This Form 8-K/A amends the Current Report on Form 8-K filed by Alexander &
Baldwin, Inc. with the Securities and Exchange Commission on July 13, 1995
("Form 8-K"), and sets forth the complete text of Item 7 thereof as amended and
restated. The date of report (date of earliest event reported) of the Form 8-K
to which this amendment relates is June 30, 1995.
Item 7. Financial Statements and Exhibits.
7(b). Pro forma financial information.
Filed as part of this report as Exhibit 10.a.(xxv) is the required pro
forma financial information relative to the disposition of assets described in
Item 2 of the Form 8-K. Also filed as part of this report as Exhibit 10.a.(xxvi)
is the required restated historical financial statements of the Company.
7(c). Exhibits.
Exhibit 10.a.(xxiv) Asset Purchase Agreement among XTRA, Inc., Matson
Navigation Company, Inc. and Matson Leasing Company,
Inc., dated June 30, 1995.
Exhibit 10.a.(xxv)* Revised pro forma financial information relative to the
disposition of assets described in Item 2 of the
Form 8-K.
Exhibit 10.a.(xxvi)* Balance Sheets as of December 31, 1993 and 1994 and
Statements of Income and Statements of Cash Flows for the
years ended December 31, 1992, 1993 and 1994, as restated
to reflect the disposition of assets described in Item 2
of the Form 8-K.
* Filed herewith
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
Date: December 12, 1995 ALEXANDER & BALDWIN, INC.
/s/ Glenn R. Rogers
Glenn R. Rogers
Vice President, Chief
Financial Officer and
Treasurer
EXHIBIT INDEX
Exhibit 10.a.(xxiv) Asset Purchase Agreement among XTRA, Inc., Matson
Navigation Company, Inc. and Matson Leasing Company,
Inc., dated June 30, 1995.
Exhibit 10.a.(xxv)* Revised pro forma financial information relative to the
disposition of assets described in Item 2 of the
Form 8-K.
Exhibit 10.a.(xxvi)* Balance Sheets as of December 31, 1993 and 1994 and
Statements of Income and Statements of Cash Flows for the
years ended December 31, 1992, 1993 and 1994, as restated
to reflect the disposition of assets described in Item 2
of the Form 8-K.
* Filed herewith
Exhibit 10.a.(xxv)
ALEXANDER & BALDWIN, INC. / SALE OF MATSON LEASING COMPANY, INC.
PRO FORMA CONDENSED STATEMENT OF INCOME (UNAUDITED)
YEAR ENDED DECEMBER 31, 1994
(In thousands, except per share amounts)
Historical Pro Forma
Basis Adjustments Pro Forma
A&B MLC (1) Amount Ref Basis
(i) (ii) (iii) (i)-(ii)+(iii)
------------ ---------- ----------- --- -------------
Revenue:
Net sales, revenue from sales and rentals $ 1,185,210 $ 62,895 $ 1,122,315
Interest, dividends and other 22,955 1,072 21,883
------------ ---------- ----------- --- -------------
Total revenue 1,208,165 63,967 1,144,198
------------ ---------- ----------- --- -------------
Costs and Expenses:
Cost of goods sold, services and rentals 939,766 5,356 934,410
Selling, general and administrative 127,462 29,353 98,109
Interest 27,702 12,654 15,048
Income Taxes 38,627 5,975 32,652
------------ ---------- ----------- --- -------------
Total costs and expenses 1,133,557 53,338 1,080,219
------------ ---------- ----------- --- -------------
Net Income from Continuing Operations $ 74,608 $ 10,629 $ 63,979
============ =========== =========== =============
Earnings per Share - Continuing Operations $ 1.62 $ 1.39
============ =============
Average Number of Shares Outstanding 46,059 46,059
============ =============
(1) Historical MLC amounts, adjusted for previously-eliminated intercompany transactions, have been
deducted in the preparation of these pro forma financial statements.
ALEXANDER & BALDWIN, INC. / SALE OF MATSON LEASING COMPANY, INC.
PRO FORMA CONDENSED STATEMENT OF INCOME (UNAUDITED)
THREE MONTHS ENDED MARCH 31, 1995
(In thousands, except per share amounts)
Historical Pro Forma
Basis Adjustments Pro Forma
A&B MLC (1) Amount Ref. Basis
(i) (ii) (iii) (i)-(ii)+(iii)
------------ ---------- ----------- --- -------------
Revenue:
Net sales, revenue from sales and rentals $ 256,595 $ 16,868 $ 239,727
Interest, dividends and other 6,377 124 6,253
------------ ---------- ----------- --- -------------
Total revenue 262,972 16,992 245,980
------------ ---------- ----------- --- -------------
Costs and Expenses:
Cost of goods sold, services and rentals 210,610 1,012 209,598
Selling, general and administrative 31,501 8,021 23,480
Interest 7,452 3,775 3,677
Income Taxes 4,849 1,578 3,271
------------ ---------- ----------- --- -------------
Total costs and expenses 254,412 14,386 240,026
------------ ---------- ----------- --- -------------
Net Income from Continuing Operations $ 8,560 $ 2,606 $ 5,954
============ =========== =========== =============
Earnings per Share - Continuing Operations $ 0.19 $ 0.13
============ =============
Average Number of Shares Outstanding 45,643 45,643
============ =============
(1) Historical MLC amounts, adjusted for previously-eliminated intercompany transactions, have been
deducted in the preparation of these pro forma financial statements.
ALEXANDER & BALDWIN, INC. / SALE OF MATSON LEASING COMPANY, INC.
PRO FORMA CONDENSED BALANCE SHEET (UNAUDITED)
MARCH 31, 1995 (In thousands)
Historical Pro Forma
Basis Adjustments Pro Forma
A&B MLC (1) Amount Ref. Basis
(i) (ii) (iii) (i)-(ii)+(iii)
------------ ---------- ----------- --- -------------
ASSETS
Current Assets:
Cash and cash equivalents $ 21,827 $ 582 $ 21,245
Accounts and notes receivable, net 145,864 26,101 $ 11,930 C 131,693
Inventories 110,023 110,023
Property held for sale 3,451 3,451
Deferred income taxes 15,451 1,678 13,773
Prepaid expenses and other 13,315 469 12,846
Accrued withdrawals from CCF (725) (725)
------------ ---------- ----------- --- -------------
Total current assets 309,206 28,830 11,930 292,306
Investments 69,166 69,166
Real Estate Developments 69,360 69,360
Property, Plant & Equipment - Net 1,277,640 313,348 964,292
Capital Construction Fund 178,580 112,564 D 291,144
Other Assets 70,369 156 70,213
------------ ---------- ----------- --- -------------
Total $ 1,974,321 $ 342,334 $ 124,494 $ 1,756,481
============ =========== =========== =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current portion of long-term liabilities $ 37,155 $ 15,000 $ 22,155
Short-term commercial paper borrowing 78,884 78,884
Accounts payable 42,486 1,444 41,042
Other 65,981 1,978 64,003
------------ ---------- ----------- --- -------------
Total current liabilities 224,506 18,422 206,084
------------ ---------- ----------- --- -------------
Long-Term Liabilities:
Long-term debt 552,083 185,187 366,896
Capital lease obligations 32,439 32,439
Post-retirement benefit obligations 117,728 379 117,349
Other 62,030 5,940 56,090
------------ ---------- ----------- --- -------------
Total long-term liabilities 764,280 191,506 572,774
------------ ---------- ----------- --- -------------
Deferred Income Taxes 356,252 63,113 $ 55,201 D,E 348,340
------------ ---------- ----------- --- -------------
Shareholders' Equity:
Capital stock 37,307 1 1 B 37,307
Additional capital 39,503 34,300 34,300 B 39,503
Unrealized holding gains on securities 31,016 31,016
Retained earnings 535,274 34,992 34,992 A,B,D 535,274
Cost of treasury stock (13,817) (13,817)
------------ ---------- ----------- --- -------------
Total shareholders' equity 629,283 69,293 69,293 629,283
------------ ---------- ----------- --- -------------
Total $ 1,974,321 $ 342,334 $ 124,494 $ 1,756,481
============ ========== =========== =============
(1) Historical MLC amounts have been deducted in the preparation of these pro forma financial statements.
NOTES TO PRO FORMA FINANCIAL STATEMENTS
(Unaudited)
1. BASIS OF PRESENTATION
The accompanying pro forma condensed financial statements present the
financial position of Alexander & Baldwin, Inc. (A&B) following the sale of
substantially all of the operating assets and certain liabilities of Matson
Leasing Company, Inc. (MLC), a wholly-owned subsidiary of Matson Navigation
Company, Inc. (Matson), which is wholly-owned by A&B, as of March 31, 1995,
for the year ended December 31, 1994 and for the quarter ended March 31,
1995.
On June 30, 1995, A&B sold the marine containers and substantially all of
the remaining assets of MLC to XTRA Inc.(XTRA) and XTRA assumed certain of
the liabilities of MLC. A description of the transaction is included in
Item 2 of the Form 8-K. The assets sold to XTRA and the liabilities
assumed by XTRA were specifically identified in the Asset Purchase
Agreement which was included as Exhibit 10.a.(xxiv) to the Form 8-K. The
net sales price was approximately $360 million, subject to the completion
and acceptance of an audit. Specifically excluded from the sale were the
debt and United States tax obligations of MLC.
The pro forma condensed balance sheet assumed that the transaction
occurred on March 31, 1995. The pro forma condensed statements of income
assumed that the transaction occurred on January 1, 1994. The pro forma
condensed financial statements are not necessarily indicative of the
financial condition or the results of operations of A&B had this
transaction been consummated on such dates and may not necessarily be
indicative of future performance of A&B.
The pro forma financial statements assume the repayment of all of MLC's
debt, the settlement of United States tax obligations of MLC (including
any additional obligations incurred as a result of the transaction) and the
investment of the residual cash remaining from the transaction into
Matson's Capital Construction Fund (CCF). The interest earnings that might
have been earned from the additional investment in the CCF have not been
included in the pro forma statements. A&B estimates that these amounts,
had they been included in the pro forma statements, would have been
approximately $6.7 million for the year ended December 31, 1994 and $1.8
million for the quarter ended March 31, 1995, based upon the rates of
return on investments held by the CCF during those periods. Possible uses
of the proceeds other than the retirement of debt, payment of tax
obligations and increases in investments, such as using a portion of the
proceeds to purchase additional operating assets, were not included in the
pro forma financial statements.
The condensed pro forma income statements do not include the gain from the
sale of MLC's net assets. This gain was approximately $17.2 million, after
deducting taxes of approximately $9.1 million.
2. PRO FORMA ADJUSTMENTS
In preparing the condensed pro forma income statements for the year ended
December 31, 1994 and for the quarter ended March 31, 1995, the primary
assumption was that the historical income statements of MLC for those
periods included the full operations of the business as a stand-alone
entity. A&B accounts for each of its subsidiaries in this manner.
Intercompany transactions were not included in the historical MLC income
statements. These amounts were not material. No pro forma adjustments
were required for the pro forma income statements other than subtracting
the historical revenue and expenses of MLC from those of A&B.
In preparing the condensed pro forma balance sheet as of March 31, 1995,
the total historical assets and liabilities of MLC were deducted from the
historical consolidated financial statements of A&B. The underlying
assumption was that the residual assets and liabilities retained by Matson
following the transaction, subsequently would be liquidated, settled or
retired at their historical cost basis. The market or settlement values of
such assets and liabilities were estimated to be approximately equal to
their historical accounting costs.
The following reflects the pro forma balance sheet adjustments, referenced
A - E, which are necessary to reflect the transaction described above on a
pro forma basis.
A. The actual sales price has been adjusted for changes in the net assets
of MLC that occurred from the March 31, 1995 transaction date that was
assumed in the preparation of the condensed pro forma balance sheet
through the actual closing date of June 30, 1995.
Since the sales price was based, in large part, on the value of MLC's
net operating assets at June 30, 1995, and since MLC consistently
added container assets to its leasing fleet up to such date, the sales
price was adjusted downward from the final negotiated sales price so
as not to overstate the proceeds from the sale. The adjusted sales
price yielded a pre-tax gain of approximately $26.3 million ($17.2
after tax), subject to audit. This gain has not been reflected in the
pro forma income statements.
B. MLC's historical capital stock, additional paid-in capital and
retained earnings that were subtracted from A&B's historical basis
shareholders' equity (in column (ii) of the pro forma balance sheet),
were restored to the pro forma balance sheet to reflect properly A&B's
shareholders' equity. The A&B shareholders' equity did not change as
a result of the transaction.
C. The intercompany receivable balance which resulted from cumulative
arms-length transactions between MLC and Matson that had been
eliminated in preparing the historical basis MLC balance sheet was
restored since the amount was not included in the sale of assets to
XTRA.
D. Proceeds from the sale which were not used to repay MLC's indebtedness
were assumed to be deposited into Matson's CCF to the extent that
previously undeposited earnings were available for deposit. Such
amount was estimated to be $112.6 million at March 31, 1995.
As discussed previously, no interest was assumed to have been earned
on the residual sales proceeds that were deposited into the CCF.
Using interest rates earned by the Company on its CCF investments
during the periods presented, interest earnings likely would have been
approximately $6.7 million ($4.2 million after tax) for 1994 and $1.8
million ($1.15 million after tax) for the first quarter of 1995.
E. Income tax accounts have been adjusted to reflect the tax
ramifications of the pro forma adjustments. The currently-payable
income taxes associated with the transaction were assumed to have been
paid on the assumed transaction closing date.
Exhibit 10.a.(xxvi)
ALEXANDER & BALDWIN, INC.
CONSOLIDATED BALANCE SHEETS
Restated
(In thousands)
December 31, 1994 1993
- -----------------------------------------------------------------------------
ASSETS
Current Assets:
Cash and cash equivalents $ 8,987 $ 32,295
Accounts and notes receivable:
Trade 110,881 111,652
Other 18,275 15,469
Inventories:
Sugar 52,648 53,979
Materials and supplies 38,029 37,178
Real estate held for sale 4,014 10,504
Deferred income taxes 15,366 2,042
Prepaid expenses 14,127 11,373
Accrued withdrawals from (deposits to)
Capital Construction Fund (550) 783
--------- ---------
Total current assets 261,777 275,275
--------- ---------
Investments 64,913 17,449
--------- ---------
Real Estate Developments 66,371 54,919
--------- ---------
Property:
Land 52,202 65,403
Buildings 190,852 202,643
Vessels 651,435 631,896
Machinery and equipment 656,425 619,241
Water, power and sewer systems 86,254 84,530
Other property improvements 83,222 101,530
--------- ---------
Total property 1,720,390 1,705,243
Less: Accumulated depreciation 744,718 672,260
--------- ---------
Net property 975,672 1,032,983
--------- ---------
Capital Construction Fund 176,044 175,194
--------- ---------
Net Assets of Discontinued Operations 313,690 296,008
--------- ---------
Other Assets 67,713 52,914
--------- ---------
Total Assets $ 1,926,180 $ 1,904,742
========= =========
ALEXANDER & BALDWIN, INC.
CONSOLIDATED BALANCE SHEETS (continued)
Restated
(In thousands)
December 31, 1994 1993
- ------------------------------------------------------------------------------
C>
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current portion of long-term debt $ 27,239 $ 13,089
Current portion of capital lease obligations 7,938 9,732
Short-term commercial paper borrowings 58,000 64,000
Accounts payable 35,505 37,592
Payrolls and vacation pay 19,847 20,291
Uninsured claims 12,110 9,336
Post-retirement benefits obligations - current 6,582 6,676
Taxes other than income 5,390 4,802
Accrued interest payable 4,611 8,060
Promotional programs 4,563 8,322
Income taxes - 3,506
Accrued and other liabilities 21,946 24,985
--------- ---------
Total current liabilities 203,731 210,391
--------- ---------
Long-term liabilities:
Long-term debt 526,231 582,473
Capital lease obligations 35,274 44,495
Post-retirement benefits obligations 116,610 112,898
Pension obligations 21,933 26,138
Uninsured claims 12,337 15,180
Other 27,489 27,712
--------- ---------
Total long-term liabilities 739,874 808,896
--------- ---------
Deferred Income Taxes 349,961 298,449
--------- ---------
Commitments and Contingencies
Shareholders' Equity :
Capital stock -- common stock without par value
authorized, 150,000 shares ($.75 stated value per
share); outstanding, 45,691 shares in 1994 and
46,404 shares in 1993 37,493 38,028
Additional capital 38,862 38,510
Unrealized holding gains on securities 29,073 -
Retained earnings 541,910 525,192
Cost of treasury stock (14,724) (14,724)
--------- ---------
Total shareholders' equity 632,614 587,006
--------- ---------
Total $ 1,926,180 $ 1,904,742
========= =========
ALEXANDER & BALDWIN, INC.
Consolidated Statements of Income
Restated
(In thousands except per share amounts)
Year Ended December 31, 1994 1993 1992
- -----------------------------------------------------------------------------------------
Revenue:
Net sales, food products $ 427,524 $ 281,816 $ 95,818
Net sales, property development and other 59,412 43,764 27,526
Transportation and terminal services 473,450 445,442 484,532
Rentals and other services 161,764 135,394 71,717
Gain on sale of property and other 7,474 4,244 4,705
Interest 11,618 10,487 17,168
Dividends 2,791 2,657 2,482
--------- -------- --------
Total revenue 1,144,033 923,804 703,948
--------- -------- --------
Costs and Expenses:
Cost of goods sold 422,444 267,730 108,094
Cost of services 478,761 426,092 390,886
Selling, general & administrative 118,495 101,058 84,613
Interest 31,427 31,382 31,643
Interest capitalized (3,725) (2,580) (7,762)
Hurricane loss - - 24,803
--------- -------- --------
Total costs and expenses 1,047,402 823,682 632,277
--------- -------- --------
Income from Continuing Operations Before Income
Taxes, Discontinued Operations and Cumulative
Effect of Change in Accounting for
Post-retirement Benefits 96,631 100,122 71,671
Income taxes 32,652 41,386 19,044
--------- -------- --------
Income from Continuing Operations Before
Discontinued Operations and Cumulative
Effect of Change in Accounting for
Post-retirement Benefits 63,979 58,736 52,627
Discontinued Operations:
Income from Operations of Matson Leasing
Co. (net of income taxes) 10,629 8,253 7,878
Cumulative Effect of Change in Accounting
for Post-retirement Benefits
(net of income taxes) - - (41,551)
--------- -------- --------
Net Income $ 74,608 $ 66,989 $ 18,954
========= ======== ========
Earnings per Share of Common Stock:
Continuing Operations Before Discontinued
Operations and Cumulative Effect of Change in
Accounting for Post-retirement Benefits $ 1.39 $ 1.27 $ 1.14
Discontinued Operations 0.23 0.18 0.17
Cumulative Effect of Change in Accounting
for Post-retirement Benefits - - (0.90)
--------- -------- --------
Net Income $ 1.62 $ 1.45 $ 0.41
========= ======== ========
Average Common Shares Outstanding 46,059 46,338 46,294
========= ======== ========
ALEXANDER & BALDWIN, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Restated
(In thousands)
Year Ended December 31, 1994 1993 1992
- ------------------------------------------------------------------------------------------
Cash Flows from Operations:
Net income $ 63,979 $ 58,736 $ 11,076
Adjustments to reconcile net income to net cash
provided by operations:
Depreciation 84,037 78,318 69,769
Hurricane loss - - 24,803
Post-retirement benefits - - 41,544
Gain on disposals of property (5,700) (292) (1,246)
Capital expenditures for real estate
developments held for sale (6,817) (1,703) (22,517)
Changes in assets and liabilities:
Accounts and notes receivable 1,245 (2,666) (9,265)
Sugar Inventory 1,331 21,918 4,245
Other Inventory (220) (7,422) (967)
Prepaid expenses and other assets 26,328 10,038 7,357
Accounts payable (3,320) (4,416) (2,116)
Income taxes payable (4,539) (188) (8,472)
Deferred income taxes payable 21,819 30,738 13,332
Other liabilities (15,677) (13,783) (1,942)
--------- -------- --------
Net cash provided by operations 162,466 169,278 125,601
--------- -------- --------
Cash Flows from Investing Activities:
Capital expenditures for property (48,791) (109,315) (78,638)
Capital expenditures for real estate developments
held for investment (12,643) (12,875) (12,778)
Acquisition of California and Hawaiian
Sugar Company, Inc. - (62,564) -
Receipts from disposals of property,
investments and other assets 1,447 10,182 3,561
Deposits into Capital Construction Fund (8,900) - (31,025)
Withdrawals from Capital Construction Fund 9,383 87,495 27,335
Increase in investments (32) (1,108) (16,825)
--------- -------- --------
Net cash used in investing activities (59,536) (88,185) (108,370)
--------- -------- --------
Cash Flows from Financing Activities:
Proceeds from issuance of long-term debt 31,000 89,500 267,205
Payments of long-term liabilities (84,314) (112,651) (176,802)
Payments of short-term commercial paper (6,000) - -
Capital stock transactions 122 288 924
Repurchases of capital stock (17,717) - -
Dividends paid (40,563) (40,777) (40,744)
--------- -------- --------
Net cash provided by (used in)
financing activities (117,472) (63,640) 50,583
--------- -------- --------
Net increase in cash and cash equivalents from
continuing operations (14,542) 17,453 67,814
Net increase in cash and cash equivalents from
discontinued operations (8,592) (5,880) (65,584)
--------- -------- --------
Net increase (decrease) for the year ($ 23,134) $ 11,573 $ 2,230
========= ======== ========
