WD-40 Company 10-K Summary: Fiscal Year Ended August 31, 1995
Business Context and Reporting Period
This Form 10-K covers the fiscal year ended August 31, 1995 for WD-40 Company, a California corporation. The company manufactures and markets a single petroleum-based product, "WD-40," which serves as a lubricant, rust preventative, penetrant, and moisture displacer. The product is sold globally through retail chains, hardware stores, and industrial distributors. The company operates with a lean workforce of 148 employees across the U.S., Canada, the U.K., and Australia and relies on its trademark rather than patents for competitive advantage.
Key Financial Metrics
Revenue, Profit, Cash Flow, Margins, Debt, and Liquidity: The filing text does not provide specific numerical values for revenue, net income, operating margins, cash flow, debt levels, or liquidity ratios. These figures are incorporated by reference from the Annual Report to Shareholders (Pages 6-15) and are not present in the provided text.
Available Financial Data: The only specific financial data provided in the text relates to the "Reserve for bad debts and sales discounts" (Schedule II):
- Balance at beginning of 1995: $443,000
- Additions charged to costs/expenses: $984,000
- Deductions (write-offs): $951,000
- Balance at end of 1995: $476,000
Market Data: As of October 10, 1995, the aggregate market value of voting stock held by non-affiliates was $275,864,040. There were 7,703,155 shares of Common Stock outstanding.
Material Changes and Operational Context
The filing does not explicitly detail year-over-year percentage changes in financial performance due to the incorporation of financial statements by reference. However, it notes the following operational context:
- Competition: The company faces competition from at least 250 similar products, some priced lower than WD-40.
- Retail Dynamics: Ongoing consolidation in the marketplace has led major retailers to aggressively pursue additional trade allowances, which management notes could produce a long-term negative impact on sales and profits.
- Management Changes: Garry O. Ridge was elected Vice President-International in June 1995.
Guidance, Risks, and Contingencies
Risks and Contingencies:
- Trade Allowances: Increased demands from consolidated retailers for trade allowances pose a risk to future profitability.
- Market Share: The company cannot estimate the total market size or its specific market share proportion.
- Intellectual Property: The company holds no patents and relies entirely on its trademark and brand recognition.
- Foreign Operations: The company states there are no material risks attendant to its foreign operations.
- Legal Proceedings: There are no material legal proceedings pending.
Guidance and Outlook: The text does not contain specific forward-looking financial guidance or earnings projections. Management commentary is limited to the observation regarding retailer trade allowances and the sufficiency of current properties for several years.
Investor Verification Checklist
- Verify the specific revenue, net income, and cash flow figures in the Annual Report to Shareholders (incorporated by reference), as they are absent from this 10-K text.
- Review the Annual Report to Shareholders (Pages 11-12) for detailed breakdowns of foreign vs. domestic operations and export sales.
- Assess the impact of retailer trade allowances on gross margins by analyzing the trend in the "Reserve for bad debts and sales discounts" and any related expense line items in the full financial statements.
- Confirm the current status of the 250+ competing products and any shifts in market share relative to the company's inability to estimate total market size.
- Check the Proxy Statement (incorporated by reference) for details on executive compensation and director relationships.