<PAGE> 1
FORM 1O-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 2O549
------------------------------------
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
-------------------------------------------
For quarter ended May 31, 1999
Commission File Number 1-4304
COMMERCIAL METALS COMPANY
----------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 75-0725338
- ------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
7800 Stemmons Freeway
P.O. Box 1046 Dallas, Texas 75221
--------------------------------
(Address of principal executive offices)
(Zip Code)
(214) 689-4300
-------------
(Registrant's telephone number, including area code)
-----------------------------------------
Former name, former address and former fiscal year,
if changed since last report
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
----- -----
As of May 31, 1999 there were 14,332,692 shares of the Company's common stock
issued and outstanding excluding 1,799,891 shares held in the Company's
treasury.
<PAGE> 2
COMMERCIAL METALS COMPANY AND SUBSIDIARIES
INDEX
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
PART I - Financial Statements:
Consolidated Balance Sheets -
May 31, 1999 and August 31, 1998 2-3
Consolidated Statements of Earnings -
Three months and nine months ended
May 31, 1999 and 1998 4
Consolidated Statements of Cash Flows -
Nine months ended May 31, 1999 and 1998 5
Consolidated Statement of Stockholders' Equity
For the nine months ended May 31, 1999 6
Notes to Consolidated Financial Statements 7
Management's Discussion and Analysis of the
Consolidated Financial Statements 8-14
PART II - Other Information and Signatures 15-16
</TABLE>
Page 1
<PAGE> 3
COMMERCIAL METALS COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
(In thousands except share data)
<TABLE>
<CAPTION>
May 31, August 31,
1999 1998
----------- -----------
<S> <C> <C>
CURRENT ASSETS:
Cash $ 32,520 $ 30,985
Accounts receivable (less allowance for
collection losses of $8,019 and $8,120) 318,149 318,655
Inventories 233,803 257,231
Other 54,251 66,629
----------- -----------
TOTAL CURRENT ASSETS 638,723 673,500
OTHER ASSETS 13,569 10,655
PROPERTY, PLANT, AND EQUIPMENT, at cost:
Land 25,394 24,967
Buildings 84,805 67,505
Equipment 597,635 499,899
Leasehold improvements 28,956 26,084
Construction in process 58,880 61,946
----------- -----------
795,670 680,401
Less accumulated depreciation
and amortization (395,192) (361,939)
----------- -----------
400,478 318,462
----------- -----------
$ 1,052,770 $ 1,002,617
=========== ===========
</TABLE>
See notes to consolidated financial statements.
Page 2
<PAGE> 4
COMMERCIAL METALS COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS' EQUITY
( In thousands except share data )
<TABLE>
<CAPTION>
May 31, August 31,
1999 1998
----------- -----------
<S> <C> <C>
CURRENT LIABILITIES:
Commercial paper $ 25,000 $ 40,000
Notes payable 9,644 60,809
Accounts payable 164,584 156,389
Other payables and accrued expenses 154,863 150,512
Income taxes payable 725 6,870
Current maturities of long-term debt 9,704 11,483
----------- -----------
TOTAL CURRENT LIABILITIES 364,520 426,063
DEFERRED INCOME TAXES 21,376 21,376
LONG-TERM DEBT 264,863 173,789
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Capital stock:
Preferred stock -- --
Common stock, par value $5.00 a share;
authorized 40,000,000 shares; issued
16,132,583 shares, outstanding
14,332,692 and 14,569,611 shares 80,663 80,663
Additional paid-in capital 14,262 14,285
Cumulative translation adjustment (650) (1,596)
Retained earnings 353,320 328,597
----------- -----------
447,595 421,949
Less treasury stock,
1,799,891 and 1,562,972 shares at cost (45,584) (40,560)
----------- -----------
402,011 381,389
----------- -----------
$ 1,052,770 $ 1,002,617
=========== ===========
</TABLE>
See notes to consolidated financial statements.
Page 3
<PAGE> 5
COMMERCIAL METALS COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands except share data)
<TABLE>
<CAPTION>
Three months ended Nine months ended
May 31, May 31,
---------------------------- ----------------------------
1999 1998 1999 1998
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
NET SALES $ 582,154 $ 606,099 $ 1,682,067 $ 1,724,778
COSTS AND EXPENSES:
Cost of goods sold 506,015 532,263 1,461,645 1,520,857
Selling, general and
administrative expenses 50,601 46,213 145,567 132,585
Interest expense 4,088 4,720 13,632 13,117
Employees' retirement plans 3,917 4,908 12,778 14,314
----------- ----------- ----------- -----------
564,621 588,104 1,633,622 1,680,873
EARNINGS BEFORE INCOME TAXES 17,533 17,995 48,445 43,905
INCOME TAXES 6,531 6,604 18,046 16,113
----------- ----------- ----------- -----------
NET EARNINGS $ 11,002 $ 11,391 $ 30,399 $ 27,792
=========== =========== =========== ===========
Basic earnings per share $ 0.76 $ 0.77 $ 2.09 $ 1.88
Diluted earnings per share $ 0.76 $ 0.75 $ 2.07 $ 1.84
Cash dividends per share $ 0.13 $ 0.13 $ 0.39 $ 0.39
Average basic shares outstanding 14,493,180 14,870,346 14,559,437 14,786,736
Average diluted shares outstanding 14,562,281 15,254,211 14,663,998 15,112,299
</TABLE>
See notes to consolidated financial statements.
Page 4
<PAGE> 6
COMMERCIAL METALS COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
<TABLE>
<CAPTION>
Nine months ended
May 31,
-------------------------
1999 1998
- ----------------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings $ 30,399 $ 27,792
Adjustments to earnings not requiring cash:
Depreciation and amortization 36,621 34,722
Provision for losses on receivables 1,789 1,957
Other (125) (95)
--------- ---------
Cash flows from operations before changes in
current assets and liabilities 68,684 64,376
Changes in current assets and liabilities:
Decrease (increase) in receivables (1,283) (54,600)
Decrease (increase) in inventories 23,428 (36,024)
Decrease (increase) in other assets 10,410 (8,100)
Increase (decrease) in accounts payable,
accrued expenses and income taxes 6,401 33,299
--------- ---------
Net Cash Provided (Used) by Operating Activities 107,640 (1,049)
- ----------------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment (118,637) (87,669)
Sales of property, plant and equipment 125 95
--------- ---------
Net Cash Used by Investing Activities (118,512) (87,574)
- ----------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Commercial paper - net change (15,000) 40,000
Notes payable - net change (51,165) 58,000
New long-term debt 100,000 --
Payments on long-term debt (10,705) (11,428)
Stock issued under stock option and purchase plans 1,614 7,500
Treasury stock acquired (6,661) (2,857)
Dividends paid (5,676) (5,797)
--------- ---------
Net Cash Provided by Financing Activities 12,407 85,418
- ----------------------------------------------------------------------------------------------
Increase (Decrease) in Cash and Cash Equivalents 1,535 (3,205)
Cash and Cash Equivalents at Beginning of Year 30,985 32,998
--------- ---------
Cash and Cash Equivalents at End of Period $ 32,520 $ 29,793
========= =========
</TABLE>
See notes to consolidated financial statements.
Page 5
<PAGE> 7
COMMERCIAL METALS COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(In thousands except share data)
<TABLE>
<CAPTION>
Common Stock Treasury Stock
--------------------- -----------------------
Cumulative Add'l
Number of Translation Paid-In Retained Number of
Shares Amount Adjustment Capital Earnings Shares Amount
---------- ------- ------------ -------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance September 1, 1998 16,132,583 $80,663 ($1,596) $14,285 $ 328,597 (1,562,972) ($ 40,560)
Net earnings for nine months
ended May 31, 1999 30,399
Cash dividends - $.39 a share (5,676)
Treasury stock acquired (300,000) (6,661)
Translation adjustment 946
Stock issued under stock option,
purchase and bonus plans (23) 63,081 1,637
---------- ------- ------- ------- ---------- ---------- ----------
Balance, May 31, 1999 16,132,583 $80,663 ($ 650) $14,262 $ 353,320 (1,799,891) ($ 45,584)
========== ======= ======= ======= ========== ========== ==========
</TABLE>
See notes to consolidated financial statements.
Page 6
<PAGE> 8
COMMERCIAL METALS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE A - LONG-TERM DEBT AND EQUITY (in thousands):
<TABLE>
<CAPTION>
Total
Long-Term Current Amount
Debt Maturities Outstanding
--------- ---------- -----------
<S> <C> <C> <C>
6.75% notes due 2009 $ 100,000 $ -- $100,000
7.20% notes due 2005 100,000 -- 100,000
6.80% notes due 2007 50,000 -- 50,000
8.49% notes due 2001 14,285 7,143 21,428
8.75% note due 1999 2,141 2,141
Other 578 420 998
--------- ---------- -----------
$ 264,863 $ 9,704 $274,567
========= ========== ===========
</TABLE>
NOTE B - TAXES ON INCOME:
Provision for taxes on income includes estimated United States taxes on
undistributed earnings of subsidiaries outside the United States.
NOTE C - QUARTERLY FINANCIAL DATA:
In the opinion of Management, the accompanying unaudited consolidated
financial statements contain all adjustments (consisting of only normal
recurring accruals) necessary to present fairly the financial position as of
May 31, 1999, the results of operations for the three months and nine months
then ended and the cash flows for the nine months. The results of operations for
the nine month periods are not necessarily indicative of the results to be
expected for a full year.
NOTE D - EARNINGS PER SHARE:
There were no adjustments to net earnings to arrive at net income for
either the three months or nine months ended May 31, 1999 and 1998. The
reconciliation of the denominators of the earnings per share calculations are as
follows:
<TABLE>
<CAPTION>
Three months Nine months
ended May 31, ended May 31,
1999 1998 1999 1998
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Shares outstanding for basic earnings per share 14,493,180 14,870,346 14,559,437 14,786,736
Effect of dilutive securities:
Stock options/purchase plans 69,101 383,865 104,561 325,563
Shares outstanding for dilutive earnings per share 14,562,281 15,254,211 14,663,998 15,112,299
</TABLE>
Stock options with total share commitments of 1,584,437 at May 31, 1999
were anti-dilutive based on an average share price of $22.45 for the quarter and
exercise prices between $24.50 and $29.81. The options expire at various dates
between 2003 and 2006.
NOTE E - OTHER COMPREHENSIVE INCOME:
The Company's foreign currency translation adjustments totaled $335,000 and
$946,000 in the quarter and nine months ended May 31, 1999, respectively.
Page 7
<PAGE> 9
MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE
CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED RESULTS OF OPERATIONS
(in millions)
<TABLE>
<CAPTION>
Nine months ended
Third Quarter May 31,
---------------------- -----------------------
1999 1998 1999 1998
----- ----- ------ ------
<S> <C> <C> <C> <C>
Net sales $ 582 $ 606 $1,682 $1,725
Net earnings 11.0 11.4 30.4 27.8
Cash flow 24.8 24.0 68.7 64.4
EBITDA 34.8 34.4 98.7 91.7
LIFO reserve 12.2 28.5
</TABLE>
SIGNIFICANT EVENTS AFFECTING THE COMPANY THIS QUARTER:
- - Net earnings including start up costs were comparable to the prior year
period.
- - Higher steel fabrication and copper tube profitability sustained the
Manufacturing Segment.
- - Steel minimill operating profit declined from the prior year period due to
construction interference, an import surge at very low prices, and a
transformer problem at the Texas mill.
- - The Company acquired Construction Materials, Inc., expanding its concrete -
related products business.
- - The Recycling segment recorded a smaller loss than the prior year period in
continuing poor market conditions.
- - The Marketing and Trading segment continued to be profitable despite global
oversupply and depressed prices.
Page 8
<PAGE> 10
CONSOLIDATED DATA
The LIFO method of inventory valuation increased net earnings for the quarter
$3.5 million (24 cents per diluted share) compared to an increase of $280
thousand (2 cents per diluted share) last year. For the nine months, net
earnings were $6.7 million higher (45 cents per diluted share) compared to an
increase of $1.1 million (7 cents per diluted share) last year.
SEGMENT OPERATING DATA
(in thousands)
Net sales and operating profit by business segment are shown in the following
table:
<TABLE>
<CAPTION>
Three months ended Nine months ended
May 31, May 31,
---------------------------- ------------------------------
1999 1998 1999 1998
--------- --------- ----------- -----------
<S> <C> <C> <C> <C>
NET SALES:
Manufacturing $ 306,316 $ 313,719 $ 899,567 $ 883,757
Recycling 81,591 109,087 236,727 318,107
Marketing and Trading 202,486 199,866 589,474 570,755
Corporate and Elimination (8,239) (16,573) (43,701) (47,841)
--------- --------- ----------- -----------
$ 582,154 $ 606,099 $1,682,067 $ 1,724,778
========= ========= ========== ===========
OPERATING PROFIT (LOSS):
Manufacturing $ 19,608 $ 19,683 $ 59,917 $ 48,339
Recycling (255) (420) (6,109) (410)
Marketing and Trading 4,825 4,962 14,167 12,638
Corporate and Elimination (2,557) (1,510) (5,898) (3,545)
--------- --------- ----------- -----------
$ 21,621 $ 22,715 $ 62,077 $ 57,022
========= ========= =========== ===========
</TABLE>
MANUFACTURING -
The Company's Manufacturing segment consists of the Steel Group and the Copper
Tube Division. Operating profit for the segment was comparable to last year's
third quarter while revenues decreased 2%. Operating profit for the Company's
four steel minimills was 42% below the prior year period. This was offset by
higher earnings of the steel fabrication businesses and significantly better
operating profit for the Copper Tube Division. Segment net sales decreased due
to lower steel mill production levels and selling prices. However, margins were
aided by lower raw material costs.
Page 9
<PAGE> 11
Steel prices were mixed as reflected in the table below:
<TABLE>
<CAPTION>
Three months ended
May 31,
--------------------
1999 1998
---- ----
<S> <C> <C>
Average mill selling price $290 $326
Average fab selling price 667 649
Average scrap purchase price 73 113
</TABLE>
The Steel Group operating profit was 8% below last year's third quarter. Mill
shipments declined 8% to 449,000 tons from 490,000 tons while production levels
were significantly down from last year because of major construction projects at
the SMI Alabama and SMI South Carolina mills, the impact of imports and a
transformer failure at the SMI Texas mill. However, margins were aided by lower
scrap prices. While the average mill selling price was $36 per ton below last
year, average scrap purchase costs were lower by $40 per ton. The mills absorbed
an after-tax charge $1.8 million relating to construction interference with
operations and start-up costs associated with the construction projects.
The new 800,000 tons per year rolling mill in South Carolina was commissioned in
April, and in May, the Company began commissioning the new automated finishing
line at the Alabama mill. Additional depreciation and amortization expense of $
1.2 million was incurred in May for the South Carolina mill, and depreciation
will begin in June for the Alabama project.
Net sales and operating profit in the fabrication businesses were significantly
above the prior year's third quarter in spite of losses on several large
structural steel jobs. Fabricated steel shipments totaled 222,000 tons, and were
identical to the prior year period. The average fab selling price rose $18 per
ton, partially because of product mix, while the cost of steel purchased
declined. During the quarter, the Steel Group acquired substantially all of the
assets of Construction Materials, Inc., expanding its concrete-related products
business into Louisiana.
The Steel Group computer migration project after-tax expense for the third
quarter 1999 was $2.3 million compared with $ 1.6 million last year.
The Copper Tube Division operating profit almost doubled the same period last
year due to better material spreads, while net sales increased 4%. Demand for
plumbing and refrigeration tube was buoyed by the strong housing sector in the
third quarter 1999. Copper tube shipments increased 2% versus the third quarter
last year and production was 8% higher.
Page 10
<PAGE> 12
RECYCLING -
The Recycling segment reported an operating loss of $255,000 for the third
quarter 1999, which represented a 39% improvement from the prior year period
loss of $420,000. Market conditions remained poor which resulted in a 25%
decrease in net sales. However, results were better than the second quarter due
to cost reductions at the processing plants. Cash flow from operations was
positive. Ferrous scrap tonnage shipped decreased 1% and ferrous sales prices
were an average $80 per ton or 30% lower than a year ago. The intake of scrap
remained depressed. Nonferrous shipments increased 6%, and margins were higher.
Total volume of scrap processed, including the Steel Group processing plants,
was 528,000 tons, an increase of 9% from the 483,000 tons processed during the
prior year period.
MARKETING AND TRADING -
Operating income for the Marketing and Trading segment was 3% lower than the
prior year's third quarter, while net sales increased 1%. International metal
markets continued to be oversupplied, and world prices remained depressed. Steel
prices were substantially below last year and gross margins in steel marketing
and distribution as well as steel trading consequently remained tight. The
Company achieved further penetration in highly competitive, low priced markets
for nonferrous metal products and maintained profitability through product line
expansion. The industrial raw materials and products including ores, minerals,
ferrous raw materials and primary metals remained profitable despite the pricing
pressures.
YEAR 2000 -
As described in its Form 10K report for the year ended August 31, 1998, the
Company has a comprehensive program to meet anticipated Year 2000 concerns. It
continues to be substantially on schedule with this program. Steel Group
computer migration after-tax expense this quarter was $2.3 million. Recycling,
Marketing and Trading, and Corporate costs were minimal.
ENVIRONMENTAL ACTIVITIES
The Company is subject to federal, state and local pollution control laws and
regulations in all locations where it has operating facilities. It anticipates
that compliance with these laws and regulations will involve continuing capital
expenditures and operating costs.
Page 11
<PAGE> 13
In the ordinary course of conducting its business, the Company becomes involved
in environmental litigation, administrative proceedings, and governmental
investigations. Certain of these environmental matters or other proceedings may
result in fines, penalties or judgments against the Company which may have a
material impact on earnings for a particular quarter. While the Company is
unable to estimate precisely the ultimate dollar amount of exposure to losses in
connection with such matters, it makes timely accruals as warranted. It is the
opinion of the Company's management that the outcome of such proceedings,
individually or in the aggregate, will not have a material adverse effect on the
business or consolidated financial position of the Company.
OUTLOOK -
The outlook is mixed. Demand from the construction and manufacturing sectors of
the U.S. economy remains strong whereas global markets still are weak. Low
inventory levels for steel and nonferrous metal products in certain markets have
stimulated orders, and international steel prices have had some recovery, albeit
from depressed levels.
Improved realized prices for the Company's steel bar products are anticipated,
and manufacturing margins should remain consistent, primarily because any
increases in the costs of raw material and supplies also should be modest. Steel
mill production and shipments are expected to increase as the new mill projects
are commissioned and become operational. The outlook for steel fabrication
remains favorable, and the Company's downstream operations should benefit from
the lower mill prices coupled with steady fab prices. Residential construction
remains robust; consequently, the demand for copper tube is expected to remain
strong. Indications are that the Federal transportation bill is leading to
greater spending for highways and bridges. In general, steel bar and structural
steel consumption should shift towards the public sector during the next few
years.
Ferrous scrap prices were somewhat firmer at the end of the quarter while
nonferrous prices were weaker. Domestic demand is good, but export markets still
are shaky. The fourth quarter of fiscal 1999 is likely to be comparable to the
third quarter for the Recycling segment.
In Marketing and Trading, most steel prices have marginally improved. Steel
imports into the U.S. are forecast to decline, primarily due to anti-dumping
and competitive domestic prices. The weak worldwide demand and prices for
nonferrous metals will persist for the near future. The relatively more stable
prices, though, should improve profit margins. The Company will continue to
capitalize on opportunities that arise from the financial and market
dislocations around the globe.
Page 12
<PAGE> 14
The Company's capital investments should generate additional net sales and
earnings, especially beginning in the year 2000. The Company's vertical
integration and unique business mix will continue to benefit operations, and a
more favorable pricing environment is anticipated.
This outlook section and third paragraph under the Manufacturing commentary
above contain forward-looking statements regarding the outlook for the Company's
short-term financial results including shipments, pricing, demand, production
rates, general market conditions, and anticipated construction project
completion and start-up. There is inherent risk and uncertainty in any
forward-looking statements. Variances will occur and some could be materially
different from management's current opinion. Developments that could impact the
Company's expectations include interest rate changes, construction activity,
unanticipated start-up expenses and delays, metals pricing over which the
Company exerts little influence, new capacity and product availability from
competing steel minimills and other steel suppliers including import quantities
and pricing, global factors including credit availability, currency
fluctuations, timing of litigation settlements and decisions by governments
impacting the level and pace of overall economic growth.
LIQUIDITY
Cash flows from operations before changes in operating assets and liabilities
for the nine months were $68.7 million compared to $64.4 million last year, due
to higher net earnings, and depreciation and amortization. Inventories decreased
$23.4 million with decreases in all segments due to decreased purchase prices
and the Company's efforts to reduce its working capital requirements. Other
assets decreased $10.4 million due to lower advances for materials. Accounts
payable and accrued expenses increased $6.4 million, primarily due to provisions
for employee benefit plans.
The Company paid down short term debt with a second quarter public offering of
$100 million investment grade, unsecured 6.75% ten year notes. The offering also
included a shelf registration of $100 million. The Company also reduced its
long-term debt by $10.7 million. The Company invested $118.6 million in capital
expenditures, primarily for its South Carolina and Alabama mill projects, as
part of its anticipated $150 million annual capital program.
At May 31, 1999, there were 14,322,692 common shares issued and outstanding with
1,799,891 held in the Company's treasury. Stockholders' equity was $402 million
or $28.05 per share. During the third quarter, the Company repurchased 300,000
shares of common stock at an average price of $22.20.
Page 13
<PAGE> 15
Net working capital was $274 million at May 31, 1999 compared to $247 million at
August 31,1998. The current ratio was 1.8 compared to 1.6 at August 31,1998. The
Company's effective tax rate for the nine months was 37.3%, compared to 36.7%
last year.
Long-term debt as a percent of total capitalization was 38.5% at May 31, 1999
compared to 30.1% at August 31, 1998. The ratio of total debt to total
capitalization plus short-term debt stood at 42.2%, lower than the second
quarter but an increase from year end due to capital expenditures and working
capital requirements.
Page 14
<PAGE> 16
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Reference is made to the information incorporated by reference from Item 3.
Legal Proceedings in the Company's Annual Report on Form 10-K for the year
ending August 31, 1998, filed November 24, 1998, with the Securities and
Exchange Commission.
ITEM 2. CHANGES IN SECURITIES
Not Applicable
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not Applicable
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not Applicable
ITEM 5. OTHER INFORMATION
Not Applicable
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A. Exhibits required by Item 601 of Regulation S-K.
27. Financial Data Schedule for the period ended May 31, 1999.
B. No reports on Form 8-K have been filed during the quarter for
which this report is filed.
Page 15
<PAGE> 17
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.
COMMERCIAL METALS COMPANY
/s/ WILLIAM B. LARSON
July 1, 1999 William B. Larson
Vice President
& Chief Financial Officer
/s/ MALINDA G. SULLIVAN
July 1, 1999 Malinda G. Sullivan
Controller
Page 16
<PAGE> 18
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> AUG-31-1999
<PERIOD-START> SEP-01-1998
<PERIOD-END> MAY-31-1999
<CASH> 32,520
<SECURITIES> 0
<RECEIVABLES> 326,168
<ALLOWANCES> 8,019
<INVENTORY> 233,803
<CURRENT-ASSETS> 638,723
<PP&E> 795,670
<DEPRECIATION> 395,192
<TOTAL-ASSETS> 1,052,770
<CURRENT-LIABILITIES> 364,520
<BONDS> 0
0
0
<COMMON> 80,663
<OTHER-SE> 321,348
<TOTAL-LIABILITY-AND-EQUITY> 1,052,770
<SALES> 1,682,067
<TOTAL-REVENUES> 1,682,067
<CGS> 1,461,645
<TOTAL-COSTS> 1,461,645
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 1,789
<INTEREST-EXPENSE> 13,632
<INCOME-PRETAX> 48,445
<INCOME-TAX> 18,046
<INCOME-CONTINUING> 30,399
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 30,399
<EPS-BASIC> 2.09
<EPS-DILUTED> 2.07
</TABLE>
