SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15(d) of
the Securities Exchange Act of 1934
For Quarter Ended: June 30, 1997
Commission File Number: 1-5642
DRAVO CORPORATION
(Exact name of registrant as specified in its charter)
Pennsylvania 25-0447860
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
One Oliver Plaza, Pittsburgh, Pennsylvania 15222
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (412) 566-3000
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 each of the registrant's classes of common
stock as of July 31, 1997:
Title of Class Shares Outstanding
Common Stock, $1.00 par value 14,777,620
DRAVO CORPORATION AND SUBSIDIARIES
INDEX
PART I - FINANCIAL INFORMATION
Page No.
Consolidated Balance Sheets at June 30, 1997
and December 31, 1996 3, 4
Consolidated Statements of Earnings for the
Quarters ended June 30, 1997 and 1996 5
Consolidated Statements of Earnings for the
Six Months ended June 30, 1997 and 1996 6
Consolidated Statements of Cash Flows for the
Six Months ended June 30, 1997 and 1996 7, 8
Notes to Consolidated Financial Statements 9-12
Management's Discussion and Analysis of Financial
Condition and Results of Operations 13
PART II - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security
Holders 14
Item 6. Exhibits and Reports on Form 8-K 14
SIGNATURES 15
DRAVO CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets
($ in 000's)
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
(unaudited)
ASSETS
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 510 $ 1,600
Accounts receivable, net 21,328 23,265
Notes receivable, net 768 921
Inventories 16,931 16,481
Other current assets 751 751
Total current assets 40,288 43,018
Advances to and equity in joint ventures 2,563 2,093
Notes receivable 5,572 4,380
Other assets 25,024 25,066
Deferred income taxes 24,853 24,853
Property, plant and equipment 256,361 238,025
Less: accumulated depreciation and
amortization 116,524 112,026
Net property, plant and equipment 139,837 125,999
Total assets $238,137 $225,409
</TABLE>
See accompanying notes to consolidated financial statements.
DRAVO CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets
($ in 000's)
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
(unaudited)
LIABILITIES AND SHAREHOLDERS' EQUITY
<S> <C> <C>
Current liabilities:
Current portion of long-term notes $ 6,356 $ 6,166
Accounts payable - trade 11,597 14,542
Accrued insurance 3,468 1,906
Accrued retirement contribution 1,810 1,785
Net liabilities of discontinued operations 5,772 6,299
Other current liabilities 4,148 3,843
Total current liabilities 33,151 34,541
Long-term notes 74,265 63,535
Net liabilities of discontinued operations 5,492 6,786
Other liabilities 7,064 6,632
Redeemable preference stock:
Par value $1, issued 200,000 shares:
Series D, $12.35 cumulative, convertible,
exchangeable (entitled in liquidation to
$20.0 million) 20,000 20,000
Shareholders' equity:
Preference stock, par value $1, authorized
1,878,870: Series B, $2.475 cumulative,
convertible; issued 19,386 and 20,386 shares
(entitled in liquidation to $1.1 million); 19 20
Series D, reported above
Common stock, par value $1, authorized
35,000,000 shares; issued 15,100,033
and 15,096,817 15,100 15,097
Other capital 63,063 63,077
Retained earnings 24,190 20,063
Treasury stock at cost:
Common shares 322,413 and 333,168 (4,207) (4,342)
Total shareholders' equity 98,165 93,915
Total liabilities and shareholders' equity $238,137 $225,409
</TABLE>
See accompanying notes to consolidated financial statements.
DRAVO CORPORATION AND SUBSIDIARIES
Consolidated Statements of Earnings
(unaudited, $ in 000's, except per share data)
<TABLE>
<CAPTION>
Quarters ended June 30,
1997 1996
<S> <C> <C>
Revenue $ 42,435 $ 39,349
Cost of revenue 30,908 30,004
Gross profit 11,527 9,345
Selling, general and administrative expenses 5,497 5,252
Earnings from operations 6,030 4,093
Other income (expense):
Equity in earnings of joint ventures 174 234
Other expense (9) -
Interest income 50 868
Interest expense (1,607) (1,640)
Net other income (expense) (1,392) (538)
Earnings before taxes 4,638 3,555
Provision for income taxes 326 107
Net earnings 4,312 3,448
Preference dividends 629 633
Net earnings available
for common shares $ 3,683 $ 2,815
Earnings per share:
Operations $ 0.25 $ 0.19
Weighted average shares outstanding 14,818 14,894
</TABLE>
See accompanying notes to consolidated financial statements.
DRAVO CORPORATION AND SUBSIDIARIES
Consolidated Statements of Earnings
(unaudited, $ in 000's, except per share data)
<TABLE>
<CAPTION>
Six Months ended June 30,
1997 1996
<S> <C> <C>
Revenue $ 80,059 $ 77,573
Cost of revenue 60,759 58,490
Gross profit 19,300 19,083
Selling, general and administrative expenses 10,781 10,323
Earnings from operations 8,519 8,760
Other income (expense):
Equity in earnings of joint ventures 373 468
Other expense (9) -
Interest income 82 868
Interest expense (3,169) (3,336)
Net other income (expense) (2,723) (2,000)
Earnings before taxes 5,796 6,760
Provision for income taxes 410 203
Net earnings 5,386 6,557
Preference dividends 1,259 1,266
Net earnings available
for common shares $ 4,127 $ 5,291
Earnings per share:
Operations $ 0.28 $ 0.36
Weighted average shares outstanding 14,851 14,859
</TABLE>
See accompanying notes to consolidated financial statements.
DRAVO CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(unaudited, $ in 000's)
<TABLE>
<CAPTION>
Six Months ended June 30,
1997 1996
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings $ 5,386 $ 6,557
Adjustments to reconcile net earnings
to net cash provided (used) by continuing
operations activities:
Depreciation and amortization 5,007 5,641
Loss on disposal of assets 9 -
Equity in joint ventures (470) (458)
Changes in assets and liabilities:
Decrease (increase) in accounts receivable 1,937 (2,856)
Decrease (increase) in notes receivable (1,039) 442
Increase in inventories (450) (2,554)
Decrease (increase) in other current assets 62 (146)
Decrease in accounts payable
and accrued expenses (1,069) (5,412)
Increase (decrease) in taxes payable 77 (120)
Decrease in other assets 42 422
Increase in other liabilities 432 132
Net cash provided by continuing
operations activities 9,924 1,648
Net cash provided (used) by discontinued
operations activities (1,821) 6,385
Net cash provided by operating
activities 8,103 8,033
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property, plant and equipment (18,854) (8,075)
Other, (net) - (1)
Net cash used by investing activities $ (18,854) $ (8,076)
</TABLE>
See accompanying notes to consolidated financial statements.
DRAVO CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(unaudited, $ in 000's)
<TABLE>
<CAPTION>
Six Months ended June 30,
1997 1996
<S> <C> <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowing under revolving credit
agreements $ 15,390 $ 6,901
Principal payments under long-term notes (6,133) (6,007)
Proceeds from issuance of common stock 1,663 48
Dividends on preference stock (1,259) (1,266)
Net cash provided (used) by financing
activities 9,661 (324)
Net decrease in cash and cash
equivalents (1,090) (367)
Cash and cash equivalents at beginning of
period 1,600 1,086
Cash and cash equivalents at end of period $ 510 $ 719
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest (net of amount capitalized) $ 3,183 $ 3,347
Income taxes 336 323
</TABLE>
See accompanying notes to consolidated financial statements.
DRAVO CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(1) Basis of Presentation
The accompanying consolidated financial statements include the accounts of
Dravo Corporation and its majority-owned subsidiaries (the company).
The principal subsidiary is Dravo Lime Company, one of the nation's
largest lime producers. Significant intercompany balances and
transactions have been eliminated in the consolidation process.
These unaudited consolidated financial statements include all adjustments,
consisting only of normal, recurring accruals, which management
considers necessary for a fair presentation of the company's
consolidated financial position, results of operations, and cash flows
for the interim periods presented.
(2) Inventories
<TABLE>
Inventories are classified as follows:
<CAPTION>
($ in 000's)
June 30, December 31,
1997 1996
<S> <C> <C>
Finished goods $ 2,809 $ 2,586
Materials and supplies 14,122 13,895
Net inventories $16,931 $16,481
</TABLE>
Finished goods are valued at average production cost or market, whichever
is lower, and include raw materials, direct labor, and operating
overhead. Materials and supplies are valued at average cost.
(3) Contingent Liabilities
The company has been notified by the federal Environmental Protection
Agency (EPA) that the EPA believes the company is a potentially
responsible party (PRP) for the clean-up of soil and groundwater
contamination at four sub-sites in Hastings, NE. The Hastings site is
one of the EPA's priority sites for taking remedial action under the
Comprehensive Environmental Response, Compensation and Liability Act
(CERCLA).
The company participated in an EPA-initiated allocation proceeding for
a municipal landfill sub-site to allocate shares of liability for past
response costs and costs of a proposed cap of the landfill. As part
of this proceeding, the allocator conducted a mediation session which
resulted in a settlement among the EPA and the PRPs. Pursuant to the
settlement, the company agreed to pay $702,000, or 14.33 percent of
the $4.9 million past costs and estimated source control costs for
this sub-site. A Consent Order incorporating the settlement and an
DRAVO CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(3) Contingent Liabilities (continued)
agreement among the private parties concerning the construction and
maintenance of the proposed cap is being negotiated. In exchange, the
company received contribution protection against third-party claims as
well as a covenant from the EPA not to sue for its past and future
response costs at this sub-site and matters covered by the settlement.
The company has also been notified by the EPA that the EPA considers
it a PRP at another municipal landfill in Hastings. At least three
other parties (including the City of Hastings) are considered by the
EPA to be PRPs at this second sub-site. At this sub-site, the company
has concluded that the City of Hastings is primarily responsible for
proper closure of the landfill and the remediation of any release of
hazardous substances. In January, 1994, the EPA invited the company
and the other PRPs to make an offer to conduct a remedial
investigation and feasibility study (RI/FS) of this sub-site and
stated that the EPA was in the process of preparing a work plan for
the RI/FS. None of the PRPs accepted EPA's invitation to perform the
RI/FS for this sub-site. The EPA has conducted the remedial
investigation.
With respect to the third sub-site, the company and two other PRPs
have been served with administrative orders directing them to
undertake soil remediation and interim groundwater remediation at that
sub-site. The company is currently complying with these orders while
reserving its right to seek reimbursement from the United States for
its costs if it is determined it is not liable for response costs or
if it is required to incur costs because of arbitrary, capricious or
unreasonable requirements imposed by the EPA.
The EPA has taken no legal action with respect to its demand that the
company and the other PRPs pay its past response costs. A total of five
parties have been named by the EPA as PRPs at this sub-site, but two of
them have been granted de minimis status. The company believes other
persons should also be named as PRPs.
The fourth sub-site is a former naval ammunition depot which was
subsequently converted to an industrial park. The company and its
predecessor owned and operated a manufacturing facility in this
industrial park. To date, the company's investigation indicates that it
did not cause the release of hazardous substances at this sub-site
during the time it owned and operated the facility. The United States
has undertaken to conduct the remediation of this sub-site.
In addition to sub-site clean-up, the EPA is seeking a clean-up of
area-wide contamination associated with all of the sub-sites in and
around Hastings, NE. The company, along with other Hastings PRPs, has
recommended that the EPA adopt institutional controls as the area-wide
remedy in Hastings. EPA has completed an area wide remedial
investigation and has indicated it will ask the PRPs to agree to perform
a study to determine feasible remediation alternatives.
On August 10, 1992, the company filed suit in the Alabama District
Court against its primary liability insurance carriers and one of
its predecessor's insurers, seeking a declaratory judgment that
the company is entitled to a defense and indemnity under its
contracts of insurance (including certain excess policies provided
by one of the primary carriers) with regard to the third Hastings
sub-site. On motion of the defendant insurance carriers, the suit
was transferred to the District
DRAVO CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(3) Contingent Liabilities (continued)
Court for the Western District of Pennsylvania on October 31, 1996. The
company has settled the claim against its predecessor's insurer, but the
case against the company's insurers is still in litigation. An award of
punitive damages is also being sought against the company's insurers for
their bad faith in failing to investigate the company's claim and/or
denying the company's claim. The company has notified its primary and
excess general liability carrier, as well as the excess carrier of its
predecessor, of the receipt of its notice of potential liability at the
second and fourth sub-sites.
Estimated total clean-up costs, including capital outlays and future
maintenance costs for soil and groundwater remediation of approximately
$14 million, are based on independent engineering studies. Included in
the discontinued operations provision is the company's estimate that it
will participate in 33 percent of these remediation costs. The
company's estimated share of the costs is based on its assessment of the
total clean-up costs, its potential exposure, and the viability of other
named PRPs. These estimates are, by their nature, uncertain and
dependent upon numerous factors, any of which could cause actual results
to differ materially from projected amounts.
Other claims and assertions made against the company will be resolved,
in the opinion of management, without material additional charges to
earnings.
(4) Discontinued Operations
Discontinued operations' assets and liabilities at June 30, 1997 and
December 31, 1996 relate to non-cancelable leases, insurance,
environmental, legal and other matters associated with exiting the
engineering and construction business and are presented below:
<TABLE>
<CAPTION>
($ in 000's) June 30, December 31,
1997 1996
<S> <C> <C>
Current assets:
Accounts and retainers receivable $ 284 $ 323
Total current assets 284 323
Other 309 309
Total assets $ 593 $ 632
Current liabilities:
Accounts and retainers payable $ 536 $ 536
Accrued loss on leases 2,354 2,304
Other 3,166 3,782
Total current liabilities 6,056 6,622
Accrued loss on leases - 954
Other 5,801 6,141
Total liabilities $ 11,857 $ 13,717
Net liabilities and accrued loss
on leases of discontinued operations $(11,264) $ (13,085)
</TABLE>
DRAVO CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(5) Earnings Per Share
In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 128, Earnings per
Share (FAS 128). FAS 128 supersedes APB Opinion No. 15, Earnings per
Share (APB 15) and requires the calculation and dual presentation of
Basic and Diluted earnings per share, replacing the measures of
Primary and Fully-diluted earnings per share as reported under APB 15.
FAS 128 is effective for financial statements issued for periods
ending after December 15, 1997; earlier application is not permitted.
After the effective date, all prior-period earnings per share data
presented must be restated to conform with the provisions of FAS 128.
The impact of FAS 128 on the company's earnings per share calculation
will be immaterial.
DRAVO CORPORATION AND SUBSIDIARIES
Management's Discussion and Analysis of Financial
Condition and Results of Operations
Revenue of $42.4 million and gross profit of $11.5 million were up 8 and
23 percent, respectively, over last year's second quarter. Stronger
lime demand, especially in the Ohio Valley utility market, contributed
to the revenue improvement. This year's higher revenue and $2.2 million
gross profit increase over last year highlights the company's
sensitivity to major customers' operating disruptions as last year's
results were depressed due to mechanical problems at a major electric
utility customer. Selling, general and administrative expenses were
higher for the quarter primarily due to recognition of a bad debt
accrual on a note receivable associated with the company's former
aggregates business. The effective income tax rate is higher this year
primarily due to an accrual for alternative minimum tax. Last year's
earnings were bolstered by refunds received from a state taxing
authority for amended returns filed based on current interpretation of
the state tax code. The refunds included interest income of $851,000.
Year-to date earnings of $5.4 million, or 28 cents per share, were down
from last year's $6.6 million, or 36 cents per share. The shortfall can
be attributed to this year's poor first quarter earnings of $1.1
million, or three cents per share. As reported previously, an early
March flood in northern Kentucky stopped the company from loading barges
and its customers from unloading barges for an extended period. The
flood, barge unloading equipment problems at a major utility customer's
plant and other brief, but unscheduled power plant outages, severely
impacted utility lime sales. Further, the company's Longview operation
in northern Alabama experienced operating related disruptions during the
first quarter that also contributed to lower earnings. Longview's
largest kiln had to be shut down several days for major maintenance work
that was scheduled to occur later in the year. Lower production
required the purchase of lime from outside sources to meet contractual
requirements and maintain key customer relationships. Consequently,
profit margins were reduced because purchased lime costs more than
company produced lime.
Capital expenditures for the year-to-date were $18.9 million compared to
$8.1 million last year. Construction progress payments for a new
Maysville kiln and the $7.4 million purchase of more than 27 million
tons of high calcium reserves adjacent to the Longview facility
accounted for a large part of the additions to property, plant and
equipment. Long-term debt increased $10.7 million from year-end
primarily due to funding capital expenditures.
On July 31, 1997, a three-bank lending group extended the company's
revolving line of credit facility to July 31, 1999. The maximum amount
available under the facility is $53 million. Under the agreement, $17
million borrowed under the facility to finance the Maysville expansion
project was converted to a 5-year term loan. The term loan will be paid
in 20 quarterly installments commencing October 31, 1997 with interest
determined quarterly based on the Eurodollar rate plus 2 percent.
The company announced on July 7, 1997 that the investment banking review
initiated in the fall of 1996 to explore strategic alternatives failed
to produce a transaction favorable to the best interests of the
company's shareholders. As a result, the company has concluded the
review.
DRAVO CORPORATION AND SUBSIDIARIES
PART II - Other Information
Item 4. Submission of Matters to a Vote of Security Holders
The annual meeting of shareholders was held on April 24, 1997 in
Cincinnati, Ohio. Listed below are the proposals submitted to
shareholders in the company's Proxy Statement dated March 31,
1997 and the results of the shareholder votes.
Election of three directors for a three year term:
<TABLE>
<CAPTION>
For Against
<S> <C> <C> <C>
William E. Kassling 13,313,393 305,563
Peter T. Kross 13,308,557 310,399
Konrad M. Weis 13,313,654 305,302
</TABLE>
Following the election, the company's Board of Directors
consisted of Mr. Arthur E. Byrnes, Mr. James C. Huntington, Jr.,
Mr. Carl A. Gilbert, Mr. Kassling, Mr. Kross, Mr. William G.
Roth, and Mr. Weis.
Election of Certified Public Accountants:
<TABLE>
<CAPTION>
For Against Abstain
<S> <C> <C> <C>
KPMG Peat Marwick LLP 13,493,357 6,245 119,354
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
The following is filed as an exhibit to Part I of this Form 10-Q:
Exhibit No. 11 - Statement re computation of per share earnings.
(b) Reports on Form 8-K
The company filed no reports on Form 8-K for the quarter ended
June 30, 1997.
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.
DRAVO CORPORATION
(Registrant)
Date: August 13, 1997 /s/JAMES J. PUHALA
James J. Puhala
Vice President, General
Counsel, Secretary and Acting
Chief Financial Officer
Date: August 13, 1997 /s/LARRY J. WALKER
Larry J. Walker
Vice President and Controller
(Principal Accounting Officer)
</TABLE>
Exhibit 11. Statement Re Computation of Per Share Earnings
<TABLE>
(In 000's, except per share data)
<CAPTION>
Quarters ended June 30,
Primary 1997 1996
<S> <C> <C>
Earnings:
Net earnings $ 4,312 $ 3,448
Deduct dividends on preference stock 629 633
Net earnings applicable to common stock $ 3,683 $ 2,815
Shares:
Weighted average number of common
shares outstanding 14,776 14,723
Dilutive effect of outstanding
options and rights (as determined
by the application of the treasury
stock method at the average market
price for the period) 42 171
Weighted average number of shares
outstanding, as adjusted 14,818 14,894
Primary earnings per share $ 0.25 $ 0.19
Fully diluted
Earnings:
Net earnings $ 4,312 $ 3,448
Deduct dividends on preference stock (1) 629 633
Net earnings applicable to common stock $ 3,683 $ 2,815
Shares:
Weighted average number of common
shares outstanding 14,776 14,723
Dilutive effect of outstanding
options and rights (as determined
by the application of the treasury
stock method at the higher of the
closing or the average market price
for the period) 49 243
Weighted average number of shares
outstanding, as adjusted 14,825 14,966
Fully diluted earnings per share $ 0.25 $ 0.19
</TABLE>
Exhibit 11. Statement Re Computation of Per Share Earnings (continued)
<TABLE>
(In 000's, except per share data)
<CAPTION>
Quarters ended June 30,
1997 1996
Additional Fully Diluted Computation (2)
Earnings:
<S> <C> <C>
Net earnings $ 4,312 $ 3,448
Shares:
Weighted average number of common shares
outstanding 14,776 14,723
Dilutive effect of outstanding options and
rights (as determined by the application of
the treasury stock method at the higher of
the closing or average market price for
the period) 49 243
Shares issuable from assumed exercise of
convertible preference stock 1,663 1,682
Weighted average number of shares
outstanding, as adjusted 16,488 16,648
Fully diluted earnings per share $ 0.26 $ 0.21
</TABLE>
(1) The inclusion of preference stock in the fully dilutive computation would
have an anti-dilutive effect on earnings per share.
(2) This calculation is submitted in accordance with Securities Exchange Act
of 1934, Regulation S-K, paragraph 229.601 (b)(11) although it is contrary to
paragraph 40 of APB Opinion No. 15 because it produces an anti-dilutive
result.
Exhibit 11. Statement Re Computation of Per Share Earnings
<TABLE>
(In 000's, except per share data)
<CAPTION>
Six Months ended June 30,
Primary 1997 1996
<S> <C> <C>
Earnings:
Net earnings $ 5,386 $ 6,557
Deduct dividends on preference stock 1,259 1,266
Net earnings applicable to common stock $ 4,127 $ 5,291
Shares:
Weighted average number of common
shares outstanding 14,773 14,716
Dilutive effect of outstanding
options and rights (as determined
by the application of the treasury
stock method at the average market
price for the period) 78 143
Weighted average number of shares
outstanding, as adjusted 14,851 14,859
Primary earnings per share $ 0.28 $ 0.36
Fully diluted
Earnings:
Net earnings $ 5,386 $ 6,557
Deduct dividends on preference stock (1) 1,259 1,266
Net earnings applicable to common stock $ 4,127 $ 5,291
Shares:
Weighted average number of common
shares outstanding 14,773 14,716
Dilutive effect of outstanding
options and rights (as determined
by the application of the treasury
stock method at the higher of the
closing or the average market price
for the period) 78 243
Weighted average number of shares
outstanding, as adjusted 14,851 14,959
Fully diluted earnings per share $ 0.28 $ 0.35
</TABLE>
<TABLE>
Exhibit 11. Statement Re Computation of Per Share Earnings (continued)
<CAPTION>
(In 000's, except per share data)
Six Months ended June 30,
1997 1996
Additional Fully Diluted Computation (2)
Earnings:
<S> <C> <C>
Net earnings $ 5,386 $ 6,557
Shares:
Weighted average number of common shares
outstanding 14,773 14,716
Dilutive effect of outstanding options and
rights (as determined by the application of
the treasury stock method at the higher of
the closing or average market price for
the period) 78 243
Shares issuable from assumed exercise of
convertible preference stock 1,663 1,682
Weighted average number of shares
outstanding, as adjusted 16,514 16,641
Fully diluted earnings per share $ 0.33 $ 0.39
</TABLE>
(1) The inclusion of preference stock in the fully dilutive computation would
have an anti-dilutive effect on earnings per share.
(2) This calculation is submitted in accordance with Securities Exchange Act
of 1934, Regulation S-K, paragraph 229.601 (b)(11) although it is contrary to
paragraph 40 of APB Opinion No. 15 because it produces an anti-dilutive
result.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM DRAVO
CORPORATION'S JUNE 30, 1997 FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 510
<SECURITIES> 0
<RECEIVABLES> 21546
<ALLOWANCES> 218
<INVENTORY> 16931
<CURRENT-ASSETS> 40288
<PP&E> 256361
<DEPRECIATION> 116524
<TOTAL-ASSETS> 238137
<CURRENT-LIABILITIES> 33151
<BONDS> 0
<COMMON> 15100
20000
19
<OTHER-SE> 83046
<TOTAL-LIABILITY-AND-EQUITY> 238137
<SALES> 80059
<TOTAL-REVENUES> 80059
<CGS> 60759
<TOTAL-COSTS> 60759
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3169
<INCOME-PRETAX> 5796
<INCOME-TAX> 410
<INCOME-CONTINUING> 5386
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5386
<EPS-PRIMARY> .28
<EPS-DILUTED> 0
</TABLE>
