UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For The Quarterly Period Ended March 31, 2003
Commission File Number 001-11091
APOGENT TECHNOLOGIES INC.
(Exact name of registrant as specified in its charter)
| Wisconsin |
22-2849508 | |
| (State or other jurisdiction of Incorporation or organization) |
(I.R.S. Employer Identification No.) |
30 Penhallow Street, Portsmouth, New Hampshire 03801
(Address of principal executive offices, including zip code)
(603) 433-6131
(Registrant’s telephone number, including area code)
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 ¨
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).
YES ¨ NO x
At April 21, 2003, there were 102,194,940 shares of the Registrant’s Common Stock, par value $0.01 per share, outstanding.
APOGENT TECHNOLOGIES INC. AND SUBSIDIARIES
FORM 10-Q
QUARTER ENDED MARCH 31, 2003
APOGENT TECHNOLOGIES INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
(unaudited)
| March 31, 2003 |
September 30, 2002 |
|||||||
| ASSETS |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ |
17,406 |
|
$ |
16,327 |
| ||
| Accounts receivable (less allowance for doubtful accounts of $4,288 and $5,723, respectively) |
|
176,941 |
|
|
186,950 |
| ||
| Inventories |
|
207,308 |
|
|
203,997 |
| ||
| Deferred income taxes |
|
14,127 |
|
|
14,127 |
| ||
| Prepaid expenses and other current assets |
|
18,442 |
|
|
19,689 |
| ||
| Assets of discontinued operations—held for sale |
|
52,404 |
|
|
5,436 |
| ||
| Total current assets |
|
486,628 |
|
|
446,526 |
| ||
| Available for sale security |
|
58,579 |
|
|
60,183 |
| ||
| Property, plant and equipment, net |
|
266,289 |
|
|
270,893 |
| ||
| Intangible assets, net |
|
1,154,949 |
|
|
1,243,113 |
| ||
| Other assets |
|
18,285 |
|
|
15,370 |
| ||
| Total assets |
$ |
1,984,730 |
|
$ |
2,036,085 |
| ||
| LIABILITIES AND SHAREHOLDERS’ EQUITY |
||||||||
| Current liabilities: |
||||||||
| Short-term debt and overdrafts |
$ |
14,026 |
|
$ |
10,640 |
| ||
| Current portion of long-term debt |
|
2,207 |
|
|
25,352 |
| ||
| Accounts payable |
|
46,281 |
|
|
53,779 |
| ||
| Income taxes payable |
|
49,332 |
|
|
53,064 |
| ||
| Accrued payroll and employee benefits |
|
29,243 |
|
|
32,009 |
| ||
| Accrued interest expense |
|
16,183 |
|
|
16,630 |
| ||
| Restructuring reserve |
|
874 |
|
|
1,548 |
| ||
| Other current liabilities |
|
29,452 |
|
|
23,074 |
| ||
| Liabilities of discontinued operations |
|
5,338 |
|
|
305 |
| ||
| Total current liabilities |
|
192,936 |
|
|
216,401 |
| ||
| Long-term debt, less current portion |
|
697,520 |
|
|
635,020 |
| ||
| Securities lending agreement |
|
58,579 |
|
|
60,183 |
| ||
| Deferred income taxes |
|
123,400 |
|
|
132,100 |
| ||
| Other liabilities |
|
17,028 |
|
|
17,243 |
| ||
| Commitments and contingent liabilities |
|
— |
|
|
— |
| ||
| Shareholders’ equity: |
||||||||
| Preferred stock, $0.01 par value; authorized 20,000,000 shares |
|
— |
|
|
— |
| ||
| Common stock, $0.01 par value; authorized 250,000,000 shares; issued 107,019,535 and 106,976,877 shares, respectively; outstanding 102,194,940, and 105,967,853 shares, respectively |
|
1,067 |
|
|
1,070 |
| ||
| Equity rights, 50 rights at $1.09 per right |
|
— |
|
|
— |
| ||
| Additional paid-in capital |
|
270,627 |
|
|
271,682 |
| ||
| Retained earnings |
|
721,142 |
|
|
748,791 |
| ||
| Accumulated other comprehensive loss |
|
(13,574 |
) |
|
(26,419 |
) | ||
| Treasury common stock, 4,824,595 and 1,009,024 shares at cost |
|
(83,995 |
) |
|
(19,986 |
) | ||
| Total shareholders’ equity |
|
895,267 |
|
|
975,138 |
| ||
| Total liabilities and shareholders’ equity |
$ |
1,984,730 |
|
$ |
2,036,085 |
| ||
See accompanying notes to the unaudited consolidated financial statements.
1
APOGENT TECHNOLOGIES INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
| Three Months Ended March 31, |
Six Months Ended March 31, |
|||||||||||||||
| 2003 |
2002 |
2003 |
2002 |
|||||||||||||
| Net sales |
$ |
276,638 |
|
$ |
255,088 |
|
$ |
534,436 |
|
$ |
489,062 |
| ||||
| Cost of sales |
|
145,409 |
|
|
126,757 |
|
|
278,366 |
|
|
246,446 |
| ||||
| Cost of products sold |
||||||||||||||||
| Restructuring charges |
|
— |
|
|
3,673 |
|
|
— |
|
|
3,673 |
| ||||
| Total cost of sales |
|
145,409 |
|
|
130,430 |
|
|
278,366 |
|
|
250,119 |
| ||||
| Gross profit |
|
131,229 |
|
|
124,658 |
|
|
256,070 |
|
|
238,943 |
| ||||
| Selling, general and administrative expenses |
|
71,310 |
|
|
63,029 |
|
|
139,940 |
|
|
121,922 |
| ||||
| Restructuring charges |
|
332 |
|
|
1,614 |
|
|
332 |
|
|
1,614 |
| ||||
| Total selling, general and administrative expenses |
|
71,642 |
|
|
64,643 |
|
|
140,272 |
|
|
123,536 |
| ||||
| Operating income |
|
59,587 |
|
|
60,015 |
|
|
115,798 |
|
|
115,407 |
| ||||
| Other income (expense): |
||||||||||||||||
| Interest expense |
|
(10,381 |
) |
|
(10,344 |
) |
|
(20,792 |
) |
|
(20,578 |
) | ||||
| Amortization of deferred financing fees |
|
(891 |
) |
|
(914 |
) |
|
(1,803 |
) |
|
(1,741 |
) | ||||
| Other, net |
|
289 |
|
|
800 |
|
|
780 |
|
|
2,309 |
| ||||
| Income from continuing operations before income taxes |
|
48,604 |
|
|
49,557 |
|
|
93,983 |
|
|
95,397 |
| ||||
| Income taxes |
|
17,740 |
|
|
18,138 |
|
|
34,304 |
|
|
34,915 |
| ||||
| Income from continuing operations |
|
30,864 |
|
|
31,419 |
|
|
59,679 |
|
|
60,482 |
| ||||
| Discontinued operations, net of income tax benefit |
|
(87,246 |
) |
|
(12,470 |
) |
|
(87,328 |
) |
|
(11,562 |
) | ||||
| Net income (loss) |
$ |
(56,382 |
) |
|||||||||||||