UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report: April 20, 1999
THE DIAL CORPORATION
Exact Name of Registrant as Specified in its Charter)
DELAWARE 51-0374887
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
15501 NORTH DIAL BOULEVARD
SCOTTSDALE, ARIZONA 85260-1619
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code (602) 754-3425
Item 5. Other Events.
On April 20, 1999, the Company issued two press releases relating to its
financial results for the first quarter of 1999 and the formation of a
joint venture with Henkel KGaA. Copies of both press releases are filed
herewith as Exhibit 99.
Item 7.
(C) Exhibits
(99.1) Press Release of the Company dated April 20, 1999, relating
to 1999 first quarter results.
(99.2) Press Release of the Company dated April 20, 1999, relating
to formation of a joint venture with Henkel KGaA.
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.
The Dial Corporation
April 27, 1999
/s/ Susan J. Riley
Senior Vice President and Chief Financial Officer
Nancy Stern - Corporate Affairs
602.754.4090
Bob Fulton - Investor Relations
602.754.1016
DIAL REPORTS FIRST QUARTER 1999 NET INCOME UP 13% TO
$0.26 PER SHARE ON 19% SALES INCREASE
Scottsdale, Ariz., April 20, 1999 - The Dial Corporation (NYSE: DL)
today reported a 13.0% increase in net income for its first quarter, over
the 1998 first quarter, driven by strong core sales growth and continued gross
margin improvement. Net income for the first quarter was $25.9 million, or
$0.26 per share (diluted), versus $22.9 million, or $0.23 per share (diluted),
in the 1998 first quarter.
Net sales for the quarter improved 19% to $399 million from $335 million
in the same period last year. This increase resulted from strong growth in the
Purex and Renuzit franchises, which grew at 20% and 39%, respectively, as well
as contributions from The Freeman Cosmetic Corporation, acquired in July 1998,
and Sarah Michaels,Inc., acquired in September 1998. The Purex franchise
instituted a price increase beginning in January of 1999. Sales net of the
Purex price increase improved 17% for the quarter.
Dial's gross margin in the first quarter increased to 49% from 47% in
the same period last year due to the price increase on Purex, continuing
success in improving efficiencies in the manufacturing facilities, and softer
raw material costs. Gross margin net of the Purex price increase was 48%, up
a full point from last year.
"We are very pleased to have again delivered another solid financial
and operating performance," said Mal Jozoff, Chairman and CEO. "Most
gratifying is the market share performance of our brands. Each of our
businesses is showing strong year-on-year gains in consumer purchases. These
share gains have produced our strong top-line growth which, together with our
focus on cost reduction, has resulted in our 11th quarter in a row of
superior results."
The Dial Corporation, headquartered in Scottsdale, Ariz., is one of
America's leading manufacturers of consumer products, including Dial soap,
Renuzit air fresheners, Purex laundry detergents, Armour Star canned meats
and the Sarah Michaels, Freeman Cosmetics and Nature's Accents personal care
brands. Dial products have been in the American marketplace for more than
100 years.
###
<PAGE>
<TABLE>
<CAPTION>
THE DIAL CORPORATION
SUMMARY OF OPERATIONS
In millions, except per share data
QUARTER ENDED
---------------------------------
APRIL 3, 1999 APRIL 4, 1998
--------------- ---------------
<S> <C> <C>
Net sales . . . . . . . . . . . . . . . . . . . $ 398.9 $ 335.0
--------------- ---------------
Costs and expenses:
Cost of products sold. . . . . . . . . . . . 202.4 176.5
Selling, general and administrative expenses 147.5 117.9
--------------- ---------------
349.9 294.4
Operating income. . . . . . . . . . . . . . . . 49.0 40.6
Interest and accretion . . . . . . . . . . . 8.4 4.8
--------------- ---------------
Income before income taxes. . . . . . . . . . . 40.6 35.8
Income taxes . . . . . . . . . . . . . . . . 14.7 12.9
--------------- ---------------
NET INCOME. . . . . . . . . . . . . . . . . . . $ 25.9 $ 22.9
=============== ===============
BASIC EARNINGS PER SHARE. . . . . . . . . . . . $ 0.26 $ 0.23
=============== ===============
DILUTED EARNINGS PER SHARE. . . . . . . . . . . $ 0.26 $ 0.23
=============== ===============
Basic shares outstanding. . . . . . . . . . . . 98.8 97.9
Common share equivalents . . . . . . . . . 2.1 2.1
--------------- ---------------
Diluted shares outstanding. . . . . . . . . . . 100.9 100.0
=============== ===============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
THE DIAL CORPORATION
CONDENSED BALANCE SHEET
In millions
APRIL 3, 1999 DECEMBER 31, 1998
-------------- ----------------
<S> <C> <C>
ASSETS
Current assets . . . . . . . . . . . . . . . $ 239.0 $ 239.1
Non-current assets . . . . . . . . . . . . . 918.5 936.3
-------------- ----------------
Total assets . . . . . . . . . . . . . . . $ 1,157.5 $ 1,175.4
============== ================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities. . . . . . . . . . . . . $ 208.8 $ 250.6
Long-term liabilities. . . . . . . . . . . . 543.7 534.6
Stockholders' equity . . . . . . . . . . . . 405.0 390.2
-------------- ----------------
Total liabilities and stockholders' equity $ 1,157.5 $ 1,175.4
============== ================
</TABLE>
<TABLE>
<CAPTION>
THE DIAL CORPORATION
CONDENSED STATEMENT OF CASH FLOWS
In millions
QUARTER ENDED
-------------
APRIL 3, 1999 APRIL 4, 1998
--------------- ----------------
<S> <C> <C>
Net cash provided (used) by operations . . . . . . . $ 0.5 $ (7.5)
Net cash provided (used) by investing activities . . (1.8) 3.4
Net cash provided (used) by financing activities . . (5.8) 1.9
--------------- ----------------
Net increase (decrease) in cash and cash equivalents (7.1) (2.2)
Cash and cash equivalents, beginning of year/period. . 12.4 10.1
--------------- ----------------
Cash and cash equivalents, end of period . . . . . . $ 5.3 $ 7.9
=============== ================
</TABLE>
For Dial
Bob Fulton (investors)
(602) 754-1016
Nancy Stern (media)
(602) 754-4090
For Henkel
Petra Hammerlein
011-49-211-797-3362
DIAL AND HENKEL FORM JOINT VENTURE TO DEVELOP AND MARKET
ENHANCED PUREX(R) LAUNDRY PRODUCTS IN NORTH AMERICA
Premium Purex(R) Detergents Will Use Henkel's Advanced Technology,
oadening Dial's Product Line and Providing Henkel Access to U.S. Market
Scottsdale, Ariz., and Dusseldorf, Germany, April 20, 1999 - The Dial
Corporation (NYSE:DL) and Henkel KGaA announced today that they have
signed an agreement to establish a joint venture to develop and market
a range of enhanced laundry products in North America under Dial's Purex
brand, the second most popular detergent in the U.S. The joint venture
company, which will be 50%-owned by Dial and 50%-owned by Henkel, will
be based in Scottsdale, Ariz., and is expected to have products in the
market by the end of this year.
Under the terms of the 10-year agreement, Henkel will make all
of its laundry technology available for new products. Dial will provide
manufacturing, distribution, marketing and sales resources, and contribute
the right to use its Purex trademark for enhanced products.
"This joint venture is a key element in Dial's growth strategy
for the future," said Mal Jozoff, Dial Chairman and Chief Executive Officer.
"We are pleased to be partnering with Henkel, a world leader in product
innovation. This joint venture offers Dial substantial long-term strategic
and financial benefits while protecting our ability to continue to create
shareholder value as an independent company. The Purex product line is one
of the cornerstones of Dial's business. Combining Henkel's technology and
financial resources with our strong Purex brand will enable us to expand
beyond the value segment of the detergent market where we compete today.
By adding complementary, enhanced performance products to extend the current
Purex product line, we believe we will create a new source of revenue in
our laundry business. Meanwhile, our current Purex product line, which has
grown strongly over the past year, is expected to continue its progress,"
Jozoff added.
The joint venture is expected to have no effect on Dial's earnings
per share this year and to be increasingly accretive thereafter.
"We are very excited about this long-term alliance with Dial which
builds on Henkel's already strong platform of consumer products in North
America," said Dr. Klaus Morwind, Executive Vice President-Detergents for
Henkel. "Applying our technological expertise to Dial's Purex products
- - which already enjoy excellent consumer recognition - will give us
unprecedented access to the highly competitive laundry products market in
North America. Henkel also will benefit from Dial's existing manufacturing
capacity, as well as its marketing, sales and distribution capabilities."
Dial's partnership with Henkel is initially limited to the laundry
products business in the United States and Canada. Henkel does not own any
Dial shares and is not permitted to do so without Dial's prior approval.
"Both companies see this partnership as important to one area of our
respective businesses, without changing either company's long-term strategic
objectives," Jozoff said.
The Dial Corporation, headquartered in Scottsdale, Ariz., is one of
America's leading manufacturers of consumer products, including Dial soaps,
Renuzit air fresheners, Purex laundry detergents, Armour Star canned meats
and the Sarah Michaels, Freeman Cosmetics and Nature's Accents personal
care brands. Dial products have been in the American marketplace for more
than 100 years.
Headquartered in Dusseldorf, Germany, Henkel KGaA is a global market
leader in specialty chemicals and consumer products. Henkel is the number
one producer of oleochemicals, adhesives and surface technologies worldwide,
as well as Europe's second largest producer of detergents and household
cleansers and a market leader in the European cosmetics and toiletries sector.
Approximately 15% of Henkel's worldwide revenues are generated in the United
States, but no U.S. revenues come from detergents. Henkel's preferred and
ordinary shares are listed on the Frankfurt Stock Exchange, as well as on a
number of other exchanges. In the United States, Henkel's ADRs, each
equivalent to one Henkel ordinary share, trade over the counter under
the symbol HENKY.
# # #
