FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1994
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-3122
Ogden Corporation
(Exact name of registrant as specified in its charter)
Delaware 13-5549268
(State or other jurisdiction of I.R.S. Employer Identification
incorporation or organization) Number)
Two Pennsylvania Plaza, New York, New York 10121
(Address or principal executive office) (Zip Code)
(212)-868-6100
(Registrant's telephone number including
area code)
Not Applicable
(Former name, former address and former
fiscal year, if changed since last report)
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 (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
APPLICABLE ONLY TO CORPORATE ISSUERS:
The number of shares outstanding of each of the issuer's classes of common
stock, as of September 30, 1994; 43,617,209 shares of Common Stock, $.50
par value per share.<PAGE>
<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
OGDEN CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
<CAPTION>
FOR THE NINE MONTHS FOR THE THREE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
1994 1993 1994 1993
(In Thousands of Dollars, Except per Share Data)
<S> <C> <C> <C> <C>
OPERATIONS OTHER THAN WASTE TO ENERGY:
Net sales $ 348,277 $ 320,313 $ 138,675 $ 126,963
Service revenues 698,492 699,003 242,087 231,047
Total net sales and service revenues 1,046,769 1,019,316 380,762 358,010
Costs of goods sold 304,322 282,954 119,011 110,818
Operating expenses 612,381 612,128 216,330 202,322
Selling, administrative and
general expenses 85,982 79,379 30,072 26,825
Total costs and expenses 1,002,685 974,461 365,413 339,965
Operating income 44,084 44,855 15,349 18,045
WASTE-TO-ENERGY OPERATIONS:
Service revenues 340,996 319,350 112,143 106,392
Construction revenues 165,971 176,838 53,794 76,454
Total revenues 506,967 496,188 165,937 182,846
Operating costs 200,772 192,255 64,118 63,038
Construction costs 152,638 166,304 48,862 70,827
Selling, administrative
and general expenses 16,152 11,879 6,043 3,791
Debt service charges 75,315 73,267 25,079 24,747
Other deductions (income)-net (569) (812) (200) (254)
Total costs and expenses 444,308 442,893 143,902 162,149
Operating income 62,659 53,295 22,035 20,697
Consolidated Operating Income 106,743 98,150 37,384 38,742
Interest income 8,506 6,687 3,715 2,247
Interest expense (16,915) (15,304) (6,081) (5,270)
Other income (deductions)-net 610 1,828 763 (94)
Income before income taxes and
minority interest 98,944 91,361 35,781 35,625
Less: income taxes 40,567 42,438 14,670 19,587
minority interest 6,667 4,286 2,369 1,315
Income before cumulative effect of
changes in accounting principles 51,710 44,637 18,742 14,723
Cumulative effect of changes in
accounting principles (net of
income taxes of $1,100 and
$3,710 for 1994 and 1993,
respectively) (1,520) (5,340)
NET INCOME $ 50,190 $ 39,297 $ 18,742 $ 14,723
EARNINGS (LOSS) PER COMMON SHARE:
Income before cumulative effect of
changes in accounting principles $ 1.18 $ 1.03 $ .43 $ .34
Cumulative effect of changes in
accounting principles (.03) (.12)
Total $ 1.15 $ .91 $ .43 $ .34
EARNINGS (LOSS) PER COMMON
SHARE-ASSUMING FULL DILUTION:
Income before cumulative effect of
changes in accounting principles $ 1.17 $ 1.02 $ .43 $ .34
Cumulative effect of changes in
accounting principles (.03) (.12)
Total $ 1.14 $ .90 $ .43 $ .34
</TABLE>
<PAGE>
<TABLE>
OGDEN CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1994 1993
(In Thousands of Dollars)
<S> <C> <C>
ASSETS
OPERATIONS OTHER THAN WASTE TO ENERGY:
Current Assets:
Cash and cash equivalents $ 115,436 $ 105,539
Marketable securities available for sale 97,424 94,247
Receivables (less allowances: 1994,
$21,144 and 1993, $18,226) 402,583 375,532
Other 42,260 29,835
Total current assets 657,703 605,153
Property, plant and equipment (net of
accumulated depreciation and amortization
of $240,783 and $228,434, respectively) 132,395 130,439
Other assets 303,752 281,255
Total 1,093,850 1,016,847
WASTE-TO-ENERGY OPERATIONS:
Cash 7,368 3,558
Receivables (less allowances: 1994,
$13,759 and 1993, $7,321) 246,161 224,561
Restricted funds held in trust 326,039 359,416
Property, plant and equipment (net of
accumulated depreciation of $186,665
and $156,475, respectively) 1,601,621 1,563,362
Other assets 135,306 144,766
Total 2,316,495 2,295,663
CONSOLIDATED ASSETS $ 3,410,345 $ 3,312,510
</TABLE>
<PAGE>
<TABLE>
OGDEN CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1994 1993
(In Thousands of Dollars)
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
OPERATIONS OTHER THAN WASTE TO ENERGY:
Current liabilities:
Current portion of long-term debt $ 3,889 $ 3,070
Accounts payable 90,864 74,317
Accrued expenses, etc. 123,667 105,132
Total current liabilities 218,420 182,519
Long-term debt 250,446 247,640
Deferred income taxes 39,357 43,926
Other liabilities 113,644 95,963
Minority interest in subsidiaries 69,547 61,981
Convertible subordinated debentures 151,750 151,750
Total 843,164 783,779
WASTE-TO-ENERGY OPERATIONS:
Accounts payable 14,346 24,647
Accrued expenses, etc. 151,235 151,874
Project debt:
Revenue bonds issued by and prime
responsibility of municipalities 1,203,970 1,210,935
Revenue bonds issued by municipal agencies
with sufficient service revenues
guaranteed by third parties 338,051 340,431
Other borrowings 28,423 28,423
Deferred income taxes 185,842 155,130
Deferred income 53,056 52,028
Other liabilities 93,302 78,996
Total 2,068,225 2,042,464
CONSOLIDATED LIABILITIES 2,911,389 2,826,243
SHAREHOLDERS' EQUITY 498,956 486,267
CONSOLIDATED LIABILITIES AND
SHAREHOLDERS' EQUITY $ 3,410,345 $ 3,312,510
</TABLE>
<PAGE>
<TABLE>
OGDEN CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1994 1993
(In Thousands of Dollars)
<S> <C> <C>
Serial Cumulative Convertible Preferred
Stock, par value $1.00 per share;
authorized, 4,000,000 shares:
shares outstanding: 54,000 in 1994,
57,000 in 1993 $ 54 $ 57
Common Stock, par value $.50 per share;
authorized, 80,000,000 shares:
shares outstanding: 43,617,000 in
1993, 43,499,000 in 1993 21,809 21,750
Capital Surplus 101,912 100,223
Earned Surplus 379,429 370,231
Cumulative Translation Adjustment-Net (1,589) (4,639)
Pension Liability Adjustment (928) (928)
Net Unrealized Loss on Noncurrent
Marketable Securities (427)
Net Unrealized Loss on Securities
Available for Sale (1,731)
Consolidated Shareholders' Equity $ 498,956 $486,267
</TABLE>
<PAGE>
<TABLE>
OGDEN CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
<CAPTION>
FOR THE NINE MONTHS ENDED
SEPTEMBER 30,
1994 1993
(In Thousands of Dollars)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash generated from operations $ 163,607 $ 148,253
Management of Operating Assets and Liabilities:
Decrease (Increase) in Assets:
Receivables (49,367) (54,622)
Other assets (37,644) (46,310)
Increase (Decrease) in Liabilities:
Accounts payable 5,931 12,473
Accrued expenses 22,590 42,474
Other liabilities 25,313 39,540
Net cash provided by operating
activities 130,430 141,808
CASH FLOWS FROM INVESTING ACTIVITIES:
Entities purchased, net of cash acquired (4,768) (51,208)
Proceeds from sale of marketable securities
available for sale 57,031 68,852
Purchase of marketable securities available
for sale (62,256) (48,816)
Proceeds from sale of business 12,516
Proceeds from sale of property, plant and equipment 1,109 8,049
Investments in waste-to-energy facilities (64,275) (52,656)
Other capital expenditures (32,862) (29,810)
Decrease (increase) in non-current receivables (11,231) 1,274
Other 249 5,076
Net cash used in investing activities (104,487) (99,239)
CASH FLOWS FROM FINANCING ACTIVITIES:
Other new debt 5,650 4,560
Decrease in funds held in trust for
waste-to-energy facilities 33,377 39,476
Payment of debt (11,384) (20,537)
Dividends paid (40,956) (40,715)
Other 1,077 2,971
Net cash used in financing activities (12,236) (14,245)
NET INCREASE IN CASH AND CASH EQUIVALENTS 13,707 28,324
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 109,097 116,457
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 122,804 $ 144,781
</TABLE>
<PAGE>
OGDEN CORPORATION AND SUBSIDIARIES
SEPTEMBER 30, 1994
ITEM 1 - BASIS OF PRESENTATION:
The accompanying unaudited consolidated condensed financial statements have
been prepared in accordance with the instructions to Form 10-Q and,
therefore, do not include all information and footnotes necessary for a fair
presentation of financial position, results of operations, and cash flows in
conformity with generally accepted accounting principles. However, in the
opinion of the Management, all adjustments consisting of normal recurring
accruals necessary for a fair presentation of the operating results have
been included in the statements.
The Corporation adopted SFAS 112, "Employers' Accounting for Postemployment
Benefits," and SFAS 115, "Accounting for Certain Investments in Debt and
Equity Securities," as of January 1, 1994. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations" for the effect on
the accompanying financial statements.
The accompanying financial statements for prior periods have been
reclassified as to certain amounts to conform with the 1994 presentation.
<TABLE>
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS:
Operations:
<CAPTION>
Nine Months Three Months
Information Concerning Ended September 30, Ended September 30,
Business Segments 1994 1993 1994 1993
(In Thousands of Dollars)
<S> <C> <C> <C> <C>
Revenues:
Operating Services $1,046,769 $1,019,316 $380,762 $358,010
Waste-to-Energy Operations 506,967 496,188 165,937 182,846
Total Revenues $1,553,736 $1,515,504 $546,699 $540,856
Income From Operations:
Operating Services $ 52,549 $ 53,842 $ 18,869 $ 21,063
Waste-to-Energy Operations 62,659 53,295 22,035 20,697
Total Income from Operations 115,208 107,137 40,904 41,760
Corporate unallocated expenses-net (7,855) (7,159) (2,757) (3,112)
Corporate interest-net (8,409) (8,617) (2,366) (3,023)
Income Before Income Taxes
and Minority Interest 98,944 91,361 35,781 35,625
Less: Income Taxes 40,567 42,438 14,670 19,587
Minority Interest 6,667 4,286 2,369 1,315
Income Before Cumulative Effect
Of Changes In Accounting Principles 51,710 44,637 18,742 14,723
Cumulative Effect Of Changes In
Accounting Principles (Net Of
Income Taxes Of $1,100 and $3,710
for 1994 and 1993, respectively) (1,520) (5,340)
Net Income $ 50,190 $ 39,297 $ 18,742 $ 14,723
</TABLE>
<PAGE>
Sales and service revenues for the first nine months of 1994 were
$38,200,000 higher than the comparable period of 1993. Operating
Services revenues were $27,500,000 higher, primarily reflecting
increased revenues of $19,100,000 in Ogden Environmental and
Energy Services primarily due to increased activity in the
consulting and power generation groups; $13,300,000 in Atlantic
Design reflecting several new contracts and increased customer
activity; $11,600,000 in Aviation Services primarily due to the
start up of operations in Brazil and increased customer activity;
and $9,000,000 in Entertainment Services due to several new
contracts, including the start up of Arrowhead Pond of Anaheim,
partially offset by the effects of the baseball strike in the
third quarter of 1994; these increases were partially offset by
lower sales of $16,500,000 in Facility Services (formerly
Building Services and Industrial Services) primarily due to the
sale of California Building Services contracts in the second
quarter of 1993, and the loss of certain utility facility
maintenance and building cleaning contracts; and $8,700,000 in
Government Services due to the loss of several contracts and
reduced customer activity. Waste-to-Energy operations (Ogden
Projects, Inc.) revenues increased $10,700,000. Service revenues
were $21,600,000 higher due primarily to increased revenues at
the Detroit, Michigan, Hartford, Connecticut, and Honolulu,
Hawaii facilities acquired in January 1993; revenues from the
start up and full operation of the Union County, New Jersey
facility; the operation of the transfer station at Montgomery
County, Maryland, and from securing higher priced waste streams
at certain other facilities. Construction revenues were
$10,900,000 lower primarily due to reduced construction activity
at the Union County, New Jersey facility completed in May 1994
and the Lee County, Florida facility. These reductions were
partially offset by increased activity at the Montgomery County,
Maryland facility.
Consolidated operating income for the first nine months of 1994
was $8,600,000 higher than the comparable period of 1993.
Operations Other Than Waste-to-Energy operating income was
$800,000 lower, reflecting a decrease of $1,300,000 in Operating
Services income and a decrease of $500,000 in corporate
unallocated expenses (included in selling, administrative and
general expenses). The decrease in Operating Services income was
primarily due to lower earnings in Government Services of
$4,400,000 reflecting the loss of several contracts and lower
customer activity; and $1,600,000 in increased marketing and
administrative expense for all services. These decreases were
partially offset by increased income at Atlantic Design of
$2,400,000 reflecting several new contracts and increased
customer activity; $1,600,000 in Ogden Environmental and Energy
Services due primarily to increased activity in the power
generation area, and $1,600,000 in Facility Management Services
reflecting higher margins and an increase in the number of energy
plants managed. Waste-to-Energy operating income was $9,400,000
higher than the comparable period of 1993. Service income
(service revenues less operating costs and debt service charges)
was $11,100,000 higher chiefly associated with the full
commercial operations of the Union County, New Jersey facility,
and improved performance at certain other existing facilities.
Debt service charges for the nine months ending September 30,
1994, include an increase of $500,000 for additional interest
costs on two interest rate swap agreements over the comparable
period of 1993. Construction income was $2,800,000 higher due
primarily to increased activity at the Montgomery County,
Maryland facility and the retrofit project at the Detroit
facility, partially offset by reduced activity at the other
facilities under construction during the respective periods.
General and administrative expenses increased $4,300,000
primarily reflecting increased marketing efforts including those
related to opportunities in new industries and international
markets.
Interest income for the first nine months of 1994 was $1,800,000
higher than the comparable period of 1993 primarily reflecting
interest earned on loans made in the third quarter of 1994 and
higher interest earnings on investments.
Interest expense for the first nine months of 1994 was $1,600,000
higher than the comparable period of 1993 primarily reflecting a
reduction of $1,300,000 in income received on two interest rate
swap agreements covering notional amounts of $100,000,000 each.
One swap agreement expired in March 1994. The other swap
agreement expires on December 16, 1998.
The effective income tax rate for the first nine months of 1994
was 41% compared with 46.5% for the comparable period of 1993.
This decrease of 5.5% is chiefly associated with the Omnibus
Budget Reconciliation Act of 1993, signed in August 1993, which
increased the Federal income tax rate from 34% to 35% retroactive
to January 1, 1993. As required by SFAS 109, deferred income tax
balances were restated to the new tax rate which resulted in a
one time charge of $4,100,000 in the nine months of 1993.
Sales and service revenues for the third quarter of 1994 were
$5,800,000 higher than the comparable period of 1993. Operating
Services revenues were $22,800,000 higher primarily due to an
increase of $10,400,000 in Aviation Services reflecting the
start-up of operations at two airports in Brazil and increased
activity, in fueling and in European and other Latin America
airports, $9,400,000 at Ogden Environmental and Energy Services
primarily due to increased activity in consulting and engineering
activity and laboratory testing; and $7,100,000 in Atlantic
Design primarily due to new contracts and increased customer
activity. These increases were partially offset by a decrease in
Entertainment Services of $4,200,000 primarily reflecting the
effects of the baseball strike. Waste-to-Energy operations
revenues were $16,900,000 lower than the comparable period of
1993. Service revenues were $5,800,000 higher due primarily to
revenues generated from the commercial operations of the Union
County, New Jersey facility, and the securing of higher priced
waste streams at certain other operating facilities.
Construction revenues were $22,700,000 lower, due primarily to
reduced activity at the Lee County facility and the Union County
facility which was completed in May, 1994.
Consolidated operating income for the third quarter of 1994 was
$1,400,000 lower than the comparable period of 1993. Operations
Other Than Waste-to-Energy operating income was $2,700,000 lower
reflecting a decrease of $2,200,000 in Operating Services income
and an increase of $500,000 in corporate unallocated expenses
(included in selling, administrative and general expenses). The
decrease in Operating Services income was primarily due to lower
earnings of $1,900,000 in Entertainment Services primarily
reflecting the effects of the baseball strike and start-up costs
in overseas operations; and $1,300,000 in Government Services
primarily due to reduced activity and the loss of several
contracts. These decreases were partially offset by an increase
of $1,100,000 at Atlantic Design reflecting increased customer
activity and several new contracts. Waste-to-Energy income from
operations was $1,300,000 higher than the comparable period of
1993. Service income (service revenues less operating costs and
debt service charges) was $4,300,000 higher reflecting the start-
up of commercial operations of the Union County, New Jersey
facility. Debt service charges for the three months ended
September 30, 1994 include an decrease of $300,000 for lower
interest cost on two interest rate swap agreements over the
comparable period of 1993. Construction income was $700,000
lower than the comparable period of 1993 due primarily to reduced
construction activity at the Lee County facility. General and
administrative expenses increased $2,300,000 primarily reflecting
increased marketing efforts, including those related to
opportunities in new industries and international markets.
Interest income for the third quarter of 1994 was $1,500,000
higher than the comparable period of 1993 primarily reflecting
interest earned on loans made in the third quarter of 1994 and
higher interest earnings on investments.
Interest expense for the three months ended September 30, 1994
was $800,000 higher than the comparable period of 1993 primarily
reflecting a reduction of income received on an interest rate
swap agreement.
The effective income tax rate for the third quarter of 1994 was
41% compared with a 55% rate for the comparable period of 1993.
This decrease of 14% was due primarily to the retroactive Federal
income tax rate increase from 34% to 35% on August 10, 1993, all
of which was reflected in the third quarter of 1993, as well as
the adjustment of deferred income tax balances to the new rate as
required by SFAS 109 which resulted in a one time charge of
$4,100,000.
The Corporation adopted Statement of Financial Accounting No. 112
"Employers Accounting for Postemployment Benefits" (SFAS 112) as
of January 1, 1994. This Statement establishes accounting
standards for employers who provide benefits to former or
inactive employees after employment but before retirement. These
benefits include, but are not limited to, salary continuation,
supplemental unemployment benefits, severance benefits,
disability benefits, job training, health care benefits, and life
insurance coverage. The effect of implementing SFAS 112 as of
January 1, 1994 is shown in the accompanying financial statements
as a cumulative effect of a change in accounting principle and is
reflected as a charge to income of $1,520,000 or $.03 per share.
The Corporation also adopted SFAS 115, "Accounting for Certain
Investments in Debt and Equity Securities" as of January 1, 1994.
This statement establishes accounting and reporting standards for
investments in equity securities that have readily determinable
fair values and for investments in debt securities. The Company
adopted SFAS 115 and has classified its investments as "available
for sale securities" and reports these investments at their fair
value on the balance sheet. The unrealized loss, net of income
taxes at September 30, 1994, on these investments, amounting to
$1,730,000 is shown as a separate component of shareholders
equity.
Capital Investments, Commitments and Liquidity:
During the first nine months of 1994, capital investments
amounted to $97,200,000 of which $64,300,000, inclusive of
restricted funds transferred from funds held in trust, was for
Waste-to-Energy Operations and $32,900,000 was for normal
replacement and growth in Operating Services, Waste-to-Energy
Operations and for corporate office equipment.
At September 30, 1994, capital commitments amounted to
$32,700,000, which includes commitments for equity investments
(over and above restricted funds provided by revenue bonds issued
by municipalities) of $3,200,000 for waste-to-energy facilities
and $29,500,000 for normal replacement, modernization, and growth
in Operating Services and Waste-to-Energy Operations.
Ogden continues as a guarantor of surety bonds and letters of
credit totaling approximately $19,200,000 on behalf of
International Terminal Operating Co. Inc. (ITO). Ogden's
obligation as guarantor on behalf of Avondale Industries Inc.
with respect to $36,000,000 of Industrial Revenue Bonds as well
as other contingent obligations under which Ogden may have been
required to purchase Avondale preferred stock ended June 1, 1994.
Ogden is contingently liable as a result of transactions arising
in the ordinary cause of business including the guarantee of
indebtedness of customers of approximately $13,200,000.
Waste-to-energy facilities are financed to a large degree by
revenue bonds issued by the municipalities and restricted funds
held in trust as a result of revenue bonds issued for facility
construction. Other capital commitments and payments, if any,
required by guarantees, are expected to be satisfied from cash
flow from operations; available funds, including short-term
investments; and the Corporation's unused credit facilities to
the extent needed. At September 30, 1994, the Corporation had
$220,200,000 in cash, cash equivalents, and marketable securities
and unused revolving credit lines of $169,300,000.
On September 27, 1994, the Corporation entered into a merger
agreement (the "Merger Agreement") with Ogden Projects, Inc.
(OPI), an 84% owned subsidiary. Pursuant to the Merger Agreement
Ogden will acquire the remaining 16% of the shares it does not
currently own by exchanging 0.84 of a share of Ogden common stock
for each share of OPI's common stock. A form S-4 Registration
Statement detailing the transaction was filed with the Securities
and Exchange Commission on October 27, 1994. The Corporation
expects the merger to be completed in late December 1994 or
during the first quarter of 1995.
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
In the ordinary course of its business, Ogden's
subsidiaries ("Ogden Subsidiaries") become involved in
federal, state, and local proceedings relating to the
laws regulating the discharge of materials into the
environment and the protection of the environment.
These include proceedings for the issuance, amendment,
or renewal of the licenses and permits pursuant to
which Ogden Subsidiaries operate. Such proceedings
also include actions brought by individuals or local
governmental authorities seeking to overrule
governmental decisions on matters relating to Ogden
Subsidiaries' operations in which Ogden Subsidiaries
may be, but are not necessarily, a party. Most
proceedings brought against Ogden Subsidiaries by
governmental authorities under these laws relate to
alleged technical violations of regulations, licenses,
or permits pursuant to which Ogden subsidiaries
operate. At September 20, 1994, Ogden Subsidiaries
were involved in such proceedings in which Ogden
believes sanctions involved may exceed $100,000 in the
aggregate. Ogden believes that such proceedings will
not have a material adverse effect on its business.
Item 5. Other Information
Ogden is the owner of 84% of the outstanding common
stock of Ogden Projects, Inc. ("OPI"), a Delaware
company whose common stock is traded on the New York
Stock Exchange.
On September 27, 1994, Ogden, OPI and a wholly owned
subsidiary of Ogden entered into a definitive merger
agreement. The merger agreement is subject to approval
by the OPI shareholders and provides, among other
things, that the OPI shareholders will receive 0.84 of
a share of Ogden common stock for each outstanding
share of OPI common stock and that any OPI shareholder
who does not vote in favor of the merger agreement will
be entitled to appraisal rights in connection with the
merger.
On October 27, 1994, Ogden filed its Form S-4
Registration Statement with the Securities and Exchange
Commission, which contains a preliminary version of the
OPI proxy statement to be mailed to OPI shareholders.
OPI and Ogden expect to consummate the merger by year
end or during the first quarter of 1995.
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
2.0 (a) Agreement and Plan of merger, dated as
of October 31, 1989, among Ogden, ERCI
Acquisition Corporation and ERC
International, Inc.*
(b) Amended and Restated Agreement and Plan
of Merger by and among Ogden
Corporation, OPI Acquisition Corp. and
Ogden Projects, Inc., dated as of
September 27, 1994.*
4.0 (a) Ogden's Restated Certificate of
Incorporation, as amended.*
(b) Amended and Restated Agreement and
Plan of Merger by and among Ogden
Corporation, OPI Acquisition Corp
and Ogden Projects, Inc., dated as
of September 27, 1994.*
(c) Underwriting Agreement dated as of
March 4, 1992 by and among Ogden
Corporation, Goldman Sachs & Co.,
J.P. Morgan Securities, Inc. and
Salomon Brothers, Inc.*
(d) Indenture dated as of March 1, 1992
between Ogden Corporation and The
Bank of New York, Trustee, relating
to Ogden's $100 million debt
offering.*
(e) Fiscal Agency Agreement and
Offering Memorandum describing
Ogden's $85 million 6% Convertible
Subordinated Debentures, Due 2002
and $75 million 5.75% Convertible
Subordinated Debentures, Due 2002.*
(f) Credit Agreement by and among
Ogden, The Bank of New York, as
Agent, and National Westminster
Bank PLC, Swiss Bank Corporation
and Union Bank of Switzerland,
dated as of January 31, 1990.*
(g) Amendment No. 1, dated December 28,
1990, to the Credit Agreement,
dated January 31, 1990, by and
among Ogden, the signatory Banks
thereto and The Bank of New York,
as Agent.*
<PAGE>
10.0 Material Contracts
10.1 Stock Purchase Agreement, dated May 31,
1988, between Ogden and Ogden Projects,
Inc.*
10.2 Tax Sharing Agreement, dated January 1,
1989, between Ogden, Ogden Projects,
Inc. and subsidiaries, Ogden Allied
Services, Inc. and subsidiaries and
Ogden Financial Services, Inc. and
subsidiaries.*
10.3 Stock Purchase Option Agreement, dated
June 14, 1989, between Ogden and Ogden
Projects, Inc. as amended on November
16, 1989.*
10.4 Preferred Stock Purchase Agreement,
dated July 7, 1989, between Ogden
Financial Services, Inc. and Image Data
Corporation.*
(i) Preferred Stock Exchange Agreement
between Image Data Corporation and
Ogden Financial Services, Inc.
dated as of January 1, 1991.*
10.5 Rights Agreement between Ogden
Corporation and Manufacturers Hanover
Trust Company, dated as of September 20,
1990.*
10.6 Executive Compensation Plans and
Agreements
(a) Ogden Corporation 1986 Stock Option
Plan.*
(b) Ogden Corporation 1990 Stock Option
Plan.*
(i) Ogden Corporation 1990 Stock
Option Plan as Amended and
Restated as of January 19,
1994.
(c) Ogden Services Corporation
Executive Pension Plan.*
(d) Ogden Services Corporation Select
Savings Plan.*
(e) Ogden Services Corporation Select
Savings Plan Trust.*
(f) Ogden Services Corporation
Executive Pension Plan Trust.*
<PAGE>
(g) Changes effected to the Ogden
Profit Sharing Plan effective
January 1, 1990.*
(h) Employment Letter Agreement between
Ogden and an Executive Officer
dated January 30, 1990.*
(i) Employment Agreement between Ogden
and R. Richard Ablon dated as of
May 24, 1990.*
(1) Letter Amendment Employment
Agreement between Ogden and R.
Richard Ablon dated as of
October 11, 1990.*
(j) Employment Agreement between Ogden
and C.G. Caras dated as of July 2,
1990.*
(i) Ogden Corporation 1990 Stock
Option Plan as Amended and
Restated as of January 19,
1994.
(k) Employment Agreement between Ogden
and Philip G. Husby as of July 2,
1990.*
(l) Termination Letter Agreement
between Maria P. Monet and Ogden
dated as of October 22, 1990.*
(m) Letter Agreement between Ogden and
Ogden's Chairman of the Board dated
January 16, 1992.*
(n) Employment Agreement between Ogden
and Ogden's Chief Accounting
Officer dated as of December 18,
1991.*
(o) Employment Agreement between Scott
G. Mackin and Ogden Projects, Inc.
dated as of June 1, 1990.*
(p) Ogden Corporation Profit Sharing
Plan.*
(q) Ogden Corporation Core Executive
Benefit Program.*
(r) Ogden Projects Pension Plan.*
(s) Ogden Projects Profit Sharing
Plan.*
(t) Ogden Projects Supplemental Pension
and Profit Sharing Plan.*
(u) Ogden Projects Employee's Stock
Option Plan.*
(v) Ogden Projects Core Executive
Benefit Program.*
(w) Ogden Corporation CEO Formula Bonus
Plan.
10.7 Agreement and Plan of Merger among Ogden
Corporation, ERC International, Inc.,
ERC Acquisition Corporation and ERC
Environmental and Energy Services Co.,
dated as of January 17, 1991.*
10.8 First Amended and Restated Ogden
Corporation Guaranty Agreement made as
of January 30, 1992 by Ogden Corporation
for the benefit of Mission Funding Zeta
and Pitney Bowes Credit Corporation.*
10.9 Ogden Corporation Guaranty Agreement as
of January 30, 1992 by Ogden Corporation
for the benefit of Allstate Insurance
Company and Ogden Martin Systems of
Huntington Resource Recovery Nine
Corporation.*
11.0 Detail of Computation of Earnings
applicable to Common Stock.
27.0 Financial Data Schedule (EDGAR Filing
Only).
* Incorporated by reference as set forth in the Exhibit Index
of this Form 10-Q.
(b) Reports on Form 8-K -- There were no reports on
Form 8-K filed for the three months ended
September 30, 1994.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this registration statement
to be signed on its behalf by the undersigned, thereto duly
authorized.
OGDEN CORPORATION
(Registrant)
Date: November 14, 1994 By: /S/ Philip G. Husby
Philip G. Husby
Senior Vice President
and Chief Financial
Officer
Date: November 14, 1994 By: /S/ Robert M. DiGia
Robert M. DiGia
Vice President,
Controller and Chief
Accounting Officer
<TABLE>
EXHIBIT 11
OGDEN CORPORATION AND SUBSIDIARIES
DETAIL OF COMPUTATION OF EARNINGS APPLICABLE TO COMMON STOCK
<CAPTION>
FOR THE NINE MONTHS FOR THE THREE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
1994 1993 1994 1993
(In Thousands)
<S> <C> <C> <C> <C>
NUMBER OF SHARES USED FOR COMPUTATION OF
EARNINGS PER SHARE:
Average number of common shares 43,565 43,343 43,593 43,460
NUMBER OF SHARES USED FOR COMPUTATION OF
EARNINGS PER SHARE ASSUMING FULL DILUTION:
Average number of common shares 43,565 43,343 43,593 43,460
Shares issuable for conversion of preferred stock 331 360 325 350
Shares issuable for conversion of debentures 56
Number of shares used for computation 43,896 43,759 43,918 43,810
COMPUTATION OF EARNINGS APPLICABLE TO COMMON SHARES:
Income before cumulative effect of changes
in accounting principles $51,710 $44,637 $18,742 $14,723
Add (less): adjustments arising from minority
interests in consolidated subsidiaries 7 24 5 11
dividends on Ogden preferred stock (139) (151) (45) (49)
Consolidated income applicable to Ogden common stock $51,578 $44,510 $18,702 $14,685
Cumulative effect of changes in accounting
principles $(1,520) $(5,340) $ 0 $ 0
COMPUTATION OF EARNINGS APPLICABLE TO COMMON SHARES-
ASSUMING FULL DILUTION:
Income before cumulative effect of changes
in accounting principles $51,710 $44,637 $18,742 $14,723
Add: adjustments arising from minority
interests in consolidated subsidiaries 7 24 5 11
debenture interest-net of applicable
income taxes 16 (1)
Consolidated income applicable to Ogden common stock $51,717 $44,677 $18,747 $14,733
Cumulative effect of changes in accounting
principles $(1,520) $(5,340) $ 0 $ 0
Note:
Earnings per common share were computed by dividing net income, increased (decreased) for
adjustments arising from minority interest in consolidated subsidiaries, reduced by preferred
stock dividend requirements, by the weighted average of the number of shares of common stock and
common stock equivalents, where dilutive, outstanding during each period.
Earnings per common share, assuming full dilution, were computed on the assumption that all
convertible debentures, convertible preferred stock, and stock options converted or exercised
during each period, or outstanding at the end of each period were converted at the beginning of
each period or at the date of issuance or grant, if dilutive. This computation provides for the
elimination of related convertible debenture interest and preferred dividends.
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET AND STATEMENT OF CONSOLIDATED INCOME OF THE
COMPANY AS OF AND FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1994 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-01-1994
<PERIOD-END> SEP-30-1994
<CASH> 122,804
<SECURITIES> 97,424
<RECEIVABLES> 657,434
<ALLOWANCES> 34,903
<INVENTORY> 13,916
<CURRENT-ASSETS> 657,703
<PP&E> 2,161,464
<DEPRECIATION> 427,448
<TOTAL-ASSETS> 3,410,345
<CURRENT-LIABILITIES> 218,420
<BONDS> 1,920,076
<COMMON> 21,809
0
54
<OTHER-SE> 477,093
<TOTAL-LIABILITY-AND-EQUITY> 3,410,345
<SALES> 348,277
<TOTAL-REVENUES> 1,553,736
<CGS> 304,322
<TOTAL-COSTS> 1,345,428
<OTHER-EXPENSES> 98,148
<LOSS-PROVISION> 3,417
<INTEREST-EXPENSE> 16,915
<INCOME-PRETAX> 98,944
<INCOME-TAX> 40,567
<INCOME-CONTINUING> 51,710
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> (1,520)
<NET-INCOME> 50,190
<EPS-PRIMARY> $1.15
<EPS-DILUTED> $1.14
</TABLE>
EXHIBIT INDEX
EXHIBIT
NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
2 (a) Agreement and Plan of Merger, Filed as Exhibit 2 to Ogden's
dated as of October 31, 1989, Form S-4 Registration Statement,
among Ogden, ERCI Acquisition File No. 33-32155 and
Corporation and ERC International incorporated herein by
Inc. reference.
(b) Amended and Restated Agreement Filed as Exhibit 2 to Ogden's
and Plan of Merger by and among Form S-4 Registration Statement,
Ogden Corporation, OPI dated October 27, 1994, File
Acquisition Corp. and Ogden No. 33-56181 and incorporated
Projects, Inc. dated as of herein by reference.
September 27, 1994.
4 (a) Ogden's Restated Certificate Filed as Exhibit (4)(a)
of Incorporation as amended. to Ogden's Form 10-Q for the
quarter ended September 30,
1990 and incorporated herein
by reference.
(b) Underwriting Agreement, dated Filed as Exhibit 1(b) to
as of March 4, 1992 by and among Ogden's Form 10-K for the
Ogden Corporation, Goldman Sachs fiscal year ended December 31,
& Co., J.P. Morgan Securities, 1991 and incorporated herein
Inc. and Salomon Brothers Inc. by reference.
(c) Indenture dated as of March 1, Filed as Exhibit (4)(c) to
1992 between Ogden Corporation Ogden's Form 10-K for fiscal
and The Bank of New York, year ended December 31, 1991,
Trustee, relating to Ogden's and incorporated herein by
$100 million debt offering. reference.
(d) Fiscal Agency Agreement and Filed as Exhibits (4)(a) and
Offering Memorandum describing (b) to Ogden's Form 10-K for
Ogden's $85 million 6% the fiscal year ended
Convertible Subordinated December 31, 1989 and
Debentures, Due 2002 and incorporated herein by
$75 million 5.75% Convertible reference.
Subordinated Debentures, Due
2002.
(e) Credit Agreement by and among Filed as Exhibit (10)(b) to
Ogden, The Bank of New York, as Ogden's Form 10-K for the
Agent and National Westminster fiscal year ended December 31,
Bank PLC, Swiss Bank Corporation 1989 and incorporated herein
and Union Bank of Switzerland by reference.
dated as of January 31, 1990.
(f) Amendment No. 1, dated December Filed as Exhibit (10)(i) to
28, 1990 to the Credit Agreement, Ogden's Form 10-K for the
dated January 31, 1990, by and fiscal year ended December 31,
among Ogden, the signatory Banks 1990 and incorporated herein
thereto and The Bank of New York, by reference.
as Agent.<PAGE>
EXHIBIT
NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
10 Material Contracts
10.1 Stock Purchase Agreement dated Filed as Exhibit (10)(d) to
May 31, 1988, between Ogden and Ogden's Form 10-K for the
Ogden Projects, Inc. fiscal year ended December 31,
1989 and incorporated herein
by reference.
10.2 Tax Sharing Agreement, dated Filed as Exhibit (10)(e) to
January 1, 1989 between Ogden, Ogden's Form 10-K for the
Ogden Projects, Inc. and fiscal year ended December 31,
subsidiaries, Ogden Allied 1989 and incorporated herein
Services, Inc. and subsidiaries by reference.
and Ogden Financial Services,
Inc. and subsidiaries.
10.3 Stock Purchase Option Agreement, Filed as Exhibit (10)(f) to
dated June 14, 1989, between Ogden's Form 10-K for the
Ogden and Ogden Projects, Inc. fiscal year ended December 31,
as amended on November 16, 1989. 1989 and incorporated herein
by reference.
10.4 Preferred Stock Purchase Filed as Exhibit (10)(g) to
Agreement, dated July 7, 1989, Ogden's Form 10-K for the
between Ogden Financial Services, fiscal year ended December 31,
Inc. and Image Data Corporation. 1989 and incorporated herein
by reference.
(i) Preferred Stock Exchange Filed as Exhibit (10)(f)(i) to
Agreement between Image Ogden's Form 10-K for the
Data Corporation and Ogden fiscal year ended December 31,
Financial Services, Inc., 1990 and incorporated herein
dated as of January 1, 1991. by reference.
10.5 Rights Agreement between Ogden Filed as Exhibit (10)(h) to
Corporation and Manufacturers Ogden's Form 10-K for the
Hanover Trust Company, dated as fiscal year ended December 31,
of September 20, 1990. 1990 and incorporated herein
by reference.
10.6 Executive Compensation
Plans and Agreements.
(a) Ogden Corporation 1986 Filed as Exhibit (10)(k) to
Stock Option Plan. Ogden's Form 10-K for the
fiscal year ended December 31,
1985 and incorporated herein
by reference.
(b) Ogden Corporation 1990 Filed as Exhibit (10)(j) to
Stock Option Plan. Ogden's Form 10-K for the
fiscal year ended December 31,
1990 and incorporated herein
by reference.
<PAGE>
EXHIBIT
NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
(i) Ogden Corporation 1990 Transmitted herewith as
Stock Option Plan as Exhibit 10.6(b)(i).
Amended and Restated on
January 19, 1994.
(c) Ogden Services Corporation Filed as Exhibit (10)(k) to
Executive Pension Plan. Ogden's Form 10-K for the
fiscal year ended December 31,
1990 and incorporated herein
by reference.
(d) Ogden Services Corporation Filed as Exhibit (10)(l) to
Select Savings Plan. Ogden's Form 10-K for the
fiscal year ended December 31,
1990 and incorporated herein
by reference.
(e) Ogden Services Corporation Filed as Exhibit (10)(m) to
Select Savings Plan Trust. Ogden's Form 10-K for the
fiscal year ended December 31,
1990 and incorporated herein
by reference.
(f) Ogden Services Corporation Filed as Exhibit (10)(n) to
Executive Pension Plan Trust. Ogden's Form 10-K for the
fiscal year ended December 31,
1990 and incorporated herein
by reference.
(g) Changes effected to the Ogden Filed as Exhibit (10)(o) to
Profit Sharing Plan effective Ogden's Form 10-K for the
January 1, 1990. fiscal year ended December 31,
1990 and incorporated herein
by reference.
(h) Employment Letter Agreement Filed as Exhibit (10)(p) to
between Ogden and an executive Ogden's Form 10-K for the
officer dated January 30, 1990. fiscal year ended December 31,
1990 and incorporated herein
by reference.
(i) Employment Agreement between Filed as Exhibit (10)(r) to
R. Richard Ablon and Ogden Ogden's Form 10-K for the
dated as of May 24, 1990. fiscal year ended December 31,
1990 and incorporated herein
by reference.
(i) Letter Amendment to Filed as Exhibit (10)(r)(i)
Employment Agreement to Ogden's Form 10-K for the
between Ogden Corporation fiscal year ended December 31,
and R. Richard Ablon, dated 1990 and incorporated herein
as of October 11, 1990. by reference.
<PAGE>
EXHIBIT
NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
(j) Employment Agreement between Filed as Exhibit (10)(s) to
Ogden and C. G. Caras dated Ogden's Form 10-K for the
as of July 2, 1990. fiscal year ended December 31,
1990 and incorporated herein
by reference.
(i) Letter Amendment to Filed as Exhibit (10)(s)(i)
Employment Agreement to Ogden's Form 10-K for the
between Ogden Corporation fiscal year ended December 31,
and C. G. Caras, dated as 1990 and incorporated herein
of October 11, 1990. by reference.
(k) Employment Agreement between Filed as Exhibit (10)(t) to
Ogden and Philip G. Husby, Ogden's Form 10-K for the
dated as of July 2, 1990. fiscal year ended December 31,
1990 and incorporated herein
by reference.
(l) Termination Letter Agreement Filed as Exhibit (10)(v) to
between Maria P. Monet and Ogden Ogden's Form 10-K for the
dated as of October 22, 1990. fiscal year ended December 31,
1990 and incorporated herein
by reference.
(m) Letter Agreement between Ogden Filed as Exhibit 10.2 (p) to
Corporation and Ogden's Chairman Ogden's Form 10-K for fiscal
of the Board, dated as of year ended December 31, 1991
January 16, 1992. and incorporated herein by
reference.
(n) Employment Agreement between Filed as Exhibit 10.2 (q) to
Ogden Corporation and Ogden's Ogden's Form 10-K for fiscal
Chief Accounting Officer dated year ended December 31, 1991
as of December 18, 1991. and incorporated herein by
reference.
(o) Employment Agreement between Filed as Exhibit 10.8(o) to
Scott G. Mackin and Ogden Ogden's Form 10-K for fiscal
Projects, Inc. dated as of year ended December 31, 1992
June 1, 1990. and incorporated herein by
reference.
(p) Ogden Corporation Profit Sharing Filed as Exhibit 10.8(p) to
Plan. Ogden's Form 10-K for fiscal
year ended December 31, 1992
and incorporated herein by
reference.
(q) Ogden Corporation Core Executive Filed as Exhibit 10.8(q) to
Benefit Program. Ogden's Form 10-K for fiscal
year ended December 31, 1992
and incorporated herein by
reference.
<PAGE>
EXHIBIT
NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
(r) Ogden Projects Pension Plan. Filed as Exhibit 10.8(r) to
Ogden's Form 10-K for fiscal
year ended December 31, 1992
and incorporated herein by
reference.
(s) Ogden Projects Profit Sharing Filed as Exhibit 10.8(s) to
Plan. Ogden's Form 10-K for fiscal
year ended December 31, 1992
and incorporated herein by
reference.
(t) Ogden Projects Supplemental Filed as Exhibit 10.8(t) to
Pension and Profit Sharing Plans. Ogden's Form 10-K for fiscal
year ended December 31, 1992
and incorporated herein by
reference.
(u) Ogden Projects Employee's Stock Filed as Exhibit 10.8(u) to
Option Plan. Ogden's Form 10-K for fiscal
year ended December 31, 1992
and incorporated herein by
reference.
(v) Ogden Projects Core Executive Filed as Exhibit 10.8(u) to
Benefit Program. Ogden's Form 10-K for fiscal
year ended December 31, 1992
and incorporated herein by
reference.
(w) Ogden Corporation CEO Formula Transmitted herewith as
Bonus Plan. Exhibit 10.6(w).
10.7 Agreement and Plan of Merger Filed as Exhibit (10)(x) to
among Ogden Corporation, ERC Ogden's Form 10-K for the
International Inc., ERC fiscal year ended December 31,
Acquisition Corporation and 1990 and incorporated herein
ERC Environmental and Energy by reference.
Services Co., Inc. dated as of
January 17, 1991.
10.8 First Amended and Re-stated Filed as Exhibit 10.3 (b) (i)
Ogden Corporation Guaranty to Ogden's Form 10-K for
Agreement made as of January 30, fiscal year ended December 31,
1992 by Ogden Corporation for 1991 and incorporated herein
the benefit of Mission Funding by reference.
Zeta and Pitney Bowes Credit
Corporation.
10.9 Ogden Corporation Guaranty Filed Exhibit 10.3 (b) (iii)
Agreement made as of January to Ogden's Form 10-K for
30, 1992 by Ogden Corporation fiscal year ended December 31,
for the benefit of Allstate 1991 and incorporated herein
Insurance Company and Ogden by reference.
Martin Systems of Huntington
Resource Recovery Nine Corp.
EXHIBIT
NO. DESCRIPTION OF DOCUMENT FILING INFORMATION
11 Ogden Corporation and Transmitted herewith as
Subsidiaries Detail of Exhibit 11.
Computation of Earnings
Applicable to Common Stock.
27 Financial Data Schedule Transmitted herewith as
(for EDGAR filing only) Exhibit 27.
