American Brands reports 1996 results; E.P.S. from operations up 10% to $1.01 in fourth quarter and up 11% to $3.20 for the year.OLD GREENWICH Old Greenwich is a neighborhood or section in the southeast corner of Greenwich in Fairfield County, Connecticut, United States. The Old Greenwich Railroad Station serves commuters in the neighborhood. , Conn.--(BUSINESS WIRE)--Jan. 24, 1997-- Expect to Achieve Growth Goals in 1997; Spin-Off The situation that arises when a parent corporation organizes a subsidiary corporation, to which it transfers a portion of its assets in exchange for all of the subsidiary's capital stock, which is subsequently transferred to the parent corporation's shareholders. Plans for Gallaher Tobacco Progressing American Brands, Inc. (NYSE-AMB) today announced that earnings per common share from operations rose 10% to $1.01 for the quarter ended December 31, 1996. This compared with 92 cents in the fourth quarter of 1995. Fully diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of from operations rose 9% to 98 cents. These fourth quarter figures exclude restructuring charges restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. of 34 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. (33 cents fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. ) in 1996 related to a plant consolidation in international tobacco, 6 cents per share in 1995 in connection with the worldwide reorganization of distilled spirits operations, and a 1 cent per share net loss in the 1995 quarter from operations of businesses disposed. The 1996 restructuring charge amounted to $88.8 million ($59.5 million after taxes), and the 1995 charge amounted to $17.8 million ($12.2 million after taxes). The comparisons reflect the benefit of share repurchases Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. . For the year, earnings per share from operations reached $3.20, up 11% from $2.88 in 1995. Fully diluted earnings per share from operations rose to $3.13, up 11%. These full-year comparisons exclude the factors affecting the quarter as well as a 10 cent (9 cent fully diluted) gain on disposal of businesses in the third quarter of 1995 and extraordinary charges relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the retirement of debt of 1 cent and 6 cents per share in 1995 and 1996, respectively. Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight rose 11% in the quarter to a record $3.4 billion, and operating company operating company A business that engages in transactions with outsiders. contribution (excluding restructuring charges) was $379 million, up 7%. For the year, sales reached a record $11.6 billion, up 7% (excluding businesses sold in 1995), and operating company contribution of $1.3 billion was up 7% (excluding businesses sold and restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). ). Comparisons benefited from the January 1996 acquisition of Cobra. During 1995, U.K. retailing and housewares house·wares pl.n. Cooking utensils, dishes, and other small articles used in a household, especially in the kitchen. operations, which generated substantial sales but minimal contribution, were sold. Average primary shares outstanding were reduced 6% in the quarter and 7% for the year, resulting in a net benefit to primary E.P.S. of 2 cents and 16 cents, respectively. Reflecting the redemption of convertible debenture Convertible Debenture Any type of debenture that can be converted into some other security. Notes: For example, a convertible bond can be converted into stock. issues, fully diluted shares declined 7% in the quarter and 9% for the year, favorably fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. affecting fully diluted E.P.S. by 2 cents and 20 cents, respectively. Including businesses disposed, restructuring, extraordinary charges and the 1995 gain on disposal of businesses, net income declined 26% and 10% in the quarter and year, respectively. Chairman and Chief Executive Officer Thomas C. Hays said: "American Brands had another fine year in 1996, again exceeding our 10% long-term E.P.S. goal. We also took decisive actions to enhance operations and shareholder value, most notably announcing in October plans to spin-off our U.K.-based Gallaher tobacco business to shareholders. "Steps to implement the spin-off, which will create two strong companies with enhanced prospects, are progressing. When the transaction is consummated con·sum·mate tr.v. con·sum·mat·ed, con·sum·mat·ing, con·sum·mates 1. a. To bring to completion or fruition; conclude: consummate a business transaction. b. , we plan to change the name American Brands to Fortune Brands." Completion of the transaction, which is currently expected around mid-year, is pending receipt of favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. tax rulings and relevant stockholder approvals. "We also repurchased 10 million shares of our common stock during 1996," Hays noted. "Following the spin-off of Gallaher, Fortune Brands will consider repurchasing up to 10 million shares, depending on market conditions and other investment opportunities. Over the past two years, we have invested $1.8 billion to reduce fully diluted shares by 20% and well over $400 million in capital projects to enhance competitiveness and to grow our powerful consumer brands." Favorable Outlook "Looking ahead," Hays noted, "our prospects are exciting and the outlook for our operations is bright. We expect another excellent year in 1997, despite continued intense competitive and pricing pressures. "When we sold The American Tobacco Company The American Tobacco Company was founded in 1890 by J. B. Duke as a merger between a number of tobacco manufacturers including Allen and Ginter and Goodwin & Company. The company was one of the original 12 members of the Dow Jones Industrial Average in 1896. at the end of 1994, we established a long-term goal to achieve E.P.S. growth in the range of 10%. We exceeded 10% in 1995 and 1996, and we expect, if there were no spin-off, that American Brands would again achieve that goal, excluding restructuring charges, in 1997. "In the first quarter, at current foreign exchange rates, we expect solid double-digit E.P.S. growth, in spite of challenging first quarter comparisons for golf and hardware. "Our brand development is in high gear, backed by substantial investments in marketing to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. attractive opportunities. This past year, we increased investment in advertising and R&D at double-digit rates. We also remain firmly committed to reducing our cost structure. "Following completion over the next three to four years of the factory consolidation they announced last month, Gallaher anticipates substantial annual savings. That consolidation will result in the closure of Gallaher's Hyde factory in Manchester, England. As we have indicated, we are also reviewing productivity-enhancing opportunities at the Fortune Brands operations. We anticipate that this review may well result in restructuring charges during 1997. Fortune Brands Results and Outlook For the Fortune Brands operations, sales were $4.7 billion, up 8% (excluding businesses disposed in 1995), contribution from operations was $700 million, up 9%, and, on a pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma basis, E.P.S. was $1.32 per share, up 8% ($1.30 fully diluted). The pro forma calculations give effect for both years to the possible 10 million share repurchase and to the net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). resulting from the payment that Gallaher will make to Fortune Brands at the time of the spin-off. The 1995 figures exclude the distilled spirits restructuring charge and items relating to businesses sold. "Our long-term E.P.S. growth goal for Fortune Brands is in the range of 13-15%, assuming a satisfactory economic and pricing environment," Hays noted. "For the year 1997, on a pro forma basis, we expect to comfortably achieve that 13-15% E.P.S. growth goal (excluding restructuring charges), leveraobacco operations, will be a premier international consumer products company with a strong growth outlook and a formidable array of category-leading brands. This past year, about a third of non-tobacco contribution came from distilled :::Distilled spirits brands::: or the $17.8 million restructuring charge in the 1995 quarter. Benefiting from tremendous cash flow generoducts, including Jim Beam Jim Beam is a brand of bourbon whiskey, distilled in Clermont, Kentucky. This brand of whiskey has been distilled since 1795. The Jim Beam brand is owned by Beam Global Spirits & Wine, which is in turn owned by holding company Fortune Brands. , the number one bouueur brands - After Shock and Avalanche avalanche, rapidly descending large mass of snow, ice, soil, rock, or mixtures of these materials, sliding or falling in response to the force of gravity. Avalanches, which are natural forms of erosion and often seasonal, are usually classified by their content such - shipincreased by over 40% in 1996. The development of high margin new products will continue to be a key priority. In international markets, there were notable achieve number 1 spirit brand in that country, was uurbon volume nearly doubled, reaching 85,000 cformer Jim Beam and Whyte & Mackay operations into a single, globally integrated distilled spirits business. faster growth in pre-tax income. number 1 kitchen and bath faucet in North Amerithe hardware brands. Pre-tax income grew at a solid double-digit rate in 1996. Moen achieved solid a, Moen's share of the U.S. faucet market reached 26.6%, and, over the past year, Moen substantially increased its share lead over the nearest competitive brand. These results reflect the impact of highly effective advertising. At yposted particularly strong sales gains with wholesalers, reflecting continued share growth and a strong U.S.xcellent acceptance of new prod ucts. Contribue about flat in both periods, but contribution declined sharply. Results were impacted dramatically as mative, and the lower prices have been widely part the Master Lock brand. For 1997, we expect continued strong performances for Moen, Aristokraft and Waterloo Waterloo, town, Belgium Waterloo (vä`tərlō), commune (1991 pop. 27,860), Walloon Brabant prov., central Belgium, near Brussels. The battle of Waterloo (see Waterloo campaign) was fought just south of there on June 18, 1815. to more than offset the impact of the lower prices at Master Lock. We anticipate that this will result in a modest contribution gain, overall, for the hardware branwere achieved by the golf brands, both for the fourth quarter and full year, reflecting continued solid gains for Titleist and Foot-Joy as well as the January 1996 acquisition of Cobra. Contribution was up 71% and 49% in the quarter atrong acceptance of the full range of Titleist Professional, HP2 and DT golf balls and a 19% increase in unit sales unit sales Sales measured in terms of physical units rather than dollars. Unit sales data are often used by financial analysts when evaluating the health of a company. of Titleist golf clubs. Titleist was by far the num players' golf club, continued to achieve notad firmly establishing itself as a strong numbergin in both categories. In golf footwear, Foot-Joy successfully relaunched DryJoys, the world's number 1 weatherproof performance golf shoe, with a new high performance, waterproof leather system combined with thermal responsive gel the sweet spot more often. These features have also been incorporated into the Lady Cobra II irons and the Senior King Cobra II irons. At the PGA (1) (Professional Graphics Adapter) An early IBM PC display standard for 3D processing with 640x480x256 resolution. It was not widely used. (2) (Programmable Gate Array) See gate array and FPGA. Merchandise Show this week, Cobra is unveiling new King Cobra II Tour irons, designed to help better players achieve straighter, longer shots with greater control. New left-handed models of the entire product line are also being introduced. Cobra also enhanced its number 3 position in woods during 1996 with thesynergistic opportunities created by this powerful combination of golf brands, even though contribution from Cobra was lower than originally projected. In international markets, distribution of the Cobra brand is being combined with Ting from a combined R&D effort. With our array of great golf brands, we are superbly positioned to capitalize on the dynamic, worldwide growth in this category. We are particularly proud that two of the straightest, longest driven from the golf brands is likely to be down, compared with a very strong 1996 quarter for all the golf brands, with particular benefit from initial shipments of the K% for the year on record sales. Overall, ACCO ACCO American College of Chiropractic Orthopedists ACCO Association of County Commissioners of Oklahoma ACCo American Cyanamid Company ACCO Adenoid Cystic Carcinoma Organization ACCO American Clip Company ACCO Assistant Central Control Officer is the global leader in office supplies Office supplies is the generic term that refers to all supplies regularly used in offices by businesses and other organizations, from private citizens to governments, who works with the collection, refinement, and output of information (colloquially referred to as "paper work"). . In the quarter, North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. sales were up 12%, backed by broad geographic gains and a 31% increase in the key computer- related products and accessories category. Comparisons for Day- Timer timer, n radiographic timing device that functions as an automatic exposure timer and a switch to control the current to the high-tension transformer and filament transformer. The face of the timer is calibrated in seconds and fractions of seconds. , the number 1 time management brand, were negatively affected by the strong sell-in in 1995, when Day-Timer organizers were rolled out in the retail channel. At retail, however, sell- through of the Day-Timer brand was up substantially. For the year, North American sales were up 7%, but would have been up 13%, adjusting for an acquisition and divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). . Internationally, in spite of sluggish economies Sluggish Economy A state in the economy in which the growth is slow, flat or declining. The term can refer to the economy as a whole or a component of the economy, such as weak housing starts. across much of Europe, sales were up 6% for the year. Double-digit growth was posted in Ireland as well as in Australia, where we have the number 1 position and have been achieving sustained share gains. Overall, the office products sales comparisons were adversely affected by the divestiture of nonstrategic furniture operations, partly offset by the acquisition late in the year of Advanced Gravis, a leader in joysticks, game pads and high-end sound cards. Significant progress was achieved in enhancing systems to meet the needs of the consolidating customer base. These systems are enabling the organization to further improve service, reduce costs and more effectively manage working capital. With the benefit of tight cost controls, another solid improvement in the operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: was accomplished. And with continued strong focus on asset management, days sales in inventories improved by 15%. For 1997, we again expect double-digit growth in contribution from the office products brands. Gallaher Highlights Gallaher, the number 1 tobacco company in the U.K., completed another strong year. For the year, Gallaher reported record sales of 4.4 billion pounds, up 7%, and contribution (excluding a restructuring charge of 53.3 million pounds) of 367 million pounds, up 5%. In dollars, up 4%. Fourth quarter sales were a recor Worldwide cigarette unit sales increasedarette volume was up 1.5% in the quarter and 0.3ogram, a nd increased its sh are of the growing low-price sector to 11.5% for the year, up substantially from 6% in 1995. This strong increase in the low-price sector reflected a 68% volume gain for Mayfair and the introductions of Sovereign King Size in March and Sovereign Lights in November. With ongoing trading down by some consumers, the premium sector accounted for about 48.5% of the market for the year, compared with 50.6% in 1995. Export volume was up 35% in the quarter and 8% for the year, with strong volume gains in Europe Duty Free and France. For the year, in-market sales (importer sales to the trade) of Benson and Hedges in France were up 31%, helped by the launch of new Benson and Hedges American Blend. Overall in-market sales of Benson and Hedges on the Continent were up 20%. In Greece, where Silk Cut Silk Cut is brand of low tar cigarette produced by the Gallaher Group. The packaging is characterised by a distinctive stark white packet with the brand name in a purple square. Tobacco only makes up 75% of the filling; the rest is Cytrel. passed the 1 billion unit sales mark in 1995, another 9% in- market gain was achieved for the brand in 1996. Shipments to the former Soviet Union (FSU FSU Florida State University FSU Former Soviet Union FSU Ferris State University FSU Fayetteville State University (North Carolina) FSU Frostburg State University FSU Finance Sector Union ) increased 12% in the quarter but declined 17% for the year, due largely to temporary difficulties with the movement of goods within the markets. Gallaher is developing plans for construction of a manufacturing facility in Kazakhstan. In Ireland, Gallaher strengthened its market leading position, increasing its share to 44.2% for the year, up from 4idate cigarette production into one factory. The three to four year program will result in the expansion of Gallaher's factory at Lisnafillan, Northern Ireland Northern Ireland: see Ireland, Northern. Northern Ireland Part of the United Kingdom of Great Britain and Northern Ireland occupying the northeastern portion of the island of Ireland. Area: 5,461 sq mi (14,144 sq km). Population (2001): 1,685,267. , and the closure of the Hyde factory in Manchester, England. Pending the planned spin-off, we expect continued solin Old Greenwich, Connecticut. As noted, American Brands intends to change its name, following the consummation CONSUMMATION. The completion of a thing; as the consummation of marriage; (q.v.) the consummation of a contract, and the like. 2. A contract is said to be consummated, when everything to be done in relation to it, has been accomplished. of the spin-off of Gallaher, to Fortune Brands. ding 1. ding - Synonym for feep. Usage: rare among hackers, but commoner in the Real World. 2. ding - "dinged": What happens when someone in authority gives you a minor bitching about something, especially something trivial. "I was dinged for having a messy desk." market positions. Major distilled spirits brands sold by units of JBB JBB Joint Base Balad (Iraq) JBB John Benjamin Band Worldwide, Inc., include Jim Beaeading hardware and home improvement brands including Moen faucets, Master locks and Aristokraft cabinets. Acushnet Company's golf brands include Titleist, Cobra, Pis brands include Day-Timer and Swingline. Gallaher Limited sells tobacco products internationally, principally in Europe, where its major brands include Benson and Hedges and Silk Cut. This press release contains stateme uncertainties, including but not limited to changes in general economic conditions, foreign exchange rate fluctuations, competitive product and pricing pressures, the impact of excise tax Excise Tax 1. An indirect tax charged on the sale of a particular good. 2. A penalty tax applied to ineligible transactions in retirement accounts. This penalty is assessed by and paid to the IRS. Notes: 1. increases with respect to international tobacco and distilled spirits, regulatory developments, the uncertainties of litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. , as well as other risks and uncertainties detailed from time to time in the Company's AMERICAN BRANDS, INC. Three Months Ended December 31, 1996 1995 % Change 4.9 10.8 Advertising, selling, general and administrative expense Res 16.3 (0.1) 4.6 (102.2) Gain on disposal of 80.5 106.5 (24.4) Income Before Extraordinary Items 114.0 154.1 (26.0) Extraordinary items - - Earnings Per Common Share Primary Income from operations $1.01 $0.92 9.8 Restructuring charges (0.34) (0.06) - Gain on disposal of busine - - - Income before extraordinary items 0.67 0.85 (2 Extraordinary items - - - Fully Diluted Income from operations $0.98 $0.90 8.9 Income before extraordinary items 0.65 0.83 (21.7) Extraordinary items - - - Net income $0.65 $0.83 (21.7) Avg.(6.9) AMERICAN BRANDS, INC. CONSOLIDATED STATEMENT OF INCOME (In millions, except per share amounts) (Unaudited) Twelve Months Ended December 31, 1996 (1) 1995 % Change Net Sales $11,579.3 $11,367.1 1.9 Cost of sales 8,685.2 8,572.1 1.3 Advertising, selling, general a Restructuring charges 88.8 17.8 - Amortization of intangibles 107.4 95.1 12.9 r (income) expenses, net (3.6) (16.8) (78.6) Gain on disposal of businesses, net - 20.0 - Income taxes 327.5 350.7 (6.6) Income Before Extraordinary Item Extraordinary items (10.3) (2.7) - Net Inc Income from operations $3.20 $2.88 11.1 Businesses disposed - (0.02) - Restructuring charges (0.34) (0.06) - Gain on disposal of Extraordinary items (0.06) (0.01) - $2.80 $2.89 (3.1) ome from operations $3.13 $2.82 11.0 Businesses disposed - (0.01) - Restructuring charges (0.33) (0.06) - Gain on disposal of businesses - 0.09 - Income before extraordinary items 2.80 2.84 (1.4) Extraordinary items (0.06) (0.01) Avg. Common Shares Outstanding Primary 178.4 195.7 (8.8) (in mil An Internet address domain name for a military agency. See Internet address. (networking) mil - The top-level domain for entities affiliated with US armed forces. lions) NOTES: (1) All figures are subject to completion of audit. (2) Net sales by business segment: 1996 1995 %Change 6.9 Prods. Golf & Leisure Products (d) 142.3 100.5 41.6 Office Products 375.4 361.5 3.8 3,435.3 3,084.7 11.4 Businesses Disposed (e) - (0.1) - $3,435.3 $3,084.6 11.4 Twel6 1995 %Change International Tobacco (a) $6,861.6 $6,439.0 6.6 Distilled - 547.3 - $11,579.3 $11,367.1 1.9 Operating company contribution by business segment: 1996 1995 %Change International Tobacco (b) $79.8 $154.8 (48.4) Distilled Spirits (c) 61.1 58.2 5.0 Prods. (13.9) Businesses Disposed (e) - - - $290.4 $337.4 (13.9) Twelve Months Ended Dec. 31, 1996 1995 %Change International Tobacco (b) $492.9 $559.1 8.4 2.7 Prods. Golf & Leisure Products (d) 125.3 84.2 48.8 Office PrED): (a) Federal and foreign excise taxes excise taxes, governmental levies on specific goods produced and consumed inside a country. They differ from tariffs, which usually apply only to foreign-made goods, and from sales taxes, which typically apply to all commodities other than those specifically exempted. included in net sales and cost of sales: Three Months Ended Twelve Months Dec. 31, Ended Dec. 31, 1996 1995 Spirits K.-based Gallaher tobacco subsidiary will consolidate U.K. cigarette manufacturing into one factory and in the fourth quarter recorded an $88.8 , related to employee termination beith a bottling plant closing and re of $712 million in cash, including fees and expenses. The cost exceeded the fair value of net assets acquired by $657 million. Cobra's operatie date of acquisition. (e) B Housewares (Prestige sold May 2, 1995). $20 million (no taxes required) of the provision that was recorded in 1994 in connection with the disposition of nonstrategic business and product lines was reversed in the third quarter of 1995. AMERICAN BRANDS, INC. (in millions) NOTES (CONTINUED): (3) Operating company contribution and income from operations excluding restructuring charges, gain on disposal of businesses and results from businesses disposed: Operating company contribution (on a comparable basis): , 1996 1995 %Change International Tobacco $168.6 $154.8 8.9 Distilled Spirits 89.5 89.7 (0.2) Hardware & Home Improve. 61.1 58.2 5.0 Prods. Golf & Leisure Products 8.7 5.1 70.6 Office Products 51.3 47.4 8.2 $379.2 $355.2 6.8 Spirits 244.1 241.9 0.9 Hardware & Home Improve. 214.1 208.4 2.7 Prods. Golf & Leisure Products 116.3 105.5 10.2 $1,281.5 $1,199.1 6.9 Income from operations (after taxes): Dec. 31, Dec. 31, 1 Businesses disposed - (2.6) - (59.5) (12.2) - Gain on disposal of businesses - - - - 20.0 - Income before extra. i $114.0 $154.1 (26.0) $496.8 $543.1 (8.5) AMERICAN BRANDS, INC. (in m tobacco business. Completion of the transaction, which is currently expected around mid-year, is ers will own shares in two publicly-traded companies - Gallaher and Fortune Brands. To allocate the overall debt burden of the Company at the time of the spin-off, Gallaher will borrow and pay to Fortune Brands approximately $1.4 billion. Fortune will use the proceeds (approximately $1.25 billion after taxes) initially to pay down short-term debt Short-term debt Debt obligations, recorded as current liabilities, requiring payment within the year. . The Gallaher debt will be in addition to its seasonal wo exchange rate, the existing $2.00 per share A merican Brands dividend. U.S. and eligible U.K. taxpayers will effectively receive about another 30 cents, or 15%, for a total of about $2.30. This added benefit comes in the form of a refund or credit of the U.K. Advance Corporation Tax that is paid by Gallaher on its dividends. U.S. taxpayers will be entitled en·ti·tle tr.v. en·ti·tled, en·ti·tling, en·ti·tles 1. To give a name or title to. 2. To furnish with a right or claim to something: to a cash refund of the A.C.T. paid by Gallaher less applicable U.K. withholding taxes The amount legally deducted from an employee's wages or salary by the employer, who uses it to prepay the charges imposed by the government on the employee's yearly earnings. which can be credited against their U.S. income tax liability. The U.S. be determined by, and be at the discretipin-off dividend payable by Gallaher in rher shareholder approval, payable in 1998. e Months Ended December 31, 1996 1995 %Change Primary Fully Diluted $1.30ion is consummated. -- of net proceeds resulting from the payment Gallaher will make to Fortune ny redeemed its $150 million 7- 5/8% Eurts $150 million 9-1/8% Debentures, Due 2016, at a redemption price Redemption price See: Call price redemption price 1. The price at which an open-end investment company will buy back its shares from the owners. In most cases, the redemption price is the net asset value per share. 2. of 104.4375% of the princi of $10.3 million ($15.8 million pre-tax), or six cents per common share, and reduced the number of fully diluted shares outstanding by 2.8 million. 114.74% plus accrued interest Accrued Interest The interest that has accumulated on a bond since the last interest payment up to but not including the settlement date. There are two methods for calculating accrued interest: 1) 360-day year method, used for corporate and municipal bonds. . This resulted i charge of $2.7 million ($4.1 million pre-tax), or one cent per common share, and reduced the number of fully diluted shares outstanding by 5.1 million. (7) The Company and its subsidiaries are defendants in various lawsuits associated with their business and operations, including actions based upon allegations that human ailments have resulted from tobacco use. It is not possible to predict the outcome of the pending litigation, but management believes that there are meritorious mer·i·to·ri·ous adj. Deserving reward or praise; having merit. [Middle English, from Latin merit defenses to the pending actions and that the pending actions will not have a material adverse effect upon the results of operations, cash flow or financial condition of the Company. These actions are being vigorously contested. On December 22, 1994, the Company sold The American Tobacco Company subsidiary to Brown & Williamson Tobacco Corporation, a wholly-owned subsidiary of B.A.T Industries p.l.c. In connection with the sale, Brown & Williamson Tobacco CorporaCompany against claims arising from smoking and health and fire safe cigarette safe cigarette Tobacco control An oxymoron for a cigarette–firesafe, low-tar, smokeless, said to ↓ risks–CA, emphysema, COPD, etc, associated with tobacco use. See Eclipse, Premier. matters relating to the tobacco business of The American Tobacco Company. AMERICAN BRANDS, INC. CONDENSED con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. CONSOLIDATED BALANCE SHEET consolidated balance sheet A balance sheet in which assets and liabilities of a parent company and its controlled subsidiaries are combined, thereby presenting balance sheet items for the parent and its subsidiaries as if they were a single firm. (In millions) December Cash and Cash Equivalents $119.7 $139.9 Accounts Receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying , Net 1,125.0 984.4 Inventories 2,256.2 1,840.2 Other Current Assets Other Current Assets A balance sheet item that includes the value of non-cash assets due within one year. Notes: Examples are things like prepaid expenses and accounts receivable. 372.5 199.5 -------- -------- Total Current Assets Current Assets Appearing on a company's balance sheet, it represents cash, accounts receivable, inventory, marketable securities, prepaid expenses, and other assets that can be converted to cash within one year. 3,873.4 3,164.0 Property, Plant and Equipment, Net 1,230.9 1,137.3 Intangibles Resulting From Business Acquisitions, Net 3,936.4 3,305.2 Other Assets other assets Assets of relatively small value. For financial reporting purposes, firms frequently combine small assets into a single category rather than listing each item separately. 463.5 414.7 -------- -------- Total Assets $9,504.2 $8,021.2 ========= ========= Liabilities and Stockholders' Equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. Current Liabilities Current Liabilities Usually appearing on a company's balance sheet, it represents the amount owed for interest, accounts payable, short-term loans, expenses incurred but unpaid, and other debts due within one year. Short-Term Debt $1,405.8 $297.4 Current Portion - Long-Term Debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. 53.9 413.4 Other Current Liabilities Other Current Liabilities A balance sheet entry used by companies to group together current liabilities that are not assigned to common liabilities such as debt obligations or accounts payable. Long-Term Debt tal Liabilities 5,820.0 4,144.0 Stockholders' Equity 3,684.2 3,877.2 -------- -------- Total Liabilities and Stockholders' Equity $9,504.2 $8,021.2 ========= ========= CONTACT: American Brands, Inc., Old Greenwich Media Relations: Investor Relations Investor relations The process by which the corporation communicates with its investors. : Roger W. W. Baker Daniel A.Conforti (203) 698-5148 (203) 698-5132 |
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