FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1998
OR
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ________ to ___________
Commission file number: 000-15760
Hardinge Inc.
(Exact name of Registrant as specified in its charter)
New York 16-0470200
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Hardinge Inc.
One Hardinge Drive
Elmira, NY 14902
(Address of principal executive offices) (Zip code)
(607) 734-2281
(Registrant's telephone number including area code)
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 ____
As of June 30, 1998 there were 9,802,746 shares of Common Sock of the
Registrant outstanding.
<PAGE>
HARDINGE INC. AND SUBSIDIARIES
INDEX
Part I Financial Information Page
Item 1. Financial Statements
Consolidated Balance Sheets at June 30, 1998 and
December 31, 1997. 3
Consolidated Statements of Income and Retained
Earnings for the three months ended June 30, 1998
and 1997,and the six months ended June 30, 1998
and 1997. 5
Condensed Consolidated Statements of Cash Flows
for the six months ended June 30, 1998 and 1997. 6
Notes to Consolidated Financial Statements. 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations. 10
Item 3. Quantitative and Qualitative Disclosures About
Market Risks 13
Part I I Other Information
Item 1. Legal Proceedings 14
Item 2. Changes in Securities 14
Item 3. Default upon Senior Securities 14
Item 4. Submission of Matters to a Vote of Security Holders 14
Item 5. Other Information 14
Item 6. Exhibits and Reports on Form 8-K 14
Signatures 15
<PAGE>
PART I, ITEM 1
HARDINGE INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(In Thousands)
Jun. 30, Dec. 31,
1998 1997
-------------------------------
(Unaudited)
Assets
Current assets:
Cash $ 1,877 $ 1,565
Accounts receivable 55,542 56,210
Notes receivable 6,406 5,886
Inventories 93,908 91,969
Deferred income taxes 2,961 2,961
Prepaid expenses 2,431 1,790
-------------------------------
Total current assets 163,125 160,381
Property, plant and equipment:
Property, plant and equipment 138,284 128,640
Less accumulated depreciation 67,101 63,453
-------------------------------
71,183 65,187
Other assets:
Notes receivable 12,845 11,951
Deferred income taxes 837 837
Goodwill 4,010 4,082
Other 2,886 2,846
-------------------------------
20,578 19,716
-------------------------------
Total assets $254,886 $245,284
===============================
See accompanying notes.
<PAGE>
HARDINGE INC. AND SUBSIDIARIES
Consolidated Balance Sheets--Continued
(Dollars In Thousands)
Jun. 30, Dec. 31,
1998 1997
---------------------------
(Unaudited)
Liabilities and shareholders' equity
Current liabilities:
Accounts payable $ 12,706 $ 18,323
Notes payable to bank 6,167 7,282
Accrued expenses 12,191 9,756
Accrued income taxes 2,665 1,614
Deferred income taxes 1,774 1,553
Current portion long-term debt 4,355 3,468
---------------------------
Total current liabilities 39,858 41,996
Other liabilities:
Long-term debt 34,474 31,012
Accrued pension plan expense 2,311 2,311
Deferred income taxes 1,518 1,575
Accrued postretirement benefits 5,234 5,206
---------------------------
43,537 40,104
Shareholders' equity
Preferred stock, Series A, par value $.01:
Authorized - 3,000,000; issued - none
Common stock, $.01 par value:
Authorized shares - 20,000,000
Issued shares - 9,843,992 at June 30, 1998; 98
6,511,703 at December 31, 1997 65
Additional paid-in capital 59,964 58,065
Retained earnings 120,714 112,625
Treasury shares (983) (552)
Accumulated other comprehensive income:
Foreign currency translation adjustments (3,067) (2,763)
Deferred employee benefits (5,235) (4,256)
---------------------------
Total shareholders' equity 171,491 163,184
---------------------------
Total liabilities and shareholders' equity $254,886 $245,284
===========================
See accompanying notes.
<PAGE>
HARDINGE INC AND SUBSIDIARIES
Consolidated Statements of Income and Retained Earnings (Unaudited)
(In Thousands, Except Per Share Data)
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30,
1998 1997 1998 1997
------------------------------- ------------------------------
<S> <C> <C> <C> <C>
Net Sales $65,071 $63,668 $130,850 $123,724
Cost of sales 41,471 42,334 84,397 82,212
---------------------------------------------------------------------------------------- ------------------------------
Gross profit 23,600 21,334 46,453 41,512
Selling, general and
administrative expenses 14,532 12,975 28,203 24,779
Unusual expense 1,960
---------------------------------------------------------------------------------------- ------------------------------
Income from operations 9,068 8,359 18,250 14,773
Interest expense 598 674 1,171 1,365
Interest (income) (109) (188) (259) (354)
---------------------------------------------------------------------------------------- ------------------------------
Income before income taxes 8,579 7,873 17,338 13,762
Income taxes 3,170 3,040 6,475 5,415
---------------------------------------------------------------------------------------- ------------------------------
Net income 5,409 4,833 10,863 8,347
Retained earnings at beginning of period 116,711 101,901 112,625 99,622
Less dividends declared 1,373 1,236 2,741 2,471
Less transfer to common stock due to
stock split in the form of a dividend 33 33
---------------------------------------------------------------------------------------- ------------------------------
Retained earnings at end of period $120,714 $105,498 $120,714 $ 105,498
======================================================================================== ==============================
Per share data:
Basic earnings per share $ .57 $ .52 $ 1.15 $ .90
======================================================================================== ==============================
Weighted average number
of common shares outstanding 9,420 9,347 9,417 9,323
======================================================================================== ==============================
Diluted earnings per share $ .57 $ .52 $ 1.15 $ .89
======================================================================================== ==============================
Weighted average number
of common shares outstanding 9,468 9,356 9,451 9,366
======================================================================================== ==============================
Cash dividends declared $ .14 $ .13 $ .28 $ .26
======================================================================================== ==============================
</TABLE>
1997 per share data restated for stock slpit - see Note D
See accompanying notes.
<PAGE>
HARDINGE INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In Thousands)
Six Months Ended
June 30,
1998 1997
----------------------------
Net cash provided by operating activities $10,334 $ 18,308
Investing activities:
Capital expenditures (10,320) (5,124)
Investment in subsidiary (4,588)
----------------------------
Net cash (used in) investing activities (10,320) (9,712)
Financing activities:
(Decrease) in short-term notes payable to bank (1,013) (6,801)
Increase (decrease) in long-term debt 4,497 (652)
(Purchase) sale of treasury stock (430) 137
Dividends paid (2,741) (2,471)
----------------------------
Net cash provided by (used in) financing activities 313 (9,787)
Effect of exchange rate changes on cash (15) (53)
-----------------------------
Net increase (decrease) in cash $ 312 ($1,244)
=============================
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
June 30, 1998
NOTE A--BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and Article
10 of Regulation S-X. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the three and six month periods ended June
30, 1998, are not necessarily indicative of the results that may be expected for
the year ended December 31, 1998. For further information, refer to the
consolidated financial statements and footnotes thereto included in the
Company's annual report for the year ended December 31, 1997.
The Company has adopted Statement of Financial Accounting Standards
No. 131, "Disclosures About Segments of an Enterprise and Related Information."
The Company operates in only one business segment - industrial machine tools.
NOTE B--INVENTORIES
Inventories are summarized as follows (dollars in thousands):
June 30, December 31,
1998 1997
------------------------------------
Finished products $ 35,871 $ 32,290
Work-in-process 31,800 32,328
Raw materials and purchased components 26,237 27,351
--------------- ---------------
$ 93,908 $ 91,969
=============== ===============
NOTE C--UNUSUAL EXPENSE
1997's first quarter included a one-time charge of $1,960,000
(approximately $1,200,000 after tax, or $.13 per share). This non-recurring
charge involves outside costs incurred in connection with a major acquisition
that the Company carried into the final stages of the due diligence process but
decided not to complete.
NOTE D--CHANGES IN SHAREHOLDERS' EQUITY
On April 28, 1998, the Board of Directors approved a three-for-two
stock split of the Company's Common shares to be paid in the form of a 50
percent stock dividend. As a result of the split, 3,281,351 additional shares
were issued on May 29, 1998 to shareholders of record on May 8, 1998 and
retained earnings were reduced by $32,813. Any fractional shares resulting from
the split were paid in cash. All references in the accompanying consolidated
financial statements to common shares outstanding and earnings per share have
been restated to reflect this stock split.
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
June 30, 1998
NOTE E--EARNINGS PER SHARE AND WEIGHTED AVERAGE SHARES OUTSTANDING
Earnings per share are computed using the weighted average number of
shares of common stock outstanding during the period. For diluted earnings per
share, the weighted average number of shares includes common stock equivalents
related primarily to restricted stock. In 1997, Statement of Financial
Accounting Standards No. 128 "Earnings per Share" was issued. Statement 128
replaced the calculation of primary and fully diluted earnings per share with
basic and diluted earnings per share. All earnings per share amounts have been
restated to conform to the requirements of Statement 128. All earnings per share
amounts and shares outstanding have been restated to reflect the stock split
mentioned above.
The following is a reconciliation of the numerators and denominators
of the basic and diluted earnings per share computations required by Statement
No. 128. The table sets forth the computation of basic and diluted earnings per
share:
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30,
-----------------------------------------------------------
1998 1997 1998 1997
-----------------------------------------------------------
(in thousands)
<S> <C> <C> <C> <C>
Numerator:
Net income $ 5,409 $ 4,833 $10,863 $ 8,347
Numerator for basic earnings per share 5,409 4,833 10,863 8,347
Numerator for diluted earnings per share 5,409 4,833 10,863 8,347
Denominator:
Denominator for basic earnings per share
-weighted average shares 9,420 9,347 9,417 9,323
Effect of diluted securities:
Restricted stock and stock options 48 9 34 43
Denominator for diluted earnings per share
-adjusted weighted average shares 9,468 9,356 9,451 9,366
Basic earnings per share $ .57 $ .52 $ 1.15 $ .90
=========================== ===========================
Diluted earnings per share $ .57 $ .52 $ 1.15 $ .89
=========================== ===========================
</TABLE>
NOTE F--DIVIDENDS DECLARED
Dividends declared per share have been restated to reflect the
additional shares issued in the stock split mentioned above.
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
June 30, 1998
NOTE G--REPORTING COMPREHENSIVE INCOME
As of January 1, 1998 the Company adopted Statement of Financial
Accounting Standards No. 130, "Reporting Comprehensive Income." Statement 130
establishes new rules for the reporting and display of comprehensive income and
its components. However, the adoption of this Statement had no impact on the
Company's net income or shareholders' equity. Statement 130 requires that
foreign currency translation adjustments, which prior to adoption were reported
separately in shareholders' equity, be included in shareholders' equity as other
comprehensive income. Prior year financial statements were reclassified to
conform to the requirements of Statement 130.
During the three months and six months ended June 30, 1998 and 1997,
the components of total comprehensive income consisted of the following (dollars
in thousands):
Three months ended Six months ended
June 30, June 30,
1998 1997 1998 1997
---------- ---------- ----------- ---------
Net Income $ 5,409 $ 4,833 $ 10,863 $ 8,347
Foreign currency
translation adjustments (38) (76) (304) (1,784)
========== ========== =========== =========
Comprehensive Income $ 5,371 $ 4,757 $ 10,559 $ 6,563
========== ========== =========== =========
<PAGE>
PART I, ITEM 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
The following are management's comments relating to significant changes
in the results of operations for the three month and six month periods ended
June 30, 1998 and 1997 and in the Company's financial condition during the six
month period ended June 30, 1998.
Results of Operations
Net Sales. Net sales for the quarter ended June 30, 1998 were
$65,071,000, an increase of 2.2% over 1997's second quarter sales of
$63,668,000. Year to date sales of $130,850,000 for the first six months of 1998
represent a 5.8% increase over the $123,724,000 net sales for the same 1997
period.
Geographically, second quarter U.S. sales of $45,804,000 exceeded
1997's second quarter by $1,154,000, or 2.6%. Similarly, U.S. sales for the
first six months of 1998 were up by $2,713,000 over the previous year, an
increase of 3.1%. Sales to European customers increased by $1,379,000, or 11.4%,
during the second quarter of 1998 compared to 1997, continuing the trend
reported during the first quarter of 1998. Year to date June 30, 1998 European
sales increased by $6,318,000 or 28.5% over the previous year. Sales to Asia and
all other parts of the world declined by $1,130,000 and $1,905,000 for the three
and six months ended June 30, 1998 compared to similar periods during 1997.
Machine sales accounted for $45,162,000 of net sales for the second
quarter of 1998, compared to $43,103,000 for the same 1997 period. Year to date
June 30, 1998 sales of machines accounted for $91,567,000, a 7.8% increase over
the $84,962,000 sales in the same 1997 period. Sales of non-machine products and
services in the second quarter of 1998 were slightly less than a year ago, at
$19,909,000 compared to $20,565,000. Year to date sales of this product group
were $39,283,000, up 1.3% from $38,762,000 the previous year.
Gross Profit. Gross margin for the second quarter of 1998, as a
percentage of sales, improved significantly to 36.3% from 33.5% a year earlier.
Gross margin for the six month periods ended June 30 showed a similar increase,
from 33.6% in 1997 to 35.5% in 1998. The improvement was largely due to
increased utilization of the Company's factories in the United States and
Switzerland and better product mix.
Selling, General, and Administrative Expenses. Selling, general and
administrative ("SG&A") expenses were 22.3% of sales during the second quarter
of 1998 compared to 20.4% a year earlier. SG&A expenses for the six months ended
June 30, 1998 and 1997 were 21.6% and 20.0%, respectively. The increase
represents implementation of the Company's strategy to hire additional sales and
service personnel to better serve its growing customer base. Also, the cost of
machine tool shows and promotion costs have increased during 1998, reflecting
the Company's major commitment to the International Manufacturing Technology
Show, to be held in Chicago during September. The show is held every two years.
<PAGE>
Income from Operations. Income from operations as a percentage of net
sales increased for the three months ended June 30, 1998 to 13.9%, from 13.1% a
year earlier, as the increase in gross margin for the period was only partially
offset by higher SG&A costs. Income from operations for the first six months of
1998 increased to 13.9% of sales compared to 11.9% for the same period of 1997.
Income from operations for the first six months of 1997 included a one-time
charge of $1,960,000 for costs incurred in connection with a major acquisition
which the Company decided not to complete. Net income from operations as a
percentage of net sales, without consideration of this charge, would have been
13.5% for the first six months of 1997.
Interest Expense. Interest expense for the quarter ended June 30, 1998
was somewhat lower than a year earlier, at $598,000 compared to $674,000 during
the second quarter of 1997. Interest expense for the six month periods ended
June 30, 1998 and 1997 was $1,171,000 and $1,365,000, respectively. While
average borrowings have remained relatively unchanged during both years, the
average interest rate paid during 1998 was slightly lower.
Interest Income. Interest income was somewhat lower ($79,000 and
$95,000, respectively) for the three and six month periods ended June 30, 1998
compared to the same 1997 periods because the Company chose to offer lower
interest rates as a sales incentive to its customers to a greater extent during
1998.
Income Taxes. The provision for income taxes as a percentage of income
before income taxes was 37.0% for the three months ended June 30, 1998, compared
to 38.6% a year previous. The tax rates for the six month periods ended June 30,
1998 and 1997 were 37.3% and 39.3%, respectively. The lower effective tax rates
during 1998 result from higher utilization of U.S. income tax credits.
Net Income. Net income for the second quarter of 1998 was $5,409,000,
or $.57 per share, an increase of $576,000 or 11.9% from the same 1997 period.
Year to date 1998 net income was $10,863,000, or $1.15 per share, compared to
$8,347,000, or $.89 per share for the same 1997 period (after restatement for
the Company's May, 1998 3-for-2 stock split). 1997's net income was reduced by
$1,200,000, or $.13 per share (after restatement), as a result of the previously
reported non-recurring charge related to first quarter 1997 acquisition efforts.
Excluding that charge, net income for the first half of 1997 was $9,547,000, or
$1.02 per share restated for the stock split. The improvement in performance is
primarily the result of increased volume coupled with successful margin and
operating cost management.
Earnings Per Share. All earnings per share and weighted average share
amounts are presented, and where appropriate, restated as diluted to conform
with Financial Accounting Standards Board Statement No. 128, Earnings Per Share.
Additionally, to provide comparability between periods, prior periods' data have
also been restated to give effect to the Company's 3-for-2 stock split which
took place in May, 1998.
<PAGE>
Quarterly Information
The following table sets forth certain quarterly financial data for
each of the periods indicated.
Three Months Ended
Mar. 31, June 30, Sept. 30, Dec. 31,
1997 1997 1997 1997
---------------------------------------------
(in thousands, except per share data)
----------------------------------------------
Net Sales $ 60,056 $ 63,668 $ 56,772 $66,083
Gross Profit 20,178 21,334 19,193 21,713
Income from operations 6,414 8,359 6,800 8,926
Net income 3,514 4,833 3,985 5,608
Diluted earnings per share .38 .52 .42 .59
Weighted average shares
outstanding 9,328 9,356 9,413 9,443
Three Months Ended
Mar. 31, June 30,
1998 1998
----------------------------------------------
(in thousands, except per share data)
----------------------------------------------
Net Sales $ 65,779 $ 65,071
Gross Profit 22,853 23,600
Income from operations 9,182 9,068
Net income 5,454 5,409
Diluted earnings per share .58 .57
Weighted average shares
outstanding 9,441 9,468
Liquidity and Capital Resources
Hardinge's current ratio at June 30, 1998 was 4.09:1 compared to 3.82:1
at December 31, 1997. Current assets increased by $2,744,000, primarily as a
result of an increase in inventory of $1,939,000. Current liabilities decreased
by $2,138,000, with a reduction of accounts payable of $5,617,000 being
partially offset by a number of smaller increases in other current liabilities.
In the first half of 1998, operating activities provided $10,334,000 of
cash, compared to $18,308,000 for the first half of 1997 during which
inventories were reduced to normal levels after several major projects were
completed. Capital expenditures and cash used in acquisition activities during
both six month periods remained relatively constant, at $10,320,000 in 1998 and
$9,712,000 in 1997. Excess cash generated during the first half of 1997 was used
to reduce debt by $7,453,000, while debt was increased by $3,484,000 during the
first half of 1998.
Hardinge provides long-term financing for the purchase of its equipment
by qualified customers. We periodically sell portfolios of our customer notes to
financial institutions in order to reduce debt and finance current operations.
Our customer financing program has an impact on our month-to-month borrowings,
but it has had little long-term impact on our working capital because of the
ability to sell the underlying notes. We sold $19,476,000 of customer notes in
the first half of 1998, compared to $17,400,000 during the same period of 1997.
<PAGE>
At June 30, 1998 Hardinge maintained revolving loan agreements with
several U.S. banks providing for unsecured borrowing up to $70,000,000 on a
revolving basis, $20,000,000 through November 1, 1999 and $50,000,000 through
August 1, 2002. At November 1, 1999 any outstanding balance on the $20,000,000
facility converts, at the Company's option, to a term loan payable quarterly
over four years through 2003 These facilities, along with other short term
credit agreements, provide for immediate access of up to $77,000,000. At June
30, 1998, outstanding borrowings under these arrangements totaled $24,900,000.
We believe that the currently available funds and credit facilities,
along with internally generated funds, will provide sufficient financial
resources for ongoing operations.
The Company continues implementation of its program to assure that the
year 2000 problem will have no significant impact on operations. The plan, which
considers both internal and external vulnerability, will be completed in
sufficient time to avoid any disruption of its operations. The cost of
implementing the plan is not material.
This report contains statements of a forward-looking nature relating to
the financial performance of Hardinge Inc. Such statements are based upon
information known to management at this time. The company cautions that such
statements necessarily involve uncertainties and risk and deal with matters
beyond the company's ability to control, and in many cases the company cannot
predict what factors would cause actual results to differ materially from those
indicated. Among the many factors that could cause actual results to differ from
those set forth in the forward-looking statements are fluctuations in the
machine tool business cycles, changes in general economic conditions in the U.S.
or internationally, the mix of products sold and the profit margins thereon, the
relative success of the company's entry into new product and geographic markets
, the company's ability to manage its operating costs, actions taken by
customers such as order cancellations or reduced bookings by customers or
distributors, competitors' actions such as price discounting or new product
introductions, governmental regulations and environmental matters, changes in
the availability and cost of materials and supplies, the implementation of new
technologies and currency fluctuations. Any forward-looking statement should be
considered in light of these factors. The company undertakes no obligation to
revise its forward-looking statements if unanticipated events alter their
accuracy.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not Applicable
<PAGE>
Part II. OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Default upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
The 1998 Annual Meeting of Shareholders of Hardinge Inc. was held
on April 28, 1998. A total of 6,214,259 of the Company's shares were present or
represented by proxy at the meeting. This represents more than 95% of the
Company's shares outstanding.
The three Class I directors named below were elected to serve a
three-year term and the Class II director named below was elected to serve a
one-year term.
Votes for Votes Withheld
Class I Directors
Robert E. Agan 6,207,125 7,134
Richard J. Cole 6,207,755 6,504
E. Martin Gibson 6,205,011 9,248
Class II Director
Albert W. Moore 6,205,271 8,988
John W. Bennett, James L. Flynn, Douglas A. Greenlee, J. Philip
Hunter and Eve L. Menger continue as Directors of the Company. Since said date,
Eve L. Menger has resigned from the Board of Directors effective August 1,
1998 and Daniel J. Burke has been elected to fill the vacancy created.
The election of Ernst & Young LLP as the Company's independent
accountants was ratified, with 6,198,745 shares voting for and 4,565 shares
voting against.
No other matters were presented for vote at that meeting.
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
A. Exhibits
27.1 Financial Data Schedule
27.2 Restated Financial Data Schedule
B. Reports on Form 8-K
Current report on Form 8-K, dated May 11, 1998 was filed in
connection with an April 28, 1998 press release announcing a three-for-two stock
split.
<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.
Hardinge Inc.
August 12, 1998 By:_/s/ Robert E. Agan____________________
Date Robert E. Agan
Chairman of the Board, President /CEO
August 12, 1998 By:_/s/ J. Patrick Ervin___________________
Date J. Patrick Ervin
Executive Vice President
August 12, 1998 By:_/s/ Malcolm L Gibson___________________
Date Malcolm L. Gibson
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
August 12, 1998 By:_/s/ Richard L. Simons__________________
Richard L. Simons
Vice President - Finance
(Principal Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS INFORMATION EXTRACTED FROM THE COMPANY'S UNAUDITED
FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> 1,877
<SECURITIES> 0
<RECEIVABLES> 74,793
<ALLOWANCES> 0
<INVENTORY> 93,908
<CURRENT-ASSETS> 163,125
<PP&E> 138,284
<DEPRECIATION> 67,101
<TOTAL-ASSETS> 254,886
<CURRENT-LIABILITIES> 39,858
<BONDS> 0
0
0
<COMMON> 98
<OTHER-SE> 171,393
<TOTAL-LIABILITY-AND-EQUITY> 254,886
<SALES> 130,850
<TOTAL-REVENUES> 130,850
<CGS> 84,397
<TOTAL-COSTS> 28,203
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,171
<INCOME-PRETAX> 17,338
<INCOME-TAX> 6,475
<INCOME-CONTINUING> 10,863
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 10,863
<EPS-PRIMARY> 1.15
<EPS-DILUTED> 1.15
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS RESTATED SCHEDULE CONTAINS INFORMATION EXTRACTED FROM THE COMPANY'S
UNAUDITED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. EARNINGS
PER SHARE AMOUNTS HAVE BEEN RESTATED TO REFLECT A THREE FOR TWO STOCK SPLIT IN
MAY 1998.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 1,392
<SECURITIES> 0
<RECEIVABLES> 65,357
<ALLOWANCES> 0
<INVENTORY> 90,794
<CURRENT-ASSETS> 150,101
<PP&E> 125,580
<DEPRECIATION> 60,153
<TOTAL-ASSETS> 231,423
<CURRENT-LIABILITIES> 30,680
<BONDS> 0
0
0
<COMMON> 65
<OTHER-SE> 152,486
<TOTAL-LIABILITY-AND-EQUITY> 231,423
<SALES> 123,724
<TOTAL-REVENUES> 123,724
<CGS> 82,212
<TOTAL-COSTS> 24,779
<OTHER-EXPENSES> 1,960
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,365
<INCOME-PRETAX> 13,762
<INCOME-TAX> 5,415
<INCOME-CONTINUING> 8,347
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,347
<EPS-PRIMARY> .90
<EPS-DILUTED> .89
</TABLE>
