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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended MARCH 31, 1999 Commission file number: 0-20828
DANKA BUSINESS SYSTEMS PLC
(Exact name of registrant as specified in its charter)
ENGLAND 98-0052869
(State of other jurisdiction of (I.R.S. employer identification no.)
incorporation or organization)
11201 DANKA CIRCLE NORTH
ST. PETERSBURG, FLORIDA 33716
(Address of principal executive offices) (Zip Code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (727) 576-6003
Securities registered pursuant to Section 12(g) of the Act:
ORDINARY SHARES
1.25 p each
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 an amendment to this
Form 10-K. [ ]
As of March 31, 1999, the Registrant had 228,067,865 Ordinary Shares
outstanding, including 181,058,875 represented by American Depositary Shares
("ADS"). Each ADS represents four Ordinary Shares. The ADSs are evidenced by
American Depositary Receipts. The aggregate market value of voting shares held
by non-affiliates of the Registrant as of March 31, 1999 was $281,255,051 based
on the average bid and asked prices of ADSs as quoted on the NASDAQ National
Market.
DOCUMENTS INCORPORATED BY REFERENCE
The information called for by Part III is incorporated by reference to the
definitive Proxy Statement for the 1999 Annual Meeting of Shareholders to be
filed not later than 120 days after the close of the fiscal year covered by this
report on Form 10-K.
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DANKA BUSINESS SYSTEMS PLC
ANNUAL REPORT ON FORM 10-K
MARCH 31, 1999
TABLE OF CONTENTS
PAGE
PART I
Item 1. Business 3
Item 2. Properties 11
Item 3. Legal Proceedings 11
Item 4. Submission of Matters to a Vote of Security Holders 12
PART II
Item 5. Market Price for the Registrant's Common Equity and Related Shareholder
Matters 12
Item 6. Selected Financial Data 13
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations 13
Item 8. Financial Statements and Supplementary Data 13
Item 9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure 13
PART III
Item 10. Directors and Executive Officers of the Registrant 13
Item 11. Executive Compensation 13
Item 12. Security Ownership of Certain Beneficial Owners and Management 14
Item 13. Certain Relationships and Related Transactions 14
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K 14
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PART I
ITEM 1. BUSINESS
INTRODUCTION
Danka Business Systems PLC together with its Subsidiaries ("Danka" or
the "Company") is one of the world's largest independent suppliers of
photocopiers, facsimiles and other related office imaging equipment. The Company
primarily markets these products and related services, parts and supplies on a
direct basis to retail customers. The Company principally distributes Canon,
Kodak, Ricoh and Toshiba products. It also distributes Konica and Minolta
products in certain markets. In addition, the Company markets private label
photocopiers and facsimiles and related supplies on a direct basis under the
Company's Infotec trademark. The Company also markets photocopiers and related
parts and supplies on a wholesale basis to independent dealers through its
international operations. The Company closed its U.S. wholesale operations
effective March 31, 1999. The closure was related to the Company's restructuring
of its operations and focus on core, higher margin businesses.
The Company's operations are segmented into three divisions including
Danka Americas, Danka International and Danka Services International ("DSI").
Danka Americas, which represented 58% of the Company's total revenue in fiscal
1999, distributes photocopiers, facsimiles and other related office imaging
equipment together with the related parts, supplies and services on a direct
basis to retail customers. The geographical areas covered by Danka Americas
include the United States, Canada and Latin America. The Company's Omnifax
division, which distributes private-label facsimiles and related parts, supplies
and services throughout the United States, is also included in the Danka
Americas segment. See - "Restructuring of Operations" for discussion of the sale
of Omnifax. Danka International, which represented 32% of the Company's total
revenue in fiscal 1999, also distributes photocopiers, facsimiles and other
related office imaging equipment. These products, together with the related
services, parts and supplies, are marketed primarily on a direct basis to retail
customers. Danka International also provides photocopiers, facsimiles and
related office imaging equipment on a wholesale basis to independent dealers.
Danka International has an extensive sales and service network throughout Europe
and additional operations in Australasia. DSI is the Company's worldwide
document outsourcing business and represented 10% of the Company's total revenue
in fiscal 1999. DSI provides a wide range of document management solutions,
including the management of central reprographics departments, the placement and
maintenance of convenience copiers, print-on-demand operations and document
archiving and retrieval services and document management consulting. See Note 7
"Segment Reporting" to the consolidated financial statements in the Company's
Annual Report to Shareholders for the Year Ended March 31, 1999 incorporated
herein by reference for additional financial information by segment and
geographic area (Exhibit 13 to this Report).
The Company provides a wide range of customer-related support services,
maintenance and supply contracts, training and technical support, and leasing
arrangements. The Company's focus on customer service and the contractual nature
of its service business, combined with its service contract renewals, provide a
significant source of recurring revenue. Also, as mentioned above, the Company
provides a wide range of outsourcing services through DSI. See - "Services."
The Company has completed over 140 acquisitions throughout its history.
The acquisition of Eastman Kodak Company's ("Kodak") Office Imaging and
outsourcing businesses in December 1996 was the Company's largest to date,
nearly doubling the size of the Company. Technological developments increasing
the complexity of new products, combined with the higher costs of product
support, has driven the consolidation of the industry within the North American
and European markets. This trend has caused smaller independent distributors to
consider selling their dealerships to larger marketing and service organizations
such as the Company. Through such acquisitions, the Company entered the United
Kingdom in 1993, the Canadian market in 1994, Continental Europe in 1995 and
Australasia in 1996. The Company has operations in 30 countries.
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Danka Business Systems PLC is a corporation organized under the laws of
England and Wales. The Company's principal operating subsidiaries are located in
North America, Europe, Australasia and Latin America. The registered office of
the Company is located at Masters House, 107 Hammersmith Road, London W14 0QH
England, and its telephone number is 011-44-171-603-1515. The Company's
operational and executive headquarters are located at 11201 Danka Circle North,
St. Petersburg, Florida 33716, and its telephone number is 727-576-6003.
RESTRUCTURING OF OPERATIONS
The Company implemented a number of initiatives during the second half
of fiscal 1999 related to its restructuring program including (i) a worldwide
cost reduction program designed with the goal of materially reducing selling,
general and administrative expenses, (ii) more effectively managing working
capital, including materially reducing inventory, (iii) entering into an
agreement to divest the Company's Omnifax business, (iv) a restructuring of the
Company's long-term relationship with Kodak, (v) negotiating to maintain sources
of financing for the Company's leasing business, and (vi) other elements of
restructuring of Danka's business.
The Company began initiatives related to its restructuring program
during the third quarter of fiscal 1999 including the elimination of various
marketing programs and non-essential information technology projects. The
Company also announced in late January 1999 the reduction of 450 positions at
its Rochester, NY facilities. Restructuring charges incurred in the third
quarter of fiscal 1999 were comprised of $17.6 million for severance and other
employee termination benefits, $19.4 million for facility closures and $3.1
million for the write-down of certain assets to net realizable value. The
Company incurred an additional $2.6 million in restructuring charges in the
fourth quarter of fiscal 1999 primarily for severance and other employee
termination benefits. The costs related to severance represent the elimination
of approximately 1,400 positions worldwide, over 900 of which were eliminated
as of March 31, 1999, including the reductions in Rochester. The remaining
eliminations were completed by the end of the first quarter of fiscal 2000.
Through the full implementation of the Company's worldwide cost reduction
program, the Company expects to generate over $100 million in annualized cost
savings. See - "Management's Discussion and Analysis of Financial Condition and
Results of Operations" and "Notes to the Consolidated Financial Statements" in
the Company's Annual Report to Shareholders for the Year Ended March 31, 1999
incorporated herein by reference (Exhibit 13 to this Report).
The Company also appointed Wasserstein Perella & Co. ("Wasserstein") as
financial advisor to the Company in October 1998 to evaluate its strategic and
financial options and advise the Company concerning a restructuring of its
operations. During the third quarter of fiscal 1999, Wasserstein was authorized
to market certain of the Company's divisions and operating units to pay down
debt and raise funds for the operation of the remaining businesses.
On May 20, 1999, the Company announced that it signed an agreement to
sell a 90% interest in DSI to a newly formed company controlled by Schroder
Ventures, an international private equity group. On June30, 1999, the agreement
to sell DSI to Schroder Ventures was terminated. The Company was informed by
IBM, a customer of DSI, that there was a distinct possibility IBM might choose
to exercise its right to terminate its agreement as a customer with DSI, and
that this action could occur at any time. As a result of this notice, and after
discussions with IBM, Schroder Ventures informed the Company that Schroder
Ventures and its lenders declined to close the transaction.
The Company also announced on June 18, 1999 that it signed a definitive
agreement to sell its facsimile business, Omnifax, to Xerox Corporation for a
cash consideration of $45.0 million. The Company expects to complete the sale of
Omnifax during the second quarter of fiscal 2000.
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PRODUCTS
The Company's primary products are photocopiers, facsimile equipment,
other office imaging equipment, and related parts and supplies. The photocopier
industry is informally divided into six segments. Segments one and two contain
the least sophisticated photocopiers and can produce up to 30 copies per minute;
segments three and four contain faster and more sophisticated mid-range
photocopiers producing 31 to 69 copies per minute; and segments five and six
contain the most sophisticated and fastest photocopiers in the industry which
run 70 to 90+ copies per minute. The principal manufacturers in segments one
through four are Canon, Konica, Minolta, Ricoh, Sharp and Toshiba. The
acquisition of Kodak's Office Imaging sales and service operations in December
1996 provided Danka with access to the high-end copier market, which
includes segments five and six. Kodak and Xerox have historically dominated
segments five and six. Effective May 10, 1999, Kodak sold its equipment, toner
and developer manufacturing operations to a subsidiary of Heidelberger
Druckmaschnen AG ("Heidelberg"), a global market leader in printing systems.
Advances in technology and changing market demands have also led to the
emergence of color, digital and multifunctional equipment, all of which the
Company currently distributes. The Company will continue to expand its product
offerings to encompass new equipment as it is made available by its vendors and
through strategic alliances. See - "Vendors."
The Company also distributes a range of facsimile equipment,
concentrating in the more sophisticated plain paper and multifunctional models.
The plain paper and multifunctional models use toner and other supplies and
require maintenance similar to photocopiers. A majority of the facsimile
machines the Company has historically sold are private label products under the
Company's dex and Omnifax trademarks. On June 18, 1999, the Company announced
a definitive agreement to sell its facsimile division, Omnifax, to Xerox
Corporation. See - "Restructuring of Operations."
The Company believes that the black and white photocopier and facsimile
equipment markets will continue to change with the increasing acceptance of
digital technology. Digital products have the ability to communicate with other
office imaging equipment. This innovation is resulting in a blurring of the
distinction between traditional photocopiers, facsimile equipment and printers,
with the emergence of a range of multifunctional office imaging equipment that
prints, copies, scans and faxes all from one machine.
Many of the Company's existing vendors have expended considerable
resources in the research, development, and creation of digital products and
have introduced several digital black and white and color photocopiers and
printers. The Company has developed and acquired certain of the expertise
necessary to support the transition to digital technology and provides training
and support to its sales professionals and service technicians for new vendor
digital product offerings. The use of digital equipment is playing an important
role in the industry as companies transition from an analog to a digital office
environment. The Company has seen a considerable acceleration in the shift from
analog to digital products and took several steps during fiscal 1999 to
strengthen its digital product portfolio. In January 1999, the Company received
authorization from Canon to offer a full line of digital black and white copiers
throughout the U.S. Furthermore, the Company introduced its first digital
high-volume machine, the DigiSource 9110, in March 1999 and launched worldwide
distribution of the product in July. The Company is currently negotiating a
long-term supply agreement with Heidelberg for the DigiSource 9110. The
DigiSource 9110 was developed by Kodak and is designed and assembled through a
joint venture by Heidelberg Digital and Nexpress Solutions.
Color photocopiers also represent a growing segment of the office
imaging market. The Company continues to expand its color markets through its
principal relationship with Canon and Ricoh. With a color server, color
photocopiers can be converted into networkable color printers that will accept
digital output from a computer as well as hard copy inputs which can be
reproduced or scanned into the computer, thus increasing the functionality of
the unit. In September 1998, the Company announced a new strategic alliance with
Canon, strengthening its color product portfolio. The alliance allows the
Company to offer the complete line of Canon color copiers to all of its
customers throughout North America, Europe and select Latin American countries.
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As a percentage of copier equipment sales, digital and color products
sold by the Company in the U.S. represented approximately 23% of equipment sales
in fiscal 1999, increasing from 15% in fiscal 1998. On a worldwide basis,
digital and color products sold by the Company in fiscal 1999, represented
approximately 26% of equipment sales in the U.S. and international markets on a
combined basis.
SERVICES
In fiscal 1999, retail service, supplies and rentals represend 66%
of the Company's total revenue. This revenue is primarily derived fromits
equipment, maintenance and supply contracts ("EMS Contracts") and other
maintenance contracts. Generally, EMS Contracts are for a one-year term and are
automatically renewable. Although the Company has various payment arrangements,
most maintenance contracts are based upon a per copy charge. These arrangements
provide the customer with scheduled payments that can be conveniently budgeted
and provide the Company with a steady source of revenue. As a percentage of
total revenue, retail service, supplies and rentals increased significantly
following the acquisition of Kodak's Office Imaging and outsourcing businesses,
in which a significantly higher portion of revenue is generated from retail
service, supplies and rentals. This is due to the higher levels of recurring
revenue associated with high-end copiers and printers and the contractual nature
of the Company's outsourcing business as discussed below.
DSI, the Company's document management outsourcing operations, is also
included in the Company's retail service, supplies and rentals revenue stream.
DSI provides services including the management of central reprographics
departments, placement of convenience copiers, fleet management of customer
equipment, print-on-demand operations, and document archiving and retrieval
services. DSI also provides strategic consulting services, advising customers on
how to manage their document systems and how to add efficiencies--including the
shift from a stand alone analog copier to a networked digital copier/printer
system, the storage of data, and the flow of information throughout the
business. Generally, the Company's outsourcing contracts are based on a
five-year term.
MARKETING, CUSTOMERS AND SALES ORGANIZATION
The Company believes that, in addition to price and product performance
and capabilities, its retail customers primarily base their purchasing decisions
on the quality of post-sales service and support, speed of service, and the
availability of financing and rental programs. The Company believes that its
wholesale customers primarily base their purchasing decisions on price, speed of
delivery, dealer support, product performance and capabilities, and availability
of financing. The Company's wholesale business extends across Europe. Effective
March 31, 1999, the Company closed its U.S. wholesale operations in connection
with its restructuring initiatives.
The Company's retail operations target a broad range of customer
groups, including small businesses to large multinational companies,
professional firms, and governmental and educational institutions. Additionally,
the Company markets Infotec private label copiers and facsimiles on a wholesale
basis to a network of authorized independent dealers.
Sales personnel turnover is common in the industry and the Company
makes a considerable effort to retain qualified sales personnel. The Company's
U.S. sales force declined below its target levels during fiscal 1999 primarily
due to the negative press surrounding the Company's financial situation. The
Company implemented several initiatives during the second half of fiscal 1999
related to the restructuring of its operations. See "Restructuring of
Operations" for discussion. As a result of the Company's progress on its
restructuring initiatives, the Company's bank lenders approved an amendment to
its Credit Agreement in July 1999, which extended its waiver through July 31,
2000. See - "Management's Discussion and Analysis of Financial Condition and
Results of Operations" in the Company's Annual Report to Shareholders for the
Year Ended March 31, 1999 incorporated herein by reference (Exhibit 13 to this
Report). It is the Company's goal to stabilize and strengthen Danka's sales
force, specifically in the U.S., expanding its coverage evenly among
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1,300 territories. At March 31, 1999, the Company's international sales force
was at levels consistent with the prior year.
The Company's compensation plan is designed to provide a career path
for the Company's sales representatives and the opportunity to move up from
selling lower segment machines and service to more complex systems. By
increasing training and providing a career path, it is the Company's goal to
reduce current attrition levels. The compensation is comprised of a base salary
and a selling commission, which is based on several variables. These variables
include revenue as a percent of quota, service pricing levels, gross profit and
the net installed equipment base or population.
The Company currently utilizes a range of advertising and promotional
activities, including radio, billboard and print media advertising campaigns,
distribution of descriptive brochures and direct mail pieces, and informational
seminars and presentations. The Company's marketing efforts are enhanced by
manufacturers' national advertising campaigns and co-op arrangements where
appropriate and applicable. The Company also utilizes its website at
www.danka.com as a marketing tool.
VENDORS
The Company's business is dependent upon close relationships with its
vendors and its ability to purchase products from these vendors on competitive
terms. During fiscal 1999, the Company's sales of Canon, Konica, Minolta, Ricoh,
Sharp and Toshiba photocopiers, facsimile equipment and related accessories
represented approximately 60% of its total equipment revenue, excluding the U.S.
wholesale division which the Company closed effective March 31, 1999. The sale
of Kodak branded equipment and accessories represented approximately 24% of
total equipment revenue, excluding the Company's U.S. wholesale division. The
Company also relies on its equipment vendors for parts and supplies.
The Company conducts its business in reliance upon its continuing
ability to purchase equipment, supplies, and parts from its current
manufacturers pursuant to authorized retail dealer and wholesale agreements
("Authorized Manufacturer Agreements"). The Company's retail operations' primary
Authorized Manufacturer Agreements are with Canon, Konica, Minolta, Ricoh and
Toshiba. Such agreements are generally for one-year terms, cover only specific
products, have specific territorial boundaries, and may be terminated with
cause, and in some instances, without cause. During fiscal 1999, the Company
entered into certain alliances that expanded its product availability beyond
specific authorized territories. As mentioned above, in September 1998, Danka
announced a new strategic alliance with Canon allowing the Company to offer the
complete line of Canon color copiers to all of its customers throughout North
America, Europe and select Latin American countries. In January, the Company
received authorization from Canon to offer a full line of digital black and
white copiers throughout the U.S. The Company has similar distribution rights
regarding Toshiba digital black and white products. The Company's international
wholesale operations have agreements with Ricoh and Toshiba, and contain terms,
which are substantially similar to those of the Company's retail operations. In
connection with the acquisition of Kodak's Office Imaging and outsourcing
businesses in December 1996, the Company also entered into various supply
agreements with Kodak. These agreements were terminated effective December 15,
1998. The terms of these agreements varied from the Company's traditional
Authorized Manufacturing Agreements. See - "Kodak Agreements" below. As
mentioned above, effective May 10, 1999, Kodak sold its equipment, toner and
developer manufacturing operations to a subsidiary of Heidelberg, a global
market leader in printing systems. The Company and Heidelberg are engaged in
negotiations with respect to a long-term supply agreement for the Kodak
equipment, parts and supplies the Company already sold at the time of
Heidleberg's acquisition, as well as an additional agreement with respect
to the new digital high-volume machine, the DigiSource 9110.
LEASING
The Company has historically financed a substantial portion of its leasing
business using various funding sources. The Company believes that the ability of
its sales force to offer customers the option to lease equipment
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leads to additional sales. One of the largest programs to obtain such funding is
one under which General Electric Capital Corporation ("GE Capital") provides
funding used by a Master Trust to acquire customer leases from a subsidiary of
the Company. On November 12, 1998, GE Capital served a notice making certain
assertions and demanding various actions and assurances in connection with this
program, including confirmation from the Company's bank lenders that assets
transferred to the Master Trust were and would be free and clear of the lenders'
liens. The Company has been able to satisfy various requirements imposed by GE
Capital, including confirmation by the bank lenders as to the lien status of
assets transferred to the Master Trust.
As a result of the Company's ability to meet these various requirements of
GE Capital, the Company has continued to finance the majority of its leasing
business through GE Capital, including utilizing the Master Trust Agreement
noted above. The Company is presently negotiating with GE Capital a lease
financing arrangement outside of the Master Trust, which would substantially
replicate the economic benefits to the Company of leases funded under the Master
Trust. Additionally, the Company continues to obtain financing from other
funding sources of leases not financed by GE Capital.
Leasing arrangements also permit the Company to utilize its capital for
other business activities. The Company has similar arrangements for leases,
which are offered to customers outside the U.S.
TRAINING
A key element of the Company's operating philosophy is the training of
its employees in order to assist in the uniform application of the Company's
established operating procedures throughout the sales network. As described
above, the Company has introduced a new compensation plan designed to provide a
career path for its sales representatives. Upon employment, Company sales
representatives participate in an intensive information and skills training
program with areas of focus including company overview, competitive marketplace,
selling skills, customer satisfaction, product knowledge as well as finance and
business skills. After the initial training has been successfully completed, the
Company continues to develop the skills and knowledge of its sales
representatives with new product training, self-study computer based courses and
on-going sales skills development.
Service technicians new to the Company are immediately trained and
certified in accordance with the Company's methods, procedures, and standards.
The Company's technical personnel are continuously updated and retrained as new
technology is developed. The Company's service training centers are certified as
manufacturers' authorized service facilities. The Company monitors service
technicians' continued educational experience and fulfillment of requirements in
order to evaluate the competence of its service technicians. All the Company's
service technicians receive service bulletins, service technician tips and
continued training seminars throughout their careers with the Company.
KODAK AGREEMENTS
In connection with the acquisition of Kodak's Office Imaging and
outsourcing businesses in December 1996, the Company entered into certain supply
agreements, which required the Company to make minimum equipment purchases from
Kodak. To the extent the Company exceeded or failed to purchase these amounts,
the Company was to either receive a refund or make additional payments to Kodak.
For the year ended March 31, 1998, the Company recorded a provision of $10.0
million for the anticipated shortfall in equipment purchases relating to various
supply agreements. The Company also agreed to contribute a total of $175.0
million (plus an additional $30.0 million if certain research milestones are
met) to Kodak's ongoing research and development activities. Effective December
15, 1998, these agreements were terminated. During the fourth quarter of fiscal
1999, the Company and Kodak reached a new research and development agreement
relating to the completed development of a digital high-volume copier, the
DigiSource 9110, under which the Company agreed to pay approximately $23.0
million. The new machine was introduced in March 1999 at CeBit, an international
trade fair in Hanover, Germany. On June 24, 1999, Kodak and the Company reached
an agreement
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providing for mutual release of claims and obligations related to certain
agreements previously entered into by Kodak and the Company. In connection with
this agreement, liabilities of $10.0 million for the anticipated shortfall in
Kodak equipment purchases recorded during the third quarter of fiscal 1998 and
$13.5 million relating to research and development and other accrued costs
recorded during the third quarter of fiscal 1999 were reversed during the fourth
quarter of fiscal 1999. See - "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and "Notes to the Consolidated Financial
Statements" in the Company's Annual Report to Shareholders for the Year Ended
March 31, 1999 incorporated herein by reference (Exhibit 13 to this Report).
COMPETITION
The Company's business is highly competitive with a number of competitors
in most geographic markets. The Company's retail operations are in direct
competition with local and regional equipment suppliers and dealers,
manufacturers, mass merchandisers, and wholesale clubs. Depending upon the
customer, principal areas of competition may include: quality and speed of
post-sales service support; availability of competitive products, parts and
supplies; speed of delivery; product capability and performance; financing
terms; and the availability of financing, leasing, or rental programs. Principal
areas of competition for wholesale operations are availability of competitive
products, price, speed of delivery, dealer support, centralized volume buying,
product performance, and the availability of financing programs. The Company
closed its U.S. wholesale operations effective March 31, 1999. The closure
related to the Company's restructuring of its operations and focus on core,
higher margin businesses. The Company's remaining wholesale operations extend
across Europe. The continued ability of the Company to offer competitive office
imaging equipment in all segment areas is important in both retail and wholesale
operations. See - "Products." As a result of acquiring Kodak's Office Imaging
business in December 1996, the Company significantly increased its presence in
the high-volume photocopier market currently dominated by Xerox Corporation.
EMPLOYEES
As of March 31, 1999, the Company employed approximately 18,000
persons, of which approximately 7,600 were service engineers and approximately
2,600 were devoted to generating sales. The remaining employees were devoted to
training, management, and other administrative and support positions in the
field and corporate locations. Support positions in the field include warehouse
and delivery functions, dispatch, meter readings, renewal of customer
maintenance agreements, accounts receivable collection and billing functions.
Some of the Company's non-U.S. employees are subject to labor
agreements that establish rates of pay, working hours, procedures for orderly
settlement of disputes and other terms and conditions of employment. The Company
considers its employee relations to be good, and believes that it provides
working conditions and wages, which are comparable with those of its
competitors.
The Company relies heavily on its senior management, and the loss of
certain Executive Officers could have an adverse effect on the Company.
Additionally, the Company's ability to successfully grow and maintain its
management and employee base is extremely important to the Company's continued
success.
TRADEMARKS AND SERVICE MARKS
The Company believes that its trademarks and service marks have gained
significant recognition in the office imaging and document management industry
and are important to its marketing efforts. The Company has registered various
trademarks and service marks in certain markets. The trademarks "Danka", "dex",
"Omnifax" and "Infotec" are among those registered marks, which are viewed as
important to the Company's ongoing business. The Company's policy is to continue
to pursue registration of its marks whenever possible and to oppose vigorously
any infringement of its proprietary rights. Depending on the jurisdiction,
trademarks
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and service marks are valid as long as they are in use and/or their
registrations are properly maintained, and they have not been found to become
generic. Registrations of trademarks and service marks in the United States can
generally be renewed indefinitely as long as the trademarks and service marks
are in use.
BACKLOG
The backlog of orders at March 31, 1999 and March 31, 1998 were not
material.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in this Form 10-K, or otherwise made by
officers of the Company, including statements related to the Company's ability
to meet challenges it faces, the Company's future performance and the Company's
outlook for its businesses and respective markets, projections, statements of
management's plans or objectives, forecasts of market trends and other matters,
are forward-looking statements, and contain information relating to the Company
that is based on the beliefs of management as well as assumptions, made by, and
information currently available to, management. The words "goal", "anticipate",
"expect", "believe" and similar expressions as they relate to the Company or the
Company's management, are intended to identify forward-looking statements. Such
statements reflect the current views of the Company with respect to future
events and are subject to certain risks, uncertainties and assumptions that
could cause actual results to differ materially from those reflected in the
forward-looking statements. No assurance can be given that the results in any
forward-looking statement will be achieved. For the forward-looking statements,
the Company claims the protection of the safe harbor for forward-looking
statements provided for in the Private Securities Litigation Act of 1995.
Factors that might cause such differences include, but are not limited to (i)
failure to obtain one or more waivers or longer term financing beyond the July
31, 2000 waiver period to meet the Company's liquidity needs, whether through
failure to perform as described in business plans provided to the Company's
lenders or otherwise, (ii) increased competition resulting from other
high-volume and digital copier distributors and the discounting of such copiers
by competitors, (iii) any inability by the Company to manage and reduce its
outstanding debt, meet its working capital needs or otherwise adequately address
its liquidity challenges, (iv) any inability by the Company to procure or any
inability by the Company to continue to gain access to and successfully
distribute new, products, including digital products and high-volume copiers, or
to continue to bring current products to the marketplace at competitive costs
and prices, (v) any inability by the Company to finalize a long-term supply
agreement with Heidelberg, (vi) any inability by the Company to achieve
projected cost savings, (vii) the refusal by any vendor to provide equipment,
parts and supplies as a result of the Company's financial condition, (viii) any
inability by the Company to successfully close facilities without negative
impact on the Company's operations, (ix) any inability by the Company to obtain
adequate funding for its leasing business, (x) any inability by the Company to
bring SG&A expenditures of the Company's U.S. division into line with
anticipated sales, (xi) business disruption resulting from year 2000 issues
including unidentified noncompliance of technology, delays or difficulties in
implementing new IT infrastructure, delays or difficulties in converting
remaining systems and applications, and untimely third party completion of year
2000 compliance, (xii) any inability by the Company to complete the sale of its
Omnifax business, (xiii) the ultimate outcome and impact of the pending class
action lawsuit or any other lawsuit, (xiv) any negative impact from the loss of
any key upper management personnel, (xv) any negative impact on the Company's
financial condition or results of operations caused by the Euro conversion,
(xvi) any significant assessment, pursuant to the review by the Internal Revenue
Service (xvii) fluctuations in foreign currencies and (xviii) other risks
including those risks identified in any of the Company's other filings with the
Securities and Exchange Commission. Readers are cautioned not to place undue
reliance on these forward-looking statements, which reflect management's
analysis only as of the date they are made. The Company undertakes no obligation
and does not intend to update these forward-looking statements to reflect events
or circumstances that arise after the date such statements are made.
Furthermore, as a matter of policy, the Company does not generally make
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any specific projections as to future earnings nor does it endorse any
projections regarding future performance, which may be made by others outside
the Company.
ITEM 2. PROPERTIES
The Company's general policy is to lease, rather than own, its business
locations. The Company leases numerous properties for administration, sales and
service, and distribution functions. The terms vary under the respective leases
and some contain a right of first refusal or an option to purchase the
underlying real property and improvements. In general, the Company's lease
agreements require it to pay its proportionate share of taxes, common area
expenses, insurance, and related costs of such rental properties. In addition,
the Company leases approximately 500 properties for its retail and wholesale
operations.
The Company owns several smaller business locations, none of which are
necessary to the success of the particular location's business. Generally, these
properties were included among the assets obtained in certain acquisitions. In
the future, the Company may dispose of such properties and enter into leases of
properties, which the Company believes may be more desirable or more centrally
located.
Management believes that the properties it occupies are, in general,
suitable and adequate for the purposes for which they are utilized.
ITEM 3. LEGAL PROCEEDINGS
The Company, former directors and former officers are defendants in a
purported class action lawsuit. A consolidated class action complaint (the
"Complaint") was filed in the United States District Court for the Middle
District of Florida, Tampa Division on or about June 18, 1998. The Complaint
alleges, principally, that the Company and the other defendants issued
materially false and misleading statements related to the progress of the
Company's integration of its acquisition of Kodak's Office Imaging and
outsourcing businesses, engaged in improper accounting practices and that
certain former officers utilized insider information, in violation of Sections
10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5
promulgated thereunder. The plaintiffs seek to certify their complaints as class
actions on behalf of all purchasers of the Company's American Depositary
Receipts in the period between May 13, 1997 and December 15, 1997, and seek an
award of an unspecified amount of monetary damages, including punitive damages,
to all of the members of the purported class. The Company filed its motion to
dismiss the Complaint on or about July 29, 1998 and all briefs have been
submitted to the Court. The Company has not received a ruling from the court on
its motion. The case is in the early stages and while it is impossible to
predict the outcome or impact of such litigation, management believes this
litigation is without merit and is vigorously defending the lawsuit.
As previously disclosed, the Company was a defendant in a purported
lawsuit brought by the Company's former Chief Executive and Director asserting
claims of breach of contract and fraud for the Company's refusal to pay certain
sums alleged due under his employment agreement. The settlement of this case,
which occurred during the first quarter of fiscal 2000, did not have a material
impact on the Company's operations.
In February 1999, the Company was served with a complaint alleging breach
of contract, breach of duty of good faith and fair dealing, conversion and
violation of the Uniform Commercial Code. More particularly, the plaintiffs
allege that in December 1997, they attempted to sell approximately one million
restricted American Depositary Shares at approximately $35.00 per share and that
the Company and its attorneys wrongfully refused and/or unreasonably delayed in
registering the transfer of the plaintiffs' restricted shares. The complaint
further states that the plaintiffs were unable to complete the sale of shares
and were later forced to sell the shares in
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February 1998 at approximately $17.00 per share. The plaintiffs are attempting
to recover the difference from the Company and its attorneys. The Company
recently filed its motion to dismiss the complaint. This case is in the early
stages and while the outcome of such litigation is impossible to predict,
management believes this litigation is without merit and intends to vigorously
defend the lawsuit.
The Company is subject to other legal proceedings and claims, which
arise in the ordinary course of its business. Management believes that the
resolution of the above matters will not have a material adverse effect upon the
Company's financial position, results of operations or liquidity.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
PART II
ITEM 5. MARKET PRICE FOR REGISTRANT'S COMMON EQUITY AND
RELATED SHAREHOLDER MATTERS
The following table sets forth the high and low sale price per American
Depositary Share ("ADS") as reported by the Nasdaq National Market and the high
and low middle market quotations (which represent an average of bid and offered
prices in pence) for the Ordinary Shares as reported on the London Stock
Exchange Official List. Each ADS represents four Ordinary Shares.
U.S. Dollars per Pence per
ADS Ordinary Share
High Low High Low
- ---------------------------------------------------------------------------------------------------
Fiscal Year 1999:
Quarter ended June 30, 1998 $23.75 $11.50 344p 189p
Quarter ended September 30, 1998 12.88 5.75 194 85
Quarter ended December 31, 1998 6.88 1.75 92 29
Quarter ended March 31, 1999 6.00 4.13 88 63
Fiscal Year 1998:
Quarter ended June 30, 1997 $43.63 $26.50 648p 425p
Quarter ended September 30, 1997 51.31 37.00 788 558
Quarter ended December 31, 1997 47.00 12.38 713 215
Quarter ended March 31, 1998 21.13 15.25 322 239
As of March 31, 1999, 45,264,719 ADSs were held of record by 4,700 registered
holders and 47,008,990 Ordinary Shares were held of record by 4,361 registered
holders. Since some of the ADSs and Ordinary Shares are held by nominees, the
number of holders may not be representative of the number of beneficial owners.
The Company most recently paid a dividend to shareholders on July 28, 1998. The
Company is not currently permitted to pay dividends under the Credit Agreement.
Any determination to pay cash dividends after the refinancing of the
indebtedness outstanding thereunder will be made by the Board of Directors in
light of the Company's earnings, financial position, capital requirements,
credit agreements and other such factors as the Board of Directors deems
relevant.
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ITEM 6. SELECTED FINANCIAL DATA
The information required by this Item is incorporated herein by
reference to the information under the heading "Selected Consolidated Financial
Data" in the Company's Annual Report to Shareholders for the Year Ended March
31, 1999. See Exhibit 13 to this Report.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The information required by this Item is incorporated herein by
reference to the information under the heading "Management's Discussion and
Analysis of Financial Condition and Results of Operations" in the Company's
Annual Report to Shareholders for the Year Ended March 31, 1999. See Exhibit 13
to this Report.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information required by this Item is incorporated herein by
reference to the information under the headings "Consolidated Statements of
Operations", "Consolidated Balance Sheets", "Consolidated Statements of Cash
Flows", "Consolidated Statements of Shareholders' Equity" and "Notes to the
Consolidated Financial Statements" in the Company's Annual Report to
Shareholders for the Year Ended March 31, 1999. See Exhibit 13 to this Report.
As is the case with any company, prior financial condition and results of
operations are not necessarily indicative of future results.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
Not applicable.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information required by this Item is incorporated herein by
reference to the information under the headings "MANAGEMENT - Directors and
Executive Officers" in the Company's definitive Proxy Statement to be used in
connection with the Company's 1999 Annual Meeting of Shareholders, to be filed
not later than 120 days after the close of the fiscal year covered by this
report on Form 10-K.
ITEM 11. EXECUTIVE COMPENSATION
The information required by this Item is incorporated herein by
reference to the information under the headings "MANAGEMENT - Compensation of
Executive Officers and Directors" in the Company's definitive Proxy Statement to
be used in connection with the Company's 1999 Annual Meeting of Shareholders, to
be filed not later than 120 days after the close of the fiscal year covered by
this report on Form 10-K.
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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The information required by this Item is incorporated herein by
reference to the information under the heading "MANAGEMENT - Security Ownership
of Management and Others" in the Company's definitive Proxy Statement to be used
in connection with the Company's 1999 Annual Meeting of Shareholders, to be
filed not later than 120 days after the close of the fiscal year covered by this
report on Form 10-K.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required by this Item is incorporated herein by
reference to the information under the heading "CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS" in the Company's definitive Proxy Statement to be used in
connection with the Company's 1999 Annual Meeting of Shareholders, to be filed
not later than 120 days after the close of the fiscal year covered by this
report on Form 10-K.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
FORM 8-K
(a) 1. The following Financial Statements of the Registrant included in
Part II, Item 8, of this Report are incorporated herein by reference
as described in Item 8:
Consolidated Statements of Operations - Years ended March 31, 1999,
1998 and 1997
Consolidated Balance Sheets - March 31, 1999 and 1998
Consolidated Statements of Cash Flows - Years ended
March 31, 1999, 1998 and 1997
Consolidated Statements of Shareholders' Equity - Years ended
March 31, 1999, 1998 and 1997
Notes to the Consolidated Financial Statements - Years ended
March 31, 1999, 1998 and 1997
Independent Auditor's Report
2. The following Financial Statement Schedules of the Registrant are
included in Item 14(d):
Independent Auditor's Report
II - Valuation and Qualifying Accounts
All other schedules are omitted because the required information is
not present in amounts sufficient to require submission of the
schedule, the information required is included in the financial
statements and notes thereto or the schedule is not required or
inapplicable under the related instructions.
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3. Exhibit index:
Exhibit
Number Description of Document
- ------- -----------------------
2.1* Asset Purchase Agreement between Eastman Kodak Company and Danka
Business Systems PLC dated as of September 6, 1996, including
Exhibit 5.19 (a) which is the form of Amended and Restated Supply
Agreement by and between Eastman Kodak Company and
_______________________ dated as of ____________________, 1996.
(Exhibit 2.1 to the Company's Form 8-K dated November 14, 1996.)
2.2* Amendment No. 1 to Asset Purchase Agreement between Eastman Kodak
Company and Danka Business Systems PLC dated December 20, 1996
(Excluding schedules and similar attachments). (Exhibit 2.2 to the
Company's Form 8-K dated January 15, 1997).
3.1* Memorandum of Association of the Company. (Exhibit 3.1 of Company's
Registration Statement on Form 20-F, No. 0-20828, filed on November
10, 1992 [the "1992 Registration Statement"].)
3.2* Articles of Association of the Company. (Exhibit 3.2 to the 1992
Registration Statement.)
4.1* Memorandum of Association of the Company, including paragraphs 5 and
6. (Exhibit 2.1 to the 1992 Registration Statement.)
4.2* Articles of Association of the Company, including sections relating
to Shares, Variation of Rights and Votes of Members. (Exhibit 2.2 to
the 1992 Registration Statement.)
4.3* Form of Ordinary Share certificate. (Exhibit 4.3 of Company's
Registration Statement on Form S-1, No. 33-68278, filed on October
8, 1993 [the "1993 Registration Statement"]).
4.4* Form of American Depositary Receipt. (Exhibit 4.4 to the 1993
Registration Statement.)
4.5* Deposit Agreement dated June 25, 1992, Amendment No. 1 dated
February 26, 1993 and Amendment No. 2 dated July 2, 1993 (Exhibit
4.9 to the 1993 Registration Statement.) and Amendment No. 3 dated
August 16, 1994 between The Bank of New York, Company and Owners and
Holders of American Depositary Receipts.
4.6* Indenture dated March 13, 1995 between the Company and The Bank of
New York, as Trustee. (Exhibit 2 to the Company's Form 8-K dated
March 21, 1995).
4.7* Deposit and Custody Agreement dated March 13, 1995, between The Bank
of New York as Depositary and the Company. (Exhibit 3 to the
Company's Form 8-K dated March 21, 1995).
4.8* Registration Rights Agreement dated as of March 13, 1995 relating to
$175,000,000 in Aggregate Principal Amount of 6.75% Convertible
Subordinated Notes Due 2002 by and among the Company and Prudential
Securities Incorporated and Smith Barney, Inc. and Robert W. Baird &
Co. and Raymond James & Associates, Inc. (Exhibit 4.12 to the
Company's 1995 Form 10-K).
4.9* Resolution No. 7 adopted by shareholders at the 1997 annual general
meeting waiving pre-emptive rights of shareholders under certain
circumstances filed with the Company's 1997 Proxy Statement.
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4.11* Credit Agreement dated December 5, 1996, by and among Danka Business
Systems PLC, Dankalux Sarl & Co. SCA, Danka Holding Company, the
several financial institutions from time to time a party and
NationsBank, N.A., as agent (Exhibit 4 to the Company's Form 8-K
dated December 16, 1996).
4.12* First Amendment to Credit Agreement dated December 5, 1997 among
Danka Business Systems PLC, Dankalux Sarl & Co., SCA, and Danka
Holding Company, Nationsbank, National Association, each other Bank
signatory thereto and Nationsbank, National Association, as agent.
(Exhibit 4.9 to the Company's Form 10-Q dated February 12, 1998).
4.13* Second Amendment to Credit Agreement dated July 28, 1998 among Danka
Business Systems PLC, Dankalux Sarl & Co., SCA, and Danka Holding
Company, Nationsbank, National Association, each other Bank
signatory thereto and Nationsbank, National Association, as agent.
(Exhibit 4.10 to the Company's Form 8-K July 28, 1998).
4.14* Waiver dated October 20, 1998, of certain financial covenants
contained in the Credit Agreement among Danka Business Systems PLC,
Dankalux Sarl & Co., SCA and Danka Holding Company, NationsBank,
N.A., each other Bank signatory to the Credit Agreement and
NationsBank, N.A., as agent. (Exhibit 4.11 to the Company's Form 8-K
October 21, 1998).
4.15* Waiver dated February 26, 1998, of certain financial covenants
contained in the Credit Agreement among Danka Business Systems PLC,
Dankalux Sarl & Co., SCA and Danka Holding Company, NationsBank,
N.A., each other Bank signatory to the Credit Agreement and
NationsBank, N.A., as agent. (Exhibit 4.12 to the Company's Form 8-K
March 5, 1999).
10.2* Office Building Lease dated May 1, 1992 between Daniel M. Doyle and
Francis J. McPeak, Jr., and Gulf Coast Business Machines. (Exhibit
3.5 to the 1993 Form 20-F).
10.3* Office Building Lease dated April 1, 1990 between Daniel M. Doyle
and Francis J. McPeak, Jr., and Danka. (Exhibit 3.6 to the 1993 Form
20-F).
10.4* Lease Agreement dated December 22, 1986, and Addendum Lease
Agreement dated March 1, 1987, between Daniel M. Doyle and Francis
J. McPeak and Danka. (Exhibit 3.7 to the 1993 Form 20-F).
10.5* U.K. Executive Share Option Scheme. (Exhibit 3.11 to the 1993 Form
20-F).
10.6* U.S. Executive Incentive Stock Option Plan. (Exhibit 3.12 to the
1993 Form 20-F).
10.7* Form of Stock Option Agreement. (Exhibit 3.13 to the 1993 Form
20-F).
10.8* Addendum to Lease Agreement dated September 1, 1992, between
Mid-County Investments, Inc. and Danka. (Exhibit 3.38 to the 1993
Form 20-F).
10.9* Lease Agreement dated November 12, 1992 and Lease Commencement
Agreement dated April 7, 1993 between PARD, Inc. and Danka. (Exhibit
10.41 to the 1993 Form 20-F).
10.10* Deposit Agreement dated June 25, 1992, Amendment No. 1 dated
February 26, 1993 and Amendment No. 2 dated July 2, 1993, between
The Bank of New York, Company and Owners and Holders of American
Depositary Receipts, filed as Exhibit 4.5 and incorporated as
reference.
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10.14* Danka Business Systems PLC 1994 Executive Performance Plan. (Exhibit
10.52 to the 1994 Form 10-K).
10.15* Indenture dated March 13, 1995 between the Company and The Bank of
New York, as Trustee. (Exhibit 2 to the Company's Form 8-K dated
March 21, 1995).
10.18* Purchase Agreement dated October 25, 1995 between ABN AMRO Bank N.V.
and Credit Lyonnais Bank Nederland N.V. and Danka Europe B.V.
(Exhibit 2 to the Company's Form 8-K dated November 3, 1995).
10.20* The Danka 1996 Share Option Plan filed as Appendix 1 of the 1996
Annual Proxy Statement and approved by shareholders under Resolution
10.
10.22* Amendments to the Danka 1996 Share Option Plan filed as Appendix A
of the 1998 Annual Proxy Statement and approved by shareholders
under Resolution 9.
10.21* The Danka 1996 Non-Employee Directors Share Option Plan filed as
Appendix 2 of the 1996 Annual Proxy Statement and approved by
shareholders under Resolution 11.
13 Annual Report to Shareholders of the Company for the year ended
March 31, 1999. The portions of the Company's Annual Report to
Shareholders incorporated by reference into this Report are included
herein as exhibits.
21 List of Current Subsidiaries of the Company.
23 Consent of Independent Accountants
27 Financial Data Schedule (for SEC use only).
27.1 Financial Data Schedule Restated and Amended (March 31, 1998 Form
10-K).
27.2 Financial Data Schedule Restated and Amended (March 31, 1997 Form
10-K).
* Document has heretofore been filed with the Commission and is
incorporated by reference and made a part hereof.
(b) Reports on Form 8-K
On March 5, 1999, the Company filed a report on Form 8-K
announcing a 180-day extension for the waiver on its Credit Agreement granted by
its Lenders.
(c) Exhibits:
The exhibits listed in Item 14(a)(3) to this Report are
filed with this Report.
(d) Financial Statement Schedules
Independent Auditor's Report
II - Valuation and Qualifying Accounts
All other schedules are omitted since the required
information is not present or is not present in amounts
sufficient to require submission of the schedules.
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INDEPENDENT AUDITOR'S REPORT
To the Members of Danka Business Systems PLC:
Under date of July 14, 1999, we reported on the consolidated balance sheets of
Danka Business Systems PLC and subsidiaries as of March 31, 1999 and 1998 and
the related consolidated statements of operations, shareholders' equity and cash
flows for each of the years in the three-year period ended March 31, 1999, as
contained in the 1999 annual report to shareholders. These consolidated
financial statements and our report thereon are incorporated by reference in the
annual report on Form 10-K for the year 1999. In connection with our audits of
the aforementioned financial statements, we also have audited the related
financial statement schedule as listed in the accompanying index. This financial
statement schedule is the responsibility of the Company's management. Our
responsibility is to express an opinion on the financial statement schedule
based on our audits.
In our opinion, such financial statement schedule, when considered in relation
to the basic consolidated financial statements taken as a whole, presents
fairly, in all material respects, the information set forth therein.
KPMG Audit Plc
Chartered Accountants
Registered Auditor
July 14, 1999 London, England
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DANKA BUSINESS SYSTEMS PLC
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
(In Thousands)
Column A Column B Column C Column D Column E
---------- --------------- --------------------------------- -------------- ----------
Balance at Charged to Charged to Balance
Beginning of Costs and Other at End
Description Period Expenses Accounts (1) Deductions (2) of Period
----------- --------------- ------------ ------------ -------------- ---------
Allowance for doubtful accounts:
Year ended March 31, 1997 $ 8,804 $21,062 $ 12,382 $(14,395) $27,853
======= ======= ======== ======== =======
Year ended March 31, 1998 $27,853 $29,928 $ 2,046 $(28,854) $30,973
======= ======= ======== ======== =======
Year ended March 31, 1999 $30,973 $38,619 $ 447 $ (8,774) $61,266
======= ======= ======== ======== =======
(1) Represents beginning balances of acquired companies.
(2) Represents accounts written off during the year, net of recoveries.
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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.
Date: July 14, 1999 DANKA BUSINESS SYSTEMS PLC
--------------------------
(Registrant)
By: /s/ LARRY K. SWITZER
--------------------------------------------
Larry K. Switzer, Chief Executive Officer
(Chief Executive Officer)
By: /s/ F. MARK WOLFINGER
--------------------------------------------
F. Mark Wolfinger, Executive Vice
President and Chief Financial Officer
(Chief Financial Officer and the
Principal Accounting Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934,
this Report has been signed by the following persons on behalf of the Company
and in the capacities indicated on July 14, 1999.
SIGNATURE TITLE
- --------- -----
/s/ DAVID W. KENDALL Chairman and Director
- ---------------------------
David W. Kendall
/s/ LARRY K. SWITZER Chief Executive Officer and Director
- ---------------------------
Larry K. Switzer
/s/ BRIAN L. MERRIMAN President and Chief Operating Officer and Director
- ---------------------------
Brian L. Merriman
/s/ KEITH J. MERRIFIELD Director
- ---------------------------
Keith J. Merrifield
/s/ J. ERNEST RIDDLE Director
- ---------------------------
J. Ernest Riddle
/s/ JAMES F. WHITE, JR. Director
- ---------------------------
James F. White, Jr.
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