SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One)
/x/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1994
/ / 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 1-4710
WHITMAN CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 36-6076573
- ----------------------------------- -----------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
3501 Algonquin Road, Rolling Meadows, Illinois 60008
- ---------------------------------------------- -------
(Address of principal executive offices) (Zip Code)
Registrant s telephone number, including area code (708) 818-5000
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 October 31, 1994, the Registrant had 105,474,202 outstanding shares
(excluding treasury shares) of common stock, no par value, the Registrant s
only class of common stock.
CONTENTS
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Statements of Income
Condensed Consolidated Balance Sheets
Condensed Consolidated Statements of Cash Flows
Notes to Condensed Consolidated Financial Statements
Item 2. Management s Discussion and Analysis of Financial
Condition and Results of Operations
PART II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
SIGNATURE
EXHIBIT 12 - STATEMENT OF CALCULATION OF RATIO OF EARNINGS TO FIXED CHARGES
EXHIBIT 27 - FINANCIAL DATA SCHEDULE
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Quarter Ended Nine Months Ended
September 30, September 30,
---------------- ----------------
1994 1993 1994 1993
-------- -------- -------- --------
(in millions, except per-share data)
Sales and Revenues $ 741.3 $ 703.7 $ 1,961.7 $ 1,860.9
Cost of Goods Sold 472.0 448.2 1,250.7 1,188.7
-------- -------- -------- --------
Gross Profit 269.3 255.5 711.0 672.2
Selling, General and
Administrative Expenses 156.5 146.4 452.8 432.6
Amortization Expense 4.4 4.3 13.1 12.8
-------- -------- -------- --------
Operating Income 108.4 104.8 245.1 226.8
Interest Expense (16.7) (25.4) (53.5) (74.6)
Interest Income 1.5 3.3 4.8 9.0
Other Expense, Net (5.3) (3.9) (16.8) (7.5)
Unrealized Investment Loss (24.2) -- (24.2) --
-------- -------- -------- --------
Income Before Income Taxes 63.7 78.8 155.4 153.7
Income Tax Provision 28.1 33.6 66.6 64.8
Income Before Minority Interest,-------- -------- -------- --------
Extraordinary Loss and Cumulative
Effect of Accounting Change 35.6 45.2 88.8 88.9
Minority Interest 6.6 5.4 14.2 11.6
-------- -------- -------- --------
Income Before Extraordinary Loss
and Cumulative Effect of
Accounting Change 29.0 39.8 74.6 77.3
Extraordinary Loss on Early Debt
Retirement after Taxes -- (4.2) -- (4.2)
Cumulative Effect of Accounting
Change -- -- -- (24.0)
-------- -------- -------- --------
Net Income $ 29.0 $ 35.6 $ 74.6 $ 49.1
======== ======== ======== ========
Average Number of Common Shares
Outstanding 106.3 107.5 106.2 107.5
======== ======== ======== ========
Income (Loss) per Common Share:
Before Extraordinary Loss and
Cumulative Effect of Accounting
Change $ 0.27 $ 0.37 $ 0.70 $ 0.72
Extraordinary Loss on Early
Debt Retirement -- (0.04) -- (0.04)
Cumulative Effect of Accounting
Change -- -- -- (0.22)
-------- -------- -------- --------
Net Income $ 0.27 $ 0.33 $ 0.70 $ 0.46
======== ======== ======== ========
Cash Dividends per Common Share $ 0.085 $ 0.075 $ 0.245 $ 0.215
======== ======== ======== ========
See accompanying notes to condensed consolidated financial statements.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
September 30, December 31,
1994 1993
------------ ------------
(in millions)
ASSETS:
Current Assets:
Cash and Cash Equivalents $ 77.5 $ 93.0
Receivables 338.2 324.1
Inventories 245.3 222.7
Other Current Assets 50.9 51.4
-------- --------
Total Current Assets 711.9 691.2
-------- --------
Investments 208.7 238.5
Property (at Cost) 1,166.2 1,106.9
Accumulated Depreciation and Amortization (576.1) (534.1)
-------- --------
Net Property 590.1 572.8
-------- --------
Intangible Assets 532.2 525.9
Other Assets 80.8 74.8
-------- --------
Total Assets $2,123.7 $2,103.2
======== ========
LIABILITIES AND SHAREHOLDERS EQUITY:
Current Liabilities:
Short-Term Debt, Including Current Portion
of Long-Term Debt $ 90.0 $ 90.0
Accounts and Dividends Payable 238.1 232.9
Other Current Liabilities 146.0 149.8
-------- --------
Total Current Liabilities 474.1 472.7
-------- --------
Long-Term Debt 735.1 749.3
Deferred Income Taxes 41.5 66.6
Other Liabilities 131.8 124.7
Minority Interest 203.2 172.9
Shareholders Equity:
Common Stock (No par, 250.0 million
shares authorized; 105.5 million
shares outstanding at September 30,
1994 and 107.1 million shares
outstanding at December 31, 1993) 409.9 404.4
Retained Income 221.9 172.4
Cumulative Translation Adjustment (51.2) (52.3)
Treasury Common Stock (42.6) (7.5)
-------- --------
Total Shareholders Equity 538.0 517.0
-------- --------
Total Liabilities and Shareholders
Equity $2,123.7 $2,103.2
======== ========
See accompanying notes to condensed consolidated financial statements.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
September 30,
1994 1993
-------- --------
(in millions)
Cash Flows from Operating Activities:
Income Before Extraordinary Loss and Cumulative Effect
of Accounting Change $ 74.6 $ 77.3
Adjustments to Reconcile to Net Cash Provided by
Operating Activities:
Depreciation and Amortization 74.0 72.3
Unrealized Investment Loss 24.2 --
Other 16.3 20.9
Changes in Assets and Liabilities, Net of
Acquisitions and Dispositions:
Increase in Receivables (12.8) (57.9)
Increase in Inventories (22.0) (5.2)
Increase in Payables 5.0 51.6
Net Change in Other Assets and Liabilities (25.7) 9.0
------- -------
Net Cash Provided by Continuing Operations 133.6 168.0
Net Cash Used in Discontinued Operations (2.4) (25.6)
------- -------
Net Cash Provided by Operating Activities 131.2 142.4
------- -------
Cash Flows from Investing Activities:
Capital Investments, Net (76.4) (53.5)
Decrease (Increase) in Investments 3.6 (149.1)
------- -------
Net Cash Used in Investing Activities (72.8) (202.6)
------- -------
Cash Flows from Financing Activities:
Proceeds from Issuance of Long-Term Debt 186.4 263.2
Repayment of Long-Term Debt (168.4) (133.2)
Net Repayment of Bank Lines of Credit and Commercial
Paper (36.1) --
Increase in Current Debt -- 0.1
Common Dividends (25.9) (23.0)
Treasury Stock Purchases (35.1) (3.2)
Issuance of Common Stock 5.6 1.6
------- -------
Net Cash Provided by (Used in) Financing Activities (73.5) 105.5
------- -------
Effect of Exchange Rate Changes on Cash and Cash
Equivalents (0.4) (0.7)
------- -------
Change in Cash and Cash Equivalents (15.5) 44.6
Cash and Cash Equivalents at January 1 93.0 132.5
------- -------
Cash and Cash Equivalents at September 30 $ 77.5 $ 177.1
======= =======
See accompanying notes to condensed consolidated financial statements.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. The condensed consolidated financial statements included herein have
been prepared by the Registrant, without audit. Certain information
and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to the rules and regulations
of the Securities and Exchange Commission, although the Registrant
believes that the disclosures made are adequate to make the
information presented not misleading. It is suggested that these
condensed consolidated financial statements be read in conjunction
with the financial statements and notes thereto included in the
Registrant s Annual Report to Shareholders incorporated by reference
in its Annual Report on Form 10-K for the year ended December 31,
1993. In the opinion of management, the information furnished herein
reflects all adjustments (consisting only of normal recurring
adjustments) necessary for a fair statement of results for the interim
periods presented.
2. At September 30, 1994, investments included common stock held in
Northfield Laboratories Inc. ("Northfield") having an original cost of
$37.4 million. During May and June, 1994, Northfield had an initial
public offering of 2,875,000 shares of common stock. Prior to the
offering, there had been no public market for Northfield's common
stock. As a result of the continuing low market valuation of the
Registrant's investment in Northfield, and in accordance with
Statement of Financial Accounting Standards No. 115, "Accounting for
Certain Investments in Debt and Equity Securities", the Registrant has
adjusted its investment in Northfield to reflect the current market
value. The market value of these securities based upon quoted market
prices was lower than cost by $24.2 million at September 30, 1994.
This unrealized loss on the Northfield investment, after reflecting
tax benefits of $8.7 million, resulted in a non-cash charge to income
of $15.5 million, or $0.15 per share, in the third quarter and nine
months ended September 30, 1994.
3. During the first quarter of 1994, the Registrant s subsidiary, Pepsi
General, acquired a Pepsi-Cola franchise in Waterloo, Iowa, from
Midland Bottling Co. ("Midland Bottling"), a subsidiary of PepsiCo,
Inc. The acquisition was made through a tax-free merger in which
Pepsi General issued 2,025 shares of its Preferred Stock, Series A, to
Midland Bottling. The effects of this acquisition, had it been
acquired on January 1, 1994, would not have been significant to
operating results.
4. In September, 1993, the Registrant redeemed the entire issue of $95.8
million 7-1/4% split currency bonds (effective interest rate of 12.6%)
originally due in September, 1997 for $101.9 million. After related
expenses and fees, this early debt retirement resulted in an after tax
loss of $4.2 million or $0.04 per share. This loss is reported
separately as an Extraordinary Loss in the Registrant s Condensed
Consolidated Statements of Income. The funds for redemption were
provided by seven to twelve year notes issued during 1993 with
effective interest rates ranging from 5.8% to 6.9%.
5. In the first quarter of 1993, the Registrant adopted Statement of
Financial Accounting Standards No. 106, which among other items,
required the Registrant to reflect estimates of future costs of
medical and survivor benefits for certain retirees in its financial
statements. Previously, the costs of the Registrant s retiree medical
and survivor benefit programs were recognized in the financial
statements on a cash accounting basis. The cumulative effect of
adopting this change in accounting principle as of January 1, 1993
resulted in a non-cash pretax charge of $38.7 million ($24.0 million
after-tax, or $0.22 per share) and is reported as a separate component
in the Registrant s Condensed Consolidated Statements of Income. The
effect of Statement No. 106 on annual postretirement benefit expense,
compared with the previous accounting method, is not significant.
6. Effective January 1, 1993, the Registrant adopted Statement of
Financial Accounting Standards No. 109, "Accounting for Income Taxes".
Statement No. 109 supersedes existing accounting standards for income
taxes including Statement No. 96 which the Registrant adopted in 1988.
Adoption of Statement No. 109 did not result in any cumulative
adjustment and did not have any significant effect on the Registrant s
financial statements or results of operations due to the Registrant s
use of the liability method previously adopted under Statement 96.
7. Net cash provided by operating activities reflected cash payments for
interest and income taxes as follows:
Nine Months Ended
September 30,
------------------
1994 1993
-------- --------
(in millions)
Interest Paid $ 49.8 $ 47.9
Interest Received 4.9 9.2
Income Taxes Paid 72.9 46.7
8. As of September 30, 1994, the components of inventory were
approximately: raw materials and supplies -- 30.8 percent; work in
process -- 18.1 percent; and finished goods -- 51.1 percent.
Item 2. Management s Discussion and Analysis of Financial Condition and
Results of Operations.
LIQUIDITY AND CAPITAL RESOURCES
At September 30, 1994, the Registrant had cash and cash equivalents of
$77.5 million compared with $93.0 million at December 31, 1993. The
reduction in cash during the first nine months of 1994 principally resulted
from capital investments, net debt retirement, purchase of treasury stock
and dividends, partially offset by cash from operations.
In the first nine months of 1994, the registrant issued debt totaling
$186.4 million, principally consisting of twelve year notes and seven year
notes with interest rates of 6.5 percent and 7.5 percent, respectively. In
addition, the Registrant decreased borrowings under bank lines of credit
and commercial paper by $36.1 million. The proceeds from the issuance of
debt was used primarily to repay long-term debt totaling $168.4 million.
In total, the Registrant's debt decreased $14.2 million from December 31,
1993 to $825.1 million at September 30, 1994.
Cash provided from operations amounted to $131.2 million in the first
nine months of 1994, compared with $142.4 million in the first nine months
of 1993. The decrease of $11.2 million principally resulted from higher
tax payments, higher payable disbursements and higher inventory levels,
partially offset by higher receivable collections and higher income,
exclusive of the non-cash unrealized investment loss. Cash provided from
operations, together with existing cash balances, was used principally for
capital investments, dividends, treasury stock purchases and net debt
retirements.
The Registrant had contractual lines of credit of $300.0 million at
September 30, 1994, up $50.0 million from December 31, 1993. The
registrant also maintains a $200 million commercial paper program, up $100
million from December 31, 1993. There were borrowings under these programs
of $47.5 million and $83.6 million at September 30, 1994 and December 31,
1993, respectively.
At December 31, 1993, the registrant had interest rate swap agreements
totaling $65.0 million notional principal on which the Registrant paid
fixed interest and received variable interest. These interest rate swap
agreements all expired during 1994. During 1994, the registrant entered
into new interest rate swap agreements totaling $40.0 million in notional
principal on which the Registrant pays a LIBOR-based floating rate
and receives a fixed rate. These swaps mature in February, 1997 and relate
to the $100.0 million, 6-1/2% term notes due in 2006. The effect of the
Registrant's interest rate and foreign currency swaps (separately and
combined) on interest expense was not significant.
RESULTS OF OPERATIONS
1994 THIRD QUARTER COMPARED WITH 1993 THIRD QUARTER
Sales and revenues increased 5.3 percent to $741.3 million in the
third quarter of 1994 with revenue increases being reported by each of the
Registrant's three major subsidiaries. Sales for the Registrant's three
major subsidiaries are summarized below:
Quarter Ended
September 30,
---------------- %
1994 1993 Change
------ ------ ------
(in millions)
Pepsi General $ 353.7 $ 337.4 4.8
Midas 154.5 141.4 9.3
Hussmann 233.1 224.9 3.6
------- -------
Total Sales and Revenues $ 741.3 $ 703.7 5.3
======= =======
Pepsi General's revenues increased by $16.3 million, principally
reflecting the benefits of improved product demand. Case volume was 4.8
percent higher in the third quarter of 1994 compared with the third quarter
of 1993. Midas revenues increased by $13.1 million, principally due to
higher retail sales in the United States. Hussmann's revenues increased
$8.2 million mainly due to significantly higher sales volume in the United
Kingdom.
Gross profit increased 5.4 percent to $269.3 million, primarily due to
the increase in sales. Gross profit margins remained unchanged from the
third quarter of 1993 at 36.3 percent, generally resulting from higher
margins at Pepsi General and Midas, which reflected the benefits of higher
sales, offset by lower margins at Hussmann, reflecting increasing
competitive pricing pressures and a change in product selling mix
principally in the U.S. and Mexico.
Selling, general and administrative expenses increased $10.1 million,
or 6.9 percent. As a percent of sales, S,G&A expenses represented 21.1
percent, up 0.3 percentage points from last year. A contributing factor to
the increased expenses were higher distribution costs at Pepsi General,
which reflected, among other factors, higher volume, economics, and an
increasing number of SKU's. Changes in amortization expense were not
significant.
Operating income increased $3.6 million, or 3.4 percent, to $108.4
million with higher earnings being reported by Pepsi General and Midas
partially offset by lower earnings at Hussmann. Operating income for the
Registrant's major subsidiaries for the third quarter of 1994 compared with
1993 is summarized below:
Quarter Ended
September 30,
---------------- %
1994 1993 Change
------ ------ ------
(in millions)
Pepsi General $ 59.2 $ 56.5 4.8
Midas 28.0 24.6 13.8
Hussmann 25.0 27.5 (9.1)
------- -------
Subsidiary Operating Income 112.2 108.6 3.3
Corporate Administrative Expenses (3.8) (3.8) NC
------- -------
Total Operating Income $ 108.4 $ 104.8 3.4
======= =======
In the third quarter, Pepsi General had record operating earnings,
primarily reflecting the benefits of higher volume. Midas operating
earnings increased $3.4 million, or 13.8 percent, principally reflecting
improved retail sales in both the United States and Europe. Hussmann
earnings decreased $2.5 million to $25.0 million, primarily due to the
increasing competitive pressures and a change in product selling mix.
Net interest expense declined by $6.9 million as a result of the
Registrant's debt refinancing program. During the past 21 months, the
Registrant has repaid $599.2 million of debt from cash provided by
operations, bank borrowings under bank lines and commercial paper programs,
and proceeds from $449.7 million of debt issued during that period which
has an average interest cost of more than 300 basis points below the
effective interest rate on the debt which the refinancings replaced.
During the third quarter of 1994,the Registrant adjusted its
investment in Northfield to reflect current market value. The market value
of the Registrant's Northfield investment, based upon quoted market prices,
was lower than cost by $24.2 million at September 30, 1994. This loss is
reported separately as an Unrealized Investment Loss in the Registrant's
Condensed Consolidated Statements of Income. This unrealized loss on the
Northfield investment, after reflecting tax benefits of $8.7 million,
resulted in a non-cash charge to income of $15.5 million, or $0.15 per
share, in the third quarter and nine months ended September 30, 1994.
Other Expense increased $1.4 million to $5.3 million in the third
quarter of 1994 compared with 1993 primarily due to a variance in gains and
losses from asset sales.
RESULTS OF OPERATIONS
1994 FIRST NINE MONTHS COMPARED WITH 1993 FIRST NINE MONTHS
Sales and revenues increased 5.4 percent to $1,961.7 million in the
first nine months of 1994 with revenue increases being reported by each of
the Registrant's three major subsidiaries. Sales for the Registrant's
three major subsidiaries for the first nine months of 1994 compared with
1993 are summarized below:
Nine Months Ended
September 30,
---------------- %
1994 1993 Change
------ ------ ------
(in millions)
Pepsi General $ 952.5 $ 892.3 6.7
Midas 411.0 384.8 6.8
Hussmann 598.2 583.8 2.5
-------- --------
Total Sales and Revenues $1,961.7 $1,860.9 5.4
======== ========
Pepsi General's revenues increased by $60.2 million, or 6.7 percent,
reflecting the benefits of higher volume and selling prices. Case volume
increased 5.6 percent in the first nine months of 1994 compared with the
corresponding period of 1993. Midas revenues increased $26.2 million, or
6.8 percent, principally due to higher retail sales throughout the United
States. Hussmann's revenues increased $14.4 million, or 2.5 percent
mainly due to stronger sales volume in Mexico and the United Kingdom,
partially offset by weaker sales in the United States. Demand for
supermarket equipment in the U.S., which was unusually strong in 1993,
returned to more normalized levels in 1994.
Gross profit increased 5.8 percent to $711.0 million, primarily due to
the increase in sales. Gross profit margins improved by 0.1 percentage
points to 36.2 percent compared with the first nine months of 1993,
generally reflecting the benefits of both higher sales volume and higher
selling prices at Pepsi General and Midas, partially offset by lower
margins at Hussmann, reflecting competitive pricing pressures and a change
in product selling mix.
Selling, general and administrative expenses increased $20.2 million,
or 4.7 percent. As a percent of sales, S, G & A expenses represented 23.1
percent, down 0.1 percentage points from last year's 23.2 percent.
Changes in amortization expense were not significant.
Operating income increased by $18.1 million, or 8.1 percent with
higher earnings being reported by Pepsi General and Midas, offset by
slightly lower earnings at Hussmann. Operating income for the Registrant's
major subsidiaries for the first nine months of 1994 compared with 1993 is
summarized below:
Nine Months Ended
September 30,
------------------ %
1994 1993 Change
-------- -------- --------
(in millions)
Pepsi General $ 143.7 $ 129.3 11.1
Midas 61.7 56.5 9.2
Hussmann 51.8 52.2 (0.8)
-------- --------
Subsidiary Operating Income 257.2 238.0 8.1
Corporate Administrative Expenses (12.1) (11.2) 8.1
-------- --------
Total Operating Income $ 245.1 $ 26.8 8.1
======== ========
In the first nine months of 1994, Pepsi General's operating income
increased $14.4 million, or 11.1 percent, primarily reflecting the benefits
of higher volume and selling prices. Midas' operating earnings were up
$5.2 million, or 9.2 percent to $61.7 million, primarily reflecting the
benefits of higher retail sales throughout the United States and the impact
of its new sales and marketing programs. Hussmann's operating earnings of
$51.8 million were down 0.8 percent from 1993's record of $52.2 million,
principally reflecting the effects of competitive pricing pressures and
change in product selling mix.
Net interest expense declined by $16.9 million as a result of the
Registrant's debt refinancing program. During the past 21 months, the
Registrant repaid $599.2 million of debt from cash provided by operations,
bank borrowings under bank lines and commercial paper programs, and
proceeds from $449.7 million of debt issued during that period which has an
average interest cost of more than 300 basis points below the effective
interest rate on the debt which the refinancings replaced.
Other expense increased $9.3 million to $16.8 million for the first
nine months of 1994. The increase principally reflected a variance in
gains and losses from asset sales.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
12. Statement of Calculation of Ratio of Earnings to Fixed Charges.
(b) Reports on Form 8-K.
None filed during the third quarter ended September 30, 1994.
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.
WHITMAN CORPORATION
Date: November 14, 1994 By: /s/ FRANK T. WESTOVER
----------------- ------------------------------
Frank T. Westover
Senior Vice President and
Controller
(As Chief Accounting Officer
and Duly Authorized Officer of
Whitman Corporation)
EXHIBIT 12
WHITMAN CORPORATION
STATEMENT OF CALCULATION
OF RATIO OF EARNINGS TO FIXED CHARGES
(in Millions, Except Ratios)
Nine Months
Ended
September 30, Years Ended December 31,
------------- ------------------------------------
1994 1993 1993 1992 1991 1990 1989
------ ------ ------ ------ ------ ------ ------
Earnings:
Income from Continuing
Operations before
Taxes $155.4 $153.7 $212.2 $170.6 $161.7 $(39.0 $146.8
Fixed Charges Excluding
Capitalized Interest 61.2 81.5 105.9 106.9 138.2 168.1 166.1
------ ------ ------ ------ ------ ------ ------
Income as Adjusted $216.5 $235.2 $318.1 $277.5 $299.9 $129.1 $312.9
====== ====== ====== ====== ====== ====== ======
Fixed Charges:
Interest Expense $ 53.5 $ 74.6 $ 96.2 $ 97.7 $128.6 $158.7 $156.2
Portion of Rents
Representative of
Interest Factor 7.6 6.9 9.7 9.2 9.6 9.4 9.9
------ ------ ------ ------ ------ ------ ------
Fixed Charges Excluding
Capitalize Interest 61.1 81.5 105.9 106.9 138.2 168.1 166.1
Capitalized Interest 0.1 0.2 0.2 0.2 0.2 0.3 0.3
------ ------ ------ ------ ------ ------ ------
Total Fixed Charges $ 61.2 $ 81.7 $106.1 $107.1 $138.4 $168.4 $166.4
====== ====== ====== ====== ====== ====== ======
Ratio of Earnings to
Fixed Charges 3.5x 2.9x 3.0x 2.6x 2.2x 0.8x 1.9x
====== ====== ====== ====== ====== ====== ======
(1)
(1) In 1990, the ratio of earnings to fixed charges was less than
one to one coverage principally as a result of a $170 million
restructuring charge. The dollar amount of fixed charge coverage
deficiency in 1990 was $39.3 million. Excluding the restructuring
charge, the ratio of earnings to fixed charges was 1.8 times in 1990.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> SEP-30-1994
<CASH> 77,500
<SECURITIES> 0
<RECEIVABLES> 338,200
<ALLOWANCES> 0
<INVENTORY> 245,300
<CURRENT-ASSETS> 711,900
<PP&E> 1,166,200
<DEPRECIATION> 576,100
<TOTAL-ASSETS> 2,123,700
<CURRENT-LIABILITIES> 474,100
<BONDS> 735,100
<COMMON> 409,900
0
0
<OTHER-SE> 128,100
<TOTAL-LIABILITY-AND-EQUITY> 2,123,700
<SALES> 1,961,700
<TOTAL-REVENUES> 1,961,700
<CGS> 1,250,700
<TOTAL-COSTS> 1,716,600
<OTHER-EXPENSES> 41,000<F1>
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 48,700<F2>
<INCOME-PRETAX> 155,400
<INCOME-TAX> 66,600
<INCOME-CONTINUING> 74,600<F3>
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 74,600
<EPS-PRIMARY> 0.70
<EPS-DILUTED> 0.70
<FN>
<F1>Includes unrealized loss on investment in Northfield Laboratories of $24,200.
<F2>Interest expense reported is offset by $4,800 of interest income, therefore
gross interest expense equals $53,500.
<F3>Income from continuing operations is reported after minority interest of
$14,200.
</FN>
</TABLE>
