VAN NUYS, Calif. -- May 1, 1996 -- href="chap11.cherokee.html">Cherokee Inc.
(NASDAQ: CHKE) today announced that its Board of Directors has
declared a tax-free return of capital (the "distribution") to its
shareholders of record as of the close of business day May 15, 1996,
which distribution will be made in accordance with section 316 of
the Internal Revenue Code on May 30, 1996. The amount of such
distribution will be subject to final Board approval, cash
availability on payment date, fourth quarter results and the
completion of certain of Cherokee's strategic plans by such date.
Currently, Cherokee anticipates that such distribution will be no
less than $0.50 per share and no more than $1.35 per share.
After consideration of Cherokee's achievements during the
current fiscal year, the Board of Directors had amended Cherokee's
Management Agreement with The Wilstar Group. During the year,
Cherokee has effectively liquidated substantially all of its
inventory, eliminated all debt, negotiated and consummated the sale
of its Uniform Division, favorably settled all debtor claims,
retired 475,000 shares held by the Disbursing Agent for distribution
to holders of trade claims, and entered into nine new licensing
agreements, including a major licensing agreement with Target Stores
which will provide substantial revenues to Cherokee through the year
2001. In connection with the foregoing, Cherokee has also reduced
its overhead from an annual rate of approximately $24,250,000 to a
current rate of $3,300,000.
In light of these accomplishments and Cherokee's vastly improved
financial condition, the Management Agreement was revised to
accelerate the vesting of Wilstar's performance options so that
Wilstar has been immediately vested in its right to purchase up to
20% of Cherokee's Diluted Common Stock at $0.02 per share. In
connection with the foregoing, Wilstar agreed to relinquish its
rights to purchase up to an additional 2.5% of Cherokee's Diluted
Common Stock pursuant to the performance options. Wilstar has
exercised the performance options in full and purchased 1.675
million shares.
Cherokee will be accounting for this transaction as a non-cash
charge to earnings. The Board determined that this revision would
serve to both compensate Wilstar and to align the ongoing interests
of Wilstar with Cherokee. As a result of the foregoing, including
the retirement of the 475,000 shares, Cherokee currently has
outstanding approximately 7,641,000 shares.
Cherokee also announced that it has reached an agreement in
principal for the sale of all of its trademark rights in Japan to
Suzuya Co. Ltd. for $3,500,000. Currently, Cherokee has a
licensing agreement with Suzuya terminating in November 1997,
pursuant to which Suzuya has an exclusive right to license the
Cherokee trademark in Japan and six other territories. In
connection with the proposed agreement, Suzuya will terminate its
rights in these territories.
Robert Margolis, Chairman and CEO of Cherokee, stated that
during the past year much effort was devoted to revitalizing
Cherokee's balance sheet, completing the settlement of all
bankruptcy claims and liquidating the assets of the "old Cherokee."
Margolis added that Cherokee's licensing strategy has met with
tremendous initial success, which he believes will be the
cornerstone for its ongoing growth. During fiscal 1997, he
estimates that Cherokee's earnings from operations, on a diluted
basis, will be approximately $0.60 to $0.80 per share.
Margolis further noted, however, that any earnings in excess of
$0.60 per share during fiscal 1997 would be based upon Cherokee's
estimates of anticipated licensing revenues above the minimum
guarantees set forth in existing contracts. To the extent Cherokee
did not obtain such revenues or its overhead costs are greater than
anticipated, actual results could vary materially from the estimated
results set forth above.
Cherokee Inc., based in Van Nuys, California is a marketer and
licenser of the Cherokee brand products. The Company currently has
27 continuing licensing agreements worldwide.
CONTACT: Cherokee Inc.
Carol Gratzke, 818/908-9868
or
Financial Relations Board
Tom Ekman, 310/442-0599 (analysts)
Daniel Saks/Fiona Ross, 310/442-0599 (gen. info)
CORNING, N.Y. -- April 15, 1996 -- Corning
Incorporated (NYSE:GLW) said today that its first quarter net income
totaled $71.8 million, or $0.31 per share.
This compares with adjusted first quarter 1995 earnings of $82.9
million or $0.36 per share. Adjustments to the 1995 results include
the previously announced change to Corning's accounting calendar,
effective January 1, 1996, and the elimination of equity earnings
from Dow Corning Corporation following
its Chapter 11 filing in the
second quarter of 1995. Reported earnings for the first quarter of
1995 were $79.4 million, or $0.35 per share.
The trend in first quarter net income was similar to the fourth
quarter of 1995. Strong growth in the Opto-electronics businesses
and at Corning Pharmaceutical Services was more than offset by lower
earnings at Corning Clinical Laboratories.
First quarter sales totaled $1.35 billion, an increase of 6
percent over adjusted 1995 levels.
Equity earnings declined from adjusted 1995 levels primarily due
to scheduled glass furnace repairs at Samsung-Corning Company LTD.
Board Chairman James R. Houghton said, "In spite of the
earnings decline, our first quarter was encouraging. As we look
ahead, we expect continued strength in our growth businesses as well
as improving earnings comparisons at Corning Clinical Laboratories."
Corning Incorporated is a Fortune 500 company whose businesses
are at the leading edge of the technologies that comprise three of
the fastest growing segments of the global economy
-- Communications, Environment and Life Sciences. Its 1995 sales
totaled $5.3 billion.
Corning Incorporated and Subsidiary Companies
Consolidated Statements of Income
(In millions, except per-share amounts)
Quarter Ended Twelve Weeks Ended
March 31, 1996 March 26, 1995
(Unaudited)
Revenues
Net sales $1,352.6 $ 1,116.1
Royalty, interest and
dividend income 8.8 6.9
1,361.4 1,123.0
Deductions
Cost of sales 873.2 713.6
Selling, general and
administrative expenses 283.3 221.5
Research and development
expenses 46.1 38.6
Interest expense 29.8 26.0
Other, net 8.1 15.4
Income before taxes on income 120.9 107.9
Income tax expense 44.8 39.9
Income before minority interest
and equity earnings 76.1 68.0
Minority interest in
earnings of subsidiaries (12.5) (11.3)
Dividends on convertible preferred
securities of subsidiary (3.4) (3.2)
Equity in earnings of associated
companies:
Other than Dow Corning
Corporation 11.6 8.4
Dow Corning Corporation 17.5
Net Income $ 71.8 $ 79.4
Earnings Per Common Share:
Net Income $ 0.31 $0.35
Dividends Declared $ 0.18 $ 0.18
Weighted Average Shares
Outstanding 227.2 225.4
The accompanying notes are an integral part of these statements.
Corning Incorporated and Subsidiary Companies
Condensed Consolidated Balance Sheets
(In millions)
March 31, 1996 Dec. 31, 1995
(Unaudited)
Assets
Current Assets
Cash and short-term investments $ 164.3 $ 214.9
Receivables, net 971.4 932.4
Inventories 515.0 467.8
Deferred taxes on income and
other current assets 216.1 219.2
Total current assets 1,866.8 1,834.3
Investments 349.2 376.1
Plant and Equipment, Net 2,115.7 2,031.6
Goodwill and Other Intangible Assets, Net 1,420.9 1,416.1
Other Assets 304.5 329.0
$ 6,057.1 $ 5,987.1
Liabilities and Stockholders' Equity
Current Liabilities
Loans payable $ 271.3 $ 146.0
Accounts payable 189.4 255.2
Other accrued liabilities 725.2 763.9
Total current liabilities 1,185.9 1,165.1
Other Liabilities 671.7 664.9
Loans Payable Beyond One Year 1,385.8 1,393.0
Minority Interest in Subsidiary Companies 290.9 272.5
Convertible Preferred Securities of Subsidiary364.8 364.7
Convertible Preferred Stock 23.6 23.9
Common Stockholders' Equity 2,134.4 2,103.0
$ 6,057.1 $ 5,987.1
(1) Effective January 1, 1996 Corning made several changes to its
accounting calendar to make Corning's results more comparable with
other companies and to enable Corning to report results of certain
subsidiaries on a more current basis.
First, Corning adopted an annual reporting calendar. Previous
years operated on a fiscal year ending on the Sunday nearest
December 31. As a result, Corning's 1996 quarters will include
results for
three calendar months while Corning's quarters previously included
results for 12 weeks (16 weeks in the third quarter).
Second, Corning's 1996 quarters will include three months of
operations for all significant subsidiaries and affiliates.
Previously, certain subsidiaries reported two months of results in
the first quarter and four months of results in the third quarter.
Third, Corning Life Sciences, Inc. and certain other
consolidated subsidiaries that previously reported on a fiscal year
ending November 30 adopted a calendar year end. The December 1995
results of these subsidiaries were recorded in retained earnings
during the first quarter of 1996.
First quarter 1995 financial statements were not restated. The
following table presents unaudited pro forma results for the first
quarter 1995 as if this change had occurred at the beginning of 1995
(in millions):
Total Excluding Dow
Company Corning Corporation
Sales $ 1,279.0 $ 1,279.0
Net Income $ 100.4 $ 82.9
Net Income Per Common
Share $ 0.44 $0.36
(3) Depreciation and amortization charged to operations during the
first quarters of 1996 and 1995 totaled $109.1 million and $88.1
million, respectively.
CONTACT: Corning Incorporated, Corning
Kathryn C. Littleton, (607) 974-8206
Paul A. Rogoski, (607) 974-8832
Investor Relations Contact:
Richard B. Klein, (607) 974-8313
Katherine M. Dietz, (607) 974-8217
MIDLAND, Mich., April 25, 1996 - The following was
released by Dow Chemical Company (NYSE: DOW):
First Quarter of 1996 Highlights
(In millions, except for per share amounts)
3 Months Ended
Mar. 31
1996 1995
Net Sales $4,982 $5,205
Operating Income 868 1,075
Income from Continuing Operations 476 564
Earnings per Common Share 1.90 2.03
from Continuing Operations
Earnings Per Common Share 1.90 2.10
Review of Quarterly Results
The Dow Chemical Company today announced sales of $5.0 billion
for the first quarter of 1996. Net income from continuing
operations was $476 million, and earnings from continuing operations
were $1.90 per share, down 6 percent from $2.03 a year ago. Sales
were off 4 percent from $5.2 billion for the same period a year ago.
A 7 percent decline in prices was partially offset by a 3 percent
increase in volume. Operating income was $868 million, down 19
percent from $1.1 billion a year ago. Total earnings, which include
the results from discontinued pharmaceutical operations, were $1.90
per share versus $2.10 for the first quarter of 1995.
"We are very pleased with our first quarter results," said J.
Pedro Reinhard, Dow's financial vice-president and chief financial
officer. "Our balanced product portfolio and the realization of our
on- going productivity improvements buffered the decline in
commodity prices which occurred over the last six months."
Chemicals and Metals recorded sales of $752 million, off 13
percent from $861 million a year ago. Operating income was $190
million compared to $304 million in the first quarter of 1995.
Lower prices for vinyl chloride monomer (VCM), coupled with a
slowdown in the pulp and paper industry, impacted this segment's
results.
Performance Chemicals sales declined 6 percent to $1.1 billion,
while operating income at $247 million was basically flat compared
to a year ago. The Specialty Chemicals business remained strong,
posting higher sales and earnings compared to the first quarter of
1995. This offset lower results for Agricultural Chemicals which
were impacted by a delayed planting season in North America caused
by the extremely cold weather. It is expected that the second
quarter will benefit from these delayed sales.
Plastics sales were down 15 percent to $928 million. Operating
income was $170 million compared to $451 million in the first
quarter of 1995. Prices were down 27 percent, compared to the same
period last year. However, by quarter's end, prices began trending
upward due to increased demand in all geographic markets.
Performance Plastics experienced a strong quarter with sales of
$1.3 billion, up 6 percent from the same period a year ago.
Operating income increased 72 percent to $317 million compared to
$184 million during the first quarter of 1995. All businesses in
this segment posted very strong gains.
Hydrocarbons and Energy sales were $553 million, down 6 percent
from $588 million in the first quarter of 1995. The segment posted
an operating loss of $9 million versus an operating loss of $12
million a year ago.
The Diversified Businesses and Unallocated segment achieved
sales of $273 million, up 33 percent versus $205 million a year ago.
Sales from Radian International LLC, Dow's environmental management
subsidiary, contributed to the revenue increase. This segment
posted an operating loss of $47 million, a $58 million improvement
compared to an operating loss of $105 million in the first quarter
of 1995. Substantially better performance at DowBrands contributed
to the stronger results.
"Our long-term strategy for success is beginning to create
results. Our value-growth initiatives are positively contributing to
our earnings and we continue to make productivity gains. Indeed, we
are on-target to meet our cost reduction goals for 1996. Our
efforts, along with the current favorable supply and demand
balances, should result in another good year," said Reinhard.
The Dow Chemical Company and Subsidiaries
Consolidated Statements of Income
(Unaudited)
-------------------------------------------------------------------
In millions, except for Three Months Ended
per share amounts Mar. 31, 1996 Mar. 31, 1995
-------------------------------------------------------------------
Net Sales $4,982 $5,205
-------------------------------------------------------------------
Operating Costs and Expenses
Cost of sales 3,384 3,326
Insurance and finance company
operations, pretax income (22) (13)
Research and development expenses 191 213
Promotion and advertising expenses 85 117
Selling and administrative expense 467 476
Amortization of intangibles 9 11
--------------------------------------------------------------
Total operating costs and expenses 4,114 4,130
-------------------------------------------------------------------
Operating Income 868 1,075
-------------------------------------------------------------------
Other Income (Expense)
Equity in earnings of 20%-50%
owned companies 16 25
Interest expense and amortization
of debt discount (124) (101)
Interest income and foreign
exchange - net 75 38
Sundry income - net 48 11
--------------------------------------------------------------
Total other income (expense) 15 (27)
-------------------------------------------------------------------
Income before Provision for Taxes
on Income and Minority Interests 883 1,048
-------------------------------------------------------------------
Provision for Taxes on Income 326 414
-------------------------------------------------------------------
Minority Interests' Share in Income 79 68
-------------------------------------------------------------------
Preferred Stock Dividends 2 2
-------------------------------------------------------------------
Income from Continuing Operations 476 564
-------------------------------------------------------------------
Discontinued Operations
Income from pharmaceutical business
net of taxes on income - 18
Gain on sale of pharmaceutical businesses,
net of taxes on income - -
-------------------------------------------------------------------
Net Income Available for
Common Stockholders $476 $582
-------------------------------------------------------------------
Average Common Shares Outstanding 251.0 276.9
Earnings per Common Share from
Continuing Operations $1.90 $2.03
Earnings per Common Share $1.90 $2.10
Common Stock Dividends
Declared per Share $0.75 $0.65
Depreciation $308 $334
Capital Expenditure $264 $203
-------------------------------------------------------------------
Note A: The unaudited interim financial statements reflect all
adjustments (consisting of normal recurring accruals) which, in the
opinion of management, are considered necessary for a fair
presentation of the results for the period covered. Certain
reclassifications of prior year amounts have been made to conform to
current year presentation. These statements should be read in
conjunction with the financial statements and notes thereto included
in the Company's Form 10-K for the year ended December 31, 1995.
CONTACT: Darlene MacKinnon of Dow Chemical, 517-636-2876
Bay Area Bancshares Announces
Addition To Nonperforming Assets
REDWOOD CITY, Calif. -- May 1, 1996 -- Robert R.
Haight, chairman of the board of Bay Area Bancshares (Bulletin
Board:BYAR) today announced that Bay Area Bancshares' sole
subsidiary, Bay Area Bank, has reclassified $837,000 in lease
receivables and notes as nonperforming assets and has suspended
accruing interest on these assets.
These assets consist of approximately 150 lease receivables and
notes purchased in 1994 from Bennett
Group Funding Inc. and in 1995
from Bennett Leasing Inc. ("Bennett") which both declared Chapter 11
Bankruptcy in the past month.
There have been reports by national news services of alleged
fraudulent leases that were written by Bennett. Bay Area
Bancshares, however, is not aware that any of its Bennett leases or
notes are fraudulent. The company's current information is that the
allegations of fraud are directed at a small percentage of all
Bennett leases and notes.
The company expects to have more information on the authenticity
of these assets in the coming weeks. In the interim the company
believes it to be prudent to reclassify all Bennett assets to
nonperforming status until an official accounting is finished by the
bankruptcy trustee.
The bank has reviewed its loan loss reserve and believes it to
be adequate up to the full amount of the Bennett Funding Assets
currently owned. With the addition of these assets to nonperforming
status the bank has approximately $1,597,000 in non-performing
assets. The bank's loan loss reserve is currently 2.32% of total
gross loans and the loan loss reserve coverage ratio is 100% of
nonperforming assets.
Bay Area Bancshares' sole subsidiary is Bay Area Bank, the only
independent commercial bank based in Redwood City.
CONTACT: Bay Area Bank, Redwood City
John Brooks or Anthony Gould, 415/367-1600
$250-MILLION BANKRUPTCY CREATES REORGANIZED COMPANY, NRG
GENERATING (U.S.), INC.
NEWARK, N.J., May 1, 1996 - Sills Cummis Zuckerman Radin
Tischman Epstein & Gross, P.A., today announced successful
completion of the $250-million reorganization of href="chap11.obrien.html">O'Brien
Environmental Energy, Inc., now operating under the name, NRG
Generating (U.S.), Inc., which is a developer, owner, and operator
of cogeneration and alternative fuel projects and is affiliated with
Northern States Power of Minneapolis, Minnesota.
The reorganization and auction process was successfully
completed in the short period of 18 months under the supervision of
John Kelly of Glass & Associates, a well-known crisis manager and
work-out specialist brought in to maximize the debtor's value and
the New Jersey law firm of Sills Cummis Zuckerman Radin Tischman
Epstein & Gross, P.A.
The reorganization provides satisfaction or reinstatement of
more than $100 million in claims of secured and unsecured creditors,
including a cash payment of approximately $93 million in
satisfaction of 100% of allowed claims. Holders of equity in
O'Brien received a cash payment of $7.5 million and approximately
58% of the common stock of the reorganized company.
A 42% percent interest in the reorganized company was
simultaneously acquired by Northern States Power Company's wholly-
owned subsidiary, NRG Energy, Inc. Shares in the new entity are
expected to trade publicly in the future.
Bankruptcy Approach
"The bankruptcy auction was an outgrowth of a long search for a
strategic alliance with a significant company in the power
industry," comments Steven E. Gross, Managing Partner of Sills
Cummis. "More than a dozen parties expressed serious interest,
including power companies located in New Jersey and several other
states across the U.S. Through a complicated process of bidding and
due diligence, a subsidiary of Northern States Power Company, of
Minneapolis, Minnesota, emerged as the successful bidder." Sills
Cummis coordinated the actions of more than 30 law firms, consulting
firms and investment advisors to enable completion of this
transaction.
"Utilizing the bankruptcy auction method, we enabled a company
with strong fundamentals, valuable assets and a ready market for its
product to return to financial health while also providing payment
to creditors and previous owners," stated Mr. Kelly of Glass &
Associates, the court appointed crisis manager.
Firm Enters Purchase Agreement with Jersey Central Power & Light
The New Jersey Board of Public Utilities has approved revised
power purchase agreements between NRG Generating and Jersey Central
Power & Light for NRG Generating's 122 megawatt cogeneration plant
at the DuPont facility in Parlin, New Jersey, and its 52 megawatt
cogeneration plant at the Newark Group Industries facility in
Newark, New Jersey.
Savings to Ratepayers Cited
"These power purchase agreements will favorably affect Jersey
Central Power & Light Company's purchased power costs and its rates
charged to customers," says Mr. Gross. "According to Jersey Central
Power & Light savings will likely exceed approximately $50 million
over the life of the power agreements."
Sills Cummis Zuckerman Radin Tischman Epstein & Gross, P.A.,
Newark, N.J., is a corporate law firm with more than 135 attorneys
in Newark, Atlantic City, and New York City. The Firm has
represented independent power producers in finance and regulatory
matters and has advised many of the world's leading companies in the
banking, biotechnology, gaming, health care, medical device,
insurance, manufacturing, pharmaceutical, real estate, and high tech
fields. The Firm was founded in 1971.
CONTACT: Steven E. Gross or R. Max Crane, both of Sills Cummis
Zuckerman Radin Tischman Epstein & Gross, P.A., 201-643-7000