UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

 

FORM 10-Q

 

(Mark One)

 

 

UNITED STATIONERS INC.

(Exact Name of Registrant as Specified in its Charter)

 

Delaware		36-3141189
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

 

2200 East Golf Road

Des Plaines, Illinois  60016-1267

(847)  699-5000

(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)

 

Indicate by check mark whether 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 registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

 

Yes  ý    No  o

 

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

 

Yes  ý    No  o

 

On November 4, 2004, the registrant had outstanding 33,058,466 shares of common stock, par value $0.10 per share.

 

 

UNITED STATIONERS INC.

FORM 10-Q

For the Quarterly Period Ended September 30, 2004

 

TABLE OF CONTENTS

 

PART I – FINANCIAL INFORMATION
Item 1. Financial Statements.
	Report of Independent Registered Public Accounting Firm	2
	Condensed Consolidated Balance Sheets as of September 30, 2004 and December 31, 2003	3
	Condensed Consolidated Statements of Income for the Three Months and Nine Months ended September 30, 2004 and 2003	4
	Condensed Consolidated Statements of Cash Flows for the Nine Months ended September 30, 2004 and 2003	5
	Notes to Condensed Consolidated Financial Statements	6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.		15
Item 3. Quantitative and Qualitative Disclosures About Market Risk.		27
Item 4. Controls and Procedures.		28
PART II – OTHER INFORMATION
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.		29
Item 6. Exhibits.		29
SIGNATURES		31

 

1

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

 

The Board of Directors

United Stationers Inc.

 

We have reviewed the condensed consolidated balance sheet of United Stationers Inc. and Subsidiaries as of September 30, 2004, and the related condensed consolidated statements of income for the three month and nine month periods ended September 30, 2004 and 2003, and the condensed consolidated statements of cash flows for the nine month periods ended September 30, 2004 and 2003.  These financial statements are the responsibility of the Company’s management.

 

We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States).  A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters.  It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board, the objective of which is to express an opinion regarding the financial statements taken as a whole.  Accordingly, we do not express such an opinion.

 

Based on our review, we are not aware of any material modifications that should be made to the condensed consolidated financial statements referred to above for them to be in conformity with U.S. generally accepted accounting principles.

 

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of United Stationers Inc. as of December 31, 2003, and the related consolidated statements of income, changes in stockholders’ equity, and cash flows for the year then ended (not presented herein) and in our report dated January 26, 2004, we expressed an unqualified opinion on those consolidated financial statements and included an explanatory paragraph related to a change in accounting principle for supplier allowances.  In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 2003, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

 

 

/s/ Ernst & Young LLP

 

 

Chicago, Illinois

October 25, 2004

 

2

 

UNITED STATIONERS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

 (dollars in thousands, except share data)

 

		(Unaudited)			(Audited)
		As of September 30, 2004			As of December 31, 2003
ASSETS
Current assets:
Cash and cash equivalents		$	14,220		$	10,307
Retained interest in receivables sold, less allowance for doubtful accounts of $3,539 in 2004 and $3,758 in 2003		264,801			153,722
Accounts receivable, less allowance for doubtful accounts of $11,605 in 2004 and $11,811 in 2003		177,941			195,433
Inventories		555,408			539,919
Other current assets		21,866			25,943
Total current assets		1,034,236			925,324
Property, plant and equipment, at cost		335,872			334,333
Less - accumulated depreciation and amortization		187,136			176,617
Net property, plant and equipment		148,736			157,716
Goodwill, net		182,836			182,474
Other		20,713			29,496
Total assets		$	1,386,521		$	1,295,010
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	396,274		$	357,961
Accrued liabilities		136,415			135,604
Deferred credits		63,250			44,867
Current maturities of long-term debt		—			24
Total current liabilities		595,939			538,456
Deferred income taxes		21,543			21,624
Long-term debt		14,300			17,300
Other long-term liabilities		44,571			44,652
Total liabilities		676,353			622,032
Stockholders’ equity:
Common stock, $0.10 par value; authorized - 100,000,000 shares, issued - 37,217,814 in 2004 and 2003		3,722			3,722
Additional paid-in capital		333,578			329,787
Treasury stock, at cost - 4,171,575 shares in 2004 and 3,314,347 shares in 2003		(120,742		)	(82,863		)
Retained earnings		501,360			430,637
Accumulated other comprehensive loss		(7,750		)	(8,305		)
Total stockholders’ equity		710,168			672,978
Total liabilities and stockholders’ equity		$	1,386,521		$	1,295,010

 

See notes to condensed consolidated financial statements.

 

3

 

UNITED STATIONERS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(dollars in thousands, except per share data)

(Unaudited)

 

		For the Three Months Ended September 30,						For the Nine Months Ended September 30,
		2004			2003			2004			2003
Net sales		$	1,028,833		$	979,430		$	2,983,377		$	2,905,116
Cost of goods sold		876,039			833,680			2,540,255			2,486,286
Gross profit		152,794			145,750			443,122			418,830
Operating expenses:
Warehousing, marketing and administrative expenses