Commodore's Financial Condition - The Facts
Bruce M. Franklin
This file is from the GEnie Starship. It represents a LOT of hard work.
It's the facts, not speculation
=========================================================================
Here's some information about Commodore from public records and SEC
filings, corporate databases and such. You will note that some of
the information was updated only after the posting of the final reports
of the last fiscal year [ending June] and some of it has been updated to
include the quarterly report released at the end of March.
NONE of this is speculation.
Commodore International Limited is the parent company of Commodore
Business Machines Inc, the people who operate the West Chester facility.
You will see the SEC records which list all owners of Commodore stock
in excess of 5%. There is only one, Irving Gould. He owns 19-20%.
Other insiders have very little stock, all things considered, but the
insider reports are here, too. Medhi Ali earns a higher yearly salary, but
his 300,000 shares of stock do not even leave him owning 1 percent.
You will see records of the debts, loans and other long term reports and
history included here. There are analysis statements of record from
professionals and SEC filings. There's probably more here than you ever
knew existed, let alone care about. :)
The Prudential loan is already overdue, and even after this length of
time, Commodore has been unable to raise the cash to pay it off. What
will be happening over the next week and month will determine the course
and future of the company and the technology which we love so dearly.
Many experts and industry watchers think only liquidation faces the
company now. Some hold out some hope that portions of the technology
could be acquired. If the lenders and creditor force the issue
before then, there may not even be negotiating room for that much.
I have cited sources of all this information enclosed in headers
which seperate it marked with: /*/*/*/*/*/*/*/*/*/*/*/*/*/
Those of you who are number crunchers may enjoy this information.
deb, from the *StarShip* on GEnie
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Corporate Affiliations
/*/*/*/*/*/*/*/*/*/*/*/*/*/
Commodore International Limited Commodore International Inc
P.O. Box N-10256 1200 Wilson Dr.
Nassau West Chester, PA 19380
Bahamas USA
Executives:
Chairman of the Board,Chief Executive Officer
Irving Gould/Chief Executive Officer
President
Mehdi R Ali/President
Vice President - No Function,Chief Financial Officer,Corporate Secretary
Ronald B Alexander/Corporate Secretary
Technical/Engineering/Technical Svcs
Lewis C Eggebrecht/Technical/Engineering/Technical Svcs
Vice President - No Function
Stephen Franklin/Vice President - No Function
Vice President - No Function,General Counsel
J Edward Goff/General Counsel
Vice President - No Function
Helmut Jost/Vice President - No Function
General Counsel
James W Olson/General Counsel
Vice President - No Function,Controller
Anthony D Ricci/Controller
Finance Executive-Other
Hock E Tan/Finance Executive-Other
Board of Directors: Gould, Irving; Ali, Mehdi R; Haig, Alexander M, Jr,
Gen; Seligman, Ralph D; Winberg, Burton
Corporate Family Hierarchy:
=>Commodore International Limited 1942036<=
Commodore Electronics Ltd (Subsidiary) 1942035
Commodore-Amiga Inc (US Subsidiary) 1942034
Commodore Business Machines Inc (US Subsidiary) 1942033
Commodore Software Div (Division) 1942032
Computer Systems Div (Division) 1942031
Consumer Products Group (Division) 1942030
Commodore International Limited (Division) 1942029
Commodore International Limited (Division) 1942028
Commodore Semiconductor Group (Division) 1942027
Commodore AB (Non-US Subsidiairy) 1942026
Commodore AG (Non-US Subsidiairy) 1942025
Commodore Buromaschinen GmbH (Non-US Subsidiairy) 1942024
Commodore Buromaschinen GmbH (Non-US Subsidiairy) 1942023
Commodore Business Machines Ltd (Non-US Subsidiairy) 1942022
Commodore Business Machines (Asia Pacific) Ltd (Non-US Subsidiairy) 194
2021
Commodore Business Machines (NZ) Ltd (Non-US Subsidiairy) 1942020
Commodore Business Machines (UK) Ltd (Non-US Subsidiairy) 1942019
Commodore Business Machines Pty Limited (Non-US Subsidiairy) 1942018
Commodore BV (Non-US Subsidiairy) 1942017
Commodore Computer GmbH (Non-US Subsidiairy) 1942016
Commodore Computers Norge A/S (Non-US Subsidiairy) 1942015
Commodore Computer NV/SA (Non-US Subsidiairy) 1942014
Commodore Data A/S (Non-US Subsidiairy) 1942013
Commodore Electronics Ltd (Non-US Subsidiairy) 1942012
Commodore Electronics Ltd (Non-US Subsidiairy) 1942011
Commodore France SARL (Non-US Subsidiairy) 1942010
Commodore Italiana SpA (Non-US Subsidiairy) 1942009
Commodore Japan Limited (Non-US Subsidiairy) 1942008
Commodore Networking Division (Non-US Subsidiairy) 1942007
Commodore Philippines BV (Non-US Subsidiairy) 1942006
Commodore Portuguesa Electronica SA (Non-US Subsidiairy) 1942005
Commodore SA (Non-US Subsidiairy) 1942004
/*/*/*/*/*/*/*/*/*/*/*/*/*/
S & P Online
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S & P Online remarks [last updated 12-Apr-94] in company information listing:
Makes multimedia computers, PC compatible computers, entry level
model... 3/25/94 in talks with creditors to restructure debt... may
become subject to reorganization or other liquidation proceeding if
unsuccessful... FY 93 (June) EPS fell to loss on 36% sales decline,
narrower gross margins, higher interest expense, inventory
writedowns... 1st half FY 94 loss narrowed despite 61% sales decline...
absence of non-recurring charge...
CEO has 19%.
Tel.# 215-431-9100
--------- EARNINGS PER SHARE ----------
6 Mo Dec -.54
..Prev. Yr. -2.90
Last 12 Mos -8.42
P/E def
5-Yr. Growth % ....
--------- DIVIDENDS PER SHARE ---------
Rate Nil
Yield
Last Div. None
Ex-Date 12/29
PayDate 01/31/65
------------ MARKET ACTION ------------
1994 Range
High 3.87
Low .37
Average Volume 59885
Beta 2.4
Institutional Holdings 2%
Primary Exchange NYSE
S&P Rank C
------------ BALANCE SHEET ------------
Current Ratio .64
Long Term Debt 18
Shares 33.08
Report of 06/30/93
(Long Term Debt and Shares in millions)
--------- FISCAL YEAR HISTORY ---------
Book
Fiscal Value
Year Net Per
Jun EPS Revenue Income Share
93 -10.78d 590.8 -356.5 ........
92 .82 911.0 27.6 9.84
91 1.73y 1047.2 57.4 8.87
90 .05 887.3 1.5 7.81
/*/*/*/*/*/*/*/*/*/*/*/*/*/
Company Profile on Record
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COMMODORE INTERNATIONAL LTD
Company Profile
COMMODORE INTERNATIONAL LTD Disclosure Co No: C527625
SASSOON HOUSE Ticker: CBU
SHIRLEY & VICTORIA CUSIP: 202660
NASSAU BAHAMAS , FF Exchange: NYS
PHONE: 8093223807
CROSS REFERENCE: WAS COMMODORE BUSINESS MACHINES CANADA LTD
DESCRIPTION OF BUSINESS:
DESIGNS, MANUFACTURES, MARKETS AND SUPPORTS A FULL LINE OF ADVANCED
MICROCOMPUTER SYSTEMS AND PERIPHERAL EQUIPMENT, INCLUDING COMPUTER SYSTEMS FOR
HOME, EDUCATION, PERSONAL AND SMALL BUSINESS MARKETS.
AUDITOR: COOPERS & LYBRAND (SOURCE: 10-K)
AUDITOR'S REPORT:
UNQUALIFIED;EXPLANATION, GOING CONCERN
We have audited the accompanying consolidated balance sheets of Commodore
International Limited (a Bahamian corporation) and subsidiaries (the Company)
as of 30 June 1993, and the related consolidated statements of operations,
shareholders' deficit and cash flows for the year then ended. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit. The consolidated financial statements of the Company for the years
ended 30 June 1992 and 1991 were audited by other auditors. The Company has not
obtained an updated auditors' report on the consolidated financial statements
for the years ended 30 June 1992 and 1991.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our report.
The accompanying consolidated financial statements have been prepared on the
basis of accounting principles applicable to a going concern. As discussed in
notes 1, 4, and 5 to the consolidated financial statements, the Company
experienced a significant decline in sales and incurred a loss of $356 million
for the year ended 30 June 1993, and had deficit equity of $53 million and
deficit working capital of $107 million as of 30 June 1993. In addition, the
Company was in default on various credit agreements and a mortgage loan. While
the Company is attempting to negotiate appropriate credit terms with suppliers
and restructure its credit arrangements with institutional lenders to allow the
Company to continue normal operations, in many of the countries in which the
Company operates, unlike the United States, the Company may not have the
ability to seek judicial protection to prevent liquidation while it reorganizes
its operations. All of these factors raise substantial doubt about the
Company's ability to continue as a going concern. Management's plans in regard
to these matters are also described in the notes to the consolidated financial
statements. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
Because of the possible material effects of the uncertainty about whether
the Company will continue as a going concern discussed in the preceding
paragraph, we are unable to express, and we do not express, an opinion on the
consolidated financial statements as of 30 June 1993 or for the year then
ended.
18 October 1993, except as to the information presented in paragraph 3 of
Note 5, for which the date is 1 November 1993
Incorporation State: BAHAMAS
Fiscal Year Ends: 6/30/1993
Shares Outstanding: 33,854,611
Shrs Held by Off/Dir: 1
Number of Employees: 1
Fortune Number: NA
D-U-N-S Number: NA
SIC'S: 3571 ELECTRONIC COMPUTERS
3577 COMPUTER PERIPHERAL EQ, NEC
SEC Filings
COMMODORE INTERNATIONAL LTD
Document Type Effective Date
------------- --------------
20-F 06/30/93
ARS 06/30/93
6-K 1 03/31/93
8-K 12/31/92
8-K 11/01/92
8-K 09/30/92
PROXY 09/28/92
ARS 06/30/92
COMMODORE INTERNATIONAL LTD
Exhibits
PRESS RELEASE, 12-31-92 (8-K 12-31-92)
COMMODORE INTERNATIONAL LTD
Corporate Events
PRESS RELEASE, 12-31-92 SECOND QUARTER REPORT (8-K 12-31-92) FILING, THIRD
QUARTERLY FINANCIALS (8-K 03-31-92)
FILING, FIRST QUARTER REPORT FOR PERIOD ENDED 09-30-92 (8-K 09-30-92)
/*/*/*/*/*/*/*/*/*/*/*/*/*/
Company Analyzer, Dialogue
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Dividends: [Yup, last dividend paid was in 1983]
Rate Type Ex-Date Record Payment
------------------------------------------------------------
1.500 Split 9/10/79 8/30/79 9/07/79
1.500 Split 3/03/80 2/22/80 2/29/80
3.000 Split 11/13/80 11/05/80 11/12/80
1.500 Split 5/04/82 4/21/82 5/03/82
2.000 Split 6/10/83 5/26/83 6/09/83
Dividends Available: 9/10/79 through 6/10/83
Stock History: April 91 to April 94
Friday Weeks Weeks Weeks Friday
Date Volume High/Ask Low/Bid Close/Avg
--------- ---------- ---------- ---------- ----------
4/05/91 2,828,200 21 5/8 17 5/8 20 7/8
4/12/91 1,610,900 20 3/4 19 19 5/8
4/19/91 2,207,700 19 3/4 18 1/4 18 1/2
4/26/91 2,434,600 20 17 1/2 18 1/8
5/03/91 2,906,000 18 1/4 14 1/4 15 1/8
5/10/91 1,168,100 15 5/8 14 3/4 15 1/4
5/17/91 1,975,100 17 15 1/4 15 1/4
5/24/91 859,500 16 3/8 15 1/8 16 1/4
5/31/91 636,500 16 3/4 15 3/4 16 1/2
6/07/91 1,153,800 17 3/4 15 1/8 15 1/2
6/14/91 1,129,400 15 5/8 14 1/4 14 1/2
6/21/91 3,104,500 14 1/2 11 5/8 12 1/2
6/28/91 1,832,400 12 3/4 10 7/8 11 5/8
7/05/91 842,400 13 11 5/8 12 3/8
7/12/91 1,225,200 14 12 1/4 13 1/4
7/19/91 553,000 13 3/8 12 12 3/4
7/26/91 433,100 12 7/8 12 1/8 12 7/8
8/02/91 1,476,000 15 1/8 12 3/4 14 1/2
8/09/91 2,879,600 14 7/8 11 1/2 12
8/16/91 1,135,800 12 1/2 11 5/8 11 5/8
8/23/91 1,731,100 11 1/4 10 1/4 11
8/30/91 713,400 11 1/4 10 3/4 11 1/4
9/06/91 787,400 11 7/8 10 1/8 10 1/2
9/13/91 931,000 11 1/4 10 3/8 10 5/8
9/20/91 1,120,500 12 1/8 10 5/8 12
9/27/91 1,230,900 12 7/8 11 3/8 12 1/2
10/04/91 1,234,600 13 1/4 12 1/8 12 5/8
10/11/91 1,392,400 13 7/8 12 1/4 13 1/2
10/18/91 1,450,400 13 7/8 12 1/2 13 1/2
10/25/91 2,395,600 14 7/8 12 7/8 13 3/4
11/01/91 731,500 14 7/8 13 5/8 14 3/8
11/08/91 999,100 15 1/8 14 1/4 14 5/8
11/15/91 742,400 14 3/4 12 7/8 12 7/8
11/22/91 800,000 13 1/2 12 1/4 12 1/4
11/29/91 508,700 13 12 1/4 12 7/8
12/06/91 575,900 14 1/4 12 1/2 12 5/8
12/13/91 518,300 13 1/4 12 5/8 13
12/20/91 832,600 13 1/2 12 1/8 12 1/4
12/27/91 4,150,200 18 1/8 12 16 3/4
1/03/92 1,233,500 16 1/2 15 1/2 16
1/10/92 1,594,400 17 3/8 15 3/4 16 1/8
1/17/92 2,863,600 17 1/2 15 1/4 17
1/24/92 3,248,500 19 1/4 16 1/4 19
1/31/92 4,185,300 17 3/4 15 15 3/8
2/07/92 1,842,600 15 3/4 14 1/2 15
2/14/92 961,300 15 3/4 14 3/4 14 7/8
2/21/92 843,500 14 7/8 14 14
2/28/92 1,585,500 14 5/8 13 5/8 14 1/8
3/06/92 1,515,200 15 3/8 13 5/8 13 3/4
3/13/92 1,013,800 14 7/8 13 3/4 14 3/8
3/20/92 765,900 14 5/8 13 3/4 13 7/8
3/27/92 4,589,000 16 1/4 12 7/8 15 1/4
4/03/92 1,155,000 15 3/8 14 1/8 14 3/8
4/10/92 1,120,200 14 5/8 13 1/8 13 7/8
4/17/92 540,900 14 1/4 13 5/8 13 3/4 #
4/24/92 782,900 13 5/8 13 13 1/2
5/01/92 1,841,300 13 3/8 11 1/8 12 1/8
5/08/92 1,287,900 12 7/8 12 12 1/8
5/15/92 635,700 12 1/4 11 3/8 11 1/2
5/22/92 491,500 12 11 1/2 11 3/4
5/29/92 262,700 11 7/8 11 3/8 11 3/8
6/05/92 731,400 12 1/2 11 1/2 11 3/4
6/12/92 431,600 12 1/8 11 1/4 11 3/8
6/19/92 599,200 11 3/8 10 1/8 10 1/4
6/26/92 742,600 10 1/4 9 1/2 9 5/8
7/03/92 598,800 10 5/8 9 1/2 10 1/8 #
7/10/92 590,200 10 1/4 9 1/4 9 3/8
7/17/92 553,100 9 7/8 9 1/8 9 1/2
7/24/92 500,300 9 3/4 9 9 5/8
7/31/92 450,000 9 5/8 9 1/4 9 5/8
8/07/92 703,400 10 1/4 9 3/8 9 1/2
8/14/92 213,700 9 1/2 9 1/8 9 1/4
8/21/92 2,576,300 9 3/8 6 3/4 7 1/8
8/28/92 1,027,300 7 5/8 6 7/8 7 1/2
9/04/92 912,300 8 1/2 7 3/8 8 1/2
9/11/92 492,500 8 5/8 7 7/8 8
9/18/92 513,000 8 1/4 7 3/8 7 1/2
9/25/92 443,600 7 3/4 7 1/8 7 1/4
10/02/92 341,900 7 3/8 7 7
10/09/92 454,200 7 1/8 6 3/4 7
10/16/92 876,700 8 1/8 6 7/8 7 1/2
10/23/92 453,000 7 7/8 7 3/8 7 3/8
10/30/92 324,400 7 3/4 7 1/4 7 1/4
11/06/92 1,140,800 7 3/4 6 3/4 7 1/4
11/13/92 836,400 7 7/8 7 7 1/2
11/20/92 344,100 7 3/4 7 7 5/8
11/27/92 331,600 7 5/8 7 1/8 7 3/8
12/04/92 1,766,100 9 1/4 7 3/8 8 5/8
12/11/92 978,900 8 5/8 7 1/2 7 3/4
12/18/92 691,200 8 7 1/2 7 3/4
12/25/92 562,800 7 3/4 7 1/4 7 3/8 #
1/01/93 1,134,800 7 1/2 7 7 1/8 #
1/08/93 1,208,600 7 1/4 6 1/8 6 1/4
1/15/93 756,400 6 3/4 6 1/4 6 1/4
1/22/93 826,900 7 1/4 6 1/4 7 1/4
1/29/93 1,044,200 7 5/8 6 3/8 6 1/2
2/05/93 1,523,800 6 3/4 5 1/4 5 1/2
2/12/93 879,600 6 3/8 5 5/8 6
2/19/93 423,000 6 1/8 5 5/8 5 7/8
2/26/93 666,200 5 7/8 5 3/8 5 1/2
3/05/93 592,700 5 5/8 5 1/4 5 3/8
3/12/93 1,054,800 5 3/8 4 3/4 5 1/4
3/19/93 733,400 5 5/8 5 1/8 5 1/2
3/26/93 446,900 5 1/2 5 5
4/02/93 293,900 5 1/8 4 7/8 4 7/8
4/09/93 303,900 5 1/8 4 7/8 4 7/8 #
4/16/93 579,700 5 4 3/8 4 5/8
4/23/93 520,600 5 4 1/4 4 1/2
4/30/93 352,700 4 1/2 4 1/4 4 1/4
5/07/93 792,400 4 3/8 3 1/2 3 5/8
5/14/93 757,700 4 1/2 3 5/8 4 3/8
5/21/93 398,400 4 1/2 4 4 1/8
5/28/93 643,900 4 1/4 3 3/4 4
6/04/93 2,434,100 3 3/8 2 5/8 3
6/11/93 1,105,500 3 1/4 2 7/8 2 7/8
6/18/93 607,900 3 2 5/8 2 7/8
6/25/93 757,100 2 7/8 2 1/2 2 3/4
7/02/93 446,400 3 2 5/8 3
7/09/93 877,200 3 7/8 3 1/8 3 5/8
7/16/93 386,900 3 3/4 3 1/2 3 5/8
7/23/93 229,300 3 5/8 3 3/8 3 1/2
7/30/93 231,400 3 1/2 3 1/8 3 3/8
8/06/93 228,700 3 5/8 3 1/4 3 5/8
8/13/93 396,100 3 7/8 3 1/2 3 5/8
8/20/93 189,400 3 5/8 3 3/8 3 5/8
8/27/93 171,000 3 1/2 3 3/8 3 1/2
9/03/93 352,600 3 7/8 3 3/8 3 3/4
9/10/93 223,400 3 3/4 3 1/2 3 5/8
9/17/93 233,400 3 5/8 3 1/4 3 1/4
9/24/93 212,200 3 1/2 3 1/8 3 1/8
10/01/93 226,100 3 1/4 3 3 1/8
10/08/93 334,500 3 1/2 3 3 1/4
10/15/93 248,200 3 5/8 3 1/4 3 1/4
10/22/93 415,800 3 1/2 2 7/8 3
10/29/93 174,000 3 1/8 3 3
11/05/93 1,757,900 4 5/8 2 7/8 4 1/4
11/12/93 899,600 4 1/4 3 3/8 3 7/8
11/19/93 570,100 4 3 1/2 4
11/26/93 237,500 4 3 3/4 3 3/4
12/03/93 525,200 4 3 3/8 3 1/2
12/10/93 361,300 3 1/2 3 3/8 3 1/2
12/17/93 565,000 3 7/8 3 3/8 3 3/8
12/24/93 438,500 3 5/8 3 1/8 3 1/4 #
12/31/93 1,017,300 3 1/2 3 3
1/07/94 609,000 3 3/4 3 3 3/4
1/14/94 231,600 3 3/4 3 1/4 3 3/8
1/21/94 302,900 3 3/8 3 1/8 3 3/8
1/28/94 727,000 3 3/8 3 3 3/8
2/04/94 428,600 3 3/8 3 3 1/8
2/11/94 226,100 3 1/4 3 3
2/18/94 424,600 3 1/4 3 3 1/4
2/25/94 160,100 3 1/4 3 3 1/4
3/04/94 612,100 3 7/8 3 3 1/4
3/11/94 246,400 3 3/8 3 3 1/8
3/18/94 199,500 3 1/4 3 3 1/8
3/25/94 236,400 3 1/8 3 3
4/01/94 58,000 1 1/2 3/8 3/4 #
4/08/94 472,900 1 1/8 7/16 7/8
4/15/94 371,500 1 1/16 3/4 7/8
4/22/94 46,800 1 5/8 1
# indicates 'last' is from an earlier date in the period
Prices Available: 9/21/81 through 4/22/94
>>> Officers and Directors Salaries
Officers and Directors
COMMODORE INTERNATIONAL LTD
Name Age Salary Title
------------------------------ --- ----------- ------------------------------
Officers
--------
ALI, MEHDI R. 49 N/A PRESIDENT
TAN, HOCK E. N/A VICE PRESIDENT
' ' CHIEF FINANCIAL OFFICER
HELMSOE-ZINCK, JOHN N/A VICE PRESIDENT
Directors 9/28/1992
---------
ALI, MEHDI R. 48 2,000,000 PRESIDENT
' ' NOMINEE
GOULD, IRVING 73 1,750,000 CHAIRMAN OF THE BOARD
' ' CHIEF EXECUTIVE OFFICER
HAIG, ALEXANDER M., JR. 67 N/A NA
SELIGMAN, RALPH D. 72 N/A NA
WINBERG, BURTON 68 N/A NOMINEE
>>> Management Discussion:
COMMODORE INTERNATIONAL LTD
Management Discussion
Commodore International Limited and Subsidiaries
Management's Discussion and Analysis of Financial Condition and Results of
Operations
This review should be read in conjunction with the consolidated financial
statements and related notes beginning on page 6 of this annual report.
Basis of Presentation As a result of the significant loss of $356 million
for fiscal 1993 the Company had deficit equity of $53 million and deficit
working capital of $107 million as of 30 June 1993. The Company's financial
position and operating results raise substantial doubts about the Company's
ability to continue as a going concern. As of 30 June 1993 the Company was in
default on various credit agreements. See Footnote 1 for further information.
Sales Commodore's net sales decreased 35% in fiscal 1993 to $591 million
compared with $911 million in fiscal 1992 and $1,047 in fiscal 1991. The
decline in fiscal 1993 and the later half of fiscal 1992 was due to economic
softness throughout all major markets, especially Europe, and intense
competitive pricing pressure.
The Amiga product line accounted for almost three fourths of the total
sales decline for the year. Approximately half of the Amiga sales decline was
attributable to unit volume and the other half was attributable to pricing
declines. Unit sales of Amiga computers were slightly over 800,000 units in
fiscal 1993 compared with 1 million units in fiscal 1992. Unit sales of Amiga
computers declined 20% in fiscal 1993 compared with increases of 17% in fiscal
1992 and 38% in fiscal 1991. Revenues of the Amiga product line decreased by
40% in fiscal 1993 compared with a decline of 1% in fiscal 1992 and an increase
of 23% in fiscal 1991. The decrease in fiscal 1992 was due to a significant
decrease in sales of peripherals, such as monitors , and pricing reductions.
The Amiga product line accounted for 59% of net sales in fiscal 1993 compared
with 63% in fiscal 1992 and 56% in fiscal 1991.
MS-DOS PC compatible products accounted for 37% of net sales in fiscal 1993
compared with 24% in fiscal 1992 and 28% in fiscal 1991. Unit sales increased
17% in fiscal 1993, but revenues increased only nominally due to competitive
pricing pressure. In fiscal 1992 unit sales and revenues declined 23% due to a
discontinuation of low-end PCs. In fiscal 1991 unit sales declined 3% but
revenues increased 14% due to a shift to high-end products. Due to low
profitability the Company decided to discontinue the sale of MS-DOS PCs and
licensed the brand name for PC sales in Europe to another supplier.
C64 products accounted for only 4% of net sales in fiscal 1993 compared
with 13% in fiscal 1992 and 16% in fiscal 1991. In fiscal 1993 C64 unit sales
declined to less than 200,000 units compared with 650,000 units in fiscal 1992
and over 800,000 units in fiscal 1991. Revenues from C64 products decreased
over 80% in fiscal 1993 and 34% in fiscal 1992 and increased 4% in fiscal 1991.
Geographically, European markets accounted for 84% of net sales in fiscal
1993 compared with 88% in 1992 and 84% in 1991. North American sales accounted
for 10% of sales in fiscal 1993 compared with 8% in 1992 and 11% in 1991.
Australia/Asia sales accounted for 6% of sales in fiscal 1993 compared with 4%
in 1992 and 5% in 1991.
The US dollar fluctuated in relation to European currencies during fiscal
1993 with a mixed impact on reported sales. The effect of currency movements
increased reported sales during the first quarter of fiscal 1993 but decreased
reported sales during the last three quarters. The dollar value of sales for
fiscal 1993 would have been approximately $14 million higher if prior year
exchange rates had been in effect. In fiscal 1992 the effect of currency
movements decreased reported sales during the first two quarters and increased
reported sales during the fourth quarter, with only a nominal impact on sales
for the third quarter. The dollar value of sales for fiscal 1992 would have
been approximately $25 million higher if prior year exchange rates had been in
effect. In fiscal 1991, the effect of currency movements increased reported
sales during the first three quarters but decreased reported sales during the
fourth quarter. The dollar value of sales for fiscal 1991 would have been
approximately $94 million lower if prior year exchange rates had been in
effect.
Since a substantial portion of the Company's sales are denominated in
European currencies, reported U.S. dollar sales will continue to be affected by
the strengthening or weakening of U.S. dollar versus European currencies. The
sales in the second quarter of each year reflect the seasonal impact of
Christmas.
Profitability Gross margin was a loss of $132 million in fiscal 1993
compared with a profit of $246 million, or 27% of net sales on fiscal 1992 and
$333 million, or 32% of net sales in fiscal 1991. The loss in fiscal 1993 was
attributable to the sales decline and to writedowns of inventory, fixed assets
and other assets, and significant pricing and promotional allowances resulting
from severe competitive pricing pressure. The decrease in gross margin in
fiscal 1992 was due primarily to lower prices for MS-DOS PC compatibles and
unfavorable effects of foreign currency exchange rate fluctuations. In fiscal
1991 the gross margin was impacted by favorable effects of foreign currency
exchange rate fluctuations.
In fiscal 1993 operating expenses included $50 million of restructuring and
other unusual charges, including severance and costs for early cancellation of
leases. Excluding these charges operating expenses in fiscal 1993 were $152
million or 26% of net sales compared with $215 million or 24% of net sales in
fiscal 1992 and $259 million or 25% of net sales in fiscal 1991. In fiscal
1992, operating expenses were tightly controlled and declined 17% compared with
a sales decline of 13%. In fiscal 1991, operating expenses were also tightly
controlled and increased only 3% compared with a sales increase of 18%. Selling
and marketing expenses decreased 39% to $84 million in fiscal 1993 due to a
reduction in advertising and other selling expenses, compared with $137 million
in 1992 and $174 million in 1991. General and administrative expenses decreased
7% to $49 million in fiscal 1993, compared with $52 million in 1992 and $54
million in 1991. Research and development expenses decreased 24% to $19 million
in fiscal 1993 compared with $26 million in 1992 and $31 million in 1991.
Net interest expense was $18 million in fiscal 1993 compared with $15
million in 1992 and 1991. Other expense was $4 million in fiscal 1993 and $6
million in 1991. In fiscal 1992 other income was $9 million and included $14
million in net gains from the sale of certain properties and investments
reduced by other expenses of $5 million.
In fiscal 1993 the net loss for the year of $356 million, or $10.78 per
share, included $237 million for asset writedowns, restructuring costs and
special pricing and promotional allowances. In fiscal 1992 net income of $28
million, $0.82 per share, included an income tax benefit of $2 million. In
fiscal 1991 pre-tax income was $52 million and the income tax benefit was $5
million due to the reduction of certain income tax accruals no longer needed to
meet certain tax contingencies. In fiscal 1991 income before extraordinary item
was $57 million or $1.73 per share and there was an extraordinary charge of $9
million, or $0.28 per share, for the court settlement of litigation. Net income
for fiscal 1991 was $48 million or $1.45 per share.
Liquidity and Capital Resources In fiscal 1993 the Company's cash and cash
equivalents decreased by $56 million to $10 million as of 30 June 1993 compared
with an increase of $1 million in fiscal 1992. The major activities were as
follows (in millions): (Table Follows)
Despite the net loss of $356 million in fiscal 1993, the cash used for
operations was only $16 million due primarily to decreases of over $120 million
each for accounts receivable and inventories and non-cash charges of over $50
million for depreciation and amortization and writedown of long-term assets. In
fiscal 1992 net income of $28 million accounted for the major portion of the
cash provided from operations of $32 million.
In fiscal 1993 capital expenditures accounted for $20 million of the total
$26 million cash used for investing activities. The major additions included a
new building in Germany which was under construction in 1992, additional
manufacturing equipment and tooling for new products. In fiscal 1992 capital
expenditures were $25 million but there was significant cash received from
property dispositions resulting in cash used for investing activities of $12
million.
In fiscal 1993 long-term debt payments were $32 million, including $25
million to two institutional lenders. In fiscal 1992 long-term debt payments
were $93 million, including $66 million of seven-year Deutsche Mark debentures
which had matured and $25 million to two institutional lenders. In fiscal 1993
net new borrowings were $20 million (including $17 million from a company
controlled by the chairman of Commodore) resulting in net cash used for
financing activities of $12 million. In fiscal 1992 new borrowings, primarily
short-term bank borrowings, offset a significant amount of the repayments
resulting in net cash used for financing activities of $19 million.
As of 30 June 1993 short-term debt included $50 million from various banks
in 18 countries and $7.5 million from a company controlled by the chairman of
Commodore. The bank loans are not collateralized and as of 30 June 1993 there
were no unused short-term lines of credit available.
As of 30 June 1993 the Company was in default under the provisions of
certain long-term collateralized and other obligations totaling $51.7 million.
For financial statement purposes these amounts have been classified as current
debt.
As of 30 June 1993 the Company had total current assets of $194 million
with total current debt of $114 million, and accounts payable and accrued
liabilities of $187 million, resulting in a deficit working capital of $107
million. As a result of the deficit the Company has found it necessary to delay
payments to creditors. A successful debt restructuring is critical to the
Company's ability to continue as a going concern. The Company is attempting to
negotiate appropriate credit terms with suppliers who have restricted the
Company's credit and intends to work out a restructuring plan with its
creditors, including those which have instituted legal action against the
Company, to allow the Company to continue normal operations. However, there can
be no assurance that a successful debt restructuring will be achieved.
>>> Footnotes to the annual report, fiscal year ending 30 June 93:
COMMODORE INTERNATIONAL LTD
Footnotes
(SOURCE 20-F)
Notes to consolidated financial statements
Commodore International Limited and Subsidiaries
30 June 1993
1. Basis of Presentation-For the fiscal year ended 30 June 1993 the Company
experienced a 35% sales decline and a net loss of $356.5 million. The loss
included $237 million for asset writedowns, restructuring costs and special
pricing and promotional allowances, of which $50 million is included in
operating expenses and the remaining balance is included in cost of sales. The
loss has resulted in deficit equity of $53 million and deficit working capital
of $107 million as of 30 June 1993.
The Company's consolidated financial statements have been prepared on the
basis of accounting principles applicable to a "going concern", which
contemplates continuity of the Company's operations and the realization of its
assets and the payment of its liabilities in the ordinary course of business.
However, the Company's financial position and operating results raise
substantial doubts about the Company's ability to continue as a going concern.
The financial statements do not reflect adjustments that would be required
should the Company be unable to continue as a going concern.
The Company has addressed its current financial difficulties by
restructuring the business in a number of ways including eliminating
unprofitable product lines to focus exclusively on Amiga products. A new Amiga
CD(32) was launched in September 1993 and the plan is dependent upon
significant future sales of this product. With the restructuring actions taken
in fiscal 1993 it is expected that the total expenses for fiscal 1994 will be
significantly below fiscal 1993.
The Company is attempting to negotiate appropriate credit terms with
suppliers who have restricted the Company's credit and intends to work out a
restructuring plan with its creditors, including those which have instituted
legal action against the Company, to allow the Company to continue normal
operations. However, there can be no assurance that a successful debt
restructuring will be achieved.
The Company's long-term liquidity needs cannot reasonably be determined at
this time principally because these needs are dependent, in large part, upon
the outcome of the Company's debt restructuring.
2. Summary of Accounting Policies-Commodore International Limited is
incorporated in the Bahamas. The Consolidated financial statements of Commodore
International Limited and Subsidiaries (the Company) have been prepared in
accordance with accounting principles generally accepted in the United States.
Within those principles, the Company's more important accounting policies are
set forth below.
Principles of Consolidation-The consolidated financial statements include
the accounts of all majority-owned subsidiaries. All significant intercompany
transactions have been eliminated.
Translation of Non-U.S. Currencies-Assets and liabilities recorded in
functional currencies other than U.S. dollars are translated at current
exchange rates. The resulting adjustments are charged or credited directly to
cumulative translation adjustment in the shareholders' equity section of the
consolidated balance sheets. Sales and expenses are translated at the weighted
average exchange rates for the period. Foreign currency transaction gains and
losses are included in income in the period in which they occur. Foreign
currency transaction gains (losses) were $(28.1) million, $16.5 million and
$(10.2) million for fiscal 1993, 1992 and 1991, respectively.
Cash and Cash Equivalents-The Company has included cash, overnight deposits
and time deposits with maturities less than 91 days as cash and cash
equivalents.
Accounts Receivable-At 30 June 1993 and 1992 a majority of the trade
accounts receivable were due from distributors and dealers within the personal
computer industry.
Inventories-Inventories are stated at the lower of cost (first-in,
first-out) or market, and included material, labor and overhead. Intercompany
profits are eliminated from inventory valuations. Inventories, net of reserves
of $58 million at 30 June 1993 and $14 million at 30 June 1992, consisted of
the following (000s omitted):
30 June 30 June
1993 1992
Raw materials and work-in process $20,700 $76,300
Finished goods 59,000 128,100
$79,700 $204,400
Property and Equipment-Major classes of property and equipment were as follows
(000s omitted):
30 June 30 June Estimated
Description 1993 1992 Useful Lives
Land $ 1,900 $ 1,600
Buildings and improvements 48,000 42,700 10-40 years
Machinery and equipment 67,800 102,000 3-10 years
Furniture and fixtures 8,700 13,900 3-10 years
Tooling 2,200 8,100 2-3 years
Leasehold improvements 14,300 15,300 Lease Term
$142,900 $183,600
Depreciation has been provided over the estimated useful lives of the assets
using primarily the straight-line method. Expenditures for additions, renewals,
and betterments are capitalized. Maintenance and repairs are expensed as
occurred. Upon sale or other disposition, the applicable amounts of asset cost
and accumulated depreciation are removed from the accounts and the net amount,
less proceeds from disposal, is charged or credited to income.
Income Taxes-The Company and its subsidiaries provide taxes on income in
accordance with the enacted tax rules and regulations of the many taxing
jurisdictions where income is earned. The income tax rates imposed by these
jurisdictions vary substantially. Taxable income may differ from pretax income
for financial accounting purposes. Deferred taxes are based on the estimated
future tax effects of differences between the financial statements and tax
bases of assets and liabilities. The Company does not provide income taxes on
undistributed earnings of foreign subsidiaries which are permanently
reinvested.
Investment credits and other allowances provided by income tax laws of
respective countries are credited to current income tax expense under the
flow-through method of accounting.
In fiscal 1992, the Company implemented the provisions of Statement of
Financial Accounting Standards (Statement) No. 109, "Accounting for Income
Taxes." Statement No. 109 utilize the liability method of accounting for income
taxes. The effect of adopting Statement No. 109 was not significant.
Revenue Recognition-Sales are recognized when products are shipped or title
is transferred to the customer, net of allowances for estimated returns and
discounts. Anticipated warranty costs are provided in the same period in which
the corresponding revenues are generated.
Research and Development Costs-The Company expenses research and
development costs as incurred.
Foreign Exchange Contracts-The Company periodically enters into foreign
exchange contracts to hedge financial statement amounts denominated in foreign
currencies. Gains and losses related to contracts which hedge future revenues
are included in net sales. Gains and losses on contracts which hedge against
certain payables denominated in foreign currencies offset the foreign currency
transaction gains or losses on those payables. Gains and losses arising from
foreign exchange contracts which are designated as, and are effective as,
economic hedges of the Company's net foreign investments are reported as
translation adjustments. In the first quarter of 1993, $7.5 million of losses
were recorded as translation adjustments. In the fourth quarter of 1992, $5.7
million of such losses were recorded as translation adjustments.
Per Share Data-Per share data are calculated using the weighted average
number of shares of capital stock and dilutive capital stock equivalents (stock
options and warrants) outstanding during each year. The weighted average number
of shares used to compute earnings per share was 33,073,000, 33,593,000 and
33,163,000 in 1993,1992 and 1991, respectively. Net income per share is
equivalent to fully diluted earnings per share.
3. Income Taxes-The income tax provision (benefit) consisted of the
following (000s omitted):
1993 1992 1991
Current:
U.S. Federal $ -- $ -- $ --
Non-U.S. and other 500 (2,200) (4,700)
Subtotal 500 (2,200) (4,700)
Deferred:
U.S. Federal
Non-U.S. and other -- -- (100)
Subtotal -- -- (100)
Total $ 500 $(2,200) $(4,800)
Non-U.S. earnings (losses) before income taxes amounted to $(337) million, $44
million and $70 million in fiscal 1993, 1992 and 1991, respectively.
The Company and its subsidiaries are engaged in business in countries with
statutory rates ranging from zero to approximately 60%. As a result, the
Company's effective tax rate may vary year to year depending upon the operating
results of individual subsidiaries. In fiscal 1993, 1992 and 1991, exclusive of
the adjustments described below, the Company's effective tax rate was zero,
zero and 6%, respectively, due to operating losses in certain countries with
high tax rates (without currently recoverable tax benefits) and income in
countries with low or zero statutory rates.
Certain of the Company's non-U.S. subsidiaries are undergoing audits by
their respective tax authorities for various fiscal years. In fiscal 1992, the
Company resolved tax disputes in the U.S. for the fiscal years 1981 through
1986 and in Italy for the fiscal years 1982 through 1984. In October 1993 the
Company received a favorable ruling in the Japanese tax case. The total refund
is $20 million plus interest.
In the fourth quarters of fiscal 1992 and 1991, after consultation with tax
counsel concerning the likely outcome of certain tax audits and litigation, the
Company reduced by $3 million and $8 million, respectively, income tax accruals
no longer considered necessary to meet the probable liabilities in those
proceedings.
As of 30 June 1993, the Company's U.S. subsidiaries have net operating loss
carryforwards of approximately $140 million. Certain of the Company's non-U.S.
subsidiaries have net operating loss carryforwards of approximately $100
million, which expire at various dates through 2002.
As of 30 June 1993, the Company's deferred tax assets consisted primarily
of its net operating loss carryforwards, accrued restructuring costs, inventory
reserves and allowance for doubtful accounts receivable. Management has
assigned a valuation allowance to offset fully the future tax benefits of these
deferred tax assets.
4. Short-term Debt-As of 30 June 1993, short-term debt included $50.1
million from various banks in 18 countries and $7.5 million from a company
controlled by the chairman of Commodore. Several of the banks have demanded
repayment and in most cases the Company has reached temporary resolutions to
any legal action in order to allow time to develop a restructuring plan. The
bank loans are no collateralized. As of 30 June 1993, there were no unused
short-term lines of credit available.
For short-term bank borrowings of $50.1 million at 30 June 1993, the
average interest rate was 6.6% (1992-8.6%
1991 - 11.2%). The maximum month-end short-term borrowings during fiscal 1993
were $67.2 million (1992 - $67.8 million
1991 - $26.6 million). The average month-end short-term borrowings outstanding
during fiscal 1993 were $60.3 million (1992 - $28.5 million
1991 - $17.4 million) at a weighted average interest rate of 7.7% (1992 - 9.8%
1991 - 12.7%).
In order to obtain needed working capital, Transpacific Company Limited
(TPC), a company controlled by the chairman of Commodore, loaned the Company
$17.0 million in February and April 1993. An agreement was made to sell $9.5
million of inventory in satisfaction of a portion of the debt. The proceeds of
these sales were temporarily retained by the Company but subsequently repaid to
TPC. As of 30 June 1993, the $9.5 million obligation to TPC has been recorded
as an accrued for financial accounting purposes. The remaining amount of $7.5
million is presented by a collateralized demand loan and the has been
classified as short-term debt as of 30 June 1993.
(000s omitted) 30 June 30 June
1993 1992
Notes, 11.0% due March 1993 $ -- $ 5,000
Notes, 10.75% due through March 1995 25,000 37,500
Notes, 12.0% due through March 1994 8,000 16,000
Real estate mortgages, 7.25% to 17.0%, due
through 2006 16,400 5,800
Collateralized equipment loans, 7.5% to
9.6%, due through 2001 16,400 15,800
Capitalized lease obligations averaging
12.4% due through 2019 9,100 9,700
74,500 89,800
Current Portion (56,400) (29,500)
$ 18,100 $ 60,300
In May 1987, the Company issued $60 million of senior and subordinated notes
with warrants to purchase 2,250,000 shares of capital stock to an insurance
company. The warrants are exercisable at $11.40 per share until March 1994. The
Company repurchased 750,000 warrants in March 1989 for $4.5 million and an
additional 750,000 warrants in April 1991 for $4.5 million. In March 1993 the
unpaid balance of $8 million of subordinated notes were retired in exchange for
a similar amount of senior notes. In August 1988, the Company issued an
additional $50 million of senior notes to two insurance companies. The notes
are uncollateralized.
As of 30 June 1993 the Company was in default under the provisions of the
notes. The note agreements contain various covenants which, among others,
provide for the maintenance of a minimum level of net worth and contain
restrictions on dividends. For financial statement purposes the entire amount
of debt has been reclassified as current. The Company is engaged in
negotiations with the lenders to restructure the debt, although there can be no
assurance an agreement will be reached.
As of 1 November 1993, the Company received a waiver of non-compliance with
the provisions of the note agreements through 31 January 1994. The waiver
provides that the exercise price of the 750,000 warrants is reduced from $11.40
per share to $3.50 per share and the exercise period is extended from March
1994 to March 1996. In addition, the exercise price is further reduced to $.50
per share if the interest payments due on 1 January 1994 are not made in full.
As of 30 June 1993 the Company was in default under a real estate mortgage
for $5.7 million. The bank commenced legal action which has been suspended
based on mutually agreed payment terms. For financial statement purposes the
entire amount of the mortgage has been classified as current.
As of 30 June 1993 the Company was in default under an equipment loan for
$13.0 million. The Company intends to sell the equipment in the near future and
retire the debt. For financial statement purposes the entire amount of the
equipment loan has been classified as current.
It is not practicable to estimate the fair value of the debt.
Approximate annual maturities of long-term debt as of 30 June 1993 are as
follows (000s omitted):
1994 $56,400
1995 1,700
1996 300
1997 200
1998 7,500
Later years 8,400
$ 74,500
6. Capital Stock-As of 30 June 1993 the following shares of capital stock were
reserved for future issuance:
Stock Incentive Plan 3,930,063
Warrants 750,000
The Stock Incentive Plan for Key Employees provides for certain key employees
to receive grants or options to purchase up to 6,000,000 shares of the
Company's capital stock. Although the Plan allows for non-qualified stock
options to be granted at a price below the market value, all options have been
granted at the fair market value at the date of grant except for options for
300,000 shares, granted to an officer at a price of $7.25, which was below the
fair market value at the date of the grant. Options granted under the Plan
expire ten years from the date of the grant and outstanding options granted
before 1 January 1989 are exercisable in annual increments of 33 1/3% beginning
one year from the date of grant. Options granted after 31 December 1988 but
before 1 June 1993 are exercisable in annual increments of 25% beginning one
year from the date of the grant. Of the options granted after 1 June 1993, 14%,
43% and 43% are exercisable on 2 June 1993, 1 January 1994 and 1 January 1995,
respectively. As of 30 June 1993 options were held by 59 employees and range in
exercise price from $2.75 to $13.25. These options expire on various dates from
May 1996 to June 2003. Options for 634,000 shares were exercisable as of 30
June 1993. Option activity during 1992 and 1993 was as follows:
Number of Average Price
Shares Per Share
Outstanding as of 30 June 1991 1,591,432 $ 6.98
Granted 273,000 12.75
Exercised (365,000) 6.43
Cancelled (231,341) 7.72
Outstanding as of 30 June 1992 1,268,091 $ 8.25
Granted 2,232,500 2.96
Exercised (49,000) 5.94
Cancelled (973,834) 8.38
Outstanding as of 30 June 1993 2,477,757 $ 3.48
When options are exercised, the proceeds, including any applicable income tax
benefits, are credited to capital stock and contributed surplus.
In fiscal 1990 a total of 650,000 shares of restricted capital stock were
granted to two officers at a price of $6,500 or $0.01 per share. In fiscal
1991, 120,000 shares were granted to an officer at a price of $1,200 or $0.01
per share. As of 30 June 1993, 140,000 shares are restricted. The difference
between the grant price and the fair market value at the date of the grants has
been recorded as unearned compensation in the consolidated balance sheets and
has been completely amortized to earnings by 30 June 1993.
7. Leases
The Company leases certain machinery and equipment, manufacturing
facilities, warehouses and administrative offices with terms expiring at
various dates to 2020. Typically, the Company pays property taxes, insurance
and maintenance expenses related to the leased property. The gross cost of
property included under capital leases as of 30 June 193 and 1992 was $9.8
million and $10.4 million, respectively. The related accumulated amortization
as of 30 June 1993 and 1992 was $2.8 million and $3.1 million, respectively.
Amortization expense of property under capital leases was $.4 million in 1993,
$.7 million in 1992 and $.5 million in 1991. Total rental expense under
operating leases was $9.7 million in 1993, $8.8 million in 1992 and $8.2
million in 1991.
Operating lease commitments exclude leases with a total obligation of $21.2
million which the Company plans to terminate as part of the restructuring plan.
Minimum future obligations under leases as of 30 June 1993 are as follows (000s
omitted):
Capital Operating
Leases Leases
1994 $ 1,500 $ 3,700
1995 1,400 2,800
1996 1,200 2,100
1997 1,100 1,800
1998 1,100 1,400
Later Years 24,100 9,600
Total minimum obligations $ 30,400 $ 21,400
Amounts representing interest (21,300) --
Present value of net minimum
obligations $ 9,100 --
8. Geographic Segment Information
North Asia/
(In Thousands of Dollars) America Europe Australia
1993
Sales to unaffiliated customers $ 63,400 $ 495,100 $ 32,300
Intersegment sales 31,200 242,000 480,900
Net sales 94,600 737,100 513,200
Income (loss) from operations (42,800) (304,700) (5,800)
Interest expense, net
Other income, net
(Loss) before income taxes
Identifiable assets 64,300 138,100 65,700
Depreciation expense 6,100 4,800 4,800
Capital expenditures 2,300 11,800 6,200
1992
Sales to unaffiliated customers $ 76,900 $ 798,500 $ 35,600
Intersegment sales 64,800 294,200 586,400
Net sales 141,700 1,092,700 622,000
Income (loss) from operations (6,100) 31,400 (100)
Interest expense, net
Other income, net
Income before income taxes
Identifiable assets 103,300 451,800 98,100
Depreciation expense 7,800 6,600 3,300
Capital expenditures 5,900 5,900 13,300
1991
Sales to unaffiliated customers $ 110,100 $ 883,100 $ 54,000
Intersegment sales 82,700 454,800 711,100
Net sales 192,800 1,337,900 765,100
Income (loss) from operations (24,700) 74,400 (800)
Interest expense, net
Other expense, net
Income before income taxes
Identifiable assets 137,000 414,400 87,100
Depreciation expense 7,600 6,600 3,400
Capital expenditures 16,900 8,600 2,400
(In Thousands of Dollars) Eliminations Consolidated
1993
Sales to unaffiliated customers $ -- $ 590,800
Intersegment sales (754,100) --
Net sales (754,100) 590,800
Income (loss) from operations 18,700 (334,600)
Interest expense, net (17,800)
Other income, net (3,600)
(Loss) before income taxes (356,000)
Identifiable assets (2,300) 265,800
Depreciation expense -- 15,700
Capital expenditures -- 20,300
1992
Sales to unaffiliated customers -- $ 911,000
Intersegment sales (945,400) --
Net sales (945,400) 911,000
Income (loss) from operations 6,100 31,300
Interest expense, net (14,700)
Other income, net 8,800
Income before income taxes 25,400
Identifiable assets
(6,100) 647,100
Depreciation expense -- 17,700
Capital expenditures -- 25,100
1991
Sales to unaffiliated customers -- $ 1,047,200
Intersegment sales (1,248,600) --
Net sales (1,248,600) 1,047,200
Income (loss) from operations 24,500 73,400
Interest expense, net (15,400)
Other expense, net (5,400)
Income before income taxes 52,600
Identifiable assets (12,100) 626,400
Depreciation expense -- 17,600
Capital expenditures -- 27,900
9. Commitments and Contingencies
In fiscal 1993 the Company completed an investigation and feasibility study
regarding ground water contamination at its semiconductor manufacturing
facility in Pennsylvania. As a result of the study the Company and a previous
owner were ordered by the United States Environmental Protection Agency (EPA)
to remedy the contamination. The previous owner of the facility has agreed to
undertake the cleanup of the site. Settlement discussions have taken place with
the previous owner and an insurer to relieve Commodore from future costs
related to the cleanup. Management anticipates that the settlement discussions
will be concluded favorably.
The Company is a party to various claims and litigation matters incidental
to the normal course of business, including certain collections actions by
creditors. Although it is impossible to predict the results of specific
matters, management believes that the aggregate liability, if any, for all
lawsuits to which the Company is a party, in excess of insurance coverage and
financial statement provisions, will not have a material adverse effect on the
Company's operations or financial position.
10. Legal Settlement-During the third quarter of fiscal 1991, the Company
under a court order, settled a lawsuit brought by its former president. The
suit arose from facts surrounding the former president's employment. As a
result of the unfavorable outcome the Company paid $9.2 million which has been
classified as an extraordinary charge in the accompanying consolidated
statement of operations.
(000's omitted, except per share
amounts)
For the Year Ended 30 June 1993 First Second Third
Net sales $ 158,600 $ 237,700 $ 120,900
Gross profit (loss)(a) 25,200 (16,700) (111,300)
Income (loss) before income taxes (18,600) (76,700) (177,600)
Income tax provision 200 500 --
Net income (loss) (18,800) (77,200) (177,600)
Net income (loss) per share $ (0.57) $ (2.33) $ (5.37)
For the Year Ended 30 June 1992
Net sales $ 204,100 $ 371,600 $ 194,600
Gross profit 57,100 120,600 54,300
Income (loss) before income taxes 5,800 42,200 4,300
Income tax provision (benefit) 500 2,100 200
Net income (loss) $ 5,300 $ 40,100 $ 4,100
Net income (loss) per share $ 0.16 $ 1.18 $ 0.12
For the Year Ended 30 June 1993 Fourth Year
Net sales $ 73,600 $ 590,800
Gross profit (loss)(a) (29,300) (132,100)
Income (loss) before income taxes (83,100) (356,000)
Income tax provision (200) 500
Net income (loss) (82,900) (356,500)
Net income (loss) per share $ (2.51) $ (10.78)
For the Year Ended 30 June 1992
Net sales $ 140,700 $ 911,000
Gross profit 14,300 246,300
Income (loss) before income taxes (26,900) 25,400
Income tax provision (benefit) (5,000)(b) (2,200)
Net income (loss) $ (21,900) $ 27,600
Net income (loss) per share $ (0.66) $ 0.82(c)
(a) Certain amounts have been reclassified to conform with the presentation or
the fiscal year.
(b) Reflects reduction of certain income tax accruals. See Note 3.
(c) Total for year differs from sum of quarters due to fluctuations in the
stock price affecting quarterly common stock equivalents.
/*/*/*/*/*/*/*/*/*/*/*/*/*/
DISCLOSURE II
/*/*/*/*/*/*/*/*/*/*/*/*/*/
COMMODORE INTERNATIONAL LTD
Ownership Summary
GOULD, IRVING, 20% (PRX 12-30-93)
***
TYPE DATE(Q,M) OWNERS CHANGE (000S) HELD %OWN
INVEST. COS. 12/31/93(Q) 0 0 0.00
INSTITUTIONS 12/31/93(Q) 15 -452 645 1.95
5% OWNERS 03/31/94(M) 1 NA 6,595 19.96
INSIDERS 02/29/94(M) 4 NA 310 0.93
Subsidiaries:
No subsidiaries reported.
COMMODORE INTERNATIONAL LTD
Ownership Detail
5% Owners:
Shares SEC Filing
Owner Name Location Held Form Date
------------------------------ ---------------- ----------- ---- ----------
GOULD IRVING CANADA 6,595,338 13G 12/31/1989
-----------
Totals for 1 owners: 6,595,338
Insider Owners (SEC Forms 3 and 4):
Shares Change Filing
Rank Owner Name Rel Held in Shares Date
---- ------------------------------ --- ----------- ----------- ----------
1 ALI MEDHI P 300,000 -100,982 4/30/1991
2 SPIERS DAVID R AF 6,334 000 3/31/1989
3 WEYMAN BRIAN C VP 3,000 3,000 11/30/1989
4 SELIGMAN RALPH D D 1,000 600 10/31/1991
----------- -----------
Totals for 4 owners: 310,334 -97,382
Institutional Owners (SEC Form 13-F):
Shares Change Filing
Rank Owner Name Held in Shares Date
---- ------------------------------ ----------- ----------- ----------
1 QUEST ADVISORY CO 354,100 -19,800 12/31/1993
2 COLLEGE RETIRE EQUITIES 110,000 -78,900 12/31/1993
3 AMERICAN NATL B&T/CHICAG 49,500 -500 12/31/1993
4 MELLON BANK CORPORATION 36,500 000 12/31/1993
5 COMERICA INC 31,800 31,800 12/31/1993
6 UNITED STATES TRUST/N Y 26,965 000 9/30/1993
7 U S BANCORP 18,000 -10,000 9/30/1993
8 NATL WESTMINSTER BK PLC 10,000 -7,500 12/31/1993
9 SMITH BARNEY SHEARSON 6,000 2,600 12/31/1993
10 PAINEWEBBER INC. 5,300 800 12/31/1993
11 BANC ONE CORPORATION 4,150 3,150 9/30/1993
12 BANKERS TRUST N Y CORP 4,100 4,100 12/31/1993
13 BOATMEN'S BANCSHARES INC 2,000 000 12/31/1993
14 MERRILL LYNCH & CO INC 1,150 1,150 12/31/1993
15 CALIF PUBLIC EMP. RET. 300 -152,512 12/31/1993
16 MACKENZIE FINANCIAL CORP 000 -152,500 12/31/1993
16 MERRILL LYNCH PIERCE F&S 000 -1,500 12/31/1993
16 OPPENHEIMER MGMT. CORP. 000 -55,000 12/31/1993
16 WELLS FARGO INST. TR NA 000 -12,500 12/31/1993
----------- -----------
Totals for 15 owners: 659,865 -447,112
Market value (in $millions): 2 as of 31-Dec-93
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| B r u c e M. F r a n k l i n |
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