SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES ACT OF 1934
Date of Report (Date of earliest event reported) August 11, 2003
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AMCON DISTRIBUTING COMPANY
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(Exact name of registrant as specified in its charter)
DELAWARE 0-24708 47-0702918
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
7405 Irvington Road, Omaha, NE 68122
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(Address of principal executive offices) (Zip Code)
(402) 331-3727
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name or former address, if changed since last report)
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
EXHIBIT NO. DESCRIPTION
99.1 Press release, dated August 11, 2003, issued
by AMCON Distributing Company
ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On August 11, 2003, AMCON issued a press release announcing its earnings for
the third quarter ended June 27, 2003. The press release is furnished
herewith as an exhibit and incorporated herein by reference.
The information in this Current Report (including the exhibit) shall not be
deemed to be "filed" for the purposes of Section 18 of the Securities
Exchange Act of 1934 or otherwise subject to the liabilities of that Section.
The information in this Current Report shall not be incorporated by reference
into any registration statement or other document pursuant to the Securities
Act of 1933, as amended.
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
AMCON DISTRIBUTING COMPANY
(Registrant)
Date: August 12, 2003 By : Michael D. James
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Name: Michael D. James
Title: Treasurer & Chief Financial
Officer
EXHIBIT INDEX
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Exhibit Description
99.1 Press release, dated August 11, 2003, issued by AMCON
Distributing Company
Exhibit 99.1
NEWS RELEASE
AMCON REPORTS 3RD QUARTER RESULTS
Omaha, NE, August 11, 2003 AMCON Distributing Company (AMEX:DIT), an Omaha,
NE based consumer products company, announced today that its net income was
$690,805 or $0.22 per diluted share for the third quarter ended June 2003
compared with net income of $842,593 or $0.26 per diluted share for the third
quarter of the prior year. Sales for the third quarter were $189.9 million
compared to $218.7 million for the same period in the prior year.
For the nine months ended June 2003, AMCON reported net income of $691,993 or
$0.22 per diluted share compared to $1,323,671 or $0.43 per diluted share for
the first nine months of the prior year. Sales for the nine months ended
June 2003 were $564.7 million compared to $623.0 million for the same period
of the prior year.
William F. Wright, Chairman of AMCON, stated that, "On a year to date
comparison, our pre-tax profit and cash flow numbers in our wholesale segment
improved dramatically. In that segment, net income before taxes was up over
28% despite a 12% drop in sales. That performance enabled us to show an
increase in cash flow from overall operations of over $17 million with a
resultant reduction in debt levels. In addition, with our operating line
usage at approximately 51% of availability and variable interest costs at
slightly below 4%, we locked in interest costs for approximately one-half of
our credit line usage for the next several years to keep those costs fixed
below 5%.
Our numbers for our retail health segment continue to improve as our new
management takes over and as our new, fully integrated systems become
implemented. As we near the end of this restructuring, we believe that we
are well positioned to further grow that segment in an efficient manner.
In our beverage business, Hawaiian Natural Water is showing greater sales as
its new production facility is completed and as construction of its packaging
and warehouse facility progresses. Our creation of The Beverage Group to
distribute Hawaiian Natural Water and other beverages on the United States
mainland is presently using a significant share of our earnings as it
establishes itself. In addition to securing exclusive distribution
contracts, major commitments need to be made to marketing and product
development firms, to retailers, and to brokers before sales of any
significance can be achieved and all of those expenditures are expensed as
they are incurred. The net results for the beverage segment were $0.8
million and $1.3 million lower than the prior year for the three and nine-
months ended June 2003, respectively. We anticipated this for the current
fiscal year and continue to believe that the beverage segment will ultimately
produce profits and significantly increase overall margins for our Company
and its shareholders.
Sales declined in our wholesale distribution business during the third
quarter due to a deflationary trend in cigarette prices for certain national
brands and a decline in cigarette carton volume of approximately 12.2%.
Carton volume declined primarily due to competitive factors, as well as,
consumers' continued shift of their buying habits toward value-priced brands
for which the Company's market share is limited.
In addition to the factors mentioned above, the change in after-tax earnings
for the quarter was impacted by the absence of a cigarette price increase,
reduced earnings from our private label products and reduced manufacturer
incentive allowances in our wholesale segment which, combined, were $1.9
million less than the third quarter of the prior year. These items were more
than offset by a favorable LIFO inventory adjustment of $1.2 million,
increases in profits from sales of non-cigarette products of $0.6 million,
reduction of operating expenses in our wholesale business of $0.4 million,
and a reduction in interest expense of $0.3 million, as compared to the third
quarter of the prior year.
For the nine months ended June 2003, the change in after-tax earnings was
also impacted by the absence of a cigarette price increase, reduced earnings
from our private label products and reduced manufacturer incentive allowances
in our wholesale segment which, combined, were $2.9 million less than the
first nine months of the prior year. These items were more than offset by a
favorable LIFO inventory adjustment of $1.1 million, increases in profits
from sales of non-cigarette products of $0.8 million, reduction of operating
expenses in our wholesale business of $1.2 million, reduction in interest
expenses of $0.4 million and gains on sales of available-for-sales securities
and other miscellaneous income of $0.1 million, as compared to the nine
months ended June 2002."
AMCON is a leading wholesale distributor of consumer products including
beverages, candy, tobacco, groceries, food service, frozen and chilled foods,
and health and beauty care products with distribution centers in Illinois,
Missouri, Nebraska, North Dakota, South Dakota and Wyoming. Chamberlin's
Natural Foods, Inc. and Health Food Associates, Inc., both wholly-owned
subsidiaries of The Healthy Edge, Inc. (formerly Food For Health Co., Inc.),
operate health and natural product retail stores in central Florida (7),
Kansas, Missouri, Nebraska and Oklahoma (3). The retail stores operate under
the names Chamberlin's Market & Cafe and Akin's Natural Foods Market.
Hawaiian Natural Water Company, Inc., which was acquired in December of 2001,
produces and sells natural spring water under the Hawaiian Springs label.
The water is bottled at the source on the Big Island of Hawaii. The Beverage
Group, Inc. markets and distributes Hawaiian Springs and other premium
beverage products in the United States, Canada and Mexico.
This news release contains forward looking statements that are subject to
risks and uncertainties and which reflect management's current beliefs and
estimates of future economic circumstances, industry conditions, Company
performance and financial results. A number of factors could affect the
future results of the Company and could cause those results to differ
materially from those expressed in the Company's forward looking statements.
Moreover, past financial performance should not be considered a reliable
indicator of future performance. Accordingly, the Company claims the
protection of the safe harbor for forward-looking statements contained in the
Private Securities Litigation Reform Act of 1995 with respect to all such
forward-looking statements.
Visit AMCON Distributing Company's web site at: www.amcon.com
AMCON Distributing Company and Subsidiaries
Condensed Consolidated Balance Sheets
June 2003 and September 2002
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(Unaudited)
June 2003 September 2002
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ASSETS
Current assets:
Cash $ 581,216 $ 130,091
Accounts receivable, less allowance for doubtful
accounts of $0.7 million and $0.6 million,
respectively 26,438,363 31,216,783
Inventories 23,765,698 35,744,074
Income tax receivable 357,239 981,054
Deferred income taxes 324,369 324,369
Other 560,958 393,365
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Total current assets 52,027,843 68,789,736
Fixed assets, net 16,181,578 16,096,124
Available-for-sale investments 671,494 562,000
Goodwill 6,091,402 6,091,402
Other intangible assets, net 11,523,058 11,804,284
Other assets 1,403,501 1,242,923
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$ 87,898,876 $ 104,586,469
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 14,018,737 $ 19,873,851
Accrued expenses 3,600,878 3,969,164
Accrued wages, salaries, bonuses 1,701,770 1,371,310
Current liabilities of discontinued operations 118,011 93,558
Current portion of long-term debt 7,840,070 14,783,967
Current portion of subordinated debt 1,752,667 1,708,986
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Total current liabilities 29,032,133 41,800,836
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Deferred income taxes 763,103 788,316
Non-current liabilities of discontinued operations 170,025 197,024
Long-term debt, less current portion 32,986,445 36,362,099
Subordinated debt, less current portion 7,853,067 8,738,886
Commitments and contingencies
Shareholders' equity:
Preferred stock, $.01 par value, 1,000,000
shares authorized, none outstanding - -
Common stock, $.01 par value, 15,000,000
shares authorized, 3,168,954 and 3,156,962
issued, respectively 31,690 31,570
Additional paid-in capital 5,997,977 5,977,643
Accumulated other comprehensive income,
net of tax of $0.2 million and $0.2 million,
respectively 252,880 294,771
Retained earnings 10,811,556 10,395,324
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Total shareholders' equity 17,094,103 16,699,308
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$ 87,898,876 $ 104,586,469
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AMCON Distributing Company and Subsidiaries
Condensed Consolidated Statements of Operations
for the three and nine-months ended June 2003 and 2002
(Unaudited)
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For the three months For the nine months
ended June ended June
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2003 2002 2003 2002
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Sales (including excise taxes of
$42.8 million and $42.7 million, and
$123.4 million and $119.5 million,
respectively) $ 189,949,079 $ 218,732,361 $ 564,678,909 $ 623,045,508
Cost of sales 173,924,679 202,677,900 520,979,369 577,650,180
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Gross profit 16,024,400 16,054,461 43,699,540 45,395,328
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Selling, general and administrative
expenses 13,628,524 12,873,782 38,803,228 37,986,850
Depreciation and amortization 574,332 743,610 1,706,844 2,197,531
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14,202,856 13,617,392 40,510,072 40,184,381
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Income from operations 1,821,544 2,437,069 3,189,468 5,210,947
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Other expense (income):
Interest expense 788,898 1,219,074 2,436,769 3,126,332
Other (85,159) (158,669) (367,294) (233,280)
Equity in loss of unconsolidated affiliate - - - 95,007
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703,739 1,060,405 2,069,475 2,988,059
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Income before income taxes 1,117,805 1,376,664 1,119,993 2,222,888
Income tax expense 427,000 534,071 428,000 899,217
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Net income $ 690,805 $ 842,593 $ 691,993 $ 1,323,671
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Earnings per share:
Basic $ 0.22 $ 0.27 $ 0.22 $ 0.44
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Diluted $ 0.22 $ 0.26 $ 0.22 $ 0.43
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Dividends per share $ 0.03 $ 0.03 $ 0.09 $ 0.09
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Weighted average shares outstanding:
Basic 3,168,955 3,112,962 3,165,270 3,004,852
Diluted 3,209,148 3,190,232 3,221,139 3,078,883
FOR FURTHER INFORMATION CONTACT:
Michael D. James
Chief Financial Officer
AMCON Distributing Company
Tel 402-331-3727
Fax 402-331-4834
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