying consolidated financial statements include the accounts of Lancaster Colony Corporation and its wholly-owned subsidiaries, collectively referred to as the "Company." All significant intercompany transactions have been eliminated. USE OF ESTIMATES The preparation of the consolidated statements of the Company in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, as well as their related disclosures. Such estimates and assumptions also affect the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. CASH EQUIVALENTS The Company considers all highly liquid investments purchased with maturities of three months or less to be cash equivalents. PROPERTY, PLANT AND EQUIPMENT The Company uses the straight-line method of computing depreciation for financial reporting purposes based on the estimated useful lives of the corresponding assets, which predominantly range from 5 to 40 years. For tax purposes, the Company generally computes depreciation using accelerated methods. OTHER ASSETS Included in other assets at June 30, 1995 is unamortized goodwill attributable to purchased companies totaling $13,761,000. Of this total, $11,518,000 (net of accumulated amortization of $3,757,000) relates to companies acquired after October 31, 1970, and is being amortized over fifteen to forty years. Goodwill of $2,243,000 relates to a company acquired prior to November 1, 1970, and is not being amortized as, in the opinion of management, there has been no diminution in value. The remaining other assets consist of deferred costs which are amortized over their estimated useful lives; costs of patents acquired which are amortized over their estimated remaining economic lives; and other miscellaneous assets. Management periodically evaluates the future economic benefit of its long-lived intangible assets based upon expected undiscounted cash flows of the related assets and appropriately adjusts those items which are determined to have been impaired. REVENUE RECOGNITION Net sales and related cost of sales are recognized upon shipment of products. Net sales are recorded net of estimated sales discounts and returns. PER SHARE INFORMATION Net income per common share is computed based on the weighted average number of shares of common stock and common stock equivalents (stock options) outstanding during each period. On July 20, 1994 and April 15, 1993, a four-for-three stock split was effected whereby one additional common share was issued for each three shares outstanding to shareholders of record on June 20, 1994 and March 15, 1993, respectively. Accordingly, net income per common share and all other per share information appearing in the consolidated financial statements and notes thereto have been retroactively adjusted for these splits where appropriate. CREDIT RISK Financial instruments which potentially subject the Company to concentrations of credit risk consist primarily of cash equivalents and trade accounts receivable. The Company places its cash equivalents with high-quality institutions and, by policy, limits the amount of credit exposure to any one institution. Concentration of credit risk with respect to trade accounts receivable is not material, as the Company has a large diverse customer base with no single customer accounting for a significant percentage of trade accounts receivable. BUSINESS SEGMENTS
The business segments information for 1995, 1994 and 1993 included on page 9 of this Annual Report is an integral part of these financial statements.
2. ACQUISITIONS During fiscal 1995 and 1994 the Company acquired for cash the net operating assets of various entities as follows: Business Segment 1995 1994 -----------------------------------------------------------------------(Dollars in Thousands) Automotive $ 4,500 Specialty Foods 554 $ 5,438 -----------------------------------------------------------------------Total $ 5,054 $ 5,438 ========================================================================
All such acquisitions were accounted for under the purchase method of accounting. The results of operations of these entities have been included in the consolidated financial statements from the date of acquisition and are immaterial in relation to the consolidated totals. 3. INVENTORIES Inventories are valued at the lower of cost or market. Inventories which comprise approximately 25% of total inventories at June 30, 1995 and 1994 are costed on a last-in, first-out (LIFO) basis. Inventories which are costed by various other methods approximate actual cost on a first-in, first-out (FIFO) basis. If the FIFO method (which approximates current cost) of inventory accounting had been used for inventories costed on a LIFO basis, these inventories would have been $12,025,000 and $12,553,000 higher than reported at June 30, 1995 and 1994, respectively. It is not practicable to segregate work in process from finished goods inventories. Management estimates, however, that work in process inventories amount to 10% or less of the combined total of finished goods and work in process inventories at June 30, 1995 and 1994. 4. SHORT-TERM BANK LOANS Short-term bank loans (generally for terms not exceeding ninety days) represent unsecured borrowings under various credit arrangements. The Company had unused lines of credit for short-term borrowings from various banks at June 30, 1995, 1994 and 1993 of $154,000,000, $169,000,000 and $179,000,000, respectively. The lines of credit are granted at the discretion of the lending banks and are generally subject to periodic review. For the year ended June 30, 1995, the Company had no short-term borrowings under its line of credit arrangements. 5. ACCRUED LIABILITIES Accrued liabilities at June 30, 1995 and 1994 are composed of: 1995 1994 --------------------------------------------------------------------------------------(Dollars in Thousands) Income and other taxes $ 2,768 $ 8,010 Accrued compensation and employee benefits 19,533 17,879 Accrued marketing and distribution 4,724 6,399 Other 6,139 9,614 --------------------------------------------------------------------------------------Total accrued liabilities $33,164 $41,902 =======================================================================================
6. LONG-TERM DEBT Long-term debt (including current portion) at June 30, 1995 and 1994 consists of: 1995 1994 --------------------------------------------------------------------------------------(Dollars in Thousands) Notes payable (8.9%, due in February 2000) $25,000 $25,000 Obligations with various industrial development authorities-collateralized by real estate and equipment: Floating rate due in installments to 2005 5,890 6,623 7%, due in installments to 2003 1,500 1,640 Capital lease obligations (10.0% to 15.6%, due in installments to 1996) 405 841 Other (2% to 8.5%, due in installments to 1996) 71 130 --------------------------------------------------------------------------------------Total 32,866 34,234 Less current portion 1,026 1,301 --------------------------------------------------------------------------------------Long-term debt $31,840 $32,933
=======================================================================================
The net book value of property subject to lien at June 30, 1995 was approximately $3,100,000. The Company has entered into various capital lease agreements in connection with equipment used in its operations. Such equipment at June 30, 1995 and 1994 had a capitalized cost of approximately $1,866,000 and $2,028,000 and a related net book value of $220,000 and $507,000, respectively.
No material debt was assumed for the purchase of property additions in 1995, 1994 and 1993. Cash payments for interest were $2,739,000, $2,868,000 and $3,664,000 for 1995, 1994 and 1993, respectively. Various debt agreements require the maintenance of certain financial statement amounts and ratios, including a requirement to maintain a specified minimum net worth, as defined. At June 30, 1995, the Company exceeded this net worth requirement by approximately $79,310,000. Long-term debt, including capital leases, matures as follows: ------------------------------------------------------------------------------------------Year ending June 30: (Dollars in Thousands) 1996 $ 1,026 1997 610 1998 545 1999 650 2000 25,660 After 2000 4,375 ------------------------------------------------------------------------------------------Total $32,866 ===========================================================================================
Based on the borrowing rates currently available for long-term debt with similar terms and average maturities, the fair value of total long-term debt is approximately $34,566,000. 7. INCOME TAXES The Company and its domestic subsidiaries file a consolidated Federal income tax return. Taxes based on income have been provided as follows: 1995 1994 1993 -----------------------------------------------------------------------------------------------------Currently payable: (Dollars in Thousands) Federal $40,163 $35,441 $26,563 State and local 6,425 5,265 4,202 -----------------------------------------------------------------------------------------------------Total current provision 46,588 40,706 30,765 Deferred Federal, state and local provision (credit) (2,304) (2,473) (2,671) -----------------------------------------------------------------------------------------------------Total taxes based on income $44,284 $38,233 $28,094 ======================================================================================================
Tax expense resulting from allocating certain tax benefits directly to common stock and retained earnings totaled $193,000, $455,000 and $102,000 for 1995, 1994 and 1993, respectively. The Company's effective tax rate varies from the statutory Federal income tax rate as a result of the following factors: 1995 1994 1993 ----------------------------------------------------------------------------------------------------Statutory rate 35.0% 35.0% 34.0% State and local income taxes 3.5 3.3 3.7 Change in Federal tax rate .3 Other .1 .4 .1 ----------------------------------------------------------------------------------------------------Effective rate 38.6% 39.0% 37.8% =====================================================================================================
Deferred income taxes recorded in the consolidated balance sheets at June 30, 1995 and 1994 consist of the following: 1995 1994 ----------------------------------------------------------------------------------------------------Deferred tax assets (liabilities): (Dollars in Thousands) Employee medical and other benefits $ 4,557 $ 4,482 Inventories 4,424 3,105 Other accrued liabilities 1,482 2,693 Receivable valuation allowances 1,424 930 ----------------------------------------------------------------------------------------------------Total deferred tax assets 11,887 11,210 ----------------------------------------------------------------------------------------------------Property (5,391) (6,789) Other (77) (306) ----------------------------------------------------------------------------------------------------Total deferred tax liabilities (5,468) (7,095) ----------------------------------------------------------------------------------------------------Net deferred tax asset $ 6,419 $ 4,115
=====================================================================================================
Cash payments for income taxes were $51,529,000, $39,354,000 and $33,106,000 for 1995, 1994 and 1993, respectively. 8. SHAREHOLDERS' EQUITY The company is authorized to issue 2,650,000 shares of preferred stock consisting of 350,000 shares of Class A Participating Preferred Stock with $1.00 par value, 1,150,000 shares of Class B Voting Preferred Stock without par value and 1,150,000 shares of Class C Nonvoting Preferred Stock without par value.
In April 1990, the Company's Board of Directors adopted a Rights Agreement which provides for one preferred share purchase right to be associated with each share of the Company's outstanding common stock. Shareholders exercising these rights would become entitled to purchase shares of Class A Participating Preferred Stock. The rights may be exercised on or after the time when a person or group of persons without the approval of the Board of Directors acquire beneficial ownership of 15 percent or more of the Company's common stock or announce the initiation of a tender or exchange offer which if successful would cause such person or group to beneficially own 30 percent or more of the common stock. Such exercise may ultimately entitle the holders of the rights to purchase for $70 per right common stock of the Company having a market value of $140. The person or groups effecting such 15 percent acquisition or undertaking such tender offer will not be entitled to exercise any rights. These rights expire April 2000 unless earlier redeemed by the Company under circumstances permitted by the Rights Agreement. In August 1995, as approved by the Board of Directors the Company purchased 250,000 shares of common stock from the estate of the Chief Executive Officer's father, a founder and former Chairman of the Company. The shares were acquired at a purchase price of $35.81 per share, which represented the average quoted closing price of the stock during the first twenty of the twenty-two business days preceding the date of purchase. The quoted closing price of the common stock as of the date of purchase was $36.25. 9. STOCK OPTIONS Under terms of an incentive stock option plan as amended and approved by the shareholders, the Company reserved 3,625,000 common shares for issuance to qualified key employees. All options granted were exercisable at prices not less than fair market value as of the date of grant. The Company's authority to grant options under this plan expired in May 1995. In conjunction with the 1995 Annual Meeting of Shareholders, the Company intends to solicit shareholder approval for adoption of a new employee stock option plan. The following summarizes stock option activity for each of the three years ended June 30, 1995: Number of Option Price Options Shares Per Share Total ---------------------------------------------------------------------------------------------------------Outstanding-June 30, 1992 168,895 $ 7.50-$ 8.77 $1,324,000 Granted 309,793 $25.59-$28.15 7,937,000 Exercised (59,817) $ 7.50-$25.59 (494,000) ---------------------------------------------------------------------------------------------------------Outstanding-June 30, 1993 418,871 $ 7.50-$28.15 8,767,000 Exercised (195,119) $ 7.50-$25.59 (4,505,000) Forfeited (729) $25.59 (19,000) ---------------------------------------------------------------------------------------------------------Outstanding-June 30, 1994 223,023 $ 7.50-$28.15 4,243,000 Granted 216,600 $33.38-$36.71 7,236,000 Exercised (130,026) $ 7.50-$33.38 (2,544,000) Forfeited (3,554) $25.59-$28.15 (99,000) ---------------------------------------------------------------------------------------------------------Outstanding-June 30, 1995 306,043 $ 7.50-$36.71 $8,836,000 ==========================================================================================================
The stock options outstanding at June 30, 1995 expire as follows: Number of January Shares ---------------------------------------------------------------------------------------------------------1996 41,944 1997 176,100 1999 10,000 2000 6,795 2002 47,999 2005 23,205 ---------------------------------------------------------------------------------------------------------Total 306,043 ==========================================================================================================
10. PENSION AND OTHER POSTRETIREMENT BENEFITS PENSION PLANS: The Company and certain of its operating subsidiaries sponsor five noncontributory defined benefit plans which cover the union workers at such locations. Additionally, the Company and certain of its operating subsidiaries participate in two multiemployer defined benefit plans covering the union workers at such locations. Benefits under these plans are primarily based on negotiated rates and years of service. The Company contributes to these pension funds at least the minimum amount required by regulation or contract.
Net pension cost relating to these plans for each of the years in the period ended June 1995 is summarized as follows: 1995 1994 1993 -----------------------------------------------------------------------------------------------------Company sponsored plans (Dollars in Thousands) Service cost - benefits earned during the period $ 507 $ 556 $ 449 Interest cost on projected benefit obligations 1,507 1,442 1,347 Actual return on pension plan assets (2,984) (460) (4,272) Net amortization and deferrals 1,130 (1,438) 2,688 -----------------------------------------------------------------------------------------------------Net pension cost for Company plans 160 100 212 Multiemployer plans 594 487 371 -----------------------------------------------------------------------------------------------------Net pension cost $ 754 $ 587 $ 583 ======================================================================================================
The following table summarizes the funded status of the Company's plans at June 30, 1995 and 1994: 1995 1994 -----------------------------------------------------------------------------------------------------(Dollars in Thousands) Actuarial present value of benefit obligation: Vested benefits $22,215 $20,109 ====================================================================================================== Accumulated benefit obligation $22,223 $20,240 ====================================================================================================== Projected benefit obligation $22,223 $20,240 Plan assets at fair value 23,792 22,014 -----------------------------------------------------------------------------------------------------Excess of assets over projected benefit obligation 1,569 1,774 Unrecognized net gain (1,879) (2,202) Unrecognized prior service costs 1,103 1,170 Remaining unrecognized net transition obligation 303 334 -----------------------------------------------------------------------------------------------------Net recorded pension asset $ 1,096 $ 1,076 ======================================================================================================
The majority of plan assets are invested in bonds, short-term investments and common stock including shares of the Company's common stock with a market value of $3,325,000, $3,296,000 and $4,198,000 as of June 30, 1995, 1994 and 1993, respectively. The weighted average discount rates used in determining the projected benefit obligation for 1995, 1994 and 1993 were 7.25%, 7.7% and 7.0%, respectively. The expected long-term rate of return on assets was 9.0% for the three years. EMPLOYEE STOCK OWNERSHIP PLAN: The Company sponsors an Employee Stock Ownership Plan (ESOP). In April 1990, the Company loaned $10,000,000 to the ESOP for the purpose of purchasing the Company's common stock in furtherance of the objectives of the Plan. The Company funded this transaction primarily through short-term bank borrowings. With the proceeds and as adjusted for all stock splits since April 1990, the ESOP effectively purchased 1,194,390 shares of the Company's common stock in the open market. The ESOP is fully paid by the Company and generally provides coverage to all domestic employees, except those covered by a collective bargaining agreement. Contributions to the ESOP are to be not less than that required by the terms of the loan agreement between the Company and the ESOP. The Company uses the shares-allocated method of accounting in determining the amount of expense related to each contribution. As of June 30, 1995, the amount due from the ESOP is recorded as a reduction in shareholders' equity and represents the Company's prepayment of future contributions to the ESOP. This amount will be expensed over not more than the next two years. Dividends accumulated on the Company's unallocated common stock held by the ESOP are used to repay the loan to the Company. Accordingly, the pretax expense associated with 1995, 1994 and 1993 totaled $1,027,000, $1,008,000 and $994,000, which is net of dividends of $252,000, $270,000 and $285,000 on the unallocated shares, respectively. In November 1993, the Accounting Standards Executive Committee issued Statement of Position 93-6, "Employers' Accounting for Employee Stock Ownership Plans." This Statement will not effect the Company's accounting treatment of existing shares purchased by the ESOP discussed above. However, any future purchases of the Company's stock by the ESOP will require the adoption of this Statement. POSTRETIREMENT BENEFITS: In addition to pension benefits, the Company also provides certain employees other postretirement benefits including health care and life insurance coverage. As of June 30, 1995, the Company provides such coverage under three active benefit plans of which two relate to collectively bargained benefits. In general, all eligible employees are entitled to receive medical and life insurance benefits upon meeting
certain age and service requirements at the time of their retirement.
The Company recognizes the cost of postretirement medical and life insurance benefits as the employees render service in accordance with Statement of Financial Accounting Standards (SFAS) No. 106. Relevant information with respect to these postretirement benefits as of June 30, 1995 and 1994 can be summarized as follows: 1995 1994 ------------------------------------------------------------------------------------------------------(Dollars in Thousands) Accumulated postretirement benefit obligation: Retired participants $1,845 $1,591 Fully eligible active plan participants 280 244 Other active plan participants 992 530 ------------------------------------------------------------------------------------------------------Total 3,117 2,365 Unrecognized net gain (loss) from past experience and changes in assumptions (266) 468 ------------------------------------------------------------------------------------------------------Accrued postretirement benefit cost $2,851 $2,833 ======================================================================================================= Net postretirement benefit cost: Service cost $ 74 $ 101 Interest cost 167 211 ------------------------------------------------------------------------------------------------------Total $ 241 $ 312 ======================================================================================================= Estimated effect of 1% increase in assumed medical cost trend rates: Increase in accumulated postretirement benefit obligation $ 248 $ 251 ======================================================================================================= Increase in net periodic postretirement benefit cost $ 37 $ 56 ======================================================================================================= Assumed weighted average discount rate 7.25% 7.7% =======================================================================================================
For 1995, annual increases in medical costs are initially assumed to total approximately 9% per year and gradually declining to 5% by approximately the year 2003. Annual increases in medical costs for 1994 were assumed to total approximately 10% per year and gradually declining to 5% by approximately the year 2005. The Company and certain of its subsidiaries participate in two multiemployer plans that provide various postretirement health and welfare benefits to the union workers at such locations. The Company's contributions required by its participation in the multiemployer plans totaled $1,174,000, $996,000 and $832,000 in 1995, 1994 and 1993, respectively. 11. COMMITMENTS The Company has operating leases with initial noncancelable lease terms in excess of one year, covering the rental of various facilities and equipment, which expire at various dates through fiscal 2002. Certain of these leases contain renewal options, some provide options to purchase during the lease term and some require contingent rentals based on usage. The future minimum rental commitments due under these leases are summarized as follows (in thousands): 1996-$5,077; 1997-$4,028; 1998-$2,708; 1999-$1,050; 2000-$406; thereafter-$254. Total rental expense, including short-term cancelable leases, during 1995, 1994 and 1993 is summarized as follows: 1995 1994 1993 ------------------------------------------------------------------------------------------------------(Dollars in Thousands) Operating leases: Minimum rentals $4,225 $4,006 $3,814 Contingent rentals 457 306 540 Short-term cancelable leases 2,288 1,550 1,198 ------------------------------------------------------------------------------------------------------Total $6,970 $5,862 $5,552 =======================================================================================================
12. CONTINGENCIES AND ENVIRONMENTAL MATTERS At June 30, 1995, the Company is a party to various legal and environmental matters which have arisen in the ordinary course of business. Such matters did not have a material adverse effect on the current year results of operations and, in the opinion of management, their ultimate disposition will not have a material adverse effect on the Company's future consolidated financial position or results of operations. Environmental expenditures relating to current or past operations are expensed in the period incurred. Expenditures relating to future operations are capitalized, provided they are recoverable and serve to improve the property. The Company records an estimate for contingent and environmental liabilities when costs are both probable and can be reasonably estimated. The Company periodically evaluates and revises such estimates based upon expenditures against such reserves and the availability of additional relevant information.
INDEPENDENT AUDITORS' REPORT To the Shareholders and Directors of Lancaster Colony Corporation We have audited the accompanying consolidated balance sheets of Lancaster Colony Corporation and its subsidiaries as of June 30, 1995 and 1994, and the related consolidated statements of income, shareholders' equity, and cash flows for each of the three years in the period ended June 30, 1995. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Lancaster Colony Corporation and its subsidiaries as of June 30, 1995 and 1994, and the results of their operations and their cash flows for each of the three years in the period ended June 30, 1995 in conformity with generally accepted accounting principles. /s/ Deloitte & Touche LLP Columbus, Ohio August 29, 1995
SELECTED QUARTERLY FINANCIAL DATA For the Years Ended June 30, 1995 and 1994 Net Gross Net Earnings Stock Prices(1) Dividends Paid (Thousands Except Per Share Figures) Sales Margin Income Per Share(1) High Low Per Share(1) -----------------------------------------------------------------------------------------------------------------------------------1995 First quarter $189,130 $ 57,016 $ 15,320 $ .51 $39.250 $32.750 $.12 Second quarter 225,248 69,944 19,981 .66 35.625 28.250 .14 Third quarter 191,975 59,205 16,413 .55 36.750 28.750 .14 Fourth quarter 188,773 61,777 18,810 .63 37.250 34.000 .15 ----------------------------------------------------------------------------------------------------------------------------------Year $795,126 $247,942 $ 70,524 $2.35 $39.250 $28.250 $.55 =================================================================================================================================== 1994 First quarter $172,821 $ 54,408 $ 13,020 $ .43 $31.500 $26.875 $.0975 Second quarter 192,757 62,202 15,517 .51 35.625 30.000 .1125 Third quarter 171,492 53,858 13,239 .44 34.500 31.125 .1125 Fourth quarter 184,662 61,628 18,084 .60 37.375 29.000 .1200 ----------------------------------------------------------------------------------------------------------------------------------Year $721,732 $232,096 $ 59,860 $1.97 $37.375 $26.875 $.4425 =================================================================================================================================== (1) Adjusted for the 4-for-3 stock split paid July 1994.
Lancaster Colony common shares are traded in the Nasdaq National Market System (Nasdaq Symbol: LANC). Stock quotations were obtained from the National Association of Securities Dealers. The number of shareholders as of September 1, 1995 was approximately 9,500.
Exhibit 21 LANCASTER COLONY CORPORATION SIGNIFICANT SUBSIDIARIES OF REGISTRANT
Name ---Colony Printing & Labeling, Inc. Dee Zee, Inc. Fostoria Glass Company Indiana Glass Company LRV Acquisition Corp. LaGrange Molded Products, Inc. Lancaster Colony Canada Inc. Lancaster Colony Commercial Products, Inc. Lancaster Glass Corporation New York Frozen Foods, Inc. Pretty Products, Inc. T. Marzetti Company The Quality Bakery Company, Inc. Reames Foods, Inc. Waycross Molded Products, Inc.
All subsidiaries conduct their business under the names shown.
State or Province of Incorporation -------------------Indiana Ohio West Virginia Indiana Ohio Delaware Ontario Ohio Ohio Ohio Ohio Ohio Ohio Iowa Ohio
Percent of Ownership ---------100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Exhibit 23 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in Registration Statement No. 33-39102 of Lancaster Colony Corporation on Form S-8 of our reports dated August 29, 1995, appearing in and incorporated by reference in this Annual Report on Form 10-K of Lancaster Colony Corporation for the year ended June 30, 1995. /S/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP Columbus, Ohio September 21, 1995
ARTICLE 5 THIS SCHEDULE CONTAINS SUMMARY FINANICIAL INFORMATION EXTRACTED FROM THE REGISTRANT'S CONSOLIDATED BALANCE SHEET AND STATEMENT OF INCOME FOR THE YEAR ENDED JUNE 30, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. MULTIPLIER: 1,000
PERIOD TYPE FISCAL YEAR END PERIOD END CASH SECURITIES RECEIVABLES ALLOWANCES INVENTORY CURRENT ASSETS PP&E DEPRECIATION TOTAL ASSETS CURRENT LIABILITIES BONDS COMMON PREFERRED MANDATORY PREFERRED OTHER SE TOTAL LIABILITY AND EQUITY SALES TOTAL REVENUES CGS TOTAL COSTS OTHER EXPENSES LOSS PROVISION INTEREST EXPENSE INCOME PRETAX INCOME TAX INCOME CONTINUING DISCONTINUED EXTRAORDINARY CHANGES NET INCOME EPS PRIMARY EPS DILUTED
YEAR JUN 30 1995 JUN 30 1995 8,239 0 90,363 1,947 141,886 249,767 282,525 169,338 379,904 60,512 31,840 28,086 0 0 249,062 379,904 795,126 795,126 547,184 547,184 0 0 2,736 114,808 44,284 70,524 0 0 0 70,524 2.35 0
End of Filing © 2005 | EDGAR Online, Inc.
