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
May 2, 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 May 2, 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 May 2, 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: May 2, 1997
VALHI REPORTS FIRST QUARTER RESULTS
DALLAS, TEXAS . . May 2, 1997 . . Valhi, Inc. (NYSE: VHI) reported a loss
from continuing operations of $23.1 million, or $.20 per share, for the first
quarter of 1997 compared to income of $8.6 million, or $.07 per share, in the
first quarter of 1996. The 1997 loss includes a $30 million pre-tax charge
($19.5 million, or $.17 per share, net-of-tax) related to the adoption of a new
accounting standard regarding accounting for environmental remediation
liabilities at NL Industries, Inc.
Chemicals earnings at 56%-owned NL Industries declined in 1997 from the
year-ago period as higher sales volumes of titanium dioxide pigments ("TiO2")
were more than offset by lower TiO2 selling prices. Average TiO2 selling prices
for the first quarter of 1997 were 16% lower than the first quarter of 1996 and
2% lower than the fourth quarter of 1996. NL continued to experience strong
demand for TiO2 in the first quarter, reporting record first quarter sales
volumes that were 22% higher than the first quarter of 1996. In other
operations, the Company's component products business reported higher sales and
operating income.
As previously reported, in early January 1997 the Company transferred
control of the refined sugar operations previously conducted by the Company's
wholly-owned subsidiary, The Amalgamated Sugar Company, to Snake River Sugar
Company, an Oregon cooperative. Pursuant to the transaction, Amalgamated
contributed substantially all of its net assets to the Amalgamated Sugar Company
LLC, a limited liability company controlled by Snake River, on a tax-deferred
basis in exchange for a non-voting interest in the LLC. Accordingly, the
Company ceased consolidating the results of operations of such business
effective December 31, 1996. For comparative purposes, Amalgamated's 1996
results of operations are reported by the equity method. As part of the
transaction, Valhi provided approximately $192 million in debt financing to
Snake River, and Snake River made certain loans to Valhi aggregating $250
million.
Securities earnings increased in 1997 due 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. General corporate
expenses in 1997 include NL's $30 million environmental remediation charge
discussed above. Interest expense increased in 1997 due primarily to Valhi's
loans from Snake River.
Discontinued operations include both the results of Medite Corporation's
building products operations and Sybra, Inc.' s fast food operations, and in the
first quarter of 1997 include a net-of-tax gain on disposal of approximately
$14.2 million ($22.5 million pre-tax) related to the previously-reported sale of
Medite's Oregon medium density fiberboard facility. The Company completed the
sale of its fast food operations on April 30, 1997 and will report a pre-tax
gain on disposal in excess of $24 million in the second quarter of 1997.
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), future global economic conditions,
changes in government regulations, 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, completion of pending asset/business unit dispositions and other
risks and uncertainties detailed in the Company's SEC filings.
Valhi, Inc. is engaged in the chemicals, component products and waste
management industries.
* * * * *
VALHI, INC. AND SUBSIDIARIES
SUMMARY OF OPERATIONS
(Unaudited)
Quarters ended March 31, 1996 and 1997
(In millions, except earnings per share)
<TABLE>
<CAPTION>
1996* 1997
<S> <C> <C>
NET SALES
Chemicals $240.4 $239.5
Component products 21.2 25.8
$261.6 $265.3
OPERATING INCOME
Chemicals $ 36.6 $ 13.5
Component products 4.4 6.3
TOTAL OPERATING INCOME 41.0 19.8
Equity in Amalgamated 3.6 -
Equity in Waste Control Specialists (1.1) (2.7)
General corporate items, net:
Securities earnings 2.7 14.7
Expenses, net (6.7) (34.9)
Interest expense (24.8) (30.7)
Income (loss) before taxes 14.7 (33.8)
Income taxes (benefit) 3.8 (10.7)
Minority interest 2.3 -
INCOME (LOSS) FROM CONTINUING 8.6 (23.1)
OPERATIONS
Discontinued operations (14.3) 15.6
NET LOSS $ (5.7) $ (7.5)
INCOME (LOSS) PER COMMON SHARE
Continuing operations $ .07 $ (.20)
Discontinued operations (.12) .13
NET LOSS $ (.05) $ (.07)
Weighted average common shares 114.6 114.8
outstanding
</TABLE>
*Reclassified for discontinued operations.
