Delaware 1-9076 13-3295276 --------------------------------------------------------------------------- (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.)
Registrant's press releases dated September 29, 1998 are filed herewith as Exhibits 20a and 20b and are incorporated herein by reference.
20a. Press release of Registrant dated September 29, 1998.
20b. Press release of Registrant dated September 29, 1998.
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Current Report to be signed on its behalf by the undersigned thereunto duly authorized.
Mark Hausberg Vice President and Treasurer
Date: September 29, 1998
Sequentially Exhibit Numbered Page ------- ------------- 20a. Press release of Registrant dated September 29, 1998. 20b. Press release of Registrant dated September 29, 1998.
Contact: Media Relations: Investor Relations Clarkson Hine Anthony J. Diaz (203) 698-5148 (203) 698-5553
Old Greenwich, CT, September 29, 1998 - Fortune Brands, Inc. (NYSE-FO), the consumer products company, today announced a 5% increase in the dividend, reflecting strong earnings growth, and increased share repurchases.
The dividend on the Common stock will increase to an indicated annual rate of 88 cents per share (22 cents per quarter) from 84 cents (21 cents per quarter). The dividend is payable on December 1 to stockholders of record on November 11. This increase is the second since Fortune Brands began trading on the New York Stock Exchange, just 16 months ago.
The Company also noted that, in response to the recent market decline, it has increased share repurchases. Overall, Fortune Brands has repurchased a total of 2.5 million shares thus far in 1998, including 1.6 million shares since June 30. This includes purchases made under a routine share purchase authorization as well as under the Company's previously announced Systematic Share Purchase Program.
"Fortune Brands' prospects are very positive," noted Chairman and Chief Executive Officer Thomas C. Hays. "The dividend increase and stepped-up share repurchases reflect our confidence in those prospects. The actions also reflect a balanced strategy, supported by powerful consumer brands (more than 80% of sales are generated by brands that are number 1 or 2 in their markets) and strong financial resources. Together, these are driving substantial earnings growth, add-on acquisitions, share repurchases and dividend increases.
"Overall, our operations have continued to perform well this year, with diluted E.P.S. up 14% for the first six months. We expect to report double-digit growth in the third quarter, and for the full year, assuming no further deterioration in the economic and business environment, we expect to achieve E.P.S. growth around 13%. So, we are having another very good year."
Hays also noted that "on a cash basis, excluding about 58 cents of goodwill amortization for the full year, our earnings are substantially higher than our reported earnings. The payout ratio based on cash earnings is around 39%, which is in line with other leading consumer products companies.
"We are encouraged by the ongoing strength of operations," Hays added.
"The power of the brands, the contribution of eight recent add-on acquisitions
and considerable progress on initiatives to reduce costs have been driving
substantial growth, despite intense competition. And while intensified pressures
in the golf club market are particularly affecting Cobra, the club category
accounts for only about 5% of our operating contribution. Titleist clubs have
been countering the trend with significant growth.
"So we remain optimistic about our prospects, both for 1998 and long-term, and that optimism underlies today's announcement."
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Fortune Brands, Inc. is a consumer products company with headquarters in Old
Greenwich, Connecticut. Its operating companies have premier brands and leading
market positions in home and office products, golf equipment and distilled
spirits. Home and office brands include Moen faucets, Master locks and
Aristokraft and Schrock cabinets sold by units of MasterBrand Industries and
Day-Timer and Swingline sold by units of ACCO World Corporation. Acushnet
Company's golf brands include Titleist, Cobra and FootJoy. Major spirit and wine
brands sold by units of Jim Beam Brands Worldwide, Inc. include Jim Beam and
Knob Creek Bourbon, DeKuyper cordials, Whyte & Mackay Scotch and Geyser Peak and
Canyon Road wines.
This press release contains statements relating to future results, which are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected as a result of certain risks and uncertainties, including but not limited to changes in general economic conditions, foreign exchange rate fluctuations, competitive product and pricing pressures, the impact of excise tax increases with respect to distilled spirits, regulatory developments, the uncertainties of litigation, changes in golf equipment regulatory standards, the impact of weather, particularly on the home products and golf brand groups, expenses and disruptions related to shifts in manufacturing to different locations and sources, delays in the integration of recent acquisitions, as well as other risks and uncertainties detailed from time to time in the Company's Securities and Exchange Commission filings.
Contact: Media Relations: Investor Relations Clarkson Hine Anthony J. Diaz (203) 698-5148 (203) 698-5553 FORTUNE BRANDS ELECTS WESLEY PRESIDENT AND CHIEF OPERATING OFFICER, LUDES VICE CHAIRMAN EFFECTIVE JANUARY 1; WESLEY AND KLEMANN ELECTED TO BOARD
Old Greenwich, CT, September 29, 1998 -- Fortune Brands, Inc. (NYSE-FO), the consumer products company, today announced that Norman H. Wesley, 48, has been elected President and Chief Operating Officer and a member of the Board of Directors and Executive Committee effective January 1, 1999. Earlier today, the Company also announced a 5% increase in the dividend. Wesley has led Fortune Brands' home and office businesses since April 1997 and will continue to do so in addition to his responsibility as President and Chief Operating Officer. Wesley will succeed John T. Ludes, 62, who will become Vice Chairman, a new position.
Fortune Brands Chairman and Chief Executive Officer Thomas C. Hays noted that "these moves set the stage for an orderly management transition at Fortune Brands. John Ludes and I both plan to retire at the close of 1999 when I will be a few months from my 65th birthday, and today's announcement demonstrates the Board's confidence in Norm Wesley as it looks to the future leadership of the Company.
"I have enjoyed working as a team with John Ludes in developing Fortune Brands as a strong consumer products company with leading positions in growing categories. We are having an excellent year in 1998, and as we look forward to 1999 and beyond, John and I have great confidence in the future of Fortune Brands due to its strong management throughout the organization.
"Over the 11 years that he's been associated with our Company, Norm has performed superbly well in a series of key assignments, including nine years as Chief Executive Officer of our office products business. Most recently, he has led our home and office businesses to strong growth, capitalizing on overall opportunities while also successfully integrating high return add-on acquisitions. Under Norm's leadership, the home and office brands, which generated 55% of our 1997 sales, have flourished." The Company also announced that Gilbert L. Klemann, II, 48, has been elected Executive Vice President Corporate and a member of the Board of Directors, effective January 1, 1999. He has been Executive Vice President - Strategic and Legal Affairs since January 1, 1998. With the election of Wesley and Klemann, the Board will expand to 15 members.
"Gil Klemann continues to substantially enhance our corporate operations and strategy," Hays noted. "Gil has brought strong executive skills, initially to our legal affairs and more recently to corporate development and strategic planning as well. Moving forward, the chief administrative officer will also report to Gil."
Wesley was elected Chairman and Chief Executive Officer of Fortune Brands Home and Office in 1997. He joined ACCO in 1984 as Vice President - Corporate Development, was elected President and Chief Operating Officer in January 1987, and President and Chief Executive Officer effective January 1990. Prior to joining ACCO, he was Vice President and General Manager for the Crown Zellerbach Office Products Group. He earned a B.S. in finance from the University of Utah, and an M.B.A., magna cum laude, from the same institution. He lives in Lake Forest, Illinois with his wife, Kim, and three daughters, and plans to relocate to the Fairfield County, Connecticut area.
Prior to his election, effective January 1, 1998, as Executive Vice President - Strategic & Legal Affairs, Gil Klemann had served since 1991 as Senior Vice President and General Counsel and had been involved extensively in handling the Company's legal affairs since 1976. Prior to joining the Company in 1991, he was a partner in the law firm of Chadbourne & Parke. He joined Chadbourne in 1975, became a partner in 1983 and served as a member of Chadbourne's management committee from 1987. He holds an A.B. from the College of the Holy Cross and a J.D. from Fordham University. He and his wife, Patricia, reside in Greenwich, Connecticut, and have two children.
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Fortune Brands, Inc. is a consumer products company with headquarters in Old Greenwich, Connecticut. Its operating companies have premier brands and leading market positions in home and office products, golf equipment and distilled spirits. Home and office brands include Moen faucets, Master locks and Aristokraft and Schrock cabinets sold by units of MasterBrand Industries and Day-Timer and Swingline sold by units of ACCO World Corporation. Acushnet Company's golf brands include Titleist, Cobra and FootJoy. Major spirit and wine brands sold by units of Jim Beam Brands Worldwide, Inc. include Jim Beam and Knob Creek Bourbon, DeKuyper cordials, Whyte & Mackay Scotch and Geyser Peak and Canyon Road wines.