SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): AUGUST 11, 2008
THE ARISTOTLE CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
(STATE OR OTHER JURISDICTION
96 CUMMINGS POINT ROAD, STAMFORD, CONNECTICUT
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
(REGISTRANTS TELEPHONE NUMBER, INCLUDING AREA CODE)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 2.02 Results of Operations and Financial Condition.
On August 11, 2008, The Aristotle Corporation issued a press release announcing financial results for the quarter ended June 30, 2008, a copy of which is attached as Exhibit 99.1.
Item 9.01 Financial Statements and Exhibits
Exhibit 99.1 - Press release of The Aristotle Corporation, dated August 11, 2008.
The information in this Form 8-K and the Exhibit attached hereto shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, unless expressly set forth by specific reference in such filing.
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
THE ARISTOTLE CORPORATION
By: /s/ H. William Smith
Name: H. William Smith
Title: Vice President, General Counsel
Date: August 11, 2008
Exhibit 99.1 Press release issued August 11, 2008.
For Immediate Release
Bill Smith or Dean Johnson
The Aristotle Corporation
Phone: (203) 358-8000 or (920) 563-2446
Fax: (203) 358-0179 or (920) 563-0234
The Aristotle Corporation Announces
2008 Second Quarter and Six Month Results
Stamford, CT, August 11, 2008 - The Aristotle Corporation (NASDAQ: ARTL; ARTLP) announced today its results of operations for the second quarter and six months ended June 30, 2008.
For the second quarter ended June 30, 2008, net earnings applicable to common stockholders were $4.5 million, or $.25 per diluted common share, versus $3.9 million, or $.23 per diluted common share, in the second quarter of 2007. Net earnings applicable to common stockholders for the first six months of 2008 were $7.3 million, or $.41 per diluted common share, compared to $6.3 million, or $.36 per diluted common share, for the comparable six months of 2007.
Second quarter net sales in 2008 increased 1.1% to $56.8 million from $56.2 million in the second quarter of 2007. Earnings from operations improved by 9.2% in the second quarter of 2008 to $10.5 million (including a $.7 million insurance recovery), equating to 18.6% of net sales. In the same quarter of 2007, earnings from operations totaled $9.7 million, or 17.2% of net sales.
For the six months ended June 30, 2008, net sales increased 2.7% to $107.2 million from $104.4 million for the six months ended June 30, 2007. Earnings from operations increased 9.6% to $18.6 million (including the insurance recovery) in the first six months of 2008, or 17.4% of net sales. In comparison, earnings from operations for the first six months of 2007 were $17.0 million, or 16.3% of net sales.
Steven B. Lapin, Aristotles President and Chief Operating Officer, stated, Your Company is pleased to report net sales increases for the 2008 second quarter and year-to-date versus the comparable 2007 periods despite this years general economic slowdown throughout the U.S., and that, as a result of managements diligent attention to cost controls, the growth in operating income has continued to exceed the growth in net sales.
Dean T. Johnson, Aristotles Chief Financial Officer, added, Gross margins for the three and six month periods ended June 30, 2008 were 39.3% and 39.4%, respectively, compared to 38.4% and 38.8% in the same periods of 2007. The improvement in 2008 is primarily due to managements purchasing strategies implemented in the fourth quarter of 2007 and first quarter of 2008 which have been designed to maximize returns on inventory investments and to limit effects of petroleum-related cost increases.
The Aristotle Corporation, founded in 1986, and headquartered in Stamford, CT, is a leading manufacturer and global distributor of educational, health, medical technology and agricultural products. A selection of over 80,000 items is offered, primarily through more than 45 separate catalogs carrying the brand of Nasco (founded in 1941), as well as those bearing the brands of Life/Form®, Whirl-Pak®, Simulaids, Triarco, Spectrum Educational Supplies, Hubbard Scientific, Scott Resources, Haan Crafts, To-Sew, CPR Prompt®, Ginsberg Scientific and Summit Learning. Products include educational materials and supplies for substantially all K-12 curricula, molded plastics, biological materials, medical simulators, health care products and items for the agricultural, senior care and food industries. Aristotle has approximately 900 full-time employees at its operations in Fort Atkinson, WI, Modesto, CA, Fort Collins, CO, Plymouth, MN, Saugerties, NY, Chippewa Falls, WI, Otterbein, IN and Newmarket, Ontario, Canada.
There are 18.0 million shares outstanding of Aristotle common stock (NASDAQ: ARTL) and 1.1 million shares outstanding of Series I preferred stock (NASDAQ: ARTLP); there are also 11.0 million privately-held shares outstanding of Series J preferred stock. Aristotle has about 4,000 stockholders of record.
Further information about Aristotle can be obtained on its website, at aristotlecorp.net.
Safe Harbor under the Private Securities Litigation Reform Act of 1995
To the extent that any of the statements contained in this release are forward-looking, such statements are based on current expectations that involve a number of uncertainties and risks that could cause actual results to differ materially from those projected or suggested in such forward-looking statements. Aristotle cautions investors that there can be no assurance that actual results or business conditions will not differ materially from those projected or suggested in such forward-looking statements as a result of various factors, including, but not limited to, the following: (i) the ability of Aristotle to obtain financing and additional capital to fund its business strategy on acceptable terms, if at all; (ii) the ability of Aristotle on a timely basis to find, prudently negotiate and consummate additional acquisitions; (iii) the ability of Aristotle to manage any to-be acquired businesses; (iv) there is not an active trading market for the Companys securities and the stock prices thereof are highly volatile, due in part to the relatively small percentage of the Companys securities which is not held by the Companys majority stockholder and members of the Companys Board of Directors and management; (v) the ability of Aristotle to retain its Federal net operating tax loss carryforward position and other deferred tax positions; and (vi) other factors identified in Item 1A, Risk Factors, contained in the Companys Annual Report on Form 10-K for the year ended December 31, 2007. As a result, Aristotles future development efforts involve a high degree of risk. For further information, please see Aristotles filings with the Securities and Exchange Commission, including its Forms 10-K, 10-K/A, 10-Q and 8-K.
THE ARISTOTLE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
Three Months Ended
Six Months Ended
Cost of sales
Selling and administrative expense
Earnings from operations
Other (expense) income:
Earnings before income taxes
Income tax expense (benefit):
Net earnings applicable to common stockholders
Earnings per common share:
Weighted average common shares outstanding:
THE ARISTOTLE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
December 31, 2007
June 30, 2007
Cash and cash equivalents
Accounts receivable, net
Prepaid expenses and other
Deferred income taxes
Total current assets
Property, plant and equipment, net
Deferred income taxes
Liabilities and Stockholders' Equity
Current installments of long-term debt
Trade accounts payable
Accrued dividends payable
Total current liabilities
Long term debt, less current installments
Long term pension obligations
Other long term accruals
Preferred stock, Series I
Preferred stock, Series J
Additional paid-in capital
Accumulated other comprehensive earnings (loss)
Total stockholders' equity
Total liabilities and stockholders' equity