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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)
April 15, 1998
FMC CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 1-2376 94-4079804
- ---------------------------- ----------- ------------------
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
200 East Randolph Drive, Chicago, Illinois 60601
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(Address of principal executive offices) (Zip Code)
(312) 861-6000
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Registrant's telephone number,
including area code
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Item 5. Other Events
On April 15, 1998, FMC Corporation issued the following release:
FMC REPORTS 1998 FIRST QUARTER RESULTS
CHICAGO, April 15, 1998 -- FMC Corporation today reported first quarter sales of
$1 billion, up slightly from the 1997 first quarter. After-tax income from
continuing operations, before the cumulative effect of a change in accounting
principle, was $27 million, up 26 percent from $21 million in last year's
quarter. Earnings per share from continuing operations on a diluted basis,
before the effect of the change in accounting principle, were $0.75 in the first
quarter 1998, compared with $0.56 in the 1997 period.
According to FMC Chairman and Chief Executive Officer Robert N. Burt:
"First quarter results are a solid indication that we are recovering and gaining
momentum from our fourth quarter earnings problems. We believe our results will
show similar trends in the second quarter and the remainder of the year."
Review of Operations
Machinery and Equipment sales of $466 million were essentially flat
compared with the first quarter of 1997. Profits of $23 million were up 38
percent from $17 million in last year's quarter. Energy equipment profits were
up from the first quarter 1997, reflecting higher sales and margins as the
energy business continued its momentum from last year. In addition, FMC received
a $230 million order for the Terra Nova project on the Grand Banks of
Newfoundland, as well as large orders from Statoil and Shell during the quarter.
Airport Products sales were down slightly, but profits increased on improved
margins. FMC FoodTech sales and profits were down from last year's quarter,
reflecting its weak backlog position at the beginning of the year. Machinery and
Equipment backlog at the end of the first quarter 1998 was $1.4 billion, up 41
percent from $1 billion at year-end 1997, reflecting the large increase in
energy equipment orders.
Industrial Chemicals sales were $237 million, up slightly from the first
quarter 1997. Earnings were $33 million compared with $35 million in last year's
quarter. Soda ash sales and profits were down compared with first quarter 1997,
reflecting expected lower export volumes and prices to Asia. Hydrogen peroxide
sales were lower, and earnings were up slightly, due to improved margins as cost
control efforts offset continuing weak pricing. Phosphorus sales and profits
were up, reflecting higher volumes and lower depreciation.
Performance Chemicals sales were $326 million, up 10 percent from $297
million in the first quarter 1997, and earnings were $34 million, up 15 percent
from $30 million in last year's quarter. Agricultural products sales and profits
were up, primarily due to increased sales of Authority and Command herbicides,
as well as lower costs due to restructuring initiatives. Process changes were
implemented at the Authority herbicide plant in January, and the plant is
currently at targeted production rates. Specialty chemicals sales were down
slightly, while profits rose slightly compared with last year, reflecting
improved food ingredients margins.
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Net interest expense was $25 million, down 18 percent from $30 million last
year, due to lower debt levels. Corporate expenses were $23 million, even with
the previous year's quarter.
During the quarter, the company adopted the provisions of a new accounting
standard, AICPA Statement of Position 98-5, "Reporting on the Costs of Start-up
Activities," which required the after-tax write-off of $36 million of previously
capitalized start-up costs. The impact from this write-off is shown below after-
tax income from continuing operations in the company's income statement. FMC's
resulting net loss after adopting the new accounting principle was $9 million,
or $0.26 per share on a diluted basis, compared with net income for the 1997
first quarter of $40 million or $1.05 per share.
FMC Corporation is one of the world's leading producers of chemicals and
machinery for industry and agriculture. FMC employs approximately 17,000 people
at more than 100 manufacturing facilities and mines in more than 25 countries.
The company divides its businesses into three major segments: Machinery and
Equipment, Industrial Chemicals and Performance Chemicals.
# # #
Safe Harbor Statement under the Private Securities Litigation Act of 1995.
Statements in this news release that are forward-looking statements are subject
to various risks and uncertainties concerning the specific factors identified
above and in the corporation's Form 10-K report and other SEC filings. Such
information contained herein represents management's best judgment as of the
date hereof based on information currently available. The corporation does not
intend to update this information and disclaims any legal liability to the
contrary.
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FMC CORPORATION AND CONSOLIDATED SUBSIDIARIES
---------------------------------------------
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
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(Unaudited and in millions, except per share amounts)
<TABLE>
<CAPTION>
Three Months
Ended March 31
---------------------------------
1998 1997
----------- -----------
<S> <C> <C>
Sales $ 1,022.4 $ 992.9
Other revenue 16.6 9.5
----------- -----------
Total revenue 1,039.0 1,002.4
Total costs and expenses 977.3 942.1
----------- -----------
61.7 60.3
Minority interests 0.9 2.4
Net interest expense 24.6 30.1
----------- -----------
Income from continuing operations
before income taxes and cumulative effect of
change in accounting principle 36.2 27.8
Provision for income taxes 9.4 6.6
----------- -----------
Income from continuing operations before cumulative
effect of change in accounting principle 26.8 21.2
Discontinued operation, net of income taxes - 18.8
Cumulative effect of change in accounting
principle, net of income taxes (36.1) -
----------- -----------
Net income (loss) $ (9.3) $ 40.0
=========== ===========
Basic earnings (loss) per common share:
Continuing operations $ 0.77 $ 0.57
Discontinued operation - 0.50
Cumulative effect of change in accounting
principle (1.04) -
----------- -----------
Net income (loss) per common share $ (0.27) $ 1.07
=========== ===========
Average number of shares used in basic
earnings (loss) per share computations 34.8 37.2
=========== ===========
Diluted earnings (loss) per common share:
Continuing operations $ 0.75 $ 0.56
Discontinued operation - 0.49
Cumulative effect of change in accounting
principle (1.01) -
----------- -----------
Net income (loss) per common share $ (0.26) $ 1.05
=========== ===========
Average number of shares used in diluted
earnings (loss) per share computations 35.8 38.1
=========== ===========
</TABLE>
Note: Prior period amounts have been restated to present the Defense Systems
segment as a discontinued operation.
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FMC CORPORATION AND CONSOLIDATED SUBSIDIARIES
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INDUSTRY SEGMENT DATA
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(Unaudited and in millions)
<TABLE>
<CAPTION>
Three
Months
Ended
March 31
--------------------------
1998 1997
---------- ----------
Sales
- -----
<S> <C> <C>
Machinery and Equipment $ 466.2 $ 467.0
Industrial Chemicals 237.1 235.5
Performance Chemicals 326.4 297.4
Eliminations (7.3) (7.0)
---------- ----------
$ 1,022.4 $ 992.9
========== ==========
Income from continuing operations
- ---------------------------------
before income taxes and cumulative
- ----------------------------------
effect of change in accounting principle
- ----------------------------------------
Machinery and Equipment $ 22.9 $ 16.5
Industrial Chemicals 32.5 35.2
Performance Chemicals 34.4 29.9
---------- ----------
Operating profit from continuing
operations 89.8 81.6
Corporate (23.3) (23.3)
Other income and (expense), net (5.7) (0.4)
Net interest expense (24.6) (30.1)
---------- ----------
Income from continuing operations
before income taxes and cumulative
effect of change in accounting
principle $ 36.2 $ 27.8
========== ==========
</TABLE>
Note: Prior period amounts have been restated to present the Defense Systems
segment as a discontinued operation.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, The
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
FMC CORPORATION
By /s/ J. Paul McGrath
-----------------------------
J. Paul McGrath
Senior vice president, general
counsel and secretary
Date April 16, 1998
