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 June 27, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 1-6085
____________________________
IBP, inc.
a Delaware Corporation
I.R.S. Employer Identification No. 42-0838666
IBP Avenue
Post Office Box 515
Dakota City, Nebraska 68731
Telephone 402-494-2061
____________________________
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, and (2) has been subject to such filing
requirements for the past 90 days.
YES [X] NO [ ]
As of August 1, 1998, the registrant had outstanding 92,544,468 shares of
its common stock ($.05 par value).
PART I. FINANCIAL INFORMATION
IBP, inc. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
June 27, December 27,
1998 1997
________ ____________
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 16,914 $ 69,022
Marketable securities 28,085 3,120
Accounts receivable, less allowance for
doubtful accounts of $10,494 and $10,063 634,435 564,125
Inventories 415,892 389,753
Deferred income tax benefits and
prepaid expenses 58,865 57,907
_________ _________
TOTAL CURRENT ASSETS 1,154,191 1,083,927
Property, plant and equipment,
less accumulated depreciation
of $816,424 and $774,694 1,035,458 1,017,082
Goodwill, net of accumulated
amortization of $149,492 and $137,996 660,033 671,557
Other assets 93,876 66,375
_________ _________
$2,943,558 $2,838,941
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes payable to banks $ 348,057 $ 192,010
Accounts payable 281,497 345,728
Deferred income taxes and other
current liabilities 325,051 339,080
_______ _______
TOTAL CURRENT LIABILITIES 954,605 876,818
Long-term debt and capital lease
obligations 567,030 568,281
Deferred income taxes and other
liabilities 161,534 156,773
STOCKHOLDERS' EQUITY:
Common stock at par value 4,750 4,750
Additional paid-in capital 405,567 406,952
Retained earnings 914,972 886,964
Accumulated other comprehensive income (8,756) (6,114)
Treasury stock (56,144) (55,483)
_________ _________
TOTAL STOCKHOLDERS' EQUITY 1,260,389 1,237,069
_________ _________
$2,943,558 $2,838,941
========= =========
See accompanying notes to condensed consolidated financial statements.
-2-
IBP, inc. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
(In thousands, except per share data)
13 Weeks Ended 26 Weeks Ended
____________________ ____________________
June 27, June 28, June 27, June 28,
1998 1997 1998 1997
_________ _________ _________ _________
Net sales $3,334,340 $3,448,337 $6,559,284 $6,582,927
Cost of products sold 3,208,199 3,328,378 6,329,314 6,380,112
_________ _________ _________ _________
Gross profit 126,141 119,959 229,970 202,815
Selling, general and
administrative expense 59,588 54,703 128,773 85,699
_________ _________ _________ _________
EARNINGS FROM OPERATIONS 66,553 65,256 101,197 117,116
Interest expense, net 11,900 9,892 24,645 10,442
_________ _________ _________ _________
Earnings before income
taxes and extraordinary
item 54,653 55,364 76,552 106,674
Income tax expense 20,800 21,500 29,100 40,500
_________ _________ _________ _________
Earnings before
extraordinary item 33,853 33,864 47,452 66,174
Extraordinary loss on early
extinguishment of debt,
less applicable taxes
(Note D) - -__ 14,815 _
_________ _________ __________ _________
NET EARNINGS $ 33,853 $ 33,864 $ 32,637 $ 66,174
========= ========= ========== ========
Earnings per share:
Earnings before
extraordinary item $ .37 $ .37 $ .51 $ .71
Extraordinary item - -__ (.16) - _
____ ____ _____ ____
Net earnings $ .37 $ .37 $ .35 $ .71
==== ==== ===== ====
Earnings per share - assuming
dilution:
Earnings before
extraordinary item $ .36 $ .36 $ .51 $ .70
Extraordinary item - -__ (.16) -__
____ ____ _____ ____
Net earnings $ .36 $ .36 $ .35 $ .70
==== ==== ===== ====
Dividends per share $.025 $.025 $.05 $ .05
==== ==== === ====
See accompanying notes to condensed consolidated financial statements.
-3-
IBP, inc. AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
26 Weeks Ended
_____________________________
June 27, June 28,
1998 1997
_________ __________
Inflows(outflows)
NET CASH FLOWS USED IN OPERATING ACTIVITIES $ (42,210) $ (106,046)
_________ __________
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of marketable securities (146,759) (215,073)
Proceeds from disposals of marketable
securities 128,879 373,346
Capital expenditures (77,425) (62,757)
Investment in life insurance contracts (33,000) -
Payment for stock of new subsidiaries,
net of cash acquired - (307,676)
Other investing activities, net ( 3,969) (2,459)
_________ __________
Net cash flows used in
investing activities (132,274) (214,619)
_________ __________
CASH FLOWS FROM FINANCING ACTIVITIES:
Increase in borrowings under revolving
credit agreements 218,400 378,500
Principal payments on long-term
obligations (113,293) (195,816)
Proceeds from issuance of long-term debt 49,760 123,887
Net change in checks in process of
clearance (4,926) 16,262
Premiums paid on early retirement
of debt (20,636) -
Purchases of treasury stock (1,957) (59,901)
Other financing activities, net (5,021) (9,287)
_________ __________
Net cash flows provided by
financing activities 122,327 253,645
_________ _________
Effect of exchange rate on cash
and cash equivalents 49 26
_________ _________
Net change in cash and cash equivalents (52,108) (66,994)
Cash and cash equivalents at beginning
of period 69,022 94,164
_________ _________
Cash and cash equivalents at end of
period $ 16,914 $ 27,170
========= =========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the periods for:
Interest, net of amounts capitalized $ 24,726 $ 21,186
Income taxes, net of refunds received 5,207 38,236
Depreciation and amortization expense 50,638 41,473
Amortization of intangible assets 12,249 6,763
See accompanying notes to condensed consolidated financial statements.
- -4-
IBP, inc. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
A. GENERAL
The condensed consolidated balance sheet of IBP, inc. and
subsidiaries ("IBP" or "the company") at December 27, 1997 has been
taken from audited financial statements at that date and condensed.
All other condensed consolidated financial statements contained
herein have been prepared by IBP and are unaudited. The condensed
consolidated financial statements should be read in conjunction with
the consolidated financial statements and the notes thereto included
in IBP's Annual Report on Form 10-K for the year ended December 27,
1997.
In the opinion of management, the accompanying unaudited
condensed consolidated financial statements contain all adjustments,
consisting only of normal recurring adjustments, necessary to present
fairly the financial position of IBP at June 27, 1998 and the results
of its operations and its cash flows for the periods presented
herein.
Derivatives and hedging activities: In June 1998, the Financial
Accounting Standards Board issued Statement of Financial Accounting
Standards No. 133, "Accounting for Derivative Instruments and Hedging
Activities." The company must adopt this standard no later than the
first quarter of fiscal 2000. Management is reviewing the
requirements of this statement, which are quite complex. Although
management expects that this standard will not materially affect its
financial position and results of operations, it has not yet
determined the impact of this standard on the financial statements of
the company.
Business segments: Effective at year-end 1998, the company will
adopt SFAS No. 131, "Disclosure about Segments of an Enterprise and
Related Information." Management is reviewing the requirements of
this statement and believes that it will change the extent of its
current business segment disclosure. This statement does not impact
the basic consolidated financial statements; it affects the
presentation of segment information in the Notes to Consolidated
Financial Statements.
Reclassifications: Certain reclassifications have been made to
prior financial statements to conform to the current year
presentation.
B. OTHER
IBP's interim operating results may be subject to substantial
fluctuations which do not necessarily occur or recur on a seasonal
basis. Such fluctuations are normally caused by competitive and
other conditions in the cattle and hog markets over which IBP has
little or no control. Therefore, the results of operations for the
interim periods presented are not necessarily indicative of the
results to be attained for the full fiscal year.
- -5-
C. INVENTORIES
Inventories, valued at the lower of first-in, first-out cost or
market, are comprised of the following:
June 27, December 27,
1998 1997
________ ____________
(In thousands)
Product inventories:
Raw materials $ 19,567 $ 22,952
Work in process 71,287 82,679
Finished goods 183,124 165,970
_______ _______
273,978 271,601
Livestock 67,445 45,908
Supplies 74,469 72,244
_______ _______
$415,892 $389,753
======= =======
D. LONG-TERM OBLIGATIONS
Long-term obligations are summarized as follows:
June 27, December 28,
(in thousands) 1998 1997
________ ____________
7.45% Senior Notes due 2007 $125,000 $125,000
6.125% Senior Notes due 2006 100,000 100,000
7.125% Senior Notes due 2026 100,000 100,000
6.00% Securities due 2011 50,000 -
10.75% Senior Subordinated
Notes due 2006 - 112,050
Revolving credit facilities 175,000 112,950
Present value of minimum
capital lease obligations 18,075 19,093
Other 1,184 1,400
_______ _______
569,259 570,493
Less amounts due within
one year 2,229 2,212
_______ _______
$567,030 $568,281
======= =======
During the first quarter 1998, the company completed its
purchase of all of the $112 million outstanding 10.75% Senior
Subordinated Notes of its wholly-owned subsidiary, Foodbrands
America, Inc. Net prepayment premiums, accelerated amortization
of unamortized deferred financing costs, and transaction expenses
totaled $24 million, before applicable income tax benefit of $9
million, and was accounted for as an extraordinary loss.
The purchase of these obligations by IBP was funded with
available credit facilities and will likely be refinanced later in
1998 under the company's $300 million Medium-Term Notes program
registered with the Securities and Exchange Commission. The
portion of borrowings under IBP's revolving credit facilities
considered long-term increased to $175 million at June 27, 1998
from $113 million at December 27, 1997.
- -6-
In January 1998, the company settled and closed its public
offering of $50 million aggregate principal amount of 6.00%
Remarketable or Redeemable Securities, due January 15, 2011 (the
"6.00% Securities"). The net proceeds from the 6.00% Securities
were added to the company's working capital. The 6.00% Securities
were the first series of notes issued under the company's Medium-
Term Notes program.
E. EARNINGS PER SHARE
(in thousands, except per share amounts)
For the Thirteen Weeks Ended June 27, 1998
__________________________________________
Earnings Shares Per Share
(Numerator) (Denominator) Amount
___________ _____________ _________
Basic EPS:
Net earnings $33,853 92,557 $ .37
====
Effect of dilutive
securities:
Employee stock plans 823
______ _______
Diluted EPS $33,853 93,380 $ .36
====== ====== ====
For the Thirteen Weeks Ended June 28, 1997
__________________________________________
Earnings Shares Per Share
(Numerator) (Denominator) Amount
___________ _____________ _________
Basic EPS:
Net earnings $33,864 92,061 $ .37
====
Effect of dilutive
securities:
Employee stock plans 1,227
______ ______
Diluted EPS $33,864 93,288 $ .36
====
For the Twenty-six Weeks Ended June 27, 1998
____________________________________________
Earnings Shares Per Share
(Numerator) (Denominator) Amount
___________ _____________ _________
Basic EPS:
Earnings before
extraordinary item $47,452 92,562 $ .51
====
Effect of dilutive
securities:
Employee stock plans 888
______ ______
Diluted EPS $47,452 93,450 $ .51
====== ====== ====
For the Twenty-six weeks Ended June 28, 1997
____________________________________________
Earnings Shares Per Share
(Numerator) (Denominator) Amount
___________ _____________ _________
Basic EPS:
Net earnings $66,174 92,977 $ .71
====
Effect of dilutive
securities:
Employee stock plans 1,237
______ ______
Diluted EPS $66,174 94,214 $ .70
====== ====== ====
The following summary lists stock options outstanding at the end
of the fiscal quarters which were not included in the computations
of diluted EPS because the options' exercise prices were greater
than the average market price of the common shares. These options
had varying expiration dates.
- -7-
1998 1997
____ ____
Stock options excluded from
diluted EPS computation 1,541 1,442
Average option price per share $24.69 $25.04
F. COMMITMENTS AND CONTINGENCIES
IBP is involved in numerous disputes incident to the ordinary
course of its business. In the opinion of management, any
liability for which provision has not been made relative to the
various lawsuits, claims and administrative proceedings pending
against IBP, including that described below, will not have a
material adverse effect on its consolidated results of operations,
financial position or liquidity.
In July 1996, a lawsuit was filed against IBP by certain
cattle producers in the U.S. District Court, Middle District of
Alabama, seeking certification of a class of all cattle producers.
The complaint alleges, inter alia, that IBP has used its market
power and alleged "captive supply" agreements to reduce the prices
paid to producers for cattle. Plaintiffs have disclosed that, in
addition to declaratory relief and punitive damages, they seek
disgorgement of all profits earned in 1994, 1995 and 1996 in
excess of what they deem a "fair" return. Management believes
that class certification is unlikely and that, in any event, it
has acted properly and lawfully in its dealings with cattle
producers.
G. COMPREHENSIVE INCOME
In the first quarter of 1998, the company adopted Statement of
Financial Accounting Standards No. 130, "Reporting Comprehensive
Income." The standard requires the display and reporting of
comprehensive income, which includes all changes in stockholders'
equity with the exception of additional investments by
stockholders or distributions to stockholders. Comprehensive
income for the company includes net income and foreign currency
translation adjustments which are charged or credited to the
cumulative translation account within stockholders' equity.
Comprehensive income for the 26 weeks ended June 27, 1998 and June
28, 1997 was as follows (unaudited):
26 Weeks Ended
_______________
June 27, June 28,
1998 1997
________ ________
NET EARNINGS $ 32,637 $ 66,174
_______ _______
Other comprehensive income,
before tax:
Foreign currency translation
adjustments (2,641) (719)
Income tax expense related
to items of other
comprehensive income 1,004 273
_______ _______
Other comprehensive income,
net of tax (1,637) (446)
_______ _______
COMPREHENSIVE INCOME $ 31,000 $ 65,728
======= =======
- -8-
MANAGEMENT'S DISCUSSION AND ANALYSIS
____________________________________
RESULTS OF OPERATIONS
Stong contributions by IBP's pork and foodservice divisions offset
weaker beef results en route to a second quarter earnings performance
comparable to the second quarter 1997 and more than double the first
quarter 1998 earnings.
Earnings from operations, measured as a percentage of net sales,
improved to 2.0% in the second quarter 1998 from 1.9% in the same
1997 period. Pork results improved due to increased capacity
utilization, lower raw material costs and much-improved performance
at the Logansport, Indiana, facility, which is now beyond the start
up phase. In addition, IBP benefited from consolidation of a full
quarter of operations of Foodbrands America, Inc. ("Foodbrands") and
The Bruss Company ("Bruss") in 1998 versus approximately nine weeks
for Foodbrands and five weeks for Bruss in the second quarter 1997.
For the six months ended June, 1998 operating earnings measured
1.5% of net sales versus 1.8% in the first half of 1997. The lower
1998 figure reflected reduced beef margins caused by burdensome
competing domestic meat supplies and weaker export demand resulting
from economic problems in the Far East. Meanwhile, pork performance
improved significantly in 1998 compared to the first half of 1997 and
foodservice operations contributed positively due to the above-
mentioned factors.
The matters discussed herein contain forward-looking statements
that involve risks and uncertainties including risk of changing
market conditions with regard to livestock supplies and demand for
the company's products, domestic and international regulatory risks,
competitive and other risks over which IBP has little or no control.
Consequently, future results may differ from management's
expectations. Moreover, past financial performance should not be
considered a reliable indicator of future performance.
SALES
Second quarter and six months 1998 net sales decreased from the
same 1997 periods. New operations (Foodbrands, Bruss and Platte
County Processed Meats, Inc. ("Platte County"), a ground beef
processing plant in Nebraska), added net increases of $134 million
and $416 million, respectively, to second quarter and year-to-date
1998 consolidated net sales. Meanwhile, IBP's core fresh meats
operations net sales decreased 8% in the second quarter 1998 and 7%
in the year-to-date period compared to 1997. Lower average prices of
beef and pork products sold were only partially offset by increases
in pounds of beef and pork products sold, reflecting the glut of
competing proteins domestically and weaker export demand.
Second quarter 1998 net export sales decreased slightly and year-
to-date 1998 exports were flat compared with the 1997 periods.
Export tonnage increased 23% in the first half of 1998 compared to
1997 but was offset by unfavorable price and product mix variances.
The Asian region accounted for 67% of total net export sales in the
first half of 1998 compared to 74% in the same 1997 period.
- -9-
The Far East shortfall was absorbed by increased exports to Mexico,
Canada and South America destinations. Exports totaled approximately
13% of consolidated net sales in all comparison periods presented.
COST OF PRODUCTS SOLD
Second quarter 1998 cost of products sold decreased 4% from the
second quarter 1997. Excluding a $109 million increase attributable
to new operations (Foodbrands, Bruss and Platte County), IBP's core
fresh meats operations cost of products sold decreased 7% in the
second quarter 1998 versus 1997. The fresh meats business benefited
from lower average prices paid for live hogs and cattle offset
somewhat by an increase in pounds of pork products sold. Fresh meats
plant costs in the second quarter 1998 increased over the second
quarter 1997 primarily as a result of higher labor and volume-related
costs.
The cost of products sold in the six months ended June 1998
decreased 1% from the same 1997 period. While Foodbrands, Bruss and
Platte County accounted for a $344 million increase in year-over-year
costs, IBP's previously existing operations experienced a 6% decrease
in 1998 costs versus the prior year. This 6% decrease was primarily
due to reduced average prices paid for live hogs and cattle which
overrode the effect of increases in pounds of pork and beef products
sold. Plant costs increased due to higher labor costs and increased
pork volume.
Industry analysts predict that cattle supplies should be
favorable for most of 1998 and will tighten later this year or
sometime during 1999. Meanwhile, hog supplies are expected to be
excellent in the second half of 1998 and into 1999.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSE
While second quarter 1998 expense increased 9% over the second
quarter 1997, the increase and more was due to expenses incurred at
Foodbrands and Bruss. Excluding Foodbrands and Bruss, second quarter
1998 expense decreased 25% from the second quarter 1997. The lower
comparable 1998 expense was due in part to accrual of refunds of U.S.
harbor maintenance taxes paid in prior years, based upon a U.S.
Supreme Court decision which ruled their collection unconstitutional.
Year-to-date 1998 expense through June was 50% higher than in the
comparable year-earlier period. The effect of new subsidiaries
increased consolidated expense by $51 million in the first six months
of 1998 over 1997. Foodbrands' selling expense is much higher as a
percentage of net sales compared to IBP's fresh meats operations due
to differences in the nature of the respective product and customer
bases. Excluding new operations, expense decreased 13% in the six
month period ended June 1998 versus 1997, helped by the harbor
maintenance tax refunds discussed above.
INTEREST EXPENSE
The higher net interest expense in the second quarter and year-
to-date periods ended June 1998 versus the comparable 1997 periods
was primarily attributable to higher average borrowings brought about
by the purchases of Foodbrands and Bruss in the second quarter 1997.
- -10-
LIQUIDITY AND CAPITAL RESOURCES
Total consolidated outstanding borrowings averaged $867 million in
the first six months of 1998 compared to $466 million in the
comparable 1997 period. Available unused credit capacity under
committed facilities totaled $226 million at June 27, 1998.
The purchase of the Foodbrands 10.75% Notes in the first quarter
1998 by the company was funded with available credit facilities and
will likely be refinanced later in 1998 under the company's $300
million Medium-Term Notes program registered with the Securities and
Exchange Commission. The portion of borrowings under IBP's revolving
credit facilities considered long-term increased to $175 million at
March 28, 1998 from $113 million at December 27, 1997.
In January 1998, the company settled and closed its public
offering of $50 million aggregate principal amount of 6.00%
Remarketable or Redeemable Securities, due January 15, 2011 (the
"6.00% Securities"). The net proceeds from the 6.00% Securities were
added to the company's working capital. The 6.00% Securities were a
series of notes issued under the company's Medium-Term Notes program.
The company invested $37 million during the fourth quarter 1997
and the first quarter 1998 in life insurance contracts for key
employees. Among other advantages, expected changes in the cash
value of these contracts are intended to effectively act as a hedge
against changes in the company's deferred compensation liabilities.
Year-to-date capital expenditures through June 27, 1998 totaled
$77 million compared to $63 million in the first six months of 1997.
Current year spending was primarily for pork and foodservice plant
expansions, food safety processes, and construction of the company's
new world headquarters.
IMPACT OF NEW ACCOUNTING PRONOUNCEMENTS
Derivatives and hedging activities: In June 1998, the Financial
Accounting Standards Board issued Statement of Financial Accounting
Standards No. 133, "Accounting for Derivative Instruments and Hedging
Activities." The company must adopt this standard no later than the
first quarter of fiscal 2000. Management is reviewing the requirements
of this statement, which are quite complex. Although management expects
that this standard will not materially affect its financial position and
results of operations, it has not yet determined the impact of this
standard on the financial statements of the company.
Business segments: Effective at year-end 1998, the company will
adopt SFAS No. 131, "Disclosure about Segments of an Enterprise and
Related Information." Management is reviewing the requirements of this
statement and believes that it will change the extent of its current
business segment disclosure. This statement does not impact the basic
consolidated financial statements; it affects the presentation of
segment information in the Notes to Consolidated Financial Statements.
- -11-
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
(a) The annual meeting of stockholders of IBP, inc. was held on April 23,
1998, in Dakota City, Nebraska.
(c) The following matters were voted upon at the annual meeting:
(i) The election of the members of the Board of Directors:
Richard L. Bond
Votes for: 80,478,825
Votes withheld: 370,141
John S. Chalsty
Votes for: 80,503,191
Votes withheld: 345,775
Dr. Wendy L. Gramm
Votes for: 80,495,296
Votes withheld: 353,670
John J. Jacobson, Jr.
Votes for: 80,508,699
Votes withheld: 340,267
Eugene D. Leman
Votes for: 80,473,650
Votes withheld: 375,316
Martin A. Massengale
Votes for: 80,495,793
Votes withheld 353,175
Robert L. Peterson
Votes for: 80,476,087
Votes withheld: 372,879
Michael L. Sanem
Votes for: 80,489,784
Votes withheld: 359,182
JoAnn R. Smith
Votes for: 80,514,776
Votes withheld: 334,190
Dale C. Tinstman
Votes for: 80,171,457
Votes withheld: 677,509
- -12-
Item 5. Other Information
In connection with its Medium-Term Notes program, the company
hereby reports the following computations:
26 Weeks Ended
____________________
June 27, June 28,
1998 1997
________ _________
Earnings before income taxes
and extraordinary item $ 76,552 $106,674
Total fixed charges 33,176 19,961
Capitalized interest (3,345) (3,826)
_______ _______
Earnings before fixed charges,
income taxes and extraordinary
item $106,383 $122,809
======= =======
Ratio of earnings to fixed charges 3.2 6.2
=== ===
Item 6. Exhibits and Reports on Form 8-K
(b) Reports on Form 8-K
No reports on Form 8-K were filed by the company during the
quarter ended June 27, 1998.
- -13-
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the
registrant has caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
IBP, inc.
__________________________
(Registrant)
August 5, 1998
______________________ /s/ Robert L. Peterson
(date) _________________________
Robert L. Peterson
Chairman of the Board and
Chief Executive Officer
/s/ Larry Shipley
__________________________
Larry Shipley
Chief Financial Officer
/s/ Craig J. Hart
___________________________
Craig J. Hart
Vice President
and Controller
- -14-
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<PERIOD-END> JUN-27-1998
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<RECEIVABLES> 644,929
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