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 1-14982
HUTTIG BUILDING PRODUCTS, INC.
(Exact name of registrant as specified in its charter)
| Delaware |
43-0334550 | |
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) | |
| 555 Maryville University Drive Suite 240 St. Louis, Missouri |
63141 | |
| (Address of principal executive offices) |
(Zip code) |
(314) 216-2600
(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 Exchange Act Rule
12b-2). Yes ¨ No x
The number of shares of Common Stock outstanding on March 31, 2003 was 19,450,701 shares.
PART I. FINANCIAL INFORMATION
| Page No. | ||||
| Item 1. |
Financial Statements |
|||
| Consolidated Balance Sheets as of March 31, 2003 (unaudited) and December 31, 2002 |
3-4 | |||
| Consolidated Statements of Operations for the three months ended March 31, 2003 and 2002 (unaudited) |
5 | |||
| 6 | ||||
| Consolidated Statements of Cash Flows for the three months ended March 31, 2003 and 2002 (unaudited) |
7 | |||
| 8 | ||||
| Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
15 | ||
| Item 3. |
22 | |||
| Item 4. |
23 | |||
| PART II. OTHER INFORMATION |
||||
| Item 6. |
24 | |||
| 25 | ||||
| 26 | ||||
| 28 | ||||
- 2 -
HUTTIG BUILDING PRODUCTS, INC. AND SUBSIDIARIES
AS OF MARCH 31, 2003 AND DECEMBER 31, 2002
(In Millions)
| March 31, 2003 |
December 31, 2002 | |||||
| (unaudited) |
||||||
| ASSETS |
||||||
| Current Assets: |
||||||
| Cash and equivalents |
$ |
4.6 |
$ |
3.4 | ||
| Trade accounts receivable, net |
|
83.6 |
|
66.8 | ||
| Inventories, net |
|
90.9 |
|
84.4 | ||
| Other current assets |
|
8.6 |
|
8.1 | ||
| Total current assets |
|
187.7 |
|
162.7 | ||
| Property, Plant and Equipment: |
||||||
| Land |
|
6.6 |
|
6.6 | ||
| Building and improvments |
|
35.0 |
|
34.7 | ||
| Machinery and equipment |
|
36.8 |
|
37.6 | ||
| Gross property, plant and equipment |
|
78.4 |
|
78.9 | ||
| Less accumulated depreciation |
|
38.2 |
|
37.3 | ||
| Property, plant and equipment, net |
|
40.2 |
|
41.6 | ||
| Other Assets: |
||||||
| Goodwill |
|
13.6 |
|
13.6 | ||
| Other |
|
3.6 |
|
4.0 | ||
| Deferred income taxes |
|
10.6 |
|
11.6 | ||
| Total other assets |
|
27.8 |
|
29.2 | ||
| Total Assets |
$ |
255.7 |
$ |
233.5 | ||
see notes to consolidated financial statements
- 3 -
HUTTIG BUILDING PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31, 2003 AND DECEMBER 31, 2002
(In Millions, Except Share and Per Share Data)
| March 31, 2003 |
December 31, 2002 |
|||||||
| (unaudited) |
||||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY |
||||||||
| Current Liabilities: |
||||||||
| Current portion of debt |
$ |
0.9 |
|
$ |
0.9 |
| ||
| Trade accounts payable |
|
78.9 |
|
|
76.7 |
| ||
| Deferred income taxes |
|
3.5 |
|
|
4.0 |
| ||
| Accrued compensation |
|
5.3 |
|
|
5.8 |
| ||
| Other accrued liabilities |
|
8.7 |
|
|
7.2 |
| ||
| Total current liabilities |
|
97.3 |
|
|
94.6 |
| ||
| Non-current Liabilities: |
||||||||
| Debt |
|
92.5 |
|
|
67.0 |
| ||
| Fair value of derivative instruments |
|
0.5 |
|
|
1.6 |
| ||
| Other non-current liabilities |
|
2.0 |
|
|
2.1 |
| ||
| Total non-current liabilities |
|
95.0 |
|
|
70.7 |
| ||
| Commitments and Contingencies |
||||||||
| Shareholders’ Equity: |
||||||||
| Preferred shares; $.01 par (5,000,000 shares authorized) |
|
— |
|
|
— |
| ||
| Common shares; $.01 par (50,000,00 shares authorized; at March 31, 2003 and December 31, 2002—20,896,145 shares issued) |
|
0.2 |
|
|
0.2 |
| ||
| Additional paid-in capital |
|
33.4 |
|
|
33.5 |
| ||
| Retained earnings |
|
38.0 |
|
|
43.0 |
| ||
| Unearned compensation—restricted stock |
|
(0.1 |
) |
|
(0.4 |
) | ||
| Accumulated other comprehensive loss |
|
(0.2 |
) |
|
(0.6 |
) | ||
| Less: Treasury shares, at cost (1,445,444 shares at March 31, 2003; 1,405,013 shares at December 31, 2002) |
|
(7.9 |
) |
|
(7.5 |
) | ||
| Total shareholders’ equity |
|
63.4 |
|
|
68.2 |
| ||
| Total Liabilities and Shareholders’ Equity |
$ |
255.7 |
|
$ |
233.5 |
| ||
see notes to consolidated financial statements
- 4 -
HUTTIG BUILDING PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2003 AND 2002
(UNAUDITED)
(In Millions, Except Per Share Amounts)
| Three Months Ended March 31, |
||||||||
| 2003 |
2002 |
|||||||
| Net Sales |
$ |
196.0 |
|
$ |
215.6 |
| ||
| Cost of Sales and Operating Expenses: |
||||||||
| Cost of sales |
|
160.9 |
|
|
173.4 |
| ||
| Operating expenses |
|
39.8 |
|
|
40.1 |
| ||
| Depreciation and amortization |
|
1.6 |
|
|
1.5 |
| ||
| Gain on disposal of capital assets |
|
— |
|
|
(0.2 |
) | ||
| Total cost of sales and operating expenses |
|
202.3 |
|
|
214.8 |
| ||
| Operating Profit (Loss) |
|
(6.3 |
) |
|
0.8 |
| ||
| Other Income (Expense): |
||||||||
| Interest expense, net |
|
(2.2 |
) |
|
(2.2 |
) | ||
| Unrealized gain on derivatives |
|
0.5 |
|
|
0.4 |
| ||
| Total other expense, net |
|
(1.7 |
) |
|
(1.8 |
) | ||
| Loss Before Income Taxes and Cumulative Effect of a Change in Accounting Principle |
|
(8.0 |
) |
|
(1.0 |
) | ||
| Provision for Income Taxes |
|
(3.0 |
) |
|
(0.4 |
) | ||
| Net Loss Before Cumulative Effect of a Change in Accounting Principle |
|
(5.0 |
) |
|
(0.6 |
) | ||
| Cumulative Effect of a Change in Accounting Principle (Net of $7.9 Million of Taxes) |
|
— |
|
|
(12.8 |
) | ||
| Net Loss |
$ |
(5.0 |
) |
$ |
(13.4 |
) | ||
| Basic loss per share: |
||||||||
| Net loss before cumulative effect of a change in accounting principle |
$ |
(0.25 |
) |
$ |
(0.03 |
) | ||
| Cumulative effect of a change in accounting principle (net of taxes) |
|
— |
|
|
(0.64 |
) | ||
| Net loss per basic share |
$ |
(0.25 |
) |
$ |
(0.67 |
) | ||
| Weighted Average Basic Shares Outstanding |
|
19.6 |
|
|
19.7 |
| ||
| Diluted loss per share: |
||||||||
| Net loss before cumulative effect of a change in accounting principle |
$ |
(0.25 |
) |
$ |
(0.03 |
) | ||
| Cumulative effect of a change in accounting principle (net of taxes) |
|
— |
|
|
(0.64 |
) | ||
| Net loss per diluted share |
$ |
(0.25 |
) |
$ |
(0.67 |
) | ||
| Weighted Average Diluted Shares Outstanding |
|
19.6 |
|
|
19.7 |
| ||
see notes to consolidated financial statements
- 5 -
HUTTIG BUILDING PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 2003 AND 2002
(UNAUDITED)
(In Millions)
| Common Shares |
Additional Capital |
Retained Earnings |
Unearned Restricted Stock |
Accumulated Other |
Treasury |
Total |
|||||||||||||||||||||
| Balance at January 1, 2002 |
$ |
0.2 |
$ |
33.4 |
|
$ |
54.8 |
|
$ |
(0.4 |
) |
$ |
(1.7 |
) |
$ |
(7.2 |
) |
||||||||||