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
April 23, 1998
(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 April 23, 1998, 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 April 23, 1998
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 & Treasurer
Date: April 23, 1998
VALHI REPORTS FIRST QUARTER RESULTS
DALLAS, TEXAS . . April 23, 1998. Valhi, Inc. (NYSE: VHI) reported income
from continuing operations of $204.7 million, or $1.76 per diluted share, in the
first quarter of 1998 compared to a loss from continuing operations of $23.1
million, or $.20 per diluted share, in the first quarter of 1997. The 1998
results include (i) a $330 million pre-tax gain related to the January 1998 sale
of NL Industries' specialty chemicals business unit ($152 million, or $1.31 per
diluted share, net of income taxes and minority interest) and (ii) a $68 million
pre-tax gain related to the reduction in the Company's ownership interest in
CompX International ($44 million, or $.38 per diluted share, net of income
taxes) in conjunction with CompX's March 1998 initial public offering of shares
of its common stock. The 1997 first quarter results included a $30 million pre-
tax charge ($19.5 million, or $.17 per diluted share, net of income taxes)
related to the adoption of a new accounting standard regarding accounting for
environmental remediation liabilities at NL.
NL's TiO2 operating income increased in the first quarter of 1998 compared
to the year-ago period due primarily to higher average selling prices, improved
production volumes and record sales volumes. NL's average Ti02 selling prices
have continued to increase since early 1997, and NL's average TiO2 selling
prices in the first quarter of 1998 were 17% higher than the first quarter of
1997 and were 5% higher than the fourth quarter of last year. NL's first
quarter 1998 Ti02 sales volumes were 2% higher than the first quarter of 1997.
NL expects to realize further increases in its Ti02 selling prices during the
remainder of 1998. The Company's first quarter 1997 results included net sales
of $35.1 million and operating income of $9.7 million related to NL's disposed
specialty chemicals business unit (1998 net sales and operating income prior to
the sale - $12.7 million and $2.7 million, respectively).
The Company's component products business, operated by CompX, reported
record sales in the first quarter of 1998 due primarily to higher volumes in all
three of its major product lines (ergonomic computer support systems, precision
ball bearing slides and locks). Approximately one-third of the increase in net
sales resulted from the March 1998 acquisition of a lock competitor. Component
products operating income in the first quarter of 1998 includes a $3.3 million
non-recurring pre-tax charge related to the award of certain shares of CompX
common stock in connection with completion of its initial public offering.
Securities earnings increased in the first quarter of 1998 due primarily to
a higher level of funds available for investment. General corporate expenses in
1997 included the $30 million charge related to the new accounting standard.
Interest expense declined in 1998 due primarily to a lower level of outstanding
indebtedness. Minority interest in after-tax earnings in 1998 relates to NL and
CompX. Discontinued operations in 1997 consist of the results of the Company's
former building products and fast food operations. The extraordinary item in
1998 relates to the early extinguishment of certain NL indebtedness.
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 and political
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 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)
QUARTERS ENDED MARCH 31, 1997 AND 1998
(IN MILLIONS, EXCEPT EARNINGS PER SHARE)
<TABLE>
<CAPTION>
1997 1998
<S> <C> <C>
NET SALES
Chemicals $239.5 $235.3
Component products 25.8 32.1
$265.3 $267.4
OPERATING INCOME
Chemicals $ 13.5 $ 37.4
Component products 6.3 4.3
TOTAL OPERATING INCOME 19.8 41.7
Equity in Waste Control Specialists (2.7) (3.2)
Gain on:
Disposal of specialty chemicals business unit - 330.2
Reduction in interest in CompX - 67.9
General corporate items, net:
Securities earnings 14.7 17.3
Expenses, net (34.9) (7.8)
Interest expense (30.7) (25.4)
Income (loss) before income taxes (33.8) 420.7
Provision for income taxes (benefit) (10.7) 181.6
Minority interest in after-tax earnings - 34.4
INCOME (LOSS) FROM CONTINUING OPERATIONS (23.1) 204.7
Discontinued operations 15.6 -
Extraordinary item - (1.3)
NET INCOME (LOSS) $ (7.5) $203.4
</TABLE>
VALHI, INC. AND SUBSIDIARIES
SUMMARY OF OPERATIONS (CONTINUED)
(UNAUDITED)
QUARTERS ENDED MARCH 31, 1997 AND 1998
(IN MILLIONS, EXCEPT EARNINGS PER SHARE)
<TABLE>
<CAPTION>
1997 1998
<S> <C> <C>
BASIC EARNINGS PER COMMON SHARE
Continuing operations $ (.20) $ 1.78
Discontinued operations .13 -
Extraordinary item - (.01)
NET INCOME (LOSS) $ (.07) $ 1.77
DILUTED EARNINGS PER COMMON SHARE
Continuing operations $ (.20) $ 1.76
Discontinued operations .13 -
Extraordinary item - (.01)
NET INCOME (LOSS) $ (.07) $ 1.75
SHARES USED IN CALCULATION OF PER SHARE AMOUNTS
Basic earnings 114.8 115.1
Diluted earnings 114.8 116.1
</TABLE>
