Back to GetFilings.com
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(MARK ONE)
( x ) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934 (Fee Required)
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1993
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934 (No Fee Required)
FOR THE TRANSITION PERIOD FROM _________ TO ____________
COMMISSION FILE NUMBER 0-6430
OWENS & MINOR, INC.
(Exact name of Registrant as specified in its charter)
VIRGINIA 54-0327460
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4800 COX ROAD
GLEN ALLEN, VIRGINIA 23260
(Address of principal executive offices) (Zipcode)
(804) 747-9794
(Registrant's telephone number, including area code)
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
Name of each exchange
Title of each class on which registered
Common Stock, $2 par value New York Stock Exchange, Inc.
Preferred Stock Purchase Rights New York Stock Exchange, Inc.
Securities registered pursuant to Section 12(g) of the Act:
NONE
(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 any definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. ( )
The aggregate market value of Common Stock held by non-affiliates (based
upon the closing sales price) was approximately $448,061,094 as of March 4,
1994. In determining this figure, the Company has assumed that all of its
officers, directors and persons known to the Company to be the beneficial
owners of more than five percent of the Company's Common Stock are affiliates.
Such assumptions shall not be deemed conclusive for any other purpose.
The number of shares of the Company's Common Stock outstanding as of March
4, 1994 was 20,396,601 shares.
DOCUMENTS INCORPORTED BY REFERNCE
Portions of the Owens & Minor, Inc. Annual Report to Stockholders for the
year ended December 31, 1993 (the "1993 Annual Report") are incorporated by
reference into Part II of this Form 10-K and portions of the Owens & Minor,
Inc. definitive Proxy Statement/Prospectus for the 1994 Annual Meeting of
Shareholders (the "1994 Proxy Statement") are incorporated by reference into
Part III of this Form 10-K. With the exception of the specified information
referred to in Items 5, 6, 7, 8 and 14 hereof, the 1993 Annual Report is not
deemed to be filed as a part of this report.
TABLE OF CONTENTS
and
CROSS REFERENCE SHEET
Page
Number(s)/Sections
- --------------------------------------
Form Annual
Proxy
10-K Report
Statement
---- ------
- ---------
PART I
Item 1 Business 2-5
Item 2 Properties 6
Item 3 Legal Proceedings 6
Item 4 Submission of Matters to a Vote of Security Holders 6
PART II
* Item 5 Market for Registrant's Common Equity and
Related Stockholder Matters 10 Inside Back Cover
* Item 6 Selected Financial Data 10 18-19
* Item 7 Management's Discussion and Analysis of
Financial Condition and Results of Operations 10 18-21
* Item 8 Financial Statements and Supplementary Data 10 22-37
Item 9 Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure 10
PART III
** Item 10 Directors and Executive Officers of the Registrant 11
Proposal 2:
Election of Directors
** Item 11 Executive Compensation 11
Proposal 2:
Election of Directors
- - Executive Compensation
** Item 12 Security Ownership of Certain Beneficial
Proposal 2:
Owners and Management 11
Election of Directors
- - O&M Common Stock
Owned by Principal
Shareholders and
Management
** Item 13 Certain Relationships and Related Transactions 11
Proposal 2:
Election of Directors
- - Compensation Committee
Interlocks and Insider
Participation
PART IV
Item 14 Exhibits, Financial Statement Schedules, and 12-14
Reports on Form 8-K
* Information related to this item is hereby incorporated by reference to
the 1993 Annual Report.
** Information related to this item is hereby incorporated by reference to
the 1994 Proxy Statement.
FORM 10-K
OWENS & MINOR, INC.
PART I
Item 1. Business
Owens & Minor, Inc. (the "Company") was incorporated in Virginia on
December 7, 1926 as a successor to a partnership founded in Richmond,
Virginia in 1882. The Company is a wholesale distributor of medical/surgical
supplies and carries over 104,000 products and operates 36 distribution
centers serving hospitals, nursing homes, alternate medical care facilities
and other institutions nationwide. The Company also distributes
pharmaceuticals and other products to independent pharmacies and chain drug
stores in south Florida. The Company's common stock is traded on the New
York Stock Exchange under the symbol OMI.
On December 22, 1993, the Company entered into an agreement with Stuart
Medical, Inc. (Stuart) whereby the companies will combine their two
businesses. Stuart, a distributor of medical/surgical supplies, has
distribution centers located primarily in the West, Midwest and Northeast and
had sales for the year ended December 31, 1993 of $890.5 million (unaudited).
In the proposed transaction, the Company will form a holding company that
will own all of the currently outstanding capital stock of the Company and
Stuart. Under the terms of the agreement, the new holding company would
exchange $40,200,000 in cash and $115,000,000 par value of convertible
preferred stock for all of the capital stock of Stuart. The Company will
also refinance Stuart's pro forma debt of $141,000,000 (unaudited). Each
outstanding share of the Company's common stock would be exchanged for one
share of common stock of the new holding company. The Company intends to
account for this transaction as a purchase, if consummated. The Board of
Directors of the Company and the requisite shareholders of Stuart have
unanimously approved this transaction. The Company's shareholders will vote
on the proposed transaction at the annual shareholders' meeting with expected
closing of the transaction to occur in the second quarter.
In 1993, the Company did not engage in any material amount of governmental
business that may be subject to renegotiation of profits or termination of
contract at the election of the government. The Company held no material
patents, trademarks, licenses, franchises or concessions in 1993 nor is it
subject to any material seasonality. At December 31, 1993, the Company had
1,674 full and part-time employees and considers its relations with them to
be excellent.
The Company is required to carry a significant investment in inventory to
meet the rapid delivery requirements of its customers. The Company sells
only finished goods purchased from approximately 1,650 different competing
manufacturers that provide an adequate availability of inventory. In 1993,
products purchased from Johnson & Johnson, Inc. accounted for more than 19%
of the Company's net sales. The Company believes that it is not vulnerable
to supply interruptions that would have a material adverse effect on its
operations or profitability. Due to the immediate delivery requirements of
its customers, the Company has no material backlog of orders.
During 1993, hospital customers (including members of hospital buying
groups) represented 90% of the Company's sales. The remaining sales were to
nursing homes, physicians and other purchasers. The high percentage of
sales to hospitals reflects the principal strategy to concentrate on hospital
customers in the belief that hospitals will remain the primary focus of the
healthcare industry. Important elements of this strategy have been to
maintain the Company's status as a low cost distributor of high volume
disposable, commodity products and to operate in a decentralized manner to
provide customers with a high level of service on a local basis.
In 1993, the majority of the Company's net sales were related to eight
product groups - urological products, dressings, needles and syringes,
surgical packs and gowns, sterile procedure trays, sutures, intravenous
products and endoscopic products. These products are disposable and are
generally used in high volume by customers. The sales of these products are
supplemented by sales of a wide variety of other products including
incontinence products, feeding tubes, surgical staples, blood collection
devices and surgical gloves.
The Company's growth has been achieved by expansion into new geographical
areas through acquisitions, the opening of new distribution centers and the
consolidation of existing distribution centers. In May 1989, the Company
acquired National Healthcare and Hospital Supply Corporation (National
Healthcare). With the addition of National Healthcare's six continuing
distribution centers, the Company was able to expand its distribution area to
the western portion of the United States. On December 2, 1991, the Company
acquired Koley's Medical Supply, Inc. (Koley's). The acquisition of Koley's
provided the Company with three distribution centers located in Iowa and
Nebraska. In May 1992 and September 1992, the Company opened distribution
centers in Columbus, Ohio and Memphis, Tennessee, respectively. In May 1993,
the Company acquired Lyons Physician Supply Company located in Youngstown,
Ohio. In June 1993, the Company acquired A. Kuhlman & Co. located in
Detroit, Michigan. In June 1993, the Company opened distribution centers in
Birmingham, Alabama and Detroit, Michigan, and in August 1993 and December
1993, the Company opened distribution centers in Boston, Massachusetts and
Seattle, Washington, respectively. The Company intends to continue to
acquire or establish facilities in new locations depending on the
attractiveness of new markets, the availability of suitable acquisition
candidates and the potential for additional sales or cost savings from new
locations.
Since 1985, the Company has been a distributor for Voluntary Hospitals of
America, Inc. ("VHA"). The Company entered into a new supply agreement with
VHA in November 1993. VHA is the nation's largest non-profit hospital
system, representing over 960 hospitals, approximately 370 of which are in
markets serviced by the Company.
Under the provisions of the new VHA agreement, commencing on April 1, 1994,
the Company will sell products to VHA-member hospitals and affiliates on a
variable cost-plus basis that is generally dependent upon dollar volume of
purchases and percentage of total products purchased from the Company.
Accordingly, as the Company's sales to and penetration of VHA-member
customers increase, the cost plus pricing charged to such customers
decreases. Prior to April 1, 1994, products were sold on a straight cost-
plus basis. During 1993, no single customer accounted for 10% or more of the
Company's sales, except for sales under the VHA agreement to member
hospitals, which amounted to approximately $460 million or 33% of the
Company's total net sales.
In February 1994, the Company was selected by Columbia/HCA Healthcare Corp.
("Columbia/HCA") as its prime distributer for medical/surgical products.
Columbia/HCA operates 192 acute care and specialty hospitals throughout the
United States.
The Company also acts as an agent for Abbott Laboratories, warehousing and
distributing intravenous solutions and related products on a fee basis at six
distribution centers.
CUSTOMER SERVICE AND MARKETING SYSTEMS
The Company believes that its increased use of computers will continue to
improve its inventory management and its ability to provide prompt delivery
to customers. The use of computers has enabled the Company to handle an
increasing level of sales without corresponding increases in personnel.
Since 1988, the Company has utilized its Owens & Minor Network Information
System (OMNI), a fully integrated on-line system that operates from a
centralized data base. OMNI has improved operating controls and provided
more consistent information from the distribution centers. Additionally, the
OMNI system has improved the Company's ability to communicate with and
service its customers.
The second phase of the OMNI implementation provides for the installation
of a new computer-oriented warehouse management system, which includes a
state-of-the-art radio frequency control system utilizing barcodes that
interface with the mainframe computer system. This system completely
computerizes on-line the receiving, putaway, storage, verification, order
picking and shipping of merchandise. One of the benefits of the system is
that it provides for periodic recounts of merchandise, which will improve the
accuracy of on-hand product inventory data. Through 1993, this new warehouse
management system has been implemented in 18 of the Company's 36 distribution
centers.
During 1992, the Company began an investment in resources to upgrade the
OMNI system in order to service its customers more effectively. Selected
employees within the information systems department are utilizing the latest
application development techniques including Computer Aided System
Engineering (CASE).
The Company offers its customers certain systems-related services which
management believes contribute to its competitive position. The Company has
a variety of electronic order entry systems which allow its sales
representatives and customers to enter orders directly into the Company's
computer. These systems can interface with existing customer materials
management systems and with hand-held microcomputers carried by sales
representatives to transmit orders. During 1993, approximately 63% of the
Company's sales were entered through these systems.
Electronic order entry systems have enabled the Company to reduce its order
processing costs and improve customer service. Customers with compatible
computer terminals or computerized materials management systems can enter
orders directly into the mainframe computer in Richmond using their own
product numbering system. The Company has also adapted its central computer
system in Richmond to receive computer-to-computer order transmissions from
several more comprehensive material management software systems used by
certain customers. The customer has the choice of using its own product
numbering system or the Company's standard numbering system.
MARKETING DEVELOPMENTS
Under the name of PANDAC(R) services, the Company markets wound closure
inventory management and cost control programs for use in acute care
hospitals. This system aids in budget forecasting and control, both in terms
of balance sheet and profit and loss applications.
In 1993, the Company introduced SPECTROM(TM), an instrument-scope repair
service for the cost conscious healthcare provider. The SPECTROM(TM) service
was designed to be a single source for both major and minor repairs, offering
the customer quality repair, quick turnaround time and economy. SPECTROM(TM)
can reduce the hospital's instrument-scope repair cost which offers the
customer valuable quality performance at the lowest possible cost.
In 1993, the Company introduced CARDIOM(TM), an inventory and cost
management service for the angio Cath Lab. CARDIOM(TM) can significantly
reduce the hospital's Cath Lab asset investment. As part of the service
provided by CARDIOM(TM), the hospital receives quarterly reports containing
data which assists the hospital in maintaining efficient inventories and
controlling procedure product costs.
In 1993, the Company introduced Pallet Architecture Location Services
(PALS(TM)), a service designed to reduce the customers operating costs by
palletizing customer orders to facilitate the receiving process and reduce
put-away time.
LOGISTIC SERVICES
Due to changing needs in the marketplace, the Company's Logistic Support
Services developed a Quality Management Process (QMP) to provide customized
services and solutions. The objective of QMP is to provide hospital
customers with the solutions needed to manage their business through an era
of increasing costs and shrinking reimbursements, with the underlying goal of
providing the lowest delivered cost to the patient.
The QMP Continuum offers steps to help the customer move from a traditional
to a non-traditional distribution environment, defined by the specific needs
of each hospital. The QMP Continuum is comprised of four basic components:
(1) Process Documentation identifies quality improvement opportunities to
remove redundancies, reduce inefficiency, and introduce a continuous
improvement process; (2) Asset Management Solution provides EDI transactions,
continuous inventory replenishment, J-I-T/Stockless partnerships, PANDAC(R)
Wound Closure Management Program and other asset management programs; (3)
Cost Control Analysis provides data needed to identify asset utilization,
streamline and reduce costs, including PALS(TM); and (4) Project Management and
Consulting Services provide operating system design, distribution system
design, facility design, space utilization, Cath Lab design, mergers and
consolidations, etc.
The Quality Management Process methodology is integrated into the
operations of the local Owens & Minor Distribution Center which serves the
hospital.
COMPETITION
The medical/surgical supply business in the United States consists of one
nationwide distributor, Baxter International, and a number of regional and
local distributors. The Company believes that, based upon sales, it is the
second largest distributor of medical/surgical products to hospitals in the
United States. Competition within the medical/surgical supply business
exists with respect to product availability, delivery time, services
provided, the ability to meet special requirements of customers and price.
In recent years, there has been a consolidation of medical/surgical supply
distributors through the purchase of smaller distributors by larger
companies.
Item 2. Properties
The corporate headquarters of the Company are located in western Henrico
County in suburban Richmond, Virginia in a leased facility. The Company
owns two undeveloped parcels of land in western Henrico County, which are
adjacent to the Company's corporate headquarters. The former office and
production facilities of Harbor Medical, Inc., located in Sanford, Florida,
which are presently leased to a tenant through May 1996, are owned by the
Company. Also, with the acquisition of Lyons Physician Supply Company, the
Company owns the land and building of its Youngstown, Ohio location.
The Company also leases offices and warehouses for its distribution centers
in 35 cities throughout the country.
Excluding the Stuart transaction, the Company expects to relocate or
renovate up to seven of its leased office and warehouse facilities in 1994.
All other Company facilities are considered adequate for their current and
projected use.
Item 3. Legal Proceedings
There are no legal proceedings pending against the Company or any of its
subsidiaries other than ordinary routine litigation incidental to its
business, including certain tort claims arising in the ordinary course of
business which are adequately covered by insurance and are being defended
either by the Company's insurance carriers or the suppliers of the
merchandise involved. No legal proceeding pending against the Company is
expected to have a material adverse effect upon the Company.
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of security holders during the fourth
quarter of 1993.
EXECUTIVE AND OTHER OFFICERS OF THE REGISTRANT
The Company's Executive Officers are:
Name Age Office Held
---- --- -----------
G. Gilmer Minor, III 53 President and Chief Executive Officer
Robert E. Anderson, III 59 Senior Vice President, Planning and
Development
Henry A. Berling 51 Senior Vice President, Sales and
Marketing
Drew St. J. Carneal 55 Senior Vice President, Corporate
Counsel and Secretary
Glenn J. Dozier 43 Senior Vice President, Finance, Chief
Financial Officer
Craig R. Smith 42 Senior Vice President, Distribution
and Information Systems
The Company's Other Officers are:
Richard F. Bozard 47 Vice President, Treasurer
Richard L. Farinholt 55 Vice President, Technology Systems
Hugh F. Gouldthorpe, Jr. 55 Vice President, Quality and
Communications
Frederick R. Ricker 48 Vice President, Business Development
and Support
Michael L. Roane 39 Vice President, Human Resources
F. Thomas Smiley 38 Vice President, Controller
Hue Thomas, III 55 Vice President, Corporate Relations
All of the Officers were elected at the annual meeting of the Board of
Directors held April 27, 1993. All Officers are elected to serve until the
1994 Annual Meeting of Shareholders, or such time as their successors are
elected.
Mr. G. Gilmer Minor, III was first employed by the Company in 1963. Mr.
Minor received his B.A. from the Virginia Military Institute in 1963. In
1966, he was awarded an MBA from the Colgate Darden School of Business
Administration from the University of Virginia. He has spent his entire
business career with the Company and was elected President in 1981 and Chief
Executive Officer in 1984.
Mr. Anderson was Vice President of Powers & Anderson from 1958 to 1966.
With the Company's acquisition of Powers & Anderson in 1967, Mr. Anderson
was employed in the Medical/Surgical Division in sales and marketing and was
elected Vice President in 1981. In October 1987, he was elected Senior Vice
President, Corporate Development. In April 1991, Mr. Anderson was elected
Senior Vice President, Marketing and Planning. In 1992, Mr. Anderson assumed
a new role as Senior Vice President, Planning and Development. Mr. Anderson
received a B.S. in Commerce from the University of Virginia in 1955.
Mr. Berling was employed by A & J Hospital Supply Company following the
completion of his education in 1965. With the Company's acquisition of A &
J Hospital Supply in 1966, Mr. Berling was employed by the Company in the
Medical/Surgical Division and was elected Vice President in 1981 and Senior
Vice President, Sales and Marketing, a newly created position, in 1987. In
April 1989, he was elected Senior Vice President and Chief Operating Officer.
In April 1991, Mr. Berling assumed a new role as Senior Vice President, Sales
and Distribution. In 1992, Mr. Berling assumed the role of Senior Vice
President, Sales and Marketing. Mr. Berling received a B.S. in Economics
from Villanova University in 1965.
Mr. Carneal was employed by the Company in January 1989 as Vice President
and Corporate Counsel. From 1985 to 1988, he served as the Richmond City
Attorney and, prior to that date, he was a partner for the law firm of
Cabell, Moncure and Carneal which provided legal services to the Company. In
February 1989, he was elected Secretary by the Board of Directors. In March
1990, he was elected Senior Vice President, Corporate Counsel and Secretary.
Mr. Carneal received a B.A. in English from Princeton University in 1960.
Mr. Carneal received his L.L.B. at the University of Virginia School of Law.
Mr. Dozier was elected to the position of Senior Vice President, Chief
Financial Officer, in February 1991. In April 1991, he assumed the
additional responsibility of Senior Vice President, Operations and Systems.
Mr. Dozier was formerly Vice President, Treasurer and Chief Financial
Officer. In 1992, Mr. Dozier assumed a new role of Senior Vice President,
Finance and Information Systems and Chief Financial Officer. In 1993, Mr.
Dozier assumed the role of Senior Vice President, Finance, Chief Financial
Officer. Prior to joining the Company in April 1990, Mr. Dozier had been
Chief Financial Officer and Vice President of Administration and Control
since 1987 for AMF Bowling, Inc. Previously, Mr. Dozier was with Dravo
Corporation, where his last position was Vice President, Finance. Mr. Dozier
received an MBA from The Colgate Darden School of Business at the University
of Virginia and received a B.S. from Virginia Polytechnic Institute and State
University in Industrial Engineering and Operations Research.
Mr. Smith was employed by National Healthcare and Hospital Supply
Corporation in June 1983 as a sales representative. With the Company's
acquisition of National Healthcare and Hospital Supply Corporation in May
1989, Mr. Smith was employed by the Company as Division Vice President. From
1990 to 1992, Mr. Smith served as Group Vice President for the western
region. On January 4, 1993 Mr. Smith assumed responsibilities of Senior Vice
President, Distribution. In 1993, Mr. Smith assumed the new role of Senior
Vice President, Distribution and Information Systems. Mr. Smith is a
graduate of the University of Southern California.
Mr. Bozard was employed by the Company in March 1988 and was elected Vice
President, Treasurer in 1991. Prior to joining the Company, he served as an
officer for CIT/Manufacturers Hanover Bank and Trust. From 1984 to 1986 he
was with Williams Furniture where his last position was President. Mr.
Bozard received a B.S. from Virginia Commonwealth University in Business
Administration.
Mr. Farinholt was employed by the Company in October 1991 as Vice
President, Information Systems. In January 1994, Mr. Farinholt assumed the
position of Vice President, Technology Systems. Prior to joining the
Company, Mr. Farinholt was President of a consulting firm, Information
Technology Group, Inc. Prior thereto, he was President of HealthNet, Inc.
Previously, Mr. Farinholt was with IBM for 17 years. Mr. Farinholt received
a B.S. Degree in Accounting from the University of Virginia.
Mr. Gouldthorpe joined the Company in 1986 as Director of Hospital Sales
for the Wholesale Drug Division. In 1987, he was promoted to Vice President
and was named Vice President and General Manager of the Wholesale Drug
Division in 1989. In April 1991, he was elected Vice President, Corporate
Communications and in September 1993, was appointed Vice President, Quality
and Communications. Prior to joining the Company, Mr. Gouldthorpe was
employed by E.R. Squibb and Sons for 20 years. While at Squibb he held
numerous sales and marketing positions that included Advertising Manager,
Director of Training and Director of Sales. Mr. Gouldthorpe is a graduate of
The Virginia Military Institute with a B.A. in Chemistry and Biology.
Mr. Ricker was employed by the Company in March 1989 as Vice President and
Director of Operations. In 1991, Mr. Ricker assumed the additional
responsibility of Vice President, Support Services. In 1993, Mr. Ricker
assumed the position of Vice President, Business Development and Support.
Prior to joining the Company, he was Director of Operations with Grinnell
Corporation from 1986 to 1989. Prior to 1986, Mr. Ricker served as Director
and/or Vice President of Operations with John Portman and Associates and W.
W. Grainger, Inc. He started his career with IBM in 1968 as a Financial
Analyst. Mr. Ricker is a graduate of Youngstown State University.
Mr. Roane was employed by the Company in October 1992 as Vice President,
Human Resources. Prior to joining Owens & Minor, Mr. Roane was employed by
Philip Morris Co. where his last position was Manager, Employee Relations
Operations. Mr. Roane received his B.S. Degree in Business Management from
Canisius College.
Mr. Smiley was employed by the Company in September 1979 as Manager of
Internal Audit. In January 1981, he became the Assistant Controller. In
June 1985, he became the Controller. In April 1986 he was elected Assistant
Vice President, Controller. In April 1989, he was elected Vice President,
Controller. Prior to joining the Company, he was with Coopers & Lybrand,
where his last position was Senior Accountant. Mr. Smiley received a B.S. in
Business Administration from the University of Richmond.
Mr. Thomas joined the Company in 1970. In 1984, he was promoted to
Assistant General Manager of the Medical/Surgical Division. In 1985, he was
made Assistant Corporate Vice President and was named Vice President in 1987.
In 1989, he was named Vice President and General Manager of the
Medical/Surgical Division. In 1991, he was named Vice President, Corporate
Relations. Mr. Thomas received a B.S. from Georgia Institute of Technology
in 1964.
PART II
Item 5. Market for Registrant's Common Equity and Related Stockholder
Matters
Information regarding the market price of the Company's Common Stock and
related stockholder matters is set forth in the 1993 Annual Report under the
heading "Market and Dividend Information" on page 40 and is incorporated by
reference herein.
Item 6. Selected Financial Data
The information required under this item is contained in the 1993 Annual
Report under the heading "Selected Financial Data" on pages 18 and 19 and is
incorporated by reference herein.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
The information required under this item is contained in the 1993 Annual
Report under the heading "Management's Discussion and Analysis of Results of
Operations and Financial Condition" on pages 18 through 21 and is
incorporated by reference herein.
Item 8. Financial Statements and Supplementary Data
The consolidated financial statements and notes as of December 31, 1993 and
1992 and for each of the years in the three-year period ended December 31,
1993, together with the independent auditors' report of KPMG Peat Marwick
dated February 4, 1994, appearing on pages 22 through 37 of the 1993 Annual
Report are incorporated by reference herein.
The information required under Item 302 of Regulation S-K is set forth in
the 1993 Annual Report in Note 12 - "Quarterly Financial Data (Unaudited)"
in the Notes to the Consolidated Financial Statements on page 36 and is
incorporated by reference herein.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
There were no changes in or disagreements with accountants on accounting
and financial disclosures during the two years ended December 31, 1993.
PART III
Item 10. Directors and Executive Officers of the Registrant
The information required for this item is contained in Part I of this
report and in the 1994 Proxy Statement under the heading, "Proposal 2:
Election of Directors."
Item 11. Executive Compensation
The information required under this item is contained in the 1994 Proxy
Statement under the heading "Proposal 2: Election of Directors - Executive
Compensation" and is incorporated by reference herein.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The information required under this item is contained in the 1994 Proxy
Statement under the heading "Proposal 2: Election of Directors - O&M Common
Stock Owned by Principal Shareholders and Management" and is incorporated by
reference herein.
Item 13. Certain Relationships and Related Transactions
The information required under this item is contained in the 1994 Proxy
Statement under the heading "Proposal 2: Election of Directors -
Compensation Committee Interlocks and Insider Participation" and is
incorporated by reference herein.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
Page Numbers
1993 Annual Form
Report * 10-K
----------- -----
(a) The following documents are filed as part of this report:
1. Consolidated Financial Statements:
Independent Auditors' Report of KPMG Peat Marwick 37
Consolidated Balance Sheets at December 31, 23
1993 and 1992
Consolidated Statements of Income for the 22
years ended December 31, 1993, 1992 and 1991
Consolidated Statements of 24
Stockholders' Equity for the years
ended December 31, 1993, 1992 and 1991
Consolidated Statements of Cash Flows 25
for the years ended December 31, 1993, 1992 and 1991
Notes to Consolidated Financial Statements 26-36
2. Financial Statement Schedules:
Independent Auditors' Report of KPMG Peat Marwick 16
VIII - Valuation and Qualifying Accounts 17
IX - Short-term and Revolving Credit Borrowings 18
* Incorporated by reference from the indicated pages of the 1993 Annual
Report.
All other schedules are omitted because the related information is included
in the consolidated financial statements or notes thereto or because they are
not applicable.
3. Exhibits
(2) Agreement of Exchange dated as of December 22, 1993
by and among Stuart Medical, Inc., the Company, OMI
Holding, Inc. and certain shareholders of Stuart
Medical, Inc.**
(3) (a) Amended and Restated Articles of Incorporation of
the Company (incorporated herein by reference to
the Company's Annual Report on Form 10-K, Exhibit
3(a), for the year ended December 31, 1990)
(b) Amendment effective March 8, 1993 to the Amended
and Restated Articles of Incorporation of the
Company (incorporated herein by reference to the
Company's Annual Report on Form 10-K, exhibit 3(b),
for the year ended December 31, 1992)
(c) Bylaws of the Company as amended on February 25,
1993 (incorporated herein by reference to the
Company's Annual Report on Form 10-K, Exhibit 3(c),
for the year ended December 31, 1992)
(4) (a) Owens & Minor, Inc. $11.5 million, 0% subordinated
note dated May 31, 1989, due May 31, 1997, between
the Company and Hygeia Ltd. (incorporated herein by
reference to the Company's Annual Report on Form
10-K for the year ended December 31, 1990)
(b) Owens & Minor, Inc. $3.5 million, 6.5% convertible
subordinated debenture dated May 31, 1989, between
the Company and Hygeia Ltd. (incorporated herein
by reference to the Company's Annual Report on Form
10-K for the year ended December 31, 1990)
(c) Owens & Minor, Inc. $40 million Credit Agreement,
dated as of November 1, 1993, among the Company and
Crestar Bank and NationsBank of Virginia, N.A.
(10) (a) Owens & Minor, Inc. Annual Incentive Plan
(incorporated herein by reference to the Company's
definitive Proxy Statement dated March 25, 1991)*
(b) 1985 Stock Option Plan as amended on January 27,
1987 (incorporated herein by reference to the
Company's Annual Report on Form 10-K, Exhibit
10(f), for the year ended December 31, 1987)*
(c) Stock Purchase Agreement dated May 1, 1989 among
the Company, Hygeia N.V. and Hygeia Medical Supply
B.V. (incorporated herein by reference to the
Company's Current Report on Form 8-K, Exhibit 2.1,
filed on May 24, 1989)
(d) Owens & Minor, Inc. Pension Plan (incorporated
herein by reference to the Company's Annual Report
on Form 10-K, Exhibit 10(h), for the year ended
December 31, 1990)*
(e) Supplemental Executive Retirement Plan dated July
1, 1991 (incorporated herein by reference to the
Company's Annual Report on Form 10-K, Exhibit
10(i), for the year ended December 31, 1991)*
(f) Owens & Minor, Inc. Executive Severance Agreements
(incorporated herein by reference to the Company's
Annual Report on Form 10-K, Exhibit 10(i), for the
year ended December 31, 1991)*
(g) Owens & Minor, Inc. Directors' Stock Option Plan
(incorporated herein by reference to the Company's
Annual Report on Form 10-K, Exhibit 10(i), for the
year ended December 31, 1991)*
(h) Agreement dated December 31, 1985 by and between
Owens & Minor, Inc. and G. Gilmer Minor, Jr.
(incorporated herein by reference to the Company's
Annual Report on Form 10-K, exhibit 10(k), for the
year ended December 31, 1992)*
(i) Agreement dated December 31, 1985 by and between
Owens & Minor, Inc. and Philip M. Minor
(incorporated herein by reference to the Company's
Annual Report on Form 10-K, exhibit 10(l), for the
year ended December 31, 1992)*
(j) Agreement dated May 1, 1991 by and between Owens &
Minor, Inc. and W. Frank Fife (incorporated herein
by reference to the Company's Annual Report on Form
10-K, exhibit 10(m), for the year ended December
31, 1992)*
(k) Owens & Minor, Inc. 1993 Stock Option Plan*
(l) Owens & Minor, Inc. Directors' Compensation Plan*
(m) Form of Enhanced Authorized Distribution Agency
Agreement dated as of November 16, 1993 by and
between Voluntary Hospitals of America, Inc. and
Owens & Minor, Inc.***
(11) Calculation of Net Income Per Share
(13) Owens & Minor, Inc. 1993 Annual Report to
Stockholders (Note 1)
(22) Subsidiaries of Registrant
(24) Consent of KPMG Peat Marwick, independent auditors
* A management contract or compensatory plan or arrangement
required to be filed as an exhibit to this Form 10-K.
** The schedules to this Agreement have been omitted pursuant
to Item 601(b)(2) of Regulation S-K. The Company hereby
undertakes to file supplementally with the Commission upon
request a copy of the omitted schedules.
*** The Company has requested confidential treatment by the
Commission of certain portions of this Agreement, which
portions have been omitted and filed separately with the
Commission.
(b) Reports on Form 8-K
There were no reports filed on Form 8-K during the fourth quarter of 1993
Note 1. With the exception of the information incorporated in this Form 10-K
by reference thereto, the 1993 Annual Report shall not be deemed "filed" as
a part of this Form 10-K.
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 to be
signed on its behalf by the undersigned, thereunto duly authorized.
OWENS & MINOR, INC.
by/s/ G. Gilmer Minor, Jr.
G. Gilmer Minor, Jr.
Chairman of the Board
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report is signed below by the following persons on behalf of the Registrant
and in the capacities and on the date indicated:
/s/ G. Gilmer Minor, Jr. /s/ R. E. Cabell, Jr.
G. Gilmer Minor, Jr. R. E. Cabell, Jr
Chairman of the Board Director
and Director
/s/ Philip M. Minor /s/ James B. Farinholt, Jr.
Philip M. Minor James B. Farinholt, Jr.
Vice Chairman and Director Director
/s/ G. Gilmer Minor, III /s/ Vernard W. Henley
G. Gilmer Minor, III Vernard W. Henley
President and Chief Director
Executive officer
and Director
/s/ William F. Fife /s/ E. Morgan Massey
William F. Fife E. Morgan Massey
Retired Executive Vice Director
President and Director
/s/ Glenn J. Dozier /s/ James E. Rogers
Glenn J. Dozier James E. Rogers
Senior Vice President, Director
Finance, Chief Financial
Officer
/s/ F. Thomas Smiley /s/ James E. Ukrop
F. Thomas Smiley James E. Ukrop
Vice President, Principal Director
Accounting Officer
and Controller
/s/ Anne Marie Whittemore
Anne Marie Whittemore
Director
Each of the above signatures is affixed as of March 7, 1994.
INDEPENDENT AUDITORS
REPORT ON FINANCIAL STATEMENT SCHEDULES
The Board of Directors and Stockholders
Owens & Minor, Inc.:
Over date of February 4, 1994, we reported on the consolidated balance sheets of
Owens & Minor, Inc. and subsidiaries as of December 31,1993 and 1992, and the
related consolidated statements of income, stockholders' equity and cash flows
for each of the years in the three-year period ended December 31, 1993, as
contained in the 1993 annual report to stockholders. These consolidated
financial statements and our report thereon are incorporated by reference in the
annual report on Form 10-K for the year 1993. In connection with our audits of
the aforementioned consolidated financial statements, we also audited the
related financial statement schedules included on pages 17 and 18 of this annual
report on Form 10-K. These financial statement schedules are the responsibility
of the Company's management. Our responsibility is to express an opinion on
these financial statement schedules based on our audits.
In our opinion, such financial statement schedules, when considered in relation
to the basic consolidated financial statements taken as a whole, present fairly,
in all material respects, the information set forth therein.
As discussed in Note 10 to the consolidated financial statements, as of January
1, 1993, the Company changed its method of accounting for income taxes.
KPMG Peat Marwick
Richmond, Virginia
February 4, 1994
Schedule VIII
OWENS & MINOR, INC. AND SUBSIDIARIES
Valuation and Qualifying Accounts
(In thousands)
Balance at Additions
beginning charged to Balance at
of costs and end of
Description year expenses Deductions* year
- ----------- --------- -------- --------- ----------
Allowance for doubtful
accounts deducted from
accounts and notes
receivable in the
Consolidated
Balance Sheets
December 31, 1993 $4,442 $ 497 $ 261 $4,678
December 31, 1992 $4,514 $1,351 $1,423 $4,442
December 31, 1991 $3,671 $1,506 $ 663 $4,514
* Uncollectible accounts written off.
Schedule IX
OWENS & MINOR, INC. AND SUBSIDIARIES
Short-Term and Revolving Credit Borrowings
(Dollars in thousands)
Weighted
Weighted
average
average Maximum Average
interest
interest amount amount
rate
Category of Balance rate outstanding outstanding
during
Year Ended short-term at end at end during during
the year
December 31, borrowings of year of year the year the year
(Note A)
- ------------ ---------- ------- -------- ----------- -----------
- --------
1993 Bank $37,000 3.5 % $65,300 $23,300
3.8%
1992 Bank $ 0 0 % $58,600 $ 8,413
5.9%
1991 Bank $39,400 5.0 % $63,100 $36,449
6.5%
NOTE A: Calculations are based on daily average amounts outstanding and
include commitment fees on the revolving line of credit.
Form 10-K
Exhibit Index
Exhibit # Description Page #
- --------- ----------- ------
2 Agreement of Exchange dated as of December 22, 1993 by and among
Stuart Medical, Inc., the Company, OMI Holding, Inc. and certain
shareholders of Stuart Medical, Inc.
4 (c) Owens & Minor, Inc. $40 million Credit Agreement, dated as of
November 1, 1993, among the Company and Crestar Bank and
NationsBank of Virginia, N.A.
10 (k) Owens & Minor, Inc. 1993 Stock Option Plan
(l) Owens & Minor, Inc. Directors' Compensation Plan
(m) Form of Enhanced Authorized Distribution Agency Agreement dated as
of November 16, 1993 by and between Voluntary Hospitals of America,
Inc. and Owens & Minor, Inc.
11 Calculation of Net Income Per Share
13 Owens & Minor, Inc. 1993 Annual Report to Stockholders
22 Subsidiaries of Registrant
24 Consent of KPMG Peat Marwick, independent auditors