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 September 30, 1995
OR
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 1-4033
VULCAN MATERIALS COMPANY
(Exact name of registrant as specified in its charter)
New Jersey 63-0366371
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Metroplex Drive, Birmingham, Alabama 35209
(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code (205) 877-3000
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
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date:
Shares outstanding
Class at September 30, 1995
Common Stock, $1 Par Value 35,188,621
VULCAN MATERIALS COMPANY
FORM 10-Q
QUARTER ENDED SEPTEMBER 30, 1995
Contents
Page No.
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets 1
Condensed Consolidated Statements of Earnings 2
Condensed Consolidated Statements of Cash Flows 3
Notes to Condensed Consolidated Financial Statements 4
Exhibit 11 - Computation of Earnings Per Share 5
Exhibit 12 - Computation of Ratio of Earnings
to Fixed Charges 6
Item 2. Management's Discussion and Analysis of Results
of Operations and Financial Condition 7
PART II OTHER INFORMATION
Item 1. Legal Proceedings 15
Item 6. Exhibits and Reports on Form 8-K 16
SIGNATURES 17
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
VULCAN MATERIALS COMPANY AND SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED BALANCE SHEETS*
(Amounts in thousands)
Sept. 30, Dec. 31, Sept. 30,
Assets 1995 1994 1994
<S> <C> <C> <C>
Current assets
Cash and cash equivalents.............................. $ 9,319 $ 7,717 $ 8,502
Accounts and notes receivable, less allowance for
doubtful accounts: Sept. 30, 1995, $8,712; Dec. 31,
1994, $8,244; Sept. 30, 1994, $8,139................. 235,808 182,128 211,618
Inventories:
Finished products.................................... 82,678 77,721 75,250
Raw materials........................................ 9,974 9,248 8,397
Products in process.................................. 1,089 623 1,019
Operating supplies and other......................... 25,989 24,889 24,977
Total inventories............................... 119,730 112,481 109,643
Deferred income taxes.................................. 26,490 29,074 24,478
Prepaid expenses....................................... 9,693 5,398 12,866
Total current assets............................ 401,040 336,798 367,107
Investments and long-term receivables.................... 61,660 58,138 57,590
Property, plant and equipment, at cost less accumulated
depreciation, depletion and amortization:
Sept. 30 1995, $1,164,734; Dec. 31, 1994,
$1,107,132; Sept. 30, 1994, $1,099,928................. 706,022 701,757 717,019
Deferred charges and other assets........................ 91,458 84,451 74,104
Total........................................... $1,260,180 $1,181,144 $1,215,820
Liabilities and Shareholders' Equity
Current liabilities
Current maturities of long-term obligations............ $ 5,716 $ 4,687 $ 4,684
Notes payable.......................................... 80,274 42,779 76,843
Trade payables and accruals............................ 101,307 102,394 96,244
Other current liabilities.............................. 79,287 61,488 58,329
Total current liabilities....................... 266,584 211,348 236,100
Long-term obligations.................................... 91,778 97,380 97,539
Deferred income taxes.................................... 84,897 82,507 77,672
Other noncurrent liabilities............................. 63,217 58,280 63,118
Other commitments and contingent liabilities ...........
Shareholders' equity..................................... 753,704 731,629 741,390
Total........................................... $1,260,180 $1,181,144 $1,215,820
<FN>
*Balance sheets as of September 30 are unaudited.
The accompanying Notes to Condensed Consolidated Financial
Statements are an integral part of these statements.
</TABLE>
<TABLE>
<CAPTION>
VULCAN MATERIALS COMPANY AND SUBSIDIARY COMPANIE
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Amounts and shares in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30* September 30*
1995 1994 1995 1994
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Net sales....................................$421,981 $360,359 $1,099,188 $903,956
Cost of goods sold............................288,114 269,950 793,348 715,188
Gross profit on sales.........................133,867 90,409 305,840 188,768
Selling, administrative and general expenses.. 39,578 33,753 115,760 90,225
Other operating costs......................... 1,046 1,771 3,287 4,308
Other income, net............................. 2,562 3,051 12,900 9,916
Earnings before interest
expense and income taxes.................... 95,805 57,936 199,693 104,151
Interest expense.............................. 3,054 2,804 8,650 7,219
Earnings before income taxes.................. 92,751 55,132 191,043 96,932
Provision for income taxes.................... 33,603 17,532 68,202 30,824
Net earnings ................................$ 59,148 $ 37,600 $ 122,841 $ 66,108
Primary and fully diluted earnings per
share of common stock....................... $1.64 $1.02 $3.40 $1.80
Average common and common equivalent
shares outstanding**........................ 35,984 36,763 36,087 36,750
Cash dividends per share of common stock...... $0.365 $0.33 $1.095 $0.99
Depreciation, depletion and amortization
deducted above..............................$28,184 $27,055 $82,302 $79,691
Effective tax rate............................ 36.2% 31.8% 35.7% 31.8%
<FN>
* Unaudited
** Primary and fully diluted earnings per share of common stock are
computed by dividing net earnings by the weighted average number
of common shares and common share equivalents outstanding during
the period. Common share equivalents represent the number of shares
contingently issuable under long-range performance share plans and
the stock plan for non-employee directors. Refer to Exhibit 11 for
computation.
The accompanying Notes to Condensed Consolidated Financial
Statements are an integral part of these statements.
</TABLE>
<TABLE>
<CAPTION>
VULCAN MATERIALS COMPANY AND SUBSIDIARY COMPANIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
Nine Months Ended
September 30*
1995 1994
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Operations
Net earnings ............................................... $122,841 $ 66,108
Adjustments to reconcile net earnings to net cash
provided by continuing operations:
Depreciation, depletion and amortization................ 82,302 79,691
Increase in assets before effects of
business acquisitions................................. (57,994) (50,897)
Increase in liabilities before effects of
business acquisitions................................. 2,918 15,646
Other, net.............................................. (1,580) 3,832
Net cash provided by continuing operations........... 148,487 114,380
Net cash used for discontinued operations................... (725) (660)
Net cash provided by operations...................... 147,762 113,720
Investing Activities
Purchases of property, plant and equipment.................. (77,499) (76,313)
Payment for business acquisitions (net of acquired cash).... (21,027) (78,630)
Proceeds from sale of property, plant and equipment......... 9,493 6,721
Investment in nonconsolidated companies..................... (1,512) (1,779)
Withdrawal of earnings from nonconsolidated companies....... 250 -
Net cash used for investing activities............... (90,295) (150,001)
Financing Activities
Net borrowings - commercial paper and bank lines of credit.. 37,495 76,843
Payment of short-term debt.................................. (4,541) (1,668)
Payment of long-term debt................................... (32) (8,233)
Purchases of common stock................................... (49,700) -
Dividends paid.............................................. (39,087) (36,155)
Net cash provided by (used for) financing activities. (55,865) 30,787
Net increase (decrease) in cash and cash equivalents........ 1,602 (5,494)
Cash and cash equivalents at beginning of year.............. 7,717 13,996
Cash and cash equivalents at end of period.................. $ 9,319 $ 8,502
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest (net of amount capitalized)..................$ 6,750 $ 5,297
Income taxes.......................................... 68,013 26,996
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING
AND FINANCING ACTIVITIES:
Liabilities assumed in business acquisition.............$ 1,382 $ 16,041
Fair value of stock issued in business acquisition...... - 7,476
<FN>
*Unaudited
The accompanying Notes to Condensed Consolidated Financial
Statements are an integral part of these statements.
</TABLE>
VULCAN MATERIALS COMPANY AND SUBSIDIARY COMPANIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
The accompanying condensed financial statements have been prepared in
compliance with Form 10-Q instructions and thus do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of
management, the statements reflect all adjustments, including those of a
normal recurring nature, necessary to present fairly the results of the
reported interim periods. The statements should be read in conjunction
with the summary of accounting policies and notes to financial statements
included in the Company's latest annual report on Form 10-K. The
reporting of segment data required by Statement of Financial Accounting
Standards No. 14, Financial Reporting for Segments of a Business
Enterprise, is confined to complete financial statements as provided in
the Company's Form 10-K and annual report to shareholders.
2. Effective Tax Rate
In accordance with generally accepted accounting principles, it is the
Company's practice at the end of each interim reporting period to make a
best estimate of the effective tax rate expected to be applicable for the
full fiscal year. The rate so determined is used in providing for income
taxes on a current year-to-date basis.
<TABLE>
<CAPTION>
EXHIBIT 11
COMPUTATION OF EARNINGS PER SHARE
(Amounts and shares in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30 September 30
1995 1994 1995 1994
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Primary and fully diluted earnings:
Average common shares outstanding........ 35,481 36,533 35,737 36,514
Common share equivalents:
Performance share plan................. 503 230 350 236
Total shares..................... 35,984 36,763 36,087 36,750
Net earnings............................... $59,148 $37,600 $122,841 $66,108
Primary and fully diluted earnings per
share of common stock:................. $ 1.64 $ 1.02 $ 3.40 $ 1.80
</TABLE>
<TABLE>
<CAPTION>
EXHIBIT 12
VULCAN MATERIALS COMPANY AND SUBSIDIARY COMPANIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Amounts in thousands)
For the Years Ended December 31
1994 1993 1992 1991 1990
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Fixed charges:
Interest expense before
capitalization credits $ 10,699 $ 10,187 $ 10,441 $ 11,336 $ 9,349
Amortization of financing costs 114 115 116 75 44
One-third of rental expense 10,393 7,375 8,711 4,815 5,678
Total fixed charges $ 21,206 $ 17,677 $ 19,268 $ 16,226 $ 15,071
Net earnings from continuing
operations $ 97,976 $ 88,229 $ 90,980 $ 52,580 $120,278
Provision for income taxes 47,930 36,993 39,746 20,867 58,951
Fixed charges 21,206 17,677 19,268 16,226 15,071
Capitalized interest credits (878) (1,016) (673) (131) (1,591)
Amortization of capitalized interest 997 882 792 840 705
Earnings from continuing operations
before income taxes as adjusted 67,231 $142,765 $150,113 $ 90,382 $193,414
Ratio of earnings to fixed charges 7.9 8.1 7.8 5.6 12.8
For the Nine Months
Ended September 30, 1995
Fixed charges:
Interest expense before
capitalization credits $ 8,888
Amortization of financing costs 82
One-third of rental expense 6,702
Total fixed charges 15,672
Net earnings $122,841
Provision for income taxes 68,202
Fixed charges 15,672
Capitalized interest credits (238)
Amortization of capitalized interest 799
Earnings before income taxes
as adjusted $207,276
Ratio of earnings to fixed charges 13.2
<FN>
NOTE: Since 1987, the Company has guaranteed a portion of certain debts of two
of the entities through which it participates in the Crescent Market
Project. In addition, since February 1994, the Company has guaranteed a
portion of certain debt of a third entity. The fixed charges associated
with such guaranties (under which the Company has not been required to
make any payments) for the nine months ended September 30, 1995, were
$2,084,000 and for the one-year periods ended December 31, 1994, 1993,
1992, 1991, and 1990 were $2,666,000, $2,731,000, $3,583,000, $3,525,000
and $2,535,000, respectively. Because the Company's ownership interest
in the Crescent Market Project is accounted for by the equity method,
these amounts have not been included in the computation of the ratios
of earnings to fixed charges presented above.
</TABLE>
Item 2. Management's Discussion and Analysis of Results
of Operations and Financial Condition
GENERAL COMMENTS
Seasonality of the Company's Business
Results of any individual quarter are not necessarily indicative of results
to be expected for the year due principally to the effect that weather can
have on the sales and production volume of the Construction Materials
segment. Normally, the highest sales and earnings of the Construction
Materials segment are attained in the third quarter and the lowest are
realized in the first quarter when sales and earnings are substantially
below the levels realized in all subsequent quarters of the year.
Basis of Determining Sales Volume and Price Variances
Sales volume variances are calculated by multiplying the period-to-period
change in sales units by the prior period's unit sales prices. Sales price
variances are calculated by multiplying the period-to-period change in unit
sales prices by the current period's sales units. To the extent that
products and market areas are combined for these computations, the resultant
"volume" and "price" variances may each be affected by period-to-period
changes in the "mix" of product and market area sales.
Segment Sales and Earnings
Segment sales and earnings have been determined on the same basis as used in
prior Form 10-Q reports. Segment earnings are earnings before interest
expense and income taxes and after allocation of corporate expenses and
income, other than "interest income, etc.," (principally interest income
earned on cash items and gains or losses on corporate financing transactions),
and after assignment of equity income to the segment with which it is related
in terms of products and services. Allocations are based primarily on one or
a combination of the following factors: average gross investment, average
equity and sales.
RESULTS OF OPERATIONS
CONDENSED STATEMENTS OF CONSOLIDATED EARNINGS
THIRD QUARTER 1995 AS COMPARED WITH THIRD QUARTER 1994
Third quarter sales, net earnings and earnings per share were at record
levels. Sales of $422.0 million increased 17% from the 1994 third quarter
level. The segment detail of that increase is as follows (amounts in
millions):
Third Quarter Sales
1995 1994 Increase
Construction Materials $269.8 $251.1 $18.7
Chemicals 152.2 109.3 42.9
Total $422.0 $360.4 $61.6
Both Construction Materials and Chemicals reported record third quarter sales.
Construction Materials sales increased 7% from last year's third quarter
total. Both crushed stone shipments and prices increased 5%. Chemicals
third quarter sales were up 39% from last year's level due principally to
sharply higher prices for caustic soda and for chlorinated organic products.
Third quarter sales also benefited from the June 1, 1995 acquisition of Rio
Linda Chemical Company and an additional month of sales from the August 1,
1994 acquisition of Callaway Chemical Company. Excluding the effects of
these two acquisitions, third quarter Chemicals sales were up 33%.
Cost of goods sold increased 7% in the third quarter of 1995 from the 1994
level. The increase reflects higher volumes in both segments and higher
Construction Materials costs, partially offset by lower raw material costs in
the Chemicals segment. As a percentage of sales, cost of goods sold was 68%
in the third quarter of 1995 and 75% for the same period last year.
Selling, administrative and general expenses of $39.6 million increased 17%
from the 1994 third quarter level. This reflects principally higher
professional fees and the effect of Chemicals acquisitions.
Other income, net of other charges, totaled $2.6 million in the third quarter,
down $489,000 as compared with the same period last year. This reflects lower
gains on the sale of assets, offset by improved results from the Crescent
Market Project (the Company's joint venture to supply limestone from Mexico to
the U.S. Gulf Coast market).
Earnings before interest expense and income taxes were $95.8 million, up 65%
from comparable 1994 earnings. The segment detail of this result is shown
in the following summary (amounts in millions):
Third Quarter Earnings (Loss) Before
Interest Expense and Income Taxes *
Increase
1995 1994 (Decrease)
Construction Materials $67.8 $59.4 $ 8.4
Chemicals 28.0 (1.7) 29.7
Segment earnings 95.8 57.7 38.1
Interest income, etc. - .2 (.2)
Total $95.8 $57.9 $37.9
* After allocation of corporate expense and income, other than
"interest income, etc." (principally interest income earned on
short-term investment of funds and gains or losses on corporate
financing transactions), and after assignment of equity income
to the segment with which it is related in terms of products
and services.
Record third quarter earnings for the Construction Materials segment
were up 14% from last year's result. Improved crushed stone prices and
volumes were partially offset by higher costs. Some of the cost
increases reflect higher spending on the development of several new
quarry sites. The Chemicals segment recorded third quarter earnings of
$28.0 million as compared with last year's third quarter loss of $1.7
million. The improvement reflects the effect of higher selling prices
for caustic soda and chlorinated organic products as well as lower raw
material costs. Third quarter earnings were reduced by a $3.5 million
charge for environmental remediation at the Cleve Reber Superfund site
in Louisiana.
The provision for income taxes for the third quarter was $33.6 million,
as compared with last year's third quarter expense of $17.5 million.
The increase reflects the higher pretax earnings as well as the higher
tax rate. The effective tax rate was 36.2% for the third quarter and
35.7% for the first nine months, up significantly from the 31.8% rate
applicable to both periods in 1994. The increases reflect principally
a decreased relative effect of statutory depletion, which had a lesser
impact on the 1995 rates because of significantly higher Chemicals
earnings.
Net earnings of $59.1 million and earnings per share of $1.64 were up
57% and 61%, respectively, from comparable 1994 results.
CONDENSED STATEMENTS OF CONSOLIDATED EARNINGS
YEAR-TO-DATE COMPARISONS AS OF
SEPTEMBER 30, 1995 AND SEPTEMBER 30, 1994
Sales of $1,099.2 million for the first nine months of 1995 also were at
a record level, and increased 22% from the $904.0 million reported for
the same period last year. Sales of the segments are summarized as
follows (amounts in millions):
Sales for the Nine Months
Ended September 30
1995 1994 Increase
Construction Materials $ 663.5 $621.4 $ 42.1
Chemicals 435.7 282.6 153.1
Total $1,099.2 $904.0 $195.2
Construction Materials sales were up 7% over 1994. Crushed stone
shipments and prices increased approximately 5%. Chemicals sales
increased 54%, reflecting higher prices and the effect of acquisitions.
Excluding the effects of the Callaway and Rio Linda acquisitions, the
increase was 34%.
Cost of goods sold for the current year-to-date increased 11%. As
a percentage of sales, cost of goods sold was 72% in 1995 and 79%
in 1994.
Selling, administrative and general expenses were $115.8 million, up
28%. The increase reflects the Chemicals acquisitions and higher
provisions for management incentives.
Other income, net of other charges, increased $3.0 million from
comparable 1994 levels. This reflects improved results from the
Crescent Market Project.
Earnings for the current year-to-date before interest expense and income
taxes were $199.7 million, almost double the 1994 result of $104.2
million. Segment detail is shown below (amount in millions):
Earnings (Loss) Before Interest Expense
and Income Taxes for the
Nine Months Ended September 30 *
Increase
1995 1994 (Decrease)
Construction Materials $132.0 $113.8 $ 18.2
Chemicals 67.7 (10.1) 77.8
Segment earnings 199.7 103.7 96.0
Interest income, etc. - .5 (.5)
Total $199.7 $104.2 $ 95.5
* After allocation of corporate expense and income,
other than "interest income, etc." (principally
interest income earned on short-term investment of
funds and gains or losses on corporate financing
transactions), and after assignment of equity income
to the segment with which it is related in terms of
products and services.
Construction Materials segment earnings were up 16% due to higher
prices and volumes, which were partially offset by increased
operating costs. The Chemicals segment increase principally
reflected higher prices.
The provisions for income taxes for the first nine months of 1995
and 1994 were $68.2 million and $30.8 million, respectively. The
increase reflects the effect of greater earnings and the higher tax
rate.
Record net earnings and earnings per share of $122.8 million and
$3.40 were up more than 85% from comparable 1994 levels.
On October 23, 1995, H. A. Sklenar, Chairman and Chief Executive
Officer, made certain statements concerning the Company's earnings
outlook. Excerpts of the relevant press release quoting Mr. Sklenar
are as follows:
"Third quarter shipments in our Construction Materials
business were stronger than expected and resulted in
year-to-date record segment earnings. In last year's
fourth quarter, good weather helped generate very strong
earnings for the segment. Notwithstanding significant
anticipated gains from sales of excess land in this year's
fourth quarter, it will be a challenge to equal last year's
record quarterly result. Nonetheless, for the year as a
whole, we expect Construction Materials earnings to be at a
record level.
"The recovery in caustic soda prices continued to be the
major factor contributing to improved sales and earnings in
our Chemicals segment. In addition, earnings benefited
from stronger market conditions for chlorinated organic
products. Stronger pricing in those products has permitted
us to recover much of the profitability lost in 1994 due to
higher raw material prices. Favorable market conditions
for caustic soda and chlorinated organics should continue
to benefit year-over-year earnings comparisons in the
fourth quarter, although at a significantly lesser rate of
improvement than that experienced in the third quarter.
For the full year, we expect Chemicals earnings to be at a
record level.
"Third quarter earnings of the Chemicals segment included a
$3.5 million charge for environmental remediation at the
Cleve Reber Superfund site in Louisiana. Remediation has
been virtually completed and we do not expect any future
earnings charges referable to this site.
"For the Company as a whole, strong performances in both
segments should result in 1995 records - by substantial
margins - for sales, net earnings and earnings per
share."
LIQUIDITY AND CAPITAL RESOURCES
CONDENSED CONSOLIDATED BALANCE SHEETS - SEPTEMBER 30, 1995
AS COMPARED WITH DECEMBER 31, 1994 AND SEPTEMBER 30, 1994
AND
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
COMPARISONS FOR THE YEAR TO DATE AS OF
SEPTEMBER 30, 1995 AND SEPTEMBER 30, 1994
Working Capital
Working capital, exclusive of debt and cash items, was $214.2 million at
September 30, 1995, up 29% from the 1994 year-end total. The increase was
primarily due to higher receivables as a result of the sales level. Working
capital at September 30, 1995 increased 3% from the same date last year.
Higher receivables due to increased sales were offset by higher current
liabilities.
The Company's current ratio, which is based on all components of working
capital, including debt and cash items, was 1.5 as of September 30, 1995.
This was down slightly from the 1.6 ratio for both December 31, 1994 and
September 30, 1994.
Cash Flows
Cash provided by continuing operations during the first nine months totaled
$148.5 million, up 30% from the $114.4 million generated in the same period
last year. This increase reflects principally higher net earnings. Cash used
for investing activities totaled $90.3 million as compared with the 1994 total
of $150.0 million, reflecting a decrease in spending for business
acquisitions. Net cash used for financing activities totaled $55.9 million
as compared with cash provided of $30.8 million in 1994. This change
reflects lower net borrowings and a sharp increase in purchases of common
stock in 1995. There were no purchases of common stock in the first nine
months of 1994.
Common Stock Transactions
Pursuant to the Company's common stock purchase program, 833,400 shares of
common stock were purchased in the third quarter of 1995 at a total cost of
$44.1 million, equal to an average price of $52.97 per share. In the first
nine months of 1995, 939,700 shares were purchased at a total cost of $49.7
million, or an average of $52.89 per share.
Property Additions
Property additions in the first nine months of 1995 totaled $92.6 million as
compared with $142.5 million in the same period last year. The decrease
reflects lower spending for acquisitions. During the third quarter, the
Company acquired an aggregates business in Indiana which included three
production operations.
Short-term Borrowings
Short-term borrowings as of September 30, 1995 and 1994 consisted of notes
payable to banks totaling $80.3 million and $76.8 million, respectively.
Long-Term Obligations
As of September 30, 1995, long term obligations were 9.2% of long-term capital
and 12.2% of shareholders' equity. The corresponding 1994 percentages were
10.0% and 13.2%, respectively.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
As previously reported in the Company's Annual Report on Form 10-K,
lawsuits naming the Company have been filed in the District Courts of
Jefferson and Ector counties, Texas, by individual plaintiffs
alleging silicosis arising from exposure to industrial sand used for
abrasive blasting which was marketed by the Company from 1988 to
1994. The Company is but one of from 20-40 defendants named in each
case. As of this date, 28 such cases are pending against the
Company. At this time, the Company does not expect that settlements
or adverse judgments, if any, will adversely affect the consolidated
financial position of the Company to a material extent.
On August 30, 1995, a complaint was filed in the District Court of
Nueces County, Texas, 214th Judicial District, by 144 individual
plaintiffs against 93 defendants, including the Company. Plaintiffs
allege personal injuries and damages arising from exposure to
petroleum products, asbestos, chemicals, solvents, minerals, metals
and other products in connection with plaintiffs' employment at the
Corpus Christi Army Depot in Corpus Christi, Texas. Plaintiffs' ad
damnum plea is for $100 Million in compensatory damages and "at
least" $400 Million in punitive damages from all defendants. The
Company has retained counsel and is currently defending the action.
The Company does not believe that its potential share, if any, of
costs related to this action will adversely affect the consolidated
financial position of the Company to a material extent.
The Company has received an Administrative Order ("AO"), dated
September 28, 1995, issued by the EPA under the Clean Water Act and
alleging that on various dates from August 1994 through July 1995,
the Company's Geismar, Louisiana, chemicals manufacturing facility
exceeded certain of the effluent limitations which are conditions of
the facility's NPDES permit. The AO purports to order, in pertinent
part, that the Geismar facility take whatever corrective action is
necessary to eliminate and prevent reoccurrence of the alleged permit
exceedances. The Company intends in good faith to comply with the
terms and conditions of this AO to the full extent required by
applicable law. The Company does not anticipate that this matter
will adversely affect the consolidated financial position of the
Company to a material extent.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits furnished in accordance with Item 601 of Regulation S-K
and included in Part I:
Exhibit 11 - Computation of Earnings per Share
Exhibit 12 - Computation of Ratio of Earnings to
Fixed Charges
(b) Reports on Form 8-K
There were no reports on Form 8-K filed for the three months
ended September 30, 1995.
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.
VULCAN MATERIALS COMPANY
Date November 13, 1995 /s/ D. F. Sansone
Vice President, Finance
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Consolidated Statement of Earnings for the nine months ended September 30,
1995 and is qualified in its entirety by reference to such statements.
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
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