UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] Quarterly report pursuant to Section 13 or 15 (d)
of the Securities Exchange Act of 1934
for the quarterly period ended July 31, 1996.
[ ] Transition report pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Commission file number 1-4003
DRESSER INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Delaware C 75-0813641
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
P. O. Box 718
2001 Ross 75221 (P. O. Box)
Dallas, Texas 75201
(Address of principal executive (Zip Code)
offices)
Registrant's telephone number, including area code - 214-740-6000
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, 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.
Class Outstanding at August 31, 1996
Common Stock, par value $.25 175,707,067
INDEX
Page
Number
Part I. Financial Information
Management's Representation 3
Condensed Consolidated Statements of Earnings
for the three months and the nine months ended
July 31, 1996 and 1995 4
Condensed Consolidated Balance Sheets
as of July 31, 1996 and October 31, 1995 5
Condensed Consolidated Statements of Cash Flows
for the nine months ended July 31, 1996 and 1995 6
Notes to Condensed Consolidated Financial Statements 7-11
Management's Discussion and Analysis of Financial
Condition and Results of Operations 12-16
Part II. Other Information 17
Signature 17
Exhibit Index
Exhibit 27 Financial Data Schedule
MANAGEMENT'S REPRESENTATION
The condensed consolidated financial statements included herein have been
prepared by the Company pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations. The Company believes that the
disclosures are adequate to make the information presented not misleading.
These condensed consolidated financial statements should be read in
conjunction with the consolidated financial statements, the notes to
consolidated financial statements and management's discussion and analysis
included in the Company's 1995 Annual Report on Form 10-K.
In the opinion of the Company, all adjustments have been included that
were necessary to present fairly the financial position of Dresser
Industries, Inc. and subsidiaries as of July 31, 1996 and October 31, 1995,
the results of operations for the three months and the nine months ended
July 31, 1996 and 1995, and cash flows for the nine months ended July 31,
1996 and 1995. These adjustments consisted of normal recurring adjustments.
The results of operations for such interim periods do not necessarily
indicate the results for the full year.
<TABLE>
DRESSER INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(In Millions Except per Share Data)
<CAPTION>
Three Months Ended Nine Months Ended
July 31, July 31,
1996 1995 1996 1995
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Revenues $ 1,638.0 $ 1,437.4 $ 4,730.5 $ 3,998.9
Cost of revenues (1,268.4) (1,118.5) (3,690.7) (3,102.8)
Gross earnings 369.6 318.9 1,039.8 896.1
Selling, engineering, administra-
tive and general expenses (244.7) (234.0) (724.8) (670.7)
Other income (deductions)
Interest expense, net (12.7) (8.1) (33.6) (16.4)
Other, net 0.5 0.2 (3.9) 0.4
Earnings before items below 112.7 77.0 277.5 209.4
Income taxes (38.4) (25.4) (94.4) (69.1)
Minority interest (6.0) (6.6) (11.0) (11.6)
Earnings before accounting
change 68.3 45.0 172.1 128.7
Cumulative effect of accounting
change, net of tax - - - (16.0)
Net earnings $ 68.3 $ 45.0 $ 172.1 $ 112.7
Earnings per common share
Earnings from operations $ .38 $ .25 $ .95 $ .71
Cumulative effect of accounting
change - - - (.09)
Net earnings $ .38 $ .25 $ .95 $ .62
Cash dividends per common
share $ .17 $ .17 $ .51 $ .51
Average common shares
outstanding 178.4 182.4 180.5 182.9
See accompanying Notes to Condensed Consolidated Financial Statements.
</TABLE>
<TABLE>
DRESSER INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Millions)
<CAPTION>
July 31, October 31,
ASSETS 1996 1995
Current Assets (Unaudited)
<S> <C> <C>
Cash and cash equivalents $ 158.9 $ 248.7
Notes and accounts receivable, net 1,063.6 963.7
Inventories, net 907.7 809.4
Deferred income taxes 84.5 84.8
Other current assets 296.9 94.6
Total Current Assets 2,511.6 2,201.2
Investments in and receivables from
unconsolidated affiliates 179.7 201.9
Goodwill, net 873.0 845.2
Deferred income taxes 188.6 188.9
Other assets 154.9 143.1
Property, plant and equipment - at cost 2,770.4 2,572.9
Accumulated depreciation and amortization 1,558.5 1,445.8
Net Property 1,211.9 1,127.1
Total Assets $5,119.7 $4,707.4
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Short-term debt $ 345.0 $ 131.6
Accounts payable 491.6 520.4
Contract advances 646.8 324.4
Accrued compensation and benefits 236.0 237.7
Income taxes 105.0 113.2
Other current liabilities 402.3 385.1
Total Current Liabilities $2,226.7 $1,712.4
Employee retirement and postemployment
benefit obligations 680.1 689.2
Long-term debt 457.5 459.3
Deferred compensation, insurance
reserves and other liabilities 105.9 110.7
Minority interest 138.1 79.0
Shareholders' Equity
Common shares 46.2 46.1
Capital in excess of par value 454.7 451.6
Retained earnings 1,335.2 1,285.4
Cumulative translation adjustments (101.0) (76.7)
Pension liability adjustment (7.0) (7.0)
1,728.1 1,699.4
Less treasury shares, at cost 216.7 42.6
Total Shareholders' Equity 1,511.4 1,656.8
Total Liabilities and
Shareholders' Equity $5,119.7 $4,707.4
Actual common shares outstanding 176.8 182.4
See accompanying Notes to Condensed Consolidated Financial Statements.
</TABLE>
<TABLE>
DRESSER INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Millions)
<CAPTION>
Nine Months Ended
July 31,
1996 1995
(Unaudited)
Cash flows from operating activities:
<S> <C> <C>
Net earnings $ 172.1 $ 112.7
Adjustments to reconcile net earnings
to cash flow:
Depreciation and amortization 167.0 152.2
Cumulative effect of accounting
change, net of tax - 16.0
Equity earnings from
unconsolidated affiliates (20.2) (12.6)
Minority interest 11.0 11.6
Changes in working capital (116.4) (25.1)
Other - net 4.4 3.5
Net cash provided by operating
activities 217.9 258.3
Cash flows from investing activities:
Capital expenditures (223.7) (193.3)
Business acquisitions (29.5) (325.7)
Cash of acquired businesses 3.3 8.6
Net cash used by investing
activities (249.9) (510.4)
Cash flows from financing activities:
Dividends paid (92.3) (93.2)
Purchases of common shares for
Treasury (191.4) (40.1)
Issuance of common shares 18.0 3.7
Increase in short-term debt 213.4 129.9
Decrease in long-term debt (1.8) (13.2)
Net cash used by financing
activities (54.1) ( 12.9)
Effect of translation adjustments on
cash (3.7) 2.2
Net decrease in cash and cash
equivalents (89.8) (262.8)
Cash and cash equivalents,
beginning of period 248.7 515.0
Cash and cash equivalents,
end of period $ 158.9 $ 252.2
See accompanying Notes to Condensed Consolidated Financial Statements.
</TABLE>
DRESSER INDUSTRIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
July 31, 1996
(Unaudited)
<TABLE>
Note A - Information by Industry Segment (In Millions)
<CAPTION>
Three Months Ended Nine Months Ended
July 31, July 31,
1996 1995 1996 1995
Revenues
Petroleum Products and Services
Drilling and Production
<S> <C> <C> <C> <C>
Operations $ 386.8 $ 327.9 $1,108.8 $ 935.4
Kellogg Oil and Gas
Services 167.3 102.6 433.4 225.6
554.1 430.5 1,542.2 1,161.0
Engineering Services
M. W. Kellogg Operations 391.0 393.9 1,249.4 1,055.4
Energy Equipment
Compression and Pumping 315.8 282.5 856.2 821.7
Measurement 154.3 150.5 456.1 448.2
Flow Control 157.8 125.0 453.7 322.3
Power Systems 70.4 64.6 213.9 204.3
698.3 622.6 1,979.9 1,796.5
Eliminations (5.4) (9.6) (41.0) (14.0)
Total revenues $1,638.0 $1,437.4 $4,730.5 $3,998.9
Operating profit
Petroleum Products and Services
Drilling and Production
Operations $ 50.3 $ 37.2 $ 145.7 $ 101.2
Kellogg Oil and Gas Services 11.1 6.2 25.7 6.8
61.4 43.4 171.4 108.0
Engineering Services 24.7 15.8 65.6 48.7
Energy Equipment
Compression and Pumping 26.7 21.6 56.0 44.7
Measurement 12.8 14.1 34.0 48.3
Flow Control 17.8 12.0 46.6 28.2
Power Systems 9.8 5.3 22.2 24.8
67.1 53.0 158.8 146.0
Total segment
operating profit 153.2 112.2 395.8 302.7
Amortization of acquisition
intangibles (7.3) (7.5) (23.5) (21.3)
General corporate expenses (20.5) (19.6) (61.2) (55.6)
Interest expense, net (12.7) (8.1) (33.6) (16.4)
Earnings before taxes,
minority interest and
accounting change $ 112.7 $ 77.0 $ 277.5 $ 209.4
</TABLE>
Note B - Accounting Change
Effective November 1, 1994, Dresser Industries, Inc. (the Company) changed
its accounting for postemployment benefits as required by Statement of
Financial Accounting Standards No. 112, Employers Accounting for
Postemployment Benefits (SFAS 112). Postemployment benefits include salary
continuation, disability and health care for former or inactive employees
who are not retired. Medical benefits for employees on long-term disability
are the most significant of these benefits. SFAS 112 requires accrual of
the cost of these benefits currently. The Company had previously accrued the
liability for salary continuation but had accounted for the other benefits
as benefits were paid. The Condensed Consolidated Statement of Earnings for
the nine months ended July 31, 1995 includes a charge of $16.0 million (net
of tax of $9.0 million) or $0.09 per share for the cumulative effect of the
accounting change.
Note C - Unconsolidated Affiliated Companies
The Company has several investments in less than majority owned affiliates.
A summary of the impact of these investments on the condensed consolidated
financial statements follows (in millions):
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
July 31, July 31,
1996 1995 1996 1995
Share of earnings of unconsoli-
dated affiliates
Ingersoll-Dresser Pump (49%
<S> <C> <C> <C> <C>
owned) $ 4.7 $ 3.0 $ 16.4 $ 10.8
Other affiliates 1.7 (1.5) 3.8 1.8
$ 6.4 $ 1.5 $ 20.2 $ 12.6
</TABLE>
<TABLE>
<CAPTION>
July 31, October 31,
1996 1995
Investments in and receivables
from unconsolidated affili-
ates
Ingersoll-Dresser Pump (49%
<S> <C> <C>
owned) $ 130.1 $ 143.0
Other affiliates 49.6 58.9
$ 179.7 $ 201.9
</TABLE>
Note D - Inventories
The determination of inventory values and cost of sales under the LIFO method
for interim financial results is based on management's estimates of expected
year-end inventories.
Inventories include the following (in millions):
<TABLE>
<CAPTION>
July 31, October 31,
1996 1995
Finished products and work in
<S> <C> <C>
process $ 699.4 $ 617.7
Raw materials and supplies 208.3 191.7
$ 907.7 $ 809.4
</TABLE>
Note E - Dividends
On July 18, 1996, the Company declared a quarterly dividend of $.17 per
share of common stock payable on September 20, 1996 to shareholders of
record on September 3, 1996.
Note F - Litigation and Contingencies
The Company is involved in certain legal actions and claims arising in the
ordinary course of business. See Note J - Commitments and Contingencies -
in the Company's 1995 Annual Report on Form 10-K for a complete discussion
of these matters. A discussion of significant changes subsequent to
October 31, 1995 follows.
Quantum Chemical Litigation
In October 1992, Quantum Chemical Corporation ("Quantum") brought suit
against the Company's wholly owned subsidiary, The M. W. Kellogg Company
("Kellogg"), seeking $200 million in actual damages and twice that amount
in punitive damages. Kellogg answered denying the claim and filed a
counterclaim against Quantum alleging libel, slander, breach of contract
and fraud. The case was tried during 1995. On November 30, 1995, the
jury returned a verdict finding that Quantum's claim was barred by the
statute of limitations and that Quantum is liable for damages for breach of
contract, damages for theft of trade secrets and Kellogg's legal fees.
The Court entered a judgment on the verdict on February 5, 1996 which
awarded Kellogg $13.7 million. Quantum has filed its bond on appeal, and
the Company believes that Quantum will continue the steps necessary to
appeal the judgment. The Company has not recognized any income from the
judgment.
Asbestosis Litigation
The Company has approximately 64,700 pending claims at July 31, 1996,
with approximately 14,400 new claims filed and approximately 18,500 claims
resolved during the first three quarters of the fiscal year. Certain
settlements, previously reported, including approximately 16,500
in Mississippi, approximately 4,400 in New York, and approximately 3,000
in Texas are carried as pending until releases are signed. Resolution of
these claims will reduce the number of pending claims at July 31, 1996,
by approximately 40% for refractory product claims and 35% for non-refractory
product claims.
Management recognizes the uncertainties of litigation and the possibility
that one or more adverse rulings could materially impact operating results.
However, based upon the nature of and management's understanding of the facts
and circumstances which gave rise to such actions and claims, management
believes that such litigation and claims will be resolved without material
effect on the Company's financial position or results of operations.
Note G - Baroid Financial Information
Dresser Industries, Inc. (Dresser) merged with Baroid Corporation (Baroid)
on January 21, 1994. Baroid has ceased filing periodic reports with the
Securities and Exchange Commission. Baroid's 8% Senior Notes (the Notes)
remain outstanding and are fully guaranteed by the Company. Since the Notes
remain outstanding, summarized financial information of Baroid is presented
as follows (in millions):
<TABLE>
<CAPTION>
July 31, October 31,
Baroid Corporation 1996 1995
<S> <C> <C>
Current assets $ 802.4 $ 680.0
Noncurrent assets 559.9 532.8
Total $1,362.3 $1,212.8
Current liabilities $ 397.2 $ 345.1
Noncurrent liabilities 430.5 408.2
Shareholders' equity 534.6 459.5
Total $1,362.3 $1,212.8
</TABLE>
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
July 31, July 31,
1996 1995 1996 1995
<S> <C> <C> <C> <C>
Revenues $ 424.6 $ 355.8 $1,157.4 $ 947.8
Gross earnings $ 117.3 $ 95.6 $ 327.3 $ 255.5
Earnings from operations $ 50.5 $ 34.8 $ 141.7 $ 87.8
Other income (deductions) (2.3) (4.9) (13.9) (13.6)
Earnings before taxes
and minority interests 48.2 29.9 127.8 74.2
Income taxes (16.3) (9.9) (43.4) (24.5)
Minority interest (.3) .1 (.5) (.4)
Net earnings $ 31.6 $ 20.1 $ 83.9 $ 49.3
</TABLE>
The above information includes Baroid Corporation's oilfield services
operations which are reported in Drilling and Production operations and the
Sub Sea operations which are reported in Kellogg Oil and Gas Services.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS - THREE MONTHS AND NINE MONTHS ENDED JULY 31, 1996
COMPARED TO 1995
CONSOLIDATED OPERATIONS
Third quarter 1996 earnings per share increased 52% to $0.38 versus $0.25 in
the 1995 third quarter. Revenues of $1.6 billion were 14% higher and segment
operating profit of $153.2 million was 37% higher than in the 1995 third
quarter.
The quarterly improvement in operating results reflected sustained economic
growth in developed and developing countries driving demand for products
derived from oil and natural gas -- transportation fuels, petrochemicals,
fertilizers and power. July 31, 1996 consolidated backlog rose to an all-
time high of $4.5 billion, 25% higher than the level of a year ago.
Earnings per share for the nine months ended July 31, 1996 were $0.95 versus
$0.71 before the effect of an accounting change for post-employment benefits
in 1995, an increase of 34%. Revenues of $4.7 billion were 18% higher and
segment operating profit of $395.8 million was 31% higher than a year ago.
The nine-month increases in revenues and operating profit were lead by the
Drilling and Production Operations, the Bredero Shaw pipecoating business,
and the M. W. Kellogg operations. See the Industry Segment Analysis for a
more detailed discussion.
Selling, engineering, administrative and general expenses of $244.7 million
for the quarter and $724.8 million for the nine months were higher by 4% and
8%, respectively, than the prior year periods. The increases were primarily
due to the expenses of operations acquired in the latter part of 1995 and to
increased expenses associated with higher levels of business activity.
General Corporate Expenses (see Note A) of $20.5 million for the three months
and $61.2 million for the nine months were up 5% and 10%, respectively, from
the prior year periods. The increase for nine months was primarily due
to foreign exchange losses resulting from the devaluations of the Venezuelan
Bolivar in December 1995 and April 1996.
Net interest expense of $12.7 million in the quarter and $33.6 million in
the nine months was up 57% and 105%, respectively, from the 1995 periods.
A combination of increased interest expense on a higher level of short-term
debt and decreased interest income on a lower amount of investments caused
the net increases.
The estimated income tax rate for the nine months ended July 31, 1996 is 34%
compared to an estimated rate of 33% for the nine months ended July 31, 1995
and the final 1995 tax rate of 32%. The higher 1996 rate reflects lower
projected utilization of foreign tax credits in 1996 than in 1995.
INDUSTRY SEGMENT ANALYSIS
See Note A to Condensed Consolidated Financial Statements for details of
financial information by Industry Segment.
PETROLEUM PRODUCTS AND SERVICES SEGMENT
Drilling and Production Operations
Revenues rose 18% to $386.8 million for the quarter and 19% to $1,108.8
million for nine months. Operating profit increased 35% to $50.3 million
for the quarter and 44% to $145.7 million for nine months. These gains
reflect the higher volumes and firmer pricing related to an 8% improvement
in the worldwide rig count. A 16% increase in the offshore rig count has
created greater demand for synthetic drilling fluids, formation-evaluation-
while-drilling (FEWD) products and fixed-cutter drill bits. Activity levels
remained high in the major oil and gas producing regions, including the Gulf
of Mexico, North Sea, South America and West Africa. Operating margins
(return on sales) improved at the major operating units.
Kellogg Oil and Gas Services
Revenues for the quarter increased 63% to $167.3 million while operating
profit increased 79% to $11.1 million. For the nine months, revenues
increased 92% to $433.4 million and operating profit rose to $25.7 million
from $6.8 million last year. Bredero Shaw is benefiting from major
pipecoating activity in the Norwegian sector of the North Sea. Wellstream
continues to be profitable due to improved demand for its flexible pipe and
riser systems. At Sub Sea, strong results in the European market were more
than offset by intense competitive pressure and adverse weather conditions
in the Gulf of Mexico.
ENGINEERING SERVICES SEGMENT
M. W. Kellogg Operations
For the quarter, M. W. Kellogg revenues were $391.0 million. Operating
profit of $24.7 million increased 56%. Nine months revenues of $1,249.4
million were up 18% from 1995 and operating earnings of $65.6 million were
up 35%. Increasing activity on projects booked earlier this fiscal year
(including several LNG, fertilizer and ethylene projects) was offset by
lower revenues from projects that are nearing completion resulting in flat
revenues for the quarter. Higher earnings were due to lower proposal
costs in the current quarter and a prior-year loss at a Mexican affiliate.
Excluding the effect of that loss, earnings increased 25% in the current year
quarter. M. W. Kellogg's backlog at July 31, 1996 was $2.5 billion, 57%
higher than the $1.6 billion level a year ago.
ENERGY EQUIPMENT SEGMENT
Compression and Pumping
Revenues for the quarter improved 12% to $315.8 million and operating profit
increased 24% to $26.7 million. For the nine months, revenues of $856.2
million were up slightly from last year. Operating earnings of $56.0
million were up 25%. Revenues and profit improved at each operating unit --
Dresser-Rand, Ingersoll-Dresser Pump and Mono. At Dresser-Rand, a major
contract compression project is performing in excess of target, and demand
for Dresser-Rand Turbo Products continues at high levels. At the end of the
quarter,backlog for Dresser-Rand stood at $1.1 billion, somewhat higher
than the $1.0 billion level of a year ago.
Measurement
Revenues of $154.3 million and $456.1 million for the quarter and nine
months, respectively, were up slightly from last year. However, Operating
Profit declined 9% for the quarter and 30% for the nine months. The lower
earnings primarily resulted from adverse conditions in the Wayne retail
fueling systems business which is feeling the effects of pricing pressure
in key markets.
Flow Control
Revenues of $157.8 million for the quarter and $453.7 million for the nine
months represent increases of 26% and 41%, respectively, over the 1995
periods. Operating Profit of $17.8 million in the quarter and $46.6 million
in the nine month period was substantially higher than the prior year. Both
the Valve and Controls and Energy Valve Divisions generated significant
revenue and profit growth. The improvement at Valve and Controls reflected
volume growth associated with increased project activity in refining,
chemicals and power generation. The gains at Energy Valve reflected the
acquisition of Grove, completed in June 1995, as well as significant growth
in served markets.
Power Systems
Revenues increased 9% to $70.4 million for the quarter and 5% to $213.9
million for the nine months. Operating Profit increased 85% to $9.8 million
in the quarter, but was 10% under last year for the nine months. In the
quarter, Waukesha Engine Division gained from improving activity in gas
compression markets and a product mix that favored high horsepower engines
and packaged power generation products.
LIQUIDITY, CAPITAL RESOURCES AND FINANCIAL CONDITION
The Company's overall financial condition remained strong at July 31, 1996.
Since the beginning of the year, the Company used approximately $303.2
million more cash than the operations generated resulting in an increase in
short-term borrowings of $213.4 million. Major expenditures included $223.7
million for capital expenditures, $92.3 million for dividends, $191.4
million to repurchase shares and $29.5 million for business acquisitions.
In addition, $116.4 million of cash was used to finance working capital
primarily for increases in accounts receivable and inventories, and
decreases in payables and accrued expenses.
Total debt was $802.5 million as of July 31, 1996, compared to $590.9
million at October 31, 1995. Total debt was 35% of total book capitalization
as of July 31, 1996, compared to 26% as of October 31, 1995. Net debt was
12% of market capitalization at July 31, 1996, versus 8% at October 31, 1995.
LEGAL AND ENVIRONMENTAL MATTERS
The Company is currently involved in a number of lawsuits and has also been
identified as a potentially responsible party in a number of Superfund sites.
Note F to Condensed Consolidated Financial Statements includes significant
changes subsequent to October 31, 1995.
SUBSEQUENT EVENT
On August 9, 1996, the Company successfully completed the issuance of $300
million of 7.6% debentures (priced to yield 7.62%) due August 15, 2096.
The net proceeds of $295.7 million will be used for the repayment of
commercial paper and for general corporate purposes including the repurchase
of the Company's Common Stock.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
Exhibit 27 Financial Data Schedule
(b) A Report on Form 8-K dated August 6, 1996 was filed
for Item 7.
SIGNATURE
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.
DRESSER INDUSTRIES, INC.
By: /s/ George H. Juetten
George H. Juetten
Vice President - Controller
Dated: September 13, 1996
EXHIBIT INDEX
Exhibit Description
27 Financial Data Schedule. (Pursuant to Item 601(c)(iv) of
Regulation S-K, the Financial Data Schedule is not deemed
to be "filed" for purposes of Section 11 of the Securities
Act of 1933, as amended, or Section 18 of the Securities
Exchange Act of 1934, as amended.)
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> JUL-31-1996
<CASH> 158,900
<SECURITIES> 0
<RECEIVABLES> 1,063,600
<ALLOWANCES> 0
<INVENTORY> 907,700
<CURRENT-ASSETS> 2,511,600
<PP&E> 2,770,400
<DEPRECIATION> 1,558,500
<TOTAL-ASSETS> 5,119,700
<CURRENT-LIABILITIES> 2,226,700
<BONDS> 457,500
0
0
<COMMON> 46,200
<OTHER-SE> 1,465,200
<TOTAL-LIABILITY-AND-EQUITY> 5,119,700
<SALES> 4,710,300
<TOTAL-REVENUES> 4,730,500
<CGS> 3,690,700
<TOTAL-COSTS> 4,415,500
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 33,600
<INCOME-PRETAX> 277,500
<INCOME-TAX> 94,400
<INCOME-CONTINUING> 172,100
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 172,100
<EPS-PRIMARY> 0.95
<EPS-DILUTED> 0.95
</TABLE>
