<PAGE>1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended March 31, 1996
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 1-6746
INDIANA BELL TELEPHONE COMPANY, INCORPORATED
(Incorporated under the laws of the State of Indiana)
240 North Meridian Street, Indianapolis, Indiana 46204
I.R.S. Employer Identification Number 35-0407820
Telephone Number - (800) 257-0902
THE REGISTRANT, A WHOLLY OWNED SUBSIDIARY OF AMERITECH CORPORATION,
MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a) AND (b)
OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH REDUCED DISCLOSURE
FORMAT PURSUANT TO GENERAL INSTRUCTION H(2).
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 April 30, 1996, 13,490,876 common shares were outstanding.
<PAGE>2
Part I - Financial Information
------------------------------
The following condensed financial statements have been prepared by
Indiana Bell Telephone Company, Incorporated (the Company) pursuant to
the rules and regulations of the Securities and Exchange Commission
(SEC) and, in the opinion of the Company, include all adjustments
(consisting only of normal recurring adjustments) necessary for a fair
statement of results for each period shown. 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 such SEC rules and
regulations. The Company believes that the disclosures made are
adequate to make the information presented not misleading. These
financial statements should be read in conjunction with the financial
statements and notes thereto included in the Company's latest Annual
Report on Form 10-K.
CONDENSED STATEMENTS OF INCOME AND REINVESTED EARNINGS
(Dollars in Millions)
(Unaudited)
Three Months Ended
March 31
-------------
1996 1995
---- ----
Revenues................................. $ 301.6 $ 291.7
--------- ---------
Operating Expenses
Employee-related expenses.............. 54.4 55.9
Depreciation and amortization.......... 44.1 47.5
Other operating expenses............... 97.6 91.5
Restructuring credit................... -- (36.5)
Taxes other than income taxes.......... 11.4 11.8
--------- ---------
207.5 170.2
--------- ---------
Operating income......................... 94.1 121.5
Interest expense......................... 3.7 4.3
Other income, net........................ 1.0 --
--------- ---------
Income before income taxes............... 91.4 117.2
Income taxes............................. 33.3 43.6
--------- ---------
Net income............................... 58.1 73.6
Reinvested earnings,
beginning of period.................... 66.4 30.2
Less, dividends declared............. 43.5 47.9
--------- ---------
Reinvested earnings,
end of period.......................... $ 81.0 $ 55.9
========= =========
See Notes to Condensed Financial Statements.
<PAGE>3
CONDENSED BALANCE SHEETS
(Dollars in Millions)
Mar. 31, 1996 Dec. 31, 1995
------------- -------------
(Unaudited) (Derived from
Audited
Financial
Statements)
ASSETS
- ------
Current assets
Cash and temporary cash investments......... $ 0.1 $ 0.1
Receivables, net
Customers................................. 207.6 214.9
Ameritech and affiliates.................. 1.1 17.1
Other..................................... 5.0 8.1
Material and supplies....................... 5.1 4.3
Prepaid and other........................... 10.5 11.8
--------- ---------
229.4 256.3
--------- ---------
Property, plant and equipment................ 3,100.1 3,085.0
Less, accumulated depreciation............... 1,912.5 1,892.8
--------- ---------
1,187.6 1,192.2
--------- ---------
Investments, primarily in affiliates......... 35.2 37.5
Other assets and deferred charges............ 82.4 82.2
--------- ---------
Total assets................................. $ 1,534.6 $ 1,568.2
========= =========
See Notes to Condensed Financial Statements.
<PAGE>4
CONDENSED BALANCE SHEETS (continued)
(Dollars in Millions)
Mar. 31, 1996 Dec. 31, 1995
------------- -------------
(Unaudited) (Derived from
Audited
Financial
Statements)
LIABILITIES AND SHAREOWNER'S EQUITY
Current liabilities
Debt maturing within one year
Ameritech............................... $ 139.2 $ 150.6
Other................................... 0.2 0.3
Accounts payable
Ameritech Services, Inc. (ASI).......... 52.1 56.8
Ameritech and affiliates................ 13.2 11.8
Other................................... 65.0 78.3
Other current liabilities................ 151.3 162.5
--------- ---------
421.0 460.3
--------- ---------
Long-term debt............................ 85.7 85.8
--------- ---------
Deferred credits and other long-term liabilities
Accumulated deferred income taxes........ 43.6 46.2
Unamortized investment tax credits....... 20.9 21.8
Postretirement benefits
other than pensions.................... 265.8 269.2
Long-term payable to ASI................. 7.7 8.3
Other.................................... 43.9 45.2
--------- ---------
381.9 390.7
--------- ---------
Shareowner's equity
Common shares - ($40 par value;
15,000,000 shares authorized;
13,490,876 issued and outstanding)..... 539.6 539.6
Proceeds in excess of par value.......... 25.4 25.4
Reinvested earnings....................... 81.0 66.4
--------- ---------
646.0 631.4
--------- ---------
Total liabilities and shareowner's equity.. $ 1,534.6 $ 1,568.2
========= =========
See Notes to Condensed Financial Statements.
<PAGE>5
CONDENSED STATEMENTS OF CASH FLOWS
(Dollars in Millions)
(Unaudited)
Three Months Ended
March 31
-------------
1996 1995
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income.................................... $ 58.1 $ 73.6
Adjustments to net income
Restructuring credit, net of tax............ -- (22.9)
Depreciation and amortization............... 44.1 47.5
Deferred income taxes, net.................. (2.4) (1.7)
Investment tax credits, net................. (0.9) (1.4)
Capitalized interest........................ (0.2) (0.1)
Provision for uncollectibles................ 4.2 3.9
Change in accounts receivable............... 22.2 29.9
Change in material and supplies............. (2.1) (0.5)
Change in certain other current assets...... 1.4 5.5
Change in accounts payable.................. (16.6) (41.1)
Change in certain other current liabilities. 47.3 31.7
Change in certain other noncurrent
assets and liabilities.................... (5.6) (2.9)
Other....................................... 2.0 0.5
-------- --------
Net cash from operating activities............ 151.5 122.0
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures........................... (38.6) (28.0)
Proceeds from disposals of
property, plant and equipment................. 0.8 1.3
-------- --------
Net cash from investing activities............. (37.8) (26.7)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Intercompany financing, net.................... (11.4) (95.6)
Retirements of long-term debt.................. (0.2) (0.2)
Dividend payments.............................. (102.1) --
-------- --------
Net cash from financing activities............. (113.7) (95.8)
-------- --------
Net decrease in cash and
temporary cash investments.................... -- (0.5)
Cash and temporary cash investments,
beginning of period........................... 0.1 0.5
-------- --------
Cash and temporary cash investments,
end of period................................. $ 0.1 $ --
======== ========
See Notes to Condensed Financial Statements.
<PAGE>6
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Dollars in Millions)
MARCH 31, 1996
NOTE 1: Work Force Restructuring
As announced in March 1994, the Company's parent, Ameritech
Corporation, restructured its existing nonmanagement work force,
reducing the work force by 11,500 employees during 1994 and 1995,
including 1,344 at the Company. As a result of the restructuring, the
Company recorded a gain of $36.5 million or $22.9 million after-tax in
the first three months of 1995, resulting primarily from settlement
gains from lump sum pension payments from the Ameritech Pension Plan
to former employees. No restructuring charges or credits were recorded
in the first three months of 1996.
The Company recorded additional restructuring charges in the fourth
quarter of 1995, primarily for the consolidation of data centers and
additional work force reductions.
NOTE 2: Reclassification
Certain reclassifications were made to the December 31, 1995 balances
to correspond to the presentation as of March 31, 1996.
<PAGE>7
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
(Dollars in Millions)
The following is a discussion and analysis of the changes in revenues,
operating expenses and other income and expenses for the first three
months of 1996 as compared with the first three months of 1995.
Results of Operations
- ---------------------
Revenues
- --------
Total revenues in the first three months of 1996 were $301.6 million
and were $291.7 million for the same period in 1995. The following
paragraphs explain the components of that change.
- ----------------------------------------------------------------------
Local service
- -------------
March 31 Increase Percent
----------
(dollars in millions) 1996 1995 (Decrease) Change
------------------- ---- ---- -------- ------
Three Months Ended $ 151.1 $ 137.2 $ 13.9 10.1
The increase in local service revenues for the three months ended
March 31, 1996 was due primarily to volume increases, resulting in
increased revenues of $12.8 million as well as rate increases of $1.1
million. The increased network usage volumes resulted principally
from growth in the number of access lines, which increased 4.8 percent
to 2,044,000 as of March 31, 1996, as compared to 1,950,000 at March
31, 1995, and increased sales of call management services, such as
Call Forwarding and Caller ID.
<PAGE>8
Management's Discussion and Analysis
of Results of Operations (cont'd.)
Network access
- --------------
March 31 Increase Percent
----------
(dollars in millions) 1996 1995 (Decrease) Change
------------------- ---- ---- -------- ------
Interstate
- ----------
Three Months Ended $ 62.7 $ 61.4 $ 1.3 2.1
Intrastate
- ----------
Three Months Ended $ 19.9 $ 21.9 $ (2.0) (9.1)
The increase in interstate network access revenues for the three
months ended March 31, 1996 was due primarily to higher network usage,
which resulted in additional revenues of $5.1 million, partially
offset by price decreases of $3.5 million. Minutes of use related to
interstate calls increased 10.1 percent in the first quarter of 1996
compared to the prior year period.
The decrease in intrastate network access revenues for the three
months ended March 31, 1996 was due primarily to rate decreases of
$3.5 million, partially offset by volume increases due to higher
network usage of $1.5 million. Minutes of use related to intrastate
calls increased 18.0 percent in the first quarter of 1996 compared to
the prior year period.
Long distance service
- ---------------------
March 31 Increase Percent
----------
(dollars in millions) 1996 1995 (Decrease) Change
------------------- ---- ---- -------- ------
Three Months Ended $ 37.0 $ 38.0 $ (1.0) (2.6)
The decrease in long distance service revenues for the three months
ended March 31, 1996 was due primarily to volume reductions of $1.1
million.
- ----------------------------------------------------------------------
Other
- -----
March 31 Increase Percent
----------
(dollars in millions) 1996 1995 (Decrease) Change
------------------- ---- ---- -------- ------
Three Months Ended $ 30.9 $ 33.2 $ (2.3) (6.9)
Other revenues include revenues derived from directory advertising,
billing and collection services, inside wire installation and
maintenance services and other miscellaneous services. The decrease
in other revenues for the three months ended March 31, 1996 is largely
attributable to a decrease in directory advertising revenues due to a
renegotiated listing and directory services agreement with Ameritech
Publishing, Inc. (API), an Ameritech subsidiary doing business as
Ameritech Advertising Services. The renegotiated agreement accounts
for $12.9 million of the decrease. Billing and collection revenues
also decreased by $0.4 million. These decreases were partially offset
by growth in voice messaging, sales of equipment and other
nonregulated services of $8.9 million, as well as increases in inside
wire installation and services revenues of $2.1 million.
<PAGE>9
Management's Discussion and Analysis
of Results of Operations (cont'd.)
Operating expenses
- ------------------
Total operating expenses for the three months ended March 31, 1996
increased $37.3 million, or 21.9 percent to $207.5 million. The
increase was primarily attributable to work force restructuring, which
resulted in a credit of $36.5 million in the first quarter of 1995
related to settlement gains previously discussed.
- ----------------------------------------------------------------------
Employee-related expenses
- -------------------------
March 31 Increase Percent
----------
(dollars in millions) 1996 1995 (Decrease) Change
------------------- ---- ---- -------- ------
Three Months Ended $ 54.4 $ 55.9 $ (1.5) (2.7)
The decrease in employee-related expenses for the three months ended
March 31, 1996 was due primarily to decreases in work force levels and
overtime, resulting in an expense decrease of $2.3 million, partially
offset by wage rate and incentive increases of $1.1 million, as well
as decreases in benefits, payroll taxes and other employee-related
expenses of $2.0 million. These decreases were partially offset by a
decrease of $1.5 million in the pension credit recorded in the first
quarter of 1996 compared to the prior year period.
There were 4,142 employees at March 31, 1996, compared with 4,281 at
March 31, 1995.
- ----------------------------------------------------------------------
Depreciation and
amortization
- ------------------
March 31 Increase Percent
----------
(dollars in millions) 1996 1995 (Decrease) Change
------------------- ---- ---- -------- ------
Three Months Ended $ 44.1 $ 47.5 $ (3.4) (7.2)
The decrease in depreciation and amortization in the three months
ended March 31, 1996 was primarily attributable to two major asset
categories becoming fully depreciated in 1995 requiring no further
depreciation accruals in 1996, which resulted in a decrease of $6.3
million in depreciation expense in the first quarter of 1996. This
decrease was partially offset by depreciation on higher average plant
balances for the other asset categories, as well as the effect of
higher rates in certain asset categories.
<PAGE>10
Management's Discussion and Analysis
of Results of Operations (cont'd.)
Other operating expenses
- ------------------------
March 31 Increase Percent
----------
(dollars in millions) 1996 1995 (Decrease) Change
------------------- ---- ---- -------- ------
Three Months Ended $ 97.6 $ 91.5 $ 6.1 6.7
The increase in other operating expenses for the three months ended
March 31, 1996 was due to cost of sales increases of $5.3 million
related to equipment, an increase of $1.3 million in affiliated
services, and increases in advertising, uncollectibles and other
expenses of $2.4 million, related to increased sales efforts for
equipment and call management services, such as voice messaging and
other nonregulated services. These increases were partially offset by
a decrease in contract and professional services of $2.6 million.
- ----------------------------------------------------------------------
Restructuring credit
- --------------------
March 31 Percent
----------
(dollars in millions) 1996 1995 Change Change
------------------- ---- ---- -------- ------
Three Months Ended $ -- $ (36.5) $ 36.5 (100.0)
As discussed in Note 1, the Company significantly reduced its
nonmanagement work force during 1994 and 1995 by 1,344 employees. New
employees with different skills were added during this period to
accommodate growth and meet staffing requirements for new business
opportunities. As of March 31, 1995, 1,141 employees had left the
Company, with 46 leaving in the first quarter of 1995. A pretax,
noncash settlement gain of $36.5 million was recorded in the first
quarter of 1995, associated with lump-sum pension payments to former
employees. No restructuring charges or credits were recorded in the
first quarter of 1996.
- ----------------------------------------------------------------------
Taxes other than income taxes
- -----------------------------
March 31 Increase Percent
----------
(dollars in millions) 1996 1995 (Decrease) Change
------------------- ---- ---- -------- ------
Three Months Ended $ 11.4 $ 11.8 $ (0.4) (3.4)
The decrease in taxes other than income taxes for the three months
ended March 31, 1996 was due primarily to decreases in property and
gross receipts taxes compared to the prior year period.
<PAGE>11
Management's Discussion and Analysis
of Results of Operations (cont'd.)
Other Income and Expenses
- -------------------------
Interest expense
- -----------------
March 31 Increase Percent
----------
(dollars in millions) 1996 1995 (Decrease) Change
------------------- ---- ---- -------- ------
Three Months Ended $ 3.7 $ 4.3 $ (0.6) (14.0)
The decrease in interest expense for the three months ended March 31,
1996 is due primarily to a decrease in interest on borrowings from the
Ameritech short-term pool.
- ----------------------------------------------------------------------
Other income, net
- -----------------
Change
March 31 Income Percent
----------
(dollars in millions) 1996 1995 (Expense) Change
------------------- ---- ---- -------- ------
Three Months Ended $ 1.0 $ -- $ 1.0 n/a
Other income, net includes equity earnings in affiliates, interest
income and other nonoperating items. The increase in other income,
net in the three months ended March 31, 1996 was due to increased
equity earnings from ASI, as well as a decrease in miscellaneous
nonoperating expenses.
- ----------------------------------------------------------------------
Income taxes
- ------------
March 31 Increase Percent
----------
(dollars in millions) 1996 1995 (Decrease) Change
------------------- ---- ---- -------- ------
Three Months Ended $ 33.3 $ 43.6 $ (10.3) (23.6)
The decrease in income taxes in the three months ended March 31, 1996
as compared to the prior year period was primarily attributable to the
decrease in pretax earnings, related to the revenue and expense items
previously discussed.
- ----------------------------------------------------------------------
Ratio of earnings to fixed charges
- ----------------------------------
The ratio of earnings to fixed charges for the three months ended
March 31 was 20.59 in 1996 and 21.40 in 1995. The ratio in 1996 was
favorably affected by a credit of $36.5 million for work force
restructuring (see prior discussion of this item). The work force
restructuring program has largely been funded by the Ameritech Pension
Plan.
The computations of the ratio of earnings to fixed charges for the
five years ended December 31, 1995 have been restated. The ratio, as
adjusted, for the years ended December 31, 1995, 1994, 1993, 1992 and
1991 was 20.38, 8.45, 8.01, 6.91 and 6.23, respectively. The impact
of the restatement was not significant and was made to be consistent
with unregulated enterprises.
<PAGE>12
Management's Discussion and Analysis
of Results of Operations (cont'd.)
Other Matters
- --------------
Telecommunications Act of 1996
- ------------------------------
The Telecommunications Act of 1996 was signed into law by the
President on February 8, 1996. This legislation defines the
conditions under which Ameritech will be permitted to offer interLATA
long distance service and provides certain mechanisms intended to
facilitate local exchange competition. This legislation, in addition
to allowing Ameritech to offer interLATA long distance services, will
allow competitors into the Company's traditional local exchange
markets. Management believes the legislation gives the Company an
opportunity to expand its revenue base by providing long distance
services, while retaining lower-margin access revenues as other local
service providers, acting as resellers, continue to use Ameritech's
network facilities.
On April 19, 1996 the Federal Communications Commission (FCC) issued a
notice of proposed rulemaking seeking comment on proposed rules
opening local telephone markets to competition. The FCC has until
August 8, 1996 to issue the new rules.
<PAGE>13
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
---------------------------------
(a) Exhibits
--------
12 Computation of Ratio of Earnings to Fixed Charges for
the three months ended March 31, 1996 and March 31,
1995, and for the five years ended December 31, 1995.
27 Financial Data Schedule.
(b) Reports on Form 8-K
-------------------
No Form 8-K was filed by the registrant during the quarter
which this report is filed.
<PAGE>14
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.
INDIANA BELL TELEPHONE COMPANY, INCORPORATED
--------------------------------------------
(Registrant)
Date: May 10, 1996 /s/ Laurie L. Streling
---------------------
Laurie L. Streling
Comptroller
State Finance Organization
(Principal Accounting Officer)
EXHIBIT 12
INDIANA BELL TELEPHONE COMPANY, INCORPORATED
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Dollars in Millions)
Three Months Ended
March 31
-------------
1996 1995
---- ----
1. EARNINGS
a) Income before interest expense,
income taxes and undistributed
equity earnings (2).......... $ 94.0 $ 120.7
b) Portion of rental expense
representative of the
interest factor (1)................. 0.7 1.3
-------- --------
Total 1(a) through 1(b)................. $ 94.7 $ 122.0
-------- --------
2. FIXED CHARGES
a) Total interest expense including
capital lease obligations........... $ 3.7 $ 4.3
b) Capitalized interest................. 0.2 0.1
c) Portion of rental expense
representative of the
interest factor (1)................. 0.7 1.3
-------- --------
Total 2(a) through 2(c)................. $ 4.6 $ 5.7
-------- --------
3. RATIO OF EARNINGS TO FIXED CHARGES....... 20.59 21.40
===== =====
(1) One-third of rental expense is considered to be the amount
representing return on capital.
(2) The results for the first three months of 1995 reflect a $36.5
million pretax credit primarily from settlement gains resulting
form lump sum pension payments from the pension plan to former
employees who left the business in the nonmanagement work force
restructuring.
EXHIBIT 12
INDIANA BELL TELEPHONE COMPANY, INCORPORATED
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Dollars in Millions)
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
1. EARNINGS
a) Income before interest expense, income
tax, extraordinary charge, cumulative
effect of change in accounting
principles and undistributed
equity earnings (2)........... $ 411.5 $ 216.9 $ 293.2 $ 267.2 $ 260.8
b) Portion of rental expense representative
of the interest factor (1).... 2.3 8.7 8.7 4.9 6.0
-------- ------- ------- ------- -------
Total 1(a) through 1(b)... $ 413.8 $ 225.6 $ 301.9 $ 272.1 $ 266.8
======== ======= ======= ======= =======
2. FIXED CHARGES
a) Total interest expense including capital
lease obligations............. $ 17.4 $ 17.3 $ 28.3 $ 34.0 $ 36.1
b) Capitalized interest........... 0.6 0.7 0.7 0.5 0.7
c) Portion of rental expense representative
of the interest factor (1).... 2.3 8.7 8.7 4.9 6.0
------- ------- ------- ------- -------
Total 2(a) through 2(c)... $ 20.3 $ 26.7 $ 37.7 $ 39.4 $ 42.8
======== ======= ======= ======= =======
3. RATIO OF EARNINGS TO FIXED CHARGES 20.38 8.45 8.01 6.91 6.23
======== ======= ======= ======= =======
(1) One-third of rental expense is considered to be the amount
representing return on capital.
(2) The results for 1995 reflect a $36.9 pretax credit primarily from
settlement gains resulting from lump sum pension payments from the
pension plan to former employees who left the business in the
nonmanagement work force restructuring, partially offset by increased
force costs related to the restructuring started in 1994, as well as
write-down of certain data processing equipment to net realizable
value. Results for 1994 reflect a $93.5 pretax charge associated with
the nonmanagement work force restructuring. Costs of the work force
restructuring program have largely been funded from the Ameritech
Pension Plan.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
INDIANA BELL TELEPHONE COMPANY, INCORPORATED'S MARCH 31, 1996 FINANCIAL
STATEMENTS AND IA QUALIFIED IN ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 100
<SECURITIES> 0<F1>
<RECEIVABLES> 223,200
<ALLOWANCES> 9,500
<INVENTORY> 5,100
<CURRENT-ASSETS> 229,400
<PP&E> 3,100,100
<DEPRECIATION> 1,912,500
<TOTAL-ASSETS> 1,534,600
<CURRENT-LIABILITIES> 421,000
<BONDS> 85,700
0
0
<COMMON> 539,600
<OTHER-SE> 106,400
<TOTAL-LIABILITY-AND-EQUITY> 1,534,600
<SALES> 0<F2>
<TOTAL-REVENUES> 301,600
<CGS> 0<F3>
<TOTAL-COSTS> 207,500
<OTHER-EXPENSES> (1,000)
<LOSS-PROVISION> 4,200
<INTEREST-EXPENSE> 3,700
<INCOME-PRETAX> 91,400
<INCOME-TAX> 33,300
<INCOME-CONTINUING> 58,100
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 58,100
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>SECURITIES ARE NOT MATERIAL AND THEREFORE HAVE NOT BEEN STATED SEPARATELY
IN THE FINANCIAL STATEMENTS. THIS AMOUNT IS INCLUDED IN THE CASH TAG.
<F2>NET SALES OF TANGIBLE PRODUCTS IS NOT MORE THAN 10% OF TOTAL OPERATING
REVENUES AND THEREFORE HAS NOT BEEN STATED SEPARATELY IN THE FINANCIAL
STATEMENTS PURSUANT TO REGULATION S-X, RULE 5-03(B). THIS AMOUNT IS
INCLUDED IN THE "TOTAL REVENUES" TAG.
<F3>COST OF TANGIBLE GOODS SOLD IS INCLUDED IN COST OF SERVICE AND PRODUCTS
IN THE FINANCIAL STATEMENTS AND THE "TOTAL COST" TAG, PURSUANT TO
REGULATION S-X, RULE 5-03(B).
</FN>
</TABLE>
