<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1998
Commission file number: 1-11793
A. Full title of the Plan and address of the Plan, if different from that
of the issuer named below:
The Dial Corporation 401(k) Plan
B. Name of issuer of the securities held pursuant to the Plan and the
address of its principal executive office:
THE DIAL CORPORATION
15501 NORTH DIAL BOULEVARD
SCOTTSDALE, ARIZONA 85260-1619
SIGNATURE
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934,
The Dial Corporation 401(k) Plan has duly caused this annual report to be signed
on its behalf by the undersigned thereunto duly authorized.
THE DIAL CORPORATION
401(k) PLAN
By
Susan J. Riley
Senior Vice President and
Chief Financial Officer of
The Dial Corporation
DATE: June 9, 1999
<PAGE> 2
THE DIAL CORPORATION 401(k) PLAN
Financial Statements for the Years Ended December 31, 1998
and 1997, Supplemental Schedules for the Year Ended
December 31, 1998, and Independent Auditors' Report
<PAGE> 3
THE DIAL CORPORATION
401(k) PLAN
TABLE OF CONTENTS
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<TABLE>
<CAPTION>
Page
<S> <C>
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS AS OF
DECEMBER 31, 1998 AND 1997 AND FOR THE YEARS THEN ENDED:
Net Assets Available for Benefits 2
Changes in Net Assets Available for Benefits 3
Notes to Financial Statements 4-10
SUPPLEMENTAL SCHEDULES AS OF
DECEMBER 31, 1998 AND FOR THE YEAR THEN ENDED:
Assets Held for Investment Purposes 11
Reportable Transactions 12
EXHIBIT 23 - INDEPENDENT AUDITORS' CONSENT 13
</TABLE>
<PAGE> 4
INDEPENDENT AUDITORS' REPORT
Plan Administrator and Plan Participants
The Dial Corporation 401(k) Plan
Scottsdale, Arizona
We have audited the accompanying statements of net assets available for benefits
of The Dial Corporation 401(k) Plan (the "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 audits 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, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
1998 and 1997, and the changes in net assets available for benefits for the
years then ended in conformity with generally accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules for the year
ended December 31, 1998 on pages 11 and 12 are presented for the purpose of
additional analysis and are not a required part of the basic 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 schedules are the responsibility
of the Plan's management. Such schedules have been subjected to the auditing
procedures applied in our audit of the basic 1998 financial statements and, in
our opinion, are fairly stated, in all material respects when considered in
relation to the basic financial statements taken as a whole.
\s\ Deloitte & Touch LLP
Deloitte & Touche LLP
Phoenix, Arizona
June 7, 1999
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THE DIAL CORPORATION
401(k) PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1998 AND 1997
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<TABLE>
<CAPTION>
ASSETS 1998 1997
<S> <C> <C>
INVESTMENTS AT FAIR VALUE:
Shares of registered investment companies:
Vanguard Windsor II Fund $ 441,857 $ 389,733
T. Rowe Price Stable Value Fund 44,691 52,375
Vanguard GMA Fund 10,178 23,958
Common stock:
The Dial Corporation Common Stock Fund 132,947 106,487
FINOVA Group Inc. Common Stock Fund 7,973 8,828
Viad Corp Common Stock Fund 127,546 92,911
--------- ---------
NET ASSETS AVAILABLE FOR BENEFITS $ 765,192 $ 674,292
========= =========
</TABLE>
See notes to financial statements.
2
<PAGE> 6
THE DIAL CORPORATION
401(k) PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEARS ENDED DECEMBER 31, 1998 AND 1997
<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
ADDITIONS:
Contributions:
Employee pre-tax $ 19,942
Employee after-tax 116
---------
Total contributions 20,058
---------
Investment income:
Dividends $ 48,435 43,993
Interest 3,028 13,334
Net appreciation in fair value of investments 107,343 149,853
--------- ---------
Total investment income 158,806 207,180
--------- ---------
Total additions 158,806 227,238
--------- ---------
DEDUCTIONS:
Benefits paid to participants 67,906 108,437
Transfer of assets - 372,616
--------- ---------
Total deductions 67,906 481,053
--------- ---------
NET INCREASE/(DECREASE) 90,900 (253,815)
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR 674,292 928,107
--------- ---------
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR $ 765,192 $ 674,292
========= =========
</TABLE>
See notes to financial statements.
3
<PAGE> 7
THE DIAL CORPORATION
401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998 AND 1997
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1. DESCRIPTION OF THE PLAN
The following brief description of The Dial Corporation 401(k) Plan
(the "Plan"), is provided for general information purposes only.
Participants should refer to the Plan agreement for more complete
information.
The Plan, commonly known as the Taxsaver Investment Plan ("TIP"), was
established January 5, 1987. Employees of certain facilities of The
Dial Corporation (the "Company") who are covered by a collective
bargaining agreement are eligible to participate in the Plan after
completing at least 1,000 hours of service in a 12 consecutive month
period. Employees are able to contribute to the Plan by reducing their
wages on a pre-tax basis, and make after-tax contributions, subject to
certain limitations.
The Plan is subject to various regulations, particularly those under
Internal Revenue Code Section 401(k) and the Employee Retirement Income
Security Act of 1974 ("ERISA").
a. Investment Programs - Contributions to the Plan are invested
by the Plan's trustee, T. Rowe Price, at the designation of
the participants. The Plan has offered participants the
following funds in which to invest pre-tax, after-tax and
rollover deposits.
1) VANGUARD WINDSOR II FUND - This fund invests in the
common stock of selected companies. The fair value of
the fund is dependent upon the market value of the
stocks. Any dividends received are reinvested.
2) T. ROWE PRICE STABLE VALUE FUND - This fund invests
in a diversified portfolio of Guaranteed Investment
Contracts ("GIC") issued by insurance companies, bank
investment contracts issued by financial
institutions, and strategic investment contracts
issued by insurance companies, financial institutions
and other entities. Income is earned based upon a
blended interest rate determined by the various
investments and is reinvested. The fair value of the
fund approximates the aggregate contract values of
the GIC portfolio and represents contributions made,
plus interest at blended rates, less withdrawals by
participants. Crediting interest rates for the fund's
underlying GICs ranged from approximately 3.04% to
6.16% for 1998 and 4.77% to 8.41% for 1997, resulting
in a blended rate of return for the fund of 6.07% and
6.64%, for 1998 and 1997, respectively.
4
<PAGE> 8
3) VANGUARD GMA FUND - This fund invests primarily in
Government National Mortgage Association ("GNMA")
certificates. These securities represent ownership in
pools of approved mortgage loans which provide a
yield based on the ratios of return of the GNMA
holdings that comprise the portfolio. The fair value
of the fund is dependent upon fluctuations in market
conditions.
4) THE DIAL CORPORATION ("DIAL") COMMON STOCK FUND -
This fund invests in the common stock of Dial, and
any dividends paid on the stock are reinvested in the
fund. The fair value of this fund is dependent upon
the fluctuations in the market value of Dial stock.
5) FINOVA GROUP INC. ("FINOVA") COMMON STOCK FUND - This
fund invests in the common stock of FINOVA. Due to
this fund being closed to additional contributions,
any dividends paid on the stock are reinvested
according to the participant's contribution mix. The
fair value of this fund is dependent upon the
fluctuation in the market value of FINOVA stock.
6) VIAD CORP ("VIAD") COMMON STOCK FUND - This fund
invests in the common stock of Viad. Due to this fund
being closed to additional contributions, any
dividends paid on the stock are reinvested according
to the participant's contribution mix. The fair value
of this fund is dependent upon the fluctuation in the
market value of Viad stock.
b. Contributions - Voluntary wage reductions may be elected by
the employee. These pre-tax reductions are contributed to the
Plan and may range from 1% to 12% of compensation. Each
employee may also elect an after-tax contribution of between
1% and 10% of compensation. All contributions are limited to
the applicable amounts as prescribed by the Internal Revenue
Code. In 1997, due to the sale of the London, Ohio facility
to a third party, no more contributions were allowed to be
made to the Plan.
c. Transfer of Assets - On November 28, 1997, in connection with
the sale of the London, Ohio facility to a third party, the
respective assets within the Plan were transferred. Those
assets amounted to $372,616 and were valued at market value at
the time of the transfer.
d. Payment of Benefits - Benefits are paid to participants upon
termination from the Company, disablement, retirement or
death.
e. Hardship Withdrawals - Withdrawals of employee wage reduction
contributions, after-tax contributions and rollover deposits
may be made by the participant in the event of a qualified
financial hardship, subject to certain tax penalties. Upon
the sale of the London, Ohio facility, no further hardship
withdrawals were permitted.
f. Vesting - All contributions to the Plan are 100% vested and
nonforfeitable at all times.
5
<PAGE> 9
g. Participant Accounts - For each participant, various accounts
are maintained to record wage reduction contributions,
after-tax contributions, participant rollover deposits
transferred to the Plan, dividend and interest income and the
net appreciation/depreciation in the fair value of Plan
investments. The benefit to which a participant is entitled is
the total benefit which can be provided from the combined
amount of these participant accounts.
h. Plan Administration - The Plan is administered by the
Retirement Committee comprised of at least three persons
appointed by the Company's Board of Directors. Expenses
incidental to the operation of the Plan may be paid by the
Plan or directly by the Company. For the years ended December
31, 1998 and 1997, Plan expenses were paid directly by the
Company.
i. Plan Termination - While it is the Company's intention to
continue the Plan, the Company has the right to terminate the
Plan provided all employer contributions due at the
termination date have been paid.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Significant accounting policies are as follows:
a. Basis of Accounting - The financial statements of the Plan are
prepared under the accrual method of accounting.
b. Investment Valuation and Income Recognition - The Plan's
investments are stated at fair value. Shares of registered
investment companies are valued at quoted market prices.
Common stock is valued at its quoted market price. Purchases
and sales of securities are recorded on a trade-date basis.
Interest income is recorded on the accrual basis. Dividends
are recorded on the ex-dividend date.
c. Payment of Benefits - Benefits are recorded when paid.
d. Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles
requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and
disclosures at the date of the financial statements and the
reported amounts of additions and deductions during the
reporting period. Actual results could differ from those
estimates.
6
<PAGE> 10
3. NET ASSETS BY FUND
The following tables present the net assets of the Plan by fund as of December
31, 1998 and 1997:
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
DECEMBER 31, 1998
<TABLE>
<CAPTION>
T. ROWE THE DIAL FINOVA VIAD
PRICE CORPORATION GROUP INC. CORP
VANGUARD STABLE VANGUARD COMMON COMMON COMMON
WINDSOR VALUE GMA STOCK STOCK STOCK
II FUND FUND FUND FUND FUND FUND TOTAL
<S> <C> <C> <C> <C> <C> <C> <C>
---------------------------------------------------------------------------------
ASSETS
Investments at fair value:
Shares of registered
investment companies:
Vanguard Windsor II Fund $ 441,857 $ 441,857
T. Rowe Price Stable Value $ 44,691 44,691
Fund
Vanguard GMA Fund $ 10,178 10,178
Common stock:
The Dial Corporation $ 132,947 132,947
FINOVA Group Inc. $ 7,973 7,973
Viad Corp $ 127,546 127,546
--------- --------- --------- --------- --------- --------- ---------
NET ASSETS AVAILABLE
FOR BENEFITS $ 441,857 $ 44,691 $ 10,178 $ 132,947 $ 7,973 $ 127,546 $ 765,192
========= ========= ========= ========= ========= ========= =========
</TABLE>
7
<PAGE> 11
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
DECEMBER 31, 1997
<TABLE>
<CAPTION>
T. ROWE THE DIAL FINOVA VIAD
PRICE CORPORATION GROUP INC. CORP
VANGUARD STABLE VANGUARD COMMON COMMON COMMON
WINDSOR VALUE GMA STOCK STOCK STOCK
II FUND FUND FUND FUND FUND FUND TOTAL
<S> <C> <C> <C> <C> <C> <C> <C>
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ASSETS
Investments at fair value:
Shares of registered
investment companies:
Vanguard Windsor II Fund $ 389,733 $ 389,733
T. Rowe Price Stable Value
Fund $ 52,375 52,375
Vanguard GMA Fund $ 23,958 23,958
Common stock:
The Dial Corporation $ 106,487 106,487
FINOVA Group Inc. $ 8,828 8,828
Viad Corp $ 92,911 92,911
--------- --------- --------- --------- --------- --------- ---------
NET ASSETS AVAILABLE
FOR BENEFITS $ 389,733 $ 52,375 $ 23,958 $ 106,487 $ 8,828 $ 92,911 $ 674,292
========= ========= ========= ========= ========= ========= =========
</TABLE>
8
<PAGE> 12
4. FUND INFORMATION
Employee pre-tax contributions, employee after-tax contributions, dividend
income, net appreciation in fair value of investments, benefits paid to
participants, and transfer of assets are as follows for the years ended December
31, 1998 and 1997:
<TABLE>
<CAPTION>
Employee pre-tax contributions: 1998 1997
-------- --------
<S> <C> <C>
Vanguard Windsor II Fund $ - $ 4,370
T. Rowe Price Stable Value Fund - 12,268
Vanguard GMA Fund - 1,548
The Dial Corporation Common Stock Fund - 1,756
-------- --------
Total $ - $ 19,942
======== ========
Dividend income:
Vanguard Windsor II Fund $ 44,133 $ 36,437
Vanguard GMA Fund 1,195 3,656
The Dial Corporation Common Stock Fund 1,559 1,959
FINOVA Group Inc. Common Stock Fund 92 126
Viad Corp Common Stock Fund 1,456 1,815
-------- --------
Total $ 48,435 $ 43,993
======== ========
Net appreciation in fair value of investments:
Vanguard Windsor II Fund $ 19,434 $ 93,061
Vanguard GMA Fund 33 862
The Dial Corporation Common Stock Fund 38,321 35,824
FINOVA Group Inc. Common Stock Fund 495 4,206
Viad Corp Common Stock Fund 49,060 15,900
-------- --------
Total $107,343 $149,853
======== ========
Benefits paid to participants:
Vanguard Windsor II Fund $ 28,510 $ 29,584
T. Rowe Price Stable Value Fund 6,933 36,548
Vanguard GMA Fund 1,500 24,341
The Dial Corporation Common Stock Fund 15,184 8,416
FINOVA Group Inc. Common Stock Fund 1,350 771
Viad Corp Common Stock Fund 14,429 8,777
-------- --------
Total $ 67,906 $108,437
======== ========
</TABLE>
9
<PAGE> 13
<TABLE>
<S> <C> <C>
Transfer of assets:
Vanguard Windsor II Fund $ - $147,055
T. Rowe Price Stable Value Fund - 167,150
Vanguard GMA Fund - 22,822
The Dial Corporation Common Stock Fund - 19,692
FINOVA Group Inc. Common Stock Fund - 3,022
Viad Corp Common Stock Fund - 12,875
-------- --------
Total $ - $372,616
======== ========
</TABLE>
5. RELATED PARTY TRANSACTIONS
Plan investments include shares of the T. Rowe Price Stable Value Fund managed
by T. Rowe Price. T. Rowe Price is the trustee as defined by the Plan and,
therefore, these transactions qualify as party-in-interest.
6. FEDERAL INCOME TAX STATUS
The Plan obtained its latest determination letter on April 8, 1993, in which the
Internal Revenue Service stated that the Plan, as then designed, was in
compliance with the applicable requirements of the Internal Revenue Code. The
Plan has been amended since receiving the determination letter. However, the
Plan administrator and the Plan's tax counsel believe that the Plan is currently
designed and being operated in compliance with the applicable requirements of
the Internal Revenue Code. Therefore, no provision for income taxes has been
included in the Plan's financial statements.
10
<PAGE> 14
THE DIAL CORPORATION
401(k) PLAN
SUPPLEMENTAL SCHEDULE
DECEMBER 31, 1998
- --------------------------------------------------------------------------------
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
<TABLE>
<CAPTION>
COLUMN B COLUMN C COLUMN D COLUMN E
- --------------------------------------------------------------------------------------------------
Description of Investment
Identity of Issuer, Including Collateral, Rate of
Borrower, Lessor or Interest, Maturity Date, Current
Similar Party Par or Maturity Value Cost Value
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Vanguard Windsor II Fund Mutual Fund (14,803 shares) $ 300,197 $ 441,857
T. Rowe Price Stable Value Fund GIC Fund (44,691 shares) 44,691 44,691
Vanguard GMA Fund Mutual Fund (974 shares) 9,922 10,178
The Dial Corporation Common Stock (4,604 shares) 53,565 132,947
FINOVA Group Inc. Common Stock (148 shares) 1,156 7,973
Viad Corp Common Stock (4,199 shares) 48,120 127,546
---------- ----------
Total assets held for
investment purposes $ 457,651 $ 765,192
========== ==========
</TABLE>
11
<PAGE> 15
THE DIAL CORPORATION
401(k) PLAN
SUPPLEMENTAL SCHEDULE
YEAR ENDED DECEMBER 31, 1998
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN G COLUMN H COLUMN I
CURRENT
IDENTITY VALUE OF NET
OF DESCRIPTION ASSET ON GAIN
PARTY OF PURCHASE SELLING COST OF TRANSACTION OR
INVOLVED ASSET PRICE PRICE ASSET DATE (LOSS)
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
SINGLE TRANSACTIONS
- -----------------------------------------------------------------------------------------------------
Vanguard Windsor II Fund Mutual fund $ 41,518 $ 41,518 $ 41,518
- -----------------------------------------------------------------------------------------------------
SERIES OF TRANSACTIONS
- -----------------------------------------------------------------------------------------------------
Vanguard Windsor II Fund Mutual Fund 61,200 61,200 61,200
- -----------------------------------------------------------------------------------------------------
Vanguard Windsor II Fund Mutual Fund $ 28,510 16,355 28,510 $ 12,155
- -----------------------------------------------------------------------------------------------------
</TABLE>
NOTE: REPORTABLE TRANSACTIONS ARE THOSE TRANSACTIONS WHICH EITHER SINGULARLY
OR IN SERIES OF COMBINED PURCHASES AND SALES DURING THE YEAR EXCEED 5%
OF THE FAIR VALUE OF THE PLAN'S ASSETS AT THE BEGINNING OF THE YEAR.
12
<PAGE> 16
Index to Exhibits
Exhibit 23 - Independent Auditors' Consent
<PAGE> 1
Exhibit 23
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement No.
333-10153 of The Dial Corporation on Form S-8 of our report dated June 7, 1999,
appearing in the Annual Report on Form 11-K of The Dial Corporation 401(k) Plan
for the year ended December 31, 1998.
\s\ Deloitte & Touche LLP
Deloitte & Touche LLP
Phoenix, Arizona
June 7, 1999
13
