TOOTSIE ROLL INDUSTRIES, INC. UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2015 OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to COMMISSION FILE NUMBER 1-1361
Tootsie Roll Industries, Inc.
(Exact Name of Registrant as Specified in its Charter)
VIRGINIA 22-1318955
(State of Incorporation) (I.R.S. Employer Identification No.)
7401 South Cicero Avenue, Chicago, Illinois 60629
(Address of Principal Executive Offices) (Zip Code)
773-838-3400
(Registrant's Telephone Number, Including Area Code)
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files) Yes No
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of 'accelerated filer,' 'large accelerated filer' and 'smaller reporting company' in Rule 12b-2 of the Exchange Act.
Large accelerated filer Accelerated filer
Non-accelerated filer Smaller reporting company
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) Yes No
Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date (September 30, 2015).
Class Outstanding
Common Stock, $.69 4/9 par value 37,687,773
Class B Common Stock, $.69 4/9 par value 23,554,967
TOOTSIE ROLL INDUSTRIES, INC.
September 30, 2015 INDEX
Page No.
Part I - Financial Information
Item 1. Financial Statements:
Condensed Consolidated Statements of Financial Position 3-4
Condensed Consolidated Statements of Earnings and Retained Earnings 5
Condensed Consolidated Statements of Comprehensive Earnings 6
Condensed Consolidated Statements of Cash Flows 7
Notes to Condensed Consolidated Financial Statements 8-15
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 16-21
Item 3. Quantitative and Qualitative Disclosures About Market Risk 21
Item 4. Controls and Procedures 21
Part II - Other Information
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 22
Item 6. Exhibits 22
Signatures 23
Certifications 25-27
This Quarterly Report on Form 10-Q contains 'forward-looking statements' within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. See 'Forward-Looking Statements' under Part I - Item 2 'Management's Discussion and Analysis of Financial Condition and Results of Operations' of this Quarterly Report on Form 10-Q.
PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS
TOOTSIE ROLL INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(in thousands) (Unaudited)
CURRENT ASSETS:
September 30, | December 31, | September 27, |
2015 | 2014 | 2014 |
ASSETS
Cash & cash equivalents | $ 70,726 | $ 100,108 | $ 45,142 |
Restricted cash | 1,273 | - | - |
Investments | 53,422 | 39,450 | 36,062 |
Trade accounts receivable, less allowances of $3,349, $1,968 & $3,391 | 98,088 | 43,253 | 102,325 |
Other receivables | 4,549 | 3,577 | 2,732 |
Inventories: | |||
Finished goods & work-in-process | 45,929 | 44,549 | 47,854 |
Raw material & supplies | 31,644 | 25,830 | 31,187 |
Prepaid expenses | 5,401 | 6,060 | 5,307 |
Deferred income taxes | 6,776 | 1,794 | 3,161 |
Total current assets | 317,808 | 264,621 | 273,770 |
PROPERTY, PLANT & EQUIPMENT, at cost:
Land | 22,214 | 22,360 | 22,453 |
Buildings | 113,091 | 113,279 | 111,351 |
Machinery & equipment | 348,988 | 350,929 | 340,381 |
Construction in progress | 14,162 | 1,641 | 10,750 |
498,455 | 488,209 | 484,935 | |
Less-accumulated depreciation | 310,887 | 298,128 | 293,642 |
Net property, plant and equipment | 187,568 | 190,081 | 191,293 |
OTHER ASSETS: Goodwill | 73,237 | 73,237 | 73,237 |
Trademarks | 175,024 | 175,024 | 175,024 |
Investments | 152,491 | 163,579 | 160,175 |
Split dollar officer life insurance | 26,042 | 33,632 | 40,296 |
Prepaid expenses | 3,722 | 6,927 | 7,201 |
Restricted cash | - | 1,589 | 1,664 |
Deferred income taxes | 1,505 | 1,696 | 3,858 |
Total other assets | 432,021 | 455,684 | 461,455 |
Total assets | $ 937,397 | $ 910,386 | $ 926,518 |
(The accompanying notes are an integral part of these statements.)
(in thousands except per share data) (Unaudited)
September 30,
2015
December 31,
2014
September 27,
2014
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 16,592 $ 11,641 $ 15,572
Bank loans 253 124 285
Dividends payable 5,512 4,814 4,835
Accrued liabilities 53,119 46,482 52,590 Postretirement health care and life insurance benefits 328 328 111
Income taxes payable 10,737 1,070 5,090
Liability for uncertain tax positions 1,001 - - Deferred compensation13,514 - -
TOOTSIE ROLL INDUSTRIES, INC. SHAREHOLDERS' |
EQUITY: |
Deferred income taxes | 51,608 | 47,356 | 53,569 |
Bank loans | 430 | 694 | 796 |
Postretirement health care and life insurance benefits | 12,475 | 11,983 | 9,519 |
Industrial development bonds | 7,500 | 7,500 | 7,500 |
Liability for uncertain tax positions | 6,109 | 8,584 | 9,474 |
Deferred compensation and other liabilities | 64,701 | 78,674 | 75,751 |
Total noncurrent liabilities | 142,823 | 154,791 | 156,609 |
Total current liabilities101,056 64,459 78,483NONCURRENT LIABILITIES:
Common stock, $.69-4/9 par value- 120,000 shares authorized; 37,688, 37,285 & 37,561, respectively, issued | 26,172 | 25,892 | 26,084 |
Class B common stock, $.69-4/9 par value- 40,000 shares authorized; 23,555, 22,887 & 22,897, respectively, issued | 16,358 | 15,894 | 15,901 |
Capital in excess of par value | 632,667 | 599,186 | 607,216 |
Retained earnings | 38,123 | 64,927 | 51,709 |
Accumulated other comprehensive loss | (18,217) | (13,098) | (7,905) |
Treasury stock (at cost)- 80, 78 & 78 shares, respectively | (1,992) | (1,992) | (1,992) |
Total Tootsie Roll Industries, Inc. shareholders' equity | 693,111 | 690,809 | 691,013 |
Noncontrolling interests | 407 | 327 | 413 |
Total equity | 693,518 | 691,136 | 691,426 |
Total liabilities and shareholders' equity | $ 937,397 | $ 910,386 | $ 926,518 |
(The accompanying notes are an integral part of these statements.)
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