<PAGE> 1
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 September 30, 1998 Commission File number 1-5341
------------------ ------
ELCOR CORPORATION
------------------------------------------------------
(Exact name of Registrant as specified in its charter)
DELAWARE 75-1217920
- ------------------------------- ------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
14643 DALLAS PARKWAY
SUITE 1000, WELLINGTON CENTRE, DALLAS, TEXAS 75240-8871
- -------------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (972) 851-0500
--------------
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 close of business on November 2, 1998, Registrant had outstanding
12,982,214 shares of Common Stock, Par Value $1 per Share.
<PAGE> 2
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
ELCOR CORPORATION
CONSOLIDATED BALANCE SHEET
(Unaudited, $ in thousands)
<TABLE>
<CAPTION>
ASSETS 9-30-98 6-30-98
- ------ --------- ---------
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 3,210 $ 5,240
Trade receivables, less allowance of $793 and $580 65,567 56,450
Inventories -
Finished goods 15,038 20,549
Work-in-process 432 446
Raw materials 7,001 7,827
--------- ---------
Total inventories 22,471 28,822
--------- ---------
Prepaid expenses and other 1,361 1,789
Deferred income taxes 2,153 2,228
--------- ---------
Total current assets 94,762 94,529
--------- ---------
PROPERTY, PLANT AND EQUIPMENT, AT COST 187,110 194,133
Less - accumulated depreciation (70,244) (73,401)
--------- ---------
Property, plant and equipment, net 116,866 120,732
--------- ---------
OTHER ASSETS 1,909 1,783
--------- ---------
$ 213,537 $ 217,044
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
CURRENT LIABILITIES
Accounts payable $ 15,518 $ 14,579
Accrued liabilities 16,796 12,628
--------- ---------
Total current liabilities 32,314 27,207
--------- ---------
LONG-TERM DEBT 43,300 48,000
DEFERRED INCOME TAXES 14,044 15,881
SHAREHOLDERS' EQUITY -
Common stock 13,326 13,326
Paid-in-capital 66,979 67,862
Retained earnings 49,671 47,394
--------- ---------
129,976 128,582
Less - Treasury stock (260,823 and 100,423 shares, at cost) (6,097) (2,626)
--------- ---------
Total shareholders' equity 123,879 125,956
--------- ---------
$ 213,537 $ 217,044
========= =========
</TABLE>
See accompanying notes to consolidated financial statements.
2
<PAGE> 3
ELCOR CORPORATION
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited, $ in thousands
except per share data)
<TABLE>
<CAPTION>
Three Months Ended
----------------------
9-30-98 9-30-97
-------- --------
<S> <C> <C>
SALES $ 85,868 $ 73,516
-------- --------
COST AND EXPENSES
Cost of sales 63,063 55,401
Selling, general and administrative 10,272 8,805
-------- --------
INCOME FROM OPERATIONS 12,533 9,310
-------- --------
OTHER EXPENSE
Interest expense, net 559 759
-------- --------
INCOME BEFORE INCOME TAXES 11,974 8,551
Provision for income taxes 4,448 3,157
-------- --------
INCOME BEFORE CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING PRINCIPLE 7,526 5,394
CUMULATIVE EFFECT OF CHANGE IN
ACCOUNTING PRINCIPLE (4,340) 0
-------- --------
NET INCOME $ 3,186 $ 5,394
======== ========
INCOME PER COMMON SHARE-BASIC:
Before cumulative effect of change in accounting principle $ .57 $ .41
Cumulative effect of change in
accounting principle (.33) --
-------- --------
NET INCOME PER SHARE-BASIC $ .24 $ .41
======== ========
INCOME PER COMMON SHARE-DILUTED:
Before cumulative effect of change in accounting principle $ .56 $ .40
Cumulative effect of change in
accounting principle (.32) --
-------- --------
NET INCOME PER SHARE-DILUTED $ .24 $ .40
======== ========
DIVIDENDS PER COMMON SHARE $ .07 $ .06
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE> 4
ELCOR CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited, $ in thousands)
<TABLE>
<CAPTION>
Three Months Ended
------------------
9-30-98 9-30-97
------- -------
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C>
Net income $ 3,186 $ 5,394
Adjustments to reconcile net income
to net cash from operating activities:
Depreciation and amortization 2,230 2,683
Deferred income taxes 580 773
Cumulative effect of change in accounting principle 4,340 --
Changes in assets and liabilities:
Trade receivables (9,117) (7,648)
Inventories 6,351 5,518
Prepaid expenses and other 428 2,117
Accounts payable and accrued liabilities 5,107 398
-------- --------
Net cash provided by operating activities 13,105 9,235
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property, plant and equipment (5,037) (1,791)
Other (134) (29)
-------- --------
Net cash used for investing activities (5,171) (1,820)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Long-term borrowings, net (4,700) (7,100)
Dividends on common stock (909) (794)
Treasury stock transactions and other, net (4,355) 120
-------- --------
Net cash used for financing activities (9,964) (7,774)
-------- --------
NET DECREASE IN CASH AND CASH EQUIVALENTS (2,030) (359)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 5,240 3,601
-------- --------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 3,210 $ 3,242
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
4
<PAGE> 5
ELCOR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. The attached condensed consolidated financial statements have been
prepared pursuant to the rules and regulations of the Securities and
Exchange Commission. As a result, certain information and footnote
disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been
condensed or omitted. The company believes that the disclosures
included herein are adequate to make the information presented not
misleading. These condensed consolidated financial statements should be
read in conjunction with the consolidated financial statements and
related notes included in the company's 1998 Annual Report on Form
10-K. The unaudited financial information contained herein has been
prepared in conformity with generally accepted accounting principles on
a consistent basis and does reflect all adjustments which are, in the
opinion of management, necessary for a fair presentation of the results
of operations for the three-month periods ending September 30, 1998 and
1997, but are, however, subject to year-end audit by the company's
independent auditors. Because of seasonal, weather-related conditions
in some of the company's market areas, sales can vary at times, and
results of any one quarter or other interim reporting period should not
necessarily be considered as indicative of results for a full fiscal
year.
2. In fiscal 1998, the company changed its method of accounting for
inventories from the LIFO method to the FIFO method. In accordance with
Accounting Principles Board Opinion No. 20, "Accounting Changes," the
consolidated financial statements as of September 30, 1997 have been
restated to reflect this accounting change. There was no significant
impact on net income for the three months ended September 30, 1997 as a
result of this change in accounting principle.
3. In September 1997, the Board of Directors declared a three-for-two
stock split payable in the form of a stock dividend, which was
distributed on November 12, 1997. Appropriate references to number of
shares and to per share information in the consolidated financial
statements as of September 30, 1997 have been adjusted to reflect the
stock split on a retroactive basis.
4. On September 15, 1998, the company experienced an explosion at its
fiberglass roofing mat plant in Ennis, Texas. The explosion
significantly damaged a drying oven and caused less extensive damage to
the remainder of the mat line. At the time of the explosion, the
damaged mat line supplied all of the company's internal fiberglass
roofing mat needs. In addition, roofing mats from the damaged line were
being sold to other asphalt roofing products manufacturers. There was
no damage to a separate mat line that runs in parallel to the damaged
line, nor was there any damage to the company's Ennis, Texas shingle
manufacturing plant. There were no injuries from the explosion.
5
<PAGE> 6
The company has increased roofing mat production from its nondamaged
mat line and has begun purchasing additional roofing mats from third
party suppliers. The company believes there are adequate supplies of
roofing mats from internal and/or external sources available to operate
its three roofing shingle manufacturing facilities until the damaged
line is repaired and fully operational. The company anticipates that
the damaged line should be restored to partial service by this winter
and be fully restored by the spring of 1999.
The company carries both property damage and business interruption
insurance. Accordingly, management does not expect the explosion to
have a material adverse impact on the company's financial results. The
$100,000 deductible portion of the loss was recorded during the quarter
ended September 30, 1998.
5. In the first quarter of fiscal 1999, the company adopted Statement of
Position 98-5, "Reporting on the Costs of Start-Up Activities," issued
by the Accounting Standards Executive Committee of the American
Institute of Certified Public Accountants. This Statement of Position
requires, among other things, companies to expense on a current basis
previously capitalized start-up costs. Adoption of this Statement of
Position resulted in a $4,340,000 charge, net of tax, and is reported
as a cumulative effect of change in accounting principle on the
Consolidated Statement of Operations.
6. During the first quarter of fiscal 1999, the company adopted Statement
of Financial Accounting Standards No. 130 (SFAS 130), "Reporting
Comprehensive Income." The adoption of SFAS 130 had no effect on the
consolidated financial statements, as there are no items that the
company is required to recognize as components of comprehensive income.
7. In June 1997, the Financial Accounting Standards Board issued SFAS No.
131, "Disclosure about Segments of an Enterprise and Related
Information." SFAS No. 131 requires publicly held companies to
disclose, among other things, certain interim and annual financial
information about the enterprise using a new management approach. This
approach requires segment information to be reported based on how
management evaluates the operating performance of its business units or
segments. The company will adopt SFAS No. 131 in fiscal 1999, but is
still assessing the disclosure requirements of this standard.
6
<PAGE> 7
8. Basic earnings per share is computed based on the average number of
common shares outstanding. Diluted earnings per share includes
outstanding stock options.
The following table sets forth the computation of basic and diluted
earnings per share:
<TABLE>
<CAPTION>
Three Months Ended
9-30-98 9-30-97
------- -------
<S> <C> <C>
Net Income $ 3,186 $ 5,394
======= =======
Denominator for basic earnings
per share - weighted average 13,127 13,202
shares outstanding
Effect of dilutive securities:
Employee stock options 206 242
------- -------
Denominator for dilutive earnings
per share - adjusted weighted
average shares and assumed
issuance of shares purchased
under incentive stock option plan
using the treasury stock method 13,333 13,444
======= =======
Basic earnings per share $ .24 $ .41
======= =======
Diluted earnings per share $ .24 $ .40
======= =======
</TABLE>
7
<PAGE> 8
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
RESULTS OF OPERATIONS
During the three months ended September 30, 1998, net income before the
cumulative effect of a change in accounting principle increased 40% to
$7,526,000 from $5,394,000 in last year's first quarter. Sales increased 17%
compared to the prior year first quarter. The increases in sales and net income
before the accounting change were primarily the result of increased production
and a record level of shipments of the company's patented Enhanced High
Definition(R) and Raised Profile(TM) Prestique(R) premium laminated fiberglass
asphalt shingles and rapidly accelerating demand for Chromium's Conductive
Coatings Division products used in digital wireless cellular phones. In the
first quarter of fiscal 1999, the company adopted Statement of Position 98-5,
"Reporting on the Costs of Start-Up Activities," issued by the Accounting
Standards Executive Committee of the American Institute of Certified Public
Accountants, which resulted in a $4,340,000 charge, net of tax, for the
cumulative effect of this accounting change. This one-time cumulative charge
reduced net income for the first quarter of fiscal 1999 to $3,186,000 from
$5,394,000, in the same quarter last year.
The Roofing Products Group achieved significantly higher sales with sharply
increased operating profit for the three months ended September 30, 1998
compared to the same prior year period. These increases were primarily the
result of increased manufacturing output and a record level of shipments of
premium laminated fiberglass asphalt shingles. Demand was strong in most
regions of the United States. As a result, each of the company's roofing plants
achieved higher production levels, sales and operating profit in the first
quarter of fiscal 1999 than in the same prior year quarter. The company's
nonwoven fiberglass roofing mat plant also contributed to improved first
quarter results. However, as described in note 4 of this Form 10-Q, this plant
was damaged by an explosion on September 15, 1998. Due to the company's
property damage and business interruption insurance policies, management does
not expect the explosion to have a material adverse impact on the company's
financial results.
The Industrial Products Group recorded both lower sales and lower operating
profit for the first three months of fiscal 1999 compared to the same prior
year period due to lower revenues and income from Ortloff Engineers' technology
licensing and consulting services for the natural gas processing industry.
Lower oil prices have reduced capital spending plans for some of its customers.
Chromium Corporation reported strong growth in sales and operating income,
primarily as a result of accelerating demand for its Compushield conductive
coatings and conductive gaskets used in wireless digital telecommunications and
other electronic equipment industries. Chromium's sales of remanufactured large
diesel engine components also increased in the first quarter of fiscal 1999
compared to the prior year quarter.
On an overall basis, gross margin on sales was 26.6% for the quarter ended
September 30, 1998 compared to 24.6% in the prior year quarter. The improvement
in margin was primarily attributable to increased production, which lowered per
unit costs, at the company's roofing shingle plants. Selling, general and
administrative costs were 12.0% of sales in both the current year quarter and
in the prior year quarter.
At the present time, the company anticipates continued growing demand for its
premium laminated fiberglass asphalt shingles in fiscal 1999, although the
market is seasonally slower in the December and
8
<PAGE> 9
March quarters. Further, the third expansion of its Conductive Coatings facility
is expected to be completed in the second quarter of fiscal 1999. The company
expects the added capacity will be used for increased production of wireless
digital cellular phone components to meet rapidly growing demand for these
products.
FINANCIAL CONDITION
During the first three months of fiscal 1999, the company generated cash flows
of $13,105,000 from operating activities. Of this total, $4,874,000 was the
result of a decrease in working capital. The decrease in working capital was
primarily due to lower cash balances, increased current liabilities and lower
inventories, offset by increased trade receivables. Each of these changes were
primarily the result of increased business activities and higher sales during
the quarter ended September 30, 1998. The current ratio at September 30, 1998
was 2.9:1 compared to 3.5:1 at June 30, 1998. Historically, working capital
requirements fluctuate during the year because of seasonality in some market
areas. Generally, working capital requirements and related borrowings are higher
in the spring and summer months, and lower in the fall and winter months.
The company used $5,171,000 for investing activities in the first three months
of fiscal 1999. The majority of investing expenditures were for additions to
property, plant and equipment. Capital expenditures are expected to be about
$24,000,000 in fiscal 1999 excluding replacement of equipment at the Ennis,
Texas mat plant damaged by an explosion as described in note 4 of this Form
10-Q. The expenditures incurred to replace damaged equipment are expected to be
covered by the company's property damage insurance policy. The majority of
currently planned fiscal 1999 capital expenditures are a continuation of
productivity, capacity and cost improvement projects at its existing roofing
plants, continued capacity expansion of the Conductive Coatings operation, and
capital costs associated with developing new computer systems. The company
expects to invest about $100 million over the next three years to expand
capacity and improve productivity at existing plants and to build new plants in
both the Roofing Products and Industrial Products segments.
Cash flows used for financing activities were $9,964,000 during the first three
months of fiscal 1999, primarily resulting from dividend payments, a $4,700,000
decrease in long-term debt, and purchases of treasury shares. Long-term debt
represented 26% of the $167,179,000 of invested capital (long-term debt plus
shareholders' equity) at September 30, 1998. At September 30, 1998, $54,910,000
was available under the company's $100,000,000 revolving line of credit.
During the first quarter of fiscal 1999, the company purchased 201,200 shares of
its common shares on the open market under SEC Rule 10b-18 at a total cost of
$4,561,000 to complete the $10 million stock buy back program authorized by the
Board of Directors in September 1994. On September 28, 1998, the Board of
Directors authorized an additional $10 million stock repurchase program. The
Board of Directors also increased the regular quarterly cash dividend rate by
17% to $.07 per share effective with the dividend payable November 10, 1998.
The company's operations are subject to extensive federal, state and local laws
and regulations relating to environmental matters. Although the company does not
believe it will be required to expend amounts which will have a material adverse
effect on the company's consolidated financial position or results of operations
by reason of environmental laws and regulations, such laws and regulations are
frequently changed and could result in significantly increased cost of
compliance.
9
<PAGE> 10
Further, certain of the company's industrial products operations utilize
hazardous materials in their production process. As a result, the company incurs
costs for remediation activities off-site and at its facilities from time to
time. The company establishes and maintains reserves for such remediation
activities, when appropriate, in accordance with Statement of Financial
Accounting Standard No. 5, "Accounting for Contingencies." Current reserves
established for known or probable remediation activities are not material to the
company's financial position or results of operations.
Management believes that current cash and cash equivalents, cash flows from
operations and its unsecured revolving credit facility should be sufficient
during fiscal 1999 and beyond to fund its planned capital expenditures, working
capital needs, dividends, stock repurchases and other cash requirements.
However, management believes it could secure additional capital at favorable
rates, if needed, to support its capital expansion program.
YEAR 2000 ISSUE
The company is currently developing a new information system for most of its
critical financial, distribution and manufacturing applications. The system is
scheduled for completion and implementation by the summer of 1999 at an
estimated total cost of about $10 million. While the primary purpose of this new
information system is to modernize and improve the company's operations, it is
also expected to resolve the Year 2000 issues in these critical computer
systems. Costs to develop this new information system are being capitalized.
Other costs relating to Year 2000 readiness are being expensed as incurred. As
of September 30, 1998, the company's expenditures for its new information system
have been $5,016,000, and its expenditures for its Year 2000 readiness projects
have been less than $250,000. At this time, other than the cost of developing
and implementing its new information system, the company does not believe that
the costs of addressing the Year 2000 issue will be material. The company does
not believe that other critical information systems work has been deferred due
to its Year 2000 efforts.
The company also has teams of employees and consultants who are reviewing other
computer applications and systems not included in the scope of the new
information system, including systems other than information systems that have
embedded technology, and its interaction with its suppliers, customers and other
business partners for Year 2000 readiness. The company is close to completing
the process of taking relevant inventory, assessing risk, assigning priorities
to various tasks and performing limited internal tests. The company has
completed its initial remedial programming for its mainframe computer system and
is ready to begin testing this system. The company has developed contingency
plans for its critical information system which primarily consist of making its
existing information system Year 2000 compliant in the event the new system is
not completed by its scheduled date. Contingency plans for other aspects of Year
2000 readiness are currently being developed. The company expects to have fully
developed action plans by the end of calendar 1998, and to have completed
integrated testing and any remediation before January 1, 2000.
The company believes the Year 2000 readiness project is on schedule for timely
completion. Based on a current assessment of risks relating to its Year 2000
readiness, the company does not believe that this issue will result in
uncertainty that is reasonably likely to materially affect future financial
results or operating performance.
10
<PAGE> 11
FORWARD-LOOKING STATEMENTS
This Form 10-Q contains "forward-looking statements" about the company's
prospects for the future. Such statements are subject to certain risks and
uncertainties which could cause actual results to differ materially from those
projected. Such risks and uncertainties include, but are not limited to, the
following:
1. The company's roofing products business is cyclical and is
affected by weather and some of the same economic factors that
affect the housing and home improvement industries generally,
including interest rates, the availability of financing and
general economic conditions. In addition, the asphalt roofing
products manufacturing business is highly competitive. Actions
of competitors, including changes in pricing, or slowing
demand for asphalt roofing products due to general or industry
economic conditions or the amount of inclement weather could
result in decreased demand for the company's products, lower
prices received or reduced utilization of plant facilities.
Further, changes in building codes and other standards from
time to time can cause changes in demand, or increases in
costs that may not be passed through to customers.
2. In the asphalt roofing products business, the significant raw
materials are ceramic coated granules, asphalt, glass fibers,
resins and mineral filler. Increased costs of raw materials
can result in reduced margins, as can higher trucking and rail
costs. Historically, the company has been able to pass some of
the higher raw material and transportation costs through to
the customer. Should the company be unable to recover higher
raw material and/or transportation costs from price increases
of its products, operating results could be lower than
projected.
3. During fiscal 1997, the company completed the construction of
a plant at the company's Ennis, Texas facility to manufacture
nonwoven fiberglass roofing mats and other mats for a variety
of industrial uses. The company also expects to make up to
$100 million in new investments to expand capacity and improve
productivity at existing plants and to build new plants over
the next three years. Progress in achieving anticipated
operating efficiencies and financial results is difficult to
predict for new plant facilities. If such progress is slower
than anticipated, if substantial cost overruns occur in
building new plants, or if demand for products produced at new
plants does not meet current expectations, operating results
could be adversely affected.
4. Certain facilities of the company's industrial products
subsidiaries must utilize hazardous materials in their
production process. As a result, the company could incur costs
for remediation activities at its facilities or off-site, and
other related exposures from time to time in excess of
established reserves for such activities.
5. The company's litigation, including its patent infringement
suits against GAF Building Materials Corporation and certain
affiliates, is subject to inherent and case-specific
uncertainty. The outcome of such litigation depends on
numerous interrelated factors, many of which cannot be
predicted.
11
<PAGE> 12
6. Even with fully developed action and contingency plans for
Year 2000 readiness, it is possible that the company will not
achieve full internal readiness. Further, the company's
business may be adversely affected by external Year 2000
disruption that the company is not in position to control,
including but not limited to potential disruptions in power
and other energy supplies, telecommunications or other
infrastructure, potential disruptions in transportation and
the supply of raw materials, and potential disruptions in
financial and banking systems. Year 2000 problems therefore
could result in unanticipated expenses or liabilities,
production or disruption delays or other adverse effects on
the company.
7. Although the company currently anticipates that most of its
needs for new capital in the near future will be met with
internally generated funds, significant increases in interest
rates could substantially affect its borrowing costs under its
existing loan facility, or its cost of alternative sources of
capital.
8. Each of the company's businesses, especially its Conductive
Coatings Division's business, is subject to the risks of
technological changes that could affect the demand for or the
relative cost of the company's products and services, or the
method and profitability of the method of distribution or
delivery of such products and services. In addition, the
company's businesses each could suffer significant setbacks in
revenues and operating income if it lost one or more of its
largest customers.
9. Although the company insures itself against physical loss to
its manufacturing facilities, including business interruption
losses, natural or other disasters and accidents, including
but not limited to fire, earthquake, damaging winds and
explosions, operating results could be adversely affected if
any of its manufacturing facilities became inoperable for an
extended period of time due to such events.
Parties are cautioned not to rely on any such forward-looking beliefs or
judgments in making investment decisions.
12
<PAGE> 13
PART II. OTHER INFORMATION
ITEM 6: Exhibits and Reports of Form 8-K
(a) Exhibit:
Exhibit (27): Financial Data Schedule (EDGAR submission only)
(b) The registrant filed two reports on Form 8-K during the quarter
ended September 30, 1998. The registrant filed a Form 8-K on
August 19, 1998 and a Form 8-K on September 28, 1998, both
relating to press releases containing "forward-looking
statements" about its prospects for the future.
13
<PAGE> 14
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ELCOR CORPORATION
DATE: November 13, 1998 /s/ Richard J. Rosebery
-------------------------- --------------------------------------
Richard J. Rosebery
Vice Chairman, Chief Financial &
Administrative Officer and Treasurer
/s/ Leonard R. Harral
--------------------------------------
Leonard R. Harral
Vice President and Chief
Accounting Officer
14
<PAGE> 15
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Exhibit
- ------- -------
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1999
<PERIOD-START> JUL-01-1998
<PERIOD-END> SEP-30-1998
<CASH> 3,210
<SECURITIES> 0
<RECEIVABLES> 66,360
<ALLOWANCES> 793
<INVENTORY> 22,471
<CURRENT-ASSETS> 94,762
<PP&E> 187,110
<DEPRECIATION> 70,244
<TOTAL-ASSETS> 213,537
<CURRENT-LIABILITIES> 32,314
<BONDS> 43,300
0
0
<COMMON> 13,326
<OTHER-SE> 110,553
<TOTAL-LIABILITY-AND-EQUITY> 213,537
<SALES> 85,868
<TOTAL-REVENUES> 85,868
<CGS> 63,063
<TOTAL-COSTS> 73,335
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 559
<INCOME-PRETAX> 11,974
<INCOME-TAX> 4,448
<INCOME-CONTINUING> 7,526
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> (4,340)
<NET-INCOME> 3,186
<EPS-PRIMARY> .24
<EPS-DILUTED> .24
</TABLE>
