SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OF
THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended June 30, 2000 Commission file number 1-4858
-------------------------------------------------------------
INTERNATIONAL FLAVORS & FRAGRANCES INC.
---------------------------------------
(Exact Name of Registrant as specified in its charter)
New York 13-1432060
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(State or other jurisdiction of incorporation (IRS Employer
or organization) identification No.)
521 West 57th Street, New York, N.Y. 10019-2960
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 765-5500
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Sections 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding twelve 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
------------ ------------
Number of shares outstanding as of August 4, 2000: 99,891,344
<PAGE>
PART I. FINANCIAL INFORMATION 1
ITEM 1. FINANCIAL STATEMENTS
INTERNATIONAL FLAVORS & FRAGRANCES INC.
CONSOLIDATED BALANCE SHEET
(DOLLARS IN THOUSANDS)
6/30/00 12/31/99
------------ ------------
(Unaudited)
Assets
Current Assets:
Cash & Cash Equivalents ..................... $ 52,403 $ 62,135
Short-term Investments ...................... 983 836
Trade Receivables ........................... 334,870 290,118
Allowance For Doubtful Accounts ............. (10,393) (10,013)
Inventories: Raw Materials ................. 211,291 229,896
Work in Process ............... 8,652 7,423
Finished Goods ................ 150,500 177,950
------------ ------------
Total Inventories ....... 370,443 415,269
Other Current Assets ........................ 80,481 77,069
------------ ------------
Total Current Assets ........................ 828,787 835,414
------------ ------------
Property, Plant & Equipment, At Cost ........... 960,232 948,920
Accumulated Depreciation ....................... (439,679) (425,004)
------------ ------------
520,553 523,916
Other Assets ................................... 35,247 42,165
------------ ------------
Total Assets ................................... $ 1,384,587 $ 1,401,495
============ ============
Liabilities and Shareholders' Equity
Current Liabilities:
Bank Loans .................................. $ 44,157 $ 29,274
Commercial Paper ............................ 144,287 63,200
Accounts Payable-Trade ...................... 55,982 71,989
Dividends Payable ........................... 38,630 39,882
Income Taxes ................................ 62,068 54,497
Other Current Liabilities ................... 117,536 110,860
------------ ------------
Total Current Liabilities ................... 462,660 369,702
------------ ------------
Other Liabilities:
Deferred Income Taxes ....................... 29,622 32,785
Long-term Debt .............................. 17,002 3,832
Retirement and Other Liabilities ............ 141,019 136,679
------------ ------------
Total Other Liabilities ........................ 187,643 173,296
------------ ------------
Shareholders' Equity:
Common Stock (115,761,840 shares issued) .... 14,470 14,470
Capital in Excess of Par Value .............. 133,113 134,480
Retained Earnings ........................... 1,226,699 1,211,790
Accumulated Other Comprehensive Income:
Cumulative Translation Adjustment ........ (72,363) (57,135)
------------ ------------
1,301,919 1,303,605
Treasury Stock, at cost - 14,810,496
shares in '00 and 10,939,915 in '99 ...... (567,635) (445,108)
------------ ------------
Total Shareholders' Equity .................. 734,284 858,497
------------ ------------
Total Liabilities and Shareholders' Equity ..... $ 1,384,587 $ 1,401,495
============ ============
See Notes to Consolidated Financial Statements
<PAGE>
2
INTERNATIONAL FLAVORS & FRAGRANCES INC.
CONSOLIDATED STATEMENT OF INCOME
(AMOUNTS IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
(Unaudited)
3 Months Ended 6/30
------------------------
2000 1999
--------- ---------
Net Sales $ 368,759 $ 371,079
--------- ---------
Cost of Goods Sold ................................. 199,292 205,210
Research and Development Expenses .................. 26,945 25,943
Selling and Administrative Expenses ................ 66,024 64,214
Nonrecurring Charges ............................... -- 28,758
Interest Expense ................................... 3,074 1,208
Other (Income) Expense, Net ........................ 203 4,599
--------- ---------
295,538 329,932
--------- ---------
Income Before Taxes on Income ...................... 73,221 41,147
Taxes on Income .................................... 24,305 13,713
--------- ---------
Net Income ......................................... 48,916 27,434
Other Comprehensive Income:
Foreign Currency Translation Adjustments ........ (186) (17,304)
--------- ---------
Comprehensive Income ............................... $ 48,730 $ 10,130
========= =========
Net Income Per Share - Basic ....................... $0.48 $0.26
Net Income Per Share - Diluted ..................... $0.48 $0.26
Average Number of Shares Outstanding - Basic ....... 102,359 105,928
Average Number of Shares Outstanding - Diluted ..... 102,387 106,127
Dividends Paid Per Share ........................... $0.38 $0.38
6 Months Ended 6/30
------------------------
2000 1999
--------- ---------
Net Sales .......................................... $ 738,671 $ 738,844
--------- ---------
Cost of Goods Sold ................................. 400,377 411,679
Research and Development Expenses .................. 53,757 51,868
Selling and Administrative Expenses ................ 131,365 127,794
Nonrecurring Charges ............................... 9,354 28,758
Interest Expense ................................... 5,211 2,199
Other (Income) Expense, Net ........................ (126) 2,045
--------- ---------
599,938 624,343
--------- ---------
Income Before Taxes on Income ...................... 138,733 114,501
Taxes on Income .................................... 46,041 38,287
--------- ---------
Net Income ......................................... 92,692 76,214
Other Comprehensive Income:
Foreign Currency Translation Adjustments ........ (15,228) (48,001)
--------- ---------
Comprehensive Income ............................... $ 77,464 $ 28,213
========= =========
Net Income Per Share - Basic ....................... $0.90 $0.72
Net Income Per Share - Diluted ..................... $0.90 $0.72
Average Number of Shares Outstanding - Basic ....... 103,311 105,917
Average Number of Shares Outstanding - Diluted ..... 103,336 106,127
Dividends Paid Per Share ........................... $0.76 $0.76
See Notes to Consolidated Financial Statements
<PAGE>
INTERNATIONAL FLAVORS & FRAGRANCES INC. 3
CONSOLIDATED STATEMENT OF CASH FLOWS
(DOLLARS IN THOUSANDS)
(Unaudited)
6 Months Ended 6/30
--------------------------
2000 1999
---------- ----------
Cash Flows From Operating Activities:
Net Income ....................................... $ 92,692 $ 76,214
Adjustments to Reconcile to Net Cash
Provided by Operations:
Depreciation ............................... 29,694 27,094
Deferred Income Taxes ...................... (8,102) 5,112
Changes in Assets and Liabilities:
Current Receivables ..................... (50,320) (50,497)
Inventories ............................. 38,671 (2,973)
Current Payables ........................ 1,608 36,500
Other, Net .............................. 11,211 6,462
--------- ---------
Net Cash Provided by Operations .................. 115,454 97,912
--------- ---------
Cash Flows From Investing Activities:
Proceeds From Sales/Maturities of
Short-term Investments ......................... 124 485
Purchases of Short-term Investments .............. (273) (828)
Additions to Property, Plant & Equipment,
Net of Minor Disposals ......................... (32,290) (63,093)
--------- ---------
Net Cash Used in Investing Activities ............ (32,439) (63,436)
--------- ---------
Cash Flows From Financing Activities:
Cash Dividends Paid to Shareholders .............. (79,035) (80,598)
Increase in Bank Loans ........................... 15,680 22,889
Proceeds from Issuance of Commercial Paper ....... 81,087 --
Increase in Long-term Debt ....................... 13,747 --
Decrease in Long-term Debt ....................... (541) (420)
Proceeds From Issuance of Stock Under
Stock Option Plans ............................. 1,319 2,436
Purchase of Treasury Stock ....................... (125,213) (847)
--------- ---------
Net Cash Used in Financing Activities ............ (92,956) (56,540)
--------- ---------
Effect of Exchange Rate Changes on
Cash and Cash Equivalents ...................... 209 (7,003)
--------- ---------
Net Change in Cash and Cash Equivalents .......... (9,732) (29,067)
Cash and Cash Equivalents at Beginning
of Year ........................................ 62,135 114,960
--------- ---------
Cash and Cash Equivalents at End of Period ....... $ 52,403 $ 85,893
========= =========
Interest Paid .................................... $ 4,195 $ 2,265
Income Taxes Paid ................................ $ 45,039 $ 35,363
See Notes to Consolidated Financial Statements
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENT 4
These interim statements and management's related discussion and analysis should
be read in conjunction with the consolidated financial statements and their
related notes, and management's discussion and analysis of results of operations
and financial condition included in the Company's 1999 Annual Report to
Shareholders. These interim statements are unaudited. In the opinion of the
Company's management, all normal recurring adjustments necessary for a fair
presentation of the results for the interim periods have been made.
As described in Note 2 of the Notes to the Consolidated Financial Statements
included in the Company's 1999 Annual Report to Shareholders, in June 1999, the
Company announced a program to streamline the Company's operations worldwide by
improving operating efficiencies and asset utilization, enabling significant
cost savings and enhanced profitability. The program includes the closure of
selected manufacturing, distribution and sales facilities in all geographic
areas in which the Company operates.
In connection with this program, in January 2000, the Company initiated a
voluntary early retirement incentive program for United States-based employees
meeting certain eligibility requirements. The nonrecurring charge of $9,354,000
($6,248,000 after tax) in the first quarter 2000 represents the costs associated
with approximately 70 employees who elected to participate in the early
retirement program. There were no significant non-cash related elements included
in the first quarter charge. There were no charges in the second quarter 2000.
At June 30, 2000, the Company had substantially completed the restructuring
program. Since the program's inception, total nonrecurring and other one-time
pretax charges of approximately $50,300,000 have been recorded ($40,900,000 of
pretax charges were recorded in 1999); non-cash charge amounts approximated
$11,700,000. The Company anticipates annual savings on completion of this
program of approximately $15,000,000; approximately $5,000,000 in savings from
the program were realized in the first six months of 2000.
Movements in the reserve resulting from nonrecurring charges were as follows:
EMPLOYEE- ASSET-
RELATED RELATED TOTAL
------------ ----------- ------------
Balance December 31, 1999 ..... $ 9,622,000 $ 1,586,000 $ 11,208,000
Additional Reserves ........... 9,354,000 -- 9,354,000
Utilized in 2000 .............. (10,038,000) (736,000) (10,774,000)
------------ ----------- ------------
Balance June 30, 2000 ......... $ 8,938,000 $ 850,000 $ 9,788,000
============ =========== ============
The balance of the reserve is to be utilized upon final decommissioning and
disposal of affected equipment, and as severance and other benefit obligations
to affected employees are satisfied.
<PAGE>
5
The Company's reportable segment information, based on geographic area, for the
first half of 2000 and 1999 follows. Certain prior year amounts have been
reclassified for comparative purposes.
<TABLE>
<CAPTION>
North Latin Asia-
2000 (Dollars in thousands) America EAME America Pacific Eliminations Consolidated
-------------------------------------- ------------ ------------ ------------ ------------ ---------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Sales to unaffiliated customers $ 235,946 $ 287,216 $ 113,014 $ 102,495 $ -- $ 738,671
Transfers between areas 27,616 58,637 768 6,193 (93,214) --
------------ ------------ ------------ ------------ --------------- --------------
Total sales $ 263,562 $ 345,853 $ 113,782 $ 108,688 $ (93,214) $ 738,671
============ ============ ============ ============ =============== ==============
Operating profit $ 34,382 $ 92,602 $ 23,066 $ 22,322 $ 323 $ 172,695
============ ============ ============ ============ ===============
Corporate and other unallocated
expenses (19,523)
Nonrecurring charges (9,354)
Interest expense (5,211)
Other income (expense), net 126
-------------
Income before taxes on income $ 138,733
==============
North Latin Asia-
1999 (Dollars in thousands) America EAME America Pacific Eliminations Consolidated
-------------------------------------- ------------ ------------ ------------ ------------ ---------------- --------------
Sales to unaffiliated customers $ 244,963 $ 304,407 $ 99,311 $ 90,163 $ -- $ 738,844
Transfers between areas 28,396 64,218 345 5,095 (98,054) --
------------ ------------ ------------ ------------ --------------- --------------
Total sales $ 273,359 $ 368,625 $ 99,656 $ 95,258 $ (98,054) $ 738,844
============ ============ ============ ============ =============== ==============
Operating profit $ 35,503 $ 94,358 $ 15,739 $ 16,214 $ 2,554 $ 164,368
============ ============ ============ ============ ===============
Corporate and other unallocated
expenses (16,865)
Nonrecurring charges (28,758)
Interest expense (2,199)
Other income (expense), net (2,045)
-------------
Income before taxes on income $ 114,501
==============
</TABLE>
Included in the 1999 operating profit for EAME are second quarter one-time
charges totalling $1,619,000 for accelerated depreciation on assets to be
disposed.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
OPERATIONS
Worldwide net sales for the second quarter of 2000 were $368,759,000, compared
to $371,079,000 in the 1999 second quarter, a decrease of 1%. Local currency
sales for the 2000 second quarter increased approximately 3% over the 1999
second quarter. However, such local currency growth was unfavorably effected by
translation into the stronger U.S. dollar. In local currency, fragrance sales in
Europe, Africa and the Middle East ("EAME") increased 4% for the quarter, while
Asia-Pacific increased 7%. Fragrance sales in North America and Latin America
rose 3% and 14%, respectively. EAME and Asia-Pacific reported increased flavor
sales, with respective local currency increases of 5% and 9%, while North
America and Latin America flavor sales declined 11% and 1%, respectively. The
weak flavor sales in North America reflect the continued weak business
conditions facing many of the Company's flavor customers.
For the first six months of 2000, worldwide net sales totaled $738,671,000,
compared to $738,844,000 for the comparable 1999 period. On a country of
destination basis, local currency sales for the six months ended June 30, 2000
were strongest in Asia-Pacific, where sales increased 10% over 1999. Local
currency sales in EAME increased 5% in comparison to the prior year period,
while sales in Latin America increased 8%. Sales in North
<PAGE>
6
America declined 2% in comparison to the prior year, mainly as a result of the
continued weak business conditions facing many of the Company's flavor
customers. For the six-month period ended June 30, 2000, the local currency
growth was mitigated on translation into the stronger U.S. dollar. Had exchange
rates been the same during 2000 and 1999, consolidated sales for the six-month
period ended June 30, 2000 would have increased approximately 4% in comparison
to the prior year period.
The percentage relationship of cost of goods sold and other operating expenses
to sales for the first half 2000 and 1999 are detailed below.
FIRST HALF
----------
2000 1999
---- ----
Cost of Goods Sold .............................. 54.2% 55.7%
Research and Development Expenses ............... 7.3% 7.0%
Selling and Administrative Expenses ............. 17.8% 17.3%
Cost of goods sold, as a percentage of net sales, decreased from the prior year
primarily due to improved economic and pricing conditions in Latin America,
principally Brazil, and stabilized pricing conditions for aroma chemicals. In
1999, the impact of the currency devaluation and economic disruption in Brazil
affected the Company's near-term ability to pass on price increases to its
customers in that market.
Research and development expenses were somewhat higher due to increased
activities in this area. Selling and administrative expenses were somewhat
higher in 2000 due to increased depreciation and other costs associated with new
computer systems and equipment, as well as certain costs incurred in connection
with an employment contract. These costs were partially offset by elimination of
costs incurred in 1999 in connection with the Company's Y2K program.
Net income for the second quarter of 2000, totaled $48,916,000 compared to
$27,434,000 in the prior year second quarter; net income for the first six
months of 2000 totaled $92,692,000 compared to $76,214,000 for the comparable
1999 period. The amounts for the first six months of 2000 and 1999 include the
effect of the nonrecurring charges discussed below. Excluding these charges,
income for the second quarter and six months ended June 30, 2000 was $48,916,000
and $98,940,000, respectively, compared to $50,579,000 and $99,359,000 for the
comparable periods in 1999.
As described in Note 2 of the Notes to the Consolidated Financial Statements
included in the Company's 1999 Annual Report to Shareholders, in June 1999, the
Company announced a program to streamline the Company's operations worldwide by
improving operating efficiencies and asset utilization, enabling significant
cost savings and enhanced profitability. The program includes the closure of
selected manufacturing, distribution and sales facilities in all geographic
areas in which the Company operates.
In connection with this program, in January 2000, the Company initiated a
voluntary early retirement incentive program for United States-based employees
meeting certain eligibility requirements. The nonrecurring charge of $9,354,000
($6,248,000 after tax) in the first quarter 2000 represents the costs associated
with approximately 70 employees who elected to participate in the early
retirement program. There were no significant non-cash related elements included
in the first quarter charge. There were no charges in the second quarter 2000.
In the second quarter 1999, the Company recorded charges of $35 million ($23
million after tax). Certain elements of those charges, relating primarily to
accelerated depreciation on assets to be disposed of, were
<PAGE>
7
recognized in cost of goods sold ($666,000) and selling and administrative
expenses ($953,000). In addition, $4,480,000 associated primarily with facility
closure was included in other income and expense. The balance of the charges,
representing employee separation and asset-related costs, were recorded as
nonrecurring charges in the Consolidated Statement of Income.
Of the total pretax charges in the second quarter of 1999, approximately
$25,400,000 were for EAME, principally employee separation costs associated with
the rationalization of certain operations and facilities in the United Kingdom,
the Netherlands and France. For North America, Latin America and Asia-Pacific,
1999 charges totaled approximately $3 million each and relate to employee
separations and closure of operations.
At June 30, 2000, the Company had substantially completed the restructuring
program. Since the program's inception, total nonrecurring and other one-time
pretax charges of approximately $50,300,000 have been recorded ($40,900,000 of
pretax charges were recorded in 1999); non-cash charge amounts approximated
$11,700,000. The Company anticipates annual savings on completion of this
program of approximately $15,000,000; approximately $5,000,000 in savings from
the program were realized in the first six months of 2000.
Movements in the reserve resulting from nonrecurring charges were as follows:
EMPLOYEE ASSET-
RELATED RELATED TOTAL
---------------------------------------------
Balance December 31, 1999 ..... $ 9,622,000 $ 1,586,000 $ 11,208,000
Additional Reserves ........... 9,354,000 -- 9,354,000
Utilized in 2000 .............. (10,038,000) (736,000) (10,774,000)
----------- ----------- ------------
Balance June 30, 2000 ......... $ 8,938,000 $ 850,000 $ 9,788,000
============ =========== ============
The balance of the reserve is to be utilized upon final decommissioning and
disposal of affected equipment, and as severance and other benefit obligations
to affected employees are satisfied.
The effective tax rates for the second quarter and first six months of 2000 was
33.2%, compared to 33.3% and 33.4% for the comparable periods in 1999. The lower
effective rate reflects the effects of lower tax rates in various tax
jurisdictions in which the Company operates.
FINANCIAL CONDITION
The financial condition of the Company continued to be strong. Cash, cash
equivalents and short-term investments totaled $53,386,000 at June 30, 2000, and
working capital was $366,127,000 compared to $465,712,000 at December 31, 1999.
Gross additions to property, plant and equipment during the first half of 2000
were $36,562,000.
At June 30, 2000, the Company's outstanding commercial paper had an average
interest rate of 6.5%. Commercial paper maturities did not extend beyond
November 30, 2000. Long-term debt increased $13,747,000 in the first six months
of 2000 due to a loan in Japan; the loan is payable in full in 2005 and bears
interest at a rate of 1.74%. Proceeds from the loan were used to repay certain
short-term borrowings and for general corporate purposes.
In each of January and April 2000, the Company paid a quarterly cash dividend of
$.38 per share to shareholders. In April 2000, the Company announced a plan to
repurchase up to an additional 7.5 million shares of its common stock. An
existing program to repurchase 7.5 million shares, which had been in effect
since 1996, was completed in the first quarter of 2000. Repurchases will be made
from time to time on the open market or through private transactions as market
and business conditions warrant. The repurchased shares will be available for
use in connection with the Company's employee benefit plans and for other
general corporate purposes. The Company anticipates that its growth, capital
spending and share repurchase plan will be funded from internal sources and
credit facilities currently in place.
<PAGE>
8
The accumulated comprehensive income component of Shareholders' Equity,
comprised principally of the cumulative translation adjustment, at June 30,
2000, was ($72,363,000) compared to ($57,135,000) at December 31, 1999. Changes
in the component result from translating the net assets of the majority of the
Company's foreign subsidiaries into U.S. dollars at current exchange rates as
required by the Statement of Financial Accounting Standards No. 52 on accounting
for foreign currency translation.
CAUTIONARY STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
Statements in this Management's Discussion and Analysis which are not historical
facts or information are "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995, and are subject to risks and
uncertainties that could cause the Company's actual results to differ materially
from those expressed or implied by such forward-looking statements. Risks and
uncertainties with respect to the Company's business include general economic
and business conditions, the price and availability of raw materials, and
political and economic uncertainties, including the fluctuation or devaluation
of currencies in countries in which the Company does business.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
There are no material changes from the disclosures in Form 10-K filed with the
Securities and Exchange Commission as of December 31, 1999.
<PAGE>
9
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
2000 Annual Meeting
-------------------
At the annual meeting of Registrant's shareholders held Thursday, May 18, 2000,
at which 91,888,860 shares, or 89.1%, of Registrant's Common Stock, were
represented in person or by proxy, the ten nominees for director of Registrant,
as listed in Registrant's proxy statement dated March 29, 2000 previously filed
with the Commission, were duly elected to Registrant's Board of Directors. There
was no solicitation of proxies in opposition to these nominees.
At such annual meeting, the shareholders also voted with respect to the two
other matters submitted for shareholder consideration as follows, the votes
being legally sufficient in each case to adopt the proposal:
Proposal to approve Registrant's 2000 Stock Option Plan
for Non-Employee Directors, covering up to 450,000 shares
of Registrant's Common Stock
-----------------------------------------------------------
No. of Shares
-------------
FOR 87,534,991
AGAINST 3,994,738
ABSTAIN AND NON-VOTING 359,131
Proposal to approve Registrant's 2000 Stock Award and
Incentive Plan, covering up to 4.5 million shares of
Registrant's Common Stock
-----------------------------------------------------------
No. of Shares
-------------
FOR 86,610,429
AGAINST 4,909,236
ABSTAIN AND NON-VOTING 369,195
<PAGE>
10
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Number
3 Amendments to Registrant's By-laws adopted April 13, 2000
and May 18, 2000.
10(a) Memorandum of Understanding between Registrant and Richard
A. Goldstein, Chairman and Chief Executive Officer of
Registrant, approved by Registrant's Board of Directors on
April 13, 2000.
10(b) Registrant's Executive Separation Policy adopted April 13,
2000.
10(c) Amended and Restated 364-day Credit Agreement dated as of
May 30, 2000 among Registrant as Borrower, certain Initial
Lenders, Citibank, N.A. as Agent and Salomon Smith Barney
Inc., as Arranger.
27 Financial Data Schedule (EDGAR version only).
(b) REPORTS ON FORM 8-K
Registrant filed no report on Form 8-K during the quarter for
which this report on Form 10-Q is filed.
<PAGE>
11
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.
INTERNATIONAL FLAVORS & FRAGRANCES INC.
Dated: August 14, 2000 By: /s/ DOUGLAS J. WETMORE
----------------------------------
Douglas J. Wetmore, Vice-President
and Chief Financial Officer
Dated: August 14, 2000 By: /s/ STEPHEN A. BLOCK
----------------------------------
Stephen A. Block, Senior Vice-
President, General Counsel
and Secretary
