UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
FORM 10-Q
(Mark one)
| [X] | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| [ ] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
ANCHOR GLASS CONTAINER CORPORATION
| 0-23359 |
| Commission file number |
| Delaware | 59-3417812 | |
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| (State or other jurisdiction of | (I.R.S. Employer | |
| incorporation or organization) | Identification No.) |
| One Anchor Plaza, 4343 Anchor Plaza Parkway, Tampa, FL | 33634-7513 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: 813-884-0000
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].
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Anchor Glass Container Corporation, common stock, $.10 par value,
ANCHOR GLASS CONTAINER CORPORATION
FORM 10-Q
For the Quarterly Period Ended September 30, 2003
INDEX
| Page No. | ||||||
PART I - FINANCIAL INFORMATION |
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Item 1. Financial Statements: |
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Condensed Statements of Operations and Comprehensive Income (Loss) -
Nine Months Ended September 30, 2003,
One Month Ended September 30, 2002 (Reorganized Company) and
Eight Months Ended August 31, 2002 (Predecessor Company) |
3 | |||||
Condensed Statements of Operations and Comprehensive Income (Loss) -
Three Months Ended September 30, 2003,
One Month Ended September 30, 2002 (Reorganized Company) and
Two Months Ended August 31, 2002 (Predecessor Company) |
4 | |||||
Condensed Balance Sheets -
September 30, 2003 and December 31, 2002-restated (Reorganized Company) |
5 | |||||
Condensed Statements of Cash Flows -
Nine Months Ended September 30, 2003,
One Month Ended September 30, 2002 (Reorganized Company) and
Eight Months Ended August 31, 2002 (Predecessor Company) |
6 | |||||
Condensed Statement of Stockholders’ Equity -
Nine Months Ended September 30, 2003 (Reorganized Company) |
7 | |||||
Notes to Condensed Financial Statements |
8 | |||||
Item 2. Management’s Discussion and Analysis of Financial
Condition and Results of Operations |
14 | |||||
Item 3. Quantitative and Qualitative Disclosures About
Market Risk |
21 | |||||
Item 4. Controls and Procedures |
21 | |||||
PART II - OTHER INFORMATION |
22 | |||||
Item 1. Legal Proceedings |
22 | |||||
Item 2. Changes in Securities and Use of Proceeds |
22 | |||||
Item 3. Defaults Upon Senior Securities |
22 | |||||
Item 4. Submission of Matters to a Vote of Security Holders |
22 | |||||
Item 5. Other Information |
22 | |||||
Item 6. Exhibits and Reports on Form 8-K |
22 | |||||
SIGNATURES |
23 | |||||
2
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
ANCHOR GLASS CONTAINER CORPORATION
CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(unaudited)
(dollars in thousands, except per share data)
| Predecessor | ||||||||||||||
| Reorganized Company | Company | |||||||||||||
| Nine Months | One Month | Eight Months | ||||||||||||
| Ended | Ended | Ended | ||||||||||||
| September 30, | September 30, | August 30, | ||||||||||||
| 2003 | 2002 | 2002 | ||||||||||||
Net sales |
$ | 542,771 | $ | 54,480 | $ | 504,195 | ||||||||
Costs and expenses: |
||||||||||||||
Cost of products sold |
499,301 | 50,447 | 451,619 | |||||||||||
Selling and administrative expenses |
20,093 | 1,942 | 19,262 | |||||||||||
Restructuring, net |
— | — | (395 | ) | ||||||||||
Income from operations |
23,377 | 2,091 | 33,709 | |||||||||||
Reorganization items, net |
— | — | 47,389 | |||||||||||
Other income (expense), net |
(1,416 | ) | 445 | 673 | ||||||||||
Interest expense (eight months ended
August 31, 2002 contractual interest of
$19,800) |
(36,805 | ) | (2,571 | ) | (17,948 | ) | ||||||||
Net income (loss) |
$ | (14,844 | ) | $ | (35 | ) | $ | 63,823 | ||||||
Series C preferred stock dividends |
$ | (7,262 | ) | $ | (750 | ) | ||||||||
Excess fair value of consideration
transferred over carrying value of
Series C preferred stock upon
redemption |
$ | (38,118 | ) | $ | — | $ | — | |||||||
Series A and B preferred stock dividends
(eight months ended August 31, 2002
contractual dividends of $9,371) |
$ | (4,100 | ) | |||||||||||
Income (loss) applicable to common stock |
$ | (60,224 | ) | $ | (785 | ) | $ | 59,723 | ||||||
Basic net income (loss) per share
applicable to common stock |
$ | (4.40 | ) | $ | (0.06 | ) | $ | 11.37 | ||||||
Basic weighted average number of common
shares outstanding |
13,673,557 | 13,499,995 | 5,251,356 | |||||||||||
Diluted net income (loss) per share
applicable to common stock |
$ | (4.40 | ) | $ | (0.06 | ) | $ | 1.89 | ||||||
Diluted weighted average number of
common shares outstanding |
13,673,557 | 13,499,995 | 33,805,651 | |||||||||||
Comprehensive income (loss): |
||||||||||||||
Net income (loss) |
$ | (14,844 | ) | $ | (35 | ) | $ | 63,823 | ||||||
Other comprehensive income (loss): |
||||||||||||||
Derivative income (loss) |
(434 | ) | 341 | 531 | ||||||||||
Comprehensive income (loss) |
$ | (15,278 | ) | $ | 306 | $ | 64,354 | |||||||
See Notes to Condensed Financial Statements.
3
ANCHOR GLASS CONTAINER CORPORATION
CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(unaudited)
(dollars in thousands, except per share data)
| Predecessor | ||||||||||||||
| Reorganized Company | Company | |||||||||||||
| Three Months | One Month | Two Months | ||||||||||||
| Ended | Ended | Ended | ||||||||||||
| September 30, | September 30, | August 30, | ||||||||||||
| 2003 | 2002 | 2002 | ||||||||||||
Net sales |
$ | 193,546 | $ | 54,480 | $ | 125,935 | ||||||||
Costs and expenses: |
||||||||||||||
Cost of products sold |
178,312 | 50,447 | 110,948 | |||||||||||
Selling and administrative expenses |
6,627 | 1,942 | 4,038 | |||||||||||
Restructuring, net |
— | — | (1,824 | ) | ||||||||||
Income from operations |
8,607 | 2,091 | 12,773 | |||||||||||
Reorganization items, net |
— | — | 50,089 | |||||||||||
Other income (expense), net |
(1,192 | ) | 445 | 190 | ||||||||||
Interest expense (two months ended
August 31, 2002 contractual interest of
$4,789) |
(11,667 | ) | (2,571 | ) | (3,974 | ) | ||||||||
Net income (loss) |
$ | (4,252 | ) | $ | (35 | ) | $ | 59,078 | ||||||
Series C preferred stock dividends |
$ | (2,511 | ) | $ | (750 | ) | ||||||||
Excess fair value of consideration
transferred over carrying value of
Series C preferred stock upon
redemption |
$ | (38,118 | ) | $ | — | $ | — | |||||||
Series A and B preferred stock dividends
(two months ended August 31, 2002
contractual dividends of $2,343) |
$ | — | ||||||||||||
Income (loss) applicable to common stock |
$ | (44,881 | ) | $ | (785 | ) | $ | 59,078 | ||||||
Basic net income (loss) per share
applicable to common stock |
$ | (3.20 | ) | $ | (0.06 | ) | $ | 11.25 | ||||||
Basic weighted average number of common
shares outstanding |
14,015,021 | 13,499,995 | 5,251,356 | |||||||||||
Diluted net income (loss) per share
applicable to common stock |
$ | (3.20 | ) | $ | (0.06 | ) | $ | 1.75 | ||||||
Diluted weighted average number of
common shares outstanding |
14,015,021 | 13,499,995 | 33,805,651 | |||||||||||
Comprehensive income (loss): |
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Net income (loss) |
$ | (4,252 | ) | $ | (35 | ) | $ | 59,078 | ||||||
Other comprehensive income (loss): |
||||||||||||||
Derivative income (loss) |
(1,141 | ) | 341 | — | ||||||||||
Comprehensive income (loss) |
$ | (5,393 | ) | $ | 306 | $ | 59,078 | |||||||
See Notes to Condensed Financial Statements.
4
ANCHOR GLASS CONTAINER CORPORATION
CONDENSED BALANCE SHEETS
(dollars in thousands)
| Reorganized Company | |||||||||||
| September 30, 2003 | December 31, 2002 | ||||||||||
| (unaudited) | (restated) | ||||||||||
ASSETS |
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Current assets: |
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Cash and cash equivalents |
$ | 14,852 | $ | 351 | |||||||
Restricted cash |
— | 4,387 | |||||||||
Accounts receivable |
48,336 | 42,070 | |||||||||
Inventories: |
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Raw materials and manufacturing supplies |
28,011 | 22,796 | |||||||||
Finished products |
102,119 | 79,353 | |||||||||
Other current assets |
8,915 | 8,603 | |||||||||
Total current assets |
202,233 | 157,560 | |||||||||
Property, plant and equipment, net |
455,082 | 384,386 | |||||||||
Other assets |
14,760 | 6,815 | |||||||||
Intangible assets |
7,042 | 7,636 | |||||||||
| $ | 679,117 | $ | 556,397 | ||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current liabilities: |
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Borrowings under revolving credit facility |
$ | — | $ | 47,413 | |||||||
Current maturities of long-term debt |
9,122 | 8,315 | |||||||||
Accounts payable |
39,835 | 46,969 | |||||||||
Accrued expenses |
20,818 | 35,314 | |||||||||
Accrued interest |
5,439 | 5,167 | |||||||||
Accrued compensation and employee benefits |
27,375 | 26,331 | |||||||||
Total current liabilities |
102,589 | 169,509 | |||||||||
Notes and long-term capital leases |
368,158 | 182,433 | |||||||||
Long-term obligation to PBGC |
57,084 | 60,640 | |||||||||
Total long-term debt |
425,242 | 243,073 | |||||||||
Long-term post-retirement liabilities |
40,064 | 40,342 | |||||||||
Other long-term liabilities |
22,763 | 23,952 | |||||||||
| 488,069 | 307,367 | ||||||||||
Commitments and contingencies
|
|||||||||||
Redeemable preferred stock (including accrued dividends) |
— | 78,022 | |||||||||
Stockholders’ equity: |
|||||||||||
Common stock |
2,338 | 1,350 | |||||||||
Capital in excess of par value |
113,662 | 3,650 | |||||||||
Accumulated deficit |
(27,297 | ) | (3,691 | ) | |||||||
Accumulated other comprehensive income (loss) |
(244 | ) | 190 | ||||||||
| 88,459 | 1,499 | ||||||||||
| $ | 679,117 | $ | 556,397 | ||||||||
See Notes to Condensed Financial Statements.
5
ANCHOR GLASS CONTAINER CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
(unaudited)
(dollars in thousands)
| Predecessor | |||||||||||||||
| Reorganized Company | Company | ||||||||||||||
| Nine Months | One Month | Eight Months | |||||||||||||
| Ended | Ended | Ended | |||||||||||||
| September 30, | September 30, | August 30, | |||||||||||||
| 2003 | 2002 | 2002 | |||||||||||||
Cash flows from operating activities: |
|||||||||||||||
Net income (loss) |
$ | (14,844 | ) | $ | (35 | ) | $ | 63,823 | |||||||
Adjustments to reconcile net income (loss) to cash
provided by (used in) operating activities: |
|||||||||||||||
Depreciation and amortization |
51,716 | 4,653 | 35,721 | ||||||||||||
Write-off and amortization of financing fees |
4,846 | 153 | 1,609 | ||||||||||||
Restructuring, net |
— | — | (395 | ) | |||||||||||
Reorganization items, net |
— | — | (47,389 | ) | |||||||||||
Restructuring and reorganization payments |
— | (1,455 | ) | (4,835 | ) | ||||||||||
Other |
239 | 458 | (239 | ) | |||||||||||
Increase (decrease) in cash resulting from changes in
assets and liabilities |
(52,704 | ) | 6,203 | 4,819 | |||||||||||
| (10,747 | ) | 9,977 | 53,114 | ||||||||||||
Cash flows from investing activities: |
|||||||||||||||
Expenditures for property, plant and equipment |
(80,437 | ) | (5,448 | ) | (42,654 | ) | |||||||||
Purchase of equipment under leases |
(39,217 | ) | — | — | |||||||||||
Proceeds from sale of property, plant and equipment |
10,590 | — | 47 | ||||||||||||
Change in restricted cash |
4,387 | 343 | (5,935 | ) | |||||||||||
Other |
(2,391 | ) | (119 | ) | |||||||||||