SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
_________________________________
QUARTERLY REPORT PURSUANT TO SECTION 12 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For quarter ended September 30, 1998Commission File Number: 333-19257
MOTORS AND GEARS, INC.
(Exact name of registrant as specified in charter)
Delaware 36-4109641
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
ArborLake Centre, Suite 550 60015
1751 Lake Cook Road (Zip Code)
Deerfield, Illinois
(Address of Principal Executive Offices)
Registrant's telephone number, including area code:
(847) 945-5591
Former name, former address and former fiscal year, if changed since last
report: Not applicable.
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 twelve (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 ninety (90) days.
Yes X No
The aggregate market value of voting stock held by non-affiliates of the
Registrant is not determinable as such shares were privately place and there
is currently no public market for such shares.
The number of shares outstanding of Registrant's Common Stock as of
November 13, 1998: 100,000.
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PAGE 2
MOTORS AND GEARS, INC.
INDEX
PART I. FINANCIAL INFORMATION PAGE NO.
Item 1. Financial Statements (Unaudited) 3
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 10
Item 3. Quantitative and Qualitative Disclosures About
Market Risk 13
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 14
Item 2. Changes in Securities 14
Item 3. Defaults upon Senior Securities 14
Item 4. Submission of Matters to a Vote of Securities
Holders 14
Item 5. Other Information 14
Item 6. Exhibits and Reports on Form 8-k 14
Signatures 15
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PAGE 3
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (Unaudited)
PAGE NO.
Condensed Consolidated Balance Sheets at September 30, 1998,
and December 31, 1997 4
Condensed Consolidated Statements of Income for the
three and nine months ended September 30, 1998 and 1997 5
Condensed Consolidated Statements of Cash Flows for the nine
months ended September 30, 1998 and 1997 6
Notes to Condensed Consolidated Financial Statements 7-9
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PAGE 4
MOTORS AND GEARS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(ALL DOLLAR AMOUNTS IN THOUSANDS)
September 30, December 31,
1998 1997
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 6,489 $ 28,880
Accounts receivable, net 54,789 40,679
Inventories 42,589 31,665
Prepaid expenses and other current assets 1,517 1,300
Total Current Assets 105,384 102,524
Property, plant, and equipment, net 19,491 15,201
Goodwill, net 230,386 195,424
Deferred financing costs, net 14,534 15,877
Deferred income taxes 3,825 3,825
Other assets, net 2,720 2,293
Total Assets $376,340 $335,144
LIABILITIES AND SHAREHOLDER'S EQUITY
Current Liabilities:
Notes payable $ 54 $ 2,009
Accounts payable 24,618 17,424
Accrued interest payable 11,722 4,232
Accrued expenses and other 10,018 12,297
Due to affiliated company 2,373 1,488
Total Current Liabilities 48,785 37,450
Long-Term debt 308,806 283,613
Deferred income taxes 4,759 3,880
Other non-current liabilities 2,798 2,649
Shareholder's Equity:
Common Stock 1 1
Additional paid-in-capital 50,005 50,005
Accumulated other comprehensive income (loss) (1,888) (16)
Accumulated deficit (36,926) (42,438)
Total Shareholder's Equity 11,192 7,552
Total Liabilities and Shareholder's Equity $376,340 $335,144
See accompanying notes to condensed consolidated financial statements.
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PAGE 5
MOTORS AND GEARS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(ALL DOLLAR AMOUNTS IN THOUSANDS)
Three Months Ended Nine Months Ended
September 30, September 30,
1998 1997 1998 1997
Net Sales $ 78,038 $ 39,861 $208,304 $106,379
Cost of Sales, excluding
depreciation 50,658 25,573 135,310 68,349
Selling, general and
administrative expenses 9,943 3,294 26,711 8,226
Depreciation 1,513 1,063 4,074 3,003
Amortization of goodwill
and other intangibles 2,220 1,281 6,043 3,256
Management fees and other 890 888 2,323 1,567
Operating Income 12,814 7,762 33,843 21,978
Other (income) and expense:
Interest expense 8,461 5,809 24,521 15,950
Interest income (66) (35) (688) (354)
Total other expense 8,395 5,774 23,833 15,596
Income before income taxes 4,419 1,988 10,010 6,382
Provision for income taxes 1,970 866 4,498 2,805
Net income $ 2,449 $ 1,122 $ 5,512 $ 3,577
See accompanying notes to condensed consolidated financial statements.
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PAGE 6
MOTORS AND GEARS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(ALL DOLLAR AMOUNTS IN THOUSANDS)
Nine Months Ended
September 30 ,
1998 1997
Cash flows from operating activities:
Net income $ 5,512 $ 3,577
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 11,089 7,046
Provision for deferred income taxes 879 803
Changes in operating assets and liabilities net
of effects from acquisitions:
Increase in current assets (13,127) (2,527)
Increase in current liabilities 9,381 3,401
Increase in non-current assets & liabilities 24 (274)
Increase in payables to affiliated company 885 1,064
Net cash provided by operating activities 14,643 13,090
Cash flows from investing activities:
Capital expenditures, net (3,777) (739)
Acquisitions of subsidiaries (55,906) (50,950)
Cash acquired in acquisition of subsidiaries 360 890
Net cash used in investing activities (59,323) (50,799)
Cash flows from financing activities:
Proceeds from revolving credit facilities 40,000 50,000
Repayment of long-term debt (2,230) (17)
Repayment of revolving credit facilities (15,000) (16,000)
Other 60 70
Net cash provided by financing activities 22,830 34,053
Effect of exchange rate changes on cash (541) (1,251)
Net decrease in cash and cash equivalents (22,391) (4,907)
Cash and cash equivalents at beginning of period 28,880 10,011
Cash and cash equivalents at end of period $ 6,489 $ 5,104
See accompanying notes to condensed consolidated financial statements.
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PAGE 7
MOTORS AND GEARS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(ALL DOLLAR AMOUNTS IN THOUSANDS)
A. Organization
The unaudited condensed consolidated financial statements, which reflect all
adjustments that management believes necessary to present fairly the results
of interim operations and are of a normal recurring nature, should be read in
conjunction with the Company's consolidated financial statements for the year
ended December 31, 1997, included in the Company's annual report on Form
10-K. The Company conducts its operations exclusively through its
subsidiaries. Results of operations for the interim periods are not
necessarily indicative of annual results of operations.
B. Significant Accounting Policies - Consolidation Principles
The condensed consolidated financial statements include the accounts of Motors
and Gears, Inc. and its subsidiaries. Material intercompany transactions and
balances are eliminated in consolidation. Operating results of a subsidiary
in Italy are included for periods ending two months prior to the Company's
year end and interim periods to ensure timely preparation of the condensed
consolidated financial statements.
C. Inventories
Inventories are summarized as follows:
September 30, December 31,
1998 1997
Raw materials $29,689 $21,639
Work in process 8,534 7,375
Finished goods 4,366 2,651
$42,589 $31,665
D. Acquisition of Subsidiaries
On June 12, 1997, the Company purchased all of the common stock of the FIR
Group Companies, consisting of CIME S.p.A., SELIN, S.p.A. and FIR S.p.A.
(collectively "FIR") for $51,026. The purchase price, including costs
incurred directly related to the transaction, was allocated to working capital
of $16,562; property and equipment of $4,918; other long-term assets and
liabilities of ($3,442); and resulted in an excess purchase price over net
identifiable assets of $32,988. FIR is a manufacturer of electric motors and
pumps for niche applications such as pumps for commercial dishwashers, motors
for industrial sewing machines and motors for industrial fans and
ventilators.
On October 27, 1997, the Company acquired all of the outstanding stock of E.D.
and C. Company, Inc. ("ED&C") for $16,000 in cash and a $3,850 Subordinated
Junior Seller Note. The purchase price, including costs incurred directly
related to the transaction, was allocated to working capital of $3,514;
property
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PAGE 8
MOTORS AND GEARS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(ALL DOLLAR AMOUNTS IN THOUSANDS)
and equipment of $81; covenants not to compete of $120; and resulted in an
excess purchase price over net identifiable assets of $16,135. ED&C is a
full-service electrical engineering company which designs, engineers and
manufactures electrical control systems and panels for material handling
systems and other like applications. ED&C provides comprehensive design,
build and support services to produce electronic control panels which regulate
the speed and movement of conveyor systems used in a variety of automotive
plants and other industrial applications.
On December 18, 1997, the Company purchased all of the stock of Motion Control
Engineering, Inc. ("Motion Control") for $53,925. The purchase price,
including costs incurred directly related to the transaction, was allocated to
working capital of $10,071; property and equipment of $1,428; covenants not to
compete of $1,005; other long-term assets and liabilities of ($12); and
resulted in an excess purchase price over net identifiable assets of $41,433.
The Company also has a contingent purchase price agreement relating to the
acquisition of Motion Control. The contingent purchase price is dependent
upon the acquired entity's results of operations exceeding certain targeted
levels substantially above the historical experience of Motion Control at the
time of acquisition. Motion Control manufactures electronic motion control
products for elevator markets, primarily the elevator modernization market.
On May 15, 1998, the Company acquired all of the outstanding stock of Advanced
D.C. Motors, Inc. and its affiliated corporations (collectively "ADC") for
$55,500. The purchase price, including costs incurred directly related to the
transaction, was allocated to working capital of $9,345; property and
equipment of $4,088; covenants not to compete of $662; other long-term assets
and liabilities of $54; and resulted in an excess purchase price over net
identifiable assets of $41,351. The Company also has a contingent purchase
price agreement of up to $5,600 relating to the acquisition of ADC. The
contingent purchase price is dependent upon the acquired entity's results of
operations exceeding certain targeted levels substantially above the
historical experience of ADC at the time of acquisition. ADC designs and
manufactures special purpose, custom designed motors for use in electric lift
trucks, power sweepers, electric utility vehicles, golf carts, electric boats,
and other niche products. ADC also designs and manufactures its own
production equipment as well as electric motor components known as
commutators.
Unaudited proforma information with respect to the Company as if the 1997 and
1998 acquisitions had occurred on January 1, 1997 is as follows:
Nine Months Ended
September 30,
1998 1997
(Unaudited)
Net sales $226,073 $196,503
Income before income taxes 13,000 9,009
Net income $ 7,156 $ 4,955
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PAGE 9
MOTORS AND GEARS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(ALL DOLLAR AMOUNTS IN THOUSANDS)
E. Comprehensive Income
As of January 1, 1998, the Company adopted the Financial Accounting Standards
Board's Statement of Financial Accounting Standards No. 130, "Reporting
Comprehensive Income". Statement 130 establishes new rules for the reporting
and display of comprehensive income and its components; however, the adoption
of this Statement had no impact on the Company's net income or shareholders'
equity. The Company's only comprehensive income relates to foreign currency
translation. Statement 130 requires foreign currency translation adjustments,
which prior to adoption were reported separately in shareholders' equity, to
be included in other comprehensive income. Certain amounts in prior year
financial statements have been reclassified to conform to the requirements of
Statement 130.
Total comprehensive income/(loss) was $2,968 and ($129) for the three months
ended September 30, 1998 and 1997, respectively, and $3,640 and $2,326 for the
nine months ended September 30, 1998 and 1997, respectively.
F. Business Segment Information
See Part 1 "Financial Information" - Item 2 "Management's Discussion and
Analysis of Financial Condition and Results of Operations" for the Company's
business
segment disclosures. There have been no changes from the Company's December
31, 1997 consolidated financial statements with respect to segmentation or
the measurement of segment profit with the exception of the acquisition of
ADC which is included in the motors segment.
G. Foreign Exchange Instruments and Risk Management
The Company entered into foreign currency forward exchange contracts to hedge tr
ansactions and firm commitments that are denominated in foreign currencies
(principally the Italian Lira) and not to engage in currency speculation. The
Company primarily utilizes forward exchange contracts with a duration of one
year or less. Gains or losses on hedges of transaction exposures are included
in income in the period in which exchange rates change. Gains and losses on
contracts which hedge specific foreign currency denominated commitments are
deferred and recognized on the same basis as the transactions underlying the
commitments.
Forward exchange contracts generally require the Company to exchange U.S.
dollars for foreign currencies at maturity, at rates that are agreed upon at
inception of the contracts. If the counterparties to the exchange contracts
(primarily highly-rated financial institutions) do not fulfill their
obligations to deliver the contracted currencies, the Company could be at risk
for any currency related fluctuation.
The Company has $1,357 notional amount of foreign currency forward exchange
contracts outstanding at September 30, 1998 ($0 at December 31, 1997).
<PAGE>
PAGE 10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
(UNAUDITED)
(ALL DOLLAR AMOUNTS IN THOUSANDS)
Summary financial information included in the financial statements of the
Company is as follows:
Three Months Ended Nine Months Ended
September 30, September 30,
1998 1997 1998 1997
Net sales (1) $78,038 $39,861 $208,304 $106,379
Gross profit (1)
(excluding depreciation) 27,380 14,288 72,994 38,030
EBITDA (1)(2) 16,547 10,106 43,960 28,237
Operating income (1) 12,814 7,762 33,843 21,978
Interest expense $ 8,461 $ 5,809 $ 24,521 $ 15,950
Gross margin (excluding
depreciation) (3) 35.1% 35.8% 35.0% 35.7%
EBITDA margin (3) 21.2 25.4 21.1 26.5
Operating margin (3) 16.4 19.5 16.2 20.7
(1) With the acquisition of ED&C and Motion Control during 1997, the results
of operations for the three and nine months ended September 30, 1998 include
operations for both the motors and controls segments. The controls segment
accounted for $16,152 and $47,679 of net sales, $6,377 and $18,333 of gross
profit (excluding depreciation), $2,680 and $7,940, of EBITDA (earnings before
interest, income taxes, depreciation and amortization) and $2,050 and $6,086
of operating income for the three and nine months ended September 30, 1998,
respectively. Note that the segment analysis does not include unallocated
corporate overhead and management fees in the EBITDA and operating income
calculations.
(2) EBITDA is included herein because management believes that certain
investors find it to be a useful tool for measuring the ability of the Company
to service its debt.
(3) All margins are calculated as a percentage of net sales.
Consolidated Results of Operations
Net sales for the third quarter and first nine months of 1998 increased 96%
($38.2 million) and 96% ($101.9 million), respectively, as compared with the
same periods in the prior year. The strong sales growth was primarily driven
by the three acquisitions in the latter part of 1997 and the acquisition in
the second quarter of 1998. The Company acquired FIR in June of 1997, ED&C in
October of 1997, Motion Control in December of 1997 and ADC in May of 1998.
These acquisitions accounted for $32.7 million (86%) and $90.7 million (89%)
of the sales growth in the third quarter and first nine months of 1998,
respectively, while the remaining growth was the result of organic sales
growth. Net sales of sub-fractional motors for the third quarter and first
nine months increased 23% and 13% over the same periods in the prior year,
primarily attributed to continued strength in the vending machine and
appliance markets. Excluding the 1997 and 1998 acquisitions, net sales of
fractional/integral motors increased 3% and 7% for the three and nine months
ended September 30, 1998 over the same periods of 1997, driven by stronger
sales in the floor care and elevator markets.
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PAGE 11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Operating income for the third quarter and first nine months of 1998 increased
65% ($5.1 million) and 54% ($11.9 million), respectively. The increase in
operating income was primarily the result of the increased sales described
above. Gross margins decreased slightly over both periods as compared to 1997
attributed mainly to a decrease in the gross margins earned on
fractional/integral motor sales. Increased operating income resulting from
the increased sales described above was partially offset by increased
corporate expenses. The decrease in operating income margins was primarily
the result of the 1997 acquisitions, which operate at slightly lower operating
margins than the rest of the Company, and the increase in corporate expenses.
Interest expense increased in the third quarter and first nine months of 1998
over the same periods of 1997, reflecting higher debt levels relating to the
financing of new acquisitions through the Company's December 1997 $100.0
million debt offering and the draw down of $40.0 million on the Company's
revolving credit facility in May of 1998.
Liquidity and Capital Resources
In general, the Company requires liquidity for working capital, capital
expenditures, interest, taxes, debt repayment and its acquisition strategy.
Of primary importance are the Company's working capital requirements, which
increase whenever the Company experiences strong incremental demand or
geographical expansion. The Company expects to satisfy its liquidity
requirements through a combination of funds generated from operating
activities and the funds available under its revolving line-of-credit
agreement.
Operating activities. Net cash provided by operating activities for the nine
months ended September 30, 1998 was $14.6 million, compared to $13.1 million
during the same period in 1997. The increase in cash provided by operating
activities was the result of improved operating results, partially offset by
an increase in working capital requirements.
Investing activities. Capital expenditures of $3.8 million for the first nine
months of 1998 were $3.0 million greater than the comparable period in 1997.
In addition, the cost of the ADC acquisition in May of 1998 was approximately
$5.0 million greater than the cost of the FIR acquisition in June of 1997.
The Company expects its capital investment in 1998 to be greater than the 1997
spending level as a result of late 1997 acquisitions and the acquisition of
ADC in the second quarter of 1998. The Company plans to fund future
acquisitions through its revolving line-of-credit agreement and excess
operating cash flow.
Financing activities. The Company's annual cash interest expense on the
Senior Notes, which are due 2006, will be approximately $29.0 million.
Interest on the Senior Notes is payable semi-annually on May 15 and November
15 of each year. Interest paid on the Junior Seller Notes was $0.5 million in
the first nine months of 1998.
The Company is party to a Credit Agreement under which the Company is able to
borrow up to approximately $75.0 million to fund acquisitions and provide
working capital and for other general corporate purposes. The Credit
Agreement provides
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PAGE 12
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
for a revolving line of credit of $75.0 million over a term of five years.
Obligations under the Credit Agreement are guaranteed by M&G Industries'
subsidiaries, and secured by pledges of the stock of M&G Industries'
subsidiaries and liens in respect of certain assets of M&G Industries and its
subsidiaries.
As of November 13, 1998, the Company has approximately $53.0 million of
available funds under the Credit Agreement. In addition, under the terms of
the Series D Notes, the Company is able to increase the credit facility to
approximately $115.0 million.
The Company expects its principal sources of liquidity to be from its
operating activities and funding from the revolving line-of-credit agreement.
The Company further expects that these sources will enable it to meet its
long-term cash requirements for working capital, capital expenditures,
interest, taxes, and debt repayment for at least the next 12 months.
Year 2000 Disclosure
Introduction. The Year 2000 issue is the result of computer programs being
written using two digits rather than four to define the applicable year. Any
of the Company's computer programs or hardware that have date-sensitive
software or embedded chips 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.
State of Readiness. Based on recent assessments, the Company determined that
it will be required to modify or replace significant portions of its software
and certain hardware so that those systems will properly utilize dates beyond
December 31, 1999. The Company presently believes that with modifications or
replacements of existing software and certain hardware, the Year 2000 issue
can be mitigated. However, if such modifications and replacements are not
made, or are not completed timely, the Year 2000 issue could have a material
impact on the operations of the Company.
The Company's plan to resolve the Year 2000 issue involves the following four
phases: assessment, remediation, testing and implementation. The Company is
in the process of assessing all systems that could be significantly affected
by the Year 2000 issue. Preliminary results of this assessment indicated that
some of the Company's significant information technology systems could be
affected, particularly the general ledger, billing, and inventory systems.
The preliminary assessment also indicated that software and hardware (embedded
chips) used in production and manufacturing systems (hereafter also referred
to as operating equipment) may also be at risk. In addition, based on a
review of its product lines, the Company has determined that most of the
products it has sold and will continue to sell do not require remediation to
be Year 2000 issue compliant. Accordingly, the Company does not believe that
the Year 2000 issue presents a material exposure as it relates to the
Company's products. In addition, the Company is in the process of gathering
information about the Year 2000 compliance status of its significant suppliers
and continues to monitor their compliance.
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PAGE 13
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
For its information technology exposures, to date the Company has completed a
majority of the remediation phase and expects to complete software
reprogramming and replacement no later than June 30, 1999. Once software is
reprogrammed or replaced for a system, the Company begins testing and
implementation. The testing and implementation phases for all significant
systems are expected to be completed by September 30, 1999. The four phases
of the Company's Year 2000 program in relation to operating equipment is
on-going and expected to be completed by December 31, 1999.
Cost. The Company will utilize both internal and external resources to
reprogram or replace, test, and implement the software and operating equipment
for Year 2000 modifications. The total cost of the Year 2000 project is
estimated at $2.5 million and is being funded through operating cash flows and
capital leases. To date, the Company has incurred approximately $1.0 million
related to all phases of the Year 2000 project. The majority of these costs
have been capitalized.
Risks. Management of the Company believes it has an effective program in
place to resolve the Year 2000 issue in a timely manner. As noted above, the
Company has not yet completed all necessary phases of the Year 2000 program.
In the event that the Company does not complete any additional phases, the
Company could be materially adversely affected. In addition, disruptions in
the economy generally resulting from the Year 2000 issue could also materially
adversely affect the Company. The amount of potential liability and lost
revenue cannot be reasonably estimated at this time.
Contingency Plans. The Company's contingency plans, in the event it does not
complete all phases of the Year 2000 program, are incomplete at this time.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK
Not applicable.
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PAGE 14
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
1) 27. EDGAR Financial Data Schedule
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PAGE 15
SIGNATURES
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.
MOTORS AND GEARS, INC.
By: /s/ Norman R. Bates
Norman R. Bates
Chief Financial Officer
November 13, 1998
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<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1998
<CASH> 6,489
<SECURITIES> 0
<RECEIVABLES> 55,787
<ALLOWANCES> (998)
<INVENTORY> 42,589
<CURRENT-ASSETS> 105,384
<PP&E> 41,277
<DEPRECIATION> (21,786)
<TOTAL-ASSETS> 376,340
<CURRENT-LIABILITIES> 48,785
<BONDS> 274,125
0
0
<COMMON> 1
<OTHER-SE> 11,191
<TOTAL-LIABILITY-AND-EQUITY> 376,340
<SALES> 208,304
<TOTAL-REVENUES> 208,304
<CGS> 135,310
<TOTAL-COSTS> 135,310
<OTHER-EXPENSES> 39,151
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 24,521
<INCOME-PRETAX> 10,010
<INCOME-TAX> 4,498
<INCOME-CONTINUING> 5,512
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