M & F Worldwide Corp. (MFW) filed Quarterly Report for the period ended 2009-09-30.
M & F Worldwide is the world's largest producer of licorice extract and the leading designer manufacturer and supplier of high precision camera systems for the movie and television industries. M & F Worldwide Corp. has a market cap of $425 million; its shares were traded at around $21.98 with a P/E ratio of 4.8 and P/S ratio of 0.2. M & F Worldwide Corp. had an annual average earning growth of 14.1% over the past 10 years.
Highlight of Business Operations:
Net revenues for the Harland Financial Solutions segment decreased by $4.9 million, or 6.7%, to $67.9 million in the 2009 period from $72.8 million in the 2008 period. Net revenues from the enterprise solutions product lines decreased $3.0 million in the 2009 period compared to the 2008 period. The decrease was primarily due to declines in license, hardware and professional services revenues. Additionally, there was a decrease in early termination fees in the 2009 period as compared to the 2008 period. Net revenues from the risk management product lines decreased $1.4 million in the 2009 period compared to the 2008 period. The decrease was primarily due to declines in lending products. The Company believes the declines were partially affected by the economic downturn, which has negatively affected information technology purchases by financial institutions.
Net revenues for the Licorice Products segment decreased by $3.3 million, or 11.7%, to $25.0 million in the 2009 period from $28.3 million in the 2008 period. Pure licorice derivative sales decreased by $0.6 million and sales of licorice extract to the worldwide tobacco industry decreased by $2.0 million, primarily as the result of a decline in shipment volumes to licorice derivative and tobacco customers. Sales of licorice extract to non-tobacco customers decreased by $0.7 million as a result of lower shipment volumes and the unfavorable impact of the U.S. dollar translation of Mafco Worldwide’s Euro denominated sales due to the stronger dollar in the 2009 period versus the 2008 period, which were not fully offset by price increases. The decline in shipment volumes for the 2009 period compared to the 2008 period for all of Mafco Worldwide’s products was primarily the result of order shipment timing, continued worldwide consumption declines in tobacco products using licorice and the continued rationalization of inventories by Altria, Inc. (“Altria”) and Philip Morris International, Inc. (“PMI”) subsequent to Altria’s spin-off of PMI in 2008.
During the 2009 period, the Company recorded restructuring costs of $3.4 million for the Harland Clarke segment and $0.9 million for the Harland Financial Solutions segment related to these plans. During the 2008 period, the Company recorded restructuring costs of $0.6 million for the Harland Clarke segment, $0.1 million for the Harland Financial Solutions segment and $0.7 million for the Scantron segment related to these plans.
Net revenues for the Harland Clarke segment decreased by $57.4 million, or 5.8%, to $926.4 million in the 2009 period from $983.8 million in the 2008 period. The decrease was primarily due to volume declines from check and related products, which the Company believes was partially affected by the economic downturn, as well as one less production day in the 2009 period. Declines in volumes were partially offset by increased revenues per unit. Additionally, there was $0.7 million of revenue for contract termination fees in the 2009 period compared to $2.3 million in the 2008 period.
Net revenues for the Harland Financial Solutions segment decreased by $11.1 million, or 5.1%, to $206.8 million in the 2009 period from $217.9 million in the 2008 period. Net revenues from the enterprise solutions product lines decreased $9.5 million in the 2009 period compared to the 2008 period. The decrease was primarily due to declines in license, hardware and professional services revenues. Additionally, there was a decrease in early termination fees in the 2009 period as compared to the 2008 period. Net revenues from the risk management product lines decreased $1.0 million in the 2009 period compared to the 2008 period. The decrease was primarily due to declines in mortgage products, partially offset by organic growth in lending products. The Company believes the declines were partially affected by the economic downturn, which has negatively affected information technology purchases by financial institutions.
Net revenues for the Licorice Products segment decreased by $7.1 million, or 8.5%, to $76.2 million in the 2009 period from $83.3 million in the 2008 period. Pure licorice derivative sales decreased by $1.3 million and sales of licorice extract to the worldwide tobacco industry decreased by $4.4 million, primarily as the result of a decline in shipment volumes to licorice derivative and tobacco customers. Sales of licorice extract to non-tobacco customers decreased by $1.4 million as a result of lower shipment volumes and the unfavorable impact of the U.S. dollar translation of Mafco Worldwide’s Euro denominated sales due to the stronger dollar in the 2009 period versus the 2008 period, which were not fully offset by price increases. The decline in shipment volumes for the 2009 period compared to the 2008 period for all of Mafco Worldwide’s products was primarily the result of order shipment timing, continued worldwide consumption declines in tobacco products using licorice and the continued rationalization of inventories by Altria and PMI subsequent to Altria’s spin-off of PMI in 2008.
MFW is in the portfolios of Michael Price of MFP Investors LLC, Jean-Marie Eveillard of Arnhold & S. Bleichroeder Advisers, LLC.
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