SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES ACT OF 1934
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES ACT OF 1934
For the Quarter Ended July 1, 2000 Commission File Number 0-5971
WOODHEAD INDUSTRIES, INC.
-------------------------
DELAWARE 36-1982580
--------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
THREE PARKWAY NORTH, SUITE 550, DEERFIELD, IL. 60015
--------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code (847) 236-9300
--------------------------------------------------------------------------------
(Former name, former address or former fiscal year, if changes since last
reports)
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 Act of 1934 during the
preceding 12 months, and (2) has been subject to such filing requirements for
the past 90 days.
Yes ____X____ No _________
On July 25, 2000 there were 11,373,980 shares of the Registrant's common stock
outstanding.
<PAGE>
PART I
ITEM 1 - FINANCIAL INFORMATION
WOODHEAD INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEETS
(Amounts in Thousands)
<TABLE>
<CAPTION>
Unaudited
---------
ASSETS 7/1/00 10/2/99
------ ------------ ------------
<S> <C> <C>
CURRENT ASSETS
Cash and short-term securities $ 6,839 $ 1,425
Accounts receivable 33,403 29,276
Refundable income taxes 376 1,109
Inventories (Note 3) 24,044 24,099
Deferred taxes and other prepaid expenses 7,126 7,171
------------ ------------
Total current assets $ 71,788 $ 63,080
------------ ------------
DEFERRED INCOME TAXES AND OTHER ASSETS $ 6,672 $ 3,315
------------ ------------
PROPERTY, PLANT & EQUIPMENT, at cost $ 122,359 $ 121,281
Less: Accumulated depreciation (61,835) (56,836)
------------ ------------
Net property, plant and equipment $ 60,524 $ 64,445
------------ ------------
GOODWILL $ 23,228 $ 26,801
------------ ------------
TOTAL ASSETS $ 162,212 $ 157,641
============ ============
LIABILITIES & STOCKHOLDERS' INVESTMENT
--------------------------------------
CURRENT LIABILITIES
Notes payable $ -- $ 125
Accounts payable 9,121 8,564
Accrued expenses 17,915 14,524
Income taxes payable 362 1,580
Short-term debt -- --
Portion of long-term debt payable within one year -- --
------------ ------------
Total current liabilities $ 27,398 $ 24,793
------------ ------------
OTHER LIABILITIES $ 2,859 $ 3,274
------------ ------------
LONG-TERM DEBT $ 45,000 $ 47,120
------------ ------------
STOCKHOLDERS' INVESTMENT: (Note 5)
Common stock at par $ 11,371 $ 11,237
Additional paid-in capital 11,920 11,230
Deferred stock compensation (263) (315)
Accumulated other comprehensive income (5,151) (2,117)
Retained earnings 69,078 62,419
------------ ------------
Total stockholders' investment $ 86,955 $ 82,454
------------ ------------
TOTAL LIABILITIES & STOCKHOLDERS' INVESTMENT $ 162,212 $ 157,641
============ ============
</TABLE>
The accompanying notes are an integral part of these statements.
2
<PAGE>
WOODHEAD INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Amounts in Thousands, except per share data; unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
------------------------------ ------------------------------
7/1/00 7/3/99 7/1/00 7/3/99
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
NET SALES $ 49,962 $ 43,190 $ 144,593 $ 126,494
COST OF SALES 29,098 24,636 82,886 71,977
------------ ------------ ------------ ------------
GROSS PROFIT $ 20,864 $ 18,554 $ 61,707 $ 54,517
% of Net Sales 41.8% 43.0% 42.7% 43.1%
OPERATING EXPENSES 14,261 13,340 43,337 39,034
------------ ------------ ------------ ------------
INCOME FROM OPERATIONS $ 6,603 $ 5,214 $ 18,370 $ 15,483
OTHER EXPENSE (INCOME)
Interest Expense $ 742 $ 882 $ 2,260 $ 2,589
Other (Income) Expense, Net 339 (11) 693 (382)
------------ ------------ ------------ ------------
NET OTHER EXPENSE $ 1,081 $ 871 $ 2,953 $ 2,207
------------ ------------ ------------ ------------
INCOME BEFORE INCOME TAXES $ 5,522 $ 4,343 $ 15,417 $ 13,276
PROVISION FOR INCOME TAXES 2,002 2,112 5,701 5,778
------------ ------------ ------------ ------------
NET INCOME $ 3,520 $ 2,231 $ 9,716 $ 7,498
============ ============ ============ ============
EARNINGS PER SHARE (Note 4)
Basic $ 0.31 $ 0.20 $ 0.86 $ 0.68
============ ============ ============ ============
Diluted $ 0.30 $ 0.20 $ 0.82 $ 0.66
============ ============ ============ ============
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING
Basic 11,353 11,110 11,322 11,081
============ ============ ============ ============
Diluted 11,890 11,418 11,858 11,389
============ ============ ============ ============
DIVIDENDS PER SHARE $ 0.09 $ 0.09 $ 0.27 $ 0.27
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these statements.
3
<PAGE>
WOODHEAD INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in Thousands; unaudited)
<TABLE>
<CAPTION>
Nine months ended
------------------------------
7/1/00 7/3/99
------------ ------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income for the period $ 9,716 $ 7,498
Adjustments to reconcile net income to net cash flows from operating
activities:
Depreciation & Amortization 7,862 7,763
(Increase) Decrease in:
Accounts receivable (5,371) (3,163)
Inventories (763) (2,195)
Prepaid expenses (39) 551
Deferred income taxes and other assets 1,359 (1,598)
Increase (Decrease) in:
Accounts payable 888 (1,546)
Accrued expenses 3,620 (1,555)
Income taxes payable (1,168) 1,363
Other liabilities 8 --
------------ ------------
Net Cash flows from operating actitivies $ 16,112 $ 7,118
------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property, plant & equipment $ (5,110) $ (6,290)
Retirements or sales of property, plant & equipment 797 2
Purchase of equity securities (1,925) --
------------ ------------
Net cash used for investing activities $ (6,238) $ (6,288)
------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES
Decrease in short-term debt $ (123) $ --
Decrease in long-term debt (2,059) (2,700)
Sales of Stock 876 791
Dividend payments (3,057) (2,992)
------------ ------------
Net cash used for financing activities $ (4,363) $ (4,901)
------------ ------------
EFFECT OF EXCHANGE RATES $ (97) $ 1,637
------------ ------------
NET INCREASE (DECREASE) IN CASH & SHORT - TERM SECURITIES $ 5,414 $ (2,434)
============ ============
Cash and short-term securities at the beginning of the period $ 1,425 $ 2,923
------------ ------------
Cash and short-term securities at the end of the period $ 6,839 $ 489
============ ============
SUPPLEMENTAL CASH FLOW DATA
---------------------------
Cash paid during the period for:
Interest $ 1,665 $ 1,969
Income taxes $ 6,657 $ 4,663
</TABLE>
The accompanying notes are an integral part of these statements.
4
<PAGE>
WOODHEAD INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Amounts in thousands; unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months ended
------------------------------ ------------------------------
7/1/00 7/3/99 7/1/00 7/3/99
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
NET INCOME $ 3,520 $ 2,231 $ 9,716 $ 7,498
OTHER COMPREHENSIVE INCOME
Accumulated foreign currency translation
adjustment, before tax (1,019) (496) (3,034) (2,081)
Income tax (expense) benefit related to
other comprehensive income -- -- -- --
------------ ------------ ------------ ------------
COMPREHENSIVE INCOME, NET OF TAX $ 2,501 $ 1,735 $ 6,682 $ 5,417
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these statements.
5
<PAGE>
WOODHEAD INDUSTRIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
July 1, 2000
(Unaudited)
1. The Consolidated Balance Sheets at July 1, 2000, and October 2, 1999, and
the Condensed Consolidated Statements of Income and the Consolidated
Statements of Cash Flows and Comprehensive Income for the periods ended
July 1, 2000, and July 3, 1999, reflect, in the opinion of the Company, all
adjustments necessary to present fairly the financial position for such
periods. All such adjustments were of a normal recurring nature. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to SEC rules and
regulations, although the Company believes that the disclosures are
adequate to make the information presented not misleading. It is suggested
that these condensed consolidated financial statements be read in
conjunction with the consolidated financial statements and notes thereto
included in the Company's latest Annual Report on Form 10-K.
2. The results of operations for the 3 and 9 months periods ended July 1, 2000
are not necessarily indicative of the results to be expected for the full
year.
3. The breakdown of raw materials, work-in-process, and finished goods
inventories at July 1, 2000, and October 2, 1999, is as follows:
(Amounts in Thousands)
-----------------------
7/1/00 10/2/99
--------- ---------
Raw Materials $ 14,894 $ 14,801
Work-in-process and finished goods 13,749 13,663
--------- ---------
Inventories before LIFO reserve $ 28,643 $ 28,464
Less: Reserve to reduce Inventory to LIFO (4,599) (4,365)
--------- ---------
Inventories, net $ 24,044 $ 24,099
========= =========
4. Earnings per share are based upon the weighted average number of common
shares outstanding for the basic calculation (11,353,000 and 11,322,000 for
the quarter and nine months ended July 1, 2000, respectively, and
11,110,000 and 11,081,000 for the quarter and nine months ended July 3,
1999, respectively) and the weighted average number of common shares
outstanding plus dilutive common stock options for the diluted calculation
(11,890,000 and 11,858,000 for the quarter and nine months ended July 1,
2000, respectively, and 11,418,000 and 11,389,000 for the quarter and nine
months ended July 3, 1999, respectively).
5. Authorized stock is 40,000,000 shares consisting of 10,000,000 shares of
preferred stock, par value $.01 per share, and 30,000,000 shares of common
stock, par value $l.00 per share. No shares of preferred stock have been
issued. Common shares outstanding at July 1, 2000 and October 2, 1999 were
11,371,000 and 11,237,000, respectively.
6. Certain amounts in the prior period financial statements have been
reclassified to conform with the current period presentation.
6
<PAGE>
7. Segment and geographic data
THREE MONTHS
<TABLE>
<CAPTION>
Net Sales Income from Operations
----------------------------- ----------------------------
Three Months Ended Three Months Ended
----------------------------- ----------------------------
7/1/00 7/3/99 7/1/00 7/3/99
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Industrial Communications
and Connectivity Products $ 32,925 $ 26,894 $ 4,684 $ 2,915
Electrical Safety &
Specialty Products 17,037 16,296 2,507 2,733
Corporate and other (588) (434)
------------ ------------ ------------ ------------
Total $ 49,962 $ 43,190 $ 6,603 $ 5,214
============ ============ ============ ============
<CAPTION>
Total Assets Depreciation and Amortization
----------------------------- ----------------------------
As of Three Months Ended
----------------------------- ----------------------------
7/1/00 10/2/99 7/1/00 7/3/99
------------ ------------ ------------ ------------
Industrial Communications
and Connectivity Products $ 123,588 $ 120,972 $ 1,855 $ 1,819
Electrical Safety &
Specialty Products 39,893 34,431 686 673
Corporate and other (1,269) 2,238 52 41
------------ ------------ ------------ ------------
Total $ 162,212 $ 157,641 $ 2,593 $ 2,533
============ ============ ============ ============
<CAPTION>
Three Months Ended
----------------------------
Reconciliation of Income from Operations to Net Income 7/1/00 7/3/99
--------------------------------------------------------------------- ------------ ------------
Income from operations $ 6,603 $ 5,214
Less: Interest expense, net (742) (882)
Other income (expense), net (339) 11
Income taxes (2,002) (2,112)
------------ ------------
Net Income $ 3,520 $ 2,231
============ ============
</TABLE>
Geographic Data
<TABLE>
<CAPTION>
Net Sales Total Assets
---------------------------- ----------------------------
Three Months Ended As of
---------------------------- ----------------------------
7/1/00 7/3/99 7/1/00 10/2/99
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
United States $ 30,965 $ 25,071 $ 66,940 $ 58,447
Canada 6,296 6,502 38,381 39,140
Italy 33,231 34,888
All other countries 12,701 11,617 23,660 25,166
------------ ------------ ------------ ------------
Total $ 49,962 $ 43,190 $ 162,212 $ 157,641
============ ============ ============ ============
</TABLE>
7
<PAGE>
NINE MONTHS
<TABLE>
<CAPTION>
Net Sales Income from Operations
----------------------------- ----------------------------
Nine Months Ended Nine Months Ended
----------------------------- ----------------------------
7/1/00 7/3/99 7/1/00 7/3/99
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Industrial Communications
and Connectivity Products $ 93,141 $ 76,150 $ 11,978 $ 7,702
Electrical Safety &
Specialty Products 51,452 50,344 8,533 8,548
Corporate and other (2,141) (767)
------------ ------------ ------------ ------------
Total $ 144,593 $ 126,494 $ 18,370 $ 15,483
============ ============ ============ ============
<CAPTION>
Total Assets Depreciation and Amortization
----------------------------- ----------------------------
As of Nine Months ended
----------------------------- ----------------------------
7/1/00 10/2/99 7/1/00 7/3/99
------------ ------------ ------------ ------------
Industrial Communications
and Connectivity Products $ 123,588 $ 120,972 $ 5,663 $ 5,665
Electrical Safety &
Specialty Products 39,893 34,431 2,050 2,095
Corporate and other (1,269) 2,238 149 103
------------ ------------ ------------ ------------
Total $ 162,212 $ 157,641 $ 7,862 $ 7,763
============ ============ ============ ============
<CAPTION>
Nine Months Ended
----------------------------
Reconciliation of Income from Operations to Net Income 7/1/00 7/3/99
--------------------------------------------------------------------- ------------ ------------
Income from operations $ 18,370 $ 15,483
Less: Interest income (expense), net (2,260) (2,589)
Other income (expense), net (693) 382
Income taxes (5,701) (5,778)
------------ ------------
Net Income $ 9,716 $ 7,498
============ ============
</TABLE>
Geographic Data
<TABLE>
<CAPTION>
Net Sales Total Assets
----------------------------- ----------------------------
Nine Months Ended As of
----------------------------- ----------------------------
7/1/00 7/3/99 7/1/00 10/2/99
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
United States $ 88,440 $ 73,462 $ 66,940 $ 58,447
Canada 18,881 16,671 38,381 39,140
Italy 33,231 34,888
All other countries 37,272 36,361 23,660 25,166
------------ ------------ ------------ ------------
Total $ 144,593 $ 126,494 $ 162,212 $ 157,641
============ ============ ============ ============
</TABLE>
8
<PAGE>
PART I
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF
OPERATIONS AND FINANCIAL POSITION
THIRD QUARTER 2000 RESULTS COMPARED WITH THIRD QUARTER 1999 RESULTS
Sales for the third quarter rose 16 percent to $50.0 million from $43.2
million reported for the same period of fiscal 1999. The continued effectiveness
of the Company's connectivity growth strategy was clearly demonstrated in a 22
percent increase in global sales of the Industrial Communications and
Connectivity Products segment of our business to $32.9 million. Sales of this
segment represented 66 percent of total sales, compared with 62 percent in the
same quarter last year. Sales of connectivity products rose 29 percent in North
America, reflecting ongoing strength in major capital investments in the
automotive, machine tool, and material-handling industries served by our OEM
customers. Sales of the Company's Electrical Safety & Specialty Products segment
grew 5 percent in North America, but declined in Europe where the economic
climate for infrastructure development was less favorable. The backlog at the
end of the quarter was $18.0 million compared with $12.4 million at the end of
last fiscal year, and $12.2 million reported a year ago.
Gross profit for the quarter increased by 12 percent to $20.9 million
from $18.6 million for the third quarter of fiscal 1999. Gross profit margins
decreased slightly to 41.8 percent of net sales from 43.0 percent last year,
primarily due to product mix in our Electrical Safety & Specialty Products
segment.
Operating expenses increased by 7 percent to $14.3 million from $13.3
million; as a percentage of net sales operating expenses declined to 28.5
percent from 30.9 percent in the third quarter of 1999.
Income from operations for the Industrial Communications and
Connectivity Products segment rose 61 percent to $4.7 million as a result of the
increase in sales and good operating controls. Income from operations for our
Electrical Safety & Specialty Products segment was down 8 percent at $2.5
million, reflecting a product mix change from the prior year.
Although interest expense decreased compared with the third quarter of
last year, total other expenses increased due the negative impact this year of
foreign exchange.
Net income was $3.5 million, a 58 percent increase over the $2.2
million reported for the same period last year. Diluted earnings per share were
$0.30 compared with $0.20 in the third quarter of last year.
FINANCIAL POSITION
Working capital increased by $3.8 million during the quarter ended July
1, 2000. The current ratio of 2.6 to 1 for the quarter increased slightly from
the end of last year. Long-term debt decreased to $45.0 million from $47.l
million at year-end resulting in a debt to total capitalization (short and
long-term debt plus equity) ratio of 34.1 percent, down from 36.4 percent at
year-end.
Return on assets increased to 8.3 percent from 1.8 percent, and return
on equity increased to 15.9 percent from 3.3 percent for the comparable
4-quarter periods ending July 1, 2000, and July 3, 1999, respectively. The
increases in return on assets and return on equity were due to the absence of
certain charges, which
9
<PAGE>
were included in the calculations for the 4-quarter period ending July 3, 1999,
as well as increased profitability. Other assets increased due to the investment
in Symphony Systems, and an unrealized foreign exchange gain related to the Lire
swap. The Company is in compliance with all of its debt covenants. Cash flows
from operating activities increased by 126 percent to $16.1 million for the 9
months ending July 1, 2000. The effective tax rate for the third quarter
declined to 36 percent from 49 percent last year due to a lower effective
foreign tax rate and higher R&D tax credits. Looking forward, internal cash flow
is expected to be more than adequate to fund operating requirements in 2000, and
significant borrowing is available, should the need arise.
OTHER
The Company is party to an environmental matter, which obligates it to
investigate, remediate or mitigate the effects on the environment of the release
of certain substances at one of the Company's facilities. For additional
information concerning the environmental matter, see "Part II - Other
Information: Item 1 - Legal Proceedings".
FORWARD-LOOKING STATEMENTS
Certain statements contained herein constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements involve numerous assumptions, known and
unknown risks, uncertainties and other factors, which may cause actual and
future performance or achievements of the Company to be materially different
from any future results, performance or achievements expressed or implied by
such forward-looking statements. Such factors include: achieving sales levels to
fulfill revenue expectations; the absence of presently unexpected costs or
charges, certain of which may be outside the control of the Company; general
economic and business conditions; competition; and other factors described in
the Company's SEC filings.
PART I
ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company, as a result of its global operating activities, is exposed
to changes in foreign currency exchange rates, which may adversely affect its
results of operations and financial condition. In seeking to minimize the risks
and/or costs associated with such activities, the Company manages exposure to
changes in foreign currency exchange rates through its regular operating
activities and, when deemed appropriate, through the use of derivative financial
instruments.
The Company uses financial instruments to selectively hedge and thereby
attempts to reduce its overall exposure to the effects of foreign currency
fluctuations. The Company does not use derivative financial instruments for
speculative purposes. The Company uses foreign currency forward and swap
contracts to hedge a portion of the currency risks of transactions denominated
in foreign currencies. Gains and losses on these foreign currency hedges are
generally offset by corresponding losses and gains on the underlying
transactions.
In 1998 the Company entered into a foreign currency swap agreement with
an AA-rated counter party to hedge a portion of its investment in its Italian
subsidiary. Under the terms of the agreement, the Company will swap 35.52
million Lire for 20.0 million U.S. Dollars amortized over 8 years. In addition,
the contract provides for the Company to make annual interest payments of 6.50%
on the outstanding Lire balance, while receiving 7.43% on the outstanding Dollar
balance. Due to the fact that this contract is an
10
<PAGE>
effective hedge of an investment in a foreign operation, any gain or loss on the
contract is recorded directly to other comprehensive income in Stockholders'
investment.
The following table indicates the values to be exchanged over the next
5 years relating to the Lire swap:
(Amounts in thousands)
Amortizing Outstanding Amortizing Outstanding
Date Amount USD Notional USD Amount ITL Notional ITL
---------- ------------ -------------- -------------- ----------------
9/30/00 $ 2,000 $ 17,000 ITL 3,552,000 ITL 30,192,000
9/30/01 3,000 14,000 5,328,000 24,864,000
9/30/02 3,000 11,000 5,328,000 19,536,000
9/30/03 3,000 8,000 5,328,000 14,208,000
9/30/04 3,000 5,000 5,328,000 8,880,000
Thereafter $ 5,000 $ -- ITL 8,880,000 ITL --
11
<PAGE>
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
The Company is subject to federal and state hazardous substance cleanup
laws that impose liability for the costs of cleaning up contamination resulting
from past spills, disposal or other releases of hazardous substances. In this
regard, the Company has incurred, and expects to incur, assessment, remediation
and related costs at one of the Company's facilities. In 1991, the Company
reported to state regulators a release at that site from an underground storage
tank ("UST"). The UST and certain contaminated soil subsequently were removed
and disposed of at an off-site disposal facility. The Company's independent
environmental consultant has been conducting an investigation of soil and
groundwater at the site with oversight by the state Department of Environmental
Quality ("DEQ"). The investigation indicates that additional soil and
groundwater at the site have been impaired by chlorinated solvents, including
tetrachloroethane and trichloroethylene, and other compounds. Also, the Company
learned that a portion of the site had been used as a disposal area by the
previous owners of the site. The Company's consultant has remediated the soils
in this area but believes that it is a major source of contamination of
groundwater, both on-site and off-site. In addition, the investigation of the
site indicates that the groundwater contaminants have migrated off-site. The
Company has implemented a groundwater remediation system for the on-site
contamination. The Company continues to monitor and analyze conditions to
determine the continued efficacy of the system. The Company also continues to
analyze remedial alternatives for the off-site groundwater contamination and is
reviewing these alternatives with the DEQ. The Company continues to investigate
the extent of other sources of contamination in addition to the removed UST and
the above-referenced disposal area, including possible evidence of past or
current releases by others in the vicinity around the Company's facilities.
The Company's consultant estimated, that a minimum of approximately
$1,659,000 of investigation and remediation expenses remain to be incurred, both
on-site and off-site. The Company has a reserve for such purposes. The Company
has filed a complaint in federal district court seeking contribution from the
previous owners of the site for the cost of the investigation and remediation of
the site. Also, the Company is evaluating similar claims against various
insurers. The consultant's cost estimate was based on a review of currently
available data and assumptions concerning the extent of contamination,
geological conditions, and the costs and effectiveness of certain treatment
technologies. The cost estimate continues to be subject to substantial
uncertainty because of the extent of the contamination area, the variety and
nature of geological conditions throughout the contamination area, changes in
remediation technology, and ongoing DEQ feedback. The Company is continuing to
monitor the conditions at the site and will adjust its reserve if necessary. The
Company may incur significant additional assessment, remediation and related
costs at the site, and such costs could materially and adversely affect the
Company's consolidated net income for the period in which such costs are
incurred. At this time, the Company, however, cannot estimate the time or
potential magnitude of such costs, if any.
12
<PAGE>
PART II - OTHER INFORMATION
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
PART I EXHIBITS
(11) Computation of earnings per share
(27) Financial data schedule (Electronic filings only)
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.
WOODHEAD INDUSTRIES, INC.
/s/ Joseph P. Nogal 8/10/00
-----------------------------------------------
Joseph P. Nogal Date
Vice President, Treasurer/Controller
(Chief Accounting Officer)
13
