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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) July 20, 1994
Commission File Number: 1-1511
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FEDERAL-MOGUL CORPORATION
(Exact name of registrant as specified in its charter)
Michigan 38-0533580
(State or other jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
26555 Northwestern Highway, Southfield, Michigan 48034
(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code: (810) 354-7700
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INFORMATION TO BE INCLUDED IN REPORT
ITEM 5. OTHER EVENTS.
On July 20, 1994, Federal-Mogul Corporation issued a
press release announcing its earnings for the quarter ended June 30, 1994.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
28.1 Press Release, dated July 20, 1994.
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereto duly authorized.
FEDERAL-MOGUL CORPORATION
(George N. Bashara, Jr.)
By:-----------------------------------
George N. Bashara, Jr.
Vice President, General Counsel
and Secretary
Dated as of July 25, 1994<PAGE>
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EXHIBIT INDEX
Exhibit Number Document
99 (Exhibit No. 28.1 of Item 601 of Regulation S-K)
Press Release, dated July 20, 1994 issued by Federal-Mogul
Corporation (filed herewith and incorporated herein by
reference).
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Lonnie Ross 810/354-9934
FOR IMMEDIATE RELEASE
Federal-Mogul announces record second quarter earnings and sales
SOUTHFIELD, MICHIGAN, JULY 20, 1994 . . . Federal-Mogul Corporation
(NYSE-FMO) today reported record net earnings of $20.4 million or $.47 per
common share on a fully diluted basis compared to $15.3 million or $.43 per
common share for the same 1993 period. The 1993 results included a gain of $4.7
million or $.15 per share on the sale of Westwind Air Bearings, Ltd. Record
second quarter 1994 sales of $474.8 million compare to $401.8 million in the
1993 second quarter.
"Our operating margin for the 1994 second quarter increased more than 80
percent over the same quarter in 1993," said Chairman and Chief Executive
Officer Dennis J. Gormley. "The Sealed Power Replacement (SPR) automotive
aftermarket business we acquired in October 1993 contributed to this
improvement. We also continue to reduce operating expenses as we consolidate
the SPR facilities. The integration of the SPR business with Federal-Mogul
remains on target to realize $12 million of savings by year-end.
"In addition, cost savings from global sourcing activities and
manufacturing productivity gains favorably impacted margins," he added.
Total aftermarket sales increased 19 percent in the second quarter
compared to the same quarter in 1993, primarily as a result of the acquisition
of SPR and continued growth exceeding 10 percent in international markets. Base
North American aftermarket sales were flat, with increases in core engine
products offset by decreases in suspension products due to supplier capacity
constraints. These supplier issues are currently being addressed and marked
improvements in performance are expected in the second half of 1994.
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According to Gormley, the company reported original equipment market share
gains in North America. Continued strength in North American auto builds and
better than expected European vehicle production boosted the company's original
equipment sales.
The company successfully completed the consolidation of its Fuel Systems
Division with its Lighting and Electrical Division in the second quarter. This
involved closing a plant in Lafayette, Tennessee, and transferring the work to
a facility in Logansport, Indiana. Savings from the consolidation are on
schedule.
Earnings for the six months ended June 30, 1994 were $35.4 million or $.84
per share on a fully diluted basis compared to $22.8 million (including the
$4.7 million Westwind gain) or $.69 per share for the same 1993 period. Sales
for the first half of 1994 totalled $935.1 million compared to $812.3 million
for the same period in 1993.
Headquartered in Southfield, Michigan, Federal-Mogul is a global
distributor and manufacturer of a broad range of precision parts primarily for
automobiles, light trucks, heavy trucks, and farm and construction vehicles.
The company serves both the aftermarket and the original equipment market
providing quality products -- as they are needed -- to customers around the
world. Federal-Mogul operates 31 plants, more than 80 distribution centers and
four major research centers worldwide.
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F E D E R A L - M O G U L C O R P O R A T I O N
S T A T E M E N T S O F C A S H F L O W S
(Millions of Dollars, Unaudited)
<TABLE>
<CAPTION> Six Months Ended
June 30
1994 1993
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<S> <C> <C>
Cash Provided From (Used By) Operating Activities
Net earnings $ 35.4 $ 22.8
Depreciation and amortization 27.6 26.2
Working capital and other (31.7) (30.1)
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Net Cash Provided From Operating Activities 31.3 18.9
Cash Provided From (Used By) Investing Activities
Expenditures for property, plant and equipment (34.2) (23.0)
Proceeds from sale of business investment .4 16.4
Business investments and other 2.9 (6.6)
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Net Cash Used By Investing Activities (30.9) (13.2)
Cash Provided From (Used By) Financing Activities
Issuance of common stock 196.8 116.7
Net decrease in debt (185.3) (148.8)
Sale of accounts receivable - 39.6
Dividends (13.8) (11.6)
Other .3 1.4
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Net Cash Used By Financing Activities (2.0) (2.7)
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Increase (Decrease) in Cash and Equivalents (1.6) 3.0
Cash and Equivalents at Beginning of Period 24.2 19.1
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Cash and Equivalents at End of Period $ 22.6 $ 22.1
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/TABLE
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F E D E R A L - M O G U L C O R P O R A T I O N
E A R N I N G S S T A T E M E N T
(Millions of Dollars, Except Per Share Data)
(Unaudited)
<TABLE>
<CAPTION>
Quarter Ended Six Months Ended
June 30 June 30
1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net sales $474.8 $401.8 $935.1 $812.3
Cost of products sold 369.9 323.0 733.6 654.6
Selling, distribution and
administrative expenses 64.9 56.6 129.6 113.7
Operating earnings 40.0 22.2 71.9 44.0
Other income (expense):
Amortization of intangible assets (2.3) (2.2) (4.5) (4.2)
Interest expense (4.2) (5.8) (9.3) (14.3)
Interest income 2.1 1.6 3.8 3.6
Gain on sale of business 4.9 4.9
International currency exchange losses (2.7) (.7) (5.4) (1.8)
Other, net .0 2.4 .6 2.7
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Earnings Before Income Taxes 32.9 22.4 57.1 34.9
Income taxes 12.5 7.1 21.7 12.1
Net Earnings $ 20.4 $ 15.3 $ 35.4 $ 22.8
----- ----- ----- -----
----- ----- ----- -----
Earnings Per Common Share
Primary $ .50 $ .47 $ .89 $ .72
----- ----- ----- -----
----- ----- ----- -----
Fully-Diluted $ .47 $ .43 $ .84 $ .69
----- ----- ----- -----
----- ----- ----- -----
Average number of common shares
outstanding (in thousands) 35,518 27,737 34,038 25,064
------ ------ ------ ------
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</TABLE>
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F E D E R A L - M O G U L C O R P O R A T I O N
B A L A N C E S H E E T S
(Millions of Dollars)
<TABLE>
<CAPTION>
June 30 December 31
1994 1993
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(Unaudited)
Assets
<S> <C> <C>
Current Assets:
Cash and equivalents $ 22.6 $ 24.2
Accounts receivable 255.1 186.9
Inventories 318.6 322.3
Prepaid expenses and income tax benefits 42.2 40.6
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Total Current Assets 638.5 574.0
Property, Plant and Equipment 422.6 399.8
Intangible Assets 202.2 199.3
Business Investments and Other Assets 118.5 118.7
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Total Assets $ 1,381.8 $ 1,291.8
Liabilities and Shareholders' Equity
Current Liabilities:
Short-term debt $ 42.5 $ 39.2
Accounts payable 128.3 94.5
Accrued compensation 39.2 31.7
Other accrued liabilities 117.7 117.9
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Total Current Liabilities 327.7 283.3
Long-Term Debt 192.8 382.5
Postretirement Benefits Other than Pensions 153.2 149.9
Other Accrued Liabilities 94.7 92.0
Deferred Income Taxes 9.5 13.0
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Total Liabilities 777.9 920.7
Shareholders' Equity:
Series D preferred stock 76.6 76.6
Series C ESOP preferred stock 60.2 60.2
Unearned ESOP compensation (41.5) (44.6)
Common stock 177.6 147.5
Additional paid-in capital 284.6 117.2
Retained earnings 67.9 46.4
Currency translation and other (21.5) (32.2)
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Total Shareholders' Equity 603.9 371.1
Total Liabilities and Shareholders' Equity $ 1,381.8 $ 1,291.8
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/TABLE
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F E D E R A L - M O G U L C O R P O R A T I O N
N O T E T O F I N A N C I A L S T A T E M E N T S
J U N E 3 0 , 1 9 9 4
1. EARNINGS PER SHARE
The computation of earnings per share is based on the weighted average
number of outstanding common shares and common stock equivalents during
the respective periods, and was therefore impacted by the issuance of 5.75
million shares of common stock in February 1994 and 6.25 million shares of
common stock in April 1993. Net earnings used in the computations of
earnings per share are reduced by preferred stock dividend requirements.
