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SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) April 23, 1996
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COOPER INDUSTRIES, INC.
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(Exact Name of Registrant as Specified in its Charter)
Ohio
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(State or Other Jurisdiction of Incorporation)
1-1175 31-4156620
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(Commission File Number) (IRS Employer Identification No.)
1001 Fannin, Suite 4000, Houston, Texas 77002
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(Address of Principal Executive Offices) (Zip Code)
713/739-5400
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(Registrant's Telephone Number, Including Area Code)
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(Former Name or Former Address, if Changed Since Last Report)
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Item 5 Other Events
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First Quarter 1996 Results of Operations
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On April 23, 1996, the Company issued the press release attached hereto as
Exhibit 99.1 setting forth the Company's results of operations for the calendar
quarter ended March 31, 1996.
Business Outlook for 1996
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The following sets forth Cooper's general business outlook for 1996, based on
current expectations. The statements are forward looking and actual results
may differ materially. The comparative figures for 1996 include the effects of
acquisitions and divestitures made during 1995.
The Company expects revenues for the Electrical Products segment to increase
between 10 and 15 percent, which includes the recent acquisition of the CEAG
business. Revenues for the Tools & Hardware segment are expected to increase
by approximately five percent and revenues for the Automotive Products segment
are expected to increase between five and 10 percent.
The Company expects operating income for the Electrical Products segment to
increase by approximately 10 percent. Operating income for the Tools &
Hardware segment is expected to increase between five and 10 percent.
Operating income for the Automotive Products segment is expected to increase
between 10 and 15 percent.
Return on sales for the Electrical Products segment is expected to decrease
from the 1995 level of 17 percent, primarily as a result of the acquisition of
the CEAG business. Return on sales for the Tools & Hardware segment is
expected to improve slightly, while return on sales for the Automotive Products
segment is expected to improve to between 10.5 and 11 percent.
The above estimates are forward looking statements and involve a number of
assumptions, risks and uncertainties. The primary economic assumptions
include, without limitation, (i) modest growth in the domestic economy; (ii)
stabilization of the economic situation in Mexico in the early part of 1996
followed by a modest improvement as the year progresses; (iii) modest growth in
European markets; and (iv) a return during the year to normal historical demand
levels in the domestic market for automotive aftermarket products. The
estimates also assume, without limitation, no significant change in competitive
conditions, integration of recent acquisitions, the elimination as the year
progresses of negative operating variances experienced by the Company's
Crouse-Hinds business and Tools & Hardware segment during 1995 in
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connection with certain plant consolidations and such other risk factors as are
discussed from time to time in the Company's periodic SEC filings.
Item 7 Financial Statements and Exhibits
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Exhibits
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99.1 Company Press Release Dated April 23, 1996 Titled "Cooper
Industries Reports Net Income Up 12%. First-quarter share
earnings up 19%."
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 hereunto duly authorized.
COOPER INDUSTRIES, INC.
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(Registrant)
Date: April 23, 1996 /s/ Diane K. Schumacher
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Diane K. Schumacher
Senior Vice President,
General Counsel and Secretary
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EXHIBIT INDEX
Exhibit No.
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99.1 Company Press Release Dated April 23, 1996
Titled "Cooper Industries Reports Net Income
Up 12%. First-quarter share earnings up
19%."
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EXHIBIT 99.1
News Release
[COOPER LOGO]
FOR IMMEDIATE RELEASE
April 23, 1996
Contacts: Phyllis Piano Sharon Newquist
(713) 739-5415 (713) 739-5578
COOPER INDUSTRIES REPORTS NET INCOME UP 12%
FIRST-QUARTER SHARE EARNINGS UP 19%
HOUSTON, April 23 -- Fully diluted share earnings of Cooper Industries, Inc.
(NYSE-CBE) for the first quarter of 1996 rose 19% to 56 cents from 47 cents in
1995. Revenues rose 17% to $1.3 billion in 1996 from $1.1 billion during the
first quarter of 1995. First-quarter operating earnings (income before
interest expense and income taxes) rose to $143.3 million, up 8% from $132.5
million in the same period of 1995. Net income increased 12% to $62.1 million
in the first quarter of 1996 from $55.3 million in the comparable 1995 period.
Cooper's earnings per share were affected by the Cooper Cameron
Exchange Offer completed mid-year 1995, which reduced the company's outstanding
shares by 9.5 million. During the first quarter, Cooper also continued to sell
its marketable securities, the gain from which was offset by nonrecurring
expenses.
"We're off to an excellent start for 1996, with very encouraging
first-quarter results," said H. John Riley, Jr., President and Chief Executive
Officer. "All three of our business segments performed well, with solid
increases in revenues and earnings. Our businesses benefited from
acquisitions, new marketing initiatives and modest growth in the economy. We
were especially pleased with the improved performance of our automotive
segment," Riley reported.
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Cooper Industries, Inc. Page 2
The ELECTRICAL PRODUCTS segment recorded strong revenue increases.
Significant gains came from North American sales of hazardous-duty electrical
construction materials, transformers and distribution switchgear. Another
major contributor to higher sales was the CEAG electrical products operation in
Germany, acquired in December 1995.
TOOLS & HARDWARE revenues were up moderately, led by strong
international demand for power tool products, particularly from customers in
the automotive industry.
Revenues in the AUTOMOTIVE PRODUCTS segment exceeded expectations.
Demand was up for almost all products, particularly for those weather-related,
such as wiper blades and ignition products. New customer contracts,
penetration of overseas markets and recent acquisitions added to the
year-over-year gain.
"In addition to revenue gains, our businesses continued to focus on
ongoing operational improvements," Riley said. "For example, we announced
initiatives to implement a new business system in our automotive segment and to
construct a new, more efficient distribution center for our lighting
operations. Projects like these should help us respond more quickly and
effectively to meet customer needs.
"During the quarter, we also invested over $200 million in
complementary acquisitions and signed two joint venture agreements in the
growing Asian market. Nevertheless, we were able to maintain our debt to total
capitalization ratio at the 1995 year-end level.
"In summary, we had a good, solid quarter, positioning us for a
successful year. Assuming modest economic growth, we expect to meet our 1996
goal of double-digit earnings increases," Riley concluded.
Comparisons of 1996 and 1995 first-quarter results appear on the
following page.
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Cooper Industries, with 1995 revenues of $4.9 billion, is a
diversified, worldwide manufacturer of electrical products, tools, hardware,
and automotive products.
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Cooper Industries, Inc. Page 3
CONSOLIDATED RESULTS OF OPERATIONS
<TABLE>
<CAPTION>
Three Months Ended March 31,
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1996 1995
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(millions except shares)
Revenues:
<S> <C> <C>
Electrical Products $ 574.5 $ 480.6
Tools & Hardware 236.3 224.0
Automotive Products 488.4 415.6
Other 14.9 3.0
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1,314.1 1,123.2
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Costs and Expenses:
Cost of sales 875.8 748.3
Depreciation and amortization 59.1 51.5
Selling and administrative 235.9 190.9
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1,170.8 990.7
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Operating Earnings 143.3 132.5
Interest Expense 37.6 38.3
Income Taxes 43.6 38.9
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Net Income Applicable to Common Stock $ 62.1 $ 55.3
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Income Per Common Share:
Primary $ .58 $ .48
Fully Diluted(1) .56 .47
Shares Utilized in Computation of
Net Income Per Common Share:
Primary 107,389,000 116,187,000
Fully Diluted 124,166,000 132,934,000
</TABLE>
(1) The calculations for 1996 and 1995 assume conversion of the 7.05%
Convertible Subordinated Debentures to Common stock. As a result,
interest on the debentures ($7.3 million, net of tax) was added back
to income in the computation of fully diluted earnings per share.
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