Filed Pursuant to Rule
424(b)(3) of the Rules and
Regulations Under the
Securities Act of 1933
Registration Statement Nos.
33-23826, 33-43448, 33-51876
and 33-51557
PROSPECTUS SUPPLEMENT
(To Prospectus dated July 6, 1994)
FORT HOWARD CORPORATION
12-5/8% Subordinated Debentures Due 2000
14-1/8% Junior Subordinated Discount Debentures Due 2004
9-1/4% Senior Notes Due 2001
10% Subordinated Notes Due 2003
8-1/4% Senior Notes Due 2002
9% Senior Subordinated Notes Due 2006
1991 Pass Through Trust, Pass Through Certificates, Series 1991
- - - - - - - - - - - - - - -
RECENT DEVELOPMENTS
Attached hereto and incorporated by reference herein is the news release
announcing Fort Howard Corporation's financial results for the quarter ended
June 30, 1994.
- - - - - - - - - - - - - - -
This Prospectus Supplement, together with the Prospectus, is to be used
by Morgan Stanley & Co. in connection with offers and sales of the
above-referenced securities in market-making transactions at negotiated prices
related to prevailing market prices at the time of sale. Morgan Stanley & Co.
Incorporated may act as principal or agent in such transactions.
July 26, 1994
<PAGE>
For the second quarter, Fort Howard's net sales increased 4.3% to
$315,299,000 compared to second quarter 1993 net sales of $302,343,000. The
increase is principally due to higher domestic net selling prices. First half
1994 net sales were $590,629,000, an increase of 0.6% over 1993 net sales of
$587,157,000 for the same period.
Operating income increased 28.8% for the second quarter of 1994 to
$78,889,000 compared to $61,253,000 for the second quarter of 1993. Operating
income increased 18.6% to $139,022,000 in the first six months of 1994
compared to $117,212,000 for the first six months of 1993. Operating income
for the second quarter and first six months of 1994 benefited from the
elimination of amortization of goodwill of $14 million and $28 million,
respectively, as a result of the company's goodwill write-off in the third
quarter of 1993. Excluding the amortization of goodwill from 1993 results,
operating income for the second quarter of 1994 increased 4.6% compared to the
second quarter of 1993. For the first six months of 1994, excluding the
amortization of goodwill from 1993 results, operating income decreased 4.5%
compared to the first six months of 1993.
For the second quarter of 1994, earnings before depreciation, interest,
amortization and taxes ("EBDIAT") increased 5.6% to $102,570,000 from
$97,173,000 in the second quarter of 1993. For the first six months of 1994,
EBDIAT decreased 1.6% to $184,801,000 from $187,716,000 in the first six
months of 1993.
As previously announced, on February 2, 1994, the company sold
$100 million principal amount of 8 1/4% Senior Notes due 2002 and $650 million
principal amount of 9% Senior Subordinated Notes due 2006 in a registered
public offering. The proceeds from the sale of the 8 1/4% Senior Notes and
the 9% Senior Subordinated Notes have been principally used to prepay
$100 million of the company's term loan indebtedness under its Bank Credit
Agreement on February 10, 1994 and to repurchase all the company's remaining
12 3/8% Senior Subordinated Notes and $238 million of its 12 5/8% Subordinated
Debentures on March 11, 1994.
Extraordinary losses related to debt repurchases in 1994 and 1993 (See
Note to Financial Information) impacted the company's financial performance in
the first six months of 1994 and 1993.
The net loss for the second quarter and first six months of 1994
decreased to $2,049,000 and $45,391,000, from $23,813,000 and $59,788,000 for
the same periods in 1993, respectively.
(Financial information and note follow on separate pages. The note is an
integral part of this statement.)
#####
<PAGE>
FORT HOWARD CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
Three Months Ended Six Months Ended
June 30 June 30
------------------ ----------------
1994 1993 1994 1993
---- ---- ---- ----
(In thousands)
Net Sales $315,299 $302,343 $590,629 $587,157
Operating Income 78,889 61,253 139,022 117,212
Interest Expense 83,035 87,702 167,353 174,312
Other Expense (Income), Net (286) 249 302 (4)
-------- -------- -------- --------
Loss Before Taxes (3,860) (26,698) (28,633) (57,096)
Income Taxes (Credit) (1,811) (2,885) (11,412) (7,068)
-------- -------- -------- --------
Loss Before Extraordinary Item (2,049) (23,813) (17,221) (50,028)
Extraordinary Item -- Loss on
Debt Repurchases, Net -- -- (28,170) (9,760)
-------- -------- -------- --------
Net Loss $ (2,049) $(23,813) $(45,391) $(59,788)
======== ========= ======== ========
*****
FORT HOWARD CORPORATION
NOTE TO FINANCIAL INFORMATION
1. In the first six months of 1994, the company reported an extraordinary
loss of $28 million (net of income taxes of $15 million) representing the
redemption premiums and write-offs of deferred loan costs associated with
the repayment of $100 million of term loan indebtedness under the
company's Bank Credit Agreement on February 10, 1994 and the repurchases
of all the company's remaining 12 3/8% Senior Subordinated Notes and
$238 million of the company's 12 5/8% Subordinated Debentures on
March 11, 1994. In the first six months of 1993, the company reported an
extraordinary loss of $10 million (net of income taxes of $6 million)
representing the write-off of deferred loan costs associated with the
repayment of $250 million of term loan indebtedness under the company's
Bank Credit Agreement on March 23, 1993 and the repurchases of all the
company's Junior Subordinated Debentures on April 21, 1993.
#####
