SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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, 1999
--------------
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _____________ To _____________
Commission file number #1-4252
UNITED INDUSTRIAL CORPORATION
---------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 95-2081809
- --------------------------------------------------------------------------------
(State or other jurisdiction of incorporation) (I.R.S. Identification No.)
570 Lexington Avenue, New York, NY 10022
----------------------------------------------------
(Address of principal executive offices)
Not Applicable
-------------------------------------------------
Former name, former address and former fiscal year, if
changed since last report.
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 Act of 1934 during the
preceding 12 months (or for 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 ___
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date. 12,270,013 shares of common
stock as of May 3, 1999.
<PAGE>
UNITED INDUSTRIAL CORPORATION
INDEX
<TABLE>
<CAPTION>
Page #
Part I - Financial Information ------
<S><C> <C> <C>
Item 1. Financial Statements
Consolidated Condensed Balance Sheets - Unaudited
March 31, 1999 and December 31, 1998 1
Consolidated Condensed Statements of Operations -
Three Months Ended March 31, 1999 and 1998 2
Consolidated Condensed Statements of Cash Flows
Three Months Ended March 31, 1999 and 1998 3
Notes to Consolidated Condensed Financial Statements 4
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 5
Item 3. Qualitative and Quantitative Disclosures
about Market Risk 9
PART II - Other Information 10
</TABLE>
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM I - FINANCIAL STATEMENTS
UNITED INDUSTRIAL CORPORATION & SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(Dollars in Thousands)
<TABLE>
<CAPTION>
MARCH 31 DECEMBER 31
1999 1998
------------ -------------
<S> <C> <C>
ASSETS (Unaudited)
Current Assets
Cash & cash equivalents $ 16,558 $ 21,126
Marketable securities 5,884 4,702
Trade receivables 37,107 34,316
Inventories
Finished goods & work-in-process 24,981 20,151
Materials & supplies 3,597 3,418
-------- --------
28,578 23,569
Deferred income taxes 5,452 5,451
Prepaid expenses & other current assets 8,754 8,295
-------- --------
Total Current Assets 102,333 97,459
Other assets 56,649 56,421
Property & equipment - less allowances
for depreciation (1999-$84,146; 1998-$82,643) $ 30,884 30,566
-------- --------
$189,866 $184,446
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable $ 11,166 $ 12,235
Accrued employee compensation & taxes 8,823 8,320
Customer advances 13,739 4,303
Federal income taxes 2,258 2,973
Other liabilities 5,074 8,255
Provision for contract losses 3,853 4,558
-------- --------
Total Current Liabilities 44,913 40,644
Long-term liabilities 4,115 4,175
Deferred income taxes 6,933 7,050
Postretirement benefits other than pensions 23,276 23,136
Shareholders' Equity
Common stock $1.00 par value
Authorized - 30,000,000 shares; outstanding
12,268,013 and 12,250,063 shares -
1999 and 1998 (net of shares in treasury) 14,374 14,374
Additional capital 89,542 89,583
Retained earnings 23,337 22,249
Treasury stock, at cost, 2,106,135 at 1999
and 2,124,085 shares at 1998 (16,624) (16,765)
-------- --------
110,629 109,441
-------- --------
$189,866 $184,446
======== ========
</TABLE>
See accompanying notes
1
<PAGE>
UNITED INDUSTRIAL CORPORATION & SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended March 31
---------------------------
1999 1998 *
------------ -----------
(Unaudited)
<S> <C> <C>
Net sales $ 47,070 $ 47,227
Operating costs & expenses
Cost of sales 32,015 33,825
Selling & administrative 10,989 10,203
Other expense (income) - net 1,010 (91)
Interest expense 23 108
Interest income (619) (575)
-------- --------
43,418 43,470
-------- --------
Income before income taxes 3,652 3,757
Income taxes 1,338 1,434
-------- --------
Net income $ 2,314 $ 2,323
======== ========
Net earnings per share:
Basic $ .19 $ .19
===== -----
Diluted $ .19 $ .18
===== -----
</TABLE>
See accompanying notes
*Reclassified to conform with
1998 classifications
2
<PAGE>
UNITED INDUSTRIAL CORPORATION & SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31
1999 1998
-------- --------
OPERATING ACTIVITIES (Unaudited)
- --------------------
<S> <C> <C>
Net income $ 2,314 $ 2,323
Adjustments to reconcile net income
to net cash provided by
operating activities:
Depreciation and amortization 1,846 2,223
Deferred income taxes (118) 18
(Decrease) increase in contract loss provision (705) (193)
Changes in operating assets and liabilities (2,570) (3,774)
(Decrease) increase in federal income taxes (715) 943
-------- --------
Net Cash Provided by
Operating Activities 52 1,540
INVESTING ACTIVITIES
(Increase) decrease in marketable securities (1,182) 4,071
Purchase of property and equipment (1,946) (2,513)
(Increase) decrease in other assets - net (389) (254)
-------- --------
Net (Used in) Cash Provided by
Investing Activities (3,517) 1,304
FINANCING ACTIVITIES
Increase(decrease) in long-term liabilities 80 (404)
Proceeds from exercise of stock options 43 87
Payments on long-term debt & borrowings - (208)
Dividends (1,226) (1,225)
-------- --------
Net Cash Used in Financing Activities (1,103) (1,750)
-------- --------
(Decrease) increase in cash and cash equivalents (4,568) 1,094
Cash and cash equivalents at beginning
of period 21,126 23,098
-------- --------
Cash and cash equivalents at end
of period $ 16,558 $ 24,192
======== ========
</TABLE>
See accompanying notes
3
<PAGE>
UNITED INDUSTRIAL CORPORATION AND SUBSIDIARIES
Notes to Consolidated Condensed Financial Statements
March 31, 1999
Note A - Basis of Presentation
The accompanying unaudited consolidated condensed financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the three month period ended March 31, 1999
are not necessarily indicative of the results that may be expected for the year
ending December 31, 1999. For further information, refer to the consolidated
financial statements and footnotes thereto included in the Company's annual
report on Form 10-K for the year ended December 31, 1998.
Note B - Segment Information
<TABLE>
<CAPTION>
Trans- Reconci-
(dollars in thousands) Defense portation Energy Other liations Totals
Three months ended March 31, 1999 ------- --------- ------ ----- -------- ------
- ---------------------------------
<S> <C> <C> <C> <C> <C> <C>
Revenues from external customers $35,980 $ 2,650 $ 8,440 $ - $ - $47,070
Intersegment revenues 140 - - - (140) -
Equity profit (loss) in ventures 84 (1,336) - - - (1,252)
Segment profit (loss) 4,037 (1,143) 1,183 (426) - 3,651
Income before income taxes $ 3,651
=======
Three months ended March 31, 1998
Revenues from external customers $34,750 $ 2,456 $10,021 $ - $ - $47,227
Intersegment revenues 500 - - - (500) -
Equity profit (loss) in ventures - (58) - - - (58)
Segment profit (loss) 3,013 (408) 2,094 (942) - 3,757
Income before income taxes $ 3,757
=======
</TABLE>
Note C - Dividends
A quarterly dividend of $.10 per share is payable May 28, 1999.
4
<PAGE>
Item 2 - Management's Discussion and Analysis of Financial Condition
and Results of Operations
Forward Looking Information
- ---------------------------
This report contains "forward looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such forward looking
statements are based on management's expectations, estimates, projections and
assumptions. Words such as "expects," "anticipates," "intends," "plans,"
"believes," "estimates," and variations of such words and similar expressions
are intended to identify such forward looking statements which include, but are
not limited to, projections of revenues, earnings, segment performance, cash
flows and contract awards. These forward looking statements are subject to risks
and uncertainties which could cause the Company's actual results or performance
to differ materially from those expressed or implied in such statements. These
risks and uncertainties include, but are not limited to, the following: the
Company's successful execution of internal performance plans; performance issues
with key suppliers, subcontractors and business partners; legal proceedings;
product demand and market acceptance risks; the effect of economic conditions;
the impact of competitive products and pricing; product development,
commercialization and technological difficulties; capacity and supply
constraints or difficulties; legislative or regulatory actions impacting the
Company's energy segment and transportation business; changing priorities or
reductions in the U.S. Government defense budget; contract continuation and
future contract awards; U.S. and international military budget constraints and
determinations; and the ability of the Company and third parties to address the
Year 2000 issues adequately.
Results of Operations
- ---------------------
Three months ended March 31, 1999 compared to three months ended March 31, 1998:
Consolidated net sales decreased by $157,000 to $47,070,000 in the first quarter
of 1999 as compared to $47,227,000 in the same period in 1998. The Energy
segment sales decreased $1,581,000 or 16% to $8,440,000 in the first quarter of
1999 from $10,021,000 in the first quarter of 1998. Sales in the Defense segment
increased $1,230,000 or 4% to $35,980,000 in the first quarter of 1999, from
$34,750,000 in the same period in 1998 due primarily to a contract with the U.S.
Air Force to upgrade Maintenance Training Devices for the C-17 aircraft. During
the first quarter of 1998, Detroit Stoker Company, the Company's energy
subsidiary recorded sales of $2,800,000 on an unusually large overseas project
which was completed in 1998. Transportation segment sales increased $194,000 or
8% to $2,650,000 in the first quarter of 1999, from $2,456,000 in the first
quarter of 1998.
Gross margin increased to 32% in the first quarter of 1999 from 28.4% in the
first quarter of 1998, primarily due to increases in the Defense and
Transportation segments and partially offset by a decrease in the Energy
segment. The decrease in the Energy segment resulted from product mix and lower
sales volume. The lower gross margin in the Tranportation segment in the first
quarter of 1998 primarily resulted from initial costs required to establish this
business in its marketplace.
Selling and administrative expenses for the three months ended March 31, 1999
increased $786,000 or 7.7% to $10,989,000 in the first quarter of
5
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1999, from $10,203,000 in the first quarter of 1998. Beginning in 1999 the
Corporate overhead allocation charged to the operating units was increased.
Consequently, administrative fees in the Other segment were reduced $556,000
related to the increase in such fees received and a like amount increased these
costs in the operating segments. The Defense segment's selling and
administrative expenses increased $1,116,000, or 16.81% to $7,753,000, in the
first quarter of 1999 from $6,637,000 in the same period in 1998. The increase
was primarily due to the increase in the Corporate administrative fee
allocation, additional state tax on the sale of property and an increase in
research and development expenses. The Transportation segment increased expenses
by $235,000 in the first quarter of 1999 over the same period last year.
Other expense net increased $1,101,000 to $1,010,000 net expense in the first
quarter of 1999, from a net income of $91,000 in the first quarter of 1998. The
first quarter of 1998 included a $345,000 gain related to sales of certain
assets. Other expense in the Transportation segment increased $1,278,000 due to
an increase in the equity loss in its Electric Transit, Inc. ("ETI") venture.
ETI is owned 35% by AAI (a wholly owned subsidiary of the Company) and 65% by
Skoda, a Czech Republic firm. The Transportation segment recorded 100% of the
ETI loss of $1,336,000 in the first quarter of 1999 and in 1998 recorded its 35%
equity loss in ETI of $58,000. (See Liquidity and Capital Resources discussion
below.)
Interest expense decreased by $85,000 due to reduced borrowings.
Interest income increased by $44,000 due to advances to joint ventures.
Net income was $2,314,000 or $.19 per diluted share in the first three months of
1999, compared to net income of $2,323,000 or $.18 per diluted share in the same
period of 1998.
Liquidity and Capital Resources
- -------------------------------
Cash and cash equivalents decreased $4,568,000 to $16,558,000 at March 31, 1999
from $21,126,000 at December 31, 1998. In addition the Company's investments in
marketable securities increased $1,182,000 to $5,884,000 at March 31, 1999 from
$4,702,000 at December 31, 1998. Changes in operating assets and liabilities of
$2,570,000 were offset by net income of $2,314,000. The major items contributing
to the decrease in cash were the increase in marketable securities and dividends
of $1,226,000. Receivables from Electric Transit, Inc. ("ETI") amounted to
$23,265,000 at March 31, 1999 and $22,375,000 at December 31, 1998. The Company
currently has no significant fixed commitment for capital expenditures. The
Company expects that available cash and existing lines of credit will be
sufficient to meet its cash requirements for the remainder of the calendar year.
Its cash requirements consist primarily of its obligation to fund operations.
In 1993, AAI Corporation, a wholly owned subsidiary of the Company ("AAI"),
organized a new subsidiary, ETI, to manufacture electric trolley buses ("ETB's")
for the U.S. market. In 1994 and again in 1995, ETI conveyed equity interests to
Skoda, a Czech Republic firm. Consequently, ETI is owned 35% by AAI and 65% by
Skoda and the Company had previously recorded its equity share of income or loss
in ETI accordingly.
Management has recently learned that Skoda will likely be unable to secure the
necessary financing to execute its subcontract on the San Francisco
6
<PAGE>
electric trolley bus program and to meet its funding obligations to ETI. This
situation has reduced ETI's ability and willingness to continue to finance Skoda
Ostrov s.r.o., Skoda's ETB manufacturing subsidiary which has the subcontract
arrangement with ETI until this problem is alleviated. As a result, contract
performance by ETI has been adversely affected. ETI and Skoda were until
recently negotiating with a bank to obtain credit facilities that along with
customer advances would have provided the funds necessary to meet the working
capital requirements of both ETI and Skoda Ostrov. This bank has withdrawn from
the negotiation, but has expressed a willingness to revisit an arrangement if
the ownership of these entities should change.
Due to Skoda's inability to fund ETI as required under ETI's shareholder
agreement, AAI has assumed that responsibility in the entirety. Consequently,
the loss representing a 100% share of the loss in ETI of $1.3 million or
$839,000, net of tax, during the first quarter of 1999, has been provided for by
AAI in the accompanying financial statements. This loss was primarily caused by
cost growth on the Dayton ETB program during the current quarter. The delivery
of these buses is expected to be completed during the third quarter of 1999.
Skoda's production delays on the San Francisco project will likely diminish the
profitability of that contract. Since sales and gross margin are recorded when
the units are delivered, the delays in trolley bus deliveries will result in
continued losses throughout 1999.
Contract performance on the two electric trolley bus programs will now depend on
AAI advancing working capital funds as required. In order to minimize delays and
gain the ability to control the manufacture and delivery of the ETB's, AAI and
Skoda have signed a letter of intent for AAI to acquire Skoda Ostrov and all of
Skoda's shares in ETI. When consummated, the transaction will provide the
Company with a 100% ownership-interest in ETI.
The closing of the transaction is subject to execution and delivery of
definitive documents and several closing conditions and, accordingly, no
assurances can be given that this transaction will be consummated.
If this transaction is not consummated and ETI and Skoda are unable to obtain
alternative sources of financing, it is likely to have a material adverse effect
on the Company's results of operations, liquidity and financial condition.
Year 2000
- ---------
The Year 2000 issue exists because many currently installed computer systems and
software programs were designed to use only a two-digit date field. These date
fields will need to accept four digits to distinguish 21st century dates from
20th century dates. Until the date fields are revised, the systems and programs
could fail or give erroneous results when referencing dates subsequent to
December 31, 1999. Such failures or errors could occur prior to the actual
change in century.
The Company is currently implementing a six phase plan to address this problem:
Awareness, Assessment, Remediation, Validation/Test, Implementation, and
Contingency Planning. The Awareness phase is a communication phase to inform
employees, suppliers and customers of the Year 2000 issue. The Assessment phase
is an inventory and analysis of
7
<PAGE>
those systems which may have a problem. The Remediation phase is the correction
phase for the problem. The Validation/Test phase is used to verify that
corrections have been made properly and completely. The Implementation phase is
to actually put the changed systems into production use. The Contingency
Planning phase is the development of a plan to detail the Company's reactions to
possible future scenarios concerning the Year 2000 issue.
These plans are being implemented on both the Information Technology (IT) areas
and the non-IT areas for the transition to the 21st century. IT areas include
all computer system hardware and software. Non-IT areas include systems that
have embedded computer chips or microprocessors.
The Awareness and Assessment phases are complete for the IT and non-IT systems.
The IT systems are estimated to be 95% complete in the Remediation phase and are
expected to be completed through the Implementation phase by June 1999. Non-IT
systems are estimated to be 95% complete in the Remediation phase and are
expected to be completed through the Implementation phase by June 1999.
Many of the Company's products do not require computer systems or do not perform
any data processing. These products are currently compliant. Other products have
been remediated and are currently compliant. Still other products cannot be
remediated because they are based on obsolete computer systems. The Company is
working on a case by case basis with its customers to alleviate Year 2000 issues
with these products. Although the Company's products continue to undergo normal
quality testing procedures, there can be no assurance that these products will
contain all necessary date code changes. Any system malfunctions due to the
onset of the Year 2000 and any disputes with customers relating to Year 2000
compliance could have a material adverse effect on the Company's business,
financial condition or results of operations.
The Company has contacted its IT suppliers asking for Year 2000 compliance
statements and status. Each vendor has responded with information necessary to
ensure their products compliance. The Company is in the pro cess of completing
the steps necessary to make these hardware and software systems compliant by
June 1999.
Significant non-IT suppliers to the Company were contacted to determine their
compliance during the fourth quarter of 1998. This is necessary to ensure that
the Company's products are not delayed due to lack of parts or services. Also,
embedded chips in process control equipment, lighting controls, and security
systems are being inspected to assure that they will operate properly in the
Year 2000.
While the Company has not fully identified all the impacts of the Year 2000
issue or whether all related problems can be resolved without disrupting its
business and incurring significant expense, the Company's current estimate is
that the costs associated with the Year 2000 issue, and the consequences of
incomplete or untimely resolution of the Year 2000 issue, will not have a
material adverse effect on the Company's business, operating results or
financial condition. The current estimate of the costs of remediating Year 2000
issues is $700,000. Of the $700,000 approximately $435,000 is budgeted to
replace existing hardware and software and $265,000 is budgeted to fix or
upgrade existing hardware or software. Of these budgets $550,000 has been spent
to date. These costs are less than 10% of the normal IT budget for the Company.
These costs are
8
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being budgeted through the normal operating budgets of the Company and should
not have a major impact on other IT projects or systems.
The Company is currently in the process of identifying potential consequences to
the Company if its IT and non-IT systems do not function properly on account of
the Year 2000 issue (i.e., most reasonably likely worst case scenarios).
Management expects to complete this process by mid 1999. If the Company
determines that such consequences could have a material adverse effect on the
business, operating results or financial condition, it intends to establish a
contingency plan to address the most reasonably likely worst case scenarios.
However, in cases beyond the control of the Company there could be some adverse
effects. This would be particularly true if major infrastructure systems such as
electric distribution grids or major telephone switching centers are disrupted
by the Year 2000 issue. Every reasonable effort will be made to minimize these
effects.
The costs of the Company's year 2000 project and dates on which the Company
believes it will complete such efforts are based on management's current best
estimates, which were derived using numerous assumptions regarding future
events. There can be no assurances that these estimates will prove to be
accurate, and therefore actual results could differ materially from those
anticipated. Specific factors that could cause material differences with actual
results include, but are not limited to, the results of testing and the
timeliness and effectiveness of remediation efforts of third parties.
Contingent Matters
- ------------------
Reference is made to Item 3. Legal Proceedings, in the annual report on Form
10-K for the year ended December 31, 1998, which is incorporated herein by
reference.
Item 3 - Qualitative and Quantitative Disclosures about Market Risk
A portion of the Company's operations consists of manufacturing and sales
activities in foreign jurisdictions, and some of these transactions are
denominated in foreign currencies. As a result, the Company's financial results
could be affected by changes in foreign exchange rates. To mitigate the effect
of changes in these rates, the Company has entered into two foreign exchange
contracts. There has been no material change in the firmly committed sales
exposures and related derivative contracts from December 31, 1998. (See Item 7A
- - Form 10-K for December 31, 1998.)
9
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UNITED INDUSTRIAL CORPORATION AND SUBSIDIARIES
PART II - Other Information
Item 4 - Submission of Matters to a Vote of Security Holders
(a) The Annual Meeting of Shareholders of the Registrant was held on May
11, 1999.
(b) Richard R. Erkeneff and E. Donald Shapiro were elected directors at
the meeting, for terms ending in 2002. The incumbent directors whose
terms of office continued after the meeting are Edward C. Aldridge,
Jr., Joseph S. Schneider, Harold S. Gelb and Susan Fein Zawel.
(c) Voting for the election of directors of the Registrant:
WITHHELD (including
FOR broker non-votes)
Richard R. Erkeneff 9,993,060 1,108,336
E. Donald Shapiro 9,992,316 1,109,080
Other Matters:
10,894,316 shares were voted in favor of the proposal to ratify the
appointment of Ernst & Young LLP as independent auditors of the Registrant
for 1999 with 145,633 shares voted against, 61,450 abstentions and 3
broker non-votes. 8,848,747 shares were voted in favor of adopting the
1994 Stock Option Plan, as amended, with 2,138,115 shares voted against,
114,528 abstentions and 12 broker nonvotes. Reference is made to the
Registrant's Proxy Statement dated March 25, 1999 for its 1999 Annual
Meeting for additional information concerning the matters voted on at the
meeting.
Item 6 - Exhibits and Reports on Form 8-K
(a) Exhibits
11 - Computation of Earnings per share
27 - Financial Data Schedule
(b) The Registrant did not file any reports on Form 8-K during the
quarter ended March 31, 1999.
10
<PAGE>
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.
UNITED INDUSTRIAL CORPORATION
Date May 14, 1999 By: /s/ James H. Perry
------------ -------------------------------
James H. Perry
Chief Financial Officer
Vice President and
Treasurer
11
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UNITED INDUSTRIAL CORPORATION AND SUBSIDIARIES
INDEX OF EXHIBITS FILED HEREWITH
Exhibit No. Page
- ----------- ----
11 Computation of Earnings Per Share 13
27 Financial Data Schedule 14
12
EXHIBIT 11 - Computation of Earnings Per Share
Item 6(a)
Exhibit 11
Computation of Earnings per Share
United Industrial Corporation and Subsidiaries
THREE MONTHS ENDED MARCH 31
---------------------------
1999 1998
-------- --------
Net income $ 2,314,000 $ 2,323,000
=========== ===========
Basic earnings per share:
Weighted average shares 12,258,713 12,254,363
=========== ===========
Effect of dilutive securities:
Employee stock options $ 226,297 $ 344,542
=========== ===========
Diluted earnings per share:
Adjusted weighted-average
and assumed conversions 12,485,010 12,598,905
=========== ===========
Basic earnings per share $ .19 $ .19
===== =====
Diluted earnings per share $ .19 $ .18
===== =====
- --------------------------------------------------------------------------------
13
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS INCLUDED IN THE ACCOMPANYING FORM 10-Q AND IS QUALIFIED IN
ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 16,558
<SECURITIES> 5,884
<RECEIVABLES> 37,107
<ALLOWANCES> 0
<INVENTORY> 28,578
<CURRENT-ASSETS> 102,333
<PP&E> 115,030
<DEPRECIATION> 84,146
<TOTAL-ASSETS> 189,866
<CURRENT-LIABILITIES> 44,913
<BONDS> 4,115
0
0
<COMMON> 14,374
<OTHER-SE> 96,255
<TOTAL-LIABILITY-AND-EQUITY> 189,866
<SALES> 47,070
<TOTAL-REVENUES> 47,689
<CGS> 32,015
<TOTAL-COSTS> 43,004
<OTHER-EXPENSES> 1,010
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 23
<INCOME-PRETAX> 3,652
<INCOME-TAX> 1,338
<INCOME-CONTINUING> 2,314
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,314
<EPS-PRIMARY> .19
<EPS-DILUTED> .19
</TABLE>
