UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter ended Commission file number
April 4, 1998 1-3246
BELL & HOWELL COMPANY
(Exact Name of Registrant as Specified in its Charter)
Delaware 36-3580106
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
5215 Old Orchard Road, Skokie, Illinois 60077-1076
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (847) 470-7100
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
The number of shares of the Registrant's Common Stock, $.001
par value, outstanding as of May 8, 1998 was 23,431,375.
<PAGE>
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION PAGE
- ------ --------------------- ----
Item 1. Financial Statements
Consolidated Statements of Operations for
the Thirteen Weeks Ended April 4, 1998 and
March 29, 1997.................................. 1
Consolidated Balance Sheets - Assets at
April 4, 1998 and January 3, 1998 .............. 2
Consolidated Balance Sheets - Liabilities
and Shareholders' Equity at April 4, 1998
and January 3, 1998 ............................ 3
Consolidated Statements of Cash Flows
the Thirteen Weeks Ended April 4, 1998 and
March 29, 1997 ................................. 4
Notes to the Consolidated Financial
Statements ..................................... 5
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations ...................................... 8
PART II. OTHER INFORMATION
- ------- -----------------
Item 1. Legal Proceedings ................................ 13
Item 6. Exhibits and Reports on Form 8-K ................. 13
SIGNATURE PAGE .............................................. 14
<PAGE>
<TABLE>
Bell & Howell Company and Subsidiaries
Consolidated Statements of Operations
(Dollars and shares in thousands, except per share data)
(Unaudited)
<CAPTION>
Thirteen Weeks Ended
--------------------------
April 4, March 29,
1998 1997
--------- ---------
<S> <C> <C>
Net sales $ 201,374 $ 191,127
Operating costs and expenses:
Cost of sales 123,807 120,956
Research and development 9,160 9,162
Selling and administrative 55,741 46,532
-------- --------
Total operating costs and expenses 188,708 176,650
Operating income 12,666 14,477
Net interest expense:
Interest (income) (6,294) (5,012)
Interest expense 12,339 16,102
-------- --------
Net interest expense 6,045 11,090
Earnings from continuing operations
before income taxes and extraordinary items 6,621 3,387
Income tax expense 2,648 1,407
-------- --------
Earnings from continuing operations
before extraordinary items 3,973 1,980
Earnings (loss) from discontinued operations (726) 70
Extraordinary losses -- (905)
-------- --------
Net earnings $ 3,247 $ 1,145
======== ========
Net earnings per common share:
Basic:
Earnings from continuing operations
before extraordinary items $ 0.17 $ 0.11
Earnings (loss) from discontinued operations (0.03) --
Extraordinary losses -- (0.05)
-------- --------
Net earnings per common share $ 0.14 $ 0.06
======== ========
Diluted:
Earnings from continuing operations
before extraordinary items $ 0.17 $ 0.11
Earnings (loss) from discontinued operations (0.03) --
Extraordinary losses -- (0.05)
-------- --------
Net earnings per common share $ 0.14 $ 0.06
======== ========
Average number of common shares and equivalents outstanding:
Basic 23,422 18,315
Diluted 23,586 18,391
The accompanying Notes to the Consolidated Financial statements
are an integral part of these statements
</TABLE>
-1-
<PAGE>
<TABLE>
Bell & Howell Company and Subsidiaries
Consolidated Balance Sheets
(Dollars in thousands)
Assets
<CAPTION>
April 4, January 3,
1998 1998
----------- -----------
(Unaudited) (Audited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 4,263 $ 13,339
Accounts receivable, less allowance for doubtful
accounts of $6,797 and $7,068, respectively 183,388 198,228
Inventory 112,000 101,756
Other current assets 13,060 11,825
-------- --------
Total current assets 312,711 325,148
Property, plant and equipment, at cost 399,460 391,309
Accumulated depreciation (251,971) (241,655)
-------- --------
Net property, plant and equipment 147,489 149,654
Long-term receivables 49,894 66,625
Goodwill, net of accumulated amortization 208,303 202,730
Net assets of discontinued operations 12,479 20,470
Other assets 35,282 35,227
-------- --------
Total assets $ 766,158 $ 799,854
======== ========
The accompanying Notes to the Consolidated Financial Statements
are an integral part of these statements.
</TABLE>
-2-
<PAGE>
<TABLE>
Bell & Howell Company and Subsidiaries
Consolidated Balance Sheets
(Dollars and shares in thousands)
Liabilities and Shareholders' Equity
<CAPTION>
April 4, January 3,
1998 1998
------------ -------------
(Unaudited) (Audited)
<S> <C> <C>
Current liabilities:
Notes payable $ 7,504 $ 3,567
Current maturities of long-term debt 942 919
Accounts payable 67,654 75,089
Accrued expenses 61,793 66,446
Deferred income 167,631 175,504
-------- --------
Total current liabilities 305,524 321,525
Long-term liabilities:
Long-term debt 473,027 497,252
Other liabilities 49,190 45,625
-------- --------
Total long-term liabilities 522,217 542,877
Shareholders' equity:
Common Stock, $.001 par value, 23,432 shares issued
and 23,430 shares outstanding at April 4, 1998,
and 23,425 shares issued and 23,415 shares outstanding
at January 3, 1998 23 23
Capital surplus 138,810 138,660
Notes receivable from executives (1,895) (1,707)
Retained earnings (deficit) (195,064) (198,311)
Cumulative foreign exchange translation adjustments (3,386) (2,922)
Treasury stock (71) (291)
-------- --------
Total shareholders' equity (deficit) (61,583) (64,548)
Commitments and contingencies -- --
-------- --------
Total liabilities and shareholders' equity $ 766,158 $ 799,854
======== ========
The accompanying Notes to the Consolidated Financial Statements
are an integral part of these statements.
</TABLE>
-3-
<PAGE>
<TABLE>
Bell & Howell Company and Subsidiaries
Consolidated Statements of Cash Flows
(Dollars in thousands)
(Unaudited)
<CAPTION>
Thirteen Weeks Ended
---------------------------
April 4, March 29,
1998 1997
-------- --------
<S> <C> <C>
Operating Activities:
Net earnings from continuing operations
before extraordinary items $ 3,973 $ 1,980
Extraordinary losses -- (905)
Depreciation and amortization 13,826 14,477
Debt accretion -- 5,714
Changes in operating assets and liabilities:
Accounts receivable 15,843 33,595
Inventory (9,656) (35)
Other current assets (1,211) (843)
Long-term receivables 16,731 2,946
Income taxes 3,434 (809)
Accounts payable (7,659) (15,606)
Accrued expenses (7,580) (24,318)
Deferred income and other long-term liabilities (6,894) (9,933)
Other, net (3,848) (1,680)
------- -------
Net cash provided by continuing operations 16,959 4,583
Net cash provided (used) by discontinued operations 7,265 (18,711)
------- -------
Net cash provided by operating activities 24,224 (14,128)
Investing activities:
Expenditures for property, plant and equipment (8,214) (9,244)
Acquisitions (5,046) (2,298)
------- -------
Net cash used by investing activities (13,260) (11,542)
Financing activities:
Proceeds from short-term debt 4,886 1,853
Repayment of short-term debt (889) (2,647)
Proceeds from long-term debt 12,068 45,301
Repayment of long-term debt (36,270) (23,365)
Proceeds from Common Stock, net 210 565
------- -------
Net cash provided (used) by financing activities (19,995) 21,707
Effect of exchange rate changes on cash (45) (544)
------- -------
Increase (decrease) in cash and cash equivalents (9,076) (4,507)
Cash and cash equivalents, beginning of period 13,339 15,500
------- -------
Cash and cash equivalents, end of period $ 4,263 $ 10,993
======= =======
The accompanying Notes to the Consolidated Financial Statements
are an integral part of these statements.
</TABLE>
-4-
<PAGE>
Bell & Howell Company and Subsidiaries
Notes to the Consolidated Financial Statements
(Dollars and shares in thousands)
Note 1 - Basis of Presentation
The consolidated financial statements include the accounts
of Bell & Howell Company and its subsidiaries (collectively the
"Company") and have been prepared without independent audit,
except for the balance sheet data as of January 3, 1998.
In the opinion of the Company's management, the consolidated
financial statements include all adjustments necessary to present
fairly the information required to be set forth therein, and such
adjustments are of a normal and 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.
The Company's management believes, however, that the disclosures
are adequate to make the information presented not misleading.
These financial statements should be read in conjunction with the
Consolidated Financial Statements and the notes thereto included
in Bell & Howell Company's annual report for the fiscal year
ended January 3, 1998.
Note 2 - Significant Accounting Policies
Inventory. The Company uses the last-in, first-out (LIFO)
method of valuing the majority of its domestic inventory. Use of
the LIFO method is predicated on a determination of inventory
quantities and costs at the end of each fiscal year, and
therefore interim determinations of LIFO inventory values and
results of operations are by necessity based on management's
estimates of expected year-end inventory quantities and costs.
The excess of replacement cost over the LIFO values of inventory
was $4,064 at April 4, 1998, and January 3, 1998.
-5-
<PAGE>
Net Earnings per Common Share. Basic net earnings per
common share is computed by dividing net earnings by the weighted
average number of common shares outstanding during the period.
Diluted net earnings per common share is computed by dividing net
earnings by the weighted average number of common shares
outstanding during the period, and assumes the issuance of
additional common shares for all dilutive stock options
outstanding during the period. A reconciliation of the weighted
average number of common shares and equivalents outstanding in
the calculation of basic and diluted earnings per share for the
first quarter of 1998 and 1997 is shown in the table below:
<TABLE>
<CAPTION>
Thirteen Weeks Ended
--------------------------
April 4, March 29,
1998 1997
------ ------
<S> <C> <C>
Basic 23,422 18,315
Dilutive effect of stock options 164 76
------ ------
Diluted 23,586 18,391
====== ======
</TABLE>
Note 3 - Discontinued Operations
In December 1997, the Company adopted a plan to divest its
postal contracting business, and accordingly the operating
results and net assets of this business have been segregated from
continuing operations. The Consolidated Statements of Operations
separately reflect the earnings (after tax) of the postal
contracting business, which includes an allocation of the
Company's interest expense based on projected divesture proceeds.
The Consolidated Balance Sheets separately reflect the net assets
of the postal contracting business as a non-current asset.
Results from discontinued operations for the first quarter
of 1998 and 1997 are as follows:
<TABLE>
<CAPTION>
Thirteen Weeks Ended
--------------------------
April 4, March 29,
1998 1997
-------- --------
<S> <C> <C>
Net sales $ 3,325 $ 8,891
Earnings (loss) before income taxes (1,210) 117
Income tax expense/(benefit) (484) 47
------- -------
Earnings (loss) from discontinued operations $ (726) $ 70
======= =======
</TABLE>
-6-
<PAGE>
Note 4 - Extraordinary Losses
The extraordinary losses of $905 ($1,415 pretax) in the
first quarter of 1997 were comprised of the debt repurchase
premiums and write-off of unamortized debt issuance costs
associated with the repurchases of $15,598 (accreted value) of
the 11 1/2% Senior Discount Debentures and $600 of the 10 3/4%
Senior Subordinated Notes.
Note 5 - Comprehensive Income
In June of 1997, the Financial Accounting Standards Board
issued Statement of Financial Accounting Standard No. 130,
"Reporting Comprehensive Income", which is effective for
financial statements for reporting periods beginning after
December 15, 1997. This statement requires the disclosure of
comprehensive income. The components of comprehensive income for
the Company include net earnings and unrealized gains and losses
relating to the translation of foreign currency balance sheets.
Comprehensive income for the first quarter 1998 and 1997 was as
follows:
<TABLE>
<CAPTION>
Thirteen Weeks Ended
--------------------------
April 4, March 29,
1998 1997
-------- --------
<S> <C> <C>
Net earnings $ 3,247 $ 1,145
Other comprehensive income (loss):
Foreign currency translation adjustments (464) (2,269)
------- -------
Comprehensive income (loss) $ 2,783 $ (1,124)
======= =======
</TABLE>
The foreign currency translation adjustments do not impact
the Company's income tax expense.
-7-
<PAGE>
Item 2.
- ------
Management's Discussion and Analysis of
Financial Condition and Results of Operations
---------------------------------------------
This section should be read in conjunction with the
Consolidated Financial Statements of Bell & Howell Company and
Subsidiaries (collectively the "Company") and the notes thereto
included in the annual report for the year ended January 3, 1998.
Results of Operations
- ---------------------
First Quarter 1998 Compared to First Quarter 1997
- -------------------------------------------------
The Company's net sales increased $10.2 million, or 5%, to
$201.4 million in the first quarter of 1998. The increase
resulted from strong sales growth in the Information Distribution
segment as well as the transportation and vehicle business within
the Information Access segment. This was partially offset by a
stronger U.S. dollar and, within Information Access, lower sales
of production scanners and the impact of a strategic shift from a
direct retail sales channel to a more profitable wholesale sales
channel in the corporate portion of the education and library
business in the second half of 1997.
Information Access net sales increased $3.2 million, or 3%,
to $113.4 million in the first quarter of 1998. Within the
Information Access businesses, the Company provides access to
information in select vertical markets including the
transportation and vehicle, and education and library markets,
and also provides imaging solutions and components to financial
institutions, governmental agencies and other paper intensive
industries. Net sales to the transportation and vehicle market
increased $3.5 million, or 14%, to $29.4 million due to increased
sales of electronic parts catalogs and ancillary products to
automotive dealerships, and continued strong sales of dealer
management systems and electronic parts catalogs to powersports
dealerships. In addition to new systems placements, the Company
continued to experience strong sales of additional software
applications and high contract renewal rates related to
previously placed systems. Net sales to the education & library
market increased $.6 million, or 1%, to $43.6 million due to a
-8-
<PAGE>
growing electronic subscription base, which continued to reflect
strong sales of ProQuest Direct (the Company's on-line product
offering), and high renewal rates on existing products. While
the sales comparison to the prior year is adversely impacted as
the Company curtailed its direct sales efforts to the corporate
market (and now more profitably serves corporate libraries
through resellers like Dow Jones), sales of electronic content in
the core North American education and library market increased
15% over the prior year, as customers increasingly demand
electronic information solutions including on-line delivery. Net
sales of microfilm and paper products to the education and
library market increased modestly versus the prior year as
increased pricing more than offset lower unit volumes. Imaging
Solutions and Components net sales decreased $.9 million, or 2%,
to $40.4 million as increased sales of micrographic
equipment/service was more than offset by the aforementioned
lower sales of production scanners resulting from a softer
overall imaging market and a modified strategy related to the
level of inventory maintained in the distribution channel.
Information Distribution net sales increased $7.0 million,
or 9%, to $88.0 million in the first quarter of 1998, as a 14%
increase in sales to high volume mailers in North America was
partially offset by the impact of a stronger U.S. dollar and an
unusually strong first quarter in 1997 for sales in Japan.
Service revenues (which are primarily annuity-based and represent
49% of segment sales), increased $5.1 million, or 13%, to $43.1
million due to both an expanded customer base and increased
pricing.
The Company's cost of sales increased $2.9 million, or 2%,
to $123.8 million in the first quarter of 1998, with the gross
profit (net sales less cost of sales) percentage increasing by
1.8 percentage points to 38.5%. The higher gross profit
percentage in 1998 resulted from a more profitable
product/channel mix, improved manufacturing/service productivity,
and increased pricing.
Research and development expense of $9.2 million remained
constant with the prior year as the Company continued to invest
in new product offerings. Such investment primarily related to
the development of new electronic products for the education and
library market, new technology platforms for the transportation
-9-
<PAGE>
and vehicle market, enhanced versions of production scanners, and
new mail processing systems that are more electronic and software
oriented. The Company has continually positioned itself to take
advantage of new product/technology opportunities (with an
increased emphasis on software solutions) in each of its
businesses.
Selling and administrative expense increased $9.2 million,
or 20%, to $55.7 million in the first quarter of 1998 reflecting
the Company's increased investment in sales and marketing
resources, as well as increased distribution costs associated
with the higher sales volumes.
EBITDA (defined as operating income plus depreciation and
amortization) decreased $1.8 million, or 6%, to $26.4 million
in the first quarter of 1998, while operating income decreased
$1.8 million, or 13%, to $12.7 million.
Information Access EBITDA decreased $.6 million, or 3%,
to $23.0 million in the first quarter of 1998, as the slightly
higher sales volumes (which reflected the lower sales of
production scanners) and improved gross profit percentage
(reflecting a more profitable product mix with a greater
proportion of revenues related to software and publishing and a
lower proportion related to the sale of hardware), was more than
offset by increased operating expenses, which included severance
costs related to reducing the expense infrastructure.
Information Access operating income decreased $.7 million, or 6%,
to $11.5 million in the first quarter of 1998.
Information Distribution EBITDA decreased $.9 million, or
11%, to $6.9 million in the first quarter of 1998, as the
increased sales and improved gross profit percentage (also
reflecting a more profitable product mix with an emphasis on
software applications), was more than offset by increased
operating expenses which included increased research and
development costs for higher technology mail processing
systems/software. Personnel reductions (the severance costs for
which were reflected as a special charge in the fourth quarter of
1997) were implemented in the latter portion of the first quarter
of 1998, with a minimal expense benefit recognized to date.
Information Distribution operating income decreased $.8 million,
or 14%, to $4.9 million in the quarter of 1998.
-10-
<PAGE>
Corporate expenses (excluding depreciation and amortization)
increased $.3 million, or 10%, to $3.6 million in the first
quarter of 1998 as productivity improvements were more than
offset by inflationary/other cost increases.
Net interest expense decreased $5.0 million, or 45%, to $6.0
million in the first quarter of 1998, primarily reflecting the
impact of the Company's public offering of 5.0 million shares of
Common Stock in September 1997, the proceeds of which together
with borrowings under the Company's Credit Agreement were used to
redeem debt outstanding. Net interest income of Bell & Howell
Financial Services Company, the Company's financing subsidiary,
increased $.8 million to $2.7 million in the first quarter of
1998, primarily due to continued growth in the lease receivables
portfolio.
Income tax expense increased in the first quarter of 1998 as
a result of a higher level of pretax profit in the current year,
which was partially offset by a reduced income tax rate related
to the favorable settlement of certain prior year tax exposures.
As a result of changing market and competitive dynamics
within global government postal markets, as well as a review of
its future strategic focus, in December 1997 the Company adopted
a plan to divest its postal contracting business. Accordingly,
the operating results of this business have been segregated from
the Company's continuing operations, and are separately reported
as a discontinued operation in the financial statements. Net
sales for this business decreased $5.6 million to $3.3 million in
first quarter of 1998, with a net loss of $.7 million in the
first quarter of 1998 versus net income of $.1 million in the
prior year.
The extraordinary losses of $.9 million ($1.4 million
pretax) in the first quarter of 1997 were comprised of the debt
repurchase premiums and write-off of unamortized debt issuance
costs associated with the repurchases of $15.6 million (accreted
value) of the 11 1/2% Senior Discount Debentures and $.6 million
of the 10 3/4% Senior Subordinated Notes.
Cash provided by continuing operations increased $12.4
million to $17.0 million in the first quarter of 1998 primarily
due to decreased working capital requirements in the current
year. Cash provided by discontinued operations improved $26.0
million to $7.3 million in the first quarter of 1998 primarily
-11-
<PAGE>
due to reduced investment requirements related to international
postal contracts. As a result of the improved cash flow from
operations, which more than offset continued investments in
capital expenditures/acquisitions, debt (net of cash and cash
equivalents) decreased by $11.2 million to $477.2 million in the
first quarter of 1998.
Impact of the Year 2000
Over the past few years, the Company has been assessing the
impact on its products and computer systems of Year 2000 related
issues. In response to these assessments, which are ongoing, the
Company has implemented and is in the process of implementing
solutions for those products and systems that have date-related
deficiencies. Based on projects completed to date, and assuming
that remaining issues can be addressed as planned, management
believes that future costs relating to the Year 2000 issue will
not have a material adverse impact upon the consolidated
operations or financial condition of the Company.
Recently Issued Financial Accounting Standards
In June 1997, the Financial Accounting Standards Board
issued Statement of Financial Accounting Standards No. 131,
"Disclosures about Segments of an Enterprise and Related
Information." The Company is required to adopt this new standard
beginning with its fiscal 1998 annual financial statements. This
statement establishes standards for the way companies are to
report information about operating segments. It also establishes
standards for related disclosures about products and services,
geographic areas, and major customers. The Company is currently
evaluating the impact of this standard on its financial
statements.
In February 1998, the Financial Accounting Standard Board
issued Statement of Financial Accounting Standards No. 132,
"Employers' Disclosures about Pensions and Other Postretirement
Benefits." This statement revises employers' disclosures about
pension and other postretirement benefit plans, and will govern
the Company's disclosures related to its benefit plans beginning
with the fiscal 1998 annual financial statements.
-12-
<PAGE>
Part II. Other Information
- ------- -----------------
Item 1. Legal Proceedings.
- ------ -----------------
The Company is involved in various legal proceedings
incidental to its business. Management believes that the outcome
of such proceedings will not have a material adverse effect upon
the consolidated operations or financial condition of the
Company.
Item 6. Exhibits and Reports on Form 8-K.
- ------ --------------------------------
(a) Exhibits:
Index Number Description
------------ -----------
(27.1) Financial Data Schedule
(27.2) Restated Financial Data Schedule
Q1-97
(b) Reports on Form 8-K.
No reports on Form 8-K were filed for the thirteen weeks
ended April 4, 1998.
-13-
<PAGE>
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.
Date: May 12, 1998 BELL & HOWELL COMPANY
/s/ James P. Roemer
--------------------------
James P. Roemer
Chairman of the Board
of Directors, President and
Chief Executive Officer
/s/Nils A. Johansson
--------------------------
Nils A. Johansson
Executive Vice President,
Chief Financial Officer
and Director
-14-
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE COMPANY'S BALANCE SHEET AND STATEMENT OF OPERATIONS
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-02-1999
<PERIOD-END> APR-04-1998
<CASH> 4,263
<SECURITIES> 0
<RECEIVABLES> 190,185
<ALLOWANCES> 6,797
<INVENTORY> 112,000
<CURRENT-ASSETS> 312,711
<PP&E> 399,460
<DEPRECIATION> 251,971
<TOTAL-ASSETS> 766,158
<CURRENT-LIABILITIES> 305,524
<BONDS> 473,027
0
0
<COMMON> 23
<OTHER-SE> (61,606)
<TOTAL-LIABILITY-AND-EQUITY> 766,158
<SALES> 201,374
<TOTAL-REVENUES> 201,374
<CGS> 123,807
<TOTAL-COSTS> 188,708
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 6,045
<INCOME-PRETAX> 6,621
<INCOME-TAX> 2,648
<INCOME-CONTINUING> 3,973
<DISCONTINUED> (726)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,247)
<EPS-PRIMARY> (0.14)
<EPS-DILUTED> (0.14)
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS RESTATED FINANCIAL DATA SCHEDULE CONTAINS SUMMARY
FINANCIAL INFORMATION EXTRACTED FROM THE COMPANY'S BALANCE
SHEET AND STATEMENT OF OPERATIONS AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<RESTATED>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-03-1998
<PERIOD-END> MAR-29-1997<F1>
<CASH> 10,933
<SECURITIES> 0
<RECEIVABLES> 151,554
<ALLOWANCES> 5,386
<INVENTORY> 94,334
<CURRENT-ASSETS> 263,735
<PP&E> 364,718
<DEPRECIATION> 214,789
<TOTAL-ASSETS> 739,092
<CURRENT-LIABILITIES> 269,900
<BONDS> 575,191
0
0
<COMMON> 18
<OTHER-SE> (167,483)
<TOTAL-LIABILITY-AND-EQUITY> 739,092
<SALES> 191,127
<TOTAL-REVENUES> 191,127
<CGS> 120,956
<TOTAL-COSTS> 176,650
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 11,090
<INCOME-PRETAX> 3,387
<INCOME-TAX> 1,407
<INCOME-CONTINUING> 1,980
<DISCONTINUED> 70
<EXTRAORDINARY> (905)
<CHANGES> 0
<NET-INCOME> 1,145
<EPS-PRIMARY> 0.06
<EPS-DILUTED> 0.06
<FN>
<F1>RESTATEMENT REFLECTED HEREIN IS THE RESULT OF
RECLASSIFICATIONS TO PRIOR PERIODS' FINANCIAL STATEMENTS TO
CONFORM TO THE CURRENT PERIOD PRESENTATION.
</FN>
</TABLE>
