<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
(x) QUARTERLY REPORT PURSUANT TO SECTION 13 or 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended
September 30, 1996
Commission File Number 0-3730
Willamette Industries, Inc.
(Exact name of registrant as specified in its charter)
State of Oregon 93-0312940
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1300 S.W. Fifth Avenue, Suite 3800, Portland, Oregon 97201
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (503) 227-5581
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
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common Stock, 50 cent par value: 55,328,235, November 11, 1996.
<PAGE>
<TABLE>
<CAPTION>
WILLAMETTE INDUSTRIES, INC. AND SUBSIDIARIES FORM 10-Q
CONSOLIDATED BALANCE SHEETS PART I
(dollar amounts, except per share amounts, in thousands) ITEM 1
September 30, December 31,
ASSETS 1996 1995
------ ------------ ------------
<S> <C> <C>
Current assets:
Cash $ 61,226 17,961
Accounts receivable, less allowance
for doubtful accounts of $6,228 and $5,446 285,034 314,070
Inventories (Note 2) 350,330 391,358
Prepaid expenses and deposits on timber cutting contracts 30,188 51,448
Assets held for sale (Note 3) 201,807 -
Total current assets 928,585 774,837
Timber, timberlands and related facilities, net (Note 3) 1,444,770 518,873
Property, plant and equipment, at cost less
accumulated depreciation of $1,662,071 and $1,494,383 2,184,353 2,054,868
Other assets 76,234 64,977
--------- ---------
$ 4,633,942 3,413,555
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current installments on long-term debt $ 635 29,598
Notes payable (Note 3) 220,000 51,000
Accounts payable, includes book overdrafts
of $38,595 and $58,158 158,186 180,176
Accrued expenses 167,591 130,269
Accrued income taxes 32,006 24,536
--------- ---------
Total current liabilities 578,418 415,579
Deferred income taxes 346,505 330,142
Other liabilities 28,108 30,734
Long-term debt, net of current installments (Notes 3 & 4) 1,716,638 790,210
Stockholders' equity:
Preferred stock, cumulative, of $.50 par value.
Authorized 5,000,000 shares. - -
Common stock, $.50 par value. Authorized 150,000,000
shares; issued 55,313,685 and 55,223,706 shares. 27,657 27,612
Capital surplus 304,712 300,757
Retained earnings 1,631,904 1,518,521
--------- ---------
Total stockholders' equity 1,964,273 1,846,890
--------- ---------
$ 4,633,942 3,413,555
========= =========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
WILLAMETTE INDUSTRIES, INC. AND SUBSIDIARIES FORM 10-Q
CONSOLIDATED STATEMENTS OF EARNINGS PART I
(dollar amounts, except per share amounts, in thousands) ITEM 1
Three Months Ended Nine Months Ended
September 30, September 30,
---------------------- ----------------------
1996 1995 1996 1995
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net sales $ 862,674 1,019,420 2,587,578 2,923,605
Cost of sales 707,532 707,464 2,090,505 2,092,831
--------- --------- --------- ---------
Gross profit 155,142 311,956 497,073 830,774
Selling and administrative expenses 56,358 49,052 167,148 150,533
--------- --------- --------- ---------
Operating earnings 98,784 262,904 329,925 680,241
Other income(expense), net 539 (2) 1,712 387
--------- --------- --------- ---------
99,323 262,902 331,637 680,628
Interest expense 29,423 17,853 64,615 56,018
--------- --------- --------- ---------
Earnings before taxes 69,900 245,049 267,022 624,610
Provision for income taxes 26,771 94,344 102,269 240,475
--------- --------- --------- ---------
Net earnings $ 43,129 150,705 164,753 384,135
========= ========= ========= =========
Weighted average number of
shares outstanding 55,274,089 55,210,587 55,246,831 55,107,119
========== ========== ========== ==========
Per share information:
Net earnings $ 0.78 2.73 2.98 6.97
========== ========== ========== ==========
Dividends $ 0.31 0.30 .93 0.84
========== ========== ========== ==========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
WILLAMETTE INDUSTRIES, INC. AND SUBSIDIARIES FORM 10-Q
CONSOLIDATED STATEMENTS OF CASH FLOWS PART I
(dollar amounts in thousands) ITEM 1
Nine Months Ended
September 30,
---------------------------
1996 1995
----------- ---------
<S> <C> <C>
Cash flows from operating activities:
Net earnings $ 164,753 384,135
Adjustments to reconcile net earnings to net cash
from operating activities:
Depreciation 182,402 160,495
Cost of fee timber harvested 31,042 18,645
Other amortization 9,555 4,631
Increase in deferred income taxes 16,363 72,480
Changes in working capital items:
Accounts receivable 29,036 (90,885)
Inventories 55,625 (113,103)
Prepaid expenses and timber deposits 21,260 3,233
Accounts payable and accrued expenses (104) 15,885
Accrued income taxes 7,470 17,499
Assets held for sale (Note 3) (201,807) -
----------- --------
Net cash from operating activities 315,595 473,015
----------- --------
Cash flows from investing activities:
Proceeds from sale of equipment 814 572
Expenditures for property, plant and equipment (305,012) (297,127)
Expenditures for timber and timberlands, net (6,440) (16,582)
Expenditures for roads and reforestation (8,632) (5,547)
Acquisition of Cavenham (Note 3) (957,385) -
Other (14,673) (6,994)
----------- --------
Net cash from investing activities (1,291,328) (325,678)
Cash flows from financing activities:
Debt borrowing 1,132,254 76,134
Proceeds from sale of common stock 3,903 9,521
Cash dividends paid (51,370) (46,294)
Payment on debt (65,789) (185,474)
Net cash from financing activities 1,018,998 (146,113)
----------- --------
Net change in cash 43,265 1,224
Cash at beginning of period 17,961 12,798
----------- --------
Cash at end of period $ 61,226 14,022
=========== ========
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest (net of amount capitalized) $ 67,785 55,797
=========== ========
Income taxes $ 78,803 150,496
=========== ========
</TABLE>
<PAGE>
FORM 10-Q
PART I
ITEM 1
WILLAMETTE INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1996
Note 1 The information furnished in this report reflects all
adjustments which are, in the opinion of management,
necessary to a fair statement of the results for the
interim periods presented.
Note 2 The components of inventories are as follows
(thousands of dollars):
September 30, December 31,
1996 1995
------------ -----------
Finished product $ 96,974 98,055
Work in process 7,357 7,712
Raw material 169,277 212,651
Supplies 76,722 72,940
------------ -----------
$ 350,330 391,358
============ ==========
Note 3 On May 15, 1996, the Company acquired approximately
602,000 acres of timberland, a sawmill and related
assets in Louisiana and the Pacific Northwest from
Hanson Natural Resources Company, an affiliate of
Hanson plc. (the "Cavenham acquisition"). The
purchase price for the properties was $1.145 billion.
The Company has entered into a contract to convey
approximately 56,000 acres of the Oregon timberland
included in the Cavenham acquisition to a third party
for approximately $198 million, plus certain expenses
incurred by the Company, and is reflected herein as
"Assets held for sale." After giving effect to the
sale to a third party, the Company acquired 546,000
acres of timberland, a sawmill and related assets for
$947 million, plus post-closing adjustments which, at
September 30, 1996, approximate $10 million.
The Company funded the acquisition from cash and $1.1
billion of borrowing under a Credit Agreement among
the Company and a group of banks providing for a
revolving loan and a term loan. The revolving loan
provides for borrowings of up to $1.0 billion in
principal amount to mature on May 15, 2001, and had an
initial outstanding principal balance of $500 million
($300 million at September 30, 1996). The revolving
loan also provides backup credit for a Master Note
program which at September 30, 1996, had an
outstanding principal balance of $235 million. The
term loan was in the principal amount of $600 million
and matures on May 15, 1998. The weighted average
interest rates per annum for the indebtedness
outstanding under the revolving loan, Master Note
program and term loan at September 30, 1996 were
5.77%, 5.57% and 5.72%, respectively. $200 million of
the term loan is reflected in "Notes payable" and
corresponds to the anticipated sale of the "Assets
held for sale" and concurrent paydown of a portion of
the term loan upon such sale with the net proceeds
therefrom as required by the Credit Agreement.
Interest expense does not include any adjustments for
interest on debt attributable to the "Assets held for
sale" as these costs are reimbursable expenses
pursuant to the agreement with the purchaser. The
remaining $400 million of the term loan was prepaid on
July 1, 1996 with the proceeds of the issuance of
public debt discussed in Note 4.
The purchase price of the 546,000 acres of timberland and
related assets that the Company retained was allocated as
follows:
Purchase price $ 957,385
=======
Timber, timberlands and
related facilities, net $ 950,723
Property, plant and equipment 7,720
Inventories 14,597
Liabilities (15,655)
-------
$ 957,385
=======
Note 4 On July 1, 1996, the Company issued $400 million in
debentures, $200 million at 7.85% due July 1, 2026 and
$200 million at 7.35% due July 1, 2026. The holders
of the 7.35% debentures may elect to have such
debentures repaid on July 1, 2006. The proceeds of the
sale were used to reduce indebtedness under the term
loan made pursuant to the Credit Agreement relating to
the Cavenham acquisition.
Other notes have been omitted pursuant to Rule 10-
01(a)(5) of Regulation S-X.
<PAGE>
FORM 10-Q
PART I
ITEM 2
WILLAMETTE INDUSTRIES, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION
September 30, 1996
The Company's two basic businesses, paper products and building
materials, are affected by changes in general economic conditions.
Paper product sales and earnings tend to follow the general economy.
Building materials activity is closely related to new housing starts and
to the availability and terms of financing for construction. Both
industry segments use timber as the basic raw material. The cost of
timber is sensitive to various supply and demand factors, including
environmental issues affecting log supply.
<TABLE>
<CAPTION>
SEGMENT INFORMATION
SALES AND GROSS PROFIT BY QUARTER
Sales:
BUILDING MATERIALS GROUP PAPER GROUP
------------------------ -----------
% %
1996 1995 change 1996 1995 change
---- ---- ------ ---- ---- ------
<S> <C> <C> <C> <C> <C> <C>
1st Qtr. $ 226,438 278,197 (18.6) 639,674 622,441 2.8
-------------------------------------------------------------------------------
2nd Qtr. 272,535 281,795 (3.3) 586,257 721,752 (18.8)
-------------------------------------------------------------------------------
3rd Qtr. 299,868 258,083 16.2 562,806 761,337 (26.1)
-------------------------------------------------------------------------------
Total $ 798,841 818,075 (2.4) 1,788,737 2,105,530 (15.0)
===============================================================================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Gross Profit and Gross Profit Margins (GPM):
BUILDING MATERIALS GROUP PAPER GROUP
------------------------ -----------
GPM GPM GPM GPM
1996 % 1995 % 1996 % 1995 %
---- - ---- - ---- - ---- -
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1st Qtr. $ 23,769 10.5 64,424 23.2 164,177 25.7 165,405 26.6
--------------------------------------------------------------------------------
2nd Qtr. 39,705 14.6 68,208 24.2 114,280 19.5 221,760 30.7
--------------------------------------------------------------------------------
3rd Qtr. 48,683 16.2 57,100 22.2 106,459 18.9 257,762 33.9
--------------------------------------------------------------------------------
Total $ 112,157 14.0 189,732 23.2 384,916 21.5 644,927 30.6
================================================================================
</TABLE>
RESULTS OF OPERATIONS
3rd Quarter 1996 vs. 3rd Quarter 1995
Net sales decreased 15.4% in the third quarter of 1996 compared with the
record third quarter of 1995 primarily due to pricing pressures. Total paper
product sales decreased by 26.1% in the third quarter of 1996 compared with
the third quarter of 1995 as a result of sales price realizations
significantly decreasing in all paper product lines from 1995 third quarter
record highs. The decrease ranged from 22.2% to 48.8% as pricing pressures in
all product lines continued from the first and second quarter. Decreases in
sales price realizations were partially offset by strengthening demand in the
latter part of the third quarter. Copy paper markets continued to experience
stronger demand as volume increased 3.2% in the third quarter of 1996 compared
with the third quarter of 1995. In addition, positive momentum in demand was
evident in September in the specialty and commodity markets. For unbleached
paper product lines, sales volume increased 9.5% in the corrugated container
line, however the paper bag line experienced volume decreases of 9.0% for the
third quarter of 1996 compared to the same period in 1995.
Building materials sales increased 16.2% compared with the third quarter
of 1995. Lumber markets were healthy performers in the third quarter of 1996
due to strong housing starts as both sales price realizations and unit
shipments increased over the third quarter of 1995 by 8.0% and 61.3%,
respectively. A significant portion of the unit volume increase is
attributable to the Warrenton, Oregon sawmill purchased in the Cavenham
acquisition (see Note 3 in Notes to Consolidated Financial Statements).
Plywood markets showed strength in the third quarter as unit volumes increased
3.3% over the same period in 1995. However, competition and the supply and
demand imbalance created from the construction of several new structural panel
and composite board plants continued to affect sales price realizations which
decreased 17.8% from the third quarter of 1995. In addition, medium density
fiberboard ("MDF") reflected unit shipment increases over the third quarter of
1995 of 32.5%, primarily attributable to the late March 1996 start-up of the
newly-converted Eugene, Oregon plant. The MDF volume increase was offset by a
sales price realization decrease of 13.2% caused by the supply and demand
imbalance. The Company also began producing oriented strand board ("OSB") in
late April 1996 at its new Arcadia, Louisiana plant. The pricing pressure on
the panel market affected OSB as well, as prices decreased 14.5% in the third
quarter of 1996 from the second quarter of 1996. During the third quarter of
1996, the Company began production of laminated veneer lumber (LVL) at its new
Millersburg, Oregon plant. When at full capacity, the plant will double the
Company's capacity for LVL.
Gross profit margins decreased to 18.0% in the third quarter of 1996
from 30.6% in the record third quarter of 1995. Paper product gross margins
decreased to 18.9% from 33.9% in the third quarter of 1995 as average sales
prices declined in all paper product lines. Partially offsetting the
unfavorable sales prices was a nearly 40% decline of old corrugated container
(OCC) costs in the third quarter of 1996, compared with the same period in
1995. Building materials gross margins were 16.2% in the third quarter of 1996
which is down from the 22.1% margin realized in the third quarter of 1995.
The decrease in margin is primarily the result of declining prices in all
product lines, excluding lumber, in the third quarter of 1996 compared to
1995. In addition, start-up costs associated with the Eugene, Oregon MDF
plant and the OSB plant in Arcadia, Louisiana continue to have an impact.
Selling and administrative expenses increased $7.3 million or 14.9%
mostly due to expansion of Company operations. The ratio of selling and
administrative expenses to net sales increased to 6.5% for the third quarter
of 1996 compared with 4.8% for the same period in 1995. The increase in the
ratio was due primarily to lower net sales as well as higher selling and
administrative expenses.
Interest expense was $29.4 million in the third quarter of 1996 compared
with $17.9 million in the third quarter of 1995. Interest expense increased
due to increased borrowings in connection with the May 15, 1996, Cavenham
acquisition. The increase in interest expense attributable to the increase in
the outstanding debt was partially offset by a decrease in the Company's
effective interest rate on average outstanding debt from 7.79% for the third
quarter of 1995 to 7.13% for the same period in 1996. In addition, capitalized
interest increased from $1.3 million in the third quarter of 1995 to $2.5
million in the same period of 1996.
<PAGE>
Nine Months ended September 30, 1996 vs.
Nine Months ended September 30, 1995
Net sales decreased 11.5% in the first nine months of 1996 from the
comparable period of 1995. Total paper product sales decreased by 15.0% as a
result of sales price realization decreases in all paper product lines. This
decrease was partially offset by volume shipment increases in cut sheet copy
paper and corrugated containers of 22.7% and 2.9%, respectively, in the first
nine months of 1996 compared with the same period of a year ago. Building
materials sales decreased 2.4% in the nine months ended September 30, 1996 as
decreases in sales price realizations more than offset increases in sales
volumes. The strengthened lumber market has seen price and volume increases
of 2.0% and 17.1%, respectively, over the first nine months of 1995. Prices
in the structural panel and composite board markets have continued to decline
due to supply and demand imbalances created by the construction of new
facilities. Volume increases were primarily the result of the addition of the
Warrenton, Oregon sawmill, the converted Eugene, Oregon MDF plant and the new
Arcadia, Louisiana OSB plant.
The gross profit margin was 19.2% for the nine months ended
September 30, 1996 compared to 28.4% for the comparable period in 1995. Paper
product gross margins were 21.5% for the first nine months of 1996 compared
with 30.6% for the nine months ended September 30, 1995, reflecting primarily
lower sales price realizations. Declines in OCC costs had a positive impact
on gross margins as they decreased 47.5% for the nine months ended September
30, 1996 compared to 1995. Building materials gross profit margins decreased
to 14.0% compared with 23.2% in the first nine months of 1995. The decrease in
building materials margins was the result of lower sales price realizations
and start-up costs associated with the Company's new OSB and MDF plants in the
current year.
Selling and administrative expenses increased to 6.5% of net sales in
the first nine months of 1996 compared with 5.1% for the same period in 1995.
The increase was due primarily to lower net sales as well as higher selling
and administrative expenses from expansion of Company operations.
Interest expense was $64.6 million in the first nine months of 1996 compared
to $56.0 million in the first nine months of 1995. Interest expense increased
as a result of increased debt related to the May 15, 1996, Cavenham
acquisition. The increase in interest expense attributable to the increase in
outstanding debt was partially offset by a decrease in the Company's effective
interest rate on average outstanding debt from 7.90% for the first nine months
of 1995 to 7.13% for the same period in 1996. Additionally, capitalized
interest increased from $4.0 million in the first nine months of 1995 to $7.1
million in the same period of 1996.
Financial Condition as of September 30, 1996
During the first nine months of 1996, the Company had capital
expenditures of $320.1 million that were funded by internally generated cash
flows. Cash flows from operating activities, net of cash flows from assets
held for sale, increased $44.4 million or 9.4% in the first nine months of
1996 from the comparable period in 1995 mainly due to reductions in
outstanding accounts receivable and inventory levels, offset by the decrease
in net earnings. Cash flows from assets held for sale are excluded as the
assets were obtained through third party financing which will be repaid upon
the sale.
On May 15, 1996, the Company acquired approximately 602,000 acres of
timberland, a sawmill and related assets in Louisiana and the Pacific
Northwest for $1.145 billion. The Company has entered into a contract to
convey approximately 56,000 acres of the Oregon timberland included in the
Cavenham acquisition to a third party for approximately $198 million, plus
certain expenses incurred by the Company, which is reflected in current assets
as "Assets held for sale." The Company funded the acquisition from cash and
$1.1 billion of borrowing under a Credit Agreement among the Company and a
group of banks providing for a revolving loan and a term loan. The total debt
to capital ratio has increased to 49.7% at September 30, 1996 from 32.0% at
December 31, 1995 due to the Cavenham acquisition. The total debt to capital
ratio, excluding the $200 million classified as "Notes payable" to be repaid
upon the sale of the related assets, is 46.9%. The Company anticipates it can
maintain its present course of capital spending over the next three years and
still bring its debt to capital ratio back to below 40% by 1999. Despite a
significant increase in the Company's debt to capital ratio, rating agencies
have maintained the Company's credit rating in the "A" range, thereby
preserving its cost of capital. Net working capital decreased to $350.2
million at September 30, 1996 from $359.3 million at December 31, 1995
primarily due to decreases in current assets.
On July 1, 1996, the Company issued $400 million in debentures - $200
million at 7.85% due July 1, 2026 and $200 million at 7.35% due July 1, 2026.
The holders of the 7.35% debentures may elect to have such debentures repaid
on July 1, 2006. The proceeds of the sale were used to reduce indebtedness
under the term loan used to fund the Cavenham acquisition, thus the debenture
issuance had no effect on the Company's total debt to capital ratio.
The Company believes it has the resources available to meet its short-
term and long-term liquidity requirements. Resources include internally
generated funds, short-term borrowing agreements and the unused portion of the
revolving loan available under the Credit Agreement.
On September 18, 1996, the Company announced that it reached an
agreement in principle to acquire the stock of Medite of Europe Limited from
Medite Corporation for $61.5 million in cash. Medite of Europe manufactures
MDF at its plant in Clonmel in southern Ireland for sale in the United
Kingdom, continental Europe and Ireland. Completion of the transaction is
scheduled for the fourth quarter of 1996 and expected to be financed by
borrowing utilizing the revolving loan under the Credit Agreement.
The Board of Directors of the Company voted to pay a quarterly cash
dividend of $.31 share in the third quarter of 1996; however, there is no
assurance to future dividends as they are dependent upon earnings, capital
requirements and financial condition.
In August, 1995, the Board of Directors of the Company authorized the
repurchase of up to $100 million of the Company's common stock. As of
June 30, 1996, the Company had repurchased 50,000 shares of its common stock
for $2.7 million.
Forward-looking statements
Statements contained in this report that are not historical in nature,
including the discussion of the anticipated reduction in the Company's debt to
capital ratio and the adequacy of the Company's liquidity resources, are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are subject to
risks and uncertainties that may cause actual future results to differ
materially. Such risks and uncertainties with respect to the Company include
the effect of general economic conditions; the level of new housing starts and
remodeling activity; the availability and terms of financing for construction;
competitive factors, including pricing pressures; the cost and availability of
wood fiber; the effect of natural disasters on the Company's timberlands; and
the impact of environmental regulations and the construction and other costs
associated with complying with such regulations.
<PAGE>
FORM 10-Q
PART II
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit No. Exhibit
---------- -------
12 Computation of
Ratio of Earnings
to Fixed Charges.
27 Financial Data Schedule.
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter for which this
report is filed.
<PAGE>
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.
WILLAMETTE INDUSTRIES, INC.
By /s/J. A. Parsons
J. A. Parsons
Executive Vice President
(Principal Financial Officer)
Date: November 13, 1996
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Exhibit 12
WILLAMETTE INDUSTRIES, INC. AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(DOLLAR AMOUNTS IN THOUSANDS)
Nine Months Ended
Year Ended December 31, September 30,
------------------------------------------ -----------------
1991 1992 1993 1994 1995 1995 1996
-------- ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Fixed Charges:
Interest cost $ 63,986 73,776 79,194 80,807 77,237 60,014 71,748
One-third rent
expense 3,725 4,495 4,819 5,227 5,976 4,350 5,084
-------- ------ ------ ------ ------ ------ ------
Total Fixed Charges $ 67,711 78,271 84,013 86,034 83,213 64,364 76,832
======== ====== ====== ====== ====== ====== ======
Add (Deduct):
Earnings before
income taxes $ 73,609 129,452 189,168 288,923 823,804 624,610 267,022
Interest capitalized (723) (7,354) (15,904) (9,294) (6,187) (3,996) (7,133)
-------- ------ ------ ------ ------ ------ ------
Earnings for
Fixed Charges $ 140,597 200,369 257,277 365,663 900,830 684,978 336,721
======== ======= ======= ======= ======= ======= =======
Ratio of Earnings to
Fixed Charges 2.08 2.56 3.06 4.25 10.83 10.64 4.38
======== ======= ======= ======= ======= ======= =======
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE COMPANY'S CONSOLIDATED BALANCE SHEETS AND
RELATED CONSOLIDATED STATEMENTS OF EARNINGS FOR THE PERIOD
ENDED SEPTEMBER 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 34,230
<SECURITIES> 26,996
<RECEIVABLES> 291,262
<ALLOWANCES> 6,228
<INVENTORY> 350,330
<CURRENT-ASSETS> 928,585
<PP&E> 5,291,194
<DEPRECIATION> 1,662,071
<TOTAL-ASSETS> 4,633,942
<CURRENT-LIABILITIES> 578,418
<BONDS> 1,716,638
0
0
<COMMON> 27,657
<OTHER-SE> 1,936,616
<TOTAL-LIABILITY-AND-EQUITY> 4,633,942
<SALES> 862,674
<TOTAL-REVENUES> 862,764
<CGS> 707,532
<TOTAL-COSTS> 707,532
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 29,423
<INCOME-PRETAX> 69,900
<INCOME-TAX> 26,771
<INCOME-CONTINUING> 43,129
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 43,129
<EPS-PRIMARY> .78
<EPS-DILUTED> .78
</TABLE>
