<PAGE> 1
================================================================================
FORM 10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
================================================================================
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTER ENDED SEPTEMBER 30, 1999 OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission file number 1-12317
NATIONAL-OILWELL, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 76-0475815
---------------------------------- --------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
10000 RICHMOND AVENUE
4TH FLOOR
HOUSTON, TEXAS
77042-4200
---------------------------------------------------
(Address of principal executive offices)
(713) 346-7500
---------------------------------------------------
(Registrant's telephone number, including area code)
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 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
---- ----
As of November 12, 1999, 58,258,955 common shares were outstanding, assuming the
exchange on a one-for-one basis of all Exchangeable Shares of Dreco Energy
Services Ltd. into shares of National-Oilwell, Inc. common stock.
<PAGE> 2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
NATIONAL-OILWELL, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
September 30, December 31,
1999 1998
------------- -------------
(Unaudited)
ASSETS
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 15,579 $ 11,963
Receivables, less allowance of $5,482 and $4,963 172,849 301,405
Inventories 232,554 253,385
Deferred income taxes 7,206 16,489
Prepaids and other current assets 9,061 7,677
------------- -------------
437,249 590,919
Property, plant and equipment, net 108,321 96,174
Deferred income taxes 15,553 6,757
Goodwill 165,136 145,696
Property held for sale 10,258 9,981
Other assets 5,200 6,361
------------- -------------
$ 741,717 $ 855,888
============= =============
LIABILITIES AND OWNERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 22 $ 8,427
Accounts payable 89,803 131,575
Customer prepayments 5,263 25,392
Accrued compensation 4,610 7,237
Other accrued liabilities 40,549 54,158
------------- -------------
140,247 226,789
Long-term debt 194,608 221,198
Deferred income taxes 2,528 4,097
Other liabilities 12,426 10,505
------------- -------------
349,809 462,589
Commitments and contingencies
Stockholders' equity:
Common stock - par value $.01; 58,258,955 shares
and 57,916,785 shares issued and outstanding
at September 30, 1999 and December 31, 1998 583 579
Additional paid-in capital 246,807 248,194
Accumulated other comprehensive income (12,849) (13,821)
Retained earnings 157,367 158,347
------------- -------------
391,908 393,299
------------- -------------
$ 741,717 $ 855,888
============= =============
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE> 3
NATIONAL-OILWELL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
----------------------------- -----------------------------
1999 1998 1999 1998
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Revenues $ 168,244 $ 330,205 $ 546,932 $ 977,711
Cost of revenues 138,194 252,904 442,339 758,295
---------- ---------- ---------- ----------
Gross profit 30,050 77,301 104,593 219,416
Selling, general and administrative 29,196 39,164 90,873 105,112
---------- ---------- ---------- ----------
Operating income 854 38,137 13,720 114,304
Other income (expense):
Interest and financial costs (3,958) (5,071) (11,429) (9,242)
Interest income 262 251 560 750
Other 247 106 (2,452) (448)
---------- ---------- ---------- ----------
Income (loss) before income taxes (2,595) 33,423 399 105,364
Provision (benefit) for income taxes (723) 12,426 1,379 39,121
---------- ---------- ---------- ----------
Net income (loss) $ (1,872) $ 20,997 $ (980) $ 66,243
========== ========== ========== ==========
Net income per share:
Basic $ (0.03) $ 0.38 $ (0.02) $ 1.22
========== ========== ========== ==========
Diluted $ (0.03) $ 0.38 $ (0.02) $ 1.21
========== ========== ========== ==========
Weighted average shares outstanding:
Basic 58,258 55,233 58,246 54,339
========== ========== ========== ==========
Diluted 58,258 55,309 58,269 54,566
========== ========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE> 4
NATIONAL-OILWELL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
Nine Months Ended September 30,
---------------------------------
1999 1998
------------ ------------
<S> <C> <C>
Cash flow from operating activities:
Net income $ (980) $ 66,243
Adjustments to reconcile net income to net cash
provided (used) by operating activities:
Depreciation and amortization 15,661 15,236
Provision for losses on receivables 1,663 (301)
Provision for deferred income taxes (1,587) (725)
Loss (gain) on sale of assets (1,320) (2,458)
Foreign currency transaction loss (248) (161)
Changes in assets and liabilities, net of acquisitions and divestments:
Receivables 129,414 5,659
Inventories 21,944 (30,259)
Prepaid and other current assets (1,636) 1,664
Accounts payable (63,098) (25,691)
Other assets/liabilities, net (15,133) (18,241)
------------ ------------
Net cash provided by operating activities 84,680 10,966
------------ ------------
Cash flow from investing activities:
Purchases of property, plant and equipment (12,004) (19,609)
Proceeds from sale of assets 30,650 5,329
Business acquired, net of cash (65,000) (157,739)
Cash received from business acquired -- 535
------------ ------------
Net cash provided (used) by investing activities (46,354) (171,484)
------------ ------------
Cash flow from financing activities:
Borrowings (payments) on line of credit (34,995) 57,511
Net proceeds from issuance of long-term debt -- 148,937
Principal payments on long-term debt -- (40,855)
Proceeds from stock options exercised 148 1,002
------------ ------------
Net cash provided (used) by financing activities (34,847) 166,595
------------ ------------
Effect of exchange rate loss (gain) on cash 137 (4,935)
------------ ------------
Increase in cash and equivalents 3,616 1,142
Cash and cash equivalents, beginning of period 11,963 20,391
------------ ------------
Cash and cash equivalents, end of period $ 15,579 $ 21,533
============ ============
Supplemental disclosures of cash flow information:
Cash payments during the period for:
Interest $ 7,687 $ 4,144
Income taxes 12,037 42,273
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE> 5
NATIONAL-OILWELL, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. BASIS OF PRESENTATION
Information concerning common stock and per share data has been restated on an
equivalent share basis and assumes the exchange of all Exchangeable Shares
issued in connection with the combination with Dreco Energy Services Ltd. The
Company employs accounting policies that are in accordance with generally
accepted accounting principles in the United States which requires Company
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements, and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
The accompanying unaudited consolidated financial statements present information
in accordance with generally accepted accounting principles for interim
financial information and the instructions to Form 10-Q and applicable rules of
Regulation S-X. Accordingly, they do not include all information or footnotes
required by generally accepted accounting principles for complete financial
statements and should be read in conjunction with the Company's 1998 Annual
Report on Form 10-K.
In the opinion of the Company, the consolidated financial statements include
all adjustments, all of which are of a normal, recurring nature, necessary for a
fair presentation of the results for the interim periods. The results of
operations for the nine months ended September 30, 1999 and 1998 may not be
indicative of results for the full year. No significant accounting changes have
occurred during the nine months ended September 30, 1999.
On July 1, 1999, the Company purchased 100 % of the outstanding stock of Dupre'
Supply Company and Dupre' International Inc. in exchange for 1,920,000 shares of
National Oilwell common stock. These companies are leading suppliers of pipe,
fittings, valves and valve automation services and complement the existing
operations of the Distribution Services segment. This transaction has been
accounted for under the pooling-of-interests method of accounting and,
accordingly, historical financial statements have been restated.
On July 8, 1999, the Company acquired the assets of CE Drilling Products, Inc.
for approximately $65 million in cash, financed primarily by borrowing $57
million under its revolving credit facility. This business involves the
manufacture, sale and service of drilling machinery and related parts. This
transaction has been accounted for under the purchase method of accounting.
2. INVENTORIES
Inventories consist of (in thousands):
<TABLE>
<CAPTION>
September 30, December 31,
1999 1998
------------- -------------
<S> <C> <C>
Raw materials and supplies $ 18,500 $ 24,304
Work in process 27,231 39,991
Finished goods and purchased products 186,823 189,090
------------- -------------
Total $ 232,554 $ 253,385
============= =============
</TABLE>
3. RECENTLY ISSUED ACCOUNTING STANDARDS
In June 1998, the Financial Accounting Standards Board issued Statement No. 133,
Accounting for Derivative Instruments and Hedging Activities, which requires the
recognition of all derivatives on the balance sheet at fair value. The Company
will adopt the new Statement effective January 1, 2001 and anticipates it will
have no significant effect on its results of operations or financial position.
4
<PAGE> 6
4. COMPREHENSIVE INCOME
Total comprehensive income was as follows (in thousands):
<TABLE>
<CAPTION>
1999 1998
-------- --------
<S> <C> <C>
Three months ended September 30 $ (5,400) $ 17,798
Nine months ended September 30 (8) 59,427
</TABLE>
5. BUSINESS SEGMENTS
Effective January 1, 1999, the Company changed the structure of its internal
organization and now includes the former Downhole Products segment as a product
line within the Products and Technology segment. Prior year segment information
has been restated to reflect this change.
Segment information (unaudited) follows (in thousands):
<TABLE>
<CAPTION>
Quarter Ended September 30, Nine Months Ended September 30,
----------------------------------- -----------------------------------
1999 1998 1999 1998
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Revenues from unaffiliated customers
Products and Technology $ 66,982 $ 191,285 $ 242,764 $ 512,684
Distribution Services $ 101,263 $ 138,920 $ 304,169 $ 479,164
Intersegment revenues
Products and Technology 5,662 19,799 21,346 42,087
Distribution Services 490 106 863 106
Operating Income (loss)
Products and Technology 2,755 38,154 24,043 107,370
Distribution Services (633) 1,887 (6,215) 11,945
------------- ------------- ------------- -------------
Total profit for reportable segments 2,122 40,041 17,828 119,315
Unallocated corporate costs (1,268) (1,904) (4,108) (5,011)
Net interest expense (3,696) (4,820) (10,869) (8,492)
Other income (expense) 247 106 (2,452) (448)
------------- ------------- ------------- -------------
Income before income taxes $ (2,595) $ 33,423 $ 399 $ 105,364
============= ============= ============= =============
</TABLE>
<TABLE>
<CAPTION>
September 30, September 30,
1999 1998
------------- -------------
<S> <C> <C>
Total assets
Products and Technology $ 553,848 $ 617,936
Distribution Services $ 187,420 $ 184,323
</TABLE>
5
<PAGE> 7
6. SALE OF ASSETS
Included in Other Expense are losses totaling $1.9 million from the sale of
assets related to two product lines. On June 17, 1999, the Company sold its
tubular product line for approximately $15 million, generating a pre-tax loss of
$0.9 million ($0.5 million after-tax). Revenues and operating loss recorded in
1999 for the tubular operations were $23.6 million and $0.6 million,
respectively. On June 24,1999, the Company sold its drill bit product line for
approximately $12 million, recording a pre-tax loss of $1.0 million ($0.6
million after-tax). Revenues and operating income recorded in 1999 for the drill
bit operations were $6.1 million and $0.1 million, respectively.
7. SUBSEQUENT EVENTS
On October 11, 1999, the Company announced the signing of a definitive agreement
to acquire all of the outstanding shares of Hitec ASA, a Norwegian company, in
exchange for 8 million shares of National Oilwell common stock and NOK 148.7
million (approximately U.S. $ 20 million). Immediately prior to the closing,
Hitec will sell its non-drilling related business to a new company for NOK 148.7
million. The transaction is subject to various conditions, including regulatory
approvals, and will be accounted for under the purchase method of accounting.
6
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
INTRODUCTION
National Oilwell is a worldwide leader in the design, manufacture and sale of
machinery and equipment and in the distribution of maintenance, repair and
operating products used in oil and gas drilling and production. National
Oilwell's revenues are directly related to the level of worldwide oil and gas
drilling and production activities and the profitability and cash flow of oil
and gas companies and drilling contractors, which in turn are affected by
current and anticipated prices of oil and gas. Beginning in late 1997, oil
prices declined to less than $15 per barrel due to concerns about excess
production, less demand from Asia due to an economic slowdown and warmer than
average weather in many parts of the United States. The resulting lower demand
for products and services had an increasingly negative effect on the
Distribution Services business throughout 1998 and on both segments in 1999. Oil
prices have recovered since late July 1999 to a range of $20-$25 per barrel.
National Oilwell expects its revenues to increase if its customers gain
confidence in sustained commodity prices at this level and as their cash flows
from operations improve allowing them to purchase products sold by National
Oilwell.
RESULTS OF OPERATIONS
Operating results by segment are as follows (in thousands):
<TABLE>
<CAPTION>
Quarter Ended Nine Months Ended
September 30, September 30,
----------------------------------- -----------------------------------
Revenues 1999 1998 1999 1998
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Products and Technology $ 72,644 $ 211,084 $ 264,110 $ 554,771
Distribution Services 101,753 139,026 305,032 479,270
Eliminations (6,153) (19,905) (22,210) (56,330)
------------- ------------- ------------- -------------
Total $ 168,244 $ 330,205 $ 546,932 $ 977,711
============= ============= ============= =============
Operating Income
Products and Technology $ 2,755 $ 38,154 $ 24,043 $ 107,370
Distribution Services (633) 1,887 (6,215) 11,945
Corporate (1,268) (1,904) (4,108) (5,011)
------------- ------------- ------------- -------------
Total $ 854 $ 38,137 $ 13,720 $ 114,304
============= ============= ============= =============
</TABLE>
Products and Technology
The Products and Technology segment designs and manufactures a large line of
proprietary products, including drawworks, mud pumps, power swivels, electrical
control systems and downhole motors and tools, as well as complete land drilling
and well servicing rigs, and structural components such as cranes, masts,
derricks and substructures for offshore rigs. A substantial installed base of
these products results in a recurring replacement parts and maintenance
business. Sales of new capital equipment can result in large fluctuations in
volume between periods depending on the size and timing of the shipment of
orders. This segment also provides drilling pump expendable products for
maintenance of National Oilwell's and other manufacturers' equipment.
Effective January 1, 1999, the Company changed the structure of its internal
organization and now includes the former Downhole Products segment as a product
line within the Products and Technology segment. Prior year segment information
has been restated to reflect this change. The Company sold its drill bit product
line in June 1999 for approximately $12 million, recording a pre-tax loss of
$1.0 million ($0.6 million after-tax). Revenues and operating income recorded in
1999 for the drill bit operations were $6.1 million and $0.1 million,
respectively.
7
<PAGE> 9
On July 8, 1999, the Company acquired the assets of CE Drilling Products, Inc.
for approximately $65 million in cash, financed primarily by borrowing $57
million under its revolving credit facility. This business involves the
manufacture, sale and service of drilling machinery and related parts. The
transaction has been accounted for under the purchase method of accounting.
Revenues for the Products and Technology segment decreased by $138.4 million
(66%) in the third quarter of 1999 as compared to the same quarter in 1998 due
primarily to reduced sales of major capital equipment and drilling replacement
parts. Sales of new mud pumps, drawworks, SCR systems, power swivels and rigs
were $5.9 million in the third quarter of 1999 compared to $99.8 million in the
same period in 1998. Operating income decreased by $35.4 million in the third
quarter compared to the same quarter in 1998 due principally to the lower
revenue volume partially offset by a $9.0 million reduction in selling and
administrative expenses resulting from cost reduction initiatives completed in
early 1999.
Products and Technology revenues in the first nine months of 1999 decreased
$290.7 million as compared to 1998 due primarily to the reduced demand for new
capital equipment, drilling replacement parts and downhole motor and tool sales.
Operating income decreased by $83.3 million in the first nine months of 1999
compared to 1998 as a result of the decline in revenues offset in part by a
$13.4 million reduction in selling and administrative expenses.
Backlog of the Products and Technology capital products was $49 million at
September 30, 1999, up from $26 million at June 30, 1999, but down from $159
million at September 30, 1998. Substantially all of the current backlog is
expected to be shipped by the end of March 2000.
Distribution Services
Distribution Services revenues result primarily from the sale of maintenance,
repair and operating supplies ("MRO") from the Company's network of distribution
service centers and, prior to July 1999, from the sale of well casing and
production tubing. These products are purchased from numerous manufacturers and
vendors, including the Company's Products and Technology segment. The Company
sold its tubular product line in June 1999 for approximately $15 million,
generating a pre-tax loss of $0.9 million ($0.5 million after-tax). Revenues and
operating loss recorded in 1999 for the tubular operations were $23.6 million
and $0.6 million, respectively.
On July 1, 1999, the Company purchased 100 % of the outstanding stock of Dupre'
Supply Company and Dupre' International Inc. in exchange for 1,920,000 shares of
National Oilwell common stock. These companies are leading suppliers of pipe,
fittings, valves and valve automation services and complement the existing
operations of the Distribution Services segment. This transaction has been
accounted for under the pooling-of-interests method of accounting and,
accordingly, historical financial statements have been restated.
Distribution Services revenues during the third quarter of 1999 fell short of
the comparable 1998 period by $37.3 million. This 27% decrease reflects the
reduced demand for MRO products precipitated primarily by lower oil prices and
the sale of the tubular product line in the second quarter of 1999. Revenues in
the tubular product line accounted for $28 million of this decline with MRO
sales in the United States comprising the majority of the remaining shortfall,
offset partially by a $13 million increase in Canadian revenues. Operating
income in the third quarter of 1999 was $2.5 million below the third quarter of
1998. A $5.6 million reduction in base margin due to the decline in revenues was
partially offset by $3.1 million in reduced operating expenses.
8
<PAGE> 10
Revenues for the Distribution Services segment fell $174.2 million in the first
nine months of 1999 when compared to the prior year, reflecting the significant
decrease in oil prices between the periods. Despite a revenue growth in Canada
of approximately $28 million, sales in the United States showed a $187 million
decline including a tubular business reduction of $103 million. Operating income
was $18.2 million lower in the first nine months of 1999 when compared to 1998
and is attributable to the lower revenue levels offset, in part, by reduced
operating costs of approximately $9 million.
Corporate
Corporate costs during the third quarter of 1999 of $1.3 million and the first
nine months of 1999 of $4.1 million were lower than the same periods of the
prior year due to cost reduction initiatives completed in early 1999.
Interest Expense
Interest expense decreased during the three months ending September 30, 1999
when compared to the same period in 1998 due to reduced debt levels. For the
first nine months of 1999, interest expense increased as 6.875% unsecured senior
notes that were issued to fund the acquisition of Phoenix Energy Products
Holdings, Inc. in June 1998 were outstanding for the full period.
LIQUIDITY AND CAPITAL RESOURCES
At September 30, 1999, the Company had working capital of $297 million, a
decrease of $67 million from December 31, 1998. Significant declines in accounts
receivable and inventory of $129 million and $21 million were offset by a
reduction in accounts payable of $42 million, customer prepayments on orders of
$20 million and accrued liabilities of $14 million.
Total capital expenditures were $12 million during the first nine months of 1999
compared to $16.9 million in the first nine months of 1998. Enhancements to
information and inventory control systems represent a large portion of these
capital expenditures. The Company has sufficient existing manufacturing capacity
to meet currently anticipated demand through 2000 for its products and services.
The Company has a five-year unsecured $125 million revolving credit facility,
which is available for acquisitions and general corporate purposes. The credit
facility provides for interest at prime or LIBOR plus 0.625%, subject to
adjustment based on the Company's Capitalization Ratio, as defined. The credit
facility contains financial covenants and ratios regarding minimum tangible net
worth, maximum debt to capital and minimum interest coverage. Availability under
this facility was $69 million at September 30, 1999, after consideration of $13
million in outstanding letters of credit.
The Company believes that cash generated from operations and amounts available
under the credit facility will be sufficient to fund operations, working capital
needs, capital expenditure requirements and financing obligations.
The Company intends to pursue acquisition candidates, but the timing, size or
success of any acquisition effort and the related potential capital commitments
cannot be predicted. The Company expects to fund future acquisitions primarily
with cash flow from operations and borrowings, including the unborrowed portion
of the credit facility or new debt issuances or from the issuance of equity
securities. There can be no assurance that additional financing for acquisitions
will be available at terms acceptable to the Company.
9
<PAGE> 11
YEAR 2000
The year 2000 issue is the result of computer programs having been written using
two digits rather than four to define the applicable year. Any computer programs
that have date-sensitive software may recognize a date using "00" as the year
1900 rather than the year 2000. This could result in a system failure or
miscalculations causing disruptions of operations, including, among other
things, a temporary inability to process transactions, send invoices, or engage
in similar normal business activities.
On September 1, 1999, the Company's Distribution Services segment completed the
initial installation of SAP, its principal business system. Virtually all of its
North American operating outlets are now conducting business on this Year 2000
compliant system. Costs incurred during 1998 and 1999 to reach this milestone
approximated $17 million. The Company's Products & Technology segment's primary
operating system is Y2K compliant. In addition, the Company has achieved year
2000 date conversion compliance in all of its other critical systems, including
networks and infrastructure. Personal computers that were not Y2K compliant have
been replaced or upgraded.
Excluding the cost to install the SAP operating system, the total cost of the
year 2000 readiness approximated $1.0 million. The Year 2000 review covered
internal computer systems and process control systems, as well as embedded
systems in products sold by the Company. In addition, the Company has
communicated with its significant suppliers, customers and business partners and
has not identified any significant Year 2000 concerns.
Management believes that with its installation of new systems, conversion to new
software and modifications to existing software, the year 2000 issue will pose
no significant operational problems for National Oilwell. While there can be no
assurance that the Company has identified every possible problem, none are
anticipated that could have an adverse effect on the Company's financial
position.
FORWARD-LOOKING STATEMENTS
This document, other than historical financial information, contains
forward-looking statements that involve risks and uncertainties. Such statements
relate to the Company's sales of capital equipment, backlog, capacity, liquidity
and capital resources, plans for acquisitions and any related financings and the
impact of Year 2000. Readers are referred to documents filed by the Company with
the Securities and Exchange Commission which identify significant risk factors
which could cause actual results to differ from those contained in the
forward-looking statements, including "Risk Factors" at Item 1 of the Annual
Report on Form 10-K. Given these uncertainties, current or prospective investors
are cautioned not to place undue reliance on any such forward-looking
statements. The Company disclaims any obligation or intent to update any such
factors or forward-looking statements to reflect future events or developments.
10
<PAGE> 12
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
27.1 Financial Data Schedule
(a) Reports on Form 8-K
A Form 8-K was filed on August 24, 1999 to restate financial data for
the three years ended December 31, 1998 to combine Dupre' results
pursuant to pooling-of-interests accounting.
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.
Date: November 12, 1999 /s/ Steven W. Krablin
---------------------- ------------------------
Steven W. Krablin
Principal Financial and Accounting Officer
and Duly Authorized Signatory
11
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 15,579
<SECURITIES> 0
<RECEIVABLES> 178,331
<ALLOWANCES> 5,482
<INVENTORY> 232,554
<CURRENT-ASSETS> 437,249
<PP&E> 172,537
<DEPRECIATION> 64,216
<TOTAL-ASSETS> 741,717
<CURRENT-LIABILITIES> 140,247
<BONDS> 194,608
0
0
<COMMON> 583
<OTHER-SE> 391,325
<TOTAL-LIABILITY-AND-EQUITY> 741,717
<SALES> 546,932
<TOTAL-REVENUES> 546,932
<CGS> 442,339
<TOTAL-COSTS> 442,339
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 2,482
<INTEREST-EXPENSE> 11,429
<INCOME-PRETAX> 399
<INCOME-TAX> 1,379
<INCOME-CONTINUING> (980)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (980)
<EPS-BASIC> (0.02)
<EPS-DILUTED> (0.02)
</TABLE>
