<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter Ended March 31, 1999
Commission file number 1-1941
BETHLEHEM STEEL CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 24-0526133
(State of incorporation) (I.R.S. Employer Identification No.)
1170 Eighth Avenue
BETHLEHEM, PENNSYLVANIA 18016-7699
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (610) 694-2424
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
--- ---
Number of Shares of Common Stock Outstanding as of May 10, 1999: 130,489,275
-----------
<PAGE> 2
BETHLEHEM STEEL CORPORATION AND CONSOLIDATED SUBSIDIARIES
INDEX
Page No.
--------
PART I. Financial Information
Consolidated Statements of Income-
Three Months Ended March 31, 1999
and 1998 (unaudited). . . . . . . . . . . . . . . . . . . . . . 2
Consolidated Balance Sheets-
March 31, 1999 (unaudited), December 31, 1998
and March 31, 1998 (unaudited). . . . . . . . . . . . . . . . . 3
Consolidated Statements of Cash Flows-
Three Months Ended March 31, 1999
and 1998 (unaudited). . . . . . . . . . . . . . . . . . . . . . 4
Notes to Consolidated Financial Statements (unaudited) . . . . . . . 5
Management's Discussion and Analysis of Results of
Operations and Financial Condition. . . . . . . . . . . . . . . 6
PART II. Other Information
Item 1. Legal Proceedings. . . . . . . . . . . . . . . . . . . 11
Item 4. Submission of Matters to a Vote of Security Holders. . 12
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . 13
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
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<PAGE> 3
Bethlehem Steel Corporation
CONSOLIDATED STATEMENTS OF INCOME
(dollars and shares in millions, except per share data)
(unaudited)
<TABLE> <C> <C>
<S>
Three Months Ended
March 31
----------------------
1999 1998
--------- ---------
Net Sales $ 959.5 $1,132.5
--------- ---------
Costs and Expenses:
Cost of sales 888.4 957.0
Depreciation and amortization 61.2 59.8
Selling, administration and general expense 29.4 25.3
--------- ---------
Total Costs and Expenses 979.0 1,042.1
--------- ---------
Income (Loss) from Operations (19.5) 90.4
Financing Income (Expense):
Interest and other financing costs (13.9) (11.6)
Interest and other income 2.3 3.3
--------- ---------
Income (Loss) before Income Taxes (31.1) 82.1
Benefit (Provision) for Income Taxes 5.5 (13.5)
--------- ---------
Net Income (Loss) (25.6) 68.6
Dividends on Preferred and Preference Stock 10.3 10.5
--------- ---------
Net Income (Loss) Applicable to Common Stock $ (35.9) $ 58.1
========= =========
Net Income (Loss) per Common Share:
Basic $ (0.28) $ 0.51
Diluted $ (0.28) $ 0.49
Average Shares Outstanding:
Basic 129.7 113.1
Diluted 129.7 127.8
Additional Data
Steel products shipped (thousands of net tons) 2,003 2,221
Raw steel produced (thousands of net tons) 2,529 2,487
</TABLE>
The accompanying Notes are an integral part of the Consolidated Financial
Statements.
- 2 -
<PAGE> 4
Bethlehem Steel Corporation
CONSOLIDATED BALANCE SHEETS
(dollars in millions)
ASSETS
<TABLE>
<S> <C> <C> <C>
March 31 March 31
1999 December 31 1998
(unaudited) 1998 (unaudited)
----------- ----------- -----------
Current Assets:
Cash and cash equivalents $ 84.7 $ 137.8 $ 287.2
Receivables, less allowances 310.5 307.2 307.4
Inventories:
Raw materials 284.3 319.9 296.4
Finished and semifinished 744.0 720.7 574.7
--------- --------- ---------
1,028.3 1,040.6 871.1
Other current assets 8.2 9.2 10.9
--------- --------- ---------
Total Current Assets 1,431.7 1,494.8 1,476.6
Investments and Miscellaneous Assets 90.4 98.0 99.9
Property, Plant and Equipment,
less accumulated depreciation of
$4,170.7, $4,119.4, and $4,145.4 2,678.2 2,655.7 2,353.9
Deferred Income Tax Asset - net 925.5 920.0 867.0
Net Assets of Discontinued Stainless
Operations (Note 3) 25.0 100.0 -
Goodwill 350.0 353.0 -
--------- --------- ---------
Total Assets $5,500.8 $5,621.5 $4,797.4
========= ========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 380.2 $ 417.9 $ 361.0
Accrued employment costs 280.2 307.7 295.1
Accrued taxes 58.3 53.4 53.0
Debt 48.8 44.4 44.4
Other current liabilities 161.4 161.8 120.8
--------- --------- ---------
Total Current Liabilities 928.9 985.2 874.3
Pension Liability 420.1 415.0 456.0
Postretirement Benefits Other Than Pensions 1,635.0 1,630.0 1,436.3
Long-term Debt 599.4 627.7 427.5
Deferred Gain on Sales 131.3 136.0 -
Other Long-term Liabilities 330.4 338.1 328.8
Stockholders' Equity:
Preferred Stock 11.6 11.6 11.6
Preference Stock 2.2 2.2 2.3
Common Stock 132.5 132.2 115.3
Common Stock held in treasury at cost (60.5) (60.3) (60.1)
Additional paid-in capital 1,983.3 1,991.6 1,844.7
Accumulated deficit (613.4) (587.8) (639.3)
--------- --------- ---------
Total Stockholders' Equity 1,455.7 1,489.5 1,274.5
--------- --------- ---------
Total Liabilities and Stockholders' Equity $5,500.8 $5,621.5 $4,797.4
========= ========= =========
</TABLE>
The accompanying Notes are an integral part of the Consolidated Financial
Statements.
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<PAGE> 5
Bethlehem Steel Corporation
CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in millions)
(unaudited)
<TABLE>
<S> <C> <C>
Three Months Ended
March 31
----------------------
1999 1998
--------- ---------
Operating Activities:
Net income (loss) $ (25.6) $ 68.6
Adjustments for items not affecting
cash from operating activities:
Depreciation and amortization 61.2 59.8
Deferred income taxes (5.5) 13.0
Other - net 1.0 4.4
Working capital (excluding financing and
investing activities):
Receivables - operating (44.4) (1.4)
Receivables - sold 40.0 -
Inventories 12.3 22.7
Accounts payable (37.7) (10.1)
Employment costs and other (16.6) (26.7)
--------- ---------
Cash Provided from (Used for) Operations
before Pension Activities (15.3) 130.3
Pension Activities:
Pension expense 10.0 21.0
Pension funding (5.3) (5.0)
--------- ---------
Cash Provided from (Used for) Continuing
Operating Activities (10.6) 146.3
--------- ---------
Cash Provided from Operating Activities of
Discontinued Stainless Operations (Note 3) 0.1 -
--------- ---------
Investing Activities:
Capital expenditures (82.6) (61.2)
Payments related to the purchase of
Lukens (Note 3) (3.6) -
Cash proceeds from asset sales and other 82.6 2.3
--------- ---------
Cash Used for Investing Activities (3.6) (58.9)
--------- ---------
Financing Activities:
Borrowings 0.7 0.2
Debt payments (24.1) (21.5)
Cash dividends paid (10.1) (10.1)
Other payments (5.5) (21.2)
--------- ---------
Cash Used for Financing Activities (39.0) (52.6)
--------- ---------
Net Increase (Decrease) in Cash and Cash Equivalents (53.1) 34.8
Cash and Cash Equivalents - Beginning of Period 137.8 252.4
--------- ---------
- End of Period $ 84.7 $ 287.2
========= =========
Supplemental Cash Payment Information:
Interest, net of amount capitalized $ 21.6 $ 16.1
Income taxes paid $ 0.1 $ 3.5
</TABLE>
The accompanying Notes are an integral part of the Consolidated Financial
Statements.
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<PAGE> 6
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. The Consolidated Financial Statements as of and for the three month periods
ended March 31, 1999 and 1998 were not audited. However, in Management's
opinion, the information reflects all adjustments necessary for a fair
statement of the results for the periods presented. Management believes all
adjustments were of a normal and recurring nature.
2. These Consolidated Financial Statements should be read together with the
1998 audited financial statements in Bethlehem's Annual Report on Form 10-K
filed with the Securities and Exchange Commission.
3. On May 29, 1998, Bethlehem acquired all of the outstanding capital stock of
Lukens Inc. The aggregate purchase price of $560.6 million comprises cash of
$327.8 million, the issuance of 15.1 million shares of Bethlehem common stock
valued at $184.8 million, and transaction related costs of $48.0 million. $3.6
million of the transaction related costs were paid during the first quarter of
1999. The transaction was accounted for as a purchase and, accordingly,
Lukens' results are included in the Consolidated Financial Statements from the
date of acquisition.
The fair value (in millions) of the assets acquired and the liabilities assumed
is as follows:
Current assets $ 184.7
Property, plant and equipment 277.3
Net assets of discontinued stainless operations 310.0
Deferred tax asset, other 70.5
Goodwill 360.0
Current liabilities (113.5)
Pension and other postretirement benefit liabilities (220.0)
Debt (268.5)
Other long-term liabilities (39.9)
---------
Purchase price, net of cash acquired $ 560.6
=========
In February 1999, Bethlehem completed the sale of the stainless
distribution business, Washington Specialty Metals Corporation for about $70
million. In April 1999, Bethlehem signed an agreement to sell the stainless
sheet operations in Massillon, Ohio and Washington, Pennsylvania. The
stainless and distribution businesses were acquired with the purchase of Lukens
Inc. and are being accounted for as discontinued operations. Income or losses
from these operations are not included in Bethlehem's operating results. Since
the date of acquisition, these operations have incurred operating losses of
about $32 million. The net assets of these operations are shown separately on
the balance sheet and consist primarily of property, plant and equipment and
working capital.
Bethlehem will finalize all purchase accounting adjustments upon the sale
of the stainless sheet operations described above. Any adjustments are not
expected to materially affect the recorded values of the assets acquired or
liabilities assumed, including the recorded amount of goodwill.
The unaudited first quarter 1998 pro forma combined results (excluding
stainless) as if Lukens had been acquired at the beginning of 1998 are
estimated to be (dollars in millions, except per share data):
Net Sales $1,271.9
Income from Operations 100.6
Net Income 72.4
Net Income per Share:
--------------------
Basic $ .48
Diluted .47
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<PAGE> 7
MANAGEMENT'S DISCUSSION AND
ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION
REVIEW OF RESULTS:
FIRST QUARTER 1999 - FIRST QUARTER 1998
We reported a net loss of $26 million, or a net loss of $.28
per diluted share, for the first quarter of 1999 compared with net income of
$69 million, or net income of $.49 per diluted share, for the first quarter of
1998. Sales for the first quarter of 1999 were $960 million compared with
$1.13 billion for the first quarter of 1998.
OPERATING RESULTS
Our loss from operations was $20 million for the first quarter of 1999
compared with income from operations of $90 million for the first quarter of
1998. First quarter 1999 operating results declined from a year ago due to
lower realized prices and shipments resulting primarily from high levels of
unfairly traded steel imports. Steel shipments of about 2 million net tons for
the first quarter of 1999 were lower than the 2.2 million net tons shipped in
the first quarter of 1998. Lower shipments at Burns Harbor, Sparrows Point and
Pennsylvania Steel Technologies, Inc. were partially offset by additional
shipments resulting from our acquisition of Lukens.
First quarter 1999 operating results declined somewhat from the fourth
quarter of 1998 principally due to lower realized prices which were nearly
offset by lower costs.
LIQUIDITY AND CAPITAL STRUCTURE
At March 31, 1999, total liquidity, comprising cash, cash equivalents
and funds available under our bank credit arrangement, totaled $419 million
compared with $479 million at December 31, 1998.
During the first quarter of 1999, we completed the sale of our
stainless distribution business, Washington Specialty Metals Corporation, to
Ryerson Tull, Inc. for about $70 million. On April 7, 1999, we signed a
letter of intent to sell the remaining stainless operations of Washington Steel
to a company to be formed by SB International Inc., a steel marketing company
in Dallas, Texas, and Jindal Strips Ltd., part of the Jindal Organization of
India. The sale is expected to be completed in the second quarter of 1999.
For the first quarter of 1999, cash used for operations before pension
activities was $15 million compared with cash provided from operations before
pension activities of $130 million for the first quarter of 1998. Principal
uses of cash during the first
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<PAGE> 8
quarter of 1999 included capital expenditures of $83 million and debt
repayments of $24 million.
Major uses of cash for 1999 are expected to be capital expenditures of
about $450 million, debt payments of about $45 million and pension funding. We
plan to make a $60 million investment to convert one of Sparrows Point's two
caster strands into a wide slab caster. The wider slabs will be rolled into
wide, light gauge coiled plates on Bethlehem Lukens Plate's (BLP) Steckel mill
located at Conshohocken, Pennsylvania, and into long length, light gauge plates
for cut-to-length orders on BLP's 110-inch plate mill located at Burns Harbor,
with yields in excess of 90% and at significantly lower cost per ton of
shipment. This investment will also permit Sparrows Point to increase cast
slab production which will reduce a corporate requirement for purchased slabs.
We expect to maintain an adequate level of liquidity during 1999 with
cash provided from operations, proceeds from the sale of assets, reductions in
working capital and available funds under our credit arrangement.
INTERNATIONAL STEEL TRADE
The legal, public affairs and governmental efforts being undertaken
jointly by the steel industry and the United Steelworkers have been helpful,
but the serious injury from unfairly traded imports continues. Imports are
down in some products from certain countries because of cases that had been
filed and the other actions being taken. There are increases in imports from
countries not covered by recent unfair trade cases, such as cold rolled, tin
mill and rail products, and the overall levels in all products are much too
high. We will continue to file appropriate legal actions and work with the
Administration and the Congress to restore fair trade in steel on a
comprehensive and lasting basis.
YEAR 2000
Problems created by the once common programming practice of storing
date information using only the last two digits to indicate the year will
impact all businesses and government organizations as we approach the year
2000. The scope of our Year 2000 Program includes both information technology
and non-information technology systems such as business and manufacturing
computer systems, personal computers, technical infrastructure, and facilities
as well as the Year 2000 readiness of our key suppliers, agents, service
providers and customers.
We have been actively working on resolving our Year 2000 problem for
over four years. The effort was initiated with a pilot project in late 1994
during which five percent of our business applications were converted to be
Year 2000 compliant. The pilot project allowed us to develop a methodology for
solving our Year 2000 problem as well
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<PAGE> 9
as a structure for effective management and timely correction of the problem
within our systems. The major elements of our program are inventory, risk
assessment, remediation, testing, and contingency planning.
In late 1997, we conducted a 45-day test of the operability and
inter-operability of all converted business applications for Business Unit and
Corporate systems as well as all operating system software in a full simulation
of the Year 2000. We reset the system clock for various dates and tested the
processing of date information before and after December 31, 1999, as well as
the processing of the Year 2000 as a leap year. This test was completed
successfully and validated our processes and methods for addressing our Year
2000 problem. Additional full-scale tests were conducted in December 1998,
January 1999, and March 1999 to test applications not evaluated during the 1997
test and the main frame applications obtained as part of our acquisition of
Lukens. The results of these additional tests were positive and reinforced our
approach for addressing the Year 2000 problem.
We have completed the inventory and risk assessment for Year 2000
components in all areas of our business. Our risk assessment showed that less
than 15% of our computer components needed to be fixed or replaced.
Remediation and testing of our business systems and technical infrastructure
are complete except for a few planned replacement systems and upgrades. For
our manufacturing and environmental (e.g. HVAC, security, etc.) operations, we
have completed or scheduled all remediation activities. A few replacement
systems are planned. In the end-user computing area, we have installed
hardware patches and standard software upgrades to most systems where
necessary. We are currently focusing on other personal computer software and
user-written applications, spreadsheets, and other end-user files. We are over
96% complete with the entire remediation effort. Remaining remediation and
testing will continue through June, 1999.
We continue to evaluate the readiness of our key suppliers and
customers. Starting in April 1998, we surveyed key suppliers, outside
processors, warehousers, and electronic data interchange trading partners. To
date, responses have been received from 93% of these suppliers. We have
implemented a procedure to confirm supplier compliance. Additionally, we have
received correspondence from over 600 key customers regarding their Year 2000
readiness and we will continue to review their readiness.
We will continue the development of Year 2000 contingency plans for
all areas of our business. Our contingency plans will address both internal
(staffing, computer systems, and inventory) and external (suppliers, service
providers, agents, and customers) risks. Strategies for eliminating internal
risk include the development of staffing plans for the Year 2000 roll-over,
backup and/or alternate procedures, and inventory levels based on customer and
supplier assessments. One of our strategies for reducing external risk is to
develop alternate plans for those vendors who will not be Year 2000 compliant
in significant areas. Our target is to develop contingency plans for critical
business processes during the first half of 1999.
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<PAGE> 10
The costs associated with our Year 2000 Program continue to be at
planned levels. The total estimated incremental cost of this activity is
approximately $7 million. The cost will continue to be charged to normal
operating expenses. We do not expect to incur any extraordinary charges
associated with the effort and no major information service projects have been
deferred because of our Year 2000 Program.
We believe that we are taking all reasonable steps to ensure our Year
2000 readiness. Our ability to meet our projected goals depends, to an extent,
on the Year 2000 readiness of our key suppliers and customers, the completion
of our final remediation and testing efforts and the successful development and
implementation of contingency plans. These and other unanticipated Year 2000
issues could have a material adverse effect on our results of operations or
financial condition.
DIVIDENDS
On April 28, 1999, our Board of Directors declared dividends of $1.25
per share on Bethlehem's $5.00 Cumulative Convertible Preferred Stock, $0.625
per share on Bethlehem's $2.50 Cumulative Convertible Preferred Stock and
$0.875 per share on Bethlehem's $3.50 Cumulative Convertible Preferred Stock,
each payable June 10, 1999, to holders of record on May 10, 1999. No dividend
was declared on Bethlehem's Common Stock.
OUTLOOK
The U.S. economy is continuing on a course of moderate and
sustainable growth and low inflation. We believe that steel consumption in the
U.S. will continue to be relatively strong at about the same level as last
year. We also believe that domestic industry shipments in 1999 will be about
100 million tons, slightly lower than the estimated 102 million tons shipped in
1998, as lower imports offset reductions in inventories.
Currently, we are seeing some improvement in our order entry.
However, unfairly traded imports continue and there is excess global steel
capacity, new domestic supply and continuing high levels of inventories in the
marketplace. Also, in early June we will begin a reline of our "L" blast
furnace at Sparrows Point which will have an adverse impact on our costs during
the second and third quarters of this year.
Our current labor agreements with the United Steelworkers of America
(USWA), covering USWA represented employees at Burns Harbor, Sparrows Point and
Pennsylvania Steel Technologies expire on August 1, 1999. We and U.S. Steel
have agreed to bargain with the USWA on a new basic labor agreement and have
commenced early negotiations.
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<PAGE> 11
While current business conditions remain very competitive, we believe
that strategically we are on the right path, and we are making steady progress
toward achieving our Vision to Be The Premier Steel Company.
FORWARD-LOOKING STATEMENTS
This release contains forward-looking statements. Our use of the
words "expect", "believe", "intent", "should", "plan" and similar words are
intended to identify these statements as forward-looking. In accordance with
the provisions of the Private Securities Litigation Reform Act of 1995,
reference is made to "Item 1 - Business - Forward-Looking Statements" of
Bethlehem's 1998 Annual Report on Form 10-K and to "Cautionary Statement" of
Bethlehem's Registration Statement on Form S-4 filed with the Securities and
Exchange Commission on April 24, 1998 for important factors that could cause
actual results to differ materially from those projected.
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<PAGE> 12
PART II. OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS.
Bethlehem, in the ordinary course of its business, is the subject of
various pending or threatened legal actions involving governmental agencies or
private interests. Bethlehem believes that any ultimate liability arising from
these actions should not have a material adverse effect on its consolidated
financial position at March 31, 1999.
Bethlehem does not have any material developments in legal proceedings
to report for the first quarter of 1999.
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<PAGE> 13
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The Annual Meeting of the Stockholders of Bethlehem was held on April
27, 1999.
The following nominees for director named in the Proxy Statement dated
March 12, 1999 were elected at the Meeting by the votes indicated:
<TABLE>
For Withheld
--- --------
<S> <C> <C>
Curtis H. Barnette 110,036,845 4,427,423
Benjamin R. Civiletti 109,526,160 4,938,108
Worley H. Clark 109,988,377 4,475,891
John B. Curcio 110,020,967 4,443,301
Lewis B. Kaden 109,528,269 4,935,999
Harry P. Kamen 110,087,399 4,376,869
William M. Landuyt 110,065,729 4,398,539
Robert McClements, Jr. 110,058,598 4,405,670
Gary L. Millenbruch 110,106,528 4,357,740
Roger P. Penny 109,990,777 4,473,491
Shirley D. Peterson 110,062,669 4,401,599
Dean P. Phypers 110,055,967 4,408,301
John F. Ruffle 110,102,974 4,361,294
</TABLE>
The votes in favor of the election of the nominees represent at least
95% of the shares voted for each of the nominees.
Ratification of the appointment of PricewaterhouseCoopers LLP as our
Independent Auditors was approved by the following vote:
For Against Abstentions
--- ------- -----------
Number of Shares 113,313,294 545,454 605,520
There were no broker non-votes with respect to any of these matters
voted upon at the Meeting.
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<PAGE> 14
Item 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits.
The following is an index of the exhibits included in this Report
on Form 10-Q:
11. Statement Regarding Computation of Earnings Per Share.
27. Financial Data Schedule.
(b) Reports on Form 8-K.
On January 19, 1999, Bethlehem filed a report on Form 8-K with the
Securities and Exchange Commission regarding an amendment to the terms of its
Stockholder Rights Plan.
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<PAGE> 15
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
Bethlehem Steel Corporation has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
Bethlehem Steel Corporation
(Registrant)
by
/s/ L. A. Arnett
----------------------------
L. A. Arnett
Vice President and
Controller (principal
accounting officer)
Date: May 14, 1999
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<PAGE> 16
EXHIBIT INDEX
The following is an index of the exhibits included in this Report:
Item
No. Exhibit
- ---- -------
11 Statement Regarding Computation of Earnings Per Share
27 Financial Data Schedule
- 15 -
<PAGE> 17
EXHIBIT (11)
BETHLEHEM STEEL CORPORATION
Statement Regarding Computation of Earnings Per Share
(dollars in millions and shares in thousands, except per share data)
<TABLE>
<S> <C> <C>
Three Months
Ended March 31
Basic Earnings Per Share 1999 1998
------------------------ ---- ----
Net Income (Loss) ($25.6) $68.6
Less Dividend Requirements:
$2.50 Preferred Dividend (2.5) (2.5)
$5.00 Preferred Dividend (3.1) (3.1)
$3.50 Preferred Dividend (4.5) (4.5)
5% Preference Dividend (0.2) (0.4)
-------- --------
Total Preferred and Preference Dividends (10.3) (10.5)
-------- --------
Net Income (Loss) Applicable to Common Stock ($35.9) $58.1
======== ========
Average Shares of Common Stock 129,670 113,116
Basic Earnings (Loss) Per Share ($0.28) $0.51
======== ========
Diluted Earnings Per Share
--------------------------
Net Income (Loss) ($25.6) $68.6
Less Dividend Requirements:
$2.50 Preferred Dividend (2.5) (2.5)
$5.00 Preferred Dividend (3.1) (3.1)
$3.50 Preferred Dividend (4.5) -
5% Preference Dividend (0.2) -
-------- --------
Net Income (Loss) Applicable to Common Stock ($35.9) $63.0
======== ========
Average Shares of Common Stock and Equivalents and
Other Potentially Dilutive Securities Outstanding:
Common Stock 129,670 113,116
Stock Options 51 137
$2.50 Preferred Stock * *
$5.00 Preferred Stock * *
$3.50 Preferred Stock * 12,255
5% Preference Stock * 2,294
-------- --------
Total 129,721 127,802
======== ========
Diluted Earnings (Loss) Per Share ($0.28) $0.49
======== ========
</TABLE>
* Antidilutive
<PAGE> 18
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 85
<SECURITIES> 0
<RECEIVABLES> 331
<ALLOWANCES> 20
<INVENTORY> 1028
<CURRENT-ASSETS> 8
<PP&E> 6849
<DEPRECIATION> 4171
<TOTAL-ASSETS> 5501
<CURRENT-LIABILITIES> 929
<BONDS> 599
0
14
<COMMON> 133
<OTHER-SE> 1309
<TOTAL-LIABILITY-AND-EQUITY> 5501
<SALES> 960
<TOTAL-REVENUES> 960
<CGS> 888
<TOTAL-COSTS> 979
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 14
<INCOME-PRETAX> (31)
<INCOME-TAX> (6)
<INCOME-CONTINUING> (26)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (36)
<EPS-PRIMARY> (0.28)
<EPS-DILUTED> (0.28)
</TABLE>
