<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(XX) Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the Quarterly Period ended November 30, 1997
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 1-8831
(Exact name of registrant as specified in its charter)
FEDDERS CORPORATION
<TABLE>
<S> <C>
Delaware 22-2572390
(State of incorporation) (I.R.S. Employer Identification No.)
</TABLE>
<TABLE>
<S>
P. O. Box 813 <C>
505 Martinsville Road, Liberty Corner, NJ 07938-0813
(Address of principal executive offices) (Zip Code)
</TABLE>
Registrant's telephone number, including area code: 908/604-8686
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
As of December 31, 1997, the registrant has outstanding 18,839,698 shares of
Common Stock, 21,082,706 shares of Class A Stock (which is immediately
convertible into Common Stock on a share-for-share basis upon conversion of
all of the Class B Stock) and 2,266,706 shares of Class B Stock (which is
immediately convertible into Common Stock on a share-for-share basis).
<PAGE>
FEDDERS CORPORATION
INDEX
<TABLE>
<CAPTION>
Page
Number
<S> <C>
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Statements of Operations 3
Consolidated Balance Sheets 4-5
Consolidated Statements of Cash Flows 6
Notes to Consolidated Financial Statements 7-14
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 15-16
Part II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 17
SIGNATURE 18
</TABLE>
<Page 3>
PART I FINANCIAL INFORMATION
FEDDERS CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
Three months ended
November 30, November 30,
1997 1996
<S> <C> <C>
Net sales $ 25,491 $ 33,087
Costs and expenses:
Cost of sales 20,758 25,908
Selling, general and
administrative expenses 9,035 9,358
29,793 35,266
Operating loss (4,302) (2,179)
Minority interest in
joint venture 95 508
Net interest income (expense) (1,836) 3
Loss before income taxes (6,043) (1,668)
Federal, state and foreign
income tax benefit 2,112 422
Net loss (3,931) (1,246)
Preferred stock dividend
requirement - 726
Loss attributable to
common stockholders $ (3,931) $ (1,972)
Net loss per share $ (0.09) $ (0.05)
Dividends per share declared:
Common Stock $ 0.020 $ 0.020
Class A Stock 0.020 0.020
Class B Stock 0.018 0.018
Preferred Stock - 0.095
</TABLE>
See accompanying notes
<Page 4>
FEDDERS CORPORATION
CONSOLIDATED BALANCE SHEETS
(amounts in thousands, except share data)
(unaudited)
<TABLE>
<CAPTION>
November 30, August 31, November 30,
1997 1997 1996
<S> <C> <C> <C>
ASSETS:
Current assets:
Cash $ 55,609 $110,393 $ 28,188
Accounts receivable (less
allowance of $1,189, $1,834 and
$2,630 at November 30, 1997,
August 31, 1997 and
November 30, 1996, respectively) 14,241 9,060 9,736
Inventories:
Finished goods 49,762 32,233 51,069
Work in process 5,147 6,631 5,047
Raw materials and supplies 29,668 24,023 39,656
84,577 62,887 95,772
Deferred income taxes 4,070 4,070 3,584
Prepaid expenses 8,201 8,917 2,988
Total current assets 166,698 195,327 140,268
Property, plant and equipment at cost:
Land and improvements 3,701 3,924 3,946
Buildings 23,516 24,349 23,895
Machinery and equipment 87,677 87,421 86,971
Machinery and equipment under
capital lease 8,945 8,647 8,191
123,839 124,341 123,003
Less accumulated depreciation 60,750 60,347 59,605
63,089 63,994 63,398
Deferred income taxes 6,374 6,374 7,364
Goodwill 56,432 56,858 58,208
Other assets 6,580 6,461 2,798
$299,173 $329,014 $272,036
</TABLE>
See accompanying notes
<Page 5>
FEDDERS CORPORATION
CONSOLIDATED BALANCE SHEETS
(amounts in thousands, except share data) (unaudited)
<TABLE>
<CAPTION>
November 30, August 31, November 30,
1997 1997 1996
<S> <C> <C> <C>
LIABILITIES & STOCKHOLDERS' EQUITY:
Current liabilities:
Current portion of long-term debt $ 1,926 $ 1,891 $ 1,727
Accounts payable 14,984 10,591 18,220
Income taxes payable 10,875 10,027 10,168
Accrued expenses 18,391 31,082 27,204
Total current liabilities 46,176 53,591 57,319
Long-term debt 111,112 113,489 38,101
Other long-term liabilities 11,118 11,207 14,234
Minority interest in joint venture 4,945 5,040 5,330
Commitments and Contingencies
Stockholders' equity:
Preferred Stock, $1 par value,
15,000,000 shares authorized,
6,809,184 and 7,517,061 issued
at August 31, 1997 and
November 30,1996, respectively - 6,809 7,517
Common Stock, $1 par value,
80,000,000 shares authorized,
18,839,698 issued at November
30, 1997, August 31, 1997 and
November 30, 1996, respectively 18,840 18,990 18,990
Class A Stock, $1 par value,
60,000,000 shares authorized,
28,242,238, 20,074,281 and
19,629,514 issued at
November 30, 1997, August 31,
1997 and November 30, 1996,
respectively 28,242 20,074 19,630
Class B Stock, $1 par value,
7,500,000 shares authorized,
2,266,706 issued at November
30, 1997, August 31, 1997
and November 30, 1996, respectively 2,267 2,267 2,267
Additional paid-in capital 87,684 85,702 87,806
Retained earnings 32,219 37,024 21,147
Cumulative translation adjustment (190) (138) (305)
169,062 170,728 157,052
Less:
Treasury stock, at cost,
7,447,130 and 4,334,800 shares
at November 30, 1997 and
August 31, 1997 (43,240) (25,041) -
Total stockholders' equity 125,822 145,687 157,052
$299,173 $329,014 $272,036
</TABLE>
See accompanying notes
<Page 6>
FEDDERS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in thousands) (unaudited)
<TABLE>
<CAPTION>
Three months ended
November 30,
1997 1996
<S> <C> <C>
Cash flows from operations:
Net loss $ (3,931) $ (1,246)
Adjustments to reconcile net loss
to net cash used in operating activities:
Depreciation and amortization 2,288 2,432
Changes in operating assets and liabilities:
Accounts receivable (5,181) (1,761)
Inventories (21,690) (42,326)
Other current assets 716 378
Other assets (119) (132)
Accounts payable 4,393 1,706
Income taxes payable 848 (5,223)
Accrued expenses (12,701) (10,851)
Other long-term liabilities (89) (261)
Other (52) (147)
Net cash used in operations (35,518) (57,431)
Cash flows from investing activities:
Additions to property, plant and equipment (1,967) (2,610)
Disposals of property, plant and equipment 1,032 96
Minority interest in Joint Venture (95) (278)
Net cash used in investing activities (1,030) (2,792)
Cash flows from financing activities:
Repayments of long-term debt (2,354) (578)
Proceeds from stock options exercised 73 166
Repurchase of capital stock (15,081) -
Cash dividend (874) (1,472)
Net cash used in financing activities (18,236) (1,884)
Net decrease in cash and cash equivalents (54,784) (62,107)
Cash and cash equivalents at beginning of period 110,393 90,295
Cash and cash equivalents at end of period $ 55,609 $ 28,188
Supplemental disclosure:
Interest paid $ 466 $ (489)
Net income tax paid (refunded) (3,121) 4,951
Supplemental disclosure of non-cash investing and financing activities:
The redemption of 6,492,778 shares of
Convertible Preferred Stock for 1.022 shares
each of Class A Stock or 6,635,619 shares
(Note D). $ 6,636 $ -
Stock options exercised through exchange of
963,198 shares of Class A Stock. 4,322 -
</TABLE>
See accompanying notes
<Page 7>
FEDDERS CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
A. Net loss per share was computed using the weighted average number of
shares of Common, Class A and Class B Stock and other common stock
equivalents outstanding which amounted to approximately 42,333,000 and
42,215,000 shares in the first quarter of 1998 and 1997, respectively.
Additionally, at November 30, 1996 there were approximately 7.5 million
shares of Convertible Preferred Stock ("Preferred Stock") outstanding.
B. Pursuant to the Company's stock option plans, options to purchase
1,257,730 and 87,000 shares of Class A Stock were exercised during the
first three months of fiscal 1998 and 1997, respectively.
C. In July 1997, the Company announced that it had been authorized to
repurchase up to an additional $50 million of outstanding stock. Under
this plan, in the first quarter of fiscal 1998, the Company purchased
approximately 2.3 million shares of Class A, Preferred and Common Stock
for approximately $13.4 million or approximately $5.83 per share. Total
repurchases under the program amount to $17.8 million.
D. In September 1997, the Company redeemed its Preferred Stock for 1.022
shares of Class A Stock based on the average closing price of $6.113
of the Class A Stock. The redemption resulted in the surrender of
6,492,778 shares of Preferred Stock for 6,635,619 shares of Class A
stock. Fractional shares and all accounts holding 100 shares or less
were paid in cash at the rate of $6.25 per share which amounted to
$0.3 million at November 30, 1996. At November 30, 1996 there were
approximately 7.5 million shares of Preferred Stock outstanding.
E. In August 1997, Fedders North America, Inc. ("FNA"), a subsidiary of
the Company issued $100 million principal amount of 9 3/8% senior
subordinated notes due in 2007. The notes are guaranteed by the Company on
a senior subordinated basis. The Company received a dividend payment of
approximately $72.3 million from FNA to support a $50 million stock
repurchase program and to redeem its 8 1/2% Convertible Subordinated
Debentures due 2012, in the aggregate amount of approximately $22.3
million, which was completed in August 1997. The following condensed
consolidating financial statements present separate information for FNA and
the Company and its subsidiaries, other than FNA. The non-guarantor and
subsidiaries of the Company are inconsequential, individually and in the
aggregate, to the consolidated financial statements and management has
determined that separate financial statements of the Company would not be
meaningful.
<Page 8>
E. Continued
(Amounts in thousands) (unaudited)
<TABLE>
<CAPTION>
Condensed Consolidating Statements of Operations
For the Three Months Ended
November 30, 1997
Fedders Other Fedders
North America Fedders Corporation
<C> <C> <C>
Net Sales $ 17,664 $ 7,827 $ 25,491
Cost of Sales 15,265 5,493 20,758
Selling, general and
administrative expenses (a) 6,345 2,690 9,035
Operating loss (3,946) (356) (4,302)
Minority interest in joint
venture - 95 95
Net interest income (expense) (b) (3,229) 1,393 (1,836)
Income (loss) before income taxes (7,175) 1,132 (6,043)
Income taxes (benefit) (2,511) 399 (2,112)
Net income (loss) (4,664) 733 (3,931)
Preferred stock dividend
requirements - - -
Net income (loss) attributable to
common stockholders $ (4,664) $ 733 $ (3,931)
For the Three Months Ended
November 30, 1996
Fedders Other Fedders
North America Fedders Corporation
<C> <C> <C>
Net sales $ 26,389 $ 6,698 $ 33,087
Cost of sales 21,307 4,601 25,908
Selling, general and
administrative expenses (a) 6,923 2,435 9,358
Operating loss (1,841) (338) (2,179)
Minority interest in joint
venture - 508 508
Net interest income (expense) (b) (477) 480 3
Income (loss) before income taxes (2,318) 650 (1,668)
Income taxes (benefit) (584) 162 (422)
Net income (loss) (1,734) 488 (1,246)
Preferred stock dividend
requirements - 726 726
Net loss attributable to common
stockholders $ (1,734) $ (238) $ (1,972)
</TABLE>
See accompanying notes
<Page 9>
E. Continued
(Amounts in thousands) (unaudited)
<TABLE>
<CAPTION>
Condensed Consolidating Balance Sheets
November 30, 1997
Fedders Other Eliminating Fedders
North America Fedders Entries Corporation
ASSETS <C> <C> <C> <C>
Current assets
Cash $ - $ 55,609 $ $ 55,609
Accounts receivable, net 11,180 3,061 14,241
Inventories 70,676 13,901 84,577
Other current assets 926 11,345 12,271
Total current assets 82,782 83,916 - 166,698
Investments in subsidiaries - 104,306 (104,306) -
Property, plant and equipment,
net 51,588 11,501 63,089
Goodwill 49,930 6,502 56,432
Other long-term assets 3,646 9,308 12,954
$187,946 $215,533 $(104,306) $299,173
LIABILITIES AND STOCKHOLDERS EQUITY
Current liabilities:
Current portion of long-term
debt $ 1,907 $ 19 $ $ 1,926
Accounts and income taxes
payable 20,981 4,878 25,859
Accrued expenses 15,036 3,355 18,391
Total current liabilities 37,924 8,252 - 46,176
Net due to (from) affiliate 23,820 (23,820) -
Long-term debt 106,895 4,217 111,112
Other long-term liabilities 2,832 13,231 16,063
Stockholders' equity:
Common Class A and
Class B Stock 5 49,344 49,349
Paid-in capital 21,292 239,616 (173,224) 87,684
Retained earnings (deficit) (4,664) (32,035) 68,918 32,219
Treasury stock - (43,240) (43,240)
Cumulative translation
adjustment (158) (32) (190)
Total stockholders' equity 16,475 213,653 (104,306) 125,822
$187,946 $215,533 $(104,306) $299,173
See accompanying notes
<Page 10>
E. Continued
(Amounts in thousands) (unaudited)
</TABLE>
<TABLE>
<CAPTION>
Condensed Consolidating Balance Sheets
August 31,1997
Fedders Other Eliminating Fedders
North America Fedders Entries Corporation
ASSETS <C> <C> <C> <C>
Current assets
Cash $ - $110,393 $ $110,393
Accounts receivable, net 5,461 3,599 9,060
Inventories 50,303 12,584 62,887
Other current assets 584 12,403 12,987
Total current assets 56,348 138,979 _ 195,327
Investments in subsidiaries - 104,306 (104,306) -
Property, plant and equipment,
net 51,466 12,528 63,994
Goodwill 50,284 6,574 56,858
Other long-term assets 7,794 5,041 12,835
$165,892 $267,428 $(104,306) $329,014
LIABILITIES AND STOCKHOLDERS EQUITY
Current liabilities:
Current portion of long-term
debt $ 1,870 $ 21 $ $ 1,891
Accounts and income taxes
payable 20,747 (129) 20,618
Accrued expenses 22,752 8,330 31,082
Total current liabilities 45,369 8,222 - 53,591
Net due to (from) affiliate (10,758) 10,758 -
Long-term debt 107,346 6,143 113,489
Other long-term liabilities 2,780 13,467 16,247
Stockholders' equity:
Preferred Stock - 6,809 6,809
Common Class A and
Class B Stock 5 41,326 41,331
Paid-in capital 21,292 237,634 (173,224) 85,702
Retained earnings (deficit) - (31,894) 68,918 37,024
Treasury stock - (25,041) (25,041)
Cumulative translation
adjustment (142) 4 (138)
Total stockholders' equity 21,155 228,838 (104,306) 145,687
$165,892 $267,428 $(104,306) $329,014
See accompanying notes
<Page 11>
E. Continued
(Amounts in thousands) (unaudited)
</TABLE>
<TABLE>
<CAPTION>
Condensed Consolidating Balance Sheets
November 30, 1996
Fedders Other Eliminating Fedders
North America Fedders Entries Corporation
ASSETS <C> <C> <C> <C>
Current assets
Cash $ - $ 28,188 $ $ 28,188
Accounts receivable, net 7,512 2,224 9,736
Inventories 80,842 14,930 95,772
Other current assets 587 5,985 6,572
Total current assets 88,941 51,327 - 140,268
Investments in subsidiaries - 104,306 (104,306) -
Property, plant and equipment,
net 50,998 12,400 63,398
Goodwill 51,418 6,790 58,208
Other long-term assets 559 9,603 10,162
$191,916 $184,426 $(104,306) $272,036
LIABILITIES AND STOCKHOLDERS EQUITY
Current liabilities:
Current portion of long-term
debt $ 1,704 $ 23 $ $ 1,727
Accounts and income taxes
payable 22,060 6,328 28,388
Accrued expenses 22,360 4,844 27,204
Total current liabilities 46,124 11,195 - 57,319
Net due to (from) affiliate (90,103) 90,103 -
Long-term debt 8,885 29,216 38,101
Other long-term liabilities 4,291 15,273 19,564
Stockholders' equity:
Preferred Stock - 7,517 7,517
Common Class A and
Class B Stock 5 40,882 40,887
Paid-in capital 109,637 87,641 (109,472) 87,806
Retained earnings (deficit 113,201 (97,220) 5,166 21,147
Cumulative translation
adjustment (124) (181) (305)
Total stockholders'equity 222,719 38,639 (104,306) 157,052
$191,916 $184,426 $(104,306) $272,036
See accompanying notes
<Page 12>
E. Continued
(Amounts in thousands) (unaudited)
</TABLE>
<TABLE>
<CAPTION>
Condensed Consolidating Statements of Cash Flows
For the Three Months Ended
November 30, 1997
Fedders Other Fedders
North America Fedders Corporation
<C> <C> <C>
Net cash provided by (used in)
operations $ (32,987) $ (2,531) $ (35,518)
Net additions (disposals) of property,
plant, and equipment, being
cash used in investing activities (1,177) 147 (1,030)
Net repayments of short and long-
term borrowings (414) (1,940) (2,354)
Cash dividends - (874) (874)
Proceeds from stock options
exercised - 73 73
Repurchase of capital stock - (15,081) (15,081)
Change in net due to (from)
affiliate 34,578 (34,578) -
Net cash provided by (used in)
financing activities 34,164 (52,400) (18,236)
Net decrease in cash and cash
equivalents - (54,784) (54,784)
Cash and cash equivalents at
beginning of year - 110,393 110,393
Cash and cash equivalents at
end of period $ - $ 55,609 $ 55,609
See accompanying notes
<Page 13>
E. Continued
(Amounts in thousands) (unaudited)
</TABLE>
<TABLE>
<CAPTION>
Condensed Consolidating Statements of Cash Flows
For the Three Months Ended
November 30, 1996
Fedders Other Fedders
North America Fedders Corporation
<C> <C> <C>
Net cash provided by (used in)
operations $ (40,216) $ (17,215) $ (57,431)
Net additions (disposals) of property,
plant, and equipment, being
cash used in investing activities (2,564) (228) (2,792)
Net repayments of short and long-
term borrowings (403) (175) (578)
Cash dividends - (1,472) (1,472)
Proceeds from stock options
exercised - 166 166
Change in net due to (from)
affiliate 43,183 (43,183) -
Net cash provided by (used in)
financing activities 42,780 (44,664) (1,884)
Net decrease in cash and cash
equivalents - (62,107) (62,107)
Cash and cash equivalents at
beginning of year - 90,295 90,295
Cash and cash equivalents at
end of period $ - $ 28,188 $ 28,188
Intercompany transactions
The historical condensed consolidating financial statements presented
above include the following transactions between the Company and FNA.
a) The Company charges corporate overhead essentially on a cost basis
allocated in proportion to sales. Such charges to FNA amounted to
approximately $2.8 million and $2.6 million for the three months ended
November 30, 1997 and 1996, respectively.
b) The Company allocates interest expense to FNA based upon the level of
FNA's working capital at the prime rate of interest. Such interest charges
amounted to approximately $0.6 million and $0.4 million for the three
months ended November 30, 1997 and 1996, respectively.
c) FNA's depreciation and amortization for the three months ended November
30, 1997 and 1996 amounted to approximately $1.6 million and $1.9 million,
respectively. Capital expenditures of FNA for the same periods amounted to
$1.2 million and $2.6 million, respectively.
<Page 14>
F. On January 8, 1998, the Company announced that it will recognize
expenses to restructure its operations totaling $16.8 million in the second
fiscal quarter ending February 28, 1998. The restructuring will not result
in factory closings. However, it will involve shifting some additional
production from FNA factories to China. As part of the restructuring,
sales, marketing, service and administrative support functions of Fedders
North America will be relocated to the Company's factory in Effingham,
Illinois. The charges consist primarily of the write-off of certain fixed
assets($5.8 million), amounts for termination of various equipment and
facility leases ($5.4 million), personnel-related costs ($2.9 million) and
facility-closing costs ($2.7 million).
G. The financial information included herein is unaudited; however, such
information reflects all adjustments which consist solely of normal
recurring adjustments which are, in the opinion of management, necessary
for a fair statement of results for the interim periods. The Company's
business is seasonal, and consequently, operating results for the three-month
period ending November 30, 1997 are not necessarily indicative of the
results that may be expected for the fiscal year ending August 31, 1998.
<Page 15>
Item 2. Management's Discussion and Analysis of Results of Operations and
Financial Condition.
The following is management's discussion and analysis of certain
significant factors which affected the Company's financial position and
operating results during the periods included in the accompanying
consolidated financial statements.
First Quarter
Results of Operations
</TABLE>
<TABLE>
<CAPTION>
Operating Results As A Percent Of Net Sales
1998 1997
<S> <C> <C>
Gross profit 18.6% 21.7%
Selling, general and
administrative expenses 35.4% 28.3%
Operating loss (16.9%) (6.6%)
Interest income (expense) (7.2%) -
Pre-tax loss (23.7%) (5.0%)
</TABLE>
Net sales in the seasonally low-volume first quarter of fiscal 1998 of
$25.5 million decreased 23.0% from sales of $33.1 million in the first
quarter of 1997. The decrease is the result of a more pronounced seasonal
pattern of domestic sales primarily because major retailers, who continue
to gain market share, want deliveries closer to the air-conditioning
season, which is in the second half of the Company's fiscal year.
The gross profit margin decreased in the first quarter of 1998 due to lower
absorption of fixed costs and expenses in the air conditioning and
compressor factories related to the lower sales volume.
Selling, general and administrative expenses decreased to $9.0 million in
the current year from $9.4 million in the prior year period. These expenses
increased as a percentage of net sales from the prior year as a result of
the sales decrease.
Net interest expense increased in the first fiscal quarter due to interest
on the 9 3/8% senior subordinated notes due in 2007 offset, in part, by a
reduction in interest expense related to the redemption of the Company's
8 1/2% convertible subordinated debentures.
<Page 16>
The net loss for the normally unprofitable off-season quarter of fiscal
1998 was $3.9 million, or 9 cents per share, compared to a net loss
attributable to common shareholders in fiscal 1997 of $2.0 million, or 5
cents per share, which included a Preferred Stock dividend requirement of
$0.7 million. In September 1997 the Preferred Stock was called for
redemption.
Liquidity and Capital Resources
Working capital requirements of the Company are seasonal with cash balances
peaking in the fourth fiscal quarter and the greatest utilization of its
lines of credit occurring early in the calendar year. Cash on hand
amounted to $55.6 million at November 30,1997, compared to $28.2 million a
year earlier. The increase was due to proceeds of the $100 million senior
note offering in August 1997. Cash included $2.4 million and $6.2 million
at Fedders Xinle, the Company's Chinese joint venture, at November 30, 1997
Net cash used in operations for the three-months ended November 30, 1997
amounted to $35.5 million. During the seasonally slow first fiscal
quarter, the Company utilized cash to produce compressors and finished
goods. Inventories increased to $84.6 million at November 30, 1997 from
$62.9 million at year end, while decreasing from $95.8 million a year
earlier. Finished goods decreased by $1.3 million from the prior year
level reflecting rebalancing of inventories by moderating production in the
Company's U.S.factories. Work-in-process and raw materials decreased by
$9.9 million as the Company adjusted production. Accounts receivable
increased to $14.3 million.
Net cash used in investing activities consisted primarily of capital
expenditures of $2.0 million in the first three months of fiscal 1998.
Net cash used in financing activities amounted to $18.2 million, primarily
due to stock repurchases under the previously announced stock repurchase
plan of up to $50 million and to payment of dividends. At November 30,1997,
the Company had no short-term borrowings.
In the first quarter of fiscal 1998 and 1997, the Company declared
quarterly dividends of two cents on each share of outstanding Class A and
Common Stock and $1.8 cents on each share of outstanding Class B Stock. In
the prior year period the Company declared a quarterly dividend of $.095
cents on each share of outstanding Preferred Stock.
Management believes that the Company's cash, earnings and borrowing
capacity are adequate to meet the demands of its operations and its long-
term credit requirements.
Forward looking statements are made within the "Safe-Harbor" clause of the
Private Litigation Reform Act of 1995.
<Page 17>
PART II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
None.
<Page 18>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of1934,
the registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
FEDDERS CORPORATION
By/s/Thomas A. Kroll
Thomas A. Kroll
Corporate Controller
Date: January 14, 1998 Signing in his capacity as
Corporate Controller and on behalf
of the Registrant.
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000744106
<NAME> FEDDERS COPROATION
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> AUG-31-1998
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0
0
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