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ACME UNITED CORPORATION
1995 ANNUAL REPORT AND FORM 10-K
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Acme United Corporation
TO OUR SHAREHOLDERS:
Acme United had a difficult year in 1995. Actions are under way to address the
problems. One small but significant change is the Annual Report, which has
been combined with the Form 10-K in a new format to save money. Numerous other
measures have been initiated that, when accomplished, should enable the
Company to recover and be in a solid position for future growth and
profitability. This letter will explain the actions being taken and the
benefits we expect to attain in 1997 and thereafter.
The Company reported a net loss of $8,716,176, or $2.61 per share for 1995.
This compares to net income of $123,498, or four cents per share, for 1994. A
charge of $6,701,000 was taken to cover the costs of restructuring
($3,136,000) and asset revaluations ($3,565,000). Fourth quarter earnings were
also adversely affected by charges aggregating $1,045,000 for manufacturing
variances as we reduced inventory, increased pension costs and other charges.
An important part of the strategy is a company-wide inventory reduction plan
which will produce funds for investment in the Company. Inventories were
written down by $3,381,000 to make possible a conversion to cash within a
reasonable period. We expect to recover $2.8 million from this program by the
end of 1996.
To contribute further to improved profitability, management has initiated a
cost reduction program which includes reductions in salary expense, revisions
in employee benefit plans, and a reduction in general and administrative
expenses. These measures are forecast to produce savings in excess of
$1 million over the first full year they are in place. Some of the savings
will be channeled into new sales and marketing programs for both the medical
and consumer products divisions.
It is an encouraging fact that Acme United's business is growing in key
segments, and the goal is to expand and improve in the targeted markets. The
following three sections describe actions taken and strategies being
implemented in our divisions.
NORTH AMERICAN CONSUMER PRODUCTS
The consumer products business achieved $22.7 million in sales in 1995, an
increase of three percent over the previous year. This growth resulted from
increases in stainless steel scissors for the crafts market; the Kingshead
line of children's scissor products; rulers and related items in the Westcott
product line; and first aid kits for offices and factories. Despite the modest
sales growth for 1995, the division's profit performance was adversely
affected by excess capacity.
A major component of the overall profit improvement plan is the transfer of
the Company's scissor and ruler manufacturing operation from Bridgeport,
Connecticut to Fremont, North Carolina. The decision to stop manufacturing
product in Bridgeport was very difficult, but necessary. The physical move is
expected to be completed after mid-year, with full production commencing in
the final quarter of 1996. While the Company expects operating efficiency in
Fremont to steadily improve as a result of the consolidation, projected annual
savings of approximately $700,000 will not materialize until 1997. We
anticipate moving, installation and training costs in 1996 which are not
expected to reoccur in the future.
For the division in 1996, we plan to continue efforts to strengthen
distribution of the stationery line to the office products superstores;
develop new products for the children's scissor and craft markets; and obtain
a larger share of the back-to-school market. The goal is to obtain a small
increase in sales in 1996, with much larger increases in future years.
The Company's Canadian subsidiary, Acme United Limited also had high inventory
levels which we will reduce through aggressive pricing. The overall efficiency
of our operation there also must be strengthened. We expect to attain
improvements in asset utilization and profitability in 1996.
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U.S. MEDICAL PRODUCTS
Sales in 1995 of the Company's medical products business were flat at $16.3
million. In the third quarter, the Bubble and Board line of intravenous
therapy products, valued at more than $200,000, was written off which
contributed to the poor performance. Other asset revaluations in the fourth
quarter aggregated $1,216,000. For 1996, modest sales growth is forecast. We
will continue to focus on the hospital and alternate care markets, and have
opportunities with hospital buying groups that we are working hard to develop.
Further reductions in overhead will also be undertaken in an ongoing effort to
decrease costs. The division plans to continue to decrease inventory and
improve manufacturing efficiency at the Goldsboro, North Carolina plant.
EUROPEAN OPERATIONS
The performance of our European operations in 1995 was poor. In 1996, we plan
to make reductions in expenses at the Altenbach cutlery and Schlemper scissor
companies in Germany, and at Acme United, Ltd. in England. Simultaneously,
increases in sales and marketing efforts are planned to generate revenue
growth.
We reserved $2.1 million in 1995 for changes in our German operations, and
$1.0 million for inventory revaluations in Europe. We also wrote off $221,000
in England for an outdated manufacturing facility.
A realistic goal for Europe is to decrease the loss we suffered in 1995. In
1996 we will continue to work towards improving performance and cutting costs,
while pursuing various options for restructuring.
MANAGEMENT AND BOARD CHANGES
In November 1995, the Board of Directors elected me President and Chief
Executive Officer of Acme United Corporation. I had been with the Company
since January when I was appointed Executive Vice President, and joined the
Board of Directors in April.
Gary D. Penisten was elected Chairman of the Board in February 1996. He has
been working closely with me in developing the restructuring plan. Gary was
formerly Chief Financial Officer of Sterling Drug Inc. and a member of its
Board of Directors.
Also, Dwight C. Wheeler II has been elected to the position of Vice Chairman.
For the past year he had served as President and Chief Executive Officer,
succeeding his father, Henry C. Wheeler, who retired on November 30, 1995 as
Chairman. Henry Wheeler will continue to provide counsel to the Board as
Honorary Chairman Emeritus.
SUMMARY
In 1996 a series of strategies designed to position the Company for
profitability and long-term growth are being implemented. The highlights are a
company-wide inventory to cash plan; moving the Bridgeport plant to Fremont to
consolidate manufacturing operations; modifications in employee benefits and
trimming administrative expenses; eliminating selected manufacturing
operations in Europe to lower costs; and increased emphasis on marketing and
sales.
To conclude, your Board and management have made some hard decisions which are
intended to effect a turnaround for the Company. The business shows promise
and progress and we have confidence in the future. I anticipate Acme United
will be quite a different company when the President's letter is prepared for
the 1996 Annual Report. If we stay the course with the plans we have set, I am
confident that it will be a better one.
Sincerely,
/s/ Walter C. Johnsen
Walter C. Johnsen,
President, Chief Executive Officer and Chief Financial Officer
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
(X) ANNUAL REPORT PURSUANT TO SECTION 13
OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1995
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 0-4823
ACME UNITED CORPORATION
Exact name of registrant as specified in its charter
CONNECTICUT 06-0236700
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
75 Kings Highway Cutoff, 06430
Fairfield, Connecticut (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code: (203) 332-7330
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class which registered
$2.50 PAR VALUE COMMON STOCK AMERICAN STOCK EXCHANGE
Securities registered pursuant to Section 12 (g) of the Act: None
Indicate by check mark whether the registrant (l) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days. YES [x] NO [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. [X]
Registrant had 3,337,620 shares outstanding as of March 18, 1996 of its $2.50
par value Common Stock. The aggregate market value of the voting stock held by
non-affiliates of the registrant as of March 18, 1996 was approximately
$12,098,873.
Documents Incorporated By Reference
(1) Proxy Statement for the annual meeting scheduled for April 22, 1996
incorporated into 1995 10-K, Part III
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PART I
Item 1. Business
General
Acme United Corporation (together with its subsidiaries "the Company") was
organized as a partnership in l867 and incorporated in l882 under the laws of
the State of Connecticut. The Company operates two business segments, consumer
and medical. The Company's operations are in the following geographic areas:
the United States, Canada, England and Germany. Financial information
concerning sales, operating profit and identifiable assets by business segment
and geographic area appears in Note 9 of the consolidated financial
statements.
Consumer
The Company manufactures and distributes scissors, shears, rulers, knives and
first aid kits for school, office or home use. Acquisition of Emil Schlemper
GmbH and Co. KG of Solingen, Germany in January l990, Homeric, Ltd. of
Sheffield, England in July l990 and Peter Altenbach and Son GmbH of Solingen,
Germany in 1991 extended the Company's presence in Europe as a scissor and
shear manufacturer and introduced a knife line with the acquisition of Peter
Altenbach and Son GmbH. The Company is a major domestic manufacturer of
scissors and shears in the United States, England and Germany; rulers in the
United States; knives in Germany; and a distributor of scissors, shears and
other products in Canada. In addition to local manufacturing competition in
each country, foreign competition continues, primarily from China, Taiwan and
Korea. The Company imports scissors, shears, knives and other products to
supplement its manufactured products.
Independent manufacturer representatives are primarily used to represent its
line of consumer products with wholesale, contract and retail stationery
distributors, office supply super stores, school supply distributors, and mass
market retailers in the United States. Foreign operations use a combination of
independent commission agents and an internal sales force.
A seasonal surge in sales arises from about March through July which is
attributed to sales in the educational field primarily through school supply
distributors and mass market retailers. Unfilled backlog at year end was
$1,848,084 as compared to $1,575,444 in l994.
Medical
The Company entered the medical products field in l965, producing disposable
medical scissors and instruments for sale to other companies, which packaged
them for sale to hospitals. In l972, the Company's Medical Products Division
began marketing its own line of products, including ONE TIME(R) disposable
procedure trays, RESPOSABLE(R) stainless steel instruments, and ACU-DYNE(R)
povidone-iodine germicide packaged in bottles and flexible packages. New
products have been added to the procedure tray line every year to meet the
specialized needs of hospitals, clinics and convalescent homes.
In l978, wound dressings were introduced by the Company which today include
ACU-DERM(R) a sterile, non-absorbent, self-adhering polyurethane dressing and
the LYO FOAM(R) line, a sterile absorbent polyurethane dressing. Bandage
products were added in January l992 when the Company acquired the major
portion of the U.S. medical products business of SePro Healthcare, Inc., the
U.S. subsidiary of the Seton Healthcare Group, plc of Oldham, England. The
Company entered into distribution agreements with Seton Healthcare
International Limited for exclusive U.S. rights to an extensive line of state-
of-the-art pressure therapy bandages and specialized wound dressings.
In l993, the Royl-Derm line of skin care and wound-care products was launched.
The Royl-Derm line of patent-pending skin-care and wound-care products have
been known to relieve or eliminate the pain connected with skin burns, wounds,
ulcers and blemishes often experienced by elderly and bed-ridden patients.
However, simultaneous launching of several competitive brands resulted in
widespread price cutting and saturation sampling, delaying the acceptance of
the Royl-Derm line. As a result, the Company incurred a $4l5,000 charge in
l994 for dated inventory of these products. The Company is continuing to
market the Royl-Derm line. However, 1995 sales were low and future sales are
not expected to be significant.
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In October, l992, Acme United acquired the exclusive marketing and
distribution rights in the U.S. for the OPCO Line of I.V. therapy products for
hospitals and the after-care market. The principal product is the patented
I.V. Bubble -- a plastic, see-through, disposable device which can be inflated
to protect the I.V. catheter and tubing while preventing the patient from
accidentally pulling out the catheter. A second OPCO product is the I.V.
Board, a reusable device which immobilizes the limb, stabilizes the I.V. site
and reduces premature I.V. restarts in active patients. Unsuccessful attempts
to market the OPCO line resulted in a $264,000 charge in 1995 for the
remaining inventory and licensing rights.
The Company has a network of medical dealers who distribute its line of
medical products with hospitals and the after hospital market which include
homes, nursing facilities and other alternate care providers. Technical
assistance is provided by its own field sales force.
Larger hospital buying groups, whose members account for 70% of the spending
on supplies by its member hospitals, have fostered increased competition among
suppliers. In December l994, the Company engaged MedAlliance, a highly
experienced sales group, to assist in contract sales of its medical products
to the key decision-makers in the major buying groups. Lower pricing and
profit margins are expected on sales to larger hospital buying groups.
Unfilled order backlog for the medical segment at year end was $203,765,
compared to $327,270 in l994.
Environmental Rules and Regulations - Environmental rules and regulations
regarding hazardous waste control and electroplating effluent have been
complied with and no major financial impact is expected to result from current
and future compliance with these rules and regulations.
Employment - As of year end, the Company employed 486 person, all but a few of
whom are full time and none are covered by union contracts. Employee relations
are considered good and no foreseeable problems with the work force are
evident. The employment level will decrease during 1996 to approximately 425
as a result of the restructuring plan.
Item 2. Properties
Acme United Corporation is headquartered at 75 Kings Highway Cutoff,
Fairfield, Connecticut in 15,403 square feet of leased space. The Company has
owned and leased manufacturing facilities in the United States, England,
Germany and 29,000 square feet of leased warehousing space in Canada. All
facilities are part of the consumer segment except for the 60,000 square foot
plant leased in Goldsboro, North Carolina which manufactures products for the
medical segment.
At the start of 1995, manufacturing for the U.S. consumer segment occurred in
three plants. However, they will be consolidated into the 58,000 square foot
owned Fremont, North Carolina plant by October 1996. The Seneca Falls, New
York ruler manufacturing plant was closed in 1995 and is now available for
sale. Manufacturing at the Bridgeport, Connecticut plant will end by July 1996
leaving vacant all but about 50,000 square feet for packaging, warehousing and
plant administration. Alternatives are being evaluated regarding the vacant
space.
Manufacturing for the European consumer segment is presently being conducted
at the 48,000 square foot owned Solingen, Germany plant and the 51,000 and
50,000 square foot leased plants in Solingen, Germany and Sheffield, England,
respectively. Part of the restructuring plan adopted in 1995 is to consolidate
operations in Germany into the owned plant in Solingen, Germany, which would
eliminate the need for the leased facility in Solingen, Germany. The lease
expires October, 2001.
Management believes that the Company's facilities, whether leased or owned,
are adequate to meet its current needs and should continue to be adequate for
the foreseeable future.
Properties owned by The Company in Fremont, North Carolina and Solingen,
Germany are collateralized by notes and mortgages. The leased facilities are
occupied under leases for terms ranging from five to ten years.
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Item 3. Legal Proceedings
The Company has been named as a defendant in various lawsuits arising in the
ordinary course of business. Management believes that the ultimate resolution
of such litigation will not have a material adverse impact on the Company's
results of operations, financial position or cash flows.
Item 4. Submission of Matters to a Vote of Security Holders
There were no matters submitted to a vote of the security holders of the
Company through the solicitation of proxies or otherwise during the fourth
quarter of the fiscal year ended December 31, 1995.
PART II
Item 5. Market for the Registrant's Common Stock and Related Security
Holder Matters
The Company's Common Stock is traded on the American Stock Exchange under the
symbol "ACU". The following table sets forth the high and low sale prices on
the American Stock Exchange for the Common Stock for the periods indicated:
Fiscal Year Ended December 31, 1994 High Low
First Quarter 4 1/4 3 1/4
Second Quarter 3 3/4 3 1/8
Third Quarter 3 7/8 3 1/4
Fourth Quarter 3 7/8 2 13/16
Fiscal Year Ended December 31, 1995
First Quarter 4 1/4 3 1/4
Second Quarter 4 3 5/16
Third Quarter 3 3/4 3 3/8
Fourth Quarter 4 2 13/16
As of March 4, 1996 there were approximately 1,700 holders of record of the
Company's Common Stock.
The Company has not paid cash dividends on its Common Stock in 1995 and 1994.
The Company presently intends to retain earnings to finance business
improvements. However, management and the Board of Directors believe it is
important for the Company to pay dividends when a record of consistent
earnings has been achieved.
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Item 6. Selected Financial Data
FIVE YEAR SUMMARY OF SELECTED FINANCIAL DATA
(All figures in thousands except per share data)
1995 1994 1993 1992 1991
________________________________________________________________________________________________
Net Sales $52,222 $52,755 $52,339 $53,037 $47,836
________________________________________________________________________________________________
Other Income 180 235 78 265 560
________________________________________________________________________________________________
Total 52,402 52,990 52,417 53,302 48,396
________________________________________________________________________________________________
Cost and Expenses: Cost of Goods Sold 38,801 37,795 38,729 38,829 33,869
________________________________________________________________________________________________
Inventory Valuation Losses 3,381 - - - -
________________________________________________________________________________________________
Selling, General and Administrative Expenses 14,397 13,324 13,130 13,092 10,763
________________________________________________________________________________________________
Restructuring & Other Charges 3,136 - - 468 -
________________________________________________________________________________________________
Interest Expense 1,953 1,658 1,554 1,716 1,226
________________________________________________________________________________________________
Income/(Loss) before Income Tax (9,266) 212 (995) (803) 2,538
________________________________________________________________________________________________
Provision (Benefit) for Income Tax (550) 89 (398) (256) 1,204
________________________________________________________________________________________________
Net Income/(Loss) (8,716) 123 (597) (547) 1,334
________________________________________________________________________________________________
Average Number of Shares Outstanding 3,338 3,338 3,338 3,325 3,273
________________________________________________________________________________________________
Net Income/(Loss) per Common Share $ (2.61) $ .04 $ (.18) $ (.16) $ .41
________________________________________________________________________________________________
Cash Divided per Common Share $ - $ - $ .05 $ .20 $ .17
________________________________________________________________________________________________
Book Value per Common Share $ 2.85 $ 5.42 $ 5.39 $ 5.70 $ 6.30
________________________________________________________________________________________________
Total Assets $37,020 $42,888 $41,963 $43,697 $41,066
________________________________________________________________________________________________
Total Long Term Debt $14,880 $14,388 $14,718 $36,182 $11,784
________________________________________________________________________________________________
Total Stockholder's Equity $39,505 $18,083 $17,999 $19,009 $20,608
________________________________________________________________________________________________
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Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
The Acme United Corporation ("the Company") operates its business in two
principal business segments, consumer and medical. Note 9 to the consolidated
financial statements gives details of the Company's business segments. The
medical segment operates in the United States and the consumer segment
operates in the United States, Canada, England and Germany.
Consolidated net sales were $52.2, $52.8 and $52.3 million in 1995, 1994 and
1993, respectively. The consumer segment accounted for 69%, 68% and 67% of
those sales in each respective year, and sales were almost equal for the U.S.
operations and foreign operations for the last three years. Medical segment
sales comprised approximately one third of consolidated net sales in 1995,
1994 and 1993.
Results of Operations 1995 Compared with 1994
Consolidated net sales were $52.2 million and decreased $533,000 or 1% from
1994. The consumer segment net sales decreased $133,000 or less than 1% and
the medical segment net sales decreased $400,000 or 2%.
Consumer segment sales in the U.S. operations increased $667,000 and foreign
operations decreased $800,000. The U.S. consumer segment increase is mainly
attributable to increased volume resulting from the growth of the first aid
kit line, Westcott ruler line and imported stainless steel scissors and
shears. Sales of lower priced scissors and shears declined which was
attributed to foreign competition. The Company expects to reverse the decline
with a more aggressive pricing policy in 1996. The foreign consumer segment
sales decrease resulted from volume declines in the European operations
despite the favorable impact of higher translation rates of approximately
$1,359,000.
Medical segment sales declined $400,000 primarily due to a decline in sales of
wound care products which have been unfavorably impacted by government
reimbursement policies.
Gross margins before inventory valuation losses declined in both the consumer
and medical segments; the consumer segment gross margins were 21% and 24% and
medical margins were 36% and 38% for 1995 and 1994, respectively. The decline
in the consumer segment resulted primarily from excess capacity and low margin
product sales mix in the foreign operations. Foreign operations sales were
$17.8 million and profit margins fell from 24% in 1994 to 18% in 1995. Margins
in the U.S. operations were 24% for both years. Medical segment margins
declined primarily as a result of a change in product sales mix.
Inventory valuation losses of $3,381,000 were recorded in 1995, primarily as a
result of an inventory reduction program implemented to generate cash in 1996.
Selling, general and administrative expenses were $14,397,000 in 1995 as
compared to $13,324,000 in 1994, an increase of $1,073,000 or 8%. The
increase occurred in U.S. operations and was primarily the result of increases
to U.S. pension expense of $537,000 and advertising promotion and catalog
allowances of $333,000. The significant rise in the pension expense reflects
the curtailment loss resulting from freezing the pension plan and a change in
the expected long term rate of return on long term assets from 10% to 8%.
Interest expense increased $295,000 or 18% over 1994 primarily because of
higher rates in the United States under the revolving line of credit.
The effective tax rate in 1995 was (6%) on a pre tax loss of $9,266,000 as
compared to 42% on pre tax income of $212,000. The Company reported a tax
benefit of only $550,000 because it was unable to fully utilize the 1995 pre
tax loss.
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Results of Operations 1994 Compared with 1993
Consolidated net sales were $52.8 million and increased $416,000 or 1% over
1993. The consumer segment net sales increased $818,000 or 2% and the medical
segment net sales decreased $402,000 or 2%.
Consumer segment sales for U.S. and foreign operations increased $399,000 and
$552,000, respectively. Higher sales of the first aid kit line and stainless
steel scissor and shear line were the major reason for the sales increase in
the United States. However, sales of lower priced scissors and shears
continued to decline as a result of continued foreign competition. A strong
volume increase in England was the major factor for increased sales from
foreign operations.
Despite a $781,000 or 17% sales increase to the alternate care market and a
13% growth of wound dressings and bandage products, medical sales declined as
a result of lower sales to the hospital dealer market, and to kit
manufacturers who use the Company's manufactured components.
Gross margins increased to 28% in 1994 from 26% in 1993 which was mainly due
to lower manufacturing costs and price increases in both the U.S. and foreign
consumer segment operations. The medical division gross profit margin was 38%
for both years despite a charge in 1994 to dispose of Royl-Derm inventory, a
line of skin care and wound care products.
Selling, general and administrative expenses were $13,324,000 in 1994 as
compared to $13,130,000 in 1993, an increase of $194,000 or 1%, and were 25%
of sales for both 1994 and 1993.
Interest expense increased $104,000 or 7% over 1993 primarily because of
increased rates in the United States under the revolving line of credit.
The effective tax rate in 1994 was 42% on pre tax income of $212,000 as
compared to (40%) on a pre tax loss of $995,000. The consolidated effective
tax rates vary year to year because the geographic components of income (loss)
before income taxes vary year to year and the statutory income tax rates vary
in countries where the Company has operations.
Liquidity and Capital Resources
Net cash flow from operating activities was $909,000 in 1995 as compared to
$712,000 and $2,710,000 in 1994 and 1993, respectively. Net cash provided by
operations and sale of real estate in 1995 was sufficient to finance capital
expenditures of $987,000 and reduce borrowings $282,000.
The Company's working capital, current ratio and long term debt to equity
ratio are as follows:
1995 1994
_________________________________________________________
Working Capital $15,976,000 $21,035,000
Current Ratio 2.42 to 1 3.23 to 1
Long Term Debt to Equity 1.57 .80
Working capital decreased $5,060,000 in 1995 resulting primarily from a
decrease in inventory caused by inventory valuation losses and the addition of
a restructuring reserve in current liabilities.
Long term debt to equity was adversely affected by an $8,578,000 reduction in
stockholders' equity which was primarily attributable to asset valuation and
restructuring charges.
The U.S. revolving line of credit, renegotiated in March 1996, is due to
expire in May 1998 and the foreign overdraft arrangements are due to expire at
various times in 1996. Based on maintaining the U.S. revolving line of credit
and foreign overdraft arrangements, current cash balances and cash flow from
operations which includes a program to convert high inventory levels to cash,
the Company believes it can meet capital expenditure, restructuring and other
planned financial commitments in 1996.
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Item 8. Financial Statements and Supplementary Data
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
For the years ended December 31, 1995, 1994 and 1993
1995 1994 1993
________________________________________________________________________________________________
Net Sales $ 52,222,210 $ 52,754,799 $ 52,339,323
Other Income 179,811 234,881 78,172
________________________________________________________________________________________________
52,402,021 52,989,680 52,417,495
Cost and Expenses
Cost of Goods Sold 38,800,804 37,795,384 38,728,738
Inventory Valuation Losses 3,381,355 - -
Selling, General and Administrative Expenses 14,396,927 13,324,022 13,129,703
Interest Expense 1,953,090 1,657,875 1,553,826
Restructuring & Other Charges 3,136,257 - -
________________________________________________________________________________________________
61,668,433 52,777,281 53,412,267
________________________________________________________________________________________________
Income/(Loss) before Income Tax (9,266,412) 212,399 (994,772)
Provision (Benefit) for Income Tax
United States (53,535) 39,127 (90,489)
Foreign (496,701) 49,774 (307,038)
________________________________________________________________________________________________
(550,236) 88,901 (397,527)
________________________________________________________________________________________________
Net Income/(Loss) $ (8,716,176) $ 123,498 $ (597,245)
________________________________________________________________________________________________
Net Income/(Loss) applicable to common stock(A) $ (2.61) $ .04 $ (.18)
________________________________________________________________________________________________
(A)Based on a weighted average number of shares outstanding during the year.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
For the years ended December 31, 1995, 1994 and 1993
Additional
Treasury Common Paid-In Translation Retained
Stock Stock Capital Adjustment Earnings
________________________________________________________________________________________________
Balances, December 31, 1992 $ (357,631) $ 8,461,550 $ 2,145,119 $ (854,211) $ 9,614,431
Net Loss (597,245)
Cash Dividends
Common Stock $.05 per share (166,881)
Translation Adjustment (245,689)
________________________________________________________________________________________________
Balances, December 31, 1993 (357,631) 8,461,550 2,145,119 (1,099,900) 8,850,305
Net Income 123,498
Translation Adjustment (40,341)
________________________________________________________________________________________________
Balances, December 31, 1994 (357,631) 8,461,550 2,145,119 (1,140,241) 8,973,803
Net Loss (8,716,176)
Translation Adjustment 138,429
________________________________________________________________________________________________
Balances, December 31, 1995 $ (357,631) $ 8,461,550 $ 2,145,119 $(1,001,812) $ 257,627
________________________________________________________________________________________________
See notes to financial statement
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Acme United Corporation and Subsidiaries
CONSOLIDATED BALANCE SHEETS
December 31, 1995 and 1994
Assets 1995 1994
_____________________________________________________________________________
Current Assets:
Cash and cash equivalents $ 531,773 $ 450,480
Accounts receivable, net 8,108,483 7,893,838
Inventory 18,013,251 20,999,538
Deferred tax asset - 356,874
Prepaid expenses and other current assets 605,773 747,758
_____________________________________________________________________________
Total current assets 27,259,280 30,448,488
Plant, property and equipment:
Land 490,589 756,625
Buildings 4,236,976 4,580,669
Machinery and equipment 15,736,435 16,063,066
_____________________________________________________________________________
Total plant, property and equipment 20,464,000 21,400,360
Less, accumulated depreciation 13,141,747 12,852,430
_____________________________________________________________________________
Net plant property and equipment 7,322,253 8,547,930
Goodwill 817,340 856,480
Other assets 1,621,784 3,035,525
_____________________________________________________________________________
Total Assets $ 37,020,657 $ 42,888,423
_____________________________________________________________________________
Liabilities 1995 1994
_____________________________________________________________________________
Current Liabilities:
Accounts payable $ 3,193,285 $ 2,473,125
Notes payable 3,650,116 4,000,069
Restructuring reserve 1,197,500 -
Other Accrued liabilities 3,242,758 2,941,146
_____________________________________________________________________________
Total current liabilities 11,283,659 9,414,340
Deferred Income Taxes - 1,003,893
Restructuring Reserve 1,352,000 -
Long Term Debt 14,880,145 14,387,590
_____________________________________________________________________________
Total Liabilities $ 27,515,804 $ 24,805,823
Commitments and Contingencies (Note 8)
STOCKHOLDERS' EQUITY
Common stock, par value $2.50, authorized
4,000,000 shares, issued 3,384,620 and
outstanding 3,337,620 $ 8,461,550 $ 8,461,550
Treasury Stock, 47,000 shares at cost (357,631) (357,631)
Additional paid-in capital 2,145,119 2,145,119
Retained earnings 257,627 8,973,803
Translation adjustment (1,001,812) (1,140,241)
_____________________________________________________________________________
Total Stockholders' Equity 9,504,853 18,082,600
_____________________________________________________________________________
Total Liabilities and
Stockholders' Equity $ 37,020,657 $ 42,888,423
_____________________________________________________________________________
See notes to financial statements
11
13
Acme United Corporation and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOW
For the years ended December 31, 1995, 1994 and 1993
1995 1994 1993
________________________________________________________________________________________________
Cash flows from operating activities
Net income/(loss) $ (8,716,176) $ 123,498 $ (597,245)
Adjustments to reconcile net income/(loss) to
net cash provided by operating activities
Depreciation 1,312,521 1,307,035 1,279,884
Amortization 565,972 575,081 538,235
Increase/(decrease) in deferred income taxes (675,196) (17,984) 196,481
(Gain) on disposal of assets (19,241) (25,749) -
Restructuring & other charges 3,136,257 - -
Inventory valuation losses 3,381,355 - -
Change in assets and liabilities
(Increase)/decrease in accounts receivable 824,962 (92,347) (1,019,063)
(Increase)/decrease in inventory (38,468) (755,307) 1,825,986
(Increase)/decrease in prepaid expenses and
(other current assets 70,516 3,740 (415,843)
(Increase)/decrease in other assets 115,299 (83,049) (142,023)
Increase/(decrease) in accounts payable 636,883 (998,692) 861,813
Increase/(decrease) in income taxes payable 106,930 423,277 (279,663)
Increase in other liabilities 207,488 252,438 461,433
________________________________________________________________________________________________
Total adjustments 9,625,278 588,443 3,307,240
________________________________________________________________________________________________
Net cash provided by operations 909,102 711,941 2,709,995
________________________________________________________________________________________________
Cash flows from investing activities
Capital expenditures (986,647) (1,445,204) (1,158,897)
Licensing agreement - - (200,000)
Proceeds from sales of plant, property & equipment 453,616 135,650 131,468
________________________________________________________________________________________________
Net cash used for investing activities (533,031) (1,309,554) (1,227,429)
________________________________________________________________________________________________
Cash flows from financing activities
Net borrowings (282,440) 740,325 (1,863,644)
Dividends paid - - (166,881)
________________________________________________________________________________________________
Net cash (used for)/provided by financing activities (282,440) 740,325 (2,030,525)
________________________________________________________________________________________________
Effect of exchange rate changes on cash (12,338) (10,892) (28,429)
________________________________________________________________________________________________
Net change in cash and cash equivalents 81,293 131,820 (576,388)
Cash and cash equivalents at beginning of year 450,480 318,660 895,048
________________________________________________________________________________________________
Cash and cash equivalents at end of year $ 531,773 $ 450,480 $ 318,660
________________________________________________________________________________________________
See notes to financial statements
12
14
Acme United Corporation and Subsidiaries
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
a. Nature of Operations - Acme United Corporation is a multinational
corporation which operates in two business segments, consumer and
medical. The consumer segment operates in the United States, Canada,
England and Germany and the medical segment operates in the United
States. Principal consumer segment products are scissors, shears,
rulers, knives and first aid kits which are sold primarily to
wholesale, contract and retail stationery distributors, office supply
superstores, school supply distributors and mass market retailers.
Medical segment products are disposable scissors, instruments and
sterile procedure trays, germicidal products, pressure bandages and
wound dressings which are sold to hospital supply dealers and
alternate care market dealers. Medical sales account for
approximately one third of the Company's revenue and medical assets
account for about one fourth of the assets.
b. Management Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
c. Principles of Consolidation - The consolidated financial statements
include the accounts of the Company and Subsidiaries, all of which
are wholly owned. All significant intercompany transactions have been
eliminated in the preparation of the consolidated financial
statements.
d. Translation of Foreign Currency - The Company translates its assets
and liabilities at rates in effect at the end of the year. Revenues
and expenses are translated at average rates in effect during the
respective years. Translation adjustments are treated as a separate
component of stockholders' equity. Foreign currency transaction gains
and losses are recognized at the time of settlement of the underlying
purchase transactions and treated as purchasing variances.
e. Hedging Activity - The Company on occasion purchases foreign currency
contracts and/or options as hedges against foreign currency
fluctuation risk related to specific purchase commitments. The
Company does not engage in foreign exchange contracts for speculative
purposes and accordingly, the contracts are accounted for as hedges.
f. Cash Equivalents - Investments with an original maturity of three
months or less at the date of purchase are considered cash
equivalents.
g. Inventory Valuation - Inventories are stated at the lower of average
cost (first in, first out basis) or market.
h. Plant, Property and Equipment and Depreciation - All plant, property
and equipment is recorded at cost. The Company records depreciation
for financial reporting purposes using the straight-line method. The
estimated useful lives for most machinery, equipment and tooling
ranges from 3 to 15 years and for buildings from 15 to 40 years.
Maintenance and repairs or minor renewals are charged to operations
as incurred. Major renewals and betterments are capitalized. The
carrying amounts of assets sold or otherwise disposed of and the
related allowance for depreciation have been eliminated from the
accounts in the year of disposal and the resulting gain or loss has
been recorded in operations. Assets which are expected to have no
substantial salvage value are written off against applicable
depreciation reserves at the expiration of their useful lives.
i. Deferred Income Taxes - Effective January 1, 1993, the Company
adopted the provisions of Statement of Financial Accounting Standards
No. 109, "Accounting for Income Taxes" (SFAS 109). SFAS 109 requires
recognition of deferred tax liabilities and assets for the expected
future tax consequences of events that have been included in the
financial statements. Under this method, deferred tax liabilities and
assets are determined based on the difference between the financial
statement and tax bases of assets and liabilities using the currently
enacted tax rates.
13
15
j. Research and Development - Research and development costs ($91,251 in
1995, $104,762 in 1994 and $169,241 in 1993) are included in the cost
of goods sold caption on the consolidated statements of income
(loss).
k. Goodwill and Other Assets - Goodwill represents the excess cost of
investments over the net asset values at acquisition and is being
amortized on a straight line basis over periods ranging from 20 to 40
years. Accumulated amortization aggregated $224,111 and $186,538 at
December 31, 1995 and 1994.
Other assets, at cost, include license agreements, a covenant not to
compete and other fees associated with the Sepro acquisition. These
assets are being amortized on a straight line basis from 4 to 7
years. Accumulated amortization aggregated $2,024,698 and $1,496,299
at December 31, 1995 and 1994.
The Company continually reevaluates the propriety of the carrying
amounts of goodwill and other assets as well as the amortization
period to determine whether current events and circumstances warrant
adjustments to the carrying value and estimates of useful lives. As a
result of this reevaluation, the Company took a charge of $156,666 to
write off the carrying amount of licensing rights related to a
discontinued product, which is included in selling, general and
administrative expenses on the consolidated statement of income
(loss). The Company believes that no other significant impairment of
goodwill or other assets has occurred and that no reduction of the
estimated useful lives is warranted.
l. Accounts Receivable - Accounts Receivable are shown less allowance
for doubtful accounts of $132,593 in 1995 and $197,822 in 1994.
m. Postretirement Benefits - Effective January 1, 1993, the Company
adopted the provisions of Statement of Financial Accounting Standards
No. 106, "Employers Accounting for Postretirement Benefits Other Than
Pensions." There was no impact on the Company's financial position
and results of operations.
n. Reclassifications - Certain reclassifications have been made to prior
year amounts to conform to and be consistent with the 1995
presentation.
14
16
2. Inventory:
Inventory consisted of the following balances on December 31 which are net of
a $3,611,355 and $230,000 inventory reserve in 1995 and 1994, respectively.
The Company recorded an inventory valuation loss of $3,381,355 and $230,000 in
1995 and 1994, respectively, the former of which resulted primarily from a
program to convert inventory to cash.
1995 1994
___________________________________________________________
Finished goods $ 9,941,846 $ 11,227,978
Work in process 3,962,928 5,246,507
Raw materials and supplies 4,108,477 4,525,053
___________________________________________________________
Total $ 18,013,251 $ 20,999,538
___________________________________________________________
3. Other Assets
Other assets consisted of the following balances on December 31:
1995 1994
___________________________________________________________
Licensing agreements $ 1,169,465 $ 1,705,416
Prepaid pension costs 372,936 1,112,109
Other 79,383 218,000
___________________________________________________________
Total $ 1,621,784 $ 3,035,525
___________________________________________________________
4. Other Accrued Liabilities:
Other accrued liabilities consisted of the following balances on December 31:
1995 1994
___________________________________________________________
Pension $ 520,399 $ 470,400
Vendor Rebates 797,047 473,296
Other 1,925,312 1,997,450
___________________________________________________________
Total $ 3,242,758 $ 2,941,146
___________________________________________________________
15
17
5. Pension and Profit Sharing:
The Company has a pension plan covering substantially all U.S. employees and
separate plans for the foreign subsidiaries' employees. The pension expense
for 1995, 1994 and 1993, which is included in selling, general and
administrative expenses, aggregated $1,008,511, $442,206 and $322,814,
respectively.
U.S. employees are covered by a funded, defined benefit pension plan. The
benefits are based on years of service and the average compensation of the
highest three consecutive years during the last ten years of employment.
Pension expense for U.S. employees was $829,738, $293,145 and $191,965 in
1995, 1994 and 1993 respectively. In December 1995 the Company's Board of
Directors approved an amendment to the U.S. pension plan ceasing all future
benefit accruals as of February 1, 1996, without terminating the pension plan.
Accordingly, this action was accounted for as a curtailment under the
provisions of Statement of Financial Accounting Standards No. 88 "Employers'
Accounting for Settlements and Curtailments of Defined Benefit Pension Plans
and for Termination Benefits," and resulted in a curtailment loss of $299,183.
Plan assets and liabilities and prepaid pension costs shown reflect the
effect of this curtailment loss.
Pension coverage for employees of the Company's foreign subsidiaries vary by
country and the Company's funding policy varies in line with local commercial,
actuarial and taxation practices. The Company has not adopted the provisions
of Statement of Financial Accounting Standards No. 87 "Accounting for
Pensions" for its foreign pension plans. However, it has been determined that
the impact on total consolidated assets, liabilities and net income is not
significant as a result of not adopting Statement of Financial Accounting
Standards No. 87. Foreign subsidiaries' pension expense for 1995, 1994 and
1993 was $178,773, $149,061 and $130,849, respectively.
Net periodic pension cost of the U.S. pension plan for 1995, 1994 and 1993
included the following components:
1995 1994 1993
_____________________________________________________________________________
Service cost - benefits earned
during the period $ 297,659 $ 311,048 $ 242,949
Interest cost on projected
benefit obligation 474,096 375,989 348,306
Actual return on assets (334,058) (114,510) (234,401)
Curtailment loss 299,183 - -
Net amortization and deferral 92,858 279,382 164,889
_____________________________________________________________________________
Net pension expense $ 829,738 $ 293,145 191,965
_____________________________________________________________________________
Assumptions used in the accounting for pension expenses were:
1995 1994 1993
_____________________________________________________________________________
Discount rate 7.0% 7.0% 7.5%
Average wage increase 5.5% 5.5% 5.0%
Expected long-term rate of
return on plan assets 8.0% 10.0% 10.0%
_____________________________________________________________________________
The discount rate is the estimated rate at which the obligation for pension
benefits could effectively be settled. The average wage increase assumption
reflects the Company's best estimate of the future compensation levels of the
individual employees covered by the plans. The expected long-term rate of
return on plan assets reflects the average rate of earnings that the Company
estimates will be generated on the assets of the plan. The Company has reduced
the expected long-term rate of return on plan assets to more accurately
reflect anticipated plan performance.
16
18
The funded status of the Company's U.S. plan as of December 31, 1995 and 1994
is as follows:
1995 1994
_____________________________________________________________________________
Actuarial present value of benefit obligations:
Vested benefit obligation $ 4,916,289 $ 3,960,681
Accumulated benefit obligation 5,082,890 4,053,354
Projected benefit obligation 5,082,890 5,214,085
Plan assets at fair value,
primarily mutual funds 5,098,371 5,162,880
Projected benefit obligation 5,082,890 5,214,085
_____________________________________________________________________________
Plan assets in excess of/(less than)
Projected benefit obligation 15,481 51,205
Adjustments:
Unrecognized loss from past experience 357,455 784,951
Unrecognized past service cost - (61,395)
Unrecognized transition obligation
being amortized over 15 years - 439,758
_____________________________________________________________________________
Prepaid pension costs at December 31 $ 372,936 $ 1,112,109
_____________________________________________________________________________
The Company also has a qualified, non-contributory profit sharing plan
covering substantially all U.S. employees. Amounts are contributed annually to
provide retirement or other benefits for employees and contributions are
calculated under a formula based on income before income taxes and gains or
losses on investments, less a fixed return on a capital base (as defined).
Based on the formula, no contribution was required for 1995, 1994 and 1993. A
specific contribution amounting to 2% of wages will be contributed annually
commencing 1996.
17
19
6. Income Taxes:
On January 1, 1993 the Company adopted Statement of Financial Accounting
Standards No. 109 (SFAS 109), "Accounting for Income Taxes." The adoption
of SFAS 109 did not have an impact on the opening retained earnings.
The current and deferred income tax provisions (benefits) are as follows:
1995 1994 1993
_____________________________________________________________________________
Current:
Federal $ 9,103 $ 15,642 $ -
State 35,262 28,585 58,689
Foreign 80,595 65,828 (410,373)
_____________________________________________________________________________
$ 124,960 $ 110,055 $ (351,684)
_____________________________________________________________________________
Deferred:
Federal $ (88,810) $ 18,037 $ (134,498)
State (9,090) (23,137) (14,680)
Foreign (577,296) (16,054) 103,335
_____________________________________________________________________________
(675,196) (21,154) (45,843)
_____________________________________________________________________________
$ (550,236) $ 88,901 $ (397,527)
_____________________________________________________________________________
The State tax provision is comprised of the minimum capital tax and other
franchise taxes related to the jurisdictions in which the Company's
manufacturing plants reside.
The U.S. and foreign income (loss) before income taxes are as follows:
1995 1994 1993
_____________________________________________________________________________
U.S. (loss) $ (4,735,350) $ (35,983) $ (191,572)
Foreign income (loss) $ (4,531,062) $ 248,382 $ (803,200)
_____________________________________________________________________________
$ (9,266,412) $ 212,399 $ (994,772)
_____________________________________________________________________________
The provision (benefit) for income taxes is different from that which would be
computed by applying the United States statutory income tax rate to income
(loss) before income taxes. The following schedule reconciles the income tax
provision (benefit) computed at the United States statutory rate to the actual
tax provision (benefit) reported.
1995 1994 1993
_____________________________________________________________________________
Federal income tax at 34%
statutory rate $ (3,150,580) $ 72,216 $ (338,222)
State and local taxes,
net of federal income tax effect (72,500) 3,596) 29,046
Foreign income tax rate (675,600) (34,675) (33,950)
Deferred tax asset valuation
allowance 2,788,900 - -
Prior year tax accrual adjustment - 30,000 (79,299)
Repatriated earnings of foreign
subsidiary 410,100 - -
Permanent differences 188,500 19,267 12,623
All other items, net (39,056) (1,503) 12,275)
_____________________________________________________________________________
Provision (benefit) for income taxes $ (550,236) $ 88,901 $ (397,527)
_____________________________________________________________________________
Total income taxes paid, net of
refunds $ 66,683 $ (299,855) $ 152,515
_____________________________________________________________________________
18
20
The significant sources of deferred tax liabilities and assets as of December
31 are as follows:
1995 1994
_____________________________________________________________________________
Deferred tax liabilities:
Property, plant and equipment $ 1,013,200 $ 1,253,100
Pension plans 256,200 429,200
Disposal of land and building 63,700 67,700
Repatriated earnings of foreign subsidiary 410,100 -
Other - 25,000
_____________________________________________________________________________
Total deferred tax liabilities $ 1,743,200 $ 1,775,000
_____________________________________________________________________________
Deferred tax assets:
Reserves and allowances $ 2,984,200 $ 558,100
Tax basis operating loss carryforwards 1,063,600 210,700
Intangible assets 475,200 316,816
Other 9,100 42,365
_____________________________________________________________________________
Total deferred tax assets $ 4,532,100 $ 1,127,981
_____________________________________________________________________________
Net deferred tax liability (assets)
before valuation allowance $ (2,788,900) $ 647,019
_____________________________________________________________________________
Valuation allowance 2,788,900 -
_____________________________________________________________________________
Net deferred tax liability $ - $ 647,019
_____________________________________________________________________________
The Company provides deferred taxes on foreign subsidiary earnings which are
not considered permanently reinvested. Earnings permanently reinvested would
become taxable upon the sale or liquidation of a foreign subsidiary or upon
the remittance of dividends. $3,808,000 and $6,460,000 of foreign subsidiary
earnings are considered permanently reinvested as of December 31, 1995 and
1994, respectively. If such earnings were not permanently reinvested, a
deferred tax liability would have been required. The amount of deferred tax
liability cannot be reasonably determined.
SFAS 109 requires that a valuation allowance be recorded against tax assets
which are not likely to be realized. Realization of the Company's tax assets,
other than those which will be realized by future reversals of existing
taxable temporary differences, is entirely dependent on future earnings. Due
to the uncertain nature of their realization based on past performance and
carry forward expiration dates, the Company has established a full valuation
allowance against these tax assets. The need for this valuation allowance is
subject to periodic review, and if the allowance is reduced, the tax benefit
will be recorded in future operations as a reduction of the Company's tax
expense.
At December 31, 1995, the Company has tax operating loss carryforwards
aggregating $2,130,000, of which $78,000 relate to U.S. Federal income taxes
and expire in 2010, and $2,052,000 relate to foreign operations. Foreign tax
operating loss carryforwards totaling $97,000 expire in 2002 and $1,955,000
can be carried forward indefinitely.
19
21
7. Notes Payable and Long Term Debt:
Notes Payable consisted of the following:
1995 1994
_____________________________________________________________________________
Overdraft arrangements (B) $ 2,595,374 $ 2,057,940
Current portion of long term debt 1,054,742 1,942,129
_____________________________________________________________________________
$ 3,650,116 $ 4,000,069
Long Term Debt consisted of the following:
1995 1994
_____________________________________________________________________________
Revolving Credit (A) $ 9,300,000 $ 9,400,000
Mortgage Note (C) 522,075 483,975
Note Payable (D) 353,262 408,063
Note Payable (E) 400,745 447,959
Note Payable (F) 1,669,834 1,737,248
Note Payable (G) 1,392,200 1,290,600
Note Payable (H) 2,213,445 2,453,250
Other Obligations 83,326 108,624
_____________________________________________________________________________
$ 15,934,887 $ 16,329,719
Less, current portion 1,054,742 1,942,129
_____________________________________________________________________________
$ 14,880,145 $ 14,387,590
_____________________________________________________________________________
(A) Until March 7, 1996, the Company had a revolving line of credit with
a maximum availability of $13,000,000 of which $750,000 was used for
letters of credit. Prior to the modification of the agreement on
March 7, 1996, principal repayment was due in March 1997 and interest
was at prime or LIBOR plus 2 1/4%, at the option of the Company,
except in January 1995 the Company entered into a modification
agreement with the lender fixing the interest rate at 9.37% for one
year on $8,500,000. The line was collateralized by all U.S. assets
except real estate and required an annual fee of 1/4% of the line. As
of December 31, 1995, $2,950,000 was available under the general
facilities and $623,000 was available for letters of credit.
The loan agreement contained covenants which restricted, among other
things, additional borrowings, expenditures for fixed assets, the
payment of dividends, and the acquisition of the Company's capital
stock. On December 31, 1995 the Company was in violation of various
covenants which were unconditionally waived in March 1996. Borrowings
outstanding under this agreement vary with the cash needs of the
Company and are classified as long term due to the Company's ability
and intent to renew the balance outstanding, as needed, for more than
one year.
On March 7, 1996, the Company renegotiated the line of credit. Under
the modified agreement, the line availability is determined using an
asset-based formula. The maximum availability of the credit line is
$13,000,000, reducing to $9,000,000 during the last 60 days of each
calendar year. The actual amount available is based on a core
availability of $2,250,000 plus 80% of eligible receivables, varying
percentages of eligible inventory and $750,000 over formula which
expires October 31, 1996. Principal repayment is due in May 1998 and
interest is at prime plus 1/2%. The line is collateralized by all
U.S. assets except real estate in Bridgeport, Connecticut and Seneca
Falls, New York, and requires an annual fee of 1/4% of the line. The
modified agreement contains covenants which restrict, among other
things, additional borrowings, expenditures for fixed assets, the
payment of dividends, and the acquisition of the Company's capital
stock.
20
22
(B) The Company has overdraft facilities for its foreign operations with
various foreign banks. At December 31, 1995, the Company had lines of
credit for Canadian dollars 2,000,000, British pounds 850,000 and
German marks 1,600,000. Unused amounts available were Canadian
dollars 1,512,104 ($1,108,221), British pounds 57,052 ($88,602) and
German marks 154,308 ($107,413). The lines have interest rates
ranging from local prime to local prime plus 2 1/2%.
(C) Mortgage note payable for 750,000 German marks to a foreign bank is
collateralized by the real estate. Annual principal payment is DM
150,000 through 1999 and the interest rate is 8.85%, payable
quarterly.
(D) Note payable for 507,048 German marks to a foreign bank is
collateralized by the accumulated funds of an employee sponsored
life/survivorship insurance program offered for the benefit of the
employees. Repayment is required only as funds are needed to pay
benefits under the insurance contract. The Company has classified the
debt as long term because it is not aware of any benefits due under
the contract in 1996.
(E) Note payable for 575,699 German marks to a foreign bank is
collateralized by inventory, accounts receivable, machinery and
equipment and real estate. Principal is payable in monthly
installments ending October 1999 and the annual interest rate is
9.85% .
(F) Note payable for 2,398,842 German marks to a foreign bank is
collateralized by accounts receivable, inventory, machinery and
equipment and real estate. Principal is payable in monthly
installments ending October 2001 and the annual interest rate is
9.8%.
(G) Note payable for 2,000,000 German marks to a foreign bank is a two
year term loan collateralized by accounts receivable, inventory,
machinery, equipment and real estate. Principal is payable in full
in October 1997 and the annual interest rate is 7.75%.
(H) Note Payable to Sepro Healthcare Inc. matures on March 31, 2000.
Principal repayments are quarterly and vary during the life of the
loan. The annual interest rate is 11%.
Annual maturities of debt in each of the next five years are approximately as
follows:
________________________
1996 $ 1,054,742
1997 $ 2,500,064
1998 $ 10,597,531
1999 $ 797,496
2000 $ 329,781
________________________
Interest payments were approximately $1,951,700 in 1995, $1,653,600 in 1994
and $1,562,100 in 1993.
The weighted average interest rate for short term borrowings was 8.6% and 9.1%
at December 31, 1995 and 1994, respectively.
21
23
8. Commitments and Contingencies:
The Company leases certain office, manufacturing and warehouse facilities and
various equipment under non-cancelable operating leases. Total rental expense
was $943,000 in 1995, $918,000 in 1994 and $949,000 in 1993. Minimum annual
rental commitments under non-cancelable leases with initial or remaining terms
of 1 year or more, but excluding future lease commitments recorded as a lease
termination cost in the restructuring and other charges, are as follows:
________________________
1996 $ 691,000
1997 $ 653,000
1998 $ 385,000
1999 $ 358,000
2000 $ 348,000
Later $ 39,000
________________________
The Company has purchased $678,000 of forward exchange contracts to hedge
future purchases through May 30, 1996. Any gain or loss on these contracts is
deferred until settlement date of the transaction being hedged. The deferred
gain or loss as of December 31, 1995 and 1994 is not significant.
The Company has been involved in certain environmental matters. Based on
information available, the Company does not expect a significant impact on the
financial position, future operations or cash flows of the Company relating to
these matters.
22
24
9. Business Segments:
The Company operates principally in two business segments. Operations in the
medical segment involve the production and sale of metal disposable medical
scissors and instruments, sterile procedure trays, germicidal products,
dressings and wound care packs for hospitals and the alternate care markets.
Operations in the consumer segment involve the production and sale of
scissors, shears, knives, rulers and first aid kits for school, office or home
use. Intersegment sales and transfers between geographic areas are not
significant. Operating profit is total sales less expenses other than general
corporate expenses, interest expense and income taxes. Identifiable assets by
business segment and geographic areas are those assets that are used in the
Company's operations in each business segment and geographic area. Corporate
assets are principally cash, leasehold improvements and office equipment.
Information on the Company's Operations and Assets by Business Segments:
(All Figures in Thousands) 1995 1994 1993
_____________________________________________________________________________
Sales:
Consumer $ 35,882 $ 36,015 $ 35,197
Medical 16,340 16,740 17,142
_____________________________________________________________________________
Total 52,222 52,755 52,339
_____________________________________________________________________________
Operating Profit (Loss)*
Consumer $ (4,325) $ 2,894 $ 866
Medical 394 1,996 2,396
_____________________________________________________________________________
Total (3,931) 4,890 3,262
_____________________________________________________________________________
General corporate expenses 3,382 3,020 2,703
Interest expenses 1,953 1,658 1,554
_____________________________________________________________________________
Income/(Loss) before income taxes $ (9,266) $ 212 $ (995)
_____________________________________________________________________________
Identifiable Assets:
Consumer $ 27,676 $ 30,765 $ 28,175
Medical 8,160 9,528 11,317
Corporate 1,185 2,595 2,471
_____________________________________________________________________________
Total $ 37,021 $ 42,888 $ 41,963
_____________________________________________________________________________
*1995 Operating profit (loss)
includes the following: Medical Consumer Total
______________________________________________________________________
Restructuring & other charges $ 235 $ 2,901 $ 3,136
Asset valuation adjustments 981 2,584 3,565
______________________________________________________________________
$ 1,216 $ 5,485 $ 6,701
______________________________________________________________________
(All Figures in Thousands) 1995 1994 1993
_____________________________________________________________________________
Depreciation Expenses:
Consumer $ 1,069 $ 1,024 $ 977
Medical 181 195 218
Corporate 63 89 85
Amortization Expenses:
Consumer 14 12 13
Medical 552 562 525
Corporate - - -
Capital Expenditures
Consumer $ 436 $ 1,320 $ 859
Medical 272 84 224
Corporate 279 41 76
23
25
Information on the Company's Operations and Assets by Geographic Areas:
(All Figures in Thousands) 1995 1994 1993
_____________________________________________________________________________
Sales:
United States $ 34,471 $ 33,774 $ 34,206
Canada 4,155 3,777 4,208
England 4,130 4,676 4,333
Germany 9,466 10,528 9,592
_____________________________________________________________________________
Total $ 52,222 $ 52,755 $ 52,339
_____________________________________________________________________________
Operating Profit (Loss)*
United States $ (131) $ 3,656 $ 3,102
Canada (211) 68 (137)
England (974) 735 556
Germany (2,615) 431 (259)
_____________________________________________________________________________
Total (3,931) 4,890 3,262
_____________________________________________________________________________
General corporate expenses 3,382 3,020 2,703
Interest expense 1,953 1,658 1,554
_____________________________________________________________________________
Income/(Loss) before income taxes $ (9,266) $ 212 $ (995)
_____________________________________________________________________________
Identifiable Assets:
United States $ 20,777 $ 23,055 $ 22,690
Canada 3,581 4,079 4,280
England 3,660 4,475 4,632
Germany 7,818 8,684 7,890
Corporate 1,185 2,595 2,471
_____________________________________________________________________________
Total $ 37,021 $ 42,888 $ 41,963
_____________________________________________________________________________
* 1995 Operating profit (loss) includes the following:
Asset
Restructuring & Valuation
Other Charges Adjustments Total
______________________________________________________________________
United States $ 798 $ 2,272 $ 3,070
Canada - 299 299
England 221 643 864
Germany 2,117 351 2,468
______________________________________________________________________
$ 3,136 $ 3,565 $ 6,701
______________________________________________________________________
24
26
10. Stock Option Plans:
The 1988 stock option plan was amended and restated on February 25, 1992. The
Board of Directors adopted a series of amendments to the Plan which were
approved at the 1992 Annual Meeting. The principal changes adopted are an
increase in the aggregate number of shares of Common Stock available under the
Plan from 100,000 shares to 300,000 shares and provisions for the issuance of
options as Incentive Stock Options under the provision of Section 422 of
Internal Revenue Code. Options granted prior to the amendment are nonqualified
stock options and are included in the 300,000 shares. Incentive Stock Options
and nonqualified stock options may be granted under the amended Plan. In
January, 1996 the Board of Directors adopted an amendment to the Plan,
increasing the aggregate number of Common Stock shares available under the
Plan from 300,000 shares to 400,000 shares, to be approved by the shareholders
at the 1996 Annual Meeting.
Under the Company's 1992 Amended and Restated Stock Option Plan, officers and
key employees may be granted options, each of which allows for the purchase of
common stock at a price of not less than 100% of fair market value at the date
of grant. Generally, each option granted under the Plan vests immediately or
within a year and is for a term not in excess of ten years from the date of
grant. No option may be granted under the Plan after the tenth anniversary of
the adoption of the Plan.
The Company is currently evaluating the provisions of Statement of Financial
Accounting Standards No. 123, "Accounting for Stock-Based Compensation" and
plans on implementing the statement in 1996 in accordance with its effective
date.
A summary of changes in options issued under the Plan is as follows:
1995 1994 1993
_____________________________________________________________________________
Shares under option and exercisable
at the beginning of the year 151,000 63,000 69,000
Options granted 155,000 90,000 -
Options canceled (56,000) (2,000) (6,000)
Options exercised - - -
_____________________________________________________________________________
Shares under option and exercisable
at the end of the year 250,000 151,000 63,000
_____________________________________________________________________________
Options available for future grants
at the end of the year 50,000 149,000 237,000
_____________________________________________________________________________
Average price of options granted $ 3.63 $ 3.19 -
Average price of options canceled $ 3.74 $ 5.13 $ 5.13
Average price of options exercisable $ 3.81 $ 3.97 $ 5.13
_____________________________________________________________________________
11. Restructuring and Other Charges:
In December 1995, the Company implemented a restructuring plan primarily
designed to decrease production costs and inventory levels in the consumer
segment by consolidating manufacturing facilities in the United States and
Germany. The restructuring plan is expected to be substantially complete by
the end of 1996. A pretax charge of $3,136,000 was recorded which resulted
from lease termination costs of $1,466,000, employee termination costs of
$683,000, adjustments in the carrying value of production assets and idle real
estate of $749,000, and other costs of $238,000. The employee termination
costs are attributable to the elimination of nearly seventy positions, mostly
production employees. No cash expenditure occurred in 1995 for the
restructuring and other charges. Cash expenditures are expected in 1996 for
employee termination costs and a portion of lease termination costs which will
occur over the next five years.
26
28
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Stockholders of Acme United Corporation:
We have audited the accompanying consolidated balance sheets of Acme United
Corporation and Subsidiaries as of December 31, 1995 and 1994, and the related
consolidated statements of income (loss), stockholders' equity and cash
flows for each of the three years in the period ended December 31, 1995. 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 audits.
We conducted our audits 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 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 audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Acme United
Corporation and Subsidiaries as of December 31, 1995 and 1994, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended December 31, 1995, in conformity with
generally accepted accounting principles.
/s/ COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Hartford, Connecticut
March 12, 1996
26
28
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
(None)
PART III
Item 10. Directors and Executive Officers of the Registrant
The following table sets forth certain information with respect to the
directors and executive officers of the Company. All directors of the Company
hold office until the next annual meeting of the shareholders or until their
successors have been elected and qualified. Executive officers are elected to
the Board of Directors to hold office until their successors are elected and
qualified.
Name Age Position Held with Company
_____________________ ___ ________________________________________________
Walter C. Johnsen 45 President, Chief Executive Officer, Chief
Financial Officer and Director
Dwight C. Wheeler II 53 Vice Chairman, Secretary, Treasurer and Director
Andrew T. Harrison 64 Senior Vice President
Gary D. Penisten 64 Chairman of the Board and Director
Henry C. Wheeler * 79 Director
James F. Farrington 69 Director not seeking reelection
David W. Clark, Jr. 58 Director
George R. Dunbar 72 Director
Newman M. Marsilius 78 Director
Wayne R. Moore 65 Director
James L.L. Tullis 48 Director nominee
* Henry C. Wheeler is the father of Dwight C. Wheeler II.
Walter C. Johnsen has served as director since 1995 and as President and Chief
Executive Officer since November 30, 1995 and Chief Financial Officer since
March 26, 1996. Prior to that he was Executive Vice President since January
24, 1995. Before joining the Company he was Vice Chairman and Principal of
Marshall Products, Inc., a medical supply distributor.
Dwight C. Wheeler II has served as a director since 1980, Vice Chairman since
November 30, 1995, Secretary since March 26, 1996 and Treasurer since April
23, 1990. Prior to that he was President and Chief Executive Officer since
December 20, 1994 and Executive Vice President and Chief Operating Officer for
five years. Mr. Wheeler has held positions as Corporate Vice President -
Administration, Industrial Engineer and Assistant to the President since
joining the Company in 1966.
Andrew T. Harrison has served as Senior Vice President since 1981. Prior to
that he served as Vice President of Regulatory Affairs for four years.
27
29
Stephen T. Bajda has served as Senior Vice President Finance since 1988 and
Secretary since 1986. Prior to that he served as Vice President of Finance for
two years. Mr. Bajda left company employment March 25, 1996.
Gary D. Penisten has served as director since 1994 and Chairman of the Board
since February 27, 1996. He is a Director of D. E. Foster & Partners L.P., an
executive search firm, and Food Court Entertainment Network, Inc., a shopping
mall advertising entertainment venture. From 1977 to 1988, he was Senior Vice
President of Finance, Chief Financial Officer and a Director of Sterling Drug
Inc. in New York City.
Henry C. Wheeler has served as director since 1941. He is now Chairman
Emeritus after serving as Chairman through November 29, 1995 and President,
Treasurer and Chief Executive Officer from 1941 to December 20, 1994.
James F. Farrington has served as director since 1985 but is not seeking
reelection upon the expiration of his term at the next Annual Meeting of the
Shareholders on April 22, 1996. Mr. Farrington retired in 1995 from his
position as Executive Vice President, after holding that position for five
years. He has also served as Vice President and Senior Vice President of the
Company for twenty years.
David W. Clark, Jr. has served as director since 1980. He is Managing Director
of Pryor & Clark Company, an investment company. From July 1988 to June 1992,
Mr. Clark was President of Corcap, Inc. which was spun off Lydall, Inc. in
July 1988. Mr. Clark joined Lydall in 1972 as Vice President-Treasurer and
Director. He became Executive Vice President in 1977 and President in 1986.
Until July of 1992, Mr. Clark was also Chairman of the Board of CompuDyne
Corporation of which he remains a Director. He is also a Director of
Checkpoint Systems, Inc., Thorofare, NJ and Securities Software and Consulting
Company, Hartford, Connecticut.
George R. Dunbar has served as director since 1977. He is President of Dunbar
Associates, a municipal management consulting firm. He was Former Chief
Administrative Officer for the City of Bridgeport and served as President
(1972-87) of Bryant Electric Corporation, manufacturer of wiring devices load
centers, circuit breakers and ground fault products, Bridgeport, Connecticut.
Mr. Dunbar is also a Director of People's Bank, Bridgeport, Connecticut.
Newman M. Marsilius has served as director since 1956. He was Chairman of the
Board (1978 - 1986) of The Producto Machine Company, manufacturer of special
machine tools and tooling products, Bridgeport, Connecticut.
Wayne R. Moore has served as director since 1976. He is Chairman of the Board,
The Producto Machine Company, manufacturer of machine tools, special machines,
and tool die and mold components and Chairman of the Board of Moore Tool
Company, manufacturer of machine tools, measuring machines and metrology
products. Mr. Moore was Chairman of the Association for Manufacturing
Technology/U.S. Machine Tool Builders (1985-1986)and Committee Member of U.S.
Eximbank (1984).
James L.L. Tullis is up for election to the Board of Directors at the 1996
Annual Meeting of Shareholders. He is Chairman and Chief Executive officer of
Tullis-Dickerson & Company, Inc., Greenwich, Connecticut, a management company
for venture capital firms. From 1972-1983 he was a securities analyst
researching the health care industry at Putnam Funds and Morgan Stanley and
Company, Inc. He also was a senior vice president at E.F. Hutton and Company,
and established a health care investment banking business there. He is a
former President of the Investment Association of New York. He is a director
of Physician Sales & Service, Inc., Zynaxis, Inc., Chattanooga Group, Inc.,
Quantum Solutions, Inc., PRP, Inc. and Guidestar, Inc.
Item 11. Executive Compensation
(Refer to Proxy Statement pages 7-11)
Item 12. Security Ownership of Certain Beneficial Owners and Management
(Refer to Proxy Statement pages 1-3)
Item 13. Certain Relationships and Related Transactions
(None)
28
30
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a) Documents filed as part of this report:
1. Financial Statements Page(s)
Consolidated Balance Sheets 11
Consolidated Statements of Income and (Loss) 10
Consolidated Statements of Changes in stockholder's Equity 10
Consolidated Statements of Cash Flows 12
Notes to Financial Statements 13-25
Report of Independent Accountants 26
2. Financial Statement Schedules
Schedule II 30
Schedules other than those listed above have been omitted because the required
information is contained in the financial statements and notes thereto, or
because such schedules are not required or applicable.
3. Exhibits
Exhibit A - Earnings Per Share Computation 31
Exhibit B - Parents and Subsidiaries 31
The following basic documents are contained in S-1 Registration Statement No.
230682 filed with the Commission on November 7, 1968 and amended by
Substantive Amendment No. 1 on December 31, 1968 and by No. 2 on January 31,
1969:
Certificate of Organization of Registrant
Amendment to Certificate of Incorporation of Registrant dated September 24,
1968
Proof of Common Stock Certificates
The following basic documents were filed with Form 10-K for 1971:
Amendment to Certificate of Incorporation of Registrant dated April 27, 1971
Amendment to Certificate of Incorporation dated June 29, 1971
Proof of Common Stock Certificate
Proof of Preferred Stock Certificate
(b) No Form 8-K was filed by the Company during the quarter ended December 31,
1995.
Report of Independent Accountants
To the Board of Directors and Stockholders of Acme United Corporation:
Our report on the consolidated financial statements of Acme United Corporation
and Subsidiaries is included on page 26 of this Form 10-K. In connection with
our audits of such financial statements, we have also audited the related
financial statement schedule included on page 30 of this Form 10-K.
In our opinion, the financial statement schedule referred to above, when
considered in relation to the basic financial statements taken as a whole,
presents fairly, in all material respects, the information required to be
included therein.
/s/ COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Hartford, Connecticut
March 12, 1996
29
31
SCHEDULE II
ACME UNITED CORPORATION VALUATION AND QUALIFYING ACCOUNTS
For the years ended December 31, 1995, 1994 and 1993
Balance at Charged to Balance
Beginning Costs and at End
of Period Expenses Deductions of Period
1995
Restructuring Reserve * $ - $ 2,549,500 $ - $ 2,549,500
Inventory Reserves 230,000 3,381,355 - 3,611,355
Allowance for
Doubtful Accounts 197,822 116,321 181,550 132,593
___________________________________________________________________________
$ 427,822 $ 6,047,176 $ 181,550 $ 6,293,448
___________________________________________________________________________
1994
Inventory Reserves $ - $ 230,000 $ - $ 230,000
Allowance for
Doubtful Accounts 167,532 113,837 83,547 197,822
___________________________________________________________________________
$ 167,532 $ 343,837 83,547 $ 427,822
___________________________________________________________________________
1993
Restructuring Reserve $ 416,113 $ 1,267 $ 417,380 $ -
Allowance for
Doubtful Accounts 137,933 139,147 109,548 167,532
___________________________________________________________________________
$ 554,046 $ 140,414 $ 526,928 $ 167,532
___________________________________________________________________________
* excludes $ 586,500 asset valuation charges relating to production assets
30
32
EXHIBIT A
(For Exhibit to Form 10-K, 1995)
ACME UNITED CORPORATION AND SUBSIDIARIES
EARNINGS/(LOSS) PER SHARE COMPUTATION
PRIMARY AND FULLY DILUTED
1991
Total Earnings $ 1,334,246 / 3,273,000 Shares = $.408 Per Share
1992
Total Loss $ (546,615) / 3,325,119 Shares = ($.164) Per Share
1993
Total Loss $ (597,245) / 3,337,620 Shares = ($.179) Per Share
1994
Total Earnings $ 123,498 / 3,337,620 Shares = $.037 Per Share
1995
Total Loss $ (8,716,176) / 3,337,620 Shares = ($2.61) Per Share
EXHIBIT B
(For Exhibit to Form 10-K, 1995)
PARENT AND SUBSIDIARIES
The Company was organized as a partnership in 1867 and incorporated in 1882
under the laws of the State of Connecticut as The Acme Shear Company. The
corporate name was changed to Acme United Corporation in 1971.
There is no parent of the registrant.
Registrant has the following subsidiaries, all of which are totally held:
Name State or Country of Incorporation
Acme United Limited Canada
Acme United, Ltd. England
Emil Schlemper GmbH Germany
Westcott Ruler Company, Inc. New York
The Acme Shear Company Connecticut
Peter Altenbach & Son GmbH Germany
Only Acme United Limited (Canada), Acme United, Ltd. (England), Emil Schlemper
GmbH and Peter Altenbach & Son GmbH are active and included in the
consolidated financial statements.
31
33
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized, on March 18, 1996.
ACME UNITED CORPORATION
(Registrant)
Signatures Titles
/s/ Walter C. Johnsen
___________________________
Walter C. Johnsen Chief Executive Officer, Chief Financial
Officer and Director
/s/ Gary D. Penisten
___________________________
Gary D. Penisten Chairman of the Board and Director
/s/ Dwight C. Wheeler II
___________________________
Dwight C. Wheeler II Vice Chairman, Secretary, Treasurer and Director
/s/ Richard L. Windt
___________________________
Richard L. Windt Controller (Principal Accounting Officer)
/s/ David W. Clark, Jr.
___________________________
David W. Clark, Jr. Director
/s/ George R. Dunbar
___________________________
George R. Dunbar Director
/s/ James F. Farrington
___________________________
James F. Farrington Director
/s/ Newman M. Marsilius
___________________________
Newman M. Marsilius Director
/s/ Wayne R. Moore
___________________________
Wayne R. Moore Director
/s/ Henry C. Wheeler
___________________________
Henry C. Wheeler Director
32
34
OFFICERS
Walter C. Johnsen
President, Chief Executive Officer
and Chief Financial Officer
Gary D. Penisten
Chairman of the Board
Dwight C. Wheeler II
Vice Chairman, Secretary
and Treasurer
Andrew T. Harrison
Senior Vice President
Ian W. Sloan
Senior Vice President
DIRECTORS
David W. Clark, Jr.
Managing Director
Pryor & Clark Company
Hartford,Connecticut
President (1988-1992)
Corcap, Inc.
George R. Dunbar
President
Dunbar Associates
Monroe, Connecticut
President (1972-1987)
Bryant Electric Division
Westinghouse Electric Corporation
James F. Farrington
Executive Vice President (Retired)
Acme United Corporation
Walter C. Johnsen
President, Chief Executive Officer
and Chief Financial Officer
Newman M. Marsilius
Chairman of the Board (1978-1986)
Producto Machine Company
Bridgeport, Connecticut
Wayne R. Moore
Chairman of the Board
Producto Machine Company
Bridgeport, Connecticut
Gary D. Peniston
Chairman of the Board
Acme United Corporation
Dwight C. Wheeler II
Vice Chairman, Secretary
and Treasurer
Acme United Corporation
Henry C. Wheeler
Chairman of the Board (Retired)
Acme United Corporation
CORPORATE OFFICES
Acme United Corporation
75 Kings Highway Cutoff
Fairfield, Connecticut 06430
(203) 332-7330
TRANSFER AGENT
American Stock Transfer Company
40 Wall Street
New York, N.Y. 10005
STOCK LISTING
The stock of Acme United Corporation is traded on the
American Stock Exchange under the symbol ACU.
COUNSEL
Marsh, Day & Calhoun
Southport, Connecticut
AUDITORS
Coopers & Lybrand L.L.P.
Hartford, Connecticut
ANNUAL MEETING
will be held at 11:00 a.m., Monday,
April 22, 1996 at The Westport Inn,
1595 Post Road East, Westport, Connecticut