UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
CUMMINS ENGINE COMPANY, INC.
____________________________
For the Quarter Ended June 28, 1998 Commission File Number 1-4949
_____________ ______
Indiana 35-0257090
_______ __________
(State or Other Jurisdiction of (IRS Employer Identification No.)
Incorporation or Organization)
500 Jackson Street, Box 3005,
____________________________
Columbus, Indiana 47202-3005
_________________ __________
(Address of Principal Executive Offices) (Zip Code)
812-377-5000
____________
(Registrant's Telephone Number)
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 proceeding 12 months and (2) has been
subject to such filing requirements for the past 90 days:
Yes [x]
No [ ]
Indicate the number of shares outstanding of each of the issuer's
classes of common stock as of the latest practicable date:
As of June 28, 1998, the number of shares outstanding of the
registrant's only class of common stock was 42.1 million.
<PAGE>
TABLE OF CONTENTS
_________________
Page No.
________
PART I. FINANCIAL INFORMATION
______________________________
Item 1. Financial Statements
Consolidated Statement of Earnings for the Second 3
Quarter and First Half Ended June 28, 1998 and
June 29, 1997
Consolidated Statement of Financial Position at 4
June 28, 1998 and December 31, 1997
Consolidated Statement of Cash Flows for the First 5
Half Ended June 28, 1998 and June 29, 1997
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Results of 8
Operations, Cash Flow and Financial Condition
PART II. OTHER INFORMATION
___________________________
Item 6. Exhibits and Reports on Form 8-K 11
Index to Exhibits 13
<PAGE>
CUMMINS ENGINE COMPANY, INC.
CONSOLIDATED STATEMENT OF EARNINGS
FOR THE SECOND QUARTER AND FIRST HALF
ENDED JUNE 28, 1998 AND JUNE 29, 1997
Unaudited
_____________________________________
Second Quarter First Half
________________ ________________
Millions, except per share amounts 1998 1997 1998 1997
__________________________________ ______ ______ ______ ______
Net sales $1,635 $1,396 $3,135 $2,700
Cost of goods sold 1,266 1,072 2,426 2,090
Special charge - - 43 -
______ ______ ______ ______
Gross profit 369 324 666 610
Selling & administrative expenses 199 186 401 364
Research & engineering expenses 65 64 132 125
Net expense (income) from joint
ventures and alliances 6 ( 2) 10 ( 9)
Interest expense 18 7 35 12
Other income, net - ( 5) ( 7) (12)
______ ______ ______ ______
Earnings before income taxes 81 74 95 130
Provision for income taxes 24 21 28 36
Minority interest 4 - 7 -
______ ______ ______ ______
Net earnings $ 53 $ 53 $ 60 $ 94
______ ______ ______ ______
______ ______ ______ ______
Basic earnings per share $ 1.39 $ 1.40 $ 1.57 $ 2.46
Diluted earnings per share $ 1.38 $ 1.38 $ 1.55 $ 2.44
Cash dividends declared per share $ .275 $ .275 $ .55 $ .525
<PAGE>
CUMMINS ENGINE COMPANY, INC.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unaudited
____________________________________________
Millions, except per share amounts 6/28/98 12/31/97
__________________________________ _______ ________
Assets
Current assets:
Cash and cash equivalents $ 40 $ 49
Receivables 975 771
Inventories 767 677
Other current assets 199 213
______ ______
1,981 1,710
Investments and other assets 308 346
Property, plant & equipment less accumulated
depreciation of $1,403 and $1,434 1,664 1,532
Goodwill, net of amortization of $11 and $5 384 12
Other intangibles, deferred taxes and deferred
charges 191 165
______ ______
Total assets $4,528 $3,765
______ ______
______ ______
Liabilities and shareholders' investment
Current liabilities:
Loans payable $ 57 $ 90
Current maturities of long-term debt 36 42
Accounts payable 399 386
Other current liabilities 634 537
______ ______
1,126 1,055
______ ______
Long-term debt 1,168 522
______ ______
Other liabilities 749 713
______ ______
Minority interest 59 53
______ ______
Shareholders' investment:
Common stock, $2.50 par value, 47.9 and 48.1
shares issued 120 120
Additional contributed capital 1,114 1,119
Retained earnings 752 713
Common stock in treasury, at cost, 5.8 and 6.0
shares (226) (245)
Common stock held in trust for employee benefit
plans, 3.6 and 3.7 shares (176) (175)
Unearned compensation (ESOP) ( 38) ( 42)
Cumulative translation adjustments (120) ( 68)
______ ______
1,426 1,422
______ ______
Total liabilities and shareholders' investment $4,528 $3,765
______ ______
______ ______
<PAGE>
CUMMINS ENGINE COMPANY, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
Unaudited
____________________________________
First Half Ended
_____________________
Millions 6/28/98 6/29/97
________ _______ _______
Cash flows from operating activities:
Net earnings $ 60 $ 94
____ ____
Adjustments to reconcile net earnings
to net cash from operating activities:
Depreciation and amortization 98 80
Restructuring actions ( 11) ( 10)
Accounts receivable (165) (140)
Inventories ( 48) ( 49)
Accounts payable and accrued expenses 115 74
Income taxes payable ( 6) 10
Equity in (earnings) losses of joint
ventures and alliances 16 ( 4)
Other 17 12
____ _____
Total adjustments 16 ( 27)
____ ____
Net cash provided by operating activities 76 67
____ ____
Cash flows from investing activities:
Property, plant and equipment:
Additions (154) (205)
Disposals 4 8
Investments in joint ventures and alliances ( 6) 2
Acquisition and disposition of businesses (466) 77
Other 1 -
_____ _____
Net cash used in investing activities (621) (118)
_____ _____
Net cash flows used for operating and
investing activities (545) ( 51)
_____ _____
Cash flows from financing activities:
Proceeds from borrowings 711 201
Payments on borrowings (117) ( 10)
Net payments under credit agreements ( 37) ( 52)
Repurchase of common stock - ( 58)
Dividend payments ( 23) ( 22)
Other 3 ( 4)
____ ___
Net cash provided from financing activities 537 55
____ ___
Effect of exchange rate changes on cash ( 1) ( 1)
____ ___
Net change in cash and cash equivalents ( 9) 3
Cash & cash equivalents at beginning of year 49 108
____ ____
Cash & cash equivalents at end of first half $ 40 $111
____ ____
____ ____
<PAGE>
CUMMINS ENGINE COMPANY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Unaudited
__________________________________________
Note 1. Accounting Policies: The Consolidated Financial Statements
for the interim periods ended June 28, 1998 and June 29, 1997 have been
prepared in accordance with the accounting policies described in the
Company's Annual Report to Shareholders and Form 10-K. Management
believes the statements include all adjustments of a normal recurring
nature necessary to present fairly the results of operations for the
interim periods. Inventory values at interim reporting dates are based
upon estimates of the annual adjustments for taking physical inventory
and for the change in cost of LIFO inventories.
Note 2. Acquisition: In January 1998, Cummins completed the
acquisition of the stock of Nelson Industries, Inc., for $453 million.
Nelson, a filtration and exhaust systems manufacturer, was consolidated
from the date of its acquisition. Under APB Opinion No. 16, Nelson's
net assets are to be recorded at fair value at the date of acquisition.
Adjustments required to properly reflect the fair value of Nelson's
assets and liabilities are not expected to have a material effect on
the Company's financial statements. The purchase price in excess of
net assets will be amortized over 40 years.
Note 3. Special Charge: In the first quarter of 1998, the Company
recorded a special charge for product coverage expense primarily
attributable to the recent experience of higher-than-anticipated costs
to repair certain automotive engines manufactured in previous years.
The Company believed it was necessary to make a special charge of $43
million pre-tax to accrue for such product coverage costs expected to
be incurred in the future on these engines currently in the field.
Note 4. Income Taxes: Income tax expense is reported during the
interim reporting periods on the basis of the estimated annual
effective tax rate for the taxable jurisdictions in which the Company
operates.
Note 5. Long-term Debt: In January 1998, the Company's revolving
credit agreement was amended, forming two $500 million agreements
maturing in 1999 and 2003. In February 1998, the Company issued $765
million face amount of notes and debentures. Net proceeds were used to
finance the acquisition of Nelson and pay down other indebtedness
outstanding at December 31, 1997. The $500 million revolving credit
agreement maturing in 1999 was terminated in March 1998, with the
financing need being replaced by the debt issue.
NOTE 6. Earnings per Share: Basic earnings per share of common stock
are computed by dividing net earnings by the weighted-average number of
common shares outstanding during the period. Diluted earnings per
share are computed by dividing net earnings by the weighted-average
number of shares, assuming the exercise of stock options. Shares of
stock held by the employee benefits trust are not included in
outstanding shares for EPS until distributed from the trust.
Second Quarter
________________________________
Weighted Per-
Net Average Share
Millions, except per share amounts Earnings Shares Amount
__________________________________ ________ ________ ______
1998
____
Basic $53 38.5 $1.39
Options - .3
___ ____
Diluted $53 38.8 $1.38
1997
____
Basic $53 38.3 $1.40
Options - .4
___ ____
Diluted $53 38.7 $1.38
First Half
________________________________
Weighted Per-
Net Average Share
Millions, except per share amounts Earnings Shares Amount
__________________________________ ________ ________ ______
1998
____
Basic $60 38.5 $1.57
Options - .3
___ ____
Diluted $60 38.8 $1.55
1997
____
Basic $94 38.3 $2.46
Options - .3
___ ____
Diluted $94 38.6 $2.44
Note 7. Comprehensive Income: Effective January 1, 1998, Cummins
adopted SFAS No. 130, a new accounting rule on reporting comprehensive
income. The new rule requires reporting of comprehensive income, which
includes net income and all other nonowner changes in equity during a
period.
Second Quarter Ended
Millions June 28, 1998 June 29, 1997
________ _____________ _____________
Net income $ 53 $ 53
Foreign currency translation
adjustment (33) 11
Unrealized gains on securities ( 1) -
____ ____
Comprehensive income $ 19 $ 64
____ ____
First Half Ended
Millions June 28, 1998 June 29, 1997
________ _____________ _____________
Net income $ 60 $ 94
Foreign currency translation
adjustment (52) ( 9)
Unrealized gains on securities ( 1) -
_____ _____
Comprehensive income $ 7 $ 85
____ ____
Note 8. Contingency: The Environmental Protection Agency, the U. S.
Department of Justice and the California Air Resources Board
(collectively the government agencies) have raised concerns with diesel
engine manufacturers, including Cummins, about the level of Nitrogen
Oxide (NOx) emissions from diesel engines under certain driving
conditions. The government agencies also have raised concerns about the
strategies that diesel manufacturers have employed to maximize fuel
economy and lessen other pollutants, while also meeting Clean Air Act
standards for NOx emissions. The government agencies have indicated that
they may conclude that diesel manufacturers have been in violation of the
Clean Air Act and have, therefore, issued conditional certificates of
conformity on the 1998 heavy-duty, on highway diesel engine models.
Cummins believes that it is in full compliance with all laws and
regulations regarding emissions. The government agencies have not made
any final determinations or allegations. The industry and Cummins are
engaged in confidential discussions regarding these emissions, the
technical challenges confronted if new emissions standards are imposed,
the commercial impact of the government's policy and legal positions and
related issues. Both the industry and the government agencies are taking
these concerns and discussions very seriously and are working diligently
toward an amicable resolution, but resolution of this matter could have a
material effect on Cummins' results.
<PAGE>
CUMMINS ENGINE COMPANY, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS, CASH FLOW AND FINANCIAL CONDITION
________________________________________________________
Overview
________
Earnings before interest and taxes in the second quarter of 1998 were a
record $99 million, equal to 6.1 percent of sales. This was 22 percent
higher than the second quarter of 1997 on a 17-percent increase in
sales. After the higher interest expense for the acquisition of
Nelson, income taxes and minority interest, the Company's net earnings
were $53 million or $1.38 per share, equal to the second quarter of
1997. Net earnings for the first half of 1998, before the special
charge taken in the first quarter, were $91 million or $2.34 per share
compared to $94 million or $2.44 per share in the first half of 1997.
Including the special charge, net earnings in the first half of 1998
were $60 million or $1.55 per share.
The Company continues to explore ways to further reduce costs over the
long term. The Company expects to reduce its work force by 1,000
positions over the next 12 months through attrition, voluntary
separations and further manufacturing restructuring. These and other
potential cost-reduction measures will likely result in a significant
charge in the third quarter.
Results of Operations
_____________________
Net Sales:
__________
Revenues from sales of engines were 56 percent of the Company's net
sales in the second quarter of 1998, with engine revenues 19 percent
higher than second-quarter 1997 and record unit shipments 22 percent
higher. This variance reflected a mix shift from heavy-duty to
midrange engines in the second quarter of 1998:
Second Quarter First Half
_______________ ________________
Unit Shipments 1998 1997 1998 1997
______________ ______ ______ _______ _______
Midrange Engines 77,300 62,800 142,300 125,800
Heavy-duty Engines 27,400 23,000 54,300 43,800
High-horsepower Engines 2,700 2,600 4,900 4,900
_______ ______ _______ _______
107,400 88,400 201,500 174,500
_______ ______ _______ _______
_______ ______ _______ _______
Revenues from non-engine products, which were 44 percent of net sales
in the second quarter of 1998, were 15 percent higher than the second
quarter of 1997. The major changes within non-engine revenues were in
filtration, with the sales of Nelson included from the date of
acquisition by Cummins, and PowerCare (which includes sales of new
parts and remanufactured parts and engines).
The Company's sales for each of its key markets during the comparative
reporting periods were:
Second Quarter First Half
_______________ _______________
$ Millions 1998 1997 1998 1997
__________ ______ ______ ______ ______
Automotive $ 755 $ 626 $1,439 $1,224
Power Generation 313 302 604 577
Industrial 294 263 563 520
Filtration and Other 273 205 529 379
______ ______ ______ ______
$1,635 $1,396 $3,135 $2,700
______ ______ ______ ______
______ ______ ______ ______
Sales of $755 million in the second quarter of 1998 for automotive
markets were 21 percent higher than the second quarter of 1997. Heavy-
duty truck engine revenues were 27 percent higher than the second
quarter of 1997 on a 28-percent increase in units. In the first half
of 1998, heavy-duty truck engine revenues increased 33 percent over the
year-ago level on a 34-percent increase in units. The higher level of
sales was due to both the strong market and the Company's higher market
share in North America, as well as continued strong demand in Mexico
and European automotive markets. In the second quarter of 1998, the
Company began limited production of the Signature 600, a new electronic
engine designed to capture a larger share of the heavy-duty truck
market.
Revenues from the sales of engines for medium-duty trucks in the second
quarter of 1998 were 6 percent lower than the prior year's quarter on a
9-percent decrease in units. Compared to the first half of 1997,
medium-duty truck engine sales were 12 percent lower in 1998 on a 13
percent decrease in units. In North America, the Company continued to
be affected by Ford's relocation of its production facilities. The
effect of this shutdown was partially offset by higher demand in
international markets, for which second quarter 1998 unit shipments
were 32 percent higher than the year-ago level, primarily in Brazil.
Engine revenues of the bus and light commercial vehicle market were 45
percent higher than the second quarter of 1997 and 26 percent higher
than the first half of 1997. In January, Cummins jointly announced
with Chrysler a new, fully electronic engine -- the ISB -- for the
Dodge Ram pickup. In the second quarter, Cummins shipped 25,600
engines to Chrysler, 9,600 units higher than the year-ago level, due to
both a temporary shutdown at Chrysler in the second quarter of 1997 and
the success of the Company's new turbo diesel engine for the Dodge Ram.
In the second quarter of 1998, the Company's power generation markets
benefited from the consolidation of Cummins India Limited. Without
this, power generation revenues would have been down 6 percent compared
to second quarter 1997 and four percent less than the first half of
1997. Sales of the Company's generator sets continued to reflect
growth in North America, which offset declines in demand for generator
sets in Southeast Asia. Engine sales to generator set assemblers were
down 40 percent in the second quarter due primarily to lower demand in
Asia. Genset sales for the RV market, however, were 15 percent higher
than in the second quarter of 1997.
Sales of engines to industrial markets were 13 percent higher than the
second quarter of 1997, on a 23-percent increase in unit shipments.
The variance between revenues and units resulted from all of the growth
coming from midrange engines. The increased level of sales was due to
continued strong construction volumes in North America and Europe and
higher international sales for agricultural markets.
Filtration and other sales were $68 million higher than the second
quarter of 1997, with Nelson, acquired in January, contributing sales
of $77 million.
In total, international markets represented 46 percent of the Company's
revenues in the second quarter of 1998. The Company continued to
benefit from recovery in European automotive markets and strong
industrial business in the second quarter, with Europe, Africa and the
Middle East representing 15 percent of sales. Business in the Americas
(Canada, Mexico, Brazil and Latin America) also continued to be strong
and represented 18 percent of sales in the second quarter. Asian and
Australian markets, in total, represented 13 percent of the Company's
sales in the second quarter. In Australia, sales are primarily for
automotive, power generation and mining markets. In Asia, sales for
India, China and Japan were flat with the second quarter of 1997.
Revenues in Korea decreased over 70 percent and Southeast Asia was 53
percent below the year-ago quarter.
Gross Margin:
_____________
The Company's gross margin percentage was 22.6 percent in the second
quarter of 1998, compared to 23.2 percent in the prior year's quarter.
The Company's gross margin percentage decreased due to higher product
coverage and new product costs as well as certain production
inefficiencies. This decrease was partially offset by the benefit from
higher volume and parts pricing. In addition, the acquisition of
Nelson and consolidation of Cummins India Limited added $35 million.
For the first half of 1998, gross margin percentage before the special
charge was 22.6 percent, equal to the comparable period in 1997. Gross
margin percentage after the special charge was 21.2 percent in the
first half of 1998.
Operating Expenses:
___________________
Selling and administrative expenses were 12.2 percent of sales in the
second quarter of 1998 and 12.8 percent in the first half of 1998,
compared to 13.3 percent in the second quarter and 13.5 percent in the
first half of 1997. The $13 million incremental cost in the second
quarter was due primarily to Nelson and Cummins India Limited, with
costs of new products, information systems and Year 2000 offset by
spending containment. Research and engineering expenses were 4.0
percent of sales in the second quarter of 1998, compared to 4.6 percent
in the prior year's quarter as a result of new engines moving into
production.
The Company's losses from joint ventures and alliances were $6 million
in the second quarter of 1998 and $10 million in the first half of
1998, compared to income of $2 million in the second quarter of 1997
and $9 million in the first half of 1997. The difference was primarily
caused by the consolidation of Cummins India Limited and higher start-
up costs at the Company's joint venture with Wartsila.
Year 2000:
__________
The Company is continuing its Year 2000 Program efforts to prepare our
computer systems, applications, and products for the Year 2000. Our
Year 2000 Program efforts began in late 1996 and include the use of
existing information technology resources and external consulting
services. The Year 2000 Program is a centrally coordinated, enterprise-
wide effort under the leadership of the Cummins Year 2000 Team. The
Company expects to substantially complete its Year 2000 remediation
efforts by the end of the second quarter of 1999.
Complementing our ongoing communication with our suppliers, the Company
has joined the Automotive Industrial Action Group's Year 2000
Evaluation Program. The AIAG is an industry established organization
that has produced Year 2000 Compliance standards and streamlined the
process of evaluating the Year 2000 readiness of suppliers and others
in the industry. Through the AIAG, the Company has formalized our
inquiries and evaluation of the Year 2000 Compliance status of those
entities with whom we do business. It is already clear that we can
assure our customers that all our electronically controlled engines and
generator sets will transition without disruption in function across
the millennial transition, and continue to operate in 2000 as they did
in 1999.
The Company expects to incur total expenditures of about $45 million to
remedy the Year 2000 problem. To date the Company has expensed about
$10 million, and the Company estimates an expense of about $8 to $10
million for the rest of 1998.
The Company is confident that it will more than meet the challenge
presented by the Year 2000, however the magnitude of the Year 2000
problem and its impact on products, software and embedded technology is
unpredictable and investors are encouraged to keep apprised of
developments during this evolving process.
Other:
______
Interest expense of $18 million in the second quarter of 1998 and $35
million in the first half of 1998 was higher than the comparable
periods of 1997 due to the increased level of borrowings to support
working capital on the higher sales level and to complete the
acquisition of Nelson. Other income decreased $5 million when
comparing both the second quarter and the first half of 1998 to the
year-ago periods. Such decrease is due to the Nelson goodwill
amortization and lower royalty income.
Provision for Income Taxes:
___________________________
The Company's income tax provision in the second quarter of 1998 was $24
million and $28 million in the first half of 1998, reflecting an estimated
effective tax rate of 29 percent for the year.
Cash Flow and Financial Condition
_________________________________
Key elements of cash flows were:
First Half
__________
$ Millions 1998 1997
__________ ____ ____
Net cash used for operating and investing
activities $(545) $(51)
Net cash from financing activities 537 55
Effect of exchange rate changes on cash ( 1) ( 1)
______ _____
Net change in cash and cash equivalents $( 9) $ 3
______ _____
______ _____
In the first half of 1998, net cash used for operating and investing
activities was $545 million. The higher level of net cash requirements
was due primarily to the acquisition of Nelson and planned capital
expenditures of $154 million. In the first quarter of 1998, the
Company issued $765 million face amount of notes and debentures to
support working capital and to complete the acquisition of Nelson.
As disclosed in Note 8, diesel engine manufacturers, including Cummins,
are involved in discussions with the Environmental Protection Agency,
the US Department of Justice and the California Air Resources Board
regarding diesel engine emissions.
FORWARD-LOOKING STATEMENTS
__________________________
The Company has included certain forward-looking statements in this
Management's Discussion and Analysis of Results of Operations, Cash
Flow and Financial Condition. These statements are based on current
expectations, estimates and projections about the industries in which
the Company operates, management's beliefs and various assumptions made
by management which are difficult to predict. Among the factors that
could affect the outcome of the statements are general industry and
market conditions and growth rates. Therefore, actual outcomes and
their impact on the Company may differ materially from what is
expressed or forecasted. The Company undertakes no obligation to
update publicly any forward-looking statements, whether as a result of
new information, future events or otherwise.
PART II. OTHER INFORMATION
___________________________
Item 6. Exhibits and Reports on Form 8-K:
__________________________________________
(a) See the Index to Exhibits on page 13 for a list of exhibits filed
herewith.
(b) The Company was not required to file a Form 8-K during the second
quarter of 1998.
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.
CUMMINS ENGINE COMPANY, INC.
By: /s/Rick J. Mills
_________________
Rick J. Mills
Vice President - Corporate Controller
(Chief Accounting Officer) July 20, 1998
<PAGE>
CUMMINS ENGINE COMPANY, INC.
____________________________
INDEX TO EXHIBITS
_________________
27 Financial Data Schedule (filed herewith)
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-28-1998
<CASH> 40
<SECURITIES> 0
<RECEIVABLES> 975
<ALLOWANCES> 0
<INVENTORY> 767
<CURRENT-ASSETS> 1,981
<PP&E> 3,067
<DEPRECIATION> 1,403
<TOTAL-ASSETS> 4,528
<CURRENT-LIABILITIES> 1,126
<BONDS> 1,168
0
0
<COMMON> 120
<OTHER-SE> 1,306
<TOTAL-LIABILITY-AND-EQUITY> 4,528
<SALES> 3,135
<TOTAL-REVENUES> 3,135
<CGS> 2,469
<TOTAL-COSTS> 2,469
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 35
<INCOME-PRETAX> 95
<INCOME-TAX> 28
<INCOME-CONTINUING> 60
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 60
<EPS-PRIMARY> 1.57
<EPS-DILUTED> 1.55
</TABLE>
