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) December 23, 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 December 23, 2003, issued
by AMCON Distributing Company
ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On December 23, 2003, AMCON issued a press release announcing its earnings
for the fourth quarter ended September 26, 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: December 24, 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 December 23, 2003, issued by AMCON
Distributing Company
Exhibit 99.1
NEWS RELEASE
AMCON RELEASES 4TH QUARTER RESULTS
Omaha, NE, December 23, 2003 AMCON Distributing Company (AMEX:DIT), an
Omaha, NE based consumer products company, announced today net income of $0.3
million or $0.10 per diluted share for the fourth quarter ended September
2003 compared with $0.6 million or $0.20 per diluted share for the fourth
quarter of the prior year. Sales for the fourth quarter were $207.5 million
compared to $224.1 million for the same period in the prior year.
For the fiscal year ended September 2003, AMCON reported net income of $1.0
million or $0.32 per diluted share compared to $2.0 million or $0.63 per
diluted share for the prior year. Sales for fiscal year ended September 2003
were $772.1 million compared to $847.1 million for the same period of the
prior year.
William F. Wright, Chairman of AMCON, stated that, "Early last year we
decided to establish The Beverage Group ("TBG") to assist in the marketing
and distribution of our Hawaiian Springs brand, along with several other
specialty beverages. We chose that avenue rather than endeavoring to buy an
existing beverage company since we believed that prices for existing beverage
companies were unreasonable. By establishing TBG, the costs of such
establishment are deducted as expenses when incurred, rather than capitalized
as would have been the case in an acquisition. Approximately $0.57 per
diluted share of our earnings for this year went towards establishing TBG.
We believe that the wisdom of our decision will be validated in the future.
Sales in our wholesale distribution segment for the fourth quarter of fiscal
2003 were below the prior year as the deflationary trend in cigarette prices
continued through the fourth quarter and carton volume was 2.5% below the
fourth quarter of the prior year. These negative sales factors were
partially offset by an increase in sales of other products of $2.0 million in
our wholesale segment. Despite the reduction in sales, gross profit in the
wholesale segment was $0.5 million higher than the fourth quarter of fiscal
2002. In addition, operating expenses and interest expense were $0.8 million
lower than the prior year which resulted in the wholesale distribution
business generating pre-tax income of $1.2 million greater than the fourth
quarter of the prior year.
Sales in the retail health food business for the fourth quarter were $0.4
million greater than the prior year as our stores in the Midwest continued to
show improvement over the prior year. Pre-tax income in this segment was
also $0.1 million greater than the fourth quarter of the prior year.
Sales in our beverage segment increased only slightly over the prior year as
it still represents a business in the start-up phase. The formation of TBG
earlier in the year to market and distribute our Hawaiian Springs brand of
bottled natural spring water and other specialty beverages resulted in
significant expenses being incurred to develop markets for the brands. As a
result, the beverage business incurred a pre-tax loss of $2.3 million during
the fourth quarter of fiscal 2003."
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Wright added "For the year, our pre-tax profit and cash flow numbers in our
wholesale segment improved dramatically. In that segment, net income before
taxes of $7.6 million was up over 36% despite a 10% drop in sales. The
change in pre-tax earnings was adversely 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 $5.0 million less than the prior year. These items were more
than offset by a favorable LIFO inventory adjustment of $1.8 million,
increases in profits from sales of non-cigarette products of $1.4 million,
reduction of operating expenses and interest expense of $3.6 million, and an
increase in other income of $0.2 million.
That performance enabled us to show an increase in cash flow from overall
operations of over $5 million with a resultant reduction in debt levels. In
addition, with our operating line usage at less than 70% 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 continued to improve with sales
increasing by $1.4 million over the prior year. New management and a new,
fully integrated system implementation were the catalyst for improvement in
our Midwest stores in fiscal 2003. Based on this improvement, we plan to
open at least one new store in the Midwest in fiscal 2004 and will continue
to focus efforts on improving the performance of the Florida market.
In our beverage segment, Hawaiian Natural Water began to show greater sales
as its new production facility was completed and as construction of its
packaging and warehouse facility progressed towards final completion earlier
this month. Pre-tax results for the beverage segment for fiscal 2003 were
$3.8 million lower than the prior year. We anticipated this for the current
fiscal year and, as noted earlier, believe that the beverage segment will
produce profits and significantly increase overall margins for our Company
and its shareholders as our company continues to reduce its reliance upon our
wholesale segment."
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, including HYPE Energy Drink, Kona Coffee, Bottle Green and
Bahia drinks, and Xterra, a line of sports beverages and energy bars, in the
United States, Canada and Mexico.
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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
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AMCON Distributing Company and Subsidiaries
Consolidated Balance Sheet
September 2003 and 2002
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2003 2002
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ASSETS
Current assets:
Cash $ 668,073 $ 130,091
Accounts receivable, less allowance for doubtful
accounts of $0.8 million and $0.6 million in
2003 and 2002, respectively 28,170,129 31,216,783
Inventories 32,489,051 35,744,074
Income tax receivable - 981,054
Deferred income taxes 1,568,476 324,369
Other 581,950 393,365
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Total current assets 63,477,679 68,789,736
Fixed assets, net 16,951,615 16,096,124
Available-for-sale investments 512,694 562,000
Goodwill 6,091,397 6,091,397
Other intangible assets 11,420,542 11,804,289
Other assets 1,045,503 1,242,923
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$ 99,499,430 $ 104,586,469
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 15,092,091 $ 19,873,851
Accrued expenses 3,715,370 3,969,164
Accrued wages, salaries, bonuses 1,462,678 1,371,310
Income tax payable 540,414 -
Current liabilities of discontinued operations 117,612 93,558
Current portion of long-term debt 15,348,167 14,783,967
Current portion of subordinated debt 7,762,666 1,708,986
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Total current liabilities 44,038,998 41,800,836
Deferred income taxes 1,367,367 788,316
Noncurrent liabilities of discontinued operations 161,025 197,024
Long-term debt, less current portion 35,654,423 36,362,099
Subordinated debt, less current portion 976,220 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 in
2003 and 2002, respectively 31,690 31,570
Additional paid-in capital 5,997,977 5,977,643
Accumulated other comprehensive income, net of tax
of $0.1 million and $0.2 million in 2003 and 2002,
respectively 220,732 294,771
Retained earnings 11,050,998 10,395,324
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17,301,397 16,699,308
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$ 99,499,430 $ 104,586,469
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AMCON Distributing Company and Subsidiaries
Consolidated Statement of Operations
For the Three and Twelve Months Ended
September 2003 and 2002
Three Months ended September Twelve Months Ended September
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2003 2002 2003 2002
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Sales $ 207,456,442 $ 224,071,490 $ 772,135,351 $ 847,116,997
Cost of sales 190,994,785 207,542,702 711,974,154 785,192,882
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Gross profit 16,461,657 16,528,788 60,161,197 61,924,115
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Selling, general and
administrative expenses 14,246,496 13,623,569 53,049,723 51,610,419
Depreciation and amortization 577,764 966,019 2,284,608 3,163,549
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14,824,260 14,589,588 55,334,331 54,773,968
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Income from operations 1,637,397 1,939,200 4,826,866 7,150,147
Other expense (income):
Interest expense 833,007 1,146,451 3,269,777 4,272,783
Other income, net 268,910 (272,430) (98,384) (505,712)
Equity in loss of
unconsolidated affiliate - - - 95,007
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1,101,917 874,021 3,171,393 3,862,078
Income before income taxes 535,480 1,065,179 1,655,473 3,288,069
Income tax expense (benefit) 201,000 416,783 629,000 1,316,000
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Net income (loss) $ 334,480 $ 648,396 $ 1,026,473 $ 1,972,069
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Earnings per share:
Basic $ 0.10 $ 0.21 $ 0.32 $ 0.65
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Diluted $ 0.10 $ 0.20 $ 0.32 $ 0.63
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Weighted average shares outstanding:
Basic 3,166,191 3,112,962 3,166,191 3,032,484
Diluted 3,222,253 3,197,326 3,222,253 3,109,179
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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