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 DAYTON, Ohio, April 20 /PRNewswire/ --- Mead Corporation (NYSE: MEA) today reported first quarter net earnings of $25.6 million, or 43 cents per share.
 Mead originally reported net earnings of $17.7 million, or 31 cents per share, for the first quarter of 1992, but adoption later in the year of FASB statement No. 109, related to accounting for income taxes, resulted in restatement of net earnings to $51.7 million or 86 cents per share.
 Mead's first quarter sales were $1.14 billion, 4 percent higher than the $1.09 billion in sales reported for the same period in 1992.
 "Nearly all of our businesses achieved higher sales in the first quarter, despite the challenge presented by weak pricing," said Steven C. Mason, chairman and chief executive officer. "Many achieved higher earnings, as well, through strong operating performance and tight cost control."
 Significant earnings improvement was attributable to higher prices for lumber, plywood and oriented structural board sold by Mead's jointly-owned investees, Northwood Forest Industries and Northwood Panelboard Co. Higher solid wood products prices more than offset the negative impact of lower prices for Northwood's northern bleached softwood kraft pulp.
 Earnings from Mead's paper businesses were higher than a year ago, although prices were lower for both coated and uncoated grades. The increase in earnings was chiefly due to improved operations at the company's publishing paper mill at Escanaba, Mich., which had experienced operating problems during the first half of 1992. Improved operating performance at both the Escanaba and Chillicothe, Ohio, mills helped boost production volumes and sales for the segment.
 Higher production volume also led to increased sales and earnings for Mead's packaging and paperboard segment. Productivity improvements at Mead's expanded coated board mill in Alabama raised production volume nearly 12 percent over the same period a year ago. Mead Coated Board continues to place this additional tonnage in both the beverage and folding carton markets.
 Mead Containerboard achieved substantial growth in converting volumes at its corrugated container plants as a result of targeted marketing efforts begun last year. This growth, along with strong operating performance by the division's Stevenson, Ala., mill, more than offset the negative impact of reduced corrugating medium prices.
 Mead's distribution and school and office products segment reported higher earnings for the quarter, reflecting higher unit sales, stable prices and improved operating margins. The introduction of new product lines boosted sales of school and office suppld?uring the quarter, while Zellerbach's revenues were up slightly due to increased sales of packaging materials and industrial supplies. Sales for the distribution and school and office products segment were flat compared to the prior year, however, due to reduced revenue resulting from the sale of Ampad in July 1992.
 Earnings from the company's electronic publishing subsidiary, Mead Data Central, Inc. (MDC), were lower for the quarter, despite an eight percent increase in sales. This was due to the write-off of $3.2 million in capitalized software development costs, as well as increased spending on market development. The previously capitalized costs were associated with the development of software used to connect customers' computers with MDC's electronic libraries. With the acquisition of Folio Corporation, MDC gained superior technology which it plans to integrate into future software development.
 Looking ahead to the second quarter, Mason commented, "Despite a few price improvements, we only see mixed signs of a rebound in the marketplace. However, the results of our performance improvement efforts are encouraging. The changes we are making had a positive impact on first quarter results and will become more evident in the future as adverse market conditions improve."
 (All dollar amounts in millions, except per share amounts)
 First Qtr. Ended
 Apr. 4, Mar. 29,
 1993 1992
 Net sales $1,135.5 $1,088.2
 Cost of products sold 910.6 887.7
 Gross profit 224.9 200.5
 Selling, administrative and
 research expenses 170.8 157.4
 Earnings from operations 54.1 43.1
 Other revenues - net .8 8.8
 Interest and debt expense (24.4) (25.8)
 Earnings before income taxes 30.5 26.1
 Income taxes 11.7 9.9
 Earnings before equity in net
 earnings of investees 18.8 16.2
 Equity in net earnings of investees 6.8 1.5
 Earnings before cumulative effect of
 change in accounting principle 25.6 17.7
 Cumulative effect of change in
 accounting principle 34.0
 Net earnings $ 25.6 $ 51.7
 Per common and common equivalent
 Earnings before cumulative effect
 of change in accounting principle $ .43 $ .31
 Cumulative effect of change in
 accounting principle .55
 Net earnings $ .43 $ .86
 Cash dividends per common share $ .25 $ .25
 Average common and common equivalent
 shares outstanding (millions) (A) 59.4 61.5
 (A) --The number of shares used in the calculation of per share data varies from period to period since stock options and convertible debentures are included in the calculations only for the periods in which they are dilutive.
 (All dollar amounts in millions)
 Apr. 4, Dec. 31,
 1993 1992
 Current assets:
 Cash and cash equivalents $ 16.9 $ 18.4
 Accounts receivable 604.1 582.1
 Inventories 481.1 425.9
 Other current assets 89.3 103.0
 Total current assets 1,191.4 1,129.4
 Investments and other assets:
 Investments in and advances to investees 65.2 58.9
 Other assets 501.0 493.0
 566.2 551.9
 Property, plant and equipment 4,178.4 4,135.6
 Less accumulated amortization and
 depreciation (1,841.1) (1,785.5)
 2,337.3 2,350.1
 Total assets $4,094.9 $4,031.4
 Current liabilities:
 Notes payable $ 120.4 $
 Accounts payable 290.8 364.7
 Accrued liabilities 343.5 354.5
 Current maturities of long-term debt 11.6 10.7
 Total current liabilities 766.3 729.9
 Long-term debt 1,332.3 1,332.3
 Deferred items 485.4 473.8
 Shareowners' equity:
 Common shares 175.7 175.2
 Additional paid-in capital 17.2 12.3
 Foreign currency translation adjustment (1.6) (.8)
 Retained earnings 1,319.6 1,308.7
 1,510.9 1,495.4
 Total liabilities and shareowners'
 equity $4,094.9 $4,031.4
 Increase (decrease) in cash and cash equivalents
 (All dollar amounts in millions)
 First Qtr. Ended
 Apr. 4, Mar. 29,
 1993 1992
 Cash flows from operating activities:
 Net earnings $ 25.6 $ 51.7
 Adjustments to reconcile net earnings to net
 cash (used in) operating activities:
 Depreciation, amortization and depletion
 of property, plant and equipment 63.7 59.5
 Depreciation and amortization of other
 assets 13.2 13.5
 Cumulative effect of change in accounting
 principle (34.0)
 Other (4.1) (12.9)
 Change in assets and liabilities:
 Accounts receivable (26.4) (42.6)
 Inventories (55.2) (51.3)
 Other current assets 13.1 (4.5)
 Accounts payable and accrued liabilities (84.9) (35.5)
 Net cash (used in) operating
 activities (47.5) (53.7)
 Cash flows from financing activities:
 Additional borrowings 187.9
 Payments on borrowings (187.3)
 Notes payable 120.4 74.3
 Cash dividends paid (14.7) (14.6)
 Common shares issued 5.4 6.4
 Net cash provided by financing
 activities 111.7 66.1
 Cash flows from investing activities:
 Capital expenditures (52.4) (40.4)
 Additions to equipment rented to others (9.8) (14.5)
 Proceeds from sale of subsidiaries 45.0
 Investments in and advances to investees (.3) 1.2
 Other (3.5) 3.0
 Net cash (used in) investing activities (66.0) (5.7)
 Net cash (used in) provided by con-
 tinuing operations (1.8) 6.7
 Cash provided by (used in) discontinued
 operations .3 (1.0)
 Increase in cash and cash equivalents (1.5) 5.7
 Cash and cash equivalents at beginning of year 18.4 24.6
 Cash and cash equivalents at end of quarter $ 16.9 $ 30.3
 -0- 4/20/93
 /CONTACT: Sharon Williamson of The Mead Corporation, 513-495-3535/

CO: The Mead Corporation ST: Ohio IN: PAP SU: ERN

BM -- CL006 -- 7809 04/20/93 08:56 EDT
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Date:Apr 20, 1993

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