SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
October 27, 1997
(Date of Report, date of earliest event reported)
VALHI, INC.
(Exact name of Registrant as specified in its charter)
Delaware 1-5467 87-0110150
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) No.)
5430 LBJ Freeway, Suite 1700, Dallas, TX 75240-2697
(Address of principal executive offices) (Zip Code)
(972) 233-1700
(Registrant's telephone number, including area code)
Not applicable
(Former name or address, if changed since last report)
Item 5: Other Events
On October 27, 1997, the Registrant issued the press release attached
hereto as Exhibit 99.1 which is incorporated herein by reference.
Item 7: Financial Statements, Pro Forma Financial Information and Exhibits
(c) Exhibit
Item No. Exhibit Index
99.1 Press release dated October 27, 1997
issued by the Registrant
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 hereunto duly authorized.
VALHI, INC.
(Registrant)
By: /s/ Bobby D. O'Brien
Bobby D. O'Brien
Vice President
Date: October 27, 1997
VALHI REPORTS THIRD QUARTER RESULTS
DALLAS, TEXAS . . October 27, 1997 . . Valhi, Inc. (NYSE: VHI) reported
income from continuing operations of $8.4 million, or $.07 per share, for the
third quarter of 1997 compared to a loss of $7.8 million, or $.07 per share, in
the third quarter of 1996. For the first nine months of 1997, Valhi reported a
loss from continuing operations of $12.1 million, or $.10 per share, compared to
income of $6.3 million, or $.05 per share, in the first nine months of 1996.
The 1997 year-to-date loss includes a first quarter noncash pre-tax charge of
$30 million ($19.5 million, or $.17 per share, net-of-tax), included in general
corporate expenses, which relates to the adoption of a new accounting standard
regarding accounting for environmental remediation liabilities at NL Industries,
Inc.
Chemicals operating income at 56%-owned NL Industries in the third quarter
of 1997 was $18 million higher than the third quarter of 1996 due in part to
higher average selling prices and sales volumes for titanium dioxide pigments
("TiO2"). Average TiO2 selling prices for the third quarter of 1997 were 1%
higher than the third quarter of 1996 and 3% higher than the second quarter of
1997. Selling prices at the end of the third quarter of 1997 were 2% higher
than the average for the quarter. NL achieved record third quarter TiO2 sales
volumes reflecting continued strong demand, particularly in Europe, as third
quarter and first nine month sales volumes increased 7% and 12%, respectively,
from the year-earlier periods. NL expects further increases in its TiO2 selling
prices during the fourth quarter of 1997. Chemicals operating income in the
third quarter of 1997 also includes income of $9.7 million resulting from
refunds of prior-year German franchise taxes. The Company's component products
business reported higher sales and operating income due primarily to higher
sales volumes in all three of its major product lines (ergonomic workstations,
drawer slides and locks). The Company's equity in Waste Control Specialists'
losses was higher in 1997 due principally to start-up expenses associated with
its new facility for the treatment, storage and disposal of hazardous and toxic
wastes, as well as larger expenditures in conjunction with its on-going pursuit
of permits for the treatment, storage and disposal of low-level and mixed
radioactive wastes.
Securities earnings increased in 1997 due primarily to cash distributions
received from The Amalgamated Sugar Company LLC, which are reported as dividend
income, as well as a higher level of funds available for investment, including
interest earned on the debt financing Valhi provided to Snake River Sugar
Company in 1997 and the investment of funds generated from the disposal of
discontinued operations. Interest expense increased in 1997 due primarily to
Valhi's loans from Snake River.
Discontinued operations represent the results of the Company's former
building products and fast food operations. The extraordinary loss relates to
the premium paid and unamortized deferred financing costs in connection with the
September 1997 early retirement of $66.2 million principal amount of Valcor's
9 5/8% Senior Notes.
The statements in this release relating to matters that are not historical
facts are forward-looking statements that involve risks and uncertainties,
including, but not limited to, future supply and demand for the Company's
products (including cyclicality thereof), competitive products, customer and
competitor strategies, the impact of pricing and production decisions,
environmental matters, the ultimate resolution of pending litigation and any
possible future litigation and other risks and uncertainties detailed in the
Company's SEC filings. Actual results could differ materially from those
forecasted or expected.
Valhi, Inc. is engaged in the chemicals, component products and waste
management industries.
* * * * *
VALHI, INC. AND SUBSIDIARIES
SUMMARY OF OPERATIONS
(UNAUDITED)
(IN MILLIONS, EXCEPT EARNINGS PER SHARE)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
1996* 1997 1996* 1997
<S> <C> <C> <C> <C>
NET SALES
Chemicals $248.5 $248.3 $752.1 $740.5
Component products 21.8 27.0 64.7 80.3
$270.3 $275.3 $816.8 $820.8
OPERATING INCOME
Chemicals $ 14.1 $32.1 $ 81.5 $69.5
Component products 5.4 6.9 14.8 20.1
TOTAL OPERATING INCOME 19.5 39.0 96.3 89.6
Equity in Waste Control Specialists (1.6) (3.4) (4.0) (8.9)
Equity in Amalgamated .3 - 4.9 -
General corporate items, net:
Securities earnings 2.4 17.3 7.5 48.6
Expenses, net (5.4) (7.8) (14.2) (50.9)
Interest expense (24.5) (30.2) (73.6) (91.5)
Income (loss) before income taxes (9.3) 14.9 16.9 (13.1)
Income taxes (benefit) (3.8) 6.5 3.7 (1.0)
Minority interest 2.3 - 6.9 -
Income (loss) from continuing (7.8) 8.4 6.3 (12.1)
operations
Discontinued operations 2.9 (.9) (8.1) 34.5
Extraordinary item - (3.9) - (4.3)
NET INCOME (LOSS) $ (4.9) $ 3.6 $(1.8) $18.1
INCOME (LOSS) PER COMMON SHARE
Continuing operations $ (.07) $ .07 $ .05 $ (.10)
Discontinued operations .03 (.01) (.06) .30
Extraordinary item - (.03) - (.04)
NET INCOME (LOSS) $ (.04) $ .03 $ (.01) $ .16
Weighted average common shares 114.6 115.1 114.6 115.0
outstanding
</TABLE>
[FN]
*Reclassified.
