SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10–Q
(Mark one)
| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| For the quarterly period ended March 31, 2003 |
OR
| ¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| For the transition period from to |
Commission file number 0-8135
SIGMA-ALDRICH CORPORATION
(Exact name of registrant as specified in its charter)
| Delaware (State or other jurisdiction of incorporation or organization) |
43-1050617 (I.R.S. Employer Identification No.) | |
| 3050 Spruce Street, St. Louis, Missouri (Address of principal executive office) |
63103 (Zip Code) |
(314) 771-5765
(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 Act). Yes x No ¨
There were 70,873,468 shares of the Company’s common stock, $1.00 par value per share, outstanding on April 30, 2003.
Part 1- FINANCIAL INFORMATION
Item 1. Financial Statements
Sigma-Aldrich Corporation
Consolidated Statements of Income (unaudited)
(in thousands except per share amounts)
| Three Months Ended March 31, |
|||||||
| 2003 |
2002 |
||||||
| Net sales |
$ |
334,717 |
$ |
301,605 |
| ||
| Cost of products sold |
|
163,710 |
|
146,853 |
| ||
| Gross profit |
|
171,007 |
|
154,752 |
| ||
| Selling, general and administrative expenses |
|
87,294 |
|
78,612 |
| ||
| Research and development expenses |
|
10,828 |
|
10,258 |
| ||
| Interest, net |
|
2,817 |
|
4,063 |
| ||
| Income from continuing operations before income taxes |
|
70,068 |
|
61,819 |
| ||
| Provision for income taxes |
|
21,161 |
|
19,164 |
| ||
| Net income from continuing operations |
|
48,907 |
|
42,655 |
| ||
| Discontinued operations: |
|||||||
| Net income (loss) from operations of discontinued business |
|
1,053 |
|
(2,920 |
) | ||
| Adjustment to net loss on disposition of discontinued operations |
|
1,555 |
|
— |
| ||
| Net income |
$ |
51,515 |
$ |
39,735 |
| ||
| Net income per share – Basic |
|||||||
| Net income from continuing operations |
$ |
0.69 |
$ |
0.58 |
| ||
| Net income (loss) from operations of discontinued business |
|
0.02 |
|
(0.04 |
) | ||
| Adjustment to net loss on disposition of discontinued operations |
|
0.02 |
|
— |
| ||
| Net income |
$ |
0.73 |
$ |
0.54 |
| ||
| Net income per share – Diluted |
|||||||
| Net income from continuing operations |
$ |
0.68 |
$ |
0.58 |
| ||
| Net income (loss) from operations of discontinued business |
|
0.02 |
|
(0.04 |
) | ||
| Adjustment to net loss on disposition of discontinued operations |
|
0.02 |
|
— |
| ||
| Net income |
$ |
0.72 |
$ |
0.54 |
| ||
| Weighted average number of shares outstanding – Basic |
|
71,150 |
|
73,017 |
| ||
| Weighted average number of shares outstanding – Diluted |
|
71,634 |
|
73,604 |
| ||
| Dividends per share |
$ |
0.090 |
$ |
0.085 |
| ||
See accompanying notes to consolidated financial statements.
2
Sigma-Aldrich Corporation
Consolidated Balance Sheets
(in thousands except per share amounts)
| March 31, 2003 (unaudited) |
December 31, 2002 |
|||||||
| Assets |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ |
54,195 |
|
$ |
52,382 |
| ||
| Accounts receivable, net of allowance for doubtful accounts |
|
206,181 |
|
|
175,356 |
| ||
| Inventories |
|
417,209 |
|
|
421,368 |
| ||
| Other current assets |
|
48,102 |
|
|
45,396 |
| ||
| Current assets of discontinued operations |
|
150 |
|
|
385 |
| ||
| Total current assets |
|
725,837 |
|
|
694,887 |
| ||
| Property, plant and equipment: |
||||||||
| Land |
|
37,920 |
|
|
37,600 |
| ||
| Buildings and improvements |
|
442,977 |
|
|
435,018 |
| ||
| Machinery and equipment |
|
500,957 |
|
|
496,594 |
| ||
| Construction in progress |
|
24,858 |
|
|
26,994 |
| ||
| Less – accumulated depreciation |
|
(476,399 |
) |
|
(460,409 |
) | ||
| Net property, plant and equipment |
|
530,313 |
|
|
535,797 |
| ||
| Goodwill, net |
|
106,611 |
|
|
105,548 |
| ||
| Other assets |
|
53,231 |
|
|
53,424 |
| ||
| Total assets |
$ |
1,415,992 |
|
$ |
1,389,656 |
| ||
| Liabilities and Stockholders’ Equity |
||||||||
| Current liabilities: |
||||||||
| Notes payable and current maturities of long-term debt |
$ |
58,138 |
|
$ |
89,930 |
| ||
| Accounts payable |
|
73,005 |
|
|
69,184 |
| ||
| Accrued payroll and payroll taxes |
|
35,312 |
|
|
32,769 |
| ||
| Accrued income taxes |
|
34,336 |
|
|
25,949 |
| ||
| Other accrued expenses |
|
42,159 |
|
|
43,961 |
| ||
| Current liabilities of discontinued operations |
|
1,693 |
|
|
3,860 |
| ||
| Total current liabilities |
|
244,643 |
|
|
265,653 |
| ||
| Long-term debt |
|
176,687 |
|
|
176,805 |
| ||
| Deferred post-retirement benefits |
|
49,624 |
|
|
48,675 |
| ||
| Other liabilities |
|
18,023 |
|
|
16,349 |
| ||
| Total liabilities |
|
488,977 |
|
|
507,482 |
| ||
| Stockholders’ equity: |
||||||||
| Common stock, $1.00 par value; 200,000 shares authorized; 100,983 and 101,001 shares issued at March 31, 2003 and December 31, 2002, respectively; 71,076 and 71,253 shares outstanding at March 31, 2003 and December 31, 2002, respectively |
|
100,983 |
|
|
101,001 |
| ||
| Capital in excess of par value |
|
45,193 |
|
|
45,751 |
| ||
| Common stock in treasury, at cost, 29,907 and 29,748 shares at March 31, 2003 and December 31, 2002, respectively |
|
(1,012,316 |
) |
|
(1,002,950 |
) | ||
| Retained earnings |
|
1,798,939 |
|
|
1,753,737 |
| ||
| Accumulated other comprehensive loss |
|
(5,784 |
) |
|
(15,365 |
) | ||
| Total stockholders’ equity |
|
927,015 |
|
|
882,174 |
| ||
| Total liabilities and stockholders’ equity |
$ |
1,415,992 |
|
$ |
1,389,656 |
| ||
See accompanying notes to consolidated financial statements.
3
Sigma-Aldrich Corporation
Consolidated Statements of Cash Flows (unaudited)
(in thousands)
| Three Months |
||||||||
| Ended March 31, |
||||||||
| 2003 |
2002 |
|||||||
| Cash flows from operating activities: |
||||||||
| Net income |
$ |
51,515 |
|
$ |
39,735 |
| ||
| Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||
| Net (income) loss from operations of discontinued business |
|
(1,053 |
) |
|
2,920 |
| ||
| Adjustment to net loss on disposition of discontinued operations |
|
(1,555 |
) |
|
— |
| ||
| Depreciation and amortization |
|
17,122 |
|
|
16,406 |
| ||
| Deferred income taxes |
|
2,783 |
|
|
(441 |
) | ||
| Post-retirement benefits expense |
|
776 |
|
|
(788 |
) | ||
| Deferred compensation, net |
|
(23 |
) |
|
78 |
| ||
| Change in assets and liabilities: |
||||||||
| (Increase) in accounts receivable |
|
(28,507 |
) |
|
(29,701 |
) | ||
| Decrease in inventories |
|
8,056 |
|
|
8,521 |
| ||
| Increase in accrued income taxes |
|
19,369 |
|
|
15,971 |
| ||
| Other |
|
(9,394 |
) |
|
2,278 |
| ||
| Net cash provided by operating activities of continuing operations |
|
59,089 |
|
|
54,979 |
| ||
| Net cash provided by (used in) operating activities of discontinued operations |
|
23 |
|
|
(2,154 |
) | ||
| Net cash provided by operating activities |
|
59,112 |
|
|
||||