<PAGE> 1
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 10-Q
(MARK ONE)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from
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COMMISSION FILE NUMBER 1-13960
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ITT CORPORATION
<TABLE>
<S> <C>
NEVADA 88-0340591
(STATE OF INCORPORATION) (I.R.S. EMPLOYER
IDENTIFICATION NUMBER)
</TABLE>
1330 AVENUE OF THE AMERICAS
NEW YORK, NY 10019-5490
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
TELEPHONE NUMBER: (212) 258-1000
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Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or such shorter period that the registrant
was required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days. Yes.'X'. No....
As of the close of business on May 9, 1996 there were outstanding 117.0
million shares of common stock, no par value, of the registrant.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
ITEM PAGE
------ ----
<C> <C> <S> <C>
PART FINANCIAL INFORMATION
I 1 Financial Statements
Consolidated Income -- Three Months Ended March 31, 1996 and 1995...... 2
Consolidated Balance Sheet -- March 31, 1996 and December 31, 1995..... 3
Consolidated Cash Flow -- Three Months Ended March 31, 1996 and 1995... 4
Notes to Financial Statements.......................................... 5
Business Segments...................................................... 6
2 Management's Discussion and Analysis of Financial Condition and
Results of Operations................................................ 7
PART OTHER INFORMATION
II 6 Exhibits and Reports on Form 8-K....................................... 9
Signature.............................................................. II-1
Exhibit Index.......................................................... II-2
</TABLE>
1
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The following unaudited financial statements, in the opinion of management,
reflect all adjustments (which include only normal recurring adjustments)
necessary for a fair presentation of the financial position, the results of
operations and cash flow for the periods presented. For a description of
accounting policies, see notes to financial statements in the Corporation's 1995
Annual Report on Form 10-K.
ITT CORPORATION AND SUBSIDIARIES
CONSOLIDATED INCOME
(IN MILLIONS EXCEPT PER SHARE)
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH 31,
-----------------
1996 1995*
------ ------
<S> <C> <C>
Revenues................................................................. $1,388 $1,261
Costs and expenses:
Salaries, benefits and other operating................................. 1,018 961
Selling, general and administrative.................................... 207 178
Depreciation and amortization.......................................... 63 56
------ ------
1,288 1,195
------ ------
100 66
Interest expense, net.................................................... (64) (67)
Miscellaneous (expense) income, net...................................... (2) 6
------ ------
34 5
Income tax expense....................................................... (15) (4)
Minority equity.......................................................... 1 6
------ ------
Net income............................................................... $ 20 $ 7
====== ======
Earnings per share (Pro Forma for 1995 -- See Notes to Financial
Statements)............................................................ $ .17 $ .06
====== ======
Weighted average common equivalent shares (Pro Forma for 1995 -- See
Notes to Financial Statements)......................................... 118.8 117.2
====== ======
</TABLE>
- ---------------
* 1995 first quarter revenues and other operating expenses include the
reclassification of pre-negotiated discounts in the Gaming Segment from other
operating expenses to revenues in order to conform to the current year
presentation.
The accompanying notes to financial statements are an integral part of the above
statement.
2
<PAGE> 4
ITT CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(IN MILLIONS EXCEPT FOR SHARES)
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1996 1995
--------- ------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents...................................... $ 184 $ 177
Receivables, net............................................... 635 784
Inventories.................................................... 98 86
Prepaid expenses and other..................................... 142 96
------ ------
Total current assets...................................... 1,059 1,143
Plant, property and equipment, net.................................. 4,011 3,979
Investments......................................................... 1,745 1,757
Goodwill, net....................................................... 1,318 1,332
Long-term receivables, net.......................................... 144 150
Other assets........................................................ 321 331
------ ------
$ 8,598 $8,692
====== ======
LIABILITIES AND STOCKHOLDERS EQUITY
Current liabilities:
Accounts payable............................................... $ 263 $ 309
Accrued expenses............................................... 665 695
Notes payable and current maturities of long-term debt......... 252 265
Other current liabilities...................................... 129 161
------ ------
Total current liabilities................................. 1,309 1,430
Long-term debt...................................................... 3,572 3,575
Deferred income taxes............................................... 148 141
Other liabilities................................................... 339 350
Minority interest................................................... 271 260
------ ------
5,639 5,756
------ ------
Stockholders Equity:
Common stock: authorized 200,000,000 shares, no par or stated
value, outstanding 117,171,812 and 117,196,370 shares,
respectively.................................................. 2,939 2,944
Cumulative translation adjustment.............................. 8 --
Retained earnings/(accumulated deficit)........................ 12 (8)
------ ------
Total stockholders equity................................. 2,959 2,936
------ ------
$ 8,598 $8,692
====== ======
</TABLE>
The accompanying notes to financial statements are an integral part of the above
statement.
3
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ITT CORPORATION AND SUBSIDIARIES
CONSOLIDATED CASH FLOW
(IN MILLIONS)
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
MARCH 31,
----------------
1996 1995
---- -------
<S> <C> <C>
OPERATING ACTIVITIES
Net Income................................................................ $ 20 $ 7
Adjustments to net income:
Depreciation and amortization........................................... 63 56
Provision for doubtful receivables...................................... 9 14
Equity income, net of dividends received................................ -- 1
Changes in working capital:
Accounts receivable..................................................... 139 35
Inventories............................................................. (12) (12)
Accounts payable........................................................ (46) (20)
Accrued expenses........................................................ (24) (5)
Accrued and deferred taxes................................................ (35) (21)
Other, net................................................................ (15) 27
---- -------
Cash from operating activities....................................... 99 82
---- -------
INVESTING ACTIVITIES
Additions to plant, property and equipment................................ (86) (114)
Proceeds from divestments................................................. 21 --
Acquisitions, net of acquired cash........................................ -- (2,155)
Other, net................................................................ (7) (2)
---- -------
Cash used for investing activities................................... (72) (2,271)
---- -------
FINANCING ACTIVITIES
Short-term debt, net...................................................... (12) 28
Long-term debt issued..................................................... 42 41
Long-term debt repaid..................................................... (58) (103)
Change in investments and advances from ITT Industries, Inc.*............. -- 2,248
Other, net................................................................ 8 15
---- -------
Cash (used for)/from financing activities............................ (20) 2,229
---- -------
EXCHANGE RATE EFFECT ON CASH AND CASH EQUIVALENTS......................... -- 13
---- -------
Increase in cash and cash equivalents..................................... 7 53
Cash and Cash Equivalents -- Beginning of Period.......................... 177 191
---- -------
CASH AND CASH EQUIVALENTS -- END OF PERIOD................................ $184 $ 244
==== =======
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest.................................................................. $ 39 $ 73
==== =======
Income taxes.............................................................. $ 35 $ 6
==== =======
</TABLE>
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* Investments and advances from ITT Industries, Inc. represents the means by
which ITT was funded by ITT Corporation, a Delaware corporation (which has
been renamed ITT Industries, Inc. and reincorporated in Indiana; "Old ITT"),
prior to the distribution on December 19, 1995 of the outstanding shares of
common stock of ITT to shareholders of Old ITT on that date and consisted of
both equity and interest bearing advances.
The accompanying notes to financial statements are an integral part of the above
statement.
4
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NOTES TO FINANCIAL STATEMENTS
(DOLLARS IN MILLIONS EXCEPT PER SHARE)
1) BASIS OF PRESENTATION
ITT Corporation ("ITT" or the "Corporation") is the world's largest hotel
and gaming company. ITT's principal lines of business are hotels, gaming and
information services. The hotels segment is comprised of a worldwide hospitality
network of over 400 full-service hotels serving three markets: luxury, upscale
and mid-price. ITT's hotel operations are represented in nearly every major
world market. ITT's gaming operations are located in several key domestic
jurisdictions. ITT also operates various hotel/casino ventures outside the
United States. ITT's information services segment publishes telephone
directories in many countries outside the United States and provides
post-secondary career education in the United States.
On December 19, 1995 (the "Distribution Date"), ITT Corporation, a Delaware
corporation ("Old ITT", which has been reincorporated in Indiana and renamed ITT
Industries, Inc.), distributed to its shareholders of record at the close of
business on such date all of the outstanding shares of common stock of ITT, then
a wholly owned subsidiary of Old ITT (the "Distribution"). In such Distribution,
holders of common stock of Old ITT received one share of ITT common stock for
every one share of Old ITT common stock held. In connection with the
Distribution, ITT, which was then named "ITT Destinations, Inc.", changed its
name to ITT Corporation.
2) GAMING OPERATIONS
Casino revenues represent the net win from gaming wins and losses. Revenues
exclude the retail value of rooms, food, beverage, entertainment and other
promotional allowances provided on a complimentary basis to customers. The
estimated retail value of the promotional allowances was $42 and $24 for the
three months ended March 31, 1996 and 1995, respectively. The estimated cost of
such promotional allowances was $28 and $18 for the three months ended March 31,
1996 and 1995, respectively, and have been included in costs and expenses.
Revenues and costs and expenses of the Gaming operations are comprised of
the following:
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31,
-------------------------------------------------
1996 1995
---------------------- ----------------------
COSTS AND COSTS AND
REVENUES EXPENSES REVENUES EXPENSES
-------- --------- -------- ---------
<S> <C> <C> <C> <C>
Gaming................................. $262 $ 147 $179 $ 96
Rooms.................................. 18 6 15 4
Food and beverage...................... 20 20 15 15
Other operations....................... 24 13 15 10
Selling, general and administrative.... -- 57 -- 40
Depreciation and amortization.......... -- 21 -- 18
Provision for doubtful accounts........ -- 7 -- 14
---- ---- ---- ----
Total........................ $324 $ 271 $224 $ 197
==== ==== ==== ====
</TABLE>
3) ACQUISITIONS
On January 30, 1995, the Corporation acquired Caesars World, Inc.
("Caesars") for approximately $1.76 billion and on March 10, 1995, the
Corporation acquired a 50% interest in the businesses which comprise Madison
Square Garden ("MSG") for approximately $.6 billion.
The following pro forma summary for the three months ended March 31, 1995
presents information as if the acquisitions of Caesars and MSG had occurred as
of January 1, 1995:
<TABLE>
<S> <C>
Net revenues........................................................ $1,343
Net loss............................................................ $ (8)
======
Loss per share...................................................... $ (.07)
======
</TABLE>
5
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NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(DOLLARS IN MILLIONS EXCEPT PER SHARE)
The pro forma information is not necessarily indicative of the results that
would have occurred had such acquisitions taken place on January 1, 1995.
4) EARNINGS PER SHARE
Earnings per share in the 1995 first quarter and through the Distribution
Date were computed based upon the number of ITT common shares that were
outstanding on the Distribution Date.
5) RECEIVABLES
Current receivables of $635 and $784 at March 31, 1996 and December 31,
1995, including current maturities of notes receivable, are reported net of
allowances for doubtful accounts of $133 and $106.
Long-term receivables of $144 and $150 at March 31, 1996 and December 31,
1995, are net of allowances for doubtful accounts of $91 and $98, exclude
current maturities of $36 and $21 and approximate fair value.
6) PLANT, PROPERTY AND EQUIPMENT
Plant, property and equipment consists of the following:
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1996 1995
--------- ------------
<S> <C> <C>
Land and improvements........................................... $ 1,180 $1,178
Buildings and improvements...................................... 2,341 2,311
Machinery, furniture, fixtures and equipment.................... 783 789
Construction work in progress................................... 282 250
Other........................................................... 95 97
------ ------
4,681 4,625
Less -- accumulated depreciation and amortization............... (670) (646)
------ ------
$ 4,011 $3,979
====== ======
</TABLE>
BUSINESS SEGMENT INFORMATION
(IN MILLIONS)
Business segment information is as follows:
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31,
------------------------------------
1996 1995* 1996 1995*
------ ------ ---- -----
REVENUES INCOME
----------------- --------------
<S> <C> <C> <C> <C>
Hotels.................................................. $ 966 $ 945 $ 56 $ 31
Gaming.................................................. 324 224 53 27
Information Services.................................... 98 92 13 10
------ ------ ---- ----
Total Segments.......................................... 1,388 1,261 122 68
Other................................................... -- -- (22) (2)
------ ------ ---- ----
1,388 1,261 100 66
Interest expense, net................................... (64) (67)
Miscellaneous (expense) income, net..................... (2) 6
Income tax expense...................................... (15) (4)
Minority equity......................................... 1 6
------ ------ ---- ----
$1,388 $1,261 $ 20 $ 7
====== ====== ==== ====
</TABLE>
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* 1995 first quarter revenues and other operating expenses include the
reclassification of pre-negotiated discounts in the Gaming Segment from other
operating expenses to revenues in order to conform to the current year
presentation.
6
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
DOLLARS IN MILLIONS UNLESS OTHERWISE STATED
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 1996 COMPARED WITH THREE MONTHS ENDED MARCH 31,
1995
Revenues of $1,388 in the 1996 first quarter increased 10% compared with
$1,261 in 1995, reflecting higher average room rates in owned and leased
properties and the impact of the January 30, 1995 acquisition of Caesars.
Revenues at ITT World Directories, Inc. ("ITT World Directories") were basically
unchanged due to a historically limited publishing schedule in the first
quarter, while ITT Educational Services, Inc. ("ITT Educational Services")
revenues increased 12% due to tuition price increases and increased census.
Excluding the Caesars acquisition, revenues increased 3%.
Salaries, benefits and other operating costs increased 6% in the quarter to
$1,018 from $961 representing the full impact of the Caesars acquisition and
smaller increases in the cost of services. Overall, salaries, benefits and other
operating costs represented 73% of revenues in 1996, down from 76% in the 1995
quarter. This decrease reflects management's ongoing cost containment programs
as well as significant increases in average room rates at the Corporation's
owned and leased hotels outpacing the increase in costs.
Selling, general and administrative expenses increased 16% to $207 in the
1996 first quarter compared with $178 in the 1995 quarter. This increase was
primarily due to the inclusion of expenses at Caesars for the full three months
and the fact that the 1995 first quarter included a benefit of $26, which
represented the reimbursement of overhead expenses related to world headquarters
by the entities that comprised Old ITT prior to the Distribution ("service fee
income"). Excluding the impact of the service fee income and the Caesars costs,
selling, general and administrative expenses declined 5% from the prior period,
reflecting management's continuing commitment to cost containment.
The Corporation's EBITDA increased 34% and operating income rose 52% in the
quarter. These increases reflect the contribution of the Caesars acquisition, as
well as the impact of higher average room rates, particularly in owned
properties in North America. Depreciation and amortization increased 13%
compared with the prior period due primarily to the Caesars acquisition.
Net interest expense decreased slightly in the 1996 first quarter. However,
during 1995, Old ITT allocated certain indebtedness between ITT and ITT
Industries, Inc. in anticipation of the Distribution. As a result of such
allocation, the interest expense reflected in the 1995 first quarter is not
necessarily indicative of the interest expense that ITT would have incurred if
ITT was an independent entity during such period.
Income tax expense increased in 1996 on higher pretax earnings. The
minority equity benefit includes the net loss attributable to the minority
shareholders of Ciga S.p.A. (this loss is due to the seasonality of its
business) which was partially offset by the net income attributable to the
minority shareholders of ITT World Directories and ITT Educational Services.
Cash from operating activities, as defined by Statement of Accounting
Standards No. 95 ("SFAS 95"), increased to $99 in the first quarter of 1996 from
$82 in the 1995 quarter reflecting improved operating results and the accretive
impact of the Caesars acquisition. The SFAS definition of cash from operating
activities differs from EBITDA largely due to the inclusion of interest, income
taxes and changes in working capital.
7
<PAGE> 9
BUSINESS SEGMENTS
Revenues, EBITDA and operating income (excluding the effect of overhead and
minority equity) for each of ITT's three major business segments were as
follows:
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31, 1996 THREE MONTHS ENDED MARCH 31, 1995
- --------------------------------- ---------------------------------
OPERATING OPERATING
REVENUES EBITDA INCOME REVENUES EBITDA INCOME
- -------- ------ --------- -------- ------ ---------
<C> <C> <C> <S> <C> <C> <C>
$966 $ 90 $56 .............Hotels............. $945 $ 62 $31
</TABLE>
Hotels 1996 first quarter results reflect a significant increase in revenue
per available room (i.e., occupancy percentage times average daily rate) in the
Corporation's owned and leased properties from $89 in 1995 to $96 in 1996, an 8%
increase. This increase was the primary contributor to an overall 13% revenue
increase in these properties from the 1995 quarter. Operating improvements in
the owned and leased properties have a greater impact on the Hotels segment
results than do improvements in managed properties, where the majority of the
improvements are realized by those property owners. Managed property revenues
decreased 2% from the prior period due to the termination of several hotel
management contracts. EBITDA and operating income growth were generated
primarily in the major geographic areas in which the Corporation has invested
most heavily, most notably North America. Management continues to aggressively
pursue profitable expansion opportunities while optimizing cost saving
initiatives in each of its market segments.
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31, 1996 THREE MONTHS ENDED MARCH 31, 1995
- --------------------------------- ---------------------------------
OPERATING OPERATING
REVENUES EBITDA INCOME REVENUES EBITDA INCOME
- -------- ------ --------- -------- ------ ---------
<C> <C> <C> <S> <C> <C> <C>
$324 $ 74 $53 .............Gaming............. $224 $ 45 $27
</TABLE>
The Gaming results reflect the impact of the January 30, 1995 acquisition
of Caesars as well as the opening of additional casinos in Halifax and Sydney,
Nova Scotia, during the second and third quarters of 1995, respectively. Caesars
experienced its best first quarter ever as all three of its properties recorded
results which were significantly higher than the 1995 quarter. The improved
results at these properties were due primarily to increased slot play, reduced
costs and operating efficiencies. Significant contributors to the cost
reductions were the consolidation of certain support functions at the
Corporation's Las Vegas properties and the closing of Caesars' Los Angeles
headquarters in June, 1995. The Gaming results were adversely effected by
abnormally low hold percentages at the Sheraton Desert Inn.
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31, 1996 THREE MONTHS ENDED MARCH 31, 1995
- --------------------------------- ---------------------------------
OPERATING OPERATING
REVENUES EBITDA INCOME REVENUES EBITDA INCOME
- -------- ------ --------- -------- ------ ---------
<C> <C> <C> <S> <C> <C> <C>
$ 98 $ 20 $13 .......Information Services....... $ 92 $ 17 $10
</TABLE>
Revenues at ITT World Directories were basically unchanged due to a
historically limited publishing schedule in the first quarter, while EBITDA and
operating income continued to improve due mainly to continuing cost controls
throughout the organization.
ITT Educational Services' revenues increased 12% due to tuition price
increases and increased census, including a 28% increase in new student
enrollments from the 1995 first quarter, which more than offset the cost of
newly opened schools and increased marketing efforts.
LIQUIDITY AND CAPITAL RESOURCES
The Corporation's EBITDA increased 34% in the quarter reflecting strong
earnings growth in all business segments as well as the continuing benefits of
management's cost rationalization strategies and the accretive impact of the
Caesars acquisition. These cash flows are expected to be sufficient to service
indebtedness, satisfy tax obligations and cover maintenance capital expenditures
and other liquidity needs. Additional liquidity needs would be funded through
traditional debt or equity financing, asset sales or any combination thereof. On
May 2, 1996, the Corporation sold 2.1 million shares, or about 22%, of its
holdings in Alcatel Alsthom for approximately $200. Proceeds from this sale will
be used for general corporate purposes, including debt reduction. After giving
effect to this sale, the Corporation owns approximately 7.3 million, or
approximately 4.8%, of the outstanding capital shares of Alcatel Alsthom.
8
<PAGE> 10
Capital expenditures totaled $86 in the 1996 first quarter, 61% and 36% at
the Hotels and Gaming segments, respectively, compared with $114 in the 1995
first quarter, with 87% and 11% attributable to the Hotels and Gaming segments,
respectively. In addition, during the 1995 first quarter, the Corporation
completed the acquisitions of Caesars ($1.76 billion) and a 50% interest in
businesses which comprise Madison Square Garden ($.6 billion).
External borrowings were $3.8 billion at March 31, 1996 and December 31,
1995 as 1996 first quarter capital expenditures were offset by funds generated
from operations. Cash and cash equivalents were $184 at March 31, 1996 compared
with $177 at December 31, 1995. The Corporation expects to pay $103.5 in
connection with its proposed acquisition of WNYC-TV in partnership with Dow
Jones & Company. This transaction is expected to close in the second or third
quarter of 1996 and will be funded through existing debt facilities.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) See the Exhibit Index for a list of exhibits filed herewith.
(b) There were no reports on Form 8-K filed by the Corporation during the
quarter for which this report is filed.
9
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SIGNATURE
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 THEREUNTO DULY AUTHORIZED.
ITT CORPORATION
By /s/ J. F. DANSKI
---------------------------------------
J. F. DANSKI
SENIOR VICE PRESIDENT AND CONTROLLER
(CHIEF ACCOUNTING OFFICER)
May 14, 1996
II-1
<PAGE> 12
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION LOCATION
<C> <S> <C>
3.1 Restated Articles of Incorporation....... Incorporated by reference to Exhibit 3.1
to the Registrant's Amendment No. 1 to
Form 10/A dated November 13, 1995 (File
No. 1-13960).
3.2 Certificate of Amendment of Articles of
Incorporation.......................... Incorporated by reference to Exhibit No.
1 to the Registrant's Current Report on
Form 8-K dated December 22, 1995 (File
No. 1-13960).
3.3 By-Laws.................................. Incorporated by reference to Exhibit 3.2
to the Registrant's Amendment No. 1 to
Form 10/A dated November 13, 1995 (File
No. 1-13960).
4.1 Specimen common share certificate........ Incorporated by reference to Exhibit 4.1
to the Registrant's Amendment No. 1 to
Form 10/A dated November 13, 1995 (File
No. 1-13960).
4.2 Rights Agreement dated as of November 1,
1995 between the Registrant and The
Bank of New York....................... Incorporated by reference to Exhibit 4.4
to the Registrant's Amendment No. 1 to
Form 10/A dated November 13, 1995 (File
No. 1-13960).
4.3 Form of Certificate of Voting Powers,
Preferences and Relative Participating,
Optional and Other Special Rights and
Qualifications, Limitations or
Restrictions of Series A Participating
Cumulative Preferred Stock............. Incorporated by reference to Exhibit 4.4
(attached as Exhibit A thereto) to the
Registrant's Amendment No. 1 to Form
10/A dated November 13, 1995 (File No.
1-13960).
4.4 Form of Right Certificate................ Incorporated by reference to Exhibit 4.4
(attached as Exhibit B thereto) to the
Registrant's Amendment No. 1 to Form
10/A dated November 13, 1995 (File No.
1-13960).
4.5 Other instruments defining rights of
security holders, including
indentures............................. The Registrant hereby agrees to file with
the Commission a copy of any instrument
defining the rights of long-term debt
holders of the Registrant and its
consolidated subsidiaries upon request
of the Commission.
10.1 Distribution Agreement among ITT
Industries, Inc., the Registrant and
ITT Hartford Group, Inc. .............. Incorporated by reference to Exhibit 10.1
to the Registrant's Annual Report on Form
10-K for the year ended December 31,
1995 (File No. 1-13960).
10.2 Intellectual Property License Agreement
between and among ITT Industries, Inc.,
the Registrant and ITT Hartford Group,
Inc. .................................. Incorporated by reference to Exhibit 10.2
to the Registrant's Annual Report on Form
10-K for the year ended December 31,
1995 (File No. 1-13960).
</TABLE>
II-2
<PAGE> 13
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION LOCATION
<C> <S> <C>
10.3 Trademark Assignment Agreement between
ITT Industries, Inc. and the
Registrant ............................ Incorporated by reference to Exhibit 10.3
to the Registrant's Annual Report on Form
10-K for the year ended December 31,
1995 (File No. 1-13960).
10.4 License Assignment Agreement between ITT
Industries, Inc. and the Registrant ... Incorporated by reference to Exhibit 10.4
to the Registrant's Annual Report on Form
10-K for the year ended December 31,
1995 (File No. 1-13960).
10.5 License Assignment Agreement among the
Registrant, ITT Hartford Group, Inc.
and Nutmeg Insurance Company........... Incorporated by reference to Exhibit 10.5
to the Registrant's Annual Report on Form
10-K for the year ended December 31,
1995 (File No. 1-13960).
10.6 License Assignment Agreement among the
Registrant, Nutmeg Insurance Company
and Hartford Fire Insurance Company.... Incorporated by reference to Exhibit 10.6
to the Registrant's Annual Report on Form
10-K for the year ended December 31,
1995 (File No. 1-13960).
10.7 Tax Allocation Agreement among ITT
Industries, Inc., the Registrant and
ITT Hartford Group, Inc. .............. Incorporated by reference to Exhibit 10.7
to the Registrant's Annual Report on Form
10-K for the year ended December 31,
1995 (File No. 1-13960).
10.8 Employee Benefit Services and Liability
Agreement among ITT Industries, Inc.,
the Registrant and ITT Hartford Group,
Inc. .................................. Incorporated by reference to Exhibit 10.8
to the Registrant's Annual Report on Form
10-K for the year ended December 31,
1995 (File No. 1-13960).
10.9 Form of ITT Corporation 1996 Restricted
Stock Plan for Non-Employee
Directors.............................. Incorporated by reference to Exhibit 10.9
to the Registrant's Amendment No. 1 to
Form 10/A dated November 13, 1995 (File
No. 1-13960).
10.10 Form of indemnification agreement with
members of the Board of Directors...... Incorporated by reference to Exhibit
10.10 to the Registrant's Form 10 dated
September 18, 1995 (File No. 1-13960).
10.11 Form of 1995 ITT Corporation Incentive
Stock Plan............................. Incorporated by reference to Exhibit
10.11 to the Registrant's Form 10 dated
September 18, 1995 (File No. 1-13960).
10.12 Form of ITT Corporation Senior Executive
Severance Pay Plan..................... Incorporated by reference to Exhibit
10.12 to the Registrant's Form 10 dated
September 18, 1995 (File No. 1-13960).
10.13 Form of R.V. Araskog employment
agreement.............................. Incorporated by reference to Exhibit
10.13 to the Registrant's Form 10 dated
September 18, 1995 (File No. 1-13960).
</TABLE>
II-3
<PAGE> 14
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION LOCATION
<C> <S> <C>
10.14 364-Day Competitive Advance and Revolving
Credit Facility Agreement dated as of
November 10, 1995 among the Registrant,
the lenders parties thereto and
Chemical Bank, as administrative
agent.................................. Incorporated by reference to Exhibit
10.14 to the Registrant's Annual Report
on Form 10-K for the year ended
December 31, 1995 (File No. 1-13960).
10.15 Five-Year Competitive Advance and
Revolving Credit Facility Agreement
dated as of November 10, 1995 among the
Registrant, the lenders parties thereto
and Chemical Bank, as issuing bank and
administrative agent................... Incorporated by reference to Exhibit
10.15 to the Registrant's Annual Report
on Form 10-K for the year ended
December 31, 1995 (File No. 1-13960).
11 Statement re computation of per share
earnings............................... None.
12 Statement re computation of ratios....... Filed herewith.
15 Letter re unaudited interim financial in-
formation.............................. None.
18 Letter re change in accounting
principles............................. None.
19 Report furnished to security holders..... None.
22 Published report regarding matters
submitted to vote of security
holders................................ None.
23 Consents of experts and counsel.......... None.
24 Power of attorney........................ None.
27 Financial data schedule.................. Filed herewith.
99 Additional exhibits...................... None.
</TABLE>
II-4
<PAGE> 1
EXHIBIT 12
ITT CORPORATION AND SUBSIDIARIES
CALCULATION OF RATIO OF EARNINGS TO TOTAL FIXED CHARGES
(MILLIONS OF DOLLARS)
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH 31,
---------------
1996 1995
---- ----
<S> <C> <C>
Earnings:
Net Income................................................................. $ 20 $ 7
Add:
Adjustment for distributions in excess of equity earnings and
losses(a)............................................................. -- 1
Income taxes............................................................. 15 4
Minority equity in net loss.............................................. (1) (6)
Amortization of interest capitalized..................................... 1 1
---- ----
35 7
---- ----
Fixed Charges:
Interest and other financial charges..................................... 83 72
Interest factor attributable to rentals.................................. 7 6
---- ----
90 78
---- ----
Earnings, as adjusted...................................................... $125 $ 85
==== ====
Fixed Charges:
Fixed charges above...................................................... $ 90 $ 78
Interest capitalized..................................................... 1 1
---- ----
Total fixed charges...................................................... $ 91 $ 79
==== ====
Ratios:
Earnings, as adjusted, to total fixed charges............................ 1.37 1.08
==== ====
</TABLE>
- ---------------
Note:
a) The adjustment for distributions in excess of equity earnings and losses
represents the adjustment to income for distributions in excess of
undistributed earnings and losses of companies in which at least 20% but less
than 50% equity is owned.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the March
31, 1996 Financial Statements included in Form 10-Q and is qualified in its
entirety by reference to such Financial Statements.
</LEGEND>
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 184
<SECURITIES> 0
<RECEIVABLES> 768
<ALLOWANCES> 133
<INVENTORY> 98
<CURRENT-ASSETS> 1,059
<PP&E> 4,681
<DEPRECIATION> 670
<TOTAL-ASSETS> 8,598
<CURRENT-LIABILITIES> 1,309
<BONDS> 3,824
0
0
<COMMON> 2,939
<OTHER-SE> 20
<TOTAL-LIABILITY-AND-EQUITY> 8,598
<SALES> 1,388
<TOTAL-REVENUES> 1,388
<CGS> 1,288
<TOTAL-COSTS> 1,288
<OTHER-EXPENSES> 2
<LOSS-PROVISION> 9
<INTEREST-EXPENSE> 9
<INCOME-PRETAX> 34
<INCOME-TAX> 15
<INCOME-CONTINUING> 20
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 20
<EPS-PRIMARY> .17
<EPS-DILUTED> .17
</TABLE>
