SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
(MARK ONE)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended December 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _________ to __________
Commission File # 1-4252
UIC 401(K) RETIREMENT SAVINGS PLAN
(Full title of the plan)
UNITED INDUSTRIAL CORPORATION
(Name of the issuer of the securities held pursuant to the plan)
United Industrial Corporation
570 Lexington Avenue
New York, New York 10022
(Address of principal executive office)
<PAGE>
REQUIRED INFORMATION
Item 4.
- -------
The financial statements and schedules of the UIC 401(k) Retirement
Savings Plan for the year ended December 31, 1998 (attached).
Exhibits
- -------
23.1 Consent of Ernst & Young LLP.
2
<PAGE>
AUDITED FINANCIAL STATEMENTS
AND SUPPLEMENTAL SCHEDULES
UIC 401(K) RETIREMENT
SAVINGS PLAN
Years ended December 31, 1998 and 1997
with Report of Independent Auditors
<PAGE>
UIC 401(k) Retirement Savings Plan
Audited Financial Statements and Supplemental Schedules
Years ended December 31, 1998 and 1997
CONTENTS
Report of Independent Auditors...........................................1
Audited Financial Statements
Statements of Net Assets Available forBenefits...........................2
Statements of Changes in Net Assets Available forBenefits................3
Notes to Financial Statements............................................4
Supplemental Schedules
Line27a--Schedule of AssetsHeld for Investment Purposes.................12
Line27d--Schedule of Reportable Transactions............................13
<PAGE>
Report of Independent Auditors
Administrative Committee
UIC 401(k) Retirement Savings Plan
We have audited the accompanying statements of net assets available for benefits
of the UIC 401(k) Retirement Savings Plan as of December 31, 1998 and 1997, and
the related statements of changes in net assets available for benefits for the
years then ended. These financial statements are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan at
December 31, 1998 and 1997, and the changes in its net assets available for
benefits for the years then ended, in conformity with generally accepted
accounting principles.
Our audits were performed for the purpose of forming an opinion on the financial
statements taken as a whole. The accompanying supplemental schedules of assets
held for investment purposes as of December 31, 1998, and reportable
transactions for the year then ended, are presented for the purpose of
additional analysis and are not a required part of the financial statements but
are supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. These supplemental schedules are the responsibility of the
Plan's management. The supplemental schedules have been subjected to the
auditing procedures applied in our audits of the financial statements and, in
our opinion, are fairly stated in all material respects in relation to the
financial statements taken as a whole.
/s/ Ernst & Young LLP
Baltimore Maryland
May 28, 1999
<PAGE>
UIC 401(k) Retirement Savings Plan
Statements of Net Assets Available for Benefits
<TABLE>
<CAPTION>
DECEMBER 31
1998 1997
------------------------------------
<S> <C> <C>
ASSETS
Investments, stated at fair value:
Cash $ 14,308 $ 18,894
Fidelity Magellan Fund 38,403,907 29,569,273
Fidelity Managed Income Portfolio 18,921,786 18,245,430
Fidelity Retirement Government Money Market Fund 2,264,569 1,776,549
Fidelity Growth & Income Fund 18,374,335 14,254,151
Fidelity Contrafund 10,069,014 8,190,740
Fidelity Investment Grade Bond Fund 1,488,388 754,347
United Industrial Corporation Common Stock 721,297 801,651
Templeton Foreign A Fund 311,828 -
Invesco Total Return Fund 434,338 -
Fidelity Low Priced Stock Fund 607,929 -
Spartan US Equity Index Fund 1,235,645 -
Participant loans 2,037,716 1,707,539
------------------------------------
Total investments 94,885,060 75,318,574
------------------------------------
Net assets available for benefits $ 94,885,060 $ 75,318,574
====================================
</TABLE>
See accompanying notes.
2
<PAGE>
UIC 401(k) Retirement Savings Plan
Statements of Changes in Net Assets Available for Benefits
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
1998 1997
------------------------------------
<S> <C> <C>
ADDITIONS
Employee contributions $ 5,354,917 $ 5,138,123
Employer contributions 1,878,406 1,491,546
Rollover contributions 312,671 135,149
Investment income:
Fidelity Magellan Fund 1,785,532 1,931,746
Fidelity Managed Income Portfolio 1,044,674 1,089,631
Fidelity Retirement Government Money Market Fund 98,619 83,322
Fidelity Growth & Income Fund 987,918 653,678
Fidelity Contrafund 741,751 767,190
Fidelity Investment Grade Bond Fund 73,397 39,013
United Industrial Corporation Stock Fund 31,745 20,466
Templeton Foreign A Fund 30,540 -
Invesco Total Return Fund 18,795 -
Fidelity Low Priced Stock Fund 49,758 -
Spartan US Equity Index Fund 14,655 -
Interest on loans to participants 181,391 159,329
------------------------------------
Total investment income 5,058,775 4,744,375
------------------------------------
12,604,769 11,509,193
DEDUCTIONS
Withdrawals (5,649,872) (6,606,396)
Net realized and unrealized appreciation in aggregate fair value
of investments 12,611,589 8,028,130
------------------------------------
Net increase 19,566,486 12,930,927
Net assets available for benefits at beginning of year 75,318,574 62,387,647
------------------------------------
Net assets available for benefits at end of year $ 94,885,060 $ 75,318,574
====================================
</TABLE>
See accompanying notes.
3
<PAGE>
UIC 401(k) Retirement Savings Plan
Notes to Financial Statements
December 31, 1998
1. SIGNIFICANT ACCOUNTING POLICIES
Investments in mutual funds are reported at current redemption value. The United
Industrial Corporation Common Stock is reported at fair value, based on
published market prices. Participant loans represent the outstanding principal
balances of the loans and are valued at cost, which approximates fair value.
The change in the difference between cost and fair value is reflected in the
statements of changes in net assets available for benefits as net unrealized
appreciation (depreciation) in the aggregate fair value of investments. The
realized gain or loss on investments is the difference between the proceeds and
the specific cost of the investments.
Rollover contributions represent transfers from other qualified retirement
plans.
Administrative expenses associated with the UIC 401(k) Retirement Savings Plan
(the "Plan"), including the amount paid to Fidelity Management Trust Co. for
acting as custodian of the investments of the Plan, were paid by United
Industrial Corporation (the "Company") in 1998 and 1997.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates that affect amounts
reported in the financial statements and accompanying notes. Actual results
could differ from those estimates.
Certain prior year amounts have been reclassified to conform to current year
presentation.
2. DESCRIPTION OF THE PLAN
The Plan is a defined contribution plan. The purpose of the Plan is to encourage
employees to save regularly and to provide additional funds upon retirement.
Contributions are made by employees through payroll deductions and submitted to
Fidelity Management Trust Company Cash Reserve Fund, then subsequently deposited
in the investment option account(s) selected by the employee. The Company
matches employees' contributions in an amount equal to the lesser of 50% of
salary deferrals or 4% of Compensation, as defined in the Plan Document.
Effective January 1, 1998, the Plan was amended to repeal the profit sharing
provision of employer contributions.
4
<PAGE>
UIC 401(k) Retirement Savings Plan
Notes to Financial Statements (continued)
2. DESCRIPTION OF THE PLAN (CONTINUED)
Employer contributions on the statement of changes in net assets available for
benefits for the year ended December 31, 1998 include approximately $350,000 of
profit sharing contributions related to 1997. Employer contributions are vested
after five years of service. The Company is the named fiduciary which controls
and manages the operations of the Plan and acts as Administrator.
All employees aged 21 or more who have completed one year of continuous
employment, consisting of at least 1,000 hours, with the Company (including its
participating subsidiaries) are eligible to participate in the Plan.
Participating employees contribute to the Plan through payroll deductions in
amounts ranging from 2% to 15% of their earnings up to the annual IRS limit.
Contributions to the Plan are invested in the available investment options in
accordance with the participants' elections. All employee contributions to the
Plan are immediately vested.
The Company has the right to terminate the Plan at any time. In the event of a
termination, the participants accounts shall be distributed to them in cash or
in property or in any combination of cash and property.
Additional information about the Plan and the vesting and benefit provisions is
contained in the Summary Plan Description of the UIC 401(k) Retirement Savings
Plan. Copies are available from the Human Resources Department of the Company.
3. INCOME TAX STATUS
The Plan has received a determination letter from the Internal Revenue Service
dated January 16, 1996, stating that the Plan is qualified under Section 401(a)
of the Internal Revenue Code (the "Code") and, therefore, the related trust is
exempt from taxation. Once qualified, the Plan is required to operate in
conformity with the Code to maintain its qualification. The Plan Administrator
believes the Plan is being operated in compliance with the applicable
requirements of the Code and, therefore, believes that the Plan is qualified and
the related trust is tax exempt.
4. RECONCILIATION TO FORM 5500
Total Plan earnings on investments, as reported on Form 5500 lines 32 b (1)
through (10), has been reported as Net realized and unrealized appreciation in
aggregate fair value of investments and as investment income in the accompanying
financial statements.
5
<PAGE>
UIC 401(k) Retirement Savings Plan
Notes to Financial Statements (continued)
5. STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
<TABLE>
<CAPTION>
DECEMBER 31, 1998
FIDELITY
FIDELITY RETIREMENT FIDELITY
FIDELITY MANAGED GOVERNMENT FIDELITY INVESTMENT UIC
MAGELLAN INCOME MONEY MARKET GROWTH & FIDELITY GRADE BOND FUNDCOMMON STOCK
FUND PORTFOLIO FUND INCOME FUND CONTRAFUND FUND LOAN FUND
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Investments at
fair value:
Cash $ - $ - $ - $ - $ - $ - $ 14,308 $ -
Mutual Funds 38,403,907 18,921,786 2,264,569 18,374,335 10,069,014 1,488,388 - -
UIC Common Stock - - - - - - 721,297 -
Participant loans - - - - - - - 2,037,716
------------------------------------------------------------------------------------------------------------------
Net assets
available for
benefits $38,403,907 $18,921,786 $2,264,569 $18,374,335 $10,069,014 $1,488,388 $ 735,605 $2,037,716
==================================================================================================================
DECEMBER 31, 1997
FIDELITY
FIDELITY RETIREMENT FIDELITY
FIDELITY MANAGED GOVERNMENT FIDELITY INVESTMENT UIC
MAGELLAN INCOME MONEY MARKET GROWTH & FIDELITY GRADE BOND FUNDCOMMON STOCK
FUND PORTFOLIO FUND INCOME FUND CONTRAFUND FUND LOAN FUND
------------------------------------------------------------------------------------------------------------------
Investments at
fair value:
Cash $ - $ - $ - $ - $ - $ - $ 18,894 $ -
Mutual Funds 29,569,273 18,245,430 1,776,549 14,254,151 8,190,740 754,347 - -
UIC Common Stock - - - - - - 801,651 -
Participant loans - - - - - - - 1,707,539
------------------------------------------------------------------------------------------------------------------
Net assets
available for
benefits $29,569,273 $ 18,245,430 $1,776,549 $14,254,151 $8,190,740 $754,347 $820,545 $1,707,539
==================================================================================================================
</TABLE>
6
<PAGE>
UIC 401(k) Retirement Savings Plan
Notes to Financial Statements (continued)
5. STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
(CONTINUED)
<TABLE>
<CAPTION>
DECEMBER 31, 1998
FIDELITY SPARTAN
TEMPLETON INVESCO LOW PRICED US
FOREIGN TOTAL STOCK EQUITY
A FUND RETURN FUND FUND INDEX FUND TOTAL
--------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Investments at fair value:
Cash $ - $ - $ - $ - $ 14,308
Mutual Funds 311,828 434,338 607,929 1,235,645 92,111,739
UIC Stock - - - - 721,297
Participant loans - - - - 2,037,716
--------------------------------------------------------------------------
Net assets available for
benefits $ 311,828 $ 434,338 $ 607,929 $1,235,645 $94,885,060
==========================================================================
DECEMBER 31, 1997
FIDELITY SPARTAN
TEMPLETON INVESCO LOW PRICED US
FOREIGN TOTAL STOCK EQUITY
A FUND RETURN FUND FUND INDEX FUND TOTAL
--------------------------------------------------------------------------
Investments at fair value:
Cash $ - $ - $ - $ - $ 18,894
Mutual Funds - - - - 72,790,490
UIC Common Stock - - - - 801,651
Participant loans - - - - 1,707,539
--------------------------------------------------------------------------
Net assets available for
benefits $ - $ - $ - $ - $75,318,574
==========================================================================
</TABLE>
7
<PAGE>
UIC 401(k) Retirement Savings Plan
Notes to Financial Statements (continued)
6. STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND
INFORMATION
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1998
--------------------------------------------------------------------------------------------------------------
FIDELITY
FIDELITY RETIREMENT FIDELITY
FIDELITY MANAGED GOVERNMENT FIDELITY INVESTMENT UIC
MAGELLAN INCOME MONEY GROWTH & FIDELITY GRADE BOND COMMON
FUND PORTFOLIO MARKET FUND INCOME FUND CONTRAFUND FUND STOCK FUND LOAN FUND
--------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ADDITIONS
Employee
contributions $ 1,659,799 $ 945,008 $ 189,532 $1,240,480 $ 747,702 $ 155,534 $105,693 $ -
Employer
contributions 559,744 366,030 121,435 397,542 256,341 69,440 34,567 -
Rollover
contributions 79,483 25,444 44,473 35,743 41,806 23,988 5,787 -
Investment income 1,785,532 1,044,674 98,619 987,918 741,751 73,397 31,745 181,391
--------------------------------------------------------------------------------------------------------------
4,084,558 2,381,156 454,059 2,661,683 1,787,600 322,359 177,792 181,391
DEDUCTIONS
Withdrawals (2,000,196) (1,152,624) (403,846) (1,431,990) (462,120) (62,452) (35,086) (63,621)
Net realized and
unrealized
(depreciation)
appreciation in
aggregate fair
value of
investments 7,889,470 - - 3,055,444 1,685,557 17,705 (55,287) -
Interfund transfers (1,139,198) (552,176) 437,807 (164,953) (1,132,763) 456,429 (172,359) 212,407
--------------------------------------------------------------------------------------------------------------
Net increase
(decrease) 8,834,634 676,356 488,020 4,120,184 1,878,274 734,041 (84,940) 330,177
Net assets available
for benefits at
beginning of year 29,569,273 18,245,430 1,776,549 14,254,151 8,190,740 754,347 820,545 1,707,539
--------------------------------------------------------------------------------------------------------------
Net assets available
for benefits at
end of year $38,403,907 $18,921,786 $2,264,569 $18,374,335 $10,069,014 $1,488,388 $735,605 $2,037,716
==============================================================================================================
</TABLE>
8
<PAGE>
UIC 401(k) Retirement Savings Plan
Notes to Financial Statements (continued)
6. STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND
INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1998
--------------------------------------------------------------------------
TEMPLETON INVESCO FIDELITY SPARTAN
FOREIGN TOTAL LOW PRICED US EQUITY
A FUND RETURN FUND STOCK FUND INDEX FUND TOTAL
---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
ADDITIONS
Employee contributions $ 42,759 $ 45,176 $ 91,728 $ 131,506 $ 5,354,917
Employer contributions 10,990 12,889 19,469 29,959 1,878,406
Rollover contributions 3,604 7,208 7,208 37,927 312,671
Investment income 30,540 18,795 49,758 14,655 5,058,775
---------------------------------------------------------------------------
87,893 84,068 168,163 214,047 12,604,769
DEDUCTIONS
Withdrawals (794) (25,251) (7,635) (4,257) (5,649,872)
Net realized and unrealized
(depreciation)
appreciation in aggregate
fair value of investments (61,537) 12,467 (76,576) 144,346 12,611,589
Interfund transfers 286,266 363,054 523,977 881,509 -
---------------------------------------------------------------------------
Net increase 311,828 434,338 607,929 1,235,645 19,566,486
Net assets available for
benefits at beginning of
year - - - - 75,318,574
---------------------------------------------------------------------------
Net assets available for
benefits at end of year $ 311,828 $ 434,338 $ 607,929 $1,235,645 $ 94,885,060
===========================================================================
</TABLE>
9
<PAGE>
UIC 401(k) Retirement Savings Plan
Notes to Financial Statements (continued)
6. STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND
INFORMATION (CONTINUED)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1997
--------------------------------------------------------------------------------------
FIDELITY
FIDELITY RETIREMENT FIDELITY
FIDELITY MANAGED GOVERNMENT FIDELITY INVESTMENT
MAGELLAN INCOME MONEY GROWTH & FIDELITY GRADE BOND
FUND PORTFOLIO MARKET FUND INCOME FUND CONTRAFUND FUND
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ADDITIONS
Employee contributions $ 1,711,164 $ 1,125,415 $ 198,524 $ 1,161,161 $ 738,627 $131,652
Employer contributions 474,114 339,193 104,766 301,981 207,041 43,912
Rollover contributions 48,493 261 11,900 49,131 24,639 725
Investment income 1,931,746 1,089,631 83,322 653,678 767,190 39,013
--------------------------------------------------------------------------------------
4,165,517 2,554,500 398,512 2,165,951 1,737,497 215,302
DEDUCTIONS
Withdrawals (2,897,011) (2,094,884) (214,493) (827,567) (459,255) (29,029)
Net realized and unrealized
appreciation in aggregate
fair value of investments 4,536,295 - - 2,518,129 613,067 16,639
Interfund transfers (1,366,404) (883,327) 60,031 878,604 1,115,982 69,918
--------------------------------------------------------------------------------------
Net increase (decrease) 4,438,397 (423,711) 244,050 4,735,117 3,007,291 272,830
Net assets available for
benefits at beginning of 25,130,876 18,669,141 1,532,499 9,519,034 5,183,449 481,517
year
--------------------------------------------------------------------------------------
Net assets available for
benefits at end of year $29,569,273 $18,245,430 $1,776,549 $14,254,151 $8,190,740 $754,347
======================================================================================
</TABLE>
TABLE CONTINUED......
<TABLE>
<CAPTION>
----------------------------------------
UIC
COMMON
STOCK FUND LOAN FUND TOTAL
----------------------------------------
<S> <C> <C> <C>
ADDITIONS
Employee contributions $ 71,580 $ - $ 5,138,123
Employer contributions 20,539 - 1,491,546
Rollover contributions - - 135,149
Investment income 20,466 159,329 4,744,375
----------------------------------------
112,585 159,329 11,509,193
DEDUCTIONS
Withdrawals (29,037) (55,120) (6,606,396)
Net realized and unrealized
appreciation in aggregate
fair value of investments 344,000 - 8,028,130
Interfund transfers 75,225 49,971 -
----------------------------------------
Net increase (decrease) 502,773 154,180 12,930,927
Net assets available for
benefits at beginning of 317,772 1,553,359 62,387,647
year
----------------------------------------
Net assets available for
benefits at end of year $820,545 $1,707,539 $75,318,574
========================================
</TABLE>
10
<PAGE>
UIC 401(k) Retirement Savings Plan
Notes to Financial Statements (continued)
7. YEAR 2000 (UNAUDITED)
The Plan Sponsor has determined that it will be necessary to take certain steps
in order to ensure that the Plan's information systems are prepared to handle
year 2000 dates. The Plan Sponsor is taking a two phase approach. The first
phase addressed internal systems that must be modified or replaced to function
properly. Both internal and external resources were utilized to replace or
modify existing software applications, and test the software and equipment for
the year 2000 modifications. The Plan Sponsor anticipates substantially
completing this phase of the project by September 1999. Costs associated with
modifying software and equipment were not significant and were paid by the Plan
Sponsor.
For the second phase of the project, Plan management established formal
communications with its third party service providers to determine that they
have developed plans to address their own year 2000 problems as they relate to
the Plan's operations. All third party service providers have indicated that
they will be year 2000 compliant by mid-year 1999. If modification of data
processing systems of either the Plan, the Plan Sponsor, or its service
providers are not completed timely, the year 2000 problem could have a material
impact on the operations of the Plan. Plan management has not developed a
contingency plan, because they are confident that all systems will be year 2000
ready.
11
<PAGE>
UIC 401(k) Retirement Savings Plan
EIN:95-2081809
Plan # 002
Line 27a--Schedule of Assets Held for Investment Purposes
December 31, 1998
<TABLE>
<CAPTION>
DESCRIPTION CURRENT
IDENTITY OF ISSUE OF INVESTMENT COST VALUE
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Fidelity Management Trust Company Cash
Reserve Fund $ 14,308 $ 14,308
Fidelity Magellan Fund 317,860 Shares 25,523,741 38,403,907
Fidelity Managed Income Portfolio 18,921,785 Shares 18,921,785 18,921,786
Fidelity Retirement Government Money Market
Fund 2,264,569 Shares 2,264,569 2,264,569
Fidelity Growth & Income Fund 400,836 Shares 12,299,121 18,374,335
Fidelity Contrafund 177,303 Shares 7,842,264 10,069,014
Fidelity Investment Grade Bond Fund 201,406 Shares 1,458,881 1,488,388
United Industrial Corporation Common Stock
73,508 Shares 631,003 721,297
Templeton Foreign A Fund 37,167 Shares 367,189 311,828
Invesco Total Return Fund 13,850 Shares 421,687 434,338
Fidelity Low Priced Stock Fund 26,605 Shares 669,650 607,929
Spartan US Equity Index Fund 28,108 Shares 1,098,235 1,235,645
Participant loans Interest rates from 7%
to 14.5%; maturities
to October, 2012
- 2,037,716
-----------------------------------
Total assets held for investment purposes $ 71,498,125 $ 94,885,060
===================================
</TABLE>
12
<PAGE>
UIC 401(k) Retirement Savings Plan
EIC: 95-2081809
Plan # 002
Line 27d--Schedule of Reportable Transactions
Year Ended December 31, 1998
<TABLE>
<CAPTION>
TOTAL DOLLAR VALUE TOTAL DOLLAR
IDENTITY OF PARTY NUMBER OF OF NUMBER VALUE OF
INVOLVED DESCRIPTION OF ASSETS PURCHASES PURCHASES OF SALES SALES NET GAIN
- -----------------------------------------------------------------------------------------------------------------------------------
Category (iii)--Series of transactions in excess of 5% of plan assets
- ---------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Fidelity Investments Magellan Fund 214 $5,902,855 173 $4,957,690 $1,084,886
Fidelity Investments Contrafund 190 2,913,037 125 2,720,319 453,518
Fidelity Investments Growth & Income Fund 201 4,267,276 140 3,202,536 786,246
Fidelity Investments Managed Income Portfolio 184 4,936,804 176 4,260,449 -
There were no category (i), (ii) or (iv) reportable transactions during 1998.
</TABLE>
13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the 401(k) Committee of the United Industrial Corporation 401(k)
Retirement Savings Plan (the "Plan"), which administers the Plan, has duly
caused this annual report to be signed on its behalf by the undersigned,
hereunto duly authorized, on the 25th day of June, 1999.
By: /s/ James H. Perry
--------------------------------
James H. Perry
Committee Member
3
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
23.1 Consent of Independent Auditors
Exhibit 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Form
S-8, Reg. No. 33-57065) pertaining to the UIC 401(k) Retirement Savings Plan of
United Industrial Corporation and in the related Prospectus of our report dated
May 28, 1999, with respect to the financial statements and supplemental
schedules of the UIC 401(k) Retirement Savings Plan included in this Annual
Report (Form 11-K) for the year ended December 31, 1998.
/s/ Ernst & Young LLP
Baltimore, Maryland
June 23, 1999
