FORM 10-Q/A
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 1998
Commission File Number 1-1657
CRANE CO.
(Exact name of registrant as specified in its charter)
Delaware 13-1952290
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
100 First Stamford Place, Stamford, CT. 06902
(Address of principal executive office) (Zip Code)
(203) 363-7300
(Registrant's telephone number, including area code)
(Not Applicable)
(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
The number of shares outstanding of the issuer's classes of common stock, as of
October 31, 1998:
Common stock, $1.00 Par Value - 68,624,818 shares
<PAGE>
Part I - Financial Information
The company hereby amends Part 1, Item 1, as set forth herein, of its Quarterly
Report on Form 10Q filed with the Securities and Exchange Commission on
November 13, 1998. The Cost in excess of net assets acquired balances were
transposed when transmitted. The 10Q shows the Cost in excess of net assets
acquired to be $220,563 (for 9/30/98), $368,437 (for 9/30/97) and $216,497
(for 12/31/97). The Cost in excess of net assets acquired should be $368,437
(for 9/30/98), $216,497 (for 9/30/97) and $220,563 (for 12/31/97). Therefore
Item 1, Financial Statements, has been amended.
Item 1. Financial Statements
<TABLE>
Crane Co. and Subsidiaries
Consolidated Statements of Income
(In Thousands, Except Per Share Amounts)
(Unaudited)
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1998 1997 1998 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net Sales $595,438 $534,818 $1,685,655 $1,520,915
Operating Costs and Expenses:
Cost of Sales 426,946 391,023 1,210,772 1,104,977
Selling, general and
Administrative 89,439 75,351 252,666 228,072
Depreciation and amortization 15,816 14,175 44,335 41,351
--------- --------- ----------- -----------
532,201 480,549 1,507,773 1,374,400
Operating Profit 63,237 54,269 177,882 146,515
Other Income (Expense):
Interest income 477 729 1,851 1,809
Interest expense (7,182) (6,046) (19,456) (17,989)
Miscellaneous - net (14) (56) (228) 177
--------- --------- ----------- -----------
(6,719) (5,373) (17,833) (16,003)
Income Before Taxes 56,518 48,896 160,049 130,512
Provision for Income Taxes 19,743 17,496 56,817 47,244
--------- --------- ----------- -----------
Net Income $ 36,775 $ 31,400 $ 103,232 $ 83,268
========= ========= =========== ===========
Net Income Per Share:
Basic $.54 $.46 $1.51 $1.21
Diluted .53 .45 1.49 1.20
Average Basic Shares Outstanding 68,670 68,844 68,543 68,619
Average Diluted Shares Outstanding 69,407 69,737 69,415 69,416
Dividends Per Share $.10 $.08 $.27 $.25
See Notes to Consolidated Financial Statements
</TABLE>
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<PAGE>
Part I - Financial Information
Item 1. Financial Statements
<TABLE>
Crane Co. and Subsidiaries
Consolidated Statements of Comprehensive Income
(In Thousands)
(Unaudited)
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1998 1997 1998 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net Income $36,775 $31,400 $103,232 $83,268
Other comprehensive income, net of tax-
Foreign currency translation adjustments 164 (1,769) (4,127) (7,013)
------- -------- --------- --------
Comprehensive Income $36,939 $29,631 $ 99,105 $76,255
======= ======== ========= ========
See Notes to Consolidated Financial Statements
</TABLE>
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<PAGE>
<TABLE>
Part I - Financial Information
Item 1. Financial Statements
Crane Co. and Subsidiaries
Consolidated Balance Sheets
(In Thousands, Except Per Share Amounts)
(Unaudited)
<CAPTION>
September 30, December 31,
1998 1997 1997
Assets
<S> <C> <C> <C>
Current Assets
Cash and cash equivalents $ 16,448 $ 21,863 $ 6,982
Accounts receivable 323,681 272,817 272,262
Inventories:
Finished goods 144,778 110,069 113,496
Finished parts and subassemblies 53,745 45,940 46,351
Work in process 48,374 45,003 51,345
Raw materials 90,337 71,243 79,892
---------- ---------- ----------
337,234 272,255 291,084
Other current assets 44,319 32,509 37,425
---------- ---------- ----------
Total Current Assets 721,682 599,444 607,753
Property, Plant and Equipment:
Cost 640,398 574,943 582,704
Less accumulated depreciation 334,002 309,813 308,947
---------- ---------- ----------
306,396 265,130 273,757
Other Assets 54,957 54,630 55,114
Intangibles 50,267 52,961 51,907
Cost in excess of net assets acquired 368,437 216,497 220,563
---------- ---------- ----------
$1,501,739 $1,188,662 $1,209,094
========== ========== ==========
See Notes to Consolidated Financial Statements
</TABLE>
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<PAGE>
<TABLE>
Part I - Financial Information
Item 1. Financial Statements
Crane Co. and Subsidiaries
Consolidated Balance Sheets
(In Thousands, Except Per Share Amounts)
(Unaudited)
<CAPTION>
September 30, December 31,
1998 1997 1997
Liabilities and Shareholders Equity
<S> <C> <C> <C>
Current Liabilities
Current maturities of long-term debt $ 825 $ 1,063 $ 992
Loans payable 53,070 16,296 30,240
Accounts payable 147,202 125,232 122,616
Accrued liabilities 142,556 117,502 128,794
U.S. and foreign taxes on income 22,258 8,986 13,170
----------- ----------- -----------
Total Current Liabilities 365,911 269,079 295,812
Long-Term Debt 403,670 266,916 260,716
Deferred Income Taxes 47,752 55,951 46,007
Other Liabilities 28,818 26,551 25,618
Accrued Postretirement Benefits 40,665 42,106 41,838
Accrued Pension Liability 6,540 6,202 6,559
Preferred Shares, par value $.01 - - -
5,000,000 shares authorized
Common Shareholders Equity:
Common Shares, par value $1.00 68,625 68,819 68,313
120,000,000 shares authorized,
68,624,818, 68,818,704 and
68,312,730 shares outstanding
Capital surplus 15,283 31,396 19,951
Retained earnings 545,152 436,023 460,830
Accumulated other comprehensive income (20,677) (14,381) (16,550)
----------- ----------- -----------
Total Common Shareholders Equity 608,383 521,857 532,544
$1,501,739 $1,188,662 $1,209,094
=========== =========== ===========
See Notes to Consolidated Financial Statements
</TABLE>
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<PAGE>
<TABLE>
Part I - Financial Information (Cont'd.)
Item 1. Financial Statements
Crane Co. and Subsidiaries
Consolidated Statements of Cash Flows
(In Thousands)
(Unaudited)
<CAPTION>
September 30,
1998 1997
<S> <C> <C>
Cash flows from Operating activities:
Net income $103,232 $ 83,268
Depreciation 28,551 27,622
Amortization 15,784 13,729
Deferred income taxes (169) (220)
Cash used for operating working capital (10,349) (12,250)
Other (3,786) (4,310)
--------- ---------
Total provided by operating activities 133,263 107,839
Cash flows used for Investing activities:
Capital Expenditures (42,608) (31,049)
Payments for acquisitions (225,394) (36,107)
Proceeds from divestitures 4,276 -
Proceeds from disposition of capital assets 774 4,457
--------- ---------
Total used for investing activities (262,952) (62,699)
Cash flows from Financing activities:
Equity:
Dividends paid (18,331) (17,170)
Reacquisition of shares-open market (6,323) (4,857)
Reacquisition of shares-stock incentive programs (10,922) (4,383)
Stock options exercised 8,633 6,390
--------- ---------
Net Equity (26,943) (20,020)
Debt:
Proceeds from issuance of long-term debt 143,565 -
Repayments of long-term debt (943) (3,461)
Net increase (decrease) in short-term debt 22,758 (10,710)
--------- ---------
Net Debt 165,380 (14,171)
--------- ---------
Total provided by (used for) financing activities 138,437 (34,191)
Effect of exchange rate on cash and cash equivalents 718 (665)
--------- ---------
Increase in cash and cash equivalents 9,466 10,284
Cash and cash equivalents at beginning of period 6,982 11,579
--------- ---------
Cash and cash equivalents at end of period $ 16,448 $ 21,863
========= =========
Detail of Cash Provided by (Used for) Operating
Working Capital (net of effects of acquisitions)
Accounts Receivable $(22,430) $(34,055)
Inventories (14,560) (1,650)
Other current assets (2,413) 1,488
Accounts Payable 13,991 19,747
Accrued Liabilities 4,638 105
U.S. and foreign taxes on income 10,425 2,115
--------- ---------
Total $(10,349) $(12,250)
========= =========
Supplemental disclosure of cash flow information:
Interest paid $ 17,921 $ 16,963
Income taxes paid 43,388 39,876
See Notes to Consolidated Financial Statements
</TABLE>
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<PAGE>
Part I - Financial Information (Cont'd.)
Notes to Consolidated Financial Statements (Unaudited)
<TABLE>
1. The accompanying unaudited consolidated financial statements have been
prepared in accordance with the instructions to Form 10-Q and, therefore
reflect all adjustments which are, in the opinion of management, necessary
for a fair statement of the results for the interim period presented.
Certain prior year amounts have been reclassified to conform to the 1998
presentation.
These interim consolidated financial statements should be read in
conjunction with the Consolidated Financial Statements and Notes to
Consolidated Financial Statements in the company's Annual Report on Form
10-K for the year ended December
31, 1997.
2. Sales and operating profit by segment are as follows:
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1998 1997 1998 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
(In thousands)
Net Sales:
Fluid Handling $108,010 $100,460 $ 339,108 $ 290,734
Aerospace 102,458 85,866 297,410 252,878
Engineered Materials 72,992 56,841 198,373 171,817
Crane Controls 32,294 32,821 102,514 98,149
Merchandising Systems 49,039 44,271 145,052 137,095
Wholesale Distribution 230,857 213,743 604,187 568,885
Other 3,108 3,675 9,984 10,071
Intersegment Elimination (3,320) (2,859) (10,973) (8,714)
--------- --------- ----------- -----------
Total $595,438 $534,818 $1,685,655 $1,520,915
========= ========= =========== ===========
Operating Profit (Loss):
Fluid Handling $ 2,969 $ 8,927 $ 18,693 $ 22,454
Aerospace 31,679 22,903 88,212 64,596
Engineered Materials 10,979 7,993 28,224 22,689
Crane Controls 2,277 3,353 8,254 8,560
Merchandising Systems 8,244 6,577 26,655 24,445
Wholesale Distribution 12,418 9,015 24,547 18,868
Other (212) 230 (438) 753
Corporate (5,132) (4,724) (16,268) (15,998)
Intersegment Elimination 15 (5) 3 148
-------- -------- --------- ---------
Total $63,237 $54,269 $177,882 $146,515
======== ======== ========= =========
</TABLE>
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<PAGE>
Part I - Financial Information (Cont'd.)
Notes to Consolidated Financial Statements
3. Inventories
Inventories are stated at the lower of cost or market, principally on the
last-in, first-out (LIFO) method of inventory valuation. Replacement cost
would be higher by $47.6 million at September 30, 1998, $52.1 million at
September 30, 1997, and $46.6 million at December 31, 1997.
4. Intangibles
Intangible assets are amortized on a straight-line basis over their
estimated useful lives, which range form five to twenty years. Accumulated
amortization was $21.7 million at September 30, 1998, $17.4 million at
September 30, 1997 and $18.5 million at December 31, 1997
5. Cost in Excess of Net Assets Acquired
Cost in excess of net assets acquired is amortized on a straight- line
basis principally over a 15 to 40 years. Accumulated amortization was
$45.9 million at September 30, 1998, $35.2 million at September 30, 1997
and $37.4 million at December 31, 1997.
6. Disclosure of Accumulated Other Comprehensive Income Balances
The company adopted Statement of Financial Accounting Standards No. 130
"Reporting Comprehensive Income" on January 1, 1998. Comprehensive Income
is the change in equity of a business enterprise during a period from
transactions and other events and circumstances, from non-owner sources. It
includes all changes in equity during a period except those resulting from
investments by owners and dispositions to owners.
Activity for the period is as follows:
<TABLE>
<CAPTION>
Accumulated
Other
Comprehensive
Income
<S> <C>
Accumulated other comprehensive income January 1, 1998 $(16,550)
Foreign currency translation adjustment 108
---------
Accumulated other comprehensive income March 31, 1998 (16,442)
Foreign currency translation adjustment (4,399)
---------
Accumulated other comprehensive income June 30, 1998 (20,841)
Foreign currency translation adjustment 164
---------
Accumulated other comprehensive income September 30, 1998 $(20,677)
=========
</TABLE>
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<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.
CRANE CO.
REGISTRANT
Date November 24, 1998 By /s/ D.S. Smith
----------------- ----------
D.S. SMITH
Vice President and Chief Financial
Officer
Date November 24, 1998 By /s/ M.L. Raithel
----------------- ------------
M.L. RAITHEL
Controller
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