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FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year
ended November 30, 1996 Commission file number 0-748
McCORMICK & COMPANY, INCORPORATED
(Exact name of Registrant as specified in its charter)
Maryland 52-0408290
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
18 Loveton Circle 21152
Sparks, Maryland
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (410) 771-7301
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
Not Applicable Not Applicable
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, No Par Value Common Stock Non-Voting, No Par Value
(Title of Class) (Title of Class)
Indicate by check mark whether the Registrant (1) 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. [ ]
Indicate the number of shares outstanding of each of the Registrant's
classes of common stock, as of the latest practicable date.
Aggregate market value of the voting stock held by nonaffiliates of the
Registrant . . . . . . . $182,641,709
The aggregate market value indicated above was calculated as follows:
The number of shares of voting stock held by nonaffiliates of the Registrant
as of January 31, 1997 was 7,379,463. This number excludes shares held by
the McCormick Profit Sharing Plan and PAYSOP and its Trustees, the McCormick
Pension Plan and its Trustees, and the directors and officers of the
Registrant, who may or may not be affiliates. This number was then
multiplied by the closing price of the stock as of January 31, 1997, $24.75.
CLASS NUMBER OF SHARES OUTSTANDING DATE
Common Stock 10,987,195 1/31/97
Common Stock Non-Voting 65,802,523 1/31/97
DOCUMENTS INCORPORATED BY REFERENCE
Document Part of 10-K into
which incorporated
Registrant's 1996 Annual Report to Part I, Part II, Part IV
Stockholders
Registrant's Proxy Statement dated 2/19/97 Part III, Part IV
PART I
As used herein, the "Registrant" means McCormick & Company, Incorporated
and its subsidiaries, unless the context otherwise requires.
ITEM 1. BUSINESS
The Registrant, a diversified specialty food company, is principally
engaged in the manufacture of spices, seasonings, flavorings and other
specialty food products and sells such products to the retail food
market, the food service market and to industrial food processors
throughout the world. The Registrant also, through subsidiary
corporations, manufactures and markets plastic packaging products for
the food, cosmetic and health care industries.
The Registrant's Annual Report to Stockholders for 1996, which is
enclosed as Exhibit 13, contains a description of the general development
during the last fiscal year, of the business of the Registrant, which was
formed in 1915 under Maryland law as the successor to a business
established in 1889. Pages 7 through 13 of that Report are incorporated by
reference. Unless otherwise indicated, all references to amounts in this
Report or in the Annual Report to Stockholders for 1996 are amounts from
continuing operations. The Registrant's net sales increased 2.4% in 1996
to $ 1,732,506,000.
In March 1996, the Registrant formed a joint venture with Pioneer Products,
Inc. for the production and sale of dessert decorating products. The new
company, Signature Brands, LLC, is located in Ocala, Florida and
manufactures and distributes a broad range of such products under the Betty
Crocker (a trademark owned by General Mills) and Cake Mate brand names.
The Registrant implemented a restructuring plan in June 1996 which is
intended to increase focus on core businesses and improve its cost
structure. A description of the actions taken under this plan are set
forth in the Registrant's Annual Report to Stockholders for 1996 in Note 2
of the Notes to Consolidated Financial Statements on pages 22 and 23 and on
pages 37 and 38, which pages are incorporated by reference.
In August 1996, the Registrant sold substantially all of the assets of
Gilroy Foods, Incorporated and Gilroy Energy Company, Inc. to ConAgra, Inc.
and to an affiliate of Calpine Corporation, respectively. Gilroy Foods
manufactures and sells dehydrated onion, garlic, capsicum and vegetable
products. Gilroy Energy operates an energy cogeneration facility. The
Registrant's Annual Report to Stockholders for 1996 sets forth a
description of the sale of Gilroy Foods and Gilroy Energy on page 38 and in
Note 3 of the Notes to Consolidated Financial Statements on page 23. Those
pages of the Registrant's Annual Report are incorporated by reference.
In 1994, the Registrant announced a restructuring plan which reduced the
work force and implemented a program to eliminate redundant facilities and
positions, improve production and efficiency and eliminate certain
businesses and product lines. A description of the actions taken under
this plan are set forth in the Registrant's Annual Report to Stockholders
for 1996 in Note 2 of the Notes to Consolidated Financial Statements on
pages 22 and 23 and on pages 37 and 38, which pages are incorporated by
reference.
The Registrant operates in two business segments, Food Products and
Packaging Products, and has disclosed in Note 10 of the Notes to
Consolidated Financial Statements on pages 31 and 32 of its Annual Report
to Stockholders for 1996, which Note is incorporated by reference, the
financial information about the business segments required by this Item.
PRINCIPAL PRODUCTS/MARKETING
Spices, seasonings, flavorings and other specialty food products are the
Registrant's principal products. The Registrant also manufactures and
markets plastic bottles and tubes for food, personal care and other
products, primarily in the United States. The net sales value of each of
these product segments is set forth in Note 10 of the Notes to Consolidated
Financial Statements on pages 31 and 32 of the Registrant's Annual Report
to Stockholders for 1996, which Note is incorporated by reference. No
other products or classes of similar products or services contributed as
much as 10% to consolidated net sales during the last three fiscal years.
The Registrant markets its food service products and consumer products
through its own sales organization, food brokers and distributors. In the
industrial market, sales are made mostly through the Registrant's own sales
force. The Registrant markets its packaging products through its own sales
force and distributors.
RAW MATERIALS
Many of the spices and herbs purchased by the Registrant are imported
into the United States from the country of origin, although significant
quantities of some materials, such as paprika, dehydrated vegetables, onion
and garlic and food ingredients other than spices and herbs, originate in
the United States. The Registrant is a direct importer of certain raw
materials, mainly black pepper, vanilla beans, cinnamon, herbs and seeds
from the countries of origin. Some of the imported materials are purchased
from dealers in the United States. The principal purpose of such purchases
is to satisfy the Registrant's own needs. In addition, the Registrant
sells imported raw materials to other food processors. The Registrant also
purchases cheese and dairy powders from U.S. sources for use in many
industrial products.
The raw materials most important to the Registrant are onion, garlic and
capsicums (paprika and chili peppers), which are produced in the United
States, black pepper, most of which originates in India, Indonesia,
Malaysia and Brazil, and vanilla beans, a large proportion of which the
Registrant obtains from the Malagasy Republic and Indonesia. The
Registrant does not anticipate any material restrictions or shortages on
the availability of raw materials which would have a significant impact
on the Registrant's business in the foreseeable future.
Substantially all of the raw materials used in the packaging business
originate in the United States.
TRADEMARKS, LICENSES AND PATENTS
The Registrant owns a number of registered trademarks, which in the
aggregate may be material to the Registrant's business. However, the
loss of any one of those trademarks, with the exception of the Registrant's
"McCormick," "Schilling," "Schwartz" and "Club House" trademarks, would not
have a material adverse impact on the Registrant's business. The
"McCormick" and "Schilling" trademarks are extensively used by the
Registrant in connection with the sale of a substantial number of the
Registrant's products in the United States. The "McCormick" and
"Schilling" trademarks are registered and used in various foreign countries
as well. The "Schwartz" trademark is used by the Registrant in connection
with the sale of the Registrant's products in Europe and the "Club House"
trademark is used in connection with the sale of the Registrant's products
in Canada. The terms of the trademark registrations are as prescribed by
law and the registrations will be renewed for as long as the Registrant
deems them to be useful.
The Registrant has entered into a number of license agreements
authorizing the use of its trademarks by persons in foreign countries.
In the aggregate, the loss of those license agreements would not have a
material adverse impact on the Registrant's business. The terms of the
license agreements are generally 3 to 5 years or until such time as
either party terminates the agreement. Those agreements with specific
terms are renewable upon agreement of the parties.
The Registrant owns various patents, but they are not viewed as material
to the Registrant's business.
SEASONAL NATURE OF BUSINESS
Historically, the Registrant's sales and profits are lower in the first
two quarters of the fiscal year and increase in the third and fourth
quarters.
WORKING CAPITAL
In order to meet increased demand for its products during its fourth
quarter, the Registrant usually builds its inventories during the second
and third quarters. In common with other companies, the Registrant
generally finances working capital items (inventory and receivables)
through short-term borrowings, which include the use of lines of credit
and the issuance of commercial paper. The Registrant's Annual Report to
Stockholders for 1996 sets forth a description of the Registrant's
liquidity and capital resources on pages 41 and 42, which pages are
incorporated by reference.
CUSTOMERS
The Registrant has a large number of customers for its products. No
single customer accounted for as much as 10% of consolidated net sales
in 1996. In the same year, sales to the five largest customers
represented approximately 20% of consolidated net sales.
BACKLOG ORDERS
The dollar amount of backlog orders of the Registrant's business is not
material to an understanding of the Registrant's business, taken as a
whole.
GOVERNMENT CONTRACTS
No material portion of the Registrant's business is subject to
renegotiation of profits or termination of contracts or subcontracts at
the election of the Government.
COMPETITION
Although the Registrant is a leader in sales of certain spices and
seasoning and flavoring products, its business is highly competitive. For
further discussion, see pages 8 through 12, 37 and 39 of the Registrant's
Annual Report to Stockholders for 1996, which pages are incorporated by
reference.
RESARCH AND QUALITY CONTROL
The Registrant has emphasized quality and innovation in the development,
production and packaging of its products. Many of the Registrant's
products are prepared from confidential formulae developed by its
research laboratories and product development departments. The long
experience of the Registrant in its field contributes substantially to
the quality of the products offered for sale. Quality specifications
exist for the Registrant's products, and continuing quality control
inspections and testing are performed. Total expenditures for these and
other related activities during fiscal years 1996, 1995 and 1994 were
approximately $35,705,000, $33,825,000 and $34,050,000 respectively. Of
these amounts, expenditures for research and development amounted to
$12,216,000 in 1996, $12,015,000 in 1995 and $11,162,000 in 1994. The
amount spent on customer-sponsored research activities is not material.
ENVIRONMENTAL REGULATIONS
Compliance with Federal, State and local provisions related to
protection of the environment has had no material effect on the
Registrant's business. No material capital expenditures for
environmental control facilities are expected to be made during this
fiscal year or the next.
EMPLOYEES
The Registrant had on average approximately 8,400 employees during fiscal
year 1996 and approximately 7,300 employees on November 30, 1996.
FOREIGN OPERATIONS
International businesses have made significant contributions to the
Registrant's growth and profits. In common with other companies with
foreign operations, the Registrant is subject in varying degrees to
certain risks typically associated with doing business abroad, such as
local economic and market conditions, exchange and price controls,
restrictions on investment, royalties and dividends and exchange rate
fluctuations.
Note 10 of the Notes to Consolidated Financial Statements on pages 31 and
32 of the Registrant's Annual Report to Stockholders for 1996, and pages 38
through 41 of the Registrant's Annual Report to Stockholders for 1996
contain the information required by subsection (d) of Item 101 of
Regulation S-K, which pages are incorporated by reference.
ITEM 2. PROPERTIES
The location and general character of the Registrant's principal plants
and other materially important physical properties are as follows:
(a) Consumer Products
A plant is located in Hunt Valley, Maryland on approximately 52 acres
in the Hunt Valley Business Community. This plant, which contains
approximately 540,000 square feet, is owned in fee and is used for
processing spices and other food products. There is an approximately
110,000 square foot office building located in Hunt Valley, Maryland which
is the headquarters for the Registrant's Consumer Products division. Also
in Hunt Valley, Maryland is a facility of approximately 100,000 square feet
which contains the Registrant's printing operations and a warehouse. All
of these facilities are owned in fee. A plant of approximately 460,000
square feet and a distribution center of approximately 325,000 square feet
are located in Salinas, California and a plant of approximately 108,000
square feet is located in Commerce, California. These facilities are owned
in fee and used for milling, processing, packaging, and distributing spices
and other food products.
(b) Industrial Products
The Registrant has two principal plants devoted to industrial
flavoring products in the United States. A plant of 105,000 square feet
is located in Hunt Valley, Maryland and is owned in fee. A plant of
102,000 square feet is located in Dallas, Texas and is owned in fee.
(c) Spice Milling
Located adjacent to the consumer products plant in Hunt Valley is a
spice milling and cleaning plant which is owned in fee by the Registrant
and contains approximately 185,000 square feet. This plant services all
food product groups of the Registrant. Much of the milling and grinding
of raw materials for Registrant's seasoning products is done in this
facility.
(d) Packaging Products
The Registrant has three principal plants which are devoted to the
production of plastic products. A plant of approximately 275,000 square
feet is located in Anaheim, California and a plant of approximately 221,000
square feet is located in Easthampton, Massachusetts. Both of these
facilities are owned in fee. A plant of approximately 203,000 square feet
is located in Cranbury, New Jersey and is leased.
(e) International
The Registrant has a plant in London, Ontario which is devoted to the
processing, packaging and distribution of food products. This facility
is approximately 140,000 square feet and is owned in fee. The Registrant
has a new 251,000 square foot facility in Buckinghamshire, England which
contains the Registrant's U.K. headquarters and manufacturing plant for dry
products.
(f) Research and Development
The Registrant has a facility in Hunt Valley, Maryland which houses
the research and development laboratories and the technical capabilities
of the industrial division. The facility is approximately 110,000 square
feet and is owned in fee.
(g) Distribution
The new McCormick Distribution Center in Belcamp, Maryland opened in
March 1996. The leased 369,000 square foot facility handles the
distribution of consumer, food service and industrial products in the
eastern United States.
ITEM 3. LEGAL PROCEEDINGS
There are no material pending legal proceedings to which the Registrant
or any of its subsidiaries is a party or to which any of their property
is subject.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted during the fourth quarter of Registrant's fiscal
year 1996 to a vote of security holders.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
The Registrant has disclosed at page 42 of its Annual Report to
Stockholders for 1996, which page is incorporated by reference, the
information relating to the market, market quotations, and dividends
paid on Registrant's common stocks required by this Item.
The approximate number of holders of common stock of the Registrant
based on record ownership as of January 31, 1997 was as follows:
Approximate Number
Title of Class of Record Holders
Common Stock, no par value 2,000
Common Stock Non-Voting, 9,900
no par value
ITEM 6. SELECTED FINANCIAL DATA
The Registrant has disclosed the information required by this Item in
the line items for 1992 through 1996 entitled "Net Sales," "Net income-
continuing operations," "Earnings per share - Continuing operations,"
"Common dividends declared," Long term debt" and "Total assets" on pages
14-15 of its Annual Report to Stockholders for 1996, which pages are
incorporated by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The Registrant's Annual Report to Stockholders for 1996 at pages 37
through 42 contains a discussion and analysis of the Company's financial
condition and results of operations for the three fiscal years ended
November 30, 1996. Said pages are incorporated by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The financial statements and supplementary data for McCormick & Company,
Incorporated are included on pages 17 through 35 of the Annual Report to
Stockholders for 1996, which pages are incorporated by reference. The
report of independent auditors from Ernst & Young LLP on such financial
statements is included on page 36 of the Annual Report to Stockholders
for 1996; the supplemental schedule for 1994, 1995 and 1996 is included
on page 15 of this Report on Form 10-K.
The unaudited quarterly data required by Item 302 of Regulation S-K is
included in Note 12 of the Notes to Consolidated Financial Statements at
pages 34 and 35 of the Registrant's Annual Report to Stockholders for 1996,
which Note is incorporated by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
No response is required to this Item.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The Registrant has filed with the Commission a definitive copy of its
Proxy Statement dated February 19, 1997, which sets forth the information
required by this Item at pages 3 through 8, which pages are incorporated by
reference. In addition to the executive officers and directors discussed in
the Proxy Statement, J. Allan Anderson and Christopher J. Kurtzman are also
executive officers of the Registrant.
Mr. Anderson is 50 years old and has had the following work experience
during the last five years: 1/92 to present - Vice President and
Controller; 3/91 to 1/92 - President and Chairman of the Board - Golden
West Foods, Inc. (a former subsidiary of the Company); 4/89 to 3/91 -
Vice President - Food Service & Industrial Groups.
Mr. Kurtzman is 44 years old and has had the following work experience
during the last five years: 2/96 to present - Vice President and
Treasurer; 5/94 to 2/96 - Assistant Treasurer-Domestic; 9/90 to 5/94 -
Assistant Treasurer-Investor Relations & Financial Services; 12/89 to 9/90
- - Assistant Treasurer- Financial Services.
ITEM 11. EXECUTIVE COMPENSATION
The Registrant has filed with the Commission a definitive copy of its
Proxy Statement dated February 19, 1997, which sets forth the information
required by this Item at pages 8 through 23, which pages are
incorporated by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The Registrant has filed with the Commission a definitive copy of its
Proxy Statement dated February 19, 1997, which sets forth the information
required by this Item at pages 2 through 7, which pages are incorporated by
reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Registrant has filed with the Commission a definitive copy of its
Proxy Statement dated February 19, 1997, which sets forth the information
required by this Item at pages 9 and 10, which pages are incorporated by
reference.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM
8-K
(a) The following documents are filed as a part of this Form:
1. The consolidated financial statements for McCormick
& Company, Incorporated and subsidiaries which are listed in the Table
of Contents appearing on page 14 below.
2. The financial statement schedules required by Item
8 of this Form which are listed in the Table of Contents appearing on
page 14 below.
3. The exhibits which are filed as a part of this Form
and required by Item 601 of Regulation S-K are listed on the accompanying
Exhibit Index at pages 16 through 18 of this Report.
(b) The Registrant filed one report during the last quarter on
Form 8-K dated September 13, 1996 which reported the Registrant's sale of
the assets of Gilroy Foods, Incorporated and Gilroy Energy Company to
ConAgra Inc. and to an affiliate of Calpine Corporation, respectively.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report on Form
10-K to be signed on its behalf by the undersigned, thereunto duly
authorized.
McCORMICK & COMPANY, INCORPORATED
By:/s/ Robert J. Lawless President, Chief Executive
Robert J. Lawless Officer February 19, 1997
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of
the Registrant and in the capacities and on the dates indicated.
Principal Executive Officer:
/s/ Robert J. Lawless President, Chief Executive
Robert J. Lawless Officer February 19, 1997
Principal Financial Officer:
/s/ Robert G. Davey Executive Vice President &
Robert G. Davey Chief Financial Office February 19, 1997
Principal Accounting Officer:
/s/ J. Allan Anderson Vice President &
J. Allan Anderson Controller February 19, 1997
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons, being a
majority of the Board of Directors of McCormick & Company, Incorporated,
on the date indicated:
THE BOARD OF DIRECTORS: DATE:
/s/ James J. Albrecht February 19, 1997
James J. Albrecht
/s/ James S. Cook February 19, 1997
James S. Cook
/s/ Robert G. Davey February 19, 1997
Robert G. Davey
/s/ Freeman A. Hrabowski, III February 19, 1997
Freeman A. Hrabowski, III
/s/ George W. Koch February 19, 1997
George W. Koch
/s/ Robert J. Lawless February 19, 1997
Robert J. Lawless
/s/ Charles P. McCormick, Jr. February 19, 1997
Charles P. McCormick, Jr.
/s/ George V. McGowan February 19, 1997
George V. McGowan
/s/ Carroll D. Nordhoff February 19, 1997
Carroll D. Nordhoff
/s/ Robert W. Schroeder February 19, 1997
Robert W. Schroeder
/s/ Richard W. Single, Sr. February 19, 1997
Richard W. Single, Sr.
/s/ William E. Stevens February 19, 1997
William E. Stevens
/s/ Karen D. Weatherholtz February 19, 1997
Karen D. Weatherholtz
CROSS REFERENCE SHEET
PART I ITEM REFERENCED MATERIAL/PAGE(S)PART
Item 1. Business Registrant's 1996 Annual Report
to Stockholders/Pages 7-13, 22-
23, 31-32 and 37-42.
Item 2. Properties None.
Item 3. Legal Proceedings None.
Item 4. Submission of None.
Matters to a Vote
of Security Holders.
PART II Item 5. Market for the Registrant's 1996 Annual
Registrant's Common Report to Stockholders/
Equity and Related Page 42.
Stockholder Matters.
Item 6. Selected Financial Registrant's 1996 Annual
Data. Report to Stockholders/Selected
Items on Pages 14-15.
Item 7. Management's Registrant's 1996 Annual
Discussion and Report to Stockholders/Pages
Analysis of 37-42.
Financial Condition
and Results of
Operations.
Item 8. Financial Registrant's 1996 Annual
Statements and Report to Stockholders/Pages
Supplementary 17-35 and 36; Page 15 of this
Data. Report.
Item 9. Changes in and None.
Disagreements with
Accountants on
Accounting and
Financial Disclosure.
PART III Item 10. Directors and Registrant's Proxy Statement
Executive Officers dated February 19, 1997/Pages
of the Registrant. 3-8.
Item 11. Executive Registrant's Proxy Statement
Compensation. dated February 19, 1997/Pages
8-23.
Item 12. Security Ownership Registrant's Proxy Statement
of Certain dated February 19, 1997/Pages
Beneficial Owners 2-7.
and Management.
Item 13. Certain Registrants Proxy Statement
Relationships and dated February 19, 1997/Pages
Related 9-10.
Transactions.
PART IV Item 14. Exhibits, Financial See Exhibit Index on pages 16
Statement Schedules through 18 and the Table of
and Reports on Form Contents at page 14 of this
8-K. Report.
McCORMICK & COMPANY, INCORPORATED
TABLE OF CONTENTS
AND RELATED INFORMATION
Included in the Company's 1996 Annual Report to Stockholders, the
following consolidated financial statements are incorporated by
reference in Item 8*:
Consolidated Balance Sheet, November 30, 1996 and 1995
Consolidated Income Statement for the Years Ended November 30,
1996, 1995 and 1994
Consolidated Statement of Cash Flows for the Years Ended November 30,
1996, 1995 and 1994
Consolidated Statement of Shareholders' Equity for the Years Ended
November 30, 1996, 1995 and 1994
Notes to Consolidated Financial Statements
Report of Independent Auditors
Included in Part IV of This Annual Report:
Supplemental Financial Schedules:
II - Valuation and Qualifying Accounts
Schedules other than those listed above are omitted because of the
absence of the conditions under which they are required or because the
information called for is included in the consolidated financial
statements or notes thereto.
*Pursuant to Rule 12b-23 issued by the Commission under the Securities
Exchange Act of 1934, as amended, a copy of the 1996 Annual Report to
Stockholders of the Registrant for its fiscal year ended November 30,
1996 accompanies this Annual Report on Form 10-K.
SUPPLEMENTAL FINANCIAL SCHEDULE II
CONSOLIDATED
McCORMICK & COMPANY, INCORPORATED
VALUATION AND QUALIFYING ACCOUNTS
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
BALANCE ADDITIONS
AT CHARGED TO BALANCE
BEGINNING COSTS AND AT END
DESCRIPTION OF YEAR EXPENSES DEDUCTIONS OF YEAR
YEAR ENDED NOVEMBER 30, 1996
Allowance for doubtful
receivables....... $2,545,000 $1,713,000 $731,000 (F1) $3,527,000
YEAR ENDED NOVEMBER 30, 1995
Allowance for doubtful
receivables....... $2,520,000 $654,000 $629,000 (F1) $2,545,000
YEAR ENDED NOVEMBER 30, 1994
Allowance for doubtful
receivables....... $2,530,000 $1,132,000 $1,142,000 (F1) $2,520,000
(F1) Accounts written off net of recoveries.
Exhibit Index
Item 601
Exhibit
Number Reference or Page
(2) Plan of acquisition,
reorganization, arrangement,
liquidation or succession Not applicable.
(3) Articles of Incorporation
and By-Laws
Restatement of Charter of Incorporated by reference from
McCormick & Company, Registration Form S-8, Registration
Incorporated dated Statement No. 33-39582 as filed
April 16, 1990. with the Securities and Exchange
Commission on March 25, 1991.
Articles of Amendment to Incorporated by reference
Charter of McCormick & Company, from Registration Form S-8,
Incorporated dated April 1, Registration Statement No.
1992. 33-59842 as filed with the
Securities and Exchange
Commission on March 19,
1993.
By-laws of McCormick & Company Incorporated by reference from
Incorporated-Restated and Amended Registrant's Form 10-Q for the
as of June 17, 1996. quarter ended May 31, 1996 as
filed with the Securities and
Exchange Commission on July 12,
1996.
(4) Instruments defining the rights of With respect to rights of
security holders, including securities, see Exhibit 3
indentures. (Restatement of Charter). No
instrument of Registrant with
respect to long-term debt
involves an amount of
authorized securities which
exceeds 10 percent of the
total assets of the Registrant
and its subsidiaries on a
consolidated basis. Registrant
agrees to furnish a copy of any
such instrument upon request of
the Commission.
(9) Voting Trust Agreement. Not applicable.
(10) Material contracts.
i) Registrant's supplemental pension plan for certain senior officers
is described in the McCormick Supplemental Executive Retirement
Plan, a copy of which was attached as Exhibit 10.1 to the
Registrant's Report on Form 10-K for the fiscal year 1992
as filed with the Securities and Exchange Commission on February
17, 1993, which report is incorporated by reference.
ii) Stock option plans, in which directors, officers and certain
other management employees participate, are described in the
Registrant's S-8 Registration Statements Nos. 33-33725 and
33-58197 filed with the Securities and Exchange Commission on
March 2, 1990 and March 23, 1995 respectively, which statements
are incorporated by reference.
iii) Consulting letter agreement between Registrant and Charles
P. McCormick, Jr. dated February 14, 1996, which letter is
incorporated by reference from Registrant's Form 10-Q dated
April 12, 1996.
iv) Asset Purchase Agreement among the Registrant, Gilroy Foods, Inc.
and ConAgra, Inc. dated August 28, 1996 which agreement is
incorporated by reference from Registrant's Report on Form 8-K
as filed with the Securities and Exchange Commission on September
13, 1996.
v) Asset Purchase Agreement among the Registrant, Gilroy Energy
Company, Inc. and Calpine Gilroy Cogen, L.P., dated August 28,
1996 which agreement is incorporated by reference from
Registrant's Report on Form 8-K as filed with the Securities
and Exchange Commission on September 13, 1996.
(11) Statement re computation of per- Page 19 of this Report on
share earnings. Form 10-K.
(12) Statements re computation of ratios. Page 42 of Exhibit 13.
(13) Annual Report to Security Holders
McCormick & Company, Incorporated Submitted in electronic format.
Annual Report to Stockholders for
1996.
(16) Letter re change in certifying Not applicable.
accountant.
(18) Letter re change in accounting Not applicable.
principles.
(21) Subsidiaries of the Registrant Page 44 of Exhibit 13.
(22) Published report regarding matters Not applicable.
submitted to vote of securities holders
(23) Consent of independent auditors Page 20 of this Report on
Form 10-K.
(24) Power of attorney Not applicable.
(27) Financial Data Schedule Submitted in electronic
format only.
(99) Additional exhibits Registrant's definitive
Proxy Statement dated
February 19, 1997.
McCormick and Company, Inc. Part I - Exhibit 11
(In Thousands Except Per Share Amounts)
Statement re Computation of Per-Share Earnings* Year Ended November 30
Computation for Statement of Income 1996 1995 1994
Net Income $41,918 $97,521 $61,157
Reconciliation of Weighted Average Number of
Shares Outstanding to Amount used in Primary
Earnings Per Share Computation
Weighted Average Number of Shares Outstanding 80,641 81,181 81,240
Add - Dilutive Effect of Outstanding Options
(as Determined by the Application of the
Treasury Stock Method) (F1) 61 138 391
Weighted Average Number of Shares Outstanding
As Adjusted for Equivalent Shares 80,702 81,319 81,631
PRIMARY EARNINGS PER SHARE $0.52 $1.20 $0.75
Year Ended November 30
Computation for Statement of Income 1996 1995 1994
Reconciliation of Weighted Average Number of
Shares Outstanding to Amount used in Fully Diluted
Earnings Per Share Computation
Weighted Average Number of Shares Outstanding 80,641 81,181 81,240
Add - Dilutive Effect of Outstanding Options
(As Determined by the Application of the
Treasury Stock Method) (F1) 98 159 391
Weighted Average Number of Shares Outstanding
As Adjusted for Equivalent Shares 80,739 81,340 81,631
FULLY DILUTED EARNINGS PER SHARE $0.52 $1.20 $0.75
*See 1996 Annual Report, Note (1) of the Notes to Financial Statements.
(F1) "This calculation is submitted in accordance with Regulation S-K item
601(b)(11) although not required by footnote 2 to paragraph 14 of APB
Opinion No. 15 because it results in dilution of less than 3%."
Exhibit 23 -- CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Annual Report (Form
10-K) of McCormick & Company, Incorporated and subsidiaries of our report
dated January 16, 1997, included in the 1996 Annual Report to Shareholders
of McCormick & Company, Incorporated.
Our audits also included the financial statement schedule of McCormick &
Company, Incorporated and subsidiaries listed in Item 14(a). This schedule
is the responsibility of the Company's management. Our responsibility is to
express an opinion based on our audits. 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 set forth therein.
We also consent to the incorporation by reference in the following
Registration Statements of McCormick & Company, Incorporated and
subsidiaries and in the related Prospectuses (if applicable) of our report
dated January 16, 1997, with respect to the consolidated financial
statements and schedule of McCormick & Company, Incorporated and
subsidiaries included in the 1996 Annual Report to Shareholders and
incorporated by reference in this Annual Report (Form 10-K) for the year
ended November 30, 1996.
Form Registration Number Date Filed
S-8 33-58197 3/23/95
S-3 33-66614 7/27/93
S-3 33-40920 6/18/91
S-3 33-40920 5/29/91
S-8 33-33724 3/2/90
S-8 33-33725 3/2/90
S-3 33-32712 12/21/89
S-8 33-24660 3/16/89
S-3 33-24959 9/15/88
S-8 33-24658 9/15/88
Ernst & Young LLP
Baltimore, Maryland
February 21, 1997