|
Foreign Currency Exposures
The Company’s Belgium operation
enters into forward foreign currency exchange contracts to hedge certain
foreign currency denominated receivables and payables, principally for
transactions in non-euro zone countries. Exchange gains and losses arising
from these transactions are deferred and recognized when the transaction
for which the hedge was obtained is finalized. At December 31, 2000 and
1999, the Company had outstanding forward foreign currency exchange contracts
aggregating $7,270,000 and $7,921,000, respectively. The introduction
of the “euro” on January 1, 1999, by the European Economic and
Monetary Union has reduced the exposure to currency fluctuations among
participating countries resulting in reduced volume of forward foreign
currency exchange contracts. Forward foreign currency exchange contracts
generally have maturities of less than nine months and relate primarily
to major Western European currencies. Counterparties to the forward foreign
currency exchange contracts are major financial institutions. Credit loss
from counterparty nonperformance is not anticipated. Based on quoted year-end
market prices of its forward foreign currency exchange contracts, the
Company would not have experienced material gains or losses at December
31, 2000, and 1999, had outstanding contracts been settled at those respective
dates.
The Company has a one-third interest
in a Brazilian joint venture, ITAP/Bemis Ltda. The joint venture
has foreign denominated debt exposures that are substantially hedged.
Net conversion losses on the debt are recorded as an expense.
Return to Top
Income Taxes
The Company’s effective tax
rate was 38.3 percent in 2000 versus 38.3 percent in 1999 and 38.7 percent
in 1998. The difference between the Company’s overall tax rate and
the U.S. statutory tax rate of 35 percent in 2000, 1999, and 1998 principally
relates to state and local income taxes net of the federal income tax
benefit.
Return to Top
New Accounting Pronouncements
In June 1998, the Financial
Accounting Standards Board (FASB) issued SFAS No. 133, “Accounting
for Derivative Instruments and Hedging Activities.” This statement,
which is required to be adopted for annual periods beginning after
June 15, 2000, establishes standards for recognition and measurement
of derivatives and hedging activities. Implementation of this standard
on January 1, 2001, will not have a material effect on the Company’s
financial position or results of operation.
Return to Top
Market Prices and Dividends
The Bemis quarterly dividend was
increased by 4.3 percent in the first quarter of 2000 to 24 cents per
share from 23 cents. This followed first quarter increases of 4.5 percent
in 1999 to 23 cents per share from 22 cents, and 10.0 percent in 1998
to 22 cents per share from 20 cents in 1997.
Common dividends for 2000 were
96 cents per share, up from 92 cents in 1999 and 88 cents in 1998. The
2000 dividend payout ratio was 39.3 percent compared to 42.2 percent in
1999 and 46.3 percent in 1998. Based on the market price of $34.88 per
share at the beginning of 2000, the dividend yield was 2.8 percent.
Stockholders’ equity per common
share (book value per share) increased to $15.18 per share in 2000, up
from $13.91 per share in 1999 and $13.16 per share in 1998. Trading volume
in Bemis common stock was 41.6 million shares in 2000.
In February 2001, the Board of
Directors increased the quarterly cash dividend on common stock
to 25 cents per share from 24 cents, a 4.2 percent increase.
Return to Top
Forward-Looking Statements
This Annual Report contains certain estimates, predictions,
and other “forward-looking statements” (as defined in the Private
Securities Litigation Reform Act of 1995, and within the meaning of Section
27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Act of 1934). The words “believe,” “expect,”
“anticipate,” “intend,” “estimate,” “target,”
“may,” “will,” “plan,” “project,”
“should,” “continue,” or the negative thereof or other
similar expressions, or discussions of future goals or aspirations, which
are predictions of or indicate future events and trends and which do not
relate to historical matters, identify forward-looking statements. Such
statements are based on information available to management as of the
time of such statements and relate to, among other things, expectations
of the business environment in which the Company operates, projections
of future performance, perceived opportunities in the market, and statements
regarding the Company’s mission and vision. Forward-looking statements
involve known and unknown risks, uncertainties, and other factors, which
may cause the actual results, performance, or achievements of the Company
to differ materially from anticipated future results, performance, or
achievements expressed or implied by such forward-looking statements.
The Company undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information, future
events, or otherwise.
Factors that could cause actual results to differ from
those expected include, but are not limited to, general economic conditions
such as inflation, interest rates, and foreign currency exchange rates;
results from acquisitions may differ from what we anticipate; competitive
conditions within the Company’s markets, including the acceptance
of new and existing products offered by the Company; price changes for
raw materials and the ability of the Company to pass these price changes
on to its customers or otherwise manage commodity price fluctuation risks;
the presence of adequate cash available for investment in the Company’s
business in order to maintain desired debt levels; unanticipated consequences
of the European Monetary Union’s conversion to the euro; changes
in governmental regulation, especially in the areas of environmental,
health and safety matters, and foreign investment; unexpected outcomes
in the Company’s current and future litigation proceedings; and changes
in the Company’s labor relations. These and other risks, uncertainties,
and assumptions identified from time to time in the Company’s filings
with the Securities Exchange Commission, including without limitation,
its Annual Report on Form 10-K and its quarterly reports on Form 10-Q,
could cause the Company’s actual future results to differ materially
from those projected in the forward-looking statements. In addition, the
Company’s actual future results could differ materially from those
projected in the forward-looking statement as a result of changes in the
assumptions used in making such forward-looking statements.
Return to Top
|
Business
Financial
Statement
