<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1995
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 1-8247
MANVILLE CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 84-0856796
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
717 17th Street
Denver, Colorado 80202
- --------------------------------------------------------------------------------
(Address of principal executive offices)
(Zip Code)
(303) 978-2000
--------------
(Registrant's telephone number, including area code)
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
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 .
----- -----
At May 9, 1995, 122,926,849 shares of the registrant's common stock
were outstanding.
<PAGE> 2
*PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
* "Manville" or the "Company" when used in this report refers to
Manville Corporation, incorporated in the State of Delaware in 1981,
and includes where applicable its consolidated subsidiaries.
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MANVILLE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(Thousands of dollars)
(Unaudited)
<TABLE>
<CAPTION>
March 31, December 31,
ASSETS 1995 1994
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Current Assets
Cash and equivalents $ 238,899 $ 322,003
Marketable securities, at cost
which approximates market 17,479 20,311
Receivables, net of allowances 352,545 335,772
Inventories 248,818 212,774
Prepaid expenses 29,340 28,015
Deferred tax assets 42,898 44,854
--------------------------------------
Total Current Assets 929,979 963,729
Property, Plant and Equipment,
net of accumulated depreciation
and depletion of $1,014,686 and
$963,603, respectively 2,109,488 2,063,557
Deferred Tax Assets 270,262 281,874
Other Assets 503,871 490,451
--------------------------------------
$3,813,600 $3,799,611
==================================================================================================================================
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
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MANVILLE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET (Continued)
(Thousands of dollars)
(Unaudited)
<TABLE>
<CAPTION>
March 31, December 31,
LIABILITIES 1995 1994
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Current Liabilities
Accounts and notes payable $ 305,085 $ 295,510
Compensation and employee benefits 135,543 157,574
Income taxes 26,258 28,739
Other accrued liabilities 151,168 130,748
--------------------------------------
Total Current Liabilities 618,054 612,571
Long-Term Debt, less current portion 1,379,625 1,423,995
Postretirement Benefits Other Than
Pensions 247,647 243,986
Deferred Income Taxes and Other
Noncurrent Liabilities 370,344 359,978
--------------------------------------
2,615,670 2,640,530
--------------------------------------
Profit Sharing Obligation (Note 2)
Contingencies and Commitments (Note 2)
Minority Interest in Consolidated
Subsidiary 98,425 95,610
STOCKHOLDERS' EQUITY
- ----------------------------------------------------------------------------------------------------------------------------------
Cumulative Preference Stock, Series B 178,638 178,638
Common Stock 1,228 1,228
Treasury Stock, at cost (856) (407)
Capital in Excess of Par Value 1,012,103 1,011,310
Unearned Restricted Stock Compensation (5,348) (6,013)
Accumulated Deficit (107,294) (130,394)
Pension Liability Adjustment (435) (435)
Cumulative Currency Translation
Adjustment 21,469 9,544
--------------------------------------
1,099,505 1,063,471
--------------------------------------
$3,813,600 $3,799,611
==================================================================================================================================
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
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MANVILLE CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF INCOME
AND ACCUMULATED DEFICIT
(Thousands of dollars, except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Three Months
Ended March 31,
-------------------------------------
INCOME 1995 1994
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Net Sales $ 641,577 $ 531,677
Cost of Sales 472,449 411,750
Selling, General and Administrative 68,709 61,898
Research, Development and Engineering 10,334 8,864
Other Income (Loss), net (6,335) (4,218)
-------------------------------------
Income from Operations 83,750 44,947
Interest Income 4,765 2,171
Interest Expense 38,475 31,937
Profit Sharing Expense (Note 2) 7,487 2,077
-------------------------------------
Income before Income Taxes 42,553 13,104
Income Taxes 18,936 5,258
-------------------------------------
Income before Equity in Earnings
of Affiliate and Minority Interest 23,617 7,846
Equity in Earnings of Affiliate,
net of taxes 7,740
Minority Interest in Consolidated
Subsidiary (2,026) (460)
-------------------------------------
Net Income 29,331 7,386
Preference Stock Dividends (6,231) (6,231)
-------------------------------------
Net Income Applicable
to Common Stock $ 23,100 $ 1,155
==================================================================================================================================
ACCUMULATED DEFICIT
- ----------------------------------------------------------------------------------------------------------------------------------
Accumulated Deficit at Beginning of Period $(130,394) $(142,467)
Net Income 29,331 7,386
Preference Stock Dividends (6,231) (6,231)
-------------------------------------
Accumulated Deficit at End of Period $(107,294) $(141,312)
==================================================================================================================================
EARNINGS PER COMMON SHARE (AFTER PREFERENCE
STOCK DIVIDENDS)
- ----------------------------------------------------------------------------------------------------------------------------------
Primary and Fully Diluted:
Net Income Applicable to Common Stock $.19 $.01
==================================================================================================================================
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
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MANVILLE CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Thousands of dollars)
(Unaudited)
<TABLE>
<CAPTION>
Three Months
Ended March 31,
------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES: 1995 1994
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Net income (before Preference Stock Dividends) $ 29,331 $ 7,386
Non-cash items included in net income:
Depreciation, depletion and amortization 36,920 36,436
Deferred taxes 12,316 (2,134)
Roofing guarantee income 2,038 1,008
Provision for furnace rebuild 2,114 1,950
Pensions and postretirement benefits expense 7,808 6,971
Interest expense 437
Profit sharing expense 7,487 2,077
Translation loss 3,189
Equity in earnings of affiliate (7,740)
Minority interest in net earnings of
consolidated subsidiary 2,026 460
Other, net 3,119 2,661
(Increase) decrease in current assets:
Receivables (6,506) (10,308)
Inventories (33,348) (4,895)
Prepaid expenses 2,037 (5,370)
Increase (decrease) in current liabilities:
Accounts payable (17,639) (13,565)
Compensation and employee benefits (27,854) (19,560)
Income taxes (1,889) 7,765
Other accrued liabilities 11,735 16,021
Decrease in postretirement benefits
other than pensions (3,330) (424)
Increase (decrease) in other noncurrent
liabilities 352 (3,267)
------------------------------------
Net cash provided by operating activities 19,414 26,401
------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
- ----------------------------------------------------------------------------------------------------------------------------------
Purchases of property, plant and equipment (60,689) (84,601)
Proceeds from sales of assets 2,114 7,801
Purchases of held-to-maturity
marketable securities (14,798) (62,744)
Proceeds from sales of held-to-maturity
marketable securities 17,630 48,109
(Increase) decrease in other assets 2,282 (3,130)
------------------------------------
Net cash used in investing activities (53,461) (94,565)
------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
- ----------------------------------------------------------------------------------------------------------------------------------
Issuance of debt 872 32,573
Payments on debt (45,438) (19,871)
Dividends on Preference Stock (6,231) (4,154)
Minority interest in dividend from
consolidated subsidiary (489) (484)
Other stock transactions 1,756
Treasury stock (449) (407)
------------------------------------
Net cash provided by (used in)
financing activities (49,979) 7,657
------------------------------------
Effect of Exchange Rate Changes on Cash 922 (185)
------------------------------------
Net Decrease in Cash and Equivalents (83,104) (60,692)
Cash and Equivalents at Beginning of Period 322,003 153,093
------------------------------------
Cash and Equivalents at End of Period $238,899 $ 92,401
==================================================================================================================================
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
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MANVILLE CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Manville Corporation is an international holding company with two principal
operating subsidiaries, Riverwood International Corporation ("Riverwood") and
Schuller International Group, Inc. ("Schuller"), collectively referred to as
the "Company." When referring to the holding company only, Manville
Corporation is defined as the "Manville holding company." The Manville holding
company owns 100 percent of Schuller and approximately 81.4 percent of
Riverwood.
Manville Personal Injury Settlement Trust (the "PI Trust") owns approximately
78 percent of the Company's Common Stock. In addition, the Company has a debt
obligation to the PI Trust and an obligation to pay annually 20 percent of its
net earnings, as adjusted, to the PI Trust (see Note 2).
On December 29, 1994, Riverwood sold just under 50 percent of its investment in
its Brazilian operations (Igaras) after first spinning off a wholly owned
subsidiary to operate Riverwood's packaging machinery operations in Brazil.
Prior to that date, Riverwood owned 100 percent of Igaras and included the
results of operations of Igaras in the Containerboard business segment through
the date of sale. Subsequent to December 29, 1994, Riverwood no longer
consolidates Igaras, but instead reports its investment in Igaras using the
equity method of accounting.
The condensed consolidated financial statements as of March 31, 1995 and
December 31, 1994 and for the three months ended March 31, 1995 and 1994
reflect all normal, recurring adjustments which are, in the opinion of
management, necessary for a fair presentation of the financial condition and
the results of operations for the periods presented. The year-end condensed
consolidated balance sheet was derived from audited financial statements, and
as presented does not include all disclosures required by generally accepted
accounting principles.
The Company has reclassified the presentation of certain prior period
information to conform with the current presentation format.
Additional information regarding the Company's accounting policies, operations,
financial position, reorganization proceedings and the PI Trust is contained or
incorporated in the Company's Form 10-K for the year ended December 31, 1994
filed with the Securities and Exchange Commission.
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<PAGE> 8
Note 1 - Inventories
The major classes of inventories were as follows:
<TABLE>
<CAPTION>
(Thousands of dollars)
March 31, December 31,
1995 1994
------------------------------------
<S> <C> <C>
Finished goods $104,575 $ 83,922
Work-in-process 35,487 28,517
Raw materials 67,833 56,934
Supplies 40,923 43,401
------------------------------------
$248,818 $212,774
====================================
</TABLE>
Note 2 - Contingencies and Commitments
The Company has an obligation to pay annually 20 percent of its net earnings
(as adjusted) to the PI Trust. Payments to the PI Trust are due each year
based on the prior year's net earnings and will continue for as long as the PI
Trust is in existence. After termination of the PI Trust, an independent
profit sharing obligation on the same terms arises in favor of Manville
Property Damage Settlement Trust, if it is in existence after the termination
of the PI Trust. Based upon a review of the existing and potential claims
facing the two trusts, the Company believes that profit sharing, for all
practical purposes, will be payable in perpetuity unless the Company and one or
both of the trusts agree to a restructuring or modification of the profit
sharing obligation at some future date. In the first quarter of 1995, the
Company recorded $7.5 million of profit sharing expense to be paid in 1996.
Between 1988 and 1992, the Company manufactured phenolic roofing insulation
which, the Company has learned, contributes to the corrosion of metal decks on
which it is installed. Subsequently, the Company exited the phenolic roofing
insulation business and embarked upon a voluntary sampling and inspection
program of such metal decks.
The Company estimates that approximately 63 million square feet of metal roof
deck are insulated with the Company's phenolic roof product, of which
approximately 50 percent had been inspected as of March 31, 1995. Based on the
statistics compiled from the inspection and sampling program and the Company's
claims experience through March 31, 1995 and assuming this experience continues
into the future, approximately 1.8 million square feet of roof deck have been
remediated or will require remediation. In most cases only "spot remediation"
has been required to address the damage to the roof decks. However, the exact
square footage of roof deck that will require remediation and the actual cost
of such remediation are dependent upon a number of variables and cannot be
determined at this time. Through March 31, 1995, the cumulative cash expended
by the Company for sampling, inspection, remediation and claims settlement was
$10 million.
At March 31, 1995, the Company's accrual for future sampling, inspection,
remediation and present and anticipated claims totaled $8.5 million. This
amount was computed by giving effect to information available from the
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Company's inspection and sampling program conducted through March 31, 1995,
remediation experience, historical claims experience, the types of roofs on
which phenolic insulation has been installed and the average cost of
remediation, as well as the Company's assumption that its past remediation
experience will continue into the future. At March 31, 1995, the Company is in
the initial stages of litigation with respect to two phenolic-related claims
against the Company.
The Company has insurance that applies to property damage resulting from metal
deck corrosion. During the first quarter of 1995, the Company and its primary
insurance carrier reached a settlement regarding the extent of coverage. Under
the terms of a confidential settlement agreement, the Company's insurance
carrier will be responsible for a portion of certain phenolic-related costs.
The insurance carrier's portion of costs under the settlement agreement is
expected to more than satisfy the $7 million receivable previously recorded by
the Company for future expected recoveries. In 1993, the Company filed a
lawsuit against Beazer East, Inc., the former owner of the phenolic roofing
insulation business. Trial in that case is scheduled to commence in June 1995.
Based upon the settlement agreement and the experience, information and
assumptions referred to above, in management's opinion the range of the
Company's portion of the ultimate gross loss with respect to sampling,
inspection, remediation and claims settlement in excess of amounts previously
accrued is between zero and $20 million.
The Company is engaged in environmental remediation projects for properties
currently owned or operated by the Company and properties divested by the
Company for which responsibility was retained for preexisting conditions. In
addition, the Company has been identified as a potentially responsible party at
a number of non-Company owned or operated sites under the federal Comprehensive
Environmental Response, Compensation and Liability Act or similar state
legislation, and as such could be jointly and severally liable for the costs of
remediating these sites. The Company's actual final cost in some instances
cannot be estimated until the remediation process is substantially completed.
Environmental law is dynamic rather than static. As a result, costs that are
unforeseeable at this time may be incurred when new laws are enacted, and/or
the environmental agencies promulgate or revise regulations in furtherance of
such legislation. In response to the implementation of the 1990 amendments to
the federal Clean Air Act and requirements of various state air emissions
regulations, the Company will be obligated to monitor emissions at its
manufacturing sites. Because many of the anticipated regulations have not yet
been proposed, neither the costs nor timing of compliance can be reasonably
anticipated at this time. Provisions of the 1990 amendments and the related
regulations will likely require capital expenditures in the years 1995 to 2001,
with most of the expenditures occurring in the latter part of that time frame.
In addition, the federal Environmental Protection Agency has issued new
proposed regulations for the pulp and paper industry, although it is expected
that the earliest time for industry compliance with these proposed regulations
should not be prior to the first quarter of 2000. At this time, Riverwood
estimates capital spending that may be required to comply with the pulp and
paper industry
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<PAGE> 10
proposed regulations could be between $20 million and $40 million to be spent
over a three-year period beginning in 1997.
The Company periodically reviews and, as appropriate, revises its environmental
accruals. Based on current information and regulatory requirements, the
Company believes that to the extent additional costs may be incurred that might
exceed the accrued amounts, such amounts are not expected to have a material
adverse effect on the Company's financial condition, liquidity or results of
operations.
Note 3 - Income Taxes
In the first quarter of 1994, the Company recognized a deferred tax benefit of
$0.8 million primarily related to a tax law change in Sweden that reduced the
statutory Swedish federal tax rate to 28 percent from 30 percent.
Exclusive of the tax benefit on the Swedish tax law change, the Company's first
quarter 1995 and 1994 tax rates were 44.5 percent and 46 percent, respectively.
These are higher than the U.S. federal statutory rate primarily due to U.S.
state and local taxes and higher foreign effective tax rates.
Note 4 - Earnings Per Common Share
Primary earnings per common share amounts are based on the weighted average
number of common and common equivalent shares outstanding during the period.
For the first quarter of 1995, primary and fully diluted earnings per common
share amounts were based on 122,863,000 and 122,873,000 common equivalent
shares, respectively. For the first quarter of 1994, primary and fully diluted
earnings per common share amounts were based on 122,431,000 common equivalent
shares.
Earnings per share amounts were calculated after the deduction for preference
stock dividends.
Note 5 - Acquisition
In January 1995, Riverwood acquired a 70 percent interest in the Lemaire Group,
a French company which supplies beverage and folding cartons in France and
central Europe from four carton converting facilities in France. Terms of the
acquisition require Riverwood to purchase the Lemaire Group's remaining 30
percent interest prior to 1998. Accordingly, Riverwood recorded a $10.2
million note payable for the unpaid portion of the purchase price which bears
interest at six percent per annum. This acquisition involved the purchase of
assets with a fair value of $27 million and the assumption of liabilities of
$16.9 million.
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Note 6 - Business Segment Information
<TABLE>
<CAPTION>
(Thousands of dollars)
Manville Corporation Three Months
Consolidated Major Business Segments Ended March 31,
1995 1994
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Net Sales
- ----------------------------------------------------------------------------------------------------------------------------------
Riverwood International:
Coated Board System $218,290 $169,952
Containerboard 58,693 64,421
U.S. Timberlands/Wood Products 41,036 34,526
Corporate and Eliminations (4,843) (3,991)
- ----------------------------------------------------------------------------------------------------------------------------------
313,176 264,908
- ----------------------------------------------------------------------------------------------------------------------------------
Schuller International:
Building Products 179,132 145,581
Engineered Products 156,199 126,092
Corporate and Eliminations (6,930) (4,643)
- ----------------------------------------------------------------------------------------------------------------------------------
328,401 267,030
- ----------------------------------------------------------------------------------------------------------------------------------
Manville Corporate and Eliminations (261)
- ----------------------------------------------------------------------------------------------------------------------------------
Total Company Net Sales $641,577 $531,677
==================================================================================================================================
Income (Loss) From Operations
- ----------------------------------------------------------------------------------------------------------------------------------
Riverwood International:
Coated Board System $ 16,579 $ 23,653
Containerboard 8,862 (6,999)
U.S. Timberlands/Wood Products 16,225 12,217
Corporate and Eliminations (10,764) (6,373)
- ----------------------------------------------------------------------------------------------------------------------------------
30,902 22,498
- ----------------------------------------------------------------------------------------------------------------------------------
Schuller International:
Building Products 29,848 14,999
Engineered Products 32,201 15,355
Corporate and Eliminations (6,329) (6,829)
- ----------------------------------------------------------------------------------------------------------------------------------
55,720 23,525
- ----------------------------------------------------------------------------------------------------------------------------------
Manville Corporate and Eliminations (2,872) (1,076)
- ----------------------------------------------------------------------------------------------------------------------------------
Total Company Income from
Operations $ 83,750 $ 44,947
==================================================================================================================================
</TABLE>
Net sales included in Corporate and Eliminations relate primarily to the
elimination of intersegment sales (at prices approximating market).
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Report of Independent Accountants
To the Stockholders and Directors
of Manville Corporation:
We have reviewed the accompanying condensed consolidated balance sheet of
Manville Corporation as of March 31, 1995 and the related condensed
consolidated statement of income and accumulated deficit and cash flows for the
three month periods ended March 31, 1995 and 1994. These financial statements
are the responsibility of the Company's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted
in accordance with generally accepted auditing standards, the objective of
which is the expression of an opinion regarding the financial statements taken
as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the condensed consolidated financial statements for them to be in
conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet as of December 31, 1994, and the
related consolidated statements of income, stockholders' equity and cash flows
for the year then ended (not presented herein); and in our report dated
February 6, 1995, we expressed an unqualified opinion on those consolidated
financial statements. In our opinion, the information set forth in the
accompanying condensed consolidated balance sheet as of December 31, 1994, is
fairly stated in all material respects in relation to the consolidated balance
sheet from which it has been derived.
/s/ COOPERS & LYBRAND L.L.P.
- ----------------------------
COOPERS & LYBRAND L.L.P.
Denver, Colorado
May 11, 1995
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<PAGE> 13
ITEM 2.
MANVILLE CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Manville Corporation is an international holding company with two principal
operating subsidiaries, Riverwood International Corporation ("Riverwood") and
Schuller International Group, Inc. ("Schuller"), collectively referred to as
the "Company." When referring to the holding company only, Manville
Corporation is defined as the "Manville holding company." The Manville holding
company owns 100 percent of Schuller and approximately 81.4 percent of
Riverwood. The Company reports the results of Riverwood's and Schuller's
operations in five business segments.
Riverwood reports its results in three business segments: Coated Board System,
Containerboard and U.S. Timberlands/Wood Products. The Coated Board System
segment includes the production and sale of coated board from paperboard mills
in the United States and Europe; converting facilities in the United States,
Australia and Europe; and worldwide packaging machinery operations related to
the production and sale of beverage and folding cartons. The Containerboard
segment includes the production and sale of linerboard, corrugating medium and
kraft paper from two paperboard mills in the United States. The U.S.
Timberlands/Wood Products segment includes timberlands and operations engaged
in the supply of pulpwood to the West Monroe, Louisiana, mill from Riverwood's
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U.S. timberlands, as well as the manufacture and sale of lumber and plywood.
Prior to December 29, 1994, the Containerboard business segment included
timberlands and associated containerboard mills and corrugated box plants at
Igaras Papeis e Embalagens S.A. ("Igaras") in Brazil. At that date, Riverwood
owned 100 percent of Igaras and included the results of operation of Igaras in
the Containerboard business segment. On December 29, 1994, Riverwood sold just
under 50 percent of its investment in Igaras, after first spinning off a wholly
owned subsidiary to operate Riverwood's packaging machinery operations in
Brazil. Subsequent to that date, Riverwood no longer consolidates Igaras, but
instead reports its investment in Igaras using the equity method of accounting
since Riverwood no longer controls Igaras.
Schuller manufactures and markets insulation for buildings and equipment,
commercial roofing systems, high efficiency air filtration media and fibers and
nonwoven mats used as reinforcements in building and industrial applications.
Schuller operates 35 manufacturing facilities in the United States, Canada and
Germany, and is comprised of two principal business segments: Building
Products and Engineered Products. The Building Products segment consists of
Schuller's building insulation business, which manufactures fiberglass wool
insulation for walls and attics in residential and commercial buildings; the
commercial roofing systems business, which supplies roofing membranes,
insulations, accessories and related guarantees; and the mechanical insulations
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<PAGE> 15
business, which manufactures pipe and duct insulation for use in commercial
buildings, factories, refineries and other industrial applications. The
Engineered Products segment consists of Schuller's specialty insulations and
filtration business which manufactures thermal and acoustic insulation for
aircraft, appliances, automobiles and heating, ventilating and air conditioning
("HVAC") equipment; air filtration media for commercial and industrial
buildings; and microfibers for clean room air filters. The Engineered Products
segment also includes Schuller's mats and reinforcements business which
manufactures continuous filament fiberglass-based products used for reinforcing
roofing, flooring, wall covering and plastic products. The mats and
reinforcements business includes Schuller's German subsidiary, Schuller GmbH.
Financial results for the Manville holding company's interest in Stillwater
Mining Company, a company engaged in the exploration, development, mining and
production of palladium, platinum and associated metals, are included in
Manville Corporate and Eliminations for business segment reporting purposes.
RIVERWOOD RESULTS OF OPERATIONS BY SEGMENT
Riverwood reported its results of operations in its first quarter 1995 Form
10-Q substantially as presented below.
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<PAGE> 16
Net sales in the first quarter of 1995 increased by $48.3 million, or 18.2
percent, compared with the first quarter of 1994. Net sales in the Coated
Board System segment increased by $48.3 million in the first quarter of 1995,
or 28.4 percent, due principally to increased volume in worldwide beverage
markets and coated board open markets, as well as increased selling prices in
some international folding carton markets. Included in the increased volume in
beverage markets is the effect of recent acquisitions. Net sales in the
Containerboard segment in the first quarter of 1995 decreased $5.7 million, or
8.9 percent, compared with the first quarter of 1994. Excluding the operations
of Igaras which were included in this business segment in the first quarter of
1994, net sales in the Containerboard segment increased $18.4 million, or 45.6
percent, primarily due to selling price increases which more than offset the
volume decrease that resulted from conversion of over half of the linerboard
capacity to coated board capacity at the Macon, Georgia mill. Net sales in the
U.S. Timberlands/Wood Products segment increased by $6.5 million, or 18.9
percent, due principally to volume increases for lumber and plywood and selling
price increases for plywood, which more than offset the effects of lower
selling prices for lumber.
Gross profit for the first quarter of 1995 increased $11 million, or 18.8
percent, from the first quarter of 1994. The gross profit margin increased to
22.2 percent for 1995 from 22.1 percent in 1994. Gross profit in the Coated
Board System segment decreased by
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$2 million, or 4.5 percent, while its gross profit margin decreased to 19.3
percent from 26 percent. Higher volume in beverage and coated board open
markets and price increases in some international folding carton markets were
more than offset by cost increases and lower margins related to the mix of
beverage carton sales. The cost increases were principally the result of
higher production costs of coated board at the Macon mill, increased converting
costs in North America and increased raw materials costs at Riverwood's U.S.
mills and in some of its international beverage and folding carton businesses.
In the Containerboard segment, gross profit increased $8.8 million, or almost
fivefold, while the gross profit margin increased to 18.1 percent from 2.8
percent. The increase in gross profit was due primarily to higher
containerboard selling prices worldwide. Excluding the operations of Igaras,
which were included in this business segment in the first quarter of 1994,
gross profit increased $13.9 million from a loss in 1994. This increase was
due primarily to price increases that more than offset the increased cost of
recycled fiber and the volume decrease that resulted from the realignment of
production capacity at Riverwood's Macon mill. Gross profit in the U.S.
Timberlands/Wood Products segment increased by $4.3 million, or 34.2 percent,
and the gross profit margin increased to 41.3 percent from 36.6 percent. In
addition to volume increases for plywood and lumber and selling price increases
for plywood, gross profit and the gross profit margin in this business segment
increased due to lower raw materials costs as Riverwood used a greater portion
of logs from
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<PAGE> 18
its own timberlands in the first quarter of 1995 than in the first quarter of
1994.
Total board mill shipments for the first quarters of 1995 and 1994, including
shipments to Riverwood's integrated converting plants and including 81,400 tons
of containerboard shipments from Igaras in 1994, were as follows:
1995 1994
---- ----
(Thousands of tons)
Coated Board 252.0 183.9
Containerboard 129.5 243.7
----- -----
381.5 427.6
===== =====
As a percent of net sales, selling, general and administrative expenses in the
first quarter of 1995 decreased 1.8 percentage points to 10.5 percent, while
selling, general and administrative expenses increased $0.4 million, or 1.2
percent compared with the first quarter of 1994. Excluding the operations of
Igaras, which were reported on a consolidated basis in the first quarter of
1994, selling, general and administrative expenses increased $3.7 million,
primarily due to increases in selling and marketing expenses and international
administrative expenses to penetrate worldwide coated board markets, as well as
an increase of approximately $2.3 million in the first quarter of 1995 to cover
the expense of stock-based management incentive plans. These increases were
partially offset by certain decreases in
I-17
<PAGE> 19
administrative expenses, principally in the Containerboard business segment.
Research, development and engineering expenses increased by $1.7 million to
$3.9 million, primarily due to a higher level of packaging machinery
engineering costs associated with expanding packaging machinery operations.
Income from operations in the first quarter of 1995 increased by $8.4 million,
or 37.4 percent, compared with the first quarter of 1994, while the operating
margin as a percent of net sales increased to 9.9 percent from 8.5 percent.
The Coated Board System segment's income from operations decreased $7.1
million, or 29.9 percent, to $16.6 million in the first quarter of 1995, and
the operating margin decreased to 7.6 percent from 13.9 percent. In addition
to manufacturing-related cost increases and lower margins related to the mix of
beverage carton sales, increased volume and selling prices in certain coated
board markets were more than offset by increases in selling and marketing
expenses and international administrative expenses to penetrate worldwide
coated board markets. Income from operations in the Containerboard segment
increased $15.9 million to $8.9 million in the first quarter of 1995 from a
loss in the first quarter of 1994. Excluding the operations of Igaras, which
were included in this business segment in the first quarter of 1994, income
from operations increased $16.4 million from the first quarter of 1994, due
principally to increased selling prices that more than offset cost increases in
recycled fiber and the decrease in containerboard
I-18
<PAGE> 20
volume at the Macon mill. This business segment also benefited in the first
quarter of 1995 from decreased administrative expenses. Income from operations
in the U.S. Timberlands/Wood Products segment increased $4 million, or 32.8
percent, in the first quarter of 1995, and the operating margin increased to
39.5 percent from 35.4 percent in the first quarter of 1994. These increases
were due principally to increased lumber and plywood volume, increased plywood
selling prices and lower log costs as Riverwood used a greater portion of logs
from its own timberlands in the first quarter of 1995 than in the first quarter
of 1994.
Fluctuations in U.S. dollar currency exchange rates did not have a significant
impact on net sales, gross profit, operating expenses or income from operations
of Riverwood or any of its business segments.
SCHULLER RESULTS OF OPERATIONS BY SEGMENT
Schuller reported its results of operations in its first quarter 1995 Form 10-Q
substantially as presented below.
Schuller's net sales for the first quarter of 1995 increased $61.4 million, or
23 percent, from $267 million in the first quarter of 1994 to $328.4 million.
The Building Products segment's first quarter 1995 net sales increased $33.6
million, or 23 percent, compared with the same
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<PAGE> 21
period of 1994. This segment's businesses benefitted from increases in both
industrial and residential construction compared to the first quarter of 1994.
Strong demand coupled with the industry operating at or near full capacity
resulted in substantial selling price increases being realized by Schuller's
building insulation business. Technological innovations were utilized to
increase production capacity to enable Schuller to benefit from these market
conditions. Net sales of the roofing systems business rose primarily due to
higher sales volumes from increased construction activity, in addition to entry
into Canadian markets as a result of an acquisition completed by Schuller
during 1994. Net sales also increased in the mechanical insulations business
due to continuing demand for Schuller's products which address indoor air
quality concerns, and market share gains for its pipe insulation products.
The Engineered Products segment's first quarter 1995 net sales increased $30.1
million, or 23.9 percent, compared with the same period of 1994. The increase
was essentially attributable to Schuller's mats and reinforcements business,
which experienced higher selling prices and increased sales volume, reflecting
higher levels of U.S. and European construction activity, as well as the
continuing high utilization of continuous filament glass. In addition, the
weakening of the U.S. dollar against the German mark resulted in higher
reported U.S. dollar net sales in the mats and reinforcements business.
Schuller's specialty insulations and
I-20
<PAGE> 22
filtration business' net sales also increased for the first quarter of 1995
compared to 1994 as a result of increased HVAC-related sales and expanding
markets for its clean room air filters and battery separators.
Gross profit for the first quarter of 1995 increased $38.2 million, or 62.2
percent, compared with the first quarter of 1994. Cost of sales increased 11.3
percent over 1994 on a 23 percent increase in net sales, resulting in a 7.4
percentage point improvement in gross profit margin to 30.4 percent for the
first quarter of 1995. The gross profit improvement reflects higher selling
prices, especially in the building insulation and mats and reinforcements
businesses, along with higher sales volumes realized by most of Schuller's
businesses. Additionally, Schuller's gross profit margin benefitted from
reduced fixed costs and manufacturing efficiencies, which when combined, more
than offset production cost increases.
Other operating expenses include selling, general, administrative, research,
development and engineering expenses. These expenses increased $3.9 million,
or 11.2 percent, for the first quarter of 1995 compared with the same period of
1994 primarily due to spending on technology to expand production capacity and
increased selling expenses. These operating expenses decreased as a percentage
of net sales to 11.9 percent in the first quarter of 1995 compared with 13.1
percent for the same period of 1994.
I-21
<PAGE> 23
Other loss, net, for the first quarter of 1995 totaled $5.1 million, an
increase of $2.2 million from $2.9 million recorded in the first quarter of
1994. The increase is primarily attributable to a $2.9 million charge for
additional legal costs incurred and anticipated in connection with Schuller's
litigation brought by Schuller against the former owner of the phenolic roofing
insulation business. Beginning in the fourth quarter of 1994, Schuller changed
its method of recording expenses previously reported as restructuring of
operations pursuant to the consensus of the Emerging Issues Task Force reached
in the fourth quarter of 1994 on Issue No. 94-3, "Liability Recognition for
Costs to Exit an Activity (including Certain Costs Incurred in a
Restructuring)." Accordingly, adjustments to Schuller's accruals related to
its former phenolic roofing insulation business have been reported as a
component of other income (loss).
Income from operations increased $32.2 million from $23.5 million for the first
quarter of 1994 to $55.7 million for the first quarter of 1995. This increase
is due primarily to increased selling prices and sales volumes, as described
above, experienced during the first three months of 1995.
TOTAL COMPANY RESULTS
Total Company net sales in the first quarter of 1995 increased $109.9 million,
or 20.7 percent, from $531.7 million in the first quarter of 1994 to $641.6
million due to improvements at both
I-22
<PAGE> 24
Riverwood and Schuller. Income from operations increased by $38.8 million, or
86.3 percent, over the first quarter of 1994.
Compared with the first quarter of 1994, the Company's interest income
increased $2.6 million to $4.8 million in 1995 from $2.2 million in 1994,
primarily due to higher average cash and marketable securities balances and
higher interest rates during the first quarter of 1995 compared with the first
quarter of 1994.
Compared with the first quarter of 1994, interest expense increased $6.5
million to $38.5 million in the first quarter of 1995. During the first
quarter of 1995, the Company capitalized interest totaling $0.8 million
compared with $6.1 during the first quarter of 1994, of which the majority was
capitalized in connection with the Macon mill conversion project which was
completed in late 1994. Gross interest expense incurred, before capitalization
of interest, was $39.3 million for the first quarter of 1995, a slight increase
when compared with $38.1 million for the same period in 1994.
Profit sharing expense for the first quarter of 1995 totaled $7.5 million, an
increase of $5.4 million from the $2.1 million recorded in the first quarter of
1994, primarily due to higher operating income in 1995 over 1994.
In the first quarter of 1994, the Company recognized a deferred tax benefit of
$0.8 million primarily related to a tax law change in
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<PAGE> 25
Sweden that reduced the statutory Swedish federal tax rate to 28 percent from
30 percent.
Exclusive of the tax benefit on the Swedish tax law change, the Company's first
quarter 1995 and 1994 tax rates were 44.5 percent and 46 percent, respectively.
These are higher than the U.S. federal statutory rate primarily due to U.S.
state and local taxes and higher foreign effective tax rates.
The Company's equity in earnings of affiliate, which was $7.7 million in the
first quarter of 1995, is comprised of the Company's net earnings of Igaras.
Net income applicable to common stock for the first quarter of 1995 was $23.1
million, compared with $1.2 million for the same period of 1994.
Primary and fully diluted earnings per common share for the first quarter of
1995 were both $0.19 as compared with primary and fully diluted earnings per
common share of $0.01 each for the same period in 1994. Earnings per common
share amounts were calculated after deducting preference stock dividends.
Primary and fully diluted earnings per common share amounts for the first
quarter of 1995 were each based on 122,863,000 and 122,873,000 weighted average
common equivalent shares outstanding, respectively. Primary and fully diluted
earnings per common share amounts for the same period
I-24
<PAGE> 26
of 1994 were based on 122,431,000 weighted average common equivalent shares
outstanding.
LIQUIDITY AND CAPITAL RESOURCES
The Company broadly defines liquidity as its ability to generate sufficient
cash flow to satisfy operating requirements, fund capital expenditures and meet
its existing obligations and commitments. In addition, liquidity includes the
ability to obtain appropriate debt and equity financing and to convert into
cash those assets that are no longer required to meet existing strategic and
financial objectives. Therefore, liquidity should not be considered separately
from capital resources, which consist of current or potentially available funds
for use in achieving long-range business objectives and meeting debt service
commitments. Additionally, the Company's relationship with Manville Personal
Injury Settlement Trust (the "PI Trust") should be considered in analyzing
liquidity.
As a result of the Riverwood public offerings completed during 1992 and
issuance of Schuller Senior Notes in 1994, the Manville holding company no
longer has unrestricted access to cash flows generated by Riverwood and
Schuller. In addition, certain of the Company's subsidiaries may be restricted
in the amount of dividends that can be repatriated due to governmental
regulations, economic conditions or provisions contained in financing
agreements. The Manville holding company's ability to generate sufficient cash
in 1995 and
I-25
<PAGE> 27
beyond is dependent upon funds generated from tax sharing agreements with
Riverwood and Schuller, dividends declared by Riverwood and Schuller, asset
dispositions and capital raised through external sources.
Tax sharing agreements between the Manville holding company and Riverwood and
Schuller provide that their U.S. federal and state income taxes be calculated
as if they were independent entities and that such tax amounts be remitted to
the Manville holding company. The Company is able to apply tax benefits to
reduce the consolidated domestic tax obligations, allowing the Manville holding
company to retain a large portion of the cash remitted by Riverwood and
Schuller. The Manville holding company has maintained at least an 80 percent
ownership interest in Riverwood and Schuller in order to preserve the
consolidated tax entity and utilize existing tax benefits.
Riverwood's ability to generate cash in 1995 and beyond is dependent upon funds
generated from operations and the flow of funds from subsidiaries. Funds from
operations are dependent, in part, upon Riverwood's ability to successfully
market the additional coated board capacity from the Macon mill at prices
satisfactory to Riverwood, and to continue to implement its reengineering and
cost reduction programs.
I-26
<PAGE> 28
Riverwood paid quarterly cash dividends of $0.04 per share on its common stock
during the first quarter of 1995 and 1994. As a result, the Manville holding
company received approximately $2.1 million in dividends from Riverwood during
both the first quarter of 1995 and 1994. Riverwood currently intends to
continue paying quarterly dividends of $0.04 per share on its common stock
subject to a number of conditions, including declaration by Riverwood's Board
of Directors and compliance with covenants in debt instruments and other
agreements.
Manville paid a cash dividend of $6.2 million, or $0.675 per share, in the
first quarter of 1995 and $4.2 million, or $0.45 per share, in the first
quarter of 1994 to Cumulative Preference Stock, Series B, stockholders.
At March 31, 1995, the Company had net working capital of $311.9 million,
including cash and marketable securities of $256.4 million. Total cash and
marketable securities located outside of the United States and Canada were
approximately $40.7 million. Approximately $39 million of cash and marketable
securities is held by Riverwood and $95.1 million is held by Schuller.
Cash and marketable securities decreased by approximately $85.9 million during
the first quarter of 1995. This decrease is primarily attributable to cash
used for capital spending and payments on long-term debt.
I-27
<PAGE> 29
Overall, the Company's debt decreased during the first quarter of 1995 by
approximately $40 million principally as a result of repayment of notes payable
and long-term debt. Principal reductions on long-term debt are expected to be
approximately $70 million during 1995, prior to any refinancings. Riverwood
foreign notes payable amounting to $26.1 million at March 31, 1995, which by
their terms are payable in 1995, are classified as current portion of long-term
debt. Riverwood intends to refinance this debt during 1995 to extend its
maturity.
At March 31, 1995, Riverwood had approximately $199 million in revolving credit
facilities for its U.S. and international subsidiaries, of which approximately
$124 million was available for borrowing. In addition, Riverwood had
arrangements with certain international banks for discounting receivables. As
of March 31, 1995, approximately $3 million of overseas receivables were
discounted.
At March 31, 1995, Schuller had credit facilities totaling approximately $173
million including a $100 million domestic receivables sale facility and foreign
working capital facilities, of which approximately $172 million was available
for use.
The Manville holding company had no credit facilities as of March 31, 1995.
However, as of March 31, 1995 the Manville holding company had $122.7 million
of cash and marketable securities and
I-28
<PAGE> 30
had a total of $37.6 million of intercompany notes receivable from Riverwood
and Schuller. The Manville holding company has no debt or other agreements
that place significant restrictions on its or its operating subsidiaries'
ability to incur additional indebtedness.
Excluding capitalized interest, Riverwood's 1995 capital expenditures are
expected to be approximately $165 million to $185 million related primarily to
increasing paper production efficiencies, increasing converting capacity and
producing packaging machinery. In April 1995, Riverwood announced plans to
invest approximately $30 million to build a new carton converting plant in
Georgia. The new carton plant is anticipated to start up in March 1996 and
produce cartons for the 1996 beverage season.
As a result of recently improved economic conditions, new product introductions
and share gains in certain of its businesses, Schuller is currently operating
its fiberglass production facilities at or near their capacity limits.
Management currently plans to increase capacity incrementally through
technology and productivity innovation and capital programs designed to
increase the output of existing plant facilities with minimal fixed cost
growth. During the first quarter of 1995, Schuller increased the production
capacity of its building insulation business with minimal capital expenditures.
These expansions allowed Schuller to benefit from current market demands while
building inventories for
I-29
<PAGE> 31
the upcoming busy season. In addition, several of Schuller's building
insulation competitors have announced capacity expansion programs.
Schuller's capacity expansion programs are periodically revised to reflect
changes in demand, industry capacity and the results of productivity and
technology innovations. Schuller currently estimates capital spending in 1995
of approximately $100 million, half of which will be used in the capacity
expansion programs described above. Capital expenditures for the three months
ended March 31, 1995 totaled $20.9 million, of which approximately $11 million
were attributable to capacity expansion projects. As of March 31, 1995,
outstanding purchase commitments relating to these and other projects totaled
$22 million. Schuller plans to fund future capital spending from existing cash
balances and cash flows generated by operations.
In total, Manville's 1995 capital expenditures are expected to be approximately
$265 million to $295 million, exclusive of capitalized interest.
At March 31, 1995, Schuller had $8.5 million accrued for future sampling,
inspection, remediation and present and anticipated claims related to
Schuller's former phenolic roofing insulation business. During 1995, Schuller
expects to pay approximately $4 million to $6 million for sampling, inspection,
and remediation
I-30
<PAGE> 32
related to its former phenolic roofing insulation business. See Note 2 to the
Consolidated Financial Statements.
The Company is engaged in environmental remediation projects for properties
currently owned or operated by the Company and properties divested by the
Company for which responsibility was retained for preexisting conditions. In
addition, the Company has been identified as a potentially responsible party at
a number of non-Company owned or operated sites under the federal Comprehensive
Environmental Response, Compensation, and Liability Act or similar state
legislation, and as such could be jointly and severally liable for remediation
costs at these sites. The Company's actual final costs in some instances
cannot be estimated until the remediation process is substantially completed.
Environmental law is dynamic, and as a result, costs that are unforeseeable at
this time may be incurred when new laws are enacted, and/or the environmental
agencies promulgate or revise regulations in furtherance of such legislation.
In response to the implementation of 1990 amendments to the federal Clean Air
Act and requirements of various state air emissions regulations, the Company
will be obligated to monitor and reduce air emissions at its manufacturing
sites. The regulations will likely require capital expenditures in the years
1995 to 2001, with most of the expenditures occurring in the latter part of
that time frame. Because many of the anticipated regulations have not yet been
I-31
<PAGE> 33
proposed, neither the costs nor timing of compliance can be reasonably
estimated at this time. In addition, the federal Environmental Protection
Agency has issued new proposed regulations for the pulp and paper industry (the
"Proposed Regulations"). It is expected that the earliest time for industry
compliance with the Proposed Regulations should not be prior to the first
quarter of 2000. At this time, Riverwood estimates capital spending that may
be required to comply with the Proposed Regulations could be between $20
million and $40 million to be spent over a three-year period beginning in 1997.
The Company periodically reviews and, as appropriate, revises its environmental
accruals. Based on current information and regulatory requirements, the
Company believes that to the extent additional costs may be incurred that might
exceed the accrued amounts, such amounts are not expected to have a material
adverse effect on the Company's financial condition, liquidity or results of
operations.
The Company believes that with its current cash position and existing credit
facilities, cash generated from operations, proceeds from the sale of
nonstrategic assets, and access to private and public capital markets, it can
adequately fund normal debt service requirements, its planned capital spending
program, environmental compliance and its other commitments.
I-32
<PAGE> 34
RELATIONSHIP OF MANVILLE TO THE PERSONAL INJURY TRUST
The PI Trust owns approximately 78 percent of Manville's Common Stock. The PI
Trust is an irrevocable trust formed under the laws of the State of New York,
pursuant to a trust agreement dated as of November 28, 1988, as amended (the
"Trust Agreement"), to implement certain portions of the Company's Second
Amended and Restated Plan of Reorganization (the "Plan"), in particular, those
relating to the settlement of asbestos health claims against Manville and
certain of its affiliates. As the owner of approximately 78 percent of
Manville's Common Stock, the PI Trust has effective voting control over the
Company, including the power to nominate and elect Manville directors as the
trustees of the PI Trust determine. Three trustees of the PI Trust currently
serve as members of Manville's Board of Directors.
In furtherance of its purposes under the Trust Agreement of enhancing and
preserving its trust estate and providing compensation to bona fide asbestos
health claimants, the PI Trust has an interest in maximizing the value of, and
at times increasing the liquidity of, its investment in the Company. The PI
Trust may from time to time consider and discuss with management various means
by which the Company might seek to maximize stockholder value and enhance
stockholder liquidity. The Company conducts all negotiations with the PI Trust
on an arm's-length basis, with both parties being represented by their own
legal and financial advisors. Significant transactions with the PI Trust are
reviewed
I-33
<PAGE> 35
by the Board of Directors, after consultation with appropriate external
advisors and experts, to determine that the transactions are fair. In
addition, the Audit Committee of the Board of Directors reviews the accounting
treatment for such transactions.
Beginning in 1992, the Company became obligated under the Plan to pay annually
to the PI Trust 20 percent of net earnings (adjusted as specified in the
definition of "Profits" in the Amended and Restated Supplemental Agreement
between the PI Trust and Manville). Payments are due each year based on the
prior year's net earnings. The profit sharing obligation will continue for as
long as the PI Trust is in existence. After termination of the PI Trust, an
independent profit sharing obligation on the same terms arises in favor of
Manville Property Damage Settlement Trust, if it is in existence after the
termination of the PI Trust. Based upon a review of the existing and potential
claims facing the two trusts, the Company believes that the profit sharing, for
all practical purposes, will be payable in perpetuity unless the Company and
one or both of the trusts agree to a restructuring or modification of the
profit sharing obligation at some future date. The Company paid $18.3 million
to the PI Trust in April 1995 related to 1994 profit sharing.
ADDITIONAL INFORMATION
On April 17, 1995, the Company announced that it is exploring strategic
alternatives which may be available with respect to its
I-34
<PAGE> 36
investment in Riverwood. These alternatives may include the possible sale or
other disposition of its investment. No decision has been made to enter into
any transaction, or as to what form any such transaction might take. Moreover,
any sale by the Company of its investment in Riverwood or any other transaction
involving the sale or merger of Riverwood would require, among other things,
resolution of a number of issues relating to contractual relationships between
the Company and the PI Trust. The PI Trust has stated that it supports
Manville's exploration of its strategic alternatives.
Additional information regarding the Company's accounting policies, operations,
financial position, reorganization proceedings and the PI Trust is contained or
incorporated in the Company's Form 10-K for the year ended December 31, 1994
filed with the Securities and Exchange Commission.
I-35
<PAGE> 37
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
Not applicable.
ITEM 2. CHANGES IN SECURITIES.
Not applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
ITEM 5. OTHER INFORMATION.
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits.
Exhibit 15, Letter of Coopers and Lybrand L.L.P.
Exhibit 27.1, Financial Statement Schedules, dated as of December 31,
1994.
Exhibit 27.2, Financial Statement Schedules, dated as of March 31,
1995.
(b) Reports on Form 8-K.
Not applicable.
II-1
<PAGE> 38
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.
MANVILLE CORPORATION
--------------------
(Registrant)
Date: May 12, 1995 By: /s/ R. B. Von Wald
--------------------------------
R. B. Von Wald
Senior Vice President,
General Counsel and Secretary
Date: May 12, 1995 By: /s/ Robert E. Cole
--------------------------------
Robert E. Cole
Senior Vice President and
Chief Financial Officer
II-2
<PAGE> 39
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. EXHIBIT DESCRIPTION PAGE
- ----------- ------------------- ----
<S> <C>
15 Letter of Coopers & Lybrand L.L.P.
27.1 Financial Data Schedule dated 12/31/94
27.2 Financial Data Schedule dated 3/31/95
</TABLE>
<PAGE> 1
(Coopers & Lybrand Letterhead)
May 12, 1995
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Manville Corporation
Registrations: on Form S-8 (File No. 33-29389)
and Form S-3 (File No. 33-43912)
Gentlemen:
We are aware that our report dated May 11, 1995 on our review of interim
financial information of Manville Corporation for the three month period ended
March 31, 1995 and included in the Company's quarterly report on Form 10-Q for
the quarter then ended is incorporated by reference in the above referenced
registration statements. Pursuant to Rule 436(c) under the Securities Act of
1933, this report should not be considered a part of the registration
statements prepared or certified by us within the meaning of Sections 7 and 11
of that Act.
/s/ COOPERS & LYBRAND LLP
Coopers & Lybrand LLP
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE MARCH
31, 1995 FORM 10-Q OF MANVILLE CORPORATION AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<CASH> 238,899
<SECURITIES> 17,479
<RECEIVABLES> 350,334
<ALLOWANCES> 8,707
<INVENTORY> 248,818
<CURRENT-ASSETS> 929,979
<PP&E> 3,124,174
<DEPRECIATION> 1,014,686
<TOTAL-ASSETS> 3,813,600
<CURRENT-LIABILITIES> 618,054
<BONDS> 1,379,625
<COMMON> 1,228
0
178,638
<OTHER-SE> 919,639
<TOTAL-LIABILITY-AND-EQUITY> 3,813,600
<SALES> 641,577
<TOTAL-REVENUES> 641,577
<CGS> 472,449
<TOTAL-COSTS> 472,449
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 979
<INTEREST-EXPENSE> 38,475
<INCOME-PRETAX> 42,553
<INCOME-TAX> 18,936
<INCOME-CONTINUING> 23,617
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 29,331
<EPS-PRIMARY> .19
<EPS-DILUTED> .19
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the December
31, 1994 Form 10-K of Manville Corporation and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<RESTATED>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-01-1994
<PERIOD-END> DEC-31-1994
<CASH> 322,003
<SECURITIES> 20,311
<RECEIVABLES> 330,856
<ALLOWANCES> 7,527
<INVENTORY> 212,774
<CURRENT-ASSETS> 963,729
<PP&E> 3,027,160
<DEPRECIATION> 963,603
<TOTAL-ASSETS> 3,799,611
<CURRENT-LIABILITIES> 612,571
<BONDS> 1,423,995
<COMMON> 1,228
0
178,638
<OTHER-SE> 883,605
<TOTAL-LIABILITY-AND-EQUITY> 3,799,611
<SALES> 2,560,343
<TOTAL-REVENUES> 2,560,343
<CGS> 1,930,926
<TOTAL-COSTS> 1,930,926
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 1,500
<INTEREST-EXPENSE> 140,984
<INCOME-PRETAX> 161,405
<INCOME-TAX> 95,550
<INCOME-CONTINUING> 65,855
<DISCONTINUED> 0
<EXTRAORDINARY> (28,420)
<CHANGES> 0
<NET-INCOME> 36,996
<EPS-PRIMARY> .10
<EPS-DILUTED> .10
</TABLE>
