RICHMOND, Va., May 19, 2015 /PRNewswire/ --
HIGHLIGHTS
Fiscal Year 2015
Diluted earnings
per share of $4.06
Segment operating income of $167
million, down $8 million
Improved margins on slightly lower volumes
Revenues down 11% to $2.3 billion
Repurchased 3.1% of common shares outstanding
Fourth Quarter
Diluted earnings per share of
$1.64
Segment operating income of $53
million, up 18%
Revenues up 13% to $778 million on
higher sales volumes
George C. Freeman, III, Chairman,
President, and Chief Executive Officer of Universal Corporation
(NYSE: UVV), announced that net income for the fiscal year ended
March 31, 2015, was $114.6 million, or $4.06 per diluted share, compared with last
year's net income of $149.0 million,
or $5.25 per diluted share. Last
year's results included a gain of $81.6
million before tax ($53.1
million after tax, or $1.87
per diluted share), from the favorable outcome of litigation in
Brazil related to previous years'
excise tax credits. Results for the current fiscal year included a
further gain related to those tax credits, of $12.7 million before tax ($0.29 per diluted share) recorded in the fourth
fiscal quarter from updated projections of the utilization of the
credits before expiration. The current year also included an income
tax benefit of $8.0 million
($0.28 per diluted share) arising
from a subsidiary's payment of a portion of a fine following the
resolution of a court case. Pretax restructuring costs of
$4.9 million ($0.11 per diluted share) and $6.7 million ($0.15
per diluted share) were also incurred for fiscal years 2015 and
2014, respectively. Excluding those items in both years, net income
for the fiscal year increased $1.2
million ($0.07 per diluted
share) compared to the same period last year. Segment operating
income, which excludes those items, was $167.2 million for fiscal year 2015, a decrease
of $8.0 million from the prior year.
That reduction was primarily attributable to this year's lower
sales volumes, partially mitigated by a reduction in selling,
general, and administrative costs. Revenues of $2.3 billion for fiscal year 2015 declined 11%
compared with the previous year, driven mainly by those lower
overall volumes and modestly lower green leaf costs.
Net income for the fourth quarter ended March 31, 2015, was $45.8
million, or $1.64 per diluted
share, compared with net income for the prior year's fourth fiscal
quarter of $26.7 million, or
$0.94 per diluted share. The fourth
quarter results included restructuring costs before tax of
$0.4 million ($0.01 per diluted share) and $2.0 million ($0.04
per diluted share) for fiscal years 2015 and 2014, respectively. In
addition, the fourth fiscal quarter of 2015 included the
$12.7 million pretax gain
($0.29 per diluted share) related to
the reversal of the Brazilian excise tax credit allowance mentioned
above. Segment operating income for the period of $52.8 million improved by $7.9 million, or 18%, compared with the previous
fiscal year, as improved results in the Other Regions and
North America segments were partly
offset by a decline for the Other Tobacco Operations segment.
Consolidated revenues for the fourth fiscal quarter increased by
13% to $778.2 million, on higher
sales volumes in every segment, reflecting this year's later
shipping patterns and a better overall product mix, offset by lower
green leaf costs.
Mr. Freeman stated, "Given fiscal year 2015's oversupplied
market conditions, I am pleased with the results we achieved. We
ended the year with strong fourth quarter results, which helped to
bring our segment operating earnings for the fiscal year in line
with our expectations. We also realized higher margins, maintained
our solid financial position, and returned over $90 million to our shareholders in dividends and
share repurchases this fiscal year. Our performance demonstrates
our ability to execute well on our objective of delivering a
compliant product in an efficient manner to our customers, under
challenging circumstances.
"We are well-positioned as we enter fiscal year 2016 with
substantial cash balances and manageable uncommitted inventory
levels. Markets in Africa and
Brazil have opened at a similar
pace compared to last year, and crop qualities are mixed, with
production volumes expected to be lower in most origins. Although
we are not seeing significant delays in customer orders, we expect
shipping instructions to be weighted towards the second half of our
fiscal year. In addition, while our own leaf inventories are
well-managed, global tobacco leaf inventory volumes are high. This
may have the effect of extending the duration of the oversupply
conditions, despite reduced new crop production and a more positive
outlook for demand from some customers based on recent recoveries
in certain of their retail markets.
"Looking beyond near-term market conditions, we are optimistic
about the future as we believe there are several trends in our
business that could provide opportunities for us to increase our
market share and to offer additional services to our customers. We
have recently seen an increase in the level of supply chain
services, which include direct purchasing, that we provide our
customers, notably in the United
States, Mexico,
Brazil, and the Dominican Republic. We believe these moves
acknowledge the efficiencies and services that global leaf
suppliers bring to the entire supply chain. In addition, we believe
that compliant leaf requirements and reduction in sourcing
complexity will continue to be important to our customers and
should favor stable global leaf suppliers who are able to meet
these requirements."
FLUE-CURED AND BURLEY LEAF TOBACCO OPERATIONS:
OTHER REGIONS:
Operating income for the Other Regions segment for the fiscal
year ended March 31, 2015, was
$125.8 million, down 6% compared to
$133.4 million in the previous fiscal
year. The decrease was attributable mainly to reduced sales volumes
in all regions along with inventory writedowns, primarily in
Africa and South America, reflecting this year's
oversupply market conditions. The impact of those factors was
somewhat mitigated by improved gross margins, particularly in
Brazil, where volatile markets
increased green leaf costs last year, as well as benefits from
lower selling, general and administrative costs. Results for
Europe were also negatively
influenced by currency translation effects from a stronger U.S.
dollar. Selling, general, and administrative expenses for the
segment declined for the fiscal year, mostly from lower currency
remeasurement and exchange losses in the
Philippines and Brazil,
lower provisions for supplier advances, and positive comparisons of
value-added tax valuation allowances, partly offset by higher
customer claims. Revenues for the segment were down about 10% to
$1.7 billion, on reduced volumes and
lower average green leaf prices.
Operating income for the Other Regions segment for the quarter
ended March 31, 2015, increased by
17% to $35.8 million, compared with
the same period last year. The improved results were driven by
significantly higher volumes in South
America and Africa from
shipments delayed into the fourth quarter this year. Those benefits
were partially offset by lower sales in Europe and reduced volumes for the period in
Asia. Selling, general, and
administrative expenses for the Other Regions segment were higher
for the quarter, due to higher benefit and incentive compensation
accruals, larger currency remeasurement losses in Africa, and an unfavorable variance for
provisions for suppliers, partly offset by positive variances for
value-added tax valuation allowances. Revenues for the segment
increased by 16% to $566.4 million
for the fourth fiscal quarter compared to the prior year, on a
combination of higher volumes, an improved product mix, and lower
green leaf prices.
NORTH AMERICA:
Operating income for the North
America segment for the fiscal year ended March 31, 2015 was $31.1
million, up $7.8 million
compared with the previous year, on increased third party
processing business and a more favorable sales mix, despite lower
overall sales volumes. Revenues for the segment for fiscal year
2015 decreased by 13% to $305.0
million on reduced sales volumes and lower green leaf
prices. Segment operating income for the quarter ended March 31, 2015 also improved, by $4.6 million to $9.2 million, compared with the
same period last year. Those results were mostly driven by a more
favorable sales mix and higher processing volumes. Revenues for
this segment for the fourth fiscal quarter increased by 3% to
$101.2 million, primarily reflecting
higher processing revenues, while higher sales volumes were largely
offset by lower green leaf prices. Selling, general, and
administrative costs for this segment were relatively flat for both
periods.
OTHER TOBACCO OPERATIONS:
For the fiscal year ended March 31,
2015, the Other Tobacco Operations segment operating income
was down $8.2 million to $10.3
million compared with the same period of the prior year.
Results for the dark tobacco operations contributed significantly
to the decline, as lower sales volumes, in part due to shipment
timing, were partially mitigated by favorable currency
remeasurement comparisons, mainly in Indonesia. Results for the special services
group also contributed to the decline, reflecting startup costs for
the new food ingredients business. However, results from the
oriental joint venture improved for the fiscal year despite sales
volume declines influenced by shipment timing comparisons. The
impact from the volume declines was more than offset by favorable
variances from the prior year's currency remeasurement losses and
lower selling, general and administrative costs. Revenues for the
segment were down by $34.3 million to $227.0
million for the year ended March 31,
2015, compared to the previous year, primarily attributable
to the lower volumes for the dark tobacco operations, as well as
lower overall volumes and the timing of shipments of oriental
tobaccos into the United
States.
For the fourth quarter ended March 31,
2015, the segment's operating income declined by
$1.9 million to $7.7 million, compared to the same period last
year. Results for the dark tobacco operations were lower for the
quarter despite higher sales volumes, on lower margins and weaker
product mix from a decline in wrapper volumes, as well as higher
selling, general, and administrative costs mostly from comparisons
to currency remeasurement gains in the prior year fourth fiscal
quarter. Those declines were partly offset by benefits from the
timing of oriental tobaccos shipped into the United States that were delayed into the
fourth quarter this year. Revenues for this segment in the fourth
fiscal quarter increased by 8% to $110.5
million compared with the same period for the previous year.
Dark tobacco operations revenues increased on the higher sales
volumes, which were due in part to timing of shipments delayed into
the fourth quarter this year. Lower volumes and prices reduced
oriental tobacco revenues from shipments into the United States.
OTHER ITEMS:
Cost of goods sold decreased by about 12% to $1.9 billion for the fiscal year ended
March 31, 2015, consistent with lower
overall sales volumes and lower green leaf prices compared with the
previous year. For the quarter ended March
31, 2015, cost of goods sold increased by about 12%, to
$656.1 million, on a combination of
higher sales volumes and lower leaf prices. Selling, general, and
administrative costs decreased by $11.8
million for fiscal year 2015 and increased by $12.6 million for the fourth fiscal quarter,
compared with the respective prior periods. The decline for the
fiscal year was primarily related to lower currency remeasurement
and exchange costs, provisions for suppliers, and value-added tax
allowances, partly offset by higher customer claims. The increase
for the fourth quarter was attributable to higher benefit and
incentive compensation accruals, higher currency remeasurement
losses, mainly in Africa and
Indonesia, and an unfavorable
variance for losses on provisions for suppliers, partly offset by
positive comparisons of value-added tax valuation allowances.
Interest expense of $17.1 million
for fiscal year 2015 and $3.6 million
for the quarter ended March 31, 2015,
declined by about 16% and 2%, compared to respective periods in the
prior fiscal year. The reduction was mostly due to lower average
interest rates during the periods, offset in part by slightly
higher average debt balances. The consolidated effective income tax
rates on pretax earnings were approximately 24% and 33% for the
fiscal years ended March 31, 2015 and
2014, respectively. Income taxes for fiscal year 2015 were reduced
by a non-recurring benefit of $8.0
million arising from the partial payment of the European
Commission fine by our Italian subsidiary in June 2014. Excluding that item, the consolidated
effective tax rate for fiscal 2015 was about 29%. The effective
income tax rate for the quarter ended March
31, 2015, was about 25% compared with 31% for the same
period last year. The rates for all periods, excluding adjustments,
were below the 35% federal statutory rate mainly because of the
effect of changes in exchange rates on deferred income tax assets
and liabilities, as well as lower effective rates on dividend
income from certain foreign subsidiaries.
On December 30, 2014, the Company
executed a new senior unsecured credit facility agreement with a
group of banks, which consolidated and extended maturities of its
previous short-term revolving credit and long-term borrowing
facilities. The new agreement includes a $430 million 5-year revolving credit facility, a
$150 million 5-year term loan, and a
$220 million 7-year term loan. The
revolving credit facility contains terms and conditions that are
substantially similar to the Company's previous revolving credit
facility. The term loans, which were fully funded at closing,
require no amortization and are prepayable without penalty prior to
maturity. The facilities include a customary accordion feature
allowing for additional borrowings of up to $100 million under certain conditions. Currently,
borrowings under the revolving credit agreement bear interest at
variable rates based on LIBOR plus a margin of 1.50% to 1.75%. The
Company subsequently entered interest rate swap agreements to fix
the variable interest component of the 5- and 7-year term loans to
1.44% and 1.73%, respectively. The effective rates on the 5- and
7-year term loans were 2.94% and 3.48%, respectively, as of
May 18, 2015.
Additional information
Amounts included in the previous discussion are attributable to
Universal Corporation and exclude earnings related to
non-controlling interests in subsidiaries. In addition, the total
for segment operating income referred to in this discussion is a
non-GAAP measure. This measure is not a financial measure
calculated in accordance with GAAP and should not be considered as
a substitute for net income, operating income, cash from operating
activities or any other operating performance measure calculated in
accordance with GAAP, and it may not be comparable to similarly
titled measures reported by other companies. A reconciliation of
the total for segment operating income to consolidated operating
income is in Note 3. Segment Information, included in this earnings
release. The Company evaluates its segment performance excluding
certain significant charges or credits. The Company believes this
measure, which excludes these items that it believes are not
indicative of its core operating results, provides investors with
important information that is useful in understanding its business
results and trends.
This information includes "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995. The Company cautions readers that any statements contained
herein regarding earnings and expectations for its performance are
forward-looking statements based upon management's current
knowledge and assumptions about future events, including
anticipated levels of demand for and supply of its products and
services; costs incurred in providing these products and services;
timing of shipments to customers; changes in market structure;
government regulation; product taxation; industry consolidation and
evolution; and general economic, political, market, and weather
conditions. Actual results, therefore, could vary from those
expected. A further list and description of these risks,
uncertainties, and other factors can be found in the Company's
Annual Report on Form 10-K for the fiscal year ended March 31, 2014, and in other documents the
Company files with the Securities and Exchange Commission. This
information should be read in conjunction with the Annual Report on
Form 10-K for the fiscal year ended March 31, 2014.
At 5:00 p.m. (Eastern Time) on
May 19, 2015, the Company will host a
conference call to discuss these results. Those wishing to listen
to the call may do so by visiting www.universalcorp.com at that
time. A replay of the webcast will be available at that site
through August 4, 2015. A taped
replay of the call will be available through June 1, 2015, by dialing (855) 859-2056. The
confirmation number to access the replay is 47222214.
UNIVERSAL
CORPORATION
CONSOLIDATED
STATEMENTS OF INCOME
(in thousands of
dollars, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
Fiscal Year
Ended
March 31,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Sales and other
operating revenues
|
$
|
778,159
|
|
$
|
689,916
|
|
$
|
2,271,801
|
|
$
|
2,542,115
|
Costs and
expenses
|
|
|
|
|
|
|
|
Cost of goods
sold
|
656,068
|
|
586,712
|
|
1,861,527
|
|
2,108,824
|
Selling, general and
administrative expenses
|
73,061
|
|
60,471
|
|
250,186
|
|
262,013
|
Other
income
|
(12,676)
|
|
—
|
|
(12,676)
|
|
(81,619)
|
Restructuring
costs
|
397
|
|
2,038
|
|
4,890
|
|
6,746
|
Operating
income
|
61,309
|
|
40,695
|
|
167,874
|
|
246,151
|
Equity in pretax
earnings of unconsolidated affiliates
|
3,746
|
|
2,142
|
|
7,137
|
|
3,897
|
Interest
income
|
218
|
|
201
|
|
576
|
|
949
|
Interest
expense
|
3,611
|
|
3,684
|
|
17,120
|
|
20,307
|
Income before income
taxes
|
61,662
|
|
39,354
|
|
158,467
|
|
230,690
|
Income
taxes
|
15,287
|
|
12,145
|
|
38,006
|
|
75,535
|
Net income
|
46,375
|
|
27,209
|
|
120,461
|
|
155,155
|
Less: net income
attributable to noncontrolling interests in subsidiaries
|
(548)
|
|
(538)
|
|
(5,853)
|
|
(6,146)
|
Net income
attributable to Universal Corporation
|
45,827
|
|
26,671
|
|
114,608
|
|
149,009
|
Dividends on
Universal Corporation convertible perpetual preferred
stock
|
(3,687)
|
|
(3,713)
|
|
(14,824)
|
|
(14,850)
|
Cost in excess of
carrying value on repurchase of convertible perpetual preferred
stock
|
(18)
|
|
—
|
|
(36)
|
|
—
|
Earnings available to
Universal Corporation common shareholders
|
$
|
42,122
|
|
$
|
22,958
|
|
$
|
99,748
|
|
$
|
134,159
|
|
|
|
|
|
|
|
|
|
Earnings per share
attributable to Universal Corporation common
shareholders:
|
|
|
|
|
|
|
|
Basic
|
|
$
|
1.86
|
|
$
|
0.99
|
|
$
|
4.33
|
|
$
|
5.77
|
Diluted
|
|
$
|
1.64
|
|
$
|
0.94
|
|
$
|
4.06
|
|
$
|
5.25
|
UNIVERSAL
CORPORATION
CONSOLIDATED
BALANCE SHEETS
(in thousands of
dollars)
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
2015
|
|
2014
|
|
|
|
|
|
ASSETS
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
248,783
|
|
$
|
163,532
|
Accounts receivable,
net
|
|
434,362
|
|
468,015
|
Advances to
suppliers, net
|
|
114,883
|
|
134,621
|
Accounts
receivable—unconsolidated affiliates
|
1,907
|
|
7,375
|
Inventories—at lower
of cost or market:
|
|
|
|
|
Tobacco
|
|
636,488
|
|
639,812
|
Other
|
|
62,195
|
|
67,219
|
Prepaid income
taxes
|
|
17,811
|
|
27,866
|
Deferred income
taxes
|
|
36,611
|
|
22,052
|
Other current
assets
|
|
81,570
|
|
142,755
|
Total current
assets
|
|
1,634,610
|
|
1,673,247
|
|
|
|
|
|
Property, plant and
equipment
|
|
|
|
|
Land
|
|
16,790
|
|
17,275
|
Buildings
|
|
238,372
|
|
239,913
|
Machinery and
equipment
|
|
576,010
|
|
562,597
|
|
|
831,172
|
|
819,785
|
Less:
accumulated depreciation
|
|
(525,783)
|
|
(523,239)
|
|
|
305,389
|
|
296,546
|
Other
assets
|
|
|
|
|
Goodwill and other
intangibles
|
|
99,146
|
|
99,453
|
Investments in
unconsolidated affiliates
|
|
76,512
|
|
95,305
|
Deferred income
taxes
|
|
6,301
|
|
14,562
|
Other noncurrent
assets
|
|
76,515
|
|
91,794
|
|
|
258,474
|
|
301,114
|
|
|
|
|
|
Total
assets
|
|
$
|
2,198,473
|
|
$
|
2,270,907
|
UNIVERSAL
CORPORATION
CONSOLIDATED
BALANCE SHEETS
(in thousands of
dollars)
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
Current
liabilities
|
|
|
|
Notes payable and
overdrafts
|
|
$
|
59,862
|
|
$
|
62,905
|
Accounts payable and
accrued expenses
|
|
140,112
|
|
212,422
|
Accounts
payable—unconsolidated affiliates
|
|
3,281
|
|
65
|
Customer advances and
deposits
|
|
30,183
|
|
15,869
|
Accrued
compensation
|
|
28,232
|
|
31,772
|
Income taxes
payable
|
|
9,243
|
|
15,694
|
Current portion of
long-term obligations
|
|
—
|
|
116,250
|
Total current
liabilities
|
|
270,913
|
|
454,977
|
|
|
|
|
|
Long-term
obligations
|
|
370,000
|
|
240,000
|
Pensions and other
postretirement benefits
|
|
97,048
|
|
85,081
|
Other long-term
liabilities
|
|
36,790
|
|
34,457
|
Deferred income
taxes
|
|
26,628
|
|
45,500
|
Total
liabilities
|
|
801,379
|
|
860,015
|
|
|
|
|
Shareholders'
equity
|
|
|
|
Universal
Corporation:
|
|
|
|
Preferred
stock:
|
|
|
|
|
|
Series A Junior
Participating Preferred Stock, no par value, 500,000
shares authorized, none issued or outstanding
|
—
|
|
—
|
Series B 6.75%
Convertible Perpetual Preferred Stock, no par value,
220,000 shares authorized, 218,490 shares issued and
outstanding (219,999 at March 31, 2014)
|
211,562
|
|
213,023
|
Common
stock, no par value, 100,000,000 shares authorized,
22,593,266 shares issued and outstanding
(23,216,312 at March
31, 2014)
|
206,002
|
|
206,446
|
Retained
earnings
|
|
1,020,155
|
|
993,093
|
Accumulated other
comprehensive loss
|
|
(74,994)
|
|
(34,332)
|
Total Universal
Corporation shareholders' equity
|
|
1,362,725
|
|
1,378,230
|
Noncontrolling
interests in subsidiaries
|
|
34,369
|
|
32,662
|
Total shareholders'
equity
|
|
1,397,094
|
|
1,410,892
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
|
$
|
2,198,473
|
|
$
|
2,270,907
|
UNIVERSAL
CORPORATION
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(in thousands of
dollars)
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended
March 31,
|
|
|
2015
|
|
2014
|
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
|
|
|
|
Net income
|
|
$
|
120,461
|
|
|
$
|
155,155
|
Adjustments to
reconcile net income to net cash (used) provided by operating
activities:
|
|
|
|
Depreciation
|
|
35,394
|
|
|
37,257
|
Amortization
|
|
1,930
|
|
|
1,642
|
Provision for losses
on advances and guaranteed loans to suppliers
|
|
3,734
|
|
|
6,705
|
Inventory
write-downs
|
|
18,612
|
|
|
7,654
|
Stock-based
compensation expense
|
|
6,230
|
|
|
6,278
|
Foreign currency
remeasurement loss (gain), net
|
|
28,836
|
|
|
14,322
|
Deferred income
taxes
|
|
(13,662)
|
|
|
(2,176)
|
Equity in net income
of unconsolidated affiliates, net of dividends
|
|
(1,075)
|
|
|
3,420
|
Gain on
favorable outcome of excise tax case in Brazil
|
|
(12,676)
|
|
|
(81,619)
|
Restructuring
costs
|
|
4,890
|
|
|
6,746
|
Other,
net
|
|
(9,272)
|
|
|
2,251
|
Changes in
operating assets and liabilities, net
|
|
43,095
|
|
|
(161,138)
|
Net cash provided
(used) by operating activities
|
|
226,497
|
|
|
(3,503)
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
|
|
|
|
Purchase of property,
plant and equipment
|
|
(58,385)
|
|
|
(45,849)
|
Proceeds from sale of
property, plant and equipment
|
|
4,522
|
|
|
2,746
|
Other
|
|
(141)
|
|
|
1,033
|
Net cash
used by investing activities
|
|
(54,004)
|
|
|
(42,070)
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
|
|
|
|
Issuance (repayment)
of short-term debt, net
|
|
2,618
|
|
|
(43,727)
|
Issuance of long-term
obligations
|
|
370,000
|
|
|
175,000
|
Repayment of
long-term obligations
|
|
(356,250)
|
|
|
(211,250)
|
Dividends paid to
noncontrolling interests
|
|
(4,183)
|
|
|
(1,971)
|
Issuance of common
stock
|
|
187
|
|
|
457
|
Repurchase of
convertible perpetual preferred stock
|
|
(1,497)
|
|
|
—
|
Repurchase of common
stock
|
|
(31,227)
|
|
|
(14,145)
|
Dividends paid on
convertible perpetual preferred stock
|
|
(14,824)
|
|
|
(14,850)
|
Dividends paid on
common stock
|
|
(47,337)
|
|
|
(46,721)
|
Debt issuance costs
and other
|
|
(3,621)
|
|
|
(875)
|
Net cash
used by financing activities
|
|
(86,134)
|
|
|
(158,082)
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
|
(1,108)
|
|
|
(677)
|
Net increase
(decrease) in cash and cash equivalents
|
|
85,251
|
|
|
(204,332)
|
Cash and cash
equivalents at beginning of year
|
|
163,532
|
|
|
367,864
|
Cash and cash
equivalents at end of year
|
|
$
|
248,783
|
|
|
$
|
163,532
|
NOTE 1. BASIS OF PRESENTATION
Universal Corporation, with its subsidiaries ("Universal" or the
"Company"), is the leading global leaf supplier. Because of the
seasonal nature of the Company's business, the results of
operations for any fiscal quarter will not necessarily be
indicative of results to be expected for other quarters or a full
fiscal year. All adjustments necessary to state fairly the results
for the period have been included and were of a normal recurring
nature. These financial statements should be read in conjunction
with the financial statements and notes thereto included in the
Company's Annual Report on Form 10-K for the fiscal year ended
March 31, 2014.
NOTE 2. EARNINGS PER SHARE
The following table sets forth the computation of basic and
diluted earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
Fiscal Year
Ended
March 31,
|
(in thousands,
except per share data)
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
Basic Earnings Per
Share
|
|
|
|
|
|
|
|
|
Numerator for
basic earnings per share
|
|
|
|
|
|
|
|
|
Net income
attributable to Universal Corporation
|
|
$
|
45,827
|
|
$
|
26,671
|
|
$
|
114,608
|
|
$
|
149,009
|
Less: Dividends on
convertible perpetual preferred stock
|
|
(3,687)
|
|
(3,713)
|
|
(14,824)
|
|
(14,850)
|
Less: Cost in excess
of carrying value on repurchases of convertible perpetual preferred
stock
|
(18)
|
|
—
|
|
(36)
|
|
—
|
Earnings available to
Universal Corporation common shareholders for calculation of basic
earnings per share
|
$
|
42,122
|
|
$
|
22,958
|
|
$
|
99,748
|
|
$
|
134,159
|
|
|
|
|
|
|
|
|
|
Denominator
for basic earnings per share
|
|
|
|
|
|
|
|
|
Weighted
average shares outstanding
|
|
22,639,821
|
|
23,216,312
|
|
23,035,920
|
|
23,238,978
|
|
|
|
|
|
|
|
|
|
Basic
earnings per share
|
|
$
|
1.86
|
|
$
|
0.99
|
|
$
|
4.33
|
|
$
|
5.77
|
|
|
|
|
|
|
|
|
|
Diluted Earnings
Per Share
|
|
|
|
|
|
|
|
|
Numerator for
diluted earnings per share
|
|
|
|
|
|
|
|
|
Earnings available to
Universal Corporation common shareholders
|
|
$
|
42,122
|
|
$
|
22,958
|
|
$
|
99,748
|
|
$
|
134,159
|
Add: Dividends on
convertible perpetual preferred stock (if conversion
assumed)
|
3,687
|
|
3,713
|
|
14,824
|
|
14,850
|
Add: Cost in excess
of carrying value on repurchases of convertible perpetual preferred
stock
|
18
|
|
—
|
|
36
|
|
—
|
Earnings available to
Universal Corporation common shareholders for calculation of
diluted earnings per share
|
$
|
45,827
|
|
$
|
26,671
|
|
$
|
114,608
|
|
$
|
149,009
|
|
|
|
|
|
|
|
|
|
Denominator for
diluted earnings per share
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding
|
|
22,639.821
|
|
23,216.312
|
|
23,035.92
|
|
23,238.978
|
Effect of dilutive
securities (if conversion or exercise assumed)
|
|
|
|
|
|
|
|
|
Convertible
perpetual preferred stock
|
|
4,835,644
|
|
4,831,589
|
|
4,843,309
|
|
4,821,557
|
Employee
share-based awards
|
|
383,962
|
|
354,389
|
|
342,035
|
|
331,498
|
Denominator for
diluted earnings per share
|
|
27,859,427
|
|
28,402,290
|
|
28,221,264
|
|
28,392,033
|
|
|
|
|
|
|
|
|
|
Diluted earnings
per share
|
|
$
|
1.64
|
|
$
|
0.94
|
|
$
|
4.06
|
|
$
|
5.25
|
NOTE 3. SEGMENT INFORMATION
The principal approach used by management to evaluate the
Company's performance is by geographic region, although the dark
air-cured and oriental tobacco businesses are each evaluated on the
basis of their worldwide operations. The Company evaluates the
performance of its segments based on operating income after
allocated overhead expenses, plus equity in the pretax earnings of
unconsolidated affiliates.
Operating results for the Company's reportable segments for each
period presented in the consolidated statements of income were as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
Fiscal Year
Ended
March 31,
|
(in thousands of
dollars)
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
SALES AND OTHER
OPERATING REVENUES
|
|
|
|
|
|
|
|
|
Flue-cured and burley
leaf tobacco operations:
|
|
|
|
|
|
|
|
|
North
America
|
|
$
|
101,178
|
|
$
|
98,079
|
|
$
|
305,028
|
|
$
|
348,627
|
Other
regions (1)
|
|
566,439
|
|
489,319
|
|
1,739,781
|
|
1,932,228
|
Subtotal
|
|
667,617
|
|
587,398
|
|
2,044,809
|
|
2,280,855
|
Other tobacco
operations (2)
|
|
110,542
|
|
102,518
|
|
226,992
|
|
261,260
|
Consolidated sales
and other operating revenues
|
|
$
|
778,159
|
|
$
|
689,916
|
|
$
|
2,271,801
|
|
$
|
2,542,115
|
|
|
|
|
|
|
|
|
|
OPERATING
INCOME
|
|
|
|
|
|
|
|
|
Flue-cured and burley
leaf tobacco operations:
|
|
|
|
|
|
|
|
|
North
America
|
|
$
|
9,239
|
|
$
|
4,595
|
|
$
|
31,060
|
|
$
|
23,217
|
Other
regions (1)
|
|
35,795
|
|
30,650
|
|
125,839
|
|
133,447
|
Subtotal
|
|
45,034
|
|
35,245
|
|
156,899
|
|
156,664
|
Other tobacco
operations (2)
|
|
7,742
|
|
9,630
|
|
10,326
|
|
18,511
|
Segment operating
income
|
|
52,776
|
|
44,875
|
|
167,225
|
|
175,175
|
Deduct: Equity
in pretax earnings of unconsolidated affiliates
(3)
|
(3,746)
|
|
(2,142)
|
|
(7,137)
|
|
(3,897)
|
Restructuring costs (4)
|
|
(397)
|
|
(2,038)
|
|
(4,890)
|
|
(6,746)
|
Add: Other
income (5)
|
|
12,676
|
|
—
|
|
12,676
|
|
81,619
|
Consolidated
operating income
|
|
$
|
61,309
|
|
$
|
40,695
|
|
$
|
167,874
|
|
$
|
246,151
|
|
|
(1)
|
Includes South
America, Africa, Europe, and Asia regions, as well as inter-region
eliminations.
|
|
|
(2)
|
Includes Dark
Air-Cured, Special Services, and Oriental, as well as inter-company
eliminations. Sales and other operating revenues for this
reportable segment include limited amounts for Oriental because its
financial results consist principally of equity in the pretax
earnings of an unconsolidated affiliate.
|
|
|
(3)
|
Equity in pretax
(earnings) loss of unconsolidated affiliates is included in segment
operating income (Other Tobacco Operations segment), but is
reported below consolidated operating income and excluded from that
total in the consolidated statements of income.
|
|
|
(4)
|
Restructuring costs
are excluded from segment operating income, but are included in
consolidated operating income in the consolidated statements of
income.
|
|
|
(5)
|
Other income
represents the reversal of a valuation allowance on the remaining
unused balance of IPI excise tax credits in Brazil in fiscal year
2015 and the gain on the favorable outcome of the IPI tax credit
case in fiscal year 2014. These items are excluded from segment
operating income, but are included in consolidated operating income
in the consolidated statements of income.
|
|
|
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SOURCE Universal Corporation