x
|
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF
1934
|
COMMONWEALTH
OF PENNSYLVANIA
|
25-0644320
|
(State
or other jurisdiction of
|
(I.R.S.
Employer
|
incorporation
or organization)
|
Identification
No.)
|
TWO
NORTHSHORE CENTER, PITTSBURGH, PA
|
15212-5851
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Registrant's
telephone number, including area code
|
(412)
442-8200
|
Title
of each class
|
Name
of each exchange on which registered
|
|
Class
A Common Stock, $1.00 par value
|
NASDAQ
National Market System
|
ITEM
1.
|
BUSINESS.
|
ITEM
1.
|
BUSINESS,
continued
|
Years
Ended September 30,
|
||||||||||||||||||||||||
2007
|
2006
|
2005
|
||||||||||||||||||||||
Amount
|
Percent
|
Amount
|
Percent
|
Amount
|
Percent
|
|||||||||||||||||||
(Dollars
in Thousands)
|
||||||||||||||||||||||||
Sales
to unaffiliated customers:
|
||||||||||||||||||||||||
Memorialization:
|
||||||||||||||||||||||||
Bronze
|
$ |
229,850
|
30.7 | % | $ |
218,004
|
30.4 | % | $ |
205,675
|
32.1 | % | ||||||||||||
Casket
|
210,673
|
28.1
|
200,950
|
28.1
|
135,512
|
21.2
|
||||||||||||||||||
Cremation
|
25,166
|
3.3
|
25,976
|
3.6
|
21,497
|
3.4
|
||||||||||||||||||
465,689
|
62.1
|
444,930
|
62.1
|
362,684
|
56.7
|
|||||||||||||||||||
Brand
Solutions:
|
||||||||||||||||||||||||
Graphics
Imaging
|
146,049
|
19.5
|
140,886
|
19.7
|
143,159
|
22.4
|
||||||||||||||||||
Marking
Products
|
57,450
|
7.7
|
52,272
|
7.3
|
45,701
|
7.1
|
||||||||||||||||||
Merchandising
Solutions
|
80,164
|
10.7
|
77,803
|
10.9
|
88,278
|
13.8
|
||||||||||||||||||
283,663
|
37.9
|
270,961
|
37.9
|
277,138
|
43.3
|
|||||||||||||||||||
Total
|
$ |
749,352
|
100.0 | % | $ |
715,891
|
100.0 | % | $ |
639,822
|
100.0 | % | ||||||||||||
Operating
profit:
|
||||||||||||||||||||||||
Memorialization:
|
||||||||||||||||||||||||
Bronze
|
$ |
66,298
|
59.3 | % | $ |
65,049
|
57.1 | % | $ |
59,722
|
60.7 | % | ||||||||||||
Casket
|
11,801
|
10.6
|
16,971
|
14.9
|
12,645
|
12.8
|
||||||||||||||||||
Cremation
|
3,631
|
3.2
|
3,372
|
3.0
|
701
|
.7
|
||||||||||||||||||
81,730
|
73.1
|
85,392
|
75.0
|
73,068
|
74.2
|
|||||||||||||||||||
Brand
Solutions:
|
||||||||||||||||||||||||
Graphics
Imaging
|
14,439
|
12.9
|
16,554
|
14.5
|
14,861
|
15.1
|
||||||||||||||||||
Marking
Products
|
9,931
|
8.9
|
9,066
|
8.0
|
7,373
|
7.5
|
||||||||||||||||||
Merchandising
Solutions
|
5,724
|
5.1
|
2,872
|
2.5
|
3,111
|
3.2
|
||||||||||||||||||
30,094
|
26.9
|
28,492
|
25.0
|
25,345
|
25.8
|
|||||||||||||||||||
Total
|
$ |
111,824
|
100.0 | % | $ |
113,884
|
100.0 | % | $ |
98,413
|
100.0 | % |
ITEM
1.
|
BUSINESS,
continued
|
ITEM
2.
|
PROPERTIES.
|
Location
|
Description
of Property
|
Square
Feet
|
||
Bronze:
|
||||
Pittsburgh,
PA
|
Manufacturing
/ Division Offices
|
97,000
|
||
Kingwood,
WV
|
Manufacturing
|
121,000
|
||
Melbourne,
Australia
|
Manufacturing
|
26,000(1)
|
||
Parma,
Italy
|
Manufacturing
/ Warehouse
|
231,000(1)
|
||
Searcy,
AR
|
Manufacturing
|
113,000
|
||
Seneca
Falls, NY
|
Manufacturing
|
21,000
|
||
Casket
(3):
|
||||
Monterrey,
Mexico
|
Manufacturing
|
178,000(1)
|
||
Richmond,
IN
|
Manufacturing
|
55,000(1)
|
||
Richmond,
IN
|
Manufacturing
/ Metal Stamping
|
92,000
|
||
Richmond,
IN
|
Injection
Molding
|
18,000(1)
|
||
York,
PA
|
Manufacturing
|
307,000
|
||
Cremation:
|
||||
Apopka,
FL
|
Manufacturing
/ Division Offices
|
40,000
|
||
Richmond,
IN
|
Manufacturing
|
129,000(1)
|
||
Graphics
Imaging:
|
||||
Pittsburgh,
PA
|
Manufacturing
/ Division Offices
|
56,000
|
||
Julich,
Germany
|
Manufacturing
/ Division Offices
|
24,000
|
||
Atlanta,
GA
|
Manufacturing
|
16,000
|
||
Beverly,
MA
|
Manufacturing
|
14,500(1)
|
||
Dallas,
TX
|
Manufacturing
|
15,000(1)
|
||
Denver,
CO
|
Manufacturing
|
12,000(1)
|
||
Goslar,
Germany
|
Manufacturing
|
39,000(1)
|
||
Kansas
City, MO
|
Manufacturing
|
42,000(1)
|
||
Leeds,
England
|
Manufacturing
|
64,000(1)
|
||
Munich,
Germany
|
Manufacturing
|
10,000(1)
|
||
Nuremberg,
Germany
|
Manufacturing
|
27,000(1)
|
||
Oakland,
CA
|
Manufacturing
|
21,000(1)
|
||
St.
Louis, MO
|
Manufacturing
|
25,000
|
||
Vienna,
Austria
|
Manufacturing
|
38,000(1)
|
||
Marking
Products:
|
||||
Pittsburgh,
PA
|
Manufacturing
/ Division Offices
|
85,000
|
||
Gothenburg,
Sweden
|
Manufacturing
/ Distribution
|
28,000(1)
|
||
Tualatin,
OR
|
Manufacturing
|
15,000(1)
|
||
Beijing,
China
|
Manufacturing
|
100,000(1)
|
||
Merchandising
Solutions:
|
||||
East
Butler, PA
|
Manufacturing
/ Division Offices
|
630,000(2)
|
||
Corporate
Office:
|
||||
Pittsburgh,
PA
|
General
Offices
|
48,000
|
(1)
|
These
properties are leased by the Company under operating lease arrangements.
Rent expense incurred by the Company for all leased facilities was
approximately $12.4 million in fiscal
2007.
|
(2)
|
Approximately
ten percent of this building is leased to unrelated
parties.
|
(3)
|
In
addition to the properties listed, the Casket division leases warehouse
facilities totaling approximately 789,000 square feet in 21 states
under
operating leases.
|
ITEM
2.
|
PROPERTIES,
continued
|
ITEM
3.
|
LEGAL
PROCEEDINGS.
|
Name
|
Age
|
Positions
with Registrant
|
||
Joseph
C. Bartolacci
|
47
|
President
and Chief Executive Officer
|
||
David
F. Beck
|
55
|
Controller
|
||
David
J. DeCarlo
|
62
|
Vice
Chairman
|
||
C.
Michael Dempe
|
51
|
Chief
Operating Officer, Cloverleaf Group, Inc.
|
||
James
P. Doyle
|
56
|
Group
President, Memorialization
|
||
Brian
J. Dunn
|
50
|
Group
President, Graphics and Marking Products
|
||
Steven
F. Nicola
|
47
|
Chief
Financial Officer, Secretary
|
||
and
Treasurer
|
||||
Timothy
S. O’Brien
|
43
|
President,
Bronze Division
|
||
Paul
F. Rahill
|
50
|
President,
Cremation Division
|
||
Franz
J. Schwarz
|
59
|
President,
Graphics Europe
|
||
ITEM
5.
|
MARKET
FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS.
|
High
|
Low
|
Close
|
||||||||||
Fiscal
2007:
|
||||||||||||
Quarter
ended:
September 30, 2007
|
$ |
48.22
|
$ |
36.76
|
$ |
43.80
|
||||||
June
30, 2007
|
44.97
|
37.61
|
43.61
|
|||||||||
March
31, 2007
|
42.35
|
38.13
|
40.70
|
|||||||||
December
31, 2006
|
41.75
|
35.13
|
39.35
|
|||||||||
Fiscal
2006:
|
||||||||||||
Quarter
ended: September 30,
2006
|
$ |
38.25
|
$ |
31.02
|
$ |
36.79
|
||||||
June
30, 2006
|
38.32
|
33.21
|
34.47
|
|||||||||
March
31, 2006
|
39.98
|
35.03
|
38.26
|
|||||||||
December
31, 2005
|
40.49
|
34.25
|
36.41
|
ITEM
5.
|
MARKET
FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
(continued)
|
Period
|
Total
number of shares purchased
|
Average
price paid per share
|
Total
number of shares purchased as part of a publicly announced
plan
|
Maximum
number of shares that may yet be purchased under the plan
(1)
|
||||||||||||
October
2006
|
-
|
$ |
-
|
-
|
864,854
|
|||||||||||
November
2006
|
60,000
|
38.00
|
60,000
|
804,854
|
||||||||||||
December
2006
|
-
|
-
|
-
|
804,854
|
||||||||||||
January
2007
|
11,500
|
39.64
|
11,500
|
793,354
|
||||||||||||
February
2007
|
8,300
|
40.30
|
8,300
|
785,054
|
||||||||||||
March
2007
|
271,900
|
39.54
|
271,900
|
513,154
|
||||||||||||
April
2007
|
130,000
|
41.95
|
130,000
|
2,883,154
|
||||||||||||
May
2007
|
335,604
|
43.22
|
335,604
|
2,547,550
|
||||||||||||
June
2007
|
96,747
|
43.28
|
96,747
|
2,450,803
|
||||||||||||
July
2007
|
210,000
|
39.28
|
210,000
|
2,240,803
|
||||||||||||
August
2007
|
205,196
|
40.91
|
205,196
|
2,035,607
|
||||||||||||
September
2007
|
37,050
|
42.09
|
37,050
|
1,998,557
|
||||||||||||
Total
|
1,366,297
|
$ |
41.11
|
1,366,297
|
ITEM
6.
|
SELECTED
FINANCIAL DATA.
|
Years
Ended September 30,
|
||||||||||||||||||||
2007(1)
|
2006
(2)
|
2005
|
2004
|
2003
(3)
|
||||||||||||||||
(Amounts
in thousands, except per share data)
|
||||||||||||||||||||
(Not
Covered by Report of Independent Registered Public Accounting
Firm)
|
||||||||||||||||||||
Net
sales
|
$ |
749,352
|
$ |
715,891
|
$ |
639,822
|
$ |
508,801
|
$ |
458,865
|
||||||||||
Gross
profit
|
280,457
|
271,933
|
223,075
|
193,754
|
170,302
|
|||||||||||||||
Operating
profit
|
111,824
|
113,884
|
98,413
|
95,078
|
77,816
|
|||||||||||||||
Interest
expense
|
8,119
|
6,995
|
2,966
|
1,998
|
2,852
|
|||||||||||||||
Income
before income taxes
|
103,716
|
105,408
|
93,056
|
89,117
|
71,086
|
|||||||||||||||
Income
taxes
|
38,990
|
38,964
|
34,985
|
34,584
|
27,582
|
|||||||||||||||
Net
income
|
$ |
64,726
|
$ |
66,444
|
$ |
58,071
|
$ |
54,533
|
$ |
43,504
|
||||||||||
Earnings
per common share:
|
||||||||||||||||||||
Diluted
|
$2.04
|
$2.06
|
$1.79
|
$1.68
|
$1.35
|
|||||||||||||||
Basic
|
2.05
|
2.08
|
1.81
|
1.69
|
1.37
|
|||||||||||||||
Weighted-average
common
|
||||||||||||||||||||
shares
outstanding:
|
||||||||||||||||||||
Basic
|
31,566
|
31,999
|
32,116
|
32,217
|
31,686
|
|||||||||||||||
Diluted
|
31,680
|
32,252
|
32,381
|
32,542
|
32,147
|
|||||||||||||||
Cash
dividends per share
|
$.225
|
$.205
|
$.185
|
$.165
|
$.123
|
|||||||||||||||
Total
assets
|
$ |
771,069
|
$ |
716,090
|
$ |
665,455
|
$ |
533,432
|
$ |
443,294
|
||||||||||
Long-term
debt, non-current
|
142,273
|
120,289
|
118,952
|
54,389
|
57,023
|
(1)
|
Fiscal
2007 included a net pre-tax charge of approximately $8,765 which
consisted
of a pre-tax charge of approximately $9,373 related to the acceleration
of
earn-out payments in the resolution of employment agreements from
the
Milso Industries acquisition and pre-tax charges of $3,515 primarily
related to severance costs incurred in several of the Company’s segments,
partially offset by a pre-tax gain of $1,322 on the sale of the
merchandising consulting business in the Merchandising Solutions
segment
and favorable legal settlements, net of related legal costs incurred,
of
approximately $2,801.
|
(2)
|
Fiscal
2006 included a net pre-tax gain of $1,016 which consisted of a pre-tax
gain of $2,670 from the sale of a facility and a pre-tax charge of
approximately $1,654 related to asset impairments and related
costs.
|
(3)
|
Fiscal
2003 included a net pre-tax charge of approximately $1,000 which
consisted
of a pre-tax gain of $2,600 on the sale of a facility and a goodwill
impairment charge of $3,600.
|
ITEM
7.
|
MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.
|
Years
Ended
|
||||||||||||||||||||
September
30,
|
Percentage
Change
|
|||||||||||||||||||
2007-
|
2006-
|
|||||||||||||||||||
2007
|
2006
|
2005
|
2006
|
2005
|
||||||||||||||||
Sales
|
100.0 | % | 100.0 | % | 100.0 | % | 4.7 | % | 11.9 | % | ||||||||||
Gross
profit
|
37.4
|
38.0
|
34.9
|
3.1
|
21.9
|
|||||||||||||||
Operating
profit
|
14.9
|
15.9
|
15.4
|
(1.8 | ) |
15.7
|
||||||||||||||
Income
before taxes
|
13.8
|
14.7
|
14.5
|
(1.6 | ) |
13.3
|
||||||||||||||
Net
income
|
8.6
|
9.3
|
9.1
|
(2.6 | ) |
14.4
|
Date
|
Initial
Amount
|
Fixed
Interest Rate
|
Interest
Rate Spread at September 30, 2007
|
Equal
Quarterly Payments
|
Maturity
Date
|
|||||||||
April
2004
|
$50
million
|
2.66 | % | .40 | % |
$2.5
million
|
April
2009
|
|||||||
September
2005
|
50
million
|
4.14
|
.40
|
3.3 million
|
April
2009
|
|||||||||
August
2007
|
15
million
|
5.07
|
.40
|
-
|
April
2009
|
|||||||||
August
2007
|
10
million
|
5.07
|
.40
|
-
|
April
2009
|
|||||||||
September
2007
|
25
million
|
4.77
|
.40
|
-
|
September
2012
|
Payments
due in fiscal year:
|
||||||||||||||||||||
After
|
||||||||||||||||||||
Total
|
2008
|
2009
to 2010
|
2011
to 2012
|
2012
|
||||||||||||||||
Contractual
Cash Obligations:
|
(Dollar
amounts in thousands)
|
|||||||||||||||||||
Revolving
credit facilities
|
$ |
159,240
|
$ |
23,333
|
$ |
28,907
|
$ |
107,000
|
$ |
-
|
||||||||||
Notes
payable to banks
|
7,332
|
1,005
|
2,924
|
2,342
|
1,061
|
|||||||||||||||
Short-term
borrowings
|
2,068
|
2,068
|
-
|
-
|
-
|
|||||||||||||||
Capital
lease obligations
|
711
|
664
|
41
|
6
|
-
|
|||||||||||||||
Non-cancelable
operating leases
|
27,999
|
8,526
|
9,803
|
6,506
|
3,164
|
|||||||||||||||
Total
contractual cash obligations
|
$ |
197,350
|
$ |
35,596
|
$ |
41,675
|
$ |
115,854
|
$ |
4,225
|
Date
|
Initial
Amount
|
Fixed
Interest Rate
|
Interest
Rate Spread at September 30, 2007
|
Equal
Quarterly Payments
|
Maturity
Date
|
|||||||||
April
2004
|
$50
million
|
2.66 | % | .40 | % |
$2.5
million
|
April
2009
|
|||||||
September
2005
|
50
million
|
4.14
|
.40
|
3.3 million
|
April
2009
|
|||||||||
August
2007
|
15
million
|
5.07
|
.40
|
-
|
April
2009
|
|||||||||
August
2007
|
10
million
|
5.07
|
.40
|
-
|
April
2009
|
|||||||||
September
2007
|
25
million
|
4.77
|
.40
|
-
|
September
2012
|
Description
|
Pages
|
|
Management’s
Report to Shareholders
|
34
|
|
Report
of Independent Registered Public Accounting Firm
|
35
|
|
Financial
Statements:
|
||
Consolidated
Balance Sheets as of September 30, 2007 and 2006
|
36-37
|
|
Consolidated
Statements of Income for the years ended September 30, 2007, 2006
and
2005
|
38
|
|
Consolidated
Statements of Shareholders' Equity for the years ended September
30, 2007,
2006 and 2005
|
39
|
|
Consolidated
Statements of Cash Flows for the years ended September 30, 2007,
2006 and
2005
|
40
|
|
Notes
to Consolidated Financial Statements
|
41-62
|
|
Supplementary
Financial Information (unaudited)
|
63
|
|
Financial
Statement Schedule – Schedule II-Valuation and Qualifying
|
||
Accounts
for the years ended September 30, 2007, 2006 and 2005
|
64
|
ASSETS
|
2007
|
2006
|
||||||
Current
assets:
|
||||||||
Cash
and cash equivalents
|
$ |
44,002
|
$ |
29,720
|
||||
Short-term
investments
|
105
|
92
|
||||||
Accounts
receivable, net of allowance for doubtful
accounts
of $11,160 and $10,829, respectively
|
120,882
|
121,750
|
||||||
Inventories
|
93,834
|
85,415
|
||||||
Deferred
income taxes
|
1,666
|
1,682
|
||||||
Other
current assets
|
6,025
|
4,184
|
||||||
Total
current assets
|
266,514
|
242,843
|
||||||
Investments
|
12,044
|
11,492
|
||||||
Property,
plant and equipment, net
|
88,926
|
88,099
|
||||||
Deferred
income taxes
|
23,311
|
24,441
|
||||||
Other
assets
|
10,670
|
6,125
|
||||||
Goodwill
|
318,298
|
298,125
|
||||||
Other
intangible assets, net
|
51,306
|
44,965
|
||||||
Total
assets
|
$ |
771,069
|
$ |
716,090
|
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
2007
|
2006
|
||||||
Current
liabilities:
|
||||||||
Long-term
debt, current maturities
|
$ |
27,057
|
$ |
28,451
|
||||
Trade
accounts payable
|
22,859
|
26,925
|
||||||
Accrued
compensation
|
31,205
|
33,517
|
||||||
Accrued
income taxes
|
5,792
|
9,230
|
||||||
Other
current liabilities
|
36,543
|
39,086
|
||||||
Total
current liabilities
|
123,456
|
137,209
|
||||||
Long-term
debt
|
142,273
|
120,289
|
||||||
Accrued
pension
|
23,629
|
17,720
|
||||||
Postretirement
benefits
|
20,743
|
17,422
|
||||||
Deferred
income taxes
|
11,799
|
9,942
|
||||||
Environmental
reserve
|
7,841
|
9,028
|
||||||
Other
liabilities and deferred revenue
|
14,550
|
12,055
|
||||||
Commitments
and contingent liabilities
|
||||||||
Shareholders'
equity:
|
||||||||
Class
A common stock, $1.00 par value; authorized
70,000,000
shares; 36,333,992 shares issued
|
36,334
|
36,334
|
||||||
Preferred
stock, $100 par value, authorized 10,000 shares, none
issued
|
-
|
-
|
||||||
Additional
paid-in capital
|
41,570
|
33,953
|
||||||
Retained
earnings
|
467,846
|
410,203
|
||||||
Accumulated
other comprehensive income
|
13,390
|
4,386
|
||||||
Treasury
stock, 5,276,830 and 4,699,697 shares, respectively, at
cost
|
(132,362 | ) | (92,451 | ) | ||||
Total
shareholders' equity
|
426,778
|
392,425
|
||||||
Total
liabilities and shareholders' equity
|
$ |
771,069
|
$ |
716,090
|
2007
|
2006
|
2005
|
||||||||||
Sales
|
$ |
749,352
|
$ |
715,891
|
$ |
639,822
|
||||||
Cost
of sales
|
(468,895 | ) | (443,958 | ) | (416,747 | ) | ||||||
Gross
profit
|
280,457
|
271,933
|
223,075
|
|||||||||
Selling
expense
|
(71,623 | ) | (70,354 | ) | (59,484 | ) | ||||||
Administrative
expense
|
(97,010 | ) | (87,695 | ) | (65,178 | ) | ||||||
Operating
profit
|
111,824
|
113,884
|
98,413
|
|||||||||
Investment
income
|
2,390
|
1,420
|
1,726
|
|||||||||
Interest
expense
|
(8,119 | ) | (6,995 | ) | (2,966 | ) | ||||||
Other
income, net
|
354
|
70
|
1,658
|
|||||||||
Minority
interest
|
(2,733 | ) | (2,971 | ) | (5,775 | ) | ||||||
Income
before income taxes
|
103,716
|
105,408
|
93,056
|
|||||||||
Income
taxes
|
(38,990 | ) | (38,964 | ) | (34,985 | ) | ||||||
Net
income
|
$ |
64,726
|
$ |
66,444
|
$ |
58,071
|
||||||
Earnings
per share:
|
||||||||||||
Basic
|
$2.05
|
$2.08
|
$1.81
|
|||||||||
Diluted
|
$2.04
|
$2.06
|
$1.79
|
Accumulated
|
||||||||||||||||||||||||
Other
|
||||||||||||||||||||||||
Additional
|
Comprehensive
|
|||||||||||||||||||||||
Common
|
Paid-in
|
Retained
|
Income
(Loss)
|
Treasury
|
||||||||||||||||||||
Stock
|
Capital
|
Earnings
|
(net
of tax)
|
Stock
|
Total
|
|||||||||||||||||||
Balance,
September 30, 2004
|
$ |
36,334
|
$ |
24,859
|
$ |
298,165
|
$ |
11,538
|
$ | (55,756 | ) | $ |
315,140
|
|||||||||||
Net
income
|
-
|
-
|
58,071
|
-
|
-
|
58,071
|
||||||||||||||||||
Unrealized
gains (losses)
|
-
|
-
|
-
|
(28 | ) |
-
|
(28 | ) | ||||||||||||||||
Minimum
pension liability
|
-
|
-
|
-
|
(9,833 | ) |
-
|
(9,833 | ) | ||||||||||||||||
Translation
adjustment
|
-
|
-
|
-
|
(3,676 | ) |
-
|
(3,676 | ) | ||||||||||||||||
Fair
value of derivatives
|
-
|
-
|
-
|
640
|
-
|
640
|
||||||||||||||||||
Total
comprehensive income
|
45,174
|
|||||||||||||||||||||||
Stock-based
compensation
|
-
|
2,874
|
-
|
-
|
-
|
2,874
|
||||||||||||||||||
Treasury
stock transactions:
|
||||||||||||||||||||||||
Purchase
of 792,728 shares
|
-
|
-
|
-
|
-
|
(27,933 | ) | (27,933 | ) | ||||||||||||||||
Issuance
of 408,846 shares under stock plans
|
-
|
1,791
|
-
|
-
|
6,628
|
8,419
|
||||||||||||||||||
Dividends,
$.185 per share
|
-
|
-
|
(5,925 | ) |
-
|
-
|
(5,925 | ) | ||||||||||||||||
Balance,
September 30, 2005
|
36,334
|
29,524
|
350,311
|
(1,359 | ) | (77,061 | ) |
337,749
|
||||||||||||||||
Net
income
|
-
|
-
|
66,444
|
-
|
-
|
66,444
|
||||||||||||||||||
Minimum
pension liability
|
-
|
-
|
-
|
88
|
-
|
88
|
||||||||||||||||||
Translation
adjustment
|
-
|
-
|
-
|
5,688
|
-
|
5,688
|
||||||||||||||||||
Fair
value of derivatives
|
-
|
-
|
-
|
(31 | ) |
-
|
(31 | ) | ||||||||||||||||
Total
comprehensive income
|
72,189
|
|||||||||||||||||||||||
Stock-based
compensation
|
-
|
3,865
|
-
|
-
|
-
|
3,865
|
||||||||||||||||||
Treasury
stock transactions:
|
||||||||||||||||||||||||
Purchase
of 513,750 shares
|
-
|
-
|
-
|
-
|
(17,491 | ) | (17,491 | ) | ||||||||||||||||
Issuance
of 121,353 shares under stock plans
|
-
|
564
|
-
|
-
|
2,101
|
2,665
|
||||||||||||||||||
Dividends,
$.205 per share
|
-
|
-
|
(6,552 | ) |
-
|
-
|
(6,552 | ) | ||||||||||||||||
Balance,
September 30, 2006
|
36,334
|
33,953
|
410,203
|
4,386
|
(92,451 | ) |
392,425
|
|||||||||||||||||
Net
income
|
-
|
-
|
64,726
|
-
|
-
|
64,726
|
||||||||||||||||||
Minimum
pension liability
|
-
|
-
|
-
|
2,191
|
-
|
2,191
|
||||||||||||||||||
Translation
adjustment
|
-
|
-
|
-
|
16,546
|
-
|
16,546
|
||||||||||||||||||
Fair
value of derivatives
|
-
|
-
|
-
|
(740 | ) |
-
|
(740 | ) | ||||||||||||||||
Total
comprehensive income
|
82,723
|
|||||||||||||||||||||||
Initial
adoption of SFAS No. 158
|
(8,993 | ) | (8,993 | ) | ||||||||||||||||||||
Stock-based
compensation
|
-
|
3,509
|
-
|
-
|
-
|
3,509
|
||||||||||||||||||
Treasury
stock transactions:
|
||||||||||||||||||||||||
Purchase
of 1,366,297 shares
|
-
|
-
|
-
|
-
|
(56,526 | ) | (56,526 | ) | ||||||||||||||||
Issuance
of 789,164 shares under stock plans
|
-
|
4,108
|
-
|
-
|
16,615
|
20,723
|
||||||||||||||||||
Dividends,
$.225 per share
|
-
|
-
|
(7,083 | ) |
-
|
-
|
(7,083 | ) | ||||||||||||||||
Balance,
September 30, 2007
|
$ |
36,334
|
$ |
41,570
|
$ |
467,846
|
$ |
13,390
|
$ | (132,362 | ) | $ |
426,778
|
2007
|
2006
|
2005
|
||||||||||
Cash
flows from operating activities:
|
||||||||||||
Net
income
|
$ |
64,726
|
$ |
66,444
|
$ |
58,071
|
||||||
Adjustments
to reconcile net income to net cash
provided
by operating activities:
|
||||||||||||
Depreciation and amortization
|
20,528
|
21,463
|
19,893
|
|||||||||
Minority
interest
|
2,733
|
2,971
|
5,775
|
|||||||||
Stock-based
compensation expense
|
3,509
|
3,865
|
2,874
|
|||||||||
Increase
(decrease) in deferred taxes
|
7,826
|
(1,885 | ) |
1,304
|
||||||||
Impairment
charges
|
-
|
986
|
-
|
|||||||||
Gain
on dispositions of assets
|
(3,106 | ) | (3,090 | ) | (200 | ) | ||||||
Changes
in working capital items
|
(14,373 | ) | (28,093 | ) | (19,673 | ) | ||||||
Increase
in other assets
|
(5,113 | ) | (118 | ) | (1,622 | ) | ||||||
Decrease
in other liabilities
|
(1,225 | ) | (1,205 | ) | (2,240 | ) | ||||||
(Decrease)
increase in pension and postretirement benefits
|
(907 | ) |
5,007
|
6,719
|
||||||||
Net
cash provided by operating activities
|
74,598
|
66,345
|
70,901
|
|||||||||
Cash
flows from investing activities:
|
||||||||||||
Capital
expenditures
|
(20,649 | ) | (19,397 | ) | (28,066 | ) | ||||||
Acquisitions,
net of cash acquired
|
(23,784 | ) | (32,278 | ) | (109,352 | ) | ||||||
Proceeds
from
dispositions of assets
|
6,859
|
3,114
|
1,099
|
|||||||||
Purchases
of
investment securities
|
(4,033 | ) | (232 | ) | (11,758 | ) | ||||||
Proceeds
from
dispositions of investments
|
2,919
|
15
|
9,119
|
|||||||||
Net
cash used in investing activities
|
(38,688 | ) | (48,778 | ) | (138,958 | ) | ||||||
Cash
flows from financing activities:
|
||||||||||||
Proceeds
from
long-term debt
|
75,770
|
45,422
|
103,587
|
|||||||||
Payments
on
long-term debt
|
(58,024 | ) | (47,539 | ) | (27,851 | ) | ||||||
Purchases
of
treasury stock
|
(56,526 | ) | (17,491 | ) | (27,933 | ) | ||||||
Proceeds
from
the sale of treasury stock
|
16,524
|
2,028
|
5,894
|
|||||||||
Tax benefit on exercised stock options
|
3,834
|
637
|
2,525
|
|||||||||
Dividends
|
(7,083 | ) | (6,552 | ) | (5,925 | ) | ||||||
Distributions
to minority interests
|
(1,601 | ) | (5,536 | ) | (5,507 | ) | ||||||
Net
cash (used in) provided by financing activities
|
(27,106 | ) | (29,031 | ) |
44,790
|
|||||||
Effect
of exchange rate changes on cash
|
5,478
|
1,629
|
(3,008 | ) | ||||||||
Net
change in cash and cash equivalents
|
14,282
|
(9,835 | ) | (26,275 | ) | |||||||
Cash
and cash equivalents at beginning of year
|
29,720
|
39,555
|
65,830
|
|||||||||
Cash
and cash equivalents at end of year
|
$ |
44,002
|
$ |
29,720
|
$ |
39,555
|
||||||
Cash
paid during the year for:
|
||||||||||||
Interest
|
$ |
8,105
|
$ |
6,377
|
$ |
2,692
|
||||||
Income
taxes
|
31,470
|
42,377
|
32,125
|
1.
|
NATURE
OF OPERATIONS:
|
2.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING
POLICIES:
|
2.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES,
continued:
|
2.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES,
continued:
|
2.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES,
continued:
|
3.
|
INVENTORIES:
|
2007
|
2006
|
|||||||
Materials
and finished goods
|
$ |
86,304
|
$ |
79,715
|
||||
Labor
and overhead in process
|
7,530
|
5,700
|
||||||
$ |
93,834
|
$ |
85,415
|
4.
|
INVESTMENTS:
|
2007
|
2006
|
|||||||
Available-for-sale:
|
||||||||
U.S.
government and its agencies
|
$ |
1,501
|
$ |
2,247
|
||||
Corporate
obligations
|
3,814
|
2,747
|
||||||
Trading
securities:
|
||||||||
Mutual
funds
|
4,923
|
4,598
|
||||||
Equity
and other investments
|
1,806
|
1,900
|
||||||
$ |
12,044
|
$ |
11,492
|
5.
|
PROPERTY,
PLANT AND EQUIPMENT:
|
2007
|
2006
|
|||||||
Buildings
|
$ |
42,493
|
$ |
43,907
|
||||
Machinery
and equipment
|
166,183
|
148,387
|
||||||
208,676
|
192,294
|
|||||||
Less
accumulated depreciation
|
(129,995 | ) | (114,247 | ) | ||||
78,681
|
78,047
|
|||||||
Land
|
4,159
|
4,814
|
||||||
Construction
in progress
|
6,086
|
5,238
|
||||||
$ |
88,926
|
$ |
88,099
|
6.
|
LONG-TERM
DEBT:
|
2007
|
2006
|
|||||||
Revolving
credit facilities
|
$ |
159,240
|
$ |
133,946
|
||||
Notes
payable to banks
|
7,332
|
10,214
|
||||||
Short-term
borrowings
|
2,068
|
2,961
|
||||||
Capital
lease obligations
|
690
|
1,619
|
||||||
169,330
|
148,740
|
|||||||
Less
current maturities
|
(27,057 | ) | (28,451 | ) | ||||
$ |
142,273
|
$ |
120,289
|
6.
|
LONG-TERM
DEBT, continued:
|
Date
|
Initial
Amount
|
Fixed
Interest Rate
|
Interest
Rate Spread at September 30, 2007
|
Equal
Quarterly Payments
|
Maturity
Date
|
||||||||||||
April
2004
|
$ |
50,000
|
2.66 | % | .40 | % | $ |
2,500
|
April
2009
|
||||||||
September
2005
|
50,000
|
4.14
|
.40
|
3,333
|
April
2009
|
||||||||||||
August
2007
|
15,000
|
5.07
|
.40
|
-
|
April
2009
|
||||||||||||
August
2007
|
10,000
|
5.07
|
.40
|
-
|
April
2009
|
||||||||||||
September
2007
|
25,000
|
4.77
|
.40
|
-
|
September
2012
|
6.
|
LONG-TERM
DEBT, continued:
|
2008
|
$ |
27,057
|
||
2009
|
30,395
|
|||
2010
|
1,472
|
|||
2011
|
1,466
|
|||
2012
|
107,880
|
|||
Thereafter
|
1,060
|
|||
$ |
169,330
|
7.
|
SHAREHOLDERS'
EQUITY:
|
2007
|
2006
|
|||||||
Cumulative
foreign currency translation
|
$ |
30,526
|
$ |
13,980
|
||||
Fair
value of derivatives, net of tax of $114 and $586,
respectively
|
178
|
918
|
||||||
Minimum
pension liability, net of tax of $5,091 and
$6,721,
respectively
|
(8,321 | ) | (10,512 | ) | ||||
Impact
of adoption of SFAS No. 158, net of tax of $5,748
|
(8,993 | ) |
-
|
|||||
$ |
13,390
|
$ |
4,386
|
8.
|
SHARE-BASED
PAYMENTS:
|
8.
|
SHARE-BASED
PAYMENTS, continued:
|
Weighted-
|
||||||||||||||||
Weighted-
|
average
|
Aggregate
|
||||||||||||||
average
|
remaining
|
intrinsic
|
||||||||||||||
Shares
|
exercise
price
|
contractual
term
|
value
|
|||||||||||||
Outstanding,
September 30, 2006
|
2,529,451
|
$ |
28.75
|
|||||||||||||
Granted
|
392,650
|
40.59
|
||||||||||||||
Exercised
|
(768,111 | ) |
21.36
|
|||||||||||||
Expired
or forfeited
|
(53,413 | ) |
31.45
|
|||||||||||||
Outstanding,
September 30, 2007
|
2,100,577
|
33.60
|
7.2
|
$21,428
|
||||||||||||
Exercisable,
September 30, 2007
|
458,376
|
27.02
|
5.6
|
$7,690
|
||||||||||||
Shares
reserved for future options
|
2,557,997
|
8.
|
SHARE-BASED
PAYMENTS, continued:
|
Weighted-average
|
||||||||
grant-date
|
||||||||
Shares
|
fair
value
|
|||||||
Non-vested
at September 30, 2006
|
1,814,878
|
$ |
9.84
|
|||||
Granted
|
392,650
|
12.29
|
||||||
Vested
|
(513,830 | ) |
8.43
|
|||||
Expired
or forfeited
|
(51,497 | ) |
9.83
|
|||||
Non-vested
at September 30, 2007
|
1,642,201
|
10.87
|
Years
Ended
September
30,
|
||||||||||||
2007
|
2006
|
2005
|
||||||||||
Expected
volatility
|
24.0 | % | 24.0 | % | 23.2 | % | ||||||
Dividend
yield
|
.6 | % | .6 | % | 1.0 | % | ||||||
Average
risk free interest rate
|
4.7 | % | 4.4 | % | 4.3 | % | ||||||
Average
expected term (years)
|
6.3
|
5.5
|
7.9
|
8.
|
SHARE-BASED
PAYMENTS, continued:
|
2007
|
2006
|
2005
|
||||||||||
Net
income
|
$ |
64,726
|
$ |
66,444
|
$ |
58,071
|
||||||
Weighted-average
common shares outstanding
|
31,565,716
|
31,999,309
|
32,116,012
|
|||||||||
Dilutive
securities, primarily stock options
|
113,900
|
252,415
|
265,562
|
|||||||||
Diluted
weighted-average common shares outstanding
|
31,679,616
|
32,251,724
|
32,381,574
|
|||||||||
Basic
earnings per share
|
$2.05
|
$2.08
|
$1.81
|
|||||||||
Diluted
earnings per share
|
$2.04
|
$2.06
|
$1.79
|
|||||||||
10.
|
PENSION
AND OTHER POSTRETIREMENT
PLANS:
|
Pension
|
Other
Postretirement
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Change
in benefit obligation:
|
||||||||||||||||
Benefit
obligation, beginning
|
$ |
104,060
|
$ |
106,352
|
$ |
18,267
|
$ |
22,068
|
||||||||
Service
cost
|
3,892
|
4,504
|
533
|
632
|
||||||||||||
Interest
cost
|
6,525
|
5,923
|
1,188
|
1,227
|
||||||||||||
Assumption
changes
|
-
|
(9,887 | ) |
-
|
(1,693 | ) | ||||||||||
Actuarial
(gain) loss
|
1,774
|
2,016
|
2,944
|
(2,494 | ) | |||||||||||
Benefit
payments
|
(4,708 | ) | (4,848 | ) | (1,113 | ) | (1,473 | ) | ||||||||
Benefit
obligation, ending
|
111,543
|
104,060
|
21,819
|
18,267
|
||||||||||||
Change
in plan assets:
|
||||||||||||||||
Fair
value, beginning
|
75,817
|
79,915
|
-
|
-
|
||||||||||||
Actual
return
|
9,849
|
(43 | ) |
-
|
-
|
|||||||||||
Benefit
payments
|
(4,708 | ) | (4,848 | ) | (1,113 | ) | (1,473 | ) | ||||||||
Employer
contributions
|
6,082
|
793
|
1,113
|
1,473
|
||||||||||||
Fair
value, ending
|
87,040
|
75,817
|
-
|
-
|
||||||||||||
Funded
status
|
(24,503 | ) | (28,243 | ) | (21,819 | ) | (18,267 | ) | ||||||||
Unrecognized
actuarial loss
|
24,296
|
27,487
|
7,991
|
5,335
|
||||||||||||
Unrecognized
prior service cost
|
311
|
342
|
(4,214 | ) | (5,502 | ) | ||||||||||
Net
amount recognized
|
$ |
104
|
$ | (414 | ) | $ | (18,042 | ) | $ | (18,434 | ) | |||||
Amounts
recognized in the consolidated balance sheet:
|
||||||||||||||||
Current
liability
|
$ | (874 | ) | $ | (517 | ) | $ | (1,076 | ) | $ | (1,012 | ) | ||||
Noncurrent
benefit liability
|
(23,629 | ) | (17,720 | ) | (20,743 | ) | (17,422 | ) | ||||||||
Accumulated
other comprehensive income
|
24,607
|
17,823
|
3,777
|
-
|
||||||||||||
Net
amount recognized
|
$ |
104
|
$ | (414 | ) | $ | (18,042 | ) | $ | (18,434 | ) | |||||
Amounts
recognized in accumulated
|
||||||||||||||||
other comprehensive income:
|
||||||||||||||||
Net
actuarial gain/loss
|
$ |
24,296
|
$ |
7,991
|
||||||||||||
Prior
service cost
|
311
|
(4,214 | ) | |||||||||||||
Net
amount recognized
|
$ |
24,607
|
$ |
3,777
|
||||||||||||
10.
|
PENSION
AND OTHER POSTRETIREMENT PLANS,
continued:
|
Balance
prior to Additional Minimum Liability and SFAS No.158
Adjustments
|
Additional
Minimum Liability
Adjustments
|
Balance
prior to
SFAS
No.
158 Adjustments
|
SFAS
No.
158 Adjustments
|
Balance
after SFAS
No.
158 Adjustments
|
||||||||||||||||
Pension
Benefits:
|
||||||||||||||||||||
Intangible
assets
|
$ |
360
|
$ | (360 | ) | $ |
-
|
$ |
-
|
$ |
-
|
|||||||||
Current
liabilities
|
(874 | ) |
-
|
(874 | ) |
-
|
(874 | ) | ||||||||||||
Pension
liabilities
|
(16,845 | ) |
4,181
|
(12,664 | ) | (10,965 | ) | (23,629 | ) | |||||||||||
Deferred
tax assets
|
6,951
|
(1,630 | ) |
5,321
|
4,276
|
9,597
|
||||||||||||||
Accumulated
other comprehensive income (loss)
|
(17,823 | ) |
4,181
|
(13,642 | ) | (10,965 | ) | (24,607 | ) | |||||||||||
Postretirement
Benefits:
|
||||||||||||||||||||
Current
liabilities
|
(1,076 | ) |
-
|
(1,076 | ) |
-
|
(1,076 | ) | ||||||||||||
Postretirement
benefits
|
(16,966 | ) |
-
|
(16,966 | ) | (3,777 | ) | (20,743 | ) | |||||||||||
Deferred
tax assets
|
-
|
-
|
-
|
1,473
|
1,473
|
|||||||||||||||
Accumulated
other comprehensive income (loss)
|
-
|
-
|
-
|
(3,777 | ) | (3,777 | ) |
Pension
|
Other
Postretirement
|
|||||||||||||||||||||||
2007
|
2006
|
2005
|
2007
|
2006
|
2005
|
|||||||||||||||||||
Service
cost
|
$ |
3,892
|
$ |
4,504
|
$ |
3,707
|
$ |
533
|
$ |
632
|
$ |
505
|
||||||||||||
Interest
cost
|
6,525
|
5,923
|
5,615
|
1,188
|
1,227
|
1,173
|
||||||||||||||||||
Expected
return on plan assets
|
(6,410 | ) | (6,879 | ) | (6,333 | ) |
-
|
-
|
-
|
|||||||||||||||
Amortization:
|
||||||||||||||||||||||||
Prior
service cost
|
31
|
(14 | ) |
83
|
(1,287 | ) | (1,287 | ) | (1,287 | ) | ||||||||||||||
Net
actuarial loss
|
1,527
|
1,979
|
1,378
|
288
|
646
|
493
|
||||||||||||||||||
Net
benefit cost
|
$ |
5,565
|
$ |
5,513
|
$ |
4,450
|
$ |
722
|
$ |
1,218
|
$ |
884
|
10.
|
PENSION
AND OTHER POSTRETIREMENT PLANS,
continued:
|
Pension
Benefits
|
Other
Postretirement Benefits
|
|||||||
Net
actuarial gain/loss
|
$ |
1,268
|
$ |
487
|
||||
Prior
service cost
|
28
|
(1,287 | ) |
Pension
|
Other
Postretirement
|
|||||||||||||||||||||||
2007
|
2006
|
2005
|
2007
|
2006
|
2005
|
|||||||||||||||||||
Discount
rate
|
6.50 | % | 6.50 | % | 5.75 | % | 6.50 | % | 6.50 | % | 5.75 | % | ||||||||||||
Return
on plan assets
|
9.00
|
9.00
|
9.00
|
-
|
-
|
-
|
||||||||||||||||||
Compensation
increase
|
4.25
|
4.25
|
4.25
|
-
|
-
|
-
|
Other
|
||||||||
Pension
|
Postretirement
|
|||||||
Year
ended September 30:
|
Benefits
|
Benefits
|
||||||
2008
|
$ |
5,270
|
$ |
1,076
|
||||
2009
|
5,344
|
1,192
|
||||||
2010
|
5,597
|
1,301
|
||||||
2011
|
5,827
|
1,426
|
||||||
2012
|
6,082
|
1,488
|
||||||
2013-2017
|
35,147
|
9,149
|
||||||
$ |
63,267
|
$ |
15,632
|
10.
|
PENSION
AND OTHER POSTRETIREMENT PLANS,
continued:
|
11.
|
INCOME
TAXES:
|
2007
|
2006
|
2005
|
||||||||||
Current:
|
||||||||||||
Federal
|
$ |
20,941
|
$ |
28,782
|
$ |
26,346
|
||||||
State
|
2,762
|
5,245
|
2,953
|
|||||||||
Foreign
|
7,461
|
7,087
|
5,005
|
|||||||||
31,164
|
41,114
|
34,304
|
||||||||||
Deferred
|
7,826
|
(2,150 | ) |
681
|
||||||||
Total
|
$ |
38,990
|
$ |
38,964
|
$ |
34,985
|
||||||
2007
|
2006
|
|||||||
Deferred
tax assets:
|
||||||||
Postretirement
benefits
|
$ |
8,510
|
$ |
7,189
|
||||
Environmental
reserve
|
3,437
|
3,924
|
||||||
Pension
costs
|
8,762
|
6,088
|
||||||
Deferred
compensation
|
2,535
|
4,289
|
||||||
Stock
options
|
3,825
|
4,631
|
||||||
Other
|
14,284
|
13,148
|
||||||
41,353
|
39,269
|
|||||||
Deferred
tax liabilities:
|
||||||||
Depreciation
|
(3,510 | ) | (4,725 | ) | ||||
Goodwill
|
(24,550 | ) | (17,776 | ) | ||||
Other
|
(115 | ) | (587 | ) | ||||
(28,175 | ) | (23,088 | ) | |||||
Net
deferred tax asset
|
$ |
13,178
|
$ |
16,181
|
2007
|
2006
|
2005
|
||||||||||
Federal
statutory tax rate
|
35.0 | % | 35.0 | % | 35.0 | % | ||||||
Effect
of state income taxes, net of federal deduction
|
2.2
|
2.9
|
1.8
|
|||||||||
Foreign
taxes in excess of federal statutory rate
|
.5
|
.4
|
.5
|
|||||||||
Tax
on repatriated earnings
|
.0
|
.0
|
.7
|
|||||||||
Other
|
(0.1 | ) | (1.3 | ) | (.4 | ) | ||||||
Effective
tax rate
|
37.6 | % | 37.0 | % | 37.6 | % |
12.
|
COMMITMENTS
AND CONTINGENT
LIABILITIES:
|
13.
|
ENVIRONMENTAL
MATTERS:
|
14.
|
SUPPLEMENTAL
CASH FLOW INFORMATION:
|
2007
|
2006
|
2005
|
||||||||||
Current
assets:
|
||||||||||||
Accounts
receivable
|
$ |
1,502
|
$ | (4,110 | ) | $ | (13,489 | ) | ||||
Inventories
|
(2,135 | ) | (10,860 | ) | (9,886 | ) | ||||||
Other
current assets
|
(2,567 | ) |
518
|
549
|
||||||||
(3,200 | ) | (14,452 | ) | (22,826 | ) | |||||||
Current
liabilities:
|
||||||||||||
Trade
accounts payable
|
1,064
|
(9,765 | ) |
7,529
|
||||||||
Accrued
compensation
|
(2,411 | ) |
50
|
1,584
|
||||||||
Accrued
income taxes
|
(3,644 | ) | (2,410 | ) | (1,378 | ) | ||||||
Customer
prepayments
|
514
|
(674 | ) |
722
|
||||||||
Other
current liabilities
|
(6,696 | ) | (842 | ) | (5,304 | ) | ||||||
(11,173 | ) | (13,641 | ) |
3,153
|
||||||||
Net
change
|
$ | (14,373 | ) | $ | (28,093 | ) | $ | (19,673 | ) |
15.
|
SEGMENT
INFORMATION:
|
15.
|
SEGMENT
INFORMATION, continued:
|
Memorialization
|
Brand
Solutions
|
|||||||||||||||||||||||||||||||
Graphics
|
Marking
|
Merchandising
|
||||||||||||||||||||||||||||||
Bronze
|
Casket
|
Cremation
|
Imaging
|
Products
|
Solutions
|
Other
|
Consolidated
|
|||||||||||||||||||||||||
Sales
to external customers:
|
||||||||||||||||||||||||||||||||
2007
|
$ |
229,850
|
$ |
210,673
|
$ |
25,166
|
$ |
146,049
|
$ |
57,450
|
$ |
80,164
|
$ |
-
|
$ |
749,352
|
||||||||||||||||
2006
|
218,004
|
200,950
|
25,976
|
140,886
|
52,272
|
77,803
|
-
|
715,891
|
||||||||||||||||||||||||
2005
|
205,675
|
135,512
|
21,497
|
143,159
|
45,701
|
88,278
|
-
|
639,822
|
||||||||||||||||||||||||
Intersegment
sales:
|
||||||||||||||||||||||||||||||||
2007
|
208
|
220
|
2,594
|
13
|
41
|
41
|
-
|
3,117
|
||||||||||||||||||||||||
2006
|
151
|
301
|
1,048
|
1
|
36
|
105
|
-
|
1,642
|
||||||||||||||||||||||||
2005
|
175
|
437
|
423
|
-
|
37
|
224
|
-
|
1,296
|
||||||||||||||||||||||||
Depreciation
and amortization:
|
||||||||||||||||||||||||||||||||
2007
|
3,707
|
6,680
|
164
|
5,431
|
630
|
2,896
|
1,020
|
20,528
|
||||||||||||||||||||||||
2006
|
4,411
|
6,581
|
221
|
6,015
|
482
|
2,760
|
993
|
21,463
|
||||||||||||||||||||||||
2005
|
4,644
|
4,456
|
237
|
6,634
|
475
|
2,677
|
770
|
19,893
|
||||||||||||||||||||||||
Operating
profit:
|
||||||||||||||||||||||||||||||||
2007
|
66,298
|
11,801
|
3,631
|
14,439
|
9,931
|
5,724
|
-
|
111,824
|
||||||||||||||||||||||||
2006
|
65,049
|
16,971
|
3,372
|
16,554
|
9,066
|
2,872
|
-
|
113,884
|
||||||||||||||||||||||||
2005
|
59,722
|
12,645
|
701
|
14,861
|
7,373
|
3,111
|
-
|
98,413
|
||||||||||||||||||||||||
Total
assets:
|
||||||||||||||||||||||||||||||||
2007
|
158,666
|
280,598
|
11,910
|
180,987
|
42,851
|
59,436
|
36,621
|
771,069
|
||||||||||||||||||||||||
2006
|
149,593
|
258,224
|
11,452
|
157,677
|
31,477
|
65,860
|
41,807
|
716,090
|
||||||||||||||||||||||||
2005
|
148,408
|
222,270
|
11,128
|
150,687
|
29,924
|
58,173
|
44,865
|
665,455
|
||||||||||||||||||||||||
Capital
expenditures:
|
||||||||||||||||||||||||||||||||
2007
|
3,557
|
5,811
|
170
|
3,850
|
545
|
6,426
|
290
|
20,649
|
||||||||||||||||||||||||
2006
|
2,101
|
7,217
|
38
|
3,730
|
592
|
5,391
|
328
|
19,397
|
||||||||||||||||||||||||
2005
|
2,129
|
7,730
|
29
|
8,119
|
638
|
2,207
|
7,214
|
28,066
|
15.
|
SEGMENT
INFORMATION, continued:
|
United
States
|
Mexico
|
Canada
|
Europe
|
Australia
|
China
|
Consolidated
|
||||||||||||||||||||||
Sales
to external customers:
|
||||||||||||||||||||||||||||
2007
|
$ |
563,594
|
$ |
-
|
$ |
14,475
|
$ |
158,651
|
$ |
9,969
|
$ |
2,663
|
$ |
749,352
|
||||||||||||||
2006
|
550,254
|
-
|
13,520
|
143,706
|
8,411
|
-
|
715,891
|
|||||||||||||||||||||
2005
|
474,466
|
-
|
11,319
|
145,931
|
8,106
|
-
|
639,822
|
|||||||||||||||||||||
Long-lived
assets:
|
||||||||||||||||||||||||||||
2007
|
312,694
|
6,377
|
504
|
131,786
|
3,066
|
4,103
|
458,530
|
|||||||||||||||||||||
2006
|
300,502
|
6,785
|
2,544
|
118,797
|
2,561
|
-
|
431,189
|
|||||||||||||||||||||
2005
|
270,540
|
6,759
|
2,482
|
113,521
|
2,634
|
-
|
395,936
|
16.
|
ACQUISITIONS:
|
16.
|
ACQUISITIONS,
continued:
|
Cash
|
$ |
197
|
||
Trade
receivables
|
13,143
|
|||
Inventories
|
17,975
|
|||
Property,
plant and equipment
|
5,434
|
|||
Intangible
assets
|
16,200
|
|||
Goodwill
and other assets
|
63,152
|
|||
Total
assets acquired
|
116,101
|
|||
Trade
accounts payable
|
9,467
|
|||
Debt
|
1,207
|
|||
Other
liabilities
|
3,022
|
|||
Total
liabilities assumed
|
13,696
|
|||
Net
assets acquired
|
$ |
102,405
|
16.
|
ACQUISITIONS,
continued:
|
2005
|
|||||
Sales
|
$ |
707,222
|
|||
Income
before taxes
|
98,734
|
||||
Net
income
|
61,614
|
||||
Earnings
per share
|
$1.90
|
18.
|
GOODWILL
AND OTHER INTANGIBLE
ASSETS:
|
Graphics
|
Marking
|
Merchandising
|
||||||||||||||||||||||||||
Bronze
|
Casket
|
Cremation
|
Imaging
|
Products
|
Solutions
|
Consolidated
|
||||||||||||||||||||||
Balance
at September 30, 2005
|
$ |
73,029
|
$ |
91,977
|
$ |
6,536
|
$ |
73,970
|
$ |
5,213
|
$ |
9,947
|
$ |
260,672
|
||||||||||||||
Additions
during period
|
-
|
24,005
|
-
|
8,502
|
-
|
-
|
32,507
|
|||||||||||||||||||||
Translation
and adjustments
|
1,149
|
-
|
-
|
3,797
|
-
|
-
|
4,946
|
|||||||||||||||||||||
Balance
at September 30, 2006
|
74,178
|
115,982
|
6,536
|
86,269
|
5,213
|
9,947
|
298,125
|
|||||||||||||||||||||
Additions
|
-
|
4,573
|
-
|
885
|
3,550
|
-
|
9,008
|
|||||||||||||||||||||
Dispositions
|
-
|
-
|
-
|
-
|
-
|
(809 | ) | (809 | ) | |||||||||||||||||||
Translation
and adjustments
|
3,197
|
-
|
-
|
8,478
|
299
|
-
|
11,974
|
|||||||||||||||||||||
Balance
at September 30, 2007
|
$ |
77,375
|
$ |
120,555
|
$ |
6,536
|
$ |
95,632
|
$ |
9,062
|
$ |
9,138
|
$ |
318,298
|
Carrying
|
Accumulated
|
|||||||||||
Amount
|
Amortization
|
Net
|
||||||||||
September
30, 2007:
|
||||||||||||
Trade
names
|
$ |
26,140
|
$ | - | * | $ |
26,140
|
|||||
Customer
relationships
|
25,215
|
(3,977 | ) |
21,238
|
||||||||
Copyrights/patents/other
|
7,382
|
(3,454 | ) |
3,928
|
||||||||
$ |
58,737
|
$ | (7,431 | ) | $ |
51,306
|
||||||
September
30, 2006:
|
||||||||||||
Trade
names
|
$ |
24,003
|
$ | - | * | $ |
24,003
|
|||||
Customer
relationships
|
20,900
|
(2,714 | ) |
18,186
|
||||||||
Copyrights/patents/other
|
5,322
|
(2,546 | ) |
2,776
|
||||||||
$ |
50,225
|
$ | (5,260 | ) | $ |
44,965
|
||||||
*
Not subject to amortization
|
19.
|
ACCOUNTING
PRONOUNCEMENTS:
|
Quarter
Ended
|
||||||||||||||||||||
December
31
|
March
31
|
June
30
|
September
30
|
Year
Ended
September
30
|
||||||||||||||||
(Dollar
amounts in thousands, except per share data)
|
||||||||||||||||||||
FISCAL
YEAR 2007:
|
||||||||||||||||||||
Sales
|
$ |
175,424
|
$ |
202,979
|
$ |
185,477
|
$ |
185,472
|
$ |
749,352
|
||||||||||
Gross
profit
|
64,934
|
74,207
|
69,418
|
71,898
|
280,457
|
|||||||||||||||
Operating
profit
|
24,184
|
31,645
|
21,129
|
34,866
|
111,824
|
|||||||||||||||
Net
income
|
13,971
|
18,501
|
12,029
|
20,225
|
64,726
|
|||||||||||||||
Earnings
per share
|
.44
|
.58
|
.38
|
.64
|
2.04
|
|||||||||||||||
FISCAL
YEAR 2006:
|
||||||||||||||||||||
Sales
|
$ |
170,109
|
$ |
181,068
|
$ |
181,804
|
$ |
182,910
|
$ |
715,891
|
||||||||||
Gross
profit
|
61,197
|
66,947
|
70,289
|
73,500
|
271,933
|
|||||||||||||||
Operating
profit
|
22,418
|
29,061
|
30,523
|
31,882
|
113,884
|
|||||||||||||||
Net
income
|
12,907
|
16,852
|
17,706
|
18,979
|
66,444
|
|||||||||||||||
Earnings
per share
|
.40
|
.52
|
.55
|
.59
|
2.06
|
|||||||||||||||
Additions
|
||||||||||||||||||||
Balance
at
|
Charged
to
|
|||||||||||||||||||
beginning
of
|
Charged
to
|
other
|
Balance
at
|
|||||||||||||||||
Description
|
period
|
expense
|
accounts
|
Deductions
|
end
of period
|
|||||||||||||||
(1 | ) | (2 | ) | |||||||||||||||||
Allowance
for Doubtful Accounts:
|
||||||||||||||||||||
Fiscal
Year Ended:
|
||||||||||||||||||||
September
30, 2007
|
$ |
10,829
|
$ |
335
|
$ |
209
|
$ | (213 | ) | $ |
11,160
|
|||||||||
September
30, 2006
|
10,547
|
474
|
890
|
(1,082 | ) |
10,829
|
||||||||||||||
September
30, 2005
|
7,717
|
398
|
3,209
|
(777 | ) |
10,547
|
(1)
|
Amount
comprised principally of acquisitions and purchase accounting adjustments
in connection with acquisitions.
|
(2)
|
Amounts
determined not to be collectible, net of
recoveries.
|
ITEM
9.
|
CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE.
|
ITEM
10.
|
DIRECTORS,
OFFICERS and EXECUTIVE MANAGEMENT OF THE
REGISTRANT.
|
ITEM
12.
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
|
Equity
Compensation Plan Information
|
|||
Number
of securities
|
|||
remaining
available
|
|||
for
future issuance
|
|||
Number
of securities
|
Weighted-average
|
under
equity
|
|
to
be issued upon
|
exercise
price
|
compensation
plans
|
|
exercise
of
|
of
outstanding
|
(excluding
|
|
outstanding
options,
|
options,
warrants
|
securities
reflected
|
|
Plan
category
|
warrants
and rights
|
and
rights
|
in
column (a))
|
(a)
|
(b)
|
(c)
|
|
Equity
compensation plans
|
|||
Approved
by security holders:
|
|||
Stock
Incentive Plan
|
2,100,577
|
$33.60
|
2,557,997(1)
|
Employee
Stock Purchase Plan
|
-
|
-
|
1,732,435(2)
|
Director
Fee Plan
|
69,997
|
35.05
|
385,518(3)
|
Equity
compensation plans not approved by security holders
|
None
|
None
|
None
|
Total
|
2,170,574
|
$33.61
|
4,675,950
|
|
(1)
|
The
aggregate number of shares available for grant under such plan cannot
exceed 15% of the outstanding shares of the Company’s common stock
(4,658,574 shares at September 30, 2007) and includes up to 1,000,000
shares that can be issued as restricted stock under the Company’s 1992
Stock Incentive Plan.
|
|
(2)
|
Shares
under the Employee Stock Purchase Plan (the “Plan”) are purchased in the
open market by employees at the fair market value of the Company’s
stock. The Company provides a matching contribution of 10% of
such purchases subject to certain limitations under the
Plan. As the Plan is an open market purchase plan, it does not
have a dilutive effect.
|
|
(3)
|
Shares
of restricted stock may be issued under the Director Fee
Plan. On November 13, 2007, the maximum number of shares
authorized to be issued under the Director Fee Plan was reduced from
500,000 shares to 300,000 shares. As such, the number of
securities remaining available for future issuance under the Director
Fee
Plan was 185,518 at November 13,
2007.
|
ITEM
13.
|
CERTAIN
RELATIONSHIPS AND RELATED
TRANSACTIONS.
|
ITEM
14.
|
PRINCIPAL
ACCOUNTING FEES AND SERVICES.
|
ITEM
15.
|
EXHIBITS,
FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM
8-K.
|
Pages
|
|
Management’s
Report to Shareholders
|
34
|
Report
of Independent Registered Public Accounting Firm
|
35
|
Consolidated
Balance Sheets as of September 30, 2007 and 2006
|
36-37
|
Consolidated
Statements of Income for the years ended September 30, 2007, 2006
and
2005
|
38
|
Consolidated
Statements of Shareholders' Equity for the years ended September
30, 2007,
2006 and 2005
|
39
|
Consolidated
Statements of Cash Flows for the years ended September 30, 2007,
2006 and
2005
|
40
|
Notes
to Consolidated Financial Statements
|
41-62
|
Supplementary
Financial Information
|
63
|
2.
|
Financial
Statement Schedules:
|
3.
|
Exhibits
Filed:
|
(b)
|
Reports
on Form 8-K:
|
MATTHEWS
INTERNATIONAL CORPORATION
|
||
(Registrant)
|
||
By
|
/s/Joseph
C. Bartolacci
|
|
Joseph
C. Bartolacci
|
||
President
and Chief Executive Officer
|
||
/s/Joseph
C. Bartolacci
|
/s/Steven
F. Nicola
|
|
Joseph
C. Bartolacci
|
Steven
F. Nicola
|
|
President
and Chief Executive Officer
|
Chief
Financial Officer, Secretary
|
|
(Principal
Executive Officer)
|
and
Treasurer (Principal Financial
|
|
and
Accounting Officer)
|
||
/s/David
M. Kelly
|
/s/John
P. O'Leary, Jr.
|
|
David
M. Kelly, Chairman of the Board
|
John
P. O'Leary, Jr., Director
|
|
/s/David
J. DeCarlo
|
/s/Martin
Schlatter.
|
|
David
J. DeCarlo, Director
|
Martin
Schlatter, Director
|
|
/s/Glenn
R. Mahone
|
/s/William
J. Stallkamp
|
|
Glenn
R. Mahone, Director
|
William
J. Stallkamp, Director
|
|
/s/Robert
G. Neubert
|
/s/John
D. Turner
|
|
Robert
G. Neubert, Director
|
John
D. Turner, Director
|
Exhibit
No.
|
Description
|
Prior
Filing or Sequential Page Numbers Herein
|
||
3.1
|
Restated
Articles of Incorporation *
|
Exhibit
Number 3.1 to Form 10-K
for
the year ended September 30, 1994
|
||
3.2
|
Restated
By-laws *
|
Exhibit
Number 99.1 to Form 8-K
dated
October 18, 2007
|
||
4.1
a
|
Form
of Revised Option Agreement of Repurchase
(effective
October 1, 1993) *
|
Exhibit
Number 4.5 to Form 10-K
for
the year ended September 30, 1993
|
||
4.2
|
Form
of Share Certificate for Class A Common Stock *
|
Exhibit
Number 4.9 to Form 10-K
for
the year ended September 30, 1994
|
||
10.1
|
Revolving
Credit Facility *
|
Exhibit
Number 10.1 to Form 10-K
for
the year ended September 30, 2001
|
||
10.2
|
First
Amendment to Revolving Credit Facility*
|
Exhibit
Number 10.1 to Form 10-Q
for
the quarter ended March 31, 2004
|
||
10.3
|
Second
Amendment to Revolving Credit Facility *
|
Exhibit
Number 10.1 to Form 10-Q
for
the quarter ended December 31, 2004
|
||
10.4
|
Third
Amendment to Revolving Credit Facility
|
Filed
Herewith
|
||
10.5
a
|
Supplemental
Retirement Plan*
|
Exhibit
Number 10.4 to Form 10-K
for
the year ended September 30, 2006
|
||
10.6
a
|
1992
Stock Incentive Plan (as amended through
April
25, 2006) *
|
Exhibit
Number 10.1 to Form 10-Q
for
the quarter ended March 31, 2006
|
||
INDEX,
Continued
|
_______
|
Exhibit
No.
|
Description
|
Prior
Filing or Sequential Page Numbers Herein
|
||
10.7
a
|
Form
of Stock Option Agreement *
|
Exhibit
Number 10.1 to Form 10-Q
for
the quarter ended December 31, 1994
|
||
10.8
a
|
Form
of Restricted Stock Agreement
|
Filed
Herewith
|
||
10.9
a
|
1994
Director Fee Plan (as amended through
November
13, 2007)
|
Filed
Herewith
|
||
10.10
a
|
1994
Employee Stock Purchase Plan *
|
Exhibit
Number 10.2 to Form 10-Q
for
the quarter ended March 31, 1995
|
||
10.11
a
|
Key
Employee Employment Agreement by and between The York Group, Inc.
and
Harry Pontone dated May 28, 2005 and effective July 11,
2005*
|
Exhibit
Number 10.2 to Form 8-K
dated
July 14, 2005
|
||
10.12
|
Agreement
and Plan of Merger By and Among Matthews International Corporation,
Empire
Merger Corp., and The York Group, Inc., dated as of May 24, 2001
*
|
Exhibit
Number 10.3 to Form 8-K
dated
May 24, 2001
|
||
10.13
|
Asset
Purchase Agreement between I.D.L. Incorporated and Hugh Andrew, L.P.
and
Big Red Rooster, Inc. and The Cloverleaf Group, L.P. and iDL shareholders
and the BRR shareholders and The Cloverleaf Group, Inc. and Matthews
International Corporation dated as of July 19, 2004*
|
Exhibit
Number 10.1 to Form 10-Q
for
the quarter ended June 30, 2004
|
||
10.14
|
Share
Sale and Purchase Agreement between Graeme Phillip King and Brian
Ernest
Tottman and Robert Greig Watkins and Geoffrey William Roberts and
Helen M.
King and Josephine Tottman and Sally R. Watkins and Jennifer R. Roberts
and Matthews Holding Company (U.K.) Limited.*
|
Exhibit
Number 10.11 to Form 10-K
for
the year ended September 30, 2004
|
||
10.15
|
Asset
Purchase Agreement by and among The York Group, Inc., Midnight Acquisition
Corporation, Milso Industries, Inc., Milso Industries, LLC, SBC Holding
Corporation, the Shareholders identified therein and Matthews
International Corporation*
|
Exhibit
Number 10.1 to Form 8-K
dated
on July 14, 2005
|
||
14.1
|
Form
of Code of Ethics Applicable to Executive Management *
|
Exhibit
Number 14.1 to Form 10-K
for
the year ended September 30, 2004
|
||
INDEX,
Continued
|
||||
_______
|
||||
Exhibit
No.
|
Description
|
Prior
Filing or Sequential Page Numbers
Herein
|
21
|
Subsidiaries
of the Registrant
|
Filed
Herewith
|
||
23
|
Consent
of Independent Registered Public Accounting Firm
|
Filed
Herewith
|
||
31.1
|
Certification
of Principal Executive Officer for Joseph C. Bartolacci
|
Filed
Herewith
|
||
31.2
|
Certification
of Principal Financial Officer for Steven F. Nicola
|
Filed
Herewith
|
||
32.1
|
Certification
Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section
906 of
the Sarbanes-Oxley Act of 2002, of Joseph C. Bartolacci
|
Filed
Herewith
|
||
32.2
|
Certification
Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section
906 of
the Sarbanes-Oxley Act of 2002, of Steven F. Nicola
|
Filed
Herewith
|